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Kevin Foster (Torbay) (Con): My right hon. Friend is right to outline our issues with infrastructure. One of the most visible problems with our infrastructure was identified last year in the constituency of my hon. Friend the Member for Newton Abbot (Anne Marie Morris) when we literally had the hanging rails at Dawlish. Does my right hon. Friend agree that a key part of the investment plan is securing a more resilient and modern railway for those communities such as Torbay, which are west of Exeter St David’s?
Dr Fox: It is understanding distance and the need to be able to connect the most far flung parts of the region. It is also understanding that people who live in rural areas require a different type of transport infrastructure to that which occurs in the cities. In funding decisions, we must take account of issues of rurality. Not everyone in Britain lives in Islington. We have to understand that there are different needs, and to meet them different solutions will have to be applied by central Government in conjunction with local government.
Rebecca Pow (Taunton Deane) (Con): We have talked about the powerhouse of the south-west, but I see Taunton Deane as the gateway to the south-west. We need much investment in our transport network, but in particular junction 25 on the M5 needs investment in new roads and an upgrade. On that hinges the development of a new business park that will bring high-tech jobs to the area. Does my right hon. Friend agree that we need to put that into our plan as well?
Dr Fox: The M5 is key, and we need to ensure proper investment in it all the way down, including at junction 19 where we have experienced problems, and at junction 21, where there will be new development. It would be very nice to have a motorway running all the way down the peninsula, to ensure a proper route down the spine for road traffic. We can give the Chancellor some very good candidates for the road investment that he announced today. I say to my hon. Friend, however, that one would not want to introduce a note of discord among the group by arguing about exactly where lies the point of entry to the powerhouse. It will be a multi-nodal powerhouse, and I am sure that there will be plenty of entry points to be mentioned in everyone’s press release.
Michelle Donelan (Chippenham) (Con) rose—
Dr Fox: I give way to my hon. Friend because I know that she has taken a particular interest in different parts of the railway infrastructure.
Michelle Donelan: Does my right hon. Friend agree that our transport links are vital to advancing the south-west’s economic growth, and that new stations, such as Corsham in my constituency, will be a huge boost for the economic growth of not only Chippenham but the entire region?
Dr Fox:
If we are to have railway infrastructure, it is very important that we have access to the railways, and the new station at Corsham is very important in that, as is wider access to the rail network for disabled people. When we are talking about developing a transport infrastructure, we have to remember that we must be able to give access to all the citizens in the region, not just those who are able-bodied. In my constituency we had to wait a very long time to get disabled access to
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one of our busiest stations. In this day and age, that is simply not good enough, so the sort of infrastructure that my hon. Friend mentions is vital.
The other common factor affecting all of us throughout the south-west, to one degree or another, is the health of tourism. That industry takes many different forms across the south-west but is important to the income of those who live and work there.
James Heappey (Wells) (Con): Of course it is not just the rich heritage, the stunning countryside and our rugged coastlines that bring people to our region; it is the fantastic food and drink produced by our farmers and food manufacturers. I am sure that my right hon. Friend will want to join me in emphasising to those on the Treasury Bench the importance of supporting our farmers and our food and drink manufacturers, not only as a driver for tourism in our region, but as something that we export with pride across the United Kingdom and around the world.
Dr Fox: Indeed, the maintenance of our countryside and the protection of agriculture is not only important in itself in terms of generating wealth and jobs; it is important in maintaining the visual environment that is intrinsic to the tourism industry. I am sure that all my colleagues will want to thank my hon. Friend for his dedication to the food and drink industry and his single-handed generation of wealth in the region.
Apart from the countryside, our region has cities with many historical attractions that we need to maintain.
Ben Howlett (Bath) (Con) rose—
Dr Fox: I give way to my hon. Friend, who is one of the best examples, not of ancient relics but of modern thinking.
Ben Howlett: I quite agree. As my right hon. Friend will know, one of the key reasons tourists do not return to Bath as a key destination in the south-west is our clogged up transport network and infrastructure. Does he agree that investment in roads and infrastructure in Bath will enable our tourism economy, which is so crucial to our city, to expand?
