:37:09. > :37:19.On the Sunday Politics Wales, or we will be after conference again as
:37:19. > :37:22.Labour meet in Manchester. We will hear what the shadow Welsh
:37:22. > :37:27.secretary, a Owen Smith, makes of the conference coalition talk and
:37:27. > :37:32.we will hear concerns that small companies are in danger of being
:37:32. > :37:37.looked -- overlooked despite their importance.
:37:37. > :37:41.Joining me today is Mick Antoniw and Alun Cairns. Good morning.
:37:41. > :37:46.Before we hear from a Owen Smith, let's talk about what is coming up
:37:46. > :37:50.next week. The Labour assembly government, Welsh government, will
:37:50. > :37:56.publish its draft budget. There will be lots of knockabout to get
:37:56. > :38:01.it published. This is a tiny look forward to? It is a time of
:38:01. > :38:06.uncertainty because it is a difficult budget. The assembly is
:38:06. > :38:10.in receipt of a block grant so it does not have any leavers. It is a
:38:10. > :38:15.question of getting the balance between business support, health
:38:15. > :38:22.and education. Without a majority, Alun Cairns, you have been in the
:38:22. > :38:25.chamber when these Bowett -- votes take place. What is a perspective
:38:25. > :38:29.from the opposition bench? De you try to frustrate the government
:38:29. > :38:34.will go for a good deal? opposition is constructive because
:38:34. > :38:38.it is a fixed budget. I would disagree with me then that council
:38:38. > :38:42.tax in Wales continues to go up to a more money to the Welsh budget
:38:42. > :38:46.which is different to that in England. The opposition is
:38:46. > :38:52.constructive. The opposition at the time was about tuition fees,
:38:52. > :38:55.ironically, when I was part of those negotiations. Getting money
:38:55. > :38:59.to community schools was a priority and we managed to squeeze
:38:59. > :39:04.differences and changes. And sure this is something we will discuss
:39:04. > :39:08.in the coming weeks. In the meantime, the Labour Party
:39:08. > :39:14.conferences under way in Manchester. Our Correspondent has been speaking
:39:14. > :39:19.to the Pontypridd MP, a Owen Smith. Hello from Manchester. The next
:39:19. > :39:23.general election isn't until 2015, but two-and-a-half years can be a
:39:23. > :39:27.short time in politics and Labour will use this week to unveil some
:39:27. > :39:32.of their policies. Let's find out more with the shadow Welsh
:39:32. > :39:35.secretary, a Owen Smith. Your predecessor has written in today's
:39:35. > :39:39.Independent on Sunday about how difficult it will be far Labour to
:39:40. > :39:44.win the next election, talking already about the prospect of
:39:44. > :39:50.coalition with the Lib Dems. will be difficult, we know that. We
:39:50. > :39:53.know that we had the worst defeat since 1918. It was a truly awful
:39:53. > :39:58.defeat for Labour and we know we have to work hard to win back trust
:39:58. > :40:01.in order to give us a chance of winning. We are definitely the
:40:01. > :40:06.underdogs in this fight right now, but we are doing better than last
:40:06. > :40:12.year. We are doing certainly better than two years ago so I don't think
:40:12. > :40:16.we need to stop thinking about whether we would go into coalition
:40:16. > :40:19.with the Lib Dems or anyone else. We are going to win the next
:40:19. > :40:23.election and that is what we will do here at conference this week.
:40:23. > :40:27.you have any objection of going into bed with the Lib Dems after
:40:27. > :40:32.their time in government with the Conservatives? I think it will be
:40:32. > :40:36.difficult because we feel that the Lib Dems have cropped up the right
:40:36. > :40:41.wing Conservative government. They have been handmaiden to decisions
:40:41. > :40:46.that we think have divided Britain, tax cuts for millionaires and some
:40:46. > :40:51.of the other measures they have taken. Resulting in tougher times
:40:51. > :40:55.for families right across Britain, it will be different -- difficult.
