Hywel
Williams: Is it not likely that the divergence between a
successful Government in Wales—their spending priorities and
success—and the Government here in Westminster is likely to get
even greater if we have a Conservative Government cutting public
spending
here?
Mr.
Llwyd: That is the scenario that we are all concerned
about. Until such time as we know what plans the Conservatives have, it
will be a worry that we all have to come to terms
with.
David
T.C. Davies: Does the hon. Gentleman agree that there is a
big difference between reducing public spending and cutting public
services?
Mr.
Llwyd: There is a difference, which escapes most of
us.
David
T.C. Davies: I can
explain.
Mr.
Llwyd: The hon. Gentleman can explain when he makes his
own speech. The end product is downgrading of public services, because
fewer public services are available—it does not take a genius to
work that one out. He can make his point in due course, if he catches
the Chairman’s eye.
Lembit
Öpik: I agree very much with what the hon.
Gentleman is saying. Does he agree that it is something of a false
economy to cut the tax services administered in Wales? For example, the
Welshpool tax office is under threat of closure next year. In my
judgment, closure of the office will reduce the tax take by more than
the anticipated saving. Some of the Government cuts are a false
economy.
Mr.
Llwyd: The hon. Gentleman is right in what he says. No
doubt he has raised concerns about local offices in his constituency,
and I have been to see the Secretary of State on several occasions
about the issue. In such austere times as are ahead of us, we must
ensure that the services are up to scratch and available. For
heaven’s sake, we now have 33 towns in Wales without a
Department for Work and Pensions office. We had fewer tax offices to
begin with, but we have fewer still now. We are being denuded of this
important service. I do not know whether that is a cut, but I shall not
excite the hon. Member for Monmouth and get him on his feet by
referring to
that.
Mr.
Roger Williams: I know that the hon. Gentleman represents
a rural and sparsely populated constituency as well, but when I was in
Knighton over the weekend, I was approached by a lady who said that she
regularly takes people who are unemployed from Knighton to Llandrindod
to sign on. There has not been an office closure there, but that shows
the difficulty of access for people who become unemployed in rural
areas. Would it not be a good idea if there was an extension service
for one day or half a day a week to the more outlying towns and
communities?
Mr.
Llwyd: I agree entirely—an outreach service of some
kind is exactly what is required. Without being seen to talk Wales
down, one of the consequences of the credit crunch, inevitably, is that
jobs will be lost. Therefore, there is even greater need for that
service. That is fairly obvious to me and, at some point, I hope it
will be obvious to the Government, but currently it is certainly not in
the framework in Wales. Due to the lack of detail in either the
operational efficiency report or the Budget, the effects on Wales have
been reduced to a series of calculations on the back of what used to be
known as a fag
packet. The
Welsh Assembly Government and the Wales Office were clearly at odds in
their interpretation of the Budget. In reality, any detailed
examination of the figures is hampered because, in the absence of a new
comprehensive spending review, there are no publicly available figures.
Even the figures that are available in the Budget are fraught with
danger: looking at the 2009-10 Budget of £13.6 billion, do we
know where that lies between the £13.55 billion and the
£13.64 billion that have been referred to?
From the
Welsh Government’s point of view, they can hardly run a sensible
budget if they do not know whether they will receive up to an extra
£100 million per annum. If the Treasury really does not
calculate the figures to a greater degree of granularity, it will have
to start doing so, as this Budget is clearly not fit for
purpose.
As I
mentioned to the hon. Member for Chesham and Amersham—I invite
her to comment—we would recommend that in future Budgets the
Chancellor should
make it absolutely clear in the appendices to the Budget documentation
what the exact budgetary situation was for the devolved Administration,
so that there could be immediate clarity. That would be all to the
good. Such
clarity would inform the debate there and then, and it would prevent
people from bandying figures around. We would know precisely where we
were. That is a small thing to ask, but I suspect that the Treasury
mandarins would be unhappy about doing it, because they are secretive
individuals and not likely to want the light of day to be shed on some
of their
workings.
Mrs.
