THE WELSH GOVERNMENT has been accused of misleading the public, ambushing investors, and using the Circuit of Wales project as a political football intended to shore up its vote in the South Wales Valleys after refusing to back the project last week.
NO TO GUARANTEE
The Welsh Government had been asked to provide a loan guarantee of £210m to private investor, the insurance giant Aviva. Had the Circuit gone bust, the Welsh Government would have been left liable for the loan balance but Aviva would have retained ownership of the Circuit.
Last week, Economy Secretary Ken Skates announced that the Welsh Government had decided against backing the project by providing a guarantee to key investor Aviva, claiming that late in the day the Welsh Government had received advice from HM Revenue and the Office of National Statistics that financing the deal would amount to state aid and affect Wales’ capital grant from the Westminster Government.
Mr Skates claimed that the presence of the Circuit of Wales on the books would have meant education and health services would have had their budgets squeezed.
However, Mr Skates’ version of events has been met with withering scorn from opposition parties who say that the Welsh Government’s version of events is disingenuous nonsense and that the Welsh Government has twice delayed pulling the plug on the project for Labour’s own electoral benefit .
INDEPENDENT INQUIRY CALL
Both the Conservative Party and Plaid Cymru have called for an independent inquiry into the Welsh Government’s conduct of the Circuit of Wales deal.
Andrew RT Davies, the Conservative leader in the Assembly said: “The Circuit of Wales has been a Welsh Labour car crash of epic proportions.
“After so many years of uncertainty and false hope, it’s clear that Welsh Government have plenty of questions to answer.
“Whilst I have had longstanding concerns that the Heads of the Valleys Development Company may not be right vehicle for this project, it is hugely disappointing to see it crumbling away in such dramatic and overnight fashion.”
Plaid Cymru Shadow Cabinet Secretary Adam Price claimed that evidence has come to light that the First Minister may have misled the public.
Adam Price said there was ‘compelling evidence the Welsh Government has been guilty of serial mendacity ‘.
“Sadly this project has been characterised by a series of inaccurate and misleading statements made by the Government, ostensibly to justify its own position in the face of potential criticism ,” he added.
“An email written by an Aviva senior director – dated 14th July last year – pointed to the false assertion by the Welsh Government ‘that we requested a 100% underwrite a few days before the rejection (of the first proposal in April 2016), when in fact this deal had been worked up with the Welsh Government (through civil servants) for many months and nothing in our funding structure changed in the run up to the announcement’.”
Mr Price continued: “I have an email from Welsh Government presenting a proposal based on a Welsh public sector guarantee of the debt dated January 26th 2016, confirming Aviva’s assertion. And yet speaking in Ebbw Vale on April 11th last year, as reported by the Western Mail, Carwyn Jones repeated the falsehood when speaking about the rejection of the proposal: ‘It was in the last few days beforehand. We weren’t to know the guarantee would be inflated’.
“These are not isolated instances. They are part of a pattern of duplicity that have characterised the Welsh Government’s approach to this project throughout, constantly shifting goalposts and covering their tracks.”
Mr Price called for an independent inquiry to investigate the matter: “Since the First Minister himself can now be shown also to have misled the public on the Circuit of Wales – all the more pointedly as it was in Blaenau Gwent and in the middle of a keenly fought election campaign – it’s no longer appropriate that he makes this decision as he will now need to be a subject of that investigation, not its judge and jury.
“As things currently stand no-one – business, media, Parliament or public – can be confident our Government is being straight with us. Only a full independent inquiry can begin to rebuild public trust. “
HAMILTON SLAMS GOVERNMENT INSULT
Neil Hamilton AM, UKIP Group Leader in the National Assembly for Wales stated in the Senedd chamber: “Are we really expected to believe, that the government accounting conventions about whether something should be classified as public expenditure or private by the ONS and the Treasury have come as a blinding revelation yesterday, and the cabinet was totally unaware of these conventions hitherto?
