Examination of Witnesses (Questions 480
- 499)
WEDNESDAY 22 MARCH 2000
THE RT
HON RICHARD
CABORN MP, THE
LORD SAINSBURY
OF TURVILLE,
MR DAVID
EVANS AND
MR PAUL
MCINTYRE
480. If you dissipate an existing science base,
that will somehow or other create new scientific jobs elsewhere?
(Lord Sainsbury of Turville) No. We have put forward
some proposals for putting extra money into the north-west—
481. No. With respect, you are going to give
us a breakdown of that because it is very clear that you are not
talking about new money and indeed, if you are talking about 25
million, that is the gap the government is saying it could not
cover. You cannot have it both ways. Either you have the money
or you have not and I think your Department should supply us—we
are not obviously going to persuade you; your views are very different—but
we need from you fact. We need a breakdown on the moneys that
are supposedly going to be going into this—
(Lord Sainsbury of Turville) We can give you two bits
of information that would be helpful to you. One is what it would
additionally cost if we had no partners to run the Synchrotron
and the second is what are the extra moneys we are looking at.
We can perhaps on another occasion have a fresh debate about—
Mrs Dunwoody: Do not worry, my Lord. It is a
subject we shall return to with considerable vigour.
Chairman
482. Can I just press you on one issue that
alarms me? You point out that large numbers of scientists were
going to Daresbury. One of the problems for the north-west is
its image. Those people go; they stay there for brief periods
of time but they come away saying what an attractive area the
north-west of England is and they do a great deal to propagandise
that. We are going to lose all that and it means they are going
to go back to the Oxbridge sort of area which will reinforce the
view that the north-west is not attractive. What are you going
to do to convince scientists who do not often come to the north-west
that clusters and other developments in the north-west are very
attractive?
(Lord Sainsbury of Turville) What we are seeking to
do is to build on the economic activities of the clusters that
already exist in Manchester. It is a great pity to run down the
quality of the science which has already been done in the north-west
and the potential this has for creating new jobs. That is why
the new high speed computing facility was put into Manchester.
They have very considerable strengths in the biotechnology area
and the bio-incubator, which are in the centre of Manchester.
This has the real possibility of creating very serious numbers
of new jobs and economic activity.
Mrs Ellman
483. Lord Sainsbury, I am appalled at your comments.
I think they will be seen as arrogant and dismissive and will
fan the flames of the crisis that is ongoing in the north-west
and well beyond the north-west and which will now not go away.
I would like to ask you why the government took this decision?
Was this a government decision or was this the Wellcome Trust
telling the government what to do?
(Lord Sainsbury of Turville) If you have a partnership,
part of it is you have to take account of the views of your partners.
You cannot have a partnership where very large sums of money have
been put in by your partners without taking account of their views.
Clearly in that we had to take account of their views as to what
they thought the right thing to do was.
484. Did you take account of Wellcome's views
or did the Wellcome Trust in practice direct the government's
views?
(Lord Sainsbury of Turville) The Wellcome Trust cannot
direct the government. They are not in a position to do so. They
can state their views and the basis for what those views are.
485. In that case, why did your Secretary of
State, when he gave evidence recently to the Science and Technology
Committee, state very clearly that he believed that Daresbury
was the best place? It has become pretty clear since then that
it is the views of the Wellcome Trust which have dominated, not
the views of an independent government. What would you say to
that?
(Lord Sainsbury of Turville) He did at that point
believe that that was the right course of action to take. There
were then further discussions about the Wellcome position and
the French position. At the end of those, he came to the conclusion
that the right thing to do was what he recommended to the Prime
Minister.
486. What reasons did the Wellcome Trust give
your Department for why they threatened to pull out of the project
unless it was removed from Daresbury and put in the south-east?
(Lord Sainsbury of Turville) They had a strongly held
view that the right place scientifically should be Didcot. They
felt also that, as a charity, the main issue in front of them
was to do the best science and get the best base scientifically
for it.
