HC Deb 07 February 1983 vol 36 cc614-5
4. Mr. Wigley

asked the Secretary of State for Wales whether he proposes to make any changes to the guidelines issued by him to the Welsh Development Agency; and if he is satisfied with the performance of that agency.

Mr. Nicholas Edwards

New guidelines have recently been issued covering the agency's land reclamation function, and a copy is available in the Library. I do not propose to make any major changes in the guidelines for the agency's other main functions at the moment, although this is kept under review. I am satisfied with the agency's achievements to date, but I am having discussions with the recently appointed chairman and the board about its future strategy.

Mr. Wigley

Does the Secretary of State accept that, if any of the guidelines are to be changed, it is those for the creation of new jobs in Wales that should be changed? That is where the most patent failure of the agency is evident. Is he not aware of the consultants' report—the Larsen Sweeney report—which was published a few months ago, which referred to the Welsh Development Agency as being the subject of anecdotal amusement? Does not the right hon. Gentleman feel that there is something drastically wrong, which needs to be put right?

Mr. Edwards

It is not just to say that the performance of the WDA is the subject of amusement when, since it was set up, it has constructed about 8 million sq ft of factory space, 5 million of it under the Conservative Government, and has occupied much of that factory space in the middle of a recession. There is a change in future strategy. There has been a sharp increase in the approved investment portfolio from £10.5 million to £15 million during the recent past. It is developing the investment activities of Hafren, its new investment subsidiary. The new chairman is carrying out an urgent review of its strategy with the board. I am about to have a meeting with the board to discuss its future policy.

Mr. Tom Ellis

Does the Secretary of State recall that last May he told the House that he had asked the agency to reconsider its long-term strategy? Has the agency now embarked on a new course? If so, in what direction is it going?

Mr. Edwards

Since then, Hafren has been established and there has been an upturn in the investment porfolio. A new strategy document was prepared, but the former chairman, Mr. Stephen Gray, died during the preparation of the report. I thought it right to allow the new chairman time to consider the report before meeting the board, which I intend to do within the next couple of weeks.

Sir Anthony Meyer

Is it not true that the best hope for jobs in Wales lies increasingly not so much in manufacturing as in service industries? Should not that fact be reflected in the guidelines that are given to the WDA? Might not such tourist projects as a theatre in Rhyl, in which the WDA should begin to interest itself, be taken into account?

Mr. Edwards

The present guidelines give a good deal of flexibility to the agency. It can support non-manufacturing industries. I agree that there should be a proper balance, and I am seeking to achieve it. The Rhyl sun centre is an example of how a service project can give substantial job opportunities to the area. We want to have a proper mix in every part of Wales.

Mr. Barry Jones

Does the Secretary of State agree that to achieve its finest potential the agency would require the Government to reflate the economy drastically, albeit in a controlled way? May I remind the Secretary of State that in Clwyd and Gwynedd manufacturing jobs in the pipeline over the next four years total only 3,750? When does he think there may be news of the Finnish pulp paper mill at Shotton?

Mr. Edwards

I believe that we shall have a decision on that matter before much longer. I am sure that the hon. Gentleman will welcome the recent annnouncement by the Welsh Development Agency of a £6 million-plus reclamation project in the area. Whatever the hon. Gentleman's views of reflation, most people in industry would think that low interest rates and the keeping down of industries' costs are perhaps rather more important for future job creation.