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Mr. Evans: I wish to make a short contribution in the guise of a few questions to the Minister. He will be delighted to learn that normal hostilities have resumed after new clause 38. I apologise for my raw voice, but I was at Twickenham on Saturday: never has so much energy been expended for no good purpose.
I asked earlier about the vital European Union regional aid that is channelled to rural Wales. What has happened in the discussions about revising the way in which that aid is calculated? The calculation is to be based only on unemployment, which will disadvantage whole swathes of
Wales in favour of other areas, including some parts of Spain, that are thriving. It could put a £1 billion hole in expenditure for Wales.
The Development Board for Rural Wales was established in 1977, and has successfully examined specific problems, such as depopulation in rural areas, and vital issues such as public transport, social housing and industrial investment in rural areas. It serves 40 per cent. of Wales. When the board is meshed into the super-quango, how will the Government ensure that its remit extends sufficiently to rural areas? A favourable reply would render these amendments unnecessary.
We must not lose sight of the reason why the Development Board for Rural Wales was invented. Rural areas must not be disadvantaged or forgotten because of extra demands on the WDA. Much has been said about LG coming to Newport and creating 6,100 jobs. That employment is vital--as is the spin-off of between 9,000 and 15,000 extra jobs--and the whole of Wales will benefit from it. Do the Government have any plans to bring the Wales tourist board within the remit of the Welsh Development Agency? Tourism is vital for rural Wales.
Another remit of the DBRW was its support for farming. Will that remit be taken on by the Welsh Development Agency? That question is particularly important in the crisis currently facing Welsh farming.
In an earlier debate, it was mentioned that the DBRW had a remit to steer a certain percentage of development away from the M4 and A55 corridors. That is extremely important, as there are parts of south-west Wales into which it is difficult to attract inward investment, whereas it is much easier to attract it into areas such as Newport and along the M4 and A55 corridors.
Can the Minister tell us what is to be the steer for the new super-quango? Will it be to ensure that a specific percentage of the inward investment that comes into Wales finds its way into rural areas, away from the main corridors? As new clause 38 deals with sustainable development, I assume that it is intended to allay fears for rural areas.
Having kept my contribution brief, I hope that that will leave a little more time for the Minister to cover those points.
Mr. Denzil Davies:
I have considerable sympathy with the amendment which, as my hon. Friend the Member for Clwyd, West (Mr. Thomas) said, seeks to ring-fence rural affairs within the DBRW. For economic, cultural and social reasons, it would be a tragedy if the new quango neglected rural affairs. It may be unrealistic, as my hon. Friend suggested, to expect that the agency would ring-fence rural affairs.
I shall put two questions to my hon. Friend the Under-Secretary. First, what about the money? We are discussing not just a merger of three bodies--quangos--but an extension of powers. With regard to social development, there will be an extension of powers wider than the present Meirionnydd, Powys and Cardiganshire. Social development will go to all the rural areas outside that area covered by the development board, and to urban areas.
The new super-quango will have increased powers over those areas in that sphere. Will it have to make do with the same amount of money, plus annual increments, as is
now geared to its existing powers, or will it have more money to enable it to perform its new functions, as set out in the amendment? Those new functions will need money. If new money is not forthcoming, money will be taken from existing functions. People will put pressure on the new quango for social development money, if I may so describe it, in areas outside the present development board areas.
My second question, which was also raised by the hon. Member for Ribble Valley (Mr. Evans), is: what about farming? Farming was not thought of as industrial, and so was probably not considered to be within the original remit of the WDA. Now that the reference is to business, which can be industrial, commercial or professional, it must obviously cover farming, especially when it is said that the business does not need to make a profit--we all know that farmers do not make any profit.
On a legalistic reading of this legalistic document, farming would be included under economic or social development. There are clear social ramifications to farming in rural Wales. I should have thought that farming would fall within the remit of the new social and economic powerhouse, unless the European Community claims that it is the only body allowed to spend money on farmers. If that is not the case, there should be a glimmer of hope for farmers under the new, more powerful super-quango. Will more money be provided for that purpose?
