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1.47 pm
The Minister of State, Department for Education and Employment (Mr. Eric Forth): I congratulate the hon. Member for Truro (Mr. Taylor) on obtaining this Adjournment debate. The issues that he has raised are obviously important for his constituency and the surrounding area.
As the hon. Gentleman knows, last week we announced another large fall in United Kingdom unemployment and a strong rise in the number of people in jobs. That good news applies to all regions, including the south-west, which has the second lowest seasonally adjusted unemployment rate in the country, at 5.5 per cent. As the hon. Gentleman acknowledged, unemployment in the south-west has been falling over the past six months by an average of around 3,500 people a month. The national and regional picture is positive.
However, I accept that unemployment is still too high. I fully accept that more needs to be done in Cornwall in particular, where unemployment regrettably rose last month, against the trend. However, the current unadjusted unemployment rate for Cornwall of 8.8 per cent. compares favourably with the figures of 10.2 per cent. in December 1995, 14.5 per cent. in December 1992 and a peak of 15.5 per cent. in January 1986.
The hon. Gentleman referred to recent redundancies in Cornwall and in his constituency. Of course, the recent announcements from English China Clay International at St. Austell, and St. Ivel at St. Erth, did not make for the best of starts to the new year for those affected by them. We always regret job losses and want to do everything possible to help. Programmes such as training for work, work trials, jobfinder's grants, and so on, are in place to come to the rescue of people who unfortunately find themselves out of work--particularly if it is for a long period. The English China Clay International and St. Ivel rationalisations will be treated as major redundancies, which means that the normal eligibility conditions for the Employment Service and training and enterprise council programmes will be waived. That is a very important consideration for the individuals involved.
With help from the Employment Service and Devon and Cornwall training and enterprise council, there is good reason to believe that people affected can expect--directly or after retraining or other support--to find other work in the foreseeable future. I understand that, with regard to the proposed closure of the St. Erth factory, new jobs will be generated at other St. Ivel and Unigate processing plants in the region and redundant workers from St. Erth will be given priority for those jobs.
I hope that the hon. Gentleman will acknowledge that the recent news on jobs in Cornwall has certainly not been all bad. As a result of the Inland Revenue at St. Austell winning its bid to house the self-assessment inquiries and stores section, 300 to 400 telephonist jobs are being created over the next couple of months. He will be aware that a number of new retail jobs can be expected as the new Treliske retail park nears completion. He must also be aware of the £4.8 million six-year CHEERS project, led by Restormel borough council and funded under the single regeneration budget, which is aimed at building and providing housing refurbishment and redevelopment to strengthen community involvement, improve employment and raise skill levels.
I make such comments not of course unaware of the pain and problems caused by unemployment to those affected, their families, and, indeed, across a much wider area, but I do not think that the prospects are quite as gloomy as the hon. Gentleman appeared to suggest. We know that not all people who are made redundant become unemployed and that most spells of unemployment tend--mercifully--to be short. Of those people who do become
unemployed, a quarter leave unemployment in one month, half in three months and two thirds in six months. Those are well-established trends.
However, we need to face the fact that the sort of job rationalisations to which the hon. Gentleman has referred are part of the process of a dynamic and changing economy--indeed a changing region, as he pointed out. It is not for the Government to interfere with or second-guess commercial decisions made by companies. If we were to try in some way to force companies to keep unprofitable sites open, we would inevitably add intolerable burdens to those already on business and risk destroying jobs in the long term, as our partners on the continental mainland have discovered very much to their cost.
We have to recognise that some jobs will be lost and others created, and that the pace of it will vary from time to time in different regions of the country. I should point out that it is to our great credit as a nation that the traditionally large disparities in unemployment between regions have largely been evened out. The extent to which we have succeeded as a nation in ensuring that, by and large, people up and down the United Kingdom have broadly the same opportunity to work is quite remarkable--a startlingly different picture from that even 10 years ago and certainly 15 or 20 years ago. We should be happy and optimistic about that. We must face the fact that people cannot expect to have the same job throughout their working life, and in doing so we must try to ensure that, whether by education, training or different kinds of support, we can help people to make the adjustments that inevitably arise from such changes.
The hon. Gentleman said much about economic assistance to Cornwall and implied--indeed I think said--that Cornwall was not somehow getting its fair share of Government funding. The problems that Cornwall faces are widely recognised in a number of different ways. That is why so much of the county has assisted area status and is eligible for regional selective assistance. Indeed, I understand that nearly £5 million-worth of regional selective assistance grants have already been offered in 1996-97 to companies in Cornwall, generating more than £31.5 million of investment and creating or safeguarding more than 600 jobs.
A number of other sources of assistance include funding to help develop the local economy under objective 5b of the European Community's structural funds. The private-sector led £8 million Bodmin business park, currently under construction, is an excellent example of how that funding is providing opportunities for business and new jobs in Cornwall. Local partners can apply for challenge funds under the single regeneration budget, and there is the new local competitiveness challenge fund, which was announced in October, under which local partnerships can bid for support for programmes to improve the competitiveness of local businesses.
