PROFESSOR DYLAN JONES-EVANS

Last week, I put forward the case that the Welsh Assembly Government was conveniently ignoring the job creating potential of the European Structural Programme. Not surprisingly, this is an issue that also seems to have been conveniently ignored by the mainstream press in Wales as they continue their message of doom and gloom for the Welsh economy. I have rewritten the blog entry for my column in the Western Mail today so we will see if there is any further reaction, especially from politicians. I have also decided to carry out an exercise which is hardly scientific but does suggest that there is scope for job creation across different parts of Wales if the European Convergence programme is applied proportionally. The table below shows how many jobs could be created across the poorest counties of Wales if the remaining target of 32,000 jobs were applied proportionally according to the adult labour force in each county, which is as good a measure as any. Of course, it is highly...

This evening, the 12th Wales Fast Growth 50 gala dinner will take place at the Holland House Hotel in Cardiff. With a full house of 442 guests, made up of the firms and the award sponsors only, we will be celebrating the best of Welsh business in an atmosphere that is very different to your standard business dinner. Last year's winning company, Unit Construction and Engineers, has already announced a major project in the last few months  and it was great to see that another previous FG50 company, Moneypenny, has recently stated that it will be creating an additional 100 jobs in Wrexham. So which company will win this evening? Well, I am afraid the result is not officially announced until the 52 page Western Mail supplement on Wednesday but I can reveal is that all fifty companies have made an incredible contribution to the Welsh economy both in terms of employment and increased sales during the worst recession since the 1920s. More relevantly (and WAG policymakers take no...

An article in the Independent on Sunday makes a fascinating observation about one of the key sectors expected to grow during the next few years. According to the paper , "Leading the way is the food and drink manufacturing sector, which employs nearly 440,000 people and invests more than £1.1 billion a year on research and development – comparable to the automotive sector". "The Food and Drink Federation said that over the next seven to 10 years the industry needed to hire 137,000 new recruits. Angela Coleshill, FDF's human resources director, said of that total, 45,000 people are needed to fill higher-skills roles such as senior management and technical positions. The sector's population is ageing and, in the next seven to 10 years, around one-fifth will retire," she said. "Our big challenge is replicating this knowledge and people." The total number of apprenticeships in the sector had doubled in the past 12 months to 2,500, she added, but...

As this blog has been pointing out over the last few days, the UK economy seems to be in better shape than many had predicted. According to the Office for National Statistics , Gross Domestic Product (GDP) increased 0.8 per cent in the third quarter of 2010, compared with an increase of 1.2 per cent in the previous quarter. Whilst some (notably the BBC) have tried to spin this as decrease, the ONS rightly point out that allowing for the recovery in Q2 following the bad weather at the start of the year, the underlying growth in Q3 is broadly similar to that in Q2. More importantly, it would seem that growth is taking place across the entire economy. For example, services output rose 0.6 per cent in the third quarter, compared with a rise of 0.6 per cent in the previous quarter.  Total production output rose 0.6 per cent in the third quarter of 2010, compared with an increase of 1.0 per cent in the second quarter. Finally, construction output rose 4.0 per cent in ...

During the CBI conference yesterday,   the UK Government announced a £200m scheme to create a network of elite Technology and Innovation Centres. The centres will bridge the gap between universities and businesses, helping to commercialise the outputs of Britain’s world-class research base. According to Business Secretary Vince Cable, the centres will  allow companies to access cutting-edge technologies that would otherwise be beyond their reach and take ideas from the drawing board to the market place. They will play a key role in helping firms develop new products and processes so they can grow and prosper. More importantly, no decision has yet been taken as to where the centres could be based but a spokesman for the Department for Business, Innovation and Skills confirmed that locations in Wales had not been ruled out. Given this, I fully expect the Welsh Assembly Government to start making the case now to Vince Cable to get him to locate a number of these...

Ed Milliband, in a speech to the CBI yesterday, made the following statement: "Despite all the talent in engineering and work in our universities, I fear Britain still suffers from an anti-manufacturing bias. The way to support British businesses who want to lead in the industries of the future isn’t for government to do nothing. Government action can make a difference, and government inaction can make life harder". As the new Labour leader is in his honeymoon period, but did anyone bother telling him that between 1997 and 2007, manufacturing as a proportion of national wealth reduced from 20.7 per cent of the UK economy to 12.7 per cent. In Wales, it went from 27.6 per cent of the economy in 1997 to 17.6 per cent of the economy in 2007. Is that what he meant by government action to support manufacturing? It is also worth noting, and something that the Labour Party finds hard to deal with, that the contribution of manufacturing to the economy under John Major'...

