Department for Education Offices (Runcorn)

James Gray Excerpts

Wednesday 17th April 2013 Westminster Hall

[Derek Twigg (Halton) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Gray. I do not intend to take all the time that would normally be taken in such debates, as the hon. Member for Weaver Vale (Graham Evans) has a key interest, because his constituency is affected. Therefore, I will cut down the time I have to speak.

[Mr James Gray (in the Chair)]

That will be quite in order with me, as long as the hon. Gentleman has the permission of the Minister to do so.

[The Parliamentary Under-Secretary of State for Education (Elizabeth Truss)]

indicated assent.

[Mr James Gray (in the Chair)]

In that case, that is fine.

[Derek Twigg]

The Department for Education announced on 13 November 2012 its intention to close Castle View house in Runcorn, which is owned by the Department as a freehold property. It proposes to transfer the work to Manchester. The Runcorn site accommodates 450 staff, including 222 Department for Education staff, private sector support staff, staff from other Departments—including the Department for Work and Pensions and the Department for Business, Innovation and Skills—and staff from the Children and Family Court Advisory and Support Service, and national health service procurement staff. Civil service jobs—originally with the Department of Employment—have been based at the site, and previously at the building next door, for more than 40 years, providing an important source of good-quality jobs in the borough of Halton.

The Department has identified the following key areas on which to test its proposal: cost and value for money, needs of the business, estates policy, the effect on staff and the wider socio-economic impact. I will address each area individually, but first, what about the overall handling of the issues by the Department for Education? There was no business case on which to justify a closure, and it was made clear to staff from the beginning that it was highly unlikely that the proposal would be changed, despite a consultation being launched later. Even when I, the hon. Member for Weaver Vale and David Parr, chief executive of Halton borough council, met the DFE permanent secretary to discuss the proposal, we came away with a view that the decision was a fait accompli.

I am sure that most independent-minded people would find it odd that there was no business case to base the proposal on. The key arguments made for closure and transfer of the work to Manchester do not remotely stand up to scrutiny, as I shall argue. It is fair to state that the staff and unions have believed for some years that there has been an agenda in the senior management to close down the Runcorn operation for reasons that we could never get to the bottom of. I think the DFE wants the closure now because it fits in with the image that it wants to project of being ahead of the game in Whitehall on how to cut costs, and, therefore, it will be held up as a template for other Departments. The problem for the Department for Education is that the change will not save the taxpayer anything.

In terms of cost and value for money, of the 12 DFE sites, Castle View house is the second least expensive. The cost per person for Castle View house is £2,545. The cost for Piccadilly Gate in Manchester—the building that it is proposed to move the jobs to—when comparing like for like is £4,583 per person. The Department suggests that the refurbishment of Castle View house would cost £500,000. A qualified property survey carried out by Halton borough council suggests that the figure would be nearer to £30,000 to £50,000, depending on whether decoration was undertaken. Castle View house is a modern building with excellent facilities and good IT infrastructure. The Department did not factor in the income from sub-tenants in the figures that it based its original closure proposals on.

I have also been informed today that the Public and Commercial Services Union met the Department on Monday in London to talk about staff relocation costs. The DFE has now accepted that it will have to support Runcorn staff with travel costs of up to £4,250 each year—a significant increase, I understand—to cover travel costs on other, longer routes than the very congested Runcorn East line.

We have not yet seen all the Department’s figures for relocation. The Manchester building that the Department is proposing to move staff to will be demolished as a result of High Speed 2, as I am sure the hon. Member for Weaver Vale will point out, incurring more cost for the taxpayer. Further, we can add to that the cost of running an empty building when a re-let is unlikely, according to Halton borough council, in the short to medium term. The DFE already has an empty site next door to Castle View house.

Let us consider the business need. The suggestion was that Manchester had a wider-ranging skills base, but that has not been evidenced or tested other than by the fact that a number of other Departments are based there. Similarly, the assertion by the DFE that Manchester would attract better staff is flawed—again, where is the evidence? The Runcorn site offers a range of skilled staff, holding degree-level and professional qualifications. The public communications unit at Runcorn offers a centre of excellence. A skills audit by the PCS of its members showed that, among the staff who responded, 139 professional qualifications were held.

It is accepted that Manchester has very good travel connections, but it is quicker to travel to London from Runcorn. There are also local lines to Liverpool, Manchester and Chester. The M56 is only a few minutes from Castle View house and also gives quick access to the M62 and the M6.

On being able to attract and retain good-quality staff at Runcorn, we have only to look back to the heyday of the Runcorn site in the 1980s and early ’90s, when nearly 1,000 staff were employed there. That is a clear indication that staff with good skills can be attracted.

I want to examine the effect on staff. It goes without saying that the morale of this loyal and hard-working work force has been badly affected by the proposal, but also by the way the Department has handled it. The closure of Castle View house will also impact more on the lowest-graded and lowest-paid staff, and those who are made redundant will find it hard to get another job, given the high unemployment in Halton.

The PCS union met departmental officials and representatives of Arriva Trains on 30 January. Arriva has confirmed that it cannot transport the required number of staff from Runcorn East station to Manchester at peak times. I understand that the Department has now accepted that and informed staff that it will explore “alternative options”. There are also few parking spaces at Runcorn East, where staff would travel from. That is a particular concern for disabled staff. A number of staff who live in Halton would have to make two bus journeys to get to the station.

