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Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)
It is a great privilege to speak in this debate, and I am even more pleased that I am not speaking and advancing my case alone. I am enormously grateful for the support of my hon. Friend the Member for Birmingham, Perry Barr (Mr Mahmood), and my neighbour in Birmingham, my hon. Friend the Member for Birmingham, Erdington (Jack Dromey). I am glad that hopefully, a bit later this morning, we will be joined by the right hon. Member for Sutton Coldfield (Mr Mitchell), and with your permission, Mr Robertson, I also have a few short remarks to make for the hon. Member for Solihull (Lorely Burt), who is recovering from surgery but very much wanted to be here to support the case that I will put to the Minister.
Together, we are a powerful team, and the argument that we want to advance is that all of us are great supporters of High Speed 2. We believe that High Speed 2 could be of huge importance to our country and to our home city of Birmingham, and it is particularly appropriate that the birthplace of the steam engine, Birmingham, is the first place that High Speed 2 will connect to London.
I have been a supporter of High Speed 2 ever since Lord Adonis first presented the plans to Cabinet in around 2009 or 2010. He made his case not only with his customary force and clarity, but with a very keen sense of history; in that first presentation to Cabinet, he reminded us that it was not a new idea, but that it had been around for some time. In fact, I think it was Churchill who anticipated the need for extra capacity and high speed after the second world war, as part of our country’s plans for reconstruction. We have been waiting ever since for concrete plans to be put on the table.
When I was Chief Secretary to the Treasury in 2010, negotiating spending reductions across Government, it was particularly impressive that Lord Adonis at the Department for Transport was prepared to make the trade-offs necessary in the DFT budget to present a plan that was not simply a bit of blue-sky thinking, but had an enormous amount of detail behind it and a financial package to go with it. He had thought an awful lot of things through that would be needed to turn ideas into reality. At that stage, however, he was obviously operating at 20,000 feet, so to speak. It was impossible back then to foresee and anticipate every design detail that would be needed in the final plans.
At that stage, no doubt, some imperfect decisions crept into the blueprints. I say that not to criticise, but simply to understand. We are dealing with HS2 Ltd, not with an organisation that has been designed according to some celestial blueprint. It is a human institution, and in all human institutions—even those appended to the Department for Transport—sometimes imperfections creep in. A big imperfection and a big mistake has crept into these plans. That big mistake is the notion that we should destroy a third of the industrial land in the great city of Birmingham and put a marshalling yard on it, just to create a few hundred jobs in a decade’s time at the cost of creating 7,000 jobs in the short term.
With your permission, Mr Robertson, I would like to acquaint the Chamber with a bit of the site’s history. I want to set out its economic potential and then conclude by putting some questions to the Minister. He is a good Minister who knows and is on top of his brief. He understands the background to this debate, and I know that he will provide us with full answers this morning.
The site that we are talking about—a third of the industrial land in the city of Birmingham—is old. It was brought into industrial use as the country passed through the high noon of the Victorian age, towards the end of the 19th century. One of the greatest entrepreneurs in Birmingham’s history, the great Joseph Wright, created what was then called the Metropolitan locomotive works on an enormous site. Over the course of 10 or 20 years, a huge industry was built up, manufacturing locomotives that were shipped all the way around the world. In the 1880s and 1890s, Britain began sending billions of pounds around the world to build the world’s railway systems; many of the locomotives that ran on the new railway tracks in India and other parts of the empire were, as often as not, built in Joseph Wright’s great Metropolitan coachworks.
As the years went by, Joseph Wright was joined by the second great entrepreneur of east Birmingham, Herbert Austin, who founded Morris cars, and who, in the early part of the 20th century, built up the great Nuffield Organisation. In due course, he built the site that was to become the great LDV site next door to the Metropolitan coachworks. At its peak in the 1920s, 4,000 manufacturing workers were employed on the site.
Around that great site in east Birmingham, the last great entrepreneur of east Birmingham—not an industrial entrepreneur, but a civic entrepreneur—C.B. Adderley, the late Lord Norton, laid out the streets of Saltley, and that is the community that we are talking about today. The de-industrialisation of the ’80s and ’90s hit our community very hard. First, what had become Metro Cammell closed down. Then, sadly, despite our best efforts and despite the offer of support at the time from my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown), LDV finally went into liquidation around the time of the last election. What emerged was a great wasteland in east Birmingham, and partly as a result of the de-industrialisation, in east Birmingham—in my constituency of Hodge Hill, in the constituency of my neighbour, my hon. Friend the Member for Birmingham, Ladywood (Shabana Mahmood), and I am afraid to say, to an extent in Erdington—we have very high and unacceptable levels of unemployment. Indeed, 45% of those who are out of work in the great city of Birmingham are in Ladywood, Hodge Hill and Erdington. There are 10 constituencies in our city, and 45% of the city’s unemployed are in just three of them.
With the liquidation of LDV and the ill-judged liquidation of Advantage West Midlands after the 2010 election, something different became possible. For the first time in literally 100 years, it was possible to stitch back together a site that is the size of 105 football pitches. It is the greatest single site pretty much anywhere in the west midlands. Crucially, it became possible to develop the site holistically and put in place new access routes that were impossible in the past.
In the early part of our discussions with HS2 Ltd, we listened with increasing irritation to the idea that just because one owner of part of the site—St Modwen, which owned the western part of the site—had had planning permission, but was unable to get the site developed, somehow the site was not developable. I hope that that argument does not feature in the Minister’s remarks today. If those pages are in his speech, I hope he rips them out, screws them up and puts them on the floor. They are irrelevant to the argument.
