Unemployment

Opposition Day – in the House of Commons at 3:50 pm on 8th December 1992.

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Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons 3:50 pm, 8th December 1992

I must tell the House that t have selected the amendment standing in the name of the Prime Minister.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions 3:52 pm, 8th December 1992

I beg to move, That this House deplores the rising tide of unemployment with its intolerable cost to the British people; notes with concern the high level of redundancies in British manufacturing industry, the falling level of job vacancies, and the steep increase in the number of long-term unemployed; condemns the Government's Autumn Statement for its total failure to tackle the jobs crisis at a time when unemployment in Britain is rising faster than anywhere else in the European Community and is forecast to rise above 3 million once again; regrets the continued neglect of training and investment in skills which are essential to the modern economy; and further condemns the Government for squandering the opportunities of the British Presidency to develop a strategy for growth and employment for the whole of the European Community. In plain language, in Britain today more than 4 million people are out of work. That is the real figure reflecting what is really happening to real people in the hard, real world of Britain today—a Britain in which 20 million working days are lost every week through unemployment. What a waste!

The Government do not publish the real figures. Instead, every month they churn out the official figures, reduced now by no fewer than 30 successive statistical fiddles. That shoddy process may reduce the embarrassment of Tory Ministers, but it does not reduce the job queues or the pain of unemployment.

Even if we take the Government's own figures, the rising tide of unemployment is there for all to see, to feel and to fear. Last month, there were 2,868,000 of our fellow citizens officially out of work. More than 30 unemployed people were chasing every job vacancy, with no fewer than 70 people chasing every job vacancy in London. Almost 1 million people had been out of work for more than a year. Some quarter of a million of the people out of work were young people who face the worst job prospects in our country's history. As we all know, there is worse to come. Parts of the country that once seemed almost immune to unemployment are now suffering as badly as the worst.

After the job losses of the past two years, there are now fewer than 4·5 million people employed in manufacturing industry in Britain. Just 4·5 million people are left making things in a country with a population of 57 million. However, the Government do not seem to care. For years, they have been prepared to let British industry be wiped out, in the fond belief that the people of Britain could earn a living by selling one another hamburgers and insurance policies. Even the hamburger joints and the insurance companies are in trouble now.

Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield

Will the hon. Gentleman give way?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

No, not at the moment.

The Tories keep saying that if an industry is not paying its way, it should be closed down. It is a good job for us that the rest of the world does not think like that, because, under the Tories, Britain is not paying its way. By the standards that the Tories have set, the Bundesbank would be sending in the brokers' men.

The Tories used to claim that the factories that were closing were in rust-bucket industries which were bound to close. There was some truth in that, but it is not true any more. The 500,000 manufacturing jobs that have gone in the past two years are mainly from modern, high-tech industries with highly skilled work forces—the industries of the future if we are to have an industrial future.

For far too long, far too many people have been without a job. When one loses one's job, one loses one's income and becomes dependent on benefits, if one is entitled to them. However, people who lose their jobs do not lose just their money. They can also lose their self-respect, sense of worth and purpose in life. People without a job are beset by an awful feeling that they no longer matter. Unemployment can lead to the break-up of marriages and to separation, divorce and domestic violence.

However, the harm caused by unemployment does not stop there. Unemployment damages the health of the jobless and their families. If one is out of a job one's mental and physical health deteriorates. Unemployment does not just make people ill. In plain English, unemployment kills and maims. It kills mainly by cancer, suicide, accidents and violence. For a middle-aged man to lose his job doubles his chances of dying in the next 10 years. Unemployment does not just kill the jobless it kills their wives, husbands and children—born and unborn. What a wicked waste.

The cost of unemployment is not just borne by the jobless and their families. The Secretary of State admitted recently that it costs the taxpayer £9,000 a year to keep someone out of work. That is £9,000 in benefits paid out and tax not taken it. Even according to the official figures, the present mass unemployment is costing taxpayers £25 billion this year. That is equal to more than £1,000 for every family in the land. What a waste.

It does not end there. When people are out of work, they are not producing anything. Back at work, they could produce goods and services which would add to the country's wealth. if just the 10 per cent. who are officially jobless were back at work, they would produce goods and services worth more than £50 billion. That is equal to more than £2,000 for every family in the land. Instead, they are doing nothing. What a waste.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

No, certainly not to the hon. Gentleman.

Even by the crudest and coldest Treasury standards of accountancy, and making no allowance for human misery, mass unemployment is costing a fortune. The cost of mass unemployment in terms of lost production——

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

No, not at the moment.

The cost of mass unemployment in terms of lost production and loss to the taxpayer is therefore equal to more than £3,000 for every family in Britain. That is surely an intolerable cost.

Photo of Mr Tony Marlow Mr Tony Marlow , Northampton North

The hon. Gentleman has described a dire and concerning situation, and we share his concern. Why is the impression given that his party, given those circumstances, would seek to make matters worse by embracing the social chapter and increasing the burden on industry and also, no doubt, by increasing taxation which would also increase the burden on industry and make the level of unemployment much worse?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

If the hon. Gentleman bides his time, I will come to those matters.

The cost of unemployment does not end with those costs. The damage to health places extra strain on the national health service. Domestic violence and family breakdown place extra demands on social services, the police and the courts. By breaking up families, unemployment adds to homelessness. By giving young people nothing to do, it leads to crime. That does not mean that not having a job automatically makes someone a criminal. Unemployment does not provide an excuse for theft or violence.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

No, I will not give way until I have finished making my point.

Mass youth unemployment means the breakdown of the ties that bind society together. Unemployment opens a gap between the generations. It creates a gulf between the dispossessed and those with possessions. With no honest way to earn a living, unemployed young people are exposed to the temptations of a life of crime which can provide more money and excitement than respectable society can offer.

Photo of George Howarth George Howarth Shadow Spokesperson (Environment, Food and Rural Affairs)

While my hon. Friend is on the subject of the relationship between crime and unemployment, will he comment on Clarke Foods which recently closed down Lyons Maid in my constituency? Perhaps he will refer specifically to allegations that have been made of insider dealing, fraud and possible gun-running by the proprietors of that company. Does not that example contrast sharply with the risks that young people take? The people who own companies such as Clarke Foods are often dodgy.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I do not have such detailed information about the owners of Clarke Foods. However, I believe that the proposed closure—throwing people out of work and reducing their pay—is a crime against the people of Knowsley.

Photo of Jacqui Lait Jacqui Lait , Hastings and Rye

I am intrigued by the hon. Gentleman's belief that increased unemployment among young people will result in a higher burglary or crime rate. Is it not true that, although we had high employment, the crime rate continued to increase at a rate of which none of us would approve? Is the hon. Gentleman aware that in Sussex, which has high unemployment at present, the burglary rate has gone down?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

The fact is that we have had mass unemployment in many parts of the country since this Government took office in 1979. We have had rising crime, year in and year out. The greatest increase in the crime rate has occurred in the areas with the highest unemployment. As my hon. Friends will confirm, large and small pockets of disenchantment are developing all over Britain.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

No.

Those pockets of disenchantment are filled with young people who are alienated from society. Those young people share fewer of our values, and are less and less convinced that anyone cares for them. They are prey to exploitation by the evil right-wing forces of prejudice, hatred and unreason, which we have already seen unleashed elsewhere in Europe.

What do the Government have to offer in response to all of that? Nothing, or next to nothing. The Secretary of State expresses her concern and sympathy. She talks about counselling and training. But she knows that her Department's training budget per unemployed person is less than half of what it was just three short years ago. Counselling and training and concern and sympathy may ease the pain of unemployment, but they are not enough. The only cure for unemployment is a job. The Secretary of State is doing nothing about jobs.

The autumn statement was so feeble that the Secretary of State and her colleagues have refused to estimate how many jobs it will create. I think that the reason for that refusal is that any jobs created would certainly be outpaced by the Government-induced job destruction which is taking place at the same time. Neither the Secretary of State nor the Government has anything to offer.

Photo of Mr Anthony Coombs Mr Anthony Coombs , Wyre Forest

Does the hon. Gentleman agree that one of the best ways for young people to find jobs is through youth training and that the Government have probably the largest youth training programme in Europe? Does he accept that, for other people, employment action is important in providing training? Will he tell the House why the Transport and General Workers Union—which sponsors several Front-Bench Opposition Members, one of whom is sitting next to him—has said consistently that it will boycott those programmes?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

The hon. Gentleman would do well to consider the true record of the various training programmes. Let us take employment training——

Photo of Mr Anthony Coombs Mr Anthony Coombs , Wyre Forest

What about youth training?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I will come to youth training in a moment. Employment training was much vaunted until the Secretary of State herself denounced it recently and said that it needed to be replaced. I can see why she denounced it. Fewer than one in five of the people who go on employment training end up with a job. The figures show that people stand less chance of finding a job if they have been on employment training than if they have not. That is scarcely a success rate. About one in four of those who go on youth training do not get a job and 65 per cent. do not obtain a qualification. The scheme is an effort, but it is not good enough.

What has the Secretary of State to offer anyone in Britain? What does she have to offer Andy Cartlidge? He is one of 325 people who lost their job at Rolls-Royce in Nuneaton. He is a trained craftsman in his late 20s. He worked in that factory using state-of-the-art equipment to work sophisticated metals to produce discs and spacers for aero engine turbines. He is out of a job now. He is one of the most highly skilled people in Britain. He does not need training; he needs a job.

Several Hon. Members:

rose——

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I shall press on for the moment because other hon. Members wish to speak.

Photo of Mr Philip Oppenheim Mr Philip Oppenheim , Amber Valley

On a point of order, Madam Speaker. Is it in order for an Opposition spokesman to say consistently that he will give way to me and keep a humble Back-Bencher in a state of excitement and anticipation and then to give way to everyone else?

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

That is not a point of order for me. I would not describe the hon. Gentleman as a humble Back-Bencher by any means.

Photo of Gwyneth Dunwoody Gwyneth Dunwoody , Crewe and Nantwich

I hope that my hon. Friend will be happy if I do not hit the note of petulance that is being struck on the Conservative Benches. This is a serious debate. Will my hon. Friend consider that one way in which the Government could protest about unemployment and do something to redeem their position would be to abandon the Bill to privatise British Rail? They would thereby protect 1,500 jobs in my constituency, where 5,000 jobs have already been lost in manufacturing.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I entirely agree with the point that my hon. Friend makes. Indeed, I shall deal with that matter later in my speech, if I am allowed to reach it.

What does the Secretary of State have to say to Linda Wilkinson of York? Compulsory competitive tendering left her with the choice of giving up her job cooking school dinners at English Martyrs school in York or accepting a £600 cut in pay and the loss of statutory sick pay and other benefits. Is that the choice that the Tories offer to hard-working women in Britain, where the Minister responsible for equal opportunities is also the Secretary of State for Employment?

What does the Secretary of State have to offer the unemployed in Basildon. where unemployment has doubled in the past two years? People in Basildon have lost jobs recently at Yardley Perfumes, Northern Telecoms and even, dare I say it, Access. Basildon people lost jobs when Marconi in Chelmsford laid off hundreds. The jobcentre in Basildon recently advertised a job for a clerical assistant with the police force. More than 500 people applied for that job. What does the Secretary of State have to say to the 500-odd people who did not get that one job?

Photo of Mr John Sykes Mr John Sykes , Scarborough

Is the hon. Gentleman aware that in May this year the hon. Member for Kingston upon Hull, East (Mr. Prescott) admitted the devastating effect that the minimum wage would have on jobs and said that "any silly fool" knew that? Does the hon. Gentleman agree?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

If the hon. Gentleman had read out what my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) actually said, I should be able to agree, because it was true. As the hon. Gentleman did not read it out, I cannot agree with him.

Those are just a few from millions of examples.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

No, I shall not give way to the riff-raff at the back.

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

On a point of order, Madam Speaker. If the hon. Gentleman will not give way to a humble Back Bencher, why will he not give way to an arrogant Back Bencher who at least knows what he is talking about?

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

That is a point of frustration and not a point of order.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

Perhaps I should explain that, when many people have no jobs, I am reluctant to give way to Tory Back Benchers who have legions of jobs between them.

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

I hope that it is a point of order with which I can deal. If it is not, I shall not deal leniently with the hon. Gentleman.

Photo of Mr Philip Oppenheim Mr Philip Oppenheim , Amber Valley

Is it in order for the hon. Member for Holborn and St. Pancras (Mr. Dobson) to make a claim about the "legions of jobs" that I supposedly have when my only job is in this House?

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

Order. Let us have some order in the House this afternoon. The hon. Member for Amber Valley (Mr. Oppenheim) has explained his position and it is recorded.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

The examples that I gave are just a few of millions which show what is happening, but unemployment also affects people who are still at work. Under this Government most people in work think that they are lucky to have a job. Their workplace is filled with rumours of redundancy and they do not fancy their chances of finding a new job. If they are made redundant they are reluctant to pursue new jobs because they fear the insecurity that goes with being the last in—they may turn out to be the first out. They are frightened to speak out at work for fear of the sack, and they are frightened to borrow or to spend because they rightly fear another rainy day.

That fearful and aquiescent work force may appeal to the Victorian values of the Tories, but it is no role for fellow citizens in a democracy.

Photo of Mr Ralph Howell Mr Ralph Howell , North Norfolk

Will the hon. Gentleman explain what the Opposition would do to solve the problem? They are very good at telling us what we have done wrong. He has already said that unemployment is terribly wasteful, and I agree. I am sure that he agrees that most unemployed people desperately want to work. Does he agree that we should set up a voluntary workfare system, because thousands of unemployed people would accept such work if they had the chance to do so? Does he recognise that the Secretary of State has gone some way towards agreeing with my views by agreeing to set up a pilot workfare scheme?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

My general view is that if there is work to be done and people to do it, they should be paid the rate for the job; workfare would not then be necessary.

What do people have to show for all the pain that they have suffered? Tory apologists have argued for years that unemployment is the price that we must pay for economic advance—that it is the medicine to cure our economic ills. The first thing to note is that those who prescribe unemployment as a medicine always fight shy of taking a bracing draught of it themselves.

Secondly, that argument is total economic rubbish. After more than thirteen and a half years of Tory Governments doling out doses of unemployment by the bucketful, what have we got? Britain is economically weaker than it has ever been; our share of' the world trade in manufactures has fallen; the trade surplus that the Tories inherited has been turned in 10 successive years of deficit and is heading for an official total of £14 billion this year; Government borrowing is set to hit record levels; the gap between rich and poor is the widest that it has been this century; investment is down; and bankruptcies are up. On top of all that, the Government have allowed Britain—the only country in western Europe with substantial reserves of coal, oil and natural gas—to fritter away our fuel trade surplus and to become a net importer of fuel again.

That brings me to the failure of Tory Ministers for which they will surely never be forgiven. I refer to the way in which they have squandered the advantage of North sea oil and gas. Handled properly, the takings from the North sea could have been used to transform Britain, getting us ready for the challenges of the new century, which I remind Conservatives Members is only seven short years away—wealth for Britain, protection for the balance of trade, capital to invest in our future and massive revenues for the Government.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

The hon. Gentleman has said much about investment and earlier he spoke of a young man who had worked for Rolls-Royce. Is he aware that the advances of modern technology have meant that companies such as Rolls-Royce can purchase machines that can do the jobs of 20 or 30 men over a 24-hour period? Does he appreciate that problem, which is also a problem of investment?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I had intended to deal with that issue later. Rolls-Royce, one of our blue chip companies which should be putting a great deal of money into the future, is investing less in research now that it is privatised than it invested when it was in public ownership.

Over the last thirteen and a half years, the Tories' revenues from the North sea have totalled £110 billion. What do we have to show for it? Nothing. It has all been squandered on financing unemployment, on tax concessions for the very rich and on trying to ease the pain of the poll tax. Every penny has gone.

A far-sighted Government would have used that money to invest in research and development, in new plant and equipment, in education and training for our young people and on retraining our older people. But the Government did not do that. They were too busy pushing through tax concessions for, for example, the Duke of Westminster, to whom, if we understand theEvening Standard aright. the hon. Member for Teignbridge (Mr. Nicholls) is giving money to help him support his money-raising activities from his estates.

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

On a point of order, Madam Speaker. There has for long been a tradition in the House that if an occupant of the Front Bench refers specifically to another hon. Member, as the hon. Member for Holborn and St. Pancras (Mr. Dobson) just has, he should gives way. The conventions that apply to Back Benchers should apply to Front Benchers.

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

The House knows that it is a convention, but it is entirely up to the right hon. or hon. Member who has the Floor whether or not he gives way.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

If the impatient and well-paid hon. Member for Teignbridge had waited for me to finish another sentence, he would know that I had intended to give way to him.

The Tories have also spent their time giving subsidies to foreign property speculators. I cannot believe that giving £370 million in subsidies to the Canadian developers of Canary Wharf was a good investment for the rest of Britain.

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

Does the hon. Gentleman believe that any prospective employer listening to his contribution to today's debate will be encouraged to provide job opportunities, especially as the hon. Gentleman is on record as recently as September as describing employers as stinking, lousy, thieving, incompetent scum"? That has been the nature of the hon. Gentleman's contribution today.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

My remarks in September appear, like Banquo's ghost, every time I come into the Chamber. I will make the position clear. I withdraw not one word of what I said, remembering that I addressed those words to those who pay poverty level wages and pay themselves a fortune on the backs of those poverty level workers, so they are exactly as I described them, which is why I do not withdraw a word of what I said.

Instead of using the heaven-sent opportunity of North sea oil to lift the skills and qualities of our people——

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I will definitely not give way to the hon. Gentleman.

Those revenues should have been used to lift the skills and qualities of our people to levels as high as any in the world. Instead, the Government have given up any idea of putting our people in a position where they can compete with the best. They have abandoned the idea of competing with German industry through innovation, quality and skill. They have thrown in the towel. Faced with the choice of Britain as a science park or a sweat shop, the Tories have opted for the sweat shop. They say that our people can now only compete if they work long hours for low wages in poor conditions.

When it comes to photo opportunities at international conferences, Tory Ministers are pictured as part of the Group of Seven developed countries, but when it comes to economic ambition the same Tories see our country as being in a trade war with the third world. That is why they fight against every effort to improve working conditions and reject the social chapter. They know that while they are in charge Britain cannot compete on quality with the best; under the Tories, we are reduced to competing on cost with the worst. Why else would the Prime Minister think that our miners should compete with coal produced by child labour in Colombia?

Photo of Oliver Heald Oliver Heald , Hertfordshire North

How can the hon. Gentleman describe British industry in those derogatory terms when Britain has six of the top 10 businesses in Europe competing with the best on quality?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

We do not say that it applies to every industry——

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

On a point of order, Madam Speaker. The hon. Gentleman referred to the use of child labour in Colombia to produce coal that is exported. That statement is absolutely untrue and I ask that he withdraw it.

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

Order. That is certainly not a point of order which the Chair of this House can resolve at this stage.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

As the president of the Colombian mining industry says that there is child labour in Colombia. I am willing to go along with that—[HON. MEMBERS: "Domestic coal."] Let us see the Tory vision of the future: it is all right if the children are producing domestic coal. That is absolutely brilliant.

What should the Government do, apart from quieten down some of their Back Benchers? First, they should act to stop the rot. More than 300,000 jobs are presently on the line as a direct result of Government policies. More than 100,000 jobs are threatened by the Government's pit closure programme, partly induced by the import of child-labour coal from Colombia. Another 100,000 jobs are likely to disappear from local councils as a result of the new grant settlement. Dinner ladies, road sweepers and home helps will all be thrown on the scrap heap. The national health service could lose as many as 25,000 jobs as a result of the cuts now being pushed through. The Government could stop all that today.

Jobs in the Post Office, shipbuilding and defence supplies have all been marked to go by the Government. They could prevent that by abandoning Post Office privatisation, phasing their warship orders to help the shipyards, and buying British equipment and ammunition. It was bad enough to sell arms to Iraq, but if the Royal Ordnance closures go through, we could end up buying arms from Iraq. North sea revenues could have been used to diversify from defence to civilian production, drawing on the supremely skilled work forces of many of our defence manufacturers. Instead, the Government have let them go. Immediate Government action could save all those jobs.

However, it cannot stop there. In times like these, the Government have a duty to reduce unemployment by creating jobs. The Tories claim that Governments cannot create jobs but can only destroy them. I accept that that is true of the present Tory Government but they should not generalise from the particular. The Government have destroyed thousands of jobs, but that does not mean that Governments cannot create them.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

No, not at the moment.

Governments can and do create jobs directly through investment and intervening to provide financial and other help for private investors, and indirectly by raising aggregate demand for goods and services. All those approaches would create jobs and the Government should adopt them before the roll call of the jobless becomes endless.

Once again, I call on the Government to halt the 300,000 job losses that will be created by direct Government action. As we have said time and again, the Government should begin to realise the takings from the sale of council houses for investment in new housing. As my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) said, the Government should abandon rail privatisation and, instead, start a major investment programme in the railway system to give every part of Britain fast, direct and reliable connections to the rest of Europe through the channel tunnel.

The Government should release funds to improve the London underground and local railway systems. They should put seed corn investment into science parks and other industrial developments associated with research and higher education. They should invest more in effective, high-quality skill training rather than the ineffective job-chasing schemes that dominate their policies at present. Those proposals will start to stop the rot, but even bolder long-term measures are required.

Photo of Mr Eddie Loyden Mr Eddie Loyden , Liverpool, Garston

My hon. Friend has referred to the shipyards. Is it not a fact that the Government could make great inroads in reducing unemployment at the country's various ports if they decided to use "Options for Change" to build the badly needed merchant ships? I think that all hon. Members recognise the need for a merchant fleet to put shipyard workers back to work and our seamen back on ships that they can sail.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

My hon. Friend raises some good points, which are relevant in the present circumstances on Merseyside. I am sure that other of my hon. Friends will wish to press the matter of Cammell Laird and other yards.

I believe that the first requirement of bold measures is to return full employment to its proper place in the economic and political ambitions of both Britain and Europe. Nobody pretends that full employment can be achieved immediately, but it will never be achieved by accident. First, we need to decide that we want full employment. Only after we have decided the destination can we begin to plan the journey and to work out the route.

Full employment cannot be achieved in Britain alone; it must also be put back on the agenda of the European Community. At present, whichever figure we use, we find that more than 16 million people are officially out of work in the Community, which is shameful and presents a threat to the cohesion of the European Community. Some people cannot understand why Denmark voted no. They could do worse than look at the unemployment figures. When Denmark joined the Community in 1972 there were just 23,000 Danes out of work—now the figure exceeds 316,000. A European commitment to get those people back to work would, I suspect, work wonders with Danish public opinion.

Photo of Mr Tony Marlow Mr Tony Marlow , Northampton North

What are the figures here in the United Kingdom?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

The increase is not as bad.

Mass unempoyment does more than threaten the cohesion of the Community—it threatens democracy. The unemployed young have always been a principal recruiting ground of the racist, anti-Semitic, fascist, right-wing parties in Europe. With the neo-fascists strutting around in Italy and murdering neo-nazis stomping around in Germany, and their counterparts reappearing in France and Spain, mass unemployment must be tackled now, Europewide.

All the democratic parties of Europe must address the problems of the unemployed in Europe before the unemployed transfer their loyalties, disillusionment and anger elsewhere. That is why getting Europe back to work should have been top of the agenda for the Edinburgh summit. Theological discussions about subsidiarity should have given way to practical plans to maintain and create jobs.

Photo of Angela Browning Angela Browning , Tiverton

I am sure that Members on both sides of the House share the hon. Gentleman's concern about unemployment throughout the European Community. Would he like to comment on the words of the Commissioner with responsibility for employment, Mrs. Vasso Papandreou, who only last week in this House expressed her views on how work and jobs would be created in the Europe of the future? She expressed some anxiety that investment in jobs involving what was described as too much capital investment—investment in manufacturing jobs—was not the way forward, and said that future jobs in Europe should be created in the service sector. I would not wish to denigrate that view, but it is certainly not the way in which the Government are approaching the problem. It is the socialist view of Europe——

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. I remind the hon. Lady that interventions should take the form of questions, not speeches.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I am certainly prepared to comment on that. Germany may he able to afford a slightly higher proportion of its economy being devoted to the service sector, because it starts with 12 per cent. more people in manufacturing jobs than the European average, whereas we are below the European average. We are the country that practically got rid of our manufacturing base. We were promised time and again that the service sector could take the strain. But the service sector is not taking the strain: the 4 million people who are out of work are taking the strain.

Photo of Mr Seamus Mallon Mr Seamus Mallon , Newry and Armagh

I note with great interest the correlation that the hon. Gentleman has drawn between violence in European countries and unemployment. The part of his jurisdiction in which I live has the highest unemployment in Europe. It is no coincidence that the three constituencies in Europe with the highest unemployment are represented by my hon. Friends the Members for Foyle (Mr. Hume), for Belfast, West (Dr. Hendron) and by me. Is it any surprise, therefore, that the correlation between violence and unemployment has demonstrated itself for the past 20 years in the north of Ireland?

I wish to pose a question and to ask the hon. Gentleman's advice. If there were three British constituencies—in England, Scotland and Wales—with the highest unemployment in Europe, would they not have been made disaster areas and been given special attention?

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

There may be something in what the hon. Gentleman says. The problems of Northern Ireland are not simple, and there are clear links between violence and unemployment. I am glad to hear him confirm the points that I have been trying to make, which have largely fallen on deaf Conservative ears.

What are needed now are bold and positive policies, not just to cut unemployment but to aim for full employment. Full employment works. It worked when the Secretary of State and I started work in the early 1960s, when unemployment was low and there was almost one vacancy for every person seeking a job. That was a good time to go into the work force—a great deal better than now. Full employment works and is good for everyone. It gets people off the dole queues; it gives them self respect. It gives school leavers a choice of jobs. It gives people the security to change jobs. Full employment allows people at work to say what they think. It saves the taxpayer a fortune. It creates more wealth; it makes possible a better life for all our people.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I have given way an enormous number of times.

To bring about full employment will not be easy. Technological change, as I acknowledged, can take away jobs as well as create them. Therein lies another criticism of this Conservative Government. As Benjamin Disraeli, born in my constituency, said of Conservatism: it offers no redress for the present, and makes no preparation for the future. Faced with the changing nature of work, faced with the adjustments that society will have to make in response to these changes in work, the do-nothing Tory Government have given no thought to the problem and made no preparation for it. All, we understand, is to be left to market forces—and we cannot trust market forces.

We need to look in future to the capacity and skills of our people and measure them against the demands of our economy and try to match them. If we go about it the right way we can match them to suit the needs of the work force as well as the needs of the economy.

Properly organised, most people in future could be able to choose when to work and what hours each day, what days in a week, what weeks in a year and what years in a lifetime. That could transform, particularly, the position of women at work and so transform society.

With more and more powerful machines to do more and more of the work, we shall need to share out the work that needs to be done by men and women and the rewards that go with it. We in the Labour party reject the untrammelled free market approach to the future of work. We need only look at what is happening today. This very day we have, at the same time, 4 million people on the dole while millions of others are working far too long hours in circumstances that threaten their physical and mental well-being and clash with the needs of their families.

We need to invest to make this change, but we need to decide that the Government has a role in this change. Those in the Conservative party who reject the role of Governments in this change want things to go on as they are. The profits of our existing industries and the products of the hard work of their employees must be invested and reinvested in plant and equipment, in research and development, and in training for a better and more high-tech future. The people of our country want to see that investment and are entitled to see it. They have been sickened over the past few years by the way many company directors have lined their pockets with enormous salaries, share options and other perks, while at the same time laying off large parts of their skilled and loyal work forces and preaching for others the merits of frugality. The mass unemployment of recent times has rendered such behaviour totally unacceptable and likely to undermine the stability of our society.

What we need now is an end to the rising tide of unemployment and the unacceptable burden it places on the people of our country. We need a package of measures to get Britain and Europe back to work. As we approach the new century we need a long-term commitment to aim for full employment and a new approach to work which shares out its demands and rewards more fairly and effectively. Nothing less will do.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment 4:37 pm, 8th December 1992

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof: recognises the need for the United Kingdom economy to remain competitive at a time of world recession; rejects the job destroying policies of Her Majesty's Opposition including the national minimum wage; notes that the United Kingdom has the second highest proportion of its population in employment of any country in the European Community; congratulates the Government on the new opportunities afforded by the Autumn Statement; and welcomes the Government's new package of 1·5 million employment and training opportunities providing more help than ever before to help unemployed people get back into work.". There is one thing on which the hon. Member for Holborn and St. Pancras (Mr. Dobson) and I agree and that is about the importance of the subject under debate. Unemployment is a difficult and distressing experience for the individuals concerned, and for their families and for the communities in which they live. Of course, in a time of recession, the fear of losing a job is very real. All of us, on both sides of the House, understand that.

This afternoon I intend to set out what the Government are doing, first, to promote growth in the economy and in jobs—because lasting employment is created only in a sound economy—and, secondly, to help those who have lost their jobs to get back into work. Jobs are created by the initiatives and enterprise of businesses and of the individuals who work in them. It is clear, on this side of the House at least, that jobs can come only from the competitiveness, the efficiency and the earnings of our industry and commerce.

But the Government have a vital role to play. They need to ensure the right economic framework; and because people, if they become unemployed or face redundancy, are nervous and anxious, they need to know that there is genuine and effective help at hand.

Photo of Gwyneth Dunwoody Gwyneth Dunwoody , Crewe and Nantwich

Does not the Secretary of State accept that Government privatisation policies are costing hundreds and thousands of jobs and that to privatise British Rail will not only destroy the existing integrated service but will throw many hundreds of people on to the dole quite unnecessarily?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

Of course I do not accept the hon. Lady's premise. This country needs a proper infrastructure of efficient railway services and communications. If that can be achieved better by privatisation, so it should be. That will stimulate the economy and the creation of real jobs.

