Assisted Areas

– in the House of Commons at 3:30 pm on 26th July 1993.

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Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove 3:30 pm, 26th July 1993

With permission, Madam Speaker, I should like to make a statement on the Government's review of the assisted areas map. I had hoped to make the statement to the House last Friday, following approval from the European Commission on Thursday. But this was not possible because of other business. However, I signed the order giving effect to the new map on Friday and gave a written answer on the map. The order will come into effect on 1 August.

My right hon. Friends the Secretaries of State for Scotland and for Wales and I wrote to all the right hon. and hon. Members to inform them of the effects of the new map on their constituencies. We also made available in the Vote Office a short document setting out how we carried out the review and the outcome.

The present assisted areas map dates from 1984. It is out of date. In June last year we issued a consultation document announcing a review, setting out the procedures and inviting representations during a period of public consultation. A list of submissions received was placed in the Library on Friday.

The map defines those parts of Great Britain which are eligible for schemes for regional assistance. Those schemes are designed to promote new investment and jobs—inward investment from both United Kingdom and foreign firms, as well as investment from existing firms in the area.

The new map represents the Government's assessment of those areas which now face structural unemployment problems. There are some major differences from the previous map. This is not surprising. Unemployment patterns have changed significantly. For example, unemployment in south-east England increased from 8·4 per cent. of the work force in 1984 to 10·1 per cent. for the year to June 1993. Several areas have seen their relative employment position improve markedly. Closures or manpower reductions at defence establishments or major defence suppliers have hit localities particularly hard. In other areas, known major job losses in prospect will have serious effects on the local economy.

We have addressed those issues in a comprehensive review. Measures of unemployment have been the major factor in our consideration. We have examined current rates, the record of unemployment in an area over the past five years and the pattern of long-term unemployment, as well as trying to gauge future need for new jobs in each travel-to-work area. We have also weighed carefully the arguments put to us in the consultation process.

Clearly all those factors could not be accommodated in an automatic statistical process. We have had to make judgments about the extent of the structural problems of an area, the strength of local economies and the present status of an area and its neighbouring areas. The methodology used in the review is set out in the background document. Copies of this are available to the public on request.

The new map covers 33·8 per cent. of the working population of Great Britain. That is a little less than the 35 per cent. covered by the previous map, but the coverage of development areas at 16 per cent. is slightly higher. The map sets out those areas that we consider are in most need of assistance in Great Britain today and it includes many areas previously assisted.

The new map takes account of the level of unemployment in London. The inclusion of parts of Lea Valley, Park Royal and the London end of the east Thames corridor is a demonstration that the Government are fully aware of the serious unemployment problems in some London boroughs. In designating those parts of the capital, we sought to assist new investment in areas where there are substantial available sites and where infrastructure connections are good. Assisted area status will increase employment opportunities throughout the capital, but particularly in boroughs with the highest current unemployment rates.

Parts of the eastern and wider south-east regions are designated in the map. We have, for example, recognised the extremely high unemployment rates and structural problems currently faced by east Kent.

We recognised also the problems of some coastal towns —Great Yarmouth, Skegness and Hastings appear in the new map. Some areas previously heavily dependent on defence work face serious difficulties of adjustment. For that reason, Barrow and Weymouth, for example, come into the map while Fishguard and Haverfordwest are upgraded.

Substantial coverage in the east midlands and in Yorkshire will help coal closure areas with the task of regeneration. High unemployment in the west midlands is recognised by upgrading Wolverhampton and part of Birmingham.

The shape and overall coverage of the map for Scotland remains broadly unaltered. However, some adjustments to the status of individual travel-to-work-areas have been made to reflect changes in their relative circumstances.

While coverage in Wales has been reduced to reflect the relative improvement in unemployment levels in many parts of Wales, we took particular account of other policies and programmes of my right hon. Friend the Secretary of State—including the programme for the valleys and the west of Wales task force—as well as the position of north-east Wales in relation to other travel-to-work areas.

I recognise that there will be disappointment in areas failing to gain designation or losing assisted area status. We had difficult choices to make, but it is right to ensure that assistance is concentrated on those areas with the most serious problems.

As I said, the new map will come into operation on 1 August, so businesses that have been engaged in pre-application discussions with Departments under the various regional schemes will have an opportunity to complete formal application procedures before the changes take effect. Offers that have already been made will of course be honoured.

I emphasise that there is no direct connection between the assisted areas map and the structural funds maps. Those regions that are designated as assisted areas in the United Kingdom have no automatic right to objective 2 or 5(b) status under structural funds. Now that the structural funds regulations have been adopted, the Government will set in hand the procedures for determining which areas they should propose to the Commission for designation under objectives 2 and 5(b). As the House knows, objective I status has already been obtained by the Government for Merseyside and the highlands and islands.

In conclusion, many complex issues have been considered in this review. Our decisions were arrived at in a rational and structured way. The new map responds to the current position in the country and gives help where it is needed to enable areas to take full advantage of the recovery from recession. Assisted area status will give all designated areas the opportunity to attract new investment and to provide new jobs.

Photo of Robin Cook Robin Cook , Livingston

I understand why the Minister did not find it attractive to make a statement on Friday about changes due to be introduced on 1 August. After all, it was not at all clear last Friday that the Government would last until 1 August. Now that it looks as though the Government may hold together until Sunday, I am glad that the Minister shared our view that the House should have an opportunity to discuss a statement which has an immediate and direct effect on local economies and which—as was demonstrated a moment ago—is of immediate concern to many constituencies.

