Midlands Engine

Chris White Excerpts

Tuesday 24th January 2017 Westminster Hall

[Chris White (Warwick and Leamington) (Con)]

I beg to move,

That this House has considered the Midlands Engine.

It is a pleasure to serve under your chairmanship, Mr Howarth. I thank the Backbench Business Committee for granting this debate.

Some 105 Members represent the midlands region. We may not have all of them here this morning, but we are represented by quality if not quantity. The midlands is a major contributor to our national economy. It generates 13% of the UK’s gross value added and has enormous potential to be at the forefront of economic growth. The midlands engine initiative is therefore extremely welcome and necessary to develop a long-term strategy that works for business, the region and its people.

As I am sure we all know, the midlands is the biggest economic region in the UK outside London. It has a £210 billion economy and employs 4.6 million people. If we adopt the right approach, it will be well placed to build significantly on that, and that is what I hope to discuss this morning.

We have a rich industrial heritage going back to the industrial revolution; our constituencies are linked by a comprehensive canal structure that dates from the beginning of that time. Today’s economy is much more diverse, but our sense of regional identity remains strong and manufacturing continues to be an essential and vibrant sector. It is right for the midlands engine to pay tribute to that history and to use it as a foundation for the prosperity and growth to come.

In formulating the strategy, the first consideration is the extent to which powers should be devolved from the Department for Business, Energy and Industrial Strategy to the midlands engine, our local enterprise partnerships, our local authorities and the West Midlands combined authority, striking a balance between empowering the region and maintaining sufficient oversight of returns on investment.

It is good to see the Minister, who represents a Warwickshire seat, in his place. As I have told him, we could devote time to unitary authorities as part of this discussion, but we will save that debate for another day. Perhaps he will put a date in his diary.

The midlands is already an attractive proposition for business, but to improve the situation further more investment in infrastructure is absolutely essential.

[Julian Knight (Solihull) (Con)]

I congratulate my hon. Friend on securing this important debate; he is a strong champion for our region as well as for his constituency. On infrastructure, I wonder whether he welcomes the tone of our Prime Minister towards the midlands engine. Although the announcement on infrastructure yesterday was largely to do with northern areas, there is a strategy paper on the way—and, crucially, LEP allocations to go with it.

[Chris White]

I thank my hon. Friend for that intervention. I hope we will see over the coming weeks a more tangible effort and energy going into the midlands region, with local enterprise partnerships having the necessary funding to do what we require them to do.

[Ian Austin (Dudley North) (Lab)]

It is great that the hon. Gentleman has secured this debate, and I congratulate him on it. The point about infrastructure spending is really important because there is a massive disparity between the amount of spending in the midlands and that in other parts of the country. Transport funding per capita in the west midlands is less than half that of Scotland and 40% of the level in London. In the midlands as a whole, which has 10 million people, we got a mere £1.72 billion spent on transport compared with London, whose population is smaller—it had £3.87 billion. Over a decade, £15 billion less has been spent on transport in the midlands than in other parts of the country.

[Chris White]

I get the hon. Gentleman’s point. I am sure the Minister is listening to see how we can rebalance our regions to make sure essential investment will be forthcoming.

[Mr Andrew Mitchell (Sutton Coldfield) (Con)]

Does my hon. Friend believe that the hon. Member for Dudley North (Ian Austin) should include in his figures all the investment that is going into HS2 in the midlands, particularly in Birmingham?

[Chris White]

I was coming on to HS2, which I have religiously voted against at every single opportunity. However, even I am beginning to see that it may become a reality. If it does, we must make sure that we take the benefits that HS2 brings, whatever they may be.

[Mr Jim Cunningham (Coventry South) (Lab)]

The hon. Gentleman, like me, is obviously opposed to HS2. The only area of the midlands to benefit will probably be Birmingham and the surrounding area, but Coventry and Warwickshire, where he has a seat, will not necessarily benefit.

More importantly, whatever the negotiations in relation to Brexit are, we need the Minister to reassure us that regional aid will be replaced with another form of aid for the midlands. We do not want to lose out. When I was leader of Coventry City Council, we did not get regional aid; companies such as Nissan went to Sunderland instead, because that area got regional aid. That is a very important point.

[Chris White]

I thank the hon. Gentleman for his intervention. He says, perhaps unkindly, that Birmingham might be the only place that benefits from HS2, but there has been a suggestion that only London will benefit. He is tempting me into a debate that is perhaps for another day.

Digital infrastructure is also part of our connectivity and a vital component today. That will increasingly be the case in the interests of the local economy. Each region has its own specialisms and needs, which means that it is necessary to make tailored decisions that will impact positively on each region. Midlands Connect has an important role in this, representing the transport partnership of the midlands engine with 28 local authorities, Network Rail, Highways England, Government and the business community working together. In addition, developing a skills base to match the demands of an ever-evolving business world is imperative. As such, aligning skills with regional business can be instrumental in boosting our economic growth.

