Freeports: Wales

Stephen Crabb Excerpts

Tuesday 21st February 2023 Westminster Hall

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

It is a pleasure to serve under your chairmanship, Mr Vickers, and to follow the hon. Member for Aberavon (Stephen Kinnock). I agreed with pretty much everything he said; thankfully, there is no rule against repetition in this place, so I will proceed with my remarks.

First, I would like to put on record my respect and appreciation for my hon. Friend the Member for Ynys Môn (Virginia Crosbie) for securing this important and timely debate, and for the articulate and energetic way she has championed her constituency and a freeport for Wales. In all seriousness, I do not think Ynys Môn has had a stronger voice in the House of Commons in its history as a constituency. I encourage my hon. Friend in the work she does.

Welsh ports have a long history in helping to shape the economic, social and cultural fabric of Wales, as one would expect from a nation with a coastline in the north, west and south. It is three years since the Select Committee on Welsh Affairs examined the proposal for a freeport in Wales. In our report, we noted the positive response from ports around Wales in the written evidence they gave, often citing the potential role of a freeport in regeneration. However, we argued that to make a lasting contribution to the regeneration of the poorest regions and nations of the UK, including in Wales, freeports should be assessed on the economic and social gains they are forecast to bring to local communities. In our view, freeports could help to revitalise the Welsh economy only when they fit with other policies that help Welsh ports and their local communities to thrive.

We noted that many areas of port policy and supporting infrastructure are either devolved to the Welsh Government or are shared responsibilities between the Welsh and UK Governments. We urge the two Governments to work together constructively, especially if a freeport bid is successful in Wales. Crucially, in our report we urged the UK Government not to cap artificially the number of potential freeport sites in Wales, nor to create a Welsh freeport purely for optical or political purposes.

I am pleased we have got to this hopeful and expectant point to hear the outcome of the bidding process for a freeport in Wales. I congratulate the Wales Office on its role in working with the Welsh Government and Ministers across Whitehall to bring us to the point where there could be agreement. There were moments, certainly three years ago, when some of us on the Welsh Affairs Committee were concerned that we might not get to this point, and that the differences in opinion between Welsh and UK Governments would be so great that the freeport policy would not happen in Wales. I am pleased we are at this point; the role the Wales Office played in that was extremely important.

I obviously have a constituency interest. Pembrokeshire is home to the port of Milford Haven, which is one of the UK’s leading energy hubs, hosting a wide range of conventional energy companies such as the Valero oil refinery, the Dragon liquefied natural gas import terminal, South Hook LNG import terminal, the RWE gas-fired power station and the Puma fuel storage site, among others. Those are all located on the Haven waterway. The port of Milford Haven is strategically one of the most important energy hubs in the UK, and the infrastructure it hosts plays a critical role in our national life. Undoubtedly, that port has played an integral role in shaping Pembrokeshire’s local economy through the high-quality job opportunities that those energy companies have provided to local people for many generations.

Those industries are changing, and need to change. The hon. Member for Aberavon made the point that recent events have highlighted the need for our energy mix to diversify, and our demand for home-grown renewable energy has never been greater. Right now we have a unique opportunity to build on that heritage and the excellent skillset in Pembrokeshire to use vacant brownfield sites for the new and exciting energy revolution that is just in front of us.

The port of Milford Haven is in prime position to shift from being one of the UK’s leading conventional energy hubs to being one of the UK’s leading renewable energy hubs. The decarbonisation of Wales’s primary industrial cluster, which stretches from Milford Haven all the way to Port Talbot and further east across the south Wales coast, is the prize in front of us. That decarbonisation has already begun, as we have already heard this morning, and will make a significant contribution to helping the UK meet its net zero targets.

In 2019 the Conservative party stood on a manifesto to deliver at least one freeport in Wales. Fast-forward four years and the necessary steps have been taken to ensure that that ambition becomes a reality. The Welsh and the UK Governments will jointly evaluate bids and select a freeport for Wales in early spring. As we know, for politicians “early spring” can mean anything, but I hope that it means in the days and weeks ahead. We have a prime opportunity, if the Government want to take it with St David’s Day just around the corner, for a really significant announcement that would make a difference for people and communities across Wales. We therefore expect to receive confirmation of the winning bid imminently.

I want to briefly put on the record why I think the Celtic freeport bid should be the frontrunner in this race—it is a competitive process. The Celtic freeport bid is a private-public sector partnership led by Associated British Ports, Neath Port Talbot Council, Pembrokeshire County Council, and the port of Milford Haven. The bid has been backed by prominent businesses across Wales as well as numerous MPs from all parties and Members of the Senedd as well, demonstrating the evolution of a collective consensus that is necessary to drive forward the Celtic freeport vision. The bid goes far beyond party political lines, with a broad recognition of the wide-ranging benefits that the Celtic freeport will bring to Pembrokeshire, Port Talbot and the whole of south Wales. That is why I have been working so closely with the hon. Member for Aberavon to help build momentum behind that important bid.

It was encouraging to see so many MP colleagues from across different parties attend our recent drop-in event to hear more about the exciting potential of the bid. I was delighted that so many of my colleagues put pen to paper that day to confirm their backing for it. If we are awarded freeport status, more than £5 billion of new investment will be unlocked, potentially creating more than 16,000 new high-quality green jobs across the south and west Wales economy. Furthermore, securing freeport status across the key sites of Milford Haven and Port Talbot will enable them to begin their journey towards energy diversification through, as we have already heard, the emergence of the new floating offshore wind technology.

As I explained in my debate on floating offshore wind in this Chamber last October, offshore floating wind represents a major, exciting new opportunity for the UK to tackle pressing issues: jobs and skills regeneration, wholesale energy prices, energy security, levelling up and, as I have said, net zero targets. The UK Government have set ambitious targets to deliver floating offshore wind in the years ahead, and both Milford Haven and Port Talbot have already been identified by leading developers as key locations for the early development of this new industry for Wales. Hopefully Milford Haven will be a hub for operations and maintenance, with Port Talbot at the forefront of assembly and manufacture.

The potential to unlock a UK market in the construction, maintenance and operations of floating offshore wind projects could be worth more than £54 billion in the decades ahead. That is the prize in front of us. It is clear that the establishment of a freeport across the sites at Milford Haven and Port Talbot will enable this exciting renewable vision to flourish. The war in Ukraine, coupled with rising energy prices, has underlined the urgent need for the UK to become less energy dependent. The need to diversify our energy mix has never been more apparent as the dial shifts to the development of green, sustainable energy. Floating offshore wind represents the next big renewable opportunity for Wales. With the expertise and heritage in the Milford Haven waterway, and the skillset and industry in Port Talbot, these two locations at the heart of the Celtic freeport bid are ideally suited to supporting the industrial-scale deployment of floating offshore wind.

Freeport status would be hugely advantageous in that process as it would allow this new green vision to flourish, with the tax breaks, simplified customs procedures and streamlined planning processes helping to ease the transition from conventional to renewable energy. In turn, there is a potentially enormous investment to be unlocked in the supply chain, and that is the prize here. The UK has made enormous progress in the fixed-bottom offshore wind industry and has taken strides in expanding that deployment, but the one thing that did not happen in was we did not create strong domestic content for the UK. We did not capture a bigger share of the full economic value of offshore wind as we should have done. We now have the opportunity with floating offshore wind to get it right and to deploy these structures to give us clean energy in a way that creates long-term jobs and training opportunities in our communities.

[Stephen Kinnock]

The right hon. Member is making an excellent speech. Does he agree that it is vital that the Crown Estate sets up a licensing process that guarantees localised supply chains and that there should be penalty clauses in the process, so that developers will be held to account?

[Stephen Crabb]

The hon. Gentleman makes a crucial point. He is absolutely right that the Crown Estate must ensure those contracts have teeth. That will be crucial to ensuring that developers deliver on their commitments because, as he knows, it is one thing for them to speak to us politicians and tell us about all the good things they will do in our communities, but actually making sure they do them when push comes to shove is another.

The other part of the equation is ensuring that we get the contracts for difference right and ensuring that the financial architecture around floating offshore wind is the right one to enable that investment in the UK and Welsh economies. Of course, there is a potential first-mover advantage waiting for the nation that makes the biggest and earliest strides to deploy floating offshore wind at an industrial scale. The Welsh Affairs Committee was recently in the US and met with a floating offshore wind developer there who was also looking to develop in the Celtic sea. They have secured seabed leases off the coast of New York and in California. There is a global race to be the first nation to see serious industrial-scale deployment of offshore wind, and I believe it should be Wales and the UK that does that.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

Wales, indeed. Does the right hon. Gentleman join me in wondering whether Wales would be able to put better procurement requirements in place and ensure that the benefits are accrued more effectively to Wales if the Crown Estate, as in Scotland, was devolved to Wales?

