Cynulliad Cenedlaethol Cymru

Good morning and welcome to the Economy, Trade and Rural Affairs Committee and to our evidence-gathering session with the Cabinet Secretary for Economy, Energy and Planning in relation to inward investment, and her officials. Before I invite you to introduce yourselves and state the positions that you hold within the department, I'll just call for apologies, first of all, please. We have apologies from Sam Kurtz, and Tom Giffard is replacing him today as a substitute. Hannah Blythyn sends her apologies for the first session, but will join us in the second and third sessions that we will be holding this morning. Declarations of interest, please.

Could I make a declaration of interest, please, Chair? Just to say that I know we'll be discussing the steel industry later, and I'm a member of the Tata Steel transition board in Port Talbot.

Thank you, Tom.

Given that this is an evidence session on steel, I am also a member of the transition board.

Thank you. Any other declarations of interest? No. I don't see any other declarations of interest. I'm sure that the Cabinet Secretary is familiar with the way that proceedings operate, but just in case officials aren't, the microphones come on automatically, so there's no need to touch them. And you have translation facilities available to you through the headsets, if you so wish to use them.

If I could ask you, first of all, to introduce yourselves—and I'll start with the Cabinet Secretary, then go to Heledd, then Russell—and the positions that you hold for the record, please. Cabinet Secretary.

Yes. I'm Rebecca Evans, Cabinet Secretary for Economy, Energy and Planning.

I'm Heledd Owen. I'm deputy director with responsibility for marketing, tourism and business in the Welsh Government. 

I'm Russ Roberts, deputy director for trade and invest in the Welsh Government.

Thank you very much. We've been having various evidence sessions about inward investment, Cabinet Secretary. The Prime Minister's on a trade mission/diplomatic mission to China today and, obviously, they're hopeful that they will secure trade deals from that engagement. The Welsh Government have an office in China and we've heard that, obviously, the offices play a role across the world in promoting what the Welsh Government's offer is for companies who wish to come to Wales. Can you give us a taste of the performance of those offices and, in particular, how integrated they are in the overall policy aims and promotion of inward investment for Wales? 

Yes, of course. So, each of our overseas offices operates under a clear annual business plan and, as part of that, they have key performance indicators, which include how they go about setting out a pipeline of potential investment in Wales. So, that's part of their specific role, which is undertaken by each of the offices that we have overseas.

Over the last three years, enquiries from the overseas network, which were referred through then to our investment team, saw a significant increase of 145 per cent—so, nearing 60 projects in 2024-25. Overseas network referrals, as a proportion of all enquiries, saw a rise during that period from 15 per cent to 27 per cent, and, again, I think that that really shows the importance of that channel as a source of enquiries. So, clearly, those contacts are really, really important. We have a number of offices overseas, many of which—all bar one—are co-located with the UK Government. We have an office in Brussels that is separate, and that Brussels office looks across the whole of mainland Europe, apart from those areas where we have specific offices, such as Ireland and Germany. So, the close working does take place in all of those offices.

Are those figures that you gave about key performance indicators and the business plan available to the public, and to this committee in this instance, so that we may be able to consider them? I don't think they were made available to the culture committee when they looked at Wales's international footprint, and, obviously, the offices were an important part of what they looked at.

Those annual plans would be internal documents for the team, but I'm certainly happy to explore what more information we can share with you about what we expect from our teams.

Okay. [Interruption.] Go on, Russell. 

I was just going to say that we also publish the remits of all of the overseas offices, which give an indication of their role. Obviously, whilst inward investment is a key role for them, they have other roles alongside that as well. So, there are the office remits, which are published, and we also publish an annual report on the activities of the overseas offices, which then includes their work on inward investment as well. So, those are published.

Thank you. Alun, you had a supplementary.

I certainly see no reason why key performance indicators shouldn't be published. You're subject to democratic accountability and holding you to account is what this committee does, so certainly that sort of information is essential to that. But I was interested in the earlier exchange about the visit to China that is currently taking place. I'd like to understand what engagement there has been between you and the United Kingdom Government on this, the role of the Welsh Government office in China and whether there are any organisations or industrialists from Wales involved in that trade mission.

I've had no personal engagement with that particular trade mission. As I said, our offices overseas are co-located with the UK Government's, so there would have been discussion and engagement in that space. But, unfortunately, I don't have any more detail that I can share with the committee at this point, but I'll certainly endeavour to get it.

You don't know if there's anybody from Wales on that mission.

No, I haven't seen the list of companies, unfortunately. 

It would be useful, then, if the Cabinet Secretary could write to us with some urgency on this matter so that we can return to this next week.

Could that be accommodated, Cabinet Secretary?

Of course.

Thank you.

Thank you.

The point that you made about increased leads coming through the Welsh network and the Welsh offices as opposed to the Department for Business and Trade in Westminster has been highlighted by witnesses before us. Is that because there has been a change in approach from the Welsh Government to elicit more leads, or is it just the case that the co-location points people who have an interest in Wales automatically to your offices and, therefore, that leads to an uptick in the Welsh Government picking up those leads?

I think there are two things. The first was, actually, a downward trend in the number of leads coming through the UK Government offices, although we are seeing now a reversal of that, but then also the additional work that we do in market and the increasing visibility of Wales as well through things such as the numerous trade events that we attend globally on a whole range of issues, from semiconductors to offshore wind and so on, but then some more general trade shows as well. So, when you do see Wales in those shows, we have a really, really strong presence. Our brand is really, really strong. And alongside just the presence that you have at those events, we always make sure that we have receptions on the stand. We make sure that the work's done in advance to have bilateral meetings between the businesses who we take to have a presence on our stand, but then also potential buyers and other interested partners. So, a lot of work goes on in advance of those; it's not just a case of turning up and hoping for the best. Lots of meetings are arranged in advance, and they are really lucrative. And those businesses that do attend those international trade events are almost, I think, entirely full of praise for the support that they have and the results that they get.

On turning those leads into firm commitments, it's important for the committee to try and understand, following the evidence you just gave about attending trade shows, et cetera, and how the brand of Wales being at the forefront of those trade shows is important—. Is there any evidence you can give to the committee to show how many leads actually get transferred into firm commitments and ultimately end up in investment in Wales and jobs being created?

So, collectively, the overseas team played a role in over 42 per cent of the project wins between 2022-23 and 2024-25. That's where we have the latest figures, and that's where there was an active Welsh Government involvement, creating or safeguarding nearly 6,150 jobs. So, those teams are really important. They, essentially, make the contacts, get the leads, and then they work with the trade and invest team here in Wales to translate that into actions on the ground, which can actually bring that investment in.

On the business-to-business event, it's a really important component of the marketing programme, so, things like Global Offshore Wind, Cenex, et cetera. So, the return on investment on that is between 25 and 50:1—it depends on the year—and that's to do with the deals done at those shows. So, it's a really key component of how we operate in terms of the marketing programme. And, as the Cabinet Secretary said, all of the build-out—. So, we will build marketing around that, we will build events around that. So, that is a key plank of our efforts. 

Okay. Thank you. Briefly, Russell. 

Just to add that, in addition to the overseas offices, we also have the inward investment team in Wales as well, which also goes out and provides that sort of hunter-gatherer role to try and get some of those leads coming in as well. So, collectively, there are lots of different channels through which we get enquiries into us.

But, in terms of the overall numbers, in terms of projects coming into Wales, what we've seen over the past three years is that increasing year on year. And, just last year, we had a 23 per cent increase in the number of foreign direct investment projects coming into Wales.

Thank you. Tom. 

Thank you, Chair. Following the Wales investment summit last month, the First Minister said that she was, 

'confident that in the period ahead this Welsh Government will be in a position to make further, significant announcements linked to the Summit.'

Can you update us on the progress to attract investment following that summit, and do you expect to be able to make any announcements before the end of this Senedd term?

Immediately after the summit, officials were following up leads, making contact with those who'd attended the summit, which, I think, everyone agreed was a really outstanding event. So, there's that kind of methodol—[Laughter.]

Methodology. 

—methodology working through at the moment, in terms of methodically contacting the companies who were at that event. 

So, 150 of those attendees were new to Wales. So, this was very much about them making that first contact with Wales, and us being able to showcase those specific sectors where we already know that we have expertise but we're ready to grow—life sciences, advanced manufacturing, and so on. So, we wouldn't expect immediate results from those contacts. However, I do know that there are a number of potential investments coming to fruition. Whether we can get those over the line in the next few weeks before dissolution, I couldn't say. But there are certainly some good leads that are being worked through.

Could I ask Jenny to ask her supplementary before I bring Tom back in?

In Plenary, you said that you were going to be looking for investors to help us develop a heat network in Wales, along the line of the baby steps taken in Cardiff and Newport, and I just wondered if there was anything you could report on that.

Yes. In anticipation of raising heat networks—

Thank you. [Laughter.]

—today, we have been doing the work. So, there are, I think, 13 different—. Policy 16 of 'Future Wales' sets out guidance on the development of the district heat network. So, there are 16 of those identified across Wales, but also we should be considering them wherever we have builds of homes over 100, for example. One of the challenges is the cost of district heat networks. So, we've talked before about data centres and so on. It can take 100 years for the investment in district heat networks to create a profit, so, in that sense—

We haven't got 100 years. Anybody willing to help us in the here and now?

I don't think there were any specific leads around district heat networks from the investment summit, partly because we were looking at those specific sectors around advanced manufacturing, life sciences and so on.

Okay, so nothing on heat networks. Thank you.

Tom.

How are you working with the UK Government to jointly promote Wales as a location for inward investment, particularly in light of plans set out in the spending review to develop the 'brand Wales' programme? And how effectively do you think you're working together on this, especially given the line of questioning we've just had on the China trade mission?

So, we do work well with the UK Government in a variety of ways to jointly promote our inward investment opportunities here in Wales, and part of that involves work that we do, through the UK Government, with our embassy teams. They're very active across the world, really, in terms of ensuring that we have contacts with businesses who might be interested in investing in Wales. A recent example would be that I was in Brussels for a meeting of the emerging technologies and artificial intelligence group, which brings together nations who have a particular interest in AI and the ethical use of AI. But the night before that, the embassy put on an event that involved wind energy developers from right across Europe, and that was an opportunity then that I had to speak directly to those developers and investors. So, I'm really pleased with the work that the embassy did to support our ability to engage there in Brussels with businesses from across Europe. And, as I said, the Brussels team is our only team that is located on its own. The others are all located with partners in the UK Government and work really closely in that space.

On the Wales brand, our actual Welsh brand that we have at the moment is incredibly strong. So, we don't want to dilute that in any way. What we want to do is work with the UK Government to build on that. We've actually had some recent awards, including the World Media Awards, tourism and Grand Prix winners; at City Nation Place 2025, the 'highly commended' award; some previous awards also for the Design Museum and Travel Marketing Awards; and other sources as well because our offer is so strong. And I think anyone who's ever seen those, Come to Wales and Visit Wales adverts, our Hwyl campaign, for example, will recognise the strength of that brand.

Tom.

What inward investment outcomes can be linked to the Welsh Government's diaspora engagement action plan? And how much did the work of diaspora organisations, like Global Welsh and its 'Brain drain to brain gain' report, influence your approach throughout the plan's delivery?

[Inaudible.]—that's undertaken there is taken forward through our overseas network that I've described. But since our action plan, which looked at how we engage with Welsh people overseas, there's been some really regular engagement. We've had specific events around St David's Day, for example, and we also use our social media accounts really well to engage with Welsh people overseas, and then they are really keen to share some of our Welsh stories.

We've got our three Welsh envoys, of course, who had been appointed in 2020 to drive forward our economic agenda overseas. So, there's one on the east coast and one on the west coast of America, and another in Dubai. And then they go about hosting business events, they go about using their own personal networks, which are quite extensive, to make introductions to the Welsh Government and then to support also ministerial overseas visits when they take place.

And we've also had a secondment into the Irish Government's department for foreign affairs. So, we are using that as well to learn lessons and to make engagement there to explore how the Welsh approach can consider successes from other Governments who are doing well in this space.

Thanks. Just to follow up on that, if I can, Chair. I sponsored an event in the Senedd a couple of months ago by Global Welsh, who I mentioned in my question—I note she didn't mention them in the answer—who felt that the Welsh Government hadn't sufficiently engaged with them and didn't necessarily understand the value and the potential of the work that they could do. Why do you think they feel that way?

[Inaudible.]—Global Welsh, and I know my officials have as well, and we have regular engagement with them and we're always keen to explore with Global Welsh any leads that they're able to deliver to us that we're not already engaged with. So, we absolutely value their work. They have a brilliant website, and one of the parts of that website is an opportunity for business people to connect right across the world. So, I think that the work that they do is really, really important. We are really aware of the 'Brain drain to brain gain' report; I've had the opportunity to discuss it with them myself as well. I'm just really grateful for the work that they do internationally.

