7th Economic Summit - Update

Welsh Assembly Government

Update Paper for the

Seventh Economic Summit 17 July 2009



wales.gov.uk 1

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© Crown copyright 2009

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Major Developments since the last Summit In response to the current global economic downturn the Welsh Assembly Government continues to take practical action to support individuals and businesses throughout this difficult period.

Energy Efficiency Capturing the potential: a Green Jobs Strategy for Wales • The Green Jobs Strategy was approved by Cabinet and launched on 9th July 2009. Under the ‘One Wales’ agreement, the Welsh Assembly Government is committed to the development of an all-Wales Green Jobs Strategy (GJS) to ensure that businesses remain competitive and sustainable in a low carbon, low waste economy, and that Wales benefits from the new business opportunities that will arise. • The document is available on the Welsh Assembly Government’s website via the Business & Economy section of: http://wales.gov.uk/about/strategy/publications/?lang=en • The Strategy’s overall aim is to contribute to a more resilient and sustainable economy for Wales by: -- enabling businesses to remain competitive in a world increasingly constrained by carbon, and where sustainability becomes a key business issue; -- supporting innovation and development of the new products and services that a low carbon economy will demand, and maximise Wales’ share of the commercial opportunities that will arise; -- enabling businesses to play their part in stabilising and reducing the ecological footprint of Wales. • The consultation process received 61 responses which have been taken into account in drafting the strategy. A Reference Group comprising officials representing DE&T, DESH, DCELLS, Value Wales, Environment Agency Wales have also been involved in the drafting of the strategy. The document has taken into account the 61 responses received during the consultation period. On the 9th July a new £25 million investment was announced to generate jobs and leisure opportunities based on the outstanding wildlife and landscape of North and West Wales. The monies will be made available through two flag ship schemes - Communities and Nature (CAN) and the Wales Coastal Path. £5 million of new funding was committed on the 10th of July to help businesses and the public sector to become more energy efficient and tackle climate change. The money will support initiatives to promote energy efficiency and low carbon technology in businesses and the public sector

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UK Government UK Innovation Investment Fund On the 29th June, the UK Government announced the creation of the UK Innovation Investment Fund to invest in technology-based businesses with high-growth potential. The new fund will focus on investing in growing small businesses, start-ups and spin-outs, in digital and life sciences, clean technology and advanced manufacturing. The UK Government will invest £150 million alongside private sector investment on a on equal basis. This could leverage enough private investment to build this into a fund of up to £1 billion over the next 10 years.

Business Support Business Advice Week Following the success of ‘Weathering the Storm’ events, the Welsh Assembly Government has arranged a ‘Business Advice’ week to take place between 13th and 17th July. This has attracted significant attention with over 400 enquiries received to book advice sessions in the regional centres across Wales during the week.

Increased Flexibility in FS4B In June, it was announced that there would be an extension of the Single Investment Fund to smaller companies and start-ups with potential to grow. This provides access to revenue support grants up to £10, 000 and capital grants from £5,000 - £10,000.

Funding Around £50 million of additional EU funding has been announced since the last Economic Summit, contributing to a total investment of £110 million to support businesses and help people into work and training in Wales.

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Capital Investment / Infrastructure Over £40 million of capital expenditure was announced at the beginning of July to provide an important economic stimulus to help people, communities and businesses in the face of the global recession, as well as taking forward the One Wales agenda. This additional £41.3 million of capital funding is the consequential uplift to the Assembly Government’s capital expenditure budget stemming from this year’s UK Government Budget announcement. The money specifically for 2009/10, will be distributed across Assembly Government portfolio areas as follows: • • • •

£1 million to the Department for Heritage for investment in culture. The Minister for Heritage will announce further details of this allocation later today. £12.2 million to the Department for Children, Education, Lifelong Learning and Skills. This extra investment will be focused on the FE sector in Wales. £8.6 million to the Department for Health and Social Services. £12 million to the Department for Environment, Sustainability and Housing. The investment will be targeted at additional measures to improve energy efficiency, and the acceleration of housing projects across Wales. • £7.5 million to the Department for Economy and Transport. Announcements will include investment in crucial road and rail services.

Skills New arrangements for the delivery of a fund set up to tackle economic inactivity have were announced in Wales on the 25th June 2009. The Deprived Area Fund (DAF) was set up by the Department for Work and Pensions (DWP) to reduce unemployment in the most disadvantaged areas of the UK. The fund in Wales is already being delivered by JobCentre Plus and the DWP’s City Strategy Pathfinders. For the next two years a portion will also be routed through two new partnerships - the Mon a Menai Partnership and South West Wales Spatial Plan Economic Inactivity Partnership. Together the new partnerships will receive £3.4 million of DAF grant from DWP to help people in their most deprived communities to obtain and retain employment. Two projects have been announced investing over £40 million to help economically inactive people back into the labour market and into learning will receive a £10.5 million boost. The funding boost will assist the Wales Council for Voluntary Action’s (WCVA) Engagement Gateway programme and North Wales Intermediate Labour Market (ILM) project which both focus on helping people into work through skills training and job placements. The funding boost consists of £4.5 million from the Welsh Assembly Government’s Targeted Match Fund, £4.2 million from the European Social Fund and £1.8 million from other organisations across Wales. This is in addition to the £43 million funding package given to the projects last year to support activities in the Convergence region of Wales.

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Housing A new plan to help people homeowners facing repossession was launched by the on the 24th June. In light of the current economic climate, the Mortgage Rescue Action Plan has been produced with a number of partners including Local Authorities, Housing Associations and the Council of Mortgage Lenders to provide support to struggling families and to make sure they know what help that is available.

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New Announcements Business Support FS4B Bank - Ready workshops A first round of 20 in depth workshops to businesses seeking development finance from the private and public sector is being developed as a follow up to the Ten Step Guide. These workshops are intended to provide friendly and informative session for key businesses, offering specialist advice to SMEs across Wales in relation to obtaining Bank finance.

Support for Business Planning Flexible Support for Business is being targeted to support businesses in presenting suitable business plans. Businesses can approach the Assembly Government for such support via our call centre or through our network of Relationship Managers based in our regional offices. Also, arrangements are in hand with the banks for them to refer customers for support, and I welcome the cooperation of the business support organisations in Wales in promoting this service to their members.

Assistance to Access Bank Finance The Welsh Assembly Government has been working with ACCA (Association of Chartered and Certified Accountants) and ICAEW (Institute of Chartered Accountants in England and Wales) and can announce that a rate has been agreed with them for work by accountancy professionals that helps businesses access the Enterprise Finance Guarantee (EFG), managed through the banks. The support will assist businesses requiring professional help to sharpen a business plan or develop a financial diagnosis. The mechanism to undertake this will utilise the Welsh Assembly Government’s Single Investment Fund (SIF). This support will be encouraged through pan - Wales seminars with the Accountancy profession agreed for early October (2nd of October in South Wales and on the 6th of October for North Wales).

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Skills Earlier this year the Chancellor of the Exchequer announced the Young Person’s Guarantee for young people aged 18-24 who are unemployed and claiming Jobseekers Allowance. Further to this the Welsh Assembly Government yesterday announced a funding package of £3.834 million to deliver the Young Person’s Guarantee in Wales. The funding allocation 2009/10 will be used for the following: • to deliver a full-time training option that is tailored to the needs of young people; • to provide training support for the Future Jobs Fund - a DWP scheme to create 6-month jobs in the public or voluntary sectors; • to provide training support for the Sector Pathways element of the Guarantee. These pathways will be designed to help young people to enter permanent employment in sectors where there are currently vacancies. We believe that the Youth Guarantee will be a very useful initiative to help young people into work. We will work closely with the Department of Work and Pensions in delivering the Guarantee in Wales. The funding will provide training in order to ensure young people have the full range of skills they need to enter permanent employment.

Supporting Young People and Parents through the Recession The Assembly Government are today launching a new campaign to support young people through the recession aimed at motivating them to continue to invest in skills or to take positive action to develop skills. The campaign is aimed at young people between 16 and 18 and promotes the message that ‘education and learning works’. A direct mail campaign will be undertaken during August to coincide with exam results. We are also pleased to launch ‘Your Family Friend’. This has been produced to inform parents of the type of support available to them and their children. This will range from free school meals to information on school councils.

