Labor leaders in Edinburgh and Cardiff on Wednesday sought credit for the most progressive measures in Rachel Reeves’s budget, and pinned their hopes on a package ahead of next year’s crucial elections that would increase funding for Scotland and Wales by almost £2 billion.
The funding boost and scrapping of the two-child limit for Universal Credit recipients were seen as a relief in both capitals. Scottish Labor leader Anas Sarwar said: “I asked for a Labor budget based on Labor values and that is exactly what the Chancellor has done. This budget means reducing child poverty, reducing energy bills, raising wages and rejecting austerity.”
The Welsh First Minister, Labour’s Alunred Morgan, said: “This is a budget that will help people across Wales. It will mean more money in the pockets of those who need it most.
“We called on the UK Government to continue to support us with more funding for hard-hit public services and they have delivered.”
Opinion polls have consistently suggested that the Scottish and Welsh Labor parties have suffered humiliating defeats in the parliamentary elections held in May, largely due to voter anger over the actions of Keir Starmer’s government in Westminster.
In Scotland, Labor has been in second or third place in the polls, behind the SNP and Reform UK. In Wales, where Labor has dominated for a century, the party is predicted to trail behind plaid Cymru and reform.
The Welsh and Scottish parties lobbied the Prime Minister and Chancellor to counter rising voting support for their opponents, particularly over energy bills and their handling of the cost of living crisis for low-income families.
Sarwar’s optimistic stance was boosted by Scottish TUC leader Rose Foer, a frequent critic of the UK government, who said increases in the national living wage, cutting energy bills, scrapping the “harmful” two-child limit and increasing taxes on the richest were welcome.
“By blocking short-term cuts, the Chancellor will have played Labour’s ‘get out of jail free’ card,” Foer said. “For working people who are still struggling with a pandemic, the living wage crisis and Tory austerity, an increase in the living wage, a cut to their energy bills and a boost to welfare provides a lifeline when they need it most.”
After name-checking Sarwar in his budget speech, Reeves said his decision would release an additional £820 million of funding for the Scottish Government over the next three years.
The Welsh Government will get an extra £1 billion to spend on services and capital projects. Reeves announced a £505 million increase to the Welsh Administration’s budget and it will also be able to borrow more and take extra from its reserves – another £425 million.
Professor Laura McAllister of the Wales Governance Center said she doubted the budget would help Labor in the May elections.
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He said: “It is hard to imagine that the announcements will make any major difference to Welsh Labour’s prospects. Overall, it is a case of too little, too late and while the two-child benefit will be nice, the rest is very intangible.”
The power-sharing government in Northern Ireland will get an extra £370m in funding and capital over the next three years to boost post-Brexit trade with the rest of the UK, plus £16.55m for Stormont.
The Fraser of Allander Institute, an economics think tank at the University of Strathclyde, said scrapping the two-child limit would release an extra £120m for ministers in Edinburgh as their plans to scrap it in Scotland would no longer be needed.
However, Shona Robison, the Finance Secretary for Scotland, insisted that the budget was a “chaotic mess” which failed to deliver on Labour’s promise to cut energy bills by £300m, while increasing its Treasury funding would not cover the cost of meeting the increased National Insurance bill for the public sector.
Robison said the new mileage rates for electric cars would penalize green motorists and disproportionately affect rural drivers. He also said the Chancellor’s refusal to scrap the energy profit levy on North Sea oil and gas would put thousands of jobs at risk.
He welcomed the end of the two-child limit, but said: “The whole chaos over this budget is based on the fact that we should not be leaving important decisions about the economy, public finances and household bills in the hands of a hugely incompetent Westminster UK government.”
The plaid Cymru leader, Rhun ap Iorwerth, said Wales was being given an “incomplete transformation”. He claimed the Treasury was withholding more than £4 billion owed to Wales because it had received no benefits from the HS2 project and made no progress on the transfer of the Crown Estate.
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