For Britain See Wales: Five principles for a future Wales

Joe England

“For twenty years we’ve pretended we know what we’re doing on the economy – and the truth is we don’t really know what we’re doing on the economy. Nobody knows what they are doing on the economy… Everybody is making it up as we go along… we need to try a different approach” Lee Waters

This uninhibited comment by a Welsh Government minister raised eyebrows yet it was true that for more than two decades Wales had had the lowest Gross Value Added (GVA) per head of any region or country in the UK.

Behind Waters’ frank statement lay the fact that industrialisation has been about shareholder value and not about Abertillery, Blaenafon, the Rhondda, Gwauncaegurwen or Blaenau Ffestiniog.

When the mines, factories and quarries have gone and the roller coaster is back at the bottom, these are not places where footloose factories are likely to settle. They can choose anywhere in the world.

What is needed is focused local action. The umbilical link between the local economy and the local community that existed for over 200 years has seemingly been broken.

Can that link be re-established?

Former industries

The former industries no longer exist but in the Valleys and throughout Wales the components of life as we know it – the essential infrastructure of our civilisation – water, food, energy, houses, health, roads and railways, internet connections, schools and colleges, childcare, retail banking, local shops and services, the cables, pipes and networks that connect us to services, are still there.

To these, increased leisure has added libraries, open spaces and parks.

The providers of these necessary services exist all around us: shop assistants and stackers of shelves, care workers, cleaners, doctors and nurses, local builders and market-stall holders, lorry and bus drivers, teachers and postmen, librarians and bank clerks.

They are the people who make life possible, sometimes literally possible. In Wales these jobs are more than 40 per cent of total employment.

The goods and services they provide are essential to the local population. Yet until Covid-19 these local services and their workers were taken for granted. We were blinded by the neo-liberal argument that the value of these goods and services was decided in the marketplace.

The pandemic taught that life matters more than wealth. Those who do the essential jobs are essential.

Investing in Communities

These are unconventional principles. They emphasise building from the bottom up rather than relying upon imported businesses. They recognise the significance of social rather than individual consumption of goods and services.

Support Local Businesses

Wherever possible, local councils, hospitals, colleges, universities and businesses should sign contracts with local suppliers and by this means increase local jobs, retain wealth locally and shorten supply chains.

Goods and services produced by local people strengthen social relationships and boost local incomes.

There is considerable scope for action. Professor Dylan Jones-Evans has noted that ‘the 22 local authorities in Wales have a revenue expenditure of £8bn (excluding debt financing costs) and £1.5bn in capital expenditure’. At present there is no evidence how much is spent in Wales.

Although ‘construction contracts with a total value of£1.94bn have been awarded to Welsh public bodies since 2015, only 17.1 per cent of the total value was awarded to firms with a Welsh-registered address.’ (Western Mail, 8 February 2020).

The Federation of Small Businesses confirms that for every £1 local authorities spend on goods and services with local small and medium-sized employers, an additional 63p is generated for the local economy.

Buying from local providers boosts local development. Around 48 per cent of NHS Wales’ £22m food budget is spent outside Wales. Wherever possible, it should be replaced by local spending, retaining income in Wales and supporting local and regional economies.

Fair employment

End the low pay and insecurity of those who provide essential services: the carers, porters, cleaners, refuse workers, those who carry and deliver.

These are tasks with social and economic meaning, although it took the pandemic to demonstrate their essential nature. Social care is the seventh largest employment sector in Wales contributing £2.2bn to the Welsh economy.

A first step, where they are employed by the state or local councils, is to pay the Living Wage to those workers who do not receive it.

Where training would be necessary or helpful, it should be provided. Parts of the social care sector in Wales have a 30 per cent annual turnover of the workforce, which is both extremely costly and bad for the quality of service.

Where these services are under-staffed, an increase in the number of jobs would support local employment and increase local spending.

Develop local ownership

Encourage locally owned businesses, whether privately owned, employee owned, or in municipal ownership.

Rents are low in most of Wales compared with city locations. Build relationships between local businesses so that the income of these businesses circulates locally instead of going to distant shareholders.

A sub-group of the Valleys Taskforce encouraged small and medium-sized firms to take forward this approach but also to explore opportunities for export business. One of the prime weaknesses of Wales’ industrial structure is that too few small businesses grow to medium-sized or even into large businesses.

Local use of land

Develop and extend community management and use of public sector land and facilities. Much of the land in Wales is owned by the Forestry Commission, local author-ities, the Coal Authority, and the Senedd.

Community management could lead to energy generation, food growing and commercial forestry. The businesses and the income derived would boost the local community. There is a view that winding up the Land Authority for Wales, which was consolidating ownerships to public benefit, was a mistake and that it should be brought back.

Circulate and invest local wealth

Encourage and increase investment from local sources of investment such as credit unions, local authority pension funds, and mutually owned building societies such as the Swansea, Principality, or Monmouthshire societies, so that the wealth that exists in the locality is circulated and the need for outside capital is reduced.

Joe England was educated at Cyfarthfa Grammar School, Merthyr Tydfil and at the University of Nottingham where he studied Economic and Social History.

He has enjoyed a distinguished career in Higher Education. He has published several books including a critically acclaimed biography of place, Merthyr: The Crucible of Modern Wales.

His new book For Britain See Wales A Possible Future is out now.