The Conservative spokesperson next, and it's Paul Davies.

Diolch, Llywydd. Minister, after a year and a half, as you know, the coronavirus job retention scheme is now coming to an end. Now, the furlough scheme has been an enormous support to thousands of businesses and people across Wales throughout the pandemic, and as that scheme now comes to an end, there will be some very serious challenges for some businesses and employers. Of course, the Welsh Government will have known for some time that the job retention scheme is now set to end and has had time to consider how it can now best support Welsh businesses going forward. Therefore, Minister, what assessment have you made of recent labour market trends to identify the types of workers and businesses that might find difficulty once the furlough scheme ends? And can you tell us what the Welsh Government has been planning to do to support businesses that may face labour market challenges in the coming months?

Well we still face a couple of difficult challenges as we move forward. So, it is true to say we have undertaken an assessment to try to understand those areas of work that may yet be affected as furlough comes to an end. Most employers, though, will already have made choices, because furlough has been stepped down and more people have been returning to work and coming off furlough. We do, though, expect that some employers, particularly in less well-off parts of the economy, at the point that furlough finally ends, may then be making choices about what they do with their workforce and whether they carry on with their business. Now, the difficulty there is that, actually, our engagement with those businesses relies on them coming forward to speak to us directly about the sort of support that they could have. But we continue to work with a range of business organisations to try to understand how we can best support them. In some sectors, of course, there's a significant amount of support to the end of the year—the continuation of the business rates holiday for a range of sectors that have been hard pressed. But we'll only know the real issues in the economy once furlough has ended, and once we see the direct impact of the choices that individual businesses will make. Larger and medium-sized businesses, though, are likely, in terms of our engagement with them, to have already made those choices.

The challenge is difficult because we know we're not yet out of the pandemic, and it is possible that we may need to take action through the autumn and the winter as a result of the unfinished pandemic. Our ambition, though, is not to have to do it, which is why we reiterate for people to do the small but important things they can do to help prevent the pandemic getting back into a position where it could threaten the ability of our NHS to function: to wear masks in particular, where they need to; to test regularly when they're going in and out of different places; and, of course, in reminding people about the first question from your colleague Peter Fox, working from home wherever possible; and to have that sensible conversation to keep coronavirus under control. 

But, Minister, as we emerge from the pandemic, the Welsh Government must now publish its strategy for supporting businesses. The programme for government claims to support Welsh businesses to create new jobs, find new export markets and invest in the sustainable green industries of tomorrow. But, Minister, there's been very little evidence of any of this activity taking place, and we're yet to see a clear vision on how the Welsh Government intends to build the Welsh economy post pandemic. So, can you, therefore, tell us when the Welsh Government's economic strategy will actually be published so that businesses can see the Welsh Government's direction of travel post pandemic? And, in light of your programme for government, can you tell us what targets you've set yourself to deliver new jobs, new export markets and new investments in Wales? Because, if you are as ambitious as you say you are, then, surely, you must have set these benchmarks to monitor your progress as a Government. 

Well, you'll see a number of things we already have done, for example, the work that we're doing on supporting exporting industries—the export action plan that's already in place. You can, though, expect to hear more from me about taking forward the economic mission over the next month or so. So, it won't be much longer that you have to wait for much more detail on our ambitions and how we're going to work with businesses through, as I say, a time that is still challenging, but we're looking forward to recovery post pandemic. 

Well, yes, we do need to see and hear more from you, Minister, and see what your strategy is going forward, as we emerge from this pandemic. Now, Minster, the United Kingdom Prosperity Index 2021 report says that some areas of the UK

'are experiencing especially significant challenges in productivity, competitiveness and dynamism',   and, unfortunately, Wales is one of those areas.

'These areas typically have low business survival rates, fewer high-tech businesses, and few new businesses starting.' 

That same report showed that

'Businesses in Wales have a weak Investment Environment with low capital supply, little demand for expansion, and 31% of projects are delayed due to a lack of financing', which is, unfortunately, the highest rate in the United Kingdom. Now, the Welsh economy is crying out for leadership, and yet, since the election, we have seen so little from the Welsh Government in terms of its commitment to the Welsh economy, and businesses across Wales deserve much better. So, Minister, can you tell us what new ideas the Welsh Government has to create conditions for enterprise here in Wales? And can you make it clear for businesses in Wales today what exactly the Welsh Government is doing to strengthen Wales's investment environment so that our home-grown businesses have opportunities to expand and grow, particularly as we now emerge from this COVID pandemic? 