:40:55. > :40:59.But I don't think people are thinking about how difficult it
:40:59. > :41:06.will be to go into coalition, they want to hear about what we are
:41:06. > :41:10.going to do. He mentioned that tax cut for millionaires, it is
:41:10. > :41:15.actually a tax cut for people and in �150,000 per year, not every
:41:15. > :41:19.millionaire earns that much. Would net -- Labour go into the next
:41:19. > :41:23.election promising to restore that rate? We have said very clearly
:41:23. > :41:27.that if there was an election tomorrow, our priority would be to
:41:27. > :41:33.make sure that those with the broadest shoulders bear the biggest
:41:33. > :41:36.burden. That means that we would put back at the rate to 50p. That
:41:36. > :41:43.would be the fair thing to do at a time when ordinary families are
:41:43. > :41:49.struggling in Britain. Giving a tax break to those who earn over
:41:49. > :41:55.hundred and �50,000 and for 14,000 millionaires in Britain, that does
:41:55. > :41:59.mean a �40,000 tax cut. 14,000 of them do earn up to a million and
:41:59. > :42:04.they will get the tax break next April. That does not strike us as
:42:04. > :42:07.fair. If it does strike us as being representative of the Tories not
:42:07. > :42:14.generally it reflecting and representing people right across
:42:14. > :42:18.Britain, but having the interest of privilege and wealthy people. We
:42:18. > :42:23.are about representing people in all of the countries of Britain and
:42:23. > :42:27.also trying to represent people on all income scales. What would you
:42:27. > :42:32.spend that extra money on? We are not going to lay out the budget
:42:32. > :42:36.right now. You told me want to put up tax, but you don't know why? You
:42:37. > :42:40.don't know what you spend it on. we have already said there are lots
:42:40. > :42:46.of things we would do to increase demand. We would certainly
:42:46. > :42:51.introduce a holiday for small businesses. We would introduce
:42:51. > :42:56.greater infrastructure spending. We would hold down tuition fees. Some
:42:56. > :42:59.of these things we have attached a specific part of money too. One
:42:59. > :43:03.example we said we would reintroduce the bankers bonus tax
:43:03. > :43:06.and use that money to fund a youth jobs and affordable homes across
:43:06. > :43:12.Britain. Other areas like infrastructure, we would need to
:43:12. > :43:15.look at in the round. It is crucial that we do that. We are winning
:43:15. > :43:19.that economic argument right now. Most people have begun to
:43:19. > :43:24.understand that when we said they were cutting too fast than going
:43:24. > :43:27.too far, they really were. They are taking demand out of the economy
:43:28. > :43:31.and we are seeing less willingness to spend and as a consequence we
:43:31. > :43:36.are borrowing more money and are in a deeper recession than we needed
:43:36. > :43:41.to have been. That has happened on the Tory watch as a result of their
:43:41. > :43:45.policies. You are against tax cuts for millionaires, why did
:43:45. > :43:48.millionaires in Wales get free prescriptions? If we get free
:43:48. > :43:53.prescriptions right across the board because we believe in
:43:53. > :43:57.universal benefits. Even for rich people? There is a good argument to
:43:57. > :44:02.be had. In Scotland it has been raised by the Scottish leader of
:44:02. > :44:05.the party there. It is a legitimate argument to have been a time in
:44:05. > :44:09.which we are cash constrained and in which the difficult decisions
:44:10. > :44:13.have to be taken, but there is something intrinsically valuable
:44:13. > :44:19.about universal benefits which is why Carwyn Jones and the government
:44:19. > :44:24.in Wales cleave to them. They bind us together. They are part of the
:44:24. > :44:27.Gin in society. Everybody pays taxes and everybody has access to
:44:27. > :44:33.those services. That's big society together and I think that is
:44:33. > :44:36.something we should throw away with real, real care. Thank you very
:44:36. > :44:40.much indeed for joining us. That visit from Manchester for the
:44:40. > :44:44.moment. A few days of parlour games still to go.