Okay. Just before I ask Luke to ask his question, you said about the three envoys that had been appointed. Is that part of the £750,000 that's been allocated to the overseas office for additional activity, which is highlighted in the culture and international affairs committee?

I will double-check on that detail. I don't know if Russell's able to help us.

My understanding is that that's not a paid role in any way; it's more a voluntary-type role.

The envoy role is?

The envoy role. So, the three roles. So, they support us through business connections in markets, opening doors for us, and some of them played a prominent role at the Wales investment summit recently as well.

So, they're almost like honorary consuls as such, then, are they? Would that be a better way of describing them? Because from the evidence I just heard from you, Cabinet Secretary—I'm sure you weren't saying it to mislead me—it felt as if they were paid roles and that they were part of the office network, but that's not the case.

So, they're not paid roles, they're proud Welsh people who are really influential and just want to help. And so, they use their personal networks and so on. What I'm not sure about is the extent of any expenses that we might pay for any event that they might hold. So, that's what I wasn't quite able to answer.

That's helpful clarity. Luke.

Diolch, Cadeirydd. Just to stick with this point for just a moment on diaspora. I want to come back to Tom's question around why do you think organisations like Global Welsh—. And as critical as they are in Welsh Government's activities within this, I think it remains a bit unclear to me as to how Welsh Government is engaging the diaspora and how it is leveraging some of these other bodies, like Global Welsh, for example, and London Welsh as well, in that work. I've found it to be increasingly difficult as well to understand the Government's position. We saw what we've had from the culture committee this morning, where there was quite plain criticism of Welsh Government not being transparent on this issue. So, it's an important issue to get right. So, I'm just really wanting to press you on why you think, when it comes to diaspora policy, there's been so much criticism of how Welsh Government has dealt with it.

So, where would you see the lack of transparency?

Well, I'm just basing it on what the culture committee report has said. Trying to get Ministers in to give evidence around how the Welsh Government is spending its money on foreign offices, for example.

Sorry, I'm a member of the culture committee and it was an issue about the accountability of the First Minister that we were addressing; it wasn't simply about the office structure.

The point still stands.

I'm not sure it does. But I'll say that, as we've heard—. We've published the annual reports in terms of the work of our overseas offices. I'm more than happy, as I've said today, to share more detail about the annual plans and key performance indicators and so forth. I'm here today to answer any questions that you have on our international investment and inward investment. So, I don't think that there's any lack of transparency in that space and, certainly, if you've got detailed questions, I'm more than happy to provide written answers to those as well.

I will say, the work of Global Welsh is really, really important, and the work that they've done in terms of connections with people overseas is really important. I was really interested in the survey that they did asking Welsh businesspeople overseas whether they would like to invest in Wales. Of course, people have that longing for home, don't they? And there was a very high proportion of those who actually said that they wanted to invest in Wales. What we did ahead of the investment summit was to explore whether any of those leads that Global Welsh might have could translate into leads that we weren't already aware of through our international teams. So, we did work with Global Welsh in that particular space. I think, often, that longing for home and that keenness to support Wales and invest in Wales is there, but it doesn't necessarily match with the fact of whether that business is ready to grow, whether that business has any immediate or even medium-term plans to invest elsewhere. So, I think that the two points are slightly separate. Of course, people have that longing to support Wales and invest in Wales, but whether they're in a position to be doing that is a different question and that's not always asked alongside it.

Russell, I think you had something to say.

It was only just to add, just for the committee to be aware, that we have previously funded Global Welsh to deliver some projects in relation to inward investment in the past. So, it's just important that we say that. Also, we are in some very early discussions with Global Welsh about a potential future pilot project as well, but we can't give any more details about that at this stage, because we're still in discussion. But it was just to reassure the committee that we are still talking to Global Welsh and engaging with them.

On the investment summit, then, it was a really good piece of news that the Government was doing the investment summit in the first place, and the levels of investment that we are potentially going to be seeing as a result of that investment summit are really important. I'm just thinking about our inquiry and the evidence we gathered and wanting to get a better understanding from Government how those investors, then, would engage with the structures within Welsh Government. Because the consistent thing that was coming up within our evidence was a need for a bit of a one-stop shop, that navigating Welsh Government support would often be quite complex and difficult, on top of navigating, as well, the planning system and so on. So, I suppose the question I'm trying to get at here is: do you think that the way in which investors are able to engage with Welsh Government is sufficient enough at the moment? Is there anything that you think needs to be improved upon in that experience?

So, the trade and invest team essentially are that one-stop shop. So, the overseas network will be having those initial discussions with businesses, building up those relationships. And then, if there is an intention or a keenness to find out more about investing in Wales, then the trade and invest team will take the lead, if you like, with that particular business and then make those connections locally. They can talk about planning, they can explore what premises might be available, they can have discussions as to whether any of our economy future funds grants might be suitable. They can answer questions that might be there on skills, make connections with the colleges, to make sure that the correct courses are in place to support those businesses as well. So, in that sense, there is a one-stop shop. I do appreciate things are moving very quickly. So, we've got the free ports, for example, the investment zones, and the landscape, I think, is changing. But, in terms of a one-stop shop, that is there through the trade and invest team, and they will try and work through a named contact, in most case—you've got a relationship manager, essentially, who will try and support that business through all the various different steps. Of course, they'll have to work with different teams across Government, but I think that continuity of a single relationship manager is really important.

So, again, why were we getting evidence, then, saying that the current system isn't working in the way that it should?

So, I'd be keen to explore that evidence further. Obviously, we want to hear where we can make changes. As I say, things are changing quite rapidly on the ground in terms of investment and the scope for even further large inward investment projects. We've heard, for example—. I was in a meeting with colleagues in the Federation of Small Businesses and the Confederation of British Industry, and they were saying about a kind of concierge service that they have in some other countries, which they felt we could learn from in Wales, and we're more than happy to explore that as well.

So, just thinking about that concierge service, then, do you think something like an arm's-length body would fulfil that role, potentially? Obviously, the Welsh Development Agency is something that has been discussed more broadly, not just by parties, but businesses as well. Do you think that's something to consider? I'm just thinking as well of the business support review the Government did—again, I think that was a really important piece of work the Government did. There were conversations within that review around the need for rationalisation and a better strategic approach to business support. So, is there a role for something like an arm's-length body in that?

I think one of the benefits, certainly from an inward investment perspective, of the current system, and having our trade and invest team here within Welsh Government, is just that easy access to Ministers. I don't think that you can overestimate how important that is for businesses, especially inward investors, to be able to have that seamless, if you like, relationship with Ministers. For example, with the investment summit, we had cases where some declines were made to the investment summit, and we knew that, actually, in certain parts of the world, that personal contact is really important. So, I then attended a couple of embassies and hand-delivered two particular individuals' invitations, because that really matters in some cultures. And we wanted to demonstrate that, actually, in Wales, we understand the importance of local cultures, the importance of local respect, and to do things in that way. And then that turned those declines into attendees.

Similarly, phone calls from Ministers directly to people; again, in many countries, those things really, really matter. So, we were able to do that. That's partly, again, some of our intelligence on the ground in our different offices, helping us understand what really matters to particular businesses, in particular cultures. So, all of that worked, but I think on that broader question about an arm's-length body versus within the Welsh Government, I know an arm's-length body could facilitate things, but, actually, that closeness to the Welsh Government does matter with inward investment, in lots of ways.

You talked about two invitations you delivered personally at embassies, and telephone conversations, to promote the inward investment conference. How many conversations to actually bring people to the conference did you personally have to have, Cabinet Secretary? Because this is a critical point when it comes to inward investment—trying to get people out of the London bubble and come west. Was it a real slog to bring people to that conference, or are you just talking a handful of conversations you had to have? Is there still that resistance to people coming this far west to look at the opportunities?

No. The vast majority of invitations were through our overseas teams, but then, also, our specialist teams in the core areas that we wanted to promote. So, our team that deals with compound semiconductors, for example, they knew exactly who our targets would be globally, and they worked then with our teams in the field to make those contacts. That happened in many cases. There were a handful of people who we were really keen to get there, and, in those cases, we recognised that, actually, culturally it really matters to have that personal contact, build those personal relationships, which is what we did. It was just a small handful.

Thank you. Luke.

Just one final question from me, Chair, around some of the evidence we received in relation to challenges in providing suitable employment sites as a potential barrier for investments. What work is the Welsh Government doing in that field? We had a suggestion from Councillor Rob Stewart, for example, that used the example of potentially expanding the commercial property fund that the development bank operates. Is that something the Government would be open to?

Officials are currently in discussion with the development bank about expanding the Wales commercial property fund. Colleagues will be aware of our property development plan. That really is about unlocking those strategically important sites. Alun Davies and I talk about this a lot, particularly in relation to the Heads of the Valleys. For example, we've got our Baglan Bay site, which is possibly the most significant site that we have at the moment. Again, this is about trying to ensure that we make the most of those sites. Since I've been in post, I've increased the budget for our property development line—again, to try and ensure that we do have those sites that are ready to help businesses grow or locate to Wales. But on that point about Councillor Stewart's suggestion, that's something that we are actively looking at.

Diolch.

Jenny.

Going back to semiconductors, we heard very positive evidence of the key role that Cardiff and Swansea universities have played in providing that pipeline of skills to attract investors to come to south-east Wales, and other places, because of that. But Howard Rupprecht of CSconnected, who seems to be the points man, was calling for a long-term road map to support the expansion of these companies and to enable them to contribute to the wider regional ecosystem. What would be your response to that?

The compound semiconductor sector is absolutely one of our priority areas for our promotion efforts globally, but particularly in countries such as the USA, Japan, Taiwan. Those are areas where we already have good leads and where we've attended some of those international expos in relation to compound semiconductors.

But he's specifically asking for a long-term road map, to really enable us to build on these clusters, as well as their contribution to the wider regional ecosystem. For example, ensuring that these inward investors are introduced to existing companies in the areas they're landing in to enable them to ensure that they're getting whatever supplies they need from Welsh businesses. 

We're undertaking work of that nature at the moment, because we've got the £160 million proposal for a 10-year investment zone, which will have its focus on semiconductors. That will be in the Newport area and in the Cardiff capital region. In that sense, that 10-year plan is being developed, and it's very much about working with the areas of strength that we already have. We've got global leaders in this space, and CSconnected is clearly a really important partner in helping us. 

So, this road map is a work in development, would you say? 

Certainly, you could call it a road map or a 10-year plan, but it's definitely—

Fine. So, the 10-year plan will probably satisfy him; that's what he wants to see. Moving now to offshore wind contracts and the important announcements we had earlier this month, how confident are you that Wales is in a position to maximise the potential benefits for ensuring the supply chains are there? For example, RenewableUK Cymru gave us worrying evidence that we're lagging behind Scotland and the north-east of England in attracting investment, but also where on earth are we going to get this steel from that we're going to need for building these arrays? Actually, I'll hold that, because we can come back in the second section. How do we ensure these offshore wind contracts aren't just one-offs for extracting the wind, as opposed to ways in which we will be able to develop the economies in both Pembrokeshire and north Wales? 

In relation to the point about the number of developments that are determined in terms of planning, we've made huge changes to our planning systems recently and invested significantly in resources to support planning. In the last year, 13 applications for developments of national significance were determined. I think that shows some really significant improvement. We also reduced the average time taken to determine those DNS applications by six weeks to 30 weeks. So, some significant early progress, and this is even before some of the new investments and legislation start to bite. I think that's positive in terms of planning. That's been well received, I think, by developers. They always say that they'd rather have a quick 'no' than a long-drawn-out 'maybe', which I think is entirely reasonable.

On the point about supply chains, we had the offshore wind task and finish group, and one of the substreams of that was around supply chains and finance. Just last week, Marine Energy Wales held a finance round-table. That was able to support developers and the supply chain with information about the funding landscape and the opportunities. And the Development Bank of Wales is now looking if they need to tailor their offer more towards businesses in the supply chain for floating offshore wind to take advantage of this particular offer. So, there's work going on, particularly on the finance and supply chain side of things there.

How would you say that would be countering the evidence from RenewableUK Cymru that we're lagging behind Scotland and the north-east of England? Do you think that this task and finish group is going to accelerate the structures that we need to get that extra investment?

The work we're doing on planning will accelerate the time it takes to make a decision. The First Minister has been really clear that she wants Wales to be the fastest place in the UK to get a planning decision. We've invested millions of pounds additional in Planning and Environment Decisions Wales, in Natural Resources Wales. We've bolstered our own internal planning team. So, those decisions are coming through much more quickly now.