Dr Fox: The only city to compare with Bath in terms of difficulty of getting around, certainly as a driver, is Edinburgh. Anyone who can find a parking space in Bath is doing extremely well. These might seem like minor irritations, but they are major restrictions on a city’s ability to draw in wealth and tourists with spending power. The ability to do that is an important part of the wider economic picture.
I want to give my hon. Friend the Minister plenty of time to deal with all these issues, but may I finally raise the issue of fairer funding? It is a very sore point, not only in the south-west but in many rural areas across the United Kingdom. We have been told for such a long time that we are going to get a better formula that will reduce the discrepancy in per capita funding for those who live in the cities and those who live in the countryside. The countryside is not just where people from the cities go for their holidays or their weekends away, and the concept of rural poverty needs to be taken fully into account. There is no point in saying that the cost of
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living is lower in rural areas than in cities. We get lower funding per capita for healthcare, education and local government; we pay our taxes, yet our average wages are lower. We are being discriminated against in more than one way. The Government should equalise the formula much sooner than we have been led to expect. That is one of the key elements of being able to bring prosperity to our region.
Mr Christopher Chope (Christchurch) (Con): Following that point, would my right hon. Friend give time to developing a Fox formula, to ensure that we can link public expenditure in the south-west to the money that Scotland receives?
Dr Fox: I would settle for our fair share of funding in England. I have no intention of allowing my name to be used in a pejorative term, in the way that the Barnett formula has come to be regarded. I shall skip that opportunity.
Scott Mann (North Cornwall) (Con): Is my right hon. Friend aware that the cost of delivering services in rural areas is much higher than in urban areas, and in pupil funding there is a huge disparity, with many rural schools getting significantly less than urban schools—half as much in some instances? That is not good enough for our rural schools.
Dr Fox: In my view, it is a simple question of discrimination. Why should a child who happens to be born in a rural part of our country get less money for their education than a child who happens to be born, not necessarily a large distance away, but in an urban environment? We are not asking for more than we deserve. We are asking for our fair share of funding for the children in our constituencies.
Alex Chalk (Cheltenham) (Con): Of course, it is not just about rural areas. Does my right hon. Friend agree that the time has come to end the historic funding injustice to schoolchildren in Cheltenham, an urban area; and that we need to give schools in effective local authorities, such as Gloucestershire, the fair enhanced funding that is no less than they deserve?
Dr Fox: That is exactly the point. One of the things we will be pressing the Government on in the next five years will be ensuring that we get our fair share. We want to make sure that we can reach our full potential economically, and no area in this country can reach its potential economically unless the next generation is given the appropriate education and the tools to advance in a meritocratic, open, pluralistic society.
Dr Sarah Wollaston (Totnes) (Con): Does my right hon. Friend agree that when it comes to local authority and health funding, there is not only the higher cost of delivery in rural areas, but the fact that we have a higher age demographic in Devon and much greater need, which is not reflected in the current formula?
Dr Fox:
My hon. Friend, typically, makes an excellent point. We are a part of the country that is a very attractive place for people to go to when they retire, but that brings its own financial problems for funding our local facilities. My hon. Friend is all too aware of the
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fact that as we get a more elderly population, that brings with it more complex medical needs. It is the complexity of the medical needs that adds to the cost, as well as the number of individuals involved, and that will continue to rise, so we must have a proper match between the funding and the demand if we are to be able to cope with the pressures that are coming.
Michael Tomlinson (Mid Dorset and North Poole) (Con): Does my right hon. Friend agree that, as others have mentioned, in Dorset the education funding formula must be fixed, as well as the funding for our police forces and local authorities?
Dr Fox: I hate difficult questions in the Commons. I entirely agree with my hon. Friend, who makes the point very well. It applies to police authorities, education authorities, health authorities and local government. This region has not spoken with a single voice sufficiently in recent times. Tonight we are seeing the beginning of that.
