The next item, therefore, is the statement by the Minister for Economy, Transport and North Wales on the response to coronavirus. And before I call the Minister, can I confirm that the Deputy Presiding Officer will take the Chair for this statement? So, I call on the Minister to make his statement—Vaughan Gething. No, not Vaughan Gething, Ken Skates. [Interruption.]

I think Vaughan Gething needs to turn his microphone off. Vaughan Gething needs to turn his microphone off.

Can we ask Members, particularly the health and social services Minister—? Thank you. Sorry, Llywydd.

That's okay. I call on the Minister for economy to make his statement—Ken Skates. Can I just pause there? Can we have confirmation that the microphone for the Minister is now switched on, and that he can be heard? [Interruption.] We'll take a technical break for one minute, while we resume the Minister's microphone—Ken Skates's microphone.

Plenary was suspended at 15:52.

The Assembly reconvened at 15:53, with the Llywydd (Elin Jones) in the Chair.

Okay, we are resuming the session, and I now call on the Minister for economy to make his statement—Ken Skates.

The Deputy Presiding Officer (Ann Jones) took the Chair.

Diolch, Llywydd. I'd like to start by thanking Members across the Chamber for the very positive discussions that I've had with colleagues, right across all parties, in the last few weeks. Some very constructive ideas have come from those discussions, many of which we've used to shape the support that we are now providing to businesses across Wales, and to individuals as well. So, I want Members to know just how very grateful I am for that advice and counsel.

Now, there can be no doubt of the scale of the economic challenge that lies ahead of us. The Office for Budget Responsibility’s reference scenario depicts UK gross domestic product falling by 35 per cent in the second quarter of this year. So there is no avoiding a recession, but if we are to avert a major depression, it is absolutely imperative that Governments across the UK do everything in their power to shelter business through the storm, and protect workers from the very great threat of unemployment.

Now, as a Welsh Government, we've made a commitment to play our part in that work. It is why we have re-examined our budgets and made tough decisions, right across Government, to put in place a new £0.5 billion economic resilience fund. Our fund provides significant financial support that is additional to that provided by the UK Government. It provides vital support for businesses, particularly those small and medium-sized firms that are so critical to the Welsh economy, and that isn’t available to firms in England. We've done this because we want to support good businesses in 2019 to be good businesses in 2021. We want to support people who had a good job in 2019 to have a good job in 2021.

So, last Friday, we opened the application process for the fund. The rate of applications in the days since has been unprecedented. More than 6,000 grant applications were received within just 24 hours of the launch. And as of 6 a.m. this morning, the economic resilience fund has received 5,842 microbusiness applications, totalling £56.7 million, and 2,267 SME applications that have totalled £127.3 million. So, overall, the total is 8,109 applications, totalling £184 million.  

I think that that demand speaks to the scale of the crisis that we now find ourselves in, and that's why I was pleased on Monday of this week to have responded with pace to release a further £100 million into this current phase of the economic resilience fund. It's worth saying that this work builds on the more than £440 million-worth of business rates grants that have now reached nearly 35,000 businesses across Wales.

Local authorities, Dirprwy Lywydd, have worked with urgency and with skill to process payments and are doing a fantastic job getting funding to businesses as quickly as possible. So, I'd like to  thank every single local authority who has played a part in this work.

I'd also like to pay further tribute to the staff at both Business Wales and the Development Bank of Wales, and to my officials, who've worked tirelessly, often in difficult personal circumstances, to develop the most comprehensive package of support for businesses anywhere in the UK.

We've sought to strike the balance between supporting as many enterprises as possible and making a meaningful contribution to each one’s survival. But in doing so, we are not losing sight of our longer term ambitions: the need to decarbonise the Welsh economy, the need to increase the incidence of fair work and the need to raise the skills levels of individuals across Wales. And that is why we have asked each recipient of our support to sign up to the principles of the economic contract.

The fund and criteria will be reviewed before the next phase is released. And I'd like to welcome, in addition, the action of the UK Government in terms of the job retention scheme that is now opened, and I welcome the extension of the scheme as well until at least the end of June. 

On Monday, the UK Government announced a package of support to innovative new companies that are not eligible for existing coronavirus rescue schemes. To qualify, a company must have raised £0.25 million or more privately in the last five years. It’s important, I think, that the UK Government monitors progress of the scheme to ensure that this threshold does not deter vibrant and viable businesses from accessing support.

In Wales, start-ups that were established prior to 1 March of this year will be able to apply for the economic resilience fund if they meet, of course, the eligibility criteria. This sits alongside the already well-established and high-quality package of pre-COVID support for small businesses that is available through the Development Bank of Wales and, of course, Business Wales’s start-up loans and comprehensive advice.

So, while a lot has been done, I also should say that there is still a lot to be done. There is an urgent need to see more of the promised lending guaranteed by the UK Government, getting to the front line. The UK Government must continue to support and press the high-street banks to be far more responsive to the needs of our businesses at this incredibly difficult time. I believe that there is a lot that high-street banks could learn from our very own Development Bank of Wales in the way that it has adapted to the current period that we're in—making sure that it has adapted its own policies and processes to get funding and support to businesses without delay.

So, Dirprwy Lywydd, we are all incredibly proud of businesses all over Wales—businesses that are stepping up to support the fight against COVID and to assist our NHS. There has been an overwhelmingly positive response from the business community to our call to action on PPE. Through it, we are now seeing innovative ways of working as businesses switch to making devices and products that will make a huge difference to our health and social care staff.

Those currently furloughed or out of work, though, need support too. And that's why, on Monday, I launched our new e-learning provision aimed at improving skills and supporting mental well-being by helping individuals to prepare positively for the future, whatever that may bring. Through our new offer we have made available a range of high-quality and free online learning resources from trusted providers like the Open University. This provision is supported by online careers advice and guidance available for use by individuals across Wales via the Working Wales website.

I now look forward to taking colleagues’ questions.

Thank you very much, Minister. Russell George. Russell George?

Russell has not been unmuted. 

You need to unmute—

Okay?

There you go. 

Thank you, Deputy Presiding Officer. 

You're welcome. 