Does the Minister accept that I understand why Ministers have had to extend regional aid to towns in the south, where their policies have turned past prosperity into mass unemployment? Will he confirm that Clacton, Dorchester, Dover, Harwich, Hastings and Torbay have all seen their unemployment rate double in the three years since the present Prime Minister took office in No, 10? Does he admit that the new map which he has just unveiled is a confession of how fast the economies of these towns have declined over three years during 'which they have been ruled by a Conservative Government in Whitehall and represented by a Conservative Member of Parliament in Westminster?

May I ask the Minister, however, to square the pride that he has just expressed at extending the areas eligible for regional aid with his Department's spending plans, which show a cut in the budget to pay for it? Will he confirm that spending on regional aid this year is now at a mere fifth of the same budget in 1979, although unemployment has almost trebled? Can he confirm that over the past four years, even in a time of recession, this Government have halved the budget for regional aid? Can he explain to the House why he is spending less on regional aid when he has just admitted that there are more towns which need that help? Will the Minister also confirm that his statement does not contain a single extra penny to redress those cuts?

Is it that cut in the budget which explains why the Minister is paying for the extensions to his map by taking away help from towns that still need support? May I challenge him to name a single area that he has downgraded where unemployment has gone down since the present Prime Minister took office? If he cannot name such an area, will he admit that unemployment has gone up in every single one of the 20 areas that he has relegated? Can he explain why his review has left those communities with less help for more unemployment?

The Minister cannot have failed to notice the criticism that, of all the areas downgraded, only Corby is to the south-east of the midlands. Can he confirm that 17 of the 20 areas to lose out are in England, north of the midlands, or in Scotland, or in Wales? These are the parts of Britain furthest away from the big markets of Europe. They need extra support if they are to succeed against the extra costs of getting their goods to the centre of Europe. How can the Minister justify asking the parts of Britain with the highest costs of getting to Europe to shoulder the biggest cuts in regional aid? Given that Britain already has one of the most centralised economies in Europe, is it not an odd version of regional policy that gives less help to the regions furthest from the centre?

Britain already spends less on regional aid and less on support for manufacturing than the other member states of the European Community. Wealthier countries, such as Germany and Belgium, spend three times as much per head as we do on state aids to industry. Even poorer countries, such as Greece and Ireland, spend more than we do. What Britain needs is not just a Government who reshuffle the map to show which towns have slipped down the league table. What we need is a Government who will lift Britain from the bottom of the league and stop pretending that we can solve a growing problem on a shrinking budget.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

The hon. Gentleman referred to the size of the budget. I remind him that we are concerned here with a budget that is targeted at where help is really needed. As he will recall, in 1979 we had regional development grants, which was a very indiscriminate way of helping the regions. The change to regional selective assistance has produced benefits. As the recent scrutiny showed, we have a budget that produces really good value for the money spent.

In view of the enthusiasm of the hon. Gentleman's party for supporting measures from Brussels that would seriously damage the competitiveness of our industry, I am somewhat surprised by his reference to taking away help. As he knows, the size of the map is determined by, or is subject to, the approval of the Commission. I should have hoped that the hon. Gentleman would welcome that, because the Commission has to approve the size of the maps for all member states, which helps to keep down state aid and which creates a level playing field for our industry. I had hoped that the hon. Gentleman would welcome that and recognise that adding an area which is more in need of help necessarily means that an area that is less in need of help comes off the list.

We all know that the hon. Member for Livingston (Mr. Cook) is a well-acknowledged expert at seeing the gloomy side of every silver lining; clouds are always in his sight. In those circumstances, I would have been surprised if he had drawn attention to the fact that, since the last map was drawn, unemployment has dropped—and in some cases has dropped very significantly—in the north, the north-west, Yorkshire and Humberside and the east and west midlands. Does not the hon. Gentleman find that a matter for welcome and an explanation of why there have been changes? Or is it perhaps that the Labour party does not really want to represent the whole country, but wants to be selective? It is the hon. Gentleman's credentials on political impartiality that need to be examined.

Several hon. Members:

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Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

Order. It must be pretty obvious to the House that I cannot call all the hon. Members who are standing—[Interruption.] Because I must safeguard the interests of private Members and the other business on the Order Paper. Therefore, I ask that questions be brisk and that answers be equally brisk.

Photo of Mr Michael Alison Mr Michael Alison , Selby

May I express my gratitude to my right hon. Friend on behalf of my constituents and myself in that some parts of Selby district lying within the Castleford and Pontefract travel-to-work area, notably the town of Sherburn, have been included for the first time for intermediate area status? We are deeply obliged to my right hon. Friend for that. He may not appreciate that Sherburn does not have as severe an unemployment problem as that in parts of the town of Selby which lie in an adjoining travel-to-work area. Would my right hon. Friend be kind enough to agree to receive a small deputation as soon as possible to argue the case for objective 2 status for parts of the town of Selby?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I thank my right hon. Friend very much for his kind remarks. Representations made by him, and by hon. Members from all parts of the House, were very helpful in assisting us to arrive at the right conclusion in respect of the map.

With regard to objectives 2 and 5(b) status under the structural funds, the regulations have only just been agreed. Indeed, they were agreed at 5.30 am last Tuesday in Brussels. We will send out a document very shortly about the consultation process that we will enter into. I will, of course, be very willing to receive representations.

Photo of Malcolm Bruce Malcolm Bruce Shadow Spokesperson (Trade and Industry)

As I represent the constituency with the lowest unemployment in the United Kingdom, I have no axe to grind in this particular context and I recognise the Government's case for the review. My only request is that the travel-to-work areas should be reviewed soon and sensibly so that we do not have the nonsense of areas like the summit of Ben Macdui being within the Aberdeen travel-to-work area.

