Contact info:

UK Autumn Statement: The View from Wales

Here is a quick update from the Deryn team highlighting Wales-related announcements from this week's Autumn Statement. Please get in touch for a personalised briefing on how these changes will affect you and your organisation. 

Headlines for Wales

  • Promising 'long-term decisions for a brighter future' in launching his Autumn Statement, there was no denying a sense of urgency from the Chancellor with a General Election expected as early as Spring 2024.
  • An extra £305 million in Barnett consequentials for the Welsh Government over two years, on top of the block grant of £20 billion for the Welsh Government to spend on devolved responsibilities.
  • Two new Investment Zones in Cardiff & Newport and Wrexham & Flintshire, to be delivered by the respective Corporate Joint Committees (formerly City Deals or Regional Growth Partnerships)
  • On infrastructure, re-announced funding for the electrification of the North Wales Line, bus and active travel investment in Chepstow in David TC Davies' Monmouthshire constituency and plans for additional floating wind in the Celtic Sea through the 2030s.
  • Follows the announcement of £111 million for Levelling Up projects in Powys, Vale of Glamorgan, Denbighshire, Neath Port Talbot, Carmarthenshire and Pembrokeshire.

A summary of wider UK announcements outlined by the Office of the Secretary for Wales can be found here.

What does the Autumn Statement tell us about when the general election will take place?

Most of the UK's employees will be paying less in National Insurance from 6th January 2024 – an unusual step to bring fiscal changes forward from the start of the tax year on 6th April.  With an earlier than usual Spring conference season and candidate selections advancing, this is another indication that the Prime Minister's window for a sudden Spring general election is very much open.  By the first Thursday in May, the average worker will have had four pay cheques with a reduced NI contribution and Conservatives will be hoping they're feeling the benefit.

The Prime Minister has repeatedly said he wants to cut taxes but needs to demonstrate it's part of his long-term plan and fits alongside the delivery of his five key pledges. This Autumn Statement lays the groundwork for delivering on three of those pledges. The first, halving inflation, was achieved last month but by the general election Rishi Sunak needs to evidence that he's growing the economy and reducing the country's debt. In his statement the Chancellor said that in 2024 UK debt will fall 'as a share of the economy'.

Will workers in Wales feel better off?

David TC Davies has commended the statement for putting 'more money in the pockets of over a million working people across Wales', citing the NI cuts and the increase in the National Living Wage. But with inflation still well above the Chancellor's 2% target and the overall tax burden at its highest level in 70 years, partly due to the freezing of personal allowances, opposition parties are questioning whether voters really will be any better off.

What are the key announcements for the Welsh economy?

The Statement saw a suite of supply-side measures impacting Wales:

  • Floating Offshore Wind – The UK Government is working in conjunction with the Crown Estate to bring forward additional floating wind in the Celtic Sea through the 2030s. There will be potential for £20 billion of direct investment from deployment in the Celtic Sea area.
  • British Manufacturers - £4.5 billion of funding will be made for manufacturers in the "high-growth industries of the future". This includes £960 million for the Green Industries Growth Accelerator to support the UK's transition to clean energy.
  • Investment Zones – Two new zones will be established in Cardiff & Newport, delivered by the Cardiff Capital Region Corporate Joint Committee, and Wrexham & Flintshire, delivered by the North Wales Corporate Joint Committee.
  • Freeports – The Celtic Freeport in Milford Haven and Port Talbot, and the Anglesey Freeport on Ynys Môn will benefit from the extension of tax reliefs from five to ten years.
  • Investment Opportunity Fund - a UK-wide £150 million fund, which can be accessed by Welsh Investment Zones and Freeports, to secure business investment opportunities, available over five years.
  • Grid Access – plans to cut grid access times for larger projects by half, halve the time to build major grid upgrades and offer up to £10,000 off electricity bills over 10 years for those living closest to new transmission infrastructure. 

What about Levelling Up?

The Statement tells us that Rishi Sunak's government has not turned its back on Levelling Up:

  • North Wales Main Line - £1 billion of funding will be made available for electrification.
  • Monmouthshire - £5.2 million for public transport and active travel infrastructure in Chepstow
  • Space Technology Centre – £800,000 for the Space Technology Centre in North Wales.
  • Hay Festival - £500,000 will be made available for the Welsh festival in the Brecon & Radnorshire constituency.

Political Analysis

The Autumn Statement can be seen as an indication by the Conservatives that they are seeking to shore up their position and evidence how the UK Government is delivering for Wales.  A number of key announcements will be beneficial to voters in key battleground seats, such as the seats of Brecon, Radnor and Cwm Tawe, Mid and South Pembrokeshire, Monmouthshire and Red Wall seats in North Wales.

The two investment zones have been welcomed by local politicians in the Cardiff Capital Region and in North East Wales, focussed around compound semi-conductors and advanced manufacturing respectively. These are intended to demonstrate long-term decisions to drive economic growth, but alongside levelling up funding, which seems to disproportionately benefit Conservative-held constituencies, opposition parties will see this as an Autumn Statement of pre-election sweeteners.

The UK Government's announcement to bring forward plans for additional offshore wind farms will impact the newly created Mid and South Pembrokeshire seat, a key Conservative/Labour battleground.

For a bird's eye view.
Am olwg oddi uchod.

Please upgrade your browser

You are seeing this because you are using a browser that is not supported. Our website is built using modern technology and to modern standards. We recommend upgrading your browser with one of the following to properly view our website:

Windows Mac

Please note that this is not an exhaustive list of browsers. We also do not intend to recommend a particular manufacturer's browser over another's; only to suggest upgrading to a browser version that is compliant with current standards to give you the best and most secure browsing experience.