[Stephen Crabb]

It pains me to disagree with the right hon. Lady, but the debate about devolving the Crown Estate is a red herring. It is a question that I have explored with potential developers and something I have discussed with the Crown Estate and other potential players in this field. That will not be the critical intervention to ensuring this vision is realised in the way that we all hope. I appreciate some of the arguments she is making about the devolution of the Crown Estate, and she has made them articulately before in this Chamber, but, as I say, it is something of a red herring.

The freeport intervention would be a critical intervention in helping to unleash and launch this new, exciting industry for Wales. I hope that when the UK Government and the Welsh Government sit down together to assess the bids, they will look at the strength of the industrial proposition behind the Celtic freeport bid. I grew up in Wales and have been a politician in Wales long enough to have seen a lot of failures of economic development around Wales. So much public money has been thrown at different schemes and interventions over the years—so often they seem to have the word “park” in them: food park, science park, tech park and so on—that never really achieve the vision and potential that politicians hoped for when they were spending taxpayers’ money because very often there is no real substance behind them.

I hope that in making this freeport intervention, the Government recognise that they need to work with the grain of the private sector and industry and recognise where real, substantial projects are already starting to happen—in Port Talbot, the port of Pembroke and Milford Haven—and capture that and work with it. That is what will deliver real economic and social benefits for our communities in the way that freeports are intended to do. If the UK Government want to improve our energy security, help us to take a big step towards meeting our net zero ambitions and invest in creating good-quality jobs and training opportunities in our constituencies—that is the essence of levelling up and rebalancing the economy, as it would mean that young people do not have to leave their communities in Wales to work elsewhere, allowing them to stay and be part of those communities, to build and to raise their children there—they will recognise the strength of the Celtic freeport bid and what it proposes. I really hope that the Government take this opportunity and give us the freeport status that we are looking for to help to create this new industrial revolution.

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[Stephen Crabb]

Just to clarify, that remark about “optical or political purposes” was a quote from the Welsh Affairs Committee report. It was not just a personal opinion.

[Liz Saville Roberts]

I stand corrected and welcome that, but I think there is a really important question here for the Minister, and I press him for a response. My understanding is that for Wales to have two freeports, two exceptional cases have to be made. Now that we appear to be approaching the time when announcements are going to be made, it is important to know what constitutes an exceptional case, because we have two communities—three if we include Port Talbot—that have great expectations. Can the Minister clarify whether the bids are being assessed by both the Welsh and UK Governments? Will the Welsh Government have a meaningful say on whether the two bids meet the requirements? I would appreciate a response on that. Given the initial revelation that a lower level of funding was being allocated for a freeport in Wales, if both freeport applications are successful, will they both receive £26 million in initial funding?

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[Dr Davies]

The right hon. Member makes a good point. Clearly, the Welsh Affairs Committee has considered these issues in detail. They are important to me, and the role of the Wales Office is to liaise with the Department for Energy Security and Net Zero, as it is now called, to ensure that grid capacity meets aspirations. I assure her that I hope to have that influence.

[Stephen Crabb]

I reiterate the point that the right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts) made about grid capacity. If we read in detail the evidence received by the Welsh Affairs Committee, we see that it is very clear that when it comes to investment in the grid, business as usual is simply not going to cut it. I appreciate that the Government are making efforts to secure more timely investment, but if we are to meet the targets and aspirations we have been talking about, we need to see a sea change.

[Dr Davies]

I take that point on very much board and thank my right hon. Friend for all his efforts in that regard.

Let me take the opportunity to outline other core elements of the Government’s levelling-up agenda. Wales is front and centre of our plans to level up the whole of the UK, and areas across Wales are already benefiting from more than £1.7 billion of local growth funding. From large-scale transport improvements to regenerating town centres and refurbishing cultural assets, the levelling-up fund will deliver lasting improvements in local communities across Wales, giving people renewed pride in their local areas. Ynys Môn alone is receiving £17 million from the levelling-up fund for the cultural regeneration of Holyhead town centre. I was pleased to visit a few weeks ago and see the efforts being made to ensure that people who use the port see all that Holyhead has to offer.

In total, the Government are investing more than £208 million in 11 projects across Wales through the second round of the LUF. That is almost 10% of the total UK allocation and builds on the £120 million that the Government invested in Wales in the first round of the fund. It is far more than Wales would have received through a Barnettised formula and is testament to the dedicated work of local authorities across Wales, which developed high-quality applications. The Government are also investing more than £790 million in Wales’s four city and regional growth deals. The deals are starting to deliver real change on the ground, from the Swansea Arena to investment in the digital signalling processing centre at Bangor University.

Furthermore, £2.6 billion has been allocated to places across the UK through the UK shared prosperity fund. Of that, £585 million has been allocated to Wales, including more than £126 million for north Wales. This trailblazing new approach to investment and the empowerment of local communities to level up and build pride in place will see direct investment in three local priorities: communities and place; support for local businesses; and people and skills. The funding is now in the hands of Wales’s four regional partnerships, through which local leaders are empowered to decide how best to invest the funding to better promote local growth, help to regenerate local economies and build a better future.

Oral Answers to Questions

Stephen Crabb Excerpts

Wednesday 23rd November 2022 Commons Chamber

[Mr Speaker]

I call the Chair of the Select Committee, Stephen Crabb.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

At the Welsh Affairs Committee this morning, we heard from the Minister for Energy and Climate on the enormous potential of floating offshore wind to contribute to UK energy security. On a day when Port Talbot and Milford Haven are launching their joint freeport bid to deliver this new industry, I urge my hon. Friend to throw his weight behind unleashing the potential of floating offshore wind in the Celtic sea.

Oral Answers to Questions

Stephen Crabb Excerpts

Wednesday 19th October 2022 Commons Chamber

[David T. C. Davies]

I am afraid that I did not hear all of the question, but I believe the hon. Gentleman mentioned fuel poverty. I remind him again that the Government are doing everything possible to ensure that people in this country can access the cheap gas, cheap electricity and cheap petrol that they need. It is members of his Government in Scotland who are doing their best to prevent that from happening.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

In welcoming the contributions from our friends from the Scottish National party to Wales questions, may I politely remind them that in March 2020 the Government stepped in to save thousands of businesses in every single one of our constituencies, protecting hundreds of thousands of jobs? Does that not demonstrate the value of staying part of a strong United Kingdom, and that the Government do not walk away from serious challenges but meet them head on?

[David T. C. Davies]

My right hon. Friend makes an excellent point. I could not put it better myself. The Government will stand up for the Union, and for the least well-off in society.

Oral Answers to Questions

Stephen Crabb Excerpts

Wednesday 6th July 2022 Commons Chamber

[Mr Speaker]

We now come to the Chair of the Select Committee, Stephen Crabb.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

At the end of the Great Western line in my constituency is Milford Haven, the UK’s most important energy port and the largest town in my constituency. Its railway station is a disgrace. Does the Secretary of State agree that a project to upgrade Milford Haven train station would be an ideal round 2 levelling-up fund bid, and will he look favourably on any such bid from Pembrokeshire County Council?

[Simon Hart]

My right hon. Friend and neighbour has raised the question of Milford Haven station a few times, and I am no stranger to it either. Although I am not allowed to express a preference for individual levelling-up bids, that is precisely the type of infrastructure improvement bid that the levelling-up fund was created for, so if he and the local authority can put together some compelling evidence, I am sure that those who are in a position to judge it will look on it favourably.

Support for the Welsh Economy and Funding for the Devolved Institutions

Stephen Crabb Excerpts

Tuesday 5th July 2022 Commons Chamber

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

It is a pleasure to open this estimates day debate. We go from having debated one of the largest items of expenditure on the Government’s books in the previous debate to debating perhaps one of the smallest of the Whitehall estimates. I hope that today’s debate will provide a useful opportunity for a wide-ranging discussion about the current challenges facing all of our constituencies in Wales and the steps being taken by the UK Government and also in Wales by the Welsh Government to address them.

One of the things I have become more convinced about, the longer I am a Member of this place, is that we need to spend more time debating Welsh matters and not less. We have our annual St David’s day debate and we sporadically have the opportunity upstairs to have a Welsh Grand Committee, although that is perhaps a bit too knockabout for the taste of some Members, so using the estimates day route to secure a debate is useful and I am grateful to see other Welsh Members participating today. I am particularly grateful to those colleagues who supported the bid application.

