4. Statement by the Minister for Economy, Transport and North Wales: Response to Coronavirus (COVID-19)

– in the Senedd at 1:20 pm on 10 June 2020.

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Photo of Ann Jones Ann Jones Labour 1:20, 10 June 2020

Well, good afternoon, everybody. Welcome back after that break. We move into our Plenary agenda with item 4, which is a statement by the Minister for Economy, Transport and North Wales: response to coronavirus, COVID-19. I call on the Minister for Economy, Transport and North Wales, Ken Skates.

Photo of Ken Skates Ken Skates Labour 1:21, 10 June 2020

Diolch, Dirprwy Lywydd. I'd like to begin by thanking Members across this Chamber, as well as my officials, social partners and our colleagues in local government, as well as, of course, our public services in Wales for the huge amount of work that they do each and every day supporting our national response to the COVID-19 pandemic. And I'm proud of what we've done so far to help mitigate the economic impact of this awful disease, and I am hugely appreciative of the hard work that everybody has put in.

I should say, Dirprwy Lywydd, that in terms of our response to coronavirus, we have now had a huge amount of businesses generate financial support from the Welsh Government in ensuring that they can survive the short-term period that we face, and that we are looking at the longer term recovery from coronavirus in a way that builds back a fairer, greener, more resilient economy.

Since publishing our road map for the recovery on 15 May, the Welsh Government has been planning the next stages of its work to ease the lockdown. We have always been clear that that work must be grounded on the science that is available to us, and with worker safety at the forefront of every single decision that we take. I've been meeting with partners through the shadow social partnership council regularly and I'll continue to do so in order to discuss the shared measures that we can take to gradually reopen our economy in a safe, sustainable and fair way, whilst continuing to support public health and our NHS. To help us achieve this we've used the dialogue with social partners to develop and to publish detailed guidance, setting out what employers and employees need to do to operate safely and, of course, lawfully.

The guidance that we have set out on the Welsh Government website is for all workplaces and does not replace legislation or industry-specific guidance. Dirprwy Lywydd, nor should it be considered as a substitute for legal advice, which employers and employees should consider obtaining where necessary. Each workplace is unique, and every one needs to do what is right for their own specific workers and customers. The Welsh Government has published in-depth guidance to support a safe return of the manufacturing sector, and further guidance for other key sectors will be published over the coming weeks. And we're consulting with Welsh businesses and with trade unions to ensure that our approach is proportionate and also fair to businesses and to workers. We want workplaces and workers in Wales to be safe, so we'll be asking all employers and employees to show care by acting with compassion and understanding; to comply with laws designed to keep us all safe; to involve everyone because safety is a shared endeavour; to adapt workplaces and behaviours; and to communicate with clarity and consistency.

As we begin the work of the economic recovery, I've been clear that the UK Government should not withdraw the important suite of support that they've put in place over the last few months. That's why we strongly welcomed the announcement on 12 May, by the Chancellor of the Exchequer, to extend the job support scheme on the current basis until the end of July, and on an amended basis until the end of October. The job retention scheme has been essential to enable large parts of the economy to hibernate through the last few weeks of lockdown.

In moving forward, we will continue to make the following arguments to the UK Government: first, that there should be no reduction in support in respect of businesses that cannot legally open; that reducing the volume of an employer’s workforce that can be furloughed would be preferable to a general tapering of the intensity of support; that any action must not push employers to jeopardise safe working because of financial pressures; and that the UK Government should make available grant support for businesses to make physical adaptations to ensure safer working.

In Wales, we have put in place the most generous package of help for businesses anywhere in the UK—a total of £1.7 billion of support. Yesterday, I was delighted to launch the new eligibility checker for the next phase of the economic resilience fund. The fund aims to plug the gaps in the support schemes announced by the UK Government, including the job retention scheme and the self-employed income support scheme.

Phase one of the ERF covered any sustainable business operating in Wales, of any age or type, that is VAT registered, that employs people via pay-as-you-earn and that has suffered a significant turnover impact. Phase two of the fund will operate in broadly the same way as phase one, but with an update to the eligibility of the micro scheme to enable limited companies that are not VAT registered to access the fund. The full applications phase is expected to open on or before 29 June. The second phase of the ERF will enable access to the remaining £100 million of the £300 million already approved and allocated to support micro businesses, SMEs and large businesses. Work is under way with stakeholders to develop further support options for those not yet reached—for example, start-up businesses—and I will make further announcements on that in the coming weeks.

Dirprwy Lywydd, I have said before that, in planning for the recovery, I want us to build back better: to use coronavirus as a moment for fundamental change in our economy, so that what comes after is fairer, more inclusive and more sustainable than what went before. And that's why I was extremely pleased this week to attend the socioeconomic sub-group of the BAME expert advisory panel. The sub-group, chaired by Professor Emmanuel Ogbonna, is helping the Welsh Government to identify the range of factors influencing adverse COVID-19 outcomes in BAME groups, and to look at wider inequalities in our economic life in Wales. I have been deeply impressed by the work of the sub-group and am under no illusion that, in Wales, we still have—despite a huge amount of good progress—structural and embedded inequalities in our economy that contribute to the unfairness and discrimination that still impacts black, Asian and minority ethnic groups. So, when we talk about building back better, it is to the work of the sub-group that I think we should turn for guidance and evidence in our quest for something fairer, and I want to put on record today the support of myself and my department to doing that work over the coming months and years. Dirprwy Lywydd, I'm happy to take questions.

Photo of Helen Mary Jones Helen Mary Jones Plaid Cymru

Diolch, Dirprwy Lywydd. I'd like to thank the Minister very much for his statement, and just to say how much I welcome his emphasis on safety when it comes to opening up the economy. I hope that, across the Chamber, we would all agree with that.

