The Assembly met at 13:30 with the Presiding Officer (Dame Rosemary Butler) in the Chair.
Y Llywydd / The Presiding Officer
Good afternoon. The National Assembly for Wales is now in session.
Y Llywydd / The Presiding Officer
Given that the Welsh Government announced a pilot project to test cancer waiting times today, I have decided to extend the opportunities for Members to scrutinise the Minister for Health and Social Services on this issue at question 6. The Minister has kindly agreed to that.
Specialist and Critical Care Centre in Cwmbran
1. Will the Minister provide an update on progress made towards delivering the Specialist and Critical Care Centre in Cwmbran? OAQ(4)0435(HSS)
I thank Lynne Neagle for that question. Using the £12 million that was made available in the last financial year, Aneurin Bevan Local Health Board is now preparing a full business case, and expects to submit it to the Welsh Government in November 2015. The current timetable indicates that construction will start in 2016.
Thank you, Minister. As you know, I see this development as fundamental to ensuring that my constituents in Torfaen, and residents in Gwent more generally, have access to the twenty-first century healthcare that they deserve. Now, while I recognise that capital cuts from Westminster have led to delays, and also that the critical care centre is central to the wider transformation of the hospital network in the south Wales programme area, what further assurances can you offer me today that this vital development remains a top priority for this Welsh Government? Furthermore, moving forward, will you commit to providing Members in the Chamber with regular updates on progress in delivering this flagship capital project?
I fully recognise the points that the Member has made about the importance of the SCCC. It was there as a pivotal part of services for Gwent, in each of the options that were considered within the south Wales programme, and because of that, I decided last year to move ahead with a funding package, in advance of the south Wales programme coming to a conclusion. The £12 million that has been provided not only allows Aneurin Bevan health board to prepare the full business case, but it means that a package of advanced works—including ecological measures, the demolition of redundant blocks, and some work to services on the site—are able to go ahead in this financial year, making sure that we will be able to move ahead with the project in a timely fashion.
Minister, I am grateful for your clarity on this. The Gwent Clinical Futures hospital reconfiguration is probably unusual compared with other reconfigurations in Wales, in that it is actually relatively popular, not just with clinicians and the public, and Lynne Neagle and me, but with everyone who has been involved in the project. There were concerns raised yesterday during the infrastructure statement that there might not be sufficient funding to see this project through to completion. I am grateful for what you said today. However, will you give us your absolute assurance that building work will start in 2016, and that it will not slip down, because, as Lynne Neagle has rightly said, patients in Cwmbran, and Monmouthshire, and in the wider south-east Wales area, need access to this twenty-first century facility?
Just to be clear, nothing was said in the Minister for Finance’s statement yesterday, because the funding for the SCCC is already there, in the capital programme that I manage as the Minister for health. I am keen to see a proper start on that in 2016. I should have said in answer to Lynne Neagle’s question that I will, of course, report further to the Assembly as we get further information from Aneurin Bevan health board, and as the project moves ahead.
Minister, I have no reason, of course, to doubt you—I would never do so, but since this project was first proposed in 2005, and since, all along, there has been support from all the relevant agencies, we could ask why we still have to wait until 2019 before the centre is actually built. What has been the reason for the project to take so long, from first proposal to completion, since it is indeed the resource that is desperately needed for patients in south-east Wales?
I am not in a position to provide a history lesson on the SCCC this afternoon. What I am prepared to say—and I think what we should focus on in the Chamber—is that, with the south Wales programme in its very final stages of agreement, and with the SCCC there as a fundamental part of the south-east Wales alliance, as the programme sets it out, it is now going to happen; the plan is there, and the timescale is there. It is a very complex programme, and it is very important that the health board works hard to get it right in making sure that the relationships between the new centre, the Royal Gwent Hospital and what goes on at Nevill Hall Hospital are put properly in place, and I am determined to focus on that for the future.
Y Llywydd / The Presiding Officer
I call the Welsh Liberal Democrat spokesperson, Kirsty Williams.
You will forgive my constituents in Brecon and Radnorshire for being slightly cynical about this, Minister, because, with all due respect, we heard these promises from the previous Minister for health. Could you confirm that no services will be lost from Nevill Hall Hospital in Abergavenny prior to the new hospital opening for patients in 2019?
I have seen nothing from Aneurin Bevan Local Health Board that leads me to believe that services would be lost in advance of the SCCC and because of the SCCC. What I will say is this: I am clear with the Aneurin Bevan health board that it has to come forward with proposals that describe the new relationship between existing services and the new service. This is an ‘instead of’ not just an ‘as well as’ hospital at the SCCC. It will make a difference to other parts of the jigsaw in Aneurin Bevan because that is the way that we need to provide health services in the future.
My constituents are expecting to see services removed from Nevill Hall Hospital to the SCCC in 2019. What we do not want to see are services lost from Abergavenny in the meantime. Let me enlighten you, Minister: Aneurin Bevan health board is actively looking at its ability to continue to provide emergency surgery, paediatrics and consultant-led obstetrics at Nevill Hall in the run-up to 2019. What I am looking for and what my constituents are looking for is a guarantee that no services will be lost until everybody is ready to move to that new facility. Of course, if the Welsh Government had stuck to its original plans, that hospital would nearly be open by now and we would not be facing this loss of services.
I would fully expect Aneurin Bevan to be keeping services under review on all its sites. None of us here would want to see a health board go on providing a service that is not safe for patients to use. I think that what the Member is trying to do is to put together two distinct sets of arrangements and make them into one argument that does not hold together. I expect the health board to make sure that the services it provides are the right ones for its population.
Y Llywydd / The Presiding Officer
Question 2, OAQ(4)0425(HSS), is withdrawn.
3. Will the Minister provide an update on the development of care alliances as part of the South Wales Programme? OAQ(4)0438(HSS)
I thank Keith Davies for the question. All local health boards across south Wales are now committed to the creation of three acute care alliances, namely south-east Wales, south Wales central, and south-west Wales. The alliances will be established by the constituent health boards. Their detailed composition and governance arrangements are currently being developed.
Over the past month, two clinics—one in Prince Philip Hospital and one in the Amman Valley Hospital—have been run by specialists from England. I now hope that the new alliance that you mentioned between Hywel Dda Local Health Board and Abertawe Bro Morgannwg University Local Health Board will offer opportunities for both health boards to collaborate. Bearing in mind that there is to be a new medical college in Swansea, we in Hywel Dda look forward to seeing that collaboration.
Of course, I am very pleased to hear that patients in Llanelli and Ammanford are receiving the treatment that they require. However, in the future, the point of having the new network is to ensure that hospitals do not continue to work on an individual basis but that they collaborate across health board boundaries, as part of the network that cares for patients and that gives to residents in south Wales, including those in Llanelli, better services that build on the close working relationship that already exists between Abertawe Bro Morgannwg University Local Health Board and Hywel Dda Local Health Board.
Minister, taking a priori that these care alliances are extremely important now and in the future and that, by your own admission, the new specialist crictial care centre will not be built for five years, can you give an assurance that it will at least be adequately planned for within that critical care centre, so that all the services can be delivered as well as is possible and joined together?
I thank William Graham for his recognition that the three new alliances will be fundamental new building blocks to provide services for patients across the whole of south Wales. The critical care centre for the south-east Wales alliance is fundamental to making sure that the services that are needed for people when they require very specialist services will be there, available close to home and on the ground, and the planning for that is fundamental.
Minister, in Neath Port Talbot, there was a discussion with Gellinudd Hospital where one cabinet member of the council had stated that there was no collaboration between Abertawe Bro Morgannwg University Local Health Board and the council in the context of creating an alliance in order to ensure co-operation when Gellinudd was closed. This demonstrates at a local level how people want to see alliances form, but that is not happening at grass-roots level. How can we ensure, with the south Wales programme, that this is going to be a reality in the future?
I do not think that there could be any doubt, Llywydd, that the level of discussion about the south Wales programme, and the resulting plan to create the three alliances, has not been a process in which there has been huge engagement, both from clinicians who do up the plan, and subsequently, among members of the public who have taken part in the consultation on it—the largest number of people ever to respond to a consultation exercise on health matters in the history of the national health service in Wales. So, of course, the point that Bethan Jenkins makes is important, namely about making sure that people who have a contribution to make to the creation of alliances are able to make it, but I do not think that anybody could argue that the south Wales programme is not already a very good example of what needs to be achieved.
A cornerstone of the programme is, of course, the ambulance service and I am sure that you would join me in congratulating Cwm Taf Local Health Board with regard to its eight minutes and 43 seconds-handover time, which is well below the 15-minute target. That deserves recognition. However, we are still to see the same level of progress in respect of ambulance emergency calls performance. Could you outline the steps that are being taken to improve those, particularly within the Rhondda Cynon Taf area?
I very much share Mick Antoniw’s congratulations to Cwm Taf health board for what it has achieved over this winter in reducing ambulance handover times. It is an example to the rest of Wales of the way that this can be done. What the central alliance does is to bring Cardiff and Cwm Taf together, and there is no doubt that some of the difficulties that have been experienced with ambulance services in the Cwm Taf area have been created over this winter by the temporary arrangements at accident and emergency services at the Heath hospital in Cardiff, which is moving to its new accommodation. Ambulances held up there have had a knock-on effect in Cwm Taf, and the alliance will help to put that right.
Y Llywydd / The Presiding Officer
Question 4, OAQ(4)0426(HSS), is withdrawn.
5. Will the Minister make a statement on NHS performance in Wales? OAQ(4)0424(HSS)
We monitor closely 43 areas of NHS performance. Over the last year, 29 of these have shown either sustained or improved performance.
One of those areas that have not shown significant improvement is ambulance response times, where recent figures show yet another month of missed ambulance performance targets. That is despite the fact that Wales has a lower target than other parts of the UK. Obviously, it is important that ambulances are able to respond in emergencies. Given that there were reports yesterday in the media of individual households in north Wales calling ambulances on almost a daily basis, with very few of those calls resulting in conveyance to hospital, what action will you take through the opportunity presented in the public health (Wales) Bill to make patients take more responsibility for the way in which they use the NHS?
I thank Darren Millar for the points that he made yesterday in relation to those figures that were published about the use of ambulances in north Wales, where one single household was reported as having called an ambulance on 270 different occasions. There is work going on within the Welsh Ambulance Service NHS Trust and in accident and emergency departments to track and identify a small number of people who make very high-volume use of those services. In the past, that has simply been allowed to be responded to on a time-by-time basis. What they are now doing is going to see those households, trying to find what underlies that pattern of use, and putting right the problem that causes it. As a result, they have had some very big success in reducing those calls. However, undoubtedly, the Member is right to say that all of us have a duty to make responsible use of these services, and some of the figures that were published yesterday show that that is not universally respected.
What progress has been made in reducing delayed transfers of care in Wales?
I thank Gwyn Price for that question and the two points are in many ways connected, because the ability of ambulances to do their job and to hand over patients in a timely fashion is connected to the back-door ability of the hospital to discharge people in a timely fashion. What we have seen is a 30% fall over the last five years in delayed transfers of care in Wales—a 7% fall in the last year alone. Numbers are now at an all-time low and the figures published last week showed that the median number of days delayed by any one person has fallen below 20 for the first time since records have been collected.
Minister, you will be aware that the performance of the NHS in Wales is so much worse than that in Scotland and in England in the context of waiting times for diagnostic testing. If we take colonoscopy as an example, 97% of people are given a colonoscopy within six weeks in England, while the figure stands at 93% in Scotland. However, the figure for those receiving a colonoscopy within six weeks in Wales is only 52%, and only 82% receive the test within 18 weeks in Wales. Can you explain to us this afternoon why these waiting times are so much longer in Wales than they are in Scotland or in England?
I have said on more than one occasion in the Chamber that I am not happy with our figures as regards diagnostics. We have seen the situation improving in those months bordering the last financial year. I have put an additional £4 million into the services in Wales, and £1 million in capital funding to assist the service to improve these figures. I am confident that, over the ensuing months, we will see the situation improving, and improving swiftly.
I am aware of the intervention and the funding that you have allocated, and I welcome that. Perhaps you could explain to us this afternoon whether this is one intervention and funding for one year, or whether it is annual funding that will increase the diagnostic capacity in Wales over a longer period. Perhaps you could also give us some suggestion as to when you believe we should expect to see more than 90% of Welsh patients being given some of these diagnostic tests within six weeks.
Let me be clear: the money is intended to, in the first place, clear the backlog of people who have been waiting too long. The capital money in particular is to allow redesign of some key services and to improve the premises from which some key services are provided so that we reach a point when all of those people who we expect to be seen within eight weeks—as that is the target time that we have here in Wales—are seen in that timely fashion. We will discuss with health boards once that work has been completed whether further ongoing investment is needed to keep the figures at the level at which they need to be. However, the money that I have announced so far is to make sure that we get to that steady state.
Minister, you will know that despite the positive experiences of many people in Abertawe Bro Morgannwg University Local Health Board hospitals, a number of patients and their families remain dissatisfied by the treatment that they have had in those hospitals. They are seeking a further investigation into what happened to them and others who are associated with that treatment. You will know that there is an inquiry going on. Could you give an indication of when that inquiry will be reporting and whether it will take into account the historical complaints that have arisen from ABMU and the action group that has been set up?
The terms of reference for the June Andrews review are very clear, in that she was able to look back in time as well as look at the position in the two hospitals as it is today. The First Minister was clear in answering questions yesterday that we expect to publish that report very shortly.
Cancer Treatment Target Times
6. Will the Minister make a statement on cancer care treatment target times in Wales? OAQ(4)0432(HSS)
I thank Sandy Mewies for that question. Cancer waiting times in Wales remain among the best in the United Kingdom. The period since October 2013 has seen the best sustained performance in the Welsh NHS since January 2011. Today, with the assistance of leading cancer clinicians, I have published plans for further improvements to waiting time targets in this area.
Thank you for that, Minister. The statistics show that not only do more cancer patients receive their treatment within the target time in Wales than in England, but that cancer survival rates are improving, with a 14% rise in the one-year survival rate and a 15% rise in the five-year survival rate. In Wales, 89% of patients rated their care as ‘excellent’ or ‘very good’, with just 1% saying that it was poor. Minister, it is clear that Wales is leading the way on improving access to cancer treatment. However, what support is being given to aid research into finding a cure for this multifaceted disease?
I thank Sandy Mewies for the points that she has made. They will be heard loud and clear among those members of staff who work so hard to secure the improved service that we see in Wales, and it will be appreciated by them. She is absolutely right to point to the need for us to focus on research into new ways of treating cancer. That is why it is such good news that the number of people taking part in cancer trials in Wales has risen by 5% in the last year, exceeding the target that was set for that. In the last 12 months, we saw a 3.4% increase in tissue donations to the cancer bank, a cancer bank that is not just a national resource in Wales or even a national resource in the United Kingdom, but an international, leading resource. People’s willingness in Wales to contribute to that and to put themselves forward for trials is a very clear indication of their willingness to be part of research efforts at present and in the future.
Y Llywydd / The Presiding Officer
I call on the opposition spokesperson, Darren Millar.
Thank you, Presiding Officer. Minister, in spite of the self-congratulatory tone of the response that you have just given to Sandy Mewies’s question, there are particular problems with people waiting for urgent cancer treatment via the urgent suspected cancer route. That target has not been met since 2008, in spite of promises by the First Minister on two occasions that the target would be met by March 2013—a promise that was broken—and then by October 2013. You have today announced the potential abolition in the future of that particular target, and a single treatment pathway with a different target instead. Can you put a bit more meat on the bones of that and flesh out precisely what your intentions are?
I thank Darren Millar for that question. There is nothing wrong at all with congratulating services in the Welsh NHS when they do such a fine job. Sometimes, Members on the Conservative party benches would do well to remember that, because their views are also heard by people who work in the NHS. However, I am grateful for the opportunity— [Interruption.]
Y Llywydd / The Presiding Officer
I am grateful for the opportunity that Darren Millar’s question has given me to put on record what has been announced today. It should have come as no surprise to Members, because I have said on more than one occasion in the past that we intended to bring forward these proposals. It might be useful to spend a moment reminding Members of the history of this.
Last year, I received a letter from leading cancer clinicians in many parts of Wales saying that they believed that there was a better way of measuring the way that we provide services for patients that would improve the outcomes for those patients. They asked me whether I was prepared, as Minister for health, to work with them on designing a new way of doing things that would lead to that improvement. I cannot imagine that anyone in this Chamber would think that it would have been a good idea to have turned down that offer from our leading cancer clinicians. As a result of the work that they have been leading—and it has been led by clinicians themselves—what I have announced today, to answer Darren Millar’s question, is a pilot project. It is not even a pilot project on something that has been finally agreed; it is a pilot project to test some of the ideas for improvement that those clinicians have devised. We will run it not instead of, but alongside the system that we have at the moment. So, everything that we report now will continue to be reported while this pilot project and testing period is being carried out. It will last for six months. At the end, if clinicians are clear with me that they are sure that there will be things that they will want to look at again and to make further suggestions to us upon, they will report on that to me and I will report on that to the Assembly Chamber.
Minister, no matter what way you try to dress it up, it is an admission of failure because you have failed to achieve or hit the targets for so many years. It is hardly surprising that 15,000 people per annum are now fleeing Wales to seek treatment over the border in England. The figure has quadrupled over the past decade. Will you accept that one of the biggest challenges faced by patients is access to cancer treatments in terms of the drugs that they have available? What is your response to the high-quality research by Bristol university, which was published last week—in fact, published earlier this month—and which made it quite clear that Welsh patients are now seven times less likely to be able to access a cohort of cancer drugs that are available through the cancer drugs fund in England. Will you now concede that there is a need for a similar fund to be established in Wales in order to maximise the benefits that people are able to experience from access to modern cancer treatments?
I do think that it is a terrible shame when a Member here asks a sensible question, receives a sensible answer to it, then takes absolutely no notice of what he has been told and, instead, departs into those realms of fantasy politics in which his party is such a devotee. Let me deal with his last point first. As it happens, I have here a copy of the article to which he referred. I noticed that he did not tell the Chamber that it describes the cancer drugs fund in England as ethically dubious, clinically highly contentious, and unsupported by the public. [Assembly Members: ‘Oh’.] I noticed that he did not tell us that, but it is all here in the copy that I have and which I have actually read. That is what the researchers conclude about the fund that he is so keen for us to set up in Wales.
Let me tell you what else it says. It compares the cancer drugs fund in England with the way that we deal with cancer drugs in Wales. It tells you that, in England, you are more likely to get access to drugs that have not been approved and are not thought to be effective by NICE. In Wales, you get faster access than you do in England to drugs that have been approved and are thought to be effective by NICE. What would you rather have as a patient? Faster access to drugs that do not have a record and are not effective, or drugs that do have a successful record and are effective? I can tell you what I would prefer if I was a patient. [Interruption.]
Y Llywydd / The Presiding Officer
Order. I think that the Minister is answering questions fairly. I think that the background noise does not help and, so, you cannot always hear what is being said. I now call Elin Jones.
Minister, you have confirmed this afternoon that you are going to run a pilot on changing the cancer target system. Thank you for confirming that to us here. Your officials have briefed the press and you released a press statement at midday today. In fact, it seems that, according to that press release, this scheme has been implemented since 1 May, which was last week. I am rather stunned that, once again, you did not give us a formal statement before today’s questions so that we could have scrutinised you seriously on this.
Following on from what you have just said to Darren Millar, namely that you intend to continue to run this pilot scheme alongside the current system over the ensuing six months, until you take a final decision, will you confirm this afternoon that your intention in the long run, whatever your decision may be in six months’ time, is to continue to release data and collect data about the 31-day and 62-day regimes so that we can make comparisons with other NHS systems in the United Kingdom, in accordance it with the important recommendation made in the recent Nuffield report, which you welcomed?
What I can say to the Member is that while we are in this developmental phase—and it is something that we will do carefully, and we will take all the time necessary to develop something better than we have now—we will continue to report what we report at the moment. Where she is mistaken, I believe, is in thinking that what we have now is comparable to places in other parts of the United Kingdom, because it is not. We are not comparing like with like, even on the 62 and 31-day targets. If clinicians were, in the end, in all seriousness, to say to us in this Chamber that there is a better way of measuring things that provides more effective services to patients, would that not be a more persuasive argument than simply wanting to stick to things that clinicians tell us do not deliver better services to patients? However, for the foreseeable future, while we are doing this in a developmental way, we will continue to report as we have in the past, as well as providing Members with all the new information that will come from the work that clinicians are now leading.
Minister, the Welsh Government's current cancer waiting time targets focus on the wait between diagnosis and treatment beginning, but, of course, from the patient’s perspective, that journey begins way back, at the GP's surgery, when they are told that a cancer is suspected and that they have being referred for diagnostic testing. If the new measurement regime is to be an improvement on what has gone before, and if you want it to lead to better information for policy makers and better outcomes for those patients, will you agree to include targets and monitoring for that waiting time between referral and diagnostic testing beginning, specifically where a cancer is suspected?
It is an important point that the Member makes about the performance of primary care in relation to cancer services. We have already begun to do some of the work that she has pointed to this afternoon. In the new GP contract that we have agreed with GPs in Wales, which began on 1 April, we have a new agreement that all GPs will participate in a national care pathway to review the care of all patients newly diagnosed, between 1 January this year and 31 December this year, with lung or digestive system cancer. We decided to focus on those two because they are some of the places where the cancer experience survey told us that people had some of the less satisfactory experiences. We will use the work that we will do there to try to capture some of the data that Eluned Parrott has referred to this afternoon, because it is absolutely clear that if you want to get the best outcomes for patients, you have to make sure that primary care is quick to act, quick to spot cancer when that may be the risk, and then to put the rest of the system into action.
I am sure that no-one in this Chamber can deny the Government's commitment to cancer care following the announcement yesterday of the £200 million to develop Velindre Cancer Centre. However, moving on to the waiting lists, does the Minister agree that it is very important that the developments that he has announced today have actually been led by clinicians, such as Tom Crosby from Velindre hospital, and that he is responding to a medically led request?
I thank Julie Morgan for that. She is absolutely right to point to the importance of Velindre—a specialist cancer centre that is leading the way on a European level in terms of the quality of the services that it provides. Dr Tom Crosby has been one of the leading clinicians in developing the new ideas that we have put into the public domain today. I was very keen to make sure that he was available to explain to those whose job it is to explain this onwards to members of the public what it is that clinicians are proposing, because this is very much, as Julie Morgan said, a clinically initiated and clinically led initiative.
I do not expect you to comment on the individual case, but a constituent of mine has been waiting for months for a colonoscopy. The results were not conclusive and there will need to be further investigations. He has now gone to the back of the next queue. If he were willing to pay, the same specialist who is treating him would be willing to arrange a procedure within weeks at the same hospital. Why is the Labour Government overseeing a system that provides better healthcare to those who can pay for it?
I heard what the Member said, but without having sight of the details and the background to the case that he is raising, it is impossible for me to answer the question. If he wishes to write to me, because he is raising important issues—
Well, I have not seen the details at all, but I am happy, if the Member were to write to me, to look into his question and answer him in full, because the points that he has raised are important.
7. Will the Minister make a statement on ambulance resources in north Wales? OAQ(4)0428(HSS)
Thank you for the question. North Wales, like other parts of the country, will benefit from the early decision of the health boards to provide an additional sum of £7.5 million for ambulance services in Wales in this financial year.
Thank you very much for that response. I could give you a number of examples of the stress put on the service in north Wales—the constituent of mine, for example, who has had to wait an unacceptably long time for an ambulance for her husband twice recently—but what I will do instead is talk about what the ambulance service staff on Anglesey are telling me, that is, that they have to spend more and more time off the island serving other areas across north Wales because of a shortage of resources. Does the Minister agree with me that we need to build greater capacity into the ambulance service, rather than the service always having to work to the limit of its resources, and beyond its resources regularly?
It is important to build on past performance and to give more resources to the ambulance service where we can do that.
Across the period of devolution, the number of staff directly employed by the NHS in Wales has risen by 30%. The number of staff employed by the Welsh ambulance service has risen by exactly twice that amount. For every one person who is employed extra in the Welsh NHS, two extra people have been employed by the ambulance service. The extra money that was made available to the Welsh Ambulance Services NHS Trust in the last financial year led to an extra 92 staff being employed over the winter. The £7.5 million that has been agreed early this year as extra resource for the ambulance service will support the recruitment of an additional 119 front-line staff for ambulance services in Wales. North Wales will have its fair share of that extra resource.
Minister, whilst clearly it is good news that numbers are rising in the Welsh ambulance service, there are clearly other bottlenecks that are affecting the ability of ambulances to achieve their waiting time targets. A radiographer at Glan Clwyd recently described 12 ambulances waiting outside the hospital to discharge their patients into A&E. What proportion of the £7.5 million will be looking at the bottlenecks in the system to make sure that there is a smooth transfer? That may well be an explanation as to why ambulances are having to move from Ynys Môn and other parts of north Wales to cover the ground, as it were.
Antoinette Sandbach echoes a point that I made earlier this afternoon when I referred to the impact on ambulance services of delays at Cardiff’s accident and emergency department. She is absolutely right to say that the ability of the ambulance service to discharge its responsibilities depends on other parts of the service discharging theirs in a timely fashion too. The £7.5 million is all for the ambulance service itself, but we are making other investments in other parts of the system that ought to make sure that some of the delays that are caused in other parts of the system are also borne down on. She is absolutely right to point to Ysbyty Glan Clwyd as a hotspot in all of this. She will be aware of the fact that, right through the winter, the new emergency quarter at that hospital has been under construction. It will come on stream over the next few weeks, and I am told, having visited it and spoken to the senior staff there, that the new building they will have will have a direct bearing on the ability of that hospital to take patients from ambulances in a timely fashion and to get those ambulances back on the road to do the job that we need them to do.
Minister, it is not just a matter of ambulance men or women having to go from Anglesey to Gwynedd. I had a case about three weeks ago when a crew from Buckley had to travel to Conwy in order to take a patient to Ysbyty Gwynedd, because of problems at Maelor hospital and Glan Clwyd Hospital. The ambulance service admits that there was a shortfall of about 27 staff members just to deal with normal problems, rather than these intense problems. Will this additional funding enable the ambulance service to recruit? It said, about three months ago, that it was not willing to take that decision while there was any difficulty regarding funding.
That is why it has been so important to reach agreement with the local health boards to provide the funding to the ambulance service early in the financial year. This is where we can see a new way of running the ambulance service, which has emerged from Professor McClelland’s report, working on the ground. The funding is available to the ambulance service and it can continue with the work of recruiting people who will be working on the front line. That will have an impact throughout Wales.
