IWA Eisteddfod Lecture – EU funding: Wales’ latest dependency culture?

The 2013 IWA Eisteddfod lecture delivered by Guto Bebb, MP for Conwy

You can view the lecture in Welsh here ; and read it in Welsh here


This is my third appearance at various meetings during this particular Eisteddfod and so far it appears that every such appearance has involved my viewpoints on European issues, be it a question-time style panel in the FUW tent or a slightly esoteric annual lecture for Barn magazine discussing ‘The end of Welsh European Union membership – The Lessons from Austria-Hungary’.

In view of my position as a sponsor of the private bill by James Wharton, MP for Stockton South, calling for a referendum in 2017 regarding our future within the EU, and my membership of and contribution to the ‘Fresh Start’ Project, including being one of the authors of the project documents calling for a more flexible European Union, perhaps I have no-one to blame but myself for my apparent obsession with European issues.

Even so, my lecture today is not on the failure of Brussels or Europe.  Wales’ failure to profit from huge European investment since 2000 falls on our shoulders as Welsh people and reflects the political leadership and major deficiencies in the Assembly’s strategy to utilise these funds.

Indeed, the whole European jamboree has become a monetary fund for local authorities, education and third sector bodies, with the private sector, that sector of the economy which should be contributing to economic growth, getting virtually no portion of the financial cake.

It is hardly surprising that having neglected the very part of the economy that exists in order to create wealth, we have seen Wales’ relative economic performance regress rather than develop for the better during a period that now extends over fifteen years of funding projects throughout Wales that should have contributed to our economic benefit but which did nothing of the sort.

Compliance not Outcomes!

Before ending this introduction, I will aim one small kick (and I emphasise, one only) towards Brussels.  As a member of the Committee for Welsh Affairs I have enjoyed two quite valuable and useful visits to Brussels.

Our Chair, David Davies MP for Monmouth, despite his significant doubts about the UK’s relationship with the EU, believes strongly that we should know Brussels and, more importantly, know how the place works.

The two visits so far have been most useful and it is fair to note that the co-operation between our four MEPs is evident and constructive.  Oddly enough, this co-operation has improved following the election of a UKIP MEP!

But on to my complaint, in September 2012 we had a meeting with the officer within the commission who deals with regional funds.  Had a member of the Welsh government or WEFO staff been present they would have been delighted.

“We consider Wales an exemplar region” were his very words.

Now, in view of the weakness of Wales’ economic performance since the advent of Objective 1 Funding in 2000 I found this comment to be astonishing.  So I asked how could such a statement be justified in the context of such a poor economic performance, not to mention the fact that we remain eligible for European investment almost fifteen years later?

The answer was revealing;

“We measure compliance not outcomes” were the officer’s words.

So there’s a slogan for devolved Wales;

Never mind the economy, look at the standard of our paperwork.

Of course, a high standard of paperwork isn’t going to transform any economy but it means being seen as a conscientious government by officers in Brussels while maintaining your armies of civil servants in cosy jobs.

Perhaps such a strategy is intentional after all.


What’s galling about the failure of our efforts as a nation to make use of European funding is the fact that a track record of failure existed even before we managed to create an artificial map of Wales in order to attract the higher rate of support.

Before I am misunderstood let me clearly note that I do not blame anyone for drawing up the remarkable map of Wales that was a basis for making Wales eligible for European funds.  Despite the problems this map, which merged West Wales with the Valleys, has created since 2000 let me state now that the logic for creating such a map was constructive and understandable.

It is our failure to use the funds effectively that has led to my belief that this remarkable map is now part of the problem, but I will return to this shortly.

European 5B funding – nothing learnt

No, my point is that we here in Wales had succeeded in attracting European funding before the advent of Objective 1 and indeed, my self-employment commenced through work that came to me by means of a scheme financed by Objective 5b and I believe that I am also correct in stating that I attracted 5b funding for the ‘Welsh Slate’ project in the mid-90s, the biggest Private Sector led scheme to receive 5b funding.

