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Volume 695: debated on Wednesday 19 May 2021

The Secretary of State was asked—

Connectivity and Infrastructure within Wales and Cross-border

What recent discussions he has had with the Secretary of State for Transport on connectivity and infrastructure within Wales and cross-border. (900090)

What recent discussions he has had with the Secretary of State for Transport on connectivity and infrastructure within Wales and cross-border. (900093)

My hon. Friend the Under-Secretary of State and I have regular discussions with ministerial colleagues about cross-border connectivity and the Union connectivity review.

From the castles of north Wales to the pleasure beach in my constituency, popular tourist attractions across north Wales and the north-west of England will host thousands of visitors this summer as people choose to holiday here in the UK rather than abroad. In order to support tourism and economic growth, it is vital that we strengthen transport links between those regions, so does my right hon. Friend agree that delivering on our manifesto pledge to upgrade the notoriously congested A55 must remain an absolute priority?

I am very grateful to my hon. Friend for raising that question, and he is right. I have visited the area quite a bit recently and seen exactly the challenges ahead. It is a manifesto commitment. We visited with the Transport Secretary. That is very much in our sights, and we hope to have some good news about it in the foreseeable future.

My Italian forefathers always understood the importance of sunshine, sandy beaches and full-bodied, gorgeous ice cream, but for those who live in Dudley, the nearest beach is in Wales, and access is almost mission impossible. What can my right hon. Friend do to improve the wellbeing of my constituents by improving access to these basic rights?

Sadly, we cannot move Dudley, but what we can do is progress the Union connectivity review and strengthen the links. I know my hon. Friend’s part of the world very well. Of course, the cross-border holidaying and other activity between the west midlands and Wales is well known, and we want to improve it. That is exactly what the review is about, because we know that brings not only gratification to the residents of Dudley, but economic prosperity to both areas.

Diolch yn fawr, Llefarydd. The Wales Governance Centre has calculated that, were Wales to be treated like Scotland in relation to HS2 and rail funding, we would be over half a billion pounds better off. Only 1.26% of the firms in the HS2 supply chain are Welsh and we know that, when HS2 is complete, it will take £200 million out of the south Wales economy alone. In the Secretary of State’s opinion, what percentage of HS2 supply chain firms should be based in Wales—or is he happy for his Government to continue to short-change Wales?

I am glad that the right hon. Lady has recognised the relevance of HS2 in shortening journey times; indeed, the journey from her own constituency to London will benefit from the improvements that we are recommending—and that were included in the recent Queen’s Speech, for that matter. There will be shorter journey times, but there will also be numerous opportunities for businesses in Wales to be part of the supply chain, not only in the construction period but thereafter. I hope that what she has actually pointed out is how her party, in her area, is going to warmly embrace that major infrastructure scheme, which will benefit Wales, whichever part of it people live in.

A percentage would be nice, and an increase would be most welcome, given the effect that it will have.

In another area, Welsh-language TV channel S4C has seen a 36% real-terms cut since 2010, and there are now concerns that it will receive a flat cash settlement in the next licence fee round. S4C requires only a modest £10 million per annum of additional investment and the retention of CPI-linked annual increases in licence fee funding to remain competitive with the already advantaged BBC and, essentially, to reach audiences on new digital platforms. Will the Secretary of State work with the Department for Digital, Culture, Media and Sport to ensure additional investment for S4C so that the channel is treated with equivalence to the BBC and, equally or more important, it is viable into the future?

I am grateful to the right hon. Lady for raising the cultural and linguistic significance of S4C, not least because it is headquartered in my constituency. I have a very warm relationship with all the individuals who have been making their case very powerfully to Members across the House in the last few months. I can confirm to her that the Wales Office has of course made some very strong submissions to DCMS. The decision has yet to be made, but I urge her and other colleagues to continue to do that. We recognise the importance of this and we want very much to get to a speedy and correct conclusion.

