Businesses (North of England)

David Rutley Excerpts

Wednesday 14th January 2015 Westminster Hall

[Mrs Anne Main (in the Chair)]

Seven Members have indicated that they wish to speak, and 13 from the Government Benches alone look as if they wish to make interventions. I ask for any interventions to be brief and in question form.

[David Rutley (Macclesfield) (Con)]

It is a pleasure to serve under your chairmanship for the first time, Mrs Main. I am grateful to have secured this debate and I am delighted with the support of colleagues, for which I thank them, on a vital subject for us and our constituents.

This is a timely debate that goes along with other big conversation debates about the northern powerhouse. Just last week, the Prime Minister and the Chancellor went to Manchester and set out their commitments to the north-west. Obviously, other hon. Members will want to talk about what the commitments need to be in the north-east as well.

I am delighted that my right hon. Friend the Minister for Universities, Science and Cities is present. We are fortunate to have him here. He has been consistent in his approach, putting forward the agenda for the cities and for the north. He is also a Member from the north, from Middlesbrough. We regard him as a real friend for our cause and are delighted by the time and effort that he is putting into looking at proposals to take forward the economy in the north. We are delighted that he is here.

Last week, the Prime Minister talked a lot about the north-west. Obviously, that interests me as the Member of Parliament for Macclesfield, which, as a few colleagues have pointed out, is in Cheshire in the north-west. I will focus a lot of my remarks on the north-west, but no doubt other Members from the north-east and Yorkshire will want to put forward their views on what needs to be done to help move the agenda forward on the east of the Pennines as well.

There is a lot to celebrate in the north. British Chambers of Commerce has been in touch with me, having found out that this debate was taking place, and it highlights that a quarter of UK manufacturers are in the north; that Sheffield has world-leading expertise in advanced materials; that the second largest digital and creative sector cluster in Europe is in Greater Manchester; that the automotive cluster around Nissan in Sunderland accounts for one in three of the UK’s cars, although I think that more will be going on over in Merseyside to compete with that; and that there is a £6 billion petrochemicals cluster around the Humber. Macclesfield was famous for silk and is now leading the way in life sciences, with 2,200 working at AstraZeneca’s Macclesfield site.

This is something that we can be proud of. I spent a lot of my career—about 11 years—working in Leeds, which is now the second biggest financial and legal services cluster outside London. I worked with Asda and Halifax General Insurance. There are real case studies of best practice here that we need to celebrate, and we need to maximise the opportunities.

[Julian Smith (Skipton and Ripon) (Con)]

Does my hon. Friend agree that the difference between the south and north from a business point of view can be characterised by the fact that only about half a dozen FTSE 100 companies are headquartered north of Watford? That has big implications for many of the things that I think my hon. Friend wants to raise in this debate and means that northern businesses need to be represented strongly.

[David Rutley]

Absolutely; without question. Having spent many of my working years in the north, it is clear to me that we need more focus, not just from the Government but from business. We know, from the businesses we work with, that there is huge enthusiasm to make the northern economy flourish and become even stronger. There is no question but that there is more work to do, including in the private sector as well as in the public sector.

I should like to set out what the Prime Minister said are his six commitments for the north-west, to remind colleagues. He said clearly in Manchester that he wanted to see an increase in the long-term rate of growth in the north-west at least at the forecast growth rate of the United Kingdom. He wants to see the north-west at the same average employment rate as in the UK as a whole. We have seen progress already. Output per head in the north- west grew faster than, or at least as fast as, elsewhere in the UK during 2013. The ambition is to generate an £18 billion real-terms increase in the size of the north-west economy by 2030, with more than 100,000 more people in employment during the next Parliament. These are big ambitions, and they are so important because in the north-west and in the north generally, historically, we have not seen the employment levels that the area and the region deserve. We need to do more to help achieve those ambitions.

The Prime Minister talked about how those commitments would be achieved. He talked about getting the largest ever and most sustained investment in the long-term transport infrastructure of the north-west and about making sure that we get scientific innovation standing out more.