There will, of course, be disappointment where there has been loss and appreciation among my hon. Friends where areas have retained or enhanced their status. I know that my right hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) and my hon. Friends the Members for North Devon (Mr. Harvey) and for Rochdale (Ms Lynne) would like to be associated with that. Nevertheless, will the Minister accept that as long as we have these periodic reviews, they are, in effect, a testament to failure? We need to ensure that we have a programme to eliminate unemployment in this country and to ensure that we can all benefit from prosperity and low unemployment.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

The hon. Gentleman displayed the usual Liberal Democrat party skill in respect of sitting on the fence about sitting on the fence. He was not quite clear whether, on behalf of some of his Friends, he wanted to welcome the announcement or to criticise it.

With regard to the travel-to-work areas, we do not yet have, and will not have for 18 months or so, the sensitive data that will enable us to calculate new travel-to-work areas. I have said that the map will last for at least three years. Obviously, when we have that sensitive data and we can see the shape of the new travel-to-work areas, we will take account of the implications of that, including the implications in respect of the summit of any mountain, whether in England or anywhere else.

Photo of Mrs Peggy Fenner Mrs Peggy Fenner , Medway

Although I recognise why my right hon. Friend has included east Kent, its inclusion will make it particularly difficult for the Medway towns which fit the criteria of relying heavily on defence work. My constituency has lost the naval base and its largest employer, an aircraft and avionics company. Will my right hon. Friend co-ordinate activities with our right hon. Friend the Secretary of State for the Environment and reconsider a small extension of enterprise zones so that we may compete with east Kent for a rightful share of industry?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I can understand my hon. Friend's reaction. Considerable sums of Government money have gone into the Medway towns, particularly in respect of the much applauded Chatham dockyard redeployment. On the defence point, there might be representations from my hon. Friend's area in respect of the Konver funds which are available.

Photo of Mr Neil Kinnock Mr Neil Kinnock Member, Labour Party National Executive Committee

Is it not already obvious that the statement is mainly a product of pork barrel politics? Does the Minister accept that the relative increase in unemployment in south-east England is far more cyclical than structural and that there is a case for new assistance? As that case exists, such new assistance should come from additional funds and not from the reallocation of funds. As south-east England is obviously nearest to the European mainland and the channel tunnel link, and as it benefits most from the reduction in interest rates, is it not obvious that the circumstances do not warrant the reduction in status for assistance as in other parts of the United Kingdom? Is it not obvious on any assessment that the statement comes about not as a product of the examination of economic realities but as a result of political expediency?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

The right hon. Gentleman does not do himself justice. He seems to support his hon. Friend the Member for Livingston (Mr. Cook) in suggesting that there should be unlimited state aids available not only in this country but elsewhere. I should have hoped that, on this matter at least, he would support the Brussels Commission's efforts to restrain the availability of state aids and therefore help our industry.

The right hon. Gentleman referred to pork barrel politics. With respect, that term should be used with care in respect of Wales. After all, the unemployment rate in Wales is the same as that for the whole of Great Britain, yet more than 70 per cent. of the working population in Wales are covered by assisted areas. There are good reasons for that. They recognise the points that I made in the statement, but I scarcely think that they are grounds for complaint.

Photo of Mr Nick Hawkins Mr Nick Hawkins , Blackpool South

My right hon. Friend will be aware that there is great disappointment in my constituency and in that of my hon. Friend the Member for Blackpool, North (Mr. Elletson) at the fact that we have not acquired assisted area status. Will my right hon. Friend confirm that he will be happy to meet a delegation from Blackpool, led by my hon. Friend and myself, to discuss objectives 2 and 5(b) status? Does he accept that we have very severe structural unemployment, including three in 10 male unemployment in the centre of Blackpool? When my right hon. Friend reconsiders the way in which travel-to-work areas are calculated, will he bear in mind that Blackpool's case for assisted area status has once again been damaged by the fact that it is surrounded by Fylde and Wyre, which have very low unemployment, and that Blackpool has problems of its own?

Does my right hon. Friend agree that the position regarding the United Kingdom would be made very much better if the former Opposition Member who became a European Commissioner, Mr. Millan, did not continue to block tourist-related areas from objective 2 status? That does enormous harm, as would the Opposition's desire to impose the social chapter.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I appreciate the concern and disappointment in my hon. Friend's constituency and, I am afraid, in other areas throughout the country. My hon. Friends the Members for Blackpool, South (Mr. Hawkins) and for Blackpool, North (Mr. Elletson) made expert representations on behalf of their constituencies. Of course I shall be happy to meet a delegation; and I note my hon. Friend's other remarks about the important subject of tourism.

Photo of Harry Cohen Harry Cohen , Leyton

Does not the Minister's statement reek of political corruption? Why did Enfield get assisted area status ahead of Leyton, for example? On any criterion of need such as unemployment, my constituency is far ahead. Could it be that the right hon. Gentleman's boss at the Department of Trade and Industry is an Enfield Member, as is the Chief Secretary to the Treasury? Is this not a contemptibly corrupt statement?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

May I remind the hon. Gentleman that the President of the Board of Trade is the Member of Parliament for Henley, not Enfield?

Photo of Harry Cohen Harry Cohen , Leyton

The hon. Member for Enfield, North (Mr. Eggar), then.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

The important point that the hon. Gentleman should recognise is that if he were as familiar with the Lea valley as I am, he would know that it has major sites of existing industry and sites available for new industry. I suspect that many people in his constituency work in that area and others who, sadly, have not got jobs at present could easily travel to that area if new jobs were created there. That is why it makes sense to us to target help where it will produce the greatest benefit.

Photo of Mr William Powell Mr William Powell , Corby

As the Member for a constituency that is apparently a victim of pork barrel politics, may I congratulate my right hon. Friend on his statement and welcome it on behalf of the former assisted area of Corby? My right hon. Friend should be aware that assisted area status was one, but only one, of the factors that enabled such a remarkable transformation in the industrial and commercial scene of Corby to take place. We are grateful for what the Government have done in the past decade, and we recognise that the time had come for other areas to receive some of the benefits given to Corby.

