PARLIAMENTARY DEBATE
Cost of Living - 31 January 2024 (Commons/Commons Chamber)

The UK Government fully recognise the challenges posed by cost of living pressures that have come about as a result of the covid pandemic and the invasion of Ukraine. That is why they are providing £104 billion over 2022 to 2025 to support households and individuals across the UK—an average of £3,700 per household.

On Monday evening, ITV News featured a Bevan Foundation study on pensioner poverty in Wales. With nearly a quarter of Wales’s population being over 65, more pensioners are experiencing poverty in Wales than anywhere else in the UK. The “make do and mend” generation, who experienced imposed rationing as children, are now self-denying, with one in 10 pensioners skipping meals and one in five going without heating at some point this winter. What do the UK Government intend to do about this dire situation?

The UK Government fully recognise the importance of supporting pensioners. That is why we have committed to the triple lock and made sure that, even through the difficult crises we have faced over the past few years, pensions have risen in line with inflation. On top of that, there has been an extra payment of £300 for pensioners, and the UK Government’s policy of bringing down inflation is going to help everyone in Wales and the UK, including all pensioners. I hope the hon. Lady will agree that that is a much better focus than, for example, bringing in road user charging, which is going to hit pensioners who want to drive cars in Wales.

Citizens Advice Cymru has stated that during 2023, it referred over 21,000 people to food banks in Wales, almost double the number for 2021. What does that say about the impact of the Government’s policies on ordinary people in Wales?

As I have just outlined, the UK Government are absolutely focused on supporting those with the least in Wales and across the United Kingdom. That is why the UK Government’s policy of bringing down inflation to around half has helped everyone, and it is why the UK Government have made sure that benefits have risen in line with inflation. Households where there are benefits have received a £900 payment, and households where there is disability have received a £150 payment. I do not for one moment doubt the fact that many people are facing serious difficulties at the moment, but this Government are committed to helping them. When I visit food banks, I am told that all sorts of people have to go and visit food banks on a temporary basis—they should not be used to score cheap political points.

Welsh Labour’s reduction of business rates relief from 75% to 40% is already having an impact, with small businesses in Wrexham saying that they are going to fold. Despite the UK Government maintaining the rate at 75%, the Welsh Government are focusing more on wasting £140 million on a 20 mph scheme and increasing the number of Senedd politicians. Does the Secretary of State agree that the Welsh Labour Government should focus on what the people of Wales need, not what socialist Senedd politicians want to dictate?

My hon. Friend is absolutely right. It is disgraceful that pubs in Wales are going to be paying, on average, thousands of pounds more in business rates because the Welsh Senedd Government have not passed on the money that has been given to them by the UK Government, and it is disgraceful that small tourism businesses are facing a tourism tax levy. If the Welsh Government want to focus on the priorities of small businesses and communities in Wales, they should indeed scrap the plan to spend £140 million on extra Senedd Members.

Does my right hon. Friend agree that one of the best ways in whichthe Welsh Labour Government can help with the cost of living is by helping businesses create jobs and supporting employers, such as the iconic Lobster Pot on Anglesey, rather than increasing business rates punitively and increasing the number of Senedd Members by a staggering 60%?

My hon. Friend is absolutely right. She is a huge champion of businesses in her constituency, and it is a shame that the Senedd does not look to her example of championing businesses instead of imposing all sorts of extra taxes, while—as she mentioned—wasting money on schemes such as creating extra Senedd Members and bringing in road charging on the M4. Even my own Labour council is suggesting bringing back Severn bridge tolls.

I call the shadow Minister.

Some 8,000 homeowners in Wales face the Tory mortgage bombshell this month, with households projected to pay an extra £240 per month as their fixed-rate deals come to an end. Despite the Conservative party’s opposition, the Welsh Government have put in place measures to prevent repossessions, and a UK Labour Government would require banks to protect homeowners. What is the Secretary of State doing to help homeowners facing massive bills caused by the Conservative party’s economic mismanagement?

The UK Government have put in place a number of measures to support any mortgage holders facing difficulties at the moment, but the most important measure has been to bring down inflation. Inflation actually peaked at a higher rate in Europe than in the United Kingdom. Inflation is now down at 4%—much less than half of what it was previously—which will have a beneficial impact on mortgage interest rates over the longer term. I ask the hon. Lady whether, in all fairness, she thinks that her party’s plans to borrow £28 billion a year, which is going to increase inflation and have a very bad impact on mortgage interest rates, will be good or bad for homeowners?

I call Liz Saville Roberts.

Diolch yn fawr, Llefarydd. The Government’s own estimates warn that new Brexit border checks will increase the cost of fresh imports by £330 million and worsen food inflation. The Secretary of State used to dismiss warnings of Brexit border controls as scare stories. Will he now admit how wrong he was, and recognise that the best way to reduce food inflation, which sits at an eye-watering 8%, would be to rejoin the single market?

I make no apologies for rubbishing the scare stories that came out before Brexit took place. We were told that it was going to lead to the collapse of the economy, to the collapse of house prices, to the end of fresh fruit and veg being sold in shops, and even to no more Magnum ice creams. I think we were even going to run out of Viagra as well at one point. The reality is that none of those scare stories has happened, but it is a bit ironic that the right hon. Lady, the leader of the Plaid Cymru group, is demanding that we rejoin the European Union while at the same time wanting to take Wales out of one of the most successful financial unions—

Order. Secretary of State, I am this way, not that way, and you are getting a little carried away. There are a few more questions, and Liz Saville Roberts has another one for you.

That is a Brexit fantasy, and now we look at the wonder of the UK. Northern Ireland is set to receive over £3 billion and a fairer funding settlement from the Treasury, which I welcome. That includes millions of pounds to help balance budgets. Meanwhile in Wales, councillors face a budget black hole of £646 million, which is set to decimate our social services over the next three years. These cuts will be devastating for people left without resources during the cost of living crisis. As Wales’s man in the Cabinet, what has the Secretary of State done to demand equivalent fair funding for Wales?

First, I must point out to the right hon. Lady that, since leaving the European Union, our growth rate has been better than that of Germany, and our manufacturing has now exceeded that of France. As far as fair funding for Wales is concerned, we receive 20% more per head to spend on devolved services than is spent in England. One thing the right hon. Lady and I might agree on is that it is high time the Welsh Labour Government explained why we have longer waiting lists and lower educational standards, despite having more money to spend on devolved services.