SCOTTISH AFFAIRS

HC Deb 15 July 1953 vol 517 cc2069-186

3.53 p.m.

Mr. Douglas Johnston (Paisley)

In the closing sentences of the speech of the Parliamentary Secretary to the Ministry of Labour last night—a speech on which we must all congratulate him—he said that he did not end in a spirit of gloom. We on this side of the Committee, and I believe on the other side also, did not start this debate in a spirit of gloom. We started it, first, in a spirit of impatience, and secondly, of anxiety. Our impatience is with Her Majesty's Government, and nothing the Secretary of State for Scotland said yesterday in any way allayed that impatience.

My impression of the Secretary of State's speech was that it was an admirable historical record of what had happened in Scotland in 1952. It contained one or two minor points about the future, particularly about the exploitation of peat in Caithness—which was started by my right hon. Friend the Member for East Stirlingshire (Mr. Woodburn)—and the re-allocation of the grants for Highland roads, but apart from that it was nothing but an historical resumé.

We do not expect the Scottish Office to be merely an historical records office. We expect the Secretary of State to be a spur, and not a filing cabinet. We got the impression—and I say this with regret, because I have great personal affection for the Secretary of State and a great deal of admiration for him—that he was not showing that drive and enthusiasm which are so essential in the Scottish Office if Scotland is to prosper.

We are very glad to see the President of the Board of Trade here today, because throughout our debate yesterday I felt that we were starting at the wrong end of the problem. Yesterday, we dealt with the problem of how to produce. That is not the problem of any modern industrial society. The problem is not to manufacture; it is to sell, and the problem of selling is particularly one for the President of the Board of Trade. It is a problem which all industrial societies have to face, and always have had to face, and it is made more difficult nowadays by the fact that we are not the only industrial society. Germany and Japan are coming back into the industrial field, and many countries are setting up their own industries and protecting them.

The fundamental problem arises because the world balance is upset. The industrial countries are becoming relatively richer than the non-industrial countries. I have no statistics to support this statement, but it is probably true that, for example, when the East India Company started trading with the Indies there was very little difference between the wealth of India and the wealth of the countries with which India traded. I imagine that the Indian peasant was relatively little worse off than the peasants of Europe.

That has all changed. The result is that in vast areas of the world there is not now the buying capacity which the trading nations of the world require. If we are to increase our selling we have to do two things. We have to get back to our 19th century habits of investing abroad and of granting very long credits. I realise that that is not going to be easy. It means that this generation will have to be content with bread, in order that the next generation may have bread and a hope of some butter and jam with it. That is a large problem, with which it is not suitable to deal today in more than general terms. It is a Cabinet problem, and not one for the President of the Board of Trade alone. But the President has various responsibilities for trade, both at home and overseas, and he can do much to promote that overseas trade.

I should particularly like to ask him what is happening with the overseas guarantees. The Committee will remember that in 1939 we passed a further amending Act which greatly extended the power of the President of the Board of Trade to guarantee credits to those who were trading abroad. I should like him to give some particulars of what is happening to those credits, and how far he is making them avaliable to industrialists in Scotland.

I have the impression—it is nothing more than an impression, but I think it is well-founded—that, while the existence of these industrial export guarantees are well known to the larger industrialists, they are hardly known at all to the smaller industrialists in Scotland. Despite what the hon. and gallant Member for Perth and East Perthshire (Colonel Gomme-Duncan) said yesterday, Scotland is still a country of small industrialists. There are great firms, like Distillers and, in my own constituency, J. & P. Coats, which do not require to have these facilities advertised to them, but there are many smaller firms which do.

What does the President's Department do to advertise the existence of these facilities to smaller industrialists in Scotland? It is easy enough for the large firms to find openings for trade abroad. It is worth their while to send special representatives abroad and, in many cases, it is worth their while to maintain those representatives abroad, but what is done to help the small man whose entire trade may be a few hundred thousands a yead or even a few thousands a year and who has no knowledge of what the markets are abroad or of the needs abroad? What does the right hon. Gentleman's Department do to help that man, first of all in telling him what those abroad require and, secondly, in bringing to his notice opportunities of trade abroad?

I have an impression—again, it is no more than an impression, for I am not an industrialist—that there are many opportunities of trade abroad which the small firms would seize if they knew of their existence. Very many small firms have by various means got markets abroad which they maintain and supply and on which they do very well, greatly contributing to our balance of payments, but I have a feeling that there are many more opportunities which would be taken, certainly for the small firms, if only the small firms knew of their existence.

It is one thing to have an opportunity but it is another thing to take it, and my impression is that while the big industrialists in Scotland—I have mentioned two but there are many others—are well enough provided with capital, the smaller industrialist is very short of capital. I do not blame the Government very much for this, although I believe their credit restriction policy will need reconsideration. I certainly think their policy on the Bank rate requires very rapid reconsideration indeed, for two reasons. First, it puts up the price of the commodity. The only commodity the price of which the Government actively and absolutely control is money. Increasing the interest rate puts costs up and makes it more difficult to compete abroad.

Secondly, it makes it more difficult to get credit. I refer not only to the retrictions imposed by the Government and the banks on credit but to the fact that even if a firm has a project for which Government permission has been obtained, or a project which would get permission from the Government or the banks, the present policy makes it more difficult to cover the necessary credit with adequate security because the increase in the Bank rate has led to a depreciation of securities. I have no doubt that the Chancellor of the Exchequer is thinking of this problem. It is time to think of easing the interest rates for those two reasons.

I do not blame the credit difficulties on to the Scottish banks which, on the whole, are very good indeed about credit. They are also pretty good, and much better than the English banks, in granting credit to the person rather than to the security of the person. In fact, it is sometimes surprising what credit is granted by Scottish banks on the man rather than on his assets.

There is one particular difficulty about credit which I should like the Secretary of State to consider. In England a company can obtain credit by giving a floating charge over its assets. That is not possible in Scotland. Scottish law does not recognise a floating charge over assets. As a result, a Scottish company or firm may have assets on which it can obtain no loan because it cannot give the necessary security. This position has existed for hundreds of years, but in present circumstances it is well worth investigation, and I suggest to the Secretary of State that, in conjunction with the Lord Advocate, he should remit for consideration the question of the advisability of an amendment to the law so that we may have in Scotland something equivalent to the floating charge. I know there is something to be said against it, but the question is well worth examining.

Reverting to the creation of opportunities and the inability to take them, many of the small firms and companies in Scotland, and indeed some of the large firms, have factory buildings totally inadequate at the moment and quite unsuitable for expansion. I am very sorry to hear that the Government intend to maintain their non-implementation of—or, if that is thought to be putting it too high, their unwillingness to implement—Section 3 of the Distribution of Industry Act under which it was possible for local authorities and the Government to build factories. I think the Government should face this: it is very unlikely that new factory building will be done by small private enterprise firms in the foreseeable future. The big company may do it but the small company has not the resources or, if it has, on the whole is unwilling to risk them.

I realise that this is contrary to general Government policy and to the whole Conservative idea, but the Government must make up their mind that they will have to invest in industry. I know that they give loans and sometimes grants to industry, but I am opposed to such a policy and would much rather see the Government invest directly in industry, taking the equity rather than the debenture. There is nothing new in that. The founder of the modern Conservatives had such an adventure with the Suez Canal shares, and I understand that much of the Grangemouth experiment, which occupies so much of the Report on Scotland, 1952, is largely Anglo-Iranian. That is direct Government investment in industry, and it must continue, because the risk capital is not now available. Certainly it is not available for the smaller industries.

The reason it is not available for the smaller industries, in my view, arises from the psychology of the Scot. I do not think it is always realised how much the investment practice of this country has changed in the last 50 or 60 years. At the end of the Victorian age it was fairly certain that if a man had money to invest he invested it in a local enterprise. That was partly because the wide facilities of the Stock Exchange, as we know them, existed but were not so well publicised as they are now.

The second reason was that investment was possible for the small man. The majority of businesses in this country started rather like Lord Nuffield's business—with a bicycle shop or something of the sort. That is all changed now. I do not think that there is going to be much of that type of investment. The result was that a man was able to invest his money in a small business that grew and grew until ultimately he had a large business which was floated off into a public company.

As a result of the increase of investment facilities and of the native caution of my countrymen, we have now a very great reluctance in Scotland to invest risk capital in local enterprise because the local enterprise is too local. In my profession I see from time to time inventories of estates of anything from, perhaps, £2,000 to a substantially greater sum, and the astonishing thing—at least, astonishing to me—is that one finds that in most estates the investment is first in Government securities, second in banks, third in insurance company shares, and fourth— and this is the more modern one—in investment trust companies. One rarely finds the money invested in a local enterprise, unless the investor happens to have control of the local enterprise; but there is no what I would call equity investment in local enterprise, or very little.

The reason for that, as I said, is caution, the idea that one spreads one's risk as much as possible, and, as a result of that, what is happening now is that more and more local savings are going first into insurance premiums and second into companies which have a wide basis for their activities, the shares of which are readily realisable. There are plenty of people who invest in Distillers and in J. & P. Coats, but we want plenty of people to invest in x y companies.

I suggest that the way to achieve that is for the Government to invest in local companies. If the Government will not do that, and frankly I am not at all hopeful that I shall persuade them to do it, I suggest that it is high time that local people in the localities in Scotland should take it upon themselves to float investment companies, not with the idea of the present Investment Company of simply buying stock in established concerns, but of investing in equities in local concerns.

There are, of course, difficulties, but I think that those difficulties can be overcome, and the first way to overcome them is, of course, for authoritative opinion to declare it to be impossible, because we in Scotland have never liked authority very much, and generally if we are told that this is an authoritative opinion we kick against it. If we are told a thing is impossible, that is the best way to encourage us to do it. I do not think there should be any difficulty in getting a vast body of informed opinion to condemn my idea.

I think it is quite certain, indeed, that the right hon. and noble Lord who used to sit in the House for Bournemouth, East and Christchurch, and sat on the Government Front Bench, will readily condemn it in his financial papers. I think he has sufficient regard for Scotland to do that for us, and I am hopeful that the President of the Board of Trade, or, if not, another of the Ministers, may condemn the idea, for, of course, if we get Government condemnation of an idea, that immediately arouses such enthusiasm in Scotland for it that it is bound to be a success.

Sir William Darling (Edinburgh, South)

Do I apprehend that the hon. and learned Gentleman suggests that there should be investment by the Government in local industry? Then how is that investment to be brought about? Does he propose to raise the Income Tax —my Income Tax—to invest in local industries?

Mr. Johnston

If necessary, yes. But is it necessary? I doubt if it is. It would be first of all on such a scale that it would mean very little, and second it would mean such a vast surge of activity in Scotland, in the United Kingdom, that it would result in very much greater taxable capacity. We did it for Anglo-Iranian. I do not know what the Government investment is, but it is possibly tremendous in Anglo-Iranian. That money originated, of course, in taxation, but it must bring in vast sums which must result, presumably, in a reduction of taxation at the end of the day. Surely, that is agreed?

I am asking the Government to expend a little now in order to get a return from expanding business in the future. Surely it would be much better to adopt such an idea as this rather than to allow industry to stagnate? If industry stagnates we inevitably have a rise in the rates of Income Tax. If we have a stagnating industry we lose income to tax. What I want to do is to increase the income, with results on taxation.

Mr. J. Grimond (Orkney and Shetland)

I certainly very much agree with the hon. and learned Gentleman's plea that people should raise money and reinvest it in Scotland, but does he not want the Government to throw difficulties in the way? Did not the Government of his own party throw difficulties in the way of investment? Is the hon. and learned Gentleman in favour of allowing investors to keep their rewards?

Mr. Johnston

I am in favour of new capital. I started by saying that I thought that the Government would now or in the very near future have to reconsider their whole attitude towards the Bank rate and capital investment. I think they will. They cannot open the flood gates immediately, and cannot give a general authority; they will have to look at every point; but I think that these projects, particularly these comparatively small projects, are worth looking at.

The next thing to make this a success is to make it local. I thought that the idea of the hon. Member for Edinburgh, South (Sir W. Darling), that we should float a company to build the Forth Bridge, was admirable. I do not know anything about the economics of it, but I think it would make a magnificent Scottish gesture, and I think gestures are very significant and worth while. I think the Coronation and everything we have done in the last two months has been worth while as a boost. If we in Scotland saw this road bridge up over the Forth it would give us a feeling that something really big and worth while was happening in Scotland.

Lieut.-Colonel Walter Elliot (Glasgow, Kelvingrove)

These projects are most interesting, but do I understand the hon. and learned Gentleman to contend that, public enterprise having failed, private enterprise should take its place?

Mr. Johnston

Public enterprise has failed only in so far as the Government refuse to get on with it.

Lieut.-Colonel Elliot

And the Government before?

Mr. Johnston

And the Government before, yes. That is what I am saying. Since we on this side of the Committee are not in power at the moment we cannot do anything about it. What I am doing is the next best thing: I am trying to bring some encouragement to the hon. Member for Edinburgh, South.

Sir W. Darling

Is the hon. and learned Gentleman repentant now that he is not in power?

Mr. Johnston

I cannot think of an adequate reply to that, but I think there is much in the hon. Member's idea, and I think it well worth trying, and I should certainly support him if he were to go further with his project.

Is there any reason why we in Scotland should not carry on with these local investment trusts? We have to get local enthusiasm. To get local enthusiasm means that we must start in places where there is local enthusiasm. The obvious places are either in my own constituency, which has a great pride in being itself, or in the North-East of Scotland. Of course, we must have local rivalry. Local rivalry can be quite easily engendered. I may engender a little myself today by saying that it would be quite impossible to start in Edinburgh, which lies somewhere between the Celtic twilight of 1746 and the founding of the "Edinburgh Review" about the beginning of the 19th century. That is one of our difficulties in Scotland. We are inclined to look over our shoulders to what we imagine were the glories of the past rather than to get on with making a success of the second half of the 20th Century.

I put this suggestion forward. I give it to the two hon. Members for Aberdeen, and I hope that city, which I know very well, may start it. They have the people in it and they have the money, and they might start by building a first-class new trawler and show up some of those awful things that lie about the docks, which I have seen so often. The second thing they might do is look at the question of quick-freeze, and the third thing they might do is see whether they cannot stop this habit, spoken of by the hon. and gallant Member for Perth and East Perthshire yesterday, of moving beef on the hoof rather than wholly processed from the North-East. I think that there should be in Aberdeen and in Aberdeenshire such processes so that there would be no beef cattle moved on the hoof, other than those magnificent animals which go to the Americas.

There are many other ideas which might be applied and which the extremely able people in Aberdeen could do. I would make it a local thing, and I see no reason why it should not be a success. It can be a success if interest in Aberdeen is aroused, not only the interest of the people with a large amount of money but, much more important, the interest of the people with a small amount of money, because I think that the day of large investment by the single individual has gone, and we had better recognise that it has probably gone for ever. There is no reason why this local interest should not be aroused, and if there is a certain amount of share peddling I have no doubt that the Lord Advocate will tell the President of the Board of Trade that, despite the statute about share pushing, he has no intention of applying it to local projects.

These are things which we can do for ourselves. I think that, in the light of the present Government and the Secretary of State for Scotland, we have to do them as largely for ourselves as we can, because I have no hope, quite frankly, of the present Government doing a great deal for industry in Scotland. I should like to believe that they would, but I do not think that they will. If they cannot, we have to do them for ourselves, and I think that it is a good thing possibly that we should.

Sir W. Darling

Hear, hear.

Mr. Johnston

I have at least got the encouragement of the hon. Member for Edinburgh, South. Of course, there are difficulties, and let us face them. The difficulty of local investment is not only a question of raising the necessary risk capital; there is the difficulty which arises from a very good quality carried to excess, and that is that Scotsmen on the whole are a highly individualistic race, and that individualism is carried to such an extent that we are very unwilling to combine one with the other. We would prefer to be cock of our own dung-hill than scratch a living with another in a much better midden. I am sure that whatever difficulty the President of the Board of Trade may have in understanding that language that the hon. Member for Aberdeenshire, East (Sir R. Boothby) has none.

That individualism results, as I say, in what I regard as too many small local companies which might very well be combined together, and if combined together would offer, first, better opportunity for investment, and second, better opportunity for expanding trade. I do not believe that the large company has necessarily any virtue which the small has not; I do not think it has. I think that it depends entirely, first, on the nature of the trade, second, on the amount of capital necessary, and third—and most important—on the capacity of the persons at the top who run it. One man may run a platoon successfully and another an army group.

I think that we have in these investment corporations I have suggested to walk warily and proceed to necessary extensions. Much of the necessary extension of business is retarded because of the fear that if a business is expanded the person in control will lose control. He is unwilling to enter into partnership with "B" and to take "B" in as a shareholder because he fears that "B" may gain control. That is a matter which has to be got over and it is difficult to get over because of the psychology of the Scotsman. But it can be got over, and has been got over frequently in the past.

The other difficulty of industry in Scotland—and it is a difficulty which was mentioned yesterday by the Parliamentary Secretary and which caused me some disturbance—is that towards the end of his speech he said, in effect, that if a trade recession were to come, which naturally both he and I hope does not come, those at the circumference would suffer more quickly than those at the centre because of our geographical situation. I think that is not necessarily so. I think that we have to consider the location of our industry afresh in this country. Every time I move about this City of London I regret that the statute of Elizabeth I, I think it was, was not put into effect—the statute which was intended to prohibit the growth of the City of London. I think that it is a fantastic place and must be very, very expensive not only to the individual, which we all know about, but to the country as a whole. Quite apart from that, I should think that the Minister of Defence goes to bed with a headache every night when he thinks of the defence of this area of the United Kingdom.

If we are to distribute our industry, we have to take positive Government action. I am surprised that more positive Government action has not been taken in view of our experiences in the period from 1939 to 1945. Secondly, we really must look into the question of costs of transport. I realise, as everyone does, that the ideal situation so far as cost is concerned is to have the consumer industries near to where their products will be consumed. That is, of course, the question of cost as it affects the producer and the immediate consumer. I am, however, far from satisfied that that is the best way so far as the economics of the country are concerned.

A factory might be erected on the Great West Road because it is to supply London, and the transport costs appear to be cheaper than if the factory were in the constituency of, say, the hon. Member for Aberdeenshire, East. As far as rail charges alone are concerned, it is cheaper; but the question of cost involves far more than that. The cost to the community of siting a factory on the Great West Road must be appallingly high. It involves the provision of roads and transport, housing and schools, in an area which is already grossly congested and which is nothing more or less than a bull's eye in the event of enemy aggression.

Sir Robert Boothby (Aberdeenshire, East)

The hon. and learned Gentleman has referred to my constituency. The only thing that stops people putting factories in my constituency and makes them put them on the Great West Road is the cost of transporting the products of the factories in my constituency to the markets in the South. Get rid of that, and we will get all the factories that we want.

Mr. Johnston

I thought I had made my point; if not, the hon. Member has made it for me.

So far as I know, there has never been an examination of this question of the cost of location of factories. It would make an admirable subject for investigation by the Cambridge School of Economics or some similar body. It is always assumed, simply by looking at the cost of moving from "A" to "B," that the shorter the distance the cheaper the proposition; but it is not necessarily so if one regards, not the cost to the producer and the consumer, but the cost to the country as a whole. I should certainly like to hear of the possibility of introducing either a flat rate or a tapering charge—and it can be done now that we have nationalised railways.

Sir R. Boothby

Hear, hear.

Mr. Johnston

But I do not think that any of my suggestions are nearly as important as the question of morale. To those Members who have not seen it, I commend an article in a paper with which I often disagree—the "Economist"— which this week analyses what might be called success in building up industry. The great difference between this country and the United States is the sort of bounce that the American economy has. That bounce, if I may so describe it, is because the citizens of that country believe that they are "going places." They are willing to experiment.

On the whole, we are far too conservative. In the past—but not now, I hope— we lacked that push which is really a belief in our own future. The biggest thing that matters in the success of the United Kingdom as a whole, and Scotland in particular, is a belief in our own future. Whatever the complexion of the Government, we should have a great belief in our future.

Going about Scotland as I do, and being old enough to remember the silly 1920s and 1930s, I notice nowadays a remarkable difference in the climate of opinion and belief in our own country. The best example of that is this two day's debate. It has not been the kind of debate, as was often the case in the past, in which the Government were asked to do this, that or the other, but it has been a debate which displayed a determination to try to do something, with or without Government assistance, for ourselves.

4.36 p.m.

The President of the Board of Trade (Mr. Peter Thorneycroft)

It may be for the convenience of the Committee if I intervene for a few moments at this stage. We are spending two days in debating the industry, employment and economic well-being of Scotland. Having listened to the greater part of the debate yesterday, from the speeches of the right hon. Member for East Stirlingshire (Mr. Woodburn) and of my right hon. Friend the Secretary of State, throughout the debate and including the speech to which we have just listened from the hon. and learned Member for Paisley (Mr. D. Johnston), I think that we have had a dispassionate, objective and wholly helpful analysis of the problems with which we have to deal. I shall try to maintain the same tradition.

My claim to speak in the debate is due not to any native origin, but to my position as President of the Board of Trade. The Board of Trade have many responsibilities affecting Scotland. To start with, we are what is called the production Department—not that we produce things, but we answer questions about them—for a large number of industries which are situated in Scotland. In addition, we are the Department responsible for commercial policy. I agree wholeheartedly with the hon. and learned Member for Paisley when he said that it is in the wider aspects of our economy, not only in manufacturing, but in selling, that we must look for the prosperity which we desire.

I rather liked the way in which the hon. and learned Gentleman glanced back almost nostalgically at the 19th century. I am inclined to agree with him in his elaboration of the many virtues of our Victorian ancestors in this matter. I was only a little sorry that having begun with the praise of thrift, he came very nearly to advocating share-pushing in the later part of his remarks.

Mr. A. Woodburn (Clackmannan and East Stirlingshire)

That is collecting thrift.

Mr. Thorneycroft

One of the principal responsibilities of the Board of Trade in Scotland concerns the range of problems to which we generally refer under the general term of "Distribution of Industry." Where is industry to be found, how is enterprise to be encouraged, when and where should factories be started and people employed, and what is our attitude to Development Areas? Many hon. Members yesterday devoted a great part of their remarks to dealing with these problems, and I want to say a few words about them.

I should like to begin, however, with a few general observations. I do not want to be dogmatic about these issues, but I think it is worth while trying to get the problems of manufacturing industry in Scotland into some kind of perspective. We would be deceiving ourselves if we pretended that there was some trick solution connected with distribution of industry policy which could bring about a major alteration in Scottish economy. The life of a great nation is not really determined by how a Development Area is demarcated or by the precise terms and conditions upon which Government assistance can be given in the way of building factories.

Scotland's future, as many hon. Members said in the course of the debate, does not depend on minor adjustments in administration. It depends on the skill of her people, on her resources and on the energy with which the people of Scotland fling themselves into the development of their great basic industries of agriculture, fishing, forestry, iron and steel, shipbuilding or heavy engineering. Unless those foundations are established and maintained nothing else is possible. No alterations in distribution of industry policy will serve unless the foundations are right. Equally, if those great basic industries of Scotland are prosperous and expanding, then it is true to say that other industries will be attracted there by reason of the very demand which that expansion will create. I make no apology for stating what are the elementary fundamentals of the situation in any policy for Scotland.

I should like now to say a few words about the role which any Government can play. In a sense the role of Government is in any event a limited one. Governments can persuade if they chose; they can, I suppose, from time to time direct; they can encourage people sometimes and they can obstruct people; but very seldom—and this only in a rather limited field—can they initiate. The right hon. Member for East Stirlingshire asked could we not do more in getting the nationalised industries to Scotland or expanding them there. The first thing I would say about that is that the same principles apply to industry whether it is publicly owned or privately owned. The nationalised industries cannot be expected to accept terms and conditions less advantageous than those enjoyed by private industry in the same sort of role.

