HC Deb 11 November 1998 vol 319 cc306-25

11.2 am

Mrs. Christine Butler (Castle Point)

I am pleased to bring the important subject of the economic development of the east of England region to the notice of the House. Recent legislation will provide for nine English regions, including the east of England, and 1 shall focus on the six counties that will form the east of England region.

I was surprised, and somewhat perturbed, by recent inquiries from the media and others that suggested that they did not know the boundaries of the region. They did not know how many counties it contained and they were not well advised about the new regional development agencies or the regional chambers that will be established and become effective from next year. They also did not know the overall remit of the regional agencies, stakeholders and chambers. Therefore, I propose to outline that remit and inform the House and the wider public about it.

The east of England region comprises Norfolk, Suffolk, Essex, Cambridgeshire, Hertfordshire and Bedfordshire, including the unitary authorities of Luton, Southend and Thurrock. The importance of regional development should be obvious to everyone, because the regions will be able to do what Whitehall alone cannot. I remember the days of Harold Wilson and the Invest in Britain Bureau, which did a marvellous job. Since then, we have had Scottish and Welsh Development Agencies, which proved very successful. It is time now for regional devolution to the English regions and for the promotion, especially, of the east of England region.

The board of the regional development agency is now being drawn up and the chairman is Vincent Watts. I congratulate him on his appointment and wish him every success in his endeavours. I hope that he is listening to the debate. The chambers are also being formed and they will be the accountable base in the region. I look forward to the time, perhaps in the next Parliament, when we have regional government with a directly elected chamber.

The new policies have some detractors, but I hope that today's debate will reassure them that the policies are right. The need for a strategic investment and overview, with counties and stakeholders working together for the greater benefit of the entire region, is something no one can deny. The new RDA has the support of the voluntary sector, the Confederation of British Industry, local government, the training and enterprise councils and a range of other stakeholders. They are happy with the new development and wish to see it go even further, as do I.

The regional boards will bring private sector leadership that will help to drive the regional economy forward. The Regional Development Agencies Act 1998 describes the functions of the regional development agencies. They are: to further the economic development and the regeneration of its area … to promote business efficiency, investment and competitiveness … to promote employment … to enhance the development and application of skills relevant to employment in its area … and to contribute to the achievement of sustainable development in the United Kingdom where it is relevant to its area to do so. That last point should be underlined.

The region of the east of England comes 42nd out of 77 regions in Europe for gross domestic product. Until 1995, it was sixth in the UK—those are the latest statistics that I have found—but I have been told that the situation has improved since then and the region may now lie third. The region is diverse. To the north, it has food processing and huge agricultural interests. Research and development activity is above average, and includes a pharmaceuticals base. It has a defence industry, including firms such as GEC Marconi, which has been a significant influence. Research and development takes place at Ford's huge plant at Dunton near Basildon. A wonderful skills and technology transfer is about to happen, and I welcome the recent developments in that respect in some of our more notable university towns. More needs to be done.

The Cambridge area is one of the region's drivers for science and technology. 1 hesitate to step on the toes of another hon. Member. so I will not to go into too much detail, but I want to describe some of the things that are happening and that need to happen. We face real challenges in respect of our evident weaknesses.

Mrs. Anne Campbell (Cambridge)

Will my hon. Friend give way?

Mrs. Butler

Briefly, but I encourage my hon. Friend to make her speech later. If she—

Mr. Deputy Speaker (Mr. Michael Lord)

Order. [Interruption.] Order. The hon. Lady must take her seat when the occupant of the Chair stands. Hon. Members who are speaking should give way or decline interventions immediately not have a mini-debate on the subject.

Mrs. Campbell

rose—

Mr. Deputy Speaker

Order. Mrs. Christine Butler.

Mrs. Butler

I give way to my hon. Friend.

Mrs. Campbell

I am most grateful to my hon. Friend. I do not wish to interrupt the flow of her remarkable speech. The growth of high-technology industry in Cambridge and south Cambridgeshire can be an important driver for the region, but it is important to get the infrastructure needed to allow the diffusion of high-tech industry. I hope that we agree that some parts of our region badly need development but are prevented from getting it because high-tech industry is concentrated into a small, congested area around Cambridge.

Mrs. Butler

My hon. Friend is right. Our region is diverse and has disparities within it. Some areas are performing well, some not so well. In general, the better-performing areas are central and the less-well-performing areas are the peripheral and coastal areas and those nearer London. They have problems. In some cases, transportation links are weak. We need increased investment in public transport to supply the rural hinterland around Norwich and Cambridge, and towards the coast, as well as seeking regeneration in the south.

In south Essex, our old infrastructure needs to be tackled. It would help if the east Thames gateway were extended as far as Southend, matching the extension that is developing well in Kent on the other side of the river. We are not foolish enough to believe that that would bring enormous grant aid, but it would align us with the rest of the corridor. We would be able to bid into the regeneration and seek improvement in south Essex.

The east of England has a diverse economy with no single predominant industry but it has one of the largest concentrations of new and growing businesses. Within that there are significant geographical concentrations in successful industries such as food processing in the north of the region, pharmaceuticals in the south, and biotechnology in the Cambridge area. However, it must be recognised that the region has areas of economic inactivity and low productivity. Some urban, coastal and rural communities have suffered from adverse market changes and deprivation, with low earnings and household income depressing local spending.

The Government offices for the regions have been tasked by the Government to produce a strategy. I have the "East of England Competitiveness Strategy 1998–2008", and I was pleased to see it. Hard work has gone into it and I congratulate the Government office that produced it on its stalwart efforts in getting it in before time. It is a good programme. The background information notes that gross domestic product per capita in the east of England is 92 per cent. of the European average, placing it 42nd of the 77 European regions.