487. Did they give you detail of this? Who gave
that information?
(Lord Sainsbury of Turville) That was given both by
the director of the Wellcome Trust and at one particular meeting
with also a number of the trustees.
488. Would that information be made available
to this Committee?
(Lord Sainsbury of Turville) I think we can tell you
that that was their view.
489. I am requesting that the information be
made publicly available.
(Lord Sainsbury of Turville) We can give you the details
of when that meeting and the meetings took place.
490. No; the information. I wish to know the
reasons the Wellcome Trust gave the government for its opinion
that it would withdraw from the project unless the investment
was taken out of Daresbury, where it is now, and—
(Lord Sainsbury of Turville) There is no question
about that. That view was stated not only to the Secretary of
State but in front of the select committee of the House of Commons.
The director of the trust gave his views and this is on the record
in the select committee in the House of Commons.
Chairman: On this issue, we need some further
information. We need the costings and we need what Mrs Ellman
has asked for.
Mr Blunt
491. How much extra would it have cost the government
to put this at Daresbury, not Oxford?
(Lord Sainsbury of Turville) Can we be precise about
the question? If the question is—
492. How much extra would it have cost the government
to put this facility at Daresbury, rather than at Oxfordshire?
It may well be zero.
(Lord Sainsbury of Turville) If it is a question that
the Wellcome Trust and the French were prepared to pay, whether
it was one site or the other, the answer is that the financial
appraisals marginally said it was better to be at Didcot, but
as far as I am concerned within the tolerances of these kinds
of appraisals. If it is a question of all the partners agreeing
it was one place or the other, it would financially, over the
20 year period, be slightly better to put it at Oxford, but not
significantly that you would base a decision on.
Mrs Ellman
493. The Cabinet Office has criticised the operation
of government policies in the regions for not working together
properly and for being ineffective. How do you see the role of
the DTI in terms of this operation in the regions and how you
are going to improve it?
(Mr Caborn) There are two reports. One is that the
PIU Report on government offices is welcome. What it is saying
there is broadly that the government has to get its act together
and I think the government is responding to that report in that
there is now the committee set up under the Cabinet Office and
all the ministries are reporting into that. It is still under
the umbrella of the DETR. In terms of the Regional Development
Agencies, you know very well that they put forward their strategies
in October to start addressing competitiveness and wealth creation
in the regions. They were turned round by government and responded
to by 12 January of this year. They are now working up the programmes
to deliver those. Running alongside that the two other important
elements are, one, the SBS, which will come on stream, and two,
the Learning Skills Council which will also come on stream this
year. Those three put together clearly will start addressing some
of the real issues that have been raised with us in terms of competitiveness
and wealth creation.
494. Do you think there are any lessons to be
learned about how you can bring different initiatives together
and relate them more effectively to the regions?
(Mr Caborn) Very much so. What the Regional Development
Agency have done in their very short period—they have not
even been alive for one year yet; they started on 1 April last
year so they are coming to their first anniversary—the impact
they have had on bringing together strategic thinking in terms
of industrial and economic strategy, what Lord Sainsbury has been
talking about here a little earlier, about how you can use centres
of academic excellence in a much more proactive way I think has
been demonstrated now by what the universities are doing in the
regions. In my own area, ten universities have come together.
They are working much more in a partnership in relation to business
and industry and commerce. That is now involved in very strong
partnerships and I think that is cemented again by what the Chancellor
did yesterday in acknowledging the role of the RDAs and the way
that he is talking about developing the venture capital, an area
that has been sadly neglected over this last period, particularly
the levels of 50,000 to about 150/200,000, which has been an area
that small and medium-sized companies have had great difficulty
in getting at reasonable cost and with reasonable back-up. They
are now addressing these issues. My view is that they will start
addressing that competitive agenda very effectively indeed as
the next few years unfold.
