Wales deserves better: Income tax, infrastructure, and institutional neglect

There is a lack of serious discussion dedicated to Wales, the Welsh Government and Welsh issues
The Government of Wales has some devolved powers

There is a lack of serious discussion dedicated to Wales, the Welsh Government and Welsh issues. Occasionally, like when the Welsh Government introduced the carrier bag charge or the 20mph speed limit, an issue will be taken up and on occasions overdramatised.

Serious issues like constitutional threats and systemic inequality are marginalised and all too often swept under the carpet. Most people don’t hear enough about them. But we owe it to our nation to delve into the detail. Here are some issues, which are worth talking about.

Inside the Welsh Income Tax

If you were to look briefly at the country’s devolved powers, you would assume Wales has power over income tax. If you live in Wales, you pay Welsh Income tax, a rate set by the Welsh Government. You might assume this means the Senedd have the power to do as Scotland has done and raise income tax for the very rich above what they would pay if they lived in England. You would be mistaken.

The mechanism of the current settlement is this: The UK Government reduced the income tax for Welsh taxpayers to 90 per cent of the level of English taxpayers and then gave the Senedd the power to “raise” income tax back to the original 100 per cent, but not a penny more. In effect, Wales can only lower income tax, not raise it.

But if you say to someone, “Wales should have the power to raise income tax”, you might well receive the smug reply that “Wales already has that power”. And technically, that’s true.

Assisted dying: Does the UK government respect devolution?

When the private members bill on Assisted Dying was proposed, the Senedd debated and voted against the principles of assisted dying.

This was relevant because health is a devolved matter, meaning the Welsh Government is in charge of health in Wales.

Nevertheless, because the private members’ bill is firstly a justice bill (it decriminalises assisted dying) and only secondly a health bill it would be considered a Bill for ‘England and Wales’.

The Bill instructs on how healthcare is delivered and gives what Professor of Law Emyr Lewis calls “an almost limitless power” to the Secretary of State and the UK Government.

It does not require any consultation with Welsh Ministers, nor does it require their consent, even though the wording of the Bill makes explicit mention of “the health service in Wales”.

In a normal course of events, the Governments would follow the Sewel convention, that says ‘it is recognised that the Parliament of the United Kingdom will not normally legislate with regard to devolved matters without the consent of the Senedd’. This is not legally binding, but a rule which the UK Parliament should constitutionally follow.

The MP who put this Bill forward was not required to consider its impact on devolution settlements, nor its constitutional grounding.

The Welsh Parliament, including several high-profile ministers including the Health Minister, Jeremy Miles and the First Minister, Eluned Morgan, voted against the principles of assisted dying. Wales has full devolved responsibility for health.

Despite this, the Bill remains an ‘England and Wales’ provision, and no plan has been publicly shared to explain how the UK Government might navigate these issues.

Transport: Trains and railways

HS2 is one of the few Welsh topics that broke confinement, and you may have already heard about, but I will summarise the issue here.

When a UK Government project is done that does not include one of the devolved nations, they receive a “consequential” – an amount of money calculated to be proportionate relative to their population, that they could spend on a similar project.

HS2 cost over £70 billion, which should have generated a Wales consequential of between £3.9bn (Plaid’s estimate) and £4.6bn (a number given by Welsh Secretary Jo Stevens when she was in opposition).

However, Wales will not be receiving this money, as the UK Government classified HS2 as an ‘England and Wales project’ despite none of the track running through Wales, and the UK Government’s own figures estimating that HS2 could actually cause the Welsh economy to shrink by £200 million a year.

Meanwhile, Wales’ transport system remains underfunded and unreliable: Only 3.7 per cent of Wales’ rails are electrified – compared to 33 per cent in Scotland and 44 per cent in England.

You still cannot travel between North and South Wales by train without entering England. Wales has 5% of the UK population and 11 per cent of rail tracks. We receive around 2 per cent of UK Government rail improvement spend.

Wales could really use that Barnett consequential.

Air travel and airports

Contrast the HS2 situation, where the UK Government is willing to let the Welsh economy shrink for the sake of the English economy, with Westminster’s response to the proposals to devolve Air Passenger Duty:
Air Passenger Duty (APD) is a duty charged on most passengers flying from UK airports.

Wales wanted the power to control this duty (a power Scotland already has), allowing them to scrap or reduce the fee. This would make it relatively cheaper to fly from Welsh airports than English ones and be a boost to the Welsh economy.

However, despite what was described as “unprecedented” popular support in Wales for this power to be devolved, the UK Treasury decided that, because this could have an adverse effect on Bristol Airport, the powers would not be devolved.

(Remember, the UK Government has the power over APD in England – if Wales scrapped the duty they could have done the same.)

In short, when it comes to transport: If it disadvantages Wales to make the English economy stronger, the UK Government are content, but any hint that this power dynamic might be reversed, and the Welsh Government will be stopped.

These examples may be common knowledge to some but most of Wales are not aware of just how much central Government are pulling the strings – to the detriment of our nation. The onus is on all of us to take notice, share the detail, educate others on a political system which can sometimes be (conveniently) confusing.

The issues facing Wales are interesting as well as important. The UK’s political conversations are broad enough to have space for Wales, but that requires us to take Wales & Welsh politics seriously.

Featured image via bmszealand / Shutterstock.

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Rhys ab Owen MS

Designation

Aelod o’r Senedd dros Ganol De Cymru / Member of the Senedd for South Wales Central

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