§ Mr. SpeakerBefore the debate begins I should like to say, in relation to the scope of the Appropriation (No. 2) (Northern Ireland) Order 1982, that it will not be in order to discuss police or general security matters. The order covers only Northern Ireland Departments and not the Northern Ireland Office. Anything within the schedule to the order can, of course, be discussed.
§ The Minister of State, Northern Ireland Office (Mr. Adam Butler)I beg to move,
That the draft Appropriation (No. 2) (Northern Ireland) Order 1982, which was laid before this House on 21st June, be approved.The order is being made under paragraph 1 of schedule 1 to the Northern Ireland Act 1974. It provides for the appropriation of the balance of the 1982–83 Main Estimates of Northern Ireland Departments and also of the excess Votes for 1980–81. The House will recall that a sum on account for 1982–83 was approved in the Appropriation (Northern Ireland) Order 1982 on 1 March. The House is now being asked to approve a further sum of £1,396,967,800 for 1982–83 in this order, bringing the total for the year to £2,472,366,000.The Main Estimates represent the detailed spending plans of Departments for this financial year. These plans were published in broad outline in the Northern Ireland section of the Government's public expenditure White Paper, Cmnd. 8494, which was presented to the House earlier in this year, and in the statements of 6 January and 10 March by my right hon. Friend the Secretary of State.
Hon. Members will be aware that first priority in the allocation of the resources available to Northern Ireland continues to be given to the industry, trade, energy and employment programmes as part of the Government's strategy to promote the long-term well-being of the Northern Ireland economy. Within the social and environmental programmes, the top priority is attached to housing where a considerable increase in provision has been made in a major bid to improve housing conditions.
Detailed information on the draft order is to be found in the Estimates Volume and the Statement of Excesses, copies of which have been placed in the Vote Office, and in the explanatory memorandum which I have circulated to right hon. and hon. Members representing Northern Ireland constituencies, those who have special responsibility for Northern Ireland matters and others who took part in the last Appropriation order debate.
Before I mention some of the main components of the Estimates provision which is being sought, I should like to draw the attention of the House to two changes which have been made to the format of the Northern Ireland Estimates volume. These reflect similar changes which have been made to the United Kingdom Supply Estimates as recommended by the Treasury and Civil Service Select Committee. The object of these is to make the Estimates generally more informative. I particularly draw attention to the inclusion of an introductory note at the beginning of each Vote putting it in the context of the Department's activities and indicating expenditure trends. These prefaces contain the information which until now has been provided in the explanatory memorandum. In order to 1264 avoid duplication, I therefore intend to discontinue the circulation of a separate explanatory memorandum for future Estimates.
The other change which has been made this year is the provision of figures for the two previous years instead of only one.
In addition to these two changes, the narratives of subheads within the Votes in the Northern Ireland Estimates will be expanded next year to give a fuller explanation of the nature and purpose of the expenditure involved. Some Votes in the United Kingdom Supply Estimates for 1982–83 included these expanded subhead narratives, and the remainder will be changed in 1983–84. For the Northern Ireland Estimates it was decided to wait until 1983–84 and to introduce the expansion in all Votes at that time.
I hope that these changes will make the Estimates volume more useful to hon. Members, and that they will be welcomed for that reason.
The House will remember that my right hon. Friend the former Secretary of State for Northern Ireland told the House last year about his proposals for departmental reorganisation in the Province with a view to making the machinery of government more effective and accountable to his direction and control. The merger of the control functions of the Departments of Finance and of the Civil Service and related changes have been effective since 1 April, and they are reflected in the Vote structure of the Estimates before the House today. The reorganisation of economic development functions will not take place until later this year, and some further Vote reorganisation may be necessary at that stage.
I now refer to some of the main aspects of the draft order.
The House will note that there is a total provision of £60.8 million in Class I of these Main Estimates for agriculture, fisheries and forestry. This provides for the ongoing services of the Department of Agriculture, mainly education, research, advice, measures to effect improvements in livestock, crops and product standards, disease control, and drainage, forestry and fisheries. A sum of about £7 million is provided in Vote 2 for direct support to agriculture.
Hon. Members will recall that last January my right hon. Friend announced that a further £16 million of special aid would be made available during 1982–83 for Northern Ireland agriculture. As I told the House on 1 April, the aid will permit the continuation of the special measures which were introduced in 1981–82, namely, an additional stickler cow subsidy financed by the European Community, and borne on a Ministry of Agriculture, Fisheries and Food Vote, a package of aid to encourage beef cattle production, a milk consumer subsidy, and payments to operators of licensed pig and poultry processing plants and egg packing stations. New measures to be introduced in 1982–83 include a grassland improvement scheme, as I announced on 14 July, and assistance for the seed potato industry. I hope that farmers will take full advantage of the former scheme, especially in respect of drainage and land reclamation, to help improve the quality and yield of one of our few natural resources.
There will also be payment of the recently announced European Community calf subsidy, which will provide additional aid for dairy as well as beef farmers. Only six-month-old calves born after 20 May 1982 will be eligible and, with the pattern of calvings, it is not likely that more 1265 than £1 million or £2 million will be payable in the current financial year. But it is expected that about £5 million will be payable under this scheme in the following year. Clearly that will be of particular benefit in the sectors to which I have referred. I am glad to say that all the indications are that 1981 showed a substantial improvement in farm incomes over the critically low level of 1980. These measures will help a continuation in that improvement in farm incomes and strengthen the confidence in the future which is now beginning to emerge.
