EMPLOYMENT GOES DOWN IN WALES

Last week, some business organisations predicted that the economic downturn was ending and that the UK economy was set to recover by 2010, although the majority of economists remain convinced that unemployment will continue to rise beyond three million by the end of this year.

During this doom and gloom, casual reading of the latest jobless statistics would suggest that Wales has bucked the trend. Last month, the latest data showed that, in contrast to the rest of the UK, unemployment actually fell in Wales for the period April-June 2009.

Naturally, this was instantly seized on by some politicians as evidence that the economic policies pursued by the Assembly Government were paying dividends as compared to the rest of the UK.

However, if we examine the statistics in detail, there may be a very different story emerging.

Let’s take, for example, the case of unemployment, which is officially defined as “those without a job, want a job, have actively sought work in the last four weeks and are available to start work in the next two weeks or who are out of work, have found a job and are waiting to start it in the next two weeks”.

In Wales, unemployment fell by 2,000 to 107,000 people out of work which is still 37,000 more than a year ago but a welcome change in the previous trend.

In such circumstances, if unemployment went down, you would then naturally expect for those in employment to increase as people move from looking for a job to actually starting one. However, during the same period, the actual number in employment actually went down by 10,000 in Wales.

The question is what has happened to these workers? Have they left Wales and registered for unemployment elsewhere in the UK and therefore do not show up on the statistics? Alternatively, have they moved directly to becoming what the statisticians call “economically inactive”, that is, “those who want a job but have not been seeking work in the last four weeks, those who want a job and are seeking work but not available to start work, and those who do not want a job”?

This seems the most logical answer as the number of economically inactive in Wales went up by 17,000 during the same period as unemployment went down, although this is a strange result as one would naturally expect those who had lost their jobs to be looking for work unless, of course, they felt this was a largely pointless exercise during the current economic recession when it has been estimated that there are 100 people going for every job vacancy.

What is worth pointing out that these statistics do not measure the actual level of employment or unemployment and are merely extrapolations from a sample of respondents to the Labour Force Survey (LFS).

Indeed, statisticians are at pains to point out that the quarterly changes for Wales are subject to a larger sampling variability than for the UK as a whole. Given this, it is interesting to note that, in contrast to LFS unemployment, the number of those registering for Jobseekers Allowance in Wales continues to rise and is 35% higher than a year ago.

One of the reasons put forward for this reduction in unemployment is that Wales, despite the denials of Welsh Ministers at the time, probably entered the recession sooner than the rest of the UK.

Indeed, in the period April to June 2008 alone, there were thousands of redundancies announced by a range of large manufacturers including 3M (185 jobs), Corus Llanelli (300 jobs), Fenmarc (190 jobs), Kimball (160 jobs), Flexsys (163 jobs), Paramount Foods (150 jobs) and AB Electronics (157 jobs).

Others have suggested that unemployment is going down because initiatives such as ProAct are playing a vital role in keeping people in jobs, although the fact that employment itself has declined during the past three months weakens this argument.

Even if we look positively at the job data, our economy has some way to go before it recovers, especially if we examine other indicators. For example, UK output has gone down 6% since 2008 – twice the depth of the recession in the early 1990s – and corporate tax receipts for July were down 38% as compared to last year.

More worryingly for Wales, the UK is also set to borrow £200 billion by April 2010, which will put enormous pressure on Government spending.

This will inevitably lead to job cuts in local and national government and will hit those regions, such as Wales, which depend most on the public sector.

With more than one in five of all Welsh households having no adults in work, the spectre of unemployment is one which will continue to haunt this recession and it is clear that, despite the rose-tinted views of some politicians, we are not yet out of the woods.

Rather than pretend everything is fine, I would hope the Assembly Government will increase its efforts to ensure that the private sector is fully supported in creating jobs in the next few months. Only then will we finally see unemployment begin to fall in Wales.

CONSERVATIVES (43%) LABOUR (26%) LIB DEMS (17%)

The latest poll, this time in the Observer, shows that the Conservatives are maintaining a healthy lead over Labour.

Ironically, whilst an increasing number of people believe that the UK is merging from recession, this is not benefiting the incumbent at No 10, who is getting blamed for getting us into the mess in the first place. This mirrors the 1997 election when John major's Government, despite improvements in the UK's economic fortunes, lost heavily.

