The Secretary of State was asked—
Our commitment to this country’s fishing industry is absolute, and we have defended it resolutely in our negotiations with the European Union. We promised fishermen in Wales, Cornwall and across the United Kingdom that we would take back control of our waters, and that is precisely what will happen.
Transition Period: Business
The Wales Office is engaged with businesses the length and breadth of Wales, with a simple message: “Make sure you are prepared for the end of the transition period, whether or not we reach a negotiated outcome with the EU.”
When I was speaking to sheep farmers in Builth Wells in my constituency at the weekend, they made it clear that they do not want to be a political football. They are keen to embrace the changes that will come, but they want the certainty that their Government will support them come what may. Will the Secretary of State confirm that he is working closely with all Cabinet colleagues to ensure that my sheep farmers are front and centre of the UK Government’s mind when transition ends?
Not only my hon. Friend’s sheep farmers but sheep farmers in constituencies across the House can feel confident that the Government are on their side. One way we can demonstrate that is the fact that we have guaranteed the £337 million of funding across the lifetime of this Parliament. People said we would not do it, but we have done it, and we are committed to ensuring that there is a healthy future for the farming industry, particularly livestock in Wales.
Diolch yn fawr, Lefarydd. It was interesting to hear the reference made to Welsh fishing previously, but I am sure the Secretary of State is aware that 90% of the Welsh fleet is made up of small boats, under 10 metres in length, which catch shellfish and non-quota fish species such as bass. Between the prospect of no-deal tariffs to their markets in Europe and the covid closure of hospitality, fishermen such as those in Porthdinllaen near where I live see no Brexit bonanza on the horizon. As Nelson might have put it, “Wales expects that every Secretary of State for Wales will do his duty.” Can the Secretary of State explain how his Government’s vainglorious Trafalgar posturing with warships in the channel helps our small fishing vessels?
I am grateful to the right hon. Lady for her comments. I was rather hopeful that leaving the common fisheries policy and regaining our status as an independent nation state might be something that would appeal to a separatist, but sadly that does not appear to be the case. I can answer her question, perhaps, by referring her to the inclusion in the spending review of £2 million-worth of support for fisheries in Wales in 2021-22 and for the lifetime of this Parliament. We share a common theme, in the sense that I too have those fishing interests off the coast of west Wales and I am very conscious of the problems she raises. That is why we are determined to ensure that they are properly looked after.
I am sure the Secretary of State is aware that there is a consultation going on about how to allocate fishing quotas in the future. If that is done on historical grounds for Wales, it will be very bad news indeed for our fishermen. Turning to the Prime Minister’s latest U-turn on the United Kingdom Internal Market Bill, it will give a modicum of flexibility to the devolved nations, but it is undeniable that the Bill is a disaster, weakening devolved power and centralising more power here in Westminster. The Conservatives and Labour have been working together this week to let efforts to give our devolved Governments a say in state aid fail. Will the Secretary of State commit to a productive U-turn this time, and assure me that no other powers will be reserved through the internal market Bill?
The fact that the Government have listened carefully to the arguments should not be deemed some kind of act of evil or a U-turn. It shows that we are conscious of the complexities of this legislation and have listened carefully to the arguments. Where the right hon. Lady makes a mistake is in thinking that the contents of the UK Internal Market Bill are somehow a threat to devolution. Actually, they are a means by which we can encourage inward investment into Wales and encourage jobs and livelihoods. We have had this exchange across the House before, and it strikes me as worrying that she always refers to power—it is all about power to Cardiff, rather than jobs and livelihoods in Wales. For a party that argues it is the party of Wales, it seems to be remarkably out of touch with the people of Wales.
One of the findings of our Select Committee report last week on this issue was that the Government have really stepped up their communication with Welsh businesses ahead of the end of the transition period, which is very welcome. The new money that the Government have announced for Welsh ports, including Fishguard in my own constituency, is very welcome too, but will my right hon. Friend say a bit more about what he is doing with the Welsh Government to ensure that the inland checking facilities that will be required ahead of the full implementation of new border checks will be in place, given the very challenging timetables that he is working to?