Well, you can expect to hear more from this Government about what we expect to do to be able to invest together with businesses. You can expect to hear that as part of further reforms in taking forward the economic contract. You can expect to hear that when I do indicate over the next month further detail on what we're going to do to try to restart the Welsh economy to build back better. But it's also an undeniable reality that investing in financing for business is something that we recognise. It's also a reality that investing in the skills and talent of people is hugely important as well, to help deal with some of the prosperity challenges that we know that we have. And it's why yesterday's statement was so important, about the certainty that we need and that businesses need to be able to plan. If there is a cloud looming over our ability to continue to invest in skills across the economy, such as the future of post-European funds, on which we rely a third of to fund our apprenticeship programme, that is a huge uncertainty for us and for businesses. If the Development Bank of Wales, which supports thousands of jobs in every constituency and every region of Wales, has uncertainty about its ability to continue to be funded and supported, that, again, is a very practical challenge for us.

So, actually, there are choices for us to make, and I will certainly set out the choices that we wish to make and how we'll go about doing that, but we could do so much more if there was a UK Government prepared to at least be a willing and constructive partner and to make some choices to work with us, not against us. And I look forward to seeing what happens with Michael Gove at his new ministry and, more importantly still, what happens when the spending review and budget are finally delivered at the end of October.

The Plaid Cymru spokesperson, Luke Fletcher.

Diolch, Llywydd. And as we come out on the other side, now, of a busy tourism season, we should take this chance to reflect and work out how we can in future best promote Wales as a top-quality and sustainable tourism destination. I'm sure the Llywydd will be glad to hear that I spent some of my time in Ceredigion over the summer, and I'm sure the Minister, of course, will agree that areas like Ceredigion offer a story to tell and a lot of experiences for tourists. 

The reality is we need to see financial support for the sector, with a particular focus on cultural tourism and food tourism, both of which are particularly relevant to rural Wales. The Welsh Government have factored a consultation on legislation, permitting local authorities to raise a tourism levy as part of their programme for government this term. We now need to work together in consultation with the sector, local authorities and local communities to consider all options and to properly reflect on the benefits and negatives, of course, of a levy in other countries, such as France, Austria and Germany. Could the Minister outline what further work is being done regarding a tourism levy and how he sees it working in Wales? And would he agree with me that any levy should prioritise making our communities sustainable in a way that sees tourism as something communities are a part of, rather than it being something that is being done to them?

Yes. Look, we are very fortunate to have a tourism industry that has had lots of extra demand coming into it, but that's been a challenge for some of the communities that host some of those tourist hotspots. I have enjoyed it myself, taking my own family around Wales. I've enjoyed time on the Llŷn peninsula, and I've enjoyed time on the island up in Ynys Môn, and we've had a great time seeing parts of Wales we haven't seen before. And most tourists—we certainly have been—are respectful and have appreciated the opportunity to spend time and money in Wales. Our challenge is how we have, as you say, a thriving industry and have local infrastructure that supports that and doesn't push aside the interests of people who live in those communities year-round but recognises the economic benefits that they can produce. 

The tourism levy is part of that consideration, and our starting point has been a tourism levy that does, as you've indicated, build on successful practice in other parts of the world, including in Europe. And many of us, pre pandemic, were going abroad to major destinations like Italy, Spain, Portugal and France. They have tourism levies, and they're normally designed for local choice and for local circumstances to be taken account of. So, when we go out to consult, it will be myself working with the finance Minister, because it is looking at the tax principles, which the finance Minister's department look to ensure, to understand how that could work, how it could work with local authorities making choices about what to invest in, to make sure that tourism is a real positive for those areas and takes proper account of facilities and infrastructure. 

