Questions now from the party spokespeople. The Conservative spokesperson, Russell George.

Diolch, Llywydd. Minister, can you outline what plans are in place for the implementation of your economic action plan this year?

Yes, and I thank the Member for his question, and wish him and all other Members a very happy new year.

Of course, the economic action plan now has with it regional teams established and chief regional officers. We've got a cross-Government delivery board, regional plans are being put together at the moment, and the OECD has been invited to scrutinise and assess the success of the EAP. We've implemented the economic contract and also the economy futures fund, and, with the economy futures fund, of course, the calls to action—the lens through which we are now investing in businesses.

Can I thank the Minister for his answer and welcome him back to the post in the new Government?

Of course, you talked there about the implementation of the plan, but what I want to understand is the detail of that. Certainly, at the meeting of the Economy, Infrastructure and Skills Committee in January, Members asked you about the delivery of the new economic action plan, and at that meeting, when asked by committee members about the detail of delivering the action plan, you said that discussions were under way between the Welsh Government and relevant stakeholders and that more details would follow in the spring. So, I submitted a written question in the spring and asked for progress on the economic contract and the calls for action—of course, two key components of the plan—and in your answer, you said that,

'We have been discussing our approach with businesses and other organisations across Wales'.

So, again, I asked you in a written question just before Christmas—just last month—and in your answer then you said that your planned measures included refining your approach in 2019 and taking forward work to develop challenge proposals with groups of businesses. So, my concern here, Minister, is that there is talk about plans but nothing that we can tangibly see. All I hear about is plans: plans to deliver a plan and then to deliver the next plan. So, I will ask, Minister: has the delivery of the action plan stalled, and, again, when will we and businesses see progress tangibly on the ground?

The Member is absolutely right that it's all about implementing the plan. It's not just about designing a plan and publishing a plan, as the UK Government has found in its inability to implement a Brexit plan or indeed even get agreement for it. I am able to confirm to the Member that the economic contract is now in place and more than 100 businesses seeking financial support from the Welsh Government have signed the economic contract. In terms of refining the economic action plan, we're looking at how we can firstly extend the principles of the economic contract right across Government, including through procurement, but we're also looking at, as I think I've already made clear in previous committee appearances, how we can consolidate further funds into the economy futures fund. Dozens of awards have been made already through the economy futures fund. I think perhaps one of the highlights of the period between launch of the EAP and implementation has come just this week, when we were able to announce support for Thales to take forward the National Digital Exploitation Centre, which is of course an initiative that meets more than one of the calls to action. It focuses largely on the development of skills. It focuses on research and development, and it also focuses on innovation, demonstrating how the economic action plan is already making a big difference as we strive to increase the availability of high-skilled, well-paid work and as we drive forward the inclusive growth agenda.

It's perhaps worth my saying as well that, in terms of the challenge opportunities that we're looking at considering soon, just before Christmas I shared a platform with the Secretary of State for Business, Energy and Industrial Strategy, Greg Clark, in London at the Royal Society, where we both talked about the importance of place-based economic development and how the economic action plan can dovetail with the UK industrial strategy in a number of ways. One of the ways in which we discussed further collaboration or one of the avenues that we discussed in terms of further collaboration concerned the UK Government's grand challenges and the Welsh Government's challenge proposals from business.

So, I think that a huge amount of work has already taken place in terms of implementing the economic action plan, through those dozens of awards, through the economy futures fund, and many jobs have been created. But, most importantly of all, we are now driving a very, very clear inclusive growth agenda through the implementation of the economic contract and through businesses so warmly welcoming it and signing up to that contract.

[Inaudible.] delivery, of course—that is important, rather than just a plan. What businesses need, I'm sure you will agree, is clarity to operate effectively, and they're looking to the Welsh Government to provide this. So, Minister, I want to see something specific and something practical happening on the ground, and what is going to be delivered over this next 12 months? Businesses want to know that and I think we, as Members, want to know that in order that we can hold you to account and scrutinise you in that regard. But can I ask you to consider setting out a timetable—a month-by-month timetable—over this next year so that we can measure the delivery against your economic plan?

Can I point to a number of areas that I think Members should take an interest in this year, particularly after we exit the EU, and they concern the awards that we make through the economy futures fund: how many awards are we making to businesses that are seeking to drive inclusive growth and to futureproof themselves and the Welsh economy?

The second concerns the economic contract: how many businesses are signing up to the economic contract? And then, thirdly, the creation of the regional units: how many members of the civil service are allocated to the contract research organisations? At present, CRO teams are very small. It's my intention, as we drive regional economic growth—that place-based agenda—to increase those teams as rapidly as possible so that the change on the ground is very apparent to businesses.

