Draft Tees Valley Combined Authority (Election of Mayor) Order 2016

Debate between Lord Wharton of Yarm and Grahame Morris

Tuesday 12th July 2016 General Committees

[Grahame M. Morris]

I am grateful to my hon. Friend for her intervention. That is precisely the point I was trying to make in a rather laboured way, for which I apologise. That is key to whether the deal can go forward. The control of EU funding is an essential part of the devolution deal. We seek reassurances from the Minister to the Tees Valley Combined Authority that expected levels of funding, including those expected from the EU, will be maintained, not just in the short term—without second-guessing the Minister’s answer— of the next two years, but in the longer term. We seek assurances that there will be local control of these funds.

In the light of the Brexit vote, there are understandable concerns about the impact on inward investment. Can the Minister offer some comments about how the Government are going to address potential instability and uncertainty on inward investment? That is key to the Tees Valley—as the Minister well knows having a constituency there—given the importance of the chemical industry cluster and the associated manufacturing industry.

I commend the work of the five councils in the Tees Valley Combined Authority and their efforts in seeking to secure the best deal possible for their area and their communities, despite the constraints placed upon them by Government. The £15 million devolution deal—that is £15 million a year over 30 years—can never fully compensate for the devastating cuts to local government. The Tees Valley area has already seen cuts in excess of £240 million per year since 2010: a huge sum of money to lose from local authority budgets. I appreciate the concerns about the Government’s commitment to investment, not only in the light of the referendum, but in view of the gross disparities between infrastructure spending in the capital compared with the regions. I ask the Minister to say a few words about how we are going to address these huge regional disparities.

The commitment to devolving education and transport can ring hollow when considering recent announcements regarding academies and the Bus Services Bill. I know we are not dealing with that here, Mr Gapes, but it is relevant to the package of the powers the elected mayor and the combined authorities will exercise.

I recognise that we are at the start of the devolution process and when the deal is complete, it will only be the first stage. While I am in post, I will support—

[James Wharton]

Very good, Grahame.

[Grahame M. Morris]

Thank you. While I am in post, I commit to supporting local areas in securing the deals that they want, that best suit local circumstances and that will best help them to meet the challenges they face in supporting and sustaining their local communities.

--- Later in debate ---

[James Wharton]

I will seek to address the questions raised by the shadow Secretary of State. I welcome the tone of his comments, although clearly there are areas of disagreement in terms of policy and the approach that the Government are taking. I have noted down the most salient points that I am to formally address. I will do my best to address them, but I am confident that he will intervene if there is anything that I have missed. The circumstances in which a Mayor might not be the best model—whether a Mayor is appropriate or not—seem to be the focus of much of his comments.

The Government have been quite clear. We have imposed a devolution deal on nobody. The Cities and Local Government Devolution Act 2016 gives the Government no power to impose a devolution deal on anyone. A deal is a two-way process where there are things that the Government want to see and tests and robustness that they want to be assured of, but where local areas are able to ask for the powers that they believe they can best use. That process of discussion takes place in each area, based on geographies determined by that area. This is an issue that I will revisit when speaking on the points made by the hon. Member for Darlington, but it is a bottom-up and bespoke process.

[Grahame M. Morris]

I have heard the Minister’s comments in response to the first question. I am not suggesting that he has been disingenuous but is not the truth of the matter that, in these discussions, which he has referred to as a bottom-up process, not a top-down process, there has in essence been a precondition that unless the combined authority accepts an elected Mayor it will not go any further? I am aware of discussions and reports of discussions with other combined authorities. We should be clear that it is the Government’s intention—by whatever method—to ensure that there are elected Mayors leading these combined authorities. If that is not the case, perhaps he might make it clear that combined authorities are at liberty to come up with another model and will still be able to have devolved powers, as set out in the order.

[James Wharton]

The Government will of course consider any proposal that comes forward from a combined authority, but we have been clear throughout this process that, where areas want a significant package of powers, there is an expectation that that comes with the clear and sharp democratic accountability of an elected Mayor. I will not try to use words to avoid the reality of this—I have been very clear about it. We cannot force any area to accept a deal, and we cannot force any area to accept a Mayor. The Government’s position is that, where areas want significant deals, we expect a Mayor to be part of that package. It may be an issue on which there is disagreement across the Floor of the House, but it is one on which we have been clear throughout this discussion and debate.

