Orders of the Day — Development Areas (England)

– in the House of Commons at 12:00 am on 7th December 1971.

Alert me about debates like this

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Hawkins.]

3.37 p.m.

Mr. Fred Pearl:

We recently had a major debate on unemployment; it was a debate of a general character which covered the whole of the United Kingdom. However, we all recognised that unemployment, with all its social consequences and associated human tragedy, affects different parts of the United Kingdom in different ways. Its intensity varies from area to area, from region to region, and also between specific parts of regions; this is true not only of development areas but also of special development areas.

If we look at the general picture we see that for mid-November the total number of registered unemployed in the United Kingdom totalled 970,022. For Great Britain alone the total was 839,430, or 4 per cent. of the total employees. These figures are the highest recorded at any time since before the war—the previous post-war record occurred under a Conservative Administration—in February, 1963—and this shows the national problem which we now face.

As to the periods when the Labour Government had responsibility for dealing with unemployment, I admit that in June, 1970, the seasonally adjusted figure for Great Britain was 561,000, some 2·4 per cent. This was a matter of deep concern to the whole Labour Government. Yet this total, which provides the most accurate comparison of all, has now risen by well over 50 per cent. The unemployment figures tell only part of the story. We must take into account the large numbers of workers who do not register. They include the elderly and semi-retired workers, the self-employed and married women.

We shall concentrate in this debate today on the regions and development areas, since in periods of economic recession the depresed regions of the United Kingdom experience exceptionally high levels of unemployment.

To take the Northern Region, which I know well—I have lived there most of my life and have represented the area in this House since 1945—the figure of wholly unemployed, excluding school leavers, and seasonally adjusted for November, 1971, represents 6·1 per cent.; the North-Western Region 4·4; Yorks and Humberside 4·2; East Midlands 3·1; West Midlands 3·6; and South-East 2·2. In the South-Western Region the figure is running at a rate of 5 per cent.

The Northern Region includes a traditional industrial area with its own peculiar problems. I am thinking specifically of the coal industry, which has a very high call on unemployment. I agree that it is not quite as high as it is in Scotland or in Northern Ireland. None the less, we in the Northern Region believe that it is a serious problem which is bringing hardship and difficulty to many of our fellow citizens. I highlight the Northern Region because we are dealing specifically with England today.

Another worrying feature is that this huge increase in unemployment has been matched by a sharp fall in unfilled vacancies. We have the spectacle of more workers chasing fewer jobs. The total number of unfilled vacancies for adults in Britain is 114,000, and that has to be compared with a total of wholly unemployed, again excluding school leavers, of nearly 840,000. In other words, for every job available there are more than seven men and women out of work.

I can remember arguments in the 1930s about 11 men chasing 10 jobs. That was a philosophy sometimes advocated by certain callous leaders who thought that this was the only way to discipline the workers. I hope that no hon. Member on either side of the House will accept that philosophy today. Nevertheless, there is the spectable of a decreasing number of jobs available, of more people being thrown out of work, and of great difficulties for large sections of the population.

The number of unfilled vacancies is still falling. The total dropped by 5,200 between October and November. Looking again at the regions, it will be seen that the position varies. I have figures for each region of the number of unfilled vacancies for men and women. The Northern Region has 4,900. The North-West has 11,750. The East Midlands has 7,350. The West Midlands has 7,500. The South-East, strange to say, has 50,750.

If we look at the numbers unemployed for each available job, we see that in the Northern Region the number is 17, in the North-West it is 11, in the East Midlands it is 6, in the West Midlands it is 15, and in the South-East it is 3. So again we see that in the Northern Region and the North-West we have an exceptionally serious problem.

Analysing the figures still further, it becomes clear that of the recorded increase in wholly unemployed since June, 1970, of 318,000 approximately 80 per cent. is accounted for by increased male unemployment. There are no fewer than 11 men unemployed for every available job.

We have another serious problem to consider when we examine the unemployment figures, and that is the position of school leavers and of younger people who are unemployed. Here again, there is a continuing fall in the number of vacancies. In the Northern Region there are fewer than 1,300 vacancies. I believe that this is one of the most serious problems that we face in the development areas. It is one which I know from my own intimate contact with my constituents, who present me with some of their worries and difficulties. The problem of the young person leaving school and of the younger worker is one which worries parents considerably.

There are other occupational aspects, quite apart from those affecting young workers. Unskilled workers have been hit badly. A greater proportion of them are unemployed. Even as early as June of this year, skilled workers, too, were beginning to find that jobs just were not there and that the number of jobs available for men were far fewer than the number unemployed.

If we analyse still further the figures affecting the regions, we see how the pattern affects different sections of workers who are unemployed. For older workers, too, the pattern differs in each region. The problem is very serious in the Northern Region. In terms of the percentage of men over 40 who have been employed for more than six months, the average for Great Britain as a whole is 47. The percentage for men over 40 who have been unemployed for more than 12 months is 29. In the Northern Region the corresponding percentages are 59 and 43. In other parts of the North-West the percentages are 43 and 26. In the West Midlands they are 43 and 24. In the South-East they are 37 and 20. So again we see that there are serious problems for older workers in some of our important industrial areas, especially in our development areas. Again, I quote specifically the North—

Mr. J. T. Price:

Serious as all these figures are, will my right hon. Friend make it clear that, while the position in the Northern district is extremely grave and a source of great anxiety to us all, the figures for the North-West are almost equally bad? I have the honour to represent a constituency in Lancashire where large areas have unemployment figures which are more than 50 per cent. higher than the national average and where there is no protection in the shape of development area status. I have in mind, for example, the central Lancashire area surrounding Wigan, where the figures are very serious.

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

I agree with my hon. Friend. I mention the Northern Region because I know it so well. I have quoted figures for the North-West, and my hon. Friend the Member for Chesterfield (Mr. Varley) will concentrate on the North-West and on other regions. I am glad that my hon. Friend the Member for Westhoughton (Mr. J. T. Price) has made his point. It shows that we have an extremely worrying position in many parts of the country. It shows the way in which the industrial area which has been mentioned has been affected by the general recession, which has had serious consequences.

The position varies from region to region, as I have illustrated. It also varies in different parts of an individual region. I have some figures for West Cumberland. In my own constituency, Workington, on the latest figures available, which are for November, the percentage of unemployed is 6·3. In Aspatria, next door in the constituency of the Leader of the House, the percentage is 8·1. In Mary-port, again in my constituency, the percentage is 9·5. In the constituency of my hon. Friend the Member for Whitehaven (Dr. John A. Cunningham), the percentage in Cleator Moor has gone up to nearly 13. Even within some of the development areas there are specific problems, and they have created considerable human difficulties for the families concerned.

Dealing with the North-East, one has only to see the number of firms which are cutting down and the way in which redundancies are increasing. I have before me an excellent survey which was carried out by the Journal, a Newcastle newspaper. It cannot be described as a Socialist paper. I think that my hon. Friends from Tyneside and the North regard it as a Conservative paper. I hope that Ministers have seen it. It gives a fantastic account of the tragedy, and reports how there is now a growing queue, with firm after firm, small and large firms in various industries, making redundancies.

I shall not weary the House with this list. I am sure that every hon. Member representing a constituency in the Northern Region knows it very well. But the Government must be made aware of it. In my constituency there are examples of factories which, because of rationalisation and perhaps because of recession and a lack of confidence in the Government's investment policy, have had to close down. I think, for example, of the Cumberland Cloth Company. It is a story which is repeated on a much larger scale in the North—

Photo of Sir Harmar Nicholls Sir Harmar Nicholls , Peterborough

The right hon. Gentleman refers to lack of investment because of lack of confidence in the Government's policies. However, the right hon. Gentleman ought to place on record that, as regards action within the orbit of the Government, no more has ever been done by way of tax reliefs and so on than that which we have seen coming from the present Government.

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

I am surprised that the hon. Gentleman should say that, because he knows that the Government are responsible for it. His Government have that power. They have reversed certain policies which were achieving success in the development areas. We want to know what the Government will do about investment grants, regional employment premiums and other matters affecting the development areas. I hope that the hon. Gentleman will support my plea for some specific action now before we have a major tragedy and unemployment gets out of hand. I am sure that hon. Members who know the areas will be able to show similar figures for the North-West, the South-West, and other areas where there is now a high incidence of unemployment. The Government have had a negative approach to the development areas and the regions where help is needed.

The Minister for Industry should be aware that it was his Government which abolished investment grants in favour of a system of tax allowances. That decision is not better. It has created harm in the regions and discouraged investment on the part of certain firms. If the hon. Gentleman looks at the long list of firms there and speaks to people engaged in industry he will find that what I am saying is right.

The Government announced the cutting of the regional employment premium in 1974. This, again, has created a measure of uncertainty. We need some statement today about the Government's intentions on the matter.

Moreover, the Government have relaxed controls on industrial and office building. That means that the development areas are not placed in such a favourable position compared with the more prosperous areas.

We have the Government's attitude to public expenditure, which affects infrastructure. There have been periodic announcements about expenditure on infrastructure works in the regions. I know that these announcements have been made, but it has never been clear whether these were genuine additions to public expenditure programmes. Infrastructure in the regions is important. In the North—I am sure the position is similar in other regions—we need to speed up road development and improve amenities and the social services. By improving the areas in this way we can attract other industries. That is good policy. We want to know what the Government intend to do.

Specific matters have been raised today with the Prime Minister. We had the Government's scrapping of the planned Inland Revenue Computer Centre at Washington. This matter was raised by my hon. Friend the Member for Chester-le-Street (Mr. Pentland), and also by my hon. Friend the Member for Houghton-le-Spring (Mr. Urwin), who, when Minister for the Northern Region, sought to speed up development. There was then a measure of urgency which is now lacking in the Government's administration. Here are some examples where there are difficulties.

I ask the Secretary of State for the Environment: why start to boast about new town development in the South-East and the Southern Regions? Is it not time to concentrate more on some of the regions where we could profitably have some new schemes? Why should we have this imbalance, this dangerous imbalance, with the development of the Channel Tunnel and possible entry into the Community? However, I will not deploy that argument.

Mr. J. T. Price:

Why not?

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

There is a fear on the part of many people in the fringe areas that attraction to the South would harm the North and other regions. I do not want to develop that too much.

Mr. Price:

I apologise for intervening again. Since my right hon. Friend is deploying his argument so forcefully about the lack of investment and lack of drive on the part of the Government in encouraging investment, why not use the valid argument that the unsettlement caused to investors and the people who control finance in this country by uncertainty about the Common Market has been one of the biggest unsettling factors in the process of pouring the necessary capital into new investment to provide new employment?

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

I am sure that my hon. Friend has made a very effective speech. I do not dissent from it. It is his second contribution today, but very effective.

Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

Order. There are many hon. Members who want to speak.

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

Regional development affects not only pure industry but agriculture, an industry in which I always take an interest. Why did the Government destroy the Pennine Rural Development Board which was set up to encourage not only farming but tourism in the important hill and upland areas? It was an action of petty political spite and prejudice. The Minister knows it and must accept as much responsibility for it as the Minister of Agriculture, Fisheries and Food. That was a scheme which I thought would help to rejuvenate a very important part of the Northern Region. It was backed by the landowners, the farmers, the farmworkers and all shades of political opinion. Yet this Government destroyed something which, in the end, we shall need if we are ever to develop these areas and areas in Mid-Wales and the South-West. Why did they do it? This is the kind of attitude which we have witnessed time and again—a casual approach to a major problem with no positive policies in the real sense forthcoming.

I suggest that the Government should reverse their attitude towards investment grants and that there should be a definite statement on the regional employment premium.

I note that in the Financial Times of Thursday, 2nd December, there is a report: The Government is believed to be in two minds about its decision to scrap the Regional Employment Premium in 1974. That is contained in a report of the meeting of the N.E.D.C. on 1st December. Let us know today. Surely the Minister, when he replies, can end people's anxieties on this matter.

Added incentives should be given to firms already in development areas which wish to expand existing industry. I know that in Cumberland new jobs have been created in the past by improving the older industries in the area, and the new jobs created have been about equal to those which have been created by bringing in new industries.

Will the Minister take note of what the T.U.C. has put before him? The T.U.C., as reported in the Financial Times and other national newspapers, has suggested certain positive proposals which have been presented to the Prime Minister and to the N.E.D.C. Will the regional economic planning councils be given a more positive rôle? We need a more vigorous regional policy to restore business confidence. Hon. Gentlemen opposite and Ministers should not be doctrinaire about public and private enterprise. In my constituency a new factory has been opened in partnership between British Leyland and the National Bus Company. Here is an example where, through good partnership between two sections of industry, public and private enterprise, we have a valuable project which will bring more work to an area which is seriously affected.

In the debate on the Gracious Speech I referred to the Bolton Report on Small Businesses. Is there to be any action on that? After all, many of the firms in the development areas in the Northern Region which provide employment are small firms, sometimes employing fewer than 200 people. These small firms have been going through a very difficult period. The Bolton Report suggested that a special section should be set up in the Minister's Department. Will it be effective, and which Minister will be responsible? [AN HON. MEMBER: "It has been set up."] We have not heard of it doing anything yet. I pressed this matter during the debate on the Queen's Speech, because it is a matter which must be given more publicity. Even though a letter has been written to my hon. Friend on this issue, I believe that it must be publicised much more, and that we must be told what incentives are to be given to small firms.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

May I draw the right hon. Gentleman's attention to a fact which he seems to have missed? My right hon. Friend asked me to undertake this responsibility, and I have frequently commented upon the Bolton Report. It would be better if the right hon. Gentleman were to read the newspapers rather than accuse me of not having given publicity to this issue.

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

The impact has been minimal. Small businessmen do not know the extent of the Government's activity in this respect.

Photo of Gerald Kaufman Gerald Kaufman , Manchester Ardwick

If the Under-Secretary of State claims to be responsible for this matter, why does he not answer letters sent to him by hon. Members instead of being so dilatory about doing so?

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

Last week the T.U.C. called for a £1,000 million boost to the economy, and it was right to do so. We can deal with the problem only by getting the economy right at national level. That is the way to reduce unemployment and sustain growth. Development area policy can work effectively only if the economy is not static but dynamic and there is sustained growth accompanied by positive investment.

A return to recession will hurt all the regions, and more especially the development areas which, traditionally, have presented difficult problems because of the structure of older industries and weaknesses in the infrastructure supporting the industrial complex. At times people have thought the problems intractable, and that no solution seems possible, but I believe that we must never despair. The problems can be solved if we have the will to solve them.

I know that hon. Members have different views about how we should approach the problem. There is a fundamentally different political and philosophic approach by the two sides of the House. There is, inevitably, a conflict between those who seek a market approach—the argument being that only a free competition economy will in the end allocate resources, manpower and capital where we want them to be—and those, mainly on my side of the House, who advocate a much more interventionist policy under which the Government have to take specific, planned action.

Successive Labour Governments have favoured the latter course. Their aim has been to take more jobs to the workers and to remedy industrial weaknesses in specific regions. I make no apology for the Labour Government's records from 1945 to 1950 and from 1964 to 1970. Right hon. and hon. Gentlemen opposite promised to deal with the problem quickly—virtually at a stroke. Indeed, six weeks before the General Election the Secretary of State for Employment said that if the country could get back to Tory policies the unemployment situation would be a great deal better than it was at the time.

The Secretary of State for Employment has promised to do something, but we are extremely suspicious about what will be done, and that is why we want a specific statement from the Government today. This is, after all, a human problem of great magnitude, and we have to ask whether history is to repeat itself. Are we again to see the tragedy of the old distressed areas, which many of us knew so well? The Government cannot escape their responsibility. It is their policies which have failed. I believe that the Government must change course now, or get out.

4.4 p.m.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I know that when the right hon. Member for Workington (Mr. Peart) speaks on this topic he does so with sincerity. I believe that both sides of the House want early action to reduce the unemployment figures. I know that the right hon. Gentleman represents an area of high unemployment and that for virtually all his life he has lived in an area which, in spite of the efforts of both parties, has remained one of high unemployment.

I agree with the right hon. Gentleman when he says that it would be a mistake to think that the regions which have suffered from high unemployment for 30 or 40 years cannot be transformed and become areas of vigorous growth with a good quality of infrastructure. I believe that it should be the duty of all Governments to try to achieve that objective, and I shall endeavour to illustrate that this Government have done a great deal that will assist in the long-term development of the regions.

The right hon. Gentleman was a member of the previous Administration and he knows that his Government, during their last period of office, witnessed a considerable increase in unemployment in the development areas. From 1966 to June, 1970, when they went out of office, unemployment in the South-West rose from 2·3 per cent. to 3·8 per cent. On Merseyside, it rose from 2 per cent. to 3 per cent., and in the northern area it rose from 2 per cent. to 4·3 per cent. I agree that unemployment is higher now, but the fact is that the Labour Government, with all their good intentions, and despite the efforts they made, experienced a substantial increase in unemployment levels in all the development areas.

I recognise that the figures have increased since we have been in office, but I think that hon. Members on both sides will agree that the main periods of improvement, in industrial terms, for the regions have always been during periods of national economic growth, and nobody can argue that this Government inherited a period of fast economic growth. Indeed, we inherited considerable economic stagnation, but already there has been a major turn round in certain spheres of the economy.

When I first took office as Minister of Housing and Local Government, the building industry was extremely depressed, bankruptcies were increasing, and the housing programme was in sharp decline. All that is being reversed. When we took office the motor industry, which is an important employer, both directly and through all the subsidiaries surrounding it, was in a considerable period of depression. Indeed, there was a great deal of speculation about whether, in the long term, the motor industry would remain in business at all. That situation has been turned round, and the motor industry is now booming.

The figures for consumer spending, published only yesterday, show a considerable upturn, and I believe that the country faces a unique opportunity, in economic terms, of getting a period of sustained growth. I say "unique" because the balance of payments position is strong—for a variety of reasons—reserves are strong, and the basic capacity to improve the productivity of British industry is considerable. It is against that basic background that one has to look at what policies it is right to pursue in the development areas.

The right hon. Gentleman stressed the importance of improving the infrastructure of the regions. That is fundamental to the real long-term prospect of the regions, because we shall not get the movement of industry and economic activity to regions that are ugly and crippled by the industrial scars of the past. A great deal of progress needs to be made there in a period of high unemployment, and when we have the resources to enable us to take action it is the Government's duty to do so, and I should therefore like this afternoon to tell the House of some of the considerable changes which are taking place, and which have taken place over the last 18 months in this respect.

Recently, I toured the right hon. Gentleman's constituency and discussed with local authorities the problem of clearing derelict land. Despite all their good intentions, the clearing of derelict land declined during the last three years of office of the Labour Government.

In 1967–68, 1,003 acres of derelict land were cleared. In 1968–69, that figure was reduced to 790, and in 1969–70 it was further reduced to 608. When I took over the problem of dealing with derelict land, I believed that the subsidies and grants provided and the knowledge possessed by my Department were such that we should do everything possible to encourage local authorities to go ahead, on a massive scale, with clearing derelict land. I cleared the programme for loan sanction and put it in the priority area. I said to local authorities that there was no limit to the amount of loan sanctions they could have.

Further, I decided that the six counties with the worst problems should be activated at both district and county level to do more than they had in mind. I organised six conferences, one in the right hon. Gentleman's own county, in which I am glad to say that the county councils and the district councils all co-operated. I discussed with them the variety of problems and snags that they encountered and I urged them to set ambitious targets and promised them that, if they did, the high targets would be maintained and that there would be no problems as regards loan sanctions. I have already visited Durham, Cumberland, Lancashire and Northumberland. These changes are having a dramatic effect.

Photo of Mr Thomas Urwin Mr Thomas Urwin , Houghton-le-Spring

I am sure that the right hon. Gentleman is not seeking to be deliberately unfair in talking about the progress which he claims has been made in clearing derelict land since he took office. However, was there not a continuous upswing in the programme, at least in the previous two years, and was there not a momentum which would have continued regardless of anything that the right hon. Gentleman did?

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I have given the figures—1,003 acres in 1967–68, 790 acres in 1968–69, and 608 acres in 1969–70. I am talking about clearance in the development areas. Therefore, in that period there was a decline in clearance in development areas.

A transformation is now taking place. I am pleased to be able to tell the House that in the first six months of this year we have approved the clearance of 50 per cent. more derelict land than was cleared in the whole of 1969–70. It is a very substantial change when in six months we do 150 per cent. of what was done in the last complete financial year under a Labour Government. Therefore, nobody can complain that we have been lethargic or that we have not done everything possible to speed up schemes for the clearance of derelict land.

Grants paid this year will be double what they were in 1969–70. There are no financial restrictions. I have urged everybody to fix as ambitious targets as possible.

Photo of Mr Arthur Blenkinsop Mr Arthur Blenkinsop , South Shields

The Secretary of State is being rather unfair in comparing approvals with the amount of clearance done.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I am telling the House about clearance done. Grants paid this year will be double what they were in 1969–70—that is, for work actually done. For approvals the figure is very much greater. Nobody can deny—the hon. Gentleman, with his interest, would not want to deny—that we are achieving a substantial acceleration in the clearance of derelict land. The more local authorities set ambitious targets and multiply the figures, the more I shall be pleased and the more the Department will be willing to help.

Another topic of immense importance to all of the development areas is that of housing, which in both the private and the public sector was in decline when the Labour Government left office. In the private sector it is now substantially increasing month by month.

In the public sector there are now two spheres of help that we have made available in terms of finance which should be able to transform expenditure in this sector. The first is the new slum clearance grant which I back-dated to this year. Local authorities in all of these regions can now go ahead as speedily as possible with slum clearance knowing that there is every financial incentive for them to do so.

I am pleased to be able to tell the House that in the discussions that took place with the T.U.C. last week I stated my anxiety that local authorities should get on with this and the T.U.C. has co-operated in every way through its local trade councils by urging local authorities of whatever political complexion, to get on with slum clearance.

Within a day of the Bill being published, my right hon. Friend the Minister for Housing and Construction wrote to the 133 local authorities with the worst problem of slums and also wrote individually to the leaders of those councils aking them to bring forward as fast as possible their slum clearance programmes in the light of this subsidy being available.

I have conveyed the list of areas to the T.U.C. I know that the T.U.C. will co-operate with me and will bring pressure to bear on all local authorities to undertake this task as speedily as possible. This could have a considerable impact in the development areas.

One of the remarkable improvements of this Government in terms of infrastructure has been the decision we made as regards development areas substantially to increase for a two-year period the improvement grant on older properties. We estimated that this would cost £40 million over two years. I put a two-year time limit on that intentionally, because I wanted everybody to speed up the process and get on with the job to take advantage of the existing levels of unemployment, to take up as much labour as possible, and to reduce unemployment in the building industries.

The effects of putting a two-year limit on and of increasing the grant in this way have been dramatic. In the development areas in England, already local authorities have decided within the two-year period to modernise 103,000 prewar council houses. In the Northern Region, in the first nine months of this year the improvement grants granted are 40 per cent. up on the first nine months in 1970. The improvement grants in the first nine months of this year are double what they were in the first nine months of 1969. In every part of the country where these extra grants have been available there has been a very considerable upturn.

Photo of Gerald Kaufman Gerald Kaufman , Manchester Ardwick

The right hon. Gentleman will know that Manchester has one of the very worst housing situations in the country and that Manchester's latest unemployment figures show that there are more workers out of a job in the construction industry than in any other industry. Therefore, why will he not help us in housing and employment by extending the increased improvement grants to the Manchester area?

Photo of Mr Peter Walker Mr Peter Walker , Worcester

Because I believe, in keeping with the Labour Government's policy, that it is right to give specific additional incentives to the development areas. This was the policy of the hon. Gentleman's party. It does not come well from a member of the Labour Party, when the Tory Government discriminate in favour of such areas, to accuse the Ministers concerned of not giving exactly the same facilities to the other areas. We are injecting £40 million in home improvements to these areas. The extra impetus nationwide that we are putting behind improvement grants means that in Manchester, as elsewhere, there is a substantial upturn on the previous figure.

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

This is a very sore point with the greater Wigan area, which gets no grant to help it to overcome its unemployment problem. The social dereliction there makes the area more unattractive and it gets no help to deal with urban renewal. There are 85 areas receiving grants to deal with the unemployment and which benefit from the extra grants for urban renewal although these areas have a lower rate of unemployment than has the Wigan area. Therefore, Wigan is discriminated against on both counts. Is not this patently unfair?

Photo of Mr Peter Walker Mr Peter Walker , Worcester

It could be argued that every incentive that has been given to a development area was unfair to areas immediately outside that area. This applied under the Labour Government, as under this Government. Already a substantial proportion of the United Kingdom is within development areas. The more that area is extended, the less the total effect on redressing the imbalance. I recognise the difficulties that some of the surrounding areas have.

The result of the increased grants announced only on 22nd June last has been that in Sunderland there have been 317 applications in the private sector since June, compared with 163 from the beginning of the year to June. The council has decided to improve 2,400 council houses and complete them within the period of the grant—that is, June, 1973, instead of June, 1975.

The North-East Housing Association has decided to improve its 200 houses within the same period. Barrow has 500 applications in hand as a result of these measures and has had to take on extra staff to deal with them. In Wallasey there has been a great increase in applications, and they are now coming in at the rate of 100 a month. Wallasey, too, has had to take on extra staff to deal with the applications which have come in.

We are making massive progress with the improvement of older houses in development areas. That progress is being made as a result of direct decisions by this Government.

Photo of Mr Thomas Urwin Mr Thomas Urwin , Houghton-le-Spring

The right hon. Gentleman says that progress is being made in house modernisation as a direct result of the efforts of the present Government. This is fallacious. The vehicle to enable progress to be made was provided by the Labour Government—the Housing Act, 1969—and that vehicle is being used by the right hon. Gentleman. He has simply increased the grants. We should like to know how much of the additional grant has been eroded by inflation since the right hon. Gentleman took office.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I appreciate that the hon. Gentleman's interruptions are designed to be helpful. He is right to refer to the 1969 Act, but the enormous upturn to which I referred has come as a result of this Government having increased by 50 per cent. the grant which the Labour Government considered to be adequate. That is the difference between the two sides.

I come to a number of other important matters which should be borne in mind. One is a problem from which all industrial areas suffer, and that is the industrial pollution of rivers. Here again the Conservative Government, my Department, have decided that in this period of substantial unemployment it is right massively to increase investment in these localities. [interruption.] I heard an hon. Gentleman opposite say that it has taken a hell of a long time. It has taken us a lot less time to do something whereas the Labour Government sat for six years doing nothing. [Interruption.] When I came to office they were dithering on every decision that needed to be made to improve our rivers.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

In their last year, when the hon. Member for Newcastle-upon-Tyne, West (Mr. Bob Brown) was a Minister, the Labour Government agreed to expenditure on sewerage schemes in development areas worth £4·6 million. We are agreeing in the coming year to treble that figure as a result of decisions we have made affecting the development areas. To argue that we have taken 18 months to treble their figure of expenditure, when they took six years to achieve the miserable total of £4·6 million, comes ill from hon. Gentlemen opposite.

