As Wales’ largest county, Powys has had some notable industrial successes throughout its history. It was the birthplace of Robert Owen, the creator of the co-operative movement and the location of the first mail order business in the world – Pryce Jones of Newtown. It is also where Laura Ashley, arguably one of Wales’ most famous entrepreneurs, chose to start her textile business in the 1960s which took Welsh fashion designs around the globe.
Given this business heritage, it is disappointing that, in terms of economic policy during the last decade, Powys has become very much the forgotten county of Wales.
For example, when Wales applied for European funding back in the late 1990s, Powys was omitted from the list of counties that was put together to make up the artificial region now known as West Wales and the Valleys.
As a result, not only did Powys then lose out on a share of the £1.2 billion of European funding made available to West Wales and the Valleys, but it also lost out on any assisted area status for the vast majority of the county with the notable exceptions of Machynlleth and Ystradgynlais.
This status is critical for companies wishing to expand their operations or for those inward investors looking to relocate as it means that a higher level of grant support can be given to a company setting up or expanding in an assisted area. As a result, maximum grant support of up to 50 per cent has been available within West Wales and the Valleys since 2000 whilst none has been forthcoming for any business wishing to relocate or expand within the majority of the county, including the main conurbations of Newtown and Welshpool.
The question, of course, is whether this failure to include Powys within the West Wales and the Valleys region has affected the Powys economy at all?
If we examine the economic data for the county, it does suggest that there has been a slowdown as compared to the rest of Wales.
For example, official data from the Office for National Statistics shows that Powys has now suffered a fall in economic prosperity (GVA/head) from 75.0 per cent of the UK average in 1999 to 66.1 per cent in 2007. This decline of 8.9 per cent compares with an overall fall in the prosperity per head of West Wales and the Valleys of only 1.9 per cent.
By the time the first round of Convergence funds via the Objective 1 programme was drawing to a close in 2007, the GVA/head in Powys in 2007 was £12,771 per head. In four of the counties receiving funding it was higher, namely Swansea, Gwynedd, Bridgend and Neath Port Talbot.
Indeed, whilst the economic prosperity of West Wales and the Valleys had grown by 41 per cent during the period 1999-2007, that of Powys had increased by only 29 per cent.
Given this, you have to ask the question why the Welsh Assembly Government (WAG) did not make a case for Powys to be included in the second round of European Structural Funding for the period 2007-2013, which has resulted in an additional £2 billion of funding for the West Wales and the Valleys region?
Why didn’t anyone within WAG stand up for Powys during this time, especially given the fact that it had been overtaken in economic prosperity by other counties which still qualified for funding? Would it have been too difficult to make a strong case for inclusion and therefore access to vital funding for economic development?
Assuming that Powys would have had its fair share of the two European funding programmes, this exclusion has meant that the county has lost out on around £200 million of additional financial support for the economy during the period 2000-2013.
One can only imagine what such investment would have done for its prosperity during this time.
If the Welsh economy continues to decline relative to the rest of Europe, then current estimates suggest that the fifteen counties that make up West Wales and the Valleys may well qualify for an unprecedented third time.
If that does happen, then there is certainly a case to be made for Powys to be included in this next round of European funding and therefore gain access to funding opportunities that could turn around the economic decline suffered by the county during the last decade.
Comments
That is a terrible indictment of economic development policy over the last decade. It also demonstrates that the support received from Europe and the assisted area status is critical for the poorer parts of this nation. It shows what happens without the grant and business support required to attract companies to those areas which need jobs. Wales has been hit hardest by the recession and isn't ready for an end to the grant culture. If this is what has happened in Powys, what will happen to the rest of the deprived areas of Wales if IWJ puts his faith in broadband and six sectors of the economy.
If you read the piece carefully, I didn't argue that Wales had lost out on £200 million (although that would be worth exploring again). I instead made the point that Powys has lost out on its (rightful?) share of the funds that Wales has received since 2000 and that nothing has been done to make up for that fact.
I have always been a strong believer that the majority of EC funds should be distributed locally and who is to say what Powys could have done with its share of the funding received under both programmes?
Your contention that WAG believed that European funding would come to an end in 2007 does not make up for the fact that no-one seemed to be on the ball over the declining economic position of Powys relative to the rest of Wales.
So much for spatial planning.