Mr. Andrew Lansley (South Cambridgeshire)

I am grateful to the hon. Lady for her courtesy in giving way. Does she agree that the document to which she referred is not yet the strategy of the regional development agency, which is not due till next October? Can she venture a project that is to be undertaken by the RDA that would add value to existing activities in the eastern region?

Mrs. Butler

I note what the hon. Gentleman says, but he is saying it to trip me up. I was hoping for a constructive debate. We are present at the imminent birth of something. I am trying to describe the work and research that has gone into what needs to be done and the methods for doing it. It is all very well for the hon. Gentleman to shake his head and smile. I note that his party is not enamoured of the strategic approach that can be gained through regions. I think that he is wrong.

Mr. Kerry Pollard (St. Albans)

Does my hon. Friend agree that there has been increased inward investment in the region as a direct result of the establishment of the RDA?

Mrs. Butler

My hon. Friend is right, but effective implementation, with the boards and chambers up and running, has not yet happened. It is being readied, but already the interest and the work that has been going on have encouraged investment. Improvements have been made already. I do not have the information with me for the enlightenment of the hon. Member for South Cambridgeshire (Mr. Lansley), but I have read of areas where inward investment has occurred because of that approach.

The aim of the strategy is that, in 10 years, the east of England should be one of the 30 most prosperous regions in Europe. Considerable benchmarking has been going on. The objectives are outlined as follows: Improving the Performance of Existing Businesses Attracting and Creating more Businesses Developing a World Class Workforce Developing a More Effective Communications Infrastructure Helping Business to Meet Regulatory Requirements Economic Development to be Environmentally and Socially Sustainable.

For the next steps for each objective, the competitiveness strategy identifies the key actions that the east of England needs to take. On Improving the Performance of Existing Businesses", it identifies: Promoting Benchmarking Encouraging Innovation Preparing for EMU Developing Expertise in Business Support Improving Management Training. It is not a moment too soon. There is a productivity deficit not only in the east of England, but in the entire United Kingdom. By saying that I do not mean to take a shot at the work force—an interpretation that Opposition Members have previously tried to promote, which is dishonourable of them—but to urge improvement of management skills and procedures, and an increase in investment.

To attract and create more businesses, we need to increase inward investment. We need to strengthen support for start-ups, identify sectors for support and arrange local clusters surrounding a dominant industry, whose core needs can be met through a mutual approach to the product of the main business. The hon. Member for West Chelmsford (Mr. Burns) looks puzzled: I am willing to give way if he wants to ask a question.

We need to develop a world-class work force by defining skills needs. That problem requires attention. I have attended several regional forums in which businesses say that, although they have job vacancies, the work force lack the fully developed skills needed to meet the demands of the local labour market.

Mr. Simon Burns (West Chelmsford)

I am extremely grateful to the hon. Lady for inviting me to intervene. She has raised the importance of encouraging business start-ups. As a fellow Essex Member of Parliament, will she tell the House what she thinks has been the significance of the AMT—the regional centre for the advancement of manufacturing and technology—in Essex?

Mrs. Butler

I was a member of Essex county council when the decisions on that and the Konver programmes were being considered. In truth, to judge the benefit of the AMT is not an easy task.

Mr. Burns

Why not?

Mrs. Butler

I shall continue with my speech, because other hon. Members want to make a contribution.

We have skills deficits in certain areas and I urge my hon. Friend the Minister to do what he can to help address those problems. I suggest that what is needed is closer co-operation between further and higher education, as people in certain parts of the region lack ready access to higher education. I congratulate some local institutions that are franchising with further education and thereby enabling students to undertake higher education courses locally. Anglia polytechnic university, which is an example of a good regional university that is vocationally oriented, offers a model which others might do well to emulate.

It would be wrong to talk about what business can do without addressing what others can do. Two planning conferences—Serplan, the south-east regional planning conference, and SCEALA, the Standing Conference of East Anglian Local Authorities—meet and their remit is wider than the eastern region. I hope that, in future, there will be one planning conference that covers the eastern region as a whole, as that would be helpful.

I congratulate my hon. Friend the Minister on the marvellous work he has done so far. It is his stated opinion that, within the current proposals and policies and the legislation that is soon to be enacted, there is a promise of evolution. I am pleased about that, but I should like that evolution to develop as fast as possible. Much will depend on the performance of the RDAs and the regional chambers.

I want the funding regime for the RDA to be more generous. I acknowledge the money coming from English Partnerships and the Rural Development Commission and the valuable work of the Government office for the eastern region, but I also want the training and enterprise council budget eventually to go to the RDA, and the TEC and other bodies to have to put in value-added bids. That would be a good way to ensure that the dynamism behind the economic regeneration and future development of the area rests with the RDA; thus, the RDA will be seen as important and powerful, which will attract the right players to it.

I should not like to finish without mentioning transport. If we are not careful, we will bid for too many roads, which would not fit in with the integrated transport White Paper. Instead, we need to reduce the need to travel. Our efforts might take the form of a regional planning guidance note 13, which would try to drive planning towards having transportation corridors, with areas of employment and housing more closely integrated, thereby obviating the need to travel long distances to work. That trend is stronger in our region than anywhere else. Such policy must be developed for the long term because planning takes time and the implementation of plans takes even longer, but we have to start some time and now is as good a time as any.

Given the eastern region's wonderful geographical position within the United Kingdom and Europe, concomitant with proposals for economic development and regeneration in the eastern region must be planning policies that promote sustainability. Those policies must guide the new boards in their promotion of the region for inward investment and relocation of businesses.

Business can help when there is no requirement for workers to be based at a specific site: for example, call centres do not need to be near an airport—they can be located anywhere. Improvements in communication technology will mean that many more businesses are free to relocate. What is needed is the right sort of support for businesses, so that those things can happen and happen more speedily.

I hope that my introduction and broad-brush description of our region—its best points and its inherent weaknesses—will generate further discussion. I shall enjoy listening to other hon. Members making their contribution this morning. Now that we are about to establish a real identity for the east of England, I hope that stakeholders outside the Chamber will add their voice to the general debate, which I am sure will encourage partnership working in the years to come.

