§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Mather.]
11.26 pm§ Mr. Jack Dormand (Easington)The Minister will recall that I raised the subject of the proposed dissolution of the Peterlee development corporation in an Adjournment debate on 18 November 1981. He said then that no firm decisions had been taken, and I therefore think it reasonable that a year and a half later I should ask what the Government's thoughts are on a matter that is of crucial importance not only to my constituency but to the sub-region for which Peterlee provides employment.
It would have given me a considerable satisfaction to say that things had improved so much in my area that there would no longer be a need for the corporation after 1985. However, the opposite is the case, and there have been job losses on an increased scale. In recent months, apart from other losses, two pits have closed, and the Minister knows that coal mining is the major occupation in my comstituency.
In his reply to me in the previous Adjournment debate, the Minister said:
I think that the key answer to the problems in the North-East is inextricably linked with the fortunes of the economy as a whole and that the revival of the economy generally will bring a solution to the problems of the North-East." — [Official Report, 18 November 1981; Vol. 13, c. 401–2.]That is only partly true, because it ignores the important role that regional policy plays. However, here we are, 18 months later, and the national economy has deteriorated and continues to decline. In that deterioration the north remains, as it always has been, the region with the highest unemployment. We are little more than two and a half years away from the dissolution. The Minister is too intelligent and too honest a man to say that the expertise and the resources of the corporation will not be needed after such a short period and in such worsening circumstances.The corporation's record speaks for itself. It now has a stock of 200 factory units, employing 5,200 people. In the past two years more than 1,300 jobs have been created, almost 300 of them in over 30 new companies that have been attracted to the new town. Extensions to existing factories are no less important. Eight firms have had extensions built, and five more extensions are firmly planned.
The corporation and everyone concerned with the future development of the area are anxious that we attract the newer type of industry, including high technology, and here again there is a record of success. There are no fewer than 15 firms from foreign countries established in Peterlee, all doing work far removed from the traditional employment of county Durham. I remind the Minister that one of the reasons for building a new town in the area was to provide alternative employment when pits closed, and that has never been more important than it is now.
The Government could properly ask whether these achievements could have taken place without a body such as Peterlee development corporation. Let us consider the matter. There are three bodies which could — and, indeed, do — help with the area's unemployment problems. They are Easington district council, Durham county council, and the North of England development council. The Minister probably already knows that 1044 Easington district council fully supports my plea for an extension of the corporation's life. It acknowledges the expertise and resources of the corporation, and I am bound to say that it has enough on its hands, not least in dealing with the appalling condition of some of its houses. The Minister will not want me to discuss that matter, because he and I have crossed swords on several occasions on this issue, but it is worth mentioning in this context. The vast sums that are needed for repairs have not been accepted by the Government, who finally decided recently to make the completely inadequate contribution of about £7 million towards what the Minister knows from his personal inspection of some of the houses in Peterlee is a huge problem.
So, for a number of reasons, Easington district council is anxious and enthusiastic that the corporation should remain in existence. The other two bodies could not be expected to devote the necessary attention to what is only a part of their area. Nor could they make a detailed appreciation of the sub-region's needs and problems. In saying that, I make no criticism of the county council or the NEDC, which both already do what they can to help, but that help, by definition, is limited.
In addition, I reiterate the praise that I frequently express to the staff of the corporation. They have a dedication and loyalty to our area. Their expertise is second to none. Moreover, they are given superb leadership by the general manager. Perhaps I should also mention the chairman of the corporation, whose appointment by the Government I criticised at the time but who I recognise makes a most effective contribution to the corporation's work. Indeed, I am tempted to say to the Minister and the Government, "If you do not accept my view of the situation, ask him about it."
There are two aspects of the corporation's work that are particularly valuable and impressive. I can describe the first as the "package deal" that is offered to potential tenants. An incoming industrialist, particularly one from overseas — I have already said how successful the corporation has been in attracting foreign firms—has enough technical and labour matters to deal with without having to bother with other problems. It is here that the corporation makes such a valuable contribution in dealing with matters such as site, costs, location, staffing, housing, and so on. I know from my own dealings with Peterlee managers how much they have appreciated that help at such a critical time in the establishment of a new business.
