My Lords, I thank my noble friend Lady Massey for securing this debate, which has engaged so many excellent speakers. Like many speaking today, I was born and bred in the north of England and, although my working life has been spent elsewhere, my ties to the north are still very strong. In my home town of Bradford in Yorkshire, I have seen over the years both the decline in its traditional industries and the determination to recover its economic potential. So I read the IPPR’s annual health check on the northern economy with great interest. It contains some nuggets of good news, such as the latest GVA stats, which show that, in 2015, the north’s economy grew faster than any other part of the UK. It has now passed the £300 billion mark and is worth more than those of Scotland, Wales and Northern Ireland combined; apparently it is the 10th largest economy in Europe. There is no doubt, therefore, of the enormous economic potential of the northern powerhouse.
However, last year’s optimism has been replaced by the shadow cast over the region by the Brexit vote. Given the north’s dependence on EU trade—which is greater than that of anywhere else in the country—and the legacy of its industrial decline, the report argues that the north has the most to gain or lose from Britain’s exit from the European Union. One thing that I found most telling was that the northern areas most vulnerable to the economic turbulence caused by Brexit are those that voted most strongly to leave the EU. The report argues strongly that Brexit negotiations should focus on the needs of the areas that voted overwhelmingly to leave and that the Brexit vote in the north makes the Government’s northern powerhouse more important than ever. I agree: you have only to contrast areas such as Humber, Tees Valley and the Sheffield city region, which had the highest percentage of leave votes in the north, and the city of Manchester, which has benefited from economic development and where 61% voted to remain, to realise that the benefits of the northern powerhouse have been felt only in certain parts of the north so far.
As I have seen in visits to various parts of the north in my role as chair of the National Housing Federation, the,
“patchy development of combined authorities, metro mayors and devolution”,
mean it cannot as yet match the response of the devolved Administrations for Northern Ireland, Scotland or Wales, or even that of the Mayor of London. So I echo other speakers today in asking the Minister to recognise the IPPR’s call for a northern Brexit negotiating committee to determine the type of Brexit that would best suit the north and to unite the northern voice in negotiations. Does the Minister agree that to ensure sustainable productivity in the north there is a need to build direct relationships with regions and nations within and beyond the EU, to develop and enhance the north’s particular trade interests?
The author of the report calls the Brexit vote,
“a cry of community outrage at the imbalances of wealth and power, played out … within and between the regions”.
It is a reminder that many areas in the north, particularly those post-industrial communities outside the city centres, have not shared in northern economic growth, and are vulnerable, for example, to any post-Brexit restrictions on trade. I am therefore anxious, like my noble friend Lord Monks, that the Government’s new economic and industrial cabinet committee’s focus on,
“delivering an economy that works for everyone”,
to ensure that the,
“benefits of growth are shared across cities and regions up and down the country”,
could dilute our focus on the north. I fear that this would be a mistake. We must not allow support for the northern powerhouse to falter. The announced investment in infrastructure, culture, housing and the quality of life in the north, the devolution deals in Sheffield, Greater Manchester, the north-east, Tees Valley and Liverpool, and the work to raise education and skills levels, must be supported. Yes, this is important for the success of the north, but it is also important for the success of the UK as a whole.
My final point is that the two key issues of high-level skills and housing are inextricably linked. In the past 10 years, 75,000 highly qualified British residents have been lost from the northern powerhouse regions, which seems to have been masked by highly qualified workers coming in from outside the UK. In a poll of 2,000 graduates by an alliance of the north’s largest housing providers, 55% said that the quality of housing would be a key factor in deciding where to live if they were to move. Cost of housing was a very close second. Affordability and availability of housing is a unique selling point in the north. The alliance argues that if local authorities, housing providers, employers and universities came together, they could develop joined-up strategies to attract and retain many more highly qualified people. Does Minister agree that the Government could be instrumental in assisting them in developing innovative new products to buy or rent, specifically aimed at the graduate market, to attract the very graduates that the north so clearly needs?