5. Will the Minister make a statement on the benefits of focusing on the foundational economy? OAQ53627

Yes. A focus on the foundational economy will support our wider aims for inclusive growth, contribute to place-based economic development and help promote grounded and responsible firms.

Grounded and responsible firms—and those grounded and responsible firms can actually tie into the strategy that Leanne Wood raised earlier of environmental benefit, particularly where they grow locally based, locally sourced supply chains in the foundational sector, which can reduce carbon footprints. We had Redrow housing in our Economy, Infrastructure and Skills Committee last week and asked them if they'd made any assessment of the impact on local supply chains, and they said, no, they'd made no assessment whatsoever of their impact on local supply chains. Therefore, is it not the case that foundational companies, locally sourced companies, can have a very positive impact on a policy of green growth?

Thank you. I must acknowledge the role the Member has played in championing the concept of the foundational economy. I think it's important as well that he's focusing on this aspect of it, which is not an aspect that is often discussed, but I think there is great potential.

So, there are three different pillars to our work on the foundational economy. One is the experimental fund that we've agreed with Plaid Cymru as part of the budget agreement, where we're looking to see if we can increase the amount of money available for that. The second is the growth of grounded firms and filling the missing middle. And the third, then, is mainstreaming through the public sector the lessons from Preston and beyond through procurement, and that's where I think we can make real progress here, because using the public services boards set up under the Well-being of Future Generations (Wales) Act 2015, we can give them a challenge to help this agenda that will give meaning to all the principles and approaches of the future generations Act. We've also set up a sub-group of the ministerial advisory board to challenge us and test us as we develop our thinking in the foundational economy, and we're going to be receiving a paper specifically on environmental growth and biodiversity at our next meeting, to see how we can embed those principles into the work we're doing. I'd welcome the continued support and input and challenge from the Member as we develop this agenda.

I think that between your answer, Minister, and Hefin David's question you've pretty much touched on all aspects of my knowledge of the foundational economy. At the very end there you mentioned procurement, and it was only the other week in spokesperson's questions that I asked the Minister for Finance and procurement about the valuable role of procurement in developing local supply chains and growing the Welsh foundational economy, if that's a phrase we want to use. So, can you tell us a little bit more, elaborate a little bit more, on the last part of your answer there and how you intend to make sure that the Welsh Government's procurement policy does support those locally based, hopefully green industries that are the industries of now, but also the industries of the future?

Yes, the Minister for Finance and I are working closely together on this. There's a review being carried out of the National Procurement Service and as we look to reshape that, we want to make sure that the principles of the foundational economy are embedded in what comes next, and we're talking to the public services boards about how they can pilot some different approaches, building on the experience of Preston and other areas where there's been—I forget the term they use. It's gone from my head—[Interruption.] Community wealth building—thank you very much—working closely with the Minister as well as the Finance Minister. [Interruption.] Absolutely—seamless. Community wealth building, which is a—. The two terms are used interchangeably—the foundational economy and community wealth building. Community wealth building has a slightly broader focus, because that can focus not just on procurement, but on property and workforce and other aspects that will be different to different areas.