WALES will receive an additional £65 million as a result of the Budget, Welsh Secretary Cheryl Gillan has said.

The Conservative MP insisted George Osborne's second Budget represented a “good deal” for the principality - highlighting changes to personal tax allowances as one example. She said the new system would take another 10,000 of some of the poorest people in Wales out of tax.

"In what is a fiscally neutral budget, the Welsh Assembly Government will receive an additional £65 million to spend as a result of today's announcements,’’ she said.

"This is good news for Wales. In the devolved areas it is up to Assembly ministers in Cardiff to deliver the same opportunities we are providing for companies in England.’’ Her predecessor, Peter Hain MP, said the UK Government was sending the economy backwards.

He said: "The recovery should be picking up speed - instead the recovery is losing momentum.

"As the Office for Budget Responsibility confirms, growth is only two thirds of what it would have been with Labour.

"George Osborne may say this is a neutral budget, but the truth is like every Tory budget is not neutral for Wales, where we have been asked yet again to pay for tax breaks for banks.

"This was Cheryl Gillan's big test and she flunked it. Wales is still being hit disproportionately hard by the Tory-led Government. We recognise the need for cuts. We haven't opposed every cut the Government has come up with. Indeed, we are supporting some of the cuts they are making.

"There would have been cuts under Labour. What we are saying is that, by going too far and too fast, the Government is doing something no other government around the world is doing.’’ Plaid Cymru's Treasury spokesman Jonathan Edwards MP also expressed concerns that the depth and pace of the cuts could lead to a "decade of economic stagnation’’ in Wales.

He said: "We welcome some initiatives such as the introduction of a fuel price stabiliser, something we have been campaigning loudly for over a number of years.

"But crucially, the UK Government has failed once again to tackle the issue of Barnett reform or the £385 million End Year Flexibility that they mugged from the Welsh Government a few months ago.

"Ultimately, this was a Budget of small beer compared to the cuts announced last year and the destructive effects that those will have on our communities.’’ Meanwhile, business leaders in Wales voiced mixed feelings about the Budget.

Matt Southall, managing director of recruitment consultants Acorn, said there was still more which needed to be done.

"Recruiters will be pleased steps are being taken to help businesses grow, and fast-tracking a reduction in Corporation Tax will be welcomed generally by employers across the country,’’ he added.

"However, I am disappointed to see the planned increase in employers' National Insurance contributions will go ahead.’’ And the Institute of Directors (IoD) Wales said a reduction in fuel duty would help businesses - small and large - that are experiencing a sharp increase in their cost base.

IoD director Robert Lloyd Griffiths said: "This was a Budget aimed at changing perceptions and boosting business confidence about long-term economic prospects in the UK. The Chancellor didn't have much money to play with but he played his hand well.’’