8. Will the Minister make a statement on the rate of teenage pregnancy in Wales? OAQ(4)0431(HSS)
Recent data show that teenage conception rates in Wales for girls aged under 18 have fallen to 30.8 per 1,000 girls aged between 15 and 17 years of age. That was in 2012 and had fallen from 34.2 in 2011 and 36.9 in 2010.
It is really good news that teenage pregnancies in Wales appear to be at an all-time low, but I am concerned at the significant regional variation across Wales. Rhondda Cynon Taf, for example, has one of the highest rates in Wales. More work needs to be done to educate both girls and boys. How does the Minister think we can do this and ensure that we are speaking to those groups who have previously been the most difficult to reach?
Christine Chapman makes an important point that these figures do vary from one part of Wales to another. It is also important to say that there have been falls, and a similar rate of fall, in all parts of Wales, although some parts of Wales started with a higher rate in the first place. These are good-news figures. Of course, we need to do more in educating young men as well as young women. Ferndale Community School in the Cwm Taf area is a good example; it is working with local agencies such as Communities First to support young people and parents. It has a condom card scheme and it runs a health and wellbeing clinic at the youth centre next to the school. It tries to provide the services at a place and in a way that makes it genuinely accessible to those young people we are so keen to reach.
It is good news, the reduction—you know, young ladies’ pregnancy rates coming down to 36%. Since teenage pregnancy can be associated with poor educational achievement, poor health, social isolation and—the biggest and worst—poverty, what plan does the Minister have to reduce this rate further in Wales?
We are very keen to go on making further progress in this area because a pattern has emerged over many years of a year-by-year decline. I cannot help but be struck by the irony of a Conservative Party Member telling me that poverty is a cause of teenage pregnancy, because we are walking against the hill of the problem that they are creating in trying to go on making the progress that we have made.
Minister, while the rate of teenage pregnancy is falling, the latest figures from the Welsh Government show that there has been a general increase in the number of diagnoses of sexually transmitted infections among young people in Wales. What lies behind those figures? Is it the result of increased testing or do we need to look again at the way in which we educate young people about the risks of STIs and how to avoid them?
I thank Rebecca Evans for that question. She points to a complex area that can be difficult to analyse. It is of course a matter of concern that since 2010 there has been a general increase in the number of diagnoses of sexually transmitted infections in Wales. However, when you look into the detail of the figure, what you find, as I think that the question suggested, is that, very often, the rise in the identified number of diagnoses is closely mirrored by the number of investigations that are being carried out.
If I could offer just one set of figures, the number of young women who have been tested as positive for chlamydia increased by 21% between 2010 and 2012. However, in the same period, there was a 26% increase in the number of young women coming forward to be tested. So, it is not always easy to distinguish between whether this is just better testing, and, therefore, we are just finding out more, and whether there is genuinely more of this in the community. What is certain is that, either way, there continues to be a major public health job to be done here in making sure that young people understand the risks that are there and take the actions that can be taken to avoid them.
Improving Services for Cancer Patients
9. What action will the Minister take to improve services for cancer patients in Wales in 2014? OAQ(4)0423(HSS)
Renewed action to improve early diagnosis of cancer in primary care and greater consistency in the provision of named key workers to those undergoing treatment are among the key priorities for 2014.
Thank you very much, Minister. Earlier, you said to one of our colleagues that you believe in research work. Research by Bristol University has revealed that cancer patients in England are up to seven times more likely to get costly life-extending drugs, thanks to the cancer drugs fund in England. Will the Minister now listen to groups such as the Rarer Cancers Foundation and the charity Breakthrough Breast Cancer and introduce a cancer drugs fund in Wales to stop Welsh patients missing out on these much-needed treatments?
I think that I have answered the question already this afternoon. I have no intention of moving from a position where Welsh patients get faster access to proven and effective treatments and replacing that with faster access to treatments that are neither proven nor effective.
Minister, 80% of breast cancer cases occur in women who are postmenopausal, and the risk of developing breast cancer continues to increase with age. So, can you outline what the Government is doing to ensure that more older women in Wales attend breast screening?
I thank the Member for that very important point. Members here will know that, in 2012, there was a £10 million investment from the Welsh Government in Breast Test Wales, so that we now have the only fully digitised breast screening service in the United Kingdom. In the last years for which figures are available, we know that 93,000 women aged 49 or over were screened. That was in 2012-13, and that was 10,000 more than were screened in the year before. So, I think that we have always had a service that we can be proud of in Breast Test Wales, and it continues to demonstrate its worth.
Minister, however you decide to measure cancer waiting times, rural cancer patients in my constituency have to travel considerable distances to access cancer services—travelling to Cardiff, Hereford and Cheltenham. Could you give us an update, please, on the ability to offer some chemotherapy services out of the community hospital in Llandrindod Wells, which would make a massive difference to the experience of cancer patients during their treatment?
I thank Kirsty Williams for that question. I am concerned at some aspects of the service that we are able to offer Powys residents. Where Powys residents receive their cancer treatment in Wales, 100% of them are treated within the 31-day and 62-day targets. However, when patients are receiving a service in England, and quite a significant proportion of patients in Powys do that, then only 66% of them are being seen within 62 days. That is a matter of considerable concern to me, and I am in discussions with Powys Teaching Local Health Board about ways in which we might be able to address that position.
I have also had discussions directly with the chair of Powys health board about Llandrindod and the possibility of outreach services there. I cannot give the Member the final details today, but I can say to her that that conversation left me optimistic that there are realistic plans coming to fruition shortly that will be able to do exactly some of the things that she has outlined this afternoon.
10. What assessment has the Minister made of the recommendations of the Nuffield Report on data collection in Wales? OAQ(4)0436(HSS)
There are no recommendations in the Nuffield study that refer to data collection in Wales. The report states clearly that spending money on data collection means, obviously, that the money is not available for patient care and that those costs will have a greater impact in a time of financial stringency.
The Nuffield report emphasises the need to ensure that data can be compared and that data are gathered consistently, year on year. I would hope that that would allow us to have a far more intelligent debate on health in Wales, rather than some of the more extreme accusations that have been made over the past few years.
In terms of data, when we look at GPs, Nuffield tells us that the level in Wales, that is, 0.65 to every 1,000, is lower than that of any other part of the United Kingdom. Nuffield is based on data from 2011, and the information from the Welsh Government states that that figure has now fallen to 0.6 in every 1,000. What do you intend to do about this, and how will you respond to demand in terms of ensuring that there are more GPs available in Wales?
The Member is right that the final part of the Nuffield report does propose a series of data collection issues—which are not for Wales, but for all four of the home nations—that would allow better comparison to be made in some instances. I had a very interesting conversation with the Scottish Minister for health on this point. He told me that he had no interest at all in that part of what was being proposed, and you can see why, in some ways. Even with comparative data, depending on how you interpret the data, you can come to very different conclusions. The report says what Rhodri Glyn Thomas said it says about GP recruitment, but it does not say—which it could have said, because that interpretation was there too—that the increase in the level of GP availability per 100,000 of the population has risen faster in Wales than in any other part of the United Kingdom. We have had an 11% increase in the GP workforce over the period since devolution, and we have had a further increase in the last year. That, in itself, disguises some hotspot areas where recruitment is difficult and there is more that we can do.
I come back to the point that I have made many times in the Chamber: information is one thing, but explanation is another, and, actually, what we need is a bit more effort, sometimes, to explain and understand the data we have, rather than always worrying about different ways in which those data might be collected.
I heard what you said, Minister, about your interesting conversation with the Scottish Minister, but the Nuffield report does clearly call for comparable data so that there can be comparisons made by the people who use the health services across the United Kingdom, and, from our perspective, importantly, by the people here in Wales. The Welsh Government, for whatever reason, is looking to change its benchmarking and its own targets, and a cynic might say that that is because you cannot hit the current ones. However, are you committed, as a Minister, to making the data as transparent as possible and, above all, to trying to meet some of the sentiment in the Nuffield report for those comparisons to be made so that the people who use our health service and, importantly, the people who work in our health service, can improve or celebrate the successes that need to be celebrated where they exist?
Thank you for that final point. Let me divide what Andrew R.T. Davies has said into two parts. I am completely committed to transparency. I am very committed to making as many data, with proper explanation, available as we can in Wales, and we have made big strides in that regard over the last 12 months. What I am interested in is the performance of the Welsh health service, for which I am responsible. Where other people make changes to data, I cannot be responsible for that. The pursuit of comparability is, in some ways, the pursuit of a chimera, really. Where we can produce comparable data and where genuine comparisons can be made and where that is helpful, I am all in favour of it. However, no one Minister for health can guarantee that, because, just as there may be changes that we would have in Wales, you can be sure that there are changes being proposed and discussed in every other health service in the United Kingdom, and that in itself creates tensions between wanting accurate data on what you are doing in your own part of the world and being able to compare that in a realistic way with what happens elsewhere.
11. Will the Minister make a statement on dialysis services in Wales? OAQ(4)0433(HSS)
Significant investment continues to be made across Wales to modernise dialysis services, improving environments for patients so that they receive care fit for the twenty-first century. An example is the recently opened renal dialysis unit in Merthyr Tydfil at a cost of more than £2 million.
Thank you, Minister. I was pleased to join you on your recent tour of health services in west Wales. The region does have a good story to tell about dialysis services at the moment. We have the new unit at Withybush and the introduction of a life-saving treatment technique at Glangwili. Minister, are you able to tell us today when the Withybush unit will open to patients? Hywel Dda LHB has said that it will be in the summer, but have you been given an actual date?
I thank Joyce Watson for that. We are very close to the end of the tendering process that has been going on in west Wales and which will lead to improvements at Withybush and also in Carmarthen and, indeed, in Aberystwyth at Bronglais as well. As soon as the tender is finally signed by the local health board, there will be a short number of weeks before the unit at Withybush becomes operational. I am confident that that will happen during the month of July.
Minister, I too am pleased that this new renal unit at Withybush hospital will be opening some time in the summer. It will, of course, make a huge difference to renal patients in Pembrokeshire. However, can you tell us why there will be a delay in actually opening the unit given that the building has now been completed? Why could it take up to three months before it is fully operational?
Well, I have shared some of the Member’s frustrations at the delay there has been at the unit. The reason lies in the development of a contract that would not just bring about improvements at Withybush but allow for the investment in new equipment at Carmarthen and ensure that the new Padarn unit in Aberystwyth is also brought on-stream in as timely a fashion as possible. Making all of those three things happen together has introduced some additional complexities in the contracting. However, in the longer term, they will deliver more benefits and outweigh the delay. I was pleased to be joined by the Member when I was in Pembrokeshire on the day that I went to see the building as it was developing in Withybush. It is a further sign of this Government’s determination that that hospital as well as others in west Wales will go on providing services for patients into the future.
Yr Arglwydd / Lord Elis-Thomas
May I thank the Minister for the investment in north-west Wales in the dialysis units in Ysbyty Gwynedd and particularly the continuing investment in Alltwen Hospital, which will mean that people who need treatment will not have to travel for two hours back and forth? However, is there not an opportunity here for the Minister to explain more clearly to people the importance of community hospitals, which are a spoke in the wheel for all sorts of different services so that people then understand that this is the meaning of the reconfiguration of health services?
Well, I am grateful for a chance to do that. I am very pleased that we have been able to make that investment at Alltwen, and I have received correspondence since from individuals who have described the difference that that has made to their lives in terms of travelling time and so on. Community hospitals are often ideally placed to provide these sorts of services. I was very lucky earlier in the summer to be able to open the new facility in Powys as well. It was the result of investment that was originally identified by Edwina Hart when she was the Minister for health. These things can take quite a while to come to fruition but, when they do, they make an enormous difference to the local population.
Y Llywydd / The Presiding Officer
Thank you, Minister.
1. What assessment has the Minister made of the impact European Structural Funds have had on tackling poverty in Islwyn? OAQ(4)0173(CTP)
I thank the Member for the question. We believe that European structural funds have had a positive impact on tackling poverty in Islwyn. For example, projects across the Caerphilly county borough area, which includes Islwyn, have assisted nearly 43,000 individuals, many of whom have gained qualifications or have gone into employment. For example, the Caerphilly passport programme is part-funded by the European social fund, and future ESF funding will have a commitment to allocate 20% of its funding to tackling poverty.
Thank you for that answer. The Deputy Minister will be aware that the recent audit report from the Wales Audit Office on European funds shows that schemes are generally doing well. Does he agree with me that this demonstrates the added value to communities in Wales of continued membership with the European Union, and that the best thing for people to do on 22 May is to go out to vote—Labour? [Assembly Members: Hear, hear.]
The Member makes an important and eloquent point. It is right to point out the significant benefit that Europe does provide. We recognise that the biggest defence against falling into poverty is having well-paid employment. The Member will clearly have constituents who work at GE Aviation—a large employer, which has had significant benefit from our being members of Europe. It has had access to Skills Growth Wales and to the modern apprenticeships schemes, helped, in part, by funding from Europe. I would absolutely encourage people, of all political persuasions, to go out on 22 May to vote.
Y Llywydd / The Presiding Officer
I am glad that you just stopped at ‘vote’. Thank you very much. I call on Mohammad Asghar.
Deputy Minister, at present, EU structural funding has predominantly gone to third sector and public sector projects. Does the Minister agree that tackling poverty in Islwyn would be much more effective by greater engagement with the private sector, utilising its expertise and experience, when developing funding schemes here?
The Member will have heard me confirm that 20% of the next round of structural funds will be allocated to funding to tackle poverty. The majority of the funding actually goes into private sector businesses. In particular, the focus on skills and employability will continue to play a significant part in how our European funds are used. However, I am pleased to recognise that the latest audit office report did say that these funds are now being well managed and well spent.
As someone who will be voting as well, Minister, I note that some Westminster politicians have argued that EU structural funding should be taken from Brussels and controlled by Westminster. As Westminster policy makers do not exactly have a reputation for policies that focus on redistribution and tackling income and economic inequality, this could seriously impact on our poorest communities, in particular in places like Islwyn. How will you be ensuring that this does not happen?
We are looking at managing the next round of structural funds here, in the Welsh Government, with our own responsibilities. You will have heard the response from the First Minister yesterday, setting out a positive case for staying in Europe, and stating the benefits for places like Islwyn of Wales of being part of a member state within Europe. We do not envisage any change to the nature of structural funds in the way that they are managed from Europe to regions and nations.
2. Will the Deputy Minister make a statement on rural poverty figures in Mid and West Wales? OAQ(4)0170(CTP)
The Member will be aware that updated indicator data for the Welsh index of multiple deprivation was published on 1 May. We remain committed to tackling poverty in all parts of Wales. I was delighted to join the Minister for Natural Resources and Food at a rural development plant consultation event last month, where we reiterated our commitment to tackling poverty in rural Wales.
I am very grateful to the Deputy Minister for that response. I am sure that he may well have been made aware that National Energy Action recently published a UK report on monitoring fuel poverty for 2013-14. If he has, he will undoubtedly share my concern about some of its contents, particularly relating to the fact that the number of households in Wales in fuel poverty has steadily been rising since 2004.
A particular issue of concern in rural areas, such as Mid and West Wales, is exacerbated by the fact that we have the three Welsh national parks, which sometimes impose additional gold-plated requirements, which make it difficult to retrofit properties with energy-saving measures. In that context, will the Deputy Minister undertake to work with his colleagues in Cabinet—those with responsibility for the national parks, as well as those with responsibility for planning—to ensure that these matters can be addressed, so that retrofitting is not made additionally difficult for those residents?
I think that the majority of that question is really a matter for the Minister with responsibility for planning. However, I am happy to confirm that I continue to work with colleagues across Government on tackling poverty. You will have heard reference in statements made yesterday, and in the reference that I made earlier today, to work with the Minister for Natural Resources and Food, who also has the responsibility for our programmes to help tackle fuel poverty. Again, those schemes are part funded by European money. So, again, that repeats the point from the first question, namely that there is value in Wales being part of a member state that is very definitely in Europe.
Fuel poverty continues to be a challenge in rural areas and councils face specific issues in effectively delivering services in rural areas compared with mainly urban regions, I would suggest. Given that there was no single rural-proofing document for the tackling poverty action plan, how is the Government ensuring that it is flexible enough to deal with the challenges of each area of Wales and what steps are being taken to deal with fuel poverty in rural Wales?
Fuel poverty is an issue in rural and urban Wales. Sticking to rural Wales, we have a clear policy programme that is there to benefit communities in rural Wales. We have ongoing research to help us understand more about the work of rural Wales. The external tackling poverty advisory group is doing a piece of work to help inform what we are already doing and future Welsh Government action. This is very much an issue on our agenda and our commitment to tackling poverty in rural Wales remains clear, definite and consistent.
Deputy Minister, although the intensity of poverty is not as acute in rural areas compared with the post-industrial areas, it is clear that there are individuals, families and children who are poor in constituencies such as mine in Ceredigion. Given that your funding policy tends to target areas with intense poverty, it runs the risk of depriving and not meeting the needs of poor people in rural areas. For example, Citizens Advice in Aberystwyth has had to close its office recently and there is no credit union presence in Aberystwyth. Those are two important services that should be available in a town as strategically important as Aberystwyth. Will you therefore work with these organisations as a Government in order to ensure that they can, over time, develop their services in an area such as Aberystwyth?
Yes, we want to see services available to the poorest families and communities right across Wales. Some of the particular points raised are, of course, areas on which I work with the Minister. However, it is fair to point out that, of the key anti-poverty programmes, there is a clear footprint in rural Wales. For example, there is Families First, which is active in every single local authority. I have visited Aberystwyth and seen what Families First is already doing. I have seen the work that Flying Start is doing in Aberystwyth as well. It is not correct to say that this Government does not take issue with rural poverty and does not have a particular programme of action to try to address the causes of rural poverty right across Wales.
3. What discussions has the Minister held with the UK Government in relation to safeguarding Post Offices in Wales? OAQ(4)0166(CTP)
I thank the Member for the question. I have held no discussions with the UK Government as this is not a devolved matter. Nonetheless, we have supported post offices through the post office diversification fund, providing £6.3 million of funding to date. I am currently considering applications made under the 2013 funding round.
Thank you for that. I accept that this is not a devolved matter but the Scottish Government has extended its scheme in order to deal with businesses such as the one in the Ceiriog valley that do not meet the guidelines of the Government and the Post Office. Would you be willing, therefore, to review the way in which the scheme is operating in Wales at present in order to see whether there are any additional lessons to be learnt from Scotland?
I am always content to review schemes if evidence is produced that we could do something in a better way. However, I can say that I have had discussions with Post Office Limited and the National Federation of SubPostmasters. They have not come forward with any such suggestion.
Y Llywydd / The Presiding Officer
I call the opposition spokesperon, Mark Isherwood.
As you indicated, this is primarily a UK Government responsibility, although, clearly, you have had the post office development fund support over the last two Assemblies. The UK Government has committed some £2 billion to ensuring that the network stays open and that we support the 11,500 plus post offices and access to services in communities. However, concerns are regularly raised that when a sub-postmaster or independent operator retires or closes their business other operators or people do not come forward regularly to apply. What discussions have you, therefore, had with the Post Office to identify what those barriers might be and to see how the Welsh Government could possibly help them overcome them?
Thank you very much for that question. It is a matter that we take very seriously, and, as I have indicated, I have had discussions with Post Office Limited and the National Federation of SubPostmasters on this and a range of matters. We know, for example, that in terms of the Crown post offices, the network in the UK is currently losing £37 million per annum. Much of this is because of the way in which people now access services through the internet et cetera rather than over the counter in post offices as they would have traditionally done over the years. So, there are major changes. In terms of Wales now, however, there will be three ways that sub-postmasters can apply to be in charge of their post office—main post offices, which we are familiar with, local post offices in retail outlets, and now community post offices where there is no retail output within half a mile and where special facilities can be developed. Indeed, there will be a resource of £10,000 per annum to those who take charge of community post offices.
This was raised for instance—[Inaudible.]—with a successful outcome in Brymbo, in north-east Wales, for example. However, only 20 of the post offices in Wales are Crown post offices, and the wider concern, therefore, is about delivering sustainability. As part of that, for the last 11 years, since I have been in the Assembly, we have heard the Welsh Government and the post office talking about working with credit unions and delivering services in post offices. The Welsh Government and the UK Government are supporting funding for sustainability in credit unions, and also, as you have just indicated, there is the push to deliver sustainability in post offices. When are we going to see action to turn that rhetoric that we all support into real services in our communities?
I thank the Member for that question and he raises a very good point indeed. This is something that I am actively engaged in, both in terms of discussions with the sub-postmasters, and, indeed, with the credit union movement, to see how we can get the best delivery of key public services on a one-stop-shop basis where that is possible. So, that is a matter that I will be returning to and I will keep the Member informed.
Minister, I am very pleased to hear that you are going to carry out that assessment of the way in which services can be delivered in a one-stop shop, because what happens in very many of our communities now is that services are disappearing. For example, in the market town of Llandeilo recently, one of the high street banks closed and referred its customers to the post office. Will you make an effort, Minister, to ensure that those basic services remain, not only in our market towns, but also in our rural villages?
I will be happy to do my very best in that regard. What I cannot control, in terms of the services of post offices as opposed to the buildings, is how people access them and tend to use them; I cannot control that because there are so many other ways now for people to access services, for example over the internet. I am also concerned with the issue of the spread and availability of credit unions and I will want to look at ways in which those issues can be shared.
I accept, Minister, that the service as such is not devolved, and I also accept that you say that you cannot control people’s habits, in terms of the way that they access services. However, in situations where that service is the only service that is available—and very often by now in our villages we see volunteers running that service—will you make an effort to look at the way in which the Welsh Government, across the portfolios, assists people to ensure that that service continues?
I thank the Member for that question and assure him that I will do my very best in this regard and work with other Ministers to see what we can do. However, I did refer in an earlier answer to the development of the new community post offices, and we hope that that is an initiative that can be developed further, together with other ways of working.
Digital Inclusion Programme
4. Will the Minister make a statement on the progress of the Welsh Government’s Digital Inclusion Programme? OAQ(4)0165(CTP)
Thank you for that question. Good progress is being made towards tackling digital exclusion. The percentage of Welsh adults not regularly using the internet has fallen from 34% in 2010 to 24% in 2013. Communities 2.0 continues to support the most digitally excluded groups and has helped over 39,000 individuals benefit from the internet.
Thank you, Minister, for that answer. In recent meetings that I have had with groups that represent people with disabilities, they have highlighted the importance of libraries in terms of providing access points for internet services and computers in particular. We are all aware that libraries are under severe pressure from local government settlements. They told me that the Welsh Government has done no work to establish the overall use of libraries by people with disabilities, in particular in the field of digital inclusion. Are you minded to undertake such a piece of work so that there is a greater understanding of the important role that libraries, and in particular having access to the internet, offer groups who suffer from disabilities in our communities?
You make an important point about the role of public libraries, and I acknowledge that. A month or so ago, I was pleased to attend the official opening of the new Caerphilly library and which my colleague, the Minister for Culture and Sport, attended to undertake the official opening. I can say that while the matter you raise in terms of libraries is one for my colleague, the Minister, it is something that I have already raised with him and on which I will have continuing discussions.
There is some frustration no doubt at the pace of the Superfast Cymru roll-out in parts of rural Wales but, of course, we are being told that we are still on track. However, there is some concern that digital inclusion measures, as well as measures to make sure that businesses and so on take advantage of the opportunities provided by being online, are not keeping pace with infrastructure developments. What assurances can the Minister give us that this is being addressed?
Thank you very much for that question. Again, that is a very important point. Of course, my colleague, the Deputy Minister for Skills and Technology, is responsible for the roll-out of Superfast Cymru. I am discussing these matters with him because, clearly, as Superfast Cymru rolls out, it presents some excellent opportunities for us to expand the information to include Communities 2.0 and the other appropriate benefits of access to the internet.
The digital inclusion delivery plan was published back in March 2011 and was designed to be a working document to guide all interventions in this area, including a section that is supposed to be updated to provide a progress report. However, that plan, despite setting a number of targets for reduction in digital exclusion that were supposed to be met back in May 2012, has not been reported against. In fact, that plan and the web page that it is on, have not been updated since March 2011. Is that delivery plan now dead or is it resting? If it is not dead, why have you not reported on progress against the targets that are listed within it?
Thank you very much for that point. I will ask officials to look into the information that is posted on its web page straight away. I can, however, assure you that it is not dead and neither is it resting; it is in the process of being refreshed. However, as you acknowledge, a number of targets have already been achieved. The revised and refreshed digital inclusion delivery plan, including revised targets, will be published this summer.
5. Will the Minister make a statement on the Welsh Government’s progress in relation to sustainable development? OAQ(4)0164(CTP)
I thank the Member for that question. Sustainability and ensuring the right long-term development path for Wales is at the heart of our programme for government. I look forward to welcoming Members’ views on the latest sustainable development annual report when we debate it in July and look forward to introducing the future generations Bill shortly thereafter.
The term ʻsustainable development’ is included in two Welsh Acts. What is the Welsh Government’s definition of the term ʻsustainable development’ now?
You are quite right—we do have the ‘One Wales: One Planet’ definition. It is likely that, in terms of the face of the future generations Bill, it will be the Brundtland definition that will appear.
Sustainability is supposed to be at the heart of the Assembly’s constitution and everything that we do here, yet, a recent Eurostat report has shown that parts of west Wales and the Valleys are now poorer than parts of Poland and eastern Europe. Do you agree with me that your Welsh Government needs to refresh—to use that term—its approach to the use of EU structural funds to make sure that the next round of structural funding that the Deputy Minister said earlier was so important is used to much better effect, so that the Welsh economy is far more sustainable over the next 15 years than it has proved over the last 15 years?
I thank the Member for his comments. I have a feeling that I am going to regret using the word ‘refresh’, but I will refresh my view on that at the end of the questions. However, you raise an important point. I can tell you that 20% of the new ESF round of funding must be used on schemes that clearly target the poverty agenda. I am in regular discussions with my colleague the Minister for Finance on this matter.
However, sustainable development will be at the heart of our future programmes and, indeed, this will be reinforced by the future generations Bill that I will introduce on 7 July.
6. Will the Minister outline his priorities for improving community relations in Wales in the next twelve months? OAQ(4)0160(CTP)
I thank the Member for that question. I will be launching a national community cohesion delivery plan on 5 June 2014. It will aim to tackle community tensions and increase engagement with people with protected characteristics. I have announced funding for eight regional community cohesion co-ordinators to support delivery.
Thank you for that answer, Minister. Figures reveal that, in the last 10 years, Wales’s foreign-born population has risen by 82%. Merthyr Tydfil saw its migrant population increase by 227%—the second biggest percentage increase of anywhere in the United Kingdom. What studies has the Welsh Government undertaken into the effect of migration on communities such as Merthyr Tydfil to see whether extra resources need to be allocated in the interests of good community relations here?
