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Wales Act 2014

Section 22: Budgetary procedures

193.Section 22 gives the Assembly the competence to legislate for its own budgetary procedures by amending Schedule 7 to GOWA 2006 (which lists the subjects about which the Assembly can legislate).

194.Subsection (2) inserts a new subject in paragraph 13 (National Assembly of Wales) of Part 1 of Schedule 7, by providing that budgetary procedures are within the Assembly’s legislative competence. The new subject defines budgetary procedures as procedures for a financial year relating to any one of three things. Firstly, the authorisation of the amount of resources which may be used or retained either by relevant persons or pursuant to a relevant enactment. Secondly, the authorisation of the amounts which may be paid out of the Welsh Consolidated Fund to relevant persons or pursuant to a relevant enactment. “Relevant persons” is defined as including the Assembly Commission and the Welsh Ministers. “Relevant enactment” is defined as an enactment which provides for payment out of the Welsh Consolidated Fund. Thirdly, budgetary procedures relate to scrutiny (by the Assembly) of use of these amounts, or of the exercise of borrowing powers by the Welsh Ministers.

195.This would enable the Assembly to legislate in relation to procedures for scrutinising and setting the annual budget of Welsh Ministers, other relevant persons and any other body receiving payments from the Welsh Consolidated Fund by virtue of an enactment (either Parliamentary or Assembly), and for example would allow the Assembly to pass an annual Finance Act in place of the current annual budget motion. As the Assembly also has competence for devolved taxes, these procedures could include the determination of the tax rates in relation to such taxes, tax receipt forecasts, variances, borrowing for current and capital purposes and amounts for repaying borrowing in addition to authorising how much “relevant persons” may spend. As described in paragraph 60 of these notes, the Welsh rates of income tax (the relevant provisions for which are subject to a referendum) must be set by an Assembly resolution. It is for the Assembly to decide whether such a resolution should be considered in the context of its budgetary procedures.

196.In order to legislate for new budgetary procedures, the Assembly will need to modify various sections in Part 5 of GOWA 2006 which refer to the current budget motion process.

197.Subsection (3) amends paragraph 5 of Part 2 of Schedule 7 (general restrictions on competence) to allow the Assembly to modify the sections of GOWA 2006 listed in that paragraph. Subsection (3)(a) includes in this list section 120(2) and sections 125 to 128. Subsection (3)(b) includes section 119, but only in so far as any modification relates to the estimated payments for a financial year into the Welsh Consolidated Fund or to the Welsh Ministers, the First Minister or the Counsel General. In addition, the Assembly may need to make limited adjustments to other provision in Part 5, and subsection (3) therefore inserts a new sub-paragraph (4A) into paragraph 5 enabling an Act of the Assembly to make amendments to other sections in Part 5 or section 159 of GOWA 2006 provided they are (a) incidental to, or consequential on, provisions in an Assembly Act relating to budgetary procedures or devolved taxes, and (b) consented to by the Secretary of State.

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