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Written Statement - Economic Stimulus Package

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Jane Hutt, Minister for Finance and Leader of the House

We were recently notified of a consequential relating to the UK Government’s decision to freeze council tax in England next year.  This totalled some £38.9m.  The First Minister informed the Assembly on 12 October that we intended to use this money to provide a short term economic stimulus.

Since then, we have worked closely with business, Trades Unions and other stakeholders to determine how we can best use this money, and considered a range of proposals from across the Welsh Government. 

I am today announcing how we intend to use the £38.9m over a two year period, to promote our objectives set out in the Programme for Government.  Taken together, these proposals represent a comprehensive stimulus package which supports the skills and apprenticeship agenda and have formed part of the Budget agreement with the Welsh Liberal Democrats. 

On the 16 November, the Minister for Business, Enterprise, Technology and Science announced £55m of new investment in Welsh SMEs this year to support business growth.  Last week, I announced an additional £87m of capital investment over the next two years across Wales.  This package builds on those actions to boost the economy and develop public services, generating immediate benefits for our economy while complementing our long term aims.

The package comprises:

  • Young Recruits Programme – this is an extension of the existing scheme to provide financial support to eligible employers who can offer a high quality apprenticeship programme.  We have allocated £0.65m in 2011-12 and £4.23m in 2012-13. This will fund an additional 800 apprenticeships in 2011-12 and a further 1000 apprenticeships in 2012-13.
  • Skills Growth Wales – this programme builds on the success of ProAct, providing support to companies that plan to expand their workforce and require financial assistance to make this possible. It complements Jobs Growth Wales.  We have allocated an additional £3m for 2012-13 which will help assist 1,200 people.
  • Capital Investment in Schools – this provides support to local authority and Further Education Institutions’ capital maintenance programmes, pending long-term capital investment via the 21st Century Schools Programme.  We have allocated an additional £9.26m in 2011-12 and this investment will be pan Wales.
  • Ely Mill Housing Project – the Welsh Government will invest £5m in 2011-12 and a further £1m in 2012-13 to assist the remediation work on the 50 acre site required to allow a broad partnership to deliver a mix of affordable and market housing over the next four to five years. The project will create up to 200 jobs per annum, starting in the second half of 2012.
  • Arbed – additional investment of £3m will expand the projects offered through the Community Energy Saving Programme in 2011-12.  This will deliver whole-house, area-based improvements in the energy performance of homes in the most deprived communities throughout Wales.
  • Social Housing – this project will deliver an additional 130 affordable homes pan-Wales.  It will lever in private finance, and we have allocated £9.26m in 2011-12.
  • Enterprise Zones - £3.5m investment in 2011-12 will support road enhancements required to secure the right platform for growth in the private sector.  It will deliver construction jobs for the specific project as well as facilitating further jobs through the Enterprise Zone once it becomes operational.