Wales politics

Welsh Government spending not back to pre-austerity levels until 2023

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Image caption The Cardiff University analysis uses UK Treasury spending predictions

Spending on public services will not return to pre-austerity levels until 2023, 13 years after the cuts began, analysis of the Welsh budget indicates.

Welsh ministers' budget is predicted to continue growing, largely due to extra health spending by the UK government.

But many Welsh Government departments could see further cuts if more money is set aside for the NHS.

Cardiff University researchers said trying to match English health spending would mean tough decisions in Wales.

Austerity began in 2010 when the UK government embarked on deep cuts in public spending.

After accounting for inflation, the portion of Wales' budget for day-to-day spending on services is still lower than it was eight years ago.

It contrasts with the first 10 years of devolution, from 1999, when there was a big increase in the budget.

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Image caption There is still less money in Welsh devolved public services than eight years ago

Guto Ifan, of Cardiff's Wales Governance Centre, said: "The day-to-day spending of the Welsh Government will increase over the next five years, but if you put it in a longer-term perspective, day-to-day departmental spending by the Welsh Government won't reach its 2010 levels in real terms before 2023.

"So that's 13 years of stagnation in day-to-day spending by the Welsh Government which perhaps puts the mantra of an end to austerity into perspective."

He added that because the population has grown during that period, per-person spending will still not have recovered.

The analysis uses spending predictions from the UK Treasury. Chancellor Philip Hammond is expect to undertake a full spending review next year, which will set the tone for government spending after Brexit.

'Arms race'

Theresa May has declared that austerity is over, but Welsh Finance Secretary Mark Drakeford has said there is no evidence of that.

Mr Drakeford now has powers to vary some taxes and to borrow money, but Labour has promised not to change income tax rates in Wales before the 2021 assembly election.

Steve Thomas, chief executive of the Welsh Local Government Association, said the Welsh and UK governments "seem to be in a spending arms race on who can spend most on the national health service".

Money should be spent preventative services that help keep people healthy, he said, such as housing, leisure centres and social care.

"I think the debate on spending in Wales at the moment is one dimensional - it's how much we can invest in the health service," he said in an interview at the assembly.

"And the danger is this place - the Welsh Government - becomes the Cardiff Bay strategic health authority".

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