The
Committee consisted of the following
Members:
Chairs:
Mr
Graham Brady
,
†Jim
Sheridan
†
Bebb,
Guto (Aberconwy)
(Con)
†
Brennan,
Kevin (Cardiff West)
(Lab)
†
Bryant,
Chris (Rhondda)
(Lab)
†
Cairns,
Alun (Vale of Glamorgan)
(Con)
Caton,
Martin (Gower) (Lab)
†
Clwyd,
Ann (Cynon Valley)
(Lab)
†
Crabb,
Stephen (Preseli Pembrokeshire)
(Con)
†
David,
Mr Wayne (Caerphilly)
(Lab)
†
Davies,
David T. C. (Monmouth)
(Con)
†
Davies,
Geraint (Swansea West)
(Lab/Co-op)
†
Davies,
Glyn (Montgomeryshire)
(Con)
†
Edwards,
Jonathan (Carmarthen East and Dinefwr)
(PC)
†
Evans,
Chris (Islwyn)
(Lab/Co-op)
†
Evans,
Jonathan (Cardiff North)
(Con)
Flynn,
Paul (Newport West)
(Lab)
†
Francis,
Dr Hywel (Aberavon)
(Lab)
Griffith,
Nia (Llanelli) (Lab)
†
Hain,
Mr Peter (Neath)
(Lab)
†
Hanson,
Mr David (Delyn)
(Lab)
Hart,
Simon (Carmarthen West and South Pembrokeshire)
(Con)
Havard,
Mr Dai (Merthyr Tydfil and Rhymney)
(Lab)
Irranca-Davies,
Huw (Ogmore)
(Lab)
James,
Mrs Siân C. (Swansea East)
(Lab)
†
Jones,
Mr David (Parliamentary Under-Secretary of State for
Wales)
†
Jones,
Susan Elan (Clwyd South)
(Lab)
†
Llwyd,
Mr Elfyn (Dwyfor Meirionnydd)
(PC)
†
Lucas,
Ian (Wrexham) (Lab)
†
Michael,
Alun (Cardiff South and Penarth)
(Lab/Co-op)
Moon,
Mrs Madeleine (Bridgend)
(Lab)
†
Morden,
Jessica (Newport East)
(Lab)
†
Murphy,
Paul (Torfaen) (Lab)
†
Owen,
Albert (Ynys Môn)
(Lab)
†
Ruane,
Chris (Vale of Clwyd)
(Lab)
†
Smith,
Nick (Blaenau Gwent)
(Lab)
†
Smith,
Owen (Pontypridd)
(Lab)
†
Tami,
Mark (Alyn and Deeside)
(Lab)
Williams,
Hywel (Arfon) (PC)
†
Williams,
Mr Mark (Ceredigion)
(LD)
†
Williams,
Roger (Brecon and Radnorshire)
(LD)
Willott,
Jenny (Cardiff Central)
(LD)
Alan Sandall, Eliot Wilson,
Committee Clerks
† attended
the Committee
The following also
attended, pursuant to Standing Order No.
102(4):
Gillan,
Mrs Cheryl (Secretary of State for
Wales)
Newmark,
Mr Brooks (Lord Commissioner of Her Majesty's
Treasury)
Welsh
Grand
Committee
Wednesday
30 June
2010
(Afternoon)
[Jim
Sheridan
in the
Chair]
Legislative
Programme and Budget Statement
(Wales)
2
pm
Question
again
proposed,
That
the Committee has considered the Matter of the Government’s
legislative programme as outlined in the Queen’s Speech and the
Budget Statement as they relate to
Wales.
The
Chair:
Before I call Mr Llwyd, I wish to say that at least
15 people have indicated that they wish to speak, so brevity would be
helpful and would show some respect for your fellow
colleagues.
The
Secretary of State for Wales (Mrs Cheryl Gillan):
On a
point of order, Mr Sheridan. As this is our first Welsh Grand
Committee, may I use this point of order formally to welcome you to the
Chair? Your colleague chaired this morning’s lively session and
I am sure that this afternoon will be equally lively. I wish you well
in the Chair, and we are proud to have you presiding over our
proceedings.
Mr
Elfyn Llwyd (Dwyfor Meirionnydd) (PC):
I agree with what
has just been said. I hope that you have a convivial and rewarding
afternoon, Mr Sheridan, which I am sure is likely in the Welsh Grand
Committee.
With
regard to the Parliamentary Reform Bill, I will not go over what has
been said already about the equalisation of constituencies. Suffice it
to say that the constituency I have the honour of representing, Dwyfor
Meirionnydd, is 100 miles from north to south and about 95 east to
west, so heaven knows what will happen if it is equalised with
anything. It has a sparse population and therefore great care has to be
taken in dealing with it, otherwise there will be the accusation of
gerrymandering. I know that nobody wants to start down that path now,
but it will be a very difficult job, so let us hope that we can
exercise the highest form of
care.
We
are very much in favour of a lobbyists’ register, which is
common in European Parliaments, and I understand there is also far more
transparency on the issue in the Welsh Assembly. I hope that the gist
of the Elected Representatives (Prohibition of Deception) Bill, which
was introduced by a member of my party and has received the support of
the Liberal Democrats, might be included
too.
A
major issue for Wales is the commitment to a referendum, which we
understand from the Secretary of State will be in spring 2011. There is
little doubt that the legislative competence order process, even when
it works comparatively well, is bureaucratic and time consuming, taking
27 different processes to create Welsh legislation. That really cannot
continue.
Alun
Michael (Cardiff South and Penarth) (Lab/Co-op):
Does the
hon. Gentleman accept though, that over the past year or two, 14
transfers of powers to the Welsh Assembly have been carried out
expeditiously and efficiently due to the cross-party co-operation that
we have enjoyed on the Welsh Affairs
Committee?
Mr
Llwyd:
I hear what the right hon. Gentleman says and I am
sure that he is right in that regard, but my point is that we would all
like a simplified
procedure.
The
Holtham commission, which is very important to us in Wales, reported
last year. In the Liberal Democrats’ Welsh manifesto, their
Welsh leader called on UK Ministers to “act immediately”
on the commission’s findings. The lady concerned, Kirsty
Williams,
said:
“We
have long argued that the Barnett formula is not fit for purpose and
needs to be replaced with a fairer
system.”
It
is now time to get that work done and move forward. I understand that
there will be a commission and I am a bit disappointed about that; I
hope it is not kicking the ball into the long grass. I hope against
hope that something will be done fairly
shortly.
Alun
Cairns (Vale of Glamorgan) (Con):
Does the hon. Gentleman
not recognise that there has been a significant shift in the Government
position from that of the Administration before the election? The
previous Chancellor of the Exchequer said that he thought that
Barnett was fit for purpose and he was committed to maintaining it,
whereas this Administration have recognised that the funding
for Wales is insufficient and the issue needs to be resolved when the
commission has considered
it.
Mr
Llwyd:
Yes, I hear what the hon. Gentleman says, which
makes it even more perplexing that when introducing the 25% cuts across
all Departments the Chancellor did not take that into account in Wales.
Therefore, by definition, Wales was hit
hardest—[
Interruption.
] Yes, of course, it
is. It has to be. The logic of the argument is absolutely
unimpeachable, and some allowance should have been made for that.
However, there is recognition of it now, so we need to build on that
and get something
done.
As
we know, it is estimated that convergence will cost Wales about
£300 million a year. At the least, there should be a Barnett
floor to prevent that from happening, something described by the
Holtham report as an interim measure before fuller reform of the
formula. We and others across the board want to look at a needs-based
formula, something that I am sure will be ongoing. It has been referred
to so many times in this Committee that I shall not dwell on it now.
There is a contrast between enacting the Calman commission
recommendations and where we are with regard to this commission, but I
shall take things in good faith and hope that we can move forward
expeditiously.
As
for the police reform Bill, I am not at all impressed by the idea of
elected police chiefs. I am concerned that, in some way, the process
would become politicised. We all know that policing is by consent, and
that consent will break down if it becomes politicised. I hope
therefore that such points will be discussed. There is a danger of
going down the politicisation road and one thing that we can say about
the police service is that it is not
politically motivated, despite the incidents when the miners were on
strike. We will not go there now, but we know that the police service
is respected as non-political, and we must at all costs keep that
position in the interests of preserving the all-important issue of
policing by
consent.
Geraint
Davies (Swansea West) (Lab/Co-op):
Does the hon. Gentleman
accept that in many areas, police chiefs are meeting AMs, MPs and
councillors? Indeed, I regularly meet Superintendent Mark Mathias in
Swansea. The demographic mandate that police chiefs already engage in
is very wide, and there is a real danger that if they were elected,
they could be interfacing with only 10% or 20% of the electorate,
ignoring other democratic representatives and thrust into office on a
platform of popularity because of the problems of antisocial behaviour,
but not paying attention to counter-terrorism or the other important
behind the scenes
priorities.
Mr
Llwyd:
That is an obvious example of what can go wrong
when politics becomes mixed up with policing. We can think of American
examples and there is the question of priorities, as the hon. Member
for Swansea West rightly said. I sincerely hope that the Government
will pause and think about the way forward, and ensure that we do not
go down that road in the interests of us
all.
We
can build on the green agenda put forward by the Government, and it
would be useful to do so. As for high-speed railways, unfortunately we
are not likely to have electrification of the line from the border
across Wales. When things improve in the medium term, I hope that we
shall have electrification of the south Wales main line as well as the
line in north Wales. It is absolutely bizarre in this day and age that
a country does not have some electrified lines, which unfortunately is
the position in
Wales.
Mr
Peter Hain (Neath) (Lab):
I support what the hon.
Gentleman is saying. Does he agree that the Paddington to Swansea
high-speed electrification line is precisely the sort of infrastructure
project that will create jobs and promote growth for the future, and
should still be included in the Government’s
programme?
Mr
Llwyd:
That is no doubt true. Indeed, not so long ago I
heard that some Korean entrepreneurs were on their way to the old
county of Clwyd with a view to setting up a business. Their train broke
down at Chester, and they had to go home again. That is the norm
nowadays. The right hon. Gentleman is absolutely right. We must get the
infrastructure correct and we must press for equal treatment of our
transport system because it is vital to aid recovery, which we all want
to
see.
On
the balance between cuts and tax rises, I am concerned about the likely
effect of cuts to the welfare budget. I preface that by saying that
although there may be people who should not have welfare payments, I
have dealt with about 200 disability living allowances appeals since I
became a Member of Parliament and failed in only five—I would
have pursued none of them if I knew people were swinging the lead. That
was not because I am a brilliant advocate, although hopefully some
might
think that—my wife might, but no one else—but because the
claims should not have been refused in the first
place.
I
mentioned a case earlier, in passing, of a young woman who is
desperately ill; her kidneys are failing and unless she has a
transplant in the next 18 months I am not sure what will become of her.
She has to dialyse four times per day, but the doctor who saw her said
that she can walk 100 metres without any problem, which is an absolute
lie, and that she can walk up stairs without any problem, which is also
an absolute lie. Even though she was on dialysis, she was failed in the
first instance. There is something wrong with such a system. We have to
purge that kind of practice. I am prepared to do the appeals, but what
about the worry that people go through? That appeal went in last summer
but was heard in Aberystwyth only on Monday. I am not happy with the
current process, let alone with what might be
coming.
