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2.18 pm

Ann Clwyd (Cynon Valley) (Lab): I am afraid that daffodils are in short supply at the moment. Very few of us have been able to get the real thing, but some of us have made an attempt and compromised, with at least a flash of yellow on our coats. [ Interruption. ] The hon. Member for Chesham and Amersham (Mrs. Gillan) must have a good arrangement with the flower lady in the House of Commons then. Things are a bit difficult, but I hope that in future we will see large bunches of daffodils brought in for this debate for Dydd Gwyl Dewi Sant, or St. David's day. I would also like it to be held on 1 March, but we never seem to manage that.

I would like to reiterate what my right hon. Friend the Member for Torfaen (Mr. Murphy) said in his speech about how Wales has improved over the years, particularly under a Labour Government. I first became an elected Member in 1979, when the hon. Member for Brecon and Radnorshire (Mr. Williams) was in Brecon and Radnorshire, which was in my European constituency. I hope that I do not embarrass him, but I was very grateful for his help at that time. We remain good friends, even though we are on opposite sides of the Chamber, and I hope that he might help me in other campaigns some time in the future.

When I was first elected, as a Euro MP, there were big job changes in steel and coal. I remember the devastating effect of that, with Llanelli and Swansea being in my European constituency. I was continually taking groups of steel workers threatened by closure-something that ultimately became a fact-to protest in Brussels. I also remember the Social Affairs and Employment Commissioner being aghast that the UK did not seem to have a social policy to cushion the effects of unemployment, which was gradually growing in the steel industry. Almost every other country in the European Community at that time had a social policy. We did not, and we were strongly criticised for that by the Commissioner at the time. In fact, when 5,000 comparable steel workers in Germany lost their jobs in the Ruhr, almost every one had another job to go to. Unfortunately, that was not the case in Wales, or indeed in the rest of the UK. Fortunately, attitudes are now very different.

I was then elected to this place in 1984, in the middle of the miners' strike, in a by-election. That was a time when we did not have to knock on doors, as all the people we wanted to canvass were sitting outside their doors, because they were not at work. The effects of the miners' strike and the lack of either a social policy or any compassion towards those miners, who were fighting for their jobs, were evident. I took a Conservative colleague to my constituency, at his request, to see the effects of the miners' strike on the people of the Cynon Valley. He came away shocked, and I remember clearly what he said: "People look different. They look ill. That is not what the kind of conservatism that I understand should be all about."

David T. C. Davies (Monmouth) (Con): The right hon. Lady is making some interesting comments, but does she not also accept that the strike was called
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without proper consultation of National Union of Mineworkers members-had they been properly consulted, it is likely that they would have voted against it-and that that is what caused a lot of the damage?

Ann Clwyd: The leaders of the miners' strike at that time predicted that the coal mines were going to shut. They were fighting for their very existence. It was important that they engaged in that fight and drew attention to the fact that those jobs were going to go. The hon. Gentleman knows as well as I do that the Prime Minister at the time-the leader of his party-was hellbent on bringing the miners' union down, by whatever means, and the miners knew it too. There were criticisms to be made of those leading the miners' strike, and they were indeed criticised subsequently. Nevertheless, they were right in their interpretation of what was going to happen to their industry.

David T. C. Davies rose-

Ann Clwyd: No, let me continue. I saw the effect of being out of work on those people in the Cynon Valley. It was an effect that lasted for many years afterwards, because they had to borrow money to pay mortgages and to live. There were also soup kitchens, which I and several of my colleagues here in the Chamber were involved in, just to try to feed people who could no longer afford to feed their families.

People who have lived through that kind of situation realise that much more compassion is now shown towards people who are unemployed, or who might become unemployed, and that cushions are in place to assist them. It is therefore not surprising that people like me, who have lived through those years, feel that a Labour Government have done much better by my constituents than the previous Tory Government did. I was in opposition for 18 years, as a Euro MP and, later, when I came here, so I know the difference. I am sure that most of my constituents still appreciate that difference as well.

Another thing that has happened in the valleys is that the environment has changed, partly because some of the older industries have gone but also because of the greater appreciation of the need for a good environment. The Phurnacite plant was in my constituency when I was first elected, for example. It had seven large chimneys that spewed smoke of different colours into the air. The health of the people living in the area and of those working in the plant was affected by that. Indeed, a test case is going through at the moment involving people who worked at the Phurnacite plant at Abercwmboi. The environment has now changed beyond recognition, making it a much more pleasant place to live. I am grateful to our Government for making that possible and for concentrating a great many resources on improving the environment for the people there.

There are many other things that I would like to talk about. The position of women has also changed in Wales. There are far more women in Parliament now, certainly on this side of the House. I hope that there will be more women on both sides after the next election. It has been a long, hard battle for women, as I know full well, and I was pleased when more women came from Wales to join me here. I hope that the number of women MPs from Wales will continue to grow after the election. I should like to pay tribute to my colleagues who are
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retiring at the election. I thank them for their friendship and for all that they have given to the House while they have been here. I will not name them individually, but they know who I mean.

