Economic Growth and Employment

Debate between Andrew Percy and Chuka Umunna

Wednesday 23rd November 2011 Commons Chamber

[Mr Umunna]

Perhaps the Secretary of State will address that comment in his response.

Almost one year after the regional growth fund was announced, and six months after due diligence should have been completed, the winning bidder to which I have referred has still not received any money from the regional growth fund. It is clear to me, in that case, where the blame lies for the delay: it is not with the successful bidder. That organisation provides onward distribution of fund awards to businesses that desperately need it. As a result of the chaos, confusion and delay, the bidder in that case tells me that between 3,000 and 4,000 businesses are being deprived of the moneys they need, putting an estimated 11,800 jobs at risk.

What about the other bidders that provide the onward distribution of funds, and the businesses that could support jobs and growth? As I have said, the situation is a fiasco. It is no way to run a Department, and it is no way to treat our businesses or grow our economy. The Secretary of State and his Department are not doing enough to get our economy growing; what little they are doing, they are doing badly.

[Andrew Percy (Brigg and Goole) (Con)]

The hon. Gentleman makes a reasonable point about ERDF delays, one of which I have drawn to the attention of Ministers myself, but, having spent 10 years a councillor in the city of Hull dealing with organisations such as Yorkshire Forward, I must say that the nirvana picture of the RDAs that he tries to paint is certainly not my experience. The points he makes now are exactly the same points that we could have made about Yorkshire Forward and its processes for the past 10 years. The problem is the systems, not, as he outlines, how we structure them.

[Mr Umunna]

With the greatest respect to the hon. Gentleman, the question is whether the Department is doing what it promised to do for those businesses, which is to give them money and to carry out due diligence in a quick and timely way. It has failed to do so. I do not claim that there was a nirvana in relation to RDAs, but we are talking about the regional growth fund, and we actually want it to succeed.

The Government’s latest attempt to grow the economy consists of making it easier to fire, not hire, people. Today, to great fanfare, the Secretary of State said that the service required to claim for unfair dismissal should be increased from one to two years. He said this morning that

“this will mean that business can once again have the confidence to hire the staff they need to grow and thrive.”

That is a retrograde step for a Government who think that watering down employees’ rights is a substitute for a proper growth plan.