Of course, the reopening of the criteria for the economic resilience fund is welcome, and I'm particularly pleased to say that for businesses not registered for VAT it will now be available. But, as the Minister has said himself, there are a large number of businesses still that are not being able to be helped, particularly businesses operating from home, and I've had everything from hauliers to hairdressers to bed and breakfasts—companies that are viable businesses, but are not paying business rates. The Minister mentions in his statement some further support for them. I wonder if the Minister can tell us today when he thinks he will be likely to be able to make that additional support, for example, for start-up businesses—when he's likely to be able to announce what that will look like.

Photo of Ken Skates Ken Skates Labour 1:29, 10 June 2020

Can I thank Helen Mary Jones for her questions? I agree entirely that safety is absolutely vital in the workplace, not least because it's only through operating safely that people have the confidence to leave their own homes and to either return to work or access places of employment, businesses and attractions.

In terms of the very specific question concerning the remaining businesses that may require additional support, and in particular those start-ups, it is my hope that we'll be able to operate all support schemes concurrently from 29 June in terms of applications and then that we'll able to get financial support out as soon as possible, in all probability within a matter of days to businesses that apply at the earliest opportunity.

Photo of Helen Mary Jones Helen Mary Jones Plaid Cymru 1:30, 10 June 2020

I'm grateful to the Minister for his answer to my questions. Thinking of safe return to work and the Minister talking about need for such a return to be done with compassion and understanding from businesses, can the Minister confirm this afternoon that those who are shielding at home, not because they are vulnerable themselves but because their family members are vulnerable, can he confirm that he does not expect businesses in Wales to be pressurising those people to return to work until the shielding rules change?

I'd associate myself with what he said about the need for the UK Government to make continued investment in the Welsh economy. The Minister will be aware of the report that showed that, out of the 20 towns likely to be worst hit in England and Wales, 10 of those were in Wales, and, of course, that's greatly out of proportion with our population. Will the Minister consider making representations to the UK Government that any further business support should be on a base of the scale of need in Wales for that support, rather than on what has become the traditional Barnett formula?

And will he continue to make representations to the UK Government particularly around the furlough scheme for those who have been left behind? Many of the people who were changing jobs at the time when the furlough scheme begun have now been 10 weeks without any income, and, for some of them, they're not eligible for other kinds of support. So, can I ask the Minister today to make representations again to the UK Government on their behalf and to consider further whether there is anything more that could be done for them by the Welsh Government, fully understanding of course the limits on his budget?

Photo of Ken Skates Ken Skates Labour 1:32, 10 June 2020

Absolutely, I'll guarantee today that I'll make those representations, and in regard to what support we may be able to offer, if we were able to introduce a hardship bursary for any individuals that simply cannot benefit from existing support systems, then we will do so in partnership with our local government colleagues. 

A significant number of businesses are still able to apply for support through the job retention scheme, the self-employment support scheme, without actually being aware that they are able to. So, I would urge all businesses to check with Business Wales whether they are eligible for Welsh Government or for UK Government support, because the vast majority right now are able to access financial support. 

And Helen Mary Jones is absolutely right that employers need to act with compassion and understanding. Clearly, people who are shielded should not be expected to return to work if they are asked to do so, and they should have a letter available to them that would be able to be presented to an employer. For those individuals who are not shielded but are supporting shielded individuals, I would say that a responsible business must take account of that and must show complete understanding. And I would hope that businesses that are unionised would be particularly determined to ensure that all workers return in a safe way and in a way that doesn't put at risk anybody's lives or well-being. 

And you're absolutely right, Helen Mary Jones, in saying that, based on the evidence that is emerging, Welsh communities stand to be adversely impacted above and beyond those across England because of the high reliance on sectors that are going to be particularly hard hit and for longer, and because of the age profile of the workforce in Wales, and because of historic reasons—reasons relating to de-industrialisation, for example. 

As a consequence of this, we are absolutely clear that initiatives such as the UK industrial strategy must be shaped for Wales as well as for English regions, and the contact that I've had with the Department for Business, Energy and Industrial Strategy has been very, very productive, and I do hope that the next iteration of the UK industrial strategy will significantly benefit the Welsh economy, because, as the Member has already stated, we can't have Barnettised support that doesn't recognise the scale of the need of the Welsh economy. Instead, we have to have support that reflects on the additional requirements of Welsh businesses and also of Welsh workers.

Photo of Russell George Russell George Conservative 1:35, 10 June 2020

Can I thank the Minister for his statement? I think much of it I also heard at the Welsh Government's 12:30 briefing today, which you led.

Minister, retail businesses in England will be reopening on Monday, and Welsh businesses, specifically those on the border, such as in your constituency and mine, will be disadvantaged. I wonder what you can say to these businesses in terms of giving them some hope that they'll be able to open at the earliest opportunity possible, and how would you address their concerns about being disadvantaged with perhaps a competitor opening just a few miles away from them?

I'm not only concerned about businesses across the border, but there are some retail businesses in Wales that are opening against Welsh Government guidance, and as much as I would like them to open, and believe they should, it's the law that they should not. I gave you one example yesterday, when we met privately. I wonder what you would say in terms of enforcement action against these kinds of businesses, and ensuring that local authorities are given the correct advice to these kinds of businesses, because it's absolutely unfair for retail businesses that are abiding by the law.