However, the corporation goes further. The second aspect is what might be termed "after sales service". I have visited dozens of factories in Peterlee, and one of my standard questions on such visits is, "Do you receive all the help that you need from the corporation?" During my 13 years of visiting I do not recall a single instance of dissatisfaction. That is a remarkable record and a splendid tribute to the work of the development corporation.
Much of that excellent work stems from the fact that the managing director and the marketing director have worked in outside industries. The lack of such experience in new towns and, indeed, other industrial sites, is frequently criticised by incoming industrialists. Therefore, it is particularly appreciated by them.
The corporation concentrates on small businesses with its business centre and has a successful key course training scheme. That should be particularly appreciated by a Government who profess to have a special interest in small 1045 firms. I could give further examples of the effectiveness of the corporation's work, but I hope that I have said enough to convince the Minister of the valuable and essential contribution that it makes to the area.
It could be asked why, since most job-finding agencies do such work, Peterlee development corporation should receive special treatment. There are two answers to that question. First, the proof of the pudding is in the eating. Here we have an outstandingly successful organisation producing results, and even to consider changing its structure at such a difficult time would be an act of the greatest folly. To do so would be to murder the area. Secondly, I doubt whether there is another job-finding agency exactly like this one. Its experience has honed it into a unique organisation and I challenge the Minister to give examples of other bodies which so closely meet the needs of their areas.
There is an astonishing statistic which must dispel any doubt about the points that I have just made. According to Durham county council, Peterlee development corporation is attracting three quarters of the new jobs that are coming into the county. Incidentally, the corporation is more modest and says that it is pulling in only two thirds of the new jobs. Whichever figure is correct, it is a measure of the crucial role that the corporation plays in our unemployment problems.
In saying that the life of the corporation ought to be extended I am not urging an open-ended response from the Government, but there cannot be the slightest doubt that it will be required until 1990, at which time there could be a major assessment of its role in the sub-region. I mention that because the Minister and I had a slight misunderstanding some time ago when he thought that I was urging an open-ended commitment. That was not the case. What I have just said shows that I recognise that that is and always was the Government's view. We know that it was never their concept or philosophy that new towns should continue forever.
I am confident that the Government will realise that the area has not changed to the extent that they had hoped when the proposal to end the corporation in 1985 was made. I have argued tonight that the position has deteriorated, and to adhere to the target date of 1985 would be unthinkable. If the Government were to strike this formidable weapon from our hands they would be even more imcompetent and uncaring than I thought. But I am sure that the Minister will accept the evidence and be prepared to look anew at the problem.
Finally, I ask the Minister to reject any fixed and doctinaire ideas on this important issue. I ask him to remember that he is dealing with the future of thousands of people who over the years have had to tolerate the worst features of a declining industrial area. Lengthening the life of Peterlee development corporation will certainly not solve their problems, but it will make a valuable and important contribution to improving and sustaining the standard of life that they so richly deserve.
§ Mr. Derek Foster (Bishop Auckland)The argument so ably put by my hon. Friend the Member for Easington (Mr. Dormand) applies equally to my own area, the town of Newton Aycliffe and the development corporation operating in that new town. I speak as an ex-chairman of the North of England development council, to which my hon. Friend referred, and an ex-chairman of the economic 1046 development committee of the Tyne and Wear county council, so I have considerable experience of the great difficulty of attracting jobs to areas such as the north-east. I say without fear of contradiction, as my hon. Friend has said, that the north-east new towns have been the most successful job-hunting agencies imaginable. If that job-hunting role disappears it is hard to see how the gap could be filled.
The situation would have been difficult enough before 1979, when unemployment in the region was already bad enough. Since then we have seen job destruction on a scale that we never imagined was possible. To imagine that the new town development corporations, or at least their job-hunting roles, can be removed now without providing an equally effective agency to take over that role — we should need a great deal of convincing about how that could be done—would cast the Government in a role that would be heartless and callous in the extreme.
I hope that the Minister will tell us today either that he is prepared to consider the extension of the development corporations or at least that he has a scheme to replace them that he can convince us will be just as effective in trying to ensure the prosperity and jobs that our people so badly need.
§ The Under-Secretary of State for the Environment (Sir George Young)As the hon. Member for Easington (Mr. Dormand) said, he and I have been round this course before. I found a certain familiarity in his arguments and he may detect a few old friends in my reply.
