I welcome the opportunity to debate the Finance Committee's report entitled 'Inquiry into the financial estimates accompanying legislation'. This is a hugely important topic, because money spent in implementing new legislation is money not available for current services. We sometimes debate here as if there's some sort of new money coming from somewhere—perhaps Theresa May's money tree—for new legislation. It isn't. It's coming off existing services. So, it is very important that the cost of all legislation is calculated. I think Nick Ramsay is absolutely right about capital and revenue, but we also need set-up costs on the revenue side, because there'll be revenue costs that will fall in the first year for set-up that won't occur in future years. Something that's worthwhile at £1 million may quite often become unaffordable at £1 billion. I greatly believe in two things: looking at opportunity cost and looking at cost-benefit analysis. When you're spending money on one thing, you're losing the opportunity cost of spending it on something else.

The committee recommends that the Welsh Government should ensure that the RIAs are explicit in their division between cash costs and savings and monetised costs. This is important to distinguish between cash and non-cash savings. An example of where a Bill went wrong is the additional learning needs Bill, where the non-cash savings, in this case volunteer time, were counted as a cash saving. Whilst volunteer time may be used in the community for other community good, its cost cannot be taken into account when calculating the net cost of a Bill. This severely distorted the cost savings of the Bill. This affected the net cost of the Bill. The cost then had to be recalculated. The resultant cash costs were substantially higher. Also, it is important to identify who the costs are going to fall on, who is going to pay for it, and where the benefits will accrue. I think we really do need, when we're passing legislation—. And we pass legislation because it's good, but would we pass some legislation that is very good, but it's going to mean that something that we feel equally or more strongly about is not going to be able to be done because the money's just been spent on this?

The committee recommended that the Welsh Government thoroughly consider the financial implications for all stakeholders in regulatory impact assessments, including ensuring that the financial implications of the private sector are considered. We passed a piece of legislation in the last Assembly where the cost fell on the public sector and the benefits were in the private sector, but I think that it's important that we identify who are the winners and losers. There is always a danger in creating legislation that it will create additional demand for service, a sort of latent demand. In fact, just talking about it here, getting it on the BBC and in the Western Mail will create additional demand for services that people may not have known they were able to get.

I would like to highlight recommendation 7, where the committee recommended that where there are changes in the RIAs after Stage 2, the Member in charge should provide to the Finance Committee and the relevant scrutiny committee a summary of these changes, including the financial implications. This takes me back to the first point: there is a danger that, once a Bill has passed Stage 1, it has something called momentum, and it's going forward, and everybody's in favour of it. Because with most Bills here, there's a bit of an argument over them, but most people think the general thrust of them is a good idea and it's going to make things better. And it's considered value for money when it's costing £5 million or £10 million, but once the cost escalates at Stage 2, that momentum is driving it forward. Everybody's behind it, and even those people who are going to vote against it and are critical of it are critical of bits of it, but actually like the general idea of it. So, what would not have got through Stage 1 with the correct legislative costs now keeps going forward. The cost increases, but it becomes difficult to stop going forward with legislation. How much would legislation have to increase before we actually took a stand at Stage 2 to say the Government should withdraw it, or we as an Assembly say, 'Look, this is getting too expensive'? I think that is why it needs to go to a committee: for us to look at it dispassionately. There's a need to have people outside Government to re-examine, at both the subject committee and the Finance Committee.

I also accept that producing cost and cost saving for legislation is complicated, often needing a detailed understanding of the service and how it is funded and who uses it. Realistically, costs and savings will be in a range based upon assumptions that have been made. I have always believed—not that I've got much support among other people—that we should actually have a range of costs and a range of savings being published, and the mid point being used in calculations, because that's actually what people must be doing. They're making assumptions and they're saying, 'Well, we'll take 50 per cent of that, and 75 per cent of that'. This will allow those considering legislation a better insight into costs and benefits. Finally, stating the obvious, if costs are higher than expected and savings are less, other services, which many of us rely on, will have less money.