Upper Clyde Shipbuilders

– in the House of Commons at 12:00 am on 2nd August 1971.

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3.30 p.m.

Photo of Mr Tony Benn Mr Tony Benn , Bristol South East

I beg to move, That this House do now adjourn.

I wish at the outset, on behalf of the whole House, to express my congratulations to the Secretary of State for Trade and Industry on having escaped injury in the bomb attack on his flat. I am sure that hon. Members on both sides will also wish to be associated with an expression of sympathy for the woman who was hurt in the attack, and in denouncing in strong language any attempt to solve our domestic problems by violent means.

This debate is about a major human tragedy affecting thousands of workers and their families on Clydeside who will be left without work, without the pride that goes with work and without the self-respect of earning their living in the shipbuilding industry. The decision announced on Thursday, which we are now debating, will have the effect of creating on Clydeside a disaster area worse than that to be found even in areas of highest unemployment in Northern Ireland.

The Government justified the decision made on Thursday by reference to the Report of an Advisory Group published before the House as a White Paper, though unsigned by those who were supposed to have taken part in it. I submit to the House that this is the most inadequate, inaccurate and misleading White Paper presented to Parliament for many years. Responsibility for accepting it lies firmly with the Prime Minister and his Cabinet colleagues. It is, therefore, to the Government that we must turn to justify the publication of the Report, the heart of which lies in the first conclusion and first recommendation. The first conclusion referred to: a totally mistaken initial structure which forced together in one rigid and presitious Group five companies whose shipbuilding competitiveness was exceedingly doubtful. That was the heart of the first conclusion. The centre of the first recommendation was that an end be made to Upper Clyde Shipbuilders. If what was said in the Advisory Group Report were true, and it is not, then the Government could lay all the responsibility on the Labour Government, which is what they wish to do. The wording of the Advisory Group's recommendations bear a very striking resemblance to a pamphlet published two or three weeks ago by Aims of Industry and was clearly inspired by the same thinking. [Interruption.]

I wish to make it clear at the outset that I accept full and complete personal responsibility for the policy followed by the Labour Government before, during and after the establishment of U.C.S. But it is a very curious thing that the Advisory Group—quite wrongly called the Three Wise Men—made no attempt, and I have checked this, to investigate the conditions that prevailed at the time of the formation of U.C.S.

The Advisory Group had one hour-long interview with Sir William Swallow, but he was asked no questions as to the conditions at the time when U.C.S. was formed. The Group also made no attempt to interrogate me about the part I played at that time. [Laughter.] If hon. Gentlemen opposite think that a Report presented to Parliament purporting to give a judgment, without hearing the evidence, reflects well on those who made it, then they are confirming my belief that responsibility in this matter goes beyond the Cabinet to the whole of the Conservative Party.

The plain truth is that in 1965 British shipbuilding as a whole was on the point of collapse. The Geddes Committee was set up in the spring of 1965 and, after sitting for one year, it recommended that the whole of the Government's approach to shipbuilding should be based on the idea of grouping. At that time all the yards in U.C.S. faced bankruptcy, the first to go having been Fairfields. If the Labour Government had not intervened to save Fairfields, it would not now be possible for the Government to come forward with a proposal based on Fairfields as the centre of a new shipbuilding group.

When, in 1966, the Geddes Report was published, it was accepted by management and labour. It was accepted by the Government and Opposition of the day and the Bill which I presented to Parliament to implement it was received unopposed on Second and Third Readings and was welcomed by spokesmen of the then Opposition. It was as a result of the Shipbuilding Industry Bill, as it then was, that U.C.S. was formed.

Let it be clear—because one would never guess this from reading the Report of the Advisory Group—that the grouping of U.C.S. was on the initiative of the private yards and not on the initiative of the Government. A working party of private shipbuilders was set up and it invited Mr. Hepper, who had been appointed to the Shipbuilding Industry Board, to work with it to prepare the grouping.

When the grouping had been prepared by the private shipyards, plans were submitted to the Board. The Board recommended support and I approved that support. But the group did not come into being until the directors of the private yards had submitted the matter to their shareholders and their shareholders had approved the formation of the group. Mr. Hepper was made Chairman of U.C.S. and is on record as saying that he did not expect the group to be viable until 1973.

The first grave inaccuracy in the Report of the Advisory Group is its suggestion that this group was forced by the Government to come together. The plain fact is that the private shipyards themselves responded, on their own initiative, to the recommendations of the Geddes Report.

To describe it as a "prestigious group" is a curious choice of adjective. By world standards, U.C.S. is a tiny shipbuilding group. The hon. Member for Eastleigh (Mr. David Price), now Under-Secretary of State for Trade and Industry, said on Second Reading that there were three Japanese shipbuilding groups with a capacity greater than the British and German shipbuilding industries put together. The idea that this was a massive and unwieldy group was, by nature, totally untrue.

The Government supported U.C.S. at the time for a number of reasons, first for employment reasons. There were 13,500 men working in the Upper Clyde yards, supported by another 20,000 in supply industries in the area. The possibility of more than 30,000 jobs disappearing in West Central Scotland and on Clydeside was quite unacceptable to us. We were not prepared to see men rotting on Clydeside if there was a possibility of building a viable group there.

Lest this might appear to be soft-heartedness compared with the hard-heartedness of hon. Gentlemen opposite, it is worth adding that on any cost-benefit study of the alternative of allowing the men to rot the building of a new shipbuilding group out of those components made a lot more sense. Forming U.C.S. made much more sense than letting a lot of men be paid by the Government for doing nothing. There were also, of course, balance of payments considerations. Part of the balance of payments surplus which the Chancellor now enjoys was earned by U.C.S. because every ship built in Britain is either an import or export substitution factor.

The record of U.C.S. is well known. About £12 million of the loss which we have been invited to believe is the reason for its collapse was inherited primarily from the old private companies that had formed part of the group. When these private companies submitted their estimates of loss they under-estimated by a factor of four; the losses were four times as great as they had estimated, and this does come out in the Report.

When the £9 million of loss on the early orders of the new group are taken into account—and it was exactly to cover them that Geddes recommended that grants be paid to cover transitional losses—one gets to the figure of £21 million arising simply from the formation of the group. The Advisory Group says there were no improvements in facilities, no worthwhile investment". What the Group forgot to mention was the covered berth at Yarrow's which the right hon. Gentleman opened himself. This was announced by the Shipbuilding Industry Board at the time when U.C.S. was in being. The plain truth is that Yarrow's came into the group and got a £1·25 million covered berth. I am told—the Minister will correct me if I am wrong—left the group to this year paying £1 sterling for its shares and for its pains was given a £4½ million loan interest-free up to 1974 by the Government from the Defence Vote in order to carry its losses. No reference whatsoever is made about that in the Advisory Group's Report.

I do not have to make it clear because the record is there to be seen, what the late Government's estimate of the management record was in the group. I made it clear in June, 1969, that we were not prepared to continue financial credit unless there were substantial changes in management practice, unless working practises were altered, unless there were some slimming of the labour force amounting to some thousands of men.

The oft repeated quotation by the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) in the House in the early hours of Wednesday morning implied that at that time I said there was no further money for U.C.S. That is not true. I said we were not prepared to provide more money at that time unless these changes were carried through and that the S.I.B. would be ready to look at the matter again in the early part of 1970. Then before Christmas we offered a further £7 million which was welcomed at the time by the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor) in his intervention when I made my statement.

The question which the House has to decide, and which the men on Clydeside want answered, is whether the achievements in the last two years justify continued faith in the concern. Mr. Ken Douglas, who was appointed managing director in 1969, came from Austin and Pickersgill, and is one of the most successful shipbuilders in this country, a man who has been in shipbuilding for 35 years, a man who instituted the cost accounting system—picked out for praise by Geddes. In the two years he has been there, steel productivity rose from 11 tons per man per year to 23·6 tons per man per year, more than twice in two years. Mr. Douglas checked the average records of the private shipyards in the 15 years before the formation of U.C.S. and the fact is that at no time did the private shipyards reach more than 10 tons per man per year—in the 15 years before the formation of U.C.S.; and the 23·6 tons per man per year productivity now compares with the best to be found in the country.

The labour force has been reduced by 16 per cent. on an agreed basis. Wage rates, separate wage rates, inherited by U.C.S., which numbered 700, have been reduced to four.

The Clyde class standardised ships have been launched, and standardised ore-carriers started. The order book is £90 million—which the Advisory Group says is rather small. Why is it rather small? Because over the winter the Government stopped the credits and the group was unable to get fresh orders.

Looking back over the years of U.C.S., and with the benefit of hindsight, I have no doubt in my own mind that it would have been better if the previous Government had taken the whole industry into public ownership at the time we launched our programme. We should have re-equipped and rationalised and swept aside the old owners. [HON. MEMBERS: "Oh."] Well, why did the Government appoint Lord Robens to the Advisory Group? It is a fact that he was the man who did exactly to the coal mines what I am saying we might well have done to the British shipbuilding industry. It is astonishing to me that Lord Robens, who has had experience with the Coal Board, should have allowed his name to go forward in signing the Advisory Group's Report.

I say this to the Government, in the light of what I have said to the House, that there is no substance in the charge which they are trying to make against the previous Government, and this is why the case for a Select Committee is absolutely unanswerable. In a Select Committee the facts could be brought to light, and my colleagues and I could be subjected to cross-examination by the Members of the House. I believe that that is the proper way to proceed.

Now I move to the record of the present Government in dealing with Upper Clyde Shipbuilders. Of course, the first item is bound to be the so-called Ridley report printed in The Guardian, which was written before the election—in December 1969.

The hon. Member for Cirencester and Tewkesbury made four recommendations: One. Give no more money to U.C.S.Two. Let Yarrow leave U.C.S. if they still want to.Third. This would mean the bankruptcy of U.C.S. We could put in a Government 'butcher' to cut up U.C.S. and sell cheaply to Lower Clyde and others the assets of U.C.S., to minimise upheaval and dislocation. Finally: After liquidation or reconstruction we should sell the Government holdings in U.C.S., even for a pittance.

That is and has been the attitude of the Government and of the Minister now responsible. That report has been quoted time and again and it was put to the Minister in the debate last week, and has never been denied.

It has to be remembered that had payments continued in the autumn of last year, and had the Government not stopped the guarantees under the shipbuilding credit scheme, from October until February, 80 per cent. of the payments due to U.C.S., amounting to £5·3 million, would not have been withheld on orders. If we look at the steel production figures we shall find that the only reduction in the rising curve of productivity occurred during the winter, when the credits were withheld.

The day on which the Government told U.C.S. that they were going to resume these payments—they told them on 3rd February—if they had not the bankruptcy of U.C.S. would have been announced on the same day, 4th February, as the bankruptcy of Rolls-Royce, and the reason why the Government gave a little more time to U.C.S. was that even they were unable to contemplate the bankruptcy of Rolls-Royce and the bankruptcy of U.C.S. on the same day, 4th February, 1971.

It is, perhaps, a curious turn of events, that as we are debating U.C.S. today the United States Senate debates the guarantee for Lockheed, without which the disaster in Glasgow—the Hillington plant and elsewhere—would be more seriously compounded.

We come to 3rd February, and I refer again to that evil genius, the hon. Member for Cirencester and Tewkesbury, whose name recurs throughout this story. This is what he said on 27th July, when he was talking about the announcement of the credits, that they would be roughly twice what had been announced to the House on 11th February: The company's accounts were inspected by the accountants in the Department and in the Treasury including the company's accountants, believed that the company was perfectly viable and in a condition to continue trading."—[OFFICIAL REPORT, 27th July, 1971; Vol. 822, c. 393.]

What the Minister said last week was that on 11th February the Department of Trade and Industry and the Treasury were convinced that the Company was viable.

Then we come to the position now where the right hon. Gentleman was able to tell the House that there was no prospect whatsoever that Mr. Hepper could give him any hope of viability being continued. He said he did not know what the position was.

I have in my hands a document which he probably knows very well, which was submitted to his Department by the company under a system I instituted myself. There are 17 pages of figures broken down by yards, to each ship under construction, showing wages every day, showing the latest cost and the variations between estimates and costs. The Government had their own director on the board, and there was the Shipbuilding Industry Board, which had the full resources of the Department and the Treasury, and yet the Minister says he did not know the position at U.C.S. Then, in the summer, U.C.S. asked for £5 or £6 million in further support. It was this that led the Government to set up the advisory group and to publish a report which is quite unworthy of those who contributed to it, with no evidence, no figures and no estimate of the cost to the Government of the course which it recommended to the House.

The consequences of this action are well known to hon. Members. If the figures given in the report and the statement are right, 5,000 to 6,000 men could be directly affected on Clydeside. Allowing a ratio of two to one for people in the supplying industry—because shipbuilding is an assembly industry—there could be up to 15,000 people made redundant by the Government's statement. In Clydebank itself, a community of 50,000 people, about one person in three works in U.C.S. The local authority gets £100,000 in rates from the Clydebank yard. Faced with redundancies on this scale, housing subsidies will have to be paid to the unemployed. There are three advanced factories, two building and one authorised, and no takers. The shop- keepers among many others already have been and will be affected. The school-leavers are not just leaving school but leaving Clydebank, and the town is on its way to becoming a ghost town, a town whose local authority the advisory group recommended should be invited to contribute towards the redeployment of the men. The steel workers at Clyde Bridge who supply the steel for U.C.S. are also faced with redundancy. It is estimated that £40 million of gross trade is to be taken out of the Scottish economy, an economy now denied investment grants and faced with the ending of R.E.P.

Other shipbuilding firms throughout the country are directly endangered by the fact that this Government are the only Government in any advanced country now giving no support whatsoever to the shipbuilding industry, except—and it is surprising—that the Stormont Government, unlike the Government in Westminster, are supporting Harland and Wolff, because that Government are more sensitive to the social considerations.

What is the cost of the policy? Can it be proved that this policy is somehow cheaper than the alternative? Let me add up the cost. There is the £3½ million given to the liquidator. If unemployment is between 5,000 and 15,000 that means between £5 and £15 million in redundancy and unemployment pay for the first year alone for the men involved. New jobs at an estimated cost of £1,000 to £1,500 per job would cost another £7 to £21 million. Capital for the new company, which the Secretary of State admits could be £10 million, might involve the Government in £7 million. On the estimates I make, and I have not the figures which the Minister has, it looks to me as though the Government have embarked on a policy involving expenditure between £22 and £49 million in lieu of giving the £5 million that U.C.S. required to maintain itself in June of this year.

For these reasons we believe that the Government's policy is a massive betrayal of the men working in U.C.S. It makes no industrial sense, and it makes no economic sense. While the advisory group was recommending this contraction of British shipbuilding, during the last few weeks, the Japanese have announced an increase of shipbuilding capacity of 5 million gross registered tons a year to take place over the next eight years.

