Jane Hutt says Wales to get £1.4m budget refund

Image caption, Jane Hutt and Danny Alexander were meeting at the Commons

A "positive and constructive" meeting to discuss Wales' contribution to cutting the UK's deficit has been held.

Budget Minister Jane Hutt met the chief secretary to the Treasury in London.

During the meeting, Ms Hutt said Danny Alexander agreed to reverse a cut in Wales' budget - worth £1.4m - which related to savings in the 2012 Olympics budget.

Ms Hutt said this was a "relatively small part" of the overall £187m cut but was "good news for Wales".

Mr Alexander had agreed Wales should not be penalised for a cut in a budget from which it derived no benefit.

After the meeting at the House of Commons, Ms Hutt said: "One very newsworthy achievement he agreed we should not be penalised in terms of a consequential cut we were going to get in terms of the Olympics.

"For me that was a good result of that meeting."

She added: "It does demonstrate the fact that he recognises we need a constructive relationship where when things are not right he put them right straight away in terms of that agreement with me today."

But Wales still faces an overall reduction to its budget of £187m following the meeting. This will amount to a net £162.5m cut due to savings elsewhere.

Ms Hutt is now hoping to get more clarification on finances in the new chancellor's Budget in two weeks.

That would then enable the assembly government to decide whether or not to defer this year's cuts in its budget.

She said that Mr Alexander showed an interest in the Holtham Commission report, that suggests Wales is under-funded, and would be happy to meet Gerry Holtham.

The coalition government at Westminster has insisted that any change to the way Wales is funded must await a referendum on assembly powers.

Ms Hutt said Mr Alexander acknowledged the decision on whether to defer cuts was "a very difficult one" as ministers looked to protect the economic recovery and it should not be rushed.

He was also ready to consider the flexibility needed to manage the cuts.

Ms Hutt said the assembly government had already made savings in most of the areas highlighted by the UK Government in its announcement on 24 May.

Image caption, First Minister Carwyn Jones (right) joined ministers from Northern Ireland and Scotland for a meeting in Downing Street on Tuesday

It comes a day after David Cameron hosted a Downing Street meeting with the leaders of the various administrations, including Carwyn Jones.

The prime minister told Welsh ministers they would be consulted over the review of public spending, but must face up to cuts.

Deputy Prime Minister Nick Clegg also attended first plenary session of the Joint Ministerial Council (JMC) since the new UK coalition government came to power.

The economy was at the heart of the talks.

"Ministers discussed the impact of the recession on their administrations and of the planned expenditure cuts affecting each administration," a joint statement said afterwards.

Meanwhile, Welsh Conservative leader Nick Bourne attacked the assembly government, claiming it had failed to plan ahead for its budget for this financial year.

Speaking during first minister's question time, Mr Bourne: "It would seem that she [Ms Hutt] and her officials have failed to make meaningful contingency plans prior to the government being formed.

He added: "If the minister and her colleagues failed to plan for a change of government, then this was grossly irresponsible."

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