Thank you, Minister. Can I thank you for your statement, and can I also thank you for your weekly meetings with opposition spokespeople? I think they're invaluable, because they allow us to raise issues directly with you, as well as being updated. So, that's greatly appreciated, Minister. Can I genuinely welcome your statement? I think that the financial assistance being provided by both the UK Government and the Welsh Government is very good to date. And also I think it's quite right what the First Minister said earlier today in that it's important that schemes complement each other from both Governments. 

The Chancellor announced his £250 million future fund for business start-ups and the tech sector, and I wonder how you are supporting businesses in Wales to attract funding from that particular scheme. I think it's also important to take into account the Enterprise Research Centre, which published some data I think in the last couple of days, showing that Wales could be the most significantly hardest hit, as a result of the coronavirus and restrictions brought into place, and they've provided some detail with that. But, clearly, I think you said yourself, Minister, we have a higher percentage of smaller businesses here in Wales, especially in rural Wales, so I think we need to be adapting accordingly. 

The economic resilience fund was very welcome. From my perspective, I was telling businesses 10 days or two weeks ago that were contacting me: 'Please, just wait. The economic resilience fund is going to fill those gaps that are left'. I appreciate that any Government can't fill all the gaps, but I was expecting more gaps to be filled than what is currently the case, as announced. But I very much hope that you are going to bring forward further schemes that will support those existing gaps that exist, and I'm particularly thinking of—and I'll go though a few of the gaps now— VAT, for example. Businesses that are not registered for VAT—these businesses are small business; most small businesses in Wales, or a large number of them, are not going to be registered for VAT—are currently excluded from the criteria. So, it would be good to have confirmation that, in the next phase of the scheme, those businesses are going to be serviced. I know that Paul Davies raised this with the First Minister earlier on, but the First Minister didn't give any detailed answer at that point. 

There's still the issue of those who are self-employed, sole traders who recently have become self-employed, and aren't able to produce accounts. And there's also the issue of those who haven't been able to put in tax returns yet or with an irregular turnover. I am particularly thinking of businesses that may invoice, so they had work in January, February, and invoices went out and they're now being paid in March and April, but they've currently got no work coming in. So, they aren't able to meet the criteria that's been set in the current EDF funding with regard to 40 per cent reduction loss in turnover or profit. 

Then, there are some issues around business rates that I hope you can address. I appreciate that this crosses over with your colleague, the finance Minister, but there are many businesses that are excluded, and it does seem to me that there needs to be some degree of tapering or accommodation for this. There are businesses, for example, with a rateable value of £12,500, that are excluded, whilst businesses with a rateable value of just a little bit less are receiving £10,000 in grant money, and there are businesses in the hospitality sector, for example, with a rateable value—. I know one with a £53,000 rating that's not able to receive any funding at all, whilst a business with just a rateable value of £49,000-odd would receive £25,000 grant funding. So, what degree of tapering might come forward in future Welsh Government initiatives of business rate relief?

On business rate relief as well, I'm very pleased that the Welsh Government got the money out to local authorities quickly, but there are some differences between local authorities in how they are delivering the funding direct to businesses, unfortunately. Some local authorities are doing well, such as Powys County Council in my own area, which got the money out very, very quickly. So, I very much commend that. But some local authorities are just not getting that money out, and other systems are far more bureaucratic.

The tourism sector—I know it's been mentioned earlier today. There's been a significant downturn in this particular sector, and I wonder what further Government support you can confirm that will come forward to support this particular sector. Obviously, very crucial. And also, businesses that have a seasonal turnover as well, especially some that need do demonstrate a loss in profit. Clearly, some won't be able to do that because of the seasonal nature.

Also, coming to the end, the recovery phase. If you could just confirm that the economic resilience fund is just for the here and now, or is it for the longer term? I assume that it's just for the here and now, and that the Government's going to come forward with a further larger package in terms of how we move beyond the current phase, and we get support out to help businesses change their business models, innovate through technology, et cetera.

And finally, the Development Bank for Wales—I'm very pleased that they got loans out quickly to people. It’s a good news story, perhaps, to a degree, that many businesses have been supported. But, of course, the funds have dried up, so what other additional funds can the Welsh Government lever in itself from its own resources or the UK Government's or European funding as well?

Thank you. Minister.

Thank you, Deputy Presiding Officer, and can I thank Russell George, both for his kind remarks at the beginning and for the questions that he's asked? I think the way that you, Russell, Helen Mary, David and I have been able to work over the last month shows that you can operate in a collegiate way across political parties without losing strong scrutiny of Government as well. So, I am very grateful for the way that we've been able to work together in assessing what is best for the country.

In terms of the questions that have been asked, I'll try to run through them in the order that they were asked. First of all, the future fund—the fund that was announced for start-ups. I've already said that there is a difficulty within the criteria for Welsh start-ups regarding the requirement to have raised £0.25 million privately in the last five years, and on top of that, of course, then money put in by the UK Government has to be matched by private investors, but if the money isn't repaid, then the UK Government will take an ownership stake in the company.

I know that the Government has reviewed the coronavirus business interruption loan scheme. I'm hopeful that it is monitoring very closely how effective this particular scheme is as well and, should it transpire that further revisions are required here, that it will make the necessary changes in order to assist businesses across the country, because at the moment, there is a risk that it would benefit primarily those in London.

It has to be said, though, that there are other alternatives that are impressing— that UK Government Ministers are considering, including using the existing research and development tax relief regime to bring forward the payment of significant sums of money. The money is already in the system, but it could be advanced sooner to support businesses.

It's worth saying that start-ups that were established prior to 1 March 2020 can apply for the economic resilience fund if they meet the criteria. So, that support is available to them, and that's additional, of course, over what businesses and start-ups would have in England. The development bank itself operates its two specific funds to assist with start-ups and specific sector, tech start-ups.

Now, in terms of the ERF, you are right to assume that this particular fund is for the rescue stage. As we now look at resetting the economy and recovering from COVID-19, we'll look at the most appropriate means of supporting businesses moving forward. That second phase of that tranche of £100 million will enable us to look at some of the remaining gaps and you've highlighted a number of them.