Now I come to the attitude of the men faced with this betrayal. They have decided to fight for their survival against the fate the Government have prescribed for them of being put on the scrap-heap in Clydeside. Not a single member of the Cabinet has had the guts to go to Clydeside to tell the men themselves of the decision they made. The men are not striking, they are working. I support 100 per cent. their decision to work in the yards in protest against the actions that the Government have taken. Not only do I support them, but the unions, the S.T.U.C, the local authorities and the churches in Scotland support the line the men have taken.

I say this with feeling because I am a descendant of a shipyard worker and first visited John Brown 25 years ago. Over the years I have seen the labour force on Clydebank turn from a defeated, demoralised, divided group engaged in demarcation disputes and unofficial strikes into a determined and responsible body of men welded into unity in defending the public assets which have been made available to them by this House.

There is not one word of criticism from the men of the management of the yard. The reason why Mr. Douglas undertook the job may interest the House. His father was a boilermaker who had been unemployed for six years, and Mr. Douglas went there because he believed U.C.S could be saved. Mr. Douglas has said that in terms of technical and manual skills the men in U.C.S. are as good if not better than men in any other part of the country.

The steel productivity figures have been higher since the work-in was announced in June, and the first figures which are available to me show that in the two weeks following the announcement of the work-in the steel productivity figures were the highest ever achieved in U.C.S. Absenteeism has been cut by 50 per cent., pilferage has almost gone—[Hon. Members: "Oh."]—anyone working in a cold, unheated shed on cold unheated metal in the winter might take a rather different view of absenteeism, and there are some pretty distinguished absentees sitting on the Government side of the House.

The irony of this is that on Thursday in the other place the Royal Assent will be given to the Industrial Relations Bill, under Clause 93 of which it will be an unfair industrial practice for any union in Scotland to support the men faced with redundancy in U.C.S. This is the strategy of the Government. They increase unemployment and then use the courts to stop other unions supporting the men faced with the policy of redundancy upon which the Government are set.

The Secretary of State for Scotland is quoted in the Daily Telegraph on Saturday as saying that what the men have done is of no significance. It is, for reasons which I shall give the House, an historic event. The men have rediscovered, by what they have done, the self-respect which they never had under private management in the past. They want a future in shipbuilding, and they mean to have a say in that future. They have shown the way to responsibility in industry by assuming responsibility in industry. Their strong, dignified and determined stand, expressing itself in many deputations to London and by sitting in the Chamber of the House show that they expect Parliament to respond to what they have sought.

We want responsibility in industry, but we shall not get it by legislating a code of conduct and enforcing it in the courts. We shall get it by making it possible for men to exercise responsibility for their own destiny in the firms in which they work. It is up to Parliament to meet this responsibility against the background I have given to the House.

I make a positive proposal. The people in Scotland will be looking for it when they read the accounts of the debate. I propose, first, that the Government should acquire the assets from the liquidator that are not already owned by the Government; secondly, that they should write-off the debts, as has been done in other industries, notably in large chunks in the older industries such as the coal mining industry; thirdly, that U.C.S. should be asked to prepare a development plan worked out between management and workers leading to viability on a management pattern and structure agreed by the workers as a whole; fourthly, that no more than half of the money that the Government are making available to the liquidator to be poured out in redundancy and unemployment pay or in capital for the new private group should be made available to give U.C.S. an opportunity to complete its move to viability.

The charge I make on behalf of the Opposition in the House today is a grave one. It is that the Prime Minister and the Government were determined to destroy U.C.S. from the start. They consistently misled the House as to the facts and their intentions. Thirdly, they are wasting priceless assets, the skill of the people who work in U.C.S. and doing it at a far higher cost to public funds than would be necessary if the experiment were allowed to continue. They are leaving Britain, alone among modern industrial nations as the one country that is not supporting its shipbuilding industry. In the process they are deliberately sentencing thousands of people to a slow and living death of long-term unemployment in the wasteland of West Central Scotland which the Government have decided to create.

The Prime Minister's epitaph will be: "He is the man who forgot the people", and the people will never forgive him for it.

4.0 p.m.

Photo of Mr Andrew Faulds Mr Andrew Faulds , Smethwick

Let's have Ted—let Ted get on his feet. Or is he fast asleep on his yacht?

Photo of Mr John Davies Mr John Davies , Knutsford

I am grateful to the right hon. Member for Bristol, South-East (Mr. Benn) for his courtesy in referring in the terms in which he did to the recent distressing events which took place at my home.

I should like first to refer to one matter which has distressed me greatly in the last few days. It is that in any sense I personally have lacked sympathy for the situation which has arisen. [HON. MEMBERS: "Oh."] Anybody who knows me will readily recognise how unlikely that is. I have always taken the view—and I took it no less last week—that expressions of sympathy are one thing and that real steps to alleviate the situation are another.

I should like to do two things today. The first is to elucidate what practical steps are available, to say how they were devised, why they were devised, and to give the reasons the Government decided to adopt them. Secondly, I wish to review some of the background causes of this industrial disaster so that responsibility can be fairly attributed where it correctly lies. [HON. MEMBERS: "Hear, hear."]

Photo of Mr John Davies Mr John Davies , Knutsford

First, I should like to deal with the practical steps and with what has happened in recent days. With regard to the expert Group which has advised us, I was astonished to see some of the remarks which have been attributed to the right hon. Gentleman and others about the attitude and comportment of this group of people. They are from any point of view a fine lot. [Laughter.]

I should like to refer right hon. and hon. Gentlemen opposite to the remarks which were made only last week by the right hon. Gentleman the Member for Kilmarnock (Mr. Ross). I hope the right hon. Gentleman will not mind my quoting him. He said: I had the advantage of seeing Sir Alexander Glen, Lord Robens and the two McDonald's. I was impressed by the quality of the people. I was anxious to find what was their remit. If a hatchet job is to be done, it will not be done by them."—[OFFICIAL REPORT, 27th July, 1971; Vol. 822, c. 381.] I believe those remarks were correctly made by the right hon. Gentleman last week. It would seem to me irrational to imagine that this group of people, three of whom are Scotsmen with a considerable and personal interest in Scotland, should have devised what has been called a "politically motivated Report". This seemed to me to be utterly divorced from reality or probability; indeed, I am entirely satisfied in my own mind that that is the case.

I therefore found it distressing to hear the right hon. Member for Bristol, South-East seek to ally this Report with what he considers to have been a longstanding intention of the Government which they have deviously followed through a variety of different steps in order to ensure the downfall of U.C.S. Nothing could be further from the truth. The so-called Ridley report to which the right hon. Gentleman referred was, so far as I was concerned, heard of for the very first time last month. I have never heard of it before—[Interruption.]—and then I heard of it through the pages of The Guardian. How is it possible that I, who after all was responsible for the basic arrangements of policy in this field, without the least knowledge of the existence of this paper, should have been influenced by it? That idea is entirely unjustified.

The right hon. Gentleman seems to see the pursuit of this particular policy in the depriving of credit guarantees to the concern in question last autumn. He seems to forget that a specific piece of legislation, the Shipbuilding Industry Act, clearly provided that I could not give such guarantees in the circumstances in which U.C.S. found itself last autumn. Therefore, to try to pretend that the Advisory Group's Report was politically activated and that we have been following some underground and discreditable course of action is so far from the truth as to be a mockery.

It might be as well to compare the remarks I have quoted from the right hon. Member for Kilmarnock with the kind of remark attributed to the right hon. Member for Bristol, South-East in a Press Association report last week: Simply a hatchet job … the most disrepjutable report ever published in Parliament.

Photo of Mr John Davies Mr John Davies , Knutsford

Not so. It was an objective and practical assessment of the situation.

Criticism has also been levelled at the Report by the right hon. Member for Bristol, South-East because it was brief. It was not brief because the underlying material or the underlying consultation was uncareful—far from it. It was brief because the Group considered, and I think rightly, that what needed to be before Parliament and the people was a succinct statement of what the real facts were, a clear indication of the responsibilities therefor, and the steps to be taken. The background material exists in extenso; consultation was very extensive and the extent of confidential information was great too. What has been published is the most important thing. This was aimed at pointing clearly to what were the cir- cumtances of this disaster and what was the sole means of escaping from it.

Photo of Mr Tony Benn Mr Tony Benn , Bristol South East

Could the right hon. Gentleman explain one thing to the House? The only meaning of the Advisory Group's Report is to reverse totally the findings of Geddes and, secondly, to do so without making any investigation of the circumstances in which the Group was established. Would he comment on that matter?

Photo of Mr John Davies Mr John Davies , Knutsford

The problem the Group had to deal with was what was to be done at this juncture with a liquidating company in what were obviously serious circumstances and to see how survival from that situation could be procured. This was the requirement of the Group, and this is what it has endeavoured to do.

Let us consider what problems it faced in so doing. In the first place, it had regard to the physical condition of the yards themselves. Already at the time of the formation of U.C.S. back in 1967 these yards were either obsolete or obsolescent in their facilities. This was well known to the right hon. Gentleman the Member for Bristol, South-East. Since then virtually nothing has been done to modernise or make them more efficient in their facilities. The second thing the Group faced was that the provisions made for anything like an effective cost control or cost estimating system were completely absent. Therefore, the whole basis of forward costing of new construction which was established was unable to sustain any real understanding of where the group was going.

The third question that the Group had to deal with was the true state of labour productivity. The truth is—I readily rccept it—that in the course of the last 18 months there has undoubtedly been an improvement in terms of steel output per man. I do not wish at all to diminish the achievement, but it is a fact that this achievement was at a certain cost. It was at the cost of keeping the cost per ton of steel handled exactly the same as it had been previously. Do not let us be overborne by the claims of improvements in terms of the international competitivity of U.C.S. The truth is that it was not the case.

The productivity potential has improved. It was also considerably improved by virtue of building ships which were on the whole basically simpler, but it is not a factor which has enormously changed the competitive terms of this company. It would be wrong to say that it had.

By far the most important consideration the Group had to face—it is extraordinary that the right hon. Gentleman paid so very little regard to it—was the position of the order book. We had all been given to understand that U.C.S. disposed of a very extensive and considerable order book which covered it for a long while into the future. The truth is that this is not so. When the Group said in the Report that the order book was dangerously thin it meant it. The situation was that, on the basis of the order book as it stands today, there was work assured, if all three yards were kept in action, for Clydebank and Scotstoun to have about a year's work ahead—no more—and for Govan to go on for a little longer but not much. This was the state of the order book. Let us make no mistake about it. The whole of the scheduling of the production side of the business was on that basis.

What were the prospects for improved orders? They were poor, because at present the shipping industry is in considerable difficulty. Freight rates, as we all know, are low, the level of new ship orders has been poor, and the prospect of bringing in a considerable number of new orders is very remote.

So the practical effect of this was that one had to look forward to a moment of time, not so long from now, when if all three yards were maintained in action, none of them would be working for want of orders to work on. These are the facts which the right hon. Gentleman conveniently seeks to ignore. They exist.

What were the conclusions the Group drew from these facts and which were the understandable ones in the circumstances? The first was that, because of this deficit of orders and the outlook of a deficit of orders, it was necessary, if a survival of activity of shipbuilding on the Clyde were to be maintained, to concentrate the order book into the facilities most fitted to receive it. The facilities in question were those of Govan and Lint-house. They were chosen for the reason I intimated earlier—that whereas all were obsolete or obsolescent these were the least so. Govan was particularly suscep- tible to being improved, because it had space that neither Scotstoun nor Clyde bank had.

The second conclusion was that there was a need to standardise the form of ships concerned. Whereas the whole tradition of Clyde shipbuilding has been to meet on a commercial basis whatever the world has wanted, the truth is that in the Upper Clyde this potential is no longer there. In relation to the undertaking of orders for worldwide commercial shipping the yards are restricted to a certain rather limited class of ships. Therefore, standardisation in those forms of ships became essential.

Next, it was clearly envisaged that one of the fundamental requirements was a big change in management, because management has undoubtedly failed to do in U.C.S. what perhaps the right hon. Gentleman wanted. The result has been that the management is not capable of defending this new entity, this new effective long-term nucleus of shipbuilding on the Upper Clyde, and it had to move to a very much improved labour productivity. This was evident, for the reason I stated earlier, and also because in relation to worldwide shipbuilding our productivity per man is still very low.

All this meant an access to a considerable amount of additional capital. The right hon. Gentleman mentioned the figure of £10 million. It may be as much as that. I have said, and I mean, that the Government are prepared to come in with this, but they want to see some private effort to support the operation.

The reaction of the Government to the expert Group's proposals, which I contend were absolutely reasonable and impartial in the light of the facts and not politically motivated in any sense, was to try to see whether there was any possible alternative arrangement. However, any alternative arrangement that contemplated maintaining all the yards in action would be fatal, faced with the fact of the effluxion of the order book and the certainty that within a reasonable time there would have been no shipbuilding at all on the Upper Clyde. The only basis, therefore, was to take the proposals which have been made and go to work on them.

Therefore, although I understand and sympathise with the action which the men have taken and to which the right hon. Gentleman referred—I understand their emotions of dismay and shock which have obviously taken place—I am sure that they are making a fatal mistake. I am sure that they are doing things which unfortunately will lead in the end to their own great disadvantage.

I greatly deplore what the right hon. Gentleman has been doing in trying to foster and incite them to do so, because this is not in their interests at all. [AN HON. MEMBER: "What is the right hon. Gentleman going to do for them?"] I will certainly have a word to say on the subject of the problems we face.

Photo of Mr Eric Heffer Mr Eric Heffer , Liverpool, Walton

Why does not the right hon. Gentleman go there?

Photo of Mr John Davies Mr John Davies , Knutsford

It may interest right hon. and hon. Members to know that my intention is to go there to-morrow—[HON. MEMBERS: "Hear, hear."]—and I look forward to going there with my right hon. Friend the Secretary of State for Scotland to talk to anybody who reasonably and sensibly wishes to see the activity of shipbuilding pursued on the Clyde.

I realise—none better—that even if the project which I believe is the essential one for us to pursue materialises, the impact of the U.C.S. failure will be very grave indeed- I have no doubt about that. Even if Lower Clyde Shipbuilders is able to take on 1,000 additional men, even if the other assets of U.C.S. are acquired elsewhere and operated for shipbuilding or other purposes; even though, too, the impact of concentrating this programme in a sustainable long-term operation on the Upper Clyde will have a mitigating effect on the position of the supplying concerns, I realise that there will undoubtedly be serious redundancies on the Upper Clyde. I deplore it as much as anybody, but I sincerely believe that what has been put forward is the best proposal in all the circumstances.

I know, too, that there have been a great many questions as to why something special could not be devised all of a sudden to try to mop up what is a very serious situation. Unfortunately, the trouble is—I am sure that hon. Members on both sides of the House realise this—that what we are faced with at the moment is an inadequacy of investment. [HON. MEMBERS: "Whose fault is that?"] I think I know very well where the fault lies, but I am not here to debate that question. I am here to debate the question of the Upper Clyde, which is my big problem at the moment.