11.29 am
Mr. Bob Russell (Colchester)

I congratulate the hon. Member for Castle Point (Mrs. Butler) on securing this important debate for the eastern region, which, as she said, comprises the six counties of Essex, Suffolk, Norfolk, Cambridgeshire, Bedfordshire and Hertfordshire. They have a combined population of 5 million and the region is therefore bigger than many countries. I do not, however, advocate independence from the United Kingdom. I seek fairness from the Government and the European Union.

The eastern region is the fastest growing in Britain. Not for nothing is it known in government speak as GOER—the Government office for the eastern region. We are all goers in the eastern counties. Between 1981 and 1991, the region's population grew by 6.1 per cent., and an even faster increase of 6.4 per cent. is forecast by 2000, compared with 3.2 per cent. for the country.

With an area of 7,380 square miles or 19,117 square kilometres, the eastern region represents almost 8 per cent. of UK land area. The population is just under 10 per cent. of the UK total. The region, as has been pointed out, is diverse and stretches from the Wash to the Thames, skirting the suburban fringe of Greater London and embracing the finest agricultural land in Britain.

Industrial and commercial centres are located throughout the six counties. New and historic towns and cities are surrounded in most instances by extensive rural areas, which give the eastern region its distinctive urban-rural mix. The coastline is one of the longest in the country, with major seaports and other maritime interests to be found along it. London's developing third airport is at Stansted. The region has six universities—including the University of Essex, which is Britain's most international university—and one of Britain's largest garrison towns. It has a wide range of industrial and manufacturing industries, one of which, I am pleased to say, has been voted Britain's exporter of the year—Woods Air Movement in my constituency.

Although the region is generally prosperous, there are pockets of serious economic and social deprivation, particularly in areas affected by the decline of traditional industries such as agriculture, fishing and defence, as well as the decline of seaside resorts. Its population, gross domestic product and number of businesses represent around 10 per cent. of UK totals, which makes it easy to relate to national statistics.

Unemployment in September was 3.3 per cent. compared with a UK average of 4.6 per cent. That will be of little comfort to my constituents who were told yesterday that the long-established printing firm of Spottiswoode Ballantyne is to shut with the loss of 140 jobs, along with around 90 jobs being lost at the sister company of Cowells in Ipswich. Also, yesterday, 30 workers at Albany Laundry in Colchester heard that they were to be made redundant, news which follows confirmation of the loss of 60 jobs at the hospital laundry in the town.

While the regional unemployment average is below the national figure, the picture is not even. In Clacton, Harwich, Great Yarmouth and Lowestoft, for example, unemployment is more than double the regional average.

The eastern region needs to draw on its strengths to overcome its weaknesses. I shall leave it to others to concentrate on the problems of agriculture, which remains a dominant feature of the region's prosperity.

The need to improve the transport infrastructure is particularly important. I hope that the Government will push forward with all speed the development of the Eurorail connection at Stratford in east London. The road link between Ipswich and Norwich needs to be upgraded. The Minister's assurance today on those matters would be appreciated.

It is vital that we spread new development more evenly. Some areas are experiencing pressures of growth while others witness decline and deprivation. That balance must take account of the need to retain the best of the region's distinctive qualities: our attractive natural and built environment. We have a diverse economy, and we must maintain that. We have an adaptable work force with good industrial relations.

The eastern region, however, is 42nd out of the 77 regions in the European Union Economic League. We have the potential to make it one of the most prosperous in Europe, as set out in the "East of England Competitiveness Strategy 1998–2008", the launch of which I attended in the summer.

Today's debate provides an opportunity for the 56 Members of Parliament for the eastern region to highlight all that is good in our part of the UK. We look to the Government to treat us fairly and ask for nothing less than an eastern promise.

11.35 am
Mr. Patrick Hall (Bedford)

I, too, congratulate my hon. Friend the Member for Castle Point (Mrs. Butler) on securing this debate, which the Commons Library informs me is the first debate on economic development in the east of England for at least 20 years. That is, perhaps, an interesting comment on the previous Parliament.

I stress the importance of recognising the east of England as a region and ensuring that the region recognises itself. That is not an easy task because, when one leaves the traditional counties of East Anglia and reaches the south-western and western parts of the region, one finds that people do not have a strong regional identity. In Bedford and Kempston, for example, the connections to the west—to Milton Keynes and Northampton—are at least as strong as those to Cambridge in the east. None of those connections is as strong as those to the south—to London.

If we were to adopt a laissez-faire attitude, London would become the regional capital of everywhere that looks to it for one function or another. That region would be huge, disparate and over-dominated by London. It would be difficult for any activity to take place in most parts of the region because people would live there and travel to and from London. There would be suburban deserts with over-congested transport links into and out of the metropolitan centre. That would be the result of bad planning or, more likely, an abdication of planning, leading to economic under-performance and a denial of opportunity for hundreds of thousands of people whose quality of life would be impaired. In some ways, that is exactly what has happened in past decades. We need, and there is a consensus for, economically dynamic communities across the country, not only in big cities but in towns and villages that have a lot to offer in their own right. We need communities that offer a balance of jobs and social, leisure and educational opportunities. We need communities that enjoy civic pride and care about their area. One of the necessary ingredients for achieving that are strong regions, which offer valuable qualities different from those in London or any other big city.

Today, we have the opportunity to drive forward that process because we have a Government who understand the importance of regional development and who will soon speed up that process through the introduction of regional development agencies.

A strong eastern region will not weaken the special role of London or devalue contacts with any other town or region. It will strengthen those contacts and the country as a whole. We have to make the eastern region work. Much needs to be said about that, but there is not much time for me to elaborate, and I hope that other hon. Members will contribute.