I should make it clear that the necessary provision for these measures is not contained in the Estimates now before us, but will be taken in Supplementary Estimates when the detailed provision has been finalised. However, pending approval of the Supplementary Estimates, expenditure on the new services and, to the extent that this proves necessary, on the continuation of the 1981–82 aids will be met by advances from the Northern Ireland Civil Contingencies Fund.
In industry and employment, Class II of the Estimates, hon. Members will be aware of the Government's intentions to establish a new Department of Economic Development, which will amalgamate the functions of the Departments of Commerce and Manpower Services, incorporating within the new Department the Industrial Development Board. It is intended that the IDB should be operational by 1 September 1982, and the new Department of Economic Development by 6 September. To facilitate the smooth transition to the new arrangements from a financial point of view, there are some changes in the Vote structure of the 1982–83 Estimates as compared with those for 1981–82.
Votes 1 and 2 in the current Estimates contain provision for those functions which it is proposed will be overseen by the new Industrial Development Board. The total of approximately £101 million covered by these Votes includes some £15 million for the factory building programme and some £70 million for industrial development grants. Votes 3 and 4 include provision of £54 million for assistance to the aircraft and shipbuilding industries in Northern Ireland which will remain the direct responsibility of the Department of Economic Development rather than the IDB; £8 million for the Local Enterprise Development Unit; and £6 million for the development of the tourist industry in Northern Ireland.
The provision for LEDU represents a significant increase in real terms which reflects the particular importance which the Government attach to small business development. It is noteworthy that, in spite of the difficulties of the economic environment within which it was operating in 1981–82, LEDU promoted more than 1,600 jobs and that in the current year it is aiming to better this figure by more than 15 per cent. The amounts devoted to the industrial development programme generally and the organisational measures which I have described demonstrate the Government's commitment to tackling Northern Ireland's severe and deep-rooted economic problems.
I turn now to the expenditure on the functioning of the labour market proposed in Class II, Vote 5. The present period is a very active one on industrial training. Since the beginning of the year my right hon. Friend has published three important documents on this subject. The first of 1266 these contains the proposals for the comprehensive youth training programme, which is to start in the autumn. Provision of £18 million for the youth opportunities programme and the youth training programme is included in the Estimates for 1982–83, and the cost in the first full year is expected to be about £44 million. The youth training programme will guarantee to all 16-year-olds who cannot find jobs 12 months of full-time training and vocational preparation as well as providing a range of opportunities for other 16 and 17-year-olds both at school and in employment. I believe that it is a programme of really major significance to the Province and one which we are proud to be able to implement in full one year ahead of the comparable schemes in Great Britain.
The second document, a consultative document, was published in June and contained proposals on the future of the Northern Ireland industrial training boards and the Northern Ireland Training Executive. Thirdly, last week a further document was published, setting out the Government's proposals for developing management training in Northern Ireland—a key requirement in the revitalising of the Northern Ireland economy. The whole area of training is thus undergoing close scrutiny, and action is proposed—and in some cases already well advanced—across a wide front.
This is practical, innovative work which should stand Northern Ireland in good stead in seizing opportunities for industrial regeneration, and offers a solid background and support to the work of stimulating new industrial investment and job creation. It demonstrates that the prime work of the Department of Manpower Services is in support of that aspect of the Department of Commerce which, in the reorganisation, will become the Industrial Development Board and is further justification for bringing those two Departments together.
The Northern Ireland work force has generally won for itself a deservedly good reputation. Nevertheless, we cannot afford to have anything but the very best to offer would-be investors: in management, in expertise and skills of all sorts, and in the maturity of attitudes. We attach great importance to those initiatives in training.
Class III in the Estimates relates to energy matters. Detailed discussions and negotiations have taken place with the Republic of Ireland following that Government's initial offer to consider making a supply of natural gas available to Northern Ireland from the Kinsale field. Those negotiations were interrupted by the recent general election in the Republic and have therefore been more protracted than we would have hoped. We have, nevertheless, now achieved a head of understanding on the main terms and conditions, which is currently being considered by both Governments and we hope that we will bring the matter to a conclusion in the near future. However, it will be an expensive project, with heavy capital expenditure and a long pay-back period. The House would expect the Government to be investigating—amongst other matters—the extent to which private money might be involved to reduce the burden on the taxpayer and on public sector borrowing.
§ Mr. William Ross (Londonderry)When the Minister is investigating the cost in the way that he has just expressed, will he investigate how it would compare with the cost of supply from North Sea fields, where there is security of supply?
§ Mr. ButlerI assure the hon. Gentleman that that has been looked at, as he is aware. It was originally turned down, but when we make our announcements we shall refer to alternative sources of supply, both of natural gas and other fuels, and how they would be affected if we were to go ahead with the purchase of gas from the Republic. The hon. Gentleman is right when he says that the purchase of gas from elsewhere has to be considered and cost and other matters taken into account.
§ Rev. Ian Paisley (Antrim, North)Will the Minister explain why, if he is considering keeping the gas industry going in Northern Ireland—I hope that that is true—£4 million is provided for the orderly rundown of the gas industry? Is the gas industry to be run down, or saved?
§ Mr. ButlerThere is provision in the Estimates for the costs of rundown, but they are small. Apart from some essential work, largely due to obsolete, or in some cases dangerous, equipment, the amount of rundown has been halted. That is currently a cost to the Government, because there is a continuing subsidy to the gas undertakings. Clearly it is essential that the rundown of such undertakings, and the related rundown at domestic level, should be halted while we consider the possibility of supply from the Republic. It is a further reason for coming to a conclusion as soon as we can.