Okay, but specifically on inward investment, because that's what we're discussing at the moment.

I'm not entirely sure of the point that they were making, in the sense that we will deal with the applications that come forward as quickly as possible. We've got our strategic search areas, and obviously we would encourage developers to look at those search areas. We do sometimes get developers looking to build on areas that aren't within the strategic search areas, so they'll need to consider what the implications of that might be. Obviously, we've got our peat maps, which we've been doing lots of work on recently in Wales, and again, that's something that developers will need to consider. So, we are dealing with the applications as quickly as possible. Whether or not they are a positive outcome depends on—

Just on planning, if I may, we took considerable evidence from a number of witnesses who highlighted you have the national guidance, you have, obviously, PEDW dealing with projects of national significance, but there is a bit of a quagmire when it comes to the 22 planning authorities interpreting that planning guidance when they’re involved in the planning system, especially with companies that locate here and then might expand in five, 10 years' time, and it's that misinterpretation, as they would see it, of the national guidance 22 different times, which is complicating the ability to expand. Do you recognise that concern, and is there any role, because you also wear the planning cap, that can be put to make sure that local authorities have a greater consistency in their interpretation of planning advice? 

Some of the legislation does apply universally across Wales, and examples would be permitted development rights, for example, but there can be exceptions in relation to national parks, listed buildings, conservation areas as well. There is a degree of complexity, but that's done deliberately to understand and reflect local conditions. Our ‘Future Wales’ and ‘Planning Policy Wales’ do set out our national policies in respect of the economy and other matters, and so those, I think, are very, very clear, but what we do have, and rightly so, is local discretion in terms of ensuring that development is appropriate to the particular place, and it is important that there is that local discretion so that decisions can be taken locally.

So you think what we've got at the moment is a sensible approach to planning, despite, obviously, the evidence the committee has received to say that there are these local interpretations that are making confusion in the picture.

I think we do have really, really clear national planning policy through ‘Future Wales’ and ‘Planning Policy Wales’, but I also would defend that right for there to be local discretion where appropriate, so that people best placed to make decisions are able to do so within the context of their local area.

Okay, thank you. 

My final question is around the issues raised by the Industrial Communities Alliance, who are flagging up that more deprived parts of Wales have lost their competitive edge to attract inward investment as a result of the previous UK Government's decision to discontinue assisted areas, because it means that they're trying to compete with areas like Cardiff. And we saw that in our inquiry about the Cardiff capital region—that, although in theory they were trying to be pushing investment into the arc of deprivation in that area, that isn't what is happening. So, how would you respond to those concerns, and what discussions have you had with the UK Government on how we resolve this really important issue? 

We do see inward investment in all parts of Wales, and that's something that we always try to do when engaging with businesses overseas—to demonstrate actually that Wales has an awful lot to offer in all parts of Wales. We've got examples right across Wales of where businesses have decided to come and locate themselves. I absolutely understand that point about trying to make sure that investment happens in all parts of Wales. One of the challenges is, when you've got a cluster, for example the compound semiconductor cluster, that will attract other really high-value businesses within that particular field. It is one of the challenges.

Happily, it's not very far away, though, from an area of considerable deprivation, so how are we going to get them to move slightly north? 

Well, there's that side of it, but then also the other side is how do we move people seamlessly and easily to those jobs as well. So, within the south Wales metro, for example, trying to make sure that people can get easily to areas where there are—

True. We could have an hour's discussion on that, but, just taking us back, though, to the point that, in my view, the UK Government need to give incentives to deprived areas that have become deindustrialised—it's not their fault; the world has moved on—how we ensure those communities are able to get good jobs reasonably close to home is a really important social and economic issue. Is there any sign that the UK Government is addressing this, because it seems to have quite a scattergun approach at the moment? I'm not seeing a clear policy.

Feel free to speak up about the UK Government, Rebecca.

Well, I can't speak on behalf of the UK Government, Chair, but I will say UK Government, I think, has been clear in its ambitions through the industrial strategy and the eight specific sectors that it's identified as areas for growth. Some of those are areas where we really do well, and we do expect to see significant investment as a result of that. I know we're going to come on to talk about the local growth fund later, but I think that that is a space in which we can really look to focus on addressing some of these economic inequalities. And that was one of the specific things that we set out in our consultation as a priority for us, alongside improving productivity. So, certainly, from our perspective, removing those economic inequalities is a priority through the fund that we have.

But, without that assisted area status, it's going to be quite difficult to see how we're going to get people to move up to the Heads of the Valleys, where we now have the road completed, just because they're happily sitting down in Cardiff and Newport.

This is the challenge that Alun sets out for us in terms of the—

I'm sure it is.

Well, I'll invite Alun to ask his questions then, and he might elicit a response. 

You shouldn't tempt me. But there is a failure, isn't there, of strategic vision. That's absolutely clear. And it's not just a failure in Welsh Government; UK Government has failed more comprehensively, if you like, because where you've got these growth zones are where the market already delivers. And you've made that point yourself already this morning. And so, we're looking at building investment in the hotter parts of the Welsh economy, whilst not delivering the same level of investment where the market is failing, such as the Heads of the Valleys or elsewhere or parts of west Wales. So, it appears to me that the UK Government particularly, but the Welsh Government also, are not focusing public support and public engagement and public intervention in the areas that need it most.

So, again, I'd say, as an example, the local growth fund is absolutely about trying to—

We'll come to that later.

—ensure that the funding goes to areas where there is economic disadvantage. We've talked previously about that need to have a strategic approach to the investment that's been made in the Heads of the Valleys, and particularly so around things such as property, because we know the lack of commercial property is an issue. So, we have been trying to make some moves in that particular area as well.

But you haven't, have you? That's my frustration, Cabinet Secretary, because the completion of the A465 wasn't a surprise to the Welsh Government. It managed it for two decades. And the delivery of that road, which was a great achievement for Welsh Government, was not matched by any significant strategic thinking about how to maximise the value of that investment. That has to be a real strategic failure, and I don't see anyone except Welsh Government as responsible for that.

So, as I've said, we are working hard to work with the—. I know your views on the Tech Valleys programme and the Cardiff capital region and so on, but we're trying to bring those things together to ensure that the investment goes to where it's needed to create those opportunities.

You haven't spent the budget for the Tech Valleys; that's my real frustration. These are the poorest parts of the country, with the highest levels of deprivation, some of the lowest levels of economic activity, and the Welsh Government's failed to spend £10 million a year on it. Now, that is a real failure of strategic thinking. It has to be.

I share the frustration in terms of the spend that has gone through the Tech Valleys programme. It's around £40 million thus far, but—

Of £100 million, isn't it?

Yes, so far. So, I do share the frustration—

There's only a year or two left of it in terms of its original—

—in that particular space. We do need to be working, as I say, closely with the investments that have already been made. There are some really good things happening in cyber, for example. So, there are areas of strength that we can certainly build up in that particular part of the world.

But you need to do it, and that's my frustration. I accept your words, but where's the action? That's really where I am. But we are here to talk about the—

Just before Alun asks his question, could I just press a bit on this point that Jenny and Alun have been pursuing about, in effect, regional aid from the UK Government to support economic development and entice inward investment, similar to what maybe was going on in the 1990s? There were reports in the press earlier this week that the UK Government were going to reprioritise £5 billion-worth of moneys to deprived areas for the very reasons that Jenny and Alun were talking about. Has the Welsh Government been involved in any discussions around that potential reprioritisation of what is a significant sum of money, even in UK terms? Are you familiar with those press reports that were doing the rounds earlier this week?

I haven't had any of those discussions, but I will, again, write to committee as to whether or not our officials have been involved in those particular discussions.

Thank you. That would be helpful. Thank you.

I'm grateful to the Chair for that intervention. In terms of the evidence we've received over recent months, the conclusion that I'm reaching—and I want to challenge you on this, Cabinet Secretary—is that Welsh Government does a great job in bringing people to Wales. I think the work of the international office network is exemplary. I think it's first class. I think it's a great success. I think sometimes we underplay that, both Welsh Government and in wider conversation. So, that first-class work then brings these leads to Wales, and then people feel a bit let down by the support they receive when they get here.

I can think of a number of investors—and I'm particularly thinking at the moment of Ciner in Blaenau Gwent—where it appears that you come to Wales and then the public sector, because it's not just Welsh Government, you've got NRW and others as well, sets up a series of barriers to prevent that investment taking place, which makes that investment more difficult to actually realise. And then time and lethargy sort of kicks in, which means that eventually people will just think, 'I give up, I'll go elsewhere, it's easier to go elsewhere.' I'm interested therefore, Cabinet Secretary—. First of all, I presume you don't accept my assertion there, but, if you don't, I'd like to understand how you believe you're bringing these different agencies or sectors together, in the way that you said you were to Luke earlier, to deliver a seamless approach to enabling investment to be realised.

I think, in fairness, the decision around Ciner was more in relation to global factors than any support or lack of from Welsh Government.

Brexit was a part of it, I accept that. But, even without Brexit, there was a significant failure from the Welsh public sector to deliver the sort of enabling environment that the company probably required.

So, one of the most important things that businesses say that we can do in terms of that enabling environment is a more streamlined and better planning system. Of course, we've got the new Infrastructure (Wales) Act 2024 coming in now. In December, some of those provisions came into place. Those should significantly make it more streamlined for developers here in Wales. But then also we've worked to ensure that local authorities can now move to full-cost recovery for planning. Actually, businesses said that they were very comfortable with that, if it meant that they got an improved service. So, again, as of December, those new regulations came into place and we are moving now towards full-cost recovery for planning.

Local authorities have said that they would reinvest those moneys in the planning services to bolster them and ensure that they can deal with things more quickly. We work on a relationship of trust with local authorities in the first instance, and we understand that they will do that, but we have also said that we're reintroducing the planning and performance framework for local government as well, to ensure that the increased funding that they'll get now, which will be the biggest investment in planning services financially, actually translates to improved services for businesses and for others as well. So, all of those things are coming into place.

We've also been working to ensure that planning can take place, where necessary, on a regional basis to support business. So, we've done some work through Net Zero Industry Wales in north Wales to support two new planners with specialist skills to support some of those larger developments coming to Wales. We've had a proposal recently for something similar in mid Wales, because they've seen how important it's been in north Wales, so I'll be considering that, and I've invited other proposals from other parts of Wales for that kind of shared service in relation to specialist planners for business and industry as well.

The fact that you've got to do all of this—and I recognise that you have been doing this, by the way, Cabinet Secretary—the fact that you've got to do all of this demonstrates to me that there's something fundamentally broken in the governance of this country, if I'm quite honest with you. Because you shouldn't have to create all these different mechanisms in order to achieve relatively simple and straightforward outcomes. There should be a far more streamlined sense of business delivery within the Welsh public sector. I use that term because I don't—. I think, as a Government, of course, you are responsible for all of this, but it's not just within Welsh Government, is it? There is a fragmentation and layering of bureaucracy that is actively preventing business investment in Wales, or certainly slowing it down, across the whole of the Welsh public sector. And that's a really serious issue, and we've heard this from different sectors, from trade organisations like the Confederation of British Industry, from academics who've been comparing Wales with other administrations elsewhere. And I see it, and the reason I think their evidence is secure is because I've witnessed it myself as a local Member, and this is why I keep coming back to you about issues like the reorganisation of local government, about the wisdom of abolishing the Welsh Development Agency, and how we have a culture in Wales that enables businesses to build and develop and invest, rather than places barriers in front of them. And the fact that you've got to do all this work in order to achieve a relatively short and simple outcome tells me that we've got to re-engineer the way we deliver business support in Wales.

I think some of the work that we've had to do—. I was specifically talking about planning because that's so critical for business. 

Yes, I recognise that.

Some of that is because of all of those years of austerity and it was the planning teams that were decimated—

That's not austerity, it's governance. I'm not going to let you get away with that. It's not austerity; it's about the structure of governance as well.

So, on planning pressures, I think that austerity had a significant role to play in that space, and, actually, we've asked the Royal Town Planning Institute, commissioned them, to do a piece of work looking at the planning services across Wales to understand where the pressures are. So, that report will be out next month, but I don't think there will be any surprises in it, and it does talk about the way in which those services were decimated, if you like, over a number of years. But, as I say, we're taking action to resolve that now, so businesses should see an improved service.

I defer to nobody in my criticism of austerity, let me tell you this, but I don't think you can just walk away from these really significant challenges either.

No, and I understand that the points that you're raising now are big, structural issues. There are very many views on local government reform and so on—

I'm sure we'll have a conversation.

