Peter Aldous is optimistic about the future economic prospects for East Anglia but raises concerns that the Government's levelling-up strategy fails to take into account the challenges faced in many coastal, rural and urban communities in the region.
I beg to move,
That this House has considered the matter of levelling up in the East of England.
It is a pleasure to serve under your chairmanship, Ms McVey. I thank the Backbench Business Committee for granting this debate. I am also grateful to the secretariat and supporters of the all-party parliamentary group for the east of England, which I co-chair with the hon. Member for Cambridge (Daniel Zeichner), for the research that they carried out ahead of the debate, including their October 2021 publication, “Achieving Sustainable and Inclusive Growth: The East of England Offer”.
The east of England, traditionally known as East Anglia, comprises the easternmost counties of the United Kingdom: Norfolk, Suffolk and Cambridgeshire, and also Essex, Bedfordshire and Hertfordshire. The western and southern boundaries of the region are somewhat porous, and some of those living in, say, south Essex, parts of Hertfordshire and parts of Bedfordshire may not view themselves as being part of the east of England. That said, it is great that those three counties are so well represented in this Chamber this morning. Although at times understated, East Anglians are welcoming people. There is no hard border to the region, as the Devil’s Dyke was never completed and ceased to function well over 1,100 years ago.
Levelling up is in many respects the Government’s signature tune. The Prime Minister first spoke of the need to level up across Britain in his first speech as Prime Minister on 24 July 2019. The policy was the cornerstone of the Conservative manifesto at the 2019 general election, and we now eagerly await publication of the levelling-up White Paper, which will set out the strategy as to how levelling up will be delivered.
On that point, will the hon. Gentleman give way?
I will, and I look forward to the hon. Gentleman’s intervention.
I congratulate the hon. Gentleman and all his colleagues on their attendance. He mentioned the Prime Minister. The week before last, the Prime Minister stated, during Prime Minister’s questions, that the UK must
“get on with our job of levelling up across the whole of the UK, making sure that every part of this United Kingdom shares in our ambition to be a science superpower”.—[Official Report, 5 January 2022; Vol. 706, c. 19.]
Does the hon. Gentleman agree that consideration must also be given to the rest of the UK? In the north of England there will be £38 per head of population, and in Northern Ireland the money is even less. The aim must be to ensure that we all benefit—I think that the Prime Minister wants us all to benefit and that the hon. Gentleman wants that as well. Does he agree?
I wholeheartedly agree. Northern Ireland and the east of England have many things in common: Northern Ireland is the most western part of the United Kingdom, and I represent the most easterly constituency in the United Kingdom. Levelling up must go round the whole United Kingdom—north and south, but also, as we are hearing today, east and west.
The White Paper is long overdue, but I recognise that the once-in-a-generation challenge of covid-19 has diverted attention and I acknowledge that my hon. Friend the Minister and my right hon. Friend the Secretary of State for Levelling Up, Housing and Communities are still relatively new in office. Although we have yet to see the detail of the Government’s levelling-up policy, there are some early signs that the east of England might be overlooked. From my perspective, the purpose of this debate is to highlight that concern and to obtain from the Minister an assurance that that will not be the case—that our region will not be ignored and the needs of local people and local businesses will be fully and properly taken into account.
It is first necessary to set the scene as to what is happening in the east of England.
May I intervene before my hon. Friend moves on to broaden out his argument? He was talking about the east of England being overlooked in levelling up. Is there not an additional concern that, in the levelling-up agenda, the east of England will be seen as an area where more houses can be built and taxes can be raised to be spent elsewhere? Those two considerations are important parallel aspects of levelling up that affect the east of England, particularly constituencies in Bedfordshire.
I thank my hon. Friend for that intervention. He is right: if more housing is to be provided, the infrastructure to go with it needs to be provided. I will comment on that. I will also address the fact that the east of England is at the moment a net contributor to the Treasury, and if we do not invest in the east, there is a risk that we will destroy the goose that lays that golden egg.