And that was the background that was evident even before the introduction of Objective 1 funding.  There was a tendency to see European funding, albeit intended to strengthen the economy, as a means of financing programmes by intervention in the local economy by Local Authorities and Third Sector bodies and not as a means of strengthening the private sector.

I made this point in a review of 5b Funding expenditure in Gwynedd before the introduction of Objective 1 Funding and I clearly remember discussing this very issue with Professor Phil Williams and Dafydd Wigley at a conference in Seiont Manor hotel at the start of their time as Assembly Members.

My concerns were rejected by both, with Phil Williams arguing that the sum of European contribution under Objective 1 would be so substantial that it would in itself transform the attitudes and enthusiasm of the Private Sector for investing in West Wales and the Valleys.

Notwithstanding the fact that no-one of matching ability has been elected to the Assembly since the loss of Phil Williams, a fact which remains true despite the election of Plaid Cymru’s latest great white hope on the first day of August, this response reflected an academic’s naivety rather than a businessman’s realism.

It can be argued that such a description would be equally true of the two rounds of European funding that have taken place since then, but in comparison with Phil Williams the academic capability of the creators of the ineffective European programmes run in Wales since 2000 is pretty feeble.

However, with regard to the background, my criticism today is not based on the benefit of hindsight, but is a continuation of a frustration that has plagued me throughout my period of dealing with European funds while self-employed for fifteen years as well as my experience since being elected in 2010.

Wales’ Economic Performance since 2000

Of course, if I am to prove my allegation that European Funding has exacerbated the dependency culture we have here in Wales I probably need to prove to some of you in the audience that we are discussing a story of total failure.  After all, when I discuss my concerns about this issue the answer I get from many politicians is that the situation would have been seven times worse without such funding.  Although there is a smidgeon of factual justification for such a statement, it is a weak argument in response to our failure to do better with an opportunity that appeared to Phil Williams in 1999 to be a golden one and a one-off opportunity for change.

The plain truth is that Wales’ economic performance since 1999 has been so disastrous as to prove without doubt to me that our use of European funding has been an unmitigated failure.

Objective 1 Regions – 1999 v 2010

In the first place it is worth noting that 57 European regions were eligible for Objective 1 funding within Europe in 1999, a Europe that did not, of course, include any of the eastern European nations.  Nations such as Latvia, Estonia, Poland, the Czech Republic and Slovakia did not become part of the EU until 2004.

The cry from political leaders in Wales was that we had to take advantage of Objective 1 funding because we would never again benefit from such support as we would not fall under the 75% threshold of the EU’s GDP following the entry of the Eastern nations into the Union.  The tragedy of the situation is that we have remained eligible not only in 2007 but yet again from 2014 onwards.

That says a lot about us when you consider that countries such as Romania and Bulgaria have been members of the EU since 2007.

Two out of Fourteen

But to return to the point, of the 57 regions in receipt of European regional fund support at the highest level in 1999 fourteen remain eligible in 2014, and of those only two regions are not within Greece, southern Italy or Portugal.  West Wales and the Valleys is one of the two regions that join the poorest areas of Greece, Italy and Portugal in continuing to receive European funding at the highest level.

In a period that saw every one of Ireland’s regions lose support, as did every single region of the former communist East Germany not to mention all but one of the Spanish regions that received the highest level of support in 1999, Wales’ performance is quite a failure.  A failure made here in Wales.

Even in the UK, Northern Ireland, Merseyside and the Scottish Highlands showed development but not so our region, created specifically in order to attract European funding.

So what about the Welsh performance, how bad has this been?

The word atrocious would be no exaggeration!

The yardstick used for European aid is GDP per capita.  This may not be a perfect measure but this is what is used in Brussels to determine in what direction European financial support should be aimed and of course the West Wales and the Valleys region was created specifically as a European region in order to ensure that a comparatively substantial area of Wales fell within the profile of being an area with a GDP of less than 75%.

