7. Debate on the Economy, Trade, and Rural Affairs Committee Report — 'Cost of living pressures'

Part of the debate – in the Senedd at 4:20 pm on 16 November 2022.

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Photo of Paul Davies Paul Davies Conservative 4:20, 16 November 2022

Now, our report contains 27 recommendations in five areas. We focused on: the support that was available from the Welsh Government and the UK Government in May and June of this year, and where the gaps were; the pressures on households at that time; the pressure on the workforce; the impact on rural communities; and the pressure on businesses. I'm pleased that 23 of the recommendations were accepted, with the remaining four accepted in principle. There is a lot to welcome in the Welsh Government's response, and I thank the Minister for his positive engagement with our report and recommendations.

Our first five recommendations relate to ensuring that the Welsh Government is gathering enough data and the right kind of data to understand where the need is greatest and to ensure that the money available is being directed in the best possible way. We heard some concerning evidence about the scale of the challenge for people trying to access support, and so the fact that these five recommendations were all accepted is very welcome.

Our sixth recommendation was about maximising awareness and take-up of the benefit support out there for individuals, and Welsh Government's efforts in this regard are also welcomed. This includes the work being done through the 'Claim what's yours' campaign, and the income maximisation working group, which is referenced in response to our seventh recommendation. The committee would be grateful for any updates on this work from the Minister as we move through the winter period and into the spring of 2023, and perhaps in responding to this debate we'll hear a bit more about the work that has taken place.

I'd also like to pay tribute to those providing advice and support services to people who are feeling the pressures the most right now. Their work is not always fully recognised, and we heard the strain that they themselves are under as they try to support others in their community. Indeed, we're very grateful to a number of organisations that participated in focus groups and interviews run by the Senedd's citizen engagement team. The findings of that work are available on our website and reflected in our report.

Action in Caerau and Ely, ACE, was one of those grass-roots organisations supporting people on low incomes, and their evidence highlights a particularly important aspect of the inquiry. They made the very important point that it's only of any benefit if you know about it. Now, as well as raising awareness of what support is available, a key message from our inquiry was that more could be done to rationalise the process of applying for support. Dr Steffan Evans of the Bevan Foundation pointed out the vast amount of form filling that people are required to carry out just to get money they are entitled to, and he urged the Welsh Government to accelerate work in this area.

There is a consensus that the system needs to be more coherent, and recommendations 8, 9 and 10 call for better passporting of benefits, more co-ordination, and streamlining of services in a one-stop-shop approach. We welcome the Welsh Government's response on this point, and welcome the fact that a benefit charter is currently being developed. We also recognise that some local authorities are further ahead of the game, and we want this best practice to become the norm.

Recommendation 11 is particularly pertinent, as it refers to eligibility for support beyond means-tested benefits, and highlights the plight of those families who may be just missing out. It's vital that the Welsh Government recognises this in the criteria for its winter fuel support scheme, and I hope the Minister will take this recommendation into account with the design of future schemes.

I thank the Minister for the response to recommendation 12 on how the Welsh Government's discretionary homelessness prevention grant will help to mitigate the reduction in discretionary housing payments, and the committee notes that Ministers will continue dialogue with the UK Government on what funds will be available in the 2023-24 budget to tackle cost-of-living pressures.

Now, not all the committee's recommendations were accepted in full, and I am a little puzzled why our call for the Welsh Government to drive the accreditation of public sector employers as real living wage employers has only been accepted in principle. We also recommended that the Welsh Government should explore using its levers around public sector pay and conditions to increase fair work in Wales, including by improving sick pay, where this is needed for workers delivering public services, starting with longer term arrangements for social care workers, and supporting those with the lowest earnings via pay settlements. Nevertheless, I note that the Welsh Government's response points to the arm's-length work of Cynnal Cymru to promote the benefits of the real living wage for workers in Wales, which is particularly appropriate to recognise this week, as it's Living Wage Week.

It's also good to see, in response to recommendation 15, that the Minister and the committee are on the same page with initiatives to promote fair work. Likewise, with recommendation 16, our report highlights the importance of good labour market data to support the Welsh Government's policy response in the face of cost-of-living pressures on the Welsh economy.

Mental ill health is a huge concern in the face of these cost-of-living pressures, and the committee heard some very concerning evidence from the trade unions and grass-roots organisations about the impact that financial worries are having on people. Some of the comments that we've received through the committee's engagement work included things like, and I quote:

'I'm afraid to put the heating on',

'I feel sick and can't eat',

'We earn a good wage but can't cope with the bills', and, 'I'm a prisoner in my own home.' Therefore, encouraging employers to support their workers through these difficulties is critical, and so we rightly made a specific recommendation about this.

Dirprwy Lywydd, as I mentioned at the very start of my contribution, other Senedd committees have also done important work on cost-of-living issues. For example, the Equality and Social Justice Committee had already made important recommendations about fuel poverty and the Warm Homes programme in May, two months before the Economy, Trade, and Rural Affairs Committee report was indeed published. So, it's vital that Members recognise that this is one part of a large piece of work on scrutinising Government support to meet the rising cost of living.

Dirprwy Lywydd, another important focus of our report was on the struggles faced by off-grid households and those in rural communities, where there is a rural premium for accessing goods and services. We know there are multiple factors at play here: rurality, reliance on more expensive forms of heating fuel, increased costs of transportation, isolation, the pressures on our farming communities to meet soaring feed, fertiliser and fuel costs. Therefore, recommendations 19 to 23 cover measures to support off-grid households with fuel costs and the provision of warm hubs, which have been introduced now in Wales, and more research and analysis around the needs of rural communities. It's good to hear that rural issues are being given particular consideration for future iterations of the Warm Homes programme, and I look forward to hearing more about this work in due course.

Our last four recommendations are around support for business to cope with the increased costs of doing business. The Welsh Government pointed out that many levers sit at the UK level to provide additional financial firepower to meet the challenges, and that the Barnett consequentials used for COVID support in previous years are not there for 2022-23. I'm pleased that the Welsh Government accepted our recommendation about supporting Welsh businesses to become more energy efficient, and not to lose sight of net-zero targets in the face of the financial challenges.

Finally, with regard to ongoing non-domestic rate relief for businesses, we note the commitment to review the need for further transitional support in 2023, and the committee looks forward to hearing more about how the Welsh Government will be using business rates relief to support the most affected businesses in Wales at this very difficult time.

In closing, I'd like to repeat my thanks to everyone who engaged with the committee during our work on this important issue, and also thank the team who supported the committee to carry out this inquiry. I look forward to hearing Members' contributions to this very important debate. Diolch yn fawr iawn.