Certain of the nationalised industries are not appropriate for certain areas of Scotland. There cannot be coal mining all over the Highlands. Do not let us underestimate what the nationalised industries have done in the Highlands in recent years. I need not remind the right hon. Gentleman what the North of Scotland Hydro-Electric Board, for example, have done in that area. But whatever one can do with the nationalised industries, the dynamic forces which are essential to progress must come, under all Governments at least in the main, from the ideas and ambitions of individual, private people. If those are not present nothing else is very likely to prosper.

Mr. Woodburn

I do not disagree with what the right hon. Gentleman is saying, but let me give him an example of what can be done by Government persuasion. Some time ago the Government persuaded the Department of Scientific and Industrial Research to establish a research post in the new town of Kilbride, and from that station has come new ideas, new science, new industry and improvements in matters of health. Just after the war we persuaded Ferranti to remain in Edinburgh and develop electronics. What I was meaning was that the establishment of some of the new types of industries in Scotland instead of South of the Border is a way in which the Government could help.

Mr. Thorneycroft

I am not in any way under-estimating the role that the Government can play in these things. What I am saying is that in no circumstances whatsoever can action by the Government be a substitution for native industry, without which no sort of industrial prosperity could be sustained. What the United Kingdom wants, and what Scotland in particular wants, is a constant flow of ambitious enterprising men, profit seeking men if hon. Members like that, who are prepared to go to these places and set up industries there. They have not died out in this country.

I should like to give, if I may, an illustration of the sort of thing that I have in mind. About eight or nine years before the last war there was a scientist in London University who conceived the idea that he could get something useful in the way of chemicals out of seaweed. He used to go down to Bournemouth and bring some seaweed back in a bucket. He carried out experiments and he borrowed a lot of money from his friends. They spent up to £100,000 without getting any real return upon it, but at the outbreak of war, in part with the help of the bankers and in part with the help of the Government, they did establish the alginate industry which is a useful and prosperous enterprise, serving not only those who have got their money in it but the economy of the country as a whole. That is the kind of enterprise which is needed if we are to have the prosperity we require. We need men with ideas.

I now come to what the hon. and learned Gentleman the Member for Paisley (Mr. D. Johnston) was saying on this subject. The "Financial Times" a week or two ago, in what I thought was a wholly admirable supplement on British industry, carried an article on this point by Professor Paish, and I should like to quote two paragraphs from that article which are directly relevant to the argument which the hon. and learned Gentleman addressed to the House. Professor Paish was dealing with the same point as the hon. and learned Gentleman—what are we to do for the smaller industries to get them established? He said: These problems are particularly those connected with the establishment and growth of new businesses and industries which in the past have proved so potent a means of rejuvenating an economy tending towards stagnation. The low level of personal savings and the high levels of Surtax, death duties and (even after the recent reductions) of company taxation, combine to make it difficult or impossible for the successful small firm to get and keep the risk capital essential for rapid growth. The present system favours the large company with an established position as against the small, efficient concern that might have grown to supplant it. Unless a complete reversal of recent tendencies once again makes a substantial amount of personal saving possible, or unless business profits, while no doubt harder to make, can be more fully retained, we must probably continue to rely on existing large companies, often without the spur of competition, to bring that flexibility and adaptability into the system that new businesses and industries so often gave us in the past. I believe that that is a penetrating analysis of the problem which we are up against, and I cannot over-emphasise that it lies at the very centre of Scotland's present difficulties. How are we to get these new ideas translated into production?

The hon. and learned Gentleman, in a speech which was closely reasoned and extremely interesting upon this point, went straight to the heart of the matter. He said that there was a reluctance to risk capital because investment was local. I suggest that there is a much more practical way of getting the capital, the return on which from investment after taxation is not worth it. That is the basic reason why there is a shortage of this capital at present.

Mr. John Rankin (Glasgow, Tradeston)

Who is imposing the taxation?

Mr. Thorneycroft

All Governments have for a long time.

The hon. and learned Gentleman tackled the subject boldly and sought to propound a solution. He said we must accept the situation that in the future we shall not get that risk capital. Therefore, Government must in some way or another provide it. I ask the hon. and learned Gentleman and his hon. Friends to think carefully before they pursue that line very far. What does it mean when they say that Government will provide it? The Government has no risk capital available. The only moneys that a Government can raise come by further taxation, and the higher taxation is raised the more existing industries are starved of the moneys they require. Moreover, when they have raised taxation and thereby exacerbated the existing difficulties of some industries, where is the money put and who decides it?

"Government" sounds good, but Governments are composed of people like the hon. and learned Gentleman and myself, in the last resort. Ministers have many and large responsibilities. The idea that the President of the Board of Trade should go round Scotland to see where he can find a method of getting something new out of seaweed is something which appals me as a serious contribution to what is admittedly a great and grave problem, namely, how to provide the capital necessary for industry to thrive.

Mr. Thomas Fraser (Hamilton)

Seaweed does not appal the Secretary of State.

Mr. Thorneycroft

I agree that there are many ways in which Governments can and should help and I am coming to that side of it in a moment.

I am saying this: do not imagine that we can solve a basic shortage of risk capital by inviting Government to take over the roles which should normally be played by enterprising investors. The relaxations announced in the Budget on company taxation and Income Tax will help substantially in this direction. A start on that road was a prerequisite to any solid hope of increasing industrial development in Scotland.

If that should be the role of Government, as the hon. Gentleman said in a pertinent passage at the end of his speech, industry, and particularly Scottish industry, has a big responsibility upon its shoulders. If we are asked to ask men to establish new industries or branch factories in the remoter parts of Scotland, surely the people we should ask are the Scots themselves. And if they will not do it, one can hardly expect the industry to arrive from, say, Surrey. I think that is the common view expressed.

Now I turn from the question of what industry can start to where it should go. The powers of the Board of Trade in this matter are limited. We can urge, we can encourage, in some cases we actually give practical help in the establishment of a factory, but we cannot direct. I am glad that we cannot direct. I think all Governments have been wise not to take powers to direct. In practice, the method throughout the United Kingdom has been to establish Development Areas within which special help, including the building of factories, can be given.

Now I want to say a word about how Scotland has been treated. About half the population of Scotland lives in one or other of the various parts of the Development Area—2,600,000 people live inside that Development Area. In those circumstances it is not easy to argue that the Development Area is not big enough, though pressure has from time to time been put not only on me but on previous Governments to extend it in one direction or another. That pressure has been resisted both on the ground that in the individual cases the prerequisites laid down by the Act have not been fulfilled and, more particularly, on the general ground that the wider the area is spread in which special assistance can be given, the more meaningless must the assistance inevitably become.

There is one point of principle raised in this debate. It centres round what might be called the Cairncross approach to this matter. That report suggested that the first objective of assisting development should be to accelerate the growth of new industrial communities in promising locations. Industrial growth should come first, ahead even of the need to reduce unemployment in other areas. That was the gist of the Cairncross approach—help the developing area at least ahead of the Development Areas.

Obviously, powerful arguments can be made out in support of an approach of that kind It has many attractions, but I ask the Committee to face the implications of that approach if it were accepted. There is, after all, only a limited amount of free industry, and if we were to weaken or abandon our approach from the Development Area policy we should at the same time, abandon one of the principal weapons which all Governments have had in their hands for dealing with the unemployment problem.

I put this issue to the House on 25th February last in a debate on the wider issues of distribution of industry policy. At that time I noticed little support from Scottish Members in the House for abandoning the approach hitherto made. Let us consider how it would affect localities, for example, Lanarkshire. The hon. Lady the Member for Lanarkshire, North (Miss Herbison), in an extremely eloquent and persuasive speech yesterday evening, on the problems of her area, spoke of the declining coalfield. Under the Cairncross approach Lanarkshire would not do so well as under the existing policy. Lanarkshire is a declining, not a developing, area; and in those circumstances and under Cairncross the weight of effort by Government would be transferred to other parts of Scotland.

The problem raised by the hon. Lady was also referred to by the hon. Members for Midlothian and Peebles (Mr. Pryde) and Dumfries (Mr. N. Macpherson). It is a real and difficult one. Where new coalfields are being developed and to the extent, which is not yet known precisely, that new coal miners are required in these new fields, the transfer of those workers is obviously the right course. We should have no hesitation about that. Coal is necessary, the work is there, and if the coal is there then the workers in that industry at any rate have to go where the work is.

As the hon. Lady said, however, with new developments in the coalfields it may well be that not all the cases would be covered. Where that is so, the policy which must be pursued by all Governments is the policy we have pursued hitherto. Do not let us abandon it. In spite of all the difficulties, which we all know, let us try to influence or assist new industries to set up in those areas in order to take up any unemployment which might develop. In any event, we cannot have it both ways. A new factory can either be in a developing area or a Development Area. It cannot be in both, and for the moment we should do better to stick to the policy we are now pursuing.

Having said that, let me emphasise that the Development Areas have not an exclusive claim to industry. Areas where there are pockets of unemployment and which are perhaps of too narrowly circumscribed a character to form part of a larger Development Area are given special consideration. We try to steer industry to them, and we give them certain preferences in the case of raw materials, Government contracts and matters of that sort. There has to be a flexibility in approach; I fully accept that.

It was with that in mind that I have been trying to do something in the case of Buckie—Peterhead. I do not pretend at this moment that I have been successful, but I have not stopped trying yet. This is a small area, largely rural and probably unsuited to the full Development Area technique. In fact, two or three small factories might do the trick. To some extent it illustrates the problems of Scotland to reflect that the energies of the Board of Trade, the Scottish Council and everyone else so far have not yet succeeded in solving that problem, I am hopeful that we shall do so before we finish.

My hon. Friend the Member for Govan (Mr. J. N. Browne) suggested that we ought not only to build the factories, but put in the machinery as well. There is a limit to the extent to which the economics of the situation can be distorted. A lot can be done to help an industry to start. Facilities can be given for cheaper rent while it is getting going, but if the person establishing it cannot pay for the machinery, even by raising a loan from the bank, it does not augur well for the success of the industry later. The chances of success in this area, as in so many others, depends, I think, not a little on how far Scottish industry is prepared to help itself.

Then there is the question of the new towns. Clearly, where there are new towns there is a need to balance the building of houses with the building of the industries. There are two new towns under construction—East Kilbride and Glenrothes. East Kilbride is in a Development Area, so the principles which I have just described would apply. Glenrothes is in a developing coalmining area. The present inhabitants are employed either in coal or in existing industries. So, in the case of Glenrothes, the new town corporation itself has power to build factories if required, and we can, as and when necessary—there is a good deal of employment in the existing industries there—influence industrialists to go there.

I do not wish to detain the Committee too long, and I have nearly finished, but I should like to say very briefly what the general picture of factory building in Scotland has been. It has been the constant desire of all parties to encourage factory building and industrial development in Scotland, and all parties have been faced with very similar difficulties.

The post-war history of factory building in Scotland follows clearly the history of post-war trade. In the early days just after the war, when there was a pent-up demand, a world starved of goods and factories which had lacked development and maintenance, the only problem was how to space out the demand, how to meet this upsurge of desire to catch up with the years that had been lost.

By 1951, however, the post-war demands had, by general admission, begun to slacken, and the demand for factories was easing off. The position which we found in the autumn of 1951 was that a large number of factories had been started. The steel situation was extremely tight, and the position was that unless something was done it would be very difficult to complete even the factories that had been started. I am not casting any aspersions about this; there were difficulties on all sides.

In those circumstances, the right course to adopt was that which we did adopt— to place an embargo on new starts and finish the factories on which a start had already been made. The situation was brought under control, partly by external forces, partly by actions of the Government. Inflation was checked and to some extent demand was checked because that is checked when inflation is checked. The balance of payments crisis was to that extent dealt with. Today, the problem is not one of raw materials. Factories can be licensed virtually freely in any part of the United Kingdom.

What, against that background, has been done for Scotland? Scotland has 10.4 per cent. of the population, but she has 12.3 per cent. of all the new factory building which has gone on since the war. The proportion of Government factories is higher in the Scottish Development Area than in any other Development Area. The total effort by Government, both in volume and in value, in the Scottish Development Area is greater than in any other comparable Development Area.

As for the actual buildings that have been completed there, more factory space was completed in 1952 than in either 1951 or 1950. It is true that there was during that period some falling off in the demands for new starts and the issue of industrial development certificates. It is also true that in recent months there has been an upward tendency in the latter.

The industrial future of Scotland depends, as I say, not on Development Area policy; it depends upon the trading outlook for the United Kingdom as a whole. Scotland's objective should be a freely trading world, with the removal of as many physical barriers to her exports as possible. I would say to those who have the interests of Scottish industry at heart that I think we should be wrong to put much faith in the physical control of foreign transactions. That would be to put a tourniquet on Scottish trade.

What the Scots want is a battering down of barriers which at present obstruct her export trade. What they want is a situation in which men all over the world are prepared to invest in Scotland, to do which they need to have some hope some time of being able to repatriate at least their profits and probably their capital if they wish to do so. What is needed is the establishment of the largest area of trade and payments which we can devise.

The outlook for the future is not one of lush, easy markets; it is one in which only competitive industries will be able to sell, an outlook peculiarly suited to the integrity and hard-working nature of the Scottish character. The type of things Scots produce—their skill in engineering, the sort of things they want to sell—are those appropriate to the kind of world which we are entering.

I have found this to be a useful and valuable debate. I have listened to all the points that have been made, and I hope to listen to many more during the course of the day. I have not been able to reply to all the points, but I will certainly promise to study in detail all the suggestions that have been made. When the House rises I intend to see some of these areas in Scotland for myself and to renew the co-operation and study which we have initiated in this two days' discussion.

The Temporary Chairman (Major W. J. Anstruther-Gray)

Mr. Timmons.

Mr. W. G. Bennett (Glasgow, Wood)

On a point of order. May I ask your advice, Major Anstruther-Gray? Could you advise the Committee as to how long each Member might be expected to speak? In view of the number who would like to do so and have some contribution to make, it might be helpful to the Members of the Committee.

The Temporary Chairman

I have no control over the length of time which any Member speaks, but I have always understood that brevity was to be encouraged.

5.10 p.m.

Mr. John Timmons (Bothwell)

It is almost a year to the day since we had a somewhat similar debate, when many subjects were raised, and many suggestions were made in a general examination of the Scottish picture. We have now to ask ourselves, has Scotland changed for better or for worse? Personally, I think that the general picture is more or less static, with the exception that the recession has affected some areas more than others.

I do not wish to repeat what I said a year ago. I wish briefly to deal with some of the questions relating to the Development Area with which the President of the Board of Trade has just dealt. I disagree entirely with him in his reference to Lanarkshire as a declining area. I will prove to him later that it is not a declining area. We have to ask ourselves again what is the position with regard to new industries—

Mr. Thorneycroft

When I used the term "declining" I did not mean to imply any reflection on Lanarkshire, but that the coal seams were being worked out in that county.

Mr. Timmons

The position in Scotland, so far as I can see, has been more or less static in the last year. The situation has not improved and the constituency I represent is in one of the areas which have suffered very severely in the last 12 months. The right hon. Gentleman has been dealing with industrial estates and further schemes projected for the building of new factories. I hope that the areas which are to get those factories will have more success with them than has been the experience in my constituency.

I want to draw attention to some of the changes which have taken place in the past year. The Parliamentary Secretary knows very well what has happened about Vactric, because we have discussed this matter on more than one occasion. This time last year there were 1,300 to 1,400 people working there but today I am doubtful if there are 100. I want to know to what extent the Treasury were responsible in this matter. There is a general opinion that to a great extent Vactric was financed by the Treasury or at any rate they have the majority on the board of directors. Right or wrong, the general opinion is that the Treasury called in £300,000 odd invested in Vactric and, in order to realise their assets, had to clear out and go to a small factory in the south. Had a Labour Government continued in office that line of action would not have been taken at the time when there was a general recession in trade.

That is not the only case. There were many other factories whose production has gone down at Newhouses, Chapelhall, Carfin and Queenslie. There has been a great drop in the personnel employed in them. Smith's clock factory at Carfin was closed down a year ago. It was a big factory and at the time was employing more than 1,000. They cleared off and went to another factory, which was much larger and better able to meet their requirements. That factory was let to the Standard Cable and Telephone Company who have been there almost a year. A few days ago I went there and saw 25 wee girls working, and that is all there is there after a year. I understand that these people were advised by the Ministry of Supply to go there and take over the factory but, up to the moment, the Ministry of Supply have not told them what they are to produce there. Even when the Ministry make up their mind it will take six to nine months to get that factory going. That is not stimulating employment and well being in Lanarkshire.

Chapelhall have many fewer people employed than there were a year ago, and none of these factories is being used to capacity or serving the purposes for which they were intended. When such factories are built in a Development Area and millions of pounds are expended it is not very encouraging if the factories are left practically empty. Before building more factories the first thing the Government should do is to ensure that the factories already there are working to full capacity.

At Queenslie a firm were producing Olivetti typewriters, but they are reduced to an infinitesimal number. Other factories are not working to capacity and during the past year there has been a general deterioration of the situation in my constituency and in Lanarkshire generally. I ask the President of the Board of Trade and the Secretary of State for Scotland to note that people are asking what is happening to these areas and about the possibility of getting factories started there. I ask whoever is to reply to the debate to give some indication of what is to happen in this situation in order that I may go back and tell the people in Lanarkshire what the position is.

There was a rather amusing suggestion I heard a month ago about certain people who were trying to finance an undertaking which was to take over a huge factory of some 300,000 square feet and use it as a sort of indoor sports stadium. It is a serious situation if we have to build factories to the extent we have and spend money on them and provide plant and then see a beautiful factory taken over by people who are enterprising enough to make a profit out of it, to use it for a purpose for which it was not intended, but as a sports stadium. That is a shocking state of affairs. I ask the President of the Board of Trade and the Secretary of State for Scotland to apply their minds to this problem. I hope I shall meet the President when he comes to Scotland. I think he may get a rude awakening when he comes to Lanarkshire.

In the last few years in Lanarkshire we have built many new industries and changed the whole pattern of industry. We have many people skilled and semiskilled who have been trained to work in those new industries but what is happening to the skill they have acquired? Many of them are now working on new housing schemes and all the new skill they learned has gone for nothing. Lanarkshire Education Committee adjusted the curricula in their technical colleges to meet the needs of new industries which were springing up in Lanarkshire since the end of the war. New curricula on the technical side has been provided in order to meet the demands of new industries, but at the end of the day there is not much prospects for the student.

There are other questions to be considered. I assure the hon. Member for Woodside (Mr. W. G. Bennett) that I do not intend to delay the Committee too long, because I sat here all day yesterday. I want the President of the Board of Trade and the Secretary of State for Scotland to give some consideration and thought to these matters. The President of the Board of Trade said that Lanarkshire was a declining area. He does not know Lanarkshire. It is not a declining area. There has been a re-organisation of the iron and steel industry and there is a projected scheme costing about £25 million for Lanarkshire. New blast furnaces, coke oven plants and melting shops are to be built.

Great developments are going on in my constituency. At Bellshill Stewarts and Lloyds are going ahead with a big scheme which should provide additional employment for 700 to 800 strong young men. Such large amounts of capital would not be spent on new developments in Lanarkshire if it were a declining county. Colvilles have opened new coke ovens at Tollcross. If an iron and steel industry is to be expanded on a big scale in Lanarkshire, it is absolutely essential to have adequate supplies of coking coal at reasonable prices for the blast furnaces and coke oven plants.

That brings me to the question of the "dying coalfield" of Lanarkshire. It is far from being a dying coalfield. If the right hon. Gentleman goes to the proper sources he will find that Lanarkshire has certainly not exhausted its coal reserves. In the report of the Secretary of State for Scotland last year reference was made to bores being carried out to the north-east of Glasgow. Five bores have been drilled—it may now be six—and two seams of coal have been found, one of them being of the richest coking coal in the British coalfields. The right hon. Gentleman is laughing. I do not know what he is laughing at.

Mr. Thorneycroft

I am not laughing at the hon. Gentleman.

Mr. Timmons

It is very rude anyway. That coalfield extends over an area of about 15 square miles. It goes right up to Brillieston and across the Clyde. The bores have shown a regulated thickness and they have proved the thickness of the seams. If the Minister of Fuel and Power had been here I should have asked him to direct the National Coal Board to go ahead with some developments in this direction and not wait until the whole of the Clyde Valley area is exhausted. These new sinkings should be made ready for development by the time the other pits close.

In September last I and my hon. Friend the Member for Lanarkshire, North (Miss Herbison) were invited to meet representatives of the National Coal Board to discuss with a number of miners the reopening of a pit in the Salsburgh area I told my hon. Friend that I wanted to discuss with representatives of the Coal Board something more important than the reopening of one pit. Soon after we had got down to the discussion, I could see that it was no use whatever to recommend the opening of the pit. I went on to discuss another area, the area where the Anglo-Iranian Oil Co. have bored for oil. The borings have shown that there is plenty of coal in that area of Lanarkshire. It covers a very vast area and some of the seams are very thick.

Two years ago I submitted a memorandum to the then Minister of Fuel and Power about the Lanarkshire coalfield and asked that two mines should be driven to take out the two upper seams, which were two feet thick, and that would have provided employment for 300 or 350 miners who were working on housing schemes and other projects. If those two mines were driven, we should be on the coal within a month. This development could have taken place. We met representatives of the National Coal Board in September last year, and I put the proposal to them. A representative of the geological survey said that, judging by the bores, they were not satisfied that coal existed. I said that I was as much entitled to assume that what was indicated by the bores was coal as he was entitled to assume that it was not. Eventually the Coal Board decided to satisfy my hon. Friend and me by drilling another bore, which would take a fortnight at most, and it was agreed that a report should be made to my hon. Friend and me. We have had no report. However, we are satisfied that no further bore is required and that the coal exists there.

We also discussed the Newhouse area. In 1939 the United Coal Company—I did not seek this information; it was given to me voluntarily by the chairman of the company—said that the whole future of the company was in the Newhouse area, where there was main coal at a depth of 70 fathoms below the River Drumgarry. There was a project in 1939 to resink two pits and go down further to the seams and develop the whole area. We discussed that with representatives of the National Coal Board in September. However, nothing has yet been done about it although we know perfectly well that the coal is there.

We also know that it has been the policy of the National Coal Board to close Lanarkshire. There are three areas in Lanarkshire where development could take place which would provide employment for nearly all the people who are still surplus to requirements. Men who have spent their life in the mining industry, including many young men, are knocking around in factories and working as labourers. They are working on housing sites or on road schemes or in sewers and they are men who would prefer to be producing coal for the nation. Because of domestic ties and for various other reasons they are not available for transfer to new areas.

Regarding the figure of 82 per cent. of redundant miners mentioned in the Report, and the numbers which have been transferred, I wonder if a check has been kept on the number of miners who have come back, because they have been coming back almost as fast as they have been going. These are the problems with which we are concerned in Lanarkshire. If we wish the co-ordination of new developments in the iron and steel industry to go ahead it is essential that we have adequate supplies of coking coal. I appeal to the Secretary of State, and particularly to the Minister of Fuel and Power, to use the powers of direction he possesses to ask the Coal Board to go ahead with these new developments in preparation for a decline in the Clyde Valley area

5.31 p.m.