Only when the site came together for the first time in a century was it possible to put through the site access routes from the east and to the north of the site. St Modwen’s site on its own, on the west end of this great industrial land, has only the narrowest of roads connecting it to the outside world, and it goes through a number of residential seats. It is the worst possible access imaginable to an industrial site. In putting this great jigsaw puzzle back together, the possibility is opening of putting big new roads in, leading straight on to the M6, if we so choose. It becomes, for the first time, not just a site where new access roads are possible, but where those access roads could connect to the great backbone of the M6.
I was of course immediately taken with the potential of developing the site holistically for the first time in a century, so in 2011 and 2012 I asked the master planners at Birmingham city council to give us a sense of the jobs potential of creating an holistic plan for developing a site the size of 105 football pitches. I was pretty shocked by the answer that I got: having done some detailed work, they told us that between 5,000 and 7,000 jobs could be created on the site if it was developed holistically, with new access routes to the north and the east. A site with that power, with that number of jobs, would of course not only have an enormous impact on unemployment in the east of the city, but bring into the coffers of Birmingham city council £5 million in new business rates every year.
However, the last Conservative-Liberal administration in the city appears to have overlooked a great jewel, and to have not made sufficiently robust arguments to HS2 about a different way forward. This is a great prize for any city, and particularly for us in east Birmingham, because of the high unemployment with which we are cursed. The Library tells us that in the constituency of my hon. Friend the Member for Birmingham, Erdington, 3,917 people are on jobseeker’s allowance. In Ladywood, 7,363 people are out of work. In my constituency, the figure is 5,379. There are 16,500 people claiming jobseeker’s allowance in our three constituencies; that is out of a city total of just over 37,000, so 44% of those on jobseeker’s allowance live in our three constituencies—the constituencies that surround this great industrial space. For those who are interested, the bill that the taxpayer picks up for those unemployed citizens—our residents—is £73.8 million a year. If we developed the site to its full potential, as set out by the master planners at Birmingham city council, we could halve that bill. We could save the taxpayer £35 million of unemployment benefit if we put jobs, not sheds, on the site. That is why we have been making this argument for the past couple of years.
I know that High Speed 2 needs a marshalling yard. We are supporters of High Speed 2 and we want it to be a success. We want it to happen fast. We very much welcome the work that David Higgins has done to take cost out of the equation. However, we must think more laterally about where the alternative sites might be. The Minister knows as well as I do that alternative sites are available. During the past two or three years, we have heard an increasingly dull account of why it was not possible to develop those sites as a marshalling yard. What we get is references to “operational issues”, but no one—not the Minister’s predecessor, not the Secretary of State and not David Higgins, the head of HS2—has been able to tell me in any detail what on earth those operational issues are. I have yet to see one analysis that brings together any extra cost of putting a marshalling yard elsewhere, netted against the value of the opportunity that we know exists. That includes the savings on the dole bill, the increases in business rates and some of the other economic advantages that we know we could secure. No one has been able to give me that sum, so in a way I am here to speak for taxpayers, and to say that taxpayers are funding High Speed 2, the unemployment bills and the shortfalls in Birmingham city council’s budget. We want to know holistically how these sums add up.
The Minister is a Transport Minister who speaks for the Department for Transport. I know from my experience in Whitehall that sometimes Whitehall fails to join things up, but in a decision of this economic consequence, what the taxpayer is owed is one sum that brings together on one piece of paper the cost to the Department for Work and Pensions, Birmingham city council, the Department for Transport and HS2. We need to have that sum. I am not saying that the Minister should lay it out for us this morning, but I know that he will want to write to me after the debate with those calculations, because I know that, like me, he wants taxpayers to know the full facts and the full truth.
Unless the plans change, we are confronting the most grim of scenarios, because we are set to lose not only the great prizes that I think are there for the taking, but hundreds of job in the short term. As the Minister knows, the site is not completely empty. It is home to the great Business Post, to Cemex, which makes most of the railway sleepers that our country needs, and to other great businesses, such as Taroni’s. In fact, by my calculations, there are some 850 jobs on the site today, but those businesses are closing. They are increasingly frustrated and they are haggling and arguing with a normally non-communicative HS2, because they now have to close down, so we will lose 850 jobs in the worst unemployment hot spot in the country during the next couple of years. Why? For the prize of perhaps 500 or 550 jobs in 10 years’ time. The scenario that we are confronting could not be worse. The Minister will forgive me for saying that this is a thoroughly misguided decision. It would be a misguided decision anywhere, but in the worst unemployment hot spot in the entire United Kingdom, the decision should not be taken lightly.
As I said, the hon. Member for Solihull would very much have liked to have been here this morning, but is recovering from surgery. She would, in the ceremonial nature of these things, congratulate us on having the debate. She says that High Speed 2
“is founded on the fundamental principles of regeneration and enhancing the economic prospects of the UK and specifically those communities located near to the lines and terminals.
The irony therefore is not lost on me or indeed other colleagues from across all the main parties…when one considers the social and economic desecration that siting a Rolling Stock Maintenance Depot at Washwood Heath would have on that local community.
As someone who is a supporter of HS2 and in particular has taken a keen interest”
in the decision to locate the depot at Washwood Heath,
“I very much welcome the chance to debate this issue, an issue which for too long has been left unresolved.”
Like me, the hon. Lady draws attention to the very high unemployment levels in the area. They are double the national average. Youth unemployment in my constituency is the highest in the country. I very much welcome the support that she is giving as part of a cross-party alliance of Birmingham MPs calling on HS2 and the Government to think again, and to do so quickly.
I want to conclude with some thoughts on what the Minister should do next. I would obviously like the yard to be moved elsewhere. If the decision is taken not to move it elsewhere, I would like the Minister to show me, in pounds and pence, how the deal makes sense. I want him to take into account the opportunity cost—the potential for a reduction in the dole bills in east Birmingham, and the potential for extra business rates to flow into the coffers of Birmingham city council.
