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Mr. Nicholas Bennett (Pembroke) : With regard to Welsh in the school curriculum, may I ask my right hon. Friend to bear in mind the fact that, although we in Pembrokeshire support encouragement being given to the Welsh language and culture, there is the traditional culture of Pembrokeshire which for nearly 1,000 years has been based on English? Will he also bear in mind the representations which are being made to him by the

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governing bodies of schools in south and mid -Pembrokeshire? They feel that rather than be obliged to have Welsh as a compulsory part of the curriculum, which will alienate the large number of English speakers, its inclusion in the curriculum should be voluntary.

Mr. Walker : I hope that, in all of what can be described as the predominantly English parts of Wales, considerable enthusiasm will be shown by education authorities to ensure that the teaching of Welsh is available. In terms of Wales as a whole, that represents a positive approach. I do not believe that there is any need for the English-speaking parts of Wales to show any fear or hostility towards the idea of more children of English- speaking families learning the Welsh language. The measures that we are pursuing in this sphere will prove to be important.

I note that the Welsh Language Board has been offered more than £250,000 to undertake the tasks that I have set it. That is the amount of money that it suggested that it would need in the coming year for the tasks that it will be taking on. In that area too, therefore, considerable progress is being made.

I wish to consider next the provisions that have been made and the legislation that has been passed in relation to housing. As yet, neither local authorities nor the people of Wales have recognised the radical change that is taking place and the way in which it can lead to considerably greater resources going towards improving the housing stock in Wales. The new housing improvement grants which will come into force in 1990 will be of particular benefit to Welsh householders and will enable us to target resources to those in greatest need.

For the first time, there will be a mandatory grant to enable dwellings to meet a new and more objective fitness standard. Discretionary assistance will be available to improve properties beyond that to a new target standard. Our test of resources will ensure that those in the greatest need receive the highest level of assistance, and for the first time grants of up to 100 per cent. of the cost of the works will be available. For example, a pensioner couple with an income of £90 per week will receive 100 per cent. assistance by way of grant. A married man with two children and earnings of £6,000 will also receive 100 per cent. improvement grant.

Considering the position and nature of the housing stock in Wales, the nature of the people of pension age and the fact that there has been a massive programme of housing improvement in Wales--in the last 10 years it was far greater than anything that had previously taken place--this new mechanism, by which throughout the United Kingdom a great deal of the money will go to those on lower incomes with the worst housing, will result in a considerable transformation of the scene in Wales. I hope that local authorities and others concerned will examine carefully how to take full advantage of the scheme when it is introduced in 1990.

Mrs. Clwyd : The Cynon valley has the highest percentage of unfit housing in Wales, and more than half the privately owned houses are unfit for human habitation. will the right hon. Gentleman estimate how long it will take the Cynon valley to put right its unfit housing under the programme that he has been describing?

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Mr. Walker : I cannot think of any part of the United Kingdom that will benefit more from this scheme than the Cynon valley, because, as the hon. Lady says, there are many people on low incomes and a large number of old houses. Never, under any Government of any complexion, has there been a mandatory right to 100 per cent. grant for people in that position. I hope that the hon. Lady's local authority will examine in detail exactly how it can take advantage of the scheme. The speed with which advantage is taken of the scheme is important in terms of planning, because Wales has experience of poor workmanship in house improvements. As the scheme will not come in until 1990, that is a good period for local authorities to examine, survey and decide how to meet the mandatory requirement on them to deal with the problem. For areas such as that represented by the hon. Member for Cynon Valley (Mrs. Clwyd), this will be an important and radical measure.

I come now to some controversial areas in terms of party politics. Before the White Paper on health is implemented, there will be plenty of time for dialogue and suggestions. I hope that we shall debate the White Paper in the Welsh Grand Committee, when I shall be interested to hear the views of hon. Members. As one of the small number of Cabinet Ministers who were originally involved in the drafting of that White Paper, I give a categorical assurance that there has never been any motivation that it should be a means of privatising the National Health Service. I believe that it is absolutely vital to keep the NHS and to manage it well.

