0:00:03 > 0:00:07Today's striking change was to the taxation system.
0:00:07 > 0:00:13From next April, nobody will pay income tax on the first £9,440
0:00:13 > 0:00:14of their income.
0:00:14 > 0:00:19Most benefits are to increase by 1%, less than inflation.
0:00:19 > 0:00:24The scheme to increase tax on petrol tax to 3p a litre has been abolished.
0:00:24 > 0:00:27Public expenditure is to be further pressed,
0:00:27 > 0:00:30with cuts continuing till 2018.
0:00:30 > 0:00:31But will the plans work?
0:00:33 > 0:00:37Today we've had some news which I'm concerned about
0:00:37 > 0:00:39- further cuts to benefits.
0:00:39 > 0:00:43In the last two years we've gone from benefits linked to RPI,
0:00:43 > 0:00:48down to CPI, and now they've been reduced to public sector wages,
0:00:48 > 0:00:49which have been frozen at 1%.
0:00:49 > 0:00:52So if you have a fixed income and live on benefits,
0:00:52 > 0:00:56a tiny sum of money, with inflation, and everybody saying that it
0:00:56 > 0:00:58will go up, something else that the OBR said today -
0:00:58 > 0:01:04those people are unfortunately going to be in a very fragile situation.
0:01:06 > 0:01:10The Assembly Government has been given £227 million
0:01:10 > 0:01:12for extra capital expenditure.
0:01:12 > 0:01:15Corporate tax is down, too,
0:01:15 > 0:01:19and some measures to encourage investment by businesses.
0:01:19 > 0:01:20But it is the health of the economy
0:01:20 > 0:01:24in general that is worrying business people.
0:01:24 > 0:01:31We have heard that they are realistic about the economy.
0:01:31 > 0:01:33They accept that there are financial changes
0:01:33 > 0:01:36and that today's statement is important
0:01:36 > 0:01:41But we need to accept a new model of economic development that accepts
0:01:41 > 0:01:44the fact that things are going to be difficult
0:01:44 > 0:01:46and will be for a long time.
0:01:46 > 0:01:48We have to get used to that,
0:01:48 > 0:01:50and that will be a huge challenge.
0:01:50 > 0:01:53Britain is on the right track,
0:01:53 > 0:01:55and turning back now would be a disaster.
0:01:58 > 0:02:01It is difficult to separate politics from economics.
0:02:01 > 0:02:04The original intention of cutting the annual debt
0:02:04 > 0:02:06by the general election has been dismissed.
0:02:06 > 0:02:10George Osborne now hopes that both sides will accept his statement
0:02:10 > 0:02:13that we are on the right track.
0:02:13 > 0:02:18Though we have to wait until the good times come back.
0:02:18 > 0:02:25Harry, why should people trust the doctor when the medicine has failed?
0:02:25 > 0:02:27I don't think it has failed.
0:02:27 > 0:02:30They just didn't work as fast as we would have liked.
0:02:30 > 0:02:32This isn't how we were supposed to be.
0:02:32 > 0:02:37You don't always get the right plans.
0:02:37 > 0:02:39If you are on your way from Swansea to London
0:02:39 > 0:02:44and you've only reached Bristol after two years,
0:02:44 > 0:02:47it does not mean you should turn back and go to Swansea.
0:02:47 > 0:02:50You carry on. If it takes more time, it takes more time.
0:02:50 > 0:02:52You don't turn back.
0:02:52 > 0:02:55It makes what Labour said, and we all know the words -
0:02:56 > 0:03:00too far too fast, no plan for growth. It makes those criticisms look valid.
0:03:03 > 0:03:06We are somewhere in the middle,
0:03:06 > 0:03:10and I think people in Britain are comfortable with that.
0:03:10 > 0:03:12I think we should have cut fast,
0:03:12 > 0:03:15but you can understand why George Osborne
0:03:18 > 0:03:20has decided not to do that
0:03:20 > 0:03:23They are going to make the cuts much slower
0:03:23 > 0:03:27than they said they would in order to save the economy.
0:03:27 > 0:03:31The economy is not growing as quickly as we hoped,
0:03:31 > 0:03:32but it is recovering.
0:03:32 > 0:03:36But it is growing slower than any other economy.
0:03:36 > 0:03:38No, next year...
0:03:38 > 0:03:41It is growing slower than the Eurozone.
0:03:41 > 0:03:43We have turned the corner.
