SCOTLAND (INDUSTRY AND EMPLOYMENT)

HC Deb 15 July 1954 vol 530 cc702-814

3.58 p.m.

Mr. A. Woodburn (Clackmannan and East Stirlingshire)

We meet today to discuss once again the state of the Scottish people and their prosperity. It is now a year since we held the last stock-taking on the question of Scottish industry and Scottish affairs. I think that I should say that we think that since then there has, if anything, been an improvement in Scottish prosperity. At that time we were concerned with grave unemployment. Today, except in one or two disturbing spots, unemployment is practically non-existent. Therefore, so far as the debate today is concerned, it is fortunate that we are discussing these matters at a time when, to some extent, we can be satisfied with the condition of affairs in Scotland.

Governments usually get the discredit when things go wrong and it is very natural that they should claim some credit when things go well, and I would not withhold any credit due to the Government for their part in creating this situation. The Government have encouraged the local authorities to continue to build houses. Since it adopted bonus schemes and modern methods the building trade has undoubtedly increased its output. In many areas we are now approaching the time when apprehension about housing is disappearing. In the County of Clackmannan the next allocation of houses will exhaust the applications on the list. It is almost a milestone in the history of this problem when even one county, which has perhaps been fortunate, is able to say that.

The situation of Scottish welfare is still satisfactory. We accord to the Government our appreciation of the fact that they have left well alone. They have continued to encourage the National Health Service. They are doing everything possible to establish hospitals and to develop the Service to meet the needs of the people. One aspect has considerably disturbed hon. Members on both sides of the Committee. I refer to the growing and very difficult problem of the people who are in the twilight of their lives and who have no one to care for them.

I ought to place on record my view that some excellent steps have been taken. It is true that we are only beginning to touch the problem, but there are already homes in existence in Glasgow, Edinburgh and elsewhere. I opened one myself when I was Secretary of State. In these homes the old people enjoy an atmosphere of home with friendly companionship and good conditions. Progress is being made.

All aspects of Scottish life depend on how Scotland works, how well it works and how much it works. Between the wars Scotland seemed to be facing decay. We used to talk about a drift to the south. It was not a drift south. It was simply that enterprise was developing in the south and it was almost non-existent in Scotland.

In the five years, 1932 to 1936, of 2,688 factories started in Britain only 102–4 per cent.—were started in Scotland. Of the people given employment in Britain—approximately 250,000—only 3 per cent. were employed in Scotland. Of course the Scots were struck with the point that with a United Kingdom Government prosperity seemed to be growing in England. Industry and population were accumulating south of the Border, whilst Scotland was seeing its people leaving the country for other lands. We also saw the humiliating picture of men decaying—able tradesmen, perhaps some of the most skilled men in the world, going into decay, being humiliated by means tests and suffering misery and degradation in some parts of the country. It was natural that people tended to say that if this was the management of Britain, then Scotland had better take in hand the management of its own affairs.

At that time there was a very active body demanding home rule for Scotland. One blessing came from that, and that was that the social conscience was stirred. The Scottish Development Committee, composed at that time of business men and the trade unions, began to take an unofficial hand in trying to find ways to put Scotland on its feet. Later on, the distressed areas legislation and the activities of the Government of the day began to make improvements in the situation.

The Development Committee was probably among the first to put forward the idea of a comprehensive plan to bring industry to Scotland and to develop it. At first it went rather slowly, which was natural, because it was a purely private enterprise venture at the start: but gradually the industrial estates policy was formed, and a good deal of progress was made before the war started. With the war these first very modest steps in rebuilding the nation got a further impetus.

When I was Parliamentary Private Secretary to Mr. Tom Johnston there was a suggestion that all the buildings in Scotland were to be used as warehouses. There was great resistance to that and eventually, as a result of pressure by the Scots themselves, the buildings of Scotland began to be used for the distribution of industry. It became a war policy to try to create industry in those areas which before the war had been distressed. Therefore, when the war was coming to an end we were already in the position that we had some factories established. I only need to mention the British Aluminium Factory at Falkirk, a typical example of that type of activity.

Tom Johnston and my right hon. Friend the Member for Bishop Auckland (Mr. Dalton), who was at the Board of Trade, played a further part in the encouragement of the Development Areas at the end of the war. My right hon. Friend the Member for Bishop Auckland had a personal interest because, with me, he took part in a Commission which went round the distressed areas of Scotland and saw at first hand what a terrific problem was involved. Later, when he had some part in putting forward the legislation, he did it with a knowledge of the benefits which it would bring. When we came into office as a Labour Government in 1945, we found already a considerable number of the foundations laid for this new impetus towards building prosperity in Scotland.

The foundation of our prosperity must lie in the condition of our people. We had a long and difficult job to get rid of the fear that came from pre-war times. We were faced with a terrible housing problem which was perhaps unequalled in any other part of the country. We were faced with a situation in which some people had been demoralised by poverty. We had to win people back to health and to self-respect.

Within the space of a few years it was possible to go to the City of Glasgow and not to see a dirty child. I had the privilege of driving through Glasgow with the Royal procession which went to open an industrial exhibition, and the comment was made that there was not one dirty child. Every child was beautifully dressed, beautifully clean and healthy. The same thing happened in other parts of the country. There was a revolution in the condition of the children.

If the Labour Government in their early years had done nothing else but what they did for the children, they would deserve the thanks of every decent person in the community. After all, the children represent the future wealth of Scotland. People came from other countries to look at our children. I hope that we never go back on the progress we made towards giving the children a chance to become decent citizens. The Government can play only a limited part in this. The Secretary of State for Scotland knows that what he can do is limited, as it must be. In the long run, the people must save themselves; but the Government were able to do a great deal.

We laid down a plan for forestry which will take 50 years to develop. We laid down a plan for financing water and drainage which will take 20 years. We laid down a programme for mining which will take at least 20 years and may go on for much longer than that before it reaches its full development. The hydroelectric scheme, started during the war, will continue and will provide electricity for as long as we can foresee. Now, as a result of the work done in the development of atomic energy and the use of the scientific resources of our country, we have the Dounreay atomic energy station which will turn this enormous power to the production of electric current for industry for peaceful purposes. We all look forward to the time when that will be the only purpose for which it will be required.

Where private enterprise was working, the Government were able to help because, after all, we can foresee for many years a country in which there is both private enterprise and public enterprise; and some of the achievements of that combination have been remarkable. My experience in the aircraft production industry shows that it has given us advantages far beyond those which America has, even with her enormous wealth and other opportunities.

For the first time in the history of this country we placed agriculture on a basis on which it knew where it was going and what its responsibilities were. For the first time it had some assurance of security. I will not go into whether that security has been disturbed or not; my hon. Friend the Member for Hamilton (Mr. T. Fraser) has discussed this elsewhere. There are disturbing factors apparent, but some of my hon. Friends will be discussing agriculture, and it is not my purpose to do so.

I admit that we would have liked to do more for fishing, but at least we tried to guarantee the industry the use of the seas, the perpetuation of its fishing rights and the possibility of maintaining the supply of fish in the sea. The position there is still in danger and we cannot claim that the problem has yet been solved.

We were able to play some part in encouraging industry to come to Scotland. The flow of industry into Scotland since the war has been considerable and has played a big part in eliminating the immediate fear of unemployment. I do not propose to go into that very fully because my hon. Friend the Member for Glasgow, Central (Mr. McInnes) will probably deal with it in greater detail, but I should like to pay tribute to the part played by the Scottish Council (Development and Industry), which is a descendant of the Scottish Development Committee.

To some extent private enterprise responds more directly to people who talk the language of private enterprise, and in setting up the Scottish Council, composed of business people, trade unionists, members of local authorities and others concerned with the economic and social life of Scotland, Mr. Tom Johnston was responsible for a remarkable piece of vision. I understand that the hon. Member for Edinburgh, South (Sir W. Darling) was the first chairman, and I think we should pay a tribute to him, although I do not see him in his place at the moment. [HON. MEMBERS: "He has been here."] We should also pay tribute to Lord Bilsland, who gave his service for many years.

The Council also had the vision of going to Scots abroad and using the good will which exists among them to try to bring trade to this country, and I suggest to the Board of Trade that far too little of this has been done. The Irish make good use of the Irish people in America, but the English never seem to make use of the Scots abroad. I do not know why that is, for the good will of the Scots in all those countries is very great. Recently I was told by visitors from a South American country that a large part of the population were descendants of Scots, with Scottish customs and traditions, but as far as I know we have never made use of that in the cultivation of trade.

Everybody knows that many Scots have gone to Canada, Australia and New Zealand, and many other countries. It is estimated that 20 million of them are scattered around the world. They are great ambassadors, and even though they are good citizens of the countries to which they have gone, they will never forget their own country, and the Board of Trade would be wise to bear their good will in mind when they are sending ambassadors for industry to these countries.

I am glad to say that Lord Bilsland and the Scottish Council have done so. They have gone to America and Canada and have been successful not only in bringing trade to this country but even in bringing industries to Scotland. Quite a number of the industries have come from these countries as a result of the Council's efforts. We therefore have seen a combination of the State, the community and private enterprise, as part of the community, through the activities of the Scottish Council, achieving a great deal.

I do not expect that the Secretary of State is intimate with all these things, because his life has not moved in the realms of the heavy industrial areas of Scotland. Perhaps they are a little closer to me, because I spent 25 years in that type of work, but I hope that the Secretary of State will take an interest in these matters, for I am quite sure that nothing is more important in Scottish life today than to have this kind of ambassadorial activity in other countries providing this link with Scotland.

May I mention one example in which I have taken considerable interest? The Labrador iron which has been developed by Canada is nearer to Glasgow than it is to the United States steel works. There are no canals to link it with the United States; it is, I hope, a plain sail over a flat sheet of water from Labrador to Glasgow. If this great development of the Lanarkshire steel works is to take place, I hope the Government are alive to the possibility of creating another link with Canada by linking the steel works of Lanarkshire with the great development of Labrador iron on the edge of the ocean at the other side of the Atlantic.

The Secretary of State has here a great opportunity. It is his honour and also his privilege to be the spokesman for Scotland and the leader of its activities, and he can do a great deal to inspire its people. I have noted with some appreciation that the programmes which were started in these earlier times have been continued and that, with the exception perhaps of road transport, there has been no serious interference with the economic affairs of Scotland by the present Government. The absence of a long-term appreciation of the future, however, may bring us to disaster, and in the short time for which I want to speak I should like to devote my remarks to my appreciation of that future.

This may be a platitude, but I think the problem of Scotland's future lies in maintaining the prosperity of its basic industries. We all talk about the need for light industry, but nothing can replace shipbuilding on the Clyde or the great iron and steel industries or the mining industries; nothing can replace our agricultural, fishing and engineering industries. These have long been established and have a historical basis, and there is a "know-how" amongst our men which is accepted by other countries, who welcome these men to their shores. There would be no virtue in trying to transfer these people from a job which they can do exceptionally well to some work which they may do only indifferently.

Secondly, we must try to correct the lopsided distribution of work and wealth in Scotland. This is a much more serious matter because it is a question of a slow movement which is not as noticeable or as dramatic as mass unemployment. In some parts of the country—the Highlands and even some Lowland counties—there is a steady, relative decay of prosperity. A county like Roxburgh and Selkirk or some of the Border counties, or the Highland counties, cannot keep modern life going on a taxation which brings in only a few pounds. They must have some industries in these counties and towns in order to maintain the normal life of the population.

Here, I think, the Secretary of State treated rather roughly the Cairncross Report, produced by the Scottish Council (Development and Industry). He seemed to believe from the Report that the Council wanted him to give up the Development Area policy. That is not my understanding of the intention at all. What was suggested, as far as I appre- ciated it, was that we should not concentrate entirely on Development Area polices but should also take into account other places in Scotland where it might be essential to stimulate some industries.

There is, of course, always the problem between town and country, but the problem between central Scotland and these outlying areas is another and very serious problem. I agree that it is not wholly within control, even Government control, because the Clyde determines where the shipyards are to be, the coal deposits determine where the mines are to be and the quality of the land determines where agriculture is to be carried on. The only interest of the Secretary of State is to see that what remains of our good agricultural land is not used for purposes not absolutely necessary.

The Government can transfer some existing industries, and there may be an opportunity in some areas, particularly if they are Development Areas, for this to be done. It may be that some of the older industries will have to move, and if so, I think it is a mistake to move them from one place to another in the same town where they have so far existed. I may be a little apprehensive about this, but I have a vision of a forest of chimneys stretching from the coast so far inland that airmen coming from America will perhaps not see green fields until they have passed Lanarkshire. Glasgow and the West of Scotland are in danger of becoming another London, and that would be a tragedy. Some long-term vision must be applied to this problem, and even Glasgow must face the fact that some readjustment of its population is desirable, and that it would be far better to do it in a businesslike way than in a haphazard fashion.

Perhaps the Secretary of State can tell us today what is the Government's policy regarding what was called the overspill of Glasgow. If Glasgow rehouses its population, it will have to spread somewhere, because there is not enough territory in Glasgow to provide the land required for schools and factories and to leave room for houses as well. What is the policy? Is the Cumbernauld plan going ahead, or is there some other scheme? It is a great expense to build a new town, because it involves providing all the services and social centres, and I estimate that it would cost £200 million to rebuild Edinburgh today. If we take a town like Falkirk, where the population is stationary and where industry is suffering a sort of relative decline, it would seem far more sensible that, instead of trying to build a new town centre, with shops and offices and all the rest, the population should be moved to those places where these centres already exist and where there is a social life. This method would preserve much agricultural land which would inevitably be used up if new towns were to be built in various parts of the country areas.

I should like also to refer to a suggestion which I made last year, and which I hope the Government will seriously consider, though I know how difficult it is for one Minister to take an interest in a matter which is not really his own concern. In almost every one of the small towns in Scotland there are engineering works, requiring only a few orders to keep them going, which can develop themselves far better than they can be developed by somebody else not indigenous to the area coming in. Instead of boys having to go away and crowd cities like Glasgow in order to learn engineering, they should be able to serve their apprenticeships in such works on the doorsteps of their own homes, and so remain in their own locality and build up their families, instead of creating further problems in cities like Glasgow.

I do not see the Minister of Transport here today, and I am sorry about that, because the next point I wish to raise concerns the mystery of Scottish transport. We are all a little puzzled about what is happening. It is true that there has been an announcement about the railways, and we know that there is to be a new uniform in Scotland. It is not stated whether it is to be the kilt, tartan breeks, or what distinction Scotland will get in the great revolution which has come about. At any rate, there is to be a new uniform. We are also to have home management of the railways, but that is also a little mysterious. I shall leave that matter to some of my colleagues, and particularly my hon. Friends the Members for Glasgow, Central and Dunbartonshire, West (Mr. Steele), who will deal with the specific problems that arise in that matter.

I should like to ask the Secretary of State a question about the roads. The Secretary of State has at least a vicarious responsibility for what is happening in Scotland. What is the mystery about road transport in Scotland? I am very glad to report to the Committee that it has not yet been destroyed, though it is true that some lorries have been sold off. The organisation, which was so good when I had some responsibility for it and which has improved since then, is still working effectively and efficiently, but I understand that the policy of the Government is still to sell it off.

My impression is that the cautious Scots are not likely to invest money in what may prove to be a very temporary ownership of a doubtful enterprise, and that it will be very difficult to get anybody to risk millions of pounds in a venture which cannot bring much profit and might well involve them in very considerable losses. That is not a party point of view, but a perfectly sensible point of view, which even those hon. Members on the Benches opposite who are interested in private enterprise will understand. One cannot expect private enterprise to put money into an organisation when those concerned know they will lose it.

Here I want to make a suggestion, and I do not want to score any political points at all. We are discussing Scottish prosperity, and everybody agrees that it is essential to Scottish prosperity to have an efficient transport system. The Government have promised, and I understand are going to set up, an organisation to co-ordinate all transport that still remains in Government hands. I should like to ask anybody with any common sense whether it is sensible, if we are to set up a committee to co-ordinate transport, immediately to hive off a section of it and place it outside that control? That is absolute nonsense, and I challenge any hon. Member to stand up and defend such unbusinesslike nonsense.

Therefore, I say to the Secretary of State that there is still time for an inquiry even now. I do not mean an inquiry by Labour Members, by trade unionists or even by Conservatives, but an inquiry by the users of transport, who understand this problem of Scottish transport. Let them bring back a report. There will be no loss of face by the Government. Let them take a lesson from the Prime Minister. Immediately the Prime Minister finds that a policy is no good, he does not hesitate to scrap it. He does not hold on because of something that he said 50 years ago. He is willing to change his mind at any time, and he does not care twopence about it. Therefore, the Secretary of State should take a lesson from the Prime Minister.

The Government should set up an inquiry to look into this question of Scottish transport and see whether there may not be some rearrangement of the plans to permit of those efficient maintenance and repair organisations being retained, because they cannot be effectively replaced by private enterprise. Private enterprise cannot use them, and they will therefore be sold and broken up. That may mean that one day the nation will have to re-establish that organisation when an intelligent Government come back to deal with this problem. I hope that even this Government will become intelligent before that happens, and will deal with this problem in a proper way.

The greatest investment for the future of Scotland is in the new generation. Unless Scotland builds a first-class population, Scotland will decline. Its geographical situation, its transport difficulties and its remoteness from raw materials create great problems, but I think it makes up for that deficiency by the quality of its population. I suggest that we need more science in industry, more education and training and more power for the workers, but unless we have workers who can use that science in industry, science itself is of no use.

We must provide more electric power for our workers in industry if we are to maintain our trade and our normal standard of life. Scotland missed the motor car and the aeroplane industries, which were developed by the smartness of firms in the south of this Island. There are types of engineering in which Scotland can hold its own, especially in the type of motor car which does not depend upon mass production. When it is an engineering question, Scotland can hold its own. Scotland missed those big industries, but we must remember that there are no ways back to yesterday. We cannot go back 30 years; if we want to have a big aircraft industry, we shall have to transfer an existing industry.

Scottish Aviation is doing its best, and in time it may build up very considerably. Remember that it takes 10 years even to create a design staff in the aeroplane industry, let alone the further time necessary to get orders and to develop new aeroplanes. However, we are on the ground floor in the new age of science. The atomic energy station is coming right into our Highlands. We have chemists in Scotland who are second to none and we are producing scientists in our colleges and universities at a proportionately greater rate than is being done south of the Border.

If the Secretary of State wants to give Scotland a lead, he should ask it to jump into this age of science with energy, enthusiasm and enterprise—and especially enterprise. Let him give a call to Scotland to open its eyes and its doors to the new age of biological, chemical and physical adventure, and so inspire our youth to seek the knowledge and the skill to serve it. We must renew our faith in Scotland, and then Scotland can be master of its own fate and, in Henley's words, captain of its soul. I am certain that the Scottish people can go forward to take a record place in the constitution of world civilisation, and of that none of us need be ashamed.

4.32 p.m.

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

Let me say at the outset how grateful I am to the right hon. Member for East Stirlingshire (Mr. Woodburn) for the very fair and, indeed, generous words he used in connection with Scottish housing progress, the employment position, the health services and the welfare schemes for the aged. I join with him in paying tribute to Lord Bilsland and his colleagues on the Scottish Council for their work in encouraging industries to start up in Scotland. That work is of the greatest value to Scotland. I agree with the right hon. Gentleman in hoping that they will do all they can to encourage Americans. Canadians and even Englishmen to join in this progress and development. The more development we have the better.

The right hon. Gentleman raised many points, and I shall endeavour to cover them in the course of my remarks. He referred specifically to the treatment meted out to the Cairncross Report, and I will say a word about that matter. My right hon. Friend the President of the Board of Trade will take part in the second day of this debate and will no doubt deal in some detail with the distribution of industry.

The Government's present policy is to give a preference to the Development Areas because they contain the great weight of unemployment. I would stress at the same time that our policy is flexible. We encourage industry to settle in other parts of the country where this is desirable. Indeed, since the war, the number of factories approved in Development Areas amounts to 61 per cent. of the Scottish total, and this does not seem out of proportion when we remember that the Development Areas contained 56 per cent. of Scotland's insured population. As has already been remarked, we cannot order industry to settle in these areas but we can do our best to encourage it. As the chairman of Imperial Chemical Industries remarked in a recent speech, this will depend a great deal upon whether the services necessary for industrial development are available in the areas in which we wish industry to carry out development. I expect that my right hon. Friend will develop this subject more fully on Monday.

I do not want the Committee to think that I am in any way criticising or opposing the method of discussing Scottish Estimates by the staging of a very wide debate covering two days, because that impression would be incorrect. I regard it as a useful and sensible arrangement, because it provides a much more comprehensive debate covering the industrial and economic position of the whole country than can be achieved on an ordinary Supply Day on a special topic. Nevertheless, it is not an easy task to compress into a short period of time all the available material and to give the Committee an overall picture of the outstanding matters and the general position of Scotland. Some points of detail will be dealt with later today by my hon. Friend the Parliamentary Secretary to the Ministry 'of Labour, as well as by the President of the Board of Trade on Monday. There will be further points which it will be necessary for the Joint Under-Secretary of State for Scotland to take up when he winds up on Monday night.

The Budget debates gave us the background of the economic position of the United Kingdom. They proved that 1953 was on the whole a good year. I do not want to make party points but to present a fair statement, as the right hon. Member for East Stirlingshire did in opening the debate. There were certain world factors which operated in our favour. World trade revived slightly and, generally speaking, continued to move in our favour and to help our export trade. Against this, there was some slackening of industrial activity in the United States of America; but 1953 showed a satisfactory surplus on our overseas balance of payments. At home our industrial production reached a record level. I am not going to suggest that our overseas surplus was big enough, and it is clear that we did not invest enough in our manufacturing industries. All the same, we had behind us substantial achievements when we entered the present year, 1954.