With regard to the next phase of the economic resilience fund, I'm very pleased that you've brought forward the date for the criteria. I'm very pleased that you widened the criteria, as you have. But I wonder if you could commit, Minister, to bringing forward the date from which businesses will begin receiving payments under phase 2 of the fund. I think it would be extremely disappointing and frustrating if businesses could not apply for assistance until the end of the month. I think, in many cases, and sadly, in some cases, that will just be too late. And there's also some massive concern, of course, as Helen Mary pointed out as well, that there are still some businesses that will not be eligible for support at all—B&Bs are one example—and I wonder if you could tell us more about the bursary. What can we tell our constituents when a business contacts us and we've told them to wait for phase 2, they've put all their hopes on that, they've checked the criteria and they still are not eligible for support, and they've had no Government support at all for businesses?

Photo of Ann Jones Ann Jones Labour 1:37, 10 June 2020

All right. Thank you. Minister.

Photo of Ken Skates Ken Skates Labour

Thank you, Russell. First of all, I'd say with regard to businesses in borderland areas, we've got the benefit in Wales of having the regular review points, and so the dates are known to businesses. At the last review point, the First Minister said that, over the next three weeks, non-essential retail could begin a process of looking at how they may be able to reopen after the subsequent review point, if infection levels are sufficiently low. That next review point is coming on 18 June—just next week—so there's only a tiny time lag of a matter of days between what's happening in England and what's happening in Wales. But, obviously, it would've been desirable if we could've had those regular review points adhered to on both sides of the border, and ideally if the review points could have been at exactly the same time. That's not happened, but here in Wales we have stuck to what the First Minister has called that regular rhythm of three-week review points, giving some certainty and clarity to the business community of Wales.

Our confidence is absolutely key to the competitiveness of businesses. Still, around 60 per cent of people in Wales are too nervous to leave their own homes. So, quite frankly, if a business opens but two thirds of people are too scared to leave their own homes, they are going to struggle to make ends meet, they are going to struggle to be viable. So, as well as opening businesses, we have to ensure that people have confidence in order to access them. To do that, we've got to see the R number fall sufficiently for people to regain confidence, and we have to make sure that workplaces are safe for people to access. That's why the guidance that we're publishing on that is so very, very important.

If we can bring forward the application date, we clearly will do. We need to close off any existing applications for ERF round 1 funds to ensure that there is no duplication of applications and that we have completed all of the processing that needs to take place. There are a large number of businesses that we are now finding who are saying that they're ineligible for various support schemes, but we are subsequently finding actually are eligible, and this is why it's so important that businesses visit the Business Wales website, that they run through the eligibility checker and that they submit accurate details as well, because businesses such as—. The examples of B&Bs and market traders have been used. They should be eligible for the self-employment income support scheme, or, if they employ, they should be eligible for furlough. When they're not eligible for those, then, obviously, there could be the potential of the ERF being open to them. But if there are any businesses, once we have run through the process of establishing the start-up bursary, as well as ERF phase 2, then we would be able to look at supporting them through, potentially, a discretionary hardship bursary that could be administered by local authorities, and work is taking place with local authorities in that regard.

And then, to the final point regarding fair play across businesses, I would agree with Russell George that all businesses should adhere to the rules that have clearly been set out. Where they do not, then we will seek to take enforcement action against them. We are all in this endeavour together, and we must all abide by the rules and the guidance if we are to maintain social cohesion and if we are to maintain the best possible prospects for businesses to emerge from this virus intact.

Photo of Russell George Russell George Conservative 1:41, 10 June 2020

Turning, if I can, Minister, to transport, what work has been done to tackle the rolling stock shortage during the lockdown so that the practicalities of social distancing demand on public transport with severely reduced capacity can be met? Are there any plans for Transport for Wales to use this time of reduced services to make improvements to their rolling stock, and, if so, what are the targets?

How are you going to change the Welsh Government's economic approach as a result of how the pandemic has changed our economy? I appreciate what you've already said today, and I wonder if you could add timescales, perhaps, to what you've already stated. And second, what initial assessment have you made of how the pandemic has affected the economic performance of different regions of Wales?

The UK Government has expressed its intention to invest and bring forward spade-ready infrastructure projects to ensure that the UK economy can bounce back quickly, and, if you agree with that principle—and I hope you do—what infrastructure projects in Wales are spade ready?

Photo of Ken Skates Ken Skates Labour 1:42, 10 June 2020

Can I thank Russell George for his further questions and say that we are in dialogue with UK Government regarding schemes that could be supported as part of the recovery? One such scheme is the global centre for rail excellence in south Wales. We're in discussions with UK Treasury, the Department for Business, Energy and Industrial Strategy and the Wales Office regarding that scheme. There are other schemes, such as the proposed advanced technology research centre in Deeside, which would complement the advanced manufacturing research centre, and, of course, discussions are taking place, as you'll be, no doubt, aware, regarding the potential for enhancing renewable energy schemes in Wales, building on the expertise that we have in that particular field. So, in terms of the recovery, discussions are ongoing, submissions have been made to UK Government for financial support, and we're hopeful that those submissions will be met with approval.

I think, right across the globe at the moment, there is intense interest in acquiring, wherever possible, additional rolling stock. As you can imagine, every train operating company across Britain, across Europe and further afield is trying to find additional carriages that could be used in order to boost capacity at a time when capacity is reduced because of social distancing to 15 or so per cent. So, we are essentially, through Transport for Wales, in competition with train operating companies not just within the UK, but much further afield.

We are looking at how we can implement enhanced maintenance regimes, take the opportunity not just in terms of rolling stock, but also in terms of road infrastructure, to enhance what we have and what we're in control of. We're also looking at innovation, both on buses and on trains, to be able to increase capacity, if at all possible, whilst adhering to social distancing and also ensuring that public safety is not put at risk, recognising that the operation of the economy is inextricably linked to the safe operation of public transport systems. 