0:03:43 > 0:03:45We have improved things.
0:03:45 > 0:03:48They are still borrowing.
0:03:48 > 0:03:51They've given the problems away.
0:03:51 > 0:03:53We'll catch up with them nest year.
0:03:53 > 0:03:57We will be growing quicker than France and Germany next year.
0:03:57 > 0:04:01Nia Griffith, there is a lot in this statement
0:04:01 > 0:04:02that you could welcome.
0:04:02 > 0:04:06For example, there is more capital expenditure.
0:04:06 > 0:04:11Everybody will earn more before paying tax.
0:04:11 > 0:04:14Corporation tax will go down. You probably welcome that?
0:04:14 > 0:04:20They are not doing enough to boost growth in the economy.
0:04:20 > 0:04:25They have promised to work on so many projects,
0:04:25 > 0:04:28but we have not started
0:04:31 > 0:04:37any of the infrastructure schemes.
0:04:37 > 0:04:39We will see what they do next year.
0:04:39 > 0:04:44They are still charging 20% VAT on
0:04:44 > 0:04:48everything, including petrol.
0:04:48 > 0:04:50It cancels out one tax.
0:04:53 > 0:04:55I welcome that,
0:04:55 > 0:04:59but we are still paying more VAT than ever before.
0:04:59 > 0:05:02This affects the poorest people.
0:05:04 > 0:05:08But this is due to what your party did.
0:05:08 > 0:05:11We had a new figure today.
0:05:11 > 0:05:15The black hole in 2008, 6.8% of GDP, had a trunk.
0:05:15 > 0:05:16It is bigger than people thought.
0:05:20 > 0:05:21That has surprised many.
0:05:21 > 0:05:23The mess you left was worse than we knew.
0:05:27 > 0:05:34It is not fair that he is giving millionaires their money back.
0:05:34 > 0:05:37But you left a huge black hole in 2008.
0:05:41 > 0:05:43In 2008, we tried to boost the economy.
0:05:46 > 0:05:53We have been out of government since 2010.
0:05:53 > 0:05:55We have left the economy growing.
0:05:57 > 0:06:00That is the difference.
0:06:00 > 0:06:01But there was nothing left.
0:06:01 > 0:06:05You left a note saying sorry, there's nothing left.
0:06:05 > 0:06:07You can't pay anything back
0:06:07 > 0:06:10if you have not made the money in the first place. You have to make
0:06:10 > 0:06:13the money before paying it back.
0:06:13 > 0:06:18He is postponing and postponing the problem.
0:06:21 > 0:06:24He has failed with his policies.
0:06:24 > 0:06:27He has not changed them.
0:06:28 > 0:06:30They are postponing the problem.
0:06:30 > 0:06:33We have seen figures that are going on and on.
0:06:33 > 0:06:38He has said we will have more deficits in the future.
0:06:38 > 0:06:43Let's look at one thing that is important to Wales. There has been a
0:06:43 > 0:06:47row within Westminster about this.
0:06:49 > 0:06:51It seems something is going to happen
0:06:54 > 0:06:57in education, but that has disappeared.
0:06:57 > 0:06:59Is that a victory for your party?
0:06:59 > 0:07:00It is a victory.
0:07:00 > 0:07:04I read page 42 of the statement, and saw that this was not going to happen.
0:07:06 > 0:07:12I was not happy with the idea when it came out in the first place.
0:07:12 > 0:07:14I have talked to a lot of people.
0:07:16 > 0:07:19I am happy that this is not going to happen.
0:07:19 > 0:07:22I am happy that we are going to get £227 million extra,
0:07:26 > 0:07:28but that is consequential money.
0:07:31 > 0:07:33It is coming to the Welsh Government,
0:07:33 > 0:07:35and it is up to them where to spend it.
0:07:35 > 0:07:37I want it spent where jobs will be created.
0:07:37 > 0:07:45Since the Leveson report, where Nick can disagree with the Prime Minister,
0:07:49 > 0:07:51what things did you not like?
0:07:51 > 0:07:54I was disappointed that we did not get a mansion tax.
0:07:54 > 0:08:01It is a way of taxing wealth rather than taxing the poorest people.
0:08:01 > 0:08:04That's a way of taxing wealth, rather than taxing income.
0:08:04 > 0:08:08We know that rich people can hire accountants to move money around.
0:08:09 > 0:08:12If you have a big house that is worth £2 million,
0:08:12 > 0:08:13it is a way of taxing them.
