I am glad to have this opportunity of drawing to the attention of the House the question of the shortage of work at Woolwich Arsenal and of asking the new Parliamentary Secretary some questions about the future of the R.O.F. at Woolwich. I am aware that it is not only the Woolwich R.O.F. which has this problem, and I shall be as brief as I can in order to enable other hon. Members, who, I know, have a personal constituency interest in the problem, to say a few words if they are fortunate enough to catch your eye, Mr. Deputy-Speaker.
The position at the Woolwich R.O.F. roughly is this. In recent years the factory has been modernised and concentrated, and a great deal of money has been spent on making the plant and machinery and buildings up to date. We have a first-class plant and a skilled and experienced team of workpeople, but there is an appalling shortage of work. The best shops have about three months' work. Several shops are down to one to two weeks' work. Under-employment is chronic. Over the last six months there has been a wastage of 67 skilled and 123 unskilled workers. These people have left employment in the R.O.F. and thereby have thrown away their claims to gratuities and pensions. Rather than stay on waiting time of £8 5s. to £9 12s. a week, these men have thrown up their pension and gratuity rights.
Despite this wastage over the last six months, 144 more workers have just been declared redundant and are to be given their cards on 2nd and 9th December. I want to ask the Minister why this time has been chosen to declare these men redundant, just before Christmas, when, as everybody knows, two statutory pay days holiday are required and therefore employers are not keen to take on men. I want the Minister to answer the question why it is necessary to keep these men hanging on, often at these bedrock waiting time wages, and then to sack them just before Christmas when they cannot have a good chance of getting new jobs. Surely, the Government should set an example to the rest of industry and not take the lead in a thoroughly unimaginative and unnecessary act of dismissal at this time.
We have this shortage of work, we have the wastage and we have the redundancy. I want the Minister to try to justify this. Why should all the money which has been spent on the new plant and machinery and on the concentration at Woolwich be left idle and men allowed to go on waiting time like this? We are told that it is because a reserve needs to be kept for military purposes, for an emergency. I have heard this argument as long as I have been a Member of Parliament for Woolwich. It simply does not stand up to the actual conditions of defence preparation in the modern world. We are now to get something like four minutes' warning before annihilation and, even with all the efficiency at Woolwich, I doubt whether we could mobilise the R.O.F. in time to make a significant contribution to a war emergency.
In addition, how does all this square with the running down of the R.O.F.? If it is really needed as a reserve, why is it constantly, and, apparently, without any great plan, running down? Having spent millions on the R.O.F. at Woolwich, it is a tremendous folly not to use it efficiently. It is in the interests of the workers and of the taxpayers that the Government should make a new effort to bring work to the R.O.F.
It is, after all, a general-purpose factory. Its rôle is development and experimental work. It can turn its hand to anything and, in the past, it has shown extraordinary versatility. It has a wonderful record of service. I doubt whether any industrial establishment has such a long and honourable career of service to the nation. It dates back to the days of Charles II, who started using Woolwich as an arsenal. The evidence on this point may not be voluminous, but my judgment is that Charles II would have used the R.O.F. a great deal better than the Government are using it today.
The action which I demand from the Minister is, first, that the pledge that the R.O.F., Woolwich, should be a preferred source of manufacture of conventional
weapons shall be obeyed. This pledge has been given to me by Minister after Minister in recent years. I want to make that pledge effective. Over and over again, I have given examples of contracts for the manufacture of conventional weapons which could have been given to the preferred source—Woolwich Arsenal—going out to private enterprise firms. Recently, I put down a Question about the
percentage of orders from the Military Engineering and Bridge-Building Establishment, Christchurch … placed with Royal Ordnance factories; and what proportion with private firms".
I was given this reply:
Three per cent. of the orders … have been placed with Royal Ordnance factories, and 97 per cent. with private firms. Wherever possible orders are placed with Royal Ordnance factories, but much of the equipment needed … is specialised and not suitable for production in Royal Ordnance factories."—[OFFICIAL REPORT, 26th October, 1960; Vol. 627. c. 279–280.]
