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Mr. Bob Russell: Successful minority sports.

Kate Hoey: Successful minority sports, then.

I pay tribute to the Amateur Rowing Association, whose success this year has not come about overnight. It has organised itself properly, and I would hold it up as model of a governing body that is working with the grass roots. Its "Project Oarsome" has been a terrific success throughout the country, introducing young people still at school to rowing, but it also has a very clear idea of where it is going and what it wants. Its members work together as a team, and they are a credit to minority sports--if we have to use that term.

Let me say a quick word about football transfers. As my right hon. Friend the Secretary of State made clear, we take them seriously, and we are working closely with the football authorities. It is important for football to speak with one voice, not just in this country but in Europe generally. I am pleased that the UEFA-FIFA joint paper has now been submitted, although it is a pity that it took so long: they knew that this had been coming for a long time.

Mr. Greenway: The clubs did not.

Kate Hoey: The hon. Gentleman is right, but that was neither the Government's nor the clubs' fault.

At the EU Sports Ministers meeting on Monday, there was a real feeling that this was an issue that we had to fight. There was particular support from the German Minister, but there was also support from Ministers representing a number of other countries. We are speaking with one voice--and, as hon. Members know, the German Chancellor also made a statement. What makes football in this country is the fact that it is spread throughout the community. We must support the smaller clubs in whatever way we can.

My hon. Friend the Member for Sittingbourne and Sheppey (Mr. Wyatt) made a number of points, about which I shall write to him. He had some interesting ideas about Olympic clubs and ambassadors. It is important that we should not create another layer of bureaucracy, but some of my hon. Friend's ideas should clearly be considered.

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A number of questions were asked about the huge number of organisations involved in sport. Given the amount that my Department and the Department for Education and Employment spend on sport--indeed, there is spending throughout Departments; some of the Home Office's anti-drugs initiatives may be sports-related--there clearly needs to be more co-ordination in regard to how the money is spent. We have therefore announced the establishment of a new forum, the strategic alliance for school sport. It will constitute a partnership between the Youth Sport Trust, which is predominantly the delivery mechanism for DFEE initiatives, and Sport England, which is predominantly the delivery mechanism for our Department's initiatives. They will come together with representatives from the two Departments and the new opportunities fund.

That alliance will bring together the key stakeholders in the future development of sport in schools. It will help to ensure that all the money is spent in the best way. It will be chaired by Trevor Brooking, chair of Sport England. It is another way of the two Departments working more closely together and of ensuring that what one Department is spending does not contradict what another Department is spending.

Mr. Greenway: I am grateful to the hon. Lady for that important and useful clarification, but can she say at what point the local government organisations will be involved in that process? It seems that they will very much be part of the delivery of that.

Kate Hoey: Local government has an important role to play in the delivery of sport. As we know, huge amounts of money go in, but this is specifically money that is related to schools sport. It will not be just a simple bidding process, where every local authority puts in for a certain amount of money. We must look at where the need is and which area has not had any support. That is the sort of thing that that body will do, but I can assure the hon. Gentleman that I meet regularly with the Local Government Association to discuss sport. There is an important role for local government. Indeed, in "A Sporting Future for All," there was more mention of local authorities and local government than there had been in any other sporting document. We cannot deliver our sporting opportunities without local government being involved.

I think that I have covered all the main points. We have made great strides. There has been an acceptance that there has been a lot of neglect in certain areas of sport over many years. We are now putting into place a funding system and funding that will be sustainable and long term--not just a one-off amount of money. We must see it long term. We cannot get a sporting nation that will continue to be successful at the top and become even more successful if we do not get the basis right, if we do not get the foundation right, and if we do not get it right in our schools. We are beginning to make those strides.

I beg to ask leave to withdraw the motion.

Motion, by leave, withdrawn.

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Teesside Development Corporation

Motion made, and Question proposed, That this House do now adjourn.--[Mr. Dowd.]

2.12 pm

Dr. Ashok Kumar (Middlesbrough, South and Cleveland, East): I thank you, Mr. Deputy Speaker, for allowing me to have this Adjournment debate. I return to a subject that I have raised in the Chamber and on which I have tabled many parliamentary questions: the murky legacy to my constituents and to the wider public of Teesside by the Teesside development corporation.

