Questions now from party spokespeople. The UKIP spokesperson, David Rowlands.

Diolch, Llywydd. I make no apologies for the fact that I have raised the theme of my question a number of times before in this Chamber, because I believe it is fundamentally important if we are to expand the economy of Wales. We have heard recently the criticism of the levels of grants, as opposed to loans, that the Government has advanced to companies since 2010, together with the allegations that it gave loans to companies that subsequently failed. We in UKIP acknowledge that the Welsh Government is in the high-risk sector when making decisions with regard to advancing these moneys, whether in the form of grants or loans, in that it is a given fact that it aims to fill gaps where high-street banks have declined to be involved. Can the Cabinet Secretary confirm that, despite some unavoidable setbacks, the Welsh Government will continue to invest heavily in the business sector? And I promise not to mention the circuit of Wales here.

Can I thank the Member for his question and say, yes, we will go on investing in business in Wales—businesses that provide work opportunities for tens and hundreds of thousands of people in our communities. Our support since 2011 has provided work for 185,000 people. In the last Assembly period, it was 150,000 jobs that we created and supported through helping businesses to grow and expand. And the Member raises the important point about business failure. Well, I think I’ve already stated in this Chamber before, but I’m happy to write to Members again with the data, that the proportion of companies that failed was lower amongst those that we’d supported than in the entire economy. I think that demonstrates that whilst, yes, there were losses and there were failures, by and large, our support has acted as an enabler for growth in the economy. And it’s as a consequence of this that we can now with some confidence say that we have a sustained low unemployment rate that goes way beneath what we experienced in the 1990s and the early 2000s, and that’s as a consequence of pursuing every possibility to grow the economy and create jobs.

I thank the Cabinet Secretary for that assurance. Can I now ask how the Cabinet Secretary intends to make sure that funding for start-ups, particularly in the innovative sector, is readily accessible, especially once the Wales development bank begins to operate?

Well, the Member pictures there the important role that the development bank of Wales will have in almost doubling the amount of finance that’s available to small and medium-sized enterprises. I’m pleased that, this week, I received the location strategy for the bank to operate right across Wales, giving easy access to all SMEs. And I also believe that the role of the innovation programme, Be the Spark, will be critically important in driving innovation-led entrepreneurialism throughout the economy, bringing together different stakeholders so that we can all work together in creating a strong tech-based and innovation-driven economy that’s based on strong foundations.

Well, again, I thank the Cabinet Secretary for his assurances, but one of my constituents who is seeking funding for a very innovative product with huge commercial potential was recently told by a Business Wales representative that the product was insufficiently developed for funds to be made available. This hardly seems to be in accord with the Government’s affirmed policy to be involved in the innovative sector. Could the Cabinet Secretary give us some idea as to what the Welsh Government means by ‘innovative’, given that, if it is innovative, it may well not be fully developed?

I think it’s important that plans are at the point of being able to be realised, and I’d certainly welcome further detail about the particular example that the Member raises. There are support forms from Business Wales and also innovation vouchers that could be applicable to the particular case that the Member raises, but if he writes to me, I’m sure I can give it further consideration. Generally, through our support for business and entrepreneurship, through Business Wales and through initiatives such as Be the Spark, we now have more active businesses in Wales than ever before. That’s surely good for the economy, but we also need to have a dynamic economy where we have a constant dynamic that delivers new enterprises as exiting enterprises die.

Llefarydd Plaid Cymru, Adam Price.

Diolch, Llywydd. Unlike David Rowlands, I cannot promise not to mention the Circuit of Wales. On Friday, in a written statement to this Assembly in relation to the publication of the due diligence conducted on that project, Cabinet Secretary, you said that,

In relation to the fit and proper person test report, we have been unable to publish either in full or in summary because Michael Carrick has not yet consented to its release’.

Could you tell us when a copy of this report, either in full or in summary, was first sent to the Heads of the Valleys Development Company and its principals with a request for their consent to its publication?

Yes, I’d like to respond comprehensively with the time frame for all Members today. Michael Carrick was provided with a redacted copy of the Grant Thornton corporate intelligence report, which is the fit-and-proper-person test, in May of this year. He then wrote to the Welsh Government on 30 May, setting out his observation that the report contained areas of concern for him and his colleagues. On 1 September this year, Michael Carrick, as chief executive officer of Heads of the Valleys Development Company, again wrote to Welsh Government stating that, and I quote, as regards the corporate intelligence report—which is the fit-and-proper-person test—which focused on individuals, they would emphasise that this not be released.

Now, I made it clear in my statement last week in relation to the fit-and-proper-person test report, we have been unable to publish either in full or in summary because Michael Carrick has not yet consented to its release. Following publication of the due diligence documents last Friday, Welsh Government wrote again to Michael Carrick on 6 October with a further copy of the redacted report, and asked again if he would consider the matter and advise whether he was content for the Welsh Government to make this material publicly available. I can share with the Member and, indeed, all Members in this Chamber the following information: Martin Whitaker, the chief executive of Circuit of Wales, responded and made it clear on Monday 9 October that, ‘Our position remains unchanged in that we decline any consent for the release of the report.’ He also said, ‘We refers to the Head of the Valleys Development Company, Aventa and all of the individuals mentioned and referred to in the report.’