Diolch, Weinidog. Looking ahead, beyond the short to medium term recovery and to that longer term strategy for recovery, one way we can ensure prosperity for local communities in Wales is through supporting community co-operatives, social enterprises and the Welsh foundational economy. The pandemic has highlighted that a strong and supported foundational economy is crucial. In some areas of Wales, the foundational economy constitutes the whole economy. We know that four in 10 Welsh jobs are part of the foundational economy, and that £1 in every £3 spent in Wales is in that foundational economy.

Now, the Institute of Welsh Affairs has recommended the formalising of a 'Think small first' principle to embed local consumption habits in Wales. This should help to support the foundational economy, which has proven key during the pandemic and in boosting the Welsh economy more generally. Regulation serves an important role in providing consistency and a level playing field to small and medium-sized enterprises and local businesses, especially in the foundational economy. However, the number of SMEs considering working for the public sector is falling, and 51 per cent of respondents in the Department for Business, Energy and Industrial Strategy's small business survey described regulation as the most significant challenge.

In the Welsh Government's 2017 economic action plan, there was a commitment to review regulation but the Institute of Welsh Affairs has noted it is not clear what action has been taken to fulfil this commitment. I'd be grateful to the Minister if he could outline what assistance is in place for SMEs and local businesses who are trying to navigate regulation and procurement processes, and have any reviews taken place since the 2017 economic action plan, and as well, what is the Welsh Government doing to prioritise locally owned businesses over profit-exporting corporations as the foundation of our economy, and how are they campaigning for consumers to do the same?

Okay, so the lead Minister with the responsibility for procurement is the finance Minister, but we are already reviewing with a group of Ministers including myself and others how we further benefit local supply chains when it comes to procurement, and small and medium enterprises are a key factor, in our minds, to do so. So, that work is in hand as well as the guidance note that Rebecca Evans authorised and introduced within the last Senedd term.

When we look at the foundational economy or the everyday economy, I was pleased to see my old Labour comrade and colleague Rachel Reeves talk about this in her speech in Brighton, talking about the everyday economy and its importance and what that means, because we have recognised that both with the foundational economy challenge fund but also the work that I'm now taking forward. And when you see the work that I've been talking about and mentioned with Paul Davies about what the future of our economic mission will be, the foundational economy will still be a significant part of that. And I am now on a slightly different side of some of the work that's already been started. When I was in Eluned Morgan's shoes—without the same heel, but in her shoes—as the health Minister, we were already then talking about the work that we could do and what it meant for procurement and smaller firms and the national health service. That work continues and we have agreed for promo work to be done between our two departments to get more value for local economies. This is about building this in as a normal way of doing business to see benefits being generated in every part of our economy, and not simply driven by price, but a much greater question of value.

And of course the Bevan Foundation has also promoted the benefits of a foundational economy for Welsh workers and businesses. The previous deputy economy Minister, Lee Waters, acknowledged issues of fair work, low pay, and lack of employee organisation in the foundational economy back in 2019, and a report from the Bevan Foundation in June 2021 still highlights how these issues are widespread in the foundational economy. The foundation's report was conducted as well in partnership with the Welsh TUC, and there were a number of recommendations that sought to tackle some of these poor workplace practices in the Bevan Foundation's report. So, I would be interested to know what has the Government done during this time to ensure employee rights, pay, and organisation in the foundational economy are supported in their plans, and does the Welsh Government have any intentions to implement the recommendations of the Bevan Foundation and Welsh TUC report, for example implementing the Fair Work Commission's recommendations in full and resolving some of the issues that the previous Minister in post highlighted back in 2019?

You'll see our ambition to be a fair work nation has been taken forward in a number of areas, not just in the social partnership and procurement Bill and what that will mean, but also in the work that we're leading on in this department in taking forward the economic contract. And the next stage will be really important about looking to further develop what we do and at the same time as saying, 'This is what we expect for businesses that have support from the Welsh Government', it will also then be about wanting to have good examples of where that already exists, because some of this is about showing it can be possible and it can be done and businesses can still turn a profit. And that's important because all the business groups that we talk with and work with are not hostile to this agenda; they want clarity in what is possible and what the expectations are, and they then think they can run successful businesses within the rules. So, I'm optimistic about their really positive engagement with us, and I think you'll see within this term more steps taken forward, so Wales really does become a fair work nation.