Leaving the EU: Wales

Jonathan Edwards Excerpts

Tuesday 25th October 2016 Westminster Hall

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

It is a pleasure to serve under your chairmanship, Mr Bailey. I congratulate the hon. Member for Aberavon (Stephen Kinnock) on securing this debate. I agree with much of what he said in his excellent introduction.

As a democrat, I fully accept the referendum result, but that does not mean that the ideological Brexiteers in charge of Government policy at the moment can act with impunity. There is an ongoing fight for the type of Brexit we will have, and my priority is to campaign for the least damaging option for the Welsh economy and for Welsh funding and finances. That is why Plaid Cymru and I have been united in our campaign to maintain membership of the single market and the customs union from the very beginning. That would be by far the least damaging option for the Welsh economy, first, because there are wide-reaching benefits to being a single market and customs union member for trade in Wales; and, secondly, because it will enable Wales to qualify for certain cross-border and transnational programmes for research and innovation funding, which the hon. Gentleman mentioned in his opening remarks.

Wales is more exposed to a hard Brexit because we are an exporting economy. We have a trade surplus of £5 billion per annum, whereas the UK has a massive trade deficit. Wales’ great trade figures are aided by our membership of the single market—the world’s largest trading bloc—and the 53 international trade deals that we have by being a part of the customs union. The Centre for Economics and Business Research found that more than 4 million jobs directly and indirectly depend on exports to the EU. That is approximately 200,000 jobs in Wales—about 14% of our workforce. That should make our eyes water.

The hon. Gentleman talked in great detail about many of the different types of funding streams that we qualify for due to our membership of the European Union. The UK is the most unequal member of the European Union, in terms of the geographical gap in wealth. The richest region in northern Europe is London and the south-east. Nine of the poorest regions in northern Europe are also in the UK. Tragically, they include the communities that I and many colleagues here serve.

In contrast, the UK has no regional policy for moving wealth from richer to poorer parts of the state. The EU has a very successful regional strategy, and Wales has qualified for three rounds of the highest form of structural funding. Of all the funding streams that we receive from the European Union, the loss of that structural funding—we probably qualify for a fourth round, given the state of the Welsh economy at the moment—would be the biggest hit for us. We could also lose very cheap finance from the European Investment Bank, which has helped to deliver the excellent new campus at Swansea University, which the hon. Gentleman mentioned.

Wales has benefited from many other EU funding opportunities, including for agriculture, fishing and rural areas, education, training, and research and innovation. The education, training and research schemes will still be available to us if we remain a member of the single market and the customs union, but the huge support our rural economy receives in common agricultural policy payments will not. I believe that we received about €3 billion to support our rural economy between 2007 and 2013. Our economy depends on those streams. Even under my preferred deal, we would not qualify for CAP payments. Norway gets around that by paying the CAP payments and tariffs that it would receive if it were in receipt of CAP. Unless we have those guarantees from the UK Government, I fear dark days lie ahead for the rural economy and the Welsh economy as a whole. Diolch yn fawr iawn.