The very purpose of our community cohesion strategy is to make sure that public services are delivered as effectively as possible with regard to the need of the make-up of that community.
There are a number of issues in terms of the figures that you raise. There are tensions, sometimes, which are whipped up by others and, certainly, through initiatives such as the hate crime framework, we will be doing our best to make sure that public services work together to tackle discrimination and victimisation.
Minister, when we talk about community relations in Wales, in this thirtieth anniversary of the miners’ strike, would you agree that many of our communities still suffer from the terrible legacy of a strike that was engineered by the Tory party? Of course, many of those cheerleaders from that particular time are now in UKIP and have done so much damage to our working-class communities. It is about time that Wales was given an apology for the engineered strike, as we now know it from the disclosed Cabinet office papers.
Thank you very much for that question. Indeed, I am old enough to remember the strike, as a much younger adult when the miners’ strike was on. I was living in the community of Ystrad Mynach in the Rhymney Valley at the time, and the local Penallta colliery was very heavily, shall we say, protected by a national police force, and that tore the local community apart because of the way in which the mining industries and their associated industries were attacked and closed. We are definitely living with the impact of those effects to this day, and that is another example of how industrial policy and political policy can damage community cohesion.
Deputy Minister, in the last few weeks, far-right fascist organisations have made applications to both Swansea and Cardiff councils to hold demonstrations in the city centres. In Swansea, they were offered two separate locations but refused them, and turned up at the city centre anyway. Luckily, there was a counter demonstration there to combat some of the misconceptions that these organisations have. However, I wonder whether you have had any discussions with the police, because we really need to understand if they want to come into our areas, what happens. I support the council leader in Swansea, who made the decisions that he made. However, what can be done when those decisions are undermined by such groups?
Thank you for that. Although I am refreshed, I am not actually a Deputy Minister at this point.
Oh, I am sorry.
That is okay. As far as I know. [Laughter.] However, you do raise a very serious point—[Interruption.]
I need to refresh my memory.
You do raise a very serious point, and there is no doubt about the negative and damaging actions that follow as a result of far-right hate crime, and, indeed, that is one aspect of the revised hate crime framework that I will be launching next week. I already have a meeting arranged with the deputy chief constable of South Wales Police, who leads on this matter. That will be held very soon to see how the police can better engage in these issues.
Y Llywydd / The Presiding Officer
I call on the Welsh Liberal Democrat spokesperson, Peter Black.
Thank you, Presiding Officer. Minister, can you tell me what work the Welsh Government is doing in respect of hate crime and of improving race relations?
As I have mentioned, I will be launching the hate crime framework next week. That should be a very well-attended event at the Millennium Stadium. We are working with the Wales race forum and the faith forum and the Gypsy and Traveller groups, so we are not leaving any stone unturned in terms of our work with various minority groups.
Thank you for that answer, Minister. Are you aware of the disquiet among the racial equality councils in Wales at the fact that they did not win the award on tackling hate crime, which was, instead, awarded to Victim Support, which has no record of working in the fields of race, disability or sexual orientation, so much so, that I understand that they have withdrawn from the Wales race forum meeting, because they consider that your Government’s record on race relations is very poor?
I am not aware that they have withdrawn from the forum. This is a matter that I will pursue with them, but I have not had any complaints from any organisations about the way in which the consultation on the hate crime framework has been carried out.
7. Will the Minister make a statement on childcare provision in rural communities? OAQ(4)0163(CTP)
Improving the quality of, and access to, childcare is at the heart of our early years and childcare plan. Under the plan, we made commitments, working with economy, science and transport, to pilot initiatives to support and develop the childcare market. In taking these forward, we will ensure that rural childcare is specifically included.
Deputy Minister, the Wales Rural Observatory report into rural services identified that communities with populations of under 1,000 residents have no local nursery provision, and that has a damaging social and economic impact. In addition, a recent Family and Childcare Trust report indicated that not a single council in Wales said that there was adequate provision of rural childcare services. You do have legal means available to you in order to ensure that local councils make that provision available. Given the importance of childcare, particularly for women who need good childcare in order to access work, will you give a commitment to use those legal powers at your disposal to ensure that those services are provided?
We have set out a clear direction of travel in our early years and childcare plan. We want to see a greater amount of childcare available. We want to see greater flexibility in that childcare and, crucially, we need to raise the quality of childcare as well. That is work that is ongoing between me and the Minister for Education and Skills. As we develop and carry that forward, I am very much aware of the need to improve the amount and availability of childcare in rural communities as well as in urban communities. It is very much part of our thinking and part of what we will be doing as a Government. As I have further details to give to you, rather than making up an answer for you now, I will certainly bring those back to the Chamber. I am happy to be examined on them as we develop our policy response.
Thank you very much, Deputy Minister, for that answer, but may I ask when parents in Brecon and Radnorshire will actually see any change on the ground as a result of those discussions that you are having at the moment? The lack of affordable childcare, or, indeed, any childcare at all is a huge issue, specifically for women in rural areas. While I am sure they would be reassured that you are talking about it, what they would very much welcome is actual childcare places that they can afford in their communities.
As I said, we recognise that there is a need to stimulate the childcare market in a range of parts around Wales. We will do that, and we will specifically ensure that we do that in the pilots that we run in parts of rural Wales, as well as in parts of our urban communities. The point around affordability is an area where we will clearly have a parting of ways, because part of what makes childcare affordable is the help that is provided to parents in the tax and benefits system. Changes that have been made since 2011 make childcare more expensive for working parents across the country. We will do what we can and what we should to try to stimulate the childcare market to have better childcare available in more parts of Wales. That is our commitment, and we will stick to it.
8. What action is the Minister taking to tackle poverty in Clwyd West? OAQ(4)0161(CTP)
There are a range of measures to help tackle poverty in Clwyd West undertaken by the Welsh Government and our partners. For example, there is a significant Flying Start footprint across the north Wales coast of the constituency of Clwyd West. The Member will be aware of the good work that Communities First has done over a number of years in his constituency. I had the privilege of visiting Kinmel Bay to see at first hand some of the work in transforming that particular community.
I thank the Deputy Minister for that answer, and I would concur with him about the excellent work that has been undertaken by Communities First in Kinmel Bay and elsewhere in my constituency. However, will you congratulate faith-based organisations, such as churches, which offer money and debt advice services across my constituency, particularly the Antioch money advice centre, which is based in Capel Salem in Colwyn Bay? It has been operating for a number of years now, and it has provided free unconditional advice and support to people in need. What are you doing as a Welsh Government to expand opportunities for churches and faith groups to offer and extend more of those services in the future?
We have a regular engagement with church and other faith groups within our portfolio. For example, the Minister has met with the Archbishop of Wales about the role of churches in helping with financial inclusion projects. I am happy to recognise the role that church groups, other faith-based groups and the wider voluntary sector play in helping to deliver on this agenda of tackling poverty. The point is that a number of people go to these groups for help in need. Our job is to help them, and at the same time to tackle the causes of that need and understand why people are in such desperate times.
Tackling Poverty Action Plan
9. What progress has been made in implementing the Welsh Government’s Tackling Poverty Action Plan? OAQ(4)0169(CTP)
Thank you for the question. All departments within the Welsh Government are contributing towards the objectives in the action plan. There has been positive progress in a number of areas, including, for example, the Lift programme that was recently launched, and the fact that the affordable homes target has been increased from 7,500 to 10,000 homes. I will be publishing more details of progress in July as part of the first annual report. This Government remains committed to taking action to tackle poverty.
Our Government remains committed, as you say, to tackling poverty, and a number of initiatives have taken and are taking place to aid disadvantaged communities. Improving the educational attainment of children from low-income families is one of the aims, and I welcomed the announcement that the Flying Start programme was being extended. Deputy Minister, these initiatives, though, have been introduced at a time of squeezed budgets and welfare reform. What assessment has been made of the impact that the Westminster Government’s benefit cuts are having on our most vulnerable citizens?
It is a point well made. The Welsh Government has published its own research on the cumulative impact of tax and benefit change. You do not need to just take our word for it; the Institute of Fiscal Studies’ research has also highlighted that the bottom 20% of the income group will face the biggest reduction as a direct result of tax and benefit changes introduced by the UK Government. The three groups hardest hit are families with children, the disabled and those on the very lowest branch of the income tree. We recognise that that is the reality of the position. That is why, even in these toughest of times, we are committed to the anti-poverty agenda. We are committed to having more money going into Flying Start to roll that out, and it is a commitment that goes right across this Government, in direct contrast to the direction of the UK Government.
In the ‘Building Resilient Communities’ document published last year, your colleague the Minister committed to undertaking a study to improve our understanding of the issues around housing and fuel poverty in rural areas, and what might be done to reduce fuel poverty in these areas. How has the Government progressed with that specific commitment?
That will be happening this year.
The action plan promotes credit unions as a way of people on low incomes being able to get affordable loans as well as to encourage saving. One Cardiff resident has approached me about what happened to him when he was turned down for a Wonga loan. He was refused with a text message, which said, ‘We can’t help you, but we have friends who can’. This then followed with his details being spread about to every other pay-day lender that it could get its hands on. Within a week, he had had 350 calls, 750 e-mails, and 1,200 texts. I am extremely concerned, first about the sharing of his details without his permission, but also about the way in which these pay-day lenders are collaborating together to target vulnerable people who may be tempted to take on loans that they simply cannot afford. I wonder what can be done by this Government to ensure that this is not happening.
This is a matter that we have taken up directly with representatives from the pay-day loan industry. The Minister made it very clear that he disapproved of not only their practices, but the way in which they approach the most vulnerable people with this type of repeated, persistent attempt to drive people further into debt. It is a matter of real concern. We have already called on the UK Government to do something about it in the new arrangements for the industry. We would like to see a cap on credit come sooner rather than later, but it is also the practice of people who are trying to entice people into loan debt. If you provide us with the details, the Minister and I will happily take it up once again with the UK Government.
The Impact of the Bedroom Tax
10. What assessment has the Minister made of the impact of the bedroom tax on vulnerable families and individuals in Wales? OAQ(4)0171(CTP)
I thank the Member for that question. We published our latest assessment on the impact of the UK Government’s welfare reforms in Wales in April. This is at both a Wales and local authority level and includes the impact of the bedroom tax. We have also considered the impact of the reforms on vulnerable groups, such as disabled people.
Thank you for that response, Minister. Is it not true that women, in particular, are facing the impact of this unfortunate tax and penalty because it does affect one-parent families, in particular, and as women tend to be the majority of social housing tenants? Whatever you call this tax, it is a penalty for poverty; it is a penalty for wanting to bring up a family and put children through school; and it is a penalty for being vulnerable without being able to compete in the market. Since it is a full 12 months since the introduction of this tax, what more could this Government do to protect those people who are suffering as a result of it?
Thank you very much for that question. You are quite right that women, particularly single parents, are affected disproportionately, but also, particularly, disabled adults and children. The Department for Work and Pensions, in fact, estimates that around two thirds of those affected by this reform are expected to be disabled. So, the impact on some of the most vulnerable people is very clear.
In terms of the second part of your question about what we can do, first of all let us make this very clear: the only meaningful way to deal with the bedroom tax is to abolish it. I am very pleased that my party throughout the UK has pledged to do that if elected at the next general election. However, in terms of more immediate action for the Welsh Government, we did indeed make available, up to last March, an additional £1.3 million for discretionary housing payment purposes in Wales, which is not normally a devolved matter, of course; £20 million additional funding in 2013 to support the building of one and two-bedroomed affordable homes by registered social landlords; and a further investment of £20 million over the next two financial years. Indeed, £0.75 million has been provided in 2013 and 2014 to support the work of local authorities and their partners to mitigate some of the worst effects and, of course, the investment that they were making in advice services and credit unions.
Given the statement in last week’s Westminster Hall debate on housing benefit changes in Wales by the Minister for Pensions, Steve Webb, only three local authorities—Cardiff, Conwy and Caerphilly—out of the 22 had bid for the additional £20 million top-up fund announced by the UK Government to support tenants, particularly the most vulnerable tenants, affected by the changes. Will you establish, or endeavour to work with colleagues to establish, why the other 19 local authorities had not endeavoured to draw down that additional money?
I will discuss that willingly with my colleague the Minister for local government, but the financial pressures on local authorities and the way in which they have to prioritise are very strong indeed. However, none of that detracts from the really unfortunate and divisive nature of the bedroom tax.
11. Will the Minister outline his policies for strengthening community cohesion in South Wales West? OAQ(4)0167(CTP)
I thank the Member for that question. I will be renewing our commitment with the publication of our delivery plan for community cohesion next month. To deliver the plan, I have already announced funding for regional community cohesion co-ordinators, including in the western bay and mid-west regions.
Thank you very much for that answer, Minister. Your delivery plan has seven key outcomes for community cohesion that came into effect last month, I think. I agree with the outcomes; it would be very hard not to. I was particularly interested where you say:
‘Increased awareness and data collection to established trends in immigration and plan appropriate training for staff.’
Could you outline what specific data the Government is collecting and when they will be available for public consumption?
I will need to write to the Member with the precise details on that. In general terms, however, what I can say is that we collect data on, for example, refugees and asylum seekers who get allocated to Wales, so that public services can allocate their services appropriately. However, I will write you with further details.
Minister, given the interest that you have shown in restricting the pay-day lender sector, I wonder what discussions you have had with the local councils in my area with regard to extending the no-cold-calling zones. Obviously, many older people are vulnerable to this activity, and we want to make sure that these zones are extended within the capacity of the powers that we have in Wales.
Thank you very much, and I applaud the work of Swansea council in this regard, in terms of the action that it is taking with the high-cost lenders. These are matters that I will discuss further with my colleague the Minister for local government, to see what further action we can take and how we can cascade good practice.
12. Will the Minister provide an update on Welsh Government action to support food banks in Wales? OAQ(4)0174(CTP)
We recognise that it is important to do what we can to help to tackle the underlying causes that force people in desperation to seek help from food banks. The Welsh Government will continue to encourage food banks to engage with other services, for example, Communities First, the wider third sector, and statutory services.
There are three food banks in Llanelli, and I know that you have visited one of them, but I have heard that there are plans by WRAP and other agencies for supermarkets to provide the food that would otherwise be wasted to the food banks in order to meet the growth in the demand for the services of food banks. What consideration have you given to this?
Thank you for the supplementary question. I can confirm that the Welsh Government is working with the Waste and Resource Action Programme—WRAP—to try to ensure that we do more to tackle food waste and surplus food. The industry working group was set up and it actually published guiding principles for surplus food distribution in March of this year—there were case studies on the WRAP website. We fund that particular group to help to draw that together, and we will also provide £1 million in the coming year for FareShare Cymru, which acts as a main distributor of that surplus food from supermarkets, with much of it going to organisations such as the Trussell Trust, which is the main co-ordinator of food banks in Wales. So, we are very clear: we do not want to see food wasted; we want to see it used. We want to see food banks make good use of that and help to support people who really are, in desperate times, facing food poverty in modern-day Wales.
I had the pleasure of meeting the admirable Trussell Trust last week—the trust told me that food banks are an expression of something that has been going on in the churches for ever, namely feeding the hungry, that food poverty has been with us for ever, and it asked that we all work together, putting aside whatever party political differences we may have, to focus on those in need. They told me that they will be putting this message to all parties and all agents. I pledged my support, and I urge you to do the same.
I hope to meet the Trussell Trust formally over the coming months to discuss the work it does and to understand the scale of the problem that we face here in Wales and across the rest of the UK. It is undeniable that more and more people are going to food banks for help in desperation. The unfortunate criticism that some elected representatives made of people who go to food banks is not something this Welsh Government will get involved in. We will not blame people facing food poverty for their plight, but we do have to have an honest engagement and understanding as to why people are in food poverty, and do something about it. That is where we must part ways. There is a very clear difference in view about the action taken, especially the tax and benefit reforms introduced by the UK Government. I said earlier in response to questions today that the lowest 20% of income groups in this country will be the hardest hit by those reforms. It is no surprise that that is linked directly to more people seeking help from food banks.
13. What action will the Minister take to improve gender equality in Wales in 2014? OAQ(4)0159(CTP)
I thank the Member for that question. We are delivering on the commitments in our programme for government and the objectives in our strategic equality plan, including actions to support women into employment and to increase the number of women in public life.
Thank you for that reply, Minister. The Equality and Human Rights Commission recently claimed that almost no progress has been made in getting women into positions of power and influence in Wales over the last 10 years. What a shame. It points out that there are fewer women on top here since 2004. What action—[Interruption.] In 2004, there were more women at the top. What action does the Minister intend to take to ensure that women are better represented in Welsh corridors of power?
Well, you raise a number of points there. Let me make one thing clear. We have taken firm action in terms of communicating with the chairs of public bodies to impress upon them the importance of making sure that women from all walks of life, especially some of the most disadvantaged women, are able to come forward to take up public appointment posts. We will be reviewing the progress at the end of next month, and I will be holding a meeting for chairs of public bodies in November where we can look at what action has been taken, what has worked, and what has not. However, may I say this? This Assembly has an excellent record in terms of gender representation, and, in terms of the Welsh Government, I have made the point before, in reply to another questioner, that, for example, every member of my private office staff is female, as are most of my senior officials.
14. What is the Welsh Government doing to promote membership of credit unions in Wales? OAQ(4)0168(CTP)
I thank the Member for that question. Earlier this year I awarded funding for a national credit union marketing and advertising campaign, which is being led by North Wales Credit Union. This campaign was launched on 14 April and is working both on a national and local basis to further attract new members.
Thank you for that. The New Economics Foundation recently published a paper highlighting the international success of credit unions and the case for an expanded sector in the UK. Co-operative ownership, superior customer service and greater financial stability were cited to support the case. Minister, you recently announced additional funding for Welsh credit unions to enable more vulnerable people to get help, and intimated that credit unions will eventually need to be sustainable as independent financial institutions. How will you monitor how the moneys given are used to achieve your aims and assure continuing growth in membership and a strategic approach for the future development of credit unions here in Wales?
I thank the Member very much for that question. Yes, I agree that, overall, our aim is to support credit unions to achieve 6% market penetration by 2020, with a target of 143,000 members of credit unions in Wales by that date. There has clearly been a pattern of increased membership and we are very pleased with that. In terms of monitoring the effectiveness of our spend, my officials will be meeting with those credit unions receiving that money on a regular basis to check that it is indeed having the desired effect. There will also be, as part of the north Wales programme, a dedicated phone line and webpage, and we will be able to monitor the number of hits on that.
Minister, I am sure that you would agree with me on the scope of the work that North Wales Credit Union is doing. As a result of the funding, it has launched tv and radio advertising and bus and large-format posters with the aim of being able to attract more members. Additionally, on top of this, what other initiatives are you coming forward with to increase awareness of just how good credit unions are? It is not just for vulnerable people, but for people across all backgrounds.
I thank the Member very much for those points. I have, and I trust that everybody has, seen the advert for credit union membership that is being initiated by North Wales Credit Union. It is a very good advert. I congratulate it on it. In terms of additional work, I have been in touch with all Ministers, for example, to encourage all the staff they are responsible for, including local authority and NHS staff, to work towards payroll deductions so that they become members of credit unions and therefore increase the financial resource base. Betsi Cadwaladr health board, for example, has already led the way on this, and I am very pleased with that. I have done my bit by being a member of two credit unions. I would encourage every Assembly Member to make sure that they and their staff are members also and set a good example.
Minister, it may be your misfortune to have your marketing campaign for credit unions overshadowed and outclassed by the UKIP campaign. However, in terms of that marketing campaign, may I ask what targets you have set for it in terms of increased membership of credit unions? How are you monitoring whether that target is being met and how is it being associated with the spend on the marketing campaign?
Thank you very much. I am not responsible, refreshed or otherwise, for the UKIP campaign, I am pleased to say. In these very tough times, we value the work of credit unions and the role they can play in terms of supporting financially excluded people. That also means attracting new members who are relatively more affluent, shall we say, and perhaps offering them loans so that they can replay those amounts and therefore increase the credit unions’ income.
In terms of the details of how we are monitoring the spend, I think I have already answered that in relation to questions from Sandy Mewies, and there is nothing further that I can add.
Y Llywydd / The Presiding Officer
I call on Jenny Rathbone to ask question 15. She is not present.
Question 15, OAQ(4)0172(CTP), not asked.
Y Llywydd / The Presiding Officer
Thank you very much, Minister.
The following amendments have been selected: amendments 1 and 2 in the name of Elin Jones, and amendment 3 in the name of Aled Roberts.
Y Llywydd / The Presiding Officer
I call on William Graham to move the motion.
Motion NDM5497 Paul Davies
To propose that the National Assembly for Wales:
1. Notes that the number of small businesses with a rateable value of up to £12,000 in Wales now stands at 73% of all businesses;
2. Recognises that the Welsh Government will have full responsibility for business rates once the Wales Bill has been given Royal Assent;
3. Acknowledges that a balance between third sector and independent retailers is essential to sustain our high streets;
4. Calls on the Welsh Government to:
a) Consider the benefits of splitting the Welsh multiplier into small and large businesses to bring Wales into line with Scotland and England;
b) Reinvigorate hardship relief, a vital lifeline for small businesses.
I move the motion.
The United Kingdom Government announced last year that the Welsh Government is going to be given full power over non-domestic business rates. The Welsh Conservatives welcomed this positive announcement and have urged the Welsh Government to address the burden of business rates and allow the economy to expand. The devolution of business rates is therefore supported by both the Welsh Government and the Welsh Conservatives.
This power being devolved to the Welsh Government will ensure that it is held to account for the economy. The devolution of business rates is a challenge to the Welsh Government to start using its newly upgraded toolbox to promote economic growth and create jobs. Undoubtedly, we know that the private sector in Wales is far too small, as the First Minister has remarked. Offering comprehensive small business rate relief is an ideal way to stimulate enterprise births, rejuvenate local economies and give existing small businesses an opportunity to grow and prosper.
The last revaluation of business rates in Wales was in 2010 and on its website the Welsh Government has highlighted how this process does not raise extra revenue. The Welsh Conservatives have, however, highlighted how a number of businesses up and down the country have suffered as a direct consequence of this revaluation, in particular rural businesses and tourist-related businesses. Given that a number of firms in Wales have already suffered due to a costly revaluation, it further shows the need for effective business rate relief. Indeed, in Torfaen, the council has written off more than £700,000 in business rates and in the last three financial years 250 businesses in the constituency have had their debts written off by the council. Effective business rate relief provision must, therefore, be the way forward.
The Chancellor of the Exchequer announced in his autumn statement of 2013 that there would be a 2% cap on the rise in business rates for the next financial year for businesses in England. Assembly Members voted the next week to follow the Chancellor’s lead in capping business rate rises at 2% following the Non-Domestic Rating (Multiplier) (Wales) Order 2014. Business rates are set to rise in line with the rate of inflation at more than 3%.
The Federation of Small Businesses in Wales has called on the Welsh Government to reform the rating system as soon as possible to help businesses on Welsh high streets. The Conservative-led coalition in Westminster took a bold lead in capping rate rises at 2% and it is right that the Welsh Government should not put Welsh businesses at a competitive disadvantage.
We need to remember the importance of small and medium-sized enterprises to the Welsh economy. Small and medium-sized enterprises account for 99% of the Welsh business stock, and they provide employment for well over half of the private sector workforce. SMEs are the lifeblood of the Welsh economy, and require adequate support from the Welsh Government.
Given that there is a desperate need in Wales to grow the private sector, Welsh Conservatives believe that the current levels of rate relief available are not adequate enough. Business rate relief is one of the strongest tools at the Welsh Labour Government’s disposal to get the economy in Wales moving. With Wales’s overreliance on the public sector, Labour Ministers should be doing more to utilise this tool to encourage wealth creation, reduce unemployment and increase social mobility.
The Welsh Government has extended the small business rate relief scheme in Wales until March 2015, and it claims that it has successfully pressed the UK Government to extend the small business rate relief scheme in Wales. However, we say that it is merely following the UK Government’s lead. The Welsh Conservatives have maintained a long-standing belief that the current levels of small business rate relief are not adequate, and have pledged to abolish business rates for all businesses with a rateable value of under £12,000 and provide tapered relief for small businesses with a rateable value of up to £15,000.
This policy would allow much-needed capital for small businesses to hire new staff, perhaps expand their premises, or explore new markets. We estimate that our policy would result in a reduction in the amount of business rates. It is important to remember that the benefits would outweigh the costs, particularly when one considers the reduction in unemployment. If the Welsh Government listened to our proposals, the private sector would grow, unemployment would be diminished and Wales would become generally more prosperous.
Despite billions being spent on economic development in Wales and the nation having received two rounds of European funding, and noting my question last week regarding the third round of funding, the private sector in Wales is still far too small. For 2010, there were 39 enterprise births in Wales per 10,000 of the population. This is the lowest of any of the United Kingdom nations, with a figure as high as 61 for every 10,000 of the population in England.
Small business owners in Wales face increasing overheads and heat and lighting costs, and also the threat of personal prosecution if they fail to pay their business rates; it is hardly an incentive for anyone to endeavour to start their own enterprise. Indeed, a failure to promote the enterprise zones created means that they have not attracted enough new businesses and investment, and a Welsh Government survey of businesses in enterprise zones published last month describes 66% as having been located in their enterprise zones for over 10 years and 50% as having been trading for over 20 years; 30% were not aware that they were in an enterprise zone, 50% were unaware of business rates support and 80% did not know about the support available for Superfast Cymru.
Failures include Finance Wales offering higher rates of interest on borrowing than it needs to under European Union state aid guidelines. Its latest annual review is too focused on generating profits rather than assisting businesses and developing the Welsh economy, creating a false vision of regeneration.
Figures published by Eurostat show that Wales has the lowest gross domestic product per capita of all UK nations, and, after a decade of Labour Governments in the Assembly, Wales remains the poorest part of the United Kingdom and Welsh GDP per capita is consistently well below the EU average. A recent task and finish group recommended
‘a system that restores the link between economic growth and the revenue received from business rates’.
It stated that, although local authorities carry out a lot of work with their businesses in encouraging economic growth, a system such as this would be an added incentive.
Previously, the Welsh Government has said that this would depend on whether or not business rates are devolved to Wales. Now that we know that the Wales Bill will devolve business rates to the Welsh Government, it is crucial that the Minister for economy states whether the Welsh Government will be seeking to introduce this measure.
Helping small businesses survive and expand, and making the option to become an entrepreneur a more realistic and achievable goal for people, is critical to Wales’s economic recovery; this needs action now. The Welsh Conservatives’ proposal of more generous rate relief would help increase the rate of business start-ups in Wales, while helping existing businesses to thrive. Both I and the Federation of Small Businesses have continued to say that, if every SME in Wales could employ one additional member of staff, then every person in Wales who wanted a job would have one.
