HC Deb 19 January 1987 vol 108 cc587-8
5. Mr. Gareth Wardell

asked the Secretary of State for Wales what is his current estimate of the percentage of the working population of Wales residing in intermediate areas; and what was the corresponding figure for 1979.

Mr. Nicholas Edwards

Fifty-one per cent. of the economically active population of Wales live in intermediate areas. The corresponding figure for early 1979 was approximately 13 per cent.

Mr. Wardell

While I accept from the Secretary of State's figures that there has been an expansion in the population of Wales living in intermediate areas, does he agree that at the same time he has drastically reduced from 90 to 38 per cent. the proportion of the working population who live in assisted areas receiving regional development grants? Is he really proud of the fact that from April this year a moratorium of two months will be imposed on the payment of regional development grants? The Government are once again increasing the divide between north and south, with Wales firmly in the north.

Mr. Edwards

On the moratorium, we have been faced with a considerable bulge in the number of applications. There was an overlap on the two schemes and there has been a four-month moratorium under the old scheme and there will be a two-month moratorium under the new scheme. In each of the years 1984, 1985, and 1986 the estimated number of new jobs created following acceptance of regional selective assistance and regional development grants in Wales was well over 12,000. In 1986 the figure was more than 16,000. That compares with the 1979 figure of under 10,000. It is clear that the Government's regional policy is creating more new jobs than were created by that followed by the previous Labour Government.

Sir Anthony Meyer

Does my right hon. Friend accept that the insistence of the Treasury on thinking of things solely in 12-month periods is positively unhelpful to his tremendous efforts to create a consistent, long-term development policy for the Principality?

Mr. Edwards

We have had a very considerable bulge in applications. We have been dealing with record figures for jobs created by our regional policy. During 1986 no fewer than 135 offers of assistance totalling more than £37.5 million were expected, promising to create more than 5,400 new jobs and to safeguard 4,000 existing jobs in Wales. These figures show that within the flexibility that we have—and we have a three-year PESC period—we are able to pursue a very effective regional policy, not least in the area of Wales represented by my hon. Friend the Member for Clwyd, North-West (Sir A. Meyer).

Mr. Wigley

Is the Secretary of State aware that the whole of my constituency is an intermediate area and that the Pwllheli employment exchange shows for this month an unemployment rate of 22.2 per cent. compared with an average of 19.1 per cent. for the full development areas throughout Great Britain? Is it not high time that the Secretary of State either looked again at the designation of intermediate areas or came forward with a much more effective regional policy?

Mr. Edwards

Any regional policy must have a degree of consistency. We have had a major review and we should not change the boundaries of areas every few months or every year or so. The hon. Gentleman must recognise that the scope for giving selective assistance in the intermediate areas is considerable. When significant projects have been brought forward, it has nearly always been possible to put together a financial package to enable us to secure them. As the hon. Gentleman knows, his constituency is faced with problems of location and infrastructure. Possibly the greatest single contribution that we are making in the hon. Gentleman's part of Wales is the rapid progress towards completing the A55 dualling.

Sir Raymond Gower

Can my right hon. Friend assure the House that the package which the Welsh Office, the Welsh Development Agency and Winvest are able to offer industrialists who are considering moving into Wales has proved adequate since the boundaries for grants were last altered?

Mr. Edwards

The fact that we have attracted about 20 per cent. of all inward investment into the United Kingdom, when we have about 7 per cent. of the population, shows that Wales is getting a very fair share. One threat that is hanging over that inward investment is the Labour party's promise to reintroduce exchange controls. I cannot think of a more devastating blow to job and investment prospects for Wales, as it would immediately halt inward investment and have a devastating impact on decisions made by overseas companies which have major plants here and are planning expansion.

Mr. Anderson

When the Secretary of State talks about fair shares for Wales and the effectiveness of regional policy, would he care to read today's Financial Times supplement on regional policy, which speaks of the collapse of such a policy under this Government and says, among other things, that the increase in unemployment in Wales while the right hon. Gentleman has been in office is double that in Northern Ireland? Is that the legacy that the right hon. Gentleman will proudly leave Wales?

Mr. Edwards

Unemployment in Wales has fallen in eight of the past nine months. The number of people unemployed in December was about 10,500 down on the peak of March last year and we have an all-time record allocation of Government factories at only just under 2.5 million sq ft. That shows the complete nonsense of describing our policies as a failure.