A new chapter in devolution begins
DEVOLUTION did not arrive in Wales with an almighty bang. The referendum to set up the Assembly was passed by just 6,721 votes. The institution lacked many of the powers of its counterparts in Edinburgh and Belfast.
Politics aficionados followed each chapter of its growth in clout with keen interest, but most people do not study the details of devolution legislation. Instead, they become aware of its powers when decisions made by AMs affect their lives.
A decade ago, free prescriptions were introduced in Wales. Suddenly, a cost was removed for thousands of people on this side of Offa’s Dyke.
The carrier bag charge was introduced in 2011. It was yet another reminder that the days of laws automatically applying on an “England and Wales” basis were gone.
Ministers are gaining powers to make much bolder changes. From April, Wales will have a land transaction tax while England will continue with its present system of stamp duty.
Chancellor Philip Hammond’s big-ticket announcement in last month’s Budget was that first-time buyers would not have to pay stamp duty on homes costing up to £300,000.
But from April the system in Wales will be that anyone buying a home for up to £180,000 will pay no tax.
The Welsh Government claims that “80% of first-time buyers in Wales will pay no tax” and that this is “the same proportion which will benefit from the Chancellor’s firsttime buyer stamp duty land tax relief in England”.
But this hasn’t stopped the Conservatives reacting with alarm. There are plenty of houses in Wales that cost more than £180,000, especially in urban areas where young professional first-time buyers may hope to start a family, and the Tories have raised fears of a “brain drain”, with talented people choosing to settle in England.
A new chapter in Welsh politics is opening in which there will be heated debates, not just about how money is spent but how it is raised.
Voters will go into polling stations thinking not just about how parties may invest in schools and hospitals but how they will levy taxes.
The scene is set for a fascinating debate about how best to help home-buyers, but if a Welsh Government chooses to start using income tax-varying powers then unprecedented attention will focus on the role of AMs in influencing the economy for better or worse.
A debate is already under way as to whether 60 AMs is enough to provide talented ministers to serve in government and vigilant backbenchers to hold them to account.
The argument will be made that the size of the talent pool needs to be increased, and that the cost of paying extra salaries will be more than made up by the enhancement to democracy and government.
When AMs crank levers of power that affect your bank balance, we may see the first Assembly election with a turnout of more than 50% of the electorate. The Western Mail newspaper is published by Media Wales a subsidiary company of Trinity Mirror PLC, which is a member of IPSO, the Independent Press Standards Organisation. The entire contents of The Western Mail are the copyright of Media Wales Ltd. It is an offence to copy any of its contents in any way without the company’s permission. If you require a licence to copy parts of it in any way or form, write to the Head of Finance at Six Park Street. The recycled paper content of UK newspapers in 2016 was 62.8%