Wales: Economy

Lord Ahmad of Wimbledon Excerpts

Monday 7th April 2014 Grand Committee

[Lord Thomas of Gresford]

My Lords, I, too, congratulate the noble Baroness, Lady Morgan, on obtaining this debate. Perhaps it is a good thing that it is limited to the Welsh economy, because it would be dangerous for her to refer, for example, to the National Health Service in Wales. The noble Baroness, Lady Gale, has just referred to the Welsh Labour Party conference in Llandudno. In his speech to that conference the First Minister, Mr Carwyn Jones, said that there were “difficult truths” about the NHS in Wales, and that examples of poor care in Welsh hospitals were unacceptable. He conceded that there was complacency at the top of local health boards, and said that Labour Ministers must “hold up” their,

“hands and say, yes we could have done better”.

We sometimes seem to be living in a different country when I hear the Welsh Government praised. The debate might also have been about the state of Welsh education, on which topic in the same speech Mr Jones had no answers but said that the schools system had “coasted” for too long. We once thought we led Britain in educational attainment, but the reality today is that we have fallen too far behind.

What was the First Minister’s answer to these criticisms? To declare that any criticism of his Government was the work of a Tory elite waging war on Wales. Labour, he said, was on the front line of the war on Wales. How pathetic is that, and how disappointing to hear that empty rhetoric, that newspaper headline, being used in this House? I have to say that it causes me great dismay.

The Welsh economy is in need of serious overhaul. The Welsh Labour and Labour-Plaid Administrations in Cardiff Bay have not placed enough emphasis on equipping Wales with the infrastructure and the skills necessary to compete globally. The economy has serious longstanding structural problems. There was a time when Wales attracted inward investment from foreign countries on the basis of low labour costs and low land costs, but that was not sustainable and it is no longer a unique selling point for Wales, nor should it be.

Transport infrastructure is of course crucial. In government, the Liberal Democrats pressed for the electrification of both the Great Western main line as far as Swansea and the totality of the valley lines. The decision has now been taken with the support of the Prime Minister, as my noble friend said. However, it now appears that the Welsh Labour Government are reneging on their financial undertakings to support that development.

What about the rest of Wales? Money is certainly promised for a new line for the M4 motorway across the Gwent levels and relief for the Newport tunnels, but in north Wales, plans to dual the railway line between the two vital business hubs of Chester and Wrexham and their surrounding industrial areas have been scrapped, while we can whistle for the electrification of the north Wales rail line, which carries freight to Ireland. That line is not part of the strategic freight network at all.

An excellent survey was published last weekend by the Welsh policy unit of the Federation of Small Businesses. It accepts that the British economy is recovering: 14% fewer of its Welsh members identify the economy as a barrier to growth than in its previous survey in 2011. However, the comparison in the survey between the views of their members in Wales and those of their members in the rest of the UK is revealing. Significantly, more businesses in Wales are concerned about the cost of finance, and indeed of obtaining finance at all, to expand and develop their enterprises and create more jobs. We would look for a creative solution to that from the Welsh Labour Government, but there is none. Businesses, it appears, are hit by higher business rates than in England, which, with falling rental values, leads to the dereliction of so many of our towns across Wales, as we know as Welsh people.

There is also great concern in the business community about the provision of fast and reliable broadband access. Our digital infrastructure, which should allow business to grow and compete in a global market, is not developed in Wales. We have languished at the bottom of the UK league tables for broadband speeds for years, and we have suffered with a lower proportion of households able to access broadband than any other part of the UK. I wait to hear what is the new initiative to which the noble Baroness, Lady Morgan, referred, to see what it produces or whether the Welsh Government will be holding their hands up again on that issue.

Many employers are concerned about the low skill levels in Wales, which affect productivity and are a source of competitive disadvantage. Basic skills attainment is lower in Wales than across the United Kingdom as a whole and 4% lower than in Scotland. Higher skills attainment is 3% lower than across the United Kingdom and 7% lower than Scotland. Wales is lagging behind. Where is the wonderful improvement to which the noble Baroness, Lady Morgan, referred?

Taking the point of the noble Baroness, Lady Gale, Labour is allowing Wales to fall behind with regard to childcare. It has been said that 1 million women are missing from the United Kingdom workforce, because it does not make sense financially to go back to work. That is even more so in the case of Wales. The Family and Childcare Trust’s annual childcare survey of 2014 showed that childcare costs in England are falling in real terms for the first time in 12 years, while in Wales the cost of nursery care for under-twos has increased by nearly 12%. So there is a massive agenda—

[Lord Ahmad of Wimbledon (Con)]

The noble Lord’s time is up. This is a time-limited debate to 60 minutes. We can have a brief intervention, but my noble friend needs to conclude his remarks.

[Baroness Morgan of Ely]

Will the noble Lord comment on the fact that average costs of childcare in Wales are 10% lower than in England in every segment of care from under-twos to after-school clubs. So there is propaganda in his comments that is absolutely not true.