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Adam Price (East Carmarthen and Dinefwr) (PC): It is good to follow the hon. Member for Hayes and Harlington (John McDonnell). As a fellow member of the PCS parliamentary group, may I echo his call for an urgent meeting to discuss the Government's proposals? I was as horrified as he was by the scale of the job reductions, the manner in which they were announced, and the impact that they would undoubtedly have on communities throughout the United Kingdom if the Government proceeded with their proposals.
"Tax and spend" has always been something of a lame cliché when used to describe the fiscal stance of a social democratic Government. "Axe and spend" is something of a departure for a Government who still purport to be a Government of the centre left. However, I have learned that it is always a good idea to start with a few warm words of welcome, and I welcome one feature of the spending review. A public service agreement target for regional economic policy, introduced at the time of the last spending review, is still there and indeed has been strengthened in a sense. The Government have committed themselves to demonstrating progress in reducing the persistent gap in growth rates, albeit between English regions. I think that it should be extended to cover the whole United Kingdom because the Treasury retains that wider responsibility for economic performance; but the target is there, and progress must be demonstrated by 2006.
While I welcome that target, however, I must ask how the Government will achieve it. We have the Lyons report, but the right hon. Member for Dumbarton (Mr. McFall) drew attention to the inconsistency between Lyons and Gershon—the fact that the Government are giving with one hand and taking away with the other. That is borne out by the details of the proposals. The biggest job cuts involve the Departments that are most dispersed, and least represented proportionally in London and the south-east of England. As Sir Michael Lyons points out, the most dispersed is the Department for Work and Pensions, just 17.5 per cent. of whose employees are in London and the south-east. The Ministry of Defence has 28 per cent. in London and the south-east, and the Chancellor's Department 25 per cent. Those three Departments, which were ahead of Lyons—which had already dispersed many jobs outside London and the south-east—are the very ones targeted by Gershon.
What is the impact of that? The right hon. Member for Dumbarton asked for a regional breakdown of the efficiency review job reduction targets, and we should like to see one, but I have made a quick calculation myself. Thanks to the Lyons report, we have a detailed breakdown of the proportion of staff in the various Departments who are in London and the south-east vis-à-vis the rest of the country. If those figures are applied to the departmental breakdown in the Gershon report, it emerges that 63,000 of the 84,000 jobs lost will be lost outside London and the south-east.
The poorest, most economically disadvantaged parts of the UK will bear the brunt of the Gershon proposals, and will do so disproportionately. At present 70 per cent. of civil servants are based in the rest of the UK, while 30 per cent. are in London and the south-east. Under the Gershon proposals, 75 per cent. of jobs will be lost outside London and the south-east. Lyons offers
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us 20,000 jobs, but 63,000 will be lost in the north and west of the UK. There will be a net loss of 40,000, and given the multiplier effect of 1.5 in the Government's own Lyons review, another 20,000 will be lost in the private sector.
Of course, we cannot even be certain about the 20,000 jobs mentioned in the Lyons review. Only 30 per cent. of Departments are able to state whether such relocations will happen by 2010. Sir Michael Lyons himself says that, as a result of the Gershon review,
"one implication . . . is that the figure of 19,700 may come down somewhat".
Such a lack of precision about the relocation of jobs is in contrast to the steely determination that the Chancellor has shown in carrying out the cuts. He said that the civil service unions should be in absolutely no doubt that the Government will go ahead with these reductions, and that they are both necessary and going to happen. So there we have it: there is certainty in respect of the cuts, but doubts abound about the relocations.
I agree with the hon. Member for Hayes and Harlington that the lack of consultation with work force representatives was appalling. That is true not only of the first tranche of losses, which were announced in the Budget, but of the second and wider cull that formed part of the spending review. Yesterday, Dave Prentis of Unison rightly said:
"These issues should be dealt with through the established procedures and not announced through the media, which add to people's insecurity".
The Government have been quick enough to condemn—and rightly so—private sector companies that announced large-scale redundancies in the media without advance consultation. I am thinking of Corus, Rover and Marks and Spencer. The Labour party manifesto of 2001 stated:
"When large-scale redundancies are being considered, there is an especially strong case for consultation."
On Monday 7 July 2003, Labour's website ran the following article:
"Workers set to gain consultation rights . . . Trade and Industry Secretary Patricia Hewitt said she wants the changes to lead to an 'no surprises' culture at work and 'an end to the climate where people only hear about job losses from the media, over their breakfasts."
If that were not enough, the Leader of the House said in "Progress", the Blairite in-house magazine, that because Labour believes in rights at work, it will extend information and consultation rights to end the scandal of workers learning that they have lost their jobs by text message. So there we have it: redundancies over breakfast conveyed in the media and by text message are wrong when carried out by the private sector; but redundancies at teatime conveyed by ministerial statement in this House are okay when carried out by the Government. Indeed, they are better than okay. According to a Wales Office press release, they were an "exceptional result" for Wales and a "once in a generation" step change. In one sense, they were exceptional—exceptionally bad—and it certainly was a once in a generation announcement. To my mind, it was the single biggest Government announcement of public sector job cuts since the pit closure programmes of the 1980s.
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To sack one's own employees is bad enough, but to sack somebody else's beggars belief. We were not only told of 84,000 job losses, but reference was made to the curious figure of 20,000 losses across the devolved Administrations and in local government. Rhodri Morgan, the First Minister of the Welsh Assembly, has been busily backtracking on those figures. He said yesterday:
"They are not estimates we have come up with and we are the responsible body in Wales."
He was clearly surprised and, I would imagine, probably a little angry about being bounced into that by the Chancellor. It now seems that the Treasury is saying that it plucked the figure out of the air. It was some sort of nominal, indicative figure and the Treasury had not consulted the local government bodies or any of the devolved Administrations.
All that happened despite the anxiety caused for employees of the Welsh Assembly Government and despite the fact that it undermines the autonomy and authority of the devolved Administrations. It even breaks the memorandum of understanding signed by the Government on communication and consultation. According to that memorandum:
"All four administrations are committed to the principle of good communication with each other, and especially where one administration's work may have some bearing upon the responsibilities of another administration."
Yet Rhodri Morgan did not even know that the Chancellor was going to make a statement about job reductions in Wales and elsewhere across the UK. We also have to ask whether the devolved Administrations were consulted on embracing the idea of local pay, as contained in the spending review. We not only get fewer jobs, we get existing jobs at reduced pay with no consultation with the workers or the National Assembly for Wales.
I did not disagree with every single line in the spending review. It states on page 178:
"Performance in public service delivery and economic development varies across the regions and countries of the UK".
It most certainly does. We have had dismal economic growth records. Growth in Scotland, for example, has been half that of the UK over the past seven years, and Welsh NHS patients face an appalling waiting gap. Pauline Purdey from Bargoed has been waiting nine and a half years for a hip operation and is still waiting.
Why is there such varied performance across the UK? The reason is clear and it is the Treasury's responsibility because the Barnett squeeze is biting very hard in Wales. The figures in the spending review show the increase in the National Assembly's budget over the period covered as 4.5 per cent., compared with 7.1 per cent. for the NHS in England. The only way in which the Labour Administration in Cardiff will be able to match the increase in England is by raiding other budgets. The same applies to education. The increase is 5.7 per cent. in England—so if Wales is to match those improvements and is so far behind, it will have to raid other budgets.
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