9. Short Debate: The challenges and opportunities for the Môn economy: An opportunity to take a broad look at the Môn economy, including serious concerns around Brexit, challenges and opportunities in relation to energy, and how to ensure community and environmental sustainability when creating new economic opportunities

– in the Senedd at 6:43 pm on 30 September 2020.

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Photo of Elin Jones Elin Jones Plaid Cymru 6:43, 30 September 2020

(Translated)

The next item on our agenda is the short debate, and the short debate will be presented by Rhun ap Iorwerth. I call on Rhun ap Iorwerth to introduce the topic that he has chosen. Rhun ap Iorwerth.

Photo of Rhun ap Iorwerth Rhun ap Iorwerth Plaid Cymru

(Translated)

Thank you very much, Llywydd, for this opportunity to address some of the challenges and opportunities facing the constituents that I represent on Anglesey and, as an important part of a wider regional economy, the challenges and opportunities that apply beyond the bridges as well. Some of them are old factors related to our location or geographical features; others are newer—consequences of a challenging political or economic context.

I will try to give an overview of where I think we are. I'm looking forward to seeing whether the Minister agrees with me on some if not all of my impressions, and is ready to commit to supporting us on Anglesey in every way possible to deliver on our aspirations as a community on the island. Yes, what I have to say may sound depressing at times. There are issues of real concern, which I will mention. How often have I heard people say, 'There are no jobs here. There's nothing to keep our young people here', and recent events have reinforced those feelings. But I'm an optimist and I can see many opportunities—opportunities that already exist that need to be nurtured, and other new opportunities that are emerging at the moment, and we need to pursue them with all our might.

(Translated)

David Melding took the Chair.

Photo of Rhun ap Iorwerth Rhun ap Iorwerth Plaid Cymru 6:45, 30 September 2020

(Translated)

I was brought up in Anglesey. The island always had a strong hold on me, and I suppose when I met the Anglesey girl who would later become my wife, that relationship was cemented once and for all, and that's what ensured that I would also return to Anglesey to bring up my own children. And, yes, I did return, because like so many of our young people, I left—I went to university, to work, in Cardiff, and London for a while, but I know that not everyone feels that they have that same opportunity to return, or to not leave in the first instance.

An opportunity to keep our young people, or to bring some of them back, was the main appeal of Wylfa Newydd locally. Of course, it wasn't supported across the board, by any means. Hundreds of long-term jobs, a prosperous period during the construction phase, but also an extremely challenging period—a period that could, without very robust mitigation measures, have a severe impact on our communities. And pushing for that mitigation, promoting local benefit, local job opportunities—that was always my priority when dealing with that development, and I did that working very closely with the county council. And the developer did understand the importance of those things; I have no doubt about that. But now, of course, that development has been put on hold—a major economic blow in terms of the jobs and local revenue promised. There's no escaping that. And I will continue to work and to discuss with Horizon as they consider whether, or how, to resurrect the scheme. But we have to be prepared to consider that we now have a new context, a context where relying on one major investment cannot be seen as a panacea. And certainly, there are major risks in raising people's hopes again without having solid foundations for doing that, and I know the Minister would agree with me on that.

So, we do need to look at our other strengths and opportunities. I've heard some say that years have been lost or even wasted—years that could have been used in developing new alternative plans. Well, the good news—and I've always argued this point—is that not all our eggs were in one basket on Anglesey. They may not have generated the same headlines, there may have been far less scrutiny of them individually, but taken together, there are other very exciting initiatives in the pipeline in Anglesey that have been quietly gathering momentum in recent years, and now, more than ever, they need support to make them a reality.

Well, where to start? Let's start with energy: the energy island programme is still alive and kicking. We are an island that has pioneered for centuries in renewable energy. We know that Anglesey is often described as 'mam Cymru', the mother of Wales, but in order to provide food for her children, there were almost 50 windmills milling wheat across the island over the decades. Whilst declaring an indirect interest here, not only that my mother-in-law used to run a restaurant in one of Anglesey's most famous mills, Melin Llynon, and that my in-laws were involved with the development of wind energy on the island in the 1990s, we as an island now are turning our sights to the sea. The appetite for clean energy is growing and when the next offshore windfarms off the northern coast develop to the west of the current windfarms, well, let's make sure that Holyhead is the port that serves them, as Mostyn has served the more easterly windfarms so effectively.

