05/10/2016 The Wales Report


Huw Edwards takes a look at issues that matter in Wales. What does Brexit mean for Wales? The programme speaks to first minister Carwyn Jones.

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And, in a new series, there will be no seed for Wales and the Brexit


negotiating table so how will Welsh interest to be protected in the


years ahead? I will ask the First Minister for his plans for Welsh


life outside the EU. Stay with us. Welcome to a new series of the Wales


Report and it could not be happening at a more important time in the


political life of Wales. We know that the process of leaving the


European Union, backed by Welsh voters will, will start in March


next year, and we also know, thanks to a blunt message from Theresa May


that there will be no formal place for Wales at the Brexit negotiating


table, or any of the other devolved nations. What does Carwyn Jones make


of that? And you can join in using our hash tag on social media. Before


we spoke to Carwyn Jones we asked a prominent Welsh economist to outline


the challenges of Brexit for Wales as he sees them. Leaving the UK have


enormous implications. We have 40 years worth of secondary


legislation, foreign policy, commercial policy, which we are now


having to overturn. We either have to recreate it or replace it. It is


a big deal. One can think of for quite separate areas where it could


have a first or the effect. One is resource flows to Wales. We know


that the European Union in structural funds alone provides ?1.8


billion over six years, ?300 million per year, 2% of the total Welsh


budget. Maybe one fifth of its capital budget. Will those fun to be


replaced by the British government? Big question. I don't know that I


would be all that confident of it, frankly. Trade is another area, will


we have free access to the single market or not? Will there be


tariffs? Nontariff barriers? That is not all bad, actually, on the trade


side because the biggest Welsh export market is the USA. And there


are many progressive companies in Wales that are selling to the third


World, Africa, and Asia. They will probably benefit because we have


already seen the pound down as a result of Brexit and my view is it


will go lower. When you come to foreign investment I think that it


is easier to see that we have got the wind in our face. This will be


able to hold. Many of the companies that we are able to attract into


Wales were looking to sail into the European market. Maybe they can


continue to do so. Maybe it won't be much worse. But it certainly won't


be any better. And finally there is the whole issue of regulation. Many


people have hopes that leaving Europe will enable us to dispense


with red tape. I am afraid that I think that is a very exaggerated


hope. I think Carwyn Jones has said the right things. His hand is


weakened by the fact that the Welsh electorate voted to leave. If he was


sitting on the Northern Ireland or the Scotland vote he could say,


look, we didn't vote for this. As it is he has a bit of a problem that we


are in the same bag as England, and she has to deal with that political


fact. I think that there was a case for having a minister, or some


senior person with full-time responsibility foreshadowing the


Brexit discussions. They seem sufficiently complex and


wide-ranging to me that having somebody with a political


responsibility keeping an eye on it all the time, I would have thought


there was a case for that. There is a major problem of coordination. The


responsibilities will run across departments. I hope and that things


are improving but certainly historically it has been a weakness


for the Welsh Government. Ministerial responsibilities taken


very seriously, but tending to be silent. That was the economist Jerry


Houlton giving us his sense of the challenges ahead. The First Minister


is with me, thanks for joining us, we will chat in a second but what we


should do at this point is remind ourselves of what the Prime Minister


has been saying in Birmingham this week, specifically in a Welsh


context. I was very pleased that one of my early visits as Prime Minister


in July was to Cardiff, and I sat down with the First Minister and


talked with the Secretary of State about how we would involve the Welsh


Government in the discussions that we have. Of course it will be the UK


that is negotiating with the EU in terms of the terms of Brexit, I want


to make a real success of it, but in doing our preparations I want to


listen to the devolved administrations, and here the


particular issues in different parts of the UK. So that they are fully


engaged and will continue to be. As we go through the negotiations we


need to ensure we get the right deal for Britain. That is what I want to


do. But alongside that there are real opportunities for the UK as we


leave the EU and we have opportunities for trade around the


world, so I will be looking at developing those opportunities as


well. We're going to make a real success of leaving the EU so there


will be some tough negotiations, they will take time and there will


not be a running commentary on the negotiations, but as we do that we


will be looking at the opportunities we can have, and one of the things I


have been absolutely clear about, it is my vision for the government that


