Devolved governments ahead of Westminster on budget cuts

Less than a week after Left Foot Forward reported on a public service-cutting draft budget from the Scottish Government, new developments from the administrations in both Cardiff Bay and Stormont have again highlighted the tough financial decisions that lie ahead.

Speaking on the state of Wales’ finances, First Minister Rhodri Morgan gave a sober assessment of how the Labour/Plaid Cymru coalition government would  address the budget squeeze that was to come.

Morgan, who has dubbed himself “classic Labour,” concluded that that some none essential and failing public sector programmes may have to be cancelled, following a spending review by the Welsh Assembly Government. He admitted the move could lead to a “drop off” in the number of public sector workers. He continued:

“We know we face at least five years, possibly an entire decade, of curbs on the rises in public expenditure.”

Despite raising the need for public sector cuts to meet financial difficulties, Morgan – together with his Plaid Deputy Ieuan Wyn Jones – declined to announce which specific cuts were being planned. Labour’s Welsh Finance Minister, Andrew Davies, will provide greater detail in his forthcoming draft budget for Wales.

Responding to the announcement, Nick Bounre, Leader of the Welsh Conservatives, concluded:

“The First Minister’s statement is typically vague and fails to address the fundamental problem facing public services in Wales – namely the contracting Assembly budget in the next few years.”

Meanwhile, in Belfast, Finance Minister, Sammy Wilson was left embarrassed when the BBC disclosed details of a leaked memo from Mr Wilson to other government departments in the province, calling for spending cuts totalling £370 million, by Christmas. The memo details how cuts would have to be made across the board to balance the books, including £170 million of cuts to capital projects such as roads, hospitals and schools.

Defending the memo, Wilson said that action was needed to ensure a “seamless move into next year’s spending.”

Responding to the contents of the memo, the SDLP’s finance spokesman, Declan O’Loan concluded that the “penny has finally dropped” with the finance minister, declaring that it vindicated a document published last week by the SDLP which identified a £2 billion black hold in the finances of the Northern Ireland Executive. O’Loan continued:

“And even today the respected economist Mike Smyth said there was an urgent need to revisit the budget to identify spending pressures and priorities.”

Coupled with announcements in Scotland, the past week has now seen substantial cuts announced by each of the devolved administrations. While both main parties in Westminster have struggled to spell out details of how to address difficult financial circumstances, Edinburgh, Cardiff and Belfast now appear to be ready to engage with the public on where the axe will fall. We await the level headed, mature debate in London on the inevitable consequences of the measures taken to take the UK out of recession.