§ 4. Mr. Wayne David (Caerphilly)What discussions he has had with the Treasury as to the likely impact of measures recently announced in the Budget to improve the performance of the Welsh economy. [53147]
§ The Secretary of State for Wales (Mr. Paul Murphy)I have regular discussions with my right hon. Friend the Chancellor on a range of issues, including, of course, the Welsh economy. The Budget included a number of measures that will give a boost to the Welsh economy, including a 0 per cent. corporation tax starting rate, a 1 per cent. corporation tax cut for all small firms, research and development tax breaks for larger firms, further simplification of VAT for small firms and other 142 modernising tax reforms. I am also pleased to note that Wales is posting the fastest fall in unemployment of any region or country in the United Kingdom.
§ Mr. DavidI thank my right hon. Friend for his reply. There can be no doubt that the Budget has been a powerful stimulus to the development of the Welsh economy. Unemployment in Wales is indeed at an all—time low, but there are still areas of high unemployment, especially at the heads of the valleys in south Wales. Will my right hon. Friend give an indication and a commitment that the Government will continue to tackle those high rates of unemployment?
§ Mr. MurphyOf course I shall give that commitment. I represent a valley constituency myself and understand what my hon. Friend is saying. He is aware that the Assembly, as well as the Government, is doing its best to regenerate our south Wales valleys. In his constituency, for example, there have been 18 new inward investment projects, creating more than 1,000 jobs and safeguarding more than 100 jobs. The unemployment rate in his constituency has dropped, which is part of the general picture in Wales and means that unemployment in Wales is the lowest that it has been for 27 years— [Interruption.]
§ Mr. SpeakerOrder. I appeal again to the House to come to order. It is far too noisy.
§ Mr. Mark Prisk (Hertford and Stortford)Last Thursday, the Secretary of State told the House that inward investment was vital to the performance of the economy in Wales. Would he, therefore, care to comment on the fact that, as a proportion of the UK total, inward investment in Wales has collapsed from 19 per cent. in 1991 to only 11 per cent. last year? What has gone wrong?
§ Mr. MurphyI remember that the hon. Gentleman took part in the debate on Welsh matters last Thursday. He rightly pointed out the importance of indigenous firms and how they can help to regenerate the Welsh economy. However, I also point out to him that, this very year, the Assembly has the highest level of regional selective assistance grants for seven years; £130 million of RSA has gone into various companies; and 267 investment projects in Wales have benefited from that. There is a combination of two things: we need inward investment and we need to help indigenous industry. That is why, as I said earlier, more people are in work in Wales than at this time last year, despite the loss of manufacturing jobs.
§ Llew Smith (Blaenau Gwent)The Secretary of State will be aware that in Blaenau Gwent we have some of the greatest poverty in Wales, with some of the highest unemployment and the lowest wages. He will also be aware that, in the next few weeks, Corns will finally close. When he meets the First Secretary will he ensure that the public moneys that he has just mentioned, and which are so generous this year, are directed to those areas in Wales where poverty is greatest, and are not lost, as is often the case, in Cardiff in general and Cardiff bay in particular?
§ Mr. MurphyI am very much aware of my hon. Friend's views on these matters. I believe that we can do both in Wales: we can see that the regeneration of our capital city goes ahead, while ensuring that we put proper 143 resources into Blaenau Gwent and the other south Wales valleys. Only a Labour Government, working with a Labour Assembly, can do that.