10. Economy, Infrastructure and Skills Committee Debate on the effects of COVID-19 on Wales's Economy, Infrastructure and Skills

Part of the debate – in the Senedd at 4:25 pm on 1 July 2020.

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Photo of Huw Irranca-Davies Huw Irranca-Davies Labour 4:25, 1 July 2020

I thank the committee for their reports, as they've shone a helpful light on the economic response to the COVID crisis from the Welsh Government and the UK Government, and also how partners, like local government and Business Wales, have really stepped up to help businesses and employers and employees through these unprecedented and difficult times. It is worth noting, of course, that our Government in Wales has really stepped up to the mark, providing the most generous package of support across the UK and trying to fill some of the gaps left by the UK Government support. This has really shown the positive difference that devolution can make, though we do still have gaps. In respect of the UK Government's support and putting aside the gaps, we have to acknowledge the scale of investment, not least in the furlough scheme, but I'd strongly urge our Welsh Government Ministers to join other devolved Governments and, indeed, the UK Labour frontbench calls for extending the furlough and support for particular sectors, including, by the way, aviation, but also parts of our tourism and hospitality sectors, and our arts and cultural sectors, too.

Now, this is the moment when the Prime Minister needs to show that he really is a Prime Minister for the whole of the United Kingdom, not just a Prime Minister for England. The 'Build, build, build' programme announced this week is small, small, small and, indeed, is currently England, England, England only. So, I hope the Prime Minister will take the opportunity to work with Welsh Government to identify Welsh priorities for UK investment right now in Wales, including support for aviation, and that should include, as well, major long overdue UK investment in steel, in Wales marine and tidal renewables, and in a new generation of automotive production and more. It should make good the decade-long UK underinvestment in rail infrastructure in Wales, and support for Welsh Government to boost the skills and apprenticeships and job schemes for young people in Wales and much more. There is a real opportunity for the UK Government.

This is a time for bold decisions on the scale of the post-war Attlee Labour Government and with all Governments across the UK working together. Indeed, let us have that UK COVID response emergency budget before the summer break, which can respond to the scale of the crisis and also give the Prime Minister the real opportunity to show that Wales is not some afterthought from a desk in Westminster.

Now, returning to the current support for business and jobs, the committee has done sterling work in identifying the gaps, and I recognise these from my own constituency cases, including that of Chris, who runs a gym. He took over a derelict former club, turned it into a home not just for the gym, but for a thriving group of families with children with special needs, and as the base for a local football club and more. But he's missed out on all the support, including the recent welcome changes that drop the VAT threshold to £50,000. It left him just a few thousand pounds short of the threshold for qualifying. So, I just wonder, Minister, if there can be some flexibility for Business Wales to work with small businesses that they know, to avoid these heartbreaking narrow misses?

In giving evidence to the committee, some of the obvious gaps that were highlighted included the self-employed people who didn't have recent accounts, businesses that don't operate out of a property as such and companies that are not VAT registered. I know that Welsh Government has continued to tweak and adjust the support to respond to some of these gaps, and I'd be grateful if Ministers could keep on listening, keep being flexible, to respond to these ongoing concerns, but also to keep engaging with the UK Treasury to respond to and fill these gaps on a UK-wide basis. The UK Treasury has incredibly deep pockets, and, indeed, they've recently discovered the location of the allusive magic money tree, which Conservative Chancellors argued for a decade of austerity simply did not exist. I'm glad they've found it. 

We've just experienced the sharpest economic downturn since the third quarter of 1979. The Bank of England economist Andy Haldane suggests that we could be on track for a v-shaped recovery with faster than expected regrowth, although he wraps his projection with many, many economic health warnings. It could go very differently indeed.

We certainly now know already that places that have faced long-term structural challenges—deep-seated social and economic disadvantage—will be the most vulnerable. So, we need the investment hereon to redouble its focus on those areas, including those places and people in my constituency of Ogmore, where the benefits will be greatest for the poorest of investment, where we can lift people the highest, and where we level up through activist Government intervention, rather than the free market devil take the hindmost. So, let's make this COVID economic response one that levels up across the UK, levels up in Wales and levels up in Ogmore, with Governments at all levels playing their part. I thank the committee for their reports, because they are useful in directing some of those efforts. Diolch, Dirprwy Lywydd.