Y Cyfarfod Llawn - Y Bumed Senedd

Plenary - Fifth Senedd


The Assembly met at 13:30 with the Llywydd (Elin Jones) in the Chair.

1. 1. Questions to the First Minister

[R] signifies the Member has declared an interest. [W] signifies that the question was tabled in Welsh.

The first item on our agenda this afternoon is questions to the First Minister, and the first question is from Mike Hedges.

Tackling Scams

1. Will the First Minister make a statement on tackling scams in Wales? OAQ(5)0443(FM)

Scams can have a terrible effect on victims, and we are committed to making our communities safer through our funding of community support officers and through working with the police and crime commissioners.

Can I thank the First Minister for that response? I do not believe you can overestimate the problem with scams, both by phone and written. The effect on people being scammed is horrendous and can have a serious effect on their life, and actually, in some cases, it can lead to a shortening of their life. I appreciate the work done by trading standards and third sector organisations and others. There are devices to monitor and block phone calls, and there is a firm in Swansea in my constituency that actually makes them. Will the Welsh Government convene a conference of all interested parties to discuss what further can be done to reduce this problem? I don’t believe it can be solved, but at least can we try and reduce it?

The Member is quite right to point out that scams are increasingly more sophisticated, particularly those online, and we are working closely with trading standards on a variety of scams, dealing with a variety of scams, relating to counterfeit goods, and illicit and illegal tobacco. And, of course, there’s a growing focus on cyber crime, and we are committed to working with the police and police and crime commissioners on this issue. Should a conference be a productive use of that time, then we will look to do so despite our limited competence in the area.

One of the other things, First Minister, that can be done in order to combat scams is the establishment of no-cold-calling zones. This has been something that has been extremely successful in my own constituency, where Conwy County Borough Council have imposed a town-wide one in Abergele. What work do you think that we can do here in the National Assembly, and the Welsh Government can do, to make Wales the first no-cold-calling nation in Britain?

An interesting idea. We have, of course, provided funding to increase the number of no-cold-calling zones in Wales, which help to protect vulnerable people from scams, and I know, as the Member has pointed out, that most of the local authorities now in Wales do have no-cold-calling zones that look to reduce the number of cold callers. Of course, if we get to a point where all local authorities have no-cold-calling zones, then we can begin to consider the issue of whether we can declare ourselves a no-cold-calling nation.

Economic Development in South-east Wales

2. What plans does the First Minister have to encourage economic development in south-east Wales? OAQ(5)0451(FM)

We plan to continue to support businesses in their growth, to invest in high-quality infrastructure and to improve economic development conditions.

I thank the First Minister for that response. There has been good news on jobs recently, and I welcome the fact that British Biocell International Ltd is moving from Llanishen to Crumlin, staying in Wales and with an increase in numbers. But that does mean that these jobs are leaving Llanishen at the same time as there are plans for S4C to move to Central Square, Cardiff, and to Carmarthen, and also, at the same time as the tax offices are planning to move down to Central Square. So, there’s a huge exodus of jobs from one very small area in the constituency. So, I wondered if the First Minister had any suggestions about what strategies could be undertaken to ensure that that area does continue to be a mixed area, where there is the possibility of getting local jobs, because this is a big change to the job scene there.

Yes, I am aware that Cardiff’s local development plan seeks to deliver 40,000 jobs over the period to 2026. That includes mixed-use urban extension to the north-east of Cardiff, providing a range and choice of jobs, homes and supporting infrastructure to meet the needs of existing and future communities.

Today, the UK National Cyber Security Centre is being opened in London, and the First Minister will be aware of the excellent National Cyber Security Academy in Newport, a partnership between Welsh Government, the private sector and higher education. So, it’s very disappointing that the UK’s centre is going to be located in London, as if London hasn’t got enough support from the UK Government in that respect. So, what representations did the First Minister make to try and get the UK centre to locate alongside the cyber academy in Newport, so that our country could have benefited from the jobs that will come? And, looking further to the future, will the First Minister commit to designating Newport the cyber security capital of Wales so that we can, in future, leverage greater opportunities to that community?

An interesting idea again, and something, certainly, that I will look into. I will write to the Member in terms of what representations were made about the National Cyber Security Academy. It is an initiative, in principle, that we have supported, but I will write to him with further details in terms of how the centre was established and why it was established in London.

First Minister, as Cardiff continues to create jobs and attract very many visitors, we are seeing more and more congestion on the roads. I notice that there’s now a proposal to examine the feasibility of using the Taff and the bay as our main water arterial routes around the city—already popular for tourists, but it might have a commercial application as well in moving commuters. Is the Government prepared to look at this?

I did see that. It’s a matter, ultimately, of course, for Cardiff council, if I remember rightly, in terms of their management of the waterways. I know, in the summer, that the service is very, very successful; in the winter, less so. People tend to see the service more as a tourism service, rather than a commuting service. But we know there are examples elsewhere—not just in the UK, but around the world—where water bus services have been successful. And, certainly, I would want to look to work with the operators, with the city council and others to see whether such a service will be feasible in the future.

First Minister, you explained last week that, although the Welsh Revenue Authority is being created, nearly all of the staff are having to be recruited in London because we just don’t have the skilled people here in Wales, and this is a persistent problem. But it does rather beg the question of what your Government has been doing about skills and training over the last 17 years.

Well, the Welsh Revenue Authority was merely a twinkling in the eye 17 years ago. The issue is this: the function the revenue authority will perform has never been performed in Wales before. So, we shouldn’t be afraid of the fact that we do need to bring skills in from elsewhere to set up the authority and, ultimately, to train our own people in order that they are able to provide those skills in the future. But to criticise us for not having the foresight 17 years ago—up to 17 years ago—in terms of establishing an authority that no-one thought would ever be established at that point, I think is stretching things a bit too far.

Questions Without Notice from the Party Leaders

Questions now from the party leaders. The leader of Plaid Cymru, Leanne Wood.

Diolch, Lywydd. First Minister, do you support the aspiration to achieve a million Welsh speakers by 2050, and, if you do, can you tell us how you intend to meet that aspiration?

Well, she knows that I do. It was a manifesto commitment on the part of my party. There are many ways of achieving that. One of them, of course, is making sure that the Welsh in education strategic plans across all local authorities deliver what they should be delivering.

Thank you, First Minister, and I agree that the aspiration is a good one, and I’m glad that you’ve mentioned education. In your consultation on creating a million Welsh speakers, you explain how education must play a central role. Your main objective, and what you’re asking local authorities to achieve, is, I quote:

‘A significant increase in the number of children and young people educated through the medium of Welsh or bilingually in order to create more Welsh speakers.’

And that they should, and, again, I quote:

‘Move schools along the language continuum, to increase the availability of Welsh-medium school places’.

Do you accept that it is Government policy, and that means that local authorities have to increase the number of Welsh-medium schools, and Welsh-medium school places, in their area?

Yes, they are expected, of course, to show how they will do that via their Welsh in education strategic plans. Those plans are subject to approval by us as a Government, and we intend to make sure those plans are robust and that they will deliver.

First Minister, you will know that national policy has informed the decision in Llangennech in Carmarthenshire to convert a school from dual stream into Welsh medium. Now, that decision needs support from you, but it also needs calm explanation to residents. I’ve got some serious concerns about the, frankly, toxic atmosphere that has emerged on this question. And I’m aware that, among a group of residents campaigning against Carmarthenshire County Council’s decision, there are some people standing for the Labour Party in Llangennech in May’s county and community council elections. Now, it’s come to my attention that some of those candidates claim to be working with UKIP, checking and agreeing the UKIP leader’s statements on this issue—[Interruption.]

First Minister, is it acceptable to you that there are Labour Party candidates working closely with UKIP on the question of Welsh-medium education? And do you agree with me that the campaign against Carmarthenshire council’s decision has become toxic and unacceptable? And will you outline what action you will take regarding Labour Party members working with UKIP to undermine your own Welsh language policies?

I agree the situation in Llangennech has become toxic. I do not think that the words used by the leader of Plaid Cymru have helped the situation in terms of turning this into a party political issue. There are some comments that have been made by politicians that I do not agree with. I’ve seen those comments, and I think it is hugely important now that calm prevails, that the toxicity—some of the toxicity that I think we last saw some years ago—is now reduced, and that the council, of course, is able to explain to the people in Llangennech as well as they can—

It is a Plaid council who implemented the policy. I make no criticism of the Plaid council in that regard, but it is important the council are able—[Interruption.] Well, if the leader of Plaid Cymru asks a question, she may want to listen, because it’s hugely important, as she has rightly said, that the toxicity is reduced. It’s hugely important now that the council is able to fully explain, as I’m sure it’s been trying to do, what its policy is with regard to Llangennech. But it is not for us to explain; it is for the council run by your party—

[Continues.]—to explain. It is for us, of course, as a Government, to enable local authorities to produce Welsh in education strategic plans so that we continue to support the language, as we do, and we continue on our quest to ensure that we have a million Welsh speakers in 2050.

The leader of the Welsh Conservatives, Andrew R.T. Davies.

Thank you, First Minister—thank you, Presiding Officer, sorry. There is an urgent question coming a little later on the Kancoat findings in the public accounts report, but I do want to ask several questions to the First Minister this afternoon on this particular issue, given you were the First Minister when these decisions were taken. So, I think that’s an important consideration.

Given all the warnings that were in place—and it would seem pretty comprehensive from the warnings that were given that there was a weak business plan, that the due diligence was ignored, that Finance Wales said there was an unacceptably high risk and that’s why they turned down the application for funding—what on earth would you suspect possessed the then business and enterprise Minister to agree to the release of this money, despite all the lights flashing on the dashboard that were showing this was such a risky investment, First Minister?

I think what has to be remembered is that the investment panel recommended approval of the investment. The Minister, I have no doubt, was guided by that information.

First Minister, it is a fact that, as the investment continued—because this money was released over time, it was—time and time again, as I’ve said, those lights were flashing on the dashboard. Three point four million pounds was released to this company, and it has been lost, in effect; no jobs were safeguarded, that site is now empty, and you as a Government hold the liabilities of that site because the lease was offered up as security against the loan that was made available. The Government is on the line to turn that site back ready for the landlord to take possession. So, there are ongoing liabilities. As I said, £3.4 million was lost. Every indication shows that, whilst in the first place the decision might have been taken in the best interest of securing that business, as the applications were made continuously to release more money, more and more warning lights were coming on, and yet the decision was taken to release more money into this company. Do you not think that taxpayers are owed an apology by your Government for the loss of this money, and in particular for the inability to safeguard any jobs by the £3.4 million that was put into this company?

Well, the Cabinet Secretary will deal with the issue of Kancoat when the urgent question is raised. But if I just explain more generally: we deal with hundreds of businesses; some of them fold. We cannot possibly say that every business that we help will inevitably be successful. No bank could do that, and it’s the same for any Government. But I can say that, of the projects that we have supported, only 2.4 per cent of them have failed to deliver on their objectives that were attached to their request for financial support, and so we have a success rate of well over 90 per cent in supporting businesses. That means, of course, there will be some businesses that are not successful, but they are very much the exception rather than the rule. That does not mean, of course, that we should not continually review the way we conduct due diligence, and that is something that we will continue to do. But I do think it needs to be put into context, remembering, of course, that of the businesses that we have helped, the vast majority of them are successful, which is why, of course, unemployment in Wales is so low.

First Minister, you were the First Minister at the time, and I do accept that these decisions are based on risk and that some will go wrong, but the point I’ve made, through the two questions I’ve put to you, is that there were numerous warnings highlighting the risk to the Government and to the taxpayer by releasing the money into this company. Finance Wales, which is a lender of last resort, for example, said that it was too risky to release the money on a loan basis from their good selves, and their remit for operation is to be a lender of last resort after normal commercial banking has been exhausted. So, I do take that point that, ultimately, there is an element of risk in all the decisions you take, but it is a fact: as we stand here today, £3.4 million has been lost, not one job guaranteed or protected and, ultimately, the taxpayer is out of pocket and the Welsh Government have continuing liabilities from this decision. I asked you on my second question: do you think that there should be an apology on your behalf from the Welsh Government to the Welsh taxpayer? I offer you that opportunity again. Will you apologise for the loss of this money, which is taxpayers’ money, in this particular instance, when so many warnings were made and so many of those warnings were ignored by your then Minister? Ultimately, it’s the taxpayer who’s lost out.

I accept what the leader of the Welsh Conservatives has said—that he understood the situation in terms of the initial grant of support. This was a start-up business. Start-up businesses are inherently risky, but there must be an acceptance of risk by Government. Otherwise, we wouldn’t support anything. It’s the same for commercial banks; they will find themselves in that situation from time to time. This organisation, of course—the business, rather—was set up at a time when the economic situation was precarious in the aftermath, or the near aftermath, of the financial crisis. As I said, the Cabinet Secretary will go into detail in terms of what the timetable was, but I can say that we are proud to say that unemployment in Wales is so low. It’s lower than in England, it’s lower than in Scotland and lower than in Northern Ireland. Historically, that has been a tremendous achievement. We have supported over 1,000 businesses to create jobs in Wales. We’ve brought investment into Wales—the best foreign direct investment figures for more than 30 years. It’s correct to say that, on occasion, there will be businesses that fail and it is difficult then to have the money returned to Government. But in the context that we operate here, 97.6 per cent of the businesses we support are successful in providing jobs for the people of Wales.

