Orders of the Day — Unemployment

Part of the debate – in the House of Commons at 12:00 am on 24 July 1978.

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Photo of Mr Teddy Taylor Mr Teddy Taylor , Glasgow Cathcart 12:00, 24 July 1978

The hon. Member for Blyth (Mr. Ryman) made a telling speech about the serious unemployment in his constituency, but some of us would have appreciated it more if, instead of popping in at the end of the debate to discuss this serious matter, he had been here earlier and thereby avoided keeping out those such as my hon. Friends the Member for Plymouth Sutton (Mr. Clark) and for Manchester, Withington (Mr. Silvester), who have sat here throughout in the hope of making a contribution about their constituencies.

Many views have been expressed in the debate, but at least there has been agreement on two things. The first is the desperate seriousness of the unemployment situation. The Minister of State made rather a silly attempt to add the temporarily-stopped figures of 1972 on a particular day when there were major industrial stoppages, in an effort to explain that the present figures were not so bad. But there is general agreement that the situation is desperately serious and has got a great deal worse in the last four years.

As my hon. Friend the Member for Cardiff, North-West (Mr. Roberts) rightly pointed out, in Wales the figure has gone up from 33,000 to over 90,000; the hon. Member for Belfast, South (Mr. Bradford) pointed out that in Northern Ireland the percentage figure has gone up from 6 per cent. to 13 per cent.; in Scotland, unemployment has risen from 77,000 to about 190,000 in the past four years—four years of a Government who went into the election on the basis of "Back to Work with Labour".

The second point on which there has been general agreement is that if, by chance, a Tory Government rather than a Labour Government had presided over these terrifying figures we would have had not a reasoned debate but an unseemly not. Before he took office the Leader of the House used always to be here for employment debates. As has been pointed out, when the unemployment figure was 600,000 in 1971, the right hon. Gentleman said that Labour would return to the question of unemployment day after day, week after week, month after month until the policies were changed. Now unemployment has reached 1½ million, but the right hon. Gentleman is not here. When he was Secretary of State for Employment, shortly after the Labour Government came to power, he said that he would not remain as Employment Minister and preside over mass unemployment. He did not do that. He changed offices and is now looking after devolution.

We have a desperately serious unemployment problem. It is frightening that, at the height of summer, the situation should be so catastrophic that in Scotland, despite the boost from North Sea oil and the seasonal gain from tourism, we have almost 200,000 people out of work. Unemployment has been the greatest failure in the Government's policy, and is totally at variance with the pledges that they gave to the people.

The Labour Party has always said that it has a kind of special respect for and special relationship with working people. But 600 working people have joined the dole queue every day since the Government took office. Seasonally adjusted, the increase is approaching 750,000 and in some areas the situation is appalling. There are some indications that things will get worse with the increase in national insurance charges and the special problems in international trade.

The figures have not been denied in the debate but we have had several alibis and excuses. We heard from the Minister of State and others, and particularly the hon. Members for Liverpool, Walton (Mr. Heifer) and for Chorley (Mr. Rodgers), who said that this was not a Labour Party problem and that it was not created by a Labour Government. The Minister of State said that it was all because of the international recession, and the hon. Member for Walton said that it was a crisis of capitalism.

Nobody would deny that there have been problems in world trade and that there has been a serious economic recession throughout the world. The facts are there. We condemn the Government, for the reason that when they came to power Britain was in a better state, in terms of jobs, than almost all our OECD competitors. Our unemployment was 2·8 per cent. and the OECD average figure was about 3 per cent. In other words, the Government started off, when they came to power, just a little better off than most of our competitors in that respect.

What has happened over the four years? We have the latest figures for the first quarter of 1978. They were provided in a Written Answer recently. Unemployment in the United Kingdom stands at 7·2 per cent. In the United States, the figure is 6·2 per cent.; in France it is 5·1 per cent.; in West Germany, it is 3·5 per cent.; in Italy, it is 3·5 per cent.; in Japan, it is 2·1 per cent.; in Sweden, it is 2·1 per cent., and so on. I ask the hon. Member for Walton and those who say that this is a capitalist problem and not a Labour Government problem, to explain why our country has performed so badly by comparison with the others which have been facing the same international problems.

The second argument put forward by some hon. Members, including the hon. Member for Liverpool, Garston (Mr. Loyden), is that we cannot blame the Government, because they have spent a great deal of mony. No one would deny that they have spent a great deal of taxpayers' money, pouring it into industrial investments, some sound and some very unsound.