Moving on to housing, which is covered in Class V in the Estimates, the provision for housing reflects the high priority that the Government attach to tackling the Province's housing problems. In addition, that gives a welcome and necessary boost to the construction industry. The allocations to the Northern Ireland Housing Executive for capital and revenue expenditure in 1982–83 total about £50 million more than the previously planned levels of expenditure. That substantial increase acknowledges the agreement between the Government and the Housing Executive on the measures necessary to effect both real improvements in physical conditions and a reduction in the urgent waiting lists for accommodation in Northern Ireland.
The current year should see contracts let for about 4,500 new dwellings in the Province, while future new buildings programmes will be planned to achieve 5,250 new starts per year. Expenditure on new building should rise from 1981–82 outturn of £67 million to about £95 million in 1982–83. That will be accompanied by an even greater relative increase in expenditure on improvement to existing dwellings where spending should rise from the 1981–82 level of £35 million to about £60 million in 1982–83.
I should make it clear that I have referred to the total programme of the Northern Ireland Housing Executive, not all of which is borne on this Vote, since the executive's capital expenditure is financed from other sources.
§ Mr. Clive Soley (Hammersmith, North)The Minister has just given a figure of 5,250 as the aim for new starts per annum. Is that to be the long-term aim, or is it planned to increase that figure over a number of years?
§ Mr. ButlerI believe that my hon. Friend the Under-Secretary, who will wind up the debate, can answer that question. The figures that I have just quoted show a dramatic increase over previous years. They compare with the figure for 1979, attributable to the previous Administration, of barely more than 2,000. Through the 1268 additional expenditure we are effectively doubling the number of housing starts that were recorded in the last year that can be attributed to the previous Administration.
I referred to the executive's capital expenditure being financed from other sources. One of those other sources is the executive's highly successful house sales policy—more than 10,000 sales have been completed. That should continue to generate high levels of capital receipts and the executive will be able to apply all of the receipts, estimated at £38 million in 1982–83, in support of its capital programmes. The executive is to be commended for its continuing policy of house sales and the higher levels of programme activity now possible underscore the advantages that such a policy can bring.
I know that the House is particularly anxious to know the position concerning the proposed special aid for housing in Northern Ireland from the European Community. Hon Members will be aware that the regulation confirming this special action failed to achieve agreement at a recent meeting of the Council of Ministers. The Government are extremely disappointed that the regulation, which would bring valuable additional resources to bear on Northern Ireland's housing problems, has not yet been approved. We are, however, grateful for the continuing support of the majority of member Governments for the measure, and we will continue every effort to achieve unanimity on the proposed regulation.
In the meantime, in order to ensure that the new houses to which Community aid will be directed are not delayed, the Housing Executive has been advised to plan its new building programme on the assumption that assistance of the order of £16 million will be available—spread over this and the next two years—towards the cost of commitments entered into in the current year. We have not yet reached the stage where firmer decisions need to be taken. If the regulation is agreed in due course the provision will be included in a Supplementary Estimate.
The Government's commitment to solving Northern Ireland's housing problems is also reflected in the increased allocation for housing associations. Outturn for 1981–82 is estimated at about £21 million and this amount has been increased to £24 million for 1982–83. The voluntary housing movement plays an important role in housing, particularly in inner city improvement, provision for the elderly and the promotion of owner-occupation through equity-sharing.
Class VIII covers the provision for the Department of Education. The provision in the Estimates for the education programme is about £526 million. Of this, there is provision for schools in Votes 1 and 4. Vote 1, which covers teachers' salaries, together with provision for grants for capital expenditure by voluntary schools, amounts to £210 million, and Vote 4, amounting to £193 million, provides for the recurrent and capital expenditure of the education and library boards. Those are significant sums and I think that it would be helpful to the House if I referred to some important factors underlying educational provision.
Until recently, educational policy and the allocation of financial resources to education have been geared to growth, but pupil numbers are falling in Northern Ireland, as elsewhere in the United Kingdom. The reduction is generally at primary level and is very steep indeed in some areas—for example, in Belfast, where the number of primary pupils in 1982 is only two-thirds of the 1974 1269 figure. In controlled secondary schools in Belfast the number of pupils in 1982 is down by one-quarter from 1974 and the decline has only just begun.
Those trends cannot be ignored and we must tackle the problems of contraction to ensure that we match provision to need. In short, rationalisation of school provision must become a predominant concern of policy. It follows that school authorities must also accept the importance of rationalisation, for it seems certain that, as rolls continue to fall and staffing numbers decline, the range and balance of educational opportunity and provision for many pupils will be at risk. Schools will find themselves increasingly unable to provide for the pupil's needs and aspirations from within their own staffing resources and the undesirable consequence of falling standards will be inevitable.
There must, therefore, be movement on rationalisation by our school authorities to allow for an improved pattern of staffing in both the primary and secondary sectors. Unless that can happen, it is unlikely that Northern Ireland's generally good position, as measured by assessment of standards performance, can be maintained.
Turning to the health and personal social services programme, hon. Members will see that we are seeking in Class IX of the Estimates a total net amount of £535.3 million. That represents a significant continuing investment in the health and social well-being of the people of Northern Ireland. In Vote 1, the total provision being sought is £472.1 million for the hospital, community health and personal social services and some centrally funded services. The major element in that provision is the amount of £434.1 million being sought in subhead Al to meet the revenue expenditure of the health and social services boards.
