HC Deb 24 March 1936 vol 310 cc1200-6

Motion made, and Question proposed, "That this House do now adjourn."—[Captain Margesson.]

11.6 p.m.

Mr. GARRO-JONES

I wish to draw attention to a principle of administration in the Ministry of Labour which I believe to be inequitable in its general application, but with which I am principally concerned in its application to the problem in general and to the constituency which I have the honour to represent in particular. I refer to the inclusion of certain areas as depressed areas for the purposes of securing preference in the allocation of Government contracts. Under the Special Areas (Development and Improvement) Act, 1934, certain areas are given decided advantages by the State. I should not be in order in dealing with suggestions for the amendment of that Act, but the Minister, in the exercise of his administrative functions, has brought into operation another list of scheduled areas which will receive a preference, other things being equal, in the allocation of Government contracts. I wish, first of all, to submit that the principle of scheduling depressed areas is unreliable. We all know that areas which are depressed in one period become prosperous in the next. It is a very short time ago, for example, that the cotton industry, the coal industry, and the shipping industry were at the peak of prosperity. A few years pass, and they become in the depths of depression. Similarly, a very short time ago the engineering and iron and steel industries were in a state of serious depression, and now they are restored to comparative prosperity. I therefore suggest that it is wrong to lay down in a statutory schedule, and also in an administrative schedule, areas which are to receive certain privileges by the State.

The Minister has included certain areas which will receive preference in the allocation of Government contracts, and he has laid down this criterion for those areas, that, provided that 25 per cent. or more of the men over IS are unemployed, that area shall receive preference. I contend that that is a very unsound criterion to set up. It leaves wholly out of account the fact that in that particular area there may be an enormous number of women unemployed or juveniles unemployed, or there may be a considerably larger amount expended in the distribution of Poor Law relief to the able-bodied poor. That is to pick on merely one indication of depression and ignore all the others, and say that any town with this one criterion of depression shall receive preference in the allocation of Government contracts while other towns on its very border, which may be far more depressed than the town scheduled, are excluded from that preference.

I expect the Minister will say we cannot give any privilege to any area without giving grounds of discontent or complaint in the adjoining areas. He may say that it is quite impossible to draw up a schedule which satisfies everyone and that it is difficult to draw up a schedule which completely satisfies anyone, but his contention will be that a schedule must be drawn. I contend that it was inadvisable to draw up a schedule and that, if he must have a schedule, he should not take merely one indication of depression and allow that to be his guide in deciding whether they shall receive preference in the allocation of Government contracts or not. What I wanted to ask him first was, whether he would abolish altogether his administrative schedule of the depressed areas and allow Government contracts to be allocated with regard to all the circumstances of any given area? If he declines to do that and says that he must have a schedule of some kind, then I ask him to make that schedule more elastic in order to bring into it districts which, although not having, perhaps, as great a percentage of unemployed men as the preferred area, are yet, judged by all other relevant criteria, just as distressed as those included in the schedule.

I would ask the hon. and gallant Gentleman to be good enough not to give me the kind of answer which he gave to a Parliamentary question. I asked him a question which I couched in very clear terms and he thought fit to answer it merely by recapitulating what he was doing. My question had reference to what he was doing and asked him whether he could change it. It was unnecessary to repeat what he had already stated and I hope he will be able to do something to meet me in behalf of the constituency I represent.

11.13 p.m.

Mr. JOHNSTON

Before the Minister replies may I add one word and one point to that which is made by my right hon. Friend the Member for North Aberdeen (Mr. Garro-Jones)? I would ask the Minister to give the House some information not only as to his ground for selecting areas as distressed, but as to how he delimits those areas. I have supplied him with particulars of one exceedingly depressed area, a small village that is tremendously depressed, and has been so for many years, but because this village is centred in the midst of an agricultural district it cannot be, and has not been, scheduled as distressed. Yet this village has no work whatever. It has no employment of any kind whatsoever, and it feels itself very seriously handicapped in relation to other towns where there is in fact less unemployment, and yet these other towns have preference for employment when given. I would ask the Minister, in support of the plea put forward by my hon. Friend the Member for North Aberdeen, that if we must have distressed areas—there are disadvantages as well as advantages in having them—we should have some clear and well understood explanation of how the Government intend to fix the limits of those areas as well as the conditions upon which the area are formed.

11.15 p.m.

Mr. ELLIS SMITH

I want to associate myself with the issue raised by my hon. Friend and to give two or three illustrations. The first is in regard to certain parts of Lancashire which are just as depressed as any other parts of the country. Because it is confined to a small area, there is not the same notice taken of the position as there is in a bigger area. The same thing applies to North Staffordshire. There is one place, Kidsgrove, where the percentage of unemployment is as great as, if not greater than, that in any other part of the country. Because it has not been scheduled it does not come within the category of those receiving preference when certain orders are being given out. A well known firm quoted for orders that were being given for locomotives, but because it did not come within the area specified, it was not in the position to be dealt with on the same basis as other firms in scheduled areas. I hope the Minister will reconsider the policy with regard to this question.

11.17 p.m.