One of the ways in which the Government could improve transport connectivity is by figuring out what they are doing with their much-lauded levelling-up fund. Given the performance of Business, Energy and Industrial Strategy and Housing, Communities and Local Government Ministers at the BEIS Committee yesterday, which can be described as confused at best—not knowing how the fund will work, how it will be delivered or whether funding will continue into levels 2 and 3—can the Secretary of State confirm that there will be funding available for the second and third funding bids, and that it will be at the same level promised by Ministers just at the beginning of this year? Will he also commit to a further meeting with all Welsh MPs of all parties and MHCLG officials, so that they can clarify the confusing situation for those Members who have more than one county in their constituency and constituents do not lose out on this much-promised money?

Certainly as far as meetings are concerned, I am more than happy to confirm that we will put those in the diary. Whether they are with the MHCLG or others is a matter for discussion. I am very happy to do that; we have done it on a number of issues. I have found that to be quite a constructive and collaborative experience.

As far as the levelling-up fund is concerned, this is, at the end of the day, a good news story. I recognise that there are lessons to be learned from year one, but the levelling-up fund, in whatever shape or form we like to describe it, is here to stay. I am very keen to hear the lessons from the hon. Member, his local authorities and other stakeholders on how we can make it even better than it already is in years two and three.

Manufacturing Industry

The House only needs to look at the £16 million recently given to Meritor in Cwmbran, or the £30 million given to Celsa at the beginning of the pandemic, to see our commitment to Welsh manufacturing. The Government have provided over £11.35 billion in direct and indirect support for businesses in Wales to tackle the pandemic.

The news in recent days that the Serious Fraud Office has launched an investigation into Liberty Steel will be really concerning for workers in Newport and Tredegar, and for all of us who want to see a rescue deal. However, given that global steel production is actually increasing, the industry can clearly be viable and it is, of course, critical to our supply chain infrastructure for so many industries. May I therefore urge the Government to come forward in the next few days with a clear plan and to confirm that they will do whatever it takes, including the option of public ownership, to secure UK domestic steel capacity and the jobs they support, including in my constituency of Warwick and Leamington?

I am sure the hon. Member will understand if I do not get drawn into any questions about Liberty, particularly given the case he mentions, but I hope he will be reassured by the fact that my earlier reference to Celsa—we were able to step in at short notice and help a company for exactly the reasons that he rightly points out—is a demonstration of exactly how committed we are to a sustainable steel industry in Wales.

Way back in 2012, in the good old days, the Conservative-led Government promised to build a western rail link to Heathrow that would benefit not only my Slough constituents, but the many Welsh businesses and families who would have a shorter, more direct route to our major national transport hub. So can the Secretary of State tell us when we can finally expect work to begin on that line? Can he also guarantee that Welsh and other UK steel manufacturers will be at the front of the queue when the line is being built?

I would be a beneficiary of that line, so I am with the hon. Member in terms of our ambition to always try to improve on our infrastructure links. It is good for the economy and particularly good for the supply chain economy, as he rightly points out. Plenty of businesses in Wales could benefit from that. I hope the recent announcement on procurement in the Queen’s Speech will give him and others encouragement that we are taking that extremely seriously.

North Wales is part of an integrated cross-border economy that stretches from Wrexham and Flintshire to my constituency on the banks of the Mersey. Covid-19 has devasted key local manufacturers across the area, including the Vauxhall car plant in Ellesmere Port and many companies located in the Deeside enterprise zone. Can the Secretary of State inform the House what steps the Government are taking to expedite the proposed Mersey Dee Alliance fiscal stimulus package, which will help manufacturers across north-east Wales and the Wirral to build back better and greener in the wake of this terrible pandemic?

I hope I can give the hon. Gentleman some encouragement. We are enthusiastic about the Mersey Dee Alliance and everything it stands for. We are keen to continue to work with it, looking at ways of recognising that the economic area stretches way beyond the geographical borders of Wales and England—we absolutely recognise that point. We are determined to make sure we get further progress and deliver on some of the commitments we made on manufacturing and other industries in Deeside that he referred to.

