Although we have faced a global economic recession, the lasting routes out of it will be local and regional. Every region must have a strategy for re-building and re-balancing its economy, based on local strengths and comparative advantages. Although national policies for supporting the macro-economy are critical, jobs and industries need a local framework.

In Yorkshire, we have a huge pride in our industrial past. From cotton to coal and steel and to retail and finance, our industries have powered the nation and enriched the region. As we plan for the recovery we need to build a future of which we can be equally proud. The Victorian buildings which adorn our towns and cities are a testimony to the riches and the confidence of that era. Our purpose now must be as bold and as permanent – to put Yorkshire back in charge of its own economic destiny.

The 18 years of Tory government and the recessions of the 1980s and 90s hit Yorkshire families and businesses hard. One of its most invidious effects was to rob communities of the sense that they could build a better future for themselves. The true test of the success of our local economic strategies today will be whether it can return to local people true sense of control over their own economic future. That’s why in 1999 Tony Blair and John Prescott set up the Regional Development Agencies, to promote enterprise and drive economic growth in every region.

In Yorkshire and elsewhere the RDAs have been a success. Just look at the facts: the independent study by PricewaterhouseCoopers, released earlier this year, showed that, on average, every £1 spent by the RDAs generates an extra £4.50 for their regional economies. Not a bad rate of return by anyone’s reckoning. A regional strategy is important because every region will be feeling the impact of the recession in different ways.

Last autumn was a devastating time for many businesses and families in Yorkshire as the bottom fell out of our financial sector, especially with 18% of jobs in Yorkshire in financial and professional services. West Yorkshire was particularly affected – most obviously through the collapse and subsequent take-over of what were two of the region’s flagship businesses – Bradford Bingley and HBOS. The current unemployment rate in Yorkshire and Humber is 8.6%, representing 226,000 unemployed people. The national unemployment rate is 7.9%.

But, efforts to keep jobs in Leeds through intensive dialogue between the banks, Yorkshire Forward and central government has kept unemployment below what it could have been. Working with Business Link, Yorkshire Forward is also supporting businesses get the advice they need. That has made a big difference to two businesses I met with recently – like the printing business in Bramley who have had help securing funding to keep business in-house, and the plastering business whose Business Link health check has helped give the bank confidence about that businesses strategy – and so renewing their borrowing agreement.

RDAs can do this work in a way that Whitehall never could. RDAs are closer to the businesses they are supporting, and so are better able to provide what business needs. In construction, manufacturing, tourism and distribution Yorkshire Forward is supporting industry and jobs. But, a regional economic strategy is not just for the recession and recovery – it’s for the long-term. With Labour the Yorkshire Humber economy increased by 60% since 1997, from £54.8bn to £87.4bn in 2007. With a population of over 5 million the Yorkshire and Humber region is the same size as Scotland or Denmark and home to nearly 300,000 businesses. But we could and must do better.

The long-term strength of the region and our ability to compete depends on our skills and infrastructure, yet our region underperforms the UK in terms of skills by quite a margin. In an increasingly globally competitive economy, this is more the case than ever. Increased investment in apprenticeships – 22,000 in Yorkshire next year, the expansion of diplomas, and most important of all, every 11 year old starting secondary school this year will be staying in education until 18 - in school, college, training or an apprenticeship. And, recognising the importance of Higher Education, we had more people than ever start at university this year. Yorkshire’s universities produce 54,000 graduates annually, about 10% of the total in England. These investments will matter a lot in my constituency, Leeds West, where only a third of sixteen year olds got 5 A*-C grades including Maths and English last summer and where the number of young people going to university is among the lowest in the country.

Skills matter for the jobs of the future. There is huge potential in Yorkshire and Humber to be a world leader in green industries and green jobs, which is undoubtedly going to be one of the biggest growth sectors in the world in the coming years. With the right investment and skills, green industries could create 40,000 new jobs. Already, the Humber Economic Partnership and North East Lincolnshire council are at the heart of the development of the offshore wind industry, not least because the deep water of the Humber and the flat land around it mean that a lot of the turbines would be put down close to the Humber estuary. South Yorkshire should also be part of the clean coal of the future. As in the past, Yorkshire has the capacity to power our nation – but only with the right long-term investment and vision.

Government have been engaged in a number of discussions, facilitated by Yorkshire Forward, to ensure that Yorkshire has the infrastructure to enable that to happen. It is crucial for the UK’s energy policy that our energy industries are built up to make us world leaders. The RDAs are enabling that to happen. And, although unfashionable right now, the region must build on its strengths in financial services. Financial and Professional Services account for 18% of employment in Yorkshire. At its heart is Leeds, the leading financial services centre outside London. Those industries currently employ 240,000 people in the Leeds city region, and we have to ensure that we develop our strengths and do not lose the expertise. And, although the fallout from Bradford and Bingley and HBOS has hit the region hard, the rate of job losses is easing and the commitment from Lloyds Banking Group to Yorkshire as one of the three major retail hubs of the new bank shows the ongoing strength of our region as a financial centre.

But despite our advantages, it is not inevitable that Yorkshire and the Humber capitalises on its potential. The economy is at a turning point, and the policies we pursue today will shape the economies and communities of the future. To scrap Yorkshire Forward, as the Tories propose, would rob Yorkshire of the opportunity to shape its own destiny. Strong regional economies to support local businesses and jobs are essential for thriving, sustainable and proud communities and that requires regional leadership and vision.

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