The Look East Debate Our Economy

Hello. Well, who would have thought it? Four years after our economy

was plunged into crisis we are still here, desperate to avoid

another recession. We have got huge debts and mass unemployment. The

question is this, how will we get ourselves out of this mess and back

on the road to prosperity? APPLAUSE. Good evening took Silicon Fen in

Cambridge. This is the headquarters of a company called ARM. They

design the important bits then you're electrical products like

mobile phones, telephones, washing machines and cars. It is very

successful and the company is now worth over �7.5 billion,

considerably more than Marks & Spencers. The hi-tech companies

clustered around here are among the best in the world. We want to find

out how this ruin can drive the economy back into growth. We have

business leaders, entrepreneur's, investors and politicians. Before

we hear from them, let's get things started with some research which

has been specially commissioned for this programme. Times are tough but

according to this research our region is doing better than most.

Our unemployment rate is below the national average. We have got a

good the range of growth companies and industries. We have Silicon Fen,

a cluster of technology companies. Hour I t and life sciences

companies have been very resilient during the downturn. We have

motorsport engineers, pharmaceutical companies, we do

more than our share of research and development in this region. We have

an emerging renewables industry. We are particularly good at

encouraging start-up companies. Harlow in Essex has seen the

biggest upturn in company numbers. We have reasons to be cheerful.

were talking about new businesses. We have a terrific example of one

here. This family started a shellfish business on a river in

Suffolk. Let's look at their story. We are very proud of seeing our own

oysters on sale. When we are farming we never usually seek any

produce apart from beef on sale but the oysters we see everywhere. We

are planning to reintroduce native oysters into this river because

they were wiped out by a bug. The thing about school is that it is

all academic now. I am dyslexic and I cannot do that very well. If you

cannot be employed by anyone else you can always start your own

business. You just have to get out there and be you're born boss, try

it out, what is the worst that can happen? -- Be Your Own boss. There

is no denying that your son has the right kind of get out of the Earth

attitude but is that enough in this climate? It does not change the

fact that we have to supply shops and restaurants what they want,

when they want it and for the money than they can pay. If we do not do

that all the time all the enthusiasm in the world will not

keep your business thriving. I am sure everyone here wishes you the

best of luck. Harlow is doing very well for the number of start-up

businesses. You are leader of the council, why is it, what are you

doing right? Two things. The great location we have with the airport

just up the road and the motorway network. The council have also

taken a pro-business approach. We have a regeneration team who deal

with businesses on a one-to-one basis. Businesses do not get the

run around and shunted from department to department.

crucial are the banks in all of this? A lot of these small

businesses tell us that the banks are not lending to them which is

why the council uses its Government funding to make business life

easier. We have a building with very easy terms and shared

facilities that make it easy for start-up businesses to get it going

with minimum finance. We hear it all the time that it is tough for

small businesses because banks are not lending to them. As a banker,

we desperately want to lend to businesses. The only way that best

regional economy will be successful is by us all watching businesses

grow. Why are we not getting the money go? A lot of the small

businesses are not coming to the banks and asking for support

because there is a fear that we will see no. People with business

plans must approach the banks as fairly as possible with their ideas.

OK, that is good news, you are seeing if you do not cast you do

not get. Graham Bright you are the spokesperson for the Conservative

Party, why have the Government not meet the banks give loans? We do

have a guarantee scheme where the banks must lend to small businesses.

