Infrastructure (Financial Assistance) Bill

James Morris Excerpts

Monday 17th September 2012 Commons Chamber

[James Morris (Halesowen and Rowley Regis) (Con)]

I support Second Reading. It has become a cliché to say that, in terms of the global economy, the world is getting smaller. Modern communication technologies and better transport links have made it relatively simple to do business across the world. It is therefore a sad irony that in our national economy, the gap between the south-east and the rest of the country has, in many ways, grown wider.

Like the rest of the west midlands, the black country, part of which I represent, enjoyed little benefit from the artificial boom that the previous Government created. Gross value added in Dudley and Sandwell fell from 88% of the national average in 1997 to just 74% in 2008. While Labour’s boom may have passed the west midlands by, people and businesses in the black country certainly felt their share of the pain caused by Labour’s bust.

As we work towards recovery, it is essential that we address the regional imbalances that have held back large parts of the country, preventing the economy from achieving its full potential. As the Prime Minister said, we cannot afford to rely on just a few industries and a few regions. I believe that the Bill will help create the essential infrastructure that we need to unlock private investment and help transform our regional economies.

As Dieter Helm of Oxford university wrote in 2009:

“Few would choose to locate in Britain because of its infrastructure”.

Professor Helm went on to describe Britain’s infrastructure as

“not fit for the digital age”.

Addressing that obstacle to growth in the context of the overriding need to tackle the record deficits built up by the previous Government is key to getting the economy back on a sustainable path. In particular, we need measures to stimulate investment in the transport infrastructure that will bring our cities closer together and closer to business centres overseas.

As someone who has set up businesses in London and who now works closely with businesses in the west midlands, I know from personal experience that too great a premium is placed on businesses being based in London. For many new businesses, and particularly for inward investment in Britain, London almost becomes a default location because of the proximity to major clients and the ease of travel to major cities abroad. Overseas investors are much more likely to invest where there are global links relevant to their businesses. If we want to rebalance our economy, we need to make sure that those global links are easily accessible from our regional centres.

The media recently got worked up about whether London needs greater airport capacity and where it should be. I recognise many Members feel very strongly about that, whichever side of the argument they may take. However, for many of my constituents—and for the businesses I meet—the issue has very little relevance to them, their jobs and the future of their companies. By focusing so strongly on Heathrow and other London airports, we risk giving the false impression that London is the sole gateway to Britain.

Instead, we should invest in transforming our regional airports into world-class facilities, linking our major cities with business opportunities around the world. I know that my hon. Friend the Economic Secretary will recognise the importance of Birmingham international airport to the west midlands region, mid-Wales and parts of the north-west.

The Bill would allow for the fiscal credibility achieved by the Government’s policies to be used to support major infrastructure projects of national significance. Without wishing to put words into the Minister’s mouth, I can think of few projects that would be of more truly national significance than the expansion of international air services at Birmingham airport. Building a second runway there would increase spare capacity at Birmingham to 50 million passengers a year.

In the short term, that project could be expected to create or sustain 50,000 jobs, providing a significant boost to the construction sector and associated industries. In the medium term, by acting as an additional hub airport, it would help relieve some of the pressure on Heathrow. Most significantly, it would transform the midlands as a place to conduct international business, creating effective and efficient transport links to emerging markets around the world without the need to go via London.

High-speed rail will help bring our major cities closer together as places to do business, linking the midlands with London, the north-west and Yorkshire to build a network for growth. Expanding Birmingham airport would connect that network to markets around the world, making the midlands a more attractive place to do business and helping address the regional imbalance that has held back the economy for far too long.

I know that Members of all parties will have their own priority projects—schemes that could make a big difference, but are being held back by lack of credit. The Bill will make it possible to unlock private investment in the projects that our communities and our economy desperately need. It is hard to imagine a more worthwhile use of the benefits gained from the hard work of tackling the deficit—and hard to imagine a greater contrast than with the Labour party’s commitment to over-tax, overspend and over-borrow. While Labour Members’ dogmatic attachment to the failed policies of the past would lead to higher interest rates—hurting businesses and families, and making it even more difficult and expensive to secure credit for investment—the UK guarantees programme uses the resources and economic credibility of Government to underwrite essential investment and support exports.

I am pleased that the Government have decided to fast-track the Bill so that the measures can be implemented and the benefits delivered quickly and effectively, and I am glad that the Opposition will support the measure. Our constituents will not look kindly on those who choose to put political posturing ahead of this much-needed action to boost the British economy.