Wales could gain borrowing powers
Wales could be about to gain borrowing powers in a move that has been described as an “historic” agreement with the UK Government.
For the first time, the Welsh and UK Governments have established an agreement in principle for the nation to be able to loan money to pay for major schemes.
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Chief Secretary to the Treasury Danny Alexander said today's announcement was an important step for the people of Wales
Chief Secretary to the Treasury Danny Alexander said today's announcement "is an important step forward on the devolution journey for Welsh people."
Finance Minister Jane Hutt agreed it would be beneficial to Wales.
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She said: “The statement we are publishing today includes a new commitment by both Governments to review the path of Welsh relative funding at future Spending Reviews.
"I welcome the in principle devolution of capital borrowing powers, which should give the Welsh Government an additional lever to generate economic growth.”
The administration in Cardiff Bay cannot currently borrow money for large projects and relies on an annual grant of around £14.95 billion from the UK Government.
Unlike Scotland and Northern Ireland, who receive similar funds, Wales has no borrowing powers.
However, these powers will only come into force if the administration in Cardiff Bay raises its own funds.
Decisions on the devolution of taxes – which could provide a new source of revenue – will be made by Silk Commission, in a report which is due out on November 19.
Secretary of State for Wales, David Jones, said he hopes today's announcement will "reassure the people in Wales of the progress both Governments have been making on Welsh funding arrangements."
Community Housing Cymru Group Chief Executive Nick Bennett welcomed today's announcement, saying: "Wales, Northern Ireland and many English regions have been badly affected by 30 years of failure in regional policy across the UK.
"We need to be taking more responsibility for funding our infrastructure."
Comments
by abertawejack
Friday, October 26 2012, 10:42AM
“Oh great news (NOT) the road infrastructure that we have at present is paid through Government (Parliament) UK taxes, now Wales whom by the way has only "TWO" Motorways (unless I'm mistaken) under this system, now have to borrow money to pay for any new M roads etc we require........DUH! forgive me if I sound slightly bemused it's probably because I am. Far better we vote for Wales to join the European market interdependently, surely they can't treat us with such arrogant contempt as we are being treated now. between the costly Severn bridge tolls, we are a nation with double taxed standards, how does that old saying go um! if there's no bread give them cake.”
by Philosoraptor
Friday, October 26 2012, 9:03AM
“So while they are telling us on the streets not to borrow what we cannot afford, they pleaded with the UK Government to be allowed to borrow what they cannot afford?”
by odinhouse
Thursday, October 25 2012, 1:39PM
“'''' Debt '''' watch TV and typing the same time.”
by odinhouse
Thursday, October 25 2012, 1:36PM
“So does this mean that it will be '' councils -Wag - and the Uk Government will be borrowing more money that they may not be able to pay back, what will happen is the interest will be paid but Not the Loan. so we in Wales and may be Scotland will go into Dept. Just like other countries are , and look what is happening over there in their countries . Riots. . it's we the Tax payers that will end up worst off ...?”
by Dooyah
Thursday, October 25 2012, 12:48PM
“Borrow money?
You mean like Local Councils?”
by Stork
Thursday, October 25 2012, 12:37PM
“This plan would be a recipe for disaster if WAG was able to borrow money.
We would have the situation of Labour saying to Plaid, or other Parties. Give us your vote on this or that, to get it through, and you can have a road or a bridge on your patch, ok.
Wales would then be full of roads and bridges from nowhere, to nowhere.
What about the debt you say ? That's the next WAG's problem !”
by GorsseinonJoe
Thursday, October 25 2012, 11:13AM
“Beware of this, once the WAG has the power to borrow money and has "proved to central Government that they can repay the loan" I predict that tax raising powers, already on the agenda, will follow fairly quickly.
The people who will pay for any loans will be met by the taxpayers of Wales, so when the hair brained schemes to "improve" the infra-stucture, roads, and no doubt Cardiff as a European Capital city start rolling in, besides the Tax and National Insurance and VAT paid directly to central government will come additional taxes from the people of Wales for the loan repayment.”
by siarad2
Thursday, October 25 2012, 10:59AM
“"We need to be taking more responsibility for funding our infrastructure."
No we the peoples of Wales will do that through taxes, politicians take the glory, they couldn't even control AWEMA”
by newsaffair
Thursday, October 25 2012, 9:12AM
“Are we going to be taxed from Westmister,and then taxed from the Senedd?,some answers on this would be helpful.”
by spottydog
Thursday, October 25 2012, 9:01AM
“This is potentially very useful but more likely a disaster waiting to happen. You will have todays politicians making themselves look good with all these fancy schemes and then disappearing into the sunset when it comes to pay for it. The result - high debt, high taxes and misery for all of us. Sound familiar?”