The Government is very committed to small businesses. I was chairman of

the Small Business Committee. are hearing that you are committed

to it, Simon Wright, a Lib-Dem MP, we hear all the time that Vince

Cable, he wants to help small businesses but it seems that the

money is not getting through? project merlin was introduced we

saw a 13 % increase in lending. What is that? It is a requirement

put on banks to lend more money to small businesses. They are largely

meeting their targets but nonetheless I hear similar stories

from small businesses that they are not getting access to the finance

they need. Later this week we will read about credit easing from the

Government. What would Labour be doing differently? We would not

just see it, we would do it. -- not just say it. Lending has gone down

by �10 billion. I agree that many countries around this region do a

brilliant job and we are supporting them but one thing is for sure that

this Government is not the one doing it. Are you getting the

support and funding that you need to grow? We are not. It is a

familiar story. The Government last year did put a lot more money into

this region, �70 million in infrastructure for life sciences

and health care but when you look at other markets like France,

Germany, Singapore, we are talking billions there. If we are going to

be globally competitive we need funding. Do you feel the east is

overlooked? I do. It is interesting that this region was singled out as

not receiving some funding. Let me put that 0.2 Graham Bright, you are

not investing in success here? are investing in infrastructure

which is important. Money is going end to the railway and the local

roads. The Thames linked links Luton and King's Lynn down to the

south. There are new docks being built on the Thames side. The new

Crossrail. Everything is the it to actually keep business and allow

business to move about. Hamel is sitting in the right place, we want

to put everyone in the right place. We will talk more about

infrastructure but let me bring you end, you are what people call at

business angel. You step in where the banks and potentially

Government fear to tread, what is the key to growth in this region?

The essay is an area where we have a large amount of research and

development. When the bank's top about small businesses, early-stage

companies do not even qualify. I am talking about companies that are p

Revenue, they have not got their project, they are doing research

and development in biotech and other forms of technology. Those

companies are our future and we have to do something

internationally to get them equivalent to similar companies in

other countries. I want to introduce warrant East, one of our

guests and a Heath executive here at ARM. -- Warren East. What

briefly do you think has been the key to success and the reason for

growth? We have been at it for 21 years. We started in a barn at 21

years ago. We have firstly some excellent technology. The way we go

about our business is collaborating with potential competitors, using

our technology to help service their companies and then we take a

small share in their profits. That has allowed us to move around,

target the growth markets and we have a culture that has helped us

go along. Some might say that ARM has succeeded against the odds.

What are the challenges facing us in this region? There is no doubt

that this region has potential economically but will it realise

that? We pay more tax each year to the Treasury than we get back. In a

sense, we get poor value for money from Government. This is reflected

in our infrastructure. Our roads leave a lot to be desired, Our

Railways, our broadband connections. Hour access to Government funding

is not always easy. The Regional Growth Fund is biased towards

poorer regions. We have to ask if we will fulfil our full potential

if our roads are always congested, our computers don't work

wonderfully well and also if we do not have equal access to Government

Another guest is Andrew Olley, you run a shop in Ely and you have one

major gripe. One of the challenges facing us is the demice of town

centres. -- demise. And my belief it is because local authorities

don't put enough focus on that town centre and they're more encouraged

to take money from out of town development of supermarkets.