“It is an insult to the people of Blaenau Gwent that such a shoddy excuse has been used and a disgrace that so much public money and time was wasted on this decision.
“The Welsh Government now plans to build a £100m automotive business park in Ebbw Vale. What we have now is a proposal from the government to spend £100 m over ten years. Shedloads of money to build a series of empty sheds,” continued Mr Hamilton
“Interestingly the Welsh Government announced this decision after the election; a decision beforehand would clearly have damaged Labour in the polls. What a cynical political decision, a terrible betrayal of the people of Blaenau Gwent and a shoddy excuse for what amounts to the replacement of the Circuit of Wales with a Scalextric set.”
Appearing before the Public Accounts Committee the day before the Welsh Government pulled the plug, a senior Welsh Government civil servant, James Price, told Committee members that he regarded the £9.3m as a fair price to pay for the due diligence that it had enabled the Welsh Government to undertake and suggested that the Auditor was wrong to decide that business risk assessments carried out before providing the money were deficient.
One thing that emerged from that Committee meeting was the broad agreement that due diligence had to take place before the Welsh Government exposed itself to further risk. It was surprising, therefore, that the following day in the Assembly one of those members who had been singing the praises of due diligence taking place committed a complete about face.
Deriding the Welsh Government’s involvement as being an exemplar of ‘the dead hand of government’, UKIP’s leader in the Assembly Neil Hamilton appeared to have forgotten his words of little over twenty four hours earlier: ‘Personally, I think it was a very reasonable punt you took (with the grant and loan). Now we’re talking about much, much larger sums of money, it’s right that a considerably greater degree of examination be undertaken’.
COMPANY DENIES GOVERNMENT CLAIMS
A spokesperson for the Heads of the Valleys Development Corporation (HVDC), the company behind the Circuit of Wales, said: “Along with my team and commercial partners, I am hugely disappointed and saddened that the Welsh Government has failed to support The Circuit of Wales, what would be a game changing development for Wales and in particular the people of Blaenau Gwent.
“We strongly disagree with the decision and the rationale behind it.
“We have always believed passionately, and continue to do so, in this project’s ability to transform and provide opportunities and hope to one of the poorest parts of the UK, not just Wales. The project is totally defined, finance is in place, and construction and hiring could start immediately.
“My team and I will now analyse the Welsh Government’s reasons not to support the development and are actively seeking additional clarification from them. We will then very shortly issue a detailed response before deciding on our next course of action.”
That detailed response, when it arrived, savaged the Welsh Government’s reasoning and claimed that the reasons given to the Senedd for refusing to back the deal were either wrong, specious, or had not been raised with the developer or its investors. In addition, the statement revealed that the Economy Secretary had not met with representatives of the company for over twelve months before making his decision.
A spokesperson for HVDC said: “ This is a real loss for the people of Ebbw Vale, the immediate community and a missed opportunity for Wales as a whole. This is a project that has been totally defined; it is fully financed (with finance in place) with construction and hiring ready to start immediately.
“At a time when the Welsh Government is trying to demonstrate that Wales is ‘ppen for business’, the rejection of this significant infrastructure project will do little to breed confidence within the private sector for future investment in the country.”
Most tellingly, perhaps, HVDC made a concerted attack on the Cabinet Secretary’s assertion there was a very significant risk that the full £373million debt of the entire Circuit of Wales project would be classified against Welsh Government capital spending.
The statement from the Company expressed amazement at the lack of notice given to it that any problem had arisen: ‘The company was never informed or made aware of this ONS and HM Treasury advice during the due diligence process. We were promised by Welsh Government officials that we would be consulted if any significant issues arose during due diligence and given an opportunity to respond.
‘We were not notified that this was a serious roadblock prior to Tuesday’s meeting and never given a chance to respond.
‘The Welsh Government has known about the latest structure of this project since well before February 2017 and could easily have obtained clearer guidance from Treasury and ONS prior to Tuesday’s meeting and informed us’.