That level of resources is intended to provide for a real increase in expenditure in 1982–83 of 1.5 per cent. Supplemented by the savings produced by the boards' continuing drive for greater efficiency and economies, that will enable development of services to take place to cater for the increasing numbers of elderly people and young people in our community, and to make the best use of advances in medical technology.
The level of resources available for the capital programme will enable us to meet our continuing hospital commitments and to proceed with some priority developments in the community. The provision being sought in Vote 2 will allow for expenditure of £91.5 million on the family practitioner services.
Under Class X, provision has been made for £415.1 million to cover non-contributory benefits, which comprise almost 45 per cent. of total social security benefit expenditure. The remaining 55 per cent. is paid from the national insurance fund, which receives a supplement of £51.9 million from the Consolidated Fund, provided for in Vote 1. In Vote 3, provision amounting to £700,000 has been made to cover the extension of maternity grant to all mothers on a non-contributory basis. The new benefit will be payable in respect of confinements from 4 July 1982. As the House knows, cash social security benefits in Northern Ireland are provided in parity in all respects with the corresponding benefits in Great Britain, and proportionately higher expenditure in the Province reflects and meets our higher levels of need.
1270 I am sure that hon. Members will have noted the provision of £188,000 for the Northern Ireland Assembly in Class XI, Vote 1. The Main Estimates before the House today encompass only those functions of the previous Assembly, such as the provision of library facilities and the salary of the Examiner of Statutory Rules, for which there was a continuing need. A Supplementary Estimate will be required to provide for the costs of a revived Assembly, including the salaries of its Members, the administrative staff and so on. The costs of elections to the Assembly will be borne on a Northern Ireland Office Vote.
§ Mr. K. Harvey Proctor (Basildon)Can my hon. Friend give the House the global cost of the Assembly in, say, its first year of operation?
§ Mr. ButlerI have a figure in my head, but I am not sure about it, and rather than give the wrong figure I shall ask my hon. Friend the Under-Secretary to give the figure to the House. It is available and it is right that the House should know it.
The Department of Finance and Personnel has been set up as a result of the departmental reorganisation. The new Department is responsible for resource planning for the whole range of the Secretary of State's functions in Northern Ireland, for control of both money and manpower in respect of the Northern Ireland Departments, for the other matters which were formerly the responsibility of the Department of the Civil Service and for the Valuation Office, Ulster Savings, the Office of Law Reform and Charities Branch. Provision for all those services, with the exception of superannuation, is made in Class XI, Vote 3 and amounts to about £16 million. I am confident that the merger of those functions is a major step towards improving the machinery of Government in Northern Ireland.
Finally, I should like to mention briefly the excess Votes for 1980–81 which occurred in three Votes and amount in total to £255,056. Detailed explanations of how the excesses arose are contained in the 1980–81 Statement of Excesses to which I have referred. The Public Accounts Committee has raised no objection to these sums being voted. The important point is that overall expenditure by Northern Ireland Departments in 1980–81 remained within the total cash limit.
I think that I have covered the most important features of the draft order. My ministerial colleagues and I will be present for as much of the debate as possible and my hon. Friend the Under-Secretary will reply.
Before I commend the draft order to the House, I should like to conclude with two observations. The sums of money that we are debating and the total annual budget for Northern Ireland of which they form a part are, relatively speaking, massive. They closely concern the House, not least because they involve a net subvention from public revenues—over and above moneys raised in the Province—of about £1,000 million for 1982–83. Such sums underline, more positively and clearly than in any other possible way, the determination of the Government to meet the pressing economic and social needs of the people of Northern Ireland. Ministers have—as the saying goes—put their money where their mouths are.
Secondly, I am sure that you, Mr. Deputy Speaker, would rule out of order any debate on subjects covered by the Northern Ireland Bill. However, it is relevant to our discussion to point out that during direct rule Parliament 1271 is inevitably restricted in the amount of time that it can make available on the Floor of each House for the discussion of Northern Ireland Appropriation matters. The Government therefore look forward to the time when an elected Northern Ireland Assembly, with its Select Committees shadowing individual Departments, will be able to debate such matters directly in a local context. That is surely the best way for them to be handled.
The Northern Ireland Bill was debated in the House primarily as a constitutional and political matter. I took no part in the debates, but as Minister with responsibilities in the economic field I have given it a warm welcome. It will help, not hinder, the economic outlook for the Province, because it holds out prospects of greater long-term political stability, it will allow for more regular and more public and more local scrutiny, comment and advice by the representatives of the people and, as it brings those same representatives more directly in contact with the realities of dealing with our economic and social difficulties, they will be encouraged to find ways of taking responsibility for their resolution.
I commend the draft order to the House.
§ Mr. Clive Soley (Hammersmith, North)I am grateful to the Minister and his officials for the way in which the information has been presented today. It was helpful and in considerable detail. I am afraid that that is about all that I congratulate the Minister and the Government on. I do not believe that the Government have put their money where their mouth is with the Northern Ireland economy, or that of the United Kingdom.
It is becoming commonplace to say that the crisis in the Northern Ireland economy is desperate. It is becoming increasingly difficult to see how we can get it out of its constant slump without measures that we have never dreamt of before. That is the nature of the crisis. I shall seek to demonstrate this morning why I am not convinced that the Government are making a big enough effort.
