Questions now from the party spokespeople. The Conservative spokesperson, Peter Fox.

Diolch, Llywydd, and good afternoon, Minister. Minister, the recent emergence of the omicron variant has unfortunately created more uncertainty for all of us. And whilst I sincerely hope that this isn't the case, potentially there are a difficult few months ahead. Understandably, governments and scientists are trying to understand the implications of the variant on public health, but talk of looming restrictions is creating a lot of anxiety amongst businesses at a time when many were hoping to use the Christmas period to make up for some of their lost income over the past two years. This period is particularly important for our hospitality sector and the jobs that this additional demand supports. We have already seen that this uncertainty and anxiety is already starting to have an adverse effect—bars and restaurants have been hit by a wave of cancellations in recent weeks, whilst our vital tourism businesses are also fearing the impact of restrictions.

The First Minister said yesterday that if—. Oh, excuse me—iPad. The First Minister said yesterday that if further restrictions are required over the coming weeks, the Welsh Government would consider providing additional business support over and above what might be provided by the UK Government Minister. Could you outline what this support may look like, to help ease any concerns that businesses may currently have about the future? Also, businesses urgently need priority on the future of non-domestic rate relief, with many facing a cliff-edge return to 100 per cent liability in April 2022. Minister, I'm sure you're considering extending the NDR holiday to help businesses through the latter part of the pandemic. Will this be included in your upcoming budget? Could you also provide assurances to businesses that a transitional approach will be taken when any future support scheme eventually comes to an end?

I thank Peter Fox for those questions, and I particularly would recognise everything that he said about the importance of this time of the year to those businesses, particularly in the retail and hospitality sectors. I just want to reassure Peter Fox that I have been having discussions with the First Minister and with my colleague the Minister for Economy in terms of what support may be necessary to provide to business in recognition of the impact that the coronavirus pandemic continues to have on businesses here in Wales. I'm not in a position, unfortunately, to outline the specific package of funding that we might be looking at at this point; I just want to reassure you that those discussions are actively ongoing at the moment with colleagues. I have had the opportunity to hear directly from the Federation of Small Businesses, at one of our recent partnership meetings, and they were very clear in the need to support business. I also had the opportunity to meet the Welsh Retail Consortium when I was preparing for the budget. So, I've had really good opportunities to hear directly the concerns of business.

And, of course, non-domestic rates were very much a part of those conversations, and, again, just to provide reassurance to Peter Fox and those in the business sector, I will have more to say in this regard in the budget, which we'll be publishing on Monday. So, there's not too much longer to wait for that, but I am really proud of what we've been able to achieve through our support via business rates here in Wales, because, of course, across the border, those businesses in retail, hospitality and leisure were starting to pay their rates in the summer of this year, whereas our businesses here have had a whole year's relief, which I think has been really excellent and, of course, helps us in this particularly challenging time of the year. 

I thank you for those responses, and it sounds like there might be some positive news. I'm sure I'm not going to get too much out of you in regard to the budget, but I will try. So, thank you for that response. 

Of course, it's not just the economy that is facing an uncertain time, but our health and social care sectors too. There are already huge amounts of pressure as we all know. We only have to look at the current waiting times for treatment, which have increased substantially during the pandemic. And whilst services are doing their very best to respond to the challenges, and I don't doubt the scale of the task ahead, the new variant is only going to add to their workload. One way of helping to free up capacity in health services is to ensure that people needing social care can access the support that they need within the community or specialist services. However, as we've all heard over the past few months, there is a significant backlog within the sector, with an unacceptable number of people waiting to be moved out of the hospital to home or into a community care facility. Whilst councils and their staff have done a fantastic job in dealing with the impact of the pandemic, it's clear that they will need more support over the coming months. Many are already facing huge overspends in adult and children's services, and this will only add to the financial pressures facing our vital front-line services. Minister, will you provide councils with the sufficient uplift they need in the local government settlement so that they can respond to current and future pressures, and how will the budget allocate the substantial consequential funding that is flowing to Wales as a result of recent announcements about social care elsewhere in the UK? 

Furthermore, we also need a long-term, ambitious plan to ensure parity between health and social care so we don't find ourselves in this situation again and to improve recruitment and retention rates. To steer us in the right direction, the Welsh Conservatives have called for all social care workers to be paid a minimum of £10 an hour, and I hope that Plaid's position remains the same in that regard. Minister, how will your budget start addressing the mismatch between social care and health in Wales?