I sincerely believe that, in view of the state of the level of investments, the use of regional differentials and the discipline of the I.D.C. policy are not wholly the right methods at the moment by which to seek intensive investment in the Upper Clyde. The real problem is to increase investment, and the measures of my right hon. Friend the Chancellor of the Exchequer are devised to achieve that on a national scale.

The first issue that has to be faced from now on is to get the management situation right. Until that is done, all the rest of the problems are secondary. Therefore, the first thing I shall look to the Group for—and I have confidence in the Group to help with this—is to find adequate management to replace what has been in the event inadequate management. Only then will it be possible to enter into the various other measures which are concerned with negotiating with the unions, discovering sources of capital to sustain the venture, and examine with the liquidator what can be done to make sure that we can preserve the Govan-Linthouse system on the Upper Clyde as a nucleus for the future of shipbuilding there.

The genuine sympathy and understanding which I have for the people in Clydebank at the moment are not extended to the right hon. Member for Bristol, South-East. In some sense, he has been the evil genius of shipbuilding, as he has been the evil genius of a number of the country's other industrial ventures. The extraordinarily complicated alibi, to which he treated us earlier, is entirely inaccurate and fails to recognise his own responsibility. Unquestionably, the right hon. Gentleman sponsored and encouraged the whole ill-fated venture. He was the person behind the whole operation which saw the assembly of a very ill-assorted group into the U.C.S. Company. Geddes or not, the then Minister concerned was the man behind the operation. There is no doubt about that.

Fortunately, he failed, as I believe he wished to fail, to entice the Lower Clyde shipbuilders, Scot Lithgows, into the same consortium. If we had not extracted Yarrow's earlier this year, we should have had a much more serious catastrophe on the Upper Clyde than the one that we see today.

This embryonic concern was loaded with every form of accruing liability. The right hon. Gentleman has referred to some of them today. He failed to recognise the fact that many of these liabilities were taken on after the company was formed. New orders were taken on at prices which, even in 1968, together showed manifest losses, although they were extended greatly as the years went by.

The management, for which the right hon. Gentleman cannot escape responsibility, failed to devise adequate methods of forward costing for the purpose of pricing new construction, of actual costing to check cost overrun in time to take action, of accounting generally, so that, even today, the most recent and approved audited accounts are for August, 1968. The management failed entirely to provide for essential modernisation and rationalisation of the yards. The right hon. Gentleman himself said so today. Yet he did nothing to make sure that it did. He presided over the allocation of masses of public funds to this concern at the same time as he was asserting repeatedly that he would do so no longer.

There are countless quotations on the subject. I take only one, which is the right hon. Gentleman's evidence to the Select Committee on Scottish Affairs on 24th June, 1969. On that occasion, the right hon. Gentleman said: … we have never taken the view—it would be quite wrong to take the view—that at whatever price U.C.S. or any other company in the shipbuilding industry would be kept alive. That would be accepting an open-ended commitment and would undermine entirely the shipbuilding policy generally.

Photo of Mr Tony Benn Mr Tony Benn , Bristol South East

Perhaps the right hon. Gentleman will turn back to page 256, where I said that we … were assured that the S.I.B. would be ready to discuss the developing financial situation of the company early next year were the reconstructed Board and management. … If there is any truth in what the right hon. Gentleman has said about my part, why did not the Government agree to the setting up of a Select Committee to investigate it?

Photo of Mr John Davies Mr John Davies , Knutsford

The right hon. Gentleman has referred me back to what he said earlier in his evidence. I might point out in this connection that, despite what he said about the S.I.B., he put up £7 million when the S.I.B. itself would not do so, and he put it up on an entirely subordinated debt basis, virtually unsupported by his own organism. The right hon. Gentleman has no justification for saying what he has said. In my view, he cannot escape responsibility, it is there, and his present behaviour is an affront to all that has gone before.

I must apologise for that slight diversion. I felt that the record had been greatly mis-stated by the right hon. Gentleman and that it had to be put straight.

The real need now is to take urgent steps effectively to salvage what is possible from this dreadful disaster. It is to that need that we should all address ourselves. I am convinced that the Report before us is a conclusive and practical document which we should be wise to implement. I intend to devote my own efforts entirely to that, and I enjoin right hon. and hon. Gentlemen opposite and everyone who has any influence in these matters to weigh in to try to bring it about.

Hon. Members:

Resign.

4.26 p.m.

Photo of Mr Hugh McCartney Mr Hugh McCartney , Dunbartonshire East

Listening to the principal spokesman for the Government on this issue, I was filled with disgust. It is apparent that the right hon. Gentleman's sole concern is to engage in an exercise of self-justification. He has no interest in the people involved in this terrible tragedy on Clydeside, for which he and his Government are principally responsible.

When the right hon. Gentleman was busy throwing brickbats at this side of the House, I was astonished that he refused the appeals to him to set up a Select Committee to inquire into the whole affair. If the right hon. Gentleman is so convinced that the origin of these troubles lies in decisions taken by the previous Government, why does not he appoint a Select Committee which can provide the truth and get at the facts of the matter?

I do not expect the boiler makers on the benches opposite to understand the boiler makers in Clydeside. They speak a different language. They may have callouses on their backsides, but they have none on their hands.

We on this side of the House should be wearing black armbands today. Right hon. and hon. Gentlemen opposite should be draped in sackcloth and ashes. We are mourning the death of the shipbuilding industry in Upper Clydeside, and the decimation and desolation of the town of Clydebank. It is one of the large burghs in Scotland. It has a tremendous history in the shipbuilding and engineering industries. Its men and women are proud of their heritage, and they wish to continue the great traditions which have been built up in their town. Apparently, they are to be refused the opportunity. For all time, perhaps, they are to be refused the opportunity to continue along the road that they have been travelling for so many years.

The Government are now backtracking and sidestepping. They never realised the reaction that their decision would produce. At long last, they talk about going to Clydebank. The right hon. Gentleman said that he proposes to go tomorrow. I advised him to take a good bodyguard with him—

Photo of Mr Hugh McCartney Mr Hugh McCartney , Dunbartonshire East

The shame is on that side of the House. As I have said at least three times before in this House, the social and industrial policies of this Government are taking them down the road to violence. We cannot shut our eyes to the possibility.

I turn now to the Report of the Advisory Group on Shipbuilding on the Upper Clyde. This document, for which the Government are responsible, although they are trying to hide behind the four wise men, if such they can be called, supports statements made by the Secretary of State and others. Unlike some people, I do not think that it is a stupid document. It has been very skilfully prepared to ensure that there will be no continuity of shipbuilding on the upper reaches of the Clyde.

Paragraph 3.1 states: Our Recommendations, subject to the approval as appropriate of the Liquidator, are as follows:—

  1. (1) that an end be made to U.C.S. whilst retaining legal and financial flexibility to help achieve other objectives".
  2. (2) that a successor company is established at Govan/Linthouse, and that Clydebank and Scotstoun be disposed of as soon as possible by the Liquidator".
It then goes on to refer to the programme for the yards, and in paragraph 3.5 states: We must emphasise that these recommendations in respect of the continuation of shipbuilding at Govan are conditional on:—
  1. (1) the full co-operation of the Unions in making this venture succeed and, in particular, in the acceptance of shift working of the type suggested above, together with competitive wage rates "
What is meant by "competitive wage rates"? It means that the Upper Clyde workers who are left in the yards after the Government have finished with them will have to accept the kind of conditions which prevail on the lower reaches of the Clyde. No trade unions or members of trade unions will accept a reduction in their standards of living through a reduction in wages and working conditions. But that is what it would mean. I will not go into the other two conditions, although we talk about "satisfactory management". I heard it said the other day that if they have to go to Japan to get satisfactory management they will get the right kind of management.

If we fail to meet any of these conditions the whole of the Upper Clyde shipbuilding structure and of shipbuilding on the Upper Clyde will disappear entirely. This is what the Secretary of State has said. We believe that the Ridley report, whether or not the Secretary of State denies knowledge of it, was the blueprint for what is now happening on Clydeside. It has been followed word by word, phrase by phrase and clause by clause. It was presented to the Tory Party before the last election by then Honourable Nicholas Ridley, known on Clydeside today, although the Under-Secretary of State, as Old Nick: the man with the horns, the forked tongue, the spiked tail and the cloven hoof. That is the impression which workers on Clydeside have of the Under-Secretary and the Secretary of State as a result of their negotiations with them since they became respectively Under-Secretary of State and Secretary of State for Trade and Industry.

The report gives little or no information, as my right hon. Friend indicated, on how they arrived at these conclusions. I ask the Secretary of State, or whoever is to reply for the Government, to tell us what will happen in the event of no private capital becoming available to finance the project in which they are ostensibly interested. Will they honour their statements at the Dispatch Box, repeated on a number of occasions, that they will maintain a shipbuilding complex on the upper reaches of the Clyde? Will they put public money into the company? Will they nationalise the industry to ensure that their promises are kept?

What about the yards on the north side of the Clyde? We have heard that people are interested in the yards and have made inquiries. If there is no other way of assisting people who are genuinely interested in maintaining a shipbuilding industry on the north side of the Clyde than Government finance, are they prepared to give those people the necessary finance to develop the yards on the north side to maintain employment there?

Lord Provost Liddell of Glasgow, has indicated that he could have had about £3 million or £4 million of private capital made available if it had not been for the fact that the Government had no intention or no hope of any future shipbuilding unit on the Upper Clyde. Lord Provost Liddell is not a Socialist. He is not an extremist in the trade union sphere either. He happens to be a well known Tory Lord Provost. If he has no faith in the Government providing the support for a shipbuilding industry on the Upper Clyde, what hope have we of any outsider doing so?

The Clydebank area faces a situation similar to that which prevailed in the 1920s and early 1930s. We are witnessing whole families being affected by this situation. For example, I visited a house last Saturday morning. In that house was a father, two sons, three uncles and two fathers-in-law, all of whom had served their time in the industry. The father had been working in the industry for 47 years. They will all lose their jobs as a result of the Secretary of State's decision. The two sons had equipped themselves for managerial posts by undergoing courses at the local technical college. One of them has recently bought a house on mortgage. Now their whole future has gone.

The young people in the area, those just leaving school and coming from colleges, having equipped themselves specifically for work in the shipbuilding industry, have no jobs to go to in that area. They will be leaving the town or trying to get deadend jobs elsewhere.

I am astonished that in this Report there is reference to the local authorities. Paragraph 3.1(4) states: that every assistance is given by the Government and the Local Authorities in assisting redeployment of redundant staff and workers … I should like to know what local authorities were consulted by the four wise men about the way that they could assist in the redeployment of these redundant workers. If they were consulted, will the Secretary of State tell us where they will redeploy them in an area which will achieve an unemployment rate of about 20 per cent.? Where will they be redeployed? In the Glasgow area? Certainly not, because the unemployment situation there is the worst since 1940. Across the river in Govan and Dunbartonshire where the Plessey troubles have occurred? No. There is nowhere in that area where any local authority could be of assistance in the redeployment of these redundant workers. [AN HON. MEMBER: "Brussels."] It is a well known fact that the Germans, the Dutch, the Belgians and the Italians are already looking towards Scottish workers to take up the empty places in their countries. We want our people to be employed on Clydeside doing what they are trained to do. The Tories do not understand that. I am sure that there are many hon. Gentlemen who feel concerned about the situation, but do not understand the people. It is time that they realised what the situation was.

A great deal of criticism is now flowing from the right hon. and hon. Gentlemen opposite about the decision of the shop stewards and the trade unions in the U.C.S. yards to take over in the way that they have done. This is one of the things to which I have previously drawn attention: that, because of the Government's policy, there would be a natural reaction on the part of the workers to preserve and protect their jobs and standrads of living. That is exactly what has happened. The only thing is that not only the manual workers are affected. At every level in the shipyard, from the managerial level right down to the workers on the shop floor, they are unanimous that until the Government change their present direction they will stay inside the yard, with the assistance of their workmates in the country outside and overseas.

There are already indications of help from all over the world—messages of sympathy and financial assistance are coming in—to ensure the success of the struggle of these workers.

Today I have sent a telegram to the Provost of Clydebank saying: I respectfully call on you, as civic leader, to launch an international appeal for funds to support United Clydebank Ship-Workers Unlimited to finance the continuation of employment for all shipbuilding workers in their own industry on Upper Clyde. If that call goes out a massive response will result and we shall see funds pouring in far exceeding anything that this Government are prepared to do to sustain the Upper Clyde Shipbuilders, or any section of it on the Clydeside. It is astonishing that the Government are willing to pay over £1¼ million to provide a car park at Westminster, but they cannot provide a small amount of money required to continue U.C.S.

There is no point in appealing to the Government to change their mind, because they set out on this road before they were elected last year. All that can be done is to mount the most massive campaign that we have ever seen—and we intend to do this—to bring this Government down and restore the workers' position to what it should be under a new Labour Government.

4.42 p.m.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Glasgow Cathcart

I am sure that the House will sympathise with the hon. Member for Dunbartonshire, East (Mr. McCartney), bearing in mind that many of his constituents are faced with uncertainty about their future. I hope that the House will forgive my saying a few words, as I represent a constituency in which there are several hundred people who work in the Clyde yards. Before I came to the House I worked in the Clyde yards as an industrial relations officer. In view of that experience I hope that what I have to say will be helpful.

We must not under-estimate the magnitude of this crisis, or as my right hon. Friend said, the disaster that is facing us in the West of Scotland, where there is the prospect of 8,000 men becoming unemployed. We also have to face unemployment in the suppliers to this assembly industry—affecting perhaps 12,000 or 15,000 men. There are also many people outside the yards, such as small shopkeepers, who depend on the yards for their livelihood. We are doing this in a situation and against a background of many Clydeside closures in recent years—Dennys, Harlands, Barclay Curie, Henderson, Inglis and Blythswood. We also have the appalling background of over 100,000 unemployed in Scotland.

I hope that the House will concentrate on the best way of getting out of the problem, and not refer to the past and allocate responsibility. Those who say that this is part of some massive Tory plot to try to undermine the Upper Clyde are not facing the facts. No Government—of whichever party—would gladly contemplate a situation in which they were creating more unemployment in the circumstances that already exist.

At the same time, I think that some of my hon. Friends are being hard on the right hon. Member for Bristol, South-East (Mr. Benn) in constantly referring to various comments of his in which he said that no more money would be forthcoming. I know that many of the things that he said could be interpreted in that way, but in this context I think of the New Testament saying about forgiving one's brother not seven times but seven times seventy. Forgiving one's brother in that way does not mean that we say to our brother, "I forgive you and if you steal my wallet another 489 times I shall adopt the same attitude". In the context of what has happened in Upper Clyde it is reasonable to say, "Let us get down to business now in order to overcome our problem".

