:01:06. > :01:10.In the Midlands: The warning lights are flashing Fry two speed economy.
:01:10. > :01:15.Some firms to cut red while others get the green light and forge ahead.
:01:15. > :01:25.And as Jaguar Land Rover make a billion, we are on the inside track
:01:25. > :01:25.
:01:25. > :31:34.Apology for the loss of subtitles for 1809 seconds
:31:34. > :31:38.with the man who helped turn them Hello from the Midlands. After all
:31:38. > :31:45.week when Cadbury's owners Kraft told us they were cutting 200 jobs,
:31:45. > :31:49.but JCB announced the creation of 350, confusing, isn't it? We have
:31:49. > :31:54.foreign economic forecast from the lake up -- Labour peer who brokered
:31:54. > :31:59.the Indian takeover of Jaguar Land Rover. Joining JLR in the fast lane
:31:59. > :32:04.are Amazon, Marstons Brewery and Monarch Airlines, all creating jobs
:32:04. > :32:09.and hoping to deliver Growth. We expect unemployment figures to be
:32:09. > :32:12.up again next week, leaving more of us stuck in the crawler lane. No
:32:12. > :32:17.wonder there's so much talk these days about our two-speed economy.
:32:17. > :32:23.What is to be done is a question today. Jeremy Wright, the
:32:23. > :32:28.Conservative MP is with us, and Geoffrey Robinson, the Labour MP
:32:28. > :32:31.who served as a Treasury minister in Tony Blair's first
:32:31. > :32:36.administration, a Coventry and Warwickshire presence here. First,
:32:36. > :32:44.Giles Latcham reports on three contrasting reports of the Midlands
:32:44. > :32:49.economy at work. -- three contrasting accounts.
:32:49. > :32:58.Slow, slower, stationary, reach for handbrake and stop, you have ground
:32:58. > :33:02.to a halt. Haven't we? Or have we? They may not be in the fast lane
:33:02. > :33:12.but in certain sectors of the Midlands economy, certain companies
:33:12. > :33:17.
:33:17. > :33:21.We have the loading on the side there. Gazeley, for example, that
:33:21. > :33:26.logistics firm which brought Amazon to Rugeley along with 900 jobs,
:33:26. > :33:32.have yet to sell this site north of Stoke-on-Trent but are facing 2012
:33:32. > :33:39.with optimism. This year, we started with six buildings, and we
:33:39. > :33:44.are left with one, but we also have sites in Stoke where we have
:33:44. > :33:48.interest from manufactures and warehouse customers looking for
:33:48. > :33:53.development sites. That takes a lot of investment in our company and
:33:53. > :33:58.confidence. And Gazeley are not alone. 2000 jobs in prospect in
:33:58. > :34:03.Wolverhampton at Jaguar Land Rover's new engine plant, 1000 jobs
:34:03. > :34:08.at Black country brewers Marstons, 200 jobs at the John Lewis store in
:34:08. > :34:12.Tamworth. But for every green light company, there are many more,
:34:12. > :34:18.usually smaller, enterprises, consolidating, just trying to
:34:18. > :34:22.survive, stuck on amber. At a tool maker and injection
:34:22. > :34:28.moulding firm in Cannock, there is not much in the way of growth. What
:34:28. > :34:32.has the forecast? The boss, a former investment banker with a
:34:32. > :34:36.passion for manufacturing, is relentlessly positive, and has just
:34:36. > :34:39.spent a quarter of a million pounds on new machinery. If I run my
:34:39. > :34:44.business listening to the media, I would probably have slit my wrists
:34:45. > :34:49.by now. It doesn't seem like that at all. It is a complete disconnect
:34:49. > :34:55.as far as I am concerned between what we see for 2012 and the news.
:34:55. > :35:02.The gloom and doom about their is all-pervasive, but for us, we see a
:35:02. > :35:05.better 2012. They still employ 25 people here and four rival firms
:35:05. > :35:15.have gone under. By one estimate, since May last year across the
:35:15. > :35:20.region we have lost 39,600 jobs, in the public and private sectors.
