Budget (North-East)

Debate between Chloe Smith and Grahame Morris

Tuesday 17th April 2012 Westminster Hall

[Miss Smith]

If the hon. Lady had let me press on, she would have heard the answer to much of what she asks a little sooner. Let me reassure her that I have often visited the north-east, although not since the Budget, so I look forward to a chance to do that, perhaps in the next recess. As many Members have said, it is a fine region and a great place that we should all seek to support.

Let me return to the matter in hand. In the Budget, the Government made it clear that they have three priorities: first, the creation of a stable economy; secondly, a fairer, more efficient and simpler tax system; and thirdly, reforms to support growth. The 2012 Budget, together with the national infrastructure plan that we published in last year’s autumn statement, set out the Government’s latest steps towards achieving those priorities, based on a model of sustainable and balanced growth, including, of course, in the north-east.

As hon. Members have made clear, the north-east faces difficult challenges. It remains, however, a significant contributor to the national economy, and I would like to reiterate and highlight the numerous good news stories that have been mentioned and involve companies that are already investing in the north-east and creating jobs for people in the area. For example, the Japanese automotive company Vantec has created 230 new jobs and secured 800 existing posts in Sunderland. Nissan has announced the creation of 225 jobs at its Sunderland factory and 900 more with its British suppliers. Both companies have been pledged money from the regional growth fund, which illustrates the difference that that initiative makes on the ground. I join other hon. Members in celebrating the relighting of the blast furnace at the SSI Redcar steelworks, which my hon. Friend the Member for Redcar (Ian Swales) mentioned earlier in the debate.

The reforms set out in the Budget will give businesses and individuals in the region a further boost on top of those private sector initiatives. Corporation tax will be cut by an additional 1% on top of the cuts announced last year. From April this year, the rate of tax will be reduced to 24%, and it will ultimately fall to 22% by 2014—a competitive rate when we consider our competitors around the globe. Let me reiterate that the Budget increases the personal tax allowance by £1,100, which will take 34,000 people in the north-east out of tax altogether. It also increases the Growing Places fund, which will provide additional funding for the infrastructure that is needed to unlock developments that lead to jobs and growth. Local enterprise partnerships in the north-east will receive a further £11 million.

I also confirm that Newcastle has been selected to become a super-connected city. I do not sneer at that; hon. Members may fail to welcome it, but the city will receive up to £6 million of funding to deliver ultra-fast broadband to residents and businesses, which is valuable. On top of that, the Budget includes investment of almost £28 million in stalled development projects within the north-east.

Hon. Members were keen to talk about capital spending in percentage terms, but let me provide some absolute terms and mention £4.5 billion for the intercity express programme; £260 million for the new Tyne tunnel; £57 million for the Tees valley bus network; £350 million to reinvigorate the Tyne and Wear metro; and £82.5 million for a new Sunderland bridge, which perhaps hon. Members will welcome.

[Grahame M. Morris]

I am grateful to the Minister for giving way as I know that time is short. However, she is reading out a list of projects that have already been delivered and were planned by the previous Government. Can she equate the £10 million in the Growing Places fund to a distance of new motorway, for example? Would it buy one, two or three miles of new motorway? We are talking about relatively modest sums of new money.

[Miss Smith]

I am afraid that my mental arithmetic does not extend to working out pounds per mile on the spot, but I will be happy to look into the hon. Gentleman’s question.

I will continue with my comments, which I hope will help hon. Members. I want to talk briefly about support in the Budget for individuals and families to buy new-build properties with a 5% deposit through the NewBuy scheme, and I wish to put it on record that the Budget increases the maximum right-to-buy discount—[Interruption.]