My information, however, is that quite the contrary is the truth and that the work is not too specialist for Woolwich Arsenal, that the R.O.F. has done work of this kind many times before and that any general engineering factory equipped as it is could do this job. I note that the jobs were given to aircraft firms to do and not to specialised bridge-building firms. That seems to me to be good proof that they could have been done by R.O.F., Woolwich, had the order been given there.
I will quote one more example. At the moment, the R.O.F. is producing wooden boxes, half of which it is lining with aluminium. The other half of the boxes, however, are laboriously carried in the R.O.F.'s transport all the way to Colchester to a private firm which is already full up with work. Why should not the R.O.F. do the whole job? I cannot see any possible explanation. Finally, all the repairing of the voluminous motor transport and vehicles of the R.O.F. is sent of to Rootes, at Maidstone, when a great proportion of the work could be done in the R.O.F.
The first action I want, therefore, from the Minister is a fulfilment of the pledge that the R.O.F., Woolwich, should be the preferred source of the manufacture of conventional arms and that it should get its fair share of defence orders.
I want the Minister to spend far more time and trouble in trying to bring civil work to the R.O.F. when defence work is not available. It has been very useful in Woolwich, and the Minister himself wrote to me on the 27th August, when he said:
From time to time useful orders, such as that for turbines which was completed not very long ago at Woolwich are obtained; but we clearly cannot expect to obtain work on anything like the scale that was possible in the period following the war when there was several years' accumulation of unsatisfied civil demand.
What does that imply? It implies that we have enough turbines today, that not only Britain, but Africa, Asia and our friends in the under-developed countries have got enough electric power, so that Woolwich, which could produce these turbines, is on waiting time or remains idle.
It is criminal complacency in the modern world to say that a factory which has produced first-class things of this kind in the past must remain on waiting time because there is no demand for its products. It makes no sense at all, and it is wholly inconsistent with the argument that Woolwich must remain idle because it is a reserve for military purposes. The Minister cannot argue both these points, and I ask him which one he is arguing.
The real reason why we do not get these civil orders is that there is no urgency about going out for them and no sales organisation, as well as a prejudice against Government factories in favour of private enterprise factories in this respect.
Therefore, very briefly, I demand that this first-class Government factory should be given the work which it can do, which it wants to do and which it is in the interests of the taxpayer and of the nation, let alone those of my constituents, that it should be doing. It is grossly under-employed, after all the millions of pounds spent upon it and no proper use being made of it. I want the Minister to reassure me on this point, and I hope to have the support of one or two other hon. Members in this plea that I am making.
I want to reinforce the plea made to the Under-Secretary tonight by the hon. Member for Woolwich, East (Mr. Mayhew). One question I want to ask the Minister is whether, tonight or in the almost immediate future, he can do something to dispel the considerable despondency and uncertainty about the future position regarding employment in the Arsenal.
We have heard from the hon. Member for Woolwich, East about the position of people who are now being declared redundant, but there are rumours flying round Woolwich and the immediate area that more people in the immediate future will be thrown out of work. All I want to do briefly, in order to enable other hon. Members to take part in the debate, is to say that it seems to me quite incredible to have this vast modern plant, capable of producing all sorts of items of heavy machinery and heavy equipment, idle, when, in the interests of efficiency it should be kept employed on civilian work. I can see no reason at all why it should not be engaged in civilian work, and, at the same time, stand by in immediate readiness to carry out any other work required in a national emergency.
All I want to ask tonight is that either the Under-Secretary should do something tonight, or his right hon. Friend should announce something in the immediate future, to dispel this despondency and uncertainty which exists at present in my constituency.