We have made considerable capital investment in improving the basic infrastructure. The Labour Government, following the example of their Conservative predecessors, quite rightly agreed that there was a need for tremendous improvement in communications in the North-East. A great deal was done in road building, and a high level of expenditure was reached. I pay tribute to them for that achievement.

We are not only continuing that high level of expenditure but in addition are planning to add £19 million by bringing forward schemes under our infrastructure proposals, and £25 million will be provided in the recently announced measures by my Department to bring forward the maintenance programmes on trunk and other roads. Thus, in addition to the programme of road building for the development areas which the Labour Government considered adequate and which they laid down in public expenditure programmes, we are adding over the next two and half years further expenditure of £44 million.

In a period of high unemployment in these regions one should take advantage of the situation by going forward on a massive scale with infrastructure programmes, and that is what we have done and are doing. I will be examining with local authorities other ways, perhaps by more minor infrastructure improvements, of achieving these ends.

Right hon. and hon. Gentlemen opposite who were members of the Labour Administration will know that one of the difficulties of bringing forward schemes of this kind is that major capital works take time to get into operation. However, there may be a range of minor environmental improvement schemes that can be brought into operation and done more immediately, and I am entering into discussions with the local authority associations to see if we can find a formula for doing this.

I come to a number of major industrial questions which are of considerable importance to development areas, one affecting the constituency of the right hon. Member for Workington who rightiy mentioned the important Leyland National Bus Company development which was started by the Labour Government. The right hon. Gentleman pointed out that there was no reason to be doctrinaire about it. I agree with him. I hope that the scheme will succeed, certain decisions made by the present Government will considerably help it to succeed.

I have in mind two particular decisions that I made. The first was the decision to double the bus grant. The second was the decision to make sure that the National Bus Company was provided with funds to ensure that it did not run into cash flow difficulties in ordering a lot more buses. This has enabled the National Bus Company to order 500 buses in the first two years of the operation, which will provide jobs for 400 people In the right hon. Gentleman's constituency.

I do not claim credit for the factory because that was achieved by the Labour Government. However, I do claim credit for having made a substantial injection of public expenditure by doubling the bus grant which the Labour Government set, ensuring that the finances of the company are adequate to place a subs tantial order, so getting the factory off to a good start.

Photo of Dr Jack Cunningham Dr Jack Cunningham , Whitehaven

On the question of the Leyland National Bus Company development at Lillyhall, may I ask the right hon. Gentleman to bear in mind the importance of the A66 development? Can he explain why that part of the road which has not been the subject of objections—the part from Lillyhall to Cockermouth—has not been given the go ahead immediately? This would have served two purposes, first to expedite the completion of the project and second to provide much-needed employment this winter in West Cumberland.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I appreciate the point of the hon. Gentleman's intervention, but it is difficult to settle the matter until one knows the total route of the road. The whole question of tendering and contracting is involved. I have tried to speed up the public inquiry, and that will now take place in January. I assure the hon. Gentleman that I realise the importance of a decision being made in this matter, and I promise that I will do everything I can, within my Department, to hasten the decision-taking process.

What I was saying about our decision on the bus grant is of considerable importance to employment in the North-East. It is also important from the employment point of view nation-wide because this doubled bus grant means that a lot of public transport will become viable when certain bus services might otherwise have ceased to continue.

Another industrial decision to which I referred is of immense importance to the North-East. This is the decision to place an order for two destroyers and two fleet tankers with Swan Hunter on Tyneside. The bringing forward of this decision will provide 1,400 jobs direct and a considerable amount of indirect employment. Earlier in the year the Cammell Laird yard was provided with an order for two destroyers.

A number of other decisions have also been taken. For example, considerable financial assistance has been provided for mineral development, and this will help with the problems of the South-West. Likewise, the decision to continue with forms of financial grant for the hotel industry in the development areas is of importance to the South-West and will give encouragement to tourism in other areas. An encouraging feature in the North-East is the steady improvement in the hotel facilities that are being made available. Hon. Members on both sides will agree that the substantial growth that is taking place in industrial training is vital.

I argue, therefore, that in all the spheres in which we can make improvements substantially and speedily in the infrastructure of the development areas, the present Government have acted more effectively, more in total and more speedily than any of their predecessors.

Photo of Mr John Nott Mr John Nott , St Ives

The road programme is a major infrastructure problem in the South-West. We are therefore delighted with the preparation pool for which my right hon. Friend is responsible. However, what is confusing to us is that we get letters from the Ministry indicating that the priorities are by no means decided, and we seem constantly to learn that although we are in the preparation pool, we have no idea when we will get into the programme.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

When I recently announced the major programme which affects the South-West I made it clear that all the schemes that we were announcing were intended to be completed by the early '80s. My hon. Friend will be pleased to hear, therefore, that all these schemes will be completed by that time. The setting of priorities and of dates when projects shall start depends on a number of factors, such as public inquiries and the compulsory purchase of land, some of which are not within our control.

I understand the claim of hon. Gentlemen opposite that in a period when unemployment in the development areas has risen sharply, it is correct for them to urge that much more should be done. But I must remind the House—

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

I asked specifically about the regional employment premium. Are we to have a statement on that today?

Photo of Mr Peter Walker Mr Peter Walker , Worcester

In terms of regional employment premium and any matters of this kind, my hon. Friend the Under-Secretary of State for Trade and Industry will comment on the various industrial incentives which will continue to bring expansion.

The unemployment situation was rising and in some areas doubling during the last Administration. I hope that hon. Members will compare the action of this Government with those winter works programmes which the previous Government considered adequate to meet the rising unemployment in those periods.

This Government can say that, in 18 months, we have tried to bring about a much faster expansion of our economy, reduced taxation by £1,400 million, reduced Bank rate, which the previous Government increased, ended the credit squeeze which the previous Government introduced, and abolished the hire-purchase restrictions which they imposed. We have injected, additional to the programmes which they had in mind, £160 million extra on infrastructure, £40 million extra on house improvements, £70 million extra on naval shipbuilding, £150 million on accelerated depreciation allowances, £100 million on bringing forward the investment programmes of the nationalised industries and £60 million on the additional benefit of Government expenditure—a total of £660 million of additional expenditure, which compares remarkably well with the odd £17 million and £20 million which, during a winter's unemployment, the previous Government considered adequate.

Therefore, although I accept that everybody should be concerned at the rise in unemployment, they should also accept that this Government are doing more to reverse that trend than any previous Government.

4.32 p.m.

Photo of Mr Eric Ogden Mr Eric Ogden , Liverpool, West Derby

The Secretary of State obviously came out of his corner with the intention of making his speech coolly, quietly and apparently reasonably. He maintained that attitude until the last few moments. When this Secretary of State is being most reasonable, most quiet and cautious, he is no less formidable. He was deliberately keeping the temperature low.

When the right hon. Gentleman gives this information, he cannot then "do a Pontius Pilate" and say that the problems of the development areas are being dealt with. He cannot come here only as the Secretary of State for the Environment. The problems of the development areas range wider than his Department. Whilst we accept and welcome many of the things he listed, they will help mainly in the long term and not very much in the short term. The environment is a long-term consideration.

This debate should be an opportunity to discuss not only the problems of the development areas but their opportunities, possibilities and advantages. I am often annoyed to hear glorious parts of the countryside described as "grey", "assisted" areas or "intermediate" areas.

Naturally, this debate is an extension of our two previous debates on unemployment, this time concentrating, I hope, on specific geographical areas, which we call development areas. We will not forget that there are more than 1 million unemployed, more than 3 million underemployed and many millions more fearful about their present or future employment. This is the price for Conservative policies, or lack of policies, or changing policies over the last 18 months. In Worcester, Bexley, Altrincham, Bournemouth, even in Cirencester and Tewkesbury, people are beginning to count the cost.

With no disrespect to the Secretary of State for Trade and Industry, even Knutsford was more prosperous with its last Member outside the Labour Government than with its present Member inside the Tory Cabinet, and Knutsford is one of the more prosperous parts of the North-West.

There is a bitter irony in the fact that the tragedy of unemployment lies heaviest on those areas, those parts of the country, those countries within these islands, which were and are most loyal to the Labour Government—Scotland, Wales, the North-East, the North-West, Merseyside and the North Midlands. Perhaps this is one reason why a few weeks ago the Minister for Industry said that "we should not get obsessed about unemployment." Perhaps he was facing reality and acknowledging that the unemployed are hardly likely to vote for this Government in any way.

That was some weeks ago, and the Government's policies have changed much since. It has amazed me to see hon. Members opposite asking their Government, in debate after debate, to do more, to spend more money, to abandon the policy of non-intervention and cutting public expenditure. They were asking in November for different policies from those which they had supported when this Government came to power. Yet these were the non-interventionists, the hard-liners and the champions of cutting public expenditure.

We were told just a few days ago that the Government are now entering their "adaptable phase", that their policies are "being adapted". We and the country know that the long-term problems of unemployment and of employment will be solved only with a Labour Government committed to using all the resources, skills and abilities of all the people all the time.

On 26th November I put down a Motion about Liverpool and Merseyside—a wide and reasonable Motion which could have been accepted even by this Government—drawing attention to the pride, the abilities and the achievements of Merseyside. So often it seems that when we call for more help for these areas we overlook the advantages, abilities and achievements which are already there. The Motion put in balance some of the things for which I hoped.

The main reason for the Motion was the simple fact that Liverpool and Merseyside are "news". Almost anything that happens there is reported on the six o'clock news and in the daily papers. If 20 people strike on Merseyside for a very good reason, the fact is featured on the news—although the reason is seldom given. If 2,000 people come out in Cheltenham, no one hears about it. The picture which is presented is not all that it should be. The daily papers are sometimes a daily horror: good news is not news and bad news is news.

Of the major industries on Merseyside, three are motor cars, the docks and construction. Some of my hon. Friends, particularly my hon. Friend the Member for Liverpool, Walton (Mr. Heffer), have more knowledge of these than I. Those three industries are particularly prone, because of the nature of their management and organisation, to industrial troubles. The record of any of the three is no worse on Merseyside than in any other comparable part of the country, but we hear about industrial trouble on Merseyside and not elsewhere. Those engaged in managing these industries would also say that when we are working, as we are 99·99 per cent. of the time, our output, quality and workmanship are second to none in the United Kingdom. Many industries on Merseyside have been established there for 10, 20 or 30 years and are expanding.

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

It is right to discuss this Merseyside labour image. A very large proportion of the population of Skelmersdale in my constituency are Liverpudlians. They are so conscious of this bad and maligned image of Liverpool people that some of them have told the shop steward in a textile works that, come hell or high water and no matter what the provocation—and they have endured a lot—they will not strike again, even though in the past they have been driven to it. That should be put on the record.

Photo of Mr Eric Ogden Mr Eric Ogden , Liverpool, West Derby

I am most grateful to my hon. Friend for his remarks. The House will be aware that many of the people from Liverpool and Merseyside have established themselves in Skelmersdale in my hon. Friend's constituency and as good workers. Quite apart from the industries already in this area, there have been industries on Merseyside for many years which have every intention of staying there. Their industrial relations record is excellent and they are expanding. Equally, many new industries have come into the area. Too often the impression has been given that all we do in the development areas is to wait for help from outside; what we are doing, in fact, is to ask for more aid to help ourselves; we are not sitting about waiting for charity from outside.

Let me give one example which has emerged from correspondence and some publicity, for which I am grateful to the Liverpool Post and Echo. It concerns a firm called Sanders Tube Crafts Ltd. of Burscough, Lancashire. Six years ago there was a danger of redundancy of steel fabricators and structural engineering contractors in a tube company in Merseyside. Four of the employees decided to form their own company. They found a disused airport, acquired an old hangar and now have contracts all over the country and are already exporting.

In the letter to me the four directors said: Our industrial relationship record speaks for itself, never a stoppage or strike since we commenced production six years ago. We opened the factory with a work force of eight and now employ fifty, fabricating all the products of Tubewrights Ltd., Kirkby, and are now producing to our own designs and providing design services to others.Most importantly we have retained on Merseyside the high skills and craftsmanship of Tubular Fabrication which we are certain has a great growth potential, and in a small way contributed to providing employment for workmen which are second to none.Our main reason for writing is because we feel our employees are truly representative of the workers of Merseyside, mainly unheard of, but carrying out a grand job of work which press and television seem to fail to publicise. No doubt this story applies to many other firms in the area. That is a record of achievement of which to be proud.

Great cities have great needs. We know the facts of economic life in the North-West. In an area which has done so much to create the wealth of the nation and which has had so small a share of that wealth, it is right that some should now come back to us.

I would suggest two courses of action to the Government. Let us take the case of the North-West Industrial Development Association, a first-class organisation which is supported by chambers of commerce, local authorities, trade unions and industry. It receives no Government help or grant for the work it is doing. The Association carries out work which is complementary to that being done by the Department of Trade and Industry; it puts out publicity, the same kind of literature and programmes, selling industry without Government help. Some other development associations receive such help. A sum of £10,000 for the North-West Industrial Development Association would be well spent in that particular way.

Communications are vital to economic success. In Liverpool and Merseyside we are at the hub of communications. Half the population of the country lives within 50 miles. Half the industry of the country is within 50 miles of our area. Communications—the M6 and rail—are good. There is the proposal for the Lancashire—Yorkshire motorway, parts of which have been completed, and it is within the right hon. Gentleman's powers to speed up the Liverpool—M6 link, to create better rail communication between the new Seaforth Terminal—into which Admiral Peynton sailed yesterday—the M6 and the Channel Tunnel.

There is one other way in which the right hon. Gentleman could help, and that is with Government contracts. How often have hon. Members from the North-West picked up the telephone only to be told that: The 'leens' from Lenden are engaged; please try later. If such communications could be improved, this would help not only Plessey. English Electric, but also the post office, and encourage the expasnion of industry out of the South-East. Plessey has received a contract for £9 million, which will undoubtedly help the present unemployment situation; at least it will not permit it to get worse, but Plessey will not be able to take on another worker.

Office employment is the great growth industry of today. We have in the centre of Liverpool an office block like an advance factory waiting for tenancy. The Ministry of Defence has a lot of people in Liverpool. The Government could transfer more to Merseyside. There should be a speed-up in grants to Liverpool Corporation to enable the City to go ahead with building the civic offices complex. It would be a helpful injection of capital, and bring employment at once.

I turn now to a more controversial subject, and I must be careful about the words I use—the Common Market. My understanding of the official policies of the three major parties in this House is that the majority in all three are in favour of entry and full membership of the European Economic Community on acceptable terms and subject to the sovereign will of the British Parliament. That "sovereign will" was contained in the 1969 Labour Party National Executive statement. With a Labour Government we would have had interim legislation to make the transitional period more acceptable and to provide the help that ought to be provided.

Accepting the uncertainty of the future of any legislation and the risk that if legislation is delayed some industrialists will delay investment, thus affecting employment I believe that, whether we join Europe or not, the attraction of Europe will become greater. The assistance to the development areas will have to be greater than in the past if we are merely to be able to stay where we are. My hon. Friends have made many approaches to the Government, and it is apparent that the Government are now on their "adaptable" phase.

The right hon. Gentleman cannot merely say that he is doing all he can on environment but that he has no responsibility for other Departments. We have made many good suggestions. Some have been accepted. We hope that the Government will have the good sense to accept them all.

4.47 p.m.

Photo of Mr Robert Redmond Mr Robert Redmond , Bolton West

I am grateful for the opportunity to follow the hon. Member for Liverpool, West Derby (Mr. Ogden). He is not as good as he might have been at impersonating that horrible voice on the telephone telling him that lines from London were engaged. He did it more nicely than she did.

I take up the hon. Gentleman's point about the Common Market. During the month of August I spent a great deal of time with industry in my constituency, which is not far from his, asking about the situation. I found that the general public had a fear about this attraction of the South-East, the Channel Tunnel—what I call the Golden Triangle of London, Paris, Bonn. It was the industrialists of Lancashire who drew my attention to the fact that the main port of export to the Common Market would be Hull and we in the North-West are extremely well placed, especially with the motorway complex being provided for us. The Common Market does not start at Calais, but has tended to move round to the north and the east because of the enlargement of the Common Market.

I would follow the hon. Gentleman in his description of the image of Merseyside. I am the first speaker from the back benches in this debate whose constituency is not in a development area. Therefore, I do not want to join in what I call the "me, too" syndrome. I have never belonged to this. There is no point in creating more and more development and special development areas, more intermediate areas because the only result would be that the effect of development area status would be minimised. That is common sense. Equally, I have never been sure that the money spent in promoting development area status has necessarily done as much as it might have to cure chronic unemployment.

I almost apologise for mentioning this next matter, but I have never had a satisfactory answer to it. I refer to the English Electric Napier factory at Kirkby, in the constituency of the Leader of the Opposition. That factory was receiving all the development area status help it could get—regional employment premium, everything. Yet when General Electric took over English Electric, instead of concentrating its efforts there where it would get all these benefits, it closed the factory. If special development area status means so much, why did General Electric not take advantage of it?

Photo of Mr Eric Ogden Mr Eric Ogden , Liverpool, West Derby

The simple fact was that when General Electric took over English Electric it decide to concentrate all its turbine blower equipment manufacture in one place. The Kirkby factory was manufacturing about one-tenth of this equipment and the other factory the remaining nine-tenths, so it made sense to move the one-tenth to the nine-tenths.

Photo of Mr Robert Redmond Mr Robert Redmond , Bolton West

That does not answer the point I was making. Here was a large factory by any standards, getting all the development area benefits. However, it is a more sensible answer than I have received. In the past I have been told how people went to see Weinstock and the Prime Minister and so on, and I was almost tempted to say that All Harold's Heffers and Wedgwood Benns Couldn't put Napier together again. If a line is drawn on a map and it is said that the area on one side is a development area, then this can only be to the detriment of the area on the wrong side of the line. The last Government ought to have accepted the recommendations of the Hunt Commission, which would have given intermediate area status to a wide area of South Lancashire and at the same time included Merseyside in that area. That would have meant relegating it from development area status to intermediate area status.

The hon. Member for Liverpool, West Derby is probably right, and he has certainly done a jolly good public relations job for Liverpool and Merseyside this afternoon. I know that Merseyside has its problems, but at the moment—and I stress those words—I do not think that any form of special development area status or whatever will be much help to Merseyside. I say that more in sorrow than in anger. My experience of talking to industrialists in London and the South is that they would not move to Merseyside at any price. I have not met a single industrialist who would even consider Merseyside for a new factory or for expansion.

It is a wonderful thing to hear the truth about Merseyside, and I was glad that the hon. Member for Ince (Mr. McGuire) came in as well. I have good reason for saying that, because Merseyside is rather near to Bolton and I do not want any of this bad image rubbing off on to Bolton. I would rather have the good image which the hon. Member has given.

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

The hon. Member's last point highlights why it is necessary for us in Lancashire, who know that the figures about industrial unrest on Merseyside are much exaggerated and that the Merseysider is much-maligned, to speak up in defence and rebut this canard. The statistics about industrial unrest are much exaggerated. In my constitutency the labour figures are marvellously good, and 90 per cent. of that labour force is from Merseyside.

Photo of Mr Robert Redmond Mr Robert Redmond , Bolton West

I am supporting the hon. Gentleman, and whenever I meet industrialists from the South I try to persuade them to consider Lancashire for expansion, bearing in mind that, naturally, my first priority is to Bolton. I know the hon. Gentleman's constituency well, I worked in it and close to it for a long time, and he is absolutely right. Like most Lancashire places, it has the finest people in the world, and I do not want there to be any argument about that. There are far too many people down here who think that the world stops at the Watford by-pass.

Let us not talk too much about Merseyside; let us come to the hinterland, to Bolton, Wigan, and such areas. We have an industrial record second to none in the world. I am proud to have spent all my industrial working life in Lancashire, and extremely proud to have the honour of representing Lancashire people in Parliament.

We might also pay a tribute to what has been done by the local authorities in some Lancashire towns. I hope that I shall be forgiven if I mention my own constituency again. There is a gentleman called Mr. Albert Parkinson who is the industrial development officer for Bolton, and he has done an enormous amount to help industrial development in the town. Because of such work the town has been able, until recently, to absorb the redundancies arising from the rundown of the textile industry.

Once the Government's measures begin to bite, Bolton will recover its position, but we have to do more than that, we have to overtake the situation now developing because of the textile rundown. Places like Bolton need help. I do not say that they should be given intermediate status, development area status or anything else. It has always been my view, and I have been saying since before the General Election

Photo of Mr Robert Redmond Mr Robert Redmond , Bolton West

—that the Department of the Environment has more to do for places such as Bolton than the Department of Trade and Industry. My right hon. Friend the Secretary of State for the Environment has told us a success story today. The great trouble with towns with no special area status at all, such as Bolton, is the existence of ancient buildings, the "dark satanic mills", which need to be cleared up. If we could do this we would have sites available for new industry in what is already the most attractive place in the world for industry. I have been told, and I have no reason to doubt it, that if the greater Bolton area could be given about £500,000 it would do a great deal to achieve a forward surge in the improvement of the infrastructure of the town.

That figure should be compared with the sums of money mentioned in a Writen Answer yesterday to my hon. Friend the Member for Bedford (Mr. Skeet) which show that the nationalised industries have received no less than £9,562 million from the taxpayer since 1945. Of that, £2½ million has been written off, and I would hazard a guess that a great deal more will be written off before we are much older. How many jobs has that money created? If it has created any, how much has it cost per job? What has it done for the infrastructure of the regions, which is the main problem?

I have said that the Department of the Environment can help Lancashire more than the Department of Trade and Industry. I have a copy of the Local Employment Bill, presented recently in another place by my noble Friend the Lord Chancellor. This, I understand, is a consolidation Measure and does not create any new law. Clause 8(6) derives from the Industrial Development Act, 1966, and the Local Employment Acts, 1960 and 1970. The subsection says: Where the Secretary of State for Trade and Industry is of opinion, with respect to any locality in Great Britain, that the economic situation in the locality is such that the exercise, in relation to land therein, of the powers conferred by the foregoing provisions of this section would be particularly appropriate with a view to contributing to the development of industry in the locality, he may by order specify it as a derelict land clearance area, and those provisions shall have effect, in relation to land in a derelict land clearance area as they have effect in relation to land in a development area or intermediate area. That suggests to me that my right hon. Friend the Secretary of State for Trade and Industry could do a great deal more to clear derelict land in the non-development and non-intermediate areas.

If I have any criticism of what is going on it is that everything—the housing legislation, the bigger improvement grants and so on—goes to the development and intermediate areas, and nothing goes to areas that may well have greater dereliction and bigger problems than the development areas have. I hope that my hon. Friend the Under-Secretary of State for Trade and Industry will try to clarify the position that I have outlined and tell us whether my interpretation of the Clause is right.

I have a further suggestion as to how we might get rid of the redundant, dark, satanic mills in our region. [Interruption.] I have seen many dark, satanic mills, and if we can only get them down that will be a great improvement.

Photo of Mr Eric Ogden Mr Eric Ogden , Liverpool, West Derby

The mills about which Blake wrote were the mill wheels of God, grinding slow but exceeding small, not the Lancastrian mills, which Blake had never seen. There are times when a good, sound, old cotton mill is a very good first step for development.

Photo of Mr Robert Redmond Mr Robert Redmond , Bolton West

Fair enough. We have some jolly good, solid, first-class buildings in Bolton which have been up for quite a long time and make excellent factory premises now. But there are also some dark, satanic mills of the type I have in mind, whatever the original author may have meant.

I suggest a dual policy of a stick and a carrot. Let us talk first about the stick. We should introduce legislation saying that derelict industrial premises which are out of use and empty will be rated in, say, three years' time. Then we introduce the carrot, which is to tell the firm owning such premises, "If you demolish them within three years we shall lend you the cost of the demolition and clearing the site—on the understanding that if you redevelop or sell the site you must repay the loan." That would clear sites fairly quickly, and remove some of the mills which are nothing more than playgrounds for vandals and could eventually become dangerous.

I am certain that in the long term the best way in which we can help industry in Lancashire and other parts of the country is not so much by having development area status as by giving help to the smaller firms. During the recess I spent a great deal of time talking to industrialists in my constituency. I found that the growth areas were among the small companies, some of which had not been going for very long. Their great problem is that they have to generate their own risk capital. I am sure that the entrepreneurs of Burscough will agree that they cannot go to the markets for money but must make it, and we must let them keep it. We had a good start in the reduction of corporation tax, and I hope that that can continue.

The Government are right not to yield to pleas for wider and wider development areas and other special status. We should not necessarily have everything going into development and intermediate areas. There are other areas, Bolton in particular, that need some help.

5.4 p.m.

Photo of Mr Frederick Willey Mr Frederick Willey , Sunderland North

This has become a very melancholy debate. We had a slap-happy speech from the Secretary of State for the Environment without a single constructive, original thought. In reply to his peroration, I will say only that larger doses of the wrong medicine are unlikely to provide the cure.

It is time we realised that development area policy and our whole approach to the problems of the development areas must be much more comprehensive and direct. The B.B.C. recently gave a disgracefully distorted picture of Sunderland on television, which led my constituents to think that the B.B.C. could not care less about our difficulties. It is not a sufficient answer merely to complain. If we are serious about regional policy, we should be calling for the restructuring of the B.B.C. and the breaking of its monolithic, London-based structure in favour of a vigorous regional organisation.

We have also recently suffered from the decision to locate the V.A.T. headquarters in Southend and the decision not to proceed with the computer centre at Washington. Again, it is not sufficient merely to complain about these decisions. If we are serious about regional policy, we should insist that we disturb the concentration of civil servants in London and get a rational dispersal of the Civil Service.

It is fashionable nowadays to talk about infrastructure, but it is not sufficient to talk about it in terms of marginal palliatives, as the Secretary of State did in talking about the preferential treatment we receive on improvement grants, for example. We want a basic application of development area policy in the drawing up of Departmental programmes. We want the application of development area policy in school building programmes, hospital programmes and the rest and even, for example, in the remuneration of doctors and dentists.

It should be our deliberate aim, planning perhaps over 10 years, to remove the unacceptable disparity between the deprived and the privileged regions. We have now, and for a long time have had, geographically two nations—the regions that are development areas and those that are not. We should acknowledge that the development areas are also the deprived areas, and it is their deprivation which is the major discouragement to their full development.

But we should not only be more comprehensive in thinking about development area policy; we should be more direct and more interventionist. I acknowledge that we have already spent enormous sums in financial aid to the development areas, and that that aid has not altogether been without effect. But I am sure that if it had been given more discriminatorily, more selectively, it would have been far more effective. Sunderland needed after the war, and needs today, a new, large-scale industrial complex. To achieve this the Government must be prepared to put in millions of pounds but they would be millions far better spent than the millions already wastefully spent in attracting dubiously viable, variegated, footloose industries to the region, and far better spent than the millions so thinly spread as to have only marginal effects.