:44:44. > :44:49.And sure David will make the most of that. Alun Cairns, I will start
:44:49. > :44:53.with you. The key thing there was the response to what Peter Hain had
:44:53. > :44:59.to say. Labour very much flirting with the Lib Dems if you listen to
:44:59. > :45:03.Peter Hain. Are you jealous? Peter Hain is an X Liberal as he would
:45:03. > :45:08.have been in those days. What is significant than what he had said
:45:08. > :45:13.is almost accepting that Labour will not win the next election. He
:45:13. > :45:17.understands, just like the general population, that Labour have not
:45:17. > :45:21.reformed. If you look to their front bench, Ed Balls who was the
:45:21. > :45:24.key adviser to Gordon Brown when he was Prime Minister and Chancellor,
:45:24. > :45:29.one of the architects of the economic failure of the biggest
:45:29. > :45:34.bust we have seen in almost a century, he is still there. He is
:45:34. > :45:40.in a pivotal position. In spite of the opinion polls, if you look at
:45:40. > :45:44.the ratings of Ed Miliband, that still stays with the Conservative
:45:44. > :45:49.Party. If I would like to believe that will be the springboard for
:45:49. > :45:54.which we will fight the next general election campaign.
:45:54. > :46:02.didn't seem to be the message from a Owen Smith, did it? The opinion
:46:02. > :46:07.polls are indicating that Labour is heading for a majority. The there
:46:07. > :46:11.is a long way to go. The problem with talking about the Lib Dems is,
:46:11. > :46:16.we don't even know if they will be the third party in British politics
:46:16. > :46:23.in two-and-a-half years' time. talk about the Lib Dems then?
:46:23. > :46:27.he is an X Lib Dem. What is possibly more likely is, if there
:46:27. > :46:31.wasn't a majority, it might be the case of looking at a deal with the
:46:31. > :46:36.other parties, other than the Lib Dems. The Lib Dems may well be
:46:36. > :46:41.wiped out. Their reputation is toxic at the moment particularly
:46:41. > :46:46.under the leadership of Nick Clegg. Not as toxic air of the big leaders
:46:46. > :46:50.of the Labour Party. Ed Balls is still there. We will see the
:46:50. > :46:55.differences between Ed Balls and Ed Miliband grow further part in the
:46:55. > :46:59.coming years. If that is what we have seen in recent months. I think
:46:59. > :47:06.you are so wrong on that. If anything, Ed Balls at's view that
:47:06. > :47:10.we have been cutting too fast and taking demand out of the economy
:47:10. > :47:13.has been proved right. Ed Balls, at the moment, is at the forefront of
:47:13. > :47:19.what the Tories are thinking that perhaps he was right and we should
:47:19. > :47:23.go down the road of building demand and investment to achieve growth.
:47:23. > :47:27.Plan A still stands as far as the government is concerned? Everyone
:47:27. > :47:33.knows that if you spend more the new UN, you need to cut back and
:47:33. > :47:38.that is what the government are doing. Every body will understand.
:47:38. > :47:42.That is what we are seeking to do from a very low base. Let's look
:47:42. > :47:46.ahead to the conference. Every conference tends to the about the
:47:46. > :47:52.leader whether they are trying to establish themselves or defend
:47:52. > :47:56.attacks. Where does Ed Miliband speech fit into that this week?