I hope that, when people examine the White Paper--as I had to examine it in terms of drafting--they will bear in mind the importance of deciding what levels of quality to set for the management of the NHS. Irrespective of the complexion of the Government in power, that is a very real problem. By considering the quality of management, the manner of its recruitment, the amount that it is paid and the diverse nature of the skills required, we wish to improve the quality of delivery, whatever total Government expenditure is put into the NHS. I am eager and willing to look at ways to achieve that improvement. For example, would there be advantage in having more managerial power at hospital level rather than at district authority level? If that were to be done, it would have to be on the basis that management had all the obligations to carry out all the services that were needed in the locality served by that hospital. Not only would there have to be a management structure by which that would continue to be done, but we would have to monitor the situation to ensure that it was being done after the change had taken place.

There are many issues in the White Paper, some controversial and others not, but they are all important, considering the considerable resources that are being spent on health. In what I might call the Welsh passage in the White Paper, we can see that in Wales perhaps more than in most parts of the United Kingdom there is considerable scope for improving the services to see that the lifestyle of the people, the prevention of illness and health care is improved. We are examining proposals on those matters and I hope that they will come forward in the coming year.

Mr. Ted Rowlands (Merthyr Tydfil and Rhymney) : The Welsh Office does not appear to have produced working papers on the Welsh section of the White Paper. Will the

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right hon. Gentleman say more, for example, about the so-called treatment centres? I cannot discover any information to flesh out what is said about those centres.

Mr. Walker : On most issues we shall be issuing papers similar to those for England, and of course those principles will apply. I think that they are to go out this week. Thereafter, we shall issue papers on specific Welsh proposals. There will be plenty of time for discussion and I am anxious to hear the views of hon. Members in all parts of the House.

I recognise the party political differences on water and electricity privatisation. When those proposals have been implemented and are fully in operation they will have to be examined by the people of Wales. Prior to vesting date, many issues will arise about the form of privatisation, the way in which the shares are placed and the use of land holdings. I am happy for those two proposals to be examined on their merits when they are in operation.

I should like to say a few words about the general economy of Wales and deal with some regional matters. In regard to north Wales, I have asked my hon. Friend the Minister of State to examine the implications of the completion of the A55. He will be meeting local authorities and will welcome the views of Members of Parliament representing north Wales and other areas. Currently, the movement of inward investment in north Wales is very encouraging. A whole range of potential planning applications are under consideration. Obviously, I cannot comment on them, because any appeals will come to me. There is no doubt that there is enormous interest in development along the A55 and enormous potential for tourism. We have to examine carefully ways to attract to mid-Wales, west Wales and north Wales businesses and interests in which the geographical location is no longer of any great importance. Due to the nature of

telecommunications and monocommunications for a whole range of service industries there is no disadvantage in being in a place that is not on the main routes but is very attractive. I want to persuade local authorities along the A55 to take a postive approach to planning and not merely react to applications that are put in. They have to make clear which areas they would like to see developed and the type of development that they would prefer.

I understand the fear that development will damage Welsh language and culture, but nothing has been more damaging to the language than the lack of economic development, which has led Welsh-speaking people to move away. If economic development means firms and managers coming from outside, one has to examine the education system and ensure that the Welsh language is preserved, but one also has to consider the enormous advantage of active economic development. In the coming months, therefore--before the summer recess, I hope--the potential of the A55 to north Wales will be examined.

The letting of factory units in mid-Wales during the past 12 months has been quite staggering, and way beyond what was predicted. For that reason, we have given the go-ahead to further investment programmes. Some further units are under construction and some are to be built in the coming year. If we consider the scale of population concerned there are considerable advantages in making such efforts. In regard to south Wales, in the long- term communications are terribly important. The completion of the second Severn bridge is also of considerable

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importance. I am delighted that the firms to which the tender documents are being sent were announced yesterday. We have given them a very short time in which to put in their tenders and I hope that shortly afterwards we shall be able to make decisions and proceed quickly with the building of the new bridge. Likewise, an improvement of the railway services is extremely important to south Wales and will take place on a considerable scale.

Mr. Win Griffiths (Bridgend) : What discussion has the Secretary of State had with British Rail and other interests in the railway sector? Has he considered a direct rail link through the Channel tunnel to European capitals for passengers and freight? It is totally unacceptable for such a link to go through London, as it would cause complete chaos.

