Use consequential cash to restore business rate relief, Plaid urge Labour Governmen

Some of the consequential funding coming to Wales from the UK Government budget should be used to restore business rate relief, Plaid Cymru has said.

Plaid Cymru Finance spokesperson, Heledd Fychan called for the Labour Government in Wales to restore business rate relief to 75%, the level at which they stood before the Welsh Government cut them to 40% in April 2024.

The restoration of the business rate relief is expected to cost an extra £50 million according to the Welsh Government. Ms Fychan said the cost of this policy should come from the £1.7 billion in consequential funding received by the Welsh Government as a result of the UK Government Budget.

Ms Fychan said small businesses in Wales were facing a double whammy considering the cuts made to business rate relief made in Wales earlier this year, alongside the employer National Insurance contribution increase announced by the Chancellor last week.

The Chancellor announced in her Budget last week (September 30, 2024) that National Insurance contributions made by employers increased from 13.8% to 15% and the threshold at which employers start paying the tax on each employee’s salary decreased from £9,100 per year to £5,000.

Plaid Cymru said the policy will have an adverse effect on SMEs in Wales which account for 99% of businesses.

The OBR has confirmed that real wage growth and living standards will stall as a result of these measures. 

Plaid Cymru finance spokesperson, Heledd Fychan MS said:

“Wales’ economy is struggling, with economic inactivity here the second highest of the UK nations and regions, and unemployment the highest in the UK. A situation that will only be worsened by Labour’s increase in National Insurance contributions made by employers. These raises, coupled with the cuts to business rate relief earlier this year, result in a double whammy to small businesses and high streets in Wales, and therefore has a disproportionate impact on Welsh businesses.

“Labour like to call themselves the party of business, and they claim that the latest Budget has given them more money to spend. It’s time they proved this, by supporting our small businesses in Wales by restoring the business rate relief to 75%.

“Wales’ economy is dependent on the small businesses who employ our workers and line our high streets. They are currently being let down by Labour, both in Wales and in Westminster. Plaid Cymru will always back Welsh businesses and will grant them the support they need to thrive. 

“Strengthening our small businesses, growing our economy, and putting more money in people’s pockets will be a top priority for a Plaid Cymru government in contrast to the Labour Government who have overseen the decline of living standards, the decline in industry, and decline in our economy. A Plaid Cymru Government offers the people of Wales, and the Welsh economy, hope and a fresh start after 25 years of economic misfire by Labour”.