Regional Economic Performance and Imbalances

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Several hon. Members rose—

The Chairman: Order. If all hon. Members are brief, everyone who wants to speak will be able to.

3.23 pm

Mr. Jim Cousins (Newcastle upon Tyne, Central): I take the points made by the right hon. Member for Berwick-upon-Tweed and my hon. Friends the Members for Liverpool, Riverside (Mrs. Ellman) and for Wansbeck, but this may not be the right occasion on which to rehearse the facts of our situations. At the end of a Parliament, perhaps it is more sensible to consider the politics of the issue under discussion.

One of the most telling points was made by my hon. Friend the Member for Wansbeck, who reported that the Barnett formula was cropping up as a topic at quiz nights in working men's clubs in Northumberland. That is a reminder that issues that were the inconvenient obsessions of a handful of people for many years are now gathering momentum as issues that cannot be disregarded. Following the remarks of my hon. Friend the Member for Sittingbourne and Sheppey, I accept that that does not apply to all parts of the country, but in some parts those issues are now the stuff of real practical politics, not simply the subject matter of articles in learned journals. They are not simply the kind of thing that people talk about at seminars and social occasions. We are discussing something that in regions such as the north east is now a significant issue of practical politics.

In the next Parliament, the people whom we represent will have views and opinions on the issue which they will insist that we express. They feel, rightly or wrongly, that their needs go unrecognised in the mechanical distributions of resources between the regions and nations of this country, and they will want those needs to be met. They will insist on a greater share and a greater recognition of their needs, which I hope that the Minister and her colleagues will take into account.

We are no longer talking about something relatively obscure. I had a discussion about the Barnett formula with a senior member of the Cabinet who said, ``Why are you talking about this? It is like the Schleswig-Holstein question; anyone who understood that either went mad or died, apart from Lord Palmerston, obviously. No one understands it.'' If I share with members of the Committee the information that I was talking to a rather Palmerstonian figure they will understand.

We are talking about something on which people have views and opinions. People have unmet and unrecognised needs, and unrealised opportunities. People see a hidden potential that cannot be unlocked on the present basis and they will insist that that is recognised in the next Parliament and that practical measures on devolution or resources are undertaken to meet those needs.

My hon. Friend the Member for Sittingbourne and Sheppey comes from a different part of the country where the matters we have been discussing, and the way in which they are discussed, have a different shape and form. He must accept that in some parts of the country views are forming and hardening. There is a political momentum for change, which must be recognised, but not every part of England will move at the same pace. I hope that my hon. Friend will see that it is sensible to allow that to happen; it should not worry or alarm him and those whom he represents or cause him to want a rigid formula to be imposed.

I look forward to many more discussions with my hon. Friend, but there may be considerable difficulty because some of us come from parts of the country where people feel that the issue cannot be ignored for much longer. Needs must be met and people will expect us to deliver that in the next Parliament. I hope that my hon. Friends who represent other parts of England will accept that my argument is not intended to threaten anyone, to beat anyone over the head or to be a means of gaining an advantage. I hope that hon. Members will recognise that we are expressing the strongly held and genuine views of many of the people whom we represent. We cannot afford to ignore them.

3.29 pm

Mr. Austin Mitchell (Great Grimsby): The debate is really about regional imbalances and, therefore, about money. As my hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cousins) said, these are now matters of public debate. People know and feel resentful about the different levels of spending in different communities. That is one reason why regional feeling is growing; it was bound to happen. As soon as we started developing regional institutions and structures, the information about spending levels seeped out. It is now well known, thanks to the work of the Campaign for Regional Government in Yorkshire, that public spending per head is £1,047 less in Yorkshire than it is in Scotland. When we learn that we would need £5 billion to bring public spending in Yorkshire up to the same level as in Scotland, it produces a real sense of grievance. My hon. Friend the Minister said that spending for the RDAs has increased and will increase. We are all grateful for that—it is important—but spending on regional development is still £330 million more in Scotland than in Yorkshire.

