Reflections on Wales 2030: A 10 Point Plan for the Welsh Economy

The wider context

Before Plaid Cymru gets down to policy formulation and manifesto preparation, the wider context in which the next British Parliamentary elections will be held needs to be considered. Over the past two decades we have seen the centre ground abandoned by voters across Europe and the US in what some see as a conscious rejection of “we know best” approaches by a closed-off political elite for whom Davos – not Dowlais, Dartford, or Duisburg – is the lodestar.

In the US this surge in populism or rather nativism[1] as opposed to internationalism has been manifested in Trump’s election and in Britain by Brexit, but it is just as prominent elsewhere, even more so in some cases. In Sweden, Netherlands, Denmark, Finland, and Austria, the left has faded, and rival parties of the right have had to tack towards their more right-wing competitors or include them in coalitions. In the Visegrad grouping (Poland, Hungary, Czech Republic and Slovakia) parties that would have been considered far right are now in power and in the first two have even sought to dismantle established liberal norms such as judicial independence, much to the EU’s horror.

Even in stable Germany two party politics has weakened under the pressure of the Alternativ fur Deutschland. The traditional centre left and centre right groupings, the CDU and the Social Democrats, have had to govern as a coalition in the last two Parliaments, a breakdown of political alternation that for the 50 years after World War Two characterised much of European politics. Polls have shown support for “strong man” authoritarian, get-it-done rule growing, even in some hitherto stable democracies.[2]

Finally, in France a centrist president, having won barely more votes than his right and left opponents in the first round of France’s most recent presidential elections, has become an isolated and embattled figure, struggling over Christmas 2018 to keep the cobblestones in  Paris’s grand boulevards out of the hands of protesters, and able to secure approval ratings only in the low 20s from a disillusioned populace that has concluded he is not the break with the past he promised to be.

In Britain the rise of UKIP has not been accompanied by representation in domestic Parliaments (except in Wales) but it won the vote for Brexit, persuading a majority to accept its key strategy rather than that of all three traditional UK parties, the SNP and Plaid Cymru. It took more votes than any other party in the most recent European elections. In Scotland the SNP has been the beneficiary of this nativist/populist surge though it presents itself as a bastion of the kind of views the more internationalist-minded support.  (Its equally successful counterpart electorally in Catalonia, which won on a nativist platform, has been put down by force by Spain’s left-wing populist party, Podemos.)

In Spain, as in Greece populist parties from the ostensibly far left and not the right have been the ones to break open the traditional left-right duopoly of politics, demonstrating that “a curse-on-both-their-heads” movement can win through from both ends of the political spectrum. It can also arise spontaneously without direction or central management – the Gilets Jaunes in France.

Where does Plaid Cymru stand in this modern maelstrom? Plaid has in the past been a populist/nativist party, pursuing Wales First policies (more economic and political powers for its unit, Wales, the creation of jobs for people in Wales, support for the domestic language and bilingual education and usage, and opposition to incomers, especially monoglot non-Welsh-speakers moving into Welsh-speaking areas). In recent years, however, in a tilt away from its north and west heartlands towards more populous and hence vote-rich south Wales, it has sought to portray itself as left of Labour. This policy seemed to work best in 1999 when Plaid was rewarded with its best performance to date in Assembly elections, the public having decided in the referendum two years earlier to go down a populist/nativist route to demand (albeit narrowly) more local control, and evidently concluding that the party that had fought so hard and so long for just such an outcome could best be trusted to manage the process.

This new leftist approach with a strong emphasis on social issues had some logic during the early years of the Blairite New Labour revolution when Labour became an enthusiastic supporter of neo-liberal economic, free market policies. It was closed off firstly by Rhodri Morgan’s clear red water philosophy, which began the process of regaining Labour its stranglehold (albeit moderated later by Liberal and Plaid coalition partners). The election of an unashamed Corbynite, Mark Drakeford to Labour’s leadership, has now made a more-Labour-than-Labour approach completely unrealistic for Plaid.

So, the questions for Plaid are these. What has it learnt from the rise of populism over the past two decades? Where are the votes of the vast bulk of moderate centre/centre left voters in Wales going to go in forthcoming elections? Will they renew their support for, or return to Labour, confident it will best serve their interests under its new leader? Just as saliently, if Brexit goes ahead and UKIP recedes, having been seen to have largely done its job and not to be able to develop a credible set of policies on other issues (or implodes through internal scandals), will plague-on-all-their-houses forces gather around anti-Assembly advocates? It would be easy to dismiss nascent stirrings as a phenomenon that will quickly evaporate but the same was said two decades ago of UKIP and look what they achieved. Polls already show the antis winning list seats in the Senedd and they could credibly cast Plaid as just another of the old parties. Do we really want this debate to re-open?

