Asked by
To ask His Majesty’s Government what are their latest figures for
the gross domestic product per head of population for (1) Wales,
and (2) the United Kingdom.
The Parliamentary Secretary, HM Treasury () (Con)
My Lords, the latest Office for National Statistics data show
that in 2021 gross domestic product—GDP—per head, at current
prices, was £25,665 for Wales and £33,745 for the UK. The UK
Government have made significant interventions aimed at boosting
GDP in Wales and across the UK, including the £4.8 billion
levelling-up fund, the £2.6 billion UK shared prosperity fund and
delivering on investment zones and freeports.
(PC)
My Lords, do these figures not speak volumes? They underline the
failure of successive Governments to close the gap between Wales
and England. With the relevant economic levers being shared
between Whitehall and Senedd Cymru, is it not essential that the
two co-operate on these economic matters? Does the Minister
appreciate how much this is undermined by the refusal of the
Chief Secretary of the Treasury to attend the Senedd’s finance
committee? Is she aware that her colleague, the noble Lord,
, told that committee in Cardiff
last week that a duty should be placed on the Chief Secretary to
attend such committees when required? He said that
“if it needs putting on a statutory basis … that needs to
happen”.
Does she agree?
(Con)
My Lords, perhaps I can provide a little reassurance to the noble
Lord. Yes, the gap between GDP per head in Wales and the rest of
the UK is too large, but Wales has had the highest growth in GDP
per head since 2010 of all regions and nations across the UK,
increasing by 15.7% compared with 6.9% across the UK. He talked
about the Welsh Government and the UK Government working
together. That is something that we have done successfully on
city and growth deals across Wales that were developed jointly by
the UK Government and the Welsh Government. This included £500
million for the Cardiff capital region and over £100 million in
north Wales and Swansea. On his point about the Chief Secretary
to the Treasury, he works hard and closely with the devolved
Administrations—I know that is something he is very committed
to—but I will take the noble Lord’s specific point away.
(Lab)
My Lords—
(Lab)
My Lords—
(Con)
My Lords, I think that noble Lords need to decide between them
which one of them will speak.
(Lab)
May I invite the Minister to examine all the relevant indices of
poverty and deprivation? She will find that Wales is mostly at
the bottom, with 75% of the average, whereas the Government in
levelling up concentrates simply on north-south. Should not the
Government by contrast look also at the east-west divide?
(Con)
I reassure the noble Lord that levelling up is not viewed through
the prism that he says it is. When it comes to the looking at the
needs in Wales and the funding to be matched to them, that is
what we do through the Welsh fiscal framework. In the 2021
spending review, the largest annual block grant in real terms was
assigned to Wales since the devolution Acts were passed.
(LD)
My Lords, for around 20 years, west Wales and the valleys
qualified for EU Objective 1 funding, precisely because our GDP
was among the lowest in the EU. With the figures for Wales
published in May showing a decrease of 2.1% in GDP over the
longer term in Wales, compared with the figures for the rest of
the UK showing an increase of 2%, are we in Wales, in the
Minister’s opinion, facing a short-term blip, or are we heading
for a gradual return to our pre-Objective 1 status, as a result
of the loss of EU funding?
(Con)
The statistics that the noble Baroness refers to are more
experimental than the ones that I used in my Answer, but they are
being refined all the time and they can be subject to greater
volatility due to the smaller size that they represent. However,
the Government are delivering on their commitment to replace
European funding in Wales. As I set out in my earlier Answer,
that is just one of the UK Government’s investments in Wales that
recognise its great potential to grow even further.
(Lab)
My Lords, talking of figures speaking volumes, the Minister will
be aware that last month the annual fraud indicator for the
United Kingdom, which of course includes Scotland and Wales as
well as England and Northern Ireland, assessed it at £219
billion. Are those fraudulent transactions, the muling of that
money and the transfer of it from shell company to shell company,
and the export of it in crypto assets, counted as economic
activity and therefore aggregated into GDP? When the money comes
back into the country to buy houses and land, works of art and
other things, is it counted as inward investment?
(Con)
The classification of these matters is for the ONS, and I shall
get the ONS to write to the noble Lord.
(Lab)
My Lords, the Government’s approach to levelling-up funding has
forced local authorities throughout the UK to compete in a
process that lacks any published criteria. In the second round of
allocations earlier this year, local communities across each of
the four nations of the UK, including Wrexham, Moray, Bolsover
and Belfast, each had bids rejected without any public
explanation. Ahead of the third round of levelling-up funding,
will the Minister work with ministerial colleagues, the devolved
Governments and local authorities to improve the transparency of
the bidding process so that cities, towns and villages across the
UK can have access to funding that is both fair and seen to be
fair?
(Con)
Just to reassure the noble Lord with regard to Wales, in the
first two rounds of the levelling-up fund, £330 million has been
invested so far. That exceeds the commitment that 5% of those
funds would be invested in Wales, but we always seek to improve
our processes around those issues, and I shall happily commit to
working with colleagues in the Department for Levelling Up to
make sure that we build on the success that we have had so far
with this fund.
(Lab)
My Lords, will the Minister take forward with much more vigour
the idea of Celtic Sea offshore wind, which can only really be
built in places such as Port Talbot, where there is deep water
and lots of land? That might help redress some of the economic
disasters that other noble Lords have spoken about.
(Con)
My Lords, the UK has an excellent track record in delivering
offshore wind, and I am sure that that will continue. As I have
said, we are investing across Wales, and that includes two
freeports in Wales—the Celtic Freeport and the Anglesey Freeport,
which will both be backed by policy and planning permissions, as
well as up to £26 million in funding in each area.
(CB)
My Lords, as long as there is a situation in government where
most of the money spent is on emergency situations and coping
with poverty and very little is spent on prevention of poverty
and skilling people away from poverty, we will continue arguing
about GDP and whether it is high or low in Wales or England. We
do not spend money on dismantling poverty—we spend it on making
the poor as comfortable as possible.
(Con)
My Lords, I agree with the noble Lord about the importance of
investing in prevention. That is why we have invested in our
education system, and we have seen our educational outputs
improve under this Government. It is why we are investing in
prevention in our NHS. We also need to capture the importance of
other aspects that contribute to our country when we look at
these matters. That is why we are looking at incorporating
measures when it comes to well-being, for example, and not just
looking at the narrow measures of GDP.
(Lab)
My Lords, if the positive economic figures that the Minister
cited for Wales are correct, is that because we have a Welsh
Labour Government?
(Con)
It is hard to tell from the other side whether there is a success
story or not when it comes to Wales. I think that the best
success comes when the UK and Welsh Governments work together in
the interests of the people of Wales, and the record that we can
see is testament to that.
(Lab Co-op)
My Lords, can I ask a question where I think, for once, the noble
Baroness, who is an excellent Minister, might be able to give me
a positive answer? The Advocate-General for Scotland has agreed,
at my request, to instruct his officials to investigate ultra
vires expenditure by the Scottish Government. That is a great
step forward. Can the Minister give an assurance that her
officials in the Treasury will work co-operatively with the
Advocate-General’s officials?
(Con)
I can give the noble Lord that assurance.
