§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Robert Ainsworth.]
§ 11.2 pm
§ Sir David Madel (South-West Bedfordshire)
I am grateful for this debate, and I welcome to the Front Bench for the first time the Under-Secretary of State for Trade and Industry, the hon. Member for Hornsey and Wood Green (Mrs. Roche). I congratulate the hon. Lady on her appointment.
The object of the debate is to put to the House the industrial situation in Dunstable, and to explain why help is needed. [Interruption.]
§ Mr. Deputy Speaker (Mr. Michael J. Martin)
Order. Perhaps hon. Members would leave the Chamber quietly while an hon. Member is addressing the House.
§ Sir David Madel
Thank you, Mr. Deputy Speaker.
It is 21 years since an earlier Labour Government helped us in Dunstable by the rescue of Chrysler Trucks. The late Harold Lever and the right hon. Member for Manchester, Gorton (Mr. Kaufman), who was then Minister of State, Department of Trade and Industry, came in with a rescue package to save, for a time, 3,500 jobs in Dunstable.
We have moved a long way from then. The economy in south Bedfordshire has somewhat improved, and local unemployment rates have dropped. However, there are still three major causes of concern in the Dunstable and Houghton Regis area, which is why I sought this Adjournment debate tonight. Those are, first, the decline of traditional industries; secondly, the impact of traffic congestion on local industrial performance; and, thirdly, the future of the site of AWD Bedford Trucks, which, alas, no longer makes trucks.
On the decline of traditional industries, we were struck yet another blow during the election campaign in the middle of April, when the De La Rue printing company, with no warning whatever, announced that it was pulling out of Dunstable, with a loss of 400 jobs. That follows the closure of Cross Paperware last year, and of several other companies in the past few years. Thus, yet another major traditional Dunstable industry—printing—will go.
Another local industry that has disappeared in the past few years is the truck manufacturing industry. Dunstable once had two truck manufacturers: the world-famous Bedford Trucks, and Renault Trucks. After years of decline, a recession and the refusal by the Foreign Office in the previous Conservative Government to allow an export licence for AWD Bedford to sell civilian lorries to Libya—the Department of Trade and Industry and my then right hon. Friend, Mr. Richard Needham, wanted to grant an export licence, but the Foreign Office blocked it—the company collapsed.
Automotive components manufacturing remains a major local employer, providing some 3,000 jobs in the constituency, but those jobs are constantly challenged as manufacturers face increased competition caused by globalisation. Manufacturers in my constituency are not entitled to major grants under the current Government and European grant regimes. Indeed, those regimes discriminate against companies in the locality.
622 When major international companies start to reconsider their future investment strategy, grants can tempt investment away from our area. TRW Cam Gears recently invested in south Wales rather than Dunstable, for that very reason. At that time, the unemployment rate in south Wales was lower than in the Dunstable-Luton conurbation, although the latter is not recognised officially, because of the travel-to-work area problem.
Traffic congestion in Dunstable continues to worsen. The Bedfordshire chamber of commerce recently complained that its members in the Dunstable-Luton conurbation find it increasingly difficult to service customers west of Dunstable because of congestion. The main local industry—automotive components manufacturing—now uses a "just-in-time" system of product delivery. Local congestion threatens that system and the local jobs dependent on it.
Dunstable and Houghton Regis therefore need urgent new investment in the local road network. We still do not know the outcome of the A5 bypass conference held in Dunstable in the autumn. I do not criticise the Labour Government for that; I believe that they will soon be able to release the conference's conclusions. At that conference, representative after representative from industry in Dunstable warned of the danger of not solving our congestion problems. No case can be made for spending money and widening the M1 in Bedfordshire before something is done about Dunstable and Houghton Regis.
On infrastructure and public and private transport, I note the Labour Government's commitment to greater investment in and enthusiasm for the railways. I am glad to say that a parish poll in Dunstable last week—confined to Dunstable citizens—produced an 80 per cent. vote in favour of reopening our rail link.
The congestion problem was neatly summed up in a short letter in last week's Dunstable Gazette. It was headed:Back the bypass to attract new business.The letter states:The local and national elections have come at a very opportune time for those living and working in Dunstable. Tragically (particularly for those employed there and their families) De La Rue"—which, as I have mentioned, is going, with 400 job losses—yet another major employer, has left the town. There are few enough job opportunities locally and with the present communications (road and rail!) poor to say the least, it is more likely that further companies will leave rather than come to Dunstable. I fervently hope that those who have ended up representing the area will make it their mission to get us a bypass.The writer of that letter can have no doubt about my commitment to the bypass. It is a very important matter, and I cannot stress too strongly how important it is for industrial reasons.
