Liz Truss says she wants 'higher wages' for people of Wales as she defends benefits freeze

Liz Truss sat down with ITV Wales Political Editor Adrian Masters at the Conservative Party Conference

The Prime Minister says she wants the people of Wales “to have higher wages” as she defended her plans to freeze benefits payments as well as cutting taxes. 

In an interview with ITV Wales, Liz Truss also said that it is “a matter for Mark Drakeford” if he increases income tax levels in Wales. 

But she told Political Editor Adrian Masters that any such move would hamper efforts to boost economic growth. 

She also dealt with a long-running controversy within the Welsh Conservative party over the status of the Welsh leader, backing Andrew RT Davies as more than just the leader of Tory Senedd members. 

At her party’s conference in Birmingham, Liz Truss has been defending her controversial economic growth plan which included cutting the basic rate of income tax by 1p and abolishing the highest, 45p rate for top earners. 

She’s been forced into a u-turn on that 45p rate, although she stands by the principle. 

There was turmoil in the financial markets after those moves were announced by the Chancellor along with huge increases in borrowing to pay for them. 

At one point the pound fell to its lowest-ever level against the dollar and, at another, the Bank of England had to step in to prop up pension funds. 

There’s been criticism too at news of a freeze in welfare payments as part of efforts to show a long term plan to balance the books. 

Adrian Masters asked the Prime Minister how it was fair to squeeze the payments of the roughly 400,000 benefit-claimants in Wales, many of whom are in work, while cutting taxes for the very rich, as the plans originally included. 

According to the most recent HMRC figures, just 4,300 people in Wales earn enough to have benefitted from the proposed abolition of the highest rate of tax - representing 0.3% of the Welsh population.

Chancellor Kwasi Kwarteng and Prime Minister Liz Truss sit together at the Conservative Party Conference in Birmingham. Credit: PA

Ms Truss said that the mini-budget included aid for vulnerable people as well as tax cuts which she said would encourage investment into Wales. 

“What I want for the people of Wales is for more people to be able to earn more money and have higher wages and the way we are going to do that is [by] attracting investment and growth into Wales", she said.

“And if we have very high tax rates and rising corporation tax, that is going to be harder to attract the investment and growth into Wales. 

“So yes, I want to help the most vulnerable people - that's why we put in place the energy price guarantee, that is why we're supporting the most vulnerable with £1200 of extra support - but we also need to grow the Welsh economy by attracting investment, and we're not going to attract investment and growth with very high taxes.”

The Welsh Government has some power over income tax gathered in Wales including the abilities to vary levels within the bands set by the U.K. Government. 

Plaid Cymru has urged the First Minister to increase the Welsh part of the basic rate which is being cut to 19p  in order to restore it to 20p. 

Mark Drakeford hasn’t ruled out doing that but says the Welsh Government will look at income tax as part of its budget process. 

Asked if he should rule it out, Liz Truss told Adrian Masters: “Well I would like Mark Drakeford to work with the UK Government on driving economic growth.

“It's a matter for Mark Drakeford what he does. He is the elected leader. But I am very clear that we want to see lower taxes and more economic growth in Wales.“

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Ms Truss also said that she wants Mark Drakeford to reverse his government’s decision not to build an M4 relief road at Newport. 

Her predecessor, Boris Johnson, had insisted that his government would revive the project even though decision-making power lies with the Welsh Government. 

Liz Truss wouldn’t go that far. She told Adrian Masters: “We're committed to that but we need Mark Drakeford to work with us. 

“I want to encourage Mark Drakeford to rule it in.”

In her interview, the Prime Minister also gave her view on a long-running internal Welsh Conservative party debate. 

The party’s Welsh leader is directly elected by members but is officially only the leader of the Senedd group of MSs. 

When he was Prime Minister, David Cameron recognised the post as having the wider responsibility of leader in Wales. 

Under Theresa May and Boris Johnson that changed so that Andrew RT Davies reverted to being simply leader of the Senedd group. 

Now it’s changed again.  Liz Truss said clearly that “he is the leader of the Welsh Conservatives.”

Asked again if that’s an official, wider role she said simply “yes.”

You can watch Adrian Master's full sit-down interview with Liz Truss on Wales at Six, Monday, October 3 at 18:00 on ITV Wales.