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ANNEXES Classification Code Key: Each action has been classified in one of three ways: 1. R: RECESSION This is in direct response to the Recession 2. F: FUTURE Which is aimed at improving the future competitiveness of individuals and businesses to take best advantage of the upturn. 3. R/F: Which is a combination of both (e.g ProAct). 9

Skills Previous Announcements

Progress since last Summit

R: New Support for Jobseekers and for Skills

Announced 6th April - a new triple stimulus package of at least £20 million help for people to gain new skills, subject to ESF application. It provides an unprecedented training support package for the unemployed.

R: Assistance for Jobseekers

• The Department for Work and Pensions introduced the ‘Golden Hello’ of £1,000 recruitment grant for employers, which will be delivered by JobCentre Plus in Wales. • Welsh Assembly Government to provide 3,500 Jobseekers (those out of work for at least six months) with tailored training to provide the skills needed to do a specific job.

RF: Skillbuild

• The established Skillbuild programme is to be extended to meet growing demand in face of rising unemployment. Up to 4,000 additional people will receive help in 2009.

RF: A Boost for Education and Skills

• Extra support is to be made available to better equip an additional 2,500 young persons and adults with in-work skills and further education.

R: Careers Wales

• Careers Wales’ capacity is to be strengthened by 30 additional Advisers at an estimated additional expenditure of £2 million, from reprioritisation in the DCELLS portfolio and subject to ESF support. An additional 17,500 should benefit.

• ‘Golden Hello’ training is now available through Skillbuild.

• This programme provides training for those who are not in work, including young people leaving schools and college, and adults. About 5,000 adults received such training last year and additional funding has been put in place for an additional 4,000 places during 2009-10. It is delivered through contracted work-based learning providers. • FE Colleges and Local Education Authorities have been advised of the additional resource available from September 2009.

• Careers Wales companies will afford the recruitment process their highest priority.

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Skills Previous Announcements

RF: Local Employment Partnerships in the Public Sector

• The Assembly Government is committed to promoting Local Employment Partnerships (LEPs) across the public sector in Wales and to promote participation the Assembly Government and JobCentre Plus are jointly organising a stakeholder event in June.

RF: Special 2009 ‘Now is the Time’ Award

• A new National Training Award ‘Now is the time’ Award has been introduced to recognise those companies and voluntary organisations that have invested in training in direct response to this recession. • visit www.nationaltrainingawards.com/nowisthetime

RF: ProAct

• ProAct scheme started 2 January - to receive £48 million, including £38 million from European Social Fund (“ESF”) to cover 2009/10 and current pilot phase. This will assist approx. 12,000 workers.

Progress since last Summit • £1 million of the Skillbuild budget has been set aside for all LEP’s developments in Wales. The first private sector LEP with JobCentre Plus is currently being delivered for John Lewis Partnership. • 8,025 people assisted by LEP’s to year end March; 26% above target. • Joint Assembly Government/JCP event on 16th July at Liberty Stadium will promote LEP to Wales’ public sector. • Assembly Government aims to fill 20% of new vacancies through LEP’s and is encouraging other Public Sector organisations to do the same. • Active promotion of the award continues.

• 43 companies have already received offers of ProAct support, helping over 2500 workers to the value of £5.6 million. • 157 applications to the ProAct scheme have been received by 20 May all of which have gone through a ProAct panel. • 12 applications have been rejected by the ProAct panels to date. An additional 33 have queries which need to be resolved before the application could be progressed. • Once the training plan and associated documents have been completed appropriately the average number of days they wait for a decision is one day. • The time an applicant waits for a decision on the funding they will receive depends completely on the training plan and associated documents being submitted appropriately. The longest period an applicant has waited from completed application was 9 days.

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Skills Previous Announcements

RF: Apprenticeship Programmes

• £20 million to be made available to support Apprenticeships during the economic downturn subject to support from ESF, for the creation of a package of measures to help sustain and encourage new apprenticeship recruitment.

RF: ReAct

• Announcement made on 15th October 2008 to fund ReAct for a further five years and also to bring forward funding from future years. React will assist 12,000 workers. • The capacity of the ReAct programme will be increased by 50% for 2009/10.

Progress since last Summit • Young Recruits Programme will provide wage subsidy for 1,500 apprentices starting their training in August 2009 • Pathways to Apprenticeships will provide centre based learning for 1,500 young people who want to be an apprentice but no places are immediately available. To be targeted on key economic growth sectors. Since the launch of the current ReAct Programme on 1 October 2008 the following has been achieved: • £8,537,453.00 of grant funding has been committed and £3,152,519.00 has been paid. • 4,463 redundant workers have accessed ReAct support. • 466 employers have accessed the ReAct wage subsidy to employ a redundant worker.

F: Workforce Development Programme

• 1726 businesses accessed discretionary training support in 2008-09.

F: Support for Leaders and Managers

• 12,390 delegates attended Leadership and Management course in 2008-09. • New Centre for Excellence in Leadership and Management in Wales commenced.

• Workforce Development Programme intervention rate for SMEs has been raised from 50% to 75%, backdated to 1 October 2008, (increasing the training help that companies can receive).

• Existing contracts have been extended to the end of March 2010. Providers informed of additional budget and have submitted proposals, contract variations drafted. Proposed to expand the Workshops to deliver 2300 delegate places over and above existing delivery (an expansion of approximately 25% within the year). 66 placements and 77 work tasters already started. The 8 week campaign started on 2 March due to finish at the end of April.

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Skills Previous Announcements

RF: Basic Skills Employers Pledge We will double the target for employers signing the Basic Skills Employer Pledge, by March 2010 from 500 to 1000 employers. As part of the expansion of the Pledge we propose an additional 200 employers to apply for and receive grants up to 2010 (making a total of 300) with 10,000 employees in total taking part in basic skills courses. We will broaden the scope of the current Employer Pledge grant programme to include: • staff release costs for basic skills training (max per day cost allocated) • support provider costs to carry out basic skills mapping to job roles and plan-training programme, then deliver, • basic skills training needed for employees as first step before vocational qualification course or statutory assessment or extra basic skills support during first vocational qualification; and • basic skills identified as needed by individuals in company performancemanagement process.

RF: Go Wales

• Expanded Go Wales scheme to support graduate employment. Go Wales Graduate Academy pilot to be launched in early July.

Progress since last Summit • 52 additional employers have signed the Basic Skills Employment Pledge since the end of September 2008. 23% of the Welsh workforce is now employed in Employer Pledge companies (compared with 20% at the end of September). All of the newly-joined companies have had advice and support on literacy, language, numeracy needs, their action plan and their grant application. A total of 97 companies applied for Basic Skills Employer Pledge grants in 2008-09, an increase of 40% on the preceding year. Approximately £375,000 in grant funding was requested for the year ending March 2009.

• 446 participants Jan - June 2009. • GO Wales has organised 201 placements to work with SME’s across Wales so far this year. • GO Wales has received over 23,000 unique visitors to the website in the second quarter, with over half being new to the site. Many work placements are subsidised which means businesses can take advantage of the skills on offer at a reduced rate. GO Wales has just launched a Graduate Academy designed to equip new graduates with key employability skills and the pilot phase will begin on Mon 6 July. • Recent surveys of graduate employers confirm a growing demand for highly skilled employees and increasing competition for jobs. Graduates that take part in the 6 week Academy will develop a range of work related skills and will gain a nationally recognised qualification in leadership and management.

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Skills Previous Announcements

Progress since last Summit

R: Your Future, Your Choice, Your Action

• Campaign continues • A new campaign will commence in mid July to encourage school and college leavers to stay in education and training.

• A new campaign to make individuals, businesses and intermediaries aware of the support available to them from Welsh Assembly and UK Governments. •

R: DWP Deprived Area Fund (“DAF”) - Commences 6 April 2009.