We should also think about the social effects of what we are doing. Average earnings in the North-East are only 79 per cent. of the national average. This is a result of the new industries we have attracted to the region; we now have men unemployed and women working. The fact that we have these low average earnings compared with the rest of the country affects our service industries and the whole character of the region.

In the recent debate on unemployment, my right hon. Friend the Member for Battersea, North (Mr. Jay) pleaded for a new advance factory building programme. I support him; this is a more direct development area policy, but we must also recognise the present position. In my constituency there are already three advance factories empty and idle, and several smaller factories empty and idle. The time has come to be realistic and to put production into those factories. If private enterprise fails—and the Minister assured me yesterday that it has failed and that there have been 57 unsuccessful applications—we cannot afford to allow this public capital to stand idle and we must intervene and put in publicly-financed production.

I welcome the statement of the Chancellor of the Exchequer about the nationalised industries. I urge him to go further, to take a leaf out of the Italians' book and to direct nationalised industries to place their contracts in the development areas. He should direct the major Government spending Departments to do the same. This would be a great fillip to the development areas. Much more important, we should recognise that what is good for the nationalised industries is equally good for private enterprise. If it is for the good of the country to direct the nationalised industries to expand their capital investment, so it is for the good of the country that large-scale private enterprise should expand its capital investment.

Our major need is to devise ways and means of supporting investment in the private sector and providing for partnership. The need for this is clearly shown in the shipbuilding industry. The implementation of the Geddes Report was successful, but only as a holding operation. Meanwhile, we have been outstripped again by our competitors, who have been able to formulate ways and means of serving a national purpose through a major industry. We need this sense of purpose in British industry today. It means the acceptance of public participation and leadership in industrial enterprise. It means a recognition that we should not try to arrest technological innovation and change, but also a recognition that we shall not succeed without structural unemployment unless there is a measure of public intervention.

The major issue which the Government should be considering now is the ways and means of doing this. It cannot be done by civil servants with red tape and bureaucratic formulae. I put this suggestion again to the Government. Let us have an experiment in the North-East; let us have a North-East development corporation; let it be grant-aided so that it will have the widest discretionary powers. We are always being asked to help ourselves. Give us a chance to do so.

5.15 p.m.

Photo of Mr John Sutcliffe Mr John Sutcliffe , Middlesbrough West

I welcome the opportunity to follow the right hon. Member for Sunderland, North (Mr. Willey). I agree wholeheartedly with the last part of his speech in which he advocated a North-East development corporation. I take him to be advocating in the regions more power, more authority and less advice only. I could not agree with him more in what he said on this, and in what he said in other parts of his speech.

Over the last 10 years the Government have pumped not far short of £450 million into the Northern Region as a whole, and Tees-side has shared in this infusion. I must speak on behalf of Tees-side because there is no one else on this side of the House to do so. It is no good our making nice calculations of a little less or a little more by way of incentives, calculations as to whether the Government should be thinking in terms of grants rather than allowances. Such nice calculations will not now answer our regional problem, certainly not in the North-East, and I doubt whether they will anywhere else. The latest figures for Tees-side show that nearly 12,000 men are out of work as against 533 vacancies. If my hon. Friend the Member for Tynemouth (Dame Irene Ward) will excuse my pointing this out, the unemployment figure on Tees-side is now higher than it is on Tyneside.

Photo of Miss Irene Ward Miss Irene Ward , Tynemouth

I am delighted for my hon. Friend to point out anything that is accurate. On the North-East I try to help him in the same way as he tries to help us, but I must point out that Tees-side has greater possibilities for the future than the Port of Tyne. Tees-side has, I understand, much more land. I want to know what is to be done for the Tyne as well as for the Tees, so that we get a proper balance.

Photo of Mr John Sutcliffe Mr John Sutcliffe , Middlesbrough West

I was not trying to pick a quarrel with my hon. Friend. She is far too formidable for me to seek consciously to do that. I take her point. Obviously, one has to look at the prospects, but I wish she had waited to hear what I had to say.

Although Tees-side does not have the special development area status which Tyneside has, and although Tees-side now has a greater unemployment problem than Tyneside, I do not believe that it is the lack of S.D.A. status which is creating this excessive unemployment on Tees-side, nor do I believe that the unemployment will be cured by giving Teesside this status.

I ask the Government to do four basic things. They relate to the decision which is about to be made on the British Steel Corporation investment programme, the decision on North Sea oil, the dispersal of the Civil Service, a study of which has been proceeding for some time, and the underlying imbalance in the structure of the Tees-side area.

First, on the British Steel Corporation investment programme, Tees-side in the foreseeable future must continue to depend on basic industry to provide jobs for men. The situation for men over 40 is particularly tragic. Half of all men unemployed in this area are over 40, and they are the hard core of the men who have been unemployed for a year or more. It would be wrong to make this vital decision on the B.S.C. investment programme on political grounds, but, if it were to be made on political grounds, the social problem on Tees-side is as grave and gives as great cause for concern as it does anywhere, either further north or further south.

If one looks at the decision in the light in which it ought to be made, on commercial and technological grounds, no one could deny that there is an overwhelming case for siting the whole of the proposed steel complex alongside the new Redcar ore terminal. I ask the Government to make this decision, to make is quickly and to go for Tees-side.

I ask the Government for another decision which is equally important, and that is to ensure that the North Sea oil is brought ashore in Tees-side. This is important for the country at large and vital to our region.

These two decisions will do an immense amount to restore the regions prospects. However, these decisions by themselves are not enough.

I come to the point which has been made both by the hon. Member for Liverpool, West Derby (Mr. Ogden) and by the right hon. Member for Sunderland, North in regard to growth prospects in office employment. In one year, in the period to April, 1971, some 3,485 Civil Service jobs were dispersed from the South-East. This figure does not particularly impress me since it scratches only the surface. There are hundreds of thousands of non-industrial posts which are not connected with policy-making but which are functional. These are equivalent to the old administrative and clerical grades. These jobs are concentrated in the South-East.

I have had correspondence with my hon. Friend the Parliamentary Secretary to the Civil Service Department—and I wish he were on the Front Bench to hear this debate—which leads me to feel somewhat gloomy about the results of the study being made into the dispersal from the South-East of Civil Service Departments. My hon. Friend said that it would be important for there to be face-to-face meetings with Ministers, but added that it would be difficult in the present state of communications to see how Government Departments could operate from as far North as Tees-side. I do not see why give could not set up a television network in which there could be face-to-face meetings between Ministers in London and civil servants in the North-East. Although the North-East may be a long way off as a matter of distance, it is no longer a long way off in terms of time. When one sets against these arguments the enormous savings to be made in cost of accommodation, living expenses, and so forth; when one remembers the enormous benefits in development areas flowing from an infusion of this kind of Civil Service white-collar work in terms of jobs for those leaving school and others; when one bears in mind the better balance that it will bring to the community in our area, particularly in Teesside—it seems to me the Government must not let us down when it comes to announcing their decision on any dispersal of the Civil Service following the study which is now being undertaken. Tees-side in the last four years has not had a net increase in this kind of work of more than 100 lobs a year at the most.

My last point relates to the desperate need for an infusion of Civil Service work in Teesside in order to correct the imbalance in the whole social structure of the community there, because this affects our ability to help ourselves and to attract manufacturing and other pobs. We have not in Teesside a university, nor do we have a research establishment, nor proper employment opportunities either in public or private administration or indeed in finance, commerce and the professions generally. As a result, the social scene is lopsided. We are a society which is out of balance. This fact is reflected in the average income per head, which is only 79 per cent. of the national average, and the gap is widening. The level of income in an area such as Teesside and in the Northern Region as a whole is depressing the whole environment. It makes the local authority standard of provision for our people lower, and the area in general is made inferior by a lower level of wealth and consumption.

It is here that regional policy has basically failed, and it will continue to fail even though a growth or expansion in the economy is achieved such as has not been achieved during the past eight years. This is why I so wholeheartedly agree with what was said by the right hon. Member for Sunderland, North, and, indeed, this is why we have to go for a new tack, for a radical change, for decentralisation, for authority to be given to the regions and for a minimum reserve of powers in London. Out of greater responsibility and greater power to spend money will come the kind of results for which we have been asking, and, indeed, for which we have been pleading with every Government over the past 10 years.

It is not that we do not know what needs to be done in the North; we know this only too well. Perhaps we have not all the answers to help us to achieve what we want to see, but at least if we know the problem and see what is happenip on the spot in the North-East we shall get better results than those here in London who have other areas on their minds and do not know our problems as we ourselves know them.

5.28 p.m.

Photo of Mr James Tinn Mr James Tinn , Cleveland

; Like many of my hon. Friends, I was struck by the sudden change of tempo towards the end of the Secretary of State's speech. He protested too much. But his protests amounted to little more than what has come to be a customary catalogue on these occasions of the actions which the Government claim to be taking to revive the flagging economy.

The right hon. Gentleman used the word "injection" over and over again; it seems to be the "in" word on the Government side. He said that there would be an injection of this and an injection of that. The right hon. Gentleman reminded me of a doctor standing over the body of one of his patients, vigorously protesting that he had injected more chemicals into the corpse but had no responsibility for the poor man's condition although he had died from neglect. Although the patient is not dead, the economy shows singularly little sign of responding to any of the measures which the Government claim to be taking. If the economy is not dead, the lack of reaction takes a great deal of explaining.

But I do not simply want to make party points, and, indeed, I would not have done so had it not been for the last five minutes of the Secretary of States speech.

I wish to speak more in the vein of the hon. Member for Middlesbrough, West (Mr. Sutcliffe), and, in a constructive way, to approach the problem of a constituency which is trying to find practical solutions. While we did not welcome the hon. Gentleman's entry to this House, ready tribute must be paid to the way in which he has worked with other hon. Members with constituents in the area. It has always been customary for Labour Members representing Tees-side constituencies to work closely together, but my colleagues and I appreciate how the hon. Gentleman has crossed the party boundary on constituency matters and been only too ready to work with us. We respect the hon. Gentleman for that, even though we shall fight against him on other occasions, not as a person but as the representative of a Government and a party which we abhor.

I look first at the problems of my constituency east of Tees-side, at those of the East Cleveland area. It is necessary to point out, when one is discussing the problems arising from coalmine closures in Durham and in other parts of the country, that the last of the ironstone mines which explained the very existence of the steel industry on Tees-side closed a decade or two before closures in the Durham coalfield began. There is a lingering problem of unemployment as a result which recently has been worsened by the understandable but none the less unwelcome decision of the British Steel Corporation to cease its iron and steelmaking activities at Skinningrove, even though the finishing stages of production are being retained.

The two together add up to a massive problem for the area, and the Government did nothing to help by their action over investment grants and the Cleveland Potash Company. That company is providing essential work in the area and will supply minerals to the country, resulting in import savings, when the plant is in full operation, of over £30 million a year. The company has been crippled as a result of losing £6 million in investment grants by a decision taken arbitrarily, without justification, and against every speech from the Government side as well as from this side both in Committee and in the Chamber.

The people of East Cleveland recognise that, the nature of the area being what it is, the need to travel is inevitable. However, if people are expected to travel, they need reasonably decent roads over which to travel. While I am sorry that the Secretary of State is not in his place at the moment, if he has gone back to his Department to hasten decisions on one or two of the matters to which I am about to refer and which other hon. Members have requested we shall forgive him.

Photo of Mr James Tinn Mr James Tinn , Cleveland

I agree that the right hon. Gentleman needs it. For that reason, I shall be generous to him. I was very glad when the right hon. Gentleman announced the other day in reply to a Question of mine his approval of the compulsory purchase order for the South Tees Parkway. But there are other projects. On the A173, for example, there are two. The first is a link between Skelton and Brotton and the second is between Guisborough and Skelton. Local authorities in my area feel that these developments are crucial to the future wellbeing of the area, together with the proposed extension of the A174 to Brotton and Loftus. The Guisborough by-pass has been on the cards since 1966. I have urged the previous Government and the present Government about it. I hope that my efforts will meet with success very soon. It may be that we shall receive some assurances this evening.

Cleveland is a quickly expanding area, and these antiquated roads are a seriously inhibiting factor to it, as they are to the development of Teesport, which is not only important to the Northern Region but already has achieved national importance with a volume and value of dry cargo handled, ignoring its considerable oil imports, which makes it rank very high in the list of United Kingdom ports. Whatever may be said of Liverpool, Tees-port is second to none in terms of labour relations. There are no strikes, and there are very good productivity agreements.

Moving to the western part of my constituency and Tees-side, I echo what the hon. Member for Middlesbrough, West said in countering the common impression which is too often shared, even in the North, that Tees-side is a naturally prosperous area. Anyone making a helicopter journey over the area will see signs of prosperity on both sides of the river. The area contains the largest petrochemical complex in the world, and there are oil refineries on both sides of the river. It has an aura of prosperity. It has the appearance of a place which is going somewhere. To some extent, it is.

However, the development which has been coming to Tees-side for the last decade or so has been very heavily capital-intensive. The result has been a serious unemployment problem throughout the area. Under the present Government it has worsened rapidly. For the first time in my recollection, the unemployment rate on Tees-side is higher than that on Tyneside. It may be that I shall be told that there are still twice as many workers actually unemployed on Tyneside. That is quite true. However, in Wearside, which was so vigorously defended by my right hon. Friend the Member for Sunderland, North (Mr. Willey), the numbers in the area, recognised to be a serious problem, are lower than those of Tees-side. By any standards, Tees-side has a problem, whether it be looked at in terms of absolute numbers or of the unemployment rate. Yet it is denied special development area status. The Government cannot continue to dodge the issue. Until now they have referred to Tees-side as an area having special problems. Of course it has special problems. But saying that they are simple does not wish them away. We want to know what the Government propose to do about them.

The special nature of Tees-side's problems is, first, the capital-intensive nature of the industry. Arising from that, perhaps, is the fact that a different kind of labour is beginning to be necessary in order to operate and service these highly technological industries and their equipment. Major industrialists on Tees-side feel strongly that we need to be looking at the kind of industrial training that we provide. It is no longer just a matter of training in the traditional skills for an area such as Tees-side, but of training men in technological skills and to service the new technologically-based industries. Furthermore, we need some expansion of the technical colleges in the area, and I hope that sooner rather than later we shall have a favourable decision to go ahead with a university on Tees-side.

I enter again, as I have done before in this Chamber, an urgent plea for a favourable and early decision, preferably before Christmas, on the British Steel Corporation's proposal for a multi-million pound steel complex at Redcar. There is a site which has been cleared of slag-heaps. An ore terminal is being constructed. There are deep-water facilities. There is a labour force which has co-operated in the nationalisation of its industry to its own cost in terms of jobs, on the implicit understanding that steel has a future on Tees-side. That future must be called in question if this major development goes anywhere else. If the Minister can give me some encouragement or hope on at least this point, he will make not only my constituents but everyone on Tees-side much happier tomorrow morning when they read about it.

5.40 p.m.

Photo of Mr Robert Hicks Mr Robert Hicks , Bodmin

I hope that the hon. Member for Cleveland (Mr. Tinn) will not think it remiss of me if I do not get involved in his local controversies vis-à-vis Tyneside versus Teesside and, indeed, versus Wearside. I represent a constituency in the South-West which has its own parochial problems vis-à-vis Devon and Cornwall and Plymouth, and so on. It is to these areas that I wish to address the majority of my remarks.

Approximately 75 per cent. of the Bodmin parliamentary division is located within the South-West Development area. The remainder is situated within the Plymouth Intermediate Area.

The South-West Development Area is a region characterised by higher than average levels of unemployment, lower than average levels of income, a limited variety of employment opportunity, and with few modern growth industries represented. But, above all, it is an area where the rate of population growth is low and where large numbers of young people annually leave the region, in many instances never to return to live and work.

Because of these factors, and as I am by profession a geographer who lectured on such subjects before entering this House, I warmly welcomed the acceptance in the early 1960s of the introduction of the concept of regional planning and development in this country, since the primary purpose, as I see it, of having effective regional policies is to bring about a more balanced economic development in the country as a whole, so that each and every one of our regions both contributes to and shares in the national prosperity.

It is thus with genuine regret that I have formed the opinion that the South-West Region has not been allowed to reap the rewards which enlightened regional planning could have brought it. This is largely for two reasons. The first relates to the basic regional structure of the South-West. I am sorry that on the Government Front Bench there is no Minister from the Department of the Environment, because this concerns that Department.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

I should not like my hon. Friend to feel that my right hon. Friend is being discourteous. He has had to leave for another engagement. I hope my hon. Friend understands that anything he says will be listened to and faithfully reported by me to my right hon. Friend.

Photo of Mr Robert Hicks Mr Robert Hicks , Bodmin

It was in no way meant in that light. However, in my subsequent remarks I shall be developing the question of the definition between the Department of Trade and Industry on the one hand and the Department of the Environment on the other relating to regional aids, techniques and policies. Hence, my paraphrasing remarks.

The South-West Region, as at present defined, is in my judgment far too large. Very little imagination and foresight was shown when the original boundaries were drawn up. It comprises six counties: Gloucestershire, Wiltshire, Somerset, Dorset, Devon and Cornwall. The regional capital is Bristol, which is nearer to London than to Penzance in its own region. Therefore, as we go about our work in the Bodmin Parliamentary Division Bristol is just as remote to us as Whitehall ever is.

I suggest that the region is, in fact, two regions: an eastern part, based on Bristol, Bath, Gloucester, Cheltenham and Swindon, urban and industrially based, including a fair share of growth industries, and a western section largely dependent upon agriculture and horticulture, fishing and tourism, with only scattered pockets of industrial development. To suggest that these two sections are complementary to one another and so should be designated as one is, I believe, a mistake.

Furthermore, now that the Severn Bridge is in operation there is increasing evidence that the Bristol-Severnside industrial region will move much closer to the South Wales industrial region. In fact, I predict that within the next 20 years this latter region, Bristol, Lower Severnside and South Wales, will form a great and formidable industrial complex whose economic hinterland will cross and completely ignore the existing regional boundaries as they now stand. In other words, what I am asking the Government is: How can one hope for the various regional measures which we must have to achieve the desired effect if the basic framework for the implementation of these policies is lacking in the context of the South-West Region.

The existing situation confirms this trend. Within the South-West Region the present level of unemployment is 4 per cent., but within this very large geographical area there are marked variations with one obvious characteristic: that is, the further west one travels within this region the higher the incidence of unemployment and the lower the average level of earnings, so that in Devon there is an unemployment figure of approximately 5½ per cent. and in Cornwall the figure approaches 7 per cent. In fact, within my constituency the average level is, regrettably, of the order of 7½, per cent.

It was in recognition of this situation that the previous Government designated most of Cornwall and parts of North Devon as development areas. Subsequently, the area covered by the Plymouth exchange received intermediate status, and recently the Government have extended that intermediate area to include the Tavistock and Okehampton exchange areas.

This leads me to my second main criticism of the Government's regional policies and development area concepts: namely, the form of that Government assistance.

At the end of the previous Government's tenure of office, it was estimated that about £300 million was being fed into the development and intermediate areas mainly in the form of grants of varying kinds, S.E.T. rebates, and regional employment premium. I seriously question whether that is the most efficient and most effective way in which to use this vast sum of money, particularly in the South-West Development Area. We are not an old industrial region whose traditional economic activities have declined. We are an area which is largely rural in character and is based upon occupations such as agriculture, fishing and tourism, with only scattered pockets of light industry. That is why techniques such as the S.E.T. rebate and R.E.P. were not really appropriate to solving our difficulties. Hon. Members will recall that, originally, to be eligible for those payments one had to be involved in manufacturing, but the fact is that only about 20 per cent. of the 88,000 males employed in the South-West Development Area are engaged in manufacturing.

That is why I welcome the change of emphasis by the Government, to spend more money on improving the infrastructure of the region itself. It allows the Government greater powers of selection and greater flexibility. What I am trying to say is that it is preferable to spend money on improving the physical framework of the region itself—roads, housing, home improvement grant schemes, schools, training and re-training programmes—so that the region itself is made more attractive to industrialists, while at the same time there is an improvement in the standard of living and in the levels of employment opportunities for the people already living there. It also helps to reduce the number of employed in the area. Furthermore, it helps to improve the quality of the environment for those living there.

This evening I want to take this opportunity to stress to the Government that this is the correct approach to the problems of the South-West, but to stress also that time is not on our side. Our greatest single need is for improved communications. I appreciate that the total expenditure on roads in the South-West during the current financial year and for the next four years will be about £200 million—that is 11 per cent. of the planned road expenditure, and is a big improvement on the previous situation—but I remind my right hon. Friend and hon. Friends that roads are the lifeblood of the South-West, whether one sees them in the context of industry, agriculture or tourism. My plea, therefore, is for the Government to quicken the pace of our road development programme.

We are promised that a dual carriageway will link Plymouth with the motorway network sometime in the middle 'seventies, but my plea this evening is that this road should be extended into Cornwall as quickly as possible. Work on the Liskeard bypass is due to start in October, 1972. I gather that the preparatory work is well advanced. Why cannot we quicken the pace for the start of this programme? I understand that later this month draft proposals are to be made for the Bodmin bypass, and again I ask why cannot we quicken these up? Hon. Members who have spent a holiday in Cornwall will no doubt recall the hours they spent trying to get through the Borough of Bodmin itself. In addition to those two major schemes, there are other major and minor schemes involving the A30 and the A38.

Apart from the question of communications, there are a limited number of precise proposals concerning the South-West to which I should like to draw the Minister's attention, and about which I know from personal experience as a Member of Parliament. The first concerns the need for the Plymouth exchange area to have full development area status. That was recommended in the Tress Report—Professor Tress being the former Chairman of the South-West Economic Planning Council. I believe in the concept of growth points, and, although I serve a constituency on the western side of the Tamer, I recognise that in the economic context Plymouth is a major growth point. If Plymouth is doing well, then we in the surrounding areas derive the benefits of the economic spin-off.

Second, consideration should be given to the siting of Government offices in the South-West.

Third, I ask the Minister—and he will be aware of my motives for doing so—to examine the techniques whereby financial assistance is given to companies already located in the area. The Minister will be aware of the position of two companies to which I have drawn his attention since 18th June, 1970. Both companies are major employers of labour, and one hopes that with an increased cash flow they will be able to get over what I hope are short-term difficulties. After so much money, time and care has been spent on siting factories in development areas, it would be a shame if they were to go to the wall at a time when the nation as a whole was going through economic difficulties.

My fourth and final point relates to Government training and retraining centres. This topic has already been mentioned, not only today but in earlier debates, and I hope that the South-West will not lose out when the new places are created.

The South-West Development Area has two main priorities. The first is the whole question of communications. Both the A30 and the A38, which are our lifeblood, need improving at the fastest possible rate. Our approach should be: Help us with the means, and we can put our own house in order.

The second need is for the formation of a genuine South-West economic planning region comprising the counties of Cornwall and Devon and the western parts of Somerset and Dorset. There is a good precedent, for in my right hon. Friend's statement on Thursday last about river authorities, in creating area No. 9 he created a genuine South-West region for water. I hope that we can do likewise for economic planning purposes.

There is a feeling in the South-West that we do not have either the ear or the understanding of Whitehall and Bristol. People need a lead, and they are looking for one. If, therefore, there were a genuine South-West economic development council, it would serve the needs of an area which requires some form of assistance. Let us remember that the fundamental purpose of regionalism is not only to provide more economic activity and to act as a brake on centralised bureaucracy, but also to establish in our regions a genuine association between men, decision-making and local life.

6.0 p.m.

Photo of Dr Jack Cunningham Dr Jack Cunningham , Whitehaven

At the time of the debate on regionalism last February—almost a year ago—which took place on a Motion referring specifically to the Northern Region, we gained the impression that the Government were sanguine about their regional policies. Indeed, we were told that the Motion was rash and ill-conceived and had no bearing on the facts and on what would happen in the regions.

Today the Secretary of State concentrated almost wholly on statements about improving the infrastructure of the regions. Much more important and pressing in the short-term are measures to provide new employment opportunities.

Since the Government came to office we have seen, as we said in February and as we have continued to say, a weakening of their attitude towards a positive philosophy of regional development in terms of employment opportunities. For instance, there has been a weakening in I.D.C. control. This was highlighted in a Question I put to the Under-Secretary of State for Trade and Industry—the hon. Member for Harrow, Central (Mr. Anthony Grant)—about the number of jobs created in the Northern Region this year as a result of I.D.Cs. I challenged the hon. Gentleman then. I ask him now either to confirm or deny that the Government have issued two certificates to firms for development in Milton Keynes which will provide more new jobs there than they have provided in the whole of the Northern Region in the first nine months of this year. I should be happy if the hon. Gentleman could deny that. If he cannot, he is bound to admit that what we say is correct and that the Government have loosened their control on industrial development certificates in the regions.

My right hon. Friend the Member for Workington (Mr. Peart) mentioned the question of the regional employment premium. This produced a distinct advantage for development in the regions. Given the dreadful situation we face, the Government must look at this measure again.

I have made it clear to my constituents that we are now talking not about employment this winter, but about employment next winter, because the situation will, if anything, be worse. This view is confirmed by a recent survey by the National Institute of Economic and Social Research which was reviewed in last Sunday's edition of the Sunday Times Business News. The Institute is not particularly sanguine about growth in the coming years and is very unhappy about employment prospects.

The Secretary of State said today that the best thing that can happen for the regions is an upswing in the economy. That is fine, and we all want to see it happen, but it is nonsense to suggest that that alone will solve problems which have existed in the regions for up to 50 years. It is nonsense to say that after all this time we can get by without a realistic approach to the creation of new employment in the development areas.

The whole question of the Government's philosophy was highlighted in the speeches of my right hon. Friend the Member for Sunderland, North (Mr. Willey) and of the hon. Member for Middlesbrough, West (Mr. Sutcliffe). I agree with many of the remarks they made. I hope that even if the Minister will not take it from this side he will accept it from his own supporters that the situation is serious and that drastic action is called for.

The long-term measures that have been discussed today for improving the infrastructure are undoubtedly important. Nevertheless, in the last few months the Government have twice had to update their views even on those proposals and have made supplementary announcements about their programme.

The Government have been almost totally deaf to the arguments expressed from this side of the House on behalf of the regions, so much so that it might be said that Quasimodo could have been marketed as a high fidelity listening system by comparison. The Government have been deaf, not only to our arguments about employment, but also to our arguments in terms of educational development, health development and social welfare development in the regions and in terms of the number of subregions, such as the area in which my constituency lies—West Cumberland—the local economies of which are undergoing a crisis.