[Hywel Williams (Arfon) (PC)]

Apart from the debates that the right hon. Gentleman has mentioned, there is also the work of the Welsh Affairs Committee, of which I was a member for many years. I understand that the Committee published its report on the benefit system in March. Has he had any response from the Government to that report?

[Stephen Crabb]

The Government have responded to the report, and we will be publishing our response to the Government’s response shortly. I would encourage the hon. Member to keep a lookout for that.

Our report into benefits in Wales is one of three of the Committee’s reports that has been flagged on today’s Order Paper as being relevant to this debate. We could have flagged other reports, as the Committee has done a lot of work that is relevant to the broad discussion that we want to have this afternoon. We continue to be a very busy Committee, and we cover a lot of ground. I am grateful to colleagues for their regular attendance at the Committee and for their spirit and enthusiasm. I think we do some good work as the Welsh Affairs Committee.

I should also say how grateful we are to the Wales Office Ministers, who give us a lot of their time providing oral evidence. We are also grateful to Welsh Government Ministers—not just the First Minister but other Members of the Welsh Government—who have no obligation to appear before our Committee but who nevertheless choose to do so. That all helps to make the inquiries that the Committee undertakes particularly useful.

Turning to the specific estimate in front of us, I would encourage Members to look at the very helpful House of Commons Library note that has been produced, which explains in much more detail, and far more effectively than I could, how the estimate has been compiled. It also outlines the factors underlying some of the changes, compared with last year’s spending plans. Clearly, we are continuing to go through an extraordinary period, economically, in the life of our nation, and that is very much the backdrop to today’s debate. If this debate had happened 18 months or two years ago, we would have been debating the impact of the pandemic. We are now in a new phase, and the cost of living is the No. 1 issue facing many of our constituents, as the previous debate highlighted. Personally, I am extremely supportive of the measures taken by the UK Government to support families through the cost of living crisis. The measures that the Chancellor of the Exchequer brought forward were broadly in line with what many of us had been calling for. They represented a major intervention that has been broadly welcomed by many poverty-fighting charities and campaign groups.

There are points that we could debate. I think the preceding debate covered those adequately, but I add my voice to that of the Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Sir Stephen Timms), who has just left his place, on the need to do something to address the five-week wait for universal credit claimants. I attended the breakfast in Westminster Hall that was referenced earlier this afternoon as a guest of the Trussell Trust. I sat next to someone who had found themselves in financial crisis and having to make a claim for universal credit. The thing that she struggled with, alongside her mental health battles, was the five-week wait and falling immediately into debt. I encourage members of the UK Government to look at that to see how we can improve the system.

Beyond addressing the immediate cost of living crisis, I am particularly motivated by a desire to look at longer-term ambitions for improving the economy in Wales. That is why I support the UK Government’s levelling-up ambitions and their desire to see all parts of the country rise on a tide to be more in line with one another in the contribution that they make to the UK economy and the share of wealth and prosperity that people in different parts of the country enjoy.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

The right hon. Gentleman mentions levelling up. I note what the Government are doing in terms of the funds that are coming to Wales, but there is a shortfall of nearly £1 billion compared with what Wales would have received. In 2019 the Government committed as a minimum to match what had been provided to Wales under EU structural and investment funds. That commitment has not been met; we have seen a shortfall in both rural funding and other funding. Does the right hon. Gentleman agree that that is a major problem when we look at Wales’s future challenges and structural needs?

[Stephen Crabb]

We have discussed that very point at the Select Committee; indeed, just a fortnight ago, the Secretary of State was questioned on it by colleagues on the Committee. We know from previous arguments that it is not always easy to pinpoint the exact details of the totality of spending in Wales, but the general argument that Wales does not receive a “fair share” of funding is a constant theme in Welsh politics. I imagine that will continue long after we have all moved on from this place.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

rose—

[Chris Bryant (Rhondda) (Lab)]

rose—

[Stephen Crabb]

I will give way to the right hon. Lady and then to the hon. Gentleman—I am sure I have just opened the door to a whole host of problems.

[Liz Saville Roberts]

I am grateful to the right hon. Gentleman for his work on the Welsh Affairs Committee and for bringing the debate forward. We are talking about levelling up. One issue is that the Crown Estate is devolved in Scotland but not in Wales. Does he agree that, with the Celtic sea floating wind investment in south-west Wales in the offing, Wales needs the means to equip itself to grow and not just to be dependent on handouts from Westminster, which is one of the ways that levelling up is explained? Consistency between Wales and Scotland would enable Wales to grow its own economy and, most significantly, the local supply chains that would go alongside that sort of investment. Wales could manage that most effectively for Wales’s need.

[Stephen Crabb]

I do not agree that devolution of the Crown Estate in Wales is necessary to achieve the birth and success of a floating offshore wind industry, which so many of us want to see. We have a fabulous opportunity opening up in the Celtic sea, as confirmed by the Crown Estate today. There are lessons that can be learned from the ScotWind process, but for me, devolution of the Crown Estate is a red herring.

[Chris Bryant]

My bigger concern is that the way the Government have structured all these different funds that are supposedly for levelling up is based on a competition. I think that leads to project-itis, with people putting together projects to fit the schemes, rather than a strategic look at what is really needed across some of the poorest communities in south Wales. For my own money, the single most important thing that we could do is try to enable far more people in the valleys to build up their own businesses from scratch until they employ perhaps five or 10 people. That is the way we will really get people into meaningful work.

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[Stephen Crabb]

I agree with the hon. Member, who pre-empts a point that I was going to make about levelling up. We want interventions that genuinely move the dial. If there was a weakness in the first round of funding, it was the very tight timescales, with local authorities told to get on with it very quickly. Indeed, the Public Accounts Committee recently drew attention to some of the weaknesses in that process.

We want projects that move the dial, but I say gently to the hon. Member that I remember my time as Welsh Secretary, and never a week went by without an Opposition Member knocking on the door of the Wales Office and asking whether there was not a pot of money somewhere in the UK Government to support a project in a constituency in the valleys or elsewhere in Wales. For the first time, the UK Government are making available pots of money that allow us to be involved in partnership with our local authorities on the ground, working to identify solutions to needs. That is tremendously exciting, and I encourage him to be an enthusiastic participant in that. However, he makes an important point about the broader economic context and things that genuinely move the dial.

If there is one part of the United Kingdom that is crying out for meaningful levelling up, it is Wales. I dislike very much the “older, sicker, poorer” narrative, which gets deployed time and again when we discuss the economy in Wales. Too often, it is used as an excuse for mediocrity, complacency and tolerance of poor performance, rather than as something that drives us in Wales to say that we are not going to carry on repeating the same old mistakes of the past. But there is truth behind the narrative. Look at economic output in Wales: in 2020, it was around 3.5% of all the economic output in the UK. That is lower than Wales’s share of the UK population, which is 4.7%. Wales is not punching its weight economically. Economic output per head in Wales is around £24,000, and the UK-wide average is more than £32,000. That is quite some gap.

During the decade from 2010 to 2020, annual economic growth in Wales averaged around 0.8%, similar to the UK average. We could be complacent and say, “Well, we’re in line with the UK average,” but that is not good enough. If we are going to close the economic gap in Wales, we need to grow significantly faster than the rest of the UK. For me, that is really what the objective of levelling up should be. What are the interventions that can move the dial and help the Welsh economy get to another level where we see more, better jobs created that pay more money and are more sustainable for our communities?

I draw Members’ attention to the Office for National Statistics population statistics that came out—

[Liz Saville Roberts]

The right hon. Gentleman is very kind to take a second intervention. I am sure that the Welsh Affairs Committee is considering the need for interventions and investment that would shift the dial. Does he agree that improvements to the National Grid—in particular, an interconnector between north and south Wales, as proposed by National Grid ESO—really would shift the dial? The potential to feed more into the grid, and the generation that we could then have in Wales, would make such a difference to the economy.

[Stephen Crabb]

I agree with the right hon. Lady’s point about infrastructure—the Committee is looking at that at this very moment—but there is a broader point. Right across different forms of infrastructure in Wales, we are decades behind other parts of the UK. In our rail network and parts of our road network, there is so much work to be done to create the basic infrastructure that can support a modern, 21st-century economy. We all want to protect our own little corners of Wales and keep them nice and quaint. The truth is that if we are happy to stay at that level, we will find that all the properties are bought up by second home owners and there are very few high-quality jobs and training opportunities to keep our young families living there.