One of the biggest gaps that has occupied our thinking is the non-VAT registered microbusiness. Now, the reason that we built in that particular piece of criteria into phase 1 of ERF was to avoid significant fraud, because it enabled us to check the address of a business, the existence of a business. Moving forward, the Scottish Government have introduced a model that we were considering, which is essentially a bursary. That might be the option that we settle on. But one thing is for sure: we wish to address that particular segment of the economy.

In terms of sole traders that have recently taken up employment and some of the other gaps that Russell George highlighted, in many respects, these are welfare matters that may require the attention of officials who are concerned with the discretionary assistance fund, and across departments, we're looking at how we can utilise an enhanced discretionary assistance fund for the purpose of filling in some of these gaps. 

We had to set cut-offs at some point in terms of the level of grants that businesses would receive. In terms of tapering rates relief in the future, it's something that I'll certainly be discussing with my colleagues, principally the finance Minister. And I'd share Russell George's congratulations of Powys council, which has, I think, consistently, week on week, been at the front of getting grants out to businesses. In the first few days, I think within the first week, they managed to administer 2,000 grants, which was very impressive.

The UK Government has indicated that it will be publishing all of the English councils' performance, and given that that is likely to happen very soon across the border, I think it makes sense that we consider it here, but I've also asked UK Government to publish, if you like, a league table for the high-street back-ups with regard to the coronavirus business interruption loan scheme, so that we can check which of the banks really are stepping up and which are failing their customers.

The next stage of the Development Bank of Wales COVID-19 loan scheme could attract money from UK Government. We've certainly asked for it and the development bank itself has applied to become a CBILS lender. That would provide huge opportunity in terms of being able to provide more money sooner for Welsh businesses. It's quite a staggering fact that the Development Bank of Wales, in contrast to what's happening with CBILS, has assured us that it will be able to get money out of the door for all of the successful applicants by the end of this month. That's a pretty impressive achievement if they are able to deliver on that.

There will be, as we consider the reset and recovery, there will be huge opportunities. Of course, certain sectors will contract, certain sectors will change considerably, but there will also be many opportunities, and we wish to make sure that we've got the support mechanisms. There's a huge amount of thought at the moment going into this concerning how we can embrace and exploit emerging opportunities that will be driven largely by behavioural change. 

Russell George has identified one particular sector that will require a lengthier period of support—that being the visitor economy. I've already taken up a UK Government Minister's concern of the tourism sector and other sectors and sub-sectors that will likely require further support in the months ahead, particularly with regard to the job retention scheme.

I'm also aware of many conversations that have taken place that are involving the Deputy Minister for Culture, Sport and Tourism on a UK basis to examine what sector-wide support may be offered across Great Britain and Northern Ireland. There is a need, I think, once we begin to emerge from coronavirus, to consider what protocols as well need to be introduced in order to safely resume the visitor economy across Wales. Those protocols, if they were to be certified, could give assurance to customers and to visitors that businesses are complying with post-COVID-19 requirements in order to operate successfully, and I think that's the safest way to resume activities in this important sector.

Can I begin by echoing what Russell George has said and thank the Minister and, indeed, his staff, who have been very responsive to specific concerns that I and my colleagues have raised and also very open to new ideas and new suggestions? I would submit that this is a very positive model for the way in which a Government ought to be engaging with constructive opposition at this time, and I really appreciate the Minister for making sure that that's happened.

If I may just briefly raise some specific issues. I was very pleased to hear the Minister say that the economic resilience fund—he is very conscious that it doesn't meet all the businesses he'd like it to, particularly those businesses that don't register for VAT. I'm very pleased to hear him say that that will be kept under review. I wonder if the Minister can give us an indication today about when that might be able to happen, because as I know he's aware, those very small businesses are ones who may have less put by, they may be more vulnerable and arguably may need help more quickly than larger businesses that might have more robust relationships with their banks. And speaking of banks, I want to particularly welcome what the Minister has said about, as it were, a league table for the high-street banks, about those who are being helpful and those who are not. I'd say, more broadly, I think, that the people of Wales will remember those big businesses who conducted themselves well and they will remember those that have not, and I'm sure the Minister will agree with me about that.

In his statement, the Minister mentions the UK Government's furlough scheme, the job retention scheme, and I know that we're all very pleased that that's in place, but the Minister is aware that there are some issues, and there are some gaps, and I'm grateful for the opportunity that he's given me to provide him with some evidence about particularly those people who are left behind because they've changed employment at this time—their previous employers won't furlough them, sometimes perhaps because they left without leaving a positive relationship, and new employers who would wish to do so. I wonder if the Minister can update us this afternoon about the discussions that I know he's been having with the UK Government about this, and whether he feels that there is a possibility, now the main scheme is in place—the most obvious evidence being payroll—that there is any possibility of flexibility. And, finally, the Minister has acknowledged in his responses to Russell George that there are still some gaps, and I would say, in this context, that when you're making these big steps so quickly, there will be gaps; I don't think anybody is surprised in that.

Now, when the First Minister was questioned about related issues and thinking about where the gaps are and how they are to be filled, the First Minister talked about pressing the UK Government to fill those gaps, and I'm sure none of us would disagree with that, and we all acknowledge, of course, the limited resources available to the Welsh Government. But in the past, the Minister has said—and I think he has said really this afternoon in response to Russell George—that he will look to plug some of those gaps with Wales-only schemes if he has to.

I was interested to hear him again refer to the assistance fund, the discretionary assistance fund, and I wonder whether he can give some further consideration to using that fund to provide an emergency basic income to some of those people who will be falling through the gaps, because we can't make furlough schemes for everybody, and when he thinks he will have an assessment of how many businesses and how many individual sole traders are falling through the gaps and how soon a new scheme might be able to be in place to support them. Thank you.

Can I thank Helen Mary Jones again for her very kind and generous comments and the questions asked? We certainly don't have a monopoly on ideas within Welsh Government. We are seeking views, ideas and innovation from far and wide, and I've got to say, we have had a lot of constructive ideas from Members across the Chamber. I'm incredibly grateful to Helen Mary for those ideas and the intelligence as well that she and her office have been able to provide during this time.

