3. Questions to the Minister for Economy – in the Senedd at 2:41 pm on 31 January 2023.
I now call on the party spokespeople to question the Minister. First, the Conservatives' spokesperson, Paul Davies.
Diolch, Dirprwy Lywydd. Minister, at the start of this month, you announced that you'd be launching a refreshed manufacturing action plan setting out the Welsh Government's ambitions for the manufacturing sector. Can you confirm when that action plan will be published?
I'm having a range of stakeholder engagements within the next couple of months with businesses in the area. We've undertaken a review of the previous manufacturing action plan. We've shared a consultation with businesses around that. I look forward to taking part directly with business representatives over the next two months. Then, I will be more than happy to launch that and take questions from Members, either in this place or, indeed, in the committee that the Member chairs.
It seems to me that the Minister doesn't know when he is going to launch this refresh, but I hope very much that it will be very, very soon.
A key part of the current manufacturing action plan is building supply chain resilience. Of course, the Welsh Government could use the levers it has to reform the planning system in order to strengthen and develop our supply chain. One of the points highlighted in the current plan is to ensure the needs of manufacturing are taken into account when planning the delivery of business premises, for example. So, can you tell us whether the Welsh Government has met this objective, and can you also tell us what further action you intend to take to reform the planning system in order to support business development in Wales?
There are two things, I would say. The first is that I've given an indication of where we are in refreshing the plan, and it's not very far away at all. The idea that I don't have any idea is a misrepresentation—I'm sure, innocently—of the answer that I gave the Member. Actually, this morning, I was able to visit a manufacturing business in Pontypool with the leader of Torfaen, who was celebrating his birthday today. He had the privilege of spending some time with me in doing so in my colleague the Member for Torfaen's constituency. We were looking there at a successful manufacturing business, nearly 10 years in operation, what it's done to improve what it's doing and how it's actually worked with the local authority as well as the Welsh Government to go through a range of planning conditions to improve its business environment. You'll know that I'm not the planning Minister, but it is something that we do consider. The way that 'Planning Policy Wales' interacts with the manufacturing strategy and a range of other things are key considerations for us. So, when we launch the manufacturing action plan, you can expect us to have taken account of all those interactions. But I won't pretend for the purposes of these questions that I'm also the planning Minister, as the Member knows I'm not.
As I said, I look forward to that refresh as soon as possible. Minister, it's crucial that the Welsh Government is using the levers that it has to help support our manufacturing sector, and a refresh of that action plan, of course, is a welcome start. Earlier this month, Steve Dalton, the former managing director of Bridgend's Sony factory, rightly said that there was a future for Welsh manufacturing if there was innovation, development of green technologies and a focus on global markets. Of course, key to that is skills development and investment in research and development. The current plan states that a more co-ordinated approach is needed to help produce a pipeline of talent, and regional skills partnerships should be playing an important role in ensuring that Wales is developing the skills base it needs for the future. Therefore, moving forward, Minister, can you tell us how the Welsh Government's draft budget prioritises manufacturing, by confirming that there will be additional resources to support the sector? And can you tell us what specific actions the Welsh Government has introduced to ensure that the sector has the skills it needs for the future?
Well, there are a number of things that I agree with the Member on, but there's also a point of contest between us about the environment that we're operating in, of course. So, I agree—innovation and global markets are key to the success of a range of manufacturing businesses. I was with the Member for Ogmore at the Sony site in Pencoed last week, looking at—. They're celebrating 50 years, and they appreciate the relationship they've had with the Welsh Government, and the change in that plant's operation over time, not just for the Sony operation to continue, but it's about the other businesses that are on that site too. And, in fact, when it comes to exports from Wales, we've now reached and gone past the level of exports we had before the pandemic—the first part of the UK to recover in those terms. So, actually, we're doing relatively well compared to other parts of the UK.
The challenge is that the environment we're in has changed significantly, and you will have seen and, no doubt, be concerned about the International Monetary Fund's latest forecast about the UK economy. The fact that we're in a different position within the UK to the rest of the G7, that's part of the challenge that we face. The challenge that's specifically here in Wales, of course—and you mentioned skills partnerships and the need to invest in skills and innovation—is that our funds have been deliberately denuded. The way that the UK Government made choices around replacement EU funds, knowing full well how we use those to support and invest in the skills of workforces, has made a real difference. That money has been reduced and it's been changed to a different purpose in a different area of articulation by the UK Government. Now, that reduction in money has a real-terms consequence. And you will have seen in the draft budget that we can't fill in all the holes about the UK Government making those choices, and, again, it's a deliberate reach and assault into devolution. These are areas that are plainly devolved, but the UK Government are making alternative choices. The Member may not like hearing it, but it's the truth of the matter, and, if you talked with and listened to what businesses, the higher education sector and others are saying, they all recognise that too.