If HS2 is not prepared to budge, and we are not prepared to adopt plan B for the site, I want to see big ambition for jobs growth in east Birmingham. I do not want vague promises that “We will do our best.” I want a number. I want to know what the Department for Transport’s ambition is, to the nearest hundred, for the number of jobs that will be created in east Birmingham, and I want to know when HS2 and the Department for Transport want to see those jobs go on offer. I want local labour market agreements to go alongside any new plans to develop the Curzon street terminus in east Birmingham. I want to know what promises will be made and fulfilled for extra skills and training.
The point is really very simple: High Speed 2 should be a big positive for our city. It brings with it the promise of thousands of extra jobs across the west midlands and gives us vital capacity, but there is now a cross-party alliance of Members of Parliament saying to the Minister that we do not want High Speed 2 to be good for just some; we demand that it be good for all.
Jack Dromey (Birmingham, Erdington) (Lab)
It is a pleasure to serve under your chairmanship, Mr Robertson.
I would like to start by telling the tale of two great plants. The first is the Jaguar Land Rover plant. When I was elected in 2010, the Jaguar plant in Erdington was on its way to closure. I remember meeting the management and shop stewards before the general election, and there was a funereal atmosphere. After I was elected, my first priority was to work with the Government, the new management brought in by Tata, the work force and a range of other players to put together the complex jigsaw that led to the historic decision by Tata in October 2010 to invest £5 billion. I will never forget that day. We stood outside the Jaguar heritage centre in Erdington, and I said that a plant with such a great history—it manufactured the Spitfire during the war and two generations of Jaguars afterwards—was now safe for the next generation. A factory with a great history had a great future.
Secondly, as deputy general secretary of the old Transport and General Workers’ Union, I was involved in a successful campaign to win an order for LDV that helped to keep the factory going. Tragically, as my right hon. Friend the Member for Birmingham, Hodge Hill (Mr Byrne) said, LDV ultimately closed in 2009—a particular factor was that it did not succeed in securing a key order. LDV also had a remarkable history of motor manufacturing: the bodies for the Morris Minor were first produced there in 1948, and Morris commercial vans commenced production in 1974. It was a tragedy that a second factory with a great history ended up with no future.
Why do I paint that background? Because High Speed 2 impacted on both factories. In the case of Jaguar Land Rover, bizarrely, it was proposed that the High Speed 2 route would take out the Jaguar rail terminal. However, constructive discussions with the Government and the Secretary of State followed, involving my right hon. Friend the Member for Birmingham, Hodge Hill and the hon. Member for Solihull (Lorely Burt), who cannot be here today. The outcome of those discussions was the welcome decision to re-route the High Speed 2 line to avoid taking out the Jaguar terminal.
In the case of LDV—sadly now history—I will do my best to describe the bizarre proposal as it affects Washwood Heath. I remember meeting an LDV worker in Kingstanding in 2010—I met a lot of them, as many live in my constituency. He had lost his job early in 2009 and subsequently been out of work. He was absolutely devastated; he was a skilled man who worked for LDV for 25 years. I stayed in touch with him and met him only last month. He had managed to get back into secure employment. He and one of his LDV mates—an old friend—both said the same thing to me: they asked with incredulity, “Why put a maintenance depot on the old site where we worked for so many years when it is perfectly possible for the depot to be put elsewhere? Why not develop that great site, as we understand the council is proposing, for commercial and manufacturing use?” They kept asking, “Why Washwood Heath?” One of them went on, “Not least because, Jack, we need the jobs here locally. Where I live in Kingstanding, one in four young people are out of work. We desperately need those jobs. I would like to see that site, where I went to work for so many years and that generated thousands of jobs when I worked at LDV, generating thousands of jobs again.” He is absolutely right: we do need the jobs, which are at the heart of Birmingham’s ambitious plan for economic growth. Because of the excellent work that has been done by right hon. Friend the Member for Birmingham, Hodge Hill, in alliance with a number of potential developers and sources of finance, we are talking about not just jobs on that site but good jobs—high-quality jobs.
I would like to draw a parallel with Jaguar Land Rover. I was in the Jaguar plant last Friday. It has an excellent programme to train young people, providing a ladder into apprenticeships and giving hope to the young unemployed in my constituency. That is exactly the kind of hope and opportunity that we would like to create by making sensible use of the Washwood Heath site.
Like my right hon. Friend I am a strong supporter of High Speed 2. At the heart of the argument for that project is the contribution it will make to the growth of our country as a whole. Britain cannot succeed through London and the south-east alone. There is cross-party support for High Speed 2, so there is no question about the principle; it is a grand, ambitious project that should go ahead. Nevertheless, would it not be bizarre if something designed to develop and create jobs actually causes the sacking of workers currently in a job and the denial of opportunities on a grand scale—potentially 5,000 to 7,000 jobs at the next stage?
I live in the real world and know that the issue is not without difficulties, but where there is a will, there is a way. I hope that, just as they engaged constructively with local MPs on re-routing the line in the best interests of Jaguar Land Rover, the Government will engage constructively with MPs to see the marshalling terminal developed elsewhere and the site used in the way that our city so desperately needs.
Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)
It is a great privilege to serve under your chairmanship, Mr Robertson.
I welcome the fact that my right hon. Friend the Member for Birmingham, Hodge Hill (Mr Byrne) has secured this debate on an issue that is important to his constituency and the neighbouring constituencies of Birmingham, Erdington, Birmingham, Ladywood and my own constituency, Birmingham, Perry Barr—it is important across Birmingham. Birmingham has a huge history of engineering and manufacturing, as my right hon. Friend pointed out. It is a great place, and Washwood Heath is the perfect site to house what he proposes, rather than the HS2 marshalling yard.