I should like to question my right hon. Friend on one matter. Assisted area status also prised open the opportunity to receive derelict land grant, which was vital to the reconstruction of Corby. Now that assisted area status has been removed from Corby, will my right hon. Friend make representations to the Secretary of State for the Environment to ensure that derelict land grant can continue to flow to Corby, because the job of restoring that land is not yet finished?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I much appreciate what my hon. Friend has said in respect of his constituency, on behalf of which he has made energetic representations. He has struck exactly the right note. Corby's economy has been transformed in part as a result of the assistance it received through the assisted area map, but largely because of the efforts made by those in all parts of the Chamber, the private sector, and local government and because of central Government help. To build on that success is surely the way forward for areas such as Corby, because they have reduced unemployment, achieved success and, as a consequence, are no longer eligible for assisted area status.

Photo of Gerald Kaufman Gerald Kaufman Chair, National Heritage Committee

When the right hon. Gentleman made his statement, he said that the arrangements announced today were made to assist those areas with the most serious problems. Can he then explain why it is that the Sutton Coldfield constituency, which ranks 552nd in terms of the unemployment rate, with 6·4 per cent. unemployed, has been upgraded, while my constituency, 37th in the unemployment table, with 18·2 per cent. unemployment and 25·4 per cent. male unemployment, has got no help at all? Sutton Coldfield is, of course, the constituency of the chairman of the Conservative party.

Given that the Government have taken away housing programme funding, section 11 funding and urban programme funding from my constituency and reduced the benefits to the poor and deprived who live in my constituency, is it surprising that my constituents use the word about the Prime Minister that the Prime Minister uses about members of the Cabinet?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I am afraid that the right hon. Gentleman does not serve his interests or those of his constituents with that type of remark. May I remind him that, in 1984, unemployment in Manchester was 13·2 per cent., which put Manchester exactly within the worst third in terms of those in the working population? Unemployment in Manchester is now 10·5 per cent., which means that it is not even within the worst half in terms of those not in the working population.

Photo of Mr Andrew Bowden Mr Andrew Bowden , Brighton, Kemptown

My right hon. Friend has a deservedly high reputation in this House for integrity. He will share my disappointment at the fact that Brighton and Hove have not been included. Can he see any possibility of helping the Brighton and Hove travel-to-work area, given that we cannot now fairly compete in persuading firms to come to the two towns because others will be able to bribe them to go elsewhere? Will he consult his colleagues on other ways of helping these areas?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I am grateful for my hon. Friend's opening remark. I know that Brighton and Hove have no more energetic supporter than my hon. Friend. I also know of the disappointment in the area at not being designated. As I have said, inevitably some areas that were close to inclusion had to be left out because of the limit. I hope that Brighton and Hove will gain additional strength in attracting investment and more jobs from the considerable improvements made to the A23 and the bypass—improvements funded by Government money. They will help to further the attractiveness of the area.

Photo of Alan Milburn Alan Milburn , Darlington

Does the Minister realise that stripping Darlington of assisted area status is a devastating blow not just to the town but to a region that has had the highest unemployment rate in every month since the Government came to power? Is he not aware that his policy of cutting regional aid spending at a time of recession is economically illiterate and has forced hundreds of areas to compete for slices of an ever-diminishing regional aid cake? Why should Darlington be sacrificed so that the right hon. Gentleman can gerrymander the new assisted areas map in a vain attempt to prop up crumbling Tory support both across the country and particularly in southern England? Does he not realise that his announcement is a slap in the face for the business community in Darlington, and that the Government will not be forgiven for having written off the town?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I think that the hon. Gentleman is another one who would not recognise success if it fell on him. In 1984, Darlington's unemployment rate was 13.3 per cent.; for the year to June 1993, it has been 9.3 per cent., which means that it is two thirds—65·2 per cent. —down the list of the worst areas for unemployment. Yet the hon. Gentleman still claims that special help is needed. Instead, he should recognise the success achieved by the private sector in his constituency.

Photo of Mr Colin Shepherd Mr Colin Shepherd , Hereford

Does my right hon. Friend acknowledge that there is a good deal of dismay in areas that have not sustained their assisted area status? May I draw his attention in particular to the dismay felt in the Cinderford and Ross-on-Wye travel-to-work area, part of which lies in my patch? A number of those who have been teaming together to create employment opportunities feel that their work is not yet done, and it would be helpful if my right hon. Friend were kind enough to state the predominant reasons for the withdrawal of assisted area status from the area.

When would it be appropriate to take a delegation to see my right hon. Friend to discuss the question of objective 5(b) status, given the stress caused in rural areas, especially in the marches, by changes in the common agricultural policy?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I appreciate the disappointment in my hon. Friend's constituency at the loss of intermediate area status. My hon. Friend asked me about the most important factors involved in that. As we made clear in the consultation and background documents, measures of unemployment are the principal factors, but they are not the only ones that we took into account. On that basis, current unemployment in the Cinderford and Ross-on-Wye travel-to-work area is fractionally above the national average, and on the five-year average the area only just gets into the worst 60 per cent., not the worst 33 per cent.

I would be happy to talk to my hon. Friend and a delegation about objective 5(b) or objective 2 status in the near future.

Photo of Mr Stan Orme Mr Stan Orme , Salford East

Will the Minister explain why an area like Salford, with all its problems of high unemployment, crime and so on, has been excluded from the map?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

As the right hon. Gentleman knows, we are retaining support for Trafford Park where, I suspect, many of his constituents already work. If additional employment were created there, it would provide opportunities for his constituents and others in the Manchester and Salford area. As Manchester is one large travel-to-work area, the comments about overall unemployment which I made to the right hon. Member for Manchester, Gorton (Mr. Kaufman) also apply in this case.

