Welsh Devolution @20

Newgate’s Glesni Euros shares her reflections on the 20th anniversary of the Welsh Devolution Referendum.

Twenty years ago today, in a referendum which would dramatically change the course of politics in Wales, the Welsh public narrowly voted (by just 50.3%) in favour of the creation of a Welsh Assembly, or ‘Cynulliad’ in Welsh.

A referendum on devolution was nothing new. In 1979, the Welsh electorate had voted against devolving powers to Wales by a majority of four to one. But the 1997 referendum on both Welsh and Scottish devolution was a Labour manifesto pledge in the run up to that year’s general election, which the party went on to win. Sticking to that promise wasn’t plain sailing though – as emphasised by a recent admission from former Labour Prime Minister Tony Blair. So big was the opposition within Labour ranks to the prospect of devolution that Blair had to “steamroller” through the referendum pledge.

Wales Says YesSince the vote on September 18 1997, the Welsh Assembly’s power and relevance have grown. When it was established, the Assembly was limited in what it could achieve. It was initially responsible for certain policy areas (such as health and the Welsh language). Unlike the Scottish Parliament, which had tax varying and law-making powers, the Assembly was only allowed to create new laws when authorised by the UK Parliament. However, with the passing of the Government of Wales Act 2006, the Assembly was able to gradually gain more law-making powers in the devolved areas. Then, in another referendum in 2011, all but one of Wales’ 22 local authorities voted ‘yes’ to the Assembly gaining full legislative powers in the policy areas for which it was responsible.

Over the course of two decades, the public policy landscape in Wales has diverged considerably in Wales – most notably in education, health and economic development. Certain Assembly enactments are well-known to the public. The smoking ban came into force in Wales in April 2007, second to Scotland but ahead of England in July of that year.  In 2011, Wales led the way as the first UK nation to introduce a compulsory charge for plastic, single-use carrier bags. More recently, Wales has been the first to take a major step with regards to organ donation policy. Rather than asking for citizens to opt-in to become organ donors, Wales now has an opt-out policy. This, politicians hope, will increase the numbers of those on the organ donor register.

Taking note of these public policy changes, though, hasn’t always been on the agenda for UK businesses. Indeed, with the construction of HS2 on its way amidst talk of establishing a Northern Powerhouse to counter Britain’s overheated capital, businesses are often slow to react to policy developments on the other side of Offa’s Dyke. They fail to grasp the opportunities to shape and inform a distinctively “Welsh” policy strategy.

And now further changes are on the horizon. Since June 23 2016, an enormous challenge has emerged for devolution in Wales – Brexit. The Welsh and UK governments do not see eye to eye on this key issue. It’s true that the public in both England and Wales voted for Brexit in last year’s seismic referendum and, similarly, both nations’ leaders had originally belonged to the Remain camp. Yet there is a marked difference between Welsh First Minister Carwyn Jones and Prime Minister Theresa May’s current Brexit stance. For the Welsh Government, securing unfettered access to the Single Market is at the heart of its agenda. In contrast, Theresa May advocates a harder Brexit, such as wanting to leave both the Customs Union and Single Market, as well as regaining full control over its borders.

Then there’s the big question of post-Brexit devolution settlements. It is the Welsh Government’s view that responsibilities for devolved policy areas such as agriculture and the environment – which have a strong EU legislative framework – should continue to lie with the devolved nations following Brexit. But the UK Government thinks otherwise. According to ministers in Westminster, new UK frameworks will be needed in certain policy areas, where powers will have been returned to Britain from the EU. In July, Carwyn Jones described the European Union (Withdrawal) Bill as a “naked power grab” by UK Government.

The Welsh Assembly has left its mark across both Welsh and UK politics; there is no denying that it is now an important part of our constitutional fabric. But as question marks remain about the form, flexibility and future of devolution in Wales in light of Brexit, it is now more important than ever that UK businesses take note of key policy changes in Wales. The devolution of further powers to the Assembly, including the ability to vary income tax rates, can only mean that businesses must engage constructively with the Welsh Government, as well as Westminster, on policy issues. Judging how and when to do so could contribute to the growth and success of businesses in a nation whose Assembly continues to evolve – twenty years on from its inception.