3. Statement by the Minister for Economy: The Foundational Economy

Part of the debate – in the Senedd at 3:00 pm on 9 November 2021.

Alert me about debates like this

Photo of Vaughan Gething Vaughan Gething Labour 3:00, 9 November 2021

A critical cog of the foundational economy is social care. It enables so many people to live fulfilled lives, whether they are the recipients of care, or relatives and close friends of those receiving care, as well of course as the significant number of people who work in the sector. The sector is facing unprecedented resource pressure, so we're channelling assistance to try to help address this challenge.

Social Care Wales is being supported to help tackle the current recruitment crisis. We have a focused national programme that is helping care providers to reduce recruitment costs, and return-to-work opportunities are being offered to both those furthest away from employment and those facing unexpected life changes, such as redundancy.

We're supporting Flintshire council to become the first council in Wales to directly commission care from microcarers. Recruiting microcarers in outlying villages could help to build rural economies and offer more local solutions, it can also reduce travel requirements and associated carbon emissions, as well of course as supporting the Welsh language. It could help to encourage growth of Welsh-owned businesses, and it is an approach that we will look to promote across Wales.

We are also helping the retail sector to respond to changed shopping habits by providing access to an electronic platform to help enhance the digital presence of smaller retailers and also to help identify opportunities again for reducing the carbon impact. This development is being introduced initially across three local authorities, and I do then expect that to be followed by an all-Wales roll-out.

The pandemic and the ongoing impact of Brexit have emphasised the importance of resilient, local food supply chains. Food is critical within the foundational economy and can help to deliver multiple benefits, providing opportunities for local food suppliers and producers, as well as enhancing health and well-being. It can also play a major role in helping to realise our net-zero ambitions. We've continued to support work to help build local food-producing capacity. Hywel Dda health board has been funded to explore the development of a freeze-cook facility targeted at local food producers.

We're also supporting controlled environment agriculture production. This should help to improve our capacity for year-round crops and will help small businesses to compete fairly to supply food locally, at the same time as contributing to the growth of our green economy. I am determined that we will increase the amount of Welsh food served on public plates. We're working with a range of partners to enable this, including Caerphilly council, who lead on the food frameworks for the Welsh public sector, and we continue to work with major food wholesalers and suppliers to help them to transition to increased Welsh supply.

To successfully and collectively nurture the foundational economy, we must acknowledge the wider benefits that come from local purchasing. This includes supporting fair work, strengthening communities and reducing our carbon impact, as well as improving well-being. Public procurement is worth approximately £7 billion each year in Wales. I am determined that we'll push forward initiatives that ensure that our public money is spent here and to champion a wider recognition of the role that the foundational economy plays in helping to sustain and strengthen our unique ways of life.

I'm pleased to outline that, through support allocated for an NHS Wales foundational economy procurement programme, Welsh suppliers have been able to win an additional £11 million-worth of healthcare contracts from April to October within this year. Social value is now a mandatory criterion in many NHS contracts and we will work with partners to mainstream this further.

We have visibility of NHS Wales's forward contract plan for the next two years and local government has produced a progressive, collaborative contracting pipeline. So, we will work closely together to clarify contract opportunities for the foundational economy and the business support that will give our local suppliers every opportunity of winning these contracts. We'll encourage the involvement of co-operatives, social enterprises and other employee-owned businesses in the delivery of public spending.

Improved visibility of future contract opportunities tackles a significant barrier, which has traditionally limited the chance of local suppliers successfully accessing public procurement. Other requirements, including accreditation and qualifications, can also limit the chances of local businesses in winning contracts. To help address this, I can confirm that I will launch a backing local firms fund this month; it will initially provide support to businesses in the food, social care and optimised retrofit sectors. The £1 million backing local firms fund will build on the success of the challenge fund. As well as accreditation and qualifications, the fund will promote the broad range of career opportunities that these sectors offer. This can appeal to all parts of our rich and diverse population.

Deputy Llywydd, we have achieved some encouraging progress. There remains great scope to accelerate growth in the foundational economy and to fully engage those businesses in our ambitions to deliver programmes such as the optimised retrofit programme, the manufacturing action plan and to help achieve net zero. Realising the potential of the foundational economy requires joined-up working across Government, with business, the wider public sector and our social partners.

In the coming months, I will continue to work with Cabinet colleagues to build on cross-portfolio collaboration that has already been established and to develop approaches that further underline our recognition of the vital contribution that the foundational economy makes to well-being here in Wales.