Diolch, Lywydd. It’s quite clear that the policy of the American Government is going to change in many respects as a result of the election of President Trump, not least in respect of policies on climate change. Scott Pruitt, who is President Trump’s nominee as head of the United States Environmental Protection Agency, has already caused to be removed from the department’s website the US commitment to the UN climate change negotiations. Now, given that the United States, China and India, between them, are responsible for more than half of the global carbon dioxide emissions in the world, and China and India have not signed up to any absolute reduction in the level of those emissions, regardless of one’s views on whether man-made climate change is a reality or not—regardless of views on that—does it make sense for Britain, and Wales in particular, which is responsible for only 0.05 per cent of world carbon dioxide emissions, to be saddled with a dear energy policy that is a millstone round the neck of the manufacturing industry and industries like the steel industry in particular?

Well, I have to say I look at the weight of evidence, and the weight of evidence is overwhelmingly—overwhelmingly—in favour of showing that climate change is happening, and, secondly, that human activity is causing it either to happen or to be exacerbated as a result. Those people who claim otherwise are on a shaky scientific basis. I look at the weight of evidence, and it is quite clear to me—. He will know, as he was a lawyer once, that it’s the weight of evidence you have to look at, not select what you think best supports your argument when it flies in the face of scientific reality.

It’s right to say that China and India face challenges, but China is up to the challenge. China is investing heavily in alternative fuel sources. It knows it has a problem. Anybody who’s been to Beijing and the big Chinese cities will know that there’s a problem there with air pollution. The Chinese Government recognise this, which is why they are looking for those alternative fuel sources. They know that they cannot continue with the current situation, but while they are going in the right direction, my fear is the US will go in the opposite direction, flying in the face of the weight of scientific evidence.

The First Minister has sidestepped my question. My question is not to do with the argument about whether man-made climate change is a reality or not. My question relates to: what difference does it make if we sign up to targets that are going to pose enormous costs upon us, not just in terms of cost for industry but also on ordinary people? After all, nearly a quarter of the households in Wales are in fuel poverty, spending more than 10 per cent of their incomes on keeping themselves warm in the winter, for example. So, this is a real burden on poor and vulnerable people. If it makes no difference to the outcome in terms of global emissions, why should we saddle ourselves with these enormous bills? China and India are not signed up to reducing the absolute level of their emissions. What they’re signed up to is reducing energy intensity, but that has to take into account the extent to which they expect their economies will grow, and their economies are going to grow to a greater extent than they reduce their fuel intensity. So, absolute emissions are actually likely to increase in India and China, and that makes the problem even worse, and we’re the fools who are paying the bills.

Well, that view is only valid if you accept that you’re happy to see environmental degradation; happy to see air quality reduced; happy to return to the days when, I think, it was the River Irwell in Salford that was literally flammable when a lit match was thrown into it; happy to return to the days when the River Ogmore in my home town would run different colours according to what had been thrown into the river. Because the natural journey from moving away from seeing climate change as important is to see the environment as unimportant as well. We know that those people who do not accept that climate change is happening—many of them do not accept that there’s a need for an environmental regulation either, certainly to the extent that we see now. This is not something we can dismiss. We can’t simply say, ‘Well, it’s something that we can just put to one side’, nor do I accept that this is something that imposes cost. The reality is that I’ve heard him argue for more coal-fired power stations. The irony is rich in what he says. The coal would have to be imported. So, there are issues of energy security as well. Should we not invest in wind power offshore? Shall we not invest in tidal energy, rather than over-relying on energy sources that have to be imported into Britain? So, energy security and mitigating climate change, to me, run hand in hand.

The First Minister is refusing to address the issue behind my question. Wales is responsible for 0.05 per cent of global carbon dioxide emissions. Carbon dioxide is not a flammable gas, by the way. So, what he said about the air quality in Peking is irrelevant. Sulphur emissions are completely different. The argument about particulates in the air everybody accepts. It was a Government 60 years ago that introduced the Clean Air Act, and everybody is in favour of that. This is a totally different question. My point is that Wales is one of the poorest parts of western Europe. We have nearly a quarter of our households in fuel poverty. They’re having to spend hundreds and hundreds of pounds, which they can ill afford, every year paying for our renewables obligations under EU directives. If the United States is now going to resile from commitments to reduce its own carbon dioxide emissions, and if China and India are not signed up to it anyway, what is the sense in us making infinitesimal difference to the amount of carbon dioxide emitted in the world—an obligation that is causing real harm and real poverty in households in Wales?

I do not think that I said that the air in Beijing was flammable. I’m not sure that the hydrogen or, indeed, the oxygen content is so high that the air would catch fire or even explode. I was referring to a particular river, the context of which is well-known. My concern is that those who say that climate change is unimportant quite often take the view that environmental regulation is a burden on industry. I do not accept that. But again, I come back to this point: the wind blows; it’s free. The tide will be there as long as the moon is in the sky. There is a capital cost, of course, of putting in place the infrastructure to generate energy, but once that is in place, the generating costs are very low indeed. I don’t know what his alternative is. He hasn’t outlined it. He talks of coal. He did his best to wreck the coal industry. The reality is that we will never produce enough coal in the UK now to supply our energy needs. We would have to import it from countries like Australia. We would have to import natural gas from countries that are not looking to do us a favour. We would have to import more liquid natural gas from countries around the world. We do that already. Now, whilst I know the energy mix in the UK is going to continue in the future—and indeed, 25 per cent of the liquid natural gas in the UK comes through Milford Haven, and that is something that will continue in the future—I do not see the wisdom in saying what we need to do is to go back to the technology of yesterday, with the pollution of yesterday, and look to ignore the overwhelming weight of scientific evidence and put our heads in the sand. He is somebody who is proud, he says, to be British. Then let him display his pride by saying that he wants the UK to lead the way when it comes to dealing with climate change.

Assisting Businesses in South Wales Central

3. Will the First Minister make a statement on what the Welsh Government is doing to assist businesses in South Wales Central? OAQ(5)0450(FM)

[Interruption.] Yes. We are delivering a range of actions to help new and existing businesses to develop, grow and support. That includes business support, advice and investment in digital and transport infrastructure.

I am not quite sure why the backbenchers are muttering there. It’s perfectly within the right of a Member to raise a question in this place, and First Minister’s questions is the time for that to happen. First Minister, I have commended the Welsh Government previously for the money they have made available for transitional relief around the business rates scheme. They made an announcement on 17 December of an additional £10 million—or the Welsh Government made an announcement on 17 December of an additional £10 million—to assist in the recent revaluation exercise of businesses in South Wales Central and, indeed, across Wales. To date, no more information has come out from the Welsh Government as to how that money will be delivered, despite us on these benches, and others in the Chamber, pressing for some more information. We were told that that information would come out in early February. To date, I don’t think that information has been forthcoming from the Welsh Government. When will the Welsh Government be coming forward as to how you are going to distribute that money, so that businesses can make the decisions that they need to make ahead of the new financial year?

In the climate change committee, we heard evidence that businesses that have actually done the right thing and put solar panels on their roofs are actually being charged additional business rates. So, my question is, really: what levers does the Welsh Government have to support businesses that have a positive social and environmental impact, e.g. healthy food establishments, and to discourage businesses that have a negative impact, e.g. betting shops, pay-day lenders and other organisations that Mike Hedges raised earlier?

We do this mainly through procurement. Wales’s procurement policy encourages the Welsh public sector to apply approaches whereby community benefits or social clauses are core to contract award criteria wherever possible. By doing so, contract award decisions can favour those suppliers who provide strong evidence of delivering against our social clause requirements. So, procurement can be an effective tool in encouraging good business practice and, indeed, good business practice in the community.

First Minister, the real question you should be answering is what you are going to do to try and restore just some credibility in the Welsh Government after giving the business community in Wales 53 million reasons to lose faith in you. At least £53 million is how much your Government has lost in gross incompetence with business support and land deals—£53 million lost at least. When will a thorough investigation take place?

In terms of the answer I gave some moments ago, I can say to him that 97.6 per cent of the businesses that we support are successful, and that is an excellent record in itself.

Promoting Job Creation in Newport

4. Will the First Minister make a statement on how the Welsh Government is promoting job creation in Newport? OAQ(5)0458(FM)

We are taking forward a range of actions to support the creation and safeguarding of high-quality jobs in Newport and, indeed, across the whole of Wales.

Thank you, Frist Minister. The Office for National Statistics, based in Duffryn in Newport, is opening a data science campus in March. The campus will act as a hub for analysis of big data, which will allow collaborative work between academics, Government, the public sector, industry and third-sector partners that wish to push the boundaries of delivering their services. Providing rich, informed measurement and analysis on the economy, the global environment and wider society, the campus will become a world-class facility. The aspiration to create a Silicon Valley for Wales is the intention, and that it will be a hub for innovative data science research, helping to create jobs and attract investment. Will the Welsh Government work with its partners and the ONS to promote this endeavour to create a ‘dyffryn silicon’ for Wales?

Yes, we will. It is hugely important, we know, that where there is an existing level of expertise, clustering new businesses and new innovations in that area helps everybody. Newport is acquiring for itself, very rapidly, a good reputation for software and for ICT more generally, and that’s something, of course, we're very keen to encourage in the future.

First Minister, Newport is one of the worst-performing towns or cities in the United Kingdom when it comes to empty shops. More than a quarter of shops in the city were empty in the first half of 2016, according to the Local Data Company. What scheme does the Welsh Government offer to provide incentives, such as tax breaks, to people to open new businesses in areas where there are large numbers of empty shops, such as Newport, to create jobs and regeneration of our city centres?

Well, I think that councils do a good job of encouraging businesses, but landlords also have to play their part. Landlords have to understand that the days of being able to charge an unrealistic rent for a long-term lease are gone. They're not there anymore. It's hugely important that landlords are flexible and they look to encourage pop-ups for those businesses that want to test the market for three months but don't want to get involved in a lease that's five to 10 years long. Landlords will find that, by doing that, they will potentially fill their shops, because some of those businesses will not succeed, some of them will succeed, and if they do, of course, the landlord then has a longer-term tenant. So, it's not just down to councils, in fairness; it's also important that landlords are able to work flexibly to provide opportunities for businesses for the twenty-first century.

The Third Sector

5. Will the First Minister make a statement on the role of the third sector in Wales? OAQ(5)0446(FM)

The third sector plays an important role in Wales. There are over 33,000 third sector organisations providing services in every sphere, from the environment through to supporting health services.

Diolch, First Minister. Are you aware that Public Affairs Cymru revealed that over half its members had stated that the examples have occurred—I'm quoting now—

‘where lobbyists and campaigners have been asked to reconsider standpoints or not to say certain things with which the Welsh Government is not in agreement’?

Well, first of all, I thought lobbyists had no contact with Government—we've been told in this Chamber—but, really, in other words, your Government is leaning on people, and leaning on organisations. It's censorship, and it’s undemocratic. So, in light of this scandal, in light of these scandalous allegations, why won't you investigate this matter?

I don't know if he's suggesting that the third sector, which is was what his question was actually about, is involved in this, because, certainly, the supplementary wasn't to do with the third sector. It's something that I think exists mainly in his own mind. What evidence is given to a committee is a matter for the committee to consider and produce a report, not actually say in the middle of an inquiry that—. It's not appropriate, I think, for a Member, in the middle of an inquiry, to comment on the evidence as the inquiry is ongoing. We as a Government respond to reports in due course, but the evidence hasn't been considered. I can say that, as far as we're concerned, we don't tell organisations what they should or should not say. Otherwise, there’d be little point in having organisations whose job it is to hold Government to account, as well as this Assembly.

Will the First Minister join me in celebrating the recent anniversary of one of the leading third sector organisations in my constituency, Tiddlywinks children's centre in Ystalyfera, where I recently visited and saw for myself the excellent service that’s provided by an organisation that was the first of its kind in Wales and is now a self-sustaining social enterprise? There are many others of the same ilk in the Neath constituency. I was with one with the Minister for lifelong learning on Monday, discussing the work of the Valleys taskforce. They provide key childcare services and are a significant source of employment. So, will he join me in acknowledging the invaluable role of the third sector in providing childcare services, both in Neath and across Wales, and does he agree with me that the third sector, a vibrant third sector, can actively shape policy and, with the right support and imagination, can also deliver services to our communities, making them more resilient? And does he agree with me that it is, and should be, a priority for the Welsh Government to support the sector?

I thank the Member for the question. I'd like to congratulate the staff, trustees and volunteers who have been part of Tiddlywinks’s journey over the last 20 years; they shaped and influenced the minds of many children who, I've no doubt, have fond memories of their time there, and I, of course, hope they're able to continue do so in the future as well.

First Minister, Fairtrade Fortnight runs from 27 February to 12 March, and I think we should be rightly proud that Wales has been a Fairtrade Nation since 2008, and it's the first ever. Eighty-two per cent of local authorities and 93 per cent of universities have fair trade status, 150 schools, and a further 50 per cent are registered on the fair trade schools scheme. The Welsh Government has fair-trade status, but concerns have been raised with me about some ambiguity as to how you are applying the fair-trade model. Will you look into this to ensure that it isn’t just a status, that there is a culture of fair-trade acknowledgement in terms of procurement within your own departments across the Welsh Government?

If the Member could provide me with further information I would be pleased, of course, to look at this for her.

First Minister, the third sector and its army of volunteers save the public purse millions of pounds each year and provide valuable services that the public sector cannot. The third sector protects us when we go to the beach or the rugby, provides valuable research into numerous diseases and conditions, campaigns for better rights, housing and a whole host of other services. Without the third sector, our lives would be much, much poorer. First Minister, what more can the Welsh Government do to ensure the third sector can continue to thrive in Wales and provide recognition and thanks to the volunteers who drive this sector?