Photo of David Rowlands David Rowlands UKIP 1:45, 10 June 2020

Can I thank the Minister for his statement today? I think there is much in it that we would all in the Chamber agree with, and also, we acknowledge the many interventions that have been going on, put in place by the Welsh Government, and we thank you for those. Despite the considerable financial help that some businesses have been able to access, many of those in my constituency are now expressing deep concern about their ability to continue trading.

Obviously, those at the forefront of the current restrictions are pubs, restaurants and the service trades in general. I have evidence that some pub-based catering chains will not be reopening a number of their outlets post lockdown, with, of course, a subsequent loss of jobs—jobs that are often at the lower end of the skills market. So, notwithstanding your desire to keep people safe from infection, and we all agree with that, can the Minister urge the Government to ease restrictions on these trades as soon as possible? Because I believe irreparable damage is now being inflicted on the Welsh economy—damage that may never be reversed.

Photo of Ken Skates Ken Skates Labour 1:46, 10 June 2020

Can I thank David Rowlands for his question? I repeat the point that I have made to previous speakers—that, in order to ensure that your business is operational, you have to be able to generate an income, and if people are not confident to access services, then they simply won't do so. So, in order to make sure that pubs and cafes and restaurants, when they decide to reopen their doors, can survive and make a profit, we have to ensure that people have confidence to access them. We have to make sure that they are operating in a safe way. We gave non-essential retailers notice at our previous review point that they should prepare for a safe reopening over the next three weeks, and the First Minister will be making a statement at the next review point regarding that work that is taking place, and the progress that's being made in terms of controlling the virus. There will then subsequently be review points at 9 July and also at 30 July. At those review points, we may be able to say more about other parts of the economy that can reopen safely, but ultimately, we have to ensure that the public are with us, because if you have people refusing to leave their homes, we are simply not going to be able to support the reopening of those important businesses in the hospitality sector and many other sectors as well.

Photo of Jenny Rathbone Jenny Rathbone Labour 1:48, 10 June 2020

I'm very pleased to receive your statement, particularly the point you're making that the work we do in the future must be grounded on the science, and also, that people's safety must be at the forefront of every decision we take. You'll be aware of the initial findings and research flagging up the possible link between air pollution and increased levels of COVID-19 transmission, for example in the Bergamo area of northern Italy. I'm very pleased that you've been engaged with the socioeconomic sub-group of the BAME expert advisory panel, chaired by Professor Ogbonna, so we can really understand the causes of why BAME people have been so disproportionately affected by COVID-19.

In the context of the safety of my constituents, I know that Cardiff Council is planning measures to prevent commuters or shoppers overwhelming our city centre, so that we don't have the pre-COVID traffic congestion that delivered dangerous levels of air pollution.

Beyond these immediate measures, then, I'm keen to understand the extent of your ambition to build back a better, cleaner, carbon-neutral Wales. How can we use the unique selling points that Wales has—both our geography, which makes us a major generator of renewable energy, and as a pioneer of hydrogen from renewables, which could enable us to become a European leader in cleaner transport and becoming a more carbon-neutral Europe. So I wonder if you have given consideration to this.

Photo of Ken Skates Ken Skates Labour 1:50, 10 June 2020

Absolutely, and Jenny, I couldn't agree more. We've got the hydrogen arc in the north, with a huge degree of collaboration taking place between businesses and research institutions in north Wales and across the border in the Mersey Dee area. Then, of course, we've got some exemplary businesses in mid Wales regarding the potential use of hydrogen in road vehicles, with Riversimple perhaps leading the way in this regard. So, there is enormous opportunity in terms of exploiting research and development concerning hydrogen propulsion and hydrogen as a form of energy for other uses as well, particularly in business, for example. 

In terms of the more general question about how we make sure that we build that better, well, it will require us to invest in more decarbonisation schemes, in fair work businesses—businesses that abide by and embrace fair work principles. It will require us to invest and focus our investment on businesses that prioritise skills enhancement of their workers and on the well-being and mental health of their workers. It will also require a stronger focus on supporting business growth, not just individual businesses' growth, but also growth within the supply chain that that business may be a part of or that that business supports.

So we're developing a range of principles that can be applied to our investment decisions in the coming months and years. But, crucially, we have to make sure that we take this opportunity to narrow inequalities in Wales, and that will require a concerted effort with regard to our employability interventions—interventions like Jobs Growth Wales, the apprenticeship programme, and schemes that will be able to be moulded and tailored to individual needs so that we give people from BAME communities and people who face disabling factors in society a far better chance of meeting their aspirations and goals than they had before coronavirus. That will be a key test for us. 

Photo of Suzy Davies Suzy Davies Conservative

Diolch, Dirprwy Lywydd. Thank you for your statement, Minister. First of all, can I just clear something up here, and this is the extension of support to non-VAT-registered operators? Does that just apply to limited companies, or does it apply to firms and sole traders as well? We've been speaking about tourism quite a lot today, and a few people have mentioned B&Bs and, of course, those very small B&Bs aren't likely to be VAT registered and also they're outside the business rates system as well, because they're too small to be allowed to be registered. So perhaps you could clear that up. 

Secondly, as I think David Rowlands mentioned, we have still got businesses that are outside the ERF at the moment. I've had representations made by people who have actually been very successful, but can't actually access anything without giving personal guarantees, which they're reluctant to do because they're not sure about the viability of their business if they are in a sector that is going to be the last to open. So, I wonder if you could give us a little bit more detail on what you're looking at in that respect. 