I shall touch on two strategic issues, transport and relative deprivation. The existing transport network illustrates my point. Bedfordshire, for example, is one of the fastest-growing areas of the country in residential development and population growth, yet that has not been matched over the years by investment in the economy, in jobs and in the transport infrastructure. Unbalanced planning has resulted in some of the most heavily congested roads in the east of England, particularly the Al and M1, which are, of course, north-south links.

I am convinced that there are great opportunities along an east-west axis. The eastern region will not prosper unless east-west links are considerably improved. One of the best ways of boosting the eastern region, including my constituency, Bedford, and Kempston, would be to deliver an east-west rail link.

A consortium of local authorities and Railtrack has been working on that project for some years. It is an imaginative proposal for a new rail route running from Ipswich to Cambridge, and then through Bedford, Milton Keynes, Oxford and Swindon, connecting finally to Bristol, with all the important junctions north to south with which that line would connect. It is a fantastic idea.

I understand that a revised business case is being prepared and will be submitted to the Government later this autumn. I hope that it will be sympathetically received, and that Ministers are in no doubt about my support for the concept and for the preferred route through Bedford. In the context of an integrated transport policy and the need to promote environmental sustainability, I hope that an east-west rail link will become attractive for freight as well as for passenger movements.

The second topic that I shall mention briefly, deprivation, is essentially a matter of perception and recognition. The absence of a clear voice for the eastern counties over many years may have assisted in the development of a view in Whitehall and Government circles that there are few problems in the east of England. The impression has been one of general affluence. There are indeed comfortable villages, towns and suburbs, but there are also pockets of deprivation in both town and country, which are not always recognised by Government statistics.

The index of local deprivation, for example, focuses on whole council areas. Bedford borough ranks 218 out of 354 local authority areas in England in the 1998 index of local deprivation, yet three wards in Bedford rank in the top 10 per cent. of the most deprived wards in England. If one adds deprivation in other wards in Bedford and Kempston, about 30,000 people out of 92,000 in the constituency live in such areas—quite a large pocket. That is not the picture usually associated with Bedford and Kempston or with the eastern region.

I do not wish to detract from efforts to tackle deprivation, social exclusion, unemployment and under-performance in any other part of the country. The Government exist for the many, not just for the few. Therefore, every community deserves recognition, and the needs of every community must be measured more accurately. I ask my hon. Friend the Minister to recognise that there are pressing needs in Bedford and Kempston and in the east of England. I am sure that, in the months and years ahead, he will hear more, not less, from me and my hon. Friends about the needs of the east of England.

11.44 am
Mr. Bob Blizzard (Waveney)

I, too, am pleased that my hon. Friend the Member for Castle Point (Mrs. Butler) secured the debate, and that she spent so much time outlining the region in general, as that allows me to concentrate on my part of it.

For someone born in East Anglia and who represents an East Anglian constituency, it has not been easy to come to terms with the boundaries of the eastern region. Many people in my constituency find it hard to comprehend what Lowestoft has in common with Watford, so it is not surprising that the eastern region has yet to develop its identity fully. Like other Members of Parliament and like business and community leaders in my constituency, I believe that we must make the best of what we have—hence, my support for the debate, to help to establish the identity of the eastern region in the House and further afield.

I strongly support a regional dimension to politics and government. That is important for the devolution of over-centralised power in this country, and in order to answer the West Lothian question and to position ourselves effectively in Europe, something that our region has not done in the past but is now beginning to do. There is strong support from business in my constituency for the new regional development agency, and we have high hopes of its tackling the problems in our part of the region.

As has been said, the outstanding features of the eastern region's economy are its diversity and disparities. It is generally seen as a prosperous region, but there are unemployment black spots. Lowestoft in my constituency, and the neighbouring town of Great Yarmouth, have suffered and continue to suffer, perhaps more than any other towns. We have long had the highest unemployment figures in the region. They move up and down, but they are always at least twice the regional average and three times the rate in the areas with the best figures. Unemployment is accompanied by low pay, deprivation, poor health and higher crime. People in my constituency ask, "Why us? Why must we suffer?" They are loyal and hard working, there are good industrial relations and low labour costs, plenty of cheap industrial land is available, and the area is a nice place to live. Lowestoft officially has the best beach in England and we have the Broads national park—a pleasant environment.

However, for the past 15 years, people in my area have suffered unacceptable employment levels and a depressed economy. It is important to analyse the reasons for that decline. We have lost our traditional industries and therefore thousands of jobs. In Lowestoft, we have lost two shipyards and two food canning factories. Many hon. Members will remember the old Co-op brand name Waveney, which gave its name to my constituency. It exists no longer. The Eastern Coach Works was once the largest employer, but that has gone too, as has a shoe factory. Hon. Members will be familiar with the decline in fishing. Once, one could walk right across Lowestoft harbour on the boats lined up next to one another. Now we have just 10 trawlers and 30 smaller inshore vessels. Our inner harbour area contains acres of dereliction, with factories empty or razed to the ground.

We have benefited to some extent from the cushion provided by the offshore oil and gas industry, but jobs there are being reduced. We have had the cost reduction initiative for the new era—CRINE—and unfortunately 140 jobs were lost at Shell's Lowestoft base two weeks ago.

Our part of the region has not succeeded in attracting new industries on a significant scale. Why? I am pleased that other hon. Members have drawn attention to the poor transport links. East Anglia is usually not seen as a peninsula because of its rounded shape, but if one drew a map showing travelling time rather than travelling distance, the peninsula would be greatly extended, possibly right across the North sea.

People in my area were disappointed by the roads review. We feel that we are condemned to continue with roads no better than winding country lanes, clogged up with tractors and with trucks passing through villages— which neither the truck drivers want to do, nor the villagers want to suffer. Our regional newspaper, the Eastern Daily Press, refers to life in the "slow lane". Our branch line railways are no better: it can take longer to travel by rail than by road. That affects business competitiveness in our area. I hope that the forthcoming competitiveness White Paper will recognise the degree to which transport costs and travelling time affect competition.