Eurostat statistics show that Wales’ GDP was 89% of the European average in 1999 while West Wales and the Valleys stood at a percentage of 75%.  By 2010 the corresponding figures show a downfall in Wales’ performance to 81% of the European average while the region in receipt of Objective 1 funding has fallen to 70%.

Success = faring slightly better than the rest of Wales!

In other words, Wales’ relative GDP fell about 9% measured against the rest of the EU while West Wales and the Valleys fell about 7%.  So perhaps it could be argued that the relative performance of west Wales measured against the rest of the country is a success as the decline is slightly smaller, but that is hardly surprising when one considers the substantial money invested by the EU besides the match funding attracted in order to finance some of the individual projects. And of course, a decline that is comparatively better than the rest of Wales is not a particularly good basis for claims of success.

These should be sobering statistics for all politicians, all ministers who have served the Assembly government since 1999 along with all the council economic development departments of west Wales and the Valleys.

Such an expression of regret, however, seems unlikely, with declarations of pride, almost, emanating from these bodies upon hearing that the poorest region in Britain is again set to receive European funding at the highest level.  Taking pride in failure as the jobs and fat salaries of the select few are safeguarded by their very failure.  I will return to this point!

Unemployment Statistics

To those of you querying the efficiency of GDP statistics as a yardstick, consider then the unemployment levels of West Wales and the Valleys between 1999 and 2010.

Unemployment rose from 7.5% to 9.2%, a relative increase of approximately 20%, which corresponds almost exactly to the increase seen in Wales as a whole.  Nevertheless, the message that emanates from the long-term unemployment statistics is the final word, I would argue, on my case that European funding has completely failed to transform the economy of West Wales and the Valleys.

An increase of almost 80% was seen in the number of long-term unemployed in West Wales and the Valleys between 1999 and 2010, a figure higher than the corresponding all-Wales increase, and since 2010 this statistic has continued to grow within the region with an increase of 100% recorded between 1999 and 2012.  The statistics are again sourced from eurostat.

It would take a brave man to claim success in the face of such statistics, and let no-one suggest that things could have been worse.  What we have in these statistics is indisputable evidence of Welsh failure – this is our failure, not Europe’s.

Consider in all seriousness that there are regions within the Czech Republic and also within Slovakia that now enjoy per capita GDP levels that are twice the level enjoyed in west Wales and the Valleys!

Consider that the Czech Republic will become a net contributor to Europe’s budgets barely a quarter century after escaping the dead hand of communism.

Consider that even the poorest English regions have performed better than west Wales and the Valleys and ask yourselves why.


Accepting our failure could lead to a hope that the situation might be reversed, but I wouldn’t hold my breath.

The last time I considered and studied the statistics on projects supported by European funding, the finding was that private sector led projects represented less than 1% of the investment made by WEFO.

Indeed, in the Bodnant Welsh Food Centre in the Conwy Valley I have the privilege of representing one of the most prominent of these projects.  It is too early to state that this scheme will be a success in contrast to the failure of so many projects across the length and breadth of Wales under local government or third sector leadership, but so far it augurs well with local people working in buildings adapted by local firms, selling and preparing Welsh produce for visitors and residents of north Wales.  Here’s hoping.

Nevertheless it is disgraceful to note that the number of projects under private sector control and leadership is no higher today than it was under Objective 5b at the end of the last century.

Creating Dependency Indirectly

So what about those projects supported that fell within what was deemed acceptable by WEFO?

Well here’s a few of those schemes and what became of them.

La Scala Cinema in Prestatyn

European grant of £376k and full costs of £572k.  According to the WEFO website this project would contribute to “essential mainstream services which will encourage community economic regeneration”

Closed for a period and facing liquidation, La Scala now receives an annual revenue contribution from Denbighshire County Council of £54,000 to keep the centre open.  It is difficult to comprehend how a scheme that was intended to promote community economic development can do that in view of the evident need for a local government grant to survive.

