Opinion

It’s the economy, stupid – why praise on handling the pandemic might not secure Drakeford a Senedd election win

27 Mar 2021 5 minutes Read
Mark Drakeford the First Minister of Wales. Picture by the Welsh Government

Keith Darlington

In a recent Nation.Cymru article Ifan Morgan Jones posed the question, “How do we explain the paradox at the heart of the latest Wales YouGov poll?”.

In his article, he tries to explain the paradox between the high ratings given to Mark Drakeford for his handling of the pandemic, with the polls that show that Labour is facing big losses in the 2021 Senedd elections.

He concludes that the Tories are gaining at the expense of UKIP who have now returned to the fold.  Whilst I broadly agree with his analysis, another important factor for the voters may be concern for who will best manage the Welsh economy after the pandemic is over.

A similar paradox occurred in the 1945 General Election. This election followed the ending of World War 2 when Winston Churchill was basking in the afterglow of victory. His position seemed unassailable going into the election and virtually nobody predicted the eventual result: he lost very badly.

Labour’s Clem Atlee won a landslide majority – that included a huge proportion of support from the British troops stationed overseas. This was a complete surprise.  One of the main reasons attributed to this result was that, whilst voters held Churchill in high esteem, they do not judge their leaders on the past but what they are likely to offer them in the future.

In 1945, Labour were offering radical change – particularly on the economy with a program that included economic planning, full employment, and nationalisation.  Churchill’s Conservative party were, by contrast, seen as offering little change. After the austerity of the war years, voters wanted a party that offered a different kind of future.

In the same way, Drakeford has been seen as a safe pair of hands in handling the pandemic in Wales. His personal ratings are high. But many jobs are under threat because of the pandemic and when life returns to normal, voters will want to know who can provide job security for them.

They will want to know whether Drakeford’s Welsh Labour, who has held the levers of power in Wales since the birth of the Senedd, has the vision to renew the Welsh economy.

Job losses

The combination of an economy on its knees from the pandemic and Brexit will pose huge challenges for all parties – something that could loom large in the minds of the voters. For, in recent years, Wales has seen many job losses – including the highly skilled workforce at the Ford Engine plant in Bridgend in 2020.

Furthermore, on Wednesday 10th March, it was announced that Aston Martin were making almost 200 people redundant at its St Athan plant. The Unite Cymru union say it raises questions regarding their commitment to south Wales, describing the cuts as a “huge chunk of the total workforce”.

This was another blow for Welsh workers because the company has secured more than £19 million in support from the Welsh government. Whilst accepting that the company has been hit hard with lower sales as a result of Covid, it should be said that the plant has only been in operation since 2018.

Foreign investment

From the 1980s, the Welsh economy has thrived on jobs created through inward foreign investment. The loss of traditional industrial jobs in south Wales were slowly being compensated by this approach to economic management.

During the years between 1979 and 1991, it accounted for over 14% of the UK total investment, despite the population of Wales being less than 5% of the UK population. Wales was one of the top-performing areas of the UK for attracting inward investment. The country benefited from this employment as more traditional industries declined

However, by 2009, Wales had become one of the worst-performing areas of the UK and much of the economic benefit of earlier investment had disappeared. The fall of the Berlin Wall, the rise of China, and the enlargement of the EU meant that manufacturing consumer goods was becoming more competitive abroad.

With Wales no longer able to compete on cost, it was inevitable that these companies would up-sticks eventually. In Bridgend alone, many large foreign firms have come and gone, such as Sony, LG, Bosch – and more recently the Ford engine plant which employed over 1700 people.

Another problem, according to one of the UK Parliamentary publications, was that many of the jobs provided in the 1980s and 1990s had been low-paid assembly-line work and had not improved the long-term skills of the employees.

Dr John Ball, Lecturer in Economics at Swansea University, argued at the time, that policies had concentrated on the provision of employment to the detriment of self-sustaining growth: “it was employment at any price”.

He also said, Wales became a “branch plant” economy; inward investment became synonymous with external ownership, low skilled employment, standard end of life cycle products, mature technologies and restricted management opportunities.

Future

With large energy projects recently scrapped such as the £1.3bn Swansea tidal lagoon project and the cancelled £16bn nuclear power station on Anglesey the time has surely come for the parties to realize the importance of the economy in this election.

One of Bill Clinton’s aides once coined the phrase “it’s the economy stupid”. This phrase could also be very apt for the forthcoming Senedd elections.

Recently, Adam Price stated that the Welsh Government must provide more support for the Welsh hospitality and leisure industry and small businesses to assist progressive reopening after the pandemic.

But he will need to offer more and emphasis the differences between his plans and that of Labour’s on the economy.

Success for Plaid, and other parties, could well hinge on what sort of economic future they can offer for a post-pandemic Wales.

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