Thursday 3 November 2011


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.


Boncath said...


Spot on again

Nice touch for Hain to say that the cause of relative poverty in Wales ie England and Westminster is the only hope for its resolution.
Its a bit like being bled to death by leaches and being told it is good for you

The problem we have now is State dependency

In Pembrokeshire sine the mid 80,s
we have attracted an elderly population and or those with major medical needs. Also regretably those who want a seaside lifestyle on benefits

There has been virtually no effort made to attract serious economic activity to benefit the local economy

maen_tramgwydd said...

If people vote Labour, they get Hain and Touhig etc

That goes for Plaid too... IWJ, DE-T, RhGT and so on.

Apart from Gillan, Redwood et al, we get the politicians we vote for.

What is it about Wales that we have a dearth of good political leaders?

I suspect it's because we've been ruled by others for centuries and we've lost confidence in ourselves.

Jeff Jones said...

I've read the article on Wales Home and found it pretty depressing to be honest. People should read Alan Trench's recent memorandum to the Scottish Parliament's Committee looking at the Scotland Bill to see that some form of revenue raising is the norm for most devolved administrations in the world. In the 1980s local authorities raised much of the money that they spent. In some cases where there was a strong tax base such as in London the authorities did not receive any grant from central government. In other cases authorities did receive a grant to compensate for the issues such as inequality that Peter Hain rightly talks about. But they still raised the bulk of their expenditure through the domestic rates and the business rate which was then set locally. It can be done without the world as we know it collapsing. It leads to more accountabilty and a much more mature approach to politics. If we are not careful in Wales we are going to have a rerun of the 1980s blame culture where it is all the fault of the Tories. It plays well with the core vote particularly if it is over 60 and still living in a world which stopped in 1979. It will even win in the short term Assembly and local government elections which is important for a professional political class which relies on the money that now follows election to office. What it wouldn't achieve,however, is any re engagement of the majority of voters with the political process. A mature political party would accept that the Assembly has to directly raise some of its finances. It would then start to discuss the percentage that needs to be directly raised and what taxes are required. These taxes could go beyond just simple income tax. Why, for example, haven't we got a tourist tax which is the norm in so many European countries. If we are going to have a plastic bag tax why has it got to go to the good causes approved by the supermarkets? Unfortunately in Wales we have too many politicains who seem too frightened of their own shadow to even do anything radical. Welsh politics would be far healthier if we had a real debate amongst politicians about tax and spend.

John Dixon said...


” What is it about Wales that we have a dearth of good political leaders? I suspect it's because we've been ruled by others for centuries and we've lost confidence in ourselves.”

I don’t know about that. It might just be over-confidence rather than under-confidence – on the part of the politicians at least. The nature of the job is that it requires a high degree of self-belief, and many of them genuinely believe that we’d be better off with them at the helm than with ‘the other lot’ in charge.

The problem arises when they start to believe that the only way for them to be ‘in charge’ is to say what they think their target audience wants to hear rather than offer any original leadership.

There is a saying, attributed to the French radical, Alexandre Ledru-Rollin, “There go my people. I must find out where they are going, so that I can lead them there” (although apparently he actually said “There go my people. I must follow them for I am their leader”).

Either way, I’ve long believed that it is the job of politicians to lead, not follow, and certainly not simply appeal to prejudices and lowest common denominators.


I completely agree with you that having a degree of control over, and accountability for, the income is a requirement for responsible mature politics. It says something that I had more power to raise revenue as a community councillor for fifteen years than AMs do.

And as for ” Unfortunately in Wales we have too many politicians who seem too frightened of their own shadow to even do anything radical”, I couldn’t have put it better myself.

I’m pretty sure that you wouldn’t agree with everything maen_tramgwydd said above, but the lack of mature leadership is a common thread.