I lead, it would be a government that works for everyone and not just


a privileged few. We need to look at the opportunities that we can see


around the world. And we need to look at how we can ensure that we


are providing support where it is necessary, we have already been


clear in terms of agriculture that we will continue in terms of the


financial support, certain financial support that farmers are getting, up


until 2020, but we need to talk to them about what will then becoming


ever after. It gives us an opportunity, it gives us the


control, that is one of the key issues, a lotta people when they


voted to leave the EU it was about not having control over their lives,


and as the British government we will be the ones who are able to


make decisions about how we ensure that the economy is working for


everyone across the country and society is working for everyone


across the country. That was the Prime Minister speaking in


Birmingham just a few days ago and of course she had a big speech to


deliver today at the conference, thank you for joining us, First


Minister, lots of April are concerned when they realised


suddenly that those negotiations are happening at the EU, on the Brexit


process, there will not be a formal role for Wales. That must bother


you. We had been promised engagement and consultation but what does it


mean in reality? There is a template for this. When I was agricultural


minister we would meet on a regular basis, with the four MAC


governments, sitting down and working out respective positions


when discussions took place at European level. I expect that to be


put in place. It is right to say that the UK Government will carry


out the negotiations, that is true, it is in the driving seat, but in


all seriousness the UK Government cannot be thinking that it wants to


have an agreement that is opposed by Scotland, Wales, and in Northern


Ireland, where there are major issues that need to be resolved, so


the wider the buy in surely the better it is. I will remind you of


what you said not so long ago, if this becomes a two-way dialogue


between Brussels and London it will fail. Cardiff, Edinburgh, and


Belfast must also have seats at the table. At the table, for most


people, would involve being in the room with people like Boris Johnson,


Liam Fox, and who ever else, and that is not now going to happen, so


I wonder if you think we are heading for failure in that sense? We will


continue to talk to the commission ourselves. And we've been talking to


Gibraltar, they have a particular about what it might mean for them.


So from my perspective I'm saying that we expect to be part, not of...


Not expecting to be told what is happening, but to be able to feed


into what the UK position actually is, and to my mind that there should


be ratification by all the parliament within the UK, the


difficulty we have is the UK Government has no real idea of where


it goes next, the hardline supporters of Brexit, their promises


are now disappearing, and were seen blind panic. In some sections of the


UK Government. It needs to get it act together and explain to the


people of Britain exactly what the red line is in negotiations, and


explain what it sees as the best outcome for Britain. We have not had


that so far. There is no sense from any of the ministers that there


should be ratification, as you call it, from the devolved parliaments,


there is no sense of that, is that your understanding? Are you


expecting this to be a formal ratification process? Because I


don't think they are. They are already in trouble over the


triggering of the article 50 process with court challenges in Northern


Ireland. It makes perfect rational sense for there to be as much by in


as possible. If you look at Northern Ireland for example, EU membership


is an integral part of the peace process. Will they really impose a


settlement in the teeth of problems in Northern Ireland? It makes no


sense at all. So far so good from the UK Government, what they promise


of engagement, we expected to be real, not coming back later saying,


this is what we agreed for the City of London, but and manufacturing are


not so important. Because there are elements of the UK Government that


actually believe that. That put it another way. You make your case in


terms of the consultation process that the prime and star has


mentioned. You then have to have faith that those views will be taken


in to the formal negotiations on Braxton, and that will be Liam


Johnson and David Davis, so how can Welsh people have faith that the


Welsh interest will be at heart? And secondly, what will you do if you


don't dig you are getting the kind of purchase that you need? I will


say so, and say to the people of Wales, we need the UK Government to


insure that there is a Welsh voice. We will make common cause with the


other devolved administrations where we can. It is not just about


politics. There is a sense to this. If you look at farming and


fisheries, they are both areas where the UK Government has effectively no


role in Scotland, Wales, Northern Ireland. They cannot do all the


negotiating on our behalf then present us with a fake company. We


need an input. So far they have said it will happen. They have not said


the door is shut to Scotland, Wales, Northern Ireland, and Gibraltar.