0:08:15 > 0:08:19But the Conservatives did not want to go that way.
0:08:19 > 0:08:23Why not, Harry? Nick Clegg was shaking his head.
0:08:23 > 0:08:27That is a terrible idea, putting a tax on homes.
0:08:27 > 0:08:31If this happens, people who create jobs will not want to live here.
0:08:35 > 0:08:38They will move away.
0:08:38 > 0:08:41You've seen what happened with the 50p tax.
0:08:41 > 0:08:45Half the people who paid it disappeared.
0:08:45 > 0:08:48Are you worried about the people who are earning too much?
0:08:48 > 0:08:52People on lower incomes will suffer more after this autumn statement.
0:08:55 > 0:09:00But over the last two years they've done better every time.
0:09:00 > 0:09:04People who work every day won't see increases in what they earn.
0:09:04 > 0:09:07But those at the bottom have been looked after.
0:09:12 > 0:09:15Really? With the benefits being cut?
0:09:15 > 0:09:18They're going up 1%. I think they should have been frozen.
0:09:20 > 0:09:26To be fair to the Liberal Democrats, they brought that in.
0:09:26 > 0:09:30Let's look at this Christmas present that came to Wales.
0:09:30 > 0:09:33The Barnett formula works in Wales's favour for once.
0:09:33 > 0:09:37We have more capital expenditure for Wales.
0:09:40 > 0:09:42So there is an extra 200 to spend.
0:09:44 > 0:09:49What should Wales spend that money on?
0:09:49 > 0:09:52What will make the difference to the Welsh economy? Nia.
0:09:54 > 0:09:57It is important to put the money in people's pockets.
0:09:57 > 0:10:00People spend money, not just the government.
0:10:04 > 0:10:08This is capital money, things for hospitals, roads, homes, schools.
0:10:08 > 0:10:10Where would you spend the money?
0:10:13 > 0:10:18It is important that we create infrastructure in Wales
0:10:18 > 0:10:19and continue to build.
0:10:19 > 0:10:20This creates jobs.
0:10:22 > 0:10:28But the Chancellor has made sure that people on lower incomes
0:10:28 > 0:10:34are getting increasingly less and prices are going up.
0:10:36 > 0:10:39That's completely unfair.
0:10:39 > 0:10:44The poorest people use their money in the local economy.
0:10:44 > 0:10:49But millionaires take the money out of the country.
0:10:49 > 0:10:55To answer the question, we should build up schools, hospitals.
0:10:55 > 0:10:58I would like schools to be built because we have seen recently
0:10:58 > 0:11:01that some schools have asbestos in them.
0:11:01 > 0:11:07We need to build things in order to boost the construction industry.
0:11:07 > 0:11:09One of the first things the government did
0:11:11 > 0:11:15was stop the capital's schools scheme in England.
0:11:15 > 0:11:20But now they have done a U-turn. You are resorting to Plan B.
0:11:20 > 0:11:24No. You have to persuade people that you can run the economy.
0:11:24 > 0:11:27We have created this credibility.
0:11:31 > 0:11:34It is possible to invest more.
0:11:34 > 0:11:35And what should the government do?
0:11:35 > 0:11:41We have to build new roads and improve our communications systems.
0:11:41 > 0:11:43Thank you very much.
0:11:43 > 0:11:47There was plenty of talk about benefits in Westminster today.
0:11:47 > 0:11:49But in Cardiff, it was about one benefit in particular,
0:11:49 > 0:11:52the Council Tax Benefit Scheme.
0:11:52 > 0:11:56More than 300,000 families in Wales benefit from the payment, but there
0:11:56 > 0:11:59is a danger that they will not receive it next year, due to a
0:11:59 > 0:12:01row between the Welsh Government and the Treasury.
0:12:01 > 0:12:05It could mean that Assembly Members will be recalled here
0:12:05 > 0:12:09over Christmas to make sure next year's payment
0:12:09 > 0:12:13is not delayed. Arwyn Jones explains.
0:12:14 > 0:12:18Sharon O'Neill from Blaenau Ffestiniog is unemployed
0:12:18 > 0:12:22and is one of the 300,000 families in Wales
0:12:22 > 0:12:25that receives council tax benefit.
0:12:25 > 0:12:29It is received for low-income families or those receiving other benefits.
0:12:29 > 0:12:33It can mean they don't pay council tax at all.