In the midst of all of the doom and gloom from the commentariat and the odd Nobel economist, it was fascinating to read yesterday’s piece from the Telegraph’s editor Philip Aldrick which spelt out clearly what many have simply ignored, namely that the private sector is ready to grow the UK economy. Please take the opportunity to read the full article, but some of the main debating points are as follows: At the end of last year, UK businesses were sitting on a £65 billion cash surplus – the difference between profits and capital expenditure – and are on course to replicate that in 2010. By comparison, in the early 1990s, corporates were on their knees. Once more certainty is achieved, corporates will want to do something with all that money and the UK could be on “the cusp of the mother of all investment booms here." The Budget delivered businesses £7bn of tax cuts – shifting the burden of the net £8bn tax increase on to banks through the new levy and on to shoppers through hi...

32,000 JOBS STILL TO BE CREATED BY EU PROGRAMMES IN WALES There have been various questions raised during the last two weeks whether the private sector can compensate for the loss in public sector jobs. Certainly businesses are giving it a good go – the latest figures on employment growth in the private sector show that businesses in the UK have already created an additional 308,000 jobs between March and June 2010. However, another 650,000 jobs need to be created to get the private sector back to the record 23.76 million employed by business in March 2008. If 450,000 jobs are cut within the public sector, this will be equivalent to a reduction of 7.4 per cent. This will take public sector employment back to the levels of employment last seen in March 2003. Indeed, public sector employment will still be around 250,000 higher than it was when Labour won their second term back in May 2001. To compensate, the private sector has to grow by only 1.9 per cent (and it grew by 1.3 pe...

Is the Welsh Assembly Government, aided by the mainstream press in Wales, in danger of giving Wales a victim mentality? The constant moaning that is prevalent amongst Ministers in Wales, fuelled by Welsh journalists and broadcasters, may play well amongst the party faithful in the run-up to the Assembly election but is it the image we wish to portray to the rest of the World? It is clear from various opinion polls that the public accepts that there has to be a reduction in government expenditure and, more relevantly, that the last Labour Government is responsible for the financial mess that we are currently in. Indeed, the indications are that Wales would have received the same level of cuts even if Labour had been in power. Perhaps what worries Carwyn Jones and the rest of the government is that whilst they were planning for cuts of £500 million every year until 2014-15, they will instead have to find savings of £500m over the next four years in total. The UK Government ha...

Yet another interesting omission yesterday by the mainstream press regarding the defence review and its effect in Wales. While much of the focus was on St Athan, the UK Government also made the decision to upgrade the air transport fleet with A400M and A330 aircraft, replacing the Tristar and VC-10 from 2013. So what effect will this have on Wales and the Airbus plant in Broughton? Well, according to Mark Tami, Labour MP for Alyn and Deeside , thousands of Flintshire jobs could have been put in jeopardy if the Government had backed out of the contract as Mr Tami feared that the scrapping of the agreement could put future projects at risk. In addition, the Flintshire Chronicle  reported that, according to  Mr Tami, “The A400M is the best product for our armed forces and for the British taxpayer. It will help ensure the UK aerospace sector has a strong and purposeful future. The Government should do what is right for Britain and back the contract.” Can we there...

Without the BBC, one would seriously wonder where the news output in Wales would be, given the cutbacks across the rest of the Welsh media. The high level of professionalism and quality within BBC Wales puts many other regions of the UK to shame. However, during the last few weeks in the run-up to the Comprehensive Spending Review, I know that some have questioned the “impartiality” of  the BBC when it comes to reporting the decisions to be made by the UK Government. Perhaps one day, some eager politics student will undertake a doctoral dissertation to examine, in detail, the view expressed by reporters and commentators on our publicly funded TV channel since May of this year. In the meantime, such criticisms are not helped by examples such as the report on today’s BBC Wales online news on the rail electrification which does stretch the balanced view many of us have come to expect from the BBC. According to the report , “Plans to electrify the Great Western Main Line - ...

Last week, the National Assembly's Enterprise and Learning committee investigation concluded the 16-24 year old NEETs (Not in Employment, education or training) were being "failed" by the system. According to their report, Wales has a higher proportion of Neets than anywhere else in the UK and the committee noted that "it is deeply worrying that so many of our young people are still being failed by the system." Predictably, the Welsh Assembly Government dismisses this findings by stating that it has invested £49m into training and education for NEETs. However, is that money actually reaching its intended recipients? One of the main sources of funding for programmes to support young people is European Convergence Funding. Indeed, there is an entire European Social Fund measure that is dedicated to “supplying young people with the skills needed for learning and future employment”. According to the Welsh European Funding Office , £108 million of European...

