Another day, another statement by Hain. The Western Mail’s extensive coverage is here; the unexpurgated words of the man himself are here. The juxtaposition of the words attributed to the Presiding Officer in a rather different context (“Oh here we go now”) on the same page of the paper, and to the left of the piece on Hain, seemed strangely prescient.
He’s not alone in his love of hyperbole to make a point, but the suggestion that taxation powers for the National Assembly would "destroy Wales" seemed a bit far-fetched, even for him.
That’s not to say that taxation powers are necessarily an unmitigated opportunity for Wales; they are potentially a double-edged sword. But, and not for the first time, he puts up a straw man that no-one is seriously suggesting (an immediate move to full power over all taxation and expenditure) in order to knock it down – and dismiss more modest proposals at the same time.
The devil is in the detail; a move to a situation where the block grant is reduced by an amount equivalent to a certain percentage of income tax and the Assembly given the power to vary income tax to recover the lost grant is potentially neutral in its effects on both the Assembly’s total income and expenditure and on the level of income tax paid by people in Wales. And I suspect that’s much closer to what will potentially be on offer.
My doubts about such a proposal aren’t simply that a power to vary the level of tax (rather than merely recover the lost revenue) is a power which probably dare not be used. It's more that it adds little to the ability of the Welsh Government to vary the mix of taxation revenues in order to achieve goals beyond the merely fiscal.
There is one point in what Hain said where I actually agree with him, albeit only up to a point. He said that “We shouldn’t be ashamed or embarrassed... [of the fact that Wales needs more expenditure than we raise in taxation] …Wales’ needs are greater than most other parts of UK”. It’s a point I made in a piece on WalesHome a few months ago. Whether the ‘central government’ in question is a Welsh one or a UK one, it can and should be trying to mitigate the effects of geographical wealth inequalities.
Where I part company with him though is that he seems to be implicitly assuming that Wales’ relative poverty is an inherent, unchangeable fact of life which only redistribution by the UK Government can resolve. I find that depressing and defeatist; one of the best reasons that I can think of for rejecting Hain and his party is precisely that such thinking seems to be endemic to them. Where is his/their plan to build the Welsh economy to the point where we don’t need handouts? Where’s the belief in the ability of the people of this small country to turn things round? Where’s the positive leadership?
I don’t doubt that some would argue that he actually wants to keep Wales as it is, that a dependent Wales providing a block of safe seats to Labour in the UK Parliament is what best suits the Labour Party. I’ve had similar comments on this blog often over the years I’ve been running it. I don’t think it’s an entirely fair criticism, though. The outcome might well suit him, but I don’t believe that he’d deliberately hold us back for such self-interested reasons. A far more damning criticism is that he just doesn’t seem to be able to imagine any alternative.