I can well understand the feeling of victory on the Government Benches. Despite the economic decline of the past four years and the return of mass unemployment, the Government have been given a larger majority.
Of course, the split in the anti-Tory vote undoubtedly helped to produce the Government's majority, as did the feeling of a number of people that the Government needed more time for their policies to work and—this cannot be denied — the failure of the Labour party to persuade enough of the electorate that there was an alternative to mass unemployment.
The Government's line was that unemployment and the problems facing industry were due to overseas factors and the world recession. With the help of the media, Saatchi and Saatchi and the rest, the Government sold that line and many people, including Conservative voters, will suffer as a result.
During the election campaign, however, a draft report by the Select Committee on the Treasury and Civil Service, chaired by the right hon. Member for Taunton (Mr. du Cann), which must have been embarrassing for the Government, said that at least half the unemployment of the past few years has been caused by Government policies. We tried to get that message across during the election campaign.
It did not take the Prime Minister long after her victory to purge the dissident, as she no doubt privately describes the right hon. Member for Cambridgeshire, South-East (Mr. Pym). He lost his job as Foreign Secretary and one wonders how long the Secretaries of State for Northern Ireland and for Energy will last in their jobs. The Prime Minister has never liked critics in her ranks, certainly not around the Cabinet table. She seems to like the hero worship and hysteria of the faithful, the party rallies and conferences and the standing ovations which always remind me of Communist party congresses in the Soviet Union. The notorious rally at Wembley represented in many respects Thatcherite Toryism.
If the economy continues to decline and manufacturing industry continues to suffer as it has over the past few years, there is no doubt that unemployment will carry on rising. The Conservatives may find a far more unfavourable climate at the next election, when all the work of Saatchi and Saatchi may not be able to help them.
I have grave doubts about whether we shall be able to persuade the Government to take the necessary steps to improve this country's prospects. If manufacturing industry in the west midlands and elsewhere is to be able to recover and if more factories and plants are not to close, putting more people in the west midlands and the black country on the dole queues, we shall need a more competitive exchange rate and at least some protection against the high import penetration of British markets.
The west midlands has probably suffered more than any other region in the past four years. In my own local travel-to-work area, 18 per cent. of the work force are registered as unemployed. The regional rate is 15 or 16 per cent. Behind those statistics are the tragedies of so many people—youngsters, married couples and heads of households—who have to live on unemployment pay and supplementary benefit. Their chances of finding work—any work—are becoming increasingly remote. The fact that we did not succeed at the last election does not alter in any way our argument that there must be alternative policies for running the economy.
There can be no justification for a situation —certainly in my area and I am sure in many other parts of the country—in which once a person in his 50s or late 40s is made redundant, he will find, on the basis of existing policies, that he can never work again. That is throwing a human being on the scrap heap and saying to someone, "Give up hope. All you will live on is unemployment benefit and supplementary benefit, and the chance of getting a job will become increasingly difficult." The Labour party has a duty to speak and argue against such policies. The fact that the Tories now have such a large majority does not undermine the credibility of the argument that we are trying to get across here and in the country.
In this moment of jubilation on the Conservative Benches they should—my right hon. and hon. Friends understand the position well — understand the despair, bitterness and alienation felt by many young people, particulary in inner city areas. These are areas where, once one leaves school, one knows that the possibility of getting a job is almost nil. I stress the word "alienation". My right hon. Friend the Member for Glasgow, Rutherglen (Mr. Mackenzie) was right. Many of these young people, white and black, do not blame one political party. The difficulty is that they will come to blame the whole parliamentary system. They will become so alienated and bitter that they will not identify with our parliamentary and democratic process. In 1979 and 1980, before the disturbances, the Government were told that they were playing with fire in not taking action to change the conditions that I have described, and that they must provide work opportunities for these young people in inner city areas who face such terrible circumstances.
It is most unfortunate that the Prime Minister today confirmed what has been hinted in the general election campaign, that unemployment benefit will not necessarily be increased in line with inflation. The House will know that there was quite a struggle in the last Parliament over the 5 per cent. abatement. Unemployment benefit was to be taxed but that could not be done at once for administrative reasons, so 5 per cent. was taken off unemployment benefit. When unemployment benefit was duly subjected to income tax a year later, that 5 per cent. was not restored, and it will not be restored until November this year.
As a result of that 5 per cent. abatement, those who have been made redundant and are living on the most limited incomes have often been made subject to double taxation. I can see no possible justification at a time when we know that it is so difficult to find work, for saying what the Prime Minister did today — that unemployment benefit will not necessarily be increased in line with inflation. In a sense, it is putting the blame for unemployment on the victims of economic recession, and many of us would describe them as victims of the Government's economic policies. Why punish them? What have they done? If a person has worked for a number of years in one job, as is often the case in my constituency, and finds that he has been made redundant and cannot get another job, why should he be discriminated against to the extent that his unemployment benefit is not increased in line with inflation? Again, one has to emphasise that we are dealing with those on the most limited incomes.