The Port Talbot and Bridgend area could lend itself fantastically to the establishment of the UK Government’s first freeport in Wales, creating up to 15,000 jobs in the process. Does my right hon. Friend have an update on this initiative in Wales, and can he confirm whether the UK Government will start the freeport process alone if the Welsh Government continue to ignore this fantastic opportunity?

My hon. Friend is right to point out how enthusiastically the freeport scheme has been welcomed across the whole of Wales, and it is a source of some frustration that we have yet to get it over the line. He is right to ask whether we could do that. Clearly, we would like to do it in collaboration with the Welsh Government, which is where the blockage currently resides, but we can and, if necessary, will proceed to deliver on our manifesto commitment come what may.

Trade agreements with other countries can provide new opportunities to promote our excellent Welsh manufacturers around the world, but we must ensure that these deals do not end up undercutting our industries in the process. The Welsh Automotive Forum has said that current trading arrangements between the UK and Europe are leading to disruption to Welsh companies due to new checks on imports and rules of origin, and I have heard that from local companies in Merthyr Tydfil and Rhymney, too. What has the Secretary of State done personally to address this and will he guarantee that Welsh agricultural producers do not lose out from the proposed deal with Australia?

We have regular meetings with the automotive sector, and with stakeholders, the supply chain and others, to try to ascertain exactly what the issues are and how they can be speedily resolved, so we are engaged on that level. As for the rumours about the Australia free trade agreement, I should point out that no deal has been done, but if and when it is done, it will include protections for the agricultural industry and it will not undercut UK farmers or compromise our high standards.

Covid-19: Financial Support

What recent discussions he has had with the Chancellor of the Exchequer on financial support for people in Wales affected by the covid-19 outbreak. (900092)

In the last year, the Government have provided £7.4 billion of additional support through the welfare system for people affected by covid-19, including the £20 a week increase in universal credit. I have regular discussions with my right hon. Friend the Chancellor of the Exchequer about financial support for Wales, and I was able to personally congratulate him a few weeks ago on the outstanding Budget that he delivered for Wales and the UK.

But more than a year has now passed since ExcludedUK was first mentioned in this place and still nothing has been done to support the millions of people across the UK who have seen their livelihoods decimated by the pandemic and who have not received a penny of support from this UK Government. The Secretary of State and the Minister mentions that they have met the Chancellor, but what representations have they made to him on behalf of Welsh people who have been excluded from support by his Government?

In addition to the £7.4 billion of additional support through the welfare system, the UK Government provided the Welsh Government with an extra £8.6 billion-worth of support, and the Welsh Government were free to use that in any way they wished. They were free to give it out to local authorities and allow them to make grants to anyone who had been badly affected, so we completely acknowledge that people have suffered as a result of the pandemic. That is why there was £8.6 billion of support for the Welsh Government, why Welsh businesses received £2.75 billion of support and why we supported 466,000 Welsh workers through the furlough scheme.

Families across Wales will have appreciated the recent easing of covid restrictions, made possible, of course, by First Minister Mark Drakeford’s cautious, evidence-driven approach, but rising concerns about new variants of coronavirus remind us that the pandemic has not gone away. The vast majority of people want to play their part to keep us all safe, but the UK Government’s failure to increase statutory sick pay is forcing many on low incomes to choose between going to work to support their families or staying at home to keep us safe. What pressure can the Minister bring to bear on the Chancellor to put that right?

I am sure that the hon. Lady would acknowledge that Mr Drakeford has been able to work very closely with the UK Government because he has been present at all the Cobra meetings and Welsh Government Ministers have been present at all the ministerial implementation group meetings, very much as part of a joint approach towards tackling the pandemic. The Chancellor and Prime Minister have always been clear that people will suffer as a result of the pandemic. We have not been able to help everyone, but we have, as I said, provided an extra £8.6 billion for the Welsh Government, £2.75 billion for Welsh businesses and supported 466,000 Welsh workers on furlough—plus the mortgage holidays, the cuts in VAT and the cuts in business rates. In Wales alone, we have already created 5,000 extra jobs through the kickstart scheme.