Lady Tweedsmuir (Aberdeen, South)

The hon. Member for Bothwell (Mr. Timmons) was right to deal at such length with the coal industry in his constituency. Were we able to solve in greater measure some of the problems confronting this basic industry many of our export difficulties would be overcome. There is no coal industry in my constituency, but I wish to discuss the question of the allocation of industry, and to say a word about one of the most important industries in my constituency, that of fishing.

We were encouraged by the general review given by the Secretary of State yesterday and will examine it against some of the reasons why he and the President of the Board of Trade were not keen on the main recommendations of the Cairncross Report. I agree it is right that we should concentrate on those areas where unemployment is heaviest. We must remember that in Scotland we are lucky enough to have an unemployment rate of only 2.7 per cent. Surely this is the moment when we should try to spread our industry a little wider. Should the unemployment figure rise, it would then be argued that it was impossible to do so.

In this country, and under a Conservative Government, we do not believe in the direction of industry or the direction of labour—

Mr. Emrys Hughes (South Ayrshire)

Some of us do.

Lady Tweedsmuir

The hon. Member says that some of us do. Yesterday I noticed that one hon. Member opposite, I think it was the hon. Member for Dunbartonshire, East (Mr. Bence) was so much in favour of State control that he suggested that the Scottish Office and the Government should equip and run factories direct. Perhaps the intervention of the hon. Member for South Ayrshire (Mr. Emrys Hughes) goes to show the confusion of thought among many hon. Members opposite as to what is their policy regarding Scotland—

Mr. Hughes

The hon. Lady did not get the point of my interruption. We do direct people. We have conscription. We directed 20,000 people into the Armed Forces and to all parts of the world last year.

Lady Tweedsmuir

The Defence Vote is not down for discussion this afternoon.

I say that the intervention of the hon. Member for South Ayrshire and the statements made yesterday reveal the confusion of thought on Scottish policy among hon. Members opposite. I should not be surprised if at the forthcoming Labour Party conference a good deal is said about the lack of policy regarding Scotland, because in "Challenge to Britain" there is only a tiny paragraph about Labour policy for Scotland.

Mr. Woodburn

The hon. Lady has made her comments, but I invited the Secretary of State yesterday to tell us what was the Government's policy. I think the noble Lady must agree the answer was that the future policy of the Government amounts to exactly nothing.

Lady Tweedsmuir

I entirely disagree with the right hon. Gentleman—

Mr. A. C. Manuel (Central Ayrshire)

In what way?

Lady Tweedsmuir

I agree that there are certain points on which we have not had sufficient information from the Secretary of State, and it is to those I wish to refer.

As we do not direct industry, or have direction of labour, we have to persuade and cajole industry to go to the North. I have been very disappointed that no Minister has yet dealt with the problem of freight charges confronting industry in the North. How are we to get industry going in the North unless we tackle problem? I understand that the British Transport Commission have submitted a charges scheme to the Government. Some members of the Commission including the Chairman, are due to retire, and presumably they will be replaced.

I wish to ask the Under-Secretary whether the Government have had time to examine the charges scheme and whether a decision will be taken upon it before the appointment of the new members to the Commission. Will the necessary legislation be introduced to ensure that there are steeper tapering rates for freight in the more distant areas from the consuming centres? If we can deal with that problem there will be a far greater natural inducement to industry to go to the North.

The hon. and learned Gentleman the Member for Paisley (Mr. D. Johnston), who opened the debate, devoted a large part of his speech to the question of credit facilities for industry. As we have had an encouraging review of our gold and dollar position, and as this country is now in a better trading position, I believe that the Government should consider the possibility of giving guidance to the banks to extend greater credit facilities to firms willing to establish themselves in the areas which the Government wish to see developed.

The Government can do only a limited amount regarding construction and it has been stated from the benches opposite that there are only a limited number of light industries to go round. Would it not be possible for the Government to consider placing one direct defence contract in the North-East of Scotland, say, in the City of Aberdeen? It would then be possible for Aberdeen to sub-contract out to the areas of Buckie and Peterhead. Aberdeen has all the facilities. During the war we were able to undertake defence contracts and sub-contract out to other areas, with great benefit to Aberdeen and to the North-East of Scotland as a whole.

Not only did this lead to the employment of a great deal of unskilled labour, but it also prevented skilled fitters and others from drifting to the south, which is what is happening to some extent today. If we could have some such arrangement local authorities in places like Buckie and Peterhead would, of course, do everything in their power to help to foster local growths.

As well as bringing in new industries it is vital that we should concentrate on our basic industries, and I would ask the Under-Secretary whether he is satisfied that there is any easing of the shortage of steel plates for shipbuilding. The Admiralty have afforded a good deal of assistance in securing more steel plates for certain industries in Aberdeen, but, nevertheless, some companies find it difficult to secure firm delivery dates.

Our basic and most important industry is fishing and at present the fishermen are facing great difficulties. Today, we have an opportunity to discuss not only Chapter VII of the Report on Industry and Employment, which deals specifically with fishing, but also the second Report of the White Fish Authority. It seems to me that it is plain that since the first Report of the Authority was issued there has been a decline in the fishing industry in Scotland. The weight of white fish other than shell fish caught during the last year is down by 5 per cent. and the value of the catch is down by 10 per cent. British landings in near and middle waters are down by nearly 10,000 tons and the value by nearly £750,000.

Aberdeen, as the largest port in the Scottish fishing industry, has always been confronted with the problem so ably described by the President of the Board of Trade, namely, what is the part that the Government should play and what is the part that the industry itself should play? Obviously, neither can succeed alone. There are four points about which I want further information. First, there is the question of freight rates. Secondly, there is the vast question of overfishing. Has Iceland agreed that the action she has taken should be discussed by the Permanent Commission on Overfishing?

Thirdly, there are the fishing rights of foreign Governments. My hon. Friend the Member for East Aberdeenshire (Sir R. Boothby) asked a Question recently about the Moray Firth. I wish to ask the Government whether they do or do not accept the ruling of The Hague Court in the recent action. If they accept it what are their views on the closing or otherwise of the Moray Firth? Fourthly, I want once again to ask what is the view of the Government on the question of foreign landings.

The White Fish Authority suggest that when the present fisheries dispute is settled we cannot maintain the present unregulated conditions of foreign landings. Most of us know that the Icelanders are tough people. I doubt whether that dispute will be settled for a very long time, if ever. I do not believe that we can wait for it to be settled. Therefore, I want the Joint Under-Secretary to tell us whether the Government have a scheme of import control.

We know that the General Agreement on Tariffs and Trade imposes certain restrictions on British landings as well as on foreign landings under certain conditions. We must also remember that we have many precedents for restricting foreign landings in time of glut. Only recently it was announced that now that the tomato crop was in flood restrictions would be placed on the import of foreign tomatoes. While we shall always need foreign landings at certain periods to supply the British market, I should have thought that in time of glut it was important to have some kind of scheme for imports.

The background to all this is the search for new fishing grounds. If the Iceland grounds are closed to us and the Faroe Banks are quickly fished out we shall find, certainly with the near and middle water fleet, that there is great difficulty about rebuilding. Yesterday, the hon. Member for Govan (Mr. J. N. Browne) delighted us with a speech—we wish we could hear him more often—in which he talked about the piscatorial paradise of this country.

He has always been blessed in his home with the very best quality fish, no doubt bought at reasonable prices. I should not like to say anything which would damage in any way the fishing industry. I have many recollections of going down to the fish market at seven o'clock in the morning—

Sir R. Boothby

Hear, hear.

Lady Tweedsmuir

Hon. Gentlemen opposite may laugh, but I assure them that on one famous occasion the hon. Member for Aberdeenshire, East (Sir R. Boothby) was persuaded by me to get up at seven o'clock in the morning. It was an experience that he has never forgotten.

Mr. Rankin

He has suffered from it ever since.

Lady Tweedsmuir

I have memories of going down in the early hours to the fish market and seeing the fish of which the hon. Member for Govan spoke that were of first quality. I also saw fish which had been badly damaged in transit. It had come from old trawlers, badly equipped, with poor icing conditions. Knowing, as I do, the conditions under which that fish would have to travel to some of the central markets, I would say that one must be careful in one's choice.

The fact remains that we must recognise that there will always be a limited home market for fish when there is a great variety of food available. More and more the consumer will want quality and reasonable price. Quality depends not only on the type of fish caught—I agree that we have some of the finest in British waters—but on the processing and handling of the catch in transport. The Report recognises many of the severe problems which affect Aberdeen, the first fishing port of Scotland. It describes how many of the marketing and other arrangements are largely uneconomic, so detracting from the quality of the product and also raising its price to the consumer.

The Report of the White Fish Authority refers to two major problems. The first is the voluntary reorganisation of the industry. The second is the creation of a marketing organisation at Aberdeen. The Report says that both these major questions are still under consideration. Can the Government give any further information about them? The White Fish Authority was established to do for the fishing industry what the industry thought that it could not do by itself. This is a vicious circle. If the Government can play their part—and I have given various instances where I think they can—then it is up to all sections of the industry to try to reorganise the industry not only for the sake of the country but in their own interests.

Recently, the House passed a Measure which gave considerable power for the provision of loans and grants for the rebuilding of the trawler fleet. The loans have not been taken up because I think there is no confidence that builders can recover their capital outlay in a reasonable period of time. It was suggested by one right hon. Gentleman that the many wealthy residents of Aberdeen might perhaps gather together and produce one trawler. I am sure that they would be only too willing to do that if they had confidence, not only in the future of the industry as a whole, but also in all the ancillary processes which are necessary after the trawler has fished and brought the fish into port.

It is because we shall not create that confidence in the industry unless all sections work together to reorganise that one has no confidence that the rebuilding of the fleet will be done on a large scale. There have been a good many inquiries about grants for fishing vessels. This means, of course, that the industry is heavily subsidised. It is subsidised because it is a strategic industry of value to the country.

The criterion for loaning or granting money from any finance corporation is that certain conditions should be met. I submit that this should also be the sanction and the safeguard of the public purse. Some people in the fishing industry have asked for guaranteed prices such as those given to agriculture. But agriculture is closely controlled. The farmer is virtually told what to grow. If he shows bad husbandry he can be dispossessed. I do not know whether the advocates of guaranteed prices for the fishing industry realise that, more than likely, that involves strict control.

We all want to see a voluntary reorganisation of the industry. There are many men of good will and enterprise in it. These men are having great difficulty in confronting those others who perhaps do not see in the industry the future which I believe there can be if all sides get together. But if we continue to drift in present conditions the way is being laid open for those who advocate closer regulation and control of this basic industry. Because of the nature of it, we on this side of the Committee do not advocate that, but I would say that, where there is reorganisation and modernisation, I would advocate some tax remission for those firms concerned in rebuilding their fleets. There are a great many people who claim the right to tax remission for one reason or another. Tax remission is given to the mining industry, and therefore why not to this basic strategic industry? I quite realise that this concession does not go to the Mercantile Marine, although they are competing against subsidised foreigners, but I have always thought that it should do.

I do not see how, unless there is some tax advantage, we shall ever have the 10 per cent. replacement of boats, which is what we all hope to see. If we have a small, modern fleet, we shall have to face the fact that we shall have fewer men in the industry, and that is a matter of great concern to those who see the fishing industry as a reserve of men for the Royal Navy in time of war. It is an apparent contradiction that, in Hull and Grimsby, which have modern fleets and no subsidy, there are more unemployed than there are in Aberdeen, and there have been times when men with skipper's tickets have gone out to get jobs as mates or even as deck hands.

I think the reason for this is not far to seek. It is because fishing is a rigid profession, and the men who are in it do not easily go into other occupations. The sea is in their blood and it is to the sea that they will always turn if they can. It is for that reason that I have for rather a long time adumbrated these problems, which cannot be discussed in five minutes, because they are basic.

It is of great concern to the whole of Scotland that this vital industry shall not be allowed to go on declining and become a dying industry, as I believe it will unless something is done. Therefore, I would say that it is not only for the Government but for all sides of the industry to try to work together in a common partnership in order to ensure that it will not be long before we can get an adequate foundation of stability and not have this endless decline that we see in all the statistics every year. It is for the Government to give us their ideas on this problem because we shall never get a solution from the Opposition, who, in their policy statement "Challenge to Britain," never mentioned the fishing industry at all.

Mr. D. Johnston

Before the noble Lady sits down, would she agree, that, in view of the long delay in getting together all the various interests in the fishing industry in Aberdeen, the only real solution now is for either the Government or the White Fish Authority to step in and force them to agree?

Lady Tweedsmuir

That is the whole crux of the problem which I was trying to discuss. I remember that, when we were debating the Bill granting loans to the fishing industry, they were to be subject to a scheme of reorganisation to be laid before Parliament, and the information which I am seeking from the Government is whether the Authority have produced the scheme and what are the Government's ideas about it.

5.54 p.m.

Mr. John Taylor (West Lothian)

One of the problems for any hon. Member who is fortunate enough to enter this "state of the nation" debate is that he or she is given so much material by the previous speaker that the temptation is to devote the whole time to answering points previously made.

I will make but one comment on one remark of the noble Lady the Member for Aberdeen, South (Lady Tweedsmuir). I thought she was on rather dangerous ground when she accused the Opposition of confusion of thought about Scottish policy, because we have had in this very remarkable debate a great deal of most unusual philosophy from unusual forces on both sides of the Committee.

For example, the hon. Member for Govan (Mr. J. N. Browne), after he had finished his peregrinations in his piscatorial paradise, was advocating a more complete kind of subsidising of industry than I have ever heard from those benches, and the noble Lady herself, in the general tenor of her speech, suggested that the industry in her own noble city could not survive without State assistance. Indeed, on this side of the Committee, there have been one or two contradictory philosophical contributions, which prove that, when we enter into a Scottish debate and deal with real practical problems, we tend to lose some of the sharp edges and become "A' Jock Tamson's bairns."

I want to use my time, however, on three points which may be regarded as constituency points, although I think that, in addition to that fact, they are also points affecting employment, industry and the well-being of Scotland. They concern the Forth Road bridge, the shale oil industry, which is a large indigenous Scottish industry, and Forth ports in general and the port of Bo'ness in particular.

I shall say very little about the Forth Road bridge, because it was mentioned by the hon. Member for Leith (Mr. Hoy), the right hon. and gallant Gentleman the Member for Kelvingrove (Lieut.-Colonel Elliot), my hon. and learned Friend the Member for Paisley (Mr. D. Johnston) and probably by others. All that need be said to the Government about this project is that we regard it as a symbol. It is more than a very necessary—a vitally and urgently necessary— link in our transport system; it is more than an urgently required transport link for the growing industry in that particular area. It is now being regarded as an earnest of the Government's real intentions towards Scotland. It is so much a necessity that to neglect it further will come to be regarded in the eyes of the public in Scotland as an affront that something more is not being done.

I thought that the speech of the Joint Under-Secretary on this subject which he made in his own constituency last week was singularly unfortunate, and particularly unfortunate coming shortly after the still more unfortunate impression which his right hon. Friend the Minister of Transport had created a week or two previously when he met a deputation in Edinburgh. All that I need say further about that is that the large expenditure which he mentioned of £30 million is probably fairly accurate in present conditions, but the proposal to spread it over a period of years would have been something which the Government could regard as a practical proposition if they had wished to make any progress on this project.

The Joint Under-Secretary of State for Scotland (Mr. Henderson Stewart)

I did not say the £30 million was for the bridge. The figure was an estimate of important road works in Scotland, other than the bridge, which called urgently for starts, if only we had the resources available.

Mr. Taylor

Yes, but those roads would not become immediately usable unless the bridge was there. In any case, some Government sooner or later will have to face the problem of providing more than £30 million to be spent on the roads in Scotland.

I now wish to say a few words about the shale oil industry of Scotland, which is largely centred in my constituency and that of my hon. Friend the Member for Midlothian and Peebles (Mr. Pryde). It is a Scottish industry with a remarkable and chequered history and is at the present time operating at a loss, a fact which confronts us with a problem which has not so far been examined to any extent in the course of this debate.

Much has been said about our native ingenuity and ability and about the benefit which Scotland derives through industrialists and business people trying to pull us by our own boot straps out of our difficulties, to use the picturesque expression employed by the Parliamentary Secretary to the Ministry of Labour.

What is the position of the shale oil industry today? Twenty thousand people, including workers and their dependants, are dependent on the industry for their livelihood. Although it is a combine or a company which is a subsidiary of a huge combine, there is still a family atmosphere in the industry. The people engaged in it work together and understand each other's points of view and problems.

The workers in the industry are in the dilemma that they have to refrain from pressing their perfectly reasonable and long-overdue wages claim because they know that if it were granted it would mean that large sections of the industry would have to close down and that once again unemployment would be created in an industry which was particularly prone to unemployment in the inter-war years.

On 17th March last, a joint deputation was sent from the management and the trade union side of the industry to the Chancellor of the Exchequer. They were received by the Financial Secretary to the Treasury who listened to them with courtesy, as he always does, and who promised them careful consideration of their problems, as he always does. But no more has been heard of it.

Because the price of its products has fallen, the industry cannot hope to expand its production by initiative or in any other way. It is a rather expensive way of producing oil, and it is only through its by-products that the industry can keep going. However brilliant its management and however hard working its employees, there is no immediate way of expanding the industry. The only hope for its continued operation is some fiscal adjustment in taxation preference.

An increase in Excise preference is, as far as I can see, as far as the industry, and, I venture to suggest, as far as the Chancellor can see, the only hope of its being able to carry on. One of the problems which have to be considered when we have an indigenous industry of this kind is whether we can afford to allow it to close down with all the suffering that would involve for the 20,000 people dependent on it.

It would be a very great loss to Scotland if this industry were to go out of being. I am sorry to have to introduce another rather sombre note after the speech of the noble Lady the Member for Aberdeen, South, who sees danger to her own fishing industry in present circumstances, but I see a very real danger to the shale oil industry. There are still great deposits of shale under the soil with which the industry could deal to the benefit of Scotland's long-term economy.

I now wish to speak about the industry, employment and well-being of the port of Bo'ness, which was once one of the most important ports on the Firth of Forth. But for some years since the inter-war period, its activities have been steadily slowing down until its present position is causing very justified alarm among the shipping agents and the workers at the port.

It is in an endeavour to prevent its further decline and, if possible, to assist the revival of this port that I venture to raise the subject on the Floor of this House. Having tried every other avenue open to a Member of Parliament and having encountered nothing but resistance from those in a position to determine the port's future, I believe it to be my duty to lay the facts before the Committee and to ask for a reversal of the present policy adopted towards the port.

It is always advisable in this Chamber to avoid over-statement of the case and much more wise to use the language of under-statement. Were I to disregard that dictum, I would say that there is clear evidence that the port of Bo'ness is being sabotaged and sacrificed as part of a deliberate policy. However strong the temptation—and the provocation—I will refrain from such language, because my purpose is not to antagonise those in control, but to endeavour to secure their cooperation and to persuade them that there is really a strong case to be made for Bo'ness, and that it would be a mistake to let this useful port silt up and decay in desuetude.

It is a useful little port and can take ships drawing from 15 to 22 feet according to the time of the month and the state of the tide. It is conveniently situated on the south side of the Firth of Forth, which is an eastern estuary of growing importance, not only because of the development of the coalfield in the Lothians, but for strategic reasons. Although its equipment could not be called modern even by its most enthusiastic supporter, it is nevertheless reasonably efficient. Indeed, I have seen worse equipment on more modern docks.

I will say a few words about its coal-shipping equipment, because this is really the crux of its problem. Its coal-shipping equipment consists of three hoists called Nos. 1, 3 and 4. I believe that No. 1 hoist is higher than any other in any Forth port. It is certainly higher than most, and can tip the wagons farther, and, being served by five sidings with two turntables, it is capable of a very fast rate of shipment. The advantage of five workable sidings is in "mixing" up to five brands of coal. This mixing and loading can be carried out without locomotive power. This is a special advantage when loading has to be done outside the normal engine-working hours.

The other hoists, Nos. 3 and 4, are fitted with weighbridges and are situated close together. Thus they can be worked together, fore and aft, on suitable ships for simultaneous loading. The fact that they are seldom used nowadays is a sad commentary on the state of trade in the port. Anyone with a knowledge of port and dock operating will understand that No. 1 hoist, with its two turntables, is that which the ship agents prefer to use. The value of the hoist to the port is very considerable, yet this is just the very hoist which is being threatened by the present policy of the East of Scotland Section of the Docks and Inland Waterway Executive who have intimated, have almost declared finally, that they propose to remove one of the turntables from this hoist.

This may seem a small thing about which to take up the time of the Committee, but it is like the Forth road bridge in a smaller way—it is a symbol. If the turntable is removed, the effectiveness and efficiency of the whole of the port of Bo'ness become things of the past. Therefore, I speak about these matters in this detail, and with some feeling. The efficiency of this hoist as a swift-loading multi-mixing machine is at once ruined if this equipment goes, and it will be not only a very severe blow to the port but a great discouragement to the shipping agents who are struggling against many other obstacles to rebuild the trade of the port. It will be an additional blow to the already attenuated labour force in the port. It is proposed to remove the turntable to Grangemouth, and this, to Bo'ness, is the most unkindest cut of all. Grangemouth is Scotland's boom town. The development of a huge oil refinery has placed the town in the over-employed category. In certain groups of industry there are rather more jobs than there are men readily available. Grangemouth docks share in the general increase in activity which has been proceeding in that town since the end of the war.

I can assure my hon. Friend the Member for Stirling and Falkirk Burghs (Mr. Malcolm MacPherson) that we in Bo'ness do not grudge Grangemouth her prosperity. We admit freely that Grangemouth has better rail facilities to the west than we can possibly have at Bo'ness because of the terrain, but it is indeed galling to see the eastward trade items on which the port trade of Bo'ness grew and flourished in the past taken away from us. We believe that we can handle coal and timber traffic better in Bo'ness than they can in Grangemouth. We have better facilities—at least, we have good facilities—for general trade. There is no tenable argument for over-concentration of Forth trade into one port. There is a very sound argument for dispersal and for fair shares of existing traffic of a suitable nature.

There is another important factor. Bo'ness is an under-employed town. One of its two collieries, the Carriden pit, is in steady decline, while the other, the Kiniel pit, is being substantially developed, but the technical problems attending its development are formidable and will take some time. It is an undersea pit. Its equipment has to be housed on a narrow shelf of land because of the steeply rising hills at the back of the pit. During the interim period, while this pit is being developed, there is inevitably a state of trade hiatus, a semi-depression, in the town. Anything we can do to prevent its deepening is our plain and obvious duty.

With these considerations in mind, it is really a bit thick to be confronted with a process of trade strangulation, deliberate and calculated, in an unemployment-prone area to improve facilities in an employment-prone area. Let Grangemouth have its turntable by all means, but not at the expense of Bo'ness, which is already hanging on by its fingernails to the remnants of a once-flourishing trade. With all the resources of the Docks and Inland Waterways Executive, and the whole of the area under their survey, they can surely find another turntable to transfer. In any case the manufacturers of turntables have not stopped manufacturing them. There is no reason why they should pinch or purloin ours. This is a relatively small thing, but it means much to the trade of Bo'ness. It would make little difference to the trade of Grangemouth.

The East of Scotland Section of the Executive will listen to no reason. They have made their decision. The British Transport Commission have been appealed to in vain. Our last hope lies with the Minister of Transport, whose representative is not here tonight, and with the Secretary of State for Scotland. Between them, those two gentlemen have the over-riding authority. Their right hon. Friends the Minister of Labour and the Minister of Fuel and Power should also have some interest in the matter. Their intervention will be very useful.

