05/12/2012 CF99

Today's striking change was to the taxation system.

From next April, nobody will pay income tax on the first £9,440

of their income.

Most benefits are to increase by 1%, less than inflation.

The scheme to increase tax on petrol tax to 3p a litre has been abolished.

Public expenditure is to be further pressed,

with cuts continuing till 2018.

But will the plans work?

Today we've had some news which I'm concerned about

- further cuts to benefits.

In the last two years we've gone from benefits linked to RPI,

down to CPI, and now they've been reduced to public sector wages,

which have been frozen at 1%.

So if you have a fixed income and live on benefits,

a tiny sum of money, with inflation, and everybody saying that it

will go up, something else that the OBR said today -

those people are unfortunately going to be in a very fragile situation.

The Assembly Government has been given £227 million

for extra capital expenditure.

Corporate tax is down, too,

and some measures to encourage investment by businesses.

But it is the health of the economy

in general that is worrying business people.

We have heard that they are realistic about the economy.

They accept that there are financial changes

and that today's statement is important

But we need to accept a new model of economic development that accepts

the fact that things are going to be difficult

and will be for a long time.

We have to get used to that,

and that will be a huge challenge.

Britain is on the right track,

and turning back now would be a disaster.

It is difficult to separate politics from economics.

The original intention of cutting the annual debt

by the general election has been dismissed.

George Osborne now hopes that both sides will accept his statement

that we are on the right track.

Though we have to wait until the good times come back.

Harry, why should people trust the doctor when the medicine has failed?

I don't think it has failed.

They just didn't work as fast as we would have liked.

This isn't how we were supposed to be.

You don't always get the right plans.

If you are on your way from Swansea to London

and you've only reached Bristol after two years,

it does not mean you should turn back and go to Swansea.

You carry on. If it takes more time, it takes more time.

You don't turn back.

It makes what Labour said, and we all know the words -

too far too fast, no plan for growth. It makes those criticisms look valid.

We are somewhere in the middle,

and I think people in Britain are comfortable with that.

I think we should have cut fast,

but you can understand why George Osborne

has decided not to do that

They are going to make the cuts much slower

than they said they would in order to save the economy.

The economy is not growing as quickly as we hoped,

but it is recovering.

But it is growing slower than any other economy.

No, next year...

It is growing slower than the Eurozone.

We have turned the corner.

We have improved things.

They are still borrowing.

They've given the problems away.

We'll catch up with them nest year.

We will be growing quicker than France and Germany next year.

Nia Griffith, there is a lot in this statement

that you could welcome.

For example, there is more capital expenditure.

Everybody will earn more before paying tax.

Corporation tax will go down. You probably welcome that?

They are not doing enough to boost growth in the economy.

They have promised to work on so many projects,

but we have not started

any of the infrastructure schemes.

We will see what they do next year.

They are still charging 20% VAT on

everything, including petrol.

It cancels out one tax.

I welcome that,

but we are still paying more VAT than ever before.

This affects the poorest people.

But this is due to what your party did.

We had a new figure today.

The black hole in 2008, 6.8% of GDP, had a trunk.

It is bigger than people thought.

That has surprised many.

The mess you left was worse than we knew.

It is not fair that he is giving millionaires their money back.

But you left a huge black hole in 2008.

In 2008, we tried to boost the economy.

We have been out of government since 2010.

We have left the economy growing.

That is the difference.

But there was nothing left.

You left a note saying sorry, there's nothing left.

You can't pay anything back

if you have not made the money in the first place. You have to make

the money before paying it back.

He is postponing and postponing the problem.

He has failed with his policies.

He has not changed them.

They are postponing the problem.

We have seen figures that are going on and on.

He has said we will have more deficits in the future.

Let's look at one thing that is important to Wales. There has been a

row within Westminster about this.

It seems something is going to happen

in education, but that has disappeared.

Is that a victory for your party?

It is a victory.

