Programme for government 2026 to 2030: New ambition for Wales - Chapter 3: Unleashing the potential of the Welsh economy, and creating good well-paid jobs

“ We are committed to generating wealth and retaining it within our communities as well as addressing regional inequalities.”

Our ambitions for Wales rest on a flourishing economy that fuels our public services, creates fulfilling and rewarding jobs, and provides the foundation for a stronger future.

We are committed to generating wealth and retaining it within our communities as well as addressing regional inequalities. Economic growth increases funding, through devolved tax receipts, for the public services we rely on and helps government to invest in long‑term actions for the future.

Too often in the past we have seen economic ambitions not matched by actions that support our economy to grow. As a society we all depend on a strong economy. We will draw on international evidence of what works to invest in Welsh based businesses, helping them to grow and prosper. We will use all of the levers available to us to ensure that there is a supporting infrastructure that fosters them, and that our public services work to support a healthy and skilled workforce. In return businesses can help us invest in the services, and economy, of the future.

Increasing productivity is at the heart of our economic plans – ending generations of low productivity and halving the productivity gap with the rest of the UK within 10 years.

An economy with healthy productivity growth creates more value from the skills, time and resources available to it. This helps businesses grow, invest and compete. It helps to create jobs, increase wages and improve living standards. It can also lead to higher levels of innovation, entrepreneurship and business growth which can attract private investment for critical local, national and digital infrastructure.

We will:

• progress our productivity mission which will consider all government activity with reference to driving up productivity.
• establish a new Economic and Fiscal Commission to help us set targets, collect relevant data and measure progress to make government more accountable for its economic decision making.

We have many businesses in Wales that already punch above their weight, but we know that our economy is bursting with untapped potential.

Medium‑sized businesses (those employing between 50 and 249 people) are the backbone of our communities. We will seek to sustainably grow the numbers of these businesses in Wales. We will create the conditions to unlock the existing potential and build a more sustainable economy that puts money into people’s pockets.

We will:

• create a new, business‑led National Development Agency, at arms‑length from the Welsh Government, to help Welsh businesses to grow, innovate and trade internationally, secure inward investment, and increase numbers of good quality, well‑paid and sustainable jobs. The agency will work for people across the nation and across the economy.
• reform the Development Bank of Wales and the financial products it offers to support the growth of medium‑sized businesses and ensure that its financing promotes and embeds fair work and a Real Living Wage.

Welsh public bodies spend more than £11 billion every year procuring goods and services. 

We want to see as much of this money as possible spent with Welsh businesses, fuelling our communities and transforming regional economies. It is an effective way for us to invest in Welsh businesses, increasing both the competitiveness and sustainability of small and medium‑sized enterprises (SMEs) and supporting the creation of tens of thousands of well‑paid jobs. It can also contribute to our wider goals of fairness and environmental sustainability.

We will:

• aim to increase the level spent on procuring goods and services from Wales‑based suppliers towards 70%, using public procurement as a driver of economic growth. We will introduce a new measure of Welsh economic value from public procurement to maximise the economic and social benefits that public spending delivers for Wales.
• develop the supply chain for Welsh timber, using public procurement to stimulate demand, and promote innovation and business growth in the sector, whilst improving resilience and working with the sector to deliver on the Welsh Timber Industrial Strategy.
• adopt a Fair Work First approach to awarding public sector grants, loans and contracts.

At the heart of our town centres are successful businesses that make our high streets vibrant places to work and socialise.

Town and city centres must be welcoming, liveable and thriving, and this can only be achieved through a holistic, integrated approach to planning, policy and funding.

We will:

• reform and rebalance business rates to better support high street businesses in hospitality, leisure and retail.
• use the Town Centre Taskforce to explore the options around revitalising our town centres including bringing empty properties into use as social housing.

Communities across Wales are taking their economic futures into their hands by establishing social enterprises, community-owned enterprises and co-operatives.

Our ambition is to make it easier for valued local assets to be brought into community ownership.

We will:

• legislate for a community right to buy to empower communities to take ownership of local assets.
• provide more specialist support to create, grow and sustain new co‑operative, employee‑owned, and social businesses, and improve their access to finance through the Development Bank of Wales.

