Questions now from the party spokespeople. Plaid Cymru spokesperson, Rhun ap Iorwerth. 

Diolch yn fawr iawn, Llywydd. Now, David Phillips, at the Institute for Fiscal Studies, has argued that the story of the fiscal response by devolved Governments during this pandemic will be one where the said Governments are hampered by limited reserves, constrained borrowing powers, as well as the funding coming to them from UK Government. Now, the Minister has indicated that she has been in discussions with UK Treasury regarding the relaxation of fiscal powers. Could she give us an update about when Welsh Government can expect to see some of that flexibility being introduced? 

Yes, I’d be happy to. I last discussed these specific issues with the Chief Secretary to the Treasury on Friday of last week. And he indicated that the summer economic statement will be forthcoming, and then we’ll have a further conversation after that in terms of the fiscal flexibilities that we’ve requested. And just to recap, for people who aren’t familiar with those flexibilities, we’re seeking an ability to draw down more from the Wales reserve, to borrow more, to remove the borrowing cap, and also to be able to switch capital to revenue. Some of that and how far we want to take things will depend, in large part, on the statement that the Chancellor makes next week, and we will have a better understanding of the funding that we can expect to take us through the rest of this financial year.

Okay. Thank you for that response. To much fanfare yesterday, of course, the Prime Minister announced his build back better plan, an investment of £5 billion to be brought forward. Apart from that seeming an almost ridiculously small amount, given the scale of the challenge that we face, not just in Wales, but across the UK, it seems that not a single penny of that investment could be identified as coming to Wales. Now, as well as raising our collective voice, as a nation, to demand that that is changed, I think we have to be prepared also to say, ‘If they won’t do it for us, we’ll do what we can ourselves.’ And we need a rethink, I think, on so many levels: on the scale of investment we need in Wales and how to deliver it and how to prioritise it; on the fiscal flexibility we need; on reforming taxation even. So, is Government ready to begin or join us in that reform discussion right now, because the quicker we start looking for those innovative ways forward, the quicker we’re surely more likely to find them?

Rhun ap Iorwerth is entirely correct that yesterday's announcement from the Prime Minister was a complete non-event, in the sense that there's not a single additional penny coming to Wales as a result of the statement yesterday, certainly not this year, and all that's happening is that funding is being reprofiled for future projects. So, there was nothing of interest or significance to us here in Wales. That said, we recognise how important capital spend is going to be in the recovery, which is why we're pulling together the programmes that we think will be, and which are really shovel ready in terms of being able to hit the ground as soon as we're able to now, as we move into that recovery phase.

Local government is also working really hard to identify shovel-ready projects right across Wales, so that we are able to get that geographical spread of investment, bearing in mind that some communities are going to be hit particularly hard by the economic fallout of the coronavirus as well. And, of course, we have our Wales infrastructure investment plan, which contains billions of pounds of potential investment as well, so that will be really important.

And finally, I should mention, of course, our plans for twenty-first century schools continue. Our plans in Wales would spend £2 billion over the next five years, and I think that that level of ambition just dwarfs what the Prime Minister announced yesterday for England.

Again, thank you for that response. The one thing I would say: with previous infrastructure development plans that were in place, they really need to be consigned to history, given now the scale of our understanding of the challenge that we have, which is at a different level to what we had previously. It needs to be rebuilt.

I'd like to finally just look at, as businesses are gradually reopening, not all of them are able to move at the same pace as others. One support package that was a lifeline, of course, was the non-domestic rates grants. Will there be another round of NDR grants available for those businesses who are unable to reopen? And also, on tourism and hospitality in particular—facing a full year of little profit, even if some of them are able to open now—what discussions have you had with the economy Minister to make a financial support package available to those sectors and for the longer term as a matter of urgency?

I'll be completely honest, and the level of what we are able to provide in terms of cash straight into the pockets of businesses here in Wales will depend, I think, in large part, on what our financial package looks like in Wales for the rest of the year. So, next Wednesday, we'll have a statement from the Chancellor, which will set out what we would expect to receive from the UK Government in revenue terms for the rest of the year, and I think that we will need to look at that, in terms of the recovery, but also alongside the ongoing pressures that we know we have in terms of dealing with the coronavirus crisis, which still hasn’t left us, despite the loosening of lockdown. So, I can't give any commitment to further grants today.

However, what I will say is that we recognise how important the coronavirus job retention scheme has been for particular sectors. Ken Skates and I wrote jointly to the Chancellor on that specific point, highlighting the need for continued support for specific sectors—so, giving tourism as an example—and also for those businesses who still can't open as a result of the lockdown or the restrictions that remain on particular kinds of businesses, and we'll continue to make those arguments.