You know as well as I do that Wales would have received transitional funding over the period 2007-2013. My point is that Powys should rightfully have been included in any new geographical area because of its economic position. It certainly had a better case for inclusion than Swansea, for example.
However, regardless of any funding from Europe, the omission of Powys from having any type of assisted area status is probably the main issue, as companies within the region have not been eligible for financial support.
Given there was a review of assisted area status by the UK government in 2006, with a view to submitting a revised list of eligible areas to the European Commission, was a submission made by WAG to include Powys in this new map as the county would have had a very strong case for inclusion? Perhaps someone from WAG could provide the answer.
As for revisionism, who would have known what would have happened of Major’s government had won a second term in 1997?
Given the fact that the manufacturing actually increased in Wales during 1992-1997 and has declined by over 10 per cent of the Welsh economy since under successive Labour Governments, that would be a history worth rewriting.
That included people directly involved in Europe, economic development,community development and local authority management.
Powys problems come from its spatial issues relative to its budget.Its a patchwork and its needs are not cohesive.It needs some good strategic leadership,its not had that.
Powys has never taken full benefit of LEADER and the other rural European programmes. It needs some real support and under standing.
You could invite the entire working population of Powis to see Wales play rugby at the Millennium Stadium and still have tickets spare!
Whilst access to grants does help there are many other factors that will also be taken into account - good transport links, access to local suppliers, education, academia and of course people to name just a few.
In terms of basic deprivation indicators Powis just doesn't appear on the list so I am not sure how you can make a valid case for its inclusion.
Could it be that with grants, companies have no incentive to find real paying customers? With grants being available for a generation, isn't the outcome that a whole generation is unskilled in selling in these areas?
Why should anyone buy their goods? Because its made in the back of beyond and has a picture of a Dragon on it, isn't good enough!
At least the business people of Powys quickly learnt that to make some money, they need to do business with Birmingham. You might not have heard of this place, but its 80 miles away from Newtown, over the border in England.
so that is why the Powys economy has gone down the pan. Thanks for working that one out for us.
GVA/head measurement is the main indicator for measuring both assisted area status and qualification for structural funding so Powys should qualify.
As for rural poverty, Kirsty Williams pointed out today that "Rural Poverty and social exclusion "cannot be denied" according to a new report from 'Children in Wales'. The report's title "Families not areas suffer rural disadvantage" highlights the organisation's findings that pockets of deprivation are often hidden amongst more affluent areas in rural Wales. Interviewed agencies highlighted "problems accessing services, leisure opportunities and welfare advice" with "many families' problems…exacerbated by the lack of affordable transport and struggling on a low-income."
She also said that "This report confirms what those of us from rural Wales have constantly tried to impress upon the Assembly Government - that poverty is not restricted to the M4 corridor and does in fact extend to rural areas such as Powys. Areas of deprivation in rural areas may be more spread out and hidden behind idyllic landscape but poverty is still a very real issue. The study states that the unit cost of providing services in rural areas is higher than in urban areas and therefore the rural element of the Revenue Support Grant should be increased to reflect this. The report stresses the lack of resources and policy directed at the support of family and community in rural areas and is essential that the Assembly Government develops support that is specifically applicable to the rural context. The report calls for new indicators of relative poverty so as to include rural areas in WAG deprivation funding, along with longer term grants. Kirsty said: "We need investment in the local economy to encourage new businesses and job creation; we need investment in public transport so that those without car access are not left isolated; we need to retain our local health care services for a healthy population; we need affordable housing with more rural housing enablers and access to inexpensive childcare. (Wales Rural Observatory research shows that that the proportion of working households in rural Wales earning less than £10,000 in 2003 was identical to that in urban areas, at 20% and only slightly below the figure for the valleys (21%)).
Powys is a Liberal heartland and as others have said it was Labour that lobbied the hardest for European money that has been so badly misused and mismanaged by WAG.
Its also rich of Jeff Jones to talk about the strategic political failure in Powys which may be true but when his Party's Labour Councils in West Wales, the Valleys and North Wales have presided over some of the worst instances of cronyism and gerrymandering that did little for the communities they serve but managed to make many so called Socialist Councilors very rich indeed it looks rather hollow.
What a short memory you have, Jeff
As for the other anon with the comments about cronyism, gerrymandering and rich socialists .Thanks for the laugh. At least I'm prepared to put my name to any comment I make on any blog.