So what would such a poll mean for Wales if a general election was held immediately? As it is the silly season for another week, I put the latest poll through Martin Baxter's electoral calculus. The results were:

Conservatives 16 seats (+13)

Labour 16 seats (-13)

Plaid Cymru 5 seats (+2)

Liberal Democrats 2 seats (-2)

Independent 1 seat (no change)

That would be a seismic shift in the politics of Wales with even safe Labour seats such as Newport East changing hands.

Whether that will happen depends, of course, on a variety of factors including voter turnout by Labour, hardwork on the ground by local Conservatives and the status of the incumbent MP (e.g. Lembit Opik).

Still, with the general election only nine months away, we don't have long to wait.

BLAIR, LIBYA AND LABOUR

The Daily Mirror has just published a story which alleges that Tony Blair did a deal with Libya that allowed for the return of the Lockerbie bomber in exchange for trade and oil.

It would seem that despite attempts by the UK Government to say little on the affair, this is whole issue is going to run and run and that it may be the final straw that breaks this Government.

As a Times article indicates, there remain a number of unanswered questions including:

• What were the precise terms of the agreement that Britain reached with the US and Libya in 1999 that those convicted of the Lockerbie bombing would serve out their sentences in Scotland?


• Just what did Tony Blair say to Colonel Muammar Gaddafi when they met in 2004 and again, in the Libyan leader’s tent, in 2007?


• Exactly what was going on inside the heads of British and Scottish government ministers during the fraught negotiations in recent months over the fate of Abdul Baset Ali al-Megrahi?

To those I would add the following:

• Did Gordon Brown know the details of any deals brokered by Tony Blair with Libya?


• Has Peter Mandelson had any recent discussions with UK oil companies over Libyan investment ?


• Did the Prime Minister inform either the US Ambassador or the US President that the decision to free Abdul Baset Ali al-Megrahi was imminent?

This whole affair is becoming murkier by the minute and the fact that Libya's Sovereign Fund has decided to open offices in London in a deal allegdly brokered by Lord Mandelson raises even more questions about the UK Government's role and their willingness to jeopardise our diplomatic relationship with one of our staunchest allies for a couple of oil contracts.

215,000 WELSH PENSIONERS HAVE UNSECURED DEBTS

It would seem that the recent credit crunch has not only hit those in work.

According to a survey by Scottish Widows

• Around 34% of retired people have unsecured debts, owing an average of £7,344 each, according to Scottish Widows.
• The amount people owe is 9% higher than it was when the same research was done last year, and it has soared by nearly a quarter since 2007.
• A further 15% of retired people have an outstanding mortgage on which they owe just over £50,000, £8,000 more than the average pensioner owed in 2008.

As noted yesterday, Wales has more retired people than the average for the UK - 21.4 per cent are of retirement age in Wales as compared to 19.2 per cent for the UK.

If we simply compare this to the Scottish Widows data to Wales, this would mean that over 215,000 pensioners have unsecured debts. In addition, nearly 100,000 have an outstanding mortgage.

Of course, we would need to see a detailed regional breakdown of the Scottish Widows data to be accurate but such a figure, which represents around 10 per cent of the adult population, shows how deep the debt problem is within Wales, even amongst those who should have paid off their mortagges by now.

THE POPULATION OF WALES

The latest population estimates for Wales have just been released by the Welsh Assembly Government.

The min headline from the data is that the number of people living in wales continues to grow Wales - in June 2008, there were 2,993,400 people resident in Wales. This is an increase of 13,500 on mid-2007. Given this increase, it is likely that we have already passed the 3 million mark for the population of Wales, although this won't be confirmed officially until next year

Interestingly, there was little change in the broad age structure of the population compared to 2007, although Wales continues to have more retired people than the average for the UK - 21.4 per cent are of retirement age (639,400 people) in Wales as compared to 19.2 per cent for the UK.

Given that I have been invited to discuss the Barnett formula with the Holtham review next month, it will interesting to find out whether such considerations are made in the allocation of any funding for social services and health from central government.

Finally, the number of children aged under 5 in Wales increased by 2.8 per cent between mid-2007 and mid-2008, and all local authorities saw an increase. This will clearly have an impact on the provision of educational services within Wales and some critics of school closures may argue that they are premature.

The latest data hasn't been posted on statwales yet, but it will be worth seeing if there is anything else that comes out from the data at a spatial level, such as any 'brain drain effects' from rural to urban counties.

