With permission, Mr. Speaker, I should like to make a statement on the valleys programme.
I have today published a programme for the south Wales valleys. Copies of the programme document have been placed in the Library of the House and the Vote Office.
I would like to thank the local authorities, the Welsh Development Agency, the Wales Tourist Board, the Training Commission, the public utilities, the health authorities, the CBI, the Welsh TUC, the voluntary organisations and the industrialists and business men who have been consulted to produce a comprehensive programme—[interruption]—a programme that will significantly improve the economy and the quality of life in the Valleys over the next few years.
In recent years many new factories have been built and occupied. Inward investment has been attracted, many thousands of homes have been improved, and many acres of derelict land have been cleared.
The objective of the programme is to accelerate these improvements to create a viable and diverse economy, and to create conditions that provide a good quality of life for the people of the valleys.
Over several decades the decline in the numbers employed in the coal and steel industries has created high levels of unemployment. These industries have also left serious dereliction which we are now tackling.
The programme I have announced is without parallel in the history of the valleys—a 15-point programme for new and small businesses which includes two new loan schemes, new training schemes and a new technology development fund. A new quality and design centre will be established. This will serve all Wales, but be based in the valleys.
The Welsh Development Agency's advance factory and workshop building programme will be trebled. Advance factories, together with special purpose factories, and around 140 new workshop units will in combination provide by far the biggest factory building programe in the history of the valleys. A new business centre and WDA regional office will be created at Merthyr Tydfil.
Regional assistance in the financial year 1988–89 will he more than a third up on the previous year. I am delighted to tell the House that, in the 15 months ending 31 March this year, 1,333 applications were received for regional development grants in the valleys. The applications represent an investment of £620 million creating 23,460 new jobs. Some of these applications might be rejected and others not fulfilled. What is certain is that the valleys are involved in an unprecedented level of industrial investment.
The levels of Government aid envisaged over the next three years would on past experience create over £1 billion of private investment and 25,000 to 30,000 additional jobs.
The Training Commission, which I have consulted, intends to spend an average of £1 million per week over the next three years on training and educational programmes in the valleys. We intend to create in each and every valley new and close links between the schools and commerce and industry.
The Welsh Development Agency will treble its programmes to provide education advice and enterprise training for those in the valleys who wish to become self-employed and create new businesses.
A new drive will be made for the tourist industry. Apart from the substantial investment in the Ebbw Vale garden festival, we will proceed with the development of the Rhondda heritage park and many other developments. The private sector will be investing heavily in the tourist industries, and two major firms alone intend to invest £40 million over the next three years. Action will be taken to create a number of excellent venues in the valleys for music and the arts.
Expenditure on the clearance of derelict land in 1988–89 will be 50 per cent. more than last year, and £42·5 million will be spent over the full three years in the biggest derelict land clearance programme in the history of the valleys. A wide range of schemes will be provided for improving shopping centres and retailing. A range of further investments will be made in hospitals and health centres, and schemes will be pursued to assist the elderly particularly, and to improve primary health care.
In housing, we hope to increase substantially the number of house improvements under enveloping schemes, to increase the activities of the housing associations and to double the number of private sector new housing starts over the next three years. Altogether 32,000 houses should be improved and more than 10,000 new homes built over the next three years.
This is a programme that will bring substantial improvements to the economy, the environment and the quality of life in the valleys—a programme that contains within it the largest derelict land clearance programmes, factory building programmes, training programmes and', boost to tourism in the history of the valleys. It is also a programme that will bring about a further substantial improvement in the quality of health care, and that recognises the strong community and cultural tradition of the valleys. It is a programme that will provide a fine foundation for future activity—a foundation that will give the people of the valleys an opportunity to see that their efforts, enthusiasm and enterprise will result in a strong economy and good quality of life with which to enter the next century.
May I thank the Secretary of State for making this statement, rather belatedly, and regret that it was not made here in the House before he had his press conference this morning in Wales?
May I also say that we all want more resources and a solution to the problems of the valleys, but that having looked at the press releases that the Secretary of State issued today, I feel that most seem to be a combination of the ancient, the inadequate and the irrelevant? Does the right hon. Gentleman agree with the diagnosis that we are talking about an area of unusual poverty, an abnormally high incidence of ill health, abnormal unemployment and desperately inadequate housing?
