BBC BLOGS - Betsan's Blog
« Previous | Main | Next »

For Wales see ...

Betsan Powys | 11:15 UK time, Tuesday, 30 March 2010

_47556202_darlingosbornecable226in_pa.jpgSo what did you see last night?

An example of "a cosy London consensus at its worst" as seen through Plaid Cymru eyes?

A fascinating insight into three potential Chancellors' thinking on cutting public spending versus cutting the deficit versus cutting taxes?

Or perhaps you opted for Eastenders, or saw the cosy walls of the pub.

Let me know. For now let me hone in on one thing that we heard.

Labour have signed up to the principle, at least, that we should all share the cost - the enormous cost - of paying for social care. We should all chip in to pay for a new system and we should all, therefore, get something out of that system if and when we need it.

Those in most need will be looked after at home and those in residential care for more than two years will find the government foots the bill. How? Working out the how, brokering an acceptable deal that we will all accept on turning the principle into reality will be the job of a commission.

Is the "death tax" as the Tories dubbed it dead? Not so says Nick Robinson whose take on the debate around social care you can read here.

But what you heard was the next step in the brutal attempt to answer what Nick calls "the vexed question of how to fund social care in England." In other words for "we" read we in England? Up to a point.

In Scotland Alistair Darling's constituents get their social care for free. The point was raised with the man in charge of what happens in England, Andy Burnham, on the radio this morning. He answered with a simple "That's devolution for you" before arguing that each government makes its own decisions and hinting - though stopping short of saying bluntly - that you might get free social care in Scotland but worse treatment from the NHS than you do in England.

And what of Wales. For Wales read England? No. Social care is devolved.

IF in years to come a substantial sum of public money goes into paying for it in England, then yes, there will be a knock-on effect felt in Wales via the Barnett Formula. But it's not by any means that simple.

IF in years to come English voters have to pay more through taxation to foot the bill for social care, then any change to the tax and benefit system will impact on Wales too. We wouldn't be insulated from those changes. If allowances are no longer paid out in England, they'll be cut here too. The purse strings, remember, are held by the Treasury. It'll be up to the Welsh Assembly Government to work out how they deliver social care but the path will be pretty clearly laid out for them by tax and benefit changes made at UK level. The question of whether they follow the same path is already being asked here. It's way off being answered.

What of other figures - mocked and derided - but oft repeated last night?

What about the £11bn efficiency savings over the coming years Mr Darling detailed in his budget? How much of the £11bn will affect Wales? Last week was the first time we heard how much each Whitehall department will be asked to save, so we should be able to work out more about what the impact on Welsh budgets should be?

No, according to Assembly Government officials, we can't work out what the effect will be. Although the Department of Health will take on £4.35bn of those efficiency savings, that doesn't automatically mean that these will result in reductions in what the Assembly Government has to spend, despite health being devolved.

It's all about baselines - the Welsh budget is solely dependent on net movements of Whitehall departmental baselines in devolved areas.

Stick with me here.

Let's say the DoH baseline budget is £104bn. If the Treasury simply lops off £4bn of that as "efficiency savings" then Wales would see a corresponding reduction.

But if the baseline remains at £104bn but the Treasury demand that efficiency savings of £4bn are made within this in order to free up cash for front-line health care from other areas like administration or sick leave, then Wales wouldn't lose any money at all.

Officials in Cardiff Bay have been in contact with the Treasury and have been told that the £11bn efficiency savings are very much seen in the latter way, rather than the former. But until we all see confirmed, net Whitehall departmental baselines from 2011-12 onwards, there is simply no way of telling what the impact will be. It would be surprising if there wasn't an impact on budgets here as a result but we'll have to wait and see.

So for Wales, see - neither England, nor Scotland - but its very own set of extradordinarily difficult spending decisions just waiting to be made.


or register to comment.

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.