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EU Referendum: Political Consequences

Volume 613: debated on Wednesday 13 July 2016

2. What assessment he has made of the potential consequences for Wales of the outcome of the EU referendum. (905784)

The British people have voted to leave the European Union, and my right hon. Friend the Prime Minister has made it clear that their will must be respected and delivered. We are now preparing for a negotiated exit from the EU, which will involve close engagement with all the devolved Administrations to ensure that the interests of all parts of the United Kingdom are protected and advanced.

Structural funding for Wales is guaranteed until 2020. Given the substantial budgetary savings that will be made after British withdrawal from the EU, can my right hon. Friend confirm that his office will make every effort to ensure that the current level of funding will continue until at least that date?

The Government have a strong record in guaranteeing funds for Wales, most notably the Barnett floor, which was ignored for 13 years by Labour. That demonstrates that we will work hard in prioritising the areas of the UK that rightly need and deserve support.

Has the Minister had talks with major employers in Wales such as Ford, Airbus, GE, Toyota and Tata to find out what their investment intentions are following the vote to leave the EU?

The hon. Lady raises an important question. Within a week of the Brexit referendum I met a number of business leaders in Cardiff and last week I met a number of business leaders in north Wales. I was struck by their pragmatism and approach—the positivity they were showing. One of the most positive quotes was that entrepreneurs “thrive on change.” They recognise that we are not turning our backs on Europe, but opening up new markets across the globe.

Does the Secretary of State agree that every single Government Minister who has spoken on this issue has expressed their desire to ensure spending remains at exactly the same levels in Wales as it always has done, and that that shows this Government’s commitment to the people of Wales?

My hon. Friend makes an important point and allows me to underline once again the positive financial commitments this Government have made to Wales. In addition to the 115% funding for the Barnett floor that we have introduced, there is a £2.8 billion investment in electrification and £500 million for a city deal, on top of a range of other projects—UK taxpayers’ money being invested in Wales on top of the Barnett consequentials.

Given that Wales will no longer receive funding through the European regional development fund, which is allocated on objective needs-based criteria, and that Holtham saw the Barnett floor as a temporary transition measure, what consideration is the Secretary of State giving to developing a clearly needs-based formula for allocating funding to Wales?

There were many campaigns for a Barnett floor but it was only this Government who delivered on that. On European funds, we have not yet concluded our negotiating position, but simply replacing what are currently EU funds with another source from Westminster misses the point: the EU referendum sent out a number of messages, and those areas that receive most EU funds were the areas, sadly, that voted most strongly to leave the EU. We need to look at models of regional aid in a different way.

The debate on our future in the EU was very badly informed. Will the Secretary of State convene an independent inquiry to identify, quantify and publish the losses, and indeed any benefits, to Wales from leaving the EU and the steps he can take, within his powers, to safeguard our national interest?

A European Union unit is being set up in Whitehall, which will consider all the implications for my right hon. Friend the next Prime Minister in order to form judgments and direct Government policy, but we must recognise that if any country can make a success of leaving the EU it is the United Kingdom, with its proud history as a global trading nation.

I did ask about the Secretary of State’s Department. Anyway, I am concerned about the loss of common agricultural policy and convergence funding, and of research moneys to universities, and about the lost opportunities for young people to live, work and study abroad. But also, being Welsh and European, I feel the closing of our horizons towards a parochial little Britainism. What more can he do to ensure the future of our Welsh cultural London bypass to the rest of our continent?

I am disappointed by the hon. Gentleman’s question. He will understand that I have a close working relationship with the Welsh Government and with the First Minister in particular. What is in Wales’s interest is in the United Kingdom’s interest, and I am determined to do everything possible to maintain that positive relationship as we negotiate to leave the European Union.

The Secretary of State’s answers have been predictably vacuous and ambiguous. I want to give him a chance to boost his promotion hopes today by flouting all parliamentary traditions and giving a straight answer. Brexit is perilous to Wales, especially to the steel industry. There will be an immediate loss of £600 million, and there could be further losses later. The simple question—a one-word answer will do—is this: will he guarantee that under Brexit Wales will not lose any of the funding that it has now?

I can guarantee that Wales will get its fair share, through the Barnett floor and all the other means that I have highlighted. My party can give certainty of leadership with a strong visionary negotiating stance as we approach our departure from the European Union. It is quite obvious that we cannot have that certainty of leadership from the Labour party.