0:12:33 > 0:12:41It is very important. Without that, we would not have a home. And not
0:12:41 > 0:12:43just us, but many people.
0:12:46 > 0:12:52That helps us with how much money we get in.
0:12:52 > 0:12:56We could not manage without it.
0:12:56 > 0:13:00From April, the Government has decided
0:13:00 > 0:13:03that local authorities should be responsible for that benefit.
0:13:03 > 0:13:07But the Welsh Government say they have not received enough information
0:13:07 > 0:13:10from the Treasury to introduce the changes.
0:13:11 > 0:13:18The reason why we could not have laid the regulations until now
0:13:18 > 0:13:23is because the UK government only passed the information in November.
0:13:23 > 0:13:26That's only 25 working days to do that.
0:13:26 > 0:13:28So what are the changes?
0:13:28 > 0:13:33We know that the money going into the Council Tax Benefit
0:13:33 > 0:13:35Scheme will be less by about 10%.
0:13:35 > 0:13:41This year, it cost £252 million in Wales.
0:13:41 > 0:13:46You can imagine that next year it will be higher.
0:13:47 > 0:13:52The Welsh Government has said they are not going to put any more money
0:13:52 > 0:13:57into the scheme, so they could tell the councils to give less money to the people receiving the benefits.
0:13:57 > 0:14:00But clearly, that will be difficult to do.
0:14:00 > 0:14:06They could tell councils to increase council tax to find the money,
0:14:06 > 0:14:10or to find it from somewhere else.
0:14:10 > 0:14:13But there is a problem about timing. Everything will have to be
0:14:13 > 0:14:16ready before the end of January.
0:14:16 > 0:14:20And until today, nobody was quite sure
0:14:20 > 0:14:22what the Welsh Government plan was.
0:14:22 > 0:14:26We have been put into an impossible
0:14:26 > 0:14:33situation. We have poor people in our communities who are in danger of
0:14:33 > 0:14:40suffering as a result. We remember what the Labour government said
0:14:40 > 0:14:44during the last election, saying that they would safeguard the Welsh
0:14:44 > 0:14:48people from the Westminster cuts. They have failed in that respect.
0:14:48 > 0:14:51There are poor people who will suffer.
0:14:51 > 0:14:54Things are very different in England.
0:14:54 > 0:14:57Cambridge Council has already taken action.
0:15:00 > 0:15:09Here in Cambridge, they have taken responsibility for the council tax benefit scheme.
0:15:09 > 0:15:13They are in the same situation as the Welsh Government.
0:15:18 > 0:15:22The difference is, everywhere else apart from Wales,
0:15:22 > 0:15:27they have already started to do something about it.
0:15:29 > 0:15:38So here, council tax will be increased, especially on second homes and empty homes.
0:15:38 > 0:15:42According to the former leader of the council, it would be impossible
0:15:42 > 0:15:45for the Welsh Government to get everything in place in time.
0:15:45 > 0:15:53It is a surprise. Every council in England is in the same situation.
0:15:54 > 0:15:57We have decided to work on the information at hand.
0:15:59 > 0:16:09Everybody depends on these results.
0:16:09 > 0:16:11After fears debating tonight,
0:16:11 > 0:16:16the Assembly Members could not agree on the new plan,
0:16:16 > 0:16:20so they will have to be recalled over the Christmas period
0:16:20 > 0:16:22to discuss it further.
0:16:22 > 0:16:27If they can't reach an agreement, people like Sharon will suffer.
0:16:29 > 0:16:34Nia Griffith, we have heard the situation over in England.
0:16:34 > 0:16:36Everybody has sorted this out.
0:16:36 > 0:16:41Why leave it to the last minute here in Wales?
0:16:41 > 0:16:44We have had the figures from the Chancellor.
0:16:45 > 0:16:47They came to us late.
0:16:47 > 0:16:51To be fair to the Labour government in the assembly,
0:16:51 > 0:16:55they have prepared everything they can prepare
0:16:55 > 0:16:56before they got the figures.
0:16:56 > 0:16:58I am confident that they will sort it out.
0:16:58 > 0:17:02But nobody in England had received the figures,
0:17:02 > 0:17:04and they have dealt with the problem.
0:17:04 > 0:17:06They have asked every
0:17:06 > 0:17:12party to support them, and it is disappointing that some people are
0:17:12 > 0:17:14just playing political games.
0:17:16 > 0:17:20But it was 300 pages long. Could you have voted on that?
