Scotland (Border Development)

– in the House of Commons at 12:00 am on 8th August 1966.

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2.20 a.m.

Photo of Mr David Steel Mr David Steel , Roxburghshire, Selkirkshire and Peeblesshire

The Border region of Scotland is the smallest of the economic regions or sub-regions which are part of the Government's pattern of economic planning. Despite that, I make no apology, even at twenty past two in the morning, for initiating a debate on the development problems of that area, as I believe that this is the first opportunity the House has had specifically to consider them. I hope that the hon. Member for Berwick and East Lothian (Mr. Mackintosh) may get an opportunity to take part, because this region is distinctive in that it is represented by only two Members of Parliament and, despite our party political differences, we try to work together for its benefit.

I shall not repeat what I have said in more general debates about the steady drain of population from this part of Scotland. In recent years, the very growing prosperity of other parts of the country has emphasised this drain, and the need for new male-employing industry has become more apparent. The development district policy pursued under the Local Employment Acts—which in itself had much to commend it—had the side effect of accentuating the problem of depopulation. The development scheme in central Scotland resulted in adding yet one more place to which people from the Borders went to seek work.

The position now is that the Borders, in common with most parts of Scotland, is a development area by the new definition, in that it is eligible as an area for the new investment grants, and the Government have announced in the Scottish Plan their intention to increase the population of what they define as the western Borders, which is my constituency, by 25,000 by 1980, with Galashiels acting as the focal point.

Lately, we have had the welcome news that the first advance factory to come to the Borders is to be sited at Kelso. It is worth mentioning in passing that the choice of Kelso was probably largely influenced by the fact that the burgh is fortunate in having an almost clear housing list, whereas most other burghs in my constituency have serious housing problems of their own. With an up-to-date housing list, Kelso was able to offer housing and go ahead with the programme for incoming workers. The lesson stands clearly before the other burghs that housing is the key to attracting a new industry, and I am glad that there is to be an early start on a scheme for 1,000 new houses in the Galashiels area.

The coming of the advance factory to Kelso re-emphasises the point I have made consistently ever since I came to this House, that the whole area must be open to possible development; that the advantages of being a development area apply not just to the focal point of Galashiels but to the region as a whole, and such local initiative as is general throughout the region may be rewarded by the development of new industries and of existing firms there, instead of, as was so often the case in the past, our finding our firms moving out and setting up branch factories elsewhere. We have also the recent appointment of the Economic Planning Group, under the chairmanship of Mr. Tait, which has started work on advising the Government as to the precise nature of our local problems and the way in which the planning should be implemented.

In passing, while I welcome the composition of this group, and think that it will do valuable work, I would point out that the Government know quite well that it was my view that, rather than having simply an advisory body, I should like to have seen a development authority for the region. The prototype of the Highland Development Board might have been extended as a swifter means of accelerating development in the Borders. Nevertheless, this group, limited though its powers are, will perform useful work. This is the side of the policy which is designed to attract into the region by positive inducements, new forms of employment, which is something I have always advocated.

There are two aspects of the question of combating depopulation. The other is that the infrastructure of the area has to be developed to a point where the region itself becomes attractive to incoming industry. The most important current controversy about development in the Borders centres around the proposal of British Railways to withdraw passenger services from the Edinburgh-Hawick-Carlisle railway line—the last of the Beeching proposals in Scotland to be decided. Since that proposal was first made, two factors have emerged which should alter the decision. One is the proposed development in the Western Borders through which this line is the main artery. The other is the publication of the Government's White Paper on transport a few days ago which recognises the rôle of the railways in economic development and stresses that commercial viability is important but secondary". It is with these factors in mind that I read with some astonishment the statement made in Glasgow last week by the Chairman of the Railways Board, Mr. Raymond, to the effect that there was nothing inconsistent in the closure of the line and the designation of the Borders as a development area and—according to a Press report— what new development districts need is a good road system". I hope that the Minister of State will take the opportunity of saying tonight that Mr. Raymond is not an architect of the Government's regional policies and that decision on the closure of the line will be a Government decision taken only after full consideration of all the economic factors necessary to Border development and only after considering in particular the findings of their own Economic Planning Group.

When I learn that British Railways claim a loss of between £5,000 and £6,000 a year in running this line I am not very surprised. Business has been positively driven off to the roads, especially in the last three years since the Beeching proposal was first published by the failure of British Railways to improve the services offered, and several small stations in places where they are not essential have remained open while they are obviously uneconomic. I recognise that from British Railways' point of view it makes sense to close this Border route and transfer all the Edinburgh-London traffic on to the Carstairs line, thereby increasing the volume of traffic on that line to justify the capital cost of electrification. If we were in the old days when what was good for British Railways was the chief yardstick by which these things were judged that would have to be accepted, but if regional policies are to be meaningful, there can be no justification for retaining the Edinburgh-Carstairs line which serves no substantial community and most of whose stations are closed. It would be far better to make the Borders route the Edinburgh-London-West Coast route. That would be a tremendous shot in the arm for the economic development of the area.