And under the sea, let's help to get the Minesto installation scheme over the line, turning their research into a commercial venture that will bring good jobs to Holyhead. We need to ensure that Morlais energy scheme goes ahead—a testing area for tidal current technologies that will bring local benefits in terms of jobs and investment, as well as allowing research of international importance. And it's being run as a social enterprise by Menter Môn, which will direct the economic benefit to our communities and young people. Yes, it needs to be developed carefully and cautiously—that's true of every new technology—but the Welsh Government needs to do everything it can to help secure this investment so it can move on to the next phase, and likewise the UK Government.

Photo of Rhun ap Iorwerth Rhun ap Iorwerth Plaid Cymru 6:50, 30 September 2020

(Translated)

Like so many energy developments, it's supported by expertise from School of Ocean Sciences at Bangor University, a school with a reputation for international excellence, and a school located in Menai Bridge on Anglesey. And may I thank the Government here for a positive response to my calls for a renewed agreement with the university to secure the future for their research vessel, the Prince Madog? There will be need for further support for this resource in years to come, which is important not only to developments on Anglesey, but to our national energy ambitions too.

Now, to return to the land, and to Gaerwen, where the M-Sparc science park, again part of Bangor University, shows what ambition can deliver. And I pay tribute to my predecessor, Ieuan Wyn Jones, for delivering that. The fact that M-Sparc has filled so quickly with innovators who have decided that their future is on Anglesey is an inspiration. I look forward to seeing the next phase of the development, and the following phase, as a statement of confidence in our hi-tech and innovative future on the island.

One development that we don't yet have a physical location for, but one that I'm looking forward to see delivered by a Plaid Cymru Government, is the headquarters of a new public energy body, Ynni Cymru, a body that can offer so much to us—co-ordinating energy developments, leading on the creation of a truly green Wales, including a national retrofitting programme, and trying to drive clean energy prices down for the people of Wales. And where better than the energy island to house this new body?

Here's another energy development that Ynni Cymru could help to develop. There is some very exciting work happening under the auspices of Menter Môn again, entitled 'hydrogen island'. Now, I led a debate in the Senedd in February outlining the benefits of hydrogen in the decarbonisation agenda on the day of the launch of the new Wales Hydrogen Trade Association. Well, already, through the work of hydrogen Môn, we are seeing major scope to develop hydrogen on the island, using clean energy to produce it, produced locally. Again, I ask you, Minister, to consider how the Welsh Government can help to deliver this, and there are a raft of partners ready to support this.

But, whilst there is huge potential in the energy sector, let me bring you back to those windmills I mentioned. The tradition of food production on Anglesey is still strong and growing. I've been trying to persuade the Government over the last few years to develop a major food production facility in Anglesey—it's a perfect development for us. And although I've been discussing this issue with the Minister for environment and rural affairs, I would like to draw you in as the Minister for economy too. What's happening at the moment is that an impressive number of companies—more and more companies indeed—have been spending on converting other business premises into appropriate places for food production. I am still convinced that it would be better to prepare bespoke properties for them, to create a hub, or even hubs, for food production, which could also be a shop window for the sector too. The food technology centre at Coleg Menai is exceptional, it's grown recently, and we should be creating the spaces locally and providing the support to businesses starting their journey, so that they can grow and develop and employ people on Anglesey.

Of course, the food production industry goes hand in hand with the agricultural sector in Anglesey, which is second to none. It helps to create that green image—an image that's so important in terms of tourism too. Now, I don't have time to focus too much on tourism here, but I will say that it is hugely important to us. What I will also say is how important it is to create a tourism industry that is truly sustainable economically, environmentally and culturally, and also sustainable in terms of being sensitive to the fragility of our housing market, a very topical issue at the moment. I'm truly pleased to see what feels like a real debate starting on that within the tourism sector in Anglesey and beyond. I think now is the time for that to happen.

Returning to agriculture, we are facing one of the biggest challenges that we have faced, and that is our departure from the European Union. I was amazed to see the Conservative Anglesey MP voting against amendments to the Agriculture Bill in the Commons recently that would have helped to protect the interests of farmers in Anglesey as we depart the European Union. The amendments would have made sure that agricultural imports under new trade agreements had to meet the same high standards as the farmers of Anglesey. By rejecting such amendments, she undermined the farmers that she is representing. That, of course, is on top of fears of losing markets because of Brexit.