I want to pick up on some of the points raised by the Secretary of State for Wales earlier. I have already mentioned the Robin Hood tax. The people of my constituency feel strongly about a number of issues at the moment. There is still anger about the role of the banks in the financial crisis, and about the unacceptable levels of pay. The recession that we have been through-and that I hope we have now seen the back of-has affected people's jobs and mortgages, and in all sorts of other ways.

The recession was caused-or at least made worse-in part by the global financial crisis. I believe that that was caused by the irresponsible practices of global banks and financial institutions, and by economies relying too much on that financial sector. As my right hon. Friend the Secretary of State said, people understand that the collapse of the whole banking sector would have been disastrous for the economy, and that the Government were right to bail out the banks to prevent that from happening. That much they go along with.

Mr. David Jones: Will the right hon. Lady give way?

Ann Clwyd: Let me just finish my argument, please. Then I will happily give way.

What most people think, and what common sense tells us, is that, after all that taxpayers' money had been used to prop up the banks, the deal was that the banks would look again at how they did things, and that they would start to behave more responsibly. As the Secretary of State said, people do not understand how the Royal Bank of Scotland-the majority of which is owned by the taxpayer-can make a loss, as announced today, and at the same time argue with a straight face that it needs to pay substantial bonuses. Last year, I introduced my own Bankers' Pensions (Limits) Bill, which would have addressed the absurd pension packages being awarded to failed bank executives. Therefore, I very much welcome the one-off bankers bonus tax introduced by the Government. Even better than a one-off tax would be a tax on every year's bonus round.

We should go further still. I fully support the idea of a Robin Hood tax on global financial transactions, which could be used to address the causes of global poverty, to fund some of our own public services, or just to underwrite the financial system so that it is in a position to bail itself out in future. That is one of a number of measures that could inject a little more responsibility into the financial system. I am pleased that the Prime Minister has said that he supports the idea, as long as he gets global support for it, and I hope it will become a reality.

Mr. Jones: The right hon. Lady mentions the failure of the banks. Does she share the view of the Governor of the Bank of England that had the regulatory regime that was in place not been in place, and had there been an overarching responsibility on the part of one regulator, the failures of the banks would have been nipped in the bud? On bank bonuses, is she aware that in the case of
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the Royal Bank of Scotland, they are to be confined to employees earning less than £39,000 a year, and that the Prime Minister has indicated through his spokesman today that those bonuses are in line with what he approves of?

Ann Clwyd: I find it quite amusing to be lectured on regulation by a party that has constantly argued against regulation and in favour of deregulation. I cannot take the hon. Gentleman seriously when he makes such a point. Instead of making personal points to the Prime Minister, why does he not talk about the economy to the Prime Minister when he next has the opportunity?

Hywel Williams: I was wondering whether the right hon. Lady would refer to the fact that the UK economy is overly dependent on the financial sector, as she pointed out earlier. However, it was her Government who were in charge at the time when manufacturing in Wales was completely decimated and the over-emphasis on the financial sector came about.

Ann Clwyd: I had finished my argument on that point and did not expect to expand on it further. I just make the point that I am in favour of a Robin Hood tax, and I would like to hear a response from the Opposition on that.

Lembit Öpik: Does the right hon. Lady share with me a sense of wonderment at the cheek of the Conservative party for criticising the current regulatory system, which, to some extent, allowed the banking collapse, given that the Conservative Government created that very system?

Ann Clwyd: I thank the hon. Gentleman for making that point. In my original answer, I said that I could not take seriously arguments on regulation or deregulation from the Conservative party.

Hywel Williams: The right hon. Lady asked for a response on what is now called the Robin Hood tax. That has been a policy of my party for many years, and I am glad to see other parties coming on board.

Ann Clwyd: At least we have support from one section of the Opposition.

We should also explore the idea of a high pay commission, which could be modelled on the Low Pay Commission. It would look at the effects of very high pay-people earning millions of pounds in salaries and bonuses-on the economy and wider society. Very large inequalities in pay, and people earning very high pay, distort the economy and are bad for the well-being of society. The Government needed to be there to prevent the collapse of the banks and its impact on the economy, but they also need to be there to support people when they are struggling and require help. The Tories simply do not understand that. I was here in the 1980s and '90s and remember their attitude towards people then.

As my right hon. Friend the Secretary of State observed, for the Tories unemployment was a price worth paying, despite its devastating consequences for individuals and communities. I do not believe that their attitudes have changed at all since then. I think that when the Tories talk about cutting state involvement in people's lives, they mean cutting support for people. I think that the
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difference between a Labour and a Tory Government-which is becoming all too apparent-is that Labour understands that when people are struggling they look to the Government for support, and understands that Governments can be a force for good.