We have pleaded time and again with the Government. At one stage the Secretary of State for Trade and Industry promised us a thoroughgoing review of regional policy. We are entitled to ask: where is that review? On what basis were the changes made? Apparently the Government came to office determined to make changes without even conducting a review. Then they contradicted themselves and decided to have a review. We are still waiting.

The unemployment situation is very serious in my constituency, particularly in Millom and Cleator Moor in the Ennerdale rural district area. Unemployment is at an unacceptable level also in the Borough of Whitehaven itself.

Some months ago, when an existing advance factory was let in Millom, the Government decided not to go ahead with the provision of a second advance factory in that town, contrary to a promise which had been given by the Labour Government. I am pleased to say that after months of arguing the Minister changed his mind. It is sobering to think that had the Minister not taken the wrong decision in the beginning, people in Millom could now be in jobs at the second factory if it had been built and subsequently tenanted. I understand that it will not even begin building until next spring.

We were told by the Secretary of State for the Environment in the February debate that he expected total spending on regional incentives to increase this year. We know already that spending on advance factories has fallen. I await with interest the figures for the whole year on all the measures.

The philosophy that we are arguing about is one of destroying the myth which surrounds the metropolitan area of Britain and which leads people to think that the regions, where 30 per cent. of the population live, are awkward appendages to the rest of the country which must not only take second place but should be content to do so. I do not accept that concept and I hope that a future Labour Government will not accept it.

Photo of Dr Jack Cunningham Dr Jack Cunningham , Whitehaven

I hope that that indication of dissent means that the Minister does not accept the argument either.

This is what makes so important the argument which has been put from both sides this evening that the whole attitude of the Government towards the devolution of Ministries and other Government establishments must change. There is not one Government establishment of any size in the whole of Cumberland or Westmorland: not one. I would like the Minister to look at that.

Secondly, we had a statement about infrastructure this evening. Will the Minister also look at the possibility of major improvements in the West Coast road from Workington to Whitehaven and Millom and down to the Furness district in Lancashire? That, too, is critical for development in West Cumberland.

Thirdly, will he also now start looking at what is happening in terms of oil exploration in the Irish Sea? He will know that for some time there have been proposals that Whitehaven harbour ought to be developed. If that is to take place in time to meet the needs of oil exploration in the Irish Sea, the Government ought to be thinking about this now.

Finally, I am not sanguine about the employment opportunities in my own constituency or, indeed, in West Cumberland. The Government cannot dodge responsibility for the worsening situation, a situation which is certainly much worse than it was last winter when we had the last debate. I am afraid that unless I hear something to the contrary this evening I must say to the people who are constantly writing to me about employment opportunities, "This year, next year, sometime, never"—never, it seems, particularly in the case of men over 50, many of whom have been looking for jobs for months and months and months. Are we really going to say to them, "You will not again in your working lifetime get an opportunity of a job in Cumberland"? That really needs to be answered.

6.12 p.m.

Photo of Mr John Pardoe Mr John Pardoe , North Cornwall

The unemployed in the development areas, if they read this debate in their spare time, cannot but fail to feel let down and disappointed. It has, I think, from the word go been a somewhat desultory, parochial debate, largely I suspect because we did not have with us the Chancellor of the Exchequer, nor did we have the Secretary of State for Trade and Industry. It marks an extraordinarily complacent or bored attitude on the part of the Government to indulge the House in a debate on unemployment in the development areas at this time of all times without the chief organ-grinder himself, because it is the Chancellor of the Exchequer and his measures since June, 1970, which have resulted in the immense increase in unemployment in the development areas.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

I really must correct the hon. Gentleman on this. First, it is not our debate. It is a debate which the Opposition chose for this Supply Day. Secondly, it is a debate on development areas in England only. A short time ago there was a full debate on unemployment and my right hon. Friend the Chancellor took a full part in it.

Photo of Mr John Pardoe Mr John Pardoe , North Cornwall

However many debates we have had, the unemployed still remain unemployed, and there are rather more of them. I would have thought that whether it was England, Scotland or Timbuctoo unemployment in this country was worth the presence of the Chancellor of the Exchequer and the Secretary of State for Trade and Industry. The Secretary of State for the Environment is no substitute for either of those right hon. Gentlemen. Indeed, I cannot think what he is a substitute for.

The debate has been to a large extent a "whodunit" on unemployment. I do not want to indulge in too many recriminations because this is not the first Government to have got their economic forecasts wrong. Nor can we discuss unemployment in the development areas entirely separately from the national picture. All of us must realise that the first incentive to any firm to move to a development area is shortage of space or shortage of labour in the overcrowded area from which it proposes to move. It does not start to look for investment incentives or other aids until it has reached the point at which it feels the need of space or labour. It is essential, therefore, that we make some comments on the national position.

There seems to be in some parts of the House and, indeed, among some economists a feeling that there is a mystery about unemployment and about low investment. The Secretary of State for Employment is the arch proponent of this mystery. He raises his hands in despair and wonders how on earth it came about. I do not think there is any mystery. Unemployment is at its present level because successive Conservative and Labour Governments have deliberately set out to create it. There is no doubt about this; they created it through the squeeze which was introduced by the Labour Government before devaluation when they tried to stave it off, and after devaluation, and the squeeze was continued by the present Government when they came into office, until a short time ago when they conducted a complete volte-face. We have had seven years of stagnation and seven years of very high interest rates; and high interest rates are designed to keep investment down and to stop employment from growing. There is indeed a perplexity among some economists why we have this unemployment, and there are even those who ask whether Maynard Keynes was wrong.

It is perhaps erudite to question a fundamental economic truth, but Keynes knew only too well that there is a period of time which elapses between reducing taxes and increasing credit and the subsequent employment. He said this very clearly: It is not easy to revive the marginal efficiency of capital, determined, as it is, by the uncontrollable and disobedient psychology of the business world. It is the return of confidence to speak in ordinary language which is so insusceptible to control in an economy of individualistic capitalism. He showed clearly that he realised that this at least would take time.

The question now is, what should be done about it? How is unemployment to be brought down? I have already said that we cannot possibly do this in the development areas alone. We can only do it, or only begin to do it, by getting unemployment down in the country as a whole and so creating that demand for labour and space that will get the economy in the development areas going. The change which we must make is one related to exchange rates, because if the Chancellor is going back to fixed parities unemployment will be with us for ever and anon.

The right hon. Gentleman made an explicit statement about the economy on 2nd December, when he said in reply to his right hon. Friend the Member for Taunton (Mr. du Cann): I said in my statement that the discussion which we had was concerned with the conditions necessary for a return to fixed parities. It is the view of all the members of the Group of Ten that this should be the ultimate aim."—[OFFICIAL REPORT, 2nd December, 1971; Vol. 827, c. 672.] I hope it is not the view of the present Government, because if it is they are going to perpetuate low investment and unemployment. I put a question to the right hon. Gentleman on 23rd November asking whether he was aware that the floating pound was about the only sensible policy in the economic field which the Government had so far pursued and that to ditch it now would be a total disaster. He said he disagreed, and that if one discussed it with businessmen and others who took decisions one realised that the uncertainty created by the present situation was one reason for the lack of confidence which we were experiencing.

A return to fixed parities would mean one thing and one thing only to businessmen thinking of moving to development areas. They would be certain that when the Government came up against the next balance of payments crisis they would resort to a credit squeeze and tough fiscal policies and would stop expansion. That is what is holding back investment, and that is what is really creating this uncertainty. We shall get no sustained growth and no sustained business confidence unless the Chancellor makes a statement very shortly at the next Group of Ten meeting that this country will stick to a floating exchange rate, come what may.

The second thing which the Chancellor must do to increase investment immediately is to get rid of the uncertainty which exists in businessmen's minds as to whether Bank Rate has reached its lowest level. Too many people are staving off investment decisions in the belief that Bank Rate may drop another 1 per cent. or so this Thursday, next Thursday, some time, never.

I would say, with the Economist, that there is no level of Bank Rate which I would regard as too low. A 3 per cent. rate would at least convince business that it was not going any lower and would get investment going rapidly. If these two things are done nationally, there are enough tax cuts in the pipeline to get growth going.

We have a great responsibility. At last, for the first time for probably a decade, we have a chance of at least three to four years' uninterrupted 5 per cent. growth. But the Chancellor seems to be behaving like a man lost in the woods. He has finally given up going round and round and has gone to sleep; he wakes up to find himself in another part of the woods facing a signpost pointing the way to go—and he refuses to believe it.

Britain has had a lucky break, and I do not want the Government to spoil it. When that expansion gets going, the problem of the regions can be solved, but we must then question whether the existing regional incentives will ensure that the regions will get a satisfactory share of the increased growth which will undoubtedly come if these policies are adopted.

I do not want to overstate the problem of the South-West. The hon. Member for Bodmin (Mr. Hicks) has already outlined some of these problems. Since November, 1968, the number of men unemployed in the whole region—I share the hon. Member's views about the geographic and economic nonsense of a region extending from Gloucester to the Scilly Isles—has risen by 50 per cent., but the number unemployed in the development area has risen by 33 per cent.

I would not describe that figure as "only" 33 per cent., because it is a substantial rise, but at least the difference between those two figures may show some sign that the measures of regional development which have been taken over the last six or seven years are paying off to a limited extent.

But the present Government have enormously reduced the effectiveness of the incentives introduced from 1966 onwards and they cannot run away from the fact. In June, 1970, the disparity between the investment incentives in the development areas and the non-development areas in the United Kingdom was the widest in Europe; today, after the 17 months that this Government have been in power, it is the lowest disparity in Europe.

That is the magnitude of what they have done in this short period. They must have set out to do this intentionally. They have intentionally sabotaged the wherewithal that the regions were given in that short period of five years in the latter part of the Labour Government to get themselves up by their own bootstraps.

How have the Government done it? First, there was the October Budget, which replaced investment grants with less generous depreciation allowances. They followed that in July with a cut in corporation tax and a strengthening of the depreciation allowances in non-development areas from 60 per cent. to 80 per cent. Unless this disparity is widened immediately, the development areas will not get the benefit of any growth which is coming to the country as a whole.

The first requirement is that the Government must return to investment grants. It is extraordinary that a Government which came to power committed to negotiating our way into Europe should at almost the first stroke have destroyed one aspect of European regional policy which they will inevitably have to accept when we get in. They are busily preparing to launch us on the value-added tax because that is part of European policy—rightly or wrongly—but they have already dismantled the investment grants to which they will have to return when we get in. The Government did this, of course, for a purely political reason, to cut nominal public expenditure. But it is only a book transaction and it is enormously affecting the economic efficiency of the development areas.

Second, the Government must announce that they will keep the regional employment premium. The hon. Member for Bodmin suggested that it was not very important to the South-West development area. I beg to differ. It is immensely important to the manufacturing industry in the South-West. I agree with him about incentives to service industries but do not want to perpetuate a situation in which that very small percentage of the employed population which he quoted is employed in manufacturing industry. I want to extend it, and if the hon. Gentleman wants sustained employment all the year round he must also want to extend it.

A possible variation on the regional employment premium is that the Government should pay a part of the money now being given in this way to people in the development areas as an allowance for getting to work. One of the major disincentives in an area of low incomes like Cornwall is that if one subtracts from income the high cost of getting to work—because there is no public transport, it is virtually mandatory to have a car—one is left with a net return for getting out of bed and going off to a day of eight hours or more which is less than if one did not go to work at all. My suggestion would be a very effective incentive to labour in the South-West, particularly because of is rural character.

A good deal of money has been ploughed into public works, and the Government are continuing to do this. I question the effectiveness of some of this expenditure. The Government were very critical of their predecessors' waste and criticised the high cost of creating a new job. Perhaps in some cases they were right. Some of the projects which were announced in a recent package by the Chancellor were magnificently described by the Economist last week as "boondoggles". Whatever that means, it signifies my attitude to them—[Laughter] It is onomatopoeic, anyway.

I am also concerned about the Government's policy towards public works contracts for local firms. In a list of recent capital works in Cornwall, the lowest tenders amounted to £3,354,000 and they were tendered by non-local firms. The same jobs were tendered for by local firms and their total amounted to £3,673,000. So there is a difference of £319,000—in other words, less than 10 per cent.

I am advised that those jobs would have required 735 men over 18 months. The difference amounts to £5·56p. per week per man. Some of the outside firms use local labour, but even then 25 per cent. of those employed are in administration and tend to come from head office. But a large number of these firms did not use local labour at all; they brought in the labour from outside. And wherever they get their labour, the profits go outside the area.

I should like to refer to those who will remain unemployed whatever we do, particularly the older unemployed. I am thinking in particular of two cases from my constituency. The first is of a 62year-old mining engineer of many years' experience and strong physique, who was forced to return to England for family reasons. The moment anyone knows he is 62, he cannot get a job. Therefore, he is unemployed and lives on supplementary benefit. He would rather have his pension than, as he sees it, beg for supplementary benefit. I believe that he should have his pension and that we should reduce the age of retirement.

The second case is that of a manager aged 59, retired forcibly for health reasons with a small occupational pension. He will get the dole for one year and then will have to go on supplementary benefit. He has already obtained a summer job for the summer of 1972, for 16 weeks, so he will get the dole during the winter—but only for three years because, euphemistically, he has "opted" for seasonal employment for three years. He has not opted for it: he has been forced into it. In Cornwall, he has no option. There is no other kind of employment and we should ensure that people of this sort are paid the dole in the winter months.

When I look at the future, I am not over-depressed for the economy of the nation as a whole. However, we are increasingly London-oriented and even if growth comes there will still be a basic regional problem which we shall not solve unless we reverse this London orientation and bring power back to the people.

The Government must change their development area policy or these areas will not share in the prosperity which is coming. If they do not change this policy, they will be ensuring that when growth comes, the resources of labour in the development areas will be wasted because the boom will be brought to a halt by the bottlenecks for labour that will build up in the overcrowded areas.

Several Hon. Members:


Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

Order. It is helpful when hon. Members keep their speeches reasonably brief. I understand that about 14 hon. Members are still hopeful of catching my eye during this debate. If hon. Members are fairly short. I shall be able to call most of them. Mr. Proudfoot.

6.31 p.m.

Photo of Mr George Proudfoot Mr George Proudfoot , Brighouse and Spenborough

This debate is a disappointment to me because having been out of this place for six years, returning is like watching the late late movie. Nothing seems to have changed in those six years, despite our nearest approach to joining the Common Market, the prospect of which must have a considerable bearing on this debate.

The hon. Member for Cleveland (Mr. Tinn), who represents the constituency which I used to represent, talked of ironstone mining in his constituency. He need not have bothered because he has not had any during his time as the hon. Member for that constituency. All the ironstone mines were closed down when I represented it. He had six years of Socialist Administration in which to put things right.

The hon. Gentleman went on to speak about roads in Cleveland. As I listened to him I thought that he might have lifted his speech from an Adjournment debate which I had on the subject eight or nine years ago, and I wager that I had more success in getting better roads in his constituency when a Tory Administration were responsible than he achieved during six years of Socialism.

I was on television recently with two trade union leaders and I have to report that they cursed both the Conservative and Labour Parties for their efforts, or lack of them, on behalf of the regions over the years. One hon. Gentleman opposite said that both parties had tried for half a century to do something about the regions. It is time that we admitted that we have both failed to do as much as we want to achieve.

It is clear when we look at development areas throughout the world that we in Britain have not done less well, or certainly no better, than any other country in this matter. I hope that as a result of this debate the Government will look ahead further than the meagre four or five years for which Administrations in this country are elected. I have total confidence that the Conservatives will win the next election and the one after that. I therefore encourage the Government to look very much in the long term at regional problems.

May I in passing refer to you, Mr. Speaker? I recall that when you had a different rôle I sat next to you at a conference at which I said, in effect, "Let us stop using the words distressed areas'", which was the phrase then in use. "and use a more dynamic term such as 'development areas'", and I am glad to say that that has been done.

The only time that I can recall any success having been achieved in regional policy, it was brought about as a result of the Hailsham Report. The Conservative Government of that time began to implement the recommendations of that report and Labour carried on. It was as a result of those efforts that the boss word "infrastructure" entered our everyday vocabulary. A great deal was done in the North-East and anyone driving through that area will realise how much was due to the Hailsham Plan for the North-East.

I was surprised at some of the remarks of the hon. Member for Cornwall, North (Mr. Pardoe) and I got the impression that he had visited none of the old industrial areas, South Wales or the North-East. That observation leads me to welcome the fact that my right hon. Friend the Secretary of State for the Environment opened the debate because it is also an environmental problem which these old industrial areas face. It is obvious that the hon. Member for Cornwall, North, because he does not understand the need for this environmental approach, comes from a particularly pleasant part of the world.

To an extent, therefore, both sides of the House have over the years been guilty of a certain amount of political gerrymandering. As soon as the Labour Party came to office they changed the development area status concept from what it had been and greatly widened it. They spread the jam more thinly in the North-West and elsewhere. They did not do a thing about the unemployment problems of those areas and it is clear that we must now go for growth points. In other words, the Government must bring out a new and radical plan not just covering the next three or four years but a plan containing policies that are framed with an eye on Europe.

I fear that this House does not know enough about unemployment in the regions to be able to read the figures correctly. One hears all sorts of stories. On the train going home last week I heard of five men who had applied for one job in Newcastle. All refused the job at £21 a week and said in effect "The job is worth having for another £10 on the side". [Interruption.] I understand that it is a true story.

I am an employer in a minor way in a development area. I assure hon. Gentlemen opposite that although I have advertised for staff they are not easy to get. I speak from personal experience. This is why I say we must analyse the figures. I come from a seaside resort and it is clear that many people who have retired to that and similar areas are drawing the dole because they retired before the age of 65. I suggest that a service that we could perform for the development areas is to analyse the make-up of the unemployment figures relating to those areas.

I was pleased for another reason to see the Secretary of State for the Environment open the debate. In Committee upstairs we have a Bill to reform local government. In my view this Measure will help to solve the problem of regional unemployment more than anything we have done in recent years because it will identify the estuaries. I was a Member for a Teesside constituency when Greater Teesside was formed. That concept has done wonders for Teesside and I look forward to the same thing happening on Merseyside and Humberside. I sincerely hope that Whitby, a town near to where I live, will not wish to stay out of Greater Teesside. It would be a mistake if it did.

I draw the attention of my right hon. Friend to an article by a gentleman calling himself the Earl of Lauderdale—I do not know him; the only Lauderdale I know is Fort Lauderdale in Florida—in which he gives some extremely intelligent arguments in favour of the development of the estuaries—Humberside, Teesside, Harwich and Felixstowe. He suggests that work of this kind is in project behind a veil in the Ministry. I hope he is right because if we can achieve growth points along the East Coast and elsewhere and have deep water ports, we will be on the right track to curing much of the regional unemployment that now exists.

Giant steelworks must come. The same article identifies the sites of eight such major steelworks which, the writer considers, will be built in Europe by 1985. I appeal for one site to be established at Redcar but I appeal to my right hon. Friend the Secretary of State for the Environment to make it an absolutely "clean" steelworks. The only such works to be established so far anywhere in the world is Houston in Texas. It costs a lot to make a steelworks "clean"—that is, to ensure that it does not pollute the environment—but it is worth it and makes for a great deal of employment at the end of the day. I therefore plead with my right hon. Friend to make it "clean" and ensure that no harm is done to the environment.

Although the establishment of such a steelworks will provide a great many jobs, one must be frank and admit that the establishment of a giant works where I have recommended one should be established would carry with it the finish of the steelworks at Consett.

When speaking of the development of the East Coast and the estuaries the development of the roads must come at the same time. I am referring not to local roads being dollied up but to new main motorways to the ports being constructed. My own constituency of Brighouse and Spenborough would be helped by that. It would be an insurance policy for the future. The first road which must be finished is the M62. I appeal to the Government to push ahead as rapidly as possible to get the rest of the contracts out to Hull and Humberside to complete the M18 which joins the M62 and goes to Humberside, where the bridge was thrown in as a result of a by-election pledge.

We want to ensure that Humberside, which has real ramifications for the West Riding, Teesside and other parts of the East Coast, will get ahead. I also hope that we shall not forget that our standard of living is going up. Therefore alongside the motorways which will carry the heavy traffic to the ports there should also be leisure routes. I am delighted to see that the A64 will soon bypass Tadcaster, York and Malton, which is a good thing for the people of the West Riding. Access to the coast must be available, and this is the way to drive ahead.

I now turn to the Bolton Report. I was amazed at what the right hon. Member for Workington (Mr. Peart) said. He cannot have read beyond page three. There are nine categories of small firms. The right hon. Gentleman mentioned only one category. I believe that that report contains the seeds of an increase in the number of jobs in development areas. It will be seen from the report that small firms employ a larger number of people than large firms. I am delighted to see that small firms employ more women than large companies and that they are more likely to employ people over 65 than large companies. The Bolton Report is, in my opinion, a real indicator of how to help some of the development areas.

I was shocked to hear the right hon. Member for Workington say that the present Government had done nothing about the Bolton Report. He is quite wrong. He has not done his homework. I have seen the Minister with that responsibility and have made two suggestions to him. One is that small business scholarships should be set up. These would not require men to leave their businesses for up to a year, but only for days or up to two or three weeks, to attend seminars. We should have programmed learning for people in small businesses so that they can stay at their places of employment while they are learning.

I am delighted with the results of the campaign which I carried on for free depreciation. The Chancellor went a long way towards it but he went further than I asked. I asked for it until entry into the Common Market. I believe that we are on the edge of a boom. A detonator might be needed to set it off. That detonator may be a reduced Bank Rate, and I accept everything that the hon. Member for Cornwall, North said about that. I do not think, however, that the detonator could be operated until after Christmas. If it were it might bankrupt some businesses, especially if it were done on purchase tax.

For 50 years neither party has been successful in the development areas. We must get radical about this. The Government should go ahead because they have 15 years at their disposal. They will succeed.

6.43 p.m.

Photo of Mr David Reed Mr David Reed , Sedgefield

Like many hon. Members who have spoken, I am sorry that the Secretary of State for the Environment had to leave for another engagement, but I am glad to see a Minister from his Department on the Front Bench. The last time the right hon. Gentleman intervened in a debate on the regions, in which I followed him, I had occasion to compliment him on his abilities as a practitioner of public relations.

What the right hon. Gentleman was doing then was a favourite trick of this Government in their early months—totalling up a few measures over four or five years, and producing them, like a rabbit out of a hat, as something good for the regions. Perhaps the right hon. Gentleman will forgive me if I say that anyone who knows public relations will confirm that one trouble about it is that one can go on promising but eventually one has to produce the goods. That is what this Government have failed to do.

When I heard the Secretary of State's catalogue of stale news I could not believe that that was all that this Government could offer the country with a situation in which 1 million people are likely to be unemployed this winter and in which in the Northern Region the figure will approach 100,000. We can only hope that the Under-Secretary will offer us something else, because what we have been offered so far will not even scratch the surface of the problem in the North-East.

The hon. Member for Middlesbrough, West (Mr. Sutcliffe) spoke about the ways in which Governments of both parties had tried a stick and carrot policy to attract new industry to the regions. There is nothing to be gained from a discussion of the variations in such a policy. In fact, the only way to judge the effectiveness of any Government's regional policy is for help to be provided in the ways which are really needed. As far as the North-East is concerned, the help needed now is new jobs.

I do not want to sound as if I am complaining about the environmental and infrastructure improvements which this Government, quite rightly, are pushing through. These things are welcome, but what we really need is new jobs.

If one looks at the figures for the first few months of this Government's term of office, and compares these with a similar period under the previous Administration's stick and carrot system, it is easy to see which of the two parties was the more successful. If one compares January to September, 1970, with the same period this year, it will be seen that in 1970 in the Northern Region 185 industrial development certificates were granted and the estimated number of new jobs was 15,700, and over a similar period this year we find that only 80 I.D.C.s have been granted and a total estimated number of 4,179 new jobs found. What counts in the North-East is the number of new jobs, but the help which the Government are giving has brought about a three-fold deterioration since this Administration came into office.

I have heard the Government's case for this—that their measures have not yet had time to take effect, that reflation is on the way; that investment will follow, and that their inducements will start to bite and attract new industry into the regions. I have doubts, however, whether that will happen, because before the measures can take effect the Government must restore industrial confidence in their own determination to tackle regional problems which was destroyed by over-hasty measures in October last year.

Even if the Government do this, they will have to go a long way to restore the differentials between development and non-development areas which they have done their best to cut back over the last 18 months. What concerns us in regions like the North-East is that we shall never get the sort of employment we need unless there is a Government which are prepared to offer blatant economic discrimination in favour of development areas, in favour of those regions with the worst unemployment problems. I am sorry that this Government have given no indication that they take the problems of regions such as the North-East so seriously.

Whatever their position may be, and we have heard a lot about that during the debate, there are six short-term measures which the Government could take almost immediately to help with the short-term unemployment problems in the North-East. At the top of the list I take the point made by my hon. Friend the Member for Middlesbrough, West. He was right to call for urgent action on the Government's dispersal policy with their own Departments.

I have good reason to be worried about whether the promised review has been a thoroughgoing review and whether every Department has been included in it. This is why I have tabled Questions to all major Government Departments which will be appearing on the Order Paper over the next week or so asking what their contribution will be to the dispersal policy.

We want a positive decision by the Government to get as many as possible of their non-essential London-based Departments out of the city, and when we talk about out of London we do not mean to Home County locations; we are talking about development areas.

This is so important because not only would the dispersal of Government Departments help in the creation of new jobs in the right sectors, where there are few opportunities now for school leavers, but it would also be an indication to private enterprise that they were taking the regional problem seriously and doing what they could to tackle it.

Many hon. Members have mentioned the regional employment premium which the Government are due to phase out at the end of 1974. I add my plea to that of others that they should reconsider this decision seriously. The premium not only has the advantage of being an inducement for new firms to come into the regions, but it is also a great help to firms already there. If we look at the number of new jobs created in any year in any of the regions it will be seen that normally much more than half of the total comes from firms which have already got roots in the regions and are expanding. The R.E.P. could help a lot here.

There are other things that the Government could do. There is absolutely no reason why the sort of financial inducements that they offer, watered down as they may be, could not be offered to firms already in the regions. Again, they would be helping in terms of what the regions need.

Fourthly, the Government should produce, and it would be for the first time, a detailed assessment giving their own positive views on what the likely effects of entry into the E.E.C. will be on the regions. I am sure that many investment decisions have been held up as a result of firms not knowing what changes entry to the E.E.C. will mean in regional inducement policies or what changes there will be to the economic life of Britain as a whole. The Government owe it to their friends in industry to publish an authoritative review setting out the likely effect of entry to the E.E.C. upon the regions.