My right hon. Friend raises an interesting point. Of course, the devolution settlement poses its own complexities. With Holyhead, we have a Welsh Government-UK Government-HMRC relationship that needs to be managed as we progress towards the end of the transition period, but Fishguard and Pembroke on the coast of west Wales, in the areas we represent, are entirely in the gift of the Welsh Government. However, we have tried to ensure that we work almost on a daily basis with the Welsh Government to ensure that those delivery timetables and objectives are in place.
The Government’s failure to get the Brexit deal that they promised means we still have no clue about the terms on which businesses will be trading from January, and we face the very real prospect of a no-deal exit, risking chaos at our ports and shortages of critical goods. As the CBI and others have said all year, businesses cannot be expected to prepare for a no deal Brexit in the middle of a pandemic, so what is the Secretary of State’s message to those Welsh businesses that now face a Brexit cliff edge in just a few days’ time?
I have been working closely with the hon. Gentleman’s colleagues in Cardiff, hosting joint webinars and seminars. We are also engaging with businesses across Wales in limitless number of ways, and the message I am getting from them is not the same as the message that he has just delivered to the House. They are, by and large, prepared. They are certainly aware of the challenges, but also of the opportunities that this process throws up for them. I would also make the point that, right from the start of this, the hon. Gentleman’s party was saying that there would not be a manifesto commitment about a referendum, but there was, and that there would not be a referendum, but there was. They said that the leave camp would lose the referendum, but it did not. Then they said there would not be a withdrawal agreement, but there was. They said that the Conservatives would not win the election, but they did. Now he is saying there will not be a deal; I think we should wait and see.
I have been speaking to businesses across Cardiff North, and they are doing all they can to protect against the impact of a no deal, but they are deeply worried about supply chain delays, stockpiling and a tariff cliff edge. They are saying that they can put the sandbags down, but that’s it. So will the Secretary of State apologise to the many people in Cardiff North and across the whole country whose jobs and livelihoods he is willing to gamble and play politics with, and tell me whether his Government are preparing to fail or failing to prepare?
After all, it was the hon. Lady’s party that voted against a deal last year, so when she had the opportunity to land this more carefully, she chose not to and therefore increased the risk of getting the outcome that she definitely does not want. Attempting to pillory the Government when actually there has been considerable daily joint working between the Welsh Government, under the control of her own party, and the UK Government over many months to ensure that the risks are minimised, is not just an insult to the House but an insult to her own colleagues in Cardiff who have been devoting a huge amount of time to try to make this work as seamlessly as possible.
Shared Prosperity Fund
My right hon. Friend the Secretary of State has been in regular discussions with Welsh Ministers about the UK shared prosperity fund before and after the announcement of the spending review. Further engagement will take place as further details of the fund are announced.
I thank the Minister for that response. It has been suggested in the other place that the management of the UK shared prosperity fund will involve advisers jointly appointed by the UK and devolved Governments, yet the past few months have shown that this Government do not see themselves as an equal partner to the devolved nations and that they are instead wrongly centralising power to Westminster at the expense of devolution. What guarantees can he give to the devolved nations that they will have a cast-iron equal say on the governance of the UK shared prosperity fund? This is particularly pertinent, given the shocking contempt shown by the Government in trying to railroad through the United Kingdom Internal Market Bill.
The Prime Minister is showing his commitment to the importance of powers for the Scottish and Welsh Governments at this very moment in Brussels, where he is standing up against those bureaucrats who are trying to take powers away from the Welsh Government and the Scottish Government. It is this Conservative party and this Government who are standing up for the devolved settlement, and of course the UK Government will be looking forward to working in partnership with the devolved Administrations around the United Kingdom to ensure that the shared prosperity fund is properly spent.
