Nigel Evans
Main Page: Nigel Evans (Conservative - Ribble Valley)
Mr Deputy Speaker (Mr Nigel Evans)
Order. As colleagues will see, this is a very popular and important debate, and a number of colleagues wish to participate in it. A five-minute limit has therefore been introduced.
Mr Sharma
I have the facts here and we must agree to differ on their interpretation.
The Governor of the Bank of England added that unless the G20 nations at the current summit in South Korea work together on trade and tackle imbalances between creditor and debtor nations, the world economy is likely to be damaged. He said:
“What is most important at present, given the difficult and dangerous times that the world economy faces, is that the world leaders at the G20 have a constructive approach… We are in a position where the world economy can be a win-win outcome, but I’m afraid we’re also in a position where it can be a lose-lose.”
These are indeed difficult and dangerous times for the world economy and for UK growth prospects. Britain is particularly vulnerable to economic shocks in the eurozone. UK banks are exposed, with many loans to Ireland, Greece and Spain. Rumours of an EU bail-out of Ireland were rife in the financial markets only this week.
Equally, in the wider international economy, China, Brazil and India have all seen economic growth reducing. This all means more uncertainty as Britain tries to rebalance its economy away from being reliant on financial services and consumer spending on domestic service industries and more towards export-driven sales of our manufactured goods. My right hon. Friend the shadow Chancellor is right to say that the previous Government became over-reliant on tax receipts from the financial services sector, so it is right that, as we go forward, we try to build our manufacturing base back up and sell more of our goods in the world market, but it will not be easy.
I shall now deal with the domestic economy and growth—or, given the Chancellor’s reckless plans as laid out in the spending review, perhaps I should say the lack of prospects for such growth. The growth figures of 1.2% and 0.8% for the last two quarters have indeed been welcome news, but have nothing to do with the Government’s decisions since coming into office. The truth is, in fact, quite the opposite. Those two growth figures show the positive effects of the previous Government’s fiscal stimulus. When carefully analysed, the figures also show that much of the growth was due to a temporary and seasonal upturn in the construction industry.
If Members care to look at the predictions for the UK construction industry going forward into 2011, they will find talk of recession. This is not surprising, given the Government’s decisions in the emergency Budget and the spending review. If the housing capital budget is slashed by more than 50%, it does not take an economic genius to work out that the construction industry is going to take a hit. Equally, the cancellation of the Building Schools for the Future scheme, and the 60% reduction in the capital budget for schools, will also have a severe recessionary impact on the construction industry.
Let me illustrate that point with examples from my constituency and local borough. Ealing was due to have 18 schools either completely rebuilt or significantly rebuilt or refurbished. Some £305 million was to have been spent on those projects, representing a substantial boost to the local and regional economy, in addition to meeting the need for extra school building due to a rising demand for school places in the borough. Those plans were brutally cut in the emergency Budget, and in the end we managed to rescue projects for two sample schools, one of which is Dormers Wells high school in my constituency. However, we still face the withdrawal of almost £250 million of public money—
Ian Swales (Redcar) (LD)
I should like to speak about growth through green technology, on which the Government have clear policies. I was very pleased to hear their announcements about the regional growth fund, carbon capture and storage, technology centres and investments in ports for wind technology.
I know that some people will be cynical about whether green growth and manufacturing is possible, but I shall speak about what is happening in Teesside to fill the House with a bit of enthusiasm for the future. Many companies there are already operating in the area of green technology or are about to start doing so, and I shall name a few.
Many people think that wind technology is the only area of green technology, and indeed there are companies in Teesside involved in it. Tata Steel, TAG Energy Solutions and Heerema Fabrication are all making wind turbine structures, and MPI Offshore, which runs turbine installation vessels, recently managed to put up 100 offshore turbines in under 100 days at Thanet.
There are also wave technology companies. Three companies—JDR Cables, CTC Marine and Brown Ltd—recently joined together to put in the new wave hub off Cornwall. In the area of fuel and energy, we have Ensus, which has the largest bioethanol plant in Europe; Harvest Energy, the UK’s largest biodiesel manufacturer; SITA, which has the largest energy from waste facility in the UK and has recently announced an extension of it; INEOS Bio, which has Europe’s first advanced bioethanol from waste plant; and Sembcorp, with the first large-scale wood biomass power station.
MGT has announced that it will spend £500 million on a new biomass power station, and Northumbrian Water has an anaerobic digestion facility that processes waste from an equivalent population of 1.9 million people. This week, a company called DRD Power has announced technology that should see an end to cooling towers in this country, because it will generate electricity from lower-temperature hot water.
There are many other companies involved. Greenstar makes recycled food-grade plastic packaging that is used by Marks and Spencer. The world’s largest tyre reclamation plant is also about to start. I could go on, and I make no apology for going through that list, because those are exciting developments.
There is a tremendous cluster of expertise in Teesside, and the Government should encourage it as much as possible. Teesside has been an industrial powerhouse for more than a century. Traditional industries, such as ship and bridge building, bulk chemicals and steel have declined, but we are now seeing exciting developments, which follow growth in offshore technology.
Local expertise can be built around such clusters, and that is obviously already happening. As we have just heard, joint bids can be made for projects. Local education establishments are focusing on the skills that are needed and are creating a system of apprenticeships to develop those skills.
Projects can also be implemented more quickly on Teesside. SITA’s UK technical manager recently said that major projects can be achieved on Teesside in less than half the time it takes in many other places.
As a result of the clustering that I mentioned, Teesside is also a great place for carbon capture and storage, and I urge the Government to consider industrial areas such as Teesside for carbon capture and storage grids and not to look just at coal-fired power stations.
Given those outstanding opportunities, the Government need to continue to help. They should carry on the seed funding provided by One North East for things such as the Tees valley industrial programme. I welcome the establishment of the Tees Valley local enterprise partnership and the regional growth fund.
The Government urgently need to clarify the long-term banding policy for renewable energy, especially biomass, and quickly to establish the green investment bank. Given all the expertise on Teesside, I recommend that the bank is put there.
I emphasise that all the projects mentioned are private sector projects. Government involvement could bring enormous leverage. In the end, many investors are ready to finance this new green technology. I recently met an investor who said, “Come to me with projects of a minimum of £20 million”—that was a minimum, not a maximum.
I am sure that the House would like to join me in congratulating those involved in the progress on green technology on Teesside—