Transport accounts for a significant proportion of business costs. It is an instrument and an engine of economic development—not just an environmental inconvenience. Ironically, Lowestoft exists because it is a port—in fact, it is the country's most easterly port and has enormous potential as it points straight at Europe. There is container business at the port, which also handles grain imports and exports. Although a port integrates sea and land transport, it cannot operate successfully unless the land transport is adequate. We look forward to improvements in our road and rail transport. East-west links are important, but with only one such link, along the A14 corridor, the northern and eastern parts of the region would be further marginalised.

In order to attract new business, we must offer companies some incentive to relocate to our part of the region. Lowestoft does not have assisted area status and, without it, it is difficult for the council to summon the resources to provide a reason for companies to relocate there. As a former council leader, I dealt with companies that were seriously interested in relocating to the area. However, because we could offer them no real incentive to do so, they often went somewhere else.

It is a travesty of justice that, under the previous Government, Lowestoft did not receive assisted area status—although it was granted to Great Yarmouth. The previous Government realised their mistake and cobbled together some European structural funds, to the extent that Lowestoft was redefined as a rural area and received objective 5b funding. In terms of regional strategy, anyone can see that Lowestoft and Great Yarmouth must be considered together. The answer is to give them both assisted area status and European structural funds, so that the areas that have suffered for so long can be regenerated properly. My hon. Friend the Member for Great Yarmouth (Mr. Wright) would have said the same thing today had he not been attending to other duties in his constituency.

We need a sub-regional strategy for the north and the east of our region, which suffer the most economic deprivation. There is a deeply held feeling that the previous Government severely neglected our area. When one lives on the coast—out on a limb—one is always anxious lest one be forgotten. This Government must not make the same mistake as the previous Government. The regional development agency must recognise our area as a priority and support us with financial measures. If the Government ensure that outcome, they will retain the confidence of people in my local area.

11.50 am
Miss Melanie Johnson (Welwyn Hatfield)

I draw hon. Members' attention to my registered interest with Roche, a pharmaceutical company in my constituency. It gives me great pleasure to contribute to this debate, and I congratulate my hon. Friend the Member for Castle Point (Mrs. Butler) on her success in securing it. Regional development agencies herald the advent of a new era in this country and propose a new identity for the eastern region. They are extremely welcome.

I hope that hon. Members from all political parties will fight with equal vigour and enthusiasm on behalf of the eastern region and its new identity. The hon. Member for Colchester (Mr. Russell) nods his head. I congratulate him on his 100 per cent. support for the region. I also congratulate my hon. Friends on their enthusiastic support for the debate. However, I am disappointed to see only two Conservative Members in the Chamber—although almost twice as many Conservative Members as Labour Members represent the region. I am sorry that the Opposition have not made a positive contribution to the debate, and I hope that hon. Members from both sides of the Chamber will make such a contribution in future.

The eastern region comprises examples of the United Kingdom's strengths and many of its weaknesses. I believe that problems, and many answers, can be found in the region.

Mr. Burns

rose

Miss Johnson

I will not give way as there is not sufficient time. Hertfordshire, where my constituency is located, is an area of skills and relative affluence. It is important to stress the word "relative", because I shall touch on some points raised by other hon. Members this morning—particularly the two previous contributions. Unemployment in Hertfordshire is at its lowest since 1991, and owner-occupation in Hertfordshire is well above the national and regional averages. One factor contributing to that result is the strength of the pharmaceutical base in the region.

More than 2,000 companies undertake pharmaceutical research and development, and a slightly greater number are involved in manufacturing and production. An estimated £900 million was spent on research and development in 1997, and 1996 figures for the region place the value of industry exports at more than £1.6 billion. Interestingly, the region's pharmaceutical industry contributes to the economy by generating an extra gross domestic product of £2 billion a year.

The pharmaceutical industry and other industries are attracted to the area—there are four very active pharmaceutical companies in my constituency—by our highly skilled work force. Some 80 per cent. of the population in Hertfordshire are classified in social groups 1, 2 or 3. Hon. Members can see that industry is drawing on a highly skilled base, which I know that the Government want to see replicated elsewhere in the region and the country. We must increase the skills base and thus boost the economic returns of industry.

However, those statistics and other indices often conceal inequalities. My hon. Friends the Members for Bedford (Mr. Hall) and for Waveney (Mr. Blizzard) spoke eloquently about the way in which those indices disguise the poverty in their constituencies. The situation in my constituency is no different. One in 10 of Hertfordshire's electoral wards has been assessed, on the basis of wide-ranging factors, as being more deprived than the United Kingdom national average. There are 19 deprived wards in Hertfordshire, and areas of concern include unemployment and poor housing conditions. We must take those factors into account when compiling a picture of the region's needs and we must combat those pockets of deprivation while building on the region's economic strengths.

We must recognise, too, the region's diversity—although, sad to say, the region has lost much of that. The once large British Aerospace presence in my constituency is now a vacant site. That traditional industry employed thousands of people in my constituency but it was decimated in the late 1980s and early 1990s, and its 896-acre site is now scheduled for development. That site could be used for housing, to create employment or for university use. We must encourage those sorts of interests in the region on a large scale.

The Minister will not be surprised if I turn to another theme common to those sketched by earlier contributors to the debate. Development of the site—I hope that it will commence within a year or so—is dependent upon improved east-west communications. The site cannot be developed without substantial support for local public transport and better east-west communications. The county council in Hertfordshire, and my colleagues there and in neighbouring counties, are keen to see the central Herts passenger transport scheme receive active support from the Government. That scheme is vital if we are to ensure that major sites such as this are developed and the local and national economies strengthened as a result. We need the link through Watford, St. Albans and through Welwyn Hatfield on towards the east to ensure that massive developments on hundreds of acres, involving housing and nearly 50 hectares for employment, can get under way.

