Cotton Textile Industry

Part of the debate – in the House of Commons at 12:00 am on 20th March 1967.

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Photo of Sir Ian Percival Sir Ian Percival , Southport 12:00 am, 20th March 1967

It is fortunate for Lancashire and for the House that there are in the House many Members who have a lifetime of experience in the Lancashire textile industry, who know and understand it, and who care about it. The House has just listened with respect to one such Member, the hon. Member for Oldham, East (Mr. Mapp). We have respect for the hon. Gentleman's knowledge of the industry, for his concern about it, and for the courage with which he has not hesitated to criticise his own Government during recent months when he thought it necessary to do so in the interest of the industry.

I do not have such detailed or technical knowledge or experience, and do not claim it. Accordingly, I shall confine myself to the general rather than to the particular and technical. I shall do my best to adhere to the guidance which you, Mr. Speaker, have just given. The difficulty is not to know what to say, but to know what to leave out, because there is so much to be said about the industry. The difficulty about these long waits is that every half an hour one returns to the Library and adds another two hours to one's notes.

My first point, which I want to make as forcibly as I can following the hon. Gentleman, is that Lancashire is not begging for favours. Some people seem to think that civilisation ends at Watford and that we in Lancashire are a lot of Victorian fuddy-duddies who are living in the past and simply crying for help. They should come and look for themselves, if that is what they think. Of course, we are not all perfect. As the hon. Gentleman said, we have our weaknesses, but the rest of the country could learn something from Lancashire and not least in the matter of willingness to change and in the matter of industrial relations in a rapidly changing economy.

There are two basic considerations which form the background to this debate. The first is that the textile industry is still a great industry which has a contribution to make to the economy of this nation. The second is that, taken as a whole, the industry has fought, is fighting and will fight with vigour against difficulties, the like of which no other manufacturing industry in this country has ever seen—or could even imagine.

If any support were needed for the first proposition, it is to be found in one of the rare accurate statements in the great speech made by the right hon. Gentleman who is now Foreign Secretary, in Manchester on 19th July, 1963, when he said: We still believe that the British cotton industry has an important contribution to make to the national economy". Of course it has. It is unnecessary to take time in discussing that. I can here observe your injunction with ease, Mr. Speaker. It is sufficient to say, and it is no exaggeration to say, that ours is an industry which is vital to the nation, both in peace and in war.

As to the second proposition, if anyone doubts the difficulties, let him read any one of the debates in the House over the last 10 years. If anyone doubts the efforts made by the industry, let him look at the brief summary in an article written by Sir Frank Rostron, published in The Times on 10th March; or, better still, let him come to Lancashire and look for himself. We will show him, just as we will show the world, if everybody, including the Government, will just stop knocking us.

Since 1958, output has risen on average by 30 per cent. per head. This House and the nation should pay tribute to all concerned who have achieved that result. I am very happy to pay my tribute to the part played by the unions and operatives in achieving it. It could not have been done without their co-operation and readiness to accept change. Equally—and this is one of the nice things about the industry—the unions and operatives would, I know, pay tribute to the management, which has been prepared to lay out money and discuss these changes with the unions. The change which is going on is very expensive indeed.

As the hon. Member for Oldham, East said, we are not without our black sheep. There were some in the past who would not spend money on re-equipping. But it is not those about whom we are concerned. Most of those have been driven out. If there are any left, they will soon be driven out. What we are deeply concerned about is the fact that it is the highly efficient, modernised mill which is now being driven out.

We are not begging. We are not asking for favours. The industry is doing, and it is ready and willing to continue to do, its share. All that we want is for the Government to honour their pledges, to give us a fair crack of the whip, to wake up to the opportunities of the moment, and to wake up to the fact that if the industry is not given the chance to seize its opportunities, as it wants to do, permanent damage will be done to the industry to the loss of the nation.

There are those who think that the country owes Lancashire a special debt. In a debate in the House, one speaker put it thus: I have always believed that there is one special reason why we should care about the troubles of Lancashire, and that is the exceptional sacrifice that the Lancashire cotton industry made, both in wartime to release labour for the war effort, and in the years after the war when the industry was rapidly expanding, and, incidentally, taking on a large number of displaced persons from abroad to get immediate exports. At those moments, the country was in need and Lancashire loyally came to its assistance. We should not forget that today."—[OFFICIAL REPORT, 30th June, 1958: Vol. 590, c. 986.] I hope that the President of the Board of Trade recognises those words, because they were his. We do not dissent from those views. We shall be happy to see the right hon. Gentleman embrace the opportunity he now has to give effect to the noble sentiments he then expressed so freely. But our case is not based on sympathy.