Photo of Ken Skates Ken Skates Labour 1:53, 10 June 2020

Okay, thank you, Suzy, for your questions. First of all, yes, a business would have to be limited if they are not VAT registered in order to attract support from the second phase of the ERF. However, sole traders and partnerships are eligible and were eligible in the first round of the ERF, providing that they could meet the criteria of a drop in turnover, that they're VAT registered and that they employ via PAYE. I think there has been some confusion about some groups, particularly market traders, who have felt that they are not eligible for any support whereas, actually, market traders are eligible for support through the self-employment support scheme, unless they don't have accounts or unless they are paid above the threshold of £50,000. So, market traders generally, unless they are incredibly successful, affluent market traders, would be able to access support through the UK Government's self-employment support scheme. 

We believe that the vast majority—the vast majority—of businesses will be captured through the second phase of the economic resilience fund. But, of course, as I've said to others, we are working with local authorities on the potential development of a hardship bursary, recognising that there may be unique circumstances that have prevented businesses and individuals from seeking and attracting and securing Government support, whether it be from UK Government, or from Wales.

In terms of ERF support, we're not asking for personal guarantees; of course, we wish to assure ourselves that businesses are viable, and that's absolutely right. In terms of the support that's been offered through the Development Bank of Wales, personal guarantees have been important to make sure that there is, if you like, for want of a better phrase, skin in the game; there is a full commitment to business development and business growth. I think, given that the Development Bank of Wales's first COVID loan scheme was so, so successful, I don't think that the criteria would need to be amended if the development bank returned with proposals for a similar second round of support.  

Photo of Huw Irranca-Davies Huw Irranca-Davies Labour 1:55, 10 June 2020

Minister, there's a real worry that, out of necessity, many people, as we see the restrictions on coronavirus being eased to allow people to go back to work and to some elements of social movement as well, then it's going to be in private cars with individuals driving, no passengers, and that we risk, then, a rush back to a type of society and type of work that we really don't want to see. What we have seen more recently is that the curious externalities of this crisis have been clearer streets and roads, cleaner air, less air pollution and more liveable communities as well, with better quality of life for those people who are walking or cycling.

So, can I ask you, Minister, what work is being done by Welsh Government right now, but also as we transition out of coronavirus, to explore things with employers such as more flexible working, either working from home or staggered work times and staggered shifts, or hybrid models for employers, where employees can, to mix and match how they work from home and actually go into work? What are we looking at in terms of redoubling our efforts and our investment, not only in active travel as we've known with walking and cycling, but actually building more dedicated bus lanes so that as we emerge, we can use those more, and dedicated cycle routes as well? 

Photo of Ann Jones Ann Jones Labour 1:57, 10 June 2020

Okay, thank you. Ken Skates to answer, please. 

Photo of Ken Skates Ken Skates Labour

Can I thank Huw Irranca-Davies for his questions? He's absolutely right that we need to lock in some of the benefits that have been accrued through people choosing not to use their car, through people instead undertaking active travel. I can inform the Member that we'll be investing millions upon millions of pounds in road reprioritisation schemes, first and foremost for temporary schemes that can test the ability of local authorities to be able to deliver longer term improvements, but also to make sure that those short-term behavioural improvements that we've seen become the long-term norm.

We're also looking, and we've begun the work, at a smarter working programme that will, essentially, encourage the private sector, the third sector and the public sector to adapt working shift patterns to ensure that people can work remotely, and to ensure that people can work in a way that aligns their working day with the provision of public transport so that they don't have to use their own car. And we're also looking at how this particular smarter working programme can dovetail with the work that colleagues in local government and housing are doing on the town centre first approach. 

So, what we're keen to do is to utilise redundant buildings within town centres and high streets as shared spaces, remote working places, not just for the public sector, but also for the private sector and the third sector. It drives innovation, it enhances creativity, it's good for the economy, it's good for the environment, it's good for communities. 

Photo of Ann Jones Ann Jones Labour 1:59, 10 June 2020

Thank you. Mark Isherwood. You need to unmute. You need to move your mike, Mark. 

Photo of Mark Isherwood Mark Isherwood Conservative

Right. Small bed and breakfasts, already referred to, are a mainstay of many local economies across north Wales—real small businesses providing essential income for their owners. They're eligible for a business grant in England. After I questioned you three weeks ago about Welsh Government support for them, they told me they found your comments condescending and insulting. I then wrote to you, stating that they and the local economies they help to support are looking to you for help before it's too late. In your reply, you stated that the eligibility checker for the second phase of economic resilience fund for new applications will open mid-June. They responded, 'I understand there may be a glimmer of hope with the new economic resilience fund. So, fingers crossed, we may all have a new option then.' What have you therefore got to say to them now that they've told me, quote, 'According to the checker, our business is still not eligible'?

Photo of Ken Skates Ken Skates Labour 2:00, 10 June 2020

Can I thank Mark Isherwood for that question? I would, first of all, have to understand why they were not eligible for support through the ERF phase 2, but I will also say that we do have the most generous and comprehensive package of support for businesses anywhere in the United Kingdom. If they are not eligible for support through the ERF grant, I would be very keen to know whether they've been able to secure support to date through the job retention scheme, through the self-employment support scheme, or any other scheme. And if that is not the case, if they are truly are not able to attract support, and if they have seen a huge decrease in their turnover as a result of coronavirus, and if they do depend on those business operations for their livelihood, and if they meet all of that criteria, then, of course—of course—they are a business that we wish to support, and that is why we are carrying out work with our local authority colleagues on the potential introduction of a hardship bursary that will run alongside the ERF phase 2. 

