I have made two recent visits to the northern region. On 13 April I attended the first Action for Cities roadshow in Newcastle. This was well attended by local business men, who demonstrated their commitment to the regeneration of the inner cities by making many specific offers of assistance. On 15 April I visited Teesside and saw some very encouraging signs that the regional economy is steadily improving and that regional pride and self-confidence are returning.
As unemployment in the assisted and intermediate areas of the region and in my constituency has fallen by 3 percentage points in the past 12 to 18 months, will my right hon. and learned Friend make a further statement on the industry in the region and the way in which it is picking up and creating jobs?
At my hon. Friend's invitation, on 15 April I visited two successful companies in Stockton, and I cut the first sod of a factory site for a third company. I saw why the regional economy is improving. My hon. Friend might have added that job vacancies in the region doubled during 1987. The best survey of his local economy came from the Teesside chamber of commerce. It surveyed its members and discovered that 68 per cent. had increased sales in the first quarter of 1988, 62 per cent. reported increases in home orders, 45 per cent. had increased their work force compared with three months ago, 92 per cent. expect their work force to increase or stay the same in the next 12 months, 87 per cent expect to improve turnover in the next three months, and 84 per cent. expect to increase productivity. The Teesside economy is getting off its sick bed and becoming a healthy economy again.
On his trip to the northern region, was the Minister made aware of the critical shortage of factory space, especially of units over 10,000 sq ft? Will he tell the House what the Government are doing to rectify that critical shortage, which threatens to choke off the upswing in the northern economy about which he has been talking?
It is a serious problem, because there has been a rapid increase in the demand for new factory space by businesses that want to open in the North-east. The hon. Gentleman is right in saying that demand is now outstripping supply. He knows the provisions that we made to English Estates and the assisted areas across the country. The time is now ripe for the private sector to provide factory buildings in the north-east as well. I assure the hon. Gentleman that, with demand and the state of the local economy being so high, it is obvious that private sector development of factories in that region is about to burgeon as well.
Does my right hon. and learned Friend agree that the northern region depends heavily on foreign investment? It has more to lose than probably any other English region from political barriers being erected to commercially judged takeovers.
I agree with my hon. Friend. The north-east has been found to be an attractive place to invest by the Japanese and by the first Korean investors, as well as by many European and American investors. Those foreign investors are welcome to put their money into the development of industry within these shores.
Can the Minister confirm that the integrated operations development programmes submitted to his Department have been passed to the Commission in Brussels? To date, the local authorities which have submitted those programmes have not received any word from his Department. Can he inform the House of the scale and timetable of article 15 of the structural fund? What is his Department's position? The structural programmes are for three to five years, but, we believe, the article 15 money is for only one year.
I believe that most of the integrated submissions have been made, but I shall let the hon. Gentleman know exactly which have now been made. No doubt he is most interested in the submission affecting his area. I know that the Birmingham submission has been made, and I believe that most of the others have also been made. With regard to article 15, we have accepted the local authority claims, but we are not taking a view. It is a matter between the local authorities and the Commission. Again, I shall write to the hon. Gentleman giving him the precise position on that.