Mrs
Gillan:
I heard what the hon. Gentleman said earlier about
that case and it worries me deeply. If he feels that my office can
afford any service to him and his constituent in making a case, I would
be delighted to help. I have regular meetings with the First Minister
and would be delighted to make the services of my office available, if
he feels it
appropriate.
Mr
Llwyd:
I am grateful to the right hon. Lady and I may well
take up that offer. One of our problems is with the forms, which are
not user-friendly—people filling them in do not have the room to
elaborate on their condition. It is a tick-box system, which is clearly
inappropriate, and I am sorry to say that many of the medical examiners
are compromised—they pick up the £135 as a little extra
pin money for going through the process with people, and it is over in
half an hour. I mentioned the issue on the Floor of the House, and I
was waiting for a barrage of letters from GPs, but had only two phone
calls, one from Swansea and one from my own constituency, saying,
“We agree with what you say, it is a flawed
system.”
I
am concerned because some whispers going around are that the medic will
be the final arbiter. That can never be right. I hope that common sense
prevails and that we adopt a different set of criteria to determine
whether people are worthy of DLA. As I said earlier, I would not
undertake any cases that I knew to be false, because that is a waste of
everyone’s time and effort, but it remains one of the ironies of
our society that we seem to spend more time on perceived benefits
cheats than we do on cracking down on tax evasion and
avoidance.
Guto
Bebb (Aberconwy) (Con):
Obviously I accept fully the point
the hon. Gentleman has just made about the system being fair to
everyone—no one would want to see the constituent in question
suffering as he described. However, when we look at the figures for the
Budget as laid out in the Red Book, we are currently aiming to spend
£194 billion of social protection this year, with income tax
receipts of £150 billion. Does the hon. Gentleman think that is
sustainable?
Mr
Llwyd:
Clearly it is not sustainable. As I said in
prefacing my remarks, there will be some examples of waste—I do
not deny that. What I am trying to say is
that in my 19 years in this place, I have come across very few people
who are in receipt of benefits but should not be. I say that in all
honesty. I am not making a political point, but telling it straight: I
have come across very few, so let us be careful about how we proceed.
If there is waste to be cut and if there are people who are being
wrongfully paid, fine, let us deal with that, but let us not in any way
take a general view about such people; for example, that everyone on
DLA should not be on it. That, clearly, would be the wrong premise on
which to
start.
Ironically,
we should give higher funding to Her Majesty’s Revenue and
Customs, to look at tax evasion and avoidance. A recent TUC report
estimated that £3 is lost for every £1 saved in
efficiencies. We will need to look at the whole issue of tax havens and
so on. We should be serious about looking at financial deficits, as the
hon. Gentleman said—I agree—but we must also be serious
about UK taxes being paid at the higher rate and more
regularly.
Time
is pressing so I shall move on quickly to the whole issue of bilingual
juries, which I have been concerned about for a long time. I am
disappointed that the response earlier this week noted that there were
not enough Welsh speakers—the worst response I have heard in my
life. I hope that at some point there will be a consensus across the
board on the issue, and I am sure there will be. It does not cut across
random selection; there are enough Welsh speakers, even in places
considered anglicised—where there are often more Welsh
speakers—and we need to address
that.
The
call for bilingual juries has always been supported by the Liberal
Democrats, who, as we all know, are all things to all men—and
women, of course. Members who have had a classical education will know
about Janus and that in Roman times he was depicted as having two faces
or heads facing in opposite directions. Apparently, he was the god of
gates, doors, doorways, beginnings and endings—there being no
god of actually sitting on the fence. However, that is an appropriate
description of where the Liberal Democrats currently sit or stand,
depending on the day of the
week.
I
will give a few examples. On Trident, the student vote was garnered by
saying, “We are against Trident.” Yes, they were, but the
Liberal Democrats were also in favour of another form of weapon of mass
destruction—on a smaller platform—or so we understand
from their party’s spokesman on the Astute class submarine. That
is a clever move. If we launch a Trident missile from an Astute class
submarine, one of the unfortunate side-effects is sinking the
submarine, so I am not sure how detailed their thinking is on that. I
wish they had finished the sentence with, “We are against
Trident but we are still in favour of nuclear weaponry”, because
that would have been the honest position. They were garnering votes and
carrying them in thousands from the colleges in Aberystwyth, Cardiff
Central and everywhere else. It really is not good
enough.
Mr
Mark Williams (Ceredigion) (LD):
I was not aware that the
hon. Gentleman was at the public meetings that we held in Aberystwyth
with the student communities and others. Perhaps his friends were. He
came to Ceredigion on one occasion to a shabbily attended meeting in
Aberystwyth, but I do not think Trident was an issue. My opposition to
Trident was on the basis of cost. That was articulated at every
meeting, and the hon. Gentleman will find that it had the overwhelming
support of the Ceredigion electorate in the general election. I argued
against the cost issue, which is still to be considered by the
coalition
Government.
Mr
Llwyd:
Well, the hon. Gentleman’s party spokesman
said, “We are in favour of
nuclear.”
Mr
Williams
indicated
dissent.
Mr
Llwyd:
The hon. Gentleman has made his point. We
understand he will be a rebel in this Parliament, and that is one way
for him to move forward. We have heard what he has to
say.
On
capital gains tax, the Liberal Democrat idea was a good one and I fully
supported it, but it did not come through. It was not the 40% or 50%
that they wanted; it was 28%. The Lib Dem policy that a £10,000
income should be tax-free was compromised. On value added tax, we had
the wonderful performance of his hon. Friend the Member for Brecon and
Radnorshire, who one day said, “I am against it; I will vote
against it; I will do this, that and the next thing.” But within
a matter of hours, he voted in favour. That is pretty sad. As I have
said, the Lib Dems are all things to all men and they are capable of
the most fantastic U-turns when they put their minds to
it.
Mr
Williams:
I consider the hon. Gentleman a friend;
we share a border in our constituencies. Is he honestly saying that
every single issue on which Plaid Cymru fought the previous Assembly
elections has manifested itself in Assembly Government policy? Is he
honestly saying that there are not issues that he is disappointed have
not been achieved by Plaid Cymru in government that it campaigned for
in the election?
Mr
Llwyd:
Of course the Lib Dems cannot enforce the whole
manifesto or indeed have it accepted, but—for heaven’s
sake—when they stand up to the electorate and say, “There
will be a Tory bombshell of a VAT rise,” they spend hundreds of
thousands of pounds doing it, and then turn around weeks later and say,
“We will vote for it”, it is not good politics, my
friend.
Alun
Cairns:
If the hon. Gentleman is looking for consistency
in policy, can he tell me how he squares the nuclear energy policy of
Plaid Cymru’s leader, Ieuan Wyn Jones, with the party’s
policy, which is opposed? We are in favour in Anglesey, opposed as a
party, but the leader is allowed to run on both sides of the
fence.
Mr
Llwyd:
That question comes up at virtually every Welsh
Grand Committee, and the answer is the same. Of course the Welsh
Conservatives are consistent on everything, are they? I see. There we
are.
I will
conclude because time is pressing. I believe that the Liberal Democrats
will be punished for what they have just done next summer and at the
next Westminster election. The best classical comparison may not be
Janus but Icarus: flying too close to the heat and
dying.
2.20
pm
Paul
Murphy (Torfaen) (Lab):
I welcome the Secretary of State
and the Under-Secretary, whom I wish well in
office.
This
morning was a bad start for the Committee in this Parliament. When the
Secretary of State was my shadow and the shadow of my right hon. Friend
the Member for Neath, we always discussed the issue of ministerial
statements together to arrange proper time for the Committee to deal
with the issues before us. We did not have that this morning. We had an
exceedingly unexciting statement from the Chief Secretary, who gabbled
his way through it probably because he wanted to get out of the room as
quickly as possible. It did not add anything to the debate that we are
having now or the debate we could have had if things had been done
properly. I hope that we will see a better way of dealing with the
Committee’s business in the months
ahead.
This
morning’s events show what this Tory Government with Liberal
Democrat support, propose to do on the constitution, parliamentary
procedures and how we govern ourselves. This morning’s example
was classic: riding roughshod over convention, the Opposition and the
sensible policies that have been adopted over the years regarding our
constitution. For example, we were told in the Queen’s Speech
that we will have a constitutional or a political reform Bill on which
the Deputy Prime Minister will lead. That will not deal—although
we are told that the issue will be before us—with the stuffing
and packing of the House of Lords with people from the Conservative and
the Liberal Democrat parties to, again, ride roughshod over the
democratic processes in the other
place.
This
morning I spoke briefly about the 1832 Reform Act. Those who know the
history—I was taught by the great author of “The Great
Reform Act”, Michael Brock—know how the then weak Liberal
Government had wanted to pack and stuff the House of Lords to get the
1832 Act through. We are now in different circumstances, but the
methods are exactly the same. The Committee will know that for 13 years
the Labour Government had no majority in the House of Lords. They could
have stuffed and packed it with peers from the Labour party, but they
did not do so. The other thing that the Government are doing—it
will also be part of the Bill—is to change the procedures for a
vote of confidence in the House of Commons. I have no doubt that there
is universal opposition to that outside the House by those who know
about such
matters.
I
want to the concentrate on the part of the Bill that will directly
affect Wales, and that is the changes to our parliamentary
constituencies. The logic on which that daft policy is based is that it
is a popular thing to do. Well, it is a populist thing to do, which is
not quite the same. I have not come across, in my constituency or
elsewhere during the election campaign, any reference whatsoever to the
need to reduce the membership of this House to satisfy the populist
ambitions of the Conservative and Liberal Democrat parties. I said this
morning that in 1832 there were 32 Welsh Members of this House when
Wales had a population of less than 1 million. We now have 3 million
people with 40 MPs, which is an increase of eight seats. However, if
you look at the country as a whole, there has been a 3% increase in the
number of House of Commons seats since 1950, but a 25% increase in the
size of the electorate of Great
Britain and Northern Ireland over the same period. There is no evidence
whatsoever of any outside opinion that wants the reform, except within
the Conservative and Liberal parties, or of any logic behind the
claim.
Jonathan
Evans (Cardiff North) (Con):
Is the right hon. Gentleman
saying that the current disparity between Wales and the rest of the UK
should be maintained? Or is he arguing that we should have more Members
of Parliament from England and a House that is significantly
larger?
Paul
Murphy:
It is certainly not for a Welsh Grand Committee to
argue for less representation for Wales. It is not for Welsh Members of
Parliament to argue for less representation for Wales. We should be
arguing for proper representation for Wales, which we have had over
decades and centuries.
Another issue
that affects all that is the lack of consultation and negotiation with
our colleagues in the Welsh Assembly Government on the implications of
the Government’s policies. The Government have been in office
for only a matter of weeks and in those weeks they have, on a number of
occasions, ignored the proper consultation process between the
Government and the Welsh Assembly Government. The Secretary of State
for Work and Pensions talked about the “on your bike”
policy for council houses, forgetting that the issue of council housing
is devolved in Wales. He should have talked to either the First
Minister, or the relevant Welsh Assembly Minister. The Secretary of
State should talk to the First Minister not only about the implications
of the appalling Budget on the people of Wales, but the implications
for Wales of the so-called parliamentary reform
Bill.