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R: Wales TUC Cymru Rapid Response to Redundancy & Welsh Assembly

• Existing City Strategy Partnership in Heads of the Valleys will continue to be funded. Further funds allocated to enlarged Rhyl and Colwyn Bay Strategic Regeneration Area. £2.5 million approx allocated to new partnerships in Swansea and Western Valleys and Mon a Menai. • The WTUC have assigned five development officers to the rapid response initiative to work with workplaces which are threatened with redundancy or closure. • Over 30 companies are benefitting from support help and guidance, they include Anglesey Aluminium, BT,Novelis,Harman Becker, Brains and Tarmac. • Over 600 Wales TUC Redundancy -Finding the Right Support Toolkits have been distributed throughout Wales. This contains information on all types of available support. • A range of seminars and workshops to help union members cope with the economic downturn are being run by Wales TUC. • Developments are underway with FE colleges and Unions to develop community based advice days for those facing redundancy.

Government are up-skilling Trade Union officials by strengthening the capacity of Union Learning Representatives.

Expanded service now available in Wales. • Future Jobs Fund, run by DWP, aims to create 150,000 temporary jobs in Great Britain until 2011. Fund contributes up to £6,500 per job to pay wages • Assembly Government working with DWP, Jobcentre Plus, Wales TUC, WCVA and WLGA to maximise benefit for Wales. • Dedicated team established. • Support for training will be provided by Assembly Government using new financial allocation of £3.8 million in 2009-10. • Decisions on first round of bids from Wales should be known by mid-July.

R: On 12/11/08 DWP announced a doubling of funding for the Jobcentre Plus Rapid Response Service which is available throughout Wales. •

R: Youth Guarantee announced by Chancellor of Exchequer in April.

Measures to assist 18-24 year olds out of work for 12 months; -- a full time training option -- sectoral pathways to secure employment in sectors where vacancies exist e.g. care -- Community Task Force -- the Future Jobs Fund 14

Business Support Previous Announcements

Progress since last Summit

RF: A Guide to Accessing Bank Finance

Since publication of the Guide we have begun to work more closely with the Banks at a range of levels. For example, the Welsh Assembly Government Relationship Managers are now in ongoing dialogue with their counterpart Bank Relationship Managers at a local level across Wales. This dialogue is a positive exchange of information and perspective on businesses in their locality so that the common needs of their customers can be better understood and served.

In conjunction with the banks the Welsh Assembly Government has produced “A Guide to Accessing Bank Finance”. This booklet aimed primarily at SMEs, existing business and starts ups, is a guide to optimising their chances of success in applying for bank funding. The booklet also gives a summary of the criteria banks apply in considering funding applications and is an initial demonstration of cooperative working with the Banks.

Bank ready sessions will be introduced in the Autumn for businesses to attend based on the guide produced.

F: Business Innovation Support project The project has provided technical advice and information to over 500 businesses/individuals since its launch in February. As a result of advice and assistance from the Innovation Managers, 54 funding applications have been approved to assist clients with their R&D projects for things such as prototyping, product design and filing Intellectual Property (IP).

On 5th February 2009, a £35 million Business Innovation Support project was announced which will help thousands of Welsh businesses turn their innovative ideas into cutting edge products.

F: Manufacturing Support On 6th February 2009, the Welsh Assembly Government committed to working with and through the Manufacturing Forum in identifying manufacturing businesses to develop and implement high value-added business strategies, as the kind identified by SEMTA in its VAPP pilot project. The Welsh Assembly Government will also work with the Manufacturing Forum to explore the learning from the VAPP pilot project and to consider how it might shape future delivery approach.

Two events have been held at the start of July in North and South Wales, to provide information to businesses on how Business Innovation can help them. Both events were well attended with nearly 200 businesses across both venues where half of all attendees took the option to have a 15 minute one-to-one meeting with an advisers. The Forum has affirmed that the strategic direction that it proposed is still relevant to the future of the sector. The Chairman of the Forum met with the Deputy First Minister last month to discuss his views on the draft strategy. The Deputy First Minister agreed to work with the Forum to agree a strategy for the sector.

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Business Support Previous Announcements

Progress since last Summit

F: Enterprise Networks

Supplier Development Service - Emphasis on Public Sector Supply Chain developments, providing both sourcing advice (working with buyers and procurement officers within public sector organisations) and supplier development (including How to Tender Workshops, Meet the Buyer events and working alongside Relationship Managers and others to develop the capability of Welsh Suppliers). The contract to deliver this service has been let since the 1st of February 2009, and a team of contractors, delivering along DE&T’s operational areas, North, Mid, South West and South East, are now operational.

A new £25 million Enterprise Networks project to support the growth of Welsh businesses and create up to 1200 jobs was announced on the 29th January 2009. The project is supported by EU Convergence funding and is geared to help 4,200 businesses and 155 social enterprises over the next seven years. The project focuses on supporting supply chains in key sectors of industry and helping cluster of SMEs to bid collectively for public sector contracts.

Four ‘Meet the buyer’ events have been held, including an event in Llandudno Junction with the main contractor for the new Assembly Government building, Pochin, and two regional events raising awareness of the opportunities emanating from the Ryder Cup were held in January and February. A series of other events on both a local and regional level are currently in the pipeline. This activity is complemented by the Sell2Wales website, a site free to business, offering daily alerts of products / services that the public sector want to buy. Those notices are both within Wales, from the UK and across Europe. 22, 094 Welsh suppliers are registered on the site. Over 142 referrals have been made to date and the support has been welcomed in the market place. The service level of agreement on the additional funding to deliver the support will be agreed this month.

Additional support under Flexible Support for Business Start Up Service has been made available from April the 9th for individuals that have been unemployed over six months to start up in business including intensive 1 to 1 support.

Since November 2008, over 1,000 taster sessions and workshops have been held under the mainstream start up service across Wales to support individuals wishing to start up in business.

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Business Support Previous Announcements

Progress since last Summit

R: Weathering the Storm Seminars

Over 500 businesses across Wales attended the Weathering the Storm seminars. The feedback was very positive as businesses welcomed the opportunity to access a range of advice from different sources.

Regional seminars, entitled ‘Weathering the Storm’, are being set up to provide information and advice to businesses about managing through the current economic situation. The events, which are being arranged wef March 2009, will include specialist speakers, Q&A sessions and information on specific support. Information fairs will be run in tandem with these and there will be opportunities for 1:1 sessions with DE&T and DCELLS relationship managers.

Following the success of the Weathering the Storm events, the Welsh Assembly Government has arranged Business Advice Week to take place between 13 and 17 July. It has attracted significant attention with, to date, over 400 enquiries received to book advice sessions in the regional centres across Wales during the week.

RF: Flexible Support for Business (FS4B)

Ongoing. In June, it was announced that there would be an extension of the Single Investment Fund to smaller companies and start ups with the potential to grow. This will provide access to revenue support grants up to £10,000 and capital grants from £5,000 - £10,000.

We are continuing to keep under review the criteria for Flexible Support for Business (FS4B) to ensure they are appropriate to the current economic situation.

Approvals for SIF applications for advisory support under the Business Growth project are increasing. From January 09 - March 09, 81 offer letters have been sent out, to the value of £261,940 with a total investment value of £484,095. Since April the 1st, 2009 - 189 SIF ‘under £10k’ offers of support have been made with a value over £700,000.

R: Business Support Overview

The Wales Office has produced an updated online guide of business and training support available in Wales from the Welsh Assembly Government and the UK Government. It can found at: http://www.walesoffice.gov.uk/ supporting-the-welsh-economy/ A new, easily accessible pack of information, is being prepared for businesses which will be made available directly to customers as well as being shared with public sector partners and intermediaries such as accountants, banks and other organisations. It will also be available on the Assembly Government’s FS4B website. The pack, entitled, ‘Weathering the Storm’, will make clear the range of practical support and assistance available to help businesses through the current economic difficulties, so that they will be ready to take advantage of opportunities as the economy recovers.

There have been over 6,997 downloads of the Single Investment Fund leaflet, and over 5,439 of Welsh Assembly Government start-up leaflet since 1st January 2009. There have also been 5,641 downloads of the Weathering the Storm leaflets since early March. The FS4B Inclusion media campaign started on 30 March 2009 to encourage under represented groups to start their own businesses.

