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20 Feb 2008 : Column 80WH—continued

Let me say to the Minister something about that shift, that redrawing of the boundary for New Wortley. It is welcome and the councillors have worked with that neighbourhood to build up a community centre, and to
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try to get training there. But what do they find? The very budget that supports that community centre and that training to get people into work is now being taken away. That cannot be right. I will just draw on this one example, but there is little point in other Ministers telling us that people on council estates ought to be given training and put into jobs, and suggesting that training is provided in community centres in the neighbourhood, if the resources to do that are not there or are even being taken away.

Leeds, West had the West Leeds Family Learning Centre, which was built up when my hon. Friend the Member for Leeds, East was Leeds council leader, from the germ of an idea to help people in a neighbourhood of high unemployment and low skills and training. We have the lowest aspiration in the city, with many single parents, especially women, and many unemployed people. That training centre provided by the council used the new deal of the Labour Government well: 293 people a year were training there to gain skills, and people ended up going in the direction of university or running Sure Start projects as a result of that training.

But what happened? Only a year and a half ago, the Government decided to put the training centres out to tender. Unfortunately, the council did not win the tender; it was won by a company in Bradford, and the consequence was that the only training centre in my whole constituency was closed down. Yes, a centre has opened in another part of town, but people cannot get to it on the bus, and when I checked how many young men and women from Leeds, West are now being trained, I found that it was two a year, not 293.

There is no training facility in my neighbourhood. Where will the money come from to rebuild it? I agree with the Minister for Housing that we should put training back in the New Wortley and Fairfield community centres, where the people are. We should do what those centres were doing, line up local employers, and make them family-friendly so that people can take their kids to school and walk to work. We were doing all that work before, but it has been dismantled. We should put it back in those centres, but which programme do we look to? We look to the new working neighbourhoods fund. Why? It is more flexible than Jobcentre Plus and can deliver locally to local communities. It can work with local employers in the way that I described. But what has happened? We now have no access to it at all.

Leeds now has 63,000 people without skills and training, and the numbers are increasing. My constituency has moved up the table, and Leeds, Central, Leeds, East and Leeds, West have some of the highest figures in the country for people without skills and training. Of course we have done something on low pay, and of course we have more people in employment, but we are still miles behind on skills and training, and the working neighbourhoods fund is precisely what we need.

The irony of the situation is that the fund is called the working neighbourhoods fund. If we take away that money, there will not be more work, and people will be condemned to live on benefits. We will have more difficulties getting people off incapacity benefit and getting them into training schemes or suggesting further and higher education. As it is, we have an almighty struggle to get facilities in the neighbourhood that people can get to. The city is clogged up by transport problems, so people cannot cross the city to go to jobs
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elsewhere; they are physically locked out and cannot get down the dual carriageway from Stanningley or down Tong road into the city centre in the morning. Getting into work is not doable without a two-hour daily journey.

Providing work in the neighbourhood means providing training in the neighbourhood and working with local people, and that means providing the budget to back things up. This is a small budget in terms of the overall city budget. Although the settlement is tough, it is better than what we had under the Conservative Governments, and it is at least increasing. The piece of the jigsaw that we are talking about is vital to tackling poverty in the round. The key to tackling poverty is getting people into work and training and supporting them. Without that, we will go backwards, not further forwards.

In that context, I hope that the Minister will think again. It is a sick irony that we now have a new working neighbourhoods fund to replace the neighbourhood renewal fund. Yes, there is a good focus on work, and there needs to be a focus on work, but, sadly, the means to introduce change are not there. If such means are not put back, we will go backwards.

10.23 am

Justine Greening (Putney) (Con): I thank you, Mr. Gale, for giving me the chance to take part in the debate. I am not a Leeds MP, so I shall be brief because I do not want to eat into the time available to MPs from the area.

