Levelling Up: East of England

Giles Watling Excerpts

Tuesday 18th January 2022 Westminster Hall

[Peter Aldous]

I thank my hon. Friend for that intervention. Of course, he is right: one of the challenges we face is that, if we do not invest in those communities, there will be a brain drain from the region. It is for that reason that we need to invest in those regions. In that way, we will level up, and get rid of that migration from the region.

As I have said, the east of England is one of three net contributing regions to UK plc, and it should be emphasised that investment and support in our region will not only deliver levelling up but add to national prosperity. Much of the hidden deprivation is focused in coastal areas such as Lowestoft, where traditional industries such as fishing and manufacturing have declined over the past 40 years, although there is hope that fishing can play an important role in economic recovery through the Renaissance of the East Anglian Fisheries initiative. Kirkley, in Lowestoft, is the 26th most deprived ward in the country, and 10 of Lowestoft’s neighbourhoods fall within the 10% most deprived wards nationally. A 2019 study found that more than 12,000 people in Lowestoft and the rural area immediately to its north are affected by income deprivation. Some 20% of households in Lowestoft live on absolutely or relatively low incomes, and 21% of adults in the town have health issues that affect their activity, diminishing their participation in society, limiting their job opportunities and contributing to wellbeing issues. Finally, although 68% of adults in the town are economically active, 15.7% are in receipt of universal credit. That reflects the low-skilled and temporary nature of employment opportunities currently available.

It is also important to highlight one particular opportunity and one particular challenge in the east of England. The opportunity is presented by the UK’s net zero target, with East Anglia right at the forefront of the Government’s plans. Half of the UK’s offshore wind fleet will be anchored off our coast. There is the proposed Sizewell C nuclear power station, and there is the potential to retrofit the gas infrastructure, both in the southern North sea and on land via the Bacton gas terminal. Some 30% of the UK’s low-carbon electricity will in due course come through Suffolk alone. There is potential to completely transform the economy of the whole of coastal East Anglia, where many deep pockets of deprivation are found. To make the most of the opportunity from which the whole of the UK will benefit, the Government need to provide the necessary seedcorn funding. If that is done, we are not just talking about levelling up; we can provide a global exemplar as to how decarbonisation can be delivered to benefit local people and local communities.

A particular challenge that the region’s councils face is adult social care, because the east of England has a relatively elderly population. Following the comprehensive spending review and the provisional local government funding settlement, there is a real worry that one year of funding certainty is not enough. Councils need at least three years of certainty so that they can plan effectively and deliver services efficiently. There is a need for increased long-term funding for councils to close the funding gap that, by the end of 2022-23 for the east of England councils, will be in the order of £240 million. There is concern that the adult social care funding that has been provided is not enough and might not even cover the planned capital on care costs and changes to means testing. Councils face significant financial pressures owing to the rising costs of care, workforce pressures and national insurance uplifts.

I have highlighted the challenges that Lowestoft faces, but I should point out that the Government have responded positively and are currently making a significant investment in the town. Construction of the Gull Wing bridge and the Lowestoft flood defence scheme are well under way, and Lowestoft has secured a towns deal. Work on the projects is due to start later this year.

[Giles Watling (Clacton) (Con)]

Does my hon. Friend agree that although we have infrastructure projects such as the bridge and so forth, when we talk about the anti-car debate in some of the towns, we must remember that some of our leafier suburbs do not benefit and we need transport infrastructure to keep our economy alive?

[Peter Aldous]

My hon. Friend is right that transport infrastructure is vital, and I will come on to that shortly.

Further afield from Lowestoft, the region will benefit from two freeports at Felixstowe and Harwich, as well as the Thames freeport. However, while we await the detail of the Government’s levelling-up proposals, there are some early warning signs that the needs of local communities in East Anglia might be overlooked, and there is a worry that we will not be able to realise the full potential of those projects for the benefit of local people and local businesses.

With regard to funding allocated in the comprehensive spending review, the east of England received the second lowest per capita spend of any region at £92 per head. Only London received less. The UK average is £184 per person, and in Yorkshire and the Humber the provision is £359 per head. In the first round of the levelling-up fund, the east of England secured £87 million. That is £13.88 per capita compared with a national average of £23.91 and £41.72 per capita in the east midlands.

There is also concern about the prioritisation of both the levelling-up fund and the community renewal fund. As I have mentioned, Lowestoft has deep pockets of deprivation, yet it is neither a priority 1 area for the levelling-up fund, nor a priority place in the community renewal fund. It is essential that that inequity is put right ahead of the next round of the levelling-up fund and the introduction of the UK shared prosperity fund.

There is also a worry that, notwithstanding opportunities in the east of England in such sectors as low carbon, agri-tech and life sciences, the Government are actively seeking to discourage Government spending on research and development in the east of England. In the Budget Red Book, the east of England is coupled with London and the south-east, which are very different from much of the region, as an area from which Government spending on R&D will be diverted and where it will be discouraged.

