Asked by
To ask Her Majesty’s Government what assessment they have made of
the report by the Centre for Policy Studies A Northern Big Bang:
Unleashing Investment in the North, published on 14 February.
The Minister of State, Home Office and Ministry of Housing,
Communities and Local Government () (Con)
The Government welcome the contribution made by the Centre for
Policy Studies report. Levelling up the north of England is a key
priority for this Government, and the coronavirus crisis has made
it more important than ever that the Government continue to drive
forward progress on our promise to deliver real, positive change
in the north.
[V]
I draw attention to my interest as the chair of the North of Tyne
Combined Authority inclusive economy board, as set out in the
register. It is rather shaming that the UK is the most
geographically unequal of the OECD group of 27 rich countries.
The Treasury’s historical approach to investment has widened
rather than closed the north/south divide. I want to press the
Minister on whether he agrees with the central thrusts of the
report: first, that levelling up will rely on the power, dynamism
and scale of investment which only the private sector can bring;
and, secondly, that the economic success of the north is too
important to the people who live there to be left in the hands of
those who do not. Do the Government accept that business as usual
simply will not cut the mustard?
(Con)
My Lords, we recognise the need to unlock private investment, and
the government investment is designed to do precisely that, with
the £4 billion levelling-up fund; but, equally, we need to
devolve decision-making closer to the people in the north of
England.
(Con)
My Lords, I congratulate the Government on their £4 billion
programme and support the aims of building back better, a green
industrial revolution and attracting global capital. Will my
noble friend comment on the possibility of using domestic pension
assets, of which there are hundreds of billions of pounds,
including in local authority funds, which are currently investing
only in gilts with extremely low returns and which could be put
to more productive use in such building programmes?
(Con)
My Lords, my noble friend is right that pension assets are an
important source of finance for investment in infrastructure. I
note that the CPS report proposes updating rules covering UK
pension schemes so that we can encourage investment in northern
infrastructure.
(CB) [V]
My Lords, although the paper is entitled A Northern Big Bang,
many of the problems described and the possible solutions
identified are as relevant to the Midlands as they are to the
north—a point the authors stress throughout the report. Does the
Minister agree that measures to level up our country are just as,
if not more, urgently needed in the Midlands as they are in the
north, and will he comment on what plans the Government have to
work with the Midlands Engine, the APPG of which I am co-chair,
in that regard?
(Con)
My Lords, I point out that the commitment to levelling up also
includes the Midlands. Earlier this month, my right honourable
friend the Housing Secretary met the Midlands Engine Business
Council and numerous business leaders to work on precisely how we
should drive forward the agenda to ensure growth in the Midlands
as well as in the north.
(Lab) [V]
My Lords, history shows that major industries, such as gas,
water, electricity, engineering, petrochemicals, airlines,
biotechnology, telecommunications, computers and medicines, were
built or rejuvenated by the state because the private sector
showed little appetite for the risks and investment. Does the
Minister agree that direct state investment is vital to secure
prosperity for the north? If not, why not?
(Con)
My Lords, we recognise the importance of direct government
investment, but we must also ensure that the £4 billion of the
levelling-up fund leverages in private sector investment. It is
those two working in harness that provides the solution.
(LD)
Attracting private investment to the north requires a functioning
transport system. Why are Ministers declining to listen to the
Northern Powerhouse Rail business case for substantial investment
across the north before they produce their own integrated
transport plan? What hope is there of the level of improvement to
the transport system—for example, the east coast main line, which
requires expanded capacity both south and north of Newcastle
essential to expanding the passenger and freight capacity of that
line?
(Con)
My Lords, I recognise the importance of transport in driving
progress and investment in the north of England. That is why
there has been £13 billion of investment—the largest of any
Government in history—between 2015-16 and 2020-21, and there is
now also a five-year intra-city transport settlement to ensure
the north gets the transport infrastructure it needs.
(Lab) [V]
Following on from the question of the noble Lord, , on transport,
can the Minister explain some of the figures in his response and
why the Government have delayed investment in the trans-Pennine
railway line while at the same time spending £760 million on the
east-west rail link between Oxford and Bedford, which is
certainly not even in the Midlands nor the north? How is this
levelling-up the economy?
(Con)
I am not exactly in the right department when it comes to
individual transport projects, but there is a huge commitment to
increasing investment in transport infrastructure. The
organisation Transport for the North has received funding to
develop the strategy so that we can get the right investment into
the north.
(Con)
My Lords, I declare my interests as set out in the register. The
big bang of the 1980s was driven by the right regulatory
framework and the technologies of the time. Fast forward 35 years
and we have a leading position in many of the technologies of our
time—AI, distributed ledger technology, cyber and fintech. Does
my noble friend agree that if we deploy those technologies, not
least in proposed fintech clusters in the north and other
regions, it will have a profoundly positive impact on jobs and
skills and—if combined with the right regulatory framework rooted
in consistency, clarity, competitiveness and innovation—it will
truly transform our nation?
(Con)
My noble friend is right that we need to look at the emerging
economy and encouraging fintech clusters so that we get more
high-skilled jobs located in the north. That is why the
Chancellor’s decision to locate the national infrastructure bank
in the north is also helpful in this regard.
(CB)
[V]
My Lords, my interests are as recorded in the register. In the
north, we have a double challenge. We need not only north/south
levelling-up but rural/urban levelling-up. Can the Minister
confirm how soon the Government will announce details of the
shared prosperity fund and whether there will be a dedicated
rural element to it?
(Con)
I am not in a position to announce further details on the UK
shared prosperity fund.
(LD)
[V]
My Lords, there is a glaring omission in this report. Its
proposals for business and the built environment have been
applied in one form or another since the Jarrow march in the
1930s, and I wish them well. However, levelling up is not a
problem of business and the built environment but a people
problem. What are the Government going to do to improve education
and training opportunities, and invest in people through projects
such as Sure Start, to help minority communities and the white
working class in the regions break out, so they can make
fulfilling lives for themselves and a greater contribution to
their regional economies?
(Con)
My Lords, the noble Lord is right that we need to see not only
economic development and growth in the economy but social
regeneration and the upskilling of people in the north. That is
why one part of the agenda is the devolution of decision-making,
including adult education and skills budgets, to the mayors
responsible for driving that agenda, as well as the economic
agenda.
(Lab) [V]
I draw noble Lords’ attention to my registered interests. On 19
February, the Government made a welcome, if modest, announcement
on the establishment of the Advanced Research and Invention
Agency. Do the Government acknowledge, as they surely must, that
unless the agency is able to deploy money directly to the north
of England, as opposed to the golden triangle of Imperial, Oxford
and Cambridge, we will not have the inventions or attract the
inward investment that the report so graphically laid out?
(Con)
My Lords, there should be no barrier to investing in the research
and innovation that the noble Lord outlines. I am sure that the
Government will take his point on board.