My right hon. Friend was right to say that all the Opposition Members present have been great supporters of HS2. I had the great privilege to serve with my hon. Friend the Member for Nottingham South (Lilian Greenwood) on the High Speed Rail (Preparation) Bill, which was a step forward in securing the high-speed line. We believe it is important to secure that because it will create a new transport mechanism for the whole country. More importantly, it will allow us to create valuable jobs.
Like nowhere else, Birmingham has facilities available, and we are prepared. We have engineering capability in our city. In my constituency, we have an advanced manufacturing zone that currently supports a lot of the great work being done in the constituency of my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) by supplying Jaguar Land Rover. We want to see more people there because that would allow us to build more capacity to support the services that my right hon. Friend the Member for Birmingham, Hodge Hill mentioned. If a broad base were already set up, it would make that much easier. Birmingham would be far more advanced than any other city. That is why it is important that we do this.
I agree with my right hon. Friend that we need local job agreements, as such agreements are important to our constituents. As a nation, we are providing a huge infrastructure and, ultimately, our constituents and the people of this country should benefit more than anyone else. Most other places have such agreements, and we should seek to deal with that issue in our discussions on the European Union stipulations. It is important that we do that to move forward.
Just to prove a point about what we do in Birmingham, Perry Barr, I was hugely privileged earlier this year when we got a brand-new Engineering Employers Federation training facility, which the EEF paid for itself—the EEF received no grants for that at all. It is a fantastic new training centre off Holford drive in my constituency, and it regularly takes on more than 300 new trainees from companies that still serve our great city and the region. They are trained on a 34-week programme in proper engineering facilities. We need to get back to the days when we had proper manufacturing machinery: computer numerically controlled lathes and millers, normal milling machines, welding equipment and all those things that we tend to forget and walk past. They are the tools that provide engineering skills and capability. It is important for us to consider the way in which engineering has built Birmingham, and we need to get back to that.
Huge improvements have been made by Jaguar Land Rover. When it was said that we could not carry on with manufacturing, it was a complete fallacy, as has been proved by the new management at Jaguar Land Rover. Birmingham and the people of Birmingham can do it, as has been proved time and again. We have facilities and further education institutions in the city. We have South and City college, which serves both my constituency and the constituency of my right hon. Friend the Member for Birmingham, Hodge Hill. Indeed, he also has a construction centre operated by South and City college in his constituency. I am sure that the college will be able to step up to the plate and provide more national vocational qualification level 3 training facilities, which are hugely needed.
We have facilities that will enable us to move forward and provide the support that an engineering base needs in Birmingham. We have done that, and Birmingham is far ahead of any other city. As my right hon. Friend said, it is important that we create jobs in Birmingham. It has been forgotten for too long nationally. Other cities have prospered that, with all due respect, do not have the facilities and skills that Birmingham has had traditionally. I can declare that because I trained at Delta Metals when I was a lot younger than I am now. I went through an apprenticeship, and it was a great place for manufacturing and engineering, which allowed me to progress.
It is important that we encourage the entrepreneurs of the future. As my colleagues have said, entrepreneurs such as James Watt developed the engineering skills that allowed this country, and at that time the empire, to move forward. If we are to move forward as a nation, we need to get back to the principles of making things that add value. Engineering and manufacturing do that, and we certainly have those capabilities. Birmingham has—excuse the pun—a huge track record of delivering engineering, and I support my right hon. Friend.
Lilian Greenwood (Nottingham South) (Lab)
It is always a pleasure to serve under your chairmanship, Mr Robertson. I congratulate my right hon. Friend the Member for Birmingham, Hodge Hill (Mr Byrne) on securing this important and timely debate. He has consistently drawn attention to the impact that the proposed maintenance depot could have on his constituency and on Birmingham as a whole, and he has presented a powerful case this morning, ably supported by my hon. Friends the Members for Birmingham, Erdington (Jack Dromey) and for Birmingham, Perry Barr (Mr Mahmood).
Today’s debate is especially well timed because Birmingham city council and Centro will be the first organisations to have their petitions heard by the Select Committee on the High Speed Rail (London – West Midlands) Bill. I am sure that, as a consequence, many interested parties will be following this morning’s proceedings with even closer attention than usual. I take this opportunity to congratulate Birmingham, along with Derby, Manchester and Doncaster, on reaching the shortlist for hosting the proposed high-speed rail further education college. All my hon. Friends, particularly my hon. Friend the Member for Birmingham, Perry Barr, talked about Birmingham’s track record, and the things that will allow it to make a strong case as the competition proceeds.
My right hon. Friend the Member for Birmingham, Hodge Hill, made it clear in his opening speech that he is a strong supporter of High Speed 2, and I am grateful for his powerful contributions on Second Reading of the hybrid Bill and in the Adjournment debate he secured last January. He is entirely right to make the case for the project while seeking the best possible outcomes for his constituency and for Birmingham, but I will say a few words about the benefits that HS2 will bring not only to that city but to the wider west midlands before returning to the specific issues of Washwood Heath.
Birmingham’s economic health is closely tied to the operational health of the west coast main line, which is a vital economic artery for the region. As hon. Members for the west midlands know all too well, the west coast main line is also where our capacity constraints are most acutely felt. Passenger numbers have doubled over the past 20 years, placing enormous demands on our infrastructure. The railways are carrying the same number of passengers as they did in the 1920s on a network less than half the size, and the west coast main line is now the busiest passenger and freight rail line in Europe. Network Rail has warned that by 2024 the line will “effectively be full.” As record passenger growth continues, the day of reckoning may arrive sooner.
