Commons statement on Stronger Towns Fund - Mar 4

With permission, Mr Speaker, I would like to make a statement on the work the Government are doing to support our towns.

 

Last week, my right hon. Friend the Prime Minister informed this House that the Government would launch a new fund to help our towns to grow and prosper. Today, I am delighted to confirm further details of our new stronger towns fund—a £1.6 billion fund in England, between now and 2026, to help our towns to grasp the opportunities available to them in the years to come. The British people, supported by the balanced, long-term approach taken by this Government, have worked hard to rebuild the economy after the debts we inherited in 2010. As a result, we have seen strong and consistent growth, but we want to make sure that the benefits of that growth help to support towns across the country. The country voted for Brexit—communities expressing their desire to see change in their local areas. That must be a change for the better, with more opportunity and greater control.

 

It is important to remind all Members that as we move to support our nations and regions to help to take control of their own economic destiny, we do not start with a blank slate. Since 2010, seven city regions in England have elected metro mayors, with an eighth to follow in May. We created the local growth fund and devolved it to local enterprise partnerships across England to invest in their priorities for growth. We have agreed, jointly with devolved Governments and their local authorities, city and growth deals, including in Cardiff capital region and in Glasgow and the Clyde valley, with billions of pounds of additional funding. Our modern industrial strategy sets out a clear plan for the future that puts places at the heart of our ambition to create an economy that works for everyone.

 

But we know there is more to do. That is why we are in negotiations with other parts of the UK on more deals, including in Belfast and in Derry/Londonderry. It is why we are agreeing local industrial strategies with all places in England to get, for the first time, a real, long-term sense of what their local economies could look like in 30 years’ time. Our new stronger towns fund will build on that approach and extend our principles of devolution further, out to the towns that our success was built on. Through this, we will ensure that we spread opportunity more widely so that every community can benefit from our economic prosperity. It will be used to create new jobs, help to train local people and boost growth, with communities having a say on how the money is spent.

 

Today, I have published notional allocations of £1 billion of the fund. I have allocated that amount based on need. I have looked at the relative productivity, income and skills levels, and targeted more funding to those places with levels that are lower than the average, ensuring that local towns can access the funding needed to support productivity growth. Given that we all know that pockets of deprivation exist even in our most successful local economies, I have made sure that we take into account such very localised economic conditions. We will work with local areas to explore town deals that unlock local potential, investing in places and investing in people.

 

Today, I can therefore confirm initial allocations of £583 million to towns across the northern powerhouse, £322 million to those in the midlands engine, and £95 million across the south. The remaining £600 million will be invested following a competitive process that I invite all towns to take part in. I will publish a prospectus, which will include further details of the process, and I am keen to encourage high-quality, ambitious bids.

 

The message today to all Members who serve our towns is that we want those who know these places best—community leaders, local businessmen and women, civic leaders and others—to begin to think about the investments that could build on their heritage, improve productivity and boost the life chances of all their people and to bring those into a coherent plan that sets out a positive vision that people living there can rally behind and play a role in making happen.

 

As a Government, we have set out the value of investing in infrastructure, people, business and ideas in our industrial strategy, and we want each place to tell us the balance between those priorities for their town. We also want our local institutions to be involved. No one knows towns better than the local councils that serve them, and we want to ensure that local enterprise partnerships and mayoral combined authorities take a leading role. The Business Secretary and I are working with them on the development of local industrial strategies across England. LEPs and MCAs should play a guiding role to ensure that the plans of individual towns across a functional economic area are joined up, so that the overall strategy is greater than the sum of its parts. After all, we know that the success of many of our towns is intrinsically linked to the success of those around them.

 

Today’s announcement is also about our commitment to the whole Union. The Government will seek to ensure that towns in Wales, Scotland and Northern Ireland can benefit from the stronger towns fund. This will build on the success of our city and growth deal initiatives. Today, we extend our approach to devolution and make a new offer to towns and the millions of hard-working people who live in them to set their own futures.

 

Finally, I want to impress on the House what the prize at stake is: people coming together, the public and private sectors working with their communities to set out what their towns can be if everyone pulls together and works together, and the steps it will take in the short term to make that vision happen. The stronger towns fund is this Government’s offer to help make that become a reality.

 

My right hon. Friend the Member for Harlow (Robert Halfon) is spearheading plans in his constituency, and other towns, such as Blackpool, are bursting with ideas. So many people who care so much about the towns in which they live are passionate to see that their potential is fulfilled, harnessing the strength of place and identity and unlocking the potential of all parts of our proud United Kingdom. I share that ambition and am intent to see that, as we look to the future, all parts of our country play their part and no one is left behind. This fund is part of helping to achieve that, and I commend this statement to the House.

I thank the Secretary of State for advance sight of his statement, but we should call this out for what it is. This supposed funding boost is a pittance that will do little compared with the billions that his Government have already cut from our local communities. It will do little to reverse the damage that they have inflicted in each and every region. The reason that many of our towns are struggling is a near decade of politically imposed cuts, including to council funding and public services, by this Conservative Government. No one should be hoodwinked by such a shameful and pitiful attempt to gain support for the Prime Minister’s botched withdrawal agreement.

 

The fact is that between 2010 and 2020, councils will have lost 60p out of every £1 that the Government provide for services. Why has the Secretary of State cut 60p in every £1 from local government? Why did he not announce a reversal of that cut today, considering that it has left local services facing a funding gap of £3.2 billion? By 2025, the gap facing our local councils will rise to £7.8 billion.

 

If that was not bad enough, at a time when the Government should be reinvesting in our most deprived areas, they are instead cutting them even harder. Nine of the 10 most deprived councils in England have seen cuts of almost three times the national average. With such policies, does the Secretary of State believe that his party is truly showing itself to be the party for the few and not the many, or is this, as many of us suspect, a thinly veiled effort to mask its near decade of failure?

 

The Secretary of State says that he has taken deprivation into account when considering the allocation of this fund. That is baffling, because earlier in oral questions he again refused to say that deprivation would be included when considering the local government settlement. Why is deprivation rightly included in this fund but not the fair funding formula review? He mentioned Blackpool, yet Blackpool—the most deprived area in England—has seen a cut in spending power of more than £45 million this decade. That is more than the £40 million a year that the entire north-west of England will get from this fund.

