South-west England (Long-term Economic Plan)

Marcus Jones Excerpts

Wednesday 8th July 2015 Commons Chamber

[The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Marcus Jones)]

I congratulate my right hon. Friend the Member for North Somerset (Dr Fox) on securing this important debate. I welcome the interest from hon. Friends across the south-west. There is a slight show of strength from the region here tonight—probably the only constituency not represented is Exeter. I very much feel that I have been on a tour of the south-west. I am sure that colleagues in the Department for Transport and the Treasury—the Chancellor’s Parliamentary Private Secretary is here—will read Hansard intently to see what my right hon. Friend and other colleagues have said. I will try to answer as many of his points as possible in the short time remaining.

The Government’s economic ambition is to create a fairer and more balanced economy by supporting policies that grow the economy and generate new jobs and higher wages for everybody. In our election manifesto, we said that by attracting growth and new businesses we will improve connections to the south-west, with major investment in the road network and electrification of the Great Western main line, bringing new fast trains on to the route. We will increase the number of overseas visits to the south-west each year by investing in tourism. We will ensure that the world-class defence assets and cyber-security industries of the south-west benefit the local economy. We will focus on job creation by supporting business and investing in skills.

Employment in the south-west is up by 163,000 since the 2010 election; unemployment is down by 42% over the same period; and some 99,000 new businesses have been started in the south-west during that time. As my right hon. Friend has said, the Chancellor set out an ambitious six-point plan for the south-west earlier this year. It includes £7.2 billion of investment in the transport connections of the south-west, over £4 billion of investment in the electrification of the Great Western main line and a £10 million package of support for coastal towns across the south-west.

The south-west has an average annual growth rate of 4.17%, which is below the UK average of 4.23%. It is a small difference, but over time it leads to a significant difference in prosperity. It is driven by a gap in productivity; although the south-west accounts for 8.4% of the UK’s population, it accounts for only 7.5% of total output, as my right hon. Friend pointed out. It is that productivity gap that the Government want to address.

[Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)]

We are about start the largest infrastructure project in Europe: Hinkley Point C. The Minister and the Government have been very helpful in that. One of the most important things we have realised is that “learning and skills” is not synonymous with Somerset, Devon, Cornwall, Wiltshire or anywhere else in the south-west. Surely, we should be spending more in further and tertiary education and in universities in the south-west to encourage people to stay and work in some of our excellent industries. Does he agree?

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[Mr Jones]

I thank my hon. Friend for his comments. I am aware that growth deals have been put in place in his area to do just that, which is excellent news.

The employment rate in the south-west is above the national average, with over 35,000 more people in work in the past year alone. If we succeed in maintaining that momentum and in raising the long-term growth rate to the UK average, we could add £6.5 billion in real terms to the economy of the south-west by 2030.

The Government have agreed 39 growth deals across England, in which £7 billion will be invested in a wide range of local projects. The money will go towards providing support for local businesses to train young people, create thousands of new jobs, build thousands of new homes and start hundreds of infrastructure projects. Some of the major projects in the south-west that will be built as a result of these deals include £23 million for a new road tunnel linking Swindon to nearby Wichelstowe, creating thousands of jobs and opening up a new site for thousands of homes; £4 million to create the UK’s first robotics institute at Bristol; and £12.9 million to unlock housing and employment sites at junction 25 on the M5 at Taunton, which my hon. Friend the Member for Taunton Deane (Rebecca Pow) referred to.

I was pleased to hear in the Chancellor’s Budget earlier the comment that we were making good progress towards a devolution deal in Cornwall, which is an important part of the south-west and of the south-west’s potential.

Let me pick up on a couple of the points made by my right hon. Friend the Member for North Somerset. I note what he says about education, which is extremely important. I can empathise with what he says, as in the county of Warwickshire we often suffer from the same funding inequality. I am sure that he, along with other colleagues, will be pleased that in the last Parliament the Government made strides to move that inequality in the right direction and to close the gap. He will know that our party made a manifesto pledge to continue that funding across this Parliament. I am sure that the Department for Education will have heard his comments and those of several other hon. Members loud and clear.

I hear what my right hon. Friend says on local government funding and rural sparsity. Over the next few months, we will be working on the funding allocations for local government. No doubt, during that process, I will receive many representations from this part of the country if tonight is anything to go by. The Government have also provided additional funding this year for rural areas to take the sparsity issue into account.

Another of my hon. Friends mentioned local councils’ ability to benefit from business rate retention, the new homes bonus and additional council tax. I am sure that the growth deals that have been put in place across the south-west will be beneficial as regards those additional funding streams. I hear what my right hon. Friend the Member for North Somerset said about council structures. Obviously, we are working towards a devolution deal in Cornwall, but I can reassure him that with council structures, devolution deals or combined authorities there is no Government prescription for how local people should organise their affairs. This is purely a bottom-up process in which local areas can come together and tell the Government what they would like to see. I hope that that gives him some assurance that we will not make any councils go into shotgun marriages, shotgun divorces or any arrangements that local people are not pressing for.

I probably do not have time to go through every comment made by my right hon. and hon. Friends. One big point that came out loud and clear was that the south-west sees infrastructure projects as hugely important in improving the tourism industry, industry in general and the lot for the agricultural sector, which is extremely important in many parts of the south-west. A Transport Minister from the south-west was on the Treasury Bench during the debate, and the Department for Transport will listen carefully to what my right hon. and hon. Friends have said about ensuring that we try, within the difficult circumstances we face, to do whatever we can to support the economy in the south-west.

The Chancellor will probably also consider many of the suggestions for roads, dual carriageways, junctions and so on as bids during the spending review, the next autumn statement and the next Budget. I encourage colleagues to speak to the Chancellor’s Parliamentary Private Secretary, as the demands and requests are slightly above my pay grade.

This has been a fantastic debate. The south-west is an extremely important part of our country. The Government are committed to supporting it, and I thank my right hon. Friend the Member for North Somerset and so many of our colleagues for raising issues from the south-west, so that the Government could listen tonight.

Question put and agreed to.