§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Bates.]
10.16 pm§ Mr. Den Dover (Chorley)It gives me great pleasure to highlight the need for an enterprise zone at Royal Ordnance, Chorley.
In the past 17 years, this Conservative Government have displayed a tremendous vision for the enterprise economy, which has shown itself in our economic performance, particularly in the past two years. Those Government policies have comprised the creation of urban development corporations and enterprise zones. They have ensured that new ideas have flourished and new enterprises have been set up around the country. We have prime examples of that success in the Metro centre in the north-east, by Newcastle, and the Merry Hill centre in the west midlands. I venture to suggest that there would have been nowhere near that investment and retail expansion in those areas without enterprise zones.
Similarly, just 20 miles from Chorley, the Central Manchester development corporation has revitalised huge areas of what was a decaying city, and the Trafford Park development corporation has done a marvellous job on a clapped-out old industrial park.
In the past two years, I have raised the need for an enterprise zone on a number of occasions—first with the Prime Minister, whose answer on 22 February was interesting. On that occasion, I said that I welcomed the latest plans for enterprise zones to be established in areas where coal mining was running down and labour opportunities were diminishing, and I called for those zones in areas such as Chorley.
The Prime Minister recognised that enterprise zones had been successful, and said:
In areas that face particular difficulties because of substantial job losses, perhaps because of the collapse of a single employer or industry, we look across the board to see what help can be given. Enterprise zones are an important part of that, but not necessarily the whole of it."—[Official Report, 22 February 1994; Vol. 238, c. 143.]The basis of tonight's debate is to examine the various alternatives open for the regeneration of the Royal Ordnance site at Chorley, which has suffered massive job losses.The owner of the site, Royal Ordnance, is a wholly owned subsidiary of British Aerospace, which is a first-class employer in the defence industry throughout the north-west and the rest of the country.
The whole 900-acre site is contaminated by munitions. It was used for the filling of shells and all sorts of bombs and other ammunition for many years. Three quarters of the site is in Chorley borough council and one quarter in South Ribble borough council. I welcome the presence of my right hon. Friend the Member for South Ribble (Mr. Atkins), who wants to add a few comments at the end of my speech.
The site has always had direct rail access. It is directly between the M6 and M61 motorways, so, while it needs decontamination and much infrastructure, it is a strategic site that would have first-class communications.
Since the war, when there were 30,000 munitions workers on the site, there has been a dramatic fall in the amount of labour employed. It was down to 6,000 or 7,000 1082 about 20 years ago, and there are now only 100 production workers. We have the headquarters of Royal Ordnance, and I welcome the fact that there are 350 white-collar workers on the site. They are located on the southern perimeter, on one of the roads.
Enterprise zones have been designated in the past few years in Nottinghamshire, Yorkshire and Durham. I am anxious, because of the peace dividend and the rundown of defence jobs, to fight the cause for enterprise zones in areas that have suffered from the dramatic fall in the number of defence jobs. That affects not only Chorley and the north-west but the whole country.
The advantages of enterprise zones are tremendous. There is a 10-year period without business rates and 100 per cent. capital allowance for people investing in the area; and they are basically planning-free zones, unless the use of toxic chemicals is involved. People generally have a free hand.
The sort of development that I, Royal Ordnance and my right hon. Friend the Member for South Ribble would like would involve mixed uses. We want a reasonable amount of residential development, but of the right sort—for buyers from our area, not for incomers. We want a business park that would include manufacturing, light industry and offices. It would have some retail content, but the main aim is not a retail investment such as the Metro Centre or Merry Hill.
I am delighted that my hon. Friend the Minister for Small Business, Industry and Energy has played a part in ensuring that we get Konver funding from Europe. That ensures that we can change from defence manufacture towards civil production, and get a commercial business centre started. So far, it has been only small fry. That is why we need the massive injection that we would get from an enterprise zone.
What are the alternatives to an enterprise zone? In our area, unemployment is below 5 per cent., and we have no chance of getting assisted area status. We would need an unemployment rate of 15 or 18 per cent. or even higher. I welcome the fact that we do not have that. I like to think that much of that results from my efforts and those of other Conservative Members in the area, who have kept unemployment in Lancashire lower than in the rest of the region or the nation.