The third major concern is the future of the AWD Bedford Trucks site. We have made progress. English Partnerships gave us a grant of —1 million, and without it we would not have Arensons, which is an office manufacturing equipment company. It is on site and building, and it goes into production in the autumn. It will be hugely welcomed, and will provide about 600 jobs for the town.
The Government have offered a KONVER grant of £750,000 towards the cost of redeveloping the AWD site. We obviously want to be able to use that money flexibly 623 within the development process to ensure that we get that industrial production, even if the development process is not exactly the same as originally envisaged in the grant application. In other words, we need maximum flexibility.
It is pertinent to ask the Government to tell us soon how English Partnerships will fit in with the regional development agencies that were proposed in the Queen's Speech. We await the White Paper with interest. I have no hesitation in saying that English Partnerships is popular in Dunstable. It has given us nearly £1 million and is well on the industrial map, and we greatly appreciate what it has done.
What can we do to take our industry forward and get our manufacturing employment back? We are all hoping that Vauxhall will launch the new Corsa in 1998–99 at the Luton plant. We hope that that will be confirmed. There would then be two cars being produced in Luton—the Vectra and the Corsa—employing hundreds from Dunstable and Houghton Regis. In every street in those two towns in my constituency, somebody knows somebody who works at Vauxhall at Luton. I hope that it will be possible for the Government to give Vauxhall some launch aid to get the Corsa into production.
If we get that, I will appeal to General Motors, as I have before, to give priority to former AWD Bedford Trucks workers when it is seeking new employees. We had a breakthrough last year with the Vauxhall-Renault van deal, which will bring 900 new jobs. I appealed to General Motors then to look first to Dunstable and Houghton Regis to try to take on former Bedford Trucks workers. If we can get the Corsa, I will ask General Motors to do that again.
We need assisted area status and a change in the grants and the European grants to give us a manufacturing boost. The Under-Secretary of State who is to reply to the debate is the hon. Member for Hornsey and Wood Green. In the Houghton Regis and Dunstable area, there are hundreds and hundreds of people who were moved out of London as part of the overspill programme, and probably some families came from Hornsey and Wood Green.
When those Londoners were moved out of London, they were moved because there were houses and there were jobs in our area. We did not operate a programme to move people out of London only for them to have to return to London to work. Therefore, houses and jobs were inextricably intertwined. What we have not yet got right is the jobs. My area has plenty of houses and housing developments, and there will be more to come, but we have neither manufacturing jobs nor the right infrastructure—road or rail—to support us.
I badgered the previous Government about those issues, and I shall, politely and gently, ask the brand new Labour Government, as they get their feet under the table, to see whether we cannot redraw the travel-to-work area boundaries to help us in the Dunstable and Houghton Regis area.
This month, in May, we saw the retirement of the former mayor of Dunstable, Councillor Reg Fossey. In his two years in office, he, with his wife Joan, gave great service to Dunstable, which has been hugely appreciated by everyone in the town. In his mayoralty, however, we have, as I said earlier in my speech, suffered some severe industrial setbacks, and we have seen shops close. Reg 624 Fossey, who has always been optimistic, has always urged the people of Dunstable to keep smiling, and Dunstable is trying its very best to keep smiling. We need help, however, to rebuild our manufacturing and a secure employment base.
As I said earlier, a previous Labour Government helped us, in 1976. It is early days for the new Government, but I appeal to Ministers to help us to rebuild a strong manufacturing employment base. Our area has everything going for it for manufacturers, such as good labour relations, which we have always had. With some public money spent on better roads and rail, our area would be hugely helped. We have a history of industrial stability and good will at the workplace.
I hope that the Government can give us not so much a handout as a hand up, so that we can return to the manufacturing orbit. I hope that they will be able to do that soon.
§ The Parliamentary Under-Secretary of State for Trade and Industry (Mrs. Barbara Roche)
I have listened with great interest to the speech of the hon. Member for South-West Bedfordshire (Sir D. Madel), and I congratulate him on securing this debate and on raising so many valuable points. I am also grateful for his kind words of welcome, and for the opportunity he has given me to outline some of the Government's plans to improve industry not only in the Dunstable area but across the United Kingdom.
