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Mr. John Smith (Vale of Glamorgan): Before my right hon. Friend moves on from management of the economy, will he join me in welcoming the Prime Minister's statement earlier this week on preparations for a single currency? That statement went down extremely well with Welsh business and commerce. The devastation caused to our primary industries by the Conservative party over two

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decades has made Wales the region of the United Kingdom most dependent on trade with the European Union. The people of Wales will view the Opposition's policy of ruling out the single currency for 10 years with absolute disbelief in the run-up to the Welsh Assembly elections.

Mr. Michael: I agree with my hon. Friend. Despite the Opposition's attempts to spread confusion, the Prime Minister's statement was widely welcomed, particularly in Wales, by both business and farmers, on whom the policy will have a considerable impact.

Mr. Dafydd Wigley (Caernarfon): The Secretary of State mentions the substantial additional resources that the Treasury has put at the Welsh Office's disposal as a result of the economic management of the past two years. Will he give an assurance that the Treasury will be forthcoming with the matching funds that are needed to ensure that Wales can get the full benefit of objective 1 money, if we succeed in obtaining objective 1 status when the decision is taken next month? Is he prepared to put his own neck on the block in delivering that, given that, during the recent election campaign, he said that he could have such an influence on Government Departments in London?

Mr. Michael: I am delighted that the right hon. Gentleman is at last willing to lead with his chin in the House, as he does in the newspapers. Such an election ploy is obvious when it comes from his quarter, and it appears to be the only ploy that Plaid Cymru currently has, other than generally rubbishing the achievements of the Labour Government.

Mr. Wigley: Answer the question.

Mr. Michael: The right hon. Gentleman knows the answer--it is straightforward. When we have a decision from Europe, there will be discussions involving Treasury colleagues, in which we shall consider the way in which the UK Government will fulfil their obligations and enable Wales to draw down the finances available under objective 1 status, which we are satisfied that we shall be able to achieve.

Mr. Wigley: Will the right hon. Gentleman give way?

Mr. Michael: The right hon. Gentleman must be patient. He is not usually patient, as was shown when he rubbished the Government's attempts to get objective 1 status for Wales. He said that a Labour Government would not succeed in obtaining objective 1 status, but we did succeed. The right hon. Gentleman has not yet apologised for his misrepresentation but, in the fullness of time, he will have to do so.

Mr. Wigley rose--

Mr. Michael: Does the right hon. Gentleman want me to give way again?

Mr. Wigley: Yes, I do want the Secretary of State to give way. Does he accept that, months after Cornwall had made its application for NUTS 2 area designation and after the application was in from South Yorkshire, the Welsh Office were miles behind and nearly missed

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the boat? Had it not been that in March last year, at the last minute, the Welsh Office woke up to that fact, Wales would have totally missed objective 1 status. The danger now is that we shall miss the ability to make use of that status unless the Secretary of State wakes up and gets the Treasury on side. We in Wales are looking for an absolute commitment, not "ifs" and "buts" or "we shall see in two months time when the election is over". We want a categoric assurance and we want it now.

Mr. Michael: Listening to that artificial rant, I thought that Rod Richards had rejoined the House of Commons, for the right hon. Gentleman is singing a Tory tune. He knows that the content of his remarks is as artificial as the tone in which he made them.

Mr. Wigley rose--

Mr. Michael: The right hon. Gentleman should listen for a moment. He knows that questions about how the money will be delivered and how the UK Government will deliver on their responsibilities cannot be asked until the details have been received from Brussels.

Mr. Wigley: Of course they can.

Mr. Michael: Perhaps the right hon. Gentleman should read the comments of Professor Kevin Morgan. In contradiction of the press release that was wandering around yesterday suggesting that there was a problem--no doubt it was inspired by someone close to the right hon. Gentleman--Professor Morgan confirms that the Welsh Office is playing the process absolutely right. The Welsh Office played the provision of evidence for objective 1 status absolutely right, which is why we are on the verge of winning it. While we are on the subject, what happened to the case of champagne that the right hon. Gentleman promised Welsh Office Ministers? It does not appear to have arrived yet--although, in the interests of objectivity, perhaps it should be delivered to you, Madam Speaker, rather than to Welsh Office Ministers.

I say in all seriousness to the right hon. Gentleman that he must not talk Wales down or try to undermine the position of the Welsh Office in negotiations with Ministers in other Departments and with Europe. We shall do the job for Wales, I promise, and no rant of his will improve our position. I ask him to think seriously about the comments he makes and to contribute to debates a little more responsibly than he contributed to this morning's Western Mail.

Mr. Wigley: Will the right hon. Gentleman give way?

Mr. Michael: Of course I will give way.

Mr. Wigley: I am grateful. Of course, I keep my promises--and I will provide a crate of champagne that the right hon. Gentleman and his predecessor can share when Wales gets objective 1 money. I ask only for an equal promise and commitment that the Treasury will provide matching funds.

Mr. Michael: As I said at the outset, I recognise the right hon. Gentleman's election ploy of asking a question that he knows will be answered in the fullness of time

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as a result of the discussions that we will have with our colleagues in Government. I promise the right hon. Gentleman that we will fight Wales's corner as strongly within the United Kingdom Government as we will fight it in Europe. I give that pledge to the right hon. Gentleman and the House in all seriousness. I accepted this job and chose to stand for the position of First Secretary to the Assembly in order to fight Wales's corner, and I promise the right hon. Gentleman that I will deliver.

