European Union (Withdrawal) Bill

(Limited Text - Ministerial Extracts only)

Committee: 11th sitting (Hansard): House of Lords
Wednesday 28th March 2018 Lords Chamber

[Lord Griffiths of Burry Port]

I was hoping that that was an intervention—I am better prepared for interventions than I was last time.

I simply hope that, when all is said and done, the fact that this is about money—even if the guarantees and figures cannot be given in a debate such as this—will indicate the desperate need felt in Wales for some support and encouragement. There must be a promissory note for adequate support that will be met once we are no longer in Europe for the activities that up to now Europe has helped us with so generously.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, I thank the noble Lord, Lord Wigley, for tabling these amendments and all who have participated in what has been a free-wheeling, free-ranging debate covering an awful lot of important areas, some which I perhaps in all fairness could not have anticipated when I read the amendments.

The noble Lord, Lord Griffiths of Burry Port, is absolutely right that in debating something geared specifically to Wales we should recognise the enormous contributions made by Lord Richard and Lord Crickhowell, both of whom sadly died recently. Sometimes in similar ways but in differing ways in other respects, both made enormous contributions in Wales and to devolution. Lord Richard is certainly massively missed. He made an outstanding contribution on the Richard commission in relation to devolution but in so many other ways in public life as well.

I will first turn to the amendments and then try to do justice to the many wide-ranging points made during the debate. The noble Lord, Lord Wigley, was described as “terrier-like” and as getting the last bit of marrow out of the bone. As someone who has often broken bread with him, I thought that conjured up an extraordinary vision of him. For many years, he has certainly fought hard for many issues in public life, not least for Welsh principles and rights, both here, in the Commons and in the National Assembly for Wales. I think that is acknowledged across the political divide and by people with no politics at all. He continues to make an extraordinary contribution.

The amendments would require the United Kingdom Government to produce a report outlining how EU funding provided to Wales will be replaced once we leave the EU. They would mean that the entire Bill could not be brought into force pending the publication of such a report.

While I understand the desire for as much clarity as possible—I shall say something about cohesion funding shortly—I do not consider such a step necessary in view of the considerable funding assurances the Government have already made to all parts of the United Kingdom. I recognise that there is an issue here that goes broader than Wales. There are certainly issues relating to Cumbria, as has been mentioned during the debate, Cornwall, Merseyside, Scotland and so on—this affects many parts of the United Kingdom, although the amendments are for understandable reasons addressed to the needs of Wales, which I can strongly identify with.

The agreed implementation period to the end of 2020 will see the UK participate in 2014 to 2020 EU funding programmes until their closure. In the case of some of those projects, that will mean the end of 2023. It will not be beyond 2023, but it could mean funding for those programmes that remain open during that funding programme until the end of 2023. The projects would receive their full allocation of EU funding during that period—that is an agreed position as things stand.

This approach ensures that projects are not disrupted and no community misses out. The noble Baroness, Lady Humphreys, was there at the start of the Assembly as were the noble Lord, Lord Wigley and I, and saw the benefit of such funding—I fully recognise many of the examples that she gave. In the area that I represented in west Wales, there were massive benefits. No community would miss out. British businesses and potential investors have certainty and stability up to the end of projects running to 2023.

In the longer term, the Government have further committed to maintain cash farm funding until the end of this Parliament, taking us beyond 2020, which provides the sector with more certainty than in any other part of the EU as things stand. The Government will also create a UK shared prosperity fund to reduce inequalities between communities across the United Kingdom and deliver sustainable, inclusive growth. The Government intend to consult on the design of this United Kingdom-wide fund during 2018. That will of course, quite rightly, mean engagement with the Welsh Assembly through the Welsh Government and, similarly, the Scottish Parliament through the Scottish Government and with others who would expect to be consulted in that process.

[Lord Liddle]

Can the Minister tell us anything about the timing of consultation papers on the shared prosperity fund? When are they likely to appear? Particularly in relation to the debate on Brexit, are we likely to see what is proposed before the final decisions that we have to make at the end of this year?

[Lord Bourne of Aberystwyth]

The noble Lord makes a fair point. I do not know the specific answer, but I will cover it in a letter to all Peers who have participated in the debate on these amendments, and place a copy in the Library.

[Lord Thomas of Gresford]

Perhaps the Minister can answer this question. Is the UK prosperity fund—which I think was in the last Conservative manifesto—intended to be administered or distributed on the basis of need or a population count?

[Lord Bourne of Aberystwyth]

My Lords, it certainly was in our last manifesto. As I have just indicated, it talks about reducing inequalities, so the noble Lord has that comfort. Again, I will ensure that any points not dealt with in my answers will be covered in a letter to all Peers who have participated on these amendments, a copy of which will be placed in the Library.

