HC Deb 17 July 1997 vol 298 cc585-92

Motion made, and Question proposed, That this House do now adjourn.—[Mr. McAvoy]

Mr. Deputy Speaker (Sir Alan Haselhurst)

Will hon. Members please leave the Chamber as quickly as possible, in fairness to the hon. Member who has the Adjournment?

7.20 pm
Dr. Stephen Ladyman (South Thanet)

Thank you, Mr. Deputy Speaker. I am also grateful to Madam Speaker for selecting this topic and giving me the opportunity to bring some of the problems facing Thanet to the attention of the House. I regard it as a great honour to have secured this debate.

I have made my home in Thanet, having lived there for six years even before I became its Member of Parliament. It is one of the few places in which I have found the same warmth of welcome as on my native Merseyside. It is a great honour for me to represent the people of the area and to present some of their problems to the House.

There is a great deal of misapprehension about Thanet. Because it is in the south-east, it is sometimes mistakenly thought of as a prosperous area. Indeed, only this week, my right hon. Friend the Secretary of State for Health referred in a television interview to "the prosperous south-east". That rather innocuous remark upset many of my constituents, who are far from prosperous.

I happen to know that my right hon. Friend knows Thanet well—he even visited me during the general election campaign—and I am certain that he intended to say, "the prosperous parts of the south-east", but none the less his remarks added to a picture which suggests that Thanet is not really the problem area that we make it out to be.

I want to bring some of the facts to the attention of the House. There is considerable economic deprivation in Thanet, which leads directly to social deprivation. As it happens, only 80 per cent. of my constituency is in Thanet, the other 20 per cent. being in the Dover district, but Thanet's social deprivation is exported throughout the constituency, so everybody suffers from it.

In June this year, unemployment in Thanet was 10 per cent., down from 10.7 per cent. in May. One should compare that with unemployment in the south-east as a whole, at 3.7 per cent., and in Kent, at 5.4 per cent., and with the national average, at 5.6 per cent. Our unemployment is higher than that in Glasgow or on Merseyside.

The problem is even worse than those figures suggest, because Thanet has a large tourist industry and a large agricultural industry, so unemployment is depressed in the summer months as a result of seasonal work. The figures later in the year will show our unemployment to be as high as 14 per cent.

Eight of the wards in Thanet—large, three-member wards—are in Kent's top 50 for social deprivation. Some of the wards in my constituency have male unemployment as high as 60 per cent. There are 4,015 children in Thanet who receive free school meals. Despite above average A-level results, the number of students going on to further education is half the Kent average, as a result of the low wages in their households.

In Thanet, 51,852 homes lack the exclusive use of a bathroom; 70 per cent. of council tenants receive rent rebates; 30 per cent. of households include a council tax benefit claimant; and there are 900 empty business premises. The statistics go on and on. One, which I discovered only this week, really horrified me: 41 per cent. of the households in Thanet have a total income of less than £10,000 a year. To put that in perspective, Members of Parliament receive £12,000 a year just to cover our additional costs for having to live away from home for a few days a week. My constituents have to live on that money for the whole year.

Progress has been made; there is no question about that. The first step along the route to progress was that the European Union recognised our problems and granted us objective 2 status. That embarrassed the previous Government, who granted us assisted area with development area status. We have also managed to make some successful single regeneration budget and lottery bids, and further progress was made in May 1995, when the good people of Thanet, for the first time, overwhelmingly returned a Labour council.

That council has begun the business of transforming Thanet. It first transformed its financial management, and I shall come to the significance of that later. We built a superb regeneration and economic development unit in the council. The overriding aim of our manifesto was to create jobs. In that endeavour, we have received wonderful help over the past 12 months from the Government Office for the South East. When we first got objective 2 status, I do not think that GOSE or the then Conservative council knew how to exploit it. Since 1995, we have learnt together, and over the past 12 months, the office has come up trumps.

The council has transformed itself into what we call a quasi-local development agency. Now it can start to attract inward investment. The council created two business parks. One, which was entirely in private hands, was created by threatening compulsory purchase, although we were willing enough to work with the developer to make progress.

