30/09/2012 Sunday Politics Wales

On the Sunday Politics Wales, or we will be after conference again as

Labour meet in Manchester. We will hear what the shadow Welsh

secretary, a Owen Smith, makes of the conference coalition talk and

we will hear concerns that small companies are in danger of being

looked -- overlooked despite their importance.

Joining me today is Mick Antoniw and Alun Cairns. Good morning.

Before we hear from a Owen Smith, let's talk about what is coming up

next week. The Labour assembly government, Welsh government, will

publish its draft budget. There will be lots of knockabout to get

it published. This is a tiny look forward to? It is a time of

uncertainty because it is a difficult budget. The assembly is

in receipt of a block grant so it does not have any leavers. It is a

question of getting the balance between business support, health

and education. Without a majority, Alun Cairns, you have been in the

chamber when these Bowett -- votes take place. What is a perspective

from the opposition bench? De you try to frustrate the government

will go for a good deal? opposition is constructive because

it is a fixed budget. I would disagree with me then that council

tax in Wales continues to go up to a more money to the Welsh budget

which is different to that in England. The opposition is

constructive. The opposition at the time was about tuition fees,

ironically, when I was part of those negotiations. Getting money

to community schools was a priority and we managed to squeeze

differences and changes. And sure this is something we will discuss

in the coming weeks. In the meantime, the Labour Party

conferences under way in Manchester. Our Correspondent has been speaking

to the Pontypridd MP, a Owen Smith. Hello from Manchester. The next

general election isn't until 2015, but two-and-a-half years can be a

short time in politics and Labour will use this week to unveil some

of their policies. Let's find out more with the shadow Welsh

secretary, a Owen Smith. Your predecessor has written in today's

Independent on Sunday about how difficult it will be far Labour to

win the next election, talking already about the prospect of

coalition with the Lib Dems. will be difficult, we know that. We

know that we had the worst defeat since 1918. It was a truly awful

defeat for Labour and we know we have to work hard to win back trust

in order to give us a chance of winning. We are definitely the

underdogs in this fight right now, but we are doing better than last

year. We are doing certainly better than two years ago so I don't think

we need to stop thinking about whether we would go into coalition

with the Lib Dems or anyone else. We are going to win the next

election and that is what we will do here at conference this week.

you have any objection of going into bed with the Lib Dems after

their time in government with the Conservatives? I think it will be

difficult because we feel that the Lib Dems have cropped up the right

wing Conservative government. They have been handmaiden to decisions

that we think have divided Britain, tax cuts for millionaires and some

of the other measures they have taken. Resulting in tougher times

for families right across Britain, it will be different -- difficult.

But I don't think people are thinking about how difficult it

will be to go into coalition, they want to hear about what we are

going to do. He mentioned that tax cut for millionaires, it is

actually a tax cut for people and in �150,000 per year, not every

millionaire earns that much. Would net -- Labour go into the next

election promising to restore that rate? We have said very clearly

that if there was an election tomorrow, our priority would be to

make sure that those with the broadest shoulders bear the biggest

burden. That means that we would put back at the rate to 50p. That

would be the fair thing to do at a time when ordinary families are

struggling in Britain. Giving a tax break to those who earn over

hundred and �50,000 and for 14,000 millionaires in Britain, that does

mean a �40,000 tax cut. 14,000 of them do earn up to a million and

they will get the tax break next April. That does not strike us as

fair. If it does strike us as being representative of the Tories not

generally it reflecting and representing people right across

Britain, but having the interest of privilege and wealthy people. We

are about representing people in all of the countries of Britain and

also trying to represent people on all income scales. What would you

spend that extra money on? We are not going to lay out the budget

right now. You told me want to put up tax, but you don't know why? You

don't know what you spend it on. we have already said there are lots

of things we would do to increase demand. We would certainly

introduce a holiday for small businesses. We would introduce

greater infrastructure spending. We would hold down tuition fees. Some

of these things we have attached a specific part of money too. One

example we said we would reintroduce the bankers bonus tax

and use that money to fund a youth jobs and affordable homes across

Britain. Other areas like infrastructure, we would need to

look at in the round. It is crucial that we do that. We are winning

that economic argument right now. Most people have begun to

understand that when we said they were cutting too fast than going

too far, they really were. They are taking demand out of the economy

and we are seeing less willingness to spend and as a consequence we

are borrowing more money and are in a deeper recession than we needed

to have been. That has happened on the Tory watch as a result of their

policies. You are against tax cuts for millionaires, why did

millionaires in Wales get free prescriptions? If we get free

prescriptions right across the board because we believe in

universal benefits. Even for rich people? There is a good argument to

be had. In Scotland it has been raised by the Scottish leader of

the party there. It is a legitimate argument to have been a time in

which we are cash constrained and in which the difficult decisions

have to be taken, but there is something intrinsically valuable

about universal benefits which is why Carwyn Jones and the government

in Wales cleave to them. They bind us together. They are part of the

Gin in society. Everybody pays taxes and everybody has access to

those services. That's big society together and I think that is

something we should throw away with real, real care. Thank you very

much indeed for joining us. That visit from Manchester for the

moment. A few days of parlour games still to go.

