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Lembit Öpik: I am listening with my usual grace to the   Secretary of State outline his position; I agree with some points and disagree with others. He is being disingenuous in the extreme in misrepresenting local income tax in such a way. Does he not acknowledge that the proposal is not a way to increase the tax take, but a means of bringing in the tax take more fairly? How can he tell a pensioner who lives in a large house and has a small income that they should be paying more council tax than a rich married couple who live in a small house and have a large income?

Mr. Hain: We are going to take £200 tax-free off the council tax. That is a very important reduction, which is being welcomed by pensioners up and down Wales. It would be very helpful if we had a debate on local government finance. An investigation is under way on local government finance—there will be a report once the work is completed—to see whether we can make improvements, as there are some unfairnesses in the council tax system. The Lib Dems should come clean on the impact of a local income tax on people earning the average Welsh wage—police officers, teachers, nurses and many other workers.

There are all sorts of problems. Let us consider a very poor county borough council, such as Blaenau Gwent. The local income tax take from Blaenau Gwent would be very small by comparison with that from Monmouth, parts of Cardiff and even Neath Port Talbot. That would leave the county borough council in a very disadvantaged position. There are all sorts of issues on which the Liberal Democrats need to come up front regarding their proposals for a local income tax, as it looks like an easy hit for them when they say that they will abolish the council tax.

Mr. Roger Williams: The Secretary of State asks us to come clean on the effects of a local income tax. Perhaps he would come clean as well. He is always quoting the average Welsh family income. Can he tell us what that is, according to his calculations?

Mr. Hain: These figures come from the Liberal Democrats' own calculations and estimations. I have not plucked them out of thin air. I have said that the average Welsh wage is the one that we should
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benchmark, and I should have thought that the hon. Gentleman would see that as entirely sensible and logical.

Since our last Welsh day debate, Plaid Cymru has lost its councils in Rhondda Cynon Taff and Caerphilly, which came storming back to Labour last June. Perhaps we should not be surprised that it has already told the media that it has given up across Wales. It is fighting to win only one extra seat out of 36.

Ian Lucas (Wrexham) (Lab): I am grateful to my right hon. Friend for giving way. Before he leaves the vexed subject of the Liberal Democrats, will he tell me whether he is aware that, in Wrexham, the Liberal Democrats and Conservatives recently voted against a proposal to extend a successful neighbourhood warden scheme across different parts of the borough? That happened in   the same week in which I received in my flat in Southwark a boastful leaflet from the local Member of   Parliament extolling the virtues and success of the   neighbourhood warden scheme in the Southwark, North and Bermondsey constituency and saying what an excellent scheme it was and how the Liberal Democrats fully supported it.

Mr. Hain: Nothing surprises me about the Liberal Democrats when they get into power. [Interruption.] As I hear pointed out, there is a difference of light years between what they say in opposition, when they make all sorts of exaggerated claims in their "Focus" leaflets and make all sorts of policy promises, and what happens when they get into power, when they fail to deliver and are almost always ejected from office, like Plaid Cymru, when the electorate wake up to them.

Julie Morgan (Cardiff, North) (Lab): Is my right hon. Friend aware that the newly elected Liberal Democrat council in Cardiff has threatened the existence of the women's workshop, an award-winning and pioneering workshop that has brought enormous benefits for disadvantaged women? The grants have been cut, which in turn threatens the European funding.

Mr. Hain: That is indeed shocking and disgraceful. Again, nothing surprises me about the Liberal Democrats when they get into power. I pay tribute to my hon. Friend for the way in which she has supported women's rights throughout Cardiff, Wales and the world, and tenaciously represented the interests of the   women's workshop in Cardiff, which is scandalously being clobbered by the Liberal Democrats.

Lembit Öpik rose—

Mr. Hain: Is the hon. Gentleman going to volunteer another cut by a Liberal Democrat-run council?

Lembit Öpik: The Secretary of State says that nothing surprises him. So will he concede that he was already aware that some of the cuts that are being forced in Cardiff at the moment are specifically due to a Labour Assembly Minister forcing a change in the rules in local government finance, which has meant that even an efficient Liberal Democrat-run council such as Cardiff
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has had to bring back its spending explicitly because of politically motivated edicts prompted by a fear of losing Cardiff, Central to my party?

Mr. Hain: The Assembly Minister for Finance, Local Government and Public Services, Sue Essex, behaved responsibly in making sure that council tax payers in Cardiff did not get a huge tax rise under the Liberal Democrat council. [Interruption.] That is what the Liberal Democrat council was planning, until Sue Essex made it clear that it would be capped if it went ahead with those exorbitant increases.