 

Compared with the cuts that the Conservative Government have inflicted on our local communities across the country, this funding announcement is a drop in the ocean. We have seen cuts in spending of £7.3 billion over the past decade as a result of nine years of austerity. Even if we are being favourable to Ministers, the Government’s enticement is £5.7 billion short of the cuts that they have already inflicted. It is £434 million short of the damage they have caused to the east of England; £405 million short of the damage they have caused to the east midlands; £505 million short of the damage they have caused to the north-east; £1.18 billion short of the damage they have caused to the north-west; £353 million short of the damage they have caused to the south-east; £273 million short of the damage they have caused to the south-west; £709 million short of the damage they have caused to the west midlands; and £735 million short of the damage they have caused to Yorkshire and the Humber. What does the Secretary of State have to say to local people in regions for which this money still leaves a massive shortfall of hundreds of millions of pounds?

 

The funding promised by the Secretary of State over the next seven years does not even get close to matching the amount that regions have received from the European Union over the last seven years through European regional development and social funding. This package is £642 million a year short of the money that English regions would have received, and that is despicable.

 

This announcement is inadequate and confused. Why is £600 million unallocated? Why is there no clarity at all about where the money will go and on what? The Secretary of State talked about other parts of the United Kingdom. Will this money be distributed through Barnett consequentials, or will the Ministry of Housing, Communities and Local Government be given a new role? What will the allocations to Scotland, Wales and Northern Ireland be? Why did No. 10 not know what period the fund was for this morning, only for it then to be clarified that it is a long period of seven years?

 

There is still time for Ministers to reconsider the cuts to councils. I ask the Secretary of State to do so, and to do so immediately, because the danger for us all is that our communities will continue to decline if they do not get the proper support they need. It is time for a Government that will give our towns and communities the funding, resources and support they need to recover—one that will act genuinely in the interests of the many, not the few.

I thank the hon. Gentleman for his comments. He sets out a narrative in relation to the savings that councils have had to make, but he ignores the fact that the last Labour Government had already set in train cuts to local government. The idea that cuts would not have had to be made by any incumbent Government is simply not a reflection of the reality.

 

The hon. Gentleman sets out various points in relation to the benefits attached to different communities and investment into regions, but he ignores the £9.1 billion of local growth funds to local enterprise partnerships through three rounds of competitive growth deals, the investment of £3.4 billion for the northern powerhouse, £1.9 billion for the midlands, £700 million for the east of England, £2.1 billion for London and the south-east and £970 million for the south-west. He does not mention the coastal communities fund, the home building fund and the housing infrastructure fund, and he does not mention the national productivity investment fund, which is all about investing in our regions and our communities, and ensuring that we grow productivity and all communities are able to benefit further.

 

However, this is about towns, as I have indicated. It is about the towns that need to see a sense of identity and sense of growth, as I set out in my statement. Yes, on the allocation of £1 billion, which the hon. Gentleman asks me to set out, there are notional allocations to the particular regions, and we want to see bids from towns, working with the local enterprise partnerships, coming through in a very positive way. Equally, as I indicated in my statement as well, we want to ensure that we reflect on the fact that towns in other areas may not necessarily fall within those neat parameters. We therefore want to see bids come in from towns across the country for deals based on their ability to set out their bright, positive future.

 

The hon. Gentleman listed a number of figures in relation to, as he set it out, cuts. I would say to him, equally, that he well knows that the local government financial settlement this year has a real-terms increase in the money going to the core spending power of local councils across the country. He asks what we can point to in other areas. Let us look at the changes in employment that this Government have seen: there has been a 5% increase in the north-east, 7.1% in the north-west, 7.7% in Yorkshire and the Humber, 6.8% in the east midlands, 10.1% in the west midlands, 9.1% in the east, 22.4% in London, 7.5% in the south-east and 8% in the south-west. This Government are growing the economy and seeing the benefit in jobs and prosperity, and we want to take this to the next level.

 

The hon. Gentleman highlighted the devolved Administrations. We will seek to ensure that towns in Wales, Scotland and Northern Ireland can benefit, building on the success of the UK Government’s city and growth deals. We will confirm in due course the additional funding we will provide to reflect this new funding for England. This is about the determination we have for our towns—those places at the heart of our growth, our identity and our sense of who we are as a United Kingdom. I am sorry if he cannot see that, but it is actually about investing in the future, investing in our communities and seeing the bright, positive future ahead for our United Kingdom.

This is an excellent announcement, and I particularly welcome what the Secretary of State has said about money for the midlands engine. He said that any town may apply, and given the very serious structural change going on in the town centre of the royal town of Sutton Coldfield, resulting from the decline in retail and the need for a reconfiguration in what we do, will he confirm that the royal town of Sutton Coldfield will be able to apply? He mentioned that there will be challenge funding and competition for the funds, which is very welcome, and he also said that the most local element is the one closest to those it represents, so will he confirm that, with the largest town council in the country, the Royal Sutton Coldfield Town Council will be able to apply for this challenge funding?

I welcome the pitch my right hon. Friend has made for Sutton Coldfield. I do want to see ambitious applications coming in from towns across our country. That is why, as he will no doubt note, we have made a provisional allocation to the west midlands of £212 million from the main £1 billion fund, but, equally, there is the ability, on the competitive element, to bid for the £600 million, too. I want to see really ambitious proposals coming forward, because this has the potential to transform the future of a number of our towns. By having such an ambition, I know that we can achieve that.

Another day, another tawdry bribe by this Government to distract and to grab headlines from their failing Brexit plans.

 

First, I want to ask the Secretary of State whether this money will be Barnettised for Scotland, and when can we expect to receive that money? Every single—[Interruption.] Mr Speaker, I want to know whether this will be Barnettised because every single city deal so far has seen Scotland short-changed, with more money going in from the Scottish Government than from the UK Government time and again.

 

I do not grudge any town any investment, but this is simply a bauble on the bare Christmas tree of austerity. The £1.6 billion announced today pales into insignificance compared with what the EU funds would have put in. The Conference of Peripheral Maritime Regions estimates that, over the same period, the UK would be due €13 billion. The £33 million for the south-west alone is only one Grayling.