Just reflecting on the group of individuals and small businesses that are falling through the gap regarding VAT registration, my aim is to detail phase 2 of the ERF in the coming 10 days to two weeks, so that we can essentially have a seamless movement from ERF phase 1 into phase 2, recognising that the current phase, with a requirement of, or an application total of over £180 million, will not last a significant length of time beyond—[Inaudible.] So, I do not wish to have a gap between phase 1 and phase 2 if it can be avoided. And I think you're absolutely right regarding the performance of high-street banks. Memories will live very long from this experience and people will judge and then make decisions on the basis of the performance of high-street banks and others. I do think it's right that the UK Government, if it's choosing to publish, if you like, a league table for local authority performance in England, also does the same with the banks. It's only fair, in my view, that that should be applied.

In terms of furlough—the reason I raise furlough is because, Helen Mary, you've identified a group of individuals who have fallen through the crack in terms of the cut-off date. We've been supported by the Scottish Government in our call for the date to be pushed back to 1 April. That would also capture a significant number of people who are seasonal workers within the visitor economy. I have to say, the discussions that I have with Ministers in the UK Government are always very amicable, constructive, they're open to our ideas, and, indeed, they've been able to announce changes to certain support packages based on our recommendations, based on the intelligence that we've been getting. So, they're currently considering that further extension to 1 April. A quad-call took place this afternoon during Plenary; I wasn't able to be on it so my colleague Lee Waters took my place. If there is any news about a possible extension to furlough that has come back from as a consequence of that call, I'll make sure that that information is shared with Members.

I just want to pick up on the question about to what extent we should be plugging gaps left by UK Government activities. There is only so much we can do with our finite resource. The UK Government really needs to be seen as the Government that has the extraordinarily deep pockets that we do not have, but that's not to say to say that we can't intervene in a Wales-only way—that's precisely what we did with the £0.5 billion economy resilience fund. Normally we spend—through the business and regions division of Government, business support and investment—about £30 million a year, so I do think that £500 million, £0.5 billion, demonstrates the scale of what we've done. But I think, when it comes to support such as an emergency basic income scheme, that would be incredibly expensive, probably unaffordable for the Welsh Government, certainly given the commitments we've already made. Trying to find the quantum of money that would be required for that would be nigh on impossible, but it is something that we have said to the UK Government should most certainly be considered. We're looking at how we can use the discretionary assistance fund to support more people. The demand for DAF at the moment is quite incredible, so even if we were to significantly increase the amount of money that's available through the DAF, it would not replicate, it would not offer what an alternative, emergency basic income scheme would offer. That's why we've been pretty consistent and clear in saying to the UK Government, 'Look, you can introduce this emergency scheme, it can be time-limited, but it will make a massive difference to very, very vulnerable people who are currently falling through the gaps.'

I'm being contacted by sole traders—driving instructors, photographers, plumbers—whose work has just ended. They've made enquiries and they've been told there is no support for them within the current system. Is that correct, and if it's not correct, can you ask whoever's giving that information out to tell them what support there is for them, because these are people who have just lost the whole of their income?

The second point I'd like to raise is about having a strategy for each economic sector. If I look at retail, for example, there are some companies who have never had it so good—online retailers and food retailers who don't have to have any special offers because they've just got a queue forming outside. They've never had it so good, it's like Christmas every week, whereas you've got other retailers who are doing no retail whatsoever.

We're seeing one major retailer failing each week, and I expect there to be far more than that of local retailers, who just will not be able to reopen. Is there anything that can be done to support some of these smaller retailers? We know their rates have gone—they've still got their rent and they've still got the other overheads. There's all of these payments they've got to make in order to just keep their building.

Can I thank Mike Hedges for his contribution? I think in terms of support for those who have just recently found they've got a massive fall in their turnover, their income, as a consequence of coronavirus, they can check their eligibility through Business Wales—the online portal—for the economic resilience fund. There's also the support from the UK Government for the self-employed.

I can't comment on each and every sector at this time, and each and every business that may find themselves struggling to identify whether there is support available. The best way for a business to do that for sure is to go over to the Business Wales website and to look at the various schemes that are available there. Specifically with regard to the ERF, which is linked—the criteria are linked—to significant reductions in turnover, there is an eligibility tool that is very simple. A sole trader could go through it in a matter of minutes to be able to ascertain whether they'd be eligible for that support or any other support that Business Wales is providing advice on.

In terms of the retail sector, this is another sector that, in all likelihood, will require a lengthier period of support from Governments. There is no doubt whatsoever, though, that because of behaviour change that's going to be inspired by this period, there will be a further acceleration of the shift towards a lot of online retail. That will have knock-on effects for the nature of the high street—what a high street or what a town centre is actually going to be for in the years to come. So, work is under way in the housing and local government department concerning the town-centre-first approach, and how we can reshape town centres against this new pressure of coronavirus and the likely impact that it will have on long-term consumer trends.

That said, we are also working on the retail sector—specifically, this is work in north Wales, where we've drawn together local authorities, the economic ambition board, the retail sector itself and Welsh Government on a piece of work that has three strands to it, which includes the future of the high street. I would certainly consider extending this piece of work to the other three regions of Wales, because I think it's going to be a vital, vital concern for local authorities, for Welsh Government and for the sector.

Thank you. David Rowlands. Can somebody unmute Mr Rowlands's microphone? There we go.

Okay, I've done it myself. Fine.

Thank you very much, Minister, for your statement this afternoon, but also can I thank you for the regular weekly updates we get as spokespersons, which are very comprehensive and, in fact, leave very little wriggle room for questions, if I could say that?

Can I also say that I think that many of the agencies you're using for the interventions, particularly local authorities, and the Development Bank of Wales in particular—can we all thank them for the tremendous work they are doing? It's without doubt that they are stepping up to the plate.

I would like to reiterate quite a few things that Helen Mary Jones and Russell George said with regard to the ability of certain sectors to access funds. It's very difficult to know exactly where the gaps are, and we appreciate that, and also the fact that we have to remember that this is public money and there must be safeguards with regard to the scrutiny of people applying for those funds. So, we realise that there may be delays in those funds coming through.

One of the areas that I want to specifically ask about is the construction industry, where there seems to be a very mixed bag of what's going on in the construction industry. For instance, what is happening on the A465 at this moment? Is there still progress going on there or are the works closed down? What's coming back to you from the construction industry with regard to what's happening with the COVID-19 crisis?

