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Session 2000-01
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Standing Committee Debates
Welsh Grand Committee Debates

Budget Statement and its Implications for Wales

Welsh Grand Committee

Monday 12 March 2001(Cwmbran)

[Mr. Barry Jones in the Chair]

Budget Statement and its Implications for Wales

10.32 am

The Chairman: I am sure that all hon. Members would wish me to express our gratitude to Monmouthshire county council for agreeing to host this sitting of the Welsh Grand Committee. I particularly thank the chairman of Torfaen borough council, which shares the building, and the staff of county hall for making such thorough and efficient arrangements for us today.

I propose to suspend the Committee for one hour for lunch at about 1 pm. I remind hon. Members of the rules for the use of the Welsh language: they are free to move from one language to another as they choose, provided that those proposing to speak in Welsh give the Chairman notice in English of their intention to do so—at the latest when they are called to speak or to ask a question. Points of order are to be raised only in English.

Oral Answers to Questions

jf12The Secretary of State was asked—

Students (Funding)

1. Mr. Elfyn Llwyd (Meirionnydd Nant Conwy): When he last discussed funding of students' education at further and higher levels with (a) the Secretary of State for Education and (b) the First Secretary of the National Assembly for Wales; and if he will make a statement. [152750]

The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): My right hon. Friend and I have regular meetings with ministerial colleagues and Assembly Ministers to discuss a range of issues. The Government are committed to encouraging greater participation in higher and further education that is consistent with the policy on lifelong learning.

Mr. Llwyd (Translation): Given that answer, may I remind the Minister that the most recent figures show that the number of people trying to enter further and higher education in Wales has decreased by 5 per cent., whereas in Scotland in the same period it has increased by 15 per cent? Will he reconsider the policy of forcing students to pay tuition fees, as that undermines the all-important principle of education for all?

Mr. Hanson: The hon. Gentleman will be aware that tuition continues to be free for students from lower income families. About 45 per cent. of all students do not pay tuition fees and a further 20 per cent. will pay less than the full fee. I recognise that student hardship arises on occasion. I am sure that the hon. Gentleman welcomes the Assembly's announcement on 5 December that it had commissioned an independent investigation into student hardship, which will examine the issues to which he has referred in relation to the Scottish experience and the Cubie report. I shall reflect with interest on that independent investigation when it is completed.

Mr. Ted Rowlands (Merthyr Tydfil and Rhymney): Given the extreme importance of funding further and higher education, is my hon. Friend aware that recent figures show that 20 per cent. of the Welsh working population has no qualifications? In view of that, will he give maximum encouragement to funding the acquisition of qualifications, not only by those who are waiting to go into work, but by those already in employment, and will he give particular encouragement to the Chancellor's idea of a generous tax credit to employers to encourage training in the workplace?

Mr. Hanson: I am grateful to my hon. Friend for his suggestion. The Chancellor's employment credit policy to which he refers is important. My hon. Friend has consistently encouraged the Government, the Employment Service and agencies under the direction of the Assembly to work closely together to provide improved training, so that individuals can return to work and have their skills increased considerably. The Government and the Assembly are committed to improving the skills of those who do not currently have appropriate skills, and I am sure that we can examine the examples to which he refers.

Mr. Jon Owen Jones (Cardiff, Central): Is the Minister aware of the misapprehension that the Scottish deal on tuition fees is a good deal? It costs the Scottish block about £60 million, in return for which it receives, not an end to tuition fees, but a roll-up of tuition fees. All students pay £2,000 at the end of their course, whereas half the students in Wales pay nothing. Implementing the Scottish system would not only cost the Welsh block £30-odd million, but would make students from the poorest backgrounds £2,000 worse off. That does not sound like a good deal to me.

Mr. Hanson: As I said to the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd), tuition continues to be free for approximately 45 per cent. of students, and a further 20 per cent. of students pay a much reduced fee. The points that have been made will form part of the independent investigation by the Assembly, but important lessons are involved: the Scottish experience does not necessarily provide a panacea for further and higher education in Wales. My hon. Friend's points will be considered along with those of the Assembly in due course.