Airbus - grant verses loans

If the UK Government is lending Airbus £340 million through a repayable loan, why on earth did the Welsh Assembly Government have to give out £28 million in a cash grant as well?

Surely, the £28 million - which represents around 10 per cent of WAG's total business support fund - could easily have been added to the loan amount given out by Lord Mandelson's department?

This money could then have been used to support other businesses directly or given to an organisation such as Finance Wales to ensure that loans are made available to Welsh SMEs at a time when they need it the most.

Could WAG have done more to help young people get to university?

Last Thursday saw celebrations in schools and colleges up and down the country as 98 per cent of students in Wales passed their A-levels, with a quarter being awarded the highest grade.

However, many of those who just failed to get the grades they require may face disappointment over the next few days with 135,000 students fighting for 22,000 spare places through the clearing system.

In Wales, Aberystwyth University has already closed its doors to new students and a number of others are likely to follow over the next few days.

Of course, such competition could not come at a worse time for those who do not have the required grades. The recession has meant that there are very few jobs available, even for those who have qualified from higher education.

For example, BT – normally a major employer for university leavers – yesterday suspended its graduate recruitment activity and is no longer running a graduate recruitment programme.

Many other large companies are set to follow this lead as they struggle to cut costs during the current economic downturn.

According to official statistics, the current recession has hit young people the hardest of any working age group. It has been estimated that the unemployment rate amongst 16-24 year olds is quickly approaching 20 per cent, almost two and half times the rate for the rest of the population, and looks set to get worse during the next few months.

Of course, politicians will continue to argue that they are doing their best but is this really the case in Wales?

As many of you know, Wales is in receipt of nearly £1.9 billion of European Structural Funding, a competitive advantage that other parts of the UK - with the exception of Cornwall – do not have.

More significantly, the European Social Fund - the programme for supporting training and education - has a specific priority for funding programmes which can supply young people with the skills needed for learning and future employment.

This priority has been allocated £144 million of European grant, of which only £35 million has been committed to projects.

Therefore, there is an unbelievable £109 million currently available to directly support young people living within the poorest areas of Wales, which include Gwynedd, Anglesey, Denbighshire and Conwy.

I know that ministers have sometimes been accused of moving with all the urgency of a sleeping snail but with young people in Wales facing an increasingly uncertain future, but why couldn’t the Welsh Assembly Government have made some of this money available immediately to increase the number of places in universities and colleges across the nation?

Indeed, the First Minister is fond of boasting that the ProAct scheme to help companies was put through in a record time and, consequently, millions of pounds of European funding has been made available for training within a few months.

If that is the case for ProAct, then why couldn’t civil servants and politicians have done the same to help those young people who are facing an uncertain future if they can’t get a university place or a job and, like thousands of others, will end up on the dole?

The fact is that those in power have taken their eye off the ball and, as a result, thousands of young people in Wales could be consigned to the scrapheap of unemployment.

However, it is not too late and if the Assembly Government were to act quickly, it could pledge to use this funding to make thousands of extra places available for Welsh students next year and ensure that, during the worst recession of recent times, that we are using all the funds at our disposal to make sure that our young people have access to a brighter future.

Update 0900: BBC Wales have just revealed that HEFCW have announced budget cuts for next year, something which this blog predicted on August 8th. This means that even less Welsh students will be going to university next year.

Universities and industry - has anything really changed in eleven years?

Whilst clearing out some old files from the computer this afternoon, I came across this article from the Times Higher Education Supplement, which reported on the first major project which I managed - a £500,000 European Commission sponsored study into links between universities and industry.

It was a very proud moment for me personally and professionally, as only eight per cent of well over a thousand research proposals from all across Europe were actually funded.

Apart from making me feel very old and wondering where the last eleven years had gone, I still feel that entrepreneurship and links with industry are still not as valued by universities as research and teaching.

Until they are, our academic sector will continue to underperform in terms of its potential contribution to the economic vitality of this country.

'Enterprise must be valued and fostered'
THES, 13 November 1998

University enterprise is being stifled by more teaching duties, growing administrative tasks and the pursuit of high research ratings, a report will say. The European Commission-funded report, due to be published before Christmas, says that there is a mismatch between academic and industrial culture. A clear example is that pure academic research must be entered early for inclusion in research assessment exercises. By contrast industry often wants to sit on research findings for years to optimise their commercial potential.