The Member’s right. The Wales Council for Voluntary Action’s research suggests that the value of the third sector in Wales is £3.8 billion. The sector employs 79,000 people and works with 938,000 volunteers, a startling number. That’s nearly one in three people in Wales volunteering in some capacity. We have provided £4.4 million in 2016-17 as core funding for the WCVA and Welsh county voluntary councils across Wales, and they, of course, are in a good position to assist voluntary organisations in terms of their own financial security, and in assisting them to understand where they should go to seek financial help. So, that money goes a long way in terms of providing support to so many organisations that provide so many services to so many people.

Rail Services in South-east Wales

6. Will the First Minister make a statement on rail services in south-east Wales? OAQ(5)0461(FM)

We are currently procuring an operator and development partner for Wales and borders services from 2018 and also the metro infrastructure. That process includes discussions with bidders on how services in the south-east of Wales can be best delivered as part of the wider provision of the south Wales metro.

Thank you for that, First Minister. As you are well aware, the Newport to Ebbw Vale passenger rail link remains a top propriety for local people, and there is a deal of frustration and impatience that it’s not yet established. Are you able, First Minister, to provide further reassurance today that that passenger rail link between Newport and Ebbw Vale remains a priority for Welsh Government? And are you able to provide any timings as to when it will be in operation—the latest timings, if possible?

It’s not possible to give a time as to when the service might be in operation, but I can give the Member an assurance that service provision on the Ebbw Vale line is being examined as part of that project. He has on many occasions in this Chamber over the years emphasised the importance of a service going to Newport, and that is very much part of the developing thinking over how the metro will operate in the future.

First Minister, the renewal of the Wales and west border franchise is fast approaching. Has the Welsh Government at least begun the process of ordering or considering ordering new rolling stock for that franchise? I ask the question because, given that it takes up to four years to commission new rolling stock—it’s not like buying a car at the local garage—do you share my concerns that there’s a danger that the new rail operator will have no choice but to rely on existing stock at the start of the franchise, will almost certainly end up refurbishing it, and that would hardly be the fresh start for the new franchise that the public would be hoping to see?

It will be absolutely clear as part of the franchise proposals that rolling stock should be modern, certainly not 40 years old, as some of the stock is on some lines at the moment, and that that stock should provide facilities to passengers such as Wi-Fi, which isn’t provided at the moment. So, I can give the Member an assurance that this is very much part of the tendering process for the new franchise. We want our people to have the best rail services in the UK rather than services that rely on outdated stock.

Following on from the question from John Griffiths, AM for Newport East, Arriva Trains Wales tell us that the Ebbw Vale line is at full capacity with those wishing to travel to Cardiff. It would seem that only a twin track through to Ebbw Vale would alleviate this problem. Would the First Minister inform us if there are any plans to implement this option?

Well, it can be double track, it can be partial double track, and it can be signalling that makes the difference. It’s good news, of course, that the service is so well used that frequency needs to be increased. These things, amongst other things, will be looked at, working with organisations such as Network Rail, to provide an improved service in the future. Again, that’s very much part of the thinking on the metro and the new franchise.

The Shellfish Industry

7. Will the First Minister make a statement on support for the shellfish industry following the decision to leave the EU? OAQ(5)0456(FM)[W]

We are working with the industry and highlighting to the United Kingdom Government the fundamental need to secure continued unfettered access for Welsh shellfish to key markets post European Union exit.

Thank you for that response. In 2015, marine agriculture was worth some £12 million to the Welsh economy. It is an important industry and employer in my constituency and the ability to sell in a single market without tolls has been an important contribution to the success of the industry. To give you some figures, 98 per cent of the produce of Bangor Mussel Producers is exported—some 70 per cent to the Netherlands, 20 per cent to France and 10 per cent to Ireland. May I quote one of the leaders of the industry, who has praised some of the negotiations that have happened internally in Wales since the vote? He said that he fears the worst for Wales because of the fact that Wales, Scotland and Northern Ireland will not have a direct voice in the negotiations on exiting the European Union. Can the First Minister tell us, therefore, what the Welsh Government strategy will be from here on out to try to safeguard the future of these important industries?

Ninety per cent of the fish caught in Wales are exported, so any tariff or toll or any other kind of obstacle will be bad for the export market. We know that the United Kingdom market is too small to secure a future for them and that is why it’s so important to ensure that the United Kingdom Government sticks to its word in order to ensure that there is a strong voice for Wales, Scotland and Northern Ireland over the ensuing discussions over the next two years and more.

First Minister, I hope that the Cabinet Secretary’s meeting in April will be fruitful in promoting our shellfish to the whole of the world, not just to the European Union. But, as you know, the level of parasites found in cockles from the Burry inlet, just off the Gower coast, is higher than expected. Of course, if we are to meet the global demand, we need our cockles to survive. The European Court of Justice took action to limit the number of spills permitted in the area to help limit the rise in certain bacteria, but the cause of the disease that limits some cockles reaching maturity is still unclear. The great repeal Bill—following that, I hope the environmental laws will continue to go some way to protect cockle health. But I think we need to commit to a further sturdy on the cause and prevention of early cockle death. I’m wondering if you’re able to give that commitment to the Chamber today.

I can say that investigations into cockle mortality on the Burry inlet do continue. A progress review of an investigation we have funded will be released by Natural Resources Wales when that is complete. We are working with the industry to develop legislation to improve the management and sustainability of Government-managed cockle fisheries as well. It is a complex issue. Some years ago. I remember diarrhetic shellfish poisoning affecting the cockle beds—it was never clear what the cause was. There were different theories about what had happened. What we do know, of course, is that the affliction was there in the cockle beds. So, it’s important now that a thorough investigation is finished in good time so we have an answer. Once, of course, we have answers, we can then provide the most effective legislative response possible.

The First Minister is aware, from his time as Minister for fisheries and agriculture, how crucial the shellfish industry is to the Welsh coastline. But given that the shellfish industry was never part of the common fisheries policy or the common agricultural policy, isn’t it reasonable, therefore, that it could be expected that that industry could continue to sell into the European continent as it has done over the years?

It’s all-important—we know that shellfish is extremely important to the fisheries industry in Wales. The majority of the boats that we have are relatively small, they catch shellfish, and they don’t go very far from the coast. And they know, and we know, that there is a strong market for them in Europe. If anything were to happen to weaken their position in that market, well, they don’t have any alternative means of making the same profit. And that’s why it’s so important to ensure that the European market is open on the same terms in the future as it is now.

The Twenty-first Century Schools Programme

8. Will the First Minister make a statement on the 21st century schools programme in Torfaen? OAQ(5)0459(FM)

Yes. I know that Torfaen local authority has over £86 million earmarked for band A of the twenty-first century schools and education programme, which extends over the five years to 2019. I know that projects to the value of over £66 million have already been approved, with six projects either under construction or completed.

Thank you, and I was delighted to welcome the Cabinet Secretary for Education to Torfaen last week to officially open two new primary schools in Cwmbran: Llantarnam Community Primary School and Blenheim Road Community Primary School, and these have been constructed as part of the twenty-first century schools programme. With Ysgol Panteg, which is due to open to pupils later this month, combined, it means that the investment will be some £20.5 million. Will you join with me, First Minister, in welcoming the commitment and investment by Torfaen council and Welsh Government, who are working in partnership to deliver first-class education facilities for our children?

Indeed. My friend the Member for Torfaen is absolutely right: more than £20 million invested in schools in Torfaen—a good example of the local authority working with Welsh Government to deliver the best for our children, and yet another good example of the Welsh Government and a Labour-controlled local authority delivering schools that are fit for the twenty-first century and good for the children of Torfaen.

First Minister, existing sixth forms at Cwmbran High School, St Albans Roman Catholic High School and Croesyceiliog School will be phased out soon. Given that sixth-form staff in these schools will have to compete for jobs at the new centre, will the First Minister advise how many redundancies are expected as a result of this reorganisation and what discussions his Government has had with Torfaen council in this regard, please?

Well, local authorities are responsible for the organisation of education in their areas, and, of course, Torfaen, as other authorities are doing, are looking to provide the best and most modern provision possible.

2. Urgent Question: Kancoat

[R] signifies the Member has declared an interest. [W] signifies that the question was tabled in Welsh.

I have accepted an urgent question under Standing Order 12.66 and I call on Russell George to ask the urgent question.

Will the Cabinet Secretary make a statement following the Public Accounts Committee’s report into the Swansea-based firm Kancoat? EAQ(5)0121(EI)

Ken Skates AM 14:17:00
The Cabinet Secretary for Economy and Infrastructure

Yes. I and my officials have assisted the Public Accounts Committee at every stage of its considerations of this issue. I have received, and very much welcome, the committee’s report and will be fully responding to it.

Can I thank the Cabinet Secretary for his answer? The report produced by the Public Accounts Committee raised some very serious concerns, I would say, Cabinet Secretary, over the conduct of the Welsh Government, as yet another substantial pot of taxpayers’ money—£3 million—has been lost. There are some questions over accountability, and this is sadly not the first time that taxpayers’ money has been wasted by the Welsh Government. We’ve had numerous other questionable decisions, including the regeneration investment fund for Wales, Kukd and Triumph. I certainly do not believe that Governments should not take risks; I certainly believe they should, but they should do so in a balanced way. In relation to Kancoat, time and time again, the expert advice given to the Welsh Government warned that the company had a weak business plan and was a high-risk investment. So, can I ask why, in your opinion, Cabinet Secretary, was the advice ignored—also bearing in mind, of course, that the Government’s investment arm, Finance Wales, rated it as being unacceptably high risk? What is your determination on this, given the changes I know that you’ve made in your department since you’ve come into post, and is it your view that the department you inherited was simply not fit for purpose? Have you mentioned—? You’ve mentioned in recent statements that you’ve now put new procedures in place; what are these new procedures? I think that’s the crucial question here. And finally, where do you think accountability lies? Is it with your predecessor, or is it with officials?

Can I thank the Member for his questions? We are learning at all times and, indeed, my predecessor made changes within the department when she inherited it. Indeed, my predecessor introduced the investment panel procedure to strengthen oversight of investment considerations and to ensure that where risk was being considered an informed decision could be made. The deputy permanent secretary is on record as saying that, in this instance, the investment panel got it wrong and, therefore, provided advice to the Minister that was wrong. But I think, and the Member recognises the fact, that we have to balance risk against opportunity. And it is, as the First Minister has already identified, a case, a fact, indisputable, that in the previous Assembly term, during which time my predecessor oversaw record growth, the success rate of businesses supported by Welsh Government was more than 97 per cent. That compares incredibly favourably to the Welsh average and, indeed, even better to the UK average. So, I think it is actually a very proud story that we have to tell about the business support success of Welsh Government. Nonetheless, not all businesses survive, not all businesses succeed. We will do what we can to help businesses thrive, but there will be cases, especially in the context of the post-financial crash, where businesses were established and where the economic climate was not such that it was stable and enabled the forecast growth to be achieved.

We do have a number—and the Member recognises this—of procedural changes that have been implemented. I’d happily write to all Members with details. In fact, as the leader of the Conservatives, I think, wishes to know what they are, I will offer them now: consideration of commercial loans now forms part of the investment panel procedure; the senior management team must now ratify any recommendation by the investment panel for commercial loans above £1 million; as part of the financial approval process, a standalone appraisal of all projects involving commercial loans must now be undertaken; the monitoring of loans has moved to the central monitoring team—that was an agreed departmental protocol; loan applications are more robustly assessed for their ability to repay by undertaking appropriate financial due diligence; a further change in procedure, which the WAO recognised was a standardised approach to risk assessment, has been introduced to ensure consistency across funding schemes, and where multiple interventions are being considered, they are now considered by a single body, with appropriate advice from the property leadership team. There are other procedures that we have introduced in the fourth Assembly. There are further procedures that I’ll be introducing as well.

In terms of the recommendations that are made by the committee, and I do value the work of the committee and, indeed, the report that’s been produced, I think it would be very difficult to disagree with any of those recommendations that have been made that are relevant to my portfolio. Whilst I will be responding in due course to all of the committee’s recommendations, I can say that I already accept a number of the recommendations and, indeed, I’ve already implemented some.

Of course, one recommendation you can’t respond to, but which must lay on file for the moment, is the wider recommendation on ministerial responsibility, taking decisions that are important to a Minister’s constituents and constituency, but not actually based in the constituency. The Public Accounts Committee says that the perception of a conflict of interest is just as important as an actual conflict of interest. On this occasion, I suggest that the First Minister took his eye off the ball and didn’t realise what procedures should be followed, and another Minister should have taken this decision.

Can I also ask the Cabinet Secretary and tell him that I wrote to his predecessor, Edwina Hart, on 1 August 2014—several weeks before the company went into administration—raising with her several serious concerns expressed to me by workers at the company who are resident in my region, in Llanelli, because workers from this company are spread over quite an area? They were particularly concerned at the lease that had been taken out by the then Welsh Assembly Government, which I was told was worth £1.25 million and ran for five years without a break clause within those five years. Can I understand, therefore, are you still subject to that lease and what is the ongoing cost of that lease to the Welsh Government? Because that would seem to be in addition to the costs we’ve seen so far in the Public Accounts Committee report and I’d like confirmation of that.