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Business Support Previous Announcements

Progress since last Summit

RF: Website and Supersite

The dedicated Leading Wales Out of Recession section on the Welsh Assembly Government website has a range of information leaflets available. Page Views from Feb 6 to July 12 were 26,679, with the average page views per day at 170. This information is accessed directly or via the BBC, FS4B or the UK ‘Realhelpnow’ sites and downloaded PDF versions of leaflets.

Work is on-going to link the Welsh Assembly Government Flexible Support for Business website to the UK Government Business Link site to provide business in Wales with access to, at on online location, relevant Business Link content alongside more specific Assembly Government business support information services.

Since January, the number of sessions on the business-support-wales.gov.uk site is 163,065. April saw the highest number of user sessions since its launch 12 months ago - 32,905. This has increased from visit numbers of 13,000 in November 2008 and 15,000 in December 2008. A team is in place and work is progressing on developing the new FS4B Supersite.

RF: Export Assist

£14 million Export Assist programme has been approved which will help business in Wales to win new export orders, supported with £6.5 million ERDF.

Advice and support was provided to more than 200 businesses during the first quarter of 2009/10 - 140 of which were supported via the Convergence Project. Companies assisted by IBW have reported new business totalling £19.7 million during the first quarter of 2009/10. Companies supported by the Convergence funded Export Assist Programme account for around 70% of this new business. During the same period, there were 10 overseas trade missions / exhibitions, including the largest ever mission from Wales which centred around Washington and was timed to coincide with the Smithsonian Folk-life Festival, where Wales was the featured nation.

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Funding Previous Announcements

Progress since last Summit

RF: Following the £45m Business Growth project (£13m ERDF)

Approvals for SIF applications for advisory support under the Business Growth project are increasing. From January 09 – March 09 saw 81 offer letters sent out, to the value of £261,940 with a total investment value of £484,095. Since April the 1st, 2009 - 189 SIF under £10k-offers of support have been made with a total value over £700,000.

announcement, grant funding up to 100% has been introduced to enable SMEs to get a broader range of support from the open market, to provide a more customer-focussed and flexible approach. This took effect from 13th January 2009. Business Growth will help sustain and grow 6,000 SMEs across Wales and create around 6,000 jobs.

RF: WEFO is currently developing a case for negotiation of intervention rates on the Structural Fund Programmes in the light of current pressures on co-financing and the decline in the value of Sterling against the Euro.

In the Plenary debate on the 9th of June it was announced that there would be an extension of the SIF to smaller companies and start ups with the potential to grow. This will provide access to revenue support grants up to £10,000 and capital grants from £5,000 - £10,000. WEFO is optimistic that a formal EC agreement will be reached before the summer on proposed changes to the 2007-2013 programmes, including intervention rates.

Following the All-Wales Programme Monitoring Committee’s agreement on 6th March of our proposals which include increasing the intervention rates for certain priorities of the 2007–2013 programmes, WEFO submitted a case to the Commission and is entering into formal negotiations with them. A Commission decision is expected by the summer. Previously announced EU funded projects are reported on in the relevant sections of this document.

Around £50 million of EU funding has been announced since the last Economic Summit, contributing to a total investment of £110 million to support businesses and help people into work and training in Wales. The 2007-2013 programmes also reached a major milestone with the launch of the 100th project on 1 July – the £8 million Swansea University ‘Lead’ project (backed with £5 million ESF), which will boost the management and leadership skills in businesses across the Convergence region.

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Funding Previous Announcements

Progress since last Summit Overall, £755m of EU funding (41% of the total EU funds available) has been committed to approved projects, driving a total investment of nearly £1.6 billion. Fifty per cent of this funding is helping individuals into work and training, 30% is helping businesses, and 20% is supporting investments in regeneration, transport and the environment. Other projects announced since the last Economic Summit include: • £27 million (ERDF £10m) South West Wales Property Development Fund, led by Carmarthenshire County Council, which will encourage private sector investment of £17m in commercial and industrial properties, creating jobs in the South West (announced 30 June); • £1 million (ERDF £0.5m) North East Wales Strategic Business Parks, led by Wrexham and Flintshire County Councils, which will develop business networks and supply chains, boosting the productivity and efficiency of the businesses in two of North East Wales’ important employment hubs (announced 26 June). • £10 million (ESF £4m) funding boost to extend the WCVA’s £43 million (ESF £24m) Gateway and Intermediate Labour Market (ILM) projects, already up and running in the Convergence region, across East Wales. Both projects will support more than 35,000 people across Wales into work through skills training and work placements (announced 22 June); • £18.5 million (ESF £9.5m) Peer Mentoring Programme that will help some 13,000 substance mis-users, via a peer mentoring programme, into work, training or education (announced 10 June). • £9m Coastal Access scheme (£4m ERDF) to complete the All Wales Coastal Path (Countryside Council for Wales) (to be announced 10 July); • £16m Communities and Nature (£7.5m ERDF) scheme which will fund innovative initiatives to improve the tourism potential of the environment (Countryside Council for Wales) (to be announced 10 July).

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Funding Previous Announcements

Progress since last Summit

RF: Wales is one of the few regions in the UK that maximised the

We are on track to achieve record levels of expenditure. Around 96% has already been spent on Objective 1, with project sponsors continuing to submit their final payment claims throughout 2009. This is already above the higher end level of expenditure for the 2000-2006 programmes anticipated by the European Commission across the EU. The final expenditure position will not be confirmed until late 2010 following submission of final audit claims by project sponsors and completion of the programme closure procedures.

opportunity to utilise the additional funding (around £52m for Objective 1) arising from exchange rate fluctuations. Wales is maximising its takeup of the new flexibilities announced under the European Recovery Plan including applying for a six month extension to the Objectives 1, 2 and 3 Programmes which will help achieve record levels of spend of £128 million in total project value.

Over their lifetime, the 2000-2006 programmes are expected to have created 46,000 net additional jobs, supported over 200,000 businesses, and helped some 96,000 unemployed or economically inactive people into work or training. The additional funds released through exchange rate fluctuations have enabled around 125 projects provide additional support for businesses and help more people into work and training.

R: The current Rescue and Restructuring Scheme ends in December 2009 and work has already started work on developing a further notification to the European Commission to extend this scheme beyond 2009.

R: On the 17th December 2008, and in response to the current economic situation, the European Commission adopted a Temporary Framework for State aid measures. The measures are designed to assist financing problems faced by companies during the economic crisis and to encourage their continued investment in a low carbon future. The measures are subject to notification and approval by the European Commission and will be effective until December 2010. We are in discussions with the Department for Business, Enterprise and Regulatory Reform (“BERR”) on the extent of UK-wide notifications with a view to maximising cover to support future interventions.

Work is continuing to maximise the legal cover available to the Welsh Assembly Government to provide assistance to companies in difficulty.

Four UK wide schemes have now been approved by the Commission under the Temporary framework as follows: • N43/2009 - small amounts of compatible aid (aid of up to €500,000). • N71/2009 - temporary aid in the form of subsidised loan guarantees. • N72/2009 - temporary aid for the production of green products through subsidised loans. • N257/2009 - temporary aid in the form of subsidised interest rates. These notifications provide the legal basis for providing support under the Temporary State aid Framework to companies facing financing problems during the economic crisis. The notifications do not provide for additional funding. N71/2009 and N72/2009 provide the legal basis for the UK package of support to the automotive industry.

21

Funding Previous Announcements

Progress since last Summit Specific criteria are currently being developed to ensure that any direct application of N43/2009 (small amounts of compatible aid) by the Assembly Government is targeted and prioritised. The practical application of support under the other notifications is also being considered.

RF: State Aid: UK Reference Rate The Reference Rate is used to calculate the equivalent of a “commercial rate of return” in loans and similar instruments in order to calculate the aid element relating to subsidised interest rates.

RF: Finance Wales continues to experience strong demand for

commercial investment. Anecdotal feedback from investee businesses and intermediaries supports the view that the high street banks are operating significantly reduced lending activities and with a more aggressive approach to pricing and security. Enquiries to Finance Wales have significantly increased and the company has invested nearly £17m so far this financial year, a 25% increase when compared with the figure for the corresponding period in 2007/2008 of £12.5m.

