New Clause 67. — (Regional Employment Premium.)

Part of Orders of the Day — FINANCE (No. 2) BILL – in the House of Commons at 12:00 am on 14 June 1967.

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Photo of Dr David Owen Dr David Owen , Plymouth, Sutton 12:00, 14 June 1967

I welcome this Clause. I come from what I suppose is an area which would be described as a grey area and which has much claim to be a development area. Whether Plymouth becomes a development area or not, I believe that the premium is an extremely imaginative piece of fiscal policy, and as one who, in the last Budget, made representations to the Chancellor to introduce regional flexibility in the S.E.T., I welcome this proposal and, in the particular economic situation of the day, its emphasis on manufacturing industry.

The debate has been somewhat parochial. Everyone has argued the case from the point of view of his own constituency interests. Essentially what we are after is a control of the national economy. What we are desperately trying to do is to remove the regional imbalances and the very high areas of unemployment which exert strong social pressures on the Government to take economic policies which can be counter-productive and which are certainly one of the major factors in the stop-go economy. The Government's long-term economic policy has my full support, and I regard this proposal as a strengthening of their armament in this respect.

It was interesting that the hon. Member for Belfast, East (Mr. McMaster), in a difficult speech, made quite clear that he does not support his own Front Bench. He drew attention to the benefits which will accrue to Northern Ireland from the regional employment premium. Some people talk as though this were a new idea but, in 1962 a labour subsidy was proposed for Northern Ireland. It was discussed very fully, but it was not acted on at the time. We have had a capital subsidy for a considerable time now, and what we need is an extended range of measures, including the introduction of this labour subsidy.

I turn now to the points made by the hon. Member for Worthing (Mr. Higgins). The hon. Gentleman implied that the T.U.C.s support for the regional employment premium scheme was given purely on the basis that the unions could expect higher wages in the regions. This is a very cynical interpretation. I am sure that the main support of the T.U.C. for the proposal stems from the fervent belief that it will reduce unemployment in the regions. This is the principal reason why the T.U.C. is enthusiastically supporting it.