The Welsh government is facing unprecedented challenges. Both its new ideas and attachment to old principles will come under the microscope, argues Victoria Winckler
WALES is facing very tough times – tougher than in most other parts of Britain. It has one of the lowest employment rates, highest levels of economic inactivity, among the lowest median hourly pay rates, and the value of the goods and services it produces per head is so low Wales is likely to qualify again as one of the European Union’s poorest regions.
Attempting to achieve social justice and prosperity against this backcloth is Britain’s only Labour government. Note the word ‘attempting’, for, despite Welsh Labour’s vision for a ‘fair Wales’, its ability to achieve it is constrained by a number of factors.
Not least of these is the nature of the devolution settlement. Unlike the Scottish government, the Welsh government has to operate with relatively limited powers. It is a mere three months since the Welsh assembly passed the first legislation for which it did not have to ask Westminster’s permission following the Government of Wales Act 2011. Even with these legislative powers, the assembly’s competence is partial, covering most aspects of health, education and local government, for example, and a hotch-potch of powers on issues such as the environment, but with little if any competence on taxation and benefits, the economy or criminal justice.
The Welsh government’s hands are further tied by its funding, which is provided as a block grant calculated by the Barnett formula. This essentially gives Wales a pro-rata share of England’s spending. So, if the UK government decides to cut spending on education by 10 per cent, Wales’ funding is also cut by 10 per cent irrespective of the Welsh government’s intentions.
And last, but by no means least, Labour does not have a majority in the assembly. With 30 out of 60 seats, it has to cooperate with other parties to get key decisions, and particularly its budget, through the assembly. In 2012, the deal on the budget was with Plaid Cymru; a year before the deal was with the Liberal Democrats.
Yet, despite these extremely tight constraints, Labour in Wales is quietly pursuing an anti-austerity package, although it does not use that term. To many casual observers Welsh Labour’s approach is unexciting, mainly because its headline approach has been to hold on to pre-austerity policies. Neither the 2010 general election nor the 2011 Welsh assembly elections brought a significant break with previous priorities. So, Wales still has the education maintenance allowance, free NHS prescriptions and bus travel for the over-60s, and has kept almost all schools within the maintained sector and continues with a largely public sector-provided, demand-driven NHS. The most recent example of Wales sticking with the tried-and-tested was the Welsh government’s decision to retain GCSEs when education secretary Michael Gove decided to scrap them in England (Gove has since reinstated them, at least for the time being).
One of the difficulties for the Welsh government is that most of its policies are not packaged into shiny new ‘isms’ but have simply rolled on from the last 14 years of Labour-led administrations. But those who find the Welsh government’s agenda staid should look more closely.
In its most recent crop of policies and proposed legislation, from the white paper on housing to the draft social services bill, its consideration of a new bill on public health and one on domestic violence, there are innovative and sometimes radical proposals beginning to emerge. The housing white paper, for example, is based on a ‘whole system’ approach to housing, with affordability and stability being key principles. Proposals include regulation of landlords and improvements to the quality of privately rented homes; reform of tenancies; a focus on prevention of homelessness and redefinition of ‘priority groups’ of homeless people; funding to bring empty homes into use; and allowing local authorities to increase council tax on properties empty for more than a year.
Indeed, that there is too much to cover in an article of this length demonstrates the breadth, range and ambition of much of the Welsh government’s most recent activity.
In the assembly, too, there are new developments, such as draft legislation to make businesses and insurers reimburse the costs incurred by the NHS in treating patients with asbestos-related diseases, a refusal to endorse the abolition of the Agricultural Wages Board, and new ideas around social care.
It is fair to say that the areas in which the Welsh government and assembly are developing the most robust and distinctive agendas are those which are most fully devolved. In others, there is much less of note: its Tackling Poverty Action Plan was widely regarded as weak not least because so many of the obvious levers of change – taxation and benefits – are at Westminster. Its economic development policies struggle in the face of long-standing problems in Wales as well as global and UK-wide stagnation, yet even here programmes such as Jobs Growth Wales (which creates jobs for 16-24-year-olds) and its investment in a raft of capital projects, despite the severe cuts in the Welsh government’s capital budget, are attempting to stimulate the demand side. Extremely modest they may be compared with the scale of the problem, but as a restatement of public intervention in the economy they are welcome.
Not everything is perfect, of course. Some of the Welsh government’s draft plans are flawed, mainly because they are heavy on vision and light on delivery as has often been the case with its plans in the past. Many of its policies could do with greater use of evidence to inform good intentions. The Welsh government also needs to be clear about how it will achieve its ambitions – the questions of ‘who, what, how, by when and for how much’ are too often left unanswered or only partially so.
But having bright ideas and generating a flood of white and green papers is not enough. The Welsh government has to prove that its approach not only delivers, but delivers better outcomes than the English or Scottish alternatives. And, to add to the pressure, it also has to deliver at a time when its budget is shrinking and when needs, from Wales’ well above-average older population and from welfare reform, are rising dramatically. And this is the sticking point. To date, educational attainment in Wales and waiting times for NHS treatment have not stood up to comparison with performance across Offa’s Dyke. There may well be myriad reasons for the differences, not least deep-seated poverty and inequality, but the stark facts remain: performance in Wales is worse. David Cameron wasted no time reminding assembly members of this in his speech to them in July 2011: ‘Let me be frank. Like many other parts of the UK, some public services in Wales are currently too bureaucratic to deliver those improvements. I believe now is the time to modernise our public services, and in England that is what we’re doing. I also believe that more open public services could do the same in Wales.’
A great deal of future public policy for the UK therefore rests on the Welsh government’s shoulders. It is not just its new ideas that are being put under the microscope, but the old principles of universalism, of traditional non-marketised public sector services and of economic interventionism.
Opposition parties will be watching closely to see if and how Wales succeeds. So too should the Labour party.
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Victoria Winckler is director of the Bevan Foundation, an independent, membership-based thinktank in Wales. She writes in a personal capacity
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