Photo of Mr Michael Noble Mr Michael Noble , Argyll

I thank the hon. Gentleman for giving way. I thought I heard him say that it was British Railways' estimate that this line cost them £5,000 or £6,000 a year. Are these the figures from British Railways today?

Photo of Mr David Steel Mr David Steel , Roxburghshire, Selkirkshire and Peeblesshire

No. These are figures—I do not know quite what date they are—which I am not claiming are recent figures at all. There may be more recent figures that will come out in the course of the public inquiry which is to be held later this year into the closure of the line. I should not be surprised if the figure was now very much an underestimate in view of the lack of development along the line since the Beeching proposal was made.

I cannot expect the Minister of State to comment in detail on the railway question because it is not his responsibility, but I want firmly to make the point that this is a general Government responsi- bility and that, in my view, the withdrawal of passenger services from the line would be totally inconsistent with the development plans for the region as a whole.

Then there is another part of the infrastructure which I want to refer to—the medical services in the region. Peel Hospital was a temporary wooden-hutted hospital which must be due for replacement. I noted that Bangour Hospital, West Lothian, is being replaced because of development at Livingstone, and a new hospital is being created there. That is quite right and logical, but I hope that when the next hospital programme is published a new general hospital for the Borders will be included because that is a vital part of the economic regeneration of the area.

The general hospital services in the area require total overhaul. Several of the cottage hospitals are out of date. Some of them, because of the lack of geriatric facilities, are really converted for practical purposes to geriatric hospitals instead of providing the opportunities which cottage hospitals ought to provide. The cottage hospital at Peebles is so situated that it is flooded whenever the river rises beyond its banks and it has been due for replacement for many years now.

I believe that the opportunity exists in the Borders for the Government to pursue their policy of general health centres and clinics. I know from the talks I have had with people in the medical world in the Border region that this is something they would very much like and want to encourage. But the impression has got around that there is likely to be no immediate move in this direction, and the result has been in one town that general practitioners have already gone ahead and built a surgery of their own, and in another town they are considering so doing unless there are some signs of Government action fairly soon.

I say in passing that I think that the Government and the Scottish Office must initiate action in this matter, because the South-East Regional Hospital Board by its very nature and composition—and I am not for one moment accusing it of bad faith—is very much Edinburgh orientated. With the great medical tradition of Edinburgh, it has swamped anything else within the Board's responsibility. The result is that hospital facilities in the Borders tend to be a bit of a Cinderella in the view of the Regional Hospital Board.

I want to say a word about tourism in the Borders. I am convinced that, of any part of Scotland, the Borders is the one with the greatest undeveloped tourist potential. Individual towns have done their best to sell their particular attractions, but it is my view that we have to sell the Borders as a tourist area in the same way that the Highlands have been sold as a tourist area. No one town in the Highlands, whether Oban, Fort William or Inverness, has stuck out a worldwide claim as a great tourist centre, but the Highlands of Scotland are known throughout the world as a tourist region. The Borders of Scotland are not even known throughout this country as a place of great tourist potential, scenic beauty, fine fishing, historic abbeys, and so on. I would like to see a more positive form of Government help to get the Borders on the map as a major tourist centre in Scotland.

In passing, although, again, this is not a responsibility of the Scottish Office, I must say that the Selective Employment Tax has not been helpful in the development of the tourist industry, or, indeed, the other service industries in the region. I hope that some of the half favourable comments that we have had from the Secretary of State about future variations of the Selective Employment Tax from region to region will be seriously considered in the next Finance Bill. I am sure that I will not be alone in creating a row if they are not. One can accept to a point that this crude instrument has been introduced in a hurry, but I hope that by next year regional variations, particularly the point which I put forward in the debate on the tax concerning concessions in the development areas, will be seriously considered.

No discussion of the problems of the Border would be complete without reference to the agriculture industry. Two points, one of which is permanently with us and the other current, have been put to me most forcibly by farmers in my constituency. The first is that I hope that the Government have a serious intention of introducing a new Agriculture Bill during the present Parliament, not this year, but during whatever tenure of office the Government may have.

