Budget Statement and its Implications for Wales

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Mr. Nigel Evans (Ribble Valley): I give my commitment to limit my contribution to 10 minutes, but I must advise hon. Members that a plethora of interventions will add time on. I, too, add my thanks to you, Mr. Jones, as Chairman of the Committee. We are sad that you have decided to retire from Parliament. The House of Commons and the Welsh Grand Committee will be the poorer for your going and we wish you well in your retirement. The hon. Member for Brecon and Radnorshire is retiring, and other members of the Committee may also be standing down. The hon. Member for Witney (Mr. Woodward) is still looking for a seat and we know how welcoming Wales has been in the past to those who have looked for greener seats. Any criticism that I may have concerning the Budget and Wales must not be regarded as my talking down Wales, but as constructive criticism. We do not yet live in a Soviet bloc totalitarian regime; constructive dialogue is always useful.

Agriculture and rural Wales are uppermost in all our minds. Farming has been in a crisis for a few years, but what is happening now is the worst crisis that it has faced in more than 60 years. I suspect that it is the worst crisis that any of us has seen. It has obvious and immediate consequences for farmers and those who rely on healthy agriculture. Added to those woes is foot and mouth, which has deeper complications and consequences for rural Wales.

Wales relies tremendously on tourism. It is a beautiful country and attracts an enormous number of tourists throughout the year. The crisis has meant that the tourist industry is cautious about what it does; understandably so. It does not want to add to the plight of our agricultural areas. Several businesses, from bed-and-breakfast accommodation to hotels, are being affected. The postponement of rugby internationals has had enormous and immediate consequences for urban areas. Little tea rooms, coffee shops and gift shops rely on an influx of visitors to Wales; that is drying up. Several such businesses have been operating on the margins for years and they are now looking for some form of help.

The crisis is continuing and we read that the Government are considering the consequential damages of foot and mouth. I plead with the Secretary of State and the Minister to consider those businesses that are in danger of going under. Several operate on loans or mortgages from the bank. Their trade is drying up and they cannot survive for much longer. Without some support from the Government, they may go bankrupt and future tourism will be eroded. The outbreak will damage rural Wales enormously.

Mr. Wigley: Is the hon. Gentleman, as the Front-Bench spokesman for the Conservative party in Wales, giving an undertaking that a Conservative Government would help those sectors?

Mr. Evans: In a spirit of consensus, I say to the right hon. Gentleman that we recognise the depth of the problem in Wales. I shall certainly be making representations throughout my party that some form of compensation for consequential damages must be made in Wales where tourism in so important. Consideration must be given to those areas that rely on rural tourism. We know that such problems are not restricted to Wales; similar businesses face similar problems in parts of the Lake district, for example.

The Government are the Government of the day. The problems that exist are today's problems and I hope that the Government can do something about them. Yesterday, The Observer reported that business losses are about £100 million a week. That is an enormous body blow to several small businesses, perhaps family-run, that employ occasional staff. Some of them employ either the wives or families of those who rely on farming. On the one hand, they have been hit by the farming crisis; on the other, businesses that rely or depend on a healthy agriculture and rural life are being doubly hit. It is a deep crisis.

I appeal to the Government to think again about their priorities. It is absurd to give legislative time to the attempt to ban hunting with dogs when we should be spending all our time on considering how we can help the agriculture industry. I hope that Lord Donoughue's suggestions will be given more serious consideration in another place.

I do not need to stress that farming is in deep crisis. Incomes have dropped dramatically; in some cases, to well below the minimum wage. I hope that the Government will be more sensitive about the needs of farmers. In relation to foot and mouth, we should look again at what can be done to involve the Army in disposing of some of the stock that is lying around.

The Budget must be looked at in the context of other Budgets in the past four years. It is amazing that, within a few weeks of a general election, the Budget is handing some of the money back that has been taken away from families and people in Wales for the past four years. We know that the stealth taxes that have been introduced, one after the other—there have been about 45 during the past four years—have taken the equivalent of a 10p rise in income tax from the people of Wales. The Government are giving 1p back in this Budget, just weeks before a general election. We know that the Chancellor of the Exchequer has tax raising form—it is in his blood, and it is his ethos—but, weeks before a general election, he is trying to go straight. If the nightmare happened and the Labour party formed the next Government, the Chancellor will return to his tax-raising ways. We cannot allow that to happen.

