I beg to move,
That this House welcomes the remarkable economic and social progress in the Northern Economic Planning Region which has resulted from the policies of the Government, and would welcome further public and private investment to establish a permanently expanding economy in the region.
The remarkable progress which is referred to in the Motion, and which is being made in the Northern Region, is apparent to all except those too prejudiced to appreciate it. There are many visible examples of that progress, and I will quote briefly a few of them to substantiate the fact that remarkable progress is being made.
There is, for instance, the construction of an aluminium smelter plant at Lyne-mouth, which is bringing into the region one of the newest types of industry, likely to have a very long-term and expanding future. Very remarkable, too, are the shipbuilding amalgamations which have taken place on the North-East Coast as a direct result of the intervention of the Government in the affairs of the shipbuilding industry.
This has given the North-East of England, for the first time for a generation, a viable and world competitive shipbuilding industry. It is significant that the North-East shipbuilding industry at the moment has about £230 million of orders on its books, which is nearly 50 per cent. of the total shipbuilding orders of the United Kingdom.
If we move inland from the North-East coast we see in all the populated areas of the region the growth of a number of new industries going into advance factories and in other situations. In my constituency, for instance, there is at Tanfield Lea, near Stanley, the most modern dry battery plant in the world, designed for a major export drive into world markets. In Consett there is building up the most modern plant for the manufacture of polypropylene in Europe.
One of the problems of the Northern Region has always been the comparative geographical remoteness of its main centres of manufacturing industry from the main centres of manufacturing industry in the rest of the United Kingdom. Progress is, therefore, necessary in communications and it is, in fact, being made. The Durham motorway is virtually complete, and of no less importance is the great amount of work which has taken place on the A68 trunk road which runs from Scotch Corner in North Yorkshire directly to Edinburgh and which is as crucially important to industrial development on the west side of County Durham as is the A1 to industrial development on the east side of the County. In the western part of the Northern Region work is in progress on 50 miles of the extension of the M6 motorway. This is bound to play an important part in the development of industry in the west side of the Northern Region.
It is not unfair to say that it adds up to an economic and social revolution which is taking place in the Northern Region—an economic and social revolution which is all the more remarkable when it is viewed against the background of the cruel series of hammer blows which have been dealt to the region by the contraction of manpower in the basic industries of coal mining and heavy engineering, which, during the last eight years, have lost more than 100,000 jobs.
Before I leave this part of my speech I want to pay tribute to my right hon. Friend the Member for Newton (Mr. Frederick Lee) who, in his former capacity as Chancellor of the Duchy of Lancaster, was charged with responsibility for development in the Northern Region, who suffered a great deal of unjustified criticism in many quarters in carrying out that job and who has certainly played a major personal part in laying a very strong foundation upon which, I am sure, others will build in the future.
Having talked of the remarkable progress which has been made and is being made, I would, nevertheless, not for a moment seek to pretend that serious problems do not remain in the Northern Region. The nature and seriousness of the problem is demonstrated by the unemployment figures, which at 4·7 per cent. at the latest count, are still hovering around double the national average. But as a barometer of progress in the region, the overall figure for the region can be misleading. In some areas of the region the figure is much lower than, although I know that in others it is much higher than, 4·7 per cent. Indeed, in my constituency the unemployment figure is 5·8 per cent.
I should like to analyse that a little further, because important lessons can be drawn from an analysis of the employment figures in the region in looking to what needs to be done for the future growth and stability of the economy of the region. In the Stanley employment exchange, in my constituency, the unemployment rate for men is now 7·3 per cent., but no fewer than 62 per cent. of the unemployed men are 55 years of age and over. This is an area of particularly heavy pit closures, and these figures indicate that there is a particular problem affecting older men of working age in these areas. It is a staggering figure that almost two in every three unemployed men in that exchange are 55 years of age and over.
When we talk about percentages, I am always conscious that the man who is unemployed is 100 per cent. unemployed, and that if he is in an age group for which there appears to be no prospect of obtaining employment it is a degrading and demoralising position for him to be in. In addition, the loss of his labour is a waste of productive potential for the economy not only of the region but of the nation.
This analysis of the special problems in particular areas of the Northern region demonstrates the need for the further public and private investment for which I have called in my Motion in order to establish a permanently expanding economy in the Northern Region. It is also clearly indicated that there is need for selectivity and concentration of that investment in those areas within the region where particular problems remain. We tend always to think of the region in terms of manufacturing industry. But we must look at its economy beyond that. My view is that there is need to stimulate rather than retard service industries in the region and that there is a case for a regional relaxation of the S.E.T. in the Northern Region.
The great majority of the people of the region have never known economic security. However, whilst amongst the older people of working age there is still great uncertainty about their economic security, I believe it to be true to say that, consequent upon the progress being made, amongst the younger people of working age there is a developing sense of economic security. I believe that this is manifested throughout the region by growing demands for better housing and better education. For generations, the mere struggle for existence has been such in the region that people have by and large been content to accept lower standards in these things than elsewhere in the country. I am convinced now that the situation is changing and that this is why we see this growing demand for better housing and certainly for the expansion of educational facilities.
One of the things from which the Northern Region suffers is that, on the whole, a lower percentage of children have been remaining at school beyond the statutory school leaving age than in other parts of the country. The average in the country as a whole is about 50 per cent. but in the Northern Region I understand that the overall figure has not been much above 40 per cent. But, if one analyses the figures of school leavers and those remaining at school beyond the statutory leaving age over the past four years, one sees emerging the rapid increase that is taking place in the number of those remaining at school after the age of 15.
In the Consett multilateral unit in my constituency, the number remaining at school after the age of 15 is 63·2 per cent., which is substantially above the national average and is an indication, in my belief, of how the situation is changing in the region, reflecting a growing sense of economic security and a growing belief among the people in the future of their region.
I believe that, as confidence grows, there will be an explosively expanding demand for better housing, better education and better social and public amenities and services of every description. It is for this reason that I believe that there will be need for a massive public investment in order to provide these facilities and amenities.
You have indicated the necessity for hon. Members to be brief in the debate, Mr. Speaker, and I propose to observe your request and come to my conclusion. I hope that, by speaking briefly as the mover of the Motion, I might even set an example to others who may catch your eye. Remarkable progress has been made in the Northern Region. I believe that investment is now required there along the lines I indicate in the Motion, and I commend it to the House.
I congratulate the hon. Member for Consett (Mr. David Watkins) on his good fortune in the ballot for Private Members' Motions. I also congratulate him on his choice of subject and on the manner in which he delivered his speech. He has been very brief. I shall attempt to follow that good example. Once again, we are discussing the North-East and its problems, particularly its employment problems. This is one of a long series of debates.
I do not think that, at this stage, I should give way. I have hardly begun. I had not finished congratulating the hon. Member for Consett on his speech. I will happily give way in due course if need be, but that will only prolong the debate.
As I was pointing out, the problems of the North-East persist. Unemployment is at a frighteningly high level still and, once again, we must attempt, I hope constructively on both sides, to see what can be done about those problems and try to see some light through the darkness. It is still very dark. Consett is the highest point in the North-East—a very high and cold place, especially at this time of the year. I was told there once, "The first nine months of the winter in this place are the worst." We have had more than nine months of winter under the present Government.
I agree with the hon. Member for Consett about the problem of those who are 55 years of age or over, whether in Consett or elsewhere, who find themselves redundant. This is a grave problem about which we feel keenly and would like to solve. The hon. Gentleman called for public and private investment in the region, and I emphasise that there must be more concentration of such investment and that it should be more carefully applied than it has been.
With 6 per cent. of the nation's population, the Northern Region has 10 per cent. of the nation's unemployed persons. This in itself is a heavy condemnation of the Government and their regional policy, in that we have had a Labour Government since 1964. So, once again, one could emphasise, although it would take time, the failure of the Government's central economic policy. Without national economic growth, with heavy restrictions, with the Bank Rate at the level it is and with businessmen and industries, large and small, heavily curtailed by the central economic policy of the Government, there is little hope for any region to expand and improve its position, let alone a development area with the massive problems which the hon. Gentleman has emphasised.
I shall only briefly comment on the demise of the Department of Economic Affairs. We are delighted to see it go. We never thought it had much to offer.
We in the development areas, when thinking of the national economic position, should not be afraid to face the fact that we may well get natural growth through a revision of development area policy as we have known it now for some years. It was because of this that we on this side welcomed the Local Employment Bill. It is right that there should be some recognition that the grey areas of today might well be the black areas of tomorrow. We have far too many areas of one sort and another—development areas, grey areas, intermediate areas. Let us fasten hard on to the fact that it is national economic policy which is failing and if any easement—in I.D.C. policy, for instance—would improve the position, let us have it.
As I said on Second Reading of the Local Employment Bill, I deplore the Government's attitude to the Hunt Committee's Report. When we are thinking of our regional problems, hon. Members on both sides of the House should put electoral temptations behind us. Electoral considerations should take second place to economic realism. I repeat, if Merseyside, or any other area, has overcome its problems, I wholeheartedly agree with the report that it should be descheduled. The great tragedy of the Government in connection with areas which have particular and special problems is that they have always attempted to spread too little jam too thinly.
As in all former debates of this nature, we repeat from this side of the House that the greatest aid available should be given where it is most needed. Whether this be between development areas or within them, I emphasise that it is to areas of particular difficulty that such aid as is available should be given.
On 8th March, 1968, the hon. Member for Wallsend (Mr. Garrett) instigated a debate on this subject. I am not sure whether it was the last or the second last that we have had on the problems of the North-East. I then attempted to make two appeals. I asked for a thorough investigation of the effects of the injection of development aid to development areas, in the hope that we could see just what was happening subsequent to the enormous injection of capital which has undoubtedly been made by the Governments of both parties. Secondly, I asked for a thorough inquiry into the skill requirements of new industry which had gone into the North-East.
On the first issue of investment grants and how effective they are, there is good news in The Times Business Supplement this morning. It says that an investment grant study is planned by Whitehall—not before time. It is welcome news. Let us hope that this study is speedy. The Times is right to comment, as it does, that there has been "growing restlessness in industry" about the effectiveness of grants to development areas. The Times goes on to say:
… there is a growing conviction within the Government that the old investment allowance system was a more effective and less expensive way of stimulating investment by efficient firms ‖
If that is the thinking within the Government, we are clearly all becoming Conservatives together, because the Opposition have always said this.
The most disturbing feature of development area policy has been that this immense injection of capital, particularly in the North-East, has not brought the results which it should have brought in terms of jobs. We must look at it and look at it hard. Blanket aid has always been wrong. The Government's main mistake was that, having found that subsidy was encouraging capital-intensive industry, they decided to subsidise wages as well through R.E.P.
The right hon. Member for Fulham (Mr. M. Stewart), the present Foreign Secretary, when he had charge of the Department of Economic Affairs, told me in answer to a Question that the great advantage of R.E.P. wold be that it would bring quick results, that jobs would come more quickly through its application. The situation after all this time with it, is considerably worse; it is worse than ever.
I am pleased that the hon. Member for Middlesbrough, West (Dr. Bray) is in his place. In a recent speech in the House, he rightly stated that some subsidy, some injection of capital, was going where it was neither needed nor wanted; in other words, that the injection was ineffective. To summarise this part of my speech, I suggest that capital injection into the development region which is the North-East is in a hopeless mess and should be reviewed urgently and immediately, and again I welcome the suggestion in The Times this morning.
How much has this injection meant in terms of jobs? I was interested to read in the Northern Echo of 22nd November that the right hon. Gentleman the President of the Board of Trade had said that there had been criticism that some Government aid to development areas was wasted, that it provided more money than was necessary for each new job. The right hon. Gentleman took a period and stated a figure. The period is somewhat interesting. He chose that from April, 1960, to April, 1969, and gave the cost of providing a new job in the North-East over that period as being £637.
By breaking it down a bit, from 1st April, 1960 to 1st April, 1964, I found that under the Conservative Government it cost £385 to provide a new job in the North-East, while from 1st April, 1964, to 1st April, 1969, it cost £622. The right hon. Gentleman took the longer period because he understandably wanted to bring down the average by bringing in some cheaper Conservative years. The hard and awful truth for hon. Members opposite to swallow is that everything costs more with a Labour Government. Everything has shot up in price under a Labour Government, and it is costing a considerable amount more money to provide a new job under a Labour Government than it did with us.