Mr. Walker : I have had talks with the chairman of British Rail and with the chairman of the Channel tunnel company about that. British Rail has a statutory requirement to produce a basic plan for building an infrastructure fitting into the Channel tunnel during this calendar year and it is working on that. I have relayed to British Rail the importance of good freight and passenger services. In regard to freight, the important thing is not necessarily the direct line to the Channel tunnel, but where, how and how speedily the carriages are assembled and how quickly they go through the Channel tunnel. In various parts of Wales, we have to create very good modern freight terminals in which carriages can be assembled and made ready to move as whole trains or to link up with other trains to go through the Channel tunnel. We are considering those issues in great detail with a view to creating an extremely good service. We should remember, however, that 82 per cent. of all freight traffic to Europe will go by means other than the Channel tunnel. Everyone is becoming obsessed with the Channel tunnel, which will convey a very important 18 per cent. of the freight, instead of concentrating on improving communications for the other 82 per cent. of freight from the United Kingdom to Europe. There is considerable potential for south Wales in a possible link with Portugal and Spain through Milford Haven docks. Although the docks have been built, road improvements would be needed. There is considerable potential for getting a considerable amount of United Kingdom freight to Spain, Portugal and Ireland by that route.

Mr. Roy Hughes (Newport, East) : Before the Secretary of State leaves the subject of railway links, will he confirm that British Rail has been considering the possibility of reopening the Severn tunnel junction which was closed--in my view, ill advisedly--only two years ago? Will he also say something about railway halts in Gwent? There is certainly a clamour for one in Magor, which is developing fast. Can the Secretary of State give any assistance to Gwent county council as it seems that British Rail is asking for an exorbitant amount of money to provide that halt?

Mr. Walker : I have not discussed either of those matters with British Rail. I have heard nothing from British Rail about those issues, but I shall look into them.

We must consider a number of issues concerning south Wales. Newport and Cardiff enjoy a great deal of inward investment, including the big Ford investment. I believe

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that the area surrounding Swansea also has considerable potential. The WDA factory programme announced today suggests a specific programme, and a number of local authorities around Swansea bay have formed a consortium, including a number of places currently confronted with considerable difficulties, such as Llanelli. I hope that there can be a range of promotional activities and factory building which would greatly benefit areas further west along the M4 motorway.

In regard to the economy, the WDA factory building programme announced today is on a considerable scale. I shall not bore the House with the details other than to say that they are a considerable increase on anything that has taken place before. However, I shall say a few words about an important issue to Wales--the future of inward investment. Recently, the Select Committee examined inward investment and made a range of proposals. There is no doubt that inward investment into Wales in recent years has been on a considerable scale and has proved a great success.

In the past year, inward investment has broken all records in terms of forward investment. Even excluding Ford, it breaks all records for inward investment. We are enjoying a big proportion of the inward investment in the United Kingdom. We have an attractive package of measures, thanks to the selective assistance and the Welsh Development Authority. The most important and attractive ingredient is the fact that we have gained a good reputation in labour relations and productivity.

I believe, however, that our drive for inward investment must be even more professional in the immediate future than in the past. We have had colossal benefit from both investment and jobs, each of which has risen year by year on a considerable scale.

Mrs. Clwyd : Does the Secretary of State agree that the quality of the inward investment is important, that a number of the jobs that have been created in Wales recently are low paid and part time, that current average male earnings in Wales are the lowest of any region in Britain, and that the position of women is even worse? Is there not a possibility that people are exchanging poverty-line benefits for poverty-line wages?

Mr. Walker : That is a very bad remark to make about the quality of inward investment. It creates the impression both at home and abroad that the only thing coming to us is low quality investment. Does the hon. Lady think that the Ford investment is low quality or that some of the investment in the chemical and electronic industries is of low quality? As for average male full-time earnings, in two of the Glamorgan county council areas they are higher than in the west and east midlands at present. The image that the hon. Lady constantly wishes to depict of low earnings and unskilled people is just not true. I ask her to go down the list of inward investments over the past two years. How can she suggest that they are of lousy quality? They are very high-quality investments, bringing a new range of activities and considerable skills to the Welsh economy. I warmly welcome them and hope that they will continue to be of such high quality.