The Minister referred to housing starts. I shall not go into that subject in depth. At best what he revealed of the statistics was exciting, but I suspect that what he concealed was vital. The housing starts figures that I looked at showed that the figure of 7,000 in 1977 dropped to 5,000 in 1978–79 and then to about 2,000 in 1980–81. Now the figures are going up again. That is nothing to boast about. I shall look carefully at the Minister's comments in the Official Report. I shall give the figures much more attention before I treat them with the seriousness for which he asked.
The long-term aim for housing should be to remedy the desperate plight of many people in Belfast and other areas of Northern Ireland. To do that, the Shelter plan of about 10,000 buildings per annum is necessary. That is important.
I hope that in the debate we shall hear from the Unionist Members who did not vote last Tuesday on the Finance Bill when we debated restoring benefits to the unemployed. I think that the right hon. Member for Down, South (Mr. Powell) and the hon. Member for Londonderry (Mr. Ross) were the only two members of the Official Unionist Party who voted, and they voted to restore benefits to the unemployed.
§ Rev. Ian Paisley (Antrim, North)What about the hon. Member for Belfast, West (Mr. Fitt)?
§ Mr. SoleyFour or five Members of the Labour Party and some Members of the Social Democratic, Liberal and Conservative Parties did not vote either. The point is that we all know that with another eight votes the Government could have been defeated. Nothing could have been more important than the restoration of those benefits to the 20 per cent. of the work force in Northern Ireland who are unemployed.
We have to answer for our actions. I voted against the Government, and so did two members of the Official Unionist Party. I hope that every other Unionist Member will give us a good explanation of why he was unable to vote. There are often good reasons for not voting. That was such an important issue that it would have to be a good reason to convince me, and a better reason to convince the public in Northern Ireland, particularly those who have suffered unemployment for any period.
§ Mr. James Kilfedder (Down, North)The unemployed in Northern Ireland would pay greater heed to the hon. Gentleman if the Labour Government had done something about reducing unemployment, which grew and grew instead.
§ Mr. SoleyThat is not a fair comment in view of the economic circumstances at the time. It is unreasonable given the present state of the country and the Northern Ireland economy. The hon. Gentleman will have to answer for his actions just as I must answer for mine. There was an opportunity on Tuesday for the benefits for the unemployed to be restored. The hon. Gentleman did not vote, but I did. I am content because I can explain my actions. I am asking the hon. Gentleman and anyone else who thinks that he had a good case for not voting on Tuesday when there was an opportunity to restore benefits to explain their actions to the people of Northern Ireland.
In a statement on 10 March 1982 the Secretary of State for Northern Ireland started by saying that he wanted to deal with the broad thrust of the Government's economic strategy. He then said:
The core of the Chancellor's strategy is to promote a private investment led recovery in the economy. The Budget proposals therefore are designed to reduce industry's costs, to encourage investment and to stimulate employment …Smaller companies will also benefit from the raising of the profits limits for Small Companies Corporation Tax and the VAT registration and deregistration limits. The raising of the limit for Income Tax relief under the Business Start-up Scheme and the increased provision for the Loan Guarantee Scheme are aimed at the stimulation of additional employment opportunities. Because of the greater concentration of small firms in Northern Ireland, these measures should prove of particular benefit to the region.There is no evidence that the Government's broad economic policy has worked either for Northern Ireland or for the rest of the United Kingdom, either in previous years or this year. The index of industrial production in Northern Ireland, seasonally adjusted, shows a dramatic drop after 1979—it goes down by about 13 points. That is a large drop by any standards. The hon. Member for Down, North (Mr. Kilfedder) implied that there were problems in the economy some years ago, but there was never such a drop in industrial production. As is common knowledge, in the past few years we have seen the de-industrialisation of Britain. Unfortunately, Northern Ireland has been in the vanguard. It has paid the highest price by a long way.Unemployment is now over 20 per cent. By any standards, the economy is not recovering. We are bouncing along on the bottom of the recession. Every time 1273 we bounce up a little a Minister tells us that the revival is coming. The Minister of State told us that today. Ministers hope that the little bounce up is a revival. Every fresh report from another area shows that the revival is not real or lasting. Unless we use public expenditure more bravely and sensibly we shall not achieve recovery, least of all in Northern Ireland. The Appropriation order is a lost opportunity to use public expenditure as the engine for economic growth.
The ambivalence of the Government's position is demonstrated by the great enthusiasm with which the Secretary of State and his Ministers greeted the £90 million extra public money that they got earlier this year. They told us about the extra jobs that it would create and the extra houses that would be built. I welcomed it. Any increase would have been beneficial, but we must ask the question that we asked and that was asked in the press at the time. If it is a good thing in Northern Ireland, why is it not a good thing here? Why cannot we have a little more of it? There has to be a limit, but the Government have that limit wrong. It is too low.
The ambivalence is further emphasised when we note from the Minister's comments today the anxiety about the money coming from the EEC. We all want money from the EEC, but what is it if it is not public expenditure? Some of it comes from this country, but it comes from the European taxpayer in one form or another. We are asking for that public money. If public expenditure is such a good thing and if we are going round Europe rattling our collecting box and asking for a little more money here and a little more money there, why are the Government not looking more positively at the public expenditure strategy? I sometimes suspect that, if the Secretary of State for Northern Ireland were in the position of the Chancellor of the Exchequer, he would increase public expenditure. I cannot help getting the feeling that all the Ministers in the Northern Ireland Office recognise the desperate seriousness of the position in Northern Ireland and recognise that it will not be overcome by traditional measures.
