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Regional Development Grants

Volume 113: debated on Wednesday 25 March 1987

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asked the Secretary of State for Trade and Industry what has been spent on regional development grants in England so far in 1986–87; what he expects to spend in 1987–88; and if he will provide figures for the north-west.

Provisional figures for payments of regional development grants in 1986–87 to the end of February are £226·8 million in England and £91·3 million in the north-west region. The 1987–88 provision for regional development granta for England, as incorporated' in the Supply Estimates, is £105 million. Future provision for expenditure on regional development grants is not allocated at the regional level. The actual distribution will depend on the pattern of demand.

I acknowledge those figures — one is always grateful for small mercies under this Government—but is the Minister aware that the north-west region still has the second highest number of unemployed in Britain outside the south-east and London, and that far more money is necessary to get greater financial investment moving in that area and to create safer and more secure jobs? Is he further aware that the 1981–84, census taken by the Department of Employment reveals that 158,000 jobs were lost during that period in the northwest region? Is that not the result of the Government's complete neglect of a once great industrial region and the fact that they continue with their senseless and futile economic policies?

The hon. Gentleman will, on reflection, realise that the massive contribution of inflation to the health of the north-western economy is something for which he and other supporters of the Labour Government should take at least some responsibility. The north-west region will be a beneficiary of the improved economic climate and the £230 million of selective assistance that is being distributed, of which the north-west has £67 million, to create 17,000 jobs in recent years, is at least a start in the right direction.

Does my hon. Friend agree that large parts of the south-east are over-priced, over-congested, overrated and thoroughly disagreeable, and that that will become far worse in the next 20 years or so? Should not northern Members of Parliament be emphasising the positive advantages of their area, which is ideally built for future business expansion, with its marvellous infrastructure, marvellously cheap places to build businesses and homes, good schools, roads, and commercial infrastructure? If business men came to our region, particularly to the metropolitan borough of Bury, regardless of regional aid grants, they would find a wonderful place for their businesses for the future.

Notwithstanding the reply that the Minister has just given, does he not recognise that in the north-west there are large areas of dereliction, factories which have closed and many people out of work, and that the Government's hands-off approach has only been compounded by the giveaway Budget, which did nothing to provide additional resources for less prosperous regions? Will not the absence of a regional policy to provide new work, new hope and new prosperity, simply suck away yet more of our people and resources to the south-east?

I am astonished at the rashness of the hon. Gentleman, coming as he does from an area of Merseyside where more public money has been spent over more years than in any other part of the United Kingdom. Has he forgotten the creation of the urban development corporation, the enormous effort made to reclaim large parts of Liverpool's city centre and the substantial number of jobs created in many urban developments within the Liverpool area to try to deal with the problem of neglect?

Will my hon. Friend accept from me, representing a north-west constituency as I do, that the Budget was warmly welcomed by industry from every sector? Will he also accept that, far from the whingeing that we have heard from the Opposition, if we had responsible councils seeking to reduce rather than increase rates to and planning departments that were prepared to be flexible in accordance with the Government's requirement, the opportunities for industry, which in my area are immense, could be repeated throughout the north-west region?

My hon. Friend is right and I am sure that he, like others who live in that part of the north-west, will welcome the creation of the urban development corporation in Trafford Park, which I am sure will have a major influence on the centre of Manchester.

Can the Minister confirm from his figures that the cuts in regional development grant in England will be £121 million in the coming year, and that, on top of cuts in Scotland of £70 million and in Wales of £40 million, that makes a total cut in regional development grant of £230 million, the biggest single percentage cut in any one year since regional policy was established, and at a time of growing and deepening regional divisions? Given the catastrophic fall in manufacturing investment value, manufacturing employment and in manufacturing output since 1979, what possible sense does £230 million worth of cuts make? How many jobs will be lost as a result?

The hon. Gentleman should know perfectly well that the national expenditure on regional assistance is now £419 million, which represents a £36 million, or 9 per cent., increase on the previous year. The hon. Gentleman should also know perfectly well that there has been a change in the pattern of assisted areas, which has now includes 70 per cent., or thereabouts, of all those in the working population. That is the benefit of redrawing the map to ensure that all assistance reaches the parts that need it most. As the hon. Gentleman wants to discuss manufacturing investment I trust that he will take heart from the fact that, although manufacturing investment in the north has indeed declined substantially, and in the north-west it declined between 1979 and 1984 by 31 per cent., there has now been a substantial growth in manufacturing investment in the north-west. In the northern region as a whole there has been a growth of 26 per cent. in one year, and in the north-west that growth has been 10 per cent. in one year.