:35:20. > :35:23.The latest forecast suggests unemployment levels been --
:35:23. > :35:28.employment levels will languish behind the rest of the country up
:35:28. > :35:31.to 2020. Less than encouraging for volunteers at this furniture
:35:31. > :35:36.recycling scheme, some who have been job hunting for months, others
:35:36. > :35:40.for years. Since I have been volunteering I have had the
:35:41. > :35:45.confidence to be able to apply for jobs. It is not that hard now for
:35:45. > :35:49.me to be able to have the courage to just go there and apply for them
:35:49. > :35:53.and just send them off, even if most of the time I don't get a
:35:53. > :35:57.reply. The larger companies seem to be, as I say, providing more and
:35:57. > :36:04.more jobs, so fingers crossed things will get better. We still
:36:04. > :36:12.have to have times ahead, I think. Smaller companies will struggle. It
:36:12. > :36:16.is a case of hanging on in there to my mind, to find something.
:36:16. > :36:22.If it is a waiting game we are playing, it is longer for some than
:36:22. > :36:26.others. Patience, please. Yes, Granta's patience but be quick
:36:26. > :36:30.about it. Giles Latcham reporting. Jeremy Wright, your government has
:36:30. > :36:34.pledged to rebalance the economy. They are thinking about the gap
:36:34. > :36:38.between north and south, but it seems the lesson of that report is
:36:38. > :36:42.that we have those imbalances right here and around noses in the
:36:43. > :36:46.Midlands. We do and we don't just talk about rebalancing north and
:36:46. > :36:50.south but manufacturing, financial services, service industries, they
:36:50. > :36:53.all need to be balanced to ensure we have a safe -- successful and
:36:53. > :36:58.balanced economy. To help manufacturing we can ensure tax
:36:58. > :37:03.rates are low for manufacturing companies, bring Corporation -- we
:37:03. > :37:05.are bringing down corporation tax this year, we can look at research
:37:05. > :37:10.and development and ensure the right tax credits available for
:37:10. > :37:14.that, and there is good news for that in the or -- Autumn Statement,
:37:14. > :37:19.and we can help provide a well- educated, well-trained, highly
:37:19. > :37:24.skilled work force. Is that enough? If you look at your area, Coventry
:37:24. > :37:28.and Warwickshire, Coventry has been hit by a private sector and public
:37:28. > :37:33.sector job losses during your time in government, the Bonfire of
:37:33. > :37:36.educational quangos, private sector companies before that, then science
:37:36. > :37:40.parks on the periphery creating successful new businesses. A world
:37:40. > :37:44.of extremes. That is true and rebalancing is also about
:37:44. > :37:48.rebalancing between the public and private sectors, and the truth is
:37:48. > :37:52.that we have to see, and are already seeing, are large and of
:37:52. > :37:56.private sector jobs created, half a million nationwide since this
:37:56. > :37:59.government came into office, but this is a painful process. I'm not
:37:59. > :38:04.pretending that over the period of rebalancing there would be
:38:04. > :38:08.difficulties but we are heading in the right direction. Jeremy, do you
:38:08. > :38:12.think that is such -- sufficient to deal with the difficulties? It is
:38:12. > :38:16.just not working. If it was working we could accept it, buckle down and
:38:16. > :38:22.go ahead but the truth is that unemployment is rising, the economy
:38:22. > :38:28.is stagnating and one objective of government policy is not being
:38:28. > :38:31.achieved, the deficit reduction. They are missing the target by �168
:38:31. > :38:35.million and unless we get out of this mindset of cutting and
:38:35. > :38:45.increasing unemployment, shutting down factories, although we have
:38:45. > :38:45.
:38:45. > :38:49.had wonderful successes, as Kamal Bhattacharya it shows, where we had
:38:49. > :38:53.those successes, they don't reflect the economy as a whole. Industry
:38:53. > :38:59.does best when the economy is rising and until we get back their
:38:59. > :39:03.and get employment rising again, I think we will stagnate. Does it not
:39:03. > :39:07.reinforce the point that the IPPR, the research group, says that
:39:07. > :39:13.unemployment in this region will remain higher-than-average until
:39:13. > :39:17.2020. It will take that long to recover from the downturn of 2008.
