North-East Independent Economic Review

Debate between Ian Swales and Chi Onwurah

Thursday 5th September 2013 Commons Chamber

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

I congratulate my neighbour, my right hon. Friend the Member for Newcastle upon Tyne East (Mr Brown), and the Backbench Business Committee, on securing this important debate. The focus of my contribution will be on skills.

I grew up in Newcastle in the ’60s and ’70s, a city and a region that valued engineering—making and building things. I remember the late Baroness Thatcher telling the country that engineering and manufacturing were the past. It was that relentless pursuit of a service-led economy that saw the level of employment in the north fall by 1.3 million between 1979 and 1987. The associated devastating impact on our communities is still felt today. It is not good for the north-east, or the UK as a whole, to have a deep and growing divide. A one nation economy needs an innovative and dynamic north-east. The region already has world class institutions, businesses, universities and of course people, not to mention—and they have already been mentioned—countryside and culture. As we have heard, we lead the way in exports and are increasingly becoming a centre for hi-tech and digital businesses. There is no better place to live, work or innovate.

The report found that we need an additional 60,000 private sector jobs to provide a balanced and sustainable economy, and that those jobs must be highly skilled and highly paid if we are to compete and prosper. That is a challenge I know the region is up for, given the right resources. In the decade between 1998 and 2008, as my right hon. Friend mentioned, and with the support of the regional development agency, the region added 67,000 jobs, many of them in the private sector. It is right that the seven north-east councils have come together to form a new combined authority. I look forward to working with it and the LEP to improve the skills landscape across the north-east. I welcome the North East LEP piloting a new skills development funding initiative, which will mean a greater say on skills funding in the region.

The report calls for a doubling of youth apprenticeships. If that is to be achieved, Ministers must allow more power and resources for skills to be devolved. If the Government are serious about localism—the evidence so far is not good—then Ministers have an opportunity to devolve significant power to the combined authority. Building the new economy that we want for our region requires an effective partnership between the public sector, the private sector and higher education, and it is vital that the structures are in place to support them. Unlike London, the devolved nations and even Manchester, the north-east has had no collective voice since the RDA was abolished to shout out our strengths or focus on our weaknesses. I, too, echo the desire of my right hon. Friend for a regional Minister.

The combined authority should have real power, knowledge and legitimacy over those in Whitehall who currently make decisions for our region. It must also have the resources. Structures are not enough—it needs the resources to build the new innovative regional economy that is set out in the report.

[Ian Swales]

Does the hon. Lady feel that extra power and resources should be focused on a group of politicians or on the public-private partnership—in other words, the LEP?

[Chi Onwurah]

The resources should be focused on our region. The partnership between the LEP and the combined authority should take control, as much as is possible under current structures, of our region’s future.

As we have heard, the fact that the Government have taken so much out of the region—£100 million has been taken out of Newcastle city council’s budget alone—does not make the task any easier; rather, it makes it much harder. What would help is control over the valuable European funds that are directed to the north-east, to ensure that they go to where they are needed. One area where the report falls down is in ignoring the importance of culture, inclusion and community. The people of the north-east are the north-east. They are an asset beyond a mere skills base. That is why the European social fund, currently administered by the Department for Work and Pensions, which focuses on extending employment opportunities and developing skills should be devolved. I understand that the DWP will match the fund only if it can control it. If that is the Minister’s idea of localism, it is certainly not mine.

There are too many people in the region who are too far from the jobs market to take advantage of the high-skilled economy that we want to build. Councils and industry in the north-east are showing the kind of leadership that we need, by working together—at long last, one might say—to form a new authority that will work with the LEP, universities, businesses and people.

Unemployment (North-east)

Debate between Ian Swales and Chi Onwurah

Wednesday 20th June 2012 Westminster Hall

[Ian Swales]

I have hardly started. I will give way in a moment, when I have got further into my speech.

Solutions to the problem have to be bottom-up and top-down. My local council—before an Opposition Member points it out, it is a Labour council—deserves praise for its infrastructure work, adding new seafront work and leisure investment to the huge Environment Agency spend on flood defences, as well as the Government investment in MySpace, which is going on in Redcar. It was good to see the Association of North East Councils visiting Redcar a few weeks ago to see what is happening. However, it is disturbing how many of the construction jobs are not going to local people. I have raised that with the council, because it is important for the north-east to help itself as much as possible and not to have such jobs going to people who travel into the area. My local council is taking a high risk, however, because the Audit Commission says that at the end of the work it will have the highest debts in the country for the size of the council, but at least it is doing something.

I praise the Government for investment in local infrastructure, in the Teesside railway system and, in particular, the recently announced refurbishment of stations, including all six in my constituency. House building is obviously a good option, but in areas such the one I represent the population is static or declining. We need to upgrade our housing stock. That is true throughout the north-east, but as I keep reminding my council, if we do not plan for the overall stock we get market failure. That has already happened in three parts of my constituency: South Bank, Grangetown and West Dormanstown.

We need a lot more focus on enterprise by our councils. I cannot speak for other areas, but my local council of Redcar and Cleveland often proves to be difficult to deal with. We recently lost 200 jobs when a potential new investor simply gave up and went somewhere else. I welcome the new enterprise zones, including three in my constituency, which are already attracting interest. I hope that we will prove to be easy to deal with and get companies into those zones.

These debates always lead to a lament for the RDA at some point, and the hon. Member for Hartlepool has already touched on that. It is interesting to note that, in a sense, RDAs were not a regional policy; they covered the entire country and all got large sums of money. I salute the bravery of the present Government in supporting only projects in hard-pressed areas such as the north-east with the regional growth fund. That is one reason why the north-east is getting a large share of the regional growth fund money.