[Graham Evans (Weaver Vale) (Con)]

On infrastructure, does my hon. Friend welcome the announcement about the Mersey gateway bridge, which is being built over the river Mersey, opening up the port of Liverpool with greater Cheshire and beyond? Also, the northern hub and electrification of the trans-Pennine routes will open up Manchester and Liverpool over to Leeds and Hull.

[David Rutley]

My hon. Friend anticipates things that I was going to say, but yes, absolutely. The Atlantic gateway is one of those vital, iconic and important infrastructure schemes in the north-west that we want to support. I know all too well the hard work that he is putting into Daresbury and into life sciences. A clear strategy is emerging and we need to make sure that we fulfil its potential.

The Prime Minister also highlighted the cultural and sporting strengths in the region.

I should like to spend a little bit of time on how we transfer power to our great cities and how to ensure we link that with the counties around them. Of course, the north of England led from the front during the industrial revolution. The ambition of the northern powerhouse is to ensure that the north leads the post-industrial—what we might even call the re-industrial—21st century, too. We have the support in the north. People from different political parties and others such as the chief executive of Manchester city council, Sir Howard Bernstein, talk about how the north should become the

“destination of choice for investors”.

There is no question about that, but I believe it should be a destination of choice for career seekers, hard-working families, tourists, for audiences, students, and many more. In this region we need to get support behind what I call the four e’s of economic success—entrepreneurs, employers, exporters and, of course, employees—and help more people trying to take that first step in any of those areas.

[Guy Opperman (Hexham) (Con)]

My hon. Friend will know, of course, that the north-east is leading the way, with the fastest rate of growth of private sector business in the autumn quarter. On supporting the four e’s, does he agree that it is key that the Government, local authorities and the local enterprise partnerships ensure that broadband access, which we all need so much for our businesses, is made available to all parts of the country as quickly as possible?

[David Rutley]

Absolutely. Superfast broadband is vital, particularly in places such as Hexham, with its rural communities, but it is just as vital in some more remote communities in Macclesfield and the Peak district. I am thinking of Rainow, Wincle and Wildboarclough; if they are going to survive and thrive, they need to have access to superfast broadband.

The other thing that we need to do to support businesses is ensure that they have information about the support that is available. Too often, speaking to the Federation of Small Businesses and small businesses in Macclesfield and in the north-west, I hear that they find it difficult to work out how to get access, whether to employment allowance or export finance or training and apprenticeships. We have to do everything we can to ensure that we communicate well and get the word out: that is partly our job as Members of Parliament, too. Having served on the FSB’s recent productivity inquiry, it is clear to me that it wants better communication.

On strategic priorities, I believe, like many of my colleagues here, that life sciences and transport infrastructure are vital and that the transfer of power away from Whitehall is critical. A growing consensus is emerging on that. Whether I speak to the North West Business Leadership Team or the local enterprise partnerships—the Cheshire and Warrington enterprise partnership is doing a good job—there is support for that approach on strategic priorities.

On life sciences, in early 2013, the prospects for Cheshire East’s Alderley Park site were not good. AstraZeneca had made a decision to relocate—some colleagues will remember this only too well—its research and development staff to Cambridge. Those were concerning times, but now, a year and a half later, we have seen more than 300 jobs brought to the site. There is a new business owner, Manchester Science Partnerships, and a healthy pipeline of businesses wanting to locate there. That success could not have been achieved without close collaboration between Cheshire East council, Manchester city council—they are councils not of similar political views, but of common economic interests, coming together for the local good—and the university of Manchester. It is a powerful case study of how collaborative partnerships can work for the economic interests of local citizens, about which the Minister is absolutely passionate.

On the back of that partnership, we secured a £20 million investment from the growth deal to help further strengthen life sciences in the area, which is a real boost. Success breeds success. We are seeing that sense of partnership and wider collaboration growing. There are imaginative and innovative plans.