RF: The £150 million JEREMIE Fund for Wales – Finance Wales, the EIB and WEFO are working for the fund to be completed and operational as soon as possible and hopefully by the end of February 2009. In the meantime Finance Wales has existing funds under management and is open for business.

RF: The European Investment Bank (EIB) extensively revised its product offering for SMEs in 2008, developing a new lending formula called EIB loan for SMEs, which is designed to be simpler, more flexible and more transparent to benefit a greater number of small businesses.

With effect from 1 June 2009, the baseline UK Reference Rate was reduced to 2.20%, a reduction from the previous rate of 2.84%.

Enquiries to Finance Wales have significantly increased and the company has invested nearly £20m so far this financial year, a 20% increase when compared with the figure for the corresponding period in 2007/2008 of £15.9m. In the month of June 2009, Finance Wales invested £3m in 22 Welsh SMEs. A further £4.2m has been approved and is due to be drawn down by 19 Welsh SMEs. An additional £23.6m of deals are in the process of being evaluated before potential approval, involving a further 54 SMEs.

The £150 million JEREMIE Fund for Wales will help provide much-needed finance to some 800 businesses in Wales. In the three months since launch, Finance Wales has received over 250 enquiries and nearly 90 business plans.

In December 2008, the EIB signed three new generation EIB loans for SMEs in the UK for a total of £650 million, taking total EIB support for UK SMEs made available under the new scheme to £900 million. From this, around £475million of SME applications for funding have already been agreed by UK banks to date.

22

Funding Previous Announcements

Progress since last Summit

The SME loans are credit lines made available to national or regional intermediaries, which then lend on the finance as debt finance to SMEs that meet EIB criteria.

These deals were with three UK banks:

NatWest and RBS announced £3 billion extra funding for SMEs through new regional funds. This included a £250m fund dedicated to investing in SMEs in Wales, managed locally by Regional Managing Directors targeted to fully utilise these Funds in 2009. This new line of funding is partly financed from the £250m funding RBS recently secured from the EIB. The new fund dedicated to Wales will provide increased co-investment opportunities for SMEs with Finance Wales.

• Royal Bank of Scotland (RBS) is borrowing £250 million from the EIB directly to benefit smaller firms. • Barclays Bank has secured an EIB loan for £150 million. • Bank of Scotland (HBOS) secured an EIB loan for £250 million which will be dedicated to financing SME investments throughout the UK and Ireland. The EIB is discussing more loans for SMEs with a number of UK banks.

RF: UK Government initiatives:

Working Capital Scheme Bank loan portfolios qualifying for the guarantees have been identified. The first agreement, with RBS, was announced on the 31 March. Further agreements are expected.

• A £10bn Working Capital Scheme, securing up to £20bn of short term bank lending to companies with a turnover of up to £500m • An Enterprise Finance Guarantee Scheme, securing up to £1.3bn of additional bank loans to small firms with a turnover of up to £25m. • A £75m Capital for Enterprise Fund (£50m from Government augmented by £25m from the banks) to invest in small businesses which need equity.

Details of the Working Capital Scheme are one the FS4B website - http://www. business-support-wales.gov.uk/ credit_crunch/ real_help_with_finance_now.aspx).

On the 14th January 2009, the UK Government announced a package of measures, Real Help for Business, first contained in Chancellor’s Pre-Budget Report:

On 19th January 2009 UK Treasury announced 2nd bank intervention worth £350billion. The latest package includes a new insurance scheme to protect banks from so called “toxic assets” and gave green light for Bank of England to purchase up to £50billion of high quality corporate assets.

Enterprise Finance Guarantee Scheme The EFG loan is currently available through Barclays, Clydesdale/Yorkshire Bank, HBOS, HSBC, Lloyds TSB, RBS/Natwest and Northern Bank. On a UK wide basis, the scheme has over £573 million of eligible applications from over 5,000 firms that have been granted, are being processed or assessed. In Wales, over £15 million worth of eligible applications from 210 companies have been granted or are being processed. The type of lending previously provided under the Small Firms Loan Guarantee – to businesses that lack collateral and/or track record – is still available under the new scheme.

23

Funding Previous Announcements

Progress since last Summit Capital for Enterprise Fund Appointed fund managers have so far made offers totalling over £13m to nine businesses. Six businesses have accepted the terms of the funding offered with a total value of £7.9m. The fund managers are continuing due diligence on the further proposals that have been put forward HMRC – Time to Pay To date 6,340 businesses in Wales have deferred £86million of payments.

On the 27th January 2009 the UK Government announced a £2.3bn package of measures to help the UK Automotive Industry survive the current global economic situation.

Automotive Industry Package Approval of the scheme by the EU announced on 27th February, UK Business Minister gave clear indication that this funding was targeted at carbon emission reduction: open for applications from vehicle makers and suppliers with a turnover of at least £25million. The £2.3billion scheme has received applications from 18 vehicle makers and suppliers. Welsh businesses will be able to access support through collaborative projects working with their supply chains. Welsh businesses will be able to access support through collaborative projects working with their supply chains.

RF: On 20th May 2009, the Welsh Assembly Government launched

There has been an excellent response to the new Invest to Save fund with over 100 expressions of interest being made by public service organisations from across Wales. Appraisal work is now underway and funding decisions are expected to be announced in the Autumn.

RF: Scrutiny Development Fund – a fund which helps Councils create

The 2008/09 project is nearing its conclusion, with all projects having to be completed by the end of September.

a new £60m Invest to Save fund designed to support public service organisations in transforming the way they work – so that they can become more efficient and continue to deliver high-quality, citizen-centred public services.

better public services focused on the needs of local people has been given £10,000 to continue for a second year

The Scrutiny Event was held in Llandrindod Wells on 17th June. Local authorities who benefitted from the 2008/09 scheme were able to share their experiences through a series of presentations. The event was also used as a platform to encourage bids for the next round of funding in 2009/10. Bids need to be submitted by 31st July 2009. 24

Captial Investment / Infrastructure Previous Announcements Strategic Capital Investment Framework •

RF: This week (June 4th) the Assembly Government is initiating the

approach for developing the Second Tranche of projects to be taken forward under the Strategic Capital Investment Framework, for which we intend to make available £125m in 2010/11. •

RF: The approach for the Second Tranche is being strengthened to

enable earlier engagement with external partners on the development of potential projects, working in the context of the Spatial Plan. •

R: We announced our intention to bring forward capital budgets from 2010/11 into 2009/10

•

R: We have already brought forward capital budgets of around

£28 million from 2010/11 into 2008/09, which helped in particular to accelerate delivery of labour intensive projects in housing, education and the regeneration of the Heads of the Valleys. •

RF: Announcement 5th February - Construction Procurement:

measures to improve prospects for the Welsh Construction industry; including - working closely with the WLGA & other key partners, such as the construction sector to develop a common approach to the procurement of public works in Wales and bring significant benefits to procurers and suppliers.

Progress since last Summit • During 2009/10, we will be investing around £58m of SCIF funding on labour intensive capital projects across all parts of Wales. • The arrangements for developing the Second Tranche of SCIF projects were announced on 2nd June 2009 in a letter to Ministers and local authority leaders. Project proposals will be submitted to the Minister for Finance and Public Service Delivery for consideration by the Strategic Capital Investment Cabinet Committee which will put recommendations to Cabinet in the Autumn. • SCIF proposals will be considered against these criteria: -- direct links to the One Wales agenda -- evidence of cross cutting collaboration -- a strong fit with the Spatial Plan -- readiness to start, which includes planning consent where appropriate -- providing a stimulus to the economy by creating or safeguarding jobs during construction stage -- an invest to save approach where the initial capital investment leads to efficiency savings over the whole life of the project. • We are bringing forward £99 million of capital budgets from 2010/11 into 2009/10 and are investing it in labour intensive projects across Wales. • The capital investment is supporting projects in the areas of Health & Social Services (£29 million), Affordable Housing (£28 million), Education (£25 million) and the Economy, Transport and Regeneration (£17 million). • On 6 July 2009 details of the allocation of an additional £41.3 million of capital funding specifically for 2009/10 we announced. This amount is the consequential uplift to the Assembly Government’s capital expenditure budget stemming from this year’s UK Government Budget announcement. It will provide an important economic stimulus to help people, communities and businesses in the face of the global recession, as well as taking forward the One Wales agenda. All projects supported by the additional funding are ready for implementation and many will immediately encourage additional employment across Wales to support our efforts to combat the recession.

