MIKE HEDGES ASKS WELSH GOVERNMENT TO CONCENTRATE ON UP SKILLING WORK FORCE AND SUPPORT HIGH WAGE SECTORS OF THE ECONOMY.

MIKE HEDGES ASKS WELSH GOVERNMENT TO CONCENTRATE ON UP SKILLING WORK FORCE AND SUPPORT HIGH WAGE SECTORS OF THE ECONOMY.

Speaking after the Senedd Debate on the Westminster Governments Autumn Statement, Local Swansea East MS, Mike Hedges said… ‘ The best way for the Welsh Government to address the recession we face is to grow the economy and the best way to do that is to support increasing the skills of the work force and supporting sectors such as the universities and the industries which can grow when working in Partnership with Universities. European Cities have such as Aarhus have shown how partnership between Universities and Government can boost local economies to lead long term growth.

Investment in these and other high wage sectors are the way to grow our way to economic recovery’

Mike Hedges MS15:56:17

I welcome the Minister’s statement. I sum the Westminster Government’s autumn statement up as very disappointing, but not disastrous. After 12 years of Conservative Government in Westminster and a decade of austerity, the UK is in a deep recession and households are facing the biggest fall in living standards on record—’just managing’ have become the ‘just not managing’. The £1.2 billion over two years additional funding for the Welsh Government will not fill the big budget gaps. Does the Minister agree that the challenge for Welsh Government is to use the money wisely, concentrating on key outcomes, not on fiscal inputs? In a recession, the challenge is to grow the economy. That means greater concentration on high skills, high-wage sectors, and increasing skills, a move, I would suggest, to implementing indigenous growth theory. 215

Finally, on capital, has the Minister thought of using capital receipts? 216

Rebecca Evans MS15:57:12

Thank you very much for raising those particular points, and I absolutely agree that it is the case that we should be looking to use the money wisely, and to be thinking particularly about what the outcomes are in terms of the decisions that we make, which is why it’s important now to take this amount of time that we need to get under the figures that were provided to us after the statement on Thursday. And those come through in a series of spreadsheets and additional supporting documentation, so we need to really get under that to understand precisely what the consequential funding relates to. There are often very, very immediate requests for us to provide reassurances of certain levels of consequential funding as a result of those decisions on the part of the UK Government, but we are very firm that we do need to spend some time getting underneath those particular issues to understand.217

But also to understand the negative consequentials, because people are always very keen to talk about the positive consequentials, and to ask for their fair share of that, but they’re probably less keen to ask for their fair share of the negative consequentials. We already know that we will be required to be £70 million worse off next year and the year after as a result of the UK Government’s decision in respect of national insurance contributions for employers. So, again, that’s something that we have to factor into our particular ways of thinking as well. 218

On capital, we’ve been really keen to impress the UK Government on this issue, because I’ve talked today about how our capital budget is shrinking over the period of time ahead, which is obviously a real worry. But then, when you do look at what some of the experts are saying—the National Infrastructure Commission, the growth commission, the Organisation for Economic Co-operation and Development—all of them are saying that in a time when you want to grow the economy, you need to be investing. You need to be investing in human capital—so, investing in skills, as Mike Hedges says—and also investing in green infrastructure—so, investing in green energy, and so on—and having that particular focus that Mike Hedges talks about in terms of the high wage sectors, and the opportunities for us to grow in those areas, which will put us on the world stage and make us attractive to investors, whilst also nurturing our own talent that we have here in Wales. 219

So, absolutely, that’s the kind of space that we need to be in. The capital settlement does make it harder for us to operate in that space, but we are looking, as I say, at all the ways in which we can potentially maximise our capital. 220