The spokesperson continued: “We believe it is important for the people of Blaenau Gwent to have the details of these discussions with ONS and HM Treasury disclosed to the public. What were these discussions, who were they with and when were they undertaken?
“ We wholeheartedly disagree that the support for The Circuit of Wales would be on balance sheet and would require the Welsh government to limit its budget and compromise the building of schools and hospitals .”
The company also claimed that the £100m technology park – funded by public money – announced by Ken Skates as a sop to Blaenau Gwent was scheduled to cost £150m of wholly private money and be delivered in two years: not the ten announced by the Cabinet Secretary in the Senedd.
SCHEME UNDER SCRUTINY
However, the scheme has been the subject of scepticism for some time.
A BBC investigation for soon to be scrapped current affairs programme Week In Week Out, cast doubts on whether or not the company could achieve anything like the promises it had made either in terms of regeneration of Blaenau Gwent or in relation to delivering on its promises regarding the proposed facilities within the time and budget specified. Moreover, the same documentary revealed that £35,000 from HVDC – a company partly funded by the Welsh Government – had been used on landscape gardening on the home of the person fronting the scheme, Michael Carrick.
An investigation by the Auditor-General for Wales criticised the Welsh Government both for a loan guarantee a £7.3m provided to HVDC and a £2m grant provided as seed money. The Auditor discovered that part of the money had been used to acquire a small motorcycle manufacturing business in England and ruled that there had been insufficient regard as to whether the uses to which public money were being put were delivering value for money for the public.
Initial claims that 6,000 jobs would be created and claims of businesses flocking to set up working partnerships on the Circuit of Wales site had also come under scrutiny.
A reassessment of the project carried out by the University of South Wales as part of the due diligence process suggested that 2,000 jobs fewer than claimed would be created. In addition, jobs during the construction phase of the project would be temporary, with the Circuit ultimately employing around 150 full time staff, while the remainder of jobs would be created in spin-off enterprises over a longer period of time.
As this article was being prepared for publication, Michael Carrick, told BBC News: “We haven’t given up on it and I’m hoping government hasn’t.
“The project is too important to walk away. We’ve got the support of our investors, we’ve got the support of our development partners and we want to make it work for government and for the valleys.”
Whether Mr Carrick will be able to overcome the deep reservations of the Welsh Government and proceed with the scheme with their backing is open to question.
Whether the HVDC will be able to develop the Circuit of Wales on the scale planned – or at all – without that backing, is highly unlikely.
Elin Jones congratulates Ceredigion Talking Paper in National Assembly
AM marks 50 years of service by local news service for the blind
Elin Jones AM has congratulated the Ceredigion Talking Newspaper in a statement in the National Assembly for Wales, marking 50 years of service to blind people in Ceredigion and beyond.
In her statement on Wednesday the 20th of January, Elin Jones said:
“Fifty years ago, in January 1970, an innovative charity was established in Ceredigion for blind people, offering the first service of its kind in Wales and the United Kingdom – a service that would enable the blind people of Ceredigion to hear the latest local news in the press.
“That innovative scheme was the Ceredigion Talking Newspaper.
“The talking newspaper was set up by Ronald Sturt, a lecturer at the College of Librarianship in Llanbadarn. Initially, the recordings of local voices reading articles from the local press were on tape cassettes and provided to 18 people.
“Nowadays, the recordings are on a USB, and there are over a hundred regular listeners of the talking newspaper and more than 60 volunteers contributing regularly. The recordings are published weekly and the coverage includes the Cambrian News, Golwg and Y Cymro.
“One reader, Eileen Sinnett, has volunteered continuously for fifty years. What a contribution she has made!
“I would like to congratulate the Ceredigion Talking Newspaper for breaking new ground in 1970, for 50 years of service and for bringing the news, in both Welsh and English, to those who cannot see or read it in Ceredigion and beyond.”