Those who blame the situation on the workers of Upper Clyde are also being unfair to them. I have seen the men who work there, and the report that we have received proves beyond a shadow of doubt that even if every man working in the Upper Clyde was an industrial angel—and I am sure that the men in any factory in Britain are not that—and if they had worked seven days a week without a day off and without striking the yards, in their present situation, could not have paid. It is wrong to allocate the entire responsibility to the men.

We must remember the enormous progress that has been made not only in steel production but also on the question of the integration of the trade union organisation. Some of my colleagues say, "Why not have one union instead of hundreds?" They fail to realise that in recent years most shipyards not only in the Clyde but all over Britain the platers, the caulkers, welders, drillers and the shipwrights have all come together in one union, and old demarcation problems have ceased to exist. Terrific progress has been made in this direction. In addition, the simplification of the wages structure in the Upper Clyde has been a great step forward.

The report clearly shows that we have three choices. First, we can carry on as before, with the Government providing a great deal more capital to preserve U.C.S. and avoid liquidation. It is clear from the report that U.C.S. as at present constituted—loaded with debts, uneconomic contracts and insufficient orders—could not succeed unless the Government were prepared to provide money and a number of orders.

The second possibility is to allow the Clyde to go—to say that because it cannot economically succeed we should let it go and hope that with the normal disciplines of a capitalist economy new firms will come forward which may provide profitable employment. Nobody on either side of the House will accept that possibility, given the present unemployment situation in Scotland.

The third alternative is to try to save the part of Upper Clyde that can become viable and economic. It is rather strange to see that the Geddes solution—based on the principle that size was the answer, with all the economies of large-scale production, and the rest—has not worked. Scott-Lithgow refused to come into U.C.S., while smaller fry, like Barclay Curie (Elderslie), which are repairing on in the Upper Clyde, are still doing pretty well.

Photo of Mr Jon Rankin Mr Jon Rankin , Glasgow Govan

The hon. Gentleman has referred to Scott-Lithgow. Did I understand him to say that that firm is not coming to the Upper Clyde? Why should it? It ran out three years ago.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Glasgow Cathcart

I simply said that the Geddes Report suggested that we should have a tie-in of the upper reaches and the lower reaches of the Clyde. That has not emerged. If the hon. Gentleman studies the Report he will find that that is the case.

I want to put a few straight questions to my right hon. Friend, and I hope that he will be able to help us in this situation. We know that the Government have committed themselves, in what they have said, to providing funds for the continuation of Fairfields' and Stephens', subject to certain conditions. That, at least, is something.

The second thing that we are concerned about is the position of Connell's and Brown's. According to the Report those yards, after working through their present orders, should cease to function. My hope is that buyers may emerge for the Connell yard, which has a fine tradition—the Connell family has played a real part in making it an efficient yard—and which, when I was working in the yards, had about the highest steel output of any of the firms on the Upper Clyde. In case a buyer should wish to clinch the deal and set up in business, perhaps building for one company, in the form of an integrated shipbuilding and shipping group, I hope that the Government will make it clear that they have not closed their minds to providing financial assistance for such an enterprise. This would certainly help a great deal, and we might consider either Connell's or Brown's doing something apart from traditional shipbuilding. Would the Government make clear that they have not closed their minds to that, if a buyer were to emerge?

What about alternative jobs? Not only do we have the prospect of redundancies on the Upper Clyde, but we have the question of the build-up of work on the lower reaches, and in Yarrow's. The position of Yarrow's is crucial, bearing in mind its situation and its relationship with Glasgow. Naval work is crucial here. Stephens', Brown's, and Fairfields' used to build frigates, and there was even the prospect of an aircraft carrier before certain changes were made in our defence policy.

The future level of naval orders in Yarrow's is crucial to the redeployment of manpower. Will the Government make clear that there is no question of their turning away any naval orders which might be available to this country, from whichever country they might come? [Interruption.] That, I am sure, would be most helpful.

Photo of Mr Jimmy Hamilton Mr Jimmy Hamilton , Bothwell

Does not the hon. Gentleman agree that, if one has certain principles, one does not submerge those principles to meet a contingency? Is there not some other way, without submerging our principles?

Photo of Mr Teddy Taylor Mr Teddy Taylor , Glasgow Cathcart

I hope that we shall never submerge any principles, but in any consideration of the situation on Clydeside we must bear in mind that naval orders might become available, including orders for ships which could protect the Cape route which is crucial to the defence of Great Britain. I hope that, if such orders are offered, they will not be turned down for any political reasons.

Again, on the question of the lower reaches, if we are to build up employment there, not only do we need the present orders but Scotts' Shipbuilding Company, who have done so much in naval work, will be looking for expansion there, too. I hope that in any future allocation of naval contracts the lower reaches will be regarded as available and eligible for whatever work is going.

Next, the question of subsidies. Will my right hon. Friend give an undertaking that the Government, through the O.E.C.D. and our other friends abroad, will look at the question of subsidising shipbuilding? We know that many countries provide State subsidies for shipbuilding. We know also that our own ship owners receive valuable concessions from this Government. Some years ago, an attempt was made to find out, through the O.E.C.D., whether the levels of subsidy in some countries were higher than in others. At the time, it seemed that Italy was way ahead in the league but that Britain, when everything was taken into account, provided direct or indirect subsidies which were not altogether out of line with what was provided by our main competitors. It seemed that the Japanese were subsidising less.

We ought to have some sort of agreement throughout the world to the effect that countries will not subsidise unfairly simply to pinch work uneconomically from their competitors.

I am delighted to hear that my right hon. Friend is to pay a visit to the Upper Clyde tomorrow. Looking to the future, may we hope for a real endeavour from the Government, after the initial shock, as it were, to try to create circumstances in which management and men can work together and make the very best out of this crisis and save every possible job that we can? Some harsh things have been said by the men's leaders, by politicians and by others, but, once the initial shock is over, if we are to save at least some jobs, if not all the jobs, there must be the maximum co-operation and good will in working towards that end.

Everyone in the House who has experience of the union movement on Clydeside knows that the confederation of unions, which covers all the unions involved in shipbuilding, is led by men who can be co-operative, who can, I believe, work with anyone, if it is in the interests of the members of their unions who work in the yards. I earnestly hope that that situation can be achieved. If it is not, there will be no question of all jobs or just some jobs; there will be no jobs. I am sure that all right hon. and hon. Members want to see a state of affairs emerge in which we save as many jobs as possible on Clydeside and have a really viable industry.

4.55 p.m.

Photo of Mr William Small Mr William Small , Glasgow Scotstoun

I am glad to follow the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor), who sometimes writes comments in the Evening Citizen about my style and the quality of ties I wear. Today, I am wearing the Upper Clyde Shipbuilding tie in the form of a Maltese cross—I hope not for the last time. I want no crucifixion on the Upper Clyde or any other form of cross for the workers there to have to bear.

The hon. Gentleman made Biblical allusions. I am equally able to take references from the Bible. The right hon. Gentleman the Secretary of State for Trade and Industry can be described as the Ishmalite, the man with his hand against everyone, and—just as one can read in Ezekiel—he is leaving behind him a valley of dry bones.

I address the House today as someone who has been here before. I am probably the richest man in the House in terms of unemployment and experience of what it means. I am glad to see the right hon. Gentleman the Prime Minister present because, whatever else may be said, I recognise that he has certain skills and he can fairly be described as a good shiphandler. It is a good shiphandler that we are looking for now, and I address myself especially to the Prime Minister.

The trouble with the Department of Trade and Industry is that it has no youth department. What is the expectation of youth on the Clyde now? I opened the training establishment at Yarrow's a month after the right hon. Gentleman opened the covered berths. We both sat at the high table. The boys on the Clyde now are rather short on table manners. They do not understand parliamentary etiquette and equally Erskine May. They are worried about something infinitely more important. What is happening there now is a work-in. It may turn out to be just gesture politics, but at present it ought to be seen for what it is, a meaningful demonstration.

I do not like what I can only describe as the "opinion editing" in the White Paper. I agree with what my right hon. Friend the Member for Bristol, South-East (Mr. Benn) said in cataloguing what took place. I know these yards. I have been round them all, and I know every top personality in them. I have the greatest admiration for Mr. Douglas.

Comments are made about the level of wages. In the Government's own philosophy, what is wrong with the workers pushing their luck in terms of wage rates? What is indecent about it? There is a price to be paid for labour. One of the problems in our modern society—I speak as an ex-shop steward who has had experience on the Clyde—is that the job and responsibilities of the shop steward are the most ill defined of all. What do we believe is the rôle of the shop steward, and what degree of cooperation or militancy in winning a battle do we expect from him? The people who ought to be respected, when the unions are united in looking for the salvation of the Upper Clyde, are the shop stewards, and the rôle which they take is of the utmost importance. They ought not to be caricatured as they are by some people.

I speak here as an ex-shop steward and one who has experienced unemployment. The "non-genuinely seeking work" clause does not matter when there is no job to be had. That is the position on the Upper Clyde today. The shop stewards are some of the most valuable men at the moment, and, whether on questions of redundancy pay, take-home pay or administration, they will be the advisers. I hope they do not have to advise overmuch in some of these things.

I know something about Yarrow's about Connell's and about them all. What I fear—I hope that it is not true—is that what is said about Yarrow's has a political background. If this was written by the four wise men, I want to know what the political tenor and nuances are with reference to possible naval work. If Yarrow's is an established British naval shipbuilding unit on the Clyde, in competition with Cammell Laird, Vickers or someone else, is the idea at the back of it that the Scottish part of the industry can be depressed so that we will welcome anything which brings us money? If that is the style of the document, it must have been written not by the four wise men, but by a political person.

The content of the Report surprises me. It lays down conditions for negotiations with established institutions. Paragraph 3.5 seems to be an incantation of what people would like to see. The conditions given there should be placed in the reverse order, so that the first would be satisfactory management. The second would remain adequate capital being forthcoming. We all agree that there has been a shortage of capital all along the line, and the argument was not always about wage rates. The general problem was the shortage of investment. Yarrow's did get a covered shipbuilding berth which is probably one of the best in the world. The other condition is the full co-operation of the Unions …". That co-operation will be forthcoming, but the question of competitive wage rates is a matter for negotiation once there is satisfactory management. If I were a shop steward, and thought that I was up against a bum crew, when it came to arguing for wages I would know what to do.

In shipyards, as anywhere else, when people are in difficulty they like to see the manager near at hand. When miners are in trouble they like to see the pit manager close to the face. I hope that Mr. Douglas is in charge or has something to do with the negotiations. When a man enjoys the confidence of the workers and the workers are prepared to work for him, things go better. Workers do have bad managers, but they like their own bad managers, because they are part of the family. They respect a manager's decisions if they are seen to be fair. That is what the argument will be about.

I am concerned about the state of play. I hope that the Secretary of State and the Prime Minister will have second thoughts. There is nothing wrong in having second thoughts and looking at a wider picture. Shipbuilders in Japan, West Germany and Sweden must be rubbing their hands over the situation in Britain. Any slice off the British shipbuilding potential is an encouragement to others elsewhere. When I read the Report, I find myself mourning a governmental disaster.

There is a saying that the sun will shine tomorrow. That is a doubtful hypothesis for the Upper Clyde. I hope that the Government will apply themselves to the third factor—the quality of life of the people there. If the Prime Minister is looking for a foreign policy, I will give him one. It is far better to support Celtic and Rangers. Real Madrid and Barcelona have more power than Franco. The same sort of thing goes for Dynamoes and Spartak. The sporting affairs of a big city can more or less be equated with its foreign policy. I have more faith in that international language than in the diplomats.

5.5 p.m.

Photo of Hon. Thomas Galbraith Hon. Thomas Galbraith , Glasgow Hillhead

I understand the strong feelings of Labour hon. Members, and to a large extent I share them. But emotional ecstasy does not always lead to clear think- ing.The Labour Party seems to suffer from a psychological disease that makes hon. Members opposite see in every decision of the Government not a practical reaction to unpalatable facts but the outcome of sinister designs against ordinary people. Thus, to them the situation on the Upper Clyde is not a distressing case of business failure, which is what it unfortunately amounts to, but the implementation of the so called Ridley plan, which we hear so much about these days, to sabotage the industry—as if any Government or any person would deliberately wish to sabotage any industry that was doing well. We have only to think calmly about the matter to see how ridiculous the suggestion is.

But fact and fiction are not always clearly separated in the minds of hon. Members opposite, nor are they always accurate in what they say, certainly not in describing my right hon. Friend the Secretary of State as a butcher. They have got the vowel wrong, and they are gunning at the wrong man. It is not my right hon. Friend who is a butcher, as the right hon. Member for Kilmarnock (Mr. Ross) described him, but it is the right hon. Member for Bristol, South-East (Mr. Benn) who is a botcher. For it is his scheme that has gone down in ruins, causing great personal hardship, as I warned him years ago was likely to be the outcome of the unnatural amalgamation he insisted on foisting upon Clydeside.

The right hon. Gentleman is not only a botcher who makes a mess of things. He is also a bit of a hypocrite, for he is now giving the impression that he stands for unlimited subsidising of the Upper Clyde. That is a cruel pose for popularity's sake. We know that he does not really mean it. We do not need to bother with precisely what he said, what warnings he gave or did not give to Upper Clyde when he was a Minister. We need only to look at what he actually did to the Greenock Dry Dock, which was to allow that company to go into liquidation—the very thing, to listen to him now, we should think would happen only over his dead body.

In what respect did the Greenock Dry Dock then differ from Upper Clyde now? However much we may regret it, however severe the social damage and personal hardship—and no one could sympathise with the men more, or understand their feelings better, than I do—there comes a time when it is no longer justifiable to keep baling out a company that cannot make both ends meet. Why should Upper Clyde alone get that special treatment? If it is right to shield Upper Clyde from economic reality, why should not every business and firm in trouble be able to go to the Government for help?

We are discussing a fundamental principle, not just a matter that is important for Glasgow or even for the whole of Scotland. It affects the very foundations upon which the whole of industry in the United Kingdom functions, because, to put it crudely, it is the desire for profit—that horrid word to Labour hon. Members—or the fear of bankruptcy which create the framework of reality within which industry can operate efficiently. Remove that framework, which is what the Opposition suggest, and there is no basis of knowing which business should expand or which contract, which should be allowed to go on or which should be got rid of.

Even in the nationalised industries it has been found necessary to impose a financial discipline, which has had the effect of reducing the size of many of them. For example, the coal industry and the railways have been reduced. So nationalising the Upper Clyde would not provide the answer.

Photo of Dr Maurice Miller Dr Maurice Miller , Glasgow Kelvingrove

Is the hon. Gentleman saying that the diabolical system he is describing should be allowed to continue or that there should be some method of interfering with it?

Photo of Hon. Thomas Galbraith Hon. Thomas Galbraith , Glasgow Hillhead

I suggest that the hon. Gentleman is living in cloud-cuckoo-land if he does not realise that there has got to be a profit at the end of the day in all industry, whether private or nationalised. Even in the nationalised industries, it has been found necessary to impose financial disciplines. Nationalising U.C.S. would not provide the certainty of preserving the company in its present size, which naturally is what the men want.

