By Richard Johnstone | 1 November 2013
Councils in England have called for extra financial powers to be given to local authorities following the government’s announcement that a range of taxes would be devolved to the Welsh Assembly.
The Local Government Association said that there were ‘huge implications’ for English communities from the government's plan to localise stamp duty and landfill tax to Wales, and hold a referendum on devolution of a proportion of income tax.
LGA chair Sir Merrick Cockell said councils would welcome similar powers. ‘Local government leaders in England will be thinking we want some of what they’re having.
‘A lot of places in England have distinct economic and cultural identities as strong as those in Wales and a shift in power away from Whitehall would help them deliver more jobs, faster economic growth and better public services.’
The proposed changes could also hit English communities on the border with Wales, which now face ‘an unfair, two-speed tax regime and an uphill battle to retain and attract businesses and jobs’, he added.
English regions were in danger of becoming ‘the poor cousins in the union’ as devolution hands Scotland and Wales a competitive advantage, Cockell said.
‘In taking steps to devolve more powers to Wales, the government has clearly recognised the economic, administrative and cultural benefits of shifting power out of Whitehall and handing it to local communities.
‘This is a policy which shouldn’t stop at the borders but spread out across the UK.’
Under the proposals, a plebiscite will be held in Wales to give it the country the same control over 10p of the base rate of income tax as will be given to Scotland from April 2015.
Borrowing powers will also be given to the Welsh Government so it can invest in major capital projects, such as the upgrade to the M4 in south Wales.
The announcement was welcomed by Paul Silk, chair of the Commission on Devolution in Wales.
The Commission published its report Empowerment and responsibility: financial powers to strengthen Wales, last November, calling for greater financial powers for the Cardiff assembly. It is currently working on the second part of its remit, reviewing non-financial powers, which will report next March.
‘Together with the UK government’s agreement on the use of the Welsh Government’s existing borrowing powers for key transport projects, today’s announcement is an important step in bringing greater empowerment and responsibility to the National Assembly for Wales,’ Silk said.
‘We made recommendations that we believed would strengthen Wales within the United Kingdom, and look forward to their implementation.’
