North of England: Grants (Hansard, 16 December 1997)

§ Lord McIntosh of Haringey
My Lords, I can assure the noble Lord that the Government are concerned to ensure that the north of England is treated as equitably as other parts of the United Kingdom. However direct comparisons of public expenditure between the English regions and Scotland and Wales are not possible. Unlike Scotland and Wales, the English regions do not receive block grants to cover all services but are funded through a range of government programmes. Those programmes are generally allocated to reflect needs at regional and local level.
The Government are, however, committed to promoting growth, opportunity and fairness in the English regions. As a clear signal of their commitment, the Government published a White Paper, Building Partnerships for Prosperity, on 3rd December. That paper sets out the Government's plans for setting up regional development agencies.

§ Lord Peyton of Yeovil
My Lords, one admires the skill with which the noble Lord defends the Government's otherwise open goal. If it is in order, I wish also to add my congratulations to the Government on their perspicacity in using the noble Lord's skills. As he will not give us any information, I hope I may ask him how accurate it would be to say that government spending, local and national, in the north-east and the north generally is 30 per cent. less than it is in Scotland, and marginally less than that in Wales? Does the noble Lord realise that it seems to most people that the Government are bent on massaging through their policy of devolution by persuading the protagonists of that policy in Scotland and Wales that they can have their cake and eat it?

§ Lord McIntosh of Haringey
My Lords, flattery will get the noble Lord nowhere. In this case the first Answer that I gave was entirely accurate and does not allow the noble Lord to draw the conclusion that government spending in the north-east or the north of England—I am not sure which he wants to alight on—is 30 per cent. lower than in other parts of the country. As I made clear in my first Answer, we know the figures relating to some services, but figures relating to a large number 492 of services, including, for example, the National Health Service and central Government's contribution to local authorities, are not calculated on a regional basis. There is no basis for the noble Lord to make the assumption that he does.

§ Lord Islwyn
My Lords, has the Minister seen the figures out today which show that all-cause death rates in Wales are 13 per cent. higher than in England; there is a 10 per cent. higher incidence of cancer in Wales; and for heart disease the figure is 17 per cent. higher? Bearing in mind that the gross domestic product in Wales is only 83 per cent. of the United Kingdom average, do not these figures suggest that some urgent attention needs to be given to the problems of Wales?

§ Lord McIntosh of Haringey
My Lords, I am sure that my noble friend quotes correctly figures that I have not seen. I have no reason to doubt that. He is certainly correct in saying that GDP per head in Wales is only 83 per cent. of that in England. However, if one takes identifiable general government expenditure—which is all that we can take and excludes the expenditure I have already referred to—the figure for Wales is 109.5 per cent. of the GB average.

§ Lord Barnett
My Lords, I am delighted to hear that my noble friend is concerned to help the north of England. I can perhaps suggest a way in which he may be able to do that, although I gather he is not willing—perhaps he will confirm this—to do anything to create a Barnett formula mark 2, which I have personally recommended to him. While he could not accept some of the figures explained so sensibly and at length by the noble Lord, Lord Peyton, does he accept that national income per head is now higher in Scotland than in many parts of the UK, including the north of England? In those circumstances, as he will not change the Barnett formula to mark 2, does he accept—is it going to happen?—that in the public expenditure review as the base line is not concerned with the Barnett formula, the formula will be included?

§ Lord McIntosh of Haringey
My Lords, as my noble friend knows, the Barnett formula mark 1 has been agreed as the basis for expenditure by the devolved Scottish and Welsh bodies. Although we continue to be interested in what my noble friend says about the Barnett formula mark 2, the mark 1 formula has many virtues—not that it is necessarily accurate in all respects—and used to avoid argument every year, but now it seems to attract argument every week. My noble friend is not correct about GDP per head in Scotland. That is 96.9 per cent. of the GB average, rather than the higher figure that he suggested.

§ The Earl of Lauderdale
My Lords, can the noble Lord tell the House whether a north-east regional assembly could or would make things any better?

§ Lord McIntosh of Haringey
My Lords, we are not at the moment proposing a north-east regional assembly. We are proposing regional development agencies which 493 will take over a large number of the functions of central government. Matters relating to regional assemblies are included in our manifesto but I think that they are some way further ahead.

§ Lord Peston
My Lords, is my noble friend not puzzled by his reply to the Question of the noble Lord, Lord Peyton? Is it not the case that all public expenditure must take place somewhere? Is it not also the case that it must be accounted for? How does it happen in the age of the computer that the Government are still able to say that they cannot allocate these sums to the regions? That seems an impossible answer.

§ Lord McIntosh of Haringey
My Lords, of course all government expenditure must be accounted for at some stage, but decisions on where government expenditure takes place can be taken at a number of different levels in the administrative hierarchy. Some are taken very much at a local level; others are taken by regional hospital boards, for example, which do not correspond with other regions. Some decisions are taken centrally. If I was puzzled about this matter, it would concern our inability properly to calculate the subvention; in other words, the difference between public expenditure and what we receive from the regions in taxes.

§ Lord Mackay of Ardbrecknish
My Lords, will the Captain of the Yeoman of the Guard accept my congratulations, along with those of my noble friend Lord Peyton, on the way he handles all the various briefs that he is handed by the Government? Will he accept from me that it is a pretty pointless exercise to try to range Clydeside and Tyneside in competition with each other when both of them suffer from the same problems and require special help from the Government? Both of them received special help from the previous government and I certainly expect them to receive it from this Government. That way we get inward investment and growth in employment in those areas. In regard to the north of England, will the Minister tell the House what is the position in relation to the Samsung development? I understand that it has now been cancelled due to problems in the Far East.

§ Lord McIntosh of Haringey
My Lords, the noble Lord's first question should properly be addressed to his noble friend Lord Peyton, who, I suspect, was listening with his usual intensity. As to the noble Lord's second question, I do not know the answer; I shall have to write to him.

§ Lord Peyton of Yeovil
My Lords, I am not here to answer questions, but perhaps I might ask —

§ The Lord Privy Seal (Lord Richard)
My Lords, I am very sorry, but we have already spent nine minutes on this Question.