Pwyllgor yr Economi, Seilwaith a Sgiliau - Y Bumed Senedd

Economy, Infrastructure and Skills Committee - Fifth Senedd


Aelodau'r Pwyllgor a oedd yn bresennol

Committee Members in Attendance

Bethan Sayed
Hefin David
Joyce Watson
Mohammad Asghar
Russell George Cadeirydd y Pwyllgor
Committee Chair
Vikki Howells

Y rhai eraill a oedd yn bresennol

Others in Attendance

Frank Holmes Cadeirydd y Bartneriaeth Tŵf Economaidd Rhanbarthol
Chair of the Regional Economic Growth Partnership
Kellie Beirne Cyfarwyddwr, Bargen Ddinesig: Prifddinas-Ranbarth Caerdydd
Director of Cardiff Capital Region City Deal
Martin Nicholls Cyfarwyddwr Lleoedd, Cyngor Dinas a Rhanbarth Abertawe
Director of Place, City and County of Swansea Council
Rob Stewart Arweinydd Bargen Dinas-ranbarth Bae Abertawe
Leader, Swansea Bay City Region
Rhys Thomas Prif Swyddog Gweithredol, Bargen Ddinesig Prifddinas-Ranbarth Caerdydd
Chief Operating Officer, Cardiff Capitol Region City Deal

Swyddogion y Senedd a oedd yn bresennol

Senedd Officials in Attendance

Ben Stokes Ymchwilydd
Lara Date Ail Glerc
Second Clerk
Robert Lloyd-Williams Dirprwy Glerc
Deputy Clerk

Cofnodir y trafodion yn yr iaith y llefarwyd hwy ynddi yn y pwyllgor. Yn ogystal, cynhwysir trawsgrifiad o’r cyfieithu ar y pryd. Lle mae cyfranwyr wedi darparu cywiriadau i’w tystiolaeth, nodir y rheini yn y trawsgrifiad.

The proceedings are reported in the language in which they were spoken in the committee. In addition, a transcription of the simultaneous interpretation is included. Where contributors have supplied corrections to their evidence, these are noted in the transcript.

Dechreuodd y cyfarfod am 9:35.

The meeting began at 9:35.

1. Cyflwyniad, ymddiheuriadau, dirprwyon a datgan buddiannau
1. Introductions, apologies, substitutions and declarations of interest

Good morning; bore da. I'd like to welcome you to the Economy, Infrastructure and Skills Committee. Item 1: we don't have any apologies. We're expecting two Members to join us shortly. If there are any declarations of interest, please do say so now.

2. Papurau i'w nodi
2. Papers to note

In that case, we move to papers to note. We have a number of papers. We have a letter from Credit Unions Wales to the committee. That is there to note.

We have a letter from the Chair of the Children, Young People and Education Committee, for information. And we also have a letter from the Chair of the Committee on Assembly Electoral Reform as well, which we do need to answer, which I know we discussed last week and we'll discuss at the end of the meeting. But are Members happy to note those papers? Bethan Sayed.

Yes, I'm happy to note the papers and I just wanted to request, additional to that, we've been sent a report by Cardiff Airport, following their evidence on carbon emissions, and I was wondering if we could—. We've received the report, which we're grateful for, but we are being told that we're not able to release that to the public. I'm getting requests for that to happen, so I wondered whether, as a committee, we could write to Cardiff Airport and request formally for that report to be made public just because of the public interest in this area.

Yes, I know. I know we've asked informally for that to happen. But I'm certainly content, as a committee, that we ask for that to be made public. Are Members content for me to do that on behalf of the committee? Thank you and thank you, Bethan.

3. Diweddariad ar y Bargeinion Dinesig: Prifddinas-Ranbarth Caerdydd
3. City Deals update: Cardiff Capital Region City Deal

In that case, we move to item 3 and this is our third session in regard to city deal updates, and this morning we have three officials with regard to the Cardiff capital city region. I'd like to welcome—in your case, Kellie, I'd like to welcome you back to committee, but if I could ask you to introduce yourselves for the record and your colleagues as well.

Thank you very much and good morning, everybody. I'm Kellie Beirne. I'm director of the Cardiff capital region city deal.

My name is Frank Holmes. I am the chairman of the regional economic growth partnership and the investment panel.

Good morning. I'm Rhys Thomas and I'm the chief operating officer for the Cardiff capital region city deal.

Lovely. Thank you for being with us this morning, and perhaps, Kellie Beirne, if I look to you: you were here 12 months ago, giving us an update from your perspective at that time, so I'm wondering if, perhaps, in general summary, you could give us an update of what's been achieved in the last 12 months since you were last with us.

Okay. So, thank you very much for that opportunity, Chair. It's been a very busy year, and I think there are lots of key milestones, which I'll cover in a second. But I think what we've spent the last year doing is really trying to put the essential foundations in place—making sure our house is in order so that we've got a strong platform on which to build. And I think I included in the evidence statement just a very brief oversight of some of the schemes and the proposals and the projects now that we have in our investment pipeline.

So, I think what I explained this time last year, Chair, was that we were trying, for example, to be very clear about data and evidence: what are the key economic strengths in the Cardiff capital region? What are the things that we need to do to mobilise around those strengths? What's the research base like and how does that connect innovation strengths into industrial strengths? I think I spoke as well about the need to have some kind of cohesive plan for the Cardiff capital region. 

So, one of the first things that we did, working with our economic growth partnership, was to put our strategy into play. So, this is the Cardiff capital region industrial and economic growth plan. So, this sets out the priorities that we really need to invest in, if we're going to move the needle on the south-east Wales economy. So, things like clusters—you know, getting behind the key ecosystems that we need to build, if we're going to turn the dial.

And the other thing that this document is very clear about is the importance of place. So, it's not just, 'What will we invest in?', it's 'Where will we invest to make the biggest impact?' because this is about a whole regional agenda. Having the evidence in place and the plan then enabled us to do this, again, with the leadership shown by regional cabinet and our economic growth partnership. It was to put in place a proper investment framework because even though we had a wider investment fund that was open for people to make applications into, we had no way of assessing those things. We had no way of pinpointing the very things that we needed to make investments around.

So, this document establishes three funds: an innovation investment fund, an infrastructure fund and a challenge fund. It sets out our priority sectors and it gives a strong framework, really, to accept submissions and propositions into our investment funds. And those propositions are starting to come in, I think I've detailed in the round-up that I did. Yes, we've got a lot of projects that are public-sector promoted that we're dealing with at the moment—the housing catalyst fund, the metro plus, which is starting to deliver, which is a metro enhancement scheme and metro central in Cardiff central, which is that transport interchange project. We've got money in, so we're applying to UK Government; you will have seen things like our Strength in Places fund applications and there's the local full-fibre network scheme.

So, the goal for us has been, 'Yes, let's mobilise around the public sector projects, but let's open the investment framework up to see what fantastic projects we've got coming in from the private sector, the third sector, the community sector and others.' So, that's where we're at. An awful lot of work has been done, but it's been essential work, otherwise we wouldn't have the strategy and the guidance in place to be able to target the key markets that we need to be able to move the dial on the south-east Wales economy. So, that's a very, very quick overview, Chair, but I'm sure we'll go into some detail as we get the questions.


We will. I'm not going to dive into some of the questions around that, because I know other Members will want to take those opportunities up later on. But can I just ask, are there any areas where work or development hasn't progressed as fast as you would have anticipated in the last 12 months?

Not really. I mean, I think the partnership agenda is very strong, which Frank can speak to. So, I think the business engagement has improved leaps and bounds. I think what we've been trying to do is to mobilise at the same time as to recruit a team. So, sometimes, things are not always in perfect sequence, but I think, really, the bit that we need to focus on now and substantially improve is our engagement, especially at a public and a community level, and getting some of those key messages out and creating some real visibility around the public-value elements of the city deal. So, that's a job that we've got front and centre in our business plan for the forthcoming year, and I think that absolutely has to be the priority moving forwards. 

We mustn't forget that this is a 20-year programme, and the things that we are laying down today for the next few years will undoubtedly change as the world changes around us. We have to build into these plans and our investment framework resilience for the world of tomorrow and the way that our work will change, our whole environment will change. So, it's an ongoing iteration of updating, and I guess one of the things that we have to be very mindful of as well is that whatever we invest in today has to take into account these factors.

For example, our digital framework: we have a number of projects in that particular arena, but, of course, 5G is upon us. That transforms that entire programme, and until we understand how and where 5G is going, it would not make any sense to rush into other potential investments. So, we are taking a very measured approach to this because we are having a longer term outlook, and I guess we're influenced not only by private sector co-funding but also by public sector projects and undoubtedly, they work at different paces and have different issues as well in terms of getting them over the line.

So, personally, back to the point—and I'm blessed by the fact that we have a board of individuals who give a lot of time to this particular programme—this is a programme; it's a catalyst to try and raise the economic productivity and to bring social and economic inclusion to the region. But we are blessed with people who are putting fantastic effort into this programme, I have to say, covering large business, small business, medium-sized business, across the sectors—service and manufacturing—evoking social enterprise, economy as well as skills and the future of work. Those are all the members we have assembled on the board.


I know that some Members here want to dive into some of the longer term impacts as well, later on in the session, so thank you for that. Finally, if I could ask you to tell us about your engagement with the Welsh and UK Governments. How has that been over the last 12 months?

Good. As I said, I think we've built up a solid platform. We have engagement with the chief regional officers, so I think the formation of regions has been a positive thing, because we're able to align objectives. So, we have a plan for the Cardiff capital region city deal. There is an emergent regional economic framework, so it's important that those two things dovetail and they chime and they fit together. I think in terms of UK Government engagement, that is good. We still have some outstanding questions and issues on things like the gateway review process and how things like leverage are treated. Our investment fund is evergreen; our priority is to get more money in than it is to get money out, and sometimes, that doesn't always sit well with some of the targets and measures that we have. So I think we're trying to engage in a wider conversation about really what needs to shift and change. Rhys, I don't know if you want to add anything to that.

Just building on what Kellie said, really, I think it's important to remember that this is a 20-year programme, and we've got an evergreen principle, so this is not really about running down the grant. It's not a grant, it's an investment fund, so we need to have slightly different metrics. Instead of just looking at what money we push out through the door, looking at what else we are bringing in and how we are adding value by aligning other investment funds, such as projects from the Welsh European Funding Office in a Welsh context, or the Department for Digital, Culture, Media and Sport in terms of a UK context. We are working on some of those things to align activity so that we get better value. They take a bit longer to do, unfortunately, but hopefully, when they come through, the impact will be much longer lasting and there'll be a cohesiveness and a coherence to what's going on in the region instead of things looking a bit piecemeal.