Gillan: I am glad that the hon. Gentleman agrees with me
that there should be more transparency about the effect on Wales of the
Budget and the pre-Budget report. Despite all the posturing over
devolution, it is rather sad that, 10 years after it, we still have to
hunt around for the figures.
However, the
hon. Gentleman’s party is in government in Wales—in the
Welsh Assembly Government. I wondered what he would do about the job
cuts that he, of course, has direct control over, by virtue of
devolution. The Welsh Local Government Association estimates
that 11 councils expect to make job cuts in 2009-10, leading
to the loss of 700 jobs in Wales, and that up to 2,000 jobs will be
lost in 2011. Given that his party is in government, the hon. Gentleman
has the opportunity to tell us how he will deal with those
cuts.
Mr.
Llwyd: The hon. Lady refers to the WLGA, so I presume she
is talking about public service jobs in local government. In fact, that
has more to do with the Budget settlement from Westminster.
[Interruption.] Well, it is also to do with the
Barnett crunch that we have referred to, and with identifiable public
expenditure. There are various reasons why there are heavy pressures on
the
budget.
Mrs.
Gillan: Is the hon. Gentleman therefore backing the
settlements given to local government by his party, in government in
the National
Assembly?
Mr.
Llwyd: I can assure the hon. Lady that my colleagues in
Cardiff are doing everything they can under the One Wales agreement to
deliver what they said they would deliver. I also know that urgent
discussions are taking place on this issue between Labour members of
the Cabinet and Plaid Cymru Members. For example, I know that the First
Minister has been to see the Prime Minister about the imminent
£500 million or £600 million cut. So, all this
is being properly looked
at.
Mr.
Llwyd: Yes, it is being properly looked
at.
Mrs.
Gillan: The Secretary of State did not tell us
that.
Mr.
Llwyd: The Secretary of State was probably not asked about
it and that is why he did not tell the hon. Lady, but there we are.
[Interruption.] Well, it is more than that over
the next two or three years. [Interruption.] Well,
it is part of the reason why I mentioned earlier
that, if we knew in the appendices to the Budget precisely what the
situation was, we would not be bandying figures
around.
The
Parliamentary Under-Secretary of State for Wales (Mr. Wayne
David): We do know the figures—the Welsh Assembly
Government have given the hon. Gentleman the figures, as has the Wales
Office. Along with certain elements of the media, he refuses to accept
those figures. It is as simple as that.
Mr.
Llwyd: Well, there we are
then.
Mr.
David Jones: Given that the hon. Gentleman clearly does
not trust the Labour Government’s figures, why is he propping
them up in
Cardiff?
Mr.
Llwyd: I did not say that I do not trust the figures. If
the hon. Gentleman would
listen—
Mr.
Jones: I am
listening.
Mr.
Llwyd: Well, if the hon. Gentleman had listened to what I
said earlier, he would know that I said that the people in the Treasury
are very secretive animals. They would not be happy to make the true
position too obvious. I do not say that I do not trust the figures;
rather, I am not sure what they are, and we cannot possibly conduct a
reasonable debate on the Budget if we do not know the precise figures
and what the budgetary situation for the devolved Administrations will
be as a consequence of this year’s Budget. That is the point I
was making. I was not implying any distrust of anyone in this
room—not even of the hon. Gentleman
himself. Having
taken all the factors into account, the Institute for Fiscal Studies
estimates that if the United Kingdom is to meet its debt interest and
repayment obligations, there will be a cut of 2.3 per cent. per year
from current spending budgets over this period. That would lead to a
£300 million cut in the Welsh Government budget each year
between 2011 and 2014. That would be a £600 million
cut in the Welsh budget in 2012-13 compared with 2010-11, rising to
£900 million in 2013-14. Cumulatively, that would be a budget
cut of £1.8 billion over three years. So says the
IFS. However,
that is just one part of the story. If we also take into consideration
the Chancellor’s comment that capital spend will come down to
1.25 per cent. of GDP, we can assume a 17 per cent. cut in capital
spending in Wales, a cut of £300 million in 2011-12, and a
cumulative loss of £900 million from capital programmes in Wales
over that period, as well as very little current spending. That takes
the whole of the cuts to about £2.7 billion, but let us remember
that that does not even include the £416 million of cuts
scheduled to take place next year. If that is included in the
calculations, we are looking at a cumulative loss to Wales over four
years of about £4.3
billion. Before
someone jumps up and down and says, “What on earth can be
done?”, let me point out that my party suggested in its
alternative ideas on the Budget that we should be considering medium
and long-term schemes that would benefit Wales. We had, and have, a
vision for
a better Wales. We believe that targeted positive investment in
intergenerational projects is the best way out of the current economic
mess. Our children and grandchildren will have to pay for the failures
of the laissez-faire economics that have recently been promoted. We
want to see a greener and better world. We want to see a green new
deal. That would have created thousands of jobs through reorienting our
manufacturing and industrial base towards green and renewable energies.