 

The Secretary of State still cannot tell us anything useful about the UK shared prosperity fund—how it will work, whether it will be fully devolved to the Scottish Government to administer and whether its needs-based formula will apply to the money that he seeks to dole out. Is this another power grab? Will the funding levels for this shared prosperity fund be at the very least the same level that they are at now, because the Scottish National party will not accept one penny less?

 

We are getting into this Brexit situation, but Scotland did not choose Brexit, we did not choose this Tory Government and we do not choose to have this Tory Government rip us off time and again. We have seen Northern Ireland getting £1 billion un-Barnettised, and these are further funds going un-Barnettised, as far as we know. The CPMR says that Scotland would be due to receive €840 million in structural funding between now and 2027. Will the Government tell us exactly how much Scotland is getting and when we will get it?

As I have indicated already, in response to earlier questions, we will confirm the additional funding we will provide to Scotland, Wales and Northern Ireland to reflect this new funding for England.

 

The hon. Lady asks about the UK shared prosperity fund, which is separate from this; I want to stress that. We are committed to creating the new fund to reduce inequalities between communities across our four nations by raising productivity once we have left the EU. We will operate that across the United Kingdom. We have made a commitment that we will respect the devolution settlements in Scotland, Wales and Northern Ireland and we will engage with the devolved Administrations to ensure that the fund works for all places across our United Kingdom.

 

We will consult widely on the design of the UK shared prosperity fund. I recognise the importance of reassuring local areas on the future of local growth and we will also be consulting firmly with the devolved Administrations. We have repeated our commitment to respect the devolution settlement and we intend to commence discussions between Ministers of the UK Government and the Governments of the nations in advance of the consultation. The hon. Lady can have my assurance of that in relation to the UK shared prosperity fund. We are committed to do that.

I strongly welcome this post-Brexit dividend, which I am sure is the beginning of more dividend to come. My right hon. Friend kindly mentioned my constituency of Harlow, which, despite being a wonderful place to live, has significant deprivation and disadvantage. Will he confirm the timing and the mechanisms for applying for this grant, so that we can apply for regeneration and for our new hospital? Although the east of England gets £25 million, will he confirm the mechanism for applying for money from the extra £600 million fund that he has announced?

My right hon. Friend rightly makes the distinction between the two elements of the fund and the town deals that we want to see emerging from both of them. On the first element, we have allocated this on the basis of a number of different factors, but I will be publishing a prospectus—that is the next stage—to set out the application process and the basis for the applications we want to see coming through from the towns that can apply under the £600 million fund. We will be setting that out in detail so that towns such as Harlow, which I know he is so passionate about, are able to apply.

The Secretary of State will be aware that, if the UK were still a member of the EU after 2020, South Yorkshire would again be eligible for less-developed region status because its economy has fallen back against EU averages since 2014. If it were entitled to EU funding, South Yorkshire would receive £1 billion over seven years. So either his announcement today is totally inadequate, or he is going to promise that, under the shared prosperity fund, South Yorkshire will get exactly what it would have got under EU funding if we were still in the EU.

One of the things that would encourage investment in the right hon. Gentleman’s area is getting the devolution deal done in relation to South Yorkshire, Sheffield and the Sheffield city region, as he well knows. He makes an important point about the distinction between this fund and the UK shared prosperity fund, which will follow. Those are separate, and there will be a consultation on the prosperity fund and, indeed, the settlement of amounts in the spending review. There is more to come, so this fund should not be seen in isolation. It links into more funding and more structures that will support growth in all areas.

I commend to my right hon. Friend the “Transforming Nuneaton” project, which is very much designed to regenerate Nuneaton town centre and make it fit for the 21st century. A bid is going to be made for the future high streets fund. Is that compatible with the stronger towns fund so that further bids can be made?

There will certainly be some overlap with the high streets fund, so there is an opportunity for town centres and town deals to come together in this way, and there are different purposes that the high streets fund is intended to advance. There is potential to be transformative through the fund that we have announced and, indeed, the new stronger towns fund that I am announcing today.

I welcome the Minister’s understanding that, for decades, our towns have suffered from chronic under-investment and disrespect from national politicians. It is therefore frustrating to hear him talk about handing decision-making powers over this funding to local enterprise partnerships, which have enabled this city-centric model of decision making to persist for far too long. They do not understand our towns and they are not accountable to them. I urge him to make a commitment today to move those decision-making powers to communities and their local councils, which understand best what we need. If he is serious in his acknowledgement that our towns are proud, important places, he must trust us to make these decisions for ourselves.

I absolutely recognise the impassioned statement that the hon. Lady has set out on the significance of our towns. We see this as a partnership. Ultimately, those bids, those ideas, and those things that will make a difference in our towns, have to come from the community—from councils, businesses and civic leaders who can shape those ideas, make sure that those bids are competitive and ambitious, and deliver the transformation that she wants for her area and that I would want for her area too. We will work with this, and we will make it work so that towns are seen to have that strength, we get the deals in place and see the sort of thing that she is talking about.

Almost £1 billion has been allocated to the new stronger towns fund. When will we know when those allocations have been confirmed to individual communities?

There are two elements, as my hon. Friend will appreciate. The first element is the notional allocations that I have set out, and we will work to provide further detail in relation to the LEP allocations and the next steps on that. Then there is the prospectus that sits alongside the £600 million, which will allow people to bid. I anticipate that there will be different phases, because different towns and communities will need to build their plans and get their ideas together, but I will set out further details in due course.

Towns such as ours in Yorkshire are sick of losing vital services such as libraries, buses, community centres, jobcentres, courts and maternity units, and we need that investment. Our job growth has been half the level of job growth in cities since 2010, but the problem is that the Government are still cutting investment in councils that serve our towns. Analysis by the House of Commons Library this afternoon shows that the cuts in funding for councils covering Yorkshire towns over the next two years alone far outweigh any investment that our towns are likely to get from the funds that the Secretary of State has announced. Does he not accept that, unless councils have the investment and unless we get a fair deal on transport, rather than the rubbish one we get at the moment, we will still not get a fair deal for our towns?