Let me turn to the Scottish position. Of the same period it may be said without exaggeration that we emerged quite well. Our industrial production was at a record level in 1953. The volume for the full year was nearly one-fifth, or 20 per cent, above that of 1948, and it was about 5 per cent. better than in 1952. Much of this recovery in production was due to the progress of the building industry and to the increased output of textiles and of consumer goods.

Recovery in the engineering and metal industries was slower and rather disappointing, it being only about 1 or 2 per cent. better than in 1952, and not equal to the level of earlier years. However, I am glad to say that it improved towards the end of the year and that it maintained this improvement during the first months of the present year.

The present position is that production as a whole so far this year is about 5 per cent. greater than during the same period last year. I am glad to report that much of the increase derives from the engineering, vehicle and allied trades which are now producing about 8 per cent. more than in the same period last year, and more than in any similar period in earlier years. But there is one important exception to this to which I must refer in order to give a fair picture, and that is the mining and quarrying industry where production still tends to remain on average very close to the 1948 level.

The effect of the overall position is, of course, reflected in the unemployment figures, as the right hon. Gentleman recognised in his opening speech, and these show a heartening improvement which I am very glad to announce. I am sure that the whole Committee will feel glad, because by mid-June last unemployment fell to 51,491, which is a rate of 2.4 per cent., compared with 2.7 per cent. in June 1953, and 3.2 per cent. in June, 1952. With the exception of 1951, this is the lowest Scottish rate since 1948. All being well—touching wood, as I am—and if the present trend continues, I am hopeful that we may see the figure fall this summer below the 50,000 mark.

The heavy industries are, of course, the foundation of our prosperity in Scotland, and of these coalmining must be regarded as occupying a very high priority. The Scottish position is well known to most hon. Members in the Committee. It is estimated that between 1946 and 1965 we shall lose about 6 million tons of coal a year through the closing of old collieries. Of course, that is a matter of very serious concern, and, consequently, it is absolutely vital to our prosperity that progress in new sinkings and extensions should not lag.

I am glad to report that satisfactory progress was made last year in this direction. A new sinking was started at Monktonhall, and two more have been planned in Fife. Mechanisation at the coal face has also been increased, and it is expected that these developments will replace and exceed the loss caused by the closing of the old pits. In spite of these changes in the picture of the coalmining industry, the output of deep-mined coal in 1953 reached 22.82 million tons, and was nearly equal to the 1952 output.

I am glad to say that in iron and steel the production figure gives cause for satisfaction, the 1953 figures being better than those for 1952. The actual steel production rose 10 per cent. compared with 1952, while the production of pig iron in 1953 remained approximately the same as in 1952, but during the first five months of this year the production of pig iron increased from an annual rate of 870,000 tons in 1953 to an annual rate of 940,000 tons. Supplies of steel plate now seemed to be equal to current demands.

I am sure that hon. Members on both sides of the Committee will have read with satisfaction during the past few days the announcement made by Messrs. Colville of a major development which they intend to carry out to their Motherwell plant. This development, which it is hoped will come into production during the autumn of 1957, will cost between £20 million and £25 million. It provides, in essence, for the erection of a modern blast furnace with two batteries of coke ovens and ancillary plant, together with a new steel melting shop. The scheme will increase the capacity in Scotland for the manufacture of pig iron by 315,000 tons a year, and will greatly diminish the dependence of the Scottish steel industry on imported scrap. Steel-making capacity will be increased by 220,000 tons a year. This is by far the largest and most far-reaching development which has taken place in the Scottish steel industry since the war, and I think we all agree that all credit is due to Messrs. Colville for their vision in undertaking it.

In regard to shipbuilding, the picture is not so clear cut, or, indeed, I am afraid, so satisfactory. It is true that more tonnage was completed last year than in 1952, but the figure was not so high as that in 1951. The supplies of steel plate are better and delivery difficulties have been overcome. This is satisfactory so far as it goes, but, unfortunately, there is a lack of new orders which causes anxiety. The bigger yards have orders for two years ahead, but some of the smaller yards, which are busy just now, are looking out for future contracts. I think that had this tendency been peculiar to the yards on the Clyde, it might have been easier to endeavour to do something about it by attracting orders from elsewhere. The fact is that this falling off in demand for new merchant ships is world wide.

Mr. Emrys Hughes (South Ayrshire)

Is it not a fact that the orders are there, that the Soviet Union has given the orders, but that the Board of Trade will not sanction them?

Mr. Stuart

I do not want to say anything premature on that subject. It may be possible for my right hon. Friend the President of the Board of Trade to say something more about it on Monday. I think it depends to some extent on the type of order, but I am not indulging in a defence debate at this moment. In addition, the industry is facing heavy competition from the Continent on the ship-repairing side of the business, which is also a rather discomforting outlook.

There are, of course, many industries which one could examine in detail, but I can only touch on a few of them. For example, there are many branches of the engineering industry which have exceeded previous production levels, and which it would be very interesting to examine if time permitted. In addition, chemicals have increased their production, and apart from some short time in the carpet industry, textiles had a full and productive year. May I just mention, in order to interest some Scotsmen at any rate, that the favourite in the export field ran even better in 1953 than in the previous year. I refer to whisky, of which the exports in 1953–54 were valued at £38.2 million as against £34 million for the previous year.

These industries represent the brighter side of the economic scene, but, against this, there were difficulties in the locomotive building industry which has encountered severe competition in overseas markets. In brickmaking, I am glad to say, more records were broken. The 1953 production showed an increase of 36 million bricks over the 1952 figure, and current stocks are now sufficient to allow a reserve to be built up against peak demand in the early autumn.

An important industrial development has been the decision to give financial assistance to the development of the Prestwick "Twin Pioneer" aircraft. This is the very promising new aircraft to which the right hon. Gentleman referred. I am not denying that Scotland has not been to the front in this particular realm, and I am very glad that this development is taking place as great hopes are entertained of the future value of this promising new aircraft for service in the Highlands as well as overseas.

The right hon. Gentleman referred to the North of Scotland Hydro-Electric Board. There are now eight major schemes in hand. including the Breadalbane and Shin schemes, which were approved last year. The annual production from the Board's stations now in operation is 1,333 million units, and this amount will be more than doubled by an additional 1,416 million units by the schemes now under construction. More than 8,000 men were employed on constructional schemes in June. That is 2,000 more than at the same time last year.

Distribution is also proceeding satisfactorily, and only about 19 per cent. of the potential consumers in the Board's area remain to be connected to the mains. More than one-third—36.7 per cent.—of the farms, and 43 per cent. of the crofts in the Board's area now have electricity. There is at present a scheme before Parliament which will link the new Shin scheme to the Board's grid, and bring hydro-electricity to the county of Caithness. In the South of Scotland the Barony power station, which is being constructed in Ayrshire, has been designed specially to use coal slurry. Other developments will, during the next three years, increase generating capacity by 300,000 kilowatts.

I think that on the whole, despite some serious anxieties such as I have indicated in certain sections, the important sectors of industry I have so far touched upon give cause for a degree of satisfaction. While recognising that progress has been made during the year, it would be wrong to be content with its extent. However, I would like to refer briefly to two factors to which the right hon. Gentleman referred—and certainly to one of them I hope industry, not only in Scotland but throughout the country, will devote increasing attention.

The first factor is productivity, because it is on increased productivity that our main hope of improving our standard of life rests. In 1953 the British Productivity Council was getting under way and later there was the setting up of local productivity committees to assist it. Success in this field depends on co-operation between both sides of industry, and I trust that both will give this their full support.

The second factor is the need to make the best technical use of our resources. The search for new industrial processes, new products and improvements of old methods is supremely important. Here again, co-operation is called for between the business firms, the Department of Scientific and Industrial Research, industrial research associations, the universities and the technical colleges. Each can help the other, and I trust and believe that they will co-operate energetically in this way to ensure that we do keep to the front in these matters. During the next few years we should see the constructive results from the developing Department of Scientific and Industrial Research laboratories at East Kilbride, from the electronic research scheme sponsored by the Scottish Council, and from the very varied work being undertaken by the other bodies which I have mentioned.

Perhaps I may now turn to the industries which come within my own particular sphere of responsibility, namely, agriculture, fishing and forestry. On the subject of agriculture I shall say very little, because the Committee will know that this was debated upstairs earlier in the week. I would merely like to put on record that in 1953 farming productivity maintained a high level, with the emphasis on livestock production. As in the previous year, the level of output was about 50 per cent. over pre-war.

About forestry, I wish to say a little more, because that is not so often debated in this Chamber. There was continued expansion and development in 1953. The Forestry Commission planted approximately 31,000 acres in 1952; in 1953 the figure was 34,000—an increase of 3,000 acres. As a result, employment increased by 250 up to 4,829 in 1953. By March of this year a further 123 men were being employed in the Forestry Commission. This increased activity is all to the good, but we also want to encourage private owners to play their part and plant all that they can. If they cannot undertake the planting of suitable land, I trust that they will do their best to help by making such land available for the Commission to plant. It is by such voluntary co-operation that we can best achieve the Government's objective of promoting forestry as an instrument of economic and social regeneration.

Planting, as is obvious, is only one side of this work. There is employment first in clearing and planting and then in thinning. It may be of interest to mention that 1953 saw an increase of 1½ million cubic feet of timber from thinnings and other fellings. I am referring, of course, to the Commission. The value of these thinnings does not go very far to meet the cost of afforestation, and I would greatly like to hear of more wood-using industries coming forward to settle near our forest areas. Factories of this kind will greatly help local employment in or near the timber areas. The Forestry Commission and the other Departments are most anxious, as I am myself, to encourage this.

The third industry to which I referred is the fishing industry. The position is that more white fish was landed in Scotland in 1953 than in 1952, but prices were lower. I am glad to say that during the first five months of 1954 the catch was larger both in quantity and in value than in the corresponding period of 1953. I hope that this trend will continue. Nevertheless, the near and middle waters sections of the industry remain in difficulties. The subsidy was increased last year, but costs, particularly of fuel and wages, have since risen. The trawler owners, both English and Scottish, recently asked for an increase of 8d. per stone in the flat-rate subsidy paid to boats between 70 and 140 feet.

That would have cost over £1 million a year more and, after careful consideration, and keeping in view that the maximum provided for by Parliament last year was £10 million to cover the period of five years ending in 1958, we have felt unable to do this. But we do recognise that some further temporary help is needed, and a draft scheme providing for higher payments to all steam vessels up to 140 feet, and to motor vessels between 100 and 140 feet is being presented to the House today. These increases will cost about £¼ million a year and they are designed to help the trawlers in greatest need.

We regard this subsidy as a temporary measure to tide the industry over the period until the full effects of the Over-fishing Convention are felt, until new trawlers can be built and until other necessary measures can be taken to improve the conditions of the industry. The Minister of Agriculture and I are keeping the whole position under review, and the draft scheme to which I have referred will operate, if approved, only for one year. There will be a further opportunity, therefore, for the House to reconsider the subsidy arrangements before next July at the latest.

Mr. James H. Hoy (Leith)

I understand that the fishing industry was promised an answer on this point by the first of this month. Will the right hon. Gentleman say whether this new subsidy will be paid retrospectively from 1st July?

Mr. Stuart

Offhand, I can only say that it has got to be approved in the first place, and I will ask for an answer to be given to the hon. Gentleman's question.

Having endeavoured to cover some of our major industries briefly, I should like also to say something about the Highland scene because, beautiful as we know it to be, it nevertheless contains its problems, and no one would pretend that there is any quick, easy or spectacular solution. But there have been encouraging developments which, in our view, are on sound lines. Agriculture in the Highlands at present is deriving benefit from the effect of the Livestock Rearing Acts, the Hill Farming Acts and other production grants, while the Report of the Crofting Commission, which, in my opinion, is a very able one and is also a most interesting report to read, gives a helpful and hopeful line to follow up in the interests of the crofting areas.

To revert for a moment to forestry, in the Highland counties as apart from the rest of Scotland, the Forestry Commission has now 2,233 workers in permanent employment, which is nearly 500 more than in 1950, and this figure, I should point out, takes no account of those in private employment or employed by timber merchants who, of course, do a great deal of felling. Last year, the Commission planted 14,000 acres in the Highlands and we should like to see this figure increased, but, of course, suitable land must be acquired for the purpose, and this again demands co-operation between the various interests. We all know that the views of agricultural interests and so on have to be taken into account.

As to other developments, the right hon. Gentleman referred to the atomic energy plant at Dounreay, in Caithness, which will provide substantial employment, and added to this, there is the peat plant at Altnabreac in the same county, and the Shin Hydro-Electric scheme in Sutherland, and these schemes together will make a vast change in the outlook for the future of our two most northern mainland counties. In addition, at Inverasdale and Campbeltown the Argyll County Council and Campbeltown Town Council have shown commendable enterprise in providing factory premises, in one case for an engineering firm and in the other for a clothing firm. I hope that these admirable examples will be followed by other local planning authorities and that they will seek and find opportunities for the encouragement of other new industries in the Highlands. I know how interested hon. Members are in all such projects.

The right hon. Gentleman referred to transport, and I do not wish to take up too much time on this subject. I would just say briefly that we realise that an efficient transport service is of vital importance to industry, in which I include agriculture, fishing and so on, and, as hon. Members know, a programme was prepared last year for the much needed improvement of our highway system in the Highlands. Money, of course, is the limiting factor, and I hope that the start now being made, and in particular the major Scottish schemes proposed, as well as the Highland programme which I announced recently, will be of marked benefit to our industries throughout the North.

Further, as hon. Members know, a White Paper has now been presented outlining the railway reorganisation scheme. We believe this to be on sound lines, and we also believe that it will prove to be a flexible scheme which will permit of further development as experience in the working of regional management grows. As soon as the Scottish Railway Authority is appointed, we shall proceed to the establishment of the Scottish Transport Council. I may say that the railway charges scheme has thrown an enormous burden of detailed work on the British Transport Commission, but it is hoped to publish a scheme very shortly. No doubt—and I say this with some anxiety in the presence of my right hon. Friend the Leader of the House—there will be opportunities for representations and discussion in the near future.

Mr. James McInnes (Glasgow, Central)

I think it is desirable that the right hon. Gentleman should give the Committee some information about the proposals submitted by the British Transport Commission to the Minister for the setting up of an independent transport authority in Scotland. We should like to know if the right hon. Gentleman is aware of what has happened to these proposals.

Mr. Stuart

I am not the Minister of Transport, and I would not like to say anything in this debate on this subject without his prior knowledge and agreement. I think that if the hon. Member has questions to ask in the course of the debate, my hon. Friend the Joint Under-Secretary will do his best to answer them because he will have a little time in which to look into any points which may be raised.

Mr. William Ross (Kilmarnock)

Will the right hon. Gentleman also tell us how far things are going with regard to the break up of British Road Services, and what is being done about that in Scotland?

Mr. Stuart

My hon. Friend the Joint Under-Secretary has already got a note of the right hon. Gentleman's questions on that point and he will endeavour to give further information before the end of this debate.

Mr. A. C. Manuel (Central Ayrshire)

I am very grateful to the right hon. Gentleman for giving way. He mentioned the setting up of the Scottish Transport Council. Could he tell the Committee whether that Council, once it is set up supposedly in control of transport in Scotland, will have anything to do with fixing fares or freight charges in Scotland?

Mr. Stuart

The White Paper which has been laid will, I suspect, be the subject of debate in the future, and I really think that in my position it would be unwise of me to go into details as to who shall fix fares. I can only do so by agreement with the Minister concerned.

Finally, as to the future, I think there is no reason to anticipate any serious setback in the near future, and I trust that the progress in 1953 in the industrial field will be continued. We must, of course, always bear in mind that the world's markets are becoming increasingly competitive and that our industries must be ever alert in order to retain their lead.

This September the second Scottish Industries Exhibition will be staged, and I am sure that we are all very glad to have read that Her Majesty the Queen Mother has graciously consented to perform the opening ceremony. This exhibition will, I am confident, provide a magnificent opportunity for our industries to display their latest products and to benefit by offering their goods to the buyers of the world who will come from overseas to visit it. We must all he indebted to the Scottish Council and its Exhibitions Committee for the magnificent work they have done in organising this great trade fair. I can say, I think, with confidence that there is every indication that its success will be even greater than that of the pioneer exhibition of 1949.

5.10 p.m.

Mr. Thomas Hubbard (Kirkcaldy Burghs)

I am quite sure that the rather general picture the Secretary of State for Scotland has just painted will be a matter of satisfaction to the Committee and to Scotland as a whole. What must be emphasised is that this pleasant picture of the state of industry and low unemployment figures cannot have come about by accident. Our thanks are now due to those whose planning in the past has resulted in the improved situation today. No longer are we faced, as we were in years gone by, with idle factories and coalfields in Scotland. We must all remember that, pleasant as the picture is today, our job is to ensure that it remains so in the future. A pleasant picture can be clouded over very quickly.

From now on the debate will probably deal more with certain industries than with the general picture as presented by the Secretary of State and my right hon. Friend the Member for East Stirlingshire (Mr. Woodburn). But, although hon. Members will bring in their own constituency problems, those problems must merge into the overall position of Scotland, and that, in turn, must merge with that of the whole of Britain. I want to start my contribution by referring to the possible future loss of coal as a result of the closing down of certain coalmines. I must declare straightaway that I am in favour of the development of industry, and Development Areas, but, as has been mentioned, development cannot be restricted solely to Development Areas. The areas of the potential new coalfields must also be taken into account in formulating our development plans.

It is essential that coal production in Scotland is maintained or increased. It is just as necessary today as it has been in the past, and, so far as we can see, it will be just as necessary in the future, notwithstanding hydro-electric schemes and the possibilities of atomic power. It has already been stated that a number of new sinkings have been made in Fife-shire and in other areas in Scotland, and many more will be necessary. But we cannot solve the problem of the production of coal merely by sinking a pit. That pit has to be manned. It is no use going carefully into development plans unless we can be sure that we shall have available the right type of manpower in the right place at the right time. If we cannot ensure that, the sinking of these mines will be a sheer waste of money and future production of coal will be in the melting pot.

In the neighbouring constituency of mine—Rothes, in Glen Rothes—a coalmine has been in process of preparation for some years. It has cost many millions of pounds. A few weeks ago the sinking of a new pit shaft was started in Seafield, Kirkcaldy, and another in Valleyfield, in West Fife. In contrast to this, the Secretary of State for Scotland has told us that there are some areas in Scotland where the mines are becoming redundant. In those circumstances, it is clear that in order to man the new collieries highly skilled labour must be attracted to them from the areas where redundancy is occurring. Unless something is done along these lines the future prospects, for Fife, at any rate, will be rather gloomy.

At the present time there is no unemployment problem in my constituency; in fact, there is a shortage of labour. My anxiety is directed mainly to the problem of providing labour for the new coalmines in respect of which new sinkings have been carried out. In order to attract new labour to these areas suitable employment must be provided for the rest of the miners' families. Very attractive alternative industries must be established in these areas if they are to attract people from the areas where they have been brought up and have their roots.

In Fife there are two deep water docks standing practically idle. That is tragic It has already been stated that the Government cannot direct new industries into any specific area; they can only attract them. The greatest consideration is whether it will be economical for new industries to establish themselves in the area, and one of the most important factors in this connection is the question of transport charges for bringing in raw material and sending out the finished products. In Fifeshire, freight charges constitutes an obstruction to the establishment of new industries. It is sheer madness to confront potential new industries with these high freight charges, especially when they could easily be reduced if the deep water docks at Methil and Burntisland were developed.

We have been trying to get something done in this direction for some time, but we are always told that this belongs to the Minister of Transport; that belongs to the Minister of Fuel and Power; something else belongs to the Secretary of State for Scotland and the Minister of Labour is also involved. It is all a question of "Passed to you," and nothing is done about development. These docks are now in such a condition that they are not attracting any new labour. The skilled labour force is growing older all the time, and some day, when we wake up and realise that we must use the docks, we shall find that there is a shortage of the necessary kind of labour.

Today, we find that the skilled dock workers are setting out in the mornings to work at Grangemouth or even Glasgow. If this situation continues it may stultify our effort to increase coal production. I welcome the sight of the Secretary of State sitting on the Front Bench with all the other Ministers concerned sitting beside him. If we could have them all sitting on the same platform in Fifeshire we might be able to produce some effective action, because questions and proposals would not have to travel so far from one Department to another.

Of course, people cannot always expect to have a factory built next to their houses, but it seems mad to me that we are sinking mines, building large numbers of houses, including special houses for miners and agricultural workers, building a new town, extending neighbourhood units in Kirkcaldy, all without providing at the same time industry for these growing and new towns. Are we first to draw a large population together and only then to try to provide industry for them?

At Rothes there is a new mine almost in production, and there are other developments in western Fife as well as in the Kirkcaldy area, but we seem to be housing people without providing work, or providing works without housing accommodation for the workers. It is madness, and unless something is done to correct this tendency no one will be grateful to us in the future for our present planning, and we shall have fallen down on our task. That is a job for the Ministers assembled in the Committee today. I am not suggesting that we shall solve all our problems in this debate, but I do suggest to the Secretary of State that he ought to put a padlock on his colleagues alongside him to ensure there is proper liaison between them all so that we can obtain proper development in Fife along the lines we have suggested.

It is all too easy to throw on the miners the blame for the failure to increase coal production more. That does not help. I am rather proud of the fact that our Scottish miners, in spite of a great many difficulties, have not only maintained coal production but have increased it. I am also rather proud of the fact that the Scottish Miners Union, sometimes condemned because it has Communists as leaders, has a very fine record in the prevention of unofficial strikes. It is a rather remarkable fact that at a conference not many weeks ago I heard condemnation of unofficial strikes from the Miners' Union. It is making every effort to keep up coal production. The rather foolish criticisms in the newspapers do not help coal production very much. Comments in the newspapers on how to increase production, on how pampered the miners are, do not help coal production. There is far too much of that loose talk going on.

