Economic Development (North-East)

Debate between Catherine McKinnell and Nicholas Brown

Tuesday 15th February 2011 Commons Chamber

[Mr Brown]

I accept that, and I am making two points—perhaps I have not made them very well. I accept that we are in a different economic climate: times have changed and things have moved on. Although I believe that what we put in place—particularly the administrative structures—was cost-effective, efficient and focused, and delivered well for the region, it would be more rational, even for the Conservative-led coalition Government, to do more to preserve the consensus that we used to have in the region. They could do that by appointing a regional Minister to keep the core functions of a perhaps scaled-down One North East; it could then handle its own residual functions, apart from anything else. We could keep a presence from the major Departments in the region, not embark on the LEPs and keep the private sector engagement that is so important to getting the private sector-led job creation that we all seek for the region, rather than the structures now being put in place.

Therefore, as well as defending what we were able to do when we were the Government, I am also—and separately—making a plea for a much more rational use of what few resources are available under the current regime. I do not agree with scaling them back as far as they have been, but even if I did accept that—I did not intend to embark on the broader quarrel that the right hon. Gentleman tempts me to pursue—I would say that whatever resources are available could be spent in a better, more focused way and bring about better outcomes. That is my key point.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

I, too, commend my right hon. Friend for securing this debate on such an important issue to all us MPs from the north-east. Does he share my concern that, with the swift and fairly draconian—or should that be Maoist?—manner in which the regional development agency has been dismantled, we run the risk of causing a huge dispersal from the north-east of the talent and expertise that has built up there over the years? He gave the example of European regional development funding and the complexities of how such funding is drawn down. We run the risk of losing €139 million that could be invested in the north-east because we have simply dismantled the procedures for drawing down that structural funding without putting anything in their place.

[Mr Brown]

My hon. Friend is absolutely right, but it is worse than that: we also risk losing the talents and the accumulated wisdom of some 245 employees. They have not yet been made redundant, but it is declared that they will be made redundant. All the evidence is that they are not being picked up by the local economic partnerships, which I think is a terrible mistake, but that is the way that things seem to be going. Their talents will be lost within the region as they seek alternative employment as best they can, competing with other people with similar skill sets, or they will be drawn to other parts of the country where there are jobs in the economy and a stronger labour market. That will be a real loss to our region and a real tragedy, and I regret it very much.

I want to draw my remarks to a conclusion now, because, fortunately, there is still time for other Members to take part in the debate, the previous business having come to a conclusion slightly earlier than usual—