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Business

Bullying claims at Development Bank ‘extremely worrying’

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ENTREPRENEURS have been bullied and forced to hand over control of their businesses after approaching the Development Bank of Wales for financial support, the Senedd heard.

Paul Davies, who chairs the economy committee, raised “extremely worrying” evidence from Dylan Jones-Evans, an economist and academic, about the Development Bank.

Mr Davies said the committee also received emails from people who had dealings with the bank and felt they had been bullied out or had their businesses essentially stolen.

Prof Jones-Evans told the committee: “Unfortunately, I have been approached by … businesses prior to this review who feel they have not been treated fairly with valuations being too low, where decisions have taken far too long, and where terms are unacceptable.

“Worst still, there have been instances where some have been bullied by the directors imposed on them, where they have been forced out by dubious means and where founders feel they have not been supported by the bank.”

Prof Jones-Evans warned that young, inexperienced founders found themselves in this position and should have received far greater support.

Mr Davies said: “If these reports are accurate, those actions may well have extinguished that entrepreneurial spirit, which would be an absolute tragedy and exactly the opposite of what the bank was established to do.”

The former Tory group leader added that much of the testimony was supplied anonymously, which limited the committee’s ability to scrutinise the evidence.

But he cautioned: “It only takes a brief look on a news website to find situations where allegations such as bullying have been made against other public institutions where, in some cases, they have been ignored and, as we know, sometimes these cases do not end well.”

Mr Davies stressed: “I just want to be clear: I have discussed these accusations with the bank via correspondence and in a private meeting and they absolutely refute them.”

Leading a debate on November 27, he said most of the evidence received by the committee, which made 13 recommendations, was supportive of the bank and its operations.

Mr Davies also raised concerns about the Development Bank being reclassified by the Office for National Statistics as central government in 2021.

He explained this leads to “double counting”, with the Welsh Government having to keep money in reserve to cover any uninvested funds given to the bank.

Plaid Cymru’s Luke Fletcher said the transition from Finance Wales to the Development Bank marked a step change in 2017, with investment doubling to £124m by 2022/23.

Mr Fletcher advocated merging the bank with Business Wales to create a one-stop shop.

Labour’s Hefin David pointed out the bank is not covered by Wales’ Future Generations Act, raising suggestions a social value clause could be inserted into grant and loan agreements.

Samuel Kurtz, the Conservatives’ shadow economy secretary, raised warnings from the Federation of Small Businesses of “massively fragmented” business support.

He expressed concerns about troubling evidence from Prof Jones-Evans that the Development Bank did nothing to stop imposed directors bullying out founders.

The economy committee scrutinised bank executives on November 20, questioning a 3.2% cost-of-living pay rise awarded to all staff including those earning six-figure salaries.

Dr David pointed out that annual remuneration for the highest-paid director increased by 20% from £217,000 to £260,000 between 2023 and 2024.

Giles Thorley, chief executive of the bank, which wrote off £27m in 2022/23, said 3.2% was lower than the Welsh Government’s rise, attributing the 20% to performance-related pay.

Rebecca Evans, Wales’ economy secretary, said the Development Bank has invested £778m in more than 3,900 businesses since 2017, supporting 41,700 jobs.

She said: “That’s a total impact of £1.66bn on the Welsh economy – real investment, real businesses, real growth, supporting businesses in every part of Wales.”

Turning to concerns received by the committee, Ms Evans said: “Finance can be complex and I am aware there are times when customers don’t understand the role of the bank or the obligations of the bank and this can, regrettably, lead to misunderstandings and complaints.”

She added: “I’ve had the opportunity to address concerns with officials. It is the case, though, that founder members of companies are sometimes removed by their boards.”

Ms Evans told the Senedd she has confidence in the leadership of the bank and its board, with an external review set to take place next year.

Business

Pembrokeshire households could benefit from new energy infrastructure

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HOUSEHOLDS in Pembrokeshire and other areas near new or upgraded electricity pylons are set to receive bill discounts of up to £2,500 over 10 years, as part of the government’s “Plan for Change.” This initiative, included in the upcoming Planning and Infrastructure Bill, ensures that communities benefit directly from hosting vital grid infrastructure—critical for the growing renewable energy sector in West Wales.

Under the new legislation, households within 500 metres of new or upgraded electricity transmission infrastructure will receive electricity bill discounts amounting to £250 per year. This will provide significant financial relief to rural communities while supporting the expansion of the national grid—particularly important for Pembrokeshire as it prepares to accommodate new offshore wind developments in the Celtic Sea.

In addition to bill discounts, new guidance will require developers to fund community projects such as sports clubs, educational programmes, and leisure facilities. The government has emphasized that communities hosting infrastructure should see direct benefits, which will also accelerate the transition to clean energy and reduce reliance on fossil fuels.

Pembrokeshire’s role in clean energy

With major offshore wind farms planned for the Celtic Sea, Pembrokeshire is set to become a central hub for renewable energy, bringing investment and infrastructure upgrades. New transmission network developments will be essential to transport this clean energy across Wales and beyond. Community benefits will help ease local opposition and planning delays that have slowed previous projects.

Building new transmission infrastructure is vital for economic growth, unlocking £40 billion annually in private investment, creating jobs, and securing the UK’s energy future. This investment will also protect consumers from volatile fossil fuel prices, which caused energy bills to spike following Russia’s invasion of Ukraine.