Not surprisingly, there have been an enormous amount of stories in the press during the last couple of weeks in the lead up to the Comprehensive Spending Review. I will be appearing with Eurfyl ap Gwilym on the Politics Show later this morning and I am sure we will have an interesting discussion. However, what has interested me, as someone on the periphery of politics these days, is the sheer hypocrisy shown by members of the Labour Party during the last few weeks. You would have thought from all the tweets, facebook entries and press commentary that the Labour Party is completely innocent in all of this and they, of course, would never have envisaged any type of cuts. Well perhaps it is time to remind the Labour Party, and some of their friends in the press, of what the last Chancellor of the Exchequer said earlier this year after his March budget. For example, a report from the BBC noted the following : "Experts say Mr Darling has postponed the major decisions on depa...

It would seem that Chris Huhne is about to announce that Anglesey is to be the site of a new nuclear power station, creating around 5,000 construction jobs with a further 1,000 people employed in the operation of the station. According to the Telegraph last night "The list of areas earmarked for power stations to be built by 2025, according to sources close to the Department for Energy and Climate Change (DECC) is: Bradwell in Essex, Hartlepool in County Durham, Heysham 2 in Lancashire, Hinkley Point in Somerset, Oldbury in South Gloucestershire, Sellafield in Cumbria, Sizewell C in Suffolk and Wylfa Head on Anglesey". As I have said before, this could mean that there is a great opportunity for Wales to become a real centre of expertise in this sector, and it is now up to the Welsh Assembly Government to ensure that European Structural Funding can be used effectively to help build up value added projects for the new power station. For example, helping to create an energ...

In their election manifesto, the Conservatives pledged to begin work immediately to create a high speed rail line connecting London and Heathrow with Birmingham, Manchester and Leeds as a first step towards creating a national high speed rail network to join up major cities across England, Scotland and Wales. The second stage would involve the delivery of two further new lines bringing the North East, Scotland and Wales into the high-speed rail network. On Wednesday, we will find out whether this will actually happen. However, let me nail my colours to the mast immediately. In my opinion, if the UK Government is to build a high speed rail link, then it should start with the Great Western line from London to the West of the country, including Wales. Why should this be the case? Is this blind patriotism on my behalf? Well, only in one eye. As the Conservative Bow Group suggested earlier this year , Brunel’s superbly engineered Great Western line could and should take prior...

“We need a radical overhaul of higher education in Wales so institutions see their primary function as serving Wales and its students". Ffred Ffransis in the Western Mail today.

As promised, some thoughts on the Hugh James Exchange debate from last night. Apologies for not doing it sooner but I left the house at 6am this morning for a trip to North Wales and have only just arrived back. Overall, it was an interesting evening and many thanks to Hugh James for inviting me. My one and only complaint was the format, which meant that it was not so much a debate as a speech, followed by question and answer session with very little time for the panelists to put any views across in any real detail. Of course, that did not apply to the Deputy First Minister, who was given around fifteen minutes to set out his stall for the ERP and then the rest of us were given one minute to respond. We were then peppered with questions from the audience on a range of matters. It did get quite heated on occasion as the Minister continued to try and toe the party line about all 190,000 firms in Wales would benefit from his policy of high speed broadband as opposed to the 10,00...

Later tonight, I am taking part in the Hugh James Exchange event, "Economic Renewal: the right direction?". The keynote speaker is Deputy First Minister, Ieuan Wyn Jones AM and I am one of the three panelists which also include David Davies of Axiom Manufacturing and David Stevens of Admiral Insurance. I am really looking forward for the opportunity to finally discuss the Economic Renewal Programme, especially as I have just come into possession of a document that, to put it bluntly, is dynamite. Will report back later.

Some startling, if not wholly surprising, results from the BBC study examining which parts of Wales are most resilient to any spending cuts. Data from Experian research undertaken for the BBC suggests that the south Wales valleys of Rhondda Cynon Taf, Caerphilly, Merthyr Tydfil and Blaenau Gwent were among the least resilient in Wales. Whilst the point of the BBC study is clearly focused towards the potential effects of the Comprehensive Spending Review, I wonder whether anyone will actually ask the most obvious question of all, namely does this not demonstrate the failure of the Welsh Assembly Government to make any real inroads into the issues facing our poorest communities? After three Labour led Assembly Governments, an Assembly budget that has nearly doubled since 1999, and two tranches of European funding worth over £3.2 billion, there seems to have been no real progress in terms of developing a sustainable economy within the South Wales Valleys. Of course, the knee ...