At first glance, the east of England appears relatively prosperous, even though wages in many areas lag behind the national average. In 2019, the east of England accounted for 9% of the UK’s GDP, although it had a GDP per head below that of the UK as a whole. There are significant pockets of hidden deprivation, particularly in coastal communities, such as the Waveney constituency that I represent, and in rural areas. Those are often concealed, as they lie close to more affluent places.
My hon. Friend is making a powerful point, and I fully accept that coastal communities and some rural areas suffer from deprivation. However, new towns also have some of the most deprived wards in the east of England, particularly in and around Basildon. Levelling up is about levelling up opportunity, but it is also about levelling up those people’s own environments and communities, so that they stay there rather than feel that they have to escape their local communities.
I thank my hon. Friend for that intervention. Of course, he is right: one of the challenges we face is that, if we do not invest in those communities, there will be a brain drain from the region. It is for that reason that we need to invest in those regions. In that way, we will level up, and get rid of that migration from the region.
As I have said, the east of England is one of three net contributing regions to UK plc, and it should be emphasised that investment and support in our region will not only deliver levelling up but add to national prosperity. Much of the hidden deprivation is focused in coastal areas such as Lowestoft, where traditional industries such as fishing and manufacturing have declined over the past 40 years, although there is hope that fishing can play an important role in economic recovery through the Renaissance of the East Anglian Fisheries initiative. Kirkley, in Lowestoft, is the 26th most deprived ward in the country, and 10 of Lowestoft’s neighbourhoods fall within the 10% most deprived wards nationally. A 2019 study found that more than 12,000 people in Lowestoft and the rural area immediately to its north are affected by income deprivation. Some 20% of households in Lowestoft live on absolutely or relatively low incomes, and 21% of adults in the town have health issues that affect their activity, diminishing their participation in society, limiting their job opportunities and contributing to wellbeing issues. Finally, although 68% of adults in the town are economically active, 15.7% are in receipt of universal credit. That reflects the low-skilled and temporary nature of employment opportunities currently available.
It is also important to highlight one particular opportunity and one particular challenge in the east of England. The opportunity is presented by the UK’s net zero target, with East Anglia right at the forefront of the Government’s plans. Half of the UK’s offshore wind fleet will be anchored off our coast. There is the proposed Sizewell C nuclear power station, and there is the potential to retrofit the gas infrastructure, both in the southern North sea and on land via the Bacton gas terminal. Some 30% of the UK’s low-carbon electricity will in due course come through Suffolk alone. There is potential to completely transform the economy of the whole of coastal East Anglia, where many deep pockets of deprivation are found. To make the most of the opportunity from which the whole of the UK will benefit, the Government need to provide the necessary seedcorn funding. If that is done, we are not just talking about levelling up; we can provide a global exemplar as to how decarbonisation can be delivered to benefit local people and local communities.
A particular challenge that the region’s councils face is adult social care, because the east of England has a relatively elderly population. Following the comprehensive spending review and the provisional local government funding settlement, there is a real worry that one year of funding certainty is not enough. Councils need at least three years of certainty so that they can plan effectively and deliver services efficiently. There is a need for increased long-term funding for councils to close the funding gap that, by the end of 2022-23 for the east of England councils, will be in the order of £240 million. There is concern that the adult social care funding that has been provided is not enough and might not even cover the planned capital on care costs and changes to means testing. Councils face significant financial pressures owing to the rising costs of care, workforce pressures and national insurance uplifts.
I have highlighted the challenges that Lowestoft faces, but I should point out that the Government have responded positively and are currently making a significant investment in the town. Construction of the Gull Wing bridge and the Lowestoft flood defence scheme are well under way, and Lowestoft has secured a towns deal. Work on the projects is due to start later this year.
Does my hon. Friend agree that although we have infrastructure projects such as the bridge and so forth, when we talk about the anti-car debate in some of the towns, we must remember that some of our leafier suburbs do not benefit and we need transport infrastructure to keep our economy alive?
My hon. Friend is right that transport infrastructure is vital, and I will come on to that shortly.
