Hospital Services (North-East)

Phil Wilson Excerpts

Tuesday 27th July 2010 Westminster Hall

[Phil Wilson (Sedgefield) (Lab)]

Thank you for giving me the opportunity to speak in the debate, Mr Sheridan. I want to make a business case for the Wynyard hospital based on its effect on the local economy, because the Government’s decision is short-sighted. The new hospital was to be sited at Wynyard park—a 700-acre business park owned by Wynyard Park Ltd that has created more than 1,000 jobs in the past five years. Fifty-five companies have moved on to the site, and the hospital would have been a catalyst for further private sector investment and jobs. The Government go on all the time about the need to rebalance the north-east’s economy, and the Opposition agree with them. One way to do that and to help generate private sector investment would be to invest in infrastructure and public sector hospitals, such as the one that the Government have cancelled.

The cancellation of the hospital came on the back of the announcement about housing benefit. The former Chancellor said that we would take £250 million out of housing benefit through reforms, but the present Government want to take out £1.8 billion, which would greatly affect areas of County Durham. In addition, just under 100 schemes have been cancelled under Building Schools for the Future, which is a problem not just for education, but for construction jobs in the region. On top of that, the regional development agency is to be abolished. It has played a part in work on the Wynyard site and the foundation hospital, and it has tried to attract investment into the area.

[James Wharton]

I understand the hon. Gentleman’s terminology when he says that the RDA will be abolished, but is it not rather the case that it will be replaced by more localised local enterprise partnerships, which will deliver better for local people in communities across the north-east?

[Phil Wilson]

Actually, it is being abolished—that is what is happening.

I want to make two points about the RDA. First, it invested £2 million last year in attracting inward investment. On the basis of that money, it attracted £720 million of inward investment into the north-east—82% of inward investment into the region comes through the RDA, so if it ain’t broke, don’t fix it. Secondly, in preparation for the hospital development, the RDA organised meetings between the foundation hospital and overseas firms to see whether those firms would come on to the site.

[Mr Kevan Jones]

Does my hon. Friend agree that the person who had the vision for the Wynyard site was John Hall? He saw the benefits of working with the RDA and others to develop it, and the hon. Member for Stockton South (James Wharton) was a big supporter of his during the election.

[Phil Wilson]

That is absolutely right. I heard John Hall speak last Friday, and he also has a lot to say about the abolition of the RDA.

[Mr Iain Wright]

My hon. Friend is making a convincing economic case for the hospital. Does he agree that the £464 million in investment that was to be provided could also provide about 550 apprenticeship opportunities in the construction industry and elsewhere? The Government say that they want private sector-led growth and recovery, and I agree with that approach, but scrapping the hospital and cancelling Building Schools for the Future will mean that private sector construction industry jobs are not maintained. Is that not a devastating blow for the north-east?

[Phil Wilson]

That is absolutely right. Over the past 13 years, the number of apprenticeships in the region has gone up astronomically. In 1997, in my constituency, there were fewer than 30 apprenticeships, but there are more than 700 today. Obviously, anything that curtails the growth of apprenticeships in the future should be frowned on.

As far as other jobs are concerned, the hospital would be a catalyst for inward investment and private sector investment. Wynyard Park Ltd worked closely with the hospital, local universities and further education colleges because it realised that high-value medical and other research jobs would come to the area. The company estimated that 12,500 jobs would be created on top of the 3,000 jobs that the hospital would create. There would be 12,500 private sector jobs in the area on the back of the hospital development—just think of the Government’s income tax and national insurance take and all the other benefits that they would pick up on the basis of that growth in the local economy. Public sector investment would kick-start growth in the private sector.

The hospital would also have become an anchor tenant—a tenant that attracted a lot of other investment to Wynyard. In addition, it would have brought greater investment in infrastructure: the roads and transport networks would have improved, which would have brought more businesses to the park. This is not just about the hospital, as great as that would be. My family and I have used the North Tees and Hartlepool hospitals, and they are great hospitals, but it is time to replace them and to have a new hospital. The credible case put by the new hospital’s designers was that the development would be not only a hospital, but a catalyst for growth in the private sector economy in the south Durham and Tees valley area. That case has been completely ignored.

I really get annoyed when people try to say that the project was worked out on the back of a fag packet a few weeks before the general election. I have been attending meetings on the issue since I was elected in 2007, and meetings were going on before then. We need the development to happen.

The Government’s proposals prove what the Prime Minister said during the election campaign when he pointed out that the north-east would feel the brunt of the cuts. He was right to say that we rely too much on public sector jobs, so the Government should give us the opportunity to change that, but that opportunity was taken away from us when the hospital programme was cancelled.

[Guy Opperman]

The hon. Gentleman asserts that the area should be given the opportunity to address the lack of private sector jobs, but that that would not be done by spending more public sector money. We cannot address the deficit on every single occasion by creating private sector jobs through public sector spending, which is surely the basis of the hon. Gentleman’s hospital argument.

--- Later in debate ---

[Phil Wilson]

We are not saying that we should do that at every opportunity, but when we spend public money, we should take the opportunity to ensure that it pump-primes the local economy. That is what the Wynyard scheme was bound to do. Perhaps the hon. Gentleman does not think that the public sector is of any value, but Opposition Members do.

[Guy Opperman]

Will the hon. Gentleman give way?

[Phil Wilson]

No, several other Members want to get in on the debate.

Figures have been bandied about, such as the £5 billion and the £11,000 difference, which was actually £11 million—the Minister corrected that error, and I noticed it, too, and went up to correct it. That £11 million, over 35 years, means the difference between a new hospital and a hospital that is falling down. Surely we could have found that money somewhere to help to maintain the hospital.

I want to end with a question to the Minister. Three or four weeks ago, we brought down the foundation trust’s chief executive and the chair for a meeting, and I was pleased that the Minister could meet us. I took away from that meeting the view that the Department would look again at the development if the trust could come up with a credible scheme or initiative to get money from the private sector. If all the figures stacked up, would the Department underwrite such a proposal? We are talking about a foundation hospital. Are we saying that foundation hospitals will be around for ever? Things might change—Governments might change, policy might change—but the hospital must still be funded. Are the Government prepared to underwrite any financial arrangements with the banks and the private sector?

On that point, I will sit down and listen to what other Members have to say. The proposed hospital is a missed opportunity for growth in not only the public sector but the private sector in the region.