25

Captial Investment / Infrastructure Previous Announcements

Progress since last Summit

A Cabinet Written Statement was issued on 10th December 2008, making a commitment to streamline the planning application process.

• The business community, including FSB, as members of the Wales Planning Forum have responded to the call for evidence about what could be done to improve the process. Their views will be considered as part of a new research project – “Study to examine the planning application process in Wales”. The procurement process is underway and it is envisaged that the contract will be let in mid August. It will have an independent Chair of the research steering group and business community bodies such as CBI, FSB and Home Builders Federation have agreed to be members. • Lead Planning Members of local planning authorities were reminded on 21 May were reminded of the importance of processing planning applications efficiently and effectively. • Amending regulations should be in place by the end of the Summer relaxing planning controls on the installation of micro-generation equipment on domestic properties (except wall mounted wind turbines and air source heat pumps due to as yet unresolved noise and vibration issues similar to the position in England). A team has been set up in Planning Division to take forward the project to examine the planning application process in Wales, led by a senior WAG official. The aim is to examine the barriers to the efficient delivery of timely planning application decisions and to identify good practice in the processes undertaken to deliver planning decisions- in Wales and UK. The procurement process began in June for expressions of interest in tendering - 14 responses were made by 3 July and are currently being evaluated. If the process goes smoothly we should let the contract in Mid August. It is to run for 6 months and there will be dissemination events next year. The research will inform an action plan to take improvements forward. This project will also be informed by Independent Research Steering Group, chaired by Michael Sant and including business representatives such as CBI, FSB and HBF along with public and third sector interests. The group should begin a number of meetings with the appointed contractors around September/October.

26

Captial Investment / Infrastructure Previous Announcements

Progress since last Summit Independently, there are work streams underway in terms of improving the planning system, and e-planning is developing well. All 25 local planning authorities in Wales are now using the 1APP electronic system and we understand that about 40% of all planning applications are submitted online. The Welsh Assembly Government Planning Inspectorate has also developed an electronic system for people to submit electronic planning appeals. • In February the Assembly Government announced a temporary relaxation in the rules that govern the need for local authorities to make a minimum revenue provision to meet the cost of prudential borrowing to fund capital projects started and completed between the three financial years 2008-09 to 20102011. Authorities will still have to make full MPR over the lifetime of the assets created but the three year deferral will help in encouraging smaller capital schemes, such as refurbishment projects and help maintain local employment.

27

Housing Previous Announcements

RF: Home Buy

• The Homebuy Scheme consultation has ended and we are in the process of reviewing feedback. It is hoped that a new Homebuy Scheme can be re-launched in early 2009/10.

RF: Housing Bond

• A study has been commissioned to take up in more detail the idea of a housing bond to give RSLs more access to private capital which they can use to fund investment

Progress since last Summit • A revised Homebuy Scheme was launched in May 2009. Letters have gone out to local authorities and Housing Associations. A SCIF bid for further monies has been prepared, as currently there is no additional funding for Homebuy although local authorities can use their existing Social Housing Grant allocations to fund it. • The modelling work for the proposed Bond has been completed. The Report’s options were discussed at a Social Housing Finance Summit with lenders and Community Housing Cymru on 3 July. There was agreement that further work on the Bond should be undertaken and one option in particular should be pursued.

R: Intermediate rent product

• We now have the results of the modelling work and are finalising a proposed model which will shortly be considered. • The SCIF Tranche 2 bid from DESH includes funding for more than one pilot scheme in Wales IN 10/11.

R: Working with Lenders

• A review of the Mortgage Rescue scheme has been undertaken and revised guidance and criteria for the scheme are to be issued.

R: Working with the private sector

Housing Directorate is working with the Home Builders’ Federation to consider how stalled housing sites can be progressed. Sites have stalled for a number of reasons and each one has to be looked at on its own merits. Meetings are taking place with Housing officials, DE&T officials and the HBF. Funding has been requested through SCIF Tranche 2 for this area of work.

• Modelling and analysis to develop the financial matrix has been commissioned to develop the intermediate rent product which seeks to ensure that local authorities have the flexibility to create mixed income developments and communities in a market where home ownership is becoming increasingly less of an option.

• The Council of Mortgage Lenders are working with lenders to increase the understanding of the Welsh Mortgage Rescue Scheme, to ensure that the pre protocol agreements are followed which explore every feasible option to prevent repossession and homelessness.

• The Private sector in terms of house builders have been very involved in the SCIF schemes, and a number of workshops have been set up to discuss new ideas and how public and private partnerships could continue to support housing. • The Housing Directorate will be exploring these options as we move into 2009/10 options to take forward and develop partnership working between the private sector and the RSLs.

• Additional SCIF resources of £42m were made available to increase supply of affordable housing and make the most of opportunities to increase housing demand and take advantage of new properties and land, bringing with it added benefits of helping maintain employment in the building industry. 28

Housing Previous Announcements

Progress since last Summit • £42 million has been notionally allocated between local authorities using a formula based on total dwelling stock estimates. SCIF to the value of £15 million in 08/09 achieved over 200 additional housing units and assisted 25 private sector developers • We are working with local authorities and housing associations to bring forward further schemes in partnership with the private sector for the remaining SCIF resources for 2009/10 and 2010/11.

•

R: £12 million in Social Housing Grant (“SHG”) was brought forward into 2008/09. At the Economic Summit on 7 April it was announced that a further £28 million was being brought forward into 2009/10 from the 2010/11 budget for housing.

•

RF: Inform to involve (i2i) supports local authorities adopt social

clauses in public housing contracts by means of a “Can Do” toolkit. -- i2i held workshop events in January to improve client-side skills to use targeted recruitment and training as core requirements within contracts (with positive outcomes already being noted). -- All stock transfer associations are using the “Can Do” toolkit to include targeted recruitment and training within Welsh Housing Quality Standard (“WHQS”) contracts.

Discussions are ongoing with local authority and housing association partners on the priorities for the use of this funding. • The £28 million will be used to accelerate social housing programmes (land and units) to minimise the effects of the credit crunch on the construction sector, meeting housing need and working to meet the One Wales commitment of 6,500 affordable homes. Work includes: -- Increasing physical adaptations for vulnerable people which will also provide work-for small contractors -- Providing continuing support for the Mortgage Rescue Scheme. So far approvals have been given to help 123 families. i2i is currently in discussion with the Heads of the Valleys programme and Social Housing Grant team to identify ways to input targeted recruitment and training into conditions of grant. The ‘Can Do’ Toolkit has already created additional employment and training opportunities in the housing sector. Targeted recruitment and training is now being used as a core requirement of wider housing contracts to maximise employment opportunities e.g. Extra Care Schemes. Through the use of the ‘Can Do’ Toolkit, United Welsh Housing Association has created new-entrant training opportunities for 41 trainees, with 70% of these trainees gaining employment through these training programmes.

29

Housing Previous Announcements

Progress since last Summit Registered Social Landlords (“RSLs”) are also successfully using the ‘Can Do’ toolkit to secure training and jobs for local people when letting social housing contracts. Heads of the Valleys Programme is piloting the principles of the ‘Can Do’ Toolkit outside the housing sector; this includes Swansea City Centre Regeneration and possibly the dualling of the Heads of the Valleys Road (with the potential to create up to a maximum of 4000 additional short-term jobs between 2012-2020 Merthyr Valleys Homes, the new stock transfer in Merthyr, will offer up to 12.5% of the labour works to ‘new entrant trainees’ based on a 50/50 mix of 2 year and 1 year apprenticeships. They will hope to achieve 78 training and employment opportunities through its WHQS contracts. These numbers could rise to a maximum of 350 trainees if shorter courses were considered CIH Cymru has successfully delivered training courses to improve client-side skills to use these principles and clauses

•

RF: The Chartered Institute of Housing Cymru has introduced a range

of training programmes to help improve client-side skills in procurement.

