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In Wales, we face many challenges to improve our economy, educational opportunities, health care and transport, but those are not peculiarly Welsh issues
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requiring a Welsh-only solution. Only last Friday in this House, we took the historic step of giving Second Reading to a Bill that would secure equal treatment for agency workers. If that Bill gains Royal Assent and becomes law, it will address a scandal that exists throughout Britain. It will benefit the whole of Britain, and Wales as part of Britain.

It is false and pernicious to try to portray the interests of the Welsh people as different from the interests of English people, the Scots or the Irish. Many of the issues that we face are the same. Let us be proud of our Welsh culture, identity and language—proud, as I was today when the children from Ysgol Gymraeg Cwm Gwyddon in my constituency sang at the St David’s day service here in Parliament.

However, in this second month of the new year, let us beware of the danger confronting us: the danger of entering a political cul-de-sac. The temptation is there to spend endless wasted hours on constitutional debate. The chattering classes, the crachach, who believe that they know best for Wales, swoon at the prospect of more powers for the National Assembly. Many in the media think that more powers for Cardiff is the story of the decade—tosh, rubbish. The real people of Wales, the werin, have no time for all of this, and I stand with them.

Disappointing as it may seem to some, more powers for politicians in Cardiff will not be the main topic of conversation in the Top club in Abercarn tomorrow night, or in any pub, club, church or chapel around Wales where Welshmen and women gather. They will talk about the economy, education, health and training, and it is to training that I want to devote most of my remarks. Before I do, however, I pay tribute to my right hon. Friend the Member for Neath (Mr. Hain), who is no longer in his place, for his excellent contribution to the debate today. I also warmly welcome my right hon. Friend the Secretary of State for Wales back to the Wales Office. It was a pleasure and an honour to serve with him when he was last there. I am pleased that his sound judgment, common sense and plain speaking will once again be heard at the Cabinet table.

The Secretary of State will face many difficult issues in the coming months, but I urge him not to be tempted, when he brings proposals for legislation to this House, to make it different simply for the sake of being different. We should make things better when we pass legislation to benefit Wales, but we should not make it different simply for the sake of it. Every step of the way, we must continue to ask ourselves, “Will this measure make life better for the Welsh people?” If the answer is a sincere yes, we should forge ahead. If it is no, we should drop it and pursue other avenues that will yield real change for the betterment of the people of Wales.

I passionately want our Government to succeed for the people of Britain, but I have to say that making things different in Wales in the past has been a barrier and has denied this left-of-centre Government an opportunity to benefit the people of Wales as they have benefited England.

Hywel Williams (Caernarfon) (PC): Would the right hon. Gentleman describe free prescriptions as a barrier to radical policies in Wales? They were introduced by the Welsh Assembly Government.


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Mr. Touhig: They were introduced by the Labour party in Wales, as the hon. Gentleman knows.

We in Wales will face a danger in the coming year from an unhealthy dynamic in Welsh politics. It is a dynamic that is already leading us into a blind alley, which goes by the grand title of the constitutional convention. I am told that the Welsh Assembly is to set aside £500,000 for this self-indulgent, wasteful exercise in navel gazing. That pointless convention is supposed to test the waters to determine whether we should hold a referendum on more powers for Cardiff and when it can be won. I wonder whether the Assembly will make the same amount of public money available to those who want a referendum at a time when the Welsh people will say no to more powers in Cardiff. Perhaps my hon. Friend the Under-Secretary will enlighten us in his winding-up speech.

I can save the Assembly that £500,000; I can help them test the waters. I have a cunning plan. I will take the authors of the idea on a walk down Blackwood high street—or any high street in Wales—and ask people whether they believe that it is worth spending £500,000 on the convention. People will be amazed that we can find that money when there are far more pressing needs.

Wales spends less per head on educating our children than England spends. People will think that we should close that gap. We spend far less than England on further education, and people will think that we should close that gap. Waiting lists for hospital admissions in Wales are longer than those in England. People will think that we should close that gap, too. On top of that, incomes in Wales are lower than elsewhere in Britain and much of Europe. People will certainly think that we should close that gap.

West Wales and the valleys, thanks to the Labour Government, obtained European objective 1 moneys because our income levels were lower than those in the rest of Britain and Europe. However, after six years of that funding, we must ask whether our income levels are any better now. The answer is that they have changed little, and continue to lag behind the rest of the United Kingdom.

So far, to a great extent, objective 1 has been a lost opportunity. The Irish used objective 1 money to upskill their work force and have gone on to become the tiger economy of Europe. We should follow their lead, but we do not. A look through the Welsh European Funding Office list of the largest objective 1 projects shows that the money has been used for agricultural food processing, tourism promotion, and a Royal Society for the Protection of Birds scheme called, “Aren’t Welsh Birds Brilliant!” I have no doubt that those are worthy causes, and I do not want to denigrate them, but are we seriously saying that they are priorities for investing the European money that we have won for Wales?

Furthermore, the administration of objective 1 has been a bureaucratic nightmare, bound up in red tape. Only yesterday, the Welsh Local Government Association expressed frustration that, after 15 months of the new European structural fund programme, so little progress has been made.

