Economic Regeneration (Barnsley)

Bob Stewart Excerpts

Thursday 16th June 2011 Commons Chamber

[Dan Jarvis]

I thank my hon. Friend for that constructive and useful intervention. I believe that the ASOS model provides a useful example of how the Barnsley development agency, working with the metropolitan borough council, can aggressively seek to target other industries and businesses. The ASOS model is a useful one that we need to learn lessons from and employ in future.

As I have said, what we need is the investment to overcome the entirely man-made barriers to our progress. Without that, as my colleague the shadow Business Secretary recently said,

“the government’s belief that the retreat of the state is automatically matched by the expansion of the private sectors is going to be tested to destruction.”

The Government have dispensed with the strategic investment fund, with grants for business investment and with regional development agencies. The new regional growth fund has only a third of the money that was available under RDAs. I accept that RDAs were not without their failings, but the local enterprise partnerships that have replaced them are short on funding and short on power.

[Bob Stewart (Beckenham) (Con)]

Does the hon. Gentleman honestly think that any Government Member or anyone in this country wants to cut jobs just for the sake of it for some reason of politics? The fact is that jobs have had to go because we just cannot afford them any longer and we cannot just plough money into the public sector all the time.

[Dan Jarvis]

I thank the hon. Gentleman for his intervention. I do not believe that Government Members think of these issues in such ways but this is a matter of policy. Barnsley is the kind of place that will go into a recession first and come out of it last and I believe that when the Government are making significant cuts to public services that will have an impact on jobs and livelihoods across Barnsley, they have a duty and an obligation to pause and consider the effect that those cuts will have on the people in Barnsley.

Where public sector cuts are made and jobs in the public service are lost, I do not believe that it is a given that the private sector will come in and fill the void. That should not be a natural assumption. In order to promote the kinds of conditions that allow the private sector to invest in places such as Barnsley, there needs to be a targeted programme of investment and development. I do not believe that the policies that the Government are putting in place will do that, but I thank the hon. Gentleman, as ever, for his useful intervention.

The LEPs, which have replaced RDAs, are short on funding and short on power. They are not even guaranteed the money for their own start-up costs, never mind for investment to support business. They will have to apply to the regional growth fund, whose first round of funding is already 10 times oversubscribed, and they have been denied access to cash from the European regional development fund, which is being centralised at the desk of a Whitehall bureaucrat. Perhaps the Minister can explain how that fits with the Government’s supposed localism agenda.

I believe that we can and must do better than that. First, we can strengthen the LEPs and make them much better able to co-ordinate and lead a strategic approach to regional development. Among other things, that means giving them access to the ERDF and allowing them to join together to secure investment for cross-regional projects. It means giving them a stronger, more formal role in the development of local economic growth plans. It means removing or reducing the £1 million threshold for RGF bids so that smaller companies can apply and LEPs can work with them to bring in the investment projects needed to spur growth. Will the Minister consider these changes?