Regional Development Agencies

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Alan Johnson: Given that I spent 20 minutes introducing this debate and have answered questions, I shall not detain the Committee long. I shall focus on the three contributions without going over points that I made in my opening speech.

The debate may not have added to the gaiety of the nation. However, to respond to the hon. Member for Eastbourne, we should not judge the importance of issues by the number of hon. Members who attend Committees such as this on a Thursday afternoon when there is a one-line Whip. We would have a bizarre view of political priorities if we were to determine issues on that basis.

It is fair to say that this, like many other issues—local government, for example—does not set pulses racing. It is not the type of issue that people raise on the doorstep. Of course, nobody suggests that a bottom-up rather than top-down approach leads people to hold street parties to celebrate having an RDA and input into its economic strategy.

The hon. Gentleman's contribution, efficient and eloquent as ever, was rather blasé. It could be summarised as, ''Constituents do not care about this issue; it is all a plot to set up a Europe of the regions, and there has been a bit of a ruck in the north-west''. That was it, which is a shame. I am especially keen to see a consensus. We want the Conservative party on board. For example, Allan Willett tells me that, in one of the few areas in his region that has a swathe of blue, Conservative Members are having difficulty. He knows that they want to engage, but it is against their party policy and they feel encumbered by that. I would like to try to persuade Conservative Members to change their view—to go through the process of Letwinisation, so that they can look afresh at the issue.

The Conservative party's stance on all the devolution issues is changing, because it had to change. Their approach to London—leaving London as the only major city in the world without an overarching authority—had to change. Their approach to Scotland had to change, because it was so out of kilter with what people felt: they were left without a single Scottish Member of Parliament, although they have got one now, and they have some Members of the Scottish Parliament—but only due to the list system, courtesy of proportional representation. They also had to change their approach to Wales, for similar reasons.

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I cannot pretend that there is a huge tide of opinion in favour of regional development agencies, but there is a broad consensus about decentralisation. That stops at the barrier of devolution, so far as England is concerned. However, to pick up a point made by the hon. Member for St. Ives, we need an overview, and I shall look at his Adjournment debate of January 2000.

It is worth recognising that, before Christmas, the CBI compiled a comprehensive report on the regional development agencies. It stated:

    ''The RDAs provide a much-needed opportunity to give strategic direction and coherence to efforts to promote the economic development of the English Regions.''

It also said:

    ''we believe the RDAs deserve the solid support of all actors in the regional economies . . . It is right that the RDAs should be set tough targets clearly based on results.''

The report makes 10 constructive suggestions. Its main point—in the language of the introduction by John Cridland—is that we were promised a lion and we got a mouse. However, it accepts that RDAs were not fully developed in the first two and a half years—that period was one and a half years in London, when the report was compiled in December—and that they were merely administering predetermined programmes.

The chambers of commerce take a similar view. Local business people think that the regional development agencies are a good idea, but they say, ''Now, it is time to deliver.'' That is in line with the CBI report. They say, ''Now, we want to see outputs: so far, all we have seen are a lot of glossy documents and brochures and strategy documents.'' However, to be fair to the RDAs, that was largely their role in the first couple of years.

The Conservative party should look again at the issue. There is no conspiracy here. On the one hand, people are accused of wanting to centralise all of the power in Brussels, and on the other hand they are accused of wanting to have a Europe of the regions. Perhaps we missed a trick after the second world war. We were instrumental in setting up the Länder system in Germany and we signed the European declaration on human rights, but did not put it into United Kingdom legislation.

One of the major aspects of the matter under discussion is its potential to help areas and regions outside the south-east and London—such as the constituencies that almost all the Labour Committee members come from. A feeling that there was a north-south divide led to a drive in those regions and areas that something should be done to allow them to recover from some of the devastation that they had suffered because of the collapse of traditional industries, such as coal and steel. Therefore, it is wrong to say that, because it is not an issue that people raise on the doorstep, it is not important in terms of the future of the country.

I do not know what happened with regard to the ruck in the north-west—or even what was being quoting from. Naturally, there will be tensions—the hon. Member for St. Ives pointed to tensions in the south-west—about how to take this process forward.

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All I ask is that Members of Parliament engage with their RDAs, and that the RDAs become engaged with their Members of Parliament. That is a fair criticism, and the RDAs accept it. However, for goodness sake do not do what the hon. Member for Bridgwater (Mr. Liddell-Grainger) did, which was to call for the resignation of an RDA chairman whom he had not met, nor spoken to, nor engaged with in any way, because that is unfair to individuals who have, by and large, done a tremendous job.