Why have cuts suddenly begun under Liberal Democrat rule? Liberal Democrats are not interested in the interests of local communities. Over the past few years, Cardiff has been successfully represented by a Labour council. It is now a booming city in every respect, and although the Liberal Democrats may gain some advantage from the plans, spending programmes and visionary leadership of that Labour-led council over the next few years, the electorate will increasingly find them out.

Lembit Öpik: Will the Secretary of State give way?

Mr. Hain: I shall make some progress on Plaid Cymru, before returning to the Liberal Democrats.

Plaid Cymru has told the media that it has given up across Wales and that it is fighting to win only one extra seat out of the 36 that it does not hold—it wants Anglesey back. Last week, I visited the constituency of my hon. Friend the Member for Ynys Môn. It was clear that people do not want to go back to Plaid; they want to go forward with Labour and build on the success that the island is having after so many bleak years. Plaid Cymru cannot win the general election, but it can help the Tory party to win it, and a Labour vote for the nationalists or Liberal Democrats might let the Leader of the Opposition in the back door to No. 10.

This is the choice facing Wales: back to the failed policies of the past, which brought division and depression to our communities, or forward with a Government who are equipped to address the challenges   of today's world. Those challenges include decent wages: those on low incomes need a Labour Government to continue above-inflation increases in the minimum wage, and in the working tax credit and the   child tax credit, both of which make work pay.

Those challenges include home ownership: first-time buyers need a Labour Government to help them get on the housing ladder through the doubling of the stamp duty threshold and the biggest building programme of affordable housing in generations. And all home owners need Labour's successful stewardship of the economy to   keep mortgage rates low—mortgage rates are half   what they were under the previous Conservative Government.

Those challenges include child care: parents need Labour's policies for affordable child care and for children's centres across Wales to provide high-quality pre-school and after-school care. Those challenges include skills: under Labour, every young person will have a guaranteed place in a college or sixth form, or an apprenticeship.
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Those challenges include pensions: under Labour, the pension credit and the winter fuel allowance will be   improved, not abolished. Council tax help from the Budget now means that £400 will drop through pensioners' letterboxes later this year, rising to £500 for the over-80s. Under Labour, free bus travel and a free TV licence are lifelines, not luxuries. The draft Commissioner for Older People (Wales) Bill has been published, and it provides for a champion for older people in Wales.

The future also includes international challenges, such as climate change, world poverty, Africa, the proliferation of nuclear, biological and chemical weapons, human rights and winning the case for Europe—Wales and Britain are stronger in Europe than isolated apart from it.

Our Labour Government are impatient for more change, because there is so much more to do. I believe that the radical Labour vision that we will soon put before the people is one of which the socialists who founded our party more than 100 years ago would have been proud—a radical Labour agenda to transform the quality of life for millions of our people, and billions more across the globe.

There is now a clear choice in Wales on health: record investment pouring in under Labour or guaranteed transfers of NHS funds to subsidise private operations under the Conservatives; shorter waiting times with Labour or waiting much, much longer under the Tories, just like when they were last in power.

There is another clear choice on devolution itself: Labour believes in power being exercised as close to the   people as possible, because we trust the people of Wales to know what is in their best interests and to find   Welsh solutions to Welsh problems. We will strengthen the Assembly, not scrap it, which is the proposal from the hon. Member for Leominster (Mr.   Wiggin). The choice is clear: a stronger Assembly under Labour, or, under the Conservatives, Wales run Redwood-style from London again. The partnership between our Labour Government at Westminster and our Labour Assembly Government in Cardiff is critical to delivering for the people of Wales. Wales must now decide if it wants that partnership to continue, because the Tories have pledged to destroy it.

The Leader of the Opposition was the Minister who   introduced the poll tax. He was the Employment Secretary who presided over an increase in unemployment of more than 1 million, and he was the Home Secretary who cut police numbers by 1,000. He has not changed, because he came to south Wales last year and told us that coalfield communities revived considerably under Margaret Thatcher. Which planet is he living on? It is back to the past with the Tories, or forward with Labour.

This is the choice: a Wales on its back and going backwards—losing out and looked down upon—or a Wales with its chin up, walking tall and moving forward. We should be proud of our nation, proud of our talent, proud of ourselves, proud of Labour's achievements and proud of what we could do with four more years, in which we can build a progressive consensus in Britain that will never, ever allow Wales to be trampled on by destructive right-wing extremism imposed from London.
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6.26 pm

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