Thank you. Minister.

Can I thank David Rowlands, Deputy Presiding Officer, for his questions, and again for his kind comments too regarding the discussions that we've had, and the contributions that Members across all parties have made in our fight against coronavirus?

I'll certainly pass on his thanks, which I'm sure are reflected across the Chamber, to local authorities, to the development bank and to Business Wales. The pressure that people within those organisations are under is quite incredible and often they are forgotten. Equally, civil servants—the pressure that they're under is just incredibly intense right now and, again, they're often not remembered amongst the applause for critical workers, but they really are doing their utmost to keep people safe and to keep our economy as healthy as it can be.

So, we're seeing actually that the Business Wales website is getting around about 0.5 million hits a week at the moment. It's quite incredible, the traffic to that site, and their staff are taking around about 250 to 300 calls each day—a really good committed team of over 40 people who are showing incredible compassion to people who are really stressed and anxious at the moment, trying to keep their businesses afloat.

Just moving on to how we spend the money, of course, you're right, we have to be concerned with fraudulent attempts to extract public money from the Welsh Government, and I've highlighted one particular area of support that have the criteria set in a way that would prevent fraudulent applications being made. It was the non-VAT registered group that unfortunately suffered as a consequence, but who we aim to be assisting in phase 2. But then there's the additional question of what sort of value—over and above keeping that company alive, keeping those people in employment—we're actually getting for the investment. 

Well, I'm pleased that we've been able to introduce the economic contract into the grants process. We want to make sure we get maximum value for investment. We will be revisiting those businesses in the months to come, ensuring that they can demonstrate how they've been able to decarbonise, what they've done, in the time since signing the economic contract, to improve the health and mental health and skills of the workforce, and how they've grown as well, because we want to make sure that we invest in those businesses that are viable for the future, that are responsible businesses.

I'm going to turn briefly, if I may, to the construction sector. We've been obviously engaged in discussions across all four nations regarding construction sites and in terms of ensuring that advice for workers is as clear and accessible as possible. But the picture, as you've alluded to, David Rowlands, is not 100 per cent clear and there are currently different interpretations across all four nations, and amongst the companies, which is not entirely helpful.

The regulations that we've published with the supplementary guidance, I think provide probably the clearest guidance anywhere in the UK. And, as a consequence of that, I've had discussions with the likes of the Civil Engineering Contractors Association and skills bodies representing the construction sector. As a result of that, I think we have seen construction in a number of areas being maintained in order to support the health and economic effort that's under way right now. So, for example, construction of the Grange hospital is continuing—it's close to completion. That will provide an extra 350 invaluable hospital beds. It's right that that construction project should be completed; the A465 as well—a vital piece of economic infrastructure that will be at the heart of the regional economy and the resurgence from coronavirus in the years to come.

Other projects such as Caernarfon's Bontnewydd bypass as well, we wish to see delivered in the time frame that it was meant to be delivered, because it is of such importance to communities and to the local economy. However, that guidance must be adhered to at all times on construction sites.

I think it's also fair to say that construction will play a pivotal role in the recovery phase. We know that investment in infrastructure can provide the fastest way to grow an economy out of a recession, and we are now facing a recession. So, we're looking at how we can use not just large-scale construction projects but often smaller scale projects that benefit supply chains a little more in order to maintain work now, but also to expand employment opportunities as soon as we can, once we're through this virus.

Thank you very much. Can I just put the usual statement out that we've had a major speaker from each of the parties, so can the rest of you just ask your questions? We've got a number of people who want to ask their questions of the Minister for economy, so it's really down to you as to how many I can call. Nick Ramsay.

[Inaudible.]—Dirprwy Lywydd, and can I concur with previous sentiments that we're thinking of those on the front line at the moment in our public services? And I know that the Minister for economy has stated that as well.

If I could just ask a couple of questions about the economy specifically, then transport, Minister. First of all, a number of speakers, including Russ George, have spoken about the problem of some businesses that feel that they're falling through the gaps, as it were. One of those that I spoke to recently, one business owner, is concerned that, if you qualify for rate relief, that can exclude you from the resilience fund and you can go around in circles. So, I wonder if you could clarify the situation there.

Also, I've been contacted by the owner of a soft play centre in Abergavenny only today, and she's had concerns about the criteria for applying for emergency funding, on the basis that I think you either have to be hospitality or leisure, and her business fits into neither of those. In fact, it probably fits into both and, clearly, a soft play centre, it may be something that isn't seen as important as other facilities at certain points in time, but, of course, parents, children, when we come out of this problem time that we're in, those people will be relying on it; parents will be relying on that sort of educational and play experience for their children. So, I wonder if you could look again at the categories and those businesses that might not fit strictly into one category.

And, finally on the economy, the self-employed—a local businessman, again concerned that, to be eligible for Welsh Government emergency funding, you have to have an average profit, I think, or show an average profit, over three years, and he was concerned that, actually, it's the last year that is most specific to him. So, I don't know whether you could, or ask your officials to, look into whether there could be some exceptions made in terms of the profitability of businesses.

Secondly, the second area I wanted to just mention briefly was transport and PPE availability. Firstly, public transport: a key worker at the Heath hospital who I know waited 75 minutes the other night for a bus home. I just wonder what's being done to support the bus industry at this time, particularly when it comes to our key workers and providing them transport back and forth; they're on the front line. And, of course, the bus drivers themselves and the staff with Transport for Wales—they're on the front line as well, and I wonder whether PPE has been considered for them. I know there are stresses and strains on that at the moment, but that might be something to look at going forward.

And the haulage industry, which some speakers have mentioned, and delivery drivers—Amazon and the like—they're working very hard for companies at the moment, and they are, probably, in many cases, keeping the economy moving in terms of people getting their supplies and people getting their shopping. So, I just wonder what help is being made available to companies like that to provide adequate protection for their drivers and for their staff.

Very finally, Minister, on the issue of social distancing, it's a very difficult thing to achieve on public transport, so I just wonder how you're liaising with Transport for Wales to make sure that, when it does come to this, and, indeed, when we do start coming out of the lockdown, as, hopefully, we will at some point, if there are still any social distancing implications in place, then Transport for Wales and public transport will be given the sort of support and guidance that they need.