As well as providing no certainty on the trading arrangements in just three weeks’ time, the Government have also ducked and dived on questions about the funding that Wales will receive in future years. Despite the Tory promise that Wales will not lose a single penny, the actual figures tell a different story. Wales alone was due some £350 million of new money for projects next year, but the Treasury is providing only £220 million for the whole UK. With Wales losing not just pennies but millions of pounds, how can the Government say they have kept their promise?
The Government have kept their promise, because, of course, some of the funding that goes to Wales will still be coming from the European Union after we have left the transition period. If we take the total amount of money that is going to be spent, we will find it is the same. The Government have met their commitment to ensure that the same level of funding is spent in Wales, and we will meet our commitment to ensure that the money is better spent and not wasted, as the Wales Audit Office recently reported on agricultural spending, and is used to level up communities across the whole of Wales.
I am not sure whether that is a conclusive answer, but we are now nearly four and a half years on from the referendum and the Government still cannot provide clear answers on funding, so let me ask the Minister about the criteria on which the funding will be allocated. As he knows, the Welsh Government and local councils have agreed a framework for regional investment in Wales, so can he confirm that his Government will support that framework and not ride roughshod over devolved agreements or make up the spending criteria as they go along?
We are certainly not going to make it up as we go along. Of course, the UK Government have been heavily involved in regional partnerships through the growth deals, which have been working very successfully in Wales as a result of funding from the UK Government. We have already demonstrated our commitment to working in partnership not just with the Welsh Government but with local authorities, because we are absolutely determined that the money that replaces European funding is not wasted, as it has been previously, but is spent on the most needy communities in Wales.
The Government are steadfast in their support for Welsh agriculture, and that is why we have provided the same level of funding for Welsh farmers in 2021-22 as they received in 2019: £337 million a year. That meets our manifesto commitment to guarantee the annual budget for farmers, a commitment that applies for the whole of this Parliament.
We all want to see farmers in Wales and right across the United Kingdom prosper outside the European Union, but how can my hon. Friend ensure that farmers in my Eddisbury constituency will be able to compete with Welsh farmers just over the border who will continue to receive their area payments in the early years of the agricultural transition, whereas all English farmers will see their basic payment scheme payments of £230 per hectare halved by 2024?
As a Government who are committed to the devolved settlement, we obviously will not be telling devolved Governments what they can do with the money; we will simply make sure the money is there. Of course, the United Kingdom Internal Market Bill has been brought forward to make absolutely certain that we do not see a situation where one part of the United Kingdom is able to compete in an unfair fashion with another part of the United Kingdom, and that is why I hope all Members will support that Bill.
My constituency in the Scottish borders is the second-highest recipient of common agricultural policy payments in the United Kingdom. Indeed, four of the top five recipients are in the devolved Administrations. How will the Government support the devolved Administrations with these payments in the future?
I am sure that my hon. Friend’s constituents, like farmers across the whole United Kingdom, are pleased that the British Government will not implement the 10% cut to agricultural payments, which is being brought about by the European Union. He will be pleased that we have used the most generous exchange rate possible to calculate what those payments will be. If he lived in Wales, he would be pleased to know that the UK Government are providing £1.3 billion of additional funding to the Welsh Government, and we look forward to seeing how much of that will be used on agriculture.
Pub Closures: Covid-19
My right hon. Friend the Secretary of State wrote to the First Minister before he announced the closure of pubs in Wales and asked him to consider a tiered structure for covid restrictions, which would have better targeted areas with a high incidence of the virus. Regrettably, at that time the First Minister chose not to do so. I believe he may now be about to follow my right hon. Friend’s advice.
Before the Welsh Labour Government had the bright idea of bringing in a circuit breaker, the infection rate in Wales was 33 per 100,000 head of population. Since then, Wales has had one of the toughest lockdowns. Pubs have to close at six o’clock and they cannot serve alcohol. Infection rates in Wales are now 423 per 100,000. Have Welsh Government Ministers confided in my hon. Friend the reasons for this raging success, and is it perhaps that people in Wales have been so driven to drink with despair that they have to do it at home without social distancing, rather than in pubs?
