The Budget Statement and its Implications for Wales

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Huw Irranca-Davies (Ogmore) (Lab): It is always a great pleasure to follow the hon. Member for Leominster (Mr. Wiggin), who is settling into his role well. It strikes me occasionally that he seems to live in a different country from me—but then I realise that he does. In responding to the Chancellor's speech the other day, the Opposition Front-Bench spokesman, the right hon. Member for West Dorset (Mr. Letwin), said that he was a clickety-click Chancellor, ratcheting up taxes day by day and month by month. I do not agree, but far better a clickety-click Chancellor than a snippety-snip Chancellor, who would make it death by a thousand cuts for our jobs and public services.

I should like to narrow the focus on the Budget and the policies that the Labour team have introduced, and refer to my constituency and, in particular, the Garw valley. This is a clarion call to try to ensure that all agencies, all levels of Government and all of team Labour are working together, so that what is delivered at Westminster in the Budget is also delivered in the Garw valley. For those who do not know, the valley has strong connections with Paul Robeson and the film ''The Proud Valley''. More recently, we have had the film ''Very Annie Mary''. There is a proud tradition of film making in the area and, with regard to the earlier discussion, I just add that I hope our film studios are up and running soon.

Hywel Williams (Caernarfon) (PC): On that point, I am sure that the hon. Gentleman would like to congratulate Rhondda Cynon Taff council on the hard work that it undertook to secure the film studios. The studios will be in his constituency, but the county boundary is somewhat different.

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Huw Irranca-Davies: I will join in the congratulations to Rhondda Cynon Taff council if the hon. Gentleman will join me in congratulating the Assembly on finding the innovative way forward that the project hangs on, which involves ensuring that junction 34A on the motorway goes ahead. Sue Essex of the National Assembly had a tremendously difficult decision to take, and she faced a great deal of lobbying, not least by Labour MPs from the area and Assembly Members, and she took the right decision. I look forward to the project going ahead.

The Garw valley is familiar to some hon. Members. I am conscious of the time, but it will help if I paint a quick picture of some of the problems that it has faced. It is as typical a coal-mining valley as can be. There were six deep pits between the 1870s and 1985, when the last one closed. It is a narrow valley, six miles long, with a strip settlement along it and a cul-de-sac at the end. At the top of the valley, as one heads up to the highest point of the mountains, is a place known as ''heaven's acre''. The dozen or so houses there are the nearest to God, apparently.

The peak of prosperity for the area came in the 1920s. It went into decline after that, but the heaviest decline involved the loss of the traditional extractive industries, particularly through the 1980s, and the fact that nothing was put in their place to save the communities that were left. I shall not rehearse that point unless the hon. Member for Leominster wants to challenge me. I shall be most happy to let him intervene if he wants to; if not, I shall continue.

There is quite an interesting analogy to do with Ogmore. There have been discussions today on north, south, west and mid-Wales, but in Ogmore there is a classic north-south divide. There is a high degree of prosperity along the M4 belt, yet only six miles away, at the top of the Garw valley, are some of the most deprived wards in Wales. That is within easy travelling distance of the motorway—20 minutes in the car, if that. Many people who live alongside the M4 commute up to Cardiff, yet so many economically inactive people at the top end of the Garw valley—in Pontycymmer, Blaengarw and so on—have been left behind. That is where the Government's policies are making the difference.

The way ahead for the Garw valley is a combination of policies that are implemented at a local level by the Assembly and Westminster. Locally, the optimism is tremendous and there have been some good initiatives. For example, a report showed that, in 2002, in the Bridgend county borough area, £172 million was spent on tourism, nearly 3,500 people were employed in tourism and more than 3 million visited. However, most of those visitors head to the south of the constituency or to the coastal strip; they are not being brought up into the Garw valley. That is a classic example of a historical oversight, and yet since 1988 the Garw valley has been subject to £60 million of reclamation works. It is now the most beautiful natural landscape; more beautiful, perhaps, than when it was gifted to us by the Almighty above. It has been reconstructed in such a way that it is ideal for adventure and equestrian activities and so on.