Can I thank Nick Ramsay for his questions? I'll turn to the economy questions first of all, and, in terms of the enquiries that he's had from a soft play company, I've had an incredible number of enquiries from soft play businesses that have found themselves in a similar position. It is true that they're not classed as leisure or retail or hospitality, and so they weren't able to benefit from the initial round of support. We were aware of this when we developed the ERF, and, for the most part, soft play businesses are microbusinesses or small or medium-sized enterprises. A huge number of them employ no more than nine people, so they're classed as microbusinesses. They are, for the most part, VAT registered. They've suffered, by and large, a fall of 40 per cent or more, and so they are eligible, I believe, for the microbusiness element of the economic resilience fund. That's certainly where we've been pointing soft play businesses to for appropriate support, and those details are available on Business Wales's website.

We'll take up the last question that you raised regarding the economy and how we might be able to support people who have been operating for three years, but whose profitability performance has varied quite significantly over those three years. I'll ask officials to pick up on that.

In terms of transport, we have, of course, provided the bus industry with the hardship fund. After we announced that, the UK Government made an announcement that, essentially, ensured that Scotland, Wales and England were offering the same degree of support to bus operators during this time. But we're obviously, as you can imagine, now considering how to support buses as we emerge from coronavirus, how we, as you've identified, ensure that social distancing on bus services can be maintained and what sort of support would be required to the sector in order to maintain that, with the inevitable consequence that it has in terms of the hit on the fare box, particularly for those commercially viable routes. That's something that we're actively considering now. I had a conference call with WLGA transport and economy leads this morning, and I identified a number of work streams that are taking place at the moment, and it's my intention to work with local authority partners and with the likes of the Confederation of Passanger Transport to ensure that we get the appropriate support for the industry in the future and that we develop a model for local bus services that is fit for the future as well, given that we will probably see behavioural change exist for at least the next 12 months, if not 24 months, which would and could and probably will lead to reduced patronage on bus services. That means that we have to make sure that we bring forward some of the radical ideas that we published in the White Paper, so that we're able to address some of the perception issues of bus services in order to try to drive up patronage amongst new customers, new travellers, whilst we see some existing travellers decide not to take buses because of what's happened with coronavirus, because they're fearful of getting too close to other passengers.

There are some industry best practice standards that have been developed—for example, cordoning off seats so that nobody sits within close proximity to one another, so that people are kept away from bus drivers. I have heard that, for the most part, bus companies themselves have been very responsible in ensuring that drivers are given some protection in the form of hand sanitisers and so forth. Equally, though, I have heard of one or two cases where employers have not been as responsible as the industry, and certainly as we, would expect. This is something that's been raised directly with them.

We're in very, very close contact, as you can imagine, with Transport for Wales over how we're going to be able to ensure that we can maintain social distancing rules once we start to emerge from coronavirus. That will obviously have an impact in terms of rolling stock provision on the most demanding lines—those lines where capacity has already been reached. This is something we're considering at the moment. Again, based on the evidence that we've been able to gather, we expect that behavioural change will lead to, at least in the short term, a drop in patronage on our railways, and we're working with TfW Rail Services in assessing how that will impact on the agreement that was reached just a few years ago on the franchise.

I think that covers pretty much everything, apart from the important point that Nick Ramsay raised about drivers, and how the private sector is also ensuring that employees are given the protection that they need. Again, there are—albeit anecdotally—varying standards that are being adopted by delivery companies. I'm keen to make sure that as we reset the economy and then as we recover from coronavirus, we develop—and I'll be very, very keen to ensure that the sectors themselves are leading on this—develop clear protocols that can be applied consistently, if possible, across the UK, which will enable a consistent approach to be applied both within the public and the private sector, so that standards in terms of social distancing for the public sector on transport can be applied also to the sort of standards that would need to be met for and on behalf of and by delivery drivers as well.

Thank you. Can I again appeal to Members? We're out of time on this statement. I will extend it to get a few more backbenchers in on this.

Apologies.

Thank you. I'm glad you recognise—. So, can we just say short questions, shorter answers, and perhaps I'll get a few more of you in? David Rees.

Thank you, Dirprwy Lywydd. Minister, could I also thank you for the actions you've taken as a Welsh Government to fill some of the gaps that the UK Government's business support created? It's important that we manage those businesses that are in those gaps, but as you rightly pointed out, there are still some gaps. You've answered many questions I would have wanted to raise for my colleagues on those, so I'll stick to just two points. One: there are many businesses that were supplying or had clients in both the hospitality and leisure industries, but are not directly themselves in those industries. Because their clients are no longer there, they are now losing income, and therefore they are struggling, and they were not included in the rate support or any aspect of the business support. Will you look particularly at those types of businesses to ensure that they're not getting lost? Because they were very productive in 2019, they will need to be there in 2021, and we don't want to see those types of businesses being lost as a consequence of their clients being supported, but them not being supported. That's one.

And secondly, clearly, I have a very keen interest in the steel industry, as you know. It appears that the coronavirus business interruption loan scheme aspect of the UK Government also is not going to include the steel sector in that. Will you meet with the UK Government, Minister, to see what can be done for industries such as Tata and others who are perhaps in the larger sector of the economy, but are struggling again because their clients are not having demand for steel as a consequence of the actions, and they're going to struggle? So they will be needing some support, but again, they are again falling outside the criteria. So we look at the UK Government agenda on that, because that is a business support question for the UK Government, but you need to press the case for that sector in Wales.

I thank Dai Rees for his questions. In terms of steel, this is something that is being raised by us on a weekly basis with the Department for Business, Energy and Industrial Strategy, and I'm pleased that, during the course of recognising that CBILS was not supporting all businesses, and not supporting in particular that missing middle of businesses with a turnover of £45 million, revisions were made to enable support to be forthcoming. In addition, the limit of a £25 million loan has been reviewed, and I'm pleased that our call for that to be increased has been agreed to, but we are continually pressing the UK Government to ensure that there is recognition that Tata in particular is in need of support. We will do what we can in the Welsh Government to support Tata and its many sites in Wales, but UK Government clearly has a key role in supporting this sector, and Tata in particular, and we've said to the UK Government on numerous occasions now that an intervention concerning steel can't then just lead to a Barnettised share for the Welsh Government, because that would lead to nowhere in terms of the size of the steel sector in Wales compared to the UK as a whole. So, it needs to be a UK-led initiative to assist that particular sector.