Good morning, all. I note that the compound semiconductor project has been approved, and that's obviously good news. It's been approved by the Wider Investment Fund. Are there other projects that have been approved, or are about to be approved?

Yes. Thank you very much for the question. Just to go back to the story that I covered, really, around putting the foundations in place, we couldn't bring projects into the framework and approve them until we knew what kind of projects we needed to have in the region, and what evidence base underpinned them. Because I think it's great to do loads of one-off projects, but unless they mean anything, unless they're really going to transform our chances, then we've got to question the validity of them. So, getting the evidence base, the strategy and the investment framework has been critical, but yes, to directly answer your question, compound semiconductors was the first project that we did. I know it very well, personally. So, that project is in delivery, in fact, it's nearing completion, but we've built upon that.

We've got a big submission in along with Welsh Government, higher education institutions and a whole industrial cluster to the UK Government for the Strength in Places fund, which is nearly £45 million. So we only have to put £3.5 million into that to leverage that full £45 million. The metro plus scheme has been approved and is in delivery—so, the first scheme now has started in Porth, which is a regeneration project with low-emission vehicle and electric vehicle infrastructure. There's another scheme in Cardiff, the Vale is next, there's one in Monmouthshire coming through, there's another one in Torfaen, and progressively, we will work with all of those local authorities. The graduate scheme is under way and meeting all of its metrics and measures, and we're getting some fantastic value added from trying to reverse some of the brain drain phenomenon that we have in the region. And things like the local full-fibre network scheme with DCMS—that's approved, and we're going through the first stages of that.

But I tried to capture in the evidence that I gave all of the projects that we now have coming into the investment framework, and there are 28 quite strong value propositions here. Now, not every single one of those projects will make it through, because there has to be a process of due diligence, and there's a bigger pipeline that sits behind this, but I hope that gives you confidence that there's a lot of activity. It is being closely considered now by our investment panel and our economic growth partnership, to be able to advise and inform regional cabinet on whether these are the right kinds of proposals to take forward.

If I could just add to that, we had our investment panel earlier this week, and lined up for this particular year are five projects—let me just get that right—sorry, apologies, it's six, which, collectively, add up to £100 million of investment of the Wider Investment Fund. That's over a three-year horizon, but clearly, if you make the commitment in year 1, you are tied in for the rest of that investment profile. So, those are our targets for this year, and we're working very hard to achieve those.


That's really, really good news for the region and really pleasing for us here, but I suppose—. You said that it's a 20-year programme, it is a 20-year programme, it has to be flexible and has to be able to adapt to the changes. So, moving forward, how do you think that you will be able to ensure and manage a healthy pipeline of projects in the future that meet those aspirations we all have and that you identified?

I think two of the big challenges—and Rhys can probably talk more compellingly to this than I can—is origination, so, how do we get out there into the business community, into the third sector and community sector and make sure that we are having the right conversations around the right projects?

The second challenge, which is a very real one at the moment, is investment readiness, because a lot of the proposals that we get, they can be fantastic in terms of concept and ideas, but they're often not oven-ready. So there's a lot of work that needs to go into making them oven-ready.

It's all right. Yes, as Kellie just mentioned, there's a lot of interest and a lot of demand for the work that we're doing now, that there's a clear strategy and direction, and that there's an investment framework for people to engage with. The origination of good ideas is a challenge going forward. There's demand there currently, but once we've worked through that, what's the next wave going to look like? Some of that, I think, we will see, potentially, some good projects coming forward in the future based on the investments we will do this year. I think some of the projects we're working on will set good examples of how the public sector, the private sector and the third sector, potentially, can work together and work in a different way to how it's historically been done. There's been more dependency in the system historically, and we're trying to evolve that thinking.

The second element, really, is once we have a few of these key investment decisions in place, it'll become evident where the gaps are and where we need to focus and target our efforts. I think that there'll be a responsibility on us, working with the investment panel and the regional economic growth partnerships, in focusing the efforts and the attention on those areas, and we will, then, co-produce those projects going forward.

And if I can just—. One final question from me. We're all very aware that we need to reduce our carbon footprint, so when we're talking about investing and adapting to change, I suppose the biggest challenge will be the place. Because you mentioned place and it's in your whole remit; it's written in there. So, how are you, when we look at a healthy pipeline going forward, and meeting the challenges that are already in there, how are you going to manage to grow businesses and support businesses to grow, which is what you're doing, actually, in their place, outside of, as well as, within the Cardiff city?

Yes. The clean growth thing, again, it's a huge priority, and we're trying to embed it in all of the investment proposals we either get or the ones that we seek. So, it's part of the criteria that we set when submissions are made to us. So, there's some work going on at the moment around things like an energy strategy for the region—what that will look like. But I think the key part of your question isn't just about whether all these projects are going to be in the same places; we are trying to cast the net a lot wider. And I think key to the thinking has been: how do we develop not just projects but clusters of activity around certain industries, whether it's automotive, whether it's cyber, whether it's creative, whether it's fintech? And we're starting to see that those clusters can emerge right across the region. Different parts of the region have got different resources and assets that we really need to lever to be able to get that regional spread. So, I don't think it's a case of every area expects to get something, but our strategy is very much about if we have a cluster and we have an anchor to the cluster, how do we support the companies and the supply chains that sit right across the region? How do we make sure, for example—? One opportunity that we have is around research and development testing, and packaging linked to one of our core clusters, which is based in a city. Well, could those new facilities go to the Valleys, or could some of them come across to Bridgend? And it's just making sure that we have that footprint, and we have the sites, we have the connectivity, we have the road infrastructure that makes all of these things work in a much more connected way. 

The economic growth partnership have just published a document, their first document, which is on connectivity, and it's very much about how we can take some steps to do exactly as you say, and think about how we bring all of those things together to get a much wider regional benefit, rather than just benefit for our cities, which is important, but the other places don't just feel the trickle-down benefits. And I think that's critical, isn't it?


And, to add to that, the second publication has just arrived this morning in draft, which is our competitive edition, which talks exactly about improving gross value added throughout the region. But, just going back to the origination point, our investment priorities of innovation, infrastructure, also include challenge. The challenge fund is to address some of the key issues of the world, and particularly those identified in the industrial strategy of clean growth, artificial intelligence, the future of mobility and so forth. Our aspiration is that we will have projects that will come forward trying to address and find solutions to some of those problems. If they take root, they could well end up being an innovation funded project. So, that's another way of creating scale behind projects that will be coming forward. 

Can I just ask, for clarity—? I need a very quick answer on this, because we've got to move on, but you've confirmed there's one project that has already been funded. If we went back 12 months ago, is that in line with your expectation, or would you have expected more projects to be funded 12 months from now, and, in 12 months' time from now, what would be the level of projects that you would be expecting to have been funded by then? I take, of course, the point about you've been working on the foundational phases—I take that point. 

So, Chair, in the last year, we've continued to deliver the compound semi-conductor project. We've developed a Welsh European Funding Office submission around building skills and capacity in the public services. We've submitted twice to the Strength in Places fund on very significant projects—compound semi-conductors, medical devices and diagnostics. We've supported submissions on cyber, creative and fintech as well. We've delivered the graduate scheme. Metro plus is in delivery now, with those first few schemes, and we're working up a position now on the housing fund, metro central and our wider digital portfolio.

So, in the next year, if you take all of those projects that I've outlined here—and, again, this is subject to regional cabinet approval, because they are the decision makers—then we'd expect a good proportion of these to come into the due diligence process for sign-off and legal completion. Now, not every project will cross all of those hurdles, because some things might not be funded and there'll be very good reasons for that. But this pipeline is the one that we now need to realise over the coming years, Chair. 

Thank you very much, and good morning panel. My question is regarding the Cardiff capital region city deal, which is going to create over 25,000 jobs in the next 16 years—£4 billion, very exciting money—and also to achieve GVA of over 5 per cent with that sort of achievement. How confident are you that the city deal will achieve its aim, and what are the main external risks or the challenges to the successful delivery of the city deal?

Do you want to come in on the targets?

Yes. So, the targets, they are for the whole city deal, which includes the Wider Investment Fund that we're here talking to you today about, and also the south Wales metro. So, there are two key components. The south Wales metro is the spine of the city deal in many ways, it takes the lion's share of the funds, and I think we do need to bring that into the picture when we talk about the distribution of these targets across the board. We clearly see it as a key enabling project, and we work very closely with Transport for Wales and the Welsh Government on ensuring that we are aware of how that is rolling out and being delivered, so that the metro plus scheme that Kellie mentioned earlier on is complementary and aligned to the key metro project and shows where we can get additionality from our resources. So, the Porth development and the Cardiff ones are building into that, so that gives you an insight to how we're thinking. The targets: we do need clarity from both the UK Government and Welsh Government on how we are distributing them across the two areas, and, not to put hard boundaries between them, but there needs to be a shared responsibility for the delivery of them. So, that is a work in progress at the moment. We've been in dialogue for the best part of 12 months to a year, and we're still waiting for a definitive answer on how we progress that. We've put some recommendations in on how we think it could happen.


I'm prepared to be a bit more forthright about that, because those targets are for a £1.3 billion city deal project, of which £738 million is attributed to the metro. So, we are responsible for £495 million, and leveraging off the back of that. The £4 billion—it would be ridiculous for £4 billion to be leveraged off £495 million in a financial context, so, I believe that we should be entrusted with raising at least half of that, £2 billion, which would be at least four times the amount of money that we are entrusted with. I think, on the 25,000 jobs—clearly, the economic growth programmes that we're putting into place will hopefully generate the majority of those jobs, so, again, if somebody were to ask me, 'How much are you prepared to take on board?' I'd say, '20,000 of those 25,000 jobs'. But we want good jobs, sustainable jobs. We don't want low calibre, low jobs. We really want to raise the bar and give people good incomes, so it's very important that we have good jobs. And, as far as the GVA uplift, we happily take that on board, the full 5 per cent, because we believe we can generate that.

Okay. Thank you. And what proportion of the total impact that the city deal hopes to achieve will be delivered by the Wider Investment Fund and by the south Wales metro respectively?

We honestly don't know. We keep asking that question ourselves.

