The UK and Welsh governments need to work together and avoid a “pointless” situation where they are pulling in different directions, Lord German warns today.
The former Welsh Liberal Democrat leader will warn the House of Lords that levers to affect change in the Welsh economy are split and that two governments working in different directions creates a risk of overlapping and duplicating.
And he will call for a joint task force, calling on the best brains from both governments, to work on areas such as apprenticeships, finance for companies and inactivity reduction.
Tabling a question for short debate, Lord German will say that, despite 13 years of a National Assembly, economic performance in Wales still languishes at the bottom of the league and it needs to lose an overdependence on the public sector to “pull itself up by the bootstraps”.
He will tell peers that it is “crucial” that the ability of the Welsh Government to use financial levers is changed, expressing surprise that Labour has rejected income tax powers.
Lord German will say: “Despite 13 years of a National Assembly, economic performance in Wales still languishes at the bottom. There is an overdependence on the public sector and lower private sector development than is needed for Wales to pull itself up by the bootstraps.
“The UK and Welsh governments need to work together. The levers to affect change are split between the two, and working in different directions is pointless and can result in overlapping or duplication of support. While we wait for the Silk Commission to report, it is crucial that there are changes to the Welsh Government’s ability to use financial levers. It surprises me that Labour have rejected income tax powers. It isn’t about the variation of income tax, but about raising the tax base overall to give Wales a better income.
“It is important that the Welsh Government should have financial incentives to do better. It is something which should go alongside borrowing powers.”
He will add that apprenticeships, finance for companies and inactivity reduction are all areas where the UK and Welsh governments could work together. “Perhaps now is the time for a joint task force, for both governments to work together, drawing on the best brains in these areas,” he will say.
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