Ben Lake MP pledges support for local pubs in Ceredigion
Ben Lake MP has today pledged their support for the Long Live the Local Campaign to help pubs in Ceredigion keep their doors open. Ben Lake joins the more than 240,000 people who have signed the petition so far, including 335 in Ceredigion alone.
Ben Lake MP is calling on the Government to cut beer tax at the Budget. With £1 in every £3 pounds spent in UK pubs going to the taxman, British drinkers now pay 40% of all beer tax across the EU, but drink only 12% of the beer. Seven in ten alcoholic drinks served in pubs are beer, underlining how directly a cut in beer duty will help pubs. Brewing and pubs in Ceredigion supports 1169 jobs and contributes £23.1m to the local economy.
Commenting on the campaign, Ben Lake MP said:
“Pubs are at the heart of communities across Ceredigion, but with three pubs closing their doors for good every day across the UK, we must acknowledge that these community assets are facing significant challenges as they try to stay open. For this reason I am supporting the Long Live the Local campaign and calling on the Chancellor to cut beer tax for licenced premises in this year’s Budget to support pubs in our local communities.”
Emma McClarkin, Chief Executive of the British Beer & Pub Association, said:
“Beer duty has increased by 60% over the last 17 years and now the UK has one of the highest rates of tax in Europe. When over two thirds of all alcoholic drinks purchased in the pub are beers, a cut in beer tax would go a long way to protecting pubs across Ceredigion. We are very grateful to Ben Lake for their support for the Long Live the Local campaign, and hope that the Government listens to MPs across Parliament and the thousands of people across the country who are calling for a cut in beer tax to protect our pubs.”
Labour leadership election: they’re off!
IN THE days when being leader of the Labour Party meant having the ability to command the confidence of the majority of your parliamentary colleagues, its election process would likely be almost over.
Five candidates made the next round of contest: Rebecca Long-Bailey, Lisa Nandy, Jess Phillips, Sir Keir Starmer, and Emily Thornberry. They respectively have the support of 33, 31, 23, 88, and 23 of their parliamentary colleagues.
Before 1980, Keir Starmer would be home and hosed.
A PLURAL APPROACH
Clive Lewis, who withdrew from the leadership contest, forcefully made the case for Labour to stop behaving like the Exclusive Brethren: “The litmus test of survival for Labour is pluralism – the recognition that we as one party don’t and can’t have all the answers to the complex challenges we face. We are going to have to collaborate.
“It’s not that we can’t win alone, it’s that we can’t change society alone. Since 1918, there have been 28 elections and Labour has only won eight of them, often with small majorities and a short government.
“Labour can no longer impose a future on the country, instead it must negotiate one.”
Ms Long-Bailey, whose media performances during the campaign were only ‘good’ relative to the comic relief offered by current deputy leadership contender Richard Burgon, is favoured by those most closely associated with Jeremy Corbyn’s argument-winning tenure.
She has already drawn the support of party-within-a-party Momentum. Or at least its executive, as members were not allowed a vote. Momentum members have been subsequently presented with a ballot paper for the Labour leadership with only Ms Long-Bailey’s name on it. Democracy in action.
As someone who said she would give the departing Labour leader 10/10 and accepted responsibility for Labour’s last manifesto, she will also attract the votes of those who are intent on campaigning in purity instead of governing (all governments do) through compromise.
In her candidate statement, Rebecca Long-Bailey acknowledges the defeat and calls upon the Party to look inward to establish the reasons why, saying: “We had a chance to help turn back the tide, but we failed. The starting point in the leadership election is to be honest and self-critical about why and then look forward and forge our path to power.
“We have another round of elections in May [not in Wales] and the escalating crises we face mean that building a winning vision of a socialist future has never been so urgent.
Lisa Nandy received only two fewer nominations, despite – unlike Ms Long-Bailey – having had virtually no public profile in the 2019 election campaign. That low level of exposure for an effective media performer followed her walking out of Labour’s Shadow Cabinet over Jeremy Corbyn’s leadership in 2016 and declining to return.