An effective skills system depends on a clear understanding of our skills requirements ensuring that education and training opportunities – including apprenticeships – are in line with the needs of Welsh employers and industries and are those which will help us build strong and cohesive communities with effective public services.

With a rapidly changing economy and society, we will be agile enough to adapt quickly to future opportunities and workforce needs. We will be clear with our universities and colleges, the cornerstones of the skills system, on what those needs are. It is also imperative that we have a skills system that is easily accessed by learners, with accessible education and training options to prevent people slipping into economic inactivity or becoming NEET.

We will:

• develop a Skills Strategy for Wales, informed by a national skills audit, to align skills provision, vocational education and qualifications with current and future economic needs. We will support a system that strengthens pathways into education, training and employment, helping people gain the skills, support and opportunities they need to enter, remain and progress in fair, secure and sustainable work.
• take steps to create a financially sustainable tertiary education system that delivers high‑quality education, skills and research, supports collaboration across the sector, and secures long‑term value from public investment, starting with our independent review of higher education funding.
• work to ensure that young people in Wales can live, study and work in Europe – including by maximising the opportunities for Welsh students that stem from the UK rejoining the Erasmus+ scheme and examining options for the future of the Wales‑specific Taith programme.

Boosting digital and transport connectivity is key to unleashing the economic potential of Wales, delivering modern and efficient public services, and in turn raising our living standards.

We cannot ignore the opportunities and risks now seen by artificial intelligence (AI) in everyday lives. We must harness the potential of digital and AI innovation, whilst maintaining a clear focus on safe, ethical and cyber secure adoption, and ensuring access to superfast connectivity.

We will:

• deliver a new Digital Strategy which will support digitisation and innovation in the Welsh economy, drive forward public service digital transformation, and deliver the conditions to support safe and ethical adoption of AI to support productivity and more efficient public services.
• continue to work with UK government and telecoms providers to ensure businesses and homes have access to superfast broadband at a minimum.

We are creating a modern, integrated and inclusive transport system, run for the benefit of passengers not shareholders. Better connectivity within Wales, across the UK and internationally will support our economic ambitions by helping businesses to grow, making it easier for people to access work and promoting equity of access to culture, heritage, and sports provision. 

We will review and refresh the Wales Transport Strategy to provide a clear framework for delivery, ensuring our transport system supports economic growth, improves access to opportunity and better connects communities across Wales. The delivery of Transport for Wales’ £14 billion 'Today, Tomorrow, Together' vision, which the UK government has committed to fund, would transform rail services, making it easier for people to access jobs, education and leisure activities.

We will:

• prioritise the resilience of connections across the Menai Strait through short and medium‑term improvements whilst planning for long‑term solutions.
• work with partners to address road resilience in the South‑East Wales corridor.
• promote road safety and ensure that our roads are safely maintained.
• bring forward a renewed pipeline of short, medium and long‑term priority rail projects. Create a more integrated public transport network by expanding tap‑on, tap‑off, pay‑as‑you‑go ticketing, introducing simpler and fairer fares across bus and rail to improve services for passengers and communities across Wales, making travel simpler and more affordable.
• continue to provide £1 single bus fares and £3 day tickets for children and young people aged 5‑21 and retain bus passes for over 60s and disabled people.
• transform bus services through franchising, bringing routes, fares and standards under a single publicly accountable system that puts passengers first. We will enhance links between communities through the new North‑South coach service and deliver an integrated network that improves access to services, supports economic growth, and helps reduce carbon emissions.
• deliver a renewed EV strategy for Wales.
• put active travel at the heart of Wales’s transport system, making it a practical, safe and inclusive choice for more everyday journeys. We will reduce barriers to walking, wheeling and cycling to support our ill health prevention mission, and promote wellbeing and economic opportunity.
• put children and young people at the heart of a joined‑up approach to learner travel, strengthening cross‑government working so that public services work together to improve access to education, including by addressing barriers to Welsh‑medium education.
• take a strategic approach to secure Cardiff Airport’s long‑term sustainability and maximise its economic potential.
• work with Welsh ports to strengthen their resilience and maximise their contribution to the Welsh economy, while pursuing full devolution of port regulation.

