A NATIONAL BANK OF WALES

A Plaid Cymru government will seek to establish a National Bank of Wales (NBW), a publicly-owned bank similar to the German Landeskreditbanken, providing debt finance to Welsh businesses and taking longer-term equity stakes to help plug the estimated funding gap of £500m a year faced by Welsh SMEs. Finance Wales operations will be merged into new institution.

This institution will work with Welsh Government and the new WDA to grow Welsh Mittelstand companies; it will in particular offer succession and equity release planning specialists, involving the use of management buyouts and employee ownership trusts, and the adoption of long-term equity stakes as a public bank, providing a source of patient finance on the German model in successful Welsh companies in order to maintain Welsh ownership, preventing the ownership churn that has damaged so many successful Welsh companies, and therefore safeguarding jobs.

The term Mittelstand mostly applies to small to mid-sized firms in German speaking countries. Most importantly Mittelstand companies are characterized by a common set of values and management practices. What defines the Mittelstand, is a broad set of values such as: Family-like corporate culture; long-term focus; independence; nimbleness; emotional attachment, investment into the workforce; flexibility; innovativeness; customer focus; social responsibility; strong regional ties.

The owner or owners take the business decisions largely on their own – and assume the risks and liability. In these companies, the boss usually has close ties with the business and the employees and bears a particular responsibility for ensuring job security. Mittelstand companies are often hailed for providing the backbone of the world’s fourth-largest economy. They tend to be family-owned, tucked away in small towns and familiar only to the businesses that buy their specialised machinery and components.

The Mittelstand also appears to offer a solution to some of the biggest worries of the capitalist system. One being the centralisation of wealth and the other is unemployment. The combination of medium-sized companies with deep local roots and a strong apprenticeship system means that in Germany only 7.8% of those aged 25 or under are unemployed, compared with 22.1% in Sweden and 54% in Spain. Mittelstand firms inspire extraordinary loyalty in their workers: on average only 2.7% of them leave each year, compared with the 30% turnover at some big American companies.

Over time NBW will develop into a deposit taking institution, involved in mainstream business banking, and providing banking facilities to the Welsh public sector, allowing it to use fractional reserve banking to expand its lending capacity. It will separately create a series of sector specific and independently managed seed and risk capital funds for high-growth innovation-based businesses.

Plaid Cymru will also look to build on the work of the Sector Panels, Industry Wales and other existing industry fora to support the development of sector associations to help us develop strategies in every area of the economy. We will do everything we can to support the steel industry in Wales, pressing the UK Government and EU to take radical action to protects the industry from unfair competition, procuring Welsh steel wherever possible as part of our infrastructure investment programme and actively exploring the possibility of a joint venture investment to improve the long-term competitiveness of the Port Talbot steelworks.

NEWPORT'S CHARTIST MURAL DESTROYED!

And end to childhood memories in Newport

The destruction of the popular Chartist mural, just off John Frost Square (in Newport) today has robbed many Newport residents of part of their personal and cultural history. I have fond memories of walking past the mural as child with my grandmother and being fascinated by it. Now its gone, reduced to rubble on the (relative) quiet by a by the Labour Party in Newport, which was anxious to avoid embarrassing scenes at a demo planned for the weekend.

The pathetic excuses made by Labour in Newport and their refusal to engage and find a way to save the mural just about sums up the way the town of Newport has been treated over the years. Few people are against development or redevelopment but it needs to be sustainable and sympathetic to the needs of the town. The failure to work with local indigenous small businesses in and around Newport is a reality that has done great economic damage to the local economy and has weakened our economy.

We have to do something different, yet another shopping centre, which promises much but may well deliver little of lasting benefit, exactly as did the Kingsway Shopping Centre (in the 1970's).  Any shopping development should contain retail opportunities for small local businesses as money spent in local businesses circulates three times as long as money spent in 'UK national chains. Simply filling the development with chains means that what local money is spent will get hoovered up and vanished out of town as rapidly as possible. Various attempts to develop or redevelop Newport over the years, largely via the questionable vehicle of Newport Unlimited (more like 'Newport limited') have failed to deliver lasting economic growth. Planned local council cuts of some £34 million pounds won't help, but, neither will a complete lack of vision and the contempt which has been demonstrated for the towns inhabitants today.

JOB CREATING POWERS COULD TRANSFORM WALES

Plaid has welcomed the Western Mail poll which show that the vast majority of Welsh voters support the devolution of tax-varying powers to Wales.

Plaid Cymru Leader Leanne Wood AM said;

"The fact that a clear majority want to see the transfer of these powers to our nation is very positive news.

“Plaid Cymru's submission to the Silk Commission has called for the Welsh Government to be able to set Welsh income tax rates.

