This BBC write up of the joint SNP-PC press conference (held, ironically, in London) mentions what appeared to be the main thrust of the full coverage which I saw on the BBC Parliament channel*:
Mr Wyn Jones said... "We promise a strong block of Plaid and SNP MPs to fight for fair funding for Wales and Scotland, to protect local services and the most vulnerable in society, protecting them from the cuts agenda of the three main London parties, push the green agenda and push for business growth."
He and Alex Salmond kept referring to 'the London parties' and funding from 'Westminster'. Sure, this type of pork barrel pleading is what you'd expect - they want to get as much money from 'London' as they can, and I am sure that they will, but there is an upper limit to how much they can get (and it might well be less than what they get now). They also paid lip service to the idea that they want to get the private sector in their own countries going again, fair enough.
But they ignored or overlooked a third flow of money over which they have a lot of control, namely the flows which are a result of the restrictive planning system. Home-Owner-Ism is just as rife in those countries as it is in England, which forces Welsh and Scottish people to take out much larger mortgages than they really need to, and most of the interest that they pay goes 'to London'.
If I were in charge in Wales or Scotland (but not allowed to change the tax system to more locally collected property taxes and less nationally collected income taxes**) the next best thing I could do would be to liberalise planning laws. That would make it cheaper to rent or buy business premises; and it would make it cheaper to rent or buy houses. Because people spend the bulk of their money locally, all the rent that is longer being sucked out of the productive economy, and all the interest that is not being syphoned off 'to London' would slosh round the Welsh or Scottish economies instead.
What can possibly go wrong?
* The physical contrast between Wyn Jones and Salmond is quite comical, Wyn Jones is a small, thin, pale grey man, and Salmond appears to be about two foot taller, two foot wider and slightly larger than life. This is not so obvious from the picture accompanying the article.
** Both SNP and Plaid Cymru, like the Lib Dems, have the insane idea of replacing Council Tax with Local Income Tax - brilliant politics but terrible economics.
As I have said before, the problem with Council Tax is not that it is a property tax, the problem is that it is a Poll Tax. At the very least, we could increase the number of bands. If we had from Band A all the way to Band Z with a 20% gap between each band (as at present), then Council Tax on a Band A property would be £50 or £100 a year or something and for one in Band Z it would be £5,000 or £10,000.
There’s a Surprise
9 hours ago
8 comments:
If David Cameron makes it to No 10 I would give Scotland and Wales (even though I am Welsh, never believed in regional government still don't)short shrift. They have both opted for the socialist option of regional government, treat them like Cuba see how they get on in their paradise without English subsidies.
They will end up having to resort to cattle raiding across their borders to survive.
Currently in Switzerland. I've been told it has "Schedule A" style taxation.
No wonder it's such a nice place.
Mark, planning in Wales is already considerably more liberal than in England. Many fewer NIMBYs, except where there are large populations of retired English, a tendency to view things like planning regulations as made by the English to oppress the Welsh, combined with historic nepotism mean that developments of most kinds are far more likely to go ahead than across the border. As I mentioned before, down here we are having or have had built two LNG terminals and a power station in the middle of a National Park. You wouldn't get that in England.
A, yes, agreed, but don't confuse the people with their government.
AC1, indeed, I covered that here.
B, good for them. But house prices are still ruinously high compared to average wages.
"But house prices are still ruinously high compared to average wages."
Partly due to the English moving here because they can't afford to buy in England, especially in the prettier parts. This is also true in many places on the Continent, too.
B, that may be a part of the explanation. But the Welsh can get their own back by continually building more houses wherever the English start buying.
The banding as it stands is bizarre. The reason they won't put in a more equitable system? Money of course.
JH, the real reason is not "money" it's "votes".
But what is really bizarre is that
a) The bands are softened at the lower end with Council Tax Benefit (90% of CTB claimants are in Band A or Band B homes), and
b) they are capped at the top so that houses in the top two deciles pay no more than houses in the third decile BUT then it is exactly these top two deciles that get clobbered with 4% or 5% Stamp Duty and 40% Inheritance Tax,
... so if you even it all out (CT plus SDLT plus IHT) the whole system is in fact fairly flat. Once you chuck in other taxes like CGT, TV licence fee, VAT on domestic fuel and Insurance Premium Tax, the whole system is even flatter, so why not just replace the whole lot with a flat % rate property value tax and have done with it?
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