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Mr. Grieve : I am intrigued to hear the hon. Gentleman refer to the Barnett squeeze. As he and I are aware, the Barnett formula delivers substantially more
 
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expenditure per head of population in Wales than it does in England. Admittedly, it is on a falling graph, moving towards a position of eventual parity in about another 20 years. Is the hon. Gentleman suggesting that, in the meantime, Wales is disadvantaged in respect of per capita expenditure?

Adam Price: The hon. Gentleman is right that it is an equalisation formula, so year on year the gap that he describes gets less. That is the Barnett squeeze. If we look, for example, at per capita health spending, most people would accept—it is borne out by the figures on chronic sickness—that Wales has one of the worst health profiles in the UK. Of the 12 standard UK regions, we are now fifth in respect of per capita health spending. We were third only four or five years ago and have been overtaken by the north-east of England. London has far higher per capita health spending than Wales but, as I say, we have been overtaken by the north-east and we will be overtaken next year by the north-west of England. There is currently only £5 per head difference.

The Barnett squeeze is having a real effect in Wales. It is impacting on the Welsh Assembly's ability to reduce waiting times. The public service agreements for health refer to a period of 18 weeks, but 18 months is the standard in Wales, and the waiting gap has increased. The only way to correct matters is to reform the Barnett formula. The spending review refers to Professor MacLean of Nuffield college, who is one of the strongest advocates of scrapping the Barnett formula, on the ground that it does not deliver territorial justice across the UK's regions and countries.

I end by noting that the First Minister of the Welsh Assembly this afternoon announced that there will be a bonfire of the quangos. It will be dramatic: the Welsh Development Agency, the Wales Tourist Board and the Welsh Language Board will all be abolished. I hope that that is not how he intends to meet the job reduction targets, but I urge the Government to add the Barnett formula to the bonfire. We will never achieve territorial justice for Wales, for the south-west or north-east of England, or for any part of the UK while that formula stays in place.

6.11 pm

Mr. Tom Clarke (Coatbridge and Chryston) (Lab): I have listened to almost all the debate, but I apologise to the hon. Member for Twickenham (Dr. Cable) and to my right hon. Friend the Member for Newport, East (Alan Howarth), as I had to leave the Chamber to chair an all-party group on disability with Lord Rix.

The debate has been very interesting.The right hon. and learned Member for Rushcliffe (Mr. Clarke) has left the Chamber, having been here for most of the afternoon, but his remarks were of particular interest. Like other Opposition Members, he found himself in some difficulty. I recall how, when in government, he was defeated when he sought to persuade the House to increase the value-added tax on pensioners' fuel to 17.5 per cent. He predicted that the most dreadful things would happen if we did not approve his proposal. He also made dire predictions about what would happen if we introduced the minimum wage.
 
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The right hon. and learned Gentleman, in opposition, has repeated those terrible predictions over the past seven years. I am sure that he will forgive me if I say that they have become even less convincing, given his record in terms of astrology, if not of economics.

The Opposition have had to deal with the problem that the statement by the Chancellor was an indication that he has succeeded in reforming the economy. For example, the low level of inflation must fill the former Chancellor with envy. The consistently low level of interest rates has helped those of my constituents who aspire to home ownerships. Interest repayments on debt are much lower, and growth is high. All those factors have contributed to the economy's strength and stability.

I shall concentrate on what is happening in my constituency of Coatbridge and Chryston, especially in respect of employment and the new deal. The transformation that has taken place in my area would not have been possible without the economic policies that the Chancellor has pursued.

Before 1997, debates such as today's were dominated by the problem of unemployment. How could it be otherwise? My constituents accounted for more than their fair share of this country's total of 3 million unemployed—even at a time when we enjoyed the benefits of North sea oil revenues. Whatever disagreements might have emerged in the debate, I am delighted to say that today we are focusing on employment. We are rightly talking about job potential in terms of the new deal. We are thinking of a new agenda, as well as of what has been achieved. We are thinking of how the new deal can be improved to offer better quality jobs to those who benefit from it. I invite the House to focus on how we can build further on the excellent achievements of the new deal. Discussions on the new deal can appear somewhat abstract, but nearly 90,000 young people are participating in it as we speak. In Scotland, some 129,200 starts have taken place, 10,200 of which were for young people. In my own constituency up to March 2004, the new deal appealed to 2,031 people.

Those statistics—we must not forget that they deal with real people and families—show that we are well on our way to full employment. The Beveridge ideal is an idea whose time has come. That fall in unemployment offers the foundation for this year's spending review: by freeing up resources that would otherwise have been spent in propping up unemployment, we are able to invest in those essential services—health, education and transport—that are so important to my constituents and throughout Britain.

It is important to build on the success of the new deal so that the tremendous progress we have achieved can be enhanced still more. My constituents want to see that happen, and I hope that Department for Work and Pensions will ensure that the additional resources that the Chancellor made available in his announcement on Monday will allow it to focus on how it can improve still more on its approach to the new deal.

There are three key elements to that improvement. The first is ambition. We should all do more to encourage people's ambition to achieve better paid, more secure jobs. We should invest in skills and training so that people have the opportunity to obtain
 
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qualifications and move on to better jobs. I extend my plea for ambition to employers, who should be encouraged to become involved in the design of the new deal programmes. Rightly, employers have had plenty to say through their various organisations, including the CBI, but they should play an important part in providing the demand for highly skilled jobs. Our people will respond to that.

The second element is leadership. We need to see more evidence of leadership in providing higher quality jobs through the new deal and other schemes. We need leadership to involve more people from disadvantaged groups, people with disabilities and those from ethnic minorities. Business and commerce today are capable of providing that leadership, especially in my constituency.

The third element is capacity. The biggest employers in my constituency are the health service and North Lanarkshire council, which offers an excellent example by making skilled jobs available.

There is an even greater challenge: to recognise that the resources made available matter as much to the users of services as to employers, and indeed to the House itself. As a former civil servant, I am sure that when the Chancellor said that there would be full consultation, he meant it. I look forward to that nationally and locally.

Some weeks ago, I introduced an Adjournment debate on laryngectomy and talked about people who suffered from throat cancer and had to use voice boxes for the rest of their life. I referred to the work of the charity, Macmillan Cancer Relief, which had established that £20 million in benefits were not being taken up by cancer sufferers. The Lanarkshire Laryngectomy Association informed me that benefits of £2 million were not being claimed in the area, although people with cancer should have been receiving them.

In light of Gershon, the Chancellor's announcement about shifting resources to the front line is extremely important. Benefits forms are comprehensive so people such as those cancer sufferers should have the opportunity of one-to-one interviews, with as much assistance and advice as possible. I know that the Government want to achieve that and that the House will endorse that view.

In that spirit, I welcome the Chancellor's statement. It provides opportunities for my constituents and for people throughout the country. More than that, however—because employment leads to growth—it means that we are recognising, at long last, our international responsibilities. The Chancellor's record on that is unprecedented.

6.22 pm

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