“Having these powers in Wales would give us more tools to focus on economic growth and the creation of more jobs that would then increase the tax base.

“Surely any self-respecting Welsh Government would prefer to have control over these job-creating levers rather than see them remain in the hands of a remote government in Westminster which doesn't place the economic well-being of our nation as a priority or even an after thought.

"People are saying clearly that they want our nation to take greater control over the economic tools that can help to improve our lives. The First Minister and his Labour Government now have a big decision to make - the choice is between taking responsibility for ourselves or to continue to blame others; the choice is between home rule or continued Tory rule."

POOR WEST BRITONS?

I was wondering the other day whether or not there is a plan for Wales or no doubt West Britain as its called in the darkest reaches of Whitehall. I wonder this because we have two tier planning system within Wales, by this I mean local (county borough) level and UK national level. Planned large scale housing developments in the north east are designed to deal with housing shortages in Merseyside, while those in the south east around Newport appear to exist largely to fill the projected housing gap in the Bristol area.

The planning appeal system, appears to favour the developers (at local people's expense). The planning process in Wales is confusing and designed to work, as far as I can see in a non-devolved planning environment. There appears to be no specific holistic joined up housing plan for Wales, other than to carry on approving housing developments that bring scant benefit to local people and local communities - certainly not cheap affordable housing.

Local democracy on a county borough level has been undermined, as developers (and here we are not just talking about housing) simply appear to me to carry on appealing until they get their way or get their development retrospectively approved at a higher level. Local government officers will (and do)advise local councillors not to turn down developments (whatever the grounds) because the developers will appeal until the cows come home and that local government just does not have.

We appear as far as I can see to be short of plans for Wales for housing, energy and economic development and many other areas. The last national assembly coalition government at least attempted to try and do so something different, when it came to housing, economic development and our infrastructure. The current New Labour government appear to be content to do nothing (as Labour at many levels of government in Wales have done for years) until new Labour is back in power in Westminster and are (as far as I can see) quite happy to remain poor West Britons.

CHEQUE BOOK COLONIALISM?

The acquisition of land by multi nationals for development or to acquire resources at the expense of local people is bound to be a touchy subject especially when little medium to long term sustainable benefit is delivered to the indigenous inhabitants. We in Wales, ironically, should know about this having been at the sharp end ourselves when it comes to the exploration our natural resources and have been largely peripheral to any benefits received.

What's happening now in Africa is subtly different, there is a race going on between multi national companies on one hand and the emerging economic giant of the Peoples Republic of China on the other hand to acquire land, not so much for the minerals (although that is a factor) but to acquire the ability to grow food. An interesting report (produced by the Oakland Institute) has noted that Hedge funds are now getting involved in acquiring land in Africa to produce food and biofuels, which will all boost their profits.

The report notes that foreign firms and hedge funds) have been quietly purchasing large chunks of land in Africa, often without any proper contracts and that this activity has led to the displacement of millions of small farmers, who are losing out as multi national firms try to secure their hold of the global food markets. Food production is often sacrificed to make space for cash crops for export, including flowers and biofuels, which fetch a tidy profit.

Since 2009 foreign firms the report notes that have acquired land equivalent to the size of France (nearly 60 million hectares) from questionable but lucrative deals with a combination of gullible traditional leaders or corrupt government officials in in Ethiopia, Tanzania, South Sudan, Sierra Leone, Mali and Mozambique. No doubt the foreign firms make many promises of progress, development and jobs to local chiefs, but they don't necessarily come close to delivering on the promises.

Investors benefit with a wide range of incentives written into their contracts from unlimited water rights to tax waivers, but, are clearly not there to help feed starving Africans. Sounds familiar doesn't it - not that much of step from the old days of the WDA throwing wads of cash of foreign investors, who got all sorts of benefits (grants and incentives), promised much (I seem to recall the magic figure of 6,000 jobs kept cropping up in the 1980's, 1990s and early 2000's) yet in the end never quite delivered all that was promised.

As we stand on the brink of what has been aptly described as the Age of Scarcity - a combination of peak oil, climate change and financial instability not to mention food security and fuel security, we should all take note of this developments in Africa and look closer to home when it comes to the development of secure energy and food supplies and particularly take note of the issue of ownership.

HOMEGROWN SME'S V BRANCH OFFICE DEVELOPMENTS

Small businesses play a significant role at the heart of our communities; they create wealth and sustainable employment opportunities for local people. Profits and investments made by them tend to stay within the communities where they are based. For too many years economic development in Wales has been focused on large scale development of what can be best described a single egg solutions, which promise much and deliver significantly less, the focus should be on developing small to medium size local businesses, which are significantly less likely to up sticks and leave for perceived greener pastures and fresh applications of development grants.