Mr. Cyril Bence (Dunbartonshire, East)

By armchair experts.

Mr. Hubbard

Yes. I wonder if any one of them has ever thought what he would do if he had 15 tons of coal lying outside his house on a nice smooth pavement, and had to remove it to his coal cellar. An unpleasant thought, no doubt. Perhaps his criticisms of the miners would not be so loud by the time he had got to the end of the job of removing 15 tons of coal. That is what the miners are doing in Scotland today in very difficult conditions. They are not moving coal on smooth pavements, but in narrow spaces under low roofs, where there is bad air, where it is difficult to breathe.

I would appeal to the people who seem to think that the miners do not work hard enough to consider these things, and to remember that, if the coal mining industry is so attractive to them, there is an opportunity for them in it, and we should welcome them there. I pay tribute and thanks to the miners in Scotland. We know that coal production is not as satisfactory as it could be, but the figures of production are increasing.

I regret that, although coal is a national question, the pay of the miners in Scotland is lower than it is in many places south of the Border. That is wrong. The pay and conditions for cutting and working the coalseams in Scotland should be attractive as they are for working coal-seams elsewhere. It is sad to relate that in a nationalised industry with a national wage structure different wage conditions should exist as between one area and another. That does not give much encouragement.

I do not want to develop this argument now because other Members want to take part in the debate. The coalmines in Fife have a splendid history. They have been in production a very long time. I myself have broken into old workings that were worked by monks in days gone by, and where I have come across wooden picks with steel points. The Fife coalfield, which has been worked in the past, has a splendid future, and has a great contribution to make to the economy of the country.

Indeed, the economy of the country, the standard of living of the people of the country, depend upon coal production, and Fife has a great contribution to make, and it is entitled to some assistance from the Government, from the Ministers here today, to help to overcome its problems. I hate to see it reported in the newspapers that the National Coal Board is worried about whether it will get a sufficient labour force. I am sorry it should be. If all the Departments of the Government do their jobs the Coal Board will not be worried, and will not need to be, for the coal industry will flourish, and the economy of the country will flourish, too, and the standard of living will be improved to the satisfaction of our people throughout the country.

5.27 p.m.

Mr. Walter Elliot (Glasgow, Kelvingrove)

I am sure the Committee is indebted to the hon. Member for Kirkcaldy Burghs (Mr. Hubbard) for focussing his remarks on one point, for there are so many of us who wish to speak that if—except, of course, the leaders on either side, who must and properly should express general views—we all express general views, many Members will be cut out of the debate. I shall do my best to limit myself to the old fashion of Scottish Members in Scottish debates, and keep my speech to as near 10 minutes as I can.

I am sure we all must sympathise with the hon. Member for Kirkcaldy Burghs, because he has made it clear that merely to transfer from private enterprise to collective enterprise is not necessarily to solve all our difficulties. As he has said himself, liaison between different Government Departments may be quite as difficult to secure as liaison between different forms of private enterprise. I have every sympathy with him, too, in his concern over the lack of use of the great deep water docks. Those deep water docks were, however, built originally for an export of coal that has greatly fallen off. Indeed, it is possible that the market for that export of coal no longer exists. Certainly it does not exist to the extent to which it did in the years when those great docks were built.

I wish to concentrate mostly on the fuel question in Scotland. Industrial civilisation is built on fuel, and in so far as the fuel situation is straitened in Scotland all our prospects for development fall off. It all depends upon the supply of energy available to drive the whole machine. We are, of course, in a vulnerable position in Britain, and also in Scotland, because we are relying so very much upon the oldest of the fuel sources of energy, deep-mined coal.

In the world as a whole a remarkably rapid transformation is taking place. Already coal has fallen from its position as the great primary energy producer to second place. Already, today, less than half of the world's energy is derived from coal. In the United States, our great competitor, the figure is strikingly lower; only a little over one-third of the total energy of the United States is derived from coal. Thirty-five per cent. of the United States energy is derived from coal. Thirty-nine per cent. is derived from oil. An extraordinarily high figure, 22 per cent., is derived from natural gas. It is interesting to note that in a country with such great hydro-electrical resources, only 4 per cent. of the energy of the United States is derived from hydro-electric power. But eighty-six per cent. of the energy of this country is derived from coal; and in spite of our use of hydro-electric power, a great proportion of our energy, at any rate in the immediate future, will need to be derived from coal.

I have therefore the greatest sympathy with the remarks made by the hon. Member for Kirkcaldy Burghs about the vital necessity, not only of developing new pits, but also of ensuring that new pits are adequately manned. It is a difficult task, because the development of coal in Britain, and particularly in Scotland, still suffers enormously from the fact that for 50 years it was the industrial battlefield, the cockpit of industrial disputes, and the scars are not wholly healed and the noise of the old battles has not yet wholly rolled away.

We must do our best to go forward, because unless we can utilise effectively the enormous resources which still remain to us, we shall not bridge the gap between exhaustion of those resources and the coming into play, which must be at a distant date, of the new resources of energy which are now just beginning to open up to us.

The cost of coal was discussed in the House last Friday. A very interesting quotation was read from the president of the National Union of Mineworkers about coal being too cheap. It may be so. It may be that coal in this country will have to be dearer instead of cheaper, nationalised or not. The danger of the falling off of our supplies is so great that if it is necessary to pay more for our supplies, more will have to be paid for them. This will place a heavy burden not merely upon our industries but also upon individual consumers, because, as we all know, of the complaints which we get from our constituents about the high cost of living, complaints about the high cost of coal, gas and electricity are not the least among them.

Perhaps the effect upon industry will not be as great as is generally conceived. Only 3 per cent. of the total cost of industrial products is due to the fuel bills. It is an interesting fact that the process of combustion for which we pay most in this country is the combustion not of coal but of tobacco. The tax on tobacco alone is greater than the whole value of the output of our deep-mined coal. We pay more to burn tobacco than we pay to burn coal.

Mr. M. Follick (Loughborough)

We get more duty from it.

Mr. Elliot

I leave the hon. Member to settle that with his hon. Friends. I am not sure that it will be an entirely amicable discussion.

The necessity to utilise every ounce of coal is so great that it may be necessary to enforce that ultilisation by the oldest of all methods, the price mechanism. The danger of cheap coal is that it may be wasted coal. There is no doubt that the heating systems of our houses were devised at a time when coal was available extremely cheaply, and much of our practice is to use coal in an extravagant way. We know from experience that the result of wasting coal is that the waste products descend like a rain upon the just and the unjust, killing prize cattle at Smithfield and rotting away the stonework of St. Pauls.

The danger before us lies in the fact that the standard of living of a country is almost in direct proportion to the amount of energy which it uses. The amount of energy used in India is one-fifteenth of that used in this country. With all the good will in the world, Pandit Nehru cannot raise the standard of living of his people unless he greatly increases the amount of energy available for their consumption.

The consumption of energy in the United States is about three times per head that of this country, and until we can raise the amount of energy available to our workers we cannot improve the standard of living of the whole of our people. It is a terribly formidable task. We are using some 200 million tons of coal in home production now. To bring us up to the present standards of the United States we should require to be using nearly 500 million tons. To bring us up to the standard set out in the Paley Report as the target for the United States at no far distant date, some 25 years ahead, we should need to use 1,000 million tons or its equivalent. The task is clearly impossible.

We must find other means of dealing with the problem. The first method is efficiently to use every ton of coal that we have. It has been estimated that by that means we could effect a saving of 30–50 per cent. of the coal squandered in this country. That figure may be exaggerated, although it has been given by a responsible authority, but it is certainly worth aiming at because it is a figure which can be achieved forthwith—without a greater dissipation of our national resources—by more efficient use of the coal which is raised now.

The hon. Member for Kirkcaldy Burghs described the working of the miners underground, something with which we have great sympathy. He spoke of the bad air and of the miners having to move great weights of coal. Some of that coal is moved by machinery nowadays, but still miners work under very difficult conditions. It is a terrible waste of human labour if a great proportion of what miners bring to the surface is to be used merely for the purpose of raising the temperatures of our rivers and killing the fish in them or is to take the form of waste heat thrown into the sea.

We must, then, have a larger amount of energy available in the country if we are to raise the standard of living of our people. To do that, we must make the most efficient use of the coal which is raised, In addition, we shall have to import new fuel. We shall have to import more oil, and we shall have to pay for that in the old-fashioned way by sending out exports. In that respect we should go in the direction of heavy precision machinery which we in Scotland, above all people, can build.

We shall certainly have to import a considerable quantity of oil if we are to cope with the new age and with the falling off of tonnage which has been mentioned. Lanarkshire has gone down from some 23 million tons in 1910 to about 7 million tons today, and there has been a falling off in coal production over the country as a whole. The Secretary of State said that we still have a fairly high production of coal. However, in 1951 it was 23,600,000 tons, but in 1953 it was not more than 22,823,000. That is the writing on the wall. Unless we can somehow or other bridge the gap in respect of the enormous energy consumption which is necessary in the years immediately ahead we shall not succeed in doing what we all want to do, raising the standard of living of our people.

We certainly can make a great improvement in our use of coal here. We want also to look ahead to the new sources of energy which are just beginning to come over the horizon—the atomic energy, to use a shorthand word for it, including by that all the modern developments, thermo-nuclear reactions and all the rest. In this, the Commonwealth has certain advantages which they did not have in the last great discovery of fuel, namely, oil.

All the great sources of oil are outside the Commonwealth, whereas many of the great sources of uranium lie within the Commonwealth. Canada has great deposits around Bear Lake. There has been the discovery of uranium in the waste heaps round Johannesburg, and there almost certainly exists Rhodesian uranium in the proximity of the Belgian Congo, one of the great sources of uranium production, and there are wide and rich areas in the romantically named district of Australia called Rum Jungle. All these are Commonwealth sources which have no parallel in oil production.

But we in Britain have the "know how" of this. It will be very necessary for us to develop high technical skill in the construction of new plants; because it is in the construction of these plants that the expense will lie, and it is in the efficient functioning of them that success will be found. This new atomic fuel is compact and plentiful; but the plants necessary to develop it are enormously expensive, and will remain enormously expensive. It has been estimated that to produce from atomic sources the amount of electricity equivalent to the present output of electricity in this country, would require capital expenditure of £2,000 million to £3,000 million. These are enormous sums, and far above anything which we are putting into the development of capital resources just now. These, in the case of electricity are, I think, something between £150 million and £200 million—certainly nothing like those gigantic sums.

The people who can make these new plants will be the people to whom the world will flock in the era about to open. This will not be done by carefully guarding all these secrets and pretending that they cannot be discovered in other parts of the world. The great discovery as to what the Russians were doing about the development of the hydrogen bomb was not done by some complex system of spying but by simply examining the atmosphere. We cannot keep these things in secrecy. A man sitting in Birmingham can tell what a man has done in the middle of Siberia. There is no way in which we can keep these secrets to ourselves.

We have to resign ourselves to the spread of this knowledge, but, as Kip-ling said in one of his poems, Keep them sweating and stealing a year and a half behind. We have great dangers before us in the exhaustion of the fuel reserves of our country, and we have to make sure that there is alternative fuel available before the run-off of the present fuels is complete.

This is a matter very largely of technological education. We all rejoiced yesterday to hear the announcement of the Chancellor of the Exchequer on forthcoming help to the development of technological education, and that the Technical College in Glasgow had been chosen as one of the centres—obviously not for Glasgow alone but for all Scotland.

We must make sure that in these new developments we produce proposals which appeal to the students. One of the most sinister figures given recently was the figure given by an hon. Member opposite, in the debate on Scottish education, that something over 70 per cent. of Scottish school children left our educational system as soon as they were able to get away from it. The customer is always right, and when we produce a system from which some 75 per cent. of the people try to escape at the earliest possible moment, we have produced an unsatisfactory system.

It is no use relying on general appeals to remedy a case of that kind. In the new development, we must find something which will strike home to the young. We need something as imaginative as the assault which was made upon Everest. We have to fire the imagination of the younger people, and I am sure that the people of Scotland have selected a number of individuals who are very well capable of doing that. We have the chancellors of the four universities and, if we wish, the vice-chancellors of the four universities. I would call for a conference of these four or, perhaps, these eight persons to survey this new field and, if they can, to carry out this firing of the imagination of our young people.

After all, they are a very representative group—of Aberdeen, Tom Johnston, of Glasgow, Lord Boyd-Orr, of St. Andrew's, the Duke of Hamilton who flew over Everest; and of Edinburgh, the Duke of Edinburgh himself, the youngest of them all. Because of that four and of the four vice-chancellors—I do not need to give all their names, but among them is our own vice-chancellor in Glasgow, Sir Hector Hetherington, not to say Sir Edward Appleton in Edinburgh and the vice-chancellors of Aberdeen and of St. Andrew's, who are also famous figures. If we wish to expand it there are the members or ex-members of the universities—present company always excepted—but we have in Lord Waverley a man who was closely connected with the earliest development of this new and dramatic possibility, and one whose presence would warrant the technical soundness of any advice which was given.

Miss Margaret Herbison (Lanarkshire, North)

The right hon. Gentleman's suggestion is a very good one. I think that he would be glad to extend the field to take in the head of, say, Glasgow Royal Technical College, which will be an important institution in the future.

Mr. Elliot

It is only too easy to think of ways of expanding this. I have not included the three traditional and important figures—a Socialist, a woman, and a trade unionist. I am merely suggesting these as an automatic selection. I think, certainly, that somehow or other we should make an attempt to bring home to these people the enormous transformation in which we are living just now.

We are assuredly in the presence of a discovery as great as the discovery of coal, which led to the industrial revolution—I believe, of a discovery as great as that of fire, which raised man above the level of the beasts. Let us in Scotland see to it that we put ourselves in the forefront of these new times; for our present resources in themselves are not sufficient to carry us through the dangerous shortages which we see ahead.

5.49 p.m.

Mr. James McInnes (Glasgow, Central)

I think that every hon. Member will welcome this opportunity of discussing what we may call trend and development in the economic well-being of Scotland. I know that the right hon. Member for Kelvingrove (Mr. Elliot) will forgive me if I do not follow him in the observations he has made. I certainly confess that I appreciated, as I think the whole Committee did, his most excellent contribution on the utilisation of coal and the question of technical education.

It is gratifying to learn from the Report that the output of Scottish industry continues to expand, and to note that, with only 10 per cent. of the population of the United Kingdom, Scotland is still able to produce at least 90 per cent. of the United Kingdom total of sewing machines, sugar-refining plant, spun jute and a number of other items. We are still able to produce 70 per cent. of the boilers and coal-cutting machines of the United Kingdom total, and between 40 and 50 per cent. of the ships, locomotives, carpets, linoleum, and so on, not to mention our favourite product—namely, about 95 per cent. of the whisky.

One of the bright features of the achievements in the Scottish industrial field was mentioned in passing by my right hon. Friend the Member for East Stirlingshire (Mr. Woodburn); namely, the remarkable development that has taken place in our industrial estates. I was interested to learn, for example, that we have provided 198 factories for Scottish firms employing 21,000 people. We have provided 111 factories for English firms employing 25,000 people, 22 factories for American firms employing 10,000 people, and 25 factories for Continental firms employing 5,000 people—a total of 356 factories, involving 61,000 people.

It is remarkable that of all the American firms which have settled in Britain, no less than 75 per cent. have settled in Scotland. It is not for me to assign the reasons which prompted them to do so, but I do know that they think very highly indeed of Scottish labour and its efficiency. A very pleasing feature about these firms is the fact that of all the firms that we have attracted to our industrial estates, less than 3 per cent. have found it necessary to leave the estates. Still more remarkable is the large number of firms which have made application for the extension of their factories. This surely indicates that there is a solid core of well-established flourishing industries.

We in Scotland owe a deep debt of gratitude to people like Lord Bilsland. Sir Patrick Dollan and R. A. Maclean, as mentioned by the Secretary of State and by my right hon. Friend, for their tremendous work on behalf of Scotland and Scottish industry. I must make it clear, however, that the development of these estates must be regarded in relation to Scotland as a whole. They have in no way changed the character of our economy, which is, and must continue to be, centred on our basic industries. The basic industries—those vital industries such as coal, ship-building, iron and steel, and agriculture—must continue to flourish, because on them the whole of Scotland's economic well-being depends. Had time permitted, I would have liked to deal with the need to encourage the expansion and modernisation of these basic industries, but I have no doubt that as the debate proceeds other hon. Members will take that opportunity.

I want to deal with the problems and fears expressed by many towns in Scotland, principally, as my hon. Friend the Member for Kirkcaldy Burghs (Mr. Hubbard) said, by towns which are located outwith the Development Area, towns where industrial growth has become a major problem. There are, for example, towns which are seeking industry to replace industries that have died, and towns seeking industry to stop the drift of their local populations. We have new towns which are seeking new industry. We have expanding mining areas, where we are not providing employment for the non-mining members of the family. We all must confess that very little has been done for such towns and areas.

I recognise that that is due to the fact that in the past the Government's whole influence, assistance and encouragement have been concentrated in the Development Area. I do not quarrel with that policy, because I think it was the right policy at that time, particularly when we look at it against the background of our pre-war experience and the heavily concentrated unemployment in these areas. But surely our policy in regard to the location and distribution of industry must not remain static. If we are to face up to the situation as we find it today, we must have a more flexible policy. That is what the Cairncross Report suggested.

I thought that when the Secretary of State mentioned the Cairncross Report, he would give the Committee some explanation why the Government had decided to reject it. The Cairncross Committee suggested three main objectives: first, that steps should be taken to accelerate the growth of industry in promising locations; second, to make fuller use of manpower and natural resources that are in danger of being wasted; and third, to arrest the decline of communities and the consequent waste of materials and social assets which they possess in cases where a little help might restore them to a thriving condition.

To my mind, the Cairncross Report was an excellent analysis of the industrial situation in Scotland today; it was positively a constructive approach to the problem. I should be justified, in fact, in saying that most of the industrialists of Scotland accepted the Report. It merited their approbation, and its rejection by the Government was a matter of grave concern. The Secretary of State indicated in a letter to the Scottish Council for the Development of Industry that the Government could not accept the Report, and he went on to say that we must not disturb our present policy meantime.

I ask the Joint Under-Secretary, who will be replying, whether by the word "meantime" the Secretary of State implies that it is still possible for him to go to the shelf, take down the Report, dust it and put it into operation either completely or in part. The rejection of the Report was not on the basis that it had no merit. Indeed, its rejection was determined, not by' the Scottish Office, nor by the Board of Trade or the Ministry of Supply, but by the voice of the Treasury; I do not think there is any doubt about that.

If it is still the Government's view that their industrial policy must remain static, that is altogether the wrong policy. We must have a courageous policy that will not only enable us to adopt the suggestions contained in the Cairncross Report, but will enable us and the Government to provide factories in any part of the country where the need justifies them, on similar terms to those obtaining in respect of factories provided in the Development Area. We should not only apply the Development of Industry Act to the various parts of the country where need demands it, but we must apply the Distribution of Industry Act in tackling our slum industrial problem and the overspill population from Glasgow.

The situation in Scotland is becoming critical. Our unemployment is persistently higher than the national level. Only yesterday I noticed in the OFFICIAL REPORT that in the first quarter of 1954 approvals for new factory buildings in Scotland amounted to 37, to the value of £1 million, whereas in Great Britain in the same quarter there were 612 approvals to the value of over £30 million. That means that, compared with the factory buildings receiving approval in Great Britain, Scotland is getting only one-twentieth as its share, and I should like to know whether the President of the Board of Trade or the Minister of Labour can give an explanation of those figures.

Quite candidly, I dread a trend of that kind, because it could imply that we are going back to the bad old method of having a concentration of industry in the London region, which would mean a positive drift southwards such as we experienced in the early '30s. These are ominous signs, and I hope we shall get from the appropriate Minister some information as to why factory development in Scotland has fallen to such a low level during the first quarter of this year.

I want to deal briefly with the question of slum industry. All members of the Committee are conscious of the fact that we have hundreds of small but well-established firms with good long-term employment prospects, but which are housed in dingy, dilapidated, inferior premises with no space to expand or develop. They are anxious to obtain better accommodation and they would employ more labour if they could get it. These firms are unable to finance the construction of new premises. I do not suggest for one moment that the Government should subsidise slum industry as they subsidise slum housing or the agricultural industry. What I am suggesting is that the Government should build factories on our industrial estates and offer them to these firms at an economic rent.

If a policy of that kind were pursued, it would not only provide better conditions for the workers, but it would tend to increase efficiency and produce greater productivity. It would add to their competitive powers, particularly in increasingly difficult markets. I hope that the appropriate Minister will give up his views on this very serious problem which is so bound up with expansion in industrial Scotland.

I want now to say a word or two about the overspill from the City of Glasgow. It is the only town in Scotland which has an overspill problem, and it amounts to 300,000 people. That, in essence, is precisely the same figure as the London overspill. Almost two years have elapsed since it became known that Glasgow has such an overspill, and I ask the Joint Under-Secretary of State what the Scottish Office has done about it. I know that it has monkeyed about with it. Eighteen months ago it referred the matter to the Clyde Valley Planning Advisory Committee as a matter of urgency, and that body reported in nine months suggesting the setting up of a new town at Cumbernauld. What has happened since that recommendation was made? Why all this procrastination at the Scottish Office

Let us look at the way the situation has been dealt with in London. The London overspill is 300,000 people, and I find that since 1947 no fewer than eight new towns have been established to deal with it. These new towns have an existing population in the aggregate of 98,000 people and their population today is over 200,000. Their ultimate population will be 416,000. If that can happen in London, why cannot it happen in Scotland? I think the reason is that the Scottish Office has fiddled and monkeyed about with the problem, passing it back to ad hoc bodies, and so on. In London there has been Government action and Government decision without any passing back to anyone.