Abraham Lincoln remarked:
‘You cannot escape the responsibility of tomorrow by evading it today.’
Y Llywydd / The Presiding Officer
I have selected the three amendments to the motion. I call on Rhun ap Iorwerth to move amendments 1 and 2, tabled in the name of Elin Jones.
In point 4a) delete all after ʻlarge businesses’.
Add as new sub-point at end of point 4:
Extend the small business rate relief scheme to cover all businesses with a rateable value of £15,000 or less.
I move amendments 1 and 2.
Thank you very much, Presiding Officer, and I thank the Conservatives very much for tabling this motion; I am pleased to have an opportunity to respond and to move the amendments in the name of Elin Jones.
Of all the issues that business owners in my constituency raise with me, I certainly think that business rates are raised the most. That is, of course, for very good reason, because the level of rates that a business pays can truly make a difference to the viability of the business, and its ability to grow and to employ more workers. That is why we, for years, have encouraged action, and have taken steps to try to change the system in Wales, so that it is a system that works for the benefit of our businesses. Creating such a scheme was part of the Plaid Cymru manifesto back in the 2007 election, and we were determined that it should be part of the One Wales Government agreement, and it was that Government that introduced the rates relief scheme for small businesses.
It is now clear that more help is needed by businesses, and, at last, after years of campaigning by Plaid Cymru, the UK Government has decided to devolve business rates fully to Wales, as is the case in Scotland and Northern Ireland already. We will, therefore, have an opportunity to make more fundamental changes to the system, which truly needs to be reformed.
In General, Plaid Cymru would certainly agree with the Conservatives’ motion, and we are pleased that they have now adopted Plaid Cymru policies. Our amendments make minor but important changes, I think, to the motion. The first amendment reflects the complexity of the different situation in different parts of the UK. In Scotland, there are three multipliers, of course—not two as there is in England, and as Plaid Cymru wants to see in Wales. The third multiplier in Scotland is for businesses with a rateable value of more than £300,000, and for those that sell tobacco and alcohol. In England, yes, there are two multipliers, as we want to see here, but their definitions of what counts as a small business and a large business differs from what Plaid Cymru wants to see. If we adopted the system as it is in England, businesses with a rateable value of more than £18,000 would fall into the second multiplier, and would therefore be at a disadvantage compared with businesses in Scotland. So, obviously, that would not benefit businesses in Wales.
Therefore, Plaid Cymru wants to see two multiplier—one for businesses with a rateable value of up to £35,000, and the second for businesses over that threshold. A Plaid Cymru Government would also impose the higher multiplier value at a lower level than the multiplier in Scotland, in order to keep control of the edge that large businesses have in Wales, because those businesses, of course, formulate an important part of our economy too.
Even in that situation, introducing the second multiplier would raise more than enough money to pay for a significant reduction in the lower multiplier to assist small businesses in particular. A Plaid Cymru Government would also extend the business rates relief scheme, which was introduced by the One Wales Government, as amendment 2 proposes. Extending the scheme to all businesses with a rateable value of up to £15,000 or less would assist more than 83,000 businesses in Wales, we estimate. Our policy is to offer 100% relief to all businesses with a rateable value of £10,000 or less, which would mean that more than 70,000 businesses in Wales would pay no business rates at all.
Y Llywydd / The Presiding Officer
Will you take an intervention from Andrew R.T. Davies?
I am grateful to the Member for taking the intervention. I am very pleased to hear that Plaid Cymru has changed its position, because, when in Government, it steadfastly refused to listen to any requests from this side of the Chamber to bring in the proposals that we are debating here today. So, it is good to see that the new spokesman has changed that policy. However, do you not regret that, when in Government, you did not change the policy to take more businesses out of business rates?
You know full well that it was Plaid Cymru, when in Government, that did introduce the rate relief scheme, and it is our intention now, when in Government again, to extend it, to include some 80,000 businesses in Wales or more.
The introduction of the two changes that I have mentioned today, taken together, would cost about £30 million, but that would help tens of thousands of businesses, and could lead to enhanced profits, more jobs and possibly higher wages for workers. We are regularly talking, are we not, about the need for better jobs in Wales?
Improving the economy is Plaid Cymru’s priority, and therefore the cost is worth paying. I encourage everyone to support Plaid Cymru in our efforts to help the business sector in Wales.
Y Llywydd / The Presiding Officer
I call on Eluned Parrott to move amendment 3, tabled in the name of Aled Roberts.
Add as new sub-point at end of point 4:
Explore ways to make business rates more responsive to changing market conditions, to ensure that rateable values are more reflective of current valuations.
I move amendment 3.
I would like to thank the Welsh Conservatives on bringing the debate today. I would also like to congratulate Plaid Cymru on single-handedly achieving business rate devolution for Wales. I had thought that it was something to do with the Silk commission but I am grateful for your instructions. The subject of business rates is, of course, among the most pressing of issues for all small businesses. Certainly, it is the one that is raised most often with me in my region. In particular, it is difficult because it is that inflexible fixed cost that is very difficult to manage when other costs are, perhaps, easier to contain in difficult economic times. We also know that business rates hit small firms disproportionately because they often take up a larger proportion of turnover than they do for larger businesses and present particular challenges for certain business sectors, for example, small independent retail businesses and tourism businesses, which often have very high rateable values by comparison with their turnovers.
We have agreed many times in the past in the Chamber on the need for reform, but the difficulty is, of course, finding a balance that has a positive impact on those businesses that are struggling with the current regime without them having an unacceptable impact on other businesses instead. We have discussed radical reforms, such as moving towards a profit or a turnover-based regime. However, clearly, we have to be mindful of the difficulties in collecting that because for big businesses in particular moving money can be very easy; however, for all businesses moving property is not. As more powers over business rates are then devolved, we have the opportunity to discuss these more radical options with a new sense of purpose that, perhaps, we did not have before. However, I would say that even now we have some powers that we can use, and that have been used, to help support Welsh businesses.
In our amendment today I want to recognise that there are what I would call significant issues with the revaluation regime. I want to explore ways to make the system more responsive to changing market conditions. The Enterprise and Business Committee in our inquiry into town centre regeneration some time ago now took evidence from traders in places like Narberth, some of whom had seen their business rates double or treble at the most recent revaluation. These huge, sudden step changes in business rates proved completely impossible to accommodate within a reasonable business plan and caused some really significant difficulties to those who had been involved. What worries me even more is that, in some of those cases, that huge rise in rateable value had been exacerbated because they had invested in their business to make it more competitive. I am concerned that we are financially punishing entrepreneurs for a behaviour that we really need to encourage, namely making an investment into the economy and creating jobs and wealth, but what incentive is there to do that if you are then going to be taxed more as a result?
At the other end of the scale we have the situation in Newport, which has seen a catastrophic market failure in its town centre properties since the last valuation, with large increases in vacancy rates and a massive fall in footfall and, as a result, big drops in property prices, too. This means that in Newport some businesses are now paying more in rates than rents, which is completely unsustainable. However, the next revaluation is still some years away. I fear for high streets like the one in Newport in terms of their ability to survive what are now artificially very high business rates. I think that we need to look at ways in which we can make the business rates regime more responsive, to knock the sharp edges off the rises that successful locations see and offer quicker relief to those locations that are, frankly, in crisis.
I recognise that the revaluation process is extremely complex and expensive to undertake. I do not think that we would want to suggest full revaluations more frequently than they currently take place, however I believe that we must look for ways to make business rates follow the markets more closely in-between revaluations. There are data that local authorities collect that can help us to do that.
You have persuaded me with amendment 1 in terms of the need for removing that wording although not necessarily in terms of the policy content behind it. I will be supporting Plaid Cymru’s amendment 1 today but not amendment 2. With regard to amendment 2, while I applaud the intention to support Wales’s small businesses, I think that this particular measure would be a bit of a blunt instrument that does not really reflect the complex nature of the business make-up in Wales. A business property with a rateable value of £15,000 may be a struggling town centre retailer or a thriving internet retailer in a cheap industrial unit with very, very different abilities to pay. I think that there is a more fundamental problem here with the valuation regime that this does not really address. Unless there are any Welsh businesses in premises that are valued at less than £15,000, this would throw a much bigger burden of payment on to those valued at more than £15,000. Many of the independent retailers in my region have a rateable value higher than that. I would suggest that we need to look more closely at local discretion, at differences between different business sectors and think again about this, because it just is not the panacea that people seem to think it is.
I welcome the opportunity to contribute to this debate. Business rates have been a long-term issue for the Welsh Conservatives. As I said in my intervention to the Plaid Cymru spokesperson, I can remember many debates in the Chamber when his party was in Government, almost imploring the then leader to take on board our policy of bringing forward the rate relief scheme that would have offered such opportunities to businesses here in Wales, and the defence that the then leader offered back as to why he would not do it—
This is a very short intervention: does the Member accept that his party has not long been calling for the devolution of business rates, which puts us in this position now where we are going to be able to take some positive decisions on business rates in Wales?
I find it remarkable, but I understand from its point of view, why Plaid Cymru wants to try to claim credit. It was the Conservative-led coalition that set up the Silk review, which has led to the devolution of business rates, and, ultimately, at the end of the day, the Conservatives have been at the front, not at the back of this argument. However, I appreciate that he is new to his position and obviously he is not familiar with the historical precedence that his party once took on this.
It is important to reflect, and I would like to spend the time that I have available to me reflecting on the importance of our high streets in particular in this equation. The Welsh Conservatives launched the regeneration policy that was brought forward some 18 months ago on high street regeneration, and at the heart of that was our business rates proposal that would, ultimately, give an instant kick-start to many businesses seeking either to upgrade their premises or seeking to create more employment on our high street. As we have gone around Wales, and in particular in Barry where we launched this policy, that was the one point that many of the businesses on that high street said would give them the breathing space to allow them to compete either with the out-of-town retailers or, indeed, the internet retailers that so proliferate the shopping market at the moment—Amazon et cetera.
What we have to remember is that when we are talking about business rates, and especially small business rates, we could be talking about helping in excess of 70% of the small businesses in Wales if our policy was adopted, and with the tapering relief for those with a value of up to £15,000, that would bring another 5% of the businesses in Wales into that relief, which would make such a big difference on our high streets. We do not believe for one minute that we can nostalgically go back to the 1950s or 1960s concept of the average shopper going day in, day out to do their daily shop on the high street. People have changed their habits, but as our document clearly highlighted, we talked in the round about what we could be doing in terms of bringing high street managers in, having a 24-hour culture on our high streets, reforming the planning system, and, as I have said, above all, having business rates at the heart of what we are talking about in allowing businesses the opportunity and the space to develop their operations.
I was very pleased, in the short time that I was Chair of the Business and Enterprise Committee, to get the review into business rates and high street regeneration in particular up and running, and that review was obviously accepted by the Government. There is still much work to be done around that. I know that the Government took the recommendations on board, but I would be interested, when the Minister replies today, to understand exactly how the Government is progressing with some of those recommendations. It is regrettable in regeneration terms—I see that the Minister is in his place—that the Government has not come forward with the complete strategy on high street regeneration that was promised some 12 months ago by his predecessor. We still await that. Again, I appreciate that it is not in the portfolio of the Minister who will respond to this debate, but she may be in a position to say what discussions she has had with the Minister for Housing and Regeneration about the measures that the Government will be bringing forward.
As the lead member for the Liberal Democrats touched upon, with the advent of responsibility for business rates arriving here in the Assembly, it is an opportune time to reflect on what type of measures the Government or the opposition parties might wish to put forward in their manifestos for 2016, because time and again, whether it is the Federation of Small Businesses, the chambers of trade or a small business on its own, this is the issue that they say would make the biggest difference to their balance sheet. In fairness, they are not getting something for nothing because those rates do go to pay for services, but they do not feel as if they can tangibly feel what those business rates are buying them. It is such a big and uncontrollable cost, as has been touched on earlier. With revaluation, for example, all of a sudden you could have spent the money upgrading your premises and your offering and then be penalised for doing that as an entrepreneur. It seems perverse and there will be huge discussions on this. So, there is much to focus on here. The Government could make an instant win by adopting our policy. I do not believe that we are going to have that eureka moment today, but I will be grateful to understand the journey that the Minister is undertaking.
Today has offered the Welsh Conservatives the opportunity again to reinforce its long-standing commitment to supporting the business community the length and breadth of Wales. I hope that Members will find support in the motion and vote for the motion on the agenda this afternoon.
Thank you for the opportunity to contribute to the debate today. It is not often that I support what the Conservatives want to do, but I do support small businesses.
The formulation of policies is one thing, but their implementation is another. When you walk down Llanelli high street, there will be a mixture of shops and differences compared with other areas. Town centres reflect the local flavour of an area. However, similarly to the rest of Wales, the local community depends on small businesses across my constituency. The messages that come from businesses are very similar across our country.
I am happy to note the work of the Welsh Labour Government. We have many tools and we are ready to use them. Only yesterday we heard that Jobs Growth Wales had exceeded its target, and I was happy to note that. I am committed to supporting every effort to regenerate Llanelli, and I emphasise that we need to be creative in our suggestions. I see opportunities to promote tourism in Llanelli, for example. I went to the opening of Llanelly House recently, which has been regenerated with European funding. It has created the possibility of creating a community in the town centre to ensure that people can live and shop locally.
There are four Welsh Labour Government grants that I wish to highlight that can support small businesses. Recently this year, the centre of Llanelli received a grant worth £1 million under the Vibrant and Viable Places scheme. This is a grant that is targeted at poverty and town centres. My priority is to implement and support local projects that could benefit from this financial support.
Earlier this year, Llanelli received money to develop a business improvement district, to support co-operation between the local authority and local businesses. It is now looking at a large area across Llanelli before holding a ballot so that businesses can choose a project that will be created to be beneficial to businesses in the area, including small businesses. On the Open for Business scheme and, of course, the small business rate relief scheme, they are the bread and butter of our communities. The National Eisteddfod in August will be the jam—an opportunity for us to showcase our town to the whole of Wales. Thank you very much.
In March last year, the Minister’s business rates task and finish group published its anomalies report. That report said that there is little doubt that the retail sector currently has an undue rates burden in comparison with other sectors. It attributed part of that to the failure of actual property values to be reflected in rateable values. Although, I would have thought that that delay to revalue would probably have affected all sectors. So, while I can support the Liberal Democrat amendment as drafted and recognise the case made, I still think that it would be a brave Government that introduced more frequent revaluations of properties on which lending has been secured.
In Swansea, we have seen some pretty rapacious behaviour on the part of a bank lending on commercial properties, revaluing portfolios of property at a time of recession, calling in borrowing regardless of the lifetime of the loan, hatcheting businesses in the process, and then watching the value of those foreclosure properties grow during the economic recovery. So, such banks do not need the encouragement of an ongoing programme of frequent revaluation in the name of Government to introduce more uncertainty into a lending regime. That would create more vulnerability for business borrowing and, in the case of commercial landlords, their uncertainty will inevitably end up creating uncertainty for tenants. No-one trying to start or build up a business is going to thank a Government for that, retail or otherwise.
So, it is in business rate mitigation that we will find the more agile responses to changing business conditions. Rate relief or exemption and constructive use of a hardship fund may not solve the problem of the high street by itself, but it is here that the Welsh Government can find speedy flexibility to help small retail businesses when times are hard, rather than turn to inertia pending national revaluation.
I appreciate that the Welsh Government’s own business rate relief scheme will be running on, but it is hard to see—and this point was made by Rhun ap Iorwerth, too—whether there has been any real appetite to make the most of that speedy flexibility.
As we have heard, Minister, the Welsh Conservatives’ high-street strategy document is now 18 months old. You have had time to consider how, perhaps, to pilot the split multiplier described in it, if you needed a pilot. There seems to be some common ground in the Chamber now, and the Scottish evidence regarding a similar programme is there for you to see. You might also have at least committed to future testing the much longer standing call for the scrapping of the payment of rates for our smallest businesses altogether in, say, a city region, if you felt that our ideas needed testing, but you have not done that, and that will be a disappointment to the 73% of businesses in Wales that could have benefited.
These and other small businesses are among the grass-roots private sector operators that have stepped up to the plate to help to rebalance the economy by finding 1.6 million new jobs for people in the UK. Even in austerity, with cuts, the UK Government has been dextrous and brave enough to help small businesses take on new employees via tax and national insurance breaks and deregulation. The levers of tax mitigation that the Welsh Government could have used to help Welsh businesses through the tough times have not really been pulled with dexterity or bravery.
As we know, the Welsh Government will soon assume complete responsibility for raising and spending business rates. This is a chance, Minister, for you to show how much you love Welsh private enterprise by doing something better, or to at least accept that it is in the Welsh Government’s interest to look after the 90% plus of our private sector, namely the small businesses, that define our economy. Think of it as an investment to save, if you like: you can help the smallest businesses or larger businesses in areas of deprivation, where property values are lower, with stability by not charging them rates at all. You can help slightly larger businesses with stability by introducing the variable multiplier and, in times of extremis, you can help those firms via the hardship relief. You might even wish to offer guidance to local government to be proactive in offering agreed rate reductions to high-street businesses affected by disruptive roadworks, for example, rather than allowing them simply to offer an e-mail link and letting businesses get on with trying to get compensation. High-street businesses in Bridgend in this position, for example, have not even bothered to try to recover money as the process was so complicated and their council so unhelpful.
Therefore, no-one is asking you to bail out no-hopers, but viable small businesses are still vulnerable to financial shocks that large companies and the public sector can better withstand. Lose them in local disruption or one great crash, and where will Wales’s job growth come from then? Who will create the wealth to help raise all out boats, or, indeed, the money to pay back the borrowing plans you can now make thanks to the same legislation that gives you your new powers on business rates?
Today’s debate focuses on one of the most integral components requiring change in order to get the Welsh economy going and growing. Indeed, never before has there been such a need to look again, examine, and decide which to accept of the many recommendations coming forward from those most affected, to include business owners, business industry support bodies, the Welsh Government and us as Assembly Members in our attempts to support our vital private sector and our business industry in Wales. The Welsh Conservatives’ motion and amendments, tabled by Paul Davies AM, intend to do just that, and my contribution today seeks to support those aims.
When meeting many business owners in my constituency, the conversation always and ultimately reverts to concerns being raised as to just how difficult it is to pay the amounts that are due on an annual basis in business rates. It does not matter how large or small the business, how long the business has been trading, or even the line of business they are in. However, very recently, I spoke to one young man who was very pleased that he no longer pays business rates as a result of the business rate relief. He expressed much gratitude for this as it helped him to sustain and grow his business. I would like to acknowledge the work that the Minister has done in this regard in the time I have been here. However, we need to take a much braver step forward and look at other ways to deal with this particular old chestnut.
Experience teaches me that, during a new business set-up, when one takes on a leasehold or freehold retail unit, you know what your estimated outgoings will be in terms of your annual rental or business loan. You are then presented with the business rates chargeable at that time. However, as things stand, you are powerless as a business owner to exert influence over the rises in business rates that can come your way. This can be a huge burden in terms of the overall sustainability of your business. The Welsh Government setting the multiplier each year and the Valuation Office Agency assigning the rateable value can have a huge impact on someone’s business, and I welcome the cap introduced by the UK Government and replicated here. However, it is not enough. I welcome the fact that the Welsh Government will have full responsibility for business rates once the Wales Bill has received Royal Assent. However, it is not enough. I welcome the hardship relief that is available although very little known about and applied for, but it is still not enough. The current £1,000 rate rebate that the Minister announced only recently has caused some confusion within those needy businesses in my own area. They do not know whether it is automatically applied or whether they have to apply for it, and I would like some clarification on that today.
Our small and medium-sized businesses are one of our greatest assets in Wales. There are 8,300 small businesses and 2,015 medium businesses employing thousands of people across Wales. Our high streets in Wales have the highest vacancy rates in the UK, and such is the concern in the industry about this that we now have the cross-party group, which I am really proud to chair, on small shops, looking at ways to revitalise our high streets. Some support on business rates could allow businesses to employ an extra member of staff, helping to eradicate our unemployment levels in Wales. It is said that, if every business took on one, we could do away with our unemployment. Sadly, recent figures from the Centre for Retail Research forecast the disappearance of the Welsh high street within just 20 years if current closure levels remain the same. Minister, we cannot allow this to happen. The First Minister has indicated that the private sector in Wales is too small. Offering small and affordable business rates is just one way to stimulate enterprise births and, despite billions spent on European development in Wales, we have seen little or no benefit to our private sector or, indeed, our SMEs. The Confederation of British Industry says that the most important issue facing Wales is delivery. We have had a lot of talk.
On the Welsh multiplier, splitting and possibly lowering it would benefit 775 of our businesses. Raising awareness of the hardship relief and placing an obligation on local authorities to advertise this more freely, as they do with council tax relief, would benefit our businesses. It would be easy to do through the council propaganda free newspapers so often put out by local authorities. Also, following the devolution of business rates to Wales, I believe that allowing each local authority the option of retaining its collective business rates, as recommended by the task and finish group, would be another way of incentivising collaboration between our local authorities and the very businesses they are collecting this money from. These are just some of the tools in the box, Minister, that you have to turn the wheels of entrepreneurial success and growth in the Welsh economy. For the sake of our businesses in Wales, I urge you to use these and also to consider and support our motion today. Diolch. Thank you.
Y Llywydd / The Presiding Officer
I call on the Minister for the Economy, Science and Transport, Edwina Hart, to speak on behalf of the Government.
Thank you very much indeed, Presiding Officer. I very much welcome the debate today and I am very pleased to support the motion as it stands because I believe that there is a genuine dialogue across the Chamber in terms of what we want to do in respect of business rates. It is very important—and this is a point that Janet Finch Saunders made—that we use every tool we have in our toolbox to ensure that we have a fair and equitable environment so that we are able to deal with businesses. However, I will say that not all businesses will be successful, irrespective of what I do in terms of business rates relief, and it is important to get that balance to understand where we can help and assist and where we are just bailing people out when, in the long term, there is not going to be any good coming out of it for the person who is trading or in terms of what might be going on in the high street.
May I thank William Graham very much for the points he raised in his contribution? William actually understands business rates, and that was reflected in his contribution today. Business rates are not an easy area to deal with in terms of the technical issues surrounding them and the language that is used in that context. I do not necessarily agree with some of the general comments William made about enterprise zones and various other things, but I will concentrate on the issues that I think have been important in terms of the discussion of business rates today.
In terms of the amendments, we are very happy to support amendment 1 tabled in the name of Elin Jones because we think it is an important amendment that allows us to develop policy further. I will say to Rhun that the issue around the multiplier is an issue that Professor Morgan will be looking at as part of his ongoing work. However, every time we have a debate in the Chamber, Presiding Officer, the work schedule of Professor Morgan gets longer in terms of the areas and anomalies that he has to look at.
In terms of amendment 2, tabled in the name of Elin Jones, I am afraid that we have to oppose this amendment, because, like Eluned Parrott, we have some concerns about this amendment. I have asked Professor Brian Morgan to work with businesses and other stakeholders to identify their priorities for business rates and this work will help to inform how we move forward following devolution. We will be considering a small business rate relief scheme, along with examining all reliefs. Changes are likely to be very costly and we need to balance cost against benefits. I do not think that anybody in the Chamber would disagree with that final sentence in that context.
May I say that we are very supportive of amendment 3 in the name of Aled Roberts? It is important that we have a system that is right for Wales and we will use the opportunity presented to us by the devolution of business rates to ensure that that is the case. The valuation officer is responsible for the valuation process and for determining rateable values and it is not an area in which we can intervene. I have asked Professor Brian Morgan to work with business and other stakeholders to identify their priorities for business rates. This work will help to inform how we move forward.
I recognise the impact on business resulting from the postponement of revaluation, but the reasons for delaying revaluation in Wales were compelling, including the additional costs of explaining the higher rates multiplier to business. Although I do regret the UK Government’s original decision on this, I was happy that we were able to secure cross-party support to take the same decision as the UK Government and defer the issue in Wales.
We are responding to the challenges faced by business as a result of changing market conditions in other ways. Following advice from the task and finish group, we asked the Valuation Office to update its guidance on material change in circumstances, so that businesses can better understand the options available to them if things change in their areas. This has been done.
We have also addressed a number of important issues with the extension of small business rate relief and the introduction of Wales retail relief, Open for Business and new developments rate relief schemes. I have asked local authorities to target £3.5 million to local needs schemes for the businesses most negatively affected by the postponement of revaluation. However, I take the point made by Janet Finch-Saunders about the lack of understanding out there about the schemes that are available. This is something that I will certainly ask my officials to discuss with local government colleagues: what further work can we do to publicise the scheme and give out easy information? For instance, a local needs scheme is available to local authorities to support businesses that have been negatively affected by revaluation, or that contribute to their local economic development aims. Local authorities are the best place to understand these local circumstances and the challenges there, but it also has to be understood by the business community.
In terms of the new development scheme that was launched in October 2013 and runs until September 2016, this will exempt new developments from business rates between 1 October 2013 and 30 September 2016, for the first 18 months. I think that that is very important in terms of how we deliver the agenda to encourage construction and speculative development. There has been an exceptionally positive response on this from local authorities.
The Open for Business scheme was launched in October 2013 and it provides 50% relief from business rates for up to 12 months for businesses that have taken occupation of certain long-term vacant properties. I think that that helps to address some of the issues in the high street. In terms of the high street, I know that my colleague the Minister will bring forward proposals on town centres in the autumn. We have had extensive dialogue on this, because you think that you can have an easy discussion about the high street, but you cannot, because there are so many circumstances that impact on the high street, whether they are due to issues with out-of town planning, or the nature of business.
I was very much taken by the comments of the leader of the opposition that we cannot go back to the past in terms of the high street. It did cross my mind that I could see you with a Miss Marple style basket going out to do your shopping and to the post office. [Laughter.] It is true that we do have this idea that towns were so different years ago, and it is something that we see in some classic dramas on television, but was it ever thus? I think that we have to ask ourselves that question sometimes. To what do we actually perhaps need to return?
In very real terms, this is very much an ongoing debate for us and an ongoing task for Professor Brian Morgan. It is important to recognise that there is consensus here about what we need to do in the future in terms of how we need to take everything forward when we actually have devolution. I have to be ready for the mechanics of this to go forward, because, at the end of the day, it is important that we have a system that is fit for purpose in Wales.
I have also taken the opportunity to meet local authority leaders recently and have asked them to come up with some of their own priorities with regard to business rates in the future, because there is a discussion of what percentage should be given to local authorities and what percentage should be utilised elsewhere. There is a big issue in that because, obviously, authorities like Cardiff will have the benefit of large increases and will always have a lot of business rates coming in, while small authorities with fewer business rates may be disadvantaged if we change any part of the system. We also need to remember that local authorities have their own powers to issue discretionary business rate relief through hardship, and we need to recognise that they have powers there.
