The Government recognise the importance of closing the economic gap between regions of our country as an economic and social priority, and the industrial strategy is focused on doing that. If we eliminated just half of the productivity gap with London, we would add £300 billion to our gross domestic product; that is £4,600 for every man, woman and child in this country. That is why the Budget announced a raft of measures designed to move forward our progress on that.
The economic case for a wider Yorkshire devolved settlement is compelling, so much so that in Yorkshire it is supported by the CBI, the Institute of Directors, the Federation of Small Businesses, the TUC and many of the Chancellor’s own colleagues in local government. Does he recognise the strength of the economic argument, and, if he does, can he speak to his colleagues in the Department for Communities and Local Government?
The Government are committed to the Sheffield city region deal, which will bring £1 billion of new Government investment to the area. We recognise the debate that is going on about a possible wider Yorkshire-based deal and we are happy to consider that, if it can be done in a way that does not disrupt the existing deal that has been agreed for the Sheffield city region.
The Bank of England deputy governor recently argued that Brexit could lead to a “sharp step down” in the UK’s productivity growth. That is likely to hit regions in different ways, and today the Social Mobility Commission talked about the “widening geographical divide”. What impact does the Chancellor believe the extra resources that he has talked about in the light of preparation for Brexit will have on tackling regional productivity issues and social mobility?
We know some of the things that drive our low productivity performance. Regional differences are one of them, and others are low levels of capital investment in private businesses, relatively low levels of public infrastructure investment and poor skills. We set out in the Budget a raft of measures that will address all of them. The end result is that this Government, on average, over this Parliament will be investing £25 billion a year more in real terms than the Labour Government invested over their period in office.
To encourage economic growth in Stoke, the local council is offering serviced plots of land to finance directors and managing directors to build big houses, bring their businesses and invest, creating more jobs and more economic growth. Does the Chancellor agree that that model could be followed elsewhere? Does he agree that it shows that, as in all other areas of social policy, self-build and custom house building has a great deal to offer, including for economic growth?
Will my right hon. Friend join me in welcoming the potential for £40 billion of investment in the north-east of Scotland region oil and gas industry, as a direct result of the tax relief announced in the Budget, and could he encourage the SNP and Scottish Labour to get on board?
I am absolutely happy to agree with my hon. Friend. The North sea as a basin is coming towards the end of its life, but none the less there are many billions of barrels of oil to be exploited there, involving very large amounts of economic activity in the region and potentially significant receipts to the Treasury. The measure that we have taken will stimulate economic growth in the region and, if all goes well, generate a windfall to the UK Exchequer.
Thanks to this Government’s investment of £22 million pledged via the local enterprise partnership, Cheltenham can look forward with confidence to a cyber-hub, creating a centre of cyber-excellence in the home of GCHQ. Is that not exactly the kind of project that will drive opportunity and boost productivity in constituencies such as mine?
No wonder the hon. Member for Mid Norfolk (George Freeman) referred to a leadership academy; three quarters of the Cabinet are queuing up to get into it. What impact does the Chancellor think a £1 billion, two-year grant—equivalent, let us say, to the one he gave to Northern Ireland—would have on regional economic growth in, for example, the constituency of my hon. Friend the Member for Barnsley Central (Dan Jarvis) in the Sheffield city region?
I do not like to blow my own trumpet, but on the whole I think my jokes were better than the hon. Gentleman’s. As I said to the hon. Member for Barnsley Central (Dan Jarvis), the Sheffield city region deal would bring £1 billion of new Government investment into the area, which will stimulate local economic growth and job creation, and support upskilling in the area and improvement of the infrastructure. Doing these deals around the country and making funds available to local authorities—they know best what is necessary for their areas —is the way to deliver enhanced economic growth.
I will give the Chancellor another opportunity to answer a similar question in relation to improving regional productivity. What would be the impact in, let us say, the south-west region, in the constituency of his hon. Friend the Member for St Austell and Newquay (Steve Double), if the Chancellor provided for that area a £1 billion, two-year grant commensurate with that for Northern Ireland?