I do not want to prevent the Under-Secretary from making a full answer to the questions that have been raised, but, in congratulating my hon. Friend the Member for Woolwich, East (Mr. Mayhew) on bringing this matter up, I should like to reinforce the point he made that many men went on the establishment at Woolwich in the belief that the Government would play fair with them and that they would have security. Many of these men, because they are not getting fair play, are being deprived of their pension, because they preferred to stay at work at Woolwich rather than go to other jobs at more money at that time.
My hon. Friend has raised the question why the Government and the War Department, which can lose over £1 million on two orders for boots, should put off 140 men within sight of Christmas. I ask, as the hon. Member for Woolwich, West (Mr. Turner) has asked, because there is terrific uncertainty and misery at the present time. I hope that when the Under-Secretary of State replies he will at least be able to assure those men who are still in that there will be no sackings this side of Christmas. That, in itself, would be only a fleabite, but it would at least be helpful.
The Minister of Supply said on 7th May, 1957, that this was to be preserved for conventional weapons. That was added to by the Secretary of State's predecessor on 23rd November, 1959, when he reaffirmed that. As the Secretary of State reaffirmed that Royal Ordnance Factories are for conventional weapons, I would ask the Under-Secretary of State to tell us, why on earth they are getting only 3 per cent. of the orders for armaments.
I want to intervene for only a few moments. The hon. Member for Woolwich, East (Mr. Mayhew) mentioned Charles I. Of course, Charles I did have a lot to do with Nottingham, where we also have a Royal Ordnance factory. My hon. Friend knows that last week, in conjunction with other hon. Members, including hon. Friends of mine, I saw him about Royal Ordnance Factories generally and Nottingham in particular, and I should like to emphasise what has been said in this debate, that the uncertainty caused to workers there is something we must do something about. We ought to do something about the uncertainty about redundancy. There is a potential in the Royal Ordnance Factories and the Government ought to do all they can to see that that potential is used to the full to kill the uncertainty among the workers.
I am grateful to the hon. Member for Woolwich, East (Mr. Mayhew) for raising this subject and to other hon. Members opposite and hon. Friends who have taken part in the debate. We were glad to help the hon. Member in the summer in arranging his visit to the Arsenal, and he mentioned then that there were points on which he would require answers, and has since been good enough to indicate to me some others which he has made tonight. I must compress my reply considerably in order to cover all the points even within a generous quarter of an hour which hon. Members have left me, and although I shall not be able to answer everything I hope that I shall be able to give an answer at least to the main issues which have been raised.
The problem of Woolwich today is not just the proper planning of production in the Ordnance Factory with due regard to its efficient use and the interests of those who work there. It extends beyond the factory itself, as the hon. Gentleman knows, to the Royal Arsenal Estate, and the future of that estate. Woolwich, as he reminded us, was historically the military arsenal of the Empire. Now it is one Ordnance factory among a number of others, but it is also a great deal more than that. It survives as a whole complex of industrial and Service interests involving the employment of nearly 8,000 people with all that that means to the community which has grown up round and in the Arsenal and which depends on those who get their livelihood there.
There are, as the hon. Gentleman reminded the House, in Woolwich special skills in the making of munitions which exist nowhere else in the world, rather as Switzerland has special skills in watchmaking and Lancashire has in cotton. The hon. Member knows all this, but I wanted to say that because I want him and his constituents to realise that we, as the Department responsible, do not simply regard Woolwich as a convenient source of military equipment which we happen to have. We recognise the social responsibilities which devolve upon us in view of its long history, and we realise that we shall be judged as a good and responsible employer by how far we succeed in measuring up to those responsibilities.
May I try to deal first with the present redundancy of workpeople at the factory? This, according to my latest information—I am afraid it does not exactly correspond with the hon. Gentleman's—involves 134 men, 69 of whom are skilled and 65 unskilled. The unskilled men are all unestablished and one-third of their number are over 65. Of the skilled men 17 are established employees.
