For crying out loud, should any self respecting Welsh person really believe we should be in this position after a decade of devolution?
More relevantly, have any of them stopped to think why, despite spending the billions of pounds of European money over the last decade, the Welsh economy continues to go backwards?
The fact that the private sector, mainly for narrow ideological reasons, has been largely excluded from developing projects during the last two rounds of European Structural Fund projects is probably one of the key reasons why very little economic progress has been achieved during this time.
For example, one of the major investments during the Objective 1 period was the Technium programme and much has been written about the so-called "Fields of Dreams error" that was made in committing money to this scheme i.e. if you build it, they will come. I know because I have consistently been one of those critics of the way this project was developed.
Yet the simple fact of the matter is that if you let a red-tape obsessed Welsh Assembly Government run by civil servants with no commercial experience develop and manage an incubator unit, what do you think is going to happen?
The same applies to scores of other projects from business support to regeneration projects.
Rather than being seen as an investment to generate further wealth and jobs, European money has been merely been seen by public bodies as a bonus to their budgets with no real thought given as to whether that funding would generate long term sustainable growth.
More detailed discussion on this issue next week but, for the weekend, let me leave you with the following table, which shows which UK sub-regions have grown (or not grown) during the period 2000-2008 when West Wales and the Valleys received £1.3 billion of Objective 1 funding and a further £700 million of public matched funding.
As the table below shows, the relative prosperity of West Wales and the Valleys went down by -3.1% during this period, despite the fact that around £2 billion of European and public money was spent in the region.
Compare this to the performance of the other regions that were in receipt of European Objective 1 funding at the time and their performance. Cornwall increased its relative prosperity by 9.0%, South Yorkshire by 1.9% and Merseyside by 0.3%.
Can anyone try and explain why this is the case - that other regions in receipt of Objective 1 funding managed to grow their economies whilst it has declined in West Wales and the Valleys?
However, the real concern, and the one that Welsh politicians should really be worried about, is the fact that the prosperity of East Wales has declined by -5.2% over the same period.
In 2000, the region was almost at the same prosperity level as the UK economy. By 2008, it had declined to 94% of the UK's average prosperity. This is despite the so-called "devolution dividend", a doubling of the Assembly's budget and responsibility for economic development being firmly in the hands of our own Minister in Cardiff Bay.
Therefore, if the economic powerhouses of Cardiff, Wrexham and Flintshire are one of the five worst performing sub-regions of the UK, then the Welsh economy is in serious trouble.
More importantly, if anyone still thinks that the naive document that makes up the Economic Renewal Programme is the answer to this decline, then god help us.
Comments
Surely thats a 2% drop not 3.1%
I also note that "East Wales" significantly outperforms swathes of England and Scotland including Outer London and Greater Manchester despite the drop.
The first two figures are the relative prosperity of each region.
The third percentage figure is the percentage change in relative prosperity.
As for East Wales vs other areas, yes it does but for how much longer!
Is there a table for straight up GVA (for want of a better phrase- i'm no academic!) rather than just relative GVA? Then also with each year on the table, rather than just 2000 and 2008? On 2008's figures East Wales comes in at 11th in the UK 'league table'- West Wales & the Valleys comes in bottom.
Also, the full extent of Inner London's position is insane- almost 200 percentage points ahead of anywhere else in the UK.
You know, we can all play around with these statistics but, despite our differences, I would hope we both want Wales to succeed economically and it clearly isn't.
Earlier this week, I had lunch in London with a very successful ex-pat who said to me "You clearly have a lot of ideas and nobody seems to listen. Why do you stay in Wales when you could be working elsewhere". The answer, of course,is bleedingly obvious. I love this country and I don't want to be anywhere else.
BUT, you are right, London's position is insane and it is about time we did something about it. Any ideas?
With Wales having additional powers and Assembly funding as compared to these three other regions (didn't the IWA point out that Wales spent more on economic development than anywhere else), there really isn't any excuse.
I don't want to play around with the statistics- I think the way you have set them out (and i'm not attacking you personally here) is 'playing around' with them, because we closed the relative gap with the UK average GVA in 2009. That year was the only time we closed the gap since the 1980s. It happened by Wales getting poorer that year in absolute terms, and the UK on average getting even poorer than Wales. Because it was a recession year.
I am not suggesting Wales does not face huge economic problems and challenges, or that we are fulfilling our potential at all. But the relative GVA thing doesn't work to me if the only way it can be closed is during a recession.
If places like Buckinghamshire, much of the South-West, and Surry have fallen 'even further behind' (in relative terms) than West Wales and the Valleys then i'm not really sure how to even approach the issue. The GLA has economic development powers like Wales but parts of it have declined (relatively) even more than we have.
And on rectifying the way Inner London is so far ahead, I don't really have any ideas or solutions, I am not capable of answering that question without suggesting a solution that would be politically unacceptable to parties that are still wedded to neoliberalism.
What we should be looking at is long term trends
For example, if you examine relative GVA since 1999, you find that the Welsh economy has grown by 44% in the period 1999-2009, with only the West Midlands having a worse performance, mainly due to the catastrophic 15 % collapse of manufacturing over this period (the worst of any region).
In contrast, Wales grew by 58% during the period 1989-1999.
For those who are against the Assembly, that is real ammunition, especially as we had the bonus of the £4 billion of European funding (including the match for 2000-2007).
For pro-devolutionists like myself, it suggests that we have simply had the wrong policies in place. It may also mean that we simply cannot, with the limited powers we have, do anything to turn around the decline without a radical solution?
More analysis to come.