When approximated, the figures are disturbing. They show that at present, with a Labour Government, 33,000 fewer people are employed in the region than in 1964 and that the Government have spent nearly £100 million to get to this state of affairs. The hard message of the figures is that under a Labour Government the number of employees has gone down and cost of providing new jobs has sharply gone up.
I will say little more other than to touch on my second point. I should like the Minister of State to say something about the present training position. Will he say something about sponsored courses? There is a great hope here if these courses can be developed rapidly and on progressive lines.
I sum up by saying that the regional policy of the Government seems to have rested on the assumption that we could have growth on the outskirts of the country by restraining growth in the centre. It is time that we took a good hard look at this and realised to the full that it is national economic growth which is essential to the future prosperity and development of the North-East and other development areas. Secondly, it is high time that a great deal more care was taken to relate subsidy to actual jobs actually created. Blanket aid is wrong, always has been wrong, and continues to be wrong. We must seek to give the greatest possible aid available between and within development areas.
All the speakers this afternoon will have an interest in the Northern Region, but we all have a particular interest in our own constituencies.
I intend briefly to speak about Sunderland, and, to put what I shall say into perspective, I say at once that we have had considerable Government aid over the past few years. Our major industry is shipbuilding, and no Government have helped the shipbuilding industry more than the present Government. At the same time, Sunderland has benefited from massive development aid over recent years.
To save my hon. Friend the Minister of State telling me when he winds up the debate, I will tell him that the industrial development certificates approved for Wearside from the beginning of 1968 to the third quarter of this year number 25, account for 800,000 sq. ft. and will provide employment for 930 men and 280 women. In addition, we have had approved four advance factories, two of them completed and two being constructed on the Pennywell Estate.
Again, most of the proposals for which I have campaigned over the past year or two have been implemented, though I ask my hon. Friend to tell me what, if anything, has been done about the proposal I once made that we might have a small containerisation berth at Sunderland.
We have been asked to help ourselves and we have spent a good deal of out resources in doing so. We have completed the central redevelopment scheme and we shall complete the new civic centre next year. We are told to be mobile. Whilst 11,000 people move into the town of Sunderland every day to work, 16,000 people from Sunderland work outside the town. That is a record that can compare with most industrial cities in the country.
But in spite of all this we have had persistent unemployment at a high level, and we cannot be satisfied. That is why I propose to make a few constructive suggestions and criticisms to my hon. Friend. First, we have not got the structure of government right. We have far too many Ministers at the Ministry of Technology for good management. We would all like to join in paying tribute to what my right hon. Friend the Member for Newton (Mr. Frederick Lee) did for the Northern Region, but I felt then, and feel now, that he should have been a Member of the Cabinet, and that it was perhaps a little unfortunate that he was attached to a Department which was being run down. We all respect and admire the vigour and energy of my hon. Friend the Minister of State. We know that he will do his utmost for the Northern Region, but I doubt whether he is rightly attached to the Department for Local Government and Regional Planning.
However, I understand that the Department deals with the reorganisation of local government, and one thing that my hon. Friend could do is to make sure that Washington comes into greater Sunderland. This would make sense from every point of view—not only that of local government but also of industrial location. Anyone who realises the importance of Sunderland within the North-East will recognise how significant it is that over the past year or two for every firm that has been attracted by the Board of Trade to visit Sunderland six have gone to Washington without visiting Sunderland. That does not make sense of industrial location.
Secondly, as has already been said, present Government incentives are too diffuse; they are not sufficiently specific. For a couple of years or more, for example, we have had an advance factory in Sunderland standing idle and vacant. We cannot afford this, the Government cannot afford it, and the taxpayer cannot afford it. I can see no reason why we should not consider bringing in public enterprise, having provided the factory, to run it. I am sure that this would not raise any opposition within private industry. The fact that it has stood idle for that length of time has proved that it is time for public enterprise to come forward. This has been suggested time after time, and it should preferably be public enterprise with a market in the public sector.
I still do not think that we are sufficiently dogmatic in seeing that more Government contracts come to the development areas, particularly those parts of them which now carry exceptional unemployment. I know that diversification is an essential element of development area policy. But I do not think that we go far enough. Whilst it is welcome, a good deal of our diversification is too piecemeal. What we need, particularly on Wearside, is a new industry.
We are a famous centre for glass-making. We have one of the finest glass-makers in the world with tip-top management, first-class research and development, and some skills unsurpassed anywhere in the world. This enterprise which exports one-third of its products, thanks to all those efforts, can give secure, stable employment to 3,000 workpeople in Sunderland. That is important, but it is unrealistic to think that within Sunderland we can expand the opportunities for work. It is only by dramatic increases in productivity that we have been able to maintain employment for the 3,000 to work there. To provide extra work, we must bring in a new industry.
The position in shipbuilding is that our North-East yards employ 22,000 fewer men than they did in 1955. This is a retraction comparable to coal mining, and when we realise how concentrated shipbuilding is on the North-East Coast, we find it not surprising that we have heavy unemployment on the Wear at Sunderland.
Looking at our unemployment problem in this context, we feel we not only need a new industry to provide employment on that scale, but that it is absolute nonsense to refuse the Wearside and Sunderland the special development area status. We have an unemployment problem far worse than many of the present special development areas. From the planning point of view, it is nonsense, through the present special development areas, to try to attract industry away from Sunderland to, for instance, the western part of County Durham. We must look at the whole of the Wear Valley and realise that it centres on the hub of Sunderland, and that here is where we should concentrate aid.
I have already mentioned shipbuilding, and what the Government have done. They have brought a security to the yards that they have not enjoyed for a long time. I am happy to say that this expresses itself in new labour agreements which should bring security to those who work in the yards. Nevertheless, at the same time, two points disturb me. First, over half of Britain's order book at present is placed in yards on the North-East Coast. I have noticed—this is perhaps an envious eye—the assistance that has been given to Harland and Wolff and the assistance that will apparently be given to the lower Clyde. We must see that we get comparable assistance on the North-East Coast, the most important shipbuilding district in Britain.
Secondly, I have mentioned and emphasised security, but we want far more than that. We cannot afford to lose sight of the Geddes target of 2¼ million tons. We must move towards that. I would like to see a much more determined effort by British shipbuilders to work off the order book. More orders are still there to get. We are now being affected by the length of our order book, but I would like a concerted effort to see that we increase our output and enjoy a higher proportion of the world order book.
Finally, I should like to say a word about Government capital expenditure, which is crucial to the rehabilitation of the region, Again, two things disturb me. The first is housing. A substantial part of that capital expenditure is on housing and we cannot afford to allow our local authorities to cut back the housing programme as mine has done Housing programmes must be maintained.
Secondly, I would emphasise that the most important element within that expenditure is education. We still need and must have a new university in the North-East. We must still see that we are not an impoverished region compared with others as regards education, because nothing is more vital to the attraction of industry than high educational standards. But if we think of Government capital investment we are really thinking about the general environment character of the region. I remember that, years ago, the Easington Rural District Council coined a slogan, "Farewell to squalor". Out of that came Peterlee. If we revived that slogan and again said "Farewell to squalor" we would, at the same time, be saying farewell to most of the difficulties that have beset the North-East.
I am sure that the House is very grateful to the hon. Member for Consett (Mr. David Watkins) for raising this important matter. I should like to follow his welcome example, which I wish was followed in more debates, of being brief.
My hon. Friend the Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott), in his admirable speech, put his finger firmly on the main problem facing the North-East. Despite the influx of capital, 30,000 fewer people are now employed than five years ago. We have the highest unemployment rate since the war, and male unemployment standing at about 7 per cent. This is an unwelcomely high figure.
We would not want to decry the Government's efforts, but I think that we can say that they have not met with singular success. We do not want to introduce personalities into this debate, but I hope that the Minister of State grasps, as I am sure he does, and understands, the problems of the North-East better than his predecessor. During the last few years we have heard a lot about a Minister being specially responsible for affairs in the North-East. He seems to be very much a gimmick man and has brought very little reward.
The right hon. Member for Sunderland, North (Mr. Willey) mentioned the factories which have gone to Washington to the detriment perhaps of the rest of the North-East. The new towns created in the North-East are doing very well, but the question which we must ask is whether they are receiving disproportionate consideration. It always seemed to me that Washington was not an area in which a new town should be placed. Geographically, it lies about six or seven miles south of Newcastle-upon-Tyne and about five or six miles west of Sunderland. It is, therefore, in an area which is already built over and the vast expenditure involved in the building of a new town seemed hardly wise in the case of Washington. However, is it wise to go on ploughing large sums of money into it and insisting on bringing new factories to the new towns to the exclusion of other areas?
Large areas of Sunderland have been cleared and are available for the building of factories. Instead of building factories in such areas, is it wise to concentrate them in places like Washington, which do not have populations large enough to service the factories? I ask the Minister of State seriously to consider whether it is worth pushing ahead with the building of new houses in the new towns.
We are very lucky to have in Washington such competent men running the management of the new town. It would be difficult to find a man of greater talent and general ability than Sir James Steel. He is perhaps making Washington more successful than socially it should be because, with such high unemployment in this area of County Durham, I cannot see that it is right that factories should be concentrated away from the areas of unemployment and houses built, thus bringing fresh people to the area. I do not wish to be too adamant, but I think that the time has come to have a hard look at the role of the new town in areas like this and the advisability, at this time of high unemployment, of taking factories away from areas where there are people unemployed and making it necessary for people to travel a few miles to obtain employment.
I think that practically all the industrial sites in Washington new town are now taken up. Who will work on them when they are built on? Almost inevitably it will be people from Sunderland, Chester-le-Street, Birtley and Gateshead who are at present unemployed. Are we not in danger of creating a social problem by pushing ahead with housing for people who will replace these people? Will not this in the long run increase the unemployment difficulties in the North-East? All development in this area is welcome, but we should consider carefully the way in which Washington town is being developed and is receiving favouritism to the detriment of other towns in the area.
My second point concerns Amble, in my constituency. I do not want to go over all the bitterness which resulted from the premature closure of the aerodrome there after the millions of pounds spent on it during the last few years and the Government's assurances that it would continue in use. But this was an unpleasant blow to Amble and there is a considerable risk of high unemployment continuing in the town.
I heard from the brother of my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley), who is the chairman of the county council, that a new factory is to go up in Amble, which will relieve some of the unemployment difficulties. But, in addition to this, there is an opportunity to make some sort of social centre in Amble, which is in danger of being dissipated by Government inactivity. Amble has a harbour which could make it one of the social centres of the North-East. I think that we would all agree that what this area needs is places to which people can go so that it may retain some of its attractions.
The harbour at Amble could be developed into a first-class yachting harbour for all types of small boats, being situated in one of the most suitable places on the North-East Coast. This is particularly important in view of the likelihood of Blyth being less available for this type of sailing. The harbour is in need of attention and I have heard that the Government will not give a grant towards its repair. I ask the Minister of State very seriously to reconsider this problem.
Amble is an area which could have a considerable future and become a resort. Its unemployment rate is extremely high. It could become an area with a totally different future from what it has now. When the old coal mines and the railways disappear, it will be ideally situated to become a centre to which people could go, but this depends on the maintenance of the harbour. I ask the Minister of State to think carefully about this.
That is all I would say, except once again to impress upon the Government that we on this side are very disappointed, after all the promises that were made and the talk of dynamic action that was given to us, that after five years of Labour rule there is now the highest rate of unemployment since the war and 30,000 fewer people are employed than at the time when we on this side received so much criticism.
I have every intention of respecting your wishes, Mr. Speaker, by being as brief as possible. I have only two particular issues to raise.
First, I should like to pay tribute to my hon. Friend the Member for Consett (Mr. David Watkins), who so ably moved his Motion. Like my hon. Friend, I, too, wish to pay tribute to the Government, despite what has been said from the other side of the House, for what they have done to help the Northern Economic Planning Region. There is no doubt that massive financial support has been given to the area by the Government, and this has continued since 1964, despite what we have heard from the benches opposite. While I readily admit that that support is beginning to bear fruit, we must also admit that it still falls far short of requirement and there is a lot more to do. Credit should, however, be given where it is due in this respect.
In saying this and admitting that a lot of help has been given, it would be very dangerous for us to become complacent and to think that everything will be all right as a result of the Government's actions and measures. That would be a mistaken and dangerous attitude of mind to get into because the Government, as I am certain my hon. Friend the Minister of State is aware, must realise that there is still quite a lot more to be done. That is a view which will be shared by both sides of the House.