We have put in single regeneration budget bids in the first two rounds. The Government office in Manchester gave us a no-no in each case. I am not hopeful about rounds three and four, and there will be less money available in the rounds to come.
English Partnerships has been helpful, but it has been charged with redeveloping brown-field sites throughout the United Kingdom. It has a massive task, which will need not hundreds of millions, but billions, of pounds to redevelop all available sites. It is spoilt for choice, but it has been very helpful. Some investigations are going on at the moment, and I applaud it for playing its part. Frankly, this site will not be developed for decades unless we have a designated enterprise zone.
I have already paid tribute to Trafford Park and Central Manchester. They have done wonders in the north-west. Royal Ordnance has put in for planning permission on a mixed-use basis, and it hopes that the two local authorities will play their part so that it can do full viability studies. I am not hopeful that we can see our way ahead. 1083 Two years ago, I led a deputation from the two local authorities to meet the then Minister, who is now my right hon. Friend the Secretary of State for Transport. He made constructive comments, but said two things. First, he said that it was not necessarily the right way ahead, and that we must examine all possible alternatives. The Minister had been advised by his civil servants that there was little or no chance of securing European Union approval.
Following the deputation, on 18 April my right hon. Friend wrote a letter in which he said:
I promised to write to clarify the European Union position regarding the designation of Enterprise Zones. My officials have spoken with our representative in Brussels (UKREP) who confirm that the Commission's position remains that Enterprise Zones are extremely unlikely to be approved if located outside Assisted Areas. Of course, under the Treaty of Rome, the UK is able to notify the Commission of a proposal to designate a zone outside an Assisted Area, but the unambiguous advice from Brussels is that the Commission will reject any such proposal".We have only to look at the events of the past week to see that the Commission always wants its own way.My right hon. Friend the Member for South Ribble and I are here this evening to champion the cause of an enterprise zone. Article 92, section 3 of the treaty of Rome, under the heading "Aids Granted by States", says:
The following may be considered to be compatible with the common market:(b) aid to promote the execution of an important project of common European interest or to remedy a serious disturbance in the economy of a Member State".That article could be applied to defence industries, not only in this country but in other member states. A submission could be made, and the European Union would then make a decision—and I would fight it all the way.I ask that Royal Ordnance, as the landowner, and the two local authorities, which support the concept of an enterprise zone, be allowed to fill in the necessary forms and make out their case. We could then examine that and other alternatives to see what may be done.
I raised the matter in the Environment Select Committee hearing of 19 July 1995 with my hon. Friend the Member for Skipton and Ripon (Mr. Curry). In answer to my query about the possibility of a designated enterprise zone within the European Union, he replied:
There are really two aspects to this. The first is, does the European Union allow it; the answer is yes but the conditions are very severe and it takes an interminable time to deliver one … it is because there are a great deal of conditions to fulfil, there are activities which have got to be excluded from an enterprise zone and there are contracts which have got to be signed with umpteen people in order to deliver them. With the best will in the world, we are talking about years, not months, to get an enterprise zone from zero to operation. So that is the first answer. The second answer is there is a real issue about whether enterprise zones are the most effective answer; whether or not they do, to some extent, divert investment, while in this long period of getting it up and running whether, in fact, investment is deferred as well as distorted. So I have to tell you that my own view is that I do not say 'I never want to see another enterprise zone', but I would want to make sure I had explored every other avenue before I would say that an enterprise zone seemed to me the right route to go down.I argue that it is the right route and that we should have the chance to bid for it. I am convinced that the process will take years, but the site has lain stagnant for 10 or 20 years, and something must be done: the blot on the landscape must be removed. I am sure that many jobs can be attracted to the area, and I look forward to being allowed to pursue the case for an enterprise zone.