Further afield from Lowestoft, the region will benefit from two freeports at Felixstowe and Harwich, as well as the Thames freeport. However, while we await the detail of the Government’s levelling-up proposals, there are some early warning signs that the needs of local communities in East Anglia might be overlooked, and there is a worry that we will not be able to realise the full potential of those projects for the benefit of local people and local businesses.
With regard to funding allocated in the comprehensive spending review, the east of England received the second lowest per capita spend of any region at £92 per head. Only London received less. The UK average is £184 per person, and in Yorkshire and the Humber the provision is £359 per head. In the first round of the levelling-up fund, the east of England secured £87 million. That is £13.88 per capita compared with a national average of £23.91 and £41.72 per capita in the east midlands.
There is also concern about the prioritisation of both the levelling-up fund and the community renewal fund. As I have mentioned, Lowestoft has deep pockets of deprivation, yet it is neither a priority 1 area for the levelling-up fund, nor a priority place in the community renewal fund. It is essential that that inequity is put right ahead of the next round of the levelling-up fund and the introduction of the UK shared prosperity fund.
There is also a worry that, notwithstanding opportunities in the east of England in such sectors as low carbon, agri-tech and life sciences, the Government are actively seeking to discourage Government spending on research and development in the east of England. In the Budget Red Book, the east of England is coupled with London and the south-east, which are very different from much of the region, as an area from which Government spending on R&D will be diverted and where it will be discouraged.
No debate on the east of England would be complete without highlighting the region’s infrastructure deficiencies in traditional modes of transport—road, rail and bus—and digital connectivity. In many ways, we are a victim of our own geography, which in other respects is one of the region’s unique selling points—a relatively dispersed population with relatively small urban centres, and a network of market towns and villages interspersed with attractive countryside—which serves not only as the breadbasket of the UK but as the home to many flourishing rural businesses. If that infrastructure, both old and new, is not upgraded, I fear that the region will not realise its full economic potential and it may be difficult for it to continue to be a net contributor to the Treasury’s coffers.
I will highlight five compelling reasons why we need to upgrade the region’s connectivity. First, the east of England, with 13 ports, including two freeports and four airports—Stansted, Luton, Southend and Norwich—is the UK’s international gateway. If we do not have good road and rail networks from these access points, through and out of the region, it is not just East Anglia that suffers—there will be a negative knock-on impact for the whole UK. Half of the UK’s containerised goods are moved through the region; 70% go to the north of England and support businesses and communities right across the UK. Air freight is critical to maintaining and growing the UK’s ability to trade globally. Stansted is the only London airport with the capacity and infrastructure to support increased demand for cargo aviation over the next 10 to 15 years.
East Anglia’s road and rail network is crucial to the smooth movement of these essential supplies coming into the UK, whether by sea or by air. Poor connections lead to slow, unreliable journeys adding delay and cost, which ultimately the consumer ends up paying for. For this reason, roads such as the A12, A14, A120 and A47 urgently need to be upgraded.
Secondly, linked to this, our railways need to be improved, to accelerate the shift of freight off the roads and improve services to London, to which many of the region’s residents commute. The upgrades at Haughley junction and Ely junction are long overdue. Thirdly, improved transport infrastructure is needed to tackle those pockets of coastal deprivation to which I have referred. Many of these communities have poor transport links without dual carriageway connectivity and with low-frequency train services.
I thank the hon. Gentleman for giving way and making such an excellent contribution to this debate. I notice that on transport infrastructure, he seems to be looking at a very 20th-century model, as if the climate crisis was not happening. Will he talk a little more about the kind of rapid transit systems that he envisages would take individuals off the roads in their cars and move them on to buses and trains, freeing up more of that road network system and helping the environment and ecological systems that are in place?
I thank the hon. Member for his intervention—he is right. As far as road investment is concerned, we have to make up for work that should have been done a long time ago. Rail network improvements are vital to the future, as he has mentioned. I have mentioned two junctions at Haughley and Ely; I could be greedy, we need Trowse in his constituency and Bow to improve the access to London as well. Those need to be addressed.
