The Chancellor confirmed today that the proposed reductions in public expenditure will continue over the next few years and that they will impact on local public services. The Chancellor’s forecast for growth this year has also been revised downwards as predicted by the WLGA in a report commissioned from the Institute of Fiscal Studies last autumn. This present a gloomy picture for Welsh public services and in the light of forthcoming cuts to welfare budgets the prognosis for our communities is of deepening tough times ahead.
Councillor Aaron Shotton (Flintshire), WLGA Spokesperson for Finance and Resources said:
“The impact here in Wales will become clearer after the next spending round in June. As the senior economist John Van Reenen, Head of the LSE's Centre for Economic Performance has stated: "The speed of spending cuts is too fast, and it has contributed to the economy's pathetic rate of recovery"
The outlook is bleak given that the announcement yesterday that public spending on day to day activity will continue to reduce over the coming years. Reductions to the Welsh Block were already set out in the Chancellors Autumn Statement. Local public services in a number of areas including education and early intervention, roads and transport, planning, and housing are proven activities that influence economic growth in a positive way.
“Many people will face further reductions in living standards in the coming years. Changes to the welfare system will mean that some of the most vulnerable people in our communities are going to be left high and dry at a time when local public services will be squeezed as never before. This Budget is a missed opportunity but along with colleagues from across Wales, Councils will step up to the plate and support growth and services in our local areas.
Councillor Anthony Hunt (Torfaen), WLGA Deputy Spokesperson for Finance and Resources said:
“The UK Government is at the last chance saloon for getting the economy back on track and instead it has tinkered at the edges. Additional investment in capital spending is welcomed but it falls well short of the scale that was called for by a number of business and economic commentators. The ratings agencies obviously see growth as a problem. The Chancellor’s frank admission about the appalling prospects for economic growth means that the austerity path down which we are all being taken on is clearly failing. The UK Government’s failure to get a grip of the economy means that Councils will continue to face difficult decisions for years to come.