Group 4 is the final group of amendments, and they relate to the expiry of the power under section 1. The lead amendment in this group is amendment 2. I call on the Minister to move and speak to the amendment. Rebecca Evans.

Amendment 2 (Rebecca Evans) moved.

Amendment 2 tabled in my name is intended to address a concern that was raised at the Stage 2 proceedings. Currently, the power available to the Welsh Ministers to extend the life of the regulation-making power could mean new regulations may be made under that power for up to 10 years from the date of Royal Assent. That could mean that the longer term architecture for making changes to the Welsh tax Acts may not be brought in until the eighth Senedd. This amendment demonstrates my continued responsiveness and openness to work alongside the committees in the development of this Bill and, ultimately, the future arrangements for making changes to the Welsh tax Acts. The amendment sets out that the extension of the life of the power cannot go beyond an end date of 30 April 2031. It is intended to provide reassurance that the new arrangements will be brought in during the next Senedd term. However, this is still the maximum period. Ministers can still choose to make the extension shorter if they wish to do so.

Amendment 10 tabled by Peter Fox provides that draft affirmative regulations laid before the Senedd in relation to extending the life of the regulation-making power in section 1 of the Bill cannot be put to a vote before a minimum period of 28 days have passed from the date they were laid. A Government amendment was agreed at Stage 2, which implemented the committee's recommendation to introduce a minimum time of 28 days before made affirmative procedure regulations made under section 1 of the Bill could be voted upon. Peter Fox's amendment seeks to impose a similar rule in relation to regulations laid to extend the Welsh Ministers’ ability to use the power in section 1 beyond the five-year sunset date.

However, the two positions are very different; the amendment at stage 2 reflected the fact that there is no minimum period made affirmative regulations must lay for, and I agreed, in this instance, that it was appropriate that there should be, to reflect the fact that, where necessary or appropriate, and where urgent, substantial changes could potentially be made to the Welsh tax Acts through the use of made affirmative regulations. However, the established laying period of 20 days for draft affirmative regulations is sufficient for the purposes of this legislation. The reason I says this is because draft affirmative regulations do not come into force until they're voted upon. As such, in my view, they do not raise the same procedural concerns, and therefore do not require the same level of safeguard as made affirmative regulations. In light of this, I am not able to agree to this amendment.FootnoteLink

The Minister for Finance and Local Government wrote to the Chair of the Finance Committee on 12 July 2022 to clarify that there is a minimum laying period of 20 days for both made affirmative and draft affirmative regulations.

Amendment 10 inserts a minimum scrutiny period of 28 days, as we've just heard, before a vote on an extension Order made by the Welsh Ministers under section 7(2) can be held. Currently, as drafted, the Bill does not specify a minimum time in which the Senedd can scrutinise any attempt by the Welsh Ministers to extend the lifetime of the Act. As such, there are concerns that the Welsh Minister could attempt to hold a vote as late as the end of the Senedd term as possible to limit opportunities for scrutiny. This amendment is a compromise on an amendment tabled at Stage 2 in the name of Llyr Gruffydd. His amendment, which provided for a 60-day period, was rejected by the Minister as being too long. Thus, this amendment seeks to respond to the Minister's concerns whilst retaining the essence of the amendment tabled at Stage 2. Diolch.

It's a positive step in the first instance that the Government's accepted the need for a sunset clause, as the Minister mentioned earlier in this session. The Government's original choice, of course, was to do that after five years, with a one-off opportunity to extend the powers for a further five years, and I explained at Stage 2 of this Bill that my concern with that was that it was out of sync with the reality of the electoral cycle and that it wasn't ideal for practical reasons. You could perhaps say the same about the review of the legislation after four years, which would face the same problem, to a certain extent. If there is not going to be a review before the next election, then there will be no motive to include alternative arrangements in the party manifestos for the next election, and nothing in the manifesto would possibly mean that Ministers would say that there is no mandate for change in the next Senedd.