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

I thank my hon. Friend for highlighting some of the successes on the eastern or, as we call it, the better side of the Pennines—that is a fact, Mrs Main—early in his speech. On collaboration, I completely agree with what he is saying, but we have a problem in the Humber that goes back to the days of Humberside. Our local authorities are split between east Yorkshire and north Lincolnshire and simply find it hard to get on. Our fear relates to the absence of the local authorities being able to agree to share services or work more collaboratively. We must not miss out in the Humber because our local authorities cannot get on.

[David Rutley]

I am not familiar with the issues on the ground that my hon. Friend is experiencing, but local enterprise partnerships and the funding that goes through to them are critical to bringing local authorities together. If local authorities are committed to delivering economic growth for local citizens, they will have to work together. I am sure that the Minister will have more to say on that.

[Julian Sturdy (York Outer) (Con)]

My hon. Friend is making a powerful point and an excellent speech. When we are talking about devolving powers and funding, which is exceptionally important for the north, we must remember that the rural areas play a key part across Yorkshire and Humber and on the other side of the Pennines in the north-west. They must not be left behind in this devolution.

[David Rutley]

Once again, an hon. Friend makes a vital point. It is critical to bring city and county together. There is a lot of talk about cities, and that is understandable, as a lot of journalists work in cities and they get that side of things, but the truth is that the broad and important rural agenda needs to be linked into cities. I passionately believe that city and county need to work together, and it will be through strategic partnerships that we make that work. The initiative in Cheshire, Liverpool and Manchester that we want to move forward is the science corridor, so that we have a thriving life sciences sector stretching from Liverpool to Manchester, down to Alderley Park and east to Macclesfield.

[Stephen Mosley (City of Chester) (Con)]

My hon. Friend is talking about life sciences, but it is worth saying that there has been a total renaissance of all science in the north-west. We have the Sir Henry Royce Institute in Manchester, the Cognitive Computing Research Centre at Daresbury, the Square Kilometre Array in Cheshire, the National Graphene Institute at the university of Manchester—

--- Later in debate ---

[Mrs Anne Main (in the Chair)]

Order. I do want to get cross, particularly since Members are making excellent points, but I am sure the hon. Member who secured the debate would like to continue.

[David Rutley]

It is difficult to contain the enthusiasm of my hon. Friend the Member for City of Chester (Stephen Mosley) for this subject, and it is great to see, because it makes a difference. I understand and accept the points that he raised. He makes an important contribution through his passion and interest in these matters and through the Science and Technology Committee. At Prime Minister’s questions last week, in response to my question about what we can do at Alderley Park for life sciences, the Prime Minister talked about how it had a crucial part to play in the improvement of life sciences in the country. He said that we need to get more growth deal funding and other initiatives to help bolster life sciences in the north-west.

My hon. Friend the Member for City of Chester anticipated my next point: this is not just about life sciences; it is also about astrophysics. My hon. Friend the Member for Congleton (Fiona Bruce) will appreciate the importance of the Square Kilometre Array initiative. It is the world’s biggest radio spectrum telescope, and it is based in Cheshire. It is a globally significant project. We have seen the initial project phase based in Jodrell Bank, and we are pushing to ensure that further phases are headquartered there. I very much hope that the Minister will have a few things to say in support of that, because it will put astrophysics and science firmly on the map in the UK once again. That will not only ensure that the north is known as a leading edge in science, but encourage more leading-edge thinking across industry.

I will move on to infrastructure, because many other colleagues want to speak. One of the things we need to do in the north is ensure that we can get to it and get around it a lot more effectively. There is another powerhouse, I understand, in the south. Some refer to it as London, but people recognise that it is a conurbation of towns and villages from Uxbridge to Upminster and beyond. Crossrail will improve connectivity in that conurbation, but the truth is that we need to do a lot more in the north. As many people will know, it takes longer to get from Liverpool to Hull than from London to Paris, and that has to change. There are exciting positive initiatives such as the big new trans-Pennine high-speed rail project, which some people call High Speed 3, or overdue rail electrification, to which others have referred.

