North Wales Economic Infrastructure

Chris Ruane Excerpts

Wednesday 25th March 2015 Westminster Hall

[Mark Tami]

All right, then; I will make that point. That example illustrates the fact that no matter how big a company is or how long it has been there, if events turn against it, the impact can be devastating. More recently, UPM paper mill, which I consider to be a benchmark employer—I certainly would not have put it on a list of companies in difficulty—announced that it would be cutting 120 jobs from its 370-strong work force. Why? Because the demand for newsprint worldwide has declined. When the recession hit, people stopped buying newspapers and magazines. Even as we slowly come out of recession, people’s habits have changed and they use the internet more, so demand has not picked up again.

In 2001, Corning Optical Fibre, a high-tech firm on Deeside industrial park with more than 400 employees, closed virtually overnight when world demand for optical fibre suddenly collapsed. So sudden was the collapse that I remember seeing at the factory millions of pounds-worth of equipment that was still in its wrapping and was never fitted. The lesson is that we cannot rest on our laurels.

[Chris Ruane (Vale of Clwyd) (Lab)]

My hon. Friend speaks of the collapse of investment at Corning. What assessment has he made of the changes that the Conservatives made to the feed-in tariff when they came back into power in 2010? What impact did that have on Europe’s biggest solar panel factory in Wrexham?

[Mark Tami]

Wrexham is not in my constituency, but people who lived in my area worked at that plant, and I saw that it had a devastating impact. One of the worst aspects of the situation was that the company was, I believe, encouraged to take on a lot of employees because it saw growth, but that was cut from under it by the changes that the Government introduced. We cannot simply assume that everything will be good, and we must make sure that we give existing employers the support and encouragement that they need to invest and grow.

We must also look at what we can do to encourage new employers and companies to come to the area. I am not talking so much about financial assistance, but we can offer a high-quality, highly skilled work force and employers can look to grow their businesses. Large employers such as Airbus—with more than 6,500 employers on site, it is one of the largest manufacturing plants in western Europe—have a role in encouraging their suppliers to site themselves nearby. Airbus has been successful in doing so, and we now have about 2,000 employees who work for Airbus’s supply companies. That makes sense for the supplier and the prime, because it is much easier to sort out problems if people can walk or drive across from one company to another than it is if goods are brought in from a long way away or even from a different country.

[Chris Ruane]

I thank my hon. Friend for giving way yet again. He mentioned the fact that some 7,000 people work in the Airbus factory in his constituency. There is another factory in Filton, near Bristol, and 70,000 people are involved in the supply chain. What impact would withdrawal from the EU have on the 70,000 who work in the supply chain of the joint European Airbus?

--- Later in debate ---

[Mr David Jones (Clwyd West) (Con)]

It is a huge pleasure to serve under your chairmanship, Sir Roger. I congratulate the hon. Member for Alyn and Deeside (Mark Tami) on securing the debate. At the start of his remarks he made an important point when he identified north Wales as not so much a discrete region, as part of the much larger and important north-western economic region. That is extremely important, because I frequently feel that people in Whitehall and—dare I say it?—Cardiff do not understand north Wales’s relationship with the large cities of north-west England such as Liverpool and Manchester.

That is why I echo what the hon. Gentleman said in applauding the work of the Mersey Dee Alliance, an extremely important vehicle for cross-border co-operation. It should be given even more recognition and regarded as a statutory consultee by not only the Westminster Government but the Government in Cardiff on all aspects of economic development in north Wales.

I want to focus my brief remarks on rail transport in north Wales, because, as the hon. Gentleman rightly said, that is an important element of the north Wales economy. I am optimistic. Like him, I attended the event organised by the North Wales economic ambition board and I believe that Members of Parliament of all parties support working towards electrification of the north Wales main line.

The hon. Gentleman also mentioned what he called the Wrexham to Bidston line. He is right that hon. Members have debated that old chestnut in this House for many years. The economic case for electrification of that line is probably stronger than ever, but I think that, because we are Welsh, we tend to look at that through the Welsh prism: Wrexham to Bidston rather than Bidston back towards Wrexham.

What has changed over the past few years has been the establishment of two important enterprise zones: one, as the hon. Gentleman said, is in Deeside, but the other is at Wirral Waters in Birkenhead. The Wirral Waters enterprise zone is almost immediately adjacent to the station at Bidston, and those two zones could benefit immensely from being linked by a fast, electrified line, which would put Deeside within easy commuting distance of the centre of Liverpool.