Photo of Mr Michael Jopling Mr Michael Jopling , Westmorland and Lonsdale

Will my right hon. Friend accept the warmest possible congratulations and thanks from those of us in Cumbria who recently did our best to persuade him to grant assisted area status to parts of Cumbria? The inclusion of Barrow, and an area around it which is in my constituency, among those areas granted intermediate status will be especially welcome, but will he please talk to his right hon. Friend the Secretary of State for Transport because one of Barrow's main problems is the road links with the M6? Portions of that road in my constituency require urgent improvement, and that would be one of the quickest ways to help Barrow.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I thank my right hon. Friend for his opening remarks. I was very impressed by the representations that he and others made when I visited the area and back in London. I shall, of course, pass his comments to my right hon. Friend the Secretary of State for Transport. It is fair to say that, if I followed the Opposition's suggestions, new areas of Cumbria and Barrow-in-Furness would not have been included in the map because it would not have been possible.

Photo of Mr Cynog Dafis Mr Cynog Dafis , Ceredigion and Pembroke North

The elevation of the Fishguard area to full development status is welcome, but the relegation of Cardigan, which is covered by the west Wales task force, from full development area status to intermediate status makes very little sense. The relegation of Lampeter and Aberaeron from full development status to no status makes even less sense. Bearing in mind the fact that those areas have deep structural problems, including that of depopulation and migration of the young, is it not clear that the Minister was determined that Wales should suffer from the process a net reduction in assistance?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I am grateful for what the hon. Gentleman said at the start of his question, but I must point out that in the Lampeter and Aberavon travel-to-work area—

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

Aberaeron. I am grateful to the hon. Member for Cardiff somewhere for his help.

The point in which I think that the hon. Member for Ceredigion and Pembroke, North (Mr. Dafis) is interested is that the unemployment rate dropped from 12 per cent. to 7·6 per cent. As I said earlier in relation to the unemployment rate in Wales as a whole, it would surely be unrealistic not to reflect in the map some of the considerable success that has been achieved in stimulating employment in Wales and especially in attracting inward investment, which would, of course, be drastically discouraged if we were to saddle ourselves with the social chapter.

Photo of Roger Gale Roger Gale , North Thanet

On behalf of my hon. Friend the Member for Thanet, South (Mr. Aitken) and my constituents, may I thank my right hon. Friend for the way in which he has represented the United Kingdom's interests in the negotiations with the European Commissioners? Will he contrast the mealy-mouthed reception from the hon. Member for Livingston (Mr. Cook) with the generous reception given by the Local authority in Corby which, having seen the success of assisted area status there, has offered its expertise to Local authorities in east Kent? Is it not a fact that east Kent will now be able to compete with northern France on equal terms for jobs not only for east Kent but for the whole of the United Kingdom?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I can do no more than say that my hon. Friend's response is surely the right one on behalf of his constituents and the people of the whole of east Kent. They will be able to take the opportunities provided by the availability of regional selective assessment to build their economy and ensure that they are soon in the same position as Corby. I am grateful for what my hon. Friend said about seeking to represent the whole of Great Britain, and not just a part of it.

Photo of Mr Peter Shore Mr Peter Shore , Bethnal Green and Stepney

Although I welcome the long overdue inclusion of some depressed parts of London in the list of assisted areas.. will the Minister explain why and on what grounds he has excluded the notoriously hard-pressed boroughs of east London, especially my own borough of Tower Hamlets, where unemployment has been running at more than 20 per cent. for many years?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I am conscious of the unacceptably high levels of unemployment in the right hon. Gentleman's borough. He will be aware of the many urban programmes, including the London Docklands development corporation, that benefit the area. He will also be aware that the areas that we have designated in London have available industrial premises and space for the creation of additional investment and employment. If that happpens, and we hope that it will as a result of the measures that we have taken, those employment opportunies will be available to people in that whole travel-to-work area, which is reasonably near his constituency.

Photo of Mr Paul Channon Mr Paul Channon , Southend West

Is my right hon. Friend aware that it is believed that Southend was on the original list for assisted area help and that my constituents and I are astonished that it was withdrawn from his proposals at the last minute? Will he say whether that is the case and, if so, why?

Will my right hon. Friend also be prepared to meet Southend council, our hon. Friend the Member for Southend, East (Sir T. Taylor) and myself to discuss ways of getting help under objective 2 status?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

There were areas around the margin of eligibility for inclusion in the map, which would have been included had the map covered a larger area of the working population of Great Britain. I am sure that my right hon. Friend will agree that it is right that the Commission should exercise constraint on the overall coverage, as it does in other countries. For instance, the German map has now been reduced by 2 per cent.—much more than ours. In those circumstances, there were unfortunately areas that had to be omitted and I recognise that Southend was one.

I should be happy to receive a delegation of my right hon. Friend, his hon. Friend and councillors to discuss the matters that he has raised.

Photo of Ken Purchase Ken Purchase , Wolverhampton North East

It is welcome that Wolverhampton enjoys its new status, along with Birmingham, and the Minister will be encouraged that, in the past, Wolverhampton has put together a team of excellent workers who have managed to lever European funds from other areas. Against that and the disadvantage to other areas from which Wolverhampton will receive its new support, it must be recognised that in 1979 Wolverhampton was part of the second wealthiest region in the United Kingdom. Now it shares the distinction with Northern Ireland of being one of the poorest. Fourteen years of Conservative rule have brought such a map into being.