And having mentioned the Cinema, a pattern appears to be developing here with Theatr Mwldan in Cardigan also containing two screens if I recall correctly, all provided, together with the Theatre, following a European grant of £1.6 million as part of a scheme that cost, believe it or not, £7.7 million.  To quote WEFO this project would;

“ensure the creation of a new, local, rural economic development centre to encourage diversification and growth in new markets with new skills and products”

Currently Ceredigion Council provides a revenue grant of £28,000 per annum for this centre.

And of course there’s more!

Theatr Gogledd Cymru received a European grant of £4.8m from a redevelopment budget that was £12m but as a central part of Conwy Council’s services the local authority was unwilling, following my enquiries, to provide a figure for the support received on an annual basis by the Theatre in order to operate.

And then my favourite.

The WEFO website has a reference to a ‘Rural Life and Sculpture Centre – Phase 1’.  To those of you from the Bala area, this is Canolfan Cywain.  A European grant of £900k in a scheme that is worth £2.2m according to WEFO but £3.44m according to Gwynedd Council.  Perhaps the second figure includes Phase 2?!

The intention of the project was, and I quote again:

“to create a centre to allow all sectors of the community to participate in the economic and social development of the area”

I’m not sure how that is likely to happen as the centre is closed down, but there we are – it was open while the revenue grants lasted.  Even so, the rest of the blurb on the WEFO website is astonishing.  Considering the location of the centre in one of the most Welsh-speaking areas of Wales, it is revealed that the grant will ensure:

“a centre which will offer visitors a unique cultural experience celebrating the Welsh language, heritage and contemporary rural life”

As the centre now stands empty, consider in all seriousness that Bala is incapable of providing a successful centre to celebrate the Welsh language and culture although, when it comes to celebrating contemporary rural life in today’s Wales, a centre that is closed due to lack of grant aid or financial support from local government is probably quite representative and very apposite.

Another one to close and then I promise to move on.

Pantyfedwen Pavilion – A Catalyst for Regeneration

A European grant of almost £1.4m with the project costing no less than £3.2m.  Once again to quote WEFO;

“the project will act as a catalyst for the regeneration of the village providing direct employment and creating spin-off benefits through the attracting of significant visitors utilising the natural strengths of the area such as its cultural diversity”

Well that wasn’t quite correct either as the initiative failed within three years.

And before anyone says that I am picking and choosing, I’ve ignored dozens of other examples, although there are plenty of them that are just as disgraceful as the ones I selected.

The same is true of projects under more direct government leadership such as the Genesis project which was a total failure together with a very substantial number of projects to train those individuals known as the economically inactive.

These projects have manifestly failed if one merely considers the substantial increase in the numbers of long-term unemployed.

Summary of my First Argument – Creating a Sense of Dependency

And that in a way is the first example of my central argument, namely that the use of European funding has strengthened, not released our communities and people from this concept of dependency on the state.  In countless cases what transpired were projects that existed solely due to grants, capital from Europe perhaps with the revenue funding coming from a combination of Europe and/or local authorities.  The message given out by such cases is one of economic dependency, not independence.

Rather than foster the appetite and circumstances for success and enterprise what we get are constant stories of jobs lost because the period of grant aid is coming to an end.  In many cases we have also seen substantial and expensive centres close because maintaining such resources commercially in our world of public funding dependency has been too much of a challenge.

Exactly what message is this for communities and individuals in west Wales and the Valleys?

Without a doubt I believe that the experience and evidence for communities throughout Wales generate a sense that projects and enterprises cannot operate successfully without grant aid, and when you consider the nature of some of the applications it is difficult, if not impossible, to avoid the conclusion that the officers considering these applications, advising the applicants and making their recommendations, were fully aware that there was no hope of success.

Indeed, so great is the failure in many of these examples that you can almost believe that within the officers’ subconscious there was almost an acceptance of the fact that these schemes were destined to fail.  After all, if the projects did not prove to be a ‘catalyst for economic regeneration’ then the region would remain in need of support thus keeping at least some of the officers in well-paid jobs.

Direct Dependency

Now, the reason I present these examples is that there exists a lengthy and complex process full of bureaucrats and consultants – and here I am quite happy to declare an interest; I too made a few European applications myself before being elected and was paid generously for doing so.