:39:17. > :39:21.Unemployment is variable across the region. In my constituency the
:39:21. > :39:25.claimant count for jobseeker's allowance is lower now than a year
:39:25. > :39:28.ago. There are huge variations and I think I am right in saying that
:39:28. > :39:32.the West Midlands is actually the region were the greatest variation
:39:32. > :39:35.of the whole country. But to return to something Geoffrey says, he is
:39:35. > :39:39.right that the general state of the economy is important, and we have
:39:39. > :39:43.to ensure there is confidence out there, but confidence comes partly
:39:43. > :39:48.at least, from an idea that the government has got to grips with
:39:48. > :39:52.the main problems we face, one of which is a deficit which is far too
:39:52. > :39:58.large, debts which are far too big. The way you resolve that is most
:39:58. > :40:02.certainly not to do what Geoffrey's party did. I think the most
:40:02. > :40:04.important thing the government could do right now would be
:40:04. > :40:09.crudities in. Unfortunately everything they have tried to
:40:09. > :40:13.arrange with the banks so far has failed there. We have talked about
:40:13. > :40:16.reconstructing manufacturing, and what could happen now, and making
:40:16. > :40:20.credit available and getting it into all sectors of the economy,
:40:20. > :40:24.but particularly the productive sectors, is something they could do.
:40:24. > :40:32.They have to get on with it and did better than so far. Money should be
:40:32. > :40:37.made available, for companies to use it. 18-24 year-olds, one in
:40:37. > :40:41.five unemployed, what would you do about that, Geoffrey Robinson?
:40:41. > :40:46.would get the economy moving as a whole. Geoffrey mentions credit
:40:46. > :40:50.easing. We are making �20 billion available for small and minute --
:40:50. > :40:54.medium-sized businesses. The crucial question about 18-24 year
:40:54. > :40:58.olds is more apprenticeships and better training. There will be new
:40:59. > :41:02.apprenticeships at Level 4, equivalent of the first year of
:41:03. > :41:12.university. Our traffic lights are moving to amber so we must pause
:41:13. > :41:14.
:41:14. > :41:18.Few people can be better-qualified to the home truths about the state
:41:18. > :41:24.of the economy in our part of the country than Lord Kumar
:41:24. > :41:27.Bhattacharya, born in what is now Bangladesh. He has had the ear of
:41:27. > :41:31.successive prime ministers since Margaret Thatcher. Things took off
:41:31. > :41:36.for him when he came to Birmingham in his twenties. He became an
:41:36. > :41:39.apprentice at Lucas Industries and in 1970 gained a PhD in Engineering
:41:39. > :41:43.Production. 10 years after that, Professor
:41:43. > :41:47.Bhattacharya founded the now world famous Warwick Manufacturing Group
:41:48. > :41:52.at the University of Warwick. Now Baron Bhattacharya of Moseley sits
:41:52. > :41:57.in the Lords as a Labour peer. I caught up with him in his natural
:41:57. > :42:00.habitat, a workshop in the heart of the Warwick campus, where 350
:42:00. > :42:04.Jaguar Land Rover and Tata research and development staff are working
:42:04. > :42:09.on the next generations of their top-selling brands. We began by
:42:09. > :42:12.reflecting on his key role as the link-man who'd inspired the
:42:12. > :42:16.transfer three years ago of a much troubled JLR from American
:42:16. > :42:20.ownership under Ford to that of Ratan Tata of India.
:42:20. > :42:27.The company that of course, famously needed state assistance,
:42:27. > :42:31.and then two years later, a billion pounds in profit. What a turnaround.
:42:31. > :42:39.It is wonderful. People used to think that in the Midlands we don't
:42:39. > :42:44.have the talent and we are all lazy, idle, and see what happens. Given
:42:44. > :42:47.the right leadership, a lot of things can happen. Of course, the
:42:47. > :42:53.investment we are seeing going into the new JLR engine plant near
:42:53. > :42:58.Wolverhampton, 1000 more jobs in Solihull, Castle Bromwich, where is
:42:58. > :43:07.this leading to and where will it end? It is great. We are at the
:43:07. > :43:11.start of a great revival. When I speak to Ratan Tata, he always says
:43:11. > :43:16.that Jaguar Land Rover is a Midlands icon and we have to
:43:16. > :43:23.preserve this in the Midlands, and he supports it. Whatever is
:43:23. > :43:28.required, he does. He comes here every month. How many chairmen come
:43:28. > :43:33.and sit and talk to the junior and senior engineers month after month?