The report, Universities, Technology Transfer and Spin-off Activities, also says that although most academics in the United Kingdom are entrepreneurial, often taking on contract research and consultancy work, universities offer little support for furthering such links with industry.

Study coordinator Dylan Jones-Evans, professor of entrepreneurship and small business management at Glamorgan University's Welsh Enterprise Institute, believes university and business culture must change. He says that enterprise should be seen as important as teaching and research. He welcomed last week's government announcement of £25 million to set up enterprise institutes in eight universities, but he said it did not go far enough.

Professor Jones-Evans said: "It is important that every university has the opportunity to develop an enterprise strategy. But increased teaching and administrative pressures mean that many staff simply do not have the time to properly establish and undertake collaborative projects with industry. In addition, the continued emphasis on publications as the traditional outputs for academic work has meant that collaborative industrial research and development is not valued, except as a source of income."

University-industry links were studied in five European countries and Wales and Northern Ireland, but not England and Scotland. It looked at the work of more than 4,500 academics in faculties of science, engineering and medicine. There are 30 case studies of academic entrepreneurs.

The report found that about 70 per cent of academic respondents had some type of industry contact in the past five years, mainly contract research and consulting. Professor Jones-Evans said these were just as much a part of entrepreneurial culture as the creation of "campus companies" but that the links with industry ought to be improved.

The Conservatives and the Welsh Blogosphere

Iain Dale’s annual listing of Welsh blogs is welcome in that it shows where there is political activity on the blogosphere and by which party. Whilst Conservative blogs seem to do well across the UK, the same cannot be said of Wales.

Congrats to Cardiff Blogger, the top-rated “Conservative” blog in Wales. I hate to admit that I haven’t been a regular visitor to this site but it will go on the blogroll later this week.

However, apart from the usual suspects such as David Jones, Glyn Davies and yours truly, there was no other Conservative presence in the top 30. Perhaps I should have voted!

More seriously, such a weak presence is unacceptable, especially as little seems to have changed since last year, when I commented that the Welsh Conservative Party really has to do more regarding its presence on the Welsh blogosphere, although this evidence from Mr Dale shows that the call has fallen on stony ground, especially amongst the vast majority of the three MPs, twelve Assembly Members and the 174 local councillors which make up the Conservative Party within Wales.

Maybe I should be making more effort on behalf of the party to drum up support for a proper Conservative web presence in Wales but I do have a full time job, two newspaper columns to write every week and a new business that I am developing, never mind two young sons!

We'll see.

In the meantime, I repeat what I said last year

“Many will say that they don't have the time to do this but we are all busy people and one of our hardest working shadow ministers, David Jones MP, makes the effort to blog nearly every day.

Others will say that there is nothing to write about, so why do I get at least ten press releases every day from the Welsh party? Some have told me that it is a waste of time because the blogosphere is not read by locals i.e. voters and yet blogs such as Oscar's Thoughts in Conwy are regularly commented upon by local Tories.

More importantly, the press - both local and national - will do regular trawls of blogs to look for new stories. It is time for every councillor, candidate, AM and MP to reconsider their presence on the web in Wales.

David Cameron has led the way with innovations such as webcameron and I would argue that, at a UK level, we are the best advocate of the use of the web as a communications tool and there is no reason not to do the same in Wales.

C'mon, Welsh Conservatives, we can do better than this!”

Defending International Business Wales

Last month, the Welsh Liberal Democrats accused the Assembly Government of a ‘culture of shocking spending excess’ when a Freedom of Information request showed that credit card bills totaling more than £700,000 were run up by officials of International Business Wales (IBW), the Assembly’s overseas investment arm whose role is to attract business into Wales as well as increasing the country’s exports and promoting Welsh business abroad.

This shows a complete lack of understanding by politicians over the costs of working overseas, as these businesspeople have clearly suggested in the Western Mail last week.

In possibly the worst environment for getting inward investment projects into Wales, IBW is punching well above its weight. This is at a time when we are facing the worst recession since the Second World War.

In particular, the team based in North America is doing a fantastic job in promoting Wales in the run up to the Ryder Cup in 2010.

Only recently, IBW arranged the largest ever trade mission to the USA which resulted in 80 businesses being given access to opportunities that will, over time, bring millions of pounds into the Welsh economy.