You're right, we are constantly trying to fill gaps. I'm pleased to say that, as a result of the economic resilience fund and the other funds that we've been able to deliver, we've been able to support directly almost one fifth of Welsh businesses now, and that is in addition to the UK Government's schemes, the job retention schemes and support for the self-employed, which have benefited many, many more.

In terms of the suppliers to the hospitality sector, you're absolutely right, Dai, there are a large number of businesses that fell out of the sector categorisation to be able to draw down the initial tranche of support, but through the economic resilience fund, they would be eligible because, of course, they're microbusinesses and there's no doubt that they've seen their turnover fall by at least 40 per cent. In all likelihood, if they're supplying predominantly or primarily to the hospitality sector and they're a small or medium-sized enterprise, then they will have seen their turnover down by more than 60 per cent. So the economic resilience fund was designed with those suppliers to those key sectors that have pretty much hibernated in mind. 

The Minister said in his statement that whilst a lot has been done, there's still a lot to do, and that's certainly true. The Government has effectively put most of the economy into a kind of medically induced coma and many businesses fear, with some justification, they're not going to come out of that coma alive, so it's vitally important that we start the gradual process of lifting restrictions as soon as we can and in the smartest way possible, so that we protect the public's health as well as the health of the economy. 

In Mid and West Wales, we've got huge dependence on farming, tourism, hospitality, et cetera, and a lot of these businesses are going to fall through the gaps, which have been mentioned already, in the various funds that are available to try to cope with the consequences of the lockdown. Farms, for example, are excluded from the economic resilience fund, as I understand it, because they are almost, by definition, in receipt of publicly funded grants through the common agricultural policy. And yet we've seen the dairy industry face a 25 to 30 per cent fall in demand for milk, we've seen the livestock sector similarly suffering with high-end high-value cuts of meat no longer being used by hotels, restaurants, et cetera. A lot of these businesses are going to be on the margins, and they can't be helped under the existing schemes. 

Similarly, I was very disappointed to hear that the reason for using the VAT threshold as a qualification for applications for the ERF was due to fraud. There are many, many ways of countering fraud apart from looking at the information that is available to the VAT authorities. So I hope that that's going to be reconsidered. Let me give you one example of a business that is certainly not fraudulent but is a microbusiness: the Penmaenpool toll bridge near Dolgellau isn't going anywhere and the people who own the bridge aren't going anywhere either, but they fall through all these gaps because they're not registered for VAT. They're wholly dependent on income from tourism to keep the bridge going. It's a tourist attraction. A lot of businesses like that are just going to go out of business unless some help reaches them pretty soon. So I hope that the Minister will take a more flexible view of this in his reconsideration of the existing rules and, in a couple of weeks' time, come up with some kind of more flexible discretionary scheme, whereby, because we won't cover every possible example in a set of rules, there'll be some kind of discretionary mechanism whereby businesses that fall through the gaps can be reconsidered. 

Can I thank Neil Hamilton for his questions and say that the idea of a bursary would be a discretionary scheme? That's something that we're actively looking at. We've relaxed our attitude to risk, and that includes the risk of fraud, in order to get money out of the door as fast as possible to as many as possible. But in terms of the ERF, I've already outlined how there have already been 8,100 and something applications that need to be processed as fast as possible. Ensuring that we do that with the minimum number of fraudulent cases, it made sense to apply the VAT criteria, but we were very clear when we launched ERF phase 1 that we were also looking at how we can assist in phase 2 those who are not VAT registered, and we will do that with the second phase. But I would want to make sure that we avoid widespread and significant fraud, because every £10,000 grant that goes to a fraudulent applicant is £10,000 that will not go to microbusinesses that could survive in Wales. So, it's absolutely vital that we do get the money to proper, decent businesses that do truly exist, and not fraudsters. 

I prefer to use the term 'hibernation' rather than 'coma', but your point is correct; that's precisely what we're trying to do. We effectively put certain sectors into a state of hibernation, making sure, working with the UK Government, that they can survive and that their employees are getting some income during the coronavirus period. They can then be woken as we deliver a phased emergence from coronavirus, and it's our intention to ensure that that emergence is conducted on the basis of activities and sectors, rather than on a place-based or age-related basis.

It's worth saying with regard to farms, farms that have diversified and have additional businesses can apply for the ERF, but for the reasons that Neil Hamilton has already outlined, farms that have not diversified are not eligible. I'm aware with regard to the dairy sector, having spoken to Calon Wen, having spoken with other businesses that are operating in this sector, and I'm aware of the tremendous struggle that is taking place right now. We don't have any drying facilities as far as I'm aware in the UK, so there is concern that milk will be poured away. We're seeing the gate price fall to an incredibly low rate. That's pretty unacceptable in my view, given that dairy farmers are contributing so much to the effort to keep people healthy right now. And so, I've raised the plight of the dairy sector in my weekly calls with the Secretary of State for Wales who shares my concern as well, and also with counterparts across the devolved administrations, and of course with BEIS. I do welcome what was announced last week in terms of competition laws, but, of course, we are alive to what is a rapidly changing situation, and I'll make representations for the dairy sector in the coming weeks to UK Government, so that we can get the support that's required for it.   

I've written to you, Minister, about a number of businesses that have fallen through the gaps that everybody has been talking about in the provision to prevent unemployment and the collapse of businesses as a result of the COVID-19 pandemic. One of these businesses doesn't qualify for financial support because it's not VAT registered and run from home. Now, the business owner has tried to get finance from a bank in the form of a business interruption loan to keep the business running, but the minimum amount that they say they can lend is £25,000, and that's too much. Many other self-employed people have been in touch to say that they can't receive the financial support that's available as well, and income for most of these people now has dried up and they're surviving on savings if they've got them. These are all cases that have checked against the eligibility criteria, so how can you assist the groups of businesses and individuals that have missed out on this support? Universal income would be one solution to that, but is there something special that you can do for this particular group of people? How can you prevent these many good businesses from going to the wall? 

