Oral Answers to Questions

Debate between Cheryl Gillan and Nia Griffith

Wednesday 27th June 2012 Commons Chamber

[Mrs Gillan]

There is huge concern among the businesses that I have talked to about any prospect of changes in the corporation tax rate across the border between England and Wales. As my hon. Friend will know, that relates to the purpose of the Silk commission, which I established and which is looking particularly at the areas of taxation and accountability. I hope that it will report later this year and we will be able to see its recommendations.

[Nia Griffith (Llanelli) (Lab)]

Hard-pressed households across Wales will certainly welcome the Chancellor’s latest U-turn on the proposed August increase in fuel duty, but with Office for National Statistics figures today showing that borrowing is rocketing because this Government have created a double-dip recession, will the Secretary of State speak up for struggling businesses in Wales and the 130,000 people still looking for work, and ask the Chancellor to do a U-turn on his economic plans?

[Mrs Gillan]

I welcome the new Opposition Front-Bench team. I also pay tribute to the right hon. Member for Neath (Mr Hain), who stepped down from the Front Bench last month and will be greatly missed. I welcomed the hon. Member for Pontypridd (Owen Smith), the shadow Secretary of State, during the Welsh Grand Committee, but I would like to do so again.

I say to the hon. Member for Llanelli (Nia Griffith) that, in addition to the support we have already announced, the decision that has been made to cut the fuel duty and scrap the previous Government’s fuel duty escalator, thus ensuring that fuel duty is frozen for 21 months, will help businesses and families in Wales. I am very surprised that she did not rise to the Dispatch Box to welcome that.

Oral Answers to Questions

Debate between Cheryl Gillan and Nia Griffith

Wednesday 25th April 2012 Commons Chamber

[Mrs Gillan]

As the right hon. Lady knows, I have constant discussions with the First Minister and the Welsh Government, as does the Under-Secretary. We have certainly discussed the links and there has been some discussion of Cardiff airport. I am pleased to say that I have invited the owners of the airport to meet me shortly, because I have been concerned about some of the reports I have heard in the press. We should be trying to talk Cardiff airport up, not down.

[Nia Griffith (Llanelli) (Lab)]

I certainly welcome the announcement by the Labour Welsh Government that Tata Steel will invest £800 million in Wales, but as the Secretary of State will know Tata bosses have repeatedly said that the prices they have to pay for energy in the UK are simply not competitive when compared with what industry pays elsewhere. What discussions has she had with the Energy Secretary and energy companies to secure a better deal on energy prices for heavy industry to provide an incentive for companies such as Tata to invest in Wales?

[Mrs Gillan]

One of the first things I did when I was appointed was visit Tata Steel, and I took the Business Secretary, Vince Cable, with me to discuss energy prices. The hon. Lady should know that all the Departments have been focused on the energy-intensive industries because we want to ensure that there are good manufacturing jobs in the future, not just in Wales but elsewhere in the UK. I have read the press release from the Welsh Government and the First Minister and he says that he was told at a meeting in India that £800 million has been approved over the next five years for investment in Tata Steel in Wales. I look forward to seeing the detail, because it seems to be a general announcement at this stage without too much detail attached to it.

Commission on Devolution in Wales

Debate between Cheryl Gillan and Nia Griffith

Thursday 3rd November 2011 Commons Chamber

[Nia Griffith (Llanelli) (Lab)]

We have had a long and full debate, and we have wandered over many subjects. We heard the hon. Member for Monmouth (David T. C. Davies) ensure that we heard a plurality of views. In his own completely inimitable style he told us that the Silk commission should have a remit to consider clawing back powers from the devolved Administration. That view must be unique to him.

[Mrs Gillan]

The Silk commission can look at the boundaries, and that means adjustments in either direction.

[Nia Griffith]

I thank the Secretary of State for that clarification.

