Spring Statement ignores ‘significant change’ to economic outlook

Chancellor must act to protect small businesses and households as Iran war hits energy prices – Ben Lake MP 

Responding to the Chancellor’s Spring Statement today, Plaid Cymru Treasury spokesperson, Ben Lake MP, has said the escalating war involving Iran and the resulting surge in gas prices represent the very “significant change to the economic outlook” that the Chancellor previously said would require action. 

Gas prices have almost doubled since the outbreak of hostilities. Because gas sets the UK’s wholesale electricity price around 90% of the time, this spike is already feeding directly into higher electricity costs – placing small businesses and households across Wales under renewed financial strain. 

With small and medium sized businesses account for over 99% of firms in Wales, Plaid Cymru warned that failing to act now risks undermining jobs, investment and the viability of high streets and rural enterprises. 

In November, Chancellor Reeves said the Spring Statement would include an “interim update on the economy and public finances” from the independent public finances watchdog, the Office for Budget Responsibility (OBR), and that there would be no policy changes unless there is “a significant change to the economic outlook that requires a response.” 

 

Plaid Cymru Treasury spokesperson Ben Lake MP said: 

"The Chancellor said there would be no policy changes unless there was a significant shift in the economic outlook. There are mounting fears that prolonged conflict in the Middle East will impact gas prices and deal a significant blow to today’s forecasts. 

"As gas continues to set the wholesale electricity price most of the time, this surge risks impacting Welsh businesses and households. Small firms – the backbone of our economy – are already struggling with the cumulative impact of higher energy prices, increased staffing costs and taxation, and are ill-equipped to absorb any further price increases. 

"The UK Government should have used this statement to address some of these pressures, including by extending the 75% Renewable Obligation reduction to non-domestic users. This would have at least helped to shield small businesses from high energy costs. Plaid Cymru also urged the Chancellor to consider a cut to VAT for hospitality and tourism, increase the Employment Allowance to ease National Insurance pressures, and introduce a statutory duty to rural proof the Treasury’s policies. 

"At a time of renewed global instability and rising energy costs, we need to be bold. The Chancellor must now bring forward targeted measures to support small businesses and provide reassurance to households facing yet another squeeze on living standards." 

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WHEN WESTMINSTER DOES THE COUNTING, WALES ALWAYS LOSES OUT

Plaid Cymru urges Chancellor to address the shortchanging of Wales in the Budget  

 

Ahead of the Budget on 26 November, Plaid Cymru has called on the Chancellor to deliver a budget that works for Wales.  

 

The party’s Treasury Spokesperson, Ben Lake MP, has said that Wales is “losing out on billions from unfair spending decisions” made by this Labour UK Government.  

 

This includes the continued denial of Barnett consequentials from railway projects such as HS2 and the Oxford-Cambridge line, damaging taxes on family businesses and farms, as well as a shortfall in Wales’ public sector from Employer NIC rises.  However, while Mr Lake has said that the people of Wales are “bearing the brunt” of Labour’s damaging policies, it is unlikely that Rachel Reeves will change these fundamentals next week.   

  

Ahead of the Budget, Plaid Cymru has called for:

  

• Reclassification of HS2 and the Oxford–Cambridge rail as England-only projects to ensure Wales receives the billions it is owed in Barnett consequentials;    

• Unlock Wales’s borrowing powers to address historic underinvestment;    

• Halt Labour’s damaging taxes on work and introduce a tax on extreme wealth;  

• Cut the cost of energy and give Wales control of the Crown Estate.  

  

 Plaid Cymru’s Treasury Spokesperson, Ben Lake MP said:  

 

“Once again, this Budget seems likely to fall short of what Wales needs or deserves, because when Westminster does the counting, Wales always loses out.  

 

“The string of U-turns from Labour over the last few weeks has left the public 

wondering what they actually stand for, if anything at all. From income tax rises to the two-child cap, their backtracking leaves little confidence that Wednesday’s Budget will bring clarity, or that Labour themselves have faith in their fiscal strategy.  

 

“But people across Wales are not just looking for stability, they’re looking for ambition that will provide real change to improve their day to day lives. That is what Plaid Cymru’s proposals to the Chancellor are offering, and that is why she should take them seriously ahead of the Budget on Wednesday.   

 

“Wales has lost out on billions from unfair spending decisions made by this Labour UK Government. Plaid Cymru is simply calling for fairness, and for a budget that will  deliver for Wales. From calling for the billions owed to Wales from HS2 to the devolution of the Crown Estate, to demanding action on the cost of living and a rethink of Labour's tax rises on family businesses and farms. 

 

“There is a clear pattern of Wales being treated unfairly. We were promised better with two Labour Governments at both ends of the M4, yet we’re seeing more of the same, with people across Wales bearing the brunt of Labour’s damaging policies. If the Chancellor wanted to meet the needs of people in Wales and match their appetite for real change, then she would listen to Plaid Cymru’s proposals and provide our communities with the tools and the investment they need to thrive.”  

 

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