Therefore, I think that, in terms of the business rate discussion, the engagement has been good with the business community. The heart of our approach is to ensure that the devolution of business rates will be an important and significant step forward that will give us the necessary policy flexibility, because, at the end of the day, with all of the comments that have been made by speakers—whether they were about the beauty of Llanelly House and the wonderful site where we are going to go for the Eisteddfod from Keith to the issues that Suzy Davies raised as well—one of the remarks that I do take to heart was from Eluned Parrott, who said that we do not want to penalise entrepreneurs. That is one of the key points when we look at this. We do not want to penalise anybody through any reforms that we make to business rates. Any reform of business rates has to be for the good of business and to support small businesses, but this is going to be a very difficult balancing act, with the budgets that we currently have, to take forward. However, I hope, Presiding Officer, that I can count on the Chamber to input regularly into the work that we are undertaking.
Y Llywydd / The Presiding Officer
I call on Nick Ramsay to reply to the debate.
Thank you, Presiding Officer. That is the first time that I have ever heard Andrew R.T. Davies compared to Miss Marple. Janet Finch-Saunders, maybe, and myself, occasionally, but congratulations, Minister, on being the first in the Chamber to do that.
I am pleased to round up this debate, which has been consensual in the main, and I am wary of saying too much, in that the Minister said that she accepts the dialogue that we are having and broadly accepts the motion today. I do not want to talk ourselves out of that, so I will touch on some of the Minister’s comments later. Therefore, first, I will look at some of the comments that have been made by other speakers during the course of what was a very constructive debate. To start with, we had William Graham’s introduction, which, aside from quoting Abraham Lincoln, referred to how the UK coalition Government was quite right to cap the rate rises at 2%. That was the right decision to make to support businesses across the UK, and we were pleased that the Welsh Government also followed suit here. There is no doubt at all that businesses have been pummelled by repeated revaluations and, as I think that Abraham Lincoln said, you cannot evade responsibility today.
Unless you have been living on the moon or just do not listen to the Welsh Conservatives, you will know that we want to abolish business rates—. [Interruption.] You do not have to answer. We want to abolish business rates for businesses of up to £12,000—. [Interruption.] I would expect that from the other side of the Chamber. We want to abolish business rates for businesses with up to a £12,000 rateable value, with tapered relief then to £15,000. Indeed, Plaid Cymru, as Rhun ap Iorwerth told us, has developed a similar policy in the light of the Welsh Conservatives’ policy, although Rhun’s memory cheats him there. It is a very good policy. Imitation is the best form of flattery, and we are pleased that all parties are buying into the Welsh Conservatives’ policy there.
I am a big fan of the local retention of business rates, which some Members have mentioned. I have had discussions with the Minister about this and, indeed, with Professor Brian Morgan himself. I do appreciate that it is complicated. The reform of business rates is not going to be an easy thing to achieve, by any means. I think that if it does happen, there does have to be a compensatory mechanism so that local authorities with poorer economies are not penalised. However, at the same time, it is very important, as Professor Morgan said, that we provide the incentive to local authorities to grow the economy in their areas, and providing that retention of rates, so that they can see the effect that their policies are having on the local area and are encouraged to grow businesses, would be a really good thing.
Eluned Parrott, you made the point that some businesses, such as tourism, have a light rateable value compared with turnover—I have said that less eloquently than you—and you said that we need a better balance. We certainly do. Yes, in the Enterprise and Business Committee’s report into town centre regeneration, we touched on the importance of a better balance with business rates, although we did not go too far into that one, because we appreciated that there was a separate review going on.
I do remember the great frustration in that little room in Narberth when we went there to see how they had made Narberth the success story that it was. I think they thought we were the Welsh Government and the UK Government; they were not really clear what our role was. However, we certainly felt the frustration of many local business owners, who I think wanted us to wave a magic wand and get rid of business rates overnight, which clearly was not going to happen, but we said that we would take their arguments back.
Keith Davies spoke about the Llanelli experience, which you clearly thought was a positive one. You mentioned the Open for Business scheme, which reminded me of other local authority schemes; I think that Monmouthshire had a back to business scheme a couple of years ago. There is a good model there that the Welsh Government can look at and perhaps roll out that best practice across Wales.
Suzy Davies painted a bleaker picture of the Swansea experience. We need a better regime. You said that we need speedy flexibility, and there is no doubt that businesses rely on quick action. Many of the criticisms that we have made over the years relating to Finance Wales and other mechanisms for giving businesses access to funding are that these organisations often are not quick enough for businesses. They are quick in terms of the civil service and they are quick in terms of the way that local authorities operate, but businesses really need a very speedy response, and I liked your term ‘speedy flexibility’.
Janet Finch-Saunders spoke to a young man who no longer paid business rates and who thanked Janet for her endeavours in this area. Everyone is claiming a little bit of the cake in this regard. You also referred to the powerlessness of businesses and the significance of the business rate multiplier. The Minister said how complicated this system is, but it is vital that that business rate multiplier is altered. Although we do not accept the Plaid Cymru amendment, I see where Rhun ap Iorwerth was coming from in talking about the Scottish experience and the English experience, and the way in which we can do things with that business rate multiplier to make it a far more successful mechanism.
The Deputy Presiding Officer (David Melding) took the Chair at 16:12.
Thank you, Minister, for your comments and thank you for accepting the motion. It is very important that we have this dialogue. I think that all parties have something to contribute to this debate, and we have put forward our views on this, which we hope is the way that the Welsh Government will go. Professor Brian Morgan probably needs a commendation for the amount of work that he has put into Assembly task and finish groups over the years. When I last had a discussion with Professor Morgan, he was complaining that his groups were all task and very little finish. I think that members of the group were saying the same thing, but we appreciate the amount of work that he has put in.
So, let us continue the dialogue. Let us give businesses the support they need, because without that support and that all-important business rate relief, the economy in Wales cannot be grown. Unless we can grow the Welsh economy effectively over the months, years and decades to come for future generations, we are not going to have the sort of money coming into the coffers that we need in order to spend it on all the other things that we want to do to make Wales a little bit of a better place.
Y Dirprwy Lywydd / The Deputy Presiding Officer
The proposal is to agree the motion without amendment. Does any Member object? The motion—. I now see there is objection. You need to be quicker, really. Come on; wake up. I defer all voting on this item until voting time.
Voting deferred until voting time.
The following amendments have been selected: amendment 1 in the name of Aled Roberts, and amendment 2 in the name of Paul Davies. If amendment 1 is agreed, amendment 2 will be deselected.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call on Jocelyn Davies to move the motion.
Motion NDM5498 Elin Jones
To propose that the National Assembly for Wales:
Calls for the abolition of the bedroom tax.
I move the motion.
It has been just over a year since the introduction of the bedroom tax, or the removal of the spare room subsidy if you are a sensitive soul, a year during which we have witnessed the senseless suffering of some of the most vulnerable people in our society, thanks to a policy that seems to take an almost perverse delight in causing distress, upset and hardship. It is a year that has unambiguously demonstrated that the bedroom tax is failing to achieve its stated aims, and that its aims were misguided and poorly judged to begin with.
I have spoken in this Chamber many times about the bedroom tax, and I should not think that there is any doubt here about my views. However, I will keep speaking out until we have done all that we can to help those who have been affected, and I will keep speaking out until the bedroom tax has been abolished for good.
I will be generous. While watching the UK Government implementing this policy, it is tempting to think that it is displaying astonishing cruelty. Instead, I will give it the benefit of the doubt and assume that it has demonstrated a fundamental lack of understanding of housing in this country, and a failure to think through the consequences of its policy.
The bedroom tax was initially brought in to cut the housing benefit bill. The UK Government estimated that it would save £500 million a year. Evidence now suggests that its estimates were wildly over-optimistic. Researchers at the University of York have said that the Government overestimated the savings by at least 40%.
Any savings have almost been entirely negated by the costs that are transferred on to local authorities, housing associations, the health service and other public services. In Wales, the estimated saving to the Treasury from imposing the bedroom tax was £22.4 million, but I estimate that the Treasury could lose between £400,000 and £500,000 from the extra housing benefit caused if people affected by the bedroom tax moved into the private rented sector. Local authorities and housing associations will also spend many millions on evicting, re-housing, and re-adapting properties to meet the needs of disabled people. The only way that there are savings is if tenants stay put and cough up themselves.
This is, of course, without taking into account other costs—the costs of the stress on the families suddenly finding themselves unable to pay their rent, the stress of receiving threats of eviction through the post, the stress of being asked to move from a family home to somewhere new, and the stress of leaving behind community, family and friends. It is hard to quantify these costs, but we must take them into account. Also, where is the human dignity in proving that you are one of the deserving poor?
There has been a huge rise in demand for the discretionary housing payments to help families facing eviction and homelessness as a result of the bedroom tax. Local councils in Wales have experienced an unprecedented 250% rise in applications. This is entirely unsustainable. Discretionary housing payments were never intended to offer long-term support for those who are unable to pay their rent, and the funds available are a limited resource. To use the simile that has been used by many others, it is like a plaster to treat a gunshot wound. I am pleased that the Lib Dem side of the Government has been able to insist on increased discretionary housing payments, but let us not forget that that was funded by increasing the bedroom tax overall for the tenants who have to pay it. It is not new money.
Almost two thirds of homes affected by the bedroom tax include someone with a disability. In many cases, those extra bedrooms, which the UK Government seems to view as an unacceptable luxury, are used to store medical equipment, to accommodate carers, or are too small for bedroom use in any case. Ten per cent of homes have been adapted to suit the needs of those living in them, at great expense. I know that Lindsay Whittle will be setting out that in greater depth later.
Of course, the Government’s position is that those who find themselves unable to pay their rent should move and downsize to accommodation of an appropriate size. This demonstrates a fundamental lack of understanding of the current social housing stock. There simply are not the smaller houses available for people to move into, and in many places the waiting list for one and two-bedroomed homes is impossibly long, as demand soars.
So, there is nowhere to go. Families are forced to accept the bedroom tax, finding themselves struggling to make ends meet on their already meagre budgets, which are being chipped away. People are going without what we would consider to be essentials, and are selling their possessions just to get by. It is no wonder that 78% of landlords have seen an increase in rent arrears fuelled by the bedroom tax. By October last year, 15% of households hit by the bedroom tax had received an eviction risk letter and were in danger of losing their homes. Possession claims in the last two quarters of last year were around 28% higher than in the previous year.
Community Housing Cymru has reported a surge in empty homes, as housing associations struggle to let the larger homes. To solve the problem of under-occupancy we now have houses sitting empty. After six months, there were around 727 extra void properties in Wales. That figure clearly shows the utter failure to think through the consequences. So, we have a crisis in this country. We live in a wealthy, modern country, yet a rising number of people are having to use food banks to avoid starvation. There has been a tenfold increase in food bank use since 2010. Now, the bedroom tax treats those that are the most vulnerable with, I think, contempt. It is a failed policy.
The obvious response, of course, is, ‘It’s not our problem; it’s out of our hands and beyond our control’, but while people in Wales are suffering under this policy, it is our problem. While the costs of dealing with the consequences of the tax are passed on to local authorities, housing associations and the health service, it is our problem. So, today, I call on the Welsh Government to do what it can to mitigate the effects of the bedroom tax. I think that the Welsh Government could, particularly, be prepared to help disabled people and their families—the financial benefits there are obvious, as it would save money that would otherwise have to be spent re-adapting homes to make them suitable if people are forced to move. The Government also needs to ensure that people have access to the best independent advice services to help them to navigate the complex benefits system. As benefits come into effect, it is more important than ever that everyone is able to access the support they are entitled to, ensuring that the ‘Your Benefits are Changing’ campaign reaches all affected tenants.
The Government should put together the financial case for abolition based on the Welsh experience. It should put together a strategy to assist tenants through to successful appeals in order to get the entire housing sector supporting those efforts. It should also present the moral argument against this policy, which now seems to be a badge of honour for specific Ministers. The Government here should be leading our housing sector in coping with the bedroom tax.
These days, it is getting harder than ever to find anyone willing to speak out in favour of the bedroom tax, but we might hear one or two this afternoon. Any initial support for reducing the housing benefit bill has melted away in the face of widespread evidence that this tax is not only causing harm, but also failing to save money. Opposition to the bedroom tax is widespread, and is not limited to political radicals: Church of England bishops and Conservative councillors have added their voices to those of many campaigners up and down the country fighting for the abolition of this policy. We must add our voices to the mix and make a stand for the abolition of the bedroom tax.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I have selected the two amendments to the motion. If amendment 1 is agreed, amendment 2 will be deselected. I call on Peter Black to move amendment 1, tabled in the name of Aled Roberts.
Amendment 1— Aled Roberts
Delete all and replace with:
To propose that the National Assembly for Wales:
1. Recognises the problem of under-occupancy in social housing.
2. Recognises the work of Liberal Democrats in the UK Government in securing Discretionary Housing Payments for local authorities to help mitigate the impact of reforms in individual deserving cases.
3. Welcomes the recent announcement that the cap on the amount councils can spend on Discretionary Housing Payments will be lifted to give local authorities more flexibility.
4. Expresses concern at the barriers put in place by local councils to those seeking to apply for Discretionary Housing Payments and their failure to allocate all the resources given to them for this purpose in good time.
5. Welcomes the motion passed at the Liberal Democrat conference in September 2013 calling for an immediate evaluation of the impact of the spare room subsidy, and awaits the outcome of the independent review of the policy commissioned by the Department for Work and Pensions which is now underway.
6. Believes that the withdrawal of the spare room subsidy should be mitigated by exempting disabled adults and disabled children who require a carer and only applying it to new public sector tenancies.
I move amendment 1 in the name of Aled Roberts.
I thank Plaid Cymru for bringing this debate forward. I think that there is some common ground in the need to reform the welfare system and get to grips with the benefits system. However, making changes is not easy, and it is important that we continue to debate these issues to ensure that the savings are made as fairly as possible. We have tried to set out in our amendment how we think this should be taken forward.
Housing benefit is a huge part of the money that we spend on benefits and has grown rapidly, doubling from £11 billion to £22 billion in Labour's last 10 years of Government. It reached £24 billion per year by 2012-13, and, if unreformed, the housing benefit bill would have cost £26 billion per year by 2014-15. At more than £220 billion, the whole welfare budget represents a third of all Government spending and exceeds spending on health, education and defence combined. Changes to the welfare system have therefore been necessary to try to tackle this unsustainable welfare bill and help to reduce overcrowding and long waiting lists for housing. A quarter of a million households are living in overcrowded social housing. We subsidise 1 million spare bedrooms in the social rented sector through housing benefit. It has also been important to bring parity into the system for those who live in private rented and social housing, after Labour removed the spare room subsidy from housing benefit recipients in the private sector in 2008. I do recognise that there were differences in the way that was done, and I think that, if what is in our amendment were adopted, that would then reflect what happened in the private rented sector.
The Liberal Democrats have consistently worked hard to make sure that changes are made as fairly as possible. In 2012, we negotiated to ensure that, from 2013-14, an extra £30 million per year would be added to the discretionary housing payments fund, specifically to help with the removal of the spare room subsidy. This means that, in total, we have massively increased discretionary housing payments from £20 million in 2010-11 to £180 million in 2013-14. Additional funding was also provided for rural areas, which provided extra support for tenants in Powys, Gwynedd and Ceredigion. This allows local authorities to give extra discretionary help to those facing difficulties in meeting their housing costs.
Peter, will you take an intervention?
I am going to try to get through this. I think that there will be two voices only from this side, so I want to get through the whole thing if I can.
We have negotiated hard with our coalition partners to make a number of important changes to the spare room subsidy. Thanks to Liberal Democrats, the policy now protects people in the armed forces, foster carers and disabled children who need their own home. Yet while Liberal Democrats have been fighting for these concessions, here in the Assembly, Labour Members have simply bemoaned the impact of the spare room subsidy on tenants in their regions.
It is therefore surprising to hear the Minister of State at the Department for Work and Pensions, Steve Webb, state last week that only three of the 22 local authorities in Wales applied for extra UK Government funding to help mitigate the impact of the cuts. He said that only Cardiff, Conwy and Caerphilly had bid for a share of an additional £20 million top-up fund set aside by the Government. This should have come as no surprise to the Minister, however, because the Welsh Government’s own monitoring report showed that, halfway through the financial year, only three out of 22 local authorities have spent more than half of their annual discretionary housing payments budget. I know from my own casework that tenants are not aware of their right to apply for discretionary housing payments because they are not being properly advertised, or tenants simply do not understand the system, or are being forced to jump through hoops unnecessarily. Not only this, but the report also raises concerns that many local councils treat disability living allowance and child benefit as a form of income, an issue that I raised in a short debate a few weeks ago. The Minister did say in response to that debate that he would be contacting me to discuss that particular issue. He has not yet done so.
Out of the 22 local authorities, only Caerphilly disregarded disability living allowance when considering discretionary housing payments. The Department for Work and Pensions disregards both DLA and child benefit from means-tested benefits, and my understanding is that councils should do the same. So, I think the issue here is: why has the Welsh Government not given guidance to local authorities to prevent this restrictive use of funds that have been put in place to mitigate the impact on tenants? If the Department for Work and Pensions does not take into account DLA and child benefit, why is it that local councils are, effectively, assessing disabled tenants twice before they are able to give them that additional support?
While we welcome the opportunity to debate these issues today, we will not be supporting the motion. As outlined in my introduction, there is a clear need for welfare reform. In fact, a poll by Ipsos MORI last year revealed that 78% of respondents supported action to reduce under-occupation and overcrowding in social housing. I think that we have put forward in our amendment a clear way forward on this, and I hope that you are able to support that as a means of reforming this benefit.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call on Mark Isherwood to move amendment 2, tabled in the name of Paul Davies.
Add as new point at end of motion:
Delete all and replace with:
To propose that the National Assembly for Wales:
a) that there is a shortage of social housing across the UK, and in particular Wales, and that the removal of the spare room subsidy is a response to the consequent increases in waiting lists, overcrowding and hidden homelessness that sit alongside the issue of under occupancy in social housing;
b) that the removal of the spare room subsidy was first introduced for housing benefit recipients in the private rented sector in April 2008 by the UK Labour Government;
c) that additional UK Government funding that was made available for Discretionary Housing Payments from 2013/14 allowing local authorities to target those who need it the most;
d) the recent announcement that the cap on the amount councils can spend on Discretionary Housing Payments will be lifted to give local authorities more flexibility;
e) the failure of local authorities to allocate all the resources given to them for Discretionary Housing Payments in good time;
f) the advance guidance issued to local authorities by the DWP, which states that disabled people living in significantly adapted accommodation and those heavily reliant on a local support network should be prioritised for discretionary housing payments.
I move amendment 2.
The removal of the spare room subsidy is a response to the scandalously small number of social homes built by Labour and the consequent increases in waiting lists, overcrowding and hidden homelessness. Under the last UK Labour Government, local authority waiting lists in England nearly doubled as the number of social homes for rent was cut by 421,000. In Wales, the number of social homes for rent at devolved level was cut by 29,000 during the first three terms of Labour-led Welsh Government as the supply of new social homes was slashed by 71%. When the Labour UK Government introduced what it now calls the bedroom tax in April 2008 for housing benefit recipients in the private rented sector, it said that the
‘new system comprises a flat-rate benefit according to household size and location’.
Labour’s local housing allowance rules imposed a size criterion restricting claimants to one bedroom per specified occupier, and the DWP specifies now that the criteria introduced for housing benefit in the social rented sector are measured against the same size criteria already used in local housing allowance.
Will you give way?
Do you accept the distinction between the 2007 Act and the 2012 Act? The 2007 Act was aimed at a lot of short-term lettings within the private sector only, and abuse by landlords as being the prime factor for that. It bears no comparison whatsoever with the extension of that principle, to raise money, into the social housing sector.
I say that the impact on the housing benefit recipient is identical, whichever sector they happen to be living in. I will not listen to the Labour Party, which ignored a decade of warnings of a pending housing supply crisis in Wales, perniciously and shamefully.
Exceptions to this include older people, foster carers, overnight carers for the disabled, severely disabled children, armed forces personnel, and bereaved families. The DWP increased the discretionary housing payments, or DHP, budget, ring-fenced and paid directly to local authorities, allowing local authorities to target those needing help most. On top of the £119 million set aside to help local authorities implement the reforms, which already included an extra £130 million for discretionary housing payments, the UK Government announced an additional £35 million for the DHP budget from 2013-14, including a new £20 million DHP fund. However, we have heard that only three Welsh local authorities applied for a share of this. The Minister of State for Pensions, Steve Webb, said last week that
‘We cannot simultaneously say that there is unmet need…when those authorities did not ask us for the money to top up their DHP budget’.
The UK Government has announced that the DHP has increased by £40 million in 2014-15 and 2015-16. A new good practice guide for local authorities on administering DHPs was issued in March 2011 and was also detailed in the housing benefit and council tax benefit circular issued to every council by the DWP in July 2012. It is stated that
‘There are many reasons…why it may not be appropriate for someone with a disability to either move house or make up any shortfall in rent themselves. A good example of this may be an individual or family who rely heavily on a local support network. In circumstances such as these it may be appropriate to use the DHP fund to make up the shortfall in their rent.’
It is also stated that
‘There will be claimants affected by this measure who live in significantly adapted accommodation due to someone in the household having a disability. It will not always be practical or cost effective for these people to move to different accommodation or they may have no other option for making up the shortfall in rent.’
However, Welsh Government figures show that only nine out of 22 local authorities had spent even half of their discretionary housing payment allocations seven months into the 2013-14 financial year, despite unspent money having to go back to the Treasury at the end of the year. Three councils, including Flintshire, had not provided figures, whereas Torfaen had committed 97% and Monmouthshire 84% of their allocations. Merthyr Tydfil had only allocated 39%. Interestingly, in the previous year, Monmouthshire committed the maximum cap of 250% but Merthyr only 28%.
The Welsh Government also delayed action by only announcing investment for a small number of one and two-bedroomed properties and looking to the private rented sector to tackle homelessness months after the changes took effect. More than three years have passed since the 2011 Communities and Culture Committee report on the private rented sector, which recommended that the Welsh Government should actively seek to promote a positive public image of the private rented sector as tenure of choice in Wales. Landlords’ representatives told me that they had already built in housing benefit changes and that change needed to be managed in local authorities. However, those same landlords’ representatives are now telling me that the Welsh Government is increasing regulation rather than starting the engagement and continued partnership working needed to deliver more quality housing at affordable rents that meets social need.
The story of the bedroom tax is not one of balancing the Government’s budget, righting the economy, or any of those other spurious pretentions to assured financial competence that David Cameron and his Cabinet might claim; it is a human story. It is a myriad of often heartbreaking tales of difficult lives made worse by this unfair and unjustified attack on the poorest and most vulnerable people in our society. It is questioning people’s very right to a home.
I hear in the estates and communities in my region stories of how this tax has affected people and their daily lives. One woman was forced to measure her box room so that Neath Port Talbot Homes would not classify it as an unlived-in bedroom when you could not even get a cot in there. One man has seen his benefits reduced because the room where his two disabled sons could stay at the weekend was not reason enough to exclude it from being classified as being spare. Disgustingly, one lady has faced abuse because she was brave enough to tell her story to the local paper. That abuse is directly the fault of UK Ministers repeatedly inferring that her disability is a drain on society. Even worse, another woman in my constituency had an eviction notice sent to her when she was in a coma. Let us remember that Governments are there to deliver services, not demonise service users so that they can cut what they are giving to them and pass the savings on to their rich backers in London.
We now have the irony of a Government supporting people to buy second homes worth up to £600,000 under Help to Buy in England, while introducing financial arguments as to why it cannot subsidise rooms used by disabled people to store medical equipment or allow carers to stay or to remain with partners who cannot share a bed because of their own disability. That is how out of touch this UK Government and some Members of this Chamber are as to the realities that face people in our areas every day as a result of this bedroom tax. We are now hearing that the bedroom tax will not, in fact, save the taxpayer a penny. In fact, it will cost more, because the consequences of this action have not been thought through.
Those of us who have opposed a bedroom tax from the beginning have argued that this is further compounding the suffering of those who did nothing to create this particular economic problem that we are facing in the UK and Wales. It even creates a barrier for those who the UK Government pretends to support, because it is possible for a son or daughter who has done well in school to move to university and see their parents evicted as a result.
What lies at the heart of this policy is a blatant attempt to shift money from the poorest and most vulnerable and give it to those most likely to vote Tory at the next election. The Convention of Scottish Local Authorities estimates that it costs Scottish councils £58 million to save the Department for Work and Pensions £50 million; where is the mathematical sense in all of this?
With tenants and social landlords now increasingly banding together, there is the possibility of a poll-tax-sized revolt in the wind. However, Ministers can still end this; we appreciate that Ministers on a Welsh level cannot end it, but Ministers on a Welsh level can send a very strong signal to the UK Government that this particular policy will not be tolerated.
Today’s Plaid Cymru motion is not an attempt to create that rift that some people want to try to create between parties here that oppose the bedroom tax, but to urge you, on behalf of the tenants, to come up with some tangible alternatives and results that we can put in place so that we do not constantly say, ‘Well, sorry, we cannot do anything because we do not have the powers’. People want to be able to see that this is a political priority for the Welsh Government, so that we can tell the UK Government that this will not be tolerated.
I appreciate the statements that people like Carl Sargeant have made, but we would like to see, for example, a strong appeals strategy. To be fair to Peter Black, he has outlined some of those areas where there are discrepancies and people are not utilising discretionary housing payments. If we had a strong strategy, then that confusion potentially may not exist. I urge you to come out here today not to make a party political statement because of the EU elections, but for you, as Minister, to tell us what you will be doing to help mitigate this most dreadful tax.
I welcome Plaid Cymru’s motion today. We must keep up maximum political pressure on the bedroom tax here in Wales, as we know that it is hitting a disproportionate number of tenants in the communities that we represent.
However, the debate on the bedroom tax that really mattered took place in the House of Commons in November last year, when my party tabled a motion calling for its abolition. That was the opportunity finally to draw a line under a policy that has ultimately proved as ineffective in practice as it was completely pernicious in intention.
Indeed, there is such a wealth of evidence out there that it is difficult to know where to start—evidence like the National Housing Federation report that described predicted cost savings as highly questionable and called it an ‘ill-conceived policy’. The National Audit Office’s report exposed the Government’s figures for not including information on the costs facing councils dealing with the change. The Welsh Affairs Committee’s report underlined the most basic flaw of all when it comes to the bedroom tax—that there simply are not the one-bedroomed homes for people to move to, even if they wanted to.
Failing completely to tackle under-occupation in social housing, costing huge amounts of public money and causing tremendous pain and hardship for those it cruelly targets—that is the reality of the bedroom tax.