Mrs
Gillan:
I assure the right hon. Gentleman that there has
been a great deal of contact with the Welsh Assembly Government. I am
meeting the First Minister yet again on Monday. I am also meeting the
Cabinet of the Welsh Assembly Government. I asked whether it was
suitable for the First Minister to allow me to have that meeting. Jane
Hutt, the Minister for Business and Budget in the Welsh Assembly
Government, has already met the Chief Secretary to the Treasury. The
Prime Minister, of course, chaired the Joint Ministerial Committee and
the Foreign Secretary chaired the Joint Ministerial Committee on
Europe.
The right
hon. Gentleman will find that there has been a great deal of effort
from the Government to engage in a mature fashion so that we can move
forward constructively on matters that are of interest to Wales.
However, if the right hon. Gentleman has any more suggestions about the
frequency with which we should meet, I would be very willing to look at
those representations. I think that he will find that the amount of
contact that we have had in just a few weeks is almost
unprecedented.
Paul
Murphy:
It is all very well having meetings, but if
nothing comes of them what is the point? It is likely that there will
be a 25% reduction in the public budget for Wales in the coming months.
We can have meetings till our heads fall off, but if a quarter of the
public budget in Wales is cut, the implications for jobs and the people
of Wales are enormous.
On the issue
of constituencies, the Secretary of State should be meeting constantly
with the First Minister and the Cabinet. She will know, as we said this
morning, that if the proposed reduction in the number of Welsh
seats—probably to 30—goes ahead, the implications for the
Welsh Assembly are enormous. You will know, Mr Sheridan, from
your Scottish experience, about the complications involved in that. The
Welsh Assembly simply cannot function with 45 Members. It will not have
sufficient Members to deal with scrutiny or the other business of the
Welsh
Assembly.
As
the hon. Member for Dwyfor Meirionnydd just mentioned, the Government
proposals for shaping and re-shaping the parliamentary constituencies
have a particular resonance in Wales. In our valleys in the south we
cannot play about with constituency boundaries too much—a valley
is a valley. All our communications are north to south and south to
north—not east to west. Messing about with that will lead to the
most artificial concoctions of constituencies—far too big and
unmanageable without any link between MP and constituency.
Conservatives have always said that they do not agree with proportional
representation because it takes away the link between an MP and his or
her constituency. Keeping too rigidly to 75,000 or 78,000 electors
would destroy at a stroke in Wales the basis of the community nature of
our constituencies. The hon. Member for Brecon and Radnorshire is not
here, but if the proposals go through, he will not have a constituency.
Montgomeryshire will go. If Brecon and Radnorshire is added to it, the
constituency would start at Crickhowell and end up in
Wrexham—the size of Paris and with 100,00 people. Those are the
sort of daft creations that will result from the parliamentary reform
Bill. They ought to drop it. We will fight it all the way—in
this Committee, in the House of Commons, in the Lords and
outside—because the parliamentary proposals were not agreed by
the people of Wales. It will destroy the relationship between the
Assembly and Parliament. It will reduce the proper representation of
Welsh people here in the House of Commons and, fundamentally, it is the
wrong thing to
do.
2.29
pm
David
T. C. Davies (Monmouth) (Con):
It is clear that the thrust
of today’s speeches—notwithstanding the previous one,
which was interesting—is the cuts in the budget for Wales and
the cuts in services that that are likely to follow. I get a sense of
déjà vu whenever I hear the shadow Welsh Secretary speak,
because he frequently regurgitates his speeches, changing them only
slightly to suit the proceedings. I am also reminded of Harold Wilson,
who famously told a Labour party conference in the late 1970s that,
although they used to think that it was possible to tax and spend their
way out of a recession, that option no longer
existed.
Albert
Owen (Ynys Môn) (Lab):
It was
Callaghan.
David
T. C. Davies:
Perhaps it was Callaghan, but that was a
fair summary of what was said. In fact, Callaghan and Wilson pioneered
the Conservative party’s monetarist policies of the 1980s, and
the Labour party cleverly ensured that we took the blame for them
before
trying to take the credit for all the things that it kept in subsequent
years. I see the same thing happening now. It was the right hon. Member
for Edinburgh South West (Mr Darling) who pointed out that we had to
make drastic spending cuts. He wants a 20% cut to halve the deficit,
but we want a 25% cut to get rid of the deficit in five years—I
am no economist, but that sounds like a better deal to me. It will, of
course, cause pain, but it would have caused pain whoever was running
the country and whoever was running Wales. Nobody celebrates public
funding
cuts.
If
nothing else, the situation shows that the Welsh Affairs Committee will
have an important role to play over the next few years. I am honoured
and delighted to have been appointed Chairman of that Committee, and
pay tribute to the previous Chairman, the hon. Member for Aberavon, who
did an excellent job. He understood, as I do, the importance of seeking
consensus if any of that Committee’s reports are to have any
effect. I admit that seeking consensus has not been one of my strong
points over the past 11 years in Parliament and the Welsh
Assembly—I am on a learning
curve.
Dr
Hywel Francis (Aberavon) (Lab):
I thank the hon. Gentleman
for his praise and congratulate him on his election to the Chair of the
Welsh Affairs Committee. I note his observation, both now and
previously, about the need to be objective and impartial. However, it
is also the task of the Welsh Affairs Committee to be the voice of the
Welsh people in Parliament. One 19th-century Welsh newspaper was called
“Tarian y Gweithwyr”—the shield of the workers;
will the hon. Gentleman be “tarian y werin” and ensure
that the Welsh Affairs Committee will be the shield of the Welsh people
and protect them against the austerity
Budget?
David
T. C. Davies:
I shall be “tarian y
gweithwyr”, but “tarian y cwmnïau
hefyd”—the shield of companies also—because it is
important to remember the employers. If we did not have employers, we
would not have employees. I will try to remember what the hon.
Gentleman said, but I will also remember that if we do not make these
cuts, we will be in a perilous situation. A business supplement
headline in The Sunday Times a few months ago read,
“Britain will not be downgraded—yet”. That
“yet” was the killer word, because only a few months ago,
a national newspaper was discussing the fact that Britain was not about
to be downgraded just at that
moment.
Mr
Wayne David (Caerphilly) (Lab):
Will the hon. Gentleman
give
way?
David
T. C. Davies:
I will in a moment, but let me make my point
first. If our triple A rating had been downgraded, it would have been
virtually impossible for us to borrow any of the £150 billion a
year that we need to square the books. That would have put workers and
companies in a very perilous situation
indeed.
Mr
David:
Does the hon. Gentleman believe The Sunday Times
to be an impartial and objective
newspaper?
David
T. C. Davies:
One thing I have learnt over the past year
is that there is no such thing as an impartial and objective newspaper.
I believe, however, that had
Britain not taken drastic action, we would have suffered a downgrade in
our rating status. Opposition Members would probably agree with
that.
Geraint
Davies:
Does the hon. Gentleman accept that one way to
reduce the deficit may be to relocate some Whitehall Departments from
London to Wales? Does he also accept that, if the number of Welsh MPs
is reduced from 40 to 30, our negotiating leverage to achieve that and
to get a decent grant for the Welsh Assembly will be
reduced?
David
T. C. Davies:
I accept the first part of the hon.
Gentleman’s statement, but I do not necessarily accept the
second, because Members of Parliament have a wider national role. It
should not simply be to say, “Come to my constituency because a
number of us have ganged together and think it’s a good
idea.” If we are serious about cutting the deficit, we need to
look, yes, at maybe moving people around if they are willing to do
that, but also at making sure it is cost efficient to do
so.
Mrs
Gillan:
I add my congratulations to my hon. Friend on
being elected to the Chair of the Welsh Affairs Select Committee. It
may interest him to know that I have already written to my Cabinet
colleagues to suggest that if any parts of their Departments need
relocating outside the expensive metropolis, Wales would be a very good
recipient of them. Perhaps through his good offices, he will know that
I have been a loud voice for Wales on that
point.
David
T. C. Davies:
I am grateful for that. I believe that the
hon. Member for Swansea West will be a member of the Committee, and
such a matter is the sort of thing it may well wish to examine. We may
not agree on the level of cuts that will take place—I am sure we
will not—but we can look at ways to mitigate the effect on
people, and we may be able to find agreement. For example, only
yesterday, I had an e-mail from a constituent who had cleverly put in a
freedom of information request and discovered that Gwent police had
spent £35,000 or so on putting out leaflets telling people
effectively what a good job they are doing. The leaflets were
newsletters and the sort of thing that Members of Parliament used to
put out—I plead guilty to that one as well. However, we have
been told that we can no longer do that because times are hard. We
might wish to ask whether the police authorities should be putting out
leaflets telling everyone what a good job they are doing when times are
hard, particularly as there are 43 police authorities across England
and
Wales.
Jonathan
Edwards (Carmarthen East and Dinefwr) (PC):
Is the hon.
Gentleman not concerned that overt fiscal consolidation based on
expenditure cuts will lead to a double-dip recession—if not at a
macro-level, definitely at a Welsh
level?
David
T. C. Davies:
It could do. I do not know because I am not
an economist. Lots of people are saying that such an approach will lead
to a double-dip recession, but I do not think many of them are
qualified to say that. Winston Churchill once said that if two
economists are put in a room and asked a question, you
will get three different opinions. The answer is that I do not know.
Some people have said that that will be the case, but many people have
said that if Britain loses its triple A rated status, we are almost
certain to go into a recession because we will not be able to borrow
any
money.
Everyone
talks about the deficit in terms of GDP. Again, I am not an economist;
I like to understand things in a simple way. If our tax revenue is
£520 billion a year but our spending is £670 billion a
year, that is a phenomenal hole that we have to fill. I am certain that
if we do not take action to stem the deficit, we will almost certainly
have the double-dip recession about which the hon. Gentleman is
concerned.
Susan
Elan Jones (Clwyd South) (Lab):
Does the hon. Gentleman
agree that if it is a “tarian” of anything, it is
“tarian y toriadau”—a shield of cuts? When he
speaks of economists having different views, the kind of people we are
talking about are, for example, the US Treasury
Secretary—Timothy Geithner—who expressed such a fear at
the weekend. Does he have any comment about the fact that the Business
Secretary confessed only last week that the Government’s whole
approach on the issue was “a
gamble?”
David
T. C. Davies:
We are going a long way from the remit of a
humble Chair of the Welsh Affairs Committee. The Chief Secretary was
here earlier; why am I getting all the financial questions? I do not
like the word “gamble” but, of course, we cannot be 100%
certain of the outcome of all this. We cannot be certain what the
outcome would have been if our credit rating had been downgraded, but
it would have been dire for all of us in Wales. I hope that I will be
“tarian y gweithwyr” and I am sorry that the Welsh word
for cut, “toriad”, is so similar to one of the more
pejorative terms for the word
“Conservative.”
Alun
Cairns:
Clearly, there are different views among many
different economists on the risk of a double-dip recession. However,
has not the new independent Office for Budget Responsibility concluded
that there are greater risks in not making those essential cuts? Its
director has recognised that there is a greater risk to the economy in
Wales and elsewhere if we do not make the cuts necessary to bring
public spending under
control.
David
T. C. Davies:
My hon. Friend is correct but, again, I am
veering a long way from where I wanted to be. Let me simply say this.