Annual passenger growth has averaged 5% over the past decade, but the Office of Rail Regulation recently confirmed that passenger numbers grew by 5.7% last year. The reality of those numbers is borne out by the thousands of commuters who are left standing every day as their trains approach Birmingham and other cities. The difficulty of running more commuter trains over mixed-use tracks, on which they have to compete with freight and fast inter-city services for paths, is well understood. By contrast, the process whereby local trains are squeezed off the network completely has not been well reported, but its effects are already being felt in the west midlands.
Geoff Inskip, the chief executive of Centro, told MPs last year that after the £9 billion west coast modernisation project some communities actually received a worse service than before:
“If we look back at the timetable changes that took place in December 2008, we put in more services to London, but those were at the expense of local services. Therefore we had worsening of service frequencies at local stations and loss of direct local services between, for example, the black country and Birmingham airport and Coventry.”––[Official Report, High Speed Rail (Preparation) Public Bill Committee, 9 July 2013; c. 18, Q32.]
Looking at those changes in detail, we see that Walsall lost its half-hourly service to Birmingham International airport. Both Walsall and Cannock lost their direct trains to the north beyond Rugeley Trent Valley, and there was a worsening of journey times on the line from Birmingham to Northampton.
I recently visited Barlaston station on the west coast main line and saw for myself what the consequences will be if that process is followed through to its logical extreme. A passenger train last stopped at Barlaston, just south of Stoke-on-Trent, in 2003. Services were suspended to allow work on the west coast modernisation project, and they have remained suspended ever since, in part because its paths have been reassigned to enable more inter-city trains.
Nearby Stone managed to reopen its station in 2008, and it has seen a dramatic increase in usage, but following a recent change in timetables, a journey from Barlaston to Stoke on the official bus replacement service takes around an hour, whereas the same trip would have taken five minutes by train. That is a particularly stark example of the effect that the capacity crunch is having on the network, and it can also be seen in Birmingham. Attempts to reopen the Camp Hill line, which served important communities in the south of the city, such as Moseley and Kings Heath, have been repeatedly frustrated by the lack of spare capacity at New Street station.
As the pressures on the network grow, we need action to prevent local services and freight trains from being squeezed off the network completely. Given the experience of the west coast modernisation project, which cost the taxpayer at least £9 billion and 10 years of disruption, a high-speed line is the best solution. The clear message is that there is a real need for more capacity on our railways, both to allow grade separation of traffic and to accommodate growing demand for inter-city, commuter and freight services.
We also need to plan ahead to make sure that our cities maximise the benefits that HS2 will bring. When I visited Birmingham in March, I was struck, as I think anyone would be, by the scale and vision of its plans for regenerating the Eastside area and integrating the Curzon Street station with local public transport. I hope that through the petitioning process a stronger consensus will be achieved between the city council, Centro, and HS2 Ltd on the best way to achieve those aims.
The petitions of Birmingham city council, the national exhibition centre, Centro and Birmingham airport all make it clear that they strongly support the principle of building HS2, but they are, understandably, seeking changes that they believe will maximise those local benefits, as my hon. Friends have done today. I do not propose to go through all the modifications that they are seeking, although I take some pride in the fact that it was Opposition Front Benchers who secured an assurance from the Government—from the Minister—that the Select Committee would be able to hear petitions related to passive provision for a future link to HS1, something that I know the city has been concerned about.
The council seeks changes for the Washwood Heath site. It is vital that it receives a fair hearing when it gives evidence to the Bill Committee. Specifically, it is asking: for a minimised land take for the depot; for provision for training and skills development; and for the HS2 network’s control centre to be based at the site. My right hon. Friend the Member for Birmingham, Hodge Hill, has previously said that Washwood Heath represents a third of all brownfield land that is suitable for industrial development in Birmingham. Unemployment is clearly a serious problem in the surrounding area. As the former site of the LDV works and those of Metro Cammell—later Alstom—the land has a proud manufacturing history, so the comments of my hon. Friend the Member for Birmingham, Erdington, about the need for not only jobs, but good, high-quality jobs, are absolutely understood.
The site has been cleared for redevelopment, so it makes sense to minimise the land that HS2 will require as far as is reasonably practical, and to reach an early decision on the overall footprint of the proposed train maintenance depot. Of course, it is an important principle that the Select Committee should be able to govern its own affairs, and we should not seek to prejudice its decisions, but I am sure that the promoter, HS2 Ltd, has taken a careful note of the arguments put forward this morning.
My right hon. Friend the Member for Birmingham, Hodge Hill, said that regeneration and economic development are an essential part of the HS2 project, and he rightly calls for clarity on job creation and training opportunities. Presumably, this is a matter that can be explored in more depth through the Government’s long-awaited jobs and skills strategy. When I last asked the Minister about the report’s progress, he said:
“We expect it to be set out in more detail in the latter part of 2014.”—[Official Report, 26 February 2014; Vol. 576, c. 388W.]
That was in February. Can the Minister confirm today that the report is still on course to be produced in 2014, and is he able to give a more precise date for its publication?
I would also like to ask a question about the network control centre. When my right hon. Friend the Member for Birmingham, Hodge Hill, secured a debate on this matter in 2013, the then Transport Minister, the hon. Member for Lewes (Norman Baker), said:
“There is also the potential to locate the HS2 control centre at Washwood Heath, generating a further 100 jobs.”—[Official Report, 25 January 2013; Vol. 557, c. 644.]
Indeed, that is one of the requests that Birmingham city council made in its petition, but HS2 Ltd’s rolling stock depot and stabling strategy, which was published in April, stated:
“The HS2 network control centre will also be located on the Washwood Heath site.”
