HC Deb 31 March 1999 vol 328 cc1073-5
2. Miss Julie Kirkbride (Bromsgrove)

If he will make a statement about recent job losses in Wales. [78060]

The Parliamentary Under-Secretary of State for Wales (Mr. Peter Hain)

Although recent job losses in manufacturing in Wales are extremely regrettable, overall the Welsh economy continues to grow, and last year Wales had a net gain of 21,000 jobs.

Miss Kirkbride

Has there not been a turnaround in the number of jobs being created and lost in Wales? Is not part of the problem the fact that the Government have introduced the minimum wage and adopted the working time regulations? This afternoon, the House will hear more about regulations to be imposed in relation to family crisis leave and parental leave. Every employer and federation agrees that all those things add costs, burdens and regulations to business. They are unwelcome and will add to the problem in the Principality of a lack of employment and job opportunities.

Mr. Hain

I cannot blame the hon. Lady for being out of touch with business opinion in Wales, but she is. Business in Wales enthusiastically welcomes the Government's policies and is working in partnership with us to support our initiatives.

I am pleased to be able to announce three new schemes to assist small businesses in Wales, many of which were decimated by Tory Governments. The first is a £2 million Welsh Development Agency small loans fund. The second is a £2 million British steel industry small equity packages and loans fund. The third is a £6 million WDA and National Westminster bank venture capital fund to finance innovative developments that focus on new technology. We are supporting businesses in Wales—just as the Tories destroyed their prospects.

Mr. Denzil Davies (Llanelli)

Is my hon. Friend aware that in the 36 months to February, unemployment in Llanelli fell by 25 per cent., and by about the same amount in neighbouring constituencies? However, in the 12 months to February, the drop has been minuscule in Llanelli, while in surrounding constituencies, including the Minister's own, there has been an increase. Does this not show that manufacturing industry is beginning to feel the pressure of recession and contraction? Will the Welsh Office make urgent representations to the Bank of England to seek a further substantial reduction in interest rates to reduce the pressure?

Mr. Hain

My right hon. Friend is correct. However, unemployment under the Labour Government has fallen to the lowest levels in living memory. At least a quarter of the world is in recession and world growth has halved. Our manufacturers are having a difficult time, but the Government are supporting them in every way possible. There was a net growth of 21,000 jobs last year, despite the fact that most of the world is in a difficult economic situation.

Mr. Richard Livsey (Brecon and Radnorshire)

I am sure that the Minister is as concerned as I am by the loss of manufacturing jobs. On his recent visit to the United States of America, was the Secretary of State able to persuade a manufacturing investor to come on to the site at Ystradgynlais, where, in April, 750 people will lose their jobs at the largest manufacturing plant in my constituency? Would the Minister visit the plant with me to give some hope to employees who are reaching the end of their tether?

Mr. Hain

I have visited the plant recently, and I have been in close contact with the stewards. I have also been responsible for setting up a task force that is carrying through a nine-point action plan to provide alternative job and training opportunities. The Lucas workers suffered a grievous blow when their jobs were withdrawn at very short notice, but we are working to increase investment in the Swansea valley. We were able to announce 500 more high-tech, high quality jobs at the bottom of the valley last year. We have raised the future of the site with the owners, TRW and Lucas, in conversations in America and here.

Mr. Alan Williams (Swansea, West)

Is my hon. Friend as surprised as I am that unemployment in Wales has at last been discovered by the Conservatives? Does he, like me, regret the fact that it was not discovered 20 years earlier? Given the prospect of job losses in west Wales, can the Minister assure us that the resources needed in Wales will be made available so that we may exploit the advantages of the welcome introduction of objective 1 status, on which the Welsh Office is to be congratulated?

Mr. Hain

My right hon. Friend is absolutely right. There is selective amnesia on the Tory Benches about the devastating impact of Tory policies on jobs and businesses in Wales. We are driving forward new job opportunities in the Swansea area. Only yesterday, the Secretary of State announced an initiative supporting Visteon in safeguarding and protecting hundreds of jobs in the area. We are also working with the Swansea Bay partnership and others to assist south-west Wales. I am confident that Wales will be able to draw down the funds that it needs under objective 1 status, which has been admirably won by the leadership of the Labour Government.