I begin by congratulating the hon. Gentleman on his diligence in pursuing this matter, not just on behalf of his constituents but because, as he has said, it raises broader issues for the north-east and for Aycliffe and Washington development corporations. He is right to raise the question of the Peterlee development corporation's future again now that we are nearly a year and a half nearer to the target date for dissolution. I also note the remarks of the hon. Member for Bishop Aukland (Mr. Foster) about the Aycliffe development corporation.
As both hon. Members know, the new town development corporations were set up with the specific purpose of developing their areas as new towns. Even the New Towns Act 1946 provided for their dissolution when the task was done. Both hon. Members will know, too, that we have now set target dates for the dissolution of all the English new towns.
The setting of a target date represents a public declaration of intent by the Government. It embodies an expectation that by that date the corporation's purpose of developing the new town will have been substantially achieved. It provides a desirable reference point for the corporation's planning. It is of the essence of targets, however, that they may be missed as well as hit —perhaps "replaced" is a better way to put it—as the initiative in setting a difference target rests with the Government if, in our view, circumstances warrant it. As both hon. Members will know, that is exactly what we did in the case of Washington—replacing the 1982 date set by the previous Administration with a new date at the end of 1985. I hope that our decision in that case will convince both hon. Members that our approach is not doctrinaire or dogmatic.
As the hon. Member for Easington said, he now accepts that the corporation at Peterlee should be dissolved one 1047 day and that it is sensible to set a target date for that. We disagree about the timing. He has suggested 1990 and we have set 31 December 1985 as our target date. I hope that the hon. Gentleman will recall what his right hon. Friend the Member for Stepney and Poplar (Mr. Shore), who was then the Secretary of State for the Environment, said about wind-up dates for Peterlee in a press release that was issued on 29 July 1977. He said:
When a decision is reached on the request to designate more land at Peterlee, discussions will take place with the Development Corporations and local authorities concerned about the arrangements for winding up both Development Corporations in the early 1980s.We have in mind a later date than was planned by the previous Administration.The corporation is, of course, planning on the basis of that 1985 target date and has gone some way towards making it a reality. Its rented housing was transferred to Easington district council in 1978, with a subsidiary transfer scheme in 1980. Work is also going ahead well on the private sector housing development at Oakerside, the last major area available for housing within the designated area of the new town. The future of Castle Eden Dene is being actively discussed with the local authorities, the Nature Conservancy Council and other interested bodies; and we hope that a way of preserving this important natural resource after the corporation's dissolution can be found so that future generations, especially school parties, may be able to continue to enjoy it. We expect that the corporation will shortly be opening discussions with the district council with a view to a package of community-related assets being transferred to it on acceptable financial terms. Some progress in selling the corporation's industrial and commercial assets to the private sector has been made. Some undeveloped parcels of land remain on the industrial estates, but some of it is the subject of options by adjoining owners. Some of the remainder could well be the subject of firm arrangements for development by the end of 1985. In short, as for the development of the designated area, it seems likely that the corporation's purpose has been, or will, by the end of 1985, be substantially achieved. A fully viable new town community has been created and, by then, a substantial reduction in the corporation's assets will have taken place, thus making its dissolution a reasonable and practical course from that point of view.
The development corporation will, of course, continue to enjoy the appropriate level of Government support in its capital investment allocations so long as it remains in existence. For 1983–84, for example, the allocation will permit the corporation to open up further land for private housing development at Oakerside, to start work on the first phase of a speculative "high tech" development on a prestige site adjacent to the A19 and to build extensions to existing factories when the companies concerned cannot finance them themselves. Even further speculative factory development is not ruled out if a good case can be made, for example, on the grounds of need to offer a reasonable range of premises for incoming firms, and if private sector finance is unobtainable.
As the hon. Gentleman made clear in his speech, he appreciates the work that the corporation has done over the years to attract industries to Peterlee. It is, indeed, an impressive record. The industrial estates now provide well over 3 million sq ft of factory space, and a further 100,000 1048 sq ft is under construction. Moreover, they provide employment for some 5,200 people. It is creditable that in spite of the recession those figures marks a net gain over the comparable 1981 figure. The corporation's estimate is that Aycliffe and Peterlee together produce about 60 per cent. of the new jobs that are coming into the county and the county council's estimate of their achievement is even higher.
