That it is expedient to continue the Special Areas (Development and Improvement) Act, 1934, until the thirty-first day of March, nineteen hundred and thirty-nine, and to make further statutory provision for—
Provided that such financial assistance shall only be given either by means of subscription to the share capital of site-companies incorporated for the purpose of providing factories in such areas with a view to inducing persons to establish industrial undertakings therein, or by means of loans to such companies, and the assistance provided to any such company shall not exceed an amount equal to one-third of its paid up share capital exclusive of any share capital held by the Treasury;
(d) enabling the Treasury to provide financial assistance, not exceeding in the aggregate two million pounds, by way of loan to persons carrying on industrial undertakings which are hereafter established in any special area or, in the case of industrial undertakings occupying factories provided by site-companies, in any such area as is mentioned in the last foregoing paragraph of this Resolution;
(e) the payment of moneys provided by Parliament of any sums required for the purposes aforesaid; and
(f) supplementary and consequential matters.
In this Resolution the following expressions have the meanings hereby assigned to them—
'Commissioners' means the Commissioners appointed under the Special Areas (Development and Improvement) Act, 1934, and 'special areas' means the areas specified in the First Schedule to that Act;
'Site-company' means a body corporate established for the purpose specified in paragraph (c) of this Resolution, being a body which does not trade for profit or a body whereof the constitution forbids the payment of any interest or dividend at a rate exceeding such rate as may be for the time being prescribed by the Treasury.
§ Resolution read a Second time.
§ Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."
§ 11.7 a.m.
§ Mr. John
I rise to oppose the Resolution. We have had many discussions on it, but evidently the speeches on this side have made no impression on the Government; at least, there have been no changes in the proposals which they brought before the House. We do not oppose this Resolution for what it contains, but because it is such a puny effort on the part of the Government to deal with the problem of the Special Areas. The proposals are totally inadequate, and they lack a comprehensive and constructive policy to deal with the great problem of the Special Areas, one of the greatest problems which the House and the country have had to face for a number of years. Unless better proposals than those contained in the White Paper are put forward, we shall have to face this problem for many years to come. The White Paper is practically a recital of what the Government have done under existing powers. Indeed, it is a futile attempt of the Government to magnify what has been done in the Special Areas since the Special Areas Act was introduced in December, 1934.
The local authorities in those areas have no cause to be jubilant over the Financial Resolution. Their expectations have not been realised. The Commissioner for England and Wales made a recommendation that the Special Areas must be relieved of all excessive burdens, but nothing is proposed in the Resolution to carry it out. There is a number of excessive burdens that the local authorities 2465 in the Special Areas have to bear. A number of the areas in south Wales which are the hardest hit had, during War-time, to borrow in order to construct works. There was the Taf Fechan Water Board, for instance. For the next 50 years or so the local authorities will have to bear an annual rate liability of from 6s. to 7s. in the £. This Board was formed and Parliamentary sanction was given in order to carry on the water and sewerage schemes in anticipation at that time of an expansion of trade and an increase of population. As a result of the depression trade did not expand, and the mining industry was hit very severely, while, as the result of transference, a great deal of the population has left this area. The position in those areas now is that the local authorities have to bear a burden which means a rate of 6s. to 7s. in the £ Nothing is mentioned in the White Paper about easing that excessive burden.
Then there is the question of the Goschen loans, which has been frequently discussed in this House. Those loans were contracted by the old boards of guardians prior to 1929, and were transferred from the old boards to the county councils. A number of the local authorities had paid their loan before the transfer, but some of them are having to pay twice. What is the effect of the Goschen loans upon the county authorities in the depressed areas? The figures have been given before, but they are so impressive that they need to be repeated in order to show the Government the need for easing the local authorities of this burden. The Monmouth County Council has an annual liability under the Goschen loans of £40,525, which is equal to a rate liability of 10.36d. Glamorgan County Council has a liability of £38,313, or a rate liability of 3.45d. Merthyr has a liability of £7,324, or a rate liability of 8.2d. Sheffield has a liability of £60,809, or a rate liability of 5.05d. The total debt outstanding is in the region of £2,000,000 on the Goschen loans, and the annual payments amount to £340,844.
