Order for further consideration, as amended, read.
To be further considered on Monday 15 April at Seven o'clock.
Order for Second Reading read.
To be read a Second time on Wednesday 17 April.
1. Mr. John Smith (Vale of Glamorgan): What discussions he has had with ministerial colleagues in the Ministry of Defence about Royal Air ForceSt. Athan. 
Mr. Paul Murphy): I have regular discussions with my ministerial colleagues at the Ministry of Defence. I very much welcome the recent announcement by the Minister for the Armed Forces that the Welsh Guards are to be relocated to RAF St. Athan, in my hon. Friend's constituency, from May 2003. I am also pleased that the Ministry of Defence and the Welsh Development Agency will be working together on proposals to develop the site facilities, including the possibility of establishing an aerospace park at St. Athan.
Mr. Smith: I warmly thank my right hon. Friend for that reply. The development at RAF St. Athan, and especially the creation of a world-beating aerospace park, is indeed wonderful news. Will my right hon. Friend join me in welcoming the news this week that there will be no need, in that multi-million pound development, to extend the runway at RAF St. Athan, which I know is a great concern for the local community?
Now that the Defence Aviation Repair Agency forms the central part of that development, will my right hon. Friend, when he next meets his ministerial colleagues, point out that as DARA has become a trading company, it must be allowed to trade fairly not only with the private sector but with other arms of the Ministry of Defence?
Mr. Murphy: I am grateful to my hon. Friend for his comments. He will of course welcome the fact that the Welsh Guards are to come to RAF St. Athan, because it means that some 600 personnel will come to his constituency, which will obviously be a big boost to the local economy. In addition, the working relationship between the Government and the National Assembly, through the Welsh Development Agency, means that the development will be of enormous significance to the Vale of Glamorgan and surrounding areas. I pay tribute in particular to my hon. Friend for all the work that he has put into the project.
Mr. James Gray (North Wiltshire): We, too, welcome the fact that the Welsh Guards will be based at RAF
Mr. Murphy: I take the hon. Gentleman's point, and I am glad that he welcomes the Welsh Guards' return to Wales after nearly a century. I shall certainly take up his point with my colleagues in the Ministry of Defence and, of course, with the Assembly.
Chris Ruane (Vale of Clwyd): I welcome my right hon. Friend's efforts to preserve defence industry jobs at St. Athan. Is he aware that in the league table for defence spending in the UK, the north-east is top, with spending of over £700 per person, and Wales is bottom, with less than £120 per person? What efforts will he make to close that gap?
Mr. Murphy: I have visited my hon. Friend's constituency on a number of occasions. The aerospace developments in north-east Wales are particularly significant for his constituents and others, but I am sure that he and others will welcome today's news in the Western Mail that 267 regional selective assistance projects have been approved in Wales, which is a record number; that manufacturing production figures are up for the first time since the summer; and that business confidence in Wales is better than it has been for many years.
2. Mr. Bill Wiggin (Leominster): What plans he has to change the Barnett formula to ensure equality of spending per head on health between Wales and England. 
3. David Taylor (North-West Leicestershire): What recent discussions he has had with the First Secretary on the operation of the Barnett formula; and if he will make a statement. 
The Secretary of State for Wales (Mr. Paul Murphy): I meet the First Minister regularly to discuss a range of issues. The Government keep the operation of the Barnett formula under review, but have no plans to change it.
Mr. Wiggin: I am grateful to the Secretary of State for his answer but I wish that he had said a little more about health spending. He is probably not aware that the new Hereford hospital will have 120 fewer acute beds than the current one and that 10 per cent. of the hospital's patients come from Wales. The primary care trust needs a 4.1 per cent. increase in health spending, which is £6.5 million. Will the right hon. Gentleman make representations to Health Ministers and the Treasury to ensure that Hereford hospital has 120 more acute beds, which will benefit not only my constituents but the people of Wales?
Mr. Murphy: I suspect that not many hon. Members would see the significance of Hereford hospital, but the
David Taylor: The perverse nature of the Government grant distribution system within the United Kingdom must not be allowed to continue. The Secretary of State knows that even though Wales's population of 2.9 million is identical in aggregate to that of the east midlands counties of Leicestershire, Derbyshire and Nottinghamshire pre-1997, and the two regions have similar economic and social profiles, the level of public expenditure in Wales is significantly higher. Is not a full-scale economic and social assessment long overdue to form the basis for regional distribution, and should not the Barnett formula be thrown on the same bonfire as its English standard spending assessment cousin?
Mr. Murphy: No, I do not agree that the Barnett formula should be scrappedfar from it. My hon. Friend is aware that the Barnett formula was established 20-odd years ago and that it has served us well under both Labour and Conservative Governments. As far as I know, the Conservatives have no plans to change the Barnett formula, nor did they when they were in office for all those years, and it was of course a Labour Government who introduced the formula. It prevents constant haggling about finance every year, and it deals only with changes in spending levels. My hon. Friend is also aware that one of the reasonsthe chief reasonwhy Barnett was established was that deprivation in Scotland and especially in Wales was acute and needed to be tackled. The Barnett formula has done that very well.
Mr. Elfyn Llwyd (Meirionnydd Nant Conwy): The right hon. Gentleman is wrong. There is currently great deprivation in Waleslook at the fact that a good part of the country is covered by objective 1. Let me respectfully remind the right hon. Gentleman that Lord Barnett said that the Barnett formula was not a formula, and that it was meant to be temporary. It is time that we revisited it and introduced a proper needs-based formula, which is what is really needed in Wales and other parts of the UK.