I share the opinion of my local chamber of commerce, and more so with the Wolverhampton Express and Star—a Tory paper if ever there was one—that it is a tragedy that Wolverhampton, Birmingham and the west midlands have to receive special treatment to overcome the difficulties brought about by the economic policies of the Government. The Minister ought to ask himself what the Government should be doing to put the economy of the country right rather than messing about with maps.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

Perhaps the hon. Gentleman can persuade some of the doubting Thomases on the Opposition Benches that the map is targeted at the areas that need help and that it responds to changes in economic circumstances. That is the realistic answer to some of the questions that have been asked by his hon. and right hon. Friends.

I hope that we shall see Wolverhampton re-establishing its levels of employment and industrial expertise to those of the days when I remember that Wolverhampton Wanderers played better football than Manchester United.

Photo of Dr Ian Twinn Dr Ian Twinn , Edmonton

In contrast to the carping and negative attitude of Opposition Members, may I thank my right hon. Friend for his Department's recognition of the desperate structural needs of industry in the south, especially in the Lea valley? As one of the Enfield Members of Parliament, may I say that our constituents in Enfield, North and Edmonton will notice that the attitude of Opposition Members and the Labour party is of not wanting to create new jobs in those areas, especially in north London.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

My hon. Friend is right, and I am grateful to him for his appreciation of what has been done. He has put his finger on the essential point that, if we had followed the approach of the hon. Member for Livingston (Mr. Cook) and his friends, there would have been no changes to the map and no relatively worse off areas would have been able to receive help.

Photo of John McFall John McFall , Dumbarton

The heart-breaking aspect for my constituents is that the information on which the list was compiled is out of date. Unemployment in 12 of the winners has fallen by 10 to 46 per cent. in the past six months, yet my constituency, which has had a 7 per cent. fall, is a loser. My constituency still qualifies on the three criteria that the Minister stated—present unemployment, long-term unemployment and growth potential. Will the Minister meet a delegation from the local enterprise company and the council to ensure that Dumbarton retains its full development status? Dumbarton's figures are more up to date than those of the Department of Trade and Industry.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I appreciate the hon. Gentleman's sorrow at Dumbarton being downgraded from a development area to an intermediate area, but I know that my hon. Friend with responsibilities for industry in Scotland will be happy to see him this week. Unemployment in the Dumbarton travel-to-work area is well above the worst third in the country, which the hon. Gentleman should take into account.

Photo of Mr Peter Griffiths Mr Peter Griffiths , Portsmouth North

Does my right hon. Friend accept that there is not only disappointment but concern in Portsmouth that the criteria that he used in drawing up his map failed to identify areas of social and economic deprivation in the city, which are the equivalent of that anywhere else in the country but which the city is unable easily to rectify because of the long-term rundown of the defence commitment, which is part of the Government's policy? In those circumstances, does he feel that he has a responsibility to offer help to Portsmouth?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I can understand my hon. Friend's reaction. We carefully considered the implications of the defence review, all the changes in the Navy and their impact on his constituents. I hope that he will recognise that there are swings and roundabouts: some naval activities in the area will increase, whereas others will be run down. I know that he and my hon. Friend the Member for Portsmouth, South (Mr. Martin) made energetic representations on behalf of the Portsmouth travel-to-work area, but I had to take into account not only the overall effect of defence changes but the fact that Portsmouth is not in the worst third for current unemployment and is well below the British average for five-year unemployment. Unemployment measures were the main measures that we took into account.

Photo of Elliot Morley Elliot Morley , Glanford and Scunthorpe

Is the Minister aware of the disappointment in areas such as Scunthorpe that have lost full development status and have gone to nothing? The way in which unemployment is calculated leads areas such as Scunthorpe to have little confidence because it has been changed and messed around so much over the years. Is he aware that millions of pounds of public money have been spent on site reclamation, the benefit of which is only now being felt? It will be difficult to attract industry to Scunthorpe when it is surrounded by areas that have status.

Will the Minister meet a delegation from the councils concerned when he reviews the travel-to-word areas in the second half of 1994 to consider the impact of the changes on an area that is suffering from long-term structural change and does not need a quick fix in terms of political need?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

It is a little early to start talking about delegations when we have—[Interruption.] Wait for it—the information on new travel-to-work areas. Consideration of objective 2 and/or objective 5(b) status is in the immediate future. The new travel-to-work areas will not be considered before 1995 at the earliest.

Is the hon. Gentleman aware that unemployment in his travel-to-work area is only 9·7 per cent.—[HON. MEMBERS: "Only?".]—which, although still too high, is below the national average? Does he believe that Scunthorpe has achieved a great success in restoring employment opportunities after the losses that occurred at the end of the 1970s and early 1980s? Will he welcome the forthcoming opening by Kimberly-Clark as a major new employment opportunity in his area as a result of Government help that the area received?

Photo of Mr David Shaw Mr David Shaw , Dover

Will my right hon. Friend confirm that he very much had regard to the considerable changes that will take place in Dover and Deal as a result of the channel tunnel, the single European market and the problems of competition from the Nord-Pas de Calais region when he listened to the representations that I made at the seven meetings that I had with him and the President of the Board of Trade on this important issue? Will my right hon. Friend further confirm that it has been disappointing that the Labour party has not actively supported the south-east of England getting assisted area status, especially Dover and Deal, whose people are very grateful to the Government for recognising the considerable change that is about to take place and for the support that they are now giving the area?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I agree with my hon. Friend about the attitude of the Opposition to assisted area status in parts of east Kent and the south-east. If a league table were based on the energy and effectiveness of the representations made on behalf of any area, I think that my hon. Friend would be near the top of it. I am sure that he will recognise that Dover and Deal would not have been included purely on the employment factors, but, taking account of the looming problems to which he referred, we clearly had a situation that deserved support.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

Is not it true that the statement and delaying of the order have been held back so that the rejigging and gerrymandering of assisted area status can be used to bribe anti-Maastricht Tory Members of Parliament? There is no reason why the order could not have been laid several weeks ago and come before the House for debate in the usual way.