I want to know from the Joint Under-Secretary of State what is preventing a decision from being taken to deal with the problem? Why cannot the Scottish Office come to a decision that Glasgow should have five or six new towns, because that is what is required if we are to solve the overspill problem. Certainly there can be no question of introducing a Town Development Act to deal with the situation, because that merely means exporting our population without making any provision for industry.

Mrs. Jean Mann (Coatbridge and Airdrie)

The Town Development Act does not mean exporting a population without industry. Its provisions definitely include a grant from the Exchequer for the development of industry and those other developments which accompany housing.

Mr. McInnes

I think my hon. Friend ought to have another look at the Act.

Mrs. Mann

I have looked at it for two years.

Mr. McInnes

I still think another look would not do any harm, because the Town Development Act lays it down quite clearly that there must be a substantial export of population. There cannot be an export to a neighbouring county. Some financial attraction is given to the receiving authority for roads and certain services, but no specific amount is mentioned. We do not know of one single authority in England which has received a penny under the Town Development Act. Therefore, it is no use to the City of Glasgow. The problem of Glasgow can only be solved—

Mrs. Mann

If I may intervene again, the Minister of Housing and Local Government has intimated that there will be a grant of £263,000 to English local authorities for this development. It is erroneous to say that, because the money has not yet been paid out, it will not be paid, because that certainly has been intimated.

Mr. McInnes

I was saying that the problem of Glasgow can only be solved by the establishment of new towns. When they are established we can apply the Distribution of Industry Act to them. There is the machine there in Scotland in the Scottish Industrial Estates to build factories, and if the Government are prepared to apply the Distribution of Industry Act there will be financial assistance just as there is in the case of the new towns because, under the Distribution of Industry Act, considerable Exchequer assistance is given. Indeed, the extent of the Exchequer assistance provided in that Act far exceeds any mythical figure laid down in the Town Development Act.

Mrs. Mann

Nonsense. The Distribution of Industry Act applies both to town development and to new towns.

The Deputy-Chairman (Sir Rhys Hopkin Morris)

Order. We cannot have a debate within a debate.

Dr. H. Morgan (Warrington)

But surely any hon. Member is entitled to ask a question?

Mrs. Mann

Perhaps I can catch your eye later, Sir Rhys.

Mr. McInnes

Like most of my hon. and right hon. Friends, I must confess candidly that I never look forward to much resulting from our debates on Scottish industry. Indeed, I am not conscious that anything eventuated from the debate last year. If I am wrong, perhaps the right hon. Gentleman will take the opportunity of letting me know what resulted from that debate. I believe this is because the extent of power and influence of the Scottish Office in regard to the location and distribution of industry in Scotland is absolutely nil; indeed, it is best exemplified by the fact that we have an array of United Kingdom Ministers on the Front Bench.

We in Scotland are dependent on the branch offices of these United Kingdom Ministers—on branch offices of the Ministry of Labour, of the Board of Trade and of the Ministry of Supply. We are also dependent upon a lot of ad hoc bodies. I do not speak disparagingly of those, nor do I despise them, because some are doing an excellent job. But all these people, all these ad hoc bodies, all the branch offices of the United Kingdom Ministries—indeed the Scottish Office itself—have absolutely no power and direction. Each and all of them must consult Whitehall before a decision is given.

What we obviously require in Scotland is a policy of effective devolution in regard to Scottish industry. It is not unreasonable to ask that conditions shall be created which will enable us to achieve, without any impediment, the maximum of which we are capable. We want to divest Whitehall of part of its power and direction, that part which relates to Scottish industry, and transplant it into the Scottish Office. This might give us the opportunity of moving the right hon. Gentleman into action that would give us some results from the labours that we exert in the House.

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

Will the hon. Gentleman explain why his party voted against the Second Reading of the Electricity Reorganisation Bill?

6.15 p.m.

Mr. J. N. Browne (Glasgow, Govan)

The hon. Member for Glasgow, Central (Mr. McInnes) started his speech on a high tone and I wrote down on my notes, "A thoughtful and informative speech dealing constructively with dangerous trends." However, I think the hon. Gentleman fell from grace a little at the end of his speech by becoming involved in an argument with his hon. Friends. Furthermore, I must stand up for the Scottish Office and inform the hon. Gentleman that it does not "monkey about" or "fiddle about" with anything.

On the other hand, it is a pleasure to follow the hon. Gentleman because he represents, as well perhaps as any Scottish Member of Parliament, what Scottish industry really means. For he is most industrious, I often see him working hard in the Library, and of all those who work hard I believe the hon. Gentleman is near the top of the list. I join with him in his sincere tribute to Lord Bilsland and the Scottish Industrial Estates and to all those who have helped to make them a success.

I want to put on the record some facts about the Whiteinch Tunnel which, as a constituency matter, should be mentioned in this debate. The twin tunnels were approved by the Glasgow Corporation as long ago as 1946 and the Glasgow Corporation Order Confirmation Act of 1948 was given the Royal Assent on 24th March of that year. On 14th September, 1949, there was a meeting in Edinburgh between the Corporation, the Secretary of State and the Ministry of Transport. They said to the Government of the day, "What about the tunnel?" and they received the answer clear and quick, "No money, sorry, no materials."

I am making no party point when I say that today times have changed, and the Clyde tunnel is number one priority of all the tunnels in the United Kingdom. Yet, from reading the papers, I have learned of rumours of a surgical operation; that we cannot afford the Siamese twins and may have to divide them because the original cost of under £3 million has become over £5 million. I hope I am wrong, but we may hear the argument that a surgical operation is desirable. We may be told that the Dartford Tunnel and the Tyne tunnel are only single ones. We may also be told that there is no serious construction difficulty in building one tunnel first and the other later. It may be argued that on 17th March, 1948, the Town Clerk of Glasgow wrote to the Divisional Engineer of the Ministry of Transport in Edinburgh that Glasgow was prepared at that time to limit the scheme to a single tunnel.

I am not impressed by those arguments. The Clyde tunnel will open up all the West of Scotland. It will alter the character of Glasgow, and who can say how many vehicles will use the tunnel when it is there? Why, under this Government, should Glasgow accept second best in anything? I am sure that the difference in cost to the Government will not be as much as £1 million and I am sure that hon. Members on both sides of the Commitee will join with me in saying to the responsible Government Departments that it is now or never for the twin tunnels and that we are going to have them if we possibly can.

Now I want to turn to Scottish industry. This debate falls into two parts: on the one hand, what the Government can do for Scottish industry and, on the other, what Scottish industry can do to help itself. The right hon. Member for East Stirlingshire (Mr. Woodburn) said that the people must save themselves in the long run, and I very much agree with that. In other words, in this debate do not let us look to the Government for too much, but let us see, however, what the Government have done. I agree with the right hon. Gentleman that the basic industries are vital—woollen goods and whisky, farming, fishing, forestry, steel and shipbuilding—but Scotland will have and must have a growing share of the brain industries of the new age.

My right hon. Friend the Member for Kelvingrove (Mr. Elliot) called them the industries of the "new time." The new time will be the time of the chemist and the electrical engineer. We must congratulate the Government on how much has been done already. No country of its size probably compares with ours in this respect. Electronics, oil, chemicals, aircraft, peat energy, atomic energy and other similar industrial developments have come into Scotland since the war. As long as we keep in the forefront of the new time, the old basic industries will back the new industries which Scotland will continue to develop.

The hon. Member for Kirkaldy Burghs (Mr. Hubbard) and the hon. Member for Glasgow, Central were both concerned and uncertain about the distribution of industry. So am I. I do not want to make any party points about the distribution of industry in Scotland, because whatever Government are in power will have a very difficult job in arriving at the right distribution of industry policy. It is difficult to formulate a policy. When the basic industries are moving, are we to say to the Government that they shall have powers of direction? I have only two thoughts to offer on this subject, neither of which, I am afraid, is a very constructive one. The first is that if we build houses—and we are building them—we shall at least give a better chance for industry to move, because the people will have houses to move into. The other is a point which I have often thought ought to be mentioned in this Chamber. I hope that as a result of mentioning it I shall not receive too many rude letters. It is that I think that Scots people are sometimes rather unwilling to travel.

Mr. Ross

Has the hon. Member seen the emigration figures?

Mr. Browne

I mean, to travel to work. Something should be said, not to criticise the Scots, but to let them realise that we in Scotland are very fortunate in our travel facilities. I have obtained from the London Transport Executive details of the average time taken by a Londoner in 1949 to go to work. On the average, it takes him from home to public transport a four-minute walk. Actual travel, including waiting for vehicles and changing vehicles, takes 33 minutes. Further public transport or a walk to his place of work takes five minutes, making a total average time from door to door of 42 minutes. I am sure that we all know how unwilling the Scots people are to move their houses even a short distance from their place of work. They do not realise that on the average in London a worker has to travel for 42 minutes. The hon. Member for Glasgow, Central said that we should move slum factories to new places. I am afraid that he would find this unwilling ness to travel one of the great difficulties in putting that idea into practice.

Mrs. Mann

Does the hon. Member not realise that the whole conception of new towns or even of the redevelopment of existing towns was a conception that eliminated travel? That is why industry and housing are the chief elements in new development.

Mr. Browne

I agree, but we must be realistic about this and if we are to have changes in the location of industry it is desirable that Scots people should realise that in other towns in this country many people must take much longer to travel to work than we in Scotland are at present prepared to do.

I should like to pay tribute to the Board of Trade and the work that it does in helping overseas trade. Those of us who have had experience of it know that the Board of Trade service in connection with exports is as good a service as any Departmental service that we have known in our lives.

I should like to mention, lastly, the "retention policy" of Government Departments in transacting business. It is becoming a habit with Government Departments to say, "We will pay, say, 90 per cent. up to completion and will leave 10 per cent. to be paid at the end of a further 12 months." This is a thoroughly bad thing for industry. Small firms will not undertake the work because their profit is tied up. This policy is causing a blockage of money right down the line. If Government Departments hold up 10 per cent. of the money for a year, firms have either to go to the bank or increase their working capital. I ask whether it is essential that this policy of retention should be so much used in relation to work given by Government Departments to British firms. The same applies to private industry.

On the subject of industry helping itself, the Secretary of State said that world markets are becoming increasingly competitive. Scotland had had to change over from a sellers' to a buyers' market in the last few years. It has done so remarkably well, but all the time prices are becoming more and more competitive. As for price reductions, I believe there is too much tendency to think that in order to reduce prices one must inevitably cut wages of staff. Too often success and profits are flowering on the floor of the good factory while losses are moulding on the shelves and in the offices.

I want to address my remarks to any Scottish management that will listen and I want to ask any managing director whether, with his hand on his heart, he can answer "Not guilty" to 10 questions which I suggest could be put to him. Are goods wasting in his store? That is, is there improper storage? Has he too much or the right capital investment tied up in his stock? Is it possible that money is being wasted or too much stock is being held. Is he making any unprofitable lines? I am sure that that will not apply to my hon. Friend the Member for Edinburgh, South (Sir W. Darling), whose views on this subject I should greatly welcome. Is he using the most modern methods for reducing fuel consumption? Is his advertising best placed? Does he really need all the forms, returns and statistics that are called for?

Then there is the elementary question: does everybody know his job from top to bottom and know for whom he is working? One finds that a great deal of efficiency is often lost through lack of clear direction. Are the Christmas presents that are given every year really necessary? How many employees use trunk calls where a letter would do? Is the firm buying correctly? If all these questions—and there are many more— were answered correctly, this would reduce expenditure and enable a firm to sell more cheaply.

I should also like to address questions to the buyers and ask them whether they are taking the course of placing an order in the cheapest market, when the cheapest price is offered by the big firms. There is a tendency to do that and a tendency for the big firms to cut prices below what they ought to be and thus cut out the little man. If the buyer goes to the big firm only he will find, if he is not careful, that before long the little man will not be there at all. Does the buyer really need all the entertainment that is spent on him? Does the buyer realise the value to himself of the firm paying promptly? Does the buyer not think that now the time has come when he can ask his supplier, instead of supplying on the basis of cost at the time of delivery, to give a fixed price so that fixed prices can go down the line and we can give fixed prices to buyers overseas?

I should like Scottish industry to take greater advantage of one of the avenues of progress of which we can be rightly proud. That is our trade and technical Press. The British trade and technical Press is without question the best in the world. It is virtually self-supporting, far more than in any other country, and it is not bought by the advertisers. It is independent, critical and authoritative. Are we in industry making full use of the technical Press? How many managing directors get the technical papers and say, "I must read this article," put the paper one one side, and never circulate it to the staff? I think the technical Press might brighten up its publications a little and make them more interesting, but we should be very proud of our technical Press.

My last point is a plea for office staffs in small offices. The average office is any or all of the following things: dirty, badly lit, badly furnished, badly seated and has bad sanitation. There is no longer any excuse for this. The average office worker spends more time in his office than at home. To my mind, the white-collared worker in the small office is the forgotten man or woman in our present industrially successful age. I would say to these white-collared workers, "Office workers, arise, and do not sit down until you have a satisfactory seat and a decent office to work in."

6.32 p.m.

Mr. Hector Hughes (Aberdeen, North)

I agree with the Secretary of State that this must necessarily be a wide debate, because Scottish economics are to a large extent influenced by the trade, industry and employment in the whole of the island of Britain. However, I shall narrow my observations to one industry and its contributory and subsidiary industries. I shall not be tempted from that narrow field by the fact that I see sitting opposite to me an hon. Member who, when in Opposition, referred to the fields of Scotland, where he thought he saw a two-headed octopus galloping over the fair fields of Scotland on a snow-white kangaroo. I shall not allow that flight of imagination to tempt me from the narrow path I have set myself.

The Secretary of State, and now his Parliamentary Private Secretary—I thought a little invidiously—presented this Report to the Committee in optimistic terms comparable to those of the Report itself. Their optimism, in my submission, is unjustified in certain spheres, because I shall submit that the Report is misleading in some important respects. When a Report is misleading in some respects, who but experts can say that it is not misleading in other respects also? I am gravely perturbed, indeed shocked, by certain omissions from this Report. This Report is a document which, annually, gives a wide survey and picture—usually accurate—of one aspect of the Scottish nation and people.

Sir William Darling (Edinburgh, South)

Unusually accurate.

Mr. Hughes

This year's Report is an exception because, unhappily, it is less accurate and less informative than usual. It is true that it has a sadder and less satisfactory tale to tell than the Reports of previous years. So, very improperly, it takes a line which gives a false impression of shipping and ship-building. It purports to adumbrate the general economic position, but it is misleading about the future of these great industries. We find in the Report a review of the main industries, the basic services, education, research and design, with appropriate appendices on industrial development undertaken years ago and on the hydroelectric schemes, which were promoted and fostered by the Labour Governments of 1945 and 1950.

Mr. J. Stuart

Promoted by the National Government.

Mr. Hughes

I said, "promoted and fostered by the Labour Governments of 1945 and 1950," and that statement is accurate. It should at once be pointed out that all these in their beginnings and developments are merely carried on from previous years. That is particularly true of ship-building, ship-repairing and shipping, upon which I shall concentrate today. Those are industries for which not only Aberdeen but other Scottish ports also are famous and have played distinguished parts.

This Report is incomplete and misleading about those industries. The condition and prospects of those industries are such that the Government in a Report such as this should not attempt to conceal the real position. On the contrary, the Government should immediately appoint a working party or a fact-finding body of experts to investigate and report on the conditions and prospects of ship-building, the shipping industry and ship-repairing.

I say this for a variety of reasons based on facts and figures which I shall give, backed by authorities which I shall quote from both sides of the industrial conference table. I shall not make a party matter of this, because it is national and international. It involves the safety of Britain in peace and in war, it bears on the feeding of our large population, it is essential for transport of men and stores, and it is a bulwark of Britain in peace and in war. Therefore it is too big a question to be a party matter; it is essential to all parties and all people.

The facts and figures and quotations from authority show that the prospects are much worse than this Report indicates; that the results may indeed be catastrophic for this country: and that Scotland in particular and Britain in general may lose their primacy as shipbuilding nations. They show that as a consequence vast unemployment may ensue and vast financial loss be sustained by this country. They show, further, that immediate, skilful and authoritative steps must be taken to rescue these industries before worse befalls.

This is urgent, and it is why I suggest such a fact-finding inquiry, which perhaps might appropriately be called, "Operation Shipbuild" so that the problems may be tackled immediately. The problems are vast, urgent and essential, involving other subsidiary problems and industries which are nation-wide, and indeed world-wide, in their ramifications. They require statesmanship of the highest order for their solution, and the Government are not applying statesmanship to them, as this Report shows. In fact, the Government are killing the prospects of these staple industries, as I shall show, and in this I am backed by practical and scientific authority.

It may seem that I am using strong language in this matter, but it is a matter of the highest importance, and I should not commit myself to it if it were not that I am in a position to cite authorities for everything I say. These problems affect not only the shipbuilding and shipping industries but also hundreds of contributory industries, millions of workers and their families and the industrial and commercial prosperity of Britain.

Scottish shipbuilding and repairing must be considered in a large way in relation to Scotland and also in relation to Britain, the Commonwealth and the world in which these industries struggle and compete for orders which are not now forthcoming for Britain. This Report is a trap for the unwary. It attempts to put a good face on these industries but fails to do so for knowledgeable people. It depicts them like a woman with lipstick, hair-do and attractive attire, but the stark and ugly facts cannot be concealed.

At the very beginning of the Report we see in paragraph 2: supplies of steel-plate were…short of the requirements of the shipbuilding industry. There was a slight increase in the tonnage of new merchant ships completed by Scottish yards… This, of course, was a carry-over from previous years, and facts, statistics and authoritative opinions show that the future is dark.

The Report admits, in a covert kind of way, that the tonnages of ships laid down and launched both declined—paragraph 159—in 1953. The Report also states: The output of the engineering trades was lower than in the previous year. My comment on that is that it is difficult to see how it could be otherwise when the steel industry, which up to 1952 was achieving all-time records, had suddenly to stand the shock of denationalisation.

It is, therefore, without surprise but with sadness and misgiving that one reads, in Chapter 10, which deals with "Iron and Steel" the pathetic understatement: Some shortage of steel plate remained; the Scottish industries principally affected were shipbuilding and ship repairing… They were indeed, unfortunately.

Again, Chapter 11, which deals with "Shipbuilding, Ship Repairing and Marine Engineering," perpetrates this understatement: Though the shortage of steel plate continued to affect shipbuilding output during 1953, there was some improvement in supplies to the industry towards the end of the year. The paragraph goes on to say: Completions of new merchant ships in Scottish yards amounted to 477,654 gross tons, 39 per cent. of the total output in the United Kingdom, compared with 454,723 gross tons, 36 per cent. of the United Kingdom total, in 1952. Launchings of merchant ships totalled 448,142 gross tons compared with 488,143 gross tons in 1952. I invite the Committee to mark that this paragraph refers to completions and launchings based, of course, upon contracts achieved in earlier years. Not a word about the dearth of new contracts, which is the problem confronting these industries today.

Certain comments must be made upon this paragraph. The ships so completed and launched in 1953 were the result of contracts won and materials made in earlier years. Those figures are satisfactory for the past and for the present, but not for the future, as the very next sentence shows. That sentence says: The tonnage of new merchant ships laid down declined from 493,253 gross tons in 1952 to 439,790 gross tons. That was in 1953. The next paragraph states: The tonnage of ships of all types completed for overseas owners was 160,614 gross tons, which represented 34 per cent. of the total output of Scottish yards compared with 40 per cent. in 1952. These point to a serious decline and, in my submission, the danger of serious unemployment in the shipyards.

This bleak, black and stormy outlook is not peculiar to Scottish shipyards; it afflicts British and Northern Ireland shipyards also. It is, therefore, important to the whole nation, important to the owners and controllers of shipyards, of steel and ironworks and all subsidiary industries, important to masters and men, important to all transport that touches shipping, important to all producers, distributors and consumers, and important, not least, to every aspect of the fishing industry, which of course requires ships, shipbuilding and ship-repairing for the carrying on of its work.

It is essential, therefore, to realise the vast extent of this decadence, to inquire why it has occurred and who is responsible, and to seek a remedy for it. This must be done by comparing the actualities of the past and present with the prospects of the future in these great and essential industries. This is part of the task to be undertaken by what I venture to call "Operation Shipbuild." which will be undertaken by the working party or the fact-finding committee for which I appeal.

Only half a century ago Britain owned half the world's shipping. In 1953, Britain's share had fallen to one fifth. Only half a century ago the world tonnage was 29 million tons gross; today the world tonnage is 88 million tons gross. Why this disparity? It is accounted, for by many unpleasant facts, including these: British shipping losses in war not yet made good in peace; foreign competition, especially from ex-enemy countries; the short-sighted Governmental policy since 1952, a peak year, and the failure—

The Deputy-Chairman

The hon. and learned Member now appears to be going far beyond this particular Vote.

Mr. Hughes

May I remind you, Sir Rhys, that the Secretary of State himself and indeed every previous speaker has treated this debate as one of wide ambit. My argument, if I may put it—

The Deputy-Chairman

One of wide ambit so far as Scotland is concerned but not so far as the world is concerned.

Mr. Hughes

I am not dealing with the whole world. I did mention it, but my submission is that the Scottish ship-build- ing industry, as indeed are other industries in this country, is closely wrapped up with the rest of industry in this island of Britain. I am supported in that by quotations from leading thinkers in this field which I shall venture to submit to the Committee. They point out the close association of Scottish ship-building with the ship-building of the rest of this island.

The fifth reason I was putting forward—I hope I am in order—is the failure of the Government—I make no party matter of this—since 1952 to realise the needs of Scottish industry; to grapple with the problem of foreign competition and to encourage in Scotland—which is part of Britain—and in Britain, ship-building and ship-repairing for home and foreign shipping interests.