So, we are seeking clarification at the moment. We're asking it of UK Government and HM Treasury, but we've also had the conversation with Wales's Government about coming to some conclusion about apportionment of those targets. I think the thing about—

Their responses were: develop a proposal, what you think ought to be fair and proportionate. But I think it needs some real thought and consideration, and we need a consensus view on what feels appropriate. So, we've got some comparators—so, Glasgow is a very similar size city deal to us. Their targets are much lower, but I think there's a bigger conversation about targets, because sometimes targets drive target-driven perverse behaviour, and, as I've said, we could meet all of our targets, but we could miss the point. So, growth is important, but inclusive growth. Growth in the right places for the right people is even more important, so we've got to be careful, I think, not to be blindly led by targets, and to think about doing the right things for the communities that we represent, because that feels much more important, I think.

Thank you for being honest, anyway. What steps have been taken to ensure that the activities of the city deal are open and transparent?

Okay, so, as I explained at the outset, we've tried hard to engage much more widely with the business community, so the business community now are part of the city deal governance, with our economic growth partnership, the business council, the skills partnership. We have an investment panel, which is part business, part public sector. So, as you would expect, every meeting is open— decision-making meetings. Information goes on the website; we've started to develop newsletters now that will go out into communities, which start to tell at a headline level some of the things we're doing and the impact that we're seeking to have. Social media has improved, I hope, over the course of the last year; we've started to do podcasts and get much more information out, in a more engaging than just a broadcast fashion. But I think, as I said at the outset, being very honest, that the work we need to do now is around closing the gap in terms of better community engagement. So, that's very difficult, and there's a lot of ways that we could do that, but that's something that we've put front and centre of the activity now over the forthcoming year.

Yes. I think over the last 12 months, the team has been put in place. We're still building the team. There's around half a dozen of us working on this city deal full time. That's not a huge capacity to deliver everything that we need to do and making sure that we get all of these communications and the engagement side right. But we've got a marketing and communications lead in place since November—October, November—and we're now starting to see some dividend from that dedicated resource. Hopefully, over the next six to 12 months, it'll be a step change, and you will see a marked difference in how we communicate, engage, with our audiences going forward.


Chair, just brief—. It's a brief question. That's great, all that you've said, but I didn't hear this third sector being mentioned, and my obvious question is on your equality impact assessment. We don't want to leave 50 per cent of the population out of gaining from what is probably a once-in-a-lifetime opportunity to secure employment and their futures. So, whilst it's great that you've got this board, I'd be very interested to know the gender make-up of that board, and also whether there's any equality impact assessment that goes in at every stage when you're trying to approve your projects, because this is public money.

Yes. So, an equality impact assessment, a well-being of future generations assessment, goes into every single piece of work. So, it's something new and additional that we've invoked. We're very aware of some of the issues the evidence has told us around things like female entrepreneurship levels, take-up of STEM amongst females, the deficit we have in terms of female engineers in the Cardiff capital region, which is really significant. And I think what we've tried to do is to reflect some of those issues with the make-up of our boards, so, making sure the third and community sector is around the table and represented not just on the economic growth partnership but on the business council—a strong social enterprise role—and on the skills partnership in particular.

Can I just ask, as well, just for clarity—? There are overarching aims and objectives for the city deal that Oscar Asghar pointed out—the 25,000 jobs, £4 billion private investment—but you can't, as the director of the deal, say that we're going to meet those aims because a large part of the project is the metro, which you're not directly responsible for. Have I got that right?

And you're struggling to break—? Well, I don't want to say you're struggling, but there's an issue of getting that split between yourselves and the Welsh and UK Governments; there's a difficulty getting that split about how those two are going to be matched up.

Yes, effectively. So, we're trying to put forward some scenarios and suggestions now to say, 'Here's a couple of ways that this could work'. So, we are in an engaged and productive discussion, but I'm also conscious that discussion needs to conclude to give clarity, because—

So, how do we break that? Because I suspect you're saying you want some clarity from the Welsh and UK Governments, and you want to hear from them, but it sounds like they're saying back, 'Oh, no, but we want you to develop a bit more'. Is that what's happening?

Yes. We've gone back, haven't we, with some scenarios.

Yes. We've to-ed and fro-ed a little bit on it.

Well, we would argue that it's probably in the UK and Welsh Governments' court.

Well, I don't know, to be honest. I think if you look at something like—as Kellie mentioned—the Glasgow city deal, the quantum of funds going in is very similar to the Cardiff one; I think it's £1.2 billion in Glasgow and its £1.3 billion here. And the targets are roughly the same. So, to suggest that we should put all of those on less than £500 million doesn't seem logical or rational when you actually think that the baseline of our economy is probably slightly weaker in the first place than it is up there. So, there's just a degree—. There's an understanding that it's a fair question, I would say, from some people, but we just haven't been able to crack it.

So, just for clarity, in one sentence: what is it you're asking the UK and Welsh Governments for?

Clarification on what targets we are responsible for delivering with the Wider Investment Fund. And it's critical for our gateway review, I would argue.

That's why, Chair, I don't think we're in a position to determine, because we can't gateway review ourselves. So, clearly, I think that confirmation needs to come in from outside.

Dwi'n mynd i fynd ymlaen at yr adolygiad gateway, ond roeddwn i jest eisiau gofyn cwestiwn clou, os mae'n iawn gyda'r Cadeirydd, ynglŷn â'r elfen ryngwladol. Dwi jest eisiau deall, o'r prosiectau yma, sut oedden nhw wedi cael eu penderfynu. Dŷch chi'n sôn am nifer o wledydd gwahanol, ond hoffwn i jest ddeall sut mae hwnna wedi dod o gwmpas, o ran ydych chi wedi trafod hynny yng nghyd-destun strategaeth newydd rhyngwladol Llywodraeth Cymru, ydych chi wedi edrych ar lle mae'r swyddfeydd ar hyn o bryd a pha mor effeithiol ydyn nhw mewn gwledydd tramor?

Er enghraifft, gwnes i edrych ar y wefan ar yr hyn sydd yn digwydd yn India, ac mae yna rif mobile ar gyfer rhywun sydd yn gweithio mewn rhyw swyddfa ym Mumbai, ond dim cyfeiriad ynglŷn â lle maen nhw'n gweithio na beth maen nhw'n ei wneud. Dyw hynny ddim i chi, ond sut ydych chi'n penderfynu lle rydych chi'n blaenoriaethau strategaethau, os bod yna system fel yna yn bodoli ar lefel Llywodraeth Cymru, sydd ddim i fi yn edrych yn rhy broffesiynol ar hyn o bryd?

I'm going to move on to the gateway review, but I just wanted to ask a quick question, if it's okay with you, Chair, regarding the international element. I just want to understand, from these projects, how they had been decided. You talk about many different countries, but I'd just like to understand how that has come about. Have you discussed that in the context of the new international strategy of the Welsh Government? Have you looked at where these offices are currently and how effective they are in overseas countries?

For example, I looked at the website and at what's happening in India, and there's a mobile number for someone who works in some office in Mumbai, but no address as to where they're based or what they do. That's not for you, but how do you decide, therefore, where you prioritise these strategies, if there's a system like that existing on a Welsh Government level, which, to me, doesn't look too professional currently?


Thank you very much for the question. I think where we've got our evidence and data from—. We commissioned some work called analysis of priority sectors, which the chief statistician, chief economist, Cardiff University and others contributed to. So, they did a detailed piece of work in terms of our sectoral and our cluster priorities. So, they used different methodological tools like location quotients, for example, to say, 'This is where you've got these thriving business hubs.'

The reason why we identified the priority sectors we did was really based upon what we have now, but also future projections and forecasts in terms of where some of those markets were going. I think we did input into the international strategy, and the three priorities in the international strategy—around cyber, creative and compound semiconductors—are three priority sectors that we've also identified on the basis of that evidence.

But I think in terms of your point about internationalism and making those international links, for us, we're finding there are big opportunities in the anchor companies, but more so in the supply chains. One of the pieces of work that we started to do, but we need to do more around, is understanding the nature of those supply chains and how we can impact those and how we can make the big anchor companies and the big inward investors have more responsibility for developing those supply chains, because that's where a lot of the jobs growth will be. 

So, I think in terms of relationship with the international strategy, we do have those sectors aligned, but there's a lot more work that we need to do. So, one of the projects that the economic growth partnership has considered recently is becoming part of the GlobalWelsh diaspora, so we have those linkages out around the world, so that we can talk to people on the ground, so that we can join up when they're launching their new international hub—they've just done a Beijing one—we've got our own contacts on the ground that we can liaise with and try to develop some of those understandings that you absolutely spoke about.

Rwy'n mynd i fanylder o ran y projectau, dwi ddim eisiau gwneud hynny, ond rwy'n credu hefyd, yn ogystal â'r disapora, y dylid edrych ar efallai rhai o'r mewnfudwyr sydd wedi gwneud eu cartref yma yng Nghaerdydd sydd yn gwneud busnes yn fyd-eang, ond sydd ar hyn o bryd efallai ddim yn rhan o unrhyw fath o rwydwaith, a fyddai'n gallu eich helpu chi.

O ran yr adolygiad gateway, dŷch chi wedi sôn am hyn, a dŷch chi'n sôn hefyd ei fod e wedi newid o beth oedd e ar y cychwyn, a hefyd eich bod chi wedi rhoi hyn mewn tystiolaeth yn San Steffan yn y pwyllgor yna. Allwch chi jest esbonio tipyn bach mwy am hynny, sut mae e wedi newid, a sut mae hwnna'n effeithio arnoch chi mewn ffordd weithredol?

I am going into detail in terms of these projects, I don't want to do that, but also, as well as the diaspora, I think we should look at some of the incomers who have made their home in Cardiff who are doing business world wide, but currently aren't part of any sort of network, who could help you.

In terms of the gateway review, you have mentioned this, and you've also mentioned that it has changed from what it was at the outset, and also that you have put this in evidence at Westminster in committee there. Can you just explain a little more about that, how it's changed, and how it's impacted on you in general?

You want to fully understand how the gateway review is evolving.

Changed from being one thing to—. I think it was Kellie who said that it evolved into a series of different—

I think that's still an evolving piece. We're not fully clear exactly how it's going to settle down, which is one of our challenges, but what we are seeing is that—. We're hoping that it will move away from, 'How much money have you spent?', to, 'What are you doing to put the right conditions in place to make the economy of south-east Wales much more resilient in the long term and making the right investments?'

So, I think the work that we've done in the last year or so should be recognised in terms of adding a clarity of thought and industrial leadership to our strategy, industrial leadership to the investment framework and, importantly, to the pipeline of investments that are coming through. The next stage, really, is to show that this is evidence based. There's a report that was out, that we've alluded to earlier on, last week; there's another one coming out next month, we've just had the draft this morning, on competitiveness; and there'll be a third one in March on resilience, looking at south-east Wales, the Cardiff capital region, as a region, as an entity. Up until now, there was no data available for the region of any significant value, so I think we are moving all of that. That will give us a much better evidence base to do the right things going forward, and that should be recognised.