On a different matter, without delving into the chaos of this Government’s foreign travel policy, the reality for many airlines is that this summer will be nowhere near a return to normal. The whole aviation sector faces irreparable harm. We have already seen Welsh jobs lost in the sector and Aerospace Wales has warned that thousands more are on the line. What sector-specific financial support will the Government provide to the aviation industry in Wales to get it through yet another difficult summer and ensure that it has a strong future?

I very much welcome the hon. Lady’s support for the airline industry. Her stated view that we should get people back on to planes and flying around as much as possibly is in stark contrast to the extreme environmental view, which some people in her party seem to take, that nobody should ever get on a plane.

I can assure the hon. Lady that we meet the airline industry regularly; I spoke to the aerospace trade body about 10 days ago and met Airbus online a few days ago. We have not taken up sector-specific support, because the UK Government believe that we should be able to go out there and help all businesses that have been affected by the pandemic. That is why we have already put down £2.7 billion for Welsh businesses, which I hope she will welcome.

Research by the Centre for Progressive Policy has shown that UK Government covid emergency support was, on average, £1,000 more generous to London residents than to those in Wales, and that the UK Government spent nearly £7 billion more on London than if each nation and region of the UK had been allocated the same emergency spending per resident. What explanation has the Minister been given by his Cabinet colleagues for that discrepancy?

The fact of the matter is that the money has gone to those in need in all parts of the United Kingdom. I have already mentioned the £8.75 billion extra that went to the Welsh Government, the £2.7 billion for Welsh businesses and the 466,000 Welsh workers who were supported through the furlough scheme—to be honest, I really welcome these questions, because they give me an opportunity to spell out the huge support that the Government have delivered for Wales. UK-wide, the UK Government have spent £280 billion supporting people across the whole United Kingdom. With the greatest respect to the hon. Gentleman, I do not think that an independent Wales would have been able to manage that level of support.

British Made Goods: Public Sector Contracts

What discussions he has had with the Welsh Government on encouraging the purchasing of British made goods through public sector contracts. (900094)

Last week’s Queen’s Speech announced legislation on procurement that will increase flexibility for contracting authorities and reduce bureaucracy, which will simplify procurement in the public sector and help support British businesses. I very much hope that the Welsh Government will join us in further supporting Welsh companies.

The Minister will be aware that the Department for Transport is spending billions on its programme to decarbonise transport, but it does not seem so interested in building our green manufacturing capacity. Does he share my concern at recent reports of Welsh councils buying green buses not from British firms, but from China? Will he hold urgent discussions with councils, Government and the Transport Secretary in London to demand that taxpayer-funded green subsidies support British industry and British jobs?

I am absolutely delighted that the right hon. Gentleman recognises that this Government are spending billions of pounds on supporting green industries; he is absolutely right. I do not know which specific councils he means, but I know that Newport City Council, a Labour council, recently bought some electric buses; I have no idea where from, but if he has a problem with how the council is conducting procurement, perhaps he would like to discuss it with some of his Labour colleagues. He will certainly know that we have to abide by the World Trade Organisation treaty agreement. I do not suppose that he is advising me to break our international treaty obligations, but if he is, I look forward to hearing more about it.

Strength of the Union: 2021 Senedd Election

What assessment he has made of the effect of the outcome of the 2021 Senedd election on the strength of the Union. (900095)

The results of the recent elections clearly show that a majority of voters in Wales—and in Scotland, actually—voted for pro-Unionist parties. It is clear that voters in Wales want the freedom to study, work, live and travel freely between England and Wales without a border.

Does my hon. Friend agree that, following the elections, and apart from evident self-interest, the Union is ever stronger because of abundant common interest?