But, first and foremost, I would need to understand the circumstances that those businesses are in, because, as I've said, there is, in some parts, a misunderstanding about what is actually available at a UK-Government level, and some businesses—only some, but some businesses—have been waiting to check whether they are eligible for more support from the Welsh Government schemes before applying for support from those UK Government schemes. It's absolutely vital, given the finite pot of money that we have, that if a business is able to get support through the job retention scheme, or through the self-employment support scheme, they go to those schemes first, because our finite resource, the economic resilience fund, is designed to plug the gaps. Now, if the businesses that you're referring to, Mark, are truly falling through the gaps, we want to help them.

Photo of Rhianon Passmore Rhianon Passmore Labour 2:02, 10 June 2020

Will the Minister outline progress around aviation support from the UK Government? As he's aware, British Airways is proposing pan-Wales job losses, and amalgamating Blackwood jobs, potentially, in my constituency to the city of Cardiff, which would result in the closure of their site in Blackwood and the loss of high-skilled and high-value, well-paid jobs to the Valleys. What is his understanding of the use of job retention furlough payments of public money when BA indicates it is going to not retain these staff but make them redundant, while, obviously, a clear market leader, holding large reserves, which has just purchased a Spanish air subsidiary? Will he then outline how the Welsh Government can further assist and support this valued workforce when dealing with this employer who is totally unable to consult its workforce as is required during this period? And would he agree with me that British Airways must now pause and rescind their section 188 notice whilst aviation sectoral support is being determined?

Photo of Ken Skates Ken Skates Labour 2:03, 10 June 2020

Well, can I thank Rhianon Passmore, and say that I think, in general, Members across the Chamber and Members in the UK Parliament are speaking with one voice with regard to the announcement from BA? And I think Kelly Tolhurst's critique in the House of Commons was appropriate and correct, and I think it's absolutely right that British Airways are held to account for the decisions that are being made, that they don't seek to exploit the job retention scheme in the way that it appears they may have done so, and that the loss of jobs, if there is indeed to be a loss of jobs, is kept to an absolute minimum.

Now, if we look at what support is being offered to the UK aviation sector, compared to what's happening elsewhere around the globe, I'm afraid it should leave us with serious concerns about the future viability of the sector. Just yesterday we saw the announcement of a huge—huge—support package for aerospace in France. It amounts to £12 billion in grants. Cathay Pacific received a £4 billion bail-out from the Hong Kong Government, and by contrast, to date, we have not seen vitally important support thrown the way of UK aviation businesses. Time is running out for many regional airports, for many airlines, and for huge numbers of people who are employed in this vitally important sector. So, I would encourage the UK Government to come forward with an ambitious strategy for aviation, and one that is backed up with investment.

Photo of Jack Sargeant Jack Sargeant Labour 2:05, 10 June 2020

Minister, I'd just like to pick up on your last comments, really, on the support for the aviation sector in Wales. As you rightly mentioned, the French Government have provided a huge support package for this industry, which has not been forthcoming from the UK Government. Would you join me in urging the UK Government to get round the table—because it is about time they get round the table—with your ministerial colleagues, with the trade unions, and with industry leaders, to create a package of support and implement those measures to our very important industry?

Photo of Ken Skates Ken Skates Labour 2:06, 10 June 2020

Well, I'd agree entirely with that statement, Jack Sargeant. And I'm sure that many other politicians across the United Kingdom, in other devolved administrations, would agree as well. I've spoken with counterparts in Northern Ireland, for example, who are very anxious about the state of the aviation sector there. And there are concerns in Scotland as well, in many parts, many regions, of England, and particularly in those areas of the UK that are really fragile right now, in terms of the economic status of their respective places. And it's vitally important, therefore, that the UK Government shows strong leadership, that it uses the fire-power that it and it alone has to support the sector, and that it does so without delay. And there are some specific schemes in Wales that could be supported that would enhance the prospects of the aviation sector. I could point again back to the advanced technology research centre that is proposed for Deeside, the work that the UK Government could do in supporting the advanced manufacturing research centre around Airbus's determination in Broughton to capture the wing of tomorrow. These projects are going to be hugely important if the aviation and aerospace sectors of the UK are going to survive this turbulent period.

Photo of Janet Finch-Saunders Janet Finch-Saunders Conservative 2:07, 10 June 2020

Minister, you'll be aware that tourism usually generates more than £3.2 billion in revenue every year, with 40,000 Welsh hospitality jobs across Wales. The economic benefits to Conwy is £900 million. The sector is in a perilous state. We have already lost a number of hotels in Aberconwy, and many others have warned that not opening in August would be nothing short of disastrous. What are your intentions for reopening our hospitality accommodation that is not self-contained? Will you provide a timeline so that they can prepare in advance? Will you work with stakeholders in the sector, such as the British Holiday and Home Parks Association, to agree a plan for how social distancing can be implemented in the reopening of our vital tourist accommodation? Will you allow the opening of restaurants, pubs and bars on 4 July, as is being considered in England? And finally, will you please open the Welsh Mountain Zoo? Social distancing can take place there, as it's outdoor activity? It's a must-do; please do it, Minister.

Photo of Ken Skates Ken Skates Labour 2:08, 10 June 2020

Can I thank Janet Finch-Saunders for her questions, and first of all assure her that huge support has been offered to the Welsh Mountain Zoo? And the Welsh Mountain Zoo, unlike zoos in England, has not been required to stay closed; it's legislation that was introduced in England in the last week to keep zoos closed that's prevented zoos from reopening. Here in Wales, that legislation does not apply. The reason that zoos in Wales are not able to open at the moment is because they would simply not be able to generate the footfall and therefore be able to generate the income to make it financially viable to open right now. Why? Well, because, as I've already stated, more than 60 per cent of people in Wales—and that's a figure that's reflected in many, many parts of the UK—are too nervous to leave their own homes, never mind to access businesses, to go to visitor attractions. But the fact of the matter is that businesses that rely on visitors—those visitor attractions—will require people to have the confidence to access them. People won't have the confidence unless the R number is brought down sufficiently for them to feel confident, unless we really are making sure that the virus is fully under control.

