Ken Skates AM, Minister for Economy and Transport
The Economic Contract, Calls to Action and Economy Futures Fund – known collectively as our new operating model for direct business support, is a core and essential element of our approach to economic development as set out in the Economic Action Plan.
I want to update members on progress made following the first financial year of its operation. Since the launch of the new operating model on 21 May 2018, I am pleased to report that we have:
- Completed over 150 Economic Contracts with individual businesses.
- Approved 96 investment projects through the Calls to Action and the Economy Futures Fund worth over £41million.
Together, the new operating model is ensuring the businesses we work with share our values and are investing for the future. It is particularly pleasing that there is a good spread of different types and sizes of business and importantly, the geographic spread has been positive too – with all regions well represented. We will continue to monitor this, because it is essential to our regional approach that we are serving all parts of Wales.
The early signs are positive. Through the Economic Contract, businesses are demonstrating their commitment to the principles of responsible growth, fair work, health, decarbonisation and skills and learning. This is about engagement, incentive and spreading good practice – a reciprocal ‘something for something’ approach that encourages businesses and Government to explore and test how a business contributes to the wealth and wellbeing of its employees and wider community. The true value of the Economic Contract is the framework that it provides for that dynamic conversation to take place.
The five ‘mission based’ Calls to Action have also proved to be attractive to business – despite the impact of continued Brexit uncertainty on the climate for investment. Businesses have responded positively, recognising that the Calls to Action encapsulate the types of activity that forward thinking businesses need to invest in if they are to sustain, compete, and grow into the future. The Economy Futures Fund is successfully responding to a call from business and others for greater simplicity, achieved by consolidating a number of funds under the Economy Futures Fund banner.
We have always been clear, that our approach would be proportionate and flexible and that we would learn through the process of implementation. To that end, we have engaged with the social partners and others as part of a wider stocktake that is helping us understand what is working well, where there is room for improvement and any lessons that we can learn. This exercise has provided us with some rich feedback that we are beginning to put into practice. We expect to conclude the stocktake later this year and I will be happy to provide members with a summary report at that stage.
Our challenge now is to continue to embed, evolve, and expand the new operating model and the Economic Contract in particular. To that end, we have already taken steps to embed the Economic Contract within the remit letters of some sponsored bodies and are piloting its application to infrastructure projects. We are also piloting use of the Economic Contract on the recently launched Development Bank of Wales Tourism Fund, with a view to further rollout to wider Development Bank activity. We will draw on lessons learned before a wider rollout to these new settings.
Our discussions with business and other stakeholders have shown a real interest in how the principles of the Economic Contract might evolve in future. In particular, stakeholders are keen to understand how any outputs of the Fair Work Commission will be taken into account and whether there is opportunity to widen the focus on decarbonisation to a broader environmental consideration that considers biodiversity and waste. We will be engaging stakeholders on further changes in these areas.
Finally, working with the Ministerial Advisory Board, I am keen that we work on business to business messaging that will help champion the Economic Contract and create a sense of a ‘movement’ and a contagious effect amongst businesses that want to become part of it.
I will continue to keep Assembly Members updated on progress.