I read page 42 of the statement, and saw that this was not going to happen.

I was not happy with the idea when it came out in the first place.

I have talked to a lot of people.

I am happy that this is not going to happen.

I am happy that we are going to get £227 million extra,

but that is consequential money.

It is coming to the Welsh Government,

and it is up to them where to spend it.

I want it spent where jobs will be created.

Since the Leveson report, where Nick can disagree with the Prime Minister,

what things did you not like?

I was disappointed that we did not get a mansion tax.

It is a way of taxing wealth rather than taxing the poorest people.

That's a way of taxing wealth, rather than taxing income.

We know that rich people can hire accountants to move money around.

If you have a big house that is worth £2 million,

it is a way of taxing them.

But the Conservatives did not want to go that way.

Why not, Harry? Nick Clegg was shaking his head.

That is a terrible idea, putting a tax on homes.

If this happens, people who create jobs will not want to live here.

They will move away.

You've seen what happened with the 50p tax.

Half the people who paid it disappeared.

Are you worried about the people who are earning too much?

People on lower incomes will suffer more after this autumn statement.

But over the last two years they've done better every time.

People who work every day won't see increases in what they earn.

But those at the bottom have been looked after.

Really? With the benefits being cut?

They're going up 1%. I think they should have been frozen.

To be fair to the Liberal Democrats, they brought that in.

Let's look at this Christmas present that came to Wales.

The Barnett formula works in Wales's favour for once.

We have more capital expenditure for Wales.

So there is an extra 200 to spend.

What should Wales spend that money on?

What will make the difference to the Welsh economy? Nia.

It is important to put the money in people's pockets.

People spend money, not just the government.

This is capital money, things for hospitals, roads, homes, schools.

Where would you spend the money?

It is important that we create infrastructure in Wales

and continue to build.

This creates jobs.

But the Chancellor has made sure that people on lower incomes

are getting increasingly less and prices are going up.

That's completely unfair.

The poorest people use their money in the local economy.

But millionaires take the money out of the country.

To answer the question, we should build up schools, hospitals.

I would like schools to be built because we have seen recently

that some schools have asbestos in them.

We need to build things in order to boost the construction industry.

One of the first things the government did

was stop the capital's schools scheme in England.

But now they have done a U-turn. You are resorting to Plan B.

No. You have to persuade people that you can run the economy.

We have created this credibility.

It is possible to invest more.

And what should the government do?

We have to build new roads and improve our communications systems.

Thank you very much.

There was plenty of talk about benefits in Westminster today.

But in Cardiff, it was about one benefit in particular,

the Council Tax Benefit Scheme.

More than 300,000 families in Wales benefit from the payment, but there

is a danger that they will not receive it next year, due to a

row between the Welsh Government and the Treasury.

It could mean that Assembly Members will be recalled here

over Christmas to make sure next year's payment

is not delayed. Arwyn Jones explains.

Sharon O'Neill from Blaenau Ffestiniog is unemployed

and is one of the 300,000 families in Wales

that receives council tax benefit.

It is received for low-income families or those receiving other benefits.

It can mean they don't pay council tax at all.

It is very important. Without that, we would not have a home. And not

just us, but many people.

That helps us with how much money we get in.

We could not manage without it.

From April, the Government has decided

that local authorities should be responsible for that benefit.

But the Welsh Government say they have not received enough information

from the Treasury to introduce the changes.

The reason why we could not have laid the regulations until now

is because the UK government only passed the information in November.

That's only 25 working days to do that.

So what are the changes?

We know that the money going into the Council Tax Benefit

Scheme will be less by about 10%.

This year, it cost £252 million in Wales.

You can imagine that next year it will be higher.

The Welsh Government has said they are not going to put any more money

into the scheme, so they could tell the councils to give less money to the people receiving the benefits.

But clearly, that will be difficult to do.

They could tell councils to increase council tax to find the money,

or to find it from somewhere else.