The noble Lord, Lord Wigley, made some points about cohesion funding, which dates back to 2000. I remember when the noble Lord was leader of the opposition in the Assembly and I was leader of the Welsh Conservatives—I later became leader of the opposition. I too went out to Europe and fought for this with Michel Barnier. I also remember the struggles that we had with the Treasury; that was accurately reflected. I agree with the noble Lord, Lord Thomas, on this point, which the noble Lord, Lord Wigley, made in the Assembly on many occasions. Such funding was not a badge of pride: it was coming to Wales because of the poverty that was experienced in west Wales and the valleys. It was not limited to Wales: Cornwall, Merseyside and so on were also involved. This was something that we did not really want to qualify for. There will be another round of funding from 2021 to 2027 and I will look at how that pans out. It is not guaranteed, even in European terms, that Wales will qualify. We were somewhat surprised in the last round of funding—it was very marginal—that Wales just managed to qualify. In one sense we were pleased, because to just qualify rather than just miss was welcome. We have to remember that there is no automatic right to it. It is based on 75% of average prosperity throughout the European Union.

There were some free-ranging points made about the referendum campaign—I remember the campaign in Wales as a campaigner for remain—but I will focus on the parts of the debate that were more central to the amendment and the legislation. First, however, I will touch on some of the funding that is coming to Wales. As a Welsh Office Minister, I know that we are participating very much in mid-Wales growth deals, north Wales growth deals and city deals. Stuff is going on which is helping projects in Wales now and engaging with the NFU, the FUW, the CLA and so on. Many things are happening in Wales that I am sure noble Lords across the Chamber would be pleased about.

Points were made about the Barnett formula. Lord Richard would have had much to say on this and we come back to it on many occasions. However, the issue exists independently of Europe and it is not made better or worse by our position in Europe. It does need addressing. In fairness, as part of the coalition in the previous Parliament, we ensured that the formula was ameliorated by the application of the Barnett floor, which benefited Wales. That said, I recognise the points about the historic position of Wales, unlike Scotland which benefits from the Barnett formula. I will leave that for another day, if I may.

The noble Baroness, Lady Humphreys, was there at the start and very much engaged with ensuring that we got the benefits of Objective 1 into Wales. In parenthesis, the giving of taxation powers to Wales, which was part of the coalition Government and the Silk commission and is now in process, should help to incentivise growth in Wales and is part of the added powers that have been given to the National Assembly for Wales. We should not fail to recognise that a lot of these issues are things that the National Assembly now can, and I have no doubt will, ameliorate.

The noble Lord, Lord Roberts, made a valid point about Welsh agriculture being much dependent on agricultural funding. I hope he takes comfort from what I have said about the agricultural budget up to the end of the Parliament. He is right that we have to focus on it. In fairness, it is not just a Welsh issue but, as he rightly recognises, it is central to a lot of Welsh life and many areas and close to the hearts of people in Wales.

The noble Lord, Lord Liddle, mentioned the Cumbrian situation and touched on federal issues. I can promise that just as I would take a call from Sadiq Khan, I would take a call from the noble Lord. If he wants to ring on any issues, I would be very keen to do that. I think Wigton is extremely important.

The noble Lord, Lord Adonis, referred appositely and correctly to the weak voice of England in our structures. I think that the noble Lord, Lord Foulkes, by inference touched on the incomplete part of the jigsaw in that we do not have regional voices for England, or not in the same way that exist in Scotland, Northern Ireland and Wales.

I perhaps take issue with the noble Lord, Lord Adonis, about the unknown mayor of Birmingham. I think that would be a surprise to many people. Many people know that it is Andy Street, just as we all know Andy Burnham. I do not think it would be quite right to refer to them as colonial governors, either.

[Lord Adonis]

My Lords, I was referring to the then Leader of Birmingham City Council who is now also a Member of your Lordships’ House.

[Lord Bourne of Aberystwyth]

And a very able one. I take that qualification and thank the noble Lord for it.

It is also worth saying that there were attempts to extend regional government to England. I am sure we all remember the referendum in the north-east, which was pretty decisive. I accept that there are issues to address there. This Government have done more for city mayors than has been done for a long time in terms of devolved power and not just in the big cities of the UK. We have looked at other areas—Cambridgeshire, for example. However, there is incomplete work—including in Yorkshire, it is fair to say.

I agree with the noble Lord, Lord Foulkes, that the Falkirk Wheel is well worth visiting. I also agreed with him on other issues that he mentioned in relation to the unaddressed issues about government in our country—some points well made.

I thank the noble Lord, Lord Thomas of Gresford, for his contribution and agree that we fought for money for Wales. It was not a matter of pride, it was a matter of getting money that was needed. I agree that in many ways the money is still needed because of the relative poverty in Wales—sometimes a poverty that is not obvious. The grinding poverty that exists in the Valleys is obvious, but the poverty in the rural communities of north-west and south-west Wales is not necessarily as obvious.