Unemployment in the region has been referred to by my hon. Friend the Member for Consett. We must admit that it is still very high and, regrettably, much more than the national average. I have quite a lot of it in my constituency. I am sure that the House will forgive me if I quote unemployment figures from my constituency, but, if I may be allowed to explain, my constituency of Durham covers three employment exchange areas, namely, Spennymoor, Houghton-le-Spring, which is the constituency of my hon. Friend the Minister of State, but it comes into my constituency for registration purposes, and Durham City. Within those three employment exchange areas, we have a considerable number of unemployed.
The Spennymoor figures show that there are 1,022 men unemployed, and this is an increase since last year of 223. The total number of people unemployed in the area, including boys, women and girls, is 1,195. This in total represents an increase of 261 since last year. In Houghton-le-Spring employment exchange area, there are 811 men unemployed. Including boys and women and girls, the figure is 1,006 or an increase of 108 since last year.
Taking the Durham figures, I find that there are 1,153 men unemployed and that the total figure, including boys, women and girls, is 1,328. I must admit that these are favourable figures compared with last year, because there has been a reduction of 201. This is a favourable trend which, I hope, will continue, and I hope that this kind of trend will extend throughout the whole region.
All told, therefore, within those three employment exchange areas there are 3,529 people unemployed. I am sure that these figures are known to my hon. Friend the Minister of State and I concede that they might not be as high as in other parts of the region. Nevertheless, they are sufficiently high for us to be concerned about them.
I therefore complete the point by putting a very simple question to my hon. Friend the Minister of State. He is on record as saying that there are at present 42,300 jobs in prospect. My simple question is this: how many of those jobs will find their way to the areas of Spennymoor, Houghton-le-Spring and Durham? The only thing I can do is to express the hope that these areas get their fair share.
The other question which I would like to put briefly and without going into the matter in any depth is in connection with the social progress within the region. I am very glad that my hon. Friend the Member for Consett has mentioned this in his Motion. What is common ground between both sides of the House is that a high level of employment is a very desirable thing, and this should be our aim. It should be the aim of the Government to try to achieve it. While admitting the importance of this, however, it is of equal importance to make sure that the whole of the social services keep pace. We must not have an imbalance of high employment and have these things lagging behind. It would disturb me if that kind of thing happened.
It must be admitted that in this respect the Government have a very good story to tell. When one looks at training, health services, schools, further education, the youth service, universities—my right hon. Friend the Member for Sunderland, North (Mr. Willey) talks about wanting another, and so do I— and research and tourist facilities, all these have had a terrific boost and support from the Government. That is very desirable and we are pleased about it.
One aspect, however, which gives me, at least, cause for concern is the question of doctors within the region. I know that I am raising a point which should rightly be directed to the Department of Health and Social Security, but I have informed that Department that I intended to raise this matter and I hope that what I say will be conveyed to the Department by my hon. Friend the Minister of State.
The shortage of doctors affects the whole country. The whole of our hospital services are very dependent on doctors from overseas. In this respect, the hospitals within the Newcastle Hospital Board area are more dependent on doctors from overseas than most other regions. I was able to obtain figures applicable only to the end of September of last year, when, out of 1,453 doctors in the Newcastle Hospital Board's area, 505, or about one-third, were from overseas.
Doctors who come from abroad to work in our hospitals have done, and are doing, a magnificent job and deserve every tribute. However, if we are dependent on them to such a great extent, we must be concerned lest, first, they decide to return home—they are not obliged to stay here—or, secondly, this source of supply dries up and they are no longer available to us. If either of those was to happen our whole hospital service would collapse.
This is causing great concern in my part of the North-East and I hope that the Minister will convey to the appropriate Department the feelings that I have expressed. If I can be given assurances on the two matters that I have raised, I will be more than grateful.
It is inevitable that constituency problems should be raised in a debate of this kind. Perhaps I should begin, therefore, by apologising because my constituency does not come within the boundary of the north-eastern area. However, it is in the West Riding and I assure hon. Members that what happens in one area can have an adverse effect on another, particularly if that other area does not have the advantage of being a development area.
I congratulate the hon. Member for Consett (Mr. David Watkins) on initiating the debate. When I read his Motion I was ready to challenge some of its assertions, though I was prepared to accept that
… remarkable economic and social progress ‖ has resulted ‖
Having heard the speeches of some of his hon. Friends, however, I must question whether even that part of the Motion is not rather exaggerated.
Considering the great amount of financial assistance that has been given to those fortunate enough to be established in development areas, it would be difficult to imagine economic and social progress not having been made. Indeed, if there had not been any progress there would be a severe indictment on the system which would demand careful scrutiny by the House and the Department concerned.
I understand that aid to the development areas is running at about £300 million a year. Some of us think that this money should be more widely shared because the favoured terms enjoyed by those in the development areas can adversely affect other parts of the country. I am not thinking only of S.E.T. and R.E.P., although hon. Members will appreciate the burden which falls on those outside the development areas who must help to pay huge public expenditure of this kind.
The Hunt Report has been published since we last debated the North-East and it set out a request that a cost-effectiveness study should be made of the inducements which have been offered to people to go to development areas. I am told that the present inducements are such that labour within an area can become in short supply, with the result that a system of bribing labour to fill places is being established, this at a good deal of Government expense. This scramble for labour, as it were, has developed differently in different areas. In some areas, however, there are still pools of male unemployment.
I was told last week by a person who is engaged in a factory which went to the North-East, and which employs a considerable amount of female labour, that the factory was at its wits' end to know how to get men to man its machines. Something must have gone wrong somewhere. Originally, in this case, there was huge private investment. There followed public investment and then, at the end of a comparatively short period, this firm has found itself in precisely the same labour position as it was before it embarked on an excursion into a development area many miles away. This is a serious criticism of the present arrangements, and the Government must ensure that cases like this do not recur.
I have a close connection with many people in industry, including firms which have been established in development areas long before those areas were designated as development areas. These firms are enjoying all the advantages of those which have gone in response to Government's requests to development areas in the hope of solving their labour problems.
It was surely never intended that firms already established should enjoy the advantages of being in development areas. If they wish to expand they will do so where they are and as they probably have been developing for two or three centuries. There should not be great difficulty in separating the long-established firms from those which have recently gone into development areas.
We are beginning to see—this is particularly so in the West Riding of Yorkshire—a change in the economic and commercial climate. Many wool mills have gone out of existence and I am told that during the last two or three years the number of bankruptcies in this industry has been greater than ever before. The cumulative effect of this and other factors on those who must maintain their industries in non-development areas at high cost is beginning to tell, and that is why many people believe that the load should now be more widely shared.
In other words, while in this debate hon. Members are right to be concerned with constituencies which have been fortunate enough to be situated in development areas, the time has come when the change in industrial climate to which I have referred should make us adopt a more generous attitude towards the non-development areas.
I am grateful that my hon. Friend the Member for Consett (Mr. David Watkins) has framed his Motion in such a way that it applies to the Northern Region as a whole. The reason I interrupted the hon. Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) was to remind him of this. In the early part of his speech he constantly referred to the North-East Region.
I wish to plug this afternon that part of the Northern Region known as Cumberland. We are grateful for the recognition given by the Government to Cumberland and for the help which we have so far received. We are glad that Carlisle was designated in the development area list but, despite all the help which has been given to us by way of grants, factories and so on, we are, naturally, looking for more.
Unemployment is more severe in West Cumberland, particularly in Millom, than in other parts. Despite all the efforts of the Board of Trade, no break-through has been made in bringing new employment to Millom, and I hope that the Government will look seriously into this. Cumberland, like other parts of the Northern Region, has suffered from pit closures. We now have only two or three collieries in operation, and I plead that these shall be allowed to continue. The main weakness of mine closures is that pits have been closed but no alternative work has been provided, and West Cumberland is still suffering from this policy.
The announcement a few weeks ago of a new motor car factory for Cumberland was most welcome, and I pay tribute to the work of Sir Frank Schon and the Cumberland Development Council, and also to the Prime Minister, for steering this important industry to Cumberland.
I also welcome the statement, published by the Government at noon today, that they are asking the Northern Economic Planning Board to examine the potential of Carlisle and West Cumberland. May this be pursued with all speed. I am glad, after so many years of dithering, that a Labour Government have made the decision to improve the road between Workington and Penrith. This will eventually give link up with the M6 and make this part of the country more attractive to industry. I hope that a favourable decision will soon be made for the electrication of the railway line between Weaver Junction and Glasgow, thus bringing in the Carlisle area. Arising out of that, I hope that consideration will be given to a freightliner depot in the area. This would greatly help industry, especially with transport problems.
We are worried about the closure of Hadrian's camp. My hon. Friend knows something about this, because of the correspondence that has passed between us during the past six months. It would be a tragedy if this became another derelict camp of past glory after all the money that has been spent on the site. I plead with the Government to ensure that Hadrian's camp is use for some purpose.
I hope I shall not be accused of being too parochial. We need more factories, more industries, and I ask the Government again to look at Carlisle and the Solway area as a major growth area and to assist the local authorities in the provision of houses. Might I also suggest that the feasibility study of the Sol-way Barrage be looked at again with a view to its implementation?
Much more could be said about the needs of Cumberland—the hospital services, B.B.C. 2, the extension of radio. I would like to see consideration given to the development of the ports of Cumberland and other matters affecting the people—and this debate is centred ultimately on people.
We in Cumberland are grateful to the Labour Government for all the help they have given us, but, like Oliver Twist, we are asking for more. We are not an isolated community, although that may sometimes seem to be so in debates and in geographical terms. We are an important part of the community. History has proved that, but we cannot live upon history. We look to the future and believe that Cumberland, with other parts of the Northern Region, can make a contribution to the welfare of our country and of our people.
It was a particular pleasure to me to see my hon. Friend the Member for Durham (Mr. Grey) on his feet for the first time after his long period as Whip to the Northern Group of Labour Members. We look forward to hearing him on many other occasions after this pseudo-maiden speech.
The North-East Development Council estimates that the number of new jobs needed to reduce unemployment to 3 per cent. and to replace the jobs lost in mining, shipbuilding, steel and agriculture is 28,500 a year for the next five years. If we expect to get anywhere near this, fresh measures are urgently needed. Some of them must come from the more effective deployment of incentives, about which I spoke on 3rd November, and some by the use of public enterprise; some, too, must come from widening the kind of job that we are seeking to create. Twenty-eight thousand jobs a year sounds a lot, but this has to be set against the total employed in the Northern Region of 1,200,000.
In the country generally, about a quarter of the working population changes jobs every year, so that there are 300,000 job starts a year in the Northern Region, and only one-tenth of these need to be new jobs. With all the job changing that is going on anyway, there is no need for the new jobs to be exact replacements of the old jobs in terms of occupation, pay and status. Indeed, if they are exact replacements, the North-East will be anchored to an obsolete occupational structure while the rest of the country goes romping ahead. That, I fear, is the effect of the development area policies of successive Governments and the reason they have not been more successful.
Since 1960, employment in manufacturing nationally has actually fallen. By contrast, employment has grown in financial, professional and scientific services by 840,000, in miscellaneous services by 131,000, and in national Government service by 80,000. This makes a total of over 1 million new jobs towards the upper end of the occupational scale, with none of them qualifying for development area incentives. The North is told to fish in the shrinking pool of the manufacturing industries, while the lush expansion of service industries is left to the South.
The purpose of Government development area policy should not be merely to enlarge the raft of manual jobs at the bottom of the occupational ladder, but to supply the rungs that are missing in the occupational ladder in the North, so that the population as a whole can move upwards, allowing plenty of room for those who are seeking manual jobs and should have them. The missing jobs in the North are in non-manual and personal service jobs, which employ only 25 per cent. of men in the Northern Region, compared with 31 per cent. nationally.
What are the missing rungs in the Northern occupational ladder? They are offices, laboratories and universities. That is, offices for company headquarters, commercial activities, social services, and the professions; laboratories and design offices for medicine, local government and other services as well as for manufacturing industry; and universities to train, retain and attract highly qualified people, and create an environment attractive to high grade employment.
I shall argue that the single most important and most fruitful new step the Government can take at once is the major expansion of Durham and Newcastle Universities and the creation of a new Teesside university.
First, let us look at the other rungs, offices and laboratories. The Government are already sending, and must continue to send, any movable office to the development areas. They have, I fear, neglected Teesside, which has the greatest lack of office employment. This should be put right. But the Government have sent every office available to somewhere in the development areas. While the pressure must be kept up, it will not provide any great number of jobs.
