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Regional Government (North)

Volume 557: debated on Wednesday 30 January 2013

I am delighted to have secured the debate and to introduce it under your chairmanship, Mr Amess.

Regional government is an issue that is resonating with people from across the north. The campaign for strong, powerful and effective government for Yorkshire, the north-east and the north-west has been growing and gathering momentum in the past year. Its time has arrived. The arguments are strong and the case powerful. In the past 12 months, the debate has been led and championed by the Hannah Mitchell Foundation. It has outlined the benefits that regional government can bring to the northern area, how it can generate economic growth and social cohesion and how it can enable key decisions to be made in the north, by the north.

Regional government is supported not just by individuals but by business, local authorities and key agencies. It is time to move the debate forward. The arguments now need to be understood and taken up by central Government. Whitehall should not be fearful of devolving powers to the north; it should be embracing that. Without its support, the required political progress will not be made, or a watered-down version—a talking shop—might be applied. That is the last thing our region wants or needs. Indeed, I heard the Chancellor of the Exchequer over the weekend outlining how too much economic power was concentrated in London and saying that it was time to generate growth in the north. Will the Minister outline today some of the ways in which that can happen and say whether he would like to see a form of regional government helping to achieve the necessary economic growth and other benefits for the northern region?

I congratulate the hon. Lady on securing the debate, but does she not agree with me on the following? This matter was decided in the north-east in July 2004, when an overwhelming majority of 77.9% rejected a regional assembly.

The previous Government then decided not to proceed in the north-west, either. Given that, surely this matter has been settled, or is the hon. Lady saying that matters have changed since then?

I thank the hon. Gentleman for that question. I will come on to the 2004 vote in a little while. It was indeed a very low turnout, as my hon. Friend the Member for Great Grimsby (Austin Mitchell) says. People recognise when we are talking about a talking shop and not talking about action. I think that the debate has moved on. The campaign has been growing in momentum in the past 12 months, as I said. The Hannah Mitchell Foundation is growing and getting support from all quarters.

I am most grateful to the hon. Lady for giving way again. I do not want to keep interrupting her, but last May certain parts of the region were offered mayors, who would surely be a form of devolved administration and powerful local leaders, but they were rejected. Given that that forms part of the “January declaration” on the north-east, does she not agree that a mayor would be a very good way forward whereby cities could come together and have a powerful local voice driving things, much as people do in London or Paris, for example?

I thank the hon. Gentleman again for his intervention. No; I would like to see a regional government for the north, using its powers to fight for the whole region, not individual areas. That is done very well now in some cases, but I want to see the whole region being represented.

As my hon. Friend the Member for Leeds West (Rachel Reeves) said in an excellent speech to the Institute for Public Policy Research on Monday, we need

“long term reforms, including a coherent industrial strategy, to make the most of the North’s strengths and to give businesses and working people of the North a better chance…such an agenda will only work”

if it is

“in the hands of the people who are best placed to move it forward”—

that is, if there is a radical devolution of power and resources to the north.

I shall outline what is needed. We do not want local authorities to be undermined; we want them to be a key partner of strong regional government. The regional and local government structures should complement each other and work together positively. This is about transferring powers from Whitehall and outlining areas of policy on which regional government could provide a real focus, with powers drawn to the north, for the north. It is not about weakening Britain, but about making it stronger, more democratic and economically successful. We have only to look at post-war West Germany to see how successful regional government has been in creating an economic and political powerhouse. As long as England remains so centralised and London-focused, the north’s economy will never reach its full potential.

The recent key report by the Institute for Public Policy Research was as timely as it was revealing. Yes, we can differ about its conclusions, but the basis on which its findings were made cannot be ignored. I want to avoid throwing figures at the Minister. We all know that unemployment is worse in the north than in the south, that job opportunities in the north are fewer and that public sector spending cuts are not as easily absorbed in towns such as Halifax and Huddersfield as they are in Harlow and Huntingdon.