We all recognised the need to reduce public spending. There is no point
shying away from that. If there are to be cuts in public spending, we
could look at where they need to fall. For example, I was very sorry to
hear that Gwent theatre is to have its funding from the Arts Council of
Wales cut and may even be forced to close. I am sure that many people
will ask where else the Arts Council of Wales is spending money and
whether that cut is the most appropriate for it to
make.
I
have heard talk, although not in the House yet, about reducing the
number of people who go to prison. That would concern me because I do
not necessarily accept that reducing prison numbers will save costs,
nor do I accept the figures that have been bandied around in some
newspapers.
I know that
the referendum will be a big issue for the Committee and the Assembly.
There is no point in insulting each other’s intelligence: we all
know that there are big divisions. There are divisions within our own
parties and in Wales about it. It is not our job to widen those
divisions. The job of the Committee will be to try to look for
agreement on issues relating to the fairness of the referendum.
Whatever happens, that result will be a difficult one for people in
Wales to take if they are on the losing side.
I make no
secret of the fact that I am a Unionist. I opposed the creation of the
Welsh Assembly and there is no point in denying that I would vote
against further powers for it. I respect the views of Opposition
Members who say that strengthening the Welsh Assembly would strengthen
the Union, and of those who quite openly would prefer Wales to leave
the Union altogether—at least, that is my understanding of their
position. It is possible to respect that and I hope that the views of
people who genuinely fear that further powers for the Assembly could
lead to Wales losing its place in the Union will also be respected. All
I would seek is a referendum that is fair to all sides so that they can
get their arguments across. The question has to be fair to all sides.
Then, when the voice of the people of Wales is heard, all sides can
respect the answer, whatever it is. Surely that is good for all of
us.
Mr
David:
The hon. Gentleman said that he was against
additional powers for the Welsh Assembly. Can I take it that he will
adopt a somewhat different position from the Secretary of State for
Wales?
David
T. C. Davies:
My right hon. Friend said that she will
remain entirely neutral to ensure fairness. As the Chairman of the
Welsh Affairs Committee, I will remain neutral as well, but if I am
asked how I will vote —I will have a vote in
Wales—I will not hide the answer. I will not try to pretend that
the past 11 years have not happened. I will say quite honestly what my
view is and at the same time try to ensure fairness. I do not think
that those two things are
incompatible.
From
the perspective of 11 years in Parliament and the Assembly, I got some
things wrong about the Assembly. I sneered at the family-friendly hours
when they were set up. I thought it was a bit of shirker’s
charter. I am not sure whether I put it in those terms but I was
certainly dismissive. I look around here after five years and this
place is a breaker of families. We have all gone through the mill in
the past year. We could learn a lot from some of the Welsh
Assembly’s working practices and it behoves people like me who
have been negative about it to accept that and to admit that it got
some things right.
The whole
thing was set up from scratch in 1999. We are still running this place
like an 18th century London gentleman’s club, coming in at 2.30
in the afternoon and finishing at 10 or 11 o’clock at night. Why
do we have to do that? I do not know. Again, that is veering a long way
from Welsh affairs. Suffice it to say, the Welsh Assembly has got some
things right. It could learn from our Select Committee system, which,
from what I have
seen, works far better in Westminster than in the Welsh Assembly,
possibly because of the numbers of people
there.
One
of the roles of the Welsh Affairs Committee can be to offer
constructive criticism and solutions to the Welsh Assembly and the
Secretary of State for Wales, remembering at all times that, if we can
do it unanimously with opinions as diverse as mine and—I could
say those of my hon. Friend the Member for Montgomeryshire, but perhaps
I should look at Plaid Cymru Members, it is likely that those reports
will carry some weight. Many of us in the past year must have asked
ourselves what we are doing here when we get so much antipathy, hatred
and lack of understanding from the press and many in the outside world.
Yet we all won our seats. People wanted us to come here and represent
them. If it is not too trite and clichéd, although it probably
will sound it, I think we all know that we can make a difference in
ways big and small. The Welsh Assembly can play a role in making a
difference, and I hope that we can all work together to achieve
that.
Several
hon. Members
rose
—
The
Chair:
Order. I will make a point before I call the next
speaker, which is no reflection on her. At the beginning, we appealed
for brevity. If contributions and interventions continue to be as long
as they have been, there is no way that some people will be called,
which would be extremely
unfortunate.
2.45
pm
Susan
Elan Jones:
Thank you for calling me, Mr
Sheridan. I promise to be as brief as possible. There is a great
difference between delivering a speech in this forum and delivering a
maiden speech. When many new Members deliver their maiden
speeches—especially those of us who represent rural and
semi-rural Welsh constituencies—they take a tour of many of the
scenic aspects of the
seat.
The
scene that I describe today, however, is not of the picturesque aspects
of the seat. It is based on facts about Clwyd South, as it is now: the
fact that in March, long-term unemployment was more than 31% below what
it was in 1997; the fact that last December there were 8,400 families
and 13,000 children benefiting from tax credits; the fact that last
August there were 5,000 beneficiaries of pension credit; the fact that
in 2008-09, 11,740 households and more than 16,000 people living there
benefited from winter fuel payments; the fact that in the school year
of 2008-09, 53% of students in the county borough of Wrexham achieved
five or more GCSE grades A to C, which was up 12% from 1996-97, and
that the comparative figure for the county borough of Denbighshire was
up 11% for the same period; the fact that the number of pupils leaving
education without any qualifications has decreased form 3.1% in 2004-05
to 0.1% in 2008-09 in Wrexham county borough, and from 4% to 1% in
Denbighshire county borough; and the fact that there are now 226 more
police officers across north Wales than was the case in March
1997.
Those facts
do not make the pretty postcards that we associate with many parts of
our constituencies, but they show how 13 years of Labour Government in
the UK, and Labour-led Administrations in Cardiff, have
transformed the life chances of ordinary people. Those of us who live in
those communities know all too well that behind every statistic is a
person, and hearing their stories makes me more proud than any pat
statistic on Labour’s achievements in office.
On 27 April,
the leader of the Welsh Liberal Democrats, Kirsty Williams,
said:
“As
for the Conservative party, they recently admitted that they want to
slash spending immediately, which will have a damaging effect on the
Welsh economy given its strong reliance on the public
sector.”
Today,
a mere two months later, I believe that she was right. It is difficult
not to believe that what has driven the Conservative-Lib Dem Budget is
an ideological preference against state
investment.
My
former Conservative opponent in Clwyd South has a fondness for writing
letters to local newspapers—I believe that he should be greatly
encouraged to do so. Only last week he wrote about the kind of
investment that 13 years of Labour Government
delivered:
“As
the massive investment increases in, mostly wasted, spending on
education, health, welfare and public sector jobs starts to dry up, we
will see that there has been little improvement to show for
it.”
Perhaps
he should tell that to the 8,400 families who are benefiting from child
tax credits, the 5,000 pensioners in Clwyd South who are benefiting
from pension credit, the families that have seen hospital waiting lists
slashed or the children who have better educational
qualifications.
Recently,
a local newspaper in my area asked residents for their verdicts on the
Budget. It was abundantly clear that they still think that the VAT rise
is regressive, as did the hon. Member for Brecon and Radnorshire only
10 days ago. A mother mentioned the rise in the cost of
household goods, clothes for adults and some food items. A local taxi
driver, who brings in £250 a week, commented:
“We
cannot afford to put our fares up because we are really down on
turnover, it’s really bad. Our costs are going to go up with the
VAT, but we are going to have to absorb it even though we are
struggling.”
Save the Children
calculated that last week’s Budget is likely to cost the poorest
families in Wales about £1,600 a year. The manager of a local
credit union said:
“The
things which will have the biggest impact on people will be the cap on
public sector workers earning over £21,000 a year, the rise in
VAT from 17.5% to 20% and the change to a whole range of benefits. I
can foresee these things will mean that many more people will be coming
to us for loans to help balance their family budgets.”
Gwyn Evans, chairman of
the Federation of Small Businesses in north Wales, described the
increase in VAT to 20% as one that
“will hurt small
firms who have to pass the increase on to their
customers.”
Guto
Bebb:
Will the hon. Lady give
way?
Susan
Elan Jones:
I will not; I look forward to hearing the hon.
Gentleman’s speech
later.
In
conclusion, I hope that I have given a flavour of the way in which
previous investment has helped my constituency and of my fear that last
week’s widespread cuts may well harm the
area.
Several
hon. Members
rose
—
The
Chair:
I shall call the winding-up speakers at
3.40
pm.
2.51
pm
Jonathan
Evans
:
I visited the Table Office earlier in order
to take advice on this speech, because this is the first time that I
have made a speech in Parliament since returning to the House after an
absence of 13 years— 10 of those being spent on
missionary work in the European Parliament. I asked whether this counts
as a maiden speech, and I was generously told that my maiden speech
took place 18 years ago. That is not an invitation to intervene, but it
does set the context, which is that I will reflect the tone of such
speeches by first paying tribute to my predecessor, Julie Morgan. There
is nowhere better to do so than in this Committee, not least because as
I look across the Committee, I see so many people who worked so hard to
try to ensure that I did not return to the House.
[
Interruption.
] The result was indeed very close,
which was a strong reflection of the high regard in which Julie Morgan
was held in the constituency—she was well regarded here in the
House, too. It was a testament to her personal service in the
constituency that she secured only 40 fewer votes than in
2005.
Having said
that, I am delighted to be here, because I feel that I have arrived at
a rather historic time, in which we are living new constitutional
history. In that context, I remind the Committee of the remarks made by
Mervyn King during the election campaign, which were not announced
publicly but which were subsequently leaked. He said that the party
that won the election would be out of office for a generation. I do not
know whether that will prove to be true, but we would do well, in the
context of this debate, to reflect on those words. Why did he say that?
He said that because he recognised the enormity of the financial
challenges that faced our country. In the time that I have been back in
the House, I have not received the impression that that is totally
appreciated by Opposition Members, so I will remind the Committee of a
few facts.
We already
know that the budget deficit is £153 billion
—it is endlessly discussed—but we do not speak so much
about the level of personal debt that was racked up over the course of
the Labour Government. The hon. Member for Clwyd South discussed the
advances that she feels that her constituents have experienced; the
reality is that her constituents, along with my constituents and those
of all Committee members, are more heavily indebted personally than
they have ever been. Personal debt is equal to 100% of GDP, and savings
are at their lowest level since the 1950s. That is a stark picture, not
only in the personal finance sector but in the company finance sector,
because although personal debt represents 100% of GDP, company debt
makes up
110%.
Sure,
we had all those years in which the right hon. Member for Kirkcaldy and
Cowdenbeath (Mr Brown) and Tony Blair were cutting the ribbon of Lehman
Brothers and the rest in the City of London and getting the resources
from that growth in the financial sector, but the reality during that
period was that many of those companies were themselves existing on
significant debt. I repeat: the amount of company debt in our country
represents 110% of GDP.
When the
tsunami of the financial crisis hit us, it was claimed that our country
was best placed to withstand the recession. That was not true. It was
the worst placed, and if anybody doubts that, a McKinsey report
published in January described our country as the most indebted in the
world. That is the stark message.