The council also purchased 10 acres of land from its meagre resources to build a second business park, known as Thanet Reach. The two parks are now built, serviced and ready for jobs; Kent international business park has already attracted an investment from the Cummins group, and the building of its factory has been started, which is good news indeed.

We have attracted some other major investments. Holyman-Sally is to invest £85 million in catamarans, to run from Ramsgate; Dreamland Ltd. has started to refurbish the fairground at Margate and to construct, in an adventurous arrangement with the local council that will lead to the renovation of a large area of Ramsgate, a designer outlet called Ramsgate Boulevard, which we hope will attract thousands of people to the town.

I want to say a little more about the governance of regeneration. Although the economic development unit and the efforts of GOSE have been a step forward, we have been less successful in some other areas. There has been little democratic membership of the regeneration partnership, at the direct instructions of the previous Government. We fought long and hard, and now we have eventually been allowed to put some councillors on that partnership. The council would also like the local Member of the European Parliament to be on it. I hope that the Government will one day make it clear that they will allow him to be on the partnership.

Some of our endeavours suffer from a lack of support from some of the quangos that should be helping us. English Partnerships has always talked a good fight, but backed away from it at the last moment. For the first few years of its life, East Kent Initiative seemed more interested in the channel tunnel than in Thanet, and for the past few years it seems to have been misdirected and looking for a mission in life. Now, it merely stands between us and inward investors. A new organisation, Locate in Kent, has been set up. I hope that the regeneration unit of the local council will be able to deal directly with that organisation. It can attract the inward investors, and the council can then turn that contact into real development.

I met the chief executive of Locate in Kent yesterday. It was a helpful meeting and I was encouraged by what he said. He gave me his corporate brochure, which I read before making this speech, and I was horrified to see that it does not mention the Thanet Reach business park or include one of the major roads into Ramsgate, which I do not find encouraging. If Locate in Kent does not tell the whole story about Thanet, who will? I hope that he will put that right.

I welcome the Government's proposals for regional development agencies, but I hope that the Minister will ensure that when they are set up, they report to a Minister, that they have full democratic control and that the regeneration unit of Thanet council will be able to work directly with them. I also ask that we work out what the council and the regional development agency should each do and ensure that they do not stand on each other's toes and duplicate effort.

We have some serious infrastructure problems, which need to be tackled. I shall take the House on a quick drive into Thanet. The A299 is being dualled, which is a step forward, but the dualling terminates on the A253, so there is no dual carriageway into Ramsgate. Furthermore, someone driving a 40-tonne lorry into our port has to go through the heritage town and round a hairpin bend—in fact, there are two sharp bends—which was intended for the horses and carts of Wellington's army, not a 40-tonne articulated truck. The Ramsgate harbour approach road is badly needed. The tragedy is that it is fully funded, it had been through all its planning processes and the archaeological work had started, when the new Conservative county council, elected on 1 May, decided to put the project on hold. All that the county council has succeeded in doing is to worry our inward investors. I ask the Government to do whatever they can to give the county council a kick up the pants and tell it to get on with building that road.

When one comes into Ramsgate and turns right on the A256, one leaves Thanet, but quickly comes to the jewel in our local crown—it is also one of the jewels in the United Kingdom crown. Pfizer is a pharmaceutical and animal health company—the largest animal health company in the world and the fastest-growing human medicine company. It is the fastest growing because it has the most successful research organisation, and the most successful component of that research division is in Sandwich. Several thousand people work there and another thousand will work there in five years, but not unless we upgrade the roads to the Pfizer site.

The company has already decided to move 300 jobs to the M25 corridor. That will be the thin end of the wedge, unless we give it the infrastructure improvements that it needs.

If one turns left from the A253 on to the A256, one can see that we also need to improve the road to Thanet Reach. We also desperately need a decent rail link. I call upon the Government to work with Railtrack to build a fast link from Thanet to Ashford, to join the high-speed rail link to London. The joke is that Pfizer came to my constituency in the mid-1950s because of the high-speed rail link that existed then. Unfortunately, it is the same high-speed link now, only a good deal dirtier and less well kept.