Will the Minister confirm that the matter has now been settled? Does he have confidence in the figure of 650 jobs being directly created at the site, and what estimate has he made of the indirect job creation, both when the line is built and in the run-up? My right hon. Friend the Member for Birmingham, Hodge Hill, rightly asked for ambition and certainty, and I hope that the Minister will respond positively today.
HS2 will bring great benefits to Birmingham. It will place the city at the physical and operational heart of the national high-speed network; it will create and support thousands of jobs and provide new links to our country’s great cities. As a Nottingham MP, I know how poor those links can be, and that HS2 would revolutionise the connections between the east and west midlands.
Labour supports HS2, but, given the scale of public investment involved, it is essential that value for money is maintained, and that the petitioning process looks at the specific objections that have been made and at the arguments put forward today. I thank my right hon. Friend the Member for Birmingham, Hodge Hill, who has brought these issues to national attention, and I look forward to the Minister addressing the questions that have been raised.
The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill)
I congratulate the right hon. Member for Birmingham, Hodge Hill (Mr Byrne) on securing this debate on the location of the HS2 rolling stock maintenance depot at Washwood Heath. There is no doubt he speaks with genuine passion and conviction on behalf of his constituents. I know how important the area is for jobs and regeneration in his constituency. I hope that he will accept that we closely share his interest in maximising the benefits that the site can deliver. I also understand the history and heritage of the site. Indeed, I suspect he might wish me to point out that locomotives were also built in Glasgow, as well as in the north-east and Leeds. This country has a great engineering heritage. Of course, it has been the home of many great vehicles over the years, culminating in the Leyland Sherpa. Many will remember the LDV vehicles.
Before I go into the proposed use of the site for HS2 and what is being done to maximise the economic benefits for that area, I want to say again how important the Government believe HS2 is for the country. I appreciate the points made by the hon. Member for Nottingham South (Lilian Greenwood). The two main parties share the view that HS2 is important.
HS2 is a crucial part of our plans to develop the right infrastructure for future economic growth. HS2 will create 24,600 jobs during construction and maintenance, support 100,000 jobs around stations and depots, and create up to 2,000 opportunities for apprentices. In fact, some external estimates are even higher, with some predicting that HS2 will underpin the delivery of 400,000 jobs, and 70% of jobs supported by HS2 are expected to be outside London. I am sure the right hon. Member for Birmingham, Hodge Hill will agree that, while benefiting the whole country, HS2 offers significant opportunities for those in the west midlands area and in his constituency.
The new terminus station at Curzon Street, the interchange station near Birmingham airport, and the west coast main line will put Birmingham and Solihull at the centre of the country’s transport infrastructure, creating huge opportunities for growth in the area. The Curzon Street station will be a catalyst for the development of the Eastside area of the city and offers real regeneration potential for the Digbeth area. The interchange station will act as a focus for the economic development plans of local authorities and the area’s local enterprise partnership. HS2 will bring construction jobs and operational jobs when the line is open. It will support wider jobs and wealth creation, improving the prospects for businesses and people across the west midlands.
HS2 could help to support growth in employment of more than 8,000 jobs in the regeneration and development areas around the Birmingham stations. Centro estimates that the figure will be closer to 10,000 jobs, with as many as 22,000 jobs created in the wider region once phase 2 is completed and economic output is increasing by £1.5 billion.
The right hon. Gentleman’s constituency will also benefit. The Washwood Heath rolling stock maintenance depot will itself create employment in this area; approximately 640 jobs will be created and I am pleased to confirm that figure. These jobs are not dependent on the realisation of commercial opportunities or other redevelopment of the site. They are real jobs linked to a funded scheme that has the backing of Parliament. Bringing the depot to this site, which has an historical association with the railway, will kick-start the wider regeneration of the area.
The right hon. Gentleman raised questions in relation to the selection of the site for the rolling stock maintenance depot. I reassure him that a vigorous process for the identification of the site has been undertaken. A number of technical requirements informed much of the site selection process. Additionally, the key factors influencing the site selection process included location, size, access to the HS2 network and sustainability. The initial assessment concluded that a west midlands location was more appropriate than a site in the London area.
Mr Byrne
I am grateful to the Minister for giving way with characteristic generosity. He outlined the criteria that were used to conclude that Washwood Heath was the right site. I know that he cares about the interests of the taxpayer, as I do. I could not help but notice that he did not include on that list any assessment of the extra business rates that could be developed and delivered through alternative use of this site, and he did not flag up any savings to the unemployment bill, although savings of £74 million a year could be achieved through alternative development of the site. Therefore, I am concerned, as I know he will be, that there should be a holistic, whole-of-Government, whole-of-taxpayer analysis of whether the site is the right one and not simply an analysis based on the narrow and particular concerns of HS2 Ltd. If he is not able to bring forward such a whole-of-Government assessment of costs today, will he undertake to do so in due course?
Mr Goodwill
The right hon. Gentleman makes an important point. However, looking at the wider economic area of the west midlands, there have been tremendous opportunities for investment. Jaguar Land Rover is building an engine plant and there are other big investments coming in. As the hon. Member for Birmingham, Perry Barr (Mr Mahmood), said, we have finally got it and understood that manufacturing jobs and making things in this country for export are very important. That is how, in many ways, we have created jobs in this country. The unemployment figure falls month after month after month, and the number of people claiming benefit falls month after month after month. That is in marked contrast to the record of the previous Government, who seemed to bet the farm on the City of London and jobs in financial services.
