Regional Employment Premium

Oral Answers to Questions — Trade and Industry – in the House of Commons at 12:00 am on 19th March 1973.

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Photo of John Horam John Horam , Gateshead West 12:00 am, 19th March 1973

asked the Secretary of State for Trade and Industry what recent representations he has had to the effect that the regional employment premium should be retained.

Photo of Mr Cranley Onslow Mr Cranley Onslow , Woking

The CBI wrote to my right hon. Friend last month recommending that the premium be retained until the end of 1978.

Photo of John Horam John Horam , Gateshead West

Is the hon. Gentleman aware that the CBI has also undertaken a survey which shows that the loss of jobs could be of the order of 20,000 to 50,000 as a result of the ending of the regional employment premium? Is he further aware that not only the TUC but the National Economic Development Office has already advocated retention of the premium? Can he say whether the present discussions taking place at the Department about the phasing-out of the premium mean that there is to be a total ending, or will there be any chance of a retention of some form of regionally differentiated labour subsidy?

Photo of Mr Cranley Onslow Mr Cranley Onslow , Woking

I am slightly surprised that the hon. Gentleman should think it possible for the CBI to make such calculations, isolating the effect of regional employment premium for the other regional incentives which have been produced and which prevail. The Government will be consulting both sides of industry about the phasing-out in the period ahead. Meanwhile no substantial reply has been sent to the CBI and our position remains that the premium will be phased out over the period from September 1974.

Photo of Mr John Biffen Mr John Biffen , Oswestry

Has the European Community, either formally or informally, at any time indicated its view on the general acceptability of the regional employment premium as a technique of regional policy?

Photo of Mr Cranley Onslow Mr Cranley Onslow , Woking

I am not aware that it has done so in the terms my hon. Friend suggests. He might like to note that at least one country in the Community has a scheme of reduced social security contributions the effect of which is similar to that of the premium.

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

Since the CBI's representations to the Government for the retention of the premium have now been reinforced by the chairman of the PEST Tory Group, would it not be much better for the Government to announce that the premium ought to be retained, improved and doubled if necessary as suggested by some commentators, rather than leave the House and the country suspended until we get what we are sure will be the Chancellor's cliff-hanging autumn Budget?

Photo of Mr Cranley Onslow Mr Cranley Onslow , Woking

The hon. Gentleman is wrong in most of what he says and specifically in what he said about the CBI, which has asked not that the premium should be retained but that the phasing-out period should be spread over four years.

Photo of Miss Irene Ward Miss Irene Ward , Tynemouth

Will my hon. Friend please bear in mind that at the time of the last General Election I did not support my party's view about the regional employment premium? Is he aware that I left myself free so that I could know the employment position in my part of the world when we came to take this decision? Is he further aware that if it is not satisfactory I will exercise my right to disagree with my party for once?

Photo of Mr Cranley Onslow Mr Cranley Onslow , Woking

I am not quite sure what my hon. Friend means by "for once".