Its work has resulted in companies across Wales gaining access to markets that will lead to Welsh products and services being sold across the world and, consequently, the creation of much needed new jobs back home.

Rather than getting on with their main job, which is to increase the prosperity of Wales, IBW staff are now faced with a range of internal inquiries and audits which is a direct result of the Liberal Democrats’ fuss over the cost of travel and subsistence, which they claimed was exorbitant.

What did the politicians expect?

IBW staff are dealing with executives from some of the top companies in the world. Did Assembly Members expect staff to fly across the USA in economy and then take those executives out for a MacDonald’s? It demonstrates a level of naivety about the world of business investment that beggars belief.

Do politicians, many of whose record on expenses leaves much to be desired, actually think that flying across the world on business for your country is a holiday? Don’t they realise that when officials get to their destination, they don’t have the luxury of two weeks on the beach to get over their jetlag and that they will have to walk straight into a meeting. In many cases, they are competing against other countries which have no problems at all in ensuring that they fully support their own inward investment operations?

When you are pitching Wales against larger and better resourced countries, it is critical to give a professional image of our nation and its businesses to secure inward investment and export deals. No one in their right mind would want an IBW official to arrive jetlagged and distracted when pitching for projects that are worth millions to the Welsh economy.

Having been on trade missions with the IBW team, I have nothing but admiration for their professionalism and hard work. They are doing their best for the Welsh economy at what is a difficult time for any development body and I am confident that they will bring in investments that will create hundreds of well paid jobs over the coming months.

To have Welsh politicians question their integrity in doing their jobs undermines all the hard work they have undertaken on behalf of this country.

Worst of all, it sends a message to the rest of the world that Wales is shut for business and that we simply do not want to put in the effort and investment to bring their companies and jobs to this country.

Are Welsh Universities facing cuts? - an update

Just over a week ago, I wrote about some of the financial problems that Welsh Universities could be facing in the current economic climate.

When I put pen to paper, little did I know that the Times Higher Education was about to publish a stark warning that "institutions could be facing financial ruin unles they make radical changes to the way they work".

In an article headed "Storm warning:change now or perish institutions told", the academics' trade journal warned that there may be up to 30 institutions facing a deficit this year and that a number could close.

The question that the Welsh Press and Welsh politicians have yet to ask, of course, is whether any Welsh universities are in such a precarious financial position and, more importantly, what effect this could have on the delivery of higher education in Wales?

Further Education in Wales

Last week, I wrote about the importance of higher education to the Welsh economy.

However, it must be remembered that the main providers of post 16 education in Wales are not universities, but further education colleges.

Currently, twenty five further education colleges and institutions offer 80 per cent of all post-16 qualifications in Wales, with nearly 300,000 learners undertaking courses every year. Unlike universities, the majority of learners in further education are studying part-time, with many also working within businesses whilst studying for a qualification.

More importantly, the quality of learning within Welsh Further Education colleges is consistently shown to be far higher than that for colleges in England, giving Wales a real advantage in the provision of skills and learning to the business community.

Given the vital role of the further education sector in ensuring that the economy continues to develop the skills necessary to take it out of recession, it is disappointing that, for some strange reason, the Welsh Assembly Government has not adequately funded the sector.

For example, in January, fourteen further education colleges received news that their funding allocation was to be cut by £7 million, and it was only after protests outside the Assembly Building in April that this decision was effectively reversed and an additional £9 million was provided for the sector.

However, this increase meant that there was essentially no overall investment in those colleges which faced cuts in January despite the fact that this was a time when further education was needed more than ever to provide the training necessary to not only get people back to work, but to maintain the skills necessary for a competitive economy. Indeed, the additional amount will just about cover the pay increase of 2.3 per cent which the Assembly Government has instructed colleges to pay its staff.

In the face of this financial uncertainty, a number of further education colleges have been forced to make cuts in courses and jobs at a time when they can ill afford to. For example, Pembrokeshire College announced that it is cutting 9,555 hours from its course provision in 2009-10, whilst Bridgend College has cut all its full time A-level courses from September. In addition, Gorseinon College in Swansea is cutting adult learner courses, Yale College in Wrexham is ending some A-level and Learndirect courses, and Barry College has extended its overtime ban on staff, held vacancies and delayed replacing staff.