I certainly find that among the tenant farmers in my area there is a recognition that while the 1947 Act was too unfavourable to landlords and too biased in the direction of the tenant, the 1958 Act swung too much the other way. There is no doubt that many tenant farmers are finding their rents pushed up time after time because of the present system of arbitration based upon open market rents.

I know of cases in my constituency where a farm on an estate was let to a business man who could afford to pay a high rent; and the rents of all the other farms on the estate immediately went up because that is the economic rent as proved by the letting of the farm to someone who can afford to pay a high rent. This is an iniquitous system which is most unfair to those who depend for their living on the land.

In correspondence with the Scottish Office, I was astonished to learn that the Department attaches great weight to the views of the Scottish Landowners' Federation on this matter. If we wait for the Federation's Agreement, we will probably never get a new Act. Such a new Measure should also include a restoration of a measure of security of tenure from father to son.

The current matter in agriculture to which I refer is the credit squeeze. Unless relief can be granted to farmers, the credit squeeze will have a particularly adverse effect upon agriculture in the sense that it will prevent farmers from borrowing on the basis of their future crops to buy animals in the markets over the next two or three months. Already I have had letters from farmer constituents verifying this. It is bound to have a depressing effect upon the industry. As much as possible, the agriculture industry should be exempted from the severe limitations upon credit.

I believe that the future for the Borders is a very bright one provided that the Government are prepared to pay attention to some of these fundamental matters which will affect the pattern of development.

I have referred before with some pride to the export record of this region per head of population in terms of woollens and tweeds. I have said before that if every region of the country had an export record like ours we should not be in our present balance of payments situation. The potential is great. I do not believe in holding out a begging bowl to the Government on behalf of the Borders. That is not the right approach, but we are entitled to ask that the region be given the same opportunity as other parts of the country to compete and to show that it has a really great future.

2.40 a.m.

Photo of Mr John Mackintosh Mr John Mackintosh , Berwickshire and East Lothian

I am glad to catch your eye on this topic, Mr. Deputy Speaker, not just because Border development affects my own constituency so closely but also because the subject is interesting as a planning problem in its own right. It is the hardest planning problem in Scotland. The depopulation of the eastern Borders has gone on faster than in any other part of Scotland, including the Highlands. The population of Berwickshire, for instance, dropped by 10 per cent. in the last decade, and it is now below regeneration point, the point at which the present population can recreate itself. This is one of the problems that requires most rapid and urgent attention from the Government, and I am glad to say that it has had this.

The second reason why it is extremely important and interesting to discuss the subject is that it is a composite problem affecting many Government Departments, not only the Scottish Office but the Board of Trade, the Ministry of Agriculture, Fisheries and Food, and the Ministry of Transport. The problem crosses the Tweed into Northern England, and it also affects the Lothians, around the Edinburgh area. I see only the right hon. Member for Argyll (Mr. Noble) present to represent the Conservatives tonight. I hope that he and his party have appreciated now that this matter can be handled only by Government activity and Government planning, by the Government and local authorities taking a lead.

I was grateful to the right hon. Member for Kinross and West Perthshire (Sir Alec Douglas-Home), the last Conservative Prime Minister, for coming into my constituency—he is a constituent of mine—to the county town of Duns and telling the assembled multitudes not to worry about depopulation, for it would solve itself within 30 years. That reminds me of Lord Keynes's distinction between the short run and the long run. He said that in the long run we are all dead.

I was also grateful to the right hon. Member for Bexley (Mr. Heath), who underlined this point a month before the 1964 General Election, when he came to Berwick-on-Tweed, surveyed the problems of the whole Border area and said that one thing was clear—that this could never be declared a development area. We had to concentrate on growth points in the North-East of England and Central Scotland, and the area in between could be left to itself.

I was grateful to him for saying that. It reminds me of a remark made only this weekend, that nothing stands between the Conservative Party and power except the Leader of the Opposition. That is a little favourable. I do not think that the Conservative Party's chances of power are quite as hopeful even as that, or as tenuous, whichever way one looks at it. But I hope that it has now been appreciated that the attitude of laissez-faire, that the Government would do nothing for the Borders, meant complete disaster, and may be the chief reason why the two people speaking tonight on behalf of the Borders are both members of other parties than the Conservative Party.

Nevertheless, having made this general point, I think that it is now fair to say that all people in the area, of all parties, are struggling to do their best under the leadership of the present Government with their Border development plan to get some development going, to arrest the depopulation and to reverse the trend. I agree with the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) that at the moment the situation looks bright, that there is a good deal of activity going on. This is largely because of the Government's determination and their decision to declare the entire Borders, indeed the whole of Scotland barring the Edinburgh area, a development area, thus making it possible to get a 40 per cent. grant for plant and machinery in this area when the new Act comes into operation.

