FINANCIAL POWERS

posted in: Wales | 0

The Welsh Parliament needs the powers to raise funds and invest in local and regional economies. Too many of our communities have suffered decades of neglect. This cannot continue.

The Senedd and local authorities must have greater freedom from central government and Whitehall to raise funds from the low-interest Public Works Loan Board and in the capital markets.

The Council Tax should be replaced by a local income tax based on the ability to pay. This will end the unfairness inflicted on low-income households. 

As a result of Brexit, EU rules limiting the right of devolved and local government to award public procurement contracts locally no longer apply. That new power must be fully devolved to the Senedd, so that preference can be given to supporting jobs and businesses in our local communities.

Leaving the EU also enables the Bank of England to extend credit and bond purchase facilities to devolved and local government and other public bodies, which should be made full use of when the terms are more favourable than in the ‘free’ market.

The Barnett block grant formula does not recognise the needs of deprived working-class communities when allocating funds central funds to Wales and our local public services. It must be replaced by arrangements that do not disadvantage Wales.

In addition, the Senedd must have its own taxation powers to end the near-total reliance on central governments in London. These should include the right to retain a share of PAYE revenues generated in Wales, to raise the top rates of income tax and to introduce its own taxes and levies on wealth, development land and ‘luxury’ projects.

The benefits system is a vital lifeline for many. It’s not implemented fairly in Wales, where we have a higher incidence of sickness and incapacity benefits. Our own government should have the ability to supplement particular benefits where funduing allows and the ensure that they are administered humanely.

In current circumstances, for example, the Welsh parliament and government should have the power and resources to consolidate the £20 weekly uplift into the basic level of Universal Credit. At present, it is due to be withdrawn in October, tipping tens of thousands of Welsh families deeper into poverty.

Funding long-term care

The Welsh government recognised the challenge of planning for long-term care when commissioning the Holtham Report, Paying for Care. But there are significant gaps in the Report’s findings.

Holtham’s proposal for a ring-fenced social care portion of income tax ignores the potential that a tax on wealth and profits could have.

As Communists, we believe that accumulated private and corporate wealth as well as big business profits should play their part in funding social care. In Wales as elsewhere, that burden should not rest only or mainly on individual income tax payers.

For Britain as a whole, the Communist Party proposes to make the rich and big business pay for their bail-outs with a Wealth Tax; a windfall tax on the banking and other super-profits; an increase in top rates of Capital Gains Tax; and an immediate increase in Corporation Tax for large enterprises.