•

R: The release of land for affordable housing has begun with an initial tranche of 8 sites with a total of circa 350 units. They are: -- Vaynor, Newtown -- Factory Road, Brynmawr -- Pirelli, Newport -- Llantarnam, Cwmbran -- Bro Castle, Bridgend -- Ely Farm, Cardiff -- Glasdir, Ruthin -- Aston Mead, Ewloe

Further sites are being explored by DE&T and DESH with a view to being brought forward in the near future.

Through Land Release Protocols we are able to make best use of Welsh Assembly Government land assets for affordable housing. Sites across Wales are being identified for disposal to Housing Associations to both address shortfalls in affordable housing supply and provide contracts for the development industry. A DE&T official has been seconded into the Housing Directorate to progress this area of work. A bid has been prepared for the Strategic Capital Investment Fund to obtain funding for Social Housing Grant on Welsh Assembly Government sites to enable affordable housing to be built. These will be mixed income schemes and not 100% social rented sites. Local authorities are working with the Assembly Government on the bids and Local authorities have been contacted where there are the Assembly Government sites located to ensure the sites meet housing need and are strategic priorities for the local authority area.

30

Housing Previous Announcements

Progress since last Summit

R: With effect from 5th January 2009 the Department for Work &

There is no further development on this issue from the Department of Work and Pensions.

Pensions has introduced a number of measures for new and some repeat working age claims: • The waiting period before full Support Mortgage Interest (“SMI”) on eligible loans paid in Income Support, income-based Jobseeker’s Allowance and income-related Employment and Support Allowance will be shortened from 30 or 26 weeks to 13 weeks; and changed from 50% SMI at eight weeks to 13 weeks at full SMI for vulnerable customers for new working age claims. • The capital limit up to which mortgage interest can be met will increase from £100k to £200k.

31

Energy Efficiency Previous Announcements •

RF: The Heads of the Valley (“HOV”) area will become Europe’s

first low carbon region, with low carbon technologies and large scale energy reduction measures never before undertaken in UK. This will in turn tackle fuel poverty, whilst creating a new industry base in the region. Less money spent on fuel bills also means more money available to be spent in the local economy. The programme is on target to invest £4 million, which includes the additional £2 million brought forward from DE&T budget, this financial year to help deliver the Low Carbon Zone principles. •

RF: A major part of delivery of the HOV programme has involved

a number of Micro-generation projects, utilising Registered Social Landlords (“RSLs”). To date there has been an overall investment by the programme of £3.245 million over three financial years to 09/10. Four partner organisations, RCT Homes, United Welsh Housing Association, Merthyr Tydfil Housing Association and Melin Homes are all working with the Assembly Government in the first phase to deliver the programme. •

RF: In addition, significant funding is also available from the Low

Carbon Building Programme phase 2. Combining funds outlined above will enable 40,000 homes in the region to secure sustainable energy measures, thereby mitigating fuel poverty. Work is currently underway to explore opportunities for making Micro-generation an affordable option for all householders in the region. This has resulted in applications for LCBP money totalling £4 million in the Region, whilst we are still awaiting the outcome of these applications, there is a potential to double the investment made to date. •

F: An European Parliament decision on the proposal to amend the regulation and allow for energy efficiency and renewable energy investment in the housing sector is pending. WEFO is drafting amendments to the Welsh Programmes to take advantage of these changes when agreed.

Progress since last Summit • The Low Carbon initiative has the potential to create real benefits for communities in the Heads of the Valleys. Less money spent on fuel bills means more money available to spend in the local economy. • £12 million has been made available from the Strategic Capital Investment Fund to advance the project. • The programme output profile is as follows: -- 2008/09 - £4 million -- 2009/10 - £4 million -- 2010/11 - £4 million • The overall Investment Outcomes of the 15 year programme will be -- 40,000 Micro generation units installed - or equivalent -- 65,000 homes assessed for energy efficiency measures -- 39,000 implemented energy reduction measures -- 2,000 jobs created (in installation and production) -- 1,500 people trained to recognised standard -- 50 new businesses created -- 2 international producers -- The largest concentration of Micro generation in EU -- Reduced domestic energy bills of at least £1.7m -- Reduced emissions of at least 139,200 tonnes CO² a year

Indicative Key Milestones and Dates

• Programme commenced - December 2008 Phase 1 - £4 million investment 2008/09 financial year -- Up to 1,000 units procured for installation -- £4 million applications for Low Carbon Building Programme (LCBP) submitted

32

Energy Efficiency Previous Announcements •

F: “The emphasis on Green jobs and developing the low carbon

economy is increasingly being recognised as a huge growth sector for the future, alongside healthcare, pharmaceuticals, precision engineering, advanced manufacturing, nuclear power, education, bioscience, digital infrastructure, electronics and other knowledge based sectors. It is estimated that Low Carbon industries could generate an additional 1m jobs UK wide if we do the groundwork right now through a combination of procurement policy, research investment and innovation and skills development.” Taken from speech by Secretary of State for Business, Enterprise and Regulatory Reform (“BERR”) at UK government Jobs Summit January 2009. •

R: An additional £2 million will be brought forward from within the DE&T budget for works on the Heads of the Valley (“HOV”) Low Carbon Economy programme in 2008/9.

Progress since last Summit Phase 2 - £8 million investment 2009/10/11 financial years -- A further 2,000 units installed -- Further applications to LCBP submitted by June 2009 -- Ongoing discussions with partners -- Continue WEFO engagement with a view to EOI submission Phase 3 - take the project to the next 3 year investment stage installations completed

Installations underway

Training places created

Total value of contracts

Additional funding brought into Wales

WAG Funding

406

1,111

60

£7,021,895

£3,021,895

£4,000,000

• We are working with these organisations to deliver maximum local benefits through the supply chain utilising the i2i toolkit. This work has benefited the following: • Supply chain focused in Wales. Solar Thermal manufactured in Carmarthen and installed by local SME. • Use of local contractors inc sub contractors (generally within 20 miles of the development site). • Some of the bigger contracts are being managed for the RSL through Centrica they are utilising local labour where possible and local supply chains. • Many of the photovoltaic panels are manufactured in Wrexham at Sharps

Bioenergy Action Plan A consultation on a Bioenergy Action Plan for Wales was held between February and May 2009. This identifies the Assembly Government’s aims regarding bioenergy as: To • optimise the benefits of bioenergy use to significantly reduce the emissions of greenhouse gases while maintaining a high carbon content of soil

33

Energy Efficiency Previous Announcements

Progress since last Summit • • • •

contribute to long-term fuel security; ensure that the public sector leads by example’; encourage the development of sustainable forestry and agriculture; and support business development and job creation in all parts of the biomass energy supply chain.

The Plan identifies actions for increasing the demand for bioenergy and for the supply of biomass from Welsh sources, and shows how it should be possible by 2020 to secure the annual generation in Wales of at least 5 terawatt-hours of electricity and 2.5 terawatt-hours of usable heat energy from renewable biomass. More than 50 responses to the Consultation were received and these are now being assessed prior to setting up a steering group to implement actions in the Plan. The responses will also help to formulate the Wales Energy Strategy later this year. •

RF: The European Commission has announced as part of the EU

recovery framework that investments in housing related energy efficiency will become eligible for funding under Structural Funds. Further information is anticipated on these proposals, but we will be actively investigating their potential use in Wales.

The EU Recovery Plan also provides scope for using the European Structural Funds to support energy efficiency and renewable energy schemes for low-income housing. WEFO is in discussion with the Commission, with a decision on the implementation of this flexibility expected in the near future. The European Parliament has adopted an amendment to the Structural Fund Regulations allowing expenditure on energy efficiency improvements and on the use of renewable energy in low income housing. It is anticipated that this amendment will come into force in the next few weeks. No new funding is available but WEFO will be amending its eligibility guidance and the Strategic Framework to reflect the change.