There are also all the other points the Chancellor of the Exchequer has insisted upon in his development area policy. He has given special assistance, through the Local Employment Acts, for extra jobs in development areas. The control of office development in the South-East has had its good effect in dispersing office development. I wish that we could get some dispersal within Scotland from Edinburgh into the Border area. The control of industrial development certificates has been a help. There is preferential access to the Public Works Loan Board and, above all, there is exemption for the development areas from the cuts in both the past and the present squeezes.

I hope that these factors are firmly in the Government's mind and will be reinforced by what is said tonight. There are one or two features in the situation which will not, I hope, be allowed to reverse the hopeful trend which we have had in the past two years. First—again, I echo what was said by the hon. Gentleman—there is the tricky position of agriculture at present. I have spoken about agriculture in the Borders already in this Parliament, and I have been a little worried at the somewhat unenthusiastic reception of my remarks on the Government benches. I think that there is still an attitude on this side that farmers are rich men with Jaguars who send their children to fee-paying schools and who, if anything, can be squeezed a bit more than they have been.

What farmers, just as with miners, school teachers or anyone else, do with their money is absolutely their own business. What we have to do is to consider whether the industry as an industry is in a healthy state. I have looked up the statistics of incomes accepted by the Government in the last Price Review. For even the largest farmers in Scotland, net incomes were £2,600, £2,400, £2,500 and £2,500 a year for the four major categories of farm listed; and these figures include not merely income but return on capital of businesses with £150,000 or £180,000 invested in them. If we on this side heard of industrialists who had that return on their capital, we should either say that they were either inefficient or we should be shocked.

In fact, most of the farmers of Scotland are extremely efficient. They certainly are in our area. The simple fact is that they are being squeezed on to very tight margins by the present Government's policy of tight Price Reviews, and the end result is that capital is not being recreated or not being ploughed back. Machinery is not being renewed. Those of us who know the Borders and the farming areas there will understand this point. It is a worrying factor in the area if there is not sufficient capital formation in agriculture.

Photo of Mr Michael Noble Mr Michael Noble , Argyll

How does the hon. Gentleman connect this with his statement a minute or two ago that the whole of the development areas were being isolated from the Government's squeeze policies?

Photo of Mr John Mackintosh Mr John Mackintosh , Berwickshire and East Lothian

This is not part of the squeeze policy. It is part of the Government's policy for agriculture. The point I made earlier was that the development areas have been exempted from the cuts in capital investment. There has never been any question but that the agricultural policy applies throughout the country.

Photo of Mr Michael Noble Mr Michael Noble , Argyll

So does the rest.

Photo of Mr John Mackintosh Mr John Mackintosh , Berwickshire and East Lothian

I have spoken about agriculture and the shortage of capital in the area. I was alarmed to find that this has spread to the inshore fishing fleet as a result of the Government's latest decision to cut subsidies by a rather heavy—and disputed—percentage. I understand from my recent conversations with the Minister that he reckons it to be about 14 or 15 per cent., though it comes to more than that in my calculations.

The inshore fishing fleet, on which also the area depends to a considerable extent, has been badly hit by this decision. I hope that the Government will think about this carefully when considering the amount of capital that they are prepared to put into the area.

Finally, there is the question of transport, which the hon. Member for Roxburgh, Selkirk and Peebles raised. I would not go all the way with him about making such a strong case for the particular Edinburgh/Carlisle line, but I would agree that British Rail is very defensive when it is asked for its figures on these matters. When one asks it to integrate transport decisions with local economic decisions, one is brushed off with the fact that it has gone through the legal formalities, and it is required to do no more. One is entitled to ask it to discuss these matters in the general context of the economic development of the region.

I do not want to raise the matter of the A1 road again. It is a point which we have debated at length in the House. At the moment, the whole Border area has not one first-class road running through it. Neither the A1, the A68 nor the A7 has been fully developed as a modern dual carriageway. The sort of argument that we get again and again is that the traffic over these routes does not merit that development. Of course, if they are bad, slow, unsatisfactory routes, the traffic uses other routes, and that becomes a self-justifying maxim.

We have the same argument from British Rail over the development of a major rail link up the east coast. I do not dispute its major point that this line must be kept open, but I dispute its reluctance to furnish us with sufficient facts about particular station closures which one wants to discuss. I am worried about its policy of closing down particular commuter services in and out of Edinburgh, because parts of the borders must be developed as a commuter area. It is a major way in which population can be brought back to those areas.

