Timid tinkering isn’t enough – we need bold new ideas to tackle Wales’ economic challenges

Adam Price: Picture by Plaid Cymru (CC BY-NC-ND 2.0)

Adam Price, Plaid Cymru Leader

“It’s the economy, stupid.”

It wasn’t designed as a campaign slogan, but the words of Bill Clinton’s strategist, James Carville have forever led us to the nub of political thinking.

The economic challenges facing Wales are numerous but not insurmountable.

Those who defend the constitutional status quo impetuously, even gloatingly, highlight the fiscal gap as a reason why we can’t control our own affairs.

Wales is not unique. Across the UK, nine of the 12 Territorial Unit Regions for the purposes of statistics are persistently in deficit. Addressing this issue is not simply a fiscal or economic matter but has a wider impact on the health and well-being of society.

In our 21st year of devolution, timid tinkering will only entrench the societal divides which are so prevalent in our communities.

As we build a movement to capture the moment, we need to ask the most searching of questions to understand the challenges we face.

Levelling up to give everyone a leg up go hand in hand – but which toolbox do we open? This debate is long overdue and in the words of our late friend Steffan Lewis, we should make the solution more memorable than the problem.

Nowhere is this truer than in the case of our education system.

The new curriculum requires a step-change in everyone’s approach. Pupils will need to think for themselves, a culture of creative thinking will be encouraged, and teachers must be supported.

The evidence of a strong link between human capital and economic development is bad news for Wales.  Because what we may have thought was a source of strength – given the historic importance placed on education – is actually a source of weakness.

Wales is 10% behind Scotland when it comes to the proportion of the adult population with an NVQ Level 4 qualification – 34% versus 44%.  That’s equivalent to 180,000 extra people with a NVQ Level 4 qualification.

There is, therefore, a strong case that low skills and under-investment in education is a major contributory factor in poor economic performance.

 

Progressive

So what will be those memorable solutions?

We have two major sources of potential future growth.  The diaspora promising more immediate returns if we can attract them back, and the next and current generations of workers offering more medium and longer-term returns on investment.

The question is how can you fund the latter without disincentivising the former?

£300 million would represent around a 10% increase in the education budget – a significant rise – and a 1p rise in income tax would deliver that.

But then why work or set up business in Cardiff, when you can do the same in Bristol at a lower rate of tax for yourself and your employees?

So, we need to get a little creative.

We could, for example, scrap business rates and council Tax – both badly designed and unfair levies in their own ways, and replace them with a new Single Property Tax – allowing us to cut income tax while investing in education.

It would be socially progressive and would provide a financial incentive for young workers to return or stay in Wales, and for entrepreneurs to base their businesses here.

The seeds of our disappointments in Wales have been in our eagerness to do a little bit of everything at the expense of concentrating on the major challenges.

By acting fast and smart we can build a strong future by investing in the skills of the present.

The new Wales cannot be built with the old tools and the old ideas. To build it, we will have to be bold.

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Simon Gruffyddjr humphrysAlwyn J EvansIfan DafisWalter Hunt Recent comment authors
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Mcollins
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Mcollins

Some good discussion points and refreshing that someone from the left sees the benefits of making Wales a lower tax nation.

How would the single property tax work? Would it be similar to the land value tax? I imagine the Welsh Land Transaction Tax would also be merged into this?

Plain citizen
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Plain citizen

Good ideas.

vicky moller
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vicky moller

reducing taxes alone not enough. Great to think radical. Business rates are so unjustified wonder it they are legal.. They are not based on profit and deliver no services. They contribute to the destruction of town centres as social and business hubs. If business rates were spent in the town that paid them on town services agreed by the businesses/people of the town they would make sense. If based on area not proximity to centre they would not favour out of town and vast footprint supermarkets. So much that is perverse could be corrected with common sense. Lets have a… Read more »

Jonesy
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Jonesy

Cardiff – what about the rest of Wales Adam? How do you stop the draining of human resources and brains to Cardiff and over Offa’s Dyke? take a look at for example Coleg Ceredigion’s list of courses. the conclusion? Abysmal – is this what further education has to offer those who do not want to waste time and money on a degree? Most of the courses have been moved to Carmarthen or Graig Llanelli campus which means hours of travel for kids who cannot drive or cannot afford a car. If educational and vocational courses of any value are not… Read more »

jr humphrys
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jr humphrys

He’s not in power yet.