Perhaps I can outline to the right hon. Gentleman why we feel this site is the best site, and the operational considerations that were factored into the decision to house the depot at Washwood Heath. Those considerations include the need for trains to slow down as they approach the depot, which means it is operationally better for the depot to be on a slow section of the route. Washwood Heath is also close to Curzon Street station, where trains will start their journey. If the depot were located on a section of the route where trains do not start their journey, the train running costs would be increased.
After the assessment, a long list of potential sites in the west midlands area were identified and evaluated. That resulted in a shortlist of sites and a further evaluation to enable a preferred option—Washwood Heath—to be identified as the most suitable rolling stock depot location.
Washwood Heath was selected as a preferred option because of its proximity to the Curzon Street station; it is situated off the main HS2 line of route; and the site is centrally placed within a future national high-speed network. From a sustainability perspective, the site is not in the green belt. The process is documented in HS2 Ltd’s report entitled, “Rolling Stock Maintenance Depot Selection”, which was prepared in September 2010.
Recognising the right hon. Gentleman’s concerns and those of the landowners at Washwood Heath, which have emerged since the selection process that I have just described, HS2 Ltd updated its assessment, looking at the concerns raised and the alternative sites proposed for the rolling stock maintenance depot. That assessment concluded that Washwood Heath remained the preferred option for the depot, and it was considered by Ministers in May 2013. That conclusion was largely due to the fact that Washwood Heath is operationally better than the other sites that were considered.
The remaining question is how best to utilise the residual land at Washwood Heath that will not be required for the depot, to deliver the benefits to the local area that the right hon. Gentleman rightly seeks for his constituency. Once the railway is constructed, approximately 16 hectares—that is 40 acres in English—of land will be available for development purposes, and HS2 Ltd is continuing to work with Birmingham city council to maximise both the amount of residual land and the employment opportunities that can be brought to the area.
Through the west midlands HS2 strategic board and its jobs and skills working group, HS2 Ltd is working closely with both Birmingham city council and a broader group of stakeholders to maximise the employment and skills opportunities that HS2 will create. That process includes the development of an HS2 jobs and skills charter, and an HS2 jobs and skills master plan. We have already heard that Birmingham is on the shortlist of four locations for the HS2 skills academy, the further education college that will be very important in delivering the skills training required to ensure that British people have the skills to take the jobs that become available through the HS2 project.
During the construction of HS2, the nominated undertaker will ensure, in so far as it is lawful to do so, equality of opportunity to encourage the recruitment of local, disadvantaged or under-represented groups. That is in accordance with the HS2 sustainability policy, which states that contractors will work with HS2 Ltd to improve skills, jobs, education and the economy through its investment along the route.
The right hon. Gentleman spoke about the impact on businesses that are based on the Washwood Heath site. UK Mail, formerly Business Post, has its headquarters and national distribution hub on the site, which is why HS2 Ltd and the Department for Transport have successfully agreed a package of advance compensation with the company to allow it to relocate to a purpose-built facility at Ryton in Coventry, which is currently under construction. That site is about 20 miles away from the Washwood site. UK Mail is also proposing to open a north Birmingham hub that is close to the proposed site, which will create approximately 70 jobs.
In addition, HS2 Ltd is in discussions with the other major landowners, including Cemex, regarding their acquisition and relocation, and it has published a business relocation policy that underpins that activity. I should also point out that, if I were in the business of manufacturing concrete sleepers, I would see a very prosperous and successful future ahead, given the unprecedented investment that we have put into the existing rail network as well as into high-speed rail, which is on the horizon. Indeed, we are investing £38 billion to improve the classic rail network.
Mr Byrne
The Minister says that Cemex has a bright future and he was absolutely right to say so. I was therefore highly alarmed to read the letter to me from Cemex, which said that, given the strategic importance of Cemex to the reconstruction of our railway system, the company is incredibly frustrated that no specific detailed plans have come forward from HS2 Ltd to address what is now a pressing need to develop relocation strategies. Cemex also makes the point that securing planning permission for a new site for its business will take about two years; that is how long it takes to get planning permission for that kind of business. Therefore, the prospect of a closure in the short term without clarity about the long term is not only a matter for Cemex and the 300 or 400 people whom it employs but a matter of strategic criticality to the Minister’s plans and ambitions for railway construction.
Mr Goodwill
I absolutely understand the point that the right hon. Gentleman makes and I will ask HS2 Ltd to give me an update on the progress of those negotiations. Obviously, the time scale for building the project is a long one, and I hope that that will allow an opportunity for Cemex and other businesses that are affected up and down the route to be able to ensure continuity of operation and employment.
HS2 Ltd is in active discussions with AXA, Birmingham city council and others, to identify and resolve as many ongoing concerns as is reasonably practical.
Lilian Greenwood
I specifically asked about the jobs and skills strategy, which the Minister mentioned, and when that might be published. He also mentioned the jobs and skills charter and the jobs and skills master plan, which I am not sure that I have seen. Will he say a bit more about those and when they might be in the public domain?
Mr Goodwill
I undertook to publish that information by the end of 2014 and that is still the case, although I am afraid that I cannot give the hon. Lady more detail on the date. However, if HS2 Ltd tells me that that information is available, I will give it to her.
HS2 Ltd has met Cemex a number of times since March 2014, with a view to making progress on relocating the business under the code. The next meeting is on Monday 23 June.
Taxpayer analysis is difficult—the right hon. Gentleman talked about how to weigh up the costs of unemployment and everything else—when based on aspiration about jobs, rather than real jobs on this site, so I am not sure whether we can agree a firm basis or set of assumptions upon which the type of analysis requested could take place. To be fair, assessment would also need to include employment opportunity costs and costs of alternative sites. Just because this site would not be available, say, for an overseas investor, does not mean that investment would not come into the United Kingdom: it could go to a number of possible sites around the country, including in the west midlands.