That takes me to the point that I was going to make about the population data. There is a real problem when we see a significant drop in the population in places such as Ceredigion—those Welsh-speaking communities in western Wales. That does not bode well for the future. We have parts of Wales with declining populations; overlay the ageing demographic, and that points to some deep-seated underlying challenges. It should be the ambition of us all, whatever our political colours, to address that.

I will make one more point and then let other Members get in on the debate. I come back to the issue of floating offshore wind in the Celtic sea, so let me speak parochially for a moment. In my constituency, that represents one of the most important and valuable economic opportunities that is emerging, as was confirmed today in the statement by the Crown Estate. If we are to make the most of this opportunity in Wales and not look back on it as another missed chance to do something significant—if we are to capture its full economic value—some big things need to start happening. We need the port infrastructure in Wales, particularly in south Wales, that can handle these mammoth turbines that are going to be built. We need work on the design of the contract for difference scheme, because some of the developers have real concerns when they look at the Celtic sea opportunities and what is already being leased out in Scotland, and questions are being raised. Will the Scottish economic opportunity outmuscle what is available in Wales? There is a real issue associated with the design of the CfD scheme.

As for the supply chain, we need to ensure that we have jobs and training opportunities in Wales for Welsh people, and that all the manufacturing, servicing and maintenance of the gargantuan new turbines that will be floated off the coast is not done elsewhere. Let me leave that thought with the Secretary of State. He and I have talked about these issues a lot, and I know that we are very much on the same page, but I still think there is work to be done within the UK Government and the Department for Business, Energy and Industrial Strategy to make that happen.

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[Robin Millar]

The right hon. Lady’s intervention gives me an opportunity to make a really important point. I think that we have a fundamentally different view of the world. Effectively, she is referring to a deficit model, in which the deficit from poverty and need is something that must be filled. I come from a different perspective. I hold to what I would call an asset-based model. Yes, there are problems, gaps and shortages, but the way to deal with them is not simply to try to fill the deficit; it is to engage with and use the assets that are there.

I have spoken against the tourism tax. I feel very strongly that a tax placed on visitors who stay in hotels does nothing to address problems, or the behaviours of those who come to the area and wild camp, or do not even stay overnight, and who do not spend money in the local economy. I understand the sentiment behind the tax, but its motive is to make the money to fill or fix the deficit. We should instead ask: how do we work with communities and businesses to change the behaviour of visitors, address their experience, and address inappropriate behaviours in our area?

Our frustration comes from seeing that we have talent, but limited opportunities. That is compounded by our having one of the lowest income outputs of anywhere in the UK. On top of that comes frustration with some of the responses of the Welsh Labour Government. I say that in all sincerity. In a recent letter to leaders of local authorities in Wales, the Welsh Government Minister for the Economy wrote that

“the Welsh Government is unable to endorse the approach that the UK Government is taking on the Shared Prosperity Fund. This means, as we have consistently stated to the UK Government, that the Welsh Government will not deploy our own resources to implement UK Government programmes in Wales which we consider to be flawed.”

I, like many others, am frustrated by this approach. Surely it is counterproductive to second-guess how a UK Government funding stream for parts of the UK will be handled.

[Stephen Crabb]

My intervention is in response to the right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts), who argued that Wales needs more tools. The tools that we have already given to the devolved Welsh Government have not been fully used. I give the example of income tax. Does my hon. Friend the Member for Aberconwy (Robin Millar) agree that one thing we could do in Wales is cut the top rate of income tax—that is something for which the Welsh Government have responsibility—and attract high-value tech entrepreneurs and their families to Wales, which would create more jobs and businesses?

[Robin Millar]

I thank my right hon. Friend for making that point. I could not agree more. Contrast that deficit view, which seeks to fill, with an asset-based view, which seeks to grow, encourage and stimulate that kind of economic activity.

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[Stephen Kinnock (Aberavon) (Lab)]

It is a real pleasure to follow the hon. Member for Ceredigion (Ben Lake), and I congratulate the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) on securing this important debate.

The people of Wales need answers from this Westminster Government about the cost of living crisis that they are facing right now, because the Conservative Government’s response to the crisis has been deeply disappointing. They are out of touch, out of ideas and out of excuses. They delayed bringing in the windfall tax on the energy giants; we in the Opposition had to drag that policy out of them. Meanwhile, they also refused to deliver an emergency Budget and they are the only Government in the G7 who are raising taxes during a cost of living crisis.

Hard-pressed households and businesses need support in these profoundly challenging times. Labour has a plan to tackle the cost of living crisis. We would cancel the national insurance contributions rise, which comes at the worst possible time and will do nothing to fix the Tory’s social care crisis. We would cut VAT on home energy bills. We would cut the red tape that has been created by the Prime Minister’s botched Brexit and we would implement policies to buy, make and sell more in Britain, particularly through commitments such as the £3 billion green steel fund to support our steel industry as it transitions to net zero.

For an object lesson in the difference that a Labour Government in Westminster would make, we need just to look at what the Welsh Government are delivering for Wales. Welsh Labour has delivered a £51 million household support fund, which was announced in December 2021. That package of support is targeted at people who need help the most. The Welsh Labour Government have doubled the winter fuel support payment to £200, which is already helping almost 150,000 people across Wales. Free prescriptions continue in Wales, helping households to keep more of their hard-earned money, whereas prescriptions in England currently cost £9.35 an item. The average band D council tax bill in England is £167 more than it is in Wales, totally undermining the argument made by the hon. Member for Clwyd South (Simon Baynes). Even with the UK Government’s council tax rebate, which was just announced, households in Wales still pay £17 less than in England. Wales already has the £244 million council tax reduction scheme, which helps more than 270,000 households with their council tax bills. Some 220,000 households in Wales pay no council tax at all, thanks to the Welsh Labour Government’s interventions. The Welsh Labour Government have committed to providing free school meals to all primary school pupils. An extra 196,000 primary schoolchildren will benefit from that offer.

All that has been underpinned by a Welsh labour market that is significantly stronger than the UK labour market. Welsh unemployment levels are lower than those in the UK at 3.5%.

[Stephen Crabb]

I will challenge the hon. Gentleman on his complacency about the labour market figures in Wales. Yes, in Wales, unemployment—in its narrow definition—is lower than the UK average, with 53,000 jobseekers in Wales, but more than 440,000 working-age people are economically inactive in Wales. That is the major employment and welfare challenge of our time, and the figure is worse than the UK average in a Welsh context.

[Stephen Kinnock]

Perhaps if the UK Government had a proper industrial strategy that would grow our manufacturing base, rather than having allowed it to go to the wall since 2010, we would be creating high-paid jobs and adding value to our economy and productivity. We face a productivity crisis in this country, created by successive Conservative Governments since 2010.

There has been a strong performance by the Welsh Government, who have made a commitment that

“no one would be held back or left behind…in a recovery that is built by all of us.”

We have seen the creation of the young person’s guarantee—the offer of work, education, training or business start-up help for all under-25s—and ReAct Plus, which will provide practical and bespoke employment support as unique as the person looking for work. The ReAct Plus programme will offer up to £1,500 for training, £4,500 to help with childcare costs and £300 for travel costs. Welsh Labour is also investing £8 million to continue employment services, helping people recovering from physical and mental ill-health and substance misuse to get back into work and, crucially, remain in work. Through the young person’s start-up grant, Welsh Labour will invest £5 million to support 1,200 young people to start their own business.

That is what Labour in power looks like: a Welsh Labour Government backing Welsh workers, Welsh families and Welsh businesses to thrive, protecting our people from the worst excesses and failures of this Tory Government, who are letting people down with their incompetence and indifference.

--- Later in debate ---

[Stephen Crabb]

With the leave of the House. It is apt to see you in the Chair, Mr Deputy Speaker, given your Welsh heritage.

Again, I am grateful to the Backbench Business Committee—the Chair, the hon. Member for Gateshead (Ian Mearns), is in his place—for selecting this topic for debate this afternoon. I thank all the participants, who have made it a thoughtful, intelligent and engaging debate. We have covered a lot of ground and we have covered many different subjects well. We have disagreed well and we have exchanged some important ideas about the future of Wales. I hope that people watching the debate will have seen that one thing that unites Members on both sides of the House is that we are Members of Parliament for Welsh constituencies who share a love of Wales and a deep love and connection with our communities. We all want the best for our communities in Wales.