All those things are vital. HS2 will bring greater connectivity, but I want to ensure that we continue to have good, vibrant services with the same regularity and speed on the west coast main line. People will fully understand that HS2 is about driving capacity, which is what we need to ensure that we have the right connectivity. That will ensure that skills are easily transferred among the different clusters in the north that we need to see thrive and succeed in the years and decades ahead.

My last point on strategic priority is on transferring power to the north. It is compelling to see the Government propose an agenda that resonates with local authorities that might not have the same political sympathies and views. Anyone looking at the economic development of the north will realise that it is wrong to think that London should do everything. That is an over-centralised, metropolitan and outdated view of how a modern economy should run.

In the United States and in Germany, economic prosperity is much better balanced across major cities. We need to ensure that the situation is the same in the UK. I am delighted that the Government secured an agreement with Greater Manchester council and the Greater Manchester area to create a new mayor with powers brought in from the existing police and crime commissioner. That has gained real support from local leaders. It might not sit well with Labour Front Benchers, but locally it is sitting extraordinarily well with leaders who want more power. I welcome giving it to them, because with success and progress in Greater Manchester, the counties around will succeed, too, if we create those partnerships.

[John Stevenson (Carlisle) (Con)]

I fully support decentralisation. I am very supportive of elected mayors—the metro mayor concept is definitely a positive for the north—but I am always concerned that places such as Cumbria do not get left behind. Can my hon. Friend envisage an elected mayor for Cumbria as a counterweight to the powerhouse of Manchester?

[David Rutley]

It is probably way above my pay grade to try to think through what should happen in Cumbria. Like my hon. Friend, I love Cumbria and do not want to see it get left behind. The infrastructure points raised about rural broadband and transferring power must link into rural communities. Otherwise, the northern powerhouse initiative will not achieve the potential that the north deserves. His idea is worth exploring, but I am sure that he has more expertise in that than me.

In drawing to a conclusion, I want to focus on the lessons from Alderley Park, which was an important experience in my career, to see how partnerships between city and county can bring about successful results. In further reference to the point about Cumbria, let us learn the lessons from such experiences to ensure we take the maximum from them.

[Julian Smith]

Like my hon. Friend, I pay tribute to the work that Manchester has done, but does he agree that Leeds, which also wants to do a deal with Whitehall, needs to show that it will act above politics and provide scrutiny and governance mechanisms that are beyond reproach to demonstrate to people of all parties that it is working for the region and not for any one political party?

[David Rutley]

As always, my hon. Friend makes an important point. I absolutely agree. Leeds is a city that I know well and love. We must trust local politicians and civic leaders to do the things that are in the best economic interests of those whom they serve. They need to work closely with local MPs and surrounding authorities to fulfil that potential. Whether in the centre of Leeds, Pudsey or wherever, they must work in the economic interests of local residents.

I feel as if I have spoken for a little too long [Hon. Members: “No!”]. Okay, I will take the next 10 minutes. I know that many people other want to speak, so let me draw to a quick conclusion. The report put forward by Jim O’Neill of the Royal Society of Arts, who is a well respected economist and the city growth commissioner, said that, if we get this right, we will get a 5% improvement in productivity throughout the UK. We absolutely need that and the people whom we seek to serve deserve it.

When the Chancellor first set out his compelling vision for the northern powerhouse, he rightly did that at the Museum of Science and Industry in Manchester: a museum that sets out how the north led scientific innovation and industrial progress. Sadly, too many people find out about our industrial heritage from the Science Museum in south Kensington, which is not exactly the economic or industrial powerhouse. That needs to change. We must not let London lead the whole debate. We are not kowtowing to London and we do not want to copy it or do what it says. We need to compete strongly, show what our commitments are and play to our unique selling points. We have huge potential in the north to set out a compelling and attractive vision for a northern powerhouse by engaging with our local businesses and residents. With the Government’s support, we can go on to achieve even greater things.

[Several hon. Members]

rose—