Orders of the Day — Factory Building, Sunderland

– in the House of Commons at 12:00 am on 10th April 1959.

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Motion made, and Question proposed, That this House do now adjourn.—[Mr. Brooman-White.]

4.3 p.m.

Photo of Mr Frederick Willey Mr Frederick Willey , Sunderland North

I wish to raise a question which affects my constituency, namely, the high incidence of unemployment and the need for more factory building.

I would say at once that I appreciate the reasons which have prevented the Parliamentary Secretary to the Board of Trade from replying to the debate, and I look forward to the reply by the Minister of State. I appreciate also that since I first raised this matter at Question Time, the situation has, in a sense, been recognised by the Government, because we are now a specially designated area under the 1958 Act.

In the first place, I should like to emphasise the need for such factory building and the serious concern that we feel in Sunderland owing to the rate of unemployment. This year our unemployment has exceeded the 5,000 mark and has touched 6 per cent. Fortunately—of course, we all welcome this—it has fallen during the past two months, and the March figure is 4,679. But that figure is 1,000 more than it was in 1951, and it is 50 per cent. more than it was last year when in March unemployed were 3,045. We have to remember also that in March, 1957, the unemployed were 2,521 and in 1956 2,202. I mention these figures because they show what has been happening in Sunderland over the past few years.

I would mention also that in Sunderland, as we have adjacent to us other areas which have a high rate of unemployment—in fact, Jarrow and South Shields are also specially designated areas, and there is a high level of unemployment in Hartlepool—our unemployed cannot seek work within easy travelling distance in neighbouring localities. We hope —and I trust that the Minister of State hopes also—that this unemployment is cyclic and that we can look forward to a further reduction in unemployment this year.

Apart from this unemployment, we are worried also about the danger of structural unemployment. We are still today as dependent on heavy industry, particularly shipbuilding and ship-repairing, as we were before the war. Various estimates that have been made both by Government Departments and by private industrialists have all indicated that unless we are extremely fortunate we shall face redundancy of several thousand within the next few years.

I would remind the Minister of State that we had 19,000 unemployed in 1939. which was a relatively good year, and we have had as many as 30,000 unemployed in Sunderland. I mention those figures not because we have any intention of talking ourselves into a depression—that is the last thing we want in Sunderland because of the experiences we have undergone before—but to impress on the Minister of State that our present rate of unemployment has naturally caused a good deal of apprehension and has emphasised our essential dependence upon the heavy industries.

It is against this background that we think that in recent years we have not always had a fair deal from the Government. We have had several projects—Boldon Airport, the abattoirs which have not yet been begun, and the River Wear Commissioners have had several projects which they were not able to proceed with. The fact is that we have not obtained any new major industry in Sunderland since the war. We had Bristol Aero engines—a very welcome acquisition to the town—but we have not had any new major industry and our share of the balance of new employment has never matched our share of unemployment.

I summarise this background by saying that the position in Sunderland is that we have unemployment running at about 5,000. although we hope that this will be only temporary. At the same time, in the not too remote future we believe that we may have to cater for redundancy which may well amount to 5,000 and which, in the light of various studies that have been made, is, I believe, a cautious figure.

Against that we have the present trading estate which has made a substantial contribution to the provision of new employment in Sunderland. But again we must realise that the factory building was largely carried out in the years 1945–1950 and merely redressed the balance against Sunderland owing to the fact that during the war we were a vulnerable area and we did not get the new factory building which many other industrial centres got.

The position about the North Eastern Trading Estates Limited is that in 1951 it was employing 5,544 people. Today it is employing 5,027, which is 500 less, although I concede that we have to make allowance for Price's factory which was sold to Bryan Mills and no longer comes under the North Eastern Trading Estates. In any event, North Eastern Trading Estates now employs 400 less than in 1957. That may be again largely due to the factors which have affected the employment position throughout the country. However, I ask the Minister of State why more should not in fact be employed on the trading estate. I know the estimates that have been made about prospective and potential employment in the past. It seems to me that we should discard those estimates and that we should be more cautious about estimates of employment that is to be provided by new projects. It seems to me that we cannot reasonably expect the trading estates to provide employment for more than 5,000 or 6,000 people.