And a few weeks out from the dissolution of the Senedd—. I don't think we'll have time to perhaps put in place Alun's plans between now and then, but—

But they're not Alun's plans, are they? They are the criticisms of almost every witness we've had in front of us.

And these are important things for Government to think about, but, obviously, for all of us as we start to think about the future.

As we write our manifestos. Thank you.

One final point, if I may, Cabinet Secretary, on skills in particular. We've taken evidence about the ability to work with companies, when they come to locate in Wales, about developing a skill base, especially in vocational skills. Now, we know full well that the Welsh Government have had a priority around apprenticeships, but that priority was downgraded from 125,000 to 100,000 apprenticeships for this particular Senedd term. There was an interesting article from Medr last week in the press, highlighting how the budget settlement—and I appreciate that it's about choices at the end of the day; there's a limited amount of money—would be about £25 million short going into the next academic year, and so that would mean that there were fewer apprenticeship starts available in further education colleges. Do you recognise that pressure, and what representations have you made to try and increase the apprenticeship budget to meet the demand?

I've been really clear—I think it was to this committee actually—that if there was additional funding available, then employability and skills and apprenticeships would be the priority for that. So, you did see, then, in the final budget that we were true to our word and that, when we did have some additional funding from the finance Secretary, we did put it into employability and skills. I think 100,000 apprenticeships over the Senedd term is an incredible achievement, and 200,000 apprenticeships over 10 years within a population of 3 million people is really, really significant. The First Minister said that you're more likely in Wales to meet a person who's had an apprenticeship paid for by the Welsh Government than a person called 'Evans', which I think is quite significant in a country like ours. Our investment in apprenticeships is really, really significant, and the fact that we're trying to align those apprenticeships to skills that we need and the opportunities that we see through the industrial strategy, through our investment internationally—

I recognise that, Cabinet Secretary, and the £5 million extra that was allocated in the final budget. But Medr are quite insistent on this point, that, obviously, the resource doesn't meet the demand. Do you recognise that fact, that there isn't enough resource? It's for obvious reasons—there's only a certain amount of money that can go around. I appreciate it's a difficult balancing act and that to meet the aspirations and to fulfil the sector's wishes to provide more apprenticeships, more resources are definitely going to be required.

The Welsh Government's spending more now than we ever had on apprenticeships. Of course, Brexit was a significant issue in terms of how we were able to support apprentices. Of course, if there's more funding available for apprenticeships, I think it's always money well spent, and I and Jack Sargeant will always advocate for additional funding for apprenticeships.

Okay. Thank you, Cabinet Secretary. That concludes the questions in this particular session. We'll now move into private session while we move the deckchairs around, and we'll resume at 10:40, if anyone wants to get a coffee or take a comfort break.

Good morning and welcome back to our second evidence session with the Cabinet Secretary for the economy, on the steel industry. I'm going to do my usual invite to the Cabinet Secretary and officials to introduce themselves and state their position within the Government for the record, and then we'll go into questions. Cabinet Secretary.

Rebecca Evans, Cabinet Secretary for Economy, Energy and Planning.

Aine Gawthorpe, deputy director, industrial transformation and foundational economy.

Neil Surman, deputy director for skills.

Thank you. Cabinet Secretary, we're seeing building going on at Port Talbot at the moment, with the new arc furnace taking shape there. How confident are you that the building work is proceeding as planned and will be operational by 2027?

We speak to Tata regularly, and they are confident that the electric arc furnace will be ready for operation at the end of 2027, in line with the commitments that they've made. We know that the major contracts are in place, and work is already well under way now on the site in terms of preparing it in readiness for the installation of the electric arc furnace. The building where the EAF is to be housed is currently being stripped out, and piling is starting across the site, and there's also the construction of a contractor village. That's been undertaken and staff are already moving into that.

The upgrade to the electricity connection, through a new power line to power the EAF, is being undertaken by the National Grid, so they're working really closely with Tata to ensure that the overall timeline is met as well. So, things look really positive. Tata are confident that they'll be working to timetable.

And the jobs to be created, are those still on target and in accordance with the commitments given?

Yes. Tata's appointed a number of contractors. So, Tenova are installing the electric arc furnace and the related steel-making equipment. Sir Robert McAlpine has been tasked to manage the main civil, structural and building works for the EAF construction, and then Bridgend-based Skanska will deliver civil and structural engineering project-management services. We previously welcomed the news that Tata was working in collaboration with local companies—so, Darlow Lloyd and Sons, Wernick Buildings and Andrew Scott Limited. So, that will secure 300 skilled jobs as part of Tata's transition to the electric arc furnace. There are other current investments under way as well. These include a major contract with JASO Industrial Cranes and the new pickle line at Port Talbot, which is expected to create 250 jobs for local people during the construction phase. And there's investment in the new acid recovery plant also under way, linked to the pickling process. So, I think that that news should give confidence to the local community, but also I think that the fact that people can see things happening on site and that Tata is confident in the timeline is positive.

Talking of future investments, people have talked of a new plate mill and direct reduced iron plant. I appreciate we're seeing the arc furnace and its associated developments taking shape now. Are you able to give the committee any assurances around Government engagement about future development and future prospects for the plant, in particular about those two projects that I highlighted to you?

Yes. So, officials and I are in regular discussion with Tata, and we always take opportunities to explore what future investments might look like, but, understandably, the company's own focus at the moment is very much on delivery of the £1.25 billion project in terms of that new electric arc furnace. Tata's made it really clear that any decisions regarding a plate mill, for example, would need to be based on a clear assessment globally of market demand. It doesn't presently intend to reopen the plate mill, but it does remain open to future investment opportunities at both Port Talbot and its downstream sites, but, again, it's very much focused at the moment on delivery of the existing project.

The Senedd outreach team did an engagement with the local community and, indeed, some of the wider communities. Obviously, the comments that came back were quite damning, to be honest with you. The community felt very let down. In some of the comments they talked of how, 'Our community was let down', 'Our workforce was let down', 'Our way of life has gone'. And then another comment was that 'They'—being the Government—'promised us the world and delivered nothing.' Do you recognise that sentiment that the engagement team picked up from the interviews, and interviews that they did with various aspects of the community around the steelworks and beyond?

I absolutely recognise how difficult this period has been for people who were employed at Tata and the huge change that there's been. So, that comment, 'Our way of life has gone', I think really does resonate, and we will do absolutely everything we can to support that community. We've been working really closely with Tata, with the local authority, and with the UK Government through the transition board to try and ensure that there are opportunities for people following the closure of the blast furnace. 

We have got some really good examples of ways in which people have used their redundancy money, for example, or used the grants and loans that they've been able to access to set out on the routes to further employment. We can share some of those case studies with you. I won't go through them all now, but examples include one person, Levi—they used their redundancy package to set up a new pizza business. And then we've got Cassius, who used a regeneration loan to set up Portablo Coffee in Aberafan shopping centre. Anthony has been working on HS2, and they used their transition board funding to pay for upskilling to be able to do that. And Martin, he was introduced to a range of training courses, which led him then on to gaining an education and training qualification and mental health first-aider status. And he's set up his own company now, offering training to employees and employers in the area around mental health. So, there are some really good examples of ways in which people have taken advantage of support that has been available and have been able to create new enterprises for themselves. But none of that takes away from the huge shift that has been seen as a result. And that point, I think, about 'our way of life has changed' is one that we absolutely recognise.

I think, accept the point about way of life—. Such a massive change, with so many people losing their job at a certain particular moment in time, is going to be catastrophic for any community, it is. But when you get—and this is the outreach team doing this, so this isn't politicians going out into the community; this is the outreach team doing it—that type of feedback, where people are saying, 'They've done nothing', yet you can give us hard-and-fast examples there of, hopefully, success stories, of people being able to rebuild their lives and their careers, would you accept that there's obviously a breakdown in communication about what's going on at the plant now and the new facilities that are coming online to create new jobs, but also the retraining and the new opportunities that have evidently been made available to people, who obviously thought that they would have a lifetime at the steelworks, but ultimately have benefited from some of the support that's been put in place by the transition board? There clearly is a breakdown in that communication about what's going on.

I think, inevitably, there's going to be that anger and that upset. And part of that, I think, is around the way in which the workers didn't have that just transition to the electric arc furnace. So, the previous UK Government wasn't able to come to an arrangement whereby it would agree the multi-union approach, which was what we were in support of in terms of trying to have that smoother transition. But we have to deal with the situation that we have and we have to put the kind of support in that we can.

I will say that, when you look at the Department for Work and Pensions statistics—they are reported to the transition board on a regular basis, and so the most recent figures that we have were from October's meeting—there continues to be no significant increase in the volume of applications for unemployment benefits reported by DWP. So, that does suggest that many individuals are managing to find alternative employment or are becoming entrepreneurs in their own right, which I think is positive and it does speak to the success that we are having in terms of supporting the affected workers. None of that takes away from how difficult this is for everybody.

Thank you, Cabinet Secretary. Tom.

Thank you. Moving on to the transition board, how effective do you think the support provided by the Welsh Government and the transition board has been for those affected by the Tata job losses, and why? What programmes do you think have worked best, and which do you think haven't worked as well as you might have hoped?

I do think the support has been effective. What we don't yet have is the data that we need to provide a proper evaluation. That will become available at the end of the financial year. Neath Port Talbot are the holders of that data in terms of the impact that the various interventions that we're having are making—the support for individuals but then also the support through the Business Wales service. As those funds are still operational, we can't really talk about lessons learned or what has worked more than other things, but we can look at the DWP data and the individual case studies that we're able to access, and of course the work that's happening in the Community hub as well, which I think has been really, really critical in terms of providing support for the community across a whole range of areas. I'm really grateful to Community for the work that they've been doing. I think that they've had over 3,000 people through the door at the Community hub, and they've been able to get support to look at other sources of employment.

We've been working really closely with businesses right across the region, actually, to explore whether they can take on staff from Tata. One example would be the Onllwyn rail training programme. That's been funded by the Tata transition fund, and that retains 72 ex-steelworkers so that they're able to transition into the rail industry. So, there are specific businesses and initiatives like that, which are also giving opportunities. And actually, when I visit businesses in and around the Port Talbot area, it's rare that I don't come across businesses where they will tell me proactively that they've been able to employ former Tata steelworkers as well. So, it has been a huge effort, I think, from businesses locally to explore what they can do proactively to support affected workers.

Can I let Alun ask his supplementary, please?

When I look at events in Port Talbot, I look at them through the lens of Ebbw Vale, clearly, and I still see the impact of the closure of Ebbw Vale steelworks in the constituency today, 20 years later. And I'm concerned about the human impact of the changes and the job losses in Port Talbot. I'm interested in what you say about the training, and my question is: training for what? One of the issues we faced in Ebbw Vale was that you had the loss of jobs when the steelworks finally closed and you had some support—not dissimilar, actually, to what's being provided here in Port Talbot—but of course what you didn't have were the jobs and the opportunities, then, for those people who had been receiving training to actually move into. So, what we were doing was delivering a great deal in terms of the supply side, but what we didn't have was anything, then, for those people to actually use the skills that we were providing.

We're trying to ensure that the skills opportunities provided do lead people into meaningful employment, and examples would be through the work we've been doing alongside the Wales union learning fund. So, through the steel unions, we've supported over 700 Tata and supply chain workers to build skills in a range of areas where we know there is demand, including engineering, forklift truck operating and health and safety roles. But crucially, our personal learning account has been really important as well. That’s supported over 1,000 Tata and supply chain employees to access over 1,300 learning programmes, and those are in areas such as logistics, construction, engineering, project management and digital skills. All of those are fields where there is demand for those particular roles. Of the 59 ex-Tata and supply chain employees supported through ReAct+, we've been able to provide skills such as, again, transport and logistics, construction-related courses—there’s huge demand there—and digital and security-related training. So, there is a concerted effort to not give people false hope and waste people's time, but to give people skills that they can then translate into employment.

Tom.

Thank you. You will obviously be aware that Luke and I sit on the Tata transition board, as I mentioned earlier. One of the things I think we mentioned in our first meeting, which I appreciate predates you sitting on the transition board, Cabinet Secretary, was about the need for this to be a transition board, yes, that serves the community of Port Talbot, but the wider workforce as well, which lives across a much wider footprint. Now, the committee heard from staff at the community support centre that workers who live outside Port Talbot have faced barriers to accessing support. So, what discussions have you had with the transition board, or others, to address those sorts of issues?

So, we really recognise that point that support has to be there for workers who are affected, including those who live in my own area of Swansea, but there'll be others in Bridgend, and further beyond as well.