I have often criticised the attitude and ethos of that former urban development corporation. In an Adjournment debate in January 1998, I raised the circumstances that preceded the winding-up of the body. I have echoed, and will echo, the views of many people on Teesside that TDC played fast and loose with public moneys and public investment. Those moneys were not small sums.

Over TDC's 10-year lifetime, many hundreds of millions of pounds were channelled through the organisation. Playing fast and loose with large sums concerned many on Teesside and they have continued to raise concerns in the local media, including The Northern Echo and Evening Gazette. Those fears were crystallised by my meeting on 15 December 1998 with the then Under-Secretary of State, Department of the Environment, Transport and the Regions, my hon. Friend the Member for Mansfield (Mr. Meale), at which a dossier of allegations and fears about TDC were shared with him. I thank him and his successor, the Minister for Local Government and the Regions, for ensuring that the DETR's internal audit section was tasked with the job of examining those fears and allegations and pronouncing on them. It was obvious that, if the allegations had substance, action would be taken.

I regret to say that the completed report--which is now in the public domain and a copy of which is in the Library--is a document that, in the words of the Middlesbrough Evening Gazette, raises "more questions than answers". The report deals with matters and raises issues that most reasonable people would think demand further probing, and I should like to deal with those elements of the report in this debate. I also suggest that, on the basis of the incomplete report, the Minister should further investigate TDC's activities.

I do not doubt that the audit was conducted with good intentions. However, although I realise that the time taken to complete the report--from February 1999 to October 2000--was necessary to conduct interviews, the finished report laid on Ministers' desks for a very long time. It was not released until June 2000, so that, with the ensuing summer recess, only now is it possible to debate it.

I suspect that civil service advice has been that it is best to let sleeping dogs lie. I realise that some people will argue that TDC and all the other former urban development corporations no longer exist, and that only little good will come from raking over allegations of possible corrupt practices and maladministration. Such an argument, however, is fatally flawed. The true story of TDC's failings and malpractices must be exposed, especially as we are again considering an urban

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regeneration company for Teesside. It is extremely important that the lessons of TDC's mismanagement be learned.

TDC took very easy options in deciding to erect an out-of-town shopping centre on the former Stockton racecourse and to build a marina at an empty dock in Hartlepool, but more difficult issues were not addressed. After 10 years, the old Middlesbrough dock area, next to the new Riverside stadium, still looks like a world war battlefield, and large tracts of contaminated land adjoining the Teesport dock have been completely ignored. Despite the exuberant promises that TDC made using its massive publicity budget, it did not accomplish many of its objectives. The nature of its high-handedness and its chief executive's management were clearly exposed by the DETR's audit team.

I should like to examine some of the allegations and make some suggestions about possible action. Although some of the conclusions in the report merited follow-up action, so far they have been ignored.

The audit team was given the names of individuals, organisations and companies and invited to question them. Section 3.3.1 of the report details allegations that moneys were used to facilitate the establishment of an environmental body, the Teesside Environmental Trust. By a miraculous coincidence, the board of that body contained various former TDC board members and favoured contractors.

In section 3.3.4, the audit team said that the commitment of moneys for such a long time

If such a verdict were delivered on a local authority, for example, intervention by a district auditor would quickly follow. I do not believe that any other public body would have been let off as lightly as TDC has been.

Section 3.4 of the report deals with allegations that assets were doubled-counted by both TDC and Middlesbrough football club in the development of the new Riverside football stadium. The auditors lamely concluded that the files that would shed light on the matter "were not available", and that Middlesbrough football club's files "were not readily available". Are we really saying that the files on one of the most prestigious, high-profile projects in which TDC was involved were not available and that a premier league football club could not or would not accommodate the request of a team of DETR investigators? As PricewaterhouseCoopers acted as auditors of the football club and of TDC, surely it would have been a simple matter to have interviewed the staff involved in both audits.

Section 3.5 of the report contained the serious allegation that City Grant, a Government-backed and audited financial instrument, was misused by TDC in relation to a land development for industrial units. The report concludes that two tranches of cash were granted to a developer, Foster Church Business Centre Ltd. in Billingham. The size of the first grant was not disclosed; the second tranche was for £2.18 million. It seems that the agreement made in 1992 between TDC and Foster Church stated that the development was to be some 81,750 sq ft and that a grant of £2,188,459 would be given to help it happen.