As we all recognise and as the right hon. Member for Neath has said on
more than one occasion, Wales is very well placed in respect of green
and renewable
energy. Mark
Williams (Ceredigion) (LD): I am sure that the hon.
Gentleman recognises the essential role for the higher education
institutions of Wales. He is aware of the excellent work, for instance,
of the university of Aberystwyth in developing biofuels, and of the
centre for alternative technology in Machynlleth. That huge potential
also needs to be developed if we are to realise the green economy he is
looking
to.
Mr.
Llwyd: The hon. Gentleman is absolutely right, and his
comments build on what the hon. Member for Aberavon said about the
importance of the university and higher education sector regarding the
summits that have been and are being arranged, which I think are a good
thing. Those comments bolster my argument that we are well placed not
simply in terms of the essentials—the topography of
Wales—but of the research and science. The point is very well
made. My
party would have liked to see new policies to retrofit housing to save
energy and cut bills, especially to help those in fuel poverty. We
would have invested heavily in public transport, especially an
all-Wales rail network. We would like finally to see that link between
north and south Wales, which would have a massive long-term impact on
our country. In the short term, steel and construction—the two
Welsh industries hit hardest by the recession—would be helped,
but in the longer term that link would be an important cog for business
across Wales, allowing people to travel from one end of the country to
the other and improving both business and social cohesion in
Wales.
Mrs.
Gillan: I am interested to hear the theme the hon.
Gentleman is pursuing on transport arrangements in Wales. As he knows,
I have on many occasions spoken about transport to and from Wales, and
I think he has supported what I said. What estimate has he made of the
cost of his proposed north-south rail
link?
Mr.
Llwyd: Those figures are, I believe, available in the
National Assembly and have been discussed by Assembly Ministers. I
confess that I do not have them to hand, but I shall write to the hon.
Lady with a proper response to that question, which was properly
put.
In addition,
we would like a start to be made on the electrification of the north
and south Wales main lines to improve our environmental efficiency.
Under our green new deal, we would also have introduced investment and
plans to harness the power from the Severn tidal range—an issue
that the right hon. Member for Neath mentioned. We would have put money
into developing green and renewable energy in the next few years from
that excellent source, without destroying the natural habitat. We have
the expertise, as the hon. Member for Ceredigion
mentioned. Chris
Ruane: On green and renewable energy, will the hon.
Gentleman pay tribute to the Optronics Technology and Incubation Centre
at St. Asaph in my constituency? It is working on photovoltaic paint
and an element of fusion power, which would be nirvana if we
ever achieved
it.
Mr.
Llwyd: The hon. Gentleman is like a parliamentary Jimmy
Greaves: if he sees a goal in front of him and has a ball at his feet,
he shoots. Of course I agree; I am quite happy to do so and to
congratulate the company concerned. Jimmy Greaves—that shows my
age, does not it? Can anyone suggest anyone else? Wayne
Rooney?
Mr.
Llwyd: Torres; fair enough.
Some have
argued that the green revolution we envisage cannot be afforded. We, on
the other hand, are on the side of David Blanchflower, a member of the
Bank of England’s Monetary Policy
Committee.
Chris
Ruane: Danny
Blanchflower!
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