have been to Ely and let's hear more about your situation. I run

City Cycle centre in Ely. We have been here for 40 years. Over 40

years how. As an independent trader. Along with a will the of other

trades within this city centre. But all of us are under threat as never

before. If a town centre has parking charges in it, and you have

huge car parks of 500 free spaces in a Sainsbury and 1,000 in a

Tescos that is planned, people go out of town. Huge amounts of money

are given to local authorities each time they allow out of town

developments. People will vote with their wheels and we'll lose our

town centre,. Well the Government has brought in the TV presenter and

expert marry - Mary Portas. How will the Government do this. Well

it is not the Government. It is local authorities. We're looking at

the moment at changes in terms of planning regulations and that is a

big debate. I take the point very much about out of town shopping,

compared with the city centre. I like going in the city centre and

enjoy that shopping. Really, this is down to local authorities being

sensible about it. Getting the balance right. And one of the big

issues is parking. As we have been told and we have got to address

that in our towns. Isn't one of the problems that we like to say yes we

love our town centre, but we still shop in the out of town

supermarkets and do shopping on the internet. It is difficult to match

the two. No, I love our market towns. I'm sure you shop in a

supermarket now and then. But it is not up to local authorities to be

balanced if the is ripping up the planning laws. I would like to

endorse what Richard said, you know, we're in a business audience, there

are many strengths in the region, but our businesses are suffering

too, whether it is the regional development agency that was

abolished, the local enterprise departments, the regional growth

fund, the Alice Bhandhukravi - ebroadband support. The Government

is -- the broadband support. Our business needs help too. You don't

get far without hereing the words A14. Paul Davey, it is one o' your

main bug bears. We're the largest container port in the UK, moving

40% of the UK's imports and exports through region and the A14 is our

major route to markets for our business and others. And there

should be a priority for Government to commit some investment into

improving the bottleneck opt A14. Toll roads, the A14, A11. What do

you think? There are no firm proposals, David Cameron's asked

the Department for Transport to go to look at this and come back in

the autumn. In the meantime we're getting the A14 improvement and

gets the A11 dualed. We are getting a lot of thing that Iical pained

for which Labour failed, your party, you have been critical of the

coalition, perhaps urging us to go faster. But we are delivering on

projects that are important. You're a managing director of Stansted

Airport and we heard the coalition say they're doing what they can.

What is your main challenge? For us it is about Serbty -- certainty.

Infrastructure is a long-term game and we need to know where the

Government is going. We heard the speech from the Prime Minister

about infrastructure. But the fact that it is being talked about is

important for us. Bee, you run a haulage firm and apart from fuel

prices what do you find is one of your main challenges running a

business? One of challenges we have is the planning law, which various

businesses have touched upon, until we untravel that red tape

associated with planning, it is hard to see how we will move

forward quickly. It has become a slow process. Who else is finding

it a problem with red tape here? Businesses and red tape is

something we hear a lot about. Why aren't you make it easier for

businesses? I also run a medium sized business in the east. And yes,

there is red tape. Yes we have got to address some of it. A lot of it

is European, but we make it worse. And it is difficult to operate a

business, if you're a medium sized company, you need so many resources

to look through the red tape, to see how you deal with it. To

actually organise yourself around it. Burr that stops the sort of

growth that we want. Pee Kerr Kendal, president of the -- Peter

Ken Tall, president of the farmers union. Is Rep tape a problem?

farmers want to get out of their office and produce food. We produce

more food than any other region. Farmers are tearing their hair out,

because they can't get planning permission to build reservoirs. You

can't write off reservoirs, the last Government changed taxation

for that investment. Farmers spend too much time tick boxes and

filling forms. Next to you, Alex Paul representing the tourism

industry in the east. We have heard mentions in the conversation about

broadband. Is that something that is proving challenging for you?

the internet is a vital tool for tourism. And the internet for the

businesses in the region is a business tool, a route to market.

And with so many of the businesses in this region being small and

medium, they need a strong, stable broadband to do their business. And

they will lose business to other regions if customers can't reach

them. So it is vital. Ann Glover, we have been talking here about the

private sector. You represent the public sector. You're from Unison.

Challenging times for you? Yes. We have lost thousands of jobs in the

public sector and while we are fortunate to have areas like

Cambridge where you have businesses that are doing well you have got

areas of social deprivation, who rely on the public sector for

employment and you know nothing exists in isolation. If people

haven't got money, they can't spend on the highs and that affects a lot

of small businesses. It's you know, job creation is important. There

needs to be more investment in the public sector. And I don't think we

will get it. But people need to earn a decent wage to have an

income they can spend and that will help to isle the -- oil the wheels

of the a the local economies. co-founded Acorn computers in 1979,

got a huge amount of success and experience behind you. If you were

starting out now, co--- do you think it would be harder or easier?

Much easier. Why? At the time we started there was no venture

capital, there was no knowledge on how to do high technology firm. And

now we have a lot of the infrastructure that we lacked at

the time is in place. So I think now is a better time to start a

high technology company. That sense of optimism is probably not shared

by the 208,000 people who are unemployed. If we look at any

recession, one of the first casualties is jobs. People get

thrown out of work. Many are young people. Between the ages of 16 to

24. So what is being done to save the region's workers from the dole.

Over to our political present. An drue. One of the region's MPs was

saying that the lack of a properly stilled -- skilled workforce is the

biggest problem facing the country. 40% of people in Britain have only

been educated to a pacic skills level. That is a poor set of GCSEs

and that is much higher than many parts of Europe and America and

businesses are finding it hard to recruit staff with the rate skill

and often have to recruit people from overseas. So the Government

has been spending time and money in encouraging apprenticeships. But

some people the problem goes further than that. In Japan every

student studies maths until 18N Korea the figure is 90%. Here just

0% of people study maths until 18. The Government's reviewing the

National Curriculum, but MPs say unless maths and science gets

greater prominence, we will never bridge that skills gap. Thank you.