Nor are we alarmist or exaggerating our difficulties. On 28th June, 1962, the right hon. Member for Sowerby (Mr. Houghton) said: The cotton industry is not walking about with a chip upon its shoulder, as I have seen suggested. It has been caught up in the march of history. Realising that, the Government accepted a special responsibility for the future of the industry, and if they go back on that now there will be great indignation."—[OFFICIAL REPORT, 28th June, 1962; Vol. 661, c. 1376.] The right hon. Gentleman was speaking of my Government. But how prophetic of today his words have proved to be!

The Labour Government accepted a special responsibility for the industry, and the industry feels very strongly that they have gone back on it. Let there be no doubt that there is great indignation in all sections of the industry, and in all parts—among management, men and unions alike. If anyone doubts that let him get from someone who was present an account of the meeting of delegates of the unions at Manchester at the end of February. I am credibly informed that it was only because of the respect held for the hon. Member for Oldham, East that he was able to placate some of the fury with his references to the Government's intention to set up a commission. We can only guess from what he has said his, and their disappointment, at what has transpired.

The indignation felt in all parts of the industry is directed at the Government, because the Government have failed in two ways to discharge the responsibility they accepted. First, they have failed to implement what they said they would do. Secondly, during the past seven or eight months they have delivered the industry a series of kicks in the teeth, to which I shall refer later.

In the result, the Government have produced an acute, a grave, crisis of confidence, the importance of which cannot be over-estimated. Whatever else Ministers on the Front Bench may feel tonight, I beg them not to underestimate it. It was expressed in very moderate terms in Tattersall's Trade Review for last month, in these words: Few recent periods in the industry have witnessed such a sustained lack of confidence as in the opening weeks of the current year. Since then the position has got much worse, and my postbag contains much more lurid descriptions. I venture to think that hon. Members on both sides have had similar experience.

That is disastrous, because the Government's main job is to engender confidence, and that is what we look for from them. We shall do the rest. Instead of doing that, they have destroyed confidence, and destroyed it at a vital stage in the reorganisation and re-equipment of the industry.

Now the industry is asking itself three questions. Do the Government and the Board of Trade really understand our problem? Do they really care about them? And even if the answer to both those questions is "Yes", are they either competent or willing to do anything about them? We doubt whether they understand, because we find it difficult to believe that anyone who does understand the problems could do what has been done. For the same reason, we find it difficult to believe that the Government care. We doubt their competence and willingness for a number of reasons.

I know that many back benchers opposite do understand and care. Our concern, however, is whether the Government and the Board of Trade care. Do they understand the fundamental changes that are taking place? Do they understand that we are engaged in something much bigger than a mere contraction to a viable size? Are they aware of the technological advances—break-through would not be an exaggeration, in many cases—which have taken place over the last five years or so, and which are completely changing the face of the industry? Do they realise how rapidly it is changing to a capital intensive from a labour-intensive industry?

Do the Government understand what an upheaval all this entails for the operatives and what an expenditure it entails for the managements? Do they realise how far the industry has got along that road? Do they realise how important it is to the country that the transition should be completed and completed quickly? Do they understand that it is the one chance for the industry to make itself more competitive? Do they appreciate that it is some of the people who are taking the lead in that most important transition—with some of the most modern and recently equipped mills—who are now being driven out of the industry?

There is nothing in recent events to give us any confidence that either the Board of Trade or the Government do understand these facts. And further, do they understand that while such restriction on imports as there is achieves some purpose, it does not guarantee to the home producer any given quantity or even any fixed proportion of the home market? The way it works in practice is that the importers are guaranteed their quotas and the home producers are simply left with the balance of demand, whatever it may be, with the result that, when the total demand falls, it is always the home producers who "carry the can".

We are tired of being told that these quotas are adequate protection. Surely we have learnt by experience that, while they give very good protection to importers, they are not nearly so good for us.

The hon. Member for Oldham, East referred to the loopholes in the existing arrangements. Do the Government even yet not realise the immense disruptive effect of a flood of low-cost imports coming in over a short period? It might not be quite so bad if they were even spread over the year. Do the Government realise that every one of these floods coming in over a short period drives people out of business? They cannot keep going in face of such floods. The operatives will not stay in an industry where they are always subject to being put on short time; and it is the best ones who tend to leave because they feel that there is not much of a future and not much reason for staying in the industry. The better and more expensively equipped the mill may be, the less it can afford to stay open unless it is actually working all the time. Do the Government not realise that, every time one of these mills closes, it is a permanent loss to the industry and to the productive capacity of the country making us even more dependent on imports in the future?

Those are just a few of the questions which spring to mind and prompt us to doubt whether the Government understand our problems. We doubt it, and that is one of the major reasons for the dramatic loss of confidence over the past seven or eight months.