§ Mr. Adam ButlerThe Labour Party's policy is that the United Kingdom should withdraw from the EEC. That would mean that we would not receive proportionally more than we invested through the European regional development fund. Northern Ireland would suffer and would not receive the additional £60 million.
§ Mr. SoleyI have always believed that it was a mistake for Britain to join the EEC. There are many reasons for that and it would be wrong to deal with all of them now, but, leaving aside political reasons, Britain joined an organisation that tends to subsidise heavily inefficient agriculture and does not subsidise inefficient industry. We had the wrong economic base to benefit from that organisation. Some of our problems today stem from our joining the EEC. If we withdraw, we must take extra measures to restore the economy. Some of the measures would involve subsidies to British industry here and in Northern Ireland that we could not give under the Treaty of Rome. If we are not to become completely deindustrialised and to suffer increasing unemployment, that is the path down which we must go.
§ Mr. Adam ButlerWill the hon. Gentleman explain to the people of Northern Ireland why he is advocating a 1274 policy that would remove any prospect of additional money for housing and deprive us of the sums that we receive from the social fund and the regional development fund, which are disproportionate to the amount that we invest?
§ Mr. SoleyThe money would be restored by increased Government expenditure. The Minister understands that that is the aim of the alternative economic strategy.
§ Rev. Ian PaisleyDoes the hon. Gentleman agree that it is not true that Britain or Northern Ireland receive more from the EEC kitty than they put in? The Government have admitted, in answer to me in the House, that Northern Ireland is not receiving more. Does he also agree that, of the £50 million already allocated for housing under the special payback scheme for Northern Ireland in January and March this year, not one penny has come to Northern Ireland as additional money?
§ Mr. SoleyThe hon. Gentleman's figures for Northern Ireland are correct.
The Government are worried about public expenditure, but one of the fastest rising areas of public expenditure is unemployment benefit. We are paying people not to work. Every society has unemployed people who must be paid benefit, but it should be a short-term expedient, not a long-term policy aim, unless one is trying to find another way of running society with a different attitude towards work and pay. We have not even begun to think about that. At the moment the Government are apparently content to put other factors in the economic equation ahead of employment. One of those factors is inflation. There is a clear link, but I do not accept that it is balanced sensibly in the present strategy, which costs too much in misery for the unemployed and the low paid.
We should not forget that the Government were elected to cut taxes, yet during the past three years taxation has taken an additional 5 per cent. of the average wage earner's income. As the Secretary of State said when he picked up the broad thrust of the Chancellor's Budget, it was hoped that reduced taxation would lead to greater investment, productivity and income, but it did not work that way. As with so many other Government hopes, whether on law and order, taxation, peace or security, it has failed badly.
It is no secret that in Northern Ireland people have lower incomes and higher expenditure than in other areas. In April, the Confederation of Health Service Employees estimated that about 30,000 health service workers in Northern Ireland earned a basic wage less than the Government's poverty line of £82 a week, which is the amount at which family income supplement becomes payable.
The Government's press statements are revealing. A note to editors appended to a statement by the Secretary of State issued by the Northern Ireland Office on 6 January 1982 stated:
Priority continues to be given to the Industry, Energy, Trade and Employment programmes. The allocation of £200 M. to industrial support and development is evidence of the Government's determination that a shortage of resources will not be a restraining factor in the job creation effort.However, the Northern Ireland economic council converted the 1982–83 figures into 1981–82 constant prices and demonstrated that planned expenditure on industry, energy, trade and employment will decline by 5 per cent. The estimated decline for transport was about 24 per cent. 1275 The Government's priority consists of a 5 per cent. decline. That is the seriousness with which they are treating the crisis in Northern Ireland's economy. It is a desperate comment on the plight of the people there.The overall budget increase was a mere 1 per cent., if we take constant prices as the base. That is a desperately inadequate response. The Minister said that the Government were putting their money where their mouth is. They have not done the necessary analysis to convince themselves, let alone me, the Northern Ireland economic council or the Northern Ireland CBI, of that. The crisis is not being met seriously. I know that the Minister is worried about it. He always looks worried and he has a worrying job, but neither he nor the Government are putting the effort into the problem that it deserves.
The Minister must tell the House more about the decision to start a small engineering firms investment scheme in March 1982 and to close it in May 1982. A press statement of 30 March 1982 was headed
New scheme of assistance to help small engineering firms".The Minister with responsibility for industry is quoted as sayingI am delighted that this scheme, which was first announced in the Chancellor's Budget Statement earlier this month, will apply in Northern Ireland. It will be of particular benefit to small companies in the engineering sector who often find it difficult to raise sufficient capital to invest in new machinery.I would be the first to agree that small companies are important in Northern Ireland. The quote continues:The scheme is well timed. As the recession eases, companies which have not been able to find investment funds over the last few years will quickly have to modernise their equipment and processes; the scheme will be of great assistance to them.The Minister was right to say that the companies must modernise quickly. They would have had only two months in which to modernise, because on 26 May 1982, barely two months later, there was another press statement, but with no quotes from the Minister this time. It is headed "Investment Scheme to Close"and it states:
The Department of Commerce today annouced that the closing date for applications for help under the Small Engineering Finns Investment Scheme, which was introduced some months ago"—that is one of the most curious interpretations of two months that I have heard for a long time—is Friday May 28. The scheme was to remain open until the end of March 1983."—that is one year—but has had to be curtailed because of the large number of applications and the limited amount of cash available.What was the "limited amount of cash?" I am not too sure, but, if I remember correctly what the Minister said a few days ago, it was about £20 million or £30 million. If this is the seriousness with which the Government and the Minister are treating the crisis in Northern Ireland, they are not being serious enough.Either the scheme has failed for some reason which we have not been told, or it was beginning to succeed and the Government did not like the public expenditure implications. That was what the Minister told me during Northern Ireland Question Time. It seems that the scheme was beginning to succed and that the Government did not like the implications. However, unless we take the implications on board and unless we have a bold and resolute policy, we shall not get the Northern Ireland economy moving again. Small firms are a vital link in the economy. What is the truth about the scheme? Why was it stopped after only two months?