For a number of reasons that the right hon. Lady has set out, I would expect her to welcome the allocation for Yorkshire and the Humber of £197 million, set out in today’s announcement, to allow towns to bid for that and to see some of those transformations, whether in transport or other aspects. I would gently underline to her that core funding growth for councils in the forthcoming year has increased, recognising a number of pressures that exist. I have spoken about other funds and, together with those, I see this as transformative. I hope that she and others can work with us to ensure that it has an impact in her community as much as anywhere else.

I welcome the fund, especially the funding for Yorkshire and northern Lincolnshire, as we prefer to call it. When I was Minister for local growth, I trotted up to No. 10 and pitched something very similar, but I was not as effective as the current ministerial team, so I congratulate them. I agree with the point made by the hon. Member for Wigan (Lisa Nandy). When I was responsible for the local growth fund—there were good reasons for it—I was frustrated by the fact that much of it was predicated on a city-centric model, so can we have an assurance this time that, important as investment in cities is on a sub-regional basis, this will absolutely be focused on our towns, and we will seek to work in partnership with things such as the coastal communities fund and the new future high streets fund so that we have a proper, joined-up policy in this regard?

I welcome what my hon. Friend has said on that join-up and on the potential that it offers between the different funds, and his emphasis on towns. Yes, the focus thus far has been on cities, which is why this is about setting out a different course, recognising that towns in many ways have been left behind. It is why we need to focus more on seeing the solutions at that level, where we can make a significant difference, and I look forward to working with him as we take that forward.

My hon. Friend the Member for Wigan (Lisa Nandy) and the hon. Member for Brigg and Goole (Andrew Percy) have made important points, which I am sure the Secretary of State will contemplate. Is he delighted by the cross-party support for this welcome initiative? In accepting the enthusiasm, including from the Labour Front Bench, will he feed back to the Chancellor that such is the enthusiasm of Members across the House for this idea, that if more moneys are put into the fund, that will be even more welcome?

I am grateful for the hon. Gentleman’s invitation. He makes an important point, because in some ways this transcends party. It is about how we reshape our towns, recognising that some have been left behind because of lack of investment from many, many Governments. This fund begins to reset that relationship, and there is almost a new sense of Unionism, with a strong sense of all communities playing their part. We should look positively at what the fund can deliver alongside other initiatives so that our towns are absolutely at the forefront.

Lowestoft is a town with a proud history that faces significant challenges, including deep pockets of deprivation. However, there is an exciting future in which Government can play a pivotal role in unlocking potential. My concern is that the money from the coastal communities fund is spread thinly around the coast, and the east of England is at the bottom of the table of regional beneficiaries of this fund, so resources will not be available to unlock that potential. Can the Secretary of State allay my concerns?

What I would say to my hon. Friend in relation to Lowestoft and the work of the coastal communities fund is that today’s announcement has two elements: the £1 billion—he references the £25 million notional allocation to the east of England—and the £600 million for competitive bids. Lowestoft should be positive, put in its submission and get the concept of its own town deal together, so we can pool resources, through the coastal communities fund, the future high streets fund and this fund, and it can have a bright, positive future.

We were promised that Wales would not lose a penny if we left the EU, but the grubby money offered to the UK’s most deprived areas is petty in comparison to the £2 billion Wales currently receives from the EU over the 2014-20 cycle. If this is the pork-barrel future of UK politics, Wales is better off out of it. Will this fund be Barnettised, or will the Secretary of State admit that this money is indeed all about need—not economic need or social inequality need, but the Prime Minister’s need to tout for votes for her deal?

We are looking to the UK shared prosperity fund to replace the European structural investment funds that the hon. Lady references. The Government have already guaranteed the full 2014-20 allocations, providing assurance to all parts of the UK in all scenarios. The UK shared prosperity fund will follow. As I indicated, we will confirm in due course the additional funding to be provided to Wales, Scotland and Northern Ireland to reflect the new funding for England.

I welcome the establishment of the stronger towns fund. Will my right hon. Friend assure the House that towns across the midlands and the north, from Cleethorpes to Coalville and from Accrington to Ashby-de-la-Zouch, will have an opportunity to benefit from this fund?

Yes. My hon. Friend will have heard about the allocations already set out as part of today’s announcement. It is that sense of ambition, that positive sense of what can be achieved for our towns, that lies at the heart of it and why I believe it has the potential to be so transformative.

The Secretary of State said that towns such as Blackpool are bursting with ideas. Unfortunately, his funding for such towns is wholly inadequate. His seven-year itch, if I can describe it as such, will deliver £280 million to the north-west. By my reckoning, that is £40 million a year for the whole of the north-west. Blackpool, as my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) said, has lost half a billion pounds in council funding cuts from this Government and their predecessor since 2010. So how can he possibly sit there with a straight face and say that this is a transformative process? I think the old saying, “The louder he protested his honour, the faster we counted the spoons” is probably more appropriate.

I am sorry that the hon. Gentleman does not reflect the work that has been going in through the coastal communities fund, of which Blackpool has been a real beneficiary, and the work we are looking to take forward to give a sense of a new deal for Blackpool. Indeed, he highlights local government finance, while ignoring other sources of income for councils—business rate growth, council tax and so on. When we look at the fund I am talking about today, together with those other funds, we can see the bright positive future I want to see for Blackpool, as I want to see for towns up and down the country.

I thank my right hon. Friend for his statement. I note that at the beginning he described the fund as a £1.6 billion fund in England, but of course my ears pricked up at every mention of Scotland. When he came to the sentence,

 

“The Government will seek to ensure that towns in Wales, Scotland and Northern Ireland can benefit from the stronger towns fund”,

 

my ears truly did prick up. May I ask my right hon. Friend how?

I recognise the need for towns across our United Kingdom to benefit and to see that positive sense of what can be achieved, in many ways applying the lessons learned from our city and growth deals initiative. It is that type of approach that we intend to pursue further. As I indicated in response to other questions, recognising that this involves new funding for England, we will set out details on additional funding for Scotland, and how that will benefit towns in Scotland and across the whole of our United Kingdom. That is the positive future we want to see for my hon. Friend’s constituents and all constituents across the UK.