Thank you for raising this important issue. I'll begin by referring to our in-year position in terms of the additional support that we've provided to local authorities in respect of the coronavirus pandemic and the huge pressures it's placing on social care in particular. You'll be familiar with the £42 million social care pressures funding that we've provided, in addition to the social care recovery fund of a further £40 million allocated to local authorities, to help the sector meet the ongoing pressures. However, Peter Fox did refer to the ongoing issues in regard to children's services and adult social care, and also the need to add to that to support carers. I just want to reassure Peter Fox that my officials are in discussion with the treasurers of local government to understand the sum of that pressure, but I intend to write imminently to the leader of the WLGA to set out the envelope of further funding to support local authorities in that regard in this financial year.

Looking ahead to the budget, which will be published on Monday, and not wanting to say too much more in detail, I would just set out what we've set out all along, which is that social care and health will be priorities alongside the wider local government pressures in terms of the budget, which we will be publishing on Monday—so, not too much longer now before we get to share the detail of those plans with you.

Thanks for that, again, Minister. I think the overspend that local authorities are facing with children and adult care is around £50 million at the moment.

Moving on to my last point, Minister, the uncertain times that we again face will only exacerbate the issues that families across Wales are already facing. Now, I know this is an issue that spans across Government, but I would like to focus on what additional support will be in next week's budget that will help to ease the burdens facing families. There were some broadly welcome things in the co-operation agreement, for example, the commitment to expand childcare to two-year-olds, which was also in the Welsh Conservative manifesto. However, the time for words is over, and now we need to see immediate action. Will your budget provide the funding necessary to kick start the expansion of this free childcare to help families over the coming months? However, the agreement was, unfortunately, a little light on detail in places, so we need to see a wider package of support for people and families.

A way to help people's finances is to deliver a council tax freeze, for at least the next two years, putting more money into people's pockets. Will the Welsh Government use some of the substantial expected additional funding to provide local authorities with the capacity to meet cost pressures and to freeze council tax? In addition, house prices in Wales have risen faster than in any other part of the UK. We need to do more to help people onto the housing ladder, as well as building the high-quality social homes we desperately need in Wales, enabling aspiration and providing people with the security that they need. Will you work to cut land transaction tax rates, scrapping it for first-time buyers and raising the threshold to £250,000? And will you provide a longer term funding settlement to the housing support grant to kick start social home building? Finally, can you also commit to ensuring that there will be no rise in Welsh rates of income tax for the duration of the Senedd term, as part of your spending plans? Thank you, Minister.

Thank you to Peter Fox for that series of questions, all of which will become clear when the budget is published on Monday. But I do want to respond to some of those issues, particularly around the co-operation agreement. We've worked very carefully and closely with Plaid Cymru to ensure that those items within the co-operation agreement are funded, and that they are deliverable. So, we've been very careful in that kind of forensic work to ensure that the co-operation agreement is deliverable and is seamless, really, with our overall budget.

And, then, I think, I need to put the budget for next year within some kind of context, because, yes, we have had a significant uplift in the first year of the three-year spending review, but then the next two years are very, very tight after that. And, I think that we need to see that initial first-year uplift within context, because it's only a large increase if you actually split out all of the COVID funding that we've had for this financial year. If you take away all the additional COVID funding we've had this year, our budget next year is actually lower than this year, and I think that we need to bear that in mind, given the fact that COVID isn't going away and we're seeing that very much reflected in the challenges now that we're facing with the new strain, the new variant. I do think that context is everything, really, for the budget. But I hope that colleagues will be pleased with what they see that I'm able to provide when it is laid on Monday. Thank you.

Plaid Cymru spokesperson, Llyr Gruffydd. 

Thank you very much, Llywydd. Yes, omicron is casting a long shadow over Wales this Christmas, and although we can't predict exactly what the implications of the variant will be for the NHS and for public health, we are already seeing its impact, for example, on the hospitality sector, as you recognised earlier. So, to expand on your previous response, can you explain why you, as finance Minister, don't intend to release more funding to support the hospitality sector now? Because the impact on those businesses is being felt now, as we speak. Saying, 'Well, wait until I publish my budget on Monday' doesn't solve the problem, because those are expenditure commitments from April onwards.