I will now briefly address the digital connectivity which is so vital to the future.
Before my hon. Friend moves on to the very important issue of digital connectivity, may I highlight the fact that in the south of Essex there are some proposals to consider a tram network? There is one very important road that he missed out of his list—the A127. It is not part of the national infrastructure, but it provides a vital route out of London down to Southend, through some of the busiest areas and areas that have the greatest opportunity to deliver the levelling-up agenda. I will just put those points on his radar.
I am grateful to my hon. Friend for doing so, and I apologise if my speech is somewhat focused on the east of East Anglia. He is quite right to highlight the challenges and opportunities in the south of the region.
Finally, I will say that full-fibre connectivity for all households and businesses is vital if East Anglia is to reach its full economic potential. There are projects to deliver that connectivity in many towns across the region, including Cityfibre’s £15 million investment in the network across Lowestoft. However, there is a concern that digital deserts may emerge in some rural areas, so it is vital that the Government’s Project Gigabit programme is ramped up and is fully comprehensive.
For East Anglia to realise its full economic potential and provide local people with the opportunity to work in the exciting new emerging industries, a skills revolution is needed. The Skills and Post-16 Education Bill provides the framework to deliver that revolution, but there is a concern that the region may again be bypassed.
Sizewell C is an enormous project, which can bring great benefits to Suffolk, Waveney and further afield. It is estimated that during the 12-year construction period, £2 billion will be put into the Suffolk economy. During that period there will be three apprenticeship cycles and 1,500 apprenticeships. There is an opportunity to leave an enduring legacy of knowledge and skills, which in the long term—once Sizewell C is completely constructed and becomes operational—can make Suffolk and Waveney a compelling location in which to set up and grow a business.
Sizewell C is exactly the sort of project that requires a gear change in training, which an institute of technology would help to deliver. However, the proposal from the University of Suffolk, East Coast College, the College of West Anglia and Norwich University of the Arts has not been successful in the institute of technology competition, in which the second wave of successful bids has just been announced. In the first two waves, 21 institutes of technology have been created, which provide comprehensive coverage across the country; and yes, there is one at South Essex College at Chelmsford, but there is a vacuum in the east. I will follow this matter up with the Minister for Higher and Further Education, my right hon. Friend the Member for Chippenham (Michelle Donelan), to find out why the bid for our area was rejected, but there is alarm that the necessary investment is not being made locally to ensure that the region fully benefits from the exciting opportunities that are emerging.
I have spoken for far too long; I must allow others their say. Generally, I am excited about the future economic prospects for East Anglia, as they provide the opportunity to reverse 40 years of economic decline in coastal communities such as Waveney. However, I have concerns that these issues are not fully taken into account in the emerging levelling-up strategy. In the east of England, it is crucial that the Government recognise the challenges faced in many coastal, rural and urban communities, and that they upgrade connectivity and invest in skills. If we do not do these things, we will not eliminate those deep pockets of deprivation, there will be a negative spin-off across the UK and the region’s ability to continue to be a net contributor to UK plc will be in peril. I hope that the Minister can allay these concerns in his summing-up.
We have had a comprehensive debate. I apologise if I took too long setting the scene. I would like to highlight some of the issues that have arisen. There has been great emphasis on bidding for capital projects, but improvement to our core funding—education, health and police—is vital. Likewise, on new housing, the infrastructure must come at the same time.
We heard from the hon. Member for Cambridge (Daniel Zeichner), my APPG co-chair, who mentioned the importance of noting that if we take out the London effect and the Cambridge effect, suddenly the east of England really does have challenges. I focused on coastal and rural deprivation, but there are deep pockets of deprivation in our urban centres that need to be addressed. On connectivity, there is no debate on East Anglia that does not highlight our poor infrastructure—both the deficiencies in the past, and looking to the future with that digital connectivity. On devolution, I liked what the hon. Member for Norwich South (Clive Lewis) said about the importance of centralised intent—