This year's report of the Chamber of Shipping shows that in 1953 certain nations not including Britain, expanded their merchant fleets enormously because they received Government aid and attention. But the British Government failed to give to either the British shipyards or the Scottish shipyards the aid necessary to enable them to maintain their position in the world. The following ex-enemy expansions are spectacular. German gross tonnage increased to 1¾ million tons; the Japanese to 3¼ million tons. But not British or Scottish shipyards, ship-building or ship-repairing.

This point has been made already with great force by leading thinkers in this sphere who have intimate practical knowledge of it. They include Mr. Tom Yates, the able General Secretary of the National Union of Seamen Mr. J. C. Denholm, the President of the Chamber of Shipping of the United Kingdom; Mr. Edmund Watts, the Chairman of the Britain Steamship Company, Limited; Sir Wilfrid Ayre, in the Journal of Commerce and many others in a position to know the facts and to draw the right conclusions from them.

Put briefly, here are the chief devastating results upon the shipbuilding industry: (1) we are tending to lose our primacy in the shipbuilding industry; (2) we are not even maintaining the industry at its former standards, because of the dearth of new orders; (3) we are not making sufficient replacements of ships; (4) we are losing our ship-repairing trade, which is going abroad to foreigners; (5) we are in grave danger of unemployment if these adverse tendencies are allowed to continue instead of being tackled with knowledge, understanding and skill by a sympathetic and expert Government.

Therefore, I say once again that the urgent need of this industry is for the Government to set up a fact-finding body and implement what I have called, "Operation Shipbuild." Mr. Edmund Watts said that in 1952 there was a difference of about 5 per cent. in the price of a ship in favour of the United Kingdom, as against Scandinavia, Germany and Holland. Now the pendulum has swung the other way. Last month, at the annual meeting of the National Union of Seamen, Mr. Tom Yates said: Shipowners cannot afford to replace tonnage under present circumstances in which the tax-free allowance for depreciation is based on original cost and does not allow for the fact that replacement costs are now three or four times greater than they were. Shipowners, under the incidence of such taxation, have been faced with an almost impossible problem in replacing their assets…If British shipping is to be in a position to meet foreign competition, which will be intensified in the future from Germany and Japan particularly, and other maritime countries, it must be enabled to build up modern and efficient merchant fleets. The authoritative and widespread apprehension in every sphere of Scottish and British shipping, ship-building, trade unions, trade and commerce, is emphasised by the distress signals which have been hoisted by the trade journals. I have already quoted Mr. Tom Yates. Now I will refer to some other articles and speeches. I shall not quote them but, for brevity, mention merely the headings.

Lloyds List on 1st January, 1954, had an article headed: Dearth of orders for new ships. Warning to shipyard labour and sub-contractors. Lloyds List on 11th January, 1954, had an article headed: More aid for German shipyards additional subsidy for 50 million marks. Another article was headed: Swedish shipbuilding on credit. "The Times" of 21st January, 1954, contained an authoritative article headed: German shipping revival; anxiety follows progress. The "Financial Times" of 27th January, 1954, contained an article with the heading: Sharp fall in ship orders. Higher volume of cancellations. This note of apprehension runs through these authoritative periodicals right up to the present time.

Who and what are to blame for this decline? The answer generally given by directors on the one side and trade unionists on the other is that the Government at large are to blame, and the Chancellor of the Exchequer in particular. I will content myself with one authoritative quotation in order to prove that. The Chamber of Shipping of the United Kingdom held its annual meeting on 25th February last. At it Sir Ernest H. Murrant, a past-president, delivered a speech, on "The future of British shipping," in which he said that, a wasting disease has taken hold of the industry. He went on to say: Never again shall we be able to aspire to the position we occupied 50 years ago. The thought that haunts all shipowners is whether we shall be able to maintain our present position for long. He goes on to point out that the present Government policy prevents shipowners from setting aside finance sufficient to replace old with new ships. He points out that inflation is depriving the industry of orders and causing cancellation of orders. He adds: In 1953 the orders placed for new ships in the United Kingdom yards fell to 520,000 gross tons, of which the British share was no more than 380,000 gross tons, and against this must be set the 250,000 gross tons of previous orders which were cancelled. When it is remembered that with a gross tonnage of 18 million on the United Kingdom register, over 700,000 gross tons is necessary every year for replacement, it is disappointing from every point of view when a contract is cancelled; it is even more serious when orders are not placed. This important and authoritative speech goes on to point out that no other single industry can be counted on to earn so much net foreign currency as shipping. He describes the Chancellor's policy as "ostrich-like" and adds: The continuance of a policy which is jeopardising the future of British shipping will surely never commend itself to true statesmanship I say definitely and categorically that true statesmanship would do five things in present circumstances. First, it would find out what is wrong with British shipbuilding, devise remedies, and implement them speedily before conditions get worse and before large-scale unemployment ensues. Secondly, true statesmanship would at once set up the fact-finding committee, to which I have referred, authoritative and representative in character, with power to examine documents and witnesses and with power to make recommendations.

Thirdly, true statesmanship would act upon the recommendations of the experts instead of, as the Government do at present, obeying the arbitrary dictates of some secret and unrepresentative committee which clogs the wheels of progress. Fourthly, true statesmanship would realise that healthy and prosperous shipping, ship-building and ship-repairing industries are essential to capital and labour alike, to sailor and landlubber and indeed to the whole of our island nation. Fifthly, true statesmanship would act upon the realisation promptly and effectively for the common good.

Alas, we have no true statesmanship in this grave matter. I have shown that all sides are agreed on that fact—masters and men, capital and labour, owners and trade unionists. I hope that even at this late hour the Government will heed the advice of these experts, these authoritative practical men, and that the Government will take their reconstructive suggestions and do that to this industry which it needs for its own maintenance and for the prevention of the large-scale unemployment which is threatening.

7.2 p.m.

Mr. R. Brooman-White (Rutherglen)

The hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) has departed to a fairly substantial measure from the satisfactorily objective tone which pervaded the debate before his speech. I hope in a minute to return to that objective tone, but I must in the beginning answer one or two of the points he made.

I am not an expert on the shipbuilding industry, and it may well be that there is considerable substance in what the hon. and learned Gentleman said about the effect of our fiscal policy on new shipbuilding orders. However, when he rounds on the Government and says that they are entirely to blame, I would say, looking at the matter simply with a layman's eye, that it seems entirely illogical to single out the Chancellor of the Exchequer, as the villain of the piece. Foreign competition is unquestionably imposing very serious problems on the industry but this is both in respect of construction and repair work.

The hon. and learned Gentleman admitted that we were suffering great difficulties from foreign competition in repair work. I am open to correction, but surely the taxation policy of the Government is not handicapping our industries on repair work. If one side of the argument is valid surely so is the other. That we are losing repair work to foreign yards is not the fault of any taxation policy. That we are also losing construction orders must obviously also be due in the main to foreign competition, quite apart from any fiscal point. I do not say that alterations or improvements are not possible on the fiscal side. I am trying only to express from a layman's point of view my opinion on the logic of this altogether unfair and exaggerated attack on the Government.

Mr. Hoy

My hon. and learned Friend was dealing with the question of the subsidising of shipbuilding, in foreign countries. The hon. Gentleman cannot be unaware of the fact that on a number of occasions we have appealed to the Chancellor of the Exchequer to take action on this matter which causes unfair competition for British shipyards. That is a matter for the Government to attend to, and that is what my hon. Friend argued.

Mr. Brooman-White

I am not qualified to argue that point. All I say is that if we are losing shiprepairing work, then it is unfair to turn round and to blame the Government on the question of construction work.

Sir W. Darling

Before my hon. Friend moves on, may I point out to him that in paragraph 163 of the Report the figures about shiprepairing are given. The actual facts are that the average tonnage in hand in 1953 was 233,000 gross tons compared with 215,000 in 1952. The ship-repairing industry is doing better than it did before.

Mr. Brooman-White

Be that as it may, the second point the hon. and learned Gentleman made was that there was until recently a shortage of plates. As we all know, that held up shipbuilding production. He attributed that to the shock caused because the Government denationalised the steel industry.

If I wanted to be partisan, I would point out that the shortage of plates was due to a shortage of scrap metal. If I wanted to be partisan about the shortage of scrap metal, I should refer to certain ineptitudes of the previous Labour Administration in their negotiations with Germany about battlefield scrap. But let us leave that aside.

Mr. Manuel

What is the hon. Gentleman talking about? Do not talk nonsense.

Mr. Hector Hughes

The hon. Member for Edinburgh, South (Sir W. Darling) read out certain figures which were not at all relevant to my argument The figures I cited were all taken either from the Report itself or from authorised statistics, or from citations by shipbuilding authorities. As to the hon. Member for Rutherglen (Mr. Brooman-White), I agree entirely when he says that he is not qualified to discuss this subject. That being so, it is a great mistake for him to attempt to do so. Further, it is a mistake for him—

The Temporary Chairman (Wing Commander N. J. Hulbert)

Order. The hon. and learned Gentleman must answer the question briefly.

Mr. Brooman-White

Perhaps I might now continue my speech. The points I made, which were points made with some knowledge of the steel industry, were in reply to what appeared to me to be the lack of logic in the hon. and learned Gentleman's accusations. They were sufficient as a reply to what seemed to me to be a very partisan attempt to attach a great deal of blame to the Government for matters which would affect any Government of whatever party, and are due to foreign competition and world causes beyond our control.

The questions I want to raise are threefold. First, I wish to refer to the steel industry and to follow what the right hon. Gentleman the Member for East Stirling-shire (Mr. Woodburn) said about the basic importance of the industry to Scottish welfare as a whole. I want to raise one problem in this respect on which I hope that the Minister can give some comfort and assurance. Then I want to refer to the general proportions of industrial development as between Scotland and the United Kingdom as a whole, and then I shall deal with the distribution of industry, a point upon which the right hon. Member for East Stirlingshire and the hon. Member for Glasgow, Central (Mr. McInnes) laid great emphasis.

I do not want to go over the ground again of the extremely important development of the new Colville plant. That in itself will go a long way in the future towards ensuring us against any shortage of shipbuilding plate and so on. The general effect of it will be beneficial to Clyde navigation, to the Scottish steel-consuming industries as a whole, to employment and so on. The advantages of the development are overwhelming. The merits of the scheme in respect of the insurance which it offers and the contribution which it will make to Scotland's future are of first magnitude. I establish that in order not to give a false sense of proportion if I refer to one small difficulty on which I wish to concentrate attention.

The problem of scrap has been the great weakness of the Scottish steel industry since the war. Throughout the history of its development, the Scottish steel industry has relied largely on scrap imported from America. Owing to development in the American steel industry, that scrap has no longer been readily available. We have been in a very vulnerable position. Great stability will be given to the Scottish steel industry by the new Colville development because it will switch the Scottish industry over to the use of home-produced pigiron. Consequently, our fortunes will be largely in our own hands; we shall be the producers of our essential raw materials.

But the pig-iron production will demand a greatly increased consumption of coking coal. A figure of 600,000 tons extra has been mentioned. The scheme has, indeed, been held up because of the coking coal problem, but it has been at last possible for the National Coal Board to give an assurance that the coking coal will be available. Up to that point, it is all extremely satisfactory.

The one difficulty is the price. What price is the Scottish industry being called upon to pay for the coking coal? I believe I am correct in saying that for many years this grade of coal has been more expensive in Scotland than else where, but not very much more expensive. Before the war the difference was about Is. a ton or perhaps a little more. Now, however, not only has the price of coal in general been creeping up, but the difference between the price of the same grade of coal to Scottish industry and to industry elsewhere has widened with alarming rapidity.

In 1948 the difference between the price of coking coal to industry in Scotland and industry in Yorkshire was about 2s. 6d. I do not want to be too firm about the figures because there are so many differentiations between grades. However the difference at the beginning of 1954 was about 12s. The National Coal Board has now introduced new pricing regulations, and the difference between the price of the same grade of coke in Scotland and in Yorkshire will be about £1. Yorkshire will be the cheapest area, and the price will be increased, in comparison with Yorkshire, in Durham and elsewhere but not nearly to the same extent as in Scotland.

The move has been adverse to the fortunes of the Scottish industry. I do not know the reason for it, and I should like some clarification if it can be given. In the announcement about the new pricing structure issued in May of this year, the National Coal Board said that it had: …reviewed their policy for the pricing of coal and…that while the general basis must continue to be the inherent quality of the coal, as shown mainly by the calorific value, that basis now requires some modification.

Mr. Woodburn

Will the hon. Gentleman explain whether the difference in price is at the colliery top? Is he suggesting that the National Coal Board have a different price when the Scottish steel works buy coking coal at Durham compared with the price charged at Durham to Yorkshire firms?

Mr. Brooman-White

It is the delivery price paid by the industry when the coal arrives. Midlands industry gets comparable grades of coal about £1 per ton cheaper than the Colville plant.

Mr. Woodburn

Is not the transport factor greater in one case than the other?

Mr. Manuel

The difference is in the middleman's charges for distributing the coal.

Mr. Brooman-White

I do not want to go into the reasons for the difference, because they must inevitably be complex and varied. I merely want to point out that the difference in regional price adversely affecting the interests of Scotland has been increasing rapidly and to an alarming degree.

In their announcement, the National Coal Board said: …the Board are…further developing in the new prices a policy of relating the prices of individual classes of coal to supply and demand and of having regard to special scarcities… The Board is in a monopoly position. The law of supply and demand is a slightly dubious factor when dealing with a monopoly.

It is true that the Board was getting into difficulties earlier through selling coal simply on its quality basis and an assessment and calorific value which, in the Scottish area, meant selling at less than the cost of production. Everybody admits that a price rise is justified. I know, moreover, that the Board of a nationalised industry lives a life of its own and that it is difficult for Parliament or the Government to interfere too much in its domestic accounting, but I ask the Government to give the reason for this recent change and to assure us that if there is an undue disproportion adversely affecting Scotland it will be rectified, and at the very least any future tendency towards disproportion will be carefully watched and not allowed to go further if it can be prevented.

When one talks of the law of supply and demand, the fact that the Scottish steel industry is doing particularly well—it is producing steel cheaper than anywhere else except Australia—should not be a factor in the mind of the Coal Board to make it say "This industry is doing well. We are its only supplier, and it can afford to pay." Both a prosperous coal industry and a prosperous steel industry are necessary. We do not want the steel industry to mulct the coal industry, but we do not want a disproportionate burden placed by the coal industry on the Scottish section of the steel industry, particularly at the present moment when it has before it this essential development plan which will be of benefit to the whole welfare of our country.

Mr. Manuel

I appreciate the logic and force of the hon. Gentleman's argument that industrial coal and coking coal for industry, and particularly the steel industry, should be at the lowest possible price, but is he quoting pithead prices or are they prices on delivery to the consumers? What range of transport charges is involved, and what percentage of distribution costs to those who are acting between the Board and the steel industry is involved?

Mr. Brooman-White

I cannot answer that in detail as I do not know the distribution costs between Yorkshire and Scotland. Obviously, distribution plays a certain part in the matter. In relation to the Colville group we must obviously also remember the decline in the Lanarkshire coalfield, but that is far from being the whole answer to the recent changes. I am simply drawing attention to an essential point in a very complicated story, the increasing differential between the prices paid by Scottish industry and industry elsewhere for coking coal.

I now come to the general proportion of industrial development as between Scotland and the South. I do not want here either to give a false sense of proportion. My hon. Friend the Member for Govan (Mr. J. N. Browne) rapidly and effectively reviewed the enormous surge forward in various Scottish industries. It is necessary that Scotland should have sufficient impetus in development, not only to keep abreast of the times, but also to catch up with a very substantial leeway. Some hon. Members may have studied the recent Report upon the Scottish economy which has been issued by the Research Department of Glasgow University. It presents a rather gloomy picture. But it is obviously a true one. The Report has been prepared by eminent Scottish economists who have been objectively reviewing our national life and the questions of production, wages, income and similar matters. In the introduction. it says: The picture that emerges is one of an industrial economy that shows signs of lagging behind the rest of the country. The Report goes on to refer to the average level of wages, the average level of which is lower than in the U.K. as a whole. So also is the standard of productivity. This gives the reason why we must feel extremely sensitive about the ability of the industry not only to keep up with modern demands but even to go ahead in order to catch up the ground we lost in the past. The hon. Member for Glasgow, Central (Mr. McInnes) made reference to the reply to a recent question I put to the Government on new factory buildings and the disproportionate increase in the South as compared to Scotland. It is fair to say that in the second part of the question, it was borne out that these figures related only to one-quarter of this year, which was too narrow a period on which to draw any reliable conclusions, and it was likely that the figures in the next quarter would be better.

I refer to this matter only to come back to the point I made last year when I asked the Government whether they were in any way concerned about shortages of capital for industrial development; indeed, the Secretary of State said today that we were not spending enough on capital development in industry. Last year, I referred to the point because of statements in the report of the Clydesdale Bank saying that that financial stringency was holding up development, and that this problem was particularly serious in Scotland.

The point I was making then, and to which I come back now is that, in the light of the general position that Scotland has rather more normal leeway to make up, is there not a case for slightly more leniency in financial policy in providing capital for development in Scotland than is the case south of the Border? Can anything be done in Treasury guidance to the banks or to the I.C.F.C. on this matter? I should like to ask whether further investigation of the matter has raised any doubts in the mind of the Government, and whether, if it has, there are any practical steps they can take to help in the matter.

I come now to deal with the question of the distribution of industry within Scotland itself. I agree with a very large measure of what was said by the right hon. Gentleman opposite who opened the debate. It has become an almost annual event in my life to make a speech on the distribution of industry, and I do not want to repeat what I said last time and the time before. I am, however, strengthened in my opinions by the fact that the trend of events is showing more and more that we can afford to be a good deal more flexible in our distribution of industry policy. This is a very old story. I want to give one short quotation from the speech of the right hon. Gentleman the Member for Renfrew, West (Mr. Maclay) who said this when the Bill was first introduced: We in Scotland are disturbed about the future of our great industrial belt…Should we not be thinking…about the industrial development of the country as a whole, rather than one section? Is not this Bill really a Distressed Areas Bill rather than a true Distribution of Industry Bill?"—[OFFICIAL REPORT, 21st March, 1945; Vol. 409, c. 900.] The right hon. Gentleman also talked about the position of the county towns, the small ports and other matters brought out in more detail by the Cairncross Report issued later on. I have quoted from a 1945 speech. The Cairncross Report was 1952. The other day—13th July—"The Scotsman" said this: The Development Areas, the industrial estates, the New Towns are all projects to prove their value, but they themselves are locally restricted and concentrated. They have in themselves the seeds of a new unbalance. What is really needed now, surely, is the encouragement and development oaf existing local industry, the re-invigoration of our moribund county towns and rural centres, and with this, and dependent on it, must go a redistribution of population. And so the volume of opinion continues and gains weight with time. The Secretary of State himself has said today that our distribution of industry policy is flexible. I am convinced, however, that in present circumstances it is not flexible enough. He said also that in the building of new factories, 61 per cent, has taken place in the Development Areas which contain 56 per cent. of the population, and that this was not disproportionate. With the greatest respect, I think that at the present time it is disproportionate. For it implies the assumption that the present distribution of population is the right one, which we all know that it is not. The building of factories in these areas contributes to pegging the population where it is, in the great overcrowded groupings, rather than helping to spread it out where it can breathe.

I do not go the whole way with the hon. Member for Glasgow, Central in his comments on the Cairncross Report. I do not want to abandon the present policy, only to modify it. I thought, if I may say so, that his rather extreme statement of the case was the very sort of thing that has made the Board of Trade hesitant about moving at all, for fear that once they move from their present policy, they may well be pushed too far. But we all know that the borders of the Development Areas are arbitrary lines.

We also know that when a Government Department has built up policy and precedent on a fixed line, that line becomes rigid. In the present case the demarcation lines of the Special Areas have become a frontier between places where the Government can act and places where it cannot. I am asking only for a certain freedom of movement across these frontiers. I would like the Board of Trade to have more power in certain cases to assist certain types of industry outside the Development Areas. I suggest also that consideration should be given to the question whether it is not possible to do that without legislation.

Could not we go further with the idea of letting S.I.E. act outside the areas with capital provided through the Development Commission. That experiment may not have been very successful on the North-East Coast but, as my hon. Friend the Member for Banff (Mr. Duthie) will agree, that is a particularly difficult area. Experience there does not necessarily prove that the same machinery in a more favourable area might not work well. Equally, it might not be necessary to amend existing legislation in order to give S.I.E. powers to build factories to be let at an "economic rent" in selected places outside the Development Areas.

I ask the Government to consider the matter, and to give us some indication of what they think of the possibility that the policy which might, so to speak, be eased a little at the seams to give more freedom of movement to meet present needs. I repeat, I do not want to abandon the existing Act. It has succeeded in producing greater diversity of industry in the Development Areas, and further progress on these lines is still needed. But, in addition to diversity within the Areas, I want to see a determined effort to achieve wider distribution outside of them.

7.30 p.m.

Mr. David J. Pryde (Midlothian and Peebles)

The Secretary of State for Scotland has a great gift, a natural aptitude, for painting the clouds with sunshine. I regret that I shall have to look at Scotland from a darker angle. It is not possible, as the Secretary of State indicated, to deal with every part of the Report which we are discussing, but I do not intend to be very wide in my ramifications.

First, I must pay the Secretary of State a compliment for the candid way he dealt with ship-building, which a great national newspaper has described as "our traditional craft." The ship-building industry is suffering from the recovery of the two defeated nations in the war. Every hon. Member periodically has evidence of it. This is not the first occasion on which I have pointed out the danger from German competition. We keep an army in Germany, and that allows the Western portion of Germany to concentrate the full power of her industrial army upon competition with our industries, including that of ship-building.

