May I thank you, Dirprwy Lywydd? I'm speaking on tax devolution for Wales. I'm not sure if I've drawn the short straw in terms of the last short debate of the term, or whether the Minister has drawn it to reply to me, or perhaps you, Dirprwy Lywydd, in chairing us, but you are well used to that, so I thank you.

When we think about tax devolution for Wales, a key issue has to be how far should it go, and I've had two points in particular in mind in thinking about that. The first is the figure that the First Minister identified a while back as our 'fiscal gap', as he described it, of £13 billion, and I understand that as the difference between the tax revenue raised in Wales, whether from devolved or other taxes, and the amount of money spent in Wales. It's a very important figure. There's a very substantial net transfer of resources, basically, from England to Wales. That sum is somewhat different, conceptually, from the £13 billion, to the extent that we expect the deficit to be zero, over time, and that we might sustain a deficit that was a deficit, rather than a zero, but nonetheless the two sums, I think, have a certain convergence.

I think the more and more that we devolve tax and the greater the independence of our tax system, the more obvious that fiscal deficit becomes and the harder it becomes to have continuing consent to the level of that transfer. You see, in the debate in England at least, much more about Scotland than about Wales—sort of, complaints about what Scotland is able to do in terms of what's free there but isn't free in England, and I think a greater emphasis on a perceived unfairness in recent years' debate than was there before. I don't detect the same degree of emphasis on that fiscal transfer to Wales, but it is there, and the more and more we take control of our own taxes and raise our own taxes here, the more and more obvious that that transfer becomes, and I think that's an important point to bear in mind, and I think the basis on which devolution didn't happen in Wales in 1979, and the concern of many in the Labour Party, traditionally, about devolution and how equality across the United Kingdom and those transfers were more important and something that should be preserved. 

The other issue I consider in how far tax devolution should go is a desire for a stable settlement. I don't believe that devolution should forever be a sort of moving feast, let alone always, always in one direction. I would like to have a stable polity where there is broad consensus. Of course, it won't include everyone, but a broad consensus that these are the powers that we have in Wales and these are the powers that are exercised by the UK Government, and, in terms of tax, what taxation is raised here and what there. So, when we have supported tax devolution, it's been on the basis either that it's happened, or there is a settled view that it should happen. We had the Richard and then the Silk commission, and I sat on the Finance Committee both for the land transaction tax and for the landfill disposals tax and, in principle, supported them, because I felt they had been agreed through a sort of consensual approach, and while I'm not sure I would have argued from first principles for their devolution if it wasn't proposed, the fact that there was such agreement around that devolution convinced me to support them. Similarly with air passenger duty, where our group again decided to support the consensus, which we felt that the Minister rightly identified in that area. So, we add those to the devolution of the council tax and the business rate system and, from April this year, the Welsh rates of income tax.

We then looked at whether new taxes should be devolved. One concern I have in this area is the idea that somehow we should tax for taxation's sake, or we should tax in order to test the devolution machinery, and I first heard this from Mark Drakeford when he addressed the Finance Committee in Newport. Rather than saying, 'We should tax because we need that tax to fund those particular public services, and this is the best way of getting it,' it seemed almost as if the tax was seen as a good thing in itself. I understand that some taxes have behavioural impacts and, when people talk about a tax on plastic or a tax on vacant land, at least part of the reason for the tax is a desire to change behaviour. But, for me, that is a subsidiary issue to the primary one of needing tax to fund public services.