One would have thought that during a period when youth unemployment is at its highest for nearly twenty years, policymakers would make it an absolute priority to ensure that young people in Wales are not abandoned during the worst recession since the Second World War. Indeed, they should be making every effort possible to make sure that those aged between 16 and 24 are given the skills that will be needed by Welsh employers in the future.

Rather than consigning young people to the scrapheap of economic inactivity, we should be ensuring that real funding is provided for further education colleges to develop the next generation of skilled workers with industry relevant qualifications that can make a real difference to the Welsh economy.

Of course, the conundrum is whether, under the current declining state of public finances, we can afford to spend the money on skills? The simple answer is that we cannot afford not to and our nation’s workforce should not be left behind when the recession ends.

The irony of this situation is that whilst the rest of the UK is suffering from public sector cuts, there have been substantial amounts of additional funding available from European Structural Funds for the last two and a half years. Despite the fact that 40 per cent of this £2 billion fund has been earmarked for skills development, there has yet to be any substantial project awarded to support the further education sector in Wales. With a little more strategic thinking, many of the financial problems that the sector is facing could have been avoided by using European funding to support many of the industry-oriented courses that further education colleges offer.

Politicians are fond of using statements such as “the Learning Country” to describe the Welsh nation but whilst such rhetoric may play well in Cardiff Bay, it would seem to many that education is simply not perceived as a high enough priority in developing the competitive advantage of this nation. That is a real tragedy as a properly funded post 16 education sector could provide a real difference to the Welsh economy, especially if there were closing working relationships between higher and further education.

A former President of Harvard University once said that “If you think education is expensive, try ignorance”. In the post-recessionary world of the next decade, it will be those nations that invest in skills and education that will stand out and succeed.

In Wales, universities and colleges need to be supported properly to provide the skills that will enable our industries to compete with the best in the world. If that means that we need to divert more money from other budgets - such as business development or transport - to ensure that this happens, then that may well be the bitter pill we need to swallow to ensure that Wales has the skilled workforce necessary to become a truly competitive economy.

Information Literacy and the Digital Divide

As the old saying goes, information is power, and as the world becomes a smaller place with the advent of the internet age, those with access to that information are in pole position for a better life.

This view is clearly supported by Welsh MPs who recently concluded that access to super fast broadband technology in Wales would be a key factor in the future economic growth of the nation.

In particular, the report from the Welsh Affairs Select Committee highlighted the problem of areas with limited or no access to high-speed internet connections.

Of course, the economy of North Wales has recently been given a boost in this direction by the announcement of the £30 million fibre network across a dozen or so business parks, although the real test of its success is whether it can branch out from the main 200 mile route along the A55 into the more rural areas of Wales.

It is not only infrastructure which is important in bridging the so-called ‘digital divide’. Dr Hywel Francis, Chairman of the Select Committee, stated that proper thought should also be given to addressing specific issues such as the Welsh language.

Whilst such considerations are rightly important, a more pressing problem the inability of many of those within our poorest communities to access the information they need to conduct their daily lives from the internet.

As a result of this lack of information literacy, some of the most vulnerable groups in Wales are becoming even more excluded from modern society, yet it remains an area which has yet to be properly addressed by policymakers. This is despite overwhelming evidence that the growing gap between those who are "information rich" and "information poor" within our society has the potential to create significant social and economic problems in the future.

Certainly, there is little evidence that information literacy forms a part of any initiative to support the educational and training needs of those within our more deprived communities. Indeed, as government services, educational resources and information move online, those who have not been adequately trained to access such services become increasingly excluded and increasingly financially disadvantaged if they cannot access support.

Yet the importance of information and a clear strategy to ensure its dissemination to the wider community is being ignored even by those who should know better.

This is exemplified by the case of Bangor University which, for the first time in its 125 year history, no longer has a University Librarian but instead has chosen to merge the role with that of the Director of Information Services. This follows the institution’s decision to get rid of the majority of its professional librarians in 2005.

It may be that senior university managers considered librarians to be superfluous with the advent of search engines such as Google. However, as many of the very best universities in the World can attest, librarians remain a vital human interface with users and provide guidance to accessing the right information.

Indeed, if individuals are not supported properly in how to use search engines such as Google effectively, then it becomes a completely useless tool that may, worryingly and potentially dangerously, provide wrong and misleading information.

Certainly if one of our oldest academic institutions can act in such an ill-informed way, what sort of signal does that send out about information literacy to other organisations across North Wales?

