West Midlands and Coventry

Mark Prisk Excerpts

Tuesday 13th December 2011 Westminster Hall

[The Minister of State, Department for Business, Innovation and Skills (Mr Mark Prisk)]

I am pleased to have the chance to discuss economic opportunities in the west midlands, particularly in Coventry. I commend the hon. Member for Coventry South (Mr Cunningham) for securing the debate. He highlighted several practical issues around job losses and questions for small businesses. I will address all of them, including the specific transport schemes that have been mentioned.

It is worth taking a step back and remembering that the west midlands is a key part of our national economy. If we look at the most recent complete gross value added figures, it accounted for just over 7% of the UK’s GVA in 2008. It is important that the area is successful and prosperous. Clearly, there have been problems. I understand that it is a difficult time for individuals caught in unemployment or facing redundancy. However, there has been positive news. I welcome the balanced view that the hon. Gentleman presented of the challenges and also the good news. The Opposition will understandably challenge what the Government are doing, but we have to be careful that we do not start to talk down Coventry or other areas and that we strike a sensible balance. We must recognise the problems, but we must also look at where the opportunities are, because I think they are strong.

We have seen, for example, the £355 million investment by Jaguar Land Rover at i54. It is not immediately within the Coventry area, but it is crucial for the whole JLR programme. We have seen the £31 million that JCB is putting forward for its next generation of engines, which will form a crucial part of the skills base in the west midlands. We have also seen investment in BMW at Hams Hall, just outside Coventry. This is welcome news because not only is it good for businesses, it is a tribute to local workers. I want to put that point on the record. The hon. Gentleman and I have met the trade unions with regard to Rolls-Royce at Ansty. I hope that conversations between unions and management will persist to ensure that is somewhere that can remain competitive.

[Lorely Burt]

For many of us in the coalition, it seems that there is tremendous potential for the west midlands, because of the tremendous skills base. The Minister mentioned Ansty; he did not mention the fact that in my constituency of Solihull, Land Rover is creating 1,000 jobs in addition to the ones that he has already mentioned. There is so much potential for jobs and for the development of research and technology in our west midlands area, particularly close to Coventry.

[Mr Prisk]

I am grateful for the hon. Lady’s contribution. I will come to the broader Jaguar Land Rover issue, because it is crucial for the whole network of engineering and manufacturing in the region. We must be careful to remember where the roots of the problem lie. In 1975, GVA was ahead in the west midlands—above the national average. In the first decade of this century, from 2000 to 2008, the increase in GVA per head in the region was the lowest of any part of the country. In Coventry, the decline is clear. In 2000, we saw GVA per head 10 points above the national average; by the time we get to 2008, it is eight points below, so there are significant challenges. Indeed, the west midlands was the only part of the country where the number of private sector jobs fell between 1998 and 2008, so there are real underlying issues.

We are committed to rebalancing the economy; that includes sectors and geography. I turn to the specific areas of activity that I think are relevant. First, local enterprise partnerships are crucial. In the few months that they have been in existence, the Coventry and Warwickshire LEP has established a business mentor network; it is working with the banks to unlock credit at local level in addition to what we are doing at national level, and it has also identified key development and infrastructure opportunities. If I may, I will come to the question of Tollbar End and the development of that site in a moment. I know it is very important.

We have put £248,000 into the Coventry and Warwickshire LEP to get it up and running. That is not designed to provide a vast administration. I am not sure that we want a vast administration. We want outcomes. That is why the LEP is getting its funding strategy in place; it is why it is putting in place its evergreen fund and it is why we are making sure that there is a portal in place so that it is actually able to engage with small businesses.

[Mr Ainsworth]

Will the Minister give way?

[Mr Prisk]

If the right hon. Gentleman does not mind, I will not give way, because I want to try to answer some of the points raised. There are important issues that will advantage his constituency in Coventry as well.

I entirely agree that apprenticeships are crucial. The LEP is addressing that issue with its local project, on top of the work that we are doing to help small and medium-sized enterprises. I can direct the hon. Member for Coventry South to the new programme recently announced to make it easier and simpler for SMEs to take on apprenticeships. We are providing funding to the tune of up to £1,500 per apprentice. I agree that there is an issue around making sure that SMEs are able to do this. Accessibility will make it easier for Coventry’s SMEs.

There are 24 enterprise zones. I am aware that the Coventry and Warwickshire LEP will have been disappointed that its own bid did not make it. However, just beyond the area, the MIRA technology park will be of some importance to local businesses. On transport and the Tollbar End commitment, the Government have brought forward their intention to ensure that £110 million is available to sort out the congestion. We recognise that there are still live issues about whether the development next door could be hindered by it. I have made that clear to officials and they are engaged in discussions with the LEP to see whether we can keep the £110 million to get the investment, but not lose or unduly delay the development programme.

[Mr Ainsworth]

Members representing the whole of the LEP—from both parties—met earlier this week and will be seeking a meeting with the Minister to try to make absolutely certain that his Department is focused on that problem, because it is enormously important. Can the Minister give us a commitment to meet a delegation from the whole Coventry and Warwickshire area on that issue?

[Mr Prisk]

I understand the issue. Given that the Department for Transport is in the process of finalising its decision, I should not pre-empt it. If it becomes necessary for Ministers to have a meeting, I am sure that I or my colleagues will be willing to do that.

The hon. Member for Coventry North West (Mr Robinson) said that Coventry had not had any successes with the regional growth fund. Perhaps I can bring him up to speed. In fact, £3.6 million from the second round of the regional growth fund has brought two relevant projects to the area. There is the Aston Martin body construction facility with £1.6 million of public investment, unlocking between £5 and £6 for every public pound put in. There is also, perhaps more importantly, the LNX distribution programme with £2 million of investment from the Government, which should bring some 340 manufacturing jobs directly to Coventry. I understand the specific issue that the hon. Gentleman raised and that he may have been disappointed by the bid, but there has been some success, particularly in Coventry, and I hope that he welcomes that.

I welcome the points that have been raised; we need sensible dialogue about them. Parties may disagree on the bigger economic issues, but we are committed to ensuring that businesses and workers in Coventry and the wider west midlands are able to unlock their potential. We need to support them through skills and investment, to make sure that they can fulfil their potential and overcome their historical problems.