I also wish to mention the success of the UK economy—not only with regard to the latest statistics. To refer to a different issue, post 11 September we were advised not to raise the minimum wage because it would affect people on 1 October. We now have record employment levels again and another reduction in unemployment. Inflation, interest rates and other indicators are looking very good. Of course, no hyperbole is allowed in this Committee, but I think that the RDAs would say that they have at least contributed to that.

As Labour Members know, and as an hon. Member said at DTI questions this morning, when traditional industries died, new jobs were found. The RDAs have been good at bringing people together in situations such as that at Longbridge, which thankfully did not close. My hon. Friend the Member for Dudley, South (Mr. Pearson) was a member of the Longbridge taskforce. In answer to another questions, the RDAs were essential; without them, that taskforce may have been set up, but it would not have been so successful. The taskforce was the RDAs' idea, and it was led by someone who understood the automotive industry well. That was a great success.

The economy is sound and we are attracting record levels of inward investment. We have the best record in Europe and are second only to the United States in the world. The hon. Member for St. Ives mentioned competition. We have mechanisms in place to ensure that there is none of the competition for inward investment between regions that means that the investment does not come to England at all. The Welsh Development Agency was good at walking off with jobs for Wales before the RDAs were set up. That is one reason why they were set up; it was amateur hour in the English regions. We now have strong measures in place. We have Invest UK and the RDAs to ensure that there is no internal competition.

Mr. Waterson: I want to be clear on one issue. The Minister lauded our record on inward investment, which is extremely good and encouraging. Does he agree with his Secretary of State that inward investment in this country is threatened by the fact that we are not members of the euro?

Alan Johnson: Actually, I do agree with my Secretary of State, but I do not want to go too far down that route—

The Chairman: Order. I rule that the Minister does not have to answer that question.

Alan Johnson: But I want it recorded in Hansard that I agree with my Secretary of State. That is quite important to me.

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My hon. Friend the Member for Liverpool, Riverside made an important contribution. She has a track record on these issues and has been heavily involved with them. I did not know that she was on the Millan commission, but it showed in her thoughtful contribution on the issues. She mentioned regional venture capital funds, which are an important development. There are only two in existence, but soon every region will have such funds, which will be administered by the Small Business Service but set up by RDAs.

My hon. Friend mentioned broadband. As the hon. Member for Eastbourne knows, in the south-east no one can sit down with Allan Willett for two minutes without him mentioning broadband, which is a huge priority there. SEEDA has made broadband its priority, and it should perhaps be more of a priority elsewhere, too. My hon. Friend also mentioned spin-off from universities. Last year, such companies were three times the level of the year before. To a large extent, that was the responsibility of the RDAs for bringing the universities into their purview.

I am told by Lord Thomas of Macclesfield, to whom I pay tribute for his work, that even though aerospace forms a large part of the north-west economy, there was not a single university place to train people for the aerospace industry. That is changing because of a regional focus led by the RDAs. I agree with the points that my hon. Friend raised, and I think that they will be read with great interest by the RDAs when they receive transcripts of the debate.

The hon. Member for St. Ives made a thoughtful contribution. He was being a critical friend. Many of the points that he raised were about what is happening in the south-west and the scrutiny process. If we get the scrutiny process right, through whatever mechanism, it will help local people, local authorities and particularly Members of Parliament to have more faith in the system. I wonder whether the reasonable questions asked by the hon. Gentleman could not be asked of the RDA by him as an MP and his colleagues. They need answering.

The hon. Gentleman referred also to the targets that the RDAs set for themselves. The South West of England RDA set its own targets and, from the report, it seems that it fell short of them. Well, at least it had a stab at setting its own targets and circulating them. We are now setting the targets on those issues from a single pot—we are setting them centrally. We have discussed them; we will have the corporate plan, discuss it and reach agreement with the RDAs. It will be a more stringent method of examining the targets at the end of each financial year.

I shall not go so far as to say that I have enjoyed the debate—as if anyone enjoys two-and-a-half hours on a Thursday afternoon in a Committee Room—but it has been important. We need more such debates, because the RDAs will be an even more central feature of the economic success of the country in future years.

Question put and agreed to.


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    That the Committee has considered the matter of the progress of the Regional Development Agencies against their objectives.

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Committee rose at twenty-six minutes past Four o'clock.

The following Members attended the Committee:
O'Hara, Mr. Edward (Chairman)
Ellman, Mrs.
George, Andrew
Mann, John
Pearson, Mr.
Quinn, Lawrie
Steen, Mr.

The following also attended, pursuant to Standing Order No. 117(3):
Johnson, Alan (Minister for Employment and the Regions)
Stewart, Ian (Eccles)
Waterson, Mr. Nigel (Eastbourne)

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