Mr. Murphy: There is very little evidence to suggest that Wales would be better off as a consequence of such a change. Some time ago in the Assembly, the Minister for Finance, Local Government and Communities was asked precisely the same question. She replied:
Mr. Win Griffiths (Bridgend): I concur with my right hon. Friend the Secretary of State. May I suggest that, in fact, the complexity of changing from Barnett to some other formula would result in much wailing and gnashing
Mr. Murphy: The House should take note of my hon. Friend's words. As a former Welsh Office Minister before devolution, he is conscious of the fact that Wales benefited from the formula then, as it does now. I remind the House that because the formula ensures that changes per head are set at the same level in Wales as in England, the idea that the formula disadvantages England is simply wrong.
Lembit Öpik (Montgomeryshire): None the less, I am sure that the Secretary of State agrees that Wales could do with more money if it were available, and that the best way to achieve that is to elect a Liberal Democrat Government, who would raise direct taxation and put the money into public services. Until that great day, is the right hon. Gentleman at least willing to consider holding a cross-party debate on whether it is possible to produce a more level playing field for Wales, perhaps by reviewing the Barnett formula, accepting that if he can prove the points that he has already made, there is no need for change?
Mr. Murphy: I suspect that I will have long retired from politics before we reach that great day of a Liberal Democrat Government. While we are waiting, I point out to the hon. Gentleman that some days ago his party discussed its shadow Budget. The hon. Member for Truro and St. Austell (Matthew Taylor)I assume that this is agreed by Peter Black, who is the hon. Gentleman's Assembly spokesman on financeis happy to commit a future Lib-Dem Government to using the Barnett formula. I assume, then, that the hon. Gentleman would agree that the formula gives Wales more money.
Alan Howarth (Newport, East): Does my right hon. Friend agree that resources for health care should be allocated on the basis of need, and not, as the hon. Member for Leominster (Mr. Wiggin) suggests, on the basis of a crude head count?
Does my right hon. Friend also agree that there is a correlation between household income and health? Therefore, notwithstanding the impressive growth in prosperity in Wales since 1997, so long as average household incomes are lower in Wales than elsewhere, it will be appropriate that more should be spent on health care in Wales.
Mr. Murphy: My right hon. Friend is precisely right. He is aware, too, that it is for the Assembly to decide how much money is spent on the NHS in Wales, irrespective of what the Barnett formula gives Wales.
Average life expectancy in Wales is about a year less than in England, and the proportion of the working-age population with a limiting long-term illness is about50 per cent. greater than in England. These are fundamental problems that can be addressed only by proper resourcing, and that is precisely what a Labour Government and a Labour Assembly are doing.
Mr. Nigel Evans (Ribble Valley): Is it not a fact that through the Barnett formula more money per patient is
Mr. Murphy: The hon. Gentleman is entirely wrong in saying that the Barnett formula determines the amount of money spent per person on the health service in Wales. It does not do that.
Mr. Evans: More money is spent in Wales.
Mr. Murphy: Indeed, more money is spent on the NHS in Wales, but that is not because of the Barnett formula. The formula and the changes to it give Wales extra money. It is for the Assembly to decide how it distributes that money. It has given extra money to the health service in Wales precisely because of the points to which I alluded.
The issue is not only about money, but about reform of the health service. I note that the hon. Gentleman and his colleagues in the Conservative party voted against the reform proposals when they were before the House.
Mr. Evans: The Secretary of State agrees that more money is being spent per patient in Wales than in England, yet there are many shortages. The British Medical Association in Wales estimates that it needs a30 to 50 per cent. increase in the number of consultants to improve hospital services. Vacancy rates in cancer are 24 per cent. In mental health, the rate is 17 per cent. and in radiology it is 13 per cent. We have eight consultant neurologists, but the British Association of Neurologists says that we need 28.
After five years of a Labour Government, the Government are scouring Germany for doctors and Spain for nurses, while British patients are being sent to France for operations. Children in Wales wait up to nine years for non-emergency plastic surgerythe worst waiting time in the developed world. Is it not time to cut the spin, to stop the sloganising and to deliver a first-rate NHS, which is what the Government promised in the first place?
Mr. Murphy: Why does the hon. Gentleman not understand that more money is spent on the health service in Wales because of the neglect of the health service for nearly two decades? That is the reason behind it. The hon. Gentleman should understand also that over the past12 months, waiting for cardiac surgery fell by 38.6 per cent. Waiting for orthopaedic surgery fell by 10.6 per cent. and the number of patients waiting for cataract surgery fell by 25 per cent.all during the winter months. In addition, the hon. Gentleman is wrong about personnel. We now have 400 more doctors, and 500 extra nurses are being trained in Wales this year. By 2004, there will be
Llew Smith (Blaenau Gwent): The Secretary of State will be aware that, in Blaenau Gwent, we have some of the worst health problems in the United Kingdom. I am sure that he will also accept that if we are to tackle bad health, we must tackle poverty. With that in mind, will he have a quiet word with the First Secretary about the money that he is wasting on a millennium arts centre and on the new Noddy-like transport system whose sole object seems to be to get Assembly Members from the Assembly to the council chambers without getting wet? Will he suggest that those schemes be dropped and the money reinvested in tackling health and poverty in areas such as Blaenau Gwent?
Mr. Murphy: I shall certainly have a quiet word with the First Minister, although how quiet it will be on such issues is anybody's guess. With regard to my hon. Friend's constituency, as a valley Member of Parliament myself, I am aware of the health spending inequalities over the years between different parts of Wales. That is why the Assembly has rightly listened to the findings set out in Professor Townsend's report, which I hope will end that inequality.