On the socio-economic impacts, Halton is the 30th most deprived borough in the country and the areas that fall within the Halton Lea ward are some of the most deprived in England. Youth unemployment is particularly high in the area. There will be a wider impact on Halton through the largely retail-based employment in Halton Lea, which was known as Shopping City and which relies on the employee daytime population. Castle View house and those employed there are an important source of custom. Therefore, if employment is removed from the Halton Lea ward, wider employment in the ward will suffer. The wider impact on Halton will be worsened by the fact that a large proportion of Halton Lea’s work force live in Halton.

It is important not to forget that Halton Lea is a town centre, not just a shopping centre, and the Government have stated that they want to regenerate town centres. I hope that, when coming to a decision, the Minister will ensure that account is taken of wider Government policy on town centres.

It is important to highlight to the Minister the fact that support for retaining the DFE jobs from both the private sector and the public sector is very strong. That includes Halton borough council, the Liverpool City Region local enterprise partnership—I am pleased that my right hon. Friend the Member for Knowsley (Mr Howarth) is present for the debate—and Halton chamber of commerce.

To summarise, Castle View house is much cheaper to run than the Manchester Piccadilly Gate building. Closing the MPG building would save the DFE more money than closing Castle View house. Closing Castle View house would be an ongoing liability for the DFE. Staff at Castle View house would find it harder to find jobs in the locality. Closing Castle View house puts in jeopardy the other 200-plus non-DFE public sector jobs based there. The socio-economic impact on Runcorn and on the viability of Halton Lea shopping centre will be serious. There are serious issues about Runcorn staff being able to travel to Manchester and about the associated costs.

If, despite what is being said today, the Minister goes ahead and closes the DFE offices in Runcorn, I intend to write to the Chair of the Public Accounts Committee, my right hon. Friend the Member for Barking (Margaret Hodge), to ask whether her Committee will investigate a decision that is obviously a waste of public money.

I am pleased that the hon. Member for Weaver Vale and I had the chance to meet the Secretary of State on 15 January—I am grateful to him—so that he could hear our case against closing Castle View house. I hope that the Minister will now go back and discuss with him the facts of the situation, which are unarguably weighted against the Department’s proposal to shut Castle View house.

--- Later in debate ---

[Graham Evans]

Is my hon. Friend aware that Halton borough council has suggested several alternatives to the existing building, based on the consultation? I do not agree with this, but it says that the proposal it is not economic; it is the most expensive option. There are various alternative locations in my constituency that have been put on the table—Rutland house, Vale house, Howard house, Clifton house—so there is no shortage of public sector properties available in Halton. It does not have to be shifted out of the community of Halton Lea to Manchester Piccadilly in Greater Manchester; it could be kept within the community, as there is no shortage of alternative buildings.

[Mr James Gray (in the Chair)]

Before the Minister replies, it might be helpful for hon. Members to know that we expect a Division in the main Chamber, possibly at 7.15 pm or earlier, so we might tailor our remarks to suit that probability.

[Elizabeth Truss]

I thank my hon. Friend the Member for Weaver Vale for his comments, and I am aware of his proposals. We are absolutely considering all available options in the north-west in relation to our package. I understand that both speakers have acknowledged that there is essentially a choice between Runcorn and Manchester. They have put forward a good case about why Runcorn has particular issues of staff quality, employment levels and local regeneration that need to be considered in the decision-making process.

The decision to close any Government site is never easy. I understand the worry and uncertainty of staff who might be affected by the decision. It is a difficult time across the Department when there is such uncertainty. I also understand the concerns of the local community in Runcorn about the site’s future. The consultation is open, but we wanted to be honest about our initial intentions, so that people have time to make representations and preparations.

I acknowledge the points made about the economic impact on the area. Among the factors that we will take into account in our decision are wider central Government policies—for example, the town centre policy that the hon. Member for Halton mentioned—and minimising costs for the Department, which is clearly important to the achievement of value for money. I note the point that both hon. Members made about the availability of more affordable sites in the Runcorn area.

Whichever site is selected for closure, we will put in place comprehensive support for affected staff to help them through the change. All staff will have the option to transfer to work from whichever site is chosen, and we will offer assistance with excess fares. However, for those who either cannot or do not want to make such a move, we have already made a commitment to allow staff to apply for voluntary terms, and we are working with local recruitment agencies and other Government employers in the region to identify alternative employment opportunities.

I shall respond to the specific issues raised in the debate. Following the further representations about cost, vis-à-vis Manchester and the local economic situation, I confirm that they will be taken into account in the final decision. I shall ensure that I discuss the important points made in today’s debate with the permanent secretary and the Secretary of State. The decision is being deliberated on and I alert hon. Members to the fact that we expect it within the next two weeks.

We did not say that Castle View house would cost £500,000 to refurbish. We were talking about bringing it up to the same standard as Manchester Piccadilly Gate. I completely understand the point that the hon. Member for Halton made about alternative accommodation being available in the Runcorn area. We are aware that High Speed 2 could mean that Manchester Piccadilly Gate will be demolished, but that is subject to consultation, and plans suggest that demolition would not be required before 2027, which is after the lease on the Manchester Piccadilly Gate building ends. We will consider the impact of High Speed 2 as part of our deliberations.