The Welsh economy is seriously underachieving. As economist, Gerry Holtham, has demonstrated, Wales’ public sector deficit, the difference between public expenditure and what is raised through taxes, is £12 billion, a quarter of Wales’ Gross Added Value (GVA). Wales’ average GVA is about 75 per cent of the UK average, and the ‘prosperity gap’ is at present widening rather than closing.
Compare this with Scotland where the deficit is no worse than that of the whole United Kingdom. As Gerry Holtham points out, the reasons for the difference are that Wales has neither its own oil field nor a sizeable financial services sector, and that taken overall its economy is not in a healthy competitive state.
As a result of these economic realities the positions of Wales and Scotland in constitutional debate over the future of Britain are totally different. Scotland can consider political independence, whether you think this desirable or not. The next option, fiscal autonomy or ‘Devo-max’, is also credible and a real possibility.
However, for Wales both these options are out of the question. Not only that, but a third option of giving the Assembly the kind of substantial taxation responsibilities known as ‘Devo-plus’, remains a considerable challenge. Wales would still be heavily dependent on financial transfers from the Westminster Treasury. In short, and depressingly, the weakness of our economy limits our national aspirations.
There are other serious effects of economic underachievement, including unemployment and economic inactivity, educational underachievement, and a range of health and social problems. In addition, and as serious as all of this, is the continuing haemorrhage of our best and brightest talents through emigration. In turn this is a drain on our social and cultural confidence and specifically on the vitality of the Welsh language.
The promotion of Sustainable Development is as we have all heard ad nauseam, a statutory obligation placed on the National Assembly through the 1998 and 2006 Government of Wales Acts. I played some part in the process of including this obligation in the 1998 Act, and am glad to be able to say so. However, from the standpoint of constitutional principle, it is wholly unacceptable that Westminster legislation places such an obligation (and there are others) on the National Assembly and I look forward to doing away with such obligations in a new Government of Wales Act as soon as possible.
The Welsh Government is committed to passing a Sustainable Development Act and a Bill to take this forward will be presented to the Assembly this October. It is opportune therefore, and at the risk of oversimplification to remind ourselves of the two rival visions of a future Wales set out in the iconic englyn of Taliesin o Eifion (Thomas Jones 1820-76):
‘Pure Wales, tranquil Wales – fair Wales
Wales beloved always
Fairest Wales, seize the day,
Land of song, advance and progress.’
Here we have two versions of Wales. In the first couplet there is a complacent, sentimental, picture of a pure, tranquil, beloved Wales. In the second, there is the alternative, a Wales which seizes the day and embraces progress, one of the key concepts of the Victorian age and the industrial revolution.
The concept of Wales as a beautiful, unspoilt landscape, a marvellous country for visitors to explore and discover its romantic, rocky primitive beauty is analysed in Peter Lord’s masterly volume Imaging the Nation. It was this version of Wales, and of so-called ‘North Wales’ in particular, which caused the UK government to designate 20 per cent of the land of Wales as national parks (note the adjective, and bear in mind that the nation is question is not Wales), and a further 10 per cent as Areas of Outstanding Natural Beauty. In both designations there are substantial limitations on development, including renewable energy, in the name of conserving the priceless landscape of pure Wales.
The rival version is to be found in the reality of the lives of the majority of the people in 19th century Wales, which turned them into an industrialised population in one of the most innovative and enterprising countries in the world. It was this spectacular transformation that gave rise to political and religious radicalism, social and cultural creativity and ferment. As a result, and unlike Ireland, we retained a high percentage of our migratory population within the boundaries of Wales which in turn injected new energy into the Welsh language. One by-product of this transformation was, of course, the ‘land of song’ invoked in Taliesin o Eifion’s englyn.
True, all this came at enormous human (although not nearly as bad as that suffered by rural Ireland) and environmental cost. It was a perfect example, you might say, of unsustainable development. And, in addition to injecting new life into the language, did it not also sow the seeds of its decline? But seriously, where would Wales be today were it not for what was forged in this amazing revolutionary cauldron?
When I walk in the countryside today, what never fails to entrance me, and what gives meaning to the landscape, is the human, social and cultural inheritance passed on by past generations. And so much of that priceless heritage is due to the development of industry. Is it not striking, and proper, that the industrial town of Blaenafon has gained UNESCO World Heritage Site status?
The other day, I stood on Banc y Darren in northern Ceredigion, above Trefeurig, Cwmerfin, Cwmsymlog and Penrhyncoch. The view was amazing,, while the ground under my feet was a maze of mine workings, lead, silver, and copper. The surrounding villages were as much industrial settlements as Blaenafon and Merthyr Tydfil, Glyn-neath and Tredegar or Llanberis or Rhosllannerchrugog. These were among the powerhouses of the cultural, social and national awakening which is responsible for the fact that Wales is today a political nation.
From Banc y Darren I could also see wind farms enlivening the view. Erecting and maintaining them has created jobs and is pumping tens of thousands of pounds a year into the surrounding areas. But these developments happened in the teeth of the fierce opposition from a minority of dedicated people. As often as not their opposition was articulated in terms of the romantic image of Wales as a priceless and unsullied landscape which must be preserved from development and radical change.
Yet when I stand at the summit of Pumlumon I see not destruction but the miracle of turning wind into electricity, the spinning of the blades enlivening the view, and the fascination that these depopulated, post-industrial areas are once again contributing to the economy and creating a new and valued product.
Concern for the preservation of a priceless landscape was what informed the Welsh Government planning decisions which led to the failure of the Cambrian Engineering Company which constructed wind turbine towers and employed 80 workers in Gwynedd. It was the same concern which meant that producing a planning framework for renewable energy was such a long-drawn-out, tortuous process, from which emerged the infamous TAN 8 planning document. One consequence of that is the ill-informed and negative protests in Powys today, before which the Welsh Government retreated with such alacrity.