My right hon. Friend the Member for Torfaen (Paul Murphy), a former Secretary of State for Wales, spoke with passion and conviction, standing up firmly for Wales and pointing out the deep mistrust of the current Government’s attitude to Wales, which is exemplified by the roughshod way in which Ministers are cutting the number of Welsh constituencies from 40 to 30. That fuels deep suspicions about what the Government’s motives are for setting up the Silk commission.

My hon. Friend the Member for Caerphilly (Mr David) stressed the need for a pragmatic approach that brings power nearer to the people but which does the best for the people of Wales. The hon. Member for Arfon (Hywel Williams) referred the Silk commission to his private Member’s Bills, the Bilingual Juries (Wales) Bill and the Jobcentre Plus (Wales) Bill. The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards), who had very little time, unfortunately, urged the Lib Dems to rebel on the constituency boundary issue.

My hon. Friend the Member for Ogmore (Huw Irranca-Davies) stressed the importance of this Parliament in taking decisions for the whole UK and urged that we move forward wisely, cautiously and with careful consideration of the issues. The hon. Member for Brecon and Radnorshire (Roger Williams) pointed out the importance of the Calman commission and stressed the excellent credentials of its members, and his words have been echoed by many hon. Members.

The hon. Member for Aberconwy (Guto Bebb)—I am not sure whether he is listening—stressed the importance of accountability and talked about practicalities. He spoke of the importance of treating businesses across the whole UK equally, but he then talked about different national insurance rates, so I am not sure quite where he was coming from.

The hon. Member for Vale of Glamorgan (Alun Cairns) talked about the need for stability and there being no further changes for a generation. He stressed the need for the Silk commission to consult effectively and to reach out to those who have not been effectively engaged before, pointing out concerns about the volatility of some taxes. The hon. Member for Epping Forest (Mrs Laing) reaffirmed her strong Unionist credentials and welcomed the commission, which she sees as an important step towards accountability.

My hon. Friend the Member for Pontypridd (Owen Smith) referred to the difficulties of having continual change and to the need to take a long-term view. He also stressed the need for economic stimulus, as set out in Labour’s five-point plan, and pointed out the measures that the Assembly Government are taking to implement elements of that in the areas for which they have responsibility, such as with the successor to the future jobs fund—the jobs growth fund—and with some investment in infrastructure, where they are able to do so.

The Opposition very much welcome the establishment of the Silk commission and the important tasks it has to do. Its first task is to review the case for the devolution of fiscal powers and to recommend ways in which the financial accountability of the Welsh Assembly could be improved. It will no doubt refer to the work done by the Holtham commission in its analysis of some of the possible ways of transferring revenue-raising mechanisms to Wales. It can examine the practicalities and the likely consequences of implementing any such measures. We should not underestimate the complexity of this issue or the dangers of people being, quite naturally, tempted to play the system by switching from one side of the border to the other. That issue has been mentioned by several hon. Members, particularly my right hon. Friend the Member for Delyn (Mr Hanson). Most importantly of all, the Silk commission will need to consult and take account of public opinion. It is vital that a move towards any change has the support and backing of the people of Wales.

We are disappointed that the Secretary of State has decided to make setting up the Silk commission a priority over tackling the challenge of delivering a fairer funding system for Wales—an issue that is specifically excluded from the commission’s remit. If her Government were really interested in delivering the best for the people of Wales, they would have made it a priority to introduce the so-called Barnett floor—a concept that was explored in the Holtham reports and adopted by Labour in our 2010 manifesto as the most practical and immediate step to protect funding to Wales.