It is a sad fact that at the moment Wales has the highest number of cases per 100,000 in the UK, the highest number of deaths per 100,000, and the lowest amount of testing, but I do not think my right hon. Friend the Secretary of State and I wish to make any political point out of that. All of the United Kingdom has suffered. What I think we would welcome is a recognition that the Welsh Labour Government do not have some sort of magical answer to this situation which has eluded everybody else. We would welcome Welsh Ministers sitting down and working with the Secretary of State for Health and Social Care and the UK Government, so we can tackle this pandemic together as one nation.
As we have heard, pubs in north Wales have been closed down by the Welsh Government and their trade is being destroyed, despite the fact that infection rates in north Wales are significantly less than in much of south Wales. When my hon. Friend does speak to Welsh Ministers, can he urge them to adopt a more intelligent and nuanced approach to covid restrictions? Otherwise, many of those pubs will never reopen.
As I have just said to my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton), we would welcome the Welsh Government working in tandem with the UK Government to bring in a tiered system, so that in areas with a low incidence of the virus fewer restrictions are put in place. I believe that is an approach the Welsh Government are finally going to adopt. We look forward to sitting down and working with them.
Financial Support: Covid-19
The Government have provided a record amount of support to the Welsh Government, including a funding guarantee of an additional £5 billion this financial year. The Welsh Government will also receive an additional £1.3 billion next year, including £770 million to tackle covid-19.
What further pressure can the Secretary of State bring to bear on Cardiff Bay to ensure that the funding going to the Welsh Government as a consequence of the Barnett consequentials formula finds its way to frontline services and is not absorbed in the bureaucratic costs of the Lib-Lab Government in Cardiff Bay?
My hon. Friend makes a very interesting point, particularly at a time when the Welsh Government are sitting on over £1 billion of unallocated Barnett funding, and so many businesses and institutions in Wales are crying out for support. As the Under-Secretary of State for Wales, my hon. Friend the Member for Monmouth (David T. C. Davies) said, we respect the devolution settlement and it is right that we should. However, if people are concerned, they have an opportunity to change this one-party state at the Senedd elections next May.
The House needs only to look at the £30 million loan we secured for Celsa to see our commitment to Welsh manufacturing industry. We also provided over £2 billion in direct support to businesses in Wales, and our 10-point plan for a green industrial revolution will mobilise £12 billion of Government investment to stimulate manufacturing across the whole of the UK.
The delays in the Brexit deal, alongside the pandemic, have meant that the Welsh steel industry has been hit hard, Airbus has lost 1,400 jobs, Grenadier cars will be produced in France instead of Wales, and even Brains brewery is up for sale. Will the Secretary of State now press the Chancellor for a sector-specific manufacturing strategy, in the knowledge that only UK Governments can borrow in the long term at low interest rates to secure long-term pre-pandemic production levels after the vaccine is deployed and after the deal is agreed?
The Chancellor’s contributions to the companies that the hon. Gentleman mentioned, as well as to Celsa, which I mentioned in my answer, have been second to none. We have had a very good, robust and thorough exchange with all the businesses to which the hon. Gentleman referred. I could not agree with him more that part of the covid recovery programme is there to ensure not only that we get through the next few months but that there are sustainable futures for all those industries, particularly steel. I hope the hon. Gentleman recognises the fact that we were quick off the blocks to rescue Celsa—and 600 to 800 jobs—in that process right at the beginning of the pandemic. That shows beyond reasonable doubt that we are absolutely committed to a steelmaking footprint in Wales.
The Shotton steel plant produces some of the finest quality steel products in the world. The Prime Minister has said that UK steel producers will be
“at the front of the queue”—[Official Report, 24 June 2020; Vol. 677, c. 1311.]
when it comes to future infrastructure projects, so will the Government now set targets on procurement? We need action rather than words—all we tend to get from this Government are warm words. Please, do not just blame Europe; can we have a proper answer?
