CABINET WRITTEN STATEMENT
Title: A Progressive Budget For Wales
Date: 5 November 2007
This budget marks a crucial stage in the development of the One Wales Government. Delivery of our radical and progressive agenda set out in the One Wales agreement rests on a set of spending plans that are robust, deliverable and realistic. They must – and will – provide the necessary investment to make public services in Wales among the best.
One Wales is a definitive statement of what this Government will achieve for the people of Wales. We will continue the transformation of Wales into a self-confident, prosperous and healthy nation. We will redouble our efforts to make a society which is fair to all. This ambition is underpinned by a commitment to the principles of social justice, sustainability and inclusivity. And we can back that ambition with £3.64bn of new investment in public services, taking our spending to over £16bn by 2010-11. This is £2bn more than this year and more than twice the £7bn budget when the Assembly began in 1999.
Assembly Government spending will grow by an average of 1.8% per year in real terms over the next three years. This is slower growth than we have enjoyed in recent years, but is not out of line with the long term trend rate of growth in public spending. It is also higher than spending growth in Scotland and Northern Ireland. But the distribution of this growth across the three years is a key consideration: next year, we have to manage within real terms growth of 0.7%, followed by 2.1% in 2009-10 and 2.6% in 2010-11. This distribution has clearly influenced the allocations we have made in the budget.
This budget should also mark a new way of looking at the impact of our expenditure. We will not be looking simply at the amount we spend, but will also be concentrating on the outcomes from our spending. So the measure of our success in delivering One Wales will not be a crude analysis of how much money has been invested in a particular area, but what we have delivered for the people of Wales as a result of that investment.
Creativity and innovation are essential to continuing to improve delivery and maximise value for money. Doing more of the same will not be sufficient to meet the challenges we face. As a Government, we need to keep our activity under constant review and challenge and to prioritise our limited resources, directing them to where they will have the most impact and where they will best deliver our strategic aims. This is the right thing to do in a tight financial climate and reflects this Government’s preparedness to take difficult decisions where necessary
We will be more efficient and more effective to make the Welsh pound work harder and deliver more for the people of Wales. We will maximise investment in public services over the next three years by making best use of EU structural funds, getting the most out of public assets and attracting private sector investment. And we will improve joining up between different parts of the Assembly Government and between the Assembly Government and its delivery partners.
The One Wales agenda is ambitious and radical but is also realistic and deliverable within the funding available to us over the next few years. Ministerial colleagues will be providing further details of their own spending plans in their areas over the next few days. Among the key elements of the budget package are:
at least £1.2bn more invested in health services, building on record growth in funding in recent years, and continuing to improve service standards and health outcomes;
delivering on our commitment to learning for life, not only by making improvements for children – rolling out the foundation phase for 3 to 7 year olds - but also creating opportunities for people to continue to learn beyond compulsory school age, where we will be substantially increasing the number of apprenticeships;
additional funding to deliver our commitment to making an affordable home a reality for more people;
an enhanced Business Rate Relief Scheme and a new single investment fund to encourage enterprise and business growth;
significant increases in transport investment to improve regional and national transport;
a range of actions on fairness and social justice, including:
extra help for pensioners with paying Council Tax;
a new extra Children’s Bond for all children entering school in Wales;
more places on alcohol and drug rehabilitation programmes;
expanding the provision of affordable childcare; and
access to credit unions for every secondary school in Wales.
tackling the causes and consequences of climate change, including substantial new investment in enhanced recycling services and improving flood defences;
establishing an all-Wales convention to prepare for a referendum and an independent commission on Assembly funding and finance;
a new, more strategic approach to capital investment to ensure spending is focussed on key priorities, backed by significant new investment for capital projects – more than £400m over the next three years;
additional investment in the Welsh language, sport and the arts, including implementing the recommendations of the Stephens Review; and
a programme for eradication of bovine TB.
These proposals are the basis for delivering of this Government’s strategic agenda: time is now required for Assembly Members to understand, scrutinise and question. The new process, which will now commence as a result of the 2006 Government of Wales Act, provides the opportunity for Members to take a balanced and considered view of these proposals, as well as question all Ministers about their plans.
Scrutiny committees will have the opportunity to consider the proposals for each portfolio over the next two weeks and feed in their views to the Finance Committee as appropriate. The Finance Committee will then produce a report on the draft budget at the beginning of December, which will inform a full plenary debate on this draft budget before Christmas recess.
The final budget will be presented to the Assembly in January.
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