Nia Griffith
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Welsh Affairs
Nia Griffith Excerpts(12 years, 2 months ago)
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Mr Llwyd
No; quite the opposite. The whole point of the Development Board for Rural Wales was to assist existing businesses as much as to set up new ones. I remember going to help people and being told, “The bank says I have to borrow a minimum of £20,000, but I only need £10,000 to expand my business.” The board stepped in, and a solution was found in a matter of days. It was an excellent way of dealing with those things. That example related to an indigenous company that was hoping to expand, so no, I do not agree with the hon. Gentleman.
There is some truth in what the hon. Member for Monmouth said about university courses. At one stage, I was rather taken by a course in brewing at Strathclyde, but my father thought that a course in law at Aberystwyth would be preferable and he had the last word, so there we are. The brewing industry has probably lost someone who could have worked wonders. But I shall return to the serious matters.
The commission on devolution is chaired by Paul Silk, and it will report shortly. Everyone knows that it is to examine in two stages what further devolutionary steps could be taken. The first stage relates to fiscal powers. I note with great disappointment that the Labour party has apparently not submitted anything on fiscal powers to the Silk commission. I really cannot understand that. As I have said, I have the highest regard for the right hon. Member for Torfaen. He made the point about a very small minority being in favour of independence in the recent poll, but he did not mention the fact that 60% of those polled were in favour of fiscal powers being devolved to Wales. That is quite a large percentage, given the circumstances.
Nia Griffith (Llanelli) (Lab)
Sue Essex is the Labour party representative on that matter. Would the right hon. Gentleman accept that not making written submissions in advance gives her greater flexibility in the negotiations? Might not that be the way forward when trying to get four very different people to agree on something?
Nia Griffith (Llanelli) (Lab)
What a pleasure it is to see you here chairing the debate today, Mr Deputy Speaker, and sporting your daffodil. That is absolutely splendid. Before I begin, I should like to put on record the sincere apologies of the shadow Secretary of State, my right hon. Friend the Member for Neath (Mr Hain), who has constituency commitments today.
I should like to thank my right hon. Friend the Member for Torfaen (Paul Murphy), as well as the right hon. Member for Dwyfor Meirionnydd (Mr Llwyd) and the hon. Members for Montgomeryshire (Glyn Davies) and for Brecon and Radnorshire (Roger Williams) for making the case for a St David’s day debate to the Backbench Business Committee. I thank the Committee for agreeing to their request.
My right hon. Friend the Member for Torfaen opened the debate by emphasising the importance of Welsh MPs in Westminster, and the complexity of disentangling what constitutes an English matter. He also pointed out the fact that the UK Government’s Health and Social Care Bill could have major implications for the Barnett formula calculations and considerably reduce the Welsh budget. He referred to the importance of everyone, whatever their views, engaging in the discussion ensuing from the Scottish debate on independence.
The Chair of the Welsh Affairs Committee, the hon. Member for Monmouth (David T. C. Davies), focused on the Committee’s recent report on inward investment in Wales. The right hon. Member for Dwyfor Meirionnydd made the case for devolving taxation powers to the Welsh Government. The hon. Member for Cardiff North (Jonathan Evans) spoke of Wales’s sporting prowess and mentioned football governance. He managed to mention a school from his constituency—Whitchurch—as did the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart), who mentioned Whitland. My hon. Friend the Member for Ynys Môn (Albert Owen) then mentioned ysgol Bodedern. We certainly have something to be proud of in our schools in Wales.
My hon. Friend the Member for Swansea East (Mrs James) reminded us of the reality of everyday life for the many less well-off people across Wales who are being badly hit by changes to tax credits and welfare reform. I should like to place on record the fact that my right hon. Friend the Member for East Ham (Stephen Timms) has made the Labour position clear on these matters. It is that there have always been different levels for housing benefit according to regional factors, and it is that part that would vary regionally, not the disability element or any other part of the welfare reforms. My right hon. Friend made that quite clear in the media and at the Dispatch Box during the debate on those issues.
Nia Griffith
I will not give way.
The hon. Member for Brecon and Radnorshire spoke of the importance of small businesses in Wales, and my hon. Friend the Member for Vale of Clwyd (Chris Ruane) praised the benefits of mindfulness. The hon. Member for Carmarthen West and South Pembrokeshire reminded us of the beauty of Pembrokeshire, only to be upstaged immediately by my hon. Friend the Member for Ynys Môn. The hon. Gentleman also mentioned the contribution of local companies to the UK economy, which is extremely important.
My hon. Friend the Member for Ynys Môn referred to the need for clear policies on energy, and I shall return to that matter shortly. The hon. Member for Ceredigion (Mr Williams) made the case for devolving Welsh language broadcasting. Sadly, the hon. Member for Aberconwy (Guto Bebb) spent a great deal of time criticising a report, when his constituents would probably have been more interested if he had taken up the very real issue of rocketing prices at the petrol pump, particularly in rural Wales.
If we are to see the economy in Wales flourish, we need economic policies from the UK Government that will stimulate growth. We need fiscal policies that will strike the right balance between paying down the deficit and getting the economy going. We need taxation policies that do not squeeze lower and middle income households so hard that they have no money to put back into the Welsh economy and struggle even to pay the most essential household bills.
I was dismayed to hear the Secretary of State reiterate at Welsh questions yesterday that she was in favour of sticking to plan A. I am sorry to have to point out to her that her Government’s plan A is hurting but not working. Sometimes I wonder what planet she is living on. She only has to walk down any high street in Wales to see shops closing and the economy on its knees. The latest high-profile victim is Peacocks. We certainly welcome its takeover by the Edinburgh Woollen Mill and the jobs that that has secured, but 3,000 jobs will still be lost and more than 200 shops will close, including both the Peacocks stores in Llanelli.