I recognise many of the issues that have been raised, because we face them in my part of London. We, too, have seen the withdrawal of the neighbourhood renewal fund and the deprived areas fund, and I recognise the absolute frustration felt by local MPs. They know that, with support, there are opportunities to achieve something for particularly deprived parts of their constituencies, but they will simply not get that support because there is no access to the necessary money.

I want to make two brief points. The first relates to the neighbourhood renewal fund and the deprived areas fund, which have now been combined into the working neighbourhood fund, with a collective fall in funding of £88 million. If it is believed that such funding works and that such investment achieves a positive return for the communities that it goes into, why is it being cut? How can that be a sensible decision?

My other point is that, although it is appropriate to start with the statistics for deprivation in areas where the Government want to target the money, they must surely look at the quality of the proposed investment projects and at what the money will be spent on. My frustration relates to the fact that investment can take two forms. We can have projects that are already up and running and which local people feel are valuable, as Leeds MPs have effectively articulated. However, regeneration opportunities could also be coming down the track, and careful Government support could make the most of them for local communities. There is a lack of thought on the supply side about what employment prospects there are and about the projects that are being supported by such money.

To conclude, local authorities seem to drop off a cliff and to get everything or nothing. That is not a sensible way of looking at how to apportion funds.

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10.25 am

Colin Burgon (Elmet) (Lab): Although my constituency is called Elmet, it lies entirely within the Leeds boundary. I pay tribute to my hon. Friend the Member for Leeds, East (Mr. Mudie) for raising the issue and particularly for arguing his case with passion and conviction. In that, he was echoed by my right hon. Friend the Member for Leeds, West (John Battle).

My right hon. Friend and my hon. Friend enjoy many advantages over me, including the fact that they used to be Leeds councillors. The only advantage that I enjoy over them is that I was born in Leeds and have lived my whole life there. I have watched with interest the development of the Leeds economy, and it is something about which I feel very committed. The trend in Leeds is summed up by the collapse of manufacturing industry. Up until about the 1970s, clothing, textiles, engineering and, in my constituency, mining offered good, well paid, secure jobs to the vast majority of people in Leeds. The collapse of manufacturing in the 1970s brought about a dramatic change in the city’s social structure and the beginnings of what has since become a fundamental generational issue. We now have neighbourhoods that have never seen permanent, good, relatively well paid employment, and that is a tough nut to crack.

On the other hand, there is the picture of Leeds as a booming city, which has a financial sector with banking, insurance and so on. However, huge areas of the city do not benefit from such developments, and although that does not include my constituency, I am still committed to tackling such issues as a Leeds person. In effect, we have developed an hourglass economy, and the market will not address that structural problem, which is why the role of local and national Government is so important.

I do not want to go on too long, because I am conscious of your decision to call the Front-Bench speakers shortly, Mr. Gale. However, the key factor arising out of the debate, as has been mentioned, is that 149,000 people in Leeds are designated as deprived. Some 63,000 workless people live within the Leeds boundary, giving the city the fourth-highest concentration of workless people in the country.

We have talked about lower super output areas, which is a real mouthful, and we have been told that Leeds misses out under that criterion by 0.04 per cent. I have a number of questions to which I hope that the Minister will apply himself, because, as my hon. Friend said, the Government’s decision means that Leeds and Leeds citizens will lose £42 million over the next three years.

I know the Minister to be a sensible, caring and intelligent individual and I ask him whether there is not a case for building a margin of error into the Government’s calculations, or for rounding figures up when they are so close to the 20 per cent. Could there not be a banding system? In this clash of the titans between the Minister and my hon. Friend, that might be the sensible middle ground, around which we can all gather, reach a deal and move things forward for Leeds.

What consultation did the Government undertake when they decided how the funding would be allocated? How did that compare with the consultations that took place on the allocation of the NRF funding? The key question, which has been raised by my comrades and by other Leeds Members, is why we are the only major city that does not get working neighbourhood funding.

