Humber Economy (Fiscal Support)

Martin Vickers Excerpts

Tuesday 27th November 2012 Westminster Hall

[Martin Vickers (Cleethorpes) (Con)]

As ever, it is a pleasure to serve under your chairmanship, Mr Amess. I agree entirely with the compliments that the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson) paid to you.

I congratulate the right hon. Gentleman on securing a debate on the Humber economy, particularly as my hon. Friend the Member for Brigg and Goole (Andrew Percy) and I have put in three applications for such a debate. The right hon. Gentleman was the lucky one, so well done to him on that score.

The debate is on fiscal support for the Humber region, and there is no doubt that the sub-region needs support if it is to benefit from the great opportunities that present themselves. Such support can come from the Government or from Europe but, most significantly, it can come from private enterprise. I do not mind where it comes from; I am eager to provide jobs and growth for my constituents and the area more generally. The infrastructure that would be key to the area’s development is vital and, to a great extent, support for that would come from the taxpayer.

The right hon. Gentleman rightly points to opportunities from green energy, especially the renewable sector. However, I add one caveat: if we are to succeed with that, there must be Government support, but there are limits to the size of bills with which households and existing business can cope. My constituency contains a number of very intensive energy users who are—I shall not say “crippled”—finding things extremely difficult as a result of energy costs.

We must consider how we channel public sector money, and the right hon. Gentleman rightly pointed out the importance of the LEP. The two councils on the south bank showed good judgment by joining two LEPs. They recognised that although the Humber estuary may be key to the area’s economic development, considerable support is available by looking south into greater Lincolnshire, particularly in relation to food processing and tourism, which are important for the Cleethorpes area.

Lord Heseltine’s “No Stone Unturned” report, which has been referred to, highlights the role of LEPs. They will be absolutely key to future investment, but I have one or two concerns about them, in that they are, to a great extent, unaccountable. I strongly feel that public money should always be spent by accountable bodies, rather than anonymous quangos. Nevertheless, given that they harness the private and public sectors together, they have a key role.

I can speak only for the councils on the south bank, but I would make one criticism, particularly of North East Lincolnshire council, about consistency. There have been far too many changes of direction on what is important for the area’s economic regeneration. The hon. Member for Great Grimsby (Austin Mitchell) will know that we had the “Greater Grimsby” initiative, during which everything was promoted under that label, but that has been replaced by yet another initiative. We need a much more consistent approach. I commend the councils for working together much more closely. There were a few stumbling blocks when we were setting up the LEP, and I have to say that I have found it easier to work on a cross-party basis here than back in Humberside. Local rivalries need to be tamed if we are to work together.

I am concerned that Government initiatives place too much emphasis on cities. The right hon. Member for Kingston upon Hull West and Hessle pointed out the importance of city deals and city regions. They are important, and the idea of the city region and its trickle-down effect for the wider local economy is fine in principle, but I urge the Minister to consider the fact that provincial towns, such as Grimsby, Cleethorpes, Scunthorpe, Brigg and Goole, need support from the Government, because such support might be too concentrated on the core cities.

I have spoken on a number of occasions about the importance of local leadership, and I noticed that Lord Heseltine’s report spoke of its neutering. The LEP plan for the Humber says the region has experienced “under-investment” and “weak…leadership and governance”. I am in favour of broadening the talent available to local government through elected mayors, although I know that that notion will be cast aside by many. It was a mistake that cities did not take up the opportunity of encouraging their local communities to go for elected mayors because that has left a void, and the provincial towns and smaller cities might steal a march on the cities that rejected the concept—perhaps a brave local leadership might go for it, but I have my doubts. I note that Lord Heseltine is still a great advocate of that approach.

There is a danger that we could talk ourselves down. I recognise that there have been major blows to the area: significant job losses on the north bank in recent times, and the announcement three or four weeks ago of the closure of the Kimberly-Clark factory in my constituency—in Barton-upon-Humber—with up to 500 job losses. Although there have been major setbacks, we must also acknowledge the excellent opportunities that exist, and not only those in the renewables sector.