I gather that there has been some misunderstanding locally over the fact that the Rural Development Commission's rural business support fund for rural development areas has become part of the local competitiveness challenge fund, as was alleged in a local newspaper. RDC money has certainly not somehow been cut and therefore become no longer available to rural
areas. On the contrary, money formerly available from the RDC is part of the local competitiveness challenge, ring-fenced for rural areas--although that certainly does not prevent rural areas from bidding for further money that is available from the total pot for local competitiveness challenge.
Mr. Forth:
I cannot give way to the hon. Gentleman because I am going to try to answer all his points in the very little remaining time.
The hon. Gentleman will be aware that, in April, my right hon. Friend the Prime Minister appointed my right hon. Friend the Minister for Local Government, Housing and Urban Regeneration as Minister with special responsibility for the south-west, focusing particularly on Devon and Cornwall. He was given responsibility for co-ordinating Government policy towards the region and for taking forward a "new deal" for the area. That was in recognition of the distinct identity and needs of the region and is a clear demonstration of the Government's support for the south-west.
Since taking up his appointment, my right hon. Friend the Minister has been able to deliver on many of the key strategic issues identified by the West Country development corporation as crucial to the region's economic development. Such issues have included improving vital communications to the far south-west by, for example, securing the restart of work on the dualling of the A30 between Bodmin and Indian Queens and securing £650,000 of European Union money for a feasibility study to speed up train services between Bristol and Plymouth.
My right hon. Friend the Minister has taken a close interest in tourism--a key part of Cornwall's economy--and announced in November a pioneering project funded by South West Water to regenerate Newquay and other seaside towns. A Government-funded strategic study of tourism in the region is also under way, which will provide the region's tourist industry with the best possible analysis of where growth opportunities exist. I would therefore urge the hon. Gentleman to keep in touch with my right hon. Friend in the weeks and months ahead. I shall of course bring the hon. Gentleman's points to his attention.
I might add that I am aware of the perception that the west country generally gets a raw deal compared with, for example, Wales and Scotland, to which the hon. Gentleman referred, when it comes to big inward investment decisions backed by Government funding. Part of the problem is the lack of very large sites for major developments. None the less, my right hon. Friend the Minister has secured progress on the Broadmoor farm site near Saltash by removing the Highways Agency direction to refuse planning permission, thereby paving the way for serious negotiations between developers and the local council. He has also secured early progress on the disposal of Seaton barracks--a prime inward investment site which, although in Plymouth, offers the potential to provide many additional jobs to Plymouth and the surrounding area. In addition, he has announced English Partnership's £5 million factories first initiative, which will provide a stock of readily available units of more than 10,000 sq ft in Devon and Cornwall.
I know, too, that Devon and Cornwall Development International is working hard with the local authorities to attract inward investment. There have already been some notable successes--such as that regarding the United States company Harman International in Redruth--which have been backed by regional selective assistance funds.
The hon. Gentleman mentioned the low pay earned by his constituents. Low pay is of course a relative term. There will inevitably always be some people whose pay is lower than others. The fact is that real earnings have increased at all levels since 1979 and real take-home pay for the bottom 10 per cent. of full-time workers is 14 per cent. higher for a single person than in 1979. More important, low pay does not necessarily mean low household income because household income comes from a number of sources. A family may have more than one wage earner or receive earnings plus state benefits. Even the European Community has recognised that, in the UK, unlike in most EC countries, low pay is a relatively minor cause of low living standards. Here in the UK, the single main cause of low income is not having a job. The best way of helping the lower paid is surely through the creation of the right conditions for a growing economy and the removing of barriers to employment.
The most effective way of raising the living standards and prospects of unemployed people of working age is to help them to get to work. We set up a comprehensive range of measures to help people to provide a better standard of living for themselves through work. The new
jobseeker's allowance, for example, helps people to plan the most effective route back to work and creates a better framework of advice and support for the jobseeker.
We provide help through the benefits system to ease the transition from unemployment to work through such measures as family credit and the back-to-work bonus. The Government are currently piloting earnings top-up--an in-work benefit for single people and couples without dependent children--which makes working more worth while and widens the range of potential jobs for unemployed people. From April, the new child maintenance bonus will provide a bonus of up to £1,000 for people with care who leave benefit for work and who were receiving child maintenance while on income support or the jobseeker's allowance.
I hope that the hon. Gentleman will therefore accept that the Government recognise the difficulties that Cornwall faces and are responding to them--perhaps not quite in the way in which he has suggested, but in a way that will be more effective in the short, medium and long term. I hope that he and the local community recognise and support the important work that my right hon. Friend the Minister is undertaking, and that all local agencies, like those in London, will do everything possible to respond to the problems that he has drawn to the House's attention.
It being Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.
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