On agriculture, fishing and transport, there are question marks over the area which may do a great deal to thwart what otherwise has been a very promising line of development. Two factors have kept the whole thing going. The first is the industrial development policy, and the second is the housing programme of the Government. The two things needed for development are housing and advance factories. There has been a tremendous effort by the Government to push reluctant local authorities into building houses, and I am glad to say that, in large part, it has been a success. I would echo the comment by the hon. Member for Roxburgh, Selkirk and Peebles that one reason why Kelso has an advance factory is that it has built the houses that it needs. It is building more houses, and I hope that it will be an example to other small authorities in the area which want advance factories within their burghs.

The second point is the advance factory. Too many different authorities are concerned at the moment, and I hope that we shall see them all work together. In East Midlothian, which comes on to the Border area, the matter is left to the local planning authority. Within the Berwick-shire-Kelso-Berwick-on-Tweed triangle, it is left to the new organisation, the Eastern Border Development Association, working through the development commissions. In the Galashiels area, it has been taken under the direct wing of the Scottish Office. So we have at least three or four different authorities working on the question of bringing small-scale industry into the area. At the moment, the whole thing has a fair momentum largely because of the tremendous amount of push that individuals are putting behind it in the area, and I would pay tribute to people of all parties on these authorities who are working as hard as they can, with tremendous zeal, to bring these factories, develop the area and arrest depopulation.

I ask the Minister of State to give the House an assurance that the particular demands which the eastern borders have put before the Treasury for three advance factories will be granted, and, secondly, that the next round of factory development which is supposed to take place next year—a set of three advance factories—will be allowed to go ahead. I was disappointed when it was decided to locate two of these factories in Berwick-on-Tweed and one in Kelso. I accept Berwick-upon-Tweed and Kelso as sites for two of the factories but I would rather the third had been in an intermediary position at Duns or Eyemouth or Coldstream.

I was a little worried that the old argument with the Scottish Office about growth points in the Border area and a new town has reappeared in the new talks. The argument was put forward under the last Government that the only thing wanted in the Borders was a new town on the ground that development was not concentrated. We want development spread about and now two of the three new advance factories are in Berwick-upon-Tweed, on the same ground of concentration in one area.

I hope that it is remembered that Labour policy is to try to regenerate the existing small burghs, to use fresh capital and to spread development throughout an area which requires development at a lot of places and not merely in one or two localities. I trust that the second round of advance factories will be more widespread. If it is found hard—and I do not believe that it will—to find tenants for the factories, I hope that the Government will twist the arms of some of their contractors of a large part of their needs—paper and red tape and so forth—to go to some of these factories and utilise them.

I remind the House of the successful experiment when the North of Scotland Hydro-Electric Board said it would not buy from a particular contractor unless he set up a factory in its area. He did so, at Buckie, and it has proved fantastically successful. But it would not have been there but for the action of a powerful Government agency. Similar action would help bring small-scale industries to these advance factories if the Government are otherwise unable to find tenants for them but, judging by what we have seen so far, that is not likely at the moment.

I agree with the hon. Gentleman that if this industrial development we are encouraging, this attempt to get light industry into the Borders, does not have sufficient momentum to overcome the difficulties I have mentioned, we must use other weapons available. One of these is the Selective Employment Tax. I welcome the assurance given by the Chancellor of the Exchequer and other Treasury Ministers that, when the next Finance Bill comes in, if there is any sign of faltering in the regional policy of the Government, which has proved so successful, the tax can be used to stimulate and encourage development in these areas.

But, in case that situation arises, I hope the Government will collect not only regional statistics but sub-regional statistics so that we shall know what we are doing and have accurate figures to work on and will use Government initiative and planning to get this whole area into a much more satisfactory condition.

2.58 a.m.

Photo of Mr Eustace Willis Mr Eustace Willis , Edinburgh East

I congratulate the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) on having managed to get so high up in the list of debates, even though the subject has not come up until this hour. He has raised a subject which has given us a great deal of thought since we took office.

The Border area has its own peculiar problems. In the Scottish Economic Plan we put forward proposals that try to tackle those problems and since then we have been taking the initial steps in trying to carry them through. So far, there has been a general welcome for the Government's proposals in the Western area.

There has been a general welcome for the proposals to promote a large expansion in the Galashiels and St. Boswells area. At the meeting of the Borders Consultative Group it has been clear that the various burghs are prepared to sink their traditional rivalries and work together to exploit the widening opportunities in the Borders which the new project will create. In other words, there is a general recognition that the development of a real regional centre of population and employment in the Borders will benefit the area much more than a distribution of the same industry and population could possibly do.

