<p>Questions Without Notice from Party Spokespeople</p>

1. 1. Questions to the Cabinet Secretary for Economy and Infrastructure – in the Senedd at 1:40 pm on 15 June 2016.

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Photo of Elin Jones Elin Jones Plaid Cymru 1:40, 15 June 2016

(Translated)

I now call on the party spokespeople to ask questions of the Cabinet Secretary, and first this week, the Plaid Cymru spokesperson, Adam Price.

Photo of Adam Price Adam Price Plaid Cymru

Diolch, Lywydd. Can I first of all formally congratulate the Cabinet Secretary on his appointment and wish him every success in what is a vitally important role?

Now, you can’t manage what you don’t measure, so the saying goes. When it became clear that Wales was not going to meet the target of closing the gap, relative to the UK, for gross value added, instead of changing the strategy, one of his predecessors as economy Minister decided instead to change the target.

Now, in the last term, the Government described gross disposable household income per head in its annual report as the best single measure of economic well-being. Given the fact that, in the latest figures, Welsh GDHI, relative to the UK, has fallen for the last two years for which figures are available—it’s now down to its lowest level since 2002—will the Cabinet Secretary accept that, according to what is his own Government’s yardstick of success, he’s failing the Welsh economy? What will he, as the new economy Secretary, decide to do—change the strategy or, once again, change the target?

Photo of Ken Skates Ken Skates Labour 1:41, 15 June 2016

Can I thank the Member for his question and congratulate him on his appointment as well? Indeed, can I congratulate the other two Members of Plaid Cymru who have been appointed to shadow me? Having three shadows makes me feel like a marked man, I must say.

With regard to the specific questions that the Member raises, we will be developing a new economic strategy and I would hope that you would be able to contribute to that, and we will be reviewing those targets. There are many important indicators of economic success, and, let’s face it, we now have record employment levels in Wales. We have unemployment falling faster here than across the rest of the UK. If you look at figures for tourism as well, you’ll see that we have record success as well as on imports, on exports and on inward investment—Wales is performing better today than it did at any other point during devolution.

Photo of Adam Price Adam Price Plaid Cymru 1:42, 15 June 2016

I’m amazed to see the Cabinet Secretary refer to exports as a symbol of Welsh success. Over the last two years, Welsh exports have dropped by over £2.6 billion. That’s a drop of 20 per cent in total. Let’s put that in a little bit of context, shall we? That’s the same reduction in exports, proportionally, as the UK experienced in the economic crisis between 2008 and 2009. It’s the equivalent of our current surplus in trade with the EU. Now, I agree with him that Brexit would indeed be a catastrophe for Welsh exports, but what about the catastrophe that has happened under this Government’s own watch? Will he establish an urgent inquiry into the causes of the Welsh export collapse and will he also look, Llywydd, at the leakages to the Welsh economy as a result of imports? Can the Secretary confirm that German and Spanish specialist steel is being used in the eastern distributor road project, funded by his department—a road only yards away from this building, ironically on which a Welsh steelworks is actually located? If his answer is that these specialist products cannot be currently produced by Welsh companies, does that not demonstrate the need for a team of specialists, working with businesses in Wales, to identify opportunities in the procurement pipeline, like the team that we did have until his Government replaced them in January this year with a couple of part-time staff, a few seminars and a phone number.

Photo of Ken Skates Ken Skates Labour 1:44, 15 June 2016

Well, well, well, we shouldn’t be surprised that the Member wishes to talk down the Welsh economy, but the very fact of the matter is that when we ignore the selective figures that he chooses to adopt and when we look at what’s happened since 1999, which is a fair indicator to begin with, there has been an 89 per cent increase in Welsh exports, compared to an increase of just 69 per cent for the whole of the UK. You talk about Brexit, but what would leaving Great Britain do to the Welsh economy? What sort of damage would that inflict on this country, on millions of people who require the British economy for work and for prosperity?

Presiding Officer, the facts speak for themselves: Welsh exports in the first quarter of 2016 were higher in value than in the previous quarter, up 2.9 per cent compared to a fall of 2.7 per cent in the UK. That is a key statistic that the Member chooses to ignore. In addition, what we know from the eastern bay link road is that, whilst there are pieces of scaffolding that have been sourced from Germany, which will be temporary, 89 per cent of the steel for reinforcing bars, which will remain in situ, are from Wales. That is something that we should be proud of; that is something that we should promote. I’m doing it. I wish the Member would too.

Photo of Adam Price Adam Price Plaid Cymru 1:45, 15 June 2016

Well, I think the question on most of our minds is: what would changing the Welsh Government do for the Welsh economy? They can hardly do any worse than the current administration. [Interruption.] Look, in the interests—[Interruption.]

Photo of Elin Jones Elin Jones Plaid Cymru

Allow the Member to be heard and to come quickly to his question. Diolch, Adam.

