I am delighted to be here and to lend my support to the Campaign for the English Regions. Without your organisation and hard work we would not be where we are today - with a Bill in Parliament to prepare for Regional referendums.

The momentum for regional devolution has increased year on year and you have played an important part in that. We have achieved a lot. It has not always been easy. But the fact that we are giving the English Regions the same choice as the people of Scotland, Wales and London is an achievement we should all be proud of.

I'm proud that we have shifted the balance of power away from Westminster and Whitehall and changed the culture that "Whitehall always knows best". I'm proud that we no longer have the most centralised system of government in Europe. I'm proud to have put the footings in place for regional government in England. And I'm proud to be part of a Labour Government that established the Scottish Parliament, the Welsh Assembly and the GLA.

That was a monumental step for any government. And, there is no turning the clock back.

Of course there was opposition. But only one political party has directly opposed devolution. They opposed it in Scotland and Wales. They did the same with London. And they'll do the same again with regional government in England.

Opponents will tell you that this is a move towards a federal Europe and a plot orchestrated by the European Union. It is not.

They will tell you it is a plot to abolish county councils. It is not. They say it will add more layers of bureaucracy. It will not. But I tell you this - I bet they will field candidates for elections to a Regional Assembly. And I bet they will want to have a voice to be heard in the regions.

Since 1997

Since 1997 we've strengthened the Government Offices for the Regions, increased the number of issues they deal with and given them responsibility to take decisions traditionally dealt with in Whitehall.

We've set up nine Regional Development Agencies, which have played a key role in reducing unemployment and boosting investment in every region.

We've helped to establish a network of Regional Chambers and Assemblies which have improved accountability and given the regions a new voice.

And, we've increased the resources of the RDAs and the responsibilities of the Regional Chambers as we have gone along.

Several Regional Chambers are already regional planning bodies and from this April they will all have the responsibility to draw up regional spatial strategies.

Regional Economic Development

We have done all this not from some high minded good intention but because of a hard headed belief that better social, economic and political decisions can be made at regional level.

In the past we have pumped huge sums of money into enterprise zones, subsidies for property development and hand-outs to compensate for unemployment. They have achieved no overall economic gain. They have not helped people get back to work. And they have left whole communities abandoned and on the dole.

Our efforts are now increasingly focussed on measures to encourage and foster indigenous assets, skills, talents and potential for local people and communities.

The emphasis is on drivers of home-grown local economic activity.

To help achieve this we have increased RDA funding from £900 million in 1999 to more than £2 billion by 2005/6. And in addition we have put this in a "single pot", so that they have the maximum flexibility in allocating their resources.

RDAs have put in place long-term frameworks for regional employment and skills. They have for the first time produced regional manufacturing strategies. They have up-to-date regional economic strategies. And they have launched venture capital funds in each region to improve small firms' access to finance.

Our aim is more businesses - not more benefit offices.

In 1999 the rate of business start ups in areas of high deprivation was just one sixth of the rate in more prosperous areas. So we recognise that some areas face a more difficult task than others.

Sustainable Communities

Overcoming those obstacles depends on creating sustainable communities. We are focussing resources in our most deprived areas. Over this Parliament we will put £1.9 billion into the 88 neighbourhood renewal fund areas and a further £2 billion over ten years into the 39 new deal for communities areas.

Sustainable communities need a strong economy, jobs, good schools and hospitals, good public transport, a safe and healthy local environment, high quality design and enough housing to meet the needs of local people.

Two weeks ago I launched the Government's new Communities Plan to address some of these issues. The Plan put in place proposals to spend some £22 billion over three years and to meet the very different problems of low demand for housing in the north and shortage of housing supply in the south.

The Plan is as much a regional document as a national one. Alongside the main policy document we published nine regional daughter document which recognise that many issues are best dealt with at regional level. The Plan deals with the different housing problems in different regions.

That is why we are setting up Regional Housing Boards which will involve the RDAs and other regional partners.

And from April 2004 we will establish a new single pot for housing investment in each region. This will enable regions to set their own spending priorities for housing. For example they might design programmes to meet particular local needs or the needs of one particular group of people.

Of course those regions that opt for regional assemblies will have more powers and more control over policies like housing and economic development which have traditionally been in the hands of central Government.

But that level of devolution of responsibility and resources will depend on success in a regional referendum.

Soundings

We are now coming to a critical time in the delivery of this Government's vision for elected Regional Assemblies.

As you know in December we launched a soundings exercise to assess the level of interest in holding regional referendums. We have asked for responses by 3 March - that is next Monday.

It is therefore of critical that you take the chance to have your say. Responses are flowing in and we expect many more to come. The more we hear from you the better the judgement we can make.

We've got an open mind and no decisions have yet been made about which regions will go forward.

Some regions may not want to hold a referendum. We will respect their views.

But I believe that there is a hunger for English regional government in several parts of the country, and where there is support we will respect that.

My firm hope and intention is for the first referendum to take place before the next General Election.

Once we have considered the level of regional interest in referendums we will direct the Boundary Committee to review the local government arrangements with the view to holding a referendum in those regions.

I am aware, of course, that establishing unitary local authorities throughout a region with an elected assembly will require controversial decisions. But for those regions that want it, I firmly believe that the prize of elected English regional government is worth it.

Announcements

I just want to say a word about two announcements which I am making to Parliament today.

First, our White Paper invited comments on how to involve stakeholders in the work of elected assemblies.

Assemblies will be democratically elected. Our initial view was that it would not be appropriate for non-elected stakeholders to be full members of democratically elected assemblies. Responses to the consultation agreed with that.

However, we don't want to lose all the expertise and commitment that social and economic partners have contributed to the Regional Chambers.

And the consultation made it clear that the best way forward was for elected assemblies to have flexibility in the way they involve stakeholders.

Each assembly will therefore be required to engage stakeholders in their work. This will include involvement in the assembly's overall vision for the region and the regional strategies it will deliver.

Within that framework, assemblies will be able to decide which stakeholders to involve and how to involve them.

Stakeholders might for example be on scrutiny committees, they might help develop policy, or they might work on specific regional strategies.

Regional Assemblies might set up regional 'partnership forums' to bring stakeholders together. Or they might set up consultative groups with different sectors or on different issues.

Assemblies will be able to fund stakeholder involvement in order to develop their capacity to participate.

Crucially, they will have the freedom to make their own decisions about how to involve stakeholders.

Secondly, we announced in 2001 the first Government funding for Regional Chambers. This was to support their RDA scrutiny role and develop their role as a voice for their regions. This has worked well. But, as the chambers know, the funding only covers a three year period up to 2003/04.

I am pleased to say that we can now commit to continue this £5m annual funding programme for a further two years.

This is in addition to the money that will now go directly to the chambers to support their planning role - which in the past had been channelled through local government.

Closing remarks

From this you can see that we are pushing ahead with our regional agenda. The Regional Assemblies Bill is making good progress and received its second reading in the House of Lords last week. Once we have royal assent we will announce which region or regions will go first. The first referendum could be as early as Autumn next year.

That's only 18 months away, which means not just us getting the process right but beginning the planning of your campaign - raising awareness and drawing up support.

The government has its role. Political parties have theirs. But it will be the grass roots campaign organisations like your own which will make the difference.

It's you who people will listen to down the pub and in the supermarket.

Don't misunderstand me, when the time comes I will be on my regional battle bus but the drive and energy you can bring is essential.

This is an opportunity which I relish and which I believe - with your support we can make happen - not just in a few regions but over time across the whole of England.

John Prescott's speech to the Campaign for the English Regions Conference; 24th February, 2003