I should like to assure the hon. Gentleman that the centre of Government effort and investment in the Galashiels and St. Boswells area does not mean that development will be discouraged in other towns. The situation is that all the main communities in the western borders now have a very unbalanced population structure and that their populations are actually declining. It is of the greatest importance, if they are to attract new industry and allow existing industries to expand, that they increase their housing programmes and show a much greater readiness than they appear to have done in the past to make houses available to young people, to potential migrants and to incoming workers. Many Border towns now recognise that they must allow young people and incoming workers to obtain houses if they are to survive.

For their part the Government are also recognising this need in a practical fashion by allocating Scottish Special Housing Association houses in support of industry, for example at Peebles, Kelso and Galashiels, not to mention the major extension itself. Here the first thousand houses will be provided entirely by the S.S.H.A. It is also important that the Border burghs be urged to accept new population, from whatever quarter.

In this connection there has probably been, in the past, an under-estimate of the value of overspill. This is perhaps because it is a facility that has to be worked for. Glaswegians tend not to go to the Borders of their own accord but as a result of the careful co-ordination of endeavour by industry, local authorities and Glasgow Corporation. Given this, they will come, as recent experience in Hawick and, on a smaller scale, in Peebles, has shown. All this means that industry and local authorities must become more fully aware of the widening expansionist opportunities which the Government's effort is creating in the Borders.

We look particularly to the Consultative Group to help sharpen this awareness and to make those in the Borders fully appreciate the implications of the new development area status that they will shortly enjoy. Naturally, the development of these plans in the western area of the Borders also requires the development of an adequate infrastructure, including an adequate and efficient railway system. Here again, I should like to say something about the Waverley line. After postponement it is now expected that British Railways will advertise the proposed closure of passenger services on this line on 17th August. At its last meeting in Hawick the Consultative Group left us in no doubt whatever that it was strongly opposed to this closure.

The line is an extremely severe loser. I have had a figure mentioned to me, but I do not want to give it without checking. It is very much more than the hon. Gentleman suggests—it is nearer the £100,000 mark than the £6,000 or £7,000. It is a very heavy loser and the Government must be satisfied, before deciding to maintain it, that it is really necessary on social or economic grounds, or both. It will be the business of the Transport Users' Consultative Committee to ascertain hardship and later it will be the responsibility of the Scottish Economic Planning Council, assisted by the T.U.C.C., to assess the economic significance of the line and the hardship there may be to the area which it is proposed should be developed.

Meanwhile, the consultations with, and the guidance of, Professor Marshall should result in the drawing up of a plan for development of the western area, and this should show us the pattern of development in the future and the kind of transport network which will be required. This will enable us to understand more clearly the value of this route to the Borders and, on the basis of these findings, it is the Government's intention to see that the Border areas get the transport system which is needed. Development of health and other services will, of course, also be planned to fit in with the growing needs of the area.

The hon. Gentleman spoke also of tourism and emphasised how much he would like to see this developed, but in the Report in the Scottish Plan on the Borders, he will see on page 99, that in paragraphs 31 to 34, it is pointed out that tourism is not a major industry. It is not thought that the position will change, and reasons are given for this. In other words, the review of the Borders did not hold out great prospect of a rapid or large expansion in tourism. Of course, if it can be developed, well and good, and we should not fail to encourage it in any way we can. But I would remind the hon. Member of the advice which we have received on this.

Photo of Mr David Steel Mr David Steel , Roxburghshire, Selkirkshire and Peeblesshire

It is important that we get this quite clear. I do not dissent from the views of the study group as to the existing situation, but I said that I believed that this area was capable of considerable development, and no attempt has been properly made to develop it as a major tourist centre. It can be given encouragement, but there should be an actual determination that this should be part of the plans for the development of the region.

Photo of Mr Eustace Willis Mr Eustace Willis , Edinburgh East

While we should like to see tourism develop, I can only say what was the finding of the group which studied this topic in great detail.

The hon. Gentleman also raised questions about agriculture and in particular the 1958 Act. He spoke of tenant farmers, but that is a subject for consultation between the Department of Agriculture and the Scottish N.F.U. and the Scottish Landowners' Federation. Whether he likes it or not, we have to consult the landowners. [AN HON. MEMBER: "Shame."] We have tried to find a solution to some of the problems the hon. Member has mentioned, but so far as agriculture is concerned, it is a matter for consultation between all the bodies interested.

I would like now to turn to the eastern area, dealt with by the hon. Member for East Lothian (Mr. Mackintosh). The programme of social development envisaged by the new Development Committee is getting under way. The Committee met recently to discuss, for example, the location of the first of the advance factories for which it is making application to the Development Commission. It has now made application for two factories, each of 10,000 square feet to be sited at Berwick and Kelso. My hon. Friend asked me to give a definite assurance that these applications would be approved——

Photo of Mr John Mackintosh Mr John Mackintosh , Berwickshire and East Lothian

Is not my hon. Friend mistaken? Were not three applied for—two at Berwick-on-Tweed and one at Kelso? That is my information.

