Tory councils clamour to be 'assisted areas': Towns in the South are competing with those in the North for cash aid

THE PLAINTIVE cry for help from the managing director of Thanet Air, begging the Government for assisted area status, is the most dramatic item among hundreds of submissions being considered by the Department of Trade and Industry. He wrote: 'Please God, before this area dies on its feet, bring your influence to bear on the above application before a decision is made within the next few weeks.'

Thanet is represented by two Conservative MPs - Roger Gale and Jonathan Aitken, a defence minister. In December, its travel- to-work-area recorded an unemployment rate of 16 per cent, compared with a national average of 10.5 per cent. Given that many of the existing assisted areas have far lower unemployment - Accrington and Rossendale (8.1 per cent); Darlington (9.7 per cent) - it must stand an excellent chance of getting back the assisted area status it last held in the late 1950s.

The Clacton travel-to-work- area, in Conservative Essex, recorded the sixth worst unemployment rate in the whole of Britain in December - 16.7 per cent - and must be guaranteed regional aid. But Skegness in Lincolnshire was even worse off; with an unemployment rate of 17.6 per cent in December it was the fourth worst area in Britain, and still classed as a non-assisted area. Comparative unemployment, between areas getting help and those without it, was underlined in a submission from Southend in Essex. It said that, while July unemployment was 10.7 per cent in Humberside and 12.3 per cent in Plymouth, two assisted areas, the rate in Essex was 12.3 per cent - while 11.8 per cent were out of work in the Southend travel-to- work-area. The town's December rate was 13 per cent, putting it well within the criteria for assistance.

The prize is enormous, and it explains why so many boroughs in the Tory heartlands are urging Michael Heseltine, President of the Board of Trade, to help them.

In its latest public spending report, the DTI suggested about pounds 130m would be made available to the assisted areas in the 12 months from April. Between 1985 and 1988, it reported, regional selective assistance had helped create or safeguard up to 1 million additional jobs at a cost of between pounds 500 to pounds 700 per job per year. Assisted area recognition is also a key to European regional development fund money, estimated to be worth pounds 42.7m in 1993-94.

Sir Patrick Sheehy, chairman of BAT Industries, said in a letter to Mr Heseltine in December that assisted area designation for East Kent 'would have a significant impact on economic regeneration and employment creation . . . with considerable benefits through direct capital grants, indirect subsidies and other assistance . . .'

Another letter came from David Willetts, Conservative MP for Havant, in support of the Portsmouth and Havant submission. Writing in November, he said: 'The Portsmouth and Havant travel-to-work-area now has an unemployment rate of 11.3 per cent as against 9.9 per cent for Great Britain as a whole, and 8.7 per cent for the South-east. Indeed, our unemployment rate is now higher than many places which have assisted area status.'

Derek Fatchett, Labour spokesman on the regions, said last night that there was a defence-dependent pattern in many of the southern submissions. 'Defence, for many of these places, was the only procurement, and now that has fallen apart. The jobs being lost are hi-tech. We are losing very skilled technicians.'

That is certainly one of the problems faced by Kingston- upon-Thames, with the loss of its British Aerospace factory. Kingston also complains that because regional aid claims are judged on the unemployment rates of travel- to-work-areas, they are losing out.

The same complaint was made by Bedfordshire county council on behalf of Luton, represented by another two Tory MPs - John Carlisle and Graham Bright, John Major's parliamentary private secretary. In a letter to Mr Heseltine last September, Michael Gwilliam, the county planning officer, said that Luton's problems were being masked by its travel- to-work-area association with more prosperous Watford. While Luton's unemployment exceeded 12 per cent, the travel-to-work- area rate was only 8.9 per cent.

Luton, like Kingston and many other southern supplicants, will not overcome that inbuilt handicap. But some of the southern bids will be successful. That will mean that some of the current recipients of aid in the North will lose out.