The report by the Welsh Affairs Select Committee is a welcome first step but if we are to create a truly digital society, we must not only build a world class broadband network in Wales but also give everyone the skills to access it properly.

If not, it is like buying a seventeen year old a Ferrari without paying for the driving lessons first.

Are Welsh Universities facing cuts?

Having, for once, avoided any contact with academia during my fortnight’s holiday in Portugal, I seem to have returned to a situation where the UK university sector could be on the brink of turmoil.

For example, one particular story in the Times Higher Education – the academics’ trade journal - indicated that university Vice Chancellors in England were ‘thinking the unthinkable’ and modelling 20 per cent budget reductions for the next financial year given the likely cuts in public sector expenditure after the 2010 general election.

Given that the sector in England receives around £8 billion every year, this would amount to an eye watering reduction of around £1.6 billion which would decimate the sector at a time when it is needed the most to help the economy recover from recession.

Of course, this may just be scaremongering by the heads of some academic institutions, although one vice chancellor was quoted as stating that they are building in reductions ranging from a minimum of five per cent to a maximum of twenty per cent in next year’s budget.

As expected, this level of cuts has been denied by HEFCE - the higher education funding council for England. Instead, they have been working on the basis that the university sector’s funding will be cut by £180 million from 2009-10 to 2010-11.

Whichever group is right – the universities or the funding council, it is clear that English universities will face some difficult and largely unpalatable decisions during the next twelve months.

So what about the situation in Wales?

Welsh universities are funded separately to England and, according to the latest budget announcement by the Higher Education Funding Council for Wales, will receive around £434 million for 2009-2010, which is equivalent to 2.9 per cent of the Assembly’s total budget.

It is therefore surprising that given the noise emanating from English universities there has been almost no public discussion of the potential impact of government cuts on the higher education sector in Wales after the next election.

Indeed, if we assume the best case scenario of HEFCE’s estimates of cuts in England, this would equate to a reduction of around £9 million in the Welsh higher education budget, or around 150-200 full time lecturing posts.

However, if we start looking at the level of cuts estimated by English Vice Chancellors, then reduction in Welsh university funding could range from £22 million (5 per cent cut) to £87 million (20 per cent cut).

This raises serious issues over the future of the sector during the next few years.

For example, if the Assembly Government decides to impose such cuts on Welsh universities following a reduction in the block grant from Westminster, how can higher education then provide any additional resource to make a continuing contribution to the economic recovery of the nation during the current recession?

More importantly, how the sector play a full and constructive role in important regeneration projects such as European Convergence Funds if there is little spare cash available for match funding projects, even through in-kind support?

Will universities continue to close departments which senior management consider as peripheral to their strategy, as we have recently seen with the highly controversial loss of jobs at the Centre for Lifelong Learning at Cardiff University?

Will some institutions be forced to abandon large scale infrastructure projects such as the second campus project at Swansea University or the new Arts and Innovation Centre at Bangor University?

Finally, will the precarious financial position of some Welsh universities actually mean that some will end up being forced to merge or, in the worst case scenario, close their doors?

These are all critical strategic questions for the future of Welsh universities which are currently being largely ignored or denied by politicians and policymakers.

Whilst the sector may be an easy target for future expenditure cuts, we mustn’t forget that in a small country such as Wales - which has the lowest level of private sector R&D expenditure of any region in the UK - the importance of the university sector in creating a competitive and innovative nation cannot be underestimated. Not only are they critical sources of research and innovation but they are also vital local employers and significant contributors to the communities in which they are based.

Can anyone possibly imagine Wales without these centres of learning?

How vibrant would our capital city be without the presence of Cardiff University and UWIC? Where would the much needed regeneration of the City of Newport be without its university? Which other well paid jobs would be provided in rural Wales in the absence of the Universities of Aberystwyth and Trinity St-David’s?

With the UK government aiming to borrow £175 billion by April 2010, there are clearly going to be some serious decisions to be made over government expenditure over the next few years.

However, given the critical role of universities within Wales, we can only hope that our political parties will step up to the plate and continue to support higher education in Wales and its ability to make a real difference to our economy.

Wales: a view from the past

Hat to tip to David Jones.

The US Library of Congress has just released a photostream of images of Wales from the late 19th and early 20th century - the slideshow of the images has been embedded in the blog above.