The IPPR report underlined how the economic potential of key towns and cities across the north could be a powerhouse of economic growth in the next 20 years, and how key powers need to be transferred to the region by central Government. The levers of power urgently need releasing and sending back to our regions so that areas such as Leeds, Liverpool, Hull and Newcastle can have their potential tapped, economic opportunities can be released and social changes can be met. It is time for central Government to let go a little bit.

Over a period of years—perhaps even decades—the increasing centralism of decision making has left the north without a proper democratic and accountable voice that can champion the area, boost investment and protect jobs. Yorkshire Forward did many good things and was a strong voice for regional development, but that, sadly, has long gone. I want to see something much stronger than that—elected regional government that has real powers and the chance to do things, not just talk about things.

We can argue about the mechanisms and structures at a later date. What we need is a green light, or even a nod in the right direction, that regional government is going to happen and can be achieved. Yes, some could say that the matter was rejected by the people of the north-east in a referendum in 2004. That was little wonder when what was on offer was lukewarm at best. People can recognise a talking shop from a long way off. I do not want a northern debating chamber that is full of hot air—that talks but does not do—nor one that will just create jobs for the boys. I want to see better employment prospects for the people of Halifax and other towns in the north, and regional government is one way in which that can be achieved.

Regional government could tie together transport policy, planning and job creation. A good example is the current plan to devolve power for rail franchising to the north of England, which I very much welcome. However, special governance arrangements are having to be put in place to ensure that no fewer than 33 local transport authorities have a say in the process. How much easier would it be if there were one accountable body for the north that could provide accountability to the proposed rail in the north executive and drive forward a much-needed programme of investment in our rail network?

We are, I believe, at a turning point in relation to our democratic structures. We talk about transferring powers back from Europe and of transferring more powers to Scotland, perhaps with independence. Wales has its own Parliament. Why should central Government not enable us to have a regional government for the north, north-east and north-west?

I thank the hon. Lady for giving way in this important debate. As a proud Yorkshireman, there is nothing I like more than championing the north, but I do not want more bureaucracy. Does she agree that Yorkshire has had a fantastic month? We are hitting above our weight, with the announcement that High Speed 2 is coming to Leeds, Welcome to Yorkshire’s hard work to get the Tour de France to come to our area and the regional growth fund investment. We do not need more bureaucracy. We need to build on the success that Yorkshire and the north have had in the past couple of months.

I thank the hon. Gentleman for his intervention. Yes, we can build on what is already happening. The HS2 decision shows that the Government recognise that we need more investment and jobs in the northern region. Transport is one way we can move forward. I, of course, welcome the Tour de France coming to Yorkshire. With a stronger voice shouting for us, we could build on those announcements and show what a wonderful area it is in which to live.

I promise that this will be the last time I intervene. Let us look at the northern hub, for example. With respect, it was promised for years under the previous Government, but came to fruition only under this Government. We are transforming the railways in the north. The hon. Lady talks about infrastructure, but surely that is a classic example of central Government getting out of the way to allow local infrastructure development and positive steps to take place without the bureaucratic talking shop she proposes.

I do not propose a talking shop. That is the last thing I want. Transport is a major area that we need to do something about. I travel on trains from Halifax—they are not the best. One of my major campaigns at the moment is for better carriages on the line. They are much better in other areas. If the hon. Gentleman travels from Halifax to Leeds, he will see that there needs to be improvement.

Many key regional decision-making powers that currently lie with quangos, could be transferred to a regional government. Would the Minister like that to happen? We have a once-in-a-generation opportunity to grasp the nettle and achieve our goal. I do not believe in regional government for its own sake, but passionately believe that it will benefit millions of people in the area and stop the trickle of money south out of the region.

Doing nothing is not an option. If we do not act, the north risks falling further behind Scotland, as the Hannah Mitchell Foundation has rightly outlined, because the north of England risks being squeezed between the south-west and a resurgent England and Wales. Does the Minister agree that that might happen unless positive action is taken to address the northern democratic deficit? People argue about having more forms of government, but I do not propose that at all. Powers currently exercised by Westminster and Whitehall would simply transfer to the regions, as they have to Scotland and Wales. The key objective of any regional government proposals must be to ensure that whatever emerges costs the public no more than the current arrangements.