It should not have taken a referendum and Brexit to get the focus on towns we are hearing about today. I was proud to take part, with Labour colleagues, in two Westminster Hall debates on culture in our towns and transport in our towns, both of which are vitally important. From my end, it is really important that this fund does not just morph into every other fund that currently exists and that the local enterprise partnerships end up as the sole arbiters of whether bids can go forward. It is also important to recognise that within every big town there are many smaller towns and communities. I want to know and want to be reassured that there will be a voice not just for elected representatives, businesses and so on, but for the ordinary, everyday people who do not feel that the projects at the end of their street are being listened to and attended to. Will the Secretary of State guarantee that in those circumstances match funding will not be necessary for them to secure a bid?

The right hon. Lady makes very powerful and important points about the role and voice of communities, the recognition that there are different towns of different sizes and how they need to be connected into this, and the role of Members of Parliament. I want grassroots communities to be properly engaged and involved in helping to shape the deals. That is the challenge and the approach I adopt, so that we do not slip into the sort of approach she rightly challenges those of us on the Government Benches on about how we can make a difference. I am willing to work with her, and Members across the House, to ensure that we reflect the vision and passion she sets out and that we get this right.

The Secretary of State’s announcement today has caused a great deal of concern in Cornwall. We were told that the allocation would be based on need and deprivation, yet Cornwall, an area that has some of the lowest wages and productivity and some of the highest levels of deprivation in the country, has been put in with the south-west and received one of the lowest allocations. Will the Secretary of State please explain why Cornwall has had such a low allocation, and will he reassure the people of Cornwall that the criteria used for this allocation will bear no relation to the criteria used for the shared prosperity fund when it replaces European structural funding once we leave the EU?

I can give that assurance to my hon. Friend. The UK shared prosperity fund is a completely different process and we look forward to consulting in detail on that. I recognise the challenges Cornwall faces. I have a really positive sense of what Cornwall can be from the exciting projects my hon. Friend showed me on my visit to parts of his constituency last year. The notional allocations have been set out based on productivity, income, skills, deprivation and the proportion of the population living in towns, with all those criteria weighted together. I want him to remain ambitious. I am ambitious for Cornwall: what it can do, the opportunities that are there, and how the £600 million, as part of the overall fund, provides huge potential, alongside all the other great initiatives that I know are happening in Cornwall.

The north-east will get £105 million, which means £15 million a year over seven years. That is £5 per person each year. Under the European system, we would have received €500 per person each year. At the same time, Durham County Council has had cuts of £212 million. This is totally inadequate. Furthermore, the Secretary of State’s practice of having a packet for this and a packet for that, and a fund for this and a fund for that, means long-term planning is impossible. The only productivity he is increasing is the productivity of his officials in increasing the number of press releases they deliver.

I am sorry that the hon. Lady has not recognised that the north-east has had the highest allocation per capita of any part of the country and therefore the recognition that has been given in that way. I do not accept the challenge she sets out in terms of long-term funding arrangements. We still have the UK shared prosperity fund to come, which talks to some of the replacement for the European funding she mentions. The assembly of the different funds together does allow that opportunity to be transformative. I want her to realise that, recognise that, and work with us to make that happen for her towns as well.

I welcome the Secretary of State’s announcement, which builds on the Prime Minister’s commitment from her first day in Downing Street. Will he clarify whether the projects that are currently being carried out in Cleethorpes through the coastal communities fund and the Government’s commitments made through the Greater Grimsby town deal can be enhanced by this additional funding?

My hon. Friend highlights the contribution of the Greater Grimsby town fund and the work that the coastal communities fund is delivering for his constituents, as well as the potential for this new fund to add to that. Precisely that sense of what the existing funding—through the coastal communities fund and the future high streets fund—is able to do to be transformative is the reason I hope colleagues will get behind it.

To put this rehashed, re-mashed £1.6 billion into perspective, Wales alone has received £4.5 billion in funding from Europe since 2000. Will the Secretary of State explain exactly how much Wales will benefit from this funding announcement? Does he agree, to draw upon some porcine sayings, that this is pork barrel politics at its lowest and that the good people of Wales will see this pig in a poke a mile off?

No. Again, I underline the contribution that the UK shared prosperity fund will have, and we will set out the details of the contribution for Wales, recognising that we want all parts of the UK to benefit.

While I welcome the aims and ambitions of the fund, will the Secretary of State outline why he is unable to come to the Dispatch Box tonight to explain how much money will be available for Scotland and to towns in Moray? When will he do that and how much will be available, because that is extremely important for the whole of the United Kingdom, including Scotland?

I commit to my hon. Friend to see that we set out that detail as soon as possible. I want to ensure that the fund benefits all parts of the United Kingdom and that we learn the lessons about the benefits from the Government’s city and growth deal initiatives. We will set out that additional funding, recognising that England is getting new funds from this and that Scotland will, too.

My town of Barnsley has seen its budget cut by 40% over the last nine years—nearly £700 per person. Does the Minister honestly think that today’s announcement makes up for the huge cuts that the Government have made to my town?

Again, I highlight the South Yorkshire devolution deal, which can bring additional investment into the hon. Lady’s community. I have highlighted a range of other funds that are available and that can be benefited from, such as the future high streets fund to transform high streets. I encourage her to get behind those funds and deals and to see that her area is investing and putting applications in to help to make the difference for her constituents.

I welcome the £212 million that has been allocated to the west midlands, but will the Secretary of State reassure my constituents that Birmingham and the urban conurbations will not gobble up most of that money and that market towns such as Shifnal, Newport and Wellington in my constituency, working with the Marches local enterprise partnership, will see a lot of this funding, not just the rump of it?

That is why this is a town-based approach, not a city deal of the kind that we have seen before. I recognise how that has benefited our cities, but we need to ensure that our towns benefit, too. It is why that lies at the heart of the fund’s structure and my hon. Friend should be confident about the towns in his area being able to make those bids. I hope and want to see them succeed.

It would be disingenuous of me not to welcome the Minister’s statement, but it would also be disingenuous of me not to say that I am a wee bit concerned that there are no figures at all on what will be given to Scotland and Wales. Will the Minister therefore tell us two things? First, in terms of coming back to the House and informing us about the moneys for Scotland and Wales, will he make sure that the Governments of Scotland and Wales are told first? Secondly, and this is important for Members for English constituencies, last week the Government gave Northern Ireland £140 million outside of the block grant. Will that be replicated in England, Wales and Scotland, and if not, why not?