The pipeline is looking reasonably healthy for the next few years. We've set our own targets, as Frank has said, to approve between four and six projects with a funding value of approximately £100 million attached to them. So, I think all of that needs to be recognised as what's going on, along with the money that we are also pulling into the region. This is not running down a grant. I think that's an important message to get across. We are looking to leverage and co-invest. By layering these investments, we get the added value out of them. It's not a piecemeal approach where, 'We've given x to one cluster, now that's their turn done; let's focus somewhere else.' Let's get a concentrated strategic approach, where public sector, private sector, the HE/FE sector, and where appropriate the third sector, are engaged. Just to respond to your question earlier on, I did have a conversation with the WCVA yesterday about something that they're thinking about. It's early days, so we'll see what comes of that in due course.


Just to go to your question about the gateway, there are three reports now. We've had the first one, the baseline report, which came back with some fair points but was broadly good; we're due a second one now; and then the third one is the one-year-out report, which we'll get directly before the gateway review, the seminal piece.

But there are some frustrations, frankly, around the process. So, should we be measured on money out of the door? Should it be about the money that comes through the door? Because we want to create value, we want to grow a fund here. Should we be measured on having an evergreen fund and the fact that the money can be recycled so there's more opportunity? I think we should.

But in terms of some of the process and the targets we're measured by, I don't feel that they may take some of this into account. I'm told there'll be an opportunity for us to present a narrative and a self-evaluation, so I've started putting something like a self-assessment together in readiness for that. But I do think the narrative needs to change if we're going to capture the real value to real people, rather than this set of anonymous targets. I think it has to be made more meaningful.

You've mentioned a lot of documents, and for the lay person that's a lot to take in. How many more assessments are you expecting? Because if you're going to have constant assessments, then how realistic is it for you to implement the work that you're trying to do? I know that both are important, but you've got to actually get the projects up and running, get them working, and then you can assess down the line, I would have thought. But it seems you're doing a lot of the assessment before you've got—. I don't know if I'm interpreting that.

No, you're right. We're having to do continual self-assessment, I think, to have self-awareness. We are due two more assessments now in the run-up to the gateway review. So, yes, there are pros and cons. It's good to have the constancy, but as you say, we've got to have time to do and deliver as well.

Unlike some of the other growth deals, which are project based, this is a very different thing. It's something that has never been done before. We started with a blank piece of paper and had to come up with good ideas that all gel together in terms of connectivity; not just in physical connectivity, digital and transport, but also cohesion at all levels of Government on policy, and also bringing together all of the sectors—the third sector, the education sector, the business sector, the public sector. Without all of that, we will not become investable.

To your point about the overseas international strategy, that is also about bringing foreign direct investment into this region, and already we are starting to see some significant projects, particularly on the back of the compound semiconductor cluster, where one of the largest companies, if not the largest in market value—and I can't mention their name because of confidentialities, but you'll all guess it; you've probably got one in your pocket—is already looking to feature very strongly in that sector. And that is because the investment in compound semi, in its own right, is the future.

The internet of things, driverless cars, the future of mobility, will all depend on one thing: computer chips. And if we're making those in this region, then we have a very good future ahead. The reality is that a lot of the European and other countries are looking to have their chips made this side of the Indian and Chinese ocean, and that's because they want to protect their intellectual property. So we are, I believe, doing the right thing by that.

And to the point of scale, one of the things that is vital in our plan is that we actually put significant sums of money into these projects, not that we sprinkle it around like fairy dust and hope things will grow. We really have to get out of that mindset and do things on scale, because scale will actually help us get a much better result. 


To give some signal of how that has been perceived globally, Xiamen, Singapore and the Taiwanese have approached us. They've come to see us, based on the investments that are going into the compound semiconductor. One of your questions earlier on was how do we decide and choose these, well, actually, industry is telling us where to go. It's not about a strategy or a public document that dictates, it's from the ground up, and I think that's really quite powerful to show people. They wouldn't waste their time coming here if there wasn't something to be seen. 

Kellie, when you were here last year in committee, you did talk about the fact that one of the goals of the city deal was to recycle as much of the initial capital funding as possible, but that the impact of recycling funds would not be taken into account in the UK Government's assessment. Is that still the case?

We keep having the discussion, and we're quite forceful. One of things—and again, regional cabinet has showed strong leadership on this—is that this isn't a fund we want to spend down. If there are not going to be any more city deals and regional investment is going to be constructed very differently in the future, then we need to be positioned to leverage that in the best possible way. I think if we can co-invest and show that we're able to put money on the table alongside lots of other investors, then our fund stays alive, it stays growing, it stays revolving, which I think is a really important principle. I do think that needs to be recognised, because we're trying to build resilience here and, as Rhys said, not just spend down the money. 

I don't think it will feature as part of one of the assessment criteria from a UK Government perspective in the gateway review, but I'm told that we can put forward our narrative descriptor of some of our key principles and value sets, which we will certainly do. 

Thank you, Chair. I'd like to dig down a little into how the deal is going to align with Welsh Government and UK Government strategies. So, firstly, with regard to the Welsh Government's regional economic frameworks that are due to be published in March, to what extent have city deal projects been identified to actually tie in with that?

We've got the first session tomorrow that we're going to on the regional economic framework, and I think we'll see it then. I think the idea is that our regional economic plan and the regional economic framework should dovetail, and then we can have an agreed set of priorities that will be able to guide some of the projects and proposals. So, this has drawn very much on the economic action plan and the UK Government's industrial strategy and the four grand challenges. I think the job of work now is to align what we've done with the regional economic frameworks, which I haven't seen yet, but I'm sure we will see at the meeting that's been arranged for tomorrow. 

Okay. So, following on from that, how much direct involvement has the deal had in the development of those regional economic frameworks for the region?

We've got a workshop session tomorrow, which Rhys and I are attending. There's been some engagement with the regional economic growth partnership about the framework, but I think the formative engagement probably starts properly tomorrow, I think.

If it's any consolation, we have the same footprint as the chief regional officer for south-east Wales and he has endorsed, at one of our board meetings, our industrial plan and has actually said that he buys into it and he has no issue with it. I'm hoping that we will avoid duplication, because duplication is a waste of resource and time. There is plenty of work already being done that could be subsumed into that framework, but we haven't seen it thus far, so we're looking forward to seeing it. 

We are having lots of conversations. I meet with the chief regional officer regularly. For example, the work we're trying to do around clusters and building supply chains and links around key industries, the chief regional officer for south-east Wales has very much bought into that and we're trying to co-develop our priorities in that way. So, I think there's a lot of cohesion and I don't think these things are going to be miles and miles apart. It's the same evidence; they should be the same priorities, I think. 


Okay, and my final question, then, is about jobs. Could you outline for us how the city deal will seek to improve the skills and quality of jobs on offer within the whole region in order to benefit those of greatest need? 

Yes. I think that the skills and talent development bit is just massive, and I think there are skills shortages, skills deficits right across the place. Frank, you spoke about software development and STEM, but in terms of some more practical things as well, we're finding some gaps opening up. So, I think what we're trying to do at the moment is take a sector approach to building those skills. We've got the graduate scheme, which is good—it's up and running and it's trying to reverse brain drain—but that's at the higher end. Lots of those young people may have done well anyway, so what we're trying to do now is focus a lot more on schools. We had a proposal that was heard this week at the regional economic growth partnership for a comprehensive approach to connecting entrepreneurs to our schools right across the region, because— 

Of which, I think there are already 300 signed up. 

Yes, so 300 entrepreneurs signed up, ready to take part. And the evidence shows that if a young person from a particularly challenging background can have those interactions, they're much less likely to become NEET; they won't fall into it because their mind and their horizons are expanded, and going to university isn't for everyone. Sometimes, there are other options and choices.

There's some work that we've started around shared apprenticeships, because we can have high-value shared apprenticeships linked not just to university courses, but more vocational stuff as well. I think, in terms of our new industries that we're seeing, people don't want qualified graduates, post docs and PhDs. I think there's a massive role for FE. I went to a meeting last week with the college principals and they're educating more people in the 16 to 19 bracket than school sixth forms. They're really tied into their local communities, into their SMEs, into their supply chains, and I think that's a massive untapped opportunity. So, the skills stuff is a really broad spectrum, but we're trying to tie it down to individual clusters. 

Nesta did a piece of work for us and they said that one of the most significant things that we could do is set up a future-ready fund to try and target areas where economic inclusion just isn't happening—people are just too far away. I think that's something that we've started to give some real thought to, but a lot of this stuff is going to have to be experimental; they can't just go straight into programmes, and we're going to have to give some thought to how it's going to work, and the fact that there will be failure and we won't get all of this stuff right. But I think we do ourselves a disservice if we don't try. 

I think allied to that is the digital strategy, because there are parts of our region that are almost deserts when it comes to connectivity in that context. We need to get our digital strategy right into the depths of the region so that everybody can benefit from that.

I just wanted to ask whether we could see the report, because that would be useful. 

Okay. I know in section 8 of your written evidence you talked about the work under way with Cardiff Business School to evaluate progress through alternative measures, not just GVA. Can you just expand on that comment? 

It's work in progress at the moment. We are just looking to see how else we measure productivity because, in essence, it's a measure of productivity across the economy. It's also trying to take a wider view because I think these metrics are driven by a suggestion that all the economies, not just in the UK but globally, are all the same, and ours is different and like a lot of others, so there are other measures that we should be taking into account when we're looking at, 'Is this a good place, is this a productive place to be and to grow your family, live, work and play?' So, we are looking at some wider measures around quality of life, livability indicators. Livability is probably quite a key one because your wages are tied back to how much it actually costs to live in the region, and they're not quite the same thing as GVA.

So, we're just working through that at the moment. I haven't got full sight of exactly where we've got to with that with Professor Max Munday at the moment, but they are working on it, and we're hoping to get some clarity on it over the next quarter. Kellie, is there anything else?


No, I just think it's a really important piece of work, because if we're going to be clear about the impact that we're making on real people's lives—. I've got kids; I've got brothers who need to benefit from this stuff. A GVA metric isn't going to tell the full story, and I think we need that granularity to be able to inform future decision making around the investments that we propose to make. 

And in our piece of work on city deals, we'll be writing to the Welsh Government Minister and the Secretary of State for Wales. Is there anything that you think that we should be asking of them that better supports yourselves?

