, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Wow, okay. [Laughter.] Thank you so much. There will be a transcript available for you to check for accuracy, but thanks again for your time. And we'll take a short break now to reset the room. Thank you.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
We'll let you get off to bed. There we are.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Thank you very much, and thank you so much for your attendance this morning. It's always interesting to have you here and to go through your analysis. Thank you very much to Professor David Miles from the other side of the world as well this morning. Thank…
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Thanks for that diversion. Sorry, it was just interesting to query that. Back to Sam.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
There may have been. Okay. Sorry, you were about to say something, Richard.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Has any analysis been done on the border with Northern Ireland and the Republic of Ireland? Because, obviously, there are two different tax regimes there as well. Just out of interest.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Sorry, do you do much analysis or forecasting around that behavioural aspect of taxation—so, cross-border behaviour, maybe? Because it's something that we as a committee are interested in, especially with Welsh rates of income tax, compared to maybe Scotland…
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Okay. Thank you.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Right. So, otherwise, you try and smooth out the curve, and, if they happen, they're nearly a bonus, in effect, in income, rather than trying to forecast that volatility.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Because it's predicting one event sometime in the future.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
With that aspect, I'm just interested in how you would go about—. How good is your data gathering, I suppose, in knowing these events, because they're quite significant purchasing events? How is your data gathering able to inform your forecast, or is it just…
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
I'll bring Sam in now. Thank you.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Thank you very much. Mike Hedges. There we are, thank you.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
In social care, for example.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
But then would that assume that those rises were passed on to the third sector providing those services, through into local government and then onto those contracts, rather than it going into, potentially, those departments and being used in different ways?
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Just thinking back to the NIC contributions and that make-up of the Welsh economy, with a significant part in the public sector, then you've got a real chunk of the economy where you've got the third sector heavily involved, and that impact of national…
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Tom.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Mike.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
I think it'll be of great interest to this committee as well, going forward. Thank you. I'll move on now to Mike Hedges. Mike, I'll bring you in.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
And is that analysis work that you've decided to do yourselves, or is that something that's been commissioned by either Government or somebody else?
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
And is that data freely available to you? Are you able to—? Do you have that granularity?
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
What impact does the freezing of thresholds to 2029 have on that? Because obviously that increases the receipts, but then has more of a negative effect on people in lower income sectors, similar to what Sam was talking about earlier.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Okay.
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
And that medium term is 2028-29, or—?
, Finance Committee
Welsh Government Draft Budget 2025-26: Evidence session 2
Is it public sector spending? Or what's having the biggest effect there to mitigate, I suppose, what we've just been talking about?