We need to be sure that we have a new deal that will take account of the ambiguities and diversity of the eastern region. My hon. Friend the Minister has heard the good news and the bad this morning. He has heard about the areas where we are strong and the things that we need to tackle. We welcome the Government's approach. Their collaborative approach recognises that all the counties in the region and Hertfordshire can be a model for other areas to emulate, given the way they work together, and the way in which these issues can be dealt with. However, it needs to be recognised that affluence is still to be found alongside pockets of poverty.

I hope that transport will be recognised as one of the key factors. We have the tools to do much of the job ourselves, but we need a transport infrastructure and an integrated transport system that will ensure that progress is made.

It is good to know that Opposition Members who have not contributed to the debate have remained silent to allow Labour Members to speak for longer. I thank the hon. Member for South Cambridgeshire (Mr. Lansley) particularly and his Opposition Front-Bench colleague, the hon. Member for West Chelmsford (Mr. Burns), for their generosity in that regard. However, I hope that the Opposition will be better represented in fighting the case for an exciting region that has a whole lot going for it. My colleagues and I think that it has a bright and promising future, with the Government's full support.

12.1 pm

Dr. George Turner (North-West Norfolk)

The contributions of my hon. Friends have emphasised the diversity of need within the region. In looking to economic development, we need to recognise that a priority is to protect what we have as well as considering the new that we need to develop.

It would be remiss in a debate on the region, which includes some of the best agricultural land in the country, not to make some reference to the needs of farming. The House has spent some time on the issue in recent weeks and I do not need to rehearse the many difficulties that the farming community faces. In the part of Norfolk that I represent, which was at the heart of the agriculture revolution, the main farming interests remain arable. Therefore, we have not suffered to the same extent as the livestock and dairy industries. However, there is no area of farming in recent times that has completely escaped difficulty.

I have been reminded regularly by the farming community—most recently at a meeting with Tom Pexton, the deputy president of the National Farmers Union, Nick Velsboer, the local chairman, and others—of the wide range of problems that it faces. I am confident, following the debate on farming last week, that my right hon. Friend the Minister of Agriculture, Fisheries and Food is aware of the difficulties and is arguing the case in the Cabinet for a set of measures to tackle the immediate issues. Yes, we need urgent action; but I tell the Government that that action needs to be part of a coherent package. It is important that we use extra money to modernise and adapt farming to the needs of the next millennium rather than to postpone problems. We need to address Agenda 2000 and tackle the greater world trade problems that I believe will face farming. I was extremely pleased, at the meeting with the NFU, to hear that local farmers, while in anguish about their problems, recognise that the Government's role is to help them address the future of agriculture.

Agriculture is three and a half times more important in my constituency than the national average. The devastation of the work available in agriculture since the second world war means that it now represents only about 5 per cent. of the economy in my constituency. Those who would see Norfolk as a place for the landed gentry and for tourism may not recognise that 95 per cent. of those who live in the county are dependent on work in industry, commerce and the service industries. That is much the same as elsewhere. When taking averages over large swathes of countryside it is easy not to appreciate that some of the wards in my constituency face needs and problems as great as those anywhere in the land. I hope that the Government, through the regional mechanism, will ensure that pockets of deprivation which seem small when averaged out but which locally are extremely important to those who have to face them, are tackled.

Our needs for industry have in recent times shared much in common with the needs of the rest of the country. I regret to say that, only this morning, the financial press is reporting that the important local company Porvair, which is at the forefront of the manufacture of microporous materials and which exports 80 per cent. of what it produces out of King's Lynn, is facing a 14 per cent. reduction in the work force because of the problems that it has experienced in world markets-owing to the high value of the pound and high interest rates. However, the picture is not all gloom and John Morgan, the chairman of Porvair, believes that the company can adjust, improve productivity, face new challenges and move forward. The same applies to most of the industry in my constituency.

The specific problems that we face in the region have already been mentioned. I challenge any Minister or shadow Minister to take the A47—a recognised trans-European road from Peterborough, through Thorney to Wisbech on the way to King's Lynn—and to feel that it does not need improvement. I accept that, nationally, the balance may have been badly struck between the need to meet traffic demand and the need to have measures to reduce traffic. However, no one can come to northern East Anglia without recognising the need not only for more than one east-west link along the A14 but for dramatic improvements and a dramatic change to Governments' attitudes of the past 20 years.

Last week, during the debate on agriculture, the right hon. Member for South Norfolk (Mr. MacGregor) referred to the Government's being inactive while Rome burned. The question that the Opposition need to address in terms of agriculture and the countryside is: who lit the fires that are burning? Our inheritance of problems in the region reflects decades of neglect of infrastructure. It is extremely difficult to entice investment to one's region to provide jobs for the future and to protect the jobs that are already there unless the Government recognise the needs of those who have never been served by decent roads.

The need for improved roads must be firmly grasped, while the Government must recognise the need in the urban environment to encourage less use of the motor car. I hope that the Government will recognise also—I was among the first to welcome the investment in rural transport provision in the Budget—that we shall never be in a position in rural areas to reduce people's need for the car to get to work and get about generally. That is why we have a high percentage of car ownership in my constituency; it is not because people are wealthy, but because there is no alternative. When we count the number of buses by the week, the exhortation to get on the bus by driving up petrol prices, with no counterbalancing action from the Government, is just not fair to my constituents.

I am sure that the regional development agency and regional government will be important ways forward because, by co-operating within our regions, we can achieve more than by bickering about what goes where. I hope that we will come to sensible compromises on where offices will be located and on priorities to ensure that we do not neglect the minority simply because of the constant need to address the needs of the majority in the region.

12.10 pm
Mr. Simon Burns (West Chelmsford)

I add my congratulations to the hon. Member for Castle Point (Mrs. Butler) on securing this debate, which is extremely important for all of us who have constituencies in the eastern region. How refreshing it is to have had an intelligent debate divorced of the normal party political bickering that, all too often, blights discussions in this Chamber.