It may be the intention and the policy deliberately to allow this port to die. I stood at the dock gates the other morning and looked at the gradual silting up because of lack of dredging. As an ex-docker—although it is many years since I handled a hook—it was a very sad sight to see the empty docks and the silting up approach to the dock gates and a derelict dredger, unseaworthy, rotting away inside the dock. So far as I can ascertain, no dredging took place last winter in Bo'ness port at all. I doubt whether any has taken place since.

It may again be that it has been decided that this port is expendable and can be closed down. If that is so, let us know. Give it to us straight on the chin so that we know what is in front of us. Do not let us have this "death of the thousand cuts" taking away our best and more valuable equipment and neglecting to do essential dredging. This is a cat-and-mouse policy which is depressing and gives much uncertainty and anxiety to the people of the town.

As a port, Bo'ness has survived many body blows in the past. They rained so heavily in the inter-war years that Bo'ness was almost on its knees, when it was saved by the bell of the outbreak of war. During the war Bo'ness was, significantly, used by the Admiralty. Since the war it has struggled along doggedly, but there are limits to patience and endurance. There is one ray of hope. I believe that it has been decided to agree to a capital expenditure of £20,000 for the electrification of the power plant that serves the docks. That is a hopeful sign. If, on top of that hope, we can have our turntable left alone, and if we can have the dredging attended to as it ought to be attended to, this port can take its place again as a potentially valuable national asset, as every one of our usable Scottish harbours is. Our strength will not have been lessened by the demise of this useful port.

The first step in its rehabilitation is for the Minister to see that the Docks and Inland Waterways Executive realise, in their quite understandable anxiety to show no red figures on their balance sheet, that they really have another responsibility to the nation. It is not the primary business of nationalised industries to show balances. Their primary responsibility—this applies particularly in Scotland—is to serve the nation and its people efficiently and well. For the sake of the expenditure of a few thousands, we can save this valuable port.

I feel rather guilty about detaining the Committee on a purely constituency point when so many hon. Members wish to speak, but because it is to me and to my constituents important and because I believe it to be symbolical I feel justified in making it.

We gave some problems to the learned Clerks at the Table in the number of Votes we put down for this debate. It was because of our anxiety that hon. Members should be allowed to range over the whole field of Scottish endeavour and Scottish potentiality. I believe we have succeeded in the debate as it has gone hitherto, and I believe that the debate has been wholly and fully justified. I am sorry that as yet we have not had any indication from the Government, except for patching up here and propping up there, of any clear, imaginative and forward-looking, effective policy for Scotland's future.

The Government's spokesmen have been helpful and have shown anxiety at the existing problems and it may be that the excellent suggestions which so far have come from both sides of the Committee in this debate will give them encouragement and ideas. I am sure that the suggestions will help them to understand why we who represent Scotland are not coming here in any querulous spirit asking for a hand-out. We come here believing that there is a future for our country to be attained by our own firm endeavours.

6.22 p.m.

Mr. John Maclay (Renfrew, West)

The Committee has undoubtedly enjoyed, among other things during this debate, listening to a Whip restraining his language. That has been a most delightful experience, but when the hon. Member for West Lothian (Mr. J. Taylor) went on to exercise his full powers of persuasion on behalf of the entirely admirable port of Bo'ness we understood that, even if English Members do not always keep the figures right, no Scottish Labour Member would fail to do his duty when encouraged in such a persuasive way by his Whip.

In opening today's debate the hon. and learned Member for Paisley (Mr. D. Johnston) paid a tribute of respect and admiration to the Secretary of State for Scotland but said that he felt there had not been sufficient drive. I believe that that was the general implication of his remarks. That surely was unreasonable, coming at this moment when only in the last two weeks the Secretary of State has delivered to us on a plate about £1,750,000 in additional local government grant and yesterday brought in another £1 million for much-needed road work. If that is negative work, the positive must be very exciting indeed.

At the moment we are getting leadership in Scotland from the Scottish Office. I am not making any party point here. The structure that has been evolved, with a Secretary of State, a Minister of State for Scotland and three Joint Under-Secretaries of State, as everyone will agree, is making possible much more effective work by each individual than their predecessors could do. It was no fault of their predecessors. As we all know, the load on the Scottish Office and on the Minister was terrific in the past. There is now a feeling in Scotland, which I sense in my own constituency, that there is a drive and direction from the Scottish Office that has not been possible in the past.

As we did yesterday, we have covered again in today's debate a very large number of subjects. It is very desirable that there should be such a number of Votes on the Order Paper, and the fact that so many Ministers are present is a tribute to the attention now being paid to Scottish needs. It is right that this concentration should take place this year, because undoubtedly we have reached a turning point in the whole industrial trend of the country. I do not see how it can be avoided.

In the eight years since the war we have had a sellers' market. We have had the fact that, until quite recently, if a factory was available one could secure a tenant for it. The conditions which prevailed from the end of the war until recently were ideal conditions for doing controlled experiments in the distribution of industry throughout the country. It is right at the moment to assess what has happened and from that assessment to draw certain conclusions for the future in Scotland.

I do not propose to go into great detail. This is a subject that requires a great deal of time, and in reaching my conclusions and stating them to the Committee I must leave out some steps only because, as I hope hon. Members will believe, of a wish to condense my argument. The first thing that emerges from a study of the last eight years in Scotland is that despite all the attractions of the great industrial centres and the fact of their being Development Areas, the trend of population has been slightly away from those areas.

Yesterday the right hon. Gentleman the Member for East Stirlingshire (Mr. Woodburn) implied that the flow into the big cities was still continuing. I thought so, too, until the last few weeks when I studied this question. It is made apparent in the Cairncross Report that in the last 20 years the population of Lanarkshire—including Glasgow—Renfrewshire and Dunbartonshire has increased by 4 per cent., whilst the population of the rest of Scotland has increased by 6 per cent. It is not a big figure, but the trend is there. It is an important piece of background, in thinking of the future, that probably the great drift to the great cities is stopping, provided that we do something to see that people are not encouraged to start that drift again when things get a little more difficult.

That is the first important factor. The next is that the Distribution of Industry Act has been a very important element in the siting of industry in Scotland. Great advantage has been taken of it. Figures for the period 1946–1950 show that out of 281 factories only 53 were built by private capital, as against 228 under that Act. That means that the Distribution of Industry Act has had a very substantial effect on the location of industry. The President of the Board of Trade said many things in his opening speech with which I agreed, and I particularly agreed with him when he said that ultimately Scottish enterprise had made and would continue to make Scotland great. Nevertheless, it is a fact that the Distribution of Industry Act has had great influence in the past few years, but I would suggest that it is doubtful whether that influence will be as great in the near future. The impetus is slowing down, for all sorts of obvious reasons.

Another factor is that there is still a somewhat higher level of employment in the Development Areas than outside, except for certain pockets. But there are also within the Development Areas several small pockets where the percentage of unemployment is much higher than is the general average. I have one such pocket in my own constituency.

The third really interesting point that emerges from all the documents and reports that are now available, and which are very valuable, is that outside firms, the non-Scottish firms, have gone almost exclusively to the Development Areas, that is, to the great industrial belts. It is the Scottish firms that have been enterprising outside. That is a very important and very encouraging fact. The figures are significant. While for every one factory that non-Scottish firms have started outside the big, major, industrial areas they have had 13 inside, the comparable figures for Scottish firms is about one to five. That means that, in spite of the advantages which were to be gained from using the Distribution of Industry Act procedure, Scottish enterprise has been going strong outside the Development Areas. That is important when we come to think of What is to happen in the future.

We can be certain that there is no lack of enterprise in Scotland at the moment outside the great industrial belt, provided it is made reasonably possible for enterprise to express itself. I am sorry that the hon. Member for West Stirlingshire (Mr. Balfour) is not here because he made a most interesting maiden speech yesterday, and I wanted to congratulate him on it. I have a fellow feeling for him, because I made my maiden speech after I had been a Member for four years and nine months. By a strange coincidence, my subject was exactly the same as his.

I was arguing in 1945, before the end of the Coalition Government, that there was a danger of the Distribution of Industry Act placing overmuch emphasis on the old distressed areas, and I stressed the importance of the old Scottish towns which were an ideal sort of community capable of expansion with much greater ease. I remember only too well what happened. I moved an Amendment in Committee upstairs, which would have produced rather more assistance outside the distressed areas than the distribution of Industry Act promised. Clearly the whole feeling of the Committee was with me. The right hon. Member for Bishop Auckland (Mr. Dalton) was conducting affairs, being the Minister concerned. He said he would consider what had happened in the Committee, and at that point the Coalition dissolved.

The same argument applies today as applied then. We still need the Distribution of Industry Act in the Development Areas, but I suggest that while we must continue to use the special facilities given by the Act—my own constituency has reason to be thankful for these facilities— I do not think much more can be done in these areas. The rate of new factory arrivals has slowed right down and we must recognise that the really effective period of that Act, for the time being, is probably over and we may be able to release the resources of the Act into areas outside the Development Areas.

Dealing for a moment with one of the pockets of heavy unemployment inside the Development Areas, I have analysed very carefully one of them, and I wonder how much of what I found applies to those parts of the industrial areas where the figures are abnormal. I found a case where there are 800 unemployed—400 male and 400 female. Of the 400 women, a very large proportion were married. As to the men, I will not accept this word "unemployable" which is often used; I do not think there are a lot of unemployables. There are, however, people for whom the ordinary industrial development is not suitable.

I suggest there is a case for a very selective examination of pockets of unemployment, and where it is found that they do not constitute the type of labour which would benefit from another light industry, we should begin to apply some of these devices which were forecast in the 1944 White Paper on unemployment policy. I do not mean that we should adopt the whole Keynesian business to deal with one small town, but there may be a case for letting a town go ahead with, say, parks development or some kind of localised work, which will pick up the type of labour which is represented in the unemployment figures.

I should like to pass quickly to the rest of Scotland other than the remote districts. There is no doubt that there is initiative there. The President of the Board of Trade and others have been inclined to think that a good going proposition will get capital and will be able to make progress. I think that is probably right, but there are a lot of marginal cases where a new industry could be established with local interests.

The hon. and learned Member for Paisley (Mr. D. Johnston), in his interesting speech, dealt particularly with this question, and while I do not agree with everything he said, I believe there is a great deal in it which requires examination. The hon. Member for Aberdeen, South (Lady Tweedsmuir) also made an excellent speech on this subject. Are we sure that it is as easy as it is sometimes made out for a good industrialist to get the buildings and the capital with which to start when he gets away from the Development Areas? I would expand on that, but I want to conclude as soon as I can. One could ask a whole string of questions, but probably I had better not do so on this occasion.

I come finally to the question of transport costs. This is the ideal moment to get that question thrashed out. There are two things happening. We hope that we shall know very shortly what will be the structure of railway and transport control generally in Scotland. According to what we have been told, it is clear that there will be substantial powers in some body in Scotland for considering the special transport requirement of Scotland.

But there is a more important question than that which must be settled first, and that is the question of taper. Taper is a principle, and this is the moment for those who are acutely concerned to place their views before the Transport Commission so that the taper principle can be put specifically to the Transport Tribunal. If I understand the procedure, it is possible under the new Act, coupled with the procedure under the old Act, for the principle of taper to be referred to the Transport Tribunal as a matter of principle.

Clearly the Transport Commission cannot produce an effective charges scheme until that principle is established. My only hope is that it will be found that not enough attention has been paid in the past to the allocation of costs over long journeys. I think that if the question of taper is considered carefully with a view to using it to help to solve these problems of the remoter areas, we shall achieve more than any transport expert during recent years has ever admitted to be possible.

I am glad that the idea of the flat rate has been dropped. None of the Committees which have reported was enthusiastic about it. There are many dangers about the flat rate, whereas this idea of taper, if properly analysed, may go some distance to solving the transport problems, although it cannot affect places like the Outer Isles. We have undoubtedly got certain areas which are not capable of normal treatment. It is wrong to assume that there can be any general solution of the problem of the really remote areas. I think the most useful description of what is being done was contained in a speech made recently by the noble Lord the Minister of State for the Scottish Office. He based his speech on the theme of four roads to Highland prosperity, and I believe it indicated the basis of what can be done in these more difficult areas.

We should forget the idea that it is possible to provide cheap transport to the Outer Isles. There is not the volume of traffic to do this. Neither is it right that the main transport system should be saddled with the task of subsidising these more difficult areas. What should happen is that if the Government decide that one area is losing population, they must make a special case and decide whether they will help that area as a community or whether they will help the existing industries by admittedly artificial means.

If we feel that by some natural process or general principle we can help in these remote areas, we are wrong. It must be admitted that it is extraordinarily difficult to get a living there now, but any development will have to be based on the existing natural resources. These areas will probably require quite special assistance. This is an ugly proposition to put forward, and I do not want to go into it in detail, but it is better to face that fact than to go on thinking that scheduling will solve the problem of these areas. Another possibility, of course, is that certain strategic industries might be placed in areas where they have not yet been put—even in the remoter areas.

I have tried to cover the three main categories of Scottish problems, based on our experience during the last eight years and the situation which we have now reached. In the long run, however, our prosperity depends upon our ability to pay our way in the world as a nation as a whole, and in Scotland as a whole. Clearly we are entering on a period of acute competition.

There is the question of shipbuilding, with which my hon. Friend the Member for Govan (Mr. J. N. Browne) dealt so admirably yesterday. Hon. Members have also been worried about the situation in our ports. In the long run the continued prosperity of our shipbuilding, and everything which depends on it, must rest firstly, on the quality of our ships, which we know is there; on delivery dates, closely related to the question of steel plate, which has already been dealt with by the hon. Member for Govan. But, above all, we are now entering a period when price is all-important. For a time delivery date was more important than price; today price is what really matters. We are up against intensive competition abroad. The yards building the bigger ships are in pretty good condition and will have full order books for the next few years, but this is a highly competitive business.

Management now realises that price is the important factor today, and will be increasingly important as months go by, and I believe that the men also know that. I hope and pray that in the next few months nobody will mislead any part of this great industry and cause it to take any action which results in prices rising still further, with a consequent fall in our competitive potential.

6.43 p.m.

Mr. Thomas Steele (Dunbartonshire, West)

I put it to the right hon. Member for Renfrew, West (Mr. Maclay) that although he is departing from the idea of flat-rate freight charges the effect of the tapered charge is just the same in principle. The railway service has to pay its way, and if there is a tapered charge the money has to be found somewhere else. I quite agree that the question of charges is important, but we have created a difficulty by denationalising long-distance road haulage transport.

It is quite clear that if we have any system which decreases the cost on long-distance haulage on the railways to help the areas in the North, additional cost must be borne by the traffic carried over the shorter distances, and it is that very traffic which is being attacked by the road haulage industry. I am convinced that we have taken a retrograde step in denationalising the road haulage industry, so far as helping these remote areas is concerned. The right hon. Member reminded us that he made a speech on this topic once before, and that the Government dissolved immediately afterwards. I am wondering if that is to be taken as a warning now, and whether we ought to prepare for the next Election.

I have listened with interest to the speeches of hon. Members opposite, and I think that the most misunderstood Member is the hon. Member for Govan (Mr. J. N. Browne). Yesterday, he made a speech which the President of the Board of Trade quite clearly misunderstood, as did the hon. Lady the Member for Aberdeen, South (Lady Tweedsmuir).

The hon. Lady's speech was astonishing. Never in my life have I heard an hon. Member make an attack upon his or her constituents in the way that the hon. Lady did today. I am sorry that she is not here. What she said is pertinent to my argument. She attacked her constituents for lack of enterprise and efficiency, and she based her speech on that argument, whereas the hon. Member for Govan made it quite clear that, having gone out of his way to find out the conditions under which industry would come to Peterhead and Buckie, he was of the opinion that, irrespective of the good things the President told us about Scotsmen, what is lacking is the necessary enterprise on the part of our own Scottish industrialists.

I must compliment the hon. Lady in getting out her hon. Friend the Member for East Aberdeenshire (Sir R. Boothby) at seven o'clock in the morning. She must have been up very early too, when she paid her call on the Civil Lord of the Admiralty. I understood that there was a scheme for the allocation of steel, but it may be that the hon. Lady has been able to overcome that. If I make an application to the Civil Lord I shall have to dress in a kilt. It is obvious that I could not go in a skirt.

In my own constituency, in the Vale of Leven, we have the Strathleven Estate, an industrial estate which was brought to this area and which has been of great assistance. Two of its factories have now been extended, but there is still a great area which can be developed. I should like to know what is the attitude of the Secretary of State or the Board of Trade towards further development in that industrial estate, which has all the necessary facilities.

The President of the Board of Trade said today that we had solved our balance of trade problems and various other things, but we have done so in my constituency at some expense. One of the first things that happened was that unemployment occurred in the Vale of Leven, particularly in the United Turkey Red Company, which is the biggest dyeing firm in the whole of Britain. Even Lancashire has not got a firm of that size.

I should like to take hon. and right hon. Gentlemen who sit on the Front Bench opposite on a motor coach tour of my constituency, round the three lochs. I am sorry that no representative from the Ministry of Transport is here. There has not been one during the whole of the debate, although the question of transport has been mentioned fairly frequently. This tour of the three lochs is probably the most popular motor coach tour in Scotland, but the condition of the road round Loch Lomond is a scandal. It is very narrow and very dangerous. It is just the same round Arrochar, down to Loch Long and over to the Gare Loch.

We have the lovely Loch Lomond, which is known throughout the world as one of the attractions of Scotland, and we have a road which, quite candidly, causes anyone who is driving along it to miss the beauties of the loch. Sometimes it is shaded with trees, the driver certainly cannot take his eyes off the road, and most of the people with him are so excited about the dangerous nature of the road that they cannot possibly appreciate the beauty of the loch. We ought to do something about the roads around Loch Lomond, and in the area right round to Gare Loch.

Having got to Gare Loch, I would put this to the Government: Here is an area in which the Government took advantage during the war. We have the Navy there, and they are very welcome. We have the Army, who have some very unsightly buildings on the shores of the Gare Loch. Along came the Post Office, and they, too, put up some buildings. As the Secretary of State and the Under-Secretary of State know, other developments are due to take place in this area.

Here, in the Gare Loch, on the west coast of Scotland, we have a fine port in which deep sea vessels can be berthed. If we are to develop that area, let us say so. Let the Secretary of State, who is in charge of town planning and of so many other things, get down to the question of what is to happen there, because what has been happening has been piecemeal development which is making the place very ugly indeed. It is natural that the inhabitants around that lovely district are worried about what is to happen. It is true that we could have greater development in the Vale of Leven. It is true that we could develop the Gare Loch as a deep sea port and could have a route into the Vale of Leven to go to Stirling, in the north, without touching Glasgow at all. That may be the future of the Gare Loch. I do not know. What we cannot have is this piecemeal development which is making the district so ugly and causing the inhabitants so much worry.

The Government must make up their minds. Either they must say that we will retain this place because of its beauty and use it as a place to which people can go to see its beauty—use it for the tourist industry; or they must say that it will be used for the development of a deep sea port. The Government must make up their minds and take some action so that the inhabitants know what is to happen.

I want to try to create a record by making the shortest speech in the debate, because if all those who wish to speak are to be fortunate enough to do so we must keep our speeches short. I therefore confine mine to this point about the Gare Loch. I hope that the Government will be willing to do something about it

6.53 p.m.

Lieut.-Commander Clark Hutchison (Edinburgh, West)

I should like to follow the hon. Member for Dumbartonshire, West (Mr. Steele) in seeking to make a short speech, for I know that a considerable number of my fellow countrymen also wish to speak. It is true that the Votes put down for discussion today allow us to range over a very wide field, covering the whole of the White Paper on Industry and Employment in Scotland, but I intend to confine my remarks to two practical matters under Part III of the Report—that which is appropriately headed "Basic Services" and which deals, in the first place, with transport and communications and, later, with electricity.

Although I represent one of the divisions of Edinburgh, I know the North very well indeed, and I welcome most wholeheartedly the announcement made by my right hon. Friend the Secretary of State yesterday about the expenditure of a further £1 million during the next three years on the improvement of roads in the northern part of the country.

My right hon. and gallant Friend the Member for Glasgow, Kelvingrove (Lieut.-Colonel Elliot) referred to a traffic problem when he mentioned the Clyde tunnel, and I realise that there is a very serious traffic congestion problem in Glasgow, but some of my colleagues in the east of Scotland will agree with me when I say we also have an acute traffic problem across the Firth of Forth at present. It is referred to briefly and indirectly in paragraph 254 of the White Paper.

To put it mildly, the bottlenecks which develop at the Queensferry passage at present are very disturbing. I believe that the only thoroughly effective solution is the construction of a road bridge at Queensferry, whether it be built from funds from public sources or funds raised privately. I have held that view for many years and spoken of it here on many occasions, for example, during the passage of the Trunk Roads Act, 1946, and on the Adjournment last November.

I have no need to argue the case for the bridge, which has been put forward on very many occasions. On broad economic grounds it can be said that if it were there it would help very much in developing trade and industry in Fife and the Lothians and, indeed, over a wide field of Scotland. It would also be of considerable strategic value to the country.

Since this matter was last discussed in the House, there have been two important conferences, one in London and one in Edinburgh, between Ministers, Scottish Members, local authority representatives and members of the Forth Road Bridge Joint Committee. The various facts and figures have been discussed at those conferences. Frankly, I am disappointed that it has not yet been possible for the Government to indicate when the constructional work will start, particularly as the expenditure estimated for the first three or four years is relatively small.

Listening to those discussions on the statistics of potential traffic which might use the bridge, it seems to me that there is a considerable difference between the figures put forward by the promoters of the road bridge project, on the one hand, and those put forward by the Ministry of Transport, on the other hand. I suggest to my right hon. Friend—and I think it is an entirely reasonable suggestion—that there should be a further examination of these figures. I feel sure that if this matter is put to the Minister of Trans port he will have another look at it, because the Government must appreciate, as other hon. Members have said, that there is considerable feeling on the subject in Scotland. It is essential that all the evidence and statistics should be carefully checked.

The problem of the bridge is not our only worry because even if, happily, building could be started forthwith, I understand that it would be some eight to ten years before the bridge could be opened for traffic. That is a very long time to wait, from the road transport point of view, and, meanwhile, there is great and growing congestion on both sides of the Queensferry. Those who are interested in the matter know that since the closure of the Granton-Burntisland ferry, just before Christmas, that congestion has been aggravated, because a number of heavy vehicles which were in the habit of using that Granton-Burntisland ferry are being diverted to Queensferry. The presence of these heavy vehicles has prevented a great many lighter vehicles from going over in the ships which ply between North and South Queensferry.

There are some people who doubt the wisdom of improving the ferry service and feel that by doing so we may delay the building of the bridge. I have thought about this carefully, but I believe that it is a risk which must be accepted, because it is important that we should get a greater freedom of traffic between the two sides of the Forth estuary. I hope that when the President of the Board of Trade visits Scotland next month he will adopt your suggestion. Major Anstruther-Gray, and try to cross the ferry at the peak period. I observe from his itinerary that he is likely to be crossing on 11th August. I hope he will choose to cross between 5 and 6 p.m. If he does, his experience will bear out my contention that something must be done to improve that service. I am not altogether pessimistic about this improvement, because I notice from the answer given by the Parliamentary Secretary to the Ministry of Transport to a Question last week that the British Transport Commission have been asked to prepare final estimates for the improvement of the Queensferry.

I would add one word on this point to the Minister of Transport, and perhaps the Under-Secretary will pass this on to him. I hope that the Minister will not hesitate to prod the British Transport Commission, in making them do their job and improve this ferry service, because I have a feeling, which is based on some personal correspondence—

Mr. Woodburn

On a point of order. It seems that a great deal of this debate affects the Vote of the Minister of Transport. It is down on the Order Paper. So far, I think, we have not had the Minister or the Parliamentary Secretary present, which seems to be a great discourtesy to the Committee.