As for private offices, advance prestige offices should be built in Newcastle, Teesside and Sunderland to attract private office employment, but private employers are not likely to come in great numbers unless a physical and social environment is created which is attractive to such employment. Laboratories and design offices themselves do not qualify for regional employment premium or the investment grant differential, and they should qualify. But, again, the right social environment is needed, and for this there needs to be a great improvement in educational standards and provision in the region.
So I come to deal with education. The North is unique in having suffered grievously from industrial change, with no new university and an academic tradition that has never been quite the same since the Venerable Bede died twelve hundred years ago.
Durham and Newcastle Universities have done well. They increased their numbers between 1961 and 1968 by 56 per cent. to 9,000 students, but the increase in Great Britain as a whole has been 93 per cent. In other words, the relative position of the Northern Region has deteriorated since before the Robbins Report. The region now has 2·6 university student places per 1,000 of population, compared with 4·1 for Great Britain as a whole, 5·0 in Wales and 6·6 in Scotland. To catch up with the national average, the North should have 5,000 student places more than it has today.
Looking ahead, the Department of Education and Science estimates that the demand for student places in higher education will be running at some 40 per cent. above the Robbins estimates in the mid-1970s and beyond. If the proportion of these places in universities remains no higher than its present level of 53 per cent., 120,000 more university student places will be needed by 1976, and 200,000 by 1980. Only to catch up with the Great Britain average, without exceeding it as Scotland and Wales have done to their advantage, 12,000 new student places will be needed in the Northern region by 1976 and 17,000 by 1980. Even if Durham and Newcastle Universities were to double their numbers in eight years, which is more than they were able to do in the past 10 years, they could not provide places needed to bring the Northern Region to parity with the rest of the country.
The strategy, therefore, should be that Newcastle and Durham Universities should expand as rapidly as possible with all the benefits of the vitality that has been found to go with rapid growth, and a large new university should be established on Teesside as soon as possible.
What of the cost? No one who gets around the universities, and especially the technological universities, would wish to divert any money from the improvement and expansion of their facilities. But where there is an overwhelming case, as there is uniquely in the Northern Region for a new university, it is difficult to argue that the cost per place in the single new university on a low cost site would not be lower than some at least of the university expansion schemes. The case is conclusive when it is seen that the cost of this extra expansion of Northern universities can, and should be, financed out of development area funds and not out of the education budget, by redirecting some of the spending on the investment grant differential, as I proposed on 3rd November.
I should like to deal briefly with some counter arguments. First, students travel to universities outside their home region. This is so, but the Department of Education and Science is trying to increase the proportion of students living locally so as to reduce costs, and universities already have a considerable local bias in their entry particularly in Scotland and Wales. Secondly, graduates usually do not work near their old university. This is true, but universities are magnets for graduate and high grade employment generally.
Some might argue that the North needs further education more than university education. Already, the number of students in further education in the North is 84 per cent. of the national average, while university places are only 63 per cent. of the national average. With many vacant places in further education and three polytechnics scheduled, the North is getting the right treatment in further education. The North needs more teachers, particularly graduate teachers. The shortage of non-graduate teachers is confined to some authorities like Teesside, so the Department of Education and Science, in its wisdom, put the new college of education not in Teesside but in County Durham, which exports teachers already.
The greatest problem in education in the North is premature school leaving. This is true. More graduate teachers, reorganised secondary schools, a changed occupation structure, and wider horizons in the local community are needed. Local universities have an important influence in this matter.
Finally, it might be argued that money cannot be spared by cutting off payments of the investment grants differential at £5,000 per job created on large projects costing more than £1 million, as I suggested on 3rd November, because the North-East needs modern science-based industries. Most science-based industries —computers, electronics, instruments, jet engines, pharmaceuticals, automation equipment, and so on—are not capital-plant intensive. They are development-cost intensive, but no regional incentives are given for this and the North-East is not getting them anyway. The only really capital-intensive science-based industries are the process industries, chemicals, oil and steel, and there often only production is done within the region, employing a steadily declining number of people.
Finally, we want quick results. I know of 5,000 industrial jobs which the North-East has lost during the course of the past year because its university prospects are dim by comparison with that elsewhere. It is the here and now that I am concerned about. The North-East will go on falling further behind until this education and social problem is dealt with.
I should like to add my congratulations to the hon. Member for Consett (Mr. David Watkins) for initiating this debate, although I am bound to say that the Motion is in rather over-fulsome terms.
I make no complaint, but perhaps my memory is at fault. I understood that originally we were to discuss the Report of the North East Development Council. Personally, I am glad that we are not doing so, because it is much better for hon. Members on both sides to be able to talk on particular issues of which they have knowledge. So I am glad to see that, somehow or other, the title of the debate has been changed.
The last report from the North-East Development Council was an extremely glossy and expensive publication. It was entitled "Outline Strategy of Development". Of course, it is very easy to write reports and describe general prospects. However, I do not see that the council has done anything to promote the few suggestions appearing in the report which were designed to help with the problems of the North-East and the Northern Region. I am glad, though, that the council has at last been given a specific job of work. Many able people sit on it, and I am a great believer in the importance of using all the brains that we can muster to deal with our problems.
The extraordinary differences in the official figures that we are given from time to time makes it extremely difficult to assess the true position of the North-East coast. I had no idea until recently that, when we talk about the unemployment figures of different places on Tyneside, officially the figures are lumped together under the heading "Tyneside". I do not approve of that. I would prefer to know the unemployment positions of different places on Tyneside.
Taking my own County Borough of Tynemouth, the centre of our industrial area is North Shields. We hear that there has been an enormous improvement in the shipbuilding industry. My constituency is concerned primarily with ship repairing. We have Smith's Docks, a very important ship-repairing area. However, in ship repairing, there has not been the high employment that has been found in such yards as Swan Hunter's, and quite a number of our men have been paid off.
The last report showed that Tyneside, which includes all the big areas, now has an unemployment rate of 5 per cent. That must be one of the highest in the country. In the past, it was decided to build a new dry dock in Scotland. I understand that it has now gone bankrupt. I have always wondered whether it was reasonable to have new dry docks. Though I sympathise with the deplorable unemployment position on Tyneside, if we are to develop a whole new area for shipbuilding and our economy has to be more stable and lively, I wonder whether we shall be able always to keep our shipyard workers fully employed.
There is a great deal of what I call overall consideration in the economy for the development areas, and it should be looked at carefully. Tyneside has an unemployment rate of just over 5 per cent., which is very high. But one finds oneself in difficulty in looking at the different types of figures. Any hon. Member has to be up bright and early to discover what the Government are doing with their figures. Sunderland's rate of unemployment is 8·1 per cent. South-West Durham has an unemployment rate of 9·7 per cent. South-East Northumberland has a rate of 10·8 per cent.
Those are very high and, when we discuss future problems, future policies and new developments, it is extremely difficult if we do not start from sound basic figures. Taking a figure which is the average rate over a wide area lessens the impact of the high unemployment rates in some parts of such an area. Figures have appeared in all sorts of different reports and in answers to Parliamentary Questions. When we discuss our problems, we need as many realistic figures as possible.
In 1968–69, 18,930 new jobs went to the North-East coast. In the first two quarters of this year there have been only 7,470 jobs. That is a considerable decline. In view of the burdens that the Prime Minister has to carry and the rotten policies that he has to implement, I suppose that he has been as helpful as he can be. But, like the Minister of State, the right hon. Gentleman always waits, and then says, "But look what the Government have done for shipbuilding". I need hardly say that I am all for a first-class shipbuilding industry, but other people have to be considered. They have as much right to the Government's aid as we have. Incidentally, I do not see why I should make the Government's points for them, though sometimes I enjoy doing it.
I cannot understand why all our difficulties should be submerged by this outcry about what the Government have done for shipbuilding. It would be appropriate if the Government said occasionally not only what they have done, but what management and men in the shipbuilding industry have done. There are many examples of wonderful cooperation between management and men. The Government are not the only people to have transformed shipbuilding on Tyneside and the Wear.
The other day, Sir John Hunter said that he was strongly opposed to going into the Common Market. He gave his reasons, though I do not necessarily agree with them. Apparently, he has never stated before that he had these objections. Whatever his views may be, I think that the Government and the Opposition are bound to listen and assess his reasons for making such a statement.
All three parties have expressed their views about British entry into the Common Market. It is generally agreed that it would be good for Britain to go in, provided that we do not have to pay too high a price. At a time when the Government are rushing ahead in the hope of being acceptable to the Six, it would be interesting to hear from the Minister of State an assessment covering the whole country industry by industry, but laying special stress on the North-East coast, which employs large numbers of skilled and unskilled men, setting out those which support the Prime Minister and those which do not.
It is a matter of vital importance to the North-East if the shipping industry is not in favour of application for entry into the Common Market. Birmingham, on the other hand, has always been a lucky area. It has never suffered from the unemployment problems of Tyneside, Wearside and the rest of the North-East. Therefore, the motor car industry is in favour of entry into the Common Market.
However, when we have a debate on the matter, I will not commit myself one way or the other until I hear the views of those in industry who are most vitally concerned. Instead of talking about it in general terms, which we all do—it is not a fault of one side of the House or the other—it is about time that we had a proper assessment of what industrialists, who have to support the economy of this country and initiate the exports which have helped so much to regain a favourable balance of payments, think about the policies of the three political parties.
I hope that the Minister of State will be able to give me an answer. On Tyneside, there are only two Conservative Members—[An HON. MEMBER: "Two too many."] There may be two too many, but there will be a good many "two too many" after the next General Election.
I should like to know how the Government are analysing both the economic and employment interests of the industries which are so vital to the North-East? If they wish to extend their analysis, it would be valuable.
That is what I should like to know. After all, Sir John Hunter has been President of the Shipbuilders' Federation for the past 12 months. He is a very important person on the Tyneside. Therefore, I am more likely to be guided by his views on the shipbuilding industry vis-à-vis the Common Market than for other parts of the country.
It would be extremely valuable if procedure would allow us to have a debate without Front Benchers so that all Members could get some information about how those who have to keep up our export programme feel their future will be affected, provided that we are invited and accepted into the Common Market.
The hon. Member for Middlesbrough (Dr. Gray), although he did not develop this point, talked about the cost to local authorities, and in other directions, of introducing new industries to the northeast. It has been suggested, I think by the North-East Development Council, that the Government might be able to help. The provision of roads is important in the industrial development of a development area. The depression put us a long way back, regarding schools, houses and roads, but road development has been spectacular.
It is fair to say that some of the roads were planned before the Labour Government took office, but they have gone on with the development and they have every right to feel satisfied at the progress which has been made. But this imposes tremendous burdens on local authorities. Therefore, I should like to know whether the Minister of State, in his persuasive way, can cope with the Treasury in seeing whether the development of suitable overall arrangements for introducing new industries can be met by additional grants.
The right hon. Member for Sunderland, North (Mr. Willey) mentioned the special development areas. I am grateful to the Minister of State, because he has agreed to receive a deputation from Tynemouth early this month. Tyne-mouth has an enterprising local authority. It has done a great deal to encourage development. I am delighted to say that International Formica started on our West Churton Trading Estate, the foundation stone of which was laid before the war. That brings it into the time of the Conservative regime, so it is not only Socialist Governments which have interested themselves in the development of the area. In a special area adjoining the Tyne Tunnel we have a considerable number of well-planned factories which have been built by private enterprise. We now require the Government's support to encourage industrialists to set themselves up in these well planned, up-to-date, modern factories.
I should now like to mention hospital development. I assume that the Minister of State is not only interested in industrial development, because he is a Member of Parliament for a constituency in the North-East. But we have hardly any convalescent provision. Only one regional hospital board has less convalescent provision than the Newcastle-on-Tyne Regional Hospital Board. It is important that we have up-to-date convalescent accommodation available, because many of our industrial workers are engaged in dangerous industries. We have developed excellent treatment for workers who have bad accidents, but it would be helpful if we could have more convalescent provision.
While I am on this subject, I should like to pay tribute to the magnificent operation of the helicopter service in relation to the North Star rig. It was remarkable. But I should also like to pay tribute to the men who work on the rig, because it must be a very dangerous industrial occupation. It goes to show that we have some magnificent people who will take every risk to try to help us develop a prosperous economy. I think that this operation by the helicopter service, and the men going back to the rig so soon after their terrifying experience, deserve a strong word of commendation, and I am delighted to have the opportunity of being able to give it.
