Ceredigion Preseli MP and Plaid Cymru’s Treasury spokesperson, Ben Lake, has written to Chancellor of the Exchequer Rachel Reeves ahead of the 2025 Spring Statement, urging the UK Government to reconsider planned spending cuts and ensure Wales receives fair funding.

The Spring Statement, set to be delivered in the House of Commons on Wednesday, 26 March, will provide an update on the UK economy, public finances, and the Government’s economic objectives.

The Office for Budget Responsibility (OBR) will publish its latest economic and fiscal forecast alongside the statement, with expectations that the UK’s economic outlook will be downgraded.

Mr Lake has raised concerns that the UK Government’s response to this downturn – cutting public spending – will disproportionately impact the most vulnerable communities in Wales, exacerbating poverty and inequality.

He has also highlighted the potential financial implications for Wales of England-only decisions, such as the abolition of NHS England, which could reduce the funds allocated to Wales through the Barnett Formula.

In his letter, Mr Lake proposes several alternatives to the Chancellor’s current fiscal approach.

These include: Charging National Insurance on limited liability partnerships, such as large corporate law firms; closing tax loopholes that allow overseas-based online vendors to avoid VAT; and ending subsidies for oil and gas companies.

The Plaid Cymru MP also calls on the Chancellor to address the longstanding funding disparities faced by Wales.

He notes that Northern Ireland’s Barnett Formula allocation is nine per cent higher than that of Wales, leaving Welsh public services underfunded.

In his letter, Mr Lake writes: “The Office for Budget Responsibility is widely expected to downgrade the performance of the UK economy, and I am concerned that the Government’s response to cut public spending will harm the most vulnerable in Wales by increasing poverty and exacerbating inequality.

“Spending decisions which apply to England only, such as the decision to abolish NHS England, will nevertheless have implications for Wales by potentially reducing the amount received through the Barnett Formula.

“I note that several practical alternatives have been proposed to raise additional revenue for the UK Government, and I would be grateful to understand whether they have been considered in advance of the Spring Statement.

“It has been estimated that charging National Insurance on limited liability partnerships such as large corporate law firms, for example, or closing loopholes allowing overseas-based online vendors to avoid paying VAT, in addition to cutting the subsides for oil and gas companies could raise billions to help meet the Government’s current fiscal rules without the need for further austerity.

“The Spring Statement is also an opportunity to give Wales financial parity with the devolved nations so that the Welsh Government has the economic levers to grow the economy and improve livelihoods.

“For instance, Northern Ireland’s Barnett Formula needs-based funding is nine per cent higher than Wales’s which means Welsh public services such as health and housing are missing out on additional funding.

“Wales also lacks the ability to invest in infrastructure such as schools, hospitals and transport projects given that the Welsh Government has an annual capital borrowing limit of £150 million compared to the Scottish Government’s £450 million.

“I would be grateful to know whether the UK Government will look to address these inequalities as part of its ongoing negotiations with the Welsh Government on the Welsh Government Fiscal Framework.

“I urge you to use this Spring Statement to fulfil the UK Government’s promise of not returning to a policy of austerity, and to introduce fair funding and investment powers for Wales.”