Archive for December, 2014

Last week of Assembly term

30 November to 5 December

Wales

The bill giving the Assembly tax powers has completed its passage through Parliament. Although there is a small matter of a referendum to be won if Wales is to have power to vary income tax rates, although the so-called “lockstep” proposal ensuring all income tax bands change by the same amount was being dropped. Now the National Assembly for Wales will be able to set separate Welsh rates of income tax for each band. Power over landfill taxes, stamp duty and aggregates levy will come the Assembly’s way in 2018 but income tax is unlikely to come anytime soon. Meanwhile a Welsh Treasury is being established, it’s uncertain whether the red box for Welsh budget day has been purchased yet.

Planes, trains and automobiles, no not a rerun of the film over Christmas but the Welsh Governments plans for transport over the next thirty years. Their short term plans include improvements to the A55, the A40 in Pembrokeshire, and north-south rail journey times  No Japanese bullet train to connect North with South unless of course the public demands it, for the plans are open to public consultation until next March.

The changing face of political campaigning  demonstrated by Leanne Wood of Plaid Cymru. She hosted a Facebook question and answer session. Apparently she received over a hundred of questions. Far better this than an irritating knock on the door in the middle of Corrie by the party canvasser.

Just like Christmas the figures on the gross value added to the economy of activites in the UK and just as regularly Wales is still the worst performing part of the UK in terms of money generated by its economy. The figures show Wales had the UK’s lowest GVA per head at £16,893 in 2013 while London had the highest at £40,215. For more analysis see http://welshpolitics.co.uk/2014/12/growing-but-still-way-behind/

Rest

Unlike Wales moves are afoot by the UK government to allow the Scottish government to issue bonds. The move should allow the Scottish government to fund borrowing through bonds from April of next year. Legislation will be introduced by the Treasury, which is expected to lead to the Scotland Office laying an amendment order before Christmas. It all stems from the Scotland Act of 2012, which gave ministers at Holyrood the power to borrow up to a total of £2.2bn from April 2015 for investment. The Act already permitted borrowing from the National Loans Fund and commercial loans, with bonds set to become a third option for reaching the £2.2bn limit if required. Scotland today, Wales in about a century.

Northern Ireland ministers have been pushing hard for more cash to combat the austerity agenda of the Westminster government. Cameron spent two days in the province to try to reach a deal on this and other difficult issues in the province. Both he and the Irish Taoiseach Enda Kenny left without a deal in place, but they said much progress had been made and local politicians could now solve the remaining issues. Cameron says he’s left “almost £1bn of spending power for the coming years” if agreement could be reached. But Sinn Féin’s deputy first minister Martin McGuinness said there was no  “new money,” said deputy first minister Martin McGuinness. Two politicians with very different views of the world, strange that eh.

In order to win back trust in his party’s economic competency Ed Miliband has set out his party’s plans to reduce the deficit. Dealing with the public finances will be an “essential test” of Labour’s credibility, the party leader said. He argued boosting wages and taxing the better off, in addition to budget cuts in most areas, could contribute to eliminating the deficit by 2020. So where is Miliband’s axe to fall. Well, stopping the winter fuel allowance for “the wealthiest pensioners”; capping child benefit rises at 1%; scrapping police commissioners; selling off “unwanted government assets”.and Labour would make savings of £500m in local government.  Will the punters vote Labour because their cuts are a little bit more kindly than those of the Tories? Hmmm

Polls

Tuesday

For Wales poll see http://welshpolitics.co.uk/2014/12/weak-labour-still-make-gains/

Monday

Ashcroft         Con 30%(+1) Lab 31%(+1) LD 8%(-1)  UKIP 19% (+4) Green 4% (-3)

Populus                   Con 33% Lab 36% LD 8% UKIP 15% Green 4%

YouGov/Sun  Con 34% Lab 33% LD 6% UKIP 15% Green 6%

Sunday

YouGov/Sunday Times  Con 32% Lab 32% LD 6% UKIP 17% Green 7%

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It’s a date and there’s no getting out of it

UnknownWhat a bright day it was when Mr Cameron and Mr Clegg stood in the Rose Garden of number 10 to pledge their troth. Many of the commitments made have since turned to dust.

