Regional Development Agencies

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Andrew George: The hon. Member for Liverpool, Riverside was right to pull us back to setting the

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progress of regional development agencies against their objectives. She gave some good examples of projects in her region that are succeeding. The question is whether projects in the north-west—or anywhere else—would be more successful with or without the RDAs. As she rightly said, after only three years, it is too early to assess their development properly.

The purpose of the Committee is to compare the progress of RDAs with their objectives. I was disappointed that we did not receive any background information or reports that we could use to judge their progress. Searching in the Commons Library and elsewhere failed to produce attempts by other organisations to assess progress, and it is a disappointment that we do not have the materials that we require to do that.

I am disappointed that the hon. Member for Eastbourne is no longer in the Room. I was pleased that he had an opportunity to unburden his fantasies about Europe's conspiracy to take over all aspects of our lives. He thinks that decentralisation is merely centralisation in another form and that it hands powers to Brussels, Strasbourg or elsewhere. Perhaps we will have an opportunity later in this debate or in another debate to scrutinise properly some of his rather fanciful claims.

It is important to recognise that the robust, candid friend, which is how Liberal Democrats always attempt to portray themselves in all of their activities, is different from the sycophantic lap-dog, which is the kind of image that I believe the Conservatives want to present. Therefore, we need a debate to challenge robustly the claim that the Government's devolution agenda, which Liberal Democrats support in broad principle, is in fact a stalking horse for handing powers over to a centralised Europe. I am sure that the Minister agrees that such a claim needs to be tackled.

In his opening remarks, the Minister claimed that the purpose of RDAs is to establish strategies for the regions from the ground up, not from the top down. I question whether that is what RDAs are actually doing. The Minister acknowledges the welcome fact that the chairs of each of the RDAs have regular six-weekly meetings with Ministers. They are accountable to Ministers for delivering Government policy and funds. As such, I question the extent to which they are primarily bottom-up organisations that draft strategies from the ground up.

As the Minister pointed out, what was called a regional chamber is now a regional assembly in the south-west. I find it rather fatuous to call such bodies regional assemblies. It gives them the aura of democratic respectability, which clearly they do not have. The regional chamber in the south-west set up a select committee to scrutinise the progress and success of the RDA. The hon. Member for Eastbourne did not hear my riposte—I was not sure whether he was about to return to the matter of Europe—but I agree with some of his sentiments about regional chambers. In the main, they are talking shops and populated by agreeable people who, I am sure, have a nice time. They have no democratic legitimacy; they have little to

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do or to achieve on their agenda. What little credibility I considered they had was destroyed when the ''assembly'' in the south-west claimed that it was down to its efforts that Cornwall and the Isles of Scilly succeeded in achieving objective 1 status. It implied that it did not at the last minute get in the way of the clearly successful plan of the Government and Cornwall to address decades of economic decline—to the point at which GDP in Cornwall became massively lower than the European average. It is at the bottom of the league table in the United Kingdom. It did not step in the way of Cornwall achieving objective 1 status, but that it achieved it for us was fanciful.

The extent of the regional assembly's scrutiny is demonstrated in a letter that I received from its chief executive on 10 September last year. The questions that it set out for the select committee were:

    ''Do the regional outcomes and targets which the RDA will be working towards have the support of the Region and its sub-regions?

    How will the Corporate Plan seek to complement the role and priorities of regional and sub-regional partners?

    How will the Corporate Plan seek to ensure that its proposals are consistent with the national, regional and sub-regional policy framework?''

What worries me about the inquiry and the process of scrutiny is that they are process-driven, not product-driven. They are concerned mainly with the processes of economic development, and not with assessing whether the RDA has been successful and has achieved any discernable economic outcome in respects of jobs created or jobs sustained and improved competitiveness within the region. I suggested that the assembly should look at what the RDA has achieved, which would not otherwise have happened over two or three years. What has it done as a body, which would not have otherwise been undertaken by previous Government agencies? What has it added? How has it responded to those problems that often arise which require a greater than local response—a regional response—and which clearly demonstrate that the RDA is capable of responding to a crisis when it occurs?