Finally, in the next Parliament, the number of MPs from Wales will be significantly reduced, so it will become even more important to have more opportunities on the Floor of the House to debate issues for Wales. Many other parts of the country are fighting hard for resources and we must do our bit in Wales to fight harder in future.

Very finally, I thank again the Clerks of the Welsh Affairs Committee and their team of staff who do a simply superb job to support the work of the Committee.

[Mr Deputy Speaker]

I love “finally” and “very finally”.

Question deferred until tomorrow at Seven o’clock (Standing Order No. 54).

Department for Business, Energy and Industrial Strategy

Oral Answers to Questions

Stephen Crabb Excerpts

Wednesday 9th February 2022 Commons Chamber

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

Devolution of the Crown Estate is a total red herring, and it so cynical of nationalists to turn every issue into an anti-United Kingdom process row. Does my right hon. Friend agree that floating offshore wind represents a hugely important opportunity for Wales, particularly for the port of Milford Haven in my constituency—Milford Haven is shared by his constituency—and will he assure the House that he and his colleagues at the Department for Business, Energy and Industrial Strategy are doing everything to ensure that Wales and Pembrokeshire benefit from the opportunities of renewable marine energy?

[Simon Hart]

My right hon. Friend is right; I met the Crown Estate last week and had exactly that conversation. I have to say that it was an exciting, interesting, innovative conversation about all the possibilities that he mentions, which exist across the whole UK but particularly in the Celtic sea. I repeat what I said earlier: the emphasis and impetus come from investors, members of the public and port authorities, not from nationalists who just wish to look at everything through the prism of their own power base.

Strengthening the Union as it Relates to Wales (First sitting)

Stephen Crabb Excerpts

Tuesday 18th January 2022 General Committees

[Simon Hart]

I will give way to my right hon. Friend the Member for Preseli Pembrokeshire.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

May I draw my right hon. Friend back to the point about the furlough scheme, in the context of the strength of the Union, because I think the point about that scheme is even better than he alluded to? The truth is that the scheme was a much bigger success than anybody had anticipated. Far from there being a crisis of unemployment at the end of 2021—as so many Opposition Members had predicted—when the furlough scheme was unwound, we actually had a boom in job creation and no employment shortage up and down the country, so full credit to the Treasury and the decision making of the Chancellor and his colleagues.

[Simon Hart]

My right hon. Friend is right. The decision-making point that he makes is particularly apposite, because these decisions were being made at breakneck speed in unbelievably unpredictable conditions and under significant pressure, and they turned out to be the right calls. They were made for the right reason, at the right time. It is no coincidence that the unemployment figures now show that there are over 400,000 more people in work than there were before the pandemic.

--- Later in debate ---

[Ben Lake]

Rwy’n ddiolchgar iawn i’r Gweinidog am ei ymyriad. Mae Plaid Cymru wedi cydnabod o’r cychwyn cyntaf y byddai rhai o welliannau HS2—pe baen nhw’n cael eu gwireddu yn llawn, wrth gwrs—yn fuddiol i ogledd Cymru. Ond os edrychwn ni at Gymru yn ei chyfanrwydd, mae’r adroddiad a gomisiynwyd gan y Trysorlys ei hunan yn dangos y bydd colled net o £150 miliwn y flwyddyn mewn allbwn economaidd. Mae’n rhaid i ni ystyried yr effaith mae hyn yn ei gael a bod y Trysorlys yn gostwng y ffactor cymaroldeb a’r gwariant ar gyfer yr Adran Drafnidiaeth yn y datganiad cyllid.

Dyna pam rwyf am annog Aelodau yma heddiw i wrando ar argymhelliad y Pwyllgor Materion Cymreig y dylai HS2 cael ei adnabod fel prosiect sy’n buddio Lloegr yn unig. Fe fyddwn i’n mynd yn ymhellach, ac annog pobl i gefnogi datganoli cyfrifoldeb dros y rheilffyrdd i Senedd Cymru. Yn wir, yn ôl Canolfan Llywodraethiant Cymru, pe byddai’r cyfrifoldeb hwn eisoes wedi ei ddatganoli i Gymru, byddai buddsoddiad ychwanegol o hanner biliwn o bunnoedd wedi bod rhwng 2011 a 2020.

Enghraifft arall o ddiffyg yn y setliad presennol yw triniaeth yr Undeb o Ystad y Goron yng Nghymru. Er gwaetha’r ffaith y datganolwyd rheolaeth Ystad y Goron i’r Alban yn 2017, mae San Steffan yn cadw rheolaeth dros yr ystad yng Nghymru. Mae hyn yn golygu bod refeniw o adnoddau naturiol Cymru yn cael ei drosglwyddo i’r Trysorlys yn hytrach nag aros yn y cymunedau lle cânt eu cynhyrchu. Ddoe, fe welon ni bod Ystad y Goron yr Alban wedi cwblhau ei arwerthiant diweddaraf o hawliau gwely’r môr i ddatblygwyr ynni gwynt. Trwy 17 o brosiectau, mae’r Alban wedi sicrhau bron i £700 miliwn ac wedi denu consortiwm byd-eang o ddatblygwyr i fuddsoddi ymhellach yng nghadwyn gyflenwi yr Alban. Er bod ein hadnoddau adnewyddadwy ni yn llai yng Nghymru, dangosodd y rownd ddiweddaraf o arwerthiannau yr hyn sy’n bosibl yn ein hadnodd ynni gwynt morol. Gwelwyd gwerth portffolio morol Cymreig Ystad y Goron yn cynyddu’n sylweddol o tua £50 miliwn i dros £500 miliwn.

Mae Plaid Cymru wedi gwthio ers tro am ddatganoli Ystad y Goron ac rwy’n falch cael dweud bod y cytundeb cydweithredu rydym wedi’i gyrraedd gyda Llywodraeth Lafur Cymru yn cynnwys sicrhau ei ddatganoli fel prif amcan.

(Translation) I am grateful to the Minister for his intervention. Plaid Cymru has recognised from the very outset that HS2 improvements, if they were fully realised, would be beneficial to north Wales. For Wales in its entirety, however, the report commissioned by the Treasury shows that there will be a net loss of £150 million a year in economic output. We have to consider the impact all of that, and the fact that the Treasury depleted the comparative factor for Department for Transport expenditure in the finance statement.

That is why I encourage Members to listen to the Welsh Affairs Committee recommendations that HS2 be recognised as a project that benefits only England. I would go a step further and encourage people to support the devolution of responsibility for the railways to the Senedd. According to the Wales Governance Centre, if that responsibility had already been devolved to Wales, there would have been additional investment of half a billion pounds between 2011 and 2020.

Another flaw in the current settlement is the treatment in the Union of the Crown Estate in Wales. Despite the fact that control of the Crown Estate was devolved to Scotland in 2017, Westminster retains control of the Crown Estate in Wales, meaning that revenue from natural resources in Wales is transferred to the Treasury rather than remaining in Wales. Yesterday, the Crown Estate in Scotland completed its latest sale, with 17 projects that will bring in £700 million, and attracted a global consortium of investors to invest further in supply in Scotland. Even though our renewable resources are fewer in Wales, that latest round of sales shows what is possible in our marine energy. Welsh Crown Estate marine energy increased in value from £50 million to more than £500 million.

Plaid Cymru has pushed for some time for the devolution of the Crown Estate, and I am pleased to say that the agreement we have reached with the Labour Welsh Government includes devolution as one of its main objectives.

[Stephen Crabb]

Will the hon. Gentleman give way?

[Ben Lake]

I will, but it will be the last time.

[Stephen Crabb]

The hon. Gentleman is making a really interesting point about the Crown Estate and the Scottish Government’s announcement yesterday about the slew of investment going into offshore wind projects. He will know, as he also serves on the Welsh Affairs Committee, that we have the same opportunity in west Wales. Why does he think that devolving the Crown Estate to Wales will unlock investment in the Welsh offshore wind fields faster? What is different about an independent Welsh Crown Estate that it would change that?

[Ben Lake]

The right hon. Gentleman raises an important point. Simply put, I think we will see quicker action. When action is taken, we can realise some of the abundant potential we have on the coast of his wonderful constituency in south-west Wales. We will see those benefits being retained closer to the community that he represents and closer to the communities in which the revenues are generated.

