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Mr. Robert Walter (North Dorset): I am sorry that the Secretary of State did not quite understand the point being made not only by me but by other hon. Members--those in other parties, as well as those in the Conservative party. We were talking not only about the European Union funding, but about the additional funding that was supposed to come from the United Kingdom Government. There was no additional funding from the Government; the only additional funding comes from the existing block grant to the Welsh Assembly.

Mr. Murphy: The hon. Gentleman is mistaken; he knows that almost £500 million over the next three years will be additional to the Barnett block. If that is not additional, I do not know what is. He does not understand the funding arrangement. As he will be aware, both when the Conservative Government were in power and when I was a Northern Ireland Minister dealing with such matters, all the money involved in objective 1 structural funding--in Wales, Scotland, Northern Ireland or England--had to be found from the block itself.

The hon. Gentleman obviously does not understand, first, that the block has become much bigger in the past year--it is the biggest settlement ever paid to Wales by a United Kingdom Government--or, secondly, that between £400 million and £500 million will be paid over and above the Barnett formula in the next three years, so that we can draw down those funds. That represents an enormous development in the way in which public finances work. Any hon. Member--from whichever party--who suggests that that does not represent a major surplus for Wales does not understand the nature of that funding.

Mr. Wigley rose--

Mr. Murphy: I hope that the right hon. Gentleman does not want to make the same point as the hon. Member for North Dorset, because he knows that it is wrong.

Mr. Wigley: I understand the nature of the funding, and I welcome part of what the Secretary of State has just said. He has acknowledged that until now, not one brass farthing of European money over and above the Barnett block has come to Wales or any other part of the United Kingdom that is supposed to receive money from Europe. Will he acknowledge that, whereas we are supposed to receive £180 million a year for objective 1 from Europe, we do not, in fact, get that much in addition to the Barnett formula? We receive a sum above the Barnett level, but not the full £180 million--let alone the necessary match funding. That is why expenditure on education in Wales is being increased by a lower proportion than expenditure on education in England; the money has to be diverted to provide the match funding.

Mr. Murphy: Obviously I have to disagree with the right hon. Gentleman. Here are the figures: the additional funding in 2001-02--the new financial year, which begins in a few weeks--will be £113 million; the year

5 Mar 2001 : Column 48

after, it will be £148 million; and the year after that, it will be £160 million. That amounts to £421 million in total over those three years. The point is that in the past, all the money had to be found from the block itself, but those sums are additional to the block. That is a major change in the way in which we deal with public finances. Does the right hon. Gentleman think that if the United Kingdom Government were not prepared to pay that money, the same amount would come from money raised in Wales alone? I very much doubt whether it would.

Mr. Alun Michael (Cardiff, South and Penarth): I suppose that we have heard the nearest that we shall ever get to an apology from the right hon. Member for Caernarfon (Mr. Wigley) for supporting a lie in the Welsh Assembly just over a year ago. It is just as well that that did not happen in the House. Will my right hon. Friend invite the right hon. Gentleman and his colleagues in Plaid Cymru to stop the continual whingeing that we have heard for so long, support the initiatives that objective 1 status can produce and start to help to improve the economy of Wales, instead of damaging it by continually discouraging people from proposing schemes?

Mr. Murphy: My right hon. Friend is right. There was a lot of fuss and bother about whether we would get that money, but we did get it, and in a special way. However, all our energies in Wales were spent on arguing with each other about whether the money would come, rather than on preparing the schemes for the objective 1 areas, which are so important. We must not fall into that trap again. The money is there, the will is there, and it is now up to everyone in Wales--from north to south and from east to west--to encourage the partnerships and to ensure that we spend the money wisely.

As I said, it must have been something of an embarrassment to the hon. Member for North Dorset that the funding was found. He denies that he was embarrassed by his failure to understand the issues, but the money is there. His embarrassment could only have been compounded when Conservative central office denounced that decision, and the rest of the spending review, as a "public spending binge" and as a return to "tax and spend".

The briefing for Members of Parliament--it was for Conservative Members, I hasten to add, but I am pleased to say that a copy has also found its way to me--goes on to say that there is a £16 billion spending gap between what the Conservatives say is affordable and what Labour plans to spend. However, Wales will suffer badly if the Conservatives ever get their chance to close this "gap", because the 2000 spending review increased Welsh spending through the block faster than Government spending as a whole. The Welsh block will rise by about £2 billion over the next three years. That means more money for schools and more money for health. Welsh services dealt with outside the block, such as the police, have also done well, so there is also more money for policing in Wales.

How do the Tories propose to fill that gap? I know: they will cut, cut and cut. They will cut our schools budget, they will cut our health budget and they will cut our police budgets. In Wales, they will slash the very objective 1 budget that the hon. Member for North Dorset commended only a year ago. What else could we expect from a party that has swung so decisively against Europe?

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Yesterday's speech by the right hon. Member for Richmond, Yorks (Mr. Hague) was condemned by the Financial Times today as

The reality, as the newspaper makes clear, is that the Tory anti-European bandwagon is now hurtling towards the precipice marked "Withdrawal". As the newspaper's leader column adds:

Withdrawal from Europe would represent an economic and political disaster for the whole United Kingdom, and for Wales in particular; we would suffer most. Conservative prejudice and intolerance would leave thousands out of work, close off our export markets and destroy our agriculture.

Of course, the Tories' intolerance finds its echo in the words of Councillor Seimon Glyn. [Interruption.] I thought that Plaid Cymru Members would be upset by this; they do not like to hear about him. His view is that 80 per cent. of his fellow countrymen and countrywomen, such as me, speak a foreign language, and that incomers from Chester need to be "monitored and controlled". I notice that the hon. Member for Ynys Mon (Mr. Jones), the leader of the Welsh National party, is not here today to talk about these issues. The only difference is that while the Tories want to withdraw from Europe, the nationalists want to withdraw from Britain. Of course, many nationalists must want the Tories to be returned to power, because both parties have a common interest in undermining the devolution settlement.

Mr. Elfyn Llwyd (Meirionnydd Nant Conwy): I am rising to the right hon. Gentleman's bait on the question of what Seimon Glyn did or did not say. However, did the right hon. Gentleman read what the right hon. Member for Caerphilly (Mr. Davies) said in The Western Mail on Saturday, in which he acknowledged that there was a problem with support for the Welsh language? The silence from the Labour Government on that matter is deafening.

Mr. Murphy: My right hon. Friend was speaking from Zagreb. I happened to be speaking in Swansea, where the Labour party conference was meeting, and the view from Swansea is very different from the view from Zagreb.

Mrs. Jackie Lawrence (Preseli Pembrokeshire): Is my right hon. Friend aware that in the 1980s, Cymdeithas yr Iaith Gymraeg used the well-known phrase, "Heb waith, dim iaith"? This Government have done more to create work in Welsh language areas and to preserve the language than any Plaid Cymru carping could do.

Mr. Murphy: I agree with my hon. Friend; I know that she takes an interest in these issues.

Mr. Clifton-Brown: The Secretary of State has misrepresented the Conservative party's policies in a way that is unworthy of him. Would he now care to comment on the Labour party's stewardship of the health service in Wales? Since the election, in-patient waiting lists have gone up by nearly 15 per cent., out-patient waiting lists have almost doubled and the number of those waiting for more than six months to see a consultant has gone up by 700 per cent. Will he comment on those figures?

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