The second element that gave great concern to the workers at the plant was the fact that several directors, at the time they were laying off workers, were employing themselves for a period of time at a cost of up to £7,000 per month, as self-employed consultants or otherwise employed full-time with Kancoat. This was a time when the company was seen to be struggling publicly, and I raised this directly with your predecessor. The answer I got from her was simply one to say that all full and thorough due diligence had been undertaken. We now know that that doesn’t seem to have been the case. What do you say now, two years down the line, to the workers there who were raising these concerns, and are you completely assured that the directors of this company did not take any money for themselves, personally, out of the unfortunate situation that the company found itself in?

Can I thank the Member for his questions as well? I do believe that the question of ministerial responsibilities is one for the First Minister. I would warn against requesting that all perceived conflicts of interest are dealt with in a way that would potentially cause inertia within Government. We are a small country with—particularly in south-east Wales—a very wide travel-to-work zone, and so it’s important, whilst recognising the need to ensure that there are no perceptions of conflicts of interest, that we do enable Ministers to be able to make decisions on a regional basis. However, this, as I say, is a matter for the First Minister to respond to. I’ll happily review all correspondence, with his permission, that the Member sent to my predecessor, which he’s raised in the past, and the concerns that he has expressed in the past. I’ll check against due diligence, but it’s not necessarily the case that due diligence would have failed. It is that a risk assessment was carried out based on the information that had been provided, and then a decision was based on that, further to the investment panel’s considerations.

In terms of the question of the lease, this relates—I believe—to recommendation 11, and the wider question of any ongoing financial costs to the Welsh Government. There is active interest from investors in the site, and once the outcome of the negotiations is known, officials will share any financial implications with Members of this Chamber. I also will undertake to investigate, with regard to the final question the Member has raised, whether the directors of that company stand to benefit at all post the company’s collapse.

Cabinet Secretary, thank you for your earlier answer. Can I firstly welcome the Welsh Government’s commitment to providing a full response to the committee’s report on the Kancoat situation? As you said, your response to the report will be considered in full by the committee, so I don’t want to prejudge that stage of the process, or indeed be repetitive with questioning. I’m pleased to hear that you’ve already said that, in principle, you are prepared to accept a number of the recommendations of that report, and I think you also said that you’ve already taken steps to see that those are put in place, and that’s a really positive step, so thank you for that.

Can I ask you, on a broader issue, do you welcome the intention of the Auditor General for Wales to undertake a broader value-for-money examination of the Welsh Government’s approach to business finance, and will you and your officials co-operate with this examination later this year? It’s obviously, if it goes ahead in the format that the auditor general is considering, going to be a very large piece of work, but I think it will be a useful one, both for the Government and also the public to have confidence that procedures are in place to make sure that the sorts of problems with due diligence, and the rest that we’ve seen with Kancoat, don’t happen again. Can I just say, Cabinet Secretary, that the committee does recognise how vital Welsh Government funding is for business in ensuring the future prosperity of Wales—a point made by Russell George in his opening question—and we want to ensure that it’s administered to best effect? We welcome the planned work in ensuring that taxpayers’ money is well spent in the interests of efficiency, value for money, and with wider economic benefits, and I look forward to your response to the committee, and I’m sure that we can move this situation forward.

I’d like to thank Nick Ramsay for his questions, and also for overseeing this inquiry as Chair of the Public Accounts Committee. Yes, we will be working closely with the auditor general, and I very much welcome his intention to carry out a broader investigation of business support by Welsh Government. One of the additional procedural changes that are being introduced through a wider level of activity for the investment panel is the ability to pause and reflect on the work that’s being carried out by the team of officials that will be the project lead on investment programmes and I think that has enabled us to get some peer review of the work that’s taken forward by one group by a different group in Government. I can tell the Member at this moment that, in terms of the 11 recommendations, I’ve already stated with regard to the final recommendation that there is active interest, and I will provide Members with more information about the outcome of negotiations as they are completed.

Running briefly through each of the recommendations, with regard to recommendation No. 1, we’ve already started to define advanced materials and manufacturing, and I think that the advanced manufacturing research centre in Deeside is a case in point. With regard to recommendation 2, that, I believe, should be accepted, and we’ve already begun incorporating the recommendation into procedures. With regard to recommendations 3, 4 and 5, again, in principle, we accept the recommendations, and it’s entirely appropriate to revisit the guidelines on non-repayable business finance in light of changing business needs and the economic climate. With regard to recommendation 6, again, a recommendation on risk identification and proposed mitigation is accepted I think—should be accepted—and, again, is being implemented.

And, turning to recommendations 8, 9 and 10, again, we’ve accepted those, and are implementing them.

I accept what the Cabinet Secretary said about the nature of risk. Indeed, the First Minister said earlier on in questions that not all investments, however careful you are, are going to succeed, and it would be unreasonable to be too critical when they fail for reasons that are beyond our control. The deputy secretary said in evidence to the Public Accounts Committee that the Government’s role here is effectively as a lender of last resort, and he said:

‘Financing things that the private sector won’t finance implies taking risks that the private sector won’t take, which implies things are going to fail.’

So, you start out from a position where you have to be hyper critical.

But what we’re dealing with here is a case where the due-diligence advice that was received by the Government’s own advisers was not accepted, and I don’t think the Cabinet Secretary answered Russell George in this respect earlier on. What the due-diligence review said was that the business plan in 2013 was ‘weak and inconsistent’, and the inherent risks of the start-up remained. The replacement of Coilcolor as a major shareholder, and the loss of their guarantee, left the risks identified essentially as unmitigated. And the proposal invited the Welsh Government taking on a significant landlord risk in addition. So, the project was identified as high risk in the initial assessment, and then there was a revised assessment, which actually increased the level of risk rather than mitigated it. So, what we really need to know here, to put this in the context of the Government policy on using taxpayers’ money for these purposes, is why that due-diligence report, which, on the face of it, seems to have red lights flashing and alarm bells ringing in a big way, was not accepted. What was it that the advice given to the Minister contained that overrode all those apparently very obvious warnings?

Can I thank the Member for his questions, and also for recognising that there are inherent risks in meeting market failure insofar as business support is concerned? I do believe that, as a result of implementing 10 procedural changes that have been recognised by the Wales Audit Office, we have improved the system of monitoring and evaluating the risks applied to requests for business support. It’s not the case that due diligence was rejected outright. It was that the due diligence was considered alongside the potential benefits, and therefore the investment panel made a recommendation on this basis to the Minister. But, as I’ve already said, it’s accepted that the advice that was given by the investment panel was wrong. They got it wrong, and this has been recognised from within the civil service.

I think we need to reflect on the context—the economic context—against which the decision was made. There was an appetite to ensure that we had economic growth at a time when we’d just come off the back of severe problems caused by the financial crash, and therefore the appetite for risk was perhaps greater than it might be today, where we have been able to build up economic growth over a number of years, improve employment levels now to near record levels, drive down unemployment rates to below the UK average—indeed, to a record low. And where we can now say with confidence that, as a consequence of business support during the fourth Assembly term—where I do recognise there were some failures—as a result of the support, we ensured that 97.4 per cent of those businesses thrived and succeeded. That is way above the Welsh average across the economy, and, indeed, even better still than the UK average.

Isn’t part of the problem that the investment panel that provides advice to Ministers wholly consists of civil servants, who are accountable to the same Minister? And that doesn’t really therefore constitute independent advice, particularly in cases where the Minister may be thought to have a particular view about a project.

Now, of course, we have the Welsh Industrial Development Advisory Board, which was set up precisely for this reason, is independent—actually, where the Minister goes against their advice, they have to report to the Assembly, so that we can have proper transparency. Surely, every decision on business support should be given over to that independent body, or, actually, if the Minister wants to go even further, he could take it out of Ministers’ and civil servants’ hands completely, and give it to the new development bank, which will probably, it seems, be led by Finance Wales, which, in this particular case, showed themselves to have a better assessment of the risk that this represented than his own officials. And, finally, could I ask him, since the head lease that the Welsh Government entered into represented a contingent liability, was it listed in the Welsh Government’s consolidated accounts?

Can I thank the Member for his questions? I will need to check the details of the final question that the Member has raised, and I’ll write, not only to the Member, but to every Member in the Chamber.

With regard to the WIDAB, that was a sponsored body that’s had statutory status since 1975, or, rather, under the Welsh Development Agency Act of 1975. And, as the Member is aware, it considers decisions where a grant is sought that is in excess of £1 million. There has been a review of the threshold level. That was conducted, indeed, by my predecessor, and that was in January 2013. I think it’s timely for us to review that again, as the Member has suggested, and I’m happy to do so. Consequently, because there was the £1 million threshold, it was not presented with any of the Kancoat cases, as they were not within the remit of the board.

But I do have to say again that my predecessor strengthened procedures. Indeed, she inherited a department where there was no investment panel to consider carefully, as a pause and reflect mechanism. Before my predecessor took charge of the economic portfolio, decisions were largely made by the Ministers, on the basis of advice from officials, without that important pause and reflect mechanism that my predecessor introduced.

3. 2. Business Statement and Announcement

The next item on our agenda is the business statement and announcement, and I call on Jane Hutt.

Llywydd, I have three changes to report to this week’s business. The Minister for Social Services and Public Health will make a statement on Sport Wales shortly. The Cabinet Secretary for Communities and Children will then make a statement on ‘resilient communities—next steps’. And, finally, I’ve reduced the time allocated to the Counsel General’s oral Assembly questions tomorrow. Business for the next three weeks is shown on the business statement and announcement, found among meeting papers, which will be available to Members electronically.

Leader of the house, I’d like to request two statements today, please. Firstly, I’d welcome a statement from the health Secretary regarding any discussions he may have had with the UK Government about future access to the European Medicines Agency. Currently sited in London, this will move to Europe as a result of Brexit, and, more importantly, if we lose our membership of the EMA, not only will scientific research and our biosciences industries suffer, but Welsh citizens could find themselves last in line when it comes to accessing new medicines.

Secondly, I’d welcome an update also on the city deal. It’s excellent news that the last local authority has now approved the deal. But I’d welcome an update from Welsh Government, setting out the next steps on what could be a real game changer for my constituency of Cynon Valley.

Thank you very much to Vikki Howells from the Cynon Valley. Clearly, in terms of the European Medicines Agency, this is a matter of concern but the Cabinet Secretary for Health, Wellbeing and Sport is leading discussions with the Department of Health and also with the Medicines and Healthcare Products Regulatory Agency, responsible for matters related to regulation of medicines. There’s been regular contact with the agency in terms of current arrangements for regulation, licensing and safety of medicines at UK and European levels, and we would expect to be involved in discussions leading into the future. Let’s just remember that EMA—the European Medicines Agency—protects public and animal health in 28 EU member states, as well as the countries of the European Economic Area, by ensuring that all medicines available on the EU market are safe, effective and of high quality.

Your second question on the Cardiff capital region city deal: it is excellent that the last local authority—I believe it was the Vale of Glamorgan—last week approved the deal. I very much see that this will take us forward in terms of prospects for the whole of the region, the Cardiff capital region, and for your constituency, if you look at the fact that, over its lifetime, the Cardiff capital region city deal is expected to deliver up to 25,000 new jobs and leverage an additional £4 billion of private sector investment. Of course, a key priority for investment will be the delivery of the south-east Wales metro, including the Valleys lines electrification programme.

I’d like to request a statement from the Cabinet Secretary for Finance and Local Government. A number of residents in Blaenau Gwent are concerned about reports of further hikes in fees and charges for the use of sport and recreation grounds in the borough on top of previous hikes. So, could we have a statement from the Cabinet Secretary for Finance and Local Government on the issue more generally, and especially how such hikes are compatible with the much celebrated provisions of the Well-being of Future Generations (Wales) Act 2015?

Well, clearly, this is a matter for local authorities in tough times in terms of UK Government austerity policies, but it is a matter where, of course, the Cabinet Secretary for Finance and Local Government would wish to engage and be involved with local authorities in terms of the impacts, and also to recognise that we have got real opportunities. We’ve just been talking about the city deal, but we have opportunities, I think, in terms of support, and, indeed, looking at the transitional rate relief, the extra £10 million that’s just about to make its way to our high streets as well in terms of the business rates relief fund, which, of course, we have agreed with you—with Plaid Cymru—is a very important way forward.

May I ask for a statement from the Cabinet Secretary for health on upfront charges on foreign patients using the NHS in Wales? From April this year, NHS hospitals in England will have a legal duty to charge overseas patients upfront on non-urgent care if they’re not eligible for free treatment. Emergency treatment will continue to be provided and invoiced later. There is a danger that pressure on the NHS in Wales could be increased by foreign patients seeking non-urgent treatment here, rather than in England, unless a similar scheme is introduced in Wales. Could we please have a statement on this issue?

Secondly, I’m very grateful—only a couple of weeks ago I raised this issue that Newport was getting really bad on antisocial behaviour issues. The very next day, the police in Gwent took very strong action and they did a wonderful job. I hope south-east Wales police do the same thing and clean up our cities. Could we please have a statement from the community Minister about how police are tackling antisocial behaviour and other problems in inner cities, in our south-east Wales areas? Thank you.

I think in terms of your first question, Mohammad Asghar, I have to say it’s quite horrifying to see people approaching people in beds with a machine to get them to pay up; that horrifies me. But, clearly, we have to look at our own—. We do have guidance, we have guidance in regard to overseas patients—. [Interruption.] That’s in England, of course. We have our guidance and we’re going to publish our guidance in terms of updating in due course and that’s a matter for the Cabinet Secretary for Health, Well-being and Sport to take forward.

