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The Parliamentary Under-Secretary of State for Wales (Mr. Peter Hain): I apologise for intervening, but it is important to record the fact that "Pathway to Prosperity" was available to Members of Parliament at the same time as it was to the press conference. A parliamentary question was also answered at that time.

Mr. Livsey: I acknowledge what the Minister says, but we expected the document on Monday--it slipped out yesterday. We were not aware of its existence until well into the day. I have just been told that envelopes were made available during the morning, and, if that is true I apologise. I was not aware of that, and neither was the

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Vote Office because, when I asked for the document, it did not know that it existed. There is something wrong somewhere, as they say in some parts of the press.

I want to move on because many hon. Members want to speak. A Welsh Office Omnibus survey carried out in 1995 showed that almost a third of households in Powys suffered from some social deprivation and that almost one in six households suffered from material deprivation. Those figures were much higher than for Wales as a whole and they were much higher than for Dyfed. As I said, in many economic indicators for Wales, Powys is lumped with Dyfed. For example, the GDP figure is averaged out at 76 per cent. for Dyfed and Powys combined. That is not a satisfactory way to proceed and it must be put right.

The right hon. Member for Caernarfon stressed the needs of the valleys and west Wales. I am well aware of those because I lived in west Wales for many years. However, the needs of Powys are being lumped in with a NUTS 2 area excluded from Powys. We are not in the same income league as north-east or south-east Wales. We have many needs, but have practically no infrastructure--we do not know what an A55 or a motorway is.

Mr. Chris Ruane (Vale of Clwyd): What representations has the hon. Gentleman made to the Welsh Office for his county? Is he aware that the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd), my hon. Friends the Members for Clwyd, West (Mr. Thomas) and for Clwyd, South (Mr. Jones) and I made strong representations to the Welsh Office at the 11th hour and managed to get Denbighshire and Conwy included in the objective 1 bid? What measures did the hon. Gentleman take to ensure that his county was included?

Mr. Livsey: The only official figure was 76 per cent. of average GDP, which, as the hon. Gentleman will realise, does not qualify for objective 1 status. The figures for Powys are lumped in with those for Dyfed. The county council had to commission and pay for a special study by Bristol university to produce many of the statistics that I am quoting in the debate, and that is not good enough. I want the Minister to promise that Powys will be considered for objective 2 funding from European Union structural funds because that is vital.

In future, we want better statistics about Powys. We know that it is very difficult to collect data for Powys because it is the most rural area in Wales. None the less, we need them.

Mr. Lembit Öpik (Montgomeryshire): Does my hon. Friend agree that the people of Powys and we, as their representatives, have repeatedly impressed on Ministers, until they have probably become sick of hearing about them, the difficulties of rural poverty in our area and the need for objective 2 status?

Mr. Livsey: I certainly agree with my hon. Friend.

I realise that time is short, but I want to address one or two important issues; otherwise, as an agriculturist, I should be doing less than justice to the present crisis in rural areas. We are approaching common agricultural policy reform, which is very important for our family

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farms. CAP reform, as it affects rural Wales, must take into account the family farm structure, which differs from that in England. We must examine modulation and direct payments to farmers in the context of CAP reform. Direct payments will certainly be allowable within the context, for example, of the World Trade Organisation negotiations. It is vital that our family farm structure is maintained.

In the past two years, farm incomes have reduced by 90 per cent. Many of our farms are no longer viable--in fact, at DM3 to the pound, they are bankrupt. All these issues are causing enormous stress to farming families in rural Wales. I beg Welsh Office Ministers to influence the Chancellor to change his policy of high interest rates and high valuation of the pound to assist agriculture.

We are also having great problems with the domination of the supermarkets in purchasing livestock throughout Wales. I should be grateful if Ministers would take account of the Welsh Affairs Select Committee's report, which called for an investigation by the Office of Fair Trading, particularly into the marketing of meat through supermarket outlets and the possible problem of excess profits being made in that way and rock-bottom prices being received for livestock in markets in Wales.

We need--I am grateful that this is recognised in the "Pathway to Prosperity" document--much more effort in co-operative marketing of Welsh produce from our farms and added value for that produce so that more income can be generated in rural areas. That matter needs urgent action.