One of the important new injections into the Welsh economy in investment is financial services. These are going on now on a considerable scale. In the recent past,

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the Trustee Savings bank has brought 2,000 jobs to Newport. There has also been investment by the National Provident institution, a major French bank, Rothschild's, and the expansion of Lloyd's bank in Swansea. We also have a whole range of small firms expanding their staff and their activities. Over the past eight years, 20,000 additional jobs have been created in financial services in Wales. Nobody would have predicted that rise such a short time ago. I am glad that it is accelerating, and I am glad that the Cardiff bay development will add to it. It is something that will benefit the whole of Wales.

Mr. Win Griffiths : It is interesting to hear the Secretary of State refer to 20,000 extra jobs in financial services in the past eight years. He must realise that in the past 10 years we have seen a reduction of 153,000 full-time jobs in Wales. When does he expect us to get back to the levels of employment that existed when Labour was in power?

Mr. Walker : I suggest that if the hon. Gentleman waits for the forthcoming figures he will be pleasantly surprised. He may, when he sees them, say that this is due to the very small sample that was taken, and that may well be true, but all I can say is that in Wales we have the remarkable fact that since its peak in May 1986 unemployment has dropped by 62,000 despite the fact that in that period we lost 10,000 more jobs in coal and steel. Financial services are a very important part of the economy.

The Select Committee said that it did not like the title of WINvest, and that it should be replaced or altered. I accept that recommendation, as I do not think that it is a good name.

Mr. Rhodri Morgan (Cardiff, West) : How about "Walkervest"?

Mr. Walker : That might be much better. If it comes about, I shall cite the hon. Gentleman as the proposer.

We see, therefore, that Wales is experiencing a substantial fall in unemployment, has an enormous flow of inward investment and has the biggest factory building programme for its size anywhere in the United Kingdom and perhaps anywhere in Europe. The diversity and number of new jobs is increasing and new training is being carried out on a considerable scale. The combination of all these factors is transforming the Welsh economy. I believe that the people of Wales recognise that this transformation is taking place and that it is very much to the benefit of future generations in Wales.

5.24 pm

Mr. Barry Jones (Alyn and Deeside) : It was interesting to hear the Secretary of State refer to inward investment and to a record building programme. Some of us on the Opposition Benches thought that the really big record was his output of press releases during the past year : they have rained down on Wales thick and fast. I had hoped to hear in the right hon. Gentleman's assessment of the economy how he saw the impact upon small and medium-sized businesses in Wales of a possible further rise in interest rates. As regards inward investment, I had hoped to hear some sort of statement on the Toyota project. But he did not mention them. I would use the word "sanguine" to describe his speech, even "over-sanguine", and as a corrective I will offer a reference to the report by the Low Pay Unit in today's Western Mail, which says that :

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"the divide between Wales and the south-east of England is now greater than it was a year ago."

According to the Western Mail,

"The report argues that the situation has worsened since the loss of relatively well-paid, male-dominated jobs in the Welsh coal and steel industries in the early 1980s. Low pay is also common in rural Wales."

It makes the serious statement :

"Average earnings for men are lower in Wales than in any other region of Britain".

More facts as an antidote to an over-sanguine speech. In Clwyd male unemployment is 12.8 per cent., in Dyfed 14.8 per cent., in Gwent 14.2 per cent., in Gwynedd 17.1 per cent., in Mid-Glamorgan as high as 17.3 per cent. ; South Glamorgan has 12,459 unemployed men and some 4,200 unemployed women, and West Glamorgan has 14.5 per cent. male unemployed. These are very serious figures. The right hon. Gentleman's approach today took no account of the very large-scale unemployment that still exists throughout Wales today. One of the disadvantages that he labours under is that his Prime Minister, early in the 1980s at a Conservative conference in Swansea, actually said that the unemployed of Wales should travel to England to find work. The right hon. Gentleman referred to two late colleagues of ours. Sir Raymond Gower was regarded by all of us as a very personable man and a very gentlemanly person--a very nice man. Nobody would deny that he was a House of Commons man. None of us ever heard from those Benches any harsh or personal statements that were offensive. In the Tea Room he was a pleasure to talk to. He had a great deal of humour ; he used to understate matters. In the Welsh Grand Committee, Raymond Gower was always very loyal to his Ministers, and he displayed a great deal of insight into the politics of Wales. I rather think that, over the years and behind the scenes, he gave Ministers a lot of good advice. Nobody can take from him his superb constituency work. He was probably one of the finest ever constituency Members. Nobody could say that Raymond Gower had other than tremendous personal and loyal support from Lady Gower. Our proceedings will be the poorer for his death.

