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Isherwood: Labour's spend more deliver less budget for Wales

Speech to the National Assembly for Wales

"Looking at the assembled Labour ranks before me, I feel a bit like Daniel in the Lion's Den - but what a mangy looking Pride of Labour wildcats and sourpusses they are!

And sitting amongst them is Finance Tiger Sue Essex, Tigger to the Chancellor's Winnie the Pooh - for, like Winnie, Chancellor Pooh has licked the honey-pot dry. To satisfy his appetite he will now have to tax the bees until their hives are empty and they have buzzed off!

The fact is that the Summer 2004 Cardiff Business School Welsh Economic Review forecasts that the Welsh economy will slow to 2% growth in 2005 and 2006, and that last month the IMF predicted that the UK economy will slow to 2.5% growth next year - well below the 3% - 3.5% forecast in Gordon Brown's March Budget.

The fact is that Gordon Brown is the Lucky Chancellor, having inherited in 1997 the best economy inherited by any Chancellor for decades.

As Cardiff Business School states: 'or much of the 1980s and early 1990s, Wales was one of the most successful regions in the EU in attracting inward investment'

The fact is that Gordon Brown is on course to borrow this year alone more than 3 times as much as he forecast at the last General Election because, despite his 66 tax increases, he got his tax and spend forecasts wrong.

And the scandalous reality is that for all his increases in public spending, the people of Wales have not seen the improvements in public services that they deserve and would expect to see - AND Cardiff Business School states that 'this Welsh Assembly Government's target for prosperity in Wales to reach 90% of the UK average by 2010 appears highly optimistic'.

The economic reality is that Wales in Britain is living on 'the never never' and that if Gordon Brown keeps increasing Public Spending faster than economic growth as more than a short-term measure, there will be a day of reckoning for us all.

That is why the IMF has criticised the Treasury's approach to public finances and called for 'fiscal consolidation', meaning spending cuts or tax increases in 2005.

So this is the real backdrop to Labour's 3-year 'Budget for the Future of Wales' - a 'Credit Card' Budget that promises just 1 year's spending and more jam tomorrow and a credit card budget from a discredited 'spend more, deliver less' Welsh Assembly Government.

Adding 7% to a health budget that has already been increased by nearly 50% does not tackle the problem of a two-tier National "Hutt" Service created by a discredited Health Minister - that is second class service to England and forcing thousands to pay privately.

With overall waiting lists up 85% since 1999 and outpatients waiting more than 6 months up 1100% under Labour - this Minister cannot be trusted to deliver for my constituent, Hilary Jones, waiting 79 weeks for an orthopaedic appointment, my constituent Mr Roberts, waiting 88 weeks despite being threatened with disability, my constituent waiting 64 weeks for a Urology appointment, my constituent waiting 10 months for a quadruple heart bypass and my colleague Laura Ann Jones waiting 78 weeks to see an orthopaedic consultant.

A look at the Education and Lifelong Learning budget teaches us that this is a Minister who believes in selection - because she must be very selective about who she talks to - or is it that she is very selective about who she listens to?

The continued funding of schools and teachers' workload without ring-fencing and through a top-sliced Revenue Support Grant is a betrayal of the countless schools and governors who have written to me at the end of their tether over cuts.

The additional cut in real terms in GEST funding for teacher training is a further betrayal, the increase in early years funding is building houses on sand when it represents less than 2% of school expenditure in Wales, and the increase in the school buildings improvement grant is less than the backlog in my home county of Flintshire alone.

Responding to last year's budget, I asked for an assurance that the increase in further education teacher pay would be funded in full. It wasn't, and last year's 7.4% increase for ELWa generated cuts in jobs, courses and students across the FE sector and deficits in most FE colleges.

On Monday I was in a college in North Wales that was forced to shed 2000 students and at Northop College all teaching staff are having to re-apply for their jobs. The 5.29% increase for ELWa and just £500,000 for 14-19 learning announced in this budget will not therefore remove the cap on growth for widening participation and the NAHT tell me that they can't find anything in the budget to support the 3 year 'cushion' for the substantial sixth form funding changes.

The cut in student support funds, down another 10%, follows my warning last year that this was the cause and effect of the debt burden imposed on students by Labour, hitting those on lowest incomes the hardest.

And, so that our universities may plan ahead in confidence, the Education Minister must now also come clean about the rise in projected reserves to £645.7million in 2007/8 - what does this mean for top up fees in Wales?

The Social Justice and Regeneration budget has increased by just 2% for a second year running - so much for Labour's commitment to social justice and supporting people and so much for the housing crisis in Wales. With new build affordable housing down 78%, first time buyers down 40% and homelessness up under Labour, the increases in this draft budget still leave government funding for Welsh affordable housing at 26% below the level inherited from the Conservatives in 1997.

After deducting pay, prices, pensions, schools, the teacher's workload agreement and Labour's unfunded burdens from the Local Government Settlement, Wales faces worrying Council Tax increases next year - and the spin in Labour's budget document is exposed by the fact that there is no increase in either the Local Government deprivation grant, or performance incentive grant.

The Government claims that it is committed to ensuring that the distribution of resources is done according to need when the reality is that a postcode lottery funds schoolchildren, the vulnerable and the elderly on the basis of where they live, and even the Children's Commissioner has expressed concern about the lack of ring-fenced funding for the National Service Framework for Children.

Funding for the Snowdon summit building is warmly welcomed, as is the increase in Tir Cymru Agri-Environment funding, but we are concerned at the lack of Countryside Council for Wales resources to administer this, after a budget increase of only 2.2%.

Extra funding for animal health and TB is also cautiously welcomed, but the Government must now get to grips with this critical issue and the extra money for the waste strategy is too late to stop the illegal dumping of hazardous waste and damage to biosecurity.

Gordon Brown has allowed the weeds in his backgarden to grow like topsy, but Rhodri Morgan has got the triffids sitting at his cabinet table.

The sooner that the James Commission looks at spending in this place, the better, because with the bureaucracy here now, you can't stop the nonsense because you can't see it. Conservative proposals will take out not 1 nurse, not 1 teacher, not 1 hospital bed, not 1 doctor, not 1 classroom assistant, not 1 ward. Nothing.

However, without a real efficiency drive, Labour's spending spree will go down as one of the most profligate wastes of public money ever - and sooner or later the people of Wales will turn round and ask why all their money has been wasted."

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