Welsh government could gain powers over taxation

The prospect of the Welsh government and assembly gaining significant new powers over taxation has taken a step forward following a declaration by one UK minister.

The prospect of the Welsh government and assembly gaining significant new powers over taxation has taken a step forward following a declaration by one UK minister.

Speaking to the Welsh Lib Dem conference in Cardiff on Sunday, the chief secretary to the treasury, Danny Alexander, pledged to work “tirelessly” to see the recommendations of the Silk Commission implemented.

In November, the commission, chaired by the former clerk to the Welsh assembly, Paul Silk, recommended that decisions over business rates, stamp duty, landfill tax, capital gains tax, inheritance tax, vehicle tax and alcohol and exercise duties should be among those set and decided upon by the Welsh Assembly.

It went on to argue that, subject to a referendum, the Welsh government should be given responsibility for setting income tax as well, together with much stronger borrowing powers to invest in capital projects.

Entrenching devolution

Calling for a new model of devolution in Wales giving the assembly much greater responsibility for raising the funds it spends, Danny Alexander told his party faithful:

“We need a new model of devolution for Wales – a model in which additional responsibility for raising revenues strengthens responsibility too. A model in which significant income tax powers unlock commensurate borrowing powers for Wales too.

“We are still working through our response to the Silk commission with the Welsh government but I will not allow a response to Silk that doesn’t meet those aspirations.”

He continued:

“I said when I came to Wales in 2010 to speak to the (assembly) finance committee that there was a strong case for tax and borrowing powers, if there was a consensus in Wales. Now that we have such a consensus, I will work tirelessly to make this happen.”

Similar powers for Scotland?

In Scotland meanwhile, Labour’s leader at Holyrood has sought to head off growing anxiety among many Scottish Labour MPs that plans for the Scottish parliament to gain greater powers over taxation are tantamount to seeking to appease the SNP.

An interim report from the party’s devolution commission last week recommended that the Scottish parliament should gain powers over all income tax. Faced with a growing backlash to the idea in Westminster, however, Johann Lamont used her set piece speech to the Scottish Labour Conference on Saturday to both welcome the proposals whilst simultaneously arguing that they are not appeasing the nationalists.

She explained:

“Conference, this weekend we have published the interim report of our devolution commission. I believe it is a good piece of work.

“It is radical and challenging and I am grateful to everyone who contributed to it whether they represent Scottish Labour in our councils or in Europe, at Holyrood or Westminster, trade unions or party members.

“What it is – is the starting point of where we agree how devolution is to be developed. What it is not is an attempt to appease the SNP.”

She continued:

“I am well aware that you don’t appease lions by throwing more Christians at them. And I will not walk an inch down the road to independence.

“We will have plenty of time to debate it throughout the party and we will consult with all of Scotland on it. But let’s do that within this context. Our debate is not power for power’s sake, it is to ask where best should power lie to make the best of people’s lives.”

Meanwhile, following her controversial remarks last year in which she seemed to question the viability of some universal benefits, Lamont sought to spin the debate on its head, questioning how fair it is to promise free universal personal care for example when many care workers in Scotland are struggling to provide the care they want to.

Referring to the speech she made, Lamont explained:

“The SNP claimed I was attacking the principle of universal benefits, which I was not. What I was asking was the central question for anyone who believes in social justice, how do you deliver social justice in a time of scarcity not a time of plenty. And their response revealed to me two truths about the SNP.

“We start with the needs of the people. We develop policies which we believe will help meet those needs. And then we try to communicate it. The SNP are the other way round. They start with a slogan. The slogan is the parent of the policy and people’s needs come last.

“That is why in this country Alex Salmond says we have free personal care but in truth we have vulnerable and elderly people getting fifteen minute visits from carers who are instructed not to talk to them because a conversation would take up too much time.

“Free personal care says Salmond – but the carers told to say nothing to a pensioner in need. He has got the slogan but he is not funding the policy and people are suffering.”

She continued:

“And let me talk about one of the great achievements of a Labour government – the introduction of concessionary travel. The bus pass is a great thing. But it doesn’t really work if there isn’t a bus to get on. That is happening around the country. Services cut.

“Just this week, in one part of my own constituency we were told that people will not have a bus in their area after 6 o’clock at night.

“That’s why I want a debate about our nation’s priorities.”

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