Where the right hon. Gentleman made his initial mistake way back in 1967 was precisely in trying to preserve too much. I wish at that time he had heeded my fears, which I had hoped, as a former Civil Lord with responsibility for the industry and as a Clydesider naturally sympathetic to it, might have carried some weight with him. If he had listened to those fears instead of failing to prune the industry then, he might have avoided this major disaster now. If he had done that, some of the firms would probably have gone under but others would be viable units today—instead of which, because of his ambitions, the whole lot have gone down.

The only chance of saving some shipbuilding on the Clyde is to concentrate everything on the one yard that has had most spent upon it recently. There is no other proper practical course open. That is why it is so unfair of the right hon. Gentleman to raise false hopes in the workers by encouraging them to believe that there is a future for the whole company as it exists and that occupying the yards is a viable alternative to concentrating the work in one of them. If they really care about shipbuilding on the Clyde and for the welfare of the men and the families concerned, the Opposition will not encourage them in these revolutionary ideas of taking over the yards and breaking the law. That is pure fantasy. It is living in the realm of make-believe.

Sometimes it is necessary to be cruel in order to be kind. The proposal of the Government may seem cruel but it is kind. It is facing up to the facts. It is trying to save from the debris of disaster and illusion created by the last Government the core of viability which remains and which, with the co-operation of all of us, will enable some shipbuilding still to continue on the Clyde. It is in this spirit of seeing the truth at last, after years of make-believe and of trying to save what is possible to save, that I hope the House will give its blessing, though sorrowful, to the harsh choice that the Government, in the interests of Clydeside itself, have had to make. I appeal to the Opposition to listen to common sense and banish emotion. I also appeal to the Government to remember, as I am sure they do, that human lives are involved and to do all they can to provide them with the dignity of new jobs.

5.15 p.m.

Photo of Mr Bruce Millan Mr Bruce Millan , Glasgow Craigton

I fear that the speech of the hon. Member for Glasgow, Hillhead (Mr. Galbraith) represents the typical opinion among hon. Members opposite. I much preferred what the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor) had to say. I did not agree with his conclusions and I think that he skilfully avoided some of the major issues, but nevertheless he spoke with some detailed knowledge of this industry and with a concern for it which I do not find present in other hon. Members opposite. It is a pity for Scotland at this time that so few Scottish Tory Members know anything about the shipbuilding industry or, indeed, about Scottish industry as a whole.

The hon. Member for Hillhead, like the Secretary of State for Trade and Industry, attempted to lay a great deal of the blame for the present situation on my right hon. Friend the Member for Bristol, South-East (Mr. Benn). The Secretary of State is very anxious that we should accept his good will and sensitive feelings in these matters. He is sensitive to the criticism that he approached this problem without due regard to the social and human consequences of the Government's decision. I say straightforwardly to him that I am willing to accept his protestations today but that, if he expects us to accept what he says, he must not at the same time deal in what I think is a thoroughly nauseating way with the position of my right hon. Friend and attempt to place all the blame on him. That cuts no ice in Scotland because it is well appreciated there that, if it had not been for the actions taken by the Labour Government, shipbuilding on the Upper Clyde would have disappeared completely several years ago. That is the fact of the situation. The Labour Government saved Fairfields and then shipbuilding generally on the Upper Clyde. It is rank hypocrisy by hon. Members opposite—and I am glad that the hon. Member for Cathcart recognised it—to attack my right hon. Friend in the way they have been doing.

The right hon. Gentleman did not really answer any of the specific points made by my right hon. Friend in what I thought was a brilliant speech. The real answer is simple—a Select Committee of the House. Let us by all means look into the affairs of U.C.S. from the beginning. My right hon. Friend has called for that on numerous occasions. Why do not the Government establish a Select Committee? I should like to see the whole history of U.C.S. laid bare, and all those who have been responsible for its management and direction in any way right from the inception questioned by a Select Committee. I should like to see the right hon. Gentleman and his Government colleagues so questioned. I should like to see all the facts about this affair made public. That, of course, is precisely the attitude of my right hon. Friend. Either the Government should announce tonight that they are establishing a Select Committee to look into the history of the affair or they should desist from this flagrant, unfair and hypocritical attempt to place the blame on my right hon. Friend.

The right hon. Gentleman answered none of the specific points put by my right hon. Friend. He did not answer the point about what the position was as recently as February this year. A few days ago, the Under-Secretary of State for Trade and Industry told the House that the Government accountants had seen the books of U.C.S., had gone over its financial circumstances in February last and had been persuaded, along with the company's own accountants, that the company was then viable. It is an extraordinary situation and says a good deal for the implications of the whole relationship between Government and industry which goes well beyond U.C.S. and Rolls-Royce and many other matters if the statement is true that in February the Government's own accountants were persuaded that the company was viable and yet in June it went into liquidation with considerable deficiencies.

What happened between February and June? There was little change in the circumstances. If the company was nonviable in June, it was non-viable in February. Yet the Government believed it to be viable in February. We had the statements by the right hon. Gentleman about the capital reconstruction which the independent firm of Thomson McLintock, chartered accountants, had been working on since December. We were told that no details could be given to the House because the details had not been worked out. The Under-Secretary of State later told us that the details had been worked out but it was only the other day that we got the information. In any case, the capital reconstruction was never completed before liquidation.

This is part of the history that we should have elucidated. We need not go back to 1968 or 1967, although I should be happy to do so. If we could get elucidation tonight of what happened after February this year, we should get a better understanding of the situation.

Nor have we yet been told everything about the Yarrow situation. My information is that the £4½ million which the Government gave to Yarrow's in February as working capital was required to meet losses already sustained by the Yarrow division of U.C.S. Yarrow's had been largely a loss maker. The Government decided to bail out Yarrow's for defence considerations, although they decided later not to give the additional financial assistance that U.C.S. asked for.

We want the position of Yarrow's to be elucidated. My right hon. Friend was accurate when he said that Sir Eric Yarrow and his colleagues had had an extremely good bargain from the Government. They have come out of this with the company intact and with large sums of Government money, and it has cost them virtually nothing. Incidentally, it has the only substantial piece of capital investment, in the form of the covered berth, completed in U.C.S. over the last two or three years. All this should be elucidated. We ought to know the position of the Government director and be told about the various meetings which he had with Ministers and with officials from October to the date of the collapse, because he was meeting them regularly.

We should know something more about the financial reports. As my right hon. Friend pointed out, these were not generalised, vague reports, but detailed reports ship by ship and contract by contract, breaking down costs into labour costs, material costs and so on. They gave forecasts of cash flow and so forth for 12 months ahead. Were those reports accurate? If they were, why were not the Government informed about the situation? If they were inaccurate, was that because of the inadequacy of the company's accountants, or some intention on the part of the management to mislead the Government?

All these are very important questions. I do not want to spend a lot of time going back into the history of this affair, but these questions must be answered and if they are not answered tonight, we must have a Select Committee to look into these and other questions about the whole history of the U.C.S. affair which hon. Members opposite or my hon. Friends want to have answered. If we are to be treated to these condemnations of my right hon. Friend and simultaneously to a complete lack of frankness with the House, such as we have had from the right hon. Gentleman and his colleagues over the last few months, we are faced with a shameful state of affairs.

I come to the report of the expert advisers. It is completely inadequate. It is an absolute insult that 15,000 jobs are affected and yet a miserable three page document of this sort is presented to the House. I am surprised that the right hon. Gentleman does not recognise this, and if he does not, as plainly he does not, that is simply another demonstration of his complete lack of sensitivity in these matters and his complete failure to understand the feeling in Clydeside and in Scotland generally on this matter.

We have a report which dismisses Clydebank in half a sentence. A town cannot be condemned to death in half a sentence in a three-page report. The right hon. Gentleman must realise that this report has evinced the maximum hostility not just among workers in the yard, but throughout Clydeside. My right hon. Friend was absolutely right to say that there is strong and angry feeling about the Government in the yards themselves and generally in the community in the Clydeside area.

Having created the maximum hostility, the right hon. Gentleman has compounded the offence by a highly misleading reference in the House last Thursday to 400 redundancies. The liquidator announced the very next day that those 400 redundancies would be in August and that in September there would be 1,000 more. These were not redundancies to occur in the months or years ahead. Scotstoun was to be closed by the end of the year and Clydebank next March. We are talking of 5,000 or 6,000 redundancies within a measurable period when we have more than 10 per cent. of the male population in Glasgow unemployed and when the situation in some surrounding areas is even worse and when the Clydebank situation will be disastrous if this plan is carried through.

There was an alternative, and my right hon. Friend described it very briefly this afternoon. I have never taken the view, and nor has my right hon. Friend, that millions of pounds of public money should be poured into U.C.S. regardless of the viability and the prospective viability of the yard, regardless of the state of the management and regardless of the general shipbuilding position and so on.

The view we have taken is that there should be appropriate support in a situation in which, as is well known, the British shipbuilding industry as a whole requires support and in that characteristic, incidentally, is following the shipbuilding industries of the rest of the world. U.C.S. requires support and to be sustained until it can be put on a viable basis. I believe, and nothing said in the report has shaken this belief, that U.C.S. could have been made viable with something like the number of men now employed by U.C.S.

If there is a case against that view, it should have been put into the report and we should not have been put in the position of simply being asked to accept the word of four outside advisers. Who do they think they are? There is a tremendous conceit in this. The Under-Secretary told the House the other night, with absolute arrogance, that if he told us something, we had to accept it without question. We have the same kind of attitude in this report and we had it from the right hon. Gentleman last Thursday and again today.

I believe that U.C.S. could have been sustained. That might have involved redeployment; it might have involved double shift working; it might have involved new management and it obviously should have involved changes in management; and it might have involved changes in industrial relations. All these things were required and they could have been accepted by the workers if they had been put in the context of a report and of a Government decision on that report which showed that the Government were influenced by the human and social consequences on Clydeside and that they were directed to maintaining the maxi mum employment in the Upper Clyde. The right hon. Gentleman is living in cloud-cuckoo-land, to borrow the phrase of the hon. Member for Hillhead, if he expects a chance of the kind of solution which the Government have proposed being accepted by the workers on Clyde-side and, incidentally, if he expects private capital to be interested.

The report cannot be accepted and the Government's decision cannot be accepted. It will have to be withdrawn if Upper Clyde is to be secure in any shape or form. I believe that that can still be done on the lines which my right hon. Friend and I have described. It will not be easy, particularly in the atmosphere of hostility and bitterness which the Government's decision of last week created in Clydeside. Nor will it be cheap, but it will not be more expensive than the solution now being adopted, if account is taken of redundancy payments, unemployment benefit, and the need to put money into the reconstruction of the company and the need to bring new jobs to Clydeside, and so on.

It will not be easy or cheap, but it must be done if the Government are to restore their credibility not only in Clydeside, but in Scotland. In Scotland we are facing a desperate unemployment situation. We are facing a lack of confidence among both management and men which we have never known, at least not in the 12 years that I have represented a Glasgow constituency. Only the Government can restore some of that confidence, and the first thing they must do is to withdraw this ill-conceived plan and produce another which will give hope and confidence and the prospect of success to both management and men in Upper Clyde.

5.30 p.m.

Photo of Mr Ian MacArthur Mr Ian MacArthur , Perth and East Perthshire

The nature of the problems which confront U.C.S. and the sad history which produced them has been clouded over during the last few days by the concern felt by hon. and right hon. Gentleman on all sides of the House for the future of the men working at U.C.S. and the thousands more employed by firms which depend on U.C.S. for their orders. Unemployment in Scotland is already intolerably high and the prospect of more men losing their jobs could not come at an unhappier time.

I said in our debate on the Scottish economy on 13th July that the U.C.S. problem concerns everyone in Scotland, first, because the repercussions of the situation will be felt very widely indeed, and second, because every Scot has affection and pride for the great traditions of Clydeside. Employment in my constituency is not directly affected by the U.C.S. collapse but every area in Scotland, including my own, depends on confidence and growth in the whole Scottish economy, and those qualities have been put at risk.

The risk springs in my view not so much from the U.C.S. tragedy as from the impression being created, not least by some hon. Gentlemen opposite, that Scotland itself is in decline, and therefore not a place to be favoured by expanding industry. This is a totally false impression. Despite the grave problems in Clydeside, and they could hardly be graver, despite the succession of reverses suffered by some sections of Scottish industry, the basic pattern of industry in Scotland is healthy because we have moved to a new industrial structure which has a growing stake in the new sophistication of technological advance. It is from that modern and new base that our future progress will grow. Clearly, that progress will depend on the development and expansion of the total United Kingdom economy and I therefore welcome the action taken by the Government last month to spur on growth and to revive the confidence which will produce the expansion we so desperately need in Scotland.

There has been widespread and bitter recrimination about the events leading to the U.C.S. tragedy. I suggest that argument about who was or was not responsible does not help the present very much and contributes nothing to the future. But right hon. Members opposite, and particularly the right hon. Member for Bristol, South-East (Mr. Benn) have been so busy accusing the present Government and have done so much to whip up feeling on Clydeside, that it is worth while remembering his own participation in this tragedy.

Hon. Members:

Disgraceful.

Photo of Mr Ian MacArthur Mr Ian MacArthur , Perth and East Perthshire

Mr. Deputy Speaker, if you wish to see a memorial to the right hon. Gentleman's Ministry, look around U.C.S.

Let hon. Gentlemen opposite compare what they say today with what the Advisory Group reported a day or two ago. It was the Labour Government which brought U.C.S. into existence. Today, the right hon. Gentleman tried to shuffle off his responsibility, but at least he will agree that' he certainly adopted this clumsy child. The Report states that this creation of his had: a totally mistaken initial structure. The Labour Government repeatedly poured money into the company in the belief that it would become viable. But the report shows the extent of the financial implications. Losses from pre-existing contracts were estimated at £3½ million but in the event totalled over £12 million. Further losses on new contracts were estimated at just under £5 million but totalled about £10 million.

Photo of Mr Tony Benn Mr Tony Benn , Bristol South East

Would the hon. Gentleman address his mind to the point he has raised, namely, that there were £12 million losses for these five companies, every one of which would have been totally bankrupt with 100 per cent. unemployment if U.C.S. had not been brought forward, by the companies, to the Government?

Photo of Mr Ian MacArthur Mr Ian MacArthur , Perth and East Perthshire

The right hon. Gentleman will recognise that this shows how totally false these forecasts were, just as the right hon. Gentleman beside him was totally wrong about his forecasts for the Scottish economy.

The right hon. Member for Kilmarnock (Mr. Ross) promised 60,000 extra jobs for Scotland. He failed, and lost 82,000 on top of them. All those forecasts made by the Labour Government were hollow and bogus.

The result of the miscalculations by right hon. Gentlemen has been that vast sums of public funds have vanished. The whole investment of taxpayers' money made by the Labour Government has melted away with nothing to show except disaster.