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I want to finish by saying that we are not paranoid in Leeds. Often people in the rest of Yorkshire feel envious of us. It may well be that there is a certain quality about Leeds people that puts us ahead of others. The point is that we are arguing today for fair funding for Leeds people. The Minister should address that, and I hope he will.

Mr. Roger Gale (in the Chair): I thank all those hon. Members who have participated for adhering to my request for brevity. We should now have adequate time for the Minister to offer a full response to an important debate, as long as the Opposition Front-Bench Members exercise similar restraint.

10.30 am

Lembit Öpik (Montgomeryshire) (LD): I shall certainly accord with your exhortation to brevity, Mr. Gale.

At the heart of the debate, it seems, is a discussion of the fashion for formulae. I think that that is something that has eroded the quality of Government in recent times. The issue is over-reliance on those formulae, and under-reliance on the responsibility that every Government should embrace for decision making that takes an empathic view of the consequences that the formulae would impose. I love formulae. I am really a physicist at heart, and I have no doubt that mathematics and the formulae that it provides are very important for Government. However, we are dogged by bad formulae at the moment. The Barnett formula for allocating funds to Scotland, Wales and Northern Ireland is so bad that Joel Barnett, its progenitor, says that it should be abolished and changed. Objective 1 funding has displayed the same kind of catastrophic failure to think about the consequences of minuscule percentage changes in local circumstances. Indeed, my own constituency lost, by a tiny percentage, tens of millions of pounds, very much as Leeds seems to be suffering now.

The formula that is under discussion today may again be wonderfully precise mathematically, but it completely fails to consider the human consequences of that precision. The victims of that mathematical fluke are the people of Leeds. We heard from the hon. Member for Leeds, East (Mr. Mudie) that 95 areas qualify, but the bar is 96. As the hon. Member for Elmet (Colin Burgon) said, 0.04 per cent. is a rounding error that in any normal circumstances would be considered to be zero. Yet that small change will affect 63,000 workless people in Leeds, and 149,000 people who are considered to be in a deprived circumstance.

We have heard already that that will lead to the exacerbation of serious social problems, through the shutting down of many projects. My hon. Friend the Member for Leeds, North-West (Greg Mulholland) made it clear that a huge number of specific and well intentioned projects, which make a difference, will be lost for the sake of that rounding error. In a passionate and considered speech, the right hon. Member for Leeds, West (John Battle) again pointed out the ludicrous nature of the mathematical formula being used to make the cut. He suggested that by atomising the city into urban villages one could play the same game—and indeed one could. We might as well accept that if the mechanics of social policy are no more complex than a Rubik’s cube we should move the boxes around until we find exactly the
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out-turn that would mean falling within the terms of the imposed formula. That is how I see the difficulty before us.

The challenge for the Government is not mathematical; it is political. If we are really so sure that formulae work, we may as well do away with Ministers and leave the government of the country to accountants. However, I believe that that is not the Government’s intention, and I have to believe that the Minister will be able to assure us that he empathises, to the extent of being able to agree that what has happened is a ludicrously random, arbitrary and unfair way to determine the future of the inner-city elements of Leeds.

Let us consider again what the hon. Member for Elmet said: the decision can quite legitimately be considered as a rounding error. I wait to see why the Minister is so sure that the figures are so precise that he can know the figure of 0.04 per cent. is reliable within the bounds of variation. I joined the Liberal Democrats in 1990, when the papers said that our poll rating was 3 per cent., with a statistical variation of plus or minus 4 per cent., so I have been pretty sceptical about statistics ever since I joined a party that was in theory at minus 1 per cent. in the polls. I want the Minister to explain why he is so sure that the precision of the figures being used now is better than that of those polling calculations, or other calculations that are open to doubt.