Grants are important if we are to attract inward investment, but inward investors tell us that they are typically offered £16,000 a job to invest in Thanet, whereas they can get £30,000 a job to invest in Wales. I realise that there will be some dispute over those figures. The Minister may even challenge them, but that is what inward investors are telling us, so either the figures are correct or their perception is wrong. We need to deal with the problem, whichever it is.

We need quality jobs with decent rates of pay. I was horrified to find out that GOSE offered someone a lower grant than he ought to have had because it thought that he would pay too much. He wanted a trained and motivated work force. GOSE thought that he should have a low-paid work force. That was some time ago. I hope that GOSE does not have that attitude now, and I call on the Minister to confirm that it does not.

Council finance is another important element. Because of our large housing benefit problem—we pay out about £40 million in housing benefit to low-paid people and suffer from what is sometimes called dole by the sea—the net cost to the council is £3 million a year. That £3 million, which the Secretary of State of the time said would not fall on councils, comes out of the general fund budget of only £15 million. If we had that money, we could spend it on local business, small businesses and tourism. As we do not have it, those businesses suffer. I call on the Government to keep a promise made by the previous Government, who said that they were going to deal with that problem.

This week, we heard that RAF Manston is to close. I should be pleased if the Minister responsible was prepared to meet me and others from Thanet to discuss the transition to private use. The closure will upset many people in Thanet—they remember Manston when it was the front line of the battle of Britain, so they have a sentimental attachment to it. If it has no military use now, we could at least make it into a private, specialised airfield, which could create thousands of jobs.

I must briefly mention health care, because East Kent health authority has today launched a review of health care throughout east Kent. I was disappointed with a written answer that I received tonight from the Department of Health, which tells me that clinical need will be "a major component" of the priorities considered by that review. It ought to be the primary component. I call on the Minister to say so.

In conclusion, we have had lots of bad news in Thanet recently, even since the general election. The county council has attacked the harbour approach road, the Ministry of Defence has closed down RAF Manston and the local health trust has decided that it wants to close Ramsgate hospital. Now is the Minister's opportunity to give me some good news. If she cannot do so tonight, let her at least tell me that the Government are committed to reviewing those issues and that some time during the next five years I shall have action on them to take back to the good people of Thanet, who desperately need the Government's help.

7.36 pm
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Angela Eagle)

I congratulate my hon. Friend the Member for South Thanet (Dr. Ladyman) on his success in achieving this Adjournment debate and on his election success. I visited his constituency a couple of years ago to look into some employment issues with the local employment service as a member of the Select Committee on Education and Employment. I remember thinking that his constituency was very like mine—Wallasey—and wondering why it had a Conservative Member of Parliament. At the election, he put that right.

Thanet gained European Union objective 2 status in 1994, reflecting the economic decline that the area has suffered in recent years—a decline that my hon. Friend highlighted well. Objective 2 programmes tend to be of three-year duration. The first ended in 1996 and involved about £11 million of grant aid. The new programme started from January and will mean another £14 million of grant aid to support a range of local initiatives. My hon. Friend's point about the high levels of unemployment was well taken—my constituency suffers similar levels. To date, Thanet has received £13.6 million in regional selective assistance, with further investment of £85 million levered in as a result of the grants, to create more than 1,800 jobs. In addition, £9 million spread over five years was allocated to the Thanet Regeneration Partnership in 1995–96 under round 1 of the single regeneration budget and a range of projects are already under way and achieving results. The partnership also submitted a bid under round 3 and secured a further award of just under £6 million.

Thanet also benefits from European funding under the INTERREG Community initiative, which includes two initiatives that will spend £3.2 million in Thanet alone. Taken together, those grants represent a substantial commitment to Thanet by the Government and the European Union and they reflect confidence in Thanet's ability to deliver results.