The right hon. Member for Bristol, South-East himself recognised that this continuing subsidy must stop and that the company must acquire a new structure. In his evidence to the Select Committee on Scottish Affairs in 1969 he made various statements which completely contradict the line he now takes. I quote from just one extract although there are pages of it. This is on page 265, paragraph 1456, when he says: My own view is that if we had at any stage even now said 'We will give you whatever you need' we should have deferred the vital decisions that had to be taken by the company to staunch the losses and we should have begun a permanent subsidy of a company that would then ultimately have collapsed in conditions of great tragedy for those involved, at the expense meanwhile of the viability of other shipbuilding groups. But now the right hon. Gentleman appears to insist that the Government should go on subsidising the company. The justification he advances is that it will become viable, or would do, if it was supported in this way. In the debate on the Scottish economy on 13th July, the right hon. Gentleman called on the Government to give the company … the resources to allow it to move into viability."—[OFFICIAL REPORT, 13th July, 1971; Vol. 821, c. 255.] Refusal to provide this blank cheque of resources is the linch-pin of his whole argument.

Early this year but as late as the spring, U.C.S. appeared to believe that it had turned the corner. Yet in June it asked, not for another £5 million as suggested earlier, but for £5 million to £6 million and proposed in addition to pay off its creditors at 33p in the £. Far more than £5 million to £6 million was involved in that request, and there was no clear statement of when the company would become solvent again, if at all. That I remind the House, was against the background in which this request was made—one of impending bankruptcy, suddenly discovered by the management—so suddenly that it could not pay the wages for the following week.

The Report gives a totally different picture from that painted by hon. Gentlemen opposite. The suggestion that U.C.S. has improved its structure has been knocked sideways by the Report. The Report said: no improvement in facilities, no worthwhile investment has been made. So there has been no development to create greater viability. Indeed, the Report says that: … any continuation of Upper Clyde Shipbuilders in its present form would be wholly unjustified and, indeed, could cause serious and more widespread damage. There are only two courses open to the Government.

One is to retain the present structure, inefficient, with a dangerously thin order book, and a future that will demand constant subsidy or an even larger collapse. There is no security of employment on this shaky base. The other course is to save what can viably be saved, and this is what the report proposes. In that way at least a large number of secure and long-term jobs will be produced, and that surely is the quality of employment which we need in Scotland—secure and long-term employment.

At least 1,000 jobs are immediately available elsewhere on the Clyde. The growth of Govan will produce more than the initial 2,500 jobs suggested in the Report. Successful disposal of the other yards will also retain jobs for some.

But whatever the pattern, there will be many redundancies in the end. This is the social problem which confronts us all. These men cannot be discarded simply as the price to be paid for incompetent intervention by a Labour Government. We need a constructive programme of special help, retraining, and careful redeployment in a situation of economic growth JO that we may lessen the real and personal tragedies in this wholly tragic affair.

5.40 p.m.

Photo of Mr Russell Johnston Mr Russell Johnston , Inverness

Like the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor), I shall be brief. Nor do I intend to go over the past, save to applaud the suggestion of the right hon. Member for Bristol, South-East (Mr. Benn), repeated by the hon. Member for Glasgow, Craigton (Mr. Millan) in a particularly fine speech, that a Select Committee should be set up to establish the truth, for there is clearly a conflict over precisely what is the truth. I see no reason for the Government to resist this request.

In the short time at my disposal I wish to look ahead. The Government have a responsibility to maintain these skilled men in employment. It is no use using words, as the hon. Member for Perth and East Perthshire (Mr. MacArthur) did, like "redeployment". The action must be practical, definite and immediate.

A number of proposals have been made. As the hon. Member for Craigton said, it will not be easy to solve this problem. Government action may mitigate the difficulties, but a number of world factors are in operation which cannot be set aside. The debate is, in many ways, not only about Upper Clyde but about the future of the whole of the Clyde as a major shipbuilding centre of the world.

When I spoke in the debate on the Scottish economy on 13th July I drew attention to a proposal that had been made by Mr. R. A. Robertson of Hutchison Engineering. Mr. Robertson, is highly experienced in shipbuilding and knows what he is talking about. He has been industrial adviser to the Scottish Liberal Party for about five years. His proposal has since received considerable publicity, both in the Scottish Daily Express on 26th July and in an editorial in the Scotsman on 30th July. Jack McGill, Industrial Correspondent of the Daily Express, wrote: The scheme, if given backing by the Government and the Steel Corporation, could place shipbuilding in line with the Japanese groups which have shipyards next door to steel plants. And it would give a new steel complex at Hunterston a guaranteed customers using about 2 million tons of steel a year". The editorial in the Scotsman followed the same tack and said: The Clyde has a long and illustrious association with shipbuilding. But an issue that ought to be objectively faced is whether the Upper Clyde can hold a worth-while place in world shipbuilding indefinitely. Is a movement down the estuary not inevitable and, if so, would it not be much better to plan a new modern industry in close co-operation with the proposed integrated steel works at Hunterston? A holding operation in U.C.S. and a bold forward plan could inspire confidence". That seems to offer the answer, and I spoke about this last month.

If speeches in this House mean anything—and I sometimes wonder whether they do—and if Ministers take cognisance of informed comment outside, then on what basis has any consideration of this proposal been set aside?

Is it because the Minister sees no long-term future for shipbuilding on the Clyde in the big league? This view has been expressed. Is it, on the other hand—this, too, is worrying some people in Scotland—that despite the right hon. Gentle- man having mortgaged his future on the Hunterston steel complex, in the end it will not go ahead? That is a current rumour in Scotland.

I will briefly repeat what I believe represents the only coherent answer to this tragedy. First, there should be a holding operation at U.C.S., and it should involve private enterprise, the Government and the B.S.C. Second, there should simultaneously be constructed a new super yard on the Lower Clyde into which U.C.S. would be phased. Third, we must realise that both operations are dependent on the go-ahead at Hunterston, which the right hon. Gentleman has pledged will take place. All these steps are linked with Oceanspan and the idea of a deep water terminal.

I said at the beginning that this debate is about the future of the Clyde and not just about Upper Clyde. Like the hon. Member for Glasgow, Scotstoun (Mr. Small), who knows the position well—who knows the men, their families and their commitments—I urge the Minister to think again on an issue that is vital for Scotland and the Clyde.

5.45 p.m.

Photo of Mr Jon Rankin Mr Jon Rankin , Glasgow Govan

I, too, shall be brief, and in doing so I wish to deal with an aspect of our problem which has not received much attention.

A lot has been said about the period since 1967. I want to go back to 1964, for at the root of the present difficulties, and the trouble that has blown up in the last three years—trouble which the Government are not facing up to adequately—are occurrences prior to 1967.

While I appreciate that the Minister is trying to solve this problem and while I accept that in his view he is spending a lot of money, I urge him to accept that he is not spending nearly sufficient to tackle the job that lies ahead. The solution demands more investment than he is prepared to make, and it is clear that on this as on other matters he has changed what was Labour policy.

One Sunday morning in 1964 I received an urgent message saying that I was expected to attend a meeting of shop stewards at Fairfields Yard that evening. I was told that the then owners, Lithgow's, were leaving Fairfields to go to Lower Clydeside. About 3,000 workmen at Fairfields were given a week's notice that Lithgow's were flitting, leaving the yard and the men with absolutely no future.

It was calculated that £1 million would help the yard to survive, and I had to be the instrument of finding the money. I came to London and asked the then Prime Minister, who mercifully was a Socialist, for £1 million. Having listened to the Secretary of State today, I need not wonder for long what his answer would have been. I will not name the then Prime Minister. He is sufficiently well know especially on these benches, for me simply to say that he told me, in effect, "Do not worry. The million is safe. You can go back and tell that to the workers on Clydeside." That is precisely what I did.

I brought new life and hope to the men, but our troubles were only just beginning. We had £1 million with which to start, but to make this launching place reasonably usuable that sum was not enough even to begin looking at a corner of our problem. This is still true and is basically still the problem. Although the Government may recognise the problem—I do not doubt their word about that—I tell them they are not spending nearly sufficient, and that problem of expenditure did not start in 1967 but before 1964, although there have been adjustments, as we know, and it has been growing ever since.

I wonder whether the right hon. Gentleman has thought what kinds of problems there are within a yard. I wonder whether he has ever glimpsed a yard such as I know well which only six years ago was a muddy squashy heap in which to work. There were few facilities. Men have to be educated, however, for this work. So we had a small school in one part of the yard, but for practical purposes so small a place was not much use. It was merely a gesture. However, after only three years of Labour Government and of Labour looking after Fairfields we had one of the best equipped educational centres of any possessed by any shipyard in the whole of Britain. We have it in Govan still. The right hon. Gentleman can see for himself to verify what I am saying. It is competent; well equipped; but still insufficiently equipped for training the men for this industry: that is, to train them in all the knowledge and knowhow which is needed. That is why it is necessary to have a school and to have teachers. In 1964 we had little of that. As I say, we got it right away from the Labour Government, but it is still not big enough.

So I tell the right hon. Gentleman, we need still more money. When he goes to Clydeside—tomorrow, I believe—I wonder if he will take the time—I know he will not regard is as a trouble— to see the office for those who are responsible for general working conditions and for seeing that the jobs are carried out; the shop stewards. Will he see where they work? Their conditions are a disgrace. Their office is quite unsatisfactory. They are disgraceful conditions for the educated lads who today have to perform this particular work. They have no obvious usable sanitation. The men who work there, as has been emphasised by every speaker from either side of the House in the debate have a responsible and big job to do. [Interruption.] I wish these half-heard interruptions would not persist across the Floor of the House while I am speaking. I know I have a limited time in which to speak and I shall observe the limitation.

We want these men who have these responsible jobs to be housed in offices and under conditions which are comparable with those in which the owners of the yard operate, in which the bosses operate. We want them to have this sort of equality—if I may so put it, to have that social status. They ought to be decently housed in their parts of the yard because, as has been inherent in almost every speech today, and although much blame has been attached to some of them, in their own way they have as great a responsibility for the success of the yard as have the owners themselves.

I am dealing with these conditions because I have seen them, and have seen how bad they can be, and they are the social conditions which obtain in some yards. Six years ago in Fairfields there was not a place in the office where a girl could get a cup of tea; it had to be brought in and she had to drink it in her part of the office. There was no rest room where tea or lunch could be served in conditions more in keeping with the age in which we are living. I know I am bound to a certain time limit, and that I shall observe, but, having listened to so much today about the amount of money which was being spent in keeping shipbuilding going, I felt I should like to point out if I got the opportunity that while I recognise that this is a good investment it is still not enough, because there is so much needed in the supporting services for this great industry which is not being adequately catered for. I want to make that quite clear, and I hope that if the right hon. Gentleman thinks he is spending too much he will have another thought about it and pay some attention to what I have said and approach this problem of expenditure from a different angle. I hope he will consider the conditions and services which exist for the men and women who are serving in these yards and that he will unloosen his purse-strings.

5.59 p.m.

Photo of Mr William Ross Mr William Ross , Kilmarnock

This has been a worth-while debate, although—let us face it—it has been a debate which no single right hon. or hon. Member on the other side of the House wanted. It is one of the things to be remembered that when the House was asked whether we should have this debate—and it required the support of a certain number of Members—not one single Member on the Government side rose in support of having it.

Photo of Mr Dick Douglas Mr Dick Douglas , Clackmannan and East Stirlingshire

Not even the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor).

Photo of Mr William Ross Mr William Ross , Kilmarnock

That will not be forgotten. This has been a worth-while debate. Those who thought that it would be a slashing attack on my right hon. Friend the Member for Bristol, South-East (Mr. Benn) got their answer. I have never heard a more devastating, analytical, summing-up of all the arguments, all the facts and all the dates than the speech of my right hon. Friend to destroy the case which the right hon. Gentleman was going to make.

I was involved, too, with U.C.S. and the shipbuilding industry. Remember, not a single vote was cast against the Shipbuilding Industry Bill; anyone who knew anything about shipbuilding welcomed it. Only one person on the Government side who knows anything about the shipbuilding industry has spoken today, and that is the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor), who resigned from the Government last week on a different issue. His was the only speech which showed a consciousness of the gravity of the situation and of the Government's decision.

The right hon. Gentleman said that after I had seen these four men I had said that they were not men who were out to do a hatchet job. That shows how mistaken one can be. In the discussions that we had with them, there was no indication that they would put pen to such a report. That report, read carefully, does no credit to any of these gentlemen. It is a political document.

The hon. Member for Glasgow, Hill-head (Mr. Galbraith) and the right hon. Gentleman seemed to think that it was ludicrous even to mention the Ridley report, but that report was drawn up by the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) when he was Shadow Minister in charge of shipbuilding. To whom was it given? It was given to the Shadow Cabinet. What was the result? He was made a Minister. What Department was he put into—the Department responsible for shipbuilding. We are told to forget about it. Yet every single thing that has happened has followed the plan that was laid down within that report, and the hiatus between November and February in relation to credits was because of certain difficulties in hiving off Yarrow.

The right hon. Gentleman said, either in his statement or in answer to a supplementary question, that the advisory group had the advantage of the assistance of experts in shipbuilding. Who were they? Were they the people whom the hon. Member for Cirencester and Tewkesbury saw? Was it Yarrow? Was it Scott and Lithgow? It could not have been those who were connected with the Shipbuilding Industry Board, the men whose judgment and advice to the Government has been condemned today—but not at the time. It is not surprising, if the people who were advising the group were the people who advised the hon. Gentleman, that we should get the same kind of report.

The right hon. Gentleman spoke about order books. How does he expect any company in a difficult time to build up orders when he is holding up credits? He knows that credits to the value of £53 million were held up from late October until the end of February—indeed, I think it was March before they were released.

Has the right hon. Gentleman seen the advice issued to every Member of Parliament who is interested in shipbuilding, from the Information Office of the Shipbuilders and Repairers National Association, the National Association of Marine Enginebuilders, the British Ship Research Association and British Shipbuilding Exports? This document refers to the drop in orders and says of the lower tonnage being ordered: This change in the situation compared with a year ago is the result of the uncertainties over credit in the earlier part of the year, coupled with the effect of the removal of investment grants towards the end of 1970. Who was responsible for withdrawing investment grants?—the right hon. Gentleman before the study was even set up. The document goes on to say: … forecasts suggest that in the longer term there will be an overall growth in tonnage requirements … the world's shipping capacity is being expanded. The suggestion is that our shipbuilding capacity should be looked after. This fits in with what was said by the hon. Member for Cathcart. The document goes on to say: Industry must also be able to rely upon the active support of the Government, for while shipbuilders would prefer to operate freely, it is unrealistic to think that any country without official help can compete with those nations where State aid in various forms is available. The right hon. Gentleman, far from helping U.C.S., went out of his way to kill it. He suggests that he has been unfairly attacked for seeming to be cold and callous, but his recent statement on television that he wanted to get a down-to-earth solution was no more helpful. Down-to-earth? Six feet down! That is what it means for the Clyde. Anyone producing a report like this can expect sense, but the right hon. Gentleman expected more than that; he expected a vote of thanks for it.