The shadow Secretary of State also raised the issue of Brexit, but specifically with reference to European funding. He referred to control over European funding being part of this devolution deal. It has been agreed that intermediate body status will be delivered. That issue was also raised by the hon. Member for Redcar. I give what assurances I can, in that at least for the time being we remain a member of the European Union, so nothing will change until exit is agreed. We of course must see how the process evolves and unfolds.

The truth is that we are a significant net contributor to the European Union and so, on exit, will have the opportunity, taking control of money that Europe currently decides how to spend, to spend it in accordance with the interests of this country and, indeed, under the direction of its people and Government. My intention will be to advocate very strongly indeed the continuation and, indeed, improvement of funding to the regions from within Government, but nothing is going to change in the near future. I encourage local areas to continue to pursue economic growth and to make a positive case for the projects for which they want support. Indeed, I support the Tees Valley in doing that, and in continuing to deliver the letter and the spirit of the deal agreed between its local authority leaders and central Government.

There has been a welcome rise in inward investment across the north of England in the past two years. It is up significantly, and we want to continue to encourage the process. I have no doubt that stability is something that drives decision making, and that those who choose to invest look for it. That is why I welcome the decisions that have been taken in my party to offer the country stability in recent days. I hope that for Her Majesty’s Opposition that process will also be brought swiftly to whatever its conclusion will be.

The Shadow Secretary of State also said—rightly; this is an issue on which we agree—that the process is at its start. Agreeing the devolution deal is not the sum total of what will be done. The Government’s ambition, which I hope is shared by local areas, is for devolution to continue; they want additional powers to be devolved and the areas in question to identify additional opportunities, which, in discussion with the Government, can be delivered into local hands to drive economic growth.

Incapacity Benefit (North-East)

Debate between Lord Wharton of Yarm and Grahame Morris

Tuesday 22nd November 2011 Westminster Hall

[Grahame M. Morris (Easington) (Lab)]

It is a pleasure, Mrs Brooke, to serve under your chairmanship for the first time. There has been tremendous interest in the economic effects in the north-east of changes to incapacity benefit. I was hoping for a much longer debate—a number of right hon. and hon. Members have indicated that they would be interested in participating in such a debate—but I will try to be brief.

I am pleased to have secured this debate, which gives me the opportunity to raise some important issues that affect communities throughout the north-east of England. As the title suggests, I want to focus on the economic effects of one specific coalition policy: the impact of welfare reform and changes to incapacity benefit. I shall refer specifically to a recent research report by Sheffield Hallam university on “Incapacity Benefit Reform: the local, regional and national impact”, and a report from the Institute for Public Policy Research North, the “Northern Economic Summary: October 2011”. I commend the latter report, which is the first of its kind, but IPPR North will produce it quarterly. It will be a useful way of tracking the impact of the Government’s policies on the north-eastern economy.

Before going into my main argument, I want to set the scene and to provide some context for the debate. The IPPR North report indicates that unemployment in the north-east is accelerating and is being driven by a weak northern economy being pushed into recession by public sector spending cuts, which are threatening to increase the north-south divide. The north-east, with Yorkshire and the Humber region, has faced the worst increases in unemployment in the UK. The figure for the north-east now exceeds 11%. Gross domestic product nationally suggests that the UK economy is avoiding a strictly defined technical recession at the moment, but it can be best described as flat-lining. Labour has a five-point plan to stimulate jobs and growth, but I do not want to go into that because of shortage of time. Perhaps it is a subject for another debate.

The situation for workers and those seeking work in the north-east is much bleaker than in many other regions. The northern economy could already be contracting, as the index of production figures produced by the Office for National Statistics show UK manufacturing contracting by 0.6% in the three months from June to August. Contraction in manufacturing affects the north-east disproportionately. It affects the economy in the whole of the north, but particularly the north-east because, despite the need to rebalance the economy—I am a great supporter of manufacturing—the north-east has a relatively high proportion of employees in manufacturing.

The latest job figures show that the north has lost a large proportion of public sector jobs in the last year. The figures produced by the northern TUC show that we are losing them at a rate of 2,000 a month, with almost no increase in the number of private sector jobs. In the north-east, the number of private sector jobs is declining. It has lost more than 32,000 public sector jobs, but more than 8,000 public sector jobs have been created in London, and 24,000 in the south-east. That is clear evidence of the Government’s failing regional policy.

