HC Deb 17 July 1989 vol 157 cc4-6
3. Mr. Alan W. Williams

To ask the Secretary of State for Wales if there are any plans under consideration for the privatisation of part or all of the functions of the Welsh Development Agency.

Mr. Peter Walker

The agency has constantly reviewed the scope for increasing private sector involvement in the range of its activities, in accordance with its statutory responsibilities and the policy guidelines laid down by the Government. Accordingly, over the past year—as in previous years—it has sold assets worth some £12.5 million to private sector interests. It has also contracted out its legal, press and information services and it has announced an intention to seek the adoption of utility services by the statutory providers on a number of its estates.

Mr. Williams

May I express my anxiety about the circumstances surrounding the suspension of the two officers who have been removed from west Wales? Were not those two men guilty simply of jumping the gun and making public proposals that the agency is considering in a larger way? Will the Secretary of State confirm whether there have been detailed discussions between the WDA and Barclays de Zoete Wedd Ltd., the merchant bank arm of Barclays bank? There have been tremendous comings and goings during the past six months. Will he confirm that the agenda includes hiving off services, more private funding—with perhaps a 50–50 public-private structure—and possibly even outright privatisation?

Mr. Walker

No, Sir. The proposals of the two officials were for a straight management buy-out of the services and assets operating in one region of the WDA. There are constant examinations with, I would guess, all sorts of advisers about gearing up the money coming into the WDA from the private sector. If successful proposals and suggestions were put forward, I expect that the hon. Gentleman would warmly welcome them.

The WDA is an important agency, carrying out enourmously important functions. If the main desire was to see that it was sold off to somebody quickly, there would not have been the enormous increase in activity that there has been during the past two years. The hon. Gentleman is totally wrong. If there are any ways in which we can bring more money into Wales by gearing up the activities of the WDA, I hope that hon. Members of all parties will welcome them.

Sir Anthony Meyer

Is it not all too typical of the hon. Member for Carmarthen (Mr. Williams) that he is fussing about the structure and ownership of the organisation when what really matters are its functions and activities and that it should continue to attract industry to Wales and to promote industrial development within Wales?

Mr. Walker

During the next few years, the WDA is committed to firm programmes with a considerable dimension, including the biggest-ever derelict land clearance programmes, and the biggest-ever advanced factory building programmes, and we must not forget the range of services that it is providing at present. As I said in answer to an earlier question, in the coming year alone we shall be spending more money on the WDA than was spent during the previous Labour Government's entire period of office.

Mr. Coleman

I welcome what the right hon. Gentleman said about the security of the Welsh Development Agency, but will he go a little further? On behalf of the Conservative party and Conservative Members, will he now recant their actions which, had they succeeded, would have prevented the setting up of the Welsh Development Agency, in which the right hon. Gentleman now takes so much pride and pleasure?

Mr. Walker

I have been the biggest user of the Welsh Development Agency of any Secretary of State since it was started, so the hon. Gentleman should enthusiastically support the manner in which I have given it a considerably expanding role and a new dynamism which never attained under the Labour Government.

Mr. Gwilym Jones

Does my right hon. Friend agree that there is nothing wrong with employees of an organisation such as the WDA making suggestions about what could be better privatised? Such employees may be well placed to offer their employers advice on those matters. May I urge my right hon. Friend, if necessary, to continue to examine all such proposals on the basis of what is best for the achievement of the WDA's objectives and for the taxpayer who has to pay the bill, rather than following dogma for dogma's sake?

Mr. Walker

I knew nothing of those proposals until they were announced by the press. Officials of the WDA knew of them and had rejected them, and a number of my officials knew that the rejection had taken place. The proposals were firmly rejected at an early stage there was great surprise in the WDA and the Welsh Office that such proposals were eventually made.

Mr. Barry Jones

If the right hon. Gentleman did not know, he should have known. He has given us wriggling answers. Is it not the case that the two west Wales officials simply jumped the gun by making public a proposal that the WDA was examining in a wider way? Does that explain why the WDA finance director spent time with the privatised National Freight Corporation? Will the Secretary of State explain those matters?

Mr. Walker

The WDA is perfectly free to explore any ways of bringing more private capital into its activities. I see nothing wrong with that. I should be surprised if it was the Labour party view that the WDA should refuse gearing or additional investment for Wales on the grounds that it was tainted because it came from private enterprise. The only proposals for the WDA involve continuing its present activities. The proposals made by the two men to whom the hon. Member for Alyn and Deeside (Mr. Jones) referred had nothing to do with the sort of proposals that the WDA had been examining.