§ Mr. William RossThe hon. Gentleman might like to ask the Minister whether any of those who applied for assistance under the scheme represented firms which had previously made investments—in some instances heavy investments—to provide material for De Lorean.
§ Mr. SoleyThe hon. Gentleman may have information that is not in my possession. The problem is that we have very little information. If the hon. Member for Londonderry (Mr. Ross) catches the eye of the Chair, he may be able to enlarge on that issue.
When my right hon. Friend the Member for Mansfield (Mr. Concannon) and I visited Northern Ireland the other week, we went to two DHSS offices. It was clear that the work load on the staff was enormous. That was due partly to the massive increase in unemployment and to the problem of low income in Northern Ireland. There were also special factors such as students joining the register. The staff was expecting another surge in the autumn as a result of school leavers joining the register.
It was clear that the staff was using an outdated system and that it was struggling. In many respects, the offices were well appointed. There was plenty of space for the staff. However, we were left with the impression that there was little space for the public in which to make claims. Presumably the buildings were designed at a time when the economic crisis was far less dramatic than it is now. It is odd to place on the staff of supplementary benefit offices the burden of paying students benefits. Has the Minister a scheme to transfer that burden to the education authorities or, alternatively, to introduce a computerised scheme that would take the burden off the staff and enable claims to be dealt with more quickly? It struck my right hon. Friend and me, in view of the pressure, that what appeared to be a rather old system of organising benefits needed to be examined and reconsidered.
§ Mr. J. Enoch Powell (Down, South)As the hon. Gentleman and his right hon. Friend the Member for Mansfield (Mr. Concannon) were able to pay only a cursory visit, I hope that the hon. Gentleman will be interested and relieved to know that, comparing my experience of the social security offices in my constituency with those over a quarter of a century in a constituency in Great Britain where unemployment was very much lower, I have no hesitation in saying that the efficiency of the service to the public is higher in Northern Ireland than was experienced within my knowledge in a constituency in Great Britain. I think that he should be aware of that. It is one of the outstanding administrative achievements of the Northern Ireland Civil Service.
§ Mr. SoleyI am glad to hear the right hon. Gentleman praising civil servants in Northern Ireland. It is an exciting new development and I look forward to hearing it more often. However, the right hon. Gentleman is comparing the position in South Down with that in his constituency in Great Britain some years ago. I am not saying that the system is necessarily inefficient. However, the burden of work falling on the staff seems to be great. The system that is being used may not be the best one. That does not mean that the staff is grossly inefficient. I am merely asking the Minister to present the House with his views.
There is an important link between education and industry. There was a suggestion that the Hyster plant would be built in Northern Ireland, but it went to the Republic. It appears that the Republic's higher education 1277 system and its link with industry was regarded as being better than that which is available in Northern Ireland. If that is correct, it is a disturbing development. The Northern Ireland education system has been remarkably good in many respects. However, I understand that Hyster was attracted by the link between the higher education system and industry in the Republic, and regarded it as having good potential. It appears that it went to the Republic for that reason. It would be a disastrous mistake if there were any cuts in higher education, especially in the reorganisation that is now being considered. We should encourage the closest possible relationship between industry and education.
§ Mr. Adam ButlerI do not know what the Hyster team found in the Republic, but my understanding is that it went to the Republic because the financial offer was better. I can assure the hon. Gentleman that the Hyster team—I think it consisted of five senior executives—spent a number of days in the Province and visited, among other places, every one of the higher education establishments. It expressed itself as satisfied with what it found and with the quality of the staff that would be available to it. As far as I am aware, it was satisfied with the close relationship between education institutions and industry. I do not believe that that was significant in its decision to go to the Republic.
§ Mr. SoleyI saw the industrial development unit in the new University of Ulster only the other week. There was enthusiasm, quite reasonably, because there had been a number of significant achievements. I am encouraged by what the Minister has said. However, we must do nothing to the education system that will inhibit its links with industry. They must be encouraged at every level, especially with the reorganisation that is about to take place.
I should like to see the Government take up some of the suggestions made by Mr. John Freeman, the Irish regional secretary of the Transport and General Workers Union. We should use extra public expenditure to boost the economy, to give greater energy subsidies and to boost construction work. Industrial development should be co-ordinated between the Republic and Northern Ireland. I appreciate that the political implications of that will send shivers down the spines of the Unionists, but they know my position. We have no problem in understanding each other. Even if they do not accept my constitutional view, I must stress repeatedly that, if the Republic and Northern Ireland choose to have competitive economies, both will continue to do badly economically.
It is impossible for 1.5 million people in the North and 3.5 million in the South to make sense of an economic policy in an island the size of Ireland on a competitive basis. There are many areas in which co-ordination and cooperation are needed if we are not to have the sort of nonsense that has been seen in, for example, the Hyster deal, when each side attempted to outbid the other.