Fifthly, the Government should reverse their most disastrous single decision to locate the new V.A.T. headquarters at Southend. More than any other single decision, this has undermined industrial confidence in the Government's determination to put right regional problems. If when the Government have an opportunity to establish something in a development area—and I would prefer it to be the Northern Region, but any of the development areas are eligible—they do not do so but instead establish an enterprise which can provide up to 10,000 new jobs quite deliberately in an area such as Southend, then private enterprise has a right to say, "If the Government will not help the regions, why should we?"

Sixthly, the Government have been honest recently in admitting to the House that their earlier economic forecasts were wrong, that they had made mistakes—probably because of the advice they were getting—when it came to handling the economy generally. When it comes to the regions, why cannot the Government be equally honest and say, "All right, we made a mistake during the early period of our Government"? As has been shown by the number of new firms moving in and the new jobs being created, the Government's regional policy is failing and they should have the courage to come to the House and admit it.

None of these suggestions is outside the scope of the Government. They can start doing something now. If anything practical is to happen during their term of office and they are to provide the new jobs, the Government will have to show private enterprise that they have the political will to tackle regional problems. There are likely to be 100,000 people out of work in the Northern Region this winter. There is a limit to the length of time that they can go on simply living and hoping, waiting for promises to come true. The people have a right to demand some action from the Government, and I only hope that the Government will have the courage to respond to their request.

6.55 p.m.

Photo of Mr David Mudd Mr David Mudd , Falmouth and Camborne

It is interesting that tonight the House has unwittingly embarked upon a rare piece of parliamentary history for West Country Members in that of the last six speakers no less than three of us have the honour to represent Cornish constituencies. It is equally inevitable that contributions from three Cornish Members will produce no less than three different assessments of the problem confronting Cornwall and three completely different theories as to how they can best be tackled. Without commenting on the varied points made by my colleagues so far, I would hazard the suggestion that the current unemployment problem in Cornwall is as much due to a social, industrial and economic change within the county as it is attributable to a political reason.

If we look at figures between 1959 and 1969 there is growing evidence of a swing away from the extractive industries and a growth of employment in the manufacturing industries. For instance, between 1959 and 1969 there was a 30 per cent. increase in the number of jobs available in Cornish manufacturing industries. The figures rose from 15,638 to almost 20,000. Although this increase of 4,000 jobs was offset by the loss of 6,000 jobs in the extractive industries, creating a crude deficit of 2,000 jobs, the important factor is that the swing from extractive work to manufacturing work led to higher pay packets with the result that the Cornish economy became that much stronger and the county moved towards the state of economic self-sufficiency that must be the basis of its economic survival.

Although the national trend in the extractive industries is one of gradual decline, the renaissance of tin-mining in Cornwall is already having a dramatic effect, so much so that many of us can hardly believe that it is happening. In September, 1969, the total labour force employed in Cornish tin-mining stood at 1,028. Only a year later it had gone up to 1,270 and at the end of November this year it had leapt to 1,557, a 50 per cent. increase over two years. It is worth noting that the area manager of the Department of Employment is on record as having said recently that tin-mining is the only bright spot in a very depressed employment situation. Certainly the opening of one major tin mine in Cornwall in October and the probable opening of another early next year undoubtedly gives rise to a degree of optimism about employment particularly in the western half of the county.

Cornwall has had certain conspicuous successes in the attraction of industry, notably over the past 12 months, and here I take issue with the hon. Member for Cornwall, North (Mr. Pardoe). For example, at the end of 1970 there were six blueprint projects on offer to the county. Three are now in operation with additional jobs for 360 people and a fourth is now a firm proposal with an additional 300 jobs. This year alone, despite the alleged economic disincentives, another five projects have been decided for the county. They will provide more than 1,400 jobs in all, mainly in the Camborne-Redruth and Falmouth-Penryn areas. Unfortunately these new jobs, together with the expansion of employment in the mining industry, are still not sufficient to offset the growing number of redundancies in Cornish industry generally.

I wonder whether the Cornish unemployed men and women are receiving the support to which they are entitled from certain local councils and planning authorities. One local authority in the western part of the county has already become notorious for its virtual refusal even to look at improvement grant applications in excess of £2,000, with the result that much-needed work is being denied the building trade at this critical time.

The Camborne-Redruth Urban District Council is, with some justification, annoyed at the decision of the Western Area Planning Authority to give planning permission for factory space, which could provide up to 200 jobs, to be used as a wholesale food warehouse which will provide about 30 jobs.

It is against that background of attracting industrial expansion to Cornwall that we come to the glossy penny-dreadful produced by the Department of Trade and Industry and circulated today. Fingering with excitement my way past its cover, which carries a motif of creeping coral, I come to page 24 which deals with South-West England. I am a little worried about this page for two reasons. First, it contains two blatant inaccuracies. Anyone who is likely to take action on or to be interested in an official publication is likely to be a little sceptical if he finds that it contains inaccuracies. The first of these is the spelling of Camborne, which here includes a "u". Second, a caption to a photograph refers to messing about in boats off Falmouth when the photograph shows it to be no such place. It is nearer Truro than Falmouth.

On a more serious level, I believe that the document is dangerous because it implies two questions that should not be implied in a document designed to sell a region. For example, it says that two-thirds of the unemployed are in West Cornwall, which has a long industrial tradition". The incoming industrialist might justifiably ask himself why, if it has been so long a traditional area of industrial employment, it now carries a major burden of unemployment. That in itself could be a disincentive to proceed further with initial investigations.

Second, the document is perhaps dangerous in overselling the area under the heading of "Leisure". It lists the various amenities, the magnificent coastline, the holiday tradition and the sport enjoyed all the year round. The incoming industrialist might well ask "What hope have I of getting planning permission to set up in the first place, let alone expand, in this heaven beyond the Tamar?" There is a danger in this glossy over-selling. It is necessary to sell the area but not to that extent.

To conclude, I shall try to be constructive but what I have to say will be controversial and will probably be equally unpopular on both sides of the House. It seems to me that with the terrifyingly high level of unemployment that the country is now enduring, both within the development areas and beyond their boundaries, the time might well be coming when, until the level of unemployment is reduced by at least 500,000, the Government should set up a regional labour force recruited, paid for at union rates and utilised by the Government to turn the great skill, ability and determination to work of the unemployed into key public works for the benefit of the environment and the infrastructure generally. That would utilise all the skills of all the types of people who, although no fault of their own, find themselves unemployed. It would restore to them their right to work, their dignity and their hopes of further employment. It is not too difficult a task at least to be considered by the Government.

7.6 p.m.

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

Everyone is happy when a sinner repents. While the hon. Member for Falmouth and Camborne (Mr. Mudd) has not become a convert to the Labour Party and socialist concepts in making the statement he has just made, he has taken a small, haltering, faltering step in that direction. All hon. Members were very interested in his proposition, which is very much in line with what many of us have been arguing for some time, that we need increased Government intervention and a full-scale public works programme to deal with the immediate problem, particularly in the regions.

I want to speak primarily about the problems of regions, not in isolation from the overall unemployment problem but recognising that even if the Government carry through a full-scale reflationary policy there will still be areas like Merseyside, the North-East Coast, the area of which the hon. Gentleman has just spoken, South Wales and parts of Scotland with particular and peculiar problems requiring a regional policy by the Government to create conditions of full employment.

It would be an illusion to believe that merely by reflating the economy and by creating full employment in areas like Birmingham and the South-East we shall solve the problem of the regions with their deep-seated difficulties, many of them going back to the days of the deep depression of 1929 and the 1930s. Let us take my own area as an example. The North-West was the cradle of the industrial revolution. Anyone travelling through some of the Lancashire towns can see by the way the earth has been torn up, the great slag heaps and the derelict cotton mills that that was where the industrial revolution was born. It is here that we are reaping the harvest of the dragons' teeth sewn in those days, and it is here that we require full Government assistance to overcome our problems.

In my own area of Merseyside we have 53,000 workers unemployed, 7 per cent. of the working population. Nearly 11 per cent. of the males are unemployed in one of the most highly concentrated industrial conurbations in the country.

There has been a decline in the shipbuilding industry and in the traditional industries. Over the years the Labour Government and, to be fair, even the previous Tory Government did a great deal to introduce new industries into the area. There are great motor-car factories which did not exist before 1959 and other industries which are complementary to the motor-car industry. In the 10 years from 1959 to 1969, 69,000 new jobs were created on Merseyside. Yet in 1959 there were 30,000 unemployed, in 1969 there were 35,000 unemployed and today there are 53,000 unemployed. We have brought in these new industries but we have been running fast in order to stand still in the position in which we were in 1959.

The Labour Government, of course, did far more than any other Government have ever done in creating new employment in areas like Merseyside. The Government's policy on investment grants and industrial development certificates, and the doubt about what will happen to regional employment premiums, have all created uncertainty in the area and aggravated a situation which was already a difficult one. We have to learn that lesson. We have to say, frankly and honestly, that even all the efforts that were made by the Labour Government, magnificent as they were, did not solve the problems of the regions. Even a general reflation will not solve the problem of the regions. Additional action must be taken.

First, we must get back to the policy of investment grants, continue the regional employment premium and reverse the Government's policy to the policy of the Labour Government. There are some things which we must do immediately. I should like to see developed a general public works programme, along the lines suggested by the hon. Member for Falmouth and Camborne, although I do not accept everything he said, to ensure that labour-intensive work is available for the unskilled and the semiskilled who make up the great bulk of the unemployed. These are the short-term, immediate measures we should take.

There is no point in coming to the House and making a great speech about the terrors of unemployment without producing positive ideas on how to deal with the long-term problem. I suggest that there should be set up a Ministry of Regional Development which, under the next Labour Government, would become part of a new Department of Economic Affairs. To solve the long-term problem we must have active Government intervention.

We shall have to go further than that. My hon. Friend the Member for Renfrew, West (Mr. Buchan) recently made a speech in the House, with which I agree, suggesting that purchasing by local authorities, nationalised industries and the Government should be geared to the development areas. We also need to develop new publicly-owned industries. I am not arguing that we should necessarily take over existing industries. There are many Government research stations which produce excellent new ideas which sometimes hang around for years without being taken up by private enterprise. The Government should take up those ideas, develop them and use them in the publicly-owned industries. New publicly-owned industries in areas like Merseyside could be geared to help the underdeveloped countries and these two purposes could be complementary one to the other.

When the Bill to deal with the shipbuilding industry comes before the House we must be sure that the Government will not be tied by their doctrinaire policies of the last 18 months. The Government have already had to accept more intervention than they wanted to accept. I hope it will be recognised that the Government will have to help the shipbuilding industry by subsidies and financial aid, as is done already in Japan, in the Common Market countries and even in that citadel of capitalism, the United States of America. The Government must get away from laissez-faire capitalism and stop looking to the past. No modern industrialised country can hope to solve these problems without economic and political intervention by the Government.

The Labour Government did not solve this problem entirely although they made great strides towards solving it. Previous Tory Governments have not solved the problems of the regions. The present Government have for the last 18 months aggravated the problems to such an extent that there is now the disastrous possibility of there being almost 1 million unemployed by Christmas.

There is a lesson in this. Many of my hon. Friends and I have argued for Socialist policies. Some people think that Socialism has to be looked at from a distance—rather like looking at a ship through a pair of binoculars—and has no immediate relevance. Laissez-faire capitalism has not solved the problem, a mixed economy has not solved the problem. When we have a new Labour Government the regional problems will be solved in the only way in which they can be solved in the last analysis, and that is by a full-scale Socialist economic plan which will be not only an indicative but a physical plan on the basis of our Socialist convictions.

7.18 p.m.

Photo of Mr John Tilney Mr John Tilney , Liverpool Wavertree

I am pleased to follow the hon. Member for Liverpool, Walton (Mr. Hafer), especially because I missed the speech of the hon. Member for Liverpool, West Derby (Mr. Ogden) through having to attend a meeting of a Select Committee. I find myself in agreement for once with some of the things that the hon. Member for Walton said. Before he mentioned the words, I wrote down on a small sheet of paper "running fast to stand still", and that is the position in which we find ourselves on Merseyside.

I do not agree with the hon. Gentleman's views about direct labour, nor indeed with those expressed by my hon. Friend the Member for Falmouth and Camborne (Mr. Mudd) on this topic, since I believe that direct labour means making losses; but I am in favour of public works.

I was interested in what the hon. Member for Walton said about shipbuilding. There may perhaps be too many shipbuilding yards in the world today, and not a great many shipbuilding companies making money. One thing that surprises me in this country is how few, if any, of the shipbuilding yards are interested in building oil rigs for the extraction of oil from the North Sea. It is surprising that they do not appear to be interested in building rigs since in Singapore, for example, one finds a whole shipyard given over to building them.

Photo of Mr Norman Buchan Mr Norman Buchan , Renfrewshire West

On what does the hon. Gentleman base that assertion? I could tell him of a group of yards in the Upper Clyde which would be delighted to build oil rigs.

Photo of Mr John Tilney Mr John Tilney , Liverpool Wavertree

I do not know what the Upper Clyde is doing in this instance, but when I asked the Government how many oil rigs were being built they were unable to tell me. It is high time that statistics were kept on the building of oil rigs in this country.

Unless we have more public works I believe that unemployment will rise almost every year. Fewer and fewer people are able to produce more and more wealth. Once people's working hours are reduced they obviously have much more leisure, but when people have leisure they want much more money to spend. Therefore, if the amount of work is reduced one will have to pay people more. This is a major problem and it is difficult to predict how to solve it.

I was interested in what was said by the hon. Member for Walton about the regional employment premium. It may be that many companies which operate in the development areas depend to some extent on this premium for their profit. Unless profit exists, money cannot be ploughed back to pay for the modern equipment which is necessary to continue to provide employment. I am worried that unemployment may stand at a much higher figure in future than the figure which has operated in the past. Certain major undertakings should be looked at by Her Majesty's Government.

A good deal has already been done to improve communications although the South Lancashire motorway is not anywhere near completed, and the North Cheshire motorway link with the new tunnel has not been completed because we are still examining the box girder bridges. This will be a major cost to be placed upon our community and I hope we shall receive Government help.

I believe that the country should consider undertaking great public works such as the Channel Tunnel. Lancashire does not want to be on the periphery of Europe. It must have good communications, and this is why the Channel Tunnel might be good for Lancashire.

Another piece of public work on which we should decide at once is the reclamation of the Dee. I remember 20 years ago urging that action should be taken to get our plans for such a reclamation scheme. A Minister of the day, who is now dead, said "I do not think we shall ever have unemployment again." Times change. We should have had a blueprint for such a scheme many years ago. But the Government still have not made up their minds about it.

We have heard much about dereliction, and one has only to go round the South Docks at Liverpool to see a massive area of dereliction. I do not know what will happen to that area. I hope we shall get Government help to develop the area once the docks are closed and the Port of Liverpool moved further north.

I think I should mention the question of schools. I know the Government are doing a great deal for primary schools but I recently paid a visit to the Corinthian Avenue school in my constituency, a school that was built in the 1920s. There are three other such wooden schools in Liverpool. I appreciate that the Government say they are dealing with all the primary schools which were built before 1903 but there are many schools built in the last century which are better than the school in Corinthian Avenue. With so many men in the building trade out of work on Merseyside such schools should be banished from the earth and far better ones put in their place. That particular school I saw is a disgrace.

One of the problems of Merseyside is its image. I believe it is getting better but over a number of years the image has been one of strikes, although only perhaps in certain quarters. I understand that at present there is a go-slow in the docks at Garston and that those docks are making a loss of £150,000 a year. How can those docks be expected to continue if the extra Liverpool award is given to the dockers there? If the docks are closed down—I hope they will not be closed—the dockers there will find other jobs, but the 300 men in the industry who are not dockers may be out of a job for the rest of their lives. It worries me that action by a limited section of the community can affect others to their great detriment.

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

Would not the hon. Gentleman agree that one of the reasons for the increase in the number of strikes in the last 10 years is that the motor car industry was brought to that area? When that happened the average worker in the area, who had been poorly paid in his own industry, realised how low paid he was. The last great dock strike ended only when the figure was brought up to the London level. Those workers were getting £4 a week less than London workers.

Photo of Mr John Tilney Mr John Tilney , Liverpool Wavertree

There is much in what the hon. Gentleman says, but no industry can go on making a loss. I am in favour of high wages and high productivity. One sees this in Europe, and, indeed, I saw it only a fortnight ago. This is why I believe we should go into the Common Market.

I urge the Minister to do what he can to move offices from London out to the provinces. We have superb office clerical labour on Merseyside. We also have comparatively cheap office accommodation which is ready for occupation. If there is to be a bigger bureaucracy following entry into Europe, let part of that staff he situated in the North-West or in the North.

I should also like to make a plea for more training. Many young people seem to think that training is not worthwhile because it is said that some who are trained are now out of a job. However, I feel that as many young people as possible should learn a trade, but I am told that there are many vacant places in our training schools. The more the Government can do to fill those places, the better. So much for the immediate decisions that are required.

In the mid-term, cannot a decision be made on steel? Nothing would be better for Merseyside than a decision to put a new steelworks at Shotton. I know that the hon. Member for Cleveland (Mr. Tinn) wants it in his constituency. I want it in North Wales because I believe that it would produce cheap steel for the whole of Lancashire and Yorkshire.

In due course, cannot a decision be made about the reclamation of Morecambe Bay or even of the Solway Firth? This country will be needing water in increasing quantities. Oddly enough, as a Conservative I am in favour of the nationalisation of water. Although my right hon. Friend the Secretary of State has gone some way towards that end, I want to see a water grid throughout the country.

For the long term, for the next depression, when we have spent ourselves out of the present one—

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

The hon. Gentleman has just referred to Morecambe Bay and the Solway Firth. I assume that he means the barrage scheme.

Photo of Mr John Tilney Mr John Tilney , Liverpool Wavertree

Yes, I mean the multipurpose scheme for transport, for fresh water and for recreation. The Dee barrage scheme would help in the provision of amenities for my part of the world, where many people want recreational facilities.

For the long term, cannot the Government think up further blueprints for, say, a Channel bridge after the Channel tunnel is built and for what the Dutch would have done long ago on the Lancashire coast, which is to shorten the coastline for transport and to reclaim a lot of land?

I shall not comment on the Common Market, although I was there a fortnight ago and I found no fewer than 20,000 Britons working and 70,000 Turks. Once the decision is made for Britain to go in, there will be massive investment here. In the meantime I trust that the Government will go ahead to improve the country's infrastructure. I realise that we have to pay our way but we must take greater risks in the future if we are to have the solid level of employment which everyone wants.

7.32 p.m.

Photo of Mr Edward Milne Mr Edward Milne , Blyth

The hon. Member for Liverpool, Wavertree (Mr. Tilney) raised, among other interesting matters, what may possibly be two major issues. He spoke about the training of young people. Against the background of the unemployment figures that we are discussing in this debate, one of our first requests to the Government about training is that those young people who are unemployed, through the fault of Government policies and the accumulation of employment policies of the post-war period, should be given the opportunity of training in some sort of trade or calling during the period that they are unemployed. By that, I do not mean the limited number of training centre opportunities which are available; I have in mind a big extension of training centre opportunities.

Of course, it must be remembered that we have to deal not only with youngsters who are unemployed, school leavers and others, some of whom have been unemployed for two or three years. Having dealt with them by a rapid expansion of training centres, those centres should then be made available to workers in the higher age groups. I mean the over-45's and over-55's, who are in need and who in some areas are demanding re-training to adjust themselves to the new industries moving into their areas.

Those of us who have been in this House during the past decade have watched the two Front Benches grappling with these problems. We have seen figures and statistics marching and countermarching between the two Front Benches. In this debate, we are almost back to where we started. While there have been tremendous achievements in certain areas in attracting new jobs, successive Governments in the post-war period have to admit to failure, not that they did not tackle the problem of unemployment, but that they underestimated it and only began tackling it when it had become a major problem.

Reference has been made to Lord Hailsham's visit to the North-East in 1963 and the report which followed it. I do not intend to deal with much of the political in-fighting on this subject, but it is necessary to remind the Government that this is almost precisely where they came in. In 1963 a Conservative Government had been in power for 12 years. It was only then that we began to get some action. Indeed, 1963 is not without significance, because the present Prime Minister was successively Minister of Labour and President of the Board of Trade in that Administration. I remember a visit that he paid to my constituency to open a new factory. He chided me and the chairman of the local council with the efforts being made to bring new jobs to the area by saying that the area had been oversold and that very soon there would be a shortage of labour in South-East Northumberland. Some eight years later we face the same percentage unemployment figure in terms of the national average as we experienced then.

We have heard a great deal of talk from both Front Benches about the measures needed to deal with this problem. We have to go beyond the measures adopted in the post-war period. Tonight we are not pleading for work for the development areas. We are pleading that the development areas, with the undoubted skills, abilities and aptitudes that they have at their disposal, should be given an opportunity to make a contribution to the nation's well being.

The hon. Member for Wavertree spoke about losses which were being sustained in certain quarters. The greatest loss that this nation can sustain is to have more than 900,000 people unemployed and their skills not utilised to give the nation the standard of living that it needs.

Photo of Mr John Tilney Mr John Tilney , Liverpool Wavertree

Surely it should be possible to employ many of those at present unemployed and still make profits, or enable us to have the communications which produce the infrastructure that the country wants.

Photo of Mr Edward Milne Mr Edward Milne , Blyth

The hon. Gentleman must not misunderstand me. When I spoke about losses, I was not being drawn into the controversy about profits or losses. I was illustrating that the greatest single loss that we can sustain is by not using the manpower and skills available to us to give us the standard of living that we need. In almost every single constituency in the land there are schools to be built, there are hospitals to be built and expanded, and there are slum areas to be cleared. The solutions to all these problems lie in our hands. We need only skilled manpower to solve them. Instead, we neglect that skilled manpower.

My hon. Friend the Member for Liverpool, Walton (Mr. Heffer) said that when we are talking about booms and the expansion of industry we must remember that we are living in a hungry, underdeveloped world. The nations of Africa, Asia and elsewhere could be the means by which we could solve our problems as well as theirs, because aid to the developing countries can also be used as aid to the development areas of Britain. The small tractors and agricultural equipment which they need to provide foodstuffs for the hungry nations of the world could, if matched with each other, solve a great deal of the poverty, hunger and misery which now exist.

The will to carry out this policy, as I reminded the then Government eleven years ago in my maiden speech, means that the Government must turn their backs on the traditional policies which they expounded in the General Election in 1970 and have been endeavouring to put into operation since. They must realise that if we are to deal with Britain's jobless, particularly in South-East Northumberland, they must start talking about directing industry to areas where the manpower is available and seeing that industry goes into the development districts. When we talk about development we really must mean what we say and intend to carry it out.

Many people believe that if we direct industry we must direct labour as well. I am willing to take the risk. Throughout the industrial history of this country, the people I represent and people in the development areas generally have been directed anyway. Every time one of my constituents takes a single ticket to go to work elsewhere in Britain he is being directed. I do not see why labour directed in that way cannot have as an alternative the directing of industry which we so greatly need. It is not merely that factories are needed in the Northern Region, particularly in South-East Northumberland, but that the nation needs the wealth which these people can produce. They have demonstrated, by their ability to adapt themselves, that they are capable of handling any new industries which may go to the Northern Region. Indeed, a wide range of industries has already appeared.

In about ten years there has been a loss of over 30,000 mining jobs in Northumberland. We know that there are difficulties because this industry is labour intensive whereas most other industries are capital intensive and not capable of producing the jobs which the older industries created. Nevertheless, the direction of industry must have top priority in the Government's programme for the immediate future.

The attraction of new industries, which has gone on apace since the late 1950s, must be assisted. We have had reference to the Hailsham Report and its application in 1963. But that report was preceded by the courageous act of the Northumberland County Council, despite Government hostility at that time, in creating a new town at Cramlington which has attracted a considerable number of industries of national and international renown. I ask the Government to look at the existing factories and to discuss with managements and others concerned with their running how they can be expanded to attract new industry and create more jobs quickly. One of the blank spots in the Government's policy is that, while they are prepared to invest money in the attraction of new industry—we do not complain about that; in fact, we are asking them to do a great deal more—if an existing factory wishes to expand and create new jobs, difficulties are put in its way.

We are facing a new situation which must be tackled very quickly. We must deal with the direction of labour, there must be a thorough examination of the possibilities of expanding industries already operating in the areas—the quickest single way of creating new jobs—and we must deal with and encourage confidence returning to the development areas and the question of full employment being regarded as a real possibility by this or any Government which may succeed them. We have talked about full employment only when we have needed the labour force. We have done little planning to create the full employment to which both major political parties pledged themselves in the immediate post-war period.

We are really dealing with the crisis of the post-war period. We are not dealing with the Government's failure to provide jobs. We do not want a repetition of comparisons between the records of different Governments in post-war Britain which have failed to solve the problems of the development areas by giving people the full employment which they and the country need. When we have thrown aside the arguments and counter-arguments we have to get back to the basis that any Government which want to survive in future must have the slogan of full employment emblazoned on their banner.

7.41 p.m.

Photo of Mr John Nott Mr John Nott , St Ives

I will not follow the hon. Member for Blyth (Mr. Milne) by commenting immediately on his speech. I agree with much of what he said, but I will raise one or two of his remarks during my speech.

I had not intended to speak in the debate. However, all five Members for the County of Cornwall will be participating and I should not like to be the only one on this occasion who did not speak up for Cornwall.

I have not much to add to the comments made by my hon. Friends the Members for Falmouth and Camborne (Mr. Mudd) and Bodmin (Mr. Hicks) because they covered the ground very well indeed. I did not hear the remarks of the hon. Member for Cornwall, North (Mr. Pardoe); he can always be expected to be provocative and to speak up for that part of Cornwall which he represents, but sometimes his views are not quite as sound as those of my hon. Friends.

Unemployment in Cornwall and the development areas has been persistent. Indeed, we have the same problem in Cornwall and the South-West development area as has plagued Scotland and Wales for a very long time.

I agree with the hon. Member for Blyth that no Government of any party has come anywhere near to solving the problem of unemployment in the development areas. We need a radical reappraisal of the policies which all Governments have followed since the war.

I think that Cornwall should demand more parity in parliamentary time. Scotland's problems are constantly being debated in this House, and it seems to have become the practice to have innumerable debates on Wales. Yet, unemployment in the South-West development area is persistently higher than in Scotland and Wales. Unemployment in my employment areas in Cornwall is 13 per cent. and 9 per cent. respectively. In St. Ives itself unemployment represents 15 per cent. of the labour force. That situation has continued for many years, and it does not seem to Members from Cornwall, even accepting that there are only five of us and there are 35 or more Members representing Scotland, that, relative to our numbers, we get parity in parliamentary time.

Indeed, we would also like to demand parity in Government spending. I represent perhaps some of the most outlying islands in the British Isles, the Isles of Scilly. I am aware of, and watch closely, the subsidies and advantages granted to the constituency of the right hon. Member for Orkney and Shetland (Mr. Grimond). I am conscious that the Isles of Scilly and my constituency in West Cornwall do not receive in Government subsidies and in cross-subsidisation anything like the kind of help that is received in the Highlands and Islands of Scotland.