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No works were carried out on the site. The developers went bust and the site was sold by the receivers for £1.2 million. What did the audit team say about that? It said:

and were unclear about whether the second tranche had been paid as

Any other public agency that had mislaid £2.18 million would by now have received serious attention from its auditors, if not from the police. It gets worse. After the centre went into receivership, the Financial Times in April 1995 advertised the building for sale and advised potential purchasers that it had a net area of some 48,000 sq ft. It appears, therefore, that TDC gave a grant for a building that ended up much smaller and cheaper than that at which the grant offer was originally pitched. Again, no one seems interested in investigating the matter.

Section 3.6 of the report contained the allegation that the chief executive of TDC had failed to declare an interest as a potential chair or director of a "Tall Ships Centre" that was to be sited near the former Middlesbrough docks, before the determination of a planning application that would help to release the cash needed to bring the centre into being. The auditors say that they "were told of this", but it was not just a vague verbal allegation--it was admitted as such by Mr. Hall under questioning by the north-east regional Sunday paper, the Sunday Sun. A copy of the article was given to the audit team, but the team says that

presumably as the tall ships development never took place. However, the intent surely was there.

Another allegation contained in section 3.7 of the report was that there were fire sales of land immediately before TDC was wound up. The sales were precipitated by the fact that without them TDC might have gone out of existence with more liabilities than assets.

It was further alleged that these deals were made without full market testing of site value and without proper advertising. Again, it seems that the audit team did not or could not talk to the principals involved in these deals, which could have short-changed the taxpayer.

There is no evidence that the audit team talked to the Commission for the New Towns or the national office of English Partnerships, the residuary body. The audit team says in its conclusion that because TDC

Again, I can conclude only that this would not mean that possible maladministration by a local authority reorganised out of existence by the recent local government review would not be looked at by the local government ombudsman.

It was common knowledge on Teesside that the shredding of documents was taking place on a massive scale at TDC's Stockton headquarters. Unfortunately, the auditors did not seem inclined to ask why that occurred or whether the huge gaps in files that they commented on so often in the body of their report had occurred because of those practices.

There seem to be other huge gaps in the record about who exactly the auditors talked to. There is no evidence that they talked to the Commission for the New Towns or

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English Partnerships or to the civil servants at the Government office of the north-east who were responsible, at least in theory, for oversight of TDC. There is no evidence that they talked to TDC's own solicitors, Richardson, Boyle and Blackmore.

I have a list of questions that have to be asked. Was a list obtained of disposals and acquisitions for the final months of TDC? Above all, there is no evidence that the auditors talked to Duncan Hall, TDC's chief executive; to Sir Ron Norman, its chairman; or to the ex-employees of its finance department. Today is the ideal time to ask my hon. Friend the Minister those questions. There is a need for totally open and transparent answers.

Even now, after the publication of the report, fresh stories are coming to light. Recently, our local paper, the Middlesbrough Evening Gazette, reported that English Partnerships had to pay £2 million to get itself out of the mess left to it by TDC.

TDC started life in office accommodation in two blocks in Middlesbrough, but after buying those premises it decided to move to bigger premises, Dunedin house, on the Teesdale business park in Stockton. There, it entered into a 25-year lease from 1991, at a rent of £310,525 a year. The former premises remained empty. Needing cash to balance its books, it decided to market the properties; but it was also committed to paying rent on the empty properties at a rate of £124,000 a year. Those liabilities transferred to English Partnerships on 7 December 1999. It had to buy back the Middlesbrough properties at auction for £1.15 million and to pay the owners of Dunedin house another £1 million to get out of the lease.

The people of Teesside need an explanation of what happened and how. Existing and potential board members of quangos need to be aware of what they can and cannot do. They need to be constantly reminded of good practice and of what can happen when the organisation's objectives override good governance.

I believe that there is still time for that to happen, and I appeal to my hon. Friend the Minister to recognise that the audit report is incomplete and that far more thorough work must be done by the National Audit Office. I believe that the matter should also be examined by the Public Accounts Committee. I have already written to the Chairman with that request, and I look forward to his answer.

Those are the actions that I want to see, and I believe and hope that my hon. Friend will now understand why further work is needed.

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