0:17:20 > 0:17:25The Labour government warned them how long it was.
0:17:27 > 0:17:33There were plenty of opportunities for people to have a look at it.
0:17:33 > 0:17:36It is 340 pages long!
0:17:39 > 0:17:45To give us a week's notice and for us to scrutinise it
0:17:45 > 0:17:54is disgusting. Labour thought that they could push something through
0:17:54 > 0:17:56without discussing it properly.
0:17:56 > 0:17:58I was ashamed of this Labour government.
0:18:02 > 0:18:06What should happen now?
0:18:06 > 0:18:11Nobody wants people to go without these payments.
0:18:11 > 0:18:15Is there a duty for political parties to sit around the table
0:18:15 > 0:18:20and pass some kind of measure to make sure
0:18:20 > 0:18:24these people receive some of the money?
0:18:24 > 0:18:27Yes, it has to be sorted out by the end of January.
0:18:27 > 0:18:29The Assembly has a month off now,
0:18:31 > 0:18:35and I don't see why they can't come back together and sort it
0:18:35 > 0:18:41out over Christmas so everybody knows what is happening.
0:18:41 > 0:18:46Some members here suggested that the Labour Government was picking a
0:18:46 > 0:18:52fight with Westminster. Is there any basis to that?
0:18:52 > 0:18:57No. It is important to have the best for the Welsh people.
0:18:57 > 0:19:01That is what the Labour government wants.
0:19:02 > 0:19:07I am sure they are working hard to ensure that.
0:19:07 > 0:19:11I am sure the opposition leaders will help.
0:19:11 > 0:19:14We were happy to come back.
0:19:14 > 0:19:17Assembly Members were ready to come back and discuss this.
0:19:17 > 0:19:26We want to come back next week in order to scrutinise this.
0:19:26 > 0:19:28We don't want people going without.
0:19:28 > 0:19:30It is embarrassing for the government here.
0:19:30 > 0:19:37But the power has been devolved it with only a percentage of the money.
0:19:41 > 0:19:45The coalition government in Westminster has decided to cut the money.
0:19:45 > 0:19:51They have told us that we have to find the money ourselves.
0:19:51 > 0:19:57It is not a sudden decision. They were told of it two years ago.
0:19:57 > 0:20:01Cuts happen all over the place.
0:20:01 > 0:20:03Everyone is having a hard time.
0:20:03 > 0:20:05They had two years to sort this out,
0:20:05 > 0:20:09but they have left it to the last minute.
0:20:09 > 0:20:16You said how unfair it was that the poorest people are suffering,
0:20:17 > 0:20:22but the majority of people who get this benefit
0:20:22 > 0:20:23have to work hard for a low wage.
0:20:23 > 0:20:28The very people you said were being treated unfairly.
0:20:28 > 0:20:31But they're always seeing increases in what they have.
0:20:32 > 0:20:35Maybe they will not lose out.
0:20:35 > 0:20:40It is down to the Labour government to decide what to do.
0:20:40 > 0:20:42We have already seen in Westminster how much they have saved
0:20:42 > 0:20:45in the Civil Service.
0:20:45 > 0:20:48Perhaps we can do something similar in Cardiff.
0:20:48 > 0:20:53Myrddin Edwards, what about what happens in England?
0:20:53 > 0:20:55Higher taxes on second homes and empty homes?
0:20:55 > 0:21:04We have asked the government here to do the same.
0:21:04 > 0:21:09We have to make sure that people who own empty homes
0:21:09 > 0:21:11pay more council tax.
0:21:11 > 0:21:15We want every local authority to come up with their own ideas.
0:21:15 > 0:21:20We don't want central government to say, this is what you have to do.
0:21:20 > 0:21:22I agree with that idea.
0:21:22 > 0:21:24So what is the answer?
0:21:26 > 0:21:29Is it the Cambridge model?
0:21:29 > 0:21:33I am not sure of the details of what they do there,
0:21:33 > 0:21:39but in Wales, we are losing £2.1 billion over the next three years.
0:21:41 > 0:21:46It is difficult to know where to make the cuts
0:21:46 > 0:21:53when the Westminster government has decided to give us 10% less.
0:21:53 > 0:21:59Many thanks for joining us this evening.
0:21:59 > 0:22:01That is all for tonight.
0:22:01 > 0:22:07- We will be back next week. - Good night.
0:22:21 > 0:22:24Subtitles by Red Bee Media Ltd