Public Spending Review (Hansard, 12 June 1995)

§ 4. Mr. Jenkin
To ask the Secretary of State for Wales who in his Department is responsible for the Government's fundamental review of public spending; and if he will make a statement. [26034]

§ Mr. Redwood
I am responsible for reviewing public spending in Wales and for reporting on it to the House. I have especially concentrated on reducing overheads in the Welsh Office and in quangos. Any conclusions from general UK reviews will be incorporated in Wales where appropriate.

§ Mr. Jenkin
I thank my right hon. Friend for putting himself in charge—unlike in some Departments, where officials are expected to take a lead. Does my right hon. Friend agree that control of public expenditure has gone hand in hand with a dramatic revival of the Wales economy? Would not Labour's determination to increase public expenditure put that revival at risk?

§ Mr. Redwood
Yes. Of course unreasonable increases in public expenditure would threaten the recovery. It would mean borrowing too much, which would force up interest rates and damage business, or taxing too much, which would also damage business—or a combination of the two. That is exactly why some Labour Members are now extremely shy about saying that they believe in more public spending, while others—as we well know—are full of plans to spend more. Meantime, I am pleased to say that the overheads of the Countryside Council for Wales and of the Welsh Office are this year coming down by almost £2 million and £1.7 million respectively. The overheads of the Welsh Development Agency will be £1.9 million lower than two years ago.

§ Mr. Ray Powell
As the Secretary of State is responsible for those estimates, I wonder whether he is responsible for his statement to the Tory party conference at the weekend suggesting £100 million expenditure by Labour on a Welsh Assembly. Will the right hon. Gentleman explain to the House, nation and Principality how he came to assume that figure?

§ Mr. Redwood
The hon. Gentleman will have to contain his excitement. I am completing my estimate of the likely cost of such an assembly and will release it shortly. I made no statement at the Conservative conference—although occasionally there is inspired journalism in Wales. I suspect that the figure will not be far from that rumoured, but I have not yet completed my estimate. I shall release it shortly.

§ Mr. Sweeney
In welcoming the expenditure reductions achieved by my right hon. Friend, may I ask him what steps he is taking to reduce administration costs in the health service, so that the maximum money can be spent on patient care?

§ Mr. Redwood
As my hon. Friend may know, we are about to lower the number of health authorities from 17 to five, which will make a material reduction in the health administrative overhead at health authority level. We are now seeing fruits from the changes that I introduced to recruitment procedures for administration and management in general, which will be welcomed on both sides of the House. I have also taken a particular interest in consultancy expenditure throughout the Welsh Office, which has fallen from £1.45 million the previous year to £800,000. If we manage to keep up the pressure, I hope that that figure will reduce further.

§ Mr. Wigley
Instead of kow-towing to every planted, uninspired question from every sioni siencyn on the Government Benches, will the Secretary of State put time into getting his figures right in respect of spurious estimates, such as that for a Welsh Parliament? Does the right hon. Gentleman realise that the cost of running both Chambers of the Irish Parliament this year will be £28 million and that the New Zealand Parliament costs £40 million a year? If that is the extent of the understanding of figures in the Welsh Office, is it not a good explanation of why the Government's financial controls are out of sync and unacceptable to the people of these islands?

§ Mr. Redwood
The hon. Gentleman will have to wait for my forecast. I shall set out exactly how it was compiled, so that the people of Wales can reach their own judgment on whether I have underdone it or overdone it.

§ Mr. Ron Davies
I refer the Secretary of State to recent remarks by the former Prime Minister, Lady Thatcher, in which she criticised the Government for failing to control public expenditure and for being the highest taxing Government since the war. Is that not another demonstration of how hopelessly split the Conservative party is? As its leaders no longer have confidence in each other, why on earth should the country have confidence in them? Lady Thatcher claims that she still has supporters in the Cabinet. Why does the Secretary of State not have the honesty to admit that he is one of them—or does he still profess loyalty to the present Prime Minister?

§ Mr. Redwood
Of course I support the present Prime Minister, and I am pleased that the Government are setting out to reduce public expenditure as a proportion of gross national product—in a way that is painful to the Labour party, because it means that we shall be able to deliver our promises to start lowering taxation while producing high-quality public services. The economy is now growing, which is, of course, the secret of success.