I call the attention of the Minister of State to an interesting factor which has affected employment in the trading estates. It is not altogether unwelcome, but is something to which we must pay attention. The estates now employ 800 more men than in 1951 but 1,300 fewer women. I mention this because in 1951 we took the view that we had made sufficient provision for the employment of women by way of new factories. It looks, however, as though now, in the light of what has happened on the trading estates, possibly we should review this and see whether more provision should not be made for the employment of women in Sunderland.

In the present situation, I also ask the hon. Gentleman to be particularly cautious in the sale of factories. I appreciate that the sale of Price's factory was in special circumstances, but I would not like the Government to be anxious to sell factories at present because this creates the impression that they are less interested in development area policy.

Against the provision which has been made on the trading estates, we cannot avaid the conclusion that within the next few years we should seek to provide additional employment for about 5,000 people in Sunderland. It is for this reason that I am reviving a proposal, which I put forward in 1949, that we should provide in Sunderland a new trading estate. I put this forward now because today the Government are patently anxious to provide for capital development. The proposal which I put forward in 1949 received general acceptance and it was agreed that such a trading estate could be provided on the north bank of the River Wear.

We need such a site, especially in Sunderland, because there is no site in Sunderland at present which could be shown to any large industry with any hope of attracting such an industry to the town. We should try as far as possible to attract some new large enterprises to Sunderland.

We would need, possibly, a site of about 100 acres, but in putting forward this proposal I am not being so ambitious. The site on the north bank of the Wear is a 75-acre site but would provide only about 35 acres of factory building. This is a matter which has been previously considered. A working party from the former Ministry of Town and Country Planning believed the site to be the most satisfactory and a survey has been held at the site. I urge the Government to proceed at once with the preparation of the site and to ensure that in this way we are in a position to attract industrialists to Sunderland.

The site has become even more attractive in recent years because we have had considerable new housing on the north bank of the Wear. That is the proposal I make to the Minister of State. At the same time, I call his attention to the fact that the Sunderland Corporation is making a proposal to him about three sites which will amount in all to about 20 acres. The Corporation will be asking the hon. Gentleman to spend about £126,000 in developing these sites.

I concede at once that this alternative proposal should also be considered. I have on occasion put forward a third proposal that we should build an advance factory or factories in Sunderland. What I am asking the Minister of State to recognise is that as Sunderland is at present, it is extremely difficult to make an attractive proposition to an industrialist to come there.

Finally, I call the attention of the Minister of State to the fact that the Sunderland Corporation has suggested that there should be a deputation from the Corporation—and I am glad to see associated with it the Secretary of the Chamber of Trade—to the Regional Controller of the Board of Trade and to the Chairman of the Trading Estate Co. I made the suggestion some time ago at Question Time that the Regional Controller of the Board of Trade might take the initiative in bringing together the local interests affected and the people concerned with Development Area policy. I now ask the Minister of State whether anything has yet been done. What we want is a deliberate effort to bring about a co-ordinated concern and awareness of the provisions of the Acts relating to the distribution of industry. We should deliberately try to encourage local initiative towards positive action and bring in as many people as possible. I mentioned the River Wear Commissioners. I think that the shipbuilders themselves should be brought in in these discussions, together with other Departments, such as the Admiralty.

I have no hesitation in putting forward this proposal for Sunderland, because, after all, the Government themselves, by the specially designated areas, have recognised that within the Development Areas there are at the moment special and particular problems. I would not mind if Sunderland were associated, if it were thought convenient, with Jarrow and South Shields. I want a recognition of the particular difficulties of Sunderland, and I want associated with any Government action the local interests themselves so that we can get a positive forward-looking view of the needs and requirements of the next few years.

In passing, I pay tribute to the Sunderland Echo, which at the end of the year produced an excellent supplement on the year's work. This at any rate helps in getting an overall view of the needs of Sunderland.

I particularly emphasise to the Minister of State that I feel that at present, in spite of the special provisions made for Sunderland, there is not sufficient knowledge of the provisions of the Distribution of Industry Acts and, in particular, not a sufficient knowledge, in spite of the action which the Board of Trade has taken, of the provisions of the 1958 Act.

