Wales: last on the Coalition's list.

I was scared this May when a coalition between the Liberal Democrats and the Conservative Party was declared. I knew that the next few years, at least, would be harsh and bleak. I knew that the Tories, albeit with a weak mandate, would use the deficit to justify the cuts they had been itching to make. Neil Kinnock's words echoed in my ears. 

I hoped that living in Wales, where the Assembly is Labour controlled, would provide a balustrade against the cuts. In Wales, Labour still had a mandate to govern. We lost Cardiff North by just 194 votes but the Tories were expecting to win by thousands, and the results wiped the smirks off their faces. We kept  Swansea West in the face of stiff competition from the Liberal Democrats and we won back the iconic seat of Blaenau Gwent from an Independent. 

Within weeks it became clear that the new government were not interested in Wales and it seems to some that they are deliberately hostile. Our budget fell by £162.5m in May. This was despite the conclusion of the independent Holtham Commission, that Wales is underfunded by £300m a year. The cuts are a third more than the UK average.

This autumn the Conservative controlled government seem to aim more punitive measures at Wales.

First, at the beginning of October the coalition announced that the passport office in Newport was due to close. As it happens, I was being interviewed for a job that day by Paul Flynn, MP for Newport West. He had heard the news an hour or so before it was released to the press, and he spoke emotively to me of the impact that losing 300 good jobs could have in the working class town of Newport. The passport office has been there for over forty years and is the only passport office in Wales. 

New blows would come in November. On the 23rd of November the Chief Secretary to the Treasury, Danny Alexander, visited Cardiff and made the statement that there would be no change to the Barnett formula until the economic crisis is "resolved".


The Barnett formula is the formula from which the money allocated to Wales is decided. Last year Health Minister Edwina Hart memorably declared that "Barnett is bust", as Wales is said to be chronically underfunded.  Despite the fact that funding for education is £500 a child less than England and that Wales has some of the most deprived communities in the UK, the Coalition still seemed to have Wales last on the list.


On the 25th November the UK Transport Minister Philip Hammond scrapped the electrification of the railway line from London to Cardiff and Swansea. The government is continuing to invest £8bn on railways across the country but Wales is missing out. Aside from the unfairness of this, I am fearful of the result this will have on jobs and trade in Wales compared to areas where the railways have been electrified. 


Paul Flynn MP made a statement that along with the closure of the Newport Passport Office, changes to the way S4C is funded and the cancellation of the RAF St Athan project as policies instituted by the UK government that have hurt Wales.


Ministers in the Labour led government in the Senedd last week released the draft of the Welsh budget, doing what they can with the money given from Westminster. Although a lot of commentators have compared it to the release of the Scottish budget, Wales is operating with half of the funding of Scotland and does not have tax varying powers. Wales also chose to plan for the long term, while the Scottish budget only covers up until 2012. 


The Welsh budget was announced by Business and Budget Minister Jane Hutt, and I was relieved to see that it seemed to take a much more fair approach than the Westminster budget. Yvette Cooper has launched a well aimed and bruising attack on the Westminster budget, pointing out how it makes scapegoats of the most vulnerable in society, particularly women. 


Jane Hutt has stepped away from this, retaining and introducing a number of progressive measures. Flagship Assembly policies such as free bus passes, free prescriptions and free hospital car parks have been retained. The EMA that has been controversially scrapped in England will be reinstituted in Wales. This year the Assembly launched a 4.4.m, six year initiative called "Right to be Safe", targeting domestic abuse and they have announced they will not be scrapping this measure. This is an extremely positive measure, especially as incidents of domestic violence tend to rise when the economy is poor. 

The Special Policy Conference held last weekend in Cardiff also established the fact that the Welsh Labour Party is committed to continuing this after the elections in May 2011. A new initiative to help older people to pay for care is in the pipeline. Carwyn Jones also added that, "The people of Wales can be sure of one thing – we will do  everything we can to protect our public services, the vulnerable and the fragile economic recovery, despite the hand we have been ‘dealt’." 


The public seem to be approving of the message that Welsh Labour is sending out. On 25th November an ITV poll placed support for Labour at 44%. Welsh Labour has six months to maintain and improve that result before the Assembly Elections. With some really excellent and high profile candidates such as Julie Morgan and a far more fair and progressive budget that Westminster, that is definitely something we can achieve.

Top 5 Euro Myths dispelled by CLS

Top 5 EU Scare Stories

5.“EU JUDGES WANT SHARIA LAW APPLIED IN BRITISH COURTS” - Daily Mail, April 2009.
This headline gives the Daily Mail a chance to pursue two of its favourite delusions, the idea that Britain is being taken over by Islam, and the idea that Britain is being taken over by the EU. This is interesting because a) The headline refers only to a draft proposal, b) The EU has shelved the plans and c) Britain has opted out anyway. In other words, this will never happen.



4. “EUROPE SPIES ON YOUR PAY AND SAVINGS” - Daily Express, September 2009
The article declares that “EU snoopers” (whoever they might be) are “pressing for sinister new powers to spy on every taxpayer”. In reality Eurofisc, the plan in question, is a proposal for increased co-operation on tackling tax evasion, and would have to be agreed to by all 27 member states in order to become a reality. So not only is the headline not currently true, it may never be true.



