One of the key changes set out in the plan is that in return for financial support there will be an expectation that businesses will enter into an economic contract with Welsh Government to assist with delivering the wider objectives of the economic strategy in Wales.
The economic contract will require businesses seeking financial support to demonstrate all of the following as a minimum requirement to be considered for support
- Growth potential measured by for example contribution to employment, productivity and supply chain effects
- Fair Work
- Promotion of health, well being and skills and learning in the workplace
- Progress in reducing carbon footprint
In addition businesses seeking financial support will also be expected to contribute to at least one of five calls to action which are:
- Innovation, Entrepreneurship and Headquarters
- Export and Trade
- High Quality Employment, Skills Development and Fair Work
- R&D, Automation and Digitalisation
A new Economy Futures Fund will be established in order to streamline and simplify financial support for businesses which will be aligned to the economic contract and calls to action. The fund will use a range of tools including grants and repayable forms of funding to support businesses in Wales which will include both indigenous businesses and inward investors.
Welsh Government support is currently focussed on 9 priority sectors however the new economic action plan sets out 3 over-arching National Thematic Sectors namely
- Tradeable services – examples of which include fintech and online financial services
- High value manufacturing – examples of which include compound semi conductors and new composite manufacturing
- Enablers – examples of which include digital, energy efficiency and renewables
Businesses in these new sectors will only be eligible for financial support if they satisfy the conditions of the economic contract and at least one of the calls to action although if not they could still be eligible for general business support.
In addition to the national thematic sectors the economic action plan also identifies a further 4 Foundation Sectors which the Welsh Government is looking to provide support for which are
Whilst the tourism and food sectors have been well supported in the past, support for the retail and care sector represents a new departure and a shift in approach from the Welsh Government.
The economic action plan also sets out a new focus on Regional Economic Development in order to help to achieve the overall objective of prosperity for all in Wales. The plan identifies 3 regions North Wales, Mid and South West Wales and South East Wales each of which will have responsibility for their own economic development to try to ensure that all of the regions in Wales benefit from economic growth.
The new plan is due to be implemented from 1 April 2018.
If you need any further information please contact Mike Fenwick