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Lord Falconer of Thoroton: I do not think that anybody underestimates the importance of the Welsh Development Agency or its increasing importance once the assembly is up and running. In our amendments to its purposes, we seek only to focus on that.

Amendment No. 259A seems to be an attempt to strengthen the legislative requirement upon the WDA to exercise its functions in pursuance of the purposes listed in Section 1(2) of the Welsh Development Agency Act. If that is the intention, perhaps I may assure the noble Lord that it is unnecessary, since the legislation already provides that the WDA can exercise its functions only for the purposes set out in that Act.

Acceptance of the first amendment in this group would have a material effect on the modus operandi of the agency, which could be to the detriment of Wales. The substitution of "shall" for "may" in Section 1(2) of the Welsh Development Agency Act would place a statutory duty upon the agency to ensure that each function it exercised satisfied each and every one of the purposes listed in that section. That would surely place an unrealistic limitation upon the activities of the agency and deny it the competence to deliver the kind of all-Wales economic, social and environmental development that the Government have promised.

The Government have already demonstrated their commitment to placing the environment at the heart of policy-making for Wales. As we have already discussed, the national assembly will itself be required to prepare a scheme setting out how sustainable development will be achieved in Wales: whether by itself or via the public bodies, including the WDA, which it will fund and direct.

The WDA already has as a purpose the improvement of the environment in Wales and as a function the development and redevelopment of the environment. In addition, it has the function of improving the appearance

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of derelict land. I would assert that the agency's own legislation, together with the relationship it will have with the assembly, will more than adequately provide for it to have a view to sustainable development in its activities and to be able to account for its activities in this area. The Government's view is therefore that Amendment No. 259B is unnecessary.

With respect to Amendment No. 259C, the Bill clearly establishes the powers of the agency to play a full and effective role in economic and social development in all parts of Wales by transferring to it the social development powers of the Development Board for Rural Wales. Obviously, the way in which these powers are exercised will be subject to the wishes and guidance of the assembly, but I submit to the noble Lord that they would substantially achieve his objectives without the need for Amendment No. 259C.

Amendment No. 259D would make it a function of the agency to promote exports from Wales. It is an existing purpose of the agency to promote efficiency in business and international competitiveness in Wales, and the agency has an existing function to,

    "promote or assist the establishment, growth, modernisation or development of",

businesses. At the moment, the Welsh Office is the main provider in Wales of export services and advice. Other bodies, such as the chambers of commerce, the training and enterprise councils and the Mid Wales Export Association, have, together with the WDA, been engaged with the Welsh Office in a review of how export services for small and medium enterprises in Wales might be better co-ordinated. In time, the assembly might wish to make its own arrangements for the provision of export services, but at the moment the agency is fully empowered to participate in the provision of export services.

The Bill as drafted preserves the wide-ranging permissive powers that the agency has. Control over which of the powers are exercised, and how they are exercised, must rest firmly in the hands of the assembly. Only in that way can we deliver the democratic accountability of public bodies that is fundamental to better government in Wales.

I appreciate that these amendments may largely be an attempt by the noble Lord, Lord Elis-Thomas, to probe the future powers and role of the WDA. I hope that my answers indicate that we are in considerable sympathy with many of his aims.

Before concluding, perhaps I may deal with the question asked by the noble Lord, Lord Roberts of Conwy, which was: why change the duty on the Welsh Development Agency from one with respect to "industry" to one with respect to "business"? There is nothing sinister in this. We believe that the word "business" better reflects the diverse nature of the modern Welsh economy. The change will not affect the range of powers available to the Welsh Development Agency.

I hope that I have given the noble Lords satisfactory assurances in each case and I therefore invite the noble Lord, Lord Elis-Thomas, to withdraw the amendment.

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5.45 p.m.

Lord Elis-Thomas: I am grateful to the Minister for those assurances. I am also grateful to the noble Lord, Lord Roberts, for reminding us of the activities not only of the WDA but also of the Development Board for Rural Wales, from the work of which I benefited greatly when I was the Member of Parliament for Meirionnydd Nant Conwy. As we see the DBRW being wound up and incorporated into a strengthened WDA, I pay tribute to all who have been associated with it.

I am particularly grateful for the assurances about the review of export services. We need to consider the current function of the Welsh Office in this regard and whether that function would be better placed with the agency, as proposed in my amendment or whether other arrangements might be established in due course. I welcome the comments about the review.