I should like to give two illustrations to emphasise the importance of such knowledge. Recently, when I raised the question of shipbuilding, I mentioned credit facilities. Following that debate. representations were made to me about two orders which had been placed with France and an order which probably would have gone abroad also. My attention was also called to a prospective cancellation. This action was being taken on the ground of lack of credit facilities. I am glad that as a result of the debate an approach was made to the Admiralty and we obtained that order and avoided that cancellation. The lesson which I learned from that was that a better knowledge of the facilities available and of the attitude of the Government was obviously needed, even in shipbuilding circles.

The other illustration concerns Steel's Crown Works. I have just received representations that there may be fairly substantial redundancy at those works, of which we in Sunderland are very proud. They make Cole's cranes and have an excellent export record. I am told that here there is the possibility of a Government order coming to an end, which will create redundancy. This may reflect itself on costs and export prospects. Again, I doubt whether sufficient action has been taken in approaching the Government. I think that we should ensure that there is a better knowledge of the advantages which can be obtained from the provisions about development areas.

In conclusion, I hope that what I have said will evoke an instructive reply from the Minister of State. As I have said, we do not want to talk ourselves into a depression, but we recognise that we in Sunderland have special difficulties, and we want co-operation in overcoming them. The present position is that not only have we a higher rate of unemployment than we have had since the war, but there is a general feeling that there is an absence of a Development Area policy and today a lack of the positive constructive approach made in the early years after the war. I am sure that I speak on behalf of everyone in Sunderland when I say that we are willing to do the best we can to overcome our difficulties, but in this we feel entitled to have the Government's full co-operation.

4.20 p.m.

Photo of Mr John Vaughan-Morgan Mr John Vaughan-Morgan , Reigate

I am grateful to the hon. Member for Sunderland, North (Mr. Willey), who, incidentally, I welcome back from East Africa, for the very fair and restrained way in which he argued the case for more factories in Sunderland. I am grateful to him, also, for having given me advance notice of the points he intended to raise.

I think that I ought to start with an apology to the hon. Member. Normally, the Parliamentary Secretary would be answering this debate, because he is particularly concerned with unemployment, but he is in Wales at the moment. The President of the Board of Trade is engaged at a very important interview. Therefore, it falls to me to answer the debate.

The President of the Board of Trade intends to pay a visit to County Durham in June, but it is not yet certain whether his programme will allow a visit to Sunderland. Of course, if it does not, my hon. Friend the Parliamentary Secretary might be able to visit the area at a later date.

There is certainly no difference at all between the hon. Gentleman and the local authorities, on the one hand, and the Board of Trade, on the other, as to the objective at which we must aim, that is, the relief of unemployment. As he said, Sunderland was added on 10th March to the list of places for which financial assistance was available under the Distribution of Industry (Industrial Finance) Act, 1958. I give the hon. Gentleman credit for pressing us to do it earlier, but I assure him that we included Sunderland in the list as soon as the situation warranted our doing so by the standard which we use.

After all, we must have some objective standard if we are to act fairly between one place and another. We must face the fact that the Act would be frustrated if the standard were either so exacting that hardly anywhere could be helped or so lax that half the country was on the list and we could not concentrate our efforts on the places which really most needed them.

The D.A.T.A.C. list at present covers a little under 15 per cent. of the insured population of Great Britain and, of course, a much higher proportion of the unemployed. In our view, that is about the limit to which we should go if we are to help the worst places. Anyway, this is all past history, and Sunderland is now on the list. I hope that the D.A.T.A.C. facilities will prove of very real value to the town.

The hon. Member wants us to go further and be prepared to build factories in the area for letting to industry. I am only too ready to agree that over the last fourteen years Board of Trade factory building has been of great value to the Development Areas. The factories have given direct employment to nearly 200,000 people and, indirectly, have been of great value to very many more. Although we have power to build anywhere in a Development Area, we are exercising the power at present only in places where it is most needed. It is commonsense that we shall be less likely to induce industry to go to the remoter places, such as Dundee and Greenock, if more readily accessible alternatives are open to industry. That is why we have been deliberately restricting the scope of factory building more narrowly even than the D.A.T.A.C. assistance.