Conservative spokesperson, Nick Ramsay.

Diolch, Llywydd. Minister, the recent news about job losses at Airbus has demonstrated the need for support for Welsh businesses at this very difficult time, and that includes the UK Government's furloughing scheme and, of course, Welsh Government support. Now, out of the £500 million pledge for the economic resilience fund, it seems that less than half of that has been used so far. Could you tell us a little bit more about how these allocations are being made, exactly how much of that money has been spent, and how are you as finance Minister ensuring that allocations are building effective resilience in communities affected by closures and job losses?

I think the example that Nick Ramsey has given in relation to the aerospace industry just demonstrates how our support for the economy in Wales has to be a team effort between the UK Government and Welsh Government. Some of these sectors and some of these industries and businesses are so huge and are so strategically important that it is important that the UK Government also steps up to the mark. We talked about Tata, of course, during First Minister's questions today. So, I think it is important to work together to support businesses, and for each of us to do our bit in that.

In terms of the economic resilience fund, we have only allocated a part of that so far, and that's important because we wanted to hold some of that back to help with the recovery. So, our focus in the short term has been shoring up businesses, helping them get through the immediate crisis, but obviously the focus has to turn to recovery and supporting businesses to grow and supporting businesses to develop.

We've also been really focused on filling those gaps, so, again, working to ensure that everything that we do doesn't replicate what's available elsewhere but augments it, and I think that the figure that the ONS has provided, which shows that more than 30 per cent of Welsh businesses have now received support from either the Welsh Government or the UK Government, as compared to 21 per cent in Scotland and 14 per cent in England, shows how important it is that the Welsh Government seeks to augment what the UK Government is able to do. So, they will have a really important role in terms of Airbus and other large employers.

Thank you, Minister. I think you're exactly right to say that this is a two-pronged approach. It is important that, along with the UK Government efforts, we do see that support from the Welsh Government, such as from the economic resilience fund. So, if you can keep us updated on those allocations, that would be helpful.

You mentioned, as we move out of lockdown and rebuilding the economy, that that won't just involve protecting existing jobs in their entirety—I think we have to recognise that that's not going to be possible—and it won't involve simply returning to the old ways of working. It will also involve allocations of funding for upskilling our workforce so that it's fully prepared to meet the global challenges ahead. According to an Open University report published last November, skills shortages are costing Welsh businesses £350 million a year, with many trapped in low-skill traps, and I imagine that those figures are even worse now with the pandemic having taken its duration. How are you ensuring that the allocations made in the recent supplementary budget will be properly focused on rebuilding the economy, particularly a greener, more modern economy, so that we are not just trying to meet the challenges of the past, but we're making sure that Wales is at the forefront of meeting the challenges ahead?

The supplementary budget was more of a response to the immediate pandemic, so it was responding to the acute issues that we were facing, particularly in health and social care and in local authorities, but also on the business side of things. So, I think that, moving forward, as Nick Ramsay says, the focus is very much on employability and skills. A piece of work has gone on across Welsh Government exploring what different departments can bring to the table in terms a new and reinvigorated approach to skills and employability—so, from education to health, and obviously I have a role in that in finance.

But what we do want to see next week from the Chancellor is the UK Government's approach to skills, because, again, we want to augment what's happening. So, if the UK Government takes an approach to support skills and employability through the skills agenda, through BEIS, then we'll receive a consequential and we can do some of our own things here, but if it's the case that the UK Government decides that undertaking this work is better done through the DWP, then we won't receive a consequential. So, we're holding back on our skills and employability plan in terms of saying more about it until we know whether or not the funding will be here for us to take all of the decisions or if we need to work with what the UK Government decides to do potentially through the DWP. But I'm really hoping that the economic statement next Wednesday will provide us with that level of clarity.

Diolch. I'm clearly going to have a lot more questions for you after next Wednesday's economic statement—that's quite clear. Minister, finally from me today, and with my other hat on as Public Accounts Committee Chair, you'd expect me to ask you about the auditor general report that grants worth £53 million to boost the rural economy were made by the Welsh Government without officials ensuring sufficient checks to ensure value for money. Now, this is obviously something that Public Accounts Committee will be looking at in its own time, but I do think the initial indications that the Welsh Government couldn't show that they'd considered whether there was a successful outcome to the spending of the £25 million of grants in particular is concerning. What confidence can the public have and how can you preliminarily reassure the public that the programmes that I've mentioned and which we've discussed today, such as the economic resilience fund, projects to get the economy back on track, will themselves involve effective evaluation and monitoring of public money, so that at the moment, when money is tight, we can see the best outcome from every Welsh pound that is spent and the taxpayer will see value for money in terms of developing that newer, greener economy, meeting those challenges ahead that are so important for moving the Welsh economy forward?

