What happens to the Northern Powerhouse now?

The concept of different localities working together for a collective cause was seemingly rejected by the British people when they voted to leave the EU on June 23. So where does this leave the Northern Powerhouse? Alison Cowie spoke to James Wharton, MP for Stockton South and Minister for the Northern Powerhouse, after he addressed the Manufacturing and Engineering North East conference on July 7.

What is your reaction to the referendum result?

I’m very pleased. Europe is a very important trading partner and we now have to decide what our relationship with our European partners will be. But there’s a much bigger world out there and we can now look to make trade agreements with places like China and the United States. This is a big opportunity, particularly for an exporting economy like the North East.

What about Prime Minister’s David Cameron’s resignation?

I’m very disappointed. I think [David Cameron] has achieved a great deal but I understand why he decided to go. What’s important now is that we get stability, focus and a new prime minister in place who can set our vision for our place in the world.

 

The Northern Powerhouse is about different places, with their own individual interests, working together for a collective cause. But the British public have just voted to leave the EU, a position you supported. Isn’t the EU offering the same thing but on a larger scale, meaning the Northern Powerhouse is now unachievable?

I disagree. When we joined the EU initially, it was a trading block, which was welcomed at the time. But over decades it has gone from a positive trade cooperation and agreement proposal to becoming a political construct which is undemocratic and inflexible to be able to respond to the needs of the global economy. I want to continue trading with the member states of the EU but I think we’re better out of it and can control our own future.

So you’re still committed to the Northern Powerhouse and it can work?

I believe not only that the Northern Powerhouse can still work but it can thrive. We have a lot of exporters in the North of England. The EU share of the world economy has halved in size since the early 1980s. The rest of the world has been growing. This is our opportunity to look out to the rest of the world. Yes, we still want to trade with Europe but we can now look at the growing parts of the world into the future. Because that’s where future growth and success will come from.

There seems to be a dichotomy between the UK’s economic need to have access to the single market and the desire for immigration control from many who voted to leave the EU. We can’t have both, can we? So what’s the answer?

I’m not going to make assumptions about why people voted. The people have given a clear instruction to our politicians for the UK to leave the EU and that’s what we must do. We have to negotiate the best access that we can in the markets and that’s going to be more in EU member states’ interests than ours as we buy significantly more from them than we sell. I’m confident that we can get a good deal. I want to see the freedom of movement challenged and addressed but that doesn’t mean pulling up the drawbridge and saying no one is allowed. It means ensuring that if people do come here they come here to contribute and to help our economy and to help our society.

The North East has benefited from a lot of EU funding. How will the region ensure this level of funding continues?

The first thing I would say is that nothing is going to change for at least two years while Britain negotiates its exit. So the funding will stay and we will continue to deliver those programmes. Britain invests far more in the EU than it gets back so, in the future, the UK Government will be able to spend more in areas, if it chooses to do so. I want us to continue to deliver on our commitments [to funding], particularly in regional economic growth – it’s important to the North and the North East, in particular. I think we’ll be able to do that better in the future than we’ve been able to in the past.

What do you say to the British public, particularly young people, who are disillusioned about the referendum result and can see only negatives?

I know there are those people who voted to remain who are upset and feel they didn’t get the outcome that they wanted. But we live in a democracy and people have voted, particularly in the North, to leave and we now have a responsibly to deliver that.

I believe the result has huge positives. We’ll be able to free our businesses and our economy from much of the unnecessary red tape and regulation. We will have real democratic control over our country and we can decide our country’s place in the world now. We are free to make our own trade agreements and make arrangements with places that are growing, rather than the EU. This is an incredible opportunity and we all have a duty to talk up the incredible opportunities that our economy can have and to ensure, working together, that our future place in the world is a bright and successful one.

But is it going to get worse before it gets better?

There’s no reason why we should suffer at all. Our relationship with Europe is not going to change in the short term and at the point when it does change – after the two-year negotiation process – the UK should be in the position where it has the relationship it wants with Europe as well as the relationship it wants with the rest of the world.

You spoke at the ME North East conference today. What was your message to the region’s manufacturers and engineers?

My message was two-fold. Firstly, that over the last year, we’ve put in place the foundations to build the Northern Powerhouse into the future and we’re now moving to seeing that come to fruition. We’re going to see the election of metro mayors who have real powers. We’re going to see the Northern Rail Franchise, which was signed earlier this year, start to deliver new rolling stock and improved connectivity across the North. And Transport for the North will continue to make the case for strategic transport for the future. The UKTI has been delivering strategic work in terms of selling the North to the rest of the world and we’re now looking to how to deliver on those opportunities. So my message was to the people who actually make the North successful, who employ people and create growth, that now is the time to get on board and drive the [Northern Powerhouse] agenda.

The second message was that the people have very clearly spoken [via the EU referendum] – doubly so across the North of England, where the votes to leave the EU were emphatic. We now have an instruction from the British people to deliver the exit of the UK to the European Union. Some people supported that, some people, we know, didn’t. But we now must come together to ensure it is successful.

On July 17, it was announced that James Wharton MP would be replaced by Yorkshire MP Andrew Percy. Mr Wharton becomes minister for International Development  

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