In passing, I draw attention to the pressure in modern politics throughout Wales. I remember Mike Roberts, Alec Jones, Brynmor John and Euan Evans. We can all draw some conclusions from the passing of these colleagues.

Having spoken about late colleagues, I should now like to welcome my hon. Friend the Member for Pontypridd (Dr. Howells) who had an exceptionally warm welcome today. He fought a fine campaign and is no stranger to us. He is a considerable broadcaster and his by-election victory is a watershed in this Parliament. I enjoyed listening to all his speeches in the campaign, and I especially like his identification with and loyalty to his own industry of mining. I was impressed by his love of the Welsh landscape and know that he will do his best in the House to guard it. He spoke up strongly for the under-privileged in his constituency--those on low wages and people who are badly housed. When my hon. Friend speaks in the House, some of these issues may come forward.

I was disappointed in the Secretary of State's response to the loss of jobs in the steel industry. In Trostre, Velindre, Brynawel, Ebbw Vale and Shotton, there have been heavy job reductions, over 1,000. Those were hi- tech, full-time, first-rate male jobs in manufacturing, and the

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economy cannot afford such job losses. I emphasise our great regret at the lack of consultation. It seems that, once the steel industry was privatised, the board was able to act at will. I do not think that the Secretary of State lifted a finger to help. I regret that, because we have lost some of the best jobs in Wales.

Perhaps the Secretary of State will say something about the tinplate industry in Wales as we go towards 1992. Our steel workers who suffered job losses are getting a poor repayment for first-class productivity. They generated profits but have suffered a reduction in manning because there have been many redundancies over the years. The Secretary of State should take into account the strength of the industry. I do not want that strength to be dissipated now that the industry is privatised. I warn the Secretary of State that many steel workers in Wales fear that their jobs will go to contractors. I am informed by trusted and experienced trade union leaders that there is always a decline in the status of jobs provided by contractors. That decline is in health and safety, pensions, wages, holidays and other conditions that were hard won and jealously guarded over many years. I should now like to turn to the south Wales coalfield. There is now a revue of the Cynheidre and Marine collieries in which about 1, 500 jobs are being looked at and about 500 jobs are under review elsewhere in the coalfield. The loss of 2,000 colliery jobs would be serious because coal and steel jobs are important. I have a hot question for the Secretary of State. Why is the Carway Fawr mine at a halt after the investment of £35 million? The miners believe that production has been halted so that when people are taken on again they will be non-NUM members.

We think that the supposedly moderate face of British Coal in south Wales is a blind. The south Wales NUM is noted for its good day-to-day industrial relations. We have every reason to believe that British Coal is acting provocatively and, arguably, wanting disputes. I should like the Minister to refute that. He should meet the chairman of British Coal and the area director for south Wales and raise these matters because they are of great importance to the coalfield.

I spoke about great pressure on miners. They are somewhat bitter because it seems that the productivity goalposts are being moved. They are also worried about the import of anthracite from China and there is apprehension about the effect on the south Wales coalfield of electricity privatisation. Because of the importation of anthracite our production centres are being closed. The Minister should intervene, not step aside and ignore the worries in the coal industry.

When we consider the potential loss of 2,000 coal jobs and 1,000 steel jobs, we see that even if the Toyota project were to come to Wales, the jobs that it would provide would be negatived. We could put it another way and say that, to replace the steel jobs soon to be lost in Wales, we would need several more of the magnificent Ford Bridgend investment projects. That shows that the matter is serious. Interest rate levels have prompted warnings from the business community in Wales. A recent survey by Cardiff chamber of commerce showed that high interest rates are an increasing headache for businesses in south Wales. We have had a warning from the director of the CBI in Wales, Mr. Ian Kelsall, that sustained high interest rates will lead to a decline in investment. I was disappointed that the Minister did not address himself to the problem of high interest rates in relation to industry in Wales. He did not

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address himself to the continuing impact of the balance of payments crisis or to the effect on businesses of likely increases in the cost of water, electricity and gas. He did not speak about inflation, which may well hit 8 per cent. before long.

