Continuing the trend of recent years, the UK economy is predicted to be the fastest major growing economy in the world this year, with 2.1% growth forecast by the Office for Budget Responsibility.
The OBR also forecast that the deficit will fall to 3.5% of GDP this year and 0.7% in 2020/21, the lowest in two decades – and that debt as a proportion of national income will begin falling in 2018-19, for the first time since 2001-02.
However the Labour Welsh Government spending machine has measured success by how much spent, not how well – and continues to whinge about “austerity” rather than acknowledge that this was an inheritance, not a choice, being defined by how much money you have to spend.
They never complained when the previous Labour UK Government pursued light touch financial regulation - and ignored years of warnings that the UK banking system was more exposed to sub-prime debt than anywhere else in the world.
Labour left the UK with the second highest deficit amongst OECD countries and its biggest budget deficit in peacetime history.
They still fail to acknowledge that if you have high debt, that someone else owns you – and that their alternative would generate bigger cuts.
The Chancellor has been able to adopt more flexible rules for the budget deficit now, but only because of spending discipline since 2010 and because we will no longer have to meet the EU requirement to get our overall debt down to 60% of GDP once we leave.
The Autumn Statement was therefore able to acknowledge the need for further stimulus -
- reducing the income tax bill for 1.4 million individuals in Wales in 2017-18, and taking a further 61,000 individuals in Wales out of income tax altogether.
- increasing the Welsh Government’s capital budget for infrastructure spending by over a quarter in real terms to 2020/21.
- and discussing options for a Growth Deal with North Wales.
Proposals for the improvement of the regional transport and economic infrastructure detailed in "A Growth Vision for the Economy of North Wales", developed by the North Wales Economic Ambition Board in partnership with the Mersey Dee Alliance and the Cheshire & Warrington Local Enterprise Partnership, went to both the UK and Welsh Government’s this summer.
The UK Treasury responded by asking the Ambition Board to articulate their strategic priorities and prioritise projects, and the Board is currently working on this.
However, the Welsh Government has dodged my questions about how and whether it has responded to call in the North Wales growth vision document for the devolution of powers by the Welsh Government over employment, taxes, skills and transport, which it states “would boost the economy, jobs and productivity, create at least 120,000 jobs, and boost the value of the local economy from £12.8 billion to £20 billion by 2035.
The UK economy is projected to continue to grow, with unemployment continuing at an eleven year low.
Although Wales has been the fastest growing part of the UK outside London since 2010, it began from bottom position - and is thanks to the policies of economic discipline pursued since the change of UK Government in 2010.
With Labour in charge of economic development in Wales, however, we still have the highest levels of working age worklessness and child poverty in Great Britain – and Wales still produces the lowest value of goods and services per head amongst the 12 UK nations and regions.
The UK Government has published a new draft Charter for Fiscal Responsibility, to ensure that future generations are not burdened with our debt and to restore a borrowing ceiling for stimulus during times of slow down.
The Autumn Statement details the UK Government’s commitment to maintaining fiscal discipline, while recognising the need for investment to drive up productivity and support economic growth.
In response, the CBI stated that its emphasis on R&D and local infrastructure will help businesses in all corners of the UK to invest with greater confidence for the long-term”.
The Institute of Directors stated “This was a sensible and sober Autumn Statement.”
And the British Chambers of Commerce said “The Chancellor’s strong focus on the growth requirements of our cities, regions and nations will not go unnoticed in business communities across the UK”.
Instead of undermining investment and jobs, Labour Welsh Government has a responsibility to try and instil confidence in both the Urban and Rural economies, by embracing and pursuing policies that improve productivity, competitiveness and resilience.