§ Mr. Robert Atkins (South Ribble)I am grateful to my hon. Friend the Member for Chorley (Mr. Dover) for allowing me to make a brief contribution to the debate. He has laboured long and hard—as long as he has been a Member of Parliament—to have the site's importance recognised. We had hoped that the British Aerospace takeover of Royal Ordnance would ensure the continuation of employment on the site, but that was not to be.
As my hon. Friend said, it is a substantial site, of which a small proportion is in my constituency. I have followed my hon. Friend's lead in going from pillar to post in putting the case for an enterprise zone. I was an Environment Minister when my hon. Friend led a delegation to meet Department of the Environment officials, and he understood that I was not able to be present on that occasion.
My hon. Friend the Minister will recall our travails in Committee when considering the Environment Agency legislation. We examined the problems of contaminated land and what could be done to retrieve such sites into the development cycle. This is a case in point: we are looking to attract industry to that substantial site and to create jobs.
While the South Ribble borough council and Chorley have some differences about a number of suitable sites in the area, this site could be used to create jobs and attract industry—particularly high-tech industry, which would help to recover some of the costs associated with remediating the contaminated land.
It would not be acceptable to house residents from, say, Preston on the site—as is being proposed by the county council and by others. We want to see a mixed development of industry—predominantly in a nice high-technology environment—on the site. If housing or recreational facilities could be put on the site as well, so be it. In essence, we are looking for industry and we are looking for jobs.
I ask the Under-Secretary of State for the Environment to do what he can to meet the concerns of my hon. Friend, who is pressing for enterprise zone status—and I have joined him in supporting the principle of wanting more industry on the site. I ask him to give an undertaking this evening to review the options and to consider what might be done in the best interests of Chorely and South Ribble. Having done that carefully, he could then advise us what can be done along the lines that we have been pressing.
§ The Parliamentary Under-Secretary of State for the Environment (Sir Paul Beresford)I am grateful to my hon. Friend the Member for Chorley (Mr. Dover) and to his right hon. assistant the Member for South Ribble (Mr. Atkins) for raising the issues surrounding the site. It is interesting and fascinating. Both my right hon. Friend and my hon. Friend have been battling with this issue, with much energy, for a considerable time. I agree that we need to make every effort in this area, and in other areas like it, and use such sites productively. I applaud the point made by my right hon. Friend about the productive use of the site.
However, we have to accept that there is a scale to the task which means that it will inevitably have to have a slower track than has been followed in some other cases. 1085 As my hon. Friend has demonstrated, the Royal Ordnance site is complex and difficult: there are some 1,500 buildings of various types, roads, distribution areas, open spaces, test areas and dumping grounds. Hon. Members will appreciate that a site of this size—some 300 hectares: from my back of the envelope mathematics, approximately a square mile—is not only large but diverse. Therefore, there is not one single approach or means of tackling it.
I believe that an enterprise zone on such a complex site would be counter-productive—the area does not have high unemployment relative to some other areas. An enterprise zone, and an enterprise zone alone, would, to my mind, stifle investment in the area—while everyone in the industry waited to see whether it came forward, and while we tried to explain to Brussels why we should have such a site. It is quite clear from the answer that my hon. Friend has received that it is unlikely that we will obtain such permission.
In the early 1980s, a number of sites were designated as enterprise zones on an experimental basis, and they had a relatively high cost compared to some of the other methods. In December 1987, we announced that the enterprise zone scheme would not be extended unless there were exceptional circumstances—as was the case with the eight enterprise zones designated since that time. Each one was in response to a sudden major impact on industry caused by a closure of a traditional heavy industry—shipbuilding, steel making or coal mining. I concede that there is a parallel that one could make in this area from the Royal Ordnance.
This area of Chorley does not have a poor economy. In fact, it has a vibrant and wider economy—which would considerably complicate matters when we tried to get permission from Brussels. As my hon. Friend said, it has been made clear that a new enterprise zone, located outside an assisted area, would be resisted—to put it mildly.
I have, as my right hon. and hon. Friends know, asked the officials in the Department to work closely with the local authorities, and particularly with English Partnerships, to consider a range of options available for tackling the site.