The creation of the Welsh Assembly and its start-up next year will undoubtedly assist the economy of rural Wales. The assembly's committees, particularly those that will focus on economic development in conjunction with the strategy for the Welsh Development Agency and the powerhouse, will certainly bring great benefit. However, those plans are long term--perhaps too long term for some parts of Wales that need immediate assistance.

The quangos must be made more democratic and responsive to the needs of many parts of rural Wales. I make a special plea for our local authorities, which need much more assistance and more generous support from the Welsh Office. I hope that Ministers succeed in their negotiations with the Treasury for the block grant so that local authorities can have greater assistance in the coming financial year. The Government will, I hope, propose targets for greater activity by local authorities, which have huge responsibilities throughout Wales and which, on the whole, have an excellent record of doing a good job.

Once again, I make a plea to the Minister on behalf of rural areas. In the past three months, 86 jobs have been lost in Powys from rural businesses. That may not sound like many, but if one examines the statistics, one realises that 100 jobs lost in Powys are the equivalent of 1,000 jobs lost in Merthyr. Those jobs are a huge loss. Some agricultural merchants have closed, as have two machinery firms in Powys. A multinational company has closed its feed mill. Many such closures have occurred. They may not be writ large on the pages of the Western Mail or the Liverpool Daily Post, but they are severe blows to some of our more remote rural areas.

The assembly has a huge task to improve the lot of people living in disadvantaged areas of Wales. Much poverty in urban and rural Wales must be dealt with. I know that Ministers' hearts are in the right place, but we need action.

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11.56 am

Mr. Chris Ruane (Vale of Clwyd): I congratulate the right hon. Member for Caernarfon (Mr. Wigley) on securing this important debate. I agreed with about 95 per cent. of what he said.

My county is hit particularly hard in a number of sectors. In the heavy industrial sector, we lost the Point of Ayr pit, which is on the outskirts of my constituency and used to employ 700 people. In the light industrial and service sectors, 1,500 jobs have been lost in my constituency in the past four months. Traditional British seaside tourism is in decline, which some say is terminal. Two of the biggest towns in my constituency--Rhyl and Prestatyn--have experienced that. Denbighshire has a large rural area which has suffered enormously in recent years. It has an abysmal record of attracting inward investment--that has created only 89 jobs in the past four years. I therefore share the opinions of the right hon. Member for Caernarfon.

I shall try to stress the positive aspects. We are very close to achieving objective 1 status for Wales. Last week's announcement by Eurostat that it has accepted the NUTS 2 map for Wales could provide the springboard for the long-term recovery of the Welsh economy. I am informed by Welsh Office civil servants that that would allow Wales to tap into £1.8 billion between 2000 and 2006. We have now jumped the biggest hurdle for achieving objective 1 status, but we are not there yet. Important negotiations must take place and decisions must be made before we have access to that money.

It is time to reflect on our success to date. Before we try to jump the final hurdles, we should assess our success so that we can go into the final straight invigorated and more determined than ever to secure the best possible deal for the people of Wales. There are many unsung heroes in the fight to gain objective 1 status. Many of the main movers have been castigated for their role. I want to take the opportunity to redress the imbalance and to mention a few of those key players.

I pay tribute to the work of the Under-Secretary of State for Wales, my hon. Friend the Member for Neath (Mr. Hain). I extend to him my heartfelt thanks, on behalf of the people of Denbighshire, for his decision to allow, at the 11th hour, Denbighshire and Conwy to be included in the objective 1 bid for Wales. My hon. Friend the Member for Conwy (Mrs. Williams)--who, unfortunately, is in hospital for two months--has asked me to pass on her heartfelt thanks on behalf of her constituents.

The acceptance of Denbighshire and Conwy has extended to two of the most economically crippled counties in Wales the opportunity to share in a huge aid package. I remind hon. Friends of the plight of those two counties. Conwy has had the worst record of foreign inward investment in Europe--no jobs have been created by foreign inward investment in the past five years. The county has the lowest pay rates in the country and the lowest gross domestic product in Wales. Denbighshire, my county, has experienced 1,500 job losses in the past four months--800 jobs at KwikSave Group, whose national headquarters in Prestatyn have relocated to Bristol, 180 jobs at Hotpoint, Bodelwyddan, and 50 jobs at Egatube in St. Asaph in the past eight weeks alone.

