Force Majeure

1. Questions to the Cabinet Secretary for Economy and Transport – in the Senedd on 10 January 2018.

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Photo of Angela Burns Angela Burns Conservative

(Translated)

5. What assessment has the Welsh Government made of the number of businesses adversely affected by force majeure? OAQ51502

Photo of Ken Skates Ken Skates Labour 2:11, 10 January 2018

Through Business Wales's Construction Futures Wales and procurement support we remain committed to supporting business resilience. Diagnostic checks and support ensure that businesses are fit and as best-placed as possible to withstand the impact of general or force majeure issues impacting their financial standing.

Photo of Angela Burns Angela Burns Conservative 2:12, 10 January 2018

Thank you. It's a difficult question, and I use the term 'force majeure' very deliberately, because of course you'll know that that affects the levels of compensation, and it is also a reason why organisations can withdraw services. I've had a number of concerns raised with me by both small businesses and the general public where they feel they've been on the rough end of a deal where they've not been able to either complete something or have not had a recompense, and the businesses have used the excuse of force majeure. This is mainly all to do with the various storms that have swept us over the last three or four months. I just wondered if there's anything the Welsh Government can do to assess or analyse whether or not this clause is being appropriately used and to remind small businesses that they have that liability if they themselves stop performing a service, and it is something where they are not covered, and they must have that business resilience in place.

Photo of Ken Skates Ken Skates Labour 2:13, 10 January 2018

I'd like to thank the Member for this question. When I saw it submitted I was at first perplexed and then realised, actually, this is a piece of work that needs to be considered more deeply. I took a look at the clause and, in particular, condition 39.2, or part of 39.2, which states:

'However, if any such event prevents either Party from performing all of its obligations under the Contract for a period in excess of 6 months, either Party may terminate the Contract by notice in writing with immediate effect.'

My concern is—[Interruption.] Exactly, yes. I'd happily take up this issue. If the Member has any information that would enable my officials to consider instances of force majeure that are leading to unjust withdrawal of support under a contract, then please do share it with me.