The Government’s industrial strategy, which I was delighted to see launched yesterday through a statement in the House, is a policy I have spoken on at length before. I see the midlands engine as an important part of the broad approach. As the strategy develops, regional empowerment must be at its core so that the constituent parts of the UK reach their potential and the whole nation benefits.

As with the industrial strategy, the midlands engine must be underpinned by a focus on individuals and communities feeling a part of the policy. If each community understands how relevant the strategy is, that strategy will seem much closer to individual citizens than something such as a long-term economic plan. Individuals and communities can better understand the role that they can play in an industrial strategy.

[Craig Tracey (North Warwickshire) (Con)]

I congratulate my hon. Friend on securing the debate. He will be pleased that I am steering clear of HS2; my thoughts are broadly in line with his, if not a little stronger.

One of the key industries for my constituents is the motor industry. Does my hon. Friend agree that it is important to support businesses that choose to locate themselves in north Warwickshire, such as Plastic Omnium, Sertec and the smaller businesses that play such a vital part in the supply chain and the local economy?

[Chris White]

I worked for MG Rover and I know Plastic Omnium and its role in the supply chain. We are very proud to be home to Jaguar Land Rover in Warwickshire, and investing in the supply chain is just as important as investing in and supporting Jaguar Land Rover.

“The Midlands Engine for Growth: prospectus”, which was produced in 2015, saw 11 local enterprise partnerships join together to produce a vision for the region. I was particularly heartened to see manufacturing and engineering highlighted as the cornerstone of future success. As the co-chair of the all-party parliamentary group on manufacturing, I recognise how important it is to incentivise UK-based production, whether through new investment or reshoring.

Advanced manufacturing is a notable aspect of the midlands economy and can propel our competitiveness globally. As the prospectus identifies, advanced manufacturing is the bedrock of the region, employing more than 600,000 people and accounting for just less than 20% of the UK’s manufacturing output. It was good to visit Jaguar Land Rover with the Secretary of State for Business, Energy and Industrial Strategy on Friday, to see some of the technologies taking place there that will lead not only the region but the country, on a global level.

I welcome the Government’s support for the Catapult network. The high-value manufacturing Catapult has generated £15 of benefit to the economy for every £1 of funding. It cannot be said enough that research and development is key to our future success; it acts like a magnet for business and is the core of business and manufacturing. To lose our R and D facilities would be to endanger our manufacturing output, which is just beginning to recover. Other projects include the Energy Research Accelerator, where six world-class universities are working together with the support of £180 million of investment, as well as the energy systems Catapult, which is located in Birmingham.

Energy storage is an issue for the future and the midlands can be a driving force in developing those technologies. If we are serious about electric cars, which are the cars of the future, we need the batteries to power those cars. To be able to produce those batteries where the cars are manufactured—in Warwickshire, in the midlands, at Jaguar Land Rover—we need the power supplies to be able to make that happen.

[Mr Mitchell]

I congratulate my hon. Friend on securing this important debate. He is making a very good speech. Would he agree that apprenticeships, which have been championed by the Government, have had a real effect on the midlands region? In particular, they have stopped our region from being at the bottom of the employment league table in Britain and have significantly increased the number of new businesses that are starting and growing in the west midlands.

[Chris White]

I thank my right hon. Friend for that intervention. Apprenticeships are very much part of our future. I was also very fortunate to visit Warwickshire College with the Minister for Apprenticeships on Thursday. It was great to see how those young people are taking a totally different path for their future—one becoming more recognised for the skills that it will deliver—and to see them designing clays for cars and getting right into the process. Any encouragement we can give to make sure that business, schools and colleges are working together to increase the number and deliver on the 3 million apprenticeships that we need by 2020 can only be beneficial to our regional and national economy.

We need to have a thriving environment for innovation and tech. In my constituency, that includes the creative industries—the video games sector cluster is rapidly becoming the second or third-biggest cluster outside London. We need to create a framework in which such sectors can thrive, providing a flow of talent into the industry.

Developing a local identity on a regional level can be a catalyst for success. We have a proud tradition of manufacturing that we must build on, but other sectors can come to the fore and boost the region’s international prospects—in particular the creative and digital industries.

I hope that our strong academic base can continue to grow. The midlands is home to 25 universities and 50 further education colleges. Closing the skills gap across a variety of sectors is an integral part of the midlands engine and poses one of the greatest challenges ahead. Technological advances are shifting the needs of industry and we need to embrace the opportunities ahead, such as in Industry 4.0, and pinpoint areas that we need to strengthen, such as encouraging children to study science, technology, engineering and maths subjects. I note that the midlands engine prospectus highlighted proposals to create a network of regional science parks. I fully support efforts to push the midlands to the forefront of academic research in the UK, complementing our advanced manufacturing and technical skills base.

