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Hansard 12 Nov:Column 573 ...
Hansard 12 Nov:Column 573

Liberal Democrat MPs from both sides of the border last night detailed the problems facing the regional economy of south east Scotland and north Northumberland, which has been hit recently by more than 2,000 job losses, mainly in textiles, electronics and agriculture-related businesses.

Scottish Office minister Calum Macdonald assured them the government was tackling the region's difficulties, in conjunction with local authorities, Scottish Borders Enterprise, the private sector and other agencies. It had established a borders working party to tackle the employment and economic development issues.

He revealed that the government was ready to grant additional capital consent to Scottish Borders Council for a specific project that is currentlky undr discussion, if the company involved decided to go ahead with a proposed expansion.

Archy Kirkwood, MP for Roxburgh and Berwickshire, said all the relevant public sector bodies in the local economy were working closely together. He added:'Their co-ordination is excellent and their motivation is obvious, but the budgets within which they are struggling to work were cast at a time when no one could foresee what would happen, although we warned ministers in the previous administration that the textile industry was in a fragile state. Notwithstanding that, no one could have predicted 12 months ago that things would be as bad as they are'.

He said government should investigate 'every nook and cranny' of any budget available through local authorities or the Scottish Enterprise mechanism to see whether any small underspends, additional resources, capital assets or capital consents can be deployed to help the area cope with the short-term problems it faced. Ministers should honour their pledge to determine whether any underspend had occurred in the present EU objective 5b structural funding programme and to divert any underspend to areas such as the borders and north Northumberland.

Help was also needed from government in applying for the new objective 2 category of EU structural funds in the next funding programme.

Mr Kirkwood added: 'We also need help from central government with our application to future access to regional development assistance. The map is being redrawn currently, in co-operation with the department of trade and industry, but if we do not get help we will face depopulation in the next few years. That will damage the local economy and we will suffer the consequences for many years to come'.

He was supported in his arguments by colleagues Alan Beith, MP for Berwick upon Tweed, and Michael Moore, MP for Tweeddale, Ettrick and Lauderdale.

Mr Moore commented: 'The thoughtful proposal by the local council in partnership with the enterprise company and others highlights the fact that the problem with unemployment figures is that they do not take any account of the many people who leave the area. Indeed, too many people may be forced to leave our part of the country'.

Mr Macdonald said the government's initial response to the job losses at Dawson International and the diffuclties at Viasystems had been to announce in July a package which included£1m further funding for Scottish Borders Enterprise and the establishment of a rural inward investment team by Locate in Scotland.

The government was very aware of the need to work in partnership with the local authority and the local enterprise company to deal with the economic problems in the area, not only immediately but in the longer term. The Scottish Office had set up a borders working party whose core membership was officals from the Scottish Office, the local council and Scottish Borders Enterprise, but was also drawing on the experience and expertise of other local bodies.

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