Farmers, fishers and the food sector are the backbone of the rural economy, supporting the Welsh language and culture, stewarding the rural environment and improving food security.

We are proud of our tradition of producing high‑quality food and produce that is enjoyed across Wales and exported around the world, creating jobs and raising Wales’ profile globally.

Rural areas face particular challenges, and we will take action to address these barriers so that communities are empowered and businesses are supported. We will support a thriving rural economy as well as supporting communities to flourish and sustaining Cymraeg as a living language in many rural areas.

We will:

• support the agriculture sector in Wales in a way that underpins the long‑term sustainability of farm businesses and protects the future of the Welsh family farm in a changing climate. We will evolve and refine the Sustainable Farming Scheme, in strong collaboration with the farming community, so that it supports a thriving agriculture sector to produce food while also progressively delivering key environmental outcomes.
• implement a new approach to managing nutrients across catchments, moving away from the “farming by calendar” approach and supporting farmers to reduce agricultural water pollution.
• introduce a new Bovine Tuberculosis (TB) Plan, taking a holistic approach to eradication that is evidence-based and science‑led, incorporating the 3 pillars of cattle, people and wildlife.
• Develop a renewed and science‑led Animal Welfare Plan, addressing the welfare of both companion animals and farm animals.
• support a sustainable fishing and aquaculture industry, and the communities that rely on it, as part of the food system and economy.
• deliver a Rural Development Strategy for Wales.
• legislate to require rural proofing of spending plans and policy programmes to ensure they are fully responsive to the needs of rural communities. Deliver a new comprehensive National Food Strategy.
• examine options for extending permitted development rights for single dwellings and converting farm buildings for residential use to improve access to affordable housing in rural areas.

Generating more renewable energy will achieve greater energy security but also underpin our approach to net zero by 2040. We are setting out a long-term plan to provide greater certainty for developers and communities, harnessing emerging green technologies.

We will make sure that Welsh people and communities have more ownership of renewable energy initiatives and that they and their communities receive their fair share of the profits. Our ambition for devolving the Crown Estate is also central to this aim.

We will:

• develop a National Energy Strategy, mapping Wales’s current and future energy needs and setting out a clear, long‑term plan for the infrastructure required to meet them.
• coordinate action across government and key sectors through delivering a new Renewable Energy Sector Deal.
• merge Trydan Gwyrdd Cymru, Ynni Cymru and the Welsh Government Energy Service to create a strengthened national energy company to grow community ownership.

Wales is a top-quality tourism destination, and we will promote it as such, with a focus on increasing local ownership in the sector.

We will ensure that tourism – and any visitor levies – benefit local communities and we will celebrate and strengthen Wales’s unique culture, creativity, heritage and language. This will build on best practice like the 'Gwynedd and Eryri Sustainable Visitor Economy 2035 Strategic Plan'.

We will:

• review the 182‑day threshold for holiday accommodation and create clear and reasonable new exemptions where that accommodation would not qualify as a private home.
• work with local authorities to review the effectiveness of existing measures on second homes and holiday lets and assess what further action is needed to help young people remain in their communities and to promote the Welsh language and culture.
• review the role of Visit Wales and consider whether it is the best model for supporting tourism and promoting careers in the industry.

Planning must reflect and respond to local needs and be grounded in a system that is consistent, clear and efficient in every part of Wales.

An effective planning system underpins our ambitions for Wales, supporting our productivity drive, our vibrant communities and a bright future for the Welsh language. Over time, a patchwork of different regional development initiatives and structures tasked with promoting regional development has emerged.

To ensure that planning supports our vision for Wales, we need a new integrated, logical framework which will provide strategic oversight and vision, turning our ambition into reality.

We will:

• reform the planning system, so it better serves our people, communities and businesses, building a more connected and prosperous Wales.
• overhaul spatial planning and produce a National Development Framework for Wales that provides renewed vision and oversight on an all‑Wales basis.
• replace the current fragmented and overlapping approaches to marine management by delivering a Marine Planning Framework, built on genuine co‑management with fishers, environmental, community and industry stakeholders.