Will he confirm that the £500 million that the Government have announced for the next three years for this area of severe deprivation is the same amount that the Porsche-driving yuppies of the south-east will receive every six months as a result of the Chancellor's Budget? Will he also confirm that £250 million of this money is merely giving back to the valleys money that was stolen from them in the alteration of the rate support grant under the present Administration?
Does the Secretary of State remember his own Department's report—he should, as it is only a couple of weeks old—which showed that £400 million is needed for house repairs and renovation alone in these areas, that one in 10 houses in Mid Glamorgan are unfit, and that in the Cynon valley as many as one in six are unfit? Against that massive £400 million need, how does the right hon. Gentleman justify a mere £8 million extra for house repairs in this announcement? Will he confirm that, even taken with the £20 million already announced for enveloping for the valleys, the total house repair finance that he is providing is well below the £40 million that the brewers are providing for pub restoration in the valleys of Wales? Will he confirm that the two companies that he is talking about which are about to invest £40 million in the valleys are the brewers?
May I tell the right hon. Gentleman that I welcome the refurbishment of the miners' institutes? At least that will give a pleasant surrounding for the miners whom he has made redundant to sit and contemplate their continuing unemployment. Does he recollect his boast in The Observerthat he obtained every penny that he asked for from the Cabinet? Will he tell us whether in this package there is any new money at all from the Government for Wales? If so, how much? If not, why not? Did he ask for it, or did he not? If he did not, why not? If he did, what happened?
Will the right hon. Gentleman confirm that, although he claims to have had every penny he asked for, he did not obtain any money at all for the new hospital for Mid Glamorgan, which is desperately needed in an area with the second highest mortality rates in the United Kingdom and with the highest percentage of the permanently sick?
I welcome, as I am sure do all hon. Members, the new WDA factories. Will the Secretary of State confirm that the WDA formula of three jobs for every 1,000 sq ft of factory space will provide fewer than 4,000 jobs in an area with more than 40,000 unemployed?
Does the right hon. Gentleman agree also that the increased applications for regional development grants, to which he referred and about which he boasts, are actually the result of a panic rush to beat the deadline for the abolition of regional development grants on 31 March and that some of them have been made as insurance applications and many of them will never take place? Alternatively, is he saying that he now is so convinced of the effectiveness of the regional development grant that he has come here today to announce that he intends to restore it?
I have seen reports in the press that the Secretary of State hopes to cut unemployment in the valleys by 26,000. Is that a firm target? Is it a target that he is willing to state here today? Is he willing to stand by its achievements?
No wonder there was virtually not a murmur from the Opposition Benches when the right hon. Member for Swansea, West (Mr. Williams) sat down. For a representative of the Labour party whose Members represent the valleys to greet a programme of this scale and dimension in that way was quite a remarkable performance.
Taking the items that the right hon. Gentleman has mentioned, with regard to house improvements in the valleys, yes, the housing conditions are very bad. They were very bad in 1979, when this Government came to power. The reality is that, in one year, this Government improved more houses than in the whole five years of a Labour Government. How remarkable it is that now we announce that we are going to improve another 32,000 houses, the right hon. Gentleman says that that is not enough.
The £500 million to which the right hon. Gentleman referred is not the totality of public expenditure. Public expenditure in the valleys—aside from the £500 million—on education, health and local government services, is £50 per week per household, quite apart from the £500 million on the specific items that I have mentioned today.
This is the biggest factory building programme—to which the right hon. Gentleman says, "But it provides only 4,000 new jobs." That is the WDA factory building programme. A massive factory building programme will take place as a result of the enormous investment taking place. In that programme, I mentioned just 11 companies, none of them brewing companies, in the valleys.
In the next three years, 11 valley companies will invest £200 million in capital investment. As a result of the Government's decision, we therefore have the biggest ever derelict land clearance programme; the biggest ever factory building programme; the biggest ever total of applications for regional assistance; and an enormous programme for house improvement. If the Labour party does not greet that, the people of the valleys will.
The people of Wales will be saddened, but in no way surprised, by the mean-spirited and pettifogging response by the right hon. Member for Swansea, West (Mr. Willliams) to this most imaginative and far-reaching proposal which has brought fresh hope to the people of south Wales. If the information is available, will my hon. Friend say how much money is being made available for industrial expansion and economic recovery?
