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26 June 2013

CHC Group responds to Chancellor's Spending Review

The UK Government announced its spending review for 2015-16 today, with a large number of departmental cuts in England. The result will be a reduced Welsh Government resource budget of £13.6bn for the same financial year, down almost £400m on this year’s resource budget.

As well as cuts to revenue, the Chancellor announced three new welfare reforms to begin in April 2015. This includes an overall benefit spending cap, which will include housing benefit, and means that any government exceeding the yearly cap will have to justify the overspend to the Office of Budget Responsibility.

The Chancellor did announce £50bn worth of capital projects for 2015-16, with further details expected on these projects from the Chief Secretary to the Treasury tomorrow. The overall capital budget for Welsh Government for 2014-15 will be £1.4bn and £1.5bn for 2015-16.

Nick Bennett, Group Chief Executive of CHC said: “We are calling on the Welsh Government to use their extra capital allocation over the next two years to stimulate the economy through major investment in affordable housing. The social housing sector has not stood still through the economic downturn, has a proven track record in delivering new homes, local jobs and training opportunities and is the only sector in Wales with the ability to lever in additional private investment. Further investment would also allow the sector to build more one and two bed properties and go some way towards mitigating the long term impacts of welfare reform.

We are concerned about further cuts to Welsh Government’s revenue budget. While health spending is protected in England, Welsh Government must look to the preventative agenda to reduce the impact on the NHS. We believe that protecting health but not investing in housing and the preventative agenda is counter-productive. Protecting the budget for the Supporting People Programme Grant and Care & Repair services in Wales would reduce the burden on an already overstretched health service.

We are also deeply worried about the impact of a further cap on welfare, which will included housing benefit, in the midst of ongoing reforms to welfare that are causing problems to many of the most vulnerable in society.”

To read the full speech – visit https://www.gov.uk/government/speeches/spending-round-2013-speech