What businesses tell me, day-in, day-out, is that there is a large number of advisory services and there's a large number of support services available, but the problem, perhaps, is that there isn't simplicity and transparency. And within the ethos of the Be The Spark initiative, we need to ensure that there is greater simplicity, collaboration and consolidation wherever and whenever possible, and, for that reason, we're setting up the regional units, bringing together Welsh Government activities and local government activities on a regional basis and aligning them with the services offered by Business Wales and the Development Bank of Wales. So, no matter where you are in Wales, you are only one  point of contact away from financial support, an advisory service and the sort of support that's required in order to futureproof your business in the fourth industrial revolution.

The Plaid Cymru spokesperson, Rhun ap Iorwerth.

Diolch yn fawr iawn. Minister, could you remind us how you define what an anchor company is and how important you think their well-being and long-term sustainability is to the Welsh economy?

The Member will be interested to know that I'm carrying out a review of the definition of anchor company status and regionally important companies. There is no doubt that large companies make a huge contribution to the Welsh economy. In 2018, Presiding Officer, there were 1,675 large enterprises active in Wales, and that represented 0.6 per cent of all active enterprises in Wales, which is well above the equivalent UK figure of 0.1 per cent. As we've seen with the likes of Aston Martin and Airbus, those companies that are currently considered anchor companies are hugely important in driving growth within their respective supply chains. 

I'm very interested to note the review that will be taking place and I look forward to hearing the results of that review. Ford, of course, is one anchor company. A thousand jobs are at risk there, we now understand. Airbus is another. Goodness knows what threats there will be to future investment there in light of Brexit. Wylfa Newydd, surely, would be an anchor in years to come. I'll have a chance to return to that issue with a topical question later on. But how do you reflect on the potential impact of the fact that across Wales anchors seem to be slipping, and is that a driver behind the review that you've called? 

Anchors aren't slipping, necessarily. Let's take Airbus as a perfect example. They are becoming far more efficient, and Airbus has approximately 6,000 employees in Broughton. It's about the same that it had six years ago, but what's changed between 2013 and 2019 is that the site has become about 40 per cent more efficient, and that has to take place—that sort of efficient drive has to take place right across all businesses if they're to succeed and strive in the fourth industrial revolution, the age of digitalisation, digitisation, artificial intelligence and automation.

Ford is a major concern, and just as I'll be at Airbus tomorrow talking about the consequences and the implications of what's happening at Westminster with business leaders in north Wales, and primarily with Airbus, today the First Minister was at Ford discussing the future of the plant. What is very apparent is that the change in the automotive sector is presenting huge challenges for the global automotive industry, and Ford itself is looking at plant closures, line removal at sites in France, potentially Russia and in Germany. Here in Wales, at Ford in Bridgend—as I said yesterday we have a highly trusted workforce, a very efficient work programme, and a product, the Dragon engine, which is seen as being at the cutting edge of the internal combustion engine production suite. Now, what's important for the Dragon engine is that it's considered for hybridisation at the Bridgend plant, and we'll be doing all that we can to ensure that that takes place. 

But it's also important for Ford in Bridgend to capture any increase in demand for the Dragon engine as it is today, because I believe there are only six facilities that are able to build that particular engine, and Bridgend is, if not the most efficient, certainly one of the most efficient, with an incredibly skilled and loyal workforce. Alongside that, there has been much speculation about the potential of the Ineos investment, and, again, the Welsh Government is doing all that it can in order to secure that investment. 

I hope, between the work that I've been able to demonstrate we're doing with Ford, with Airbus, the interventionist approach that we are taking whenever and wherever possible, which last week led to the creation of hundreds of jobs at a new challenger bank, and this week has led to the creation of the national digital exploitation centre—the Welsh Government is certainly not standing still as the world spins. It seems out of control because of the Brexit dilemma. 

What we are seeing, though, through much of what you discussed there is the vulnerability of even those anchor sectors that we consider to be so important. Now, you'll know I'm not an 'eggs all in one basket, let's depend on a foreign direct investment bank and only on large companies' kind of guy, and you'll know that we in Plaid Cymru are clear on the need, for example, to refocus on growing our small and medium-sized indigenous enterprises. But there is no escaping the importance of those big players, and this is clearly, as you agree through your answers, a very risky time for them. So, will you agree to convene a major economic summit now to show that Wales is serious about overcoming current challenges, to show that Welsh Government is serious about overcoming challenges, and to discuss the nature of those challenges plus our needs in terms of infrastructure investment, and the needs of our small and medium-sized enterprises? Because we cannot afford to face those challenges without showing our mettle as a nation, and showing that we are serious about overcoming them.  

I would not disagree with the Member on those points, and I'm pleased to say that over the past 12 or so months I've been engaging with businesses by their respective sectors and on a regional basis—smaller scale summits, if you like, to discuss the impact that Brexit is having, and also the longer term challenges and opportunities that many sectors, in particular financial and professional services, advanced manufacturing and life sciences face. And the next summit, actually, will take place later this month. It will concern mariner energy and it will take place in Swansea. So, we are keenly pursuing every opportunity to engage with business to identify the threats, challenges and opportunities of the future, in the context, of course, of the situation that we face with Britain leaving the European Union.