The Temporary Chairman

I do not think that that affects the Chair. The Ministry of Transport Vote is on the Paper. Therefore, it is in order to discuss it.

Lieut.-Commander Hutchison

In fairness to the Minister and the Parliamentary Secretary, and in answer to the right hon. Member for East Stirlingshire (Mr. Woodburn), I would point out that the Parliamentary Secretary was present for a period. [HON. MEMBERS: "When?"] Yesterday. Anyhow, the information can be passed on to him. He has taken some steps about this, and I am merely hoping that he will prod the British Transport Commission about it. Recently, I have had some correspondence on this subject, and I feel that there is some inertia which must be overcome. I think that useful improvements can be made at a relatively small cost, at something like £500,000, judging by some plans which I have seen. I would reiterate that a better ferry service will not be much of a substitute for a bridge, but it will at least be what we call in Scotland a "pit by."

I turn to the other matter to which I referred at the beginning of my speech, and that is electricity, and in particular, the supply of electricity to industrial consumers in South-East Scotland. The Vote of the Minister of Fuel and Power is down for discussion today and the Parliamentary Secretary was here not long ago. I should like to draw the attention of the Minister, and also that of the Minister of Labour and the attention of the Secretary of State, to a most unfortunate development which appears to be taking place in the South-Eastern area, and one which is likely to have a disturbing effect on production and employment in the Edinburgh, Lothians and the Border district.

The South-East Scotland Electricity Board recently introduced a new commercial tariff for the supply of electricity to industrial firms, and this has led in a number of cases to very heavy increases in the charges. In the case of one firm, of which I have been given particulars that have been verified with the Board, these charges amount to an increase of 120 per cent., while another firm informs me that the increased charges will probably lead to the closure of part of their works—this is an engineering business—with a consequent increase in unemployment.

I shall not develop this matter any further tonight, because I am in correspondence with various Ministries and with the Electricity Board about it, but it is a very serious matter and one of which we should take notice when we are discussing the whole subject of industry and employment in Scotland. Indeed, I say that it emphasises very much the wisdom of the policy of the party to which I belong, which is that the generation and the distribution of electricity in the Lowlands as well as in the North should come under the jurisdiction of the Secretary of State for Scotland, who can then keep a watchful eye on all developments. I therefore end by saying that I hope that the reference to this matter in the Gracious Speech will be translated into legislative action next Session.

7.4 p.m.

Mr. J. Grimond (Orkney and Shetland)

I, too, propose to be short, and so, if he will excuse me, I shall not follow the hon. and gallant Gentleman the Member for Edinburgh, West (Lieut.-Commander Hutchison), though I know, Major Anstruther-Gray, that this question of transport across the Forth must be one very dear to your heart. I am afraid that I cannot agree with the happy view which the right hon. Gentleman the Member for Renfrew, West (Mr. Maclay) takes of the Scottish Office. The appointment of a Minister of State for Scotland and an extra Under-Secretary of State has not gone near satisfying the demand in Scotland for special attention to our problems, and for powers to tackle them ourselves. As regards the Highlands the speeches of the Minister of State have been too optimistic. I have a great admiration for him, but I am sure that if the Government inquired even of their own supporters they would find that in the Highland areas there is wide uneasiness about the state of affairs in the far North.

It has been said that the Secretary of State has come forward with a promise of £3 million for Scotland, but I do not think that that is a very large amount considering that very little has been provided during the last few years, and certainly, compared with the amount we have been prepared to spend in London on the Coronation, and the £140,000 spent on Lancaster House for re-decoration, it is not a large amount at all. It is said that we get our fair share of transport grants, but when the figures are argued it turns out that we only get them because the three major improvements in England are deducted from the computation before it is made.

There were two things announced yesterday. There was the announcement that there is to be a plant for the processing of peat at Altnabreac. I must say that the Secretary of State might have been a little more cheerful about that. When he began his announcement I thought there had been another national disaster. In point of fact, I think it is very encouraging for the Highlands. It may have a direct effect only locally, but nevertheless I think everybody in the Highlands will rejoice that something is going to be done, and I think it will give a great deal of satisfaction and encouragement all over the Highland area.

Then there is some assistance for roads. What is proposed, as far as it goes, I heartily welcome. It is something. But I do not think it goes very far, by contrast with what is needed in the Highlands to give us a decent road system. There are certain questions I would ask about this. I should like to know if this £1 million is in addition to the £750,000 promised by the late Labour Government, the balance of which is still unexpended. Are we to take it that we get the balance of that sum as well? Secondly, is this new sum in addition to the normal routine grants? Thirdly, is it in addition to the Crofter County scheme agreed before the war? I should like confirmation on all these points, and some information whether it is for the repair of roads or the reconstruction of roads, or what it is for. Is it, for instance, available for by-roads, which are most important in the Highland area?

Apart from this, the Government are still relying on committees and legislation that date from the time of their predecessors. I do not think that in their tenure of office they have given us any new development so far as the Highlands are concerned. Some of this old legislation, in my view, has been good, and some not so good, and some has failed. I do urge the Government to look at this legislation to see if it meets the special needs of the Highland area, and, after two years' experience, to try to bring it up to date. The Scottish Office cannot be satisfied with the present state of affairs in face of the continuing unemployment and depopulation in the North. There are many special problms which must be tackled. There is the question of freights. Some very pointed questions were asked by the noble Lady the Member for Aberdeen South (Lady Tweedsmuir). Some excellent suggestions have been made to the Government by the right hon. Gentleman the Member for Renfrew, West. Are the Government going to carry through these improvements? Up to now, when questions have been asked, we have usually got the answer that we must wait until the British Transport Commission have drawn up their plans, but I do not think that that is necessary.

At the moment the Government are subsidising shipping services in the Western Isles, and there are areas, such as my own constituency, for instance, which cannot be affected by any scheme drawn up by the British Transport Commission. I agree with the right hon. Gentleman that the question of freight charges is a national social question, and it is not fair to leave all these decisions to the transport authorities. It is a matter upon which the Government must make up their mind whether or not it is worth while helping those areas. Unless we get help we are not going to be able to develop our fishing or our agriculture or attract industry. This is at the root of the whole matter.

Then take the question of land development, which was recently debated.

Sir R. Boothby

The hon. Gentleman will agree that these charges should come from Exchequer grants and not be made by the railways and others.

Mr. Grimond

I quite agree. On the question of land development it is no good waiting on all subjects for the Crofters Commission. There are many questions concerning land development which will have to be decided by the Government. I want to see experiments carried out on the mixing of crofting and allied light industry to see if it will yield a decent livelihood.

In all these matters we want what I would call a touch of Tom Johnston in the Scottish Office and the welding together of private and public enterprise. In many parts of the North of Scotland today there is a feeling that what is wanted is a coherent, well-considered policy which the Scottish Office will drive through if necessary in the teeth of other Ministers.

Let us look at fishing. The noble Lady the Member for Aberdeen, South put some very important questions about the state of the fishing industry in Scotland. There are many of these questions that still want an answer. I have no doubt that if the hon. Member for Banff (Mr. Duthie) speaks, he will draw attention to new methods of catching. Are the Herring Industry Board and the White Fish Authority examining how the share fishermen can take advantage of the new methods? Are they in touch with the new development in the processing of fish and the production of oil from fish for human consumption? In my own constituency the Russians have taken to coming with a fishing fleet to the North of Shetland. I cannot get out of the Scottish Office whether they have been in touch with them and whether they know what they are catching or how they are catching fish. I do not believe that they are going there without catching something. Why cannot the Scottish Office, if necessary through the White Fish Authority, find out what they are after?

In general, if we are to get value for the money we spend in the North of Scotland we have to have a comprehensive policy which must be supervised in its execution by one ministry, and that is the Scottish Office. I agree with the President of the Board of Trade that the future of Scotland is not going to depend on his detailed regulations with regard to Development Areas, and so on. It is going to depend on wider things. But I would say to him that when it comes to individual places like Wick and Lerwick and individual areas like the Moray Firth, it is of some importance that the small manufacturers do know about the Export Credit Guarantee Scheme. It may be of great importance to Wick or Lerwick whether it is made a Development Area or not and whether adequate transport services are provided. The co-ordination of detailed assistance and its special application in various areas is a matter for the Scottish Office primarily to press on other departments of the Government. I think that it is the desire of everyone in this debate to get behind the Scottish Office and to push them on.

The question of rural depopulation has been going on for some time. What information are we getting from other countries, such as Norway, about this? It is far better on this sort of question to look to Norway than to Lancashire, because the Highlands are more like Norway. Are we finding out what happens in the Dominions where they, too, suffer from long transport hauls?

Lastly, I would draw attention to the point made by the hon. and learned Member for Paisley (Mr. D. Johnston) who opened the debate today on the subject of Scottish trust companies. The President of the Board of Trade rightly said that we could not expect people to invest money locally today because they did not get a fair return for the risks involved. If they can channel their money through an investment trust they can spread the risk. I want to see those trusts helping local industries. But am I right in saying that the investment trusts are not allowed to raise a new ordinary capital? I think that they should be encouraged to do so and invest a proportion of their funds in Scotland. I believe that this is a useful method of encouraging savings and could be a useful form of private enterprise investment which hon. Members on both sides of the Committee want to see.

7.15 pm.

Mr. R. Brooman-White (Rutherglen)

I shall endeavour to follow the precedent of being as brief as I can. I hope, therefore, that the hon. Member for Orkney and Shetland (Mr. Grimond) will forgive me if I do not follow him in the very wide and far-reaching issues which he has raised. I am in some difficulty because the points with which I want to deal specifically follow the ones made by the right hon. Gentleman the Member for Renfrew, West (Mr. Maclay) and raise the general problem of distribution of industry policy, which is a very complex subject to deal with in a short time. I can only try to be as lucid as I can, and I hope as clear as he was in his approach to this problem.

The general tenor of the debate has shown agreement on the limitations of the Government's powers in this respect and the limitations of what we can hope to achieve through distribution of industry policy. I need not go back over the ground covered by the President of the Board of Trade in his opening remark in which he spoke of "elementary fundamentals." In particular, if there is any general trade recession it can only to a very slight degree be countered by these means. We will in the main have to rely on the ideas of Professor Keynes and the proposals of the 1944 White Paper on Employment.

The right hon. Member for Renfrew, West made an interesting suggestion that some of these measures might be applied locally and to a limited extent, in certain areas where there are pools of unemployment today. If one is going to move from the very small to the medium-sized application of such an idea the thought arises that there is still a relatively large pool of unemployment in Glasgow, and on that basis the argument for the Clyde tunnel is seen in its correct proportions against that for the Forth bridge.

Sir W. Darling

What does the hon. Member mean when he speaks of getting the Clyde tunnel in correct proportion with the Forth bridge?

Mr. Brooman-White

Seen from the western part of the country, the Clyde tunnel appears considerably more important.

On the general considerations before us the level of unemployment in Scotland is now relatively low—2.7 per cent. There are certain pools of heavier unemployment; and at the same time the general level of the new industries starting up is declining. There may have been some small improvement latterly, but in general the post-war effervescence has died down. What is the correct policy at the moment in these circumstances? The right hon. Member for Renfrew, West like myself, represents a constituency in a Development Area, but in common with him I feel that we should go a little further beyond the present policy. The prosperity of the Development Areas will in the long term be decided by the prosperity of the country as a whole, and at the moment I think that there is something to be said for even greater flexibility than was intimated in the remarks of the President of the Board of Trade.

I would not regard myself as being in any way illogical at a later stage if there were a recurrence of industrial difficulties and I then pleaded as forcibly as I could for special consideration for the Development Areas. But I think that at the present moment we should place at least as much emphasis on tonic measures as on palliative measures. We should take steps to stimulate growth as being at least as important as steps to arrest decay. In places like Glasgow, where there are still relatively large pools of unemployment, it is clear that what can be done by way of distribution of industry at the moment is very limited indeed. We cannot seriously expect new firms to come in which will make a very appreciable reduction in unemployment. And at the same time, the work those firms may offer to certain categories of labour unemployed at present will create a complication in increasing the demand for skilled labour of which there is a shortage, and that demand may be pressed to the disadvantage of employment in the firms already operating in the area.

The Scottish Council have therefore argued, and many people agree, that there is a strong case for being specially selective in the Development Areas, at the moment and for being as encouraging as possible in the growing areas. In being specially selective, we want to stress the importance of the newest types of industry. The right hon. Gentleman the Member for East Stirlingshire (Mr. Woodburn) mentioned Ferranti's and the special measures taken to bring a Government research centre to East Kilbride. We should concentrate attention very much on the newest types of industry, the Boffin industries, which may at the moment employ only two or three men with slide rules and a few lady typists, but which are building up a nucleus of design and technical expertese around which the industrial skills of the old areas will regroup in the future as the pattern of industry changes.

We all agree with the remark of the Secretary of State yesterday that our limited resources must not be spread too widely. But it is a question not only of not spreading the jam too thinly today as he said; it is also a matter of ensuring sufficient jam tomorrow. We must encourage the type of industry which will put more on the shelf. To put it in other words: on 1st July the "Glasgow Herald" said: There is still a disposition to regard the relief of unemployment as the primary, even the sole, object of Government influence in the location of industry. … It is a question whether such thinking is compatible with the strategy still being formulated to guarantee stability to Scotland in the future. The latter requires that all available resources should be devoted to broadening the range of industry and employment, and is essentially an exercise in which 'stranger' firms connected with the new science based-industries must be encouraged to settle and the established firms best fitted to take advantage of technological advance be enabled to expand. In speaking of "all available resources" this puts it more strongly than I would have done, but I believe it is the direction in which we should be thinking and moving.

Professor Cairncross says in his Report: Most successful businesses start small, expand where they start, and only move elsewhere in special circumstances. That is a very cogent argument for catching them young. If we do not do so, we will fall into the same difficulties in the future as we had in the past, when we fell behind in the newer types of industrial development in the early decades of this century. The Ministry of Supply has done a great deal, and the Scottish Council has also done a great deal. I hope the Board of Trade will also use all measures at its disposal to ensure that this type of new development is carried from the laboratory into the practical field of industry at the earliest possible date to enable us to build up the cadre of new technical experience necessary for our future.

During the debate a number of practical and specific suggestions have been made. The right hon. Gentleman the Member for East Stirlingshire suggested a wider extension of Government contracts for small firms in outlying areas. The hon. and learned Member for Paisley (Mr. D. Johnston) spoke about financial difficulties and problems, and other hon. Members have touched on that subject. It is a most important point. I do not wish to follow the difficult and most interesting points which the hon. and learned Gentleman raised about risk capital investment companies and about the floating charge over assets, which affects agriculture as well as industry in Scotland. But to add weight to the point I should like to quote the 1952 survey of the Clydesdale and North of Scotland Bank Limited. Quoting the chairman of the Scottish Council, the survey says: 'A great many individual companies find that the limitations on their ability to expand, or to undertake new development, are set by the amount of capital which they can find…' The survey goes on to agree with that, and says: To this we would venture to add one comment. Non-availability of finance, on acceptable terms, is not always sure evidence of the economic undesirability of a development project. … In short, where is the money coming from? Various suggestions have been made about risk-bearing capital. I wish to put one more specific point to the Minister. Is there at the moment any impediment to desirable types of development; or to development in desirable areas, in this matter of the availability of finance? As I understand it Treasury guidance to the banks is, broadly speaking, "If it is export or agriculture you are in: if it is anything else you are out." I do not know how strictly that is being exercised at the moment or whether it is now having any serious deterrent effect on the type of development which we need in Scotland. If it is having such an effect, is it not time that we ended the policy?

My hon. Friend the Member for Dumfries (Mr. N. Macpherson) yesterday made an interesting point when he spoke about differential taxation. That raises big, complicated issues, but I was interested because he spoke about the difficulties which the D scheme might impose on the new synthetic fabric "Ardil." Under the previous Government a taxation difficulty arose which resulted in a promising firm being driven out of my constituency because of the incidence of taxation on radio sets. I am not saying that in general it was not a sound tax at the time, but cannot we have more flexibility so that we do not discourage precisely these types of work on which our future rests?

To sum up my arguments, the Cairn-cross Report has pointed out that there is now a tendency for industry and population to spread more widely from the former great conglomerations. Surely that should be encouraged. And the more we can encourage such growth by natural means, rather than by the difficult and costly expedients of new towns, so much the better.

Secondly, our development of industry policy has up to now been a defensive one. It has consisted of trying to make good our deficiencies in the industries of which we failed to capture a proper proportion for Scotland at the turn of the century and a little later. We have been endeavouring to transplant them ever since; light engineering, the aeroplane industry and so on. Up to a point, we must continue to do so. But in our transplanting endeavours we must not lose sight of the need to bed out, in their early stages, the science-based industries on which development will turn in the next half-century. If we fail to do so, we will inevitably suffer during the years ahead precisely the same difficulties and disadvantages as we have suffered in Scotland during the years which are past.

7.29 p.m.

Mr. John Rankin (Glasgow, Tradeston)

I shall do my very best to condense my 45-minute speech into 15 minutes, and less if possible, seeing that this is now the popular practice. My only regret is that the fashion was not introduced again yesterday, when the debate started.

Lieut.-Colonel Elliot

I introduced it, but nobody followed suit.

Mr. Rankin

I had the right hon. and gallant Gentleman in mind when making that reference. I noted that his speech was chiefly confined to constituency points, on one of which I should like to dwell later for a few moments.

I should like, first of all, to say how much I agreed with the hon. Member for Orkney and Shetland (Mr. Grimond) when he said that the Secretary of State, in his speech yesterday, was far too complacent. When reporting to the Committee the right hon. Gentleman stated that conditions in Scotland had definitely improved during the period dealt with by the White Paper on Industry and Employment in Scotland. Today, the President of the Board of Trade told us what I am certain we all had in mind, that Scotland was part of the United Kingdom economy. When the Secretary of State spoke yesterday I am sure that he was well aware of that fact.

During the year that the White Paper covers stocks in the United Kingdom at retail, wholesale and manufacturing levels have been run down by £400 million. Consumption has decreased by 4 per cent., retail prices have increased by 5 per cent. though, admittedly, wages have gone up. I think 2.3 per cent. is the actual increase for the period, but the increase is not in keeping with the average rise in the cost of living. While wages have increased by 2.3 per cent., hours of employment throughout the whole of the United Kingdom have tended to decrease, with the result that earnings have declined in the same period.

Those are the facts of the situation, and it is very difficult to understand why Scotland should have escaped the general decline in the standard of living over the rest of the country. Of coure, that is part and parcel of the price we have to pay for the enormous re-armament programme that we are carrying, a programme which has forced the Chancellor of the Exchequer to pass part of the cost on to the housewives of the country by cutting the food subsidies. The result of that has been that almost every article of consumption that enters into the domestic budget has gone up most seriously in price. Bread, butter, sugar, bacon, tea, and coffee—the cost of every one of these items has risen drastically in the year though the Secretary of State tells us that things are better in Scotland. Clearly, age of miracles has not ceased, if Scotland has escaped the cataclysm that is sweeping the rest of the United Kingdom—

Mr. John MacLeod (Ross and Cromarty)

rose—

Mr. Rankin

It is most unfair. I do not mind giving way, but I am under an obligation to speak for a limited time and if I give way to interruptions it will take up more of my time.

I should like to have followed that economic aspect a little more closely. I notice that one of the Joint Under-Secretaries of State is not here, which perhaps is as well for he has a double load of sin in these matters, but I had better not prosecute that any further in case I prolong my speech more than I mean to. I propose to follow what has become a sort of custom in these debates, which. I think, an impartial observer would say has not been parochial. It has covered an immense field, but, naturally and properly, hon. Members have devoted a good deal of their speeches to those problems that closely concern their own areas. I will leave the wider fields and return to three matters, two of which closely affect my own constituency.

The first is the Clyde Tunnel which has been referred to by various speakers, and which was dealt with at some length by the right hon. and gallant Gentleman the Member for Kelvingrove and I want to support what he said and briefly to emphasise it. No doubt he recollects the Adjournment debate which I initiated two years ago, and in which he was able to say a word or two. We all know that this project was initiated over five years ago and that everybody agreed with it. When my own party were in power they said that it was necessary, and the Government today say it is necessary. The trading interests, the people of local consequence and the citizens of Glasgow generally, agree that the Linthouse tunnel is an absolute necessity for the City of Glasgow, not merely from the point of view of convenience but from the point of view of the proper development of the city.

The traffic streams to the east right through the narrow, congested streets of my division up to George V bridge, along six miles of waterfront, across George V bridge and then down another six miles of waterfront through the division of the right hon. and gallant Gentleman the Member for Kelvingrove. These streets are narrow and one of them in particular, Paisley Road, West, has been a death trap for years. Many people have paid with their lives for the lack of a bridge further west on the River Clyde than the George V bridge.

Only four bridges span the river in the City of Glasgow, and once George V bridge is left there is no other way of crossing the river than by out-moded ferries. Last Sunday afternoon I went to cross the Clyde at Erskine ferry. There was a line of 40 other cars waiting to cross before me. We discovered that we need to wait there for 40 minutes before we could get across to continue our journey. We therefore press for the Linthouse Tunnel to ease this congestion. Because of the debate which I initiated in March, 1951, and the pressure that was applied later, the Government allowed this Corporation to go ahead with the preliminary work, which was to cost £76,000. I understand that this work has been completed.

What is to happen now? When the tunnel was first decided upon the cost was £2,500,000. Can we be told what the cost is now, and can we be given the assurance that Glasgow will get that most necessary adjunct to her well-being? Remember that all the time consumed by these industrial vehicles in crossing the river is time wasted and adds to the costs of those commodities which we are seeking to lower at the present time.

My next point concerns Prestwick, a matter which I have been urging from time to time by Questions in the House and on which I have spoken in years gone by. In 1947, we designated Prestwick as an international airport, second only to London. When is that to materialise? Prestwick cannot function as an international airport until it is able to take, in all weathers, every machine scheduled to land there, and it cannot do that now. With only two runways, lacking the third essential runway which would give Prestwick its international status, the Stratocruisers, the Constellations—all these great four-engined machines—cannot land at Prestwick in a cross-wind of more than 25 knots.

As the hon. Member for Woodside (Mr. W. G. Bennett) will recollect, when we sometimes leave here to fly home to Prestwick we discover, at the last moment, that the flight has been put off, and we are left stranded at the terminal because the wind is blowing over 25 knots; the aircraft goes via Shannon, and nobody can travel to Prestwick that evening. I know I have at least one supporter on the other side of the Committee, so I ask the Minister to tell us what is to be the future of Prestwick.

My third and last point deals with a matter of intimate concern to me as the representative of Tradeston division, namely, the shipbuilding cancellations on the Clyde. I raised this last week with the Admiralty when I had a Question down and, frankly, I think there is too much complacency with regard to those cancellations. According to my information, since the beginning of this year two-thirds of the new orders booked by Clyde shipyards have been cancelled. In addition, there has been a reduction in new orders. During June there were four cancellations on the Clyde alone and seven in the whole of Scotland. The financial loss to the Clyde was nearly £3 million.

The significant factor here is that all these were cargo ships, and 45 per cent. of the work now on hand in the Clyde is for tankers. The cancellation of the cargo ships is significant because of the amount of finishing work that goes into them, whereas there is practically no finishing work on a tanker. My division is crowded with a host of small employers, as is the division of the hon. Member for Govan (Mr. J. N. Browne) These are the men whom, we have been told, the Government want to encourage, the ships' chandlers, and all those others who thrive on a prosperous shipbuilding industry.