A lot to talk about there. Let's start by introducing someone who

has experience of being an pri - eapprentice. Zakar Hussain is work

at a construction firm. This is his story. I'm production management

trainee. I started back in 2010. I did go to college, but college

didn't work and I went for an apprenticeship. At school the

problem was that we never got drilled to get apprenticeships, it

was get exams to get into college to do a course. But a lot of us

didn't have a clue what an apprentice ship was. I get funded

to do my degree and I'm progressing and I have a good site time and

then become a project manager. I'm learning what I'm learning and it

is fantastic. Zakar, you feel like you're getting a first class

experience? Yes, first hand experience. I started with an

apprentice and got the foundation grounding and my question would be

to the local MPs, what are they doing for young people. A lot of

people that leave university go to do a degree and get, because they

expect to know when they leave when they don't know. So Richard, what

would Labour do for young people. We did bring back apprenticeships

and good for you and the others that are putting in as much as you

can. Look at the problem with work fair, where the government said

young people should work for nothing. And we had Tescos saying

work on a night shift for nothing. And these companies, even Pound

land walked away from it. That is not a serious support for people,

16,000 in the east east didn't have a job, didn't have training and

weren't in education. You say they are only picking out the bad

expierce. You are talk about the young people, we have had ten

people and given them three full- time jobs. The once we haven't

given jobs have gone away with better CVs. I back companies like

yous, but we would give a national insurance holiday to companies to

give you a reward for bringing them in. That is something the

Government took away. The scheme we have had has been positive. You're

only looking on the negative side. Nick barton from from Stansted

Airport, one of biggest employer in the region. How you finding its

have you got the people. Have you had to make people redundant.

yet. We have had four years of decline the airport is a barometer

for how we feel in terms of air travel is discretionary and when we

feel nerve us about the future, you're inclination to travel is

reduced. Businesses are struggling to justify the expense and we see

that in passengers. The issue for us is protectsing the business we

have and protecting the jobs. There are around 10,000 jobs. How many

are filled by local people? they are. But that has changed we

use Tods struggle to recruit into the airport and we advertised 108

seasonal jobs in the summer. We would struggle to fill the jobs,

last summer we had over 2,000 applicants. So there was no

difficulty filling them. The issue Harriet Fear, biotech industry,

life sciences, is there a skills gap there? Yes there is. Some of

the bigger companies say they are finding real skills gaps at the

high end and are having to look at recruiting from overseas. Then you

get into the whole conundrum of the red tape issued over immigration.

One of the key issues is the fact that students are not taking

science at degree-level whereas many should be. That then stems the

pipeline of individuals coming through with the expertise.

Professor Lloyd reason, you are in the education sector, you teach at

Anglia Ruskin University. You teach entrepreneurial skills, we are

hearing that people are not doing the right degrees and coming

through with the right skills. is crucial that universities do

their part. -- Lester Lloyd-Reason. It is our young, small, high-growth

entrepreneurial businesses that are going to be growing as out of the

economic imbalance. We have got to create the circumstances, provide

the skills for these young entrepreneurial people and their

businesses to achieve their aspirations. Simon Wright, it not

enough being done at the moment to boost our young entrepreneurs?

think we need to do more to encourage young people to continue

with maths. As a former maths teacher myself I find this at a

real shame. By a sign says such as those in Norwich the Teal Park have

an ambition to expand their employees by 5,000 over the next 10

to 15 years. We need to make sure these skills are in place so that

young people can take advantage of the opportunities available.

how have you found it getting the right people in the right jobs?

Easy? The No, it is difficult. Even for this region which has high

educational standards, we still do not have enough influence at school

or university level to educate people in maths, sciences,

technology and Engineering. Are you able to recruit locally? We are.