[Nia Griffith]

As the hon. Gentleman will have heard my right hon. Friend the Member for Neath (Mr Hain) explain, we are at a tipping point. Until now, the Barnett formula has served the people of Wales well, but from this year onwards the balance will tip slightly in the other direction. Putting a floor in would offer additional protection and would be a straightforward measure. It could be implemented with the agreement of the Treasury and without having to go into the difficulties of trying to work out a needs-based analysis, which is much more complex but is something that we might wish to see in the long term. So, as Holtham identified, the Barnett formula has served Wales well up to now, but if nothing is done it will begin to disadvantage Wales. The whole point of putting in the Barnett floor is to prevent that from happening and to protect funding. The Holtham commission recommended moving to a needs-based analysis, and it produced evidence of how a needs-based funding system could be made to work in a way that is fair to all parts of the United Kingdom. In its second report, it demonstrated that a needs-based funding formula that is fair to Wales would deliver £117 to Wales for every £100 that is spent in England on devolved activities. It recognised, too, that moving to a needs-based formula would take time but, in the meantime, the Barnett floor could protect Welsh funding. Instead of making that a priority, as it could be implemented quite easily, the Secretary of State has set up a commission that specifically will not consider the issue of funding reform.

[Mrs Gillan]

It is being done bilaterally.

[Nia Griffith]

I hope very much indeed that that bilateral work is progressing quickly and effectively.

It is small wonder, given the Conservatives’ track record on devolution, that many Opposition Members have expressed suspicions about the Government’s motives for setting up the Silk commission. There are suspicions that the Government might be trying to sell Wales short and push through measures that would seriously disadvantage Wales. The concentration of wealth creation in London and south-east England means not only in Wales but in Scotland, Northern Ireland and the other regions of England that public expenditure is greater than the income from those areas, which are all net beneficiaries of the UK tax regime, while London and parts of the south-east and East Anglia are net contributors.

That is for historical reasons, including the early emergence of London as the commercial capital and its importance as a world financial centre, and it is in contrast to other European countries, where the importance of the city state and, much later, unification has produced different patterns of wealth distribution. The disparities have existed in the UK for many years: they are deeply embedded and cannot simply be eliminated by a few years of regional policy or European funding, helpful as that is to compensate for the differences. Nor can they simply be eliminated by substantial growth in the private sector, vital as that is to Wales and across the UK.

With such deep-seated historical differences in wealth distribution, complete financial independence for Wales, as advocated by Plaid Cymru, is an absolute non-starter. With a gap of £14.6 billion between public spending and the revenue raised in Wales, it would mean every man, woman and child in Wales contributing an extra £4,800—nearly £5,000 each a year just to maintain current levels of spending.

[Nia Griffith]

Those figures were recently provided by the House of Commons Library, on 2 November, and I am sure that it has checked them thoroughly.

We are suspicious about the Government’s motives in setting up the Silk commission, whose remit excludes fair funding. It looks as if the Government might be using it as a back door to cutting funding to Wales, or seeking to adopt measures that could leave Wales subject to fluctuations in funding that would be impossible to cope with. The Labour party will strongly resist any moves that would disadvantage Wales.

Many people have been puzzled by the timing of the debate, as the remit for the Silk commission has already been set, so it did not offer an opportunity to influence its terms of reference. Perhaps, when the commission has had a chance to study the issues, it may wish to seek views or raise questions in an interim report, and that would be a more appropriate time for a debate. Having the debate now, before the commission has even begun its work, but after the terms of reference have been decided, is somewhat bizarre. [Interruption.] I think that the Secretary of State is trying to intervene, but the point was well made by my right hon. Friend the Member for Torfaen that that does make us question the reason for the debate.

[Mrs Gillan]

I should like to inform the hon. Lady and the House that the terms of reference were agreed with the Labour party in the Assembly.

[Nia Griffith]

The irony being that today we have discussed the importance of Parliament; many Government Members have referred to the importance of the commission being set up by Parliament.

Oral Answers to Questions

Debate between Cheryl Gillan and Nia Griffith

Wednesday 12th October 2011 Commons Chamber

[Mrs Gillan]

The hon. Lady makes a valid point. I know that the labour market statistics today have not brought good news, but I am pleased to report that there are 90,000 vacancies across the UK at the moment, including 12,638 in Wales. With the excellent job that is being carried out by Working Links and Jobcentre Plus, there are going to be many opportunities for people to find their way into work.