3. “EURO MEDDLERS RULE WE CAN'T HAVE MILK JUGS” - Daily Express, February 2010
What happened in real life was rather different. A study by a team of researchers at the University of Valencia found that one-third of the milk served in Spanish restaurants did not meet EU Health regulations due to contamination. Yet someone on planet Express has managed to interpret this as “Euro meddlers” introducing a ban on the British milk jug.



2. “EU TO BAN SELLING EGGS BY THE DOZEN” - Daily Mail, June 2010
Not to be outdone by the Express' riveting milk jug story, the Mail reports the latest British staple under threat from those meddling Brussels bureaucrats. Tory blogger Iain Dale was outraged, declaring, “you couldn't make it up”, but actually you can. In fact that's exactly what the Daily Mail did. A European Parliament statement on the proposed changes in regulation clearly stated that “selling eggs by the dozen will not be banned”. The Mail eventually published a corrective article but instead of admitting error claims that the plans had been changed due to “a backlash by Britain”. Very noble.



1. “EU PLAN TO LIQUIFY CORPSES AND POUR THEM DOWN THE DRAIN” Daily Express, July 2010
The following day, the newspaper printed a letter from reader who “felt sick to my stomach when reading the article” and asserted that “of course, this is all about reducing the amount of carbon dioxide going into the atmosphere. It really does beggar belief”. Indeed it does. Because when the Express said “EU plan” what they actually meant was “Belgium's Flemish Undertakers Association plan”. It's easy to confuse the two. The article has since been removed from the Express website...





Reports courtesy of Tabloid Watch.

Ed Miliband: 'David Cameron wants a return to the days of Tory arrogance'

By Ed Miliband in the Guardian:

This was the week that took the compassion out of David Cameron's claim to compassionate Conservatism. In fact, it was a week that had a feel that my generation and his remember: back to the 1980s.

First, the old argument that there is no alternative has reappeared. No cut is too deep, no reduction in spending too large. If we don't act as the government says, they claim Britain will go the way of Greece. No matter that in every major respect – size of debt ratio, history of debt default, levels of growth – the government took over an economy totally different from Greece.

In fact, Britain entered the recession with the second lowest level of debt in the G7, the economy was growing strongly when we left office, and the fiscal deficit was actually £10bn lower than forecast in the March budget.

Of course the deficit is high and needs to be brought down. Our approach, based on halving it over four years, would bring it down every year. But the idea that we are about to go bankrupt is pure political spin to justify a familiar ideological project of a smaller state.

Second, just as in the 1980s, the government has reduced its economic policy to one objective. For the early 80s monetarist claim about inflation being the only measure of economic success, now read the 2010s claim that the deficit is the only thing that matters.

Any plan for deficit reduction must be part of a plan for economic growth. But all the government offers are cuts which will put half a million public servants out of work and the same number at risk in the private sector, as firms that rely on government contracts feel the squeeze.

Beyond the immediate threats to employment, where is the long-term plan for growth and the jobs of the future? Last week we discovered that 190,000 students who want to go into higher education were turned away. Employment programmes for the young unemployed are being cut, as is support for new industries. Just as the Tories created a lost generation in the 1980s, so we see the same risk today.

Third, what about fairness? The Institute for Fiscal Studies blows apart the government's claims and says that the changes being made are regressive: hitting poorer households on average more than richer ones. It is not just the poor who have been targeted. Families with kids are amongst the biggest losers, and despite being lower paid women lose more than men.

What about the apparent rays of light? We should welcome an idea like the pupil premium in education, but overall there will be sharp cuts in spending on nine out of ten secondary school pupils. And some things being done are way beyond what was attempted in the 1980s.

What does it mean to cut a local authority budget by a quarter? This scale of reduction will go deep into the heart of services that people rely on: the local library, meals on wheels or the local leisure centre.

The arrogant ideological swagger of the 1980s is back, too. The Conservative MPs waving their order papers with apparent joy at the largest spending cuts in a generation. The belief that statistics about fairness can be manipulated without people wising up. And the claim to certainty about our economic prospects in an uncertain world.

But the deepest problem is the pessimism that pervades David Cameron's political project. He has made deficit reduction the judge and jury of everything he stands for. Not building a good economy, not creating a society where people's kids get on, not championing a better environment.

We could have had a different spending review. We could have ensured that we raised more money from the banks that caused the crisis than from cuts in child benefit. With a more measured pace of deficit reduction, there would still have been difficult decisions and cuts. But we would have done more to support the economy, defend frontline services and protect those in need.

Will they get away with the gamble? I don't believe people are up for a dangerous and reckless gamble with our economic future. It is up to people of all political persuasions who fear for Britain's society and our economy to stand up and commit to protect not just our values and ideals but the basics of our social and economic fabric.