Only a few weeks ago, Network Rail announced proposals to create a new hub at Shotton, which provides an enormous opportunity for hon. Members to press Network Rail and Merseyrail to look again at the prospect of electrifying that important line. That would effectively put those two enterprise zones within a 15-minute commute, which would create enormous synergy. Perhaps we could then speak in terms of extending electrification down as far as Wrexham, for which the hon. Member for Wrexham (Ian Lucas) has pressed for many years. However, if we take an incremental approach and initially think about improving that important stretch of line, we will lay the foundations for an enormous boost to the economy not only of north-east Wales but right across the region, from the River Conwy to Ellesmere Port and beyond. The Minister could do well to put that to Network Rail; the time is right. We need to do as much as we possibly can to integrate the north Wales economy even further into the Merseyside economy.

In the next Parliament there will be considerable debate about so-called English votes for English laws. When one has regard to the extent to which not only public services such as health in north Wales but the economic considerations we are debating today are bound up with those across the border and tapped into the north-west economy, one sees that it is essential that whatever arrangements are put in place should give proper recognition to the legitimate concerns of north Wales Members.

[Chris Ruane]

Does the right hon. Gentleman believe that Welsh Members should be able to vote in the British Parliament on health, education and transport issues?

[Mr Jones]

I have already said many times and I am quite happy to repeat—that is why I started by saying that frequently I think politicians in London and Cardiff do not fully understand the north Wales element—that whenever any such issues touch and concern the interests of the people of north Wales, their representatives should have the right to speak on those issues in this Parliament.

--- Later in debate ---

[Chris Ruane (Vale of Clwyd) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Roger. I congratulate my hon. Friend the Member for Alyn and Deeside (Mark Tami) on securing this important debate.

My proudest moment as an MP came in 1999, when I secured access to European objective 1 funding for Denbighshire and Conwy. The map was redrawn after I lobbied my right hon. Friend the Member for Neath (Mr Hain), who was a junior Minister in the Wales Office at the time. Since then, more than £200 million has been invested in economic infrastructure in my county alone. I believe that the same amount has been invested in the county of Conwy, which is represented by the right hon. Member for Clwyd West (Mr Jones).

That important injection of investment has helped the economies of Denbighshire, Conwy and the whole of north Wales. It has helped to fund projects such as the £10 million redevelopment of Rhyl harbour; the £4 million Drift Park development on Rhyl promenade; buildings in Prestatyn, such as the one colloquially known as Tango towers; and, 10 years ago, the best European regional development fund project in the whole European Union, the Opto-electronics Technology and Incubation Centre, or OpTIC. All that investment occurred because we are partners with Europe. It will disappear if we pull out.

We have another seven years of European funding to go; possibly another £100 million to £150 million could be pumped into my county and constituency, if we stay in the EU. We will not get that funding if we pull out. Since 2009, the economy of north Wales has benefited from £1.2 billion of European funding. That is a massive amount of money to inject into the economic infrastructure of north Wales. If we leave the EU, not only will we lose that funding, but companies such as Toyota have said that they will pull out. Airbus will not get its future investment. Seventy thousand jobs in the UK depend on Airbus—do we really want to lose them?

In north Wales, there is £800 million-worth of public procurement, what with the police, the fire service, the health authority and local authorities across the region. Public investment from the public sector, which Labour believes in, is helping to prime the north Wales economy. If public procurement is handled properly, the economic multiplier can be seven times what is put in. If public money goes to a local firm with local contracts, employing local people, that money stays in the local community; if it is given to a multinational company, it will disappear, or there will be no economic multiplier.

I am proud of Labour’s public investment and procurement record in Wales. I will give some examples from over the years. Labour invested in Rhyl college. In the past, people who lived in Rhyl had to travel 25 miles to and from Deeside college every day, or 20 miles to and from Llandrillo college—40 miles a day, or 200 miles a week. Labour founded the college in Rhyl, and then Denbigh college was founded, so local people could upgrade their skills locally.

That is in the past, but the Welsh Labour Government are currently investing £35 million in the refurbishment, redevelopment and rebuilding of schools in Denbighshire. Denbighshire county council is also investing £35 million, so that is £70 million overall. The £35 million that Denbighshire is investing is the result of excellent funding over the past 10 or 15 years. In my patch, local Conservatives have criticised that investment in their own local authority. In 1997, investment in Denbighshire local authority was £63 million; today it is £163 million. They have criticised Labour for the investment that is allowing us to build schools.

I recently visited Rhyl high school, which is under construction and set to cost £23 million. The builders, Willmott Dixon, told me that of that £23 million, 60% will be spent within a 30-mile radius of Rhyl. That will localise procurement and maximise jobs, skills and investment in our local economy. I congratulate Huw Lewis, the Education Minister in Wales, for going ahead with that excellent £70 million investment in our local economy.