Before I describe the Government measures provided for those who are unemployed or who face redundancy, I will remind the House of certain points that Opposition Members like to ignore. They like to ignore the fact that there is a world recession. They like to maintain, in their unremitting efforts to talk Britain down, that ours is the only country in the world to be in recession; the only country in the world to be affected by unemployment. Nothing could be further from the truth.

Photo of Ronnie Campbell Ronnie Campbell , Blyth Valley

A booklet circulated among all the high commissions and embassies throughout the world entitled "Invest in Britain" states that Britain's labour force is the cheapest in the world.—cheaper than those of France, Germany, and America. It states also that trade unions in Britain have no legal rights. I am trying to think of the many other things that the booklet said, and I wish that I had that document with me—[Laughter.] Conservative Members should not laugh, because the Government produced the booklet. Has the Secretary of State read it?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

No, I have not—and it is a pity that the hon. Gentleman cannot quote from it accurately. I am sure that he is grateful that many jobs have been created in his constituency by inward investment.

Let us consider what is happening elsewhere in the world—for example, in Japan and Germany, for so long the acknowledged economic leaders of the industrialised world. As they struggle to emerge from recession, their economies remain sluggish. Last year, industrial output fell more in both Japan and Germany than in the United Kingdom. The German institutes—known more familiarly as the five wise men—predict no growth at all in the German economy in 1993. Recession continues in Sweden, Switzerland, and Finland. What of north America and the Pacific rim countries? They have shared the same problems.

Manufacturing jobs in the major economies have declined since the mid-1960s, and recent strains on the European monetary system and exchange rate mechanism show the seriousness of those economic problems in Europe. Every country in the ERM has been affected and nearly every currency, including the French franc. The Nordic countries, whose links to the ERM do not involve membership, have also been affected.

Last week in Brussels I chaired the Social Affairs Council, and I do have to say that the Opposition motion on the EC excels itself even for an Opposition motion, in being out of date, irrelevant, and wrong. For the very first time, employment Ministers of the Community spent time discussing the problems of people without jobs—and this entirely as a result of the United Kingdom presidency's employment resolution initiative. All the member states supported that initiative and the practical measures to help that it produced.

There is shared anxiety about unemployment across the EC—as well there might be, because in Spain and Ireland, unemployment is more than 17 per cent., in France unemployment among young people is 22 per cent. And even Germany now faces the prospect of rapidly rising unemployment—up by 54,000 in November alone.

Photo of Mr David Alton Mr David Alton , Liverpool Mossley Hill

Does not the Secretary of State accept, in making her international comparisons, that, although the recession is deep and worldwide, other countries have responded differently? In Germany, for example, billions of deutschmarks have been invested in the coal mining industry to try to save jobs, and infrastructure investment is being made in many of the other countries that the right hon. Lady mentioned. Does she not think that, in trying to find a way forward, it would be worthwhile looking at the responses made by other countries?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

That is precisely what took place in the Social Affairs Council. I am sure that the hon. Gentleman would be interested to learn that this very day the Belgian employment Minister is in our country to learn how we cope with the unemployed.

The hon. Member for Holborn and St. Pancras ignores the fact that other countries are affected as we are. In common with the right hon. and learned Member for Monklands, East (Mr. Smith) and the hon. Member for Dunfermline, East (Mr. Brown), the hon. Member for Holborn and St. Pancras never loses an opportunity to talk Britain down. He ought to know that the United Kingdom cannot insulate itself from the effects of world slowdown, and he should support Government action to deal with those problems.

The hon. Gentleman, predictably, is entirely blind to those positive aspects of our economy that mean that we are ready to benefit from recovery, and are in a better shape than many of our competitors. He ignores those positive facts because Government policy has achieved them. Those achievements include the lowest interest rates in Europe; inflation under control and, at 3·6 per cent., at a level comparable to our major competitors and below the EC average; producer price inflation at its lowest since 1969; business taxation at the lowest in the G7 and EC countries; welcome signs of moderation in pay settlements—underlying earnings grew by 5·5 per cent. last year, the lowest for 25 years; unit costs well under control; retail sales continuing on a rising trend; new car sales in October rose by more than 8 per cent., and, total consumer spending rose in the second quarter of 1992 by 0·5 per cent.—the first increase since recession began; a competitive pound, which gives growing opportunities to exporters; rapidly improving productivity; and an improvement in productivity made possible by the removal of burdens previously placed on industry by Governments and trade unions.

Photo of Mr Dennis Turner Mr Dennis Turner , Wolverhampton South East

Does the Secretary of State accept that the people whom I represent in the black country always seek to be positive and are very resilient? However, my constituency has an unemployment rate of more than 20 per cent., and more than one third of our young people are out of work. My constituency is currently experiencing the closure of another company—the Rolls-Royce of the gas cooker industry, which has been producing cookers for 175 years. That plant is under the threat of closure, yet it has made profits and produces a top-line product. It has done everything that the company could have asked of its work force. Can you, as Secretary of State for Employment,——

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. I personally cannot do anything. Earlier in this debate, after an intervention by the hon. Member for Tiverton (Mrs. Browning), I drew attention to interventions being so long that they amounted to speeches rather than questions. The same applies to the hon. Gentleman.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

The hon. Gentleman obviously feels strongly about that key company in his constituency, but lower inflation and rising productivity must help his constituency, too. It is the framework that matters, not the extra burden that would—sadly, I must tell the hon. Gentleman—be imposed by a Labour Government, were one to be in power.

Most important of all, there has been an unparalleled improvement in the climate of industrial relations in this country. In the whole of last year, only 800,000 days were lost through strikes—the lowest figure for any calendar year since records began.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

If the hon. Gentleman wants a different figure, I shall be glad to give him one. In the 1970s, when Labour was in power, 13 million working days were lost each year through industrial action. Even in 1989, at the peak of the economic cycle, the number was four times lower. When it comes to strikes, this Government's achievement is an improvement on the record not only of Labour Governments but also of the party of the hon. Member for Liverpool, Mossley Hill (Mr. Alton) when it was last in power more than 100 years ago.

Photo of Mr Terry Lewis Mr Terry Lewis , Worsley

The Secretary of State talks about creating the right conditions and industrial relations. SmithKline Beecham, in my constituency, is closing a factory that it claims was profitable, had good industrial relations, and was an excellent part of that group's enterprise. Because the conditions have not been properly provided by the Government, they are now closing the factory and moving that manufacturing base somewhere else. What can the right hon. Lady say to that work force, who fulfilled every demand made upon them by the company and by the Government? That factory is on an estate where unemployment among 18 to 25-year-old males is 26 per cent.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

Companies such as the one described by the hon. Gentleman have to make commercial decisions, and presumably that is the reason for the decision that this company has made. But if that company were in the grip of industrial action, as it was when the hon. Gentleman's party was last in power, if business, commerce and industry were in the grip of the burdens on business that his party would impose upon it, millions more would be out of work.

Our deregulation policies have been a major factor behind the phenomenal growth of small firms. Between 1979 and 1989, their number increased to nearly 3 million. More than 1 million jobs were created between 1985 and 1989 by firms employing fewer than 20 people. And even in this time of economic difficulty many new businesses are starting. In 1991, there were more than 200,000 new value added tax registrations—a higher figure than that for most of the 1980s.

Despite recent rises in unemployment, the United Kingdom still has more people in work than any other country in the European Community except Denmark: 71 per cent. of the adult population are in employment, compared with just 65 per cent. in Germany and only 59 per cent. in France. What we need to maintain that is a flexible labour market, improved industrial relations and an economy structured to promote enterprise. These are the foundations of economic success.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

I hope that the right hon. Lady is not claiming some peculiar credit for this Government because there is a higher proportion of the population in the work force in Britain than anywhere else in Europe other than Denmark. That circumstance has prevailed as far back as records go, and certainly to the beginning of the 1960s. Surely she is not claiming credit for it.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

That, of course, is because Denmark has never had to endure the kind of burdens that would be imposed if the Labour party were in government

What we need for the recovery to take hold is confidence: we need confidence in business and confidence among consumers. Everything is in place except that one vital ingredient.

My right hon. Friend the Chancellor recognised that when he set out the Government's economic strategy in his autumn statement. He stated clearly the aims of the Government.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

The right hon. Lady must have misunderstood my question. I asked whether she would confirm to the House that Britain's second place in participation in the work force, for which she was claiming credit, has existed as far back as records have been maintained and since long before this Government took office.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

The hon. Gentleman must keep trying. The House knows very well that the sort of measures that he and his colleagues would impose on industry, business and commerce in this country would increase unemployment by millions. I shall go on to show that.

The aims of the autumn statement were to restore confidence, restart economic growth and, above all, create new jobs. The strategy for achieving these aims is clear: low inflation, tight control of public spending, competition and a vigorous supply-side policy. These are the policies which delivered growth and job creation on an unprecedented scale in the 1980s, and they will do so again in the 1990s.

My right hon. Friend also introduced measures aimed directly at job creation—measures aimed at boosting confidence and strengthening recovery; measures rightly targeted on those sections worst hit by recession, in particular construction and the car industry.

Photo of Eric Martlew Eric Martlew , Carlisle

Can the right hon. Lady tell the House when she expects unemployment to start to fall?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

The hon. Gentleman knows perfectly well that unemployment will begin to fall when the recovery begins, and the conditions for the recovery to begin are in place. What is needed is confidence, and confidence is boosted by the autumn statement.

Local authorities in England and Wales will be allowed to spend receipts from the sale of council houses. Priority will be given to spending on capital projects over pay increases for public sector workers. Some 20,000 empty houses will be taken off the market and all this should increase buoyancy in the housing market, create confidence and provide jobs. As one chief executive, Mr. Clive Thompson, has said: It's pretty much what the doctor ordered-tight public expenditure and priority to capital expenditure. Car tax is abolished and there are other measures for industry generally. First-year allowances for plant and machinery are increased from 25 per cent. to 40 per cent. There is a special initial allowance of 20 per cent. for industrial and agricultural buildings, which is important not just for manufacturing industry but also for rural areas, whose unemployment problems should not be overlooked.

We now have the prospect of a GATT deal. The Organisation for Economic Co-operation and Development has said that a successful Uruguay round agreement would boost world income by nearly $200 billion a year. That would add 1 per cent. to output in the European Community. The United Kingdom, with its record of improved competitiveness, is well placed to take advantage of a successful GATT deal. For exporters, whose prices are already highly competitive, the autumn statement measures have increased export credit cover. As business takes advantage of all these more favourable conditions, jobs will follow.

All forecasters now expect output to grow in 1993. My right hon. Friend the Chancellor predicts growth of around I per cent. Others, such as the National Institute of Economic and Social Research, are more optimistic and forecast growth at 2 per cent.

This is what some business leaders said after they heard the details of the autumn statement. Howard Davis, director general of the Confederation of British Industry, said: These measures … will rebuild industry's confidence in itself and in the Government. Sir David Lees, chairman of GKN and of the CBI economic affairs committee, said: My response is very favourable. We needed a whole package of measures and that's what we got … it will help to restore confidence. The Chancellor has listened to what industry said to him.

Photo of David Winnick David Winnick , Walsall North

I know that the right hon. Lady leads a very busy life, but does she take the opportunity to visit areas and communities in our country where unemployment is very high indeed? A high percentage of school leavers simply have no chance of finding a job and people in their middle age know that they are never likely to work again. Does she know about the deprivation, the poverty and the lack of hope in so many parts of our country, and does she not, as Secretary of State, feel ashamed that this is happening and that people take the view that there is no hope? That is the reason, as my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) said, why the extremists, the hate merchants, feel that they now have a fertile field to work in.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

It is an insult to the vast majority of unemployed people to imply that criminal behaviour necessarily accompanies unemployment.

In direct answer to the hon. Gentleman's serious question, let me say that I spend a great deal of time visiting areas of the country where unemployment is high to see the success of the measures which we have in place to help young people, people in middle age, people who are facing redundancy. That is why I am delighted that I shall be announcing 1½ million places in training and employment schemes to help precisely the people mentioned by the hon. Gentleman.

Business was pleased with the autumn statement. Nigel Whitaker, head of corporate affairs at the Kingfisher group, said: It's good news for the consumer and should help build confidence … It's certainly good in the run up to Christmas Neil Marshall, chief economist of the Retail Motor Industry Federation, said: I think the whole package will have a very positive effect on both consumer and industrial confidence". That is what business said, and business creates jobs; but we must face facts.

Photo of Richard Burden Richard Burden , Birmingham, Northfield

Will the confidence that the Secretary of State perceives among business men be boosted or destroyed in my city, Birmingham? Since May, Birmingham has lost 2,500 jobs, many of them in manufacturing. Will the confidence to which the right hon. Lady has referred be increased or undermined by the Government's threat to withdraw assisted area status from the west midlands?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

I regret that I cannot comment on other Department's plans in regard to assisted area status. I know, however, that people in the west midlands will also have welcomed the measures in the autumn statement—measures relating to cars, manufacturing allowances and help for exports. The west midlands is a particularly vibrant area, and I know that it will bounce back in the conditions that I have described.

Unemployed people now need the security of knowing that we are providing them with real and practical help. I began my speech by stressing the seriousness of unemployment, and the distress that it causes individuals. I am determined to ensure that unemployed people are given ever more effective help to find new jobs; that is why I have carried out a full-scale review of my Department's employment and training measures. I want to tell the House about the new package of measures that has resulted from that review.

Our package will provide a wider range of opportunities than ever before—a total of 1·5 million. It is targeted on helping the long-term unemployed, and those who need most help to get back to work. It will be effective, because it is based on practical experience of programmes with a proven record of success. It will represent the widest range of help that we have ever made available, and it will provide nearly half a million more opportunities in 1993–94 than in the current year.

We shall give priority to the measures that help people the most. We know that two thirds of those who become unemployed leave unemployment within six months. We shall focus on the people with the greatest need, and the measures that have already proved successful.

Photo of Mr Ron Leighton Mr Ron Leighton , Newham North East

How much more money will be available for the scheme to provide half a million places?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

My Department's resources have increased by 1 per cent. in real terms, rising to an extra £200 million.

Photo of Lynne Jones Lynne Jones , Birmingham, Selly Oak

Can the Secretary of State reassure the people of Birmingham that the new schemes will be more effective than Employment Training, under which only 17 per cent. of trainees have obtained jobs while 72 per cent. remain unemployed?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

I shall deal with that point shortly. In the meantime, let me tell the hon. Lady that we have changed the employment training scheme: we have introduced "training for work", a major new programme which will be dealt with by training and enterprise councils and local enterprise companies. It will offer each individual what is right for him or her—skills training, temporary work opportunities or work preparation courses. TECs and LECs will have much more flexibility, and will be funded according to output—according to whether the courses end in people obtaining jobs or qualifications. The hon. Lady should be much encouraged and reassured by that news.

Job plan workshops, which give in-depth individual assessments to long-term unemployed people, build on the proven success of our restart courses and job review workshops. Restart has just been copied by the French: Socialist France is willing to learn from good practice as the British Labour party, apparently, is not. Job clubs improve the chances of obtaining a new job by 50 per cent., with an even higher rate of success for those who are unemployed for more than nine months. In the first six months of 1992–93, 36,600 people found jobs through the job interview guarantee scheme; many of them were long-term unemployed.

Because those two programmes are so successful, we shall be providing an extra 180,000 new places on them next year. Job review workshops, which help people to focus on the options open to them, will have an extra 10,000 places. About 60,000 career development loans, which are a major success story—seven out of 10 trainees obtain jobs after their training—will be made available to people both in and out of work over the next three years.

Photo of Angela Eagle Angela Eagle , Wallasey

I do not think that people object to training, but surely the main problem is one of demand rather than supply. Might there not be some mismatch between skills and the jobs available? However well trained an individual may be, there are too few vacancies for that individual to be certain of securing a job when the training ends. Should we not look at demand for jobs, rather than simply at the supply of a work force?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

The hon. Lady has asked two questions in one. She mentioned the mismatch of skills and jobs; that is precisely why the responsibility for providing training lies with TECs and LECs, which are best placed to know about local demand for skills. I think that the hon. Lady should put her question about demand for jobs to the 1·4 million unemployed people who were placed in work by the employment service last year. It is the experience of the service that, with training and re-skilling and, perhaps, a willingness to travel, people have access to opportunities.

We are focusing our programmes—with their record of success—on those in greatest need: those who have been unemployed for six months or longer, and the groups of unemployed people who face particular disadvantages and need special help to find jobs. Examples are people with disabilities, people who are unemployed as a result of large-scale redundancies, ex-members of the armed forces, ex-detainees, people with literacy or numeracy problems and people returning to the labour market after an absence of two years or more. All those people will be able to join programmes as soon as they become unemployed. These are constructive measures, focused on individuals and their specific needs.

I am sorry to say that this is one of the great differences between the Government and the Opposition: the Opposition talk about numbers, while we try to provide for individuals. Another major difference between us is that Labour dwells in the past, while we invest in the future. Look at our differing attitudes towards young people, for instance: Labour wants them to leave school at 16 and receive benefit, while we rejoice that nearly twice as many are staying on in full-time education or training as did so in 1979. They are staying on because our reforms—opposed by Labour at every turn—have given the country a comprehensive national curriculum and an effective examination system.

We also provide a first-class youth training programme, giving young people skills and qualifications to fit them for the world of today and tomorrow rather than of yesterday. As one of my hon. Friends pointed out earlier, in Britain alone among European countries every 16 and 17-year-old leaving full-time education without a job is guaranteed a two-year training place.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

No Labour Member wants young people to leave school or college and go on to benefit. We want young people to go into jobs. Let me remind the right hon. Lady again what happened to her when she left college in 1961, when unemployment was at 1·5 per cent., and what happened to me when I left college in 1962, when unemployment was at 2 per cent. Like other college and school leavers, we were given a choice of a wide variety of jobs, and we rejoiced in that choice. Labour wants to return to that position.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

The Labour party does not want people to go into training, otherwise it would not have voted against it at every turn, encouraged by its pay masters in the trade unions.

Feeding on ill-informed rumours as Labour loves to do, the hon. Member for Stretford (Mr. Lloyd) wrongly claimed in the House on 20 November that 75,000 young people were waiting for a training place. When I was able to tell the House on 1 December that about 19,000 of this summer's school leavers had yet to take up a training place, I thought that he would welcome the news. Like all members of his party, he seems far too busy singing Britain's funeral dirge to listen to the truth.

Photo of Tony Lloyd Tony Lloyd Shadow Spokesperson (Education)

Is the Secretary of State claiming that 19,000 people falling through the guarantee is a success for the Government?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

The point is that that 19,000 will have been offered a place by the end of this month. I should have thought that that might be something in which the hon. Gentleman would be interested, but he is not interested in the practicalities. He does not seem to understand that some young people want a place which is not immediately available, that some change their mind, and that they all come on to the register at the same time. He should be congratulating us on our achievement.

We see the future as one of partnership, not confrontation. Nowhere is that better demonstrated than in our creation of the nationwide network of training and enterprise councils and local enterprise companies. TECs and LECs are well equipped to give positive and appropriate help to unemployed people in their particular parts of the country. TEC's are based on Conservative concern for the individual, using local expertise which best understands local needs and problems. There is no better illustration of that than the swift response of the TECs in producing local action plans to deal with the results of possible colliery closures.

TECs and LECs succeed because they are a partnership in which Government and business come together. We know what the hon. Member for Holborn and St. Pancras thinks of business men; indeed, he has reiterated it today. I appeal to him to drop his anti-employer stance and to drop the imagery and attitude of the Bolsheviks. He and I know that he is not that old. For once in his life, could not he accept that co-operation achieves more than confrontation?

The clearest evidence that the Opposition are stuck in their past is their attitude to the European social charter and everything that flows from it.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

I must make some progress.

The Opposition have given unqualified and unthinking support to each and every proposal from Brussels, however half baked, however irrelevant to the needs of a modern economy and however damaging to jobs. I have news for the hon. Gentleman: he might like to listen to what I have to say as he should find it interesting.

At last week's meeting of the Social Affairs Council, the employment Ministers of Europe agreed that the most urgent task facing them was to take effective steps to help unemployed people get back to work. The Council did not adopt any new directives which would raise the costs of employment and hold back the creation of new jobs. Instead, it adopted unanimously a United Kingdom presidency resolution underlining the importance of increasing efficiency, supporting new businesses and avoiding the imposition of rigidities which would hold back the creation and development of employment.

The employment Ministers of the Community understand where the real priorities lie. Last week they showed a realism which was entirely missing—alas—from today's speech by the hon. Member for Holborn and St. Pancras. The directives on part-time and temporary work, which we believe would be bad for Britain and for jobs, have not been discussed by the Social Affairs Council for two years.

There is still no agreement on the working time directive. We have always said that that directive is the most damaging of all the proposals under the Commission's social action programme. We have always opposed it resolutely for that reason, but it is now clear that other member states have substantial problems with it. Those problems are a sign of the difficulty of legislating on a European level on issues which have traditionally been dealt with in different ways in different member states, as we have always said. Such diversity of practice is something that the Opposition have not even begun to understand.

The truth is that in Europe, as elsewhere, the British Labour party is composed of yesterday's people pursuing yesterday's agenda.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

If the Government are so adamant that the working hours directive will not be passed, why have they taken powers to abolish the limit on working hours down the mines on the basis that it would be replaced by the working hours directive?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

First, that is not so. Secondly, we have never made any secret of our dislike of the directive. We have always opposed it. Should there be any danger of its being introduced, we have also said that we should challenge it in the European Court. Nothing has changed in that respect, but what has changed is the fact that some of our partners in Europe are beginning to share our view. The hon. Member for Holborn and St. Pancras has again proved that he is stuck in the past, and the same is true of his attitude and that of his colleagues to industrial relations.

Nothing has done more to attract foreign investment into this country than the transformation of industrial relations since 1979. Nothing could be more calculated to drive foreign investment away than a return to the trade union legislation which the Labour party put on the statute book when it was last in government.

Britain is now the most favoured country in Europe for investment by German, American and Japanese companies. In 1991, nearly 40 per cent. of all inward investment into the European Community from the United States and Japan came to this country. It is no wonder that Jacques Delors has described Britain as "a paradise for investment".

Trade union colleagues of the Labour party passed a motion at their congress in September 1991 describing Japanese investment in this country as "alien, perverse and undemocratic". I am glad that one of the sponsors of that disgraceful motion—the Manufacturing, Science and Finance Union—has already eaten its words and last week concluded a single union deal with a Japanese company.

I am sorry that the hon. Member for Holborn and St. Pancras did not see fit to congratulate the MSF on overturning its policy. Perhaps that has something to do with the fact that the MSF sponsors only 12 Labour Members of Parliament. Clearly, they must now disown the Trades Union Congress's policy on inward investment. But what of the other 136 Labour Members of Parliament who are sponsored by other trade unions? Are we going to hear them speak out at last now that the MSF has broken ranks?

The thousands of people in this country who work for Nissan, Sony, Honda and all the other overseas investors which have created jobs for British people in the past 10 years utterly reject the philosophy of trade union leaders who say, "If we can't have jobs on our terms, we'd rather not have jobs at all". That was the philosophy which destroyed 1,000 jobs at Dundee because of a petty quarrel between two trade unions. Until the Opposition are prepared to stand tip against such behaviour by their trade union pay masters, their claim to be concerned about jobs will continue to lack all credibility.

Our policies are in sharp contrast to the job destruction policies of the Opposition. The Opposition claim to be concerned about unemployment, but let us spend a moment considering what that means. They claim to care deeply about young people, but what have they done? They have opposed all the Government's youth training programmes since 1979, declaring their passionate opposition to the youth training guarantee at their 1987 party conference.

The Opposition talk about the need for training, but since 1979 they have opposed every measure brought before the House to improve the skills and qualifications of our people.

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

I shall take no more interventions.

The Opposition work closely with the trade unions, but they have to because so many of them, including all the shadow Cabinet, are sponsored by unions. May we assume that Labour Members of Parliament agreed with the TUC when, in September 1991, it voted to boycott Employment Action before the programme had even begun?

I wonder whether the hon. Member for Gateshead, East (Ms. Quin) agreed with her sponsoring union—the Transport and General Workers Union—when it voted in July 1991 to boycott youth training, employment training and the TECs?

In the unlikely event of the Labour party ever being in power, what measures would it propose for training? Its standard answer to every problem is, "Tax it and regulate it." As an incentive to training at a time of high unemployment, the Labour party before the election proposed a jobs tax. Whereas we give people incentives to train, it proposes to put a levy on employers. Jobs are to be created by putting a tax on them.

Of course, I do not deny that some jobs would have been created. It would be interesting to hear whether the Labour party still adheres to that policy in the manifesto. There will be jobs for civil servants and accountants. Civil servants will be needed to administer the tax and accountants will be paid to avoid it.

For young people, worse would be in store. Young people would be allowed to work only if they had a training contract. Despite the demonstrable success of present policies—twice as many young people enter full—time education or training now as was the case in 1979—compulsion would again he the order of the day.

Our aim in employment protection legislation is to balance the rights of individuals against the needs of those who provide them with work. Too heavy legislative requirements will destroy job opportunities and damage the very people they are supposed to help—the most vulnerable in society.

Labour made its commitment to job destruction absolutely clear when the hon. Member for Holborn and St. Pancras, speaking in the House on 17 November, reaffirmed with a bit of coaxing his commitment to a statutory national minimum wage which would destroy the very jobs Labour claims to protect. How many jobs we do not know—possibly up to 2 million. Even the Fabian Society says 800,000. But that that policy will destroy jobs is not in doubt, as the hon. Member for Kingston upon Hull, East so crisply confirmed.

Over the years, we have got used to the Labour party peddling these antiquated and destructive policies, although after the truly incredible television interview given by the right hon. Member for Islwyn (Mr. Kinnock) on Saturday evening, we wonder whether Labour has any policies, or whether it believes in any of the policies it claims to have.

I have to confess to added disappointment today. I had hoped that the hon. Member for Holborn and St. Pancras would make some contribution to the solution of our problems. I thought that he might have presented some new ideas about helping unemployed people. All we have heard is a web of inaccuracy and half-truths. His speech was shot through with class envy of the usual socialist kind, based on ever-increasing sums of public expenditure. That is the classic Labour solution.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

Will the Secretary of State draw attention to any factual inaccuracy in what I have said today?

Photo of Mrs Gillian Shephard Mrs Gillian Shephard Secretary of State for Employment

Almost every point that the hon. Gentleman made on this country's economic position was inaccurate. What a great opportunity the hon. Gentleman has missed. How sad his performance has been. I wanted to hear a lion roar. The hon. Gentleman has proved that he is really a mouse in sheep's clothing.

Despite the problems of world recession, despite the uncertainties in the European financial markets and despite the unhelpful and destructive attitude of the Labour party, the Government are determined to pursue our strategy for recovery.

I have set out that strategy to the House this afternoon—low inflation, tight public spending, competition and a vigorous supply-side policy. These are the policies, reinforced by spending on capital projects, which will lead to recovery, to growth and to the creation of real and lasting jobs. For we know, as our European partners do, that in the real world there are no quick fixes or easy options. They exist only in the mind of the Labour party.

While we work with business to bring Britain out of recession, we know that one of our first duties as a Government is to help those individuals and communities facing unemployment and redundancy. We will spare no effort to ensure that they receive the best and most effective help that we can provide. Unlike the Labour party, we believe in Britain and her people. That is why our policies deserve the support of the whole House tonight.

Photo of Lynne Jones Lynne Jones , Birmingham, Selly Oak 5:23 pm, 8th December 1992

A few weeks ago, I had the pleasure of presenting the prizes and certificates at my old school. In my day, it was a grammar school. It is now an excellent comprehensive school which produces with a comprehensive intake results as good as those in my day when there was a grammar school intake. When I presented the certificates and prizes to the young women who had left school, I started asking them what they were doing now. I soon gave up because so many of them sadly said that they were looking for a job.

When I left school in 1969, unemployment was 2 per cent. We did not worry about getting a job. We were concerned only about getting a job that we wanted. Sadly, that is no longer the case. Unemployment across the country is more than 10 per cent. and it has been rising every month for the past 30 months. Unemployment in this country has been rising twice as fast as in the rest of Europe in the past six months, during which we have held the presidency of the European Community.

Some 750,000 under-24s are unemployed, the highest figure ever recorded and twice as high as the national average. If ever there was an argument against the Government's case that employment protection and wages councils undermine employment, these figures are that argument, because it is young people whose rights were removed in 1986. They had their protection under the wages councils and their right to minimum wages removed. Yet their unemployment rates are twice those for other workers.

The studies quoted by the Government in parliamentary answers, far from backing their case that wages councils and minimum wages destroy jobs, show that the increased ineffectiveness of the wages councils, as a result of there being fewer wages inspectors for example, has contributed to the decline in employment.

In July, the Secretary of State announced that there would be new measures to underwrite the youth training guarantee. We have been trying to get figures for the number of 16 and 17-year-olds who are waiting for a youth training place. Last week, the Secretary of State finally had to admit that 19,000 young people who left school last summer are still waiting for a youth training place. When they get a place, they are unlikely to be successful in getting work at the end of the process. I do not have the figures for youth training and I hope that, after her announcement last week, the Secretary of State will begin to give the figures month by month and district by district for those waiting for youth training places and for those who are successful in getting work. We should like to see those figures.