Mr. Livsey:
I commend the remarks of the right hon. Member for Llanelli (Mr. Davies). One of the huge problems of the DBRW was that it could not support farming because it did not have the powers under the legislation that set it up. There were many frustrating moments when we were unable to support the agricultural industry with co-operatives for the marketing of lamb and so on during the 1980s. It would be a great advantage if farming as a business could be incorporated into the remit of the agency.
I strongly support the amendment and congratulate the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) on tabling it. There must be redress in the rural areas, through the creation of a rural affairs department. I have long advocated an additional Welsh Office Minister responsible solely for the rural areas. The Under-Secretary is responsible for other matters, such as education under the previous Administration, and health under the present Government. Such is the importance of the rural areas that they deserve a strong focus.
I agree with the hon. Member for Clwyd, West (Mr. Thomas), who said that the resources should be ring-fenced. As a consequence of amalgamating the bodies, resources may find their way to the centre. I hope that I am wrong. We have heard an analogy with rugby. It is significant that one of the reasons why the English rugby team is so successful is that a certain proprietor of The Sun has enabled an £85 million deal to be done. It is ironic that the Government gave an £85 million support package to agriculture recently, but that was across the United Kingdom. Only £12 million of that came to Wales, so we are losing out again.
We must demonstrate the needs of rural Wales. Agriculture is vital. In some parts of Wales, 25 per cent. of the population is engaged directly in agriculture or in support industries. Family farms are in crisis. The farm
management survey figures for the year 1997-98 suggest that farmers in Wales will earn only £2.50 an hour on a 40-hour week, and in 1998-99 are unlikely to make anything at all. We have heard reference to sustainability--we need sustainable incomes as well.
I know of many instances where rural businesses have collapsed in mid-Wales.
Mr. Öpik:
Does my hon. Friend share my view that there has never been a more important time to get support right? The closure of DC Evans in Newtown and Welshpool has cost 35 jobs, and the closure of the former Laura Ashley factory--now called Merchant Design Manufacturing--in Machynlleth cost 60 jobs. People are looking to the Bill to provide real support, so that a rural crisis is not allowed to turn into a deep and lasting recession.
Mr. Livsey:
I know that my hon. Friend has had many problems in his constituency as a result of the crisis to which I have referred.
Social development, which has already been debated, is extremely important. In the context of rural affairs, national parks are similarly important. One of the purposes of a rural affairs department must surely be to hammer out a rural strategy in conjunction with the assembly. That will create something coherent for the rural areas of Wales.
Amendments Nos. 524 to 539 relate to the transfer of powers from the Development Board for Rural Wales to the Welsh Development Agency. The use of the word "transfer" is extremely important as it identifies what will and should happen. As I have said, we have already debated the transfer of powers for social development.
Business Connect for Wales has given an excellent service throughout the DBRW area and it has been a great success, but it requires staff to service it with expertise. A report yesterday referred to the possibility of 60 jobs being lost in the DBRW. If that happens, it will not be possible to service a business connect network throughout rural Wales. That is serious. We must demand answers.
I have two questions for the Minister. How does he intend to maintain the rural premium in funding the new agency to ensure that the Government's stated aim, which is to see effective business development delivered throughout Wales through business connect, is achieved? Secondly, how is the Minister using the funding mechanism of the new agency to ensure that its new divisional structure delivers the quality and extent of service that he says he wants to see, given that there is the possibility of staff reductions? I should say that that possibility was denied yesterday, but I hope that the Minister will refer to it.
The rural premium, because of sparsity, has been £100 per person in the DBRW area. It used to be £605 per person in the WDA area, but that premium has been subsumed. It has found its way into local authorities and has been lost. Will that happen to the rural premium, which has been made available with success, in the DBRW area? Perhaps that puts the question of the ring-fencing of resources back into the park.
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