I was
surprised when, within a day of the election, having come so near to an
overall majority, my right hon. Friend the Member for Witney (Mr
Cameron) gave a speech offering the opportunity of a real, open
coalition with another political party. I thought subsequently that
that was a brave move on his part, because it was not universally
popular on my side of the House. Going into coalition was a big
challenge not only for our party, but for our Liberal Democrat
colleagues, given the slings, arrows and insults that they have
received. That is, however, a recognition of the enormity of the
problems that we have been left and that have to be grappled
with.
During the
election campaign, Labour recognised that those challenges had to be
faced and that £40 billion had to be cut from the
Budget, but watching Prime Minister’s questions or other
debates, or what took place earlier in this Committee, that would be
hard to believe. I have not heard any specific proposal on reductions
in Government spending that has been accepted by Labour Members. That
is a matter for the Opposition, but the reality is that it falls to us
to try to address the challenges that we
face.
Geraint
Davies
:
During the election campaign, the
Conservative party suggested that there should be £8 in cuts for
every £1 of tax raised, while the Liberal Democrats suggested
that there should be £2.50 in cuts for every £1 of tax
raised. Does the hon. Gentleman accept that there is not an equal
coalition and that it is an overwhelmingly Conservative mandate? Does
he also accept that one can balance economic growth, tax, and cuts as
part of a portfolio to solve the
deficit?
Jonathan
Evans:
One thing must happen if we are going to address
the deficit: the Opposition have to accept that there will be cuts.
They have to recognise the areas in which they are going to accept
them, but they have not done that so far.
I respond to
the hon. Gentleman’s second point by using the word
“compromise”. Our party has had to compromise. In our
manifesto, there were proposals that I spent a great deal of time
trying to persuade voters in my constituency to support, but that we
cannot carry forward. That is because, no matter how often the
Opposition claim it, this is not a Conservative
Government—[Hon. Members: “Yes it
is.”] I know it is in the Opposition’s interest to cackle
that it is, but the reality is that this is a coalition Government of
two parties.
Nick
Smith (Blaenau Gwent) (Lab)
rose—
Jonathan
Evans:
I will definitely let a Member from Tredegar
intervene in a moment, but I will make one point first. The Opposition
also have to understand that although they sit there looking as though
they outnumber
us—
Owen
Smith (Pontypridd) (Lab):
It is
true.
Jonathan
Evans:
But is it? In Wales, 36% of the electorate
supported the hon. Gentleman’s party while 46% supported my
party and that of our hon. Friends, the Liberal Democrats. Before
anybody says “proportional representation”, those Members
who have known me the longest will know that, for 20 years, that issue,
like Europe, has been one on which I have not been a mainstream
Conservative thinker. I strongly believe in proportional
representation, and I will develop that point in a moment, but Labour
Members should realise that, although there are 26 of them, there would
be 10 fewer under a proportional
system.
Nick
Smith:
I thank the hon. Gentleman for giving way. It is
typical of the good manners of men and women from Tredegar that we
speak up for others from the same town, although, of course, we have
very different politics. I note that the hon. Gentleman’s
brother has Labour
politics.
There
has been a lot of talk about collaboration and progressive politics
today. I want to comment on the gulf in the seating arrangements.
Frankly, we could channel the River Taff into the differences between
the two Government parties. It is interesting that Liberal Democrat
Members are embarrassed by their coalition—I just want to make
that
point.
Jonathan
Evans:
Even though the hon. Gentleman comes from such a
wonderful town, that was not the best of interventions, because there
is not much that I can respond
to.
I
have known the hon. Member for Brecon and Radnorshire for more years
than the Committee may realise. In his maiden speech, he pointed out
not only that I formerly represented him in Parliament, but that at one
stage he was my landlord. We have discussed political matters in
challenging ways over the years, and I was one of the last people to
think that we would end up in this coalition, but the reality is that
the circumstances of today demand that arrangement in the interests of
our
country.
Mrs
Gillan:
I am grateful to my hon. Friend for giving way,
because I can welcome him back to the House of Commons. We are both of
the class of ’92 and made our maiden speeches then. Does he
agree that it is ironic that Opposition Members are so busy trying to
run down the coalition Government, who are working so well? That
compromise is in the interests not of party political advancement, but
of the advancement of the country. Is it not ironic that Labour and
Plaid Cymru are in coalition in Cardiff, where they seem to co-exist
quite happily? Is the lack of a respect agenda from the Opposition
Members a sad reflection on the Labour party
today?
The
Chair:
Order. Once again, interventions are getting
somewhat lengthy, and there are several people who want to
speak.
Jonathan
Evans:
The reality is that we live in a country of
multi-party politics in Wales. It is inconceivable that we will have
one-party rule in Wales. Labour struggled with that idea but
subsequently formed alliances with the Liberal Democrats on one
occasion and Plaid Cymru
on another. The reality is that all political parties have a role in
decision making in Wales, which is the new politics that people must
get used to. The Conservative party has had to recognise the major
constitutional changes that have taken place, and the existence of the
coalition is one of those challenges. I pay tribute to Liberal Democrat
Members, because I recognise that it is a big challenge for them as
well, but it is a challenge that is ultimately in the national
interest.
I
hope that the Liberal Democrats will not be offended, but, as a
long-standing supporter of electoral reform, I do not agree that the
alternative vote system is a system of electoral reform. In my view, it
does not address any issue in relation to proportionality. The
disparity between Members and votes that we see in the Committee today,
where the votes are on this side and the Members are on the other side,
might not change much with AV. I would certainly support a change that
introduced proportionality, even though it is anathema to many other
Conservatives, but the AV system would not achieve
that.
I
am bearing your comment in mind, Mr Sheridan, and I will draw my
remarks to a close by making an observation about the forthcoming
referendum. In the Queen’s Speech, there were a number of
measures by which we will be endeavouring to devolve power to local
communities. We will try to devolve power on planning to local
councils, without having them second-guessed from above. We have
concepts on the delivery of free schools, and we anticipate the
empowerment of voluntary bodies. That agenda has a great deal to
commend it, and it should have more cross-party support than we have
heard so
far.
One
concern is that the referendum debate is all about, “Should we
have more powers in the National Assembly?” rather than,
“Should the National Assembly engage with the agenda of ensuring
that powers are devolved to local communities, voluntary groups and the
rest?” When we have the debate, I want that question to be
addressed by those people who argue most strongly for powers to be
devolved to the National Assembly. If that can be satisfactorily
addressed, and if we—and the National Assembly,
too—believe in ensuring that we win local empowerment, I for one
would enthusiastically support the transfer of those powers. If
elsewhere in the country such powers end up in local communities, but
in Wales they stay in the National Assembly, people in Wales need to
know that before voting in the
referendum.
3.6
pm
Albert
Owen:
It is a genuine pleasure to follow the hon. Member
for Cardiff North. I am sure that the whole Committee welcomes the
remarks that he made about his predecessor, Julie Morgan. He has
graciously done that on several occasions. It is also good to hear in
this place from a one-nation Conservative—from Wales, as
well.
I will be
brief, because of the time constraints following several interventions
and long speeches by Front Benchers, but like the hon. Member for
Dwyfor Meirionnydd, I want to start by
welcoming—genuinely—some of the measures in the
Queen’s Speech, particularly the energy and green investment
Bill. There is consensus among all the parties in the House of Commons
on the desirability of a green investment bank. I want that to succeed,
and I will support it. There is currently a debate in the
Chamber—we cannot be in two places at once—on energy
efficiency, which will form the core of that Bill. Again, how can we be
against energy efficiency measures? Such policies have been developed
by the National Assembly, and in Wales we will benefit from what we can
achieve together here and in the National
Assembly.
I
also agree with the hon. Gentleman on the Equitable Life payments
scheme Bill, which I hope is taken forward. In the previous Parliament,
the Conservatives—I joined them on occasions—said that
they would rapidly implement the ombudsman’s recommendations on
compensation. There was to have been a quick resolution after the
general election, whichever party won, but I hope that the Bill will
now be pushed
through.
I
also welcome some of the remarks the Chancellor made in the Budget
statement about helping business outside south-east England. I am not
sure how that will work or how companies will benefit from the national
insurance measures, but I think that companies might benefit, as they
might from a further reduction in corporation tax. Corporation tax was
reduced in the previous Parliament, and we need more reductions in the
future. I have put this point to the Chief Secretary, but the change to
the fuel rebate is a sensible idea, on which I have campaigned for
several years. It is unfair that one company sells petrol at
considerably dearer prices in rural areas of the United
Kingdom.
I
am concerned about the regressive nature of the Budget, however. The
2.5 percentage points increase in VAT will wipe out any possible rebate
on fuel, which will hurt rural areas very badly. There is no doubt that
the Budget is regressive. The Government say that it is tough and fair.
Well, they are half right—it is tough, but it will not be fair.
I will not go over the comments made by my right hon. Friend the shadow
Secretary of State, who referred to articles in The
Observe
r. Now that many organisations and experts have had
time to examine the Red Book and the Budget measures, it is clear that
the poorer will be worse off because of the Budget’s regressive
nature. Some families will be six times worse off than the richest,
because increasing income tax allowances benefits everybody, but the
poorest in society form the highest proportion of those who buy goods,
so the VAT increase will clobber
them.
On
debt reduction, the Chancellor is misleading the country when he says
that this is the worst debt in peace time. It is not. Historically, we
can learn from Neville Chamberlain’s Budget in the 1930s, when
debt was 177% of GDP and the interest on that debt was 40%. If we look
at the current Red Book, the debt in 2010-11 was 69.1% of GDP—I
know that that is high, but it is not as high as in many countries, and
certainly not as high as it was in the 1930s—and the interest on
that debt is 6.3% of public
expenditure.
We
need to put that into its proper context, and we have to learn from the
’30s, which we—the previous Government—did. The
fiscal, global, international, economic crisis of the 1930s saw mass
unemployment. We have seen high rises in unemployment, but they have
been nowhere on the scale seen in the 1930s because of the fiscal
stimulus that the Labour Government introduced. That created the extra
burden of debt, but the fiscal stimulus can, I believe, help us to grow
out of recession, in addition to raising taxation and making difficult
choices and cuts. That triple act is the fairest way of reducing the
debt. I still believe that raising national
insurance is fairer than raising value added tax. In fact, the
Conservatives have kept part of that increase in national insurance,
even though they said that they were against
it.
Alun
Cairns:
The hon. Gentleman talks about national insurance
increases for employers, but what analysis has he made about the impact
of that on, for example, the health service? It is Wales’
largest employer, and his party would have returned money to the
Treasury through those increases, instead of spending it on
health.
Albert
Owen:
The Treasury wants money, and that is why the
Government are making huge cuts—to bring money back in. It is a
little rich of the hon. Gentleman, although I know that he is a new
Member. I voted for an increase in national insurance in my first
Parliament. The current Prime Minister voted against it. That measure
was for investment into the health service. The Government are trying
to lecture us about not increasing national insurance, but we voted for
that measure because we wanted to see more money going into the health
service, to raise it to European standards. I know that the Government
are against raising national insurance, but I feel that it is
fairer.
As
The Guardian reports today, the cat is coming out of the bag on
unemployment. There will be increases in unemployment in Wales. During
the first decade of the Labour Government, there was an increase of
7,000 jobs in my constituency, which has structural problems of
unemployment. From the mass unemployment of the ’80s and
’90s, we saw a 29% increase in employment in my constituency.
