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Alan Johnson MPThe Institute of Chartered Accountants |
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I am delighted to be here this evening to help you launch the Institute's new regional business centres. Regional development and regeneration will be one of the core themes for this Government in our new term. As you know, I've recently taken up the post of Minister of State for Employment Relations and Regions, and I look forward to working closely with you as we move this agenda forward. Our goal is to spread the very real prosperity we are seeing in some parts of the country across the nation as a whole. We will do this not by penalising the successful regions, but by widening the winners' circle, so that opportunity is spread more widely. I want to describe the progress we have made so far, and the steps we are planning to take to achieve this. First, we have established the Regional Development Agencies, to serve as a focus for the economic development of the regions of England. We have worked with them in a systematic way, first to focus on the job in hand and then to give them the resources to move things forward. In order to be effective, it was important that the RDAs gained a clear view of the capabilities, opportunities and weaknesses of their regions. And it was equally important that they should not arrive at this view in isolation. This is why the RDAs engaged with the key stakeholders in their areas - companies, universities, local authorities and others, in the development of their regional economic strategies and associated work on innovation, skills and other key issues. Some have said that the RDAs are all talk and no action. I strongly disagree with this view. If their work is to be effective, it is vital that it must be based on an informed, critical and long-term view of the region's capabilities. Otherwise, there is a risk that the action will be badly directed and ineffective. Nor is the strategy a once-and-for-all document. The RDAs are engaged in refreshing their strategic work, and will continue to do so as time goes on, involving a wider and wider range of partners in the work. However, we recognise that the strategies are only a means to an end, and that end must be creating the foundations for sustainable prosperity in every region. Each region is different, and so are the problems it faces. Some face a painful transition from industries of the past to those of the future, with all this entails for individuals and communities. Others have to face the problems of success, where transport, planning and housing become key factors in sustaining prosperity. Geography impacts on each differently, and in each case the relationship between urban and rural, between international city and market town is different. This is why one size cannot fit all, and why, as well as giving the RDAs the resources to move their strategies forward, we needed to give them the freedom to tailor what they do to local needs and circumstances. We have taken action on both these fronts. First, we are vastly increasing the resources available to the RDAs. Their total funding is rising from £1.2 billion in the 2002-3 financial year to £1.7 billion in 2004-5. This represents a real vote of confidence in the RDAs and their capacity to deliver. In my own Department, for example, we are providing an extra £50 million a year aimed at boosting innovation and cluster activity in the regions. The RDAs will also work closely with the Small Business Service on the £70 million fund for the development of incubators announced earlier this year and in the planning for the roll-out of broadband nationally, which is to be supported by £30 million of additional money. We want to see the RDAs creating the capability, whether in terms of infrastructure, skills, premises or know-how, to bring about innovation in every region. It is just as important that the RDAs can be flexible in what they do. When we established them, we gave the RDAs a wide range of existing Government schemes to run, such as the Single Regeneration Budget, our regional land and property portfolio and many of our rural programmes. Since then we have added other new and existing schemes. This meant that although the RDAs were managing substantial resources, they were also having to deal with a huge number of detailed scheme rules, and that they lacked the flexibility to use these resources in a way which responded to regional needs. Because of this, we have decided to simplify matters radically. From the next financial year, all the money the RDAs receive from Government will go into a single budget. For the RDAs, this will mean the flexibility to deploy money from six Government departments flexibly to meet the aims of the Regional Economic Strategy, with a vastly reduced amount of associated bureaucracy. For Government, there will be a clear and accountable relationship through corporate plans, which will be agreed with the RDAs and which will give them clear targets to measure progress in meeting national and regional priorities. We believe this is a real step forward. Another important area is the development of partnerships. I was delighted to read that your regional business centres are intended to engage with business and Government in the local community. This is exactly the sort of initiative we wish to encourage, and I look forward to hearing more about their progress. In Government, we too need to ensure that we are joined-up. This is why the regional operations of the Small Business Service and Invest·UK are being co-located with the RDAs. It is also why the RDAs will be working with the Learning and Skills Councils, the Employment Service, companies, colleges, unions and others to establish regional frameworks for employment and skills. In this way, for example, we can ensure that a major investor in a region is able to receive an integrated package, including the right premises and people with the right skills, when he decides to move into an area. Since I am new to the regional brief, if not to the Department of Trade and Industry, you will rightly want to hear something from me about the future. As I said at the outset, the regional agenda is of great importance to this Government, and the key to regional success is economic prosperity. This is why the primary responsibility for the RDAs has been transferred into the DTI. We want to establish a virtuous circle, in which factors such as training and education, regeneration and infrastructure both create an environment in which business can grow and flourish, and in turn are nurtured by the prosperity it brings. Our aim is to establish the single budget regime and to agree corporate plans with the RDAs which will help to bring this about. But we also need to look beyond the immediate agenda to the long-term future of our regions. As John Prescott made clear in a speech during the election campaign, we intend to make it possible for regions to hold referendums for regional chambers, and will be publishing a White Paper on this soon. As John said, every region is different, and the powers and functions a regional chamber could have may differ too. We don't intend that they should duplicate things which are already being done effectively by local government, central government or the RDAs. But we do see a need for a body to take a strategic view on regional issues such as transport, development, the environment and planning. We also see that in many regions there is a desire to bring decision-making on these key issues closer to the people. We will be pushing this agenda forward in the coming months, and listening to the response of the people in the regions. I am sure that you too recognise that changes are taking place in the relationship between the constituent parts of the United Kingdom, whether at country-level between England, Scotland, Wales and Northern Ireland, or at regional level within England itself. You have recognised that this is a positive thing, and are changing the structure of your organisation to respond. That is what we are doing in Government too. I believe we have much to learn from one another. I wish you every success with your new regional venture, and I look forward to hearing about strong and lasting progress in the future. |
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Other speeches by Alan Johnson MP
(the following are available from the archive) |
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