The images demonstrate perfectly the historical legacy, the natural beauty and the industrial heritage of Wales - just look at those showing the ships on the quay at Caernarfon. That remains an amazing image of the importance of the town during the late 19th century.

These photos brought back some poignant memories as one of my collector's fads when I was younger and had more time was collecting postcards of Wales from the same period.

I have hundreds of these cards stored somewhere in the attic back in Pwllheli - it may be time to get them out again.

More bad news for the Welsh economy

According to the Centre for Economics and Business Research, those regions with high level of public expenditure as share of GDP may be de-coupled from economic recovery as the government has to rebalance its books.

In their latest analysis - which was largely ignored by the Welsh press - the economic consultancy group predicted that whilst the Welsh economy may be partially cushioned this year because of its high dependency on the public sector, the medium term prospects are somewhat different.

With forecasted cuts of £80 billion to ensure that the UK’s public sector finances are balanced, those regions that are most reliant on public spending which will suffer the most. According to the CEBR, two thirds of our national prosperity is dependent on the public sector.

Whilst regions such as London will grow by 1.1 per cent during 2010-2013, Wales is forecasted to grow by only 0.7 per cent over the same period.

Perhaps more telling is CEBR’s advice that only a concerted effort to promote entrepreneurship and support private sector growth can prevent Wales from falling further behind the more prosperous parts of the United Kingdom.

Shame therefore that this particular Assembly Government has cut funding for economic development, created one of the most bureucratic business support systems in the UK, refused to re-establish the Entrepreneurship Action Plan for Wales and pushed out the private sector from any real involvement within European Structural Funds of nearly £2 billion.

Petty cash, teas and Welsh MPs

According to the Sunday Times, sixty MPs received up to £12,000 each over four years in “no questions asked” petty cash payments from the House of Commons authorities without without having to submit a single receipt.

Two Welsh MPs are prominently feautured in this list, namely Labour's Wayne David - who claimed £12,000 over the period 2004-2008 and Hywel Williams of Plaid Cymru - who claimed £10,150 over the same period.

According to the current speaker, John Bercow,

"The money was solely for the provision of tea, coffees, soft drinks and so on within the Palace of Westminster for individuals or groups who came to petition me on some aspect of public policy".

Given that the MPs have access to highly subsidised canteen facilities at the House of Commons, then the fact that these two Welsh MPs have spent over £2500 each on teas and coffees seem strange in the extreme.

Given that the House of Commons only sits for around 30 weeks a year, that amounts to a weekly tea bill of around £80-£100 per week for both MPs during this period!

In addition, one would expect that MPs would be able to charge any expenditure within the House of Commons directly to their accounts and therefore would have noi need for petty cash?

I am sure there is perfectly rational explanation for this expenditure but as the Welsh press seems to have completely ignored this story, I doubt if we will get any further information on this issue.

The WDA

Having spent the last two weeks in sun-drenched Portugal sitting on the beach reading and relaxing, I haven’t been anywhere near the blogosphere or, for that matter, Welsh news.

Of course, I then had to leave my phone on last Wednesday whilst sitting by the pool and received a call from the highly talented David Williamson of the Western Mail, who wanted me to comment on a story they were running on an IWA article by Brian Morgan calling for the resurrection of the WDA.

My comments from David’s interview can be read here.

To be honest, I wasn’t surprised by the story itself, only that it has taken so long for this call to be made. Ironically, my column for yesterday’s Western Mail was on the same subject but was written two and a half weeks ago before I went away on holiday.

My view is pretty clear about this and is similar to that made by Dafydd Wigley, namely that we need to thoroughly investigate whether the current merger of the WDA into the Department for Economy and Transport has benefited the Welsh economy.

My own belief from bitter experience is that it has not and that the whole process of supporting business has become overly bureaucratic, directionless and focused solely on process rather than outcome.

Worst of all, the department seems to be worried more about what the Minister will think about any decision rather than the effect of any support on the businesses themselves.

That is not to say that we should just bring back the old WDA as it is easy to forget that it was beset by many problems, not least a silo mentality by many of the departments within the organisation which stifled its overall effectiveness. We mustn't also forget that the WDA, despite it best intentions, did not succeed in arresting Wales's economic decline relative to the rest of the UK during the last decade.

Therefore, any review should certainly re-examine the case for a separate economic development body away from the day to day interference of politicians and, more importantly, this should be based on best practice from other similar small economies. The question, of course, is whether such a review will actually take place in the near future?