As my hon. Friend the Member for Chorley knows, English Partnerships has recognised the site's economic potential and significance. Substantial work has been done already to investigate the potential of the Royal Ordnance site, targeted specifically at prospects for its redevelopment and rejuvenation.
My right hon. and hon. Friends will be aware of the study carried out by the consultants at the end of 1994. That aimed to formulate a strategic framework for the complementary regeneration of several major brown-field sites in the area, including the Royal Ordnance site at Euxton. Its conclusion was that this was a flagship site of significant potential for a major role in the regeneration and economic growth of the region.
My hon. Friend the Member for Chorley may also know that, in December 1993, under the Konver I Community initiative, a grant of £446,400 was awarded to Chorley business and technology centre towards a project at the Royal Ordnance factory site. The grant covered four elements—preparatory work for a future 1086 scheme; surveys of the 60 hectares; a feasibility study for a soil bio-remediation centre; and creation of a manufacturing facility. I understand that the organisation has successfully provided workshop space on the Royal Ordnance site to assist small companies in need of new premises.
More recently, a working group has been set up to bring together the key local players, especially representatives from the two borough councils with a shared interest in the site. The site straddles the boundary between the two borough councils, Chorley and South Ribble, as has been explained. My hon. Friend the Member for Chorley will be aware of the two local plans for these, which propose a mixture of housing and employment areas and open spaces.
Based on those local plans, as they stand, the split is likely to be in the region of 10 per cent. for housing, 50 per cent. for employment and 40 per cent. for open space. That remains to be confirmed, as the local plans are still being debated, but I am sure that those provisional splits will go some way to reassuring my hon. Friend, and particularly my right hon. Friend the Member for South Ribble, that careful consideration is being given to achieving a balanced mix of uses.
My hon. Friend the Member for Chorley may be aware that an investigation of the site and building conditions has been undertaken in two phases, predominantly because of the size and the costs involved. The first phase, covering an area of 82 hectares, has been completed at a cost of £250,000, partially met by Konver assistance. The second phase, which is currently under way, will cost around £470,000. Again, part is to be met by Konver II, part by Royal Ordnance, and English Partnerships has agreed to contribute £118,000. That is substantial support, helping to speed up the process.
The important work is due to be completed by summer this year. English Partnerships and Royal Ordnance are in agreement that further progress is dependent on the findings and the recommendations. That is a sensible way forward. Once the site report is available, it will be possible for the various bodies involved to work out in more detail the joint approach. As I have said, there are more than 300 hectares to attack, and it is realistic to plan for phases over a number of years. There can be no quick fixes on a site as complex and as large as this.
Much is currently going on behind the scenes. Neither the private nor the public sector will invest in the site until we have a clear idea of what needs to be done to clean and clear the area. My right hon. Friend the Member for South Ribble will understand that, having piloted the Environment Act 1995 through some of its stages, predominantly its Committee stage.
I should like to suggest an alternative approach to my hon. Friend the Member for Chorley, who may wish to take it up with the local authorities. A part of the Royal Ordnance site could be designated as a simplified planning zone. That would have the effect of granting full planning permission for specified types of development, in advance of the precise development proposal being worked up. My hon. Friend may be aware that that is similar to the simplified planning procedures which operate within an enterprise zone, without all the long-drawn-out procedures.
The kinds of developments concerned, together with any conditions or limitations attached to them, are set out in the scheme which lasts for 10 years once adopted. 1087 Developers are able to act in the knowledge that development specified in the scheme will be permitted, so they can go ahead without needing to go through the performance of a planning application. That removes one of the more bureaucratic drags on development that some local authorities impose.
To conclude, I must say that I am very impressed by the painstaking approach taken towards the planned development of the Royal Ordnance factory site. My hon. Friend the Member for Chorley will agree that our 1088 resources need to be used wisely, and that we need to ensure that we obtain the outcome we wish to see, and that we get a clean and attractive site as promptly as reasonably possible. That is why I think that the procedure we are adopting now is preferable to the long-drawn-out, somewhat hazardous approach of an enterprise zone, which my hon. Friend has suggested.
§ Question put and agreed to.
§ Adjourned accordingly at twenty minutes to Eleven o'clock.