---

Andrew George: Perhaps the hon. Gentleman is more easily satisfied than me. He says that the money will be there, but we are told that it will be there in the regions generally, not in objective 1 regions. It will be available in an area that is 10 times the size, and it will be siphoned off into other activities. If he has had an agreement for the delivery programme on Merseyside, good for him, but we have certainly not had such an agreement for Cornwall and the Isles of Scilly. That is what we are looking for: a clear contract, a budget, clear geographical coverage of a genuine region, not a Government zone, and a commitment for seven years plus two. We do not have that.

Mr. Kilfoyle: Surely, the hon. Gentleman understands that government is an organic process and that, as things improve, we expect it to adapt to changing circumstances. The figures and statistics for Cornwall have long been depressed, as have those for Merseyside and other areas, but one hopes that the success of the programme will be measured by those areas' ability to come out of it. I do not want Merseyside to qualify for objective 1 criteria for ever and a day. I want it to move over the 75 per cent. threshold, so that we can stand alone and fight our own battles in the wider world. Surely to God, he cannot look for some kind of guaranteed commitment to provide a specific kind of funding for ever and a day. The arrangement is bound to change according to circumstances.

Andrew George: I am asking for a commitment not for ever and a day but for seven years. In the light of Cornwall's 65.3 per cent. GDP figure, it is highly unlikely even with the best possible prospects that it will jump over the threshold—as I hope Merseyside will, as well as Cornwall. We must be realistic: Cornwall will not burst its way through the 75 per cent. threshold tomorrow, and it is not likely to do so before 2006. We know that it is bound to be eligible for objective 1 status beyond 2006. The point that I am making is that we want a commitment for seven years plus two, not for ever and a day. Hon. Members do not appear to be able to hear what I am saying.
 
12 Jan 2005 : Column 384
 

Mr. Watts: While many of us can claim credit for campaigning for objective 1 funding over many years, the decisions are made by the Council of Ministers. It will be British Ministers—Labour Ministers—who will negotiate on our behalf in the Council of Ministers. Obviously, the sort of guarantees that the hon. Gentleman is seeking cannot be given until those discussions have taken place and there is general agreement about whether there will be a nationalised policy or a European programme, and about the size of the initiative, the amount of resources, and how long it will last. He should take some comfort from the Government's regular statements that Cornwall's status will be maintained either Europewide or in the UK and that resources will come into Cornwall to compensate it if it has a UK-based scheme rather than a European one.

Andrew George: I cannot say that I take comfort from what the hon. Gentleman says. It is encouraging, but I am not reassured. We are playing with words, and we are in a grey area with regard to how satisfied we are with the settlement.

Even if the Government wish to promote the argument of achieving a 1 per cent. level for the EU budget, I do not understand the logic that says that the UK is therefore arguing that only accession states that are eligible for objective 1 funds should be in receipt of them. If we are entitled to objective 1 funds, as Cornwall will be—they could be, say, £300 million over seven years—why not have that money, which will help to supplement the UK's own contributions to its own regional economic development? I cannot see the logic of completely cutting ourselves off from access to European regional structural funds, and I hope that the Minister will take that point on board.

I have spoken for a reasonable length of time, but a certain amount of time remains. The Government have made some encouraging statements, but future statements must include nailed-down commitments on areas that are currently eligible for objective 1 status.

I hope that the Minister understands that the matter is one of genuine concern and not simply the result of politicians' campaigning. Apolitical and non-political people in Cornwall and the Isles of Scilly are genuinely concerned: they have engaged with the programme by examining the third cohesion report and statements made by Ministers, and they say, "We want to keep objective 1 status, thank you very much." I hope that the Minister will take that point on board and consider whether she can strengthen some of the Government's commitments, and in particular those on geographical coverage, length of commitment and available budget.

It is vital that we have a programme that includes a contract with those areas. Cornwall and the Isles of Scilly is a region that genuinely works and that people recognise, unlike the Government's south-west zone, which was clearly created for bureaucratic convenience and is not the basis on which to deliver the kind of aid that we have discussed.

5.41 pm

Llew Smith (Blaenau Gwent) (Lab): Before I became a Member of Parliament, I spent 10 years as a Member of the European Parliament. Throughout those 10 years, I and other Labour MEPs campaigned for
 
12 Jan 2005 : Column 385
 
objective 1 or a scheme that could deliver similar investment not only in Wales, but throughout the United Kingdom. Like those Labour MEPs, I would like to claim credit for delivering objective 1, but in my more modest moments, I admit that its successful introduction was because of the election of the Labour Government, without which objective 1 money would not have come into communities in my area, south Wales.

I remember when nationalists in Wales argued that it would be impossible to introduce objective 1 into Wales because of the absence of a Welsh Parliament and the lack of independence for Wales. The Labour Government showed that independence and a Welsh Parliament were irrelevant and that, given energy and ideas, it was possible to deliver objective 1. They delivered objective 1, from which communities such as mine have benefited for a number of years.

Objective 1 can play a major role in helping to revive communities. In Blaenau Gwent, for example, we have some of the highest levels of unemployment in Wales, some of the lowest wages in the United Kingdom and some of the worst health problems, which involve heart disease, respiratory disease and lung cancer. We are near the top of the list for problems relating to mental health, we have low levels of car ownership and our housing stock is very poor. Those problems have not gone away as a result of objective 1, but objective 1 can play a major role in particular communities.