Now that my right hon. Friend has set south Wales firmly back on the road to economic recovery, will he pay some attention to the problems of small but obstinate areas of dereliction and industrial decay in north Wales, particularly in the west end of Rhyl in my constituency?
The derelict land clearance programmes and the urban renewal programmes will take place throughout the Principality, including north Wales. Over three years, £500 million will be spent on schemes which can be described as having a direct economic impact—the urban aid programme, Government grants for regional assistance, the factory building programme and the derelict land clearance programme. That works out at £1,900 for each household in the valleys or £13,500 for each person currently unemployed.
After the 15 years that I have had the privilege of representing a Welsh constituency, as a Liberal, I believe that we are honourbound as politicians to say thank you now and again to the Secretary of State for Wales, whether he is a Socialist or a Conservative; and over the years I have done just that. I welcome this initiative for south Wales as a step in the right direction, although it may be long overdue and the present aid may be insufficient. Will the Secretary of State assure the Welsh people and those responsible for this initiative in the valleys that, if the scheme goes well during the next two years, he will give extra financial aid to those responsible? The state of Welsh language and culture causes great anxiety to many of us in Wales. Can the Secretary of State give an assurance that he will make a proviso to look after those interests?
I am grateful to the hon. Gentleman for his remarks. I believe that in the valleys, people of every political persuasion will be pleased with the dimensions of the programme. More needs to be done through the educational system and elsewhere to encourage the Welsh language and culture. When the hon. Gentleman examines the detail of the programme, he will see that one of the exciting developments is for six major buildings in the valleys which will become important locations for the performance of music and the arts, which are important to valley communities.
The problems of the valleys are of considerable dimensions. It will take time to change the area, which has faced difficulties, dereliction, unemployment, and a lack of training for the diverse economy that is now developing, into an active successful commercial area. I shall always endeavour to take decisions to invest in doing just that.
Like other Conservative Members, I was astonished at the sour reaction of the Labour party to the announcement of this initiative, which will certainly bring fresh vigour to those living in the valleys. When, in 1970, I stood as a candidate in Islwyn, the people of that district never dreamt of opportunities like this, but I suppose that it was not surprising, when they had been in the total grip of the Labour party for so long, that the future looked completely bleak.
I am grateful to my hon. Friend. I made the announcement in the valleys because I wanted to make it to the people of the valleys. In all my consultations and talks, local authority leaders, many of whom are of the opposite persuasion, were completely collaborative. I am sure that they will welcome many of these proposals.
I am the first valley Member of Parliament to speak on this statement. I listened with interest to the Secretary of State boasting about these home improvement moneys and the great burst of effort in one year, which he described as involving far more investment than ever before. Why is the Secretary of State now turning off the tap? It is acknowledged in the report that owner-occupation has increased from 59 per cent. to 66 per cent. My constituency has the highest owner-occupation rate in the United Kingdom, which is about 79 to 80 per cent. There are 18,000 houses that are substandard and need improvement grants. The report is not enough. More is needed in this vital area.
The valley people are a proud people. We have a culture, a tradition and a structure which is specially ours. People want to stay in the valleys, which is why they are purchasing their homes, but they need help. Why is the Secretary of State not investing money to give help in that area?
This morning, one of my pleasant tasks was to open a new housing development in the constituency of the hon. Member for Rhonda (Mr. Rogers). I am glad to say that, during that ceremony, the people involved announced that they intended to embark upon two similar projects in the valleys.
As regards housing, the enveloping schemes have been extremely successful and within the next three years we intend substantially to increase such schemes. Our target for improvement is 32,000 more houses. That will mean that, since this Government came to power, 77,000 houses will be improved in the valleys—that is, approaching one in three of all homes. It is, of course, an important programme. Apart from housing, I know that the hon. Gentleman will be delighted at the decision on the Rhondda heritage park and the fact that in the coming year land reclamation in the Rhonda will be worth £1 million and that £650,000 of factory building will take place.
My right hon. Friend will be aware that much of the success of the scheme depends upon the response from the south Wales valleys. I was born in south Wales and spent most of my life there, and I urge my right hon. Friend to adopt initiatives to encourage skills and self-employment in the valleys.