The people of Bradford will feel outraged that the Minister is removing assisted area status from Bradford when they have been denied section I I grant and, as with many other areas, have been removed from urban aid grant, and when there are 552 vacancies with 25,000 people on the dole as a result of the Government's policies.

Does the Minister not realise that Bradford depends on manufacturing more than the national average, particularly on textiles and engineering, and both those industries are facing severe difficulty? It is a disgrace, and the Minister should know it.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

It is not possible for us to declare the result of our review before Friday at the earliest, because the Commission—the European Commission; the hon. Gentleman will have heard of it—has not approved our map. The map is subject to its approval because the aid given under regional selective assistance is state aid, so that his first allegation is nonsense.

It is perhaps not surprising that we should hear nonsense from the hon. Gentleman. He gave a splendid impersonation to Bradford of outrage. May I say to "Outraged of Bradford" that, in 1984, unemployment in Bradford was at 13·5 per cent., which put it in the worst third of unemployment areas of the country. It is now 10·6 per cent. and Bradford is only just inside the worst half. That is one of the factors that we took into account in deciding where the aid should best be targeted.

Photo of David Evennett David Evennett , Erith and Crayford

I congratulate my right hon. Friend on his statement. In particular, I warmly welcome the inclusion in his list of the London end of the east Thames corridor. My constituents in the wards of Belvedere, Erith, North End and Thamesmead East will be delighted, because they have had structural unemployment in those areas for so long.

Does my right hon. Friend agree that the east Thames corridor has tremendous potential, and his announcement this afternoon will help to realise it?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I am grateful to my hon. Friend for what he has said, and entirely agree about the potential of the east Thames corridor. I hope that, with the help of the measures that I have mentioned in the statement. that potential will be realised in the near future to the benefit of his constituents.

Photo of Margaret Ewing Margaret Ewing , Moray

In the context of the structural funds, will the Minister accept that there was a warm welcome given to the recognition of the long, hard-fought local campaign to include the whole of the enterprise area in Highlands and Islands for objective 1 status?

Is the right hon. Gentleman yet in a position to announce the exact figure that will be allocated, given the unhelpful speculation following on from the attitude of the Irish representatives at the Commission? Can he give us an exact timetable for the procedures that are to be observed in negotiations for 5(b) status, which is important, particularly to the fishing communities of the north-east of Scotland?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

First, I express my thanks for the hon. Lady's remarks about what she described as a long and hard-fought campaign. From my personal experience, I can say that it was indeed very long. It was about the hardest-fought campaign that I have experienced, among many, in respect of the European Community.

With regard to the sums of money involved, I hope that my right hon. Friend the Secretary of State will be making an announcement in the near future.

Photo of Mr Roger Moate Mr Roger Moate , Faversham

I congratulate my right hon. Friend on the courageous way in which he tackled what is self-evidently a difficult task and thank him for his courtesy and consideration in doing it, particularly in recognising that parts of the south-east have persistent and structural unemployment problems. Unemployment in my constituency is 14·2 per cent.—something that is unknown to the Labour party, or perhaps it does not even care.

Will my right hon. Friend say what the likely duration of the map will be? The previous map survived for nine years. In his statement, he says that it is expected to last at least three years, but three years is too short a planning period for many industrial investments. Can he reassure us that that is seen as the minimum and is likely to be much longer?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I am grateful for what my hon. Friend has said, and I was glad to have the opportunity to see for myself at first hand the situation in his constituency and to receive representations both from him and the public and private sectors in his constituency.

With regard to the duration of the map, we have said at least three years because it will not be much before the end of three years that we have information relating to the new travel-to-work areas. We should not prejudge the duration of the map beyond that because we may find that the new travel-to-work areas show that there should be changes. When we make the next review, I assure my hon. Friend that, as was the case with this review, we shall take into account the statistics and not the political gerrymandering that seems to be preferred by the Labour party.

Photo of Mr Dale Campbell-Savours Mr Dale Campbell-Savours , Workington

When the people of Workington, where unemployment is 15·1 per cent. on the narrow base rate, learnt of their downgrading from development area status, they were astonished, astounded and angry. Despite what the right hon. Member for Westmorland and Lonsdale (Mr. Jopling) said, let me make it clear to him that Yorkshire farmers know nothing about west Cumberland. Workington has a new factory of 500,000 sq ft that is empty, which the Leyland bus plant formerly occupied. Can the Minister find us a tenant or a buyer in the conditions of the new intermediate area status, because if we can fill that site, many of Workington's problems will be resolved?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I can understand the hon. Gentleman's concerns about the problems in his constituency, and I know that the unemployment level there is far higher than either of us would like to see. However, I hope that he will recognise, with regard to the downgrading from development to intermediate area status, that the constituency's unemployment rate does not put it in the worst 15 per cent. on either current or five-year average unemployment. Those are factors to which we have to have regard. I hope that, as a result of the combined efforts of the private sector, local authorities and central Government, we shall be able to find a tenant and provide more employment opportunities for his constituents.

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

Does my right hon. Friend agree that, although there must be some disappointment in Teignbridge that it was not possible to extend to a greater extent the intermediate status, nevertheless the settlement for the west country is truly excellent? As the prosperity of Teinbridge depends on the prosperity of the west country, the decision that he has announced today will be greatly welcomed.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I am particularly grateful for what my hon. Friend said about the west country, and I also appreciate what he said about his constituency; I understand his disappointment that only a small part of it receives assisted area status. I am more than a little surprised that neither from the Labour nor from the Liberal Benches have we had a word of thanks on behalf of the south-west.