I begin by concentrating my remarks primarily on my county of Essex, which, in many ways, is the gateway not only to East Anglia, but to the eastern region. In the southern part of the eastern region, we are fortunate to have a work force that, as one hon. Member has mentioned, is good, well skilled in many sectors and has excellent industrial relations; so it is an area that is attractive for employment and employees, even if we do not enjoy the status in relation to assistance and regional aid that other parts of the country have.

We have a good communications network. That is not exclusive to the whole region, as we have heard from a number of hon. Members.

Mrs. Anne Campbell

Does the hon. Gentleman agree that one of the great constraints on development in the eastern region is the mess that his Government left behind by eroding public transport, which makes it impossible to get from one side of the region to the other?

Mr. Burns

When I allowed that intervention, I feared that we were going to get something that was slightly out of sync with the rest of the debate—and my fears were fully justified. I do not share that poisoned and poisonous view.

In the southern part of the region, we are fortunate in that we have a good transport communications network: the M25, the M11, the A12 and the improvements that, I hope, the Minister's Department will approve shortly to the A130. We have an improving rail network. About 7,000 of my constituents commute every day to London to work. Improvements in signalling, points and rolling stock over the past decade have greatly enhanced rail transport from mid-Essex.

That does not mean to say, as many hon. Members have pointed out, that no further improvements have to be made. Improvements must be made on the Al2 from the M25 to the ports of Harwich and Felixstowe. It is an important feeder road to those ports and beyond. As the hon. Member for Waveney (Mr. Blizzard) said, the roads in Norfolk, although improving in certain areas, leave much scope for improvement.

As a number of hon. Members have said, we need improvements in the infrastructure of the railways. There has been talk of an east-west route from Ipswich through Welwyn Hatfield, Bedford, for which a bid was placed, Milton Keynes and towards Bristol. Given our closer economic and business development ties with Europe and the enhancement of the ports on the eastern seaboard, we need—this is overdue—improvements in that transportation to enhance the general economic well-being and attractiveness of the region, so that we can attract more businesses to it.

We have excellent academic facilities in the region. My own university, the Anglia Polytechnic university, is first rate. The university of Essex, the university of East Anglia in Norwich and, of course, the university of Cambridge in the constituency of the hon. Member for Cambridge (Mrs. Campbell) are vital in developing links.

Miss Melanie Johnson

The university of Hertfordshire.

Mr. Burns

We have another bid—the university of Hertfordshire. Those universities are important centres of excellence for working and developing links—in both training and product research and development—with local industries. More work must be done to build on the successes.

Dr. Ian Gibson (Norwich, North)

Will the hon. Gentleman give way?

Mr. Burns

I will not, if the hon. Gentleman will forgive me, because I have only five minutes. I do not want to eat into the Minister's time.

There is a problem in my county, not exclusively in my constituency, because it also affects the constituency of the hon. Member for Basildon (Angela Smith) and, I suspect, the Colchester area as well. Essex towns such as Chelmsford, Colchester and Basildon have a manufacturing base that one does not naturally associate with the leafy green suburbs of the home counties; the size of that manufacturing base has perhaps been unusual.

We are proud of that tradition, but many of those manufacturing companies are defence-related industries. In the past eight years in particular, with the ending of the cold war, the worldwide recession of the early 1990s and a greatly increased competitive world market, pressures have been exerted on companies to compete in those markets and to win contracts. We have paid a high price for the peace dividend, with significant redundancies being made in those defence-related industries.

Those companies have had the foresight to diversify, to protect and, in many ways, to expand their core base, but we have had to pay a price. We have been fortunate. I pay tribute here to Essex county council, under the control of all three main political parties over the past eight years, to the previous Government through the Department of Trade and Industry, and to this Government for the way in which they worked with the European Union to designate Essex an area that qualified for Konver funding, in relation to both Konver 1 and 2. That led to developments such as the advanced manufacturing centre in Chelmsford.

The centre has done critical and crucial work to help defence-related industry employees who have been made redundant to reskill and to retrain, and to give them the opportunity to use their skills and expertise to help to build small businesses. That is an important way forward, which puts back some of the goodness that has been taken away with the redundancies in the local economy; it starts off the small businesses of today that, I hope, will be the medium businesses of tomorrow and the larger employers of the future.

That is the way in which I would like further development to enhance the local manufacturing base. We do not want a constant erosion of that base to the point where a local community's employment base has been shifted significantly from a mix of services and manufacturing to services alone.

Not only in Essex, but throughout the region, we have to ensure that we promote ourselves as an area that is vibrant—that has much to offer both in its living environment and cultural events—so that people want to relocate there. More often than not, for financial reasons, companies will locate in areas where there are substantial Government grants through regional aid.

The east of England is a success story; it has a vibrant community. We must build on the work of many local authorities and other organisations and sell the region to ensure that we get our fair share of inward investment. We do not want to lose any more industries. Over the past 20 years, many have moved to other parts of the country because of financial benefits and local tax breaks.

I do not share the enthusiasm of the hon. Member for Castle Point for regional development agencies, although we will have to await the establishment of our RDA next year to see whether it produces any concrete achievements. I disagree with her views on regional government —it would be another layer of pure bureaucracy, which would stifle rather than enhance the enterprise and initiative of business and commerce. I suspect that she and I will never agree on that matter.

I again thank the hon. Lady for giving us the opportunity to debate this important subject. I shall now sit down so that the Minister has a reasonable time to respond to the debate.