The right hon. Gentleman mentioned the potential Able UK investment in the south Humber energy park. That alone could produce upwards of 5,000 jobs, but 5,000 jobs in two or three years’ time is a very distant prospect for someone who has just lost their job at Kimberly-Clark or Comet. Two years’ time is 24 mortgage payments away for someone who has just been put on the redundancy heap, so support is urgently needed. I welcome the Government’s energetic support for the various taskforces set up following announcements such as those from Kimberly-Clark and Tata Steel in Scunthorpe.

We must not lose sight of our potential, however. When measured by tonnage, the Associated British Ports Grimsby and Immingham dock complex is the largest in the UK. It is a major engine of the local economy and ABP has plans for future investment. I have mentioned intensive energy users, such as the oil refineries and chemical processers that also play a major part in the local economy.

The Minister might like to comment on the fact that biomass seems to be stalling. We had projects in the pipeline, and two in particular on the south bank: one in my constituency and one at Brigg, in the constituency of my hon. Friend the Member for Brigg and Goole. Those projects promised a considerable number of jobs, but they seem to have stalled on the basis, the investors tell us, of Government uncertainty. That “uncertainty” probably means certainty, but just not certainty that those particular investors approve of. I hope that the situation will change in the not-too-distant future.

We have other major plus points, such as, in effect, £150 million of Government money through the reduction of the Humber bridge toll. We also have enterprise zones and, significantly, the Government announced last week that the A160 upgrade, which will improve access to Immingham docks, will definitely start in 2015. An important investment that the hon. Member for Great Grimsby and I have been pushing for is a rail link between the Grimsby-Cleethorpes area and King’s Cross, serving Brigg and Scunthorpe.

I appreciate that time is moving on, so I shall conclude by saying that although we all recognise the difficulties the Government are in, Humberside has taken severe knocks. We need a lift to kick-start private investment. I look to the Minister not only to list all the good things that have been happening, but to give us a positive direction on what he can do now and in the coming couple of years.

--- Later in debate ---

[Andrew Percy (Brigg and Goole) (Con)]

It is a pleasure to serve under your chairmanship, Mr Amess. I pay tribute to the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson) for securing the debate. As my hon. Friend the Member for Cleethorpes (Martin Vickers) stated, he and I tried to get such a debate, so this is another example of cross-party working.

I apologise for missing the first three minutes of the speech of the right hon. Member for Kingston upon Hull West and Hessle. He started and ended with Andrew Marvell, which reminded me of walking past Marrell’s statue every day during my schooldays. We did not pay much tribute to him then, because his left hand was broken; it was restored only in 1999. Marvell was important to us, but not enough to have that fixed for a couple of decades.

This is an important debate in which I have a couple of asks of the Minister as well as some words of thanks. I take on board the point of the hon. Member for Kingston upon Hull North (Diana Johnson) about not wanting to talk down the Humber; we all have a responsibility not to talk it down, because this region is not just struggling today. Like my hon. Friend the Member for Cleethorpes, I was born and bred in the Humber. My family has lived on both sides of the river for the past couple of centuries; we do not like to move far. [Interruption.] Nowhere too far anyway. I feel very invested in the region and also very proud of it; it is a fantastic region. None the less, it is a region that has struggled not just in the last two or three years but over the past few decades, due partly to the fall-off of the fishing industry and other industries. People forget that there used to be an awful lot of foundries in Hull. My dad worked in one, but he lost his job when it closed its doors in the early ’90s. There has been a lot of change over the past few decades in the profile of our local economy to which we have not responded particularly well. Even today, we are still faced with many of the challenges that go back a number of decades.

It is important to remember that there are a lot of positives in our region, and some of them are happening as we speak today. I want to be positive about the things that have happened already before making my requests of the Government. The hon. Member for Kingston upon Hull North mentioned the caravan tax. Sadly, it is a measure of all Governments that they sometimes do things that are not good for our local area; we are not alone in doing that. However, the first thing that our Government did when they came to power was to scrap the ports tax, which would have had a similar effect on our local economy as the caravan tax, and I thank them for that. As a result, 62 businesses in Hull, 59 businesses in Goole and 44 businesses in Immingham have been protected to the tune of about £30 million.