On your second point, I believe I answered that very clearly when you raised this point a couple of weeks ago, looking at the robust partnerships at a local level within our powers so that we can ensure that we have safer communities and communities that also care for each other.

I wonder if we can find time for a debate or a statement on the construction industry in Wales, and I draw Members’ attention to my register of interests—the two unions I’m involved with have a construction interest. But, it’s following the latest data from the Construction Industry Training Board that shows that output growth in Wales is forecast to be stronger than any other part of the UK, with infrastructure projects again driving growth, that Welsh construction is set to grow almost four times faster than the UK average, with an average growth rate of 6.2 per cent compared with 1.7 per cent across the UK, creating nearly 20,000 jobs. And if we have that debate, we might have time to see how much that’s being driven solely by Bridgend County Borough Council and the two new primary schools that they did the ground breaking for last week, part of an £11.1 million funding in infrastructure, jointly funded by Welsh Government and Labour-run Bridgend County Borough Council.

Thank you, Huw Irranca-Davies. Only just a short while ago, we heard about the investment by Torfaen County Borough Council, a Labour-controlled authority, with the Welsh Labour Government. The twenty-first century schools programme is playing a huge part in terms of enabling us to have those very good forecasts from the Construction Industry Training Board, predicting strong growth in the sector in Wales. And it reflects our continued commitment to long-term infrastructure planning and investment. I think Construction Futures Wales is also very important in terms of capacity and capability, working very closely not just with CITB Wales, but Welsh companies in terms of taking this forward. And, of course, our national infrastructure commission for Wales will play a big part in this.

Leader of the house, can I call for a statement on the future of Colwyn Bay’s Victoria Pier? You will be aware that there was an announcement over the weekend by Conwy County Borough Council that an agreement had been reached with the Colwyn Victoria Pier Trust over the dismantling of the pier in order to protect it from further deterioration, after recent storms gave it a battering and caused some significant damage. That will allow the pier potentially to be refurbished and re-erected at some point in the future, but it’s highly likely that that will need the support of Welsh Government Ministers in order to allow that dismantling to take place, and potentially may need some financial support there in the future as well. Can I call for an urgent statement on that, please, in order that we can have some clarity as to the timescales by which the Welsh Government might be able to make a decision in order that this can happen rapidly? Thank you.

I think we all welcome that. It was very disheartening to see the result of the disintegration of that historic pier, and very welcome that the trust is taking that lead in terms of responsibility. I’m sure this will lead to the development of partnership discussions on the way forward.

Cabinet Secretary, can I ask for two statements today? One is from the Cabinet Secretary for environment in relation to the issuing of guidance and strengthening the guidance to local planning authorities when it comes to opencast mining, because we might be in a situation in my constituency where, once again, on the Parc Slip site, the application currently is to delay restoration. When they make applications they promise the earth, then later on in life they promise a bit of the earth because they haven’t got the money. Now, they’re not promising anything, because they say, ‘We got to delay it again’. It’s important that if applications are approved, the individual organisation is held to account for its application. Can we therefore strengthen the advice on that area, please?

On the second one, can I ask for a statement from either the First Minister or the Cabinet Secretary for Economy and Infrastructure as to what discussions they have had with the UK Government following the leaking of document information regarding the priorities placed upon industries for Brexit discussions? I understand the priority for steel is low, and therefore a major aspect of our economy in Wales is not considered important enough for the UK Government? So, can we have a discussion as to what has been said and what discussions have been going on, to ensure that steel is not at the bottom but at the top of the agenda for Brexit?

Thank you for those two very important questions, David Rees. In terms of Parc Slip, the fact that an alternative restoration scheme has been put forward at the site is important, and I understand that the details, as you say, are still being finalised. Of course, they will go to the relevant planning authorities, acknowledging your point about what impact we can have in terms of those regulations. I think it’s important to note, of course, that the Welsh Government has been clear that the UK Government, who benefited from the receipts of privatisation, should assist with the effect of restoration of the site, and I think that is, of course, crucially important in terms of the way forward. I think your point is very pertinent in terms of the importance that we place, as a Welsh Government, and indeed as this Assembly, in terms of steel when we face the daunting prospect of Brexit. I think that’s where we look to our White Paper, particularly, which does, of course, include that very clear message in terms of our priorities, economic, of course, being at the forefront, and steel being a key part of that in terms of that sector and your constituency.

Leader of the house, in response to the question I put to the First Minister this afternoon on business rates, he indicated the Welsh Government would be coming forward with the information that many Members have been calling for by the end of this week. I was hoping that maybe you could use your good offices, as leader of the house, to try and get that information in Members’ hands sooner rather than later. It is a fact that, at the end of this week, we break for the half term recess, and given the interest many Members across the parties have obviously expressed in this matter, if there were to be questions that Members would like to raise on behalf of businesses and constituents, there would be little or no opportunity to do that for at least 10 days.

I’m sure the Presiding Officer’s hearing what I’m saying, because it does seem to be a trend that these announcements are made on the eve of recess, where it does fall off the radar by the time we come back, and I think that’s a missed opportunity. It is our job to actually ask the questions that our constituents and businesses ask of us, and I fail to see why the Government can’t bring this information forward sooner in the Plenary week so that Members can ask the questions that they require, rather than leaving it to the end of the week, just like the initial statement that was brought out on 17 December, which was during the Christmas recess. Again, Members were not able to put the pertinent questions that were asked of them by the businesses in their community, as you would have seen first-hand when you came to Cowbridge and listened to businesses’ concerns in Cowbridge, when they were merely just seeking answers.

Well, I would have hoped that Andrew R.T. Davies would welcome the fact that we have actually secured an additional £10 million of rate relief for our high streets. Of course, that formed part of our final budget package before Christmas, and I hoped at the time that you would welcome it. Certainly, I had some good response in terms of that announcement before Christmas.

You also have to recognise that we’ve got a £10 million transitional rate relief scheme. Those businesses who are eligible for that will automatically get their fair share of that £10 million. In terms of the £10 million special scheme, it is a special scheme, as the Cabinet Secretary for Finance and Local Government has explained to you. The £10 million rate relief scheme is being targeted specifically at high-street ratepayers, including shops, pubs and cafes. We have to target effectively and we have to support those retailers most in need, so we’re working very closely with local authorities on the design and implementation of the scheme, and a statement will be made shortly by the Cabinet Secretary for Finance and Local Government.

Leader of the house, could we, as a matter of urgency, have times to discuss Wales’s response to the plight of child refugees in the European camps? I’ve been contacted, and I expect many in this Chamber have been, by constituents from Mid Wales Refugee Action, and other groups, who express, and I quote, their deep sadness and horror about the UK Government’s decision to limit the number of unaccompanied child refugees to Britain to a

‘paltry 350, rather than the 3,000 that Lord Dubs calculated would be our fair share.’

The Government says it is because local authorities have no space. I’d like to hear from the local government Minister and the Cabinet Secretary for Communities and Children on that specific point. As you know, the Equality, Local Government and Communities Committee is currently looking at some of these particular issues and we hope to report our findings next month. But this is actually important.

It’s interesting to note, in her recent interview with the ‘New Statesman’, the Prime Minister stated that her proudest achievement was delivering the Modern Slavery Act 2015. Yet, by refusing sanctuary, she is exposing thousands of children—the most vulnerable of children in the world—to trafficking and worse. This Chamber should have time to say and to do something about that.

Thank you, Joyce Watson. I think, in response to the first point of your question about working with local authorities, the Welsh Government does work very closely with the Welsh Local Government Association regarding local authorities and their willingness, ability and capacity to accept unaccompanied refugee children. Also, we are very much aware of placements being offered in the last week, for example, by leaders of Welsh local authorities, who are expressing a desire to take children under the Dubs scheme. But I think it is relevant to share with the Chamber that the First Minister has written to the Prime Minister today, and he has said that he wants to urge her ‘to reverse this decision’ in terms of concluding the Dubs scheme at the end of March. He says this closes a

‘vital route to sanctuary for some of the most vulnerable child refugees…I urge you to reverse this decision and work more effectively with devolved administrations and local authorities to identify placements for the affected children.’

Also going on to say to the Prime Minister and, of course, Members are aware, that

‘We are currently investing £350,000 in building social services capacity to ensure additional places for unaccompanied asylum seeking children can be identified.’

I think, finally, I would say that the First Minister says that

‘Wales is an outward-facing nation which takes its moral obligations seriously.’


‘Reinstating the scheme would send an important message about the type of country we want to be in the context of the recent hardening of attitudes towards refugees elsewhere in the world.’

4. 3. Statement: Sport Wales

The next item on our agenda is a statement by the Minister for Social Services and Public Health on Sport Wales, and I call on the Minister, Rebecca Evans.

Thank you, Presiding Officer. I’d like to update Members on the way forward in relation to the board and governance of Sport Wales. Members will recall, late last year, the decision was taken to suspend the board’s activities, following clear indications that relationships among some board members had become strained, and, as a result, it was not in a position to discharge its duties effectively.

As I said to Members at the time, the suspension of the activities was a neutral and temporary act, designed primarily as a cooling-off period in order for all of those involved to reflect, and to provide time for me, as Minister with responsibility for Sport Wales, to be briefed on the background to the situation that had arisen, through an assurance review carried out by civil servants. My overriding objective throughout, and my responsibility as Minister, is to secure a sustainable future for Sport Wales and to ensure that there is a well-functioning and cohesive organisation.

The assurance review found that a clash of cultures had developed between the chair and other board members. This clash of cultures and styles led to a deterioration in the relationship between the chair and other board members and, ultimately, to the no-confidence vote being taken last November.

I have a duty to take action when it is needed, however difficult or complex the problem. This has not been an easy process for anyone involved, and my focus has been on trying to find a strong and stable way forward for Sport Wales, its staff and the board, who are the ultimate custodians of more than £20 million of public money annually. At this point, my concern is to ensure that staff have the support they need to work effectively, and I pay tribute to their resilience over the last few months—they deserve great credit.

Because of issues relating to data protection and confidentiality, and on the basis of legal advice, it would be inappropriate for me to comment in any detail on the findings of the assurance review. I do want to make clear, for the avoidance of doubt, that the conclusions are principally related to a significant breakdown of some interpersonal relationships at a senior level within Sport Wales. There are some outstanding issues to be addressed as a result of the assurance review process. In addition, a number of formal complaints have been received by the Welsh Government subsequent to the review being finalised.

Based on advice I have received in relation to these, I have decided to take the following actions: I have suspended the chair, Dr Paul Thomas, in order for a proper and formal process to be undertaken as a result of the complaints received. I stress that this is, once again, a neutral act and in no way prejudges the outcome of the process. Dr Thomas has been informed of this development.

I have also suspended the vice-chair, Adele Baumgardt, due to separate concerns that have arisen around the cohesive functioning of the board and its relationship with Welsh Ministers. As with Dr Thomas, this is a neutral act, and she has also been informed.

I would like to see the remainder of the current Sport Wales board stay in place, under interim leadership. My officials have spoken to board members today to inform them of the situation and to ask them to carry on. From today, therefore, I am reinstating the board’s activities. This will enable a number of important steps to be taken, for example the budget-setting process ahead of the new financial year in April.

I am today appointing Lawrence Conway as interim chair. He has over 40 years of public service, with specific experience of the interface between Government and sponsored bodies. He will help to guide Sport Wales through this difficult period, and shares our key objective of restoring organisational stability. I have also asked John Taylor, the former chief executive of ACAS, to work with him in a consultative capacity in order to ensure that the board can operate as a cohesive functioning body. It is not possible or indeed desirable to give a timescale for the current temporary arrangements, but I want to reiterate the importance I place on due process being followed, out of fairness to the individuals concerned. I would like these processes to be concluded as swiftly as possible.

Looking to the future, it is important that Sport Wales as a whole remains fit for purpose as an organisation. The contribution of sport at both an elite and grass-roots level to the physical and mental well-being of our country is vital, and Sport Wales must remain at the forefront of that. I therefore want to see the review of Sport Wales, which commenced last year, completed, preferably by a member of the existing independent panel and reported to me as soon as possible. I’ll update Members further on this in the very near future.

As I said earlier, this has been an extremely difficult period for all, and I regret I have not been able today to give the certainty about the future that I would have wanted. However, what is needed here is a long-term solution, not a sticking plaster, and I need to be assured that the governance of Sport Wales is fully fit for purpose and resilient in the coming months and years. That, I believe, is an objective that can be shared across this Chamber. Thank you.

Before I reply, could the Minister please confirm who Lawrence Conway is? Is it the same Lawrence Conway who headed up Rhodri Morgan’s office? [Interruption.] Yes? Is that right, Minister?

You have an ability to ask a number of questions or you can only ask one. If that’s the only one, you can sit down.

No, it certainly isn’t. I think it has been confirmed by the Chamber that we are talking about the same person. Really, Sport Wales is just another disaster of a recurring theme of your Government, really. We have a crisis that you hadn’t seen coming and things have got so bad that you’ve had to undertake major surgery instead of resolving things at an early stage. I’ve already raised serious incompetence on the behalf of your Government earlier, adding up to £53 million. I’ve raised concerns about the allegations from Public Affairs Cymru, where your Government has leaned on voluntary organisations to stop them saying things that they don’t want to hear. The thing about Wales is that sport is such an integral part of our culture. So, if you have to get one thing right in Wales, it has to be sport. If you look at the second paragraph on page 2, I’m very concerned at the lack of transparency, and I’d like your assurance that, at some point in the near future, everything will be published. Maybe, if things are unable to be published, then they could be redacted instead of things being hidden completely.

