Tees Valley Inward Investment Initiative
Debate between Lord Wharton of Yarm and Iain Wright
The Parliamentary Under-Secretary of State for Communities and Local Government (James Wharton)
I congratulate the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) on the broad thrust of his speech. I think we can all agree that Teesside is a wonderful place that provides incredible opportunities, and that we should now focus on how those opportunities can best be delivered.
The Tees valley has many great strengths. Teesside contributes more than £12 billion to the national economy each year. Its rate of new business creations is higher than the UK average, and unemployment has fallen from about 31,400 in December 2014 to 27,000 in December 2015. However, that does not mean that it has not faced real challenges, of which the hon. Gentleman gave specific examples. He also gave us his thoughts on both the work that has been done and the work that still needs to be done to overcome some of the difficulties that our economy has faced.
The Tees valley economy has been growing for some years, but it has certainly faced difficulties. We must now focus on what is great about the area—what we can sell and what we can talk about, and how we can promote the economy to those who might wish to invest in it—but also on how we can gain the maximum benefit, and unlock the potential that exists. There is some good news. In February, Lord Heseltine and I attended PD Ports’ launch of its new £35 million redevelopment and expansion. In March, Cavitech opened its new office. Nifco, a company in my constituency, has expanded into two new facilities over the past four years. On Friday I opened the new offices of Odyssey Systems in Stockton, which means the provision of IT services, the creation of jobs, and investment in the Tees valley. There is, in fact, a great deal of good news, but there are also those challenges, which still need to be addressed.
Lord Heseltine’s report is an important part of the process. It is an important step in the journey towards both identifying opportunities and addressing them when we are able to do so. It is an independent report: although it was commissioned by the Government, it does not set out the Government’s position any more than it sets out the position of the local authorities, businesses and universities that contributed to its production. It contains a wide range of recommendations, many of which have been broadly welcomed, although there is, of course, debate about how some of the challenges that it identifies should be addressed. That debate is welcome.
The hon. Gentleman made clear his views about what night be done in future. I shall be happy to work with anyone who has the best interests of Teesside and the Tees valley at heart, to consider any specific recommendations and work with the Government to establish whether they should be delivered, and, if we conclude that they should, to ensure that that happens whenever possible.
Teesside has a complex local economy. We have experienced the great shock of the loss of SSI in Redcar and its impact on the economy—not just the impact on those who were directly employed, but the impact on those in the supply chain. We are left with a site which is in itself challenging, given the need for remediation, investment and support to bring employment back to the area, but which is also part of a bigger picture along the banks of the Tees, speaking not just to a glorious industrial past but to the incredible potential for a brighter future. That is why I very much welcome and support the establishment of the mayoral development corporation in its current shadow form. It is populated by some well-informed and capable business people and the leaders of our local authorities. It is bringing together many of those who want to make a contribution to the future of the Tees valley economy, and it has a remit that stretches further than the SSI site, which looks down the banks of the Tees, to what can and needs to be done.
The hon. Gentleman is right that a great deal needs to be done. We are still in the early stages of dealing with the official receiver, who has a job to do. Government and the board and the GovCo that sits under the Department for Business, Innovation and Skills are talking to the official receiver about the best way through the process, to give us the best chance of making a success of the site that is left at the end of those discussions and, at the end of that, when it is handed over fully to Government. We are in talks with local businesses about identifying opportunities, and work needs to be done to understand the needs of that site and to understand the clean-up, the infrastructure potential and the opportunities to attract investment. That stands at the heart of the issue we are here to discuss today: the investment we want to attract to Teesside.
In Lord Heseltine’s work in the Tees valley in recent months, he has worked with UK Trade & Investment to identify where Government can assist in bringing investment to the area, and to identify those potential investments that will help to drive regeneration and create jobs. I welcome that work and I know he is looking to support it where he can, and I have had discussions with a number of potential international company investors who could bring jobs and work to the Tees valley. I know that work will need to continue if we are to ensure employment is brought to that former site and into the broader area over which the development corporation will operate. This will go hand in hand with the Government’s programme of devolution.
Tees valley is at the forefront of the devolution agenda and will be one of the first areas to have elected a new metro-mayor, in May next year. It has agreed a deal with Government, but I want it to go further—to agree more, to take more control and to take more powers from central Government so they can be exercised closer to the people who are affected by the decisions the new mayor would be able to make for that local economy. None the less, it is on that journey and those talks are under way.
The hon. Gentleman spoke of areas of industry that he felt needed more attention than they have perhaps been given in the past. I can assure him I have had numerous meetings with Sirius to talk about the mining potential not just from its investment in north Yorkshire, but also through into the Tees valley, and the difference that can make to our economy locally and the jobs it can create.
The hon. Gentleman talked about logistics, which offer a huge opportunity for the Tees valley. The port is a great asset, is one of the largest and most successful in terms of tonnage in this country, and it is already making a significant contribution, but I have no doubt that it can do more and should be supported to do so.
Mr Iain Wright
The Minister mentions industries and sectors and I want to mention two more in which we have comparative advantage: the processing chemicals industries, with NEPIC leading; and the great potential in the offshore wind supply chain cluster. What tangible steps will the Minister and Government take to ensure we can accentuate the positive and fulfil the potential of these industrial sectors?
James Wharton
The hon. Gentleman makes an important point. Teesside is of course internationally respected for the chemical processing industry; not just NEPIC but CPI and the work done in that sector provide good jobs, long-term investment and real opportunity to attract more. We always want to continue to support that. As part of the process of looking for international investors, we are looking to support those organisations to see where more investment can be brought in. The chemicals and processing industry will form part of the story going forward of the sites that the MDC will become responsible for and the work it is doing.