Rydw i’n brysur rhedeg allan o amser, felly wnai beidio cymryd unrhyw ymyriadau pellach, ond hoffwn sôn am ddwy broblem arall sydd yn codi o’r setliad presennol. Yr un pennaf yw’r hon sy’n ymwneud â’r system gyfiawnder. Tra bod cyfiawnder yn Lloegr, yr Alban a Gogledd Iwerddon wedi’i hintegreiddio yn llawn i bolisïau cynhenid y gwledydd hynny, yng Nghymru, cedwir pwerau dros gyfiawnder yn San Steffan. Dywedodd y Comisiwn ar Gyfiawnder yng Nghymru, dan arweiniad yr Arglwydd Thomas, nad oedd unrhyw sail rhesymegol i’r sefyllfa presennol a bod y sgil effeithiau yn rhai anffodus dros ben.

Rydym eisioes wedi clywed gan yr Aelod anrhydeddus dros Caerdydd Canolog bod tangyllido cronig gan San Steffan mewn gwasanaethau cyfiawnder wedi golygu bod Cymru wedi gorfod llenwi’r bwlch a adawyd gan yr Undeb. Ond yn waeth na hyn, gwelwn fod polisïau San Steffan wedi cyfrannu at lefelau anghynaladwy o garcharu a olygai yn 2019 bod gan Gymru y cyfraddau carcharu uchaf yng ngorllewin Ewrop. Mae’r setliad cyfansoddiadol presennol, felly, wedi methu mewn dyletswydd sylfaenol: y dyletswydd hynny i sicrhau mynediad teg a chyfartal i gyfiawnder. Gan ddod i’r casgliad unfrydol bod pobl Cymru ar eu colled yn y system bresennol, argymhellodd y comisiwn yn 2019 y dylid datganoli cyfiawnder deddfwriaethol llawn ynghyd â phwerau gweithredol i Gymru. Fel dywedodd y Comisiwn Thomas, yn eithaf huawdl yn fy marn i:

“Mae angen gwell system ar bobl Cymru, ac maent yn haeddu hynny.”

Nid ynys yw cyfiawnder a dylid ei integreiddio â pholisïau ar gyfer Cymru gyfiawn, deg a llewyrchus.

Mi wnaf i ysgubo trwy ambell i ddarn o’m haraith, ond hoffwn ddweud bod Plaid Cymru wedi croesawu ers tro ymrwymiad rhethregol y Llywodraeth hon i ddatblygu economi Cymru a’i chefnogi i fod yn gydradd â gweddill y Deyrnas Unedig. Wrth wneud hynny, rydym yn disgwyl i’r Llywodraeth ddatganoli pŵer i ffwrdd o’r Trysorlys, sicrhau bod penderfyniadau a gweithredu yn digwydd yn nes at ein cymunedau, a bod eu rhethreg yn gyfateb i’r cyllid caiff ei glustnodi ar gyfer y dasg.

Mae’n rhaid i mi gyfaddef, serch hynny, bod yna eisioes rheswm i boeni na chaiff yr addewidion lu eu gweithredu, ac yn hytrach fod anghydraddoldeb rhanbarthol yn rhan annatod o economi a phenderfyniadau sefydliadol gwladwriaeth y Deyrnas Unedig. Er enghraifft, yn Llundain mae cynhyrchiant ac enillion rhwng traean a hanner yn uwch na chyfartaledd y Deyrnas Unedig, yn ôl yr Institute for Fiscal Studies. Yng Nghymru, mae ein cynhyrchiant o leiaf 15% yn is na chyfartaledd y Deyrnas Unedig ac enillion bron 40% yn is nag yn Llundain. Yng Ngheredigion, mae’r gwerth ychwanegol gros lleol y pen bron i 37% yn is na chyfartaledd y Deyrnas Unedig. Gwelwn, wedyn bod buddsoddiad mewn ymchwil, sy’n allweddol i sbarduno arloesedd a chynhyrchiant gwell, wedi ei ganolbwyntio ers tro yn Llundain a de-ddwyrain Lloegr, gyda gwariant y pen yn 2019 yn rhyw £577: mwy na dwywaith y swm cyfatebol i Gymru.

Nid mewn termau economaidd yn unig y mynegir yr anghydraddoldeb hwn. Gwelwn goruchafiaeth Llundain a’r de-ddwyrain ym mhob man, o argaeledd ac ansawdd cysylltiadau trafnidiaeth i gefnogaeth i amgueddfeydd ac orielau. Ystadegyn syfrdanol oedd bod gwariant y pen ar ddiwylliant yn Llundain rhwng 2010-11 a 2017-18 gymaint â £687 y pen—bron i bum gwaith cyfartaledd gweddill Lloegr, heb sôn am Gymru. I’r pant y rhed y dŵr, fel y dywed yng Ngheredigion.

Cyn cloi, rwy’n troi at yr argyfwng presennol o ran costau byw. Rydym yn gwybod eisioes bod sefyllfa Cymru yn un eithaf bregus yn y maes hwn, ac ar ben popeth, nawr mae’n rhaid i deuluoedd ledled Cymru wynebu argyfwng y costau ynni nad yw Llywodraeth y Deyrnas Unedig wedi gwneud dim i fynd â’r afael ag ef hyd yn hyn. Mae’r diffyg yma yn cael effaith ofnadwy ar Gymru, lle mae 11% o aelwydydd yn byw mewn tlodi tanwydd a’r ffigwr ar fin gwaethygu. Yn anffodus, nid yw bod yn rhan o’r Undeb wedi ein hinswleiddio rhag yr argyfwng yma. Nid problem tymor bir fydd hi chwaith. Datgelodd y Gyllideb Prydeinig mai dim ond rhyw 0.8% y flwyddyn y disgwylir i incwm gwario gwirioneddol aelwydydd ledled Prydain dyfu dros y pum mlynedd nesaf. Roedd incwm gwario gros yng Nghymru yn gyfateb i ond tua 80% o gyfartaledd y Deyrnas Unedig yn 2019, sef yr ail isaf ar draws Prydain, felly mae’n syndod nad oes gweithredu ar fyrder yn digwydd tuag at y perwyl yma.

Yn olaf, ar ôl sôn am sefyllfa’r economi ar hyn o bryd, rhaid hefyd inni edrych tuag at y dyfodol. Yn fyr iawn, o ran polisi masnach, caf i ddim amser i fynd i berfedd y peth heddiw, ond yr hyn ddywedaf yw y pe bai gan Unoliaethwyr unrhyw fwriad i ddiogelu dyfodol yr Undeb, byddent yn ymrwymo ar unwaith i’r egwyddor bod rhaid i Lywodraeth y Deyrnas Unedig geisio cael cytundeb y Seneddau datganoledig cyn arwyddo cytundebau masnach newydd.

(Translation) I am running out of time, so I will not take further interventions. I want to briefly talk about two problems that arise from the current settlement. The predominant one relates to the justice system. While justice in England, Scotland and Northern Ireland is fully integrated into the policies of those countries, powers for justice in Wales are retained in Westminster. The Commission on Justice in Wales led by Lord Thomas stated that there was “no rational basis” for the current situation and that the knock-on effects were extremely unfortunate.

We have heard from the hon. Member for Cardiff Central that chronic underfunding by Westminster of justice services has meant that Wales has had to fill the gap left by the Union. Even worse, Westminster policies have contributed to unsustainable levels of incarceration and have meant that in 2019 Wales had the highest levels of incarceration in western Europe. The constitutional settlement has failed in its fundamental duty—the duty to ensure fair and just access to justice. Coming to the unanimous conclusion that the people of Wales are missing out in the current settlement, the 2019 commission stated that full legislative powers for justice should be devolved to Wales. As the Thomas commission stated quite eloquently, in my view,

“The people of Wales both need and deserve a better system.”

Justice should be integrated into policies for a just, fair and prosperous Wales.

Plaid Cymru has for some time welcomed the rhetoric of the Government on developing the economy of Wales and supporting it to be equal to the rest of the United Kingdom. In doing so, we expect the Government to devolve power away from the Treasury and ensure that decisions and actions take place closer to our communities. Their rhetoric should correspond to the finance earmarked for the task.

I must admit, though, that we already have reason to be concerned that those promises will not be fulfilled and that, instead, regional inconsistency and inequality will be part of the state of the United Kingdom. According to the Institute for Fiscal Studies, productivity and earnings are between one third and a half higher than the UK average. In Wales, production is at least 15% lower than the UK average, and earnings are almost 40% lower than in London. In Ceredigion, local gross value added per capita is almost 37% lower than the UK average. Investment in research, which is key to propelling better productivity, has focused for some time on London and south-east England, with investment per capita around £577, which is more than twice the equivalent sum for Wales.