This Budget and the Queen’s Speech put that at risk, and that
worries me. The Secretary of State nods her head. Can she give me an
assessment of what impact her party’s policies will have on
unemployment in my constituency? I am dealing with the facts and what
is actually happening, and I am worried that many more people will lose
their jobs in the future because of the measures in the emergency
Budget.
Mrs
Gillan:
I pay tribute to the hon. Gentleman, because, as
everybody on this Committee would agree, he has always spoken up for
his constituency. I have been particularly keen on the way that he has
championed Wylfa. I think that he would agree that Anglesey’s
economy would not be in its present state if his party had taken
decisions on Wylfa sooner, which was disappointing. I assure him,
however, that in the spirit of his representation. I will always look
to Anglesey to see what I can
do.
Albert
Owen:
I am sorry that I gave way, because the right hon.
Lady did not answer my question whether she would make a prediction on
future unemployment. The decision on Wylfa was made in 1987—the
Conservative Government decided not to go ahead with Wylfa B because of
the dash for gas. Between 1997 and 2001, the Government stalled the
decision and the planning was bogged down. How will yesterday’s
announcement on planning impact on decisions on matters such as a new
Wylfa B, and who will make those decisions? Will it be the Department
of Energy and Climate Change, or the Department for Communities and
Local Government?
It has a constitutional impact on Wales if an England-only Department
makes the decision? I want to see the relevant Department for the
sector making those decisions, whether that be the Department for
Transport or the Department of Energy and Climate Change, rather than
the Department for Communities and Local
Government.
I
will finish on the important issue of broadband. There has been huge
investment in the infrastructure for broadband, and the Chancellor made
big play of the subject in the emergency Budget, when he suggested that
the Government will not go ahead with the so-called landline tax. I
believe that that was a fair tax, because the United Kingdom should
have universal broadband. I guarantee that if the Government do not
invest in the infrastructure, the market will not deliver broadband to
regions such as north-west Wales. The landline tax of 50p a month would
have provided the investment that private companies were asking
for.
The
Conservative-Liberal Democrat Government’s alternative
proposal—again, I ask the Under-Secretary to respond—is
that money left over from the digital switchover, which they estimate
will be £350 million in 2012, will be spent on two pilot
schemes. I want that to be cleared up, because we could wait decades
for fast broadband in north-west Wales. If universal broadband is not
provided, places such as west Wales will suffer and will be in the
second division. I am concerned that the measures announced in the
Budget will mean that we will not receive the investment that 21st
century companies want, and I hope that the Under-Secretary will
address that.
The Budget
lays bare the fact that the Tories are reverting to type by raising VAT
and inviting mass unemployment, which will hit areas of Wales the
hardest.
3.16
pm
Alun
Michael:
Welcome to the Committee, Mr Sheridan. You will
be pleased to hear that the first successful prosecution in Wales under
the Gangmasters (Licensing) Act 2004 took place a couple of weeks ago.
That Act, which you guided through the House and on which I worked with
you, is a positive
measure.
It
is sad that the Secretary of State has hidden behind the Chief
Secretary, who, as my hon. Friend the Member for Clwyd South eloquently
outlined, came to make the unbelievable claim that the Liberal Democrat
and Conservative Budget is progressive. It is not. The increase in VAT
to 20% imposes a regressive burden that will fall disproportionately on
ordinary people and the less well off, and that will be especially true
in Wales.
The Chief
Secretary claimed that it is a fair Budget, which it is not, for the
same reasons, and he claimed that the cuts are necessary and
unavoidable to deal with the deficit, but the key challenge for the
Government is to manage the tension between reducing the deficit and
nurturing growth and recovery. The Budget cuts deep into the flesh of
the economy, while failing to give those affected the time to plan and
prepare. We all know that in-year cuts are expensive and inefficient
and do far more damage than well planned and measured reductions. The
Labour Government were realistic in facing up to the necessity of
cutting public expenditure—let us remember that the need for
cuts was caused by the international banking crisis—but they
allowed time for the economy to recover.
We heard in
the media today that the Secretary of State for Justice plans to cut
prison numbers by depending less on short-term prison sentences and
placing more emphasis on community sentences. So far, so good. That
follows the Justice Committee’s recommendation on justice
reinvestment, which was published a few months ago. That report,
however, recommended a coherent set of changes, and three other
elements are necessary for the Justice Secretary’s initiative to
succeed. First, the police and every other element in the criminal
justice system need to focus clearly on cutting crime and disorder at
local level, yet the initiative was announced in the week in which the
policing pledge was scrapped. Secondly, the initiative requires a
partnership approach that uses the capacity of a variety of bodies to
reduce offending by reducing the prevalence of drug dependency,
alcohol-related issues, mental health issues and other problems that
fuel offending. Thirdly, the initiative requires investment in the
justice system’s capacity to deliver effective community
sentences. We know that schemes such as restorative justice work, but
they do not happen out of the blue or without appropriate
resources.
Wales
offers examples of success. There has been a 40% reduction, not in
police numbers, nor in the number of people taken to court, nor in the
numbers going to prison, but in the number of people going to A and E
requiring treatment after being the victim of a violent offence. What
victims want—other than not to have become a victim in the first
place—is to know that they will not become a victim again. It is
essential to get the criminal justice system to focus on reducing
offending. That leads to savings for the NHS—through that 40%
reduction in people coming for treatment—as well as savings in
police time and a reduction in the number of victims. However, to
achieve that requires a coherent, joined-up approach. To cut prison
numbers while cutting all three of those necessary elements is a
dangerous approach. I want policies that lead to a cut in prison
numbers because crime has gone down, not an arbitrary decision to put a
cap on prison numbers simply to save money. The cut to the policing
pledge includes abandoning the emphasis on response times to 999 calls.
That is not
sensible.
Going
back to the economy, I heard the chairman of the CBI in Wales the other
week. While welcoming the cuts, for reasons that were slightly unclear,
she told us that the CBI was upgrading its growth forecast from 1% to
1.3%. She acknowledged that things are not as black as this Government
had portrayed them only a few weeks earlier. She spoke of fears about
the impact of the cuts, in particular the danger of creating a
generation of young people who are abandoned and who have no jobs or
opportunity. That is not a fear: that is about to become a reality as a
result of this Government’s decisions.
The
Government have abandoned the pledge to give a job or a training place
to every young person who is unemployed for a few months. Have they
learned nothing from the appalling mistakes made by the heartless
Government of the 1980s under Margaret Thatcher? That is what brought
me into national politics— the experience of working in
my city of Cardiff with unemployed young people who had been
denied hope and opportunity, a job and a future. That is what
the Thatcher Government gave us. What brought me into national politics
was the desire to tackle and change that.
That contrasts
massively with the steps taken by the Labour Government in recent
months, in some of the most difficult periods, to say that we will
guarantee a future for those young people and engage them to make sure
that they stay in touch with the economy and are not abandoned by cuts
that go too deep, too fast. The Labour Government were prepared to take
difficult decisions to cut expenditure, but to do so in a sensible way
that was designed to nurture growth and keep the future generation in
touch.
Finally, the
Chief Secretary claimed that this Government want to help small
businesses. Wales is disproportionately dependent on public sector
jobs. I share Carwyn Jones’s wish, rightly expressed, that we
need to nurture the private sector and enterprise in Wales, but public
sector employees spend money in the local economy, so the cuts, which
will be disproportionate in the public sector in Wales, will also
damage the private sector. That is the warning: the abandonment of
young people, and pain for the private as well as the public sector in
Wales. I call on Ministers to heed that warning and learn from the
mistakes of their Conservative predecessors in the 1980s and
1990s.
Several
hon. Members
rose
—
The
Chair:
Order. We have several speakers left to speak and
we have 15
minutes.
3.23
pm
Glyn
Davies (Montgomeryshire) (Con):
Thank you for giving me an
opportunity to make my first contribution to the proceedings of this
House, Mr Sheridan. I have not had much luck so far. I asked to make my
maiden speech in a debate in Westminster Hall, but as soon as I said I
wanted to speak, the proposer of the debate, my hon. Friend the Member
for Shrewsbury and Atcham (Daniel Kawczynski), was immediately taken to
hospital for treatment. I then asked if I could make my maiden speech
in the Budget debate on Wednesday, but then I was taken to hospital for
treatment and was there for three days. I hope Members are all well and
nobody is feeling a bit sick at the moment.
I want to
speak briefly about an issue that is important to me: the commitment in
the Queen’s Speech to hold a referendum on moving to part 4 of
the Government of Wales Act 2006. There has been a lot of discussion
over the years on that issue. I remember that a lot of the Opposition
parties in Wales felt that a Conservative Government would be so
involved in dealing with the economic crisis that we believed we would
be facing that we would not be prepared to do this. It was a huge event
for Wales when, at Broughton, my right hon. Friend the Member for
Witney, then the leader of the Opposition, committed the party to
holding a referendum. Certainly for me that was a big deal, and I was
very proud to be in the Chamber to hear a commitment to holding that
referendum.
I
will look very briefly at the history of where I and several other
people come from. I was not in favour of devolution—establishing
the National Assembly—in the first place, and in 1997 I
campaigned against it. Travelling home from the count, however, I
realised that the reality was that we now had a National Assembly and
that it was here to stay. My hon. Friend the Member for
Monmouth, who is not in his place now, made reference to being a
Unionist. I was a Unionist who came to a different conclusion. I
immediately took the view that the arrangement under which there were
no primary powers, despite responsibility in devolved areas being
transferred, posed the danger of creating constitutional instability,
if not worse.
I certainly
was not alone in that view, because in 2006 we had another Government
of Wales Bill, which granted law-making powers to the National
Assembly, but by a very complex route. Earlier, the right hon. Member
for Cardiff South and Penarth referred to the number of legislative
competence orders that have gone through, but many people believe that
the system is far too complex and far too difficult to understand. A
lot of people took the view that we needed to move very quickly to part
4 of the Act, under which, in effect, primary powers in all the areas
devolved to the Assembly would be granted in one fell swoop, rather bit
by bit, which is what is happening. I am very much in favour
of
that.
The
point that is important to us, and which others have made, is that this
has to be a decision of the people of Wales. I will probably argue for
a yes vote in the referendum, but if I lose I want to be in a position
where I have great respect for the other side of the argument and feel
that it is a genuine decision of the people of Wales. I hope that we
can go forward in the debate without rancour and that it will
be a genuine debate, in which those of us who take different views
argue our case and make it politely and with respect for others’
points of view. We can then all stand behind the decision that is
taken. I feel that that is what we really want in the referendum, and
that is what I am committed to
doing.
3.28
pm
Owen
Smith
:
I shall return briefly to what I think has
been the most important issue that we have discussed today: the Budget
and the rather rushed rehash that we heard this morning from the Chief
Secretary of last week’s speech by the Chancellor.
There was a
moment in the middle of the right hon. Gentleman’s speech when I think
we heard the kernel of the Government’s rationale and hopes for
the Budget. I paraphrase slightly, but in effect the Chief Secretary
said that the Budget was a credible plan to restore confidence and to
allow the private sector to grow and to create jobs. That broadly sums
up what the Government hope will come out of their Budget. I think that
they are wrong on almost every count. It is not a credible plan, it
does not restore confidence, and it will not allow the private sector
to grow and expand. As someone who has worked in the private sector for
the past five years, I have seen a great lack of confidence and I do
not see that changing
now.