I think, in the main, yes, there are some issues of clarity, which, I think, a year away from a gateway review, we do need to have settled and we're very willing to play our part in that. For us, it's about investment. We've got a framework set up and established now, we've got fantastic proposals coming through, I believe; I think there could be some real game changers in that if we developed them in the right way.

I think it is about interaction with the UK Government's industrial strategy and industrial strategy challenge funds, having more formative engagement about innovation and our innovation priorities, and a conversation about how we can contribute to the 2.4 per cent research and development target as part of the Cardiff capital region. So, I think, for us, it's how we engage with innovation investment on a much bigger scale, because I think the innovation stuff—. The infrastructure stuff is absolutely important in connecting us, in keeping us, as you say, Frank, cohesive, but I think the evidence shows, where we've got real strengths is around innovation, but at the moment we're not creating the ecosystem to allow those conditions to embed. So, I do think we want more formative engagement with the industrial strategy challenge fund, and some of those big investments, because that's the way we're going to lever the money into our economy that we need to make a big difference. 

No, I think that covered it, thank you. 

That's fine. That was the last question, but Oscar, you indicated you had a quick question.

Thank you very much, Chair. Last year, it was mentioned—I'm going through the documents here—that the city deal was finding it difficult to deal with the Welsh Government. So, what is the position now, because I think the Minister is going to publish, in the next two months, his regional development plan, whatever it is, the economic plan or framework rather? So, what is the position at the moment? I've seen quite a lot of literature that you've shown us, but have you been engaged with the Minister, or is it just yourselves doing this?

[Inaudible.]—to your concluding comments as well if you could capture it. 

Yes. As I say, we have a session tomorrow on the regional economic frameworks. I think we've left the door open, so even though we've had to go ahead and publish our own, and the regional cabinet have signed up to this, we've always said that we should be working closely together to have one framework for the region. 

I think we've got a good relationship. We've got positive and open discussion. I can approach all of my colleagues and peers. We work together well. We've all known each other for a long time and, at the end of the day, we've all got the same aims; we all want to try and impact the Welsh economy and people's lives for the better. 

If I can just say, from my own personal experience, the interaction with the joint cabinet and the 10 leaders has been absolutely fantastic. I meet with them on a one-to-one basis, as well as collectively. I've been on their away planning days and so forth, and to see 10 individuals being as collegiate as they are is fantastic. We are getting very good buy-in and attention. I've already met with the new Secretary of State and the Under-Secretary as recently as this week, who are extremely supportive of what we're doing. I have a good relationship with the chief regional officer.

If I was being completely frank, and that happens to be my name, I would like to see a little bit more interaction with more senior Ministers on this process, because I think we could achieve a lot. And, actually, our plan on cohesion is very much about that. I genuinely believe if those sectors and the policy were joined up, we wouldn't need to do a great deal to change some of the metrics that we're going to be targeted to do. It will come on through its own volition, and I include in that the opportunities that sit around procurement, in feeding our own companies and our own people with the opportunities that sit within the auspices and under the control of the local authorities and Welsh Government. We could do a lot more to help ourselves. 


Okay. Thank you. That's a good note to end on to conclude this part of the meeting. So, thank you all for your time this morning; I greatly appreciate your time. Diolch yn fawr. We'll take a 10-minute break, and back at 10:45. 

Gohiriwyd y cyfarfod rhwng 10:35 ac 10:49.

The meeting adjourned between 10:35 and 10:49.

4. Diweddariad ar y Bargeinion Dinesig: Dinas-Ranbarth Bae Abertawe
4. City Deals update: Swansea Bay City Region

I'd like to welcome Members back. We move to item 4, in regard to our last session on city deal updates. And this session, this last session, is with regard to the Swansea bay city region. And I'd like to very warmly welcome the leader of Swansea bay city region deal, Councillor Rob Stewart. I understand, Councillor Stewart, you've brought somebody with you as well. We didn't realise that in advance of the meeting, so if you could perhaps introduce yourself.


Of course. My name is Martin Nicholls. I'm a director at Swansea council, and lead for the officer side of the city deal at the moment.

Right, okay. Well, thank you both for being with us. I wonder to start with if you—. Councillor Stewart, you were with us 12 months ago, last January, I wonder if you could outline specific progress that's occurred over the last 12 months, since you were last with us.

Yes, certainly. Thank you first of all very much for the warm welcome, and apologies for the confusion in terms of officers, but that's due to some of the changes that we've made in the region.

When we last met, obviously, we were in the process of looking at the recommendations that had come back from the independent and internal reviews. Just to recap on that, the two Governments commissioned an independent review. Once that came through, we accepted all of the recommendations in there and agreed an implementation plan for those. I think the encouraging thing was that the independent review that I commissioned on learning about some of the challenges that we had in the region, the recommendations coming from that internal review as well also matched what the independent review had found.

The majority of those recommendations are already implemented now, in terms of our changes to our structure, how we work, the information that we get, the decision making, to try and make that as robust as possible. But one of the key recommendations, of course, was changes in terms of how the central office, or the administration office, works, the programme office, and the appointment of a managing director or programme director—a lead officer to head up the implementation of the city deal projects. I'm pleased to report that the successful candidate accepted that post last week, and that we'll make the formal announcement on the name of that individual once they've secured a release date from their current organisation. But we got what we believe is a very good candidate, who scored very highly in terms of the exercises that they went through before appointment. So that will give us a formal lead officer, independent—and this was the important point—independent of the chief officers in each of the councils. So there's no conflict of interest now between a lead officer in the council, a project sponsor, and the managing director. So I think that is a real positive.

In terms of progress on projects, that continues across the piece. As I've said before, there are two ways you can look at this. There's the what's formally approved and actually what's happening on the ground. I'm pleased to say there's progress on both. So, the first £18 million was released by the two Governments, specifically for the Swansea digital waterfront project and Yr Egin, in Carmarthenshire. We anticipate, on conclusion of the remaining actions from the independent review, to have a further £18 million released before the end of this financial year, and a further £18 million released then early in the new financial year—so, more before 31 March and more from 1 April. That will give us the equivalent of three years' worth of money, released now, so it gets us back on track in terms of the funding profile.

In addition to that on finances, we've been having positive discussions as well around a more aggressive funding profile from the two Governments. So, the previous original proposal was around releasing £15 million every year over the period of the city deal. That has been raised to £18 million over the early years, and then smaller amounts in the remaining years. We're still discussing with the Ministers—and, obviously, we hope to have a positive initial discussion with the Secretary of State for Wales, Simon Hart, in due course. Because what we would really like to do is to get to a position where the money is released for the city deal a lot faster, which will take some of the pressure off councils having to borrow that money in advance to deliver the projects. And the very basic offer we're trying to make is to say, 'Look, if delivery on the projects is faster, then release the money faster, to match the delivery on the projects.' And I don't think that's an unreasonable position for us to ask. Because again, overall, £241 million of Government money, between the two Governments, is not a huge amount of money in Government terms. And again, an accelerated funding profile would really, really help all of the councils in the region.

In terms of the projects themselves, we are now on site, building the digital waterfront first phase in Swansea. Committee members would be welcome to visit that at any time.

We are delivering a 3,500-capacity digital arena, new infrastructure around it, new hotels. That is enabling us to go to MIPIM, the major investment show in France in March, with our colleagues from the capital region, to offer further investment opportunities within the region for phase 2 of the city deal—so, the city deal working as it should as a catalyst to draw in further investment. We always said that that would be a key objective for us. So, again, we'll be going out with our phase 2 proposals there, and we've already had some interest—significant interest—in investment opportunities there.

Outside of the two projects approved, Homes as Power Stations, whilst it isn't an approved project in terms of drawing down funding at the present time, there are live demonstrator sites for each of the new types of housing, delivered by each of the four authorities. So, each of the four authorities have different pioneer housing models already being built or built, which is enabling us to demonstrate and test technologies that we are proposing to use on Homes as Power Stations. Overall in that project, we're proposing to build some 7,000 houses over the period. So, there is good progress on that project.

I'm very, very pleased to see the Pembrokeshire Dock Marine project move forward to the final stage of approval and we're very hopeful that that will be probably the next one through the door. But, again, coming back to my previous point, one of the things that held up that project making progress to final approval was the funding challenge for Pembrokeshire County Council. And, again, faster funding out of the Governments will help that project as well as others. So, again, we've worked on a way of doing that by re-circulating some money at a lower cost to help Pembrokeshire County Council, but I think that would have been a debate that could have been taken away if we get faster funding.

Outside of that, Neath Port Talbot County Borough Council has revised its suite of projects, because Neath leads on a number of them, including Homes as Power Stations, and I'm expecting those projects to come next month to the joint committee for consideration for moving to final approval. So, every one of the four councils is putting forward or delivering those projects that we promised under the city deal at the moment.


On the Neath Port Talbot project, does that replace the project that Neath Port Talbot council was originally due to lead on?

It's not replacing, but it's refocusing—I think that's the way to see it. So, Homes as Power Stations is a cross-cutting project, but Neath leads on it. Then you had Steel Science and Factory of the Future. Again, what Neath have done there is to refocus those projects and merge, I think, the two projects, or the best elements of the two projects into one. And then the CENGS project—the Centre of Excellence in Next Generation Services one—has been focused a little bit more in terms of meeting both the Welsh Government's and the region's aims in terms of the decarbonisation of the economy and some of the green economy benefits that we want to derive.

Okay. I have to say, you've done a very good job of doing a summary in such a short space of time. That was a very comprehensive summary, thank you very much.

I won't dive into the detail, because Members will have some of the questions, but can I just ask: is there anything in the last 12 months especially that's gone faster or slower than you anticipated that we could just draw on?

Yes, the release of the funding. Obviously, once you have an independent review and then you have to act on that review, whilst the governance changes are important, it has slowed down the release of funding. And where that is a real tension is because the councils are doing what the Governments ask, because Governments are very clear to us, as I've said before, when we were signing this deal, 'We want you to get delivery on the ground going as fast as possible. We want to see the economic changes that the deal can enable.' The councils are doing that—that's the point. The councils are getting on at risk with the projects, and again, from my council, I was carrying spend of over £10 million with no money released into the projects that we were delivering. Now, that is a risk for the council, but we were absolutely committed to delivering. 

So, I think, the only real negative in there is, as I've said: help us to draw down the money more quickly where you can see delivery happening. And again, I'm confident that delivery is happening.

And you've talked, both in terms of the UK and Welsh Governments, about a more aggressive funding proposal, but is there anything else you could talk about in terms of your experience in dealing with both Governments over the last 12 months?