I am sure that the hon. Gentleman will be able to ask others about the situation in Northern Ireland. We will ensure, in coming back to the House, that Members of the House are informed about additional funding for Scotland and Wales, and equally, we will communicate that to the devolved Governments.

I welcome the fact that over half of the first £1 billion of stronger towns funding will come to the north, but will the Secretary of State please consider how small towns such as Middlewich, Sandbach and Alsager in my constituency could bid directly for funding, not just through the filter of a large principal authority or a LEP, because only then will local townspeople really have confidence that their grassroots needs will be considered by the funding decision makers?

We are reflecting on precisely that point in terms of the separate elements of the fund—the £600 million—and the prospectus that we will produce to ensure that areas are able to make those sorts of bids. Recognising the challenges of different towns and areas and being able to feel the sense of opportunity is why we have sought to break the fund down in the way that we have.

I like the Minister, but I simply cannot recall a ministerial statement that has angered me more. My constituency, the Rhondda, is one of the poorest in the land. My council, because of the Government’s cuts to the Welsh Assembly grant of several billion pounds over the last few years, has had to close schools and libraries. The Government have closed the courts in the constituency and we have some of the lowest wages of anywhere in the country. When he suddenly turns up having discovered the magic money tree, having lectured us for years about its non-existence, I frankly feel furious that we are now meant to feel awfully grateful that we might have a few crumbs from the table. The worst of it is that today, he cannot even bring himself to say how much money is going to go to Wales—probably not a penny, or is he going to say now, “Yes, you are going to have £5, maybe £20, maybe £100”? Come on, tell us how much we are going to get in Wales.

I am sorry to anger and disappoint the hon. Gentleman—I have a huge amount of respect and admiration for him and the way that he conducts himself in the House. I recognise that desire to see towns in Wales—in his constituency—being able to benefit from the stronger towns fund. I promise to come back to this House to provide the details in relation to Wales, and hope to see him in slightly better humour on that occasion.

Stoke-on-Trent is a city that is made up of six towns, quite uniquely in our country. Does my right hon. Friend agree that all the six towns that make up Stoke-on-Trent, but especially Longton and Fenton in my constituency, are exactly the sorts of places that must benefit from this funding?

I recognise the picture that my hon. Friend paints, and therefore the opportunity that this fund provides. We want to see people being ambitious and really positive about how funding can be transformative and can make that difference, and I look forward to continuing to work with him as we take the fund forward.

I welcome the Government’s conversion to regional funding, but the amounts are derisory by comparison with what has been lost through austerity and economic neglect and what will be lost if the Tory Government’s no-deal/bad-deal Brexit goes through. They refuse to give any details of the shared prosperity fund that the Secretary of State has mentioned a few times, which shows that by comparison with the European Union the Government are less transparent and open—we know that under European Union funding, we would have got up to £1 billion in the north-east. Will he at least say that the north-east would be better off with European Union funding?

I have already highlighted the per capita funding the north-east will receive through this fund. We will consult soon on the UK shared prosperity fund—the funding for that will need to be settled through the spending review—and set out the details. We recognise the need for areas such as the north-east to be able to flourish and prosper. I hope the hon. Lady will recognise what this fund delivers and that there is more to come beyond the European structural investment fund guarantee through to 2020. We should look beyond that to the UK shared prosperity fund.

Somerset has some of the most deprived towns in the south-west, and they really need strengthening, so residents will be a little confused by the numbers in today’s announcement. I welcome the idea that the shared prosperity fund will be calculated differently, but given that productivity is similar in the south-west and the north-west, that income levels are not so different and that about two thirds of my constituents live in towns, it is slightly odd that the north-west gets nearly 10 times as much money. Why is that?

We have sought to assess the notional allocations based on the various factors I have spoken about. I recognise that for some people this will be positive and for others it will not be so welcome, but I underline to my hon. Friend the reason we split the fund into two parts and the benefit that his towns should enjoy through the £600 million of separate funding. I encourage him to ensure his towns make a bid through that process.

Batley and Spen, like many towns in the north, is sick to death of being bypassed and left behind—banks closing, theatres closing, cinemas closing, Sure Starts closing, and its council, Kirklees, having a 60% cut since 2010—so I was really excited this morning to look at this fund, until I saw the detail. We have nearly £700 million in European regional development and social funding for 2014-20. Over seven years, that is £97 million a year. This allocation—£197 million—equates to £28 million a year, which is a loss of £70 million in spending power and allocation. The Minister also spoke about Yorkshire and mayors. He had the opportunity to give us loads of money by listening and agreeing to the unequivocal desire for a One Yorkshire. He had the chance to give us that money, but he kicked it out and said no. With the greatest respect, we will not doff our cap for crumbs from the table. We want a fair slice of the cake.

I do not want the hon. Lady to doff her cap in any way, shape or form. This fund is part of a package of measures that we will be bringing forward. That is why I have highlighted the UK shared prosperity fund. She talks about European money. That fund is part of the replacement for those funds post-2020. I recognise the passion and ambition and the sense of identity of people across Yorkshire, which is why I had that meeting at the end of last week with Yorkshire leaders. I cannot take the Yorkshire deal forward in the way that she and some of her colleagues may wish, but I certainly have that ambition for Yorkshire, which is something we discussed positively last week.

Boston and Skegness are proud and ambitious towns that, frankly, have been frustrated because we have not been spending money like this for many years on our great towns. I welcome enormously what the Secretary of State is doing today. He is extoling the virtues of a plethora of different funds. It should be for towns to come up with their own ambitions and perhaps for the Department to help them in saying how best they can be put together and allocated from different pots of money.

That is why we want to see the development of what I might categorise as town deals, whereby we can bring different funding streams together to support that positive sense of how towns can fulfil their potential. This firmly forms part of that, but, as I have indicated, there are other sources of funding, and bringing those strands together will add that further leverage. I look forward to working with my hon. Friend as we seek to establish more of those town deals.