:43:33. > :43:37.That is what leadership is all about. Of course, yes, we do have
:43:37. > :43:42.great companies at the top, but the difficulty, of course, is that
:43:42. > :43:47.beneath that there is a long trail of strugglers. That is basically
:43:47. > :43:53.what Britain has been over the last 40 or 50 years. But it wasn't so
:43:53. > :43:57.exposed in the past. Now that we have got great competition, it is
:43:57. > :44:01.getting exposed. What's more, if you visit parts of the West
:44:01. > :44:05.Midlands, the Black Country, parts of what used to be called the
:44:05. > :44:09.Potteries, Stoke on Trent, that area, there is a shortage of skills
:44:09. > :44:13.which really goes against the history of this part of the country.
:44:13. > :44:17.What can be done about it? It is not a question of what a shortage
:44:17. > :44:24.of money. If you look at the amount of money we spend in the Learning
:44:24. > :44:29.and Skills Council, it takes two to tango. It requires the people that
:44:29. > :44:33.want the skills to be involved with developing the skills. In the
:44:33. > :44:39.autumn Budget, they said very good things. The business of the
:44:39. > :44:44.regional growth fund for growth in employment, then the whole business
:44:44. > :44:49.of research and development tax credits becoming easier and above
:44:49. > :44:54.the bottom line, then you have the whole business of apprenticeships,
:44:54. > :44:59.a university, Technology Colleges, science schools, there is an
:44:59. > :45:04.alignment in government with opposition that things have to
:45:04. > :45:08.happen. Successive governments, in a way, lost sight of the importance
:45:08. > :45:13.of the manufacturing industry and were overruled by the City as the
:45:13. > :45:22.next best thing after North Sea oil. -- enthralled by the City. History
:45:22. > :45:27.will tell us that it was easy money, but it requires a tremendous shock
:45:27. > :45:32.for things to change. We have just had that shock. People have
:45:32. > :45:41.realised that we have to rebalance, and once that is understood, then
:45:41. > :45:47.we can get a the young people into apprenticeships, and have one or
:45:47. > :45:51.two icons. You require one or two icons, which acts as a market Paul
:45:51. > :45:56.for others, and that is happening in the Midlands, I think. -- market
:45:56. > :46:01.pool. Maintaining a strong Coventry and Warwickshire presence, Kumar
:46:01. > :46:06.Bhattacharya. You can visit my block fought my thoughts on that
:46:06. > :46:11.conversation. What has Jaguar Land Rover got now that it didn't when
:46:11. > :46:15.you were in charge? It had a bad period under Ford. For the
:46:15. > :46:19.ownership turned out to be, sadly, an unmitigated disaster, but there
:46:19. > :46:23.were many good things there that we Jaguar base, which have come
:46:24. > :46:29.through. We have Ratan Tata's Investment and leadership and also
:46:30. > :46:35.a new product, which has come with key appointments, notably the chief
:46:35. > :46:39.executive, brought in by Ratan Tata, an outstanding industrialist. They
:46:39. > :46:43.have invested more in product and take a longer view and seek
:46:43. > :46:48.consensus with their workforce. Those three things he has brought.
