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12 December 2017

FSB Wales response to Prosperity for All: Economic Action Plan

Responding to the publication of Prosperity for All: Economic Action Plan Janet Jones, FSB Wales Policy Chair, said:

“The publication of this document is an important moment for business in Wales.

“This plan is long awaited and overdue but there is much welcome thinking contained within it. It is now time to move towards outlining proper detail that translates this from ambition and vision to meaningful action for business and the economy.

“Ultimately, the Action Plan commits to recognising and working with the economic assets that we have in Wales and this is welcome. The pledge to focus on growing and promoting indigenous businesses is something that FSB Wales has long called for.

“We are pleased to see that, as with the UK Government’s Industrial Strategy, the document has identified some of the weaknesses of the Welsh economy, such as low productivity, and we hope to see these strategies complement each other to tackle these challenges.

Regions

“It is important that the Cabinet Secretary has recognised that at the moment the Welsh economy is regionally imbalanced; this is something that we must work together to redress.  For too long, interest and attention has been focused in particular areas of Wales to the exclusion of opportunities elsewhere in the country.

“Moving away from a ‘one-size-fits-all’ approach means that we can fully exploit the particular opportunities within each region including, but not limited to conversations on the Growth Deals. Allowing regions to identify their own priorities based on the needs of their businesses is the key here.

“As part of this, it is encouraging to see emphasis on the rural economy following much work by the FSB. However, the Cabinet Secretary could go further than this, and adopt a Rural Challenge Fund to support rural Wales, as recommended by the FSB in our Rural Taskforce report which would stimulate new thinking on developing the rural economy.

Foundational Economy

“We are very pleased to see an explicit ambition for the development of the foundational economy, which plays a critical role Wales. We will work closely with the Cabinet Secretary and his team to develop the plans for this area of the economy as we move this from theory to action.

Business Support

“The commitment to simplification and flexibility of support and interventions for business is promising and will bring tangible benefits to businesses who want a business support system that prioritises accessibility and ease of use. However, we need specific detail of what this simplification agenda will look like.

Economic Contract

“The approach to the economic contract is innovative. A contract is something that must be beneficial to both parties, and we very much hope this will be the spirit in which the contract is used. It therefore needs to be easy to comply with. As with any contract, there needs to be a clear understanding on both sides as to what constitutes a ‘breach’.

“The Action Plan identifies a number of ways in which we can ‘raise the ask’ of larger firms through the contract. For our part, we’d like to see a stronger emphasis on leveraging the impact of  Wales’ larger firms’ to help develop their Welsh supply chains and we feel that this needs to be specifically detailed as one of the ‘calls to action’.

Sectors

“We welcome the removal of a sector based approach, which was often confusing to SMEs who didn’t feel it was relevant to their business and at time looked like an arbitrary approach to support. Moving forward, there needs to be greater clarity on what is included in the thematic sectors, and more importantly, what is not included.

Wales and the World

“The document rightly recognises the need for Wales to project its brand more effectively to aid trade and investment. Welsh Government should commit to the development of a Trade and Investment Strategy to inform and guide this work and help create a vehicle for businesses prospecting abroad. However, we are pleased to see the Plan recognising the need to link with the UK Government’s own activity in this area.

What’s Missing

“While the Action Plan identifies a number of priorities going forward, we feel there are areas for further development.

“For instance, Welsh Government must also address some of our more strategic weaknesses such as how we address the lack of medium sized businesses, which was highlighted earlier this year by FSB Wales, or the lack of careers advice and support on offer in schools and the impact this has on the future of entrepreneurship.

“We also recently called for a wide ranging Welsh Government review of self-employment in order to properly understand it and its impact in Wales, and would repeat this call going forwards.

Next Steps

“In consulting with business during the next stage, we would expect to see clear indicators and targets to measure success. Businesses operating on the ground must be able to see what this strategy means for them in reality.

“Overall, this document strongly hints at the recalibration of thinking that FSB has been calling for and seems to be heading in a positive direction. However, Welsh Government needs now to intensify a meaningful consultation with business to make it more tangible. Welsh Government must create a partnership with business that helps this plan to succeed.”