Two major events this week, namely Philip Green’s review of government spending and Lord Browne’s long awaited review of university fees. With regard to Lord Browne’s review, which has been heavily trailed in the press, the former BP chief executive is expected to propose a lift in the cap on tuition fees to around £7,000 a year, with the possibility of some universities charging more for certain courses. This of course, only applies to England, as higher education is a devolved issue and the question for Leighton Andrews, the Minister for Education, is whether Wales will also adopt the recommendations or whether he will take a very different view of how to fund the university sector in Wales. I am sure some in Wales will try and make political capital out of this but it is worth noting that the Browne Review was set up initially by the last Labour Government so it can hardly be called a Tory plot to increase tuition fees. One can only hope that we can have a mature debate on thi...

In just over three weeks’ time, the twelfth annual Fast Growth 50 list will appear in the Western Mail. It will celebrate, yet again, the best of Welsh entrepreneurship at a time when the economy needs it the most. Yet, surprisingly, there continues to be some doubts expressed within the Welsh business community as to whether the development of fast growth businesses in Wales should be supported by the business and policy community. Certainly, such an opinion runs contrary to much of the evidence which demonstrates the critical role of such companies, in terms of employment creation, innovation and exporting performance, to regional and national economies all over the World. Let us first examine the job creating impact of fast growth firms. A recent detailed economic analysis of employment change amongst SMEs showed that whilst fast growth companies represented only 6 per cent of all UK firms employing ten or more people, they accounted for more than half the job growth in ...

According to the BBC, no Welsh MPs have made it into Labour's shadow cabinet. "Peter Hain, MP for Neath, Rhondda MP Chris Bryant and Cardiff West MP Kevin Brennan were notable omissions. Sources within the Welsh party said they expected Mr Hain to be among the five choices left to the discretion of Labour leader Ed Miliband. Mr Miliband has confirmed that there will be a shadow Welsh Secretary in his shadow cabinet and that the post will be held by a Welsh MP. Eight Welsh MPs put their names forward for the shadow cabinet, including Wayne David, David Hanson, Huw Irranca-Davies, Ian Lucas and Alun Michael. Sources close to Mr Hain said he was disappointed not to make the shadow cabinet but always knew it was a possibility given the number of candidates." So much for loyalty but if you can dump your own brother without any hesitation, then dumping one of your most prominent supporters is clearly no problem.

This week saw a growing disconnectivity between the narrative by most of the political press and the opinions of the rest of the country. If you had just listened to the TV news or read most of the printed press during the last few days of the Conservative conference, you would have thought that the decision to cut child benefit for higher earners was possibly the single biggest political mistake since the poll tax and, as a result, the Conservative Party was in meltdown. Yet, a poll for YouGov on Monday night found 83 per cent of voters back Chancellor George Osborne's announcement that child benefit will not be paid to parents to earn more than £44,000 a year from 2013. Another 86 per cent of respondents agreed with introducing a £500 a week limit to the benefits unemployed families can claim. In addition, YouGov found that whilst 20 per cent felt that the Coalition Government were to blame for the cuts in public spending, 44 per cent were blaming the last Labour government...

It would seem that I have touched a raw nerve with some members of the CBI. One of their senior members, Rudi Plaut, has written a riposte to my recent article questioning their stance on the lack of support for small firms.  However, his main critique seems to be that we should stop support to small firms because the process it too bureaucratic. As he notes “The article equates the money budgeted for business support as actually going to businesses to help them. Unfortunately, that is not the case. A high proportion of the £30m goes into the overheads and salaries of the grant giving departments and never reaches business. Time and time again SMEs are promised money which then takes months longer than expected to reach a decision. In the meantime, the application has involved large amounts of management time in completing forms and answering questions, often the same ones several times over.” Therefore, why doesn't the CBI support a streamlining and simpl...

With the Welsh Assembly Government (WAG) looking to abandon business support for the majority of small businesses and channel the money towards a £240 million super broadband system, there have been questions asked about whether this is the right strategy, especially as the cost looks prohibitively high for an infrastructure that many simply will not use. Indeed, it is has been suggested that having civil servants sitting cosily around a table with large telecommunications companies may not be the best way to assess the cost of broadband, especially to rural areas, and there may be cheaper options available. Last month, this column noted the case of Erbistock near Wrexham, which had been quoted a price of £550,000 from BT to install broadband across the village and had then been offered a similar solution, by a small company, Rutland Telecom, for a tenth of the price . Well, it would seem that the publicity following this case has forced the telecommunications giant into finding ...