As you have already heard there was a specific phraseology that helped and I don’t believe the Welsh language and culture have ever been shown so much superficial respect as that seen within these applications.

After all, placing a tick in the ‘diversity’ box enabled you to score a point or two more for your application.

But the most important point here is that large numbers of staff were directly dependent for their employment on what was considered a process of attracting European funding – a process that created a use of a public sector language that said as little as possible with an extreme use of Welsh bureaucratic phraseology.

Inclusive, sustainable, catalyst, community, culture, diversification, environmental, etc.  Each word meeting politically correct requirements ensuring that the requirements of the European programmes (developed here in little old Wales) were met, in ways that were ‘interconnected’, ensuring that the ‘multi-disciplinary themes’ were reflected within the latest project that was set to contribute to the regeneration of the economy of such-and-such a place.

And before anyone asks, I don’t understand half of this Welsh European terminology, all that is certain is that neither the vocabulary nor the evident self-importance has anything at all to do with creating a stronger economy.  But it all justified jobs for the public sector.  And in such numbers!

The Wales European Funding Office (WEFO)

In WEFO there are no fewer than 163 members of staff distributed in offices in Merthyr, Aberystwyth, Carmarthen and Llandudno Junction.  These are some of the few jobs that were more than a promise in an application as we discuss the promises to transform the Welsh economy!

And of course WEFO was not the only place where these direct jobs were created.

Many councils in West Wales and the Valleys admit that they have specific European officers, individuals who are there to offer assistance (not to draw up the application but to interpret requirements mainly) to bodies wishing to attract European funding.  Three in Conwy, 2.5 in Ynys Môn, 2.5 in Gwynedd, 2 in Blaenau Gwent and 3 in Torfaen, to give you just an idea.

And before anyone starts to think that such numbers are not unreasonable; don’t forget those staff within County councils within the region in question that is working on projects financed entirely by Europe.  Twenty in Gwynedd, 17 in Torfaen and I could go on. With 11 Councils within West Wales and the Valleys it is difficult to believe that there are not between 250 and 300 local authority officers in the region whose posts are dependent on European funding or the bureaucracy that goes hand in hand with such finance.

In other words, within central and local government there are approximately 450 to 500 staff employed simply due to European funding.  It is no exaggeration to suggest that there is a very substantial number of local government staff or staff within WEFO who are fully aware that continuing to operate and manage a European financial programme is vital to their chances of maintaining their employment.

I can’t give you a number, but if you simply consider the further and higher education sector you will very soon find that a small army of European officers exists within these bodies too in order to milk the system and ensure that higher education receives funding for this, that and the other which should be part of its daily operations.

And here I must raise my hat to Bangor University, despite the existence of Galeri in Caernarfon (European Grant) and Theatr Gogledd Cymru in Llandudno (European Grant) and quite a tidy Theatre that existed in Bangor (Theatr Gwynedd) the University’s European officers succeeded in attracting astonishing sums of finance for another arts centre that will, in due course, I maintain, be seeking revenue funding from a combination of arts quangos, the University and Local Authorities.

At a recent conference in Cardiff for European officers in the field of education I addressed an audience of over 50 on this topic – it is hardly likely that every single such officer was present and one can easily believe that we are talking about 100-150 direct officers again in this field that are dependent on the existence of ‘European funding’ for their livelihood.

The Third Sector

The numbers increase further when we consider the third sector – I offer one example of a very commendable body, Menter Môn.

This third sector company was originally established to distribute LEADER funds in Ynys Môn and employed a Chief Officer and a part-time assistant member of staff.

In preparing this lecture I asked Menter Môn how many staff they now employ.  The answer was about 70.  Now consider this: Menter Môn’s purpose when it was established around 1996 was to strengthen the Ynys Môn economy by using money from European funds.  Considering the company’s substantial, nay astonishing, growth, one might expect the story of Ynys Môn’s economic transformation to be an amazing success story over the last 15 years and more.