Photo of Mr Eustace Willis Mr Eustace Willis , Edinburgh East

My information is that there were applications for two factories, each of 10,000 square feet, at Berwick and Kelso.

My hon. Friend asked me to give a guarantee that these applications would be approved by the Treasury. He will appreciate that I cannot give a categorical assurance that the Treasury will approve an application; it would not be proper for me to do so, otherwise there would be no point in an application being made. It would have been easy for the Development sub-committee of the Eastern Borders Development Association to argue that each small community in Berwickshire or North Northumberland should have a share in the industrial space that might be going, but, as our border study suggested, Berwick-on-Tweed is the real centre of the eastern area, and if it is to continue as a viable service centre its population structure must be enforced, which, in turn, means increasing the variety of employment available.

Equally, as a focus of the area Berwick could work for the eastern borders as a whole in a way that employment spread over many different towns could not. People nowadays look to a variety of choice in employment, and this would be difficult to get with smaller factories spread over a much larger area.

Likewise Kelso, lying half-way between the eastern and western borders is also a focal point, where employment can help to maintain the town's active role. Both Berwick-on-Tweed and Kelso are ready to implement proposals for a considerable increase in their housing programmes. Both Berwick-on-Tweed and Kelso will require a substantial increase of population if their demographic imbalance is to be put right. But there must be priorities, and they must lie in the west.

Meanwhile, the programme invisaged by the Development Commission can provide a useful start in the eastern area. If successful in the early stages there is no reason why it should not be substantially expanded in time to enable the eastern area to achieve stability.

My hon. Friend the Member for Berwick and East Lothian also mentioned questions involving the wide field of agriculture policy. The National Plan contains a programme of selective expansion for agriculture. We are passing a rather important agriculture Bill through Committee upstairs at present.

My hon. Friend also mentioned the question of fishing, and the reduction in the subsidies to the inshore fleets. I do not wish to embark on a long discourse about fishing; the fact is that the inshore fishing fleet is under an obligation to become viable, even if the time limit fixed for this is not 10 years, as in the case of the middle and distant water fleets. If reductions have to be made in the subsidies they should be made at a time when the inshore fleets are enjoying a good year's fishing. This is what has been happening, and that is why the reductions were made.

My hon. Friend also referred to the question of the A1. Work is proceeding on various sections of this road to improve it. We must use the limited funds available where there is the heaviest volume of traffic. That means that we must get on with the A74 and the other main roads with heavy industrial traffic. We do recognise the importance of the A1, however: work on it will continue until it can meet the needs of the area. I have mentioned the Government's commitment in the western area, and the development area status for the whole Border area will create new opportunities.

There remains the problem of small businesses and industries. It is often difficult for small businesses adjusted to a static or even a declining situation to adjust quickly to new opportunities. This is where two institutions under the umbrella of the Development Commission can be of value—the Scottish Country Industries Development Trust and the Rural Industries Loan Fund. The former is financed from the Development Fund and provides advice to small businesses in country areas on management, accountancy, new techniques, marketing and so on. It is strengthening and re-organising services in the development and expansion of small industries, which can be of great value in an area like the Borders. We hope that, through the consultative group, everyone in the Borders able to make use of the Trust will do so. Meanwhile, any small business with a problem should get in touch with the Trust's local officer, Mr. Clarkson of Melrose, who can put them in touch with the appropriate advisers from headquarters.

Another of the Trust's services of particular importance is its advice in making application to the Board of Trade Advisory Committee. Development area status will bring new facilities to the Borders with which people will not be familiar and the Trust can do much to help the Borders get the best of what is offered.

The Rural Industries Loan Fund makes money available for the small industries and is the instrument by which the Development Commission can make money available in, for example, providing or altering buildings, buying equipment or doing capital work. There will be a wide spectrum of assistance for the Borders, ranging from the major expansion expected to increase the population of the western area by 25,000 over the next 10 to 15 years to precise and detailed assistance for small businesses.

Nor is the social side of life forgotten. It is the concern of the Development Commission that its industrial development in the eastern area should be matched by a development of social facilities—not just in social services in the ordinary sense, but in helping to maintain an adequate quality of life in a changing countryside. It has considered this matter and hopes to establish the appropriate machinery shortly.

I have tried to show what is being done in the Borders. I think that I have answered most of the detailed points, and I hope that I have convinced the hon. Gentleman that we are taking the problems of the Borders seriously. We are trying to deal with them expeditiously and in the right way.

