Senedd rejects Conservative calls for £660m tax cuts

Senedd members voted down Conservative calls to cut taxes for 1.7 million people in Wales.

Sam Rowlands said his party would use devolved tax powers to put more money back into people’s pockets, saying the average working family would be £450 a year better off as a result.

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The shadow finance secretary explained the Conservatives would cut the basic rate of income tax by 1p, with people paying 19% in the £12,571 to £50,270 band.

The Tory motion also called on the Welsh Government to restore tax relief for the hospitality sector to 75% and abolish business rates altogether for small companies.

Mr Rowlands told the Senedd: “We believe people up and down Wales know how to spend their money better than the government does.”

‘Serendipity’

But Heledd Fychan, Plaid Cymru’s shadow finance secretary, warned deep cuts to public services would be needed to find almost £300m for such an income tax cut.

She said: “Unfortunately, although we have bidden farewell to the Tories from 10 Downing Street, any hope for change with the arrival of a Labour government has also been dashed

“The pledges of no additional taxes on working people and no more austerity have been utterly demolished by their actions.”

Labour’s Mike Hedges argued: “Taxation is the price we pay for being part of a civilised society. We cannot have Scandinavian-quality public services and American levels of taxes.”

He added: “It's not by random chance or serendipity that those countries with the highest tax levels have the best public services, and those with the lowest tax levels are the poorest.”

‘Economic scoundrel’

Finance secretary Mark Drakeford began by referencing Winston Churchill’s response when asked about the message voters had given the Conservatives by booting them out in 1945.

“He replied by saying he thought the electorate had said to the Conservative Party it needed to be a very long time before they heard from them again,” the finance secretary said.

“That was good advice in 1945 and it's very good advice 80 years later.

“If there's any topic on which the Welsh public was entitled to a period of silence from the Conservative Party, then surely it was the economy. Because here is a party that gave the people of Wales austerity, … Brexit, the party that raised taxes to a 70-year high.”

Prof Drakeford told the Senedd the Tory motion would cost the public purse £660m in total.

“We heard the pretence that all that money… can be found from waste,” he said. “The last refuge of any economic scoundrel, it seems to me, that idea.”

‘Vote this out of its misery’

The former first minister rejected the notion of closing overseas offices as he made a case for inward investment and economic growth.

He said: “The other idea I heard was that it was to come from the Heads of the Valleys road… there is no saving at all to be made from that bright idea.”

“Instead, the money will have to come from social services for older people, services for children in care, support for bus services, cuts to childcare and to colleges, cuts to support for businesses, cuts to housing support and homelessness services.

“There is no way at all – in the real world of government – that the budget consequences of this motion could be accommodated without harm.”

Prof Drakeford urged members to “vote to put the original motion out of its misery”.

‘Choke the life out of it’

Darren Millar, leader of the Tory opposition, hit back, saying: “Well, as entertaining as they are, I will take no lectures from Professor Drakeford.”

Replying to the debate on May 14, he accused Labour of trashing the economy: “We've got taxes going up, unemployment going up, growth going down, new jobs tax, new inheritance taxes for people to pay, new tourism taxes on the way and massive hikes in council tax.”

Mr Millar warned taxpayers are getting increasingly less in return, with cuts to bin collections, libraries and public toilets as well as more potholes and litter on the streets.

“It is totally unacceptable and that's why we need to see a change,” he said. “I am proud to say I'm a Conservative because I believe in low taxation, unlike the parties on the left whose instinct is to tax anything that moves or anything that thrives and to choke the life out of it.”

Senedd members voted 33-12 against the Tory motion before the Welsh Government’s “delete all” amended version was agreed, 23-13 with nine abstaining.