The quality of the firms attracted recently and the industries concerned are also noteworthy. I referred in our previous debate to the establishment at Peterlee of Fisher Price which is one of the many companies which have since decided to extend their premises there — it is indeed a five-fold increase in size. Though not in one of the generally recognised growth sectors, it is providing reliable and expanding employment, reinforced by making Peterlee its European headquarters. NSK, a Japanese enigneering company, is funding a £3 million extension which is now in progress. The success of the corporation's overseas marketing is reflected in the fact that overseas companies provide about one quarter of all the jobs in Peterlee. Those achievements are the result of well-organised and properly monitored promotional efforts both in Britain and on overseas visits, and close attention to the detail of the many services and answers that an industrialist considering a move will need.
Perhaps the very smallness of the team has helped, together with the able leadership of the chairman, Michael Straker, and the managing director, Gary Philipson. I know that the chairman will appreciate what the hon. Member for Easington said about him. No doubt also the scale of public investment that previous Governments were prepared to authorise in the earlier stages of the town's growth helped, but there is no question of expecting the continuation of public investment on that scale at present. In general, further major investment will be from the private sector.
Both hon. Members made it clear that their main concern in this debate was to secure that, for as long as the need remains, the task of attracting jobs to Peterlee and a wider area of the north-east should continue to be carried out as effectively as it has been by the corporation. We accept that unemployment is far too high in the north-east, as in other regions, and there is also a shadow cast by the possibility of further job losses in the region's older industries. However, there are now signs of an upturn in the national economy, which must be the key to the problems of the north-east, although energy and expertise in job attraction will continue to be needed for some time.
As to the effective continuation of the task of attracting jobs, several other bodies — the hon. Gentleman mentioned local authorities—deal with various aspects of that in the north-east, besides Peterlee and the two other new town development corporations. For example, the Department of Industry has a regional office that has directed to Peterlee several inquiries from industrialists interested in setting up in the area. Both hon. Members mentioned the North of England development council, which recently took on the task of co-ordinating the promotional activities of itself, the development corporations and local authorities in its area, with the aid of a greatly increased Department of Industry grant. The English Industrial Estates Corporation has, with its new management and wider powers under the 1981 Act, been making a valuable contribution to the provision of jobs in the region. It has long experience of factory development 1049 and estate management, and has recently branched out into office development and the provision of starter units for new technology projects. It has also been successful in obtaining private sector investment for some of its new developments. Several local authorities have achieved some success in industrial promotion, dealing effectively with industrial inquiries and, in some cases, constructing factories themselves.
It may not be impossible, assuming that the need to attract jobs continues in the north-east, for those bodies together to take over the development corporation's role in industrial promotion. I do not see the case for inventing an additional, brand-new body in the form of a Northern development agency, which has been suggested.
§ Mr. FosterWhy not?
§ Sir George YoungIt would be additional bureaucracy that would not provide an effective service over and above the alternatives that already exist.
When we previously debated this matter in November 1981, I promised the hon. Gentleman that we would review the future of Peterlee in due course with an open mind, not ruling out the possibility of extending the corporation's life. In any case, before a decision is taken to confirm the timing of the dissolution, we are required under the New Towns Act 1981 to consult the county and district councils immediately concerned. What I said then remains as true today. An extension of the corporation's life is certainly a possibility, assuming that the need for job attraction remains.
§ Mr. Bernard Conlan (Gateshead, East)If a development agency is good for Scotland and for Wales, why is it not good for the north of England?
§ Sir George YoungIf we went down that road, we would come under immediate pressure from colleagues who represent other parts of England to set up comparable bodies for their regions. At the end of the day, I am sure that it would not be an advantage to the north if there were a series of rival bodies in other parts of England carrying out a similar job.
However, assuming that the need for job attraction remains, the question of whether this role can be performed adequately by other bodies already in existence deserves closer examination, and it is an important area for us to consider in our review. I accept also that the review should be carried out by the end of this financial year before the corporation has slimmed down to a point of no return.
I realise that this is not the note of certainty that hon. Members have sought but it gives a definite time scale to the decision-making process. I hope that the hon. Member for Easington and others find this helpful. At the end of the review we shall be in a better position to decide whether the date should be postponed again.
Question put and agreed to.
Adjourned accordingly at five minutes to Twelve o' clock.