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Some of the projects being developed locally give me a great deal of optimism. The Bridgend Valleys Railway, formed in 1988, is now seeking substantial funding to open a strip of two and a half miles of old steam railway from Llangeinor to Pontycymmer. The railway has its work cut out for it, but the hundreds of volunteers involved are working hard to see the project come to fruition. In addition, the Mynydd Carn adventure centre—I declare my interest as a patron of the centre—has the idea of a high-ropes multi-sport activity centre, with accommodation, at the top end of the Garw valley. Bunk-barn accommodation entrepreneurs have started to express an interest. The Dr. Richard Price interpretation centre has a role as a tourism gateway into the valley. There are the Woodlands, the equestrian centre and a programme of events. All those projects are a turning point for the Garw valley. They are all great ideas, they are all seeking funding and they all have behind them a lot of good will and local authority and voluntary sector impetus. As yet, however, none of them figures on the ground.

On top of that, local government is coming forward with necessary initiatives. Bridgend county borough council has been extremely innovative, working on construction industry training pilot schemes, business support and capacity building. In our communities, it is not simply a case of throwing money at the issue or of looking for inventive tax allowance schemes to encourage small businesses; it is about building capacity and giving people the confidence to stand on their own two feet. For too many years they were encouraged to sit back, do nothing and sign on. That mindset has changed dramatically, not least because of the new deal initiatives that have been implemented.

In the Garw valley and elsewhere, Bridgend council is also working on enterprise awareness and skills development. However, it is important that, at a Welsh and a UK level, we provide economic stability to encourage people to go into work and to set up for themselves. Certain areas of mid and west Wales have many small and micro-businesses and many self-employed businesses. However, we do not have that great tradition in many parts of our valleys and that is what we need to work towards. To do that, we need the economic stability that the Chancellor has provided at a macro level.

When I hear aspersions cast on the quality of the judgment and chancellorship of our right hon. Friend in the Treasury, it makes me wonder. The Labour party has stolen the clothes of the Conservatives. It was always the Conservatives who were supposed to be good at running the economy, and Labour would come in, have a great splurge of public investment and then nose-dive out within a couple of years. Wrong, wrong, wrong—we now have a Chancellor who has gone from year to year with his predictions and growth figures being proved right. That means that in the UK and Wales we are on target to build strong, sustainable economic stability. We should not underestimate the importance to new businesses and entrepreneurs of the stability of low inflation, low interest rates and the rising prosperity of consumers. That is a gift given by the Labour Government and the Chancellor.

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Employment has risen significantly in my constituency. I visited the Library on the way here, so I hope that hon. Members will trust the figures. In 1997, unemployment was 1,767; a year ago it was 1,177 and it is now 1,107. Year on year, that is a massive reduction in unemployment. It fell by 6 per cent. last year, and since 1997 when Labour took office it has fallen by nearly 40 per cent. We must ask what was happening before then. Unemployment is down not only in Ogmore, but in many other constituencies. I will happily lend the document to Opposition Members if they want to see the figures.

The Budget benefits entrepreneurs and people who are employed, and it contains measures aimed at employability in enterprise areas. I particularly welcome the business premises renovation allowance, which is aimed at the most deprived communities. It will have a massive effect in the Garw valley, where one of the biggest complaints is about the inability of business to renovate boarded-up shop frontages that give the wrong impression of a community when tourism or other economic development is being considered.

We should not underestimate the Welsh block boost of £300 million for the next few years, which is linked to the announcement for England about skills and education. There are also increases in the national minimum wage, which will particularly benefit people in the remoter parts of the Garw valley. As 65 per cent. of businesses in the valley are locally owned and 90 per cent. of them employ people who live within walking distance, literally a stone's throw away, many people there will benefit from the increases and from the extension of the minimum wage to 16 and 17-year-olds.

I recently attended an awards day for the new deal in Pontypridd, as did my hon. Friend the Under-Secretary. I know from the comments made this morning that that Plaid Cymru Members warmly welcome the new deal. In Bridgend and Rhondda Cynon Taff we have one of the best, if not the best, independently assessed new deal schemes in the country. It has led the way in initiatives on incapacity benefit and for the under-25s, the over-25s and the over-50s. Some of the stories related at the ceremony showed that, in tackling poverty, there is a dividing line between those who support the new deal and those who would do away with it.

The woman who won an award in the over-25 category had a history of heroin misuse, which started when she was a teenager. She had young children and had never worked before, but she had managed to secure a job and hold it down for nine months, with the help of resource-intensive support from the one-stop shop approach. People advised her and stayed in contact with her while she was trying to find her feet; they were also in contact with the employer to encourage them to stick with her. She was a shining example of how the measure works, and she was not the only one, as more than 600 people have benefited in my constituency alone. That is the difference

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between what Labour is doing in the Budget and what went on before 1997.

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