Miss McIntosh
495. You may recall Michael Heseltine launched
a business link as a one stop shop. Your Department now has tinkered
around and in view of Louise Ellman's question about criticism
from the Cabinet Office about overlapping agencies muddying the
waters, can you help the Committee how small businesses are going
to be helped to access a one stop shop when you have now divided
up again into a Small Business Service?
(Mr Caborn) I do not think we have divided up into
a Small Business Service. Let me say what my present target is.
Michael Heseltine was probably about the first minister that had
got any vision about actually running the regions, and it would
have been very effective indeed. Fortunately, he was the minister,
also, for the Thames Gate, which, again, I think, was far-sighted
as well. So we are building on a lot of what Michael Heseltine
put in place. I do not think the PIU said it was critical in that
sense, it was actually looking at how we could deliver government
services in a more effective way. We have responded to that report
now, as, indeed, have the Regional Development Agencies, which
are business-led boards which are addressing the issues in their
particular region, in terms of competitive skills, wealth creation
and how they can co-ordinate the assets of the region, whether
it be intellectual property , or skills, and how you can do that
in a much more effective way. So we are building on what Michael
Heseltine has done, and I have told him that, personally, myself.
496. You have mentioned the Phoenix Fund and
you do refer to it very briefly in the memorandum on the Urban
White Paper. £30 million has been allocated to this. Is this
new money in addition to what the Chancellor announced yesterday?
(Mr Caborn) What the Chancellor announced yesterday
is additional to what is in our memorandum. The billion he is
talking about is 250 million new money, 500 million from EIB and
then 250 million from the private sector. That is where the billion
comes from, in terms of the venture capital he is talking about.
497. Can I just be clear: how does one access
the Phoenix Fund if you are a small business? Do you have to come
direct to Business Links? Do you have to go through the Local
Economic Development Office of the local authority?
(Mr Caborn) It will be Business Links. Let me make
it perfectly clear, Mr Bennett, Business Links will still continue
as a name though it will be incorporated into the new SBS (Small
Business Service). Business Links is a brand name and will continue
to be operating, with the aim, as it were, of a one-stop shop.
That is the organisation that businesses will go to to get advice.
498. Minister, are you satisfied that in the
evidence that we have received, both written and oral, on the
Urban White Paper, there is a feeling that local authority Economic
Development Units should have more power, if you like, to develop
economic development earlier? Are you satisfied that they have
enough function and power at the moment? Or would you like to
see, through the Urban White Paper, that power increased?
(Mr Caborn) I think the Urban White Paper will be
addressing some of those issues. Indeed, the paper that has been
put forward by local government on the economic regeneration of
those areas is, I think, a fairly far-sighted paper. I have no
doubt that that will be taken on board in terms of the section
dealing with economic development. I think it is very important.
I think this comes back to the other point I made a little earlier.
How that links into land-use planning in terms of local authority
is also very important indeed. I think you now find a lot of local
authorities are reorganising themselves into land-use and economic
planning being in the same department and are now becoming much
more pro-active to rather than reactive to. I think, in that sense,
it is to be welcomed. I hope that that partnership, as I said
earlier, with the SBS will be forged at the local level.
Dr Ladyman
499. In your memorandum you say that you expect
to announce proposals for refocusing Regional Selective Assistance
on quality projects. Can you tell me what you mean by "quality
projects" and how that is going to work?
(Mr Caborn) The RSA was originally designed, and indeed
was dispensed, on the number of jobs created, irrespective of
those jobs. I think what we want to positively encourage is going
up the value added chain, and we will give larger grants for that
type of development. Let me also say here, Dr Ladyman, that we
do not dismiss the lower end of the chain. In fact, some of the
call centres, particularly in some of the more run-down regions
like my own in South Yorkshire, have been extremely helpful in
terms of getting people back into employment. So it will be a
mix of that. What we are trying to do is develop up the supply
chain, on the value added chains. Lord Sainsbury has indicated,
in terms of clusters and in terms of the development of the-high-tech
end, we believe we have got to refocus the Regional Selective
Assistance to try and attract both inward investment and, also,
develop indigenous investment as well.
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