The Secretary of State for Scotland always answers these debates in the same way. He starts by saying that unemployment in Scotland is 190,000; that the Government have put a great deal of taxpayers' money into the equivalent of 30,000 jobs; and that therefore, if it were not for the Labour Government, unemployment would be 220,000. He must know that that is bogus. I wonder whether he even recalls what he said in 1972, the worst Tory year for unemployment, but nothing like as bad as the present. He said: It is not much to the Government's credit that they should now be able to say that they are spending more on regional incentives, when it is they who have produced easily the worst post-war employment figures on record."—[Official Report, 27th July 1972; Vol. 841, c. 208 2.] The record that the Secretary of State now has is much worse than that which he condemned.

The Government must also remember that every penny which goes on aids to industry, whether they are sound or unsound, comes from the taxes and from firms which might otherwise have been able to provide more permanent jobs if they had been allowed to continue. I think that the Financial Times got it quite right when it said that: There is something ludicrous in the spectacle of a Government which subsidises employment in un-competitive industries by imposing a tax on jobs in productive ones. We have to remember that the money does not come out of trees and it does not come out of the printing press. In fact, Government spending in aids to industry has positively destroyed jobs in other fields, as we have seen from some of the investment of the SDA and other State organisations.

The third argument which is constantly advanced by the Government to explain the catastophic results of their policies is that things are getting better. I think that my right hon. and learned Friend the Member for Hexham (Mr. Rippon) was quite right in pointing out that almost every month since the Government came to power they have said that things are getting better. They say this particularly before by-elections or before local government elections.

Quite frankly, Mr. Speaker, the fact is that if the Trade Descriptions Act were to apply to the Chancellor of the Exchequer and the predictions that he has made, he could very well find himself in prison, and deserve to be there. In September 1974, he said: I am quite certain we can get through the whole of next year without 1 million unemployed. He did not say that he thought. He did not, like the Minister of State, say that he was making a wild guess. He said that he was certain, and, of course, he was wrong.

The Chancellor told us in April 1976: By the end of next year we shall be well on our way to the economic miracle. The only miracle has been to have the highest level of unemployment since the 1930s.

In May 1976 he said: We shall get unemployment down faster than any other country. The fact is that it has been slower than every country except Canada. Of course, just before the Garscadden by-election he told us about the 1 million jobs that were coming.

It is not enough just to complain about figures; we must ask ourselves to what extent the Government have been responsible for the situation. First, they have certainly been responsible because of their wildly irresponsible financial conduct when they came to power in 1974. We had the spending spree which brought this nation to bankruptcy, destroyed confidence and forced us to go to the IMF for a massive loan. Secondly, we condemn them because their high tax policies have destroyed initiative and enterprise, and this has cost jobs. Thirdly, we condemn them for what they have done to the small business sector. New ventures such as capital transfer tax have destroyed prosperity for family firms, as the hon. Member for Down, North (Mr. Kilfedder) rightly said. Fourthly, we cannot ignore the effect that the Government's policies on public ownership and nationalisation have had on business and industrial confidence.

Some people say that we are making a song and dance about this and that there is not a great deal in it, but those contemplating investment in this country look not just at what the Prime Minister says at banquets in the City but also at what is said by the Labour Party officially and by leading members of the Government. I was just thinking of what was said in a party political broadcast, not two or three years ago but on 15th June this year. In that broadcast there was talk about unemployment. Who was to blame? The answer was: The real blame lies with the industrialists who in their drive for profits have cynically closed firms and thrown millions on the dole. The Labour Party's aim is the common ownership of the means of production so that control of these firms can be taken out of the hands of the profiteers and the tycoons". Quite honestly, how can any industrialist, particularly one from abroad, contemplate investing in a country where wild things such as that are said on a party political broadcast? But, as my hon. Friend the Member for Ross and Cromarty (Mr. Gray) will know, like all things to do with the Labour Party, it is worse in Scotland. In Scotland we recently had a Labour Party conference at which a resolution was passed, almost unanimously, calling for the take-over of the hub of the economy. As well as 220 big manufacturing firms, the Labour Party in Scotland wants the nationalisation of banks and insurance institutions. That is fair enough, because the Labour Party agrees with that. But the conference also said that that nationalisation should be without compensation, except in cases of proven need". If you were to go out to America to try to persuade firms to come to Britain, Mr. Speaker. how could you do so when you have a Government in control whose party conferences talk about nationalisation without compensation as well as taking over all the means of production and doing away with the entrepreneurs?