We should not try to convince ourselves that the problems have gone away. In Blaenau Gwent, for example, we still have a major unemployment problem, which involves not only the number of people who are unemployed but the kind of jobs that we have lost in our communities. We have lost a big part of our manufacturing base. In the 1980s, we lost the coal industry, which was a major supplier of jobs in our particular community. More recently, we have lost the steel industry and other major manufacturing companies such as Bosal and Faurecia. Just before Christmas, Yuasa Battery announced that it was to make between 200 and 300 people redundant and the work was to go to another country.

Just last week, I met the work force of Merton Packaging, which has been functioning in my community for the past 20 years. The work force are very skilled, highly motivated and loyal—so loyal that they have not had a wage increase for four or five years. On returning to work after the Christmas holidays, they found that the doors were locked and were told that the company was going into liquidation. That is the kind of behaviour that one would expect of a 19th-century employer, but this is a present-day employer, operating in my community.

It is not only the number of jobs that is important, but the kind of jobs. We have attracted jobs to Blaenau Gwent, but far too many of them have been low-paid, part-time, non-union, soul-destroying jobs. It is interesting that we, like other parts of the country, are losing jobs to other countries, but our jobs are being lost from a community that has some of the lowest wage levels in the United Kingdom. If we cannot reclaim those jobs, there are obviously problems in other parts of the UK.
 
12 Jan 2005 : Column 386
 

On tackling low wages, the minimum wage has obviously been an important policy development for my community, but it is still much too low. It needs to be dramatically increased if people are to have the dignified lives that they deserve for their labours.

In Wales, we have an additional problem in that much of the investment, which is the responsibility of the National Assembly for Wales, has been directed not to some of the poorest and most deprived areas but to some of the richest communities in Wales. There is a shortage of money in many areas, including Blaenau Gwent, but investment is going to places such as Cardiff bay. We saw an example of that just before Christmas, with the opening of the Wales Millennium Centre, a glorified opera house, which cost over £100 million and has been guaranteed by Rhodri Morgan a permanent subsidy of £2 million a year. Just imagine what some of the deprived communities in Wales could do if they received the kind of money going to the richest areas. We need to continue and increase the investment going to those deprived communities. With the amount of money going to Cardiff bay, Blaenau Gwent could revolutionise life in our community. Objective 1, with all its limitations, must continue in one form or another.

If we are to attract jobs to Blaenau Gwent, we are told that we must concentrate on high-skilled jobs. I agree to a certain extent, but we have problems because the amount of investment in further education in Gwent is decided by the quango Coleg Gwent. Midway through last year, it decided to close the engineering and catering departments in my constituency, which is probably the most deprived area in Wales. The new principal of Coleg Gwent and the deputy director of ELWa said, "Not to worry—your constituents can still study engineering but they can do it in Nash, which is in the outer part of Newport." I do not have a PhD in geography, but I understand the difficulty of travelling from my constituency to Nash in Newport. Indeed, if a student from Blaenau Gwent wished to study engineering in Nash, it would take a round trip of five hours. If he or she decided to spend five hours on public transport, they still would not arrive in Nash in time for the commencement of the course each day. How can communities such as ours concentrate on trying to attract high-skilled jobs when the people responsible for further education are closing the very departments that can deliver the training and education necessary for those jobs?

Other people in authority have said, "We've got to concentrate on attracting tourism to Blaenau Gwent, because it is a beautiful part of the world." No one doubts that. Yet the people who control Gwent's further education decided to close the catering department. How can we boost tourism in Blaenau Gwent by closing the catering department, which plays an integral part in the training required for a buoyant tourist industry?

The problem with objective 1 is not a shortage of money, but priorities. In the years when I was in the European Parliament, the priority was to concentrate on directing moneys towards the agricultural sector through the common agricultural policy. Every year, at budget time, the Commissioner would make a statement in which he told us, "Things are not well with the common agricultural policy, but not to worry—tomorrow all these things will be changed, the problems will be rectified and the amounts directed to agriculture
 
12 Jan 2005 : Column 387
 
will decrease." In other words, areas such as mine would benefit. That has not happened over the past decade or so, and I suggest that it will not happen in any big way in the months and years to come.

If the European Union and the European Parliament are to be seen as relevant by the people outside, they must be seen to be responding to the problems that people have in communities such as mine. Until now, leaving aside noble exceptions such as the objective 1 programme, they have failed in a big way to do that. We must not forget that we are still paying more into the European Union than we are receiving back, even allowing for the rebate. That injustice should be rectified.

My final point concerns who takes the decisions. The hon. Member for St. Ives (Andrew George) spoke about the role of quangos, which has been a contentious subject in Wales. We were told that, if we elected a Welsh Assembly, it would bring about a bonfire of the quangos, but that has not happened—it has been very much a damp squib. Too many decisions in Wales are taken by people who are not elected, not accountable and cannot be removed. That is surely wrong. We want decisions to be taken by people who are elected, are accountable and can be removed if people see that they are not responding to their problems.

We were promised not only a bonfire of the quangos, but that many of their powers would be transferred to democratically elected bodies such as local authorities. That has not happened in Wales. People in Wales know now, if they did not at the time of the referendum for the National Assembly, that they were conned in a big way. Many people went along with it, even though some of us argued and predicted the result.

There are big problems, not only in my community but in communities throughout the United Kingdom that still suffer from unemployment, the loss of good jobs, low wages and all the deprivation that goes with that. We need some sort of scheme to continue after 2006 if our problems are to be rectified.

I want to end as I began. I would like to claim credit for objective 1 funding, and I am sure that other former MEPs would too, but we would admit in our humbler moments that it is due to the election of a Labour Government. I say that as someone who has been somewhat critical of the Government on one, two or perhaps three occasions.

5.55 pm

---