I want to concentrate on the impact of the Government’s welfare reform policies on the economic situation in the north-east. Sheffield Hallam university’s report, “Incapacity Benefit Reform: the local, regional and national impact”, shows that 60,000 people in the north-east face being moved off incapacity benefits, 35,000 of whom will be pushed out of the benefits system altogether due to the time limits. More than 20,000 will be added to the unemployment figures.

My constituency has the highest rate of working-age adults claiming incapacity benefits in England and will be one of the most affected. In my constituency alone, 4,200 people will be moved off incapacity benefit, of whom 2,000 will lose their benefits altogether. That will have a huge adverse impact on those individuals and households, but I want to focus on what it means for the north-east economy as a whole.

If 35,000 people are taken off incapacity benefit altogether, as the pilot study indicates, that will effectively remove more than £170 million every year from the north-east’s economy.

[James Wharton (Stockton South) (Con)]

Will the hon. Gentleman give way?

[Grahame M. Morris]

I would like to make a little more progress, but I will give way when I have made my point.

That money would be in the hands of the poorest in society and would be spent in local communities, neighbourhood shops and local businesses. The clear economic argument is that unemployment would increase if benefits were cut in the region, owing to a reverse multiplier effect of credit withdrawal, because less money would be spent in the local economy. It is staggering that as the north-east seems to be heading into a regional recession, the Government are set to take another £170 million from our regional economy every year. It is even more staggering that, as employment is falling in the private sector owing to the Government’s lack of a credible policy for jobs and growth, they are simultaneously moving 60,000 people off incapacity benefit and adding more than 20,000 to the unemployment count.

The legacy of incapacity benefit is felt most in older industrial areas. The number of people claiming incapacity benefit is not evenly spread. The communities that I represent are mainly former coal-mining areas where long-term ill health is a consequence of years spent working in damp, cramped and physically arduous conditions underground. A recent review of coalfield areas by the former Member for the then constituency of Barnsley West and Penistone, Mick Clapham, reported two significant problems. He identified that incapacity benefit claims are not confined to the older generation, whose ill health was caused by working conditions. Ill health in the younger generation is due mainly to poor employment opportunities and the low expectations resulting from their marginalisation in the active labour market and has given rise to a lost generation.

[James Wharton]

I congratulate the hon. Gentleman on securing this debate. The topic is extremely important to him and to many of his constituents. I am a little concerned that he seems to believe that being on incapacity benefit when able to work is an acceptable end in itself. Does he agree in principle that those who are able to work should be encouraged to do so and should be taken off incapacity benefit and helped back into work? Does he also agree that, although incapacity benefit must be available for those who need it, the Government have a duty to review the system and to address some of the problems that have arisen as the system became out of control in recent years?

[Grahame M. Morris]

I will come to that. My fundamental point in response to the hon. Gentleman is that the big issue for us is not just worklessness; it is joblessness. We want the Government to invest in creating jobs in the private sector and generally to get the local economy moving. There seems to be little point in inflicting penury and misery on large sections of already impoverished communities when there are no jobs for them to go into. The two should go hand in glove, and I have some suggestions for achieving that.

Hospital Services (North-East)

Debate between Lord Wharton of Yarm and Grahame Morris

Tuesday 27th July 2010 Westminster Hall

[Grahame M. Morris]

That is a very good point and the development of community health infrastructure has been integral to the proposal for the new hospital. It is key to improving health and tackling health inequalities.

I have some sympathy with the Minister, as it seems that the proposed hospital suffered at the hands of the Chief Secretary to the Treasury as he searched to save around £2 billion in June. However, regardless of the changing economic circumstances that saw Britain’s budget deficit improve by £10.4 billion from the original pre-election forecasts, I do not believe that it is too late for the Minister to give the proposed new hospital a second chance, following a reconsideration of the evidence.

[James Wharton (Stockton South) (Con)]

Will the hon. Gentleman give way?

[Grahame M. Morris]

If you do not mind, Mr Sheridan, I will not give way to the hon. Gentleman. I know that time is short, but I am almost finished and I think that the hon. Gentleman will have an opportunity later to speak. I have almost completed my contribution.

As it stands, the future of health provision in North Tees and Hartlepool is being put at serious risk. The cancellation of the hospital at Wynyard can only ever be viewed as a delay—the need for it still exists. Whether it is a delay of five years, 10 years or longer, the people of Stockton North, Stockton South, Hartlepool, Easington and Sedgefield need a new hospital. I invite the Minister to think in the long term and not to abandon a well thought-out project that would improve health care for people who have suffered a legacy of some of the worst health outcomes in Britain.