Finally, I should have declared an interest as the part-time chairman of Sgrin, which is in receipt of funding from the WDA as part of its media development work. We shall be looking to the WDA to be an even more flexible and an even stronger body in the future in relation to the assembly than it has been in the past. We shall all be concerned about the role of the agency and its ability to function as flexibly as is required by the changing economic circumstances of all regions of Wales.

I wish the agency well, together with all its staff who--it is important to record this--have gone through a rapid and difficult reorganisation while maintaining the morale and effectiveness of the agency's service delivery. Without naming names, I pay tribute to all who have been responsible for ensuring that. Following the specific assurances that I have received, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 259B to 260 not moved.]

Clause 127 agreed to.

Lord Elis-Thomas moved Amendment No. 260A:

After Clause 127, insert the following new clause--

Report by Agency to Assembly

(" . At the end of each financial year, the Welsh Development Agency shall provide a report to the Assembly containing information on--
(a) the geographical distribution of its expenditure in different parts of Wales,
(b) the arrangements it has made to assist the Assembly in carrying out its responsibilities under section 120, and
(c) the arrangements it has made to assist the Assembly in carrying out its responsibilities under section 121.").

The noble Lord said: Amendment No. 260A seeks to strengthen the reporting arrangements between the assembly and the development agency and the method by which the agency reports to the assembly. In particular, the amendment is related to the activity of the agency in promoting equality of opportunity and sustainable development. I hope that the Government will be able to assure me that it is their intention under the Bill that the agency should clearly operate to those objectives. I was pleased to note in that context--I refer

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in particular to paragraph (a) which refers to the geographical distribution of expenditure in different parts of Wales--that among the quoted objectives and principles of the enlarged WDA the building of strong regions is a very important aspect.

I do not know whether the Government are yet in a position to indicate that they now accept the argument that the regional committee structure of the assembly discussed earlier in Committee will approximate to the regions of the development agency. That would provide an opportunity for direct reporting as between the regions of Wales or the regional committees of the assembly and the work of the agency. It would be even more helpful if the Government could provide that reassurance at this stage.

Therefore, the intention of this amendment is to strengthen the link between the agency and the assembly and ensure that that happens by means of a formal reporting mechanism. The last thing that we want--I say this before the Front Bench opposite does so--is day-to-day political interference in the work of the agency by assembly members. We want to have the setting of broad objectives and the strengthening of reporting and accountability which have generally functioned well in the past, although not always. I beg to move.

Lord Falconer of Thoroton: As I understand the purpose of this amendment which seeks to insert a new clause, it is to provide that the Welsh Development Agency in its report should deal with certain specified pieces of information, including the geographical distribution of its expenditure in different parts of Wales and the arrangements that it has made to assist the assembly in carrying out its responsibilities under Clauses 120 and 121. Clause 120 relates to sustainable development and Clause 121 is concerned with equality of opportunity.

I sympathise with the close concern shown by the noble Lord in these matters. Although I cannot go all the way with him, I believe that he is pushing at an open door. Schedule 3 to the Welsh Development Agency Act 1975 requires the agency to report annually on its activities to the Secretary of State. In addition, the agency is required by paragraph 8(5) of that schedule to provide the Secretary of State with such information relating to its activities or proposed activities as he may from time to time require.

After its establishment the agency will report to the assembly. The assembly will have the same powers as the Secretary of State. The assembly will no doubt closely review the operation of the WDA on an annual basis. We have recently debated Clauses 120 and 121 of the Bill which impose duties on the assembly with regard to sustainable development and equal opportunities. The assembly will in turn determine the role of those public bodies it will fund and direct in discharging its duties under those clauses. That could readily include a requirement on the WDA to report on the matters indicated in this amendment. The assembly will have power to ask for the specific information that the noble Lord wishes to be included in the clause.

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Under the powers in the 1975 Act it could also require the agency to provide a geographical breakdown of its activities. Therefore, the assembly can make the demands that the noble Lord wishes it to make, but it is not for the Bill to prescribe it but for the assembly to decide. We believe that in neither case is there a need for further provisions in this Bill. I appreciate that once again the noble Lord by this amendment seeks to probe. I hope that I have reassured him sufficiently for him not to seek to press these matters further.

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