Need for strong voice over Wales’ future funding

Leading think tank, the Bevan Foundation, warns that Wales needs a clear strategy for future funding to avoid being left behind Scotland, Northern Ireland and English cities.

Wales’ leading think tank, the Bevan Foundation, has called for Wales to have a stronger voice on future funding to avoid being left behind other parts of the UK. It highlights how the next Assembly could be responsible for raising a fifth of its budget through taxation by 2020.

The comments coincide with the publication of the Bevan Foundation’s latest report, Devolved Taxes for Wales: The Context, which tracks the devolution of tax powers in Wales to date and contrasts it with Scotland, Northern Ireland and English cities.

The Bevan Foundation’s Director, Dr Victoria Winckler, commented:

“The Wales Act 2014 has given significant tax-raising and borrowing powers already, including business rates, council tax, landfill disposals tax and land transaction tax and, after a referendum, a Welsh rate of income tax. There’s also the potential to legislate for new taxes.

“Changing the way Wales’ block grant is allocated – the Barnett formula – is important”, she continued, “but it is not the only issue.  We are now in a different era. The block grant, whether fair or not, is shrinking rapidly and by 2020, devolved taxes could account for 20% of the Welsh Government’s budget. Discussions around Wales’ future funding need to move beyond grant-funding, especially as we approach next year’s Assembly elections.

“Scotland, Northern Ireland and English cities such as Manchester are all vocal about the sort of fiscal powers they want, but Wales has held back in recent years. The Welsh Government needs to spell out how it wants to see Wales funded – including the role of taxes – if the needs of people in Wales are to be met and to ensure that the new Welsh Revenue Authority is fully future-proofed.”

To download Devolved Taxes in Wales: The Context please click here.