These are the people who step in to do the finishing work when the structural part of the ship has been completed. The loss of these vessels is important to people in my part of the city, because it means so much to those who are engaged in the finishing trades. In the first six months of this year only 10 ships, totalling 50,000 tons, were booked as orders. That compares badly with the corresponding period of 1952, when there were orders for 57 ships totalling 500,000 tons. So far, on Clydeside 33,700 tons of shipping have been cancelled.

It was pointed out yesterday and again today that the large shipbuilders are not feeling the draught so much as the small ones. I am told that in their desire to keep going the big shipbuilders have been prepared to lose money in getting orders. I am informed that John Brown have dropped £150,000 on the "Caronia." I do not know whether there will be a great deal of sympathy for John Brown, because they lined their pockets well from 1939 to 1945. Although we respect their effort to get ships to build on the Clyde, if anyone can afford to drop £150,000 it is John Brown.

I hope I have kept the promise I made at the beginning of my speech. We are all anxious about industry and employment in our native land and about Scotland's well-being. Her well-being depends on the well-being of her people, and the well-being of her people depends on employment, and a proper dignity for labour. It is our business to make sure that this dignity is secured for them and that never again will Clydeside go back to the years that Clydeside still dreads.

7.49 p.m.

Mr. H. R. Spence (Aberdeenshire, West)

I shall confine what I have to say to the problems of the North-East and I am sure that the hon. Member for Tradeston (Mr. Rankin) will forgive me if I do not follow the arguments he put before the Committee.

I should like, first, to ask a question which is really one for the President of the Board of Trade, so I hope that a note will be taken of it. We have been told that the Buckie—Peterhead area is to some extent regarded as a Development Area. I should like to know whether that enjoys all the benefits of a Development Area or only as fat as the building of new factories is concerned? It is a most intractable area. I spent nearly all my Easter Recess interviewing over 200 unemployed persons in the various towns and villages there, so I speak with personal knowledge of the problems which have to be faced in starting up industry there. At the same time, I disclose to the Committee my personal interest in a large number of industries in the North-East.

When the Parliamentary Secretary to the Ministry of Labour spoke in the debate last night he said, speaking of Peterhead and Buckie, that he was afraid that their main enemy was geography. That is partly true, but our main enemy in the Development Areas in the North-East is the high cost of transport, which not only affects the question of development in the North-East; it is a menace to the existence of many industries that have long been established in that area and which are finding it increasingly difficult to carry on under the heavier charges which must be borne in bringing the raw materials to the factories and taking the finished products to the markets of the South.

I feel that if the Government are in earnest about the question of reducing unemployment and of encouraging new and fresh employment in the North-East they must now decide that by some means the transport charges to and from the North must be reduced. If we do not do that we are only toying with the whole question of relieving unemployment and creating new employment. I speak from personal knowledge of the problems which industry is facing, and it is essential, in my view that some reduction should be made at once.

I turn, next, to the question of encouraging industry into the Buckie—Peterhead area. In that respect, as has been said by the Parliamentary Secretary to the Ministry of Labour, the main enemy is geography, but there are other difficulties, too. There are the heavy transport charges, to which I have referred. The labour force that is available is entirely untrained, and will have to be broken in from scratch. Most of the people I interviewed during my trip through those towns have no experience of the routine, discipline and regularity of factory work.

There is in the North-East the problem of the servicing of machinery by representatives of the builders. Much of the modern machinery used in industry is serviced by special mechanics who come from the builders. In a remote area the expense and difficulty of getting immediate service is great. Unless the Government have really decided that they will make it attractive for new industry to go into that area they should scrap the idea and tell those people now that they are to be abandoned. It is wrong to lead them up the garden and make them expect something which will never happen.

I turn to another question of development. I believe it to be the feeling of the whole Committee that for the North of Scotland—the North-East in particular—development should come from Scottish industry and should be based upon some type of industry which is inherent or natural to that part of the country. If we try to graft an industrial excrescence, unrelated to its background, on to the North-East, it will probably not work. So I make the suggestion that it is to local industries that we can look for most help. Therefore, when a survey is made of the North-East—I noticed that Lord Bilsland was there last week—I hope that we shall arrange to see not only the firms in these local towns and villages, but also those further inland which might be brought into the picture.

The next thing to do is to find what firms there are which can produce more goods, and find a market for them, and, having done that, then, by discussions on the spot, to find out how best to mop up the pockets of unemployment by increasing output. We may have to use unorthodox methods and do slightly unusual things. I should like to pay a tribute to the Joint Under-Secretary, my hon. Friend the Member for Fife, East (Mr. Henderson Stewart) and his officials in all Departments, who have been most helpful in supporting and carrying out an experiment in providing employment for the Buckie—Peterhead area with which I am personally connected. It has been going on for two months and has so far been successful. It may lead to something more.

The other development that I feel can come to the North-East, apart from local industries, is a new project related to what goes on in the North-East. That is surely the production of food. It is now settled policy that the encouragement of meat production is to be accepted as a part of our programme for years to come. It is agreed by the House of Commons and the nation that more meat must be produced. As more meat becomes available so the problem of distributing our meat over the year becomes more difficult. The flush period for killing is confined to a few months of the year. The question will arise, therefore, of how to spread the meat over the months so as to give variety. That is one of the headaches now being faced by the Minister of Food.

The answer is perfectly simple; it is, by refrigeration. I suggest that instead of building in the North-East an arms factory or a project to do with the defence programme we should build a really big refrigeration plant with the necessary equipment for by-products, etc. It will be one of many; there will be others in other parts of the country. It might deal with fish as well as with meat.

Refrigeration is a necessary part of our long-term food production programme, and we may as well start now by laying down the first plant. I suggest that the North-East, which produces more meat for its area than any other part of the country—and the best meat—should be the first place in which to build such a plant. I suggest that the Government should give careful consideration to this proposal because it is a project that will be needed by the country, it will be strategically sound for the country to have it, and it will provide long-term employment for quite a number of people.

I have promised to be very brief. Before I knew the scope of this debate I unwisely asked for quite a lot of time; I had a lot to say. As time has gone on my suggested demands have become more modest, and I see that my time is up. I will merely urge the Government once again to think over their North-East development programme and make up their minds whether they can go on with it and make it attractive for industry to go into the Buckie-Peterhead area; and if they find that it cannot be done and made attractive then they should say so in order that we may know where we are. I believe that industry can be attracted there if the right means are used. I hope that the Secretary of State and his officers and officials of the other Ministries will be as successful in doing that as they seem to have been in the small experiment which I have seen carried out.

7.59 p.m.

Mr. Thomas Oswald (Edinburgh, Central)

I hope that I shall be forgiven if I do not follow the line of argument which has been followed by the hon. Member for Aberdeenshire, West (Mr. Spence). Having read Cmd. 8797 on Industry and Employment in Scotland I wish only to mention certain specific points, having regard to the fact that the pace has been set by some of my colleagues who have preceded me in their endeavours to cut down their contributions to occupy as small an amount of time as possible in order to enable other hon. Members to make their contributions.

It has been my privilege to be interested in Scottish industrial problems over several years with special reference to certain industries and the industrial establishments closely allied to those industries. It is noted in the Report that production in the Scottish chemical industry was lower than last year and that the recession was expected to be of a somewhat temporary character. Attention was drawn to the continued expansion of productive capacity of this industry and that considerable new factory space was under construction. Many of the firms manufacturing drugs and fine chemicals, as well as pharmaceutical products are now proceeding with some of these extensions.

Over a number of years concern has been shown by both sides of the industry —employers and trade union members —in that section of the chemical industry which is employed in the compounding of fertilisers. Much of these fertilisers are used for agricultural purposes and the concern of both sides of the industry over the years has been that the trade in Scotland has been mainly seasonal owing to the fact that storage space has been at a minimum. The farming community have still to be persuaded to provide storage space on the farms in order to enable continuity of production for 12 months in the year.

The Command Paper states that new buildings are being erected to increase space for these fertilisers, but it distinctly says that they are being produced out of season. I think I can appreciate this. Surely it is reasonable to suggest that such factory space could best be utilised for manufacturing purposes if the farmers themselves would make provision for all the year round storage instead of making a tremendous demand from time to time for delivery all in one specified month when in Scotland every farmer is demanding delivery of these fertilisers.

If there were continuity of production in the industry it would enable those engaged in it to create a much better plan. I see the Secretary of State for Scotland in his place. With all his remarkable powers of persuasion—if not of directive, or direction—he might approach the Scottish farmers through their association to look seriously at this suggestion and enable fertiliser manufacturers to have the opportunity of meeting farmers' demands and requirements throughout the whole of the year. It is my belief that the needs of the farmer could be met by deliveries extending over a longer period than obtains at the moment and there should not be frantic calls on the processors to deliver at a specified time when all the farmers tending the land are making demands at the same time.

Another aspect of the chemical and allied industries in Scotland is the extension of the propellant and explosives group. The factories in Scotland have certainly done a remarkable job. I express the wish that in the not too distant future this great industry will be enabled to devote the whole of its production to industrial purposes rather than for defence or war potential stockpiling.

A greater tonnage output of explosives could be used to enable us to secure more coal or to bring down much more stone from Scottish quarries and enable us to build the type of traditional houses we expect in Scotland. Much of that explosive production could be used for bringing down stone and granite in all parts of Scotland, not only for buildings but for new roads all over the country. It would be of much greater value if the potential of explosives were used for that purpose rather than that of destruction.

It is with some satisfaction that I note the completion of the new factory producing synthetic fibres at Dumfries, which was mentioned in yesterday's debate. That is a monument to the scientific development of Scottish scientists. The manufacture of this new product has the trade name "Ardil." I sincerely hope that no one will think I am sponsoring Imperial Chemical Industries, but I merely wish to draw attention to the fact that there has been an important forward step in the manufacture of synthetic fibres in Scotland.

Probably it is known in Government circles that, arising from the shortage of gun cotton at the outset of the war, when America was making a demand for all its own production of raw cotton, Imperial Chemical Industries sought to produce a substitute for cordite and produced this new fibre. It not only played its part in winning the war, but has also brought an entirely new industry to Scotland and one which will prove a very valuable commodity. It is now becoming available to the textile industry in Scotland and ultimately will save a considerable number of dollars for this country.

Another part of the Report is extremely interesting. It is stated that reconstruction schemes of the British Aluminium Company at Kinlochleven and Fort William are nearing completion. I trust that I am not trespassing on the preserves of the hon. Member for Inverness (Lord Malcolm Douglas-Hamilton) and the hon. and gallant Member for Argyll (Major McCallum) who, unfortunately, has just left his place after being in the Chamber most of the day. Schemes for further reconstruction have been approved and should increase production.

While welcoming that information, I have regard to the fact that practically the whole of the communities in Kinlochleven, Fort William and Inverlochy adjacent to Lochaber are concerned with the production of aluminium. I notice in another part of the Report that there has been a considerable decrease in the tonnage of raw bauxite which is processed at Burntisland before being shipped to the Highland reduction works to become fluid aluminium and subsequently to ingot aluminium. If there is a falling off in the importation of bauxite we might find this Scottish industry will be in the doldrums.

I should like to know whether the original establishment of the British Aluminium Company at Foyers, above Loch Ness, is to be kept in production, because, again, the whole of the community at Foyers is dependent for its livelihood on the manufacture of aluminium. I think that the workpeople in that area are entitled to know what the future holds for them and their families in this somewhat remote Highland community.

I noted with interest that in announcing his itinerary yesterday, the President of the Board of Trade said that he intended to visit the Lochaber establishment and the aluminium works there. Unfortunately, the right hon. Gentleman is not in his place at the moment, but perhaps the suggestion could be conveyed to him that when, on 5th August, he leaves for Inverness he should visit the business establishments at Foyers to see what can be done to keep this very valuable community together.

I now come a little nearer home. The question of printing and book-binding is again causing me some concern. The City of Edinburgh, of which I am privileged to be one of its Members, is world famous for its book-binding and printing. I am informed, however, that at the moment there is a considerable falling-off of orders, due in no small measure to the Australian Government's restriction of imports.

Supplies of paper and board have improved, but without orders this industry will be in a very poor state indeed. Many industrial concerns are no longer placing orders or repeating former orders, many of them of long years' standing. As a consequence, men and machinery are not working to capacity in the industry at the moment. Considerable capital expenditure is involved for extensions and buildings, and new machinery has recently been installed.

The industry is handicapped while awaiting fresh orders, and I suggest to the Government Front Bench—and probably they will convey this information to their right hon. Friend's in the Cabinet—that if they require any publications to be printed speedily and well they can do no better than invite the many Edinburgh publishing and printing houses to fulfil their requirements.

One other industry—and this brings me, in particular, to my own constituency —is having a lean time at present. I refer to the North British Rubber Co. which played, as did the Aluminium Co. and Imperial Chemical Industries, an extremely valuable and important part during the war years. But in recent months their tenders for Government contracts have not been accepted, and, as a result, redundancy, which is the new term for unemployment, has been rampant in that industrial establishment.

One thing that is worrying management and work people alike is the fact that they are in the invidious and ridiculous position of having, over many years, trained personnel to become expert in their job and now all that skill is being lost and wasted because the men and women concerned are having to seek employment in other industries and to learn from the beginning once again. I say to the Government that if we are to keep these industries working to capacity and if the national cry is to be greater productivity then we must give industrial establishments and the people who earn their livelihood in them the opportunity to produce. That cannot be done unless orders are placed with them.

I noticed with great interest the report on the industrial development of Grangemouth. As a trade union official who in the past had to deal with many of the industrial problems in that area, it gives me much satisfaction to see that today it is really beginning to find its vital place in the Scottish community. This community is steadily thriving, and the number of new developments there is to be commended.

I mention this because I want to draw to the attention of the Government Front Bench the need for similar expansion at the port of Leith, a matter which was brought out very strongly in the speech of my colleague, friend and next-door-neighbour the hon. Member for Leith (Mr. Hoy). I wish to stress that unless something is done soon, there is a grave danger of this important port deteriorating. It is true, as was mentioned by the Secretary of State, that an extension of the docks is under way, but it is more than ever necessary that the Government should take immediate steps to induce industrial concerns to avail themselves of the facilities in this area.

Plans have been prepared for new factories to be erected on ground which formerly held dwelling-houses, and which is still standing derelict. Leith is the seaport town for the capital of Scotland. While I appreciate the point made by my hon. Friend, that Leith is looked upon as a special area, the fact is that it is the channel through which much of the imports and exports from the Edinburgh area, the Lothians and the Border areas pass to the port of Leith.

Therefore, much better use ought to be made of this port. It is the largest port between the Firth of Forth and the River Tyne. It serves all the Lothians and the eastern Border counties. It supplies the facilities for all forms of cargo, as in the past, but as was stated in the Report, there has been a recession in the amount of tonnage handled in recent years.

The whole of the dock area lends itself to industrial projects. In passing, I would mention the naval dockyard at Rosyth, although I think that something should be done for the port of Leith and done at an early date. Again, I have a vested interest in the important naval establishment at Rosyth because I used to have to negotiate the wages of the people employed there. This naval establishment always suffers when a trade recession hits Scotland, and on many occasions it has been placed on a care-and-maintenance basis.

The Temporary Chairman (Mr. H. Hynd)

I think that the hon. Member is getting beyond the Vote. The port of Rosyth comes under the Navy Vote.

Mr. Oswald

I hope I am in order in making this point, Mr. Hynd, because a very large number of skilled workpeople employed in the shipyards and engineering establishments come from the Edinburgh area and to this day travel by workman's train over the Forth bridge to work and back again when their work is done. We are extremely interested in seeing that this establishment is kept running to capacity. Otherwise, we again shall have very valuable shipbuilding, ship-repairing and other craftsmen thrown upon the industrial scrapheap.

It is gratifying to note that the Scottish Omnibuses group of companies have further increased their mileage by 2 per cent., that additional long distance services have been introduced, and that important express services have been inaugurated. In addition, new and extended services are now running in the new housing areas and additional services have been created where branch railway lines have been closed. It is a handicap to expansion to have to traverse roadways throughout Scotland which, when they were originally built, were never meant to carry the amount of traffic which is passing on them today.

I would ask the Minister—I am sorry that the Minister of Transport is not on the Front Bench, but I address myself to the Secretary of State for Scotland—if he can tell us whether the sum mentioned yesterday of an additional £1 million for the expansion of Scottish roads is a final sum. Having regard to the cost per mile of re-surfacing roads today, £1 million will not go very far in the areas which need attention most.

In present conditions of transport and road haulage in Scotland, it is imperative that much more be spent on the development of Scottish roads and branch roads running into the Highlands, to give them an opportunity of making their contribution to the development of Scotland.

I do not want to say any more, although I have a considerable number of notes and could speak for a long time. The debate has been extremely interesting as a consequence of the tremendous number of facets mentioned by hon. Members on both sides of the Committee. The debate is a challenge to the Government to tell us precisely what their plans are for the well-being of the Scottish nation. It is strange that only when a war comes along is the great Scottish nation called upon and told that its people are the salt of the earth and the backbone of the country, but immediately peace terms are signed, and war disappears, Scotland is allowed to become a backwater.

We believe in the full employment policy, which has been in being since 1939 and, rather strangely, has only begun to deteriorate as a consequence of the election of the present Government. I say that this debate is a challenge. We ask the Government to accept the challenge and to tell us, before the night is through, precisely what their intentions are for the well-being of the Scottish nation.

8.25 p.m.

Mr. W. S. Duthie (Banff)

I am grateful that this debate should have been initiated and also am I grateful to my hon. Friend the Member for Aberdeenshire, West (Mr. Spence) for dealing with the Buckie—Peterhead area. I hope that the Committee will extend its indulgence if I deal with the same subject, because I have the great honour to have been born in the area and to represent a considerable part of it now in the House.

Yesterday the Parliamentary Secretary to the Ministry of Labour made a statement to the effect that there were improved conditions in Buckie and Peterhead. I hope that this was a prophecy that will soon come to pass We also had an announcement on 29th October from the President of the Board of Trade, who stated that special treatment was to be given to this area to improve its employability As a prelude to that announcement we had visits from the Parliamentary Secretary to the Ministry of Labour and from the Under-Secretary of State for Scotland, the hon. Member for Fife, East (Mr Henderson Stewart). The area consists of a chain of towns and villages along the Banffshire and Aberdeenshire coast. I speak with a certain degree of authority for that part of the area which lies in Banffshire.

The inland economy and the coastal economy are entirely separate. The inland economy consists of farming, which produces the finest beef in the world, distilling, milling and a certain amount of weaving. On account of the economic position of the coastal belt a special Committee was set up under the Scottish Council of Industry, presided over by ex-Lord Provost Fraser of Aberdeen, who was an absolutely splendid chairman of a splendid Committee. The Committee's Report was the obvious reason for the announcement which was made by the President of the Board of Trade.

The difficulties faced in that area were not lessened by the storm of 31st January, when the whole coast was literally devastated and in many parts of it a new coastline was drawn. In this connection, I must mention the splendid work which was done by the Secretary of State for Scotland in coming speedily to the help of the county council and of the local councils, and I must pay tribute to the Scottish Office for the work they did in the salvaging of the fishing vessels at Ullapool, many of which came from my area. On receipt of a telegram from the North telling the Scottish Office that the job was beyond the power of the fishermen themselves, the Department obtained and co-ordinated help of the Navy, a company of Royal Engineers from the Army, and the efforts of the fishermen themselves. The result was that not a single total loss was suffered, when 16 total losses had been expected.

We have a hard core of unemployment in our coastal districts. That is due to the progressive deterioration of the herring industry. We suffered the loss of our overseas markets for cured herring after the 1914–1918 War. Then we had the passing of the steam drifter. This condition of affairs has not been uniform. We have little oases of successful little towns. Places like Whitehills, Macduff and Gardenstown have got over difficulties which have more or less submerged other places.

It may be that in Buckie and other towns the fishermen held on too long to the steam drifter hoping against hope that the herring industry would rehabilitate itself. Other parts, particularly Whitehills and Macduff went over to seine netting. Gardenstown is a most exceptional place. It has a fine herring fleet based on Fraserburgh because its own harbour is inadequate. It hung on to the herring industry till it turned the corner. The little towns that went in for seine net fishing were able to maintain themselves, but if other ports had done likewise there would not have been enough coming in to keep them all going. The result is that we have hundreds of fishermen, fine seamen, working as casual labourers with the Hydro-Electric Board. The full force of this problem will not become apparent until the hydro-electric schemes comes to an end and these men return.

The Inshore Fishing Industry Act and the Herring Industry Act have helped to provide vessels for a considerable number of men but we still have a hard core that are shore-bound for the time being. Buckie, Findochty, Portknockie, and Portsoy have fine harbours, but they are all saddled with very heavy debts. Harbour extensions were carried out and these debts incurred in the rosy days of pre-1914. These debts still devolve in these little towns and villages and they are very hard put to it to keep going. The Fraser Committee suggested that the area should be made into a Development Area. The President of the Board of Trade, with the co-operation of the Secretary of State, decided that special treatment should be tried first to attract new industries.

Last Thursday I was present at a meeting in Buckie with Lord Bilsland and his Committee to meet Buckie Town Council representatives and representatives of industry in the coastal area of Banffshire. It became quite apparent from that meeting that the only way in which the economy of the Buckie-Peterhead area can be rehabilitated is by the revival of the fishing industry—the industry for which these very towns came into existence.

A point which I hope has been in the mind of the President of the Board of Trade is that at present Buckie can undertake no industrial development whatever; because it has no water supply. I referred to that point at the meeting last Thursday and representatives of the Scottish Office told me that no help would be forthcoming from the Distribution of Industry Act and that, therefore, if Buckie is to qualify for industrial development of any kind it must undertake a water supply scheme costing £150,000. But Buckie is excluded from any benefit under the rural water supply scheme because it is too big, and the burgh cannot face this cost. If the President of the Board of Trade and the Secretary of State are to carry out a development scheme in that area it is up to them to help the burgh obtain a proper water supply.

As I said, fishing must be our mainstay. If new factories are built, what have we to offer potential occupiers in competition with Development Areas farther south? Our transport rates at once put any manufacturer at a disadvantage unless he is manufacturing from our own natural resources. If he is processing fish or dealing with meat processing all is well, because he does not have the cost of bringing the raw materials into his factory. The Herring Industry Board and the White Fish Authority are two agencies that can really rehabilitate the economy of the Buckie-Peterhead area. The Herring Industry Board have done a great job in securing the new Russian contract. That not only inculcates new hope in the herring industry, it actually ushers in a new herring age. If we can restore to the Russians a taste for Scottish herring that taste will stay and there will be a market for our home product for years to come.

Mr. Patrick Maitland (Lanark)

Red herring.

Mr. Duthie

Not red herring; cured herring. The Herring Industry Board have it in their power to establish Buckie, Findochty, Portknockie and Portsoy as herring curing ports. The boats will land the catches there when curing prices are paid. Most unfortunately for the Banffshire coast, the difficulty now is that the herring industry has concentrated in the main port of Fraserburgh. We want our own herring landed in our own ports and not in the constituency of my hon. Friend the Member for Aberdeenshire, East (Sir R. Boothby).

Sir R. Boothby

We are nearer the ground.

Mr. Duthie

If the men get a curing price in Buckie they will come to Buckie instead of going to Fraserburgh for possibly a fish-meal price.

The White Fish Authority have caused me bitter disappointment. It has not fulfilled the hopes that we held for it. A year ago I discussed in Buckie, with the town council, and with representatives of the White Fish Authority, a scheme to bring small ports into one general marketing scheme operated by the White Fish Authority. A general constituent of such a scheme must be a flat rate whereby fish landed in various Scottish ports from Wick to Eyemouth would arrive in Birmingham, Manchester and Billingsgate at the same transport cost. It is within the power of the White Fish Authority to bring a plan of that kind into being, and I hope that my right hon. Friend the Secretary of State will insist upon something of this kind being done by that body.