Only 9 per cent. of the 2,693 people leaving employment training in Birmingham got jobs and 72 per cent. remained unemployed. From an answer to a question I tabled last week, we learned that there are only half the number of job vacancies notified for the whole of Birmingham as there are unemployed people in my constituency. Selly Oak is not one of the Birmingham constituencies that suffer most from high unemployment, bad as it is at 17 per cent. for male unemployment.

We are not satisifed with the assurances that the Secretary of State has given today. The budget for the measures is 30 per cent. less than it was in 1987. Her assurances today are highly dubious. We look forward to seeing some improvement in the abysmal figures I have quoted.

In October 1990, John Major said——

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. I hesitate to interrupt, but I point out that the hon. Lady referred to the Prime Minister as "John Major". That is not in order.

Photo of Lynne Jones Lynne Jones , Birmingham, Selly Oak

I apologise, Mr. Deputy Speaker.

In 1990, the Prime Minister said on taking office: It will take time—it always does—to change the economy. It is like turning the Titanic round. Some of us believe that the Titanic is well on its way to hitting the iceberg. However, there appears to have been a change of heart in the past month. After the Government's central policy, based on membership of the exchange rate mechanism floundered, the Government suddenly announced that they were turning the Titanic in a different direction. Last Thursday, the Prime Minister said that The only way to create long-term sustainable jobs is to create the right policies"— create the right policies? What has the Prime Minister been doing for the past two years?— that produce long-term sustainable growth. That is precisely what we are putting in place."—[Official Report, 3 December 1992; Vol. 215, c. 390.] The Government have been in power for the past 13 years and we presume that the policies that they claim they are putting in place, which will lead to recovery, are those announced by the Chancellor of the Exchequer in the autumn statement.

However, when the hon. Member for Mid-Staffordshire (Mr. Fabricant) asked the Secretary of State for Employment last week to make a statement about the employment prospects of the proposals in the autumn statement, the right hon. Lady was evasive at first. When pressed about the precise number of jobs that would be created, she said: Priority has been given to protecting programmes with significant employment implications."—[Official Report, 1 December 1992; Vol. 215, c. 135.] That is hardly about growth, creating employment and getting the economy off the rocks or the iceberg that we are sadly approaching.

Despite the best talking up of the green-shoots tendency by Conservative Members, the autumn statement will simply, it is hoped, prevent this country from moving from recession into slump. The autumn statement is not enough to create the long-term sustainable growth and reduction in unemployment that the Prime Minister talked about.

We should take a leaf from Japan's book. Japan already has a predicted growth rate of 1·8 per cent. this year. The Treasury does not believe in the green shoots that are to come from the autumn statement. The Treasury forecasts a rise in growth of only 0·75 per cent. in this country next year.

Japan's growth rate is already much higher than ours and it has 2·2 per cent. unemployment. However, the Japanese Government realise the danger of recession and they are planning to invest the equivalent of 60 billion ecu—more than the entire EC budget—in infrastructure and investment for the future. That is the kind of approach that we need in this country if we are to reduce unemployment.

My colleagues in local government in the west midlands have submitted a package of measures that they would like to see implemented in the west midlands. The package includes infrastructure projects and an agreement to go ahead with the midland metro; further derelict land grants; removal of toxic waste from canals; and a new station for Birmingham.

We are also aware that there is a dreadful problem of homelessness and bad housing in this country. The Institute of Housing and all respectable housing forecasters claim that we need at least 100,000 social housing units a year. However, there will be only 32,000 this year. There is surely scope for greater investment in housing. However, despite the talking up in the autumn statement, investment in housing is likely to be cut. In addition, programmes for housing associations, other than for buying up houses on the open market which we certainly welcome, are also to be cut.

Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield

Does the hon. Lady agree with the hon. Member for Peckham (Ms. Harman) that public spending next year should be higher titan £244·5 billion? If so, how should that be financed—by increased taxation or increased borrowing?

Photo of Lynne Jones Lynne Jones , Birmingham, Selly Oak

I agree that expenditure must be increased if we are to save expenditure in the long run. The Secretary of State for Employment has already told us the cost of unemployment. If we do not tackle the issue now, unemployment will continue to rise. We must invest in infrastructure and housing. However, if we need to increase taxation, let those who have benefited most from the Government's mismanagement—those who have seen their tax cut by 200 times that of ordinary people—make a contribution to help us get out of the recession.

There is a desperate need for greater investment in housing. However, the Government offer us more of the same. They give with one hand and take away with the other. They are withdrawing support to local government. About £200 million will be lost to local government in England—£35 million of that to my local authority in Birmingham. There will be more job losses as a result of that. There will be cuts in the urban development programme and the much-vaunted city challenge programme will be abandoned.

On 26 November, the president of the European investment bank said: If asked we would increase the speed of financing for infrastructural projects. We are ready to do this. While we have the presidency of the EC, surely we should take advantage of that offer. Later this week, I hope that we will talk with our European partners about getting Europe and this country back to work.

When the President of the Board of Trade was a Back Bencher in 1987 he said: Government cannot pretend that it is not involved in decisions about the future of the key platforms of industry or that it is up to the companies alone to ensure that they are able to compete effectively in the managed marketplace of the world. There are industries such as the steel industry, the car industry and the air frame industry which cannot be allowed to fail if Britain is to remain an advanced economy. Ideally the Government should not own them, but it has an ultimate responsibility to determine if they have a role in the economy. Last month, in response to a question from an hon. Member about whether he should do more to ensure that we diversify our high-tech industries, the President of the Board of Trade said: Diversification will take place in British industry as a result of the entrepreneurial skills of industry managers, and no one else."—[Official Report, 4 November 1992; Vol. 213, c. 269.] Those industry managers do not agree with that.

I end by quoting Samuel Johnson: We frequently fall into error and folly, not because the true principles of action are not known, but because for a time they are not remembered. The President of the Board of Trade should remember his earlier words before it is too late.

Photo of Mr James Couchman Mr James Couchman , Gillingham 5:37 pm, 8th December 1992

In following the hon. Member for Birmingham, Selly Oak (Dr. Jones), I want to refer to the point that she made in respect of the wages councils. In defence of the wages councils, she said that the reduced role of the wages councils over the past four or five years and the inadequate number of wages inspectors had led to the destruction of jobs. I simply do not believe that.

I am a rare animal in this place because I am an employer. No doubt, if the hon. Member for Bolsover (Mr. Skinner) was in the Chamber, he would deride the fact that I have two jobs. I still run a family company and I have run it through extremely difficult times more than once, but the present times are as bad as any I have known.

My right hon. Friend the Secretary of State was right to say that confidence is desperately needed to rebuild all our businesses. I suspect that there will be a slow starting, but gradually accelerating, spiral upwards as the recession recedes and recovery begins. I look forward to that.

As an employer in a very low-tech business in a service industry—all the things that are derided by the folk on the Opposition Benches—I must tell the House that the working time directive, minimum wages and the kind of social on-costs for labour envisaged by Opposition Members would not help me.

I was astonished by the cheek of the hon. Member for Holborn and St. Pancras (Mr. Dobson), but then I always am. I was also somewhat regretful that he did not give way to me, because I had a simple question for him. I was going to ask whether he would vote against the private Member's Bill of the hon. Member for Ogmore (Mr. Powell) to bring Sunday trading back to the position under the Shops Act 1950. That would destroy thousands of part-time and full-time jobs for those who work on Sundays. The hon. Gentleman did not give way, and I shall not give way to enable him to answer my question. I shall wait until next time for him to tell us.

The hon. Member for Holborn and St. Pancras talked about training. He said that the Labour party's great nostrum to solve our unemployment problem is training. I remember that the last effort of a Labour Government—it is not simply historic, but almost pre-historic—was the introduction of the youth opportunities programme. The programme was called YOPS for short. Some of my hon. Friends who remember that programme will agree that it was the ultimate cheap labour scheme.

The hon. Gentleman made much of manufacturing, as did many other Opposition Members. I regret the loss of our manufacturing base and many industries. My constituency in the Medway towns is much more like one of the northern industrial towns which depended largely on heavy engineering for their employment. But those days are gone, and heavy engineering has been replaced by different businesses. High-tech, light engineering and avionic businesses are the backbone of manufacturing in the Medway towns. Manufacturing is also carried out by companies such as CAV Lucas, which I visited not long ago. During that visit I understood for the first time exactly why manufacturing employment has gone to the wall. I was shown an all-dancing and singing machine which did 27 different things to metal. That means that 27 different jobs have been taken over by a machine which was manned by one minder. With three shifts a day, 78 manufacturing jobs have been lost. It is no surprise that our manufacturing employment base has declined if' that is typical of the sort of manufacturing on which we made our great days.

The hon. Gentleman talked about investment. as do other Labour Members. Most investment that goes into manufacturing industry today is aimed primarily at doing away with labour, not with creating it. Most investment does not create jobs; it does away with them. That is not surprising, because there is not an employer in the country who is not examining his labour costs to see whether he can reduce them.

Photo of Mr Ron Leighton Mr Ron Leighton , Newham North East

Is the hon. Gentleman aware that the country that has made the most investment in high technology is Japan, which has the lowest level of unemployment?

Photo of Mr James Couchman Mr James Couchman , Gillingham

I accept that entirely. It is something which we want to learn from the Japanese. That is why I welcome the settlement of three Japanese companies in my constituency.

I shall say something in a moment about inward investment. I think that we should take the remedies of the hon. Member for Holborn and St. Pancras with a pinch of salt, because, unless he acknowledges what has happened to manufacturing industry, he acknowledges nothing.

If the 19th century was the British century and the 20th century was the American century, the 21st century will be the century of the Chinese and the Pacific rim. From my recent visits to the far east it seems that we should seek inward investment from companies in Japan, Taiwan, Korea and Hong Kong. We should welcome such companies. Those countries want to create a European base, and they have chosen the United Kingdom as the place in which to do so, for four good reasons. First, if they speak anything other than their own oriental languages, which we do not understand, they speak English. That is a powerful reason to come to the United Kingdom.

Secondly, such countries like our industrial relations. The successive employment measures that the Government have introduced since 1979 have provided good industrial relations in the United Kingdom. Thirdly, they like our corporate tax regime. The United Kingdom has the lowest corporate tax rates in Europe. Those countries like that very much—and who would not like it if he wanted to make a profit?

Fourthly, those countries like to settle in the United Kingdom for the reason that my right hon. Friend the Secretary of State mentioned—we have not accepted the social on-costs of labour which are such a burden to German, French and Italian companies. It is the reason why we have not taken on the social chapter. I hope that we will never take on the social chapter, because it would be a powerful disincentive to come to the United Kingdom.

I want to refer to one successful industry—the pharmaceutical industry—and sound something of a gipsy's warning to the Secretary of State. Before doing so, I must declare an interest, because I advise a large pharmaceutical company in Kent. I draw the attention of the House to a recent statement of the Secretary of State for Health who suggested that she would curb the drugs budget once again by increasing the number of therapeutic categories that would be limited for prescription.

The pharmaceutical industry contributes £1·2 billion each year to the trade balance. It has research and development of £1·3 billion, which is 18 per cent. of the industry's turnover in the United Kingdom. The industry is immensely successful. It is another example of inward investment taking place in the United Kingdom because large American companies have chosen to do their European R and D for the pharmaceutical industry in this country. The American companies like the quality of our scientists. That is very important. We must cherish that quality, and we must do everything we can to build it up.

I am worried by the recent warning of the Secretary of State. I have already said that we will substantially damage confidence in the pharmaceutical industry if we take hasty, short-term measures to curb the drugs bill. I ask Ministers to examine the matter carefully before introducing such a restriction because there is huge over-capacity in pharmaceutical manufacturing in Europe. Once we pass 1 January and enter the single market, the pharmaceutical industry will take steps to rationalise manufacturing. Manufacturing gives us the trade surplus of £1·2 billion, and it employs many people. I am sure that my right hon. Friend will take on board those words and will speak to our right hon. Friend the Secretary of State for Health.

We are unlikely to see a substantial return to the heavy engineering, low-tech, metal-bashing industries which made this country's manufacturing base during the 19th century. However, we shall need to cherish the new industries which come in through inward investment or are generated in the United Kingdom by our own entrepreneurs.

I accept everything that the Secretary of State said about the factors for recovery being in place. The only missing ingredient is confidence. Every step that the Secretary of State and other Ministers take should be designed to bolster confidence, not to do it down.

Photo of Mr David Alton Mr David Alton , Liverpool Mossley Hill 5:48 pm, 8th December 1992

The hon. Member for Gillingham (Mr. Couchman) mentioned his desire to see the abolition of the wages councils. He suggested that the continuation of the councils would be an impediment to employment. He will not be surprised to know that I do not agree with him. Winston Churchill established the wages councils for a good reason—the protection which they offered employees.

The hon. Gentleman then referred to the Sunday Trading Bill proposed by the hon. Member for Ogmore (Mr. Powell). I recall that it was also Winston Churchill who said that Sunday was the greatest British institution and, therefore, should be prized beyond all others. He recognised the importance of Sunday as a day of rest for workers and a time when people could be with their families. If additional shop work were made available, I for one should like to see it shared with those who are unemployed at present, rather than forcing many shop workers, against their wishes, to be employed on a Sunday.

I wish to take up two comments that the Secretary of State made. She talked a great deal about improved industrial relations. We are all happy that the days of wildcat strikes and secondary picketing are behind us. I supported the measures that the Government took in 1980 to stop secondary picketing and their introduction of the secret ballot. But the Secretary of State will agree that fear of unemployment is one of the reasons for the improvement in industrial relations.

In the longer term, rather than relying on fear we should encourage a climate based on co-operation and partnership—two words which the Secretary of State used in her speech. We should look to the German model of industrial partnership, co-operation and profit sharing—the three Rs of rights, representation and reward.

I took slight exception to the Secretary of State's suggestion that anyone who raised the plight of those who were out of work talked Britain down. She implied that there was a lack of patriotism in even daring to mention the number of people out of work. She said that we should be interested not in statistics and figures but in the individuals who lie behind them. No one in the Chamber would disagree with that. The figures reveal the scale and the effect of unemployment on the human personality and the families and communities in which they live.

Rather than trading remarks across the Chamber, I hope that we can build on the Secretary of State's suggestion this afternoon that we need real partnership and co-operation to tackle this curse of unemployment. It is disingenuous to suggest that any Opposition Member who expresses concern about the unemployed talks Britain down. By all means, highlight success in the Department of Employment or in the country—everyone is happy to hear about success stories—but we should never forget those who are not so lucky.

Living in and representing a city such as Liverpool brings one face to face with the calamitous effect of long-term, institutionalised unemployment. This week the Liverpool Research Group in Macroeconomics, the accountants Ernst and Young and the Liverpool Daily Postpublished their biannual report on the prospects of our local economy.

The remarks made by Professor Patrick Minford conflict with some of the comments made by the Secretary of State today. He said: the prospects for reviving employment on Merseyside are poor. Instead, what we are forecasting is a continuation of falling employment in virtually all sectors accompanied by a steady outflow of the labour force and population. That is a depressing picture for those of us who have seen a massive decline in the numbers of people living and working in the Greater Liverpool area in the past 20 years. A nation of Dick Whittingtons has been created in which a policy of national mobility has sucked people away.

Photo of Angela Eagle Angela Eagle , Wallasey

Does the hon. Gentleman agree that it is a bit rich to hear strictures from Patrick Minford about our economic success, or lack of it, when he was one of the leading lights of the mad, fundamentalist economic movement known as monetarism which so afflicted the first part of the Conservative period in office? Does he agree that that ideological dogma has had a great deal to do with the persistently high rates of unemployment experienced by Liverpool, Wallasey and other parts of the country in the past decade?

Photo of Mr David Alton Mr David Alton , Liverpool Mossley Hill

The hon. Member for Wallasey (Ms. Eagle) obviously missed the irony of my remarks. I quoted Professor Minford because the Government have consistently quoted him in the past 13 years in support of their monetarist approach. Instead of dragging out of the cupboard quotations from the Kingfisher group, as the Secretary of State did earlier, I thought that it would be interesting for the House to hear from someone who has been a supporter of the Government's policies in the past 13 years—the Government would not deny that—and is a well-known monetarist.

Professor Minford's forecast for the Merseyside economy does not bear out some of what the Secretary of State said. I hope that his forecasts and the soothsayers will be proved wrong. I do not want to talk down the prospects for recovery on Merseyside any more than I want to talk down the prospects for recovery in Britain, but we must listen to what people are saying and look at the reality of life in areas like Merseyside.

On Merseyside more than 17 per cent. of the people are unemployed. We have had the bleak news this week of further redundancies at Cammell Laird. I am sure that the hon. Members for Wallasey and for Birkenhead (Mr. Field) will speak further about those redundancies, if they catch your eye, Mr. Deputy Speaker. The prognosis is not good for Merseyside and the Government's fatalistic and defeatist approach will be of little comfort to individuals, families and communities who face the curse of further unemployment and the possibility of literally 50 years on the dole.

Photo of Mr Graham Riddick Mr Graham Riddick , Colne Valley

Surely the reality is that the trade union barons have brought Liverpool almost to its knees. Has not their dogma, stupidity and irresponsibility over many years made it so difficult for Liverpool to attract inward investment?

Photo of Mr David Alton Mr David Alton , Liverpool Mossley Hill

I stand second to none—the hon. Member for Birkenhead would probably stand in my company—in saying that we have fought Militant and other extreme groups about which we have heard this afternoon. We have seen such groups trade on unemployment in Merseyside. However, it would be wrong to deduce that we have a workshy labour force or that people on Merseyside do not give as much value for money as the next people. That is not true. Many companies in Merseyside operate just as successfully as companies elsewhere. We now have one of the highest productivity records in the country.

One needs only to visit a place such as Liverpool Freeport to see business which is booming, with record profits and levels of trade last year. Where the trade unions work in partnership, they can be a positive force. So let us not be simply anti-trade union or anti-workers. We require a partnership such as the Secretary of State referred to earlier. Measures such as the abolition of the wages councils will not facilitate the creation of such a partnership.

In Liverpool, 40,000 people are without jobs. In the north-west region, 254,000 men and 75,000 women are without work. In our country, 2·8 million people languish on the dole queues. In October this year a further 24,000 British people joined the other 17 million Europeans who are currently unemployed.

Communities that have depended on traditional forms of work have fared especially badly. Shipbuilding and coal mining communities are simply the latest and most graphic examples of that. In such communities there is an acute sense of abandonment, desolation and hopelessness.

if we are without work, the issue is direct and immediate. It brings into question previous jobs, provision for the family, coping with old age, what to do each day, how to pay back loans and mortgages, what other people—including our marriage partners and children—will think of us and what the future holds. Other tragedies such as alcoholism, depression, marital breakdown, homelessness and even death are all associated with job loss. For young people, with no prospect of work, there is often bitterness, alienation and apathy.

I was especially worried by the way in which the plight of young unemployed people was casually brushed to one side this afternoon. Most of us know the truth of the old saying that the devil will always find mischief for idle hands. One only needs to see young people hanging around on street corners, with nothing to do and nowhere to go, to understand their plight. It is not an excuse for lawlessness or committing crimes and it is not the only reason for crime. However, there is a connection between the listlessness, frustration and boredom of being out of work and the one crime committed every two seconds and high levels of drug abuse—0·5 million people have taken Ecstasy and 100,000 are addicted to drugs generally. Being unemployed means having nothing to do, and that can rapidly come to mean having nothing to do with the rest of us.

Most of us view unemployment from the outside and we are frightened by it. It is a threat to affluence, status and our place within the community. We are right to be frightened, because a substantial proportion of no-job families remain locked into poverty and worklessness. In Britain today 2 million children live in families afflicted by poverty; 30,000 families live in hostel accommodation; 150,000 16 to 19-year-olds experience homelessness. Frequently those are also the people without jobs.

What are we to do? I wish to mention three things—the sharing of jobs, new job creation and better training. First, we should abandon fatalism and defeatism, which suggest that nothing can be done. Markets can be reshaped and institutions can be restructed in ways which give a strong and positive value to employment.

In Liverpool, the city's coat of arms bears the mildly ironic Latin words, Deus nobis haec otia fecit"— God has provided for us this leisure. Instead of long-term and enforced leisure for 15 per cent. of our population—the figure is rising—we should devise ways in which to share the available work.

Some areas and families are job-rich, and others have no jobs. Many parents would willingly take a sabbatical away from their career to help to bring up their children or to care for a disabled person or an aged relative. They would do so if the tax and benefit systems recognised the value of such a commitment. That would free work for others and help to prevent the high costs of vandalism, crime, work failure, low educational achievement and statutory personal supervision, which so often stem from family breakdown.

Earlier retirement and sabbaticals for training or time out for further educational development also free work, while enhancing the quality of the work force. At present we have a crude system of work sharing. It is called unemployment—90 per cent. have a job and 10 per cent. have not. Surely we can do much better than that.

In Britain, we need to re-learn how to share, but we must also learn to create new work, and that is my second point. All around us tasks are waiting to be done. Surely it cannot be beyond our wit to find creative ways to harness the abilities and talents of hundreds of thousands of unemployed people. Energy conservation schemes make particular sense, since they can be targeted at low-income households as well as providing jobs.

Construction jobs represent a low inflationary way to put people into work and an investment in infrastructure, which is falling apart. Often our public services are a disgrace and in many areas the local environment is tacky and tatty. The condition of many people's homes is deplorable: 2·4 million public sector homes are in need of repairs of more than £1,000 each; 909,000 homes are unfit for human habitation; and 463,000 homes lack basic amenities. Work is waiting to be done and we are paying construction workers to remain idle on the dole. If construction workers lived together in communities and were easily identifiable as such, I am sure that the people of Cheltenham and elsewhere would have been on the streets marching in the same numbers that we saw when mining communities were faced with 30,000 redundancies. There is work waiting to be done and skilled people waiting to do it.

Anyone would think that it costs us nothing to keep people out of work. Apart from the social costs that I have mentioned, there are economic costs. This year it will cost more than £20 billion in benefits and in lost taxes, which would otherwise have been received by the Exchequer if those people were in work. That is the cost of keeping people on the dole and it is a tremendous waste of national resources.

Someone asked how one would finance schemes to provide work. It is not merely a question of running up the public sector borrowing requirement, although goodness knows it is lower than in many of our competitor countries and there may be room for some additional borrowing to finance schemes. In addition, there should be a small increase in taxation to pay for them. Above all, the cost to the Exchequer of keeping people out of work is surely justification enough for translating those resources into creating jobs rather than keeping people unemployed.

In unpublished evidence to the Select Committee on Employment on 21 October, the Secretary of State suggested that the annual cost of keeping one person unemployed was about £9,000. The other side of that coin is that, in 1991, the average income generated by every extra 100,000 people in employment would have been about £1·7 billion. That figure might be an overestimate, because many unemployed people might not be able to get the most highly paid or productive jobs, but the implication of such a loss of revenue contributions holds good. Unemployment is not an efficient way to lubricate the economy.

Thirdly, in addition to sharing and the need to reallocate resources to job creation, we need to consider training and future employability. A dirigiste and often meritricious approach to education has left us with 25 per cent. of our work force—that is 6 million people—illiterate and innumerate. Our failure to educate properly leaves people unemployable. Only 35 per cent. of our 16 to 18-year-olds go into full-time education or training, compared with 79 per cent. in the United States and 66 per cent. in France. We also secure fewer graduates: 132 per 1,000 of 21-year-olds, compared with 236 in Japan, 230 in America and 202 in France.

As the Confederation of British Industry has urged, we must be more ambitious about increasing the number of graduates. The Secretary of State referred to the additional people who will join the training and enterprise councils. She said that places for about 1·5 million people would be found. It would be absurd not to welcome that, but as I told the Minister who will reply to the debate last week during Employment Question Time, not everyone receives a place on a TEC course. The real challenge for the TECs is what they do about people who have come straight from school and who are illiterate or innumerate. What will they do about disabled people on projects such as the Greenbank project which has lost its funding and which I mentioned to him last week?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

The hon. Gentleman may be interested to know that part of the package that my right hon. Friend the Secretary of State has put together includes help for people suffering from problems of literacy and in-numeracy, which I agree is an element of some of the problems faced by the long-term unemployed.

Photo of Mr David Alton Mr David Alton , Liverpool Mossley Hill

I am glad to hear that and will give the package a fulsome welcome. Otherwise that group of people will become the long-term unemployed, for whom no one will be able to find places. It is all too easy for TECs to take in the cream—people who leave school relatively well qualified. People who have no qualifications will be the challenge and I welcome the Minister's intervention.

Training, sharing and job creation are all the business of Government. Sadly, inflation has dominated the political debate and unemployment has been treated as a residual concern. Caring about both is not stirring oil and water. Any economic system that ignores its impact on people, idolises the market and elevates the cult of the individual is doomed to failure. Our failed economic system has left people unable to find jobs. Businesses have closed and inadequate funds have been made available for public expenditure. Community and family life are often in tatters. That is a long, bitter and unflattering record.

The emptiness and failure of present policies should serve to stimulate a long overdue change, and I am grateful to the official Opposition for providing us with the opportunity to mention such issues this afternoon and for enabling us to contribute to that debate.

Photo of Dame Cheryl Gillan Dame Cheryl Gillan , Chesham and Amersham 6:07 pm, 8th December 1992

The hon. Member for Liverpool, Mossley Hill (Mr. Alton) mentioned wages councils in his opening remarks. He may find himself on his own in supporting them. In an earlier debate I challenged the hon. Member for Holborn and St. Pancras (Mr. Dobson) on whether he would reintroduce them should—God forbid—there ever be a Labour Government. He chose not to respond to that question.

Photo of Ms Joyce Quin Ms Joyce Quin , Gateshead East

I am interested in the hon. Lady's remark, because she and her hon. Friend the Minister have misrepresented our views in that way on a few occasions. I hope that she will accept that there is a world of difference between a party which wants to abolish the wages councils, full stop, and one which wants an effective system of wage protection, which might include such councils or another system. The gulf between the two main parties on that issue is very wide.

Photo of Dame Cheryl Gillan Dame Cheryl Gillan , Chesham and Amersham

The hon. Lady is entitled to her interpretation of the record of the House, but I commend her to re-read it. It was clear that the hon. Member for Holborn and St. Pancras refused to answer my intervention in the affirmative.

I should like to declare an interest as I am a director of Kidsons Impey, a firm of chartered accountants, and I am also an employer and so I hope that I can bring to the House a businesswoman's approach to employment and unemployment.

The motion on the Order Paper typifies the way in which Labour Members view the country today. At a time when all agree that we require confidence, it is couched in words which would not inspire confidence in anyone listening to the debate or watching from outside as a potential inward investor.

Labour Members always look at the bottle as being half empty. It is time that they discovered that it might be half full. I wish tonight to examine the matter from a constructive standpoint, looking at the bottle as being half full. For a start, let us examine some of the jobs that have been created, some of the work practices that are expanding employment opportunities and the positive steps that we have taken to support our businesses and industries.

No Government want high unemployment. In a democracy, the power to govern comes from the votes of the citizens, and an unhappy and unemployed citizen is far less likely to vote for a party which presided over his or her misery. And misery it is, for I have several friends who in the last year or so, through no fault of theirs, have become unemployed and unable to find work. They want support and ideas, but they do not want tea and sympathy. They want action, and that is what the Government have taken.

Governments do not directly create jobs, except in the public sector. The wealth-creating private sector creates jobs. Even so, Government must create the conditions in which the private sector can flourish. Those conditions must include low inflation, low interest rates, low unit wage costs, low taxation, good industrial relations and opportunities to reskill and retrain. That is the environment for growth that the Government have created, despite the recession, in which all the main world economies have hit rock bottom more or less at the same time.

Business is beginning to respond to those conditions, and I want the House to consider some of the good news stories of the past week. Today, Rover announced that it is calling in workers for the first time to work on a Sunday. That is being done in response to increasing orders for the Rover 800. DH L International, the courier company, has announced that it is planning to increase its work force by 23 per cent. QPL International, the microelectronics company, is creating 280 new jobs at INMOS, International Metal Oxide Semiconductors.

In the last week, the House of Commons Library has been tracking articles containing announcements of new jobs, and several thousand jobs are listed. They are appearing in the national press, revealing the intentions of industry and business, responding to the environment that the Government have created.

The small and medium-sized business sector does not get well reported and is often not properly identified, even though it comprises much of our business and creates jobs on a daily basis. The number of jobs created in the last week alone is a story that speaks for itself. Unfortunately, that story does not make the headlines. That is a crying shame because we need to demonstrate such results to restore confidence.

Opposition Members claim that we have squandered our European presidency. I strongly disagree. On 4 December, the employment Ministers unanimously adopted a resolution underlining the importance of increasing efficiency and the need to support new businesses. Under the British presidency, we have started to move the Community away from rigid directives that would strangle business and growth.

The social chapter and the working time directive are examples of this. What would Labour Members tell the shift workers at Alcan in my constituency who have arrived at an arrangement with management to work 12-hour shifts Monday to Thursday so that they can have Fridays, Saturdays and Sundays with their families? That arrangement suits the workers and the management. Would Labour Members tell them that the working time directive would not allow them to work those hours, so that they would not have an improved quality of life and time with their families?

Europe is starting to take a lead from the United Kingdom. They are looking with interest at a country which, except for Denmark, has the highest proportion of its adult population in employment, has one of the lowest unemployment rates for the under 25s and has working conditions that have attracted the largest proportion of inward investment from countries outside the Community. In difficult economic circumstances, we are making great strides, and business and industry are pressing ahead, particularly in their flexible working arrangements, which are being adopted to reflect the changing needs of the working population.