I thank the noble Lord, Lord Griffiths of Burry Port, for his contribution and for re-focusing us on some of the issues that matter. He referred to the history of some of the devolution process in Wales—the 1997 referendum, the 2011 referendum and much work that was done in-between. He is right that there is a money issue. I do not think it is just a money issue; it is also an attitude issue that has existed prior to this Government and probably the previous Government. In short, I think it is ameliorated. There is an attitude of: “Let’s not forget Wales, let’s not forget Scotland”. It has become lot better; it is plugged in. That is not to say that we are there yet. It is not just a money issue, though money is important too.

The noble Lord mentioned the Barnett formula. A lot of good work has been done in the past by Gerry Holtham and the Holtham commission, but there are issues which remain to be addressed—that is no doubt true. He went on to talk about the consenting process, and I take it that he means the process referred to in Clause 11. I agree that this is a partnership and, in fairness, the Prime Minister is very much aware of that. She met the First Ministers of Wales and Scotland very recently, and I think progress was made. More work needs to be done and is being done. We are not there yet. I think that anyone who is fair minded would acknowledge that we have made considerable progress on this but, as I say, we are not there yet.

I appreciate that the noble Lord, Lord Wigley, may regard this as half a loaf—it is not everything he wants—but I am happy to talk to him between now and Report and to find answers to some of the questions put by the noble Lord, Lord Liddle, about the timing of this process. I hope that helps the noble Lord: I thank him for bringing this important issue to the House. I thank other noble Lords for their part in this. While the present team and I remain at the Wales Office, we are determined to ensure that Wales gets a fair deal. I am sure that applies to the Scottish and Northern Ireland teams in relation to Scotland and Northern Ireland. We have to ensure that all parts of the United Kingdom are taken care of in this. We do not want this to be x versus y: everybody has to be fairly dealt with. On the basis that I am happy to try to find more information for the noble Lord, Lord Wigley, and others, I hope that the noble Lord will withdraw his amendment.

[Lord Wigley]

I am very grateful to all noble Lords who have taken part in this debate, which was rather longer than I expected. Perhaps I set the wrong precedent in my own speech. I thank the noble Lords, Lord Liddle, Lord Roberts of Llandudno, Lord Adonis, the noble Baroness, Lady Humphreys, of course, as well as the noble Lords, Lord Foulkes, Lord Thomas of Gresford and Lord Griffiths of Burry Port, and the Minister, for their comments. I am grateful for the acknowledgment of the importance of the issue. In response to the noble Lord, Lord Cavendish, whose interventions I followed with interest, I recognise, as we all do, that other parts of the UK have specific needs which should be addressed as well. We need a mechanism to do that. In the context of the current round of European funding, on top of the CAP, there is a particular impact on Wales, which was what I wanted to highlight.

I suggest to the noble Lord, Lord Bourne, that, in the fullness of time and having thought a bit more about this and discussed it with his colleagues, the Government might be minded to bring forward a White Paper, or a publication of some sort, laying out how funding coming from Europe will be replaced. This would not be just for Wales but for other areas as well, and not just for the period from now until 2019 or 2021—whichever is the end of the transition period—but their ongoing intention after that. As the noble Lord, Lord Foulkes, said, the timing is important. I identify with the comments made about the late Lord Richard and the late Lord Crickhowell who, in their different ways, both made considerable contributions to Wales. I am sure that, if they were here today, they would be taking an active interest in these issues.

The noble Lord, Lord Bourne, knows enough about the feelings in the National Assembly about European funding to realise that this is a real issue that can make a difference, not just a political football. We can certainly argue about how the money is used and how it is used in Merseyside, south Yorkshire or Cornwall, where it is used in different ways, sometimes with better results. We need the resources because we are not going to get them elsewhere. They have to be replicated somehow. The question of trust has arisen in a number of contributions. Before the noble Lord, Lord Bourne, entered the Chamber there was another issue regarding money from the Treasury—the aggregated capital funding that Wales was accumulating in the National Assembly to avoid the wastage of year-end expenditure and put it into capital projects. That money was taken back by the Treasury on the basis that we had no right to aggregate money from other headings to fund capital projects. That is the sort of breakdown of trust that we are talking about, and we have to make sure that those attitudes are not exemplified in the ongoing period.

I hope that over the coming two or three weeks it will be possible to see whether a different formulation of this amendment can be tabled on Report, bringing in other parts of the United Kingdom and perhaps other parties. I invite the Front Benches of the various parties and individuals on the Cross Benches to consider whether that may be possible, and to do so with the positive intention of achieving a meaningful step forward as a result of the debates here that will help Wales and all other parts of the United Kingdom to find a way through the consequences of leaving the European Union. On that basis, I beg leave to withdraw the amendment.