This is not purely a Government matter. It is also a matter for the public corporations. For instance, when I last looked at it, I found that B.E.A. were subsidising Scottish air services to the tune of £½ million a year, whereas in my constituency we do not even have an air service apart from a helicopter link with the Isles of Scilly. In fact, I believe that in travelling time my constituency is considerably further from this House than are the Outer Hebrides and Orkney and Shetland, simply because we do not have the communications which Scotland has in terms of direct access from London to Aberdeen, to Glasgow, to the islands of Scotland, and so on.

The hon. Member for Liverpool, Walton (Mr. Heffer) said one thing which surprised me very much. It surprised me because I agreed with it. He said—and I hope I am quoting him correctly—that it was not just a question of pumping more money into the economy. The problems of the development areas go beyond the problems of further reflation of the economy. I listened to the right hon. Member for Workington (Mr. Peart) talking about the T.U.C.'s plan for further reflation. I do not understand what the right hon. Gentleman means. When inflation is running at 8 per cent., and when prices are rising at 8 per cent., what on earth is the point of reflating? Why should anyone want to add additional inflation—which is all that reflation is—to a situation in which prices are rising at 8 per cent. and more? That seems to be a recipe not for greater real growth but merely for faster rising prices.

What we want to achieve is not a greater rise in inflation, but a greater rise in real demand, and I think that there is a constant confusion in our debates on unemployment—and I think that this is a confusion which exists in the mind of the T.U.C.—that, somehow, if value sales are increased, so are volume sales. They are two different things. It does not help the country one little bit to sell 110 instead of 100. With inflation at 10 per cent., the country is no better off. It is unit sales, and unit demand that we want, and those will not be increased by reflating the economy further. It is real growth that we are all after on whichever side of the House we sit.

The problems in Cornwall are very different from those in many of the other development areas. I should not like to generalise upon the problems of the regions, because it seems to me that there is too much generalisation about regional problems, and each development area has special problems of its own. That is why I think the principal remedy for our problems lies in the decentralisation of power from Whitehall. Whitehall, with its all-embracing power and arrogance, believes that it knows what everybody wants. I am not getting at my hon. Friend. He knows that I never ever get at him. It is a question, in the last resort, of the decentralisation of regional policy, and that is something to which I shall return.

Our problems in Cornwall derive not from the decline of our principal industry—though that may be the problem in other areas—but from the very success of it. Agriculture is the major traditional industry of the county, together with tourism and mining. Our unemployment derives from the rapid increase in productivity in agriculture, which has been far more rapid than in industry generally since the war. It is the very success of our leading industry that has displaced people from their jobs. In that respect our problems are different, and derive from different reasons, but they are no less serious for that.

I have considerable respect for the views of some of my hon. Friends. Whom can I quote? Perhaps my right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell) is the best example. I do not think that he really believes in regional policies at all. He believes—I hope that I express his views correctly—that the market will sort out the problems. The market mechanism would, indeed, sort it out, in time but there is a confusion between the public sector and the private sector. If one wants to justify a regional policy, one has to look at the costs of public sector enterprises as well as of those in the private sector.

If private industry declines, costs in the public sector—electricity supply, water supply, road and rail charges, and so on, rise because there is over-capacity in the public sector and the optimum size of both sectors is put in jeopardy. I am in favour of regional policies because, although I believe that the market mechanism will in the last resort sort the matter out, I want to cut down the time-lag, and that means some kind of Government intervention.

The hon. Member for Blyth said that we must go in for more direction of industry. I cannot agree with that, because I wonder whether a study has been made of the number of companies which have not expanded their facilities at all because they have not obtained an I.D.C. Has there ever been a study into those industries which have been told, "You cannot build another plant in Birmingham, or in the area where you wish to expand, alongside your other facilities. You have to go to Scotland, to Wales or to Cornwall"? How many industries have then said, "If we have to put a factory at the other end of the country where we shall have much less control over it, we shall not expand our facilities at all"? My guess is that there are many companies in just that situation.

When we talk about I.D.C.s and the direction of industry, in the last resort we have to think of the efficiency of the economy as a whole, and it cannot be for the Government to know whether an industry in the private sector will be more efficient or less efficient by putting up a factory 400 miles from where the people who are running the business want it to be. We must look to the efficiency of the economy as a whole and not go overboard on the question of regional unemployment and say that, because there is high and unacceptable unemployment in the regions, that is a reason for diminishing the industrial efficiency of companies generally by sending them to places to which they do not wish to go.

Photo of Mr Edward Leadbitter Mr Edward Leadbitter , Hartlepools, The

When did the market mechanism solve the problem? Many of us believe that it created the problem in the development areas?

Photo of Mr John Nott Mr John Nott , St Ives

I have already explained that I believe that the Government should have regional policies. I want to go on and explain where I think the Government should act. I do not disagree with the proposition that the market mechanism has not solved the problem. I said earlier that the market mechanism by itself is not sufficient.

Photo of Mr Gordon Bagier Mr Gordon Bagier , Sunderland South

Is the hon. Gentleman arguing that the I.D.C. system should be abolished, or does he agree that I.D.C.s can be effective only in an atmosphere of growth when business wants to grow and does not say, "We will not grow, because an I.D.C. is refused"?

Photo of Mr John Nott Mr John Nott , St Ives

I.D.C.s will be more effective in an atmosphere of growth. I am not in favour of abolishing the I.D.C. system altogether, but I do not want a tighter I.D.C. system than what we have at present, because that would lead to a great deal of additional inefficiency in industry. I can think of factories which would never have expanded had they not been allowed to build an addition to their plant alongside their existing facilities.

There would be no problem if the United Kingdom did not have an economic and monetary union. If we had floating currencies, if Scotland had its own currency, if Wales had its own currency, if Cornwall had the Cornish penny or whatever it might be, and if all those currencies floated against one another, there would be no regional problem, because it would have a self-adjusting mechanism. However, we have an economic and monetary union and, therefore, the only way in which we can help these areas is by subsidies.

In the last resort I do not think that subsidies—I use the word "subsidies" in a global sense meaning all the incentives, cash grants and investment incentives—are solving the problem, because what the subsidy is effectively doing is propping up industries which otherwise might well have declined faster and given place faster to a new and more modern industry.

The problems of the regions are not improved by the system of subsidies from central Government. In the long run the problems are aggravated by subsidies, although subsidies are something for which all governments go simply because they are concerned with the immediate short-term problems of unemployment. But short-run remedies are detrimental often to long-term needs. If there had been no subsidies in Scotland, an area which I do not know, I should not be surprised if new industries would not have set themselves up there rather quicker than they have. However, no one can know the answer to that.

I believe that the solution to regional problems lies basically in politics, not in economics. I say again that the major problem lies in a lack of decentralisation of power. I speak for Cornwall when I say that if Cornwall had been given half the amount of money that the central Government have poured into it over the years since it became a development area we would have been much better off than we are today. We should have had a proper road down to Cornwall and proper communications 10 years ago if we had had half the amount of money which has been spent on us by the central Government. We have always known that that is what is wanted.

We had to wait for this Government to come to power before any Government promoted the programme for a proper dual carriageway right down to the end of Cornwall. Far 25 years we have been saying that this is necessary, but we have had to wait until now to get it into the Government programme.

Photo of Mr Gordon Bagier Mr Gordon Bagier , Sunderland South

The hon. Gentleman is living in a fool's paradise. The North-East has the finest road system in Britain but still has very high unemployment.

Photo of Mr John Nott Mr John Nott , St Ives

I said that I thought that all the regions were different. I am referring specifically to my own county, which I know better than the hon. Gentleman does. I am sure that the hon. Gentleman's comment is accurate, but I am not referring to the North-East. If we had been given the money and been told to get on with it all those years ago, I am sure that our priorities would have been better than those of Whitehall, because we know better than Whitehall what we want: we live there and we know our problems.

We would have spent the money, second, on building a conference centre. If we built a conference centre, we could extend the tourist season in my area and fill the hotels and boarding houses for an extra month. However, we cannot get a conference centre. We are not even allowed to have loan sanction to borrow the money for the local authorities to build a conference centre. There is no way to get the money, not even by borrowing it, because there is no mechanism which allows local areas to pursue their own schemes, even if they borrow the money.

Therefore, I ask first for greater decentralisation in regional decision-making.

Again speaking only of my own part of the world—Cornwall—the only mechanism which came close to what was required was the proposal made by my right hon. Friend the Prime Minister in 1962, when he was Secretary of State for Industry, Trade and Regional Development and President of the Board of Trade, to form what he described as a Committee of Six in the South-West. The Six were to be representatives of the area who would make recommendations to the Government about what the South-West wanted in terms of development. Then the Labour Government came in and set up the framework of regional economic development councils.

I do not have much knowledge about the regional economic development councils in other parts of the country, but I can certainly talk about the South-West one. The permanent officials of that one are very worthy and knowledgeable men, but they have no power. They work to Whitehall. The South-West Regional Economic Development Council is situated in Bristol. Bristol is further from where the real problems are in the South-West than it is from Dover. Penzance, which I represent and where my centre is, is further from Bristol than Dover is. However, the development council is situated at Bristol and it has not been the slightest good to us because it is a powerless creature of Whitehall. [Interruption.]

The hon. Member for The Hartlepools (Mr. Leadbitter) looks as if he is getting a little bored with my speech. He is not the man to look like that, because on many occasions over many years I have heard him speak at inordinately greater length than I have spoken. I shall therefore continue for a few more minutes. We know in which direction the hon. Gentleman's talents lie in the House. I have sat and listened to him and learned certain parliamentary tactics from him. I cannot say that I am very adept at the hon. Gentleman's parliamentary skills, but I have watched them not with admiration but with astonishment on more than one occasion.

My last point on solutions is that there must be a senior Minister to co-ordinate this matter. I should be delighted if my hon. Friend the Under-Secretary of State for Trade and Industry were put into the Cabinet tomorrow and told to get on with the job. However, the debate was opened by my right hon. Friend the Secretary of State for the Environment. Then there is the Secretary of State for Employment. Then there is the Secretary of State for Trade and Industry. The whole structure is a complete shambles. There is no one to co-ordinate it. There must be a senior Minister to co-ordinate the Departments and to put some real flair, purpose and direction into this matter.

Lastly, where the Government have power to help they have not exercised it. I refer not only to this Government but to all Governments of all parties. What the Government have done is this: they have poured money into giving incentives, cash grants, to the subsidiaries of American corporations and to capital-intensive industries to set up their plants in Scotland and Wales. I suppose this policy has brought some employment to these areas, but there has been a huge pouring out of money. Each job costs £2,500 or more to create. Where the Government have power, as hon. Gentlemen have said, is to move one of their own offices to another area. To a very large extent the unemployment in my constituency is among people 40 to 50 years old, and they could be helped if only the Government would move one of their thousands of offices to my constituency.

Photo of Mr John Nott Mr John Nott , St Ives

Not, I think, the Cabinet. I do not necessarily want that, because I think the Cabinet is too large already. What we want is an office to mop up some of the unemployment in my area where we have many clerical people, who are trained. This is where the Government have power to do something. We have been asking successive Governments for twenty years. As someone has pointed out already, the V.A.T. office goes to Southend. That really is not satisfactory. There may be good reasons why the V.A.T. office should go to Southend, but we want the Government to disperse their offices to places of high unemployment and where there are clerical people who could be employed. No doubt there were very good arguments for sending the V.A.T. office to Southend.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

Perhaps my hon. Friend would allow me to intervene on this point just in case it should be overlooked in the wind-up. My hon. Friend should be aware that only part of the V.A.T. office is going to Southend, probably not more than one-fifth, not more than 25 per cent., just the headquarters. There will be many substantial parts of the office besides.

Photo of Mr John Nott Mr John Nott , St Ives

I was only making a general point about the dispersement of Government offices. I do not know the facts about that particular office. The point I am making is that an office of 1,000 people would completely wipe out the unemployment problem in my constituency, a problem which has been there for the last twenty years—and this is where the Government have the power to do something; but yet nothing has happened in twenty years.

Then, in the far South-West we are a marvellous area for a teacher training college. We have all the leisure and sporting facilities, the boarding houses, and there is an enormous amount of winter accommodation in the area. Yet we cannot get a teacher training college down there. It goes to Plymouth, which is 60 miles away. We have a marvellous technical college in the constituency of my hon. Friend the Member for Falmouth and Camborne, the Cornwall Technical College. If we could get that up-graded to a polytechnic—or the University of Cornwall, which is what we would really like—that would be of great help, and it would not cost the Government very much more money immediately, and we could fill up all those boarding houses and guest houses in their off-peak season. The Government should turn our area into an educational area: there are great opportunities, and it would not cost very much at all.

Then, when are the Government going to pay mobility grants? If a chap uproots himself to move to another area—to Birmingham, for example—to work there, there is great social cost. If a man is really prepared to leave his area, Scotland or Wales or Cornwall, and move to Birmingham to get a job—where there may be work available for his particular skill, of course—why not give him a mobility grant? Why not give him £10 to help him move, or £20? We have redundancy pay. If people are prepared to help to solve unemployment problems by moving elsewhere temporarily to work, let us give them financial assistance.

I do not want Cornwall to change its character, but it has a really serious and continuing employment problem. I appeal to the Government to look carefully at my several points: first, loan sanctions for our own developments; second, decentralisation of control to local men; third, a senior Government Minister to co-ordinate all the Government Departments which have responsibility in these matters; fourth, new educational facilities which we could offer to the country as a whole; fifth, a dispersal of Government offices to the region; and, sixth, a new road, quick. In this way we would, at last, be on the move, and it would cost very little extra money beyond what is already committed to our cause.

8.15 p.m.

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

The hon. Member for St. Ives (Mr. Nott) has broken what up to the time of his speech had been a continuing self-denying ordinance among back benchers to contribute only essential points in about 10 minutes each. I think the good will which I normally have towards the hon. Gentleman evaporated when he exceeded his 10 minutes. I do not want to take up many of his points, but I must refer to one. After all, this is a debate and we are supposed to refer to one another's speeches.

The hon. Gentleman interested me when he said that he felt that the problem in Wales and perhaps Scotland had got a bit too much attention in this House. I would not agree with that, but I would say that Lancashire Members at any rate should now be demanding a greater share of the attention of this House in order to spotlight some of the problems of Lancashire. I am conscious that a lot of my colleagues on the back benches have, like me, been here all the afternoon and want to take part. I shall be brief, but I want to spend a few minutes on Lancashire's problems.

We are sorry that the Secretary of State is not in his place—we understand the reason—but today he mentioned amongst other things that £160 million had been poured into what I would call the urban renewal programme. Perhaps the Under-Secretary who replies will help me, because I want to know how much of that sum will be spent in the greater Wigan area. The hon. Gentleman will know, having received a deputation from Wigan, the concern which is felt in the greater Wigan area about the discrimination which exists against areas such as Wigan which do not receive any Government help in their unemployment problems and which are further discriminated against in that the key to getting aid for an urban renewal programme is the unemployment problem. Wigan is therefore discriminated against on two counts: it does not get money to help with urban renewal and it does not get money to help solve the unemployment problem.

I know from the answer to a Parliamentary Question which I put down that there are 85 areas in the country which have a lesser unemployment problem than has Wigan and which receive aid to overcome their unemployment problems. We have the problem of total and industrial dereliction in the North-West. My hon. Friend the Member for Liverpool, Walton (Mr. Heffer) said that if one walked or drove through Lancashire one would visit places which were in the van of the industrial revolution, and we bear some of the scars of that. The Labour Government were at fault to some extent, but it is the present Government who say that they will give aid to tackle the problem of unemployment but not give further assistance to non-development areas to tackle social and industrial dereliction.

That was a point which was made very forcefully to the Prime Minister when he met the North-West Industrial Development Association in Manchester on 29th October. I think that the Town Clerk of Wigan, if he has done nothing else, qualifies for entry into the Guinness Book of Records because at that meeting he rendered the Prime Minister speechless for the first time ever. The Prime Minister was a bit petulant at first because there had been a leak about the agenda but when he had simmered down, when he had had a cup of tea, when he found that he was amongst people only wanting to help him to get his priorities right, he became a bit more benevolent and Mr. Craik, the Town Clerk, very forcefully put to him the question about discrimination against the Wigan area. The Prime Minister, after a few moments' pause for thought, said Mr. Craik had produced some very valid arguments. The Prime Minister was not stuck for words at most of that meeting and was even giving replies to people before they had asked him questions. On this one, however, he was stumped. I ask the Minister to be fair on this. If an area has specific problems, like urban renewal, on top of unemployment it is unfair to withhold the high assistance because that assistance is linked to unemployment, especially when people in Wigan know that 85 other areas have less unemployment than they.

I return to the problems of Skelmersdale new town in my constituency. It is about the fourth time that I have raised the problems of "Skem" in the last two months, but I make no apology for that because we are in a very serious situation. We have a higher unemployment rate than the area from which people came to get away from the problem of unemployment.

I have outlined sensible measures to help. One has been mentioned tonight. A number of Tory Members have come round to the view that if the Government mean to help the development areas, a proper Government dispersal policy will have to be implemented. I have outlined how this should be done for Skelmersdale.

If we had an office block for 2,000 or 3,000 people many workers would be attracted and there would be sufficient capacity to take up the slack of the many unemployed boys and girls who, after leaving our marvellously equipped secondary modern schools, cannot use their skills. It is a poor start to have their bright hopes dashed. The Government could do something here. They could also get cracking on the hospital building programme. We have been told that Skem is the best buy for a new hospital site.

The Government could also help those firms in the new town which are dithering about expansion. One or two firms which are as well established as firms can be in a new town after five or six years, have cut back on their expansion programmes. If they really mean business, the Government should ask what help they need to expand. Their expansion would obviously create more prosperity. If the Government did this with all the firms which are wondering what to do, it would be a move in the right direction.

I repeat that the Government must make up their minds about the regional employment premium. It is vital to announce that it will continue for a good period of years. They should also consider establishing a Government training centre in the new town, which has the capacity to fill it. We have the highest unemployment rate, I think, in the North-West.

These things—a Government training centre, a big new office block, a hospital and R.E.P.—along with the abolition of the barmy plan to abolish allowances for grants, which we know the Government will have to reverse when we enter the Common Market, would much improve the prospects for Skelmersdale new town, which I am proud to represent.

8.25 p.m.

Photo of Miss Irene Ward Miss Irene Ward , Tynemouth

This has been an interesting debate because it has got down to many constituency points on which all who are concerned about unemployment are anxious for information. I assume that we are dealing with a short-term policy. I agree with my Government that there will be a major break-through not only in Britain but also, once we take the plunge and enter, in Europe.

I should like to deal with some of the short-term policies which could help deal with the rising unemployment. First, I congratulate the Secretary of State for the Environment, who is a very quick-acting Minister with an open mind. He never misses a trick. [Laughter.] It is very important to have a Minister who can delegate. This leaves him free. I have never found any difficulty in getting a quick answer to any problem from my right hon. Friend. This is very important in our present situation.

The hon. Member for Ince (Mr. McGuire) mentioned the hospitals which are forecast, and said that they are vital in many areas. I asked the Secretary of State for the Social Services about this. He immediately told me that the Newcastle Regional Hospital Board had been told that it could have £8 million if it dealt with hospitals which were on the road, with finance already arranged. I thought that the hon. Member would have found out from his own hospital board what money it has been allocated.

I hope that I shall not tread on anyone's corns when I say that everyone talks about the unemployment created over the last few years, but I recall when I was first elected in 1931 the rate of unemployment which resulted in the defeat of the Labour Government and the creation of Mr. Ramsay MacDonald's Government. I know something about history—

Photo of Mr Thomas Urwin Mr Thomas Urwin , Houghton-le-Spring

Talk about today when we have one million unemployed.

Photo of Miss Irene Ward Miss Irene Ward , Tynemouth

The policy of the Labour Party, supported by the Liberal Party, created unemployment when they were first in power in 1931. In a part of my then constituency of Wallsend 84 per cent. of the employable population were unemployed. I have spent nearly all my political life trying to remedy matters. [Interruption.] There is no need for hon. Gentlemen opposite to be rude. They sit on those benches without having any real knowledge of what caused unemployment years ago. It may be important to have that knowledge if we are to cure it now.

My right hon. Friend the Secretary of State for Employment recently spoke of the need to arrange proper industrial training courses, particularly for older men, to ensure that when employment begins to grow there will be skilled men available to take up the skilled jobs.

I was heartened last week when I met an instructor at an industrial training centre in the North of England. He was teaching a skill which would enable the trainees to gain employment at the end of the course. The men being trained were between 20 and 30, but presumably he could have trained older men. I was told that within a week of the training of an earlier batch of trainees having been completed, they had all secured jobs.

That gave me a great deal of pleasure. As the Secretary of State pointed out, it is essential that everyone is skilled in up-to-date industrial practices. It proves that if men can be trained in skills that are necessary and needed, they are more likely to be absorbed into good reliable industrial work. This applies to men who have lost their jobs because the type of employment which they occupied has died or because they did not have a chance of attaining a skill earlier in their lives. I am sure that the Secretary of State for the Environment will be pleased with this news because, in addition to giving me pleasure, it is bound to help the work which the Government are undertaking.

Much has been said about the regional employment premium. There have been occasions when I have gone against the line taken by my party, and on those occasions I have let my hon. Friends know that I am in conflict with them. When I was fighting the last General Election it was made clear to me that the question of R.E.P. was causing anxiety to industrialists on Tyneside. I therefore spoke out against the phasing out of R.E.P. before adequate employment in the area had been attained, and I urge the Government to reconsider their policy in the matter.

It is a feature of important debates of this kind that Ministers are never able to say "Yes" or "No" to a straightforward question. We spend far too much time looking at figures. I prefer to have is dotted and is crossed, and I would like an unequivocal answer to my question about R.E.P. Do the Government intend to take some action on this subject? I would expect the Government to reconsider the matter, especially if the short-term problem has not been solved. I am therefore glad that I reserved my position on the phasing out of R.E.P. at the last election.

The shipowners, who have done very well indeed with exports and have helped the balance of payments, have made certain proposals which I am not be able to explain to the House. But I am close to the Chamber of Shipping and have noted the kind of things they have in mind. My hon. Friend the Member for Dorset, South (Mr. Evelyn King), who is Chairman of the Tory Party Committee on Shipbuilding and Shipping, has written to the Secretary of State for Trade and Industry, and I hope that the wise remarks contained in his letter, and the way in which the case has been presented by the Chamber of Shipping, will secure the full support of the Secretary of State.

While I feel that the Secretary of State for the Environment proceeds at a fair pace, I sometimes feel that with the passage of the years we might welcome a little more speed on the part of other Departments. I hope that the Chamber of Shipping will get its way. I advocate its case because in the North-East shipping and shipbuilding are totally important.

The North-East Development Council's Report has been in the hands of the Prime Minister for some time now. Even before that report was presented to him by the officials of the Council, the Prime Minister was kind enough to see the Council. The Council made a number of recommendations, and I understand that these were sent to various Government Departments for consideration. Although I do not know whether we yet need a Minister for co-ordination, it is certainly time that we had some results here.

Every hon. Member has made a realistic approach to the problem. Some feel that firms should get the same incentives as they got when they first went into an area. I find political life extremely annoying when hon. Members on both sides of the House are so busy protecting their own positions that they lose their capacity to say "yes" or "no". This issue has been raised repeatedly, and there must be some Government point of view. If there is not, it means that the Government have not paid any attention to all the speeches and questions made by all hon. Members. It is time that we had a proper answer so that we know where we are.

I was pleased when the Secretary of State for the Environment made a special grant available to deal with coast protection in my area. This is a very necessary project because when the seas wash against the cliffs there can be some nasty falls, and there are some important buildings on the coastline. My right hon. Friend made this money available rapidly, and there is obviously a good understanding between him and the Chancellor.

My right hon. Friend has a large sum of money available for bringing forward important projects, and I am hoping that a school for mentally handicapped children can be expedited in this way, through the help of my right hon. Friend the Secretary of State for Education and Science.

I have tried to find out how many authorities have taken advantage of this fund of money, but the Secretary of State for the Environment, unusually for him, sought refuge in the usual Civil Service reply about the amount of money needed to collect the information. I would like to know how many local authorities in Northumberland and Durham have put forward realistic plans for improvement projects, for housing and such things. We are accelerating a central library programme in Tynemouth. A great many projects could be brought forward to help ease the terrible unemployment situation. I am grateful to my Government for all the care and attention they have taken and the help they are prepared to give.

The North-East Coast did not have any opportunities to develop during the war, because the powers-that-were then decided that we would be the first part of our island to be heavily bombed. Therefore, we were not allowed to have any new industries or make any provision for them. This set us back considerably in providing a good, well-balanced, well-looked-after environment.

I wish my Government every success in tackling the very difficult human problem of unemployment. There are signs of brightness. In my part of the world, although people are often tough in arguing with me, I hear of many bright glimpses of the future.

The Labour Government tried to do much, but they could not make the money required; they were not a very good financial, administrative Government. A Government can have all sorts of plans but they must be able to provide the cash. One of the great strengths of the present Government is that we have provided the cash—

Photo of Miss Irene Ward Miss Irene Ward , Tynemouth

I will not enter into a discussion on the question of school milk tonight, but if anyone asked me I could do a great deal better than the Labour Government did in looking after the children. We have done much better in housing and in every direction. It is no good asking me about milk tonight, but I will tackle that question some other day.

I am saying "Thank you very much" to my Government for the efforts they are making. In the north of England we have men and women who, even though they may hate my guts politically, are very fair if one plays straight with them. They acknowledge that we have a straight, active and very sound Administration in the present Conservative Government. I wish my Government well, and hone that the unemployment figures will be reduced by leaps and bounds.

8.48 p.m.

Photo of Mr Robert Brown Mr Robert Brown , Newcastle upon Tyne West

I am grateful that the hon. Member for Tynemouth (Dame Irene Ward) did not decide to discuss school meals and milk tonight. I was afraid that she might.

The hon. Lady will not expect me to deal in detail with everything she said, but I should like to refer to what she said about the report of the N.E.D.C. to the Prime Minister. I join her in saying that the time is long overdue for the N.E.D.C. to have specific proposals from Government Departments on its constructive and valuable report, which it spent a great deal of time explaining in detail.

The hon. Lady asked what plans the local authorities have submitted for the distribution of the £130 million for the public works programme which the Secretary of State for the Environment announced in July. I asked him exactly the same Question a week before the Summer Recess, when he said that he would look into the matter and let me know. Now that we are nearly in the Christmas Recess I am still awaiting his reply.

Photo of Miss Irene Ward Miss Irene Ward , Tynemouth

I have got mine. It was very good.