The Secretary of State and I both know that the Budget surplus is estimated at about £10 billion. Will he use the authority and influence of his Department to ensure that the Severn bridge tolls are not increased? We should like to hear about the date on which it is intended to start the second crossing. We are worried by recent statements by the Minister for Public Transport, because it seems from reading reports of what he has said that he is not prepared in any way to say that the second crossing is a certainty. We expect the Secretary of State and his Ministers to fight hard for the earliest possible starting date. Given the size of the Budget surplus, there is no reason why the Department of Transport should not seriously consider electrifying the Crewe-Holyhead railway line.

We should have a guarantee of major increases in funds to tackle the housing crisis. The Secretary of State forgot to tell us that more than 4,500 people are homeless in the Principality, according to a recent answer to a question asked by my hon. Friend the Member for Neath (Mr. Coleman). We should like the Minister to press for an increase in child benefit and for more funds for the National Health Service, with the aim of mounting a meaningful attack on waiting lists and financing a genuine programme of preventive medicine in Wales.

The right hon. Gentleman should devise schemes to assist exporting industries in Wales. Something should be done about bringing in lower interest rates. On these Benches we say no to a free market ; we know, and the right hon. Gentleman knows, that Wales needs public investment, intervention and more and more funds.

While I and my right hon. and hon. Friends have criticised various legislative proposals that have come before the House in recent months, we need legislation which the Government have not brought forward. There was no mention in the Queen's Speech of a measure to make an attack on environmental pollution. Yet in Wales last year the infamous poison ship, the Karin B, wanted to dock at Neath. In my constituency poisoned soil has been dumped near houses, having been brought to Mostyn dock from Rotterdam. The Dutch did not want it ; we in Wales had to receive it.

In the borough of Torfaen, Rechem has an infamous smoke stack. Its outpourings frighten the local population. My hon. Friend the Member for Torfaen (Mr. Murphy) is fighting hard for a public inquiry. We should have a public inquiry too about continuing pollution of the river Dee, from which water is extracted for domestic use. There have been far too many pollution incidents on the river. The right hon. Gentleman surely saw the Daily Post this week where it is reported that the North West water authority still intends to dump raw sewage in Liverpool bay. Much of that deposit ends up in the north Wales area to the detriment of our beaches and our tourist industry. Public opinion demands ministerial intervention in the near future.

Mrs. Clwyd : Before my hon. Friend leaves the subject of pollution, will he please not forget probably the worst industrial polluter left in Britain, the phurnacite plant in

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Abercwmboi in my constituency? Does he agree that if that plant were in the south-east of England it would have been shut long ago?

Mr. Jones : I agree with my hon. Friend. It would be instructive if the right hon. Gentleman, in the course of his many visits to Wales, were to go with my hon. Friend to see for himself what it is like. More Welsh people should be involved in decisions affecting the environment. Above all, we want an adequate inspectorate. We have only one inspector responsible for poisons for all of Wales, yet the importation of foreign poisonous waste is a burgeoning industry. There has been a 13 per cent. increase in carbon monoxide from cars in the past 10 years. Expenditure on research into the environment has been cut by 17 per cent., yet there has been a tenfold increase in the importation of hazardous waste since the Government came to office. We want legislation, and we want the right hon. Gentleman to speak up for us on this matter.

Much of what the right hon. Gentleman said today related to the valleys initiative. We have a mandate to make our views known. The initiative has a noble aim if it is properly funded, strategic and not tactical, long term rather than short term, and if it is free of any taint of a confidence trick or of the technique of the sting. The right hon. Gentleman made an error last week. Two days before the Pontypridd by-election, he could not resist the temptation to meet some of his cronies and make a speech to them, instead of making a statement to the House on the Monday. I am sure that his civil servants advised him against doing that.

Mr. Peter Walker : May I say that there was no protest by civil servants? The speech was agreed and announced in September 1988 before there was any knowledge that there was to be a by-election.

Mr. Jones : So it was just a coincidence that the right hon. Gentleman went to meet his cronies two days before the Pontypridd by- election. His civil servants did not protest. They advised him not to do what he did.

Mr. Walker : I had no advice from any civil servant on that. The hon. Gentleman is suggesting that civil servants gave me advice which they did not. I hope that he will withdraw that.

