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Aerospace Industry

3. Mr. Ben Chapman (Wirral, South): When he last had discussions with the First Secretary of the National Assembly for Wales on the aerospace industry in north Wales. [53146]

The Parliamentary Under-Secretary of State for Wales (Mr. Don Touhig): My right hon. Friend the Secretary of State and I regularly meet the First Minister to discuss a wide range of issues, including the aerospace industry in Wales.

As I said in reply to a similar question from my hon. Friend on 10 April, I recognise that prospects for the aerospace industry in north Wales and my hon. Friend's constituency are underpinned by the continued success of Airbus at Broughton. I continue to believe that the good working relationship between the management and trade unions at Broughton are vital to the success of that project.

Mr. Chapman: My hon. Friend will appreciate that Airbus at Broughton, where many of my constituents work, along with other parts of the aerospace industry, could have faced problematic times post-11 September. Can he assure me that he is doing all that he can to provide continuing long-term support to the site and to the industry, and that he will bring pressure to bear on the Ministry of Defence to advance the orders for the A340 air tanker to bring further work to the site?

Mr. Touhig: I know well my hon. Friend's commitment to the success of Broughton, and I am sure that he will welcome the good news of orders for the A340 from South African Airways and from Virgin. I take note of his point about the Ministry of Defence and the A340 air tanker, and I shall bring that to the attention of my right hon. Friend the Secretary of State for Defence.

Lembit Öpik (Montgomeryshire): Is the Minister aware of the creation on 26 March this year of Aerospace Wales, which represents the £2 billion a year turnover and 20,000 jobs that the aerospace industry in Wales provides? Would he be willing to meet a cross-party delegation of MPs, Assembly Members and interested parties to talk about developing a coherent strategy and creating a brand for Aerospace Wales, and to discuss a coherent strategy for airports in Wales, which are badly in need of development?

Mr. Touhig: As a Welsh Member of Parliament, I am conscious of the important impact of the aerospace industry throughout Wales. Indeed, it is a very big employer in my constituency and in adjoining constituencies. I would be happy to meet him and the group that he mentions, because it is important that we are all seen to be pulling together to ensure, after 11 September, that the aerospace industry is a success

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story. We have a great story to tell in Wales and a good work force. Investment is going in, and let us all pull together to make sure that the industry succeeds.

Mr. John Smith (Vale of Glamorgan): I, too, welcome the recent launch of Aerospace Wales in my constituency, which combines the manufacturing base in the north with the repair and servicing cluster of industries in the south. Does my hon. Friend agree that this is the time to invest in aerospace training skills in colleges such as Barry college in my constituency, not to cut back on capacity?

Mr. Touhig: I know of my hon. Friend's support for the aerospace industry, and I agree with the point that he makes. I recently met in London a deputation of trade unionists from my area. They are passionately in favour of their company investing in reskilling and upskilling the work force so that it can meet the growing technological demands that the industry will face. I shall certainly do all that I can, working with colleagues in the Assembly and with Ministers to ensure that that is a success, and I am sure that my hon. Friend's college in Barry will make a contribution to that.

Mr. Nicholas Winterton (Macclesfield): Does the Minister accept that the aerospace industry is not only United Kingdom-wide, but an international business? BAE Systems, the main player in the aerospace industry in the UK, is internationally based.

Although I agree with the hon. Member for Wirral, South (Mr. Chapman) that in the present difficult climate the Ministry of Defence should, where possible, develop projects to guarantee a skilled work force, does the Minister accept that there is a duty and responsibility on Government to minimise additional business costs?

Mr. Touhig: On the hon. Gentleman's last point, the Government stand on their record, which is unparalleled.

I agree that it is important for all arms of Government, especially the Ministry of Defence, to play a part. I have no doubt that it will do so. Certainly, in Wales the MOD has played an important role in the development of the aerospace industry, especially as regards recent announcements about RAF St. Athan. This is an issue that can unite all hon. Members, and we are all working together to the same end.