Since 1979, many changes in working patterns have taken place. As of June of this year, compared with June 1979, there had been a 65 per cent. increase in male part-time employment and a 20 per cent. increase in female part-time employment. Adopting changes such as job sharing have made that possible, and job sharing is now practised widely, notably and successfully in the House of Commons Library, which provided the statistics that I am using.

Industry has been quick to grasp other ideas that have made employment fit more aptly the needs of people who are concerned with the quality of their lives. Flexitime, home working, the provision of creches and working on Sundays are now options available to many who work.

Sadly, there are no jobs for life. We need look only at Japan—several hon. Members have referred to the situation there—which prided itself on a system supposed to guarantee work until retirement. The economic slowdown revealed that utopia for what it was—social engineering that fell at the first hurdle in a recession. Perhaps Japan will begin to look more closely at the United Kingdom working environment, in which self-employment has risen by 58 per cent. since 1979.

Sanyo Electric, which is planning to reduce its work force in Japan by over 2,000, is offering early retirement to employees over 50, saying that that will enable them to start something different before it is too late. Society in Japan is changing, and it is clearly changing towards our pattern. So perhaps in the way in which we learnt some of the good points of Japanese business, they will benefit from our good employment practices.

Having told the House of some of the new jobs that have been announced and some of our work practices, I move on to some of the positive steps that the Government are taking. The autumn statement was a milestone, carefully targeting areas of weakness in the economy. It was designed to boost employment and help the unemployed back to work. We have already heard in the debate of many favourable responses to the autumn statement.

Our withdrawal from the ERM, no matter what one's view, gave us the opportunity to reduce interest rates. That has been of direct benefit to the employment-creating sector of the economy—the private sector.

Photo of Angela Eagle Angela Eagle , Wallasey

Did the hon. Lady agree with the Government's policy to join the ERM in the first instance, even though interest rates thereafter increased dramatically? She is now praising the fact that we were forced out of the ERM.

Photo of Dame Cheryl Gillan Dame Cheryl Gillan , Chesham and Amersham

We are discussing employment—a subject that is supposed to be close to the hearts of Labour Members—not Europe. I would be happy to debate European matters with the hon. Lady on another occasion.

No matter what one thinks about our withdrawal from the ERM, it gave us an opportunity to reduce interest rates. The businesses with which I deal have appreciated that reduction, which has helped them at a time of recession.

My right hon. Friend the President of the Board of Trade has been working hard at the Department of Trade and Industry and his announcement about one-stop shops was designed to help small and medium-sized businesses, which are so important in job creation.

Photo of David Hanson David Hanson , Delyn

Will the hon. Lady give way?

Photo of Dame Cheryl Gillan Dame Cheryl Gillan , Chesham and Amersham

No, I have given way enough.

In her opening speech my right hon. Friend the Secretary of State gave many examples from her Department, which the Opposition may notice is called the Department of Employment, not the "Department of Unemployment". Those benefits and measures add up to significant Government action to encourage the economy and our businesses and industries.

The economic report by the Organisation for Economic Co-operation and Development in the United Kingdom in 1991 described the Department of Employment's activities and reforms, such as deregularisation, privatisation and the reform of employment law, as "impressive" and said that they had helped to reverse the United Kingdom's relative economic decline.

The Government's formula for business will put people back to work and their policies will create an environment for success. We believe that a partnership between Government and business will create real jobs. It is now up to business to build on and add to that framework. Unlike the Opposition, we are backing British jobs and business. There is no sign of leadership, business acumen, reality or confidence-giving from the Opposition.

My right hon. Friend described the hon. Member for Holborn and St. Pancras as a mouse in sheep's clothing, but I must admit that he has surpassed himself in size by following dinosaur policies that are outmoded and outrageous and, thankfully for business, industry and jobs, he is out of power.

Photo of Frank Field Frank Field , Birkenhead 6:22 pm, 8th December 1992

I shall not follow in detail the speeches of the four speakers who preceded me, but I wish to pick up themes from their speeches.

The Secretary of State is not only a good but also a highly intelligent person. I want her to imagine what it would be like for somebody who had been asleep for 30 years to wake up and listen to her speech. Would that person recognise the country as we see it or would he think that her speech was relevant to a Britain of 30 years ago? We thank her for most of the measures that she announced in her speech, such as job clubs. Although they are all important, they are totally inadequate as a strategy for dealing with the ever-growing number of people captured by unemployment.

The Secretary Of State gave it away at the beginning of her contribution by talking about the "distress" of unemployment as though it were like suffering from a heavy cold. Unemployment is not merely distressful. There is an anger and despair felt by a large number of our constituents. They feel a hopelessness about the situation and we must continue to represent that feeling in this debate. It is crucial that that is the cornerstone of building a policy to move this country back to full employment.

The motion mentions the high level of redundancies, so I wish to discuss the issue of Cammell Laird. As the House knows, last week the owners of Cammell Laird threw in the towel. They threw up their hands in despair and said that they could see no alternative for our yard but closure. I had a brief opportunity to tell the House then that the workers and the people of Merseyside would not accept that scenario because unemployment is already too high in our area. In my constituency and that of my hon. Friend the Member for Wallasey (Ms. Eagle) the official unemployment rate is 14 per cent. The grandparents, parents and offspring of some of the families whom we represent are currently unemployed. Our newspapers carry reports of whole streets in our area in which not one person is at work.

To be told that the owners of Cammell Laird intend to destroy the livelihood and skills centre in Merseyside is not acceptable to us because we have seen what the future is like if there is no work. We are not merely holding out a begging bowl. Cammell Laird is a priceless asset of this country. Its closure should be not simply a local issue but a national one if we are to survive as a great trading nation. We shall therefore fight against its closure. It will be a national fight and we shall not simply sit idly by or make speeches in this House about the criminal loss of skills and the skills centre. I hope that the country will support us in our fight because we know that, without such a skills centre, Merseyside has no future. If Merseyside is closed skills centre by skills centre, the same future will envelop the whole nation.

The fight goes well beyond Birkenhead and beyond the Merseyside borders, because it concerns the country's manufacturing base. If we are to say that some of the most highly skilled and precious members of the work force can be discarded because the employers are at the end of their wits, and do not know what to do, it is a grim scenario not just for us but for the nation.

For those reasons, I am happy to spell out in more detail why we shall not accept that closure and why the Government should not stand idly by and accept what Vickers Shipbuilding and Engineering Ltd. has handed down as a death sentence to Cammell Laird. The Government are closely involved in the position that has been reached and with the future of the workers in Merseyside. The fact that the Government sold that taxpayers' asset for £1 excites local constituents more than anything else. How could something so valuable have been valued in that way and now be so easily discarded by those whom the Government trusted with ownership?

The Government are VSEL's only supplier, so they have an enormous interest in its behaviour. As we now know—it will become known because we intend to repeat it—they hold a golden share in VSEL. At this stage, we are asking the Government not actively to intervene but to keep an active watching brief. Our first and crucial fight is to wrestle away from VSEL the title deeds and dowry to that yard so that we can go our own way. When that task is complete, we shall look to the Government for practical and positive help. It will not be on the scale of the intervention of the 1960s. We know that if we are to survive we must play a part in mapping out the sort of positive employment policies that the Government must pursue if they are to beat back the rising tide of unemployment.

I am happy to note that the Secretary of Slate for Employment has returned to the Front Bench, for which I am grateful to her. I am now able to say to her that I hope that we have heard for the last time the sort of speech that she gave today. Every one of the measures that she mentioned was proper and important, but her speech did not match the urgency felt by the millions of people in this country who are today drowning in a sea of unemployment. Our task today is partly to convince the Secretary of State of that.

I congratulate my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) on being brave enough to talk about full employment and placing that once again on the agenda. I have some ideas to pass on to my hon. Friend to use in his fight in the party. It is noticeable—I shall say this before anyone else does—that full employment is not mentioned in our motion. If policies for full employment are not contained in the Labour party manifesto at the next election, the Labour party will face its fifth election defeat, and deservedly so. When my hon. Friend fights his corner in the shadow Cabinet, I hope that he will take back this message with the urgency that we shall deploy in today's debate to show the importance of having both the political and intellectual courage to begin a debate on full employment.

The issue of the wasted opportunity of our presidency of the European Community has been raised, but our presidency is not yet over. The summit at Edinburgh has yet to take place and it is not impossible for the British Government to start to give a lead in showing what is necessary if we are to return to full employment. We cannot have full employment in one country; we must have full employment in surrounding countries, too. To achieve that, we must acknowledge the power structure in Europe.

Given that the Government are usually realistic about power politics, I am surprised that they seem unable to acknowledge the power structure in Europe. Both Front-Bench teams wish to link this country to a Europe dominated by a super-power. Ever since men and women have formed tribes, let alone nation states, no tribe or nation state has willingly surrendered sovereignty to weaker groups around it. The starting point for our policies must be the power-house that Germany represents in Europe.

We should give up our extraordinary attempts to blame the Bundesbank for defending German interests—it would be surprising if it did not. We must accept that policy in Europe must be shaped by acknowledging Germany's power structure in the Community. Therefore, if we were seriously thinking about the importance of the German economy and of the Bundesbank reducing interest rates, the autumn statement would have broken ground and talked about the autumn statement for Europe. It would have mentioned, not merely public investment here, but what could be done by the Community to promote European investment into former East Germany. If we could lower the burden that is falling on former West Germany, we could restart the motor force in Germany, reduce interest rates in the Bundesbank and benefit from the results.

One idea to take to Edinburgh at the weekend is that the British Prime Minister can provide leadership, and we can begin to think about forming a full employment policy in Europe. However, in order to do so we must start by considering the power structure in Europe—centred around Germany.

Another idea that we could take to the summit would be to look at the markets beyond Germany—those countries that have traditionally bought from this country—and press for a Marshall aid plan for central Europe and beyond, not just on humanitarian grounds, although it is important enough to ensure that people do not starve, but to ensure that those countries have enough money to buy goods. They will use that money to buy from markets from which they have traditionally bought—this country and western Europe. We can provide leadership to the western world on the scope of the Marshall aid plan for central Europe and beyond.

We should not stand on our dignity but try to learn from what other countries and their constituent parts are doing to try to achieve full employment. In another debate in the House last week I was able to mention that German trade unions are not discussing a wage or salary freeze, but have something much more important on the agenda. They are beginning to discuss, both among themselves and with German employers, what the employers' response would be if the unions held back on wage increases and productivity increases were used, not to bring wage increases, but to expand the job base. That is an important idea which should commend itself to us, particularly given its source—a German trade union movement that is keen on success.

We could give to Europe an idea that worked well in the 1930s in this country. When the then Government felt that unemployment was almost overwhelming the country, they said that they were prepared to go back to the drawing board, and they asked for ideas about how to return to full employment. They set up the Economic Advisory Committee so that those with ideas could advance them for use in the Government's scheme and the public debate.

We learnt yesterday that the Chancellor of the Exchequer has a small group of economists who are to advise him on whether his predictions for growth are right. I hope that the Government will build on that modest proposal, admit that the challenge is defeating them and that they are prepared to open their doors to reasonable discussion as they are anxious to learn. I hope that the Government will admit that the old ideas that they thought acted as their map and compass as they went about daily life can no longer be used as their means of steerage. They need a new language to encapsulate the new ideas if they are to achieve full employment.

Photo of Mr Ralph Howell Mr Ralph Howell , North Norfolk

The hon. Gentleman talked about new ideas and I agree with much of what he has said. However, I disagree with him when he talks about full employment. He seems to suggest that if we have better management—whether by one party or another—we can achieve full employment, but that is not on. We need a fundamental rethink greater than the one we had when Beveridge introduced his report 50 years ago. Would the hon. Gentleman support the idea of establishing the right to work? Until we get down to that, there is no way that we can achieve the full employment of which he talks.

Photo of Frank Field Frank Field , Birkenhead

Labour Members used to introduce a right-to-work Bill every year. Therefore, I have no difficulty in accepting the hon. Gentleman's argument. The other issue that he raised reflected the tenor of my speech. If we are to return full employment to the agenda, as my hon. Friend the Member for Holborn and St. Pancras said that the Labour party should, we must not allow ourselves to be laughed out of court by people stating that it was a fluke of history in the 1940s and 1950s. We must think new thoughts in order to achieve our objective. The debate will be difficult and tortuous, and people will accuse us of disloyalty and misrepresent what we say, but unless we start that debate—and do so in the Chamber—we shall misrepresent the views of the growing number of unemployed people outside the House. It is their views that we should bring to today's debate.

Photo of Mr Peter Thurnham Mr Peter Thurnham , Bolton North East

I apologise for missing the opening moments of the hon. Gentleman's speech. Before talking about the Bundesbank looking after its own interests, he said that the first task was to wrest from VSEL the title deeds to the yard. I appreciate the importance of the Cammell Laird shipyard to his constituency and to the north-west, but surely VSEL owes a duty not only to its shareholders but to its other employees based at Barrow? I do not see how the hon. Gentleman can expect Laird to ignore the £20 million of liabilities that it incurred along with the purchase of the yard for a nominal sum of £1 and to present that as a dowry to his constituents, given these other responsibilities. It is important to the economy of the north-west that the great skills of the work force at Cammell Laird be used to the benefit of the whole economy, but I find it difficult to see how the hon. Gentleman can expect the shareholders and other employees of VSEL to make this sort of sacrifice just for his constituents.

Photo of Frank Field Frank Field , Birkenhead

The House has been tolerant and has allowed me a great deal of time to develop my ideas, but it would take me just as long again to answer the hon. Gentleman's points. All I can say is that, if he wants answers, he had better watch this space. Answers will be given to his important points—they will not be brushed under the carpet.

I repeat the sheer folly of our believing that we can sit idly by while a death sentence is handed down to one of our most important skill centres. Of course there are balances to be struck, and VSEL has certain duties. The Members who represent the constituencies in question have to push those matters; they are not my responsibility.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

I always listen carefully to the hon. Gentleman's speeches or read them when I have the opportunity. He is held in high regard on both sides of the House, but I must tell him, not in a carping way, that, having listened to the speech by the hon. Member for Holborn and St. Pancras (Mr. Dobson) and the speech by him, I have not heard a single proposal on how full employment might be achieved. All we have heard are calls for debates and for listening to people. We should like to hear the specific actions that the hon. Gentleman wants the Government to take. He will find an audience which is more than willing to consider positive proposals.

Photo of Frank Field Frank Field , Birkenhead

I almost despair of my ability to put a message across clearly. I have said that we have to think in a European context; we cannot think of Britain as an island unto itself—at least, when it comes to employment policies. I have also said that it is crucial that the Government have the European canvas on which to paint during their presidency. That presidency is not yet at an end.

I have also put forward two proposals which would give us, if not magically full employment, then the building blocks to begin the process of reaching full employment. The first point was that, given the transitional problems that Germany has gone through since unification, it will naturally put its own economic interests before the wider economic interests of Europe. Secondly, I argued that since Germany is such a powerful and dominant economy in Europe, it is in our interest that it should make the transition successfully. I said, thirdly, that it would have been sensible, to move Europe back to full employment, if we had spent the past six months thinking of measures to help the German economy make the transition. The resources of a wider Europe might have been deployed to that end. Just discussing such measures might have brought about a different attitude on the part of the German Government and Bundesbank.

I also spoke about what used to be our big markets in central Europe—they are now largely drying up for lack of finance. I proposed thinking about a Marshall aid plan on as imaginative a scale as the Americans offered western Europe after the second world war. I said that we should bring in such a plan for humanitarian reasons and for sound economic reasons.

In what I had hoped would be a 10-minute contribution I have not managed to set the world to rights or been able to tell the House all the necessary policy measures to move us back to full employment, but I did want to register the point that this is the first time I have ever heard our Front-Bench spokesmen use the phrase "full employment" to signify one of our objectives. I do not mean to downgrade what my hon. Friend the Member for Holborn and St. Pancras said, but it is easier to say the phrase than to work out policies to achieve it. That is what we must now do.

It would be a mockery if the hon. Member for Birkenhead, speaking about the need to return to full employment, did not end on the note where he began—the possible destruction of yet more jobs at Cammell Laird. I hope that I have convinced the House and others who may be listening outside it that we are utterly serious in our campaign to get the title deeds back and to find the money to ensure that Laird has a future until such time as this House takes a more relaxed view of debates on returning to full employment.

Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield 6:45 pm, 8th December 1992

The hon. Member for Birkenhead (Mr. Field) spoke with characteristic passion about the plight of his constituents who are to be made redundant by Cammell Laird. It is natural in such circumstances to look for political solutions. I know nothing about the title deeds or the other details, but the hon. Gentleman also talked about wider issues, including economic policy in a European context. He seemed to suggest that we might have done more to help the Germans through a difficult transitional period. My guess is that most British voters would probably feel that they had already done enough, given the high interest rates that we have had to put up with for the past couple of years, largely as a result of German reunification. Those rates were not anticipated by those of us who supported Britain's entry into the exchange rate mechanism in October 1990, but they became painfully more clear as the months passed.

It is tempting to assume that there must be some kind of a political solution, and politicians themselves are occasionally guilty of giving voters the impression that there must be some kind of political solution. But huge changes have been taking place for several years in European economies, and my guess is that the change at Cammell Laird is one of those. I know nothing about the yard's order books, but I do know that if a business runs out of orders it does not matter how much finance is put into it: if it cannot generate sales or orders, in the end it is not a viable business. People would be better off accepting that fact and not despairing. They should look at the examples provided by the areas of Britain which have been through this trauma before.

My hon. Friend the Member for Corby (Mr. Powell) has been a constant advocate of the interests of Corby town, which went through the same sort of trauma because it depended heavily on the steel industry. Today it has diversified into many other industries, and I see no reason why Merseyside should not do the same. I know that there is a feeling that Members who represent southern constituencies do not understand the problems of Merseyside, but six or seven years ago I visited Merseyside at the invitation of its churches to see for myself. I have also been there many other times because when I worked in industry I travelled all over the country. Once I even got up at 7 am to address a group of dockers on the options available to them under the Social Security Act 1975. They asked me, "Why are you coming here, guy? You're the bloke who's supposed to know about pensions." We were consulting the work force as we were required to by the legislation.

Photo of Andrew Miller Andrew Miller , Ellesmere Port and Neston

Does not the hon. Gentleman appreciate the difference between this and previous recessions? It is not that smoke-stack industries are being wiped out; highly skilled jobs which are an integral part of a successful economy are being lost. I recently spoke in the House about similar job losses in British Nuclear Fuels Limited, where some of the most skilled engineers in the north-west have lost their jobs. My hon. Friend the Member for Birkenhead (Mr. Field) has mentioned a similar group. Recently I made a speech about Shell workers. All these workers hold highly skilled jobs, and the comparison with Corby no longer holds good.

Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield

My impression was that those working in the steel industry at Corby were also highly skilled people and the sad fact is that, however much training we may have, if there is no demand for those skills we have to consider ways in which we can adapt. That is a harsh fact, but because of the pace of economic change there may be a need to persuade people of the need to change in mid career. That is not easy to do. I am the first to accept that but it is the current situation. I mentioned Corby as one example but there are many other examples. South Wales is an area highly dependent on industries such as steel and coal. Today, through the successes of the Government in attracting inward investment, the area has diversified hugely to the point where it has lower unemployment than Greater London.

Photo of Mr Llew Smith Mr Llew Smith , Blaenau Gwent

Will the hon. Member comment on the report recently published by the University of Wales which commented on Government plans to regenerate south Wales, particularly the valleys initiative? That report came to the conclusion that it was little more than a publicity stunt and that not one penny of new money could be found. We who live and work in such communities know that the jobs attracted did not replace those in coal and steel but were very often low paid, part time and almost inevitably non-union. Has the hon. Member read that report and, if so, will he comment on it?

Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield

No. I have not read the report to which the hon. Member for Blaenau Gwent (Mr. Smith) refers, but I stick to my assertion that unemployment in Wales is now lower than it is in Greater London and that Wales and the Welsh Development Agency have been successful in attracting inward investment.

Photo of Frank Field Frank Field , Birkenhead

Does the hon. Gentleman not think that the form of intervention we have seen in Wales is the type of interventionist policy that should be seen in the rest of the country?

Photo of Mr Llew Smith Mr Llew Smith , Blaenau Gwent

There may be a case for that kind of intervention elsewhere. The Welsh Development Agency and the Scottish Development Agency have both been successes and if other regions would benefit from that kind of policy I would certainly support that.

I want to make some comments about the European scene. We have heard much about the need to have some kind of integrated European policy but at present, far from the economies of Europe coming together, they are diverging in the way that they are developing and it is noteworthy that at present the German economy, which is often held up in this House as a great example of success, is moving into recession and German manufacturing industry finds itself in a very difficult position because it is not easy for employers to make the adjustments—the reductions in their labour force—which they may need to make. They are saddled with very high industrial costs. The result of this is striking because motor manufacturers in Germany are now looking outside that country to obtain their components. One of the most important side effects of Japanese inward investment in this country is that not only have the Japanese brought new standards of management and higher productivity to the companies in which they have invested, but they have insisted on much higher standards from their suppliers. We now see companies like Turner and Newall and GKN reaching new standards of quality.

There was a story in the Financial Times in October which said: Mercedes Benz, the German car manufacturer, says sterling is undervalued and the British economy underrated. The company nearly trebled its purchases of UK-produced motor components last year and expects them to grow further. Two other German companies, BMW and the Volkswagen/Audi group—now embracing SEAT of Spain and Skoda of Czechoslovakia—are also expanding their purchasing of components made in the UK and say they, too, expect further growth. All three say this growth would take place even without the devaluation of sterling following its withdrawal from the European exchange rate mechanism last month". This is a remarkable transformation for the British motoring industry, and for the British motor components industry, and if we continue with this record of success we shall find, for the first time for many years, that in 1995 we shall have a positive balance of trade in motor cars and motor components.

There are other reasons why investors now see this as a more secure and more stable environment.

The hon. Member for Holborn and St. Pancras (Mr. Dobson) talked about the rise of extremist parties and referred to Spain, Italy, Germany and France but notably, he did not refer to the United Kingdom. The simple reason is that we have policies designed to ensure that we have good community relations—as we have—because we have had tough immigration policies for many years. I do not think the picture that has been painted by some hon. Members is as gloomy as some would suggest.

My hon. Friend the Member for Chesham and Amersham (Mrs. Gillan) said that this was not a one-way street. Many jobs are being lost but at the same time many jobs are being created and my right hon. Friend the Secretary of State referred to the remarkable story that appeared last week about the MSF. That union has done a double U-turn and has not just signed with a Japanese company but signed a no-strike agreement with a Japanese company and both those policies were anathema to MSF only 12 months ago. The good thing is that its decisions will lead to the creation of 400 new jobs in Mansfield in Nottinghamshire and I am sure that the hon. Member for Mansfield (Mr. Meale) will welcome that, as will other hon. Members.

It is good news because it is inward investment and it is coming from Japan, Germany and the United States. I would like the very welcome policies set out in the autumn statement reinforced by a further assertion of the importance of manufacturing to the United Kingdom because if I have one regret about the 1980s it is that the impression somehow got around—I am not sure who was responsible and there is not much point in pointing the finger in a particular direction—that manufacturing was unimportant. We should make it clear that that is not our view; that manufacturing is important, and that we welcome the establishment by the Confederation of British Industry of the National Manufacturing Council; that we hope that the Government will look very carefully at the recommendations addressed to them—only a third of the recommendations are, since many are addressed to manufacturers or the City.

I would like to see the appointment of a Minister for manufacturing industry to make clear that the Government are totally committed. The CBI report underlines the importance of manufacturing. Although the hon. Member for Holborn and St. Pancras said that there were 4·5 million people in manufacturing, the report suggests that the figure is 5 million and that another 5 million are dependent on manufacturing. It is important to this country. It is still a great trading nation and manufactures are largely traded. We have had some remarkable successes over the 1980s, with 50 per cent. of consumer spending being on manufactured goods and 70 per cent. of exports being manufactured, while £7 billion of corporation tax is paid by manufacturing industry.

The record over the past 10 years has been remarkable because productivity in manufacturing has risen by 58 per cent. and, contrary to what the hon. Member for Holborn and St. Pancras asserted, that Britain's share of world trade is continuing to fall, according to the CBI, the United Kingdom's share of main manufacturing countries' exports has risen from a low of 7·6 per cent. in 1985 to 8·7 per cent. in 1991. There is a good story to tell on manufacturing exports. Even throughout the recession exports have continued to grow and manufacturing productivity, according to the CBI report, even over the past 12 months, has grown at twice the speed at which it has grown in Germany. There is a great deal of catching up to do and that is why it is important to place a new emphasis on the importance of manufacturing.

If we do, we shall see a resurgence of economic activity in manufacturing and a growth in jobs—which is what everyone wants. There is a new emphasis on growth. The hon. Member for Birkenhead wants full employment. We shall achieve that only if we have an industry that is competitive and has high productivity. Ironically, sometimes that will mean the loss of jobs, as companies invest and displace jobs—but it is the only way. There will then be more jobs in the service industries that depend on manufacturing. We will create full employment by having low interest rates, low inflation, and high productivity. That is what I would like to see, and I am sure that most right hon. and hon. Members support that.

7 pm

Photo of Mr Ron Leighton Mr Ron Leighton , Newham North East

We hear every day of hundreds or thousands of new redundancies. The whole country is submerged under a tidal wave of unemployment. The Government do not have a clue what to do, and neither do they care. That was graphically shown recently when Ministers blithely and abruptly announced the colliery closures to the House. An extra 100,000 people were to lose their jobs without any consultation, even with the Department of Employment. The Government apparently proposed to blight the lives of 100,000 people and to throw them on the scrap heap, at a time of multi-million unemployment on a rising trend. The Government's solution was to pour petrol on the flames.

The Government seemed surprised that the vast majority of the British public recoiled, were shocked by, and protested at that decision. Perhaps that is explained by the fact that the Conservatives have been in office for so long that they think that they can do anything they like.

We now have close on 3 million unemployed claimants. Horrendous and scandalous though that figure is, it is a gross understatement. The statistics have been massaged and fiddled, and on a 1979 basis the figure is more like 4 million. A Department of Employment press release issued on 12 November recorded an increase of 391,000 claimants over the previous 12 months, but a 658,000 decrease in the employed work force. Therefore, hundreds of thousands of those thrown out of work do not show up in the official statistics—and many of them are women.

It is self-evident that we can never have a good and decent society that is at ease with itself, and a country that functions properly, with mass unemployment. We will never have a proper welfare state with mass unemployment, because we could not afford one. The cost of the dole queue is ruining public finances. Each unemployed person costs the Exchequer about £9,000. At a time when the Government's revenue is being slashed by the recession, they will soon have to pay about £30 billion to finance unemployment. That is why they are borrowing tens of billions of pounds every year—not to invest, but to pour down the black hole of unemployment.

A good society and a country at ease with itself is one in which everyone who wants to work can work and is properly paid for doing so. Why is that not possible? After 13 years of Conservative rule, we have a vile and unjust society of mass unemployment. The Government say that our social system has no use for millions of our countrymen and women—that they are surplus to requirements and will be discarded and thrown on the scrap heap. Their lives will be blighted by misery and suffering through no fault of their own, but because, we are told, our country has no use for them and there are no opportunities for them to work. Such a society is immoral, and a Government who tolerate it should be turned out.

Exactly 100 years ago Newham, in the east end of London, elected and sent to the House of Commons the first Labour Member of Parliament, Keir Hardie. In his maiden speech on 7 February 1893—and I doubt whether it would be allowed today—he moved an amendment to the Loyal Address, in which he made a moving and passionate attack on the evils of unemployment and on the poverty, hardship, and moral degradation that often followed unemployment in those days. He said: There is no more pitiable spectacle in the world than the man willing to work who, day after day, vainly 'begs a brother of the earth, To give him leave to toil'."—[Official Report,7 February 1893; Vol. 8, c. 730.] In the century that has intervened since Hardie uttered those words, many things have changed and improved, but one evil that we thought had been vanquished has been brought back by the Government—the evil of mass unemployment.

There were no statistics in Hardie's day, but he estimated that 10 per cent. of the working population were unemployed. In Newham today, there are 20,000 unemployed, which is equal to 20 per cent. of its potential working population—which is twice as bad as in Hardie's day. What a commentary that is on 13 years of Conservative government.

We are dealing with not just statistics but human beings. Each human being thrown out of work represents an acute personal crisis, with the loss of the individual's confidence, identity, and self-esteem. A person is largely what he does, and if he does nothing, he begins to think that he is nothing. Soon, the anxieties, debt, despair, humiliation, and social and domestic problems pile up. The individual may find that he is threatened with homelessness. He soon realises how fragile was his previous comfortable existence, and that it depended on his wages or salary—and that once they were taken away he had nothing left.

The individual will soon learn also of society's prejudices—of the people who think that there is plenty of work if one is willing to do it, or that there is something wrong with anyone who remains unemployed for any length of time. His self-esteem suffers, and the frustrations, pressures and tensions are so easily brought home to the family. That often leads to marriage breakdowns. Unemployment today is the main cause of poverty and social ills—of home repossessions, divorce, suicide, ill-health and crime.

One person who has spoken most movingly about unemployment is the Prime Minister, who told us how he was unemployed for nine months at the age of 19. He received unemployment benefit of £2.17s.6d a week, but the unemployment pay of a man and wife with two children is 40 per cent. less today in real terms. However, the Chancellor of the Exchequer said that that is a price well worth paying.

