Shared Prosperity Fund: Wales

David T C Davies Excerpts

Wednesday 14th November 2018 Westminster Hall

[David T. C. Davies (Monmouth) (Con)]

Thank you very much for calling me to speak, Mr Hollobone.

I thank the hon. Member for Wrexham (Ian C. Lucas) for introducing the debate and add to his call for the Government to ensure that Wales continues to receive the same amount of money. We will certainly have that when we leave the European Union—we will have a lot more money to spend. I differ from him on one important point, though, because I think he was arguing for a system where we simply hand over money to the Welsh Government and allow them to get on with it. We know that at the moment the European Union has some control over how that money is spent in two ways: first, it sets the rules of the game on state aid or anything else and, secondly, it has the powers to investigate when money has been misspent. It is vital that we maintain some form of central control, and here I must be a little critical.

The Welsh Assembly Government have failed on numerous occasions properly to monitor how money that has been spent in grant funding has been used. We have seen some quite scandalous decisions taking place. Some might be down to monumental incompetence; others, I fear, are due to out-and-out corruption. I will run through a couple of them and I challenge anyone to suggest that this sort of thing is right.

There is the Lisvane land deal. The Welsh Government had £20 million-worth of land—if it were good just for agriculture—that was sold at agricultural value to an organisation based in the Channel Islands. Within a matter of months, it received planning permission for housing, meaning that the Welsh taxpayer lost out on tens of millions of pounds.

There is the decision by Welsh Assembly Ministers to go into the film business, which began, as the auditor’s report shows, with the decision to buy a premises down near Newport, in Wentloog. Approximately £40 million was spent making films, and the auditor’s report says rather coyly that not much money has been recouped. About £4 million has come back. The rest of the films have either not been made or have not been seen by anyone. One of the excuses for its failure was that the Welsh Government had decided to get involved in another film studio elsewhere in south Wales. They handed over a couple of million pounds in the form of a grant, much of which appears to have been paid to the directors. There is a string of these decisions going on.

[Wayne David]

Will the hon. Gentleman give way?

[David T. C. Davies]

I will, but I am going to have my four minutes. I am coming to one of the more scandalous examples, but if the hon. Gentleman wants to intervene, he should feel free.

[Wayne David]

I recognise that the hon. Gentleman is using parliamentary privilege to the full here. Will he clarify how much of this is European money?

[David T. C. Davies]

I have not used parliamentary privilege to the full yet, but I might be about to. Some of the money certainly has been European money.

[Wayne David]

How much?

[David T. C. Davies]

I do not know the exact amount, because we are dealing with many millions of pounds here. What I do know is that if we are going to allow the Welsh Government to have a large amount of money to spend on giving out grants or putting it into infrastructure, we need to be absolutely certain that some central authority can monitor how that money is spent.

With all due respect, perhaps the hon. Member for Caerphilly (Wayne David) would like to cast his mind back to the disgraceful situation with Circuit of Wales, where £9 million was handed over to the director of a company—a director who had been making donations to the Labour party. Some of that money was then taken and given to another company, which that same director was also the director of. There was no proper tendering procedure. If anyone has any doubts about this, the whole thing is written up in the Welsh auditor’s report. What we saw happening was that £1 million went over, in the form of an untendered amount of money, to a company that was owned by the person who had received the grant in the first place. There were no proper checks and balances. The same person was able to go and buy a motorcycle company based in Buckinghamshire.

--- Later in debate ---

[Mr Philip Hollobone (in the Chair)]

I would regard nothing that Mr Davies has said thus far as out of order, but I note Mr David’s objections and I am listening closely to all contributions made by all Members. I draw Mr Davies’s attention to the clock. He has just over a minute left.

[David T. C. Davies]

None of these is an accusation. They are all in the Auditor General’s report, which only came about as a result of the information that I gave them, because nobody in the Welsh Assembly—neither Members nor Government—was particularly interested in the fact that millions of pounds of their money was being spent. The reason I sent the information off was that the directors of that company came into my office and told me that their project was being backed by BMW and General Electric. It was not, because I checked with them afterwards. Then the directors sent their lawyer, Jonathan Coad, to try to take legal action against me, Martin Shipton and Trinity Newspapers, for falsely alleging General Electric and BMW’s involvement, but they did not realise that my tape recorder had accidentally been left on at the time and I had the whole thing on tape.

I say to hon. Members that the Welsh Assembly Government have failed over and over again. At least one civil servant’s name comes up every single time, many of the people involved in the decisions are all known to each other, and a lot of them have links back to the Labour party. I have touched on only three or four projects, but we all know that there are various others—Kukd was another one, as well as Kancoat and Blurrt. One after another, projects have received large amounts of funding, often running into millions, from the Welsh Government, and no proper checks and balances have been pursued.

[Mr Philip Hollobone (in the Chair)]

Order. I call Mr Ben Lake.