A number of hon. Gentlemen opposite who are in the area of the Newcastle Regional Hospital Board and I were invited to visit St. George's Mental Hospital. Over the years I have often visited this hospital, and the situation there is rather terrifying. I want to know what the Minister intends to do to ensure that sufficient money is made available to deal with the frightful over-crowding. I do not want to over-emphasise in public some of the dangers in that hospital. When the Conservative Party was in power, Ministers of Health visited it and certain improvements were made, but at the moment there is over-crowding to the extent of 350 patients.
The idea—and it was a very good one?—was to deal with the over-crowding by building villas which would make it easier for the dedicated doctors, nurses, superintendents, and matrons, to carry out their magnificent work of administering that hospital. About eight or 10 years ago I was fortunate enough to be asked to open two villas. The authorities were told that they could have four more villas, but, because of the way in which the money is provided, the last villa will not be available until 12 years from now.
The beds in that hospital are so close together that no patient is able to have a small locker in which to keep his own possessions. There is not even a cupboard of any kind for patients to use. When they go to bed, they have to hang their clothes at the bottom of their beds. When I hear speeches in the House about trying to give people the opportunity of keeping their personal possessions near them, the thought occurs to me—and this is not a matter for purely one side of the House or the other—that we have fallen far short in ensuring that our mental hospitals are properly equipped and safe.
I want the Minister to assure me that he will try to get that 12-year period reduced. By the end of that period nearly all the patients in that hospital will have left this life, I hope for a happier one. Something must be done to help them now. What is happening there is not right, and I am sure that hon. Gentlemen opposite who have visited the hospital will agree with me about that.
I must not transgress——
There are many hon. Gentlemen opposite from the North-East coast, and all that they are doing is trying to keep their Government in power. It would be much better if we could get the Government out, because then we could do a little more poking. Many of us are good at poking our own Ministers. It is much easier to poke Ministers on one's own side than it is to poke hon. Members on the other side who think that it is their business to keep themselves in power.
I again congratulate the hon. Member for Consett, but I think that his Motion is too fulsome.
I am sure the hon. Gentleman does not.
Part of the attraction of the North-East coast is that people from there are loyal, and I should not expect the hon. Gentleman to be otherwise, but he tabled a beautifully fulsome Motion and then made a number of criticisms. I cannot help feeling that the Minister of State and the Prime Minister will look at the Motion, and forget all the speeches. That is probably the Minister's attitude. We on the North-East Coast would like to see in office our own Minister of State, who would not be confused by the Prime Minister or by the Chancellor of the Exchequer but would get on with doing a really good job so that we can make the necessary progress which we think is essential if we are to survive.
My hon. Friend the Member for Tyne-mouth (Dame Irene Ward) said that the Motion was a little fulsome. That thought occurred to me for broadly the same reasons as those given by my hon. Friend; namely, that it tends to pat the Government on the back for a lot of things for which they are not entitled to be so patted.
Although I think the Motion a little fulsome, I am delighted that the hon. Member for Consett (Mr. David Watkins) widened the debate to cover the whole of the Northern Economic Planning Region, because, as the hon. Member for Carlisle (Mr. Ron Lewis) said, this enables those who come from the western part of the region to draw attention to Cumberland and Westmorland, an extremely important part of that region. I wish to concentrate on that part of the region, and in particular on Westmorland.
In Westmorland there is very much of a changing scene at the moment. I shall try to explain what I mean by that, but I must first tell the House that, having been round my constituency at the weekend, I have found that the one thing which has not changed, and which does not look as though it will ever change, is that my constituents are incensed about the B.B.C.'s proposed development in local broadcasting stations. Over the years my constituents have been extremely patient about the inferior quality television reception they get while being asked to pay the full licence fee. They are incensed now that all this money is to be spent on providing an extravagant form of local broadcasting in towns and cities while they have to put up with the present second-rate reception.
I said that there was very much of a changing scene in Westmorland. I suppose that the main part of that change is coming, and will continue to come, from the construction of the M6 motorway, which is going from Carnforth in the south to Carlisle in the north. When the bulk of it is open next year it will provide many job opportunities in the area, and this will be heartily welcomed in an area which has had to face great problems.
One thing that will result from the construction of the M6 is that the Lake District will be very much easier to get to. In future millions of people will be able to visit the Lake District on a day trip. The scope of the day tripper, whom we very much welcome in that area, will be extended, and it will be possible for people who live in Birmingham and places like that to visit the Lake District for the day.
That area is, without doubt, the most attractive part of England. Although it is easy to criticise the Lake District Planning Board—and I have done so on several occasions—I think it deserves recognition for the fact that the Lake District is still largely unspoiled, and also for the fact that few people criticise the board for desecrating the area. Caravan parks occasionally mar the views in certain valleys, but, in general, the board deserves recognition for the conservation job that it has done.
The problem will be: how will the board handle the visitors who come to enjoy this incomparable scenery? There is no doubt that at the moment there are excellent tourist facilities in the area. We now have restaurants and hotels which compare with those in any other part of the country, including London. There are very good commercial facilities to cater for tourists. A problem will arise, especially at weekends, from the great rush of people using the new motorways to visit this beautiful area. There is the threat of considerable traffic chaos in the relatively narrow roads in the valleys.
The planning board faces a great dilemma in knowing what is the best way to deal with the influx of visitors. Does it widen the roads to allow more cars to pass more quickly around the valleys and run the risk of spoiling the amenities? Does it, on the other hand, control the traffic, as has already been considered in relation to valleys such as the Langdale Valley? The consequence of control is infuriation of local residents. That has already happened. Many of them rely on visitors for their livelihoods.
We shall definitely need more car parks, and probably more caravan parks and camping sites. I hope that the latter will be placed on the verges of the national parks. I know that that is the policy of the board, and I am sure that it is the right one. I hope that we shall not have to have the physical control of traffic in our valleys and most popular tarns and lakes until there is no alternative. The moment does not come for the physical control of traffic until there is a complete breakdown in its movement.
One of the domestic problems of the Lake District arises from the short length of the season. People who run hotels, boarding houses, restaurants, cafes and other tourist accommodation face the problem of the short season. because it is difficult to obtain staff for the relatively few months of the season. Most tourist facilities close for the winter. It would be useful if future development in the Lake District helped to extend the season.
For that reason I welcome the recent proposal to construct a theatre at Windermere. It was possible to criticise its site and its area, but the concept was a good one. If we could have a Lake District festival in the early summer, and conferences at other times in this very beautiful area, it would be for the good of the Lake District as a whole.
I now turn to the northern part of my constituency, which is not so well known, scenically, as the Lake District. I refer to the Eden Valley. The region round Appleby and Kirkby Stephen, down to Penrith, faces great problems from depopulation. There was a considerable drop in population between 1951 and 1961. I have quoted figures on previous occasions showing the frightening proportion of young people leaving the area. There are some signs of improvement. There are signs that various factors are working together to stem the outflow of population from North Westmorland. I have referred to the construction of a motorway. There is no doubt that this will generate many jobs in the area. We hope that we can have a service station constructed at Tebay. Problems have arisen about this. I have been in contact with the Ministry of Transport, and I hope that now the site is out to tender again we shall be able to get some development there.
Secondly, in North Westmorland we have a considerable expansion of the gypsum works at Kirkby Thorne, between Appleby and Penrith. Millions of pounds have been poured into the new plasterboard mills, and the new jobs created and houses erected in many villages at the west end of the Eden Valley have been of great benefit to the area.
There is an improved situation at the eastern end of the Eden valley, where most of the depopulation problems have arisen. Two new factories have been developed in the last few years, one making bobbins and the other art reproductions, which are magnificent and are being sold in the large London stores. Those two new developments have created new job opportunities in the area, but these are early days.
We also have the promise of an advance factory. There have been considerable site difficulties about this. I hope that the Minister of State will refer to the advance factory in Kirkby Thore. I know that the county council is having great problems in obtaining a site, and I hope that the Government will give it every assistance.
The final development in North Westmorland has been the establishment of the headquarters of the North Pennine Rural District Board at Appleby. I am somewhat cautious about the board. It has terrifying powers if it cares to use them— powers which my party voted against when the Bill setting up the board was in Committee. I hope that it will not turn into what I described when we debated the Orders concerning it as a bureaucratic extravagance. I was alarmed at the figures that I received from the Ministry of Agriculture last week about the staffing and the costs of the board.
I draw attention to those figures because they are very alarming. On 8th
July last I asked the Minister of Agriculture to
estimate the cost of running the North Pennine Rural Development Board over the first year …".
His reply was that it was likely to cost about £15,000 to buy the premises and that other administrative expenses, including salaries in the first year, would be about £20,000. That makes a total of about £35,000. When I asked the same Question last week I was told that the likely expenses in the first year would be £45,000. Between July and November— a mere four months—there has been an escalation of about £10,000, or about 30 per cent.
In July I asked how many staff would be employed, and to what extent that figure would be altered after the first year. I was told that, initially, it was expected to employ a secretary and a chief land agent, together with about half a dozen supporting staff—eight people—and that future staffing requirements would be reviewed as the board's work developed. That was the same day as I was told that the expenditure would not be more than £35,000. Last week I was told that already the board is employing 14 people.
I am delighted to see that the Leader of the House has just entered the Chamber, because he was Minister of Agriculture when we passed the Bill setting up these regional development boards. I am alarmed that within four months the costs of the board have escalated by 30 per cent. and the size of the staff has escalated by about 75 per cent. That is very worrying. If the board continues to operate in this way it will become the bureaucratic extravagance which has been feared.
We want worthwhile jobs created in the area. I have made a plea in Committee on the Agriculture Bill that the headquarters of the Egg Authority should be set up in Cumberland or Westmorland, and I am sure that I shall have the support of the hon. Member for Carlisle (Mr. Ron Lewis) in pressing that the headquarters of the Egg Authority should be placed in this area.
I want to refer to the relations between Westmorland and the Northern Economic Planning Council and ask whether this has been a valuable association for the area. In correspondence with Mr. Smith I asked him to what extent he thought his council had been valuable to my constituency. He rightly pointed out that the planning council was an advisory body without executive functions, the fact which I had recognised. He also pointed out that in the period since the council was set up the headquarters of the rural development board had been placed in Westmorland. It is an open secret that originally it was intended that these headquarters should be in Barnard Castle or Richmond and that it was only the pressure of the local authorities in Westmorland and other organisations which led to the headquarters being placed in Westmorland. The original intention of the board had been to go to North Yorkshire.
Mr. Smith also said that an advance factory had been planned for Kirkby Stephen. I know something about that matter, and I believe that the fact that the advance factory was promised is entirely to the credit of Westmorland County Council, which did wonderful work in that respect. Mr. Smith also made other points about development area status and the S.E.T. rebate for hotels, among others, but I am afraid that I do not believe that the existence of the Northern Economic Planning Council has materially altered the situation. I suspect that even if the Council had never been set up, and if Government policy had continued in its present form, the situation would not have been altered materially and we should have had these concessions and advantages without the assistance of the Northern Economic Planning Council. Of course, without the council we should miss its glossy publications about golf courses, for example, which shower upon us in our mail.
I have not heard that Mr. Smith or the leading officials of the council have visited Westmorland very often. Perhaps they have done so and I have not heard of it, but I suspect that they do not visit Westmorland very often. One leading member, who comes from Cumberland, left membership of the council a few months ago. I suspect that he found that he had rather more important jobs to do elsewhere. Nor have I heard that the local authorities in Westmorland regard the planning council as a Delphic Oracle or father confessor. They tend to regard it as another body with which they sometimes correspond, but they go on in much the same way as for many years past. I concede that the situation might be slightly different on the North-East coast, but I suspect that for Westmorland the Northern Economic Planning Council is something of an irrelevance.
One of the basic difficulties arose from a decision in 1964 to put Cumberland and Westmorland in the Newcastle region. Under the previous Government they went with Lancashire and Northwest England. I agree that this is a fine and difficult decision to make, but Maud got it more nearly right in his report in suggesting that a provincial area stretching from Lancashire up to the Scottish Border was more in keeping with communications and social movements. Few people in my constituency go to Newcastle or the North-East, and there is little cultural or social exchange between the areas. Much more often people travel North-South. This is possibly one reason why Cumberland and Westmorland are largely detached from the northern economic planning area and why they regard it, as I do, as something of an irrelevance.
