Posted: Wed 25th Nov 2015

Government Spending Review 2015

Wrexham.com for people living in or visiting the Wrexham area
This article is old - Published: Wednesday, Nov 25th, 2015

The Chancellor of the Exchequer presented the Government’s Spending Review this afternoon in London.

The headline grabbers was the scrapping of controversial proposed tax credit cuts, with no change to the system before 2020, and an apparently further u-turn on proposed cuts to policing budgets.

Below are some noted points, plus reaction as we get it…

The government is introducing a floor in the level of relative funding provided to the Welsh Government at 115% of comparable spending per head in England.

In one Wales, and local specific move, Income Tax is to be devolved to Wales, with the Blue Book noting: “The government will legislate to remove the requirement for the Welsh Assembly to hold a referendum in order to implement the Welsh Rates of Income Tax to reflect the change in the debate in Wales.” Northern Ireland gets power to control Corporation Tax, but not Wales.

The much awaited changes or proposals to adapt Business Rates has been pushed back to next year, however the proposal that some local authorities will be able to set and collect 100% of their rates has been confirmed. Small business rate relief has also been extended for another 12 months.

There are also plans to allow local councils keep 100% of the revenue from assets sold off, it is yet to be clarified if this will be rolled out to Wales. Although not mentioned by Mr Osbourne, the Blue Book notes this excludes receipts of ‘right to buy’ housing sell offs.

The Spending Review promises investment of nearly £1 billion in the next generation of 4G communications network for the Emergency Services which will enable officers to access key police databases, take mobile fingerprints and electronic witness statements and stream live body worn video. Described as ‘critical national infrastructure’ it is claimed it will ‘free up officers’ time, save the taxpayer around £1 million a day when fully operational and connect all emergency services on the same broadband network for the first time’.

The full ‘Blue Book’ PDF of the Spending Review can be found here, with two mentions of Wrexham within it, both regarding the new prison.

Local MP Ian Lucas was in the chamber and live tweeting the statement, with his own take on the announcements. Mr Lucas linked the recent closure announcement of Wrexham’s HMRC office to the ‘deficit reduction plan’. Mr Osbourne announced a ‘digital revolution’ on taxation systems, pledging to create a new online system for every entity by the end of the decade.

The pick of the tweets, including one interchange with Plaid Cymru’s Mabon ap Gwynfor below:

Mr Lucas’s own tweets dried up shortly after Labour’s John McDonnell official response included holding up and quoting from a copy of Chairman Mao’s ‘Little Red Book.

Plaid Cymru Treasury spokesperson, Jonathan Edwards MP, welcomed today’s announcement in the Chancellor’s Comprehensive Spending Review that Wales is to be granted income-tax powers without a referendum, hailing a victory for his party which was the first to propose such a move.

Responding to the news, Jonathan Edwards MP said: “For several years, we have argued that the principle of fiscal autonomy has already been conceded by the devolution of minor taxes.

“This means that a referendum would have been a complete waste of time and resources, and we are pleased that the UK Government has finally seen sense on this matter.

“However, Plaid Cymru believes that income tax powers alone are not enough. We want to see Wales being offered the same financial and fiscal powers as the other nations of the UK.”

Responding to the Chancellor’s Spending Review, Welsh Conservative Leader Andrew Davies AM, unsurprisingly endorsed the message: “This is a hugely welcome review that puts Wales first and prioritises communities the length and breadth of our country.

“An additional 900 million in capital funds is extremely positive and – if used correctly – has the potential to benefit everyone in Wales. A deal on a funding guarantee will ensure our country is never short-changed and income tax powers put Welsh government accountability at the top of the agenda.”

“The Chancellor’s decision on tax credits is also extremely welcome and a major uplift in the state pension from next April clearly shows Conservatives in government are the only party that will deliver on both national and financial security. While Labour continues to pose a significant threat to both, we continue to protect and support.”

More reaction shortly as it filters through….



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