I really must raise, as a matter of concern, the history of the chair, because, as I mentioned earlier, he seems to have very strong Labour Party connections. Concerns were raised by none other than the former Permanent Secretary to the Welsh Government when Mr Conway was appointed as a special adviser to Labour Cabinet Members in 2013, because civil servants don’t often switch between a neutral role and a political role. For many of us, this is just another example of the Labour Party card being used as the main criteria to fill a public sector post. This is the kind of nepotism that causes problems in the first place. The first question, Minister, is: why didn’t you see this coming, and why didn’t you intervene before this crisis arose? As I said earlier, major surgery. Why can’t you give us a date for when these interim arrangements will come to an end? How much is the chair being paid when he is suspended, and how much are the new people costing the public purse? And why didn’t you appoint a clearly independent person to chair the organisation, rather than somebody with such open Labour connections again? Let’s be honest: there are so many appointments undertaken by the Welsh Government where there are clear, clear political connections. Is Sport Wales carrying out its proper function? This is a really important question given the context of what Public Affairs Cymru has said: when the chair produced a report—or came out with a report—that said that the organisation needed a major overhaul, did you shoot the messenger, or have you appointed somebody who will come out with the party line instead of maybe a conclusion that you don’t actually agree with or enjoy? Finally, and certainly not least importantly, what about the 160 staff employed? Your statement offers no assurance to them, so can you please give the staff some assurance about the longevity of the future of the organisation and their place in it?

I thank you for those questions. We’ll start with the bit we can agree on, and that is that sport is very much an integral part of our life and our culture here in Wales. The role of Sport Wales is extremely important in that. A strong part of my statement today has been about the importance of the staff at Sport Wales and seeking to offer them some assurance, and to express my personal gratitude for the professionalism with which they have conducted themselves and continued working with such passion for sport in Wales over the recent weeks and months, which I know have been difficult for them. As I got to my feet today, a statement went around to all staff at Sport Wales again expressing my gratitude to them.

You asked when the concerns first came to the fore. Well, as I said in my statement in November, those concerns came to the fore in November. On Tuesday 22 November, there was the unanimous vote of no confidence passed by the board in the chair, and then I took action on 23 November, with the full agreement of the chair and vice-chair, to suspend the activities of the board until this assurance review could be completed. That, as I said at the time, was a neutral act. I think that the Welsh Government did act swiftly when concerns were first raised.

You referred to the review of Sport Wales that the chair was undertaking. The assurance review itself didn’t consider the review that the chair was undertaking or the wider effectiveness of Sport Wales as an organisation. However, the review did find widespread support for the review that the chair was undertaking. As I said in my statement, I want to see that review completed and reported to me as soon as possible, and I would like one of the members of the independent panel that was advising that piece of work to conclude that work on my behalf.

With regard to Lawrence Conway, I am extremely grateful to him for taking on this role at such short notice and at no cost to the public purse, I have to say; he’s doing it without remuneration. His credentials, I think, speak for themselves. He has over 40 years of public service experience, with specific experience of the interface between Government and sponsored bodies. He will help guide Sport Wales through this difficult period. He joined the civil service in 1968 and worked in various roles throughout his career in the Welsh Office, including a secondment to the Cardiff Bay Development Corporation in the early 1990s as assistant to the chief executive. More recently, he headed the division in the Welsh Office responsible for sponsoring a number of arm’s-length bodies, including the Welsh Development Agency, and was appointed head of the Cabinet Secretariat and subsequently the First Minister’s department in 1998. He served in that capacity until his retirement in 2010. He will certainly be undertaking his role within the context of the Nolan principles, in which we would expect all people in these positions to operate.

Can I thank the Minister for her statement today, and can I also state that I think that it is particularly important to thank the staff, who have been through a very difficult period? Many concerns have been raised by staff not of their making, and I think tribute should be paid to them through this difficult time. The organisation, as a Government-sponsored body, has been accused of being unwilling to listen, lacking transparency and being obsolete in its thinking. So, now you have had time to reflect, can I ask: do you believe that you did act early enough and at the right time, and were the correct governance procedures in place before you suspended the board? Can I also ask: can you give an assurance today to the Chamber that you think the right governance procedures are in place now and, indeed, ongoing?

Can I also ask when you expect the review to be completed and made public? Also, with regard to the chair's previous review on the effectiveness of Sport Wales—I wasn't quite sure when you previously answered this question—do you intend to investigate the structural issues identified in there as part of your all-encompassing review? I’d just like some clarification on that.

You have provided the credentials in some detail of Lawrence Conway, so I thank you for that, but I wonder if you could also provide us with some more information on John Taylor. Clearly, there’s a big task of work to do, and their ability to fulfil the roles is, of course, a question that I think we all need to have some assurance on, so, please, some more information on John Taylor's credentials.

And finally, could I ask how the business as an organisation has been affected? And by that, I'm referring to the day-to-day running of Sport Wales, but also more long term as well, especially with regard to financial planning. You mentioned it in your statement about making these changes now for the new financial year, but have some of those issues of financing with regard to the new financial year been affected as a result of the suspension of the board?

I thank the Member for those questions. With regard to the review, it was specifically a governance review, so we didn't ask the reviewers to explore those wider issues of the effectiveness of the organisation and so on. Those were issues that were being looked at by the review that the chair was leading on, and now we’ll be asking a member of the panel that was advising and helping in that works to take forward that. I would expect that work to be concluded in the coming weeks—it's not a piece of work that I would expect to go on for a long period. I understand a substantial amount of work had already been completed, and I look forward to seeing that review in due course, and, obviously, I'll be updating Members on that.

With regard to the governance that we have in place for Sport Wales, I can confirm there is a framework document in place. There's also a remit letter in place, but I intend to issue the board with a refreshed remit letter in the light of where we find ourselves at the moment. There's a Welsh Government-approved business plan in place with the organisation, and Welsh Government internal audit service conducted an audit in October 2015 and did provide those reasonable assurances that the controls are in place to ensure effective oversight within the organisation

With regard to your questions about further information on John Taylor, well, John Taylor has held a range of posts, mainly in the public sector, before serving as ACAS’s first chief executive for 12 years from 2001. His previous roles included being the chief executive of the Development Board for Rural Wales and the south-east Wales training and enterprise council in the 1990s. In more recent years, he's been deputy chair of the University of West London, chair of the careers service for Wales, the Workers’ Educational Association, and is currently chair of the major contractors committee for the electrical contracting industry. So, again, I think that he and Lawrence are both well suited to undertake this interim arrangement that we have in place for Sport Wales. Again, I would just echo the comments that you have made about the professionalism with which Sport Wales have undertaken their work as staff members in the recent period, which I know has been difficult for them, and to reassure you that there have been no issues of policy or finance that the board would have to have dealt with, but there are things now that the board will have to deal with in the very near future, such as setting the budget for the next financial year and various matters that will have to be signed off relating to national governing bodies and so on. So, there's plenty of work for the board to get back to doing now that their responsibilities have been reinstated.

Thanks, Minister, for your statement. There do seem to have been some problems at the top end of this organisation in recent months. The Minister may well recall that the last chair, Laura McAllister, stayed in post beyond her intended term of office because the Welsh Government felt that a suitable replacement couldn’t be found at that time. You then came up with Paul Thomas, but he’s seemingly quickly fallen into dispute with the rest of the board. Now, I don’t pretend to know the reasons for this, but I hope that we do get a full report on this, and, more important, that the board quickly becomes a functioning operation once again.

Sport Wales plays a key role in delivering a lot of Welsh Government targets in important areas, which could potentially increase physical activity and tackle the huge problem of obesity. So, this is the crucial thing: that Sport Wales does get on with its remit, regardless of any boardroom shenanigans or internal politics. So, echoing what Russell George was asking you earlier, I wonder if you could amplify a little bit on how the organisation has been performing without the guidance of the board in recent weeks. How has it been delivering its day-to-day functions? I know you said the budget setting hasn’t been affected, which is good to hear, but can you shed some light on, or give us some assurances, rather, that the performance hasn’t been adversely affected by recent events? Thanks.

I thank you for those questions, and I’m grateful for the opportunity to provide you with those reassurances that performance hasn’t been affected, and the day-to-day functions of Sport Wales have continued seamlessly throughout. Again, that’s due to the work of the staff who have been doing that. I’m very pleased that you recognise the role that Sport Wales has, and the potential that Sport Wales has, for so many of Welsh Government’s priorities, including the physical activity agenda as well, because Sport Wales has incredible potential to make a huge impact on both the elite end of sport but also the grass-roots end, and the physical activity end as well. I know it’s doing good work and I look forward to working closely with the board as we move forward.

5. 4. Statement: Resilient Communities—Next Steps

The next item on our agenda is a statement by the Cabinet Secretary for Communities and Children on resilient communities—the next steps. I call on the Cabinet Secretary, Carl Sargeant.

Thank you, Presiding Officer. In October I set out my vision for a new approach to building resilient communities focused on employment, early years and empowerment. This ambition flows from the Government’s core commitment to investing in the prosperity of our nation: generating new jobs, creating 100,000 all-age apprenticeships, piloting a new Better Jobs, Closer to Home project, delivering the most generous childcare offer for working parents anywhere in the UK, establishing the Valleys taskforce, creating the north and south Wales metros, giving children the best start through an extended pupil deprivation grant, and promoting financial inclusion.

Llywydd, resilient communities are ready and able to work; they offer children the best start in life—they are empowered and engaged. I want safe, strong, resilient communities. At the same time I indicated that I was minded to phase out the Communities First programme and launched a broad programme of engagement with external stakeholders. This involved an online survey and meetings with interested people and organisations, including councils and public services boards. There were more than 3,000 responses to the engagement exercise and I’d like to thank all those who participated.

The feedback demonstrated the many ways in which Communities First has benefited individuals. I would again like to thank the Communities First workforce for the difference that they’ve made to thousands of people. Respondents recognised the need for change and highlighted ways in which Communities First could be improved. A significant number felt that far-reaching reform was needed. The engagement exercise has highlighted broad support for resilient communities and a new approach focused on employment, early years and empowerment. Stakeholders also emphasised the importance of early intervention as a basic principle that should underpin our approach to building resilience. Llywydd, in light of the feedback, I have again considered options for Communities First and have concluded that it should be phased out.

I recognise the support for Communities First voiced by those who work on or have benefitted from the programme. However, in reaching my decision, I’ve also taken account of a range of other responses and factors. The Welsh Government’s approach to prosperity for all, and the policy, legislative and financial contexts in which Communities First has operated have changed fundamentally. Individuals have clearly benefitted from Communities First but, as the Bevan Foundation highlights, performance has been mixed and poverty remains a stubborn and persistent challenge. No single programme can tackle poverty. We need a holistic approach encompassing the Welsh Government, local authorities and public services boards’ members.

I know the potential impact on individuals and communities. So, I will adopt a careful approach going forward, seeking to preserve some of the most effective aspects of the work done by Communities First. I will ensure that lead delivery bodies have sufficient time and resources to plan the transition. And so, I have decided that funding, at 70 per cent of current levels, will be provided until March 2018. I will establish a legacy fund of £6 million, to be introduced in April 2018, which will enable local authorities, in consultation with communities and public services boards, to maintain some of the most effective interventions or community assets developed by Communities First.

I know how important community buildings are, too. I therefore will be providing an extra £4 million of capital funding to the community facilities programme in 2017-18 and in future years, with priority for Communities First areas within that programme, to help protect valuable community assets where renovations or alterations might help to provide a sustainable future.

We are clear as a Government that we must now transition into a new phase in our fight against poverty in Wales. Our interventions—our support for those who need it most—will not end with this programme. Indeed, our aim is to intensify our efforts to give people the tools they need to have a more equal share of the nation’s prosperity. At the centre of this must be the promise of good, secure work. So, while maintaining the valuable legacy from Communities First, I want to take forward our new approach to resilient communities.

Reinforcing my commitment to employment, I have already announced the extension of two key programmes, Communities for Work and Parents Childcare and Employment—the PaCE programme. Now, I want to go further to help create a more prosperous, secure and equal Wales. As we take forward our wider Welsh Government employability plan, led by the Minister for Skills and Science, we can develop a new infrastructure to support those furthest away from the labour market into employment.

Llywydd, from April 2018, I will introduce a grant to develop this infrastructure, building on the successes of Communities for Work and Lift. I will provide nearly £12 million a year to enable councils to enhance support focused on those people often faced with complex barriers who are furthest from the labour market. It will also allow this support to go beyond the tightly defined geographical boundaries of Communities First, which currently constrain the reach of such services. My officials continue to work closely with those leading on the wider employability plan. Enhancing and expanding employment support in our most deprived communities will be an important part of the wider employment offer.

Llywydd, investing in our children is an investment for the long term. It is the most sustainable means of building a more prosperous future. I have been encouraged by the very positive responses to date to the development of children’s zones. We will be bringing it forward, together with partners, to work with a defined community in a strategic way to improve the life chances of children and young people. I will be making a further announcement on the next steps in developing children’s zones.

Along with the Cabinet Secretary for Education and the Minister for Social Services and Public Health, I have also announced the establishment of an ACE hub to help organisations, communities and individuals across Wales tackle adverse childhood experiences, which can have such a devastating impact on children’s life chances. I will continue with the support for StreetGames in developing innovative ways of engaging our young people in positive activities. These initiatives, together with our continued investment in our successful Flying Start and Families First programmes, will ensure there is comprehensive support for children as they grow up.