Rural areas especially have been hit by tax rises on petrol and fuel; 16p on a litre over the past four years. The Budget has given 2p back, and we are supposed to start organising street parties to welcome this great news. We do not welcome it. A year ago, there was a 75p increase for pensioners. A few weeks before a general election, the increase is substantially greater. Again, we are supposed to start ringing the church bells in celebration of the Government becoming enlightened to the fact that the 75p increase last year was a gross insult.

Mr. Alan W. Williams: Was not the 75p increase precisely in line with the formula that was used for 18 years? Is not the £5 a week increase that pensioners will receive the biggest-ever rise in pensions?

Mr. Evans: I would have thought that the hon. Gentleman would use his opportunity to apologise for the 75p increase, and to say that the Government got it wrong and looked at the matter again. He must now learn that his party is in government and has control of the purse strings. It is interesting that, in the first few years, the Government were extremely frugal in relation to pensioners, but a few weeks before a general election they are doling the money out. I do not believe that the pensioners of Wales will be deceived for a single moment. They will judge the Government in the context of the past four years.

The hon. Member for East Carmarthen and Dinefwr's remarks about farming and those involved in hunting with hounds were completely insensitive. He was effectively saying, ``Some jobs will be lost because of the ban on hunting with hounds, but those concerned can always go into other jobs that we are creating.'' Skilled people working in industries associated with hunting with hounds are doing what they want to do. I find it totally perplexing that the hon. Gentleman welcomes the fact that the Government are providing legislative time so that those jobs can be destroyed.

Mr. Ipik: Is the hon. Gentleman aware that there might be budgetary implications of the banning of hunting with dogs? The police might need enormously increased resources to look after the countryside.

Mr. Evans: I welcome the hon. Gentleman's comments. If the Government make something illegal, they must ensure that it is properly and effectively policed. There will have to be a further increase in police numbers; that will have cost implications, or the police will be pulled away from other duties. Violent crime has increased in Wales; the police should be concentrating their time on that, not on new crimes the creation of which means that the Government will persecute currently law-abiding citizens. That is completely wrong.

I welcome the announcement on VAT simplification for small businesses. We need to see the detail, because several smaller businesses, including my own in Swansea, spend a lot of time on paperwork and pay accountants to do the paperwork with which they do not have time to deal. We need a simpler way of raising revenue, especially from smaller businesses.

I welcome the announcement of the abolition of stamp duty in areas with genuine and severe problems, but it should be pointed out that the Government have increased stamp duty time and again. I shall not detail the problems that the Federation of Small Businesses listed in its document, as I have done so twice before. However, the lack of support for the plight of such businesses means that the matter deserves another airing; perhaps I shall do so later.

We have heard a lot about job losses, especially in the manufacturing sector. Those job losses worry me. Admittedly, other jobs have been created, and we welcome those. Indeed, such changes took place under the previous Government, with jobs created to replace jobs lost.

The manufacturing sector is proportionately more important to Wales than to other parts of the country. Last week the Chancellor could have provided an opportunity to reconsider the climate change levy and the impact that it will have on manufacturing jobs in particular. He lost that chance. I urge the Secretary of State to ask the Chancellor of the Exchequer to consider that impact. If manufacturing jobs are lost, other jobs—worthy though they may be—may not match up to the skills of some members of our manufacturing force. Those skills might attract other businesses to Wales. We need a strong manufacturing base, and it is being damaged.

In the Budget, the Government could have done a great deal more to help families, as well as small businesses and manufacturing in Wales. After four years of tax rises and of rules and regulations, the Government—in one Budget, announced weeks before a general election—do a little to repair some of the damage that they did before. Some would say that it is a great shame that we do not have elections every year, because the Government might be a bit more careful and consider how to help the people of Wales.

Over the past four years, council tax in Wales has increased well above inflation, and this year is no different. We welcome the transfer of responsibilities to local government, but funding is not always transferred in the same proportion. I was very unhappy with last year's use of the damping procedure, which hit rural areas in particular, including Monmouthshire and the Vale of Glamorgan, where council tax was pushed up further to provide money for some of the less prudent local authorities in Wales. The council tax bills of several councils are three or four times more than the current rate of inflation.I ask the Secretary of State and the Assembly to reconsider how they set priorities for local government. They are given money to pass on to local authorities, but the way in which they are caning rural areas in particular will not help.

The Budget is a small step back at a time when the Government have done so much damage in Wales. All the Budgets should be taken together and consigned to Room 101, along with Anne Robinson.

3.9 pm

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