The staple industry of Scotland is agriculture. All the talk by the Government about returning to a free economy produces only apprehension among our farming community. Between the two wars our economy in agriculture was subjected to the penalty of a free economy. It is said that history repeats itself, once as a tragedy and once as a farce. It was a tragedy between the two world wars; it would be a farce today. There can be no such thing as a free economy for the farming industry of Scotland. People forget that we have 11 million acres of high hill land on which it is utterly impossible to grow a root crop. England and Wales have only 5 million. We have more than double this acreage, and that indicates that our farming must take a certain form.

I question very strongly one aspect of the Government's agricultural policy. I know it is utterly impossible for agriculture to wash its face in competition with the great lands of Canada, the United States, Australia, etc. In suspending the sheep subsidy, and reintroducing the calf subsidy the Government are fashioning a policy to the detriment of one section of the community. The Government must distribute largesse to the farming community.

The Secretary of State said that the Scots were in Scotland. Well, they are not. In my 20 years as a justice of the peace for the County of Midlothian, I have accumulated information which I can offer to the Secretary of State to show where the Scots are. They are in Canada, New Zealand and Australia; they are everywhere but where they ought to be. It sticks a knife into my breast when I have to sign the papers for highly-skilled people who want to leave Scotland and go to those promised lands.

The number of regular workers in the agricultural industry of Scotland has fallen and there has been an increase in casual labour, which is a very sinister trend indeed. It is a return to the days when the farming industry had to live by casual labour because it could not pay the price. We are suffering in Scotland today from the fact that agricultural workers will not go into the isolated areas where there are no amenities. The Government are making little effort to provide those amenities.

I represent a constituency where every form of agricultural activity is in evidence, from rich horticulture to high hill farming, so I claim to know something about the subject. The Government have a responsibility to agriculture which is the basis of all economy, as all wealth springs from the land. I 'warn the Government that there will be watchful eyes on their agricultural policy for Scotland, because the farming community is alarmed and apprehensive.

I turn to the paragraphs of the Report in regard to cement. Apparently the Secretary of State is satisfied with the position of cement. I am not. Time and time again I have had to draw his attention to the serious shortage of cement in south Scotland, and especially to the fact that it was holding back every industrial project. My own constituency as well as others in central Scotland has been badly affected in this respect. We have a pioneer industry in the production of synthetic stone, which has not been afraid to branch out. I have drawn the attention of the Ministry and of the Scottish Office to this position and to the fact that we do not get adequate supplies of cement in east Scotland.

The Report says that Scotland used 1 million tons of cement last year. Very good; but it also says that only a quarter of that was made in Scotland. The rest was imported. Every time we import cement the industrial workers of this country must produce some commodity of value to pay for that importation. We are just asking too much of the industrial workers. We are doing something in the nature of exploitation. In the west, the north and the east of Scotland, as well as in Midlothian, we have ample supplies of the materials necessary to enlarge our cement industry, and yet there is nothing done.

I go on to another phase of our industrial life which has created a great deal of discussion all over Britain, the coal industry, which is the basis of our industrial life. On a previous occasion I said that coal would be king coal for another 40 years at least. The Minister of Fuel and Power was very optimistic quite recently about the development of other sources of power. I still warn him that it will be impossible in the very near future to equip all our domestic households and our industrial economy to fit in with nuclear power or any other power. We must depend upon coal for the various degrees of activity in our domestic and industrial life.

The right hon. Member for Kelvingrove (Mr. Elliot) referred to oil and made a comparison with the United States of America. There can be no comparison between the oil of the United States and that of Britain. We have little or no oil, while the United States finds it springing out of the ground, especially in Texas and California. The United States has an ample supply of oil, and her motive power is not derived immediately from coal, although her coal seams are more accessible than ours. Hers do not need a great big hole in the ground. They can be got from the side of a hill. America has the Tennessee Valley, the Horseshoe Falls, and cheap oil, but let us remember that the oil age will be very short by comparison with the coal age.

In Fife the first charter was dated 1291; in Midlothian the Newbattle charter, 1210. If any hon. Member of the Committee cares to go to the Library and to look at the Report of the Commission on British coalfields, he will see that in Midlothian there is a geological phenomenon. Nowhere in the world are there so many seams together, and there are three different types of strata. There is, first of all, Scottish main coal which goes to a great depth. On the north side of the North Esk there are the limestone measurls, and above that again and between the two branches of the River Esk there are the seven seams called floating or bastard seams. I use the word in the sense that they are replicas of the seams below.

Many men have been transferred to the coalfield. There has to be a great expansion of our steel industry in Lanarkshire. I wonder whether the Committee has considered what that means to the coal industry in Scotland. It is estimated that it takes 3½ to 4 tons of coal to smelt a ton of steel, and Lanarkshire and the west of Scotland never shipped as much coal from its ports as did the east of Scotland. The reason is quite simple; it is because Lanarkshire had all the great industries to feed—iron, steel, ship-building and factories.

Thus we always found that the east of Scotland shipped most coal, and the twin ports of Leith and Granton exported in 12 years something like 21 million tons of coal. Our coal was cheap and it was based on cheap labour. Men worked for 5s. 6d. a day. When I went to the mines wages had increased to 5s. 9d. a day. We shipped the coal, and now we are suffering from the policy that was adopted by the Government of this country. Let us remember that the first Act pertaining to coal in Scotland is an Act of 1621.

Numerous commissions have been appointed to consider the question of the coalfields. In fact, whenever a Government get into a corner they appoint a commission. It is time that another commission was appointed, because whenever I think of the coal industry in Scotland today I think of the words of the great English poet who wrote: All over the world, nursing their scars, Sit the old fighting men, broke in the wars. All over the world, silent and grim, Mocking the lilt of the conquerors' hymn. That is the position in Scotland today. According to the organ of the National Union of Mineworkers there are in the mines in Scotland today 1,080 men of over 70 years of age. There are 3,376 men of 65 years and over, and our recruitment last year totalled 5,695, our wastage 7,318, and our dead loss was 1,623.

As I once pointed out in an economic debate, we required to attract men to the industry by a certain method. There is only one method and that is as was defined by the great American economist, D. L. Leon, in 1908. He said that it was quite simple to balance manpower in any industry. All that had to be done was to offer inducement. If we are to attract the young men to the coal-mining industry, then we must offer inducements.

Much criticism has been afforded the Scottish miner for his absenteeism. I am going to give some figures tonight which will for all time, I hope, disabuse the mind of any thinking person about absenteeism in Scotland. The average number of shifts worked by men in Scotland today is 4.88 compared with 4.7 in the rest of Britain. The most recent percentage returned shows that absenteeism in Scotland works out at 9.25 as against 11.66 for the rest of Britain. The people who talk about absenteeism in the mines know absolutely nothing about the history of the industry, because 40 years ago men who lost a shift did not suffer the penalties which are suffered today. If a miner in Scotland today is unfortunate enough to be prevented from following his occupation on any of the first five days of the week, he not only loses payment for that shift, but also his bonus.

I can remember the day when it was customary to have a fortnight's holiday and to go on the booze. Whisky was cheap—3d. a glass—and beer was 2d. a pint. There was nothing to stop any young fellow going and having a nice little spree. I can remember on one occasion when the stone workers of a colliery backed the winner of the Derby at a hundred to one. That colliery was idle for a solid stricken fortnight.

The men in the Dalkeith area were well organised and on one occasion they struck for four months. In 1894 the Scottish miners struck for 17 weeks. There is a great affinity between Midlothian and Lanarkshire. The Lanarkshire miners were not so well organised at that time as they are today, but Midlothian men were well organised. They pooled their resources with the Lanarkshire men and saw to it that the women and children of Lanarkshire got a share of what was going in Midlothian.

The Lothians last year had no losses under the National Coal Board. I am going to give a few more figures which will, I believe, interest the Committee very much. Scotland lost 3s. 6¾d. a ton and the Alloa area lost 9s. 11¾d. a ton. Some people wonder why it was that Alloa lost so much. The reason is that the cost of roof supports in the Alloa area is £5 5s. 1d. a ton compared with £4 8s. 7d. a ton for the Scottish division. That means that Alloa is paying 16s. 6d. a ton more than Scotland for roof support, which is quite a lot. Alloa pays £6 2s. 6d. a ton for power, heat and light, whilst Scotland pays only £4 3s. 6d. a ton, a difference of £1 19s. a ton.

We shall need a great deal more coal if we are going to expand the steel industry. Professor R. W. Dron, a Professor of Mining at Glasgow University, pointed out in 1922 that the great thick seams of Lanarkshire were exhausted and that the centre of gravity of the coal-mining industry was swinging towards the east. That is where the calorific value of the coal is unequalled in the world.

I was glad that the hon. Member for Rutherglen (Mr. Brooman-White) spoke as he did, because I want his assistance to appeal to the Minister of Fuel and Power to answer the question raised by Abe Moffatt, the president of the Scottish miners. Abe Moffatt is an able man, and an able man for the mine workers of Scotland. I hold no brief for the political party to which he belongs and Abe knows that perfectly well, but that does not belittle his ability. He comes from the same district as I, and we used to say that the miner of Midlothian was a better man than any in the rest of Scotland. For a long time Abe Moffat has been asking, "Are we subsidising heavy industry?" I hope and trust that on Monday the Minister of Fuel and Power will be able to answer that question.

The engineering problem presented by the Lanarkshire coalfield is difficult but not insoluble. The late Mr. Mungo MacKay who laid down and organised the great Lady Victoria Colliery—New Battle colliery—would have regarded the problem as one of every-day occurrence. For 30 years I have heard leaders of political and industrial thought in Lanarkshire, thunder about the great problem created by the water-logged seams there. It is perfectly true to say that the coal will lie in pockets, and no doubt we shall be told that it is uneconomical to get—but will it be uneconomical to extract that coal? Have not mining methods been adapted and brought up to date so that, when applied they could get at the coal cheaper than we are getting at it today?

We ask the National Coal Board to do far too much, and we ask it to do far too many things. We ask it to build houses for miners, to provide welfare facilities, to provide social facilities. In so doing we place a great strain on it. And the Committee should remember that in asking the National Coal Board we are asking the miner because, as old Robert Brown, secretary of the Midlothian miners used to say, "It all comes from the point of the pick, from the point of production." The National Coal Board is the body charged with the getting of coal, and, in addition to asking it to do too much, we ask it to buy the industry. Whoever heard of the workers of an industry being asked to buy that industry and to tie this debt round their necks? That, Sir Rhys, is not democratic socialism at all, but syndicalism.

Today the National Coal Board is being ask to purchase coal in America and to bring it across the Atlantic—not to British but to French and other Continental ports. The Board is asked also to buy coal from Poland. It is then asked to sell it to industry and to the domestic consumer here at the prices at which coal got from the thick seams of Yorkshire and Staffordshire can be sold. We are asking the Board to incur a loss of at least £2 a ton. I suggest, in conformity with my colleagues in the industrial arena, who, at their last conference passed a resolution, demanding the de-watering of Lanarkshire, that if such questions as these are settled, the problem of Lanarkshire will be settled for all time.

Yesterday one hon. Member said that when emotion came in at the window reason went out at the door. There is reason for emotion when one sees good people pushed from their surroundings and their social associations and dumped, albeit in a new house but with no social amenities.

To the Ministry of Labour and to the Board of Trade I wish to devote the last few minutes. I want to charge them with having failed in their duty. Under the Distribution of Industry Act, part of Midlothian was scheduled as a distressed area. I am told that there is not much unemployment there. That is perfectly true. There is not much unemployment because the people are in industries elsewhere. The hon. Member for Govan (Mr. J. N. Browne) said that the people did not travel far to work. My hon. Friend the Member for Hamilton (Mr. T. Fraser) will answer that particular point when he speaks.

In the County of Midlothian people travel long distances. Girls from the mining districts of Midlothian, working in Peebles, Innerleithen and Walkerburn, travel 20 miles there and back. Girls in the Calder area can find employment only in Edinburgh, which is the nearest labour market. I have here the current timetable of railway trains from West Calder to Edinburgh. It means that every week that they work those girls are £1 worse off than girls who work in Leith and Edinburgh. Will the Government be prepared to subsidise the transport costs of those girls?

We were promised that we would get factories built in the western portion of Midlothian. There we have the shale industry which today is hanging by a thread. The coal reserves on the borders of West Lothian and Midlothian are rapidly being exhausted and the men there employed will have to find work elsewhere. The shale industry is a problem in any case, but I say to the Committee advisedly that it will be well for this country to nurse the shale oil industry, because I have no hope that in the event of another war with such destructive forces as the hydrogen and atomic bombs let loose, we shall get oil from across the sea.

The shale oil industry is one of the finest industries in Scotland. It produces not only rich diesel oil but many valuable by-products. What is to stop the Government erecting new plant in order fully to employ our people? In contradistinction to what the Secretary of State said, the Government can direct industry. Ferranti's, the great electrical firm in Edinburgh, were willing to build a factory in the Calder area and exploit this rich pool of female labour. Instead they were directed to occupy a factory at Dundee rendered empty because one of the firms brought to Dundee had failed. I think that it is perfectly true to say that in the last days of the last Government Dundee Chamber of Commerce petitioned the Government not to send any more ancillary industries there.

I have posed certain questions. I am very pleased to see that we have drawn Ministers from the other Departments to this important debate on industry and employment in Scotland and it will be very interesting to hear the answers given on Monday.

8.0 p.m.

Mr. Patrick Maitland (Lanark)

I greatly enjoyed the historical references of the hon. Member for Midlothian and Peebles (Mr. Pryde). I had, of course, a slight fear that he might start referring to a 17th Century pamphlet which has been my bedside reading of late, an account of Scotland's grievances by reason of the Duke of Lauderdale's Ministry. He knows as well as I that we both have a common interest in this our common ancestor.

Today we are here to plead not only Scotland's grievances, but to study and regard with foresight the possibilities of the future. I think I am right in saying that it was a Scotsman who left us the adage: If you have talents, industry will improve them; If you have but moderate abilities, industry will supply their deficiency. It is my pride and privilege to direct attention once more, as it has already been directed, to the problem of the location of industry, and in doing so I am not attempting to range myself on the side of the Cairncross Report or against it. I join with my hon. Friend the Member for Rutherglen (Mr. Brooman-White) and others on both sides of the Committee who plead with the Government for some administrative flexibility in their application of the ideas contained in that Report.

What strikes me at the moment—and I am surprised that it has not already been mentioned—is that we in Scotland should be rejoicing, and certainly should be congratulating my right hon. Friend the Secretary of State, for the fact that Scotland has acquired a new industry in the last few weeks. I refer to the announcement that Scottish Industrial Estates are to build a factory of 210,000 square feet at East Kilbride for an American firm, Sunbeam Electric, which is to give, as I understand—and it is sometimes wise to be cautious in accepting these preliminary estimates—work to some 2,000 people. Here are jobs coming to Scotland for 2,000 Scotsmen, and if what I have to say in analysis of that process may sound a little critical, it is certainly not ungrateful.

I for one—and I believe I speak for every Scotsman—am proud and pleased with whatever administrative machinery or advertising technique or public relations enthusiasm have together or separately contrived to get that factory to Scotland. But I am interested in some suggestions which appeared in a letter printed in the "Glasgow Herald" on 8th. July. This came from Mr. John Anderson, Managing Director of Messrs. James Templeton and Co. Ltd. of Glasgow. I only intend to make three quotations in my speech—although if I am too long I shall cut them to two. But I must quote this letter.

Mr. Anderson said: U.S. industries have recently been invited to come over here with the offer of subsidised factories, which Scottish Industrial Estates Ltd. provide at 1s. 6d. per square foot. We understand that earlier applicants got in at 1s. 1d. per square foot. The economic rental (as offered to us)"— that is, as offered to a Scottish firm, I wish to stress that— is 4s. per square foot. Here we have Marshall Aid in reverse. It would be interesting to learn the extent to which the taxpayer subsidises U.S. industrialists. He goes on with these germane economic reflections: The U.S. industrialist operating here is assessed for Income Tax but not for Surtax and his net income is available for export. It would be interesting to know how much they take out of the country of the profit from their operations here. Whatever that may be, it has to be compensated by corresponding exports by our own industrialists who cannot secure factory subsidies, who cannot escape Surtax, and whose net income, whether spent or saved, contributes to our internal economy. This is not a complaint. I am merely drawing attention to the fact that if we hail the arrival of a new industry or firm in Scotland, we do well to consider how permanent it may be and, while wishing it every success, we must also hope that like facilities and advantages are not denied to our own industrialists. I am hoping that when the Minister winds up there may be a reference to this point: is it or is it not true, as is alleged, that Scottish industries are not offered these S.I.E. factories at 1s. 6d. per foot but are offered them at 4s. per foot?

I wish to come back to the problems raised by the hon. Member for Midlothian and Peebles about the coalfields, but before doing so, I should like to reflect on two questions that arise out of this instance of an American factory coming to Scotland—an event which in itself we welcome so very much. That factory is coming to East Kilbride, and I am not now going to argue the question for or against new towns, although there has been a tendency to enter into that field in this debate.

The question that I want to ask is: how many houses are needed for the ancillary workers—commerce, transport, and the rest—and secondly, how many of the industrial workers who take jobs in this factory and others like it will elect to live in the new town and will therefore require houses to be built for them?

I suggest that there is an air of theoretical enthusiasm which one senses in St. Andrew's House when one seeks to discuss those questions. It would be tedious and boring to the Committee if I were to deal with the figures which I have been given on different occasions. But I would say, going by the figures that I have been given on two quite different occasions, once in a reply by the Under-Secretary of State for Scotland and on another occasion in correspondence with St. Andrew's House, I got one answer which led to the belief that, with the employment now to be expected at East Kilbride, we might need 10,000 houses, and another leading to the calculation that we might need as many as 16,000 houses.

I challenge the higher figure because, from my own experience of checking up on the spot some of the figures which the Scottish Office kindly gave, they are not always close to the facts. In one case I found an error of no less than 40 per cent., and in another case I found that only half the employees of a large factory did in fact want to come and live in the new town, although they knew that houses were available for them.

I raise that question because it is essential to realise that if there is a kind of airy enthusiasm that leads to the production of houses in the wrong place, or perhaps more than are needed there when there is more urgent need for them somewhere else, the whole operation is very costly indeed. The reason that I quoted that letter from the "Glasgow Herald," coming from a respected industrial source—Messrs. Templeton & Co. Ltd.—was to draw attention to the fact that, although we welcome the arrival of any foreign industry that brings jobs to our shores and enables our native skill and capacity to be used, nonetheless we must recognise the cost, and in doing so we must consider whether these same attractions and opportunities may not be held out at least as profitably to ourselves, and perhaps ultimately at less cost.

Having mentioned East Kilbride, it is not my intention to say anything more about my own constituency, except in passing; for I am thinking of Lanarkshire as a whole and I am trying to speak as a Lanarkshire Member of Parliament, because I am sure it will be agreed by hon. Members opposite that it is one of our prides in Lanarkshire that we get together on common problems and try, whenever possible, to adopt a united policy.

I therefore turn to the fact, first of all, that good land is being swallowed up by the subsidised concentration of industry at East Kilbride and, as the right hon. Member for East Stirlingshire (Mr. Woodburn) said in his moderate, temperate, encouraging and uplifting speech, land is our greatest asset and we must preserve it. On the one hand we have land being used where industry is concentrated, and on the other, villages or small towns which have already used up land and where the towns themselves are declining into ruin and decay. It is that ruin and decay which are my anxiety.

I can think of some towns in Lanarkshire—some in my constituency and some outside—which are composed to a substantial extent of subsidised houses, owned by the local authority, which had a 60 years' life in them when they were built and have been standing for not more than 30 years. There are 17,000 of these in north Lanarkshire alone, owned by the local authority—more than the wildest dreams propose for East Kilbride.

It may be that economic life is seeping away from some of the centres of the local authority housing that already exists. We have here a loss of the national asset and of national investment, and this is something which we must set alongside concentration of industry in less useful areas.

The past year, which has been one of great progress for Scotland as a whole, has been one of anxiety and difficulty for Lanarkshire. I remember vividly—and hon. Members opposite who represent Lanarkshire constituencies must remember equally well—the terrible sense of tragedy which we felt last December, when the Coltness foundry closed down at Newmains, leaving approximately 500 men idle. This was a serious event, which taxed all our brains, resources and ingenuity, and I cannot believe that any of us are altogether satisfied at the outcome of our collective endeavours.

Each year we have a list of collieries which have closed down. Only this week, when the Glasgow Fair Holidays begin, one more closed down—Castlehill Colliery, at Carluke—laying aside nearly 300 men. Before that there was the closure of Overton Colliery, which meant that over 140 men had to be transferred elsewhere then Canderigg, from which 140 men needed to be transferred; Headlesscross, where 78 men needed to be transferred, and Kingshill No. 2, which is on the border between my constituency and another. This is undergoing surface reorganisation which may well lead to 60 men becoming redundant for the time being, although half will no doubt be re-absorbed.

I am not mentioning this as an attack on the National Coal Board. It is true that something like 80 per cent. of these men are re-absorbed, and that of the balance of 20 per cent., some are old and some are sick. The net working loss is therefore not very great, but the human and social tragedy involved is another matter. We do not want to discourage young men from going to more profitable coalfields, but we must remember the amount of investment which has been put into these towns and will be wasted even before the lifetime of some of their houses is completed unless alternative industry is provided which can mop up the surplus mining labour. When a colliery closes money leaves the town, and when that happens everything begins to seep away.

One does not want to be unduly gloomy, but I believe that the picture of the future is worse than has generally been supposed.

Mr. Thomas Steele (Dunbartonshire, West)

I am trying to follow the hon. Member's argument as carefully as I can. Is he arguing against the location of industry in East Kilbride, in favour of a place like Carluke?

