Economic Regeneration (Plymouth)

Part of the debate – in Westminster Hall at 1:16 pm on 6th February 2001.

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Photo of Beverley Hughes Beverley Hughes Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions, Parliamentary Under-Secretary (Department for Environment, Transport and the Regions) 1:16 pm, 6th February 2001

I congratulate Mrs. Gilroy on securing the debate and on her comprehensive and informed speech about the importance of partnership in her area. I hope that my short reply can do justice to it. My hon. Friend's speech demonstrated her commitment to her area, and I acknowledge her important role as a local Member of Parliament. She has been an assiduous campaigner, working with Ministers to secure the best for Plymouth. The catalogue of benefits gained since 1997 is as much a testimony to my hon. Friend's highlighting of Plymouth's needs as it is to the Government's commitment to such areas.

My hon. Friend outlined Plymouth's strengths and weaknesses. She spoke about the city's ability to respond to economic change and to diversify. She spoke, too, of the skills and experience of Plymouth's people, and the city's resource strengths, including its industrial and economic base, excellent training facilities and transport. Those factors help to position Plymouth now and in the future. My hon. Friend also rightly identified key problems and highlighted areas of Plymouth that suffered more than most from long years of neglect under the previous Government. She drew attention to pockets of significant disadvantage, which must be tackled.

I was pleased that my hon. Friend referred to the Government's various commitments to Plymouth--partly through the RDA, but also more directly as the city has benefited from a number of Government initiatives. Certainly the RDA is working closely with local partners and the community in Plymouth, and RDA investment commitments are approximately £18 million currently. These include expansion of the hugely successful Tamar science park, which the Prime Minister opened last year, and several other important initiatives for economic development.

My hon. Friend touched on Government support in several areas. Time does not allow us to go through them individually, but some important direct assistance from Government is provided through the single regeneration budget. Plymouth won nearly £24 million in SRB funding in recent rounds, helping some of the most deprived communities in the area. It was also successful in securing continued objective 2 status within the south-west programme, which is worth a total of £108 million in European grant over the period.

However, my hon. Friend also identified area-based initiatives that have been a hallmark of what the Government have tried to do on regeneration. Plymouth is one of a small number of areas across the country that has secured a "full house" in terms of employment, education and health action zones. There are sure start and new start programmes too, and I am delighted to be able to tell my hon. Friend--she probably already knows--that Plymouth is one of the 66 areas recently invited by my right hon. Friend the Secretary of State for the Environment, Transport and the Regions to bid in round 4 of sure start 2, something for which she has campaigned for some time.

We look forward to receiving, next month, a full delivery plan for the local new deal for communities, which the partnership has been putting together. That could bring up to £50 million of funding to the area for regeneration, again tackling some of the areas that most need help. My hon. Friend mentioned the new deal, and I think that it has had tremendous success in Plymouth. It has helped more than 2,150 people aged between 18 and 24 into work, and has, very importantly, a retention rate of approximately 70 per cent. That has made an important contribution to the fall in unemployment, particularly among young people.

Last October, we announced the neighbourhood renewal fund. Among areas with a multiplicity of difficult issues to tackle, Plymouth became one of four areas in the south-west that will benefit from neighbourhood renewal funding. That will help to improve housing, raise school standards, reduce crime and improve health in some of the most deprived communities. My right hon. Friend the Secretary of State announced in January an increase in Plymouth's funding under the neighbourhood renewal fund to £4.8 million over three years. Clearly the NRF will play a key role in the Government's wider strategy to improve prosperity, tackle poverty and create opportunities for all.

As my hon. Friend has said, a great deal has already gone into Plymouth, and rightly so. Further regeneration opportunities will continue to come from the Government, but it is gratifying to see that we are already able to demonstrate--and my hon. Friend is able to talk about--the effects of what we have done so far. The Employment Service in Plymouth has placed more than 6,800 people in work since April, of whom 2,500 were long-term unemployed.

That incredible achievement will make a lasting difference to the vitality of the economy of Plymouth, not just helping individual families, though that is important, but maintaining stimulation of the local economy, which will benefit everyone. I am delighted that unemployment in Plymouth has fallen to 3.2 per cent., a reduction of nearly 30 per cent. over the past 12 months. The rate is now below the national average for the first time in many years in Plymouth. Real measurable improvements in performance are having an impact on people's lives and on the local economy.

My hon. Friend touched on the importance of partnership in stimulating and sustaining that kind of progress, and I agree with her on the importance of partnership between central and local government and the strengths of local partnerships. I welcome my hon. Friend's eagerness for Plymouth to be at the forefront of developments in partnership. On the neighbourhood renewal fund, the requirement to have a local strategic partnership to administer the fund is an important step. Local strategic partnerships should build on existing good practice to rationalise existing partnerships, to improve on working practices and to cut down on bureaucracy.

We expect local strategic partnerships to rationalise some current processes and to create savings in the work involved in sustaining a number of partnerships. They will have scope to join up funding in creative ways and to decide priorities, so long as they meet targets on four big issues: crime, housing, health and jobs. It will be up to the local strategic partnership to decide the priorities for how that money is spent. It is implicit in what my hon. Friend says, and I agree that we need mature local authorities to fulfil the strategic roles that we have given them in leading and nurturing effective partnerships, both locally and between the local area and central government.

I want to refer to funding, which my hon. Friend raised. Plymouth has received funding through the local government settlement, and I am disappointed by erroneous accounts that have appeared in the local press. Plymouth will receive more than £5.5 million more in general grant this year than it did last year. That position has been protected by the introduction of the floor. In addition, there will be a 12 per cent. increase for education and nearly 21 per cent. more for social services, giving a total increase in ring-fenced grants of 4.5 per cent., which is twice the rate of inflation. That should give substantial assistance to the council.

I cannot comment on the council's priorities; I do not have the total picture. I think that my hon. Friend was right to question some of those priorities. There may be a case for doing so, in certain circumstances.