No matter what initiatives the Welsh Government undertake—I point out two in particular: the excellent Jobs Growth Wales programme aimed at creating 4,000 jobs a year, with an emphasis on the private sector; and help for business in the form of some £55 million in grants and loans—UK economic policy is enormously important in helping or hindering the success of those initiatives. When it comes to inward investment to Wales from overseas, I certainly agree that there should be the closest possible collaboration between the Welsh Government and other relevant bodies such as UK Trade & Investment to avoid duplication and increase Wales’s outreach overseas.
We are not going to get anywhere, however, unless we have a UK Government providing the right economic and business climate to make the UK a preferred destination for investment in business and manufacturing. When Labour was in government, an additional 1.1 million new businesses were created. By the time we left office in 2010, the World Bank ranked the UK as the best country in Europe for ease of doing business and fourth best in the world, ahead of the US. While there is always room for improvement and we should seek to streamline wasteful bureaucracy, time-consuming duplication and form filling, to use cutting red tape as the main strategy for driving economic recovery, as this Government seem to be trying to do—and, indeed, as the Under-Secretary for Wales said yesterday at Welsh questions—is addressing the wrong problem. That is to avoid the two very real issues of creating the right economic conditions to foster growth and creating the right political climate—that is, the certainty about policy that is needed to encourage long-term investment in manufacturing and jobs.
The Government’s attitude to business and industry matters—it matters very much to Wales. What business and industry need more than anything are certainty and confidence that the UK Government will not move the goalposts. It is extremely disturbing that this Conservative-Lib Dem Government have created so much uncertainty about their commitment to green policies that the UK has slipped from third to 13th in the world for investment in green growth.
The Secretary of State and her Cabinet colleagues need to restore business confidence and create a climate of certainty before they damage any more industries or frighten off any more potential investors. We have seen how the UK Government’s catastrophic imposition of sudden changes to the feed-in tariffs for solar panels is already putting hundreds of jobs at risk in Wales. Here was a scheme that gave a real boost to private industry in Wales—a scheme that was unlocking capital and attracting people to use their savings or borrow money to invest in solar panels. By investing that £10,000 or £20,000, they were providing private sector jobs in the Welsh economy. What other scheme do the Government have to unlock capital in that way and use it to stimulate growth in the local economy?
As my hon. Friend the Member for Ynys Môn mentioned, before the election Labour set up a £60 million fund to attract investment in offshore wind power. In 2010, the current Prime Minister promised to continue the policy, but nearly two years later just £1.2 million has been awarded and many companies are looking elsewhere to invest. Indeed, big investors in wind energy, such as General Electric, Vestas, Gamesa and Mitsubishi, are threatening to take millions of pounds worth of green jobs abroad because they are losing patience with this Government. They do not know where they stand, and they now seriously doubt the Tory Government’s commitment to renewables.
The UK has some of the best wind resource in the world. Indeed, the UK is the windiest country in the EU, and we have our fair share of it in Wales, but the signals coming from the UK Government are confused, hesitant and lukewarm. When companies are making big decisions about where to build energy installations or set up factories to manufacture the components, they need to know what Government policies are, what returns they can expect and what the financial incentives are—they need a climate of certainty. I urge the Secretary of State and her Cabinet colleagues to provide clear policies to attract green investment.
Moving on to UK Government policy that affects Wales, only a fortnight ago we heard the very worrying news that Britain could lose its treasured triple A rating—the very justification the Chancellor has used for his crippling austerity measures. Why would the UK lose its triple A status? Because this Government have forgotten that in order to pay back the deficit, they also have to think of stimulating growth in the economy to make the money to pay back the deficit. That is where this Government are failing. This Government inherited a growing economy, so it is no wonder that people are asking why we have seen almost no growth for a year and why the Government have had to revise their borrowing up by £158 billion.
We are seeing just what Labour has been warning of since 2010: the Chancellor is cutting too fast and too deep, and by hitting lower and middle income households the hardest, he is hitting the very people who spend their money most immediately back into the Welsh economy just to keep themselves clothed and fed. His policy is not only deeply unfair; it is economic madness. It is already having a direct effect on the Welsh economy, and we have only seen the beginning of the cuts. Let us make no mistake: over the next three years, the Government will—according to House of Commons figures—take £6 billion out of the pockets of people in Wales, and that will include £800 million in tax credits. Tax credits are money that families who are working hard and trying to do the right thing are given to top up their incomes, and they need to spend that money straight away in order to keep their homes warm and their children fed and clothed.
What else is the Chancellor cutting? He is cutting £7 million from health in pregnancy grants, and £113 million from child trust funds, and the freezing of child benefit is equivalent to a cut of £249 million. He is cutting £209 million from disability living allowance, and £43 million from lone parent benefits. All that is coming out of the Welsh economy, as is the £1.5 billion cut that will result from the use of CPI rather than RPI to uprate benefits, and all that is happening against the background of pay freezes—not to mention the more than £2 billion cut represented by the rise in VAT.
What we need now is a real economic stimulus from the UK Government to back up the Welsh Government’s initiatives on jobs and help for industry, and that is what I ask the Secretary of State to provide. I ask her to look at Labour’s five-point plan for stimulating the economy, and to cut VAT, boost jobs and stand up for Wales by doing something that will really help to get the Welsh economy going. People cannot see any help at all coming from the Secretary of State to us. They cannot see the Secretary of State standing up for Wales, and that is what they would like to see.