And likewise, in terms of the sunset clause after five years, to decide whether you continue with these arrangements or not, well, that debate, of course, wouldn't happen in the next Senedd until after the publication of the programme of government for the next Senedd, after the legislative programme was published. And I can hear the arguments now: 'Well, we have no scope to change things, we have no time to look at this', and then what we'll have is a kind of default where the five-year extension will be triggered. And, of course, we could find ourselves in the same situation at the end of that Senedd too, pushing the need for further reform not to the seventh Senedd, but to the eighth. So, the aim of the amendments in Stage 2 was to try and reset that timetable, to be pragmatic and to stick to a sunset clause after five years. But my original request was that we should only allow an extension for two years rather than five, ensuring that the next Government would have to get to grips with those broader reforms, rather than running the risk of finding ourselves not much further forward a decade from now.

I'm pleased, therefore, and I'm grateful to the Minister for compromising on this with her amendment 2, and amendment 1, which is consequential to it, which limits the extension of the legislation to the end of the next Senedd rather than five years. And as she said, it's 'up to the next Senedd'—it could happen earlier. My hope, certainly, is that this will help in ensuring that broader reform and alternative arrangements will happen at least before the end of the next Senedd, or, as she suggested, perhaps even a little earlier. Thank you.

The Minister to reply.

Thank you to colleagues for their contributions. I'm grateful to Llyr Gruffydd's recognition that this amendment 2 is tabled specifically to address the concerns that he raised at Stage 2 of the passing of the Bill, which I think is a pragmatic response to concerns that he and I know other colleagues have raised. So, I've been pleased to table this amendment this afternoon. But I reiterate this point that this is still the maximum period reflected in the amendment and that Ministers can still choose to make the extension period shorter if they choose to do so.

As I highlighted earlier, I just want to thank Members for their constructive approach to discussions on this Bill. As we can see here today, I've been willing to try and take the opposition amendments on board and consult Members on the wording of some of our key Government amendments, and, as I said, the result of that work that we have done together now has really changed the Bill in a positive way, and I think that it is further improved as a result of the votes that are being held here this afternoon. The amendments, I think, around the review process, and the sunset clause particularly, show that the Bill is now very different to the one that first entered the Senedd. I'm still very much of that view that I want to develop the architecture that can guide the long-term changes to tax legislation here in Wales.

Looking ahead to Stage 4, I think that if this legislation were to fail, it would mean that, for the next few years, the Welsh Ministers, and potentially our taxpayers too, would be left in a very vulnerable position where we might not be able to respond effectively to tax policy changes made by the UK Government that impact on our Welsh taxes and consequently on our revenues and our public services here in Wales. And just to provide an example, in the event that the UK Government introduced a new charging regime, similar to the stamp duty land tax higher rates for additional dwellings, such as second homes, we could find ourselves in a situation where we are significantly out of pocket in Wales. Or if there was a UK Government change that particularly benefited, for example, those seeking to establish new farming businesses where we wished to bring in similar types of changes at pace to ensure that our taxpayers aren't disadvantaged, we could find ourselves unable to do that as well.

But I just want to highlight my keenness to continue to work with colleagues across the Senedd on that longer term architecture. I want to be able to tell taxpayers that we took the chance when we had it to protect them and to protect Welsh revenues, but while we're working on that important longer term architecture, and this is the opportunity for us to do that as we go along what's an important journey ahead of us.

The question is that amendment 2 be agreed to. Does any Member object? No objection to amendment 2, therefore the amendment is agreed.

Amendment agreed in accordance with Standing Order 12.36.

Peter Fox, amendment 9—is it being moved?

Move—. No—

I thought that's what you'd said. It's not being moved?

No.

Amendment 9 is therefore not moved.

Amendment 9 (Peter Fox) not moved.

Amendment 10, Peter Fox, is it being moved?

Amendment 10 (Peter Fox) moved.

Yes. Move.

Yes. Amendment 10 is being moved.

The question is that amendment 10 be agreed to. Does any Member object?

Amendment 10. [Objection.] There's an objection. We'll move to a vote on amendment 10.

Amendment 10, in the name of Peter Fox. Open the vote. 

One Member is still to vote.

Close the vote. In favour 24, no abstentions and 25 against. Therefore, amendment 10 is not agreed.

Amendment 10: For: 24, Against: 25, Abstain: 0

Amendment has been rejected

We have now reached the end of our Stage 3 consideration of the Welsh Tax Acts etc. (Power to Modify) Bill, and I declare that all sections of the Bill are deemed agreed. And that concludes our work for today.

All sections of the Bill deemed agreed.

The meeting ended at 19:08.