That is a tremendous burden for those local authorities to carry. Taking the Goschen loan, and the cost of water and sewerage scheme which had to be carried out at a time when costs were high, during the War period, there is a burden on the local authorities amounting to about 7s. 6d. in the £. In the 2466 absence of an agreement among local authorities in the country to share this burden, the Government have left the Special Areas to carry it themselves, utterly regardless of the recommendation of the Commissioner that relief should be given to the Special Areas. In paragraph 14 of the White Paper it is stated:In his Third Report the Commissioner for England and Wales proposed that 'the excess burden of public assistance on local authorities in the Special Areas should be reduced by some such means as the equalising of the public assistance rate throughout the country.' When this recommendation was made the Commissioner was of course not aware of the relief which would be afforded to rates in the Special Areas by the Local Government (Financial Provisions) Bills now before Parliament.It is clear from that paragraph that the Government do not intend to do anything to ease the burdens of the local authorities beyond what has already been done through the block grant. That the Government have given a certain amount of benefit to the local authorities under the block grant no one will deny. The county of Glamorgan, which has a rate of 20s. 11d. in the £, gets a benefit equal to 24.5d. in the £. Durham, which has a rate of 18s. in the £ has had an easement of Is. 8.8d. Blackpool, with a rate of 7s. 6d. in the £, has benefited to the extent of 3.1d. I contend that if the Special Areas had been taken into consideration separately and dealt with upon their merits the Government would have granted them a greater measure of benefit than is represented by a relief of 2s. to an area which has a rate of over 20S. in the £. To say that the Commissioner did not know that the Government were increasing the amount of the block grant is a futile excuse, because under the block grant revision the Government are only fulfilling their obligations under the Act of 1929.
Take the relief of 2s. in the pound in the case of Glamorganshire. The county will not receive the full advantage of that benefit. The argument in the White Paper is that these benefits are being given in order to provide an opportunity for the local authorities to expand and improve their health services. The effect of the changes in the rating of railways reduces the benefit of the 2s., and Bills which we have been passing through this House lately have placed further obligations on the local authorities, for 2467 instance, the Midwives Act will increase their financial responsibilities. Further, the cost of materials and of food for hospitals and other institutions is rising. Therefore, the actual benefit from the new money in the block grants will really be very small. The local authorities have no cause to be jubilant over the magnitude of the benefits they have received. Seven or eight pages of the White Paper are occupied with showing what the Government have done under existing methods, and it also refers to their proposals for the future, mainly with the object of providing work for the unemployed in those areas.
I should like to direct the attention of the House to one particular phase of this matter which has been neglected right along the line. In paragraph 21 it is stated that they are to give a grant for field drainage, but the grant is to be a very small one. Why do not the Government deal with the drainage problem on comprehensive lines? We know how the country has suffered from floods in the last few days, and a large portion of the country is constantly like a lake. Why do not the Government introduce a comprehensive scheme of land drainage to bring back into cultivation large portions of land? The Commissioners in their reports have emphasised the need for the Government to put men in the industrial areas back into work, and the desirability of reclaiming land which has been lost by coastal erosion and by neglect of proper drainage is not only recognised by Members of this House but also by the Commissioners.
The other day there was a survey of the position in Wales. Professor Staple-don, of Aberystwyth, in his survey of agricultural and waste lands in Wales, shows that there are vast barren areas there which could be made fertile, that there are thousands of acres in the hills which could be converted into pasture or clothed with forests. That is a survey by a man whom everybody recognises as an authority, but the fact that the Government are to make a grant only for field drainage shows clearly that they have no intention of dealing with the problem of drainage in general.
In the industrial areas, the Government are waiting for the old people to die and are transferring the young people. There 2468 are plenty of poor lands and waste areas which ought to be brought back into cultivation. The White Paper showed that experiments had been and are being made with regard to land settlement, but what a slow process it is. In the last two, years only 16 people have been settled on the land in South Wales. The White Paper gives the figure of 2,000 for England and Wales, but every year more than 1, 000 people leave the land, so that putting 2,000 on the land really comes down to the fact that only 1000 people have been put on the land through land settlement schemes. It shows very little more than the folly of the present policy of the Government in dealing with this problem.
Everybody admits that agricultural land is going out of cultivation. Between 1924 and 1932, in England and Wales, 700,000 acres went out of cultivation and the number of farm workers was reduced from 928,925 to 809,100. That is a reduction of about 12 per cent. It was stated, in reply to a recent question by the hon. Member for Pontypool (Mr. A. Jenkins), that the number of farm workers was reduced from 741,696 in June, 1930, to 640,576 in June, 1936. The White Paper shows that a number of people have been placed upon small agricultural holdings.—