Can I thank Leanne for her questions? I think it's worth saying that one of the specific cases that you outlined would have been eligible for a small loan from the Development Bank of Wales. Twenty five thousand pounds may be too much; the Development Bank of Wales's COVID-19 loan scheme offers smaller loans at very favourable interest rates with a year-long holiday. Now, that's been fully subscribed, but as I said previously to earlier questions, the development bank is looking at the second phase of the COVID-19 loan fund, so it may well be that the business you highlighted will be eligible for that second phase of support. Of course, there's also the role I've alluded to of the high-street banks in this regard as well. And it's not just coronavirus business interruption loan schemes that the high-street banks have access to; they can help their existing customers in many, many ways, whether it be with favourable terms on extended overdrafts, or favourable terms in terms of loans. It's absolutely vital that high-street banks step up to the mark in this regard. And I've already outlined the rationale for not including in phase 1 of the ERF those businesses that are not VAT registered, and I've given Members assurance that this is very, very much at the forefront of our minds as we develop phase 2.

Leanne is right that, in many respects, the support that needs to be offered to people who have fallen through the gap is welfare support, and we accept in Welsh Government we have a role. The UK Government have a very significant role as well, and I've already mentioned that work is under way to examine the role of the discretionary assistance fund as far as the Welsh Government is concerned.

Thank you. Mohammad Asghar.

Thank you, Deputy Presiding Officer.

Minister, thank you very much for your statement. My point is, my very good friend in the last two weeks passed away from coronavirus, and his son died this morning, and the second son is already in the ICU in the Royal Gwent Hospital. My question to you is that I am still very surprised that no Assembly Member has mentioned the bereaved families in Wales. What is the availability of financial support for those loved ones, who are not only their loved ones but also the breadwinners of the family? What is the financial assistance that is available to those families in these days?

And, secondly, I'm also involved and in touch with so many businesses who applied to the Welsh development bank for borrowing, and there is a standard letter coming to those businesses who have already been involved in business for so many years. They've submitted the accounts and everything, and a standard letter is coming to them that they don't meet the criteria. There are no contact details for these people to go back and ask them for the criteria.

There are quite a few other questions, Minister, but I think, because we're short of time, I think, on these two areas, I would like you to explain to me how you can help them. 

Thank you. Minister. 

Thank you, and can I send my deepest sympathies to Mohammad Asghar's friends and family? It's a terrible time at the moment. I've heard many, many stories of people I work with losing loved ones. It is a tragic period, and it is very painful for those who are financially stretched. That is precisely what the discretionary assistance fund was set up to help people with—people who cannot afford to make ends meet in ordinary times, but in this period, of course, it is especially difficult.

I know the First Minister took questions earlier today regarding the costs associated with the loss of life for families. I think it's important to note that the DAF is probably the most suitable channel of support for individuals in that position. 

And, then, with regard to the standard letter that is being issued, I'm afraid that standard letters are being issued because of the speed of response that's required right now, and the need to minimise administration and bureaucracy, so that we can ensure that as many people as possible in the development bank and Business Wales, and Welsh Government and so forth, are actually at the front line administering and delivering grants and financial support. 

Criteria for support should be very, very transparent to everybody now, whether it's through the development bank, or whether it's online, provided by Business Wales, through the coronavirus portal. I would urge you, and any businesses that approach you, to first of all look at the criteria that is published online, and if there are then subsequent questions that need to be answered, then please do e-mail me. 

Thank you. And, finally, Dawn Bowden. 

Thank you, Deputy Presiding Officer. I think I'm just down to one point now, Minister, seeing as all the others have been covered. In fact, one on the VAT gap has been asked by about half a dozen Members in different ways. So, I'll skip that one and I'll go straight to my point, which is on the business insurance. Now, thank you for writing to me about that just recently, because I understand you're now going to be meeting with the insurance industry to talk to them about that. And while I fully appreciate that regulation of the insurance industry isn't devolved, I'm sure I can't be alone in having businesses contact me about the attitude being taken by insurers, causing significant stress to a number of individuals, who thought they had cover—in fact, even their own brokers thought that they had cover, but the insurance companies themselves seem to be taking a different view. It seems to be particularly prevalent in the hospitality sector, but it's not exclusively in that sector.

And if I can just give two very brief examples: one is a business interruption clause in the policy, but it then requires a letter from Government to say that the business has to close to make that condition valid. How in reality is Government in a position to provide such letters to every company in that situation, I'm not sure. And another example was where a social club had insurance to say that, if they had to close due to contagious disease, then they are covered, only to find that that clause doesn't mean a pandemic. So, therefore, they're not covered.

Can you confirm to us the best ways in which we might be able to help in terms of bringing issues to your attention that might assist you in discussions with the UK Government and the insurance industry to ensure that insurance companies are not wriggling their way out of responsibilities and leaving all of the onus on Government to help these companies that have paid into insurance policies for many, many years?

Can I thank Dawn Bowden for raising a concern that a number of politicians have also flagged up with me? You're absolutely right, Dawn, that, in some respects, some insurers are trying to find any way possible to avoid paying out on claims. That's not acceptable, and you're right that Ministers are speaking with the ABI—the Association of British Insurers—this afternoon. That discussion began about 30 minutes ago. I was meant to be part of it, and I've asked my colleague, Jeremy Miles, to chair it. We will report back to Members on the outcome of that discussion. But if there are any cases that need to be highlighted to Government, there is a specific business COVID-19 e-mail that I'd urge Members to pass on to businesses. It is, quite simply: business.covid-19@gov.wales.

And you're right that businesses, particularly in the events sector, are finding that their insurance policies were not detailed enough, that they didn't get sufficient cover to ensure that they could apply for a successful claim in the event of a pandemic of this type. The problem that I personally have with insurance businesses in this regard is that, sometimes, the small print is too small to be read, and some glaring holes that should be flagged up with customers as they are purchasing their insurance policies are not highlighted to them. I think there is a role in the insurance industry to offer more transparent means of sharing vital information with their customers.

Thank you very much, Minister. And my apologies to those of you who'd indicated that you would want to have asked questions, but I have extended the time significantly on this statement.