12.20 pm
The Minister for the Regions, Regeneration and Planning (Mr. Richard Caborn)

I congratulate my hon. Friend the Member for Castle Point (Mrs. Butler) on securing the debate. I am delighted that she has chosen this subject. The contributions from the Labour Benches have been very thoughtful and have done credit to the region. I do not want to introduce a sour note to the debate, but Labour has 22 Members representing the region and the Opposition 33 Members, yet not one Conservative Member has participated in the debate—other than the Front-Bench spokesman, the hon. Member for West Chelmsford (Mr. Burns). They do not take the future of their region as seriously as do Labour Members—and, indeed, the hon. Member for Colchester (Mr. Russell), 100 per cent. of the Liberal Democrat representation in the region. Before the general election, Labour had four seats in the region; it now has 22. No doubt we will have even more after the next general election.

As my hon. Friend the Member for Castle Point rightly pointed out, the east of England is seen as a relatively prosperous region making a significant contribution to the United Kingdom economy. However, there is great concern that the region is not performing to its full potential—a point made by the hon. Member for West Chelmsford. If we take gross domestic product per head as a measure of performance, the region lies only 42nd out of 77 European regions. That is a legacy that the previous Government left us and we are determined to put it right.

In fact, if the London effect is stripped out, the region is below average in prosperity relative to the UK. On a workplace basis, GDP figures put the region after London, the south-east, Scotland, the south-west and the east midlands and only just ahead of the north-west. On a residence basis, which allows for the income brought into the region by commuters to London, the region is above the UK average with an index score of 109, behind only London and the south-east. However, on both measures, the relative score of the region has been on a downward trend over the past five years.

The region is highly varied. It incorporates the northern fringe of Greater London, medium industrial and commercial centres, and ports and seaside resorts, which have been described in the debate. It has no major conurbations, but a variety of new and historic towns and cities and extensive rural areas. It has areas of prosperity and growth, but also areas of real deprivation. It combines traditional manufacturing and agricultural industries with leading-edge technology and knowledge-based industry. Expenditure on research and development is 3.5 per cent. of GDP—the highest of any UK region.

However, the region is vulnerable and, as has been described in the debate, unfortunately there have been some job losses recently. That said, over the past 18 months there have been major new investments and real growth in the region, especially in retail, computing and financial services. Overall, employment is still increasing and the unemployment rate continues to decrease, remaining below the national average in every county in the region.

As has been said many times, the east of England is a relatively new region. It brings together East Anglia with the home counties of Bedfordshire, Essex and Hertfordshire. The region is, of course, still building its identity. I am greatly encouraged by the activity of partnership groups in the region, which have worked together in recent months to ensure that the East of England regional development agency—to be known as the EEDA—gets off to the best possible start. Local groups are working together to develop and implement regional strategies in key areas such as competitiveness and skills. All that activity has made a real contribution to partnership working in the region across a very wide range of interests, and through that to strengthening the region's identity.

I know from my visits to the region that there is a real enthusiasm in the east of England for the principle of a development agency and for a stake in its activity. That has been shown by the fact that we have received more than 400 high-calibre applications for the 12 seats on the board and almost 100 applications for the post of chief executive. The agency will be able to build on that commitment and activity to develop a fully integrated approach to regional development, both at a strategic level and at the coal face—although for this region it is the high-tech face—where local delivery organisations play such a key role.

A key task of the agency will be to produce a regional strategy to meet its responsibilities, including economic development and regeneration, employment and development skills, and sustainable development. That is in contrast to what was said by the Opposition spokesman, who adequately laid the problems of the region before the House, but not the way to resolve them. We are doing that—

Mr. Lansley

How will the development agency's strategy document interact with the agreement on PPG6 covering Cambridgeshire, Norfolk and Suffolk, as that is to be concluded before the RDA sets out its strategy?

Mr. Caborn

If the hon. Gentleman will bear with me, when I get to the relevant part of my speech I will deal with the plan, which is important.

The EEDA will need to take an integrated approach to producing its strategies and have regard to the needs of the east of England—urban and rural, sub-regional and local. We strongly believe that an integrated and inclusive approach is the best way to improve regional economic performance and to break down what I believe are artificial barriers between the rural and urban areas.

Our aim in the draft guidance on regional strategies has been to provide a steer to RDAs in producing their strategies, without being over-prescriptive and unnecessarily tying their hands. The strategies should not simply restate national policies, but will need to be relevant to the region and address its specific problems and the underlying structural weaknesses in terms of wealth creation.

Land use and transport issues are especially important in the east of England, where a combination of rapid population growth and economic development on the one hand, and rural decline and defence closures on the other, have created conflicting demands and pressures on the infrastructure. Again, that was adequately described in the debate.

I am very pleased that the first of the new public examinations of regional planning guidance will be in the east of England, when the Standing Conference of East Anglian Local Authorities hearing takes place in February. That will be followed in May by the south-east regional planning committee hearing. Those hearings will provide an opportunity for everyone—including hon. Members—to have their say before final decisions are taken. PPG6 will be taken into consideration in the plan as it develops for the eastern region. We are trying to bring together the economic strategic overview for the eastern region with spacial planning and transport planning. We will then have a strategic overview of what is necessary in the eastern region.

The regional planning conferences are also beginning the vital new task of preparing integrated transport strategies, which will link on the one hand with the four-month modal studies that we have announced in the east of England, and on the other with the new integrated local transport plans. After that round is over, we shall begin the process of realigning the regional planning structure to match the new regions. Local authorities in the eastern region are already co-operating across the boundaries of SCEALA and SERPLAN, and RDAs will become another partner working in close co-operation with local government on planning and transport issues as it develops economic strategy. Such partnerships are where the impact on transport in the east-west corridor can be argued out, and they will inform Government policy. It is a bottom-up approach, working in partnership.

I have not been able in this debate to go into too much detail about RDAs. Nevertheless, when they begin functioning next April, they will make a significant difference in regions' ability to plan for the future. The eastern RDA will not only manage change but will develop the eastern region's assets, to ensure that it achieves the status that it wants as one of the best and most productive regions in the European Union. I again thank my hon. Friend the Member for Castle Point for initiating the debate, which has been very useful.