But we need to recruit a fairly specialist skilled workforce and

about 40% of our employees are here in Cambridge. When we add a few

hundred people worldwide we are adding a significant proportion

here. We are very lucky. We are able to find people. But similar

companies in the region to whom we talk, doing the same sort of thing

and without the brand, they find it much harder. Peter Kendall,

agriculture is an interesting one because a lot of migrant workers

are in the sector? A lot of young people are coming back into farming.

There has been a real shift over the last five or 10 years when

people realise that creating food is going to be important. There

have been some great success stories with farms growing

businesses in this region but we cannot do that without having

migrant workers available. It is as sad tale but we have to have that

otherwise be would not be harvesting the crops we need to

feed deep population. Is that because people locally do not want

to do the jobs? I think we in the farming industry have to

communicate that these jobs are not all low-skilled. A lot of the

farming businesses in the region do depend on that migrant work force

will. What is the one thing that needs to be done to ensure that

your students do succeed in the world? At our university we are

passionate about providing our students with the employability

skills to take control of their own couriers. It is a very different

world from when I left university, then it was about getting a job and

a courier, now it is about giving them enterprising skills and

entrepreneurial skills. They do things that are things they enjoy.

It is very important to give them team leadership skills and a lot of

our management students are here this evening. They are indeed, I am

going to be asking for their take on things later. Before that, what

we are going to do is talk about the Budget. As always, there is

lots of speculation about what might go in it. Are you keeping

your fingers crossed for Wednesday? We are hoping for a few freeze on

the duty. It would be fantastic to think there is a reduction but that

might be too optimistic. It does not just affect industries such as

ours, the logistics industry, everything we buy in the UK at some

point is delivered on a van or truck. It is affecting businesses

in all sectors. It is biting into the pocket of everybody. What has

George Osborne got up his sleeve? One thing I want to make sure he

does his stick to what he said about corporation tax. We are

heading in this country to be the lowest Corporate taxed country in

the whole of the G7. That attracts not only British people to invest

but foreign people to invest as well. That is terribly important. I

also am concerned about fuel. I would like to remind everyone that

if we had stayed with the regime we had we would be paying more and now

per litre. I think he has got something up his sleeve. We will

wait and see what happens on Wednesday but the budget is not

going to be a giveaway Budget, it is going to be tough, but if Labour

were in power you would not have the ability to pick together a

giveaway Budget I there? If our proposals for attacks macro cut

came in that would lower energy costs. If you are going fast in the

wrong direction you should change direction, not change speed. Let me

bring Simon Wright end. A lot of haggling in the coalition about who

would get their way, what about you? I think the economy needs to

see more pounds in people's pockets. The UK is one of the top 10 world

destinations. We need to put money in people's pockets to help the

retail sector. Do you support the income-tax hike? I want to ensure

that after this but in the wealthy are paying their fair share and

that those on low pay are taken out of the tax system as much as

possible. I would like to see what some of you around the room are

hoping for or think should be in Wednesday's budget. I personally

hope there will be a focus on local authorities being given more

control over their, more focus on their town centres. More control

for local authorities? What is your wish list for the Budget? One wish,

please. I would hope for the parliament to think longer term. We

do not have wealth-creation if we are always fiddling with the next

few years and not looking at the international competitiveness of

our economy. And what would you like to see? I would like to carry

on with the emphasis on schools. This is the way forward. Growth

will come from lower down and anything that will help will be

fantastic. I would like to see investment in jobs so that we have

people earning a decent wage. would like to get a bit of a sense

from our economy students here tonight. Not just economy students

but business leaders perhaps entrepreneur's and business leaders

of the future. If you are feeling less optimistic about the future

can you put your hands up? And if you are feeling more a? That is

what we wanted. And I can hear an audible sigh of relief all around

because let's face it, if those guys are not optimistic, we are

really going to be in trouble. We have heard a lot of use tonight

from a lot of different people. You have experience and a good deal of

success behind you. Seated either side of you are two young people

about to make their way in the world of work, what would you

advise be to them? My advice is go for it. What we do not have enough

of his this entrepreneurial spirit of people starting their own

businesses and creating employment. Ironically, during periods of

economic hardship which we are going through at the moment, some

very good people are being made redundant. Fortunately, they do not