Budget Resolutions and Economic Situation

Ben Lake Excerpts

Wednesday 3rd March 2021 Commons Chamber

[Ben Lake (Ceredigion) (PC)]

We were promised levelling up—a Budget that would stimulate our recovery and lay the foundations for an economy fit for the future. The Chancellor is to be commended for listening to several of Plaid Cymru’s calls to extend the emergency support for businesses and families. It would have made no sense to withdraw that support while we were still in the throes of the pandemic, so I welcome the extension of many business-support measures. However, I am concerned that despite the changes to the self-employment income support scheme, hundreds of thousands of people are still deprived of any support. Although welcome, the delaying of the cut to universal credit will still lead to 26,000 families in Wales not being able to afford essentials in six months’ time. This was a chance to protect families’ budgets by making the uplift permanent.

The Budget raises further questions about the gap between the Government’s rhetoric and reality. According to the Government, the shared prosperity fund and the levelling-up fund are going to turbo-charge the Welsh economy and empower our communities, yet only £220 million is allocated to the shared prosperity fund pilot—to boost the entire UK. Wales alone received around £375 million a year in needs-based funding from the EU schemes, yet now it will be expected to compete for a much smaller pot of money.

What is worse, the prospectus for the levelling up fund suggests that the number of MPs will determine the number of bids that can be made from Wales. Given the fact that the Government have reduced the number of Welsh MPs by a fifth, how on earth are we to believe they can keep their 2019 manifesto promise to give Wales at least as much funding as we have received from European structural funds? With no reference made to the Welsh Government, we must conclude that the decisions on how the funding will be spent—the power, if you like—will again be centralised in the Treasury. That strikes me as yet another example of a “Treasury knows best” mentality, despite the fact that it has delivered an economy riven with some of the worst regional inequalities in the western world.

Of equal concern is the Budget’s underwhelming green measures, as the UK joins rather than leads the green transition. For Wales to achieve our net zero commitments, we urgently need to start by retrofitting more than 100,000 homes, to expand and electrify our rail network and to provide gigabit broadband connection throughout Wales. If the Government are serious about their levelling up agenda, they must act on their rhetoric by decentralising power from Whitehall. Given the right economic tools, Wales can deliver a truly transformational low-carbon infrastructure stimulus package itself, and pave the way for an economy that is truly fit for the future.