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Session 2003 - 04
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Welsh Grand Committee Debates

The Government's Legislative Programme and Public Expenditure in Wales

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Welsh Grand Committee

Tuesday 16 December 2003



[Mr. Win Griffiths in the Chair]

The Government's Legislative Programme and Public Expenditure in Wales

8.55 am

The Chairman: It might help if I remind Members of the timing of our debate. We have from now until 11.25 am, we will meet again at 2 pm, and we shall debate the motion until 4 pm.

The Secretary of State for Wales (Mr. Peter Hain): I beg to move,

    That the Committee has considered the matter of the Government's Legislative Programme as outlined in the Queen's Speech as it relates to Wales and Public Expenditure in Wales.

The Queen's Speech and the pre-Budget report show the Government charting the way forward for a better Wales, and building on Wales's world-beating success over a wide range of economic indicators.

The measures that we have announced in the past few weeks are firmly based on a platform of economic stability, the like of which Wales has not seen for many years. Employment is 61,000 up on last year; 6,000 new businesses have been started during the past year; Wales's unemployment rate is below the national average; in November, Welsh business activity expanded for the eighth successive month; and average earnings were up 4.7 per cent. in 2002, a bigger increase than for the whole of the United Kingdom.

Wales has seen the biggest fall in economic inactivity rate of any economic region in the UK; it has fallen 2.6 per cent. since September last year, which is especially important in valley communities where there have been high rates of hidden unemployment. Wales has seen the biggest increase in employment rates in any economic region of Britain, up 2.9 per cent. since September last year. That is higher than all European Union countries except Denmark, Sweden and the Netherlands, and better than Japan, Canada and the United States of America.

Who could have imagined that in the grim 1980s and 1990s? Well, one person could—the new leader of the Conservative party. He maintains that coalfield communities

    ''revived very considerably under Margaret Thatcher.''

He says that

    ''It was not Margaret Thatcher's fault that the industries that were there when she came to office were declining industries. What she did was to put in place arrangements which enabled those communities to survive.''

Communities such as those that I and many of my hon. Friends represent, including that represented by the Under-Secretary of State for Wales, my hon. Friend the Member for Islwyn (Mr. Touhig), know that the 1980s and much of the 1990s were the grimmest years

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ever faced by the Welsh coalfield communities, yet the leader of the Conservative party has either the cheek or the ignorance to say that they started doing better under Mrs. Thatcher's dreadful policies.

It is the same old Tories, same old Tory myths. The people of Wales will never forget that when the new Conservative leader was Secretary of State for Employment, unemployment went up by more than 1 million in Britain, and it increased savagely in Wales. Have not my comments clearly demonstrated that although they may elect new leaders, the Conservatives still hold true to the same disastrous policies that took us into the two worst recessions that we have endured since the second world war?

In contrast, after six years of a Labour Government, the UK has the lowest public debt of almost anywhere in the world, the lowest interest rates since 1955, the lowest inflation since the 1960s, and the lowest unemployment for 25 years. Of all the major economies, the British economy has been the fastest growing, despite the worst global slow-down for nearly 30 years.

Mr. Elfyn Llwyd (Meirionnydd Nant Conwy) (PC): The right hon. Gentleman might have seen the recent report from the Office for National Statistics. Its forecast for Wales is that the gross value added per capita is set to fall to 74.9 per cent. by 2010 against a Government target of 90 per cent. Could he tell me—the Chancellor could not—what in the Queen's Speech will assist in closing that gap?

Mr. Hain: For a start, the research and development tax credits, small business support and the other measures that I am about to describe. First, however, we should look at the GDP rates, something that Plaid Cymru has been bantering on about for a while.

Through the 1980s and 1990s, we have seen in Wales a decline in GDP per head relative to the UK average. That has been a consistent theme. However, having declined steadily relative to the UK average between 1995 and 1999, Welsh GDP per head has for the last three years remained stable at about 79 per cent. Since the National Assembly was established, the relative decline in Welsh GDP per head has been arrested. Excluding the south-east and east of England, Wales has done better than most other regions. Indeed, according to figures released in August, Welsh GDP has increased by 15.6 per cent. between 1997 and 2001.

