Shared Prosperity Fund: Devolved Administrations

Debate between Stephen Kinnock and Gerald Jones

Tuesday 1st March 2022 Westminster Hall

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Edward. I congratulate the hon. Member for Belfast South (Claire Hanna) on securing this debate. I declare my membership of the all-party parliamentary group on the shared prosperity fund.

Since we heard about the shared prosperity fund way back in 2017, the whole thing has been shrouded in confusion. The Government have been less than forthcoming with clarity and detail. While we now have some more information about the fund, there is still too much uncertainty.

Then there is the top-down, Whitehall-led approach that the Government have insisted on using. Welsh local authorities such as my own in Merthyr Tydfil and Caerphilly County Borough Council, which covers the Upper Rhymney valley part of my constituency, have 20 years’ experience of working together through the Welsh Local Government Association and alongside the Welsh Government to deliver strategic regeneration projects. It is deeply concerning that, instead of a strategic joined-up approach to investment to tackle the urgent issues affecting our communities, we now seem to see a centralised Whitehall-led approach administered by Departments with no real understanding of the needs of Welsh communities. They have limited experience of working with communities in Wales and little understanding of the priorities of those communities. There is also the complete bypassing of devolution.

[Stephen Kinnock (Aberavon) (Lab)]

My hon. Friend is making an excellent speech. I also declare an interest: I chair the APPG on the shared prosperity fund. The pre-launch guidance to the fund simply says that the devolved Administrations

“will be invited to play a role in the development and delivery of local investment plans.”

Does my hon. Friend agree that that is an incredibly vague statement, which could mean absolutely nothing, and that the fund is also part of a broader project being pursued by the UK Government of dismantling the entire project of devolution?

[Gerald Jones]

I very much agree. We are seeing an opportunity to bypass devolution, which is a very real threat to what has been built up over the last 20 years. This is not the partnership approach we all could have supported; I fear that it is a real step backwards.

I am deeply concerned, as I know others are, that Wales and areas across the UK are going to lose out as a result of the withdrawal of EU funds, despite the promise that we would not lose a penny. The Chancellor’s Budget for next year shows some £400 million across the UK as opposed to the £1.5 billion that was earlier mentioned. For the purposes of comparison, Wales alone used to receive £375 million. Next year, for the whole of the UK the figure will be barely that.

The lack of clarity from the Government on the amount of funding, how it will be used and the involvement of devolved Administrations has been hugely disappointing from the start, and it saddens me that it shows no sign of improvement. Hopefully, the Minister will give us further clarity and address the points that have been raised for so long.

I want to give a short, quick example to the Minister. Some years ago, prior to entering this place, I was a local councillor heavily involved in regeneration in my local community. A hugely significant regeneration project had £6 million of EU funding allocated to it, but that was just a catalyst. That funding also unlocked funding through the Welsh Government, the private sector, the lottery and other charitable partners, and not least the local community, meaning a significant investment of around £26 million all told. Those projects are still going strong almost 20 years later and are going from strength to strength. I use that example as an illustration because of the nature of the partnership between agencies, not least local government and the Welsh Government. We should learn from such examples.

Finally, what measures is the Minister taking to ensure that we can move forward in a spirit of collaboration involving all partners? As I said previously, any investment is welcome, but it should be in partnership with regional and local government and the Welsh Government, who have had significant experience in these areas. Speaking as somebody who was very much pro-Union, we achieve much more when we work together in partnership for the good of all.

Public Sector Pay

Debate between Stephen Kinnock and Gerald Jones

Monday 4th December 2017 Westminster Hall

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

Thank you, Mr Hanson, for calling me to speak so early in today’s debate. Given the large number of people who wish to speak, I will try to keep my comments relatively brief. I congratulate my hon. Friend the Member for Warrington North (Helen Jones) on setting out so powerfully how the Government are on the wrong track with regard to public sector pay. I also wish to declare an interest: two trade unions, Unison and the GMB, gave financial support to my constituency Labour party in the 2017 general election.

Right across the United Kingdom, we rely on our public servants each and every day to do the jobs that keep our communities and our country functioning—whether working for our local councils, maintaining our highways, cleansing our streets and villages, teaching in our schools, providing home care to the elderly, or working in our emergency services or Her Majesty’s armed forces. All those roles have one thing in common: they provide essential pubic services, and it is absolutely right that those public service workers need and deserve a fair pay rise.

The Government’s pay cap has been in place since 2010 —seven long years. Throughout that time, our hard-working public servants have endured significant financial pressures. Inflation has risen by 22% over this period, while public sector pay has risen by just 4.4%. Wage freezes and the Government’s pay cap have lasted throughout this time, bringing financial misery to public service workers and their families, and causing huge damage to services. For example, an average public sector worker, paid the median public sector wage in 2010 and subject to the two-year pay freeze followed by the pay cap, has seen the value of their wage drop by £4,700.

The pay cap and years of below-inflation pay awards are also having a significant impact on recruitment and retention, and are one reason why nurses have been leaving their profession in droves. Local government is having trouble recruiting and retaining staff, with the workforce survey revealing that 71% of councils are reporting issues. That recruitment and retention crisis applies across the public sector.

Although the Government have made pay offers in excess of 1% for some sectors, the pay cap effectively remains in place for the vast majority of public sector workers. It is important that the Government do not cherry-pick pay rises for some public sector workers, which could be seen as an attempt to divide.

[Stephen Kinnock (Aberavon) (Lab)]

Is my hon. Friend aware that in my local authority area, Neath Port Talbot, public sector workers took a voluntary pay cut totalling £8 million to avoid the catastrophe of compulsory early redundancies? Does he agree that such a situation cannot and should not be repeated?

[Gerald Jones]

Yes, I do. It is an example of the dedication of our public sector workers but, as my hon. Friend says, is a bridge too far.

We need to see an end to the public sector pay cap, with a fully funded pay rise for all those working in our public services. Local authorities have tried to ease the situation. The two local authorities serving my constituency, Merthyr Tydfil County Borough Council and Caerphilly County Borough Council, took decisions during the previous council term to become living-wage employers—the real living wage, not the pretend living wage that the Government are promoting. That has helped to mitigate, in a small way, the effects of the pay cap.

The Welsh Government have indicated their support for our public sector workers and repeatedly called on the UK Government to end the cap on public sector pay and give workers across the UK a much-needed pay rise, funded properly by the UK Government. They have stated:

“The UK Government must do the right thing and lift the pay cap right across the UK public sector as part of a wider strategy to end their damaging policy of austerity.”

With huge cuts to the Welsh Budget and local government in recent years, the Welsh Government have been unable to take further action without funding from the UK Government.

There are many economic arguments for paying our public service workers; however, as a country, surely it is our moral duty to value our public sector workers. They work to keep us safe, healthy, educated and cared for, in the face of prolonged real-terms pay cuts that have strained their working and family lives. The Government need to act. Last month’s Budget provided the Chancellor with an opportunity to bring an end to the period of unfairness and pay misery for public sector workers. The Chancellor chose not to act. Instead, public service workers are facing Christmas and the new year wondering how they are going to make ends meet.

Finally, figures have been released today showing a rise in the number of children and older people in poverty of 700,000. That may not be wholly attributable to the pay cap; however, in-work poverty is on the rise, and the pay cap will have had a significant impact on that. Food banks are now used more by people in work than by those out of work. Taken with the resignations of the members of the Social Mobility Commission, there is plenty of evidence to urge the Government to act. I look forward to the Minister’s response, and urge the Government to listen and take action sooner rather than later.