CCC Fellow Richard Parry looks at the development and use of devolved powers after the Welsh Government decides not to make it easier to drive to England
On 4 June Mark Drakeford, the low-key former Professor of Social Policy who took over from Carwyn Jones as Welsh First Minister in December 2018, made a bold decision when he declined to authorise a new east-west motorway route south of Newport on the way to Bristol. Apart from general congestion, the most pointed problem is that the present M4 goes through a tunnel and reduces to two lanes in Newport’s northern suburbs. Newport (where I spent my primary school years) is getting sucked into the Bristol travel-to-work area and housing market, especially after tolls on the Severn Crossing were removed in December 2018. This is a reminder that Wales in organised politically north-south, bur economically east-west. In the 20111 Census 27.3% of the Welsh population were born outside Wales, 20.8% in England. Welsh devolution, passed by perhaps the smallest democratic vote in history in 1997 when half the electorate voted and just over half approved it, is advancing against the grain of networks that sustain ‘England and Wales’ as a potent concept that has lessons for Scotland as well.
The 2019 European Parliament elections showed the Brexit Party polling better in Wales (32.5%) than its British average. In the 2016 UKIP, having outpolled its British average vote in Wales in the 2015 General Election, won 13.0% of the vote and seven seats in the Assembly. The proportional voting system of devolution has offered political resources (such as paid jobs for members and their staffers) to parties opposed to it, who become domesticated to its workings. But their supporters are not similarly converted. In 2011 Welsh Conservatives supported the Yes side in the referendum on primary law-making powers for the Assembly although (according to the Welsh Referendum Survey) 71% of their supporters did not.
Conservative ministers at Westminster have pushed Wales in the direction of ‘responsible devolution’ on Scottish precedents, with greater fiscal powers in the Wales Acts of 2014 and 2017. From 2015-16 Non Domestic Rates were devolved and in 2018-19 a devolved Land Transaction Tax, replacing Stamp Duty Land Tax, and a smaller landfill tax. From 2019-20 Welsh rates of income tax are being set, requiring the identification of Welsh taxpayers. In the first year of the powers the rates have not been altered although a replacement of a 10p slice of all tax bands by a Welsh rate has been agreed with the Treasury in a Fiscal Framework which, as in Scotland, is more important than the original legislation.
The model is of own-revenue income streams being devolved and the block grant reduced accordingly. Estimating their magnitude is difficult and takes years of reconciliation between estimates and outturns. The UK Treasury has also included the esoteric requirement of the ‘block grant adjustment’. The idea that if the devolved tax effort (the product of tax rates and actual yields) rises or falls relative to England the grant should rise or fall also. Welsh governmental interests, for years looking at Scotland and Northern Ireland and complaining about the unfairness of the funding formula relative to their needs, have been ultra-cautious about accepting the fiscal powers being thrust upon them. For the SNP also, the accretions of tax and social security policy they have accepted, and the distinctive rates of income tax they have set, are risky extensions of political responsibility should costs or yields turn out unfavourably.
Close to the M4 tunnel is the notorious Bettws polling station where reportedly nobody voted in the election for Police and Crime Commissioner in November 2012. This was a reminder that the main area of Wales ‘devo-less’ compared with Scotland and Northern Ireland is police, justice and prisons. Wales never developed a distinct state in these areas and the permeable east-facing border is an additional reason for resisting powers that would have to be financed.
‘England and Wales’ is ironically echoed in the present Cricket World Cup – the governing body is the England and Wales Cricket Board but the team is England. With UK politics so Westminster-centric at the moment the devolved systems are compromised by UK reference points. Devolved powers are fine if you know how you want policy to depart from the English norms that dominate the discourse of UK parties, and can be paid for without getting enmeshed in Treasury funding tricks that make you wish you had never sought them in the first place. Drakeford’s decision on the M4 shows that the devolved systems can express distinctive political priorities – in this case an awareness of environmental concerns about the coastal eco-systems of the proposed route. It is also a telling commentary on the east-west connectivity issues that will continue to be an element in Welsh politics.