I am not surprised that the Tories continue to stand by this wicked policy. After all, they are as ideologically wedded to the bedroom tax as Thatcher was to the poll tax. However, I have to say that I am very disappointed by the tone and content of the amendment tabled by the Welsh Liberal Democrats today. Surely, it is just political doublespeak of the worst kind to trumpet an internal conference motion calling for a review of the bedroom tax when it is consistent support from Lib Dem Members of Parliament that has helped to deliver and then sustain this policy. When a Liberal Democrat Minister stood up in Parliament to robustly defend the bedroom tax during that crucial debate back in November. I was dismayed, frankly, to see a motion tabled by Assembly colleagues who I respect and have worked with for many years using phrases like ‘deserving cases’, as if some tenants deserve to be hit by this cruel penalty and others do not. I hope that it is just an unfortunate case of clumsy language, but no-one asks to be in this situation. If we are returning to Victorian principles of the deserving and undeserving poor, then we have taken a huge step backwards on the path to social justice that Lib Dems in the Chamber once claimed to champion.
Even point 6, which in principle I do not necessarily disagree with, surely acknowledges the inherent unfairness of penalising people who are existing and, often, long-standing tenants—people like my constituent in Pontypool, who I heard about just yesterday, who is a woman who has lived in her home for 20 years and does not want to move, as she lives next door to her daughter who comes in every day to offer support with cooking and cleaning. Since the bedroom tax was introduced, her arrears have risen only slightly, but when she contacted her housing association seeking support, they found out that she had had to take out high-interest loans and was cutting back on fuel and food to get by.
It is a sad reality that is a million miles away from the Tory amendments today, for all their talk of wanting to tackle waiting lists, overcrowding and homelessness—leaving aside the fact that they created many of these problems themselves when they introduced the right to buy and stopped councils building new homes to replace those lost to the private sector. I am really glad that Plaid Cymru is with Labour when it comes to the bedroom tax. I am pleased that, like us, they recognise the cruelty and unfairness that is at the heart of this deeply flawed and ham-fisted attempt at social engineering. However, 365 days away from a general election, voters in Wales face a stark choice: a Labour Party that wants to scrap the bedroom tax; the Tories, who would go even further down the road of dismantling the welfare state; and the Lib Dems, who will happily support them if it means clinging on to power by their fingertips. I hope that they recognise that very clear political divide and help to deliver a Labour Government in 2015 that will scrap the bedroom tax and put fairness back at the very heart of our approach to housing.
On Anglesey, one in three social housing properties has been hit by the bedroom tax. According to the most recent figures that I have received, it affects 559 tenants there. Of those, only 99 do not have rent arrears. That gives you some concept of the scale of the problem in Wales. However, what is the alternative for those people? Most of them naturally do not want to move from their homes—I am not using the word ʻhouses’, but ʻhomes’, and am choosing my words carefully, because that is exactly what they are—where they might have lived for many years. However, even for those who are willing to move, there is nowhere for them to go. There is a great shortage of homes with fewer than three bedrooms on Anglesey, as is the case elsewhere and, as a result, only five families have been relocated to smaller properties on Anglesey to date. Moving to the private sector is not a realistic option on Anglesey either. It would cost more to the taxpayer, as the local housing allowance on Anglesey for a one-bedroomed property in the private sector is £70.70, compared with an average rent of £66 for council properties with three bedrooms.
I would also like to say that the safety net of discretionary housing payments is nothing but a small plaster on a painful wound. Applications for DHP have increased by 420% since the introduction of the welfare changes, with over 60% of the applications being a direct result of the bedroom tax. The problem has put pressure on the county council as well as tenants, with the Isle of Anglesey Council having to employ a new full-time member of staff to deal with the additional workload. However, it is people—individuals and families—who are suffering the unfairness of this tax.
There are so many individual examples from my constituency that I could mention—those people who are afraid that they will lose their homes because they are behind with their rent; the constituent from Bryngwran who had to give up his £17 weekly bus pass used to seek work because that amount of funding was removed through the bedroom tax.
What about the Pantri Pobl food bank in Holyhead that states that people cannot actually cook their food packages because the bedroom tax means that they can no longer afford to pay for electricity or gas? Surely that is enough of a reason for the Government in London to rethink its policy and to realise the impact that this tax is having on individuals and, of course, a number of agencies working with them. I want to take this opportunity to pay tribute to those agencies, voluntary organisations and third sector organisations in my constituency that are working so hard to assist these people who are suffering as a result of the bedroom tax— Citizens Advice, food banks and Communities First, to name but a few.
I have mentioned plenty of reasons for the UK Government to sit up and realise the real impact of the bedroom tax—people in rent arrears fearful of evictions, people who can no longer afford to go to look for work, people who cannot afford to cook their emergency food bank parcels. This is the effect of the bedroom tax. May I respond here to Mark Isherwood’s comments on DHP and other mitigation payments available? Does the fact that so much money is needed to mitigate the cruel effects of a Government policy not give you a clue that there is something radically wrong with that policy? So, it is up to the UK Government to act, but Plaid Cymru also believes that there are actions that the Welsh Government could be taking in the short term to mitigate the impact of the bedroom tax. We want to see a no-evictions policy where every effort is made to avoid a costly and damaging eviction. There should be added investment in advice services, for which funding uncertainty is already a constant worry but which have come under added strain due to welfare changes. The Welsh Government also has the power to meet the welfare shortfall by increasing the DHP pot—the First Minister estimated this to be between £8 million and £10 million—but if not the entire shortfall, as Jocelyn Davies suggested, why not prioritise and meet the shortfall for disabled people or families with children perhaps? These are positive proposals by Plaid Cymru to mitigate the devastating effects of this policy in Wales, but I hope that we will be able to send a very strong signal here today to the UK Government that it is time that the bedroom tax was scrapped.
I think that this is one of the meanest spirited taxes that could ever have been thought up by any Government. What has happened to the concept of a home for life? What has happened to the idea that social housing is there for people for people to live in dignity and to be treated with respect? It has been said over and over today in the points that have been made that two thirds of the people affected by this tax are disabled. I think that it is very sad that the Liberal Democrats have had to fight hard for disabled children to be exempted—and for foster carers and army personnel. It just seems inconceivable that anybody could have made a policy thinking that people who were foster carers should not have an empty room to put the foster child in. It just seems absolutely inconceivable that such a policy should have been thought of. Also, of course, there is the issue of army personnel. Earlier on today in the Assembly, Christopher Caruana from Cardiff said,
‘I took a bullet in the chest while serving in Northern Ireland. Both my ankles have crumbled and so my house has a stair lift and walk-in shower. I have lived in my home with my wife for 27 years. My kids live just round the corner. Where is the justice in trying to force me out?’
A policy that ends up in that sort of situation I do not think can be defended. Many people have made an emotional investment in a house, in a street, in an area. We all have that sort of emotional investment, and to have the uncertainty that is being created by this tax is, I think, outrageous. It is a corrosive tax that undermines people’s sense of security and wellbeing. My view is that, as politicians, we should try to open up life to people and, with this sort of policy, we are shutting it down. We are causing this intense anxiety and we are undermining people’s ability to live fulfilled lives.
I just want to highlight a couple of points. First of all, it is obvious that the majority of people have not moved who are hit by the bedroom tax. I believe that it is estimated that only 6% of people have moved as a result of the benefit changes. Secondly, as others have said, there is not enough accommodation even if they wanted to move. The policy was made without any assessment at all of the housing stock. Thirdly, the tax hits women disproportionately. I am sure that other people have had the briefing from Chwarae Teg that says that more women are social housing tenants than men and many will be single parents. This, coupled with the wider welfare reforms, which impacts more negatively on women than men, is of huge concern. We also know that Wales is estimated to be disproportionately affected. According to the DWP’s own impact assessment, it is the hardest hit by the bedroom tax.
All of this destroys people’s potential to live a fulfilling life. It curtails people’s ability to do simple, enriching things, such as having their grandchildren to stay over, because their children have left home and perhaps grandchildren have been born. One of the great pleasures and fulfilling things in life is to be able to have somewhere where you can have your grandchildren to stay, and this is no being denied to some people. I think that it is inconceivable that the Government could have thought about this.
Also, of course, disabled people have been disproportionately hit by the tax. It means that they are living under the threat of less money or the huge disruption that a move would bring. Of course, in these instances, we have what I can only call the ‘lunacy’ of the state having provided funding for adaptation to cater for disability and then a different arm of the state seeking to coerce the disabled person into moving. There is a complete disregard for the important of the networks of support and of family and friends who are local to disabled people and the amount that this saves the state via social services budgets. This is happening at the same time as local social services authorities are being pressed into making cuts in service. I think that it is further evidence of the cynicism of the UK Government that it is discarding disabled people and leaving them to fend for themselves. There will be a huge issue of what happens when these rent arrears, which have already started, accumulate. What are the social housing landlords to do? What happens? Do they evict those disabled people? It is a situation that is absolutely horrendous.
In conclusion, as I said earlier, I see our role as politicians as widening people’s opportunities, such as bringing in childcare to enable families to have far more opportunities, when they have someone to look after their children, but this tax restricts people’s opportunities. It literally tries to make their lives smaller and reduces the number of choices that they have. It is nothing more than a tax on people’s potential and possibilities and I think that the Government should be ashamed of it.
Well, happy birthday indeed to the bedroom tax. There will be no birthday cards from this side or from many people in Wales. I want to focus on the impact of the so-called bedroom tax on disabled people in Wales—our most vulnerable people.
At this point, I want to thank Wales and West Housing and Community Housing Cymru for providing some important information about the finances involved, but not expressing opinions. It is easy enough for Cameron and his millionaire cronies to say that people who have what they call an extra bedroom should move in order to downsize. You try telling that to disabled people who live in adapted properties in social housing. I am from social housing myself, by the way. Over £0.5 million has been spent on adapting homes for residents in just one housing association that I know. If these residents are forced to move because they are classed as under-occupying, much of that investment will be wasted and more money will be needed to adapt other homes for those people to live in.
It is estimated that the likely cost of readapting homes for the whole of Wales will be £40 million. That is £25 million having already been spent on adaptations to existing properties and £15 million that would be needed to be spent on adaptations to the smaller homes that they are moving to, assuming, of course, that there are enough smaller homes available, which, as we all know, is highly unlikely. That is a criminal waste of money, and what is the Tory-Lib Dem answer to all of this? Well, discretionary housing payments. We have heard it mentioned here. However, even the UK Minister responsible for all of this admits that these payments are
‘not intended to cover every shortfall created by Housing Benefit reforms’,
and then goes on to say that local authorities are told in advance how many DHPs they are going to get
‘so that they can budget accordingly’.
What on earth does that mean? I will tell you what it means. It means that if there is not enough money to offset any reduction in housing benefit, you will just have to find the money from somewhere else. That is easy for cash-strapped local authorities to do.
What has been the impact so far of the Tory-Lib Dem welfare reforms on disabled people generally and on those living in adapted homes? Disabled people have suffered from the onslaught on benefits in two major areas: the coalition Government introduced means-testing for the employment and support allowance that reduces the entitlements that people have had; and, secondly, the replacement of disability allowance with personal independence payments. Add to that the performance of Atos in assessing disabled people as capable of working when they are clearly incapable of doing so, and we are left wondering what on earth this Westminster Government has got against disabled people.
When we come to the bedroom tax and its impact on disabled people, first of all, there are not enough suitably adapted homes for disabled people to downsize into. Secondly, many of those people are already in arrears with their rent and are in danger of losing their homes anyway. That, Messrs Cameron and Clegg, is the real world. Try to get into the real world, I beg you. In Wales, more than 35,000 people have been affected by the bedroom tax and around 80% of those have some form of disability.
What does Plaid Cymru want to do about the impact of welfare reforms and, in particular, the bedroom tax on the people of Wales? Quite naturally and easily, we want to abolish the bedroom tax full stop. At the very least, as far as disabled people are concerned, we want them to be exempt from having to move or suffer housing benefit cuts of up to 25% and, secondly, we want the UK Government to disregard disability-related benefits, such as the disability living allowance, as income in assessing the income of disabled residents living in social housing. Finally, of course, we want a clear majority of Members in this Senedd to support our proposals and, by doing so, to give a clear message to local authorities and housing associations in Wales that we want to free them from having to put into practice a welfare reform that they do not support. I worked for 25 years in social housing, and, let me tell you, those people care about their tenants. Happy birthday, bedroom tax—there will be no birthday party or presents, just literally abject misery. Happy birthday indeed.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call the Minister for Housing and Regeneration, Carl Sargeant.
Thank you, Deputy Presiding Officer. I welcome the opportunity today to reiterate our position on the bedroom tax that has brought unnecessary hardship to around 40,000 households in Wales, as well as creating significant problems for landlords. May I say very clearly, as the Members on the Plaid Cymru benches have been saying today, we call, as a Labour administration and Government here in Wales, for the abolition of the bedroom tax? It is very plain; it is very simple.
Housing benefit is non-devolved. We cannot control the policy; we are just left to pick up the pieces. The bedroom tax was intended to incentivise tenants to move to ‘more suitably sized’ accommodation but, clearly, there just are not enough one and two-bedroomed properties to meet the demand. It was also intended to free up larger properties, but housing associations, again, report that these properties are becoming increasingly unaffordable, which is increasing their voids. It was intended to create improved work incentives for working-age claimants, but the only incentive that I can see is fear—fear for families of losing their homes.
The bedroom tax has cost the Welsh social rented sector £23 million in 2013-14. Discretionary housing payment increases are welcome, but these are increases from a very low base—only £7 million in 2013-14. The quart in a pint pot scenario springs to mind. This discretionary payment fund is the UK Government’s half-baked response to financial problems caused by the bedroom tax. It is nowhere near enough money to deal with the issue.
There has also been a campaign by opposition parties, based on questionable mid-year statistics, to rubbish local authorities for the way they have administered their allocations. Let me tell you that 21 out of the 22 Welsh local authorities spent 100% of their allocation last year, and the other authority spent 98% of its allocation. Do not tell me that we are not delivering through local authorities. This Chamber should be praising the work of local authorities across Wales and of many others who are doing great work to cope with the impacts of welfare reform. Local authorities are able to top up the discretionary housing payments by two and a half times the amount allocated by the DWP. However, this is referred to in both amendments as the cap, but councils cannot afford to top up the payments to this level.
So, how are tenants coping? Many Members today have told us how. They are not—plain and simple. In November 2013, Community Housing Cymru reported that housing association rent arrears had increased by £1 million due to the bedroom tax alone. This figure was expected to rise to £2 million by April 2014. The Trussell Trust reports that nearly 1 million emergency food parcels were handed out in 2013—a staggering 163% increase—with a third going to children. The DWP responded by saying that there is no robust evidence that welfare reforms are linked to an increase in the use of food banks. ‘Rubbish’, I say.
I would now like to address the amendments to the motion. I am astonished by the Liberal Democrats’ contribution this afternoon. Peter Black, his party’s spokesperson for social justice, has clearly lost the way in terms of social justice in representing his party. They are the party propping up the Conservatives in the UK Government in the introduction of this bedroom tax. I will take no lessons from them saying that they did this or did that to protect certain groups. They are part of the big plan by the UK Government to have a big effect on Welsh and UK residents, as many Members have alluded to today.
The UK Government has offered to transfer the power to set the cap on discretionary housing payment to Scotland. If Scotland accepts this offer, it will have the flexibility to pass on more funding from its block grant to local authorities. That does not apply to Wales.
I listened very carefully to the contribution made by Jocelyn Davies, asking what we can do, rather than political point scoring of saying, ‘We just don’t want this’. I have been in lots of correspondence with Lord Freud. Only recently, I wrote to him around the issue of disabled claimants with regard to housing allowance. We asked the UK Government for a fund to support additional guidance for people to understand exactly what this non-devolved bedroom tax means, and how people can be supported. Unfortunately, Lord Freud refused to offer any more support in that process.
I would like to address Paul Davies’s amendment very briefly. I will be opposing it today. The cap is not being changed in Wales. The size criteria rules in the private rented sector are fundamentally different to the ones in the bedroom tax, and there is no compulsion within the revised guidance for local authorities to prioritise disabled tenants. It is shameful, as Lindsay Whittle said, that disabled people are not exempt from the bedroom tax, particularly when they are living in specially adapted properties. Wales and West Housing Association estimates that applying the bedroom tax in these cases will cost the public purse around £40 million: that is, £25 million that has already been spent on adaptations and £15 million to adapt new, smaller properties.
As one of the Ministers on the task and finish group, we have written to Lord Freud seeking an exemption for disabled tenants living in significantly adapted accommodation. The response we got was predictably scathing. He rejected again our request to exempt disabled tenants. First, Lord Freud, in his letter, corrected our terminology; he said to us, ‘Please don’t refer to it as the bedroom tax, as it is not a tax’. There is something that he seems to have forgotten as he used that phrase in the House of Commons recently, when he referred to it as ‘the bedroom tax’. However, he does not like us calling it that. Secondly, he advised that it was too complicated to ensure exemptions for people living in properties with significant adaptations, and that discretionary housing payments should be used in these cases.
To conclude, in Wales we are doing our best to help with our partners, such as CHC and other organisations, to mitigate the impact of the bedroom tax and other welfare reforms. We have set up a task and finish group to work with the housing sector. It recently reported on 16 recommendations, many of which we have acted upon. We have provided an additional £1.3 million to further top up discretionary housing payments. We have made £20 million available to support the building of one and two-bedroomed new affordable homes. We are investing a further £20 million over the next two financial years for smaller properties.
Julie Morgan alluded to the very fact that only 6% of people have actually moved on to smaller accommodation when the DWP’s target was indeed 25%. Finally, I believe that it is only a matter of time before the whole policy comes crashing down around the UK Government’s feet. This is a decision made by the Conservatives, propped up by the Liberal Democrats, which they show no shame about. It is absolutely shameful.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call on Jocelyn Davies to respond to the debate.
It has been an interesting debate, and I am delighted, obviously, to respond to it. First, the amendments were incredibly lengthy for the very briefest of motions. I am sorry; I cannot support them. The Lib Dem amendment was almost acceptable, and I welcome much of what is in it; however, I object to describing people as ‘deserving cases’. The Tory amendment is, of course, less palatable and repeats the mistake that Labour introduced the bedroom tax in the private sector. You continue to confuse it with the local housing allowance. If you prefer, of course, to pretend that it was not introduced by Thatcher as a rent control measure on deregulation in the 1980s, that is up to you, but you are wrong. Incidentally, you also promised, in opposition, to abolish that local housing allowance if you won the elections. Of course, the world is still waiting.
I thought that Peter Black made a thoughtful contribution and I agree with much of it, but I cannot see somehow the Lib Dems rushing back into Government with a party that insists on maintaining this policy.
In terms of Mark Isherwood’s contribution, I am not sure as to why you would punish tenants now for what you say were previous Governments’ failures. That is hardly fair. If the private sector felt that this policy was a runner, I think that it would be building one and two-bedroomed properties right now to fill a massive market gap. However, it is not. Why is it not? It is because that it does not believe that it will last long. The existence, by the way, of discretionary housing payments does not justify this policy, and your reliance on it demonstrates that the policy itself is flawed.
Bethan gave us a flavour of what this policy actually means to families in practice, and I congratulate her on her efforts to support people in her region. She also reminded us of the UK Government support for those wanting to buy homes, without any size restriction, up to the value of £600,000.
Lynne, this debate does matter. It is very depressing if your message is to say, ‘Just wait until we take over at Westminster again’. People cannot wait. They cannot wait that year. They need help now. This Government, of course, can help to deliver assistance now. I know that there was a Labour motion in November, but do not forget that there was a Plaid Cymru motion in February last year, but it is better late than never to come to the party.
Rhun outlined the impact on his constituency, and the statistics that he shared with us were a stark reminder of the few choices that people have. It reminded us that people have that choice of going without food and heat, perhaps, to pay their rent. Some, he told us, could not afford to cook the food that they were being given in their food bank parcel.
Julie reminded us of the importance of dignity and respect in housing, the importance of housing to fulfilling lives and making communities, and the disproportionate effect on women and the normal functioning of families.
Minister, I am very pleased that the Welsh Government would like to see the bedroom tax abolished, and I am pleased to see you prepared to defend the local authorities’ spend of the discretionary housing payment. That £2 million arrears owed to housing associations by now, of course, could no doubt be better spent borrowing to build more. I hope that the Minister will give some thought to what he can do to lead the sector on this. Do not waste any more time writing to Lord Freud. He is not listening. Labour must, by now, regret appointing him in the beginning.
Lindsay made an excellent case for the exemption of disabled people and properties that have had adaptations made to them, and that would make perfectly good sense. You would have to ask yourself why that is not the case right now. To add to that, I saw an article in the 'Western Mail' on the weekend in which Councillor Paul James highlighted the fact that the UK Government likes to give the impression that forces personnel are exempt, but it is actually restricted to those who are involved in military operations. Being posted away from home or abroad is not sufficient; maybe they do not hit that 'deserving' button.
So, just to finish, this Government must lead the way on championing the mitigation of this policy, tenants’ benefits and their rights, access to discretionary housing payments and, most of all, appeals. Build and present the moral and financial case, including exempting disabled people and adapted properties, against this policy, Minister; if you do, we will be right beside you.
Y Dirprwy Lywydd / The Deputy Presiding Officer
The question is that the motion without amendment be agreed. Does any Member object? There is objection, therefore, voting on this item will be deferred until voting time.
Voting deferred until voting time.
The following amendments have been selected: amendments 1, 8 and 9 in the name of Paul Davies, amendments 2, 3, 4, 6 and 7 in the name of Elin Jones, and amendment 5 in the name of Lesley Griffiths. If amendment 1 is agreed, amendment 2 will be deselected.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call on William Powell to move the motion.
Motion NDM5499 Aled Roberts
To propose that the National Assembly for Wales:
1. Notes the publication of the Welsh Liberal Democrat report ʻPowering Wales’ Future’.
2. Regrets that politically conservative parties across the UK are increasingly denying the overwhelming evidence which substantiates climate change.
3. Recognises that a sustainable low carbon future can be achieved through an ambitious change in how we generate energy.
4. Acknowledges that a smart and diverse grid network is essential for ensuring that our future energy needs can be met in a reliable and sustainable manner.
5. Calls on the Welsh Government to:
a) review Technical Advice Note 8 to permit updates which reflect technological improvements and the development of new Strategic Search Areas, to encourage new projects and reduce existing concentrations;
b) work with industry to develop regional community benefit schemes, so that communities along transportation and grid corridors can benefit from the economic investments which come with renewables;
c) maximise the economic benefits of renewables by working with developers and educational institutions to expand supply chains and centres of excellence for the next generation of engineers and apprentices;
d) explore the development of Marine Energy Hubs to provide a safe environment to manufacture and test emergent marine technologies to help Wales gain a competitive advantage;
e) focus public support for research into large scale electrical storage technology such as batteries;
f) explore the potential of developing new pumped storage facilities so that more energy can be stored for peak time usage and ensure a stable supply of low carbon electricity; and
g) develop new technical advice for hydraulic fracturing, including test drilling, to ensure that safety and environmental protection can be guaranteed to the highest standards.
I move the motion.
It gives me great pleasure to open this important debate today and to move the motion tabled in the name of Aled Roberts. How we generate our power is perhaps one of the most important questions that any country can ask itself. It underpins all aspects of our society, and it is one of the single largest factors upon which our economy depends. The undeniable threats posed by climate change mean that every nation on earth is now asking itself what the future holds for electrical generation.
It is clear to us that Wales has the potential to lead the way in fostering a green revolution and by removing all carbon dioxide emissions from our generation grid. Doing so, however, is anything but an easy process. That is why I have taken a lead within my party to look at the way in which, decades ahead, we can do this and investigate medium-term options to look at how Wales could generate all of our electrical power by the middle of the century. I believe that in doing so, there will be a high degree of common ground across this Chamber, and I hope that today's debate will also foster a rational discussion about Wales's future energy provision.
I think that we all realise the opportunities that the green sector represents in terms of jobs, investment and training, and these are points that, with your indulgence, Dirprwy Lywydd, my colleague Eluned Parrott will be developing. More than this, we realise that we owe it to future generations to provide an environment and an economy that are prosperous and sustainable. Renewable energy technologies provide both in abundance, and it is a sector that we must pursue with relish.
I am encouraged by much of what the Government has said in papers such as ‘Energy Wales: A Low Carbon Transition’ over the years, and I am pleased to see that the First Minister again confirmed his commitment to the sector in his speech to the RenewableUK Cymru conference just last Thursday. If we are going to take these words further, we need to be delivering real options on the ground. It is some of these options that we have put in our motion for debate this afternoon.
In my time on the Environment and Sustainability Committee, it has become increasingly clear that many of these options will include our marine environment. Regrettably, however, it has also become clear that we are thus far unprepared to take full advantage of them, with the Wales marine spatial plan yet to be completed. As Members in this Chamber will be aware, the waters around Wales are some of the most attractive to wave and tidal technology developers anywhere in the world. The tidal range of the Severn and the Bristol channel makes them ideal for experimental lagoon and barrage development. The shallow beds of the north are perfect for offshore wind foundations, and the rough waves and rapid currents of the west are excellent for submerged turbines and floating wave devices. In recent years, we have seen developers bring forward concepts for every one of these areas, and I am pleased to see progress being made in each area. One point that is continually made to me by developers, especially those who produce wave and tidal stream devices, is how beneficial it would be to make use of marine energy hubs, sometimes termed demonstrator zones, so that concerns around the environment can be satisfied in advance of deployment, thereby expediting large-scale development. This idea has been taken forward in the last 12 months by the Crown estate, and this is to be welcomed. It has conducted a leasing round across the UK in a bid to encourage and accelerate technological development. To quote its head of offshore wind:
‘The emerging wave and tidal industry has already taken great strides, but we want to encourage faster progress in technology development and rapid cost reduction by introducing managed demonstration zones. We are offering a key opportunity to other organisations to lend tangible support in their local areas.’
We do not yet know the results of the now-completed leasing round. However, it would seem abundantly sensible for the Welsh Government to take advantage of such opportunities as outlined in its marine renewable infrastructure study. Such advances are already being explored in rival areas of the UK, such as Cornwall, where its planned hub has already been filled by prospective developers. This is also the case in Scotland.
We on this side of the Chamber firmly believe that Wales should be doing the same in order to attract international developers and to bolster the domestic supply chain. However, in doing so we also recognise that development must not be allowed without the proper environmental tests and due diligence. While this is often time-consuming, it is nonetheless essential, and I am sure that the Minister will welcome the opportunity of this debate to confirm that, in his attempts to break down the barriers to marine renewables, no breaking will be done at the cost of environmental scrutiny and appropriate habitat mitigation.
