Covid-19: ‘Labour’s borrow-and-spend policy is neither bold, nor innovative, but potentially dangerous’

The Shadow Finance Minister, Nick Ramsay MS, has expressed his concern at the Supplementary Budget announced today (May 27), describing elements of it as “potentially dangerous”.

The Supplementary Budget was brought forward to detail how the Welsh Government will allocate £2.4 billion – £2.2bn of it directly from the Treasury, with the rest from the Wales Covid Reserve and repurposed EU funding – dedicated to mitigating the effects of the Coronavirus pandemic and lockdown.

Mr Ramsay recognised that steps had been taken to divert funds from less essential areas to the vital ones – such as from the Major Events Fund to health, but said:

“We had called for a full, Emergency Budget, but were prepared to settle for a Supplementary Budget, and would have welcomed elements of it had Labour’s tried, tested, and failed policy of borrow and spend to the hilt not been the only idea.

“Earlier today, I said that a bold and innovative budget is required to mitigate the effects of the pandemic – especially for the health sector and the economy – but what we have been presented with lacks those qualities and is potentially dangerous for the future prosperity of Wales. 

“Yes these are unprecedented times but the call for caps on borrowing to be removed could trap Wales and its people into decades of debt. 

“I have an uneasy feeling that the next Finance Minister after the 2021 Welsh Parliamentary Election will find a note saying ‘I'm afraid to tell you there's no money left…' as infamously written by Liam Byrne after Labour was ousted in the 2010 General Election.

“Look, Rishi Sunak, the Chancellor of the Exchequer, has acknowledged that the UK is facing a recession because of the pandemic, and of course the UK Government has borrowed money – lots of it.

“However, it has also acknowledged that it must be paid back. Yes, Wales needs investment, but it needs to be sustainable and financially sound, and not trap Welsh taxpayers in spiralling debt.”