Photo of Paddy Tipping Paddy Tipping , Sherwood

Coalfield communities face real challenges and real difficulties. In the Nottinghamshire coalfield, 40,000 people worked in the industry in 1980 and, in a few weeks' time, that number will shrink to 4,000. In the space of 13 unlucky years, nine out of every 10 mining jobs will have gone. Given that, will the Minister consider including in the Nottingham travel-to-work area places such as Hucknall, which has lost its pits, and Calverton, which may lose its colliery, so that they may have a chance of new investment, new jobs and a new future?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I can understand the hon. Gentleman's concern about employment opportunities for those who formerly worked in the coal industry. I hope that he will recognise that in what we have done—for example, in respect of Mansfield, which moved straight from non-assisted area status to development area status, or Chesterfield, which moved from non-assisted area to intermediate area status—we are responding, in as an effective and well targeted way as we can, to the needs of the areas to which he referred.

Photo of Mr Rupert Allason Mr Rupert Allason , Torbay

I thank my hon. Friend for his statement, and I also thank him on behalf of my constituents and the delegation that I brought to see him. He will be aware that the decision to restore assisted area status to Torbay will be greatly welcomed. Will he assure the House that his Department will do everything possible to help local authorities in those areas that have been granted intermediate status so that they may exploit European and other funds to the maximum?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I am grateful to my hon. Friend for what he said and assure him that, as always, my Department will do all that it can to help local authorities to attract inward investment and in any negotiations with the European Community.

Photo of Sir John Morris Sir John Morris Shadow Attorney General

In an attempt to assist the Minister to distinguish between Aberaeron and Aberavon, may I point out to him that there will be intense disappointment that Port Talbot and Neath have been reduced to an intermediate area? An announcement was made last Thursday that Freeman's factory would close next March. How will new factors, which have arisen since the map was cobbled together, assist the situation in the future? When can the map be reopened?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I hope that the right hon. and learned Member will recognise the considerable progress made in reducing unemployment in his constituency, or the travel-to-work area in which it is sited, from 16·8 to 10 per cent.—from well above to below the national average. I hope that we shall continue to build on that success.

As I have made clear, the present map should last for at least three years. As my hon. Friend the Member for Faversham (Sir R. Moate) said, we need a period of stability for people to benefit from the opportunity to carry out investment projects or to make inward investments which will provide work for a reasonable period.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Southend East

Does the Minister agree that, far from being omitted, Southend-on-Sea was removed from the list that the Government presented to the Commission on 15 June? Will he bear in mind that, as a result of the Commissioner instructing the Government to reduce the figure from 35 to 34 per cent., there is widespread disappointment and concern in Southend-on-Sea, particularly as my constituency has 14·5 per cent. unemployment? If any area in the south-east deserves help, it is Southend-on-Sea.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I understand the concern of my hon. Friend's constituents. Clearly it is a great disappointment when they were near to being included and have had to be left out because of the constraints imposed by the amount of cover that we can give. I assure my hon. Friend that we shall do all that we can to assist with regard to any structural fund help that might be available.

Photo of Mr Robert Sheldon Mr Robert Sheldon Chair, Public Accounts Committee, Chair, Public Accounts Committee

Is the Minister aware that Tameside is one of the two metropolitan boroughs that were not created from a county borough? That causes enormous problems because of the diversity of centres within the borough, and there are associated costs. Will the Minister let me have an analytical breakdown of why Tameside was not given intermediate area status? He said that judgment was used. Is he aware that a distinction needs to be made between judgment and pork barrel politics, which was not clear in this instance?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I can assure the right hon. Gentleman that a clear distinction was made. He is an expert on analysing statistics. I cannot promise to give him an answer off the cuff, but I will write to him in response to his request.

Photo of Mr Richard Tracey Mr Richard Tracey , Surbiton

My right hon. Friend is to be congratulated on conducting a difficult piece of work. Will he agree that more parts of London should qualify for this sort of assistance? Will he undertake to keep a close eye on changing patterns of work in London so that fresh areas can be assisted in the near future?

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I can assure my hon. Friend that we shall pay close regard to the situation in London before the review of the map in three years' time or so. Meanwhile, London benefits from the measures to which I referred today, and from a large number of urban programmes. I know that my right hon. Friend the Secretary of State for the Environment will keep those programmes under close review to ensure that they target help to London as effectively as possible.

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

In justifying the downgrading of certain areas, the Minister said that those areas now have lower unemployment than they had in 1984. Will he confirm that Barnstaple, Ilfracombe, Bideford, Clacton, Dover and Deal, Folkestone, Great Yarmouth, Torbay and Thanet all have lower unemployment than in 1984? On that criterion, why have those places been included while places represented by my right hon. and hon. Friends have been excluded? In reply to my right hon. and hon. Friends, the Minister said that Bradford had only 10·6 per cent. unemployment and that Scunthorpe had only 9·7 per cent. Is it not a clear indication of the Government's limited ambitions and moral bankruptcy that they see such figures as low unemployment?

The simple fact is that the Minister has had to announce a map that reflects the Government's economic failure. All of Britain should now be an assisted area because the Government have failed so abysmally.

Photo of Hon. Tim Sainsbury Hon. Tim Sainsbury , Hove

I should have hoped that the hon. Gentleman would recognise from his Front-Bench position that we are inevitably looking at the scale of change in unemployment and the relative position of different areas. I remind him, as he is another of the half-empty rather than the half-full glass school, of the relative position of the regions. The northern region, the north-west, the Yorkshire and Humberside region and the east and west midlands have all had significant improvements in unemployment since the last map was drawn, whereas in London and the south-east and south-west unemployment has got worse. That is the reality and the reason for the map that I have produced. It is targeted on areas that most need help.