Before ending this introduction I want briefly to touch upon the Plaid Cymru and Conservative amendments to point 2 of our motion. I do so now in order that the political point-scoring can be quickly dispensed with, and so that the appropriate spokespeople can make their response. We will not be supporting either of the amendments to point 2. Regarding the Conservative wording, we feel that it does not reflect the firm Liberal Democrat belief that those who do question the rationale behind changes in our global climate are quite often flying in the face of direct scientific evidence and that there is no longer a debate to be had on these points, as was aired just yesterday in this Chamber. The scientific evidence supporting man-made climate change is overwhelming and now is not the time to pander to the flat-earthers who remain.
Instead, now is the time for us to act and to respond to the threats that climate change poses to us all. Regarding the Plaid Cymru amendment, we regret that Plaid Cymru has sought to broaden the remit of the amendment to apparently include Liberal Democrats, but to exclude those outside the UK Government. Ed Davey, the Secretary of State for Energy and Climate Change, is a firm supporter, and has said that the evidence is ‘irrefutable’ and that
‘human activity is significantly contributing to the warming of our planet.’
Nick Clegg has also said:
‘If there was ever a time to sharpen our focus on our green commitments, it’s now.’
He has also been vehement in opposing Tory voices calling for the scrapping of so-called green taxes. While there may well be a growing number of voices within the UK Government casting doubt on the reality of climate change, these voices do not come from the Liberal Democrat benches. That much is clear.
We also regret the fact that Plaid has in effect removed other politically conservative parties from our original motion. I am greatly concerned by many of the things that UKIP candidates up and down this country are advancing. There is a real danger to our country in the message that they are peddling. Their energy policy says:
‘The slight warming in the last hundred years is entirely consistent with well-established, long-term, natural climate cycles’.
They have pledged to ban the teaching of climate change in schools, and their leader in Scotland, Lord Monckton, has even gone so far as to compare climate scientists with Nazis. I am therefore disappointed that Plaid has sought to let UKIP off the hook for its outrageous climate change denial. However, these matters aside, I hope that we can have a full and broadly consensual debate this afternoon that can take these issues forward.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I have selected the nine amendments to the motion. If amendment 1 is agreed, amendment 2 will be deselected. I call on Russell George to move amendments 1, 8 and 9, tabled in the name of Paul Davies.
Delete point 2 and replace with ʻNotes that there are people across all aspects of society who will continue to question the rationale behind changes in our global climate’.
Add as new point at end of motion:
Believes that the Welsh Government must support and invest in a variety of renewable energy forms to achieve key climate change objectives and notes that there are enough onshore wind farm applications in the planning pipeline to fulfil UK renewable energy targets.
Add as new point at end of motion:
Believes the Planning Bill should give local communities more power to accept or reject particular renewable energy schemes to best fit their locality.
I move the Welsh Conservative amendments 1, 8 and 9 in the name of Paul Davies.
I would like to thank the Lib Dems for bringing forward this debate and their policy paper today, ‘Powering Wales’ Future’. I think it is important that, beyond Government scrutiny, opposition parties contribute positively to public policy debate and explore and offer policy alternatives that go beyond what they lay out in their election manifestos. The Welsh Conservatives have been extremely proactive in doing that, working positively with groups and individuals across sectors to build consensus on initiatives that will bring significant benefits to Wales and its people.
Developing a consensual approach on tackling climate change is absolutely crucial because it affects the entire population of this planet. There is much I can agree with in your paper. I hope that the consensus that has existed in this Chamber can be further developed. That is why I was not wholly disappointed, or surprised, by the Minister’s comments yesterday during the coastal flooding review statement. I think that he should perhaps stop adding to the climate crisis himself with his own hot emissions and get on with delivering what the Welsh Government has committed to do.
Before Bill Powell started talking to some of the amendments, I agreed with every word he said. I am, of course, disappointed that he, other Members in this Chamber, and the Lib Dems have joined the Minister on the platform of division with regard to the amendments. I would say to Members, if you want to go down the American route, where climate politics have become very divisive, you can do that, but you will do it without these benches.
I am not standing here today as an apologist for anyone. I believe that man-made climate change is one of the most serious threats that this country and the world faces. Left unchecked it will have far-reaching consequences for our society. That is the view of the Welsh Conservatives and that is the view of the Prime Minister. That said, if you think that I am going to stand here and put down what a minority of people who are not convinced by some elements of climate science say, as others have done, you can think again. I do believe that comments made from some quarters, suggesting that deniers of a man-made impact on climate change are like holocaust deniers, are disgraceful comments to make.
There are eminent scientists across a range of fields, such as astronomy, astrophysics and geology, who challenge most of the man-made elements underpinning current climate science thinking because they feel that there are stronger natural elements to climate change than human carbon release. Science exists to be challenged. Are we so arrogant as to stand here today and say they are wrong?
David Rees and Aled Roberts rose—
I will give way to David Rees first.
Thank you for taking the intervention. You say that science is there to be challenged, but 235 experts in the recent Intergovernmental Panel on Climate Change conference analysed the evidence and came up with the fact that it is there—there is climate change and it is man-made. They are scientists and there are a large number of them.
I am happy to take another intervention.
Y Dirprwy Lywydd / The Deputy Presiding Officer
No, you cannot. You must reply to that intervention and you will not have time to take another.
I do not disagree, David, with your comments. The point I was making is simply that we cannot be so arrogant as to say that all other scientists who have a different view are entirely wrong in their approach. You know what my views are and the view of my party.
I do need to talk to our amendments. In relation to amendment 8, I think it is pretty self-explanatory. We have always believed in a balanced mix of renewables to reduce carbon emissions and secure our long-term energy needs. I think we also need to recognise that current UK planning data show that we are on schedule to meet our EU renewable electricity targets for the end of the decade, even if we call a halt to consenting further onshore windfarms. I think that it is right that my party is looking to remove public subsidy for onshore wind, because, as they Minister cites with regard to agricultural payments, I do not think that it is realistic that the industry should receive public money on an ongoing basis.
Finally, on amendment 9, this is something that we have continued to call for, as we would like to see many of the powers conveyed in the Localism Act 2011 in England placed on the statute book in Wales, not just deregulating powers, but allowing communities enhanced rights to determine what they want to develop in their own localities.
Y Dirprwy Lywydd / The Deputy Presiding Officer
Conclude with that, please.
Thank you, Deputy Presiding Officer.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call on Alun Ffred Jones to move amendments 2, 3, 4, 6 and 7, tabled in the name of Elin Jones.
In point 2, delete ʻpolitically conservative parties across the UK are’ and replace with ʻthe UK Government is’.
Insert as new point 3 and renumber accordingly:
Regrets the restrictions placed on the competence of the National Assembly for Wales in the field of energy.
Insert as new sub-point 5b) and renumber accordingly:
explore the potential of establishing a publicly-owned, not-for-distributable-profit, arm’s length energy company.
Add as new sub-point at end of point 5:
fund a nation-wide retrofitting scheme to cut energy consumption and lower energy bills for consumers.
Add as new sub-point at end of point 5:
publish any research into the feasibility of building a grid connection between the north and south of Wales.
I move amendments 2, 3, 4, 6 and 7.
I am pleased to take part in this debate today, and the fact that we have tabled many amendments show that we take this debate seriously.
Climate change has been pushed to the outer reaches of political debate in recent years, for obvious reasons, and that has been a huge mistake. The warnings of scientists are frightening—and they should be frightening—to the whole world. Recent reports, as we heard earlier, underline the evidence that has been presented over a decade and more now. We have to respond, and we have to move away from our dependence on fossil fuels.
Although I appreciate the spirit of the Liberal Democrats’ motion, and agree with much—the majority, indeed—of what Bill Powell said, the party has to accept its responsibility as part of the coalition in London. However, I do agree completely with Bill Powell’s comments on UKIP’s blind and stupid stance on climate change—a very dangerous stance if it were to be successful in future elections.
May I refer to some of the amendments that we have tabled? The first amendment, amendment 2 in the name of Elin Jones, corrects the disingenuous sentence that suggests that the Liberal Democrats do not have a role to play in the UK Government. The motion today tries to suggest that there is a great difference between the Liberal Democrats and what is happening in the Government. It is a coalition Government, and I know that that can be difficult and uncomfortable for those in it, but you have to accept the responsibilities that come with that. It is not a Conservative Government in Westminster, but a coalition Government, and that Government has turned its back, in many respects, on the very important subject of reducing our dependence on fossil fuels. However, I will not pursue that further.
Our second amendment, amendment 3, refers to the fact that we do not have control over this industry in Wales. We very often complain about the Westminster Government—about what it is doing in terms of energy policy—and, indeed, the motion today complains about the UK Government’s stance on renewable energy. Of course, if energy were fully devolved, without any meaningless limit such as 50 MW, then we would not have to complain at all. Plaid Cymru is completely clear on this—the people of Wales own our country’s natural resources, not the Westminster Government and not private companies. The people of Wales should benefit from those natural resources, and the Welsh Government should be creating energy policy, not the Westminster Government.
The Labour Party here often says that it is in favour devolving energy in full, apart from nuclear—for some reason, we are not able to deal with nuclear. Indeed, the Labour Party has voted here in favour of devolving those responsibilities. However, it is another matter completely when Labour Party members in Westminster come to vote—they are not supportive. You have to speak with one voice if you are to be taken seriously.
Amendment 4 asks the Government to look at the possibility of establishing a national energy company for Wales. Once again, we are trying to underline the need for the people of Wales to benefit directly from our resources. Such a company would be able to generate and sell energy directly to customers in Wales and, possibly, outside of Wales, and keep any profit either to invest in energy infrastructure or to subside the bills of customers in Wales. We do have a model in Wales, of course, Glas Cymru, which is for water, and we could do that for energy as well in the future.
Another way to reduce energy bills, of course, would be to use less energy in the first place, and this is what amendment 6 refers to. The Government’s schemes, Arbed and Nest, are two successful examples from this Government and we congratulate the Government on those. However, the Government should build on this success and expand these schemes. Certainly, the state of some of the old housing stock—and this is true in west Wales, north Wales and south Wales—means that it desperately needs to be retrofitted, and it is very important that we have a programme to deal with that.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call on the Minister for Natural Resources and Food to move amendment 5, tabled in the name of Lesley Griffiths.
Amendment 5—Lesley Griffiths
I move amendment 5.
I would like to focus this afternoon on the benefits that Wales can gain from the low-carbon economy. However, before I do that, as my party’s spokesperson on science, I want to respond to some of the comments made by Russell George this afternoon. Russell, science works on balancing evidence and understanding the proportionality of the evidence that is presented to you. If you have 99 pieces of evidence that the world is round and one piece of evidence that the world is flat, it is not balanced or scientific to give both viewpoints equal weight. Science does not support flat-earthers nor does science support climate change deniers. The balance of the evidence is absolutely clear that climate change is a real thing. Vanishing fossil fuels is a real thing. These are real challenges that we as a society and an economy will have to face up to and will have to take seriously.
Returning to the idea of climate change deniers, I am aware that some commentators believe that bringing forward more environmental policies will hurt our economic growth. Obviously, as our economy spokesperson, I need to respond to that. For example, Nigel Lawson has claimed this month that anti-climate change policies are
‘inflicting increasing damage on the British economy, to no useful purpose whatever.’
I absolutely refute that. Not only, as I said, do we need to respond to the fact that we will need to provide for the future of the economy a stable and reliable energy infrastructure, but I also would suggest that the renewable and low-carbon industries offer huge potential advantages for Wales. We have significant environmental resources and enormous potential for wind, wave and solar power here. In fact, the valuing our environment study for Wales calculated that the environment in Wales provides £6 billion to the Welsh economy, one in six Welsh jobs, £821 million in tourism spending, and 15% of goods and services produced in Wales. We really must protect that very important resource. Some 41,000 people are currently employed in the renewable, low carbon and environmental industries in Wales. Those are jobs that we should be supporting and celebrating. However, we are by some measures falling behind some of the other nations in the UK, such as England and Scotland, in terms of our percentage share of this cake, and we cannot afford to lag behind.
We need to ensure that the soft infrastructure is in place to allow growth in the low-carbon economy and the creation of the necessary hard infrastructure that then follows. In particular, we need to ensure the availability of apprenticeships and other training opportunities to deliver the science, technology, engineering and mathematics skills that our economy needs, and we need to ensure that they are properly prepared for. In particular, I want to see more young people going into things like electrical engineering courses, to help to design and build the sustainable grid and other infrastructure that we will need, because it is a seriously underrepresented discipline at the moment. Skills gaps in these areas will act as a real barrier to developing the low-carbon economy in Wales.
I believe that we need to work with potential developers and education and training providers to develop centres of excellence for the next generation of engineers and apprentices, because, of course, we have the most wonderful access to natural resources, and that is a very important commercial advantage. The UK Government has established a renewables training network, with 2,000 places on training courses specifically tailored to those wanting to make the move into the renewable energy sector. We must target funding at apprenticeships in appropriate sectors, such as the renewable and low-carbon industries, to ensure that those skills are being delivered to meet the needs of a new, greener Wales. We believe that there is a real role as well for public investment in research and development to focus on technological innovations that can overcome some of the practical issues and reduce the environmental impacts of tidal and wave power, for example. We would like to see a collaborative industry-stakeholder-Government partnership developed to monitor the impact of marine renewables on the environment, so that we can be sure that these technologies are taken forward in the most appropriate ways.
I also believe that we need to support research into things such as battery storage technologies so that we can create that low-carbon grid, make it more flexible to demand and ensure that all generation technologies can be fully utilised, which of course will give us greater energy security and stability, not only for consumers but for businesses and, hopefully, lower bills for both.
Finally, I briefly want to mention fracking. Hydraulic fracturing is often touted for its economic benefits, but I think that we have to balance those very carefully against strong environmental and health concerns, and that is why we have called for new technical advice. I believe that the ways in which we control and manage new technologies in energy generation need careful consideration. So, new technical advice would be very helpful here.
I am pleased to have the opportunity to speak in this debate on renewable energy and policy and climate change. I still hope that we are all united in our desire to secure a sustainable energy future for Wales and that this will be directed towards low-carbon and, eventually, carbon-free energy production. I welcome the fact that the Welsh Government’s energy strategy is focused on the generation of renewable energy, and I am pleased with the recent proposals from the Silk commission to endow the National Assembly with more wide-ranging powers over energy policy. I think that it should have been power over more than 350 MW as well.
Despite the persistence of climate change deniers—and this is critical—it is vital for us to recognise the evidence and the important role that renewable energy will play in our future as the environmental cost of fossil fuels becomes ever more apparent. Only last month—we are talking about four weeks ago—in Berlin at the launch of the most recent Intergovernmental Panel on Climate Change report on climate change, the German co-chair, Ottmar Edenhofer, highlighted the need to combat any claims that global warming is not having a detrimental impact on our planet stating:
‘There is a clear message from science: To avoid dangerous interference with the climate system, we need to move away from business as usual.’
And that follows its second report in March this year, which showed how climate change is already having an impact and warned of severe, pervasive and irreversible impacts in the future if action is not taken to address emissions now.
The Welsh Government has been consistent in its desire to support and source alternatives to fossil fuel energy generation, concentrating efforts on investment in clean and sustainable energy sources, such as onshore and offshore wind, solar, tidal and hydroelectric energy. Onshore wind power will, I feel, prove to be particularly crucial. I welcome the leader of the opposition’s agreement with that, as I saw written today. The Pen y Cymoedd project, the largest onshore project for wind generation in the UK, is based both in my constituency and the neighbouring constituency of my colleague Leighton Andrews in the Rhondda. It is currently under construction and it is an example of clean power generation. This is a crucial element as well: it is offering a potential 25-year community benefit scheme, supporting more than 350 Welsh jobs and generating more than £100 million in contracts with Welsh companies. This scheme has already supported many community projects, such as the redevelopment of bike trails in Glyncorrwg and the upper Afan valley, and the developer is proactively working with local communities to identify schemes and projects that will provide sustainable opportunities for local people. So, I am in agreement with point 5(b) of the motion in the respect that I feel that there is a clear need to ensure and safeguard the economic benefits received by local communities from renewable energy projects. However, I feel that there must be more emphasis on those benefits being localised rather than more widespread, as identified in the Liberal Democrat document, so that the affected communities directly receive the benefits coming from the community benefit scheme.
I further support points 5(d) and 5(e) of the motion in that the potential for Wales to become a leader in marine energy generation cannot be underestimated. Our extensive coastline, as mentioned by William Powell, already offers such opportunities and we must recognise that the Welsh Government has already made substantial investment in this area. As part of those hubs, I hope to see a variety of marine technologies explored, and the proposed tidal lagoon project in Swansea bay, which is currently in its early stages and which will be decided by the Department of Environment and Climate Change, may provide further opportunities to look at these in detail. They can potentially offer not only low-cost clean energy production but, again, the opportunity for local businesses and local materials being used along with local employment for local workers and other community facilities such as recreational tourism and perhaps even sporting facilities.
Point 5 (g) of this motion regarding technical advice for hydraulic fracturing and test drilling, I think, is of significant importance. I will declare an interest here, because there is an existing application in my own village about to be considered.
Across the globe, environmental groups have mounted significant protests against the use of what is properly known as fracking. Aside from the fact that a detrimental environmental impact of such drilling and shale gas extraction might well prove to be substantial. There is no doubt that significant public concern exists on fracking and the related industrial processes. So much so that many areas across the globe have actually imposed moratoria on its use, stating that, until it can be proven to be an environmentally clean means of energy production, preventative measures are required to offset the potential environmental impact. Indeed, it is actually alleged that we have seen small seismic tremors as a result of a recent borehole testing site in the UK. Consequently, I support a precautionary stance on this matter and consideration of further examination into potential environmental impact of the energy production method. To that end, I would ask the Minister whether he will have discussions with the office of unconventional gas and oil in DECC to ensure a detailed analysis of the evidence that it has undertaken in order to arrive at a point where guidance can be given.
Y Dirprwy Lywydd / The Deputy Presiding Officer
Finish with this, please.
This is my final statement. We are all aware of the increase in energy needs that is required to support our high-powered lifestyles and the devastating—and often fatal—environmental impacts of our actions. Renewable energy sources must be addressed as they offer a means for us to offset that impact.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call Aled Roberts.
This motion not only deals with technology, which we will need to have because of the problem of climate change, but also it causes us to recognise that there are problems with the infrastructure in Wales. This is a fairly common theme for us, if we are talking about roads or railways. However, we must recognise that the National Grid, to some extent, has been designed for the movement of energy out of Wales, across Offa’s Dyke, rather than to deal with the problem that we have here in Wales. That is why we must, when discussing the future of energy in Wales, develop a network that is intelligent and that responds to the needs of Wales, and that is why, therefore, we will be supporting Plaid Cymru’s amendment 7.
We believe that we should look at this interconnection between the north and the south and ask the Welsh Government, in so doing, whether it is possible to publish any assessment that has been carried out by it or by the National Grid on that technology.
However, in stating that we have to respond to the problems of the network, there is also an opportunity to consider the different technologies available, and in so doing, perhaps focus, in this part of the debate and discussion, on hydro schemes. A number of speakers have mentioned the energy that is produced in the marine environment. Some schemes have been in place for decades—in Snowdonia, in terms of hydro schemes, in Dinorwig, and before that in Ffestiniog, of course. We believe that the Welsh Government should take advantage of the geography that we have here in Wales so that we can respond in this way.
When talking about the network, we have to develop a network that does not have to reject a low-carbon supply or a renewable supply when the demand is not there, or who rely on conventional or nuclear power when the demand increases. However, as David Rees said, when talking about the National Grid networks and, perhaps, some plans for building new power stations, we must also, as an Assembly and as a Government, accept that some communities that are affected more than others. That is why some communities, such as those in north Wales, are opposing some of the schemes that have been put forward.
We must think more broadly about the community benefits available. We must recognise that there are now millions of pounds coming in to some of these rural communities—the very communities that are, perhaps, facing some of the cuts in local government services. However, if we are to be successful in terms of some of implementing some of these changes, we have to think more comprehensively about community benefits. We must have an honest debate on some of the protests that we have seen in Montgomeryshire, for example, where there is quite a strong feeling at grass-roots level that there has been too much focus on a relatively small area and they do not see that they, as a community, are benefiting from those changes.
Finally, I want to look at amendments 8 and 9, tabled by the Tories. We agree that the Welsh Government must support and invest in renewables. We must, as Bill Powell said, get rid of this over-reliance on fossil fuels, but in stating that we also believe that there are enough applications in the planning pipeline to fulfil the UK Government’s 2025 target, we as a nation must go further than the current targets. We must look beyond 2025 and state that we are willing to shoulder some of the burden in terms of renewable energy and to take this issue seriously. We believe that local communities must play a full role in the planning process, but we also believe that some of the comments made by the Tories will impact upon the confidence of the sector in investing in these projects.
I agree that it is important that communities feel that they are involved in any changes that are going on around renewable energies and other things, but I also think that it is very important that we do not make ourselves victims or captive to the flat-earthers in our society who are in denial about the changes that we absolutely have to make for future generations. There was an article in the ‘Western Mail’ yesterday, where the AA was decrying the fact that fuel sales have gone down absolutely since 2008. Instead of celebrating the fact that we now have cars that are more energy-efficient, it was decrying the fact that less fuel is being consumed.
Therefore, I think that we have to tackle this in many different ways. We have to reduce our energy consumption, with energy conservation measures, and we have to reuse things and then get more efficient at producing forms of electricity and energy that do not harm the environment. We have huge opportunities in Wales, which several Members have spoken about already. With tidal energy alone we could be self-sufficient in energy in Wales, but that is something that, obviously, involves quite a lot of complex technology and which is very hard for the average person in the community to feel that they could be individually taking part in. It relies on people with a great deal of expertise and, indeed, money to help bring that about.
However, on a day when there is a lot of bad news about the state of the Co-operative Bank, there is a home-grown co-op here in Wales that is alive and kicking—a success, in the Amman valley, which was launched in the Senedd some three months ago, and that is the Egni solar PV co-op, which was launched by Gwenda Thomas. In less than three months, it has managed to raise £155,000 from a community subscription to build 155 kW of solar PV panels on community buildings. It will save more than 1,000 tonnes of carbon dioxide over the lifetime of the project. I think that that is an excellent example of what can be done. It has minimum shares of £250, but, with the use of crowdfunding, people who wanted to contribute less than that were also able to get involved. It will offer a 4% return on investment, which is not bad given current bank rates.
So, inspired by the Egni project, I thought that I would apply the science to looking around my constituency, which is one of the most densely populated urban areas in Wales. Nevertheless, it is fertile ground for feasible renewable energy projects. Not least, the roofs of every single building—at least for those buildings that are correctly oriented towards the south or south-west—are an opportunity for making or saving money from solar panels. In addition to that, the layout of the housing estates in the Llanedeyrn and Pentwyn areas of my constituency also provide fertile ground for ground source heat pumps. So, I was fascinated that, in a short space of time, since the middle of February, I have had expressions of interest from schools, housing associations, churches, care homes and leisure centres that are interested in lending their roofs in order to be able to lower their own bills and reduce carbon emissions. I am hoping to go ahead with a similar scheme in my constituency, following on the inspiration of Egni. This, of course, is using the benefits and incentives from the feed-in tariff, which enables excess electricity to be sold back to the grid. This is a model that has taken off across parts of the UK—
Y Dirprwy Lywydd / The Deputy Presiding Officer
You must finish with this, please.
I feel that it is something that we could be doing in all of our constituencies to ensure that we are fully addressing the challenges that we face.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call the Minister for Natural Resources and Food, Alun Davies.
Thank you very much, Deputy Presiding Officer. It is a real pleasure to reply to this debate, which has explored all of the different aspects of energy policy and the potential and opportunities available to us. The Government will be supporting all of the amendments that have been placed on the agenda this afternoon, with the exception of those placed by our Conservative friends. At the risk of being seen as somewhat churlish, I did feel that Russell George gave us a masterclass in the ‘on the one hand, and on the other hand’ school of politics this afternoon. I still have absolutely no idea at all where the Welsh Conservative party stands on climate change. Is that not quite a statement? It is one of the greatest challenges facing the globe today and the Welsh Conservatives do not know where they stand.
Will you take an intervention?
Perhaps we will be enlightened.
I thought, Minister, that I was quite clear on where we, the Welsh Conservatives, stand. We believe that man-made climate change is one of the biggest significant issues that we have to deal with, as a country and in the world. That is our position; that is the view of the Welsh Conservatives.
We might have moved forward there. It is a great significant issue, but does it drive and inform policy? That is the question. The other two amendments that you have tabled seem to have the objective of preventing renewable energy from being developed. The Conservatives seem now to be taking the view that they oppose all onshore wind development with the single exception of that being planned on the land of the leader of the opposition. [Assembly Members: ‘Oh’.] So, we now have a situation—and this is something, is it not?—whereby the official opposition in this place marches up and down the country, up and down Wales, campaigning against every single development on onshore wind and supporting it on the land owned by the leader of the opposition. They call that a policy position. They ask Members here to support an amendment saying that. I tell you, we will not. We will not do it today and I do not think that anyone else in this place will do so either.
On amendment 3, we accept that the limits placed upon us by the UK Government mean that we are not able to realise all the ambitions that I think we share in most parts of the Chamber today, and, as the First Minister outlined some weeks ago, not only do we want to see the Silk recommendations developed, we want to see further devolution of energy consents to Wales. We want to be put on an equal footing with Scotland and Northern Ireland. We did not feel that the threshold of 350 MW was presented with a compelling case.
Amendment 4—and I felt that Alun Ffred made a very good case for it—asks us to explore the potential of establishing a publicly owned not-for-distributable-profit arm’s-length energy company. Let me say this: we are looking at how we develop energy projects. We will clearly do that in different ways in different places using different technologies. However, the more important point in the individual motion, though we are happy to accept the amendment, is this: we need to use the resources we have available to us, in terms of the resources of Government, in the form of the public resources available to us, to take down and systematically remove the barriers that are currently preventing the development of renewable energy projects and to then enable those projects to go ahead. Now, it may well be that using a public vehicle will be a way for us to do that, but we would also support community-led initiatives and private business-led initiatives, and, through the rural development plan, I would like to see many more rural businesses, seeking to take this up as well. So, we will support that, but we will also want to go further and to do this in different ways.
Amendment 6 asks that we fund a nationwide retrofitting scheme to cut energy consumption. Of course, we do fund retrofitting schemes. We do not have the funds available to us to do all that we would wish to do, but I shall be announcing a review very soon of Nest and Arbed, and we will look to how we can take those schemes forward. They have been successful to date, but we want them to be successful in the future, and that means that we do not simply do in the future what we are doing today or what we did yesterday, but that we will do in the future what new technology and a connected community allow us to do while continuing to retrofit homes where necessary.
