Treasury Committee


The Treasury Committee will be conducting an inquiry, with oral evidence commencing in the New Year, entitled "Regional Productivity".

The inquiry will explore Government policy towards addressing the regional productivity gap. This gap has been viewed as fundamentally a market failure caused by, for example, regional skills gaps, uneven distribution of innovation across the UK, insufficiently flexible labour markets and inadequate access to start-up finance in some regions of the UK.   A raft of policy initiatives including the regional development agencies, regional venture capital funds, Faraday Centres, SureStart, University Challenge, SMART and Enterprise Areas have been introduced as a means of addressing some of these issues.

A focus for the inquiry will be the progress made towards achieving the relevant joint Treasury/DTI/ODPM public service agreement target in the 2002 Spending Review. This was to "Make sustainable improvements in the economic performance of all English regions and over the long term reduce the persistent gap in growth rates between the regions, defining measures to improve performance and reporting progress against these measures by 2006". The Committee will be concentrating on the input from the Treasury & Revenue departments, and will wish to assess progress made and value for money achieved.

 Issues the Committee will be looking at include:

-the reasons for the productivity differentials between regions;

-the operation and effectiveness of the various programmes to address the productivity gap at a regional level (including extent to which they might be streamlined, and their effectiveness in changing behaviour towards a more enterprising/aspirational culture);

-the contribution of:  measures under the Lisbon Agenda (including the relative effectiveness in this area of 'horizontal' measures applying across all regions and 'vertical' measures targeted at specific regions); 'clusters' as a route to greater regional development; the Regional Development Agencies (though detailed examination of this area is under examination by the Trade and Industry Select Committee, due to report shortly);

-the measurement of flows of  domestic and EU public expenditure into the regions, and the effects of such flows on productivity/growth rates.

The Committee would welcome the submission of written evidence (which may include material not written specifically for the Committee).  If written evidence is very brief, it can be sent as a letter, but otherwise it is helpful for the evidence to be in the form of a self-contained memorandum.   If longer than one page, memoranda should have numbered paragraphs (if a memorandum is later printed, page numbers will change, so it is helpful to be able to refer to paragraph numbers). If long, a memorandum should include a one-page summary of the main points, and a table of contents.   It would be most helpful to the Committee to receive submissions in electronic format:  these should be sent either on disc to the Committee Office (address above) or by e-mail to (with a covering letter confirming that it is evidence to be submitted to the Treasury Committee).

Submission of any material by 26 January 2004 would be helpful