The White Fish Authority, with the help of the Secretary of State, must ensure the protection of our fishing grounds. The hon. Member for Orkney and Shetland (Mr. Grimond) has already said something about catching methods, and the hon. and learned Member for Paisley (Mr. P. Johnston) has said something about new trawlers. I suggest to the hon. and learned Member for Paisley that no one at present would indulge in an investment in a new trawler considering the potentialities of the fishing grounds that are at the moment available. This international convention of which we are members must get to work quickly to ensure the preservation of the grounds. Some method of preservation must take place at the Moray Firth if our small seine net ports in the North are to maintain the little prosperity which they have at present.

There are other industries to consider. If there is anything to be said for the dispersal of industry for the safety of the nation in time of war, I would say that there is no more suitable place for aircraft production than at Boyndie aerodrome near Banff. It consists of a large fiat track by the sea. There is at present in Banff and Portsoy labour available— unskilled, it is true—which could be used to staff a place like that under expert guidance.

Again, Scapa Flow is just across the Firth. Why should we not have something in the nature of a small oil refinery in Banffshire? Our harbours can take small tankers, and it would be in keeping with the best interests of our defence to have an oil plant there. I pleaded with the Minister of Works to consider that coast as a site for an atomic energy plant, unfortunately without success—

Mr. Emrys Hughes

Anything else?

Mr. Duthie

However, a plant is being created in the Highlands somewhere. One other matter. Our beef should not leave the country on the hoof, but it should be processed before it goes.

These are a few points concerning the Buckie-Peterhead area. I say to my right hon. Friend in all seriousness that the Government having made the announcement, and that announcement having been interpreted by my constituents as the will of the Government to do something worth while for them, we in this Committee must not turn aside until the Government have fulfilled their promise.

8.37 p.m.

Mr. Malcolm MacPherson (Stirling and Falkirk Burghs)

If the hon. Member for Banff (Mr. Duthie) will forgive me, I shall follow the many good examples which have been set during the last hour or two and shall not take up what he has been saying, because I wish to keep my speech as short as possible and deal with one or two constituency matters.

I wish to touch, before doing so, on a couple of points which I shall deal with quickly. First, I wish to refer to the Digest of Scottish Statistics, with which I am extremely disappointed. It gives nothing like the amount of detail that is needed. If one compares it with the old tables of figures which it replaced in the White Papers of 1948, 1949 and thereabouts, one misses the very figures which are so useful to Members of Parliament.

I would also draw attention to the fact that, in connection with the breakdown of the working force, one-third of the total working force is contained unbroken-down under the two heads of "Distribution" and "Professional and miscellaneous services." A table of that sort is of very little use and will need to be broken down before it is of any real use.

There is a further point. We ought to have some figures relating to the capital side of Scottish industry, because a number of the questions that we have to tackle boil down, in the end, to investment policy. I appreciate that this may be a more difficult matter, but we really ought to have some information on this subject, and I think it can be obtained. I have some doubt about the volume of the investment and of the effort that is going into those newer industries in Scotland to which so much reference is often made.

The electronics industry, for example, has had a lot of publicity. Such industries are the very kind which Scotland has needed from England to enable her to diversify her industry. In the last 12 months the electronics industry produced, in the United Kingdom, work to a value of £125 million. In Scotland, it did not produce 10 per cent. of that figure or anything like it. It produced £2 million, as against £125 million. I wonder how far that is true of the other new industries, about which we hear so much, and on which the future of Scotland very largely depends. In part, my own constituency is very closely wedded to new industries.

Mr. Henderson Stewart

I thank the hon. Member for his suggestions. If he will write to us with his further suggestions we shall consider them very carefully. We should like to make the volume to which he has referred more readily available to hon. Members.

Mr. MacPherson

I am very grateful to the hon. Gentleman. I am very glad of the developments in connection with the equipment at Grangemouth docks. I would remind my hon. Friend the Member for West Lothian (Mr. J. Taylor) that two and a half years ago I was pleading for equipment at Grangemouth docks, just as he has been pleading for equipment in Bo'ness; the fact that I did so is not necessarily connected, as a cause, with the fact that we are now getting a very much better equipped dock; but hon. Members must do what they can in matters of that sort.

I want to add a word about the roads round Grangemouth. The district is, of course, having a far greater strain put upon its roads than in the past, before these developments took place, and the Scottish Office ought to pay a good deal of attention to the question whether they are putting enough capital into the repair and maintenance of the roads in that region.

I hope that the oil industry in Grangemouth will be a source of energy behind the elbows of many of the workpeople in Scotland and the rest of Britain. Although this industry is a new one so far as Scotland is concerned, it is also a basic one. I shall return to that point later.

In Falkirk, there is a very bad slump in the light castings industry. The Parliamentary Secretary to the Ministry of Labour referred to this matter yesterday, and we have discussed it previously. My hon. Friend the Member for Stirlingshire, West (Mr. Balfour) also touched on the same sort of situation yesterday. I should not like to complete this speech without adding my congratulations to those which have been offered to him, since he is a colleague of mine in the representation of Stirlingshire. I thought he made a spirited speech, full of good sense.

The Parliamentary Secretary does not hold out very much hope for a quick recovery in the light castings industry. So far, his statements have been rather depressing, and very blunt. We should be grateful to him for not having tried to smooth things over. He said that the recent improvement has been a very slight one, and that is quite true, but when one goes on to ask what the Government policy is to be there are one or two questions which must be put to the Parliamentary Secretary, in addition to those which were put to him on the previous occasion. Broadly speaking, there are two policies which we can follow in regard to the slump in the light castings industry. We can either try to revive the industry, or we can say, "The industry will die, or wither away; let us try to bring additional industry into the district."

To a certain extent, those two policies can be compatible. They are not necessarily contrary. But we want to know what is the main line of policy which the Government are to follow. Will they try to revive the fortunes of the light castings industry, or will they say, "We will forget about the light castings industry. We will do a little here and there, but we will concentrate, in the main, on diversifying industry"?

It is difficult to tell, from what the Parliamentary Secretary has said so far, where the policy line of the Government is to be drawn. On 1st May he said, quite plainly, in regard to the local position: … the first necessity is more diversity of industry."—[OFFICIAL REPORT, 1st May, 1953; Vol. 514, c. 2604.] On the strength of that, I have explained to the local people that that is what the Government think, that their policy is to diversify industry. Last night the hon. Gentleman took a completely different line.

The Parliamentary Secretary to the Ministry of Labour (Mr. Harold Watkinson)

No.

Mr. MacPherson

At any rate, it seemed to me to be completely different. He said the industry must not panic, it must not disperse its labour over new industries and it must, instead, try to find new markets. It may be that he sees a unity of expression there, but it is difficult for me to find it.

My right hon. Friend the Member for East Stirlingshire (Mr. Woodburn) and I will be attending a meeting in the locality later this week; and I can assure the hon. Gentleman that efforts are being made in the locality to help to solve this problem by employers, trade unions and local authorities. It is difficult for us to go there and say that the Government have clearly stated that their policy is diversification of industry when yesterday's statement cast a great deal of doubt on that point.

Mr. Watkinson

Perhaps I can help the hon. Gentleman. I am sorry if he misunderstood me. In the limited time I had available I could not cover every aspect, and I thought we had covered the aspect of diversification very well in the Adjournment debate. I made it plain that Her Majesty's Government want to try to give all the aid they can to the area. That means that we must look very carefully at the question, and the Government are making very great efforts to get some new industries there. We cannot tell whether that will be a long or a short process and it would be improper for me to make a guess, but what I said last night was that, while that process is going on, the local industry will make its own efforts. I said I hoped they would not panic too much, but would hang on and try to fight to get markets. I think perhaps the outlook is not quite as gloomy as the hon. Member makes it out to be.

Mr. MacPherson

I am grateful to the hon. Gentleman, and if he says the position is not as gloomy as I suggested then I put that in the setting of his fairly blunt statements and regard it as a little optimistic. He made a moderate, fair and reasonable speech last night and his intervention just now was in the same tone. I am glad to have that clarification.

I want to come to one of the possibilities for reviving the industry. If I were offered—which, of course, I am not, nor are the Government, nor the industry —the alternative between reviving the existing industry or diversifying industry, I would say, "Revive the industry." That would be my first choice and the policy which, I hope, would succeed. One of the lines of policy which can be pursued to revive the fortunes of the industry is that of modernising houses on the lines of the Stockton experiment, with which the hon. Member is familiar.

On 1st May, when we went into this in a certain amount of detail, the hon. Member agreed that the points I made about it were valid and suggested, towards the end of his own speech, that the Government ought to spend a great deal more on the reconditioning of houses. On 3rd March, however, just a little earlier, the Minister of Works had told one of my right hon. Friends that there had been a considerable decline in the amount of labour going into the repair and maintenance of houses. In the last quarter of 1951, 466,000 workers employed on this kind of work, but in the last quarter of 1952 only 408,000 were employed on it, a decline of something like one-eighth. In these circumstances, it is difficult to make Government policy square, or anything like square, with what the hon. Gentleman said.

Mr. Watkinson

The hon. Member is confusing a legitimate drop on things like redecoration, which, in our view, are probably not entirely necessary, with a major scheme of slum clearance and rehabilitation, which would be a different thing. If he wants any help in his industry it must come from the second alternative.

Mr. MacPherson

It is a question of how much help. I do not find that intervention quite as frank and helpful as the hon. Gentleman's last intervention.

The amount of light castings which is used in the kind of repair and maintenance that can be done and that is worth while doing in houses that have a length of life of, say, 20 or 30 years is fairly considerable, and there is no doubt that a lot of it has been cut down by this drop in the proportion of building labour that is being put on to repair and maintenance. The labour has gone to new houses which take a smaller proportion of light castings. I must in circumstances like that, cast a little doubt on the intentions of the Government, because that sort of action does not at all square with what the hon. Gentleman has said.

I do not want to take much longer, because I have used the allotment of time hon. Members in the latter part of the debate have been allowing themselves and I want to close with one simple point. If one turns from the question of reviving industry to the question of diversifying industry in the Falkirk area I think one notices right away the paradox of the lively, new industrial centre in Grangemouth and of under-used factories in Falkirk, and it seems to me that there is a considerable possibility of marrying the two.

Lord Bilsland has recently drawn attention to the way in which the chemical industry has become the basis of the development of other industries. There may be a possibility there of Falkirk's being put on its feet. Lord Bilsland has also pointed out the possibility of developing a non-ferrous metal industry in Scotland. I suggest that this vacuum in the light castings work in Falkirk might be filled by locating non-ferrous industry there. I see the eyes of others besides mine on the clock, and I think I had better leave the matter abruptly there to allow time for other hon. Members to get into the debate before the winding-up speeches.

8.52 p.m.

Lord Malcolm Douglas-Hamilton (Inverness)

I was about to protest on a point of order, Mr. Hynd, that in two days of debate not one Member had been called representing a constituency in the Highland mainland, which is an area very nearly half the size of Scotland, with special problems of its own. Despite certain good news that the Secretary of State has told us in connection with the Highlands, that we are to get £1 million more for roads, that as well as our share of the extra £1 million for the United Kingdom, a peat-fuelled electric generating plant is to be set up, which has immense implications and may be a tremendous help in the development of the Highlands, and that we are to get a bit more to spend on water supplies— in spite of these advantages in the basic services, the Secretary of State, bearing in mind the number of requests I have made from time to time, will not, I am sure, expect any of us who represent Highland seats to be entirely satisfied.

The development of the Highlands is a challenge which this nation, not only Scotland, but the whole United Kingdom, has to face sooner or later. De-population is going on there. We are over-populated in the industrial belt, under-populated in the remoter regions, particularly in the Highlands and Islands; and I ask for the adoption of a radical, new approach of the kind Britain has successfully used in the past to find a solution of the Highlands de-population problem, to bring once more hope and opportunity to the area, and to give our young Highlanders, men and women, the chance of making something more of their own country.

My right hon. and gallant Friend the Member for Kelvingrove (Lieut.-Colonel Elliot) said that we were once a million Scots and now we are five million. We are many more millions than that, but the bulk of the Scots are all over the world, and that is the greatest contribution Scotland has made to the world; but we have done a bad job by our own country in the process, and it is time now that we got on with making a better job of it, and with giving to our young men an opportunity of work and remunerative employment in Scotland.

The open spaces of the Highlands which have hitherto been undeveloped give a responsibility and an opportunity, but a pastoral economy is not going to hold the Highland population. We must have industries. I submit that the best brains that the United Kingdom can produce should be mobilised to deal with the Highland problem.

There are various ways in which the Government can help. The right hon. Member for East Stirlingshire (Mr. Wood-burn) was responsible for the establishment of a Development Area near Inverness. Since then no industry has come there. It is not enough just to try and attract industry; we have to go out and virtually dig for it.

There is another way in which the Secretary of State can help industry, and that is through the Town and Country Planning Act. I am not quite clear what are the different advantages an industrialist gets in practice through the Distribution of Industry Act or the Town and Country Planning Act, but it is clear he gets considerable advantage under both. I should like to see established in the North of Scotland an industrial planning board which would get to work to enlist potential industries and businesses based on national resources, and importune industrialists until they do come to this area, so that we can get our share of industry in the North of Scotland.

We produce the hydro-electric power there, it is increasing year after year, but when ultimately developed it will not be more than 5 to 7 per cent. I submit that the Highland area should carry at least 5 per cent. of the industrial capacity of Britain. We should speedily aim at that. It is nothing like that at the moment.

Several hon. Members have spoken about the burden of freight charges, and I ask the Government to go into this matter of freight charges and tackle it, because we cannot get industrial development in the North of Scotland until this very important problem is dealt with. I trust that my hon. Friend when he replies will say something about development in the North of Scotland.

8.58 p.m.

Mr. William Ross (Kilmarnock)

When the Opposition announced its intention to devote its only two Scottish Supply Days to the single subject of Scottish employment and industry, there was a certain amount of criticism and suggestions made that we could not possibly sustain a high-level debate for two days on this one subject. I think that the answer to that has been given by the quality of the speeches which we have heard over the past two days.

Mr. Hector Hughes (Aberdeen, North)

And the number left out because they were not called by you, Sir Charles, including myself.

Mr. Ross

I agree—and by the number of frustrated Members on both sides of the House who have had that soul-destroying experience of sitting for two days listening to speeches which were not nearly as good as theirs, and in the end going away with those undelivered epics in their pockets.

We have had some forthright and constructive suggestions from back benchers, and I must confess that we have had some considerable highlights in the two days. I think that not least was the fact that we persuaded, by the importance of the subject, the hon. Member for West Stirlingshire (Mr. Balfour) to break his eight years' silence. I take particular pride in that because the hon. Member was a personal friend of my father and for many years they worked together in the trade union world. I hope that we shall hear him again.

Then we had the speech of the hon. Member for Govan (Mr. J. N. Browne), who shed his mantle of Parliamentary Private Secretaryship for the occasion. His proud proclamation of Scotland as a piscatorial paradise was most moving. It was pleasing to hear him hankering after haddocks and being the champion of cod. I have no doubt that speech will have far-reaching effects. In Scotland no longer will we hear over the air that "Sausages is the Boys." In future it will be "Haddies is the Laddies."

The back benchers have certainly made the most of their opportunities. We have had a challenging speech from the noble Lord the Member for Inverness (Lord Malcolm Douglas-Hamilton) demanding a radically new approach, but then he confessed the failure of the last Government and of this Government to induce Scottish industrialists to respond to the challenge. It is not a radically new approach that we require; we require a Socialist approach. We cannot wait indefinitely for private enterprise to deal with the idle acres; failing private enterprise action, direct Government action will have to be taken. Private enterprise was given the chance during the six years of the Labour Government, and it cannot complain if it has refused to take its opportunities.

We cannot blame the back benchers for having failed to take their opportunities to persuade the Government to take action and to declare policy. I confess my agreement with the hon. Member for Orkney and Shetland (Mr. Grimond), who declared that he failed to discern any policy at all in the statements which have so far come from the Government Front Bench. We selected this subject and decided to have a two-day debate not just to give back benchers a chance but more than anything else to give the Government Front Bench a chance to put to Scotland what the Government saw to be the pattern of Scotland's future industrial development and the policy by which the Government sought to bring the pattern into being.

I led a deputation to see the Secretary of State for Scotland, the Ministry of Labour and the President of the Board of Trade. We had a frank, objective discussion during which we put our point of view, and I came away believing that the Secretary of State would open the debate with a statement on Government policy. I frankly confess my disappointment. The Secretary of State failed to give a positive statement of policy, and I am left to conclude that we are just drifting along, and if I come to that conclusion it is because the Government have failed to take their opportunity. We want proof in action of the Government's determination that blight will not return to Scottish industry and that the tales of lost opportunities that we heard from our fathers will not be the tales told by our children.

The Parliamentary Secretary to the Ministry of Labour, who gave us the best Front Bench speech that we have so far had, concluded that what was required was new thinking. We should have started the debate with new thinking; we ought not to have had a Minister of the Crown, faced with all the Scottish problems, coming to us and saying that we needed new thinking. We wanted the new thinking and we wanted the result of that new thinking in Government policy, and we have not had it.

It is very flattering to be told—it is all that we were told by the Secretary of State and even by the President of the Board of Trade—that the Government are just carrying on or rounding off the important work started by the Labour Government, such as in hydro-electricity. The increase in coal production was proclaimed, and we were told that we need not worry this year because of the greater amount of steel which is being produced —hardly an argument for the de-nationalisation of the steel industry. Altogether, the Government have failed to take advantage of the opportunity that we have offered them.

What is the position in Scotland today? We still have 56,556 unemployed, and in order to find a convenient year with which to make a comparison the Parliamentary Secretary had to go back to 1950. If he had gone back to 1949, it would not have been so good and the same would have applied if he had gone back to 1948. He would have had to go back to 1946 for a comparable year

Mr. Watkinson

The hon. Gentleman must not misrepresent me. I was most careful to say that we had to take three years, 1950, 1951 and 1952, to get a correct comparison.

Mr. Ross

I wish he had gone further back than that, and I wish that he had given for those years the figures of short-time working. The figure this year is nearly three times that of 1950, and it was not mentioned at all. I do not think that a corporate figure gives a true reflection of the position, because it fails to reveal the amount of temporary stoppages and short-time working in Scotland at the present time.

Mr. Woodburn

Under-employment.

Mr. Ross

Yes, under-employment. Scotland's percentage unemployment is still double the present-day average for the United Kingdom. I pay tribute to the objectivity of the Parliamentary Secretary to the Ministry of Labour in this respect, and also to his sincerity, but it has to be properly followed up by the Secretary of State for Scotland and the President of the Board of Trade. The President of the Board of Trade told us today that Scottish industrial prosperity is dependent on the trading outlook, and he urged Scottish industry to batter down the barriers and the obstacles to trade. Can he tell the Scottish printing industry how they are to batter down the quotas fixed by the Australians? How are the lace and textile workers to batter down the barriers built up by the Australian Government against them?

Mr. P. Thorneycroft

What I was suggesting was that they should not adopt a policy which was dependent upon erecting physical barriers themselves, because that would show how other barriers could be erected against them.

Mr. Ross

There is no evidence that they have erected such barriers. The right hon. Gentleman is less than fair, and indeed the trouble was that he disguised his lack of policy by generalised phrases, admonitions and the like. But it is not slogans that will cure the trouble in Scotland. The industries themselves cannot batter down the barriers and the quotas; they cannot get behind the Iron Curtain and create more trade between East and West. That is the work of the President of the Board of Trade and the Government, and they have not done it. It is not good enough to say that it is a question of world outlook. The right hon. Gentleman has his say about the form and pattern of what has to be done.

The Westminster Bank Review, in its issue for February this year, contained the chairman's statement. These are things to which we have to attend. Talking about the balance of payments position, which, he said, had of necessity been brought about by a most severe restriction of imports, he went on to say: The restriction of imports has already endangered the balance of trade of some of the best customers for our own exports. In short, we have balanced our accounts at a low level of trade, and it is at a high level that all countries, and most of all this country, need the balance to be reached. The Parliamentary Secretary to the Ministry of Labour and the Secretary of State for Scotland referred to the drop in unemployment. There has been a rise in production, but if the fiscal and restrictive steps taken last year had been effective, they would have led to an increase in exports. We have had an increase in production recently—I challenge the President of the Board of Trade to say that I am wrong—but we have not had an equivalent increase in exports. That is a serious matter because once again the balance of payments gap is opening.

One of the things that determined us to have this debate was the attitude of the Parliamentary Secretary on an Adjournment debate on unemployment. Paraphrasing what he said, it was that a certain amount of improvement had been made in the balance of payments, and that if we could maintain our position we should be able to pay more attention to the black spots in Scotland of which there are many.

But the Scottish problems are part of that problem. The solution of the Scottish problems is part of the solution of that question of the balance of payments and the maintenance of our position. We shall not get economic stability if we have 56,000 Scottish people unemployed who could, properly placed, be producing for export. It is unfair to say that we must await the solution of that balance of payments problem before anything is done for Scotland

Today the President of the Board of Trade appealed to the enterprise and the dynamic nature of the Scottish business man. It is a pity that the right hon. Gentleman was not in to listen to the speech of the noble Lady the Member for Aberdeen, South (Lady Tweedsmuir), Judging by that speech, she has not confidence in the enterprise of the local business people, and tonight she will be sitting here, after we have finished this debate, and will vote for subsidies to be given by the Government to that white fish industry.

Lady Tweedsmuir

As the hon. Gentleman has challenged me, I said that the only excuse for a direct subsidy was an industry of great strategic importance to this country, which the fishing industry is.

Mr. Ross

Yes, but if that enterprise and dynamism, of which we have heard so much, were there Government action would not be required. The President of the Board of Trade said that the outlook was not lush. I must say that the right hon. Gentleman is coming back to his old boisterous style and nice choice of words, and I am sure that after he has made his visit to the bracing air of Scotland, he will be restored not only to health but to full rhetorical strength.

The outlook was not lush, he said, but was suited to the hard-working nature of the Scots and their skill and their craft. The Scots have always had that hardworking nature, they have always had their skill and their craft, but that did not prevent the stagnation and decay of Scottish industry in the 1920's and 1930's. We have grim pictures of those days. The City of Glasgow with 109,000 people dependent on Poor Law relief—one-tenth of the whole population. The town that I represent with one in every five registered males unemployed. And Lanarkshire—[An HON. MEMBER: "Thirty years ago."] Yes, it was 30 years ago, but the people have not forgotten it. The shadows of those days are still remembered.

And when we talk so proudly of the glories of private enterprise, of the "Queen Mary" and the "Queen Elizabeth" being built, let us remember that the "Queen Mary" was better remembered in the Clyde as the "534." When the President of the Board of Trade says that Government action is no substitute for enterprise, let him remember that there would have been no "Queen Mary" but for direct Government intervention.

Government intervention was played down by the right hon. Gentleman. What about hydro-electricity? Where would that be if we had not direct Government action? What about afforestation, which means so much to the Highland area? What about the white fish industry, about which I have spoken? What about agriculture itself? Of course Government action is absolutely necessary. I am perfectly sure that Government action and assistance to aid the individual to see that he realises all those inventive ideas of which the President of the Board of Trade spoke so highly is the only way, in present circumstances, to create the new industries which we want to see in Scotland.