We do know that Business Wales, of course, manages all of the enquiries and the initial business advice for the start-up fund. So, 44 per cent of all initial enquiries have actually been from outside of Neath Port Talbot. So, I do think it's positive. It demonstrates that that fund is being accessed by workers and the supply chain more widely. 

Okay, thank you. How do you respond to concerns from representatives of the Tata multi-union committee that there have been missed opportunities to deliver retraining in the,

'foundation skills of mechanical, electrical, welding, bricklayers, plasterers', 

much of which are needed in the local area and could have led to greater local business investment?

So, I think that speaks to the answer that I gave to Alun Davies, in the sense of trying to ensure that the courses available are meaningful ones that will lead into future employment. I've mentioned construction, for example—that's going to be hugely in demand in Port Talbot and the surrounding areas—and then, obviously, digital is an area of growth right across the Welsh economy. 

Clearly, though, I think that speaks to a kind of wider question about gaps within the workforce in Wales. So, one of them that I'm particularly concerned about that we need to address, or two, actually,—. One is around welding, and one is just engineering more generally. So, I'm keen to explore what more we can do, with Medr and others, to try and ensure that opportunities in those particular fields are increased. Because we know, with floating offshore wind, with new nuclear, welding skills are going to become particularly important in future, even more so than they already are. 

So, we've got a ministerial board on vocational and tertiary education, and we met yesterday, in fact, to look at how we maximise opportunities through some of the recent announcements, including the defence growth deal, the new announcements on floating offshore wind, and we touched on nuclear as well. And so we'll be working, again, to look at what we can do to provide more opportunities for people to get those skills that will be crucial to the success of those projects. And doing what we always say we want to do most, which is retaining the value of these large-scale projects, as far as we can, in Wales. 

Thank you, Chair. 

Okay. Jenny. 

I want to pursue this a little bit further, because I can recall vividly the evidence we had from the local representatives in our one-day inquiry on the transition board. And Ian Williams told us that Tata rushed through the redundancy strategy, throwing money at the problem, but missed the opportunities for retraining while they were still in work, so that they could have trained people in the foundational skills that you've just been talking about that are vitally needed to attract businesses to the locality, as well as pick up on all the things you've just been saying. But it didn't happen, and they were then scattered to the four winds, and, as elsewhere, instead of building on the skills they already had, they're doing goodness knows what. A huge missed opportunity. At the time, do you recall having any discussions with Tata about training people, once the decision was announced, and having a programme of actually training in Tata, to ensure that all those skills were going to be upskilled and then retained in the area?

So, I might ask Aine and, potentially, Neil to come in on this particular point, because I know that they were involved in this long before I came into portfolio. 

Okay. 

So, what we were having reported in conversations with Tata was the focus on, obviously, the redundancy process. And a lot of that was actually about identifying opportunities to retrain, reskill and retain some of those workers within the company, so—

But they didn't. 

So, there was quite an extensive process of job matching for those individuals who were interested in moving into different roles. And some of that was what was reported as actually slowing down some of the redundancy process. So, some of the consultation process took a little bit longer than people were anticipating, and what the company were reporting was that was because of that whole process of trying to job-match people into other roles and then train them and skill them within those roles.

That sounds like an excuse. What the workforce representatives are saying on the ground is that this didn't happen and it should have happened. But, obviously, Tata is an independent company. They were talking the talk but not walking the walk—is that correct?

I couldn't comment. Obviously, that's the feedback that you've received. Those were the conversations we were having with the company.

Well, somehow, we need to resolve this, because it's incredibly important that we don't lose those skills, as we have done elsewhere. We're simply repeating history as to what's happened in other places. I find all that very, very depressing.

So, just moving on to the steel strategy that we are expecting to get this week, is that right, from the UK Government—what have you asked for, Cabinet Secretary, to be included in the UK-wide steel strategy? And what evidence is there that they've taken your views on board?

So, I think that the steel strategy is delayed at the moment, so I don't think that we're expecting it to be published this week.

Okay, so when are we expecting it, then? Do we have any—?

We don't have a date yet, unfortunately.

Nobody has any idea?

No. We don't have a date.

We don't have a formal date as yet. We've been told that it's been delayed, that the write-around process has not yet commenced, so we don't have an indicative date.

Okay, obviously, that's—

Just for clarity, there—. Sorry, that dropped off there. The write-around process hasn't even begun yet?

I don't know the details, but we we're told that the process is still ongoing, so we don't have a date. Our engagement with DBT colleagues just indicates that it has been delayed at present. We don't have a date by which we expect it to land.

Okay, thank you.

Okay. It's difficult for you to comment, obviously, on something that hasn't yet been delivered—

I can talk about the kind of things that we would want to see addressed in the steel strategy, and the things that we've been saying to the UK Government, in terms of the steel strategy, have been very much about what businesses have been telling us. Competitive electricity pricing structure—that's obviously the top thing that's being raised with us, frequently, and then greater leverage for using UK steel through public procurement. Again, that's something that is raised, alongside robust trade remedies. So, I've already written to UK Government and raised concerns about the tariff and trade situation that the Welsh steel industry is currently facing, and we've also talked about the importance of investment in research and development as something that we want to see. We've got real expertise here in Wales, particularly at Swansea and Cardiff universities, so they're really well placed to get involved in that R&D, so we think that should be a really important part of the strategy. As of course is scrap, because that's going to be, obviously, critical to the decarbonisation of the steel sector. So, those are some of the important things that we've been asking to be addressed in the steel strategy.

Just sticking with scrap, the circular steel sub-committee's recent report calls for investment in the whole process of domestic scrap processing, such as shredding, screening and refining, and we heard concerns from the workforce, when giving evidence on the transition board, that that downstream and upstream investment isn't taking place, and Tata is silent on this matter. That means that we could have the electric arc furnace back in action, but then all the subsequent process is going elsewhere to be refined into product. Is this something that has—? How are we going to resolve that? Because if Tata are refusing to think about the whole-system approach, then we're just going to be a very small part of the process, and then everything else goes elsewhere.

So, we've had a specific meeting of the steel strategy council looking at scrap, and the UK Steel Council has also set up a working group, which is looking at a particular strategy for scrap metal. So, we're keen to be a member of that group because, for the reasons that Jenny set out, there needs to be a more focused scrap metal market here in the UK.

The UK currently is a net exporter of scrap, which is unlike most countries in Europe, and, obviously, it's going to become more important here in Wales, with both Wales-based steel producers making steel through scrap by the end of 2027. So, we're really keen that that strategy is a wider strategy that looks at the kind of wider issues that Jenny's raised as well, rather than simply looking at the availability of scrap itself.

Okay. Well, obviously, it's very important that we do recycle steel into new products, but it doesn't resolve the issue that I wanted to ask earlier, which is: where are we going to get the steel that's resilient enough to support these offshore windfarms, which isn't going to be coming from scrap, is it?

So, we would need to talk to developers, obviously. The problem that we have with floating offshore wind and offshore wind generally is that these are already pre-existing global supply chains, in a sense. If only it was a case that we could start from scratch and do everything here in Wales. What we've been trying to do is map out the components where we see the gaps in those supply chains. There's been work going on through the task and finish group on floating offshore wind, where we had a specific stream of work looking at the supply chains. So, trying to identify areas where we've got expertise or where we can do more, and then also working with the Crown Estate. They've got a fund worth hundreds of millions of pounds for the supply chain for offshore wind. So, making sure that Welsh businesses can benefit from that funding, which can then enable them to be part of those supply chains. We think that that's somewhere where we can really add value here in Wales.

Okay. But with just 30 per cent of UK steel demand being met by UK-produced steel, we clearly have quite a major steel security issue in light of the uncertainties in the world. What is the Welsh Government doing to increase the amount of UK-produced steel that is used in Welsh infrastructure projects? For example, you mentioned the possibility of using public procurement.

So, we've got a Welsh procurement policy note 008, and that aligns well with the Well-being of Future Generations (Wales) Act 2015 and the Procurement Act 2023, and also Welsh regulations and our Social Partnership and Public Procurement (Wales) Act 2023. And the alignment there really is to try and ensure that we have sustainable procurement, and it does include early engagement with steel producers to strengthen the domestic industry and also to reduce carbon emissions. We're also working to ensure that that procurement note aligns well with the UK Government's recent note, which is about procuring steel in Government contracts. We do intend to revise our own procurement policy note, detailing the approach where projects up to a value of £3 million—. Sorry. Projects with a value of £3 million and above will have to take account of that.

The intention is that Welsh contracting authorities then will have to consider how and when steel inputs will be procured throughout the supply chain. That will give better visibility on the supply chain for the steel sector, but also for the supply chain, to ensure that there's better ability to plan. And also, critically, with the new procurement legislation, procurers will no longer have to assess—. Procurement will no longer need to be assessed based on the most economically advantageous tender, but the most advantageous tender. And I think, within that then, you can make strong arguments around the importance of supporting steel security, of procuring locally. So, it does allow you to take slightly different choices in terms of where you procure steel from. So, I think that the procurement updates will certainly help in this space.

Does that address, that change in direction—? Does that address the issues that British Steel, for example, have been highlighting when it comes to green steel, and blast furnace steel meeting the green credentials on public procurement? I know they've engaged with your officials and, I believe, yourself, and they've engaged with members of this committee as well. So, does that make it easier to purchase British Steel products for public procurement? Because, at the moment, it's pretty debatable how green the steel that's coming from third countries is. So, I'd just be grateful if you could clarify that.

I know that officials met, at the end of December, with British Steel to look at ways that we could support the use of domestically produced steel whilst also adhering to our carbon reduction principles. I'll ask Aine to just provide a quick readout on that meeting.

So, British Steel have asked Welsh Government to consider relaxing our carbon targets on public sector building in Wales because of concerns around the procurement of steel from outside Wales. We've had conversations with them, and we're also working to understand how much of that is being driven by, potentially, embodied carbon targets, and how much is actually driven by other issues such as pricing challenges and decisions around cost. But we will be working with them. We met with them before Christmas, and we're going to be meeting with them again over coming weeks, to look at what could be done. Some of that could be through enhancing the guidance to make it clear that our embodied carbon targets don't apply to specific materials, but actually to the entire building. So, there are other ways of offsetting our carbon requirements other than just buying EAF-produced steel, for example. So, we're looking at how we can do that.

We're also looking at how we need to focus on the use of various different types of product during construction, be that blast-furnace-produced steel, EAF steel or timber, for example, and how we can look at proportions of that to ensure that we have a sustainable supply chain for those constructions. So, the conversations are ongoing, but we're actively working with them to see how we can support and how our procurement notices and guidelines will actually help alleviate some of the concerns.

But our overall steel security is pretty precarious, is it not? I assume this is being discussed by the Prime Minister in China. But if we're going to be dependent on steel coming from the other side of the world, in uncertain circumstances that we don't want to rehearse here, we are in a very fragile position, are we not?

We're aware that the UK Government have a commitment to increase the proportion of steel that is used in the UK that is UK produced. Clearly, the sovereignty of our ability to do that is important, but there are many factors involved in that, not least of which is pricing.

But without the blast furnaces in this country, we may not be in a position to build the bridges, the high buildings and, indeed, the offshore wind, because only those are strong enough to keep up safely.

Do you recognise the figure that Community, the union, put to this committee, that public procurement now represented only a third of British steel, whereas, historically, it was as high as two thirds? So, do you see that, whilst we hear you saying about public procurement, there's been a huge suppression of purchasing of British steel, to the detriment of the production base here, and, obviously, filled by third party quotas?

Well, I can't speak to those particular figures, but, obviously, I will explore those.

It's in the record it is.

I take the broad point, absolutely, which is being made, which is why moves that we've made, through the recent Procurement Act—. So, colleagues will recall that we worked with the UK Government on that particular Act, because we felt it was something, and contracting authorities and businesses said it was something that they would like to see operating and legislated for across England and Wales. But then, that does allow us to look again at our own policy, our procurement notes.

So, I've referred to one of them, and I'm just looking at some more notes on this. Actually, we've got a note for supplier selection, and that does say that Welsh contracting authorities should use pre-qualification questions

'to tackle the problem of steel dumping and non-compliance with acceptable standards of health, safety and welfare and environmental standards.'

'The nature of steel production is such that compliance with social, labour and environmental law outside of the UK and EU is a significant issue',

and contracting authorities can use that as a differentiator when selecting suppliers. So, again, that's something that I think would be welcomed by steel makers based here in the UK.