Have had the promise of engagement and it is time to make good on that


promise. But before we even get to that position and to understand


exactly what their position is in terms of any negotiation. Liam Fox


is saying, hey presto, at the we will unveil a load of free trade


agreements. The miraculous, it has never been done in human history in


that period of time. David Davis has said, it does not matter if we have


tariffs, ?2 billion to the Exchequer, paid for by the consumer,


Joe Public, and disastrous for manufacturing. My greatest fear is


that they will focus on the City of London to get a good enough for the


city at the expense of other sectors of the economy, and that, clearly,


for Wales, is problematic. On the single market, because this is right


at the heart of economic or it and is very important for Wales as well,


is the opposition now that you can buy an outcome which is basically


saying we will not be having full membership, formal membership of the


single market, that we will have some kind of access to it, some


negotiated access, would that you be a good outcome, or just unacceptable


outcome or, what is the ideal? The red line for me is no tariffs. Any


outcome that lead to tariffs is bad. It will mean of course that it makes


it impossible for us to say, and this has been a fantastic success, a


successful route we have taken, it will be impossible for us to say to


investors, come to Wales because you have access to the European market


which is bigger than America and Russia combined. If we have tariffs


of the investment will go elsewhere. So tariff free access is absolutely


essential, anything else has to be built on top of that. But without


that, no agreement will be worth the salt.


Big you think it will be worth, in terms of the concerns over freedom


of movement, you think seeding membership of the single market is


worth it in order to have control over freedom of movement? No, I


think we should have access to this angle market. Where are you on


freedom of movement? Noah has the answers to this yet, one of the


areas it could be, for example, there could be as seven hyping year


moratorium on freedom of movement as it currently stands, in order to get


other countries time to catch up. That's one possibility. While we


reckon as we do need to move back in for, is it possible to have freedom


of workers rather than freedom of people? So if there is a job in the


UK, they can move freely. These are all things that can be explored. At


the heart of this is that people had no control over their lives, and


people were taking jobs that may be made available to them. That issue


has to be addressed, whether it's correct or not. It is important we


say to people, people are coming here to pay taxes and patented the


health service, they're not taking jobs that could be done by local


people. To what extent have you been successful telling people that there


is, clearly, an advantage to being open to workers from other parts of


the EU and the world, that that is very important aspect of of


movement, is that a aspect you are moving away from? I made it


absolutely clear that there is no country in the developed world that


doesn't draw doctors from other countries. It's world market. The


idea you can only have UK doctors is nonsensical. The Government in


London is talking about cell sufficiency? It's crazy, it can't


happen. It takes at least ten years to train someone to the level of


consultant. I want the best doctors working in the health service, I


don't care where they're from. I want the best with people of Wales.


The message that the Government in England is giving is that you can


come and work for us, but when we have had enough of you, we will chug


you out. That is a great way of attracting the best brains. They are


now proposing a list of foreign workers. That is the most sinister


thing I have heard. She said it was possibly a knowledge, not formal


policy. In other words, I said it, and that I regret saying it. This


list, is this the 1930s? It is a crazy situation. As public sector


employers in Wales, we will not be doing that. You will not be doing


that, but you're still acknowledging that there are concerns around


freedom of movement which bed into the result in Wales over the


referendum. There are two messages here just as you are concerned over


uncontrolled freedom of movement? I'm not concerned over freedom of


movement of doctors and nurses. In fact, I wanted the best people


coming from abroad into Wales. There are plenty of firms in Wales? They


will bring their own people in, that is crucial. We are saying to


companies you can't employ anyone outside the UK? So what is the


freedom of movement that you do want to control? It is the low-pay that


is the issue. People who are in jobs where they feel they are badly paid


and had no security of employment, no pension at the end of it. They


are under pressure of their incomes due to the fact that the businesses


can employ other people in the areas where they work, that has brought


pressures on wages. I have heard that and it is true in the terms of


the low paid, it is not true on the other end of the spectrum. What


would be your message to those ministers in London on freedom of


movement? The last thing we want is to restrict doctors and nurses


coming into the UK, we've always relied on them and training doesn't


work in itself. You can train doctors, but they may go to other


countries. What about foreign students? We want them here, white?


