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Jon Cruddas (Dagenham) (Lab): There has been a lot of cross-party agreement tonight, so I hope that I will not add a note of disagreement at the end of the debate. I want to raise a few issues about local buy-in to the whole regeneration process across the Thames gateway, and I hope that that will be taken in the spirit intended. Before that, I should say that I welcome the debate, which has allowed us to take stock of where the Thames gateway discussions have got to. It has been a good debate.

My points relate specifically to my constituency and the sheer rate of change in the debate over the past few years. I entered into this discussion before I was elected to Parliament, when I worked in Downing street, because of economic transformations in the UK car industry. After BMW pulled the plug out of Rover in the west midlands, the next one on the runway would have been the Ford Dagenham plant. We got involved to manage the process of economic transformation and change, and that quickly got me involved in a series of economic and social relationships above and beyond the Ford Dagenham estate, to do with the work of the Thames Gateway London partnership and what was happening in terms of the single regeneration budget project at the heart of the Thames gateway.

What we decided during those difficult transformations in 1999–2000 is beginning to come on stream now. For example, in collaboration with the Mayor's office, the London Development Agency and the Department of Trade and Industry, we agreed to set up the Centre for Engineering and Manufacturing Excellence, which was opened last year by the Prime Minister on the Ford estate in my constituency. That is altering the life chances of local people in enabling them to take qualifications up to the most advanced postgraduate level in engineering and manufacturing, and that is much to be welcomed.

At the same time, we agreed a package to build a new Ford engine plant on the Dagenham estate, which the Prime Minister also opened last year. We are in discussions to increase capacity at the plant over the coming period to ensure that we have an enduring legacy of diesel technology and engine manufacture in Dagenham.

What was the SRB project around the heart of the Thames gateway has been transferred or consolidated into the London Riverside regeneration company. I should declare an interest as an LDA nominee on the board of that company and as an LDA nominee as a director on the CEME project.

All that is to be welcomed, and those are secure building blocks, which were developed during 1999–2000. Since then, there has been a massive intensification of the debate and policy developments around it. We have to ask why that has occurred. Obviously, we have had the Mayor of London's spatial economic development plan as well as strategies by which he can manage economic change and population movements in London by pushing the centre of gravity of policy making eastwards. That has come alongside the strategies of local boroughs, which have been in development for a number of years, to try to confront local issues of poverty and deprivation. At the same time, we have had the Government's national prioritisation of the Thames gateway, arising partly
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because the housing crisis in the south-east acts as a brake on broader patterns of economic change across other regions of the British economy. We have to put the brakes on interest rates because of that, meaning that growth is constrained elsewhere in the economy, irrespective of economic context in different regions. Secondly, as we saw in the review of our prospective entry into the euro, the housing market in the south-east constrains entry because of the possible effect that a reduced pan-European interest level would have in reigniting growth in the south-east. That would in turn have an effect on other regions in the UK.

Therefore, we have come a long way since I first got involved in 1999–2000 and the Government should be commended for the rigour with which they have approached the issue, the thinking behind some of the policy prescriptions and for turning it into a national priority, with its own Cabinet sub-committee. However, the various objectives of different levels of government with regard to the Thames gateway throw up different priorities and create tensions in the debate. The first concern is the structures and institutions involved. The number of institutions working in parallel on aspects of regeneration has already been pointed out—for example, the LDA, the boroughs, local regeneration partnerships, English Partnerships and the new London Thames Gateway Development Corporation. That all shows the commitment to regeneration, but we need a clear delineation of responsibilities, otherwise, we could create confusion, hesitation and fragmentation.

We should not concentrate all developments and priorities within certain sectors of the Thames gateway. That concern is felt in the London riverside area, in terms of the Olympic bid and the possible reprioritisation of projects towards the eastern area, at the expense of developments to the west within the urban development corporation boundaries. Transport infrastructure is also critical. I flag up the issue of the Thames gateway bridge, but I welcome the commitments that the Government have made, which my hon. Friend the Member for Bexleyheath and Crayford (Mr. Beard) mentioned.

All these aspects of the issue are welcome, but there is a brittleness about some of the decision making. My real concern is local community buy-in to the overall gateway strategy. As I said earlier, Dagenham sits at the geographical centre of the Thames gateway. It covers much of the London riverside part of the gateway and has a massive amount of brownfield land. Across the London riverside area, excluding Barking town centre, we anticipate some 20,000 new homes over the next 10 to 15 years. It is also one of the smallest boroughs in London and has a great strategic location.

