Shared Prosperity Fund

Drew Hendry Excerpts

Tuesday 14th May 2019 Westminster Hall

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

It is a pleasure to serve under your chairmanship, Sir David, and I congratulate the hon. Member for Barnsley Central (Dan Jarvis) on securing this important and timely debate. We have all been waiting far too long for details on this matter. The hon. Gentleman spoke about looking through the eyes of communities, and his challenges to the Minister were repeated by many others in the Chamber. We must respect the devolved Parliaments and ensure that badly needed regional aid is in place. The hon. Member for Coventry South (Mr Cunningham) intervened to speak about the dangers of listening to who shouts the loudest, and of pork barrel decision making.

The hon. Member for Barnsley Central mentioned data from the conference of peripheral maritime regions—I must declare an interest because, as a former leader of Highland Council, I am a former vice-president of that body—and the data were very detailed. He highlighted €895 million for Scotland in this spending round, including €180 million for the highlands and islands. For the Minister’s benefit, I remind hon. Members that both that country and that region voted in great numbers to remain in the European Union.

The hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) spoke about the funding being used to challenge depopulation, as well as other issues that have gone unaddressed by Westminster Governments for many years. Indeed, one symbol of European funding joins our two constituencies. After decades of no or little investment in the highlands and islands, the Kessock bridge that now spans our constituencies was made possible only by EU funding—something people in the highlands are very much aware of.

The hon. Member for Barnsley Central spoke about supporting the most vulnerable, and he mentioned the need for regeneration and business support, and the low-carbon agenda that comes with such funding. In response to an intervention, he recognised that people are becoming desperate for information, which is true—people are desperate to find out where such support will now come from. The devolved Administrations must be told what the money will be, how it will be used and how it will work. Currently, they do not have clarity about how much money there is, when it will be allocated and to whom, or how the system will work.

The hon. Gentleman spoke about the guiding principles of there being no less money than already exists, that the regions must not be worse off and that the system should be fully devolved. This funding must go beyond parliamentary cycles and spending reviews.

[Stephen Kerr (Stirling) (Con)]

Will the hon. Gentleman give way?

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[Drew Hendry]

I will not as there is not much time and I have a lot to say.

The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) spoke about Westminster’s failings, and the feeling in his communities about Westminster’s trickledown economics. He mentioned the benefits of EU funding in education, jobs and innovation, and said that his area requires not a penny less than was promised. There should not be a power grab. That would not be acceptable to the people of Wales, or indeed of Scotland.

The hon. Member for East Renfrewshire (Paul Masterton) took great pains to try to support his Government—he even had to call for them to move on—and raised concerns about this being an England-only fund. For different reasons, I have the same concerns, because if we look back into history, we see what happened in the highlands and islands before we were members of the European Union.

The hon. Member for Ellesmere Port and Neston (Justin Madders) said that this must not be a Westminster handout on Westminster terms as that will not cut it, and I completely agree. The hon. Member for St Austell and Newquay (Steve Double), along with other Members from Cornwall, seemed to argue that European funds have somehow been negative for the area. I know they were talking about the details, but I think people will find that hard to understand.

The hon. Member for Leigh (Jo Platt) spoke about the imbalance of investment, and said that for too long Westminster had held the purse strings and the power. She is absolutely right, and that must be respected when the scheme is introduced. Although the hon. Member for Strangford (Jim Shannon) and I do not agree on everything, he said that this funding must be devolved and at the same level as before, and he listed the improvements that have been made in his constituency with EU funding.

The hon. Member for Ogmore (Chris Elmore) spoke about how funding matters in his community, and how important it is across Wales, including the fact that it is devolved. This scheme must not be used as an opportunity to rewrite the devolution settlement; devolution must be respected. The hon. Member for Aberavon (Stephen Kinnock) repeated the call for this not to be a power grab. It will not surprise you, Sir David, to hear that I agree with that sentiment.

Communities and charities have been waiting years to find out what funding will be available post Brexit, and we urgently need the details of this so-called prosperity fund. Since joining the EU in 1973, Scotland has benefited from European structural fund money to the tune of billions. Those funds have been used to support getting people into work and out of poverty, to improve their education and skills, and for investment in our infrastructure and communities. The European regional development fund promotes balanced development across the EU, and the European social fund invests in employment-related projects.

The Ministry of Housing, Communities and Local Government has repeatedly promised to publish full details on the consultation. On 15 November 2018, Wales Office Ministers told MPs that a full consultation would be published before the end of the year. We are six months on, and there is nothing to be seen. If Brexit is drawing the Government’s business and long-term planning to a halt, they should revoke article 50—not the concept of long-term planning.