4. Mr. Wayne David (Caerphilly): What discussions he has had with the Treasury as to the likely impact of measures recently announced in the Budget to improve the performance of the Welsh economy. [53147]

The Secretary of State for Wales (Mr. Paul Murphy): I have regular discussions with my right hon. Friend the Chancellor on a range of issues, including, of course, the Welsh economy. The Budget included a number of measures that will give a boost to the Welsh economy, including a 0 per cent. corporation tax starting rate, a 1 per cent. corporation tax cut for all small firms, research and development tax breaks for larger firms, further simplification of VAT for small firms and other

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modernising tax reforms. I am also pleased to note that Wales is posting the fastest fall in unemployment of any region or country in the United Kingdom.

Mr. David: I thank my right hon. Friend for his reply. There can be no doubt that the Budget has been a powerful stimulus to the development of the Welsh economy. Unemployment in Wales is indeed at an all-time low, but there are still areas of high unemployment, especially at the heads of the valleys in south Wales. Will my right hon. Friend give an indication and a commitment that the Government will continue to tackle those high rates of unemployment?

Mr. Murphy: Of course I shall give that commitment. I represent a valley constituency myself and understand what my hon. Friend is saying. He is aware that the Assembly, as well as the Government, is doing its best to regenerate our south Wales valleys. In his constituency, for example, there have been 18 new inward investment projects, creating more than 1,000 jobs and safeguarding more than 100 jobs. The unemployment rate in his constituency has dropped, which is part of the general picture in Wales and means that unemployment in Wales is the lowest that it has been for 27 years—[Interruption.]

Mr. Speaker: Order. I appeal again to the House to come to order. It is far too noisy.

Mr. Mark Prisk (Hertford and Stortford): Last Thursday, the Secretary of State told the House that inward investment was vital to the performance of the economy in Wales. Would he, therefore, care to comment on the fact that, as a proportion of the UK total, inward investment in Wales has collapsed from 19 per cent. in 1991 to only 11 per cent. last year? What has gone wrong?

Mr. Murphy: I remember that the hon. Gentleman took part in the debate on Welsh matters last Thursday. He rightly pointed out the importance of indigenous firms and how they can help to regenerate the Welsh economy. However, I also point out to him that, this very year, the Assembly has the highest level of regional selective assistance grants for seven years; £130 million of RSA has gone into various companies; and 267 investment projects in Wales have benefited from that. There is a combination of two things: we need inward investment and we need to help indigenous industry. That is why, as I said earlier, more people are in work in Wales than at this time last year, despite the loss of manufacturing jobs.

Llew Smith (Blaenau Gwent): The Secretary of State will be aware that in Blaenau Gwent we have some of the greatest poverty in Wales, with some of the highest unemployment and the lowest wages. He will also be aware that, in the next few weeks, Corus will finally close. When he meets the First Secretary will he ensure that the public moneys that he has just mentioned, and which are so generous this year, are directed to those areas in Wales where poverty is greatest, and are not lost, as is often the case, in Cardiff in general and Cardiff bay in particular?

Mr. Murphy: I am very much aware of my hon. Friend's views on these matters. I believe that we can do both in Wales: we can see that the regeneration of our capital city goes ahead, while ensuring that we put proper

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resources into Blaenau Gwent and the other south Wales valleys. Only a Labour Government, working with a Labour Assembly, can do that.

Student Debt

5. Mr. Hugo Swire (East Devon): If he will make a statement on student debt in Wales. [53148]

The Parliamentary Under-Secretary of State for Wales (Mr. Don Touhig): My right hon. Friend the Secretary of State and I meet regularly with colleagues to discuss a range of issues, including student finance.

Mr. Swire: Student debt has doubled since Labour came to power in Wales. Since the establishment of the Welsh Assembly, and with the support of the Liberal Democrats, the situation has deteriorated further. Is that appalling record the fault of the Welsh Assembly or is it something for which the Government are prepared to take the blame?

Mr. Touhig: The hon. Gentleman must have forgotten that when his party was in power there was a considerable problem of student debt. We have reformed the whole system of student loans, making it much easier for students to access funds, and we have related the repayment to their earnings. The Government, working in partnership with the National Assembly, are aiming at their target, which is to increase the number of people entering higher education. The Government whom the hon. Gentleman supported never succeeded in doing that; we are going to achieve it. We will achieve it quite soon.

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