Mr. Jones : The right hon. Gentleman is stung. He is embarrassed. He knows that he made a monumental error of judgment. By his demeanour during his intervention, all of us on these Benches know that he has virtually made an apology. I respond to the right hon. Gentleman in the same spirit as he made his intervention. My advice to the right hon. Gentleman is that he should not play around with the initiative for short-term gain. The councils in the valleys are good councils. They are well informed and responsible. Their reaction to the initiative has been reasoned. That is important for the whole programme. I want to give the right hon. Gentleman some advice. The areas outside the valleys are getting nervous. He has to do something about them. Yesterday in the Western Mail we had the headline :

"Urban aid package share out is attacked".

The article said :

"Dyfed County Council yesterday bitterly attacked its share of Wales's £20,600,000 urban aid package. The county's

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share, of only £48,000, was described by civic chiefs as bitterly disappointing, with West Wales being sacrificed at the altar of the Valleys Initiative."

The right hon. Gentleman has work to do ; he must tell areas outside the valleys that he is not robbing Peter to pay Paul, as it were.

Mr. Nicholas Bennett : The hon. Gentleman has quoted from yesterday's Western Mail. Has he seen today's issue with the headline :

"Investment in rural industries booming'"?

Underneath it says :

"West Wales is now witnessing a major rural investment boom."

Mr. Jones : The hon. Gentleman should tell that to Dyfed county council.

Mr. Allan Rogers (Rhondda) : The hon. Member for Pembroke (Mr. Bennett) has quoted the Western Mail as a definitive newspaper. During the recent by-election it was grotesque that the Western Mail and the South Wales Echo were taken over by the Welsh Office. At one stage we wondered whether the cost of their publication would be included in the Conservative candidate's election expenses.

Mr. Jones : It is "Walkervest" and "Walker Mail". That is in keeping with that newspaper over generations.

The £8 million for housing envelope schemes is welcome, but that amount could be used entirely by but one local authority in the valley areas.

Valley councils fear a stop-go policy on derelict land clearance schemes. A consistently high provision of cash is necessary, not just in one or two years. What specific extra funds will be given to deal with the awesome problems posed by our aging population in the years ahead? If the right hon. Gentleman has not thought about that, he had better start doing so in the context of the initiative.

Will the Secretary of State meet the valley communities to hear their response? Will he take the time to hear their views? Will he meet the local authorities with his junior Ministers, not just once but several times in the years ahead? The three-year programme is welcome, but if the initiative is to get off the ground it must run for at least eight years because continuity is all important. Surely the urban programme funding should be increased significantly. The valley councils clearly believe that the initiative can prosper only as a rolling programme. The Secretary of State instances 25,000 to 30,000 jobs in three years. What private enterprises will put their money into the valleys and who will pay for the infrastructure to facilitate such an advance?

Regional development grants are out, but the Secretary of State has included them in his package, having the cheek to talk of a massive increase in applications. The massive increase was because regional development grant was to be phased out within three months. That is typical of the right hon. Gentleman. Local authorities do not think that regional selective assistance will be sufficient to fill the gap that will be created by the loss of regional development grants. In a document published by the valley councils, they say : "It was surely deceptive to draw attention to a massive increase in applications', when the main reason for such an increase was the three months period given for firms to apply for RDG before it was removed. Obviously this ultimatum generated applications from firms who wished to protect their position, thereby beating the deadline".

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The councils use the word "deceptive", and it is that sort of approach that I want to warn the Secretary of State against. The initiative must work. The programme must be carried forward. The valley councils fear that their economic efforts will be secondary to those on the coastal plain. The Secretary of State must give some assurances on that. The Government's financial cuts have left valley road maintenance in a scandalous state. They say that the fabric of their roads may disintegrate entirely. Will the right hon. Gentleman make cash available to avoid that? Where are the proposals to upgrade the present antiquated three-lane sections of the heads of the valleys road? Surely upgrading that road is of fundamental importance to a strategy for the region. That is of prime importance, but the right hon. Gentleman did not refer to it.

The figures that the Secretary of State has given for housing are not enough. The total repair bill for the valleys is in excess of £300 million. The employment and financial status of many home owners is disturbing. That is the only word to use. A rolling programme for housing is necessary.

Let me remind the Secretary of State that the poll tax would be a devastating blow to his own initiative. How can his initiative revitalise the valleys when the burden of the poll tax will fall disproportionately on the valleys? The right hon. Gentleman's support of the poll tax undermines the very programme that he has been extolling to the House. Again, that is typical of the right hon. Gentleman. We want some answers from him on that issue. If he does not make money available over and above the normal provision, his initiative will fail.

