Local Regeneration: Industrial Areas

Baroness Donaghy Excerpts

Thursday 7th March 2024 Lords Chamber

[Baroness Donaghy (Lab)]

I thank my noble friend Lady Armstrong for initiating this debate and for her powerful and moving introduction. My noble friend Lady Chapman referred to listening to her when she was a younger woman and being influenced by her. At the risk of turning this into a sketch by John Cleese, I will say that I canvassed for my noble friend Lady Armstrong’s father, Ernie Armstrong MP, so it is an area that I love very much and am very familiar with. As we are having to establish our regional credentials, I say that my mother’s family comes from Barnsley, and I spent the first 21 years of my life having Christmas there, so it is a town I am extremely fond of—end of John Cleese sketch.

When I think of the wasted years we have lived through—with an absence of government industrial strategy, underinvestment in our transport network and the reduction of local government to virtual serfdom—I could weep. To be fair, one version of this Conservative Government, led by Theresa May and in this House for BEIS by the noble Lord, Lord Henley, did have an industrial strategy. There was support from all sides of the House. However, we woke up one morning and it had been disappeared. Although it was somewhat limited in its scope, it acknowledged the need for co-ordination in support for business, education and skills and local involvement, but it came to nothing.

Indeed, we have witnessed years of so-called levelling up, where a complex maze of funds was created, many with overlapping purposes, and where local and regional authorities were invited to bid for limited amounts and in competition with one another. The Minister, the noble Baroness, Lady Scott, was very frank at the Dispatch Box recently in saying that there was not enough money to support all local authorities, so we endured a giant bingo game, with Michael Gove the chief bingo caller handing out the cash to the lucky winners. Then my imagination started to run away with me, and I was thinking of things like “Clickety-click: new theatre in Clwyd”; “Legs eleven”—well, I will leave the rest to your imagination.

It is calculated that 23 million people live in older industrial areas in Britain—that is one-third of the population. This does not include seaside towns, many of which have similar problems, as outlined in my noble friend Lord Bassam’s excellent committee report on that subject. People suffer multiple forms of disadvantage in those areas, apart from being older on average, lower paid and disabled. The Government take pride in the number of jobs available at the moment, and it is a matter of pride, although I doubt that they had very much to do with it. However, between 2012 and 2019, job growth in older industrial towns was around one-third of the equivalent rate in London—there were 66 jobs for every 100 adults. Commuting to larger towns for work is the norm and sometimes commuting by public transport is not possible. The possession of a car provided access to 28 times more jobs within a 30-minute journey compared with three times in London.

I am a strong supporter of local government, and it is not a perfect system. There will always be a need to moderate between wealthy areas and poor areas to ensure some kind of fairness. Let us be honest: it is how that distribution has been made by successive Governments which determines how really fair the deal might be. We need a return to strong local government, but that requires a step change in funding. It also requires a period of capacity building, given the dire state of affairs in many parts of the country.

The Resolution Foundation and the Centre for Economic Performance produced a report in June 2022 entitled All Over the Place: Perspectives on Local Economic Prosperity. They ran four focus groups in Yorkshire and Humber. The people were from all walks of life, and they talked about their lives in Leeds, Hull, Barnsley and Scarborough. They cared very much about their area but felt strongly that things should get better. In every region of England, more than three-quarters of the population think their area has either trodden water or deteriorated in recent years. The focus groups were aware that their local areas had different routes to prosperity and were alive to the tensions and trade-offs that growth could bring.

All the groups were upset about the degradation of their places and public services—empty shops, unsafe public spaces and weak policing were cited. Although work was readily available, job quality was a pressing concern—low-paid jobs, casual employment, zero-hours contracts, a lack of training and progression, and the sometimes unlawful behaviour of employers.

There is a generation of young people in those areas who do not go into higher education and whose work experience would depress the strongest heart. In the levelling up debates, the Government recognised the criticisms by local government of lack of co-ordination, inefficiencies, complexity of decision-making and reporting burdens. It talked about empowering local decision-makers, local satisfaction and engagement, and a needs-based approach. That is all very good, but it is some time in the future and yet to be delivered. Now the Government are offering a long-term plan for towns. Local government will still need to put in bids and set up town boards, including the local MP, and central government will set up a new towns task force, offering capacity support to town boards. This just sound like the same centralising bidding process—it is just a bigger bingo game.

Yesterday’s Budget covered investment zones, freeports, trailblazer devolution deals and a levelling up fund—even the renovation of local village halls. That is all well and good, but there was no co-ordination to ensure appropriate infrastructure and transport links. It is still a system of handing out the sweeties, along with namechecks for the class favourites—no genuine empowerment.

Finally, the Government have made a big thing about the so-called freeports, to which the noble Baroness from the Green Party referred. A lot more announcements have been made about freeports than actual freeports. I share the scepticism of some commentators about freeports’ potential impact, and I agree with the comment that they are more likely to encourage displacement of economic activity from surrounding areas, rather than increase overall growth. There is no proof that freeports generate high-skilled jobs.

The Office for Budget Responsibility has said that any additional economic activity generated by a freeport would

“probably be difficult to discern even in retrospect”.

It stated that enterprise zone reliefs act more as a reward than an incentive, and that existing infrastructure and transport links are stronger determinants of levels of activity.

In conclusion, the contrast between those with the most opportunities and those with the least opportunities in the UK is shocking and unacceptable. For the Government to start saying some of the right things does not make up for 13 years of not listening, and it is no substitute for a strong and vibrant local government.