And Brexit brings me to the port of Holyhead. Trade through the port grew incredibly quickly after the creation of the European single market. Holyhead is the second largest roll-on, roll-off port in Britain. It has shaped the economy and character of the area—over 1,000 people are directly employed and many more indirectly. And there is a real nervousness in looking at clause 40 of the internal market Bill and the likely impact that that will have on the flow of trade coming from Northern Ireland at the moment—a third of the traffic in total—that would move perhaps to England or even to Scotland.

If difficulties and paperwork and delays happen—. They talk about developments in Kent on the news all the time, but there's hardly any talk about developing resources in Holyhead, and there are only weeks to go until departure. It tells you everything about the attitude of the UK Government towards the port of Holyhead. These things do fill me and the people of Anglesey with dread, and we need a solution. But I will do everything I can to urge the Welsh and UK Governments to ensure that we have a prosperous future, despite Brexit.

Now, to conclude, Llywydd, very good news on Anglesey last weekend—we succeeded in attracting the Island Games to Anglesey in 2025, or perhaps a year or two later, depending on COVID. They are games that are very happy; they draw thousands of sportspeople from islands across the world to one of the biggest events of its kind in the world in terms of multisports. I'm very grateful to the Government for pledging its support for that, and also Anglesey council. There's been a small group of us as a committee that have been working hard to reach this point, and I would like to thank the Island Games volunteers, who have worked so very hard.

But, in these parlous times, it's good to have something to look forward to, and it will be something for us as a community in Anglesey to look forward to. And the message today, with the right support from Government, and with a spirit of enterprise: there is a very bright economic future that we can look forward to on Anglesey.

Photo of David Melding David Melding Conservative 6:58, 30 September 2020

(Translated)

I call on the Minister for Economy, Transport and North Wales, Ken Skates.

Photo of Ken Skates Ken Skates Labour

Diolch, acting Deputy Presiding Officer. Can I begin by thanking Rhun ap Iorwerth for bringing forward this short debate today, and also thank the Member for his participation in last week's round-table discussion concerning the future of the Wylfa site?

There's no escaping the severity of the wider economic situation that we face right now across Wales, across the globe, and particularly on Ynys Môn, where a number of unfortunate announcements have been made in recent times. On Anglesey, we've already provided, though, £4.1 million of support to more than 250 businesses through the first two phases of the economic resilience fund as we try to fight the economic impact of the virus, and that funding will help those businesses through the pandemic.

Now, the funding is over and above what was announced by the UK Government and, just this Monday, I announced the next phase of the economic resilience fund, a further £140 million for businesses across Wales to help them deal with the economic challenges of COVID-19 and also—also—the UK's impending exit from the EU transition period.

Photo of Ken Skates Ken Skates Labour 7:00, 30 September 2020

Now, a key component of Anglesey's economy is, as Rhun has identified, tourism and hospitality. So, the £20 million that has been ring-fenced as part of the third phase of the economic resilience fund will be vitally important to many businesses on the island. We're also looking at how we can use the third phase of the ERF to stimulate employment opportunities for under 25-year-olds. There will be an incentive to take on young people who would otherwise be further marginalised and left behind as we look towards a recovery.

Now, I have to say to Members I do welcome the Chancellor's recent decision to extend the VAT reduction for the hospitality and tourism sector until March of next year. I also welcomed his decision to extend repayment deadlines for businesses that have deferred VAT and provide more flexibility for businesses that have taken out Government-backed loans. Overall, though, the measures announced back on 24 September are unlikely to be sufficient to prevent a large rise in unemployment in the months ahead. 

Here, in Wales, we've made the pledge to support everybody to find work, education or training or to start their own businesses, and we're supporting that pledge with £90 million of funding. The economic recovery group for the north Wales region is also considering how we can collectively deliver support to businesses right across north Wales in line with the significant support that we're already providing across the whole of Wales through the Business Wales service.

In the meantime, we'll continue to press the UK Government to take bolder steps to assure our economic recovery and support future prosperity for businesses and people across the UK. We were, naturally, deeply, deeply disappointed by the announcement by Hitachi back in mid September. And I know, I am acutely aware of how the announcement has been felt on the island, and in particular in the north of Anglesey. It'll impact, as Rhun has identified, not just on Anglesey communities, but also on the north-west of Wales and indeed the wider region of north Wales. Wylfa, though, is still the very best site in the UK and Europe. It's a fantastic site, it's one of the best for large gigabyte scale nuclear or small modular reactors, and I remain confident that this is not the end of the road.