But there is a problem about timing. Everything will have to be

ready before the end of January.

And until today, nobody was quite sure

what the Welsh Government plan was.

We have been put into an impossible

situation. We have poor people in our communities who are in danger of

suffering as a result. We remember what the Labour government said

during the last election, saying that they would safeguard the Welsh

people from the Westminster cuts. They have failed in that respect.

There are poor people who will suffer.

Things are very different in England.

Cambridge Council has already taken action.

Here in Cambridge, they have taken responsibility for the council tax benefit scheme.

They are in the same situation as the Welsh Government.

The difference is, everywhere else apart from Wales,

they have already started to do something about it.

So here, council tax will be increased, especially on second homes and empty homes.

According to the former leader of the council, it would be impossible

for the Welsh Government to get everything in place in time.

It is a surprise. Every council in England is in the same situation.

We have decided to work on the information at hand.

Everybody depends on these results.

After fears debating tonight,

the Assembly Members could not agree on the new plan,

so they will have to be recalled over the Christmas period

to discuss it further.

If they can't reach an agreement, people like Sharon will suffer.

Nia Griffith, we have heard the situation over in England.

Everybody has sorted this out.

Why leave it to the last minute here in Wales?

We have had the figures from the Chancellor.

They came to us late.

To be fair to the Labour government in the assembly,

they have prepared everything they can prepare

before they got the figures.

I am confident that they will sort it out.

But nobody in England had received the figures,

and they have dealt with the problem.

They have asked every

party to support them, and it is disappointing that some people are

just playing political games.

But it was 300 pages long. Could you have voted on that?

The Labour government warned them how long it was.

There were plenty of opportunities for people to have a look at it.

It is 340 pages long!

To give us a week's notice and for us to scrutinise it

is disgusting. Labour thought that they could push something through

without discussing it properly.

I was ashamed of this Labour government.

What should happen now?

Nobody wants people to go without these payments.

Is there a duty for political parties to sit around the table

and pass some kind of measure to make sure

these people receive some of the money?

Yes, it has to be sorted out by the end of January.

The Assembly has a month off now,

and I don't see why they can't come back together and sort it

out over Christmas so everybody knows what is happening.

Some members here suggested that the Labour Government was picking a

fight with Westminster. Is there any basis to that?

No. It is important to have the best for the Welsh people.

That is what the Labour government wants.

I am sure they are working hard to ensure that.

I am sure the opposition leaders will help.

We were happy to come back.

Assembly Members were ready to come back and discuss this.

We want to come back next week in order to scrutinise this.

We don't want people going without.

It is embarrassing for the government here.

But the power has been devolved it with only a percentage of the money.

The coalition government in Westminster has decided to cut the money.

They have told us that we have to find the money ourselves.

It is not a sudden decision. They were told of it two years ago.

Cuts happen all over the place.

Everyone is having a hard time.

They had two years to sort this out,

but they have left it to the last minute.

You said how unfair it was that the poorest people are suffering,

but the majority of people who get this benefit

have to work hard for a low wage.

The very people you said were being treated unfairly.

But they're always seeing increases in what they have.

Maybe they will not lose out.

It is down to the Labour government to decide what to do.

We have already seen in Westminster how much they have saved

in the Civil Service.

Perhaps we can do something similar in Cardiff.

Myrddin Edwards, what about what happens in England?

Higher taxes on second homes and empty homes?

We have asked the government here to do the same.

We have to make sure that people who own empty homes

pay more council tax.

We want every local authority to come up with their own ideas.

We don't want central government to say, this is what you have to do.

I agree with that idea.

So what is the answer?

Is it the Cambridge model?

I am not sure of the details of what they do there,

but in Wales, we are losing £2.1 billion over the next three years.

It is difficult to know where to make the cuts

when the Westminster government has decided to give us 10% less.

Many thanks for joining us this evening.

That is all for tonight.

-We will be back next week.

-Good night.

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