And sure David will make the most of that. Alun Cairns, I will start

with you. The key thing there was the response to what Peter Hain had

to say. Labour very much flirting with the Lib Dems if you listen to

Peter Hain. Are you jealous? Peter Hain is an X Liberal as he would

have been in those days. What is significant than what he had said

is almost accepting that Labour will not win the next election. He

understands, just like the general population, that Labour have not

reformed. If you look to their front bench, Ed Balls who was the

key adviser to Gordon Brown when he was Prime Minister and Chancellor,

one of the architects of the economic failure of the biggest

bust we have seen in almost a century, he is still there. He is

in a pivotal position. In spite of the opinion polls, if you look at

the ratings of Ed Miliband, that still stays with the Conservative

Party. If I would like to believe that will be the springboard for

which we will fight the next general election campaign.

didn't seem to be the message from a Owen Smith, did it? The opinion

polls are indicating that Labour is heading for a majority. The there

is a long way to go. The problem with talking about the Lib Dems is,

we don't even know if they will be the third party in British politics

in two-and-a-half years' time. talk about the Lib Dems then?

he is an X Lib Dem. What is possibly more likely is, if there

wasn't a majority, it might be the case of looking at a deal with the

other parties, other than the Lib Dems. The Lib Dems may well be

wiped out. Their reputation is toxic at the moment particularly

under the leadership of Nick Clegg. Not as toxic air of the big leaders

of the Labour Party. Ed Balls is still there. We will see the

differences between Ed Balls and Ed Miliband grow further part in the

coming years. If that is what we have seen in recent months. I think

you are so wrong on that. If anything, Ed Balls at's view that

we have been cutting too fast and taking demand out of the economy

has been proved right. Ed Balls, at the moment, is at the forefront of

what the Tories are thinking that perhaps he was right and we should

go down the road of building demand and investment to achieve growth.

Plan A still stands as far as the government is concerned? Everyone

knows that if you spend more the new UN, you need to cut back and

that is what the government are doing. Every body will understand.

That is what we are seeking to do from a very low base. Let's look

ahead to the conference. Every conference tends to the about the

leader whether they are trying to establish themselves or defend

attacks. Where does Ed Miliband speech fit into that this week?

think he is making an impact and opinion polls show that. They see

him as a credible prime minister? If I think he is and that is why

they are Tory opinion polls directly on his capacity to be

Prime Minister. Why would they do that if they were not fear for he

might be the next prime minister? That is what the game is, this

ping-pong of politics. Distract from your own economic failures and

attacked the credibility of Ed Miliband. I think that shows he is

succeeding. How important is his speech for Ed Miliband to persuade

people he could be the next prime minister? It is important. He will

want to make his case. Economic clear think it is impossible for

him to do so because they have not reformed and accepted failures of

what they did previously. Also, people still remember that he

stabbed his brother in the back to get the main role and he is

associated with that. Oh, come on. They if you ask any focus group,

public opinion will say that people think he stabbed his brother in the

back. As a result, people find it difficult to trust him. If you are

prepared to stab your own family in the back. That is the message they

want to put out. It was a fair election which he won. With the

backing of union support. We will leave it there.

Small companies are in danger of being overlooked, according to some

business leaders. Ministers denied that anyone will lose out at the

they decided that Finance Wales, which were set up to invest in

small traders, will no longer be restricted on the size of the

business it can invest in. This week saw the UK government

announced plans to channel the billion pounds to small and medium

enterprises. This chocolate shop might be a

treat for those with a sweet tooth, but getting credit and the current

environment is leaving a bitter taste than the mouth of its owners.

Mal Young says that small companies are finding it difficult to borrow

from banks. I started being self- employed in 87, so if you want me

to go back that far, if you went to the ban with a sensible business

plan, you got to the borrowing. It was very accessible and affordable.

It was quite challenging in the late Eighties and early Nineties. I

think it is harder now to run a business. It is impossible to get

funding for small businesses. shop is an example of a micro

business. These account for more than 95% of Welsh companies and are

vital to economic growth. If there is a thriving farmers'

market, but it is credit markets causing headaches across the

country. According to the latest figures, Wales has a higher

proportion of companies looking for loans than any other part of the UK.

More and more of finding them unattainable or unaffordable.

is no doubt in political commitment or solving the problem of financing

small businesses. The real question is how do you deliver that? The

only mechanism in Wales is Finance Wales. If it seems to do a big --

good job in providing funding for large capital acquisitions, but it

doesn't seem to do that good in terms of reaching the grass roots

businesses, the small micro businesses on the ground. Ministers

have decided that Finance Wales, which was set up by the Welsh

government specifically to invest in small companies, will no longer

have a limit on the size of the business it can invest in.

