1. Will the First Minister make a statement on the future of Welsh supply chains? OAQ(5)0661(FM)

As a Government, we are committed to nurturing supply chains across Wales. The future for Welsh supply chain companies is bright, and supporting Welsh businesses of all sizes to access major investment opportunities now and in the future is a key priority.

The Chartered Institute of Procurement and Supply has recently concluded an extensive survey of businesses in the UK and on the continent in light of the EU referendum last year, and it found that nearly half of continental businesses expect to reduce their use of UK suppliers. The survey also found that 65 per cent of UK businesses have seen their supply chains become more expensive as a result of the weaker pound, and nearly a third are renegotiating some contracts. The Irish Government, although, of course, Ireland’s staying within the European Union, has pre-empted the potential risk to supply chains as a result of Brexit. I wonder if the First Minister would agree to convene a summit of Welsh supply businesses, and consider and explore the possibility of establishing a business loan scheme to support Welsh supply chains through the coming two years of great uncertainty to them?

Well, I think the first thing that we have to be clear about is what the nature of Brexit might look like. We’re still no clearer as to what that might mean. His party and, indeed, ourselves as a Government, have been very clear that it means full and unfettered access to the single market. Until we have an idea of what the future holds for Welsh businesses, then it will be difficult to give them the certainty that they require. That said, it is hugely important that we work with our businesses in order to make sure that they’re able to procure as many Welsh contracts, certainly, as possible, and to press on the UK Government that they should not reduce the ability of Welsh businesses to do business in Europe in the future.

On 8 April, I and my colleagues, Dawn Bowden and Rhianon Passmore, held a local summit of our own to discuss the Cardiff capital region deal, at which Alun Davies spoke very well. [Interruption.] The event was attended by representatives of the local authority, local employers—he was heckling me there, reminding me to mention it—further and higher education and transport providers. One of the key themes to come out of the event was the importance of sharing social capital across local supply chains in the northern Valleys, where collaboration between local firms is as important, if not more important than competition between them. Would the First Minister, therefore, recognise that regional growth deals need to accept the importance of social capital, strong local procurement and the views of indigenous businesses if the capital deals are to be successful?

We remain committed to delivering successful deals for all regions of Wales and to be a full partner in their development and delivery, because, as the Member has said, deals offer Wales, and particularly the regions of Wales, an opportunity to unlock additional Treasury funding to support interventions that can deliver sustainable economic growth. A lot of work needs to be done, of course, in order to get not just businesses, but businesses and local authorities to work together, but we know that that is a path that offers the best outcome for all the communities of Wales.

First Minister, the Welsh Government’s record to date in working to ensure that Welsh firms benefit as much as possible from public procurement issued in Wales is a poor one, I think. As of early 2016, of the 130 Welsh Government corporate procurement contracts awarded since 2011 and worth more than £500,000, just 53 per cent were awarded to Welsh businesses. And nothing highlights this more than the Heads of the Valleys road project, which, despite being a capital project based in the heart of Wales, was awarded to an English-based contractor. So, going forward, what can you do to ensure that Welsh companies benefit far more from public contracts offered in Wales in order to help build the supply chain here in Wales?

We’ve seen a significant increase in the number of Welsh businesses who are accessing Welsh public sector contracts. The figure has gone from around about the 37 per cent mark, if I remember, to over a half now, which is a great improvement. Through initiatives such as the supplier qualification information database, for example, and the procurement initiative, we have ensured that Welsh businesses are better able to compete for contracts, and in particular are able to work together with other firms in order to be successful in getting those contracts in the first place. Clearly, there will be particular contracts that can be only be delivered by companies with particular specialist skills, but, nevertheless, we have seen a significant growth in the number of Welsh businesses that are successful in bidding for public sector contracts.