BIS Sheffield/Government Departments outside London: 9th May 2016

Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)
I congratulate the hon. Member for Sheffield Central (Paul Blomfield) not only on leading the charge in the debate, but on his quite excellent forensic analysis of why this is a deeply flawed policy decision.

The dispersal of Government offices has been argued for for many years—from as far back as the early 1960s. Although this is not a new debate, therefore, it may be wise to rehearse some of the reasons why dispersal can be forcefully argued for. I would like to focus in my short speech on just three.

First, on cost, it will be considerably more cost-effective to locate Departments in Sheffield or Kirkcaldy than in overheated London. A number of hon. Members have pointed to the fact that they cannot find, or cannot get released, any detailed cost-benefit analysis. Perhaps that is not surprising if no proper cost-benefit analysis has been undertaken in the first place.​

Secondly, this is about not just the cost of dispersal but the benefits to the recipient regions. In particular, if dispersal happens in areas that have relatively weak economies compared with London, the benefit of even a few hundred well-paid and secure jobs can be considerable. Many towns in the north of England would benefit greatly if there was more dispersal out of London.

The third point I want to raise, which is much less talked about generally, although a number of hon. Members have raised it today, is the benefit to Government intelligence and decision making. It is unhealthy for all key decision makers and advisers to be based in one location, particularly if that location is out of character with the rest of the country. Dispersal provides an opportunity for better engagement. When we presented the case for this debate at the Backbench Business Committee, I argued that one of the problems is that this decision seems to reek of group-think by the Government. To put it in a slightly more academic fashion, it reminded me of reading for the first time the work of Kenneth Hammond on his cognitive continuum theory, with which I know everybody is deeply familiar. He argued that decision making can be on a continuum from highly intuitive, at one extreme, to highly analytic, at the other extreme, with a mix in between. It strikes me that the reason why a lot of evidence cannot be provided for this decision is that it reeks more of intuition than of detailed analysis of the true benefit.

In the Backbench Business Committee, I was asked why a Scottish MP would want to speak in this debate. Perhaps, without wishing to be accused of any arrogance, there might be one or two examples that could be brought from Scotland to show the benefit of dispersal.

The Minister for Small Business, Industry and Enterprise (Anna Soubry)
Give us some.

The Minister for Small Business, Industry and Enterprise (Anna Soubry)
I begin by congratulating the hon. Member for Sheffield Central (Paul Blomfield) on securing this debate through the Backbench Business Committee. It has been a very good debate. A number of hon. Members from both sides of the House have raised a number of very good points. I know that the clock is against me—that is the rule of Parliament. The last time I said that people seemed to think it was my choice. It certainly was not. I will of course write with an answer to all those hon. Members whose questions I do not answer in my response. That may include the hon. Gentleman, in this respect: his questions were quite long, and I do not have time to answer them all at length. I will deal with the points he made, but in the time allowed to me I will not be able to answer them all in the sort of length that I would like.

It is very important that we have as the focus of this debate the 247 people who currently work in the Sheffield office. I make the point that, yes, we have put forward the proposal, but a final decision has not been made. It has been out for consultation, and I very much hope that a number of hon. Members took part in that ​consultation. A final decision will not be made until 23 May. Everyone on both sides of this House will know that Governments of whatever colour have at times to make very difficult decisions, but we have to be sure that we make the right decisions for the right reasons.

I also make this point, which is very important. Whatever the decision on Sheffield, 83% of the people who work for BIS will continue to work outside London. To some extent, I take a little exception to the suggestion that we in BIS are not in touch with what is going on in the rest of the country outside London. The Secretary of State and I do not represent London seats; as hon. Members might imagine, we return to our constituencies. Most importantly, we still have an exceptionally fine team of local BIS civil servants working throughout the whole country, who feed in—indeed, I have at least a monthly meeting with them—when they give me a round-up of everything that has happened across the country.

By way of example, the Green Investment Bank is proudly based in Edinburgh. UK Trade & Investment exists throughout the whole country. Today, I have been on a visit in Leicestershire, where I opened the marvellous new extension of an excellent business. Not only did I then meet the Leicester Asian Business Association, but, as I often do, I met the local enterprise partnership. I say to the hon. Member for Sheffield South East (Mr Betts) that when I come to Sheffield on 23 May, it will be a pleasure to meet him and have him there at my visit to those steel mills. I will also meet the LEP, because getting that feedback is so essential.

I turn now to the reasons behind the proposal. It is really important to set this in the right context. That context is a mixture, of course, of the financial position that we are in and the decisions that we have rightly made to make sure that we have a budget that we can cope with and that BIS plays its part in reducing overall spend. But it is not just about cutting money. It is about making sure that this Department works as efficiently and effectively as possible. The situation that the Secretary of State and I inherited was the frankly historical problem of an abundance of sites. A decision has been taken, against that financial background—I hope that this answers the questions of the right hon. Members for Rother Valley (Kevin Barron) and for Sheffield, Hallam (Mr Clegg)—

Kevin Barron
It is cost cutting.