concern for us is that we accept that Finance Wales is the only

option we have at the moment. It has had its remit extended to cover

large businesses, but ultimately he is supporting if and engaging with

small businesses? Who is ensuring that small traders get access to

financial products that meet their needs? Finance Wales has welcomed

the decision to allow it to no money to a larger businesses. If it

says it has a successful track record over the decade of backing

growing companies, including �27 million invested in the last

financial year. The UK government is also

intervening announcing a new business bank that it expects will

provide �1 billion to small companies. We do support it, but I

think it is a mid-term measure. It is equally important to focus on

the transparency and the lending processes of high-street banks

right now and the equally important to see how we can grow more

alternative forms of finance like peer-to-peer lending. How many

announcements have we had in the last two years? We have had monthly

announcements and it is not happening. They also saying it will

take 18 months to kick in, it is not quick enough. They need to look

at reducing VAT. I did not agree with that at first, but it would be

quick and easy. If they bought in 17.5 per Saint again, it would put

money in people's pockets. Giving the importance of small traders,

support for this sector is not something politicians can afford to

get wrong. That was Brian Meechan. The Welsh

government have told us that a decision to enable Finance Wales to

invest in larger companies is intended to provide extra

flexibility if ever necessary. It will in no way affect the funds

available to Finance Wales to invest in small and medium

enterprises, say the government. Mick Antoniw, what of businesses

saying? They are struggling to get hold of money. The biggest issue I

get from small businesses the failure of application for

borrowing from the banking system. They think the figures show that

42% of applications for banks support actually failed if and an

increase on the previous year. does that suggests more people

might turn to Finance Wales and face the same disappointment?

makes the more important, but I don't think Finance Wales can ever

supplement the role of the bank's, but it is an important contributor.

Figures show that 35% of small businesses accessed advice support

in one form or another from Welsh government or local authority. It

is very important and 330,000 people work in small businesses in

Wales so it is essential to the economy. As Mick highlighted, so

many people work in small businesses, the Welsh government

has to recognise that these could be the driver the of economic

growth in Wales. Exactly. I am so sorry that the Labour government

many years ago wound up the Welsh Development Agency. That was one of

the few quangos that delivered on its objectives. Not only in growing

Welsh businesses, which is important, but attracting

investment from elsewhere in the UK and beyond here into Wales. If that

is a discussion that has had last week between both the UK and was

government. Exactly. The problem we have is the obsession with branding.

Wales in Japan, Indonesia, Brazil, where to these countries they just

about recognise the UK than think of England as the UK. We need to

work harder to get a fair slice of the cake. If you look at the number

of jobs created in the north-east last year, there were 10,000 jobs

attracted through inward investment. In Wales it was less than 2000.

That demonstrates the difference where the UK government and regions

are responding government and way you have a Welsh governments who is

obsessed with blaming the UK government far everything that goes

wrong and forgetting what they can control that -- control themselves.

We note that Colin Jones met with UK ministers last week he would 0.2

collaboration between the two. De you recognise the picture that Alun

Cairns paints? I think it is part of the political banter that goes

on. 10,000 jobs and the north-east! Economic history very close to ours

and in Wales, less than 2000 jobs. That shows the failure in Wales.

Let's hear Mick respond. We had the debate last week and what is clear

is that Carwyn Jones and the business development team are

attracting business from various countries. Carwyn Jones going to

India and coming back with �8 million of investments in Wales.

That is being expanded. The Welsh Assembly is now being far more

proactive in identifying foreign investment. We will be back with

you before the end of the programme. Time for a quick look back at the

The first minister said international transport links were

essential to economic growth. Speaking at the was government

Council for economic renewal, Carwyn Jones said he wanted Cardiff

airport to be a well-connected success.

For delegates at the Liberal Democrat conference voted

overwhelmingly against the introduction of regional pay rates

for public-sector workers. The Welsh minister warns that the

coalition government colleagues that she would fight any expansion

of the policy in the public sector. Chris Bryant said the new TV

reality show, the valleys, was patronising and upsetting. It

follows nine young people from across south Wales. The broadcaster

said the programme celebrated young people and was not about

stereotyping. The Conservative leader in the

assembly accuse the first minister of pantomime politics. Oh no he

I will play the role of the wicked stepmother. Alun Cairns, a final

word. That was what you were hinting at earlier. Precisely,

pantomime politics. The easiest thing is to blame the Westminster

government, that if you compare development to English regions to

that that is not going on in Wales, the responsibility lies firmly at

his door. This the first minister not have anything to blame the UK

government for? I think there is an awful lot. Just look at the balance

of trade. Last month, the equivalent period, �2 billion

deficit, this year, �20 billion deficit. The country is being run

into bankruptcy by the UK coalition government. Of course it impacts on

Wales, you can't avoid that. Let's look at where Wales has complete

responsibility and that his health care. Waiting times are longer,

infection rates are higher, if you have cancer in Wales, you won't get

access to drugs, that is where they are responsible. I'm struggling to

find facts. The facts are that if you have a serious illness, you

have a better chance of survival in England than in Wales. It is

something that comes up at my surgery is to regularly. I think

that is absolute rubbish. Thing England you now have 24 major

hospitals on the brink of administration because they are

being private eyes. Look at the performance, waiting times,

infection rates, those are the key. Let's leave that for the moment.

Before we go, a words on your assembly colleague, Keith Davies.

We are all saddened. We heard the news that he had gone into the