But the truth is different.  The Island’s economy continues to dwindle to a point where the demography of Ynys Môn suggests a society and communities that are unsustainable.  Only one question is needed in Ynys Môn when considering the Island’s economy, namely where are the young people aged between 18 and 34?  Not on the Island in most cases, is the answer.

Now let me stress – Menter Môn is a success in terms of a company’s responsibility to act for the benefit of its staff and to ensure a healthy balance sheet and strong cash flow.  Nevertheless, it is difficult to avoid the plain truth that that success is a reflection of the failure of the Island’s economy.

The greater the failure, the greater is the opportunity for Menter Môn to attract funding for various projects.  They may do very little fundamentally to change the economic pattern but at least they give the impression of action to those who distribute the grants.

Menter Môn is one of many third sector bodies with relatively generous employment terms that are entirely dependent on schemes financed either directly or indirectly by European funding.

Do they have a real reason for wishing to create genuine change in the economic situation of the communities and areas they claim to serve?

A reasonable conclusion is that Menter Môn’s decision to offer a service in Gwynedd, Conwy and Denbigh is a fairly obvious hint that ensuring the future of Menter Môn is the priority, whatever the original ideal.  Menter Môn is one of many, as I noted.  It would not be unreasonable to suggest that there are 1500 staff in corresponding bodies within the third sector that owe their existence to European grants within West Wales and the Valleys.

We are talking now not about hundreds of direct jobs, but thousands.  Isn’t it natural that these individuals, at least subconsciously, are aware that their future is linked to Wales’ ability to attract European regional funding?

This is the Welsh dependent state – even within those bodies calling for enterprise creation.  Dependency on the public sector by means of European funding is what ensures the future of bodies like Menter Môn, Menter a Busnes, Antur Teifi, Menter this and Menter that, or ‘Initiative this and Initiative that’ if you are in the Valleys.  They all encourage enterprise but do so through a process of dependency.  Only in Wales!

Government Dependency

As I have argued, Communities have had bitter experiences throughout Wales of the importance of dependency on the public purse.  That has happened, to an extent, as substantial initiatives received major capital funding, revenue funding for a period and then had to face market forces and failed.

I would argue that there are a few thousand various officers in central government, local government, the education sector and third sector bodies that are entirely dependent on economic failure in order to ensure their main sources of income.  An incentive to succeed?  It’s hard to believe so.

And then what about our Government in Cardiff Bay?

Unfortunately they too are fully aware of the need to ensure the continuation of the European funding drug.  How indeed could they exist without such finance?

I will offer one example amongst many.

Business Connect = Business Eye

Consider the process of supporting business and enterprise here in Wales.  Business Connect existed from about 2003 to 2008.  Unfortunately, as it was starting to establish itself the finance from European funds was coming to an end.  What was the answer?  How to keep on as many of the staff as possible?

The answer?

Re-launch the whole thing as Business Eye.

Another example of senseless change in the view of Welsh businesses as a scheme that was starting to establish itself was replaced by the launch of a new, vaguely similar scheme, but with enough differences to be a nuisance for users, and all because European rules mean that the same project cannot be financed twice as that would be proof of the un-sustainability of such a project in the first place.

The option for a dependent government was to reinvent the wheel to a degree that would be sufficient to attract European funding for a new project.  No consideration was given to the impact on users – what was crucial was to maintain public sector employment within the Welsh Government scheme partly financed by European funding.  Continuation of the dependency was what counted, not the process of providing support for businesses.


From central government to local government to the third sector to the effect on our communities – the message sent out by our use of European funds here in Wales is that we are a dependent nation and people, living on our ability to prove the extent of our need so that we can continue to maintain some relatively comfortable jobs at the expense of poverty for the majority of our fellow inhabitants within the communities of West Wales and the Valleys.

Is there an answer?

As part of the ‘Fresh Start’ project I have argued that European Regional Funds should be restricted to those nations with a GDP of less than 90% of the European average.