To improve the competitiveness of British industry, we favour a collaborative approach, which builds on already existing partnerships. I am pleased that local and regional partners are actively working to regenerate the Luton-Dunstable area through a variety of measures, which I am sure are well known to the hon. Gentleman, who takes a very keen and detailed interest in such matters. I should particularly like to mention Bedfordshire county council, South Bedfordshire district council, Luton council, Bedfordshire training and enterprise council, English Partnerships—which he mentioned—and the Government office for eastern region.
Dunstable is typical of many regions in the UK that have, over the past two or three decades, undergone major structural change. In the 1970s, the economy was dominated by large manufacturing industry, and, in particular, by the automotive industry. In the 1980s, as the hon. Gentleman said, the area was hit by the closure of both the Bedford and Renault truck operations. The rundown of that sector has been compounded by the departure of other large businesses, such as Marks and Spencer distribution centre and Cross Paperware, and now by the imminent departure of Thomas De La Rue.
The hon. Member rightly expressed his concerns, which I completely understand, over the future of De La Rue. I understand that it is likely to close in July as part of a major restructuring of the group's security printing business. I know that the Bedfordshire TEC is in touch with De La Rue about the closure of its Dunstable plant, and has received assurances that, when the company puts proposals for redundancy to its employees this week, it will be seeking to identify individuals who arewilling and suitable to transfer to High Wycombe".Both the TEC and the Employment Service have now declared this to be a large-scale redundancy. The effect is to allow access to special assistance, which I hope will enable the people who lose their jobs to find new ones.
625 Local and regional organisations are already working hard to regenerate the area. I know that the Luton-Dunstable partnership is having a major impact with a £40 million regeneration programme which is expected to result in 4,000 jobs being created or safeguarded. The single regeneration budget is contributing £9.2 million, and that money has attracted additional funding from the private, voluntary and public sectors.
The partnership, which is private sector led, has already developed integrated regeneration schemes which provide employment and training, as well as improving the competitiveness of local companies. The partnership activities are also directed towards clearing and developing sites and improving transportation and town centres—issues that have been clearly identified by the hon. Gentleman.
Since the partnership started in 1995, the benefits have already become clear. More than 4,000 schoolchildren have been involved in the compact programme, which aims to create clubs in every secondary school to introduce children in our schools to the world of work. The programme in the Luton-Dunstable area also aims to improve the educational attainment of young people and to reduce truancy and vandalism. The partnership has already helped to establish 20 new businesses and nearly 150 people have found work. More than 11,000 people have been involved in community safety projects, and more than 100 voluntary organisations have been supported.
Other extremely valuable projects are also coming on stream. They include a technology innovation centre, which is being developed to support new high-tech companies.
The hon. Gentleman spoke eloquently of the skills of the local work force and the potential of the Dunstable area. I share his view. Certainly, the new Labour Government will move quickly to support our high-tech firms, which are essential if the Dunstable area and Britain are to succeed and become increasingly competitive.
Another area that I should like to touch on is inward investment. Until now, efforts to attract new investment to Bedfordshire and the other counties of the eastern region have been hampered because the region has not had its own inward investment agency. However, in April of this year the East of England Investment Agency was established. The agency is based on a strong partnership between the public and private sectors, and will be supported in its first year by a grant from the DTI of just over half a million pounds; there is also a significant contribution from the local authorities, TECs and the private sector.
The East of England Investment Agency will promote and develop the east of England as a world-class inward investment location very much along the lines mentioned by the hon. Gentleman—with all the structures in place in terms of the work force and commitment from the local agencies. The agency will be concerned with both attracting new investment and retaining existing investment by providing an after-care service.
The hon. Member mentioned the part that the automotive industry had traditionally played in the local economy. Although there have been closures, the industry continues to be a major employer in the area—notably at the Vauxhall plant in Luton and the neighbouring IBC 626 plant. However, the economy is becoming more diversified. Since 1991, the number of people employed by large companies in Luton and Dunstable has decreased substantially, while the number of people employed by smaller companies has increased.
The hon. Gentleman also mentioned the derelict land in the region. The greatest problem, as he rightly said, is the AWD site, formerly the Bedford Trucks plant. Not only is the site very large, but there are environmental hazards. A good start has been made on the expensive process of clearance and redevelopment, with the help of an £850,000 grant from English Partnerships. I was pleased to hear the hon. Gentleman's warm tribute to that.