Mr. Maitland

If the hon. Member will bear with me he will have his answer later on. My point is that it is a very costly affair to subsidise the concentration of industry in the wrong place while there has been extensive social investment in other places where industry goes out of production and the towns fall into ruin.

I do not want to be unduly pessimistic, but I am bound to wonder about the future of collieries like Wilsontown at Forth, and Bankend at Coalburn, which will in due time decline. None of these events should take us by surprise, and one of my complaints is that one gets a feeling that the authorities are surprised when they do happen.

The story is quite plain. In 1915, Lanarkshire produced 58 per cent. of Scottish coal. In 1938, its production had dropped to 45 per cent. and in 1945 to 41 per cent. In September, 1946, there were 21,700 miners employed in Lanarkshire but by September, 1953, that figure had already dropped to just over 17,000.

The National Coal Board's "Plan for Coal," which dates back to 1949, gave a plain and cogent warning of the tremendous decline in Lanarkshire coalfields. The Clyde Valley Regional Plan, which has often been quoted in this House, and has been studied so much that it can almost be quoted backwards by some persons, gave warning that: By 1965 the Central Lanarkshire Basin from Shotts to Cambuslang, Hamilton and Larkhall will virtually have ceased production…In the Central Basin a 1939 figure of 4,550,000 tons of coal will fall to 350.000 tons—a 92 per cent, decline. The Lanarkshire County Council development plan, on pages 30 and 31, lists the forthcoming funerals of collieries, year by year.

It cannot be said that any Department of the Government could conceivably be taken by surprise. What did take us by surprise was the statement by my right hon. Friend the Minister of Fuel and Power in the House last Friday, which drew attention to the great part which oil is to play in our fuel resources in coming years. I hope I may be permitted to point out that Middle Eastern oil can only be guaranteed to reach these shores if the Suez Canal is held open under firm control by us.

My right hon. Friend also said that within 10 years atomic energy would make a significant contribution to our resources—I stress his word "significant." In that case we may draw certain conclusions, one of which is that electric power may well become cheaper. The National Coal Board will then be forced to cut out even sooner those sources of coal which prove more expensive, and close down more of those units which are marginal even now. The future picture is therefore worse for the coal industry of Lanarkshire than has hitherto been assumed. That being the case, we have to face the progressive and accelerated dereliction of our villages and small towns.

I had intended to make two more quotations, and perhaps I may be permitted to make at least this one. It is from a most illuminating study, Miss Hazel Heughan's "Pit Closures at Shotts and the Migration of Miners," a monograph issued by the University of Edinburgh Social Sciences Research Centre. She says, what is worth putting into the record: The lives of the majority of Shotts people are so firmly anchored to the life around them that they can admit no other and adapt themselves to no other. In the spirit of their forerunners the covenanters, they want to live their lives in their own way and would like to see other people following the particular Shotts example. But as other people are not like the Shotts people no amount of argument will make them emigrate if they do not want to do so. There is in all this not only the aspect of wasting economic assets, the roads, houses, services and so on that have been provided, but the human tragedy of trying to uproot people. My view is, therefore, that when the Board of Trade, acting through Scottish Industrial Estates, selects sites—and I think that this covers the point the hon. Gentleman the Member for Dunbartonshire, West (Mr. Steele) raised—it should be prepared to consider building subsidised factories on sites at the scattered, threatened points where industry is disappearing, and that industry should not simply be concentrated overwhelmingly in one area where what was virgin land is swallowed up.

There is, of course, the counter argument that we cannot build factories where there is risk of mining subsidence. But I believe it is true that a map was laid before the Secretary of State by Lanarkshire Members within the past 12 months showing a site at Shotts free from subsidence. The Lanark County Development plan contains a whole list of sites free from subsidence. I believe there are such sites near Newmains, Carluke and Forth.

There are those who argue—I would not attempt to endorse them—that subsidence is a fear that is overplayed. Is not the town of Bothwell kept up by hydraulic pressure? It is the case, is it not, that the pits below it, ancient tunnels, are flooded, and that the pressure of the water keeps the town up? I do not know, but the hon. Member for Bothwell (Mr. Timmons) assures me that it is.

I ask the Government to look ahead 10 years and 20 years to envisage the decline that is coming upon us and to recognise what could be done if only Scottish Industrial Estates could be brought to provide factories at these scattered places where ruin threatens. I ask that these factories should be offered to firms in crowded cities, like Glasgow, so that their production and population can overspill into those scattered menaced communities. I ask that they should be offered them on the same terms as foreign firms, and that the taxpayers' money should be put to the best advantage and to human profit. For if industry is Fortune's right hand, then frugality is her left.

8.23 p.m.

Mr. Cyril Bence (Dunbartonshire, East)

I am surprised at what the hon. Gentleman the Member for Lanark (Mr. Patrick Maitland) has said about scattering industries. There may be—I have no doubt there are—many industries that can exist in small units and be scattered about in small towns and villages. I do not know, for I have not the hon. Gentleman's experience of those. I enter this debate Las an engineer, and I shall talk as an engineer, and so, when the hon. Gentleman talks about Scottish Industrial Estates building factories scattered all over the place in this modern engineering age, let me assure him that he is completely wide of the mark and is turning the clock back 100 years.

Mr. Patrick Maitland

I was not thinking of heavy industry. I was not thinking of the sort of engineering of which know the hon. Gentleman has experience. I was thinking of small factories, such as textile factories, and of new industries, such as electronics and acoustics.

Mr. Bence

I was not speaking of heavy engineering, either. The hon. Gentleman talked about textiles. He must know that the use of nylon is increasing in textile manufactures. Engineering plays a great part in the production of nylon. I was engaged for about four years at a plant built for the manufacture of nylon. Much of the equipment for the manufacture of nylon stockings does not last because the heat quickly wears some of the components, which need replacing, and so a nylon manufacturer must be in the centre of engineering plants that make the equipment.

The problem of distributing industry in Scotland should not be considered, as the hon. Gentleman was considering it, as a Scottish problem only. My view is that that is a mistake. We have to look upon the distribution of industry not merely as a Scottish problem but a problem for the whole island of Britain. It is not just a question of getting American companies to set up industries in Scotland, or of getting firms in London or the Midlands to set up subsidiaries in Scotland. It is my view that we have to redeploy the whole industry of Great Britain. It may take 50 years to do so, but we have to start on the job.

It is not enough for the Board of Trade to ask an industrialist to build a factory here, or to tell an industrialist who wants to build a new factory that he cannot build it just where he wants to but that there are a dozen other places where he may build his factory. The time has come—though I doubt very much whether private enterprise can do it—when we must have industrial production planning just as we have town and country planning.

Let us remember the history of the Industrial Revolution. I had the honour to serve an apprenticeship in a factory built in 1796. It is a great shock to me, in these debates on Scottish industry and employment, to hear people talking about Scottish industry being decadent, to hear about people going over to America to get Americans to come here to save Scotland. It amazes me when I remember that factory in which I served my apprenticeship. It was built by James Watt and Matthew Boulton. In 1925 one of the main shops of that factory actually worked a planer turned by hand. The factory was started by Matthew Boulton. There is a wall all the way round and inside the factory ground there is a house where Boulton and Watt lived. Murdock came there and discovered how to extract gas from coal, and built his house there. Another house was built at Heathfield, where the Luddites started, and a tunnel was constructed from one house to the other. That is what Scotsmen did in starting the Industrial Revolution before Adam Smith provided its theoretical and financial basis.

Paterson also came there and originated the plan of the Bank of England. The English Parliamentarians were quite right between 1623 and 1707 in saying that if there was a union of the Crown and Parliament, we Scotsmen would run the country. Scottish engineers and commercial men laid the whole basis of Britain's commercial prosperity, yet here we are in 1954 running round the world trying to get people to come to save Scotland, the very country which started the whole thing. It is a tremendous shock to realise this.

I do not like statistics; I think that they are very dangerous things; but I see that Scotland's income is £20 per head less than that of the rest of the country and yet their savings are £2 per head more. People do not invest money in Scotland. They make it in Scotland and invest it somewhere else. [An HON. MEMBER: "James Watt."] Of course. James Watt did that.

It is time that some of these people stopped at home. I read the other day that these islands are getting top-heavy. We all pile into the south and I am not at all sure whether that is not the cause of the British Isles slipping. I think that there is some justification for trying to get some of the population back to Scotland. Where else in Europe could a workman enjoy the experience of working in a factory for four or five days a week and then, on going off on Saturday, find himself within half an hour's journey of a beauty spot like the bonnie banks of Loch Lomond?

The Secretary of State spoke of welcoming Americans and Englishmen into Scotland. He might also have thought of Welshmen. The other day I took a Welshman and his wife and two children round the House of Commons. The man is a toolmaker like myself and is employed in Scotland. I asked his wife how she liked it there; she replied, "It is grand. In half an hour we are on Loch Lomond. When we were working down south it was two hours before we could see a tree." That is wonderful and we should advertise to technicians and managers in all the southern part of Great Britain, "Come to Scotland with your skills." We should say to Scotsmen, "Come back. Loch Lomond is just as it was 100 years and more ago and we shall not allow anyone to commercialise it."

Let us advertise Scottish beauty not only to bring in tourists but to persuade Scotsmen to take employment in Scotland and to invest their money in Scottish commerce and industry. These Scotsmen who leave Scotland and invest their money elsewhere are the very ones who eulogise their country. It reminds me of my boyhood. My father was a farmer and butcher and he always thought of his animals first. If it was soaking wet or bitterly cold outside, he always made sure that the animals were fed and cared for. His affection for these creatures was wonderful and my sister and I used to say, "Yet he killed them." The more profitable they were, the more he loved them and the faster he killed them. The more profitable the work of our people to them and the more they eulogise Scotland, the faster some people leave our country.

Many hon. Members opposite, and maybe some on our side of the Committee, just will not agree with what must be the next stage if we are to get a balanced population. The ship-building industry must be prefabricated. The shipbuilding industry will go down if it is not given an opportunity to expand its area of operation. There is no doubt about that. Already in the west of Scotland shipbuilders are having prefabricated work done about 20 miles from their yards and have to import parts to their shipyards.

Anyone who has worked in a shipyard knows that when it is laid down it can only produce ships. If with shipyards we had provided prefabrication shops and the installation of machinery it could be used not only for the building of ships but, when they were not required, with the same or similar layout and the addition of presses all sorts of other commodities could be produced. I could quote an instance from my industrial life. I worked in the factory in which components were produced for a combine harvester and components for a fountain pen. It was all done in the same factory. Clips were made for fountain pens, parts for motor car bodies and components for combine harvesters. That kind of thing could not be done in ship-building yards with the old processes of manufacture, but with new processes of manufacture there would be a chance for expansion of occupation and variety of production in a prefabrication shop if the ship-building fell off a little or a great deal.

In the aircraft industry there is a wonderful opportunity for what I feel is a very important development. I do not think anyone could do this better than some Scots engineers. Not only could alloys be produced or machine tools designed and produced, but a greater conversion value from the product than that which we are inclined to get from some of the older industries could be obtained. We have been told of a shortage of raw materials. Surely British scientists, technicians and engineers should be going all out to put British craft and skill into the fashioning of raw materials into the finished product which would give us the maximum conversion value. I sincerely hope that, in the industrial development of Scotland, the scientists and technicians of Scotland will give serious help along these lines.

I could give an instance of a very wonderful machine which could be made in this country. If I mentioned the name, no one would know of it. There is another machine, one of the finest machine tools in the world, which has about the same quantity of steel in it, but while one machine costs £7,000, the other costs about £18,000. That is what I mean by the evolution of machine tools and all sorts of engineering equipment to a higher conversion value than some of the old things we used to make.

I mentioned the direction of industry. During the Industrial Revolution, in the factory of which I spoke, children started work when they were four years of age. There were no Factory Acts. There was no one to say yea or nay. I have no doubt that as soon as the Earl of Shaftesbury got busy—that factory was built in 1796—there were industrialists who said, "If you do this it will be ruin; we must have these children." But we got the factory laws to say that there must be certain conditions. Every time the social conscience has demanded certain restrictions or reservations to be put on the industrialists or factories, there has been a reaction against it and the outcry, "We shall be unable to face competition; it will be uneconomic and the country will be the loser."

The industrialist cannot now build a factory how he likes and run it how he likes, but in the main he can build it where he likes. Yet what has happened to working people and others? Town and country planning Acts have been passed, and we cannot live where we like and build houses where we like. Our shortage of land has compelled us to plan—to plan our towns and the building of houses. Yet no consideration is given to the economic problem of the man who has to live in a house in one place and has to work in another.

As my hon. Friend the Member for Midlothian and Peebles (Mr. Pryde)—the pride of Midlothian—has remarked, no one says, "We cannot build houses here because people will have to pay £1 a week in travelling expenses in order to get to their work." People are compelled to do so time and time again by the industrialist, acting under the laws of the system by which he rules. I admit that the industrialist is subject to those laws, but if we are to create a balanced community by town and country planning and town development, which is what we say we want to do, and as that will be possible only if the members of that community have work in it, surely we cannot have groups of people, whoever they may be, however idealistic they may be, running a production system tied to economic laws which ignore the social aspect of town and country planning.

To bring about a balanced community, industry must be brought within it, and where the towns are built industry must go. I say quite frankly—my hon. Friends may not agree with me—that the time has come when we cannot just ask the industrialists; we have to ensure it ourselves. Past generations have agreed to put restrictions and indeed to impose directives on industrialists as to how they shall run a factory, and this has been accepted by everybody.

The time has now come when we shall have to impose further directives—that where we decide to put a new town to which we are going to move overspill population, we shall say to factories, the owners of which say they have no room to expand, "You must go there," and if they do not want to go the Board of Trade in Edinburgh will have to step in and do it themselves. I believe that to be the stage to which we are coming.

I hope that when the right hon. Gentleman is arguing with the people in Whitehall he will tell them that the Scots people save £2 per head more than anybody else in the British Isles, but that money is not invested in Scotland. Most of it goes out. I hope that it will be invested in Scotland. I hope that when we are advertising to persuade people to come to Scotland, the managers, technicians and scientists will be told what a lovely country it is and how they can get to Loch Lomond in half an hour. Then the financiers in London will not get the managers and technicians they require unless they put them in Scotland. I have been there for only two years, and I hope I never leave.

That is the picture. There are eight million people in the Midlands in a huge conglomeration of industry. They have to travel not for 30 minutes but for over an hour, right across such cities as Birmingham and Manchester, in order to get to their work. In the north there is a beautiful country for the workers to enjoy, with raw materials, skills and crafts, and yet we have to go begging to the Board of Trade in London to utilise it for the benefit not only of Scotland but the whole of Britain and the world.

8.45 p.m.

Mr. W. S. Duthie (Banff)

This afternoon we have had a debate which has been most placid and has proceeded at an even tenor. I am sorry that at this late hour I must sound a somewhat discordant note. I find myself faced with the necessity of indulging in some plain speaking to my own Front Bench. That is something I deplore, but it has to be done if I am to fulfil my duty to my constituents and be true to my own conscience.

I shall concentrate my attention on the North-East of Scotland. That area is in a very grave position, resulting from the deterioration of the fishing industry which occurred between the wars, when the fishing fleet became depleted and we lost our foreign markets. There is a hard core of unemployment in that area which was generally recognised after the war, and even before the war. Perhaps the town of Buckie is the most hard hit of all. There we have had not only the deterioration of the fishing industry, but of all the ancillary industries as well. The money did not come in from the fishing and so there were no ropes or nets being sold nor sails and engines being repaired. The result is that we have hundreds of fishermen today who for too many years now have been acting as casual labourers on the hydro-electric schemes which we have throughout the North. These have been a godsend in providing wages for the men.

The situation was recognised as being serious in the summer of 1952. We had two visits from Ministers. The Parliamentary Secretary to the Ministry of Labour came first, and he was followed by the Joint Under-Secretary of State for Scotland. It was impressed upon them that the fundamental problem of Buckie, both from the domestic and the industrial point of view, was water. The water supply was completely insufficient for the needs of the town. It was emphasised that no possible industrial development could be contemplated and no wage earning facilities created without an adequate water supply. In the past the water supply had been adequate. The catchment area was reasonably good until it was denuded of trees during the 1914–18 war. With modern conveniences being installed, the daily consumption of water increased and the supply became completely inadequate.

There was an announcement on 29th October, 1952, by the President of the Board of Trade that the Buckie—Peterhead area, the coastline embracing Banffshire and Aberdeenshire, was to be singled out for special treatment through the Development Commission. The President of the Board of Trade should have known about the conditions in that area in relation to industrial development. If he was not personally aware of them, he should have asked his right hon. Friend the Secretary of State for Scotland. If he could not obtain the information from his right hon. Friend, he should have asked the two hon. Members in this House who represent that area, the hon. Member for Aberdeenshire, East (Sir R. Boothby) and myself. Neither of us knew anything about the statement until it was actually a fait accompli on the Floor of the House. In point of fact I was informed as I came into the Chamber at Question time that a statement would be made.

In the whole area there was, and rightly too, an upsurge of hope. The area had been singled out and nominated in the House of Commons for special treatment. The people thought that at last they would be able to do something. They incurred debts during the peak of the herring industry and they could not pay them off before that industry collapsed. Here was hope. Something was about to happen.

Buckie at once indulged in the preparations of plans for a water supply. Water had to be brought from the Spey. The Spey is about eight miles away and there is no habitation of any significance in between. There is not even a village. Water has to be brought specially. These arrangements for plans, etc., were being made with the knowledge of the Scottish Office. So it went on. Heavy expenses were incurred with engineers, and so on.

Then came the visit of Lord Bilsland and his committee. All the provosts of the North-East of Scotland were there. They met in Buckie. It was emphasised time and again at that meeting at which I was present that water was the predominant consideration in the Buckie area. Then the plans were submitted to the Treasury on 28th July, 1953, and to the Scottish Office on 5th August, 1953. These were the first completed plans.

We then had a visit from the President of the Board of Trade. We were sure then that something would be done. The President of the Board of Trade went along the coast to Buckie and Banff and other places. He spoke without committing himself, but he did not say that help would not be forthcoming. Naturally, we concluded that the promise implicit in the statement of 29th October would be carried out.

The final water plan which was to cost £138,000 for Buckie was prepared and sent to the Scottish Office and sent by them to the Treasury. As I mentioned before, it was impossible for the town to incur the debt. In capital repayment together with interest it would amount to between 7s. and 10s. in the £. I—the Member representing the constituency—was informed verbally that the plan had been put forward to the Treasury with the backing of the Scottish Office.

The town was hard-pressed for more houses, and a building programme of 200 houses was started in the expectation of adequate water being forthcoming. Repeated inquiries were made of the Scottish Office to see what was happening, and no answer was given. The town evolved a fish marketing scheme to build up some trade at the quayside for our fish workers. That scheme, which went forward with the approval of the White Fish Authority to the Development Commissioners, again was dependent upon an adequate water supply.

Today the landings in Buckie are very good. For instance, during the week ending 2nd July, 3,481 cwt. of fish were landed. There was not enough water on the quayside to enable the workers to handle the fish, and it had to go straight to the Aberdeen market. The result was that the fish workers in Buckie had nothing to do. That is the sort of thing we are up against. The White Fish Authority has a small port scheme coming along which may be practical, but Buckie cannot participate because of the water situation.

There was growing anxiety in the area, and during the Whitsun Recess I arranged with the provost of Buckie, Dr. Reid, that he should come to London to discuss the matter with the powers that be. We had a meeting with representatives of the Scottish Office, the Treasury and the Home Office, and we got a flat turn down. There is nothing doing. There is no help forthcoming.

It has been discovered only at this late hour that, because of its population of 8,000, Buckie cannot be helped. Its population is too large. I assure my right hon. and hon. Friends on the Front Bench that it will not be very long before Buckle's population is brought down to the required figure. I cannot imagine people staying in the town now that this has happened to them. But by then it will be too late.

Why should an announcement of that kind be made about Buckie and then this happen? It is little short of an outrage. I hate to have to say this, but it is true; not only are the President of the Board of Trade and the Secretary of State for Scotland involved, but so are the Government. Why should there be reference by the Government to finance in respect of an area if they were not aware of the local conditions which had to be met? As I have said, it was only on Wednesday that we knew that we could not qualify.

It makes one sick to hear about the creation of new towns where modern amenities and public utilities are provided out of public money when a splendid community like that at Buckie, which has served its country well and faithfully throughout its history, is doomed to die. It is grossly unfair and the antithesis of statesmanship that such a thing should happen.

We have been doing our best to attract new industries to other towns along the coast, but we have not been successful. We tried to attract an aeroplane industry there to utilise the aerodromes which are lying idle—our sunshine record is the best in Britain—but we failed. We tried to get British Railways to bring a wagon repair works to the area, but we failed. I want an assurance that if legislation does not exist to cope with the problem that Buckie propounds, my right hon. Friends will ensure as a matter of urgency that such legislation is put upon the Statute Book.

The Secretary of State mentioned whisky's good record. The Government ought to turn a more indulgent eye upon the whisky industry, which has achieved supremacy in the world and is continuing, with very little Government support, to earn precious dollars for us. At the moment the duty in this country is prohibitive, and we want a reduction in it if the industry is to continue to be the economic buttress to farming which it has been throughout the years.

A serious danger concerning the whisky industry relates to the decision of the Board of Trade to allow unmatured whisky—whisky under three years old; whisky which is not legal as a drink in this country—to be exported to countries which do not insist upon an age limit. This is undermining the good name of Scotch whisky.

Also, we are apt to subordinate our interests to those of foreign countries. France has recently reduced to a token her importation of whisky. She used to import whisky to the value of £168,000 a year; she has now reduced it to £8,000. Paris is one of the shop windows of the world for travellers. Yet, without a murmur, we import annually from France more than £2 million worth of brandy and wines while at the same time we allow ourselves to be diddled in this way.