We are still behind where we ought to be, but relative to the rest of the United Kingdom—excluding the south-east, which has become extraordinarily overheated—Wales has been doing better. We are doing better even than Scotland. It is interesting that Plaid Cymru, in consistently advocating independence, which is the party's policy, should point to the Scottish model as a cure-all for Wales's historic economic problems, as Wales has done rather better than Scotland under the Labour Government in precisely the measure that the hon. Gentleman mentioned.

It is against that background that the Queen's Speech set out legislation to create safe and secure communities, to provide life-long opportunities and

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social justice, continued economic stability and better day-to-day quality of life—all underpinned by a modern democracy.

Lembit Öpik (Montgomeryshire) (LD): Accepting that the Government have had some successes in their management of the economy, would the Secretary of State nevertheless accept that many rural areas have been hard hit—for example, by the foot and mouth crisis not so long ago? To that extent, those communities may benefit if we can improve the amount of money that they receive from Europe.

Mr. Hain: I accept that foot and mouth had a dreadful effect in large parts of Wales, and especially for the rural communities in the hon. Gentleman's constituency. That has been addressed by the Government, although problems still remain. However, he will also appreciate that unemployment in his constituency has come down significantly since we came to power in 1997. The main economic indicators are on the up for rural areas in his beautiful constituency—I was privileged enough to visit it in August to see the National Eisteddfod—as well as for the rest of Wales.

First, we intend to create a safer, more secure environment for our children, with greater protection to be given them under the children's Bill. The Government are working closely with Assembly Ministers to agree the read-across to Wales. There will also be a Children's Commissioner for England: where Wales leads, England follows. We are also working to devolve responsibility in Wales for the Children and Family Court Advisory and Support Service to the Assembly, to ensure a coherent children's policy under one Minister just as happens in England. That will end the anomaly of the Assembly having power over all children's welfare issues except liaison with the family court. For the first time, Wales will have comprehensive child protection and children's rights policies.

Julie Morgan (Cardiff, North) (Lab): Does my right hon. Friend agree that the devolution of CAFCASS to Wales will be a good opportunity to create a first-class service for the children of Wales? Would he agree also that one way to achieve it would be for children's voices to be heard by the service, just as Funky Dragon advises the Assembly? A group of young people could advise CAFCASS and help it to move away from its sad history in the UK.

Mr. Hain: That is an exciting policy suggestion—to empower children and to give them a voice in the new policy development. I pay tribute to the work that my hon. Friend has done to promote children's rights in Wales. I strongly agree—this is why we are taking the idea forward—that devolving full responsibility for child protection and children's rights across the board will give the children of Wales the national voice that they have always needed and will start to end the problems of child abuse and the infringement of children's rights, which we have seen all too often in the past and which sadly still continue.

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Hywel Williams (Caernarfon) (PC): Can the right hon. Gentleman assure the Committee that CAFCASS, in its new form, will be able to provide a Welsh-medium service to children in Wales? The lack of that service was one of the principal complaints of CAFCASS management in Wales at the highest level.

Mr. Hain: The hon. Gentleman raises an important point. I am sure that the Assembly will want to take that forward and acknowledge the point. Clearly that is an important part of providing a comprehensive children's rights service.

The Fire and Rescue Services Bill will improve the safety and security of our communities and devolve responsibilities for the service to Wales. To increase security and safety for our citizens we will publish an identity cards Bill in draft. However, it will be a matter for the Assembly to decide whether possession of an ID card will be necessary to access public services in Wales.

Lembit Öpik: I have always regarded the ID card proposals—which I obviously oppose—as a Home Office issue. If that power is to be devolved, does that imply that other Home Office related legislation could be devolved to the Welsh Assembly, in theory at least?

Mr. Hain: No, not at all. The Assembly is left to decide whether access to the services for which it is responsible—health services, education services and so on—will be determined by the possession or otherwise of an ID card.

The hon. Gentleman says that he opposes ID cards. The truth is that almost all of us carry an ID card anyway. The way that biometrics are going, we will increasingly find—whether on passports or driving licences—that one will need to have a biometric to have a valid document. I am advised that, within a year or so, one will require a biometric on one's visa in order to get into the United States. It is an inevitable modern development, it seems to me, whether wise or not. I do not think that even the Liberal Democrats in Wales can hold up the process of globalisation.


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Prepared 16 December 2003