Some Conservative Members seem to feel that the unemployed have only themselves to blame. If only they would go out and seek work, as was implied by the Secretary of State for Employment two years ago, they would find employment. However, things are not like that. My right hon. Friend the Member for Rutherglen described the position in Scotland. He knows only too well that the unemployed are not likely to find work there, the same is true in the west midlands and many other parts of the country. Therefore, the duty and responsibility of Labour Members is to expose the policies of the Government and the way in which the unemployed will be penalised and their limited living standards further undermined as a result of Government policy.
I am also concerned because pensioners are not likely to recieve a proper increase in November. As my right hon. Friend the Leader of the Opposition said, the formula has been calculated so that the increase that pensioners and other people receiving benefits will receive in November will not be in line with the then rate of inflation. The calculations were changed to fiddle the pension, and to ensure that retirement pensioners in particular do not receive the increase to which they are entitled.
We learned today that the mortgage interest rate has been increased by 1·25 per cent. I wonder what would have been the effect on the election result had the Building Societies Association recommended such an increase during the campaign. Are we really to believe that all this has come as a surprise to the building societies? Inevitably, the question will be raised—why now? Why not during the election campaign? Perhaps there was some pressure—who knows?—but the fact is that barely two weeks after the election results have been declared, a large number of people, the very sort of people that Conservative Members always talk about — owner-occupiers—will face a hefty increase as a result of the decision taken today by the Building Societies Association.
The Labour Party is in favour of owner-occupation. One of the lies in the recent election campaign was that somehow or the other the Labour Party was opposed to owner-occupation. However, it was the Labour Government in the late 1960s that introduced the option mortgage scheme, which made it easier for many people on limited incomes to become owner-occupiers. I do not know why the hon. Member for Ealing, North (Mr. Greenway) is shaking his head. What I have said is a fact.
What is more, also in the late 1960s, the Labour Goverment took action over leasehold reform, which resulted in many owner-occupiers having greater security and protection in their homes. Let the position be clear —my party favours, and always has favoured, owner-occupation and giving the greatest opportunity for people to become owner-occupiers.
There is reference in the Gracious Speech to extending the rights of public sector tenants to buy their own homes. One of the questions asked in the last Parliament—it was a reasonable question that has not been answered—is why, if it is right and almost a principle that council tenants should be able to buy their own homes, is this not extended to private tenants? The answer is the obvious one that it is not the job of the Tory Government to offend private landlords and property companies.
However, if one argues, as the Conservative Party has beeen arguing in the past four years for taking action on the lines that we know, of Acts of Parliament and the rest, to force local authorities to sell, then we shall keep returning to the rights of private tenants. It must be said that, whatever may be the arguments for and against selling rented accommodation, private tenants need greater protection than council tenants. Some are undoubtedly exploited by landlords, and many would welcome the opportunity to buy their rented accommodation. It could be said that they have a greater need than council tenants, but we know that no action to provide such rights to private tenants is likely to come from this Government.
It is interesting to note that there is no reference in the Gracious Speech to house building. Council house building is at its lowest since the 1920s. In my own borough in Walsall there have been no new contracts for council house building since 1979. It is such a unique sight to see council dwellings being built that perhaps such construction should be photographed. It is extremely rare to see council house building in any part of the country. There are many families desperately in need of accommodation who, even if the mortgage rate had not been raised today, would not be able to buy their own accommodation. The Government do not recognise that there remain a large number of people whose only hope of getting decent, adequate accommodation is to be rehoused by the local authority.
In the last Parliament, I was a member of the Select Committee on the Environment which said that on the basis of existing policies there was likely to be a shortfall of 350,000 dwellings of all kinds by the mid 1980s. As my right hon. Friend the Member for Rutherglen rightly said, many people now unemployed trained for work in the construction trades and could build and improve the accommodation which is required so desperately. If existing rented accommodation is to continue to be sold off and very little new council accommodation is to be built, we seem to be heading for a formidable housing crisis.
Many people come to see me at my surgeries over housing needs and others write explaining their position. As a result I contact the local authority. But at the end of the day the extent to which the local authority can assist depends on the amount of new accommodation that it can build.
I have referred to some of the problems confronting the country. The matters which Opposition Members are arguing about will remain important issues. Mass unemployment, industrial and economic decline, the housing crisis and the rest will not go away, despite the Tory victory on 9 June. The responsibility of Labour party members in and out of Parliament is to continue to argue our case and to persuade enough people that our policies are sane policies and to work and organise ourselves so that when the next general election comes we have a very different result—a Labour Government with a working majority in the House of Commons.