I do not have much time and I want to make sure that the other Front-Bench speaker and the Minister have the opportunity to contribute, so I will wrap up with these words, although there is much more I could say on this subject. Where is the post-Brexit funding? Communities and charities want to know where it is and they need the details urgently. When is it to be revealed? Will it respect the devolution settlement and prove not to be just another power grab?

It is not good enough that this Government are tied in knots and uncertain of the future. If the UK Government’s long-term planning has ground to a halt, they must get past that and get the details to people and communities of how the money will be distributed. We already know that Brexit will cost Scottish communities millions, so they need details on funding urgently. Our people cannot be left behind by a Government who are too chaotic to get out the details of how they will support communities.

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[Jake Berry]

As the hon. Gentleman knows and I was just about to say, the quantum of the UK shared prosperity fund will be determined as part of the comprehensive spending review. That is the appropriate time for the Government to make commitments of the sort he seeks. However, he and the hon. Member for Aberavon (Stephen Kinnock) are correct that the Government must come forward with their consultation—I am clear that this must happen—before the comprehensive spending review to enable areas to contribute to that consultation.

We have not been sitting on our hands, as people who have listened to the debate may think. We have already engaged with more than 500 stakeholders. We have had 25 official-level engagements across the country, including with our counterparts in the devolved Administrations. In addition, in my role as Minister for the northern powerhouse, I have engaged with mayors. I have talked to them specifically about how we can work together to provide evidence to the consultation that demonstrates that, as so many people have said, the impetus for investment of the UK shared prosperity fund should come from our regions rather than being directed out of Whitehall.

Having listened to contributions to the debate, I think everyone believes that it would be nice if that happened. The point is that by working with our metro Mayors, our local enterprise partnerships and authorities across England—that is certainly my role as English Minister for local growth—to create the evidence base, we can move beyond thinking that it would be nice to proving that it is how we will get the biggest return on investment. There is work ongoing in my Department, in advance of the consultation, to ensure that that hugely important argument is made, and won, when my dear chums in the Treasury are making decisions about how the money should be distributed following the consultation. I hope that answers some of the questions that Members asked. My response to the main question is that the consultation will start very shortly.

Let me move on to some of the specific points that were made. On public transport investment, Members may not have seen the most up-to-date figures, which are available on the Treasury website. They show that transport capital expenditure is higher per capita in the north of England than in London. People often talk about total capital expenditure across the north of England versus London. There are some parts of the north of England where very few people live, so it is much more realistic to talk about capital expenditure per capita, and it is higher per capita in the north of England.

Many colleagues talked about the weakness of Green Book calculations for making investment decisions, which I think is acknowledged across the House. That is why the Government came forward with a rebalancing formula in the industrial strategy. That formula looks at areas that are less developed, depending on how we define that, and at factoring future growth into Green Book calculations. Changes have been made recently to ensure that community benefit is also included in such calculations.

My hon. Friend the Member for Newton Abbot (Anne Marie Morris) commented on the ring-fencing of coastal money. By the end of the current spending period, the Government will have invested £200 million directly in coastal communities through our coastal communities fund, which is about driving prosperity on our coasts. The UK shared prosperity fund must not be viewed on its own as the only support the Government give to drive regional growth. We have contributed £53 million to part of the exciting growth deal in the highlands and islands, which has resulted in things such as the north coast 500 route, which I hope to visit this summer, prospering.

[Drew Hendry]

rose—

[Jake Berry]

I will let the hon. Gentleman advise me about the best place to stay.

[Drew Hendry]

I am grateful to the Minister for raising that money for the Inverness city region deal. Will he go a step further and match 50:50 the commitment of the Scottish Government, who put considerably more money into that deal than the UK Government did?

[Jake Berry]

We will have to look at how much new money the Scottish Government have committed. Since we have talked repeatedly about devolution, particularly from a Scottish viewpoint, I note that the Smith commission agreement, which was signed by all parties in Edinburgh, contains a commitment by the Scottish Government to look at further devolution to local councils in Scotland. Devolution does not stop in Edinburgh, but I understand that no progress has been made on that.

I could go on, and I would like to, but I want to give the hon. Member for Barnsley Central the customary time to conclude the debate. I hope that colleagues do not doubt the Government’s commitment not just to devolution, but to regional growth. The UK shared prosperity fund, which we will consult fully on shortly, will continue that commitment to driving productivity and growth everywhere.