I had to tell hon. Members from Nottingham when I saw them last week that I was afraid there could be no question of cancelling the present redundancy notices. I am afraid that I must say so now in the case of Woolwich.
We did our best to defer any discharges till after the Christmas holidays but, in the event, I am afraid that there are 25 men who fall to be discharged on 2nd December. Twenty of these are skilled men and I am glad to hear from the Woolwich Employment Exchange that it anticipates no difficulty in placing the redundant skilled men. I think that the individuals concerned may well have got to know already that they will be redundant though they may not yet have had formal notice. If they find a new job meanwhile they can of course leave us at any time to take it up. It is fair to say also that I can give no undertaking that there will not be more redundancy in future owing to the diminishing volume of Service requirements for munitions. I said the same thing to my hon. Friends from Nottingham when I met them.
With this in mind, and in view of the uncertainty about the future to which hon. Members have referred, I have looked very carefully at the machinery through which redundancy works to see whether there is proper co-ordination between management and unions. I wished to be sure that the men concerned are treated fairly and with the least possible inconvenience to those who have to lose their jobs and whether the gap in time between prospective redundancy being known at management and union level and the men concerned knowing which of them are to be dismissed could be any further narrowed.
I am advised that in the case to which the hon. Member for Woolwich, East referred there should be no great problem in finding other work, especially for the skilled men, but it clearly is helpful in these cases if as long notice as possible can be given to the men concerned. I want to look into that again.
Before the hon. Gentleman leaves the question of redundancy and the very serious statement that he has made that further redundancy is in the offing, can he assure the House that the total employment at Woolwich Arsenal will not fall below the minimum laid down by the Perrott Committee when it reported?
Off the cuff I cannot give that assurance, but I will look into the point and write to the hon. Member. I do not want what I said about future redundancy to provoke undue alarm and despondency. That would give the wrong emphasis, but I do not want to raise too great expectations of a continuing stable position because that would be unfair and unrealistic in the light of the picture that I have tried to paint.
I now come to the special problem of the factory. Woolwich is one of the weapon and fighting-vehicle group of factories and like all this group and indeed all Ordnance Factories at present it is affected by a reduction in the volume of Service requirements for munitions. We have already closed or are closing four factories engaged in similar work and, as the hon. Member for Woolwich, East noted with approval on his recent visit, we have carried out a considerable concentration of productive capacity at Woolwich itself.
Of the four factories in its group Woolwich is the hardest to run because it has no clear-cut rôle leading to line production which is the most straightforward and economical sort of work. But it can do other things. By this I mean "batch production", experimental and development work and tool work. In other words, the smooth running of the factory now depends on a steady flow of miscellaneous small work requiring specialist attention and this is inevitably the hardest thing of all for management to achieve.
The hon. Member for Woolwich, East saw a lot of empty workshop space and he saw first-class plant standing idle. Granted that one rôle of Ordnance Factories is to provide a reserve of capacity for defence production in time of need, there is bound to be a little of this, but I agree with the hon. Member that we should try, and we are so doing, to keep it to the minimum.
Then the hon. Member says that we have no proper organisation for bringing into the Royal Ordnance Factories orders of a non-defence kind. With respect, this is not quite true. These things, as the hon. Member knows, and as other hon. Members know, are done in industry by knowing industrial conditions and by knowing the right people at the right time; in other words, by contacts. We have inherited the close contacts which the Ministry of Supply had with industry in this field, and they result in orders, but the demand for our facilities is bound to be much smaller now than it was just after the war when there was several years' accumulation of demand overflowing from civilian factories and, naturally, gravitating in our direction.