Richard Drax (South Dorset) (Con): In the Chancellor’s excellent speech today, he hinted at enterprise zones for smaller towns. Does my right hon. Friend agree that the towns that we all represent are perfect locations for such zones to create wealth and jobs?
Dr Fox: My hon. Friend makes a very good point. If the Chancellor is looking for places where it would be appropriate for him to invest the money he has and where he would get a good bang for his buck, I am sure those of us here tonight could give him one or two pointers.
Dr Andrew Murrison (South West Wiltshire) (Con): My right hon. Friend has been extremely generous in giving way. As I sense that he is winding up, I wanted to ask him another difficult question. Has he spotted in the Budget resolution statement that £1.5 billion will be going to intelligence and security services? Does he welcome that, particularly as we in the south-west have a large number of constituents who are engaged in that vital enterprise?
Dr Fox: I am extremely grateful to my hon. Friend for making that point. That concentrates our minds in the south-west, but it should concentrate the minds of the whole country because the threats that we face as a nation are increasing. It is therefore vital that we increase the funds available to the intelligence services, but probably and more controversially we will have to give them the powers they require to be able to deal with the threats that we face. That will be a very different argument that we will have in the House in time to come.
At the recent general election a blue tide swept through the south-west, and now every constituency between Bristol and Land’s End, with the exception of Exeter—next time—is in Conservative hands. We understand the responsibility and the duties placed upon us by what was a landslide in that election, but we are thrilled at the opportunity it brings to speak as one to our own Government about the issues facing the south-west, and we have seen that unity of purpose tonight. There may be 56 Scottish National party MPs speaking for Scotland, but there are now 51 Conservative MPs speaking for the south-west. If we are the south-west powerhouse, perhaps we are also politically the new Scotland.
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We will be constructive and supportive, giving the Government the time and the space to deliver on their promises, but we will not hesitate to hold Ministers to account when those promises do not materialise. This is a once-in-a-generation opportunity and we are collectively determined to take full advantage of it.
7.19 pm
The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Marcus Jones): I congratulate my right hon. Friend the Member for North Somerset (Dr Fox) on securing this important debate. I welcome the interest from hon. Friends across the south-west. There is a slight show of strength from the region here tonight—probably the only constituency not represented is Exeter. I very much feel that I have been on a tour of the south-west. I am sure that colleagues in the Department for Transport and the Treasury—the Chancellor’s Parliamentary Private Secretary is here—will read Hansard intently to see what my right hon. Friend and other colleagues have said. I will try to answer as many of his points as possible in the short time remaining.
The Government’s economic ambition is to create a fairer and more balanced economy by supporting policies that grow the economy and generate new jobs and higher wages for everybody. In our election manifesto, we said that by attracting growth and new businesses we will improve connections to the south-west, with major investment in the road network and electrification of the Great Western main line, bringing new fast trains on to the route. We will increase the number of overseas visits to the south-west each year by investing in tourism. We will ensure that the world-class defence assets and cyber-security industries of the south-west benefit the local economy. We will focus on job creation by supporting business and investing in skills.
Employment in the south-west is up by 163,000 since the 2010 election; unemployment is down by 42% over the same period; and some 99,000 new businesses have been started in the south-west during that time. As my right hon. Friend has said, the Chancellor set out an ambitious six-point plan for the south-west earlier this year. It includes £7.2 billion of investment in the transport connections of the south-west, over £4 billion of investment in the electrification of the Great Western main line and a £10 million package of support for coastal towns across the south-west.
The south-west has an average annual growth rate of 4.17%, which is below the UK average of 4.23%. It is a small difference, but over time it leads to a significant difference in prosperity. It is driven by a gap in productivity; although the south-west accounts for 8.4% of the UK’s population, it accounts for only 7.5% of total output, as my right hon. Friend pointed out. It is that productivity gap that the Government want to address.
Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con): We are about start the largest infrastructure project in Europe: Hinkley Point C. The Minister and the Government have been very helpful in that. One of the most important things we have realised is that “learning and skills” is not synonymous with Somerset, Devon, Cornwall, Wiltshire or anywhere else in the south-west. Surely, we should be spending more in further and tertiary education and in universities in the south-west to encourage people to stay and work in some of our excellent industries. Does he agree?
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Mr Jones: I thank my hon. Friend for his comments. I am aware that growth deals have been put in place in his area to do just that, which is excellent news.
The employment rate in the south-west is above the national average, with over 35,000 more people in work in the past year alone. If we succeed in maintaining that momentum and in raising the long-term growth rate to the UK average, we could add £6.5 billion in real terms to the economy of the south-west by 2030.
The Government have agreed 39 growth deals across England, in which £7 billion will be invested in a wide range of local projects. The money will go towards providing support for local businesses to train young people, create thousands of new jobs, build thousands of new homes and start hundreds of infrastructure projects. Some of the major projects in the south-west that will be built as a result of these deals include £23 million for a new road tunnel linking Swindon to nearby Wichelstowe, creating thousands of jobs and opening up a new site for thousands of homes; £4 million to create the UK’s first robotics institute at Bristol; and £12.9 million to unlock housing and employment sites at junction 25 on the M5 at Taunton, which my hon. Friend the Member for Taunton Deane (Rebecca Pow) referred to.
I was pleased to hear in the Chancellor’s Budget earlier the comment that we were making good progress towards a devolution deal in Cornwall, which is an important part of the south-west and of the south-west’s potential.
Let me pick up on a couple of the points made by my right hon. Friend the Member for North Somerset. I note what he says about education, which is extremely important. I can empathise with what he says, as in the county of Warwickshire we often suffer from the same funding inequality. I am sure that he, along with other colleagues, will be pleased that in the last Parliament the Government made strides to move that inequality in the right direction and to close the gap. He will know that our party made a manifesto pledge to continue that funding across this Parliament. I am sure that the Department for Education will have heard his comments and those of several other hon. Members loud and clear.
I hear what my right hon. Friend says on local government funding and rural sparsity. Over the next few months, we will be working on the funding allocations for local government. No doubt, during that process, I will receive many representations from this part of the country if tonight is anything to go by. The Government have also provided additional funding this year for rural areas to take the sparsity issue into account.
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Another of my hon. Friends mentioned local councils’ ability to benefit from business rate retention, the new homes bonus and additional council tax. I am sure that the growth deals that have been put in place across the south-west will be beneficial as regards those additional funding streams. I hear what my right hon. Friend the Member for North Somerset said about council structures. Obviously, we are working towards a devolution deal in Cornwall, but I can reassure him that with council structures, devolution deals or combined authorities there is no Government prescription for how local people should organise their affairs. This is purely a bottom-up process in which local areas can come together and tell the Government what they would like to see. I hope that that gives him some assurance that we will not make any councils go into shotgun marriages, shotgun divorces or any arrangements that local people are not pressing for.
I probably do not have time to go through every comment made by my right hon. and hon. Friends. One big point that came out loud and clear was that the south-west sees infrastructure projects as hugely important in improving the tourism industry, industry in general and the lot for the agricultural sector, which is extremely important in many parts of the south-west. A Transport Minister from the south-west was on the Treasury Bench during the debate, and the Department for Transport will listen carefully to what my right hon. and hon. Friends have said about ensuring that we try, within the difficult circumstances we face, to do whatever we can to support the economy in the south-west.
The Chancellor will probably also consider many of the suggestions for roads, dual carriageways, junctions and so on as bids during the spending review, the next autumn statement and the next Budget. I encourage colleagues to speak to the Chancellor’s Parliamentary Private Secretary, as the demands and requests are slightly above my pay grade.
This has been a fantastic debate. The south-west is an extremely important part of our country. The Government are committed to supporting it, and I thank my right hon. Friend the Member for North Somerset and so many of our colleagues for raising issues from the south-west, so that the Government could listen tonight.