Photo of Mr Robert Brown Mr Robert Brown , Newcastle upon Tyne West

I hoped that the hon. Lady's words might produce better results than my Question in the summer.

I wish specifically to deal with the Northern Region. I deliberately do not wish to make naked political points. Although the question of 1 million unemployed is a political issue, I do not want to drag it down to scoring cheap political points. Neither the 80,000 odd who are now unemployed in the North of England, nor the 100,000 who will be unemployed before the spring, would thank me or my hon. Friends for reducing their plight to a political farce.

I commend, as did my right hon. Friend the Member for Workington (Mr. Peart), the Editor of The Journal of Newcastle, for the survey on unemployment which appeared on 18th November. I shall refer to it later, and I am sorry that there is not sufficient time to deal with it as fully as it deserves.

In referring to what was said by the hon. Member for Liverpool, Wavertree (Mr. Tilney) about financial losses in industry, my hon. Friend the Member for Blyth (Mr. Milne) suggested that the greatest single loss in having 1 million unemployed was the loss to the nation of their productive efforts. I think the greatest single loss is the loss of human dignity involved.

In the Northern Region in mid-November unemployment stood at 84,785, an increase on the month of 3,389, just over 4 per cent. That means 6·4 per cent. of the overall population are out of work, and 8·4 per cent. of the male population. Every day in the Northern Region 100 jobs are lost, and this has been happening for some months. The result of the Government's policies will be that there will be a net annual loss of jobs of 30,000 plus every year, compared with a balance on the right side, albeit a small one, of about 5,000 per year in the six years of Labour Government.

In unemployment benefits alone the State must now be paying out in the Northern Region at least £1½ million per week, simply to keep men unemployed. What a disgraceful waste of national resources!

As the survey in The Journal said, we are throwing away £150 million a year. This is the cost to the North of 80,000 plus unemployed. With £150 million a year, we could build three Texaco supertankers for £24 million, 12 comprehensive schools and 60 nursery schools for £12 million, five hospitals for £50 million, 40 primary schools for £4 million and 20 miles of motorway for £20 million. In spite of what my hon. Friend the Member for Sunderland, South (Mr. Bagier) said about there being a first-class road system in the North-East we could still do with an extra 20 miles of motorway. We could also build 8,000 houses for £40 million. That makes up the total of £150 million that we are now throwing away in the North-East. When one considers the unemployment problem, one must realise what a waste this is of national resources.

This very informed survey of unemployment in the North-East goes on dismally to say The North will have to brace itself to face high unemployment for at least another 18 months, and possibly longer. This grim forecast is accepted by Government departments, industry and the North-East Development Council.Since November last year 24,593 redundancies have been notified to the Department of Employment locally—an increase of 11,400 over the previous year. It goes on to evaluate three reasons why the forecasts are so gloomy in the North. It is claimed that regional policy has received such a setback during the last 15 months that the region will be in no position to take quick advantage of any turn-about in the country's economic position.There are three main reasons for this

  1. 1. The cornerstone of industry in the North is heavy engineering. The region is short of light consumer industries. But it is the latter type that will benefit first from any new boom. It will take much longer for the effects to filter through the heavy industries.
  2. 2. Many firms have used the present tight period to rationalise their staffs completely, so that if and when a boom comes they will not necessarily recruit as many as they have laid off."
This is all too true. The article goes on to say: 3. Because of prolonged stagnation, it is referring to the past 17 months of Government— industrialists have lost interest in expansion and the number interested in moving to the North has slumped The present policies of the discredited bunch opposite must be brought into question, and it cannot be denied that the replacement of investment grants by tax allowances has had a catastrophic effect on the economy. I want to quote figures to show how catastrophic this effect has been in the North-East Region. In 1969, 282 I.D.C.s approved for the North gave us 17,220 new jobs; in 1970, 246 I.D.C.s gave us 18,223 new jobs. Yet in the first ten months of this year we have had only 100 I.D.C.s producing 4,983 new jobs. It is no use hon. Gentlemen opposite wriggling about this figure of 100 in the first ten months of this year. This is the product of their handiwork, and they cannot deny it. I could go on at length, but I know that the Front Benches want to wind up the debate.

I confine myself to asking some questions. I know that in a debate of this type Government Ministers always say that, because civil servants have worked for days on their speeches, it is not reasonable to expect answers to questions. But if none of the answers to my questions happens to be in the departmental brief this evening, I give notice that I shall table these questions for answer at some future date.

My first question is this: will the Government now admit their error and reintroduce investment grants? Will they not concede that, for ideological reasons, they have been absolutely wrong in scrapping the investment grant principle immediately they came to office before they even had the opportunity to consult their advisers?

Second, will the Government drop what I call, in terms of the unemployment situation in the regions, their criminal suggestion that regional employment premium should be abolished in 1974? Does not the Treasury Bench understand that the abolition of R.E.P. will impose an increase in excess of 5 per cent. on labour costs in the region? Does it not realise that this can only worsen an already bad situation?

Third, though I do not expect an immediate answer, have the Government given any consideration to relieving the situation—I mean in the nation as a whole with a million unemployed—by reducing the retirement age and shortening the working week in industry? One cannot help feeling that in the long term we shall not remove this hard core of unemployment without a reappraisal of our working lives.

Fourth, will the Government give an immediate "go ahead" for capital development projects in the nationalised industries and call upon the industries to place their orders in the development areas? This Government have not been shy about quoting the principle that if we pay the piper we have a right to call the tune. It would not be unreasonable for the Government to insist that manufacturers of goods or services in the development areas should be competitive.

Fifth, will the Government now give the "go ahead" for massive public works spending in the development areas with 100 per cent. grants? It is no good giving the local authorities the right to go deeper into debt by the Secretary of State for the Environment saying that he is prepared to give them loan sanction.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

Can the hon. Gentleman quote one 100 per cent. grant that the last Government gave at any time?

Photo of Gerald Kaufman Gerald Kaufman , Manchester Ardwick

Can the Secretary of State quote a million unemployed?

Photo of Mr Robert Brown Mr Robert Brown , Newcastle upon Tyne West

My hon. Friend has anticipated my reply. When we were in office there was never a time that we had a million unemployed. I remind the Secretary of State that the last Administration gave direct grants in tackling the winter works programme. We did not make a percentage grant. The Secretary of State for Education and Science, for example, is at present exhorting education authorities to get on with their minor capital works programmes, knowing full well that the costs will come 100 per cent. from the ratepayers. That is sheer hypocrisy, and the right hon. Gentleman knows it.

Sixth, will the Government give immediate consideration to increasing the 35 per cent. building grant to existing firms in development areas to encourage them to expand? The principal of a firm in Newburn in my constituency came to see me on Saturday. He wants to provide 50 more jobs by erecting a giant transport complex. He has been turned down by the Department of Trade and Industry. Fifty jobs may not sound very much to hon. Members representing constituencies in the South-East or in the West Midlands, but fifty jobs in my constituency is a considerable target at which to aim.

Seventh, will the Government increase the operational grant to firms coming to special development areas and also give it to existing firms, again to encourage expansion?

Eighth, as the hon. Member for Middlesbrough, West (Mr. Sutcliffe) asked, will the Government move out of London some of the countless thousands of Civil Service jobs which could be done equally well in the development areas? My hon. Friend the Member for Sunderland, South made a quip in an intervention during the speech of the hon. Member for St. Ives (Mr. Nott) when he suggested that the Cabinet Office might be sent to St. Ives. But that is not so funny. The greatest thing that could happen to the north of England would be the building of a new parliamentary city in the North, and moving Parliament and the whole institution lock, stock and barrel to the North.

9.5 p.m.

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

This is the first major debate that we have had on the development areas since the General Election. While it is true that the House has debated unemployment on several occasions, we have not concentrated to any great extent on the economic components of regional development and on the effectiveness of the measures which the Government have taken or failed to take since coming to office.

A debate of this kind must inevitably to some extent be concerned about incentives and statistics—hon. Members have quoted statistics—but we must never forget the human tragedies behind the statistics: communities in danger of decay and the misery inflicted on workers and their families.

It is worth reminding the House what has happened over the last 18 months. I have said before—it is worth repeating, especially as we have two Secretaries of State sitting on the Treasury Bench—that the Government came to power in June last year pledged, in the words of the Tory manifesto, to initiate a thorough-going study of development area policy. There has been no thorough-going study of development area policy and the two right hon. Gentlemen know this.

Photo of Miss Irene Ward Miss Irene Ward , Tynemouth

How does the hon. Gentleman know?

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

I hope to prove it to the hon. Lady in a few moments. Certainly my researches do not show that there has been any thorough-going study. As many of my hon. Friends have said, there has been only the initial doctrinaire decision to end investment grants and the decision on the same day, 27th October, 1970, as it were, to announce the death or abolition of the regional employment premium in 1974.

Certainly we have had some panic measures—perhaps this is what the hon. Member for Tynemouth (Dame Irene Ward) mentioned earlier—which by and large were scratched together in response to censure Motions tabled by the Opposition. It is no wonder that The Times, in an editorial on regional policy last Thursday, said: the striking feature of the list of measures is the piecemeal nature of the strategy, adding something here, chopping something there, and extending expenditure there. The industrialist who has followed all the changes and worked out his sums to establish the balance of advantages must be a very able man indeed. I agree with that completely.

The Government came to power promising a review, but in the last 18 months they have created an unprecedented degree of collusion. Certainly The Times of last Thursday agreed with that. To begin with, when the Government came to office it seemed as though we were to have that thorough-going review. In fact, the Secretary of State for Trade and Industry said on 9th November, 1970: I am conducting a major study into all aspects of regional policy."—[OFFICIAL REPORT, 9th November, 1970; Vol. 806, c. 3.] Over the last few months the study got lost for a while. In February we found that it had been taken over by the Secretary of State for the Environment. Indeed, not only had he taken it over but he had finished it, because on 22nd February he said: no further changes … in regional industrial policy are planned at the present time."—[OFFICIAL REPORT, 22nd February, 1971; Vol. 812, c. 42.] Many of us thought that that was the end of the review.

Instead of taking regional policy seriously, however, the Government actually reduced regional preferential aid to manufacturing industry. I hope to be able to prove that presently. However, even they realised that the situation was very unsatisfactory and last October, at the Tory Party conference, the Secretary of State for Trade and Industry, who seemed to have taken over the responsibility again, announced that a new study in depth of unemployment in development areas was to be carried out. The Guardian next day carried a feature by Mr. Ian Aitken headed: Davies asks 'Think Tank' to break regional barrier. A similar story appeared in the Financial Times.

From our point of view total confusion had been created and we had to wait for a Tory Party conference for that long, thorough-going review to begin. I hope to ask the Minister about that in a few moments. This afternoon, in opening the debate for the Government, the Secretary of State for the Environment made no mention of this. We want to know what the Government have in mind because these stories have not been denied.

No one would deny the Government the opportunity of carrying out a thorough-going review of regional policy. That is their right. A new and incoming Government have every right to consider the matter, but the deliberate scrapping of vital regional incentives in advance of any study has done irreparable damage to the development areas, as everybody knows and as we warned would happen. It is no good the Secretary of State for Employment saying, as he did during a debate on unemployment, that he cared about the unemployed and that it was really all a case of Government misjudgment.

It is not a case of Government misjudgment. It is a case of Government incompetence, because, when announcing the ending of investment grants and R.E.P., the Chancellor of the Exchequer said: we are confident that the new arrangements will prove more effective."—EOFFICIAL REPORT, 27th October, 1970; Vol. 805, c. 48.] We know that they are not more effective.

There was an article in The Guardian in October this year by Mr. John Rhodes, a research officer at the Department of Applied Economics at Cambridge, in which he said: The value of development area differential investment incentives for manufacturing industry is now very small compared with the grant system operating from 1966–70. Mr. Rhodes makes the case which I can best summarise by saying that the changes in tax allowances, the further changes in depreciation allowances for non-development area firms, announced in the July mini-budget, plus the corporation tax changes have diminished the value of incentives to manufacturing activities in the development areas.

I think that this matter was raised by the hon. Member for Cornwall, North (Mr. Pardoe). Mr. Rhodes shows quite clearly that for every £100 invested in plant and equipment the advantage for development areas over non-development areas has been devalued from a sizeable 12 per cent. to a tiny 1·8 per cent. In a more recent article in the Financial Times of 15th November John Trafford made the same point when he said: The disparity between incentives in development and non-development areas … has dwindled sharply since the Chancellor's budget last year. We do not have to take simply the words of the commentators for it because on 15th November the Secretary of State for Trade and Industry admitted to me at Question Time that the Government had reduced investment differentials for manufacturing industry in the development areas. That was what the right hon. Gentleman said from the Dispatch Box.

Let the Government stop this pretence that their range of incentives for development areas is more effective than what applied before. Every informed commentator on these matters has denied it and all the evidence rebuts it, too. For example, when Sir Val Duncan, Chairman and Chief Executive of Rio Tinto Zinc gave evidence to the Select Committee on Expenditure he had some revealing things to say about the decision whether to allocate the aluminium smelter to Anglesey. He said: the grant was critical; if there had been no grant there would have been no smelter. When he was questioned by a member of that Committee about tax allowances, rather than grants he said: if it had been allowances and not grants we would not have started. That is conclusive.

The three indicators which we can use to judge the effectiveness of regional policy are, first, the regional unemployment figures; second, the number of approved applications for I.D.C.s; and third, the take-up of assistance under the Local Employment Acts.

Several hon. Members have raised the problem of the South-West Region. In that region unemployment has risen by 67 per cent. since the present Government came to power. There have been 16,000 redundancies in the South-West and five unemployed adults are chasing every job compared with three a year ago. In the North-West unemployment has risen by 81 per cent., 70,400 redundancies have been declared and the number of jobless adults for each vacancy has risen from four to 11. In the Northern Region unemployment has risen by 49 per cent. from an already very high and unacceptable level, there have been 27,600 redundancies and the number of adults chasing every vacancy has doubled from eight to 16.

During the last 15 months of the Labour Government the number of industrial development certificates issued was 7,860. In the first 15 months of the Tory Government there were 4,872, a massive reduction of 38 per cent., and half of those 4,872 were already in the pipeline under the Labour Government.

The same sorry picture can be seen when we examine the take-up figures of assistance to industry in the regions under the Local Employment Acts. In the last full year of the Labour Government Local Employment Acts assistance in England reached the record figure of £49 million. The latest published accounts show a reduction to £36 million, a drop of £13 million, in absolutely vital regional aid to assisted areas in England alone, not counting Scotland and Wales. This comes after the Chancellor of the Exchequer said in October, 1970, that there would be a build-up of additional expenditure of £25 million under the Local Employment Acts. It seems that the Chancellor's judgment on that, too, was out, as it has been on so many other things.

If the Government knock several crucial pegs out of the range of regional measures of assistance without proper study, as they have done, it becomes obvious why I.D.C.s are at such a low level, why redundancies are so high and why assistance under the Local Employment Acts is stunted. Even the Government's own supporters in the country have recognised this sorry situation. Mr. Nigel Lawson has said that R.E.P. ought to be kept. The Sunday Times in September, and even The Times yesterday, said that investment grants ought to be reintroduced.

What the House wants to know is what priority the Government are giving to the review of regional policy announced by the Secretary of State for Trade and Industry at the Tory Party conference and what form the review will take. Can the Under-Secretary confirm that this study is taking place? Is a study now taking place? If so, who is in charge? Is it the Secretary of State for Trade and Industry or is it the Secretary of State for the Environment?

The silence makes matters pretty obvious. The Government do not want to tell us. However, they have a review going, so I want to ask some questions about it. I am prepared to give way immediately if a spokesman for the Government wishes to rise and say that they have not got a study going. However, they have a study going and they know it, but they will not reveal why they have it going and what its terms of reference are.

After having made a mess of it, it is proper for the Government to get a review going now. However, will the review be a genuine one or will it be another sham? How long will it take? What is the time scale? Can we expect the conclusion of the review in the New Year or will it take months? Certainly those in the development areas and the regions cannot wait for ever.

It is no good the Minister ducking this one. We want an answer. We expect an answer when the Under-Secretary replies, so he had better ask his two right hon. Friends beside him so that he can give us the date for the conclusion of the review. The Government must have a date in mind; they must know the date they have set for the study's completion. Probably they do not want to tell us because it will be such a long review and it has been put off such a long time; they do not want to reveal the date so that it will not appear to those who are out of work in the regions that the Government do not care about this matter. When the review is completed, and we hope it will be sooner rather than later, its conclusions should be made known to this House and published in a White Paper. I hope that the Under-Secretary has taken that on board, too.

Most important of all, can we have the assurance that the review will be undertaken without Government dogma? We all know that the Government are having second thoughts about their lame duck policy and about public expenditure schemes to create jobs. The Secretary of State for the Environment this afternoon gave us his particular catalogue of incentives. Every one of them involved public expenditure. Eighteen months ago we were told this was the preaching of the Government—that unfettered private enterprise was the only economic panacea. Now, the Government tell us that public enterprise is the only way to get the job done.

Therefore, let those conducting the review listen to expert advice. Let them listen, for example, to Mr. Ernest Barrett, the President of the Engineering Industries' Association, who said a few weeks ago: The switch from investment grants to initial allowances was a retrograde step. That was what Mr. Barrett said on this matter. Only yesterday Lord Clydesmuir, the Chairman of the Scottish Council (Development and Industry) said: The council advocates a return to investment grants for development areas only. The Government should listen to Professor MacKay of Aberdeen University and Kevin Allen when they say: We consider it important … in particular that the decision to end R.E.P. and the move from investment grants to allowances be reversed. The Government should also look at what the T.U.C. said at a National Economic Development Council meeting last Tuesday. I think that both Secretaries of State attended that meeting. The T.U.C. said: The Regional Employment Premium worth £100 million a year should be continued past 1974. It is a major subsidy received by both new and indigenous firms in development areas, and its discontinuance will do irreparable harm. I hope that the Government and those conducting the review will take that on board, too.

Now especially, when the Secretary of State for the Environment is such a convert to public enterprise, the review should be asked to see how far public expenditure can be used within development areas and much more than it has been used in the past. I must say that my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) made this point extremely forcefully this afternoon. I found it ironic that when the Confederation of British Industry met both Ministers, if reports in the papers are anything to go by, the C.B.I. did not ask for less State intervention but in the short term argued for more State intervention.

The urgency of establishing a coherent strategy for the regions is absolutely vital. Week after week we have been told by the Government in the House of their whole catalogue of taxation changes, as though they constituted some magic which would make all the problems of the development areas go away. Again and again the Government have trotted out that argument. I must say to them in all seriousness that we do not take to this very kindly because we are absolutely fed up to the back teeth that every time we challenge the Government about getting a regional strategy they simply trot out all those figures.

It is no guarantee that when or if the economic pace quickens in the regions Britain will immediately and correspondingly improve. That is not so and the available evidence shows that it is not so. There is a time lag between what happens in the economy generally and what happens in the development areas. Even assuming that the Prime Minister is right when he says that we are on the brink of unparalleled growth in the economy, with regional incentives devalued for manufacturing industry the time lag for recovery in the development areas will be even longer.

As this year draws to a close the unemployment position is absolutely tragic. In the development areas it is sheer misery. At the start of 1971 the Secretary of State for Trade and Industry, in his New Year message to industry in the Trade and Industry Journal, said: The first vital question for 1971 is how industry will respond to changes of direction which the Government begin to apply.… The measures we have taken should ensure that, as the economy quickens and investment rises, the rate of growth in the less favoured areas in both manufacturing and service industries will be even greater. We all know how that 1971 message has turned out. There is record unemployment, the development areas are even worse off and the Prime Minister is begging industrialists to invest. So we look forward with great interest to what the Secretary of State will put in the Journal in 1972. [HON. MEMBERS: "The same old stuff."] Yes, it might be.

The Government get indignant and work themselves up into a state every time anyone accuses them of deliberately creating unemployment. But they cannot have it both ways. If they did not deliberately create it, they have certainly proved themselves utterly powerless and totally incompetent to deal with it. That is why the jobless men in the development areas condemn the Government and that is why we will vote against them tonight.

9.28 p.m.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

This has been an extremely interesting and helpful debate. I have been struck by the number of hon. Members opposite who have made thoughtful and constructive speeches—in marked contrast to the hon. Member for Chesterfield (Mr. Varley), and to the hon. Member for Newcastle-upon-Tyne, West (Mr. Bob Brown), who said that he would not make a party political speech and then proceeded to do exactly that.

I entirely agree with my hon. Friend the Member for Tynemouth (Dame Irene Ward) that these debates should be on a constituency basis, debates in which hon. Members produce examples of what is happening in their own constituencies, rather than debates full of too many theories. Therefore, I welcome the fact that hon. Members have spoken with conviction of the difficulties of their constituencies, as I have found it helpful to discuss many times with hon. Members in development areas the difficulties which they face.

This debate has covered a wide field and has reflected the deep anxiety of hon. Members on both sides representing constituencies within and without development areas at the current high level of unemployment. There are differences between hon. Members about what I might call the "tactics" of dealing with the problems of the development areas and about how best new employment might be brought to these areas. These differences have been emphasised in the debate.

I think it was apparent, too, that hon. Members on both sides of the House were by no means agreed as to the right solution. But it would be wrong if we did not acknowledge that there were no differences between the two sides on the fundamental point that unemployment at the present rate, and especially on the scale suffered in the development areas, is intolerable both in human and in economic terms and causes deep distress. [Interruption.]

I gather that hon. Gentlemen opposite do not take this matter seriously. If not, they will be condemned for hypocrisy in what they say. But there is no doubt that hon. Members who have taken part in this debate are deeply concerned, and I ask them to believe that I, too, am deeply concerned, as are the Government.

I think most sensible people will agree that the most acute problem which faced this Government on taking office was the depressed state of industrial confidence. This was the direct result of years of low growth, declining profits, high inflation and industrial disruption, and years of uncertainty about whether the country would become a member of the E.E.C. This lack of business confidence has led to low investment, stock rundown, unwillingness to expand output and, above all, the unemployment we have been debating today. But for the development areas these national problems made a situation which was already bad that much worse. [Laughter.]

It is all very well for hon. Gentlemen opposite to laugh, but in the more sensible speeches—those that have been honest enough to be sensible rather than playing party politics—hon. Gentlemen opposite have recognised this to be a long and deep seated problem, and those speeches I have found helpful.

Since the First World War, and perhaps before that, the development areas have had to face the problem of the decline of the basic industries—coal mining, textiles, shipbuilding, railway rolling stock and marine engineering—on which they were so heavily dependent. Employment in the industries I have mentioned, together with agriculture, fell by over one million in the 1960's alone, and the development areas had to take the brunt of these job losses. Thus, rightly, measures have been directed at attracting new industries to the development areas to offset these job losses.

I was impressed by the speech of the hon. Member for Liverpool, West Derby (Mr. Ogden), who set out to do what he succeeded in doing, partially at any rate, and that was to indicate how attractive his constituency and Merseyside were as a place for people to live and work. He stressed, as did the hon. Member for Cleveland (Mr. Tinn) and my hon. Friend the Member for Bolton, West (Mr. Redmond), the vital importance of an area not getting a had name. They were absolutely right to say that one of the worst reputations an area can get is a name for bad labour relations.

I have always been impressed by the fact that when hon. Members have brought deputations to see me to discuss how they can help themselves and advertise their areas to encourage industry, they have always laid great stress on good labour relations, and I am glad that hon. Members have done that today.

As to North-East—

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

Is the hon. Gentleman aware that there is some utter rubbish talked about industrial relations on Merseyside? Is he aware that during the period of the last Government I put down a Question asking how many more strikes there were on Merseyside, how many more days lost through industrial action than in other parts of the country, and I was told that this information could not be given because there were no records? Is he further aware that the true situation is that things are no worse on Merseyside than anywhere else, and that those who perpetuate this myth do a great disservice to Merseyside—and this includes hon. Members opposite?

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

I am delighted that the hon. Gentleman, who made a thoughtful speech, has made that point. It is not hon. Members on this side but industry which has to be persuaded to go to these areas. I was pleased that he and the hon. Member for Liverpool, West Derby made this point about the area. I hope that hon. Members opposite will bear these facts in mind and do their best to prevent areas from getting a bad name among what might be called the mobile industries.

My hon. Friend the Member for Bolton. West referred to the problem of dereliction and inquired about the powers to make designations. The Bill in another place is a consolidation Measure, and the authority derives from the Industrial Development Act, 1966, which gives power to deal with derelict land. Grants of 85 per cent. are now available to local authorities in development areas towards the cost of acquiring and clearing the land when the Secretary of State for the Department of Trade and Industry is satisfied that it would contribute to the development of industry. That deals with my hon. Friend's point.

Photo of Mr Robert Redmond Mr Robert Redmond , Bolton West

As I read that Clause of the Bill it said that a non-development area could get the same treatment as a development area if the Secretary of State agreed. I do not want to know about development areas. Bolton is not one.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

Perhaps if I continue it will be apparent. My right hon. Friend has to be satisfied that it would contribute to the development of industry. I am glad to be able to tell the House that since 1966 this power has been extended to intermediate and derelict land areas, where 75 per cent. grants are payable, and the latter includes most of Yorkshire and Lancashire outside the assisted areas, including, I believe, my hon. Friend's constituency. It is important to remember that the grant being paid to local authorities in development areas in 1971–72 was £1·15 million compared with a mere £500,000 in 1969–70.

Many hon. Members raised the question of the dispersal of the Civil Service and Government Departments. This is an important matter because of the great growth potential of the service industries, which have been treated so much better under this Government than under the previous Government. I know that many hon. Gentlemen wish to attract offices and service industries to their constituencies. I accept that they regard the advent of a Government office as being in the nature of a pump primer.

The right hon. Member for Sunderland, North (Mr. Willey), the hon. Member for Whitehaven (Dr. John A. Cunningham), and my hon. Friends the Members for Middlesbrough, West (Mr. Sutcliffe), Bodmin (Mr. Hicks) and Liverpool, Wavertree (Mr. Tilney), to name but a few, all made their claim for Government offices. The Government are undertaking a review of the headquarters work of Government Departments, which is more than the previous Administration did, to see whether more of them can be dispersed away from London, and, if so, where they should go. It is a complex task, and it will be some time before it is completed and the Government are in a position to announce decisions. All I can say at this stage is that the needs of the development areas will be taken seriously into consideration.

I turn to the speeches of the right hon. Member for Sunderland, North and my hon. Friend the Member for Middlesbrough, West, who raised the question of the British Steel Corporation's long-term investment programme. I think that my hon. Friend the Member for Liverpool, Wavertree also mentioned it. All three rightly pointed out that it is vital to their constituencies, as it is to others. That programme is a matter in the first instance for the corporation. We are following exactly the same practice as the previous Administration did, but a joint review is in progress, and my right hon. Friend will make an announcement as soon as possible.

