: Diolch, Weinidog.
More than three in 10 households with a net income of less than
£40,000 have seen their income drop since May 2021, and for
households with a net income of more than £40,000, more than one
in five have seen their incomes increase. Wage growth stagnated
in October, fell in November, and is unlikely to start growing
again until the final quarter of this year, disproportionately
affecting those on low income. By the end of 2024, real wages are
set to be £740 a year lower than they would have been, had
pre-pandemic pay growth continued. This is clearly a crisis that
is worsening an already deep economic disparity. Figures revealed
just today show that we are experiencing record levels of
inflation, which are outstripping wages while pushing living
costs up higher. The scale of the problem means it's more
important than ever that Wales's economic strategy is primarily
focused on tackling economic inequality. So, what discussions has
the Minister had with the social justice Minister and other
colleagues in Government on this, and what further economic
powers does he think should be devolved to Wales, so that we can
properly get to grips with this crisis and alleviate its negative
effects on our society? Diolch.
(Minister for
Economy): Thank you for the points and the series of
questions. I think it's interesting, the point about wage growth,
because even at the start of this week, there was a suggestion
that we would see significant wage growth figures coming through,
and yet the figures actually showed that wages had not kept pace
with inflation. And I think the previous comments of the Governor
of the Bank of England about needing to suppress wages to try to
keep control of inflation—there were commentators and economists
on both the left and the right, as it were, who both thought
those were rather odd remarks and not borne out by what is
actually driving inflation at present: it isn't wages.
The Resolution Foundation said we can expect a cost-of-living
catastrophe in April without further action. Now, that's part of
the reason why unveiled a £330 million
package for Wales yesterday. It goes beyond the UK Government
package announced for England, but, of course, that has been
delivered here in Wales without any extra funding coming to
Wales.
I think, on your point about powers, actually it's the resource
that we need to be able to address the cost-of-living crisis, and
it's also the willingness of the UK Government to do something
about it. I just think that, for businesses as well as for
households, thinking that the current fix that's been announced
to date is going to get us through till the end of April I think
is fanciful. I think many families and businesses will find the
increase in costs that are coming very hard to deal with. And for
many of my constituents and many people across Wales, that means
even more people choosing between heating and eating. It means
even more parents going hungry to try to make sure their children
are fed. So, there are changes we want to see: we want to see the
cut to universal credit restored; we want to see further action.
And, yes, we do support the cause for a windfall levy on energy
companies who are making eye-watering sums of money. When you
have Shell and
BP talking about their businesses as cash machines, and they
can't spend the money quick enough, I don't think that this is
something where a UK Government could simply say that it will
refuse to act and leave people to their fate. I certainly hope
that the Chancellor is listening, because I've certainly had
those conversations with the Minister for Social Justice, the
Minister for Climate Change, and, indeed, the finance Minister
and others, about what we could and should do here in Wales with
the resources available to us.