Recently, we had a visit from the Minister of State to Manchester. I must tell him that my information is that it did little, if anything, to allay the doubts or fears. Further, last week, we had a statement from the President of the Board of Trade, and I must tell him frankly that large sections of the industry are, at any rate as yet, not persuaded that that was anything more than a lot of hot air.

However, the cause of our doubts goes much deeper than those two single instances. It springs from a comparison of the words and deeds of the Government over a period of years, and I want to take up a little time in looking at them—[HON. MEMBERS: "Oh."] I hope that no one in the House under-estimates the importance of this subject and thinks that it is something which should be treated lightly or rushed through.

There are still those in the House who will recall the little maestro's "Plan for Cotton". We were lectured on it frequently, and told that it would solve all the problems; as soon as Labour returned to power, it would swing into action with this plan. The theme was repeated over and over. Powerful speeches were made in support of it by some of the right hon. Gentleman's colleagues who are now in his Cabinet.

May I just refer to two of them? In the debate on 28th June, 1962 the right hon. Lady who is now Minister of Transport, and whom I am happy to see on the Government Front Bench tonight, had this to say: It is crying for the moon for us to say to Lancashire. 'Reorganise your structure by 'verticalisation'. Emergency action is needed, and the emergency action that I call for is for the Government without delay to set up a Government-sponsored import commission with the duty of supervising all the import trading in cotton textiles. It will then release those controlled imports, including generous levels of imports from the Asian countries, on to the home market at prices which take account of the needs and the costs of production both at home and of our imported textiles, and at prices which do not have a disruptive effect on the industry." —[OFFICIAL REPORT, 28th June, 1962; Vol. 661, c. 1466.] On 1st July, 1963, the right hon. Gentleman who is now Minister of Housing and Local Government said: The fourth necessity, I am certain, is for the kind of cotton import commission which my right hon. Friend the Leader of the Opposition suggested in the Wilson plan five years ago—a commission which will regulate the flow of cotton imports and determine import prices. That is the only form of machinery which will stop the merchants who are at present sabotaging the Lancashire textile industry from continuing to destroy it for their own miserable private profits."—[OFFICIAL REPORT, 1st July, 1963; Vol. 680, c. 141.] That was stirring stuff; those were fine words. No doubt many hon. Gentlemen on the back benches who were here then believed in those statements. No doubt hundreds of thousands of voters in Lancashire believed the assurances which they had had from these important members of the party opposite that such firm and positive action would be taken. Where, one might ask, has all that resolution gone? Gone with the wind, if it was ever anything more than wind.

Then we had the right hon. Gentleman, now the Foreign Secretary, making his great speech at Manchester on 19th July, 1963. Quite often doubts have been expressed about the precise words that he used, and I shall therefore confine myself to the Transport House news release of what he said. He called for four things: First, we must ensure that other advanced countries take their share of low cost textile imports", and in his closing address at the Cotton Board conference in October, 1965, the right hon. Gentleman the President of the Board of Trade will recall that he used even stronger words and said in substance: It is intolerable that we should have to take this large proportion when others take such a small proportion. Fine words, but we are still waiting for the action to follow them.

The Foreign Secretary also said: A Cotton Council must be established to advise, supervise, and where necesary regulate imports of cotton goods into the United Kingdom. Again, fine words, and we are still waiting for the action. The right hon. Gentleman went on to say: Thirdly, there is a need for a greater measure of planning in the industry. Never has the industry found it more difficult to plan ahead than in the conditions created by this Government.

Those were the pledges, and now let us look at the performance against which those pledges must be measured. The hon. Member for Oldham, East has referred to the global quotas which turned out not to be global quotas. What we have discovered is that there are many loopholes in them. They make no provision for the spreading of the timing of the flow of imports, and nothing has as yet been achieved in persuading other countries to take a greater share of the load of imports.

That is the negative side, the failure of the Government to do the things which they said they were going to do.

On the positive side, what I referred to earlier as the kicks in the teeth delivered to the industry, may I just mention three effects of the squeeze. First, it was intended to produce, and did produce, a contraction in the size of the home market. Who carries the can there? It is the home producer in this as in every other instance. Secondly, the idea was to create a climate of economy which increased even further the tendency to buy the low cost imports at the expense of the home producer's product. Thirdly, the high rates of interest made it not only virtually impossible to go on with the re-equipping and reorganising which so many people wanted to do, and had started, but made it even more difficult for them to keep their mills open when there was no work for them to do. Then, as the hon. Gentleman said, on top of all that they removed the surcharge.

Anybody in the industry could have told the Board of Trade and the Government what the combined effect of all those things would be, and yet they were done without any steps being taken to safeguard the industry from the consequences. The importers are all right because they have their quotas giving them their guaranteed proportion of the home market. The burden fell, and fell heavily, as always, on the home producer.

We believe that those are the principal factors which have caused—