Thank you, Cabinet Secretary, for that report. The company in the letter that he referred to contests what he has just said, and I’m sure they will respond in due course. They maintain that a redacted copy of the report was only made available to them at 5.16 p.m. on Friday evening after the statement was made to the Assembly.

While we’re on the subject of the publication of information in relation to the Circuit of Wales, can I ask the Cabinet Secretary about the leaking of confidential information held by your department to the ‘Western Mail’? Is he able now to update the Assembly on the leak inquiry that has been conducted?

This is not a matter that I am leading on; this is a matter for the Permanent Secretary, and I’m sure that she’ll be making all of her observations known in due course.

On 7 July, Cabinet Secretary, you told me in a written reply that you did not expect that civil servants were involved in the leaking of this information, and I believe that has now been confirmed by the Permanent Secretary. On 14 August, you told me that you were satisfied that special advisers were not responsible for the leaking of this information. That doesn’t leave many people left in the frame, Cabinet Secretary, so can I ask you simply this: do you know who leaked the information?

No, and what about the company itself? I would say to the Member that I recognise, given his unusual pursuit of this matter over a length of time, that he feels personally hurt by the outcome, because he’s staked all of his credibility on this particular project. And after performing the biggest u-turn since the dawn of devolution last week, you’ve shot to pieces your credibility on the economy. Two weeks ago, you were writing to all local authority leaders urging them to back this particular plan—

Answer the question that I asked you.

[Continues.]—to back this plan. And then within a week you’d gone on to say, ‘No, the management needs to change, the plan needs to change, the funding system needs to change.’ After spinning like a whirlpool one week, you then went and jack-knifed like a juggernaut the next. I mean this when I say it: you’ve got a lot to offer this Assembly and it’s no good shooting your own credibility down in the way that you just have done. [Interruption.]

Welsh Conservative spokesperson, Russell George. [Interruption.]

Thank you, Presiding Officer. Cabinet Secretary, if a family of four from the north-west of England were thinking of going on holiday to either Colwyn Bay or Morecambe Bay, perhaps hotels and facilities very similar, and one of those was charging a tourism tax, which one do you think that that family would choose?

They’d choose the best location, in my view, and that best location is Wales.

Well, what I’d say, Cabinet Secretary, is that yesterday we heard the First Minister offering his avid support for a tourism tax here in Wales. The introduction of a tourism tax may well have the desired effect in countries that have low sales taxes, but in Wales where the full rate of value added tax is charged on accommodation, on meals and attractions, an additional tourism tax will in effect mean that the visitor pays twice. Slovakia is the only other country in Europe that charges a tourism tax while not having a reduced rate of VAT for accommodation businesses. So, is it your wish, Cabinet Secretary, that we should follow Slovakia’s lead? And also, your colleague Mark Drakeford has said that he wants to encourage behavioural change through the tax system. How do you think a tourism tax would change behaviour?

Well, first of all, if we look at the rate of VAT at the moment here in Wales, it’s charged at 20 per cent. In Paris, VAT is charged at 10 per cent. In Berlin, it’s charged at 7 per cent. In Barcelona, it’s charged at 10 per cent. I would urge the Welsh Conservatives to support this Government’s campaign, which has run for some time, I acknowledge, but which has fallen on deaf ears at UK Treasury, to reduce the level of VAT. The big difference between a local levy and VAT is that a local levy could be retained within that area to enhance the place that people wish to visit. It’s a local levy designed to improve the tourism offer. VAT goes to central finance in London and does not always find its way into those areas of Wales and Britain that need to be enhanced for the visitor economy.

Well, I wonder what the tourism industry would make of your answer. What I would ask is: what consultation have you done and conducted with the tourism industry or, indeed, were you actually consulted on this by your Cabinet colleagues at all as well? I have to say, the British Hospitality Association has said that a tourism tax will, and I quote, undermine business sustainability, investment and…our employment plans’, as well as be handing an unfair advantage to our competitors in England.’

The BHA, the Wales Tourism Alliance and MWT Cymru, and many other experts across the industry, have said that the prospect of introducing a tourism tax will harm Wales’s competitiveness and heap additional pressure on an industry that already pays tourism VAT and has seen increases in business rates. A day visitor to Wales already spends £17 per head less than in Scotland, £5 less per head than visitors to England. A tourism tax will deter them from visiting and spending here even further. In 2004, an inquiry was undertaken by Sir Michael Lyons that concluded that there was not a strong evidence base to support the introduction of a tourism tax. The Labour UK Government agreed. So, will you now take the opportunity to follow the advice from the industry and rule out the introduction of a tourism tax to provide the industry with the certainty that it needs?

I’d like to thank the Member for his question. He’s offered comprehensive analysis of the potential impact of the tourism levy. He’s not yet provided though a comprehensive analysis of the benefits. As part of the consultation and consideration of this particular proposal, we will now undertake a consultation exercise that will encompass all elements of an evidence-gathering exercise. We need to establish the potential benefits and, of course, the potential consequences of a tourism levy, and I commit to engaging fully with the sector in analysing the potential benefits and the potential costs of that particular initiative. This is one of four that are being considered. Each and every one of those proposals will take time to assess, but I do commit to working with the sector.