I suggested earlier to the Minister that RDAs should have responded to the serious crisis in transport, certainly in the south-west. Over the past two years in particular, many regions have been affected for various reasons, including the Hatfield crash and Railtrack's failure to respond and invest in the infrastructure. The south-west was also affected by flooding. The RDA claims to be the pre-eminent body for economic development of its region, and here was an opportunity for it to show leadership, to bring partners together, and to start rattling cages and get things moving. Although that is its role, nothing happened.

I also suggested that the select committee should consider what benefits the RDA has achieved since it was established, apart from channelling public funds, that would not have occurred anyway. The committee has addressed none of the questions about additionality that an accountable Parliament would wish to raise in such a scrutiny process.

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The Minister cited the example of the Rover taskforce, which I am sure was successful. However, surely another agency or Department could have brought partners together to achieve that result if there had been no RDA in the area? I would like to be told that everyone else would have sat on their hands had it not been for the RDA pulling that taskforce together. It would be interesting to know whether that is the case.

Will the Minister say whether there are internal contradictions in the way in which RDAs operate, as I implied in an earlier question? His predecessor, who was largely responsible for setting up the RDAs, made it clear that a primary concern was the failure of regions outside the south-east to pull themselves up by their bootstraps and to perform competitively along with the rest of the economy. The RDAs were specifically aimed at addressing that. It may be inevitable that improving GDP still further and trying to crank up the competitiveness of the south-east can be achieved only at the expense of other regions. A concern is whether certain RDAs need to be set different targets. The Minister's response reassured me, but I would like to see it made more explicit in the actions of the RDAs in London and the south-east. Internal regeneration is a priority in Thanet and other self-evidently impoverished London localities that clearly deserve further attention.

I have another concern that I hope the Minister will address. Several regions in England have complained that the Welsh Development Agency has successfully poached jobs from them. We need to ensure that the internal investment intentions of RDAs do not result simply in the poaching of jobs from one region to another. Using public money to sustain the poaching of jobs from one region to another would result in a nil sum gain overall and would not greatly further the Government's aims of achieving economic regeneration throughout the country.

The hon. Member for Eastbourne rightly raised the question of regional identities, but when we are talking about economic development on the scale that is necessary for populations of about 5 million, it does not matter where the boundaries are drawn or the head office is situated. As long as the organisation provides professional advice and channels Government public money efficiently, what it calls itself, where it is based and whether it has an identity is not an issue. It is a largely functional, not representative body.

On the overall strategy, I had some debate with the chairman of the South West of England Regional Development Agency, Sir Michael Lickiss, when he was first in post. I will be pointing out that we had a disagreement, so I should also make it clear that I dissociate myself from any of the comments made by the hon. Member for Bridgwater (Mr. Liddell-Grainger) about him in his Adjournment debate on 12 February. I respect Sir Michael Lickiss enormously and thought that the hon. Gentleman's comments were out of order.

From my discussions, it was clear that one of the RDA's top priorities was to establish a regional identity—this addresses the point raised by the hon.

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Member for Eastbourne—and a regional brand for produce from the south-west of England. Concern was strongly felt in Cornwall that such a move was not just unnecessary, but counterproductive to the attempts that Cornwall was making to drive its own strong brand image. As a Cornish Member of Parliament, I believe that Cornwall has a strong brand image, with Cornish cream, ice cream and whatever. My impression is that people generally know where Cornwall is and have a favourable view of the place. They think that the sun shines most of the time down there, which it does mostly.

In such circumstances, it would be highly counterproductive to tell one part of what is a synthetic region that it was not entitled to develop its own brand image, but that it must instead fall in with an image developed by the RDA. However, that was the approach taken by the South West of England Regional Development Agency for some time. It wanted to establish its own image because it was concerned that the south-west region did not exist in the minds of people. It wanted to create an identity, which is hard work and counterproductive when parts of the region already consider that they have identities of their own. To be fair to Sir Michael Lickiss, some time after our disagreement, he accepted the point and, to demonstrate that he is an honourable man, he came round to my way of thinking. He now agrees that the RDA has a role in co-ordinating efforts at trade shows for companies and brands in the region, but not in imposing a brand on an unwilling business base. The Minister should consider that point carefully.