[Nia Griffith (Llanelli) (Lab)]

This morning we have seen a shocking increase in unemployment, with 16,000 more people in Wales desperate to find work—a massive 13.5% increase over the past three months—as a direct result of this Government’s policies. Given this huge rise in unemployment, plus the squeeze on household incomes in Wales as a result of the Government’s increase in VAT, the reduction in the real purchasing power of pensions and the cruel slashing of the winter fuel allowance at a time of rocketing energy and food prices, can the Secretary of State explain how her Government’s policies will stimulate consumer demand in Wales and get growth going? How on earth will they stem the spate of high street shop closures and put some sparkle back into—

[Mr Speaker]

I think we have got the thrust of it; we are grateful to the hon. Lady.

Oral Answers to Questions

Debate between Cheryl Gillan and Nia Griffith

Wednesday 29th June 2011 Commons Chamber

[Nia Griffith (Llanelli) (Lab)]

Given the Secretary of State’s discussions about enterprise zones with the First Minister and other Welsh Assembly Ministers, does she accept that whatever we do on the ground in Wales, and whatever stimulus the Welsh Assembly can provide, we still need a proper fiscal stimulus from her colleagues in the Cabinet here? What discussions has she had with her colleagues in the Treasury about ensuring that growth happens?

[Mrs Gillan]

The hon. Lady makes a very good point, and that is exactly why, following the Budget, there was an increased provision for the Welsh Assembly Government of £65 million. Just to correct any figures that have been bandied about, I have checked with the Treasury and £10 million of that £65 million was Barnett consequentials for enterprise zone expenditure, and £20 million was for small business rate relief consequentials. I am sure that with £30 million the Welsh Assembly Government will be able to do something.

Oral Answers to Questions

Debate between Cheryl Gillan and Nia Griffith

Wednesday 11th May 2011 Commons Chamber

[Nia Griffith (Llanelli) (Lab)]

Given that an enormous amount of time and money has been put into studying tidal energy in the Severn estuary, what efforts is the Secretary of State making to take forward the plans for that and ensure they do not get lost?

[Mrs Gillan]

The hon. Lady knows that throughout the years when I have been both shadow Secretary of State and now Secretary of State for Wales, I have been very supportive of all the work that has been done, particularly on tidal lagoons, as well as in examining the case for the Severn barrage, which has, of course, been put to one side for the time being. I can assure her, businesses in her constituency and our research institutes that we will always consider that option for future generation in and around the Welsh coast.

Oral Answers to Questions

Debate between Cheryl Gillan and Nia Griffith

Wednesday 8th September 2010 Commons Chamber

[Mrs Gillan]

I am sad that the hon. Gentleman has to ask such a question, but he knows that he has to because the last Government left this economy in tatters, and it has fallen to this coalition Government to put the economy back together again. As he well knows, we are providing an environment in which business can do business in the UK. We are reducing corporation tax by a penny each year, which will give us one of the lowest corporation tax regimes in the European Union, we have reduced the taxation regime for small companies, and we have incentives on national insurance for entrepreneurs setting up businesses. I can assure him that we are doing everything that we can to create a healthy environment in which businesses and private business can prosper.

[Nia Griffith (Llanelli) (Lab)]

What assessment has the Minister made of the impact on private businesses in Wales of the loss of public service contracts and purchasing power caused by redundancies, cuts to rises in benefits and the proposed new VAT regime?

[Mrs Gillan]

The hon. Lady knows that the deficit needs to be tackled immediately, and it was her Government who left us in this dire financial situation. Of course, I cannot pre-empt anything that might happen in the comprehensive spending review, but I recognise the vital role that public sector contracts play in the prosperity of businesses across Wales, and I know that the economy is heavily dependent on the public sector, so I have already made representations to the Treasury, and will continue to do so. However, I am afraid that the financial mess we are in was the responsibility of her party.