We
hear a lot of rhetoric in this place, but sometimes facts are worth
bearing in mind. We should start to look at the facts, at how the
markets have responded and at how those people who will make the
decisions in the private sector about how we might see growth in the
economy are responding. I think that the message is already clear. We
have a Budget that was forged with the
hot breath of the credit rating agencies and the markets on the neck of
the Chancellor, and it is a Budget that we will repent at leisure
because the markets are already reneging on their side of the
deal.
Jonathan
Edwards:
The hon. Gentleman is making a fantastic point.
Does he agree with the economist Joseph Stiglitz that negotiating with
the markets is like negotiating with a crazy man: you might give him
exactly what he wants, but he will still shoot
you?
Owen
Smith:
I almost always agree with what Joseph Stiglitz
says, and he was absolutely right about that. We have already seen the
markets reneging. They pressed for a draconian Budget and radical cuts
in the public sector and in public services, and they promised to sweep
in, fill the gap and pick up the people who were thrown on to the
scrapheap, but what do we see right now? We see the FTSE plummeting, as
it did yesterday, bond yields declining dramatically and the gold price
going up—all clear indicators that the Budget has not reassured
the markets. The markets are much more worried about the long-term
impact of a failure to re-stimulate growth in our economy and are
concerned that the very thing that they did not want to see—a
longer or double dip recession—might be exactly what is prompted
by the cuts. A clear set of such indicators is already emerging from
the
City.
We
can also look around the world. The other fundamental underpinning of
the Budget idea for growth is that we would see export-driven growth,
creating the fabled 2.5 million jobs in Britain through an
export-driven economy over the next five years. Exactly where will we
export those products? Only today we have seen slowing growth in China
and, yesterday, figures out of the US saying that its economy is
slowing dramatically. We anticipate further indications from the US
that it, too, will not be buying our products when the non-farm payroll
figures come out at the end of this week. We all know that Europe, our
principal trading partner, is absolutely unable to buy our products and
services.
We
should therefore be worried about what we have seen of the Treasury
figures brought to us this morning by The Guardian. The Office
for Budget Responsibility concludes that there will be job
losses—100,000 in the public sector and perhaps 140,000 in the
private sector, per annum. Again, that gives the lie to the notion that
we can cut the public sector without any impact on the private sector.
They are symbiotically linked and if we cut one the other will bleed.
Those job losses will arrive, the OBR says, and I see no indication
that we can be hopeful, as the Prime Minister and the
Secretary of State clearly are, of seeing that magical figure
of 2.5 million new private sector jobs filling the
void.
We
should look at the facts. I wonder whether any hon. Member looked at
yesterday’s statement from 12 of our leading
companies—including Morrisons, the train company Arriva, Jaguar
and the Co-operative—saying that they have no intention of
expanding their work forces over the next 12 to 24 months. As I said, I
worked in an industry, the biotech industry, which over the past five
years has been doing what most of the big industrial players are
doing—deleveraging, paying down their debt and getting ready to
weather the long storm that they know is coming and which they know
will be compounded by this Government’s
Budget.
3.33
pm
Mr
David Hanson (Delyn) (Lab):
I realise that time is
pressing, so I shall make a couple of brief points. For the first time
in 13 years, I have been able to speak in this Committee, so it is a
pleasure to be here, although I am sorry to have to be speaking about a
Budget that I believe is unfair and will damage the interests of Wales
as a whole. I do so because the 26 Labour Members of Parliament
represent the voice of Wales—we have a duty to stand up for
Wales.
The
Government had choices to make in the Budget but they have made the
wrong choices. They have made the wrong choice on VAT, which will
damage and hit the poorest people in our community. They have made the
wrong choice on cuts in public spending, which will hit, as my hon.
Friend the Member for Pontypridd said, not just those in the public
sector but also the private sector companies that depend on the public
sector for their income and support. In a range of ways, the Budget
will hit the poorest people in our society as a
whole.
I
recognise that you want to commence the wind-ups at 20 minutes to 4, Mr
Sheridan, so in the time available I want to make one particular plea.
I mentioned the matter to the Under-Secretary of State yesterday. We
have had a freeze on a major industrial project in north Wales, the
A400M, based in the constituency of my hon. Friend the Member for Alyn
and Deeside. The project was signed by my right hon. Friend the Member
for Coventry North East (Mr Ainsworth), when he was Secretary of State
for Defence, before the election. That major project for 22 planes
would employ people in Bristol, south Wales and north Wales.
The fact that
the Government have frozen the project, and are awaiting the strategic
defence review before they confirm it has a major impact on future
confidence in the airbus industry in north Wales. It is a matter that I
hope the Minister will take away from the Committee today and I hope he
will press hard for the commitment of the Secretary of State for
Defence to reach an early decision so that we can ensure that the A400M
is undertaken as a matter of urgency, that the contract is confirmed
and that jobs come to north Wales and Bristol in one of the crucial
manufacturing sectors in the United
Kingdom.
The
Queen’s Speech missed a great opportunity in relation to crime
and policing—matters for which I had some responsibility in the
previous Parliament. The cuts in the Budget impacted on north Wales by
£1.4 million, Dyfed Powys by £900,000, Gwent
by £1.3 million and south Wales by £2.8 million, which is
a total of £6.4 million in cuts. The
Government—the party of law and order—have also refused
to endorse the previous Government’s position on DNA. People
will potentially not be convicted of serious crimes. That surprises me
coming from the so-called party of law and
order.
We
have a cooling on CCTV. We have the abandonment of the policing pledge
and the confidence target, as my right hon. Friend the Member for
Cardiff South and Penarth said. Cuts in police numbers are coming down
the line. The Government will actually undo the great work done by the
Labour Government in reducing crime by 37% during the past 13 years.
Will the Government please ensure that their measures on CCTV, on DNA,
on police funding, on confidence measures and on the
policing pledge do not cause crime to rise throughout Wales with chief
constables making cuts on front-line policing that will damage the
communities that we
represent?
3.37
pm
Jonathan
Edwards:
Rather than reciting the fine speech that I
prepared on the Budget, I shall just make one brief point to which,
hopefully, Members on the Front Bench will respond in their wind-up
speeches. My party is concerned about the opacity of the cuts regarding
Barnett consequentials. One of the recommendations of the Holtham
commission was an annual publication showing the effects of Barnett
consequentials so that we could see how the Treasury arrived at the
figures. On 24 May, the new Government announced £6.2
billion of in-year cuts, of which £187 million were for Wales. I
have asked several questions about the provenance of the cuts,
including asking Departments to release the calculations, but none has
been
given.
I
have also asked Departments for their non-devolved spending cuts in
Wales. Is it not ridiculous that MPs can ask questions of the Treasury
and other Departments, but receive the most opaque responses? How can
funding for Wales possibly be transparent and open to scrutiny if we
are told only the figures but not how they were arrived at? How can we
establish whether they are correct? One of the questions I have
submitted is to establish how much has been paid to Wales as a result
of nuclear support to the former Soviet Union, following an answer that
I received to an earlier question on 17 June that showed
that Wales received a 100% consequential. As part of the new respect
agenda, I should be grateful if Departments, when announcing spending
cuts or investments for England only, clearly show the Barnett
consequentials for
Wales.
Several
hon. Members
rose
—
The
Chair:
Order. We shall start the
wind-ups.
3.38
pm
Mr
David:
We have had an interesting day. It began with a
statement from the Chief Secretary to the Treasury. His appearance was
certainly a surprise to Labour Members, but he did not stay that long.
He scuttled off as soon as he could because he recognised the unwelcome
atmosphere, certainly on the Labour side of the Committee. However, one
consequence of his appearance was that many members of the Committee
who had been planning to make speeches during the day were not able to
do so. That underlines the need for proper consultation prior to such
events.
Kevin
Brennan (Cardiff West) (Lab):
My hon. Friend is right; my
right hon. Friend the Member for Cynon Valley and my hon. Friend the
Member for Blaenau Gwent were both trying to speak. What surprised me
was that the only Liberal Democrat Member who seemed interested in
speaking today was the Chief Secretary to the Treasury, and we did not
hear anything from other Liberal Democrat Members who were sat as far
back as possible.
Mr
David:
It was indeed noticeable how uncomfortable the two
hon. Members on either side of the Liberal Democrat Minister were
during the course of the day.
Mr
Llwyd:
This morning there was constant talk about whether
or not we were told about the imminent visit by the Chief Secretary. I
received an e-mail at the same time as the right hon. Member for Neath,
but the interesting thing is that the Welsh press knew two days ago,
which is
unacceptable.
Mr
David:
I am glad that the hon. Gentleman has reinforced a
point that we have made.
The Chief
Secretary to the Treasury was followed by the right hon. Member for
Chesham and Amersham, who gave an inventive speech. She made a number
of remarkable statements, not least declaring neutrality on the issue
of a referendum. We believe strongly that there is a need for
leadership on such a crucial issue—they cannot impale themselves
on a fence. The people of Wales will want to know what the Government
believe. Is it a good thing or a bad thing? What we want is leadership,
not abdication.
Mrs
Gillan:
Will the hon. Gentleman give
way?
Mr
David:
No, I will not give way, because the right hon.
Lady did not give way to me—the phrase “hoist with her
own petard” springs to mind. She is neutral about the governance
of our country, but neutrality is not good enough. It was matched only
by her indifference—about the representation of the people of
Wales in this Parliament and in the Welsh Assembly; about unemployment,
particularly in the public sector, where we are likely to see it
increase rapidly; about the safety of communities when police numbers
are cut; about the impact of VAT on the poorest members of our society
and about the future of young people, who will be thrown to one side
once the future jobs fund is eliminated. In short, what we have seen
today is indifference and neutrality about the future of
Wales.
We have heard
contributions from other Members. We had positive ones from the hon.
Member for Dwyfor Meirionnydd, my right hon. Friend the Member for
Torfaen, my hon. Friends the Members for Clwyd South and for Ynys
Môns, my right hon. Friend the Member for Cardiff South and
Penarth, my hon. Friend the Member for Pontypridd, my right hon. Friend
the Member for Delyn and the hon. Member for Carmarthen East and
Dinefwr. All of them shared concern about what has been suggested,
particularly in the Budget.
We also heard
comments from the hon. Members for Montgomeryshire, for Cardiff North
and for Monmouth. The contribution by the hon. Member for Cardiff North
was good. It was parliamentary and decent to make the remarks he did
about his predecessor, which was in marked contrast with some of the
contributions from some other Conservative Members
today.
A
number of clear themes have emerged during our deliberations. The first
is the Government’s ability to rewrite history. Although I
welcome the Government’s capitulation on the housing LCO, let us
be clear that in the run-up to the general election, the then
Opposition, now the Government, were clearly opposed to it. They are
now telling us that the LCO has not changed, and I look forward to many
more U-turns in the near
future.
Another
clear theme is that the Budget will harm Wales. It will pay a high
price for Tory dogma. We should not be surprised that the right hon.
