3. Statement by the Minister for Finance and Local Government: Response to the UK Government Financial Statement

Part of the debate – in the Senedd at 2:46 pm on 27 September 2022.

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Photo of Llyr Gruffydd Llyr Gruffydd Plaid Cymru 2:46, 27 September 2022

I feel that this whole episode really graphically demonstrates how fiscally beholden this Senedd is to changes that happen, sometimes at a whim, sometimes driven by dogma, at Westminster. We can complain about abolishing tax bands, about changes to NI, to levels of co-operation, but wouldn't it be better, Minister, rather than complaining, that we actually had the powers here to do something about it? Not just little extra borrowing powers here or there, but a real fundamental overhaul of the fiscal powers that are devolved to Wales. The current fiscal framework isn't fit for purpose; it really exposes how weak Wales's hand is when it comes to protecting the people of Wales from this kind of Tory onslaught on our most vulnerable and our poorest citizens. So, will you join Plaid Cymru in calling for maximising fiscal powers to Wales so that we don't end up being just some sort of buffer Parliament, passing on as little of the pain as we can, and that you, having listed a number of issues that you wrote to the Chancellor about earlier, don't end up having to write to somebody else all the time asking for this, that and the other, but that we actually have the powers to do so ourselves? I trust that you will support us on that.

There is one glaring omission in your statement. As far as I can see, you say nothing about the basic rate of income tax. You rightly oppose the abolition of the additional rate of income tax and you outline plans on land transaction tax. Am I, therefore, right to presume that the Welsh Government is actually adopting the Tory policy on this, effectively depriving the public purse of critical funds that it needs to protect the poorest and most vulnerable in society? Is it not the time, Minister, to utilise some of the tax-varying powers that we have in Wales, not to cut, or to increase taxes in this case, but actually just to keep them at the current level? Doing so would generate an additional £200 million for the Welsh Government to protect those essential services that people are going to be leaning more heavily on than ever before. I agree with Andy Burnham. He says this isn't the most targeted way of using the resources that we've got at this moment in time. So, I'm calling on you, Minister: will you use the powers that you have to protect the basic rate in Wales at 20p in the pound, because that money will help save livelihoods and help save lives?