Orders of the Day — Development Areas

Part of the debate – in the House of Commons at 12:00 am on 2nd August 1966.

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Photo of Mr Hector Monro Mr Hector Monro , Dumfriesshire 12:00 am, 2nd August 1966

That is a matter of opinion. If the Minister of State were to stand for an agricultural constituency, he would be out on his neck.

It is very much more important to maintain growth points and the development districts, because there is now far less incentive for industry to come to remoter areas which do not have very much to offer in the way of amenities. When firms can go to the North of England, or to the South-West, or to Wales, it will be much more difficult to bring firms to areas like Sanquhar and Kirkconnel development district, where the unemployment rate is 10 per cent.

I should like to hear about the money which is to be made available to the nationalised industries following the Prime Minister's statement. I am think- ing particularly of the United Kingdom Atomic Energy Authority. Will there be any hold-up in the development of the fast reactor at Dounreay? Will there be any development for the long-required development at Chaplecross? Will there be any hold-up in the plans for the Sol-way barrage? I have been getting answers to Questions which have caused me to believe that this will be delayed further and further. Will the South of Scotland Electricity Board carry on with its second power station at Hunterston? We want to know that there will be no hold-up in Scotland because of the measures announced by the Prime Minister.

We know only too well that because of the Guillotine there has been singularly little time to discuss the effects of the Selective Employment Tax on Scotland, but they will be extremely serious. Figures have been produced to show that there is a preponderance of service industries in the North, the Highlands, the North-East, the Borders and the South-West. The employment advantage of the Selective Employment Tax will be very much the creation of new jobs at Cumbernauld for those who are to administer the scheme.

According to an Answer to a Question of mine in May, in Dumfries-shire there are 29,700 people employed and premiums will be received in respect of only 7,300, while 5,000 will get repayment after a loan to the Government, and no fewer than 15,300, or more than 50 per cent., will attract the tax. This is the tremendously deflationary effect on one county and I am sure that it is similar to the effect on all the other Scottish rural counties. The Secretary of State and the Cabinet should urgently consider the effect of this tax.

At the same time, most of Scotland is being hammered by the new local authority rates with new valuations up 35 per cent. on average and expenditure up by about 15 per cent. How can we attract new industry to Scotland when it will have to face rates of that kind? Nothing in the Local Government (Scotland) Bill, now before the House, will reassure industry. The Bank Rate is up, and the cost of overdrafts is up by 9 per cent. adding £700,000 to the farmers' bills so that money will be denied to farmers for essential purposes because they will not be able to pay such a rate of interest. Suppliers and merchants will be hit by the Selective Employment Tax and we all know that there is still no farm improvement grant from the present Government. The Minister of Agriculture is as blind as the Secretary of State for Scotland about the economic plight of agriculture.

We know that this is a crisis of confidence and of the Prime Minister's failure to convince the world that he means what he says and to take action at the earliest moment. We know that the National Plan is in ruins. How can we get expansion of the service industries, particularly in the North-East, the Borders, the Highlands and the South-West, when we have this new tax? The loans to hotels are entirely bogus and will not help the small rural hotel. As we know, petrol is vital to Scotland and this will add £5½ million to Scotland's share of the petrol tax.

I heard of one transport firm in the Highlands which will have to pay £4,900 a year extra in petrol tax and S.E.T. If this is not penal to a small firm, I wonder what is. It is no use the Secretary of State sheltering behind the Highland Development Board, the regional economic groups, and the National Plan, because they no longer make sense. If 2 per cent. unemployed is acceptable to the Prime Minister, it is not acceptable to Scotland. We well know that a 2 per cent. unemployment rate in England is very likely to mean 5 per cent. in Scotland. This is far beyond the 3·6 per cent. mentioned by the Prime Minister before the election as being intolerable.

It is not too late for the Secretary of State for Scotland to redeem his reputation in Scotland. He should stand up and join Conservative Members in fighting for the country he should represent.