They pay higher tuition fees then well students do. If they do not


come here, tuition fees will come up for home students. Warren students


subsidise the education of UK students, that's the reality. We


want to bring the best brains into Wales and into Britain, because


other people who were pure people in the future and set up businesses in


the future if they choose to stay in Britain. Working with the people we


already have here. The Home Secretary has spoken about people


with lower-quality altercations, in Wales, that would mean distinction


between our universities, is that healthy? No. We need to make sure


that the courses offered sufficient standard. Is that the case in Wales?


We have very good universities in Wales. Across-the-board? Foreign


students coming to Wales, and there are advantages there. If you look at


it purely financially, they pay more. If you look at what they can


contribute, they bring in their own knowledge. Also, if the come to


Wales and study and return to their home countries, they're ambassadors


for Wales. I've met people all around the world he came to


university here, have a great memory of that, and positions where they


can take decisions about jobs in different parts of the world. If we


cut ourselves off from that, and cut ourselves off from so much in terms


of being sale the macro able to sell Wales around the world. We had the


chance at this work document turbulence, a roller-coaster right,


the Autumn Statement coming up could be a bigger squeeze possibly on


public steam the macro spending. What is your strategy around


spending? We have to see what the Autumn Statement actually says. I


welcome moving away from this scripture is of austerity, if I can


put it that way. The Robbie decisions we have to take. --


strictures of austerity. We had five years between 2011 and 2016 where


there was no products that we broke. It was not easy to do that. -- no


promise that we broke. We want, at all costs, to avoid the temptation


that afflict all politicians to make promises we couldn't keep. In our


manifesto, we made sure we could keep our promises, it even bearing


in mind the squeeze coming down the line from Whitehall. The IFS by


saying there could be a real terms reduction of several% of the funding


that comes to the Welsh Government. What are going to be your spending


parties? What we can't do is salami slice, that is not strategic or make


sense. What we have to do is look carefully at our budget and take


strategic decisions on what we want to fund. Simply cutting bits here


and there is not going to work. It doesn't make sense in terms of what


we're trying to do to make Wales a better place. The Prime Minister's


case today is that health spending in Wales has compared unfavourably


compare to England and has performed unfavourably compare to England,


that is their experience, what is your thoughts? First law, it is not


even true. We spend more on health in Wales and England does per head.


That is a fact. We know that when the different health services in the


UK were like that, there were no substantial differences. Whenever


anybody wants to criticise Government elsewhere it is a sure


sign they are in trouble. This cannot be solved by deporting


doctors. They are now saying to doctors who work in Britain, you can


stay here for a while, then we will chuck you out. That is effectively


what they were saying. I've following to the same trap, because


I've accused them of something. From our perspective, we are happy with


the health service and the money we have put into it. We know it


delivers for the vast majority of people, day in, day out. It is a


question of focusing on those errors. Are you happy with the


current Labour leadership, another Jeremy Corbyn's been re-elected and


people are retractable behind, you also pulling behind him? Yes, it is


vitally important the party in Westminster actors opposition. Is


not doing that now? Adam Taggart has been. -- I don't think it has been.


People in the party have different views, but those views are expressed


in a friendly way. We came through the last election with 29 seats,


though we were told we would have far fewer than that. We won every


seat in a labour force as Tory straight fight. The objective


politics is not to transform a political party, it is to deliver


for the people who voted for you. The people voted Labour want to note


the Labour Party in Westminster will stand up for justice and


opportunity. We haven't done that. We haven't done that up to now, so


it is important we unite as a party and start to be an effective


opposition. When you choose one to represent Wales on the executive


committee, you chose Alan Davies. Hidden the past he has been on


record as not being impressed with Jeremy Corbyn. Where did you do


that? Firstly, the gravitas to do the job. He has availability for the


time in the NEC meets, so I know he will be able to do the job. I am


told that Jeremy Corbyn felt he was not the ideal choice because it was


not I ideological eat sympathetic to what the leadership is trying to


achieve? In my judgment, ie had to pick who would speak for Welsh


Labour. Per semester, thank you very much. That's all we have time for,


don't forget if you want to e-mail us, the address is... From now, from


the Senedd in Cardiff Bay, thanks for watching.


The Wales Report with Huw Edwards returns for a fifth series on BBC One Wales. In the first programme of the new series - what does Brexit mean for Wales? The programme speaks to first minister Carwyn Jones.

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