Mr. Llwyd: Who has been in charge of the programme for the past six years?


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Mr. Touhig: The hon. Gentleman is aware of my views on those matters. Those responsible in the Assembly have taken their eye off the ball. Objective 1, and the convergence fund that has now replaced it, should be about increasing income levels and raising the standard of living. To do that, it should be used for upskilling and training above all else.

Cicero said:

I believe in that. For me, politics should be about the common good, not responding to greed, selfishness and narrow personal interests. This great Labour party stands for social justice, fairness and equality of opportunity. In the past 10 years, the Government have brought great achievements to fruition. There are more people in work, a record amount of new jobs has been created, and full employment is a near reality. Our economy is strong, our people are more prosperous, and investment in health and education is at record levels. We have a solid base on which to build.

However, our economic future will be secure only if we invest in training and upskilling our people. We need to give the people of Wales the skills that they do not yet have in order to create the jobs that we do not yet have. Wales in the 21st century can become the dragon economy of Europe. When Labour came to power, at the start of the journey to reform Britain more than a decade ago, Tony Blair declared that his priority was education, education, education. He was right, but now we must take the next step. Now our priority should be training, training, training. Everyone will have to go back to school to improve their skills.

When my father went underground at the age of 14, it was the muscles in his arms that he needed to develop. My twin granddaughters, now aged 14, must develop the muscles between their ears if they want to get the right knowledge and skills to have a future.

The great challenges that we face in the coming years are not Welsh but global. We are part of a world in which powerful new economies such as China and India will challenge and overtake Europe and the United States. China enrolled 15 million students in tertiary education in 2004, but there the average industrial wage is but 60p an hour. Wales—and, for that matter, Britain—cannot compete if we remain a low-skill, low-wage economy. The only way we will compete is by retraining and upskilling. We have to keep ahead with new and innovative ideas, which we can fully exploit only if we have the skills to do so.

The challenge to Wales will be all the greater because we are on the edge of Europe geographically, but we can be at the heart of Europe economically. There are some in other parties in the House who will happily mislead the people by saying that Labour is interested only in middle England. When I first heard that I wondered how the hopes and aspirations of people in middle England were different from those of people in Islwyn, for example, so I did some research. I did not find much difference. In fact, I discovered that people in middle England want a job and a decent education for their children. The people of Islwyn want that as well. People in middle England want a first-class health
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service free at the point of need. People in Islwyn want that, too. In middle England, people want good public services to take care of them and a decent pension to live on in old age. Funnily enough, I found that people in Islwyn want exactly the same thing.

Hywel Williams: Will the right hon. Gentleman give way?

Mr. Touhig: I will not, because I am short of time, as I am sure the hon. Gentleman will understand.

Those who claim that we in Wales are so different from those in England that our future must be as an independent country in Europe often point to Ireland, Belgium, and Holland, but they are misguided. They fail to remind us that those independent countries are now part of a greater Europe, sharing decision making and law making, and common goals and objectives. Countries such as Ireland, Belgium and Holland want to be part of an ever-growing Union; they do not want to secede from one. There is no logic in having Wales leave the United Kingdom, one of the big players on the European stage, to stand alone as a minor player with very little voice and even less bargaining power. That would be tantamount to the emasculation of Wales.

The separatists would have Wales end its long marriage with England only to enter a polygamous marriage with half of Europe in a Union that would include England. Are they really serious? If this were an Alan Bennett play or a Brian Rix farce, the men in white coats would be coming on stage now. I am proud to be Welsh, but separatism is nonsense. I want a Wales that is at the heart of Britain and a Britain that is at the heart of Europe.

Wales can and should have the ambition to be an economic powerhouse within the Union of Great Britain. However, to achieve that ambition we must face up to the challenge of creating a work force who are trained and equipped with all the skills necessary to compete on the global stage. No one who leaves education today, in Wales or anywhere else in Britain, can expect to have a job for life. Everyone will have to retrain and reskill throughout their working lives. No one should be left at home, existing on benefits, if they can work, retrain and upskill to get a job.

The bread and butter issues facing us in Wales and throughout Britain do not involve constitutional tinkering. The bread and butter issues are the economy, jobs, education, training, health, pensions and transport. Those are the issues that concern the people who send us to Westminster. Skills are the key to those issues. If we want the money to invest in education, training and so on, we must first get the jobs. To get the jobs, we have to invest in upskilling our people. Then they will get the jobs to pay the taxes and we will be able to invest in all the good public services that we want in our country. A highly skilled, highly paid work force will close the income gap and objective 1 will then be a resounding success.

The challenge facing the Government, as they work in partnership with our friends and colleagues in the National Assembly for Wales, is to ensure that every penny of objective 1 money and transitional funding
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currently left unspent is dedicated entirely to upskilling our people and providing them with new skills and new training. That is the challenge that we face. My plea to those on the Treasury Bench is simply this: do not let us down.