At present a substantial portion of European structural funds are provided and also received by a Member State that has a GDP of 90% or more of the European average.  Is there any sense in transferring funds from the UK to Brussels in order to see that money then transferred onwards to Paris or Stockholm while Stockholm and Paris contribute funds to Brussels to be transferred to the UK?  That is what happens at present.

If European funds were targeted at those nations that have a per capita GDP of 90% or less of the European average, this would sustain the contribution to the union’s poorest countries while saving money for the biggest contributors.

In the case of the UK, following a policy of 90% or more would represent a saving for the Treasury of between £4.6bn and £5bn depending on our choice of yardstick in the first place (GDP or GNI per capita).  If we take the lower sum, £4.6bn, the Treasury could fully finance the contribution that comes to Wales and other UK regions that receive European funding while also making substantial savings (over £2bn) centrally.

I hear some say that such a change would be advantageous to London but what about Wales?

I would however suggest that such a change would offer substantial benefits to Wales.  These would include;

  1. An end to our use of geographical areas such as West Wales and the Valleys that exist solely for the receipt of European funding.  The regional finance from London should be used within economic areas that recognise Wales’ economic situation as it is rather than as some of our politicians would wish to see it!
  1. Less dependency on programmes agreed in Brussels by discussion with a Welsh bureaucracy that has had its chance and failed.  With partnership financing between Westminster and Cardiff Bay would it not be possible to create substantially financed Local Economic Partnerships that have the ability to make a difference?
  1. An end to the diversion of Welsh and UK funds in order to ensure European funding.  Time after time we have seen prominent failures in European projects but the sadness of the matter is that realising these projects has also demanded a financial contribution from the member state or other funds such as lottery funding or private sector funding.  In other words, in order to waste European money we have also wasted corresponding Welsh and UK money which could, without exaggeration, have been spent more efficiently without the existence of the European funds.
  1. We can ensure a system that punishes failure rather than focusing on the standard of paperwork.  If we are to continue to attract regional funds, it should be based on success, not failure.  How strange it is that such a statement runs contrary to the European criterion where failure is rewarded – a way of thinking that has appealed to our new Welsh bureaucracy.

Such a change would be no small matter and I can hear the complaint now that London would not be interested in a ‘genuinely’ regional policy.  But, and I will finish on this ‘but’, the alternative of managing regional development in partnership between Cardiff Bay and Brussels has had 14 years to succeed and has been a total failure.  I am willing to declare here today that the period from 2014 to 2020 will be no different.

We have a responsibility now to acknowledge this failure and to recognise that if we are to create a firm economy and give our people the opportunity to become economically active within their communities we need to try something new.  Either that or accept that economic failure is an inevitable part of Welsh life.


Guto Bebb is Conservative MP for Conwy

8 thoughts on “IWA Eisteddfod Lecture – EU funding: Wales’ latest dependency culture?

  1. A debate that is required,albeit on a less shallow level than Guto Bebb sets out.

    I run a small business in rural north west Wales and benefited from objective one monies when I invested in a new It system.This was via the LEader programme and PEG Gwyned,and I know of many other small businesses who have done the same.

    What of the technology parks spinning off from Bangor and Swansea universities?By all means provide an assessment os success and failure of every penny ,but acknowledge the successes as well.
    Guto wants London to be providing the funds?What in the same way that his predecessors did in industrial Wales after the heavy industries closed down?

    Successive governments in London and Cardiff have failed to inprove the Welsh economy,which is a complex and expensive task.Guto has no insight or practical advice to change things,anymore than our sleepwalking first minister or inneffective secretary of state.

    Remember LG? Was it William Hague who threw millions of pounds of public money towards the mirage of a large multinational descending upon Wales doling out hundreds of new well paid jobs only to dissapear int the ether with the publics’ money in their back pocket.How much did they eventually get back?

    There are no easy quick answers.High speed broadband,food processing and tourism is a big part of it,but until governments of all hue work out a way of engineering prosperity for the post industrial landscape,with its ill health,despair and poverty Guto and speeches like this will be quickly forgotten.