Since coming to power, the Government have spelt out the new approach that we want to bring to regeneration. We do not regard regeneration as being only about schemes and projects or bricks and mortar; it is also about social regeneration—people are as important as buildings. In our approach to round 4 of the single regeneration budget, we have spelt out our concern to attack the causes of social and economic decline and exclusion and to tackle the needs of deprived communities. That means collaboration and partnership at local level.

We want an integrated approach, and we have started at the top with the new Department of the Environment, Transport and the Regions. We also want integration at regional level. My hon. Friend mentioned bodies in the south-east such as East Kent Initiative and Locate in Kent. National bodies such as English Partnerships also have a role to play in the region. I sympathise with my hon. Friend because more than 40 such organisations are operating in Merseyside. I am certain that a more integrated approach would bring real benefits and avoid some of the duplication and confusion that has arisen from current arrangements. That is where our proposals for regional development agencies come in.

I am pleased that my hon. Friend supports the move to regional development agencies. The Government regard them as an essential first step to effective, co-ordinated, strategic regional economic development that will enable the English regions to improve their competitiveness. One of our important jobs will be to bring together the various regional organisations and help them work together to ensure that the regions gain the greatest possible benefit from their efforts.

Ministers are still considering what arrangements are appropriate to the specific needs of each region. That is why the Government Offices in all regions are carrying out a national consultation exercise to ensure that Ministers have access to as wide a range of views about future structures as possible. Local authorities are included in the process and I am sure that they will make a valuable contribution to the development of that policy. I look forward to Thanet district council's contribution. A consultation event, one of a series organised by the Government Office for the South East, takes place in Kent next week. The opinions expressed then will be weighed carefully.

My hon. Friend mentioned the membership of the monitoring committee that steers and oversees Thanet's objective 2 European funding. The approach taken by the Government Office for the South East reflects current Government policy. However, those of us who represent constituencies that receive European Union structural funds are only too well aware of the frustrations that some of these arrangements have created. It is a question of balancing proper monitoring with efficiency and accountability, a balance with which Government Offices continue to wrestle. The arrangements are set out in the single programme document and the European Union expects them to be fulfilled.

I am aware that the Member of the European Parliament for Kent, East has written to my hon. Friend the Minister for the Regions, Regeneration and Planning raising his possible membership of the monitoring committee. Of course Members of the European Parliament have a legitimate interest in the way in which programmes are implemented. I am aware of the views of several of them on the matter, which I shall take up with colleagues.

I should also like to take this opportunity to assure my hon. Friend that the Government Office for the South East is working actively and closely with Thanet district council and local partners to ensure that the forthcoming 1997 to 1999 phase of the objective 2 programme delivers maximum benefit for the regeneration of the area.

The Ramsgate harbour approach road is part of the pilot capital challenge scheme announced last year by the previous Government. Kent county council was successful in securing credit approval worth more than £25.9 million over three years to build the road. More than a third of the allocation available for the whole south-east region has been set aside for that one scheme. As my hon. Friend knows, the scheme seeks to provide a new link between the strategic road network and Ramsgate harbour and is regarded as a major catalyst in the diversification of Ramsgate port, creating environmental benefits for the town while aiding the economic regeneration of the Thanet area.

It is therefore surprising that Kent county council is holding up the scheme that it championed so effectively when it made the bid. The county council changed hands when the Conservatives took control at the last election. It is reviewing the system of road schemes in its area. I hope that it comes to a conclusion quickly but I note that my hon. Friend's predecessor, Jonathan Aitken, said: Our town of Ramsgate needs and deserves this road. In the same debate, he was supported in his plea by the hon. Member for North Thanet (Mr. Gale), who said: I endorse his arguments utterly and whole-heartedly."—[Official Report, 4 December 1996; Vol. 286, c. 1181.] I sincerely hope that whatever its decision, Kent county council will get on with it and remove the uncertainty.

