Welsh Affairs

Debate between Angus Brendan MacNeil and Glyn Davies

Thursday 6th March 2014 Commons Chamber

[Glyn Davies]

I thank my hon. Friend for his contribution. We worked together on the sort of development that not just transformed mid-Wales, but brought north and south Wales closer together. That is a point I wanted to make in this debate.

Wales should be developed not just as an economic unit, because it is important to develop it as a political entity. That has probably always happened throughout history, but it has certainly gathered pace in recent decades. The Secretary of State has taken delivery of the Silk commission’s report, which came in two parts. There will be other opportunities to talk about it, but it makes two particularly important recommendations.

The first part of the report recommends that significant income tax powers should be devolved to the National Assembly for Wales. When the commission was set up, its main purpose in my opinion, and I think in the Government’s opinion, was to give the Assembly financial accountability so that decisions were made on raising money and spending it. The debate would then be the same as in every other democratic body imaginable and include raising money. Unless they accept that responsibility for raising the money they spend, the Welsh Government and the Welsh Assembly will not become a real governing body or a proper Parliament. That is hugely important.

[Mr MacNeil]

Surely an issue that is allied to what the hon. Gentleman is saying about tax-raising powers is nurturing and growing the economy. I would argue further that the Republic of Ireland was behind Wales economically 100 years ago, but it has leapfrogged Wales and Scotland. The reason is that the Republic of Ireland had the power not just to tax and spend, but to see which parts of its economy it wanted to nurture and grow. Wales will not be able to do that until it has powers equivalent to those in the Isle of Man, the Republic of Ireland, Denmark and so on. Essentially, it needs the power to be at the helm and to make its own decisions for its own people.

[Glyn Davies]

I thank the hon. Gentleman for his intervention. I want the Welsh Government to become a proper Government with sharp debate so that debates about the budget engage Welsh people. They would take much more interest in a Welsh Government with tax-raising powers.

The First Minister of Wales has put some blocks in the way, but I sense that after the result of the Scottish referendum those blocks may be resolved. There are three parties in Wales that are generally supportive of this principle, but Labour seems instinctively not to be. I do not know what the shadow Secretary of State’s view is, but I suspect that he is not greatly in favour of devolving income tax powers to the Assembly because of the responsibility it carries. I would plead with him to change his opinion. Let us see devolution develop as it should. This is the next obvious step in the process of devolution, and we must get a grip on that.

In my last 36 seconds—I would have liked to have had20 minutes—I want to touch on a cross-border issue that I have raised before. We have to stop devolution damaging the interests of Wales. We talk about education and health, but the issue that is particularly relevant to me is the cross-border road schemes that would go ahead without devolution but are now unable to go ahead because England is not willing to commit money to its half of such schemes as there is no economic benefit for it. We have to develop a relationship with the Department for Transport to stop that damaging Wales, as it currently does.

The Economy

Debate between Angus Brendan MacNeil and Glyn Davies

Tuesday 6th December 2011 Commons Chamber

[Glyn Davies (Montgomeryshire) (Con)]

I shall take a Welsh perspective, and to some extent a constituency perspective. Debt hangover, deficit reduction and the problems facing the eurozone have an impact in Wales, just as they do in the rest of Britain, but some issues are specific to Wales and I want to touch on them.

Much of the management of the Welsh economy is devolved, but not completely; for example, policies on tax rates and international investment are still determined at Westminster. That inevitably means that a close working relationship between the Governments in Cardiff Bay and at Westminster is crucial. Without one, there is the potential for damage. Enterprise zones are an important aspect of the Government’s policy for dealing with the economic problems of England. I do not want to blame anyone, but in Wales they are still incredibly ill defined and the process is slow, so we need a much closer relationship between Ministers in the Assembly Government and Ministers at Westminster.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

The hon. Gentleman said that most economic control was devolved to Wales. Would he be as comfortable with a relationship between London and Europe as there is currently between Cardiff and London—with most powers held in Europe and London, despite the economy of Wales being devolved?

[Glyn Davies]

I thank the hon. Gentleman, although I am not absolutely certain that I picked up his point. Governments and institutions have to work as closely together as possible for the benefit of the people they all serve.

First, inward investment has historically been strong in Wales. Yesterday the Secretary of State for Business, Innovation and Skills told the Welsh Affairs Committee that Wales was doing relatively badly. I think Wales is doing very badly indeed; last year only 3% of inward investment in the UK went to Wales. In the two previous years the proportion was 6%, which is about what one would expect given the population of each country. In the days when Lord Walker was Secretary of State for Wales, it was 20% for two or three years in a row. There was a major focus on Welsh links to the most successful parts of Europe, such as Baden-Württemberg, Stuttgart, Barcelona and Lombardy. There was a strong relationship with Japan, which in those days was aggressively developing its economy throughout the world. A lot of investment was going to Wales, and we need that sort of advantage. When I became a Member of this House I had been a Member of the Welsh Assembly for eight years, and I want the relationship between the two institutions to work as well as possible. On inward investment the working relationship has not been as close as it should be, and we need to change that.

Secondly, I want to touch on cross-border issues, in particular their impact on my constituency of Montgomeryshire. Again, it is a question of making devolution work for the people. There is a real problem in terms of capital investment in Wales. A consequence of the autumn statement is that over the next three years another £216 million will go to Wales for capital projects, but projects on the border will not be considered, because the arrangements following devolution mean that they cannot be. For my constituency and for the whole of mid-Wales, industrial development depends on access to the west midlands market and the motorway network. One of the biggest impediments is the stretch of the border between Welshpool and Shrewsbury. A road project there has high priority for the Welsh Government and would almost certainly have gone ahead, but the total cost is around £30 million, with a significant proportion—about £5 million—over the border in England. Although it has huge priority in Wales it is given almost no priority at all on the English side. That project has been sitting around for ages and is not going ahead, yet it should really be a priority. I could give three or four similar examples.