Member for
Wokingham (Mr Redwood) wrote on his blog recently
that if people found life difficult after the Budget, they should
simply put on a jumper, turn down the thermostat or eat more vegetarian
food. The right hon. Gentleman is a former Secretary of State for
Wales, and the right hon. Member for Chesham and Amersham follows in
his footsteps in representing an English constituency. I will not
mention how many times she visits Wales or where she stays when she
visits. I will not even be critical of the fact that it is absurd for
the Secretary of State for Wales to represent a constituency miles from
Wales. However, I would like to quote a Conservative Member for South
Wales Central in the National Assembly, Mr David Melding, to
pay him credit. He said quite honestly and correctly that the
Conservative party has
made
“terrible
errors in appointing English Secretaries of State for Wales…it
was quite
unacceptable.”
That
must be the first time in a long time that I have agreed with a
Conservative Assembly Member, but I must say he is spot
on.
The
Government’s legislative programme is in general backwards, and
where it is not backwards it is harmful to
Wales.
Alun
Cairns:
Will the hon. Gentleman give
way?
Mr
David:
I do not have
time.
The
so-called emergency Budget will harm the poorest in our communities. It
will risk a double-dip recession, increase unemployment and create a
Wales that is more unfair. Shame on the Liberal Democrats for giving it
their
support.
In
conclusion, it is necessary in this important debate to have a
Division, and I urge my hon. Friends to vote against both the
legislative programme and the Budget
statement.
3.46
pm
The
Parliamentary Under-Secretary of State for Wales (Mr David
Jones):
It is a pleasure to address the Grand Committee
today. Frankly, given that this is the first Grand Committee of this
Parliament, that it takes place against the background of the worst
peacetime deficit that this country has known and a change of
Government after the Labour party was defeated, one might have expected
some more sobriety of tone from the
Opposition—
The
Lord Commissioner of Her Majesty's Treasury (Mr Brooks
Newmark):
And
humility.
Mr
Jones:
Indeed, as well as a touch more humility. But there
was none of that—the shadow Secretary of State showed none. It
is clear that he orchestrated the mass act of rebellion on the part of
Opposition Members, and it is fairly clear, too, that he is bereft of
anything positive to say, given that he resorted to the most appalling
and personal attacks upon my right hon. Friend the Secretary of
State.
Mr
Hain:
Not one personal
attack.
Mr
Jones:
The right hon. Gentleman seems to regard it as an
appalling thing that the Secretary of State should represent an English
seat. First, she happens to
be a Member of this Parliament and, the last time I looked, the Labour
party was a Unionist party and should therefore have no objection to
that. Secondly, she happens to be Welsh bred and raised, and has the
enormous advantage of having been born in the northern hemisphere. If
one is minded to make personal remarks, they could operate in both
directions, but of course I will refrain from doing
that.
The
Labour party was today given the opportunity to ask questions of the
Chief Secretary to the Treasury.
Mr
Hain:
We had no
notice.
Mr
Jones:
The right hon. Gentleman says he had no notice. He
had a copy of the Chief Secretary’s statement in advance of his
appearance, approximately the same notice that the former Chancellor,
the right hon. Member for Edinburgh South West (Mr Darling) gave to the
Committee 10 years ago. [
Interruption.
] The right
hon. Gentleman may wish to continue heckling or if he wishes to
intervene, I will take his
intervention.
Mr
Hain:
The point is that we knew, at least a day and
probably a week before, that the statement was being made by the
Minister. That would have meant that the Grand Committee could adjust
its proceedings and people would not have prepared speeches that they
have not had time to give. That is the point; there was supreme
discourtesy in not giving notice that the Chief Secretary was
coming.
Mr
Jones:
All I would say is that a copy of the Chief
Secretary’s statement was made available to the right hon.
Gentleman. He had as much notice as the former Chancellor gave to the
shadow Secretary of State for Wales 10 years ago.
[
Interruption.
]
The
Chair:
Order. May I ask both Front Benches to remain calm
and allow the Minister to speak without being
interrupted?
Mr
Jones:
Thank you, Mr
Sheridan.
It
is a huge pity that the shadow Secretary of State is clearly so bruised
by the outcome of the election—clearly so petulant—that
he could not bring himself to ask questions of the Chief Secretary to
the Treasury, whose policy he spent the rest of his speech criticising.
It is interesting that he criticised those policies and yet never gave
any indication of what the Labour party would have imposed in the way
of cuts. He tried to give the impression that it is possible to borrow
one’s way out of a recession when clearly it is not. He tried to
give the impression that cuts could be imposed without pain, which is a
cruel deceit on the people of Wales. He knows full well that the cuts
that his party would have imposed had it won the election would have
caused pain. Yet he tries to pretend that it is possible to achieve the
deficit reduction that this country needs without that pain. Frankly,
it is unworthy of him and I hope that in future Welsh Grand Committees
he will adopt a more positive approach.
We then heard
from the leader of Plaid Cymru, the hon. Member for Dwyfor Meirionnydd
who was much more positive and made a much more valuable contribution
to the debate. He welcomed several measures that the
Government are introducing. He was not without criticism of certain
other measures, as one would have expected. I was particularly pleased
to see his support for our proposals on the scrapping of identity
cards. Over the past 13 years this country has witnessed the most
worrying erosion of personal liberty, presided over by a Government who
felt that they could control every facet of people’s lives. I am
glad to say that this coalition Government are rowing back from that
and I hope very much that, when those measures are considered, he and
his colleagues will support
us.
We
had a contribution from the right hon. Member for Torfaen whose manner
in addressing the Committee was much more moderate. I am glad to see
him back in his place and I hope he enjoyed the introduction to the
other place of his friend Lord Touhig, whom I am sure we all wish well
in that new role. He commented upon the proposals to equalise the size
of parliamentary constituencies and I understand fully that there are
historical reasons for the current representation of Wales. Many of the
points that he made are important. Certainly in parts of Wales the
sparsity of population is a significant factor.
Nevertheless,
when we live in a global village and we frequently communicate by
telephone and the internet, it is worrying that a vote in parts of
Wales is worth, in some cases, double that of a vote in the south of
England. That needs to be addressed. I am sure that the right hon.
Gentleman would understand that is wrong in principle that votes should
carry different weight. It is also a matter of concern that the Welsh
vote has not been looked at again at a time when we have the National
Assembly and Wales has representation in another legislature.
Therefore, while I understand the important points that he made, it is
important to review whether the current arrangements are
appropriate.
We
heard from my hon. Friend the Member for Monmouth and I congratulate
him on his election as chairman of the Select Committee on Welsh
Affairs in succession to the hon. Member for Aberavon, whom I would
like to commend. I regard him as a personal friend and he was also an
excellent Committee chairman. I am sure that my hon. Friend will follow
the tradition that he has set. The Select Committee has done some
extremely important work and no doubt it will continue to do
so.
My hon.
Friend referred to the well known quotation from Jim Callaghan that it
is impossible to borrow your way out of a recession. That point was
echoed recently by the former Minister Lord Myners, who
said:
“There
is nothing progressive about a Government who consistently spend more
than they can raise in taxation, and certainly nothing progressive that
endows generations to come with the liabilities incurred by the current
generation.”—[Official Report, House of Lords, 8
June 2010; Vol. 719, c.
625.]
That is
what was particularly worrying about the Labour party’s policy.
Had the Labour party won the last election it would have destroyed the
opportunities that future generations should properly have
expected.
We
then heard from the hon. Member for Clwyd South who made her first
speech in this Committee and it was very nearly her maiden speech. I am
sure that we all welcome her to the Committee. She talked about the
impact of cuts upon her constituency. It is good to see her standing up
for her constituency, but there will
undoubtedly have to be pain and I am afraid that all parts of the
country will have to bear their fair share of
it.
Roger
Williams (Brecon and Radnorshire) (LD):
Will the
Under-Secretary give way?
Mr
Jones:
Forgive me, but I have very little time. We heard
from my hon. Friend the Member for Cardiff North, who proved that, in
political terms at least, it is possible to lose one’s virginity
twice by making his maiden speech in this Parliament. He made important
points on the necessity of taking painful measures to address the
deficit. He also commented on this country’s electoral system,
which we will have the opportunity to debate in the weeks to come, and
it was interesting to hear him say that he supports proportional
representation. I have always found it difficult to understand how it
is possible to have a fairer system than that whereby the candidate who
gets the most votes wins. Nevertheless, I respect my hon.
Friend’s views and I am sure that he will make a huge
contribution to that
debate.
Mr
David:
On a point of order, Mr Sheridan. The
Under-Secretary is clearly trying to talk out the debate. I indicated
earlier that we would like a vote and I would like that vote to be
taken
now.
The
Chair:
It would be inappropriate and without precedent for
me to accept a closure motion at this stage, so I will allow the
Under-Secretary to
continue.
Mr
Jones:
I am grateful, Mr Sheridan. The hon. Member for
Ynys Môn was charitable and fair in welcoming several measures
in the Queen’s Speech. He mentioned the Equitable Life Bill. One
of the greatest shames of the previous Government was that they did not
treat fairly the many thousands of people who were disadvantaged by the
Equitable Life affair. The hon. Gentleman has always spoken out
independently on behalf of his constituents who were affected by the
Equitable Life failure. I am glad to see that he is still doing
that.
Ian
Lucas (Wrexham) (Lab):
Will the Under-Secretary give
way?
Mr
Jones:
Forgive me, but I want to answer two points made by
the hon. Member for Ynys Môn. He asked what impact the
replacement of the Infrastructure Planning Commission would have on the
Wylfa proposal. It has been announced that a major infrastructure
planning unit will be formed, which will administer an extremely
similar system to that operated by the IPC. It
will have the huge advantage, however, of democratic accountability. I
am glad to say that the Department of Energy and Climate Change has
made it clear that there will be a strong Welsh voice about Welsh
projects and infrastructure
applications.
The
hon. Gentleman also raised the important issue of broadband, which is
significant in much of rural Wales, including my constituency. He will
recall, as a former member of the Welsh Affairs Committee, a report
about broadband in the previous Parliament. My feeling was always that
the then Government’s proposals were too
unambitious.
Mr
David:
On a point of order, Mr Sheridan. Is it possible to
have a vote
now?
The
Chair:
I stand by what I said
earlier.
Mr
Jones:
I am glad to say that this Government regards
broadband as a vital issue. They propose to roll out superfast
broadband and not the fast broadband that was proposed by the previous
Government. To that extent, the Government are determined to go ahead
to ensure that those not-spots in parts of rural Wales will be
addressed.
We heard from
the right hon. Member for Cardiff South and Penarth.
Question
put.
The
Committee divided: Ayes 7, Noes
21.
Division
No.
1
]
AYES
Bebb,
Guto
Cairns,
Alun
Davies,
David T. C.
(Monmouth)
Davies,
Glyn
Evans,
Jonathan
Jones,
Mr
David
Williams,
Roger
NOES
Brennan,
Kevin
Bryant,
Chris
Clwyd,
rh
Ann
David,
Mr
Wayne
Davies,
Geraint
Edwards,
Jonathan
Evans,
Chris
Francis,
Dr
Hywel
Hain,
rh Mr
Peter
Hanson,
rh Mr
David
Jones,
Susan
Elan
Llwyd,
Mr
Elfyn
Lucas,
Ian
Michael,
rh
Alun
Morden,
Jessica
Murphy,
rh
Paul
Owen,
Albert
Ruane,
Chris
Smith,
Nick
Smith,
Owen
Tami,
Mark
Question
accordingly negatived.
4.2
pm
Committee
rose.