§ Baroness Lane-Foxasked Her Majesty's Government:
What assessment they have made of the effectiveness of the Development Commission's economic programmes.
The Minister of State, Department of the Environment (The Earl of Caithness)An assessment of the Development Commission's programmes for the economic development of rural areas has been carried out by ECOTEC Research and Consulting Ltd. under contract to the Department of the Environment. The report is being published today by the contractor, and a copy has been placed in the Library of the House, together with an executive summary.
The report concludes that the commission has successfully supported a very wide variety of firms operating in rural areas, which are generally independent, small, youthful and dynamic. Less than 10 per cent. of them are craft firms. The premises provided under the commission's programmes have generally met the requirements of these firms, have resulted in substantial numbers of new jobs, and will continue to have a job generation potential over perhaps 30 years. Substantial numbers of new jobs have also resulted from the advice and loans provided, on behalf of the commission, by the Council for Small Industries in Rural Areas (CoSIRA).
In total, the report's findings confirm that the commission (including CoSIRA) has been generating thousands of new jobs each year. It is estimated that over 80 per cent. of these have been taken by people living in rural areas. The report concluded that the 74WA commission's ability to provide a range of complementary services is valuable to firms, and that the present balance between different activities is about right, but that there is scope for greater emphasis on advisory services, which have been particularly cost-effective in generating jobs.
One issue considered in the report is whether the private sector could play a greater role in future. It confirms that factory building by the commission has not generally duplicated activity by the private sector or other agencies, but suggests that competitive tenders might be sought from private developers for specified programmes of factory construction and that a higher rate of redundant building grant might be offered for the conversion of buildings to let. The commission is now investigating how private finance could most effectively be used in the light of these suggestions.
The report also emphasises the importance of satisfactory arrangements for training. The commission has now established a Rural Training Advisory Panel, which is investigating the way in which training is provided and co-ordinated in rural areas with a view to co-operating with the Manpower Services Commission in the preparation of a guide to best practice.
The Development Commission has a vital role in helping rural areas to meet the major challenges they now face. The Farming and Rural Enterprise package in March 1987 identified it as the principal agency charged with carrying forward the Government's proposals for diversifying rural enterprise, and included several specific new initiatives within the services which the commission provides. The ECOTEC report suggests other possible initiatives which appear to have significant potential, and my right honourable friend the Secretary of State has asked the commission to investigate these further in the context of preparation of their 1988 corporate plan.