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Budget 2015: Welsh warning over welfare cuts Budget 2015: Welsh warning over welfare cuts
(35 minutes later)
Chancellor George Osborne has unveiled plans for £12bn of welfare cuts in his Budget amid warnings from Citizens Advice Wales about the "human impact". Chancellor George Osborne has unveiled plans for £12bn of welfare cuts in his Budget, amid warnings from Wales about the impact on the poorest in society.
Working age benefits will be frozen, tax credits restricted, and the benefits cap cut to £20,000. Working age benefits will be frozen, tax credits restricted, and the benefit cap cut to £20,000.
Mr Osborne also announced a compulsory "living wage" of £7.20 an hour from next April, rising to £9 by 2020.Mr Osborne also announced a compulsory "living wage" of £7.20 an hour from next April, rising to £9 by 2020.
Shadow Welsh Secretary Owen Smith said he doubted the living wage would offset the "massive cuts" to tax credits.Shadow Welsh Secretary Owen Smith said he doubted the living wage would offset the "massive cuts" to tax credits.
Presenting his Budget in the Commons on Wednesday, the chancellor told MPs he aimed to keep moving the UK to a "higher wage, lower tax, lower welfare country".Presenting his Budget in the Commons on Wednesday, the chancellor told MPs he aimed to keep moving the UK to a "higher wage, lower tax, lower welfare country".
Measures announced include:Measures announced include:
Mr Osborne said the £26,000 benefits cap - the amount one household can claim in a year - would be cut to £23,000 in London and £20,000 in the rest of the UK. Mr Osborne said the £26,000 benefit cap - the amount one household can claim in a year - would be cut to £23,000 in London and £20,000 in the rest of the UK.
With regards to Wales, the chancellor stressed UK ministers' commitment to a funding floor and more powers for Cardiff Bay, along with improvements to the M4 and electrification of the Great Western railway line between Swansea and London.With regards to Wales, the chancellor stressed UK ministers' commitment to a funding floor and more powers for Cardiff Bay, along with improvements to the M4 and electrification of the Great Western railway line between Swansea and London.
He announced an extra £8bn a year for the NHS in England by 2020, which could mean an extra £400m a year for Wales under the rules of the Barnett formula on public spending cross the UK.He announced an extra £8bn a year for the NHS in England by 2020, which could mean an extra £400m a year for Wales under the rules of the Barnett formula on public spending cross the UK.
'Impossible to cope' 'Tough budget'
Reacting via Twitter, Mr Smith said: "As ever with an Osborne budget you have to look at the small print: will his 'Living Wage' offset the massive cuts to Tax Creds? I doubt it." Welsh Secretary Stephen Crabb, reacting via Twitter, hailed "a landmark one nation Budget", giving "a strong foundation for Wales to prosper".
The Welsh government's Finance Minister Jane Hutt said she gave news of a compulsory living wage a "cautious welcome", pointing out that it was already paid to NHS staff in Wales. But Stuart Ropke, chief executive of Community Housing Cymru, which represents housing associations, said thousands of people in Wales would be worse off due to welfare cuts.
Welsh Secretary Stephen Crabb, also reacting via Twitter, hailed "a landmark one nation Budget", giving "a strong foundation for Wales to prosper". "The proposed changes in today's budget will increase in-work and child poverty and impact on the most vulnerable and poorest in our communities," he said.
Speaking before the Budget, Fran Targett, director of Citizens Advice Cymru, warned that further welfare cuts would make life even more difficult for many people. "It's a tough budget for working families and young people, and many will be hit by two or three different changes."
"Although the economy is now growing, every day our local citizens advice offices in Wales are seeing people who are struggling in insecure, low paid work and finding it almost impossible to cope with day-to-day living costs," she said. Reacting via Twitter, Labour's Shadow Welsh Secretary Owen Smith said: "As ever with an Osborne budget you have to look at the small print: will his 'Living Wage' offset the massive cuts to Tax Creds? I doubt it."
"With further changes to the welfare system to come, it is essential people have access to the support they need to adapt to reforms and help them move forward." The Welsh government's Finance Minister Jane Hutt said: "While we cautiously welcome the National Living Wage and have in fact already delivered it for NHS staff in Wales, it is unlikely to cover the cuts to tax credits for most families."
Stuart Ropke, chief executive of Community Housing Cymru, which represents housing associations, added: "The possible breadth of reforms is worrying and many individuals may be hit by two or three different changes. She added that around 5,000 households in Wales could be hit by the lowering of the benefit cap, and 1,200 young adults could be affected by changes to housing benefit entitlements for 18-21 year olds.
"Wales has already been disproportionately affected by welfare reform and we fear that further changes will increase in-work poverty across Wales and will impact on the most vulnerable people in our communities." Janet Jones, Wales Policy Unit chair for the Federation of Small Businesses, welcomed positive moves such as the cut in corporation tax, but warned that some firms might find the national living wage "challenging".
Business leaders had called for measures to boost the Welsh economy. Neil Brierley, chair of the Royal Institution of Chartered Surveyors (RICS) Wales, praised the renewed commitment to upgrading the M4 and the Great Western railway line, and urged ministers to work with others to "deliver these vital projects as soon as possible".
Responding to Mr Osborne's statement, Neil Brierley, chair of the Royal Institution of Chartered Surveyors (RICS) Wales, said: "We welcome the renewed commitment from the UK government in investing in infrastructure in Wales through projects such as the M4 relief road and the Great Western Line.
"We urge UK government to work as closely as possible with Welsh government and other stakeholders to help deliver these vital projects as soon as possible."
Analysis by David Cornock, BBC Wales parliamentary correspondentAnalysis by David Cornock, BBC Wales parliamentary correspondent
So what does the Budget mean for Wales?So what does the Budget mean for Wales?
There was one brief reference to Wales in the chancellor's speech: "In Wales we are honouring our commitments to a funding floor, and to more devolution there, and investing in important new infrastructure like the M4 and the Great Western line."There was one brief reference to Wales in the chancellor's speech: "In Wales we are honouring our commitments to a funding floor, and to more devolution there, and investing in important new infrastructure like the M4 and the Great Western line."
The official Budget documents offer more detail: "The government is committed to taking forward the St David's Day agreement for Wales to the timetable set out in the command paper.The official Budget documents offer more detail: "The government is committed to taking forward the St David's Day agreement for Wales to the timetable set out in the command paper.
"This includes implementing a funding floor at the spending review in the expectation that the Welsh government holds a referendum on the devolution of income tax.""This includes implementing a funding floor at the spending review in the expectation that the Welsh government holds a referendum on the devolution of income tax."
It adds: "The devolution of Air Passenger Duty (APD) to the Welsh assembly will continue to be considered alongside the review of options to mitigate the impacts of APD devolution on regional airports. The government is publishing a discussion paper on regional airports alongside the Budget, setting out how some of the options could work."It adds: "The devolution of Air Passenger Duty (APD) to the Welsh assembly will continue to be considered alongside the review of options to mitigate the impacts of APD devolution on regional airports. The government is publishing a discussion paper on regional airports alongside the Budget, setting out how some of the options could work."
The UK government also claims that Wales grew faster per head than London and the UK average in 2013.The UK government also claims that Wales grew faster per head than London and the UK average in 2013.
Welsh Secretary Stephen Crabb tweeted: "A landmark one nation Budget. Living wage, lower business taxes & deficit falling - a strong foundation for Wales to prosper."Welsh Secretary Stephen Crabb tweeted: "A landmark one nation Budget. Living wage, lower business taxes & deficit falling - a strong foundation for Wales to prosper."