We have to keep crying that from the rooftops, because funding is a question of power. As the right hon. Member for Berwick-upon-Tweed said, because devolution has occurred and Scotland, Wales and London have devolved structures, they also have platforms to put their cases more powerfully and come to deals with the Government. He pointed out that the platform that the Mayor of London has from which to talk on equal terms—very cleverly, I must add—with the Government about the public-private partnership plan for the tube was achieved by the kind of devolution that we are discussing today.

We need a platform such as that in Yorkshire and Humberside, and devolution for Scotland and Wales makes it more necessary. First, we are competing for a diminishing amount of footloose industry; the competition is now intense. Secondly, we are competing for public spending. Thirdly, the way in which the devolved structures are developing allows them to apply finance to their own purposes. My hon. Friend the Member for Scarborough and Whitby mentioned the fishing industry. Scotland has allocated £27 million to support its fishing industry and, if it chooses, can spend nearly all of that on decommissioning. Compare that with the pathetic £6 million allocated by the Government to the English industry, which is 30 to 40 per cent. of the entire British fishing industry.

Mr. Quinn: The irony is that some of the skippers from Whitby, whose boats are registered in Scotland, will benefit more from Scottish devolution than from the lack of devolution for Yorkshire and Humberside. That is how the formula will apply for compensation to the fishing industry.

Mr. Mitchell: I am grateful for that intervention. In the Select Committee on Agriculture yesterday, the point was made to the Minister responsible for fisheries that a steady flow of English vessels that are registered in Scottish ports will go north to collect the dosh and, perhaps, to decommission. The point was not answered, but that looming problem will be difficult to resolve.

The case for regional government and devolution is strong. It will be a major issue in the next Parliament in a way that it was not in this one, because devolution for Scotland and Wales held centre stage. I make only three caveats, which we must bear in mind. The first is that devolution and or regional government must be strong and effective. My slogan in such matters is ``What Scotland gets, we need.'' It is no use offering people in the regions a watered down package of, shall we say, petty devolution, because it will not be worth voting for. People will vote for and on something that has the potential to improve their lives.

It is interesting that the much weaker—in many respects, pathetic—devolution structures conceded to Wales were carried by a majority of only 7,000, whereas, in Scotland, there was turnout, interest, and a big majority. Scotland got an effective system of devolution; Wales did not. That must be borne in mind when we come to the devolution to the English regions. My hon. Friend the Member for Newcastle upon Tyne, Central mentioned his hopes for a referendum. We do not have to put all our eggs in the referendum basket. It would be comparatively easy for the north-east to win a referendum for devolution and regional government. To achieve that might be more difficult in other areas that are slightly behind the north-east in that regard, such as Yorkshire and Humberside, particularly if the Tories choose to oppose devolution for those regions. They always oppose such proposals initially, and subsequently accept them and praise them as marvellous ideas.

We should not tie ourselves to the concept of a referendum. There are other means of expressing and developing consent. My hon. Friend the Member for Sittingbourne and Sheppey made a telling point about an English Parliament and regional representation. Each region need not have the same version of devolution. A variable geometry structure could be introduced. That is the system that Spain has adopted. Its regions take two decisions: first, whether they want a regional government, and, secondly, what form it should take and what powers it should have. We should move swiftly towards that system by introducing a measure early in the next Parliament. That would allow us to get on with the job of setting up regional structures, and of creating accountable and democratic systems for all the regional institutions that we have established, such as the learning and skills councils, the RDAs, and the regional offices.

I welcome today's development, although it has been somewhat belated. The right hon. Member for Berwick-upon-Tweed said that 24 years have passed since he sat on the previous Committee. A quarter of a century has passed. Today, we are standing in the foothills and looking up at the mountain of regional government, which lies ahead of us. We will climb it, and, from the summit, we shall see a view of the regions. We might not enjoy a view of the promised land immediately in the next Parliament, but it will, eventually, become visible. The process that has begun today must continue.

3.35 pm

Sitting suspended for a Division in the House.

3.50 pm

On resuming—

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