As I said at the beginning, this is an idea whose time has arrived. We need real purpose from all major political parties to drive it forward and ensure it happens. If it is good enough for Scotland and Wales, it is good enough for the north. The Government talk of localism; now they need to act on that and deliver it. It is about democracy, fairness, community and co-operation. It is about helping the north to realise its untapped potential, and about making our region stronger and bigger and ensuring that we are at the forefront of our economic revival.

For too long, power and wealth have been sucked to the south from the north. The journey to reverse that trend should now begin. It is time that the northern regions stood up for themselves and were allowed a democratic, powerful and valued voice. If it does not happen, we risk being left behind an ever more powerful Scotland and London in the coming years. It is time to stop the talking and get on with providing a new vision for the north. The Hannah Mitchell Foundation has started and led the debate. It is now time for central Government to join in and kick-start the process to ensure that we have a radical voice for the north as soon as possible.

Does the hon. Gentleman have permission to intervene from the Member whose debate it is and from the Minister?

Thank you, Mr Amess. I certainly asked for permission.

I congratulate my hon. Friend the Member for Halifax (Mrs Riordan) on raising an issue whose time has come—one might say its time has come again. It is clear from Lord Heseltine’s report that there is a need for the devolution of power from the centre, which always safeguards the interests of the south and developments in London, to the north. The Government want to do it through local enterprise partnerships, and I agree that it should be done, but doing so through LEPs would cover the north in a patchwork quilt of smaller, business-led local authorities that do not have the large-scale popular involvement that we need to energise the north.

The hon. Member for Hexham (Guy Opperman) is correct to say that a referendum was defeated in the north-east, but what was on offer was not worth voting for. As I told Lord Prescott at the time, the vote was very low and mainly an anti-Government vote, not a judgment on regional government. Regional government is necessary to tackle the problems common to the whole of the north, to put the north’s interests into the debate and to hold some of the powers that the Scottish Government hold. Devolution has been effective in Scotland in energising development and bringing Scotland up to higher levels of attainment and performance. We need that kind of devolution for the north.

The north could and should be united——uniting the three old development regions into one powerful authority to give us more power to pursue and develop our own destinies, involving the people and energising the whole area. That is all I want to say. It is time for the debate to begin. I congratulate my hon. Friend the Member for Halifax on beginning it.

It is a pleasure to serve under your chairmanship, Mr Amess. I congratulate the hon. Member for Halifax (Mrs Riordan) on securing the debate. It is good to have an opportunity to go through some of the pros and cons of what we can do for particular areas.

I fully share the hon. Lady’s views on the importance of growth in the north of England and of decentralising and devolving power from Whitehall into and closer to communities across the country. However, her proposal to establish regional government for the north is simply not the right way to achieve that. I would like to explain why that is so, then go through in detail what the Government are doing to deliver a real devolution of power so that there is economic success throughout the country.

As the history has been mentioned by hon. Members, I shall touch on it and correct one point, which will slightly change their interpretation. The establishment of regional government—evidenced by the failed attempts in 2004 to create a regional assembly in the north-east, which hon. Members touched on—is founded on a total misunderstanding of the traditions, culture and realities of this country. The hon. Lady referred to the 2004 referendum; as she noted, the electorate in the north-east overwhelmingly rejected the proposal for regional government, with about 78% voting no. A comment was made about turnout, but it was almost 50%, so the vote was a clear comment from the people in the area. Does she really believe that the views of the people in the north-east have changed so much that they would now welcome a regional government, of whatever form, with open arms? I am not convinced.

Federal arrangements in countries such as Germany are founded on centuries of culture and tradition. In this country, we do not have that history or tradition. Ours is a tradition of local government and counties—the great counties of Norfolk, Yorkshire, Lancashire and Northumberland, to name just a few.