Anna Soubry
It is not as simple as cutting costs. The right hon. Gentleman, with his great experience in and out of government, should know that. It is a question of making sure that we have an efficient and effective way of working in BIS, set against the financial restraints that we have quite properly put upon our Department as part of our overall requirements with regard to the deficit.

Our current HQ office locations are based on the legacy I mentioned, and have resulted in a complicated map of management relationships, with work in policy teams spread across 14 different locations. We are committed to reducing our headcount by 2020. That will involve becoming more flexible and redeploying fewer staff quickly to new priorities. We need simple structures that allow staff to interact through quicker, less cumbersome means and stay close to each other in flexible teams. We ​rightly put a strong emphasis on staff engagement, excellent management, visible leadership and developing and coaching our staff. Those are harder to achieve if teams are not collected together or are not working under the same roof. We believe that having a single-site BIS policy headquarters is the best way to preserve our effectiveness. Given that our teams serve Ministers in Parliament, those headquarters have to be in London.

I want to make this point absolutely clear. Whatever the decision, we will continue to provide good and full support to the 247 members of staff who have had this proposal hanging over them—we are very conscious of that—since 28 January. If the decision is made to close the Sheffield office, that support will continue, because this Department takes its duty of care to each and every one of our staff extremely seriously, as I hope hon. Members would imagine.

I have said that tough decisions have to be made. The hon. Member for Kirkcaldy and Cowdenbeath (Roger Mullin) and his colleagues on the Scottish National party Benches will understand that, for Governments of all colours, there are times, set against a difficult financial background, when tough decisions have to be taken. I make no criticism of the SNP’s decision back in 2013 to close 10 sheriff courts and seven justice of the peace courts, with operations transferred to other locations. Those are the difficult decisions that have to be made. Of course, the SNP closures were justified as cost-saving measures, but, to be fair, as part of a wider reform of the justice system as well. We can all take away from that the fact that the SNP was not just cutting things for the sake of savings, but was doing so as part of a broader strategy.

Callum McCaig (Aberdeen South) (SNP)
rose—

Anna Soubry
Unfortunately, the clock is against me, and the hon. Gentleman has only just walked into this debate, so I am even less disposed to take his intervention.

Those are the difficult decisions that Governments have to make if they are to fulfil their duty, which is not only to make sure that we live within our means but to ensure that we act efficiently and effectively.

I will deal with the four questions that the hon. Member for Sheffield Central asked me—I am grateful for the email and attachment that he sent to my Department. Some of what he raised has already been dealt with by the permanent secretary in his evidence to the various Committees. I will take just the sharp end of the hon. Gentleman’s questions. He asked what assessment had been made of the cost of replacing jobs and moving them to London. A full assessment has not yet been made, but, as he will know from the evidence of the permanent secretary, the total over time for the Sheffield office was thought to be some £14 million. As I have said, however, this is not just about costs. As for the assessment of the cost of replacing Sheffield jobs in London, the final decision has not been taken, and until it has been and we know all its ramifications it will not be possible to give that assessment.

The hon. Gentleman and other hon. Members asked about the northern powerhouse, but I do not need to be told what a great and wonderful city Sheffield is. You do not need to know, Madam Deputy Speaker, about my ​connections with Sheffield, or the fact that my family comes from there—[Interruption.] Exactly. Because I am from north Nottinghamshire, I spent a great deal of my youth in Sheffield. It was an outstanding city then, just as it is now and will no doubt be in future. In our devolution deal, we have put Sheffield at the heart of south Yorkshire, and we have delivered millions of pounds to Sheffield—[Interruption.] Which part of the Sheffield city deal do Labour Members not understand? The clue is in the name: Sheffield is at the heart of that deal, with all the attendant money and power that comes from it. That is to be welcomed, and I am surprised that Labour Members are not talking up that excellent deal, the outstanding city that is Sheffield, and the northern powerhouse. I hope that they will make the case for HS2 to have a proper station in Sheffield. I have a bias because I want an east midlands hub in Toton, as I am sure there will be, but we must now ensure that Sheffield plays its part in HS2.

David Mowat
Will the Minister give way?

Anna Soubry
I do not wish to be rude to my hon. Friend, but the clock is against me and Madam Deputy Speaker is urging me to conclude my remarks.

The final question from the hon. Member for Sheffield Central concerned what other options there are apart from the proposal. Full consultation has taken place with unions and staff, and several alternative proposals have been received. The BIS executive board will take full account of those when reaching its decision on the proposal, and I hope that goes some way to answering his question.

In conclusion, I wish to pay a full and handsome tribute to all staff in BIS. We take their future, work conditions, and the contribution they have made very seriously, but sometimes tough decisions have to be made. This is not just about saving money; it is also about ensuring that the Department works effectively and efficiently, and that is what we seek to achieve.