No debate on the east of England would be complete without highlighting the region’s infrastructure deficiencies in traditional modes of transport—road, rail and bus—and digital connectivity. In many ways, we are a victim of our own geography, which in other respects is one of the region’s unique selling points—a relatively dispersed population with relatively small urban centres, and a network of market towns and villages interspersed with attractive countryside—which serves not only as the breadbasket of the UK but as the home to many flourishing rural businesses. If that infrastructure, both old and new, is not upgraded, I fear that the region will not realise its full economic potential and it may be difficult for it to continue to be a net contributor to the Treasury’s coffers.

I will highlight five compelling reasons why we need to upgrade the region’s connectivity. First, the east of England, with 13 ports, including two freeports and four airports—Stansted, Luton, Southend and Norwich—is the UK’s international gateway. If we do not have good road and rail networks from these access points, through and out of the region, it is not just East Anglia that suffers—there will be a negative knock-on impact for the whole UK. Half of the UK’s containerised goods are moved through the region; 70% go to the north of England and support businesses and communities right across the UK. Air freight is critical to maintaining and growing the UK’s ability to trade globally. Stansted is the only London airport with the capacity and infrastructure to support increased demand for cargo aviation over the next 10 to 15 years.

East Anglia’s road and rail network is crucial to the smooth movement of these essential supplies coming into the UK, whether by sea or by air. Poor connections lead to slow, unreliable journeys adding delay and cost, which ultimately the consumer ends up paying for. For this reason, roads such as the A12, A14, A120 and A47 urgently need to be upgraded.

Secondly, linked to this, our railways need to be improved, to accelerate the shift of freight off the roads and improve services to London, to which many of the region’s residents commute. The upgrades at Haughley junction and Ely junction are long overdue. Thirdly, improved transport infrastructure is needed to tackle those pockets of coastal deprivation to which I have referred. Many of these communities have poor transport links without dual carriageway connectivity and with low-frequency train services.

--- Later in debate ---

[Matt Hancock]

I strongly agree with the need for more housing that people can afford, hence the increase in the level of house building from the record lows that we saw in the last couple of decades.

What does levelling up mean in practice? First, it means infrastructure, on which, again, I strongly support everything that my hon. Friend the Member for Waveney said. The improvement to the A14 shows that, in the east of England, we can do it—on time and under budget. That is a magnificent improvement scheme. The A11 needs continued improvement, as do the Fiveways junction and the A1307. The Ely junction scheme has been mentioned. We need to continue the railway from Cambridge to the coast and make sure that, on the Norwich to Cambridge and Ipswich to Cambridge lines, some trains continue directly all the way through to London.

[Giles Watling]

What about the A12?

[Matt Hancock]

I am not an expert on the A12, but I am sure that it is a wonderful road, and I am sure that my hon. Friend thinks it needs improving.

We also need support for enterprise, such as the very successful EpiCentre, in Haverhill, which benefits from being close to Cambridge but is much cheaper than Cambridge. A brilliant company called CodiKoat, for instance, is revolutionising antimicrobial and antiviral coatings. This expansion is necessary.

Finally, in addition to all those points, will the Minister address the need for devolution? Through devolution, we can help to level up. In Suffolk, there is support from the county council, the district councils and all the MPs. That devolution should include the devolution of health, because there is no greater levelling up than in health. By combining health and social care in a devolution deal, we can improve people’s lives as well as their economic prospects. That is what levelling up is all about.

--- Later in debate ---

[Giles Watling (Clacton) (Con)]

It is an honour to serve under your chairmanship, Ms McVey. I would like to thank the hon. Member behind me—pantomime season is over—my hon. Friend the Member for Waveney (Peter Aldous), for securing this incredibly important debate. Yes, the A12 is incredibly important. It is the road that comes to our area—it goes all the way up through Essex—and it is probably one of the worst roads in Britain. I therefore make the plea to whoever is listening that we need that road upgraded, and soon.

We think of the east of England as having wonderful rolling countryside and an incredibly powerful economy, and it does have a powerful economy, as we have heard today. We had this report, “Achieving Sustainable and Inclusive Growth: The East of England Offer”, which was our offer to Government and made the case that some of the most deprived areas in the country are in the east of England. That is despite the fact that Essex, my county, is an economic powerhouse.

Understandably, the Treasury thinks that the east can take care of itself. It can, to a great extent, but we all have issues in our own areas. As we have heard, the east of England received the lowest per capita spend of any region—£92 per person. It is clear that the east of England is not being levelled up as many other areas of the country are. Within the east, we have coastal areas that have intense issues, so if the east is not being levelled up fairly, the coastal areas within the east are suffering even more. The “east” is a deceptive catch-all term for that rich and leafy region.

The east not homogenous. We have far from common levels of wealth. In my constituency of Clacton, Jaywick is consistently and regularly, on many indices, the most deprived ward in the country. That not something I am proud of, and it is not something any of us can be proud of. My local council, Tendring District Council, is working hard and making great strides by purchasing land and building flood-proof houses. However, this problem has been stuck in the mud for so long, and we keep missing out on funding.

I realise that we are short of time, so my plea is: treat coastal areas as the data tells us—they are, in fact, in need of funding, as are many northern towns—and do not just lump us in with the richer parts of the east. When we talk about levelling up, it is vital that we talk about levelling up sideways, as well as up and down.