I do not know whether the Minister has seen today’s article about the next Archbishop of Canterbury. The Minister asks whether I believe that people in the north have changed their mind. The next Archbishop of Canterbury is quoted as saying that that area is going back to the ‘30s, so perhaps they have changed their mind and need the investment that a regional Government would bring.

I am not quite sure why the hon. Lady is putting those two issues together. From travelling round the country to various counties, my view is that people tend to identify with their county, town or city, borough or neighbourhood, not an arbitrary, centrally imposed government region that, as hon. Members have commented, simply adds a tier of administration that is rarely effective or efficient and is certainly not popular.

I am delighted to say that this Government have swept away the eight government regions, regional development agencies, regional strategies and regional leader boards, which were all based around regions that were completely artificial and had no resonance with the cultural, social and economic realities of our country.

The Minister is right that localism in its purest form is an exceptionally popular feature; certainly, it is massively welcomed in Northumberland. I suggest that he go an extra mile and propose the disbandment of the unitary authority that was created by Lord Prescott of Hull. Localism would then return to its purest form, and we would get back Tynedale district authority, which is much missed. I assure the Minister that that would make him the most popular man in Hexham that there has ever been.

I thank my hon. Friend for his intervention. As he rightly points out, the unitary authority in Northumberland was set up by the Local Government and Public Involvement in Health Act 2007. I do not doubt that I would make myself very popular if I were able to return Tynedale district council to Hexham. Unfortunately, the aforementioned Lord Prescott created a structure that ensures, at the moment at least, that that simply cannot happen, which is why we are reticent about going down that kind of road. It is exactly because of our commitment to localism and decentralisation that we scrapped regional government, reduced spending on bureaucracy and transferred power to local councils and beyond.

Would the Minister not accept that he is putting the traditional Conservative arguments against the devolution of power to the people that were put in opposition to devolution to bodies in Scotland and Wales? Those arguments have been shown to be false by the success of those bodies.

The hon. Gentleman completely misses my point. I am saying that the Government are devolving power directly to people. There is a misapprehension that localism is about giving power to councils. Understandably, some powers will go to councils, but localism is about moving power to people in their communities, so that they have control over those communities. It is respect for the traditions and beliefs in such communities that means that artificial, centrally set regional governments simply cannot work.

Since we swept those regional governments away, no one—other than perhaps a few bureaucrats—has generally mourned their passing, at least not until this morning. Indeed, only yesterday, I attended the launch of a report published by the Select Committee on Political and Constitutional Reform, which is chaired by a member of the Labour party, that outlines the prospects for codifying central and local relations. It states:

“An attempt to introduce regional government in England was abandoned in 2004 after the North East of England rejected proposals for a regional assembly. There were no submissions suggesting a return to regional government. We do not suggest a revival of regional government for England. There is neither the political nor public appetite for this. Local government should be the vehicle for devolution in England.”

For all these reasons—identity and traditions, practicability and efficiency, bureaucracy and effectiveness, and the lack of a political and public appetite—it is clear that the pursuit of regional government is not the way fundamentally to shift decision making away from Whitehall. It would simply shift decision making from Whitehall to an artificial regional-tier construct. Local authorities are best placed to receive powers and take critical decisions on local economic growth and on the public services that impact on the day-to-day lives of our citizens; business rate retention and the new homes bonus, with the Localism Act 2011, are moving power that way.

To follow up the comments by the hon. Member for Halifax (Mrs Riordan) and those of the Minister, two groups are forming positive local solutions in the north-east: Lord Adonis is meeting various members of the local community, and an organisation has created the January declaration. I urge the Minister to study that manifesto and to meet me, because in the north-east, particularly in Newcastle and Gateshead, there are genuine efforts to take localism—working with the local enterprise partnership and local communities—and create strong ways forward that do not involve a regional assembly, but involve all local infrastructure and positive steps. I suggest that that is what we all want.

