“We Need to Fight New European Commission Regional Aid Proposals Which Will Hit Teesside’s Industrial Prospects”

Middlesbrough South and East Cleveland Labour MP, Tom Blenkinsop, today (23rd March 2012) hit out a new possible European Commission guidelines on regional aid for industrial development which are, he said, ‘an arrow aimed at the heart of much of Teesside industrial base’.

Tom said “Teesside, like many other older industrial areas of the UK, is currently on the European Regional Aid map, which allows for local agencies and the Business Ministry to apply for EC cash to help inward investment and for business expansion which leads to jobs growth.

Now the Commission’s Competition Directorate has issued a discussion paper which suggests changes to the regulations on the targeting of this aid cash. Crucially, they are now suggesting that it be restricted to only apply to Small and Medium Sized Enterprises (SME’s) after the new round of regional aid begins in 2014.

Now in some parts of the UK, this might pass without comment. But it is an arrow aimed at Teesside economic heart. Historically Teesside’s economic base has been in chemicals, steel, port related employment and heavy engineering. That remains the case today, and of recent years much of our job creation have been in these sectors, such as with PD Ports and the associated distribution centres, the Nifco plant at Eaglescliffe which will be supplying Nissan and investment at both Wilton and Billingham and Wilton where firms like Huntsman, Sembcorp and Air Products have made major investment decisions.

What all these examples have in common is that they are all large firms, as the economic drivers and sectors of importance to Teesside are dominated by their very nature by large employers. SME’s are valuable, but they don’t build multi-million chemical plants or steelworks. We should encourage SME’s, obviously, but in this area, they depend on supply-side orders and the wealth generated by large firms for their existence.

To make matters worse, the EC has to review the Assisted Areas Map after 2014, and given the scale of problems in Southern Europe, and the unpopularity of the UK in Europe arising from our Prime Minister’s ‘little Englandism’, the UK – and Teesside – may be in the firing line is areas have to be deleted from this map.

I will be urgently be making representations to both Business Ministers and to our local Member of the European Parliament, my colleague Stephen Hughes, to build up a case to make the Competition Authorities in Brussels think again on these ideas – certainly as far as Teesside is concerned.”

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