Eos Pengwern
Guest

This is the best thinking coming out of Plaid Cymru that I’ve seen for a long time. I’d been wondering what had happened to the bold, innovative Adam Price we saw during the leadership campaign, who seemed to be stealing Gwlad ideas left, right and centre and held forth the prospect of making Wales a much more business-friendly country with a flourishing economy. But as soon as he got elected, he seemed to ‘go native’ and become the continuity Leanne Wood. If he’s now rediscovered his ability to think creatively then that’s very welcome indeed. There’s much to applaud here;… Read more »

Walter Hunt
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Walter Hunt

1). All businesses that trade across currency zones face currency fluctuations which hit profits. A state backed currency exchange which offset this would attract inward investment and pay for itself because higher profits equal higher tax revenues. 2). Promoting networking of Welsh businesses by tax breaks for Welsh business to Welsh business transactions and 3) encouraging promotion of “Made in Wales” products by requiring businesses above a certain size to report and advertise at points of sales what % of their turnover these comprise. 4). The creation of a USP for every town (look how well it worked for Hay-on-Wye).

Alwyn J Evans
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Alwyn J Evans

It’s no longer the economy, it hasn’t been since 2008. Unfortunately for Adam Price, his call for a different way, with very few actual ideas for radical change, may about to be subsumed by a real radical and visionary at the heart of Boris Johnsons government. There is every possibility that Adams attempts to create ripples in the bucket will be swept away by the tsunami of change coming from Dominic Cummimgs. “You were the future, once” may be a more apt political trope for Adam Price.

jr humphrys
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jr humphrys

Tsunami like “Give a bob for big ben to bong?”

Alwyn J Evans
Guest
Alwyn J Evans

That’s part of it, yes.

jr humphrys
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jr humphrys

Destroyers are rarely builders.

Alwyn J Evans
Guest
Alwyn J Evans

That’s a completely invalid statement.

https://dominiccummings.com/

His blog has a lot of articles. If you can get past the “he’s the nutjob brexit tory bloke” you may find a radical thinker who has brought together a lot of supporting evidence from experts on what is achievable for systems of governance and how that change can be created.

jr humphrys
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jr humphrys

We’ll see.

Simon Gruffydd
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Simon Gruffydd

I’m all in favour of an independent Wales on par with the Isle of Man, Iceland or the Faroes (which, by the way, are more independent and prosperous than Republic of Ireland, being outside the EU). But independence is not a silver bullet for prosperity. It’s the money supply that lies at the heart of our rot – or salvation. Most people, including politicians, don’t even know where money comes from, let alone that the nature of the money system that is purposely designed to keep wealth producing people (workers) poor and the wealth extracting “1%” in excess. The fact… Read more »

jr humphrys
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jr humphrys

Okay, write an article with a few solutions, then. I’m sure Adam is open to ideas. First, on how Iceland manages it’s trade agreements with the European union could be a start. Like you, I would be delighted to be a “Jersey”? But doesn’t the demographic have something to do with it. You mention tiny countries, then throw in Eire. Okay, then : England 56 miliion. Cymru 3.1 million. Which country can move faster with A.I.?

jr humphrys
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jr humphrys

Another estimate has Englands population at over 66 million. Big countries, big problems.

Ifan Dafis
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Ifan Dafis

“It’s money creation stupid!”……… Another episode of the Adam Price “Big on rhetoric, Short on detail” show. As mentioned below by Simon Gruffydd, the “toolbox you need to open” is the one labelled “Money Creation”……….Without addressing that issue, all and everything else really is “timid tinkering” for, without addressing that issue, all and any wealth created will eventually flow into the hands of the money creators……Look up the Bradbury pound and if you REALLY wish to do good for the people of Wales, and indeed the rest of the UK as things stand, talk about the subject of money creation……..

Simon Gruffydd
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Simon Gruffydd

People (including politicians) need to start asking questions like: How is it that we collectively owe more money than even exists? Why have assets like land and houses exploded in price while wages have stagnated? (It’s nothing to do with supply and demand) Why has the government contribution to the money supply (legal tender) shrunk from 60% fifty years ago to less than 3% today? Why are governments in debt, at all? Where does the bulk of the money come from if not the government? This 12 year old girl knows more about the rotten money system than most politicians:… Read more »