Page last updated at 16:56 GMT, Thursday, 3 November 2011

Silk commission debate part one

The Silk Commission provides a "coherent opportunity" to see how devolution is working in Wales 12 years on, Welsh Secretary Cheryl Gillan has said.

The commission - chaired by Paul Silk, a former clerk to the Welsh assembly and the House of Commons - is examining how the Welsh government is funded, looking at whether it should take further responsibility for raising the money it spends.

This could mean the Welsh Assembly is given more powers to levy some taxes, such as rubbish dumping costs, air passenger duty on flights and stamp duty when buying homes, although it would not be limited to those taxes.

Opening a Commons debate on the commission on 3 November 2011, Mrs Gillan told MPs she believed the current system - under which the Welsh government can only spend what it receives through an annual block grant from the UK Treasury - did not provide enough accountability for Assembly Members at Cardiff Bay.

She said greater devolution could make the Welsh government more careful when it spends taxpayers' cash.

Mrs Gillan added: "It is surely better for the devolved institution to be accountable to the people of Wales not just for decisions on public spending in Wales, but by being responsible for raising some of the money needed to pay for those decisions."

Shadow Welsh secretary Peter Hain expressed fears that the commission would be used as a way to cut funding to Wales, telling MPs he was "deeply suspicious of the real Tory agenda" behind the review.

He said he was open to the idea of Wales raising some of the money it spends but "it must not be at the expense of a needs-based settlement which is vital for Wales".

His concerns were echoed by another Labour MP, Huw Irranca-Davies, who demanded that any changes to the current arrangements should not financially disadvantage Wales.

Mrs Gillan refused to "tie the Silk Commission's hands" but said it was "absolutely far from my motivation" to create a settlement which could leave Wales worse off.

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