The biggest challenge facing many towns, including Cumbernauld, is the impending  loss of a major employer: Her Majesty’s Revenue and Customs. Some 130 offices are set to be closed. If the Government want to support towns, surely HMRC must ditch its plans to move tens of thousands of good-quality jobs away from those very towns and into city centres.

The hon. Gentleman has made his point about HMCR, and I will ensure that it is relayed to the appropriate Treasury Minister.

Cheltenham has areas of relative affluence but also pockets of intense deprivation. Does my right hon. Friend agree that any applications must be assessed against the circumstances that prevail in individual neighbourhoods, rather than the town overall, which might lead to an artificial assessment?

My hon. Friend makes an interesting point. As we form the prospectus for the £600 million element of the fund, it is precisely these factors that we will weigh and consider to ensure it has the impact we want it to have.

My local council, Rochdale, has had its funding cut by nearly £200 million since 2010, so why does the Secretary of State think that £281 million for the entire north-west—a drop in the ocean compared with the cuts my council has had to make—offers a sustainable plan to strengthen the towns of Heywood and Middleton?

As I understand it, the hon. Lady’s constituency benefits from the Greater Manchester devolution deal and the investment it brings to her area. She is confusing different aspects. I have already spoken about the increase in core funding for councils across the country in the coming year. The particular aspect of this fund is its ambition for towns. I want to see towns in her area and across the country harnessing their potential and seeking to make that difference.

I welcome the Minister’s stronger towns fund. The north-east of Scotland raises an extra £100 million of local taxes a year, but local communities do not see it. Pitmedden, Insch and Huntly, to name a few, would welcome the opportunity to bid for Her Majesty’s Government’s funds. Can the Secretary of State confirm that Scottish towns will get that opportunity?

It is precisely that intent that I have set out. We want towns in Wales, Scotland and Northern Ireland to benefit from the stronger towns fund, building on the success of the city and growth deal initiatives, as I have indicated, and I look forward to continuing that conversation with my hon. Friend.

I join hon. Members from Scotland and Wales across the House in being disappointed at today’s statement. The Secretary of State says that the Government will communicate soon what the deal will be for the devolved nations. Does he realise how insulting today’s statement is? Wales is not an add-on or an extension of England. I hope he realises how upset we all are.

I share the hon. Lady’s perspective. Wales is no add-on. I want all parts of our United Kingdom to benefit from the funding arrangements, building on the success of the city and growth deal initiatives, which have benefited all parts of our United Kingdom. We want to get this right and to work carefully with colleagues. I recognise her frustration, but I also underline our ambition and desire to fulfil that for her and Members across the House.

I welcome the focus on towns rather than cities. In that spirit, will my right hon. Friend consider allocating a proportion of the east midlands’ £110 million for the regeneration of the old Stanton ironworks for housing and industrial use, which would bring skills and jobs to my constituency?

We have set out the relevant notional allocations for the east midlands. I hear what sounds like an interesting and ambitious plan that my hon. Friend has for her constituency, but it must be taken to the next phase and the bid must come together, and I am sure that that will involve working with the local enterprise partnership.

I thank the Secretary of State for the commitment that he has shown. He said that Northern Ireland would benefit from the stronger towns fund. My constituency contains four major towns: Newtownards, Cumber, Ballynahinch and Saintfield. Those four strong towns would like to make themselves stronger. When will that happen? When can they apply for these moneys?

I know how beautiful the hon. Gentleman’s constituency is, because I have had the privilege of visiting it a number of times, and I recognise his ambition for the towns in his constituency. As I have said, we are seeking to finalise the arrangements for Wales, Scotland and Northern Ireland, and I will report back to him to give him a sense of how his towns can benefit.

Too often in the past, money transferred from the United Kingdom Government to the Scottish Government has not reached the communities and public services that Conservative Members would like it to. Will the Secretary of State confirm that my local authority, Scottish Borders Council, can apply directly for funds from this pot of money?

As I have said in previous answers, we want to build on the success of the city and growth deal initiatives, which have cemented our approach to the idea of people working together and the bigger picture of how benefit can be felt at community level. That is the approach that we are taking to the next stage and this additional funding, and my hon. Friend’s constituents will be able to feel the benefit.

The Secretary of State’s allocation of just £33 million over seven years for the 5.4 million population of the south-west is insulting. The far south-west and Cornwall in particular contain some of the most deprived communities in the country. The Secretary of State has said that this fund, and the shared prosperity fund, will be allocated on the basis of need. What faith can the south-west have in that when we receive one of the highest levels of needs-based EU funding and one of the lowest levels of need-based Government funding?

As I said to my hon. Friend the Member for St Austell and Newquay (Steve Double), the UK shared prosperity fund is different. Let me also point out that this fund includes £600 million for competitive bids. I know that the south-west has benefited from the coastal communities fund. I encourage the hon. Gentleman to make applications and see towns across the south-west benefit.

Another one from the south-west, Mr Speaker. I am proud to represent Paignton and Torquay, which are seeing new investment but clearly have some years of decline to tackle in the town centres. Can my right hon. Friend reassure me that the new fund will work in conjunction with, for instance, the coastal communities fund, and could potentially lay the ground for town deals for such places as Torquay and Paignton?

Absolutely. I can give my hon. Friend that assurance. Towns such as Paignton and Torquay are great places, but they want more to be done for them. We have the opportunity to consider options such as town deals so that we can advance the agenda and my hon. Friend’s constituents can feel the benefit.

It is clear that the level of the stronger towns fund—whenever it is announced for Scotland—will not make up for the fact that Scotland is now in danger of losing £840 million in EU structural funds between 2020 and 2027. In response to my question to the Prime Minister on 5 December, she told me that a consultation on the UK shared prosperity fund, which is supposed to replace EU structural funds, would be held by the end of 2018. Given the importance of the EU funds to my constituency, will the Secretary of State update the House on the progress of that consultation?

I can say that we have already begun to engage with officials and external stakeholders in the devolved Administrations and discuss their experience of current European funding programmes and priorities for the design of the UK shared prosperity fund. We have repeated our commitment to respect the devolution settlement, and we intend discussions between Ministers in the UK Government and the Governments of those nations to begin before the consultation. Obviously we will take a specific approach in the case of Northern Ireland, in the absence of a sitting Executive, but we are advancing the work on the prosperity fund, and I can assure the hon. Lady that we will work with the Scottish Government in that regard.