The hon. Member for Westmorland (Mr. Jopling) will, I hope, forgive me if I do not follow his arguments, because I want to return straight away to the problems of the North-East and of Tyneside, in particular.
I was interested in the observations of the hon. Lady the Member for Tyne-mouth (Dame Irene Ward) on the question of unemployment. It was particularly significant that she adopted a far more responsible attitude to the question of unemployment in the North-East than did her hon. Friends the Members for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) and Berwick-upon-Tweed (Viscount Lambton). She knows that the unemployment is caused by the rapid decline in the traditional industries of mining, shipbuilding and heavy engineering.
As my hon. Friend the Member for Consett (Mr. David Watkins) said, in the last nine years over 100,000 jobs have been lost in the basic industries. That is the problem. It has existed in the North-East for a long time, and it has faced both Labour and Conservative Governments. The difference between Labour and Conservative Governments is that the Labour Government have tackled some of the problems arising from unemployment with the Redundancy Payments Act. They have eased the burdens which fall on a family when the breadwinner is out of work, and they have also introduced earnings related benefits—another great assistance in tackling the unemployment problem which has been with the North-East for a long time. According to the Northern Economic Planning Council, the problem will be with us for a few more years because it estimates that the basic industries will continue to decline until about 1975–76.
The trouble is that, although the Government have been highly successful in attracting new firms and new industries to the area, they have not been attracted in sufficient numbers to keep pace with the decline in the basic industries, and as a consequence, I regret to say, unemployment in the area is marginally higher today than it has been for a long time. We must therefore consider the whole problem of how we are to attract more industries and more firms to the North-East.
Reading the other day about industrial development certificates, I found that 56·4 per cent. of these certificates issued in the financial year 1968–69 were granted to firms outside the development areas. If the Government's regional planning and regional policies mean anything, they must mean stricter control being exercised over the industrial development certificates. More stringent efforts should be made to ensure that a higher proportion of the certificates issued are issued conditionally upon the firm concerned establishing itself within a development area.
Last week, I was speaking to an industrialist who explained to me his labour problems. His factory is at Thames Ditton. He said that the difficulties of obtaining labour were such that he was transferring all the establishment. I naturally, but mistakenly, thought that it would be transferred to a development area, where all the Government's financial inducements would apply. But this gentleman informed me that he was merely transferring it to Ipswich, where these inducements would not apply.
When I said that he seemed to be adopting an unwise policy, he said, "We must be near our customers. We are connected with the electronics industry, and our customers are in the South-East". If this is the case, there is a very good argument here for ensuring that complete industries, or major sections of them, are transferred to the development areas, so that the related industries will be attracted there as well. I should be grateful if my hon. Friend the Minister of State will consider that point.
But there may be other reasons why industrialists are not too enthusiastic about going to development areas. In the South particularly I find a great deal of misconception about the North-East. People think that it is an area of pit heaps, that it is depressed and unexciting. How wrong can they be? The North-East has the most beautiful countryside in the country. Its coast line is generally admired. The people are hard-working, willing, friendly and warm. These are the attractions of the North-East. If industrialists decide to invest their capital there, they will find it a worthwhile investment.
But it would be idle to deny that there are scars in the industrial concentrations of the North-East. There are pit heaps, of course, but they are being removed. Indeed, the Government's Industrial Development Act of 1966 is providing extremely generous grants for this purpose. They pay 85 per cent. to local authorities for this work. However, many local authorities, because they have limited financial resources, or because their available resources are earmarked for other works, cannot find the 15 per cent. margin for this essential work. I wonder whether it might not be worth while, in order to improve the environment in the North-East, for the Government themselves to take over responsibility for this vital work and pay the whole cost.
I always welcome these debates on the economic situation in the Northern region. Sometimes, there is a danger that we may overstate our case and, in explaining our problems and seeking solutions, give the impression that the area is depressed and unexciting. If we do that, we are failing to put over our message. The message is that the North-East is exciting, its people are warm and friendly, there are beautiful national parks around, and anyone who decides to establish a firm there will find it a worthwhile enterprise and an enjoyable experience.
I should like to add my congratulations to my hon. Friend the Member for Consett (Mr. David Watkins) on selecting this subject and on his altruistic brevity, which I hope to follow.
I want to concentrate on the state of the building industry, which is one of the industries in the North which has had a boom, but at present all is not well. There is considerable unemployment in the industry in the North. It represents about a quarter of all the registered unemployed there—about 11,000 men unemployed in the summer and about 15,000 in the winter, at a moment when the industry is not doing particularly well. In 1968 the same sort of percentage obtained when the industry was doing very well.
This unemployment is twice the rate of the building industry nationally. I should like to draw my hon. Friend's attention to some of the problems. There is something wrong with the structure of the industry in the North. It should be helping to create jobs and not have this high unemployment. It should be used to the full for building up the whole structure of the region, as many of my hon. Friends have said.
Perhaps I might point out what I think is wrong. In the first place, the placing of council house contracts in the first nine months of this year have slumped badly; they also slumped absolutely and as a proportion of the national contracts placed for council house building. The figures for the first quarter of 1969 show contracts placed for £14½ million, compared with £29 million in 1968 and £30 million in 1967. Proportionately out of the national allocation, this is the lowest for three years. It is 4·8 per cent. of the country's allocation, compared with 5·8 per cent. in 1967 and 1968 and 5·4 per cent. in 1966.
I would request my hon. Friend to ask his colleagues in the Ministry of Housing and Local Government to consider two things. Is the national allocation wrong? In other words, are too few council houses being made available? Is insufficient provision being made for the local councils? Or are the councils themselves falling down in placing their contracts? It is obvious that if the council house contracts were running as they have run in the past they would be helping to deal with the unemployment to which I have referred. No one can say that council houses are not needed. Almost every speaker in this debate has referred, or could have referred, to this aspect of the region's problems
In other fields of public spending the impetus for the placing of contracts and public building has kept up. In education, roads, and factories the figure for the first nine months of 1969 is £66½ million, much the same as in 1967 and 1968 and much higher than in 1966. Private housing has been running at a considerable level—£25 million in 1969 and much the same in 1966, 1967 and 1968. Therefore, the extra number of mortgages which are available nationally will not have the same profound effect on the house building industry in the North as will a greater allocation and a greater speeding up of the placing of contracts for council houses.
Industrial building has been well maintained: it ran at about £35 million a year over the years to which I have referred. Other building, commercial building and so on, has been running at about £15 million. But there is great concern in the area about the number of building contracts going to contractors outside the area. This is especially true of roads. I am glad that the constituency of the hon. Member for Westmorland (Mr. Jopling) is getting the benefit of the road contracts and other building activities, but it is certain that some of the areas, although the sub-contracts go to local contractors, are not getting the full benefits of the road contracts.
It is also probably true that the public investing sector—that is, the English Industrial Estates Corporation, which places nearly all its contracts locally— is doing much better than private industry. The Ministry of Public Building and Works has instituted a fact-finding investigation by civil servants to find out the position. I hope that when that report is published in a few days' time action will follow.
My own suggestions are as follows. When industrial development certificates are to be issued in the private sector, I suggest that the Ministry of Technology should write to the developer pointing out the necessity of inviting tenders from local contractors and, wherever possible, giving the work to local building and construction firms. I suggest that if this does not work, and if in the next six months there is no evidence to show that more contracts are going to local contractors, then the Distribution of Industry Act should be amended to make it compulsory to employ local contractors. Indeed, if there were not a monopoly by the party opposite of Ten-Minute Rule Bills, I should like to sponsor a Ten-Minute Rule Bill to bring about that Amendment, no doubt with Government facilities.
Secondly, I suggest that in cases where building contracts have gone outside the region the Ministry of Public Building and Works should find out why this has happened. Generally speaking, I suspect it has happened because public authorities are not using to the full negotiated contracts and selective tendering. In my own constituency I was disappointed that the Ministry of Public Building and Works, in placing a contract for a Crown building, did not even ask the biggest local building firm in the area to tender. It is true that the contract went to a national firm with local branches but it was wrong that a local firm on the Ministry's list whose works was less than a mile from the site was not asked to tender.
Thirdly, I suggest that the selective employment tax should be used in a flexible manner for the benefit of the Northern Region and should be employed as a regional premium in the building industry. In my opinion, the building industry in the development areas should be treated as a manufacturing industry. If this is too much for the Government to agree to, I suggest that the Government should look at areas in which encouragement is needed, such as in the increase of "winter building", the need for more apprentices, and relax S.E.T. in those areas.
Fourthly, I suggest that the structure of the building and contracting industry in the North-East needs to be reformed. There are probably too many small firms, not enough large firms, and not enough specialist firms. I suggest that the trade unions, the employers' organisations and the Ministry of Public Building and Works should get together to see what is required. They could perhaps call in the I.R.C. to see whether any financial or structural alterations are needed. This is particularly true of the Housing Act, 1969, which will concentrate attention on improvement of old houses and on getting small firms to amalgamate and form themselves into consortia to cope with these activities. Finally, I suggest that in the North and in other development areas exceptions could be made to the credit squeeze, and that bank credit could be made much more easily available in the North for builders.
It is important for a building and contracting firm in the North to maintain a steady flow of contracts. It is all very well to say that the outside contractors who are employed can employ local labour and use local materials, but it is essential that the profitability of local firms should be ploughed back into the local area since this is not always the case when contractors are employed from outside. It is also essential to ensure that workers in the area should enjoy stability and promotion prospects. This again tends to be denied to them if the contracts go to outside firms.
I hope that the Minister of State in his reply will address himself to some of these matters to see what can be done.
The debate on the economy of the Northern region has been exceptionally wide-ranging. I join with other hon. Members in thanking my hon. Friend the Member for Consett (Mr. David Watkins) for his choice of subject and I support the terms of his Motion. It would be easy, and indeed tempting, to make comparisons between the efforts and activities of respective Governments in this matter. There has been a unique opportunity over the past nine or ten years to watch how one Government or another deal with the problems which have arisen.
The great tribute by my hon. Friend the Member for Consett in the opening phrase of the Motion dealing with the remarkable economic progress is best reflected in the experience of people who in the early 1960s in most of the areas in the North, and particularly in the southeast of Northumberland, saw only despair lying ahead of them in the form of the amount of unemployment that existed. It is only when one starts to make comparisons of this kind that one realises the tremendous step forward which has been taken.
Some of my hon. Friends have rightly laid emphasis on the fact that our problems are by no means over. I feel that we have merely laid the foundations on which to build in the future. We should strive to see that the targets are not only achieved but maintained.
I should like to raise three particular items at this late stage of the debate. Every possible inducement has been offered to industrialists and there has been an exceptional effort in regard to the provision of finance. The figures need no repetition. We were faced with a massive rundown of our major industries. In face of that situation, it was the Government's task to deal with the situation.
I come back to the original point which many of us have made over a number of years. Where inducements to private enterprise in the Northern Region have failed to bring about the required results, the Government in the coming months will need to look again at the question of the direction of industry. I know that many hon. Members on both sides of the House will raise their hands in horror at this suggestion. They counter it by saying that direction of industry is bound to be followed by direction of labour. I do not think that necessarily follows since in the under-employed areas of Britain there is already a measure of direction of labour.
Every time one of my constituents goes to a coalfield in the Midlands, or buys a single ticket from Newcastle to one of the over-employed areas of the country, he is being directed by the force of economic circumstance. Therefore, it is not on the one hand an argument about direction of labour and on the other hand of direction of industry. We already have direction of labour. We need to have direction of industry to complete the basic attack on the imbalance of employment between one part of the country and another.
In my view we should forget what has happened in the past. We should cut out all the arguments and comparisons with what has taken place in the regions and now concentrate on this vital factor.
Hon. Members have given the figures to show the loss of jobs and the number of jobs needed to tackle the high unemployment rate which we still have. In considering our strategy for the future, the direction of industry has to be high on our list of priorities. We have rightly argued, as we did in the 1964 and 1966 General Election campaigns, for publicly-owned industries. This is what we mean by the direction of industry—the injection of publicly-owned industries into South-East Northumberland and the other areas of the region.