This focus on attracting large scale single enterprises, which promise much but deliver significantly less than anticipated. The LG development near Newport, is a good example of an expensive disaster / fiasco [please take your pick] which promised the usual total of 6,000 jobs - accrued significant public funding - which was committed by the then Welsh Secretary, William Hague, yet never delivered anything like what was promised. While anyone (even a Tory) with half a brain or even half an understanding of the state of the Korean and the Far Eastern economies at the time that and a basic understanding of where technological developments in relation to PC monitor screens were going, would have put their hands up and said hang on a moment.

A combination of what can best be described as fantasy island economic assessments, a fatally flawed business case and a forthcoming Westminster election led to one of the spectacularly duller decisions of recent years being made, something that ended up costing us millions of pounds worth of public money. The WDA has in truth not really consistently delivered anything like long term economic stability and much needed long term job opportunities to our communities that it should have done.

European funding opportunities have been seriously wasted, where are the physical assets, by which I mean the things you can literally put your hand on like improved communications (rail and road), broadband infrastructure, etc - that bring long term benefits to our communities. How much money has been scammed (and scammed may be the key word) into dubious training programmes and questionable educations programmes that fail to deliver the necessary skills that workers and potential workers need to make a decent living in the modern economy?

The Plaid driven One Wales Government has made significant efforts and attempts to think and act differently when it comes to economic development and support for small to medium sized enterprises, which are the only real thing that will put wealth into our communities, and develop and sustain longer term employment possibilities. Attracting branch factory operations of a relative short term duration does not help develop our economy - we really do need to think differently and focus economic development priorities on smaller local businesses who will be rooted in our communities and offer more flexible employment opportunities.

The Federation of Small Businesses (FSB) has noted that the UK is losing 2,000 local shops every year and that of this rate of loss continues then by 2015, less than 5 years hence, there will be no independent retailers left in business, something that will badly hit both consumers and our communities hard as they lose any real choice in the marketplace and lose potential job opportunities. Over the last twenty years the commercial hearts of many of our communities have been seriously damaged as a result of a combination of aggressive policies pursued by the larger retail chains and exceptionally poor decision making on the part of local government and central government indifference.

When combined with the rapid growth of unsustainable, ill-thought out and more than questionable out of town and edge of town retail developments which leave next to no place for the smaller local businesses and retailers and deprive consumers of real choice. When you factor in parking charges, business rates and the effect of the closure of high street banks and post offices in many of our communities and you begin to see why many of our smaller businesses and local shopping centres are up against it. Local small businesses as well as trading with us the consumers, also trade with each other - so the community gets twice the benefit. Money spent by and in local businesses spends on average three times longer in the local economy than that spent with chain stores which is instantly lost to the local economy which in times of recession our communities can ill afford.

The Welsh Assembly Government's Green jobs Strategy is a welcome step in the right direction but clearly more needs to be done. The National Assembly needs to have the power to vary business taxes in order to help boost our businesses, as well as encourage investment in skills and the tools of their businesses and their workers. If we are going to make Wales a nation of aspiring entrepreneurs and to encourage and enable them, our communities and our economy to flourish we need to encourage the development of community owned social enterprises.

The Rowlands review into the provision of growth capital was most welcome; it recognised that an economical vibrant SME sector is vital for economic growth. There has been a lack of provision for companies in Wales who are looking for between £2 and £10 million pounds in capital, this has to change if we are to encourage sustainable economic growth and development.

It’s pretty clear that the present financial market and its institutions have failed over recent years to supply sufficient venture capital for the SME sector in Wales. We need a venture capital fund for Wales, which should be established by, but independent of the Welsh Assembly Government. Such an independent venture capital fund could raise capital and deliver investment through a co-investment model, with approved private sector partners to our SME sector, where such investment would make a real difference.

More of the same old twaddle from Whitehall and Cathays won't do at all, vastly expensive one egg, one basket schemes to generate the seemingly standard 6,000 jobs, just won't do. And speaking of twaddle, which was all that we were offered by the London based political parties, what we need is fresh thinking and action from the new government - more than just talk, we need some concrete steps to encourage growth, boost manufacturing industry, support our small to medium sized enterprises and an end to the business rates and that's just to start with... otherwise it will just be a case of same old, same old with ill thought out out public sector cuts which will do nothing to boost our communities and our economy.

THE TOOLS TO DO THE JOB

The Plaid driven one Wales Government is doing its best with limited powers, but, it still has one hand effectively tied behind its back by London based Government which appears, even after the greed induced stupidity fed banking crisis still appears to value the City and the Square mile above of all else. If we want to make things better then we need to fundamentally review economic policy and help to develop the local workforce’s skills which will help create the economic climate where local firms can develop, grow and prosper develop long-term sustainable economic prosperity and long-term employment in our communities and to do this Wales need more control of economic decision making.