We can only address the challenges we are now facing by working collaboratively for the benefit of the people, businesses and communities of north Wales and Ynys Môn. Co-ordinating and co-designing our short, medium and long-term actions and priorities is a key and that's why I hosted that round-table event that I've already mentioned, which Rhun ap Iorwerth attended. I thought it was a constructive meeting, where we took stock of the Hitachi announcement, naturally, but where we also agreed on our respective roles and responsibilities on the next steps. Several issues were raised at that meeting and, indeed, in pre meetings with the leader of Ynys Môn council. Many have already been raised by Rhun ap Iorwerth, including not only the future of the Wylfa site, obviously, but also other important matters, such as the need to establish a border control post on the island. So, I'll now be holding regular tripartite meetings with the Secretary of State for Wales and the leader of Ynys Môn council to discuss the progress that we are all making on developing these important matters.

In the meantime, of course, we'll continue to provide every support possible to businesses on Anglesey, and Rhun ap Iorwerth has today identified numerous opportunities on the island that we as a Welsh Government are investing in. We're currently working with both Menter Môn and Ynys Môn county council on funding for a feasibility study for a green hydrogen production plant and a fuelling distribution hub on the island, and this will further develop plans to establish an embryonic hydrogen economy on Ynys Môn and for the north-west of Wales as a region.

We're also supporting other businesses, such as Joloda Hydraroll in the community area of Gaerwen, Rondo in Llangefni and, of course, Boxed Solutions at Parc Cybi in Holyhead. All three businesses, either with or following initial Welsh Government funding, are now planning their future expansion programmes, and we're pleased to be able to offer our support to these important projects.

We continue to regularly collaborate with the local authority to further enhance the business-ready infrastructure, such as transport links and other benefits that can be realised within the Anglesey enterprise zone. We've recently invested £1.6 million, as part of a joint venture with the local authority, to deliver 30,000 square feet of new industrial starter units at Penrhos, which are due for completion just next month.

On energy, hugely important, as Rhun has identified, not just in terms of providing employment, but in giving the island, and indeed north Wales, a great positive image. Ynys Môn is leading the way; it's leading the way in terms of innovation, ensuring flexibility and smart approaches to electricity networks. The island is also becoming a hub for tidal stream development, but further development will be dependent on revenue support from the UK Government. I can assure Members that we'll be providing further evidence for the need for UK Government revenue support for marine technologies in the current call for evidence. And I'm proud that Wales has two zones for demonstrating wave and tidal streams arrays, reducing some of the uncertainties that lead to a high cost of capital and providing developers with opportunities. Both are supported with EU funding, one being the Morlais site in Anglesey.

Rhun ap Iorwerth also mentioned another key sector for Ynys Môn, that being the food production sector, and I was delighted that one of the most innovative proposals to the foundation and economy challenge fund came from Anglesey. It was the Môn shellfish programme, which is seeking to introduce more shellfish into schools, community centres, introducing people to what is, actually, a relatively simple way of cooking—I know that, because I took part in one of their cookery classes—and I'm hopeful that this particular challenge fund innovation will be a great success. All of the indications are that it already has been, in many communities across Ynys Môn.

And, of course, the Island Games success that Rhun has pointed to. What a fantastic shot in the arm; we desperately needed good news, and Team Ynys Môn delivered it for us. And I was delighted that, as Welsh Government, we were able to sign off at £400,000 to help secure and deliver this fantastic event.

I have to mention the growth deal, of course, the north Wales growth deal. It's progressing well and it will be an important component of future recovery across north Wales. There will be several opportunities, as I know Members are aware, for projects on Anglesey through the growth deal. It provides an opportunity for north Wales to bring forward renewable energy and innovative low-carbon projects, and we're exploring the wider potential of Holyhead port as a fine gateway to north Wales and to the UK. So, I remain focused, I can assure Members, on signing that final deal agreement, the growth deal, by the end of this year, with the North Wales Economic Ambition Board and the UK Government, so that capital investment can start flowing through the region and to Ynys Môn in 2021. So, I'll naturally keep Members updated, and I'll work across party political divide in a concerted and collaborative effort to strengthen the economy and the communities of Ynys Môn.

Photo of David Melding David Melding Conservative 7:08, 30 September 2020

(Translated)

Thank you very much. That brings today's proceedings to a close.

(Translated)

The meeting ended at 19:08.