Okay. So, I want to move to the elephant in the room in all this, which is these energy-intensive industries. I haven't yet seen any attempts—. Well, let's discuss what is being done. Because, clearly, there's an amount of evidence that the reason that UK steel is finding it difficult to compete with our European competitors is because of the price of energy that they have to pay for what is a very energy-intensive industry. So, you mention in your written evidence that the National Grid is constructing a new contractor village, to enable us to build this electrical infrastructure for powering the EAF. But the whole thing is so fragile. It all leads back to my questions about heat networks and how we capture the energy we're already producing, through steel, through data centres, et cetera.

So, what discussions have you had with the UK Government about these really significant strategic issues, that these energy-intensive industries are saying, 'We can't compete, because we have one hand behind our back'? How are we going to do this, and does anybody have a plan?

So, energy prices were one of the key areas of concern that we raised at the Steel Council in November. The UK Government has recently committed to reducing the cost of energy to many UK manufacturers, including steel. They've got the British industrial competitiveness scheme. So, that initiative specifically targets the high-energy-intensive manufacturers by exempting them from various levies and then potentially reducing their costs quite significantly. Then they also have the British industry supercharger; that's set to increase to a 90 per cent discount by 2026. That scheme lowers network charges, which constitute a significant portion of business energy bills. There's the green levy removal as well. So, those are actions the UK Government is taking in this space, to try and support energy-intensive industries with their bills.

So, have you been able to have any conversations with your opposite numbers in the UK Government? Ed Miliband and Steve Reed seem to be the main players in this field. Unless we have a joined-up strategy, I don't see how the UK economy can thrive in this strategic area.

So, we had discussions through the Steel Council itself, which I think was really positive, and, as I say, the UK Government has taken some actions recently. I've had a number of discussions with Ed Miliband more broadly on the 'Clean Power 2030 Action Plan' and investments that will need to be made, both in terms of the network, but then also specific projects. The discussions that we're having with the Crown Estate are important, about visibility for the longer term. So, right at the start of the session, we were talking about RenewableUK and their desire to see more projects come through. Well, part of that, actually, does rely on the Crown Estate providing greater visibility on opportunities that might come forward in future years. Because that then does give developers more confidence, it gives the ports more confidence. So, that's what we're discussing with the Crown Estate at the moment.

So, within those discussions—

This is the final question. We will have to move on.

Yes. The final question is the importance of creating a Welsh grid. Because every time we hit all this wonderful energy that's going to be produced offshore, when you send it back to the National Grid you lose energy, and when you send it back to Wales you lose energy again. So, where is the strategy to ensure that the energy generated in Wales is able to be used at the place or in the area where it's being produced, i.e. Wales?

So, Wales is often a net exporter of energy, but, sometimes, we are a net importer of energy. So, I think that having that UK-wide grid and actually the international interconnectors is important, because sometimes we do rely on, for energy security, energy from elsewhere when there are storms and so on. Especially with the geopolitical situation as it is, I think that energy security will need us to look more widely. That said, of course, we've got our ambitious targets in terms of meeting all of our own electricity needs by renewables by 2035, and keeping pace thereafter. So, part of it is about those investments that we're making through Ynni Cymru, for example, those smaller local schemes, but then also, in terms of connectivity, I do think there is a case to have that wider connection, because sometimes we do rely on energy from elsewhere. 

So, in the weeks you've got left, is it possible for you to actually set out how this absolute foundation stone of everything we want to do in industrial strategy is going to be moved forward?

A 'yes' or 'no' please, Cabinet Secretary, to that question: can you do it before dissolution? 

I can't, but the national energy system operator does intend to. We understand that NESO has been doing the work that looks across what the needs are for the future, and that's work that we jointly commissioned. But I understand it will probably be in a position where they're able to publish before dissolution.

Thank you. Alun. 

All of this is taking place in a rumbustious international situation, of course. So, I'm just interested to understand where you think we are in terms of the overall trade context for these conversations. I know whatever you say today in terms of the United States could change tomorrow, or change later today, when Donald Trump wakes up—I recognise that. But, in terms of trade with the US, trade with the European Union, where are we? We understand the damage that Brexit has done to our relationship with trade with the EU, and the profound damage it's done to the steel industry in the United Kingdom. But where are we in trying to rebuild some progress to preserve the existing trade in terms of the EU and also where—? I really don't want to ask you this question, but I'll ask it and see how you answer it. And how you believe that we can manage trade with the United States.

I'll take the EU first. Obviously, we'll all be really concerned at the EU's announcement on the new tariff measures and what they will mean for the steel industry here in Wales. The UK Government is currently in negotiations on their steel measures, and I obviously can't comment on those discussions. But I just want to reassure colleagues that I took the opportunity at the most recent Interministerial Group on UK-EU Relations, which was last week, to stress these points around needing to come to an agreement in relation to steel, because, actually, it's our strongest and most important partner in terms of steel trading, and we need our existing arrangements to be maintained, especially during this period of movement towards net zero.

Can I stop you there, please? So, how—? I don't know which UK Minister you were speaking to in that conversation, but what was the response to that remark? 

It was Nick Thomas-Symonds who chaired that particular meeting of the inter-ministerial group. He, as you can understand, is very aware of the situation particularly in Wales, and he is particularly, I think, sensitive to how important steel is to Wales as a nation as well. So, he understood those points.

But we know those conversations with Brussels are very difficult and not going well at the moment. 

I think both the UK and the EU will have similar concerns around global overcapacity in relation to steel. So, I think that could be an area, actually, where there is common understanding and a keenness to work together. I hope very much that that's the case.

Then, turning to the US, obviously, that's the second largest goods market for Welsh businesses after the EU, and we're obviously concerned about the tariffs that have already been introduced. This was an issue that we talked about at the most recent Interministerial Group for Trade, and that was at the start of January. That's where we talked about the negotiations being pursued under the UK-US economic prosperity deal. Again, I don't have an update on where those particular discussions are, other than to say that UK Government understands the particular challenges for Wales and understands how important steel is for us.

But since that conversation, then, if it was at the beginning of the month, we've had all this nonsense recently about Greenland, and then tariffs being supposedly imposed and then not imposed. We all know that Trump always chickens out—TACO. So, we’ve got a sense of an erratic leadership in the United States that, when it's not murdering its own citizens, is charging about the world, taking decisions that are extraordinarily disruptive to trade. And I'm interested as to your approach to that, because it's like wrestling a bear, isn't it? It's very difficult in terms of trying to deal with what you don't know is going to happen tomorrow. So, I'm interested as to the approach that you take within these inter-ministerial conversations about trying to manage that somewhat difficult relationship.

I think the impetus in those meetings is to make sure that UK Government understands the Welsh perspective and that there are some things that matter particularly to us here in Wales. Tariffs on UK steel into the US, we understand, will remain at 25 per cent until the terms of the EPD are finalised. But we understand there are still further details to be negotiated before steel tariffs can be removed, not least the quota arrangements and so on. One of the things that we are always keen to impress upon the UK Government is that origin requirements for steel based on melt and pour won't work for Wales, because of the move to the electric arc furnace. So, that's something that I think is particularly a Welsh perspective that we're strongly making the case in relation to. And then also, in addition to the tariffs on base steel, the US has also announced tariffs on steel derivatives. That's a really complicated arrangement that currently includes around 700 different products on that list. Some of them, again, are important to us here in Wales. So, I think, for us, the most important point, other than the broader issues around tariffs, will be around that melt and pour point, which is a real concern to us.

Okay. Thank you.

Luke. 

Diolch, Gadeirydd. I think this entire session's underlined how frustrating the situation with steel can be for Welsh Government, because, to be fair, there are so many external factors to consider. The fact that we haven't got a UK steel strategy as well underlines that, and the constant delays we're seeing with it. There's no comment there; that's just me speaking my mind on that particular issue.

But I do want to come back to floating offshore wind. I know the Cabinet Secretary and I have had a number of conversations, a number of exchanges in the Chamber, on it. And I take on board what she said to Jenny in relation to the supply chain element and established supply chains being there, and looking for those gaps in the market where we might be able to fill, and I think that's a good way forward. What about the assembly side, for the assembly of the turbines? Where has Welsh Government been in terms of conversations with UK Government around the need for investment in Port Talbot, for example, on the assembly side of the turbines?

Again, assembly and the ongoing operations and maintenance, alongside some parts of the supply chain—we think those are areas where there is real potential here in Wales. Part of the work that we've been doing, of course, has been around the ports prospectus, which we've talked about, and, actually, that takes us back to our previous session, because the ports prospectus is being actively marketed now around the world through our international teams and also through the UK Government as well. So, those are spaces where we think that there is huge potential for us to maximise the benefits here in Wales.

So what have those conversations been like with the UK Government? I'm just thinking again, about a year ago, conversations with the sector—they were highlighting that investments were being made in ports on the continent, particularly in France and Spain. And then, more recently, I'm starting to hear that investments are being made in Avonmouth around, again, the assembly and potential manufacturing of some of these things. Has it been a case where, having conversations with the UK Government around this, there's been some reluctance in getting that funding available for Port Talbot? Have they looked at, say, for example, Avonmouth and gone, 'Well, that's west enough', and then, 'Take full advantage of what's going on there'? Because there's a real risk and a real concern, that I'm picking up at least, from, again, the sector and various businesses within it that, actually, we're going to see the benefits that we've been talking about with floating offshore wind for places like Port Talbot being completely missed out on.

So, investment in the port is going to be absolutely critical, and this takes us back to that point, actually, that not only do developers need that certainty of the pipeline in order to invest, the ports need it as well. We've been ensuring that there are discussions taking place between Great British Energy, the National Wealth Fund and the ports to see what can be done to de-risk that investment by the ports. So, I hope that they can make some progress in that space, especially since it seems to me that investment in ports was absolutely something that the National Wealth Fund was set up to deliver, really.

So, where does Celtic Freeport factor into all of this? We still haven't had the signature on the memorandum of understanding. Where are we at with that exactly? 

Both MOUs are, I would say, imminent, and that will allow then the release of the £25 million seed funding for each of the free ports. But just to reassure you that that's imminent.

Is that end of Senedd term, 'imminent'?

I would certainly hope so. 

Okay. So, you can't guarantee it, though.

As far as I'm concerned, things are on track, and we will have that MOU signed shortly, but I don't want to make myself a hostage to fortune for any particular timescales today. So, I would hope so.

Diolch.

Hannah.

Diolch, Chair, and apologies for joining you part way through. I think a lot of what I was going to cover around the workforce and community has already been touched on by colleagues, but I just want to pick up on one specific point in respect of that, if I may. Obviously, you know that a lot of the roles that have been, sadly, lost at Port Talbot were highly skilled, highly sought-after employment, which is of real value to the community and the economy of the port, and, indeed, to Wales as a whole. So, is there any analysis, Cabinet Secretary, or do we have any data, or is any work currently being undertaken, to look at the risk of some of the replacement employment being lower skilled jobs and not having parity with, for those affected, the roles they were undertaking previously?

So, at the moment we don't have the data. I understand that there's further data available in February, in terms of some of those outcomes, but I'll ask Aine to say a little bit more about what data might be coming forward in terms of the workforce. I think it is, unfortunately, inevitable that some of the workforce will have moved on to more poorly paid jobs, given the fact that many of those roles were very, very highly skilled. So, there is a danger, of course, that that has happened, and, as we've heard, when I set out some examples at the start, quite a number of people have moved into self-employment, and we know that that can be really tough, when you start a new business as well. So, I think almost inevitably that that will be the case—that a number of highly skilled workers have gone into roles that are not well paid. But I'll see what data we can share.

Yes, so, in terms of the data, in terms of the transition board funding, we don't have that available at the moment. We understand that will be part of the evaluation and analysis when those funds have been completed. But, in relation to support that we administer through our own Welsh Government ReAct+ programme—and Neil may want to come in on this—there is a routine follow-up that's undertaken with participants to understand the impact of the work that's been done with them there, and a smart survey digital questionnaire. The next batch of surveys is due out in mid February. So, there will be an analysis after that that may be able to respond to some of those questions. But, I don't know whether, Neil, you wanted to come in any further on that.

I haven't anything to add to that, no.

Okay.

If I may, just very briefly, just on that final point—that was helpful—in terms of once that information's available, I think you said mid February, would that also cover examples such as, if people had comparative highly skilled roles, if they've had to travel further afield, and what has been based in the locality as well?

I'm afraid I don't know the detail of what those surveys cover. That would be sitting with colleagues in the employability section. We'd need to come back with the detail of exactly what data that could produce, but we can do that.

Again, I think there is some inevitability there, because we know that some workers will be employed at Hinkley Point, for example, so really significant journeys for them to make, but really highly skilled and sought-after roles there as well. We'll try and pull together as much more information as we can. And if we don't have that, we can set out when it might become available. That late February information will be of interest to the committee. And engaging with the unions as well, because they've done absolutely incredible work supporting the local community and advocating for that community.

