Future of Sheffield: An MP and Minister have their say on business jobs

Tom Richmond: The out of order Minister who showed contempt for Sheffield job losses

Tom Richmond: Why Northern Powerhouse doesn’t stand a chance

Louise Haigh is the MP for Sheffield Heeley.

THE decision to close the Sheffield regional office of the Department of Business, Industry and Skills has been extraordinary. In one fell swoop, BIS Ministers delivered a thumbs down to the Northern Powerhouse, a thumbs down to the taxpayer and a thumbs down to their ministerial colleagues who wax lyrical about the benefits of having key staff outside Whitehall.

Crucial board meetings are scheduled for this month, following the end of the consultation. I urge the Minister (Anna Soubry) to go into them with an open mind. First and foremost, I hope she understands that, for people in our city, a decision to close the Sheffield office would be highly symbolic.

It would be a signal of the London-centric contempt for the North and for the skill and perspective of northerners – a contempt that has prevailed for far too long. The “BIS 2020” plan appears to reinforce that contempt for a regional perspective, with the London headquarters strengthened while regional posts are threatened.

We would have expected the Department to support such a significant decision – to move all policy-making expertise from a northern centre into a London HQ – with some reasoning, but officials and Ministers have told us time and time again that a cost-benefit analysis for this decision does not exist.

As the Minister well knows, taxpayers will continue to foot the bill for the office space in Sheffield anyway, as the entire building is leased by the Department for Education and Skills. Furthermore, BIS is one of the few ​Departments in Whitehall without enough space for staff, so further centralisation will mean that a rent review is almost certain to hike up the rent.

And for what purpose? So far, the only possible reason we have been able to ascertain is the benefit of London water-cooler conversations. Well, those conversations at BIS must be very good indeed. However, there has been no individual analysis of exactly why they outweigh the unique perspective of staff in Sheffield.

Instead, we have seen more tired old thinking from senior Whitehall officials, who, when asked what they wanted the Department to look like in 2020, came back with the same old Whitehall answer: all employees should be within eyesight and earshot of the Permanent Secretary and the Minister. It is astonishing that, in place of evidence, we seem to have a decision costing taxpayers money and reversing Government policy based on lazy assumptions and flimsy justifications.

The Sheffield office could become the eyes and ears of the Northern resurgence. Instead, we will have a centralised BIS, alongside a Department for Communities and Local Government with a Northern Powerhouse Minister whose entire staff is based in London, and a Treasury producing its template devolution deals exclusively from London.

In trying to justify this decision, the Minister will no doubt be adamant that the plan will continue the existing arrangement, with more of her civil servants outside London than in it. This argument does not hold water: all the jobs under threat are distinctly regional, including those in places such as Lancaster, Cardiff and Bristol.

The Skills Funding Agency, with its vast majority of regional staff, is set to be slashed. The UK Commission for Employment and Skills, which has been doing vital work in getting to the bottom of the slow-burning productivity crisis, is set to go entirely. Rotherham, a town where public sector jobs act as ballast, will be left counting the cost. The entire “BIS 2020”plan looks like a perverse counter to the Northern and regional Powerhouse agenda: slash jobs in the regions, take no account of local economies and centralise work in London.

If MPs think I am leaping to conclusions about the way in which BIS HQ in Whitehall instinctively adopts a London-centric approach, they can look at the details of a seminar given to BIS employees early last year by McKinsey and Company – the same company that authored the report into this restructuring.

An item on the agenda read “How can London ensure it outstrips rival cities?” This is the city whose infrastructure spending is more than every other UK city combined. I urge the Minister to think again. She should think about what message these proposals send and what damage they do, and she should put a halt to this decision.

Anna Soubry is the Minister for Business, Industry and Enterprise.

IT is very important that we have as the focus of this debate the 247 people who currently work in the Sheffield office of the Department of Business, Industry and Skills. I make the point that, yes, we have put forward the proposal, but a final decision has not been made.

It has been out for consultation. A final decision will not be made until May 23. Everyone will know that governments of whatever colour have at times to make very difficult decisions, but we have to be sure that we make the
right decisions for the right reasons.

I also make this point, which is very important. Whatever the decision on Sheffield, 83 per cent of the people who work for the Department of Business, Industry and Skills will continue to work outside London.

To some extent, I take a little exception to the suggestion that we in BIS are not in touch with what is going on in the rest of the country outside London. The Secretary of State (Sajid Javid) and I do not represent London seats. We return to our constituencies. Most importantly, we still have an exceptionally fine team of local BIS civil servants working throughout the whole country, who feed in – indeed, I have at least a monthly meeting with them – when they give me a round-up of everything that has happened across the country.

I turn now to the reasons behind the proposal. It is really important to set this in the right context. That context is a mixture, of course, of the financial position that we are in and the decisions that we have rightly made to make sure that we have a budget that we can cope with, and that BIS plays its part in reducing overall spend.

It is not just about cutting money. It is about making sure that this Department works as efficiently and effectively as possible. The situation that the Secretary of State and I inherited was the frankly historical problem of an abundance of sites.

It is not as simple as cutting costs. It is a question of making sure that we have an efficient and effective way of working in BIS, set against the financial restraints that we have quite properly put upon our Department as part of our overall requirements with regard to the deficit.

Our current HQ office locations are based on the legacy I mentioned, and have resulted in a complicated map of management relationships, with work in policy teams spread across 14 different locations. We are committed to reducing our headcount by 2020. That will involve becoming more flexible and redeploying fewer staff quickly to new priorities. We need simple structures that allow staff to interact through quicker, less cumbersome means and stay close to each other in flexible teams.

We rightly put a strong emphasis on staff engagement, ​excellent management, visible leadership and developing and coaching our staff. Those are harder to achieve if teams are not collected together or are not working under the same roof. We believe that having a single-site BIS policy headquarters is the best way to preserve our effectiveness. Given that our teams serve Ministers in Parliament, those headquarters have to be in London.

I want to make this point absolutely clear. Whatever the decision, we will continue to provide good and full support to the 247 members of staff who have had this proposal hanging over them – we are very conscious of that – since January 28. If the decision is made to close the Sheffield office, that support will continue.

I do not need to be told what a great and wonderful city Sheffield is. Because I am from north Nottinghamshire, I spent a great deal of my youth in Sheffield. It was an outstanding city then, just as it is now and will no doubt be in future.

In our devolution deal, we have put Sheffield at the heart of South Yorkshire. Sheffield is at the heart of that deal, with all the attendant money and power that comes from it. That is to be welcomed, and I hope that they (Labour MPs) will make the case for HS2 to have a proper station in Sheffield.

In conclusion, I wish to pay a full and handsome tribute to all staff in BIS. We take their future, work conditions, and the contribution they have made very seriously, but sometimes tough decisions have to be made. This is not just about saving money; it is also about ensuring that the Department works effectively and efficiently.