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Andew Davies, Minister For Enterprise, Innovation And Networks
Business hospitality can have an important role to play in promoting and securing investment by businesses in Wales. However, to ensure effective and appropriate use of public funds, the guiding principle must be that the use of business hospitality is both directly relevant and proportionate to the likely outcomes.  

I am on record as stating that in my opinion this has not always been the case in the past.  It is for this reason – following the merger with the WDA and WTB –  that I have put in place new, robust arrangements to test and evaluate expenditure on business hospitality.  

This is based on two key principles:

• Effectiveness – why the investment makes sense and what returns we can achieve;

• Transparency – is one of the cornerstones of the way the Assembly Government operates, and which accounts for my decision to report annually to the Enterprise, Innovation & Networks Committee on the inputs and outputs of business hospitality expenditure.

These two key principles constitute the basis for the rigorous approach, which I as Minister, and Gareth Hall, as my department’s Director and Sub Accounting Officer, have set for the Department.

In today’s highly competitive world in which we fight hard for investment and trade opportunities, Wales has much to offer and has scored significant wins.  

The provision of business hospitality – networking, validating and exchanging information – is part of the way in which business is conducted and clearly has a part to play in any customer-focused and commercial approach.

While business hospitality forms just one element in our overall engagement with potential investors, failure to make use of this particular resource within the firm guidelines I have established to ensure probity and value for money would place Wales at a competitive disadvantage.

Clearly, hard returns from using the facilities are not always measurable in the short term, and have to be seen as part of a wider and longer term integrated business offer and marketing programme.

My new Department will continue to pursue opportunities for jobs and investment for the people of Wales within a framework of robust evaluation and transparency.

Millennium Stadium
It is against these principles that we have retained usage of the two hospitality boxes at the Millennium Stadium contracted by the former WDA and WTB.  The contractual restrictions inherited by the Assembly Government from the former ASPBs meant that we could not simply relinquish the boxes without incurring financial loss.  Subsequently, we have decided to make one of the hospitality boxes available to recognise and reward outstanding individual contribution for community service, and have already made available one of the hospitality boxes to raise funds for the BBC’s Children in Need appeal.

Wales has been host to a series of highly successful international events in recent years; and it makes sense to ensure we derive the greatest possible benefit from them.

Hospitality at the Millennium Stadium was used by both the former WDA and the WTB as a marketing tool, to help establish sound business relations with companies and key decision makers involved in investment decisions that could influence or seal potential benefits for Wales.  In addition, many press and media articles about Wales have been secured through travel trade journalists attending Stadium events.  

Corporate hospitality provided at the Millennium Stadium during 2005 and 2006 played a role in delivering over 1,200 jobs, with the potential of more than 3,000 in the pipeline.  Marketing, education and other programmes, have all been built around these events.  

Since 2001, the cost of hosting events at the Millennium Stadium has totalled just over £1.2 million.  This rounded figure includes the annual hospitality box licence fee (i.e. the annual rental charge), refreshments and additional tickets and hospitality packages for events not included as part of the WTB’s or WDA’s hospitality box contract.  These costs also include some limited use of the facilities we hold at the Stadium for business and training for staff.

2006 FA Cup Final
The FA Cup Final in Cardiff presented a unique, albeit relatively short window of opportunity during the reconstruction of the new Wembley Stadium to maximise engagement with prospective investors. The FA Cup Final is a global event that attracts premium charges; and a direct comparison between the costs involved in hospitality at the FA Cup Final and, for example, a Six Nations match is therefore not straightforward.

There has been some criticism of the way in which guests were hosted at the 2006 FA Cup Final and I have already made clear my concern at elements of the hospitality associated with this event.  

International Business Wales had two groups of guests:

(1) A group of fourteen guests, who, in addition to attending the FA Cup Final, also received hospitality at the Vale of Glamorgan Hotel the evening before the match (the total cost was almost £35,000 including VAT).  This group focused on the financial services sector, the growth of which has been supported by our ability to offer hospitality at key events.  As a result of our engagement with this group, we expect to announce 100 new jobs soon and we are actively pursuing a further 100 new jobs;

(2) Seven other guests, hosted separately, not sector specific and not involved in the Vale of Glamorgan Hotel event.  The overall cost was almost £9,000 and we have high expectations that around 1,800 new jobs will be announced in the months ahead.

In summary, an investment of about £44,000, combined with our other efforts, has increased our potential to secure almost 2,000 new jobs for Wales.

Disclosure of Hospitality Recipients
I have given consideration to a request to provide the names of companies or individuals who attend hospitality events organised by the Assembly Government. I have applied the same principles to these requests for events at the Millennium Stadium, or elsewhere. While seeking transparency, equally I need to have regard for our clients’ obligations to their shareholders, their staff, other parts of their businesses and, in many cases, the stock market.  As Minister, I must take account of the reality that disclosure of their interest in Wales could compromise their position and our prospects of success.  

Accordingly, I have decided we must respect market sensitive information and not disclose the names of those attending.