Income Tax Powers for Welsh Gov't

I suspect lots of Conservatives (and a fair few Labourites) will fiercely disagree with my opinions as outlined in this post. But here goes. I am in favour of devolving income tax to the Welsh Gov't - sharing the role with the UK Gov't 50-50. And I would go even further in that I would like to see this as a Conservative commitment in our 2015 manifesto - negating the need for a referendum if we form the next Gov't. I suppose readers (most of whom will disagree with me) are not going to become too exercised by this opinion though. Like me, they do not see much chance of it actually happening!

The reason I begin my post with such a provocative and controversial statement is that Danny Alexander, Chief Secretary to the Treasury has been in Wales today, talking about it. In his view there is a consensus in favour of transferring responsibility for 50% of income tax raising to Wales (Oh Yeah) - and he will not allow a Treasury response to the Silk Commission Part One Report which does not include these powers. Now this is very big talk indeed. I should remind those who do not share my interest (that's almost everyone else) in Welsh constitutional issues what 'Silk' is. The UK Gov't established a commission, chaired by Paul Silk to recommend how devolution funding arrangements should be changed to make the Welsh Gov't more fiscally accountable. Silk 'Part One' was delivered last year, and we are expecting to learn of the Treasury/Wales Office response 'soon'.  The Report made several recommendations, but the only one that would make a real difference would be to devolve income tax raising powers.

While I was not in favour of creating a National Assembly for Wales in the 1997 referendum, I accepted the Yes vote immediately, and ever since have believed it should have tax raising/varying powers. Made no sense otherwise. We had those powers when I chaired Berriew Community Council in the 1970s. At present all the Welsh Gov't does in allocate spending. Its not actually a Gov't at all in any real sense. Its a spending agency. Everything popular they say "We are great" and everything unpopular they say "the UK Gov't won't give us the money". No accountability. Needs to change. Welsh politics could really grow up then.

Where I am almost alone is believing there's no need for a referendum. I don't like referendums in principle. The proper way to govern is to inform voters of plans in a manifesto, and if elected act on them. If there's a coalition, both parties involved would have to have committed to devolving income tax raising powers. Problem is that if there is a referendum, voters will automatically assume that a Welsh Gov't will put up income tax, and they will vote no. Well, a future Welsh Gov't might vote to cut income tax. Huge amount of time and money wasted - and no financial accountability either. Anyway, it seems that Danny Alexander has decided it will go ahead! He will not allow anything less. Hmmm. Don't think he's been talking to the same people as me. Don't even think he'll have the Welsh Gov't onside, though could be wrong about this. Looking forward to seeing this response to 'Silk'. Its going to lead to some interesting debate at Westminster.