:47:56. > :48:01.think he is making an impact and opinion polls show that. They see
:48:01. > :48:05.him as a credible prime minister? If I think he is and that is why
:48:05. > :48:08.they are Tory opinion polls directly on his capacity to be
:48:08. > :48:13.Prime Minister. Why would they do that if they were not fear for he
:48:13. > :48:18.might be the next prime minister? That is what the game is, this
:48:18. > :48:22.ping-pong of politics. Distract from your own economic failures and
:48:22. > :48:26.attacked the credibility of Ed Miliband. I think that shows he is
:48:26. > :48:30.succeeding. How important is his speech for Ed Miliband to persuade
:48:30. > :48:34.people he could be the next prime minister? It is important. He will
:48:34. > :48:38.want to make his case. Economic clear think it is impossible for
:48:38. > :48:42.him to do so because they have not reformed and accepted failures of
:48:42. > :48:46.what they did previously. Also, people still remember that he
:48:46. > :48:53.stabbed his brother in the back to get the main role and he is
:48:53. > :48:57.associated with that. Oh, come on. They if you ask any focus group,
:48:57. > :49:02.public opinion will say that people think he stabbed his brother in the
:49:03. > :49:06.back. As a result, people find it difficult to trust him. If you are
:49:07. > :49:11.prepared to stab your own family in the back. That is the message they
:49:11. > :49:16.want to put out. It was a fair election which he won. With the
:49:16. > :49:20.backing of union support. We will leave it there.
:49:20. > :49:24.Small companies are in danger of being overlooked, according to some
:49:24. > :49:28.business leaders. Ministers denied that anyone will lose out at the
:49:28. > :49:32.they decided that Finance Wales, which were set up to invest in
:49:32. > :49:36.small traders, will no longer be restricted on the size of the
:49:36. > :49:40.business it can invest in. This week saw the UK government
:49:40. > :49:44.announced plans to channel the billion pounds to small and medium
:49:44. > :49:47.enterprises. This chocolate shop might be a
:49:47. > :49:52.treat for those with a sweet tooth, but getting credit and the current
:49:52. > :49:55.environment is leaving a bitter taste than the mouth of its owners.
:49:56. > :50:02.Mal Young says that small companies are finding it difficult to borrow
:50:02. > :50:06.from banks. I started being self- employed in 87, so if you want me
:50:06. > :50:12.to go back that far, if you went to the ban with a sensible business
:50:12. > :50:16.plan, you got to the borrowing. It was very accessible and affordable.
:50:16. > :50:21.It was quite challenging in the late Eighties and early Nineties. I
:50:21. > :50:25.think it is harder now to run a business. It is impossible to get
:50:25. > :50:32.funding for small businesses. shop is an example of a micro
:50:32. > :50:36.business. These account for more than 95% of Welsh companies and are
:50:36. > :50:40.vital to economic growth. If there is a thriving farmers'
:50:40. > :50:44.market, but it is credit markets causing headaches across the
:50:44. > :50:49.country. According to the latest figures, Wales has a higher
:50:49. > :50:53.proportion of companies looking for loans than any other part of the UK.
:50:53. > :50:58.More and more of finding them unattainable or unaffordable.
:50:58. > :51:03.is no doubt in political commitment or solving the problem of financing
:51:03. > :51:08.small businesses. The real question is how do you deliver that? The
:51:08. > :51:12.only mechanism in Wales is Finance Wales. If it seems to do a big --
:51:12. > :51:16.good job in providing funding for large capital acquisitions, but it
:51:16. > :51:20.doesn't seem to do that good in terms of reaching the grass roots
:51:20. > :51:25.businesses, the small micro businesses on the ground. Ministers
:51:25. > :51:27.have decided that Finance Wales, which was set up by the Welsh
:51:27. > :51:32.government specifically to invest in small companies, will no longer
:51:32. > :51:35.have a limit on the size of the business it can invest in.
