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Cost of Living

Volume 749: debated on Wednesday 8 May 2024

3. What recent discussions he has had with Cabinet colleagues on the cost of living in Wales. (902649)

12. What recent assessment he has made of the impact of increases in the cost of living on people in Wales. (902658)

The UK Government fully recognise the challenges posed by cost of living pressures that have come about as a result of covid and the invasion of Ukraine. That is why they have committed to the triple lock on pensions for this Parliament, increased the living wage, benefiting 140,000 people in Wales, and put an average £701 back into the pocket of a typical worker in Wales through national insurance cuts.

The Trussell Trust says that one fifth of people in Wales have cut back on or skipped meals in the last 12 months. What conversations is the Secretary of State having with supermarkets about holding down the cost of food for customers?

I know that many supermarkets are supporting food banks within their local areas, and the UK Government have certainly supported those with the least by making sure that pensions, benefits and the minimum wage all go up in line with inflation, and making extra payments on top to pensioners, those on benefits and households where there is disability. However, if the hon. Lady is truly concerned about cost of living pressures in Wales, perhaps she ought to ask her colleagues in the Welsh Labour Government why, on this very day, Welsh Labour Ministers are supporting a plan to create dozens of extra Senedd Members at a cost of £120 million—all money that could be far better spent on supporting those with the least.

Is the Secretary of State aware of a study by Citizens Advice Cymru indicating that more than half a million people in Wales are struggling to make ends meet? If he is aware, what is he doing about it?

I have already outlined the extra payments that are being made to pensioners and those on benefits and disability, and the fact that pensions, benefits and the minimum wage have all gone up in line with inflation. On top of that, the UK Government have delivered five towns funds, four growth deals, three rounds of levelling-up funding, two investment zones, two freeports, an electric arc furnace in south Wales and an electrified rail line in north Wales—and what are we getting from the Welsh Labour Government? We are getting £120 million spent on extra Senedd Members. While we level up the economy, they want to level up the number of politicians in Cardiff Bay.

The Secretary of State mentioned Ukraine and covid as contributing factors to the cost of living crisis, but he forgot to mention Brexit—or is he going to try to argue that Brexit has somehow improved things and made goods and services cheaper for people in Wales?

I would be only too delighted to mention Brexit, which was voted for by a majority of the United Kingdom and a majority in Wales, and point out to the hon. Gentleman that since Brexit the UK has grown faster than France and Germany. I could also mention wasting money on Scottish embassies all around the world, trying to build ferries that have not yet been floated anywhere, raising taxes and trying to shut down the oil and gas industry in Scotland as measures that are unlikely to help with cost of living pressures in Scotland.

The Development Bank of Wales is supposed to be aiding businesses through cost of living pressures. Does my right hon. Friend agree that it is unacceptable that one company received £400,000 from the bank, and was then able to give the First Minister of Wales £200,000?

My hon. Friend raises a very interesting point here. The Development Bank of Wales, which is owned ultimately by the Welsh taxpayers, should be there to support businesses through cost of living pressures. It was able to make a £400,000 loan to a company that was then able to turn round and add £200,000 back into a political donation to enable the First Minister to win the Welsh Labour leadership election. It is a very good question, but it is not a question for me; it is one that should be answered by those on the shadow Front Bench. On this matter, they have been very silent indeed.

Small businesses, particularly those in retail and hospitality, are directly affected by cost of living challenges coming from covid and the energy price spike from the Ukraine conflict. The Chancellor has, therefore, introduced a 75% business rate relief scheme in England, which is supporting businesses in England. Does my right hon. Friend the Secretary of State share my concern that that funding is not being used to the same degree in Wales, and that business rates in Wales are only being relieved at a rate of 40%, so businesses are paying more in tax?

My right hon. Friend is absolutely right. The UK Government made certain that the money for the business rate discount was passed on to the Welsh Labour Government, but instead of passing it on to the pubs, restaurants and small businesses that are so vital to communities in Wales, they have decided to spend it on other matters, such as the one they are voting on today. As a result, the average pub in Wales is paying thousands more in business rates than a pub just across the border in England. That is absolutely scandalous, and I urge the Welsh Labour Government to think about where their priorities are.

No contrition, then, in any of those answers from the Secretary of State, whose party has, by freezing tax thresholds, piled on £960 extra on average to the tax bills of around 400,000 pensioners in Wales. The Prime Minister has now made a totally unfunded £46 billion promise to scrap national insurance. Will the Secretary of State tell us how on earth the Government will pay for that, and will he rule out raising income tax by 8p or scrapping winter fuel payments to do so?

We have made it clear that we want to keep the triple lock to ensure that pensions continue to increase in line with inflation. We will be able to afford that by ensuring that we get growth in the economy, which is why we wanted to end the double taxation system of making those in work pay extra money through national insurance tax. We have also made it clear that we will make tax cuts only when we can afford them, because on the Conservative side of the House, we do not believe in making unfunded promises in order to buy votes.

More than one in four children in Wales lives in poverty. Devolution has the capacity to transform people’s lives, but the current First Minister is distracted by questions about his integrity, deleting messages and taking dodgy donations. After 25 years since the start of devolution, does the Secretary of State agree that Governments at both ends of the M4 need to recommit to integrity and transparency?

I can absolutely assure the right hon. Lady that this Government, and the Conservative party, are completely committed to integrity—[Interruption.] Labour Members are laughing, but their own First Minister took £200,000 from a convicted criminal—one who had received £400,000 from a bank for which the First Minister is responsible—and told the covid committee that all the messages on his phone had been accidentally deleted by the IT department, but now we see a screenshot in which he urges people to delete their messages so that they cannot be subject to a freedom of information request. Labour Members have the audacity to sit there laughing when people ask questions about standards. I say that the right hon. Lady makes a very good point: let us collapse the coalition and stop supporting the Welsh Labour Government, and then we can get a decent Government with decent values running Wales.

My party seeks to make a difference to the lives of the people of Wales, but the Secretary of State and I are in agreement for once when it comes to his judgments in relation to the First Minister. It screams hypocrisy, however, because the Tories in the Senedd voted against a Plaid Cymru motion to set a cap on political donations, and his party has still not returned a £10 million donation from a man who made racist and misogynistic remarks. In that spirit of open democracy, will he support a cap on donations to political parties?

I will not sit here and start making policy on the hoof, but I say to the right hon. Lady—and I think she would agree—that I would not have taken hundreds of thousands of pounds in donations from somebody who had been convicted twice of environmental offences. If Labour Members are happy with that, it is a matter for them.