By far the largest road building scheme being funded in Kent is the A299–A253 extension, which is the Isle of Thanet's link to the M2 and the strategic road network. My Department is funding Kent county council's scheme to upgrade the road to dual carriageway standard with grade-separated junctions at a total estimated cost of more than £170 million. There are no short-term plans to improve the A253 between Prospect Inn and Lord of the Manor. It is for Kent county council as the local highway authority to develop proposals for that section of the road and bid for funding of the scheme in the usual way.

From a local transport point of view, Kent has done extremely well in recent settlements, taking more than 10 per cent. of national resources. In 1997–98, it will receive £77.3 million in financial support. In a year when the financial constraints bit hard, that compares well with the previous year's figure of £81.6 million.

I note my hon. Friend's comments about rail services in Thanet. The area is served by three trains per hour from London, provided by Connex South Eastern. As he said, the journey time is about one hour 45 minutes. I understand that that will be reduced when the channel tunnel rail link comes into operation. He mentioned a fast connection via Ashford. The Stour Valley line between Thanet and Ashford via Canterbury has been identified as needing upgrading to become a strategic link between Thanet and London linking into the channel tunnel rail link at Ashford. I am sure that he will be watching for progress.

The franchising director has powers to support and encourage investment in new railway services. He has developed criteria for appraising proposals to support new services that offer wide public benefit but may not be viable on a purely commercial basis. He has made recommendations on that criterion that Ministers are considering, but it will be for potential operators of new services to approach him with their proposals.

On attracting quality jobs, I strongly agree with my hon. Friend that casualised or low-paid jobs are not the answer to creating proper, sensibly based regeneration. I am pleased that he supports the Government's intention to legislate for a national minimum wage. I am not aware of the case that he described where an applicant for regional selective assistance apparently received less grant because the previous Government thought that the wages that he was paying were too high. Conservative Members were boasting only yesterday in another Adjournment debate about how low agricultural wages were. They never seem to learn. Rest assured, this Government do not share those opinions.

My hon. Friend also asked about RAF Manston. Naturally, Government Office for the South East officials wish to maintain a close working relationship with local partners to monitor developments with regard to the future of RAF Manston and to evaluate how the site may be used to assist in Thanet's economic regeneration. In view of the announcement earlier this week by the Ministry of Defence on the proposed withdrawal of the RAF from Manston, the Government and local partners are examining the potential civil development of the site with renewed urgency. However he will appreciate that at this stage I am not in a position to be more definite.

The administration of housing benefit is a matter for the Department of Social Security, but I will pass on my hon. Friend's observations. As he knows, 95 per cent. of private sector housing benefit expenditure by authorities is returned direct to them. The remaining 5 per cent. is fed into authorities' general funds through the revenue support grant mechanism. An additional 0.5 per cent. is fed into the general fund in recognition of authorities' expenditure in what are known as incentive areas, where they stand most chance of controlling their administrative expenditure through their own efficiency.

I understand that in some circumstances an authority may lose out, for example when a rent determined by the rent officer is lower than the actual rent that the authority is required to meet. However, changes to the housing benefit rules in 1996 have reduced that problem and a discretionary lump sum is available from the Department for Social Security to meet extra cases of hardship.

I am aware that the council made representations to my Department through the then sponsor Minister for the south coast at the end of last year. The council wanted the capping regime amended so that its expenditure on housing benefit would be disregarded. The previous Government refused to do that and my hon. Friend will not expect me to give a commitment on such a complex issue tonight. The funding regime for 1997–98 is now fixed, but it will be open to Thanet to make representations for next year at the appropriate time.

This has been a wide-ranging debate. Indeed, my hon. Friend set me a formidable task of trying to answer the many questions that he asked. I am sure that I have not dealt with all of them, but he has left the Government in no doubt about the needs of his area. He is already proving that he is a doughty fighter for his constituents. Some of the issues that he brought up tonight are already being addressed and local partnerships and individual members of the community deserve much credit. There is still much to do, and my hon. Friend has illustrated the wide range of departments and agencies with responsibilities in the area. The challenge now faced by Thanet and its partnerships is to use all the resources available to secure a successful future for their people.

Question put and agreed to.

Adjourned accordingly at ten minutes to Eight o'clock.