34

Procurement and Payments Previous Announcements •

R: From Jan 2009 the monthly payment of Revenue Support Grant by

Welsh Assembly Government has been brought forward by an average of 5 working days per month. This will assist local authorities to improve cash flow and increase their ability to make prompt payment of invoices. •

R: Welsh Assembly Government has started to monitor its

performance against its 10 day target for paying invoices. The policy is to pay all invoices on satisfactory receipt of goods or services.

•

F: Discussions are underway to align xchangewales training provision with the existing procurement training programme

•

F: An additional investment in the xchangewales programme will be

made available in this financial year to: -- Extend the sell2wales website in order that the successful prime contractors -that win large contracts will be able to advertise contract opportunities for their second and third tier suppliers. This will open up for the first time these major contracts to competition from SMEs;

Progress since last Summit • There has been a generally positive response to the Assembly Government’s encouragement to local government to take up the challenge of the 10 day target; for example, a group of South Wales local authorities will meet on 21 May, with support, to discuss among themselves how to speed up payments. • The WLGA conducted a survey of the current position in each local authority in the last quarter of last year and this will be followed up with quarterly enquiries on payment performance. • In the year to 31 March 2009, the Assembly Government paid 90.1% of its purchase invoices within the 10 day deadline, according to the data recorded across departments. • Local authorities were surveyed on their performance in the first quarter on their payment performance. 43% of payments are being made within 10 days and 85% within 30 days. This data will be updated quarterly. Alignment of xchangewales training provision with Value Wales Training & People Development programme will ensure consistency of procurement application across the Welsh public sector. Delivery of this training commenced in Jun 09. Increasing the use and availability of tendering tools, will result in an increase in the number of public sector organisations conducting procurement electronically, thus resulting in a more consistent and simplified tendering process for SMEs when competing for Welsh public sector contracts overall. • Sell2 Wales Tier 1 procurement portal now released into live environment. One private sector organisation (POCHINS) has already signed up and will publish opportunities as they arise. Costains are now registered and have published the first live notice, a work package for landscaping on the Church Village bypass scheme. This was created and published onto Sell2Wales on Friday 22/05/2009. • Following a preliminary meeting with Welsh Health Estates (WHE), further meetings are planned with WHE and three suppliers who form their supply chain in July. It is envisaged having WHE signed up to the main portal and the three suppliers to the Tier 1 portal by the end of July.

35

Procurement and Payments Previous Announcements •

RF: Make provision for additional training for the wider Welsh public

• The “Making it Happen” training course has so far been delivered to over 200 delegates across the public sector with more scheduled fro the remainder of 2009. The course focuses on the use of the Sustainable Risk Assessment template (SRA) which requires procurers to factor in economic, social and environmental benefits into their purchasing decisions. Welsh Assembly Government and increasingly the wider public sector is using the SRA to ensure that opportunities are available to Welsh companies to bid for public sector work. • In addition, a training course specifically looking at working with the Third Sector and Supported businesses is being delivered and sustainability is a key element of professional training delivered through the Value Wales Procurement training contract. Training for DE&T’s Supplier Development Service on public sector procurement is also being developed.

F: Deliver a Trading and ePayment pilot for One Voice Wales. This will

• Building on a number of presentations to Community and Town Councils, this trial project has continued this theme with recent appearances at Carmarthen, Anglesey and Wrexham CTCs. By invitation, on 7th July, the team will speak at a National Conference for the Society of Community Clerks. The cost and availability of Transaction Manager (software for an easy order portal) are subject to detailed discussion on 3rd July.

sector on the benefits of SME-friendly procurement; and social benefits;

•

assist - Community and Town Councils onto the first rungs of eTrading and ePurchase and strengthen the close links of the Councils [700+] to many SMEs.

•

Progress since last Summit

RF: Commissioning Value Wales to review how further acceleration

of sustainable procurement practices across the public service would bring forward added benefits - social, economic and environmental. This would include: • Further promoting the benefits of - xchangewales,

• xchangewales & DE&T Dates for a joint Supplier/Buyer Event have been diarised for 29th October in Swansea and 5th November in Llandudno. The event will provide an opportunity for both buyers and suppliers to network over lunch whilst attending seminars for each group respectively in the morning and afternoon. DE&T Supplier Champions will be in attendance to support the events.

36

Procurement and Payments Previous Announcements •

F: Next steps for MtC Improvement Fund - Mainstreaming procurement actions across all sectors.

Progress since last Summit • The ‘Barriers to Procurement Opportunity’ report has now been published and feedback is being received from public and private sector stakeholders. The Assembly Government’s Value Wales division is meeting and consulting with key stakeholders over the summer to develop an action plan to take the work forward. Further announcements will be made when this has been finalised. • The report includes recommendations on how processes can be made more efficient, and how barriers faced by SMEs can be reduced. • For more details on anything covered in this document please email: [email protected]

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Business Rates Previous Announcements •

R: In April 2009 the Assembly Government announced that it would

be implementing measures to help Welsh businesses with their rates bills. Under the current arrangements non-domestic rate bills for 200910 are set to increase by 5%. •

R: The changes we are proposing will reduce the rates bill in 2009-10

for potentially around 100,000 businesses in Wales by some £24 million overall. They come in addition to the £20 million in rate relief we are already giving to small businesses in Wales and the temporary increases in rates relief on empty properties in 2009-10. •

R: The additional costs to local government resulting from the changes will be met centrally. We will be discussing the issue of costs with Local Government.

•

R: On 28th November, two rate relief measures were announced to help small businesses across Wales during the downturn parallel with changes announced for England in the Pre-Budget Report.

•

R: Two temporary measures announced in respect of England by the

Chancellor of the Exchequer in the pre budget statement will apply in Wales. • For the financial year 2009-10, the threshold at which empty properties are liable to pay business rates will be raised from £2,200 to £15,000. The UK Government estimates that this will exempt around 70% of empty properties. • In addition, businesses will be allowed up to eight years to pay by interest free instalments certain backdated business rates bills that have been affected by recent rating reviews.

Progress since last Summit No change since last Summit

• 2009-10 NDR Increase Payment By Instalments The Assembly Government is making regulations to allow businesses to defer 60% of the 2009-2010 general 5% increase NDR bills by instalments over 2 years. This equates to around 3% of the total 2009-2010 NDR bill. • Rates relief for businesses with a rateable value up to £6,500 in Wales is generally applied automatically. In England and Scotland, rates relief generally requires an application, and a smaller proportion of potential eligible businesses are estimated to receive it. • Chancellor decided the best option for relief for business was the temporary empty property relief that will exempt all properties with a rateable value of below £15,000 will come into effect in Wales 1 April09. • Since last September there has been a very rapid reduction in the RPI and we propose to bring forward regulations under the 1988 Act that will allow Welsh businesses, if they wish, to pay an annual increase of only 2% in 2009-10 with the remaining 3% spread over the following 2 years, 2010-11 and 2011-12. We will be discussing the details of the revised arrangements with the Treasury; the Welsh Local Government Association and Welsh Business. We propose to have the regulations needed to implement these changes in place in July. • The Welsh Assembly Government has recently implemented in full the Assembly Government’s One Wales commitment to enhance rates relief for small businesses and £20 million is available to fund this. The proposal for a £10,000 exemption threshold would cost up to an additional £70 million which would have to be met by reducing Assembly Government resources for other priorities. • The Treasury has confirmed that the Assembly Government has to fund any reductions in business rates that the UK Government does not fund in England. Welsh Ministers have discussed business rates with the UK Government and agreed to fund relief for unoccupied properties with a rateable value up to £15,000 in 2009-2010, and to allow ratepayers to defer 60% of the general 2009-2010 business rates increase over the next two financial years.

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Business Rates Previous Announcements

Progress since last Summit • Since last September there has been a very rapid reduction in the RPI and we propose to bring forward regulations under the 1988 Act that will allow Welsh businesses, if they wish, to pay an annual increase of only 2% in 2009-10 with the remaining 3% spread over the following 2 years, 2010-11 and 2011-12. We will be discussing the details of the revised arrangements with the Treasury; the Welsh Local Government Association and Welsh Business. We propose to have the regulations needed to implement these changes in place in July.

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