[Chi Onwurah]

The hon. Gentleman says because all the RDAs were abolished, the abolition of One North East was not a regional policy. As a member of the Liberal Democratic party, however, does he not agree that his party stated specifically that One North East would be saved, because it was admired by both public and private sectors? Its demise has been regretted ever since its abolition.

[Ian Swales]

That was never party policy, but it was a remark made by the Business Secretary. I think everyone recognises that One North East was the best of the regional development agencies. My point was that giving money to every region will not rebalance the economy. I salute the bravery of our Government in not giving money to regions that do not need help.

A month or two ago, I said in this Chamber that in the two years before the general election, the RDA approved 96 projects, worth £148 million, in which One North East directors had to declare an interest. Of those, only eight projects and £6 million related to the Tees valley. The Tees valley got a poor deal from One North East. Experian assessments place Hartlepool, Middlesbrough, Redcar and Cleveland in the weakest 10 economic areas of the country, so I welcome the local enterprise partnership and its work.

The LEP is doing a lot of good work, part of which is defining clusters—we have process industries and automotive clusters, and we are now developing a steel cluster. The welcome news is that Sahaviriya Steel Industries has bought the Redcar steelworks, and is now producing; Tata is still in the area, and opened a new research centre just two weeks ago, which had some Government support; Siemens has its worldwide centre for steel processing development in Stockton; and Teesside university is opening up a new department, so a good cluster is developing there. We also have clusters in green technology, and I welcome new initiatives in renewables, with the industry forming the Energi Coast group—20 companies getting together to exploit the new market jointly—and Narec has been included in the new technology innovation centre for renewables. Clusters attract like-minded companies. Global Marine Systems has just relocated from Essex to Middlesbrough, and last month it hired the Riverside stadium to recruit people.

Manufacturing is having some success in the area. International trade is booming with record exports— the best ever—from the region during the 12 months to March, including 20% growth in exports outside the EU. Jonathan Greenaway, a partner at PricewaterhouseCoopers in Newcastle, recently reported those successes and said:

“This is a great time of opportunity for manufacturers, and…UK companies are really rising to the challenge.”

We have some problems with the public sector, to say the least, with job losses and so on. I believe that taxpayers expect efficiency in public services and that they do not see them as job creation exercises, but there has been a worrying trend of relocation of jobs, certainly out of the Tees valley. Under the previous Government, the ambulance service was lost—it still baffles me that an area of 750,000 people is not deemed capable of running its own ambulance service, but that was moved out of the area. We also lost the office of Her Majesty’s Revenue and Customs in Middlesbrough, and thus 400 jobs. There are other potential problems, such as the Insolvency Service office in Stockton. I urge the Whip to reverse that trend and to move jobs to hard-pressed areas in the north-east such as Teesside.

I note that some agencies are looking at Yorkshire and the north-east as a region. I point out to them that the Tees valley is exactly the midpoint—I measured it this morning—and an ideal location for headquarters. The regions are massive, however: Sheffield in South Yorkshire is as close to Southampton as it is to the constituency of my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith).

For 13 years, the north-east had a Labour Government—almost all MPs and councils were Labour—but between 1997 and 2010, the number of unemployed people in the region went up by 7,000, and the rate remained approximately the same, despite the unprecedented amount—

Health Inequalities (North-East)

Debate between Ian Swales and Chi Onwurah

Tuesday 24th January 2012 Westminster Hall

[Ian Swales]

I believe that the wider issue of NHS reforms is outside the scope of this debate, but certainly I see a growth in the number of GPs already.

[Chi Onwurah]

rose—

[Ian Swales]

I am not giving way again on that subject.

As the hon. Member for Easington (Grahame M. Morris) said and as we all know, many factors are involved in health inequalities: smoking, alcohol, obesity, housing, income and others. Sadly, the area that I represent has the worst rate or one of the worst rates of obesity in the country, and one third of my constituency is in the poorest 10% of most deprived wards, so I am well aware of how these things operate in the local area.

In the public health area, we should, as the hon. Member for Newcastle upon Tyne Central said, celebrate a great success and learn from it. The Fresh organisation has had a great impact in terms of smoking reduction. The rate in the north-east went from 29% in 2005 to 22% in 2009. I also find this hard to believe, but apparently males in the north-east have the lowest rate of smoking in the country. It was probably the highest at one time, but apparently it is now the lowest. That shows that effective public health action and education can have a big impact. Models such as that, in which innovative third sector organisations focus on change, can assist with this important job, which is a lot about behavioural change.

As well as successes such as the one that I have described, I welcome the increased spending in the NHS by the previous Government. That has increased health outcomes for all, regardless of the fact that it failed to narrow health inequalities. My area has seen the setting up of excellent facilities such as the James Cook university hospital. As has been mentioned, there is also the data gathering, which is so important in learning how to deal with these problems.

There is still a lot to do. In my constituency, there is a 16-year gap between the life expectancies in the richest and poorest wards. I therefore welcome local health commissioning, which will lead to a more joined-up approach to local issues. An excellent pathfinder GP group is already up and running in Redcar; in fact, it was running as a social enterprise for five years before the recent reforms were introduced.

I welcome the public health agenda and the fact that the budget will go to local authorities. I also welcome the setting up of health and wellbeing boards, although we will have to watch how the money is spent to ensure that the maximum amount gets to the front line. Similarly, I welcome the proposed establishment of Public Health England, which will have the specific aim of reducing health inequalities.

Even more study is needed into, for example, the psychological aspects of why people choose lifestyle options they know to be harmful. Recent research clearly shows that many social problems, including the one we are discussing, stem from income inequality, not from absolute levels of income, and some interesting data are emerging. Sadly, income inequality also widened under the previous Government.

The new Government have made a start, but there is much more to do, and I look forward to the Minister’s comments.