Absolutely. Apologies if I wasn't clear. We are currently thinking, today, about what additional funding might be necessary for businesses to support them through this immediate period ahead. So, prior to coming to this session, my most recent meeting was with the First Minister, talking about what support businesses might need, and then we've got further discussions planned with the Minister for Economy. So, these are really live discussions and I recognise the urgency of it. That's separate, I think, to the budget, which will be published next Monday, which then looks ahead from April onwards. But just to provide that reassurance that these discussions in respect of business support are very much live at the moment.

Well, thank you for that reassurance. I think each and every one of us hopes that we can provide the necessary support as soon as possible.

But we all, of course, remember how the Westminster Government ignored Wales's request to extend furlough payments when we entered the firebreak last year, and it was only after England went into a firebreak that they actually provided that support to us here in Wales as a result of that. Now, we could, of course, be facing a similar situation over the next few months. So, can I ask you what discussions you as Minister have had with the UK Government in order to ensure that the residents of Wales aren't punished and don't miss out on support from the Treasury in London if we were to take steps here that are different to those that the Conservative Government in England may take?

Yes, absolutely. So, I think it would be absolutely unacceptable if we found ourselves in a position, as we were when we introduced the firebreak previously in the pandemic, where the UK Government didn’t provide additional financial support, but as soon as it needed to take similar measures, all of a sudden furlough was there and available. That situation is absolutely unacceptable. We don’t know where this pandemic will take us and what measures might be necessary over the months ahead, so I think that having a clear framework with the UK Government as to when funding should be available and under what circumstances is vital.

You’ll be aware that the First Minister wrote, alongside the First Minister of Scotland, to the UK Government on precisely this issue. My understanding is they haven’t yet had a response, so I’ve written this morning, again, to the Chief Secretary of the Treasury, outlining that particular issue and the need for assurances there. But then, also, raising the issue of a COVID guarantee again, because in the last financial year, we negotiated a COVID guarantee, which gave us a global sum for COVID expenditure, which allowed us to plan, allowed us to make the most of opportunities, and allowed us to understand the risks that we were facing, because we knew that overall sum that we would receive. Even though it kept changing throughout the year, it was at least a good start. So, we’re asking for that to be reinstated in light of the current situation, and I hope it’s something that the UK Government will agree to, because it seems just a reasonable flexibility that they would be able to provide us with.

But it's not just rejecting furlough when Wales really needed it that worries me, Minister; the arbitrary way in which the Conservatives treat Wales in other areas of funding is also apparent. The HS2 scandal and the rejection of billions of pounds that should come to Wales—money that Scotland and Northern Ireland are receiving, of course—is another example, as is the way they've broken their word on European funding, with the loss of hundreds of millions of pounds that would have come to Wales, but is now being pocketed by Westminster. There is no strategic focus to the shared prosperity fund—again, something that operates according to the whim of the Chancellor in Downing Street. And there's a pattern here, isn't there? A pattern that is being reflected across the Westminster Government.

Now, I know that you're as frustrated as I am because of the transformational impact that this funding would have if we were to receive it, but can I ask, therefore: what more can you as a Government do and can we as a Senedd do in order to ensure that Wales receives the money owed to us, and that we are treated more fairly by the Westminster Government?

I think that the Senedd is always at its best when we find areas where we can all agree on and, previously, we have been able to find some cross-party and cross-Senedd support for various issues when we’ve needed to press the Treasury, and certainly within the context Brexit. So, I think there’s a lot we can do together to press these points about fairness, about ensuring that the statement of funding policy is more than just a document, that it actually is brought to life and is stuck to. So, we’re trying to work through that with Treasury.

I think that any efforts that UK Government can make to ensure that the new inter-governmental relations structure works would be important. And the finest place that they can do that, and the most important, would be through the finance structures. So, all of those points that you’ve described—HS2, European funding and so on—will be important. We can go on and talk about coal tips funding, for example. Even though we made really strong arguments, supported by Welsh society more widely, about the fact that coal tip funding should come from the UK Government as it predates devolution—all of those arguments were well made—that wasn’t the case and, of course, now you’ll have to see how we reflect funding for coal tips in the budget next week. But when we look at that, remember that that’s funding that we can’t be spending on infrastructure in areas for which we believe we are genuinely responsible. So, I couldn't really disagree with anything that Llyr Gruffydd has set out in his question there. And, if we can find ways to work together to put that pressure on the UK Government to do the right thing, then I'm always happy to look for ways to do that.