Earlier this week the Senedd’s Economy, Trade and Rural Affairs Committee raised serious concerns about the performance of Wales’s city and regional growth deals, particularly in North Wales and the Cardiff Capital Region.
These deals were launched with the promise of transforming our economy, rebalancing regional growth and creating thousands of jobs. Yet the committee’s findings show patchy progress and growing risks that threaten to undermine their original ambition.
In North Wales, just 35 jobs have been created and £1.8m of private investment secured to date, after its flagship nuclear project at Trawsfynydd fell through.
Meanwhile, Cardiff Capital Region is tied up in the massive redevelopment of the former Aberthaw Power Station, bought for £8.6m, with £30m already spent on demolition and estimates that full development could cost over £1bn. A procurement dispute has already resulted in a £5.25m settlement, and despite supposed interest from investors, the sheer scale of risk to public finances is troubling.
Even Swansea Bay, which has often been held up as a success story, has only created 896 jobs since 2017 against an original target of 9,700 and while it has leveraged £133m in private investment, that remains far from the transformational change that was originally promised.
Too often, these city and growth deals have slipped into being slow-moving property schemes. Sites are bought, plans are drawn up, and years pass while the private sector they were meant to support is left waiting.
If Wales is serious about growth, we need to rethink what these deals are for and who they are meant to serve, with an overwhelming priority to get funding flowing directly into the private sector.
Rather than tying up hundreds of millions in long-term, high-risk regeneration sites, city and growth deal boards should focus on shovel-ready projects led by businesses or consortia of firms that can create jobs and investment now. T
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hat means supporting companies that are ready to expand, invest in new products or facilities, or export to new markets i.e. firms that already have customers, orders and private capital on the table.
At the same time, we need to build the right kind of infrastructure. This does not mean more speculative land purchases or years-long master plans, but infrastructure that directly supports business growth and accelerates economic activity.
We should be creating innovation hubs and incubators to house and grow start-ups, investing in high-speed digital networks to support tech and creative firms, developing clean energy testbeds and industrial demonstrators to attract private R&D, and establishing specialist training centres linked directly to local employer needs. This sort of infrastructure reduces the cost, risk and time to market for private firms and creates an environment where entrepreneurs can start, scale and stay in Wales, rather than feeling they must move elsewhere to succeed.
We must also put entrepreneurship and innovation at the heart of these deals. Wales has some exceptional entrepreneurs, but too few of them get any meaningful support from the current model. Entrepreneurship support should be directly embedded into the deals through venture studios, proof-of-concept funding, seed and co-investment funds, and accelerators that build commercial capability and leadership.
We should also focus on developing sector-based innovation clusters around regional strengths such as advanced manufacturing in North Wales, fintech and creative industries in Cardiff, green energy in Swansea Bay, and agritech in Mid Wales. These clusters can act as magnets for private investment, talent and spinouts, while creating high-value local supply chains that anchor growth in the region.
Finally, and perhaps most importantly, we must tackle Wales’s productivity gap head-on. Productivity is the engine of economic growth, and Wales continues to lag behind the 海角视频 average. Without improving it, we will not raise wages, profits or living standards, and we will never close the prosperity gap with other parts of the 海角视频.
Crucially, productivity is not just about technology or machinery, it is about people and the evidence shows that improving leadership and management capability and developing workforce skills are two of the strongest drivers of productivity. This means investing in leadership and management development for SME owners and managers, in workforce upskilling (particularly digital, technical and problem-solving skills) and in partnerships between colleges, universities and local employers to build the talent pipelines our businesses need.
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Wales’s city and growth deals were meant to drive transformation, but right now too many are stuck and nowhere near reaching their full potential.
If they are to succeed, then they need to stop thinking like property developers and start thinking like economic developers. That means backing shovel-ready private sector projects, building infrastructure that directly supports business growth, embedding entrepreneurship and innovation into every region, and making productivity the central goal.
If we do that, we can still deliver on the ambition these deals promised, not just through the development of new sites, but by encouraging and supporting a new generation of thriving Welsh businesses that will create well-paid jobs and drive long-term prosperity.