Mr. Alan W. Williams: I congratulate my right hon. Friend and his predecessor on winning objective 1 status for Wales. He has presented a patient, long-term argument, and I admire my right hon. Friend for now pressing for matching funds. Having listened to the ranting and raving of the right hon. Member for Caernarfon (Mr. Wigley), it comes as no surprise to learn that Caernarfon has the highest unemployment in Wales. That is what ranting and raving does: it destroys jobs. We want the quiet, tactful diplomacy and the hard work that my right hon. Friend will bring to his task.

Mr. Michael: I am grateful to my hon. Friend for his comments. I do not wish to get involved in a personal debate with the right hon. Member for Caernarfon (Mr. Wigley), but he is correct in saying that serious work must be done in Government. I pay tribute to my predecessor, my right hon. Friend the Member for Caerphilly (Mr. Davies), and to the junior Ministers, for playing their role in completing the day-to-day work so that we may now hope to receive objective 1 status shortly. We then face the serious task of transforming the Welsh economy. We have created a national strategy for Wales in which we are engaging every sector of the economy. That is a serious job, and I look to Opposition Members, as well as to my right hon. and hon. Friends, to show unity in fighting the cause for Wales rather than creating divisions within Wales.

Mr. Richard Livsey (Brecon and Radnorshire): We have heard some rather ranting rhetoric in the past 10 minutes. Does the Secretary of State agree that it is most important to work now on projects for objectives 1 and 2 status? Communities in Wales must work very hard to ensure that they attract objective 1 funding and so create more employment in Wales.

Mr. Michael: I agree with the hon. Member for Brecon and Radnorshire (Mr. Livsey), who makes a positive contribution to the discussion. Much work is being done at present to develop the strategy, which will be open for consultation as soon as it is completed. It has been an open and participative process. I agree entirely with the hon. Gentleman that organisations and bodies throughout Wales should consider submitting applications, not just for objective 1 status, but in all areas where we are offering support--whether it is sustainable development through the strand of funding that I launched when I visited the hon. Gentleman's constituency, or through the strand of social inclusion.

On that point, I refer the House to two themes that are drawn from all that I have put before it today: partnership and social inclusion. They underpin a great deal of what the Government are seeking to achieve in Wales. We are

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working in partnership with local government, the voluntary sector, business and trade unions. The Welsh Office is no longer a fortress ruled by an out-of-touch and alien Tory high command, but a team that looks outward for inspiration, ideas and assistance in creating a new and more prosperous Wales. The National Assembly will be in a strong position to build on those achievements.

Promoting social inclusion is at the heart of my policies for Wales and informs all of the specific strategies that we have developed for Wales. Our economic strategy, "Pathway to Prosperity", is about tackling low incomes and spreading prosperity to the valleys and west Wales. The "Building Excellent Schools Together" and the "Learning is for Everyone" strategies for education are about tackling the skills and qualifications deficits that keep people out of mainstream opportunities. The "Better Health, Better Wales" strategy is about finding radical new ways of tackling the appalling health problems that afflict those who live in our poorest communities.

As well as that crucial mainstream work, we are investing in targeted strategies for the most vulnerable groups and the most excluded communities. I particularly want to highlight the social inclusion fund to which I have allocated £48 million over the next three years. We shall use that money to stimulate new approaches to fill gaps in service provision and make more effective use of mainstream resources to push forward our onslaught on social exclusion.

Soon, I shall consult the Welsh Local Government Association about how best to use those resources to tackle the most pressing issues, with a specific commitment and priority to reduce the risks of social exclusion among young people in Wales.

Our aim is to make a difference to the prospects of everyone in Wales, including those at the bottom of the heap, and I have absolutely no doubt that it will be at the top of the Assembly's agenda. Success means finding new approaches and doing what we are doing, but in better and smarter ways, so that we can invest in what works, in partnership with agencies. That will be central to the work of all public agencies in Wales.

I am grateful for this opportunity to report on some of the Government's major achievements in Wales and the work ahead. There have been achievements and progress on many fronts. In future, we must build on the work towards winning European Union objective 1 funding for a major part of Wales. Our policies also include support for enterprise and small businesses; assistance to farmers at a time of crisis and efforts to add value to our agriculture; and measures for the environment, sustainable development and equal opportunities.

There is also a range of wider issues on which we are delivering more than we ever dared hope, such as incorporation of the European convention on human rights into UK law, the minimum wage, reform of the House of Lords and much more. Such matters affect the quality of life and future hope for people in Wales.

I should also mention transport, which we debated at length in the Welsh Grand Committee at Aberaeron this week. Returning from that meeting, I had to stand on a Sprinter train for the 50 miles between Neath and Newport because of the cancellation of the InterCity service. I suspect that if that had occurred before the debate, the points made by hon. Members of all parties

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about rail services would have been a great deal stronger and more heated. That was a salutary reminder of how much work is still needed to make good the damage done to our transport system by 18 years of Tory Government.

At least I was in good company with the Under-Secretary of State, my hon. Friend the Member for Neath and officials as well as members of the public, who made it clear that their patience and good humour should not be taken for granted--they want the problems sorted out. That is why I am delighted that the Deputy Prime Minister, backed by the Prime Minister, is leading the transport summit, to demonstrate how important it is to drive forward change and improve transport services.

We have made great progress but we have much to do. I am pleased to say that the National Assembly for Wales will inherit a live and active agenda with many challenges, but also with the foundations, the flexibility and great opportunities to deal with the issues of greatest concern to the people of Wales.

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