Committee calls for Senedd to take on a bigger role in setting the Welsh budget

(Title Image: Senedd Cymru)

Finance Committee
Legislative Budget Process (pdf)
Published: 6th August 2020

  • Committee recommends independent group is set up to consider an annual Finance or Budget Bill.
  • The Senedd would take on a bigger role in approving the Welsh Government’s spending and tax plans.
  • Any new system would need to be flexible enough to account for slow UK Government decisions and to provide funding certainty to Welsh public bodies.
  • Pre-budget debate on Welsh Government spending priorities should be kept.

“In any modern democracy it is key for a parliament to properly hold a government to account, especially on its spending plans and tax levels. These are decisions that affect people’s lives every day and we want to make the process fit for the future, ensuring it is simple, transparent and that the government is truly accountable to Members of the Senedd and the people of Wales.”
– Committee Chair, Llyr Gruffydd MS (Plaid, North Wales)

At present, the annual Welsh budget is tabled by the Welsh Government as a series of documents. Although the Senedd gets a debate and vote on those documents, moving to an annual Budget or Finance Bill would mean the budget would be set as a law, giving the Senedd a greater say.

Legislative budget process would better reflect the Senedd’s maturity

The Committee concluded that moving to a legislative budget process would properly reflect the far more extensive fiscal powers at their disposal and provide a greater balance between the Welsh Government and Senedd when it comes to financial powers.

That said, more detailed work would be needed on how such a system would work, based on the experiences of the Scottish Parliament – which uses a legislative budget system, as does Westminster.

In Scotland, only the Scottish Government can table amendments to the Budget Bill itself. Committees can table reasoned amendments to earlier budget motions to, potentially, force a re-think.

Flexibility and improved public engagement required

The UK Government still retains strong controls over how the devolved nations set their budgets. In the past year, there have been problems setting the Welsh budget due to delays to the UK budget and spending reviews. There were knock-on problems for organisations – like the NHS and local government – which are funded from the Welsh budget.

The Committee believes public engagement should be at the heart of any new process, though they weren’t clear on when in the budget process, or in what form, that should take.

They did, however, support the continued tabling of a pre-budget debate on the Welsh Government’s spending priorities before summer recess each year.

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