The Training Commission will spend £1 million a week in the valleys in the next three years. I am also pleased to say that the advice and assistance given by the WDA to those who wish to become self employed and start their own business will be trebled in that period. There is a 15-point programme to encourage small businesses in the valleys.
I am pleased to note that the report in The Guardianof this morning concerning the area of the initiative—a band from Gwent in the east to Afan in the west—has proved to be unfounded. Frankly, if that hand had obtained, it would have been a disaster because it would have left out the most important valleys. What projects will the money attract? Will it mean that the road improvement schemes in the Neath and the Swansea valleys will be expedited? Will the geological conditions that have caused such trouble in places such as Panteg in the Swansea valley, also qualify for funding by the initiatives?
With regard to funding schemes, it should be noted that the urban development programme will be increased by 38 per cent. We shall consider all the projects and applications to that programme carefully and objectively to get the best value for money. There will be a substantial increase in such urban development activities.
Obviously, I am delighted that the hon. Member for Neath (Mr. Coleman) approves of the final map upon which we decided, which includes the valleys he mentioned. This year, a whole range of projects will take place in his constituency.
I grew up in the Welsh valleys, but was obliged to leave because of lack of employment opportunities as a Conservative Member of Parliament. I welcome the initiatives that my right hon. Friend has announced today. Is he rather surprised at the somewhat ungenerous response from the Labour party, considering that, in its day, it arranged neither a press conference nor a statement in this House because there were no initiatives? Does my right hon. Friend agree that the most successful forms of regeneration are those that harness the huge resources of the private sector to the public sector, as with the London docklands? What part will the private sector play in the initiative that my right hon. Friend has announced?
The most important aspect of this initiative is that one is moving from an economy that was totally dependent upon a couple of nationalised industries and local government employment to a diverse free-enterprise economy. If my hon. Friend studies the full programme, he will note that we analyse 11 firms in the valleys. Three of those companies are inward investment firms, two come from Japan, and one from Germany and they are large, medium and small firms. In total those 11 firms alone will invest £200 million of their money in the next three years. The applications for regional development grant and regional selective assistance will provoke at least £1 billion of private investment. So we are moving towards a diverse, privately owned free enterprise economy in the valleys.
How much new money is involved? How does the right hon. Gentleman propose to strengthen the WDA, which is the powerhouse of his scheme, in salaries, manpower and training? How will he assure county councils such as those of Clwyd and Gwynedd that the necessary investment in the valleys is not the precursor of a famine of funds for the north?
The valleys deserve social justice, and the objectives of the initiative are to be welcomed. The Secretary of State should remember that it was the valleys, with their coal and steel production in the last century and early in this, that made our nation a front-rank power—and they should have social justice.
I very much agree with the hon. Gentleman. In view of the damage done and the problems that have been caused to the valleys in the course of this century, there is a national duty to tackle this problem. I assure him that the activities of the WDA and the factory building and urban development programmes in north Wales will be unaffected by these proposals; they will, I am glad to say, go ahead at an accelerated rate.
The Secretary of State will know that I represent the major opposition party in the valleys. On behalf of all our councillors in local authorities there, I say that he certainly has their support for carrying out this programme. We welcome its concept and framework; it is a broad-ranging programme that takes in cultural as well as economic activity.
I want to ask, first, about the availability of commercial capital, about which the right hon. Gentleman has been a little coy. In other regional initiatives in England by development corporations, there is much more commercial funding up front—and it is clearly stated as such. It does not seem to be available in this programme.
Secondly, how does the right hon. Gentleman intend to ensure that there will be additional European Community funding for this? Can he give us any news about the integrated operation programme for the valleys? We warmly welcome the IOP announced for other parts of Wales.
On the latter point, I think that £25 million has already been allocated to one part of the valleys, and we are hoping that at least another £100 million will become available in the forthcoming period. Of course, that is subject to negotiations in Brussels.
I am grateful for what the hon. Gentleman said about the scheme in general. In the context of commercial funding, there are two important aspects for smaller businesses: the two new loan schemes that the WDA operates which are mentioned in the programme. I am also glad that the 3i's—Investors in Industry—the major source of venture capital, has decided to increase its investment in the valleys by two thirds.
Does the Secretary of State understand that many of us who represent valley communities have been waiting patiently for this statement? Some of us are sad about it because we feel that he has not taken the initiative we thought he would.