The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Lieut.-Colonel Muirhead)

The hon. Member for North Aberdeen (Mr. Garro-Jones) referred first to the Special Areas. The Special Areas are, of course, laid down by Act of Parliament, but that is not so with the scheduled depressed areas. Those areas are left to the discretion of the Minister. The schedule was originally instituted in connection with the industrial transference scheme. At the time the standard which was taken—there was no statutory basis for it—was for the most part that 40 per cent. of the insured males of 18 years and over should be employed in the coal, iron and steel or ship-building industries and that there should be 15 per cent. of them unemployed, over the period of the last 12 months. There were certain additions made to the original list, including certain parts of the depressed cotton areas of Lancashire. As the hon. Member was so particular in his enjoinment on me not to tell him anything that is actually happening I will not tell the House again the qualifications which are necessary for inclusion in the existing list. I think, however, that the hon. Member overlooks one point. He says quite rightly that an area may be very depressed at one time and after a period, perhaps not a very long period, may fall upon a period of prosperity. That is true, and under the procedure that we adopt we make allowance for that fact. The present list, for instance, is the subject of revision by us at periods of not less than six months. That, I think, is quite a reasonable period for revision. One wants to insure that the criteria which qualify an area I to be treated as depressed will allow of some degree of stability. That is why we take the average for the past 12 months. At the same time we have to make allowance for industries which pass from prosperity to depression or from depression to prosperity.

That Schedule is not, then, something which remains in perpetuity and incapable of change or adaptation. We can and intend to change it and adapt it in accordance with charges in the industrial circumstances. The hon. Member then went on to ask why we applied this particular test alone, and proceeded, which is always helpful, to make some remarks for me. If in this House we were afraid of boundaries we should never do anything because there are always some people or places which are just outside the boundaries. This would be the end of legislation in this House. Whatever standards we fix there will always be people or areas which are just inside the one or outside the other. The hon. Member suggested as a standard the number of people on Poor Law relief. One disadvantage of that would be that a certain number of those on Poor Law relief are aged people, and some are outside the industrial field. Also, one has to remember that for the most part those on Poor Law relief are registered at the exchanges, and are therefore already included in the total unemployment figures, so perhaps the difference between the two is not so great as the hon. Member suggests. I think it would be difficult to find a more suitable test than the rate of unemployment in a district.

Mr. GARRO-JONES

If the hon. and gallant Gentleman is so satisfied that this is a satisfactory and infallible test, why did he make an exception to that test in the cotton areas on account of the number of women workers there? Should he not take into account in other areas the percentage of juvenile and other workers?

Lieut.-Colonel MUIRHEAD

We took into consideration the percentage of women in the cotton areas in Lancashire because in our opinion there are exceptional factors in connection with female employment in those areas. I think opinion generally would be inclined to agree that there are exceptional factors in that case which do not for the most part exist in other areas. The right hon. Member for West Stirling (Mr. Johnston) wanted to know on what principles we had delimited these areas. The delimitation is within the discretion of the Minister; as I have said, there is no statutory basis; but it is clear that there must be some limit to the smallness of the areas over which one can apply this test or qualification. I should like to set hon. Members' minds partially, perhaps, at rest by explaining the particular nature of the preference which is given to the scheduled depressed areas. The consideration is that, other things being equal, the Government preference for contracts shall be given in these scheduled depressed areas. I stress particularly the words "other things being equal." That may meet the point of the hon. Member.

The phrase is intended to be interpreted in the full sense. It includes technical considerations and all very high or particular specialisation. Where you get all other things equal, the preference of Government contracts will be given to the scheduled depressed areas. Some hon. Members seem to have the impression that the preference is almost tantamount to excluding the rest of the country from any benefit that Government contracts may provide. That is not so. Before this preference is given to the firms in the scheduled depressed areas, all the other things relating to the contract must be equal. There need be no fear on the part of hon. Members that this sympathy for the depressed areas means that the scheduled depressed area forms a close corporation with a complete monopoly of tendering for and being given Government contracts. The hon. Member asks me now—and I am sorry if I misunderstood his original question—as to whether in point of fact we intend to alter the qualification which we have now adopted. He also expresses the hope that all these questions of special preferences for particular areas might be done away with, so that you might have a sort of Free Trade in preferences. We consider that the general principle of preferences for certain depressed areas to be sound, and at the moment—although we are always willing to benefit by experience—we consider the complete qualification and standard employed to be sound also.

11.28 p.m.

Mr. DINGLE FOOT

I hope the hon. and gallant Gentleman will reconsider in future the question of taking into account the Poor Law figures. He said that they represented for a large part old people who were riot available for industry—

Lieut.-Colonel MUIRHEAD

I did not say for a large part, but I said that at all events they were included.

Mr. FOOT

I quite agree, but where in a certain area you have, over the past three or four years, a constant and substantial increase in the Poor Law figures, which cannot be accounted for by the old people who are not available for industry, I submit that that ought to be taken into account. It is perfectly true, also, that the Poor Law relief figures include to a certain extent those who register at the exchanges, but, although that may be so, and although the Poor Law figures may not give much assistance in showing the extent of unemployment, at any rate they help to show, in any particular area, the kind of unemployment that exists, and to a certain extent the duration of unemployment among the people concerned. For these reasons I hope that in future the Poor Law figures will be taken into account in making up this schedule.

It being Half-past Eleven of the Clock, Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.