Energy has been mentioned, and it is key in north Wales. The £20 billion investment in Wylfa is fantastic news—it will mean 8,000 jobs. The tidal lagoon going from Penrhyn bay to Prestatyn will be 28 km long and 11 times bigger than the Swansea bay lagoon. It is set for £5 billion of investment, of which 56% will be spent in Wales.

[Mr David Jones]

I agree entirely with the hon. Gentleman on the attractiveness of the tidal lagoon project. It is, of course, a private sector proposal, as he will know.

[Chris Ruane]

Absolutely. It is a private sector proposal, and that is good. I am not saying that private sector investment is bad; I am saying that to castigate the public sector, day in, day out, decade in, decade out, is wrong. The public sector has a vital part to play in providing essential services and priming our economy. If it goes ahead, the tidal lagoon project will bring £5 billion of investment, which will help to transform the economy of north Wales, especially alongside the £20 billion investment in Wylfa.

About 10 years ago, I switched on 30 turbines at North Hoyle off the coast of Rhyl. When he was at the Conservative party conference in Llandudno as Leader of the Opposition, the Prime Minister referred to those turbines as “giant bird blenders”; he then went back to Notting Hill and stuck a bird blender on his house. That shows the Conservative party’s lack of belief in renewable energy. Another indicator of that, from a north Wales perspective, was the changing of the feed-in tariff in 2010 so that the biggest solar panel factory in western Europe, in Wrexham, had to close down.

On transport, I agree entirely with my hon. Friend the Member for Ynys Môn (Albert Owen) that we have to see transport connections in north Wales not from a north Wales perspective but from a European perspective, linking Dublin, Holyhead, Manchester, Hull, the Baltic states, Crewe, London and the rest of Europe. We must invest in a strategic trans-European network. We cannot be left as a branch line when billions of pounds are being pumped into HS2, HS3, HS4 and whatever. We need to be a main artery linking Dublin to the rest of Europe via north Wales and Holyhead.

That is so important because £53 billion in trade flows each year back and forth between Ireland and the UK. The principal port is Holyhead, and we want to keep it that way. More trade is conducted between Britain and Ireland than between Britain and Russia and Britain and China put together. That is how important it is. That is how important the transport links are. We must also have electrification, and connections to Manchester and Liverpool airports are really valued—we need a connection right into those airports.

In this very Chamber about 18 months ago, I mentioned a hovercraft connection between Liverpool and Rhyl. We had one more than 50 years ago—the first hovercraft passenger connection in the whole world—and we want to see the project taken up again. We have had some support from a Conservative Transport Minister, and we are looking to the Welsh Government to support the project. A hovercraft connection could bring 200,000 visitors to north Wales each year.

The right hon. Member for Clwyd West mentioned private sector investment. I welcome the excellent work done by councillors and officers in Denbighshire to attract Neptune Developments from Liverpool to Rhyl to develop £30 million or £40 million-worth of tourism infrastructure. The news was reported in the Daily Post some six or seven weeks ago, and it is a fantastic development. We must ensure that the hovercraft lands exactly where the development is going to take place.

I have discussed hard infrastructure, but there is also soft infrastructure: people, and how we treat them. Under Labour, the future jobs fund put 420 young people back to work in my constituency. The first malicious and malign act of this Conservative Government in June 2010 was to end the future jobs fund. The Welsh Government took up the baton and developed Jobs Growth Wales, which has an 80% success rate at getting young people back to work or into training. That is excellent work.

In 2007, I established the Rhyl City Strategy, which has helped to put thousands of people back to work or into training. We need decent housing for local workers. The Welsh Government are pumping £28 billion into west Rhyl to create housing for people to buy. This is fantastic investment from the Welsh Labour Government, but it will all be put under threat if the Tories get in on 7 May.

[Owen Smith (Pontypridd) (Lab)]

It is a great pleasure to serve under your chairmanship this morning, Sir Roger. Also, given the north Wales connections with the aircraft industry, I add my words of condolence to those of my right hon. and hon. Friends on this sad day after the air crash in France.

I, too, congratulate my hon. Friend the Member for Alyn and Deeside (Mark Tami) on securing his second debate on the economic infrastructure of north Wales. I also congratulate all right hon. and hon. Friends on their contributions to the debate—a measure of their continued determination, as it is of all north Wales Members, to see north Wales prosper. We have heard excellent contributions from everyone.