On a slightly negative point, productivity is a key challenge for the midlands—it is 10% lower than the national average. Improving infrastructure, as well as continued investment in science and research, could have a profound effect on reversing that figure.

In the autumn statement, the Chancellor announced that a midlands engine strategy was to be published, and I understand that more details will be provided in the coming weeks. Yesterday’s industrial strategy Green Paper pointed to places making their own unique contribution to driving national economic growth. Much has been made of the northern powerhouse and the regeneration of the north, which is an important goal, but I hope that the midlands engine can develop in parallel, working with other regions wherever prudent. We must continue to attract foreign investment, which will naturally happen as we strengthen our network of business, research and education.

[Julian Knight]

Part of attracting foreign investment is connectivity through Birmingham Airport. As my hon. Friend is probably well aware, Birmingham Airport is, frankly, a couple of decades behind Manchester in many aspects at the moment, although it does have spare capacity. Would he support my call, and that of the hon. Member for Dudley North (Ian Austin), to devolve air passenger duty so that Birmingham Airport can compete on a level playing field as devolution moves forward?

[Ian Austin]

indicated assent.

[Chris White]

I thank my hon. Friend for his intervention, which got a “Hear, hear!” from the other side of the Chamber. I suggest that those sorts of powers could be devolved; at the same time, if my hon. Friend could ask Birmingham Airport not to increase the number of flights over my constituency, that would reduce my postbag.

[Ian Austin]

The important thing about Birmingham Airport, with its 12 million passengers last year, is that it contributes £1 billion a year to the regional economy. With HS2 on the way, expanding capacity at Birmingham would enable it to play a much bigger role as a global hub, increasing the region’s connectivity and enabling travellers and businesses to come to the midlands and local businesses to export much more easily.

[Chris White]

The hon. Gentleman makes a valid point about the connectivity of our transport infrastructure. The airport issue, which could be contentious, deserves time for its own debate. Debates on the midlands engine and everything that will underpin that engine need to happen again and again. Just to discuss the issue this morning and then close the door would not serve any purpose.

[Maggie Throup (Erewash) (Con)]

My hon. Friend has been talking about Birmingham Airport. I would remind everybody that there are two airports in the midlands—there is East Midlands Airport as well. We need to make sure that there is connectivity across the whole of the midlands, not just the west midlands.

[Chris White]

That is a salutary reminder that the midlands are made up of both the west and east, and I thank my hon. Friend for that contribution.

[Lilian Greenwood (Nottingham South) (Lab)]

Will the hon. Gentleman give way on that point?

[Chris White]

I will, although I can imagine what the hon. Lady is going to say.

[Lilian Greenwood]

I just wish to follow up on the point made by the hon. Member for Erewash (Maggie Throup). East Midlands Airport is, of course, different from Birmingham Airport in that it is the second-largest freight airport in the country, which is hugely important for serving businesses across the whole region. Will the hon. Gentleman acknowledge that point?

[Chris White]

I thank the hon. Lady for making it simple for me by asking me to acknowledge the point. I most certainly do.

As with the industrial strategy, it is important to provide measures to understand how the midlands engine initiative is succeeding. For example, to what extent do we need to boost foreign direct investment? How many apprenticeships are needed in the region? What is the required level of financial support for science and research? An office for industrial strategy could and should be created and held accountable for the progress made, including our region’s economic success.

The Green Paper sets out 10 pillars to boost the nation’s economy, from business growth and investment in infrastructure to clean energy and world-class research. The midlands engine touches on all those pillars and will benefit from the strategy. In turn, the region can play an instrumental role in our nation’s success.

--- Later in debate ---

[Chris White]

Once again, I thank you for your chairmanship, Mr Howarth. I am grateful for the Minister’s response to the debate, and am also grateful for all the Members who were able to contribute. I agree with the Minister—one thing we share is our passion for the midlands. How we reach a consensus on a direction for the midlands will play a key role in how the strategy develops.

I cannot end this debate without mentioning that, in terms of vibrancy and desirability to live, Warwick district has just come top in the west midlands. That is possibly because we have the skills, we have low unemployment, we have the colleges and we have the great universities on our doorstep. I hope what we have in Warwick district is a microcosm of what we will be able to achieve in the midlands as a whole. I hope that, as the strategy develops into a White Paper, the debate will continue to ensure that we achieve the best we can for our constituents and the region as a whole.

Question put and agreed to.

Resolved,

That this House has considered the Midlands Engine.