Chancellor talks through the six-point long term economic plan for the Midlands.
What the Prime Minister and I want to secure is a great future for the Midlands – a future as an engine for growth for the whole of the UK.
That is what our long term economic plan for the Midlands will achieve.
Over the last thirty to forty years the Midlands grew significantly slower than the rest of the UK.
Our ambition is to reverse this trend and make the Midlands an engine for growth.
We’ve made a good start – with growth, jobs and productivity rising faster here than the UK average.
Now we need to sustain this progress.
The Prime Minister has given you the ambition and the vision behind the plan.
Let me take you through each of the six points of in detail.
First, our ambition should be to raise the long term growth rate of the Midlands to at least the average rate of the whole UK.
The Midlands has had an average growth rate of 3.7%, below the UK average of 4.2%.
Although the Midlands accounts for 16% of the UK’s population, it only accounts for 13% of the total economic output.
Only a small difference on paper, but over time this leads to a notable difference in prosperity
It’s driven by a gap in productivity. In other words, the ability to get the most out of this area’s transport, science, and above all, talented workforce.
If we can change that, and raise the Midlands growth rate to that of the UK average, then we could add an extra £34 billion to the Midlands economy in real terms by 2030, equivalent to over £3,000 per person.
The second point of our plan is about jobs.
If we maintain the high rate of job creation in the Midlands that we’ve seen under this government then we could have over 300,000 more people in employment by the end of the next Parliament.
We do that by identifying and then backing the strengths you have here in the Midlands in the private sector.
By backing the core strengths of the local economy…
like advanced manufacturing with JCB at Uttoxeter, Toyota, Rolls Royce or Bombardier here in Derby…
or Jaguar Land Rover across the Midlands…
or engineering with GE Power Conversion in Rugby or Alstom in Stafford…
And the many, many small and medium sized businesses that make up the supply chain.
We won’t have successful businesses unless we have skilled people.
That’s why the third point of our plan puts skills at the heart of the economic revival of the Midlands.
Today we propose a new approach.
Andy Street – the Chief Executive of John Lewis and Chair of the Birmingham and Solihull Local Enterprise Partnership – has agreed to work with local businesses – and bring all their vacancies together for the first time in one place.
This will make it to make it easier for local jobseekers at all levels, from school leavers, to middle managers and skilled engineers to find good jobs.
And to match these people to good jobs we will invest in 100 new job coaches to help them access the training and apprenticeships they need to get work.
It is a brilliant new idea from Andy and the Local Enterprise Partnership and we’re backing it.
Next we are going to expand the Birmingham Baccalaureate – it’s a fantastic scheme, championed by the CBI, where pupils work on projects designed by local large employers so we’re certain they’re acquiring the right skills.
I want every secondary school in the city to be able to take advantage of it.
Next we want to expand the best and most prestigious apprenticeships across the Midlands, by helping top employers to place their apprentices into smaller firms in their supply chain.
We have a number of world-renowned firms here in the Midlands who are massively oversubscribed for apprenticeships. Rolls Royce have had up to ten applications for every place on some occasions.
I know Bombardier are similarly over-subscribed, and you and other employers have told us that you are keen to explore how we can create more apprenticeships by extending your schemes to the companies in your supply chains.
This would mean more highly skilled apprentices and is a great idea, backed by local firms and something I will return to at the Budget.
And today I want to make an offer on skills to the whole of the Midlands.
For some time now there has been a discussions about doing what a number of other urban areas in our country have done, like Greater Manchester and West Yorkshire, and creating Combined Authorities, to solve metro wide problems.
I know, for example, that in the West Midlands discussions are ongoing. On the right terms, I hope that agreement can be reached this year.
This is the offer. Before the end of the year I want to be able to devolve power over skills, which is currently centred in Whitehall, to the Local Authorities and Local Enterprise Partnerships in the Midlands.
My condition is that I want to see the different areas combine together to produce a strong joint plan. The same employers and supply chains work together seamlessly across this part of the country, so local leaders need to do the same.
So skills are central to this long term plan for the Midlands.
But anyone in the room from a business – whether large or small – will tell you that good transport connections are a prerequisite for firms to flourish and expand. That’s why transport is the fourth part of our plan.
We today commit £5.2 billion to create a modern, interconnected transport network for the UK – centred around the Midlands.
We can only afford this because we have made this a priority and made difficult decisions in other areas like the welfare budget.
It amounts to the biggest investment in transport infrastructure here in the Midlands in modern history.
This isn’t a vague commitment. We are allocating specific sums to road and rail projects here in the Midlands.
One of the first decisions I took as Chancellor five years ago was to give the go-ahead to a £650m re-development of Birmingham New Street station. It will be completed in September this year.
