(Title Image: BBC Wales)

The draft Welsh budget for 2019-20 was tabled at the Senedd this afternoon by the Finance Secretary, Mark Drakeford (Lab, Cardiff West)

The full details will become clearer on October 23rd. For the time being, only the general spending, borrowing and tax plans have been revealed alongside a few other spending announcements.

If all goes according to the timetable, the draft budget will be put to a vote by AMs in December and the final version of the budget will be approved in January 2019.

This year’s budget is the second of the two-year deal agreed with Plaid Cymru last year, so its passage through the Senedd is largely a formality.

Spending & Borrowing Plans

The full draft budget narrative is available here (pdf).

In cash terms, there’ve been modest cuts to local government and the Welsh Government’s own running costs. Other than that, the numbers are some of the best I’ve seen for a while.

There’s been a big boost in capital spending in the economy & transport department, though in real terms (once inflation is taken into account)there’ve actually been cuts in capital spending to some departments.

In terms of borrowing, the Welsh Government intent to borrow £250million in 2019-20 and 2020-21 for capital spending. The expected interest on this is around £3.2million for 2019-20.

Some of the specific announcements made by the Finance Secretary this afternoon include:

Charitable relief will be removed from private schools and private hospitals, making them liable to the same business rates as state schools and hospitals.

Care leavers will be exempt from paying council tax until they’re aged 25.

A predicted £43million cut to council budgets has been reduced to £15million; full details on the local government settlement are forthcoming.

An additional £20million will be given to councils as part of a road repair programme resulting from the harsh 2018 winter.

A £12.5million package to address child poverty, including an expansion of the discretionary assistance fund.

Devolved Tax Plans

Plans to reduce the amount of business rates avoidance, following a public consultation, will be revealed on October 16th. Business rates are worth around £1billion a year to the Welsh Treasury.

Landfill disposal tax will increase in line with inflation. It’s expected to raise £40million for 2019-20. Here are the proposed new rates:

Land transaction tax (formerly known as stamp duty) will remain unchanged, unless further changes in England are outlined by the UK Chancellor in the forthcoming UK budget. It’s expected to raise £285million in 2019-20. These are the presumed rates based on last year’s figures:

For the first time ever, from April 2019 Wales will also be able to vary income tax up or down by 10%.

Sticking to Labour’s 2016 manifesto commitment, the Finance Secretary ruled out any changes to income tax, using the excuse that it’s in order to allow the new arrangements to bed in. The Welsh rate of income tax is expected to contribute just under £2.1billion towards the Welsh budget.