Photo of Adam Price Adam Price Plaid Cymru

In the interests of being charitable, I think it would be wrong to expect the new Cabinet Secretary to have all the answers at his first outing at ministerial questions. Indeed, that’s true of most Governments. That’s why most Governments in the world have an executive agency to help them deliver their economic strategy. Now, I realise it would be difficult for this Government to bring back the Welsh Development Agency, as that would be an admission that they’d made a mistake, which is something they patently are unwilling to do. But can the Cabinet Secretary confirm that the Government, following an earlier feasibility study, has now commissioned a detailed business plan for a national innovation body for Wales—another Plaid Cymru policy being delivered by a Labour Government? Can he also confirm that the scope of this study includes examining the case for widening the remit of this arm’s-length body to include a wider economic development role? Some of us might be tempted to call that a WDA for the twenty-first century.

Photo of Ken Skates Ken Skates Labour 1:46, 15 June 2016

Plaid Cymru wanting to go back to the 1980s to create the WDA and go back to quango heaven: no, we prefer accountability to sit with the Welsh Government. When it comes to exports, one other factor that’s worth bearing in mind is that we saw some categories soar in recent times—we saw machinery specialised for particular industries exports up 30 per cent, we saw road vehicles up 21 per cent, we saw increases in exports to Qatar, up 46 per cent. It’s why the—[Interruption.] They may understand it. It’s why people—[Interruption.] Let’s hope they understand this: commodity prices have fallen. Petroleum products’ value also has caused not just exports in the UK, but exports elsewhere, to fall in value. That is a fact of the matter. That is a reality around the globe. Setting up another quango will not solve the problem of commodity prices or petroleum prices.

Photo of Elin Jones Elin Jones Plaid Cymru 1:47, 15 June 2016

(Translated)

The Welsh Conservatives’ spokesperson, Russell George.

Photo of Russell George Russell George Conservative

Can I also congratulate the Cabinet Secretary on his appointment and say that I look forward to working with him constructively, where appropriate? Cabinet Secretary, the Welsh Government’s directory of Welsh motor sports companies states that Wales has a well-established automotive sector, generating a turnover of over £3 billion annually. Indeed, one of the success stories of the tourism industry has been our support for the forest-stage rallying in Wales, worth approximately £15 million a year to the Welsh economy. Motor sports, of course, are therefore of vital economic importance, and I wonder if you could outline what the Welsh Government is doing to promote and safeguard the motor sports industry in Wales.

Photo of Ken Skates Ken Skates Labour 1:48, 15 June 2016

Can I thank the Member for his question, and also congratulate him on his appointment? I look forward to working with him in the years to come to ensure that we have a stronger, more secure economy in Wales. The automotive sector is a crucially important sector across Wales. In particular, for tourism, it contributes enormously to the success of our major events portfolio, which, in turn, attracts 800,000 people to Wales each year and generates something in the region of £125 million in terms of economic impact.

Photo of Russell George Russell George Conservative 1:49, 15 June 2016

Well, thank you, Cabinet Secretary, for your response and I’m pleased to hear that you are aware of that information as well. The long-term future of the forest-stage rallying in Wales is under some serious threat as a consequence of Natural Resources Wales’s proposal to almost double the charges to the industry for the use of and maintenance of roads. Now, it appears that, in England and Scotland, agreement has already been made, with a modest increase in charges of just 0.7 per cent. Now, would you agree with me that there are, of course, wider economic benefits to motor sports events, and that the future of the industry in Wales should not be put in jeopardy? I wonder whether you would agree to—along with the Cabinet Secretary for the environment—intervene personally in negotiations on the contract between NRW and the Motor Sports Association, which, of course, would allow the industry to continue to flourish in Wales, rather than cease?

Photo of Ken Skates Ken Skates Labour 1:50, 15 June 2016

I’d like to thank the Member for his supplementary question and say that this is part of a negotiation that’s taking place—in terms of the commercial negotiations taking place—in such a way that I can’t comment on the details. However, I have now met with my colleague, Lesley Griffiths, to discuss this, and, as a consequence of that, I’m pleased to say that Natural Resources Wales and the Motor Sports Association are continuing to negotiate charges to enable rallying to continue on Welsh forestry estates, and I’m confident now, as a result of the discussions that we’ve had, that a mutually acceptable compromise can be reached. There’s no doubt that rallying in the Welsh forests is iconic, and Wales Rally GB in particular is part of our international profile. We want it to succeed and to continue.

Photo of Russell George Russell George Conservative

Can I thank the Cabinet Secretary? I think that’s an encouraging response, so perhaps it would be timely if we could have a statement over the coming weeks, as negotiations come to a conclusion in a positive way as the Cabinet Secretary suggests and, perhaps at some point, he’d be willing to visit one of the stages in mid Wales with me as well—perhaps we could have a race with each other; I don’t know.

Staying on the theme of tourism, Cabinet Secretary, I understand that the Brecon Beacons National Park Authority has recently reviewed the options for how services are delivered at the national park’s visitor centre. Now, among the changes, it’s recommended the closure of the information and retail element of the centre, which replaces it with an unstaffed information point. I’d ask you, Minister, to make representations to the national park authority to urgently reconsider this decision, as I certainly believe this would have an adverse effect on tourism, not only in the area, but in the wider mid Wales economy.

