Average Weekly Earnings

Oral Answers to Questions — Wales – in the House of Commons at 11:30 am on 3rd December 2014.

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Photo of Chris Evans Chris Evans Labour, Islwyn 11:30 am, 3rd December 2014

What assessment he has made of the reasons for changes in average weekly earnings in Wales in the last 12 months.

Photo of Mark Tami Mark Tami Opposition Whip (Commons), Opposition Pairing Whip (Commons)

What assessment he has made of the reasons for changes in average weekly earnings in Wales in the last 12 months; and if he will make a statement.

Photo of Alun Cairns Alun Cairns Government Whip, The Parliamentary Under-Secretary of State for Wales

Salary levels are not where we would like them to be, but over the past year the earnings gap between Wales and the average for the UK as a whole has narrowed. Since 2010, average earnings in Wales have increased by more than the UK average, and Wales has seen the second largest increase of all the English regions and devolved nations.

Photo of Chris Evans Chris Evans Labour, Islwyn

Caerphilly county borough council is clocking up a year as a living wage employer. Will the Minister follow its example and that of the Welsh Assembly by becoming a living wage employer at the Wales Office?

Photo of Alun Cairns Alun Cairns Government Whip, The Parliamentary Under-Secretary of State for Wales

The Wales Office already pays above the living wage. That is an important part of our policy, but it is a matter for employers. The best solution is to deliver a long-term economic plan so that employers can pay the living wage where possible. The greater competition that we see in the work force will help to drive wages even further.

Photo of Mark Tami Mark Tami Opposition Whip (Commons), Opposition Pairing Whip (Commons)

Average earnings in Flintshire fell again this year by 1.5%, in the Vale of Glamorgan by 1.3% and in Pembrokeshire by 5%. When will the Government own up to their terrible management of the economy and deliver for Welsh families?

Photo of Alun Cairns Alun Cairns Government Whip, The Parliamentary Under-Secretary of State for Wales

That accusation about the management of the economy is not reflected in the fastest growing economy among the developed nations of the world, because this Government’s long-term economic plan is working. The hon. Gentleman talks of average increases in salary. The trends from 2010 to the present show that average weekly earnings in Wales have increased by 5%, compared with 3.9% across the whole of the UK.

Photo of Robert Halfon Robert Halfon Conservative, Harlow

Does my hon. Friend agree that the best way to increase average earnings in Wales and in constituencies such as Harlow is to cut council tax for low earners and freeze fuel duty and council tax, just as this Government have done?

Photo of Alun Cairns Alun Cairns Government Whip, The Parliamentary Under-Secretary of State for Wales

My hon. Friend makes an important point. Whereas council tax in England has broadly been frozen, council tax in Wales has gone up by 13% in spite of additional funding being given to freeze it. If there was such a cost of living crisis as the Opposition claim, they would be pressing their colleagues in local authorities and in the Welsh Government to ensure that they do not increase council tax as they have.

Photo of Peter Hain Peter Hain Labour, Neath

But does not the Tories’ much trumpeted economic plan mean depressed earnings in Wales, generating lower taxes, and Government borrowing overshooting Labour’s planned target by more than £20 billion—the very deficit target luridly denounced by the Tories, who said it would bankrupt the country? Why does not the Minister apologise for this abysmal failure in the Government’s austerity strategy?

Photo of Alun Cairns Alun Cairns Government Whip, The Parliamentary Under-Secretary of State for Wales

As the right hon. Gentleman was part of the previous Government, he should apologise for leaving Wales the poorest part of the United Kingdom. He should further apologise for the fact that wages fell at the sharpest rate between 2008 and 2009. The Government’s long-term economic plan is working for Wales, and wages are rising quicker in Wales than across the rest of the United Kingdom.

Photo of Owen Smith Owen Smith Shadow Secretary of State for Wales

The Minister knows that low wages and poor jobs affect not just individuals and their families, but the public finances. Will he tell us what has happened to tax receipts and welfare spending in Wales since his Government came to power?

Photo of Alun Cairns Alun Cairns Government Whip, The Parliamentary Under-Secretary of State for Wales

We will receive a statement from my right hon. Friend the Chancellor a little later which will cover the UK financial position, but I hope the hon. Gentleman, who is the shadow Secretary of State for Wales, will welcome the progress that the Government are making in reducing unemployment and in growing wages in Wales.

Photo of Owen Smith Owen Smith Shadow Secretary of State for Wales

The Minister does not need to wait for the autumn statement, because the numbers are publicly available. Tax receipts in Wales have fallen by £2 billion since 2010, and benefit spending has gone up by £1.5 billion. That has piled an extra £6,000-worth of borrowing on every Welsh worker, and what have they got for it? They have got a twentyfold increase in food bank usage, the lowest wages in Wales and a cost of living crisis. The Tories have failed on the deficit, failed on the cost of living crisis, and they are failing in Wales once again.

Photo of Alun Cairns Alun Cairns Government Whip, The Parliamentary Under-Secretary of State for Wales

The shadow Secretary of State has clearly got his facts wrong. The long-term economic plan is working for Wales. If there has been a reduction in tax receipts from Wales, it is because of our increase in the personal allowance, under which next year the average worker will pay less than £800 as a result, taking 155,000 people in Wales out of income tax altogether by next April.