5. Statement by the Minister for Finance and Trefnydd: The Mutual Investment Model

Part of the debate – in the Senedd at 5:07 pm on 17 November 2020.

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Photo of Rebecca Evans Rebecca Evans Labour 5:07, 17 November 2020

Thank you. Earlier this year, I welcomed the report of the Finance Committee into sources of capital funding and its recommendations regarding the mutual investment model. A lot has happened since that time. Hard on the heels of a decade of Westminster-imposed austerity, from which our capital budget has barely recovered, a pandemic has struck Wales—twin threats that we must address by delivering projects that will drive forward our economic recovery, creating employment, training and supply chain opportunities. The mutual investment model will help us do just that, accelerating investment in projects that would not otherwise have been affordable.

Our strict approach to the use of MIM remains unchanged. We use conventional capital first to fund public infrastructure and we will we use every penny of it. We'll then use our limited borrowing powers. We have also enabled local authority and housing association borrowing to maximise support for the urgent needs that our communities face. But even that is not enough to cover those urgent needs.

We have developed a carefully designed model to meet those needs in the face of a decade of austerity, which we must remember began with dramatic cuts to capital budgets at a UK level. And so, today, I want to set out how the model will contribute to our economic recovery while delivering stretching community benefits, without putting further strain on our limited capital budgets. I also want to say a few words about how the Development Bank of Wales is acting as the public shareholder in MIM schemes, increasing transparency and improving value for money for the public sector.

I am delighted to report that, at the end of last month, we awarded a contract to the Future Valleys consortium to complete sections 5 and 6 of the A465 dualling project. This scheme will complete the dualling of the A465—a long-standing commitment of the Welsh Government—and ensure that the full range of benefits are realised for the region. It will complete a continuous, high-standard alternative route to the M4, improve the critical northern cross-valley link for the south Wales metro, provide reliable access into the metro hubs and contribute to modal shift. The scheme will improve accessibility to jobs, key public services and facilities for active travel in the region.