:46:48. > :46:52.We lacked those at Rover. When they were owned by BMW they had no money,
:46:52. > :46:58.no leadership or Investment and continuing strikes. Given the
:46:58. > :47:01.shortage of skills we talked about in the interview, where are the
:47:01. > :47:05.2000 or so it -- or so highly skilled people for the new engine
:47:05. > :47:08.plant going to come from? We had training boards which ensured
:47:08. > :47:15.companies to the training and if they didn't they had to send
:47:15. > :47:17.employees to retain -- retrain. There is no excuse for engineering
:47:17. > :47:21.companies saying they do not have the skills when they have not
:47:21. > :47:26.established links with schools to get apprenticeships going and be
:47:26. > :47:32.self-sufficient. So that is the answer, Jeremy, companies saying,
:47:32. > :47:38.he waffles stop I don't think governments can create growth on
:47:38. > :47:42.their own. Geoffrey is right. We have been successful in the last 18
:47:42. > :47:47.months in creating apprenticeships at all levels, but I think there is
:47:47. > :47:52.a broader problem. When the plant at Solihull was advertising for
:47:52. > :47:56.jobs, they have 1000 jobs to offer and 8000 applications. The problem
:47:56. > :48:01.is broader than that and goes down to the supply chain. JLR will tell
:48:01. > :48:05.you they had great difficulty securing people in the supply chain
:48:05. > :48:09.with the necessary skills. Jaguar Land Rover is an important company
:48:09. > :48:13.because it provides jobs but also because it has an extensive supply
:48:13. > :48:17.chain supplying to it and giving employment there as well. Geoffrey
:48:17. > :48:21.Robinson, I was interested that Baron Bhattacharya is a Labour peer,
:48:21. > :48:24.so he said there was a lot to welcome in the Autumn Statement,
:48:24. > :48:28.research and development tax breaks, apprenticeships and that sort of
:48:29. > :48:32.thing. He is talking about a realignment between the two parties
:48:32. > :48:39.to finally get the message after this tremendous shock, after the
:48:39. > :48:42.crash. Yes. He was right to become one of two things and be optimistic.
:48:42. > :48:46.For certain sectors or companies you can be, but you cannot get away
:48:46. > :48:51.from the fact that we are stagnating, laying people off, not
:48:51. > :48:56.investing and falling further behind. Jeremy Wright. We are
:48:56. > :49:00.behind other regions historically. Investment is happening. I accept
:49:00. > :49:03.there are regional variations but business and industry across the
:49:03. > :49:07.country has invested �3 billion more this year than last, so these
:49:07. > :49:12.things are happening. What is worth bearing in mind that Jaguar Land
:49:12. > :49:15.Rover is that is a global company who could locate manufacturing and
:49:15. > :49:21.R&D operations anywhere in the country. There was clear
:49:21. > :49:24.accommodation from India both for the RMT jobs and manufacturing --
:49:24. > :49:27.clear competition. We have succeeded and securing that
:49:27. > :49:31.investment for the UK which is good for the long-term employment
:49:31. > :49:35.prospects in the West Midlands. Looking at the wider economy, your
:49:35. > :49:38.Prime Minister described high-speed rail as a project that could
:49:38. > :49:42.rebalance the economy. You are in the government but have a
:49:42. > :49:48.constituency issue there. As I understand you're a pro high-speed
:49:48. > :49:51.rail but anti- H S two. I have no problem with high-speed rail as a
:49:51. > :49:55.concert. I think travelling by train or rather than plain is
:49:55. > :49:59.better for the environment and the economy, but my problem is that I
:49:59. > :50:03.think as currently conceived, HS two is not the best way of doing
:50:03. > :50:06.high-speed rail. I have problems with the business case and I think
:50:06. > :50:09.it has picked the wrong route. I think we should follow existing
:50:09. > :50:13.transport corridors when have we can and do less environmental
:50:14. > :50:17.damage that way. Geoffrey Robinson, you have spoken out against it, but
:50:17. > :50:21.how can you deliver the extra capacity required without building
:50:22. > :50:25.a new system and if we are building a new one, why build a slow one?
:50:25. > :50:30.That is not the right way to put it. You can get the extra capacity
:50:30. > :50:38.without building a whole new line, but there is a case for a just two,
:50:38. > :50:42.and I am pleased to agree with Jeremy -- HS two. The point is that
:50:43. > :50:46.you can take an east coast route following the main corridors as
:50:46. > :50:51.they exist without smashing up the whole of the children's and lovely
:50:51. > :50:55.parts of Warwickshire -- the whole of the children's, and to have
:50:55. > :50:59.Spurs including Coventry and Stoke and make its own national railway.
:50:59. > :51:02.We will talk about this again when the government comes up with its
:51:03. > :51:07.decision in January. This is where our own lights are moving out
:51:07. > :51:11.towards the colour red. I have to draw a halt. Thank you for joining
:51:11. > :51:15.us today. That is just about it from the Politics Show in the
:51:15. > :51:19.Midlands today, and indeed for this year, throughout the forthcoming
:51:19. > :51:22.festivities, Midlands Today and local radio will be open for