She also backed the UK Government’s Withdrawal Agreement in a key vote in October 2019 and cannot, therefore, be charged with facing two ways on the Brexit issue.
At the hustings held for candidates before the Parliamentary party, Lisa Nandy reportedly made the best impression, giving a clear indication of what Labour needed to do to recapture lost votes, look outward and not navel-gaze looking for utopia.
Making her pitch as an outsider, at her campaign launch Ms Nandy said: “The stark truth is, the path back to power for Labour will never be to build along the ‘red wall’.”
“If we do not change course we will die and we will deserve to. This is the moment when we up our game and recover our ambition.”
Emily Thornberry, who regularly humiliated Boris Johnson when she shadowed him as Foreign Secretary and took regular delight in butchering Theresa May’s stand-ins at PMQs until she was replaced by Rebecca Long-Bailey to dismal effect, is a strong and experienced parliamentarian.
She is also the MP who had to resign from Ed Milliband’s frontbench team after a hopelessly misjudged and snobbish tweet during a by-election campaign in Rochester.
Ms Thornberry has the inestimable advantage among remain-backing CLPs to have stuck to her guns on the membership’s wish to unequivocally support remaining in the EU. In the changed political landscape, however, that strength could prove an electoral millstone with the voting public.
Unless Brexit turns out to be a political and economic catastrophe, it is difficult to see how Emily Thornberry will break through to the voters Labour lost in the last election. Although, of course, that presupposes that the unions and membership want to win an election on something other than a sectarian basis.
Jess Phillips is, perhaps, the most outside of outsiders. She was a constant thorn in the last Government’s side only slightly more often than she was a thorn in Jeremy Corbyn’s. She has never held a frontbench position.
Boris Johnson’s public school debating style does not impress her and clashes between the pair are always ‘direct’.
Her pitch is based upon her ability to connect with voters on a personal level and on emphasising her ‘speaking truth to power’.
In her candidate statement, Ms Phillips says: “I’ve never shied away from speaking out when I thought we were doing the wrong thing – whether that was the handling of antisemitism, waving through Tory tax cuts for the well-off or equivocating over Brexit.
“Boris Johnson fears what he can’t understand. And that includes people like me.
I can win back trust because I am actually honest. And I can beat Boris Johnson because he can’t handle people like me.”
Sir Keir Starmer had a good term as Shadow Brexit Secretary. He tormented the hapless David Davis, made a complete laughing stock out of Davis’ Minister of State Steve Baker, dissected Dominic Raab with equal forensic skill, and – faced with Stephen Barclay – often seemed to speak more in sorrow than in anger at his out-of-depth opposite number. All of which might lead a critical observer to say Sir Keir’s best parliamentary performances have not been against the most testing opposition.
In many ways, in spite of his plummy voice and manner, Keir Starmer is a real Labour success story: his mother was a nurse, his father a toolmaker and he rose through the opportunities given to him to head to University and become a QC on merit.
Perceived as a ‘moderate’, Keir Starmer has quickly moved to push forward his ‘left’ credentials.
His leadership pitch says: “We are an anti-austerity party. We believe in common ownership. We want to build a more peaceful world through a human-rights based foreign policy. We must hardwire the Green New Deal into our every part of our politics.
“Inequalities of every type – power, education, health and wealth – are so ingrained that only a fundamental shift can address them.”
THE KEY PROBLEM
Of all five candidates, only two – Lisa Nandy and Jess Phillips – talk of a need to reconnect with voters Labour has lost. The other three make their pitch on a solely internal basis, as though the answers to Labour’s electoral woes lies within not without.
That will, no doubt, work well in a leadership election for a political party in which only members can vote. Beyond the membership, though, Labour’s new leader must communicate more than a shopping list of policies and blue-sky thought.
The failure to enunciate a clear path to reach voters outside the faithful should give the membership and unions considerable cause for, as Jeremy Corbyn put it, ‘a period of reflection’.
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