Latest Public Sector News

25.08.15

Welsh, Scottish and NI finance ministers warn against ‘too fast, too far’ austerity

Finance ministers from all three UK devolved administrations issued a warning that austerity plans present “unnecessary risks to our public services” after a “deeply unfair” Summer Budget.

In a joint statement to Treasury chief secretary Greg Hands MP, the ministers from Scotland, Wales and Northern Ireland said George Osborne’s ongoing cuts would dramatically reduce public spending “too fast and too far”.

The letter – signed by Scotland’s deputy first minister John Swinney, Arlene Foster of the Northern Ireland Executive and Jane Hutt for the Welsh government – called for “early engagement” in the spending review process.

Swinney said: “The UK government’s broken austerity programme is reducing household income, damaging economic confidence and weakening public finances. That represents a clear threat to our public services.

“The recent Budget was misguided and deeply unfair, with disproportionate cuts falling on the poorest and most vulnerable sections of society, while giving tax breaks to the better-off.”

He added that the upcoming announcement of the spending review on 25 November leaves little time for setting their own budgets before 2016-17 – “presenting significantly operational challenges and potentially constraining the time available for parliamentary process”.

They are calling for better communication to help them understand “as fully and as early as possible” the shape of funding settlements intended for the spending review.

“The Scottish government will continue to argue against the failed austerity programme and speak up for the policies to promote economic growth, protect our public services and help the most vulnerable in society,” he added.

Ministers stated in the letter than government Summer Budget plans were developed and communicated in an “unsatisfactory way”, lacking advance notice and consideration of the effects on devolved administrations.

They stated that having the same situation before the Spending Review posed “considerable” difficulties for delivery bodies and stakeholders, who would also be affected by the short notice of future allocations.

The finance ministers from the three administrations have not met Hands (or his predecessor Danny Alexander) jointly since November 2013.

As a result, they have proposed an early four-way meeting “as soon as possible” after the summer recess to discuss issues.

“This should include plans for updating inter-governmental fiscal arrangements. As you will know, the Statement of Funding Policy was last updated in 2010, and there have been significant changes since then, including devolution of taxes and new borrowing powers,” they added.

(Top image c. David Cheskin, PA Images)

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