Budget Statement

Lord Goddard of Stockport Excerpts

Monday 4th December 2017 Lords Chamber

[Lord Goddard of Stockport (LD)]

My Lords, it is always a great pleasure to follow the noble Lord, Lord O’Neill of Clackmannan, especially when he mentions plumbers and heating engineers; it brings back memories. I draw attention to my interests, as stated in the register. I am an elected member of Stockport Metropolitan Borough Council. This debate is on the Motion that this House takes note of the economy in the light of the Budget Statement. Noble Lords have ranged far and wide on that topic and I wait with bated breath for the Minister to somehow weave Brexit, Dusty Springfield, Cobra Beer and Led Zeppelin into his reply to them.

I made my maiden speech in this Chamber on 11 December 2014, in a debate on economic leadership for cities. Almost three years later, to the day, I am returning to that debate. However, there is a new name, so I will address myself to the proposals in the Budget for investment in the economy of the northern powerhouse. We all welcome the proposed £1.7 billion investment in the transforming cities fund, not least because half of the fund will be shared among the cities with metro mayors, which is good news for the two-thirds of northern powerhouse cities that have secured devolution deals. However, how do the Government propose to deal with the one-third that do not have such deals in place?

I am particularly pleased to see the massive strides that are taking place in the north-east. These will, no doubt, be buoyed up by pledges of investment in the Tyne and Wear Metro, the former Redcar steelworks site and a devolution deal for the north of Tyne. I hope that gives some comfort to the noble Lord, Lord Lennie. The northern powerhouse is coming his way. At the launch of the Northern Powerhouse All-Party Parliamentary Group, of which I was elected a vice-chair, it was refreshing to hear northern leaders from Manchester, Leeds and Newcastle, to name but three, at last singing from the same hymn sheet. The message we wish to send to the Government, loud and clear, is that we are not against London; we do not want money diverting from London to the north. It is vital that the London heartbeat carries on generating wealth and prosperity. However, the north has fantastic strengths and we need more support from central government to develop them further. In that way, the north will be able to increase its contribution to the UK economy, creating a more balanced and prosperous economy, and leading to a win-win situation.

The other refreshing message was that we are not holding out a begging bowl; we are proud northerners. Our claims are evidence-based and on a sound economic footing, as my noble friend Lord O’Neill of Gatley expanded on far more eloquently than I can, talking about the north-west’s new indicators.

People ask me what the northern powerhouse is. What does it do? Is it real? Is it of substance? I shall give your Lordships some quick facts about the northern powerhouse and they can judge whether it is real or not. The northern powerhouse economy is worth £316 billion and is bigger than the economies of Norway, Sweden, Austria and Belgium. There are 15.3 million people living in the northern powerhouse region—more than in Portugal, Greece or Belgium. There are 20 universities in the north, with a total revenue of almost £6 billion and employing 70,000 people. There are 1.1 million private sector businesses in the northern powerhouse—an increase of 167,000, or almost 20%, compared with 2010.

I give noble Lords those figures not to boast about the north but to try to illustrate the giant steps that we are taking, but we need to do much more. Sir Richard Leese, the leader of Manchester City Council, tells the story of a visit to China with a delegation a couple of years ago. He says, “If you could draw a line from Leeds to Sheffield and down to Liverpool, with Manchester inside that triangle, it would be smaller than the city of Beijing. That’s the scale of the challenge we face in competing with world cities”.

Connectivity is the key. We need to connect our great northern towns and cities to maximise productivity and attract investment. The distance from Manchester to Leeds is shorter than the length of the Underground’s Central line in London, yet it seems impossible to bridge that small gap. If we had new railways connecting the cities I have just mentioned with Liverpool and Sheffield, 7 million people and three times the number of businesses would be able to interact and develop the economy of the north. Once we unlock these cities, we can develop transport links to Hull and Newcastle, and truly become the real powerhouse. We welcome the £300 million investment for HS2 junction improvements announced at the Conservative Party conference, but there is much more to be done. The Budget was silent on further transport investment, which is of some concern.

Of course, more than just transport is holding back the northern powerhouse. Education and skills specifically in the north of England lag behind those in the rest of the country, and this must be addressed with joint working between our cities and support from the Government. The north has demonstrated how critical major investment in infrastructure and education would be, creating a country of equal parts, along with our other thriving major cities. That would make the northern powerhouse a significant player on a global scale, which would be good for the north and, I believe, great for the country.