If the Committee will look on the Order Paper they will see a whole list of Votes. I have no desire to curtail debate at all. I think hon. Members will find that they can cover a fairly wide field, which may well take up a considerable time. I think that as my own salary is down for discussion, it obviously covers a good many subjects.
When this Government took office at the end of 1951 the country as a whole was facing a serious economic crisis, and drastic action had to be taken—not action of a popular character, of course—but the result was that in 1952 we experienced a very difficult year because severe import restrictions had to be imposed and resulted in a falling off in vital exports due to the action taken by certain other countries in the sterling area.
On the whole, we have been progressing since then. The gold and dollar reserves of the sterling area are approximately one-third higher than at the beginning of last summer, and our industrial production has recovered from the setback which it experienced in 1952. Inflation has been held in check, and we can now contemplate some increase in the output of goods and services without being frustrated and held back by shortages of steel and other vital materials such as was the case.
With regard to production in Scotland, people were naturally perturbed by the fall in the first three-quarters of 1952. This is set out in the Digest of Scottish Statistics. However, the figures for the full year have now been calculated, and I am glad to say that good progress was made in the last quarter. The fall had been checked by the end of the year, and the figure for the last quarter of 1952 was equal to that for the last quarter of 1951. For the whole of the year 1952 the figure was 11 per cent. higher than for 1948.
Unemployment, to which reference has rightly been made, has, of course, been a source of concern to all Governments since and, indeed, before the war. I am glad to say that there has been an improvement in the latest published figures. Whereas in January, 1953, the figures of unemployed were 81,541, at 15th June they had fallen to 56,556. I admit that this is partly a seasonal decline, but the decrease is far greater than the normal, and to that extent the figure is satisfactory and, indeed, better. In fact, it is an indication of the general improvement in our trading position. I admit, also, that Scotland has greater leeway to make up than has her southern neighbour. The present figure of 2·7 per cent. compares with 3·2 per cent. in June, 1952, and is back to the same percentage figure as for June, 1950.
As to the measures which can be taken to help deal with this employment problem in Scotland, this subject covers a wide field, and the reason I have referred to it in opening is that, in the first place, we must have sound economic conditions in this country. My right hon. Friend the President of the Board of Trade will, no doubt, refer to other measures tomorrow, but I should like briefly to refer to the three main areas of serious unemployment. These are the Development Areas, the North-Eastern Zone, including Buckie and Peterhead, and the Highland area.
The Development Areas, as hon. Members know, include much of the old-established industry in Scotland. They also include much new industry which is now taking root in Scotland—for example, mechanical engineering developments—and much of this new development is due to the special attention which has been devoted by successive Governments under the Distribution of Industry Acts. The achievements of that policy have resulted in suggestions made from various quarters that this policy should be applied to other parts of the country. But I suggest that dilution of the policy would defeat its own ends.
This brings me to the Government's decision about the Cairncross Report. This was fully debated in the House on 25th February, when the President of the Board of Trade spoke on this subject, and I will not repeat what he then said. I also wrote recently to the Chairman of the Scottish Council, Lord Bilsland; the right hon. Gentleman referred to that letter in the course of his speech.
I am sure that all will agree in desiring to help and nourish new industrial development, but where the Government part company from the Report is in its implication that this should be at the expense of the Development Areas. This may not have been the intention of those who wrote the Report but I am afraid that, provided that the amount of Government help is limited that would be the result.
It is precisely the same as if one has a pot of jam and is then given more slices of bread to smear it over—the more slices the more thinly spread does the jam become. The heaviest burden of unemployment is still concentrated in the Development Areas. Therefore, we feel that it is in those areas that we must still concentrate the main energies.
I should like to refer to one other point in connection with the Report which described this work as being in the nature of salvage operations. I suggest to the Committee that in many instances the distribution of industry policy has brought new life and hope to those areas, so that it is not quite fair, in my opinion, to refer to the work which has been done merely as "salvage."
Further, I should like to suggest to the Committee that the policy which the Government are pursuing is sufficiently flexible to help with developments elsewhere. For example, take the great development at Grangemouth, which is not in a Development Area. In Fife, there is building the new town of Glenrothes. Buckie and Peterhead, to which the President of the Board of Trade referred on 25th February, has been selected for special treatment, and discussions are now going on, and have been going on lengthily with the Scottish Council in connection with that.
In the Highlands, special measures are being taken, but I will, if I may, refer to the general Highland question in a few minutes. All I wish to say about this development policy is that new projects brought forward for other areas will be encouraged in every way in which we can give encouragement, but I do not believe that to schedule new areas as Development Areas is necessarily the right policy, for the reasons which I have given; and we must concentrate our energies, which are necessarily to some extent limited, on the areas which we believe to be most in need of that attention.
I referred at the beginning of my speech to the importance of agriculture, which no one will deny. Three other traditional basic industries in Scotland are steel, coalmining and shipbuilding. I shall also refer later to fishing, which is another. The higher rate of crude steel production which was visible in the second half of 1952 has been maintained. Production in the first quarter of 1953 was 23 per cent. above that in the same quarter of 1952. From the Scottish point of view this is distinctly encouraging, as the increase for the whole of the United Kingdom for the same period was 14 per cent. whereas in Scotland it was 23 per cent. Production in April and May this year is the highest since 1950.
This increase in steel production has been brought about by the improvement in the supply of materials, particularly scrap, and the higher rate of production should, I believe, be maintained throughout the year. Further developments are now under consideration affecting the steel industry in Scotland. Among these, it is generally recognised that a vital factor is the expansion of pig-iron production. Supplies of steel to consumers both in Scotland and in the United Kingdom are now considerably better. It is significant that stocks held by consumers in Scotland rose by 17 per cent. in the second half of 1952.
The coal industry, as hon. Members who have intimate knowledge of this industry will be aware, is now in the midst of a period of great change, and I think it is a tribute to those concerned with this transition that there has been comparatively little disturbance. Most—82 per cent.—of the miners in effective employment who became redundant owing to the closure of collieries since 1948 have been placed elsewhere. The labour employed has risen slightly, and the output of saleable coal in Scotland has risen by about 0·5 per cent. for the first five months of 1953 as compared with the same period of 1952. That does not mean that output is anything like as high as the Government would wish but it is rather remarkable what has been achieved during this period of transition. The new pits are going ahead——