I am delighted that President Office Furniture is moving to a new headquarters and factory building on the AWD site this summer. In addition to 280 people already employed in the company who will be relocating to Dunstable, a further 220 will be recruited locally—that is good news for the area. A second phase already planned will add a further 50 jobs.
I also welcome the fact that plans are well advanced for regeneration of the rest of the site. A £1.5 million finance package is now being put together, including £750,000 from KONVER matched by an equal amount from other public and private sources. The successful redevelopment of the remainder of the AWD site will not only remove the eyesore of huge dilapidated buildings, but reduce the development pressures on green belt land around Luton and Dunstable. I am sure that that will be warmly welcomed by local people.
I am pleased that the Luton plant of IBC, in which Vauxhall is the major shareholder, has just been chosen as the manufacturing location for vans under the joint venture between General Motors and Renault. That will create 900 jobs in the Luton plant. My Department has developed a close and positive relationship with Vauxhall and its parent, General Motors. I am aware of Vauxhall's aspirations for its Luton plant to produce the Corsa in addition to the Vectra.
However, at this stage, the company has not put forward any specific proposals. My Department would be more than willing to discuss with Vauxhall whether there are any ways in which we can help. I am sure that the hon. Gentleman will note that, and ensure that that message is conveyed back to local people.
Another key issue for the Luton-Dunstable economy is whether the automotive component manufacturers can rise to the challenge of global competition. Bedfordshire business link is leading a £500,000 business support project for automotive component manufacturers which covers Bedfordshire, Oxford shire and Northampton shire.
The project has the objective of raising standards to world-class levels. It covers small and medium-sized enterprises that supply components for racing car constructors and for the volume car market. The project will transfer best practice through focus groups, and will also provide carefully designed and targeted support through business link partnerships. I wish the project every success, and I shall follow its progress extremely closely.
The project is typical of the kind of high-quality support that I expect business links to give to promote our small and medium-sized enterprises, both in the Dunstable area and elsewhere in the United Kingdom. They deserve our great support, for this is the sector from which growth in this country will emerge.
627 Over the next few months, I will be looking closely at all the activities business links are involved in, to ensure that Government support is targeted to best effect. In particular, I shall investigate the work that can be done to improve local supply chains and develop the regional supply network. I am sure that the hon. Gentleman will also want to follow these matters, as they could be of great use in his own area.
The hon. Gentleman mentioned the planning conference that was held in October last year to consider the A5 Dunstable bypass and other local transport issues. I know that he contributed personally to the debate, which brought together a wide range of local interests. I understand that the report of the conference will shortly be considered by Ministers in the Department of Transport.
I understand that the local authorities for Luton-Dunstable are jointly preparing a revised transport package bid for the transport policies and planning round in July. I am advised that the package is likely to include proposals for a public transport corridor, Tran slink, using the redundant railway line between Dunstable and Luton, and will also propose extending the corridor to Luton airport. I am confident that my colleagues in the Department of Transport will give those proposals urgent and careful attention, but a realistic solution to problems of accessibility and traffic congestion in Dunstable depends on local interests reaching consensus on the best way to proceed.
628 I know that the hon. Gentleman is already aware of the good news regarding the scheme to build a new station on the Thames link line at Luton airport. The Department of Transport has allocated £2.8 million of the £12 million available locally.
Obviously, the transport issue is of major concern to the area, and I am sure that it will receive great consideration by my ministerial colleagues, but the hon. Gentleman will also want to be involved in that area very closely indeed.
The Government office for eastern region will continue to work with local and regional partners to regenerate the Luton-Dunstable area, and will ensure that the experiences and concerns of local people are taken into account when decisions are taken on national policy matters.
The Government are determined to do everything possible to help local people to tackle those problems, by introducing specific local initiatives and national policies.
I end where I began, by congratulating the hon. Gentleman on obtaining this debate so early in the new Parliament; by assuring him that I shall continue to take a very close interest in these matters; and by assuring him that we shall continue our discussions with him and others to ensure that the people of Dunstable know that their industry and their local situation are of deep concern to the Government.
§ Question put and agreed to.
§ Adjourned accordingly at twenty-nine minutes to Twelve midnight.