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Economy

Volume 547: debated on Wednesday 27 June 2012

4. What recent assessment she has made of the economy in Wales; and if she will make a statement. (113167)

I have regular discussions with Welsh Government Ministers about the prospects of the Welsh economy and the need for closer working to help create the right environment for jobs, growth and prosperity.

Youth unemployment in my constituency has gone up by 16% in the last year—not helped by the Government’s scrapping of the future jobs fund. Is it not time that the Welsh Secretary took lessons from the Welsh Government and emulated their jobs growth scheme, started in April, with the aim of creating 4,000 jobs?

I agree that if there are lessons to be learned from the Welsh Government, we must learn them, but the hon. Lady must remember that unemployment is a matter for both the UK Government and the Welsh Government, and under the last Labour Government youth unemployment in Wales rose by 73% over the Parliament.

Is my right hon. Friend aware of figures from the Office for National Statistics and the AA showing that more than £16 million could be injected into the Welsh economy this year alone because Labour’s 3p August rise in fuel duty has now been scrapped?

Yes; my hon. Friend knows that the Government have shown that they have listened and are willing to help motorists further with their cost of living by acting at a time when the pump prices are still at historic highs and deferring the increase to January. I pay tribute to him, as he has of course played a great part in the campaign and has, in part, brought about this change by the Government, which will be welcomed throughout Wales, by businesses and families alike.

The Secretary of State talks about creating the right environment, and I agree with her on that. She will also recognise that in north-east Wales, Cheshire and the Wirral there is a common travel-to-work area. Will she put her support behind the campaign to improve and upgrade the Wrexham to Bidston line, as that would help to service that travel-to-work area and create the right environment?

The hon. Gentleman and I used to serve on the Select Committee on Science and Technology together, and I know that he is a constant champion for improving the travel arrangements in and around his area of the country. I have always supported the Wrexham to Bidston line, but I have always prioritised the electrification of the valleys lines and of course that unfinished business of getting the electrification down to Swansea. The electrification of the Wrexham to Bidston line would be close behind that.

Tourism is a crucial sector in the Welsh economy, not least in mid-Wales and Ceredigion. The contrast between the procession of the Olympic torch and the floods that we suffered in Ceredigion could not be any starker. I am appreciative of the Secretary of State’s visit to Ceredigion last week. Will she reiterate the message that the county council gave her, which was that Ceredigion is very much open for business?

I was delighted to accept the hon. Gentleman’s invitation to visit his constituency and look at the aftermath of the floods. It is when the media have left that it gets most difficult for the people who have been affected. I was impressed by the way in which that community has got itself back on its feet, and it certainly is open for business. If anyone is reading the record of or listening to these questions, they should know that his constituency of Ceredigion is one of the best places to take a holiday and that it really is open for business.

How is the mobility of Welsh labour improved if young people who are leaving the family home, getting on their bikes and taking low-paid work elsewhere are prevented from paying for their housing costs by the Government’s policy?

The hon. Gentleman and I share the same concern about youth unemployment. The unemployment rate in Wales remains unacceptably high at 9%, but I would have thought that he welcomed the fall in unemployment in Wales for the fourth month in a row. It means that the economy is moving in the right direction for many of the members of the work force who are still looking for work.

Has my right hon. Friend considered the economic impact of having different corporation tax regimes on either side of the English-Welsh border, especially since, as we have heard, there is a single economic sub-region in Cheshire and north-east Wales?

There is huge concern among the businesses that I have talked to about any prospect of changes in the corporation tax rate across the border between England and Wales. As my hon. Friend will know, that relates to the purpose of the Silk commission, which I established and which is looking particularly at the areas of taxation and accountability. I hope that it will report later this year and we will be able to see its recommendations.

Hard-pressed households across Wales will certainly welcome the Chancellor’s latest U-turn on the proposed August increase in fuel duty, but with Office for National Statistics figures today showing that borrowing is rocketing because this Government have created a double-dip recession, will the Secretary of State speak up for struggling businesses in Wales and the 130,000 people still looking for work, and ask the Chancellor to do a U-turn on his economic plans?

I welcome the new Opposition Front-Bench team. I also pay tribute to the right hon. Member for Neath (Mr Hain), who stepped down from the Front Bench last month and will be greatly missed. I welcomed the hon. Member for Pontypridd (Owen Smith), the shadow Secretary of State, during the Welsh Grand Committee, but I would like to do so again.

I say to the hon. Member for Llanelli (Nia Griffith) that, in addition to the support we have already announced, the decision that has been made to cut the fuel duty and scrap the previous Government’s fuel duty escalator, thus ensuring that fuel duty is frozen for 21 months, will help businesses and families in Wales. I am very surprised that she did not rise to the Dispatch Box to welcome that.

I thank the Secretary of State for that, but we do have quite a lot of questions to get through.