New First Minister for Wales – Announces a new team to plan a green economy

There was a moment at the end of Vaughan Gething’s inaugural speech when he looked up with pride to his family in the public gallery. No words, but the message was clear enough; “I am here. We made it…”

The first black leader of any country in Western Europe. Something that would have been unthinkable just 25 years ago when he first became active in Labour politics as a student at Aberystwyth University.

His father, a veterinarian from Wales, was working in Zambia when he met his mother.  They moved to Wales – and then to Dorset.

He referenced his background in his speech; “People question my motives and my nationality. Whilst others question why I’m ‘playing the race card’. To those people I say – it is very easy not to care about identity when your own has never once been questioned or held you back.”

Vaughan Gething beat his Welsh Government cabinet rival, Jeremy Miles, by a narrow margin to become First Minister, with 51% of the vote.

The campaign was not without controversy. Questions have been raised about a £200,000 donation he received from a company that has twice been convicted of illegal dumping of waste in an environmentally sensitive area.

Mr Gething points out, confirmed by party officials, that the donations he received were well within campaign rules.

The media, and some of his political opponents, will try to add fuel to this fire. The story isn’t over yet.

But the view from the business world, is that in his manifesto for the leadership campaign, and in several of the key points he made in his inaugural speech – the tone was right – and so was the talk of ambition to re-invigorate the Welsh economy, with a particular focus on green industry.

As the former Economy Minister for Wales, Mr Gethin knows all too well what the challenges are for the country as a whole, and the need for investment, to stimulate growth.

Tonight, he has shown how he intends to realign and beef up the Economy brief by awarding it to his campaign rival, now a key member of the cabinet.

Jeremy Miles has been made Minister for the Economy, Energy and Welsh Language. A role that will have increased reach and significance.

Another notable appointment is former long serving Economy Minister, Ken Skates, who will be re-joining the cabinet as Minister for North Wales and Transport. The latter part of the brief is familiar territory as he led the takeover by Welsh Government of regional railways in Wales. He is a moderate who was a key supporter for Vaughan Gething in the leadership campaign.

Two of the top jobs stay in the same hands. Rebecca Evans remains Cabinet Secretary for Finance, Constitution and Cabinet Office and Eluned Morgan holds on to what is arguably the most challenging job of Cabinet Secretary for Health.

When Mr Gething’s predecessor, Mark Drakeford, announced in the new year that he intended to step down, voices from the business community said they wished him well, but they hoped that his successor would take a closer interest in the economy and encourage closer engagement with private enterprise.

All eyes will now be on Jeremy Miles, a former Corporate lawyer, to see how he responds to the calls from business.

But the early signs are promising.

In his manifesto, Mr Gething said; “We will harness Wales’s advantages in industries such as clean energies and advanced manufacturing…”

And,

“Wales will join the wave of countries recognising governments must take a more active roles in private markets to secure better results for citizens and bolster industries providing good jobs.”

If he can hold to this commitment, this suggests greater support for innovation and business development, which is the story many business leaders want to hear.

But the challenges are manifest. Welsh Government finances are currently at breaking point, which led to a budget strewn with cuts for the year ahead.

Economic development is way down the list of priorities.

Health dominates. Out of a total budget for 2024/2025 of £23.854 bn, the NHS and Health accounts for 49.2%. That’s £11.7bn. Spending on climate change is next, at 12.04% = £2.8bn.

Education is 10.83% = £2.5bn. While funding for the economy is 2.6% = £633m.

There is hope, and general agreement, amongst the leading business organisations in Wales that if and where funds can be made available, there should be a new emphasis on ensuring the world knows that Wales is open for business – and that the process of engagement with government should be easier and less cumbersome.

One business leader told me; “This is the first time we have heard the word ‘ambition’ used for a long time and I hope the Welsh Government, under the new First Minister, will encourage closer engagement with Business so that we can work together to look at how we can grow the economy.”

Both candidates in the leadership race seemed to appreciate that there needs to be a new accommodation with business and that finding new investment is vital if Wales is to dig out of the current trough.

In recent weeks there has been talk of inventing a new arm’s length body with statutory powers that will focus specifically on economic development. Not a reinvention of the old Welsh Development Agency, but an entity that will sharpen the focus and make it easier for innovation and investment from without and within Wales.

But how will this appeal to Vaughan Gething? We shall see.

Other questions that are very much on the business agenda: What will the relationship be like between a Vaughan Gething led Welsh Government and a Keir Starmer led UK Government – should that occur?

The hope and expectation in Cardiff is that the taps will turn on and the Welsh cup will be filled. But will it?

Will a Labour government in Westminster come to the rescue of thousands of jobs at risk at TATA Steel in Port Talbot? The probability is that it will not. TATA say privately that change is inevitable and without it, losses of £1m a day are unsustainable.

For most of Mr Gething’s time in high office, he has been able to point the finger at a Tory led UK Government for failing to provide adequate funding to support devolution and the Welsh Government’s needs.

Predictably, the Conservatives’ response is that Welsh Labour has failed to manage its resources properly and has instead introduced unpopular dictates such as the 20mph speed limit which Mr Gething says he will uphold – albeit with the possibility of a revision.

In his inaugural speech Mr Gething referred to one of his predecessors, Rhodri Morgan, who would say, on difficult days, that it was “Time to put the tin hat on” moments before heading into First Minister’s questions.

Mr Gething said that when Mark Drakeford took over from Rhodri Morgan in 2018, he said he would ask his family for a tin hat for Christmas.

Said Mr Gething: “So to my relatives watching on today, I’d really rather not wait until Christmas! Sometime in the next 3 weeks would be ideal.”

He’s not underestimating the challenge and he knows he cannot afford to. But he is the man of the moment – a moment, as the favourite candidate, he has waited years to savour.