3.20 a.m.

Photo of Mr Michael Noble Mr Michael Noble , Argyll

As I listened with my usual pleasure to the hon. Member for Berwick and East Lothian (Mr. Mackintosh) making one of his pre-election speeches I could not help wondering where he had been in the last two weeks, because the tremedous write-up with which he started his speech bore no relation at all to what has happened more recently. It is quite unbelievable that anyone who has been in the House should still repeat the extraordinary statement that the Government's cuts made in recent months do not affect the development areas, because all that has not been cut, as far as I can make out, is housing, education and hospitals, and they have not been cut in any part of the country, so that his decision is not special to the development areas. There is the possibility that if someone wanted to build a lot of big offices in the Borders he would not positively be prevented from doing so, but to believe that that is likely to happen in the next few months is cloud-cuckoo-land in the extreme.

Photo of Mr John Mackintosh Mr John Mackintosh , Berwickshire and East Lothian

The six forms of industrial assistance given by this Government to the development areas all remain intact, as the right hon. Member well knows.

Photo of Mr Michael Noble Mr Michael Noble , Argyll

The hon. Member did not list any industrial assistance beyond the fact that there are certain industrial incentives and that the Border country has been lucky in getting such incentives which it did not have before. But quite a large share of the extra £1,000 million which has to be found by the country to pay for Socialist mismanagement comes from the Border country.

The problem is very difficult. The hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel) was right in his approach to an analysis of the various problems which have affected and are still affecting the Borders—and, for everything that the Minister of State said, are likely to go on affecting them, because we had nothing but his usual delightful and enlightened waffle.

The most important problem is that of infrastructure. We were told nothing about the railways problem. I agree with the Minister's view about the cost of this railway, because the figures which I was given a few years ago were very different from those quoted by the hon. Member. What the Government have not done—and all the planning was prepared for them in Scottish Office before they came to power—is to make any decisions at all about either railwya or roads. Nothing the Minister of State said in any way contradicted that statement. They produced a scheme for the Borders which gave a possible new town in Galashiels but it was left sitting in the air with no method of getting there either by road or by rail. This is typical Socialist planning. The hon. Member for Berwick and East Lothian made some comments on my right hon. Friend. In the same Socialist Plan there is a hope that something may be done for the Solway area in 1990—and this is in a carefully prepared White Paper—and if that is not as long-term as anything my right hon. Friend did, I do not know what is.

Another problem which affects many areas—certainly the Highlands—is lack of medical services. I agree with the hon. Member for Roxburgh, Selkirk and Peebles that we cannot get people to stop in those areas, and the position has been particularly difficult in the Borders where there has not been enough male employment. We shall not keep them there unless there are adequate medical services and adequate roads—and television. I do not know whether hon. Members who have spoken live in such areas, but there are areas in which people can hear only Radio Caroline—which the Government are trying to shut down—because the B.B.C. services do not reach them. There is bound to be discontent until the people living in these areas are provided with the same amenities of life as exist in other parts of the country. The Government have not yet realised this problem, as is obvious to anyone who examines their so-called plans.

I understand why the hon. Member for Berwick and East Lothian gets an un-enthusiastic reception from the Government Front Bench when he speaks about agriculture. The hon. Gentleman speaks with farmers and studies their problems, which are alien to his right hon. Friends. If we are to get a reasonable return from farming, forestry and the fishing industry, enough money must be given to those who man these industries. Only in this way can they employ people and have thriving enterprises.

The hon. Member for Roxburgh Selkirk and Peebles said that more should be done for the tenants. Just before coming into the Chamber I was reading an analysis of this problem in a document in the Library. After dealing with the problems of tenants and landlords, it concluded that a good tenant got a return of 30 per cent. on the capital he employed while a landlord was lucky if he got 2 per cent. The hon. Member for Roxburgh, Selkirk and Peebles seemed to be arguing that one must penalise the landlord and give more to the tenant. I disagree. The answer is to make the rewards for working on the land sufficient to enable the tenant to pay a fair rent, so enabling the landlord to keep the farm buildings in good order.

The hon. Member for Berwick and East Lothian spoke of the Government's housing programme, but I dare not start on that subject. The hon. Gentleman was setting off into cloud cuckoo land, and I will leave it at that. This has been an interesting debate, because many problems have been raised. They were raised with me often enough when I was in office. Unfortunately, the Minister merely answered via his Scottish Office brief—something which I tried to suppress; I admit, not always successfully—and did not produce one concrete plan. He just left us with his assurance that everything was being studied.