It is not only in economic terms that these inequalities can be expressed. We see the supremacy of London and the south-east everywhere, from the availability and quality of transport connections to support for museums and galleries. An astounding statistic is that expenditure on culture per capita between 2010 and 2017-18 was as much as £687 in that region—almost five times the average of the rest of England, let alone Wales. Money follows money.

Before I conclude, I will turn to the current crisis around living costs. The situation in Wales is quite fragile in this regard. On top of everything else, families across the whole of Wales now have to face the crisis around energy costs that the UK Government have done nothing to deal with so far. This flaw is having an awful impact on Wales, where 11% of households live in fuel poverty—a figure that is about to deteriorate further. Unfortunately, being part of the Union really has not insulated us from this crisis. It is not a short-term problem, either. The UK Budget expressed that real household income was expected to grow by 0.8% over the coming five years. Gross household expenditure in Wales only corresponded to 80% of the average for the UK in 2019—the lowest across Britain—so it is surprising that there has been no urgent action taken towards this issue.

Finally, after talking about the situation of the economy at the moment, we must also look towards the future. I will not have time to go into the detail of trade policy today, but I will say that if Unionists had any intention of safeguarding the future of the Union, then they would take action immediately on the principle that the UK Government have to seek agreement with the devolved Governments before they sign any new trade agreements.

--- Later in debate ---

[Stephen Crabb]

It is a pleasure to serve under your chairmanship, Mr Davies, although it does mean that we will not benefit from a contribution from you to today’s debate. I will start by commending the Secretary of State on calling this meeting of the Welsh Grand Committee. It represents something of a revival, or a resuscitation, of the Committee, given that it looked like it was going to go the way of the Scottish Grand Committee and disappear from parliamentary proceedings quietly into the night. It is a timely moment to have a grand Welsh debate today, given the extraordinary period that we have come through as a nation and given the significant and serious challenges that lie before us. I hope the rest of the debate will be constructive and honest as we address these issues.

The pandemic has tested our nation’s financial and institutional capabilities, and proved a test to our constitution. We should all be able to agree today that, as we emerge from this current phase of the pandemic and hopefully enter a more benign phase, we can agree that the United Kingdom comes out of it with its relevance and importance highlighted more than ever. Contrary to what the Opposition have been primed to say, the fact is that the UK Government got the big calls right all the way through the pandemic. As the Secretary of State has highlighted, there was a period of very fast decision making at the time of uncertain, partial information and evidence. Whether one looks at the decisions around the furlough scheme and business support, the decisions around vaccine development, procurement and roll-out of the vaccines once approved, or at the most recent decisions on how we responded to the omicron variant and the very fine balance that we had to strike just before Christmas, taking precautionary measures but not damaging the economy, which had started to rebound following the earlier lockdowns, the Government’s decision making has been proved broadly correct. I look forward to the future review demonstrating that. The truth is that the UK compares very favourably with nations similar to ours, in terms of how ready we are to move ahead in this better phase of the pandemic, and to continue the economic growth.

[Beth Winter (Cynon Valley) (Lab)]

We have had in excess of 150,000 deaths from covid in this country. It is an absolute disgrace. My constituents in Cynon Valley had the third highest death rate in the UK. How can the right hon. Gentleman say that the UK Government’s decision making during the covid pandemic should be commended when we have had one of the highest death rates from covid in the world?

[Stephen Crabb]

I am sorry to respond to the hon. Member: it is not true that we have the worst covid death rate in the world. The standardised measurement of per 100,000 shows that Britain compares to similar sized nations such as Spain, France and Germany. There are a lot of other countries that have sadly experienced far greater deaths. Every single death is a tragedy, as the hon. Member is right to say. My other point in response is that decisions about public health in Wales were almost wholly the responsibility of the Welsh Government.

The decisions taken at UK level that affected Wales were around the financial architecture of how to support individuals, families and businesses. The public health measures were taken by the Welsh Government. As I will explain, generally the Welsh Government have veered to a tendency for more lockdown rather than fewer, wanting to be stricter, often on very flimsy scientific evidence—as the hon. Lady herself demonstrates in her question, to such little effect.

I draw hon. Members’ attention to the latest jobs data published this morning, with record job vacancies again and the employment picture continuing to improve. That is not what many people predicted for this phase of the pandemic, once the furlough scheme had been unwound. People were predicting a crisis of unemployment, but the truth is that that never happened. What happened was that the UK economy was well placed to rebound strongly last summer and it has continued to create jobs.

That is a really good thing, and it is down to the decision making of the Treasury team, to create that furlough scheme, which meant that there was not a tsunami of business failures and redundancies. Businesses were able to use that as a platform to grow again once the economy had been reopened. We do face challenges: the cost of living is certainly one of them, inflation, energy price hikes and, as revealed in this morning’s data, the fact that wage levels are not keeping pace with the cost of living, which is a serious issue that we need to address.

I reinforce the message of the Secretary of State that, when it came to those big decisions about how to get the country through the economy, the UK Government have been proved right. The Prime Minister continually emphasises the importance of seeing this as the one United Kingdom emerging from the pandemic. He is always incredibly polite and careful in his remarks about the Welsh Government and the First Minister. Even in private, when we coax him to say something critical about the Welsh First Minister, he is always incredibly polite, when sometimes we would like him to be stronger.

He is doing that in a genuine spirit of teamwork. That reflects well on the Prime Minister: he genuinely wants to foster a team UK ethos, respecting the fact that the Welsh Government have a different set of competences and have the freedom to take different decisions about public health protection measures. He is genuinely trying to foster an atmosphere of team UK.

[Wayne David]

I have a wry smile on my face because the right hon. Gentleman is talking about an individual we know does not exist. His view is not shared by the majority of his colleagues who are twittering and twattering in the corridors about the next leader of the party all the time.

[Stephen Crabb]

I am talking about our response to the pandemic and the Prime Minister’s determination to get this country through it as one United Kingdom, in the spirit of teamwork, as far as politics allows. I find the posture of Welsh Government towards UK Government throughout the pandemic disappointing and somewhat dismaying, because it is in contrast to the politeness from the Prime Minister about the Welsh First Minister and the sense of team UK that the Prime Minister has been trying to foster.

The stance of the Welsh Government has been constant, incessant criticism, complaint and grievance towards UK Government. I will highlight a few examples of the complaints from the Welsh Government, which are corrosive and not grounded in reality.

The most common complaint from the Welsh Government over the years is financial—they never get enough money from the UK Treasury. As Welsh politicians representing our constituencies, we always want more for our constituents if possible, but I have always regarded with a bit of suspicion the complaint that they do not have enough money. I look at some of the money that they have made available to Cardiff airport, to take a stake in sports car company TVR and some of the other odd investments the Welsh Government have made in certain property deals. I am a bit suspicious when they complain that they never have enough money. Certainly, when it comes to the pandemic, the sums of money that the Treasury has made available to the Welsh Government are unprecedented, really significant and really welcome.

One of the other grievances of the Welsh Government, as you know, Mr Davies, is about a lack of communication and dialogue between them and the UK Government. We both sit on the Welsh Affairs Committee, Mr Davies, and have had the chance to ask the Secretary of State about that, as well as other UK Ministers and Welsh Ministers. We are very grateful that Welsh Government Ministers make themselves available for our evidence sessions. The testimony we have heard from so many Welsh Government Ministers is that their own Departments’ dialogue with the UK Government is really good—lots of meetings and discussions. That backs up the point that the Secretary of State made in his testimony to the Committee that there has been an almost unprecedented number of meetings and forums between the UK Government and the Welsh Government during the pandemic. Far from it being a period when, somehow, the UK Government have been snubbing or not valuing the opinion of the Welsh Government, the pandemic has set a high water mark of engagement between UK Government and devolved Government.

The third grievance we have heard continuously from the Welsh Government, which is demonstrably false, is that somehow the UK Government were taking unsafe, reckless decisions about reopening the economy. We heard that very recently from the Welsh First Minister. The data just do not support that. As I said, every death is a tragedy in this country, but there is no evidence to suggest that the stricter—sometimes oddly strict—measures that the Welsh Government have taken have been based in sound science and have achieved any better outcomes. I look at some of the decisions that the Welsh Government have made around their restrictions, such as that nonsensical ban on outdoor parkruns, criminalising people wanting to go to their workplace—they could go to the pub but they could not go to work. There is a whole range of these things that are odd and divisive, and have made the Welsh Government and Wales an outlier in the United Kingdom.

[Jo Stevens]

I am rather confused by the right hon. Gentleman describing the Welsh Government’s recent covid measures as an outlier. The UK Government are the outlier. Scotland, Wales and Northern Ireland are not outliers in this case.