The Minister responded as best he could to the question of complexity. I welcome the Government's efforts to bring more agencies and funding streams into the RDAs. Reducing the number of agencies, funding streams and level of complexity of economic development and match funding is unquestionably welcome. He may like to know that I secured an Adjournment debate in January 2000 on the future of objective 1 areas, in which I raised a question with the then Minister for Trade—who is now the Minister for Sport—about applicants who identify match funding for themselves. I asked him to produce a directory of all the funds that would be eligible for European objective 1 match funding. I was told that that could be done relatively quickly, but I am still waiting for that document. I understand that a draft was circulated by the Department of Trade and Industry in the Government office for the south-west, but as far as I am aware that document has not been published and made available to the public.

This week, the Financial Times referred to a cross-party report by a committee of the Greater London Authority. The article said that the report claims that there

    ''is a 'minefield of overlapping schemes' that are run by organisations struggling to keep up with changing priorities.''

The report, which all parties support, also says that much of the regeneration programme is

    ''confusing, often with no clear links between different agencies working in the same area''.

It continues:

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    ''There is no intelligence base. Previous programmes have not been analysed or evaluated, and existing information on outputs is unreliable . . . We are concerned that current regeneration initiatives are being planned in a vacuum.''

I believe that a cross-party report by the GLA is worth considering and addressing. I know that people in other regions will say that the report's findings have resonance in their region.

I turn to the progress of RDAs. I have read the most recent annual review of the South West of England Regional Development Agency. It was originally set absurdly low targets, although last year's targets were more realistic—all of which it has failed to meet. It missed the target of total jobs created or safeguarded by about 2,000. It has attracted private sector finance that is £13 million lower than the target that it attempted to meet. It has failed to achieve its target for new or refurbished work space by about 80 million sq m. If we are to judge RDAs, the Minister must address reports that show that RDAs are not achieving their targets.

Businesses in my area are worried about the lack of information from both Government offices and RDAs on the private investment programme to replace that vetoed by the EC at the end of 1999. Businesses have been told that they may apply for the programme, but that they must meet the project's regional priorities. The term ''regional priorities'' is new to businesses. They asked the RDA what the priorities are, but they are yet to receive an answer. That is not helpful. The project was started in January this year, and when businesses apply for it they must demonstrate that they meet the regional priorities that were set. However, businesses have not been told what the regional priorities are, and they are not clear on how the process will be assessed or how they can appeal against decisions with which they are disappointed.

Similarly, regional selective assistance has worked reasonably well in certain sectors through Government offices, but I understand that it will now be delivered by RDAs. A range of questions relate to that, but I will not detain the Committee any longer on the matter. I will write to the Minister with the questions that businesses are asking me about the delivery of regional selective assistance within their regions.

The hon. Member for Eastbourne is right that we must broadly define what regions are, but that is not what this debate is about. I am concerned that one can have top-down defined regions that are established on the basis of bureaucratic convenience rather than community identity, which is a problem that must be dealt with. To some extent, we discussed that matter in the previous sitting in December 2001.

I hope that the Government will demonstrate in the forthcoming White Paper that they are prepared to be flexible. They should try to ensure that voters do not stay home in their droves because they are faced with regional boundaries and regions with which they cannot identify. I hope that the Government have learned from the fiasco of their attempts to establish city mayors, and will take a more flexible approach, listen to what people on the ground are saying and be prepared to reflect boundaries and regions with which people can identify.

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We must have devolution. It is unfinished business and, despite what the Conservatives say, it is clearly what many people want and is a logical extension of Government policy. The Government must simplify the process and make it more transparent, and, when we have regional government, dovetail it with the RDAs. Businesses and communities want a single point of entry and a single application form rather than, as I described earlier, needing a PhD to understand all the complexities of the Government's uneconomic delivery systems.

4.12 pm

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