People knowing and accessing their rights is crucial to building empowered communities. It is why and for that purpose I will continue to support Citizens Advice Cymru in the vitally important work that they do, helping to build resilience in the face of welfare reform changes. The reforms proposed by the Cabinet Secretary for Finance and Local Government to strengthen local democracy and the role of local councillors and support more effective community and town councils are fundamental to the development of empowering communities.

The Deputy Presiding Officer (Ann Jones) took the Chair.

Building resilient communities is the work of Welsh Government as a whole. We are committed to prosperity for all, a stronger economy that creates sustainable, quality employment opportunities and is accessible to all, delivered through a new joined-up approach that tackles individual issues through wider action. Llywydd, we will make the most of enabling and once-in-a-lifetime schemes and developments. These include city deals and the development of the metro, tidal lagoons, Wylfa, and other major investments. Together, we can build the resilient, safe, strong communities for all, and we want to continue to engage with communities and stakeholders as we move forward. Llywydd, change is never easy, but we cannot ignore the combination of new and deep-rooted challenges we face. We must have courage to find fresh ways to respond to this. That is why and what I will do, and all of my Government colleagues are determined to do so. Thank you.

Today’s statement marks the latest phase in the Labour Government’s winding down of Communities First, which was once described as its flagship anti-poverty programme. I would share the disappointment felt by many about the lack of progress in terms of reducing poverty in Wales, and I would like to add Plaid Cymru’s thanks to the existing workforce. Communities First has been a matter of some controversy. I have personally been very critical of the programme’s inability to meet its original objectives, or even to try to measure its success, or otherwise. But I wouldn’t want to see the good elements, or indeed the principle, of an anti-poverty programme disappear. Now, the Cabinet Secretary himself has accused Plaid Cymru of jeopardising this programme over several years. In April 2011, he stated that the scheme was, and I quote, only safe with Labour, and that under Plaid Cymru, I quote again,

‘we can kiss goodbye to the Communities First programme that has helped lift so many deprived areas out of poverty.’

Neither of those statements were true; they were pure spin, and now we see that it’s a Labour Government that is winding down Communities First. Unfortunately, the second part of the Minister’s statement in 2011 wasn’t correct either: the programme hasn’t lifted enough people out of poverty. It didn’t have enough resource or focus. It didn’t follow through on focusing on the communities’ priorities, and the scale and the scope of Communities First was never explained to those communities in an honest way.

Nearly a quarter of people in Wales live in poverty. That figure goes up to nearly a third when we talk about children. If this anti-poverty programme didn’t work, then the question has to be, ‘What do we do instead?’ The problems of poverty and disadvantage have not gone away. In today’s statement, no sufficient replacement scheme is set out, and frankly, that is absolutely scandalous.

The legacy fund for public service boards, at only £6 million, won’t make a dent into deep-rooted poverty issues in our communities. The extra money for community facilities is welcome, but it will be spread very thinly. What happened to your principle of targeting? An extra £12 million on skills from 2018 is simply not sufficient. It will reach too few people. None of this adds up to an anti-poverty programme to replace Communities First, and given that we’re talking about some of the most deprived communities in the whole of the European Union—communities that risk losing that extra funding that they currently get from the EU because they are so poor—now you want to take this money away from them as well.

Nothing, nothing at all, in this statement today shows the urgency with which we need to tackle poverty in this country. There is so little ambition here, and there is so little in the way of new investment or funding. Of course, we’ve got plenty of buzzwords—exactly the same buzzwords that people in our poorest communities have been sold for years. Well, let me tell you something, Cabinet Secretary: people have had enough of those buzzwords, and they have had enough of being let down by this Government. Will the Cabinet Secretary acknowledge that what he has done in this statement is to just list a number of schemes that are already happening, and will he clarify whether there will be a budgetary saving to phasing out Communities First, and if so, how much? Will he commit today to reinvesting the entire amount of money currently spent on the programme, and, finally, will he accept that what he is doing with his statement is pulling the rug out from underneath our poorest communities, giving us little, if any, assurances that there will be an alternative way of focusing on and tackling poverty? This is you walking away from our poorest communities. Isn’t that the case, Cabinet Secretary?

I thank the Member for her contribution. Clearly, she wrote the contribution prior to my making this statement, because all of the things I listed in the statement were what the Member didn’t mention. Purely politicising poverty is not the way to go forward, and the Member should know better about that. The Member started off by making reference to when I made statements back in 2011. That’s six years ago, and I accept I made those statements—you’re absolutely right I did—but just before then, her Cabinet colleagues were around the table when Communities First was being discussed and didn’t raise that issue, when that Member was also on the benches in this Chamber, so don’t start to lay blame about responsibility and what poverty is and what poverty isn’t. The Member is running into an election and hoping that an attack on us regarding this Communities First programme is something that she will gain benefit from. But let me tell the Member what she didn’t raise: the issue of Flying Start, the issue of Families First, the issue of adverse childhood experience hubs, employability pathways, childcare, the pupil deprivation grant, community assets. These are all programmes—[Interruption.]

[Continues.]—delivered by this Government, which the Member didn’t make one reference to. The fact is that she can’t make a contribution on tackling the issues of poverty because she hasn’t got a clue about it. The fact is that we are trying to tackle this very stubborn issue of tackling poverty. And I will not politicise this.

I will not politicise the difficulties that our communities are going through. What I will do is make investments in our communities with a partnership approach between Governments, local authorities and other public bodies. The Member should perhaps reflect on her statement because the content of it was just a political swipe rather than an opportunity to make a constructive statement here today. [Interruption.] She may chuckle from the benches there; she does, she finds poverty funny, clearly, but what she really needs to do is come back to this Chamber with some ideas, because the Member clearly doesn’t have any.

In drafting this statement, and your proposed or announced way forward, what consideration have you given to the Welsh Government grant-funded ‘Valuing place’ report by the Young Foundation, which was only launched in the Assembly a week ago today, based upon research with people from Aberystwyth, Connah’s Quay and Port Talbot? It was commissioned and funded by the Welsh Government. It said that establishing a local network to help encourage, train, mentor, coach and connect people together who want to take local action, whatever their skill set or resource, should be a priority. We need to allow for positive development of place that is inclusive and participatory. As I say, that included the great population of Connah’s Quay, and is a very valued report that doesn’t appear to have been—not necessarily the report, but the recommendations of that report—considered in the statement you made today.

At risk of being accused of being party political, let me say that although the annual report on income inequality from the Office for National Statistics released last month said that there’s been a gradual decline in income inequality over the last decade—UK obviously rather than Wales specific—and although the Communities First programme, according to the Assembly Research Service, has had nearly £0.5 billion invested in it between 2001 and the end of last year, it is, I’m sure you’ll agree, regrettable that the number of working age people not in employment in Wales, in the latest published figures, has gone back up to 524,000 people, with Wales ranking tenth out of 12 UK nations and regions for poverty, and with the eleventh lowest weekly earnings.

You refer to the north and south Wales metros. Could you answer the question that your colleague the Secretary for Economy, Infrastructure failed to answer last week, as to when the Welsh Government will be responding to the North Wales Economic Ambition Board’s ‘Growth Vision’ document’s specific calls for internal devolution of some matters to help close that prosperity gap that widens the further west you go in north Wales? Because so much depends on that and, simply, the metro proposed by the Welsh Government will be a sticking plaster compared to the opportunities that could be delivered with both Governments and the region working together.

You identify, rightly, broad support for a new approach, focused on employment, early years and empowerment, and stakeholders’ emphasis on the importance of early intervention. Looking back—and I’ve just heard your comments, obviously, to Leanne Wood, Member for Rhondda Cynon Taf—do you now recognise that you could have perhaps taken forward the WCVA and the Centre for Regeneration Excellence Wales’s proposals, ahead of the last Assembly election, for what should follow post 2012, which is the model that my party had proposed? We were not proposing to scrap Communities First, but simply to develop that model, which detailed proposals for a vision that would be more effective at tackling deprivation, building stronger communities, fewer bureaucracy costs, more community ownership, and where community organisations in an area would be the focus themselves for services and activities to meet local need.

You refer to the Bevan Foundation statement that performance has been mixed, and poverty remains a stubborn and persistent challenge. Well, their submission, the ‘Communities First—Next Steps’ document, which I believe was drafted by the respected Victoria Winckler, also says that Communities First did not reduce the headline rates of poverty in the vast majority of communities, still less Wales as a whole. So, how do you respond, and you appear not to have done in your statement, to her, or their, statement, that a new programme should be co-produced by communities and professionals, and not be directed top down, i.e. by local authorities, and it should be based on a clear theory of change, building on people’s and communities’ assets, not deficits, and that local action should be led by established community-based organisations with a strong track record of delivery, and which have significant community engagement, again, not by the public sector directly? Although, clearly, corporate governance arrangements would have to be firmly embedded in that.

You refer to ensuring that lead delivery bodies have sufficient time and resources to plan the transition, and the need for recognising support for those who need it most, and, therefore, that support will not end with this programme. What consideration have you given, therefore, to the submission by Cytûn, Churches Together in Wales, where they said that any changes should be gradual rather than wholesale, where they highlighted a problem with staff working in Communities First receiving redundancy notices, or leaving early, losing the most experienced and best-qualified staff, seeking employment elsewhere and being lost to those communities when they’ll be the people desperately needed during the transition period?

If I may, how do you respond to their statement that the 2012 programme, the clusters programme, actually, in terms of their evidence, led to a loss of local ownership, which, in some cases, has been critical in reducing local support and the effectiveness of Communities First and its work?

And, finally, if I may, you refer to building on the success of Communities First—sorry, Communities for Work, and Lift. Two months ago, I asked you a question and raised concern that the Welsh Government had been unable or unwilling to release data on the outcomes of Communities for Work and Lift, where it’s understood that UK Government Work Programme providers in Wales have been able to deliver jobs to the people furthest from the workplace for an average of £3,000, where it’s understood that the cost of jobs to these schemes could be up to—

Thank you, and I thank the Member for his constructive approach to the change in the programme.

First of all, he mentioned the Young Foundation programme. There are lots of think tanks and charities that offer views on how to build resilience in communities in Wales, and in England. And we look at those reports very carefully, to see how we should or could involve the good ideas that are brought forward in them. I’m grateful for the Member bringing that to my attention.

I think what we’ve moved into here is a very clear approach to the employability plan, and that’s why just under £12 million will be introduced into a delivery scheme for the clusters across Wales, where we’ll be engaging with the hard-to-reach individuals, either through Lift or Communities for Work, or PaCE. And it’s something I’m very keen on, working with other Ministers, that we can get people back into the jobs market.

I can’t answer the Member’s specific question on the issue of the North Wales Economic Ambition Board, but I will ask my colleague to look at that and perhaps write to the Member with regard to specific issues around the metro. I think the Member’s right, actually, to want to know about the metro because the metro is just one part of a jigsaw, a suite of tools, that will enable people to get into the work profile through access to modern transport systems. What we’ve got to remember, again, without laying blame anywhere, is that this is about times changing from where the Communities First programme started to where we are now, 17 years later. The whole landscape, fiscally and economically, has changed dramatically and welfare reform has had some indirect consequences on our communities on trying to tackle the issue around poverty. That’s why we are shaping a different direction.

The Member may look at Victoria Winckler’s Bevan Foundation report; he should look at it closely because, actually, what we’re proposing here isn’t that far off from what the Bevan Foundation are saying. About the employability pathway, the Minister will make a statement on that very shortly, but my part of the employability pathway is at the very front end, and we’re looking at how we get people into the education system, into the skills opportunities, and move them in to employment, which is a very important point. With regard to designing programmes with people as opposed to to people, the Well-being of Future Generations Act (Wales) 2015 is very clear on that; we will, from this statement, make a very clear commitment to go back out into those communities to talk with individuals—both workforce and organisations—that can help us design opportunities with the legacy fund as it moves forward.

Cytûn and others have made representation on the softening of the structural changes, and I believe we’ve done that. We’ve offered a 70 per cent funding model until the end of this financial year, and then, from there, we’re introducing a legacy fund. I think that gives authorities or clusters time to start shaping a different conversation about how they can develop, but that is a matter that we hope will be able to enable and empower as opposed to make sure that we deliver that process. It will be delivered from the ground. But, I think the offer here is about refocusing on the issue of how we tackle poverty, recognised by the Member that the stubborn effects of poverty are very difficult to tackle, but we are committed to doing that as a whole-Government approach.

Can I thank you, Cabinet Secretary, for your statement? What I would say at the outset is that I do understand the Government’s position on Communities First, and your concern that, of itself, it hasn’t achieved its ambition to lift people out of poverty. In some areas, it really hasn’t delivered at all. As you recognised in your statement, I think it’s probably difficult to imagine that any devolved administration can deliver any one policy that would lift a population out of poverty as poverty is also linked to the macro-economic situation of the United Kingdom, which is outwith the control of Welsh Government. Of course, again, like you’ve alluded to, Cabinet Secretary, there’s the unfair benefits system, which hits the poorest the hardest. It’s again something over which Welsh Government has no control. However, you know from my previous contributions in this Chamber and in personal representations that I’ve made to you that I have nothing but praise for the benefits that Communities First schemes have brought to my constituency. My concern in ending the scheme was that we could end up throwing the baby out with the bath water, and that much of the excellent work currently being done could be lost. So, I would like to thank you, Cabinet Secretary, for the way in which you have listened to the representations from myself and other Members.