My right hon. Friend has been in this House for many years and has a great deal of wisdom. He makes an important point. We are united by a shared love of the Union, our United Kingdom and the firm belief that we are stronger together than apart—[Interruption.]

Fiscal Settlement

This fiscal settlement delivers for Wales. This year, the Welsh Government will receive almost £19 billion of block grant funding, which is £1 billion more than was agreed with the Welsh Labour Government as being a fair settlement for Wales.

The fiscal settlement will not matter all that much if the possible trade deal with Australia goes through with a zero-tariff regime, which would cause serious difficulties for Welsh and, indeed, Scottish farmers. What compensation for those farmers is being built into the fiscal settlement, should this latest gung-ho trade deal scupper their livelihoods?

No trade deal has been signed yet, but yesterday I was on a call with National Farmers Union representatives, who said that they welcomed the principle of a trade deal. They have a few concerns about some of the details, and we will continue our discussions with the NFU and with farmers. But I am surprised at the hon. Lady, who I think was in favour of having a free trade deal with the European Union. Why would she not want to have a free trade deal with a country with which we all—and she and I personally—have very close links indeed?

Economy in Wales: 2021 Senedd Election

If he will make an assessment of the effect of the outcome of the 2021 Senedd election on the economy in Wales. (900099)

The Senedd election has shown that three out of four voters rejected separatism, recognising that our economic prosperity is indelibly linked to being part of the Union.

I am concerned that one of the first priorities of the Welsh Government seems to be a universal basic income. Is my right hon. Friend aware of the debates that I took part in at the Council of Europe, in which the idea was completely rubbished?

I say to my hon. Friend:

“Anybody who thinks this is a good idea should knock some doors of Labour voters in working families. It might sound radical to academics and ‘policy wonks’ but it sounds out of touch if you ask most normal people.”

Those are not my words, but the words of the new Minister for the Economy in the Welsh Government, so it seems that they have a problem in their own ranks, let alone trying to persuade us of the merits of it.

Does the Secretary of State accept that it is Mark Drakeford’s superb stewardship of the Welsh economy and the Welsh NHS that has secured Mark’s overwhelming re-election? Will he welcome the Welsh Labour Government’s new 10-year infrastructure investment plan for a zero-carbon economy and release the promised UK Government funding for the global centre of rail excellence to be built in my Neath constituency?

There were many questions included in that, but I am delighted to have played a part in getting the global centre of rail excellence situated in the hon. Lady’s constituency. That was a Government announcement by the Chancellor in the Budget, and it shows that collaboration can work when we try to achieve these aims. As far as covid reaction is concerned, that has been a team effort and a cross-UK effort. The vaccination programme is probably the clearest indication of why the Union matters and how we have been able to work collaboratively with our colleagues in the Welsh Government to deliver something that genuinely benefits the entire nation.

Discussions with the Welsh Government since 2021 Senedd Election

My right hon. Friend the Prime Minister spoke with the First Minister shortly after the election result. I have extended an invitation to meet the new Minister for the Economy. We have had calls with the First Minister and the Chancellor of the Duchy of Lancaster last week, and another one is due this evening.

The recent elections demonstrated that the vast majority of voters in Wales have no time for independence. They have little time for ripping up the devolution settlement either. What the elections showed is that they want their politicians and Ministers at either end of the M4 to work together to make good things happen for Wales, and to make Wales a stronger and more prosperous part of the UK. Given that the success of the vaccination programme shows that this can be done, what needs to happen now to unblock other important policies such as freeports, which are stuck between the UK and Welsh Governments?

My right hon. Friend is spot on; we have had considerable, really enthusiastic interest in the freeport programme from across the whole of Wales—it will bring 15,000 jobs and it is a manifesto commitment—and the only obstacle standing between us and delivering it is currently the Welsh Government. I am determined to work collaboratively, as we have said before, to get this over the line, and any pressure that anybody in this House can bring to bear to help us achieve that will be very welcome.