Ed Miliband is leader of the Labour party

Setting the record straight

The coalition talks a lot about fairness, the deficit they inherited and the necessity for sharp cuts now- reduce the government and create big society. Ministers and MPs use emotive language and simple arguments, the media and the people have responded well to this. We know the cuts and where they’ll hit but what is the ideology behind the cuts? I’d like to take a closer look at some of the fables ConDem and their spin doctors have created.

• Britain’s debt can be compared to personal debt- this is simply not true as anyone who knows anything about economics will tell you. Britain does not have credit cards, a mortgage or an overdraft. The deficit cannot be solved solely through cutting spending- personal debt can be repaid by cutting outgoings but a country’s economy is far more complex. It is quite concerning that the Chancellor is arguing differently when every economist would laugh at the idea of this comparison. The draconian cuts will cause unemployment and unless the economy begins to expand much, much faster then there will be less people paying taxes and more dependent on the state, therefore greatly reducing the government’s income. If the markets think there will be high unemployment or people will be spending less then they will fail to expand and Britain will go into a double dip recession. My personal accounts cannot cause a recession.
• Britain’s structural deficit was out of control. Before the recession, the country’s deficit was about 2.5%- one of the lowest in the world and far lower than the previous Conservative government. Until the election was called both the Conservatives and the Liberal Democrats agreed with all of Labour’s budgets- the Liberal Democrats actually called for higher spending. During their time in office Labour narrowed the gap between government income and spending in real terms.
• The Coalition was unaware of the size of the deficit until they came in to government. This is perhaps their best trick. Both parties saw the budget set in March and the projections. After the election, the country was £10billion better off than had been predicted. The facts speak for themselves; it is simply a myth ConDem are using to justify breaking their electoral promises. In the lead up to the election, particularly the Liberal Democrats, made several promises they would never have been able to keep, that much was glaringly obvious to anyone who did the sums.
• The recession was caused by the Labour government’s reckless spending and now they deny the deficit exists. The recession was worldwide and began in America. The government could have stemmed the damage by regulating the banks more. Had they listened to the opposition, the situation could have been much worse. The Conservatives called for de-regulation and criticised the government for holding the City back. Labour have admitted their mistakes but ConDem have just rewritten history and deny these things were ever said. ConDem have, rightly, introduced a bank levy but they are taking a serious gamble by making such deep cuts immediately. As for the argument that Labour have not produced an alternative- they did set out a four year plan to get rid of the deficit while protecting the economy and British people. Now in opposition and with a new leader, Labour doesn’t have the resources to compile a detailed plan and haven’t yet had the time but they will be releasing policies in due course. Both parties when in opposition said the same thing but now government demand that this is not good enough. Going back to the Labour government though, by the time they left office the market had grown by 2% (very good) and Brown’s model has been successfully used across Europe. It is a total lie for Osbourne to say Britain was close to bankruptcy, or that the country was close to a Greece-like crisis. These statements are completely unfounded by any stretch of the imagination and are nothing but scare-mongering. The Keynesian model (which Labour prefer) is widely respected by economists, the Neo-classical model (which ConDem are using) is incredibly dangerous. The government is relying massively on a major expansion of the market of which there is no sign currently. The Coalition enjoy reeling off reports which support their budget but fail to recognise how often these bodies are wrong, such as in the case of Ireland. The government is making cuts bigger and deeper than any government since the 1920s and are “saving” more captial  by cutting benefits for the disabled than they are from the bank levy- surely fairness (even by their definition) would increase the levy in order to protect the most vulnerable in society. The Chancellor will need to have a plan B as there is a very real danger of Britain going in to double dip recession. A government cannot pull so much money and jobs out of the market without dire consequences- the Coalition has a lot of work to do if it is going to encourage industry and persuade the markets to continue to expand. Comments such as “jump on the bus to Cardiff” (Ian Duncan Smith) will not stop the unemployment void created, firstly, by the recession, and now, by the government.

And lastly, I’d like to finish on the Coalition’s favourite, although very elusive, word- fairness. Is it fair that the tax payer paid for Cameron’s re-decoration of No.10 although he could obviously afford to pay for it himself? Is it fair that Osbourne spent horrifying amounts on champagne for his party when he became Chancellor but is cutting benefits for the disabled? But most importantly, is it fair that the Coalition keep telling the electorate all the lies I’ve listed above? If the Coalition is to continue its popularity, it must be truthful with the electorate and provide the real reason behind their choices. Reducing the deficit is not an ideology, it is a consequence of an underlying ideology, there is a belief the Coalition hold that informs their choices but who knows what it is? Just citing ‘fairness’ is not enough- what is the Coalition’s definition of fairness?

            The task for Labour now is to expose the myths of the Coalition and hold the government accountable, to keep fighting for the most vulnerable in society who will be hit hardest by the cuts. Speaking to Cardiff University’s Labour students on Friday night, Kevin Brennan (MP for Cardiff West), encouraged students to keep fighting for Labour, particularly in the run up to the AM elections and referendums next May. ConDem is using a simple argument, while Labour’s is subtle- for now this simple argument is working but when the cuts start to bite and people realize the true extent of the public spending cuts, Labour must be there, providing a credible alternative which will restore the people’s faith in their party.