I appeal to my right hon. Friends to give the Banffshire people such assurances as will restore their faith in Government declarations and statements. I assure them that the faith of the hon. Member representing that community is also badly shaken.

8.59 p.m.

Mr. J. McGovern (Glasgow, Shettleston)

I listened with interest to the case made by the hon. Member for Banff (Mr. Duthie) against the inactivity and the unsympathetic attitude of the Government towards his area. I thought we were to have another resignation from the Conservative Party. However, I advise the hon. Member to get in touch with the "Suez Committee," which evidently has greater influence with the Government Front Bench than Buckie has. Therefore, if he applies pressure from his angle in the same way as the "Suez Committee" and the 1922 Committee do, I can only say that the Prime Minister, the Chancellor of the Exchequer and most of the occupants of the Front Bench will come to the meeting in order to appease him.

I listened to his statement regarding the way in which the fishing industry is being treated, and I symathise with him in the plea he put forward. He also mentioned the need for a more sympathetic attitude towards the export of Scotch whisky, and I would say this about that subject. I have travelled a great deal throughout the world, and in every place to which I have been and in which I have seen Scots, the Scotch whisky was there before the Scots arrived, such is its popularity throughout the world.

The Secretary of State apologised because he was going out for a meal. It used to be the complaint that Members on the Front Bench were usually done out of a meal on an occasion like this, which reminds me of the story of the man who was sentenced to death. On the morning of his execution the prison governor came along to see him, and the man complained that he had not had his breakfast. When the surgeon came, the man also said, "I have not had my breakfast"; but the surgeon replied "It is not my affair." Then the executioner came and said "Are you ready?" and the man replied, "I have not had my breakfast," to which the executioner replied, "I am not here to give you your breakfast, but to see that you do not get your lunch." That is the function of the Committee in keeping Ministers in their places.

I have listened to almost the whole of this debate and I think it has been a very interesting one. It has thrown up from all corners of the Committee the problems to be faced and from which Scotland in general is suffering. I do not think any hon. Member would disagree that each and every one of us has the interests of this beautiful country of ours at heart, because on successful industry depends the life, health and well-being of our people. We would all do everything in our power to make that industry successful, and to attract people from any corner of the earth to develop our land and provide employment and happiness for our people.

When we observe the conditions around us today, and cast our minds back—at least, the oldest of us—to the years between the wars and especially the period of the '30s, when distress was rampant through our country and hunger marches, means tests, public assistance and the workhouses were the order of the day, we realise the tremendous transformation which has been made in a very short space of time from poverty and degradation to at least comfortable standards of life for most of our people.

In these circumstances, we have to take stock, as hon. Members have done today, of all the difficulties that are confronting industry. The hon. Member for Govan (Mr. J. N. Browne) said that the people of Glasgow and other towns did not care to travel very far from their jobs to their homes, but let me remind the hon. Gentleman that I know of men, and boys and girls as well, who have to travel by three different buses in order to reach their employment. When the hon. Gentleman talks of taking people more and more out into the country and there creating industries to give employment to them, in theory that is very good, but in practice it is not quite so good.

We cannot move shipyards and heavy engineering factories. Most of the heavy industries are tied down to an area. In the olden days people were housed around them, and it used to be said that the nearer they lived to their work the better it was for them, because they had more time in the morning and they could slip home for their meals. Those advantages must be set against this idea of throwing people to the outer crust of cities to live.

Before the Second World War, many people found it attractive to advocate the building of residential areas well away from the centre of the cities, but the results can now be seen. It is terrible to see men and women standing for a long time in winter, in snow, rain and cold, waiting for buses. It sometimes takes them an hour and a half to get home, and they are left with little or no leisure time. There is a gradual reaction against this kind of thing. People are beginning to demand to live reasonably near their work. We should clear away the slum areas in the centres of our cities and replace them with decent flats where people can live near their employment, and near all those things that they need for enjoyment.

That reaction is coming very steadily. Some people who are being offered houses by Glasgow Corporation are objecting to the distance they would have to travel to work. The cost of fares for three, four or five members of a family might be as much as the wage of a junior. Why should we build more and more houses in the outer districts and create such difficulties of travel? When men get home after these journeys they are in a state of anger. A long period of travel to and from work develops the worst in them. In theory it is all right to live in the outer districts, but only for people with plenty of leisure.

I am delighted that this country is on the up and up, and I shall not be niggardly about it. If our party were in power and the same position existed, we should take great credit to ourselves for it. One of the things which history will have to recall and find an answer to, and what I, as a student of the outlook of the ordinary people have never understood, is why the Labour Government, after their tremendous achievements, were thrown out of office in 1951. I do not expect hon. Members opposite to agree with that. I am prepared to give credit to any Government who carry on the policy upon which we embarked at the end of the war, as a result of which industry is being improved, employment is being maintained, satisfactory standards are being given to the people, and houses are being built.

I am delighted that this Government have built so many houses, I wish they had built 50,000 more. I am prepared to give anybody the credit for ending the misery experienced by people who live congregated together in a small space, and who never have the opportunity of a bath or of the ordinary decencies of life, and who, in fact, have almost to live the life of an animal. Therefore, to whatever Government steps up the production of houses in the country I will give full marks, both in the House and outside.

In regard to industry as a whole, I know quite well that in the past there existed the conception that to advocate increased productivity from Socialist platforms amounted almost to heresy. I am glad to say that that conception has changed to a large extent, and that today we all recognise that increased productivity can raise the standard of life and can give to people a greater amount of leisure, culture and education. Only from that source can standards really and truly be raised.

That being so, we must do all in our power to see that industry is based on a solid foundation, and that no alien elements are tolerated which try either to act as saboteurs or to prevent the working of the normal arrangements between managements and trade unions. I believe that one great error has been made in our industrial relationships. When in modern times trade unions and managements began to see eye to eye about the necessity to sit round the table together to discuss problems and settle grievances, there was gradually born in industry what is called the shop steward, and that is where the trade unions made a great mistake. In agreement with the managements, the unions should have demanded that shop stewards should be people recognised by the unions, and that no person should be in a position to use that authority for political purposes which were not to the advantage of the country.

When I read of the hundreds of thousands of days lost through stoppages in industry in Scotland, I am appalled. I think it is a scandalous thing at this stage in our progress. In my view, there is no need for strikes in industry today. In theory, there is the necessity to maintain the right to strike in some tremendous emergency, such as when an employer refuses to recognise the appropriate union and the conditions negotiated between the union and the industry.

Therefore, with the latitude that there is in the relationship between managements and trade unions we should be running on such an even keel that there should be no necessity for industry to lose a single day from any form of dispute. The large number of days which are lost in industry are lost because some people in industry find it difficult to get power, and in order to develop themselves as potential leaders of the trade union movement for political purposes they make excuses to bring people into the street—and men, of course, are often prepared to accept what they call leadership, or dictation, coming from such sources.

The trade union movement is the great safeguard of the ordinary men and women, and I am only posing this question of shop stewards because in the past I have seen how they have used that power unfairly and unjustly. I say that, in case of further difficulties arising both nationally and internationally, power should be taken out of the hands of any alien forces in any factory so as to prevent its use for other than British purposes.

There has been in industry a slowness on the part of certain employers also to recognise the right to have a good approach, a sound basis of negotiation and agreement, and round-table discussions. I speak for myself, but I think that if some of the larger industries were to initiate a system of taking either trade union people or, by agreement with the trade unions, some representatives from the workshop, on to their boards, they would provide an inspiration to this country's workers. That form of approach—perhaps some form of co-partnership between the trade unions and the employers—would have far-reaching effects in industry and would have a tremendous effect amongst the rank and file.

We all know that at present we are engaged in a terrifically keen economic struggle. Unless we can maintain a high standard of efficiency and have a recognition by the worker of his duty to carry out his work in an intelligent manner, this country could be set down to a very low level by the fact that indolent and inefficient workers were dominating the situation. I do not say that all workers are pulling their weight. I say without fear of contradiction, after 28 years of working day in and day out in the building trade, that that trade could itself give a very great lift in the production of houses. If those engaged in it were to put forward a greater effort than they are at present, they would both cheapen the rents and throw up more houses.

Straight talking is wanted from the Government, from trade union leaders and from people in the Labour movement. I read in the Glasgow "Evening News" a leader of 12th July last dealing with this country being on the up and up. It said: The Government's Socialist critics forecast falling output as soon as the Tories took office. Social services cuts, strife in industry, collapse of house-building were all included in their tale of woe. In every particular they have been proved wrong. The facts prove it. It is not true to say that responsible people in the Labour movement were anxious, because the Government had changed from one side to the other, that there should not be co-operation in industry. After all, if we believe in democracy we have to accept its decisions. If democracy does not vote the Labour Party into office but puts in the Tories, it is the working-class who do it.

Therefore, if there are any "backward throws" in this respect, we have got to put up with them until it is possible to effect a change. I, for one, think that the country was mistaken, but nevertheless, it is no use going about hammering people and saying that they are bad. The people have made the decision and we must all recognise it. Let us point out the weaknesses and injustices which exist; let us denounce that which does not appeal to the sanity of mankind, but at the same time let us go on with our tasks, for the man or woman who would try to sabotage industry for political purposes is an enemy of society and should be treated as such.

There are industrial developments that I welcome. There is, for example, this tremendous £25 million development of Colville's. I would say that they were mighty quick on the draw after the steel industry was denationalised. They were very quick in making all the arrangements for the take-over and for this development of private industry.

Sir W. Darling

They were very efficient.

Mr. George Lawson (Motherwell)

May I tell my hon. Friend that this particular scheme was mooted before the war, and the trade unions in Scotland have been strenuously pressing for its adoption ever since the end of the war?

Mr. McGovern

Yes, and I would tell my hon. Friend the Member for Motherwell (Mr. Lawson) that in 1932 in the outer Lobby, Mr. Walton Newbold, who was doing research work for the National Government, mentioned this development and foreshadowed it during that period of the depression. He said that Motherwell would be the centre of the steel industry in Scotland. My father was a steel smelter for 27 years at Beardmore's. My wife's father was a roller in a large steel mills for 35 years. My family have been connected with iron and steel certainly since I was a boy. I remember the open furnaces. I used to see my father stripped to the waist, with perspiration running into his eyes. The furnaces were hand-charged in those days, and not machine-charged as they are now. Men used to be burned and killed by it in those days.

Even though this development is in the hands of private industry, I welcome it because I think it will provide employment for a large number of people. People do not adopt tremendous antagonisms to private enterprise as compared with nationalised industries. The average worker does not think in such terms. He thinks of what is in his pay packet, what is on his plate, the price that he has to pay for the food he eats and the rent he has to pay. I am one of those who believe that an indolent and inefficient worker in private enterprise does not make a very steady worker in a nationalised industry. He does not change overnight. The only change that type makes is that, when a Labour Government come into office and we nationalise industries, he thinks there is no need to work at all.

Therefore, we have a great deal of preparation to make. Sometimes I think—and this may seem heresy—that many of our schemes were too quick. The mind was not prepared for the change. I am sorry that there were not more schemes of co-partnership with some of the workers in responsible positions, followed by a gradual change as men's minds became adjusted to the changed conditions. That is what Russia found. If people cannot be persuaded to do their jobs as a matter of principle, incentives have to be provided, and if they fail all that remains is to apply the Russian system of the lash, the knout or the whip if the men are to be made to do their best. We have to prepare the minds of the men for essential changes and teach them the duty of citizenship. We have to persuade them, in spite of the setbacks and difficulties, to go with us along the right road, in order to reach the light at the end.

I am all in favour of every effort being made to benefit industry in Scotland. I recognise the part that I played in the past in walking with the hunger marchers from Glasgow to London, when I took part in every form of demonstration, and slept on the floors of workhouses or old, disused factories and schools. I realise that a tremendous change has been effected, and I say that we should go along the road together. Let us not endanger the position by any action of ours. Let us welcome every development in industry which will put us on the proper course and bring success and prosperity to our native land. We have to see that the problems which are thrown up are tackled speedily.

Indolence in the factory is no worse than indolence in the Government. We have the right to demand that if a high standard of efficiency is to be exacted from the worker the same high standard should be maintained by every responsible Minister in the Government. Whilst I have many doubts about the actions for which this Government have been responsible, in the march forward to the goal of Scottish prosperity in industry, agriculture, fishing, education and health I am 100 per cent. with every honest man and woman who desires the well-being of our native land.

9.28 p.m.

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

We have just listened to a very sincere and, I think, moving speech from the hon. Member for Shettleston (Mr. McGovern), and I hope the Committee will allow me for a few minutes to respond to it before turning to my statistical task of dealing with employment in Scotland. I do not think that this is in any way out of order, because one of the problems facing Scotland, to which I was going to refer, is how to maintain the very high levels of employment that we have achieved in many cases in the face of difficult conditions. The hon. Member has told us how. We shall do it only if we do it together. We shall never do it if we carry on the old tradition of regarding the two sides of industry as enemies of each other; or regarding political action on the floor of the shop as being a slick and easy way to promotion in the trade unions; or a slick and easy way of putting forward the fortunes of any political party.

Mr. Hoy

I agree with what the hon. Gentleman has said, but would he agree that we ought not to have had the sabotage which was carried out by the steel bosses when the steel industry was nationalised by the Labour Government?

Mr. Watkinson

I hope that the hon. Member will not interrupt until he hears what I have to say. I was going on to say that the hon. Member for Shettleston has said some brave and sincere things about the trade union movement. Perhaps, in return, I should say one or two things about the employers. I should say—and it is as true as what the hon. Member for Shettleston has said—that, very often at least, there are bad workmen only where there are bad employers.

Let us look at the matter from both sides. It is only if employers and work-people work together, which is one of their main responsibilities, that we shall make further economic progress. I believe as sincerely in that as I believe in anything. If we cannot achieve that cooperation in this country, then we have no economic future at all. In that I am at one with the hon. Gentleman, and I believe I am also at one with every man and woman of good will in the country—whatever may be his or her political beliefs or position in life. The hon. Member for Glasgow, Central (Mr. McInnes) complained that these debates did not get us very far. However, if they lead to the expression of these views, then I think the Committee is fulfilling its historic purpose—pointing the way the people of Scotland and of these islands as a whole ought to go in facing a difficult future.

I intervene in the debate with, perhaps, a little more confidence than I did last year, because the incursion of an Englishman is at least hallowed by last year's precedent. So I do not feel this year quite so much a "wee, sleekit, cow'rin', tim'rous beastie." I am further emboldened because I have an encouraging report to make. There are no party politics in this. We can all take pride in what Scotland has done in the last 12 months, and in the facts I have to relate.

Mr. Steele

An Englishman is proud of what Scotland has done?

Mr. Watkinson

I am suitably reproved, but I am proud of being an Englishman. The hon. Member for Dunbartonshire, East (Mr. Bence) was ex-telling the virtues of Loch Lomond. I wonder if he has ever camped by the Loch, as I once did, during Glasgow's holiday week, and seen where its virtues come in?

Mr. Steele

If the hon. Gentleman will read my speech of last year, and have a meeting with the Minister of Transport and other people, that may be helpful.

Mr. Watkinson

I will certainly undertake that. It is my duty in the debate to examine the employment position and to give some facts to the Committee. We are examining employment in Scotland against the highest levels of employment ever achieved in peace-time in Great Britain. In May, 1954, we had nearly 22½ million people at work. I tried to distinguish the position in Scotland. It is difficult to do that, and to get an exact figure for Scotland, but I do not think it would be far short of 2¼ million people. This is also probably a peace-time record, and something of which we can all be proud.

Unemployment has gone down. The June figure for Great Britain as a whole was 240,000–50,000 less than it was for the previous month, and 60,000 less than it was in June, 1953. I could go on with these figures. These falls are very heavy seasonal falls. Although we do have seasonal falls at this time of year, they are heavier than the normal seasonal falls. Unemployment has gone down more. In Scotland the June figure was 51,000: a drop of over 5,000 since June, 1953.

Mr, E. G. Willis (Edinburgh, East)

How does that figure compare as a percentage with the figure for all Britain?

Mr. Watkinson

I was just coming to that in the development of the argument. I was not trying to dodge anything. Nor am I trying to induce the Committee to take a complacent attitude. There is no room for self-satisfaction because, in fact, the unemployment rate in Scotland is roughly double that in Great Britain as a whole. The figure in June was 2.4 per cent. for Scotland compared with 1.1 per cent. for Great Britain. Although 2.4 per cent. is a very good figure for Scotland, it is still, as, I think, the hon. Gentleman was trying to point out, over double the figure for Great Britain.

I want to make this clear. We are talking in this Committee in statistics, but these are numbers of men and women. It is men and women we are talking about. In these islands we cannot afford to have a lot of men and women on the scrap heap doing nothing. My right hon. and learned Friend and myself realise that in our work as well as anybody does in this Chamber.

In reply to the hon. Member for Glasgow, Central I must say that my Ministry has not a branch in Scotland but a very large organisation with very adequate and almost autonomous control. I should like to look a little more into the broader picture of employment and then try to deal with a few of the special problems of the Highlands and Islands and the North-East coast and so on.

The Government must make their first priority the keeping of as high a general level of employment as we can. That is why it is important that we have shown in these last few years that we have found a new method for bringing full employment in conditions which are quite different from those which were envisaged in the 1944 White Paper on Employment Policy. Then it was thought it could be done by financial pump-priming and manipulation of the economy. All these theories were no doubt thought to be right at that time and I do not blame our Socialist predecessors for pursuing them. As the hon. Member for Shettleston said, some were right and some were wrong, but I think we are all agreed that the conditions which Scotland and these Islands as a whole face in the world today are probably as tough and competitive as they ever were in the 1930s, or in any other difficult period in our history.

If, therefore, we have maintained full employment against that kind of background we can claim that we have fumbled on, found, or come towards, the right method of doing it. I believe that the right method is to base it not on pump-priming, or manipulation, or nationalisation, or any sort of "ism," but quite simply on economic expansion, good human relations, industrial efficiency and productivity. They must be the foundations of full employment in a difficult and tough world. The overriding priority that the Government give to maintaining full employment must be based on those things.

I think that I am in line with the Cairnross Report in saying that we must not prejudice that object too far by emergency help given to dying or difficult industries. That we must maintain the general economic level and go for the good of the whole and not concentrate too much on special cases to the detriment of that good. In a very wise, farseeing speech my right hon. Friend the Member for Kelvingrove (Mr. Elliot) only dealt with the subject of power. But on a broad canvas he touched upon this point and said that the standard of living -of a people is directly related to its power resources.

There is some hope for Scotland here. The right hon. Gentleman mentioned coal, oil and atomic power. We are sinking new coal pits—I shall come later to the difficulties in Lanarkshire—and we have great new oil refineries. In atomic power we have the first breeder-reactor station in the North, and much may come of that if it is a success. There again, I think Scotland is absolutely right to concentrate on new things and new skills. It is no good going back too much to James Watt in these days.

It is on that basis that we can take pride tonight that Scotland as a whole, although its general level is still not as high as that of Great Britain, has made as much progress as Great Britain in the last 12 months. It has not improved its position, but certainly it has not fallen back. I know of the difficulties which are to come, and they have been quite properly pointed out by several hon. Members, particularly the hon. Member for Midlothian and Peebles (Mr. Pryde), who talked about German competition in shipbuilding and other industries. There is much of that sort of thing to face.

I am sorry that I must deal with some more statistics, but that is the only way of presenting the picture. Between May, 1953, and presenting this year the estimated numbers employed in the manufacturing industries rose by 10,000; but this was offset by a drop of 5,000 in the non-manufacturing industries. It left a net rise of 5,000. In any case, the 10,000 was where we wanted it: mainly in some of the heavy plant and engineering industries.

On the general unemployment figures, Scotland had an almost unprecedented seasonal fall and the unemployment total fell between March when it was 71,000 to June when it was 51,000. That June figure was the lowest since 1951, the peak year for full employment, and was 5,000 lower than in June, 1953. The comparative rates were 2.7 per cent. in June last year down to 2.4 per cent. this June. If we take the other end of the year to give a fair comparison, we find that in January last unemployment was 72,000; this was 9,000 lower than in January of the previous year. I think that is a fairly good record. Of course, hon. Members may well say that those are not figures for the Scottish Development Areas.

Mr. Lawson

One should compare Scotland's position with that of England and Wales. For example the average position is still that one in every five workers unemployed throughout the country are Scottish. If we compare the position with the inter-war years, we find that the average was one in seven and the suggestion is that the Scottish position relative to the English and Welsh positions has become worse.

Mr. Watkinson

I do not think the hon. Member was with us last year, when I am afraid I rather dazed the Committee with statistics. I think by the time I have finished I shall have gone over every possible comparison. The comparison that I gave last year set a basis which showed that the position this year is far better than last year.

If we look at the Development Areas—I have already made a comparison with the level of unemployment in Scotland, which is double that of Britain—

Mr. Lawson

rose—

Mr. Watkinson

I cannot give way again. I have a great deal to say, and although I would like to give way to every hon. Member who wishes to interrupt, I have only a quarter of an hour in which to speak. If we look at the figures for the Development Areas, we find that last month's total unemployment figure was 32,000, which is 3,500 lower than in June, 1953. Except in 1951 it is the lowest June figure for the last five years. The January figure at 7,000 lower than last year was even as low as the January, 1951 figure. Comparative rates of unemployment in those areas were 2.7 per cent. in June and 3.6 per cent in January against 3 per cent and 4.1 per cent. at the same time last year.

Let us have a look at other areas. Here we find that the highest rate of unemployment in Development Areas is not in Scotland at all but on Merseyside. The figures are: on Merseyside in June 2.8 per cent. compared with