Development Associations (Grants) (Hansard, 24 June 1982)

§ Mr. Norman Lamont

I wrote on 23 June to the chairmen of the four English regional development organisations on this subject, having previously discussed it with them at a meeting on 1 April. In the letter I confirmed that the Department of Industry will continue to support the work of the four English RDOs, during a further three-year period starting in April 1983. Our grant in aid will continue to be paid primarily to support their work in attracting inward investment projects to the regions concerned, including promotional activities overseas which complement the United Kingdom national promotion effort. I am prepared to increase the level of the grant for 1983–84 and the succeeding two years not just to take account of inflation, but to allow some real increase in the effort made by the RDOs overseas. This could be done in two ways.

The first way would mean the Department of Industry increasing its total expenditure on the grant-in-aid to the four bodies collectively—£610,000 in the current year—by about 50 per cent. The division of this sum among the four organisations in each of the three years from 1983–86 would depend not only on the existing guidelines and matching arrangements—that is, the RDOs have to match each £1 of grant with £1 from other sources 147W of income—but on the preparation by the RDOs of a costed programme of events for the forthcoming year, to be agreed with DOI officials in September. The precise size of the grant available to each RDO would, therefore, not be agreed in advance, but assuming that the organisations put forward realistic programmes of overseas events, and could guarantee matching funds, the grants for each of the three years in question could be considerably more than the current level.

Since it may well be felt that this arrangement would not fully meet the point that the English regions are treated less generously than Scotland and Wales, I am prepared to envisage a greater increase in the Department's grant, together with relaxation of the pound for pound matching arrangements, in order to offer something closer to parity with the resources available to the promotional agencies in Wales and Scotland. But this would be on two conditions. First, as in my initial proposal, the payment of the grant each year would be dependent on the RDOs agreeing with my officials realistic, costed programmes of overseas promotion for the coming 12 months. Second, in line with the position which now obtains in Scotland and Wales, the RDOs would have to co-ordinate fully and effectively the overseas promotional activities of all the local authorities and new town development corporations in their regions. I regard it as essential to justify substantially increased Government funding of regional promotional activities that we should eliminate the wasteful and counter-productive competition that exists at present for the relatively small number of new inward investment projects from overseas.

It must, of course, be a matter of choice whether the local authorities and new towns accept the co-ordinating role of the RDOs within the regions as I have described it. This co-ordination need not preclude them from devoting resources to individual overseas promotion, in addition to their direct financial contributions to the RDOs, but all such activities would have to be agreed in advance with the RDOs and would have to be an integral part of their own programmes, as is the case in Scotland and Wales, to be further co-ordinated on a United Kingdom basis.

The letters conclude by inviting the Chairmen and Directors of each RDO individually to a meeting with me in the near future, to discuss my proposals in more detail. At these meetings I should like to discuss also possible arrangements for regional representation overseas, particularly in the United States of America, as well as the question of membership of the committee on overseas promotion and the direct participation of the four English RDOs in its work.