Questions now from party spokespeople. The Conservatives spokesperson, Peter Fox.  

Diolch, Llywydd. Good afternoon, Minister. Minister, do you agree with the First Minister's previous claim that Plaid Cymru believes in voodoo economics and has a habit, and I quote again, of

'promising people things that I know are simply not possible'?

Llywydd, I'm not going to mediate between the Conservatives and Plaid Cymru on the floor of the Senedd. I will leave that to them to have those discussions themselves.

I've mentioned this, Minister, given that Welsh Labour, your Government and Plaid are currently negotiating a co-operation agreement. Yet, Minister, we still do not know what is in the agreement. What will it mean for the Welsh Government's budget in December? All we have had so far is a vaguely worded Welsh Government statement published last month, and I don't think that's acceptable. And as a responsible opposition, we need to have the opportunity to scrutinise this deal and to look into what it will mean for the hard-working Welsh taxpayers. After all, it is taxpayers that will ultimately foot the bill for this deal. Plaid's manifesto shopping list included, as we know, full devolution of justice, which the Silk commission estimated would cost about £100 million, and they were also talking about borrowing £4 billion from the private sector to fund various policy commitments. Just let that sink in for a moment.

So, will these policies tackle the most pressing issues of the day? No. Will these policies create jobs? No. Will these policies help Wales bounce back post COVID? No. These commitments will instead handcuff the financial recovery that we need. Such eye-watering sums of money risk saddling future generations with unsustainable levels of debt. This will not create jobs, support public services or help Wales's financial recovery from the pandemic. So, Minister, in the spirit of accountability and scrutiny, will you outline what commitments from the Labour-Plaid agreement will feature in the upcoming budget, and how will these be funded?

Llywydd, I do try to be as helpful as I possibly can be in questions, but I'm not going to be drawn into any commentary on discussions that may be taking place between my party and Plaid Cymru. I don't think this is an appropriate time to do that. 

That said, I think that there are important things that the Conservatives can be bringing to this discussion in terms of what's good for people in Wales. We have a perfect opportunity on 27 October for the Conservatives to really demonstrate their commitment to Wales and to give that better future that you've just suggested that you wanted. One way they could do that, of course, would be funding the coal tip remediation in Wales. Let's remember that's £500 million to £600 million over the course over the next 10 years, which, if the UK Government doesn't fund it, and Barnett never was intended for this purpose, then that's funding that we'll have to divert away from other things, such as building social housing, investing in schools and hospitals, and in road maintenance and so on. On 27 October, they can address the historical underfunding in rail that we've just discussed in response to Jayne Bryant's question, and can address that dearth of EU funding that we've addressed in another previous question this afternoon, and, more broadly, provide that certainty that we won't be returning to austerity. So, I think that Welsh Government is keen to work with all of those who share our ambition for a fairer, greener and more equal Wales, but I do think that the Conservatives have a chance to influence their own Government at this important point. 

Well, I can't thank you for that, Minister; I think you've ducked the question. It's a legitimate question from a party that is supposed to hold the Government to account. The Welsh Government's upcoming budget is one of the most significant that we will see in this place, and given the impact that the pandemic has had on people across Wales, this needs to be a budget that is focused on not just recovery, but one which is focused on aspiration.

But the deal that your party is proposing to do with Plaid risks taking more money out of the pockets of our people. Plaid's manifesto included a number of potential stealth taxes, such as a junk food tax, a tax on drivers, a tourism tax, which has been mentioned and would have dire consequences for the hospitality sector in Wales. Of course, Welsh Government are also looking into the potential of a road tax and tourism tax—a double whammy for families across the country. Ultimately, we need an ambitious plan that embraces the future and puts an end to this dark COVID chapter we've all lived through. So, Minister, can you confirm that it is not your intention to introduce any new taxes in your upcoming budget, and can you outline whether your agreement with Plaid includes a specific agreement on the reform of council tax? Put simply, what will your co-operation agreement mean for the hard-working families of Wales? Thank you.

Llywydd, I'll be publishing the Welsh Government's draft budget and departmental budgets on 20 December, and there will be ample opportunity for colleagues to scrutinise the draft budget following that.

Plaid Cymru spokesperson, Llyr Gruffydd.

Diolch yn fawr iawn, Llywydd. It's quite sweet, isn't it, to hear the whingeing from Conservative benches about Plaid Cymru tax policies when they can't even keep their promises when it comes to taxation on a UK level. And it really is a graphic illustration, I think, of the jealous irrelevance of the Members who are allegedly the official opposition—and an official opposition who can't even muster their Members to vote when the time comes.

