INVEST, COORDINATE EFFORT AND REACH OUT TO PEOPLE TO KICK-START THE RECOVERY SAYS PARLIAMENT’S WEST MIDLANDS WATCHDOG

The economic downturn has hit the West Midlands hard. Today, MPs on the House of Commons Committee for the West Midlands publish a report looking at how effective Government help has been in supporting people through unemployment, housing issues and debt.

Today’s Report by Parliament’s West Midlands Committee follows its first report, published last summer, which examined the impact of the recession on businesses in the region.

Richard Burden MP (Birmingham Northfield), Chair of the West Midlands Committee, said today

The past year has been a tough one for the West Midlands. Although there are now encouraging signs of recovery, both regionally and nationally, life is still difficult for people who have lost their jobs, who are in debt and who are struggling to pay their mortgages.

We wanted to put together a picture of what has been happening around the region. There is a wide range of help available – from government, from local authorities and other statutory bodies and from voluntary organisations such as Citizens Advice.  We wanted to see how effective all this is on the ground. It is so important for them to work together, to share best practice and to avoid duplication which is both wasteful and confusing to people outside.

This inquiry also reinforced some of the messages in our first Report - about the importance of continued investment in housing and infrastructure to regional recovery, about the need to boost skills and about the fact that parts of the region face long term problems which predate the recession and which require ongoing attention.

We also know that Government institutions and even ourselves as Parliament’s watchdog in the West Midlands, still have a way to go before we can be confident that we are connecting as closely as we should with people’s hopes and fears and how they see the future for our region. That is something we want to address further in the months ahead.

Unemployment and repossessions

The Committee conducted its research in the Autumn of 2009. The number of people applying for Jobseekers Allowance jumped from 102,000 to 183,000 between July 2008 - November 2009 (185,000 in October 2009). By the end of September 2009, the region had the highest unemployment rate in the UK, at 10%, 2.2 percentage points above the UK average of 7.8 %. Worst hit were 16-24 year olds with 26 per cent unemployment rate (figures from Jul to Sep 2009).

The latest unemployment figures published on 20 January showed the West Midlands unemployment rate decreasing to 9.6%. The region no longer has the highest rate in England and the gap between the figures for the West Midlands and the UK average has also narrowed to 1.8 percentage points.  Although this is encouraging news for the region, the key messages in the Committee's report remain valid.

Over a quarter of the areas identified by the Government where people are at risk of house repossession are in the West Midlands. The region has the highest number of households who have received help from the Government’s Mortgage Rescue Scheme (MRS) across England. 

Government support and its effectiveness

Using extra funding supplied by the Government, Jobcentre Plus has taken a number of steps to help people access its services across the region – such as taking on an additional 1,100 staff, extending opening hours on weekends and in the evenings and considering opening new offices. 

The MPs give their support to the initiatives that have been taken by Jobcentre Plus in the region to meet additional demand for its services, and encourage them to continue to explore ways of extending services for as long as demand continues.

Evidence presented to the Committee suggests that the Mortgage Rescue Scheme and other government measures to help families struggling with mortgage or rental payments, have had a positive impact.  Publicity generated by the launch of Government support had also raised public awareness, the Committee was told, prompting more people to seek advice at an early stage.  The MPs are urging the Regional Taskforce to assess which schemes have been most helpful to households in the region and to make sure that information is made known widely.

The region is also benefiting from the funding that Government has made available to build more affordable housing under the Kickstart and Local Authority new build schemes.

The Committee received evidence about the impact of debt on low income families; about the difficulties of low income families face in getting access to affordable credit and about the activities of unscrupulous lenders. Credit Unions (community based financial co-operatives) are praised in the report for providing an affordable source of credit for households and individuals and ensuring there is an alternative for vulnerable citizens who may otherwise turn to loan sharks.  The MPs are urging Ministers to do all they can to ensure that people across the region have access to Credit Unions.

The key role of the “third sector” of the economy – including voluntary and community organisations - is also highlighted in the Committee’s report.  The Committee received important evidence from Citizens Advice about the work they are doing in response to increased demand for advice on debt and other problems related to the recession.  The MPs urge the government, local authorities and other statutory agencies to fully engage with the Third Sector to make sure communities receive the advice and services they need.   

Lessons learned

The MPs are worried that some of those areas most in need of additional Government help may not be aware of new funding that is available and do not have the capacity to bid for it. They say that organisations in deprived areas of the region must be given the help they need to make sure they can bid for funds effectively and build their long term resilence.

FURTHER INFORMATION:

The West Midlands Select Committee is chaired by Richard Burden MP for Birmingham, Northfield. The following MPs are members of the Committee: Mr Adrian Bailey (West Bromwich West), Mr James Plaskitt (Warwick & Leamington) Mrs Janet Dean (Burton),  Dr Richard Taylor (Wyre Forest) and Joan Walley (Stoke-on-Trent North). All of the MPs on the Committee live in the West Midlands and represent local constituencies.

Visit the Regional Committee pages at www.parliament.uk for more information

Committee Information:  David Lloyd e:mail  lloyddr@parliament.uk Tel: 020 7219 6295

Media Information: Nick Davies,  e:mail daviesnick@parliament.uk   Tel: 020 7219 3297 / 07917488141

Watch committees and parliamentary debates online:  www.parliamentlive.tv