I want to add my own questions for the Minister. First, does he feel that the Government are imposing a common-sense situation on Leeds with the loss of all the money? Secondly, does he recognise that the anger that has been described by Leeds Members of Parliament is not necessarily anger with the Government, but comes from a pride that those colleagues obviously feel, and frustration that the Government seem to be failing in their duty to exercise political judgment in simply depending on a mathematical formula? Thirdly, why does the Minister think that it is reasonable for finance to be switched off like a light, even though it is obvious that the deprivation is real and present, and pretty much at the same level that it was at when the millions were being handed out?

Lastly, is the Minister willing to reconsider the matter, perhaps by meeting with the Leeds Members? I would not need to attend that meeting, because I am speaking now on behalf of my party, against what I believe to be an injustice. At the very least, I hope that the Minister will say that on consideration he will have a non-confrontational meeting with the Members of Parliament for Leeds constituencies who want to make their points clear, and that it will be a worthwhile meeting—a genuine consultation, and not another opportunity to explain to the Members why the decision is “clearly right”. If the Minister does that, there is hope for progress, but let us recognise that the decision that has been made is based on a rounding error. If the Minister does not reconsider, the cost, beyond the loss of good will, hope and opportunity, will in all probability be economically greater than the saving that he thinks he will make.

10.37 am

Mr. Stewart Jackson (Peterborough) (Con): I congratulate the hon. Member for Leeds, East (Mr. Mudie) on securing the debate and on his sincerity and the heartfelt case that he made. He and his colleagues are a credit to
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the city that they represent. They are obviously concerned about the fact that the city will not continue to receive working neighbourhood funding.

Clearly, the work that has been undertaken in the past in the areas that have been mentioned, such as jobstart schemes, the work of neighbourhood wardens, and burglary reduction has made an impact on the quality of life of the hon. Gentleman’s constituents. Few would argue about whether that work was needed. I noted that his constituency has the 47th highest rate of unemployment in the United Kingdom, and that in Gipton and Harehills ward 47 per cent. of children were living in households on benefits and only 31 per cent. of pupils left school with five or more GCSEs in 2005. However, that is not an issue that affects only West Yorkshire. My hon. Friend the Member for Welwyn Hatfield (Grant Shapps) recently discovered, through a parliamentary question, that there are no fewer than 21 local authorities in the same situation as Leeds: that is, having received neighbourhood renewal funding previously, they will not now receive working neighbourhood funding. In fairness, not all of those will have transitional funding at the level that Leeds will.

Far be it from me to help the Minister, although I know that he had a late night last night—half-past 1, I think—but the hon. Member for Leeds, East could be accused of gilding the lily slightly by focusing on just one of the criteria, which was the 20 per cent. figure for lower super output areas. He will know that two other criteria are used in allocations. However, it might be, of course, that he was taking issue with the wider problem of the methodology used by the Office for National Statistics. We could be here all day discussing that matter, on which I think that there is consensus, as was mentioned by, among others, the hon. Member for Leeds, North-West (Greg Mulholland) and my hon. Friend the Member for Putney (Justine Greening).

In fairness, as was explained in a parliamentary answer last year, between 2001 and 2007, Leeds, East received £1.95 million of discrete funding via Yorkshire Forward, and that does not include the single regeneration budget sums allocated to Leeds, East. That said, Leeds residents are entitled to feel aggrieved by the Government’s high-handed attitude. The revenue support grant increase of 2.8 per cent. this year threatens a serious cash shortfall, according to the city council’s deputy leader, Councillor Richard Brett. Inevitably, that will mean service reductions and above inflation rate council tax rises. In addition to the loss of neighbourhood renewal funding, the local authority business growth incentive scheme has also been axed, removing £10 million of funding from council coffers.

Yesterday, we read in the Yorkshire Evening Posthow the hon. Member for Leeds, East felt moved to comment on the duplicity of the Department for Transport in recommending only small-scale transport infrastructure for Leeds while putting forward a massively costly project in Manchester, which even the hon. Member for Manchester, Blackley (Graham Stringer) called a “hugely expensive white elephant”. No wonder the hon. Member for Leeds, East felt moved to say:

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