12 October 2018
‘The Welsh Economy is facing the challenge of a lifetime…there is an opportunity for transformation – both positive and negative’. That’s the conclusion of the Assembly’s Enterprise, Infrastructure and Skills (EIS) Committee’s ‘Industry 4.0 – the future of Wales’ (PDF 1.50MB) report. This report is a result of its ongoing exploration of the impact of Automation in Wales.
The report summarises the findings of the first stage of the Committee’s Automation and the Welsh Economy Inquiry, which consisted of four panels. The first panel discussed automation and the forth industrial revolution (industry 4.0) in general, while the following three focused on: precision agriculture, Connected and Autonomous Vehicles (CAVs) and the future of skills. The Welsh Government outlined its thinking on all three matters in written evidence to the Committee (PDF 155kb).
In advance of the Assembly’s debate on the report on 17th October (it can be watched live here, or a recording of it will be available here) this blog provides an overview of the report’s findings and the Welsh Government’s response (PDF 420KB).
Overall the Committee found that there are many benefits that can be gained from the rapid advance of high technology and automation for those who are prepared. As a result it made four high level recommendations to the Welsh Government as to how it can best maximise the benefits of industry 4.0. The Welsh Government accepted the recommendations to:
- ensure Wales is a provider, not just a consumer, of new and emerging technology through identifying and supporting the growing industry in Wales;
- review how it supports Welsh companies to access the UK Research, Development and Innovation Fund; and
- harness the expertise of experts in Wales, the alumni of Welsh universities and the Welsh diaspora to develop the future of Welsh industry.
But the Welsh Government rejected the Committee’s recommendation to carry out an analysis of the benefits of creating a ‘model community’ where new technologies could be tested. The Welsh Government argued that it would not be possible to contain ‘all of the characteristics, demographics, topography, and so on’ within a single model community. Instead it intends to work with different sites across Wales.
The Committee heard that precision agriculture can bring multiple benefits for farmers and the environment in Wales. The new technology could result in:
- better crop management through improved electronic tracking;
- much less pesticide and other agents being used in farming through electronic targeting of weeds, reducing chemical run off; and
- farming becoming a more desirable profession for young people through eliminating some of the perceived drudgery, through the expansion of automated milking of cows on smaller farms for example.
To achieve these results the Committee recommended that Welsh Government collaborates with the post 16 education sector to develop precision agriculture software and hardware suitable for Wales’ small farms.
The Welsh Government noted that this sector has access to numerous funding schemes, including its own, EU funded, SMART Expertise programme and the UK Government’s InnovateUK. It committed to working with academic institutions to explore the funding opportunities arising from these schemes.
In response to the Committee’s wish to see the Farming Connect programme better aligned with academia in Wales, the Welsh Government noted that it’s review of the programme will continue:
…until such time as we gain a proper insight into the basis on which the UK will leave the EU, our future trading arrangements and clarity on the long-term funding of agriculture from the UK Government.
As such, any major changes are unlikely to happen until after this time.
Connected and Autonomous Vehicles (CAVs)
The Committee heard that ‘it’s going to take about 20 years for us to see autonomous cars everywhere’. The arrival of Connected and Autonomous Vehicles (CAVs) will present opportunities for those that adopt them, including reducing road accidents, traffic congestion and vehicle emissions.
However, to realise these benefits society will need to navigate difficulties such as societal acceptance of the potential errors by CAVs, ensuring the cyber security of CAVs and developing the digital and physical infrastructure they need.
In order to address some of the challenges, the Committee recommended that the Welsh Government should encourage CAV companies to share pre-crash data to improve learning and safety in the sector and to carry out a cost benefit analysis of the creation of a 5G CAV test centre in Wales.
The Welsh Government accepted these recommendations. It noted that to promote the sharing of pre-crash data, it would ‘will explore what means can be achieved through regulation’. However as this is non-devolved area, it will have to engage with the UK Government to explore this option. The Welsh Government also highlighted that it will put the 5G CAV test centre idea to the expert advisory group it has commissioned to ‘prepare and shape a coherent national 5G programme’ for Wales.
The Future of skills
In general, the Committee heard that while there will likely be new, and potentially better paid, jobs created as a result of automation, those least able to respond to labour market changes will be most affected initially. In its evidence to the Committee (PDF 155kb), the Welsh Government noted that it:
is working on the assumption that jobs will be transformed, not eliminated by developments in automation.
All witnesses agreed that there will be ‘a need for a workforce skills refresh’ in response to expected labour market changes. However, some witnesses felt that “we are nowhere near prepared” for retraining and redirecting the people likely to be affected by automation. As a result, the Committee made four recommendations to the Welsh Government in regards to preparing workers for the future, all of which the Welsh Government accepted.
The Committee felt there was a need for the Welsh Government to refocus and redevelop its support for lifelong learning in order to better support workers at risk of displacement by automation. The Welsh Government suggests that its proposed Personal Learning Account scheme, as outlined in its Employability Plan, will support workers to retrain. However this scheme is not due to be piloted until at least April 2019, and it appears dependent on a successful application to the European Transition Fund.
Ensuring that the education workforce is ready and able to incorporate digital tools into learning so that the next generation can thrive in a new digital world was another key recommendation. In response, the Welsh Government highlighted that it is developing a Digital Professional Learning Framework as part of its new National Professional Learning Model for teachers in Wales.
The report also called for a new a scheme to fund further Post-Doctoral learning in automation and Artificial Intelligence (AI) related fields to attract and retain those skills in Wales. The Welsh Government noted its Ser Cymru programme, through which a number of AI fellows have been supported. It indicated that a more targeted scheme ‘is currently being considered’.
Finally, given that only one of the three Regional Skills Partnerships (RSPs) identified automation as an issue in their 2017 annual skills plan, the Committee recommended they should ‘review their plans for future requirements’. The Welsh Government highlighted that as a result of the Committee’s scrutiny it has written to the RSPs asking them to ‘give consideration to digital innovation in this year’s annual reports’.
Areas for further exploration
Alongside the recommendations it reached, the Committee found that the evidence raised further questions for ‘all of us with an interest in Wales’ economic prosperity’ around how:
- to strike the right balance between innovation and regulation?
- to ensure that Industry 4.0 presents an opportunity to reduce, rather than increase, inequality?
- to encourage people to take up active travel, if door-to-door transport in CAVs becomes the ‘easy’ option?
- lifelong learning can be re-imagined to meet the changing demands of Industry 4.0?
The Committee hopes that its report will stimulate wider discussion across Wales around these points so that Wales will be ready to harness the changes of the Forth Industrial Revolution.
Article by Joseph Champion, National Assembly for Wales Research Service