Amendment 7 asks that we publish any research into the feasibility of building a grid connection between the north and south of Wales. This, of course, is something that has been debated and discussed. I think that National Grid is looking at the options for such a connector. Clearly, the Welsh Government would seek to support that, for the reasons given by speakers supporting the amendment, such as William Powell in introducing the motion, and we will support that.
However, fundamentally, let me say this: in terms of where we are going, there is irrefutable evidence that we are seeing irreversible climate change taking place that will effect different weather patterns and affect the way that we do business as Governments and as people. That must drive policy, and it must underpin the approach that we take to the generation of energy. However, let me say this as well: the development of distributed energy generation and the development of renewables is not there simply to address climate change and climate change alone, although it is an important driver. It must also be there to drive economic policy and to drive social policy. All too often we have said that we can do one thing or we can do another thing—we can address fuel poverty or we can address climate change; we can have economic growth and jobs or we can have a green economy. Let me say this: through the development of renewable generation, we can have all of those things and achieve all of those different objectives. We can start to address fuel poverty not only through ensuring that we retrofit, which we are already doing, but by enabling community-owned generation sources and facilities to deliver energy to people who need it and to people who are at the moment suffering the impacts of poverty. I would ask every single person in this Chamber today to look at the deep place study that has just been published from my home town of Tredegar and to look at that as a template not only to generate energy, but to address fundamental social issues and to create jobs and sustainable economic growth.
We have the opportunity to do all of these different things, and the ‘Energy Wales’ strategy asks us to deliver those things. I believe that the motion that has been placed on the agenda this afternoon by the Liberal Democrats supports many of those ambitions and objectives, and if the Government amendment is supported by the Chamber this afternoon, we would be happy to support the motion.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I call Kirsty Williams to reply to the debate.
I thank everyone for their contributions to the Welsh Liberal Democrat debate this afternoon. I welcome what Russell George had to say in moving the amendment on behalf of the Welsh Conservative group about the real threat that climate change poses not just to Wales, but to the globe. However, I must say that that message was significantly diluted by what you went on to say about so-called eminent scientists who question man-made climate change. Let us be absolutely clear: the overwhelming scientific view is that it is happening, and it is happening because of the activities of all of us across the globe. We need to act.
I am glad that Alun Ffred, too, in his contribution, recognised what I would regard as dangerous views being espoused by UKIP in this regard. Not only are they not willing to accept the overwhelming scientific view, they do not want our children to hear about it either. I think that is particularly sinister, and is reminiscent of some of the bans in other countries on the teaching of the evolutionary process. It is absolutely vital that such views cannot win over.
Alun Ffred also went on to raise the issue of energy consents, and Liberal Democrats have long called for energy consents to be devolved to this institution. We were doing that, first, in the face of a Welsh Government that did not want those powers, and when a previous incarnation of the Welsh Government decided that it did want those powers, it was turned down repeatedly by a Labour Government in London. What I am really pleased about now is that the recognition that greater powers should come to this institution has been made by the Silk commission and accepted by the Welsh Government, and I am really hopeful that those powers will find themselves into the manifestos of all political parties as we go forward to the next general election.
We will support Plaid’s amendments 4, 6 and 7. There is a great deal of synergy between what those amendments say and the detail of our policy paper. It is just impossible to put all of that detail into a particular motion.
I thank David Rees for his contribution, where he reiterated the point made by Eluned Parrott that, rather than being a threat to our economy, actually renewables could be a huge boost and driver for Welsh economic success. You are right: projects like the Swansea lagoon, which we support also, could be exemplars, and could be a real boost in terms of employment, boosting skills within the workforce, and a really positive development. I thank him for his careful and considered comments about the need for a technical advice note with regard to fracking—a view that we support, which was supported by David Rees, and which is also the view of the Welsh Local Government Association; it would like to see a TAN being brought forward in this regard.
Jenny Rathbone reminded us that actually there is not a part of Wales that cannot contribute to this agenda. A great deal of time has been spent on offshore wind, onshore wind and tidal resources, but actually there is not a part of Wales that cannot contribute to this agenda. She went on to remind us that there are many ways and many different technologies that we must utilise if we are to make progress in this regard.
Minister: churlish? Surely no-one in this Chamber could ever accuse Alun Davies of being churlish. [Laughter.] But, I did welcome what he had to say about energy consents, and what he had to say about Arbed and Nest. Those are two projects that the Welsh Liberal Democrats have supported, and actually increased the budgets for when we negotiated budget agreements with the Welsh Labour Government. However, what the Minister did not say in his contribution this afternoon is why the Welsh Government has set its face against issuing a TAN on fracking. It has failed to engage in that part of this debate, and that is disappointing. If the Government in intent on deleting that from the Welsh Liberal Democrat motion, the Minister should explain why that is the case, and why he would set his face against views being expressed inside this Chamber, and outside it, about how a technical advice note with regard to fracking would be of benefit and is desirable. I am sorry that he failed to do that in his contribution this afternoon.
I am pleased that we have been able to establish a consensus about the need to act and about how this particular policy agenda is not just about making a contribution to protecting our environment for generations to come, but that it actually presents Wales with a real opportunity, in the Welsh economy, to use the natural resources that we have been blessed with to drive down energy prices for our citizens while providing good clean energy to the rest of the UK. I thank Members for their time this afternoon.
Y Dirprwy Lywydd / The Deputy Presiding Officer
The proposal is to agree the motion without amendment. Does any Member object? There is objection, therefore, I defer all voting under this item until voting time. Voting time now follows.
Voting deferred until voting time.
Y Dirprwy Lywydd / The Deputy Presiding Officer
Before I conduct the first vote, are there three Members who wish for the bell to be rung? There are not, so we will proceed.
Result of the vote on motion NDM5497.
Motion agreed: For 36, Against 12, Abstain 0.
Result of the vote on motion NDM5498.
Motion agreed: For 32, Against 16, Abstain 0.
Result of the vote on motion NDM5499.
Motion not agreed: For 5, Against 43, Abstain 0.
Result of the vote on amendment 1 to motion NDM5499.
Amendment not agreed: For 11, Against 37, Abstain 0.
Result of the vote on amendment 2 to motion NDM5499.
Amendment agreed: For 32, Against 16, Abstain 0.
Result of the vote on amendment 3 to motion NDM5499.
Amendment agreed: For 37, Against 0, Abstain 11.
Result of the vote on amendment 4 to motion NDM5499.
Amendment agreed: For 48, Against 0, Abstain 0.
Result of the vote on amendment 5 to motion NDM5499.
Amendment agreed: For 25, Against 23, Abstain 0.
Result of the vote on amendment 6 to motion NDM5499.
Amendment agreed: For 37, Against 0, Abstain 11.
Result of the vote on amendment 7 to motion NDM5499.
Amendment agreed: For 48, Against 0, Abstain 0.
Result of the vote on motion amendment 8 to motion NDM5499.
Amendment not agreed: For 11, Against 30, Abstain 7.
Result of the vote on amendment 9 to motion NDM5499.
Amendment not agreed: For 18, Against 25, Abstain 5.
Motion NDM5499 as amended:
To propose that the National Assembly for Wales:
1. Notes the publication of the Welsh Liberal Democrat report ʻPowering Wales’ Future’.
2. Regrets that the UK Government is increasingly denying the overwhelming evidence which substantiates climate change.
3. Regrets the restrictions placed on the competence of the National Assembly for Wales in the field of energy.
4. Recognises that a sustainable low carbon future can be achieved through an ambitious change in how we generate energy.
5. Acknowledges that a smart and diverse grid network is essential for ensuring that our future energy needs can be met in a reliable and sustainable manner.
6. Calls on the Welsh Government to:
a) review Technical Advice Note 8 to permit updates which reflect technological improvements and the development of new Strategic Search Areas, to encourage new projects and reduce existing concentrations;
b) explore the potential of establishing a publicly-owned, not-for-distributable-profit, arm’s length energy company;
c) work with industry to develop regional community benefit schemes, so that communities along transportation and grid corridors can benefit from the economic investments which come with renewables;
d) maximise the economic benefits of renewables by working with developers and educational institutions to expand supply chains and centres of excellence for the next generation of engineers and apprentices;
e) explore the development of Marine Energy Hubs to provide a safe environment to manufacture and test emergent marine technologies to help Wales gain a competitive advantage;
f) focus public support for research into large scale electrical storage technology such as batteries;
g) explore the potential of developing new pumped storage facilities so that more energy can be stored for peak time usage and ensure a stable supply of low carbon electricity;
h) fund a nation-wide retrofitting scheme to cut energy consumption and lower energy bills for consumers; and
i) publish any research into the feasibility of building a grid connection between the north and south of Wales.
Result of the vote on motion NDM5499 as amended.
Motion NDM5499 as amended agreed: For 32, Against 11, Abstain 5.
Y Dirprwy Lywydd / The Deputy Presiding Officer
I ask that all Members who are leaving the Chamber do so quickly and quietly, please.
Y Dirprwy Lywydd / The Deputy Presiding Officer
The final item is the short debate and I call on Mike Hedges to speak on the topic that he has chosen.
I have given a minute in this debate to Rebecca Evans, Jocelyn Davies, Julie James and Bethan Jenkins.
Stating something that sounds a bit strange: it is very expensive to be poor. This is not a new phenomenon—Jesus threw the moneylenders out of the temple. We even have the old word ‘usury’ for the practice of making unethical or immoral monetary loans intended to unfairly enrich the lender. We also have a more modern word—‘loan shark’.
Historically, Christianity in much of medieval Europe and Islam in many parts of the world today have regarded charging any interest for loans as sinful, never mind the high interest rates that are charged by some lenders today. Some of the earliest known condemnations of usury come from the Vedic texts of India. Similar condemnations are found in religious texts ranging from Buddhism to Judaism. Many nations, from ancient China and ancient Greece to ancient Rome, have outlawed loans with any interest. The Christian church in medieval Europe banned the charging of interest at any rate. The pivotal change in the English-speaking world seems to have come with the permission to charge interest on lent money by Henry VIII—another problem that Henry VIII gave us.
Many people take out a loan until pay day. Many people in here take out a loan until pay day—they use a credit card. It is paid back when the bill becomes due on or after pay day, and the cost is zero. For those who have money, the cost is zero; for those who do not have money, the cost can be quite excessive.
I take an example of how all of this works from that well-known socialist journal, the ‘Daily Mail’. Jenny Poyser spent £8,000 on a new kitchen using a credit card with no interest to pay for 15 months. She says:
‘With a loan we would have been paying interest, whereas the credit card was interest-free. We could also repay as and when. In the months when we were on holiday or preparing for Christmas we could make just the minimum repayment.’
Jenny works as a project manager and is married to Matt, who runs his own accounting business. There is £6,000 left to pay on the card and time is running out before interest is applied, but Jenny says she is ready: she is going to change cards. The plan is to pay off what they can and transfer to another 0% balance card. Unfortunately, if you are poor and unable to access a credit card, you will end up paying large sums, either borrowing from a doorstep lender or a pay-day lender.
Let us look at the cost of borrowing £500. ‘Not a very large sum of money’, I would think that most people here would think. However, to many of my constituents, it is the sort of loan that they look to take out to pay for Christmas or, in many cases, for a funeral, which can be incredibly expensive and often comes at a time when you do not expect it. Pay-day lenders lend amounts that have to be paid within 30 days. For a loan of £500, you would have to pay £278 in interest for 30 days—56%. A loan from a company can cost you £118 and an unarranged overdraft can cost £95 for one month, while a credit union—the best place to borrow, and I wish that more people got involved in them—costs £36 for up to 12 months at 7%. Overdrafts can cost £8 for one month, but a credit card at 0% costs you nothing.
How do people who are relatively affluent borrow? Do they go to pay-day lenders? Do they go to unarranged overdrafts? No; they use the benefit that they have of being able to use credit cards, and benefit by being able to plan how they spend it.
I plan to give some examples using the words of people affected. The first is someone some of you may have seen, Serai Hann, aged 33, a constituent of mine who lives in Bonymaen. She took out several pay-day loans over three years ago. She was on her own, looking after two children and, unsurprisingly, struggled to repay. Her financial plight saw her fall into depression, but Serai found the help she needed from a family support worker and the friendship of a group of other young mums near where she lives in Swansea. They had all had exactly the same problem with pay-day and doorstep lenders and were angered by the high interest rates, lax checks, if any were done at all, regarding whether an applicant could afford to repay the loan, and the barrage of daytime television and radio advertising. If you have seen any of these tv adverts, you will know that it makes it all look comfy and cosy, as if they are nice people who will help you with a few pounds, but the reality is that it is causing a huge amount of upset and huge financial problems to very many people, many of them my constituents.
This led the group to join forces to run a local campaign warning others about the dangers of pay-day lending. Serai, who is a stay-at-home mum for Tayla, aged 4, and Logan, aged 3, is now a spokeswoman for Sharkstoppers, a national campaign for fair credit. She says that she is campaigning for friends as much as for herself. This follows horror stories from borrowers who have had to cope with debt collectors peering through the windows of their home and tailing them in cars and, worst of all, following the children home as they know that the door will be opened for them.
Serai stated that joining the campaign has made her feel empowered, and she has started saving £5 a week with a credit union. She has said that:
‘The easier option is not always the best. It’s hard to say no when money is pressed into your hands, but there are better ways.’
Sometimes, that is actually what happens—people come and press money into your hand. They come with £100 in £10 notes, because it looks more than it does in £20 notes; they press it into your hand and say, ‘You can borrow this’.
Movement for Change in Swansea is taking off. High-cost credit companies would have been rubbing their hands at the prospect, last year, of another year where prices rose faster than wages and the teeth of the Government’s cuts sank further into the flesh of poorer communities across Britain. People looking for a way to treat their families over the festive period would have been looking for quick and easy money. Sadly, if the incessant advertising is anything to go by, they probably had a bumper Christmas. However, in Swansea, the Movement for Change activists running Swansea Bay Fair Credit made a dent in their plans. Unfortunately, it was only a dent.
After action and negotiations with the ‘South Wales Evening Post’ and the Wave, Swansea Bay Fair Credit ensured that, in the run-up to Christmas, there would be free advertising for the local credit agency spread far and wide, and the tactic worked. Denis Greenall at Loans and Savings Abertawe said:
‘It was incessant…as soon as the ad went out…we were just inundated with calls.’
That, I am sure, is what happens to a lot of these other people when they put the advert out: they are also inundated with calls.
The impact that Swansea Bay Fair Credit has had on fair credit was immediately apparent as soon as the campaign started. The rate of growth in savings increased dramatically once the campaign began in September, and the number of approved short-term loans grew alongside that. That trend continued to Christmas, before a spike thanks to the work of Swansea Bay Fair Credit. In the three months prior to the beginning of the campaign, LASA approved 50 loan applications. That grew considerably once the campaign began. However, in December, that spiked to over 100 in a single month. Those loans totalled £50,000. Broadly, that saved over £35,000 for LASA members who would otherwise have had to go to pay-day lenders and paid sky-high interest. Really, that is something that we need to be promoting more and more in order to get people away from these high-interest lenders and get them to borrow from the local credit unions. Credit unions are something that Members across the Chamber fully support. They really are an important way forward.
I will finish with the testimony of someone who worked as an agent for a well-known doorstep lender:
‘We were paid commission only. You were self-employed, so all phone calls and petrol costs had to come out of your commission. The more loans you sold, the more commission you received. If you refused a loan to a potential customer, for whatever reason, you were asked into the office to explain your reasons and to explain why you were not doing your job of getting these loans. You were told that you should do better and not to refuse any loans. There was competition to see which agent could get the most new customers. Canvassers had the job of signing up new customers and were paid £10 for each one. However, if the customer did not make the repayments, it was the agent’s responsibility and not that of the canvasser. We had no advice or training on how to deal with non-paying customers. Actually, in one case, one person sold a loan to an empty house. For every non-paying customer, you would lose commission on two other paying customers. Effectively, you were punished by losing commission on three customers. This put huge pressure on us to put pressure on customers to pay.’
I think that, sometimes, many of us blame the people going around collecting the money as though they are the problem. They are just part of—. They are just equally victims of the people who are running these schemes. They quite often live in the same community and they are quite often equally as poor.
‘A loan was sold by a canvasser to an empty house once. It was kept on my books for 16 weeks, causing me to lose commission on two paying customers for the whole time. Perhaps the worst thing is when, as an agent, offering existing customers bigger loans to repay previous loans. I wouldn’t do that. I felt a responsibility to the customer and was worried about how on earth they would repay a bigger loan if they could not pay current ones. This also meant my losing out on three commissions.’
The other little trick is that, if someone owed £200 and they paid back £100, you would give them another loan of £200, but you would not give them the whole amount because you would use the other £100 to pay off the loan, but they would still be paying interest on the first £100 as well.
‘The pressure from customers pleased that you were their only hope of accessing money was awful when you had to say “no” as you knew that they couldn’t pay back. Telling your manager that you hadn’t collected enough was awful. Missing a payment and wondering whether it was better to lose more fuel and try again later or lose three commissions was awful.’
Really, the whole idea of going out there and collecting money like this—that is what is awful.
I congratulate Mike Hedges on his excellent choice of topic. I will use my brief contribution to talk about the Keep Me Posted campaign, which acknowledges that, while digital communications are a useful and convenient tool for many consumers, a large number of people still rely on paper-based communications to manage their finances. Research shows us that older people, disabled people and people on low incomes are less likely to have access to digital technologies and that people in rural communities have a preference towards paper-based communications. More than 7 million people have never used the internet and a further 16 million adults in the UK do not have basic online skills. Despite this, some banks, financial services companies, utilities companies, media companies and other service providers show a clear preference for a digital medium with online-only tariffs or charge extra for paper bills, meaning the services can be more expensive for the people who can least afford it.
The Keep Me Posted campaign seeks to ensure that consumers do not face a financial penalty as a result of choosing to receive paper-based bills or statements. Given that we know that many people who require paper-based correspondence do so against a backdrop of deprivation, I hope that Members will also support the campaign.
I have been a member of the Plaid Cymru credit union for many, many years—probably at least 15. However, I can recall other times in my life when cheap finance was not available to me, so I understand fully the position of those who are not in a position to shop around but need finance. I would obviously like to see a capping of interest rates, but we have to make sure that restricting finance does not then push people into the clutches of the loan sharks that were mentioned by Mike Hedges earlier on. I would just like to put on the record really that I commend the Moneyline Cymru initiative through housing associations in conjunction with the Assembly Government, which I think could, along with credit unions, help to fill that gap.
I congratulate Mike on bringing this forward as well. Last week, over Easter, I had the great good fortune to be in America. While I was there, I had a good look at the ‘USA Today’ publication money section, where my eye was caught by something entitled ‘highest, lowest pay-day loan rate surprise’. This told me that Idaho had the US’s highest interest rates for pay-day loans according to a report by the Pew Charitable Trusts, which I recommend to all Members as a good read. The average rate there was 582%—this in the most capitalist nation in the world. Wonga’s quoted rate today is 5,853% here in Britain, just by way of contrast. It also told me that 15 states ban pay-day loans or cap interest rates at 36% and that the federal Government has limited rates offered to any military personnel to no more than 36%. This, again, is in the most capitalist country in the world. I think that it is well worth bearing that in mind.
The Chancellor of the Exchequer was forced, in November last year, to agree that there should be some kind of rate capping, having most reluctantly been brought to that conclusion by the lobbying of nearly every sector of the economy. The Financial Conduct Authority has promised that that will be one of its first acts and it should be looking at that as we speak, because it said that it would start in April this year.
I would like to encourage it to look at America as a good example of how it works.
Y Dirprwy Lywydd / The Deputy Presiding Officer
You are well over a minute.
The research there shows that competition does not increase credit for people who cannot afford it. In fact, the only thing that does increase is this sort of capping. I recommend the research to you as a way forward.
I would like to thank Mike Hedges for bringing this debate forward. I think that it is safe to say that many local authorities are at their wits’ end in trying to control the predatory practices of high-interest lenders who have created a business model in hammering, again and again, deprived communities for every penny that they can get. I read recently, ‘It’s an expensive business being poor’. Never was a truer word said about this morally repugnant business model. Of course, I wanted to find solutions to this in my Member-proposed Bill on financial education and inclusion and we might not be able to do everything, as has been highlighted, constructively, by Julie James, because we simply do not have powers over financial services. However, we do have the powers to educate people that there are always ways other than high-interest lenders and we owe it to deprived communities to use our powers to help them to overcome this additional and unwanted blight on their lives.
So, this is a bid—
Y Dirprwy Lywydd / The Deputy Presiding Officer
Quickly now, please.
[Continues.]—to ask people to consider the measures that I put in place, as opposed to saying that legislation is not necessary.
Y Dirprwy Lywydd / The Deputy Presiding Officer
Thank you. I call on the Minister for Communities and Tackling Poverty to reply to the debate—Jeff Cuthbert.
Diolch, Deputy Llywydd. I welcome this debate and I want to thank Mike Hedges for highlighting the impact that high-cost personal credit lenders have on the most vulnerable people in Wales. Their influence in the very midst of our Welsh communities is posing a harmful threat to the stability of the financially vulnerable and exacerbating the already challenging work that the Welsh Government is undertaking to alleviate poverty.
This debate today demonstrates that we are all concerned about the increasing number of people being drawn into high-interest credit agreements with doorstep lenders, pay-day loan and instant loan companies. Many people are denied access, as has been outlined, to mainstream credit, thus, effectively, forcing such individuals and their families to borrow funds from high-cost lenders at exorbitant rates of interest. Such high-interest products cannot be supported on any level by the Members of this Chamber. We see, on an all-too-frequent basis in our constituencies, how people are struggling to make ends meet. These products might seem like the answer when there is nowhere else to turn, but they often lead to further debt and despair and blight our society.
The regulation of credit rates rests with the UK Government. While this is an area on which the Welsh Government has no direct influence, it is an issue of serious concern to all in this Chamber. The UK Government, as has been mentioned, is to introduce a new law to cap the cost of pay-day loans. The level of the cap, which has not yet been announced, will be decided by the new regulator, the Financial Conduct Authority. The FCA has said that it will consult on the design of the cap in the summer with, I understand, final rules to be published before the end of the year. All lenders will then need to be compliant with the cap by 2 January 2015.
I have recently written to the FCA about the review that it will be undertaking on the way that pay-day lenders and other high-cost, short-term lenders collect debts and manage borrowers in arrears. I want to take an active role in this inquiry process. I want to see urgent measures put in place to address these bad practices and to warn people of the dangers of this. Our collective aim must be to ensure that people know that there are other, more affordable and, I would say, more ethical options available.
While regulation of this industry is not a matter for the Welsh Government, we must focus on what we are able to achieve within the devolved context. Our work in this area supports our tackling poverty action plan, where we target resources across departments to prevent poverty and alleviate its impact on people’s lives, while also helping individuals into work. Tackling the problem of financial exclusion is an important part of our action plan, and we have been working with our partners over the past few years to break the cycle of disadvantage that causes financial exclusion.
Ensuring that alternative, more affordable forms of credit are a viable choice to higher risk customers is fundamental to this commitment. We are working to help people manage their money in a better way, in the hope that they never have to turn to high-interest lenders. Credit unions and advice services have a key role to play in this agenda, to help mitigate this worrying trend. I am proud of our record in supporting credit unions in Wales to build their capacity to support people who are unable to access financial services from mainstream providers and who, otherwise, could be subject to exploitation from high-cost lenders. I see credit unions as a key part of the local network of support that should exist in all communities. By providing access to affordable finance, they are part of the solution to tackling higher cost lenders. Indeed, I have committed almost £1.9 million to support credit unions over the next three years. This money will be used to enable credit unions to provide support to financially excluded people who may not be able to access mainstream financial products. This funding builds on previous funding given to credit unions from the Welsh Government and European structural funds for the access to financial services through credit unions project. This project has helped over 33,000 financially excluded adults to have access to financial services.
As was mentioned earlier today, I want to help increase the membership base of credit unions to support their aims of becoming sustainable, and I will continue to do all that I can in this respect. Therefore, earlier this year, I awarded funding for a national credit union marketing and advertising campaign, which is being led by the North Wales Credit Union. This campaign, launched on 14 April, is working both on a national and on a local basis to further attract new members.
I know that there are examples of where credit unions and partner organisations work together to campaign against high-interest doorstep lenders. I recently attended, together with Mike Hedges, a Swansea bay fair credit campaign event in Bonymaen. I was very impressed by the drive and commitment of the partnership work being undertaken within the local community by the Bonymaen mums and the work with LASA Credit Union and the City and County of Swansea on this agenda.
I want to also encourage closer working between credit unions and advice providers so that people facing financial difficulties are made aware of alternative, more ethical options and other possible solutions to their problems. On 15 April, I announced further funding of £1 million this year to support free and independent front-line advice services, as the impact of welfare changes hit communities. This funding will be based on the growing need for services that offer help with welfare benefits, debt and money management, housing and discrimination. This funding is another example of our commitment to taking action to provide practical help to people who either are living in poverty or might be at risk of falling into poverty. It sends a clear signal about our commitment to tackling inequality and to ensuring that anyone who is struggling to get by does have somewhere to turn.
People who are at risk of using a high-interest lender may also require advice on what benefits they are entitled to. In this respect, we support Citizens Advice Cymru for the Better Advice, Better Lives benefit take-up programme. We know that this programme is making a real difference to people’s lives. During April to March 2014, almost 21,000 people were helped, and there was over £16 million of new benefits gained by those individuals.
A recent research report, prepared by the StepChange debt charity entitled ‘Wales in the Red’, suggests that the percentage of people in debt is higher some of Wales's most deprived areas. The report also examines the rapid growth in pay-day loan use in recent years among the charity’s Welsh clients.
In our most deprived areas, we are supporting a Communities First/Citizens Advice joint project, which will deliver outreach debt advice through on-the-ground outreach workers in Communities First areas. This project will run until 2015. The discretionary assistance fund is supporting our most vulnerable individuals who are unable to meet their immediate living costs, many of whom would no doubt be tempted by high-interest lenders. Awards made from the fund in the first year of the scheme have totalled £27,839 for emergency assistance payments and individual assistance payments. The total spend in the first year is in excess of £7.2 million.
To conclude, financial inclusion matters, because being financially excluded is likely to cause poverty and hardship among those who are already the most vulnerable and disadvantaged members of our society. The temptation to use high-cost lenders among individuals who may fall into this category will no doubt be high, and this will compound the problem. We are clear that we must continue to support and develop more responsible and affordable credit options for all consumers, while, at the same time, encouraging greater financial capability and responsibility. In Wales, our commitment to this is clear and will continue throughout this Government’s term.
Y Dirprwy Lywydd / The Deputy Presiding Officer
Thank you. That concludes today's proceedings.
The meeting ended at 18:37.