My hon. Friend the Member for Ynys Môn (Albert Owen) said it was a shame that he is the only representative of north-west Wales present; no other parties from the north-west are represented in the Chamber. It is a shame that Plaid Cymru Members are not here—perhaps they have something else on of rather more importance.

That, however, is one of the lone party political points that I want to make today, because the debate has not been party political; it has been a constructive debate with an enormous amount of consensus—

[Chris Ruane]

I did try!

[Owen Smith]

For all my hon. Friend’s attempts, we were largely consensual.

There was a huge amount of agreement in the Chamber about the challenges that face north Wales on the economy and its infrastructural links and what we need to do about energy, transport, rail, road, schools building, housing and so on. My hon. Friend the Member for Alyn and Deeside summed things up when he talked about north Wales as an industrial powerhouse. We have terrific, world-beating companies in all the constituencies represented in the Chamber today. We need to ensure that those companies are nurtured and grow, and that the certainty required in terms of investment is maintained by whoever wins the election in May. Any uncertainties such as those about the future involvement of the UK in Europe need to be eradicated.

Another point made with great force and vigour by my hon. Friend the Member for Alyn and Deeside was the need for investment in education and apprenticeships in north Wales and throughout the UK. The connections that have already been made between companies such as Toyota and Airbus and the local colleges, Coleg Cambria and Glyndwr university, are exemplars for the whole of the UK. We need to ensure that we maintain those connections.

The former Secretary of State for Wales, the right hon. Member for Clwyd West (Mr Jones), made an extremely positive contribution on two key points, first, on the vital cross-border links. I agree that too often in all parties our public dialogue on Wales concentrates on the border. We need to get past that. The next phases of devolution must be about greater partnership and integration, acknowledging the fact that companies do not recognise the border in the way in which public policy often does.

The right hon. Gentleman’s points about connecting the two enterprise zones through the Wrexham to Bidston line, making it a 15-minute journey, and about the benefits that can be derived from thinking more holistically about the whole of Deeside and north-west England as an economic powerhouse and zone were extremely well made, as was his contribution about English votes for English laws. I agree with him wholeheartedly that we must carefully guard against short-term political expediency for some parties getting in the way of the vital need for our constituents, in particular in north Wales, to have a say on services and decisions that affect them as much as they affect people in England.

Those points were well made by the right hon. Gentleman and were reflected in the contribution of my right hon. Friend the Member for Delyn (Mr Hanson). He, too, highlighted the interconnection of our north Wales economy with that of the north-west. For example, on HS2, my right hon. Friend made it clear that in order to derive the full benefits for north Wales we need the Crewe interchange to be delivered and real investment in and understanding of the benefits. Crucially, he made a point about the recent rhetoric from the Chancellor about the northern powerhouse—welcome rhetoric and welcome emphasis on the north of England from a Tory Chancellor.

However, recent comments by Ministers in the Wales Office about creating a north Wales powerhouse are perhaps a bit muddleheaded. We need to think more along the lines of what my right hon. Friend the Member for Delyn said, that north Wales is in many respects connected inextricably to the north-west and the north of England. When we talk about the northern powerhouse, as I suggest whoever succeeds in May must continue to do, we should be thinking about north Wales as an integral part of it; we should not talk simply about something within Wales, of north Wales versus the south.

My right hon. Friend also made some excellent practical suggestions about the need for better transport links between his constituency and north Wales generally and the airports that serve north Wales—not Cardiff Wales airport, but Liverpool and Manchester. Such points of connection are vital. Other practical suggestions included extending Flint train station in order to allow the new trains to continue stopping there.

My hon. Friend the Member for Ynys Môn made a characteristically ebullient and passionate defence of his island, describing it as being at the heart of the whole of the British isles. I would not dare contradict him. He also challenged the Hansard reporters with his excellent pronunciation of Llanfairpwllgwyngyllgogerychwyrn- drobwllllantysiliogogogoch—they can do it twice now, if they would, please. He, too, spoke about the three key challenges: energy, transport—rail and road—and tourism. The Horizon project on Anglesey is supported throughout the House and it will be an enormous benefit to Wales, with 6,000 to 8,000 jobs in construction, as he said, and a further 1,000 jobs to maintain it. Cross-party consensus in support of nuclear energy in Britain is vital, to the benefit of not only north Wales but the whole of the UK and our energy security in insecure times.

My hon. Friend made two unique points in his contribution, one about our ports, and Holyhead to Dublin becoming as important a connection as Dover to Calais. That is a vision to which we should all subscribe. Cross-party consensus on devolving power over ports to the Welsh Assembly Government is important. I anticipate and hope that his suggestion will be picked up. He was also the only one to mention mobile phone coverage, which is enormously important to modern business. Coverage remains far too patchy in Wales, and north Wales is one of the areas in which we must do more.