The obverse of this criticism by the hon. Member is that not all defence orders go to Ordnance Factories, and he would, no doubt, say—indeed, he did say—that too many go to civil industry. Again, I could not accept that. Broadly speaking, we give to Ordnance Factories as much work as we possibly can of the kind that they are suitably equipped to do, subject to the Forces' delivery requirements and the design rights of firms. One exception is where in the case of overseas or Service orders we cannot fit the work in with the required delivery date and have to place the order elsewhere or lose a customer. One must, of course, also remember that as modern armaments become more and more complicated—"sophisticated" is, I think, the current jargon—more and more orders crop up which Ordnance Factories just do not have the capacity to enable them to handle.
The hon. Member raised an important point about our system of costings. He did not make much reference to it this evening, but he gave an indication that he would raise it in his earlier correspondence with my right hon. Friend. The hon. Member complains that we miss civilian orders because with all this plant standing idle our overhead costs inevitably bulk so large in our total costs that we miss orders on price. I know from my own early contacts with the engineering industry that the element of overheads of this kind in total production costs presents a difficult problem. All engineering shops have to take into account what is called an establishment charge, and the more fully employed the shop, the less this charge will need to be in relation to any particular order.
We are aware of the unfairness to our factories which would result if all our overheads had to be borne on production prices, and, as I think the hon. Member has been told, we have a system by which a proportion of the overheads of each factory, calculated to reflect the degree of idle capacity, is excluded from production prices when we quote. In view of the interest in this which the hon. Member has shown and of the complexity of this subject, I will look at it again, but I think the hon. Member will appreciate that it is not an easy matter.
I am very grateful to the hon. Member for his offer. When he looks into the matter, will he bear in mind also the question of casting for a contract? When a Royal Ordnance Factory is tendering for a contract and its price seems a little high, will he bear in mind that all the time the taxpayers are paying out great sums of money in keeping these men and all this plant idle, and perhaps this should be reflected somehow or other in the prices quoted by the Royal Ordnance Factory?
What the hon. Gentleman says is quite true, but as against that, we have the Public Accounts Committee at our backs and it is interested in establishments which are financed by money voted by this House. Therefore, it is not a very easy path that we have to tread. However, as I told the hon. Member, I will look into the point.
I will also undertake to examine our current criteria of what civilian orders we consider our factories are equipped to handle and see whether we are drawing our lines too rigidly, and I will write to the hon. Member when I am ready.
I think it will be clear to the House from what hon. Members have said, and from my reference to the somewhat similar problems at Nottingham, that in the context of changing Service needs the whole future of Ordnance Factories is causing us a great deal of thought and, obviously, my Department would be failing in its duty if it were not now giving this question special study.
It might help if I very briefly tried to indicate the kind of signposts, in addition to what I have already said, which we are taking to guide us in this study.
First of all, we are extremely jealous of the reputation of the War Office as a good and responsible employer of civilian labour, more particularly as we are recruiting more and more civilians ourselves. Secondly, I wish to affirm—the hon. Gentleman asked for this—that what has come to be known as the "preferred source" policy still stands; that is to say, that Royal Ordnance Factories will continue to be the preferred sources for defence orders for the kind of munitions they are equipped to produce.
In this connection, I wish to reject absolutely the hon. Member's charge that there is a deliberate political bias tending to deflect orders from Government establishments into private industry. I do not think there are any politics at all in this, except constituency ones, in which, of course, we respect and sympathise with the concern of hon. Members for their constituents who work in Ordnance Factories.
Finally, I wish to say to the House that my right hon. Friend and his Department, as the employer of those who work in Ordnance Factories, and as responsible for so much productive potential there, must in fairness to the men study the future of all this in the light of the likely developments in demand. An Army of 180,000 men will, clearly, need equipment in much smaller quantities than in the past. It would be wrong if we took steps to freeze the present organisation artificially into a pattern which might turn out unrealistic and unsuited both to national defence requirements and to the needs of the economy as a whole. As in other industries today, we have to be sure that we are responsive to changing circumstances; just as it is also our duty to see that the changes, when they come, and if they come, bear with the minimum of friction and inconvenience on the men and women concerned and on their dependants.