So, we're grateful to Audit Wales for the report to which you refer, and I know that officials will be coming to the Public Accounts Committee in respect of that report and the assessment there of value for money through the RDP, and I think that's the best place to have those detailed and forensic discussions. But it is important to recognise that, as part of our ongoing review of the delivery of the RDP, officials had already identified the issues described in the Audit Wales report and had taken action to remedy them. And, as the report makes clear, the issue of value for money wasn't tested in the appraisal of those projects, so the projects concerned were reviewed to ensure that they did deliver value for money, and, where appropriate, action was taken to ensure that they did achieve value for money, including retendering some of those projects. But of course, since then, as I say, we have identified those issues; we've learned.

So, new guidance has been issued to policy makers, called 'Value for Money in Challenging Times: Key Economic Principles', and that sets out those key economic principles that, if followed, can deliver good value for money. Also, a revised finance notice, 'Making the Most of Welsh Government Funds', was also published, and that provides policy colleagues with the advice that they need to ensure that there is a much greater focus on value for money. And work is also ongoing on developing a value-for-money module into the compulsory core finance training for Welsh Government senior civil servants and, into the future, the roll-out of equivalent training for executive band staff. So, we're ensuring that value for money is well understood and well practised by the civil service.

The Brexit Party spokesperson, Mark Reckless.

Will the finance Minister make a statement on her latest assessment of the amount of tax revenue that we will lose by having a longer and stricter lockdown in Wales than the UK Government has been applying in England, and could she clarify what level of transitional protection we have over revenues to the Welsh Treasury from land transaction tax and the Welsh rates of income tax, and also advise whether there is any risk that we could be caught by the 'no detriment' rule in terms of UK revenues from income tax raised in Wales if they are significantly affected by decisions her Government are taking to maintain lockdown?

I thank Mark Reckless for those questions. I think it is possible to say two things. The first is that Welsh taxes will be affected by the coronavirus outbreak, but it is impossible to say at this point to what extent that will be and to what extent it will be different to that across the border in England. I think it's worth reflecting that we're not as out of step with what's happening in England as might be suggested. We are only a couple of weeks different in some respects to what's happening across the border, and already we see some areas of England going into local lockdowns. So, there'll be all kinds of different considerations that will play out in the period ahead and which will impact on taxes. But, overall, as Mark Reckless knows, we are protected from UK-wide economic shocks through the block grant adjustments, so I don't think that the impact on land transaction tax, for example, or landfill disposals tax will be of a significant order.

We all support the furlough, job retention scheme, at least as it has operated to date. Can I ask the finance Minister to clarify the Welsh Government's position on any potential continuance? The scheme was brought in initially for a few months to ensure people didn't lose jobs, remained in contact with their employer in that contractual relationship, so that the economy could quickly restart, hopefully with a v-shaped recovery. The First Minister earlier, though, I think in the context of Airbus in Broughton—. I see that Ryanair is being told that it shouldn't be flying out of Cardiff today, although I think because it uses only Boeing aircraft, perhaps that not's an issue. But, if the air industry is going to take many years to recover and demand is going to be greatly lower not for months, but for years, is it not inevitable that output of aircraft is going to fall sharply and remain lower for a long period? And in those circumstances, do we need to be looking at another purpose for the furlough scheme, and if there is any extension, are you suggesting that that should be to keep people in most affected industries furloughed for a period of years? Or do you recognise that for people in industries unfortunately affected very badly for a long period, or for at least some of those people, it may be better to retrain and take opportunities and look to develop their careers elsewhere if the impact is going to be so severe and so long term? 

I think what we want to avoid is a cliff edge for people. So, you'll have seen the statement that Ken Skates has put out in terms of aviation and the aerospace industry here in Wales and how important it is, and you'll have heard what I said to Nick Ramsay in terms of how important it is that Welsh Government and the UK Government work together. So, in terms of the job retention scheme, I do think that there is a case for industries that were particularly hard hit to receive support for longer, and actually aviation was one of those sectors, which, alongside tourism, Ken Skates and I both mentioned in our letter to the Chancellor. Two things need to happen at the same time: people need to be kept with the support that they need, but also new jobs need to be created and new opportunities need to be found for people, because, even under normal circumstances, in an average week we lose 2,000 jobs here in Wales but another 2,000 are created. So, we need to ensure that that pipeline of new jobs comes into line, and I'm really aware that, particularly in Airbus, for example, the individuals there are very highly skilled, and I think that we need to ensure that the kind of employment that we're able to offer in the future continues to be in high-skilled and well-paid roles.