I lost my temper, and I have not yet regained it because my sense of anger and outrage has not been allayed by anything said by the right hon. Gentleman today. He seemed to think that we should take this calmly. The hon. Member for Perth and East Perthshire (Mr. Mac- Arthur) said that we whipped up the feelings of the men on the Clyde. He should ask the hon. Member for Cathcart, who knows something about the people of Glasgow. They did not require their feelings to be whipped up; they required to be restrained.

Mrs. Mac Arthur:

Who restrained them?

Photo of Mr William Ross Mr William Ross , Kilmarnock

I welcome the fact that the right hon. Gentleman and the Secretary of State for Scotland are going to the Clyde tomorrow. I am perfectly sure that they will not need a bodyguard, but I wish they had gone before they made this decision.

The report says that the four gentlemen took into account the social considerations. My hon. Friends the Members for Dunbartonshire, East (Mr. McCartney), Glasgow, Craigton (Mr. Millan) and Glasgow, Scotstoun (Mr. Small) put the social considerations fairly clearly, and I know a little about them. I spoke angrily about Clydebank, but the right hon. Gentleman should appreciate that the people who died during the war in Clydebank died for John Brown's. The enemy was not aiming at people, but at John Brown's, and the one place that was not touched was John Brown's, but the Government are going to kill it—a firm which is the pride of this country. How we gloried when the QE2 was launched and fitted out and finally sailed. The right hon. Gentleman the Secretary of State for Trade and Industry spoke about modernisation. I wonder how much modernisation can be done in a yard when one is building a ship of that size and fitting it out. Has he any appreciation of the difficulties involved in achieving modernisation? The one place where modernisation was embarked upon was in that part which was hived off.

The right hon. Gentleman has no appreciation at all of the feelings of the people and the quality of the men concerned in regard to the view in February that viability could be achieved in U.C.S. Has he paid any attention to the improvements that took place in steel throughput, organisation and efficiency?

The right hon. Gentleman said that the shipyards in Britain, not just those in the Clyde, had been ridden with demarcation disputes, not in one year only. I recently read the history of Glasgow and discovered that even in 1642 there were demarcation fights. The fact that all this has been reduced within this yard to an extent that is envied elsewhere is a demonstration that something was being achieved. All this is being thrown away.

I hope the Government will still change their mind. Scotland has never had a worse Government.

Photo of Mr William Ross Mr William Ross , Kilmarnock

The hon. Member for Hillhead must know that of over 30 M.P.s in the Greater Glasgow area only two are Tories—and he is one of them. The other hon. Member for that area, the hon. Member for Glasgow, Cathcart, spoke much more sincerely today because he is closer to the kind of people who work in the yards. They got no support from the Scottish people at election time. But that does not mean to say that the Government ought to write off those people. If anything, they should combine their efforts to improve the situation.

They know that 134,000 people were unemployed in Scotland in July and that in August the figure will be nearly 140,000. Some of the children who left school at the beginning of July and who have been on holiday will in August register for employment. Thus the figure will rise, as it did last year.

Photo of Mrs Lena Jeger Mrs Lena Jeger , Holborn and St Pancras South

Why does not someone wake up Ted?

Photo of Mr William Ross Mr William Ross , Kilmarnock

It is too late for him to wake up. The Government are playing ducks and drakes with the Scottish economy—they are lame ducks and weekend Drakes. But there is still time for them to change their mind, and I sincerely hope that they will.

There is far too much at stake; the whole spirit and economy of Scotland is in the balance. We do not want to see Scotland turned again into a reservoir—a pool of labour for the Midlands, London and the South-East. We do not want to see lovely areas in the north of Scotland a playground only for the absentee rich. That is not the future we see for Scotland.

If the Government want a better tomorrow for Scotland, let them start on this path tomorrow when they go up there. Let them tear up this report and let them save U.C.S. Let them go forward with a reconstruction that makes sense and with a confidence in the potential of that unequalled and unrivalled work force that will be for the benefit of Scotland and for the country as a whole. If they do not do this, they will be labelled—and that label will not be torn off easily—as betrayers of the people of Scotland.

6.14 p.m.

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

Many of the speeches in today's debate have reflected a sombre and worrying situation on Clyde-side, which has been causing great concern to me personally and to the Government. For Scotland, and for the west of Scotland in particular, this sudden liquidation, its possible consequences and the debates upon it are matters of the greatest gravity.

The problems are painfully serious in human terms, because men's livelihoods are directly affected. In any realistic examination of U.C.S., in the light of the Report of the Advisory Group, it is clear that jobs are likely to be lost or changed in numbers which will create anxiety and difficulty for many families. I am acutely conscious of the effects of a reduction in jobs upon the men who may be affected and their families. It is an additional misfortune that this liquidation should have happened at a time when unemployment rates are so high in the Glasgow area—[HON. MEMBERS: "What are you going to do about it?"]

Since the U.C.S. Board made its statement of imminent liquidation, I have myself seen in Scotland and London many deputations and representatives of workpeople, local authorities and others concerned. I am well aware of the shock, indeed the stunning effect, that the U.C.S. announcement of liquidation and the subsequent finding by the liquidator of debts of £32 million have caused. I feel myself, and share, the bitterness that this situation creates. Many of the men thought their jobs were secure. It is depressing for them now to find that many of the jobs in U.C.S. have been highly insecure since its inception.

My right hon. Friend and I will be visiting Glasgow tomorrow, having been in touch with the Lord Provost, for discussions in the City Chamber with representatives of all concerned.

For this situation, the previous Government must bear a large share of the responsibility.

Hon. Members:

Give way.

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

The group of advisers said that U.C.S. was a totally mistaken initial structure and criticised management from the beginning. Upper Clyde Shipbuilders was set up at the instigation of the right hon. Member for Bristol, South-East (Mr. Benn), and few will disagree with the four advisers that it was ill-conceived.

Photo of Mr William Ross Mr William Ross , Kilmarnock

The right hon. Gentleman voted for it.

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

We in Scotland are now having to cope with the results of this failure and to try to mitigate its social effects. In this situation, we have not only to try to achieve the best possible continuing shipbuilding organisation on the Upper Clyde but also to grapple with the problems of redundancies, reducing as far as possible the number out of work at any given time.

It is clear that about 1,000 jobs in shipbuilding will become progressively available elsewhere on the Clyde from now on, and that there are prospects of more, depending on how the liquidator is able to dispose of yards.

At the time the U.C.S. announced that it had to go into liquidation the Government appointed the group of four advisers to study urgently the situation and make recommendations. There has been criticism that the Report is only three pages long, but to be of use such recommendations had to be made immediately because they had to be well within the limited period in which, in Scotland, a provisional liquidation can last. The Government had guaranteed the wages necessary for that period.

The Advisory Group clearly has not spared itself in the work it has carried out. It was able by last week to produce a Report with clear findings and recommendations. Besides Lord Robens, the group contains leading and distinguished Scots experienced in industry and finance.

Clearly, these men were and are essentially concerned to recommend what is in the best interests of Scotland and Clyde-side. When considering their Report the House should have in mind that it has been made by men who fervently wish to see Clydeside and Scotland prosper. Nothing would have been better news to me or to the Government than if this Group had recommended the full continuance in work of the total force. This would have been universally welcomed. What it has done is to set out clearly the facts as it found them and to propose the only workable future reconstruction which it considers feasible, and it depends upon certain conditions.

Would those on the Opposition Front Bench if they had been in government have repudiated the findings of this Group of advisers and its recommendations? [Interruption] It has not been stated categorically in the debate, but I take it from that that they would have set aside this important advice.

Those concerned with Scotland must face up to the situation described by the Group. Through the centuries Scots in adversity have been prepared to face the facts, however unpalatable, rather than surround themselves with more palatable make-believe.

Having received this Report, it would have been deceiving ourselves and deceiving Scotland to have rejected it. It has been suggested that the Report is short and does not argue a long case supported by figures. However, in the time required the Group has produced findings and recommendations which are both lucid and unequivocal. As for figures, the liquidator has made that position clear. Had the Report of the Group gone into all the figures at length, right hon. and hon. Members opposite would have been the first to say that it was simply an accountants' document.

The Advisory Group has recommended a scheme under which shipbuilding on the Upper Clyde can confidently be continued. It is subject to certain important conditions, but I see no reason why it should not be fulfilled. In Scotland, we must surely concentrate on doing all we can to enable that scheme to get started to work. It would be folly, simply because of disappointment over the facts and the findings of the four advisers, if we were to nullify the prospect of 2,500 firm jobs at Govan and Linthouse with the possibility of future expansion.

Photo of Mr Tony Benn Mr Tony Benn , Bristol South East

What we are asking for are the working documents which lie behind the Report. Will the Secretary of State publish the working documents so that the House can judge the cost of alternative policies which were before the Cabinet when it reached its decision?

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

The Group of advisers was asked to produce a Report urgently in the time before the end of the provisional liquidation. Hon. Members opposite challenged us only last Tuesday to publish the Report, and this we have done.

All who, like me, want to see successful shipbuilding on the Upper Clyde must encourage the co-operation and effort required by us in Scotland to follow up and help the Govan-Linthouse project.

Interest has also been shown by possible purchasers in the Scotstoun and Clydebank yards during the period of provisional liquidation. The prospect of work being continued at one or both with continuing employment must not be overlooked or prejudiced by unthinking reaction. This is a matter for the liquidator. He has the task of disposal. However, the future of these assets should not be ignored in terms of possible additional employment.

In reply to my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward Taylor), the Government do not have closed minds to possible assistance for successor projects.

In the debate on the Consolidated Fund (Appropriation) (No. 2) Bill last Tuesday night, the right hon. Member for Kilmarnock (Mr. Ross), as my right hon. Friend reminded him, said that he was impressed by the quality of the four advisers. He went on to say this: We ought to see that report and what advice is offered to the Government and balance against that the decision that the Government eventually take."—[OFFICIAL REPORT, 27th July, 1971; Vol. 822, c. 381–2.] That is what has happened. The right hon. Gentleman made those remarks late on Tuesday night. Within 48 hours he changed his mind. What caused him to do that?

In the debate last Tuesday the right hon. Member for Bristol, South-East made a comment about employers on the Lower Clyde which caused the Scott Lithgow shipbuilding group to make an immediate comment to repudiate his suggestion. The Glasgow Herald of Thursday, 29th July, contained this report: The Scott Lithgow shipbuilding group on the lower reaches of the Clyde reacted sharply last night to suggestions in the House of Commons that they would be happy to see more unemployment on the Upper Clyde. The claim, by Mr. Anthony Wedgwood Benn, Labour M.P. for South-East Bristol, that the lower reaches management would like to see higher unemployment on the Upper Clyde to improve lower reaches recruiting was dismissed as 'ridiculous'.' His comments are quite unjustified by the facts', a group official said. The right hon. Gentleman has caused quite enough damage to us in Scotland by his mistakes and bad judgment when he was a Minister. On top of the follies which he committed on the Upper Clyde he has now added a suggestion which I can only describe as diabolical.

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

No, in view of the time. The shipbuilders on the Lower Clyde

Photo of Mr Tony Benn Mr Tony Benn , Bristol South East

On a point of order, Mr. Speaker. I rise on a point of order because, when the report in the Glasgow Herald was brought to my attention and I—[HON. MEMBERS: "That is not a point of order."] On a point of order. This relates to a misprint of a single word in HANSARD which I dealt with fully in Scotland and which will be corrected in the bound volume of HANSARD.

Hon. Members:

Withdraw!

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

I am referring to column 353 of the HANSARD issued on Wednesday, 28th July, 1971. If it is incorrect then I withdraw until I see the correct version. [HON. MEMBERS: "Withdraw."] I have withdrawn until I see the correct version.

In the wider context of the situation and the difficulties in West Central Scotland, this area on Clydeside has been singled out for very special help. Since February it has been made a special development area—[Laughter.]. This is not a laughing matter. Already, in the five months since it has been so designated, although that is only a short period, the number of jobs coming in through the I.D.C. application is more than four times greater than in the equivalent period in the previous year—

Photo of Mr William Ross Mr William Ross , Kilmarnock

How many jobs have been lost?

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

—a sign that this is already working.

The right hon. Member for Bristol, South-East is reported in the Press as having made statements which seemed to favour the setting up of communes. Is it his party's industrial policy that men should take over businesses and try to run them? Does he think that this will help British industry in the highly com-

petitive world of today? Or is he simply acting as a demagogue vainly trying to retrieve some plausibility, having himself been responsible for setting up U.C.S., the company whose failure is causing so much anguish in Scotland today? We understand that the Leader of the Opposition is going—[Interruption.]—to Glasgow on Wednesday. Will he—

Photo of Mr Robert Mellish Mr Robert Mellish , Bermondsey

Mr. Robert Mellish (Bermondsey) rose in his place and claimed to move, That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question put accordingly, That this House do now adjourn:—

The House divided: Ayes 247, Noes 280.

