Ken Skates, Assembly Member for Clwyd South and Minister for Transport, Economy and North Wales (pictured), has this afternoon delivered a statement in the Senedd on the coronavirus situation. llanblogger brings it to you in its entirety ...
There is no doubt that we are facing unprecedented pressures on our economy as a result of the Coronavirus outbreak.
There
will be many companies in Wales - small and large - dealing with the fallout of
this virus. From contract cancellations to increasing staff sickness
rates; from major supply chain disruptions to significant cash flow challenges,
this crisis will have a significant impact on the way our economy works over
the coming days, weeks and months.
A significant proportion of the
working population may now be off work at any one time during the outbreak and
with Wales particularly dependent on small and medium-sized businesses, the
impact on our economy will be significant.
As a Welsh Government we are doing
everything we can to support businesses to deal with the impact of coronavirus.
My advice to all businesses is to use the help and advice that is available.
Any business affected should
contact the Business Wales telephone helpline on 03000 603000. They can
help with practical advice - from staffing to financial planning as well as
supply chain support.
The Development Bank of Wales is
also available to help – it has equity and loan funding it can make available
immediately to otherwise healthy small businesses to them through the cash flow
and other challenges they may face in next, difficult, few weeks and months.
On Monday I announced that the
Development Bank of Wales will give a three-month capital repayment holiday to
the businesses it supports. The Bank currently supports around 1,000 businesses
and this will help them – some of our smallest SMEs ranging from small food
retailers to the creative industries – get the vital help they need.
Today I spoke with the Development
Bank Chair to discuss potential further measures we may need to take in the
coming weeks.
On Thursday I will be
having further discussions with high street banks and the British Business
Bank. I will also be convening an emergency Council for Economic
Development on Thursday this week to provide a forum for the sharing of
business intelligence and to discuss practical solutions to the challenges we
all face.
I
have been having a series of conversations with business organisations and social
partners and through our three regional offices we are utilising our collating
business intelligence to inform our mitigation and next steps.
I have met
with my senior leadership team in the Economy and Transport department
yesterday and confirmed that the regional response taskforce teams established
during our Brexit preparations will now be operational to support the
redundancy and skills needs as they emerge. Our React and Careers Wales advice
is being made available and I am actively exploring ways in which these tools
can be enhanced in the coming weeks.
Our
discussions with business groups and the intelligence we have received has
helped to shape the £200m package of support announced by the Minister for
Finance earlier today.
As part of that package retail,
leisure and hospitality businesses with a rateable value of £51,000 or less
will receive 100% business rate relief and pubs with a rateable value of
between £51,000 and £100,000 will receive a £5,000 reduction on their bill. A
further £100m will be available for a new grant scheme for small
businesses.
Whatever
further consequential funding the Welsh Government receives from the UK
Government as a result of support for businesses we will ring-fence for support
to businesses here in Wales through an enhancement of our package of support.
The
Welsh economy could be particularly affected because of the prevalence of
manufacturing and the prominence of the automotive, aviation and tourism
sectors. As well as this, workers will be affected ranging from employee
illness/isolation and looking after children may not be able to attend
school. Areas of the economy where home-working is not possible will face
a significant challenge.
We welcome the actions taken by the Bank of England, however the scope
for monetary policy levers to help is limited, not least because interest rates
were already at very low levels.
The scale of this challenge is now so
large and so urgent that only a massive fiscal policy intervention by the UK
Government can now help businesses and individuals bear the burden of what is
to come.
Furthermore,
a response co-ordinated with other major economies is now urgent and likely to
be more effective in reducing uncertainty and maintaining consumer and business
confidence than countries taking individual actions.
Avoiding a major
recession and long-term structural damage to our economy should be the UK
Government’s major economic priority. That requires a genuine, four
nation approach to supporting the economy and the lack of information from the
UK Government is currently hampering this effort.
