Recession (Hansard, 21 January 1991)

§ 4. Mr. Martyn Jones
To ask the Secretary of State for Wales what steps he is taking to ameliorate the effects of the recession on Wales.

§ Mr. David Hunt
The substantial improvements in the Welsh economy in recent years—[Interruption.] The substantial improvements in the Welsh economy in recent years, for which my predecessors and I take full credit, together with our other partners in Wales, mean that Wales is better placed to withstand the present downturn and to resume its successful growth once inflation is under control. I assure the hon. Gentleman that we shall respond swiftly to any opportunities that arise to assist in that process of growth.

§ Mr. Jones
I thank the Secretary of State and I note that for the first part of his answer he did not have a straight face. The deep recession is bound to hit areas such as mine —rural areas—harder and earlier than the rest of the country, as was instanced by the problem with Biddulphs in my constituency, where 50 employees lost their jobs just before Christmas. What will he do in the next few months to help people who lost their jobs at Biddulphs and at other factories and places of work in my area to get back to work?

§ Mr. Hunt
Although Hansard may not show it, I hope that the hon. Gentleman will recognise that I was interrupted by a series of heckles from the Opposition Front Bench which I would not want to repeat. I strongly believe that Wales has benefited enormously in the past few years from increased diversification in its economy. It has moved away from the traditional dependence on a few industries to reliance on a far broader base. In their generous moments, Labour Members will recognise and admit that. Naturally, I am concerned about job losses in Wales, but the real threat to jobs is inflation and the signs are that we are bringing it quickly under control.

§ Mr. Raffan
Does my right hon. Friend agree that nothing would do more to prolong or deepen a recession than the introduction of a statutory minimum wage, as the Labour party proposes? Does he agree that that would lead to the loss of as many as 55,000 jobs in Wales, including at least 1,400 in my constituency?

§ Mr. Hunt
I agree completely with my hon. Friend. In their more serious moments, Opposition Members will acknowledge the decisiveness of the point that he makes. A statutory minimum wage would be a serious blow to Welsh industry.

§ Mrs. Clwyd
Does the Minister agree that, as a result of the Gulf war, the recession will be even deeper than expected? Does he agree, therefore, that there must be an ongoing role for the UN Security Council to bring about a quick solution to this conflict, thereby benefiting the economies of Wales and the third world?

§ Mr. Hunt
I pay tribute to the hon. Lady for managing to introduce the Gulf conflict in a question on Wales. I had hoped that she might pay tribute to the initiative that brought about the Gooding Sanken project at Abercynon in her constituency. I am delighted to announce that in 1990, compared with 1989, when there were 100 inward investment projects, there are 142 inward investment projects, including the project in the hon. Lady's constituency, to which I hope she will have an opportunity to pay tribute.

§ Mr. Simon Coombs
Will my right hon. Friend compare the economic activity in Wales during this so-called recession with that under the previous Labour Government? For example, will he tell us about long-term unemployment during the past five years? Will he tell me what I should say to my constituents in Swindon who lost jobs in factories that moved to south Wales because of the great help that the Government gave to the people in that previously depressed area?

§ Mr. Hunt
One of the best pieces of news to come to Wales recently is the fall in long-term unemployment. If I recall correctly, in January 1986, the number of long-term unemployed was about 78,000. According to the latest statistics, that figure has fallen to just under 23,000. My hon. Friend is right to highlight that fact. We shall continue to broadcast it, just as we shall continue our attempts to attract industries to Wales from whichever part of the country or the world they come.

§ Dr. Marek
The Secretary of State will be aware that the development of the Welsh economy to which he referred is not seen in the Wrexham area, where the Brymbo steelworks recently closed, resulting in 1,200 people losing their well-paid jobs. The county council is seeking to acquire the site for regeneration and redevelopment. If it can agree a sensible sum with United Engineering Steels, will the right hon. Gentleman give that project his blessing and ensure that there is no hindrance from the Department?

§ Mr. Hunt
I hope that the hon. Gentleman recognises that Wrexham and north-east Wales have received a tremendous boost from inward investment, but he is right to point to areas of disappointment. Brymbo's closure was certainly a great disappointment to Wales. I asked the Welsh Development Agency to move in quickly to examine the opportunities for the site and that review is continuing. I hope that any local authority that wishes to advance a project will endeavour to work in partnership not only with other local authorities but with the WDA and the Welsh Office.