I want to mention crime. The Conservatives were largely elected on a law-and-order ticket, but since they have been in power crime has doubled. That is the fault not of the police but the Government, who have destroyed the hopes and livelihoods of millions of people. Senior police officers know that rising crime is linked to rising deprivation. In his final report as Commissioner of Police of the Metropolis, Sir Peter Imbert stated; The notion that there is a link between crime and social deprivation is a compelling one. Any Conservative Member who pretends that is not so must ask why there is more crime in deprived areas and why, as deprivation has increased under this Government over the past 13 years, crime increased. Anyone who doubts the truth of that should ask insurance companies, who know that crime rates are higher in deprived areas, which leads them to charge higher premiums there.

Every year 400,000 young people leave school. One quarter of those, 100,000, will join those who have never had a job; they are without work, and the 16 to 17-year-olds are without benefits as well and many are even without a training place. They live on estates with unemployment at levels of 20, 30, 40 or 50 per cent. Children are being born into families who have never been to work, where the parents have never had a job. These are people with no hope, no money, no prospects, no stake in our society; they are shut out and owing nothing to our society, completely alienated. They are people with no escape from their plight. They are people who never have a holiday. The nearest thing they have to a holiday is taking part in a riot or joyriding.

What stops people committing crime is not the police; it is what might be called social control—concern about what other people, in particular people at work, will think. But what if they do not have a job, what if they have never had a job, what if they are never likely to have a job? Then, what the hell, what does it matter? That is why crime has doubled in the period of office of this Government. That should be recognised.

Some people ask what happened in the 1930s when there was mass unemployment but not rising crime. There was a perception then that everybody was in the same boat. Then, no one had a car, no one had a television set; there was a commonality of poverty. Now, however, people live in areas surrounded by streets full of cars, surrounded by people who have holidays and houses full of consumer goods, but they are shut out.

Kenneth Newman spoke in 1987 about the volatile vapour of social discontent hanging over the city, looking for a spark to set it off. In those circumstances, it is completely unrealistic to expect the police to screw down the lid. That is why we have the doubling of crime, because we have the huge increase in unemployment. It is pointless to deny that.

The Government must face their responsibilities and set a priority to full employment—and I am extremely pleased to see my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) on the Front Bench. This cannot be left to the market. We have a market failure in Britain. We need public action. If we look around our towns and cities today, we see that there is work that needs to be done. We need something like Roosevelt's New Deal. During the war we had full employment to produce weapons of destruction. Is it really beyond our wit to bring about full employment now, to make the things that we need so desperately in the country at the moment?

We need a counter-cyclical boost of public expenditure to aid recovery. We should be encouraging that across Europe, if possible. But what do we have? I am closing on this note, because the European dimension has been raised by a number of hon. Members. We have the outdated and outmoded Maastricht treaty, the whole thrust of which is deflationary. It ordains huge cuts in public expenditure right across Europe.

If we in Britain were to get our public borrowing requirement down to 3 per cent. of gross domestic product as the treaty ordains, we should have to make cuts of £20 million, prolonging and deepening the recession. So I trust that when the Bill is in Committee we shall have a full examination of the employment effects of the treaty and that this matter will be fully dealt with, because in my view a strategy to bring back full employment will entail junking the Maastricht treaty.

Photo of Mr Barry Legg Mr Barry Legg , Milton Keynes South West 7:13 pm, 8th December 1992

We have had a wide-ranging debate this evening and a lot of unanswered questions are still to be addressed. A number of Opposition Members have referred back to halcyon days in the 1950s and 1960s when they left school and there was full employment. They seemed to be searching for the holy grail that will take us back to those times. They have talked about full employment, and if we look at the periods of great economic success that the world has experienced, we see that the first requirement for prosperity, success and growth of employment is growth in trade. That is particularly what we had during the 1950s and 1960s.

I am pleased that Britain is taking a lead in Europe on the issue of trade, and particularly on the GATT round, because addressing that problem and sorting it out will be of great benefit not only to Britain and Europe, but to the world as a whole. Growth in world trade will deliver prosperity and jobs.

The other important factor that needs to be taken into account in considering how to generate jobs, wealth and stability is productivity. We hear very little about productivity from the Opposition Benches. If we look at the successful economies in the world, we see that the economies that are gaining strength, a greater share of world trade, greater employment and prosperity are those that are achieving gains in productivity.

The world has been through a very difficult recession. Britain has experienced a difficult recession, which it is now coming out of, and I shall be saying more about that later.

We have just seen some very good figures from the United States on growth and employment. In the United States, unemployment has just fallen from 7·4 to 7·2 per cent. and 100,000 new jobs have been created in the last month. What do we find lying behind that growth in employment and that success in the United States? We find two things. The first is monetary easing and lower interest rates. Over the past 18 months the Americans have steadily reduced their interest rates and that has given their consumers another $65 billion to spend, because that is the amount of money they would otherwise be spending on servicing domestic debt.

We have seen from Her Majesty's Government in the last few months welcome reductions in interest rates, which will help to provide a similar boost here in the United Kingdom.

The second factor in growth in employment in America is the very good figures on productivity growth and unit labour costs. In the past year, unit labour costs in the United States have risen by 0·5 per cent., the best record in the last nine years.

That is the sort of growth in productivity that we need in this country. Furthermore, reducing labour costs is not a route to poverty, as one might think from listening to some Opposition Members, but a route to wealth. At the same time as the United States produces figures showing how well it is containing labour costs, other figures show that income in the United States has risen by 1 per cent. in one month. Those are some of the trends that we need to see in the British economy to carry forward our recovery here.

Again, we see that the successful economies in the Far East are taking a greater share of world trade and their people are becoming more prosperous. Looking at the underlying reasons, we find that those are deregulated economies in which the price of labour is very competitive.

If we move back to the European scene, we find that Europe as a whole, particularly continental Europe, has not done very well over the past decade in terms of world trade. In the past seven years, Europe's share of world trade has declined by some 7 per cent. Some very worrying trends are apparent in the structure of labour costs, particularly in Germany, to which the hon. Member for Birkenhead (Mr. Field) referred earlier. Nearly 50 per cent. of German labour costs are now accounted for by non-wage costs. They are accounted for by social costs, and the German economy has been becoming more and more uncompetitive. In Germany, the average hourly labour cost is currently running at about $21; in Britain, it is running at about $12. We have achieved that significant gain by avoiding the heavy social costs that Opposition Members are only too keen for us to sign up to, in the form of the social chapter.

We can take a lead in Europe, on GATT and on the social chapter. We should encourage our European partners not to opt for a route that, rather than improving employee welfare, will spread poverty and unemployment. Let us examine the unemployment records of some continental countries. In Germany, unemployment is rising rapidly: 50,000 more people were made unemployed there last month, and some 3 million are currently unemployed. That figure is far too large. In France, some 2·9 million are unemployed; in Italy, the figure is about 2·8 million. In Spain, some 17 per cent. of people are unemployed, while the figure is nearly 20 per cent. in Ireland.

The figures for unemployment among people under the age of 25 are even more horrifying. In France, the rate is 21 per cent.; in Italy, it is 28 per cent.; in Spain, it is 31 per cent. Those are damaging figures, and I think that they have some bearing on the remarks about the growth in extremism that were made earlier by the hon. Member for Holborn and St. Pancras (Mr. Dobson).

The economies that I have mentioned are experiencing a number of problems. Europe has not had an easy time over the past two years, but France, Italy and Spain all operate a minimum wage policy. The Labour party thinks that such a policy would benefit Britain, but minimum wage policies do not help the people at the bottom—they hurt them by keeping them out of work. Employers do not want to take on people whose skills are not as great as those of other workers, and they do not want to take on people who will need training. If they take on such people, they do not want to pay them more than the market rate. A minimum wage policy would in fact produce more unemployment, as the Labour party knows only too well.

None of the recipes cited by Opposition Members, today and on other occasions, will help employment; on the contrary, they will increase unemployment. I shall wait with interest to see how Labour will develop the policy of full employment that the hon. Member for Holborn and St. Pancras had the audacity to mention today.

My constituency, like many others, has had a difficult time during the recession. Opposition Members tend to come up with figures relating to job losses, doom and disaster, but, despite the difficulties experienced by my constituency, I intend to highlight some of the good things that are happening in Milton Keynes, which is a typical English town. In the past 12 months, some 6,515 new jobs have been created there. That will not capture the headlines in the national newspapers, as did the announcement of the loss of 15,000 Post Office jobs over five years through natural wastage, because it is essentially the result of small, successful local businesses expanding their work forces.

In the past year, 222 new working establishments have been started in Milton Keynes. That, too, will fail to make the headlines, but it is all about extra jobs. Milton Keynes has a diversified economy: we are very dependent on small businesses, which make up about 65 per cent. of our economy. Those small businesses are succeeding and taking on new employees, although I concede that times are difficult.

Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Work and Pensions

Will the hon. Gentleman confirm that unemployment in Milton Keynes has trebled in the past two years?

Photo of Mr Barry Legg Mr Barry Legg , Milton Keynes South West

As I said earlier, Milton Keynes has had a difficult time. I could have concentrated on the fact that unemployment in Milton Keynes has risen from 3 to 8 per cent. over the past two years; I could have detailed the job losses there. Instead, I recognised that Britain is now coming out of recession. Unemployment is a lagging indicator of recession. The hon. Member for Holborn and St. Pancras will be interested to learn that unemployment in Milton Keynes has now flattened out, settling at 8 per cent. We are creating new jobs, and Milton Keynes—like the rest of Britain—will go forward under the Conservatives.

Photo of David Hanson David Hanson , Delyn 7:26 pm, 8th December 1992

As hon. Members will expect, I shall not follow the line of route initiated by the hon. Member for Milton Keynes, South-West (Mr. Legg). Unlike Conservative Members, Opposition Members fully support the minimum wage policy, and we are proud to have fought the last election on that basis; when the opportunity arises, we will introduce the minimum wage in the interest of justice and fairness. Sadly, the motion sums up all that the Opposition consider relevant about the current level of unemployment. At least we believe that it offers a glimmer of hope to the millions of people who are unemployed.

Having sat through the debate since 3.30 pm, I have been particularly struck by the staggering complacency of Conservative Members. They have not accepted an iota of the Opposition's argument that we face a national crisis in manufacturing employment, and that action should be taken at a national level, with the Government accepting responsibility for generating investment, wealth and creating jobs. That abdication of responsibility is one of the strangest aspects of the debate.

It may have escaped the notice of Conservative Members that, since the Prime Minister took office about two years ago, 1·1 million people have lost their jobs. Every day since then, 2,500 people have become unemployed. I am not here to doom-monger—I want to talk positively—but when 29 people are chasing every job vacancy, Government action is clearly needed.

What do we get from the Government? We have had a Gracious Speech and an autumn statement, which addressed the wrong issues; we have rail privatisation and coal privatisation; we have the abolition of the basic floor provided by wages councils; we have reductions in Government spending; we have the opting out of schools; we have tinkering with investment on the edges of the economy. We do not have a Government who are committed to the central agenda of creating employment and improving the lot of the millions—both Labour and Conservative voters—who want a better Britain to be provided through job creation.

I sometimes think that the Government are not living in the real world. I do not claim that my constituency is the worst affected in Wales or in the United Kingdom. Indeed, there are many good things in my constituency, and I would be the last person to run down Delyn. It has many factories which are creating wealth, employment and jobs. However, it would be foolish of me to ignore the fact that much has gone wrong in my constituency, which needs support from and action by the Government to promote employment.

In October there were 5,971 unemployed men and 1,641 unemployed women in the Shotton, Flint and Rhyl travel-to-work area which encompasses my constituency and that of my hon. Friend the Member for Alyn and Deeside (Mr. Jones). Those figures represent a 9 per cent. unemployment rate in my constituency and a rate of 10·5 per cent. in Clwyd. My hon. Friend the Member for Alyn and Deeside is as concerned as I am about the level of unemployment in that travel-to-work area. I shall shortly discuss some of our proposals to help reduce those figures.

Photo of Mr Barry Jones Mr Barry Jones , Alyn and Deeside

My constituency shares boundaries with that of my hon. Friend. Today we heard that Northwest Airlines said that it would abandon its order for 74 airbus aircraft. Like me, my hon. Friend might want to know the consequences of the loss of that order for the British aerospace industry and for the 4,000 people employed at the Broughton works in my constituency where the airbus wings are made. Does my hon. Friend agree that the Government should aim to put at the top of their agenda measures to help British manufacturing industry?

Photo of David Hanson David Hanson , Delyn

I fully agree with my hon. Friend. I recently visited the aerospace works in his constituency because many of the workers are my constituents. They are crying out for an aerospace strategy to help create jobs and employment. Today's news that the airbus order might be cancelled is of particular concern to my part of north-east Wales.

In the Delyn borough council area there are 2,283 people out of work. In some of the wards in my constituency, 40 per cent. of males are unemployed. This is the 30th consecutive month in which unemployment has risen in Delyn constituency, where the total number of unemployed is 2,806. Although that is not the greatest number in Wales, it means that 2,806 people want to work and deserve the opportunity to do so. Government support could create valuable jobs.

In my constituency only 416 job vacancies are currently registered and in Flint—the largest town in the borough of Delyn—only 45 vacancies are registered with the jobcentre. With such a level of unemployment and lack of vacancies, we need solid action by the Government.

I draw again to Ministers' attention a fact that has been mentioned by many of my colleagues. It costs £9,000 to keep a person unemployed. That means that taxpayers in Delyn are spending £25 million this year on wasteful unemployment when we could undertake many projects to create wealth and jobs and to build a better society. The hon. Member for Chesham and Amersham (Mrs. Gillan), who is no longer present, said that public money does not create wealth, but many employers and business people in my constituency would welcome portions of that £25 million being spent in the private sector to provide the services that we need and to retain private sector jobs.

On Friday I attended a business lunch in Mold in my constituency with business men, none of whom, I suspect, voted for me in the general election but all of whom stated categorically that the Government were off the track and were not providing the necessary resources for the private sector through public investment. Most of all, they wanted public sector investment to help create private sector jobs. What do my constituents have to look forward to? Unfortunately, the answer, as for the rest of the United Kingdom, is, "Not a great deal".

Although the issue of travel-to-work areas is not part of the Minister's responsibility, I wish to raise it now. As my hon. Friend the Member for Alyn and Deeside is aware, the Flint, Shotton and Rhyl travel-to-work area, which has been in operation since 1984, is in the Government's proposed review. Deeside fears that the assisted area status, the accompanying Objective 2 status and the special development area status, which were put in place because of massive job losses in the steel and textile industries, will be lost when the review is completed.

There are still some of the 40 per cent. black spots in my constituency and along the coast which existed when the original Objective 2 status area was agreed. We also face the prospect of further job losses through colliery closures, which should add to the urgency with which the Government should tell north-east Wales that they believe. that its assisted area status should be maintained. The Minister is shaking his head. Does he disagree with that point, is he not especially interested, or is he doing his crossword? I and many colleagues believe that assisted area status is valuable to our community and, if it is not maintained after the review, we shall return to the previous level of unemployment. At the moment, the enterprise zone and assisted area status is due to be withdrawn. My hon. Friend the Member for Alyn and Deeside and I wish it to be continued.

It is absolutely amazing that the Government can consider such a step, especially as my constituency faces the closure of the Point of Ayr colliery in the north of my constituency. When discussing unemployment, we must mention the Government's responsibility to create jobs, as well as that of the private sector.

The Point of Ayr pit is perfectly viable. It sells 80 per cent. of its coal to a power station down the road and the other 20 per cent. to businesses on the Wirral in the constituency of the Secretary of State for Wales. It has a market for its coal, and hon. Members may wish to refer to early-day motion 970 which mentions the world-beating coal produced in that pit. However, we now face the potential loss of 527 direct jobs and a total of 1,047 jobs there because of Government policy. Closure is proposed despite recent investment in the pit and despite the fact that it has the ability to produce coal at competitive prices. It is an absolute scandal.

The colliery and its on-site contractors provide an immense resource for a local skill base. What surer way is there to continue unemployment and the downward cycle than to remove from the local economy a major skill base from my constituency and other affected areas?

The Secretary of State for Employment referred to the potential cost of retraining redundant miners. In Wales that cost is estimated at £2·6 million. That includes the retraining of miners who might lose their jobs at the Point of Ayr colliery. Would not it be better if that money were invested in the colliery to ensure its productivity and if we had a proper energy policy which ensured that coal had a valuable role?

Delyn borough council recently did some excellent work on estimating the cost of replacing the 1,000 jobs that would be lost if the Point of Ayr colliery were closed, although I hope that it will not come to that. The council estimated that about £150 million of taxpayers' money at a local level would be needed to replace those jobs. Do not hon. Members accept that it would be better to find positive ways in which the Government can spend the £150 million and to put jobs on the agenda instead of using those resources to respond to a closure which need not occur? Valuable resources have been invested in the pit in the past few years.

I am sure that my hon. Friend the Member for Blaenau Gwent (Mr. Smith) will mention south Wales if the opportunity arises. Bearing in mind all the problems facing my constituency and those of my colleagues, surely the Government could have tabled a better amendment than the waffle that they have produced. The Government are complacent about what is happening. Perhaps Ministers and Conservative hon. Members are not aware of what is happening outside the House. Many people who are natural Conservative supporters are suffering tremendously in the recession. They are looking to the House for leadership and for quality jobs.

Photo of Oliver Heald Oliver Heald , Hertfordshire North

The hon. Gentleman makes the point that people from all walks of life are suffering in the current recession. Does he agree that it is a Europe-wide problem and that the results of unemployment in this country are by no means the worst in Europe? The hon. Gentleman should consider the figures quoted by my hon. Friend the Member for Milton Keynes, South-West (Mr. Legg). In Spain, which has a minimum wage policy, the unemployment level for young people is 33·7 per cent. The hon. Gentleman will recall that figure. In a European context, what are your proposals for dealing with the problem——

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. I remind the hon. Gentleman that he should address me. His intervention has now gone on long enough.

Photo of David Hanson David Hanson , Delyn

I find it interesting that a Conservative Member asks an Opposition Member about Government policies and about what our position in Europe should be when Britain has the presidency of the European Community and when the Prime Minister has the opportunity to feed in policies. Perhaps the hon. Member for Hertfordshire, North (Mr. Heald) would care to speak to the Prime Minister and to ask him what his policies for Europe are. We shall ask that because we do not appear to be getting Government support or co-ordination on those points. We can discuss the minimum wage at another time. I regard the minimum wage as vital to our community and especially to Wales, which is the lowest-paid region in the United Kingdom.

Conservative Members have mentioned the depressing side of our arguments and the fact that we have concentrated on job losses. I want to be positive about our community. As I have said, Delyn has much to offer prospective employers, as does north Wales and especially north-east Wales. I should like to hear support from Conservative Members for our positive proposals for job creation. There is much that we need to do. I could cite a number of examples in my own constituency of things that could be done to create employment in Wales and elsewhere.

Let us consider transport. As I said, it would cost £150 million to replace the jobs that may be lost at Point of Ayr colliery. It would cost £40 million of Government money to improve the Crewe-Holyhead rail link. My hon. Friends from all parts of the United Kingdom could mention projects that would create employment, would help the infrastructure and would bring jobs and support, especially to north Wales. The third Dee crossing is a major road infrastructure project which is close to the heart of my hon. Friend the Member for Alyn and Deeside. It would create jobs, it would put construction workers back to work, it would get people off the dole and it would improve the infrastructure of north Wales. It is a valuable capital project.

The retention of Objective 2 area status for north Wales, including the Shotton, Rhyl and Flint travel-to-work area, is now entirely in the hands of the Government and of Conservative Members. The retention of that status would ensure, as it would in other parts of the United Kingdom, the retention of support to areas that have been hard hit since 1979 when the Government took office.

On energy policy, I make no apology for repeating the fact that my community is in dire need because the Government may close the Point of Ayr colliery. Many people's jobs depend on that colliery. It would be simple for the Government to make a statement and to consider a positive energy policy to help to reduce the burdens on the community.

An aerospace strategy has been mentioned, as has a tourism strategy which would support the parts of my constituency that depend on tourism. We need a housing strategy to put the many building workers in my constituency back to work and to help to meet the needs of the 2,650 people who are currently homeless in Delyn. All of those are positive policies that the Government could propose to help to create employment in the community. However, the Government choose not to do so which is a scar on their reputation and on Conservative Members who do not seek to invest in jobs in our community.

Our motion sums up our concern for jobs and for employment. The one message that I shall take back to my constituency at the weekend is the frightening level of complacency that Conservative Members who have spoken tonight have shown about our economy and about the level of jobs in our communities. Above all places in the United Kingdom, the House should say to people in our communities, "We know why you are suffering, we know how you are suffering, and we have a strategy to build our way to recovery." Conservative Members have shown that they have no strategy and no plans for recovery. That is why the Government will fail in clue course.

Photo of Mr Graham Riddick Mr Graham Riddick , Colne Valley 7:44 pm, 8th December 1992

One of the disappointing aspects of the debate has been the rather poor attendance of hon. Members of all parties. The hon. Member for Delyn (Mr. Hanson) should also take the message to his constituents that few of his hon. Friends bothered to turn up to listen to their own debate on unemployment. That is an indictment of the Labour party.

I can well understand that Labour Members did not turn up because they did not want to listen to the hon. Member for Holborn and St. Pancras (Mr. Dobson). That is fully understandable. However, it is a shame that we do not see more Labour Members present for such a debate.

The hon. Member for Delyn asked about the Government's European policy. One thing I know about Labour's policy on Europe is that it seeks to increase the money provided through the social fund and through the cohesion fund, which the Maastricht treaty seeks to introduce. The reality is that any extra funds that go into the two funds will find their way to the poorer, southern countries of the European Community rather than to the regions of this country. Labour Members should be slightly cautious about calling for more funds in those areas.

The hon. Member for Holborn and St. Pancras made a disappointing and poor speech. On three or four occasions, he responded to interventions by saying that we should have to wait until later in his speech and that he was not able to deal with interventions at that stage. He was rather insulting to the unemployed when he suggested that they would all commit crimes because they were unemployed. That comment was unfortunate.

The hon. Member for Holborn and St. Pancras talked about right-wing, fascist extremists. The reality is that there is a problem with right-wing, fascist extremists in Europe. They are not a problem in this country. They are a problem in Germany, in Italy and in France, but not in this country.

The only job creation scheme put forward by the Labour party which has ever worked is the one in Monklands district council where 22 wives, sons and daughters of a small group of Labour councillors have been employed. I ask Opposition Members when they will express sympathy for 51-year-old Tom McFarlane, who was made redundant because he and his wife dared to question the internal procedures of the local Labour party and its corrupt control of the local council. To date, we have heard nothing about that saga from the right hon. and learned Member for Monklands, East (Mr. Smith), the Leader of the Opposition. He has been totally silent. It is time that he put that right and it is time that he condemned the practices in Monklands district council.

Unemployment is a curse on our society: of that there is no doubt. All hon. Members accept that. Unemployment leads to all sorts of desperate difficulties for individuals who have lost their jobs and for their families. The strain that unemployment puts on families sometimes leads to the break-up of those families and sometimes even leads to people losing their homes. Conservative Members care about the real problems that face ordinary people—our constituents who become unemployed.

It is misleading to suggest that there is an easy answer to the difficulty. The quack solutions that we have heard from the Labour party today demonstrate why it was that the British people did not entrust Labour with government last April. The propositions put forward by the hon. Member for Holborn and St. Pancras were glib and facile on the whole, and demonstrated, once again, that the Labour party is wedded to state intervention as its preferred option. We heard that the Government must take action on jobs. The hon. Member for Delyn said that we need an industrial policy and a package of measures. However, Opposition Members never tell us how those measures are to be paid for.

So long as Labour advocates a national minimum wage and pushes for Britain to sign the European social chapter, Labour does not deserve to be taken seriously in respect of unemployment. Those two proposals would cost hundreds of thousands of our fellow citizens their jobs.

The scourge of unemployment will be tackled properly only when the process of wealth creation is set solidly on track. The fundamentals are what counts. For a year until golden Wednesday on 16 September, interest rates in this country were too high. They were at a level inappropriate to Britain's domestic requirements. We all know that that stemmed directly from Britain's membership of the exchange rate mechanism—a policy that was supported wholeheartedly by the Labour party. However, now that the Government have been able to reduce interest rates by three points to 7 per cent., British exporters are more able to sell their products overseas and a recovery will take place. The fundamental requirements for recovery are now in place.

I know that Ministers are wary of trumpeting recovery for fear of heralding a false storm once more. However, as a humble Back Bencher and a humble Parliamentary Private Secretary, I am prepared to stick my neck out and say that I believe that a good recovery will take place in 1993. I believe that it might be considerably stronger than the 1 per cent. forecast by my right hon. Friend the Chancellor of the Exchequer in the autumn statement.

Anecdotal evidence suggests that the recovery may already have started—at least in the north of England where people are less highly geared. Yorkshire folk are very sensible and canny and they did not borrow up to their eyeballs in the heady days of the 1980s. As they have fewer borrowing commitments, they will be able to take advantage of the lower mortgage repayments and of the favourable economic conditions that now exist.

I spoke recently to a medium-sized manufacturer based in Halifax who does a great deal of exporting. He told me that his order book has exploded since the devaluation of the pound. He has taken on a greatly increased number of orders and that is good news. He is also looking to employ people.

Only a week ago, I spoke to a stockbroker based in Huddersfield. He told me that he saw green shoots of recovery all over Yorkshire. I do not want to get carried away, but there are some encouraging signs. Some companies' order books are increasing and there is more confidence about the future.

I spoke to a friend of mine who sells furniture. He told me that his sales have increased markedly in Yorkshire and, funnily enough, particularly in the north-east of England. That anecdotal evidence, allied to figures showing the recent growth in the money supply and in retail sales, provides encouraging signs for the future.

Putting that evidence to one side, my real cause for optimism is that we now have in place the economic and monetary policies conducive to recovery. I believe that that recovery will take place. Recovery in the wealth—creating sectors will bring in its wake the new jobs that we all so desperately want to see. That will not come about through the quack solutions of the hon. Member for Holborn and St. Pancras, who advocates state intervention here and state spending there.

Between 1985 and 1990, unemployment fell by more than 1 million because of the new jobs being created in the real industrial world. We created the right economic conditions of low inflation, minimum regulation, moderate personal and corporate taxation, less of the nation's wealth being swallowed up by the state and a climate for enterprise. Those are the conditions that we will have to recreate—and which I believe that we are creating—for the 1990s. There are no facile, quack solutions.

The Labour party does not understand industry. Labour Members advocate that politicians should have a hands-on approach to industry and that politicians should have an industrial policy. However, the reality is that hardly any Labour Members have ever worked in industry. It is fair to point out that practically none of the spokesmen in the shadow Employment, Treasury or Trade and Industry teams have ever worked in industry.

I was interested to note from his biographical details that the hon. Member for Holborn and St. Pancras worked at the headquarters of the Central Electricity Generating Board for 10 years. That was certainly a nationalised industry in those days, but I am not sure what his job entailed. I suppose that it was at least close to industry so I must not denigrate it.

The fact that the hon. Member for Holborn and St. Pancras can refer to business men in this country as stinking, lousy, thieving, incompetent scum demonstrates his contempt for people who run businesses in this country.

Photo of Mr Graham Riddick Mr Graham Riddick , Colne Valley

The hon. Lady is now going to try to defend the indefensible.

Photo of Ms Joyce Quin Ms Joyce Quin , Gateshead East

Far from defending the indefensible, I would like to repeat the comments of my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson). He made it clear that he was referring to employers who pay poverty wages.

Photo of Mr Graham Riddick Mr Graham Riddick , Colne Valley

Whatever the circumstances, one should not refer to business men as stinking, lousy, thieving, incompetent scum". One simply does not do that, particularly if one claims to hold a responsible position within the shadow Cabinet as the hon. Member for Holborn and St. Pancras does. The comments of the hon. Member for Holborn and St. Pancras demonstrate his contempt for industry and for business in general. We hear that kind of approach from the Opposition far too often.

The negative knocking of industry by the Labour party achieves nothing and it certainly does not help to create a climate of confidence. We all know that confidence is terribly important. Out there in the real world confidence is fragile. The Labour party could help by being less negative and more positive about opportunities and about the future.

When companies make announcements about redundancies, that is also bad for confidence. It certainly does not help to restore confidence. Last week, the Post Office announced 16,500 job losses. When I heard that, I thought, "My God, that's appalling. That will be disastrous for confidence." However, when I read the small print in the newspapers the next day, I realised that the jobs were to be lost through natural wastage over five years.

The fact that those jobs are to be lost is regrettable. However, they are being lost not so much because of the recession, but because of improved technology which is being introduced in the Post Office. An interesting article by Anatole Kaletsky appeared in The Times on Monday. He pointed out that too many companies are making big redundancy announcements when they have no intention of losing so many people. He reported that there is a cult of management machismo. If that is the case, it is most unfortunate. Industrialists should stop making such announcements unless absolutely necessary.

Mr. Kaletsky pointed out that redundancy costs can often be reported as an 'extraordinary item' in a company's accounts and do not therefore affect the earnings per share from continuing operations". I understand that the practice will cease in the middle of next year—and about time, too.

The Government's economic policy is now on the right tracks. Interest rates have come down and inflation is low. The autumn statement responded to the representations of industry, contrary to many of the statements made from the Opposition Benches. Recovery is in sight arid with recovery will come renewed job opportunities. The small businesses will create the jobs of the future. The big companies are shedding jobs because of improved technology that they are introducing into their factories.

My old company, Coca Cola and Schweppes Beverages, is able to produce as many cans of pop by employing 200 people in its new factory in Wakefield as it took 1,800 people to produce only a few years ago. I do not particularly welcome that; it is simply a fact of life. It demonstrates the difficulty of creating new jobs in the United Kingdom. The small businesses will create new jobs, so we must create the right economic conditions in the United Kingdom. That is exactly what the Government are doing. The Labour party's quack solutions involve an extension of state intervention and power, which represents the policies of the past. Private enterprise competing with a free market will create the jobs of the future.