Now, in the meantime, the sort of support that's being offered to zoos in Wales, I think, has been extraordinary, bearing in mind that we did not get a single penny of consequentials, based on the UK Government's zoos fund announcement. Now, we have opened up the economic resilience fund to zoos in Wales. There are 30 registered and licensed zoos in Wales. We've written to each and every one of them to ensure that we fully understand the implications of coronavirus and so that we understand where we might be able to assist. And as a result of the economic resilience fund, we've been able to make eight offers of support to zoos in Wales. The Welsh Mountain Zoo is one of those to have benefited from the economic resilience fund. It's also benefited from the Development Bank of Wales's COVID-related loan scheme—two schemes that are exclusive to Wales, and that support amounts to £335,000. Contrast that—had we got a Barnettised consequential of the UK Government's zoos fund, it would have amounted to just £700,000, which would have been nearly double what has been spent on just one single zoo in Wales. That demonstrates why we can say confidently that zoos in Wales have been better protected through this pandemic than elsewhere.

I am determined to make sure that we do all we can to support the safe reopening of zoos when they choose to reopen, but—I have to stress again—what is going to be crucially important is that the general public have the confidence to leave their homes and to go and visit such attractions. Because if people don't have confidence, they won't go to them—they won't hand over money for tickets, income won't be generated, and what will happen then? We only get one shot at reopening businesses and at reopening attractions.

It will be impossibly difficult for the Welsh Mountain Zoo, or any other zoo for that matter, to be able to put their workforce back into furlough without the UK Government giving any indication that that would be possible. It will be impossibly difficult as well, once a zoo is open and then chooses to close, to provide sufficient confidence in the term afterwards to guarantee that they will be able to reopen and then stay open. So, we've offered the certainty of the review points, and the next review point is on 9 July and then 30 July. And we've said to people, with the certainty of those review points, 'You'll be able to plan for reopening, where we believe that it can be carried out safely, and that those physical adaptations that are required for a business to reopen, or an attraction to reopen, can be implemented in a timely fashion.'

Photo of John Griffiths John Griffiths Labour 2:12, 10 June 2020

Minister, we've seen major investment in the electric car industry across the world, and as we look for economic opportunities coming out of COVID-19, I would suggest that the UK really should develop a first-class manufacturing capacity for electric cars and everything that needs to go around that. And in Newport, of course, we have the Orb works, which could manufacture the electrical steels required for such an industry. Would you continue to talk with UK Government, the trade unions and business, Minister, to emphasise this huge opportunity and make sure that the UK, Wales and the Orb works in Newport do not miss out?

Photo of Ken Skates Ken Skates Labour 2:13, 10 June 2020

Well, thank you, John Griffiths, and I agree that the future will see the uptake of ultra low emission vehicles intensified and accelerated, but I would also hope, as we emerge from coronavirus, we see the use of public transport increase as well, and that we see active travel increase significantly. So, we're keen to ensure that investment is made in the infrastructure that can support active travel, in the infrastructure and the services that support public transportation, and that we and the UK Government, through the UK industrial strategy, are able to invest strategically to support the development of the very best ultra low emission vehicles and also that we use our emerging technologies, such as those that concern hydrogen. And, John, you've made a very powerful case on numerous occasions for the Orb works to be considered as part of this exciting programme of works, and I can guarantee that we will continue to press upon the UK Government the presence of that facility and the potential of that facility in this important agenda.

Photo of Ann Jones Ann Jones Labour 2:15, 10 June 2020

Thank you. Mandy Jones. Can somebody open Mandy's mike, please? 

Photo of Ann Jones Ann Jones Labour

Fine, carry on. 

Photo of Mandy Jones Mandy Jones UKIP

Thank you, Deputy Llywydd. Thanks for your update, Minister. As we all know, Wales relies on tourism, and nowhere more so than the region I represent and the one for which you have ministerial responsibility. Tourism's big business. We do it well in Wales. People love coming here for holidays. They spend their money improving our economy. But I'm being told by the caravan park sector in particular that business is draining away to England and a bad situation is being made worse as site fees are reliant on parks being accessible. So, people want refunds and, if standards are to remain high, maintenance costs will still be there. Businesses are losing faith. 

My questions are: what representations have you made to your Cabinet colleagues with regard to the gradual reopening of caravan parks in particular, which are mostly distanced apart? If Wales continues with restrictions that differ to the rest of the UK, what further support will you offer these businesses to ensure that the Welsh tourism industry is open to all? Graham Evans, from Parkdean Resorts, has asked if you are prepared to have a Zoom meeting with him. Would you be okay with that? And, finally, if the point of lockdown was to flatten the curve, I congratulate your Government on your success. So, will you—? Do you know when Wales will be open for business? Thank you. 

Photo of Ken Skates Ken Skates Labour 2:16, 10 June 2020

Well, can I thank Mandy Jones not just for her questions, but also for her helpful comments and a request for a Zoom meeting with a constituent? I'll clearly engage with my colleague the Deputy Minister for Culture, Sport and Tourism over who may be the most appropriate to have that meeting, but we are keen to engage with as many businesses in the tourism and hospitality sector as we possibly can, as we go about planning the recovery period and the safe reopening of businesses.

As I've said to others, there are regular review periods that we have and, at the last review period, the First Minister indicated that non-essential retail should take advantage of three weeks of planning for reopening. The next review period will be next Thursday, and then, following that, there will be a review period that will last until 9 July.

