Budget 2021: What did Chancellor Rishi Sunak announce for Wales?

The Chancellor’s budget promised more money for Welsh public services and more money for low-paid workers on universal credit.

Rishi Sunak has promised to increase the Welsh government’s budgets by an average of £ 2.5 billion a year.

Just over £ 120 million from the leveling fund has also been allocated to ten Welsh projects.

The Labor-led Welsh government accused the Treasury of leaving “clear funding gaps”.

He said his own requests for money to address coal depots or additional funding for rail infrastructure went unanswered.

In his announcement, the chancellor promised a cut in the “taper rate” – the point on universal credit where the benefit is reduced because of the money someone earns.

It will drop from 63% to 55%. Recent statistics suggest that just under 100,000 people in Wales in low-wage jobs enjoy universal credit.

This is followed by the decision to end the £ 20 per week hike given during the pandemic.

Sunak said: “An additional £ 2.5 billion annually in Barnett means the Welsh government is well funded to fulfill all the responsibilities entrusted to it, while the people in Wales will also benefit from the commitment. of this government to increase opportunities and provide for all parts of the UK. “

Chancellor said the whole of the UK would benefit from the planned UK Shared Prosperity Fund, which is supposed to replace EU aid.

“Over time” it will match EU funding of around £ 1.5 billion a year, he said.

But the Welsh government has suggested that Wales will receive less than the £ 375 million in European funds it had in the past, although it said the modalities for replacing EU money remain unclear.

Welsh Finance Minister Rebecca Evans said: “While the spending review gives us some medium-term financial certainty and some additional investment, it is more than offset by the inflationary and systemic pressures we are facing.

“The budget fails to meet the scale of the challenge that families, public services and the economy in general are still facing as a result of the pandemic.”

While many services in Wales such as health and education are run by Cardiff and Rishi Sunak cannot decide how to spend the money on them, the big decisions on benefits and taxes are all over the UK.

They include:

Money from the Welsh government funds services such as health care and schools, which are overseen by Welsh ministers rather than Westminster.

The Treasury said it will provide “an additional £ 2.5 billion a year” for this purpose.

Budget documents show that the money received by the Welsh government will rise to £ 17.7bn by 2023, £ 18bn in 2024 and £ 18.2bn in 2025, an overall increase of £ 2.3bn. of pounds by 2022 and 2025.

The Treasury explained that the £ 2.5 billion figure is an average of the extra money allocated to Wales, compared to this year, for each of those three years: £ 2.2 billion in 2022/23, 2 , £ 6 billion in 2023/24 and £ 3.0. billion in 2024/25.

He added that the figures in the budget document take into account the money stolen from the Welsh government subsidy due to the taxes it devolved.

Cardiff ministers will decide how to spend their money over the next couple of months.

The Treasury has also pledged £ 460,000 from the Community Property Fund for three projects.

The UK government has said it will fund a “Veterans Commissioner for Wales” and will carry forward £ 105 million for the Cardiff City region agreement projects.

Plaid Cymru’s Ben Lake accused the chancellor of not offering a “transformative budget that would put money in people’s pockets in the short and long term, as well as ambitious policies to set the global example ahead of COP26”.

“£ 2.5 billion for Wales is a good headline for the UK government. But let’s put that into perspective. Wales owes around £ 5 billion in consequential funding from HS2, which the Chancellor has once again decided today to withhold from Wales “.

Welsh Liberal Democrat leader Jane Dodds said it was “shocking to see the UK government cutting tariffs on air passengers on the eve of COP26.”

“What message does this send to the world about how seriously we take our climate goals?” she said.

Simon Hart, Welsh Conservative Secretary, told BBC Wales he was “baffled” by the Welsh government’s requests for support to clear up coal landfills.

‘In fact, thanks to Barnett’s formula and the money we are able to provide to the Welsh government, they will receive at least £ 250 million from the UK government over the next six years just to alleviate the floods,’ he said.

“It completely amazes me that they can turn around and say we are not providing enough funding.”

Where are the leveling fund projects?

The UK government has offered a total of £ 121 million from its £ 4.8 billion leveling fund to ten projects, including:

As the UK government is chairing a global conference on tackling climate change, which is set to start in Glasgow in a few days, one might expect the Chancellor to have focused his budget on moving to a green economy.

There was no news for one of Wales’ big employers, Tata Steel, who asked for a road map to help decide how to switch from using fossil fuels.

The chancellor announced a second green bond issue, but focused on overall economic growth and not on developing new green industries and ways of doing business.

On the contrary, instead of encouraging us to fly less, it reduced the duty of air passengers to lower the cost of flying between England, Scotland and Wales to “bring the people together”.

The planned fuel tax increase was canceled.

Drivers struggling with higher prices at the pump may appreciate it, but those who want to encourage us to get out of cars to help the planet will be disappointed.

Average wages in Wales are significantly below the UK average and many working families depend on extra money from Universal Credit. The £ 20 per week top-up they were receiving is obviously over, but now if they work extra hours they will lose less money from their UC payments.

However, prices are expected to continue to rise and, coupled with increases in national insurance, will continue to squeeze incomes.