Photo of John Hutton John Hutton , Barrow and Furness 7:59 pm, 8th December 1992

I have been fortunate to listen to most of the speeches in the debate. Unlike the hon. Member for Colne Valley (Mr. Riddick), I have not heard any of my right hon. and hon. Friends knock British industry. I assure the hon. Gentleman that I will not knock British industry because I am a strong and passionate supporter of industry, especially the engineering industry.

I should like to talk about the current level of unemployment in my constituency and its effect on the fabric of life in my community. I should also like to talk more widely about the current difficulties in British manufacturing industry.

Before doing so, I express to my hon. Friend the Member for Wallasey (Ms. Eagle) the immense feeling and regret in my constituency about the closure of Cammell Laird at Merseyside. Cammell Laird is a great shipyard. It has a great and strong history. The people in my constituency feel real regret that it has been announced that the yard will close. I place the responsibility for that closure not on the management of Vickers Shipbuilding and Engineering Limited but on the policies being pursued by the Government. Since 1979 the Government have consistently failed to support the British shipbuilding industry.

Today there was a lobby of Parliament from people in my constituency. It is unusual for my constituents to lobby Parliament, because my constituency must be one of the most difficult to get to and from. However, many of my constituents made the effort to come to Parliament to meet hon. Members and Ministers and to remind them of what has been happening in one of the great centres of the British engineering industry.

Since 1990 and the publication of "Options for Change", 8,500 redundancies have been declared in my constituency. More redundancies have been declared in Barrow and Furness than in any other British constituency. Those redundancies are a devastating blow to my constituency. About 4,500 people are registered as unemployed, although the true extent of unemployment in the constituency is substantially higher. I have just learnt that 5,500 of my constituents claim sickness benefit, the vast number of whom will be unemployed. If the number of my constituents claiming sickness benefit is added to the number claiming unemployment benefit, the real level of unemployment in my constituency is probably nearer 20 per cent. than the official figure of 10 per cent.

My particular worry is the effect that the redundancies and job losses have had on young people. Since 1990, 1,000 engineering apprentices have disappeared from my constituency. Every year the VSEL shipyard recruited about 300 young people aged 16 years. Most of them were boys, but many were young women. That recruitment of apprentice trainees has finished. Vickers accounted for a high proportion of the total number of engineering apprentices in the United Kingdom. The loss of the recruitment programme is a serious blow not only to my constituency but to the engineering industry of the United Kingdom and our future as a trading nation. That level of apprentice lay-offs is a devastating blow to my community and the country as a whole.

Unfortunately, we know that there will be heavy job losses in Barrow in the next two years. The programme of shedding workers and redundancies at Vickers is far from over. The worst expectation is that as many as 4,000 extra redundancies could be made in my constituency in the next two to three years. The combined effect of those redundancies will be that every family in my constituency will have been directly affected by unemployment. Whole families have lost their jobs at the shipyard. Many parents are worried about the employment prospects for their children. Therefore, in my constituency and in the constituencies of my hon. Friends—and, I suspect, the constituencies of Conservative Members—an entire culture of service to the nation and an entire tradition of skill and work are at risk.

The hon. Member for Colne Valley spoke about the feelings of many Conservative Members about those who are out of work. I was glad to hear him say that, because the impression I gained from listening to the debate is that there is not a great deal of concern among Conservative Members. I welcome the hon. Gentleman's reassurance.

When we talk about unemployment we are not whingeing. We are not knocking British industry or running the country down, as many Conservative Members would like the House to believe. We are simply reminding the Government and Conservative Members of the consequences of their economic policies. For many communities in Britain, those economic policies have been devastating in the past few years.

The root of the present difficulties in my constituency lies with the Government's failure to support manufacturing industry, especially the engineering industry. The shipbuilding industry has been badly hit by the recession. Indeed, that industry has been in a process of structural decline, certainly since the late 1970s. In response to some of the comments that I have heard tonight, I should point out that Britain's shipbuilding industry and, indeed, the shipbuilding industry of Europe is not a smokestack or old-fashioned industry. It is a high-tech and highly skilled industry.

The contribution of my constituents to shipbuilding and the quality of engineering in my constituency are second to none in the world. In particular, the engineering work on the Trident programme is without parallel; it is some of the highest-quality work that any British shipyard has ever produced.

A Conservative Member referred to engineering as a low-tech, metal-bashing industry. That is nonsense. The shipbuilding industry of Britain, especially the shipbuilding facilities in the Devonshire Dock Hall in Barrow, is the finest in Europe—I would argue that it is the finest in the world. Because of the Government's inaction and their pursuit of ideology, there is a serious risk that we shall once again surrender huge tracts of our engineering industry to foreign competition. When the worldwide demand for merchant shipbuilding is set to double in the next 10 years, why are we still pursuing a range of policies that will mean that British shipyards will not be able to compete for that work?

It is inconceivable that any other European Government will allow such an important industry to be sacrificed on what I can only describe as a rather outdated and pathetic high altar of free market forces. We are pursuing policies to spite ourselves—to cut off our noses—and there is no economic, political or social logic in such policies.

Other shipbuilding industries in Europe are taking advantage of an increase in orders for merchant shipbuilding. I ask the Government to recognise the contribution that our marine engineering industry can play in revitalising our manufacturing base. As a maritime nation with an immensely proud history and tradition, it is extraordinary that the United Kingdom does not have a policy for its marine engineering industry. How have we ended up in such an extraordinary and ludicrous position?

I am not here simply to highlight the problems in my constituency, although I believe that those problems are very serious. I want to offer the Government some positive advice and guidance about what they should do to tackle the growing unemployment in my constituency and other shipbuilding communities in Britain. The Government need to reconsider their position on the seventh EC directive on aid to the European shipbuilding industry. In particular, they need to reconsider their view that the naval shipyards of Britain should not qualify, and will never qualify, for intervention funding.

Looking back at the past 10 to 12 years, it might have been logical in the 1980s for the Government to take that view, because the order books of our naval yards were buoyant and the cold war was still in full force. Many of the naval shipyards of Britain were able to look forward to decades or more of secure employment. That was certainly true of the VSEL shipyard in Barrow.

We looked forward to building a large number of hunter-killer submarines and a full complement of 2400-class Upholder boats. All that finished when the Secretary of State for Defence announced substantial cuts in the submarine procurement programme. At a stroke, my constituency lost £3 billion worth of envisaged submarine procurement. The same is true to a smaller extent of other yards in Britain. The naval construction programme was substantially pruned.

It is not possible for constituencies such as mine, which have been historically dependent on work from the Ministry of Defence, suddenly to change on their own. The naval yards that had looked forward to secure order books found themselves with none. They found themselves in much the same position as many of the merchant yards in the 1970s and early 1980s.

British warship yards have experienced a substantial and material change of circumstances. That declining volume of work and expected work from the Ministry of Defence should compel the Government to reconsider their view of the seventh directive and argue the case at European level for intervention funding to help our warship yards.

Our warship yards are just about all that we have left of a once mighty industry. For example, the industry once produced more than half of all the ships built on the planet. We are now reduced to a tiny fragment of that. Given the range of skills and the level of investment in some of our yards, it would be criminal for the Government not to continue to support the British shipbuilding industry by seeking amendments to the seventh directive. They should seek to develop an eighth directive that will enable the warship yards to qualify for merchant shipbuilding work. It is essential that the Government do that.

It is imperative that my constituency attracts assisted area status and development area status. I have noticed—I am sure that other hon. Members have also noticed—that the budget for the Department of Trade and Industry for the next three years is set to fall. In my constituency we have invested a great deal of hope in attracting assisted area status. But where is the beef? Where will the cash come from to give my constituents and those of other hon. Members the hope and confidence that they want for the future? The Department of Trade and Industry should be one of the great Departments of state. It should lead and fuel the engine of British engineering industry. Yet it is set to cut the support that it provides. That is an alarming development.

We have heard a great deal during the debate about training. It is important to bear it in mind that most of the training and enterprise councils are gearing themselves up for further cuts next year. Unlike the hon. Member for Colne Valley, I see little empirical evidence of recovery in the British economy. He may give anecdotal evidence that unemployment is levelling off in his constituency. I am delighted to hear that, for the sake of his constituents, but there is no sign that unemployment is levelling off in my constituency. We expect unemployment to double in the next two years. That is a horrifying prospect for my constituents.

The Government say that a commitment to high-quality training underlies their supposed concern about unemployment. We do not see that in my constituency. Cumbria TEC faces substantial cuts in its training budget for next year, at a time when we know that unemployment is set to rise substantially in my constituency.

Plenty of issues give rise to anxiety and it is appropriate for hon. Members to express that anxiety, as I have done, without being accused of whingeing or of knocking British industry. I am not knocking British industry. Industry has played an historic role in my constituency not only in defending the country—we are proud of that—but by being a resource which is of use to the nation. We have the skills, the engineering excellence and the base.

Opposition Members do not knock British industry. We support it. We wish sometimes that the Government would do the same. Like many other shipbuilding communities, my constituents have given real service to Britain in both war and peace. They are not being properly rewarded. Indeed, they are not being rewarded at all.

The Government should display the imagination and provide the support that other nations give to their shipbuilding industries. That would have a substantial beneficial effect on unemployment in all the shipbuilding communities of Britain.

Taking a wider view, Opposition Members see with alarm what is happening to the British economy. Many statistics have been traded about the state of the British economy. However, it is appropriate to examine some of the statistics that have not been mentioned so far tonight. Unemployment stands at almost 3 million. It has risen for 29 consecutive months—a cumulative rise of more than 1·2 million. Vacancies have fallen to 95,000—the lowest level since 1981. We have the third highest level of unemployment in the European Community.

Manufacturing industry is dear to my heart and essential to the well-being and prosperity of my constituents. Manufacturing investment was 5 per cent. lower in the first six months of 1992 than in the same period in 1991. It fell by 16·5 per cent. between 1989 and 1991 and is now lower than in 1979. Investment in the whole economy fell by 2·5 per cent. between the first and second quarters of 1992, having fallen by 10 per cent. in 1991. Those are pretty grim statistics.

Let us examine our gross domestic product compared with that of other countries in the European Community. From 1990 to the present day, the United Kingdom GDP has fallen by 2·5 per cent., while that of Germany has grown by 5·3 per cent., that of France has grown by 6·1 per cent. and the EC average is a growth of 4·5 per cent. In the same period, United Kingdom manufacturing output, which is of direct interest to my constituents, has fallen by 5·25 per cent. while that of Germany has risen by almost 8 per cent., that of France has risen by 5·5 per cent. and that of Spain has risen by 7 per cent. Those are the real indicators of the Government's achievements in managing the British economy. It is a pathetic and embarrassing record.

Ministers continue to believe that government is part of the problem. That is not true; government can be part of the solution. It is depressing to hear Conservative Members continue to run down and neglect the role of the Government in fuelling activity in the economy. We need the right balance between macroeconomic policies and supply-side measures to produce low-inflationary growth in the economy. There is no sign that Ministers or Conservative Members are thinking along those lines. In that case, unemployment will continue to rise.

There will be no hope for those who are unemployed until the Government change course and recognise that unemployment is an injustice which must be put right. That is why I shall support the motion in the name of my right hon. and learned Friend the Leader of the Opposition.

Photo of Oliver Heald Oliver Heald , Hertfordshire North 8:16 pm, 8th December 1992

In my constituency we share many of the problems of unemployment described by the hon. Member for Barrow and Furness (Mr. Hutton). It may seem odd to say that north Hertfordshire and Barrow and Furness have anything in common, but we have always relied on the defence industry for employment. We have been hit hard by the cuts in defence spending in the past two years. Unemployment has increased by 143 per cent. in that period.

I accept that unemployment has caused distress to the families of my constituents. It causes great anxiety and often it is a tragedy for them. I have met Many of them. Conservative Members understand the anxiety and distress that people feel in those circumstances. However, the point that Conservative Members make is not that the Opposition criticise the Government in a shallow way; our point is that Opposition Members fail to consider the full background to the problem. It is wrong to view a policy for full employment as a realistic aim, in the short term at any rate, when across Europe 12 million people are registered unemployed. It is said that we need 2·5 per cent. growth merely to stand still.

The background of high unemployment in Europe has not been addressed in the speeches that we have heard today. When my learned Friend—I mean my hon. Friend; old habits die hard—the Member for Milton Keynes, South-West (Mr. Legg) gave the statistics on youth unemployment it was noticeable that there was no answer to the point that Spain has 33·7 per cent., France has 22·1 per cent., Ireland has 28 per cent. and Italy has 29 per cent. youth unemployment. Those countries have minimum wage policies but seem unable to develop successful policies to deal with youth unemployment. In this country, youth unemployment is well below the average in the rest of the European Community. It would be wrong to consider that issue without taking into account the background of unemployment and the task that Europe faces in trying to deal with it.

When the hon. Member for Holborn and St. Pancras (Mr. Dobson) attacked British companies, saying that they were not fit to be in the Group of Seven and were not among the best, I felt that it was a complete misdescription of British industry. We have 27 of the top 50 companies and six out of the top 10 big companies in Europe. There are successes, which Opposition Members are simply ignoring.

In north Hertfordshire the rate of increase in unemployment has levelled off and has fallen in recent months because of local companies' response to the problems. Our largest employer, Johnson Matthey plc, based in Royston—a precious metals business and manufacturer of auto catalysts—has announced improved results for the first six months of 1992 because it has excellent products, high levels of efficiency and has invested heavily in the products that it manufactures. It has done a good deal of research and development with considerable assistance from Government funds. As a result, that great company has been able to regenerate at one end of my constituency.

At the other end of my constituency, a large number of people work at the Vauxhall motors plant at Luton. Sales of cars have improved in recent months, which has been good for employment in the constituency. Many smaller companies have entered the BS5750 quality management improvement scheme and seem to have had successes resulting from that. Many small companies have made use of available Department of Trade and Industry schemes, road shows and local advisers to improve their export performance. They found that the British Overseas Trade Board's new approach of trying to identify markets for British goods has been a success.

Our chambers of commerce are trying to spread best practice throughout the constituency. New business opportunities for companies have resulted from the inter-trade fairs that have been arranged. The Letchworth Business Club must be an example to the country—500 companies take part in its activities to improve quality, to export more and to try to improve the local position.

The training and enterprise council in Hertfordshire has had to face a large blow because of defence industry cuts. It has set up a task force for Hertfordshire and co-ordinated efforts to improve inward investment, training and the regeneration of local business, to some effect. It also pioneered training credits and customised training schemes. That is a model of what should be happening throughout the country.

From the evidence given to the Select Committee on Employment, it is noticeable that training and enterprise councils provide a good focus for regeneration in areas where jobs have been lost. Some union leaders, such as Bill Jordan, were noticeably enthusiastic about the ways in which TECs could be used, while others were not. It would be a good thing if hon. Members on both sides of the House agreed that TECs are the way in which we are going to deliver training and stimulate enterprise and if we all put our support behind them.

The submission on pit closures by the north Nottinghamshire TEC to the Secretary of State was interesting. Against a difficult background, it has been able to persuade 500 local companies to become members of its scheme, and it got about 40 new corporate members every month. Perhaps the Manufacturing Science Finance union was able to reach a no-strike agreement with the Japanese company Toray Textiles Europe in that area because it has a good training and enterprise council and because the local unions are getting the message. The attitude of Roger Lyons, the new general secretary of the MSF, is in stark contrast to that of his predecessor, Ken Gill. Mr. Lyons comments on the new agreement are worth quoting— Day 1 of MSF was September 1 1992. I'm not going to be held responsible for statements or comments made personally by my predecessor. The deal marks a watershed for the MSF by taking a predominantly white-collar union into blue-collar representation. The Amalgamated Engineering and Electrical Union was so delighted at the change of attitude that Paul Gallagher said: I'm surprised but delighted that MSF have stopped seeing inward investment as alien.

Photo of Paddy Tipping Paddy Tipping , Sherwood

Does the hon. Gentleman accept that north Nottinghamshire workers are pragmatic and hard working? The record of Nottinghamshire miners, and of miners throughout the country, speaks for itself—during the past five years there has been a 150 per cent. increase in productivity. The hon. Gentleman mentioned the north Nottingham TEC and some of the things that it does. Surely one needs to invest in infrastructure to bring new jobs, investment and prosperity to north Nottinghamshire. To invest—

Photo of Oliver Heald Oliver Heald , Hertfordshire North

I understand the concern of the hon. Member for Sherwood (Mr. Tipping). Obviously it is important that an area such as north Nottinghamshire should be able to regenerate the jobs that have been lost and those which may be lost with pit closures—we do not know at this stage. To do so, a range of measures will need to be taken in the locality. As the hon. Gentleman will know, Lord Walker has the job of considering a range of measures that may be necessary to regenerate the local economy in areas where pits are closed.

In an area like Mansfield, which I understand is some distance from main road and rail links, it may be necessary to consider what major investments will be needed. Alternatively, workers in Mansfield might be able to move nearer to road and rail links to obtain work. The important thing is that TECs can play a pivotal role in regenerating areas where there are substantial job losses and that has been proved in Hertfordshire. I hope that the hon. Gentleman and other Opposition Members will put their full weight behind the TECs and that they and the trade unions will not make the sort of ill-conceived criticisms that they have made in the past.

Photo of Oliver Heald Oliver Heald , Hertfordshire North

I had not finished my speech, Mr. Deputy Speaker. I was giving way to the hon. Member for Darlington (Mr. Milburn), who wished to intervene.

Photo of Alan Milburn Alan Milburn , Darlington

I wish to defend the honour of Roger Lyons, who as my general secretary will be delighted by the hon. Member's support. Would he care to comment on the fact that there was a cross-party argument not so much on the role of TECs but on the resources being made available to them? Is it not a fact that this year a near majority of TECs have had their funding cut compared with last year and that they have had to cut about 500,000 employment training weeks from their budgets as a result of the Department of Employment cuts in funding?

Photo of Oliver Heald Oliver Heald , Hertfordshire North

The Department of Employment has had a real-terms increase in its budget for next year, and I understand that a further £118 million will be available.

As I was saying, the trends in north Hertfordshire and in areas where the TECs are giving a lead are especially important. In addition, the initiatives of the Department of Trade and Industry in support of our exporters are about to be expanded, and that is to be welcomed.

In addition to all of that, we are, under Conservative rule, cutting down on bureaucracy. About 24,000 Government forms have already been scrapped and steps are being taken to try to improve the VAT regulations. The measure introduced recently to allow small companies to pay VAT on receipts rather than invoices is working well and, for example, Hitchin chamber of commerce has described it as a successful step. We want other measures to reduce the dominance of large trading companies over their smaller counterparts, and the recent Green Paper on that subject is to be welcomed.

It is interesting, when examining the role of trade unions with single union agreements and inward investment—some unions have supported the concept, while others have not—to note that, in its evidence to the Select Committee on Employment, the TUC praised the efforts of trade unions and the valleys programme in helping to attract inward investment. That conflicts with what some Labour Members have said about the programme being a failure. Indeed, the TUC said: It is through government, employers and trade unions working in partnership in this way within our communities that real progress will be achieved. Britain has the lowest interest rates in Europe, a competitive exchange rate, low taxes and an excellent work force with good industrial relations. That is a winning ticket with which Britain can go forward and succeed. If we add the measures taken in the autumn statement to revive the housing market, improve business investment, reduce car tax and help export credits, we are better placed than the rest of Europe to face up to the problem of unemployment. That is why I shall support the Government amendment.

Photo of Angela Eagle Angela Eagle , Wallasey 8:32 pm, 8th December 1992

I might describe my attempt to intervene in the speech of the hon. Member for Hertfordshire, North (Mr. Heald) as the shortest contribution I have ever made in the Chamber.

I wish to speak generally about the Conservatives' record on unemployment, going back initially to 1979 and then examining their policies that have led to high rates of unemployment. I reinforce some of the comments of my hon. Friend the Member for Birkenhead (Mr. Field) and thank my hon. Friend the Member for Barrow and Furness (Mr. Hutton) for his remarks about Cammell Laird.

One of the main features of post-1979 Conservative Governments has been the high, increasing and persistent rates of unemployment resulting directly from their policies. Much has been said today about recession in the rest of Europe and throughout the world. Conservative Members have failed to point out that we in Britain are into our second recession. We went into recession earlier and have remained there longer. Indeed, we are now in an even more persistent recession, the worst Britain has experienced for 60 years. So while there may now be world recession problems, that was not the case when the Conservatives, with their odd policies and peculiar ideological obsessions, plunged us into recession in 1980–81.

Photo of Oliver Heald Oliver Heald , Hertfordshire North

Britain is now poised to come out of recession—[HON. MEMBERS: "When?"]—while countries such as Germany are predicted to have unemployment levels rising to about 6 million within two years.

Photo of Angela Eagle Angela Eagle , Wallasey

Time will tell whether we are about to come out of recession and whether the hon. Gentleman's predictions will materialise. After all, we have been on the starting blocks, the green shoots showing, for at least 18 months, yet we are still bumping along the bottom.

It is important in a debate about unemployment to consider the Conservative record going back over the years rather than to dwell only on the present state of affairs, especially as that record includes persistent and high rates of unemployment, reaching levels that nobody thought possible prior to 1979. It was not thought at that time that such unemployment levels could be politically sustainable in a democracy. The Government have presented the situation today as a sort of natural phenomenon that descended on Britain in the last 14 years. They claim that there was little, if anything, they could have done about it.

There are two clear effects of the dogma adopted by the Conservatives in the years immediately following 1979. Still showing through their policies is the ideological belief that it is no role of Government to do anything to deal with demand in the economy. They seem to think that they need only remove government from as many areas of life as possible and all will come right because market forces will provide.

The second clear effect is the appalling incompetence demonstrated by the first Tory Government in 1979, when they launched themselves on their frenzied monetarist phase, which destroyed one third of the then British manufacturing base. We have not yet recovered from that.

We must return to those early years of Conservative government to recall how bad the situation was. Their monetarist dogma has been discredited by its very practice. It has been shown to be absolute nonsense. Not only has it not worked, but it has been damaging to the nation. The House need not take my word for that. Monetarism proved to be a disaster for employment, and we are living with the consequences of it today. I quote from a recently published book—I shall identify the author shortly—on the subject: Thatcherism largely consisted of 19th century individualism dressed up in 20th century clothes. Economic dogma was at its core. The author went on to say that Thatcherites adopted a particularly dogmatic form of classical economics and that no other Government had become such fundamentalist devotees of the Friedmanite scriptures. The Conservative party, of all the leading right-wing European democratic parties, had then become far and away the most dogmatic. It is clear from today's debate that that dogma still exists. The author continues: The attempt to control the money supply helped to produce an exceptionally large, rapid and enduring rise in unemployment. That was not written by a Marxist or trendy lefty polytechnic lecturer. The author was Lord Gilmour in his book "Dancing with Dogma."

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

If monetarism and what the hon. Lady described as Thatcherism was such a disaster in the 1980s, perhaps she will explain why we got an extra 1 million self-employed people and more than an extra 1 million jobs in the economy during that period.

Photo of Angela Eagle Angela Eagle , Wallasey

I had intended to deal with that issue later and to examine the quality as well as the quantity of jobs created. The structure of employment in Britain has changed in the past 14 years, away from secure and skilled jobs to more insecure, low-paid and part-time jobs.

Apart from the obsession with monetarism in the early 1980s, Conservative ideology believed that the superiority of market forces would provide, so that the Government could sit back and wait for the market to provide perfect solutions to every problem.

We are now in our second recession. We have lost massive chunks of manufacturing industry, and only 4 million of the 50 million people who live in this country now work in manufacturing. Great swathes of skilled people have been put on the dole and many healthy industries have gone to the wall simply because, as Lord Gilmour said, the Government's reaction to what is happening in the economy has been much more dogmatic than that of the Christian Democrat Governments in Europe, all of whom admit that there is a role for intervention.

Intervention has a role not only in events in a sector of the economy but also in affecting demand. The level of demand in the economy seems to be taken as something that is handed down from Heaven and on which the Government can have no effect. The Secretary of State said that the Government can simply provide supply-side polices to retrain and provide skills so that people can better be matched to jobs. She did not say how the Government could increase demand in the economy to create more jobs.

I therefore looked at whether the autumn statement contained anything about creating demand. I must admit that it contained a small dash of intervention in the form of construction projects, which the Chancellor of the Exchequer hopes will create employment. But many of them do not start until 1996. I wonder whether that is a clue to the date of the next general election or simply my musing about what might be on the Prime Minister's mind.

The autumn statement was presented to the House in the aftermath of the most humiliating and expensive economic debacle that we have seen for a long time, when we were forced out of membership of the ERM. We then had the spectacle of a Government in search of an economic policy. The autumn statement is meant to be it. It contains just a little touch of expansion but also a public sector pay freeze. It is not clear to me—it has not been mentioned by Conservative Members—whether the autumn statement's overall effect will be deflationary because of the spending power that it will take out of the economy, and whether that will make unemployment worse. Time will tell.

The Government have been pursuing their own ideological dogmas and have been content to let unacceptably high unemployment persist. I want to discuss how that affects my local area. It is apposite that I discuss that matter after last week's announcement of the final closure date for the Cammell Laird shipyard, which is to be next July if the Government and Vickers Shipbuilding and Engineering Ltd. are allowed to proceed. As my hon. Friend the Member for Barrow and Furness pointed out, he is in a similar position. Birkenhead and Wallasey have been built up around one industry. When that industry is threatened with closure, the results are catastrophic for the surrounding area.

I applaud and join my hon. Friend the Member for Birkenhead in his determination to ensure that the yard does not close. We shall do our level best, with the help of the community, agencies and, I hope, the Government to ensure that it has a future as a shipbuilding yard, out of VSEL's control, to maintain skills and jobs in that important area.

Wallasey and the Wirral were much weakened by the monetarist experiments of the 1980s. Indeed, 15 per cent. of the manufacturing industry in that area disappeared during that period. We now have another turn of the screw, which will ratchet down unemployment even further in an area already weakened by the Government's economic mismanagement. If the yard goes, almost 1,000 direct jobs will go immediately. Up to 6,000 other service jobs will go as an indirect result of the closure. Some 600 local firms that have supplied the yard will be at risk. During its history, Cammell Laird has been notable for always going to local firms for supplies. Consequently, the effect of its closure on the local community will be all the more devastating because of its acceptable and responsible purchasing pattern.

The local borough council estimates that £30 million of spending power will be taken out of the local economy. One in seven people is out of work in the area. The official unemployment figure for Wallasey, where many of the people who work in Cammell Laird live, is almost 14 per cent. In addition, because of the cost of unemployment, retraining and other issues that have been mentioned, it is estimated that the closure will cost the public purse £111 million in the first year. It is economic madness to close the yard and put out of work one of the most skilled work forces in the country, given that the industry is likely to be revived in the world market within a couple of years. We have some of the best shipbuilding facilities in the world. Because it is so mad, the Government will probably decide to let it happen.

The Wirral area has 19,000 people on the dole before the potential economic holocaust that the closure would unleash. Wallasey has above average unemployment, with 18 per cent. male unemployment, 7 per cent. female unemployment and an overall level of 14 per cent. There would be a 2 per cent. increase immediately if the shipyard went. Moreover, 37 per cent. of that unemployment is long term—people who have been on the dole for more than a year. I meet constituents who have been out of work for most of the decade and have little prospect of a job.

Another disturbing aspect of unemployment in the area is the large number of youths unemployed. People in their mid to late 20s have never worked since they left school. It is easy to imagine why we have one of the worst drug problems outside Edinburgh and London. It must be connected with the despair and hopelessness that accompany years of unemployment with no prospect of getting out of it. That should concern hon. Members on both sides of the House. We must reintegrate people who feel that they have been forgotten and neglected, that the Government do not care about them and that the political system excludes them. Unless we do, we are simply racking up problems for the future and must deal with the economic and political whirlwind that will come about if we ignore it now.

When the Government first came to power, the then Prime Minister, on the steps of 10 Downing street, used a quote by St. Francis of Assisi. I remind hon. Members of what she said: Where there is discord may we bring harmony. Where there is error may we bring truth. Where there is doubt may we bring faith. Where there is despair may we bring hope. That is none out of four. Unless the Government do something to deal with those serious and persistent issues and social problems caused by the high unemployment that they are creating, that quote will remain the sick joke that it represents to most people who are on the dole or live in fear of it and the problems that it brings.

Several Hon. Members:

rose——

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

I understand that the wind-up speeches are to begin at 9.20 pm. There are four hon. Members hoping to catch my eye, and I hope that each speaker will bear that in mind.

Photo of Mr Michael Bates Mr Michael Bates , Langbaurgh 8:50 pm, 8th December 1992

I am grateful for the opportunity to speak in this important debate. I can assure Opposition Members that no Conservative Member underestimates the human tragedy of unemployment. I hope that we can have a constructive debate—we all recognise the tragedy that we are discussing and want to find the best way to reduce unemployment. I have no doubt that the 5,324 constituents of Langbaurgh who are unemployed are my top priority. We are debating the best ways of getting those people back to work.

I am interested by the motion, which states that it condemns the Government's Autumn Statement for its total failure to tackle the jobs crisis". That does not square with what the Confederation of British Industry, chambers of commerce—including that in my district—the Federation of Small Businesses, and all the small business men to whom I have spoken have said. They think that the autumn statement will be good for business and for jobs.

