6. What discussions has the First Minister had with the UK Treasury regarding VAT on personal protective equipment? OQ55832

I thank Joyce Watson for that, Llywydd. The Minister for Finance and Trefnydd wrote to the Financial Secretary to the Treasury on 30 October to ask that the decision to reinstate VAT on clinical PPE with effect from 1 November be urgently reconsidered.

I thank you for that answer, but it's actually unthinkable that the UK Treasury would add VAT to PPE and the impact that that surcharge would have on small businesses across Wales who are rightly trying to do the right thing for their staff and for their customers to keep those people safe, and also for charities and third sector organisations, who are providing direct help to people in communities right across Wales, and again trying to keep those people safe. So, will you ask again the UK Treasury to not force this safety tax on Welsh businesses, charities and third sector organisations?

Well, Llywydd, I thank Joyce Watson for that and entirely agree with her. It's unfathomable to me as to why the UK Government has decided that this is the right moment to add additional costs on to essential safety equipment. We are providing PPE on an industrial scale in the Welsh NHS and social care system: 440 million items of PPE already this year, of which 220 million have been provided to social care providers. It will cost, in the Welsh system alone, an extra £20 million, which is money now we don't have to provide services for cancer patients and cardiac patients or the other things that Members on the Conservative benches have been asking me about this afternoon. That money will now be handed back to the Treasury as a result of this decision.

But Joyce Watson is very right to point to the impact on small businesses and charities here in Wales, organisations that are really struggling during the pandemic, whose business model has been very badly affected by it, who are trying to do the right thing, who are spending money on PPE for their staff and sometimes for customers. Now they will be paying VAT. Andrew R.T. Davies suggested to me they'll just get it back. Well, small businesses that are not VAT registered won't get it back at all. Charities that are VAT exempt will not get it back at all. So, I'm glad to see him defend it. I'm glad to see that he thinks it's a good idea that a safety tax should be introduced here in Wales. It tells us a lot about the priorities of people on those benches, that they're willing to pontificate when they think it suits them and then, when something as ridiculous as this happens, they're prepared to defend it as well.