Harold Wilson famously opined “that a week is a long time in politics" and this has certainly been a very long one for all of those with an interest in our economic fortunes. Politically 22 years is a lifetime and so it was in October 2000, in the distant early days of devolution that I was involved, in a backroom role, as a special advisor to Mike German the economic development minister in Wales’s first coalition, alongside Paul Griffiths, now deputy leader of Monmouthshire Council and a certain Mark Drakeford, Wales’s First Minister.
The then partnership agreement, Putting Wales First, was published with a commitment that “we will rigorously pursue the scope for fiscal variations and other special measures which can exploit to the full the benefits of the regional state aid status given to West Wales and the Valleys.”
That process involved research, lobbying Brussels and London and learning from the Celtic Tiger Irish economy which had used tax policy so effectively to achieve record growth. Our efforts were in vain, at the time. UK Government Treasury policy has generally avoided geographically varied taxation as a policy tool in economic regeneration, apart from some experimentation in stamp duty exemptions for deprived areas and tax breaks to encourage investment in community investment finance and urban regeneration companies, until recent developments including enterprise zones and more expansive measures for freeports.
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