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Local Economic Growth

Volume 620: debated on Tuesday 31 January 2017

One of our most important reforms has been to devolve power and resources to local areas through city deals, devolution deals and growth deals, in which local businesses can shape the decisions most affecting them. The hon. Lady will have welcomed last week’s announcement that half a billion pounds was devolved to northern local enterprise partnerships, including £130 million to Greater Manchester.

I welcomed most of the announcements in the industrial strategy last week, but the Secretary of State will appreciate that a local area strategy is required for key infrastructure issues such as skills and childcare. What conversations has he had with colleagues in the Department for Education and across local government about the meaningful devolution of skills, early years and education?

The hon. Lady is absolutely right that the needs of different places should be reflected in decisions that are made locally. Along with the centrality of skills and training, that is a big theme of the industrial strategy consultation, to which I hope she will respond. I look forward to her contribution.

Business investment in science and technology is key to local economic growth and Britain’s leadership of the fourth industrial revolution. Will the Secretary of State continue supporting LEPs to fund these key sectors and technologies?

I will indeed. One of the big opportunities is to make sure that the excellence we have in science and research is married with local strengths so that we can have the products of that research, in manufacturing for example, as well as the discoveries themselves.

Northern Ireland has only one very small enterprise zone, which is up in Coleraine and has not really progressed. Can the Secretary of State give any support or assistance to the Northern Ireland Executive, when they are up and running again, for more enterprise zones within the Province?

I have, as the hon. Gentleman would expect, conversations with Simon Hamilton, the Minister responsible in Northern Ireland. My colleagues and I are very happy to consider his suggestions and proposals when we meet him.

I declare an interest as a member of Kettering Borough Council. The borough of Kettering has had one of the fastest rates of business rate growth in the whole country in the last 10 years. Does my right hon. Friend agree that, with local government to be fully funded by business rates from 2020, all local councils will have to get far closer to their local businesses in order for local economies to function as best they can?

My hon. Friend is absolutely right and, as a councillor, he knows how important it is that that very direct connection is made. It is one of the measures going through the House that I was proud to have proposed when I was Secretary of State for Communities and Local Government, and it is something for which local government has long campaigned. I am delighted that it was this Conservative Government who were able to deliver it.

Bank lending is essential for local business success, and yesterday’s HBOS convictions are a stark reminder of the way that smaller businesses were treated by some banks during the financial crisis. Does the Secretary of State accept that lending has fallen over the last year? What is he doing to give confidence in the banks, unlock support and increase lending?

The hon. Gentleman is absolutely right to draw attention to the misbehaviour of the banks, especially with regard to small businesses, when they were inadequately supervised as a result of the destruction of the supervisory regime under the previous Labour Government. That has now been put on a much sounder footing. He will know that the lending opportunities for small businesses have been transformed, but the industrial strategy Green Paper is very clear that we want to make further opportunities available, particularly outside London and the south-east.