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As noted last week, the economic manifesto from the Welsh Labour Party for the 2021 Senedd elections is very much a continuation their approach during the previous five years with few ideas put forward to radically transform the Welsh economy.
In contrast, Plaid Cymru’s long and detailed manifesto seemingly wants to change everything and is teeming with countless ideas that aim to create a new and very different approach to economic development.
The main challenge in trying to assess this manifesto is that it does seem, at times, like a white board full of post-it notes that has yet to be honed sufficiently into the small number of key priorities that any party forming a government would need to focus on to deliver a coherent programme over the next five years.
Nevertheless, there are some interesting proposals that could be impactful on changing the direction of the Welsh economy.
Perhaps the most significant is the focus on the “Local First” principle which aims to increase Welsh firms’ share of contracts from 52 to 75 per cent of the public procurement budget.
This is an issue that I have been discussing regularly in this column since 2004 although no Welsh government has taken up this challenge properly despite this being the one tangible policy that can support businesses and create employment in many local communities across the nation.
Indeed, the majority of the new jobs promised by Plaid Cymru within the manifesto is related to this proposal through the implementation of policies as such as reducing bureaucracy from public sector tendering and breaking up contracts into the smallest possible lots to enable small companies to bid.
Whilst the Labour Party is (in)famous in Wales for its bonfire of the quangos sixteen years ago, the Plaid manifesto looks to reverse this decision through the introduction of not one new body but three namely Prosperity Wales as an arms-length all-Wales development agency to provide effective policy delivery; the Arfor Agency to develop the western seaboard of Wales; and the creation of a Valleys Development Authority.
Some will question whether creating new structures is more important than a clear strategy although one thing that the Covid pandemic has highlighted is the need for a greater focus on policy innovation and delivery which has been largely suffocated within current civil service arrangements.
Whether these new bodies would tie in with current city and growth deals remains uncertain, but it is clear that a future Plaid Cymru Government would seek to have a more interventionist and spatially focused approach than we have seen for a long time here in Wales.
With so many policies within the manifesto, it would be easy to miss out on some of those that have only been mentioned in passing but which could have a significant impact including expanding and electrifying the rail network, creating a Gigabit connection throughout Wales, retrofitting thousands of homes to the highest environmental standards and repurposing empty shops and offices.
However, one of the most significant of these is the proposal to establish a Small and Medium Enterprise Investment Strategy which would provide long term loans at zero interest with long repayment holidays and new deals for early stage and growth companies. This would finally reflect the original principles behind the creation of the Development Bank of Wales namely to ensure that everything is done to
give Welsh firms a real competitive advantage through access to finance.
Of course, the implementation of all of these ideas would have to be paid for and given the new philosophy of borrowing for investment at Westminster, it is not surprising that a similar case is made for Wales including suspending the Welsh Government’s £150m annual borrowing limit and increasing the overall borrowing capacity from £1 billion to £5 billion over five years.
So where are the similarities between the two manifestos and potential areas where there could be further agreement if there is no overall majority for either party after May 6th?
The main consensus seems to be on a focus on green jobs with Plaid Cymru proposing a multi-billion pound Green Economic Stimulus which will generate 60,000 jobs over the five-year term. There is also a promise, broadly similar to the Labour manifesto, to establish a national youth job guarantee scheme for every 16 to 24-year-old which many will welcome.
However, most of the other proposals are very different and are far more interventionist than anything we have seen under the last two successive Labour-led Governments or, for that matter, under the 2007-2011 coalition between the two parties when Plaid Cymru held the economy brief within the cabinet.
But despite so many ideas, it’s disappointing that there seems to be no tangible proposals to deal with the challenges of the immediate post-Covid recovery especially for the tourism and hospitality industry.
Yes, £6 billion of additional investment is promised over five years but many businesses will need support immediately over the next few months and cannot afford to wait for new structures and organisations to be created.
There also seems to be little understanding or detail of the need for more businesses in the Welsh economy. Whilst there is a broad promise that launching new ventures in new areas will be at the heart of Plaid’s economic strategy, there seems to be very few suggestions on how to do this.
Therefore, this is a manifesto for considerable change that some would argue is paramount for a Welsh economy that is not only one of the poorest in the UK but will be faced with considerable challenges over the next few years.
And whilst its revolutionary ideas contrasts with the evolutionary approach adopted by the Labour Party, there are several critical policies ideas within this document that any new Welsh Government would do well to consider carefully regardless of the election outcome.