Again, look, elections are necessary, but they can be unhelpful, and again, the uncertainty when a government goes into the pre-election period, that does slow down especially some of the decision making. Obviously, we've had the Brexit scenario hanging over the city deal, as it's hung over everything else—

I'm probably thinking more about conversations you've had—access to Ministers and officials and just general conversations.

Look, I think, certainly, from the Welsh Government's point of view, we've had a regional officer appointed to us by Welsh Government—Mr Rhodri Griffiths. I think he's been excellent and has been really helpful to us in terms of helping us co-ordinate really well with Welsh Government. We've changed our process, so it's not a pinging back and forth between two unequal partners. So, we've tried to make it much more of a partnership. But there is a challenge in dealing with two Governments. There's a challenge in dealing with one Government, but with two is a little bit more complicated. I have to say, things have improved significantly. I think the relationships have continued to strengthen. We've got a very good relationship with both Lee Waters and Ken Skates in the Welsh Government, and I'm hopeful of an even more helpful relationship with the onset of Simon Hart, who has actually been helpful to the region in his previous role as a representative in the region, on things like the tidal lagoon and electrification, which he's advocated from the backbenches in Westminster.


Diolch. Roeddwn i jest eisiau gofyn yn gyflym, os yw'n iawn, ynglŷn â'r ailffocysu yng Nghastell-nedd Port Talbot. Dŷch chi'n sôn am ddur a'r datblygiad yna. Rôn i eisiau gofyn: ydy hynny wedi newid hefyd oherwydd y ffaith, yn amlwg, dŷch chi wedi gweld y newyddion o ran y potensial i fwy o swyddi fynd yn Tata ym Mhort Talbot? Dwi’n deall bod hwn yn gysyniad R&D, ond ydy hynny wedi cael unrhyw fath o impact ar sut mae'r prosiect hwnnw wedi cael ei ailffocysu? Jest oherwydd mae'n rhaid i ni edrych i'r dyfodol i weld sut fath o dirwedd economaidd fydd yn yr ardal honno. 

Thank you. I just wanted to ask, quickly, if it's okay, about that refocusing in Neath Port Talbot. You talk about steel and that development. I just wanted to ask: has that changed because of the fact that, obviously, you've seen the news in terms of the potential for more jobs to go from Tata in Port Talbot? I understand that this is an R&D concept, but has that had any impact on how that project has been refocused? Because we have to look to the future, of course, to see what kind of economic landscape there will be in that area.

I think that's a very fair point. To try and reassure you, one of the red lines, if you like, around the city deal is, if there are changes to individual projects—and obviously, we'd still retain the flexibility if we don't think the project that was originally proposed will meet the aims of city deal—whatever replaces it has to continue to support the overall aims of the deal. So, one of the things Neath Port Talbot are doing with their projects at the moment, even though they're refocusing them, is to make sure they still deliver the GVA, the economic uplift that we require, and the job creation. So, I would see it as a refocusing of the projects, not about saying, 'We're not going to do those any more, we're just going to think up something new now.' It's not that. But again, I haven't seen the final version of those projects yet—they're still waiting to come to the joint committee. And again, once I've seen those, I'd probably be able to give you a much more detailed answer.

Well, yn anffodus, dyma fy mhwyllgor olaf i ar y pwyllgor yma, felly os oes yna ddiweddariad, byddai fe'n ddiddorol gallu gweld hwnnw. Efallai gallaf i ofyn i'r Cadeirydd i'w weld e yn y man. Dŷn ni wedi clywed lot yn barod gennych chi ynglŷn â phrosiectau Yr Egin a'r waterfront. Allwch chi ddweud wrthym ni sut mae'r prosiectau eraill—y naw prosiect sydd yn rhan o'r cwmpawd gwaith—yn mynd i gael eu datblygu? A beth yw'r un nesaf? Ydy Homes as Power Stations yn mynd i fod yr un nesaf i ffocysu arno? Ac ydych chi'n hyderus bod y ddau yma sydd wedi cael arian yn mynd i fynd rhagddynt yn weddol glou nawr?

Unfortunately, this is my final committee on this committee, so if there is an update, it would be interesting to be able to see that. Maybe I could ask the Chair if I could see it in due course. We have heard already about the project of Yr Egin and the waterfront. Could you tell us how the other projects—the other nine projects that are part of this remit—are going to be developed? And what is the next one? Is Homes as Power Stations going to be the next one that you're going to focus on? Are you confident that the two that have already received funding are going to go at it quite quickly now?

A number of elements to that, so please come back if I've missed any of them. Taking your last point first: yes, again, I'd love you to come and visit the project in Swansea. We're confident of completing that project, in terms of the digital waterfront, by the summer of next year, with a full opening before the end of the year. On top of that, the second element of it, which is based in the Kingsway area of Swansea, which is the innovation hub, the planning application for that building has been submitted. The committee in Swansea council will consider that and, subject to approval, we'll be on site building that before the end of the year, and again, open before the end of, I think, 2021 or early 2022. So, I'm confident that the projects in Swansea are on their way. Obviously, phase 1 of Yr Egin is already up and I think over 90 per cent occupied. So, there is really evidence of success there as well.

Again, Homes as Power Stations, I'd invite the committee. It's a really, really positive story around the development of green technologies for housing in Wales. There are a number of sites you could go to in the region with any council. I would invite you specifically to come and have a look at the retrofit that we're about to open in Swansea, where we've retrofitted the technologies that we'll be putting into new houses into existing properties that we've refurbished. Again, it helps us deal with fuel poverty. But I believe we're the only council in Wales retrofitting these technologies into properties. And of course, if we get that right, then it could go into any of the homes that we want to upgrade so they become really highly energy-efficient homes or to eliminate people's energy bills. So, an open invitation to come and have a look at those. But, again, it's ahead of the approval of the formal project. So, I'm confident that we will make really good progress in terms of the delivery of those new houses, those new homes, once the project is approved, because we're already delivering them now.

Outside of that, Pembrokeshire Dock Marine, I'm confident, subject to approval, that that scheme will progress. Digital, I know there's good work in the background on the digital project, the 5G digital infrastructure. That is due to come back shortly. In terms of the health and well-being village, or the wellness village, in Carmarthenshire, I know that Carmarthenshire council are in detailed conversations with new partners on a new proposal to come forward. Again, we await that at the joint committee.

In terms of the skills and talent project, again, that is linking into some of the conversations we're having with people like the Minister for Housing and Local Government on the Welsh Government Bill, in terms of the creation of corporate joint committees. We'll take the opportunity there to try and align some of the structures, because we work on a different footprint for education and skills than we do for economic development. Again, I think there's a very strong argument for saying that, if you want to build the right economy in your region, you need to have your skills and education footprint aligned to your economic footprint. So that's one of the proposals we've gone back with to the Minister, to say, 'Look, we've got an opportunity here to try to make sure that we've got the right footprint supporting the economic structures, the educational structures.' But, again, the skills and talent project will come forward in due course.

It comes back to the point that, under the current funding formula, there's only so much money in the pot to support these projects. Again, that's why were saying, 'If we can demonstrate really good progress on the projects and if we can get more to you for approval more quickly, then the return for that should be you release more money more quickly.'


Ie, dyna roeddwn i eisiau gofyn, rili: ydy hynny wedi effeithio arnoch chi mewn ffordd negyddol, y ffaith nad ydych chi wedi gallu cael yr arian wedi ei roi ichi gan Lywodraeth San Steffan? Rydych chi wedi dweud eich bod chi'n 'frontload-io', rili, gyda rhai o'r prosiectau yma, eich bod chi'n paratoi'n barod. Beth ydyn ni'n gallu gwneud i helpu i sicrhau eich bod chi'n gallu parhau gyda rhai o'r prosiectau sydd ddim wedi digwydd eto, er mwyn eu hwyluso fel eu bod nhw'n gallu digwydd yn gyflymach nag y maen nhw ar hyn o bryd?

Yes, that's what I wanted to ask, really: has that affected you in a negative way, the fact that you haven't been able to get the money released to you from Government in Westminster? You've said that you're front-loading, really, with some projects that you're currently developing. What can we do to help to ensure that you can continue with some of these projects that haven't yet happened, in order to facilitate the fact that they can happen quicker than they are currently?

I don't believe there's anything that's really held up the project that a Government has done; however, if we hadn't taken brave decisions as councils in the region to commence with delivery, to take the risk, then potentially we would be a lot further behind. So I think there hasn't been that direct impact. What I would say, though, is of course that, as more projects get approved and more projects start to spend lots of money, then there's only so much money that's in the central pot in there to support those projects and that's why we're saying, 'Look, if you as two Governments have said, "We have now got to the point where we've approved eight of your 11 projects, then let's release more money upfront to help you to deliver those eight of 11 projects, not place the pressure of you having to borrow to deliver—

We accept, as councils, we were always going to have to pre-load this and borrow, but no council will come to any committee in Welsh Government or the UK Government and say we're swimming with money, because we're not; we've been through austerity for many years. But, we understand that we have a role to play in generating jobs, in diversifying our economy. We're prepared to do that, but help us by taking some of the financial pressure off us. 

Thank you very much, Chair. Good morning to you. My question to you regarding the Swansea Bay city deal is: how satisfied and confident are you that the city deal will achieve its overall ambitions of securing £1.3 billion, including a £600 million private sector contribution, and a £1.8 billion contribution to regional GVA, and the creation and delivery of nearly 9,500 skilled jobs? And the word 'skilled' I'm emphasising strongly, because it's quality or highly skilled jobs. How can you explain that?

In terms of the projects we have and the ambitions we've set, I'm confident that we can do that. I would hope, in terms of inward investment, if we get it right, as we're starting to demonstrate in Swansea, where you build the right proposal and then you're able to build additional schemes around that, you can then secure additional investment over and above it. The money from the Governments was always intended to be a catalyst to make the economy grow faster, for us to grow and create those jobs, create those opportunities. 

I think the one concern I have is that nobody knows yet what sort of trading arrangements we're going to have with the rest of the world. So, getting the right Brexit arrangements post 31 January is absolutely key to this, because, if we get the wrong deal, if our trading arrangements are far worse than they are now, then that's going to harm our economy. Again, we can only do so much, but if we're facing an even greater uphill battle—because, remember, Wales has been lucky enough to be a net beneficiary from Europe—we need to get the assurance on the shared prosperity fund from UK Government as quickly as possible, and we need to see a greater share of the money the UK has coming to Wales to support our economy. 


Thank you. You mentioned Wales as a beneficiary of European funding, but, overwhelmingly, Wales voted to Brexit, so that's another scenario. What are the greatest external risks or challenges to the successful delivery of the city deal—I mean your city deal? 

