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Manufacturing Industry

2. Mr. Graham Brady (Altrincham and Sale, West): If he will make a statement on manufacturing competitiveness in Wales. [155492]

7. Ms Julie Morgan (Cardiff, North): What discussions he has had with the First Secretary about plans to help manufacturing industry in Wales. [155498]

The Secretary of State for Wales (Mr. Paul Murphy): The Government are committed to improving manufacturing competitiveness throughout the United Kingdom by helping established industries to modernise and to compete in new global markets, by encouraging enterprise and by creating a stable economic climate.

Mr. Brady: The Engineering Employers Federation has warned that 150,000 manufacturing jobs will be lost in the next year. Is it not utterly irresponsible for the Government to pile yet more costs on to manufacturing businesses in Wales through the climate change levy?

Mr. Murphy: Manufacturing productivity, output and exports are all up. The record of the hon. Gentleman's party when it was in office contrasts badly with that. On the climate change levy, I have no doubt that it is the right thing to do, ensuring that we balance the way in which we deal with the climate and the environment in general, and the way in which businesses can play a responsible part in that.

Ms Morgan: Does my right hon. Friend agree that the real problem for manufacturing industry in Wales is the threat from low-wage economies, such as those of Hungary and Poland, where wages are at least a sixth of ours? Does he agree that the way ahead for Welsh manufacturing industry is to work closely with universities and institutions to develop cutting-edge technology? Federal Mogul on the Llanishen trading estates in my constituency has done that very thing.

Mr. Murphy: I could not agree more. My hon. Friend is aware that it is the Government's job to try to manage any change in the economy, and that many high-tech, knowledge-based companies are moving to Wales, bringing many jobs. That is how we must manage the economy in Wales--ensuring that, when jobs go, we replace them with other jobs.

Mr. Elfyn Llwyd (Meirionnydd Nant Conwy): That may be what the Secretary of State says now, but does he realise that 20,000 manufacturing jobs have been lost since Labour took office? Referring to what the hon. Member for Cardiff, North (Ms Morgan) said, Welsh manufacturing is now so bad that it is at the bottom of the competitiveness league. It is on a par with that of Hungary, so what is the right hon. Gentleman doing? What representations is he making in Cabinet to stem the flow of jobs?

Mr. Murphy: Is the hon. Gentleman aware that there are 17,000 more jobs in Wales since this Government came to office? Hon. Members must understand that that figure is a real one. I represent a manufacturing constituency and I know that, when it loses jobs--for

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example, Corus may decide to shut down part of Llanwern--those jobs are being replaced very quickly by other jobs. On Friday this week, I am opening a factory in my constituency, where a total of 264 new high-tech jobs are being created for my constituents. That has been replicated time and again throughout Wales.

Mr. Llew Smith (Blaenau Gwent): The Secretary of State will be aware that the reasons given by Corus for closures and redundancies are financial. Will he comment, then, on its decision in the past few days to hand out 1.6 million share options worth £900,000 to four directors, and on the fact that the two former chief executives who were sacked, seemingly for incompetence, have been awarded redundancy payments in excess of £2 million? Can he imagine the anger felt in my community that the people who destroyed the industry are getting big handouts while those who built the industry and made it the most efficient in the world are getting the dole queue?

Mr. Murphy: I can imagine the feelings of the people in Blaenau Gwent, and Ebbw Vale in particular. I do not want to comment on the individuals, because that is a matter for the company, but it is also a matter for the company that if it goes ahead with its original plans, it will bring all the uncertainties and problems of redundancy to people in areas such as my hon. Friend's, who cannot overcome those problems unless they have alternative employment. It is still the Government's belief that Corus should take a long-term view of the steel industry, ensuring that jobs are kept and the industry continues to flourish.

Mr. Robert Walter (North Dorset): For some time, Conservative Members have been highlighting the damage being done to the competitiveness of the Welsh economy by the high value of the pound against the euro, by over-regulation, by stealth taxes and by the climate change levy.