However, we are not rigid in our approach. Only recently we added North-East Lancashire, North Lanarkshire, and Merseyside to the areas where we are prepared to build. If the situation in any part of the North-East Development Area should justify it, we shall consider extending the exercise of our power to such a place.

We feel that Sunderland's need is not for new factories as such so much as for new industry. I am far from convinced that, even if we were prepared to negotiate with firms for building factories for their occupation, we should have many inquiries. There are now five empty Government factories in the area surrounding Sunderland as well as a number of empty privately-owned factories. Here are empty factories. Why add to the number? What is lacking is not existing buildings, but firms anxious to expand, not tied to particular places and willing to move into new areas.

The revival of the economy, of which there are already evident signs and which we hope the Budget will stimulate, should result in a greater movement of industry, of which I hope Sunderland will enjoy its share.

I was very interested to hear of the proposal of the Sunderland Corporation to buy three sites for industrial purposes. I have seen a cutting from yesterday's Northern Echo which refers to this project. The hon. Member will not expect me to comment at this stage on a proposal for which we have not yet received an application, but I can assure the hon. Member that when it does reach us we will consider it carefully.

The hon. Member's suggestion that the Board of Trade should create a new trading estate in the Sunderland district goes a good deal wider. I appreciate his concern over the structural unemployment in Sunderland, and though I think that he is much too pessimistic in his estimate of its extent, I share his anxiety to ease the burden by finding some way of diversifying the pattern of Sunderland's industry.

I doubt whether the acquisition of another site on which Government factories can be built would have any effect in steering fresh industry to the area. There are now 14 empty factories on our industrial estates in the North-East Development Area—including the five I have referred to—and there is land in the Sunderland district zoned for industrial development. There are now also the inducements of D.A.T.A.C. for private building.

It is very doubtful whether the expenditure of public money in laying out another estate would be justified, but I emphasise that we have not set our faces against ever building in Sunderland. If we were convinced that this would materially help Sunderland's prospects of getting new industry, we should certainly be prepared to reconsider our attitude.

I should like to refer to one particular point about the threatened redundancy at Steel's Crown Works, in Sunderland, the firm that makes Cole's cranes, and here I come into my own. The firm exports about 40 per cent. of its production, so I give it a very good mark for that. I have been made aware that this firm is reorganising with a view to carrying through an even more aggressive selling policy at home and overseas. It is its intention to continue production to the fullest extent in its Sunderland works and if there is any redundancy it will be on a very small scale due only to a decline in sales of one or two of the firm's products. I should be sorry indeed to think that this firm, which employs over 2,000 workers, was reducing its activities in Sunderland, but I am confident that that is not the case.

The hon. Member referred to the placing of contracts. The House will appreciate that the Board of Trade, as such, cannot influence the direction in which Government Departments place their contracts, but there is a contracts preference scheme, operated by both Government Departments and nationalised industries, whereby a firm in an unemployment area can receive a preference over firms elsewhere, provided conditions are equal. We will give the firm in question further details, as I have come to the conclusion that this scheme is not as well known as it ought to be. We will also see what can be done as a result of further publicity in the Board of Trade Journal.

I want to endorse what the hon. Member said about co-operation between the Regional Controller, the North-Eastern Trading Estates Company and local authorities. We will certainly do all we can to give such authorities the fullest information as to available factories and sites, and we rely on them in their turn to spread the knowledge abroad.

As an example of this co-operation, the Wearside District Advisory Committee has been considering what more can be done to attract firms to the district. In the last resort it is for the towns and districts to sell themselves to industry and the efforts of the Corporation and of the District Advisory Committee are very welcome.

I should like to point out that much has been done for Sunderland in recent years. Since the end of the war, 89 projects have given employment to more than 7,100 workers and schemes to provide employment for another 300 are planned or under way. Estimates are sometimes optimistic, but the figure of 7,100 is one of past achievement and represents 8 or 9 per cent. of the insured population. It represents a tremendous step towards diversifying industry in Sunderland and I hope that that process will continue.

If I may end on a slightly less serious but none the less important note, I add the hope that Sunderland will get back to the First Division next year.

Question put and agreed to.

Adjourned accordingly at half-past Four o'clock.