Again, challenges to delivery—I think we've got the right structure now. As I said, we've made a key appointment as well in terms of trying to get the right person to lead on the programme office, to make sure that we've got those dedicated programme skills there to manage the projects as they get approved. I think the economic wins are the biggest worry, as I've said before. Key to that is getting the right deal with our biggest trading partner in Europe and what other deals are struck around the world. It is important—. Brexit—whether you were for or against it, the uncertainty of what it was going to create was the biggest killer for the economy, the uncertainty. We now have a level of certainty that we're going to leave, but we don't know what we're leaving to, and the sooner we can get a clarity and confidence in that, the sooner we can plan for it. 

Thank you very much. Can you outline how project sponsors are financing the investments they are currently undertaking in their projects in advance of the release of city deal funding? What risks does this present to project sponsors?

Okay. So, in terms of project sponsors, I'll use Swansea, because that's probably the biggest number at the moment. We've taken a decision to borrow some £80 million upfront. It's a big decision for a council to borrow on that scale, but I'm glad our finance officer and our technical officers decided to make that transaction when they did, and that we were able to approve it, because, of course, the Government in London has since raised the rate for the Public Works Loan Board. Just to put it in context, we would have picked up costs of £45 million extra if we were to borrow at today's rates compared to the rates we borrowed at just a few months ago. That's the difference that going from 2 per cent to 3 per cent makes. So, I think we borrowed at the right time.

So, again, it demonstrated commitment from us that we were intent on delivering the scheme but, again, what we are building should deliver not just extra jobs for the region and extra opportunities for people in there, plus bring in the additional private investment on top of that, which is what I referenced earlier, but it makes us an investable place again, which—. Part of the reason why we struggled in Swansea for so long was that it wasn't attractive for people to invest. The sorts of changes that we're making now, we're seeing—. You come to Swansea now, there are 11, 12 cranes in the sky; we haven't seen that for over a decade. It's a signal of private sector investment coming in on the back of the decisions that we are taking both as a council but also as the two Governments.    

Just to add to that, one of the things—and it also links back to the earlier question around the approval of the business case process—. It has improved, but, if there was a concern, it needs to continue to improve to speed up the approval process once the project is ready to be delivered. And the other challenge that brings, as Councillor Stewart has said, is there's no money available to do that detailed feasibility work. So, individual sponsors—local authorities and others—are proceeding at risk with sometimes quite substantial sums of money without knowing whether that business case is going to satisfy all of the requirements when it's finally submitted. That's not usual in terms of major capital projects. For many other projects, like the schools programme, money is available as part of the feasibility programme to work up the detail, so then you've got greater clarity and certainty over costs and delivery timeline, rather than it being the individual sponsor having to proceed at risk with some quite significant projects and some innovative projects as well. 

Good morning. I want to understand the approach that's going to be taken in terms of monitoring and evaluation for the Swansea bay city deal. You've given us written evidence and it does state that the monitoring and evaluation framework is currently under development. So, I'd like to know what has happened in the past 12 months in terms of that. 


So, Martin can add to this one. But, look, there's monitoring and assurance and scrutiny at all levels of this. So, if I just take you on the journey of the Swansea one, well, of course, if we're going to do anything as a city council, we've got our own internal processes to go through—that's taking it through all the legal, financial, political processes to get approval before we can even then take it to the regional boards for approval. Within that, there will be scrutiny across the council, as well as audit committees looking at it at the local level. Likewise then, in the regional committees, you have various tiers. So, you have a programme board, made up of the chief executives and key officers. You have an economic strategy board, made up of private sector individuals, who bring their private sector expertise to look at the business cases and delivery of the projects. You have the joint committee, which is the politicians, the regional politicians, plus the regional partner representatives. And, again, as you would in a council, or a Government, you then have your scrutiny panels and scrutiny organisations as well looking at the delivery of those. So, you've got a regional security panel that meets regularly, drawn from all of the four councils. And you also have, obviously, other functions that will look at how delivery is progressing.

In addition to that, you've also then—we've got the set-up of the new programme office, where, once we have the new programme director in place, their first task is to look at the skills requirements to bolster that office. We have some good people in there at the moment, but it will be for the new programme director, or managing director, to say what else they need to help them make sure that they can help manage the successful delivery of those projects. And then what we've taken an opportunity to do, as part of the recommendations from the independent and internal reviews, is just to look again at our processes within both the councils and the city deal to make sure there aren't any conflicts of interest in there, that there is a good separation of roles, and that we're getting the right information to the right boards at the right time, so that we can make the right decision making. So, all of those things are part of making sure you have successful delivery, but, as you can imagine, that's quite an industry in itself. But it does mean that you can certainly demonstrate there is significant scrutiny assurance of what we're doing at all levels.

I think it's probably safe to say that one of the recommendations that came out of the reviews was that that framework was not well established, and that now has been set up on that formalised basis. One of the key requirements for the programme director, and then the programme officer and office, is to implement that clearer programme of monitoring. So, it probably wasn't as formalised as it should have been, and that's one of the recommendations that's been picked up and agreed. The only thing I'd add to that is that we're not at the stage yet where we're evaluating implementation; we're in the process of implementing. And it links back to the previous question—how are we satisfied that what was set out within the original deal will be delivered? So, that implementation loop and feeding back in terms of the monitoring of delivery, of the job creation, and the local spend and the local job growth, is a key aspect of that evaluation. But we're not at that point, certainly with the Swansea project, where that actually has kicked in yet, because we're on site at the moment.

One point I would also draw your attention to is, of course, you could look at the review needing to be done because we'd made decisions we shouldn't have made. Actually, if you look at the timing of the review, no projects had been approved at that point, so we were still in the point where projects were making their way through. So, you could argue that some of the reasons for calling the review were identified very early in the process, which is, I would say, a good indicator that we detected stuff early.

Okay, that's fine. I want to know whether you'll be seeking to use measures that assess not only the scale of the economic growth—that's great, and it's much needed—but the impact that will have on the well-being and the socioeconomic of the citizens in that whole region.

Yes, absolutely. And, look, making sure that this spend has the biggest impact, not just economically but socially, is hugely important to us. As I said, there are various measures to this. Again, I'll give you an example in some of the measures we've taken with the projects that are currently approved. So, in Swansea, again—it'll be the same on other projects—obviously we look at keeping the spend as local as possible, and structuring the contracts in a way that benefits local businesses and local people. So, whilst, because of the scale of the arena, and because of the technical nature of the arena build, we've gone to appoint Buckingham, who are not a local firm, as the prime, the way we structured the contract then means that all of the packages of work—some 200 packages of work under that—are then offered in meet-the-buyer events to local companies, local trades. And, where the local trades can't support those, again, if they're going to a firm that's outside of the local region, then they will need to demonstrate how they're employing local people as part of the workforce for the contract that they're picking up. So, it's a multi-tiered approach. I think, at the moment, Martin, we're expecting at least 70 per cent to come through, but, through those measures, we think it'll be significantly higher than that—so, again, keeping the spend local, keeping the benefit of the investment as local as possible, so it helps with not only building the skills but growing the companies in the area, growing the workforce.

In addition to that, you have the direct impact, then, of the projects, and, again, I'll come back to things like Homes as Power Stations. Well, we're not just doing it to create a better opportunity for the construction industry and trades in the area, but, of course, what we then create has an environmental benefit in terms of we have houses that draw less energy from the grid and are more self-sufficient. For the people who are living in them, they will largely be people who are on our housing waiting lists, people who are not currently housed, or are awaiting a safe, warm home. So, they get a nice new home to go into, and, when they go into it— because they may be people on low incomes or not in work—we're removing one of their major bills. So, where they would go into a property normally and have a bill perhaps of £1,000 or more a year, they're getting an electric bill or a heating bill of £70 a year—so, it's dealing with fuel poverty, again allowing people to have more disposable income, especially if they're on low wages. So, it's a multi-tiered approach across the projects to not just drive the economic change we need but also the social impacts are there to be measured as well. Martin, do you want to add to that?


Just to add that I think consistency's really important. I think—. You know, four authorities and other bodies collaborating to deliver a range of projects—one of the things that's key is to get some consistent procurement principles, and that links in, then, to the targeted recruitment and training and apprenticeship opportunities and working and expanding on the projects that we have already in the region, a couple of shared apprenticeship schemes, where the opportunities for that growth are shared across the region. I think it's very important for developers and contractors and other partners who want to work for and in the region that they're aware that there is consistency in how as a region we will procure. Those headline principles in terms of those procurement methodologies have already been shared with the joint committee, and I believe they're due to be finalised and formalised in the spring. So, that means we'll be able to publish those formalised principles.

Finally, this links back to the previous discussion around the skills strand, and the skills strand clearly needs to underpin—I think it probably needs to catch up a little bit, because we have projects in delivery and yet the skills aren't there, but we know that that's coming in the spring in terms of the final business case, and that is very clearly linked to the regional learning and skills partnership work anyway.

Right. I'm really pleased to hear that. You've got to put skills with procurement with pipeline. I'm chair of the all-party group on construction, and it's exactly what they were telling me on Tuesday morning at eight o'clock.

The other question that I have for you is on the make-up and composition of the board that's deciding projects and any balance that has been achieved on that board, because I know, if it's local authority, you haven't got many women. I used to be a Pembrokeshire county councillor and I live there still, so I don't expect, by composition of local authorities, to see very many females on the board, but, if you're going to tell me that's different, that'd be great. But I am concerned, absolutely, that we have diversity on the board and then diversity all the way down to an opportunity to influence the projects, but also the outcomes. I know about Cyfle, because they're at the very start. I also know, unfortunately, that there aren't that many females on that.

Very happy to answer that one: I just want to check with you, do you mean gender diversity or true diversity?

I mean gender diversity, I mean diversity more widely. But I'm not going to go into that trap: if women make up 50 per cent of the population, I expect to see a fair representation of females. 

Okay. I'm just checking, because, again, under the law, we have seven protected characteristics, and true diversity means that you also encourage people of ethnic background, disability—

No, I'm just checking I've got the right context for the question, because I do get irked sometimes when people only focus on gender, because we have a job to do make sure that we get other protected characteristics and other groups into our committees so that they can represent the sections in their community fully. 


In terms of the city deal, yes, at the current point in time through democratic election, the seven leaders of the local authorities are male, including myself. In terms of representations at the board, the ABMU chief executive and chair are both female. In terms of the universities, the two vice-chancellors are male at the present time and Cwm Taf's—sorry, yes, the other health board—representative is female. Below that, the economic strategy board has a mix of male and females, but we are expanding that board in terms of advocates and advisers, and again it's a very strong gender mix in there in terms of the sector leaders, from various industry partners who are interested in joining the work of the economic strategy board.

