The funding measures - part of the UK Government’s St David’s Day devolution package - involve introducing a “funding floor” to protect Welsh relative funding and provide certainty for the Welsh Government to plan for the future and grow the economy. It removes the final barrier erected by the Welsh Government to calling a referendum on income tax devolution.
Alongside that the UK Government announced that Wales should have additional powers over energy, transport, the environment and elections as part of a framework for devolution.
The framework - published just ahead of St David’s Day – sets out the UK Government’s plans for establishing a clear devolution settlement for Wales which stands the test of time. It is underpinned by the political consensus on further devolution secured by the Welsh Secretary through the St David’s Day process.
Welsh Secretary Stephen Crabb said the Welsh Government now needed to focus on how it could use these new powers to improve the Welsh economy.
The agreement says the National Assembly should be able to lower the voting age to 16 for Assembly elections, set its own speed limits and have control over fracking, sewerage, ports and taxi and bus regulation.
There was also political consensus that the National Assembly should be formally recognised as a permanent institution, enshrined in legislation, and have the power to change its name if it wishes.
It also says that Wales should move to a “reserved powers model” – in line with the model in Scotland - with the law setting out which responsibilities remain at Westminster.
Prime Minister David Cameron said:
The St David’s Day agreement we have reached today represents one of the biggest transfers of power in the history of Welsh devolution. This is about finding lasting settlements across the country to make our United Kingdom stronger and fairer.
It means more responsibility for the Welsh Assembly. It means more decisions taken here in Wales and more opportunity for the Welsh people to hold their politicians to account. And it means those who spend taxpayers’ money must also be more responsible for raising it.
I hope the next great debate is not about which powers should rest where, but instead about how these powers are used for the people of Wales. How both of Wales’ Governments can do all they can within their powers to make Wales prosper for decades to come.
This is devolution with a purpose.
An enduring settlement for Wales which works for Wales, today, tomorrow and for generations to come.
Deputy Prime Minister Nick Clegg said:
I am delighted to be announcing a new Constitutional Settlement for Wales. It truly is a deal worth celebrating on St David’s Day: taking us another step towards Home Rule in Wales and a fairer, stronger Britain.
The St David’s Agreement, which accepts the majority of the recommendations of the second Silk Report, increases the devolved powers at Wales’ disposal in important areas such as energy, transport and the environment. It paves the way for a stronger, more autonomous Assembly – giving Wales more control over its own affairs. And it starts the process of delivering fair funding for Wales.
We’re committed to devolution across all parts of the UK, and we have a strong record in Government. Together, we’re laying the foundations for a greener and more prosperous Wales. Our whole country will benefit, creating the jobs and growth we need to build a fairer society and stronger economy for all.
Welsh Secretary Stephen Crabb, who led a series of meetings with Welsh politicians to secure the framework, said:
This is a strong package that creates the foundations for a stronger, fairer, lasting devolution settlement for Wales. These new powers create an important opportunity for Wales, they are powers with a purpose.
As a UK Government we believe in rebalancing the economy to enable wealth to be created more fairly and evenly across the whole country. This St David’s Day package provides a toolkit to help the rebalancing of the economy here in Wales too.
I’m very grateful to all the Welsh parties for the spirit with which they’ve engaged with this process and for their willingness to make our starting point one of pragmatism and consensus rather than dogma and division.
As a small nation, I believe we pack a much bigger punch by working together and this will need to be the way we do things if we are now to deliver this package through legislation.
The framework’s recommendations include:
- Energy projects up to 350megawatts should be decided by Welsh Ministers. This would include most onshore wind farms and renewable technologies to harness tidal power
- The National Assembly should have powers over the development of ports to improve Wales’s transport infrastructure.
- The National Assembly should have the power to lower the voting age to 16 for Assembly elections. The Assembly already has the power to lower the voting age to 16 for a referendum on devolving income tax powers.
- All powers relating to Assembly and local government elections should be devolved. This includes deciding the electoral system, the number of constituencies, their boundaries, the timing of elections and the conduct of the elections themselves.
- Welsh Ministers should have the power to appoint one member of the Ofcom board to represent Welsh interests.
- A review should be carried out of Air Passenger Duty which could open the door for it to be devolved to Wales.
As part of the framework, the UK government has also pledged to examine the Smith Commission’s recommendations that are relevant for Wales.
This will enable the new government, following the General Election, to take decisions early in the next Parliament on whether any further Smith recommendations should be implemented for Wales.
Read the full St David’s Day document here