My hon. Friend the Member for Vale of Clwyd (Chris Ruane) made an excellent contribution. In particular I highlight his description of the benefits to Wales of our continued membership of the European Union. He mentioned Rhyl harbour, Rhyl promenade and the OpTIC research and incubation unit, which are only three examples of the £1.2 billion of investment in Wales as a result of our membership of the EU. He emphasised the risk to the great companies in north Wales—I have mentioned some, such as Toyota and Airbus. As my hon. Friend the Member for Alyn and Deeside said, they would not leave overnight were we to leave the EU, but their continued investment in north Wales and in Britain would inevitably be in jeopardy. The risks to our constituents in north Wales in respect of their security and to the long-term prospects for the economic health of north Wales should be clear to all of us.

My hon. Friend the Member for Vale of Clwyd also highlighted the excellent work of the Welsh Government in recent years in the teeth of big cuts to their budget— £1.5 billion less and 30% of the capital budget removed. That is part of the picture under the UK Government: according to the National Audit Office, there has been a £15 billion reduction in infrastructure investment. However, despite such problems, as my hon. Friend said, £70 million has been invested in schools in Denbighshire. He could also have mentioned the £64 million invested by the Welsh Government and local government in schools in Flintshire or the £30 million invested in schools on Ynys Môn by the Welsh Government. Such schools are also a vital piece of economic infrastructure investment for our future—perhaps more vital than some of the road and rail projects that we have discussed. The schools projects are a testament to the continued dedication of the Welsh Labour Government to investing in the future of our children in Wales, in contrast to—a final party political point—how the Building Schools for the Future programme was cancelled in England.

I shall bring my remarks to a conclusion with a brief reminder that we have an election just 40-odd days away now; in case Members had not noticed, this Parliament is coming to an end. There is a vast amount of agreement that north Wales requires further investment. Whoever wins on 7 May, Welsh Members across the House should put their shoulders to the wheel. I am confident that if, as I hope and believe, we have a Labour Government, we will see proper partnership once more between Wales and Westminster—in contrast to the war on Wales over the past few years under this Tory Government—and a proper contribution to delivering economic success and prosperity for the people of north Wales.

[The Parliamentary Under-Secretary of State for Wales (Alun Cairns)]

It is a pleasure to serve under your chairmanship, Sir Roger. I congratulate the hon. Member for Alyn and Deeside (Mark Tami) on securing this debate. I echo the sympathies expressed by him and others towards those involved in the tragic accident in Europe yesterday.

This has been an excellent debate, which has demonstrated cross-party ambition, hope and optimism for north Wales and its people, public services and economic prosperity. By and large, as the shadow Minister mentioned, it has not been party political; I am pleased about that, because the issue is how to secure the right outcomes for north Wales.

The story of north Wales over the past five years has been quite remarkable. We all know that the UK has the fastest growing economy in the G7, and Wales is the fastest growing part of the United Kingdom. Since 2010—I hope that everyone will recognise this—gross value added growth for the UK has been 6.8%. In Wales, the figure is 8.4%, but it has been remarkably strong in north Wales, at 13.3%. That is a fantastic demonstration of the efforts of everyone in north Wales—the individuals, the private sector, the public sector and the entrepreneurs who are delivering growth have all achieved that quite remarkable figure of 13.3%.

[Chris Ruane]

Is the Minister including the Welsh Government in his list of people to congratulate?

[Alun Cairns]

Of course—I said the public sector. Everyone has played a part in delivering that 13.3% growth in north Wales. Of course, it needed a stable financial settlement and stable economic platform from which to build it. North Wales has prospered remarkably from those conditions.

The debate has focused on a range of issues, but without question there is absolute agreement among all Members on the interdependence of north Wales and the north of England in general and the north-west in particular. That is key to the area’s future prosperity. The hon. Member for Alyn and Deeside picked up on that idea at the outset and focused on the Mersey Dee Alliance. I pay tribute to that organisation; I have met its representatives in my role as Minister and have been hugely impressed with its case. I also pay tribute to the local authorities in north Wales, whichever party runs them; their relationship with the Wales Office is probably stronger than that of the local authorities in south Wales because of their co-ordinated activity and determination to forge a relationship with Whitehall.

Coleg Cambria has been mentioned, and my right hon. Friend the Member for Clwyd West (Mr Jones) mentioned Glyndwr university. Those are both excellent examples of using the strength of the private sector in north-east Wales to deliver skills.