Division No. 449.]AYES[16.30 p.m.
Albu, AustenDavis, Terry (Bromsgrove)Huckfield, Leslie
Allaun, Frank (Salford, E.)de Freitas, Rt. Hn. Sir GeoffreyHughes, Rt. Hn. Cledwyn (Anglesey)
Allen, ScholefiledDelargy, H. J.Hughes, Mark (Durham)
Archer, Peter (Rowley Regis)Dell, Rt. Hn. EdmundHughes, Robert (Aberdeen, N.)
Ashley, JackDempsey, JamesHughes, Roy (Newport)
Ashton, JoeDoig, PeterHunter, Adam
Atkinson, NormanDouglas, Dick (Stirlingshire, E.)lrvine, Rt.Hn.SirArthur (EdgeHill)
Bagier, Gordon A. T.Douglas-Mann, BruceJanner, Greville
Barnes, MichaelDriberg, TomJay, Rt. Hn. Douglas
Barnett, Guy (Greenwich)Duffy, A. E. P.Jeger, Mrs.Lena (H'b'n&St.P'cras, S.)
Barnett, JoelDunnett, JackJenkins, Hugh (Putney)
Beaney, AlanEadie, AlexJenkins, Rt. Hn. Roy (Stechford)
Benn, Rt. Hn. Anthony WedgwoodEdelman, MauriceJohn, Brynmor
Bennett, James (Glasgow, Bridgeton)Edwards, Robert (Bilston)Johnson, Carol (Lewisham, S.)
Bidwell, SydneyEdwards, William (Merioneth)Johnson, James (K'ston-on-Hull, W.)
Bishop, E. S.Ellis, TomJohnson, Walter (Derby, S.)
Blenkinsop, ArthurEnglish, MichaelJohnston, Russell (Inverness)
Boardman, H. (Leigh)Evans, FredJones, Barry (Flint, E.)
Faulds, Andrew
Booth, AlbertFernyhough, Rt. Hn. E.Jones, Dan (Burnley)
Bottomley, Rt. Hn. ArtnurFisher, Mrs. Doris (B'ham, Ladywood)Jones, Rt.Hn.Sir Elwyn (W.Ham, S.)
Boyden, James (Bishop Auckland)Fitch, Alan (Wigan)Jones, Gwynoro (Carmarthen)
Bradley, TomFletcher, Ted (Darlington)Jones, T. Alec (Rhondda, W.)
Brown, Bob (N'c'tle-upon-Tyne, W.)Foley, MauriceKaufman, Gerald
Brown, Hugh D. (G'gow, Provan)Foot, MichaelKelley, Richard
Brown, Ronald (Shoreditch & F'bury)Ford, BenKerr, Russell
Buchan, NormanForrester, JohnKinnock, Neil
Buchanan, Richard (G'gow, Sp'burn)Fraser, John (Norwood)Lambie, David
Butler, Mrs. Joyce (Wood Green)Galpern, Sir MeyerLatham, Arthur
Callaghan, Rt. Hn. JamesGarrett, W. E.Lawson, George
Campbell, I (Dunbartonshire, w.)Gilbert, Dr. JohnLeadbitter, Ted
Cant, R. B.Ginsburg, DavidLee, Rt. Hn. Fredrick
Carmichael, NeilGolding, JohnLeonard, Dick
Castle, Rt. Hn. BarbaraGordon Walker, Rt. Hn. P. C.Lever, Rt. Hn. Harold
Clark, David (Colne Valley)Gourlay, HarryLewis, Arthur (W. Ham, N.)
Cocks, Michael (Bristol, S.)Grant, George (Morpeth)Lewis, Ron (Carlisle)
Coleman, DonaldGrant, John D. (Islington, E.)Lipton, Marcus
Conlan, BernardGriffiths, Eddie (Brightside)Loughlin, Charles
Corbet, Mrs. FredaHamilton, William (Fife, W.)Lyon, Alexander W. (York)
Cox, Thomas (Wandsworth, C.)Hamling, WilliamLyons, Edward (Bradford, E.)
Crawshaw, RichardHannan, William (G'gow, Maryhill)Mabon, Dr. J. Dickson
Crosland, Rt. Hn. AnthonyHardy, PeterMcBride, Neil
Crossman, Rt. Hn. RichardHarper, JosephMcCartney, Hugh
Cunningham, G. (Islington, S.W.)Harrison, Walter (Wakefield)Mackenzie, Gregor
Dalyell, TamHart, Rt. Hn. JudithMackie, John
Darling, Rt. Hn. GeorgeHattersley, RoyMaclennan, Robert
Davidson, ArthurHealey, Rt. Hn. DenisMcMillan, Tom (Glasgow, C.)
Davies, Denzil (Llanelty)Heffer, Eric S.McNamara, J. Kevin
Davies, G. Elfed (Rhondda, E.)Hooson, EmlynMallalieu, J. P. W. (Huddersfield, E.)
Davies, Ifor (Gower)Horam, JohnMarks, Kenneth
Davies, S. O. (Merthyr Tydvil)Houghton, Rt. Hn. DouglasMarquand, David
Davies, Clinton (Hackney, C.)Howell, Denis (Small Heath)Marsden, F.
Marshall, Dr. EdmundPendry, TomStoddart, David (Swindon)
Mason, Rt. Hn. RoyPentland, NormanStonehouse, Rt. Hn. John
Mayhew, ChristopherPerry, Ernest G.Strang, Gavin
Meacher, MichaelPrentice, Rt. Hn. Reg.Summerskill, Hn. Dr. Shirley
Mellish, Rt. Hn. RobertPrescott, JohnTaverne, Dick
Mendelson, JohnPrice., J. T. (Westhoughton)Thomas, Rt.Hn.George (Cardiff, W.)
Millan, BruceProbert, ArthurThomas, Jeffrey (Abertillery)
Miller, Dr. M. s.Rankin, JohnThomson, Rt. Hn. G. (Dundee, E.)
Mitchell, R. C. (S'hampton, Itchen)Reed, D. (Sedgefield)Thorpe, Rt. Hn. Jeremy
Molloy, WilliamRees, Merlyn (Leeds, S.)Tinn, James
Morgan, Elystan (Cardiganshire)Rhodes, GeoffreyTomney, Frank
Morris, Alfred (Wythenshawe)Richard, IvorTorney, Tom
Morris, Charles R. (Openshaw)Roberts, Albert (Normanton)Tuck, Raphael
Morris, Rt. Hn. John (Aberavon)Robertson, John (Paisley)Urwin, T. W.
Moyle, RolandRodgers, William (Stockton-on-Tees)Varley, Eric G.
Mulley, Rt. Hn. FrederickRoper, JohnWainwright, Edwin
Murray, Ronald KingRose, Paul B.Walker, Harold (Doncaster)
Ogden, EricRoss, Rt. Hn. William (Kilmarnock)Wallace, George
O'Halloran, MichaelSandelson, NevilleWatkins, David
O'Malley, BrianSheldon, Robert (Ashton-under-Lyne)Weitzman, David
Oram, BertShore, Rt. Hn. Peter (Stepney)Wells, William (Walsall, N.)
Orme, StanleyShort, Mrs. Renée (W'hampton, N.E.)Whitehead, Phillip
Oswald. ThomasSilkin, Hn. S. C. (Dulwich)Willey, Rt. Hn. Frederick
Williams, Alan (Swansea, W.)
Owen, Dr. David (Plymouth, Sutton)Silverman, JuliusWilliams, Mrs. Shirley (Hitchin)
Padley, WalterSkinner, DennisWilson, Alexander (Hamilton)
Paget, R. T.Small, WilliamWilson, Rt. Hn. Harold (Huyton)
Paisley, Rev. IanSmith, John (Lanarkshire, N.)Wilson, William (Coventry, S.)
Palmer, ArthurSpearing, NigelWoof, Robert
Pannell, Rt. Hn. CharlesSpriggs, Leslie
Parker, John (Dagenham)Stallard, A. W.TELLERS FOR THE AYES:
Parry, Robert (Liverpool, Exchange)Steel, DavidMr. Ernest Armstrong and
Peart, Rt. Hn. FredStewart, Rt. Hn. Michael (Fulham)Mr. James Hamilton.
NOES
Adley, RobertChurchill, W. S.Goodhart, Philip
Alison, Michael (Barkston Ash)Clark, William (Surrey, E.)Goodhew, Victor
Allason, James (Hemel Hempstead)Clarke, Kenneth (Rushcliffe)Gorst, John
Amery, Rt. Hn. JulianClegg, WalterGower, Raymond
Archer, Jeffrey (Louth)Cockeram, EricGrant, Anthony (Harrow, C.)
Atkins, HumphreyCooke, RobertCray, Hamish
Awdry, DanielCoombs, DerekGreen, Alan
Baker, Kenneth (St. Marylebone)Corfield, Rt. Hn. FrederickGrieve, Percy
Baker, W. H. K. (Banff)Cormack, PatrickGrylls, Michael
Balniel, LordCostain, A. P.Gummer, Selwyn
Barber, Rt. Hn. AnthonyCritchley, JulianGurden, Harold
Batsford, BrianCrouch, DavidHall, Miss Joan (Keighley)
Beamish, Col. Sir TuftonCurran, CharlesHall, John (Wycombe)
Bell, RonaldDavies, Rt. Hn. John (Knutsford)Hall-Davis, A. G. F.
Bennett, Sir Frederic (Torquay)d'Avigdor-Goldsmid, Sir HenryHamilton, Michael (Salisbury)
Benyon, W.d'Avigdor-Goldsmid, Maj.-Gen.JamesHannam, John (Exeter)
Berry, Hn. AnthonyDean, PaulHarrison, Brian (Maldon)
Biffen, JohnDeedes, Rt. Hn. W. F.Harrison, Col. Sir Harwood (Eye)
Biggs-Davison, JohnDixon, PiersHaselhurst, Alan
Blaker, PeterDouglas-Home, Rt. Hn. Sir AlecHastings, Stephen
Havers, Michael
Boardman, Tom (Leicester, S.W.)Drayson, G. B.Hawkins, Paul
Body, Richarddu Cann, Rt. Hn. EdwardHay, John
Boscawen, RobertDykes, HughHayhoe, Barney
Bossom, Sir CliveEden, Sir JohnHeath, Rt. Hn. Edward
Bowden, AndrewEdwards, Nicholas (Pembroke)Hicks, Robert
Boyd-Carpenter, Rt. Hn. JohnElliot, Capt. Walter (Carshalton)Higgins, Terence L.
Braine, BernardElliott, R. W. (N'c'tle-upon-Tyne, N.)Hiley, Joseph
Bray, RonaldEmery, PeterHill, John E. B. (Norfolk, S.)
Brewis, JohnFarr, JohnHill, James (Southampton, Test)
Brinton, Sir TattonFell, AnthonyHolt, Miss Mary
Brocklebank-Fowler, ChristopherFenner, Mrs. PeggyHordern, Peter
Brown, Sir Edward (Bath)Fidler, MichaelHornby, Richard
Bruce-Gardyne, J.Finsberg, Geoffrey (Hampstead)Hornsby-Smith, Rt.Hn.Dame Patricia
Fisher, Nigel (Surbiton)
Bryan, PaulFookes, Miss JanetHowe, Hn. Sir Geoffrey (Reigate)
Buchanan-Smith, Alick (Angus, N&M)Fortescue, TimHowell, David (Guildford)
Buck, AntonyFoster, Sir JohnHowell, Ralph (Norfolk, N.)
Bullus, Sir EricFowler, NormanHunt, John
Burden, F. A.Fox, MarcusHutchison, Michael Clark
Butler, Adam (Bosworth)Fraser, Rt.Hn.Hugh (St'fford & Stone)James, David
Campbell, Rt.Hn.G.(Moray&Nairn)Fry, PeterJessel, Toby
Carlisle, MarkGalbraith, Hn. T. G.Johnson Smith, G. (E. Grinstead)
Carr, Rt. Hn. RobertGardner, EdwardJopling, Michael
Cary, Sir RobertGibson-Watt, DavidKaberry, Sir Donald
Channon, PaulGilmour. Ian (Norfolk, C.)Kershaw, Anthony
Chapman, SydneyGilmour, Sir John (Fife, E.)Kilfedder, James
Chataway, Rt. Hn. ChristopherGlyn, Dr. AlanKimball, Marcus
Chichester-Clark, R.Godber, Rt. Hn. J. B.King, Evelyn (Dorset, S.)
Kinsey, J. R.Nott, JohnSproat, lain
Kirk, PeterOnslow, CranleyStanbrook, Ivor
Knox, DavidOppenheim, Mrs. SallyStewart-Smith, Geoffrey (Belper)
Lambton, AntonyOrr, Capt. L. P. S.Stodart, Anthony (Edinburgh, W.)
Lane, DavidOwen, Idris (Stockport, N.)Stoddart-Scott, Col. Sir M.
Langford-Holt, Sir JohnPage, Graham (Crosby)Stokes, John
Legge-Bourke, Sir HarryPage, John (Harrow, W.)Stuttaford, Dr. Tom
Le Marchant, SpencerParkinson, Cecil (Enfield, w.)Sutcliffe, John
Lewis, Kenneth (Rutland)Peel, JohnTapsell, Peter
Lloyd, Ian (P'tsm'th, Langstone)Percival, IanTaylor, Sir Charles (Eastbourne)
Longden, GilbertPink, R. BonnerTaylor, EdwardM.(G'gow, Cathcarl)
Loveridge, JohnPounder, RationTaylor, Frank (Moss Side)
Luce, R. N.Powell, Rt. Hn. J. EnochTaylor, Robert (Croydon, N.W.)
McAdden, Sir StephenPrice, David (Eastleigh)Tebbit, Norman
MacArthur, IanPrior, Rt. Hn. J. M. L.Temple, John M.
McCrindle, R. A.Proudfoot, WilfredThatcher, Rt. Hn. Mrs. Margaret
McLaren, MartinPym, Rt. Hn. FrancisThomas, John Stradling (Monmouth)
Maclean, Sir FitzroyQuennell, Miss J. M.Tilney, John
McMaster, StanleyRaison, TimothyTrafford, Dr. Anthony
Macmillan, Maurice (Farnham)Rawlinson, Rt. Hn. Sir PeterTrew, Peter
McNair-Wilson, MichaelRedmond, RobertTugendhat, Christopher
McNair-Wilson, Patrick (New Forest)Reed, Laurance (Bolton, E.)Turton, Rt. Hn. Sir Robin
Maddan, MartinRees, Peter (Dover)van Straubenzee, W. R.
Madel, DavidRees-Davies, W. R.Vaughan, Dr. Gerard
Maginnis, John E.Renton, Rt. Hn. Sir DavidVickers, Dame Joan
Marten, NeilRhys Williams, Sir BrandonWaddington, David
Mather, CarolRidley, Hn. NicholasWalder, David (Clitheroe)
Maude, AngusRidsdale, JulianWalker, Rt. Hn. Peter (Worcester)
Mawby, RayRippon, Rt. Hn. GeoffreyWalker-Smith, Rt. Hn. Sir Derek
Maxwell-Hyslop, R. J.Roberts, Wyn (Conway)Wall, Patrick
Meyer, Sir AnthonyRodgers, Sir John (Sevenoaks)Walters, Dennis
Mills, Peter (Torrington)Rost, PeterWard, Dame Irene
Mitchell, Lt.Col.C.(Aberdeenshire, W)Royle, AnthonyWeatherill, Bernard
Mitchell, David (Basingstoke)Russell, Sir RonaldWells, John (Maidstone)
Moate, RogerSt. John-Stevas, NormanWhite, Roger (Gravesend)
Molyneaux, JamesScott, NicholasWhitelaw, Rt. Hn. William
Money, ErnleScott-Hopkins, JamesWiggin, Jerry
Monks, Mrs. ConnieSharples, RichardWilkinson, John
Monro, HectorShaw, Michael (Sc'b'gh & Whitby)Wood, Rt. Hn. Richard
Montgomery, FergusShelton, William (Clapham)Woodhouse, Hn. Christopher
Morgan-Giles, Rear-Adm.Simeons, CharlesWoodnutt, Mark
Morrison, Charles (Devizes)Sinclair, Sir GeorgeWorsley, Marcus
Mudd, DavidSkeet, T. H. H.Wylie, Rt. Hn. N. R.
Murton, OscarSmith, Dudley (W'wick & L'mington)
Neave, AireySoref, HaroldTELLERS FOR THE NOES:
Noble, Rt. Hn. MichaelSpeed, KeithMr. Reginald Eyre and
Normanton, TomSpence, JohnMr. Jasper More.