What, exactly, is the Labour party condemning? Is it the fact that we are maintaining low inflation—at 3·6 per cent? Is that what you are condemning? Are you condemning our commitment to capital spending, which was heavily cut under the last Labour Government? Is it the provision of the Jubilee line extension at a cost of £1·9 billion? Do you condemn that? Is it the maintenance of the house building——

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. I do not condemn anything.

Photo of Mr Michael Bates Mr Michael Bates , Langbaurgh

I beg your pardon, Mr. Deputy Speaker.

Does the Labour party condemn the housing spend—the 35 per cent. increase in the Housing Corporation capital resources amounting to £2·3 billion? Does the Labour party condemn the £900 million that will be released by the change in capital rules for local government? Does it condemn the £2·1 billion worth of capital projects or the £95 million to benefit the inner cities? Does it condemn the cut in interest rates to 7 per cent.—the lowest level for 15 years? A I per cent. cut in interest rates saves British business and industry £1 billion. Does it condemn the £7 billion or £8 billion of investment in business?

Does the Labour party condemn the maintenance of our commitment to uprate benefits for the casualties of the international recession? Does it condemn the increase of unemployment benefit in line with inflation? Does it condemn the increase in child benefit and state pensions in line with inflation? Is that what the motion condemns?

Does the Labour party condemn the Government policies for their popularity? Popularity has never come easy to the Labour party. We can mention many fine achievements, but the Labour party considers other aspects and condemns them in its motion. Such factors include the abolition of car tax which, it is estimated, will provide demand for an extra 70,000 units next year. The Labour party condemns the increase in capital allowances—40 per cent. for the first year—a policy which has gone down well with small business men. It condemns the £750 million in extra export guarantees introduced in the autumn statement.

The autumn statement was popular, but was short of one item. When I travel around my constituency and the north-east of England, business men tell me that they are short of confidence. People need confidence to go out shopping and to invest. I believe that confidence is the only ingredient missing from the British economy.

The Labour party's contribution to today's debate will do nothing to enhance confidence—if anything, it will continue to run down the country. That is nothing new. I have lived in the north-east all my life, and I have lived cheek by jowl with the Labour party and the effects that it has had on the north-east, such as unemployment. I know how the Labour party has managed to run down the north-east.

The Labour party says that the north-east needs Government investment, but it does not mention the £3·5 billion Government spending and investment since 1979. Does the Labour party mention the £216 million already received, or about to be received, from European funding between 1991 and 1993? Does it mention the Northern Development Company or explain how that company has played its part in attracting £2 billion since 1985, creating or safeguarding 35,000 jobs?

The call from the Opposition is that we should do more. I believe that we have. Let us consider the jobs that the Government have relocated to the north-east of England. Some 1,700 jobs in the Department of Social Security were created at the Longbenton complex in Newcastle, which already employed 7,000. What about the 400 jobs created by the Government's location of the Inland Revenue in the north-east? What about the 250 tax jobs in Sunderland? What about the 350 jobs at the Ministry of Agriculture, Fisheries and Food, which has been moved to the Newcastle business park? What about the licensing branch of the Department of Trade and Industry, which has been located at Billingham in Cleveland, with the creation of 61 jobs? Some 50 jobs were created at the Department for Education when it moved to Darlington in County Durham, bringing the total number of jobs at that site to 800.

However, we need more jobs. The work of the urban development corporations has been important. The Government sponsored them with £80 million in the current year. They have attracted £500 million worth of private business to the north-east. Is that enough? Apparently, it is not. What about the training and enterprise councils? Teesside TEC, funded by the Government, helped to set up 500 new businesses during the past two years, which is welcome. That shows what the Government are doing to help create jobs and alleviate unemployment in the north-east of England. What about the inward investment that has been attracted to the north-east of England? Clearly, across the water in America and Japan, people have a higher regard for us than have some Labour Members.

What about inward investment? Nissan UK has invested in a plant in Sunderland, with 3,000 jobs and a further 1,800 jobs planned. The Fujitsu plant represents £600 million worth of investment, creating about 1,500 jobs. Hashimoto Formings, the Japanese car component manufacturer, is investing £10 million in the north-east.

Photo of Mrs Elaine Kellett Mrs Elaine Kellett , Lancaster

Does my hon. Friend recall that the former Leader of the Opposition described Japanese investment as "alien jobs"?

Photo of Mr Michael Bates Mr Michael Bates , Langbaurgh

I am grateful for that intervention. I am sure that such comments go down a storm in Sunderland, Washington, Newcastle and Middlesbrough, where so many people depend for their livelihoods on jobs that come from Japan—and we are grateful to receive them. The Japanese certainly appear to have investment confidence in the people of the north-east; it is time Opposition Members showed some of the same confidence.

We will not sit back and see our region run down by the Opposition. I want to tell the House about Sommer Industry, the French car component manufacturer, which is setting up business in Washington and creating 100 new jobs. Sterling Research Group, of the United States of America, is expanding its pharmaceutical research centre at Alnwick, with 160 jobs. TRW Thompson, a German-based car valve manufacturer, is to create 225 jobs at a new plant in Washington. Lite-On, of Taiwan, is coming to Ashington with 150 jobs. Synpac Chemicals of Taiwan is to take over part of the Glaxo site, creating 200 jobs.

It is not just overseas manufacturers who have confidence in the north-east, however. We take pride in the work that we do there for these companies, and for companies from this country as well. British Airways has moved to Newcastle business park, with 700 new jobs to be in place by 1994. MTM, the Cleveland-based chemicals group, has invested £100 million in Teesport, creating 600 new jobs. Bioprocessing Limited, of Consett, has invested £2·5 million in a new factory, thereby creating 100 jobs. Glaxo has opened a new £9 million production unit at Barnard Castle; it provides 1,500 people with employment.

Another engineering firm has set up a new offshore manufacturing unit which will provide 600 people in the north-east with employment. The MetroCentre, with its multi-million pound investment and 3 million sq ft of shopping space, includes jobs for 6,000 permanent employees. Then there is the development of the multi-million pound Doxford international business park at Sunderland—a development which will go ahead over the next five years at a cost of £250 million, generating up to 3,000 jobs. The development of the new Newcastle business park will create another 5,000 jobs. Investment in the park has topped £150 million.

This is the news from the north-east, the face of the north-east that we want to show, not to the businesses of this country—they know why they come to the north-east by the coach-load—or to the companies of Japan, America, Germany or France—they have confidence in us—but to the Opposition. They could do with some confidence in the north-east. Instead of running us down, they should be selling the benefits of locating there.

I want to end by coming a little closer to home, to Teesside——

Photo of Paddy Tipping Paddy Tipping , Sherwood

Is not unemployment in the north-east the highest in this country? What message is going out to the long-term unemployed there? What about the fact that there is no capital investment in the north-east? What about the message of no hope? And what do the hon. Gentleman and his colleagues intend to do about it? Absolutely nothing.

Photo of Mr Michael Bates Mr Michael Bates , Langbaurgh

That just proves that Opposition Members cannot see a silver lining without spotting a big dark cloud wrapped around it. The hon. Gentleman comes straight out of the Opposition school of management which believes in attracting business by running down the product. The Opposition might aspire to that view, but our international competitors do not buy it. So, while business is coming to the north-east, creating jobs and giving people some hope of a livelihood, it might perhaps be just as well if Opposition Members kept their thoughts to themselves for the moment.

To return to Teesside, there was a publication by the Evening Gazette there, with the headline The region with a £4 billion smile". That was just last month. It was an excellent publication which I commend. There is a £32 million development at Preston Farm; and a £50 million development at Teesdale business park with an £80 million development at Teesside Park and the new Enron power station. There is a £50 million development by MTM and further developments of £16 million at Belasis technology park and of £1·2 billion by Amoco.

That is the evidence of what British business and international business think about the north-east and about this country. We have the fundamentals in place. The autumn statement was a success and we need to say that, because we have concern and compassion, the best thing we can do is to send out the message that we have confidence in British business and in the north-east and will back it to the hilt.

Photo of Jim Cunningham Jim Cunningham , Coventry South East 9:06 pm, 8th December 1992

The Opposition are condemning not the ingenuity of British people but the Government's handling of the employment situation. Let us be clear about that. In particular, when Conservative Members ask what we condemn let me tell them what I condemn. Jaguar motor cars in Coventry have systematically, over the past two years, started announcing redundancies, with 200 only last week. I condemn the fact that companies like Rolls-Royce and GPT have introduced systematic redundancies and Cadbury is struggling to maintain its labour force at present levels. Lucas is also struggling to maintain its labour force. I also condemn the answer to me last week from the Minister for Industry, when I asked about the output comparisons over the years. He told me that between 1981 and 1992 output has risen by only 0·05 per cent. What an indictment of the years of Thatcherism and of the present years of John Major's stewardship.

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. The hon. Gentleman referred to John Major. He must not do that. He must say "the Prime Minister".

Photo of Jim Cunningham Jim Cunningham , Coventry South East

I apologise, Mr. Deputy Speaker. I should have said the Prime Minister. I hold the Prime Minister and his predecessor responsible for the situation.

If Conservative MPs were to talk to business people and the Confederation of British Industry about the autumn statement they would get a different reply. They see the consequences as not giving much confidence to business people. Do hon. Members realise that small businesses are going to the wall at the rate of 10 per cent. a year? Since the autumn statement it has been disclosed that unemployment in the west midlands has gone up by 3 per cent. since September.

Those are the real facts, not the Walter Mitty world in which Conservative Members seem to live.

Photo of Mike O'Brien Mike O'Brien , North Warwickshire

Last Friday I attended a meeting of Coventry and Warwickshire CBI, which was attended also by some of the national leadership. They were asked, not by me but by a Conservative MP, what they thought of the autumn statement and if they regarded it as wonderful. Their response was that the autumn statement was irrelevant. Those were their words. It had created no confidence in the leadership that there was any hope of recovery.

Photo of Jim Cunningham Jim Cunningham , Coventry South East

That reinforces what I was saying; the business community very much has that opinion.

Equally I condemn the fact that there are just under 300,000 people unemployed in the west midlands and that is rising. In answer to the hon. Member for Langbaurgh (Mr. Bates), I condemn equally this Government's cuts of more than £7 million in local government spending in Coventry. Hon. Members should look at the effect of that on employment and on small businesses. Government policies in the west midlands are repeated throughout the country and will not help employment. Members of the Government Front Bench seem to find that amusing, but I do not think that unemployment is amusing.

Conservative Members said that training and enterprise councils should be supported, but many people can tell them that the problem with TECs is that they are underfunded. I know people who went to a jobcentre and were told to take a TEC course, only to discover that the courses advertised were not available. That is the kind of experience that the unemployed are suffering as a result of the Government's training policies, particularly in relation to the young.

Generations of young people have either never had a job or will, because of the abolition of wages councils, be working for slave wages. Those are the real issues that the hon. Member for Langbaurgh should address, rather than try to denigrate members of my Front Bench over what they might or might not have said. He should not try to imply that my right hon. and hon. Friends were in any way downgrading Britain. We are downgrading the Government, but we praise the British people for putting up with a Government who, having inflicted unemployment on this country, seem powerless to do anything about it.

The Government also stand condemned over the peace dividend. The Soviet Union no longer exists, and the Government had 14 years of negotiations in which to provide for the switch from defence industries to those having a peaceful purpose. They did nothing about that. The Government stand condemned in the eyes of not only this country but Europe.

Photo of Mr Peter Thurnham Mr Peter Thurnham , Bolton North East 9:12 pm, 8th December 1992

It was interesting to hear the speech of the hon. Member for Coventry, South-East (Mr. Cunningham), but his contribution did not quite reach the standard of his predecessor, which my hon. Friends and I always enjoyed. I am only sorry that the hon. Gentleman's predecessor did not do slightly better, because that might have let in the Conservative candidate at the general election. No doubt we shall hear more from the hon. Member for Coventry, South-East before we are finished.

I apologise for not being present for the start of the debate, but I shall read earlier speeches in Hansard with interest. Last week, I appeared on BBC television in the north-west with the Labour employment spokesman, the hon. Member for Holborn and St. Pancras (Mr. Dobson), and I am glad that he did not make then his accusation about employers being scum, to which my hon. Friend the Member for Colne Valley (Mr. Riddick) made reference.

I had intended to base my speech on Labour still being very much the tool of the trade unions, but I begin to wonder whether that would not be such a bad thing. I am glad that the new investment by Toray Textiles is supported by Manufacturing Science Finance, which said that "things are moving on". I wonder whether that is true of members of the Labour Front Bench.

As the unions are beginning to adopt new attitudes, perhaps it would be a good thing if Labour kept its links with trade unions rather than trying to abandon them, as it seems to be thinking of doing. However, it seems to have a slim chance of doing so when people such as Mr. Tom Sawyer state, "No say, no pay," and while unions contribute most of the money on which the Labour party depends.

I am glad that MSF supports inward investment, because it is so important to this country. Britain is now the most favoured location for inward investment in the world. No doubt that is because we have a strong enterprise culture after 13 years of Conservative government and the advantages of low taxes, our language, and our position in the European Community. All that makes us the No. 1 country for overseas investment outside the United States for the Americans, and for the Japanese and Germans after the United States.

That is shown by the success of Inward, the north-west development agency, which records as much success in the first half of this year as in the whole of last year. The Royal Institute of International Affairs states that the total stock of worldwide direct investment will more than double between 1988 and 1995. There is no recession there.

We are fortunate that this country is the preferred one for investment which is to grow on that scale.—[Interruption.] I do not see why the Opposition should laugh and reject the scale of investment by large international companies that is occurring.

Take Glaxo, one of the leading manufacturing companies in the world. The Opposition seem to think that manufacturing is not profitable, but Glaxo is extremely profitable. It exports medical drugs all over the world. The Japanese may make more motorbikes than we do, but we certainly make a lot more pharmaceuticals than they do; we export to them. Glaxo has just announced that it is creating a new £17 million state of the art manufacturing and packaging base at Speke. This is an example of what can be done with large companies investing in this country because it is so attractive for them.

Regional selective assistance has worked well for the north-west since 1983, when the map was redrawn. I hope that my hon. Friends will think carefully before altering the status at present enjoyed by my own constituency and other areas in the north-west. Unemployment in the north-west in 1983 was 3·1 per cent. more than for Great Britain as a whole. The latest published figures show that unemployment in the north-west is only 0·7 per cent. more than for the country as a whole. That shows that regional selective assistance has done much to reduce the unemployment rate in the north-west relative to the country as a whole. In my own constituency, 4,433 new jobs were created in small firms employing between one and 25 people between 1987 and 1989 as a result of our policies, which have encouraged small firms.

I draw the attention of the House to a publication that came out yesterday from the National Westminster bank, an economic survey by Mr. David Kern, who is very much respected. I recommend hon. Members to look at the figures which are quoted there for regional trends, which show how well the north-west and the north as a whole have done relative to the south. Making a prediction for 1993, Mr. Kern says that he expects the northern regions to again outperform those in the south, although regional growth differences will be less pronounced. That is more evidence that Government regional policies have borne fruit. The fall in gross domestic product in the south of the country has not occurred in the north.

The number of new firms registered for value added tax shows an increase of 1 per cent. in the north-west for the last full year, 1991, although there has been a decline in the south-east. Mr. Kern is predicting that there will be further increases in the number of firms registered in the north-west. [Interruption.] I do not know why hon. Members laugh; small firms provide jobs. I rather think that they are not very keen to hear their Front-Bench spokesman. If they wanted to hear her, they would not be intervening and thus presumably cutting down the amount of time she has to speak. However, I should be very happy to take an intervention if that is what they want.

Photo of Mike O'Brien Mike O'Brien , North Warwickshire

Does the hon. Gentleman not understand that this litany of all the wonderful things that are supposedly happening in this country belies the fact that we are in the middle of a recession and suggests that the Government do not understand that there are real problems with British industry, particularly manufacturing industry? They are destroying not only people's lives through losses of jobs, but the whole basis of Britain's economy.

While the Conservative party continues to voice a litany of minor things that are happening in the economy, it misses the greater picture, which shows that our economy is in desperately serious trouble. Unless this is addressed, Parliament will not start to make policies that will get the economy out of this recession.

Photo of Mr Peter Thurnham Mr Peter Thurnham , Bolton North East

The electorate chose the Conservative party to govern the country because the country really would be in a mess if Labour were allowed to introduce its anti-employment, anti-enterprise policies. There is no doubt that, in that event, we should find ourselves in the predicament that the hon. Gentleman describes. If the Conservatives espoused the policies of the hon. Member for Holborn and St. Pancras—if we were opposed to enterprise, and called employers scum—we would have reason to worry about the future; but the present Government have introduced policies to help companies to expand, and, in particular, have helped new companies to take on employees. An example is the success of Bolton Business Ventures. The difference between the figures relating to Bolton and those relating to Bury reflect the good work done by Bolton's enterprise agency. Perhaps more should be done to set up new firms in Bury.

Photo of Mr Terry Lewis Mr Terry Lewis , Worsley

Bolton Business Ventures, of which I was one of the first directors for two years before I became a Member of Parliament, was created by a Labour council.

Perhaps the hon. Gentleman would like to describe to the House the presentation given by the Central Lancashire Engineering Employers Association to Members of Parliament from the area only last week. He managed to stay for about 20 minutes; his Conservative colleagues did not get there at all.

Photo of Mr Peter Thurnham Mr Peter Thurnham , Bolton North East

I shall not digress to discuss what the Engineering Employers Federation said in a paper which was prepared before the autumn statement, and which is therefore completely out of date. I have been asked to keep an eye on the clock, so I shall confine myself to saying that there is evidence that regional selective assistance works. I hope that the Government will bear that in mind when looking at the map.

Photo of Ms Joyce Quin Ms Joyce Quin , Gateshead East 9:21 pm, 8th December 1992

This has been a wide-ranging debate. Opposition Members in particular have expressed considerable concern about the extent of unemployment, and the economic problems that we face.

Most Conservative Members have supported the Government's policies, although we have heard one or two coded criticisms. I was glad to hear the hon. Member for Beaconsfield (Mr. Smith) refer to the undervaluing of manufacturing in recent years: Opposition Members strongly agree with that. I was disappointed, however, when the Secretary of State again trotted out the weary argument that, by talking about the level of unemployment, Opposition Members were somehow talking the country down. It sometimes seems that the Government would like to use that as an excuse for engaging in no debate about the economic situation and unemployment. We cannot pretend that jobs are not being lost, but let me emphasise that Opposition Members are not talking the country down; rather, the Government have brought the country down through their disastrous economic policies.

The gravity of the position has been borne out strongly by the figures that have been cited, especially by Opposition Members. Apart from unemployment, the small number of job vacancies is disturbing: about 29 applicants are chasing each vacancy. A couple of weeks ago, one of my local papers—The Journal (Newcastle)—stated that a staggering 3,000 people were chasing jobs in a new supermarket that was being opened in Whitley bay, Tyne and Wear. The company concerned soon ran out of job application forms, which is a sad reflection on the provision of job opportunities not just in that part of the country, but in almost all other parts.

A striking feature of the current unemployment level is that it clearly affects all areas, not just those that have been traditionally saddled with the scourge of unemployment. My hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) cited Basildon; let me cite Colchester, in whose travel-to-work area unemployment has increased by 171 per cent. in 18 months. It is estimated that it will grow by a further 19 per cent. by December next year, which is a higher rise than that predicted for Britain as a whole. The Essex men and women who voted Tory at the election—fortunately not all did—must rue the day that they helped the Government back into office.

It seems that the Government have cured our deep-seated regional problems by presiding over an economy in which all regions are now experiencing economic decline. That came home to me dramatically this week when I, a Tyneside Member of Parliament, received a plea to support assisted area status for East Sussex. As parts of East Sussex and Kent scramble for assisted area status, I wonder how long it will be before the entire country asks for it. The sad fact that all areas of the country are experiencing unemployment does not mean that the Government are absolved from producing an active regional policy. My colleagues and I believe that such a policy is still important.

I was glad that the hon. Member for Beaconsfield mentioned the work of the Welsh Development Agency, but I was rather surprised that the hon. Member for Langbaurgh (Mr. Bates), when referring to the Northern Development Company, did not explain that the Government were originally hostile to that initiative. It was formed by the local authorities, businesses in the north and the trade unions. It was only as it became successful that the Government decided to support it. Regional policy is important, and I pay tribute to the other development agencies which have done much valuable work. The Government should follow our advice on regional policy by expanding the agencies' work and should bring about economic decentralisation, which is badly needed.

It has been pointed out today that all sectors of our economy have been losing out badly. Unlike the deep recession experienced in the early 1980s, all parts of the country and all sectors are now affected. The job losses which have already occurred in the banking sector and those which are predicted in that sector in the next couple of years will total about 250,000, which is a huge number in a sector on which, we are told, we would be relying for the future.

What remains of our manufacturing and industrial base is also being savagely hit. That was made evident in some of my hon. Friends' speeches, for example, those of my hon. Friends the Members for Birkenhead (Mr. Field) and for Wallasey (Ms. Eagle) who spoke in some detail and with great feeling about the plight of the Cammell Laird shipyard—sentiments with which I wish to associate myself. It is a tragedy that the yard is closing at this time. The Government should intervene to allow the work force to put into practice their ideas for the continuation of the yard.

What my hon. Friends said was backed up by my hon. Friend the Member for Barrow and Furness (Mr. Hutton) who also discussed the problems facing his area and the defence industry, on which his town is almost wholly reliant. I believe that VSEL at Barrow and Cammell Laird and companies such as Swan Hunter would benefit considerably from Government intervention on their behalf. There are practical measures which the Government could take to help such companies. They could, for example, reopen with the European Community the issue of whether warship yards can get access to intervention funding. We should like the Government to take that step.

Some hon. Members—Conservative and Labour—referred to the coal industry and mentioned their fears for the future. Of course, that issue is very much on our minds at present.

Photo of Mr Jack Thompson Mr Jack Thompson , Wansbeck

Is my hon. Friend aware that coal mining areas will not only lose 100,000 jobs and that we shall have to depend on wives working to keep the homes going but that the wives are also losing their factory jobs?

Photo of Ms Joyce Quin Ms Joyce Quin , Gateshead East

My hon. Friend is entirely right. Perhaps the Minister will give us an estimate of the total number of job losses if the pit closure programme were to go ahead. We know that not only the 30,000 jobs but many related jobs and jobs belonging to the families of miners and the communities in which they live will also be lost. We should like the Government publicly to apologise to the miners whom they were prepared to see made redundant with only two days' notice. Do the Government understand how that decision shocked public opinion, not only here but in parts of the European Community and even in the United States where the decision was widely reported?

The constituents to whom I have talked have a gut reaction about the decision on the coal industry. They ask how the Government can possibly allow such a valuable national resource to be thrown away. They ask whether the Government really care about the unemployed when they were prepared to add 30,000 people to the dole queue in such a cavalier and dismissive manner.

Hon. Members have referred to the plight of particular groups of the unemployed. They have referred to the long-term unemployed and to the alarming rise in their number. Although I was glad to hear the Secretary of State announce some measures for the long-term unemployed, I should like her to increase her efforts in that respect. Long-term unemployment is a terrible scourge in our society. There are ways in which the Government and the various agencies could prevent unemployed people from becoming long-term unemployed. The Government need to respond in detail to some of the initiatives proposed by bodies such as the Council of Europe.

Many hon. Members mentioned the alarming problem of youth unemployment. I quote a figure given to me by Tyneside training and enterprise council. The council says that 26 per cent. of people aged between 18 and 24 have no previous work experience. That depressing figure shows how difficult it is for youngsters to get work experience in the middle of a recession when so many companies are sacking people rather than taking them on.

Another aspect of unemployment is the position of older workers who are trying to gain employment. It was depressing when I talked last week to a constituent, a lively and skilled man in his early 50s, who has written literally thousands of job applications. He has often not even had a response. In the days of the citizens charter it should perhaps at least be incumbent on employers to respond to people who send applications to them.

My hon. Friend the Member for Holborn and St. Pancras referred to women in the labour market. Women are also losing out badly in the recession. As my hon. Friend the Member for Newham, North-East (Mr. Leighton) said, we must remember that the official statistics underestimate the number of women who are unemployed. The Government should take the position of women in the labour market firmly into consideration. It would help if the Secretary of State and employment Ministers talked to people at the Equal Opportunities Commission in Manchester which, I understand, they have not visited in recent months.

Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield

Has the hon. Lady seen the results of the 1991 census which show a huge increase over 1981 in the number of adult women now in the work force?

Photo of Ms Joyce Quin Ms Joyce Quin , Gateshead East

We know that there has been a big increase in women's employment, especially in part-time employment and, unfortunately for many women, in low-paid employment about which it would be nice to hear some concern from Conservative Members.

Many of my hon. Friends have mentioned working conditions. Indeed, we could have a whole debate on that worrying subject. If Ministers look at all the various early-day motions on the Order Paper, they will see that many express hon. Members' concern about the poor working conditions in Britain today. It is depressing that the Government seem to want to compete in Europe on the basis of poor working conditions and poor wages. I do not believe that that is the way forward and I believe that the Opposition's message has been clear. We want unemployment to be halted, but we also want the best future for Britain in high-quality and high-skill jobs, and not in low-paid jobs in sweatshop conditions.

Photo of Ms Joyce Quin Ms Joyce Quin , Gateshead East

No, I will not give way again to the hon. Gentleman. I am short of time because many speakers wanted to take part in the debate. That has left my time rather short.

I refer the Government to the interesting debate in another place on unemployment. There was an impressive degree of unity on all sides of that Chamber about the measures needed to tackle unemployment. Contrary to what some Conservative Members have said tonight, the Opposition have proposed many measures that we feel would help tackle the current unemployment problem.

It was clear in the other place that a boost to the construction industry was the most hopeful way forward. That point was echoed in Labour's alternative autumn statement. We proposed a boost to the construction industry far in excess of the rather timid measures proposed in the Government's autumn statement.

A boost to the construction industry is considered to be a better way forward than other ways to revive the economy upon which the Government have tended to rely in the past—for example, consumer spending. It is hard to imagine that consumer spending will get us out of the recession. Too many people who bought on credit have had their fingers badly burnt. Given the poor state of our industrial base, a consumer revival would also tend to be spent on imported goods.

It is also unrealistic to expect the private housing market to pick up and provide a boost. In the midst of a recession and at a time of record housing repossessions, people are hardly in the business of purchasing new houses. A programme of public works, construction and infrastructure referred to by many Opposition Members is very important for the future. The Government should do a great deal more in that respect.

The Government should also join their European colleagues in providing a similar boost to construction and infrastructure in Europe as a whole. My hon. Friend the Member for Birkenhead said that he thought we should have a renewed Marshall plan in Europe. When I consider the problems in eastern Europe and, in particular, the tremendous environmental degradation in those countries, I would like to see an environmental Marshall plan in which many countries join together in a trade-and-aid package to improve the environment of eastern Europe.

Companies in Britain would be in a good position to take advantage of such a plan. It is unrealistic to expect eastern European countries to have the hard currency to buy products, but such a trade-and-aid package would be useful in future and is something that we should consider very seriously.

The Secretary of State referred to discussions in the European Council of Ministers and admitted that, for the first time, there was serious discussion about unemployment at the Social Affairs Council just a few days ago. We believe that that is an incredible admission. The British presidency should have been pushing unemployment from the moment that we assumed the presidency in June.

The Minister of State, Department of Employment said in June that our first priority must be to ensure that there are measures to create jobs".—[Official Report, 9 June 1992; Vol. 209, c. 133.] It is now December and precious little seems to have been achieved. We can only hope that the Edinburgh summit will produce something in that respect.

Photo of Mr Graham Riddick Mr Graham Riddick , Colne Valley

Will the hon. Lady give way on that point?

Photo of Ms Joyce Quin Ms Joyce Quin , Gateshead East

I am afraid not, because time is short and the Minister needs time to reply.

My colleagues made a great deal of the great social cost of unemployment. They referred to the strain on families and the soul-destroying effect on communities. The relationship between unemployment and crime was also mentioned. As usual, Conservative Members pooh-poohed that and tried to claim that we were equating the unemployed with criminals.

It was refreshing that in a recent debate in the other place, the Government spokesman stated clearly that there is a strong link between unemployment and crime. I am far from suggesting that the unemployed are criminals, as I see too many unemployed people in my constituency who are victims of crime rather than perpetrators of crime. However, I believe that crime can and does flourish in conditions of unemployment, poverty and desperation.

Having listened to the contributions of Conservative Members, I am far from convinced that the Government appreciate the sheer scale and acute gravity of the situation that faces us. It is very difficult to see the Government's economic strategy or their strategy for tackling unemployment. Their previous economic theories have failed and have been replaced by uncertain and tentative measures of the kind outlined in the autumn statement. The slogan "There is no alternative" has been replaced by "There is no direction." However, there has been some stealing of Labour's clothes. Perhaps it is the Government's new strategy to steal Labour's clothes. It is the only strategy that I can find in the current circumstances.

The Minister may have seen the current issue of Scottish Business Insider in which various fund managers talk about current economic policy. Mr. Maclean, the managing director of Scottish Value Managements, made this point about the stealing of Labour's clothes: "They"—the Government— already seem to be raking over the Labour manifesto knowing … that there's going to be a tremendous social and fiscal concern as redundancies rise … I think what we may see is a Government that's incorporating a lot more of Labour's policy into its programme over the next few years. The general public will believe the genuine article rather than the pale imitation.

Even more tragically, the Government could have invested in our country when they were running a huge surplus. If they had invested in infrastructure and so on in the years when we were running a budget surplus, we would be better able to withstand the recession and the economic and social effects of it. If we had taken the necessary measures in more prosperous times, when we were running a budget surplus and had the profits from the North sea, we would not be in the difficult position that we are at present. The Government did not take the necessary measures when they should have done, and for that they will not be forgiven.