My hon. Friends for Bodmin and St. Ives (Mr. Nott) turned our attention towards the South-West. My hon. Friend the Member for Bodmin said that in his judgment the framework of the regional area there was wrong. He pointed out that there was higher unemployment further to the west in his region. The explanation is undoubtedly the difficulties of communication, and it is precisely here that the infrastructure becomes so important. Both the A30 and the A38 roads will be comprehensively improved, and the M4 will be completed at the end of this year. The M5 and the A38 spine road will be completed to Plymouth by the mid-1970s, and as a result there will be high-quality roads from both the Midlands and London to the South-West.

Photo of Mr Robert Hicks Mr Robert Hicks , Bodmin

Without being cynical, I think that I can now understand why my hon. Friend has not accepted my invitation to drive down to my constituency since he has held his present office. Although I welcome the improvements in the road-building programme, I ask that they be carried out much more quickly.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

I will always accept an invitation to go down to see my hon. Friend, but he must face the fact that there has been a massive advance in road programmes under the present Government, particularly in his area.

The right hon. Member for Sunderland, North—[HON. MEMBERS: "Again?"]—I assume that it is the wish of hon. Members that the points they raise should be dealt with in the wind-up speech. Whether or not they like to receive the replies, I assure them that they will get them.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

The hon. Gentleman did not take part in the debate. He must be patient.

Photo of Mr Thomas Urwin Mr Thomas Urwin , Houghton-le-Spring

I did not speak, but I have sat here all day listening to lots of rubbish spoken by hon. Members opposite in half-hour speeches.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

The right hon. Member for Sunderland, North referred to the possibility of a regional development authority. My right hon. Friend the Secretary of State told the members of the T.U.C. at their meeting on 27th August that the proposal for a regional development authority would be very carefully considered. The concept of development agencies is interesting and this device has been employed in several other countries. There are, however, limitations to small, separate agencies based on specific areas. By their very nature they would be unlikely to build up the necessary breadth of expertise required for the consideration in depth of projects put to them. Moreover they might also be restricted in their ability to initiate and put forward possible projects to industry.

Private finance is able to provide for projects with sound economic prospects and there should at present be no shortage of funds for this. Plainly we do not want to create an institution to finance projects for which there is no prospect of sound operation. They would, apart from anything else, provide no jobs. There is possibly an area—for example, projects on which the return would be longer delayed than was acceptable to the market—in which a development agency might operate. This is something which should be considered and we have noted carefully what the right hon. Gentleman said.

Photo of Mr Frederick Willey Mr Frederick Willey , Sunderland North

I am sure the Minister will be obliged to me for giving him the opportunity to give way. Who will consider this question? Will it be considered by the body that is considering development area policy generally and will the reply be by way of a White Paper?

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

As the T.U.C. was told, it will be considered by the Government. I shall come in due course to the question which the right hon. Gentleman has raised.

What is often overlooked is how substantial the assistance available to development areas really is. There is an opportunity to purchase or use rent-free a Department of Trade and Industry factory. There are building grants the rates of which have been increased by 10 percentage points compared with the rates during the period of the Labour Government. We have adopted a more liberal approach to capital loans granted under the Local Employment Acts. There are removal grants and there are special industrial training facilities for firms expanding in the development areas. There are also the tax allowances which have been referred to.

In addition to all these measures the Government have announced since July some £450 million worth of increased public expenditure to relieve unemployment in the short term, especially in the development areas, while the measures which my right hon. Friend the Chancellor of the Exchequer has taken generally to stimulate the economy take effect. These general economic measures, the overall scale of which is unprecedented, include tax cuts equivalent to £1,400 million in a full year, the abolition of hire purchase restrictions and cheaper and easier credit, with Bank Rate at its lowest level for seven years. If hon. Gentlemen opposite do not like that, they should say so.

It is clear that inroads into the present exceptional high level of employment in the development areas will be made and a solution found to the long-term problem of structural unemployment only by faster and sustained growth in the national economy—a lot faster and more sustained than occurred during the six years of Labour Government.

If that is achieved it will lead to greater activity in industries already in the development areas and will encourage industrialists to come forward with new projects which the development areas, with all the incentives they can offer, will be well placed to secure. Of course it takes time for the economy to respond to general stimulus, but many of the speeches today have been unnecessarily pessimistic.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

I am sorry, I cannot give way.

There are a number of encouraging signs. Yesterday there was the news that consumer expenditure in October was 3 per cent. higher than in September. Sales of consumer durables in the three months ended October were 9 per cent. up and in the same period total new hire purchase credit was 30 per cent. higher. There are real signs of substantial progress in dealing with price inflation.

Photo of Mr Michael Foot Mr Michael Foot , Ebbw Vale

When the hon. Gentleman talks about all these encouraging signs, will he say when he thinks the Government will be able to bring down the unemployment figure to what it was in June, 1970?

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

What I will undertake to the hon. Gentleman is that in our period of Government unemployment will not double as it did under the Labour Administration.

I refer the hon. Gentleman to the National Institute's Eonomic Review, to which many hon. Members opposite refer when it suits them. That review concluded the other day that the July measures have had a substantial impact on demand … and there is no reason to think that output will not eventually adjust more fully than it has so far, followed by the level of unemployment". The review also mentions that private housebuilding was more buoyant than it expected and that exports had outstripped expectations.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

No, not for the moment. Similarly the Financial Times survey of business opinion, discussing prospects for investment, reports that A greater proportion of business men say they plan to increase expenditure in the next 12 months.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

No. If I give way to anybody, it will be to the hon. Member for Ince (Mr. McGuire).

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

I thank the hon. Gentleman for giving way. He said that he would respond to the speeches which had been made. Will he answer the point which was put to him about discrimination in the Lancashire non-development areas in relation to urban renewal?

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

I cannot deal with that matter in detail, but I will say a word at this stage on the question of designating more assisted areas, which is at the base of the point made by the hon. Gentleman, as was the question of Teesside which was also raised. Several other hon. Members made contributions on this aspect.

It is true that my right hon. Friend has the power to do this but he is required by Statute to have regard of all the circumstances, actual and expected, including the state of employment and unemployment, population changes, migration and objectives of regional policy. These words are not a mere formality. It is the objective of our regional policy to concentrate the largest benefits in the special development areas. Those are the areas where the problem of redevelopment and of unemployment has been most impracticable. This means that year by year over several decades we have had to find new employment and new industries for a large number of people. We cannot solve this problem by adding over and over again to the number of special development areas.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

No, I cannot give way to the hon. Gentleman.

That spreads the limited supply of mobile industry throughout the country too thinly. We shall keep the boundaries under constant review and will continue to have regard to the points made by hon. Members but we must have a period of certainty and stability for the benefit of industry.

The hon. Member for Chesterfield mentioned the review of regional policy which took place last winter and asked about the further study on which we are now embarking. I assured him that the review we made last winter was a thorough, full and workmanlike performance. In fact, it resulted in something which I thought hon. Gentlemen opposite wanted and something which they did not get from their own Government, namely, the creation of special development areas in places of very high unemployment.

I am sorry that some of the constituencies of hon. Members opposite, notably that of the hon. Member for Chesterfield, were not included in the extension of assisted areas. I am afraid that the very nature of regional policy means that there has to be a degree of discrimination.

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

The question to which we want an answer concerns not the sham review of last winter but whether the Government have another review in progress at present. If they have, when will it be completed and will the conclusions be published in a White Paper?

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

If the hon. Gentleman had not been so impatient I should have given him the answer by now. As to the further study about which he asks, I refer hon. Members to the words of my right hon. Friend the Prime Minister in opening the debate on the Address. My right hon. Friend said: The regional measures that we are using today are not a complete answer"— [Interruption.] The ones to which my right hon. Friend was referring were, of course, those which we inherited from the previous Administration. My right hon. Friend went on to say: … we are now studying the alternative options which may be open to us."—[OFFICIAL REPORT, 2nd November, 1971; Vol. 825, c. 45.] Subsequently my right hon. Friend the Secretary of State made it clear that the aim should be both for simplification and for more direct means of tackling the individual problems of individual areas. He also said that our study of the subject was not a short-lived affair. In fact, it is a progressive and continuous operation which is being undertaken continually. I can tell the hon. Gentleman also that our continuing study is very wide-ranging. Beyond that I shall not tell the hon. Gentleman any more.

I want to deal quickly with the other points that the hon. Gentleman raised.

I have dealt with his point about the study. [Interruption.] Hon. Gentlemen opposite seem to be obsessed with one point—[HON. MEMBERS: "Unemployment."] Unemployment, yes, and the way to deal with it. The only way that they can suggest is by means of investment grants.

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

Can we have a statement on the regional employment premium?

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

If hon. Gentlemen opposite imagine that putting indiscriminately large sums of money into capital-intensive industry will produce employment, they are deluding themselves and their constituents.

R.E.P. was brought in by the previous Administration for a limited period. They themselves promised it for seven years. It was to expire in 1974. We are honouring that promise because of the commitments which have been taken on. But if hon. Gentlemen opposite think that we should not replace what was essentially an unsatisfactory and wasteful policy which did not do the task that it was supposed to do, I can assure them that we have every intention of replacing it by producing an alternative which is very much better.

More has been done in terms of infrastructure, financial and administrative assistance to help the development areas—

Photo of Mr Walter Harrison Mr Walter Harrison , Wakefield

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 265, Noes 302.

Division No. 28.]AYES[10.0 p.m.
Abse, LeoBeaney, AlanBuchanan, Richard (G'gow, Sp'burn)
Albu, AustenBenn, Rt. Hn. Anthony WedgwoodButler, Mrs. Joyce (Wood Green)
Allaun, Frank (Salford, E.)Bennett, James (Glasgow, Bridgeton)Callaghan, Rt. Hn. James
Allen, ScholefieldBidwell, SydneyCampbell, I. (Dunbartonshire, W.)
Archer, Peter (Rowley Regis)Bishop, E. S.Cant, R. B.
Armstrong, ErnestBlenkinsop, ArthurCarmichael, Neil
Ashley, JackBoardman, H. (Leigh)Carter, Ray (Birmingh'm, Northfield)
Ashton, JoeBooth, AlbertCarter-Jones, Lewis (Eccles)
Atkinson, NormanBottomley, Rt. Hn. ArthurCastle, Rt. Hn. Barbara
Bagier, Gordon A. T.Bradley, TomClark, David (Colne Valley)
Barnes, MichaelBroughton, Sir AlfredCocks, Michael (Bristol, S.)
Barnett, Guy (Greenwich)Brown, Bob (N'c'tle-upon-Tyne, W.)Cohen, Stanley
Barnett, Joel (Heywood and Royton)Brown, Hugh D. D. (G'gow, Provan)Coleman, Donald
Baxter, WilliamBuchan, NormanConcannon, J. D.
Conlan, BernardHunter, AdamParker, John (Dagenham)
Corbet, Mrs. FredaIrvine, Rt. Hn. Sir Arthur (Edge Hill)Parry, Robert (Liverpool, Exchange)
Cox, Thomas (Wandsworth, C.)Janner, GrevillePavitt, Laurie
Cronin, JohnJay, Rt. Hn. DouglasPeart, Rt. Hn. Fred
Crosland, Rt. Hn. AnthonyJenkins, Hugh (Putney)Pentland, Norman
Crossman, Rt. Hn. RichardJohn, BrynmorPerry, Ernest G.
Cunningham, G. (Islington, S. W.)Johnson, Carol (Lewisham, S.)Prentice, Rt. Hn. Reg.
Cunningham, Dr. J. A. (Whitehaven)Johnson, James (K'ston-on-Hull, W.)Prescott, John
Dalyell, TamJohnson, Walter (Derby, S.)Price, J. T. (Westhoughton)
Davidson, ArthurJones, Barry (Flint, E.)Price, William (Rugby)
Davies, Denzil (Llanelly)Jones, Dan (Burnley)Probert, Arthur
Davies, G. Elfed (Rhondda, E.)Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)Rankin, John
Davies, S. O. (Merthyr Tydvil)Jones, Gwynoro (Carmarthen)Reed, D. (Sedgefield)
Davis, Clinton (Hackney, C.)Jones, T. Alec (Rhondda, W.)Rees, Merlyn (Leeds, S.)
Davis, Terry (Bromagrove)Judd, FrankRhodes, Geoffrey
Deakins, EricKaufman, GeraldRichard, Ivor
Kelley, RichardRoberts, Albert (Normanton)
de Freitas, Rt. Hn. Sir GeoffreyKerr, RussellRoberts, Rt. Hn. Goronwy (Caernarvon)
Delargy, HughLambie, DavidRobertson, John (Paisley)
Dell, Rt. Hn. EdmundLamond, JamesRoderick, Caerwyn E. (Br'c'n & R'dnor)
Dempsey, JamesLawson, GeorgeRodgers, William (Stockton-on-Tees)
Doig, PeterLeadbitter, TedRoper, John
Dormand, J. D.Lee, Rt. Hn. FrederickRose, Paul B.
Douglas, Dick (Stirlingshire, E.)Leonard, DickRoss, Rt. Hn. William (Kilmarnock)
Douglas-Mann, BruceLestor, Miss JoanSandelson, Neville
Driberg, TomLever, Rt. Hn. HaroldSheldon, Robert (Ashton-under-Lyne)
Duffy, A. E. P.Lewis, Arthur (W. Ham, N.)Shore, Rt. Hn. Peter (Stepney)
Dunn, James A.Lewis, Ron (Carlisle)Short, Rt. Hn. Edward (N'c'tle-u-Tyne)
Dunnett, JackLipton, MarcusShort, Mrs. Renée (W'hampton, N. E.)
Edelman, MauriceLomas, KennethSilkin, Rt. Hn. John (Deptford)
Edwards, Robert (Bilston)Loughlin, CharlesSilkin, Hn. S. C. (Dulwich)
Edwards, William (Merioneth)Lyon, Alexander W. (York)Silverman, Julius
Ellis, TomLyons, Edward (Bradford, E.)Skinner, Dennis
English, MichaelMabon, Dr. J. DicksonSmall, William
Evans, FredMcBride, NeilSmith, John (Lanarkshire, N.)
Ewing, HarryMcCann, JohnSpearing, Nigel
Faulds, AndrewMcCartney, HughSpriggs, Leslie
Fernyhough, Rt. Hn. E.McElhone, FrankStallard, A. W.
Fisher, Mrs. Doris (B'ham, Ladywood)McGuire, MichaelSteel, David
Fitch, Alan (Wigan)Mackenzie, GregorStewart, Rt. Hn. Michael (Fulham)
Fletcher, Raymond (Ilkeston)Mackie, JohnStoddart, David (Swindon)
Fletcher, Ted (Darlington)Mackintosh, John P.Stonehouse, Rt. Hn. John
Foley, MauriceMaclennan, RobertStrang, Gavin
Foot, MichaelMcMillan, Tom (Glasgow, C.)
Ford, BenMcNamara, J. KevinStrauss, Rt. Hn. G. R.
Forrester, JohnMahon, Simon (Bootle)Summerskill, Hn. Dr. Shirley
Fraser, John (Norwood)Mallalieu, J. P. W. (Huddersfield, E.)Taverne, Dick
Freeson, FeginaldMarks, KennethThomas, Rt. Hn. George (Cardiff, W.)
Galpern, Sir MyerMarsden, F.Thomas, Jeffrey (Abertillery)
Garrett, W. E.Marshall, Dr. EdmundTinn, James
Gilbert, Dr. JohnMeacher, Michael
Ginsburg, David (Dewsbury)Mellish, Rt. Hn. RobertTomney, Frank
Golding, JohnMendelson, JohnTorney, Tom
Gordon Walker, Rt. Hn. P. C.Mikardo, IanTuck, Raphael
Gourlay, HarryMiller, Dr. M. S.Urwin, T. W.
Grant, George (Morpeth)Milne, EdwardVarley, Eric G.
Grant, John D. (Islington, E.)Mitchell, R. C. (S'hampton, Itchen)Wainwright, Edwin
Griffiths, Eddie (Brightside)Morgan, Elystan (Cardiganshire)Walden, Brian (B'm'ham, All Saints)
Griffiths, Will (Exchange)Morris, Alfred (Wythenshawe)Walker, Harold (Doncaster)
Grimond, Rt. Hn. J.Morris, Charles R. (Openshaw)Wallace, George
Hamilton, William (Fife, W.)Morris, Rt. Hn. John (Aberavon)Watkins, David
Hamling, WilliamMoyle, RolandWeitzman, David
Hannan, William (G'gow, Maryhill)Mulley, Rt. Hn. FrederickWellbeloved, James
Murray, Ronald KingWells, William (Walsall, N.)
Hardy, PeterOakes, GordonWhite, James (Glasgow, Pollok)
Harper, JosephOgden, EricWhitehead, Phillip
Harrison, Walter (Wakefield)O'Halloran, MichaelWilley, Rt. Hn. Frederick
Hart, Rt. Hn. JudithO'Malley, BrianWilliams, Alan (Swansea, W.)
Hattersley, RoyOram, BertWilliams, Mrs. Shirley (Hitchin)
Heffer, Eric S.Orbach, MauriceWilliams, W. T. (Warrington)
Hilton, W. S.Orme, StanleyWilson, Alexander (Hamilton)
Horam, JohnOswald, ThomasWilson, William (Coventry, S.)
Howell, Denis (Small Heath)Owen, Dr. David (Plymouth, Sutton)Woof, Robert
Hughes, Rt. Hn. Cledwyn (Anglesey)Paget, R. T.
Hughes, Mark (Durham)Palmer, ArthurTELLERS FOR THE AYES:
Hughes, Robert (Aberdeen, N.)Pannell, Rt. Hn. CharlesMr. James Hamilton and
Hughes, Roy (Newport)Pardoe, JohnMr. Tom Pendry.
Adley, RobertArcher, Jeffrey (Louth)Baker, Kenneth (St. Marylebone)
Alison, Michael (Barkston Ash)Astor, JohnBaker, W. H. K. (Banff)
Allason, James (Hemel Hempstead)Atkins, HumphreyBalniel, Lord
Amery, Rt. Hn. JulianAwdry, DanielBarber, Rt. Hn. Anthony
Batsford, BrianGilmour, Sir John (Fife, E.)Maginnis, John E.
Bell, RonaldGlyn, Dr. AlanMarples, Rt. Hn. Ernest
Bennett, Sir Frederic (Torquay)Godber, Rt. Hn. J. B.Marten, Neil
Bennett, Dr. Reginald (Gosport)Goodhart, PhilipMather, Carol
Benyon, W.Goodhew, VictorMaude, Angus
Berry, Hn. AnthonyGorst, JohnMaudling, Rt. Hn. Reginald
Biffen, JohnGower, RaymondMaxwell-Hyslop, R. J.
Biggs-Davison, JohnGrant, Anthony (Harrow, C.)Meyer, Sir Anthony
Blaker, PeterGray, HamishMills, Peter (Torrington)
Boardman, Tom (Leicester, S. W.)Green, AlanMiscampbell, Norman
Body, RichardGrieve, PercyMitchell, Lt.-Col. C. (Aberdeenshire, W)
Boscawen, RobertGriffiths, Eldon (Bury St. Edmunds)Mitchell, David (Basingstoke)
Bossom, Sir CliveGrylls, MichaelMoate, Roger
Bowden, AndrewGummer, SelwynMolyneaux, James
Boyd-Carpenter, Rt. Hn. JohnGurden, HaroldMoney, Ernle
Braine, BernardHall, John (Wycombe)Monks, Mrs. Connie
Bray, RonaldHall-Davis, A. G. F.Monro, Hector
Brewis, JohnHamilton, Michael (Salisbury)Montgomery, Fergus
Brinton, Sir TattonHannam, John (Exeter)More, Jasper
Brocklebank-Fowler, ChristopherHarrison, Brian (Maldon)Morgan, Geraint (Denbigh)
Brown, Sir Edward (Bath)Harrison, Col. Sir Harwood (Eye)Morgan-Giles, Rear-Adm.
Bruce-Gardyne, J.Haselhurst, AlanMorrison, Charles
Bryan, PaulHastings, StephenMudd, David
Buchanan-Smith, Alick (Angus, N & M)Hawkins, PaulMurton, Oscar
Buck, AntonyHay, JohnNabarro, Sir Gerald
Bullus, Sir EricHayhoe, BarneyNicholls, Sir Harmar
Burden, F. A.Heseltine, MichaelNoble, Rt. Hn. Michael
Butler, Adam (Bosworth)Hicks, RobertNormanton, Tom
Campbell, Rt. Hn. G. (Moray & Nairn)Higgins, Terence L.Nott, John
Carlisle, MarkHiley, JosephOnslow, Cranley
Channon, PaulHill, John E. B. (Norfolk, S.)Oppenheim, Mrs. Sally
Chapman, SydneyHill, James (Southampton, Test)Orr, Capt. L. P. S.
Chataway, Rt. Hn. ChristopherHolland, PhilipOsborn, John
Chichester-Clark, R.Holt, Miss MaryPage, Graham (Crosby)
Churchill, W. S.Hordern, PeterPage, John (Harrow, W.)
Clark, William (Surrey, E.)Hornby, RichardParkinson, Cecil
Clarke, Kenneth (Rushcliffe)Hornsby-Smith, Rt. Hn. Dame PatriciaPeel, John
Clegg, WalterHowe, Hn. Sir Geoffrey (Reigate)Percival, Ian
Cockeram, EricHowell, David (Guildford)Peyton, Rt. Hn. John
Cooke, RobertHowell, Ralph (Norfolk, N.)Pike, Miss Mervyn
Coombs, DerekHunt, JohnPink, R. Bonner
Cooper, A. E.Iremonger, T. L.Pounder, Rafton
Cordle, JohnIrvine, Bryant Godman (Rye)Powell, Rt. Hn. J. Enoch
Corfield, Rt. Hn. FrederickJames, DavidPrice, David (Eastleigh)
Cormack, PatrickJenkin, Patrick (Woodford)Prior, Rt. Hn. J. M. L.
Costain, A. P.Jennings, J. C. (Burton)Proudfoot, Wilfred
Critchley, JulianJessel, TobyPym, Rt. Hn. Francis
Crouch, DavidJohnson Smith, G. (E. Grinstead)Quennell, Miss J. M.
Crowder, F. P.Jones, Arthur (Northants, S.)Raison, Timothy
Dalkeith, Earl ofJopling, MichaelRamsden, Rt. Hn. James
Davies, Rt. Hn. John (Knutsford)Joseph, Rt. Hn. Sir KeithRawlinson, Rt. Fin. Sir Peter
d'Avigdor-Goldsmid, Sir HenryKellett-Bowman, Mrs. ElaineRedmond, Robert
d'Avigdor-Goldsmid, Maj.-Gen. JamesKershaw, AnthonyReed, Laurance (Bolton, E.)
Dean, PaulKilfedder, JamesRees, Peter (Dover)
Deedes, Rt. Hn. W. F.Kimball, MarcusRenton, Rt. Hn. Sir David
Digby, Simon WingfieldKing, Evelyn (Dorset, S.)Ridley, Hn. Nicholas
Dixon, PiersKing, Tom (Bridgwater)Ridsdale, Julian
Dodds-Parker, DouglasKinsey, J. R.Rippon, Rt. Hn. Geoffrey
Drayson, G. B.Kirk, PeterRoberts, Michael (Cardiff, N.)
du Cann, Rt. Hn. EdwardKitson, TimothyRoberts, Wyn (Conway)
Dykes, HughKnight, Mrs. JillRodgers, Sir John (Sevenoaks)
Eden, Sir JohnKnox, DavidRossi, Hugh (Hornsey)
Edwards, Nicholas (Pembroke)Lambton, AntonyRost, Peter
Elliot, Capt. Walter (Carshalton)Lane, DavidRoyle, Anthony
Elliott, R. W. (N'c'tle-upon-Tyne, N.)Langford-Holt, Sir JohnRussell, Sir Ronald
Legge-Bourke, Sir HarrySt. John-Stevas, Norman
Emery, PeterLe Marchant, SpencerScott, Nicholas
Farr, JohnLewis, Kenneth (Rutland)Scott-Hopkins, James
Fell, AnthonyLloyd, Rt. Hn. Geoffrey (Sut'n C'dfield)Sharples, Richard
Fenner, Mrs. PeggyLloyd, Ian (P'tsm'th, Langstone)Shaw, Michael (Sc'b'gh & Whitby)
Fidler, MichaelLongden, GilbertShelton, William (Clapham)
Finsberg, Geoffrey (Hampstead)Loveridge, JohnSimeons, Charles
Fisher, Nigel (Surbiton)Luce, R. N.Sinclair, Sir George
Fletcher-Cooke, CharlesMcAdden, Sir StephenSkeet, T. H. H.
Fookes, Miss JanetMacArthur, IanSoref, Harold
Fortescue, TimMcCrindle, R. A.Speed, Keith
Foster, Sir JohnMcLaren, MartinSpence, John
Fowler, NormanMaclean, Sir FitzroySproat, Iain
Fox, MarcusMcMaster, StanleyStainton, Keith
Fry, PeterMacmillan, Maurice (Farnham)Stanbrook, Ivor
Galbraith, Hn. T. G.McNair-Wilson, MichaelStewart-Smith, Geoffrey (Belper)
Gardner, EdwardMcNair-Wilson, Patrick (New Forest)Stodart, Anthony (Edinburgh, W.)
Gibson-Watt, DavidMaddan, MartinStoddart-Scott, Col. Sir M.
Gilmour, Ian (Norfolk, C.)Madel, DavidStokes, John
Stuttaford, Dr. TomTurton, Rt. Hn. Sir RobinWiggin, Jerry
Sutcliffe, Johnvan Straubenzee, W. R.Wilkinson, John
Tapsell, PeterVaughan, Dr. GerardWinterton, Nicholas
Taylor, Edward M. (G'gow, Cathcart)Vickers, Dame JoanWolrige-Gordon, Patrick
Taylor, Frank (Moss Side)Waddington, DavidWood, Rt. Hn. Richard
Taylor, Robert (Croydon, N. W.)Walder, David (Clitheroe)Woodhouse, Hn. Christopher
Tebbit, NormanWalker, Rt. Hn. Peter (Worcester)Woodnutt, Mark
Thatcher, Rt. Hn. Mrs. MargaretWalker-Smith, Rt. Hn. Sir DerekWorsley, Marcus
Thomas, John Stradling (Monmouth)Wall, PatrickWylie, Rt. Hn. N. R.
Thomas, Rt. Hn. Peter (Hendon, S.)Walters, DennisYounger, Hn. George
Thompson, Sir Richard (Croydon, S.)Ward, Dame Irene
Tilney, JohnWarren, KennethTELLERS FOR THE NOES:
Trafford, Dr. AnthonyWells, John (Maidstone)Mr. Reginald Eyre and
Trew, PeterWhite, Roger (Gravesend)Mr. Bernard Weatheril.
Tugendhat, Christopher