I call on a member of the Business Committee to formally move the motion. The leader of the house, Jane Hutt.

Motion NDM6332 Elin Jones

To propose that the National Assembly, in accordance with Standing Order 33.2:

1. Considers the Report of the Business Committee ‘Amending Standing Orders: Standing Orders 16, 19, 20 and 27—Budget Process and Finance Procedures’ laid in the Table Office on 14.06.17; and

2. Approves the proposal to revise Standing Orders 16, 19, 20 and 27, as set out in Annex B of the Report of the Business Committee.

Motion moved.

Formally.

I call on the Chair of the Finance Committee to move the motion under item 6 and to speak to both motions. Simon Thomas.

Motion NDM6333 Simon Thomas

To propose that the National Assembly for Wales:

Approves the protocol on the administrative arrangements for the scrutiny of the annual draft budget and other related budgetary matters agreed by the Finance Committee and the Welsh Government, laid in the Table Office on 13 June 2017.

Motion moved.

Thank you, Presiding Officer, and I’m pleased to move this motion and speak to both motions, and to explain that the passing of the Standing Orders and the associated protocol in Plenary today is the culmination of work that was started in the Finance Committee in the fourth Assembly. The devolution of fiscal powers has required a change to the budget process, which means that we as an Assembly will consider how the Welsh Government raises some of the money that it intends to spend with the new taxation powers.

Our predecessor committee undertook an inquiry that identified the best practice in budget scrutiny. Following publication of that report, officials of the Assembly and the Welsh Government have been working closely to develop a new process for scrutiny of the budget that is acceptable and workable for both sides. The new budget process should ensure a higher degree of scrutiny, and there will be more time for scrutiny by the Finance Committee and the policy committees alike.

This additional time should allow for the Finance Committee to consider the strategic high-level detail of the draft budget. I want us as a Finance Committee to look at: overall expenditure allocations; how the expenditure proposals will be financed, such as the amounts of financing from the block grant, taxation, borrowing, private financing, not-for-profit vehicles and any other sources; the level of capital borrowing and debt; the rationale for taxation levels; the economic statistics, analysis and forecasting used by the Government when preparing their budget; and, of course, the influence of the Well-being of Future Generations (Wales) Act 2015.

The role of the policy committees in scrutinising the draft budget is largely in the hands of each individual committee. But the process has allowed more time for policy committee scrutiny, which will, hopefully, allow for evidence to be taken from stakeholders, and each committee will be able to report in their own right. Additionally, committees can now suggest changes to spending plans, and they can suggest ways to finance these plans through taxation and borrowing.

We must now see how this new process is operated. But we will need to consider how the Finance Committee can keep its oversight role, and how committees can work together to engage better with the public in the budget process.

In making recommendations for the new budget process, the fourth Assembly Finance Committee visited Scotland to consider their process for scrutinising the draft budget. It’s therefore quite fitting that, last week, members of the fifth Assembly Finance Committee visited Scotland also, to meet our counterpart committee there and to consider their budget process.

The recommendations from the fourth Assembly’s Finance Committee were that we as an Assembly should change the budgetary process to a legislative one, but that, of course, wasn’t possible at that stage. Now, following Royal Assent of the most recent Wales Act, the Assembly now has the competence to move to a legislative process. Our visit to Scotland has reaffirmed my belief that this is the next step that we should be taking here in Wales, and the Finance Committee will shortly be commencing an inquiry that will look at how this will work and when we should be thinking about a move to a legislative process.

I would like to thank everyone who has worked towards developing this new budget process—the current Finance Committee, but also our predecessor committee, the current finance Minister, and Jane Hutt, as the predecessor Minister. I’d also like to thank officials here and in the Welsh Government for working so hard behind the scenes to put together these proposals.

Yn fyr, Llywydd, mae’r trefniadau newydd hyn yn caniatáu’r holl bwyllgorau i dreulio llawer mwy o amser—hyd at wyth wythnos—yn edrych ar gyllideb ddrafft Llywodraeth Cymru, gan baratoi adroddiadau ariannol ar y gyllideb ddrafft honno. Ac rwy’n gobeithio y bydd hyn yn grymuso’r Cynulliad i ddwyn y Llywodraeth i gyfrif ymhellach.

I call on the leader of the house to reply—Jane Hutt.

Diolch, Llywydd. The Welsh Government’s next draft budget will implement a different type of budget making in Wales. It will not only set out the Welsh Government’s spending plans, but also how some of those finances will be raised, as Simon Thomas says, using both our new tax powers—the first for 800 years—and our new powers to borrow. These are fundamental changes to the fiscal framework in Wales, and it’s right that we have a process that continues to provide robust scrutiny of the Welsh Government’s spending plans, and now also its financing plans. We look forward to putting this new process into practice in the autumn, and I’m pleased that the Finance Committee, and the Cabinet Secretary for Finance and Local Government, have worked together to agree these proposals.

Indeed, we started on this path, as you say, in the fourth Assembly. We also had a visit to Scotland on that occasion, as well, and, of course, your recent visit, I’m sure, was very enlightening. However, as we move forward, as we bed in our new tax-raising and borrowing powers, our budget will evolve. These changes to Standing Orders and the budget protocol provide flexibility to ensure that the scrutiny of the budget continues to be meaningful, proportionate, and robust, and the Cabinet Secretary is keen to continue working with the Finance Committee as these new arrangements are established. We also welcome the Finance Committee’s work looking into a legislative budget process, as Simon Thomas has mentioned. We look forward to hearing the outcomes from that work in due course from the inquiry that you’re undertaking. Overall, we support the proposals. Diolch.

The proposal therefore is to agree the motion under item 5. Does any Member object? No. The motion is therefore agreed.

Motion agreed in accordance with Standing Order 12.36.

The proposal therefore is to agree the motion under item 6. Does any Member object? The motion is therefore agreed.

Motion agreed in accordance with Standing Order 12.36.