I ask first about a matter that was not clear from answers to questions asked earlier. A point of order was raised yesterday about the public expenditure White Paper published in February, and page 35 was mentioned. Has the Secretary of State been able to persuade the Cabinet to allow new money for this valleys initiative? When I looked at the map and read hurriedly through his statement, I found that the Ogmore constituency, which contains the four valleys of Maesteg, Ogmore, Garw and Gilfach Goch, had been neglected. The only addition shown in the initiative is some funding for the refurbishment of the Blaengarw workman's institute. What will that do to help the 5,000 miners—[HON. MEMBERS: "Reading."]
I shall not be much longer, but I must emphasise to the Secretary of State that since 1979, 5,000 miners have been put on the dole in the Ogmore constituency. In addition, 5,000 steelworkers have been thrown out of work. That means that in my constituency 10,000 people have been put out of work. The whole initiative would not employ all those people.
I can understand the hon. Gentleman being interested in the detail of the programme and in how it affects his constituency. I agree that his constituency has all the problems. He may be pleased to know that, in the financial year 1988–89 alone, £685,000 will be spent on continued work on the Maesteg town centre, that £400,000 will be spent on land reclamation in his constituency, and that £500,000 will be spent on new factory building.
In constituency terms I welcome the Pentrebach-Dowlais road development. It is an important link and I have written to the Minister on numerous occasions about it. Will he confirm that the British Coal Opencast Executive proposals will now fall because they totally impede that development?
Why has the Minister not listened to us on the central question of home improvements and housing repair? Individuals, as opposed to enveloping schemes, now have a backlog of requests and applications that go back four years. Why will the Minister not unlock this backlog? Mid Glamorgan area health authority has one of the most pressing demands in Wales, yet health matters make up the weakest part of the Minister's initiative. Wards such as the St. Tydfil ward remain closed and the initiative does not address hospital capital and current requirements. We are deeply disappointed with that part of the initiative.
As one of the hon. Members who represents part of the valleys, the hon. Gentleman has no right to be disappointed with the initiative. Apart from the major road improvement scheme about which he rightly says he has constantly pressed and which he says is very important, in the current financial year £2,700,000 will be spent on new factory building and £500,000 will be spent on clearing derelict land. In addition, £947,000 will be spent on the continuation of improvements to Merthyr town centre. In total, the impact on Merthyr in one year alone will be considerable. The hon. Gentleman spoke about housing improvements. Since 1979, we have improved 45,000 houses, and in the next three years we intend to improve another 32,000.
I wish I could share the Secretary of State's considerable euphoria about his statement, but unfortunately I cannot. There will be £8 million for housing. In my constituency, where more than half the private housing is unfit for human habitation, we need £64 million to improve it. He is offering £8 million for the whole of the valleys, and that puts the matter in context. He has made great play of land reclamation. There are 34,000 acres of derelict land in Wales and the Secretary of State is offering money to improve 2,500 acres. We lag far behind England and Scotland in the clearance of derelict land. Since 1979, the Welsh Office has cut the programme of land clearance in Wales.
The Minister is making available £30 million of public money for the Cardiff bay development. I do not begrudge Cardiff that money, but were it not for the valleys, Cardiff would not exist at all. Of all the indices, the argument on social and economic grounds for improving the situation in the valleys is enormous. The Secretary of State is following his mistress's philosophy, which is to give to the rich and to take from the poor.
Now that the hon. Lady is so much in favour of home improvements and the clearance of derelict land, I hope that she will explain to her constituents why she disapproves of a programme that is far bigger than any programme that a Labour Government ever envisaged or put into practice. In her constituency alone in this financial year, £1,100,000 will be spent on land reclamation and £683,000 will be spent on improvements to the town centre. I am glad to say, as I know that the hon. Lady will be glad to say, that her local authority has now agreed a housing strategy. I hope that it will carry it out.
I thank the Secretary of State for including the Amman and Gwendraeth valleys in his initiative. Why does the initiative not contain some European money? Last week we had the Dyfed, Gwynedd and Powys initiative and half the money for that came from the European Community. Surely the regional fund should provide back-up for this inadequate initiative. How much of this money is recycled? I have a strong feeling that it is the same old shop and that the goods in the window have been rearranged. I shall quote one example from my area. The Amman valley hospital modernisation programme was announced six months before the last election. In September, immediately after the election, it was postponed. Now I find out what we knew anyway, that a modernisation programme which was in the pipeline is in this new initiative. These are recycled goods.