Back in the 1980s, the biggest land grant in the history of this country was given to Hull for the Victoria dock by the Thatcher Government, and of course we had the housing action trust money in the early 1990s. Anyone who was around at the time will remember how that funding was used for the mass regeneration of places such as the North Hull estate. We have done well in the past, and also done well locally. For example, we secured £150 million for the Humber bridge. Again, that was something that had never been delivered before and was due, in part, to the strong cross-party campaign from all of us in the region. The number of vehicles crossing the Humber has now increased significantly. On Saturday, I was in the Brigg tourist information centre, asking the staff about how things were going since the tolls came down. They showed me the postcode list; there were not just the DN postcodes from the south bank but many HU postcodes. The investment is having a real impact on tourism, which the hon. Lady mentioned.

We are also grateful for the infrastructure funding that we have received. The A164 is important for connectivity from the Humber bridge to Beverley. Similarly, the announcement of the funding for the A160 is welcome. I am keen to support work on the A63, which is some miles from my constituency. When an MP who does not have a constituency interest in a project comes and demands the money for it, perhaps their view should carry a little more weight. Infrastructure on to the A63 is key to unlocking the docks, which would have a huge impact on our whole economy. It is odd to argue for a road scheme that is outside one’s constituency, but we do so because we can all see the bigger picture in the Humber. I urge the Government to do everything they can on that road, because it a problem that has plagued the city, the docks and the local economy for a very long time.

We have had terrible news recently with regard to job losses. Like my hon. Friend the Member for Cleethorpes, I pay tribute to Jobcentre Plus and the local councils, which have responded positively to the situation. I met Jobcentre Plus last week to talk about Scunthorpe and Lloyds TSB, and was informed that the majority of people who had lost their jobs there have now found alternative employment, thanks to the hard work not only of those people but of Jobcentre Plus staff.

We are also grateful for the regional growth funding in both east Yorkshire and northern Lincolnshire. To date, the funding in northern Lincolnshire has created 344 jobs and is well on target to create 500 jobs, and only about half of that money has been allocated. I pay tribute to the councils that have worked so hard on that matter and the businesses that have come forward.

Northern Lincolnshire has had a 68% increase in apprenticeships, and I pay tribute to the council for investing significant resources into creating apprenticeships within its authority and for trying to identify other local businesses to take on apprentices.

I briefly want to echo the concerns that have been raised about renewable energy. I make no bones about my position on onshore wind, which is a huge concern to my constituents, but on offshore wind, there is complete and utter unanimity in our region about its potential and about our support for it. My hon. Friend the Member for Cleethorpes and I recently wrote to the Prime Minister urging some consistency on the matter. I was heartened by the response that we received:

“I will continue to voice my strong commitment to the growth of the low-carbon sector…and agree that Government has to continue to act coherently and consistently to put green growth at the top of its priorities.”

Those are excellent words; we now want action. Offshore wind is hugely important to our region. We can develop the skills base to support that sector, which will help not only our region but UK plc.

I have a couple of asks of the Minister in relation to biofuels and bioethanol production. We have two plants in the Humber; one planned on the south bank and one on the north bank. There is uncertainty over whether the Government are committed to bioethanol. The fact is we must have it in our fuel, and at the moment it is coming from Germany or elsewhere. We should be growing that industry here, so I make a call for as much support as possible.

On biomass, places such as Drax and Eggborough, on the edge of my constituency, have coal-fired power stations that wish to co-fire with biomass. Again, uncertainty exists. I met representatives in Eggborough who were concerned about the subsidy system. They have asked us to raise contracts for difference, which the Minister, I am sure, will be fully apprised of, so I will not give him a great deal more detail—obviously, I am not saying that because I do not fully understand it. None the less, it is something the sector is keen to unlock for co-firing biomass. I will end now because I have had my time.

[Martin Vickers]

Not yet.

[Andrew Percy]

Oh, I am not at the end yet. My hon. Friend is meant to pass me a note when I am.

We are trying to unlock significant European regional development fund money for the Capitol Park project in Goole, which will bring thousands of jobs to the logistics sector in the region. I am heavily involved in that project at the moment, and I seek an assurance from the Minister that, if we do not progress that matter in the next couple of days, he will add his considerable weight to solving some of the issues. The development is really important for our local area.

I end by saying that more needs to be done, especially on broadband delivery UK funding, which is particularly important to many of our small and medium-sized enterprises, and on the A63. Furthermore, we must have certainty on offshore wind and renewable energy for our region.