My hon. Friend makes a good point, and I am very happy to discuss that with him. He highlights that where things are working more positively and there is real progress around the country is where there is no artificial, centrally determined sector, region or body, but something that is led by the people in the community. Local enterprise partnerships have such ability and opportunity because they are led by the people in the communities, who understand their traditions and have a vested interest in seeing their local area grow and in working together. We must trust local people and locally elected and democratically accountable councillors to work together in the interests of their communities. That is what localism is about.

Let me touch on how this Government are devolving power to support that process. The Localism Act, which I have mentioned, and the Local Government Finance Act 2012 have devolved more power and greater control over finances than ever before. For example, the general power of competence turns previous assumptions completely on their heads. It gives councils real power to get on and do things, and the room to take action and innovate without seeking permission from the centre, as they previously had to do. We have un-ring-fenced funding, given local authorities greater control over their resources, and put in place proposals to encourage local economic growth.

We are delivering growth and jobs. The hon. Member for Halifax mentioned the imbalance in our economy. We are already addressing that through such things as city deals, which are recasting the relationship between central Government and our cities. They are giving our great cities the powers and tools that they need to drive economic growth in their areas. For example, through those deals, we have supported cities with a £75 million regeneration fund for Liverpool; an earn-back proposal from Manchester that could be worth more than £200 million; a new development deal in Newcastle worth £60 million; and smaller new development deals in Sheffield and Nottingham.

I will focus for a moment on Yorkshire and Humber, which includes the hon. Lady’s constituency. In that area, we have supported, among other things, the Aire Valley Leeds enterprise zone, which focuses on life sciences, advanced engineering and low carbon industries, and aims to create 3,780 jobs; the Humber renewable energy super cluster, which is creating 4,850 jobs; and the Sheffield city region enterprise zone, which aims to create more than 8,400 additional jobs, with an additional £400 million in economic output. We have also invested more than £73 million for local enterprise partnerships in Yorkshire and Humber as part of the Growing Places fund, and a total of £264 million through rounds 1 to 3 of the regional growth fund—it has already been mentioned—which has created or safeguarded more than 63,000 jobs over 10 years and leveraged £1.433 billion of private sector investment.

We are also opening the way for local authorities to work in partnership across economically significant areas through the establishment of combined authorities, which provide a practical way for local authorities to work together. For example, the establishment of the Greater Manchester Combined Authority has brought together local authority leaders. It will strengthen their voice and influence, thus increasing their ability to promote their area with businesses and other partners, and to grow investment and deliver jobs for local people. We are establishing other combined authorities in the Sheffield city region and west Yorkshire. With the authorities in the north-east, we are also considering how a combined authority would support them in further strengthening their leadership and economic development.

That comes back to the main point made by my hon. Friend the Member for Hexham (Guy Opperman). The approach is led by the local community, which comes together to tell us in government what they want and what will help them, rather than our having a top-down approach.

I thank the Minister for telling us about all the investment in the north. To include transport, will he join me in welcoming the investment by First TransPennine Express, which has been announced today, of £60 million for 40 new carriages? That will increase capacity by 30%—linking Leeds to Manchester, Newcastle and Hull—which is more good news for the north.

Absolutely. That is great news for the north of our country of investment coming in.

As time is short, I will just say that we are as enthusiastic and committed as anybody would be about growth and devolving powers—taking power away from Whitehall and giving it back to local people. However, what we will not do and what would be wholly wrong is to take powers from Whitehall and put them in an artificial construct, which creates pointless discussion, bureaucracy and inefficiency. Local residents have no confidence in and show no loyalty or commitment to such constructs, which therefore tend to end in failure. Our approach is already devolving power and driving growth. We have opened the door to the significantly wider transfers of powers not only to the north, but to the south, east and west—to our entire country—without any new bureaucracy. I hope that the hon. Member for Halifax will come to see that it is our approach that, in driving growth through decentralisation, will realistically achieve her aims, which are ones that she and we must share.

Sitting suspended.