Chancellor urged to adopt ‘realistic, practical, fair’ proposals

Plaid Cymru’s Treasury spokesperson, Ben Lake MP has today (Sunday 12 March) outlined his party’s five point plan ahead of Wednesday’s Budget. Mr Lake urged the Chancellor to adopt his party’s “realistic, practical and fair” proposals.

Jeremy Hunt will deliver his first full budget as Chancellor on Wednesday 15 March, as people continue to struggle through the cost-of-living crisis.

Plaid Cymru’s five point plan would prioritise increasing public sector wages; extend energy support and improve energy efficiency; release funds owed to Wales; reduce poverty through investment in the social security system; and improve digital connectivity and fund research projects.

Mr Lake said given that 61% of adults in Wales said their current financial situation was damaging their mental health, compared with 48% of people in Scotland and 47% in England, it was clear the cost-of-living crisis was “far from over”.

The Ceredigion MP said that Plaid Cymru’s five point plan would “put more money in the pockets of ordinary people” and “provide real hope” to communities in a difficult economic context.

Ben Lake MP said:

“With 61 per cent of people in Wales reporting that their mental health is being negatively affected by their financial position, it is clear that the cost-of-living crisis is far from over.

“As people face further hardship, the Chancellor's main priority must be to put more money in the pockets of ordinary people. That's why I urge the Chancellor to adopt Plaid Cymru’s realistic, practical and fair five point plan.

“There is no excuse for failing to increase public sector workers’ wages at least in line with inflation next year. Without our public sector workers, our social fabric falls apart.

“It is unacceptable that in Wales, four in ten people go without heating their homes, and that energy bills are set to rise even further. The Chancellor should use his January budget surplus to extend support as well as bring forward the £6bn committed to energy efficiency in order to permanently slash energy bills,

“The Chancellor must also release the £1bn owed to Wales from money spent on the English HS2 project. Wales deserves our fair share of the entire cost of HS2, which could result in a transformational £5bn over the course of the project’s lifetime.

“The value of benefits have been driven down by inflation. We must start seeing the social security system as a tool to lift people out of poverty, not a burden, and recognise that poverty itself costs our public services billions.

“Finally, digital connectivity must be a priority for the Chancellor. In large parts of Wales, gigabit connectivity is dire, which hinders businesses and workers’ ability to operate effectively. Releasing the £5bn allocated to Project Gigabit could help unlock massive economic potential for Wales.

“A spring statement accompanied by OBR forecasts may feel like Westminster is back to business as usual but high energy bills, inflated food prices and crumbling public services means that business-as-usual will not do. The Chancellor must use the opportunity on Wednesday to provide real hope to communities across Wales.”


Plaid Cymru’s Five Point Plan

1. Fair pay for workers

Public sector wages should be increased at least in line with inflation next year. Increasing public sector wages in England would release funds to the Welsh Government through the Barnett formula.

2. Extend energy support

Support should be extended to households via the Energy Bills Support Scheme and to businesses by reconsidering the parameters for the Energy Bills Discount Scheme. An additional round of the Alternative Fuel Payment should also be guaranteed to off-grid households and businesses next winter. The £6bn committed to energy efficiency in the Autumn Statement must be brought forward in order to permanently slash energy bills.

3. Release HS2 cash

£1bn should be released to Wales immediately by correctly designating HS2 as an ‘England-only’ project. DfT’s statement on HS2 declares that £20bn has already been spent delivering Phase One. A fair 100% HS2 programme-level comparability factor would mean that Wales should already have received £1bn in Barnett consequentials. The Wales Governance Centre estimate the Welsh Government would receive £5bn in Barnett consequentials over the project’s lifetimes if a 100% HS2 programme-level comparability factor were used.

4. Uprate and fix benefits

This should start with setting a minimum level for the value of benefits and introducing a more responsive uprating mechanism to ensure they keep up with rising costs. Local Housing Allowance should be unfrozen and uprated to the 30th percentile of market rents in order to begin to address the unaffordability of housing in Wales for low-income renters.

5. Boost digital connectivity and research

The £5bn allocated to Project Gigabit should be released, helping unlock the massive economic potential for Wales. In Wales gigabit connectivity stands at 50%, compared to the UK average of 68%. In rural parts of Wales this level is much lower, with only 27% of Ceredigion covered. The UK Government should also boost research and development by delivernig the £71m Welsh universities require to bridge the 12-month gap between the end of European funds and the beginning of the Shared Prosperity Fund. In April, 60 research projects across Wales, and the 1000 skilled jobs they support, will be put at risk unless the UK government provides support.