In my constituency, 8,200 families are receiving child or working tax credit. In April, a £65 increase in the child element of child tax credit will benefit more than 200,000 families in Wales. More than 4,000 pensioner households in Cynon Valley receive pension credit. There are also winter fuel payments of £250 for the over-60s and £400 for the over-80s, along with, this winter, cold weather payments of £25 a week.

More people have kept their jobs and more businesses have kept going because of the action taken by the Labour Government throughout the recession. The rate of job losses during this recession has been four times lower than it was in the 1990s. In Cynon Valley, the new deal job schemes have created 3,390 jobs since 1997. Other schemes, such as the future jobs fund, are helping people into jobs rather than throwing them on the scrapheap as the Tories did. Labour is supporting young people by guaranteeing an education or training place for those aged up to 18, and a job or training place for 18 to 24-year-olds who have been out of work for six months

On Monday, along with my hon. Friend the Under-Secretary of State, I shall visit the Cynon Valley whisky-producing factory in Penderyn. I shall then attend a "topping-out" ceremony for the new Cynon Valley neighbourhood hospital, which is due to open in April 2011.

All that represents a Labour Government at Westminster, a Labour-led Government in Wales, and a Labour council in Rhondda Cynon Taf delivering real public service improvements.

2.37 pm

Mr. Stephen Crabb (Preseli Pembrokeshire) (Con): It is a pleasure to follow the right hon. Member for Cynon Valley (Ann Clwyd). She is a powerful voice for Cynon Valley, and also a persistent and tireless champion of the rights of women and other oppressed groups living under authoritarian Governments and dictators in different parts of the world. She has won my respect and admiration for both those aspects of her work.

So far, this St David's day debate has largely followed the pattern of previous such debates, and, indeed, our debates in the Welsh Grand Committee. The Secretary of State always leads with a highly combative and partisan speech, engaging in heavy historical revisionism and distorting the Opposition parties' track records and policies. Members of his party then take up the theme, and usually end up looking back to the 1980s and 1990s and comparing the record of previous Conservative Governments with what they consider to be that of the current Government.

I would caution against that, and I intend to use the next few minutes to inject some corrective content into the discussion. First, however, I wish to join other hon. Members in paying tribute to all the Welsh servicemen and servicewomen who are serving in Afghanistan. During the recent recess, my constituents learned that Lance Sergeant David Greenhalgh, of north Pembrokeshire, had been the latest Welsh soldier to be killed in action in Afghanistan. He was killed on Saturday 13 February in Lashkar Gah, aged 25. He was an outstanding young man, and he will be remembered with the deepest
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honour and respect. I think all hon. Members will agree that the young Welsh men and women out there represent some of the finest role models for all Welsh people at this time.

The context and backdrop for this year's St. David's day debate is, of course, the crisis in our public finances. I should emphasise the word "crisis" because nothing the Secretary of State had to say on the matter got close to recognising honestly the challenge this country is facing, with the disaster that has been visited on our fiscal affairs and the state of the public finances. The projected deficit is a truly enormous £178 billion. That is an unprecedented sum: the country has not had a deficit like it before. Frankly, for the Secretary of State to try to reassure us that somehow under a Labour Government it can be halved or eliminated within four years, without giving any real idea of how they will do that, does not cut it. The truth is that within two years the interest we will be paying on our national debt will be approaching £60 billion a year, which is more than the Ministry of Defence and education budgets combined. We will be spending more on servicing our debt than on educating our children and young people, and on defending our borders.

Mrs. Gillan: I wonder whether my hon. Friend has had an opportunity yet to read the text of the excellent lecture given last night by the shadow Chancellor, my hon. Friend the Member for Tatton (Mr. Osborne). It contained some fairly grim analysis, including the fact that if the off-balance-sheet liabilities such as public sector pensions are included, we are well on the way to having a level of debt amounting to more than 90 per cent. of GDP, and that the interest payments on that debt could rise above 10 per cent. of GDP within 10 years, and to almost 30 per cent. in 30 years. Does my hon. Friend the Member for Preseli Pembrokeshire (Mr. Crabb) agree that those predictions-which are made by some very eminent people who understand economics possibly better than we do-are alarming?

Mr. Crabb: I am very alarmed at those statistics; in fact, I find them horrifying. The true state of the public finances is appalling. Who will pay for this? Frankly, it will not be our generation; instead, it will be the nation's young people, and the children after them. Indeed, I think that one reason why there has been such a tone of complacency about our public finances this afternoon is that it is not the generations represented in this Chamber today who will end up picking up the bill.

Young people are among the biggest victims of the current recession. We need only consider the increase in youth unemployment in the past two years to realise that. They are victims of this recession not only because of unemployment, however; they are victims of an unsustainable and irresponsible increase in public spending that has brought us to this position, because the truth is that, contrary to what the Secretary of State tried to make us believe, the massive deficit we are facing is not just a result of the banking crisis. There was a large, growing and unsustainable structural deficit in the public finances even before the bank bail-out, and that did not get addressed. Young people will end up paying for this.

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