It is significant that possibly the chairman, or certainly a member of the industrial development authority in the Republic, said that he and his board received no pleasure from depriving Northern Ireland of the Hyster plant, but that they had to do their best to get it as well.
Many areas of the two economies should and can be complementary, and there is a desperate urgency for the 1278 two boards to have a link enabling them to co-operate and not just to compete. Such competition will lead only to continuing economic decline.
§ Mr. KilfedderIt is not just a question of the Republic and Northern Ireland outbidding each other for business. I understand that many American and other business men who go to the Irish Republic are warned by the authorities there not to go to Northern Ireland because of terrorism and the dangers to their business men and businesses. I further understand that the Irish Republic embassy in the United States of America works overtime in telling American business men to invest not in Northern Ireland, but in the Republic.
§ Mr. SoleyThe hon. Gentleman makes my point. He is emphasising yet again the importance of the ability to talk through a co-ordinating committee. It need not be a joint board, if members of the Unionist Party do not like that, but a committee of the two boards. It is nonsense to compete in such a desperate way. If the hon. Gentleman is right, that shows the degree of desperation that exists to obtain orders. We cannot pretend that the two economies can be completely separate and in competition with each other while at the same time being beneficial to the people of Ireland, whether they live in the Republic or in the North.
The Labour Party is suggesting an alternative economic strategy which rejects attempts to control the money supply and reduce public sector borrowing as a simple economic theory. To go on like this will ultimately do to the rest of Britain what we are doing to Northern Ireland. As I have said, Northern Ireland has seen a desperate crisis in the past few years.
We must reflate the economy through public expenditure on capital projects. Obviously, there must be limits, but there is no economic sense in paying people not to work for a long period. That is the nonsensical situation in which we find ourselves. There is now a long-term policy of unemployment which, however the Government try to dress it up, is costing us dear, in both economic and social terms. We cannot continue in that way.
I am sad that the Government have lost yet another opportunity to do something more effective to intervene in the Northern Ireland economy. If we do not take more serious action, I fear that the crisis will only get worse.
§ Rev. Ian Paisley (Antrim, North)I do not want to make any further comments on the remarks of the hon. Member for Hammersmith, North (Mr. Soley), who led for the Opposition, about what happened on an earlier debate. To be fair, he should not say that only Unionists were absent, because the hon. Member for Belfast, West (Mr. Fitt) was also absent. As I have said, it is unfair to say that that shows that people are not interested in solving the problem of unemployment in Northern Ireland. Such remarks do not help those hon. Members who live with the problems of Northern Ireland and who are busily engaged in seeking to bring jobs to Northern Ireland.
§ Mr. SoleyI did not say that. All I said was that the House and the people of Northern Ireland should have an explanation. There may be a good reason why the hon. Gentleman was not present.
§ Rev. Ian PaisleyIf the hon. Gentleman knew anything about Northern Ireland he would know that 12 1279 and 13 July are days with a difference. If the hon. Gentleman had visited the Province with his friends on those two days he might have been enlightened to his advantage in the representations that he makes at the Dispatch Box today. I hope that the promise given by the Government on that occasion to which the hon. Gentleman referred will be implemented. If all the hon. Members for Northern Ireland, including the hon. Member for Belfast, West, had been present, that would not have altered the vote.
§ Mr. J. Enoch PowellDoes the hon. Gentleman agree that a comment such as that made by the hon. Member for Hammersmith, North (Mr. Soley) comes ill from a party that does not seek to represent the Northern Ireland electorate in the proper democratic manner? When that party seeks to do so, then, and only then, can it be listened to on the matter of attendance or non-attendance of hon. Members from Northern Ireland at debates in the House.
§ Rev. Ian PaisleyI should certainly welcome members of the British Labour Party standing as candidates for the Assembly. They have the opportunity to give their blessing to it. The hon. Member for Hammersmith, North could stand himself. I advise him to come to North Antrim, and I am sure that the right hon. Member for Down, South (Mr. Powell) would invite him to South Down as well. He would receive a hearty welcome, but not a good vote, and would probably lose £150, which would be a salutary experience. However, I do not want to deal with such matters today as there are other important matters to be debated.
I was pleased to hear the Minister praise the Common Market and its assistance for Northern Ireland, but I am amazed that he has failed to suggest that the less-favoured 1280 areas should receive support from the Common Market. I press the Minister on this matter. This is a running sore among farmers in Northern Ireland, as I am sure he is aware because the matter has been raised over and over again.
May we be told today what will happen? Will the Government now proceed with an application to the Common Market for assistance for the less-favoured areas of Northern Ireland? Are the Government prepared to put up their part of the money so that those less-favoured areas can be helped? I am sure that the Minister is well aware that this important matter will effectively assist the farming community in Northern Ireland.
Will the Minister deal at length with this problem and ensure, first, that the Common Market will receive an application for assistance for the less-favoured areas in Northern Ireland and, secondly, that the Government will put up our part of the money? It has been made clear at the Dispatch Box that the Government are not yet committed to putting forward an application to extend the less-favoured areas. I trust that the Minister will say something about that.
Perhaps the Minister can explain the announcements in January and March about the Common Market special repayments schemes and why none of the £50 million allocated to housing in Northern Ireland is additional money for the Housing Executive. Some of the trouble with the German Government stems from that. My hon. Friend the Member for Belfast, East (Mr. Robinson) and I met the German ambassador in London—
§ It being Eleven o'clock, MR. SPEAKER interrupted the proceedings, pursuant to Standing Order No. 5 (Friday sittings).