4. What action is the Welsh Government taking to increase productivity in South Wales West? OQ59740

Our economic mission sets out clearly the values and priorities that shape the decisions we are taking in supporting our economy. For South Wales West in particular, a good example is the Swansea bay city deal, looking to deliver £1.2 billion of investment, with the aim of creating 9,000 jobs.

Thank you, Minister. Despite numerous strategies, plans and massive injections of cash in the form of Objective 1 funding, productivity per capita and GVA remain well below the UK average across my region. In fact, gross value added per hour worked in Bridgend and Neath Port Talbot has fallen from 87 per cent of the UK average to 85 per cent over the past two decades.

Now, in every economic index, Wales continues to lag at the bottom. Minister, you can't simply blame this on the mythical Tory austerity or the pandemic; productivity went up during the Cameron Government. You are in control of the Welsh economy, so when will you take responsibility and take charge and get to grips with the ailing economy of my region?

Well, of course, when it comes to productivity increasing here in Wales, from 2012 to 2021 productivity in GVA terms increased in Swansea and Neath Port Talbot by 21 per cent and nearly 18 per cent respectively. As I said earlier in response to Luke Fletcher, the confounder in UK economy terms is actually the over-performance and overheating of London and the south-east compared to the rest of the country.

We continue to invest in areas to improve the productivity of the economy more generally; we continue to invest in supporting the economy to grow. A good example is the work that we've had to do, pragmatically, with the UK Government alongside free ports, not because we see free ports as the answer to everything, but actually to accelerate the opportunities that will take place in our renewables sector, what that will mean potentially for advanced manufacturing, the opportunity to see a longer term future for Tata, and all of the other jobs we think could be created if we are able to properly maximise and take advantage of renewable energy along our coast. It's just one of the examples—I've given examples in many other areas in response to earlier questions from Luke Fletcher—where we are already growth taking place in some sectors here in Wales.

We could always do more with a stable partner in the UK Government who wants to work with us, not around us, that respects the devolution settlement rather than always trying to find a way directly through it. I'm optimistic we'll have that in less than a year or so's time, when the next election is called and we a see a Labour Prime Minister and Chancellor in Downing Street. 

I totally agree, Minister, with the need for real joined-up government with the UK Government; they need to be a willing partner to work with us to drive increases in productivity. But you've actually visited several of the companies in the region, including in my own Constituency of Ogmore—some of the leading, not just Wales-leading but UK-leading, high-productivity companies, including Sony Pencoed, where you were recently, looking at some of the companies there in the incubator unit as well.

Steve Dalton, the former chief executive of Sony Pencoed, said of previous Welsh Government support that the investment, including from the economy futures fund, would drive growth in multiple businesses at Pencoed, drive growth in the Raspberry Pi business and drive the development of Sony UK Technology's prototyping business, which brings new product designs to market for third parties as well. Just in the Bridgend area recently, I know that we've had 27 projects, 17 businesses, supported with SMARTCymru funding for innovation as well. Does he agree with me that productivity improvements are delivered by excellent private sector organisations in our area, but they need an active Welsh Government with targeted financial support to provide the foundation for their success?

Thank you, and I will acknowledge that, in terms of the investment you've spoken about with Sony, that was a decision made by the previous Minister, Ken Skates, and I'm delighted to acknowledge the choice he made, because it does exactly what you say: it's a private sector company that is investing in the future of its workforce alongside an active Government. When we visited, of course, we did see the significant increase that was taking place in Raspberry Pi production. We visited the incubator and saw different businesses that are growing there on that site. In fact, some of those businesses are now moving out because they've outgrown the incubator space. That's exactly what we want to do and it's exactly what this Government is aiming to do, and that's how we target the limited resources we have now to make sure they deliver maximum return. I'm delighted to see that there are real examples of that in the Ogmore Constituency and beyond.