Government commitment to clean energy

Deputy Prime Minister and Housing Secretary Angela Rayner said: “We owe it to the people of this country to get Britain building again. This is not about whether we build the infrastructure we need, but how we do it in partnership with local communities.

“This government’s Planning and Infrastructure Bill will slash energy bills for people living near new projects, ensuring they benefit as we drive forward our mission for a more prosperous and energy-secure future.”

Energy Secretary Ed Miliband echoed this sentiment, stating: “The only way to make Britain energy secure and bring down bills for good is to end our reliance on fossil fuel markets and replace them with clean, homegrown power.

“As part of this effort, we are delivering on our commitment to ensure communities hosting new infrastructure receive meaningful benefits.”

Industry support

John Pettigrew, CEO of National Grid, welcomed the announcement, stating:

“It is right that communities see enduring, tangible benefits for hosting transmission infrastructure. We look forward to working with communities to deliver long-lasting and meaningful benefits alongside critical infrastructure.”

James Robottom, head of policy at RenewableUK, added: “We welcome the government’s latest steps to accelerate infrastructure development. Guaranteeing lower electricity bills for local communities is a positive step forward. By bringing communities on board, we can speed up the rollout of essential grid infrastructure and strengthen the UK’s energy security.”

Community investment funds for Pembrokeshire

The new guidance also establishes funding for communities hosting grid infrastructure. For every kilometre of overhead electricity cable, communities could receive £200,000 in funding, while substations could generate up to £530,000 in community investment. This means that areas in West Wales affected by new grid connections for offshore wind farms could see millions in funding for local projects.

Pembrokeshire is already seeing a transformation, with the proposed floating offshore wind farms in the Celtic Sea expected to generate thousands of jobs and significantly boost the local economy. Milford Haven, already a major energy port, is set to play a key role in the UK’s renewable energy future, with new grid connections ensuring that power from the Celtic Sea reaches homes and businesses efficiently.

The UK’s electricity grid, originally designed in the 1930s, requires significant upgrades to accommodate renewables. Expanding grid infrastructure will reduce constraint costs—where wind farms are paid to shut down due to a lack of capacity—ultimately lowering energy costs for consumers.

With these measures, Pembrokeshire communities closest to new energy infrastructure will benefit from both clean power and financial savings, reinforcing the region’s position as a leader in the UK’s green energy transition.

The upcoming Planning and Infrastructure Bill will introduce additional measures to accelerate the UK’s clean power transition, unblocking vital new energy infrastructure projects and ensuring that rural communities, including those in West Wales, benefit from the energy revolution.

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Business

Welsh economy grows, but job losses and inflation persist

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THE WELSH economy showed signs of recovery in February, with business activity rising for the second consecutive month, according to the latest NatWest Wales Growth Tracker. However, challenges remain, as job losses continue, inflationary pressures persist, and new business orders decline.

Business activity expands, but demand falls

The Wales Business Activity Index, which measures monthly changes in the combined output of the region’s manufacturing and service sectors, increased to 51.5 in February, up from 50.7 in January. This marks the strongest growth in six months. However, despite this expansion, new business orders declined for the fourth month in a row, reflecting weak domestic demand and uncertainty surrounding government policies.

Job losses accelerate

While business output has increased, companies remain cautious about hiring. February saw the sixth consecutive month of job losses, with employment levels declining at a sharper rate than in January. The reductions were attributed to voluntary departures not being replaced, redundancies, and changes in labour policies. Despite this, the pace of job cuts in Wales was slower than in the UK as a whole.

Inflation pressures remain

Inflationary pressures persisted in February, with input costs rising at the fastest rate in ten months. Businesses reported higher labour costs and rising import prices as key drivers. In response, many firms increased their prices for goods and services, leading to the sharpest output price inflation in nearly a year. However, inflation levels remain below post-pandemic peaks and lower than the UK average.

Optimism for the year ahead

Despite the challenges, Welsh firms expressed the highest level of confidence in five months, expecting growth to continue over the next year. Business leaders are optimistic about expansion, citing strategic growth initiatives, productivity improvements, and new customer acquisitions.

While Wales’ economy is showing early signs of recovery, persistent job losses, sluggish demand, and inflation continue to pose risks. The coming months will be crucial in determining whether the region can sustain its growth momentum or if economic uncertainty will drag it down once again.

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Business

Cardigan shop wins St David’s Day competition

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CARDIGAN Curiosities has won the St David’s Day shop window award for the Cardigan division, an accolade presented by Menter Iaith Ceredigion.

High Street businesses and Guildhall shops embraced the festivities, decorating their windows in a vibrant display to celebrate the national day of Wales and the arrival of spring. The event, which highlighted the Welsh language, saw enthusiastic participation from across Ceredigion.

To mark the occasion and show appreciation for the community, Cardigan Curiosities is offering the chance to win an exclusive piece of local artwork. The prize is a one-of-a-kind watercolour painting of the nave of St David’s Cathedral, created by a Pembrokeshire artist. The framed artwork measures 74×95 cm.

To enter the competition, participants must:

  • Visit the Cardigan Curiosities Facebook or Instagram page
  • Like the competition post
  • Comment with their favourite Welsh word

The winner will be drawn on March 20 by “Ddraig Goch” from inside a dragon egg, with the announcement made that evening on social media.

For those interested in viewing the artwork or the decorated shop window, Cardigan Curiosities is located at 32A Cardigan High Street and is open Thursday to Sunday, from 10:00am to 5:00pm.

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