Abolition of Investment Grants

Part of Investment and Building Grants Bill – in the House of Commons at 12:00 am on 22nd June 1971.

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Photo of Mr Thomas Urwin Mr Thomas Urwin , Houghton-le-Spring 12:00 am, 22nd June 1971

I address myself immediately to the most contentious aspect of the Bill, which is undoubtedly the proposed abolition of investment grants. Earlier tonight, hon. Members opposite eloquently argued the justice of the case made on behalf of Cleveland Potash, although they did not carry their support into the Lobby.

My hon. Friend the Member for Chesterfield (Mr. Varley) went to some lengths to demonstrate the decline of confidence among industrialists in the development areas as a result of the Government's policy, especially the withdrawal of investment grants. No one, certainly not on this side of the House, will overstate the situation which has developed over the last few months, but the forecasts of the C.B.I. and the T.U.C. have been well justified.

There have been criticisms from people in the development areas, from those who are at the centre of these policies, people who had looked forward to the possibility of being able to resume employment as a result of the policies of the Labour Government. But it is undeniable that over the past few months the confidence of those most directly involved has markedly waned.

Since last June, some of us have questioned Ministers, especially those from the Department of Trade and Industry, about the efficacy of their policies and about the prospects resulting from a withdrawal of investment grants and the general package which the Government are now operating under the guise of a regional policy.

It is a gross understatment to say that that policy is not succeeding. Month after month, quite distinct and apart from the success achieved by the Labour Government, not only is the number of inquiries by industrialists decreasing, but, at the other end of the scale, in terms of jobs being produced for people hungrily awaiting them, the news is extremely disheartening.

Despite the limited time at my disposal, I cannot refrain from drawing attention, as did my hon. Friends from Scotland and Wales, to the serious situation in the Northern Region. My right hon. Friend the Member for Sunderland, North (Mr. Willey) spoke briefly, but nevertheless movingly, about the crisis of confidence on Teesside. The House should know that there is a crisis of confidence throughout the Northern Region. I have no doubt, from what has been said in this debate and on Report, that this will be reflected in Scotland and Wales, on Merseyside and, indeed, in the South-West and all the other development areas.

Today my confidence has been further undermined as a result of the evidence which has been presented by the Minister for Industry. Under the Labour Government's policies the Northern Region in 1968—this may have had some connection with the fact that since 1967 we had a Minister with special responsibility for the North—after being some way down the league table in terms of job procurement, through the medium of I.D.C.'s, leapt to the top of that table and held that position until 1970. The figures for April and May in the years 1968, 1969 and 1970 show an all-time record of 5,003 jobs estimated to have accrued as a result of industrial development certificates which had been approved.

Against that we have the appalling figures, released today, for the same two months of this year of 410 jobs in a region where over 70,000 men are unemployed and waiting for jobs. The new jobs expected to accrue in those two months, against an average over the previous three years of 4,518, are a miserable, squalid 410. This is the measure of the slackening of confidence in the policies applied by this Government.

I am on record on previous occasions in this Chamber and in Committee as saying that the investment grant system was the linchpin of the Labour Government's policies in terms of procurement of new industry and the disbursement of industry throughout the development areas. Its removal is having drastic consequences in these regions.

I want to sound a serious warning note to right hon. and hon. Gentlemen opposite, from the Prime Minister down. If they read this morning's Newcastle Journal they will see the justification for what I am saying. Deep and serious concern is being expressed by journalists, industrialists, local authority representatives, and many other people who have any interest in the relief of the dreadful problem of unemployment. They will read that the T.U.C. is to organise demonstrations in the areas of highest unemployment—and it need not go outside the Northern Region to find those areas. Sunderland is quoted as a ready-made centre for such a demonstration. There is talk about demonstrations in other parts of the country and organising a march on London.

I shall never forget the Jarrow march of 1936. Some of my friends who are still alive were among the organisers and leaders of that march. Without wishing to appear pessimistic, I warn right hon. and hon. Gentlemen opposite that there is a fear in the Northern Region today that a repetition of the Jarrow march of 1936 is under way. This is largely due to the situation which has been allowed to develop under the Government's callous policies which completely disregard the needs and requirements of people to work for their living. In this context the Bill is a nonsense and should be withdrawn.