As devolved government
we will play our part in helping to utilise that significant fiscal stimulus in
the most effective way. Collectively we need to find a way to hibernate viable businesses
affected by this crisis; protect vital supply chains and give individuals
impacted by this outbreak the financial support they need to get through. That
was very much the ask I made of UK Government during my discussion with the
Secretary of State for BEIS this morning and the letter the First Minister sent
to the UK Government earlier today.
The
UK Government needs to work with the Bank of England to ensure that the banking
system has the required amount of funding in place, and the level of flexibility
needed, to ensure the survival of viable businesses experiencing cash flow
problems. I will be stressing in my meeting with Banks here in Wales the
need to ensure liquidity it available.
On
statutory sick pay, the UK Government is bringing forward legislation to allow
small- and medium-sized businesses and employers to reclaim Statutory Sick Pay
(SSP) paid for sickness absence due to COVID-19. This will be available to
businesses in Wales and we will work with partners to ensure that employers
over the coming months set up the right repayment mechanisms as soon as
possible. I strongly urge the UK Government to use this system to support the
most economically exposed and vulnerable individuals.
The
UK Government announced a temporary Coronavirus Business Interruption Loan
Scheme to be delivered by the British Business Bank. This will be available to
businesses in Wales via the British Business Bank.
A
Time to Pay scheme has also been announced whereby all businesses and
self-employed people in financial distress, and with outstanding tax
liabilities, may be eligible to receive support with their tax affairs through
HMRC’s Time to Pay service. This is also available to businesses in
Wales.
Out transport providers are also
facing incredibly difficult challenges. I have been holding urgent
conversations with senior figures across the industry as fewer fares are
putting significant pressure on the finances of our major rail, bus and airport
services.
I have spoken a number of times to
the Chief Executive of Transport for Wales. Across the UK, including in
Wales, rail passenger numbers have fallen by up to 18% on certain lines
already. Elsewhere, Network Rail has launched a survey of its suppliers over
fears of material shortages due to the coronavirus.
Despite
the economic impact, all our operators are continuing to follow the most up to
date guidance from the public health authorities and industry bodies.
Contingency plans are in place and TfW are examining future mitigations such as
staffing, stocking as well as issuing additional sanitizer, personal protective
equipment, reviewing cleaning regimes.
Regular
advice is issued to passengers including the “catch it, bin it, kill it” campaign
by displaying posters at key stations and sending out messages through twitter
and other social media channels.
A
cross industry action team has been stood up with daily communications to
ensure they are ready to respond if the situation changes including planning
for a range of different scenarios.
The same can be said for the bus industry with additional cleaning of buses and regular reminders to staff about hygiene good practice and additional cleaning materials such as personal hand sanitiser has been issued for frontline employees, depots and work areas. Officials have met with the bus industry group and I spoke with the senior figures from the industry yesterday.
In
terms of Cardiff Airport, I spoke to the Chief Executive Officer and her team
over the weekend and my officials continue to be in close contact through this
week. The demise of Flybe left a 5.6% gap in its revenue and this crisis
will severely test the sustainability of all airports across the world as the
number of flights decline sharply. In recent times Cardiff Airport has
diversified its business base and carries less debt into this crisis than many
of its UK neighbours.
However,
as in other sectors we should be under no illusion about the scale of the
challenge ahead. Tui has said it will suspend the "majority" of
its operations and there may be other operators taking the same action in the
coming weeks. My thoughts are with all affected employees and passengers who
have had their travel plans disrupted.
I
will remain in regular contact with Cardiff Airport and the Department for
Transport on aviation and other visitor-related issues.
I hope this statement assures Assembly Members that we are doing
all we can to protect the Welsh economy and limit the impact on individuals and
businesses across the length and breadth of Wales.
When the worst of this crisis is over we must soon look to the
future – to the fairer, more compassionate and more equal economy we need to
build. As a Welsh Government we will play our full part in that work.
