North-East Scotland (Selective Employment Tax)

Oral Answers to Questions — Scotland – in the House of Commons at 12:00 am on 9th November 1966.

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Photo of Mr Bill Baker Mr Bill Baker , Banffshire 12:00 am, 9th November 1966

asked the Secretary of State for Scotland if he is yet in a position to assess the effects of the Selective Employment Tax and the credit squeeze on all aspects of industry in the North-East of Scotland; and if he will make a statement.

Photo of Mr Patrick Wolrige-Gordon Mr Patrick Wolrige-Gordon , Aberdeenshire East

asked the Secretary of State for Scotland what has been the effect of the Selective Employment Tax on the Highlands and on the North-East of Scotland.

Photo of Mr William Ross Mr William Ross , Kilmarnock

It is too early yet to assess in any detail the effect of the July measures and the Selective Employment Tax on the Scottish economy as a whole or on any particular part of Scotland. The Government are, however, keeping the position under close review.

Photo of Mr Bill Baker Mr Bill Baker , Banffshire

Would the right hon. Gentleman ally the North-East of Scotland with the reported statement of his noble Friend the Joint Under-Secretary of State for Scotland; that, if necessary, action will be taken to safeguard the Highlands against the effects of S.E.T.? Does this indicate a change in Government policy?

Photo of Mr William Ross Mr William Ross , Kilmarnock

No change in Government policy was indicated in that statement. We have always said that we would keep a close watch on this matter. The hon. Gentleman will appreciate, of course, that the latest figures for Aberdeen, which many people thought would be very badly and immediately hit by S.E.T., show that the unemployment situation is better now than at this time last year.

Photo of Mr Patrick Wolrige-Gordon Mr Patrick Wolrige-Gordon , Aberdeenshire East

May I assist the right hon. Gentleman in his failure to make estimates by telling him that the effects of S.E.T. have been disastrous on these areas because the service industries represent the main proportion of the provision of employment in these areas?

Photo of Mr William Ross Mr William Ross , Kilmarnock

Let us measure the extent of the disaster as we know it. The unemployment percentage for the North-East and Aberdeen last year was 2·6. This year it is 2·8 per cent. I do not think that those figures justify the remarks of the hon. Gentleman.

Photo of Donald Dewar Donald Dewar , Aberdeen South

While accepting what my right hon. Friend says about estimating the effects, would he not accept that what can easily be estimated is the fact that this tax bears more heavily on the North-East of Scotland than on any other part of the rest of the country? Will he therefore give an assurance that he will watch this matter very carefully indeed?

Photo of Mr William Ross Mr William Ross , Kilmarnock

I accept my hon. Friend's remarks. The assurance for which he asks has already been given.

Photo of Mr Gordon Campbell Mr Gordon Campbell , Moray and Nairnshire

Does the right hon. Gentleman still think that S.E.T. is good for Scotland?

Photo of Mr William Ross Mr William Ross , Kilmarnock

In that S.E.T. as a whole was related to the nation and gave an advantage to manufacturing industry, and in that S.E.T. will help us in Scotland to get more manufacturing industry, the answer is "Yes, Sir."

Photo of Mr Jo Grimond Mr Jo Grimond , Orkney and Shetland

Is not the Secretary of State's original Answer a prime example of Government inaction? Does the right hon. Gentleman really believe that S.E.T. will bring industry to the Highlands and the North-East of Scotland? If so, will he examine the facts, one of them being that unemployment in these areas has been consistently—[Interruption.]

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

Order. We must have questions at Question Time, even from the leader of a party.

Photo of Mr Jo Grimond Mr Jo Grimond , Orkney and Shetland

Is the right hon. Gentleman aware that unemployment in these areas has been consistently higher than the Government's targets for these areas, and is this not a strong case for varying the credit squeeze and removing it from these areas?

Photo of Mr William Ross Mr William Ross , Kilmarnock

I can think of nothing better than to tell the right hon. Gentleman that for the first time we have an instrument in the Highlands directly and specifically designed to bring industry in, and that will receive the full support of the Government.