GDP per Capita

Lord Blunkett Excerpts

Tuesday 11th June 2019 Lords Chamber

[Lord Young of Cookham]

The noble Lord has been a tireless campaigner for 45 years, in the other place and now here, for reducing the inequalities between Wales and the rest of the United Kingdom. He cited income; the figures I gave were for gross value added. If you look at gross disposable household income, which is slightly different, the gap is slightly narrower but still there. Since 2010, Welsh gross value added per capita has grown by 24%, faster than in Scotland and Northern Ireland. To address his question, he is quite right that when the EU structural funds expire as we leave the EU, the shared prosperity fund will take their place. The size of the shared prosperity fund is a matter to be resolved in the current spending review. There will then be consultation on how it is allocated. However, I have received a very strong message from the noble Lord and from the Welsh Government that they want the replacement to be at least the same size as the structural funds and allocated primarily on the basis of need, and they want the devolved Assemblies and local partners to be involved in that decision. While I cannot give a cast-iron guarantee, I have given one with green tinges round the edge.

[Lord Blunkett (Lab)]

My Lords, is it not true—perhaps the Minister could confirm this—that the England figure hides the most enormous disparity between London and the south-east and the rest of the country? That gap in GVA, GDP and productivity can be met only by a proposal put forward by the commission chaired by the noble Lord, Lord Kerslake, equivalent to the kind of investment and programme put in place by West Germany when it combined with East Germany. That would overcome not only the disparity described this afternoon but the deep alienation and division that exists in our country.

[Lord Young of Cookham]

The noble Lord makes a powerful case for a generous shared prosperity fund. The Government have tried to do what they can to reduce the disparity; extra funds were allocated to Wales in the 2018 Budget, giving the Welsh Government a £550 million boost. The GVA figures for London are slightly distorted by including people who commute into London but do not live in London. None the less, there is a regional imbalance. Public expenditure per capita is much larger in Scotland, Wales and Northern Ireland than it is for England. That is one of the ways that the Government seek to redress the imbalance the noble Lord just referred to.