It is clear that an intensified examination of this aspect of regional development has to take place at Government level so that we have not only an expansion of industry in the region and not only the attraction of industry but a diversification of industry similar to that in expanding areas, so that we may have a balance of employment for a long period ahead. We must look, as we are bound to look in a debate of this kind, at not merely the problem which arose in the 'sixties but the continuing problem of the post-war years, the change in the type of industries available for us in the development districts and the change of character of industry itself. Some complaint has been made that we attracted to the North-East too many industries which are capital intensive, but we have to face the fact that industry, particularly expanding industry, is much more capital intensive than labour intensive at the moment. That makes it all the more necessary to have detailed planning to get the solution to the problems of the region.
That solution is not contained merely in Ministerial briefs about the number of jobs in the pipeline or the number of jobs which have been provided, important though that is and success story though that is. The real test of our measures for the Northern Region will be finally told only when we can tell the people we represent that full employment in the Northern Region has not only arrived but is here to stay.
I add my congratulations to my hon. Friend the Member for Consett (Mr. David Watkins) on having initiated the debate. This is the first occasion for 18 months that we have debated the problems of the North-East, the last occasion being when my hon. Friend the Member for Wallsend (Mr. Garrett) introduced a similar debate. My right hon. Friend the Leader of the House has just left—
There was a debate, albeit short, which was initiated by my hon. Friend the Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) on the same subject only a few months ago.
The point is that we should not have to wait for the luck of the draw in the Ballot. As a matter of right, we should be able to ask the Leader of the House to provide time for us to debate this important subject.
It has been a wide-ranging debate. It concerns the problem of the 100,000 jobs which have disappeared in the last 10 years because of the run-down in the coal mining industry and the contraction of the shipbuilding and railway industries. We know the answer to the problem. It is to provide 25,000 new jobs in the Northern Region every year for the next five years.
I do not for a moment underestimate the Government's efforts to attract new industries to the region, but the fact remains that our unemployment is still twice the national average. That is why I endorse what was said by my hon. Friend the Member for Blyth (Mr. Milne) and my right hon. Friend the Member for Sunderland, North (Mr. Willey) about publicly-financed industries in the North.
We have to make provision for public utilities, the pharmaceutical industry and the telecommunications industry and so on There is no reason why the Government, having failed to attract private industry to unoccupied Government-built factories, should not turn their attention to letting these factories to public corporations to produce goods for public utilities. This would be an answer to our problems, although not an immediate answer, because it would take a year or two to get it off the ground.
However, there are things that the Government can do immediately to attract industry to the region. For instance, trade union officials in the building industry say that £70 million worth of contracting work inside the region goes to firms from outside it. The figure may be exaggerated, but I hope that the Government will investigate this. I do not believe that we in the Northern Region can live by taking in each other's washing, but some portion of the £70 million worth of construction work could be allocated to firms within the region.
The Government ought to do more to steel orders from the nationalised industries into the Northern Region. For example, I understand that the South of Scotland Electricity Generating Board has asked for quotations for the Inverskip power station and that the Nuclear Power Group in my area has made a tender. I understand that a decision is to be made shortly. I have a constituency interest in the group, which is composed of the Whessoe Company from Darlington, Head-Wrightsons from Tees-side and Clarke-Chapman from Gateshead.
The Government may say that they will stand on the side-lines and that whoever submits the lowest tender will get the job. But social factors as well as economic considerations must be taken into account in this situation. A tender from a group in the North-East may be marginally higher than one from outside, but we have to remember that a social consequence of work not going to the North-East might be that people would not be able to work and the State would then be paying out in other directions, in unemployment pay, social security benefits and so on. It is up to the Government to say that not only commercial considerations should weigh in a matter of this kind. They should attempt to nudge a nationalised industry into accepting a tender on the basis of social and economic as well as commercial considerations.
We have experienced this in other respects. The Steel Board located a headquarters in Scotland when we had a particularly good case for its location on Tees-side. I hope that the Government will actively intervene when massive orders of this description, running into millions of pounds, are put to tender. I hope that they will say that socially it is essential that jobs should be secured in the North-East, even though commercial considerations are against it.
I support the Motion. We thank the Government for what they have done, but our job is to nudge and press them into doing even better. I believe that as a result of the debate the Government are better informed of our point of view and will be encouraged to do even more to bring more employment to the region. We cannot in any circumstances be satisfied when unemployment in the region is twice the national average. Unemployment is the barometer of economic health and when the Government have finally reduced our unemployment to the national average, we shall be able to say that they have done a good job.
I am grateful to the hon. Member for Darlington (Mr. Ted Fletcher) for allowing me to rise on time in this short debate.
I am also grateful, as we all are, to the hon. Member for Consett (Mr. David Watkins) for moving the Motion, but I am bound to agree with my hon. Friend the Member for Tynemouth (Dame Irene Ward), after hearing the praise she gave the Government and later the many criticisms expressed on both sides, that the terms of the Motion are too fulsome. However, hon. Members on both sides have not worried too much about its terms, but have looked at the problems it has given us a chance to consider.
It is true, as some hon. Members have already said, that the debate could have developed in two directions. It could have gone along simple party political lines, each side swapping facts and figures merely to show its own regord to the best advantage, and doing its best to damn the other's efforts at providing help to overcome the serious problem that faces the region.
I am glad, like every other hon. Member, that not only did the hon. Member for Consett initiate the debate, but that he set the tone, which was followed by succeeding speakers, of not seeking to develop it along that simple but sterile line. Instead, we have had a constructive debate which has brought out the many problems and difficulties facing a most important region.
As has been said many times, it is a region with serious problems, problems of old industries, of service industries that need renewal, of placing new industries in the area in sufficient quantities, and of providing the social structure that must exist to support a rapidly expanding industrial complex. These problems are not unique, but they are unusual in their size and in their effect on the local economy.
In particular, there is the pressing problem of the declining industries, particularly coal mining, where employment has shrunk from 143,000 in 1957 to about 58,400 in 1968, and is dropping still lower. There is also in parts the legacy of the very success the area made in taking such a prominent lead in the Industrial Revolution, which has left a great and urgent need for urban renewal. In other parts, as several hon. Members have said, there is the problem of distance, of isolation and inadequate communications. This was very well stressed by my hon. Friend the Member for Westmorland (Mr. Jopling) and was also brought out very well by the hon. Member for Carlisle (Mr. Ron Lewis), particularly when he referred to the problem of Millom and the closure of the Cumberland pits.
In discussing this problem, we would be wrong not to remind ourselves of the work done by my right hon. and learned Friend the Member for St. Marylebone (Mr. Hogg). He it was who laid the foundations for the progress made under both Conservative and Labour Governments. Towards the end of 1963 he brought out his White Paper. Unemployment in the North-East Region was then up to 5 per cent. By 1964 it had dropped to 3·4 per cent., and in 1965, for which he can still claim credit, it had dropped to 2·6 per cent. Since then—and I am not trying to make a parliamentary point —average unemployment has risen to 4·8 per cent., the figure in November this year.
During the first five years of the Local Employment Acts—up to March, 1965— the region had the largest share of additional jobs expected to arise from the new industrial buildings then going up. It was my right hon. and learned Friend who initiated the growth zones—particularly in Tyneside, Teesside and Durham —more advance factories, more roads, the new town of Washington, and more reclamation of derelict sites; and he encouraged the further expansion of industrial training.
The present Government expanded on the foundations that my right hon. and learned Friend had laid when they came to power in 1964. They sought to extend the help given to the development areas, particularly after 1966, when the development areas in their present form came into being. Yet it is clear to us all that much more needs to be done. Unemployment in the region is nearly twice what it was in 1966–4·8 per cent. instead of 2·6 per cent. As my hon. Friend the Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) said, with 6 per cent. of the national population it has 10 per cent. of its unemployment.
In my constituency of Scarborough and Whitby unemployment is now running at 5.6 per cent. instead of the 4·4 per cent. in 1966, and in Whitby it is 10·4 per cent. instead of 5·5 per cent. Let us consider the bigger conurbations. In Tyneside, there are now nearly 22,000 unemployed compared with 10,000 in 1966. Teesside has a similar story, with over 8,000 now unemployed as against nearly 4,000 in 1966. The figures show that in spite of all the help that has already been given the problem remains, and the harsh fact is that in March of this year there were 66,000 fewer people employed in the Northern Region than in March, 1966.
In part, the problem is one of modernisation. An example is the shipbuilding industry on the North-East Coast. Help has been given, but we have not heard sufficient, except from my hon. Friend the Member for Tynemouth, about the efforts it has itself made in restructuring its organisation and in modernisation.
The right hon. Member for Sunderland, North (Mr. Willey) referred to shipbuilding in his constituency. It is curious that there was an article today on one of the firms in that area in the Yorkshire Post, which showed clearly that the improvement and success which has taken place in the yard concerned was due almost entirely to the remarkable efforts of both management and men in the provision of a new Liberty ship and the outstanding success which they have achieved in selling it competitively in markets abroad.
In many other cases the need has been, not to modernise and renew old and existing industries, but to attract in ever increasing numbers new industries into the area to replace industries such as coal mining and certain branches of the metal working industry. Nowhere in the development areas is this need more urgent than in the northern development area. New jobs calling for a wide range of ability and qualification are required if the drift from the region is to be halted.
I stress the need for new jobs for young men and women of ability, for it is a sad thing for a town—and I have seen it in my constituency, particularly in Whitby— when its most promising youngsters have to leave the district to make their careers elsewhere, often returning at the latter end of their years to retire in the place where they were born and brought up. This is a tragedy and it cannot be for the health of any town.
Both sides of the House agree on the urgent need to help the development areas. My right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) made our position clear at Brighton on 10th October this year when he said:
We shall keep the development areas as they are at present defined and we shall make no alterations in boundaries unless and until in any particular case we are satisfied that immediate problems have been overcome and a firm foundation for future prosperity has been established.
But that does not commit us, when we return to power, to giving the help in precisely the same way that help is being given to areas by the Government. If one thing is clear, it is that the mere spending of more money is not the answer.
During the last year or so we have probed the Government to see what evidence they can provide about the effectiveness of the large sums of money which they have paid in grants, R.E.P., and so on, in the provision of new investment and jobs. This point was well taken by my hon. Friend the Member for Newcastle-upon-Tyne, North. It is interesting to note that apparently—whether because of our probing I do not know—the new Ministry of Technology is investigating this matter, as disclosed in an article in The Times Business News today.
The article goes on to say:
The newly expanded Min. Tech., with full Treasury backing, wants to take a new look at the whole cost-effectiveness of Government aid to industry. It wants particularly to see
whether the sharply rising amount spent on investment grants is having a proportionate effect in raising the level of manufacturing investment or if the money could be used with more discrimination".
That is precisely the sort of investigation which we have been seeking for many months because we believe that it is on the answers which such an investigation will disclose that we—and, I hope, the Government if they get the answer before the next election—shall be in a much better position to try to ensure that the money spent in these areas is spent to good and useful purpose in providing new jobs and repairing the social structure which goes with them.
Curiously enough, the same article talks about the Government coming round to our view which we have always expressed that investment allowances are less expensive and more effective than investment grants. Alas, it seems to indicate that the Government will not have the courage to admit their error and to be converted back to the old system. I trust that they will not be deterred. If they come to the conclusion that investment allowances are better, we shall assist them in correcting their mistakes.
Our approach must be to ensure that every penny spent—and, my goodness, the sums being spent are large—goes towards creating the maximum number of jobs and to restoring an expanding and healthy prosperity to the area. When we return to power our emphasis will swing increasingly towards creating the conditions which will attract new industry to the area. In this, good communications are vital. Much has been done—and I give the Government credit for it—but much more needs to be done. For example, Teesside still lacks a good link with the Al, which is vital to its industries and to the expansion of its port. The bottleneck at Malton is not only a deterrent to the holiday traffic flowing to and from Scarborough and Whitby, but hinders the movement of goods from the small but busy harbours of those two towns.
There is need for a variety of jobs, and, again, the Government can play their part. It was a great disappointment to the region that the Government decided to locate the new British Steel Corporation headquarters in Glasgow instead of at Teesside. I hope that in deciding the future location of any Government office or centre the claims of the Northern area will be given special attention by the Government.
While we have accepted the present boundaries of the area in the terms laid down by my right hon. Friend, it is clear that the pattern of help will develop very much in line with the growth centre concept which we followed when in office. Had there been time, I would have shown that in "Outline Strategy for the North", the council indicates that there should be concentration on areas of major growth. Similarly, the same pattern of thinking is revealed in the Hunt Report—a concentration on areas where growth is most likely to succeed.