Notwithstanding the future developments, change is already occurring at an astonishing rate. It is estimated that the population has increased by some 20,000 since 2001. That is partly because we have the lowest-cost housing market in Greater London. As house prices have risen, aspiring members of the property-owning democracy have gravitated towards the area, so that we have increased demand for housing in the borough. At the same time, the effect of the right-to-buy policy has meant a greater supply of private housing stock than previously. People are also ahead of the curve in terms of the Government's strategy for east London and are
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gravitating towards the Thames gateway because they foresee the future economic developments in the area.

Cumulatively, those elements are transforming the local community day by day. However, that is occurring even before we trigger the changes anticipated under the gateway proposals. That transformation is colliding with the long-term legacy of poverty, deprivation and underinvestment in public services in the locality. That is the crux of the issue of regeneration in Dagenham. A fundamental tension exists between our historic economic and social legacy, current changes that are transforming our community and the radical changes that are envisaged in the future. On top of all that, we have the toxic politics of race, operating within the context of limited resources, great need and rapid change, both now and in the future.

Consider, for example, some of the basic characteristics of the community. It is the lowest-wage economy in Greater London. Adult numeracy is the lowest in the country and adult literacy the fourth lowest, and the number of people with higher education qualifications is the lowest in the country. Heart and lung disease, infant mortality and life expectancy are among the worst in the capital.

Yes, we are seeing incremental change: some of the schools are the fastest improving not only in the capital but in the country, and new integrated health centres are being built across the borough. The new hospital at Oldchurch will, I hope, open in the next 18 months. That is all incrementally positive change—but it operates in the context of population expansion that places even greater tension and pressure on local public services.

Take, for example, health funding. We have an acknowledged serious under-capitation. Despite a recent generous settlement, we will be 10.7 per cent. under capitation in three years' time—one of only four primary care trusts nationally to be in that situation. That amounts to a year-on-year shortfall of £24 million a year in PCT funding, with no defined commitment to sorting it out.

That is before we even begin to consider the additional pressures arising from our own current population growth, let alone future population growth. Even on the basis of out-of-date population statistics, the discretionary Thames gateway funding for health is small beer in the context of that structural health funding problem. For example, this year we received some £700,000 to deal with the population changes, which is not a lot, given the £24 million annual shortfall.

My point is simple: we do not have enough resources to deal with our historic problems, let alone current and future changes. How does that manifest itself? Change is always difficult for people, and it is more difficult when resources are severely limited. For people to feel comfortable, they have to have confidence in change, and feel that it will benefit them and their families. At the moment there are not enough secure footings on the ground in terms of public service delivery for people to feel confident in the broader patterns of economic transformation.

Housing is another example. There are about 6,000 people on our waiting list in the borough. Historically, here more than almost anywhere else in the country, the
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local community has relied on the principle of council housing to deliver socialised housing provision. Yet last year, because of changes in the make-up of local authority social housing grant, the authority lost about £12 million on a couple of key sites, and had to establish its own partnerships with a developer so that it could maintain control of nominations to the social housing dwellings.

That has engendered real concerns about the ability to provide local homes for local people in the context of both current changes in the community and future housing developments with limited nominations for local people. Again, the lack of a base camp of confidence to deal with current problems undermines the confidence in future changes. The local population therefore feel threatened and concerned, and that rich brew of legacy versus current changes within the community, let alone future changes, manifests itself today in far-right activity. Two months ago, the British National party secured its first council seat for 11 years in the capital, in the constituency next to mine, and in the same borough. That development did not fall out of the sky; it is a manifestation of the tensions over resources in the context of changing communities and long-term historic need.

I have raised those points to illustrate some of the possible tensions surrounding future regeneration in the Thames gateway. In our community, the stakes are high. The jury is out on local buy-in to the whole gateway agenda. We must do more to build confidence in the community, and that must be translated into resources. Regeneration must be built on fairness that takes local people with the process of change. If it is not, the phrase "sustainable communities" will seem as a complete and utter misnomer.

I am confident about the agenda for change, but I do not underestimate some of the difficulties attached to it. For my community, the whole question of the Thames gateway can go in one of two ways. It could continue the previously repeated process by which people feel threatened and hostile because something is being done to them rather than with them, with the corresponding angry resentment that can be articulated in extreme forms. Alternatively, it could be a rewarding and liberating process of material, economic and social change that takes people with it and genuinely builds new sustainable communities. I am extremely confident that the Thames gateway agenda will take the latter route rather than the former, but I do not underestimate the difficulties attached to the process of change.

9.34 pm

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