Plaid Cymru spokesperson, Heledd Fychan.
Diolch, Dirprwy Lywydd. Deputy Minister, an Institute of Welsh Affairs report published last year described communities in Wales as the least empowered in Britain. It further stated that people are facing an arduous and demoralising process to save assets, such as leisure centres, libraries and land, and that it is extremely likely that libraries and land have been lost due to Welsh Ministers not empowering communities. As you will be aware, local authorities across Wales have been consulting on their budget proposals for the next financial year, and amongst proposals are changes or cuts to leisure centres, libraries and museums. What discussions have there been between Welsh Government and local authorities regarding the future of such services? And what support is being made available to ensure that these vital services are not lost? Some of these cuts are imminent, from 1 April, therefore time is of the essence.
I'm very well aware of the pressures on many of our local authorities and public bodies. We have done whatever we can to support both national institutions and the local authorities. The local authorities, as you know, have had the best financial settlement in a long time, and much higher than they had anticipated, and how they utilise that budget is a matter for them. They have their own democratic mandates and they have to make those decisions. I hope that the decisions that they come to, following their deliberations and their consultations, will be that they take things like leisure centres and museums in the whole and that they realise that they are part of the wider well-being agenda for their population. I think you have to look at that in a holistic way rather than on a piece-by-piece basis, but certainly we have provided for individual organisations—libraries, National Museum Wales, the National Library of Wales and so on—additional funding to get them through this immediate crisis, and, as I say, with the local authorities and their increased budgets, I hope that they will be able to do something. But one of the things that I am concerned about, and remain concerned about, is the UK Government's relief scheme that has still excluded swimming pools, for instance, from their proposals, and we do continue to press the UK Government to utilise their powers to support swimming pools, which are probably the hardest hit, and potentially the hardest hit in this process.
Thank you, Deputy Minister. But we know that councils will be cutting these vital services—services that, as you outline, are rightly incredibly important in terms of the future generations Act, health and well-being and so on. We know that these cuts are coming from 1 April unless something drastically changes. We know that financial settlement hasn't been adequate to ensure that those non-statutory services are protected. Therefore, my question is: what is Welsh Government doing to support local authorities? I know it's democratically up to them, but the choices they're having to make are incredible difficult. So, what support is being provided? You referenced swimming pools, for instance, and we saw over the weekend Fergus Feeney of Swim Wales warning that nearly a third of the 500 public swimming pools in Wales could close. And they are asking as well—yes, of course, the levers are with the UK Government—for action from the Welsh Government as well. So, as Deputy Minister with responsibility for sports, which would include swimming, what are you doing to ensure that that’s not the case?
First, I think I have to go back to my original point and a point that you have acknowledged: local authorities have their own democratic mandate. We can’t direct local authorities to do what they want to do with money that they have within their rate support grant. They will have to make their own decisions and make their own priorities. We can’t direct them in that area. What we have done is we have provided local authorities with a substantial uplift in their rate support grant and we have given as much as we can within our constraints. I think you’re coming from a point that somehow we have a pot of money that we can just dip into and allocate that we haven’t already allocated, and I think the finance Minister and the First Minister have explained time and time again on the floor of this Chamber how we have prioritised health and we have prioritised local government. Those two services in particular have had the highest settlements that we’ve been able to provide, and, within those settlements, those bodies have to make their spending decisions, particularly local authorities that have their own democratic mandate. And of course those choices are difficult; those choices are also difficult for Welsh Government in terms of where we allocate our resources. There are no easy choices. I have met with Swim Wales and I have rehearsed the arguments with Swim Wales. They understand the Welsh Government’s position, and of course they’re calling for more money, as every organisation that we help and that we fund and that we support is asking for more money. But we can only provide the funding that we can within the envelope that is available to us, and I hope that local authorities and leisure organisations will be able to make the best decisions that they can to protect as many of our leisure facilities as possible.