I am not going to blame Europe—or anybody else, for that matter. I absolutely agree with the hon. Gentleman. We have been making big strides as far as procurement is concerned and, of course, after the end of the transition those strides will be even bigger—that does not constitute blame, of course. We have regular conversations in Government, including with the Welsh Government, about making sure that procurement not only offers value for money for taxpayers but taps into the wonderful supply chain that we have in the UK, of which he gave a very good example.
The Government are unwavering in their commitment to the Union as a social and economic partnership. Its strength is demonstrated by the economic support we have provided to Welsh business during the covid-19 outbreak and by the city and growth deals that help to level up communities across the UK.
Does my right hon. Friend agree that one of the strengths of our Union—our great and united Union—is that we can support and help each other in times of crisis? What support are the UK Government giving to the Welsh Government to help them to fight the pandemic, now that Wales has the second-highest death rate per 100,000 in Europe?
My hon. Friend touches on a current and important point: the Union is not a competition; it is a partnership. I sometimes think it gets portrayed as the former, whereas we all know that it is the latter. The UK Government have been able to introduce numerous financial interventions to assist the Welsh Government in fighting this dreadful pandemic. The most recent is yesterday’s joint letter from the Secretary of State for Health and Social Care to the First Minister saying that where hospitals face real challenges and hardship in Wales, NHS England and the UK Government stand ready to offer whatever support we can and to put down our political differences to make sure that we fight covid as a UK-wide challenge.
The scale of the response to covid in Wales in terms of economic support would never have been possible without the combined strength of our United Kingdom, so will my right hon. Friend emphasise that that strength will help us to ensure that Wales recovers alongside the rest of the United Kingdom as, hopefully, we move on from covid next year?
My right hon. Friend is right. All the businesses in Wales that we have spoken to during the covid crisis have pointed out that they do not recognise political boundaries: they are fiercely Welsh and very patriotic, but they recognise that the economic regions stretch into the far corners of the UK and well beyond. My right hon. Friend is absolutely right that we do make that commitment. Whether or not we are Unionists in the original sense, we are very much on the same page.
Shared Prosperity Fund
My right hon. Friend the Secretary of State has regular discussions with the First Minister and Welsh Ministers on a range of issues, including the UK shared prosperity fund.
Nadolig llawen i chi, Mr Speaker.
We have heard a lot from the Minister about the shared prosperity fund this morning, but I am still none the wiser on the details. What guarantees can the Minister provide that the long-awaited shared prosperity fund will provide no reduction in moneys received by the Welsh Government compared with current structural funding? What guarantees can the Minister provide that it will be the Welsh Government who decide how the money is allocated in Wales?
We have already made the commitment that the amount of money will match everything that came from Europe. Previously, the European Union held the strings and controlled how the money was spent; now, it will be the UK Government working in partnership with local authorities and the Welsh Government to ensure that the money is spent wisely.
The shared prosperity fund will mean more money going into Wales, along with more powers, which will come about as a result of Brexit, going to Wales. We are looking forward to putting our Conservative record before the people of Wales in the elections next May.
If, like the road to hell, this UK Government’s proposals regarding the shared prosperity fund are littered with good intentions, their actions, as with the United Kingdom Internal Market Bill, show that they are most interested in accumulating power to themselves. Please can the Minister explain when exactly we will learn what the mechanism will be for involving the Welsh Government in deciding which people, communities and local businesses will receive the necessary funding to enable them to level up, who will be the final arbiter, how much money will be available and when the process will begin?
We have already said that discussions are ongoing, that the money will be matched, and that the shared prosperity fund will deliver our levelling-up agenda across Wales. The Labour party spent a long time saying that there would not be any money and that there would not be any interest in Wales, but the reality is that we have shown that the money will be there and we want to make sure that it is used properly. Those sorts of arguments might raise a few cheers at Labour party conferences, but the people of Wales will be pleased to know that that money is going to come and that that interest in levelling up the whole of Wales will follow.