No more so, than those heady commitment to sort out parliament itself. Reform of the House of Lords, well, no change there. The unelected lot can wrap themselves in ermine for a while yet,

Electoral reform – the Liberal Democrats got a referendum on their least favourite proportional system, the alternative voting system of electing members of parliament. A referendum that was duly lost, not least because the Prime Minister himself opposed it.

Consequently cutting down the number of MPs, a Cameron objective, was lost, why? Those Liberal Democrats decided it was pay back time for the failure of the conservatives to back the other changes. Indeed this one deed might have caused  the Tories the next election.

So what remains? The Fixed-term Parliament Act 2011.

Before this Act, the prime minister of the day could call elections as he or she saw fit.  The prime minister would keep the timing of the election  a very guarded secret and the date chosen would be for the maximum advantage of the government. The act removes that discretion.

Now the period between elections is set at five years with a fixed date for the  dissolution of Parliament and polling day. As a consequence voters now know that they’ll be heading for the polling stations next May.

Only two things could change this.  First a motion for an early general election is agreed either by at least two-thirds of the whole House or without division or; secondly, if a motion of no confidence is passed and no alternative government is confirmed by the Commons within 14 days.

Now Tory MPs have changed their minds. They want to revert to the old system. And you can see why. With the prospect of another hung parliament, going it alone as a minority government and holding an election when the runes read in your party’s favour must hold great attraction.

Recent research has shown that strategically timed opportunistic elections have allowed governing parties to realize an average vote-share bonus of just under 6 percent and seat-share bonuses of 12 percent, doubling the probability that the Prime Minister survives in office. Tempting eh.

But without a clear majority its unlikely that this act will be repealed. It certainly would not be in the interest of the smaller parties that  hold the balance of power to allow the government to choose the date. To be seasonal it would be a case of turkeys voting for Christmas. That ain’t going to happen, so the the Tories are stuck with the Act for a while yet.

 

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Growing but still way behind

photoFirst the good news Wales’s economy grew by 3.4% last year according to the Office of National Statistics. Wales and the the North West showed the highest Gross Value Added (GVA) increase  of all the nations and regions of the UK.

Now the bad news, Wales remains with the lowest GVA per head of all the regions of the UK. Indeed there remains a massive gap between Wales and London of £23,322. In London the GVA per head was £40, 215 whereas in Wales it was £16,893.

The figures become even starker when you go below the regional level. Inner London had the highest GVA per head at £71,162 whilst West Wales and the Valleys had the lowest at £14,763.

£56,399 is a massive gap and goes a long way to explain why these parts of Wales continue to receive European money to stimulate the economy and raise the areas out of poverty.

Ynys Mon has the lowest level of GVA with £11,368 wheras the highest is the West End of London with a GVA of  a staggering £135,888. Perhaps the subsidy should not be to fly civil servants from Cardiff to Ynys Mon, but rich Londoners to the area to spend their ill gotten gains.

The GVA measures the increase in the value of the economy due to production of goods and services, It’s a good indicator of the economic activity of an area.  On that basis Wales can still be seen to be a basket case.

The figures also underline the economic imbalance in the UK with London and the South East way ahead of the rest of the UK. They’ve benefitted with large sums been pumped in infrastructure schemes such as the Olympics, the Channel tunnel rail link and now Crossrail. You can hardly visit a station in the London area without it having received or under going a facelift.

Last year, the construction skills industry training board forecast that Greater London would receive more economic-development spending than than Scotland, Wales and Northern Ireland put together.

The truth is that since the crash London and the south-east have continued to pull away from the rest of the national economy. The wedge between them and the rest of Britain has been driven in deeper. These latest figures show the divide is continuing to grow.

Clearly leaving the economic levers in Westminster’s hands is not benefitting Wales.  The case for more powers over the economy to be devolved is overwhelming and should happen sooner without the need for a wasteful referendum. Wales can’t afford more prevarication.

 

 

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