Rebalancing Regional Economies

I remind hon. Members that they may only make a speech with prior permission from the Member in charge of the debate and the Minister. If you do not have that permission, do not try to speak. As is the convention for 30-minute debates, there will not be an opportunity for the Member in charge to wind up. I also remind Members that the debate is only half an hour; if the Member in charge does take interventions, bear in mind that the Minister also has to respond.

I beg to move,

That this House has considered the potential merits of rebalancing regional economies.

It is a true pleasure to serve under your chairship, Mr Dowd. This Government have rightly prioritised growth, devolution and the need for growth to be seen in all regions and nations. Last year’s Budget and this year’s spring statement freed up £113 billion of infrastructure investment. Huge amounts of work are being done to develop industrial strategies that will drive forward key sectors. We have new trade deals, and have seen the corporate world commit record levels of investment in renewable energy, artificial intelligence and many more sectors.

Brilliant stuff—but what does it actually mean to the people of Rossendale and Darwen, Blackpool, Winsford, Macclesfield, or Cornwall? Clearly not much yet, given the kicking we got in the local elections. These small towns and coastal communities are the places where productivity is lowest.

My constituency is both rural and coastal, which presents a unique set of challenges in terms of deprivation and neglect. Urban areas often receive targeted investment, but rural and coastal communities can be overlooked. Does the hon. Member agree that the Government must adopt a tailored approach, taking into account the rural premium in the index of multiple deprivation, to specifically address the distinct needs of such areas and unlock their significant economic potential?

I agree with the hon. Member; her point is largely the thrust of my speech, so hopefully I will align with her thinking.

I commend the hon. Member for securing this debate. He is absolutely right about regional rebalancing of the economies. From a Northern Irish perspective, I can encourage him that Invest Northern Ireland has decided to relocate many of its upcoming businesses outside the Belfast metropolitan area, as a way of moving forward, but does he agree that location can never overtake viability in the economy?

Absolutely. That is the essence of growth for all. It is about going beyond location and beyond geography as a determinant, and getting the right outcomes for everyone. Our small towns and coastal communities are where productivity is lowest, and where the cost of living and housing crises have hit hardest. They have been left out and let down for so long that it is no wonder trust and expectation are so low—but those are the places where the next election will be won or lost, and where this Government must deliver for our communities if we are to live up to our promises.

To mean something to Rossendale and Darwen, and to places like it, growth must translate into real and tangible change in every neighbourhood. It must mean good jobs and accessible opportunities for young people where they live. It must mean that our towns feel clean and safe, and that people have the houses they need. It must mean that our small and medium-sized businesses thrive and put more money in people’s pockets. It must mean that our roads, buses and rail systems actually connect to where people need to go.

I think we all get that—I certainly know the Minister does—but what worries me is that, when it comes to actual decision making, too often the investment planning defaults to big cities and existing growth areas, with the role of small towns seemingly reduced to just feeding people into the great city machine. Indeed, it can often be a presumption that the answer for small towns is nothing more than better transport into a city. Such thinking totally misses the point.

I will give way to my hon. Friends sequentially.

My hon. Friend is making an excellent speech. Does he welcome the news announced today that 12,000 civil servants will move out of London and into the regions to work on exactly these issues? Would he recommend that some of the civil servants moving to the west midlands should come from the Department for Business and Trade, so they can focus on the automotive sectors, the defence sectors and the advanced manufacturing that really make our region great?

I thank my hon. Friend for his intervention. Indeed, that movement out into the regions is vital; a thrust throughout this debate is the understanding of regional and local realities. That movement can only be welcomed, and it should be as broad as it possibly can be.

I was very exercised by my hon. Friend’s point about “feeding people” from small towns into cities—a very patronising view espoused by ill-informed lobby groups such as the Centre for Cities. Does he agree that that view denies the reality: that people who live in towns want their towns to be successful and have real pride in their towns, including places such as Stockton, Billingham and Norton in my constituency? That success is good for the country, good for those towns and good for the people who live in them.

I agree 100% with my hon. Friend. It is the pride that we have in our towns that really matters. Good things should happen in our towns, not just in some distant city that only a tiny proportion of people in a town might be lucky enough to be able to travel to. That includes pride in our neighbourhoods; neighbourhoods are important to their residents.

Having said that, I do not deny for a moment that cities are our economic engines and that we desperately need to address the productivity gap between our regional centres and London—but, as we have said, this process cannot just be about the cities and the big towns. It matters little to the people of Bacup how well Manchester is doing. Instead, we need to see the good things happening in Manchester mirrored in places such as Bacup. That is the true test of whether we are delivering for all.

I thank my hon. Friend for securing this important debate. Greater Manchester has the fastest growing economy in the UK, with the most diverse range of sector strengths in the country, but despite that, Greater Manchester’s productivity is still 35% below London’s. Does he agree that we cannot rebalance our regional economies without major investments, such as the Northern Arc, which could double the size of the region’s economy in 30 years?

I thank my hon. Friend for that intervention. That is largely the point: we must rebalance our economies by bridging the productivity gap between our cities, including our northern cities, and the rest of the country. At the same time, though, we must make sure that that growth in cities such as Manchester, which in many ways is doing great, is felt in Lancashire and other places at the same time.

I thank my hon. Friend for securing this important debate. My point is similar to that of the hon. Member for Tiverton and Minehead (Rachel Gilmour). We often discuss the rebalancing of regional economies in terms of urban versus rural or north versus south, but does my hon. Friend agree that we must consider more nuanced geographical and socioeconomic factors, including those of communities in remote coastal areas such as Cornwall, whose characteristics differ substantially from inland rural communities on issues such as non-resident population, the cost of beach safety, the ability to attract construction workers and, of course, a massive challenge with housing costs?

I entirely agree with my hon. Friend. Indeed, the requirement for bespoke interventions is the thrust of the latter parts of my speech.

Whether places such as Bacup feel the benefit of Government interventions is a test for whether we are delivering growth for all. The last Government failed spectacularly in this challenge and, if we are to avoid the same fate, we must do things differently.