Now then, Minister, if we can discuss some of the issues that are of real interest to the people of Wales—there are huge challenges facing a number of businesses in Wales at the moment, who are having to cope with a substantial increase in energy costs. And that's having a particular impact on businesses that are intensive users of energy. We are aware of negotiations happening at a UK Government level. Can you tell us what discussions are happening within the Welsh Government, with you as finance Minister, to look at the possibility of providing additional support to those businesses in Wales affected by this?

Well, the Minister for Climate Change has written to the UK Government, to urge them to take all possible action to protect people and businesses at this point. And I know that she received a briefing from Ofgem on 21 September, where she sought assurances on the part of consumers. In terms of businesses, clearly, we are concerned about the impact of the increase of energy costs, as we are in terms of the impact on public services as well. Ultimately, the UK Government does need to step in to this place, because this is the kind of area where it does need the fire power that the UK Government has, which we don't have. Beyond that, I'm having further discussions about support for businesses for the remainder of the financial year, through the additional funding that we have in respect of COVID, which is yet to be allocated, although I don't want to suggest that that's necessarily tied to energy, but I just want to reassure that additional support for business is being discussed at the moment.

Well thank you for that. You've made the point for us, I think, that the UK Government has powers that we don't have in this place to respond to this. And once again, exceptional circumstances, as we're facing at the moment, show how few powers and macroeconomic levers we have here in Wales to be able to respond to different crises. We saw elements of that with regard to the pandemic. The Institute for Fiscal Studies said that devolved governments had been held back in their fiscal response to the pandemic by insufficient reserved funds, by limited borrowing powers, and so on. Now, your argument as a Government debate last week took us in that direction as well, regarding the failures and deficiencies of the current settlement in the fiscal context. So, in the light of all of this, do you acknowledge that the current settlement is insufficient, that we need to renegotiate the fiscal framework, and to do that to strengthen, of course, the fiscal powers that we have here in Wales, to empower us to respond better to situations as they arise?

Yes, I do agree that the fiscal framework and the statement of funding policy, which sits alongside that, do need to be revisited, and particularly so in relation to fiscal flexibilities. I have the opportunity tomorrow, at a finance Ministers' quadrilateral, to make exactly that point, alongside Ministers from Northern Ireland and Scotland, who share our concern that we should be able to carry funding over for a 12-month period, for example, when we get late additional consequential funding announced in the year. We should have the ability to draw more down from the Wales reserve, and we should have the ability to have greater borrowing powers. And those are some examples of the additional flexibilities that would be useful purely for good budget management, if nothing else. So, those discussions will be ongoing with the new Chief Secretary to the Treasury tomorrow. When we previously discussed it with the previous Chief Secretary, it was agreed that this would be an ongoing discussion. So, I do hope that we're able to make some progress.

Thank you very much. And of course, in the meantime, it's important that this Government does turn over every stone in order to create the revival that we all want to see. The Federation of Small Businesses, for example, is proposing a package of possible measures that would contribute to that, through using procurement. They also talk about encouraging more start-ups, and including the employment levy, and so on. But procurement, certainly, that you do already have as a Government here in Wales, could have that transformative impact that I'm sure that we all want to see with regard to the economy. Now, we've all argued that we need to increase how much public procurement funding stays in Wales from around the current 52 per cent. We as a party have said that we would want to aim towards 70 per cent, and of course, with every 1 per cent in addition, that means 2,000 jobs, so an increase of 20 per cent would mean an increase of 40,000 jobs, and that would be achieved without spending more money. That money is being spent already, but we'd be able to do that in a much smarter way. So, what are you going to do to achieve that potential and fulfil it, and will you commit to a target, as Plaid Cymru is aiming towards, to maximise the value of the Welsh pound, which would have such a positive impact on the economy and on people's lives?

I would commend the Sell2Wales dashboard to the Member and to all colleagues as an opportunity to have a really important snapshot of the situation in terms of procurement here in Wales. So, between July and September there were 1,078 contracts awarded to suppliers on that, and of those, 706 were awarded to Welsh suppliers. So, clearly we want to keep improving on those figures, and there are different ways to do that. One of the things I'm particularly interested in, and we've started off a piece of work on it, is better understanding the supply chain voids that we have here in Wales, where we can step into those areas where there's no logical reason why we're purchasing from elsewhere, and to create those jobs here in Wales.

Procurement is about even more than that, really. We're really focused on the social value and the environmental value of procurement. So, we recently published our new social value themes, outcomes and measures, which is an important intervention there, and we've also published a new Wales procurement statement, which sets out the kind of additional value that we want to see brought to our public procurement here in Wales. And we're also looking at our grants, because of course grants outweigh public procurement in many ways in terms of the funding that is allocated through those, so we're looking again at what social value we can be deriving from our grants here in Wales. But it's clearly an area where we both have a shared interest in ensuring that more of these contracts are won by businesses here in Wales.

I'd like to declare an interest at the outset, as I am a member of Rhondda Cynon Taf County Borough Council until May of next year.