Elsewhere in the UK, we've yet to have a date for when tourism and hospitality may resume. Scotland and Northern Ireland—currently they're looking at 20 July, and in England it may be, at the earliest—and the Secretary of State for Business, Energy and Industrial Strategy yesterday I felt was at pains to stress 'at the earliest'—4 July, and there was also the very strong caveat that it's dependent on infection rates being sufficiently low.

What I don't want to do—what none of my colleagues want to do—is to raise false hope, to say that, 'On this specific date you can prepare to reopen'. Instead, when we make announcements, we want to be able to deliver on them. We want businesses to have the surety of knowing that they're going to be able to reopen. I think the last thing that businesses in any sector want is to be told that they should plan for a certain date and then, just before that date, be told, 'Actually, we're going to u-turn on it and we're not going to allow you to reopen'. Because, once you've started the process of pulling your workers out of furlough, it's incredibly difficult to reverse that. You can't put your workforce back into furlough. Those fixed costs that come with reopening, they have to be paid for by that business, and so we have to have the certainty that we can carry through announcements. And that's why we have the three-week review periods, that's why we have review points every three weeks, and I can say, again, that the next review points are coming up on 18 June and 9 July.

We, across Government, are having extensive talks regarding caravan parks and other parts of the tourism and hospitality sector with regard to how they could reopen safely. And the latest of those discussions took place just two days ago. It involved the Deputy Minister for Culture, Sport and Tourism, it involved Eluned Morgan, the Minister for International Relations and the Welsh Language, it involved myself, and it also involved the First Minister. I think that demonstrates how seriously we’re taking this matter, how keen we are to make sure that businesses can reopen as soon as possible, but we want to ensure that we can stick to any date that we announce, because we've seen too many examples elsewhere where dates have been announced, but they haven't actually been delivered.

Photo of David Rees David Rees Labour 2:20, 10 June 2020

Minister, the Welsh Government has funded many businesses—I think, in your press release earlier today, you indicated that over 8,000 businesses have benefitted from the economic resilience fund. Now, that fund is about £400 million and for small and medium-sized enterprises, and I'm sure you and I appreciate that some of our anchor businesses, such as the air industries, mainly in the north, and the steel industries, mainly in the south, would eat that money up in one go, and therefore one business would get that. Therefore, the funding and the levers are not necessarily with the Welsh Government but with the UK Government. And we've heard an awful lot about Project Birch and how it's supposed to be helping these types of industries. To date, we've seen nothing happen and we know that the industries are going to be facing crucial times ahead of us as other European countries are helping their steel sectors, and China is also coming out of this. Are you knocking on the doors of Westminster and even 10 Downing Street to demand that the UK Government now enacts Project Birch and supports these large businesses, because they are the mainstays of much of our economies, both in the north and south of Wales?

Photo of Ken Skates Ken Skates Labour 2:21, 10 June 2020

Well, can I thank David Rees for his question? He's absolutely right that only the UK Government has the financial resource to be able to support the sectors with the sort of intervention that's required, particularly aerospace and steel. They are two sectors that are now standing items on the quadrilateral calls that take place between myself and the economy Ministers in the devolved administrations and with BEIS.

Project Birch, of course, should be utilised to support sectors and businesses across the UK, but in a way that recognises the needs rather than—as Helen Mary Jones touched on a little earlier—what might be considered a fair and equal split through Barnettising support. We have to ensure that support for steel and aerospace through Project Birch—and I am hopeful that UK Government are listening to our calls for support through that particular intervention—that the support that comes our way recognises that, in those two vitally important sectors, we have a disproportionately high number of people employed in Wales, and therefore we would expect, through Project Birch and, in the longer term, through the industrial strategy, the new iteration of the industrial strategy, to have a larger share of the financial resource from those particular interventions.

Finally, I should just say that the third sector that is always, always discussed on those quadrilateral calls is tourism, and I've been at pains to stress the role that UK Government has in developing a support scheme that recognises that, even if businesses within the tourism sector reopen in the coming month or so, they are still going to face challenges in terms of generating enough revenue. They are not going to see the sort of revenue generation that was apparent in 2019, because public confidence is not going to be returning to what it was before coronavirus, and therefore there will need to be a support scheme, regardless of whether or not businesses reopen within the tourism sector. And, again, only the UK Government has the financial firepower to be able to deliver such a scheme for the tourism sector.

Photo of Ann Jones Ann Jones Labour 2:24, 10 June 2020

Thank you very much, Minister.

I've had notice of a point of order from Janet Finch-Saunders. Janet Finch-Saunders. 

Photo of Ken Skates Ken Skates Labour

Janet, we can't hear you.

Photo of Janet Finch-Saunders Janet Finch-Saunders Conservative

I'm just very disappointed—thank you—that, when I raised my question with you, and I mentioned the Welsh Mountain Zoo, you came back—

Photo of Ann Jones Ann Jones Labour

No, no—sorry. Sorry, your point of order is to me as to conduct in the Chamber. So, please refer your point of order to me, and I will make a decision on it. Thank you.

Photo of Janet Finch-Saunders Janet Finch-Saunders Conservative

Okay. Thank you. When I raised my question to the Minister about the Welsh Mountain Zoo, he came back in his response and maintained that there hadn't been a Barnett consequential to Wales for the zoos. I have it on good authority, in writing, that a Barnett consequential has come across. So, I would like the Minister to correct that statement, please.

Photo of Ann Jones Ann Jones Labour 2:25, 10 June 2020

Okay. I will review what exactly was said and we'll come back to deal with this at the end of the session. 

Photo of Ken Skates Ken Skates Labour

There's been no consequential.

Photo of Ann Jones Ann Jones Labour

We'll come back to it at the end of the session. Thank you.