    Could it be that a more radical solution could be required,where the economy of the uk needs to be decoupled,with the wealthy south east requiring one economic policy ,with the poorer regions requiring another?Is the UK micro economy a reflection of the wider travails of the euro?What is good policy for Germany may not be good policy for Spain and Italy,a similar conflict to Wales and the south east of England?

    Hopefully, a Labour representative will be asked to provide a perspective,at least Guto has an excuse that his party hasn’t been in power in Cardiff or during Tony and Gordon’s 14 years

  2. “……partnership between Cardiff Bay and Brussels has had 14 years to succeed and has been a total failure.”

    Mr Bebb is correct. However, the ‘partnership’ between London and Wales has existed for 700 odd years and has also been a total failure. That’s why the Assembly was established. Mr Bebb is rather selective at which points in history he would like to begin measuring our economic performance from. However, if one dismisses his argument to revert to a reliance on London’ I agree with most of what he says in his lecture. What’s needed is a change of government is Cardiff. Could one possibly argue, like the staff distributing EU funding, the Labour Party in Wales knows fully well that our continued poverty is a reason for their continued power and wealth?

  3. The analysis of the problem here is spot on. It is an unspoken truth that EU funding has been a gravy train for the public and third sectors with no real incentive to improve the economy.

    The proposed solution, however, should ring alarm bells. It looks like the post-2015 Tory (if they get re-elected) narrative will be along the lines of “Welsh devolution experiment has failed – economy even worse than in 1999 – public services falling apart and increasingly dependent on the English (particularly if Scotland leaves the union) taxpayer – time to end devolution and return control to Westminster!”

    At the very least, it is incumbent on Labour (and to a lesser extent Plaid) to outline how they will address this issue so that we start to see a genuine and sustainable improvement in the Welsh economy.

  4. If this was medical diagnosis you would only have identified a symptom not the underlying cause.

    The underlying cause of Wales’ demise is socialism – specifically socialism that does not appear to understand that public funding has to be earned by the private sector before it can be spent by the public sector.

    Apart from building white eliffants, part of what the public sector in Wales is doing with ‘EU’ funding is replacing private enterprise with subsidised publicly owned enterprise which is seldom efficient or profitable. Everywhere I look I see public funded business operations competing unfairly against the private sector and driving the private service sector out. It is almost like Cuban-style nationalisation but by stealth with more and more of the workforce functionally dependent on public sector spending for their continued employment.. In the GDP and employment figures this has been masked by moving direct public sector spending and employment into the service sector.

    These Llafur and Plaid supported policies have failed and failed badly. They must stop before the people in Wales need to move to Bulgaria for a better life! I would opine that the private sector in Gwynedd has already sunk to that level.

    The public sector in Wales urgently needs to be weaned off its addiction to spending more than can possibly be earned from taxation on real added value but there is no sign of this happening. So the ‘EU’ funding is like giving alcohol to an alcoholic…

    But where is the oppostion from the Welsh Tory AMs – who seem to have become part of the problem not part of the solution?

  5. I am passionate about Welsh devolution and recognize that it needs to continue if we are do get our economy on track. I am however amazed though that nobody from Labour, Plaid or the Lib Dems have responded to Bebbs piece. Do they think that all is fine or do they agree with him but just don’t have any remedies? It’s rather worrying.

  6. I always thought that the way forward is less UK obsessionism – as is the want of the British nationalist parties in Cardiff Bay and Westminster – and more real interaction with all of the peoples of Europe. As a businessman of 40 years I am forever encouraging people to look beyong insularity and trade with our mainland partners. What annoys me most is those who link education with business, who appear to be fanatical about comparing our students A Level results with those of England. Why on earth do this? We are boxing our children in and not allowing them the scope to work in, and appreciate, cultures beyond this EU member state. Having worked with companies in places as diverse as Portugal, Luxembourg and Estonia I know that there is so much out there that would be of immense benefit to our people and organisations in the decades ahead. Sadly, the Britannia mist blocks our vision.

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