Mr. Lembit Ipik (Montgomeryshire): Does the Minister agree, despite some cynicism about the settlement in Scotland, that that settlement is a great deal better than what would have occurred had the Liberal Democrats not convinced our Labour partners in Scotland to tackle the issue of tuition fees? Does he support the Welsh Assembly's work to try to find a way in which to alleviate the terrible burden of tuition fees on students in Wales?

Mr. Hanson: I have said that the Assembly is considering those issues in relation to the Cubie report. I hope that the hon. Gentleman will take this in the best spirit, but the Liberal Democrats are always free to pick and choose whom they support in different Assemblies and Chambers.

Average Incomes

3. Mr. Win Griffiths (Bridgend): When he last met the Chancellor of the Exchequer to discuss the impact of fiscal measures on average weekly incomes in Wales. [152752]

The Secretary of State for Wales (Mr. Paul Murphy): I meet my right hon. Friend the Chancellor of the Exchequer regularly to discuss a wide range of topics. In his Budget last Wednesday, my right hon. Friend the Chancellor announced measures to build investment for the long term, building opportunity and prosperity for all. Incomes in Wales will benefit from changes such as the widening of the 10p income tax band and the increase in the minimum wage to £4.10 an hour. Our constituents are benefiting from high and sustained economic growth, employment, wealth and income growth, together with low inflation and low mortgage rates.

Mr. Griffiths: Can my right hon. Friend confirm that the overall impact of the Budget, especially the fiscal measures for individuals, will be that, proportionately, low-paid workers throughout the United Kingdom and especially in Wales gain far more than any other group?

Mr. Murphy: Yes, I can give my hon. Friend that assurance. As he knows, people in Wales have suffered for many years as a result of low incomes. I believe that the proposals in the Budget, together with the comprehensive spending review and previous Budgets, all suggest that those in Wales who are less well off and disadvantaged will benefit from the Government's actions.

National Minimum Wage

4. Ann Clwyd (Cynon Valley): What impact the increase in the national minimum wage will have on employment in Wales. [152753]

The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): There is little or no evidence of higher costs feeding into higher prices, or of a negative employment effect as a result of the minimum wage. Indeed, jobs are being created, especially in the service sector where the national minimum wage has the most impact. The policy is successful and has the approval of not only trade unions and the low paid themselves, but the Confederation of British Industry, small businesses and even the Institute of Directors, which has said that the national minimum wage has been a success.

Ann Clwyd: My hon. Friend is right. Does he agree that the minimum wage has been of particular benefit to the valleys of south Wales, where job prospects were decimated after the previous Government got rid of the coal industry? Many people were forced on to slave wages, and to areas such as the Cynon Valley, where wages were low. Obviously, we would like the minimum wage to be even higher and to approach £5 an hour; perhaps in future it will. Does he agree that more than 70 per cent. of those who have benefited most have been women and that the national minimum wage has done more for women's wages than anything else in the past 30 years since the Equal Pay Act 1970 was passed?

Mr. Hanson: We all agree that Labour Members can be proud of the minimum wage. Last week's rise to £4.10 an hour, which was announced by my right hon. Friend the Secretary of State for Trade and Industry, is welcome. It will, as my hon. Friend says said, most benefit women and people on the lowest incomes. I assure her that in a forthcoming general election, it will not be my policy to mention the fact that the Conservatives and nationalists did not vote for it and that the Liberal Democrats gave it lukewarm support. She can rest assured that that will not pass my lips during the election campaign.

Employment (North Wales)

5. Mr. Gareth Thomas (Clwyd West): What discussions he has had with the First Secretary about employment levels in north Wales. [152754]

The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): I regularly meet the First Secretary to discuss a wide range of issues including employment in Wales. The Government's economic policies continue to encourage investment in Wales and create more jobs. Recent investment in north Wales includes £17 million by Port of Mostyn Ltd. in Mostyn docks, which created 85 jobs in my constituency. An investment of £100 million by Toyota, Deeside, created 310 skilled new jobs in your constituency, Mr. Jones.


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Prepared 12 March 2001