There has been too much talk about the Development Area policy. It is very important, but to my mind there has been neglect of consideration and discussion of the health of our basic industries in Scotland. My hon. Friend the Member for Leith (Mr. Hoy) intended last night to deal with the question of the shipbuilding industry but the time factor was responsible for his remarks being cut short. I was really astounded by the attitude taken by the Secretary of State for Scotland. Fifty-three thousand tons of orders have been cancelled on the Clyde after a year in which fewer new orders have been received than in any year since the war. It may be that more cancellations are coming. What was the attitude of the Secretary of State for Scotland. He said, "Well it is not so bad."

The Secretary of State for Scotland (Mr. James Stuart)

I said that it was serious.

Mr. Ross

The right hon. Gentleman said it was serious, but he also said that it was not so bad.

Mr. Stuart

I said that there was three years' work.

Mr. Ross

But there will not be three years' work if we get more and more cancellations. There will not be three years' work if we get the continued difficulties in the shipbuilding industry envisaged by the Shipbuilding Conference, and if completions are going down in the United Kingdom at a time when they are rising in other countries. The President of the Shipbuilding Conference said that much was dependent not only on delivery dates but also on the question of costs, and that the shipbuilding industry, which was so much dependent on the supplying industries, was affected by the rising costs throughout the whole of British industry.

If there is a tendency towards rising costs, where does it spring from? It springs from the policy of the Chancellor of the Exchequer. It was he who gave the surge towards demands for wages which have been accepted by independent tribunals owing to the cost of living going up. It was his food subsidy policy, among other things, that brought this about. The Government cannot shirk the consequences of their policy.

Mr. John Maclay

Would the hon. Member permit me to intervene?

Mr. Ross

I am very sorry, but my time is limited.

I agree with the President of the Board of Trade in his statement that Scotland would rise or fall with the ability of our older industries properly to prosper and expand. But the position is that today Britain is trying to earn its living in a world so much different from even the world at the end of the war, a world which is short of food and with a growing population; and so food inevitably becomes dearer. Industrialism has spread throughout the world. It is not so easy for us, first, to get the raw materials; we can only get our share. Secondly, it is not so easy to sell our manufactured goods.

We have found that Britain is vulnerable, both in boom and in slump, on the balance of payments question. In boom the demand and cost of food and raw materials go up and the cost of manufactured goods lags behind. That was the cause of the last crisis. In slump conditions once again we cannot sell our manufactured goods. We have to look into the question of making the proper use of Scottish resources and the proper use of what valuable imported raw materials we can get.

So we must have a fully efficient industrial machine. Have we got it? I do not know if the Secretary of State for Scotland has seen the report published by Mr. Lesser, Lecturer in Economic Statistics at the University of Glasgow. His conclusion, after analysing and comparing the census of production of 1935 with that of 1948, is: There is every indication that the lower output per head"— of the Scottish workers— 5 per cent. in 1935 and 6½ per cent. in 1948 is real and means a lower level of productivity. … that is in Scotland— While there are considerable variations between different industries the average Scottish industry appears to be at least 5 per cent. less productive than its counterpart in England and Wales. This difference does not show any sign of disappearing. If anything, it was larger in 1948 than before the war. What is the conclusion we must draw from that? That, once again, the emphasis is on the modernisation of our industrial plant, not only in the Development Areas but throughout the whole industrial field. Many Scottish industrialists have done that. I do not know whether the President of the Board of Trade is coming to Kilmarnock. We are very fortunate in Kilmarnock in having some of the most enterprising firms, who have made great strides and taken the opportunities presented to modernise their factories. This is something about which the Joint Under-Secretary of State spoke the other day. It is very serious and that is why I am emphasising it. He said: Productivity in the factories and farms of this country is increasing more slowly than in America. We must remember that they are increasing even more slowly in Scotland, according to the report. Switzerland, Canada and Holland and, more recently, Germany. … The keen winds of competition will force industry sooner or later to increase its use of highly-trained men, but unless we do something now to increase the supply we may be too late. On the same day as extracts from that statement were printed in the Scottish Press, there was also published the Report of the Advisory Council on Scientific Policy, which had this to say: The reason why industry as a whole did not make more use of scientists was not because their numbers were insufficient but 'because large sections of industry, being conservative or complacent, neither missed them nor asked for them'. I am afraid that is true of some of the industries in Scotland. It was proved by the point made by the Joint Under-Secretary. At the time when he was appealing for more young men and women technicians to go into this new and vital section, he was telling us that the supply in Scotland exceeded the demand. It is disgraceful. There was an important part which holds something for the President of the Board of Trade and for another right hon. Gentleman who should be here, the Chancellor of the Exchequer. The Council's Report concluded: 'It would be a grave mistake to assume that the mere production of a greatly increased number of scientists and engineers would solve all our problems.' Unless further financial and other resources are invested in industry such men could be only of limited use. If we are to meet these keen winds of competition, then more than ever in Scotland we need a modernised industry and more capital invested in Scottish development. We are not getting it, and one of the reasons we are not getting it is because of the policy of the Chancellor of the Exchequer, who set out deliberately to restrict the availability of capital and who told the banks to clamp down and to be a bit harder in the issue of capital, and he did so indiscriminately.

I am afraid I did not understand what the hon. Member for Orkney and Shetland (Mr. Grimond) meant when he suggested that the Labour Government prevented the flow of capital. At any rate, they did not prevent the flow of capital into the right kinds of industries. Whether the industries are good or bad, necessary or not, they are all restricted alike under the present policy. How much better it was for the Capital Issues Committee to consider the national need and strategic importance and properly to discriminate in favour of those who could do most good for the country. I regret this failure of the Government properly to appreciate the consequences of that policy.

There is another matter, which my hon. Friend the Member for Bridgeton (Mr. Carmichael) was going to raise, in which the Distribution of Industry Act fails. In places like Glasgow, there are old-established industries which cannot possibly expand or modernise because they have not their factory site and space to do so. We shall need to reconsider our whole attitude towards the Distribution of Industry Act in order to see whether it is possible to link it up with the question about which the hon. Member for West Stirlingshire (Mr. Balfour) spoke so movingly, that of the derelict areas. Why not give assistance to these firms to move to new sites and new factories in order that they may expand? It would be very much cheaper, because they are quite prepared to put in the plant for themselves.

I am one of the first to pay tribute to the Distribution of Industry Act for what it has achieved. It has done wonders for Scotland, But for it we would probably have unemployment in Scotland today to the tune of well over 100,000. There is no constituency or area which has derived more advantage from it than Kilmarnock. But I do not think it right that the President of the Board of Trade should set his face against any change being made in that Act. He talked today about our desire to weaken or abandon it. He is the man who has weakened it.

There is obviously not the same incentive under the Act if one deprives it of Section 3 and refuses to help the local authorities to go ahead and do the preparatory work. But when we come to the matter of the Cairncross Report, I really wonder that the Scottish Council for Industry carry on with their work. This is the second time that they have been slapped in the face by the Government. The Government did it over transport and now they are doing it over this question of development.

I am perfectly sure that no one on this side of the Committee would agree that we should neglect the remaining problems in the Development Areas. Further diversity, provided it is diversity of the right kind, must continue. But, in view of all that has been done, it is surely a diminishing problem. In the old Development Areas we have already provided much. I see it suggested that two-thirds of the tasks have been done. In view of that progressively less and less remains to be done. In fact, very little is being done. The Government should not use this argument to dismiss the Cairncross Report, for its proposals would add to the present limited policy of assisted development.

Surely, the whole lesson of the past for Scotland is one of missed opportunities in getting its share of new developments. We must husband the growth of new industrial communities, and seize the opportunities granted by the chemical developments that are taking place in Scotland. We do not get the same chance twice. To suggest, as the Government did: "Hand it over to the local authorities" does not make sense, in view of the argument of the President of the Board of Trade, who said: "We have not got the money." If the Government have not the money, where are the local authorities to find the money?

We must face this question. If the Government are to accept responsibility for the well-being of the nation, it is essential that they should retain and use power to intervene to guide and stimulate and to establish industries, consistent with their overall vision of strategic, national, government policy. The debate has shown that they have not that strategic, national, government policy. They are prepared to leave everything to private enterprise and to throw away the powers that we gave them under the nationalisation of the steel industry, for example, so vital to Scotland, and powers to get decent transport in Scotland—by their transport de-nationalisation scheme —and now they have turned down this Cairncross Report.

This has been quite an epoch-making debate in many senses. One English Minister even quoted Burns, from the poem "To a Mouse." There are, however, two lines more that he should have quoted, two lines that to my mind epitomise the feeling of the man in the street about the Government's performance in respect of the future of Scottish industry, in view of what happened last year and what has been said today. They are: But oh! I backward cast my e'e On prospects drear! An' forward tho' I canna see, I guess an' fear!

9.33 p.m.

The Joint Under-Secretary of State for Scotland (Mr. Henderson Stewart)

I, at least, find myself in agreement with the hon. Member for Kilmarnock (Mr. Ross) in this sense: we have come to the end of a debate which has been unique in many respects. Perhaps never before in the annals of Scottish Parliamentary business, as the hon. Member says, has this Chamber been occupied for two days by such a sustained and sweeping examination of Scotland's industrial position.

Mr. Emrys Hughes

What is the reason?

Mr. Stewart

I will come to that point.

Never before, as has been pointed out more than once, has the Government Front Bench been so well and so consistently full of Ministers from so many Departments. In my own fairly long Parliamentary experience I do not remember a debate which has been more constructive or better tempered throughout. I am sure that its results will be good. On behalf of my right hon. Friend, and indeed on behalf of the Government, I want to compliment the Opposition upon the part that they have played in this exercise. We have welcomed their initiative in putting down such a wide but connected range of Votes which has made this debate possible, and we hope that the precedent thus established will serve us well in the future. We all begin, therefore, upon that common point of agreement.

I have been asked a very large number of questions. My hon. Friend the Member for Aberdeen, South (Lady Tweeds) asked at least a dozen. Hon. Members have sought information upon an even larger number of matters, and criticism and comment have been made wholesale. Clearly, I could not, in the time available, even if I wanted to, cover all or even most of those matters, and I do not think that the Committee will expert me to do that.

Perhaps I may serve the Committee best if I try to gather together the various activities of the Government, explaining, if I can, the policy that underlies them. The hon. Member for Orkney and Shetland (Mr. Grimond) said that he had failed to find it. I should like to accommodate him before this evening is over and indicate, where it is possible, the broad plans that the Government are trying to carry out.

I should like to take up at once the suggestion which was made by an hon. Member in yesterday's debate that Scotland feared a slump. I say at once, without any qualification at all and with the full authority of the Government, that there is no foundation and no evidence of any kind for any such fear now. I know that we shall have our difficulties in the years that lie ahead. In this changing world we cannot foresee how trade may develop in any other country, but our experts in the Government, having examined the situation with all their skill and with all the facts at their disposal, advise us, and we accept their advice, that with good management, hard work and a bit of luck—[HON. MEMBERS: "Luck."]—yes, the nation needs some luck—there is no reason at all why the United Kingdom should not continue to enjoy growing prosperity.

But in all our efforts, and in all our daydreams of a greater Scotland of the future, two facts stand out—grim and inescapable facts. The first is the fact that for her livelihood, her sustenance and her employment Scotland, like the rest of the United Kingdom, depends, and will depend for as long as any of us can foresee, upon massive imports of food and raw materials from abroad. To acquire those necessities of life in a highly competitive world like ours we have to find increasing markets for our exports.

The second fact is that to succeed in that vital activity we have to keep our prices at the keenest competitive level, and we have to maintain, and if possible increase, the national credit in the eyes of the world. Neither fact is new. They confronted the last Government and have been with us since the end of the war. They have dominated the policy of successive Governments and they dominate policy today. Translated into the simplest terms, they mean that unless we maintain a firm control upon our economy, inflation and excessive public spending and increased taxation may well destroy all chance of national development. I make that point, in careful words, in reply to the hon. Member for Kilmarnock.

We were in great danger of that very fate in the autumn of 1951. The facts of the situation then demanded drastic measures restricting public expenditure and curtailing capital investment. Nobody liked those measures but there is no doubt at all now that they were justified and that our whole economic position is stronger in consequence. As a result, during the past year we have been able slowly but increasingly to relax restraints, and by that very relaxation give new impetus to industrial activity throughout the United Kingdom; and in Scotland, as my right hon. Friend showed yesterday, production is again rising.

Mr. Hector Hughes

rose—

Mr. Stewart

There is very little time to reply to a very difficult debate, and I ask the hon. and learned Member to allow me to continue.

Mr. Hughes

Would the hon. Gentleman answer a question?

Mr. Stewart

As the hon. Member for Maryhill (Mr. Hannan) said yesterday in a very reasoned speech, our reserves are still precarious and the country will be foolish to believe that everything is now easy. I hope that the Committee will allow me to make these preliminary observations before I come to the Scottish points. We must continue, possibly for many years to come, to husband our resources with great care. Until our national wealth is substantially increased we have no alternative but to concentrate development upon those projects calculated to render the most immediate and worthwhile contribution to our economic recovery. It is that policy that Her Majesty's Government are pursuing, and those are the thoughts that dominate all that we are endeavouring to do.

In many ways it is a heartbreaking policy to pursue. In all parts of the country there is a multitude of attractive, popular and necessary projects which call to be started. It is distressing to have to turn down or postpone so many of them. Yet I am sure that it will be clear to the Committee that if we were to sanction all those schemes now, we should re-create almost overnight the very conditions of inflation and overspending that we have fought so hard to put behind us and which, once restored, would kill the prospect of any development anywhere.

We have heard from my right hon. and gallant Friend the Member for Kelvin-grove (Lieut.-Colonel Elliot) of the desirability of the Clyde tunnel and we have heard from other hon. Members about the desirability of a Forth road bridge and a Tay road bridge. Of course, all these things would be good for our country if we could carry them forward. I should like to start them all tomorrow, but if we did them all now we should destroy the very fabric that we have created with such pain in the course of the last two years. Each scheme can only be approved if it offers to us an almost immediate return towards our economic recovery.

A powerful case was made for the Clyde tunnel by my right hon. and gallant Friend the Member for Kelvin-grove and we shall, of course, examine what he has said. In the case of the Forth road bridge, even if we were to start it tomorrow, we are told that it would take from eight to 10 years to complete, and clearly the right thing to do is to do something quickly and effectively at once by means of a ferry. That is the obvious and right thing to do, and that is what we hope we may be able to do.

As I have said, we are gradually and steadily lifting the restraints. The Committee will have observed that quarter by quarter further sums are released and grants made for public improvements of one kind or another and further capital investment is authorised. I should like to give one or two examples of these easings of restraints and of the works, developments and efforts which the Government favour and assist financially and otherwise because they feel that they contribute at once to our national recovery.

But first, I should like to take up the point made about the Export Credits Guarantee Act. I was asked to what extent this Act was applied to Scotland. The fullest use of all our powers under this Act is made in Scotland, as it is in the rest of the United Kingdom. We have offices of that Department in Edinburgh and Glasgow, and close contact is maintained with Scottish exporters.

In May of this year over 300 exporters in Scotland were insured under Sections 1 and 2 of the Act for an estimated turnover of £4 million. That figure, of course, does not include help given to firms producing in Scotland whose head offices are in London and which negotiate the credits from that city. I hope that these figures will be useful to hon. Members.

I want to give one or two examples of the operations we are carrying out, and I shall begin at the local government end. We feel it is essential that local government services in Scotland should be as efficient as possible. To that end, we have given to local government massive support in the provision of better houses for the workers, because we think that good housing is an absolutely essential condition of efficiency. We are now building more houses than at any other time in the history of Scotland.

Mr. Manuel

With fewer rooms.

Mr. Stewart

The standard is precisely that laid down by the right hon. Member for Bishop Auckland (Mr. Dalton). That is something which, I should have thought, would not be opposed even by the most ardent supporters of hon. Members opposite, in their heart of hearts. It is something for which we can take credit. [Laughter.] If the party opposite had achieved anything like our records, they would be very happy. I did not know that sour grapes could cause such a gripe.

Let us take another example of local government services. The equalisation grant, to which my right hon. Friend referred the other day, is an example of financial support, and direct action on the part of the Government, to sustain local government services.

I pass now to the basic industries. There was some criticism of my right hon. Friend because he did not devote a lot of time to the question of agriculture. As he said, there has already been a debate on the subject. I repeat what he said. We believe agriculture to be the greatest of all our industries, and the action we have taken, and the financial support we have offered to agriculture in these last 20 months, must be complete proof of the value we attach to this industry and the determination we have to maintain it.

Mr. T. Fraser

Has the hon. Member read the report, in this morning's "Scotsman," in connection with yesterday's meeting of the National Farmers' Union?

Mr. Stewart

Yes, but I do not accept all the "Scotsman" says as gospel, at any time. The fact is that there was a steady and rather terrifying fail in the agricultural area in the time of the Government of hon. Members opposite. We have stopped that fall; indeed, we have reversed it. Moreover, forestry continues to make quite remarkable advances in all directions, and we are doing our best to support this advance.

Many hon. Members—including my hon. Friend the Member for Banff (Mr. Duthie) and my hon. Friend the Member for Govan (Mr. J. N. Browne)—have mentioned the fishing industry. As the Committee know, I have had dealings with this industry for a very long time, in a political way. It presents one of the most intractable problems with which any Government can be faced. The home demand for both herrings and white fish is falling. The taste of the people is changing. It is a very difficult situation. To make up for that we have facilitated, encouraged and helped the splendid efforts of the Herring Industry Board to obtain contracts from Russia last year and this year and, with my hon. Friend the Member for Banff, I hope that we shall see a better period in this industry.

I should like to develop the questions raised by my hon. Friend the Member for Aberdeen, South about the Moray Firth, Iceland, the conservation of fish, and the Reports of the White Fish Authority, but she will understand that it is very difficult for me to do that when I have a great many other matters to cover in the time at my disposal. I shall, however—as I must do with a great many other hon. Members—ask her permission to write to her.

I pass to another of the major industries. Hon. Members opposite, who seem to find my reply so light and amusing, should realise what is happening about the development of coal resources in Scotland. I do not want to detain the Committee, but I have a list of the coal works being done, the mines being sunk, the progress being made and the capital being invested. It is a massive undertaking. The fact is that here is a piece of Scottish industry which we are doing our utmost to develop and support, and we will go on doing so. The fact that it is a nationalised industry makes not the slightest difference from our point of view.

Take steel, Here is a non-nationalised industry. I made an announcement in the debate last year about what was happening, and the Committee may like to know about the developments since then. I mentioned that a fourth blast furnace was to be erected at the Clyde Iron Works, and the manufacture of the ancillary plant is now proceeding. Work on the furnace itself has, however, been suspended owing to a change in the company's plans.

When I spoke last year it was expected that the coke required for the new blast furnace would be produced at Dixon's Ironworks, Glasgow, but it was known that the plant there would have to be rebuilt. The Scottish Gas Board is at present dependent on coke oven gas from Dixon's, but quite recently the Board decided to instal a new water gas plant, the production from which should enable them to dispense with gas from Dixon's. Colvilles will have to provide themselves the coke which they require. The logical development is to build new coke ovens beside the new blast furnace plant.

There is not a great deal of room for expansion at the Clyde Ironworks and the company have, therefore, proposed to erect the new blast furnace and coke ovens at Motherwell, where there will be space for still further expansion. This new proposal is now being examined by the Iron and Steel Board. In all, Colvilles will be investing over £27 million at Motherwell at the Clyde Iron Works and at the General Terminus Docks on the Clyde, where new ore-unloading plant is to be built. That is another project which I am glad to announce which the Government are doing all they can to support, encourage and advance.

Now a word about shipbuilding. The hon. Member for Tradeston (Mr. Rankin) made some striking and damaging comments on the situation there. He said two-thirds of the new orders had been cancelled. In fact, it is an amount equivalent to two-thirds of the new orders obtained during the same six months. My right hon. Friend showed no complacency about this; these are substantial losses of orders. All that he sought to do—and I think the Committee would wish me to do it again—was to put them in their proper setting. If I give the figures to the Committee I think they will agree that my right hon. Friend was justified in saying that there is no need for panic or anything approaching panic.

In the first six months of this year orders for between 60,000 and 70,000 tons of new shipping have been cancelled. Of course, that is regrettable, but the amount of tonnage involved is very small compared with the orders which remain. Over 800,000 tons are now under construction and work on over 1,400,000 tons, which have been ordered, has not yet begun. The total orders on the books, "therefore amount to over 2,200,000 tons and the cancellations this year amount to just over 3 per cent. of the orders for all Scotland.

Nobody is complacent about that; everybody is concerned about it. Nevertheless, I invite the Committee and the country not to panic about it. We hope, as the Labour Party hope in their document, that things will improve. In "Challenge to Britain" they say that shipbuilding has been working to full capacity since the war. But there are signs of a falling off in demand partly because the post-war boom has ended and partly because other countries are building for themselves and for export. What are the Labour Party going to do about it? The hon. Member was rather wroth with us and chastised us. He said, "What is the Government's policy?" This is what the Labour Party are going to do.

Mr. Manuel

We want to know what the Government are going to do.

Mr. Stewart

I am looking for wisdom, and this is where I find it from the other side. They say: A Labour Government will try to stabilise demand for ships, and therefore to stabilise production and employment. All possible steps will be taken to maintain a steady flow of orders in bad times as well as in good. If that is not the most pious and fatuous statement that I have ever read I do not know what is. Other great developments which we are pushing forward with all our strength and resources are the new oil refineries at Grangemouth. We support them. It is our policy to advance them. The technological developments which are already established in Scotland we propose to advance. The right hon. Gentleman asked me about technical education. He said something about cheeseparing. I do not think he could have talked with considered language, because he must know that there has been no curtailment of technical education. No local education authority or education body of any kind in Scotland that has sought to produce further buildings or further work on technical education has been refused permission. On the contrary, we are everywhere and always urging them to do still more.

Just a word about transport in the very little time left to me. Let me put the Committee right about the new grant of £1 million for Highland roads. It is in addition to everything else. It means, to summarise quickly, that developments next year and the year after of Highland roads will be substantially greater than they have been this year, and this year they have been considerable. The intention of the new grant is to provide better access for industries in the Highlands. That is what it is for—forestry, fishing, agriculture. It is a constructive, industrial effort.

I cannot deal with all the other matters I had in mind, but perhaps I may be allowed to say this, in conclusion. The policy that my right hon. Friend set himself to follow when he took office was not to be expected to be dramatic and theatrical. That is not the kind of thing that my right hon. Friend does, but I think it will be seen by any fair-minded critic that in the last 18 or 20 months there has been steady, well-considered, well-managed administration at the Scottish Office. I exclude myself entirely from that. I know this much that by the things we have done and the plans which I have sought, perhaps not very well, to expound, Scotland will see that practical, constructive advance is being made.

I noticed that the hon. and learned Gentleman said that he was impatient with my right hon. Friend. I do not know whether he was impatient with his right hon. Friends during the six years of their administration—whether they tried his patience or not. I noticed also that the hon. Member for Coventry, East (Mr. Crossman), on Sunday, made some most interesting remarks. He said: The Labour Party entered the 1951 Election without any policy at all, in a mood of sterile anti-Toryism. We have been suffering in the past two years from the effects of two Elections fought on a wholly negative policy. I think that all of us would say, "Hear, hear." At least it can be said, whether one agrees with the Government's policy or not, that it is a policy, it is clear, it is considered, and with the facts which have been displayed during this debate it can be seen that in housing, industry, and many other ways we have made a great advance.

It being Ten o'Clock, The CHAIRMAN left the Chair to report Progress and ask leave to sit again.

Committee report Progress; to sit again Tomorrow.