Îʶ¦ÓéÀÖ

The term ‘foundational economy’ refers to the sectors of the economy that provide the goods and services that underpin everyday life. The Îʶ¦ÓéÀÖis focused on the organisations and people in these sectors, as well as the quality and accessibility of the goods and services they provide. The foundational economy is more than just infrastructure, employment and output. It is also citizens’ sense of control and belonging in their community. These sectors are by their nature immediate to people’s surroundings, and so they are vital social as well as physical infrastructure.

The foundational economy sectors the Îʶ¦ÓéÀÖhas a strategic focus on are: 

• care and health services (including social care and childcare)
• management of social housing
• construction of residential and commercial buildings, energy and utilities
• food
• high street retail and services
• tourism
• public transport.

The foundational economy approach is centred around the Well-being of Future Generations (Wales) Act 2015, which aims to improve the social, economic, environmental, and cultural well-being of Wales.

In working with stakeholders, foundational economy objectives will be delivered through a ‘People, Procurement, and Place’ approach:

• Organisations should consider the impacts of their decisions on People (ie workforce and local population), Procurement, and Place (the impact on their local area, for example service location contributing towards regenerating high streets).

• Identify and support opportunities for more jobs, better jobs, greener jobs and promote fair work, including good pay, representation, security, and opportunity to progress.
• Increase ‘household liveability’ by facilitating rising wages through promotion schemes such as Real Living Wage, helping increase the affordability of foundational essentials to support universal access to high quality goods and services.
• Build local supply chains to keep people, skills and wealth in Wales.
• Contribute towards addressing the climate and nature emergencies.
• Encourage collaborative innovation and experimentation to improve basic goods and services, especially where these build resilient social infrastructure, such as through cooperative and community-owned projects.

Helping suppliers 

• Working with Social Business Wales and Business Wales to grow resilient and responsible local supply chains.
• Helping companies upskill and access training to give the foundational economy sectors the skills they need and foster innovation.
• Helping companies achieve the necessary accreditations to operate in their sectors

Public procurement and social value 

• Leveraging the public purse to do business with responsible firms that add social, economic, environmental and cultural value, supporting the Wellbeing of Future Generations Act and Social Partnership and Public Procurement Act.
• Making procurement opportunities more accessible to small firms by encouraging collaboration and consistency of approaches across contracting bodies.

Direct investment and decarbonisation 

• Supporting investment in renewable energy technologies in a number of ways, including through .
• Investing in decarbonisation via support for public transport and improving energy efficiency in housing stock.
• Working in partnership with the UK Government to support offshore wind investment and national grid upgrades.   

Growing awareness of the foundational economy

• Embedding understanding of the Îʶ¦ÓéÀÖ Government’s definition of the foundational economy and supporting objectives.
• Building public understanding of the foundational economy through dedicated web pages and content.
• Building ‘communities of practice’ and stakeholder alliances to promote innovation and sharing of best practice.
• Collecting and analysing data to understand the state of the foundational economy. 

Supporting workers

• Supporting fair work through advocacy and new public procurement clauses.
• Supporting businesses that implement fair work principles to grow and increase their impact.
• Promoting the payment of the real living wage across the foundational economy.

Supporting communities

• Encourage citizen and community participation in the delivery of foundational sectors.
• Facilitate a diversity of providers, including social enterprises, co-operatives and community owned projects.