I discussed with the health authority the projects mentioned in this initiative. I cannot give the go-ahead until the people responsible have agreed that the projects should be part of their strategy. I think that this is a correct list of the proposals that appear to them arid to us to be the ones likely to develop. The hon. Gentleman asked about European assistance. Under the Mid Glamorgan national programme of community interest, an estimated £26 million from the European regional development fund is likely to be distributed to projects in the valleys. The proposed integrated operations programme for industrial south Wales may also attract aid of about £100 million. Of course, the decisions will be taken in Brussels.
While inwardly digesting the Secretary of State's rather touching belief that £37 million-worth of improvements in the valleys will open the door to greater prosperity, I must tell him that it takes both Courage and Brains to believe that this is the way to give the valleys Allbright future. Will he comment on the figures that he has given for manufacturing development in the valleys, including the great announcement that British Telecom will bring telephone ownership to the valleys? Can he tell us whether manufacturing employment as a whole in the valleys is likely to increase over the next 10 years, or whether it will hold its own or decline?
The hon. Gentleman should look at the potential of £1 billion of investment in regional development, at the £200 million investment by just 11 firms in the valleys, and at the £92 million of capital investment by the public utilities. That will show him that major investment is taking place. I am sorry that the hon. Gentleman is cynical about the £40 million of investment by the two main brewers in the valleys. That will considerably help the tourist industry, will make far more attractive buildings than the existing ones, and will create a great number of jobs. I welcome that as an addition to the whole substantial programme.
My wife is half Welsh and her uncle sings in a Welsh choir— [Interruption.]Can my right hon. Friend say whether the new music centres and arts centres that he has proposed for the valleys will be used to promote the work of Welsh male voice choirs, whose marvellous standards and world-renowned quality deserve a wider hearing? Will he consult the Minister for the Arts and the Foreign Secretary to see whether the number of engagements on the continent can be increased?
When the Secretary of State made his statement, he welcomed the full co-operation that he said he had received from Welsh local authorities, from the Wales TUC and from employers. I hope he realises from the reception for his proposals in the House that there is a great deal of disappointment. That disappointment stems from the fact that in past months the Secretary of State has deliberately been raising expectations in Wales. The statement has failed to meet those expectations and that is why there is bitterness and disappointment.
Why have we not heard about any new investment in manufacturing industry? Why have we not had any firm forecasts of jobs to be created or locations where those jobs will be created? We have heard no mention of one new hospital bed, let alone a new hospital ward or the new hospital that is desperately needed for mid-Glamorgan. No provision has been made for improving the standards of public health. No mention has been made of the need to improve the infrastructure in the valleys, especially the need to improve the quality and standard of our drainage and sewerage systems. There has been no mention of the opportunities that this initiative could have presented to improve the quality of Welsh drinking water.
The Minister has not shown that he will lift the shackles on local authorities when they try to improve our housing stock. We have had no indication at all that new money will be available either to repair the rotting fabric of our schools or to provide the additional teachers who are desperately needed.
The Secretary of State said in his new initiative document:
Unemployment is too high. The Valleys remain scarred by derelict pit heads and slag heaps. Much of the housing is still bad, some of it still failing to provide even the basic amenities of a bathroom or inside toilet. The health of the people also continues to suffer.
It is the misfortune of the people of the valleys that the Secretary of State has identified the problem, but he is a member of a Government who do not have the political will to address themselves to it.
It is a pity that the hon. Gentleman wrote that piece before hearing the statement or reading the document. The reactions of the House have been interesting. From the Opposition Front Bench, the right hon. Member for Swansea, West (Mr. Williams) has declared his party's hostility and has said how bad it thinks it is. The Liberal party, Plaid Cymru and Conservative Members have expressed their approval. Perhaps the Labour party has a nasty hang-up because, where it did so little for the valleys, the Tory Government are doing so much. All the items that the hon. Gentleman has mentioned—industrial and manufacturing investment and investment in water supplies, clearing derelict land and the environment—will be at record levels as a result of the programme, seemingly to the distress of the Labour party.