:51:35. > :51:40.concern for us is that we accept that Finance Wales is the only
:51:40. > :51:45.option we have at the moment. It has had its remit extended to cover
:51:45. > :51:49.large businesses, but ultimately he is supporting if and engaging with
:51:49. > :51:52.small businesses? Who is ensuring that small traders get access to
:51:52. > :51:56.financial products that meet their needs? Finance Wales has welcomed
:51:56. > :52:01.the decision to allow it to no money to a larger businesses. If it
:52:01. > :52:05.says it has a successful track record over the decade of backing
:52:05. > :52:08.growing companies, including �27 million invested in the last
:52:08. > :52:13.financial year. The UK government is also
:52:13. > :52:17.intervening announcing a new business bank that it expects will
:52:17. > :52:22.provide �1 billion to small companies. We do support it, but I
:52:22. > :52:26.think it is a mid-term measure. It is equally important to focus on
:52:26. > :52:30.the transparency and the lending processes of high-street banks
:52:30. > :52:34.right now and the equally important to see how we can grow more
:52:34. > :52:38.alternative forms of finance like peer-to-peer lending. How many
:52:38. > :52:42.announcements have we had in the last two years? We have had monthly
:52:42. > :52:48.announcements and it is not happening. They also saying it will
:52:48. > :52:53.take 18 months to kick in, it is not quick enough. They need to look
:52:53. > :52:58.at reducing VAT. I did not agree with that at first, but it would be
:52:58. > :53:04.quick and easy. If they bought in 17.5 per Saint again, it would put
:53:04. > :53:07.money in people's pockets. Giving the importance of small traders,
:53:07. > :53:11.support for this sector is not something politicians can afford to
:53:11. > :53:15.get wrong. That was Brian Meechan. The Welsh
:53:15. > :53:19.government have told us that a decision to enable Finance Wales to
:53:19. > :53:25.invest in larger companies is intended to provide extra
:53:25. > :53:27.flexibility if ever necessary. It will in no way affect the funds
:53:27. > :53:33.available to Finance Wales to invest in small and medium
:53:33. > :53:40.enterprises, say the government. Mick Antoniw, what of businesses
:53:40. > :53:43.saying? They are struggling to get hold of money. The biggest issue I
:53:43. > :53:48.get from small businesses the failure of application for
:53:48. > :53:52.borrowing from the banking system. They think the figures show that
:53:52. > :53:56.42% of applications for banks support actually failed if and an
:53:56. > :54:00.increase on the previous year. does that suggests more people
:54:00. > :54:03.might turn to Finance Wales and face the same disappointment?
:54:03. > :54:08.makes the more important, but I don't think Finance Wales can ever
:54:08. > :54:14.supplement the role of the bank's, but it is an important contributor.
:54:14. > :54:18.Figures show that 35% of small businesses accessed advice support
:54:18. > :54:23.in one form or another from Welsh government or local authority. It
:54:23. > :54:27.is very important and 330,000 people work in small businesses in
:54:27. > :54:31.Wales so it is essential to the economy. As Mick highlighted, so
:54:31. > :54:34.many people work in small businesses, the Welsh government
:54:34. > :54:40.has to recognise that these could be the driver the of economic
:54:40. > :54:44.growth in Wales. Exactly. I am so sorry that the Labour government
:54:44. > :54:50.many years ago wound up the Welsh Development Agency. That was one of
:54:50. > :54:53.the few quangos that delivered on its objectives. Not only in growing
:54:53. > :54:58.Welsh businesses, which is important, but attracting
:54:58. > :55:02.investment from elsewhere in the UK and beyond here into Wales. If that
:55:02. > :55:08.is a discussion that has had last week between both the UK and was
:55:08. > :55:13.government. Exactly. The problem we have is the obsession with branding.
:55:13. > :55:18.Wales in Japan, Indonesia, Brazil, where to these countries they just
:55:18. > :55:24.about recognise the UK than think of England as the UK. We need to
:55:24. > :55:29.work harder to get a fair slice of the cake. If you look at the number
:55:29. > :55:34.of jobs created in the north-east last year, there were 10,000 jobs
:55:34. > :55:38.attracted through inward investment. In Wales it was less than 2000.
:55:38. > :55:41.That demonstrates the difference where the UK government and regions
:55:41. > :55:44.are responding government and way you have a Welsh governments who is
:55:44. > :55:51.obsessed with blaming the UK government far everything that goes
:55:51. > :55:56.wrong and forgetting what they can control that -- control themselves.
