Details of new financial powers for Wales revealed


Welsh Secretary David Jones is due to update MPs later today on plans to give the Welsh government more financial powers.

If you can't wait until then (it could be 4.30pm or later), the Treasury and the Wales Office have published details here, risking the wrath of Speaker John Bercow, who is usually keen that MPs get to hear about major announcements first.

The UK government says it has accepted, in whole or in part, 30 of the 31 recommendations from the Silk commission - ignoring only the idea of devolving air passenger duty.

The key announcement appears to be that although the Welsh government could have some responsibility for gathering income tax, the Welsh government wouldn't have the power to vary individual tax bands. Instead, a "lockstep" approach would be introduced, ensuring every band had to be moved in tandem, so a 1p cut (or increase) in the basic rate would also mean a 1p cut (or increase) in higher rates. It would limit a future Welsh government's room for manoeuvre should it want to increase taxes on the rich while sparing workers on lower and middle incomes.

The Silk commission had recommended that the Welsh government should have the flexibility to move each tax band independently of each other.

David Jones, Treasury Chief Secretary Danny Alexander and Welsh Finance Minister Jane Hutt have also been taking part in a news conference in Cardiff.

Mr Jones used the gathering to call for an early referendum on devolving income tax powers to Wales and said he's campaign for a "yes" vote.

In a separate statement, he said: "Through this package of powers we are announcing today, we are giving the Welsh government the tools to make the right investments in Wales.

"Infrastructure investment is vitally important to delivering long-term, balanced economic growth across the UK. This package of powers will enable the Welsh government to invest immediately in the areas of infrastructure it leads on, such as the key routes on the trans-European road network - the M4 and the North Wales Expressway.

"The government believes in devolution and we're determined to deliver. Accepting the Silk Commission's key recommendations on financial devolution strikes the right balance and marks an important step in Wales' devolution journey.

"These new powers will make for more accountable government for the Welsh people. It is now up to the Welsh government to seize this once in a generation opportunity - to drive forward Wales' economic development, and to use this opportunity to secure the growth and prosperity that Wales so desperately needs."

My colleagues in Cardiff will be adding more details on the BBC website during the course of the day.

David Cornock Article written by David Cornock David Cornock Parliamentary correspondent, Wales

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  • rate this

    Comment number 9.

    7 digbic78 Unfortunately, because of the WA, most schoolchildren in Wales will not understand the PISA results. Mab and his mob should reflect upon that

  • rate this

    Comment number 8.

    ... if Scotland votes "Yes" then devolving taxation makes even more sense, as Westminster contracts government, the Assembly would have no option but to cut its activity, raise taxes or fall into line with Westminster, either way politics in Wales will take a beating.

    It just needs a Conservative win at the next general election.

  • rate this

    Comment number 7.

    re 3 mabion

    we need more than every penny that comes back to wales mab...especially to keep our benefit lovers on the dole and to prop up the dying welsh language and to run our schools into the ground...PISA should make some good reading when it comes out.i don't think i will ever see a prosperous or functioning wales in my life time

  • rate this

    Comment number 6.

    ... after 15 years (1999 referendum), it is now convenient to pass the tax baton to Wales, the unanswered question "why now?"

    Is it the democracy of political responsibility, " ... if you want to spend it then raise it", or could it be more fundamental, the Conservative ideology Cameron and Co. feel cannot be won in Wales without devolving taxation ................ "small government".

  • rate this

    Comment number 5.

    #3 You are not going to have many penny's in the kitty though?
    Even if we have "every" penny kept in Wales, where will the balance come from to balance the books?
    Not enough people/business in Wales to generate such income.
    We would be paying out even more Tax to make this happen.
    At least this proposal is a start, lets see how they get on with this first.

  • rate this

    Comment number 4.

    Welsh pennies staying in Wales is not your problem Mabion, it's English pennies NOT coming to Wales.

  • rate this

    Comment number 3.

    Again little Wales is under the thumb of Westminster with boundaries of what we can or can't do even if we vote overwhelmingly for a Yes vote to a income tax referendum. Some prefer us to be taxed to our knees from Westminster so it benefits the s/e as they only know one perspective to grovel on their knees to London. I want full control over all taxes so every Welsh penny come back to Wales.

  • rate this

    Comment number 2.

    Cheeky approach to income tax - up for all or down for all. Why not?

    All in all, a very good day for our country.

    Indeed Mr Jones, Wales does need economic development, growth and prosperity, and it's highly informative that the London based UK Government now AGREE with us 'Nationalists' that devolved Government in Cardiff is the means of achieving it!

    But tell me, what took you SO long?

  • rate this

    Comment number 1.

    ... fascinating, particularly the new financial powers that includes the ability to create new taxes [with the UK government’s agreement], back to the 1960's then when we were taxed to the armpits.

    For sure, Westminster would welcome Carwyn taxing Wales to its knees...


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