The Conservative party's election promises on the economy, which were made only six months ago, have been shown to be an absolute sham, and the Government have been totally discredited. The Government should admit their failure, apologise to the electorate and preferably go to the country again before they do any more damage.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling 9:41 pm, 8th December 1992

I agree with the hon. Member for Gateshead, East (Ms. Quin) about the difficulties of giving youngsters the opportunity for placements in a recession. I also agree with what she said about the discrimination that exists against older workers. My only disappointment is that while she was in the European Parliament she was unable to get the European institutions which still place age limits in their advertisements for recruitment to change their policy. Frankly, to see the European Commission and other institutions advertising for all sorts of people at all levels, saying that people over the age of 35 need not apply, is not only distressing for those of us over the age of 35 but completely unacceptable.

The hon. Lady' s speech was interesting because it revealed a new type of snobbery on the Labour Benches. Opposition Members are part-time snobs who sneer at part-time jobs. Part-time jobs are every bit as good as any other jobs. The vast majority of people with part-time jobs say in survey after survey that they would prefer to have part-time jobs. [Interruption.] The hon. Member for Holborn and St. Pancras (Mr. Dobson) is muttering. He complained about Conservative Members having more than one job, and falsely accused my hon. Friend the Member for Amber Valley (Mr. Oppenheim). If the hon. Gentleman is worried about any hon. Member having two jobs, he should put his own backyard in order and deal with those hon. Members who are still Members of the European Parliament.

We have heard much from hon. Members on both sides about unemployment. Families all around the country—those in work and those out of work—are gravely worried about the present position. I very much share the strength of feeling and the sympathy that has gone out to those who are affected. I understand the pressures, uncertainties and unhappiness that unemployment can bring.

Unemployment is a problem which Governments across Europe face, and it arises from a recession which is world wide. The Government are clear about what we must do. We must help our companies to compete in world markets. That means getting inflation down, controlling public expenditure and creating a stable economic framework and opportunities for unemployed people to improve their skills and get back into work. We start from a firm base.

I know that Opposition Members cannot bear to hear good news about the economy. Let me give the hon. Members for Wallasey (Ms. Eagle) and for Coventry, South-East (Mr. Cunningham) a few facts. The United Kingdom has a higher proportion of its adult population in work than any other EC country except Denmark. Employment has grown in the United Kingdom by 1·8 million during the nine years that I have been a Member of Parliament. But I heard no references to that striking growth in job opportunities in any of the speeches made by Opposition Members.

In the decade which was dominated by the last Labour Government, self-employment stagnated. In the Conservative decade of the 1980s, it grew by more than 1 million. None of that happened by magic. It happened because the Conservative party knows that jobs are created by the initiative of business and the commitment of those who work in those businesses. Jobs can come only from incentives, competitiveness, efficiency and enterprise.

The Opposition pretended tonight that they could create jobs if only they were in government. They would tax; that would destroy jobs. They would increase interest rates; that would destroy jobs. They would regulate and interfere; that would destroy jobs. The only jobs that they would create would be jobs for the boys, which the Leader of the Opposition has discovered in his constituency, as my hon. Friend the Member for Colne Valley (Mr. Riddick) said.

Our way is to work with business and to work for individuals. We fought to remove the burden of outdated and unnecessary legislation and regulation which is so corrosive of opportunities for employment.

Photo of Henry McLeish Henry McLeish , Central Fife

What about the donation to Tory party funds from Thames Water?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

When Thames Water was a nationalised concern it was inefficient. It is now so successful that the Opposition plan to tax it to pay for the promises that they make every day of the week.

We had to put in place effective and innovative ways of helping unemployed people back to work. We are not and we shall not be complacent. That is why my right hon. Friend the Secretary of State for Employment has announced half a million more opportunities to help those who are unemployed.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

The hon. Gentleman asks where is the cash. Opposition Members are always interested in cash. They are interested in the input, but never in the output. We are concerned about what comes out at the end. I am talking about half a million new opportunities through job clubs, training and assistance to start up in business. That is direct help, yet it was not even acknowledged by the Opposition tonight, with the honourable exception of the hon. Member for Birkenhead (Mr. Field).

The Opposition's record does not bear examination. How many places did they provide for young people? They provided just 9,000 training places for young people at a time when, because of the 1960s baby boom, more youngsters were entering the labour market than at any time in recent history. We provided 290,000 places. So let us have no more lectures from Opposition Members about what we need to do.

Of course, losing a job is a traumatic experience. But most people remain unemployed for a relatively short period—[HON. MEMBERS: "Not true".] I do not know how Opposition Members expect to build up the confidence of people who have lost their job by making remarks like that. The fact is that two thirds of those who become unemployed leave the register within six months. That is thanks to the excellent work carried out by the Employment Service throughout Britain. What a pity that no Opposition Members felt it appropriate to pay tribute to the excellent work that those people do.

Some people have real difficulty in finding work. They are entitled to expect extra support and help. Some have particular difficulties with literacy and numeracy. As I confirmed to the hon. Member for Liverpool, Mossley Hill (Mr. Alton), help with literacy and numeracy is part of the package introduced by my right hon. Friend the Secretary of State.

For the long term, the Government's education reforms offer hope for the next generation. That hope would have been extinguished if the Opposition, supporting the teaching unions, had had their way. We face increasing worldwide competition from not only our traditional competitors but the expanding economies of South America and the Pacific rim. Worldwide competition needs to be beaten by a working population with ever-increasing levels of skill and maximum adaptability.

My hon. Friend the Member for Chesham and Amersham (Mrs. Gillan) rightly highlighted the importance of small businesses as the engine of job creation, and the fact that interest rate reductions brought about by my right hon. Friend the Chancellor of the Exchequer have been of the greatest importance to them. I agree with her citicism of the European Community which has concentrated on adding to the burdens on business as part of its social affairs programme instead of focusing on the needs of the unemployed and the means for creating jobs. During her presidency of the Council, my right hon. Friend the Secretary of State has changed that, and I am sorry that Opposition Members felt unable to give her credit for that singular achievement.

The hon. Member for Mossley Hill emphasised the importance of the maxim, "The devil makes work for idle hands." That is why it is so important that young people are either in work, training or education and that they are not able to claim benefit, with nothing to apply themselves to, as Opposition Members have argued.

My hon. Friend the Member for Gillingham (Mr. Couchman) told us of his experience as an employer and confirmed that wages councils destroy jobs. He also highlighted the importance of the pharmaceutical industry. My hon. Friend the Member for Hertfordshire, North (Mr. Heald) drew attention to the fact that there are fewer employment opportunities for young people and women in EC countries that have enforced policies favoured by the Labour party.

The hon. Member for Barrow and Furness (Mr. Hutton) spoke of his concern for employment and the importance of work for the shipyards. I could not help thinking how relieved he must have been that a Labour Government did not take office as the fourth Trident, on which so many of his constituents depend, would have been cancelled.

Photo of John Hutton John Hutton , Barrow and Furness

Does the Minister not agree that it was the opinion of my constituents that their best prospect for secure employment would be the return of a Labour Government in April, because they elected a Labour Member of Parliament?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

I recall the hon. Gentleman bouncing into the headlines during the election campaign, by contradicting the shadow Foreign Secretary and saying that it was rubbish that Labour would cancel Trident, so I am not convinced by his protestations.

The hon. Member for Birmingham, Selly Oak (Dr. Jones) called for tax increases to fund increased public expenditure, but last month the hon. Member for Dunfermline, East (Mr. Brown) said: We are not proposing to raise income tax or national insurance at this stage. Further increases at this time would be a mistake. The hon. Lady should sort out her position with that of the Labour Front Bench. I agree with the hon. Member for Dunfermline, East in his assessment of how disastrous tax increases would be, but I sympathise with the hon. Lady who cannot see where the money to pay for the hon. Gentleman's promises will come from. Perhaps she shares the views of the hon. Member for Hackney, South and Shoreditch (Mr. Sedgemore), who in The Guardian accused the shadow Chancellor of not understanding the elementary laws of arithmetic. I shall leave the hon. Lady to sort that matter out.

Photo of Lynne Jones Lynne Jones , Birmingham, Selly Oak

It is right that Labour should continue its policy of advocating an increase in taxation for those who received the highest tax benefits as a result of past Government policies. However, I understand that that issue is to be considered by the Commission for Social Justice and then we shall return with our policies on the issue.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

The hon. Lady's problem is that she supports one tax policy while the hon. Member for Dunfermline, East supports another, but she should not be too concerned about that, as it has been a traditional position in the Labour party for four successive general election losses.

The hon. Member for Birkenhead welcomed the Labour Front-Bench's commitment to full employment but said, rather honestly, that that was the easy part and that the party had to work out the policies to deliver that or face a fifth election defeat. I fear that he may be disappointed. He spoke movingly of the desperate problems in his constituency and of the situation at Cammell Laird, the details of which I shall pass on to my right hon. and learned Friend the Secretary of State for Defence.

Only once in one lifetime of 70 years have a Labour Government managed to leave office without having doubled unemployment. It is rather like Haley's comet—one gets to see it only once in a lifetime. Since 1979, Opposition Members have opposed every training programme we have introduced and criticised every measure that we have taken to help the unemployed get back to work. They opposed employment training, youth training, employment action and now they appear to be opposed to training for work.

Every new training initiative since 1979 has been greeted by a chorus of condemnation at trade union conferences, and when the organ grinder cranks out the familiar tune, the monkey leaps into action. The trade union that has invariably taken the lead has been the Transport and General Workers Union, the biggest union in the country and the union which sponsors the hon. Member for Gateshead, East.

What policies do Opposition Members claim to have to reduce unemployment? When Opposition spokesmen appear on television, they talk airily about an industrial strategy. What do they mean? They are afraid to tell us, but we know what they mean. They mean a return to the massive, wasteful subsidies of the 1970s, subsidies paid at the behest of trade union leaders to firms, preferably in the public sector, to persuade them to produce goods and services that nobody wants to buy.

When Opposition Members talk of industrial strategy, they mean interference in the plans of private sector companies, in the spirit that the man in Whitehall always knows best.

That is not all, for it would mean a training levy on all employers, a tax on jobs and a national minimum wage which even the Fabian Society estimates would cost 800,000 jobs—and would cut 2 million jobs if the trade unions ensured that existing pay differentials were preserved.

Of course, Opposition Members are committed to accept each and every proposal for a new job-destroying regulation that comes out of Brussels—the social charter, the social action programme and now the social chapter of the Maastricht treaty. The Opposition would embrace them all, no matter what the price in lost jobs and inward investment. If it advances socialism, no price is too high for them.

There are 17 million unemployed people in the European Community. The Opposition's response is to raise the cost of creating new jobs right across the Community, to impose new burdens on employers and to smother enterprise in a mass of new regulations. The truth is that the Opposition have nothing to offer Britain. That is why they have lost four general elections in a row.

The policies that the Opposition opposed in the past—the sale of council houses and the privatisation of loss-making state enterprises—have all proved successful. They respond not by admitting their mistakes but by threatening to tax the profits of the new successful enterprises and thus threaten their growth and employment.

Opposition Members attack the Government for controlling the spending of receipts from council house sales, receipts that would not even be there if they had had their way.

Their former leader, the right hon. Member for Islwyn (Mr. Kinnock), let the cat out of the bag during an interview on BBC2 last Saturday. He admitted that the Labour party's promise in the 1987 general election to create 1 million new jobs in two years by a massive programme of public expenditure was "appealing but not believable."

What the right hon. Gentleman did not seem to realise, in common with Opposition Members tonight, was that after the general election in 1987, unemployment fell by more than 1 million in less than two years. It did so without any of Labour's crushingly expensive new programmes. We did it by ensuring that the economic conditions were right for the creation of new jobs, by keeping taxes and public expenditure down, by deregulation and by reducing burdens on business.

What we have heard from the Opposition Benches in this debate has been simply a relentless and systematic attempt to paint the most pessimistic picture of the current employment situation. It is the privilege of Opposition Members to whinge and moan, but I say in all seriousness that they have done no service to the unemployed of this country by taking such a narrow, partisan approach in the debate.

It is time that the Opposition recognised that the only way to reduce unemployment is through the creation of new jobs, which depend on British companies making and selling the goods and services that people want to buy. New jobs depend on companies overseas investing in this country.

Let Labour Members leave the House with their former leader's judgment ringing in their ears—"appealing but not believable".

Question put, That the original words stand part of the Question:—

The House divided: Ayes 276, Noes 309.

Division No. 97][10 pm
AYES
Abbott, Ms DianeChisholm, Malcolm
Adams, Mrs IreneClapham, Michael
Ainger, NickClark, Dr David (South Shields)
Ainsworth, Robert (Cov'try NE)Clarke, Eric (Midlothian)
Allen, GrahamClelland, David
Alton, DavidClwyd, Mrs Ann
Anderson, Donald (Swansea E)Coffey, Ann
Anderson, Ms Janet (Ros'dale)Cohen, Harry
Armstrong, HilaryConnarty, Michael
Ashdown, Rt Hon PaddyCook, Frank (Stockton N)
Ashton, JoeCook, Robin (Livingston)
Austin-Walker, JohnCorbyn, Jeremy
Banks, Tony (Newham NW)Corston, Ms Jean
Barnes, HarryCousins, Jim
Barron, KevinCox, Tom
Battle, JohnCryer, Bob
Bayley, HughCunliffe, Lawrence
Beckett, MargaretCunningham, Jim (Covy SE)
Beggs, RoyDafis, Cynog
Beith, Rt Hon A. J.Darling, Alistair
Bell, StuartDavidson, Ian
Benn, Rt Hon TonyDavies, Bryan (Oldham C'tral)
Bennett, Andrew F.Davies, Rt Hon Denzil (Llanelli)
Benton, JoeDavies, Ron (Caerphilly)
Bermingham, GeraldDavis, Terry (B'ham, H'dge H'l)
Berry, Dr. RogerDenham, John
Betts, CliveDewar, Donald
Blair, TonyDixon, Don
Blunkett, DavidDobson, Frank
Boateng, PaulDowd, Jim
Boyce, JimmyDunnachie, Jimmy
Bradley, KeithDunwoody, Mrs Gwyneth
Bray, Dr JeremyEagle, Ms Angela
Brown, Gordon (Dunfermline E)Eastham, Ken
Brown, N. (N'c'tle upon Tyne E)Enright, Derek
Bruce, Malcolm (Gordon)Etherington, Bill
Burden, RichardEvans, John (St Helens N)
Byers, StephenEwing, Mrs Margaret
Caborn, RichardFatchett, Derek
Campbell, Mrs Anne (C'bridge)Faulds, Andrew
Campbell, Menzies (Fife NE)Field, Frank (Birkenhead)
Campbell, Ronnie (Blyth V)Fisher, Mark
Campbell-Savours, D. N.Flynn, Paul
Canavan, DennisFoster, Derek (B'p Auckland)
Cann, JamieFoster, Don (Bath)
Carlile, Alexander (Montgomry)Foulkes, George
Fraser, JohnMahon, Alice
Fyfe, MariaMandelson, Peter
Galbraith, SamMarshall, David (Shettleston)
Galloway, GeorgeMarshall, Jim (Leicester, S)
Gapes, MikeMartin, Michael J. (Springburn)
Garrett, JohnMartlew, Eric
George, BruceMaxton, John
Gerrard, NeilMeacher, Michael
Gilbert, Rt Hon Dr JohnMeale, Alan
Godman, Dr Norman A.Michael, Alun
Godsiff, RogerMichie, Bill (Sheffield Heeley)
Golding, Mrs LlinMichie, Mrs Ray (Argyll Bute)
Gordon, MildredMilburn, Alan
Gould, BryanMiller, Andrew
Graham, ThomasMitchell, Austin (Gt Grimsby)
Grant, Bernie (Tottenham)Moonie, Dr Lewis
Griffiths, Nigel (Edinburgh S)Morgan, Rhodri
Griffiths, Win (Bridgend)Morley, Elliot
Grocott, BruceMorris, Rt Hon A. (Wy'nshawe)
Gunnell, JohnMorris, Estelle (B'ham Yardley)
Hain, PeterMorris, Rt Hon J. (Aberavon)
Hall, MikeMowlam, Marjorie
Hanson, DavidMudie, George
Hardy, PeterMullin, Chris
Harman, Ms HarrietMurphy, Paul
Hattersley, Rt Hon RoyOakes, Rt Hon Gordon
Henderson, DougO'Brien, Michael (N W'kshire)
Heppell, JohnO'Brien, William (Normanton)
Hill, Keith (Streatham)O'Hara, Edward
Hinchliffe, DavidOlner, William
Hoey, KateO'Neill, Martin
Hogg, Norman (Cumbernauld)Orme, Rt Hon Stanley
Home Robertson, JohnParry, Robert
Hood, JimmyPendry, Tom
Hoon, GeoffreyPickthall, Colin
Howarth, George (Knowsley N)Pike, Peter L.
Howells, Dr. Kim (Pontypridd)Pope, Greg
Hoyle, DougPowell, Ray (Ogmore)
Hughes, Kevin (Doncaster N)Prentice, Ms Bridget (Lew'm E)
Hughes, Robert (Aberdeen N)Prentice, Gordon (Pendle)
Hughes, Roy (Newport E)Prescott, John
Hughes, Simon (Southwark)Primarolo, Dawn
Hutton, JohnPurchase, Ken
Illsley, EricQuin, Ms Joyce
Ingram, AdamRadice, Giles
Jackson, Glenda (H'stead)Randall, Stuart
Jackson, Helen (Shef'ld, H)Raynsford, Nick
Jamieson, DavidRedmond, Martin
Janner, GrevilleRobertson, George (Hamilton)
Jones, Barry (Alyn and D'side)Robinson, Geoffrey (Co'try NW)
Jones, Lynne (B'ham S O)Roche, Mrs. Barbara
Jones, Martyn (Clwyd, SW)Rogers, Allan
Jowell, TessaRooker, Jeff
Kaufman, Rt Hon GeraldRooney, Terry
Kennedy, Charles (Ross,C&S)Ross, Ernie (Dundee W)
Kennedy, Jane (Lpool Brdgn)Ross, William (E Londonderry)
Khabra, Piara S.Rowlands, Ted
Kilfoyle, PeterRuddock, Joan
Kinnock, Rt Hon Neil (Islwyn)Salmond, Alex
Kirkwood, ArchySedgemore, Brian
Leighton, RonSheerman, Barry
Lestor, Joan (Eccles)Sheldon, Rt Hon Robert
Lewis, TerryShore, Rt Hon Peter
Litherland, RobertShort, Clare
Livingstone, KenSimpson, Alan
Lloyd, Tony (Stretford)Skinner, Dennis
Llwyd, ElfynSmith, Andrew (Oxford E)
Loyden, EddieSmith, C. (Isl'ton S & F'sbury)
Lynne, Ms LizSmith, Rt Hon John (M'kl'ds E)
McAllion, JohnSmith, Llew (Blaenau Gwent)
McAvoy, ThomasSnape, Peter
McCartney, IanSoley, Clive
McKelvey, WilliamSpearing, Nigel
Mackinlay, AndrewSpellar, John
McLeish, HenrySquire, Rachel (Dunfermline W)
Maclennan, RobertSteel, Rt Hon Sir David
McMaster, GordonSteinberg, Gerry
McNamara, KevinStevenson, George
McWilliam, JohnStott, Roger
Madden, MaxStrang, Dr. Gavin
Taylor, Mrs Ann (Dewsbury)Wigley, Dafydd
Tipping, PaddyWilliams, Rt Hon Alan (Sw'n W)
Trimble, DavidWilliams, Alan W (Carmarthen)
Turner, DennisWilson, Brian
Tyler, PaulWinnick, David
Vaz, KeithWise, Audrey
Walker, Rt Hon Sir HaroldWorthington, Tony
Wallace, JamesWray, Jimmy
Walley, JoanWright, Dr Tony
Wardell, Gareth (Gower)Young, David (Bolton SE)
Wareing, Robert N
Watson, MikeTellers for the Ayes:
Welsh, AndrewMr. Jack Thompson and Mr. Jon Owen Jones.
Wicks, Malcolm
NOES
Adley, RobertCope, Rt Hon Sir John
Ainsworth, Peter (East Surrey) Cormack, Patrick
Aitken, JonathanCouchman, James
Alexander, RichardCran, James
Alison, Rt Hon Michael (Selby)Currie, Mrs Edwina (S D'by'ire)
Allason, Rupert (Torbay)Curry, David (Skipton & Ripon)
Amess, DavidDavies, Quentin (Stamford)
Ancram, MichaelDavis, David (Boothferry)
Arbuthnot, JamesDay, Stephen
Arnold, Jacques (Gravesham)Deva, Nirj Joseph
Arnold, Sir Thomas (Hazel Grv)Devlin, Tim
Ashby, DavidDickens, Geoffrey
Aspinwall, JackDorrell, Stephen
Atkins, RobertDouglas-Hamilton, Lord James
Atkinson, David (Bour'mouth E)Dover, Den
Atkinson, Peter (Hexham)Duncan, Alan
Baker, Rt Hon K. (Mole Valley)Duncan-Smith, Iain
Baker, Nicholas (Dorset North)Dunn, Bob
Baldry, TonyDurant, Sir Anthony
Banks, Robert (Harrogate)Dykes, Hugh
Bates, MichaelEggar, Tim
Batiste, SpencerElletson, Harold
Bendall, VivianEmery, Sir Peter
Beresford, Sir PaulEvans, David (Welwyn Hatfield)
Biffen, Rt Hon JohnEvans, Jonathan (Brecon)
Body, Sir RichardEvans, Nigel (Ribble Valley)
Bonsor, Sir NicholasEvans, Roger (Monmouth)
Booth, HartleyEvennett, David
Bottomley, Peter (Eltham)Faber, David
Bottomley, Rt Hon VirginiaFabricant, Michael
Bowden, AndrewFairbairn, Sir Nicholas
Bowis, JohnFenner, Dame Peggy
Boyson, Rt Hon Sir RhodesField, Barry (Isle of Wight)
Brandreth, GylesFishburn, Dudley
Brazier, JulianForman, Nigel
Bright, GrahamForsyth, Michael (Stirling)
Brooke, Rt Hon PeterForth, Eric
Brown, M. (Brigg & Cl'thorpes)Fowler, Rt Hon Sir Norman
Browning, Mrs. AngelaFox, Dr Liam (Woodspring)
Bruce, Ian (S Dorset)Fox, Sir Marcus (Shipley)
Budgen, NicholasFreeman, Roger
Burns, SimonFrench, Douglas
Burt, AlistairFry, Peter
Butcher, JohnGale, Roger
Butler, PeterGallie, Phil
Butterfill, JohnGardiner, Sir George
Carlisle, John (Luton North)Garel-Jones, Rt Hon Tristan
Carlisle, Kenneth (Lincoln)Garnier, Edward
Carrington, MatthewGill, Christopher
Carttiss, MichaelGillan, Cheryl
Cash, WilliamGoodson-Wickes, Dr Charles
Channon, Rt Hon PaulGorman, Mrs Teresa
Chaplin, Mrs JudithGorst, John
Churchill, MrGrant, Sir Anthony (Cambs SW)
Clappison, JamesGreenway, Harry (Ealing N)
Clark, Dr Michael (Rochford)Greenway, John (Ryedale)
Clarke, Rt Hon Kenneth (Ruclif)Griffiths, Peter (Portsmouth, N)
Clifton-Brown, GeoffreyGrylls, Sir Michael
Coe, SebastianGummer, Rt Hon John Selwyn
Colvin, MichaelHague, William
Congdon, DavidHamilton, Rt Hon Archie (Epsom)
Conway, DerekHamilton, Neil (Tatton)
Coombs, Anthony (Wyre For'st)Hampson, Dr Keith
Coombs, Simon (Swindon)Hanley, Jeremy
Hannam, Sir JohnNelson, Anthony
Hargreaves, AndrewNeubert, Sir Michael
Harris, DavidNewton, Rt Hon Tony
Haselhurst, AlanNicholls, Patrick
Hawkins, NickNicholson, David (Taunton)
Hawksley, WarrenNicholson, Emma (Devon West)
Hayes, JerryNorris, Steve
Heald, OliverOnslow, Rt Hon Cranley
Heath, Rt Hon Sir EdwardOppenheim, Phillip
Heathcoat-Amory, DavidOttaway, Richard
Hendry, CharlesPage, Richard
Heseltine, Rt Hon MichaelPaice, James
Higgins, Rt Hon Terence L.Patnick, Irvine
Hill, James (Southampton Test)Patten, Rt Hon John
Horam, JohnPawsey, James
Hordern, Sir PeterPeacock, Mrs Elizabeth
Howard, Rt Hon MichaelPickles, Eric
Howarth, Alan (Strat'rd-on-A)Porter, Barry (Wirral S)
Howell, Rt Hon David (G'dford)Porter, David (Waveney)
Howell, Ralph (North Norfolk)Portillo, Rt Hon Michael
Hughes Robert G. (Harrow W)Powell, William (Corby)
Hunt, Rt Hon David (Wirral W)Rathbone, Tim
Hunt, Sir John (Ravensbourne)Redwood, John
Hunter, AndrewRichards, Rod
Hurd, Rt Hon DouglasRiddick, Graham
Jack, MichaelRobathan, Andrew
Jackson, Robert (Wantage)Roberts, Rt Hon Sir Wyn
Jenkin, BernardRobertson, Raymond (Ab'd'n S)
Johnson Smith, Sir GeoffreyRobinson, Mark (Somerton)
Jones, Gwilym (Cardiff N)Roe, Mrs Marion (Broxbourne)
Jones, Robert B. (W Hertfdshr)Rowe, Andrew (Mid Kent)
Jopling, Rt Hon MichaelRumbold, Rt Hon Dame Angela
Kellett-Bowman, Dame ElaineRyder, Rt Hon Richard
Key, RobertSackville, Tom
Kilfedder, Sir JamesSainsbury, Rt Hon Tim
King, Rt Hon TomShaw, David (Dover)
Kirkhope, TimothyShaw, Sir Giles (Pudsey)
Knapman, RogerShephard, Rt Hon Gillian
Knight, Mrs Angela (Erewash)Shepherd, Colin (Hereford)
Knight, Greg (Derby N)Shepherd, Richard (Aldridge)
Knight, Dame Jill (Bir'm E'st'n)Shersby, Michael
Knox, DavidSims, Roger
Kynoch, George (Kincardine)Skeet, Sir Trevor
Lait, Mrs JacquiSmith, Sir Dudley (Warwick)
Lamont, Rt Hon NormanSmith, Tim (Beaconsfield)
Lang, Rt Hon IanSoames, Nicholas
Lawrence, Sir IvanSpeed, Sir Keith
Legg, BarrySpencer, Sir Derek
Leigh, EdwardSpicer, Sir James (W Dorset)
Lennox-Boyd, MarkSpicer, Michael (S Worcs)
Lidington, DavidSpink, Dr Robert
Lightbown, DavidSpring, Richard
Lilley, Rt Hon PeterSproat, Iain
Lloyd, Peter (Fareham)Squire, Robin (Hornchurch)
Lord, MichaelStanley, Rt Hon Sir John
Luff, PeterSteen, Anthony
MacKay, AndrewStephen, Michael
Maclean, DavidStern, Michael
McLoughlin, PatrickStewart, Allan
McNair-Wilson, Sir PatrickStreeter, Gary
Madel, DavidSumberg, David
Maitland, Lady OlgaSweeney, Walter
Malone, GeraldSykes, John
Marland, PaulTapsell, Sir Peter
Marlow, TonyTaylor, Ian (Esher)
Marshall, John (Hendon S)Taylor, John M. (Solihull)
Marshall, Sir Michael (Arundel)Taylor, Sir Teddy (Southend, E)
Martin, David (Portsmouth S)Thomason, Roy
Mawhinney, Dr BrianThompson, Sir Donald (C'er V)
Mellor, Rt Hon DavidThompson, Patrick (Norwich N)
Merchant, PiersThurnham, Peter
Milligan, StephenTownend, John (Bridlington)
Mills, IainTownsend, Cyril D. (Bexl'yh'th)
Mitchell, Andrew (Gedling)Tracey, Richard
Mitchell, Sir David (Hants NW)Tredinnick, David
Moate, RogerTrend, Michael
Monro, Sir HectorTwinn, Dr Ian
Montgomery, Sir FergusVaughan, Sir Gerard
Moss, MalcolmViggers, Peter
Needham, RichardWalden, George
Walker, Bill (N Tayside)Willetts, David
Waller, GaryWilshire, David
Ward, JohnWinterton, Mrs Ann (Congleton)
Wardle, Charles (Bexhill)Winterton, Nicholas (Macc'f'ld)
Waterson, NigelWolfson, Mark
Watts, JohnWood, Timothy
Wells, BowenYeo, Tim
Wheeler, Sir JohnYoung, Sir George (Acton)
Whitney, Ray
Whittingdale, JohnTellers for the Noes:
Widdecombe, AnnMr. Tim Boswell and Mr. Sydney Chapman.
Wiggin, Jerry
Wilkinson, John

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments) and agreed to.

MADAM SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,That this House recognises the need for the United Kingdom economy to remain competitive at a time of world recession; rejects the job destroying policies of Her Majesty's Opposition including the national minimum wage; notes that the United Kingdom has the second highest proportion of its population in employment of any country in the European Community; congratulates the Government on the new opportunities afforded by the Autumn Statement; and welcomes the Government's new package of 1·5 million employment and training opportunities providing more help than ever before to help unemployed people get back into work.