This should raise serious warning flags about criticising the Assembly years since 1999, even if this is seen as a way of attacking Labour. The first paragraph of Adam Price’s document, Wales 2030: A 10-Point Plan for the Welsh Economy, claims the Welsh economy has remained at a standstill for 20 years at the bottom of the UK’s prosperity league, and that, while Scotland has had a devolution dividend, Wales has made no relative progress since 1999. Though the qualifier “relative” is important, the impression that will be picked up is that devolution has failed. This is untrue – there have been gains across many fields.[3].

In employment Welsh activity rates now match those in the rest of Britain – an historic achievement for which both the main parties can perhaps, and certainly will, claim credit, Labour for Assembly policy, the Conservatives for Westminster measures. Rates in Wales have historically been five percentage points lower than the UK and many economists thought the gap would never be closed.  We need to know more about the composition of Welsh activity rates before closing the book on this one – full-time, part-time, male, female etc., – but it has happened. Employment has grown to record numbers in a slowly rising population and in some recent months in 2018 Welsh unemployment was lower in percentage terms than that of the rest of the UK.

At the end of Wales 2030 these questions are posed. What has been the dividend? Has it all been made worth it? Again, these questions are put to stress how important the election of a Plaid government in 2021 will be. However, opponents are likely to say that if Plaid – which has had self-government as its raison d’etre for nearly 100 years – now thinks it has been pointless, what use is it to anyone? Save the money by getting rid of the politicians and bureaucrats in unloved Cardiff Bay!

A much better pitch would be – “these are the ways in which Wales is better since 1999 but this is how it could be much better still! Put the government of Wales in the hands of those who fought for it for so long and believe in it wholeheartedly, unlike their opponents, and let’s build on progress to date”. “Give Wales a Future”, “Give Labour a Break – Give Plaid a Chance” encapsulate this. The latter would tie in with the idea that Plaid believes in devolution in a way the other parties do not. It would also stop short of merely indulging in ritual criticism of Labour, by suggesting the party has not totally failed devolution, but is now exhausted and needs time out of office to revive its ideas. It will be tough, but the voters might just be persuaded that alternation of government in Wales could bring better results than one-party rule.

If it is to break through the 10-14 per cent ceiling that has kept it captive for most of the past nearly 100 years, Plaid needs to be able to present itself once again as a new, exciting and insurgent party and not just as a Wales-leaning variant on the London-based parties, and especially Labour. It certainly does not need to be seen criticising the institution the creation of which it spent so long seeking.

Policy Development Implications

Crucially, Plaid must make it clear it is on the side of the communities that make up Wales and of the community that is Wales itself. This may mean de-emphasising and even rejecting much of the rights-based, individualist focus that has dominated the political thinking of all parties over the past few decades, policies that will have little traction with the voting public Plaid is seeking to attract. Greater prosperity for Wales will be achieved, it should argue, through a re-invigorated approach to economic and education policy, drawing on a revivified (and if necessary reformed) administrative machine supporting the Senedd. (It should not be a matter of inventing a host of new institutions and re-booting others. Existing levers, including a not insubstantial civil service, should in most cases be adequate to put in place the changes needed, and if not should be reformed rather than duplicated.)

Policy needs to be more challenging across the whole spectrum of issues and not simply a matter of trying to come up with tweaks to existing economic, educational, social and cultural approaches. Within the economy, a decisive shift away from the cultivation of anchor companies (which seem determined to melt away despite decades of taxpayer support, as in the case of Ford) towards grounded companies as Wales 2030 suggests, is right and should be boldly and clearly stated. A greater role for the state within the private sector, possibly made easier by Brexit, (provided EU state aid rules no longer apply under any new deal) can be justified, too. The “nationalisation” of Cardiff Airport has, for example, preserved civil aviation in Wales where under private sector control the site of this essential modern facility would by now probably be a housing development. This should be a spur to finding other areas where the state can help.

The Guardian columnist Polly Toynbee has written convincingly to show that the role of the state as pump-primer and key shareholder has been important across capitalist economies, including the US, yet it remains anathema to successive UK governments, which have sought instead to diminish its role. (The state of Lower Saxony has a blocking shareholding in Volkswagen, which has survived successive EU legal challenges. France has a 15 per cent stake in Renault. French, Dutch, and German state organisations own a significant share of Britain’s energy, water and transport undertakings).

Providing it can find competent managers to fulfil board roles – and this is a big if – a Plaid Welsh Government should look to guide the development of crucial businesses in Wales, intervening where necessary to ensure key locally-owned employers are enabled to stay in Wales. (It is not just in the Missing Middle, however, that policies are needed to ensure the survival and growth of successful local businesses. Our only FTSE company, Admiral, could be subject at any time to a hostile or agreed take-over by a big European or US insurance giant that wants to acquire its customer base. Brains, our biggest food and drink and hospitality company could be sold, like London brewers, Fuller at the start of 2019. Would Plaid have anything to say on issues such as these?)

