The hardest hit

ElunedMorgan4x3.pngEluned Morgan on the cumulative impact of Coalition economic policies on the people of Wales

When the banking crisis hit in 2008, we knew that someone somewhere would pay a price. But even the most callous cynic would never have predicted that those people hit hardest would be the poorest in Wales. According to The Rowntree Foundation, close to 700,000 people live in poverty in Wales today – enough to fill the Millennium Stadium ten times over. 

Research by Sheffield Hallam University found that Wales will lose over £1bn per year when all benefit cuts are taken into account. This represents an average cut of £550 per year for every working age adult – 20% above the estimated average loss for the whole of Britain. And these cuts will not be equally distributed –focussed instead on places least able to cope with these cuts. Adults in Merthyr Tydfil for example, will lose an average of £722 per year. 

Of course times are tough and the deficit must be reduced, but it is particularly galling to hear these statistics when those who caused the crisis are earning more than ever. The European Banking Authority last week claimed that 2,700 bankers in the UK now earn £1.67m – an increase in pay of 43%. 

Approximately one third of children in Wales are living in poverty according to a new report from Save the Children. The three year freeze of Child Benefit will affect 370,000 Welsh families – a total loss of £47 million in 2014. Meanwhile, the costs of food, the school bus and school uniforms have all gone up. 

Then there’s the bedroom tax – a dreadful policy that is ripping people away from their communities or forcing them into the hands of loan sharks. Again Wales is hardest hit, with 46% of housing benefit recipients who live in social housing affected – that’s 40,000 households. 

The people receiving welfare support want to work and do not recognise the miracle uplift in the economy which George Osborne would have us believe is occurring. Most couples with children are now required to work at least 24 hours a week – up from 16 hours – to qualify for working tax credit. Having demonstrated they are able and willing to work, they are now going to lose up to £3,800 a year if they are unable to find additional hours. 65,000 of people in Wales are under-employed. 

It’s not just the people living on welfare who are suffering. Wales has the highest proportion of workers of anywhere in the UK, with around 300,000 earning below the living wage. And neither is it just the poor who are suffering. The middle classes are too. Real wages have fallen in 41 out of 42 weeks and Welsh workers are now around £1,600 worse off, an 8% fall in annual pay since the Coalition took office. And energy bills in Wales have risen by almost £300 since 2010. South Wales is the region in Britain with the highest combined gas and electricity bills, North Wales comes in third.

So where are the answers from the government? Ministers boast about £2bn worth of new infrastructure that will benefit Wales. The reality is that virtually none of this will appear during this Parliament. 

Baroness Eluned Morgan is a Shadow Wales Minister in the House of Lords

Published 3rd December 2013

Do you like this page?


Please check your e-mail for a link to activate your account.

The Labour Party will place cookies on your computer to help us make this website better.

Please read this to review the updates about which cookies we use and what information we collect on our site.

To find out more about these cookies, see our privacy notice. Use of this site confirms your acceptance of these cookies.