Thank you.

Just out of my own curiosity, you said about the unions doing good work, and I concur with that, but we've had representations from the local reps that they weren't invited to the transition board. When we queried this with the Secretary of State's office, there was no uptake to say that they would be invited and there'd be a standing invitation. Can you explain to the committee why local reps were excluded from the workings of the transition board in favour of the national reps? It just seemed a bit bizarre to me. 

We do know that the three steel unions are represented on that board, but, as you say, I received the same representations that the committee has received. I think the committee, and we did also, wrote to the Secretary of State on that, as the chair of the board. I do understand then that she committed to meet with the local reps, but membership of the board is really a matter for the Secretary of State to respond to.

But do you, like the committee, not really understand why they're not included in the standing invitation to the transition board? Is that the case?

As I say, I've taken it up with the Secretary of State. I don't think you can overestimate how important that very local knowledge is and hearing from people directly embedded first-hand within the community. We have had people attend the transition board. For example, I mentioned Martyn, one of the people who had set up his own mental health company. He attended the board and he gave a really powerful testimony of his experiences and his experience of setting up a new business and why he was so passionate about mental health following the closure of Tata. That one testimony was so powerful within the transition board. I will always support the need to hear directly from the coalface.

Of course, if we had the Secretary of State before us today, we'd get the answer to the question. Sadly, she's declined our numerous invitations to come and speak to us. So, we're grateful to you, Cabinet Secretary, for coming to speak to us, and in particular your officials as well for coming along. The Record will be sent to all three of you for your contributions today. If you have any concerns about that Record, then raise them with the clerk. Otherwise, that'll form the official record for the evidence that you've given today.

We'll now go back into private session while we change round for the third and final box-set episode of this blockbuster performance, and we'll resume at 11:50.

Welcome back to the third and final evidence session with the Cabinet Secretary for the economy and her officials, dealing with the local growth fund. I'll ask, as I've done in the previous two sessions, the Cabinet Secretary to introduce herself and her position, and if your officials then could do the same, and their positions, for the record, and then we'll go into questions. Cabinet Secretary.

Rebecca Evans, Cabinet Secretary for Economy, Energy and Planning.

Liz Lalley, director of economic strategy.

Tom Smithson, deputy director for economic strategy and regulation.

Thank you, all. Looking at the growth fund, the aspiration for the growth fund is to support productivity, growth and tackle issues leading to economic inequalities across Wales. No-one would disagree with those sentiments, but bear in mind the indices have hardly moved over the last 20-odd years, and they've moved, sadly, marginally, how confident are you that this new initiative will meet the aspirations that you set for it, Cabinet Secretary, to improve the outcomes for the very communities that will benefit from it?

I would say that Wales has seen significant progress over the last 20 years, or since devolution, in fact, in terms of reversing trends, or certainly reversing gaps, in unemployment, and, until the pandemic, in terms of economic inactivity. What we really want to do is build on that progress. We certainly accept that there is lots to do in this area and lots of challenges remain. Some of these do relate to some of the structural weaknesses that we have in our economy and our labour market, including that lack of agglomeration, which we know affects productivity.

We also need to be realistic that the local growth fund on its own won't be the thing that shifts the dial, but it absolutely can make an important contribution alongside other investments and other initiatives. So, thinking about the work that's going on in terms of the AI growth zones, the investment zones, free ports, the defence growth deal, all of those things together, alongside, I think, the local growth fund, will make the difference.

Obviously, we're seeing a shift now away from the shared prosperity fund, and it is very much now about a new focus on, as you say, productivity, reducing economic inactivity, and addressing economic inequality. These are things that we consulted on. Our consultation closed recently, and we're currently analysing those responses for consultation, with a view then to having a Cabinet discussion on the way forward.

Productivity is a line that you've looked at and wanting to improve and increase, and it's one thing that most economists point to as being one of the deficiencies of not just the Welsh economy but the UK economy. Can you give me an example of where you think that this fund will make a real difference in improving productivity in communities in Wales?

Yes, certainly. It is worth as well mentioning that Wales has recorded areas of improvement in productivity over recent years. Labour productivity grew faster between 2009 and 2023 in Wales, with an increase of 14.1 per cent, compared to the UK as a whole, which was 10.5 per cent. I think that that is positive and it does give us something to build on.

In terms of where the investment might help to make that difference, obviously this is a capital-heavy fund, but one of the things that we can do with capital is invest it in research, development and innovation, for example. Those things, I think, can make a difference in productivity. Similarly, investment in businesses and supporting businesses can make differences in terms of productivity there as well. Those things, again, have been things that we have been consulting on in terms of understanding where the biggest differences could be made and where our investment can make a difference.

You highlighted the point about the consultation, Cabinet Secretary. I appreciate you are digesting those consultation responses at the moment, but from your early analysis of the responses, is there anything that stands out in those responses that you might consider beneficial in making changes to your original concept of what the local growth fund might look like?

We had just over 150 responses to the consultation. Alongside that, we held some regional consultation events—over 200 people participated in those. Also, we've got the regional investment steering group, which is chaired by Carolyn Thomas. That's been really important in terms of hearing the voices of all partners who've got an interest in this. The aim is to make an oral statement to the Senedd on 24 February after we've been able to look through the responses and consider what changes we might need to make.

Just to give you a flavour, though, as you say, on the early responses, the initial analysis does include very strong views that, actually, we need to be really, really focused, careful and pragmatic in terms of prioritising the funding available. But the main reason for that concern was because of the proportion of revenue that we have, so this fund is going to be different to things that have preceded it. And then also looking at reducing the number of priorities to reflect the feedback that we've had to, again, better reflect the capital-heavy nature of the fund.

In terms of the regional approach, again, we heard that it's really important that we give regions enough flexibility to tailor the investments to reflect their specific strengths, opportunities and challenges. So, in that sense, no showstoppers or real surprises from the consultation, but an overall acceptance that, actually, our focus on productivity and economic inactivity is the right one, but equally, a need to work ever more closely with our regional partners to ensure that they're given the tools and flexibility they need to deliver.

Okay, thank you. Alun.

In terms of the structure of decision making, you're expecting a statement on 24 February, so the decisions in Cabinet will be taken next week or the week after.

Yes, shortly.

Shortly. So, next week or the week after. You will be publishing, I presume—. I don't think I've seen the consultation responses yet. You will be publishing those.

Yes.

The membership and minutes of the group chaired by Carolyn Thomas, have the minutes been published?

Yes, those are published regularly.

So we can look at those online, through the Welsh Government. Okay. I'm grateful to you for that. In terms of gathering this sort of information base to take your decisions, I presume you'll be looking both at these responses now—. And you said there are no surprises there, so we can assume that we will recognise much of what's been said. To what extent are you also rooting this decision making on experience? Because we know that Objective 1, when that was first introduced 20-odd years ago, did okay, but there were significant lessons learned, and then future structural funds were rooted in structures and projects and programmes that were based on that learning. We also know that the shared prosperity fund and stuff didn't learn those lessons and repeated some of the mistakes of Objective 1, and some of the evidence this committee has received has been from people who still want to repeat the mistakes of Objective 1, if you like, and not learn the lessons. So, I'm interested to understand your approach, Cabinet Secretary, and what your vision would be for both the structure and impact of this new fund.

We were really keen to learn the lessons of what's gone before, in terms of previous EU funding, but then also the shared prosperity fund. We wanted to avoid what was seen as the overcentralisation, which was a criticism of EU funds, but then also avoid some of the issues around the shared prosperity fund lacking a strategic focus. We were very mindful of both of those things. Then we also tasked the Organisation for Economic Co-operation and Development to undertake some work for us. They looked at how a future scheme might best deliver for Wales. That really helped us in terms of thinking about the regional approach and strategic alignment.

Alongside that, we've had to layer on Wales's socioeconomic situation as well, to try and make sure that what we're doing actually allows things to be targeted where the investment is needed. Also, though, looking at learning lessons from the past, we would hope a lesson for the UK Government is that longer term planning, so we would much prefer to see a 10-year horizon, so that, especially when funds are capital heavy, investments can be viewed in that kind of longer term context. Now, obviously, that's outside of our control and, again, colleagues will have heard me talk before about the revenue/capital split. We would have preferred to have seen something more akin to the previous shared prosperity funding, which was more revenue heavy, in that space. So, we've looked at things that we would learn from the past and tried to to be mindful of that as we've developed the new programme we've consulted on as we go forward.

I can talk through some of the processes we went through in getting to that consultation, because we weren't starting from scratch. I think immediately after the decision to leave the EU, a lot of work was done to try and capture the lessons from the last 20 years of EU funds, and, exactly as was said, the issues with Objective 1 of two small projects not necessarily connecting with each other, no focus on outcomes. The pendulum kept swinging in successive EU programmes to centralisation and then we were moving to a more regional model. We then carried out two projects with the OECD to build that international evidence base into the thinking that the Welsh Government was doing, which led to the 2021 framework that tried to capture all of these things. So, the consultation wasn't starting from scratch, it was building on all of that and trying to build in the lessons from the shared prosperity fund.

There are some things that local authorities in particular and others have welcomed from the shared prosperity fund, and we are trying to recognise that. The simplicity, the lack of bureaucracy and the flexibility have been particularly welcomed, but, again, it's getting that balance right. We have also been following closely all the different committee reports and recommendations throughout the course of the shared prosperity fund to make sure those are reflected. Some we can address, some we can't; this isn't an ideal situation, but I think it is evidence based. 

Okay, I'm grateful to you for that, but I'm looking as well at how the politics of this works and how the economic impact of this works, because we had a conversation in a previous session where I feel the Welsh Government has taken, all too often, the easy option in terms of economic policy and investing in areas where the market is already delivering work, jobs and growth, and not investing in more difficult areas, poor areas where there's less economic activity. So, I'm interested, and I think, Cabinet Secretary—I don't want to put words in your mouth or misquote you, but I think you said the local growth funds were an opportunity to move away from that approach earlier. So, I'm interested, therefore, in how you see these local growth funds delivering for areas such as the Heads of the Valleys, which I represent, but also areas of west Wales, north-west Wales and the rest of it, where there are more profound economic challenges than the areas such as south-east Wales and north-east Wales, where, so far, the Welsh Government has focused its efforts. 

Well, we're currently considering the methodology for funding from years 2 to 3 onwards, and this is subject to Cabinet discussion, so just to give you a flavour, but to reassure you that the Welsh index of multiple deprivation is an important factor in terms of the kind of things that we would want to be looking at for potential methodologies. But I probably shouldn't go further than that today because decisions are yet to be made. 

But it is important that this committee feels reassured that the Welsh Government is not going to continue to pursue an economic policy that benefits the richer areas of Wales against the interests of the poorer areas of Wales. I think people in Wales will expect particularly a Labour Welsh Government to have a focus on poverty, on economically challenged areas and areas where there are significant levels of deprivation, and delivering, then, the sort of economic policy that will help strengthen local economies in areas that I've already named. So, I think I do want to push you to go a little further, if I'm quite honest, Cabinet Secretary, because I think the committee does have a legitimate interest in understanding why that shift in policy, if you like, is being considered by Government.

I think the fact that the key things that we've said that we wanted to address in our consultation—that we talked about, that we'd want our funding to address—would be productivity and economic inactivity should give that level of reassurance that that is a top priority for this funding: to support people into employment and into good employment. 

Okay. So, if we're looking at—. We've discussed, and we will discuss later in the session, the capital/revenue division, and I don't want to go down that route now, but I am interested, therefore, in the sort of capital investment that you are considering to deliver additional economic vitality in areas, whether it's Heads of the Valleys or elsewhere, which can be delivered as a consequence of your approach, which you've already described, in the use of these funds.

So, in our consultation, the investment priorities and objectives listed offer capital opportunities to help businesses to grow, to ensure there's investment in developing strategic sites, which is something that we talked about earlier in relation to the Heads of the Valleys; increasing research, development and innovation; and then also driving regional transport and energy infrastructure. So, those were examples of things in the consultation we thought—

I'm going to have to move it—

Can I just have one more?

One, very briefly. It's only a half‑hour session.

You were a little, how shall I say, reluctant to publish KPIs in an earlier session. You gave the impression, and I'm sorry if I'm misrepresenting you, but the point I'd like to make in just pinning you down a little bit further, if we could, is that when you publish the written statement or the oral statement at the end of February, you will be setting clear objectives and measurable objectives for future Welsh Governments to deliver over this funding period, so that this Parliament, however it's constituted after May, will have the opportunity to hold future Ministers to account for the sort of decisions that are being taken.