When the sawmills at Newbridge on Wye, Powys developed a scheme to generate heat and energy from waste wood and conifers, increasingly difficult to exploit because of the increased recycling of paper, one of the objections listed by the Environment Agency was that a rising column of steam from the works – steam, not fire or smoke – would sully the view. In the face of planning objections the scheme, which could have helped kick start a Welsh biomass industry, was withdrawn.
At a recent conference on renewable energy a constant refrain by the companies present was the difficulty of carrying on their business, and thus competing and producing profit, in Wales. The contrast with Scotland was mentioned repeatedly. There the installed capacity for renewable energy has risen from 1,800MW in 2004 to 4,360 in 2010 – an increase of 242 per cent. The corresponding figures for Wales were 429 and 764, an increase of 56 per cent. Wales had a target of reaching 4TWh for renewable energy by 2010, but only achieved 1.6TWh.
The Scottish Government has certain powers which the Welsh Government lacks, and which have enabled Scotland to innovate in tidal and wave technology as well as wind. However, this has as much to do with political will as with powers. And part of the problem is Version 1 Wales – pure Wales, tranquil Wales, the sacred landscape which must be kept inviolate. The irony is that strict environmental regulation often prevents precisely the type of development which is essential for a sustainable natural environment.
However, we also need to consider our attitude towards economic development that is not sustainable in the full sense. The evidence suggests that Wales’s reserves of shale gas along with methane from the extensive coal seams remaining under land and sea, for example in Swansea Bay, are substantial. Carbon emissions from gas are less than from coal and oil, but they hardly fit a true definition of sustainable development. If these sources were intelligently developed and set within the framework of other policies such as workforce development and creating Welsh supply chains, might it be that Wales’ natural gas reserves could have a transformational effect on our economic fortunes not unlike that of North Sea oil in Scotland? Would it make any kind of sense for Wales to reject this opportunity in the name of sustainability or in keeping with the pure, tranquil Wales mind set.
Wales then should interpret its national commitment to promoting sustainable development rather by what we do than by what we don’t do. We should regard sustainable development as an opportunity to surge ahead rather than as a series of hurdles to be surmounted before we can act. Rather than adopting the role of well-behaved ecologists we should be pushing the boundaries of invention and innovation, eager to grasp the opportunities when they arise. If that is environmental heresy, it is also simple common sense for a small nation whose collective environmental global footprint is tiny, and whose need of economic transformation is profound.
So we come at last to the proposed Sustainable Development Act. Part of the background is the Sustainable Development Charter which according to the Welsh Government “sets our vision for a sustainable Wales”,. Sustainable development, described as “the central organising principle” of the government’s policies, has the following elements:
- Living within our environmental means, using only our fair share of the earth’s resources.
- Supporting healthy, productive and biological ecosystems.
- Building a sustainable and strong economy, and fostering local economies and suppliers.
- Enjoying safe, sustainable and attractive communities.
- Creating a fair, just and bilingual country.
Wales’s environmental footprint heads the list. However if we were to succeed in closing the prosperity gap between Wales and the rest of the UK, an increase in our environmental footprint would be a well-nigh inevitable consequence. Improving our primitive road network, for example within Wales and between north and south, would in all probability increase our carbon emissions, unless we produce new sustainable fuels – and Wales is not likely to manage that on its own.
WWF and other environmental organisations complain that the Welsh Government’s legislative proposals place insufficient emphasis on reducing our global ecological footprint. Here is an excellent example of transferring a UK policy automatically to the Welsh context, with no attempt to think creatively about the specific problems and priorities of Wales. In this mind set the economy comes third and not first.
What, therefore, should be the foundations of the new Sustainable Development Act? In other words, what kind of Wales do we wish to see? Here are two options. The first is to commit to our present route:
- Emphasise environmental conservation and living within global limits.
- Develop a range of locally-based enterprises which conform strictly to the sustainable development template and gain brownie points from environmentalists and within the UN Network of Regions for Sustainable Development.
- Reject economic growth as a key consideration.
- Accept Wales’ dependence on fiscal transfers from Westminster, with all w that implies for our constitutional aspirations.
Or we can be much more ambitious:
- Use sustainable development as an engine for improving economic performance and creating a new industrial revolution in Wales.
- Accept the need for compromise in conserving the environment, particularly the visual landscape.
- Over time to wean ourselves off our dependence on the UK Treasury.
- Keep our constitutional options open according to what is advantageous for Wales.
I favour the second option, and recommend the following underpinning principles for the proposed Sustainable Development Act:
- Target and support environmental sectors which can contribute to economic growth.
- Create a planning and regulatory framework which will facilitate and accelerate the sector’s development.
- Develop and sustain our environmental assets, including water and energy, for the economic benefit of the nation.
- Establish a hierarchy of considerations which will rank climate change, biodiversity and control of pollution higher than considerations of (subjective) visual aesthetics.
- Develop expertise in predicting and analysing international and European policy trends so as to help set the direction for our economic development.
- Ensure that Welsh businesses are aware of and informed about these trends and are thus able to take advantage of them.
- Ensure that understanding sustainablity is a key element in the curriculum at all levels, so as to create a nation well-versed in the field.
- Accept that the well-being of the natural environment must be placed in the context of the necessity of improving Wales’s economic performance.
- Set per capita GVA and economic growth within a wider framework of sustainable development indicators.
- Do everything possible to ensure that the result of economic success is strongly linked to social justice and community regeneration.
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