3.34 pm

Mr. Elfyn Llwyd (Meirionnydd Nant Conwy) (PC): I should like to add my voice to those of hon. Members who have welcomed the re-appointment of the Secretary of State. I congratulate him, and I am sure that he will do very well in the post. May I also unreservedly apologise to him for the slur cast by the hon. Member for Brecon and Radnorshire (Mr. Williams), who implied that the Secretary of State and I were converging politically? That will undoubtedly be damaging to him, but I hope that it causes him less anxiety than it might just cause me. Apart from the skilling bit, I disagreed with everything the right hon. Member for Islwyn (Mr. Touhig) said. He was meticulous, however, in the way he put his speech over. I noted much of what was said by the hon. Member for Carmarthen, West and South Pembrokeshire (Nick Ainger), and I thought that he made an interesting contribution.

I am not going to talk Wales down. That has already been done by the right hon. Member for Islwyn. There are problems in Wales, but I am not saying that all is bad. There is less unemployment than there was, by a long chalk. The trouble is, however, that wages are low. We need to upgrade and upskill, as the right hon. Gentleman rightly said, in order to succeed. Emphasis will no doubt be placed on that in the coming months and years. I do not share the right hon. Gentleman’s view that the objective 1 money has been a complete waste, but it has not been put to good use. It could have been used better.

Mr. Touhig: I was not suggesting for one moment that it was a complete waste. I said I was concerned that it had not been used, as it could have been, to give people the skills they need in order to close the income gap that concerns us all.

Mr. Llwyd: In that case, I agree fully with the right hon. Gentleman and I apologise for misinterpreting what he said.

We also have the rather bizarre problem of the Department for Work and Pensions job cuts on the horizon. There are now 32 towns in Wales that no longer have a DWP office. A large number of jobs have already gone, and 28 of the 33 proposed closures are in the objective 1 area. This is part of the debate that we have just had on upskilling and our gross domestic product. These are big problems. The right hon. Gentleman asked what was different about Wales. This is different: no matter how many times we shout about the problems caused by job cuts in objective 1 areas, nobody takes a blind bit of notice and the cuts go ahead. That is one difference.

The job cuts at HMRC are expected to result in the closure of a further 14 offices, with 750 job losses in Wales, 550 of which will be in the objective 1 area. How can we possibly say that we want to raise the GDP or the gross value added in the objective 1 area if this is happening? Those are good, steady jobs—even if they are not hugely well paid—yet they are disappearing.
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Hundreds of them are going, including 35 in Porthmadog and 50 in Bangor. Some of them will undoubtedly involve voluntary redundancy, but a great deal of damage will none the less be done to the economy in various parts of the objective 1 area of Wales. If we look at the map, we see that the job cuts come within the arc of the objective 1 area. I am extremely disappointed that that is so.

Jeff Evans of the Public and Commercial Services Union in Wales has said:

Albert Owen: The hon. Gentleman knows that there is much cross-party opposition to the closure of DWP offices in western Wales. Another possible threat to jobs is likely to be caused by the merger of national health service trusts in north Wales. I am afraid that that proposal is backed by the leader of Plaid Cymru in Wales, who believes that they positively should merge. The merger would result in a drift of jobs eastwards from north-west Wales from the trust that covers the hon. Gentleman’s constituency and mine. Does he agree that we need to be consistent on this issue, and that we need to fight at all levels to keep highly paid, highly skilled jobs in north-west Wales and in the objective 1 area?

Mr. Llwyd: Of course I agree with the hon. Gentleman and make no bones about that, but I am addressing another subject. I hope he agrees with what I am saying about that, as I agree with him on this. Our priority for that part of Wales is to ensure that the economy is as buoyant as it possibly can be and the main ingredient clearly must be well-paid jobs.

I met the Secretary of State to discuss these matters on 6 February; in fairness, he pledged that he would take them up with ministerial colleagues. I have no doubt that he will do so, but when the Under-Secretary winds up the debate, perhaps he will tell us whether there is any good news yet. I certainly know the right hon. Gentleman well enough to know that if he says he will discuss the matter, he will.

Today, however, we hear that Driver and Vehicle Licensing Agency staff in Swansea have discovered that they are grossly underpaid in comparison with their colleagues in England. That, I am afraid, is another reason why Wales is different. DVLA workers in Swansea are paid £15,725 in comparison with £18,050 with workers over the border—not in London, but just over the border. The total saving to the Exchequer from that is £17 million—money saved by underpaying hard workers down in Swansea. As Sian Wiblin of the Public and Commercial Services Union said:

I strongly believe that that must be reversed. We must not allow regional pay to dominate; if it does, we shall never get anything real out of objective 1. If we are not very careful, we will unfortunately become a sweat shop economy. I am sure that no one in the House or outside it would like that.


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Let me cite the editorial comment in today’s edition of the Western Mail:

It goes on to say that the objective 1 money is meant

Clearly, that is nonsense, so I hope that at some point Ministers will make strong representations to their colleagues because, as the Western Mail says, this is a step backwards at a time when Wales is striving to become a dynamic modern economy. As the paper concludes:


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