So, the intention at the oral statement is to set out the direction following the consultation. But just to remind colleagues that we've agreed with local government for a further transitional year, at their request. So, the decisions for years 2 and 3 will still be subject to some level of discussion. Perhaps I'll ask Tom to say a bit more.

Yes, I think the sequencing of it is we'll be publishing the consultation findings in February, and the direction of travel, and there will then need to be a discussion with the UK Government on the investment plan before that's finally agreed. The intent would be to have outcomes and outcome indicators as part of that. I think what might need to follow after that is the more detailed monitoring and evaluation framework. Unfortunately, the pace at which we're having to try to do everything means we can't necessarily have everything ready on day one, but I think that's the sequencing we're working to. So, there is an intention to have a clear set of outcomes that we're working towards. I think with a very capital‑heavy programme, there are questions about how much we can demonstrate within the life of the programme, and how much will need to follow afterwards.

I'm going to have to move on—Jenny's got a supplementary.

Did I hear you correctly that the UK Government was going to be endorsing a Welsh Government strategy? It's devolved, isn't it?

In terms of agreeing the returning of decision making, Welsh Government is the accounting officer for the £547 million fund, but the relationship that we have is broadly similar to the structural funds era. So, what it does mean is that there will be a very light‑touch relationship, as compared to Europe, with the UK Government. The intention is to have an annual review with the UK Government, where we would share progress information on how the fund is delivered in Wales, again similar to the EU way of working, but also much more light touch and flexible. The EU had a very high compliance burden that involved stringent, regulatory audit and monitoring arrangements—

Some of us know all about that. But the point is, we want to be sure that, whoever the Government is down the other end of the M4, it's the Welsh Government that is driving this particular process forward.

We also sat in the EU Council making those decisions—

Okay, we're not reminiscing about the EU—

But it's important, because it's about our democracy, because the Minister is accountable to this Parliament, not to another Government.

Can I just check the point that you made? You, as a Government, or your successor in May, will be able to spend the money for which you set the priorities without sign-off from Westminster? Because my understanding of the old EU grants was that you'd have to go to Brussels and have your plan agreed, and then you could spend the money. You indicated that there's a level of sign-off required from UK Government before the money can be committed.

So, we're at the point at the moment of discussing a memorandum of understanding with the UK Government, and that will formalise arrangements to ensure that our expectations are aligned. But they are standard practice, where we are using UK Government wider programmes, so free ports, for example, investment zones. So, this is a wider UK Government programme, technically, even though we are having the funding returned to us as accounting officers, and the power to develop the schemes and the investment plans.

Okay, thank you. Hannah.

Thanks, Chair. Alun Davies did say previously, Cabinet Secretary, that he wasn't going to touch on the funding arrangements, but I am going to turn to that now, because I know there's been quite a bit of discussion, and I know this is something you're very conscious of in terms of the different arrangements in different nations, and obviously that divide between capital and revenue here in Wales. So, are you able to update the committee on any progress that you've made, in terms of your discussions with the UK Government, that revenue should at least initially make up a greater component of the fund? Thank you.

So, I can update. Unfortunately, we haven't had any positive progress in that space. I have made the case to the UK Government—I've written to the Secretary of State, Steve Reed. I think we've got a meeting coming up at the start of February as well. We continue to make that case for a higher proportion of revenue. But those discussions aren't positive, shall we say. UK Government tells us that the capital focus is very much in line with its industrial strategy. They say it's being applied UK-wide, not just for Wales. And it goes without saying that the capital-heavy fund is going to be more problematic and more challenging.

On the capital/revenue split, it is the same as Scotland and Northern Ireland, but the situation in England is more complex. So, what the UK Government would say is that there's an allocation given directly to some mayoral strategic authorities and a £500 million capital-only recyclable investment fund involving regional allocations. And taken together, they would mean that England's MSAs also have roughly a 70 per cent/30 per cent capital/revenue split. So, that's the UK Government's explanation.

They also say very clearly that, actually, this is not a continuation of the shared prosperity fund and it shouldn't be seen as such. Instead, it is a fund that is there to drive forward the delivery of the industrial strategy and wider economic development. So, we've tried to make the case strongly. I know our colleagues in local government are trying to do the same. But it doesn't appear to me that we're going to have any success, unfortunately.

Hannah.

Yes, thanks, Chair. Thanks, Cabinet Secretary for that update. Just on the same matter, the revenue/capital split, we've had evidence from, and you have heard from, local authorities, and I take what you said, that the UK Government has said to you that it's not meant to be the same as the shared prosperity fund, but I know that local authorities have very real concerns that the split between revenue and capital could result in job losses in terms of the capacity and expertise they have to perhaps deliver some of the projects that have been previously funded. They've also raised with us a concern about the level and timing of their involvement in the development of the fund. Do you have any reflections on those concerns? And is there a way—? I know that hindsight is a wonderful thing, but are there any learning points, perhaps, on how greater local authority stakeholder involvement can perhaps identify some potential issues with capital and revenue funding at an earlier opportunity?

I am surprised to hear that local government feel that they haven't or that they're not satisfied with the level and timing of engagement, because we've put in place meetings with local government ahead of every steering group meeting and at points where we have specific things that we wanted to talk about, such as the capital/revenue split. It is genuinely the case that we found out without any warning about the capital/revenue split. If we had heard about it sooner, we would have informed our local government colleagues about it sooner. We are being completely straight bat and upfront with local government about all of this and involving them and listening to them before any decisions are taken—so, important conversations ahead of the consultation, recent discussions now ahead of the next steering group meeting. And those meetings involve me and the four economy spokespeople from the WLGA. But, beyond that, we also have really good engagement at official level with officers in local government as well. So, we are doing everything we can. If there's more we can do to be even more open and engaging, we obviously would want to do that.

On job losses, the transition arrangements that we've put in place do try to help to mitigate those as best as possible, bearing in mind that there is this change to the different capital/revenue mix. I know that the UK Government has also extended the closing date for the shared prosperity fund by six months. Again, the intention there was to try and smooth out some of this and help manage a more effective transition, although it doesn't provide any additional funding. So, yes, this is one of our concerns and it's why we're making that argument for a greater revenue mix.

Thanks. I think, Chair, that the Cabinet Secretary's points on transition neatly segue to the next set of questions. 

Thank you, Hannah. Luke.

Diolch, Cadeirydd. As part of the consultation, it's set out that the aim was to agree the approach to transition with local authorities by the end of 2025. Were you successful in doing that?

Yes, we've worked really well with local government to agree to the further transitional year. That's something that's only available to local authorities in Wales. So, again, it's something where we've tried to show that we've really listened. Another difference in Wales is that the funds will be pan Wales, whereas in England they're very focused on those mayoral authorities, and, in Scotland, only some of the regions will be receiving funding. So, again, we've tried to listen to local government and respond to their concerns. 

I did write to each of the regional local authority leads in December to provide them with reassurance about our intentions, obviously subject to the consultation and agreement of the investment plan. But what we did try to do was to give as much certainty and confidence as we could before the end of the calendar year to try to avoid any unnecessary job losses, and so on. We've tried, as I say, as best we can to respond to local government's concerns about an additional transitional year. As part of that letter, I was able to provide indicative allocations for each of the regions to support them with their planning. Again, at the request of local government, those allocations are based on the current SPF proportions. So, again, it gives them more confidence upon which to plan.

Okay. If you can share the full detail with the committee through written correspondence, there would be a number of people who would just be interested in seeing the specific detail on that. 

On the job losses side, this was a primary concern that was raised with us on that transition period. So, I would like just to tease a bit more detail out of you around how the Welsh Government will be looking to minimise some of those job losses that are potentially coming.

Ultimately, the shared prosperity fund is coming to a close. So, we've tried to mitigate that by providing this additional transitional year, the UK Government's additional six months for the closure of the shared prosperity fund, and so on. But I think that the most important thing that we've been able to do is support local government through the revenue support grant and trying to provide local government with the best possible settlement, as we always do. So, this funding should only be seen as a small part of the wider picture of local government. Inevitably, they'll have difficult choices to make, because, as I say, we are coming to the closure of a specific programme. But we've done what we can to try and mitigate some of this.

At an official level, we have regular working groups with each of the SPF regional leads and, collectively, we're trying to accommodate any requests they have. So, we've been looking at the Welsh—. The Cabinet Secretary for Finance has consulted on capital finance arrangements recently. There's a direction from Welsh Ministers from April that allows for capitalisation of some costs. We're making sure all those options are being explored and we are working with them very closely to make sure they're aware of the consultation findings as they're emerging. So, we're working through the lists of projects they have, essentially, to work out the ones that fit with the direction of travel for the local growth fund, so that they can think early about how the things that don't fit, how they might be accommodated within their own structures.

So, you've been able to do as much as you can, essentially, in this field.

And part of the transition was to utilise the existing structures and the existing capacity and capability within local government, rather than a shift straight to a new model. That helps with the programme support staffing.

Okay. Jenny.

Important not to reinvent the wheel. You've clearly stated that your plan is to use the four corporate joint committees to lead on the regional allocations. What methodology are you going to be using to justify any national project?

We thought the CJCs, actually—and we consulted on this—were really well placed, because the purposes directly align with the local growth fund model. Strategic economic development, regional transport planning and land use planning are going to be core levers that will be required to underpin regional growth and will be crucial to the success of the local growth fund. You mentioned not reinventing the wheel; that is actually why we've decided to propose that CJCs would be the correct delivery model.

Did you read our report and our letter on the north Wales CJC's delivery of the growth fund up there?

If you wrote to me, I'm sure I have.

It was lamentable.

I will absolutely agree with you that there are different views amongst local government about CJCs and the use of CJCs for the local growth fund. However, this is what we have proposed.

I don't want that in Blaenau Gwent. My experience is that the CJC covering south Wales, the Cardiff city region, is Cardiff, south Wales and the M4 corridor, and that's fine for doing that. But, for an organisation that has failed to deliver any strategic approach to the economy of the Heads of the Valleys, I certainly don't want them touching it. Why would I?

Again, it's partly about not reinventing the wheel, in the sense that—

But we don't have a wheel to reinvent. That's my problem.

But you do have regional growth and regional transport plans. Each of those will have embedded monitoring and evaluation frameworks. You will have strategic development plans also being developed at the CJC level. In that sense, you have the tools and you've got a structure in which delivery can take place. But I absolutely recognise there are different views amongst local government and amongst colleagues on this particular point as well.

Thank you. Jenny.

Based on the conversations we had with three of the four representatives of CJCs last week, my concern is that they lack the breadth of partnership and collaboration with the private sector that, for example, the south Wales industrial cluster had. They've been replaced by these CJCs, which are very focused on public sector matters. So, that's a concern for me. I wondered if you could tell us, based on some of the concerns that the committee has, what methodology you are going to use to determine the indicative allocations between the four regions.

So, again, that will be part of the discussion at Cabinet, but I might just ask Tom to say a little bit more about some of the tools that we could be looking at in that space, without pre-judging any decisions that might be made.

On the partnership point, that has come through in the consultation in terms of the need to strengthen that through the CJC model, and I think having the transition year provides that time to make sure those conditions and arrangements can be built in.

In terms of the allocation methodology, I think the points earlier about focusing on those areas with most need—the areas that aren't necessarily getting investment when you are focusing solely on things like the UK industrial strategy, or like the investment zones do on already high-growth areas—. So, quite popular through the consultation has been the Welsh index of multiple deprivation as a key tool. We are also looking at modelling around productivity variations, and you'll see that mid Wales and parts of west Wales, in particular, are much further behind on productivity levels. We're also looking at indicators around sparsity, rurality as also a proxy for lack of agglomeration and a lack of density. So, those are the kinds of things that are being modelled, and Ministers will have a series of options to consider on that basis.

Well, certainly, we didn't hear from the mid Wales CJC last week, and the need is there because of the topography, if nothing else, and sparsity. They are going to be very different strategies to the ones in the more urbanised areas. So, is it that you're going to see it through a different lens, because those areas are important, but they're not going to do some of the stuff that you could do in urban areas?

I think that has come through in the consultation as well, particularly the events, where we had one in mid Wales, of us making sure that the national framework does prioritise things, but also allows for that flexibility. I think the infrastructure challenges in particular in mid Wales were different to those in other parts of the country. So, I think that's the balance we're trying to strike in framing that national framework to allow for that.

So, how are you going to avoid—

I'm going to have to move it on, sadly, because time has nearly beaten us. Tom, the final set of questions, please.

Thanks, Chair. Only one question from me that has not been covered already: how will the Welsh Government ensure that administrative costs and burdens are kept to a minimum in delivering the local growth fund?