The impact of the current economic and financial situation on businesses in the West Midlands Region - West Midlands Regional Committee Contents

1  Introduction

Background to the Committee

1. The West Midlands Regional Committee is one of the eight Regional Committees established in November 2008 on the recommendation of the Modernisation Committee.[1] It has the remit to "examine regional strategies and the work of regional bodies".[2] The Modernisation Committee argued that "there is clear evidence of an accountability gap at regional level", and that although RDAs and other bodies were accountable to Ministers, "many of their activities in the regions are not subject to regular, robust scrutiny".[3]

2. Members were appointed to the Committees on 3 March 2009.[4] Only Labour members were appointed, as other political parties declined to take up their places. Clearly it would be much more satisfactory if Members from other parties were also participating. However, we have followed the practice of other select committees and conducted our work in as non-partisan manner as possible, as our principal concern has been to find ways of improving circumstances for people and business in the West Midlands region.

3. We have also been keen to ensure that the Committee is for the whole region, not just for a particular area or areas. It has been a point of principle, therefore, that we have looked at issues that affect the central West Midlands conurbation, urban areas in the north of the region and Warwickshire, market towns and rural areas. We have decided that when we hold our evidence gathering meetings that they should take place around the region, and by the time we complete the work we have planned for our first year we hope to have held meetings in every broad geographical area. The only exception to this approach is when we take evidence from ministers and official bodies, when the meetings will generally be in Westminster.

Our first inquiry

4. When we first met in March, it was clear what our first inquiry would be, namely the effect of the economic downturn on businesses in the region. Our terms of reference are:

• The effect of the financial and economic situation on businesses in the region including the effect on different sectors such as manufacturing, service industries etc
• How effective Advantage West Midlands and initiatives such as Business Link are being in assisting businesses in the current climate, including helping them to gain access to funding both from Government funding streams and through the banking system
• The response of banks and other financial institutions to government and other initiatives to stimulate bank lending and the access of businesses in the region to credit
• The role of the West Midlands Task Force established by the Regional Minister in helping businesses cope with the economic downturn.
• The role of other Government agencies such as the Government Office for the West Midlands, and of partnerships between Government agencies, local government and the private sector, in providing support for businesses.

5. We received 33 written submissions from organisations around the region. We were extremely pleased with this response, and are grateful to all of those who wrote to us. We took oral evidence from Barclays Bank, HSBC, Lloyds TSB, RBS, West Midlands Federation of Small Businesses, West Midlands Business Council, Chamber of Commerce Hereford & Worcester, West Midlands Developers' Alliance, British Ceramic Confederation, Ideal Standard, Jesse Shirley, UNITE, Local Government Association, Stoke-on-Trent City Council, Staffordshire County Council, North Staffordshire Regeneration Partnership, Advantage West Midlands, Government Office for the West Midlands, Department for Business, Innovation and Skills and Ian Austin MP, West Midlands Regional Minister. Once again, we are grateful to all of those who gave their time to discuss the current situation facing businesses in the West Midlands. We also thank Professor David Bailey, formerly of the Birmingham Business School and now of Coventry University, for his assistance to the Committee during the inquiry.

Next inquiries

6. We have decided that we will hold two further inquiries in late 2009-early 2010. For the first of these, on The effects of the economic downturn on the people of the West Midlands, which is designed to complement our current inquiry, we have already issued a call for evidence, and we intend to take oral evidence in early autumn. The second future inquiry will look at matters arising from the Regional Spatial Strategy (RSS), in the light of the outcome of the Examination in public of the phase 2 revisions of the RSS (relating to the provision of housing and employment land, town and city centres, transport and waste) and the decision on preferred options following consultation on the phase 3 revisions.

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1   The establishment of a ninth committee, for London, was agreed by the House on 25 June 2009. Back

2   Standing Order No. 152F. Back

3   Select Committee on Modernisation of the House of Commons, Regional Accountability, Third Report, Session 2007-08, HC 282, 2 July 2008, Summary. Back

4   Votes and Proceedings, 3 March 2009, pp 258-9.  Back

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Prepared 23 July 2009