It is daft for the right hon. Gentleman to include the improvement of hotels and pubs. Many brewery refurbishments were completed before the valleys initiative was announced. That has caused some hilarity in the valleys at the right hon. Gentleman's expense.

I have read the impressive response of the Committee of Welsh District Councils to the valleys initiative. I know that the Secretary of State has read it and I hope that he will meet members of that committee.

I support the idea of the valleys initiative. Much needs to be done to create jobs, to provide good housing, better health and better education and to improve the quality of the environment in the valleys. But the Secretary of State is an expert at gift wrapping. The paper is nice and shiny. The bow is beautifully tied. But when the right hon. Gentleman's parcels are unwrapped there is not much in them. We shall have to look carefully at his statements and examine them in detail.

The Secretary of State is willing to take the credit for the valleys initiative--he went to Merthyr to get it--but, he must share responsibility for the Government's policies and their impact on the valleys. The Opposition know that the Government's economic policy is at odds with the aim of the valleys initiative. Until the right hon. Gentleman can work that out we have a serious problem.

The Electricity Bill guarantees electricity for our Welsh people, but at a much higher price. It will have a serious impact upon the south Wales coalfield. It will encourage a flood of cheap imported coal and there is no guarantee in the Bill of security of supply in the mid-1990s. It is defective legislation.

The Local Government and Housing Bill continues Her Majesty's Government's attack upon local government in Wales. It guarantees large increases in council house rents.

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Those rent increases that the Government will force upon council house tenants are likely in turn to force tenants to buy their homes. In case the Secretary of State has not read it, I can tell him that his name is on it.

The Secretary of State's name also appears on the Education Reform Bill which has since been enacted. That Act goes overboard on testing. It puts a great deal of pressure on the primary school pupil and it ignores the current demoralisation of the teaching force and the need for money for staff in order to meet the demands that the right hon. Gentleman and the Secretary of State for Education and Science are making through the curriculum. Worse, it is potentially divisive.

Worse--if it can be worse--is the Water Bill. If ever there was one, here is an unwanted, friendless Bill. Its name could be "the great Welsh land sale". When last were some 85,000 acres of beautiful Welsh landscape put under the hammer? The Bill there virtually guarantees that the ownership of our own Welsh water authority will slide into the hands--the profit-hungry hands--of City institutions. That is to be the fate of the Welsh water authority. In respect of this Bill, the Secretary of State has been as weak as water. His name is on it. Why has no Welsh national rivers authority been mooted? My right hon. and hon. Friends and I say to the Secretary of State that he should have had Wales exempted from this Bill. Without a doubt, it is a stain on his reputation. The Secretary of State for the Environment--the right hon. Member for Cirencester and Tewkesbury (Mr. Ridley)--bested the Secretary of State for Wales in Cabinet. The Secretary of State for the Environment has overturned the right hon. Gentleman's own water reorganisation of 1973. If ever there was a departmental humiliation, this measure is it. However much the right hon. Gentleman may squirm, he knows that the Bill is a major defeat for him and his Department, yet he had the recklessness to put his name to it. It guarantees high costs, but does not declare a war on pollution or guarantee quality water, yet the right hon. Gentleman failed to have Wales exempted from it.

Then there is the Local Government Finance Act 1988. I have to tell the right hon. Gentleman that the poll tax goes against the Welsh people's instinct for fair play. As if he did not know it, the poll tax will bear heavily on the larger, poorer families of Wales. Women, too, will lose out. When the full impact of the legislation is measured, it will be seen that our valleys curse the poll tax and curse the right hon. Gentleman who failed to have Wales exempted from it.

We have also the White Paper on the National Health Service reforms. Does not the right hon. Gentleman know that these reforms are unwanted by patients, by nurses, by doctors and by ancillaries? Does he not realise that the White Paper is a lost opportunity? It contains no substantial proposals about how to provide quality care for the elderly--just a proposal for private health insurance and private beds. How can the average pensioner afford private health insurance? The Prime Minister should explain, because, despite the Secretary of State's disclaimer today, and despite his soft words and his honeyed phrases, there remains in Wales the suspicion that the Health Service is to be prepared for privatisation. I remind the Secretary of State that Mr. Aneurin Bevan, the

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