It is welcome that extra money is being provided for communities in the east midlands. In Corby, 64% of people voted to leave the European Union, and there is a strong desire to see a new enterprise zone in the town, not least because the last one, under the Conservative Government in the 1980s, was such a success. Will funds be made available to support such projects?

I recognise my hon. Friend’s ambition for Corby, and for an enterprise zone like the one that was there previously. I shall be happy to discuss the details with him. We want towns to feel able to come forward with bids, and we are looking into the various transformative services, skills and jobs that will feature in the new economy that we want to create, along with a sense of ambition for growing enterprise and business. I am sure that this fund can offer that potential to Corby, and to other towns throughout the country.

Most Members can welcome a bit of extra cash for their areas, but we cannot avoid the context of huge cuts in local government funding. Nor can we avoid the context of a possibly imminent Brexit, which makes it difficult to believe that today’s announcement has absolutely nothing to do with that. My question, however, is this: if the Secretary of State can produce indicative allocations for England, why on earth can he not do the same for Wales?

In response to the hon. Gentleman’s first point, let me underline the Prime Minister’s commitment during her first days in office, when she spoke of her desire to see a country that worked for everyone and where no one was left behind. The fund that we have announced today is very much part of that agenda, because we want all parts of our United Kingdom to benefit. I have already mentioned the funds for Wales, Scotland and Northern Ireland, and I promise the hon. Gentleman that I will report back.

My I press home the point made by my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont)? If this money is simply Barnettised, the Scottish Government will fritter it away on other things, just as they have done with the £92 million on Brexit preparedness, not a penny of which has made its way to any Scottish council. I am sure that, having received yet another real-terms cut from the Scottish Government in the latest Scottish Budget, East Renfrewshire Council will be delighted to be able to bid for the money directly.

I recognise my hon. Friend’s ambition for his constituents. We share that ambition. We want towns in Wales, Scotland and Northern Ireland to benefit. We want to get this right. We can build on the success of what we have seen from the city and growth deal initiatives in the past, and we want to strengthen that so that people throughout our United Kingdom can benefit, and can realise their passion for their towns and the potential of those towns.

The Secretary of State has linked this fund to Brexit. My constituency voted leave. As its name suggests, it consists of two towns, both of which contain significant pockets of deprivation. I should have thought that they were exactly the communities for which the fund was designed, but under the rules there is no guarantee that they will see a penny of it. If that comes to pass, will the Secretary of State be saying that he has learned nothing about the reasons why people voted leave, and about the idea that some areas deserve more opportunities than others?

This is about towns coming forward with bids and having a sense of ambition, and a sense of how the fund can be transformative and make a difference to people’s life chances. There is still the work in relation to the UK shared prosperity fund, so the hon. Gentleman is wrong to try to link the two. I look forward to working with him, and with other colleagues on both sides of the House, as the further work on the towns fund is advanced through the prospectus involving the £600 million, and I want to see ambitious bids come from towns throughout the country.

Bottesford, Kirton and Scunthorpe are all great towns, but they have all been badly affected by the cuts in Government spending in our area across a whole range of services since 2010. The money that is now being talked about is only a third of what is being cut from local government over the next two years, and there is a bidding culture as well. Sometimes the areas most in need of support have the least capacity to make bids; what is the Secretary of State going to do about that?

There is the increase in funding for local government for the forthcoming year, which I have already referred to, and the town approach to this fund is profoundly about communities being able to shape this agenda, with civic leaders, business and the community being able to set out their ideas. I have talked about my ambition for the fund for the hon. Gentleman’s constituents and for people across the whole of our country.

rose—

rose—

I call Douglas Chapman.

Thank you, Mr Speaker; it is like winning the raffle.

 

No doubt the Minister will be aware that many towns throughout the country need a leg up at this time, especially in the run-up to Brexit, but it appears that this deal is very much a case of “except for viewers in Scotland and Wales.” If the Minister is genuinely supporting Scotland and Wales, where is the detail, what discussions have taken place with the devolved Governments to date, what is the funding formula, will it be Barnettised, and, in short, where’s the beef?

As I have indicated, I do want towns in Scotland to be able to benefit from this. We are continuing our discussions on finalising the additional funding to go to Scotland and Wales to reflect the new funding for England, and, as I have also indicated, I will update the House.

With Seaborne Freight, with the channel tunnel fiasco, with no idea for Scotland, with no idea for Wales—maybe Northern Ireland has had its cash, we don’t know—this is the UK at peak banana republic; it is make it up as you go along at the Dispatch Box thrown in with the expense of bidding and the patronage of doling out the money.

 

The Secretary of State has missed a trick: had he announced this over 14 years rather than seven, he could have said it was £3.2 billion rather than £1.6 billion. Either way, it works out at about £20 million a year for Scotland, and to make it worse we in the islands have been waiting a long time for our islands deal, and the UK Government do not know which Department is dealing with it—is it the Treasury, or the Scotland Office? The towns of Castlebay, Daliburgh, Lochboisdale, Balivanich, Lochmaddy, Tarbert and Stornoway could surely do with a good bit of this cash, and the crux here is that England is not bidding for this cash; England is getting this cash. And Scottish Tories, who have got the mushroom treatment, have to decide whether they are Unionists or submissionists who are doing what they are told. So the long and the short of this, is will this money be Barnettised? Will we see our fair share, or is this just peak, zenith banana republic coming from the Dispatch Box?

I am sorry that the hon. Gentleman does not, it seems, have that sense of ambition that we have for Scotland through Brexit and beyond. I know that Members on his party’s Benches have a different perspective on Brexit, but I say to him that I do want the towns in his constituency to be able to benefit from that, and therefore while there is new funding coming for England, we are seeing that Scotland, Wales and Northern Ireland benefit from that in the appropriate way. As I have indicated to him and other hon. Members, we will come back with the detail of that funding. I want Scotland to see the positive vision and sense that I have. Even if the hon. Gentleman is looking to extend this out for 14 years, we want to see the benefit sooner than that.