In transport, a Wales-first approach is also needed and here Labour has taken useful steps that could be built upon. In Transport for Wales we have an embryo Welsh transport authority whose remit could be gradually extended beyond rail to buses and other transport media as well. We still have two public sector bus companies in Wales, Cardiff Bus and Newport Bus, but Cardiff Bus has recently reported a £2m loss.  The profitability of its routes is being nibbled at by the blue and white buses of Singapore-owned N.A.T.  We need to avoid a trajectory where Cardiff Bus will be so weakened by unnecessary competition in what is a natural monopoly that Scottish-owned First Group or Germany’s Deutsche Bahn[4]-owned, Arriva, come riding to the rescue, motoring away again with the profits and Government subsidies generated by Welsh bus passengers, together with the management jobs in the depots of both businesses.

In education the laissez-fair approach that has characterised successive UK Governments’ approach to universities for the past several decades, leading to a bloated sector of more than 170 UK institutions, some of poor quality, needs to be reversed in Wales. If universities exist to supply society with the leaders it needs across a range of disciplines, Wales’s institutions are not achieving this and, indeed, are not set up to do so – in contrast with those in Ireland and Scotland. Our four top universities equip individuals from England and elsewhere to return to help their home countries thrive and prosper, alongside a minority of Welsh-domiciled students.

They bring income to their host towns and cities both through student spending and relatively highly-paid employment for staff (although at some unquantified cost to the community as well)  but if their impact is largely as providers of “offshore” services they are not serving Wales as well as they might and are diverting resources that could be more wisely spent elsewhere in the education system. We have, for example, a weak business sector which could benefit from much closer co-operation with the university sector, yet a few years back the proud claim of Cardiff Business School was that it was the top-rated business school “in India”.

No-one would argue that universities – as the name implies – should be anything other than open and outward-looking, but to the extent they are in Wales? This may require much less of a focus in our top universities on attracting other UK and foreign students, itself the unintended and damaging consequence of the conversion of higher technical institutions into “universities” and the lifting of the cap on student numbers.

While a leavening of UK and overseas students and teachers is desirable, we are essentially training citizens of other countries to return and help those countries to prosper. In some ways the techniques used to recruit overseas students differs little from those applied to attracting foreign companies – location (outstanding natural environment), quality of workforce (skilled university lecturers), and community (friendliness of people). Unlike overseas-owned factories, however, which it is hoped will remain, most foreign students will leave after a few years or move to somewhere else in Britain and the EU, without leaving a significant footprint in Wales. A sudden change would clearly be very damaging but a gradual shift, through specifically-designed incentives, towards greater provision for students from Wales is desirable.[5]

The need to rescale and adapt to meet Welsh needs, is nowhere more apparent than in health, where Wales like the rest of advanced-economy Britain is incapable of providing enough medical staff, (GPs, junior doctors and consultants, nurses, physiotherapists, care workers and others) to look after the Welsh population. Instead, Britain strips the countries of Eastern Europe, and Africa and Asia of their doctors, nurses and other health professionals as if Zimbabwe, Thailand and Romania among others were selflessly training far more individuals than they needed themselves and could afford to export medical professionals!

Wales could carve out a new approach for itself by pledging to return our newer universities to (degree-giving) technical college status, concentrating on engineering, Information technology, management and other largely vocational courses. This could give Wales a head-start in the ambition (espoused by UK Governments of all stripes) to rebuild and re-energise Britain’s manufacturing sector. Do we need nine institutions styled universities for a population of 3m?

Fetishizing the idea that 50 per cent of the population should go to university, the UK (and Wales) has neglected the more than 50 per cent who currently do not. These are the very individuals for whom the jobs that used to exist in basic industries have disappeared over the past four decades. Policy should seek to support more effectively, and offer equal funding and treatment to, those who do not wish or do not have the aptitude to go to university, but who, just as importantly, may want to live and work in the communities they were born into in Wales. These are the very people who, if neglected, will drift off to the far right, which will be seen, however implausibly, to have a greater understanding of their situation. Voters need to know there is a Welsh party that understands their needs, is firmly on their side and will act.

The aim throughout the education system, starting at school level, should be to create pathways across the whole range of economic and political activities so that the most talented are offered a career in Wales. Our national game, rugby, offers lessons. Most of those who play with distinction for Wales are ordinary men from across (mainly) south Wales. They do not come from privileged backgrounds and they have not (with one or two exceptions) been imported. Most have not been to university.

The school system seems to work well here in filtering through and encouraging those with talent, and the WRU and the four Welsh regional sides are then able to take on talented youngsters and progress them through to cap level at various age grades. Some manage to prosper in this framework while still pursuing academic careers – Welsh players have simultaneously trained to become solicitors and doctors while still playing at the highest level. Even those who do not have a parallel professional route are in many cases able to develop after retirement from the game other Wales-based activities that use the training – hard work, discipline, mastery of technical detail – that comes from playing rugby at a high level.