I think what's really important now, though, is that, for all of the work that Welsh Government is doing and can do, the UK Government offers a calm, collected position that a proper Government with proper leadership can offer at Westminster, and, above all, the uncertainty over Brexit must come to an end.

UKIP spokesperson, David Rowlands.

Diolch, Llywydd. And can I also congratulate the Minister on being retained in his Cabinet position?

The First Minister stood in this Chamber—sorry. The previous First Minister stood in this Chamber and proclaimed that unemployment in Wales was below the UK average at 3.8 per cent. However, the latest figure is now running at 4.2 per cent, which is above the UK average. Does the Minister believe that the First Minister was a little premature in his positive assessment of this aspect of the Welsh economy?

No. In all fairness to the former First Minister, he was quoting factually the unemployment statistic at the time, and what is absolutely clear is that Wales now has record low unemployment, record low economic inactivity rates, record high employment rates, and that we are also seeing—. It is often assumed that economic activity and employment are confined, mostly, to the more urbanised areas, but actually, if you look at rural areas—you'll find, across Wales, in rural communities, employment rates higher and unemployment rates lower than the Welsh average. In parts of Wales—if you take north Wales for example—you'll find that not only is the unemployment rate there below the Welsh average and at a historic low level—in fact, the lowest level since records began—the unemployment rate there is also below the UK average.

I think there's a huge success story that should be told about the ability of the Welsh Government to drive down unemployment, and all of the facts, all of the evidence bears that statement out. Since devolution, Wales has had the fourth highest increase in gross value added, unemployment has fallen dramatically, inactivity rates have fallen dramatically. But what concerns me today, right now, is that set against a backdrop of record high employment and record low unemployment, we still need to ensure that jobs are more secure, we still need to ensure that jobs are better paid, and we still need to ensure that people have higher levels of skills in order to get better quality jobs.

I thank the Minister for that answer. Of course, as with all statistics, the devil is in the detail. For instance, we find that this unemployment statistic includes as employed those on the iniquitous zero-hours contracts. And another factor not addressed is the increase in the number of people in our border areas, particularly in South Wales East and the east of north Wales who, although they live in Wales, are actually working in England, which is not necessarily reciprocated. This would appear again, would you not agree, to further exacerbate the inaccuracy of the stated unemployment figures and therefore, of course, the true state of the Welsh economy? 

Well, the figure in the Mersey Dee Alliance area, that functioning geographical area of north-east Wales and Chester and Cheshire West and the Wirral, shows that around about 25,000 people do as the Member says—travel from Wales to England each day to work—and the figure travelling from England to Wales each day is also around 25,000. So, actually, it balances out very well, and that's why we're keen to ensure that the Flintshire corridor project goes ahead to make Wales a more attractive place for investment, so that we can win more investment on this side of the border. It's also a huge contributing factor to the improved GVA figures that I've already quoted.

But the Member raises and incredibly important point about zero-hours contracts and the availability of fair work. Well, we wish Wales to become a fair work nation, and in March, the Fair Work Commission will report back with recommendations about how we will meet our vision. Their recommendations will be fully considered in the context of the economic contract contained within the economic action plan. And it's my intention to be able to adopt those recommendations and implement them in a revised economic contract as soon as possible.

I thank the Minister for that clarification. The latest projections for post-Brexit Britain tell us that the UK will leapfrog France and become the sixth biggest economy in the world and is likely to remain there for at least a decade. Can the Minister assure us that he and this Government will do all that they can to ensure that Wales will not miss out on this unique opportunity to exploit this anticipated expansion of the UK economy so that we in Wales will avoid the seriously high unemployment figures currently being experienced across most of Europe?

Well, in order to raise the wealth and also the well-being of the country, we need Wales and we need the UK to become more productive. We also need to be able to compete better on the international stage. My grave fear is that, if we crash out of the European Union with no deal, our economy will shrink by around 10 per cent, our competitiveness will be hammered, our productivity levels could crumble and crash, because it will simply not be as easy as it is now to be able to get skilled labour here at the drop of a hat or, indeed, to deploy people from—we talk about Airbus—Broughton to Toulouse at a moment's notice. We won't be able to transport goods freely and rapidly. And also this is set against the backdrop of industry 4.0, which, I do believe actually offers us an opportunity to leapfrog other nations. There are precious few opportunities that economies have to excel in a short, rapid period of time, but the fourth industrial revolution, if we capture all of the opportunities, if we embrace it, gives us an opportunity to leapfrog, not just some of the existing strong economies of the world but also those that are biting on our heels. We will be able to surge ahead of them, but, as I say, it's only if we embrace the fourth industrial revolution.