But, above all, whatever new services are provided, whatever the grants and allowances, the overriding need in the area is for an expanding national economy. Industrialists will not expand or risk fresh capital or train and take on new staff unless they see a market for the goods and services which such expansion will produce. The Government's regional planning machinery was set up to work within the framework of a long-term national economic plan. But we all know what happened to that plan. It is dead and long since buried. But the ingredient in it so vital to the health of the regions was that the national economy should expand by 25 per cent. in the six years to 1970. In fact, it seems likely to expand by only 14—½ per cent. That is the key to the failure to solve the unemployment problem in the area. What is needed is a greater and more rapid expansion of the national economy.
With better communications, with help to remove the industrial scars of former days, with educational and training facilities to deal with new industrial and commercial needs, with help and encouragement in attracting new industries to the area and with national confidence in the sustained expansion of our economy, the North can and will become once more a prosperous and vigorous community.
I would like to join those of my right hon. and hon. Friends who have paid tribute to my hon. Friend the Member for Consett (Mr. David Watkins) for the manner in which he introduced his Motion this afternoon and for the way in which he made his presentation to the House. As one could immediately appreciate, my hon. Friend brought to our minds what the aims of regional policy are.
The Motion rightly emphasises the need for an expanding economy in the Northern Region. Expansion of the national economy, and, in particular, expansion in the development areas, is a fundamental aim of regional economic policy, not the more negative one of attempting simply to shore up areas with the most severe employment problems. The Government's regional policies are consistently directed at achieving a fairer distribution of economic activity throughout the country, at stimulating growth and at bringing into the fullest use possible under-utilised resources of the less prosperous parts of the country. This is not only in the interests of these areas and of the people who live there, but is ultimately to the economic advantage of the nation as a whole.
The hon. Member for Westmorland (Mr. Jopling) spent some time in maligning the Northern Regional Economic Planning Council. I would like to advise him that the council, in common with the rest of the economic planning councils, has done a valuable service since it was set up in 1965, despite the titters of right hon. and hon. Members opposite, who never believed in regional planning of any kind. They can be expected to titter when they hear about economic planning and planning councils.
Nevertheless, the report "Outline Strategy for the North", published by the council earlier this year, to which the Government a few days ago sent their reply, which will be made public today, sets out the council's views on how the region should be encouraged to develop between now and 1981. The report also recognises the changing emphasis of regional policy from the more negative prevention of decay to a positive encouragement of growth—the broad development areas were created to replace the smaller and more scattered development districts which were a concept of the party opposite.
In addressing ourselves to the amount of Government incentives available to the development areas and the fact that the total has now risen to £270 million in the last financial year, one also appreciates the extent of this contribution to the Northern Region. Compared with the somewhat miserly £40 million in 1964–65, this has risen in the last financial year to £75 million for the Northern Region alone. This represents only the preferential assistance which the Government vouchsafe to the development areas. The corresponding total to the region in 1964–65, under a Conservative Government, was £15 million.
Nevertheless, there have been some criticisms recently, and again this evening, of the form and content of the financial assistance to development areas, particularly concerning the regional employment premium and the 40 per cent. preferential rate of investment grant. It has again been suggested that the application of these policies has been on far too much of a broad-brush basis and that they involve needless expense and the spending of more money than is strictly necessary for the new jobs created.
The first point to be made is that these two measures preferential investment grants and regional employment premium —are complementary in that one assists with capital, the other with labour costs. In combination, therefore, they are designed to attract, or in some cases to retain, both capital-intensive and labour-intensive industry for development areas. Secondly, both of these two forms of financial incentive help to raise the efficiency and competitiveness of industry. Increased industrial efficiency is vital to the future welfare of the areas and, by way of increased productivity, generates a higher level of prosperity and security for the individual and the region.
However, this is not to claim—and I, too, read The Times this morning—that the perfect balance of incentives and of assistance to industry has been struck. Some of the measures have not been in existence long enough for their impact to be precisely identified or their effectiveness fully measured. Their operation needs to be monitored very closely, and the review of the effectiveness of investment grants which is being undertaken by the Ministry of Technology will be one instrument for this purpose.
There has been reference to the selective employment premium and, perhaps, a little confusion in the debate about what has been the effect of the withdrawal of the premium from the development areas from 1970–71 to fund the new intermediate areas. This was the most simple of the measures applied to the development areas to withdraw. Despite its withdrawal, it still leaves the development areas with a massive preferential, especially in the form of R.E.P. of 30s. a week and the 20 per cent. differential rate of investment grant. The retention of these things should safeguard very considerably the development areas against the problems which could be created as the result of the classification of intermediate areas.
A good deal has been said during the debate about what regional policies are achieving for the Northern Economic Planning Region. I must point out, first, that it was not until 1966, under the present Government, that the whole of the Northern Region was made a development area, and in November, 1967, further stimulus was given to industrial development in parts of the development area likely to be particularly severely affected by pit closures, by giving the employment exchange areas concerned special development area status, carrying with it additional incentives to incoming industry.
My colleagues have been concerned about industrial development certificates and the policy. A very rigorous I.D.C. policy is applied by the Ministry of Technology, as previously was applied by the Board of Trade, to areas outside the development areas. The net result has been that the area of factory space covered by I.D.C. approvals in the North in 1968–11·9 million sq. ft.—was the highest since the industrial development policy was introduced in 1948. I.D.C. approvals since 1964 represent an average per year of some 20,000 new jobs in manufacturing industry over this period of five years. This makes no allowance for the increase in other fields of employment.
The measure of success of the policy is also to be found in the fact that since the beginning of 1966 more than 160 firms new to the region have established or taken the decision to establish projects in the North. By comparison with the record of right hon. and hon. Members opposite when they were in office, the advance factory programme has been accelerated by the Government and, in all, 60 advance factories have been approved for the region since 1964, the latest at Brandon last week under the "rolling" programme for the special development areas approved in 1967.
The number of advance factories announced this year alone stands at 18, which is two more than the total approved during the whole period from 1960 to 1964. Forty-seven of these factories have been let and only two completed advance factories have not yet been allocated to industrialists.
With the special emphasis on new industrial development, one tends to forget the part that the old industries can still continue to play in the regional economy. Despite massive reductions in employment opportunities, coal mining will, when the modernisation and rationalisation programmes have been completed, become more economically viable and will continue to play for a long time to come a predominant part among the fuel industries.
The British Steel Corporation's decision to build a high-capacity oxygen-steel making plant at Lackenby and the proposal to develop a major ore-terminal at Redcar is evidence of the continuing importance of the Northern steel industry to the regional, and national, economy.
As to the outlook for shipping, shipyards in the Northern Region are to be congratulated on their good order books, on such achievements as the successful lines of standard vessels developed on the Wear and the number of ships which, in the last year or so, have been delivered ahead of time. This has been outstanding, as the hon. Lady the Member for Tynemouth (Dame Irene Ward) pointed out. A considerable degree of reorganisation has taken place and is continuing. There has been a marked improvement in industrial relations in the industry.
The future of the industry obviously depends on its future competitiveness in the world shipbuilding markets. There is still much to be done in applying modern techniques but, with the help of Government assistance under the Shipbuilding Industry Act, a good start has been made in the Northern Region, if it is not fair to say that the industry has been rescued. My right hon. Friend the Member for Sunderland, North (Mr. Willey) is entitled to be proud of the part that the industry plays in terms of employment not only in Sunderland, but over a much wider area.
Would not the hon. Gentleman agree that the performance of the shipbuilding industry in Sunderland, which has been particularly successful, has been achieved with minimal Government assistance and without interference or restructuring from the Government?
I was speaking of Government assistance generally. I agree that in the merger at Sunderland neither firm has, as yet, made application for Government assistance. However, if one looks at the record generally one finds that the Northern shipyards have benefited very considerably from Government assistance. Indeed, had it not been for the £1 million which the Government invested in Fur-ness the unemployment figures for that area—for Hartlepools and Teesside— would have been substantially higher.
I will not give way. I was left less than 20 minutes in which to reply to the many questions that were put to me. On another occasion I would be only too pleased to discuss this matter at length with the hon. Gentleman.
Many questions were asked about training. A new Government training centre was opened at Meadowfield only a fortnight ago and the annual output of trainees from training centres in the region is now well over 2,000 a year. Generous grants are available to new and expanding firms towards the cost of training labour, as well as grants towards the cost of machinery and equipment purchased by industry for use in training bays or centres. The Government are also stimulating improvement through industrial liaison centres established by the Ministry of Technology and I was able to announce last Friday the establishment of a marine industries unit based on Newcastle University.
A considerable amount of comment has been made in the debate about the tremendous improvement that has been taking place in communications in the Northern Region. One may be excused if one takes pride in the amount of capital investment that has been put into, for example, motorways. We have the Durham Motorway, the Tyne Tunnel and the Penrith By-Pass all completed. Work which, altogether will cost £43 million is in progress on the A19. A new spine road is being built through the Northumberland coalfield. Work is in progress on 50 miles of the M6 in the western part of the region and Workington and West Cumberland will soon have a good road link with the motorway at Penrith.
We are concerned not only with roads. I remind the House that when we speak of consolidation and the need to provide a background for further economic development in the region we have in mind public expenditure on houses and schools as well as other essential social services. While over the four financial years 1965–66 and 1968–69 inclusive public expenditure on new construction in the United Kingdom as a whole rose by about one third, it doubled in the Northern Region. In no other region did the rate of public expenditure on new construction grow at so high a rate. Compared with 1965–66, expenditure has risen from £83 million to £160·6 million, and this expenditure includes increased investment in many spheres, including roads, dwellings, education, hospitals and environmental services.
My hon. Friend the Member for Gateshead, East (Mr. Conlan) referred to the clearance of dereliction and the need to improve environment. It is worth mentioning that 85 per cent. grants are available towards the cost of derelict land reclamation schemes in the Northern development area and that this has led to an upsurge in clearance activity in the region. These rapid strides in reclamation and clearance are being made with the full co-operation of local authorities. When hon. Gentlemen opposite talk about regional policies, they should bear in mind the vivid comparison that can be made between their policy, which included the withdrawal of the payment of grant for clearance of dereliction between the whole period 1951 to 1959.
The hon. Member for Scarborough, Whitley (Mr. Michael Shaw) asked me to note that the debate had been conducted on an amicable footing and that acrimony had not crept in. Evidently, the hon. Gentleman did not hear the speech of his hon. Friend the Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) who, speaking early in the debate from the benches opposite, made a forthright contribution about the feeling that existed over Government policy towards regional economic planning, with special reference to the Northern region.
If the right hon. Gentleman agrees with that, then I remind him of what he said in January of this year about regional economic policy and its application specifically in Sunderland. Questioned by Conservative councillors in Sunderland about what the Conservatives would do if they were returned to power—it will be a long time before we have another Conservative Government— the right hon. Gentleman is reported as having answered this question from a councillor:
… but the unemployment situation in the town is no different from what it was in 1963. Can you assure us that confidence will return this time, as it did not in 1963?
The party has learned from its mistakes".
Has the right hon. Gentleman learned from his mistakes?
They were not as big as the right hon. Gentleman's.
For example the Conservatives did not appreciate the world competition in shipbuilding or the run-down in the coal trade. Indeed, the right hon. Gentleman is reported on the occasion to which I referred as having said that a short period in opposition each generation or so could be a healthy thing for a party; that is, so long as it was not too long because it was possible for its members to take a detached view of the situation.
The Conservatives forgot to plan for the school-leaving age bulge that would arise after the 1950s. That led to the high rate of unemployment among school leavers in 1963. Fortunately, we do not have as high a rate of unemployment among this group now. Despite anguished pleas from youth employment committees and local authorities throughout the Northern Region, nothing was done. The right hon. Gentleman belongs to a party which abolished dereliction grants for the whole period 1951-59 and scarcely laid a brick on industrial estates in the Northern Region between 1951 and 1964.
Despite all this, hon. Gentlemen opposite tell us that they will not vary the development areas if and when they are returned to office. They did nothing to stimulate economic development in the Northern Region and when the hon Member for Scarborough and Whitley refers to his right hon and learned Friend the Member for St. Marylebone (Mr. Hogg) having been sent to the Northern Region to see the full effects of the situation— he was, of course, sent far to late in the day—we should remember that he prescribed more roads. The road development that has taken place in the area has occurred under Labour rule. It has continued at a far greater pace than anything the right hon. and learned Member for St. Marylebone prescribed at the time. Our policies will continue.