Jobs and the Unemployed

Debate between John Howell and Jack Dromey

Wednesday 7th July 2010 Commons Chamber

[Jack Dromey (Birmingham, Erdington) (Lab)]

Historically, Birmingham and the midlands was the industrial heartland of Britain. In the 1970s, the regional economy outperformed the national average, but in the 1980s Birmingham and the midlands was blitzed by the effects of the Conservative Government and 200,000 people lost their jobs, overwhelmingly in manufacturing. A proud region paid a terrible price. Sadly, decline has continued since, and the area has gone from being at the top of the league to the 7th best region on economic performance. If my region had matched the UK average on output per head, the regional economy would have benefited by an additional £16.5 billion.

The human cost of that long-term decline starting in the 1980s has been immense. Four of the five most deprived wards in Britain are in Birmingham, 10 of the 20 most deprived wards in Britain are in the midlands and the constituency I am proud to represent—Birmingham, Erdington—is the sixth most deprived in Britain. The statistics are stark and so, too, is the appalling human price that I see day in, day out in my constituency. Birmingham and Erdington both believe in a tradition of self-help, but the problems we face are incapable of resolution, other than through the role of good government. The role of government is not to wash its hands of responsibility for the unemployed, because that is a Pontius Pilate approach towards those who need the help of government.

I wish to focus on Advantage West Midlands, which is the most successful regional development agency in Britain; the National Audit Office’s recent report gave it a rating of four out of four, and for every £1 of public money spent, the regional economy benefits by £8.14. AWM is a constantly improving RDA with an outstanding track record. Sir Rod Eddington’s transport study said that its work on transport infrastructure was the best in Britain. The Treasury review of June 2009 said that AWM was the most cost-effective RDA in Britain. I have seen at first hand the power of its work. I remember that when Rover was saved from closure in 2000, it was thanks to what AWM did in diversifying the supply base that when Rover tragically went under in 2005, tens of thousands of jobs that would have gone in the supply chain in small and medium-sized enterprises were preserved. I, too, experienced that terrible day when 5,000 workers lost their jobs at Longbridge. Advantage West Midlands swung into action immediately, and in nine months, by way of effective programmes, 4,000 of those 5,000 workers had been found alternative employment.

The transformational change has been remarkable. The development of the Longbridge innovation centre and Bournville college has meant 10,000 new jobs and 1,450 new homes. The development of our regional infrastructure, with the New Street Gateway, the single-biggest investment by any regional development agency, involves £100 million of public money, but it levered in £2 billion of private sector investment, with enormous economic benefits, including 10,000 more jobs.

There have also been solutions for business. Since 2002, 5,000 manufacturing companies, overwhelmingly small and medium-sized enterprises, have benefited from the world-class advice of the Manufacturing Advisory Service, adding £150 million to their turnover. It is little wonder, therefore, that the midlands business community strongly supports Advantage West Midlands. The voice of the business community, Business Voice WM, having consulted its members in June, said to the Government, “Do not abolish the regional development agency. An intelligent debate about change and reform? Perhaps. But do not abolish the regional development agency.”

[John Howell]

How much of Advantage West Midland’s programme reflects the wishes of local councils, rather than those of central Government?