Some people urged my hon. Friend the Under-Secretary to forget about Denbighshire and Conwy because, they said, their inclusion so late in the day would threaten the

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objective 1 bid for the rest of Wales. They said, in ignorance, that the inclusion of Denbighshire and Conwy would raise the GDP level of the Welsh objective 1 bid above the crucial 75 per cent., which would have excluded us--despite the fact that Conwy has the lowest GDP in Wales. Some people said that Denbighshire and Conwy belonged to the prosperous north-east region or sphere of influence in Wales, and that to include the two counties would produce a NUTS 2 region that was not cohesive or coherent--despite the fact that, historically, geographically and linguistically, the two counties share more with west Wales, and therefore should be included in the west Wales and valleys bid.

My hon. Friends the Members for Conwy, for Clwyd, West (Mr. Thomas) and for Clwyd, South (Mr. Jones) and the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) and I put the case for Denbighshire. My hon. Friends the Members for Conwy and for Clwyd, West and I countered the opposing arguments strongly with facts, figures and logical argument. Many of those opposed to the inclusion of Clwyd and Denbighshire would not listen. I am pleased to say that the Under-Secretary did listen. He listened carefully to our case and, after due deliberation, he included the two counties. Many were upset by that decision, but he stuck to his guns and did not waver in his support. He was truly a good shepherd, who looked after his entire flock, maximising the area and population covered by the Welsh objective 1 bid.

I pay tribute to the work of my right hon. Friend the Secretary of State for Wales. He spoke up in Cabinet for the Welsh case for objective 1 status. I commend him for the way in which he acquitted himself in that task. He carried the Welsh case forward, convincing his Cabinet colleagues and the Prime Minister that Wales had a fair and just case for objective 1 status. He had to do so in a Cabinet whose other members represented other areas that wanted objective 1 status.

The Secretary of State's calm and measured approach paid dividends. The Welsh case received the backing of the Cabinet and the Prime Minister. Some people openly criticised the Secretary of State for not being blatant, dogmatic and vociferous. If my right hon. Friend had adopted that approach, he would have jeopardised the Welsh case in Cabinet instead of aiding it. Many of those accusations were not responded to. He took the statesmanlike approach, put his country before political sniping and let the accusations go unchallenged, for to answer them would have distracted his attention from his main goal--that of achieving objective 1 status for Wales.

I congratulate other Ministers on their role in connection with the objective 1 bid, including the Minister for Small Firms, Trade and Industry, the Economic Secretary to the Treasury and the Minister for the Regions, Regeneration and Planning. Their guiding principle was "fairness not favours". They have shown themselves ready to hear the cases put by all Members of Parliament, from all areas and all political parties. Their every word and intonation on objective 1 matters was subjected to detailed examination. They have walked a political tightrope. Some hon. Members challenged those Ministers to declare openly their support for the Welsh objective 1 case. For a Minister to do so would probably have meant the end of that Minister's career, and it would definitely have meant the end of the Welsh objective 1 bid, because favouritism would have been seen to have preceded fairness.

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I thank the individuals, institutions and organisations who provided the hard-headed facts that enabled the debate to progress. I include among them the staff of the Library--I do not know whether I am allowed to name any individual, but I especially want to mention Jane Dyson, now Jane Hough. I also want to mention Cardiff business school and the Wales European Centre. They provided the factual information that was lacking. I share the concern of the hon. Member for Brecon and Radnorshire (Mr. Livsey) at the paucity of factual information available. I believe that that was due to the fact that Wales experienced local government reorganisation, and those facts were not available on a unitary authority basis. However, the Library and others dug out the facts, enabling us to prove our case.

The purpose of my contribution has been to recognise our achievements to date and to pay tribute to those who have worked behind the scenes, out of the glare of publicity, carefully making the case for Wales. I hope that, by recognising and celebrating our achievements to date, we can go forward with high morale, refreshed and united, in the final stages of achieving objective 1 status for Wales.


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