Chamber and committees

There is nothing that I have seen that says that the new UK Government does not agree with that—our assumption is that it is, in principle, in agreement. It is all about how we get on with it. I have no intelligence that tells me otherwise or that there has been any shift away from that principle—it is our working assumption that there is agreement on that. I should say that I am not the person who has been closest to the dialogue with the new UK Government on some of the detail in this area, but we can follow up with the committee on what exchanges of correspondence there have been.

I will take that away to reassure myself that we are able to—

The tax strategy will be linked to the economic strategy in looking at all of that. We must make sure that those are linked, and the key reason for doing so is that there has to be coherence. Indeed, I have been meeting the Deputy First Minister to ensure that we can describe all of that and that our economic and tax strategies are all pointing in the same direction. That is the work that we have been doing.

You are right about that group—although it is actually meeting this month—but I would not want that point to be a signal that there has been a lack of activity. There has been a lot of activity on the recommendations that the working group made. As you are aware, the visitor levy and other things that emanated from the group have been taken forward in between its meetings.

There was significant interruption after the group last met, which I think was in April, as we had an election, a change of First Minister and all the engagement with COSLA. I meet COSLA at least once a week at the moment, and all the people who are in the joint working group are the folk who are in the room when I meet COSLA. It is fair to say that I probably meet them more than anyone else at the moment but, given my local government hat, that is understandable.

One key aspect of the fiscal framework, although it is not formally in place yet, is early engagement on the budget, and that has happened. Katie Hagmann and I have met on, I think, three or four occasions to talk about the budget. In fact, I have a note here that tells me that there have been three meetings on budget matters, with the fourth due this week, which I think is about right. We also have broader engagement on some of the important strategic issues.

There has been no lack of engagement. What is discussed and the outcome from that are probably more important than the forum in which that happens.

I will start with the easier bit, which is the progress that is being made on the principles of more flexibility and more financial powers. We are progressing those in the here and now. Fundamental council tax reform is harder and will take longer to do, so it is important to get on with some of the fiscal empowerment with more levers.

In part, the issue depends on whether we can build a degree of cross-party consensus about the ambition on council tax reform. We have been round the houses on what a fundamental replacement would look like. I would want to try to get a level of cross-party agreement on what the most important changes would be. If we could get to that stage by the end of the current parliamentary session, that would stand the next Parliament in better stead to make further progress on reform.

I do not think that that space is the joint working group, because it does a range of other things, such as looking at the visitor levy and all the detail around that. It is probably external to that. I guess that it is a case of trying to forge some discussions in this place that could perhaps go outwith the budget discussions, and looking at what opportunities exist. Given that we are going to be in a better place with multiyear budgets, is there a landing space for more significant reform to council tax, so that we could have some general agreement around the principle of it? That is easy to say and much harder to achieve, but, without it, it is difficult to see how we could move forward with significant reform.

I am keen to take the views of external stakeholders on that, and I know that you are also keen that there should be a bit of civic society involvement in the process. I am mindful of the fact that we could reach a position of saying that we think A, B and C, but the fact of the matter is that it might not garner enough political support in this place. I am keen to have some honest discussion about where a landing space might be, and I make an open invitation on that. I do not think that anyone would say that the council tax is perfect and that no important changes need to be made. If we take that as a starting point, we would need to consider what changes we could largely agree on in principle.

I am mindful that it takes a lot longer to do any—

I am mindful of how difficult big bangs can be, and the Welsh Labour Government experience of that should make us think about how we address the matter. There is a point about property values being 30-plus years out of date, but we must try to take people with us on this journey.

There are ways of moving forward. I stand to be corrected, but I think that a gradual change is being discussed in Wales and perhaps also in England. That would involve revaluation being done at the point of individual house sales, which would mean that it would be done in such a way that it had a soft landing over time, rather than as a big bang, which I think would scare the horses. The Welsh Labour Government has found that to be pretty difficult. It did one revaluation and it was looking at doing another, but I think that it has had significant pushback.

I am really wary of a big bang revaluation. Perhaps it is a case of getting public support to do something. From the point of view of fairness, there needs to be a gradual recognition of changes that have taken place over decades, but I would want to take people with me on that journey.

There was extensive consultation. Tom Arthur was asked about that issue on a number of occasions, and he addressed it at the time. I am happy to come back to the committee on whether or not—I think that there was very limited room for manoeuvre in relation to what could be done, given that VAT is a reserved issue. I cannot remember the detail of it, but I remember Tom Arthur addressing that point at the time.

I will come back to the committee on that. If consideration is being given to that, I am not aware of it. However, consideration might be being given to the issue somewhere else within Government, in relation to picking up the implementation issues around the levy.

Let me take that away. As with any levy, when something new is delivered, we always look at the implementation issues and what arises. I want to check on that before confirming one way or the other.