Photo of Ken Skates Ken Skates Labour 1:51, 15 June 2016

Yes, I’ll commit to doing that. Actually, the national park authority is on my steering committee for the Year of Adventure, so I’ll be able to raise it with people in person as well, and I would also commit to providing a statement on Wales Rally GB and the future of the automotive sport in Wales.

Photo of Elin Jones Elin Jones Plaid Cymru 1:52, 15 June 2016

(Translated)

UKIP spokesperson, Neil Hamilton.

Photo of Mr Neil Hamilton Mr Neil Hamilton UKIP

Thank you, Presiding Officer. I’ve already had the opportunity to congratulate the Cabinet Secretary on his appointment, but you can’t have too much of a good thing, so I’ll congratulate him again today and express the hope that, under his guidance, the Welsh economy will really get its skates on—boom, boom. [Laughter.] According to the opinion polls, it looks very much as though Britain is going to vote to leave the EU next week, and I wonder, therefore, if the Cabinet Secretary has given any thought to how he will spend the Brexit dividend that will come to Wales in that event. Because, just taking the one measure alone of Britain’s net contribution to the EU—that’s the money we give to Brussels to be spent elsewhere in the EU of £10 billion a year on a per capita basis calculation—that’s about £500 million a year that will come to Wales and the Welsh Government to be spent. It would be interesting to know if he’s got any ideas as to how we can spend even a part of that money.

Photo of Ken Skates Ken Skates Labour 1:53, 15 June 2016

Can I thank the Member for his kind comments about my appointment and wish him well in his role, as well, in the Assembly? There can be no guarantee that that money would come to Wales. I rather fear that it will be squirrelled away to places like Wiltshire rather than come here to Wales. I think it’d probably end up in the Cotswolds rather than Cymru. There is no guarantee that Wales would benefit from EU money that is repatriated back to the UK. Do we really want to jeopardise, right now, next week, the progress that we’ve made on steel, what is an incredibly sensitive position? We would throw that crisis even deeper into the unknown were we to vote to leave the EU. We would throw 18,000 jobs, certainly at risk, if we were to vote to leave the EU. We would put at risk 52,000 apprenticeships that people are going to be seeking to fill in the next five years if we voted to leave the EU. We would also put at risk ReAct, which has provided opportunities. It’s provided hope for 19,000 people who have faced redundancy. That’s why Europe exists: to provide hope for people who need it. Do we really want to vote out of Europe and compromise that sort of opportunity for millions of people in Britain?

Photo of Mr Neil Hamilton Mr Neil Hamilton UKIP 1:54, 15 June 2016

Well, I think it’ll come as a surprise to the people of Greece, Spain, Italy, Portugal and France that Europe represents hope, and I certainly take issue with the Cabinet Secretary on his rosy-tinted view. Of course, there can be no guarantees about the future; there’s no guarantee that any of us will be alive this time next week. But, nevertheless, it’s reasonable to assume that Wales will get a pretty high proportion of what it is due on a per capita basis if we leave the EU, and if we add in the £5 billion on top of the £10 billion that’s spent elsewhere in the EU—that the EU spends in Britain for their priorities, not our priorities—this offers the Welsh Government a massive opportunity to spend on things that matter to the people of Wales, rather than to the bureaucrats of Brussels.

Photo of Ken Skates Ken Skates Labour 1:55, 15 June 2016

The Member claims that Europe has not offered hope—what Europe has offered is the longest period of sustained peace in the history of the continent. It has offered hope and it has delivered peace and prosperity right across the continent. Voting out of Europe next week would certainly cause compromise for the steel industry in Wales and the UK. The Member may not wish to believe me, but he should believe Tata themselves when they say, and I quote directly:

‘The EU is by far our largest export market, with over a third of our UK steel heading there, and that’s not including the steel that goes via our customers, so access to that market is fundamental to our business’.

If the UK were to exit the EU and we set rules ourselves, it is likely we would still need to adhere to EU rules to enter that market. The difference: we would no longer have a say in how they are set up or applied. The EU is a source of cash for the UK business sector, funds for environmental improvements, infrastructure development and research and development. Would the Member today wish to tell steelworkers he would wish to compromise their jobs and their future to vote out of Europe next week?

Photo of Mr Neil Hamilton Mr Neil Hamilton UKIP 1:56, 15 June 2016

Well, leaving the EU would, of course, not compromise steel jobs at all. We would have the freedom to do what the United States has done and slap a 522 per cent duty on cold-rolled steel as opposed to the 24 per cent duty that the EU has proposed. But I wonder can the Cabinet Secretary explain to me why the EU would want to put up any trade barriers against the UK when the figures announced only a couple of days ago show that we had in the first quarter of this year alone a deficit of £24 billion in our trade in goods. They have much more to lose than we have from a trade war.

Photo of Ken Skates Ken Skates Labour

Let’s reflect on where we are right now. There is without a doubt, in my view, a new momentum in the Welsh economy. Tourism figures I’ve already mentioned—they’re up, employment is up, FDI up, exports up, business start-ups up, airport passenger numbers up. Apprenticeship completion rates—they’ve risen, too. The only thing that we could guarantee if we left Europe next week is that all of these stats would go down. I would urge the people of Wales and the people of Britain to vote to remain.