[Stephen Crabb]

I disagree, and I would point the hon. Lady to the most recent set of decisions on responding to omicron, which included some—what phrase did the Prime Minister use?

[Fay Jones]

Baroque inconsistency

[Stephen Crabb]

Yes. [Interruption.] “Baroque eccentricities” is the phrase that the Prime Minister used to describe some of the Welsh Government’s decisions.

I will draw my remarks to a close in a moment. What most concerns me about the posture of the Welsh Government during the pandemic is just how divisive they have been. There have been times when I felt they tried to politicise the border and to lean into what I describe as nationalist sentiment. The Secretary of State opened his remarks by saying that the majority of people in Wales support Unionist parties, but is the Welsh Labour party really still a Unionist party? I look at that agreement that it signed with Plaid Cymru in the Senedd—Plaid and Welsh Labour Members are sitting together almost seamlessly this morning—I hear the First Minister when he appears before the Welsh Affairs Committee and says that the Union is finished, and I look at some of the other decisions taken by the Welsh Government to create space between themselves and the United Kingdom, and I question what kind of journey Welsh Labour is on. Welsh Labour used to be an absolute bastion of the Union and could be relied on to defend the United Kingdom. I question what kind of journey it is on, because I do not see it as that same Unionist party.

[Nia Griffith]

Will the right hon. Gentleman give way?

[Stephen Crabb]

I will give way to the hon. Member because I like her a lot.

[Nia Griffith]

Will the right hon. Gentleman acknowledge that, time after time, the First Minister has referred to the fact that, during the pandemic, Wales gave personal protective equipment to England, and Wales benefited from PPE coming from England to Wales? Most recently, Wales has given 10 million tests to England. Time after time, the First Minister has emphasised the importance of working together across the United Kingdom.

[Stephen Crabb]

I thank the hon. Lady for the intervention. I have heard Vaughan Gething describe himself as a Unionist. I may be wrong, but I am not sure I have heard the First Minister describe himself as a Unionist. I think there is a division at the heart of Welsh Labour that should concern us all, as it is in perpetual government in Cardiff Bay. I will leave that thought hanging. I thank Committee members for their time.

[Several hon. Members rose—]

Oral Answers to Questions

Stephen Crabb Excerpts

Wednesday 19th May 2021 Commons Chamber

[Simon Hart]

There were many questions included in that, but I am delighted to have played a part in getting the global centre of rail excellence situated in the hon. Lady’s constituency. That was a Government announcement by the Chancellor in the Budget, and it shows that collaboration can work when we try to achieve these aims. As far as covid reaction is concerned, that has been a team effort and a cross-UK effort. The vaccination programme is probably the clearest indication of why the Union matters and how we have been able to work collaboratively with our colleagues in the Welsh Government to deliver something that genuinely benefits the entire nation.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

What discussions he has had with the Welsh Government since the 2021 Senedd election.

[The Secretary of State for Wales (Simon Hart)]

My right hon. Friend the Prime Minister spoke with the First Minister shortly after the election result. I have extended an invitation to meet the new Minister for the Economy. We have had calls with the First Minister and the Chancellor of the Duchy of Lancaster last week, and another one is due this evening.

[Stephen Crabb]

The recent elections demonstrated that the vast majority of voters in Wales have no time for independence. They have little time for ripping up the devolution settlement either. What the elections showed is that they want their politicians and Ministers at either end of the M4 to work together to make good things happen for Wales, and to make Wales a stronger and more prosperous part of the UK. Given that the success of the vaccination programme shows that this can be done, what needs to happen now to unblock other important policies such as freeports, which are stuck between the UK and Welsh Governments?

[Simon Hart]

My right hon. Friend is spot on; we have had considerable, really enthusiastic interest in the freeport programme from across the whole of Wales—it will bring 15,000 jobs and it is a manifesto commitment—and the only obstacle standing between us and delivering it is currently the Welsh Government. I am determined to work collaboratively, as we have said before, to get this over the line, and any pressure that anybody in this House can bring to bear to help us achieve that will be very welcome.

Welsh Affairs

Stephen Crabb Excerpts

Thursday 25th February 2021 Commons Chamber

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

I start by putting on the record my condolences to the family of Dr Hywel Francis, one of my predecessors as Chairman of the Welsh Affairs Committee. He was a man of huge intelligence and wisdom, and a very caring man. He will be missed enormously.

This St David’s Day debate is happening still under the shadow of the pandemic, but with very much better days just ahead as a result of the extraordinary national vaccination effort. We had something of a slow start in Wales, but I have no hesitation whatever in saluting what has been achieved over the last three months right across Wales. There were calls from some quarters for Wales to have its own vaccine strategy. Plaid Cymru pushed the line that Wales should cut loose from the rest of the UK when it came to procuring vaccines. It and its Welsh Labour allies also wanted us to be locked into the disastrous EU vaccine programme.

Now, with more than a third of the adult population in Wales having received a first dose, we can see the clear value of being part of an independent, UK-led strategy. The UK Government were able to move quickly and with strength to secure those vital early vaccine supplies, to the benefit of all parts of the United Kingdom. That, for me, is the value of the Union in action. Or we could point to the sheer financial firepower that has been brought to bear during the crisis. There has been billions of pounds of additional support for Wales, and hundreds of thousands of workers across Wales have had their livelihoods protected. That was possible only because at the heart of our United Kingdom, there is a powerful redistributive fiscal union.

For all that, there is a concerted effort under way to use the pandemic to weaken the bonds of our United Kingdom and to argue for division and separation. The Scottish National party and Plaid Cymru spokespeople will argue for exactly that later on. The question for me today, having listened to the speech by the hon. Member for Cardiff West (Kevin Brennan), is: where exactly is Welsh Labour when it comes to the Union? There was a time when Welsh Labour was a force for Unionism in this country. However, when I hear Welsh Labour politicians talk down and devalue the efforts of the United Kingdom, when I hear them wanting to stop the UK Government actually spending money on projects in Wales, when I hear them cynically stoke up the rhetoric about the English-Welsh border—and they know exactly what they are doing when they do that—and when I hear them criticise and delegitimise the visits to Wales of the UK Prime Minister, I fear that they have turned their backs on the Union and thrown in their lot with the nationalists.

I believe passionately that one can be a fierce, proud Welsh man or woman and that also alongside that one can be proudly British. There is no contradiction there, and for me perhaps the most powerful and attractive thing of all about our Union is that it does not force us to choose our identities. On that note, I wish a happy St David’s Day—Dydd Gŵyl Dewi Sant hapus—to you, Madam Deputy Speaker, and to all fellow Welsh Members of the House of Commons.

Oral Answers to Questions

Stephen Crabb Excerpts

Wednesday 3rd February 2021 Commons Chamber

[Simon Hart]

I am delighted that my right hon. Friend has raised this point. The public sector apprenticeship target is applicable only to bodies in England, but he raises a critical point about devolution. We are concerned that, for example, Welsh police forces are paying into the apprenticeship levy scheme but not getting anything out of it because the Welsh Government do not support police apprenticeships. I suggest that it would be very interesting for his Committee to look at why Welsh forces are paying in but getting nothing out the other end by way of apprenticeships.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

What assessment he has made of the effect of the EU-UK trade and co-operation agreement on Wales.

[The Secretary of State for Wales (Simon Hart)]

We have agreed a deal that provides Welsh business with exceptional access to the EU market. It is the first time ever that the EU has agreed a zero-tariff, zero-quota deal.

[Stephen Crabb [V]]

Getting the Brexit deal across the line before the end of the year was important, and huge credit is due to the Government for securing it, but we have a serious situation emerging at Welsh ports, with freight levels way down on where they should be. Will my right hon. Friend work urgently with ministerial colleagues, HMRC and trade bodies to find simpler solutions to the problem of checks and paperwork, which risks making the UK land bridge more costly and less attractive for trade between Ireland and the continent?

[Simon Hart]

As my right hon. Friend knows, I am in touch with Pembroke, Fishguard and Holyhead about this issue, and we are trying to make a distinction between what we can assign to covid changes in business and the other, more permanent factors that he refers to. There are some complications to do with port infrastructure, which is the responsibility of the Welsh Government. We have meetings tomorrow to try to push the Welsh Government to get that process under way more quickly. We have discussions with road hauliers about the land bridge. I assure him that we want this business to return to as near as possible as soon as possible, and I am happy to work with him and others to achieve that goal.

SPEAKER'S STATEMENT