It’s welcome that Welsh Government has recognised the real benefits that some Communities First schemes have delivered, and is putting a generous transition arrangement into place. I also welcome the fact that, during the transition period, local authorities will be able to directly prioritise those schemes that are most beneficial to the community, allowing time for them—as you’ve said in response to Mark Isherwood’s question—to refocus on what they do and to seek alternative funding streams where necessary, so that work that has made a difference in those communities can continue. I’m thinking particularly about the work around health, well-being and social inclusion. The transition period, I can see, Cabinet Minister, will allow Welsh Government time to refocus its anti-poverty priorities, directly moving the emphasis towards employability, which we all accept is the key to lifting people out of poverty, and this policy does move across areas currently not covered by Communities First.

And can I say, I very much welcomed the strategy that was set out by Alun Davies last night at the Valleys taskforce public meeting in Merthyr Tydfil, which homed in on the need for employability skills to be at the centre of revitalised Valleys communities, together with the provision of well-paid, quality, secure jobs, but also continuing with Flying Start, Families First, ACEs and the children’s zones, which you set out in your statement? So, my question, Cabinet Secretary, is whether you can agree with me that when, as part of the transition arrangements, the legacy money is allocated to local authorities, those councils must prioritise the work that successful Communities First schemes have delivered for some of our most deprived areas, and that they will be given clear guidance on how to do so, and that consideration will be given to ring-fencing this money to ensure that that happens.

Thank you, Dawn, and thank you for your question. Can I say, I’ve been lobbied by many Members, of all parties, and lots have fed in to the consultation documents? People like Dawn, Lynne Neagle, Hefin David, and many others around this Chamber have been very robust in their views of Communities First. Can I say also, I genuinely believe that the staff in many Communities First clusters have done a fantastic job in trying to tackle the very most severe poverty? And I believe the Communities First programme has probably prevented some communities from getting poorer. What it hasn’t been able to create—and that’s not anybody’s fault, but it hasn’t been able to make that big shift into making a proactive track in terms of tackling poverty head on, and that’s what we’ve got to do, and I absolutely believe that this has to be delivered by giving people employability skills, jobs growth skills, but also jobs—and I know David Rees has raised this with me in the past: giving people skills is one thing, but giving people jobs is another, and it has to be approached on a complete basis.

Can I say, in terms of transition, what I’ve tried to do here is soften that process in terms of taking a longer-term approach to change? Change is always difficult, but we need to do that. I think it’s ambitious, it’s brave, but, actually, it’s not working. The current position is what we’re trying to deliver on. So, I will be giving guidance to local authorities on the revenue legacy, to look at how their well-being plans reflect the needs of their community, but I don’t want to be very specific in terms of programme. I think it is really important that people who understand their communities better are able to make the influences of change, with the finances attached to that.

Thanks, Minister, for your statement today. A lot of the discussion today has been about Communities First; well, that scheme is now going, so we do have to ensure that any kind of programme that replaces it is going to be effective, but, mainly, today, I wanted to talk about the other side of the poverty issue, which is what Dawn Bowden alluded to: employability.

Now, you’ve previously stated, Minister, that in-work poverty is a growing problem and, in fact, the Welsh Government identified this issue when they brought out their report on building resilient communities in 2013. One thing the Government can do is to try to attract more jobs, and, hopefully, better quality jobs. Now, I know that your Government is mindful of this aspect, because your economy Minister, Ken Skates, came to the Equality, Local Government and Communities Committee last week, and he was talking about this issue, and he said it’s not just any work, it’s quality of work, that matters, and I think that that is important to bear in mind. But we are up against a number of problems in this regard. In the same week as Ken Skates’s remarks, we also had the First Minister, as I mentioned earlier today in First Minister’s questions—he informed us that the Welsh Revenue Authority was coming to Treforest, but that nearly all of the jobs were going to be taken up by people recruited in the London area. Now, I appreciate that we haven’t known forever about the Welsh Revenue Authority, but we’ve known about it for some time, so I do still wonder as to—[Interruption.] Well, it’s been mooted for some time, let’s put it that way. I do wonder why, in these situations, Welsh people can’t be trained up to fill these roles.

I don’t want to focus particularly on that, but I just want to highlight the issue of training and upskilling people. The Welsh Government is now looking to take over responsibility for procurement in order to use this as a lever of job creation. We do have some major infrastructure projects in the pipeline such as the south Wales metro and the Swansea bay tidal lagoon. But the possible outcome here is that we won’t have the skilled people in Wales and we will have to again import them. So, we may not be creating jobs for the local community at all, or, at least, not many. We could, in fact, be putting more pressure on housing supply for locals and thus inadvertently exacerbating problems associated with poverty. I know that there is a Government employability programme for upskilling, overseen by Julie James, which is touched on in your statement, but, to repeat what I said earlier to the First Minister, one does wonder what the Government has been doing about upskilling over the last 17 years, because this is not a new issue, clearly. You would know more about that than I, so, if you could enlighten me, I would be grateful.

We are also faced with other problems regarding the employment market in the shape of automation, which Lee Waters has alluded to several times. Jenny Rathbone asked last week, ‘Who will benefit from it?’ Well, it certainly won’t be the relatively low-skilled workers. So, this exacerbates the problem of upskilling. What practical things can be done to improve employability? Well, Ken Skates talked last week about using what he called ‘labour-market intelligence’ in designing apprenticeships. We do need all-age apprenticeships now, which I believe is part of the programme of employability. We do need them, because the employment market has become so fluid and there are no jobs for life now. We do, perhaps, need greater Government interaction with private industry, as the public sector is likely to contract.

Transport, I would say, is a major issue. Many new jobs are created in industrial areas on the edge of towns, often without public transport, and, of course, a lot of it is shift work. How will workers get to their workplace without a car? So, can the Welsh Government liaise effectively with transport providers? Most workers will have to work initially through employment agencies. Many of these agencies are not very good, in my experience, in communicating effectively with their workers. Often, management is poor in these agency jobs. Does the Welsh Government have any plans to work with these agencies in future? What are your plans for working with transport providers, and what are your plans for working with private industry? Thank you.

Well, the Member raised many questions there, but I think the premise of most of it was based around employability and employability pathways. I did make reference in my statement to the employability programme we are introducing: nearly £12 million-worth of investment at the very difficult end of interaction with some of our most difficult to gain market training and advantage. But, look, we shouldn’t talk Wales down. Wales is the most successful part of the UK in unemployment stats. We have done particularly well, despite the economic difficulties we face. What we have done is created many jobs, and many decent jobs. We legislated for decent jobs only a few years ago.

In terms of large projects, we do have a procurement process. There is a community clause in our programmes, where we encourage—in some cases, expect—apprenticeship schemes to be introduced. I’m sure that will be part of that whole concept around the metro and the new franchise as we talk on the issue around travel. Preparing for the future, automation is a big problem. We have to think about that very, very carefully, training and giving people the skills today for the future. We’ve got plenty of cutting-edge companies in Wales, the GEs, the Airbuses—all at the cutting-edge of technology, but we’ve got to embrace that and build upon it.

The Member raises often the Welsh Revenue Authority. Look, we’re talking about 17 very highly-skilled jobs here, and some of them will have to be brought in because of the skills base. But, in general terms, we are working with employers, we are working with our schools and colleges, to give people the right skills for planning for the future, because, if we don’t, we will be not the best in the UK in terms of our unemployment figures; we’ll be one of the worst. That’s why it’s important to change with the times and that’s what we’re doing with this programme.

This is a very sad day for Swansea East and a sad day for health, as smoking cessation, smoke-free homes, exercise classes, healthy diet and slimming programmes end. A sad day for educational attainment, as Easter exam preparation, homework clubs and family learning programmes end. A sad day for people who would have benefited from money awareness courses, utility bills advice, basic budgeting courses, and income maximisation programmes. Last year, the first supplementary budget found an extra £10 million for higher education. Will the Cabinet Secretary ask the finance Cabinet Secretary for £10 million for Communities First in this year’s first supplementary programme?

I’ve had many conversations with the Finance Minister, and a sign of the times is that we are moving into a different space of tackling poverty. The Member is wrong—quite clearly wrong—to say that all of those programmes will end. He doesn’t know if they’ll end; I don’t know if they’ll end. What it does mean is that we’ve got to talk to communities about how we make them more resilient for the future. I’m very aware of the Swansea clusters—I’ve visited many clusters across the whole of the UK—so it is rather unfortunate that the Member uses that type of language to frighten people as opposed to being constructive in the way he approaches this in the Chamber.

I’d like to thank you, Cabinet Secretary, for your statement today. In many ways, this is a bittersweet moment, and I would like to join with you and with previous speakers in acknowledging the ways in which Communities First has improved so many lives in some of our most challenging and challenged communities, but the nature and shape of poverty is not a static concept. It is quite right, therefore, that, as a Government, you should look to addressing the changing shape of poverty, and I certainly welcome the move to do that.

So, looking ahead, I welcome the Welsh Government placing employment, early years and empowerment at the heart of its new, proactive, joined-up communities policy, and also the way that the new approach ties into the employability agenda, the Valleys taskforce agenda, and the wider economic strategy. My first question relates to the issue of community assets. I welcome the commitment to a legacy fund, and the extra money for the communities facilities programme, but I would welcome any extra detail, Cabinet Secretary, that you could provide for me today on this. When Communities First services in my constituency merged in the past, this often led to a centralisation of services, with implications for the community assets that formerly housed the programme where Communities First was the anchor tenant, allowing other organisations to use the space for the benefit of the community. How will this new funding help to ensure that that kind of situation is not the case moving forward, and also will the fund that you have referred to be open retrospectively to former Communities First venues that have already lost the Communities First provision during previous mergers?

Secondly, I welcome your commitment to supporting those furthest from the labour market back into employment. However, there may be challenges here around the skills agenda, so I’d be grateful if you could tell us what assessment has been made of this, and also of any particular approaches from Communities First that could be retained in any future model.

Finally, I welcome the holistic partnership working that’s at the heart of the Welsh Government’s vision that you’ve spelt out for us here today. What response has the Welsh Government had from public services boards, local authorities and other partner organisations to these proposals?

I thank Vikki Howells for her questions today and, again, another Member that’s been very forthright in her views on Communities First for her community. Vikki, what I would say is that we should be ambitious and we should be optimistic for the future. We are absolutely committed to tackling the issues around poverty. We will have the most generous childcare pledge anywhere in the UK delivered in your constituency and constituencies right the way across Wales. Tackling the issues of adverse childhood experiences that have devastating effects on our children longer term—generational issues that are not only morally right that we tackle, but also fiscally right for public services. We need to change direction and that is what we will do, working in partnership with Flying Start and Families First and children's homes in Wales, tackling the issues that matter to us, that matter to the people of Blaenau Gwent, Rhondda Cynon Taf and Swansea, and the areas where we’ll be delivering pilots on childcare in September of this year.

The issue the Member raises around the issue of capital spend and the community facilities programme—we’ve attached £4 million to that for a four-year legacy from 2018. I expect that to be used with a degree of flexibility with local authorities, which will help them change their capital and sweat the asset they have. So, whether they need to construct new kitchens or new boiler facilities where that may enable that facility to become the new childcare facility for your area, or a place where we can deliver more training and employment agencies, these are the opportunities that I see where local authorities and local people are more at the forefront and can deliver these programmes. The made-in-Wales approach to community asset transfer is something I’m talking to the finance Minister on, and we will make a further statement on that in the near future.

Can I thank the Cabinet Secretary for his statement, and also thank him for his engagement with me as a backbencher who’s been deeply worried about these proposals, and also for meeting with my local authority? I firstly wanted to place on record my thanks, and pay tribute to the staff who are delivering Communities First in my constituency, who have done an absolutely sterling job. I know that the Cabinet Secretary is well aware of the excellent performance of Communities First in Torfaen, but just to remind him, we are first in terms of getting people into employment, second in terms of boosting skills, third in terms of improving numeracy and literacy and improving mental and health well-being. So, we have quite a track record there to try and protect. I also think that it is very important to guard against the narrative that this programme has not tackled poverty, coming, as it has, for the last nearly seven years, against the backdrop of swingeing benefit cuts, which can be dismissed by the Welsh Conservatives, but which have undoubtedly had a deep impact on our poorest communities, and which are set to get worse with the roll-out of universal credit.

As you know, I have been very clear in my representations to you, and also in my written response, that it is absolutely crucial that we do not throw the baby out with the bathwater in this programme. With that in mind, I very much welcome the fact that you will be maintaining funding for the coming financial year at 100 per cent until June, and 70 per cent until the end of the financial year. I also welcome the fact that there will be a four-year transition, but I am sure you will not expect me to be anything less than very concerned about the significant decrease in funding for that four years, which, for my constituency, will mean a reduction of £1 million per year. So, I hope that that is something that we can continue to keep under review, as it is funding for our most deprived communities.

In terms of questions, I would be interested to know some more detail on how you see this legacy fund working and how you will ensure that is targeted to the areas that can be most effective with the funding in question. But I’d also be interested to know, in terms of the employability money, how much flexibility local authorities are likely to have in using that money. Because we know that a lot of people in Communities First areas are not by any means employment ready, and a lot of the softer interventions that Communities First has been so good at are absolutely vital to ensure that they even have a fighting chance of benefiting from those employment measures.