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Comprehensive Spending Review

As I was saying, Barnett is bad for Wales in the good times, and also plainly bad for Wales in the bad times. The effect on the block grant under Labour’s budget plans would have been much the same as the Wales Audit Office had reported. The big difference between the Labour and Tory plans was, of course, in the reserve budgets, which account for about 38% of spend in Wales. The savage cuts now being implemented by the UK Government will have a disproportionate effect. In social protection, for example, spend on welfare benefits and those sort of areas equates to 116% of UK average spend, so the severe cutbacks that we will see there will have an effect on local economies and on the most vulnerable in society. I was going to talk about the fact that there are four main areas that drive economic growth. In the CSR, three of those elements have been attacked severely: we are aware of the 19% cut in public expenditure. Housing spending will obviously be hit because of the legacy of consumer debt, which is 100% of GDP, and exports will be held back due to the sluggish growth of our main trading partners. That leaves only private investment, and that is why my party believes strongly that countervailing measures are important, as they will give the Welsh economy and the private sector a competitive advantage. I shall finish there, to let the Front Benchers wind up.