Music offers a similar example, particularly for Welsh speakers. Schools have sadly cut back music provision but local, Urdd and National Eisteddfods provide a competitive environment that has enabled Welsh musicians and especially singers to succeed in music, both popular and classical. Both these sectors have created pathways so that anyone in Wales can rise to the top, not just in Wales but internationally. This makes both very different from other sectors where people trained in Wales to higher levels are usually only equipping themselves to move outside Wales. We even have programmes making it more likely the most able young people will leave Wales and not return, such as the efforts to get more talented students to apply for Oxbridge!

We have spent a long time tinkering with our education system which until several decades ago was functioning quite well. (It was capable, after all, of propelling a Welsh miner’s son from Aberdare into running the Large Hadron Collider at CERN in Geneva, and the son of Polish immigrants from Cardiff to Vice-Chancellor of Cambridge University.) We need to recognise that its failures, such as they are, stem at least in part from the feeling many of those put through it have that they will not find satisfying work at the end, especially if they are unlikely to attend university, and want to stay in Wales. This is at the root of the disaffection with school life of many young people, and especially boys in poorer communities. We should look to the two successful Welsh sectors mentioned above – rugby and music – to see if we can establish similar pathways so that individuals with aspirations in other areas can be channelled from school onwards in directions that will enable them to achieve their goals.

In summary, important as developing a battery of new proposals, Plaid needs to go further and establish itself as the party that is most attuned to what the needs of Wales are and is prepared to elaborate these, however, many sacred cows get slaughtered in the process. Policies need to be radical and daring, simple to enunciate and understand.

The above are just a few areas were radical approaches are needed. They must amount to more than the creation of a host of new institutions. A National Infrastructure Commission, a £2bn National Investment Bank, a National Energy Company, and a Metro Development Corporation may be part of the solution, but they are unlikely to raise more than a sceptical eyebrow across most parts of Wales. Even worse, they will appear just grandiose spending plans, with little of the outlay ever likely from experience to work its way down to meet the needs of the man on the Abercwmboi omnibus (if they still have one).

Plaid needs to show it understands the mood of the public as evidenced not just by Brexit, but by a general disillusionment with politics and politicians. There is no reason why Plaid should not have a whole range of the progressive policies favoured by elites in its locker. The Welsh public has after all been broadly accepting of the social and other changes of recent decades, even if most would be reluctant to stand in the rain in support of them. Let others be in the vanguard – and take the flak – for pushing further on the environment (Greens), minorities (Liberals) and claimants (Labour). These policies need not be the face of Plaid Cymru, which will lack a distinctive position in the political spectrum if it champions others’ causes and neglects its own. Plaid has a broader cause to support – Wales and its communities.

A new more nativist approach should be at the heart of Plaid’s offer. There is no contradiction, after the gains made in other areas affecting individuals over recent years, in saying a stronger focus is now needed on community rights – the right to a decent job in one’s own environment, the right to a decent public realm, the right to good transport and education.

Nor need it imply any lesser commitment to the internationalism that has been a feature of Plaid thinking since its earliest days. Wales’s credentials in this area, from the support for the League of Nations through to partnership with Lesotho are strong in any case and not under threat. Welsh people are unlikely to want to offer any less support to people in other nations in future – standing up for one’s own society does not mean neglecting one’s duty to others.

Indeed, if Wales is to play a fuller part in addressing international needs, it must build a stronger economy at home, using all the tools at its disposal. The strong presence the Irish have built up in international organisations and especially world charitable activity is illustrative as well as admirable. That has followed, rather than preceded the establishment of a strong, confident Irish economy, built on the foundations of decades of Ireland-first polices.

 

 

 

Rhys David

27th January 2019

 

 

 

 

 

 

 

[1] Nativism is defined here as a preference for putting one’s own country’s interests ahead of internationalism, as represented by globalism, unrestricted immigration and universal human rights. Those holding this view do not entirely reject these trends and processes but would argue they have been placed too far ahead of domestic considerations by an often-unelected elite who stand to benefit most from their adoption.

[2] Even in the US, support for the idea that democracy is the best form of government has been falling.

[3] The Creation of a Wales Transport Authority, the South Wales Metro (when delivered), the re-opening of passenger services (Llantwit Major, Ebbw Vale), the proposed new Cardiff Parkway station; Welsh income tax provision, Land Transaction Tax, eschewal of PPI contracts. In the social sphere, Commissioners for Old People, Well-Being of Future Generations etc, recycling rates, plastic bag tax, separate health service structure.

[4] German state railways

[5] This could be done through h student fee system.

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