:55:56. > :56:00.We note that Colin Jones met with UK ministers last week he would 0.2
:56:00. > :56:04.collaboration between the two. De you recognise the picture that Alun
:56:04. > :56:11.Cairns paints? I think it is part of the political banter that goes
:56:11. > :56:16.on. 10,000 jobs and the north-east! Economic history very close to ours
:56:16. > :56:20.and in Wales, less than 2000 jobs. That shows the failure in Wales.
:56:20. > :56:25.Let's hear Mick respond. We had the debate last week and what is clear
:56:25. > :56:29.is that Carwyn Jones and the business development team are
:56:29. > :56:33.attracting business from various countries. Carwyn Jones going to
:56:33. > :56:37.India and coming back with �8 million of investments in Wales.
:56:37. > :56:42.That is being expanded. The Welsh Assembly is now being far more
:56:42. > :56:46.proactive in identifying foreign investment. We will be back with
:56:46. > :56:56.you before the end of the programme. Time for a quick look back at the
:56:56. > :56:59.
:56:59. > :57:03.The first minister said international transport links were
:57:03. > :57:07.essential to economic growth. Speaking at the was government
:57:07. > :57:12.Council for economic renewal, Carwyn Jones said he wanted Cardiff
:57:12. > :57:15.airport to be a well-connected success.
:57:15. > :57:18.For delegates at the Liberal Democrat conference voted
:57:18. > :57:23.overwhelmingly against the introduction of regional pay rates
:57:23. > :57:26.for public-sector workers. The Welsh minister warns that the
:57:26. > :57:31.coalition government colleagues that she would fight any expansion
:57:32. > :57:36.of the policy in the public sector. Chris Bryant said the new TV
:57:36. > :57:40.reality show, the valleys, was patronising and upsetting. It
:57:40. > :57:44.follows nine young people from across south Wales. The broadcaster
:57:44. > :57:49.said the programme celebrated young people and was not about
:57:49. > :57:53.stereotyping. The Conservative leader in the
:57:53. > :58:03.assembly accuse the first minister of pantomime politics. Oh no he
:58:03. > :58:05.
:58:05. > :58:11.I will play the role of the wicked stepmother. Alun Cairns, a final
:58:11. > :58:15.word. That was what you were hinting at earlier. Precisely,
:58:15. > :58:18.pantomime politics. The easiest thing is to blame the Westminster
:58:18. > :58:23.government, that if you compare development to English regions to
:58:23. > :58:27.that that is not going on in Wales, the responsibility lies firmly at
:58:28. > :58:32.his door. This the first minister not have anything to blame the UK
:58:32. > :58:37.government for? I think there is an awful lot. Just look at the balance
:58:37. > :58:42.of trade. Last month, the equivalent period, �2 billion
:58:42. > :58:47.deficit, this year, �20 billion deficit. The country is being run
:58:47. > :58:52.into bankruptcy by the UK coalition government. Of course it impacts on
:58:52. > :58:56.Wales, you can't avoid that. Let's look at where Wales has complete
:58:56. > :59:00.responsibility and that his health care. Waiting times are longer,
:59:00. > :59:08.infection rates are higher, if you have cancer in Wales, you won't get
:59:09. > :59:14.access to drugs, that is where they are responsible. I'm struggling to
:59:14. > :59:18.find facts. The facts are that if you have a serious illness, you
:59:18. > :59:22.have a better chance of survival in England than in Wales. It is
:59:22. > :59:27.something that comes up at my surgery is to regularly. I think
:59:27. > :59:30.that is absolute rubbish. Thing England you now have 24 major
:59:30. > :59:34.hospitals on the brink of administration because they are
:59:34. > :59:38.being private eyes. Look at the performance, waiting times,
:59:38. > :59:44.infection rates, those are the key. Let's leave that for the moment.
:59:44. > :59:48.Before we go, a words on your assembly colleague, Keith Davies.
:59:48. > :59:53.We are all saddened. We heard the news that he had gone into the