The £570m extension of Nottingham’s tram network will also be completed this year, with 17.5km of new track and 28 new tram stops.
Now we’re electrifying the Midland Main Line from St Pancras to Sheffield, via Luton, Bedford, Kettering, Corby, Leicester, Derby, Nottingham and Chesterfield
And that’s all on top of the massive investment in HS2, bringing huge benefits to the Midlands by way of enhanced connectivity, capacity, regeneration and more jobs.
I want to see the plans for a High Speed Rail Investment Summit in Birmingham.
I’m also committed to improving rail connections across the Midlands – today I am asking Network Rail to look at the case for electrifying the main line between Bristol and Birmingham and Derby and Birmingham.
I can also confirm that later this year we will begin work on improving the major motorways of the Midlands - expanding the M1 to four lanes across the whole Midlands and expanding the M5 from junction 4a to 6.
So investment in major transport infrastructure is key to our plan for the Midlands, but so is backing the world leading science and innovation in the Midlands.
That’s the fifth part of our plan.
A very exciting idea is being developed right here.
Leading universities, including Birmingham, Nottingham, Warwick, Loughborough, Aston and Leicester, are working on an exciting proposal with the British Geological Survey for a new national hub for energy research.
We’ve seen the new Crick Institute for biomedical research in London, the Royce Institute for Advanced Materials get the go ahead in Manchester.
I am waiting to see what could be the next credible proposal for science investment in the UK. The ideas on energy from local universities here could be it.
Of course, the decision must be taken according to independent scientific criteria as part of a competitive process.
But it is in your hands to develop these exciting proposals and others, so the government is well placed to take the funding decision later in the year.
Then we have to turn good science into great innovation.
The Midlands is already known for its strength in automotive research and development. The MIRA Technology Park in Leicestershire is the one of the most successful Enterprise Zones in the Country, and a huge success for the Local Enterprise Partnership – having grown over 40% since 2010.
That growth is set to continue – with Continental, GKN, Haldex and Goodyear all moving into new premises on site this year.
To cement the Midlands and MIRA’s position as a world leader in automotive technology I can announce today that we will extend the Enterprise Zone.
Alongside this, the government is also announcing today further funding from the Regional Growth Fund – over £60 million is going to projects here in the Midlands, to back your strengths here.
We want to support innovation right across the Midlands, not just its largest urban areas. So I welcome proposals being developed in Hereford to create a new university – the government supports the establishment of universities in parts of the UK that currently lack higher education institutions.
And today I can also announce that we are going to help the brilliant food producers and farmers here too, by creating new Food Enterprise Zones – in Leicestershire, Warwickshire and two sites in Lincolnshire.
Once established, these will act as a hub for food and farming businesses across the region, streamlining planning processes and supporting growth within the supply chain.
Of course, beautiful countryside and the heritage here are just some of the reasons so many people visit the Midlands – so today we’re supporting investment in culture here too, from the refurbishment of Shakespeare’s house in Stratford Upon Avon to the Lincoln Tank Memorial project.
Prioritising skills, great transport and world leading science and innovation – these are the crucial ingredients to attract businesses and for the Midlands to be an engine for growth.
Of course, we want the people who work in those businesses, and their families, to have a great quality of life too – that’s the sixth and final part of our plan.
Good quality of life depends on good housing.
We will support the construction of up to 30,000 new, quality homes in the Midlands by unblocking stalled sites – and I can confirm that we’ve shortlisted bids for new housing zones in Bassettlaw, West Lindsey, Dudley and Sandwell.
I also want to kickstart regeneration on the housing estates in the Midlands.
We have already shortlisted four schemes in London to turn around some of the city’s most run-down estates.
I want to look at how we replicate that here in the Midlands.
Quality of life also depends on good schools.
There are today over 47,000 more Midlands children in outstanding schools than five years ago.
The first University Technical College in the UK, the JCB Academy, was set up in Staffordshire in 2010, and trains young people to be the engineers of the future – it’s now oversubscribed and achieving GCSE results well above the national average.
But we can do better still.
I’ve heard about the ‘Race to the Top’ initiative being launched in Northamptonshire today – a £1m investment in local schools and raising academic standards in the county.
It is a fantastic initiative and one which I give my full backing to today.
If we raise education performance here to the very best in the country we’d have over 150,000 more Midlands children in outstanding schools.
So let me be clear. We have a long term economic plan for the Midlands – establishing its future as an engine for growth in the UK.
It aims to add £34 billion to the local economy and 300,000 jobs.
It’s the biggest investment in transport in the Midlands in modern history.
It backs skills, science and industry.
It commits to raising the quality of life here through better housing and education.
It’s a prize worth having and with your help we will deliver it.