HS2 Ltd is meeting Birmingham city council and Centro as we speak. I am sure that the issues raised by the right hon. Gentleman, including maximising the regeneration of the residual land, will be on the agenda.
I confirm that the control centre will be based on the Washwood Heath site. The 640 jobs are to be created at the depot and we estimate that between 870 and 1,700 jobs could be created on the residual land.
It is also important that we get the terminology correct, to ensure that we all have a consistent understanding of the plans for the Washwood Heath site. The term “marshalling yard”, which is often used by the right hon. Gentleman, underplays the investment of more than £100 million in this area and the range of entry level, intermediate, technical and professional jobs that that will create.
I am afraid that I need to apologise to the right hon. Gentleman, because I have to reiterate the difference between aspirational plans that could create jobs, and the Government’s detailed plans to create actual jobs on the site.
Mr Byrne
I thank the Minister for giving way to me a third time. I should welcome his views on whether the way through is to agree that, given the opportunity cost of developing the site in the way that he proposes and given the clear risk of economic damage, the jobs and growth plan that he has undertaken to publish by the end of the year should include a defined level of ambition for creating jobs in east Birmingham. That would be the least he could do. As part of that, there should not simply be a plan for the residual land, because as he knows that land does not become available until the 2020s. He will be as concerned as I am with the blueprints, which he will have seen, to put 8 hectares of balancing pond on this land. I love a good lake as much as the Minister, but in east Birmingham we need jobs, not lakes. The great River Tame runs alongside the north of the site, so taking 8 hectares of balancing pond out of the equation would be a good idea.
I hope that, as the Minister develops the jobs and growth plan, we can agree that there should be a defined level of ambition for east Birmingham and we should not simply be talking about the residual land. We should be looking to minimise the land take during the construction period, because, of course, that is the here and now.
Mr Goodwill
I will certainly ask HS2 Ltd whether it needs all the residual land for the construction of the project. Of course, the cost of not having an operationally viable rolling stock maintenance depot is that we will not have a viable project. I have already outlined the benefits to the UK economy in general and the west midlands economy in particular from HS2. Indeed, if HS2 were not to go ahead, hundreds of thousands of jobs would be at risk.
The right hon. Gentleman suggested that 5,000 or 7,000 jobs could be created on the site, but our opinion is that such employment densities are unlikely to be achieved. It is unlikely that manufacturing users would necessarily achieve higher employment densities on the site and, certainly, it is unlikely such densities would be secured for 100% of the site. Our consultants estimate that a figure of 3,700 jobs is more likely.
Mr Goodwill
It is quite a big number. However, warehousing and similar development on sites throughout the country would undercut the level of jobs aspired to.
In response to the right hon. Gentleman’s concerns in relation to Jaguar Land Rover, I confirm that, while the area is safeguarded, there are no plans to take out this yard. I am pleased that Jaguar Land Rover continues to be successful. I have had six of their products over the years and am very proud of Jaguar Land Rover and what it is doing. There is a tunnel in the area where the Jaguar Land Rover freight road is located.
Jack Dromey
The Minister helpfully disclosed the Government’s own assessment of the potential to create 3,700 jobs. Will he confirm that their estimate of what could happen is four times greater than the proposal currently on the table for the marshalling yard, if it goes ahead?
Mr Goodwill
Indeed. We have been absolutely honest about this. The density of employment in the yard, under the proposals, is not as high as the density under high-value engineering or even warehousing or other uses for the site. However, the advantages to the west midlands as a whole from this project will bring jobs to the area. At the moment, month after month, more jobs are being created in the private sector, which have more than compensated for jobs lost in the public sector.
The 6 hectares of balancing pond is critical infrastructure to help manage flood risk in the area. Any development in the land would need to deal with water attenuation. This is not unique to the use of the land as a depot. It is important, from a water management point of view, that something is done about water if large areas of concrete are being laid on the land.
Mr Byrne
The Minister will be familiar with the site, although possibly not as familiar as I am. I am sure that he recognises that the great River Tame runs alongside the north boundary of the site. He will have his work cut out justifying that 6 or 8 hectares of balancing pond are needed to manage the flood risk, when there is a mighty river to the north of the boundary.
I am grateful to the Minister for clarifying the 3,700 figure and for confirming to my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) that that is four times the number that will be created under current plans. I am grateful that the Minister has accepted that the jobs and growth plan could include a defined level of ambition for job creation in east Birmingham. Does he agree that 3,700 is the right ambition that we should be shooting for, as a job-creation target, and will he confirm that when introducing his plans during 2014?
Mr Goodwill
I am slightly nervous to challenge any figures given by a former Chief Secretary to the Treasury, given that his figures were so correct when he was in that role. I should like to make it clear that the aspiration for 3,700 jobs is based on floor-space density. However, the depot itself will create 640 jobs and the residual land will have the potential to create 1,700 jobs. That is 2,340 jobs on the site. Real jobs are being created through this project, not aspirational jobs, which would be great to have, but in some cases could be pie in the sky.
We and HS2 Ltd are working hard not only to implement a scheme that will bring the widest possible benefits to the country as a whole, but to help all those who will be affected. HS2 Ltd is already engaged with those parties who have raised concerns through the petition management process on the rolling stock maintenance depot at Washwood Heath, and we remain committed to working with those parties as we move to the Select Committee process. In that regard, HS2 Ltd’s intention is to continue to work with Birmingham city council and key landowners to enable the rolling stock maintenance depot to co-exist with additional employment uses, thereby maximising the economic benefits of the land. The Government and HS2 Ltd will continue to support the right hon. Gentleman’s aspirations for Washwood Heath, with the rolling stock maintenance depot integral to those plans.