There is a profound need to target economic policy on a regional basis across Wales, so that everyone benefits, not only those living immediately alongside the M4 corridor. The Plaid driven one Wales Government needs to help grow our small to medium enterprise (SME) sector, side by side with supporting the re-skilling of the workforce, if we do this then we can secure sustainable, long term economic growth and employment, if we don’t then we may slip back to boom and bust.

We are still facing a major economic challenge as large production companies see Eastern Europe (and beyond) as a cheaper location. Our rural industries, as well as those inside the traditional industrial heartland are especially vulnerable, as their economic viability is brought into question by a variety of reasons, including the astronomical rise in fuel and energy costs, the economic power of the supermarkets, European regulations on waste disposal, and the issues surrounding food imports as many companies are operating on somewhat slender profit margins.

One of the lessons that can be learned from Ireland is that a workforce’s skills are still fundamental to the success of a country’s economy and to economic development. Ireland was able to use use a third of its European funding to educate its workforce with new skills, as long as we are unable to do this here in Wales then our small businesses and our workforce will be disadvantaged. In Ireland the lower corporation tax was key component in attracting international investment.

Between 1972 and 2002 the Irish economy grew, on average, by 5% a year whilst the growth of the Welsh economy was less than 2% a year. In planning our economic future, we need hands on rather than hands off; it is vital that we look to our own resources and specifically to developing the SME sized businesses. Our local businesses, rather than multi national firms are much less likely to pack up and leave Wales for the cheaper labour markets of Eastern Europe and Asia.

GOOD FOR BUSINESS, GOOD FOR US

Small businesses are a vital part of our communities; they create wealth and sustainable employment opportunities for local people within our communities. For far too long economic development in Wales has been focused on large scale development of what can be best described a single egg solutions, which promise much and deliver significantly less, the focus should be on developing small to medium size local businesses, which are significantly less likely to up sticks and leave for perceived greener pastures and fresh applications of development grants.

There has been far too much focus on attracting large scale single enterprises, which promise much but deliver significantly less, the expensive disaster / fiasco [take your pick] promised a spectacular total of 6,000 jobs - significant public funding was committed by the then Welsh Secretary, William Hague, it never delivered. Anyone with half a brain or even half an understanding of the state of the Korean and the Far Eastern economies at the time that and a basic understanding of where technological developments in relation to PC monitor screens were going, would have put their hand up.

A combination fantasy island economic assessments, a fatally flawed business case and a forthcoming Westminster election led to one of the duller decisions of recent years being made, something that ended up costing us millions of pounds worth of public money. The WDA has in truth not really delivered anything like long term economic stability and Long term job opportunities to our communities.

European funding opportunities have been wasted, where are the physical assets, by which I mean the things you can literally put your hand on like improved communications (rail and road), broadband infrastructure, etc that bring long term benefits to our communities. How much money has been scammed into dubious training programmes and questionable educations programmes that fail to deliver the skills out workers and potential workers need to make a decent living in the modern economy?

The Plaid driven One Wales Government has attempted to think and act differently when it comes to economic development and support for small to medium sized enterprises, which are the only real thing that will put wealth into our communities, and develop and sustain longer term employment possibilities. Attracting branch factory operations of a relative short term duration does not help develop our economy - we really do need to think differently and focus economic development priorities on smaller local businesses who will be rooted in our communities and offer more flexible employment opportunities.

The Federation of Small Businesses (FSB) noted that the UK is losing 2,000 local shops every year and that of this rate of loss continues then by 2015, less than 5 years hence, there will be no independent retailers left in business, something that will badly hit both consumers and our communities hard as they lose any real choice in the marketplace and lose potential job opportunities. Over the last twenty years the commercial hearts of many of our communities have been seriously damaged as a result of a combination of aggressive policies pursued by the larger retail chains and exceptionally poor decision making on the part of local government and central government indifference.

When combined with the rapid growth of unsustainable, ill-thought out and more than questionable out of town and edge of town retail developments which leave next to no place for the smaller local businesses and retailers and deprive consumers of real choice. When you factor in parking charges, business rates and the effect of the closure of high street banks and post offices in many of our communities and you begin to see why many of our smaller businesses and local shopping centres are up against it.

Local small businesses as well as trading with us the consumers, also trade with each other - so the community gets twice the benefit. Money spent by and in local businesses spends on average three times longer in the local economy than that spent with chain stores which is instantly lost to the local economy which in times of recession our communities can ill afford.