Devolution and Growth across Britain

Caroline Spelman Excerpts

Wednesday 3rd June 2015 Commons Chamber

[Mr Umunna]

My hon. Friend raises a very important point. The current account deficit is at its highest ever level at the moment, and she is absolutely right about the approach that we need to adopt.

Beyond the economic argument, which I have talked about, there is a bigger argument to be made for devolution. We know that levels of trust in politics are low, but we also know from research that policies formulated and delivered locally command far greater trust than those made in Westminster.

[Mrs Caroline Spelman (Meriden) (Con)]

Does the hon. Gentleman accept that west midlands manufacturers felt completely neglected for 13 years under the previous Labour Government and have enjoyed a renaissance only since the coalition Government? Is it not true that the severity of the financial crisis was much greater for the United Kingdom because our economy was so unbalanced in 2008?

[Mr Umunna]

I would say two things to the right hon. Lady. First, when I was in her area, I heard so many complaints, particularly during the last Parliament, about the abolition of Advantage West Midlands, the regional development agency. Secondly, those involved in the renaissance in the automotive sector in particular—the likes of Jaguar Land Rover and so on—tell us how helpful and important it was that the previous Labour Government established the Automotive Council.

As I was saying, I want to move beyond the economic case to make the democratic case. We know that levels of trust are higher in decisions made locally, but we also know that the contempt people have for politics is fuelled not only by a sense that we are all in it for ourselves, but by a sense of powerlessness—a sense of citizens’ powerlessness in shaping what the system does for them and a lack of confidence in politicians’ power to change things in the face of powerful global forces. What better antidote to that sense of powerlessness is there than to give people more power in their localities and communities?

This is very much my personal view of what we in this House are all guilty of, but people are desperate for an end to the partisan point scoring we sometimes see in this place. There is an increasing desire for politicians to transcend the partisan bickering that characterises a lot of debate here. On that point, I should refer to the last hour in the Chamber. We all mourn the loss of Charles Kennedy, the former Liberal Democrat leader and former Member for Ross, Skye and Lochaber. He was a great and brilliant parliamentarian. He was so popular, and there has been such a huge outpouring of affection since his sad passing, in part because he could transcend the Punch and Judy of this place. If we are honest, it is fair to say that our colleagues in regional and local government are often far better than us in putting aside party political differences and working together. An example often cited is the way in which Lord Heseltine, a Conservative, collaborated with our Labour colleagues in Liverpool over the years. That led to his being awarded the freedom of the city by the Labour administration there in 2012. Let us look at the work of the cross-party London Councils body, which has rolled out its successful apprenticeship scheme across the Labour and Conservative-run boroughs of the capital. That is another reason for devolution, and it would actually help our democracy.

--- Later in debate ---

[Mrs Caroline Spelman (Meriden) (Con)]

I welcome the hon. Member for Edinburgh West (Michelle Thomson), who shares with me the pleasure of having an airport in her constituency. I hope that she will forgive hon. Members, as I do, if they use her airport. I have definitely been through her constituency on many occasions in order to visit my family roots.

Representing a constituency in the west midlands conurbation, I have watched as Manchester and Leeds-Bradford have benefited from their collaboration, and I hope to see the councils in my area come together of their own free will to create a midlands powerhouse.

It is clear that trying to run the country from Whitehall has failed. The Government’s approach to devolution has the advantage that it does not impose a structure, as was the case with the regional development agencies, but lets the authorities choose who they want to work with. That is the key to the success of the local economic partnerships, and the one covering my area of Greater Birmingham and Solihull has been particularly successful. The old RDA’s actions resulted in money being sucked into Birmingham, with other surrounding authorities losing out. In a spirit of co-operation, I encourage the hon. Member for Streatham (Mr Umunna) to temper his views about the positive impression of RDAs by speaking to his colleagues from Coventry, who felt that they really lost out under Advantage West Midlands.

The sheer size of Birmingham City Council has been the sticking point for further collaboration. As the Kerslake report of December 2014 puts it, its size is

“both a badge and a barrier”

to its progress, and it faces

“significant budget difficulties…and does not yet have credible plans to meet these”.

It is no wonder that there is a degree of reluctance to combine.

The key to harmony in the Birmingham and Solihull LEP is the “one authority, one vote” policy for its governance structure. I believe that an explicit reference to that in the forthcoming Bill would give smaller local authorities the reassurance that they seek. The approach taken by Greater Manchester authorities of giving each authority a veto on sensitive policy areas such as housing and planning will also be key for councils such as mine. My area contains some of the most valuable regional and, indeed, national assets, including Birmingham airport and the National Exhibition Centre. There is also the Meriden Gap between Coventry and Birmingham, without which the area would simply be concreted over. Birmingham’s willingness to give itself one vote on decisions, thus placing itself on a par with the smaller metropolitan and shire districts, will give other councils the confidence to join.

I am not totally convinced about the establishment of a “metro mayor” for the midlands powerhouse. Rivalries between the towns and cities are intense, not least on the football pitch. I am thinking of, for instance, Aston Villa, Wolverhampton Wanderers and Coventry, to name just a few. Perhaps, however, a smaller local authority could take the lead.

I was interested to read that healthcare might be granted to the new combined authorities as a competency, and I think that would be helpful. It would also speed up the integration of health and social care at local level. Solihull is certainly keen to be in the vanguard, given its coterminous boundaries.

As for education, there is a great opportunity to devolve more powers and to achieve fairer funding. Let me be specific. Solihull educates more than 7,000 pupils from across its borders in Birmingham and Coventry, and the funding gap has increased to £1,300 per pupil. Solihull schools enjoy an excellent reputation, and parents want their children to benefit from it, but the funding shortfall is now having adverse consequences. For example, schools in Birmingham are poaching Solihull’s teachers with a premium payment of several thousand pounds, which Solihull cannot match. As a result of the funding differential, head teachers are struggling to manage without cutting staff and other vital services.

Surely the health principle of the money following the patient should apply to education as well. The pupils who attract higher per capita funding because of where they live should be able to bring that funding with them to the place where they are educated. That is an easier principle to deliver than the wholesale change in the funding formula—which, incidentally, I support, but which will create both winners and losers. In a reductio ad absurdum, Birmingham would have to build at least six new schools for the pupils whom Solihull currently educates, which would be a very inefficient use of taxpayers’ money.

Some important considerations are necessary when it comes to this level of devolution. Lord Heseltine was right to point out in his report “No Stone Unturned” that our country is held back by its over-centralised structure. Devolution will bring diversification. It will not be possible to cry “postcode lottery”.

I welcome the principles of the devolution Bill. I believe that our great city should seize the opportunity to take new powers to better meet the needs of its citizens.

[Several hon. Members]

rose—