2. Questions to the Counsel General and Minister for European Transition (in respect of his European transition responsibilities) – in the Senedd on 11 November 2020.
2. What contingency planning is the Welsh Government undertaking in the event that the UK leaves the EU without a deal being agreed? OQ55841
The 'End of Transition Action Plan 2020', which I published today, sets out the actions that the Welsh Government and partners can take to mitigate some of the challenges for Wales following the end of transition, including in the disastrous event of exiting the transition period without a trade deal.
Thank you. The risk of the UK leaving the transition period without a deal on our future relationship with the EU is very real, as acknowledged. All credible evidence suggests that there will be significant adverse economic consequences of any such abrupt and drastic change to our trading relationship within the EU. So, Minister, what assessment has the Welsh Government made of the potential damaging effect this could have on employment in Islwyn, and what mitigation is available to counter this, bearing in mind the damage the current internal market Bill proposals could have on Welsh control of Welsh spend?
I agree with the Member that all the credible evidence shows that a 'no deal' outcome will have a very, very detrimental effect on the economy, and that, over the long term—so 10 to 15 years, perhaps—that could result in incomes being around 10 per cent lower than what they would otherwise have been. And by the way, the UK Government's own analysis is broadly consistent with that picture. There would be a really significant impact on major sectors of leaving the transition period without a deal. And that would be happening, and I don't need to remind her of this, at a time when the economy is already suffering the impact of the COVID pandemic. So, in that sense, choosing to leave on that basis could not come at a worse time.
She will be aware of the economic interventions the Welsh Government has already made, either through the European transition fund or, more latterly, through the later stages of the economic resilience fund, designed to help businesses be more resilient, and be resilient as employers, into the future. And there is a broad suite of business support available on the Welsh Government's websites, which seeks to assist employers to maintain their position. And, indeed, a number of the interventions that have been brought forward in the context of COVID, around employability and job support in particular will, of course, benefit her constituents in the context of leaving the transition period without a deal as well.