If the thousands of job losses at Corus were not enough, month by month there is a stream of other job losses: 65 to go at Chubb Fire in the Rhondda; 61 at Honeywell in Treforest; 79 at Arkana in Caerphilly; 88 at General Electric in Nantgarw; and the complete closure of Takiron in Bedwas. Mr. John Spencer of Chubb Fire summed it up when he said:

Farming is in crisis in Wales; tourism is in crisis; and manufacturing is disappearing before our eyes. [Interruption.]

Mr. Speaker: Order. No one should be shouting at the hon. Gentleman.

Mr. Walter: Are the Government doing anything about this, or are they abdicating responsibility to the National Assembly and the Liberal Democrat leader in Cardiff?

Mr. Murphy: The hon. Gentleman gave us a list of companies that, unfortunately, have had problems surviving over the past few months. Let me give him a couple of alternatives: Ford in Bridgend, 640 jobs; Conduit in Cardiff, 500 jobs; small businesses in

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Denbighshire, 490 new jobs; Halifax Card Services in Cardiff, 400 new jobs; Toyota in Deeside, 310 new jobs; and so on, and so on, and so on.

Economy (Deeside)

3. Mr. Ben Chapman (Wirral, South): When he last met the First Secretary to discuss the economy in Deeside. [155493]

The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson) rose--[Interruption.]

Mr. Speaker: Order. Mr. Donohoe, you shout so much it gives me a sore head.

Mr. Hanson: My right hon. Friend the Secretary of State and I meet the First Minister regularly to discuss a range of issues, including a variety of economic issues affecting Wales.

Mr. Chapman: Does my hon. Friend agree that the economic prospects for the people of Deeside--on both our sides of the river--are better than they have been for many years, not least because of low interest rates, low inflation and low unemployment, but also because of major investment coming on stream at, for example, BAE Systems in Broughton and at Toyota? Does he also agree that that would all be put at risk if we were to return to the days of paranoia about Europe; public spending cuts; tax promises made only to be broken; and boom and bust? Those are the policies that characterised the Conservative party's time in government.

Mr. Hanson: My hon. Friend makes some valid points. He will be aware that Toyota at Deeside has invested £100 million and created nearly 500 new jobs, and that BAE Systems at Deeside has created hundreds of new jobs--wings are made in Wales and other aircraft parts are made in Europe. That would certainly be affected by Conservative European policies. On both sides of the Dee, unemployment is down, and in my hon. Friend's constituency it has fallen by more than 700 since the general election. The Labour Government are working for Deeside on both sides of the river, and I support his efforts.

Mr. Simon Thomas (Ceredigion): What assessment has the Minister made of the impact on Deeside's economy of the unilateral decision by the Department of the Environment, Transport and the Regions to plant GM crops in Flintshire, which is one of three sites in Wales being used for that purpose? What impact will that decision have on Deeside's agriculture and economy? As the local Member and as a Minister, was he informed of the decision? If so, what was his response? What did he tell Assembly Members about the decision? Did he inform hon. Members of the decision?

Mr. Hanson: The hon. Gentleman will know that the sites were chosen on the basis of scientific advice from the scientific committee, SCIMAC--supply chain initiative on modified agricultural crops. There have been continuing discussions on those matters with the National

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Assembly and with Government colleagues. For the hon. Gentleman's information, Sealand is not in my constituency.

Mr. Barry Jones (Alyn and Deeside): Does my hon. Friend agree that, on Deeside, we need a very substantial steel spine to our manufacturing capability? With the loss of 319 steel jobs, what can the Wales Office do to ensure that redundant steel workers are given jobs at the nearby Airbus factory, where 1,700 new jobs are available? Does he think that the trainers are up to the job of training redundant steel workers to work in aerospace?

Mr. Hanson: In my right hon. Friend's 31 years in the House, he has been a strong supporter and has battled hard for steel and for aerospace. He will know that my right hon. Friend the President of the Board of Trade has indicated his willingness to approach the European Commission for help and support to re-train steel workers who may face redundancy. He will also know that, following the Labour Government's investment of more than £530 million, there are great and advancing job opportunities in British Aerospace, which I hope many of the steel workers facing potential redundancy will be able to take up in the near future. [Interruption.]

Mr. Speaker: Order. Before I call the next question, I call the House to come to order.

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