Regional Development Agencies

Oral Answers to Questions — Business, Enterprise and Regulatory Reform – in the House of Commons at 10:30 am on 5th July 2007.

Alert me about debates like this

Photo of David Heathcoat-Amory David Heathcoat-Amory Conservative, Wells 10:30 am, 5th July 2007

What recent assessment he has made of the effectiveness of regional development agencies in promoting enterprise.

Photo of Pat McFadden Pat McFadden Minister of State (Department for Business, Enterprise and Regulatory Reform) (Employment Relations and Postal Affairs), Member, Labour Party National Executive Committee

The performance of the regional development agencies against their targets is laid before Parliament every six months. In 2005-06, the last year for which we have full-year figures, they helped to create or attract almost 19,000 new businesses, supported 800,000 businesses through Business Link, and assisted more than 166,000 businesses to improve their performance. Half-year figures for 2006-07 have been laid before Parliament and full-year figures will follow shortly.

Photo of David Heathcoat-Amory David Heathcoat-Amory Conservative, Wells

The figures that the Minister quoted were largely self-assessed by the bodies themselves. The truth is that those bureaucratic bodies show very little enterprise. Does he agree that a great deal of good would be done for businesses, and a great deal of public money would be saved, if he were to abolish them? He could then return the money to businesses through a cut in business rates, especially for small businesses, which would benefit the many, rather than the few businesses that are favoured by regional development agencies.

Photo of Pat McFadden Pat McFadden Minister of State (Department for Business, Enterprise and Regulatory Reform) (Employment Relations and Postal Affairs), Member, Labour Party National Executive Committee

The performance of the regional development agencies is not judged only through self-assessment. For example, the National Audit Office assessed all regional development agencies as performing either well or strongly. Let me quote a random comment from its verdict on the East Midlands Development Agency:

"emda has a strong vision for the region which has been developed and strengthened in successive productions of the...economic Strategy...emda's partnership working is a real strength, with an emphasis on building strategic delivery and in getting stalled projects to work again... The evidence base...is detailed and comprehensive and is well regarded by partners and stakeholders".

Photo of Charlotte Atkins Charlotte Atkins Labour, Staffordshire Moorlands

Will my hon. Friend investigate the different approaches of the RDAs to rural enterprise? For instance, the East Midlands Development Agency has supported an excellent farmers' co-operative initiative called Peak Choice, which was launched in my constituency last week. However, it appears that Advantage West Midlands—my constituency sits in the west midlands—is less willing to engage with rural developments and enterprise, even though Staffordshire, Moorlands falls within a rural action zone.

Photo of Pat McFadden Pat McFadden Minister of State (Department for Business, Enterprise and Regulatory Reform) (Employment Relations and Postal Affairs), Member, Labour Party National Executive Committee

Regional development agencies should be supporting business activity in both rural and urban areas. The output results for 2005-06 have been disaggregated on a rural and urban basis and can be found on the departmental website. I will be happy to take up my hon. Friend's specific question about Advantage West Midlands with the RDA on her behalf.

Photo of Peter Luff Peter Luff Chair, Trade & Industry Committee

On behalf of the yet-to-be-renamed Trade and Industry Committee and all its members, may I say how much I welcome the Minister and all his new and old friends, especially one old friend, to the Dispatch Box? Is the Minister aware of the Committee's recent report on UK Trade and Investment and its critical words about the failure properly to co-ordinate regional development agencies' work in overseas markets? What will be the role of another new friend, Sir Digby Jones? Will he be using all his traditional powers of tact and diplomacy to ensure that the regional development agencies are better co-ordinated in overseas markets?

Photo of Pat McFadden Pat McFadden Minister of State (Department for Business, Enterprise and Regulatory Reform) (Employment Relations and Postal Affairs), Member, Labour Party National Executive Committee

Comrade Digby, as we call him in the Department, will have a very important role to play. He has been outspoken on the issue, and I am sure that he will be a vocal and effective voice in ensuring a co-ordinated approach by RDAs working abroad.

Photo of Anne Snelgrove Anne Snelgrove PPS (Rt Hon Ruth Kelly, Secretary of State), Department for Transport

I add my welcome to the new ministerial team. Does my hon. Friend welcome the Prime Minister's announcement earlier this week that there will be regional committees of Members of this House, and does he agree with me that that will strengthen the relationship between the House and the regional assemblies, particularly with regard to enterprise and the economy of our regions? Will he encourage Opposition Members to join in with those regional committees with full enthusiasm, despite their aversion to regionalism?

Photo of Pat McFadden Pat McFadden Minister of State (Department for Business, Enterprise and Regulatory Reform) (Employment Relations and Postal Affairs), Member, Labour Party National Executive Committee

My hon. Friend makes a strong point. Such committees can play an important role. I shall just mention the kind of work that they could consider doing, in the context of current problems. For example, the RDA in Yorkshire moved very quickly in response to the recent floods; it has made £1 million available in business support. That is moving quickly, locally, in response to a local emergency. That is the kind of issue that could be examined productively by the committees that she mentions.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

On the point made by my hon. Friend Peter Luff, the Chairman of the Select Committee, will the Minister tell us what his new Department will do about the duplication that takes place in the RDAs' overseas activities? The simple fact is that to the Indian market, to take just one example, the United Kingdom is a very small place, and the differences between the west midlands and the east midlands, or the north-east and the south-west, are irrelevant to that market. We want business to come back to UK plc, and once it gets back here, we will decide where it goes. What will the Minister do about that particular problem, and that waste of money?

Photo of Pat McFadden Pat McFadden Minister of State (Department for Business, Enterprise and Regulatory Reform) (Employment Relations and Postal Affairs), Member, Labour Party National Executive Committee

As figures published this week show, the UK is performing extremely well in attracting inward investment from abroad. Of course we have a duty to make sure that our efforts are properly co-ordinated, but we would not accept a situation in which it was suggested that something was seriously hampering our efforts to attract inward investment; the record shows that we are an extremely attractive location. The hon. Lady mentioned India. She will know that the UK is home to about 60 per cent. of Indian inward investment in Europe. I think that we are performing well in the Indian market. I am sure that we could do better in that market and in others, and I assure her that my colleagues and I will do everything that we can to make sure that that is the case.

Photo of David Taylor David Taylor Labour, North West Leicestershire

As a newly elected Labour and Co-operative MP in 1998, I was happy to serve on the Regional Development Agencies Bill Committee, in which we considered what later became the Regional Development Agencies Act 1998. At the time, I received reassurances from Ministers that the RDAs would have a specific brief to encourage co-operative and community enterprises. There have not been too many signs of that, particularly in the east midlands, where an investigation is taking place, in which I played a part last week. Will the Minister look again at how best we can tap the potential of a principle whose time has come, in many ways?

Photo of Pat McFadden Pat McFadden Minister of State (Department for Business, Enterprise and Regulatory Reform) (Employment Relations and Postal Affairs), Member, Labour Party National Executive Committee

I agree with my hon. Friend that the co-operative sector is an important part of the economy, and it can be a very successful part of it—indeed, it is, in many ways. The RDAs should take that into account in their work, but I am happy to have further dialogue with him. The RDAs should be responding in a comprehensive way that supports all kinds of businesses, including co-operatives.