In terms of the programme board, and that structure, obviously one of the four chief executives has changed recently and become—. Wendy Walters is now heading up Carmarthenshire. The other three chief executives are currently male, and in terms of the officers, which then support, the majority of the staff I think in the regional office currently are female, certainly at senior level, but, again, we'll wait to see what the news is on the appointment of the managing director. What I would say is, in terms of gender balance, we have attempted where possible to ensure that we respect that, but also that we appoint the best individual for that job.

Well, we have to under the law. Again, I'm not going to break the law to achieve an aim that looks good in a photograph. So, what I would say is, again, we can't be blind to true diversity—

Joyce—sorry, Joyce—if Councillor Stewart finishes his point, I'll come back to you. 

Thank you very much, Chair. I'll just remake my point. I think, as politicians, we have an obligation to represent all sectors of our community, and I absolutely am proud especially of the steps that my council has made in terms of gender equality, where we have achieved near 50:50 balance, certainly in my group representation. But we aren't doing a good enough job of representation from other groups and that's where I would like to see us put some effort. 

I do want to come back. I just want to simply say: this was my question, you've answered it comprehensively in ways that I don't agree with, but never mind, that's life. What are you doing—and I asked the same question to Cardiff, so I'm not picking on you—what are you doing to actually ensure that there is gender balance within your board? But you can send us a note on it, because it'll take time. Thank you. 

I think Councillor Stewart has answered that question. So, I'll come to Vikki Howells. 

Thank you, Chair. I've just got some questions around the extent to which the deal is going to align with Welsh Government and UK Government strategies. Firstly, when we're looking at the Welsh Government's regional economic frameworks that are due to be published in just a few weeks now, in March, to what extent have your projects been identified to tie in with that? 

Yes, very much so. So, the two major economic strategies launched by both the Welsh Government and the UK Government, again, we've mapped out how our city deal sits within those. I think I said jokingly that previously there was a bit of plagiarism in terms of the UK's economic plan, because it did seem to measure very well against what had already been published by us as a city deal. But, no, I think we are well aligned to both of those.

In terms of the regional frameworks, again, Martin can say more on that, but I think we've got a very positive story to say on that, in terms of how we're aligned to those frameworks.

Yes, I can. We've had several discussions with Rhodri Griffiths and his team around what we are doing as a council and as a region, and I know he's met with all the other regional partners. We've fed what we are doing and what the city region is doing into that framework, and very much that's been a very healthy dialogue, and we certainly believe that the views that we've raised have been taken on board as part of that emerging framework. So, it is very welcomed. It's not something that's always happened in the past, when centralised policies or guidance are issued, so it is very much welcome, and I think it does demonstrate the strength in the regional officer and regional office approach, in terms of linking directly in with the region, as they're developing those frameworks, so very much supported. 

Good, okay. Could you outline the role of the city deal's economic strategy board, which is led by the private sector?


Yes, certainly. So, again, it's important that we have a strong and functioning partnership with the private sector as part of delivery of the deal because they are key to bringing not just the right partners to deliver the projects that we have agreed, but part of the economic strategy board's remit as well is a bit of horizon scanning, and that's why, in my previous response, I said we were looking to expand some of the advocates and advisers who will play a part on that economic strategy board. Because what we want are good sector leaders who can give their experience and expertise into that economic strategy board, where it will help us not only deliver the projects we have, but look at inward investment opportunities or other opportunities to add to the city deal.

Again, I wouldn't want us, as I said before, just to deliver what we've set out in the original document. Our ambition should be to exceed that, to go further. I'm a key advocate of both the lagoon coming back as a project, potentially able to be delivered regionally, and, of course, we're working on the south-west Wales metro proposals at the moment with Welsh Government, and that project could well become a further project that could come under the delivery mechanisms of the city deal. But the economic strategy board is key to that because politicians or public sector workers won't have all of the experience that's needed, sector by sector, to deliver the best outcomes that we possibly can with each of those projects. So, that's what the economic strategy board is there to do. They help to advise us, they help to guide us, but they also have to improve and get the best outcomes for the projects.

Hefin David. No. Can I just ask Councillor Stewart some follow-up questions on Bethan Sayed's questions? Just for clarity, how many of the city deal projects are still developing or finalising their business cases, just so that we've got that on the record?

So, two are approved, so it depends how you look at it. If you want to say how many are not approved, then there are nine not approved yet, but each of those will be at different stages of approval. And I would say that we've probably got seven that are in the final approval stage. So, two approved and then a further five waiting to be approved. And then a further four, which are probably a little bit further behind, as Martin indicated.

Have you got some rough timescales on when those are likely to be approved?

We are at the will of the UK Government and Welsh Government for those. I mean, we wouldn't have submitted them for final approval unless we thought that they were nearly there in terms of getting that final tick in the box. And just to be clear, that's the Pembrokeshire Dock Marine project, the three revised projects from Neath Port Talbot, Homes as Power Stations, and then closely followed by the skills and talent and the digital project.

And in terms of the delay that you mentioned, in terms of the UK and Welsh Government funding, has that had any impact on those projects in terms of levering in private sector investment at all?

Not directly, but, of course, having had no money released up until last summer did give us some problems with the private sector because, of course, part of this is about confidence, and, again, having had a review under way, having no money released at the time, made it more challenging for us to convince private sector partners to invest more readily. But, of course, both of those things have now been resolved. I haven't seen evidence of any private sector partners walking away in that period; people still remain as committed. But again, they're keen to get on with this, as keen as we are. So, again, I come back to my core point around faster funding being of benefit to all.

Perhaps you can't answer this question, but when do you expect all projects to have secured the funding from the UK and Welsh Governments?

I wouldn't want it to be more than a couple of years. I think we should be very ambitious with this. You've got to remember our city deal is different from the Cardiff capital region deal. We were asked to define 11 projects upfront before having any money or the deal signed. The capital region were given a quantum of money, they had the metro scheme, and then they've been defining their projects after the deal was signed, and they still have the flexibility to do that. So, they're very different processes.

We would argue that our projects are already worked up to a relatively good degree of detail. But, of course, after the deal was signed with the May Government, with many of the officials in the Treasury in London and elsewhere, of course, not only did the Government change, but many of the officials changed, and then you get into that final approvals process with new people—the same set of questions being asked but by different people—and as Martin said, that process became pretty unworkable. It has improved greatly and, again, we will bring forward the projects as fast as the Governments can deal with them. But part of the problem up to this point as well has been capacity in the Governments to deal with the evaluation of the projects that we're bringing forward.


You don't think there's sufficient capacity in both Governments to deal with the projects that you're bringing forward to—

It has improved, but one of the requests from the Governments was to provide, if you like, a more detailed pipeline of when things were going to hit them, and underpinning that was, 'Can you bring them to us in a more orderly order, so that we have the resources to deal with them more strategically?' But, again, our original aim was to bring them forward as quickly as possible.

Okay. So, just to clarify in terms of both Governments, do you think there is a resource issue in being able to analyse the projects that you're bringing forward to them?

It's much better than it was. They've co-ordinated better, they've set their end up better, but if I was to dump the other nine projects on them tomorrow, I don't think they'd have enough resources to deal with all nine.

Thank you very much. Same question: you mentioned the high-skilled jobs, 950 or nearly 1,000 to be created in the Swansea deal. So, which area are you looking for? Hi-tech, procurement, are they local or coming from somewhere else? How are you going to create these highly skilled jobs? I'm not saying 'skilled'; the word is 'high-skill'. Could you explain a little bit about this, please?

Yes, certainly. Well, part of the aims of the city deal is around the diversification of our economy. We are highly reliant on public sector jobs in the area, much more than most regions. So, we have to create growth in the private sector, but also in the areas of growth for the new economy that we're creating in Wales. They have to be green jobs, don't they? They also have to be in sectors like digital, like the new technologies that we create, and that's why the fifth-generation test bed and the project that delivers the new networks are core, not just to job creation, but to a lot of the project delivery.

At the present time, we are growing skills, and again, there should be no disparity of esteem here in terms of what we're creating, because if you are creating opportunities in the workplace for plumbers, electricians, construction workers, those jobs are no less skilled than your academics or your digital entrepreneurs or all the others. So, there has to be that parity of esteem there. Obviously, because we've got two projects under way at the moment, approved: one in the construction industry partially at the moment, because we're in the phase of construction, as Martin has said, so we're building the new infrastructure for the city centre project. Yr Egin: the building is up, creative industries are again creating jobs now in Yr Egin building because of the location of S4C out of there and the media industries that went with that and have clustered in Yr Egin. So, you are creating skilled jobs in the media sector.

But as our second project comes online in Swansea, where we've got the growth hub, the innovation hub, again, that's built around fixing a specific problem that says, 'We've got some great entrepreneurs in the city and in the region at the moment. They have good ideas, they're growing their companies, but when their companies get to a certain scale, there's nowhere for them to grow further in the city or in the region, then we're losing them to other areas across the border, outside of Wales. Well, we've put the investment in, we've helped them to grow, but then when they get to a certain size when they could start to pay back, they have to move out of the region or out of the country. That can't be right.' So, it's about making sure that we provide the space for them to expand and the support for them to expand, as well as the people coming out of our schools, our colleges and universities to take up those jobs.

So, it's all of those things coming together. The true impact won't be seen, obviously, until we deliver all of the 11 projects, plus, hopefully, some more. We will have then diversified our economy into new areas, shored up jobs that would have been lost otherwise to our economy, because that's always a risk, and then again grown the areas of skilled labour that we are seeking to improve in. 

Thank you. You've imparted a lot of information to us today. Is there anything else you think you should say that's not been drawn out in questions? Now's the opportunity to say so.

No, other than to thank you very much again for the opportunity, and I guess just to reiterate the final point that I made, which was that the deal can't just be about the 11 projects. Really, I would like your support in pressuring both Governments to provide additional resources and additional projects for us to manage economically as a region, because, again, things like the metro, a regional transport system, they fit within the model that we've created and will have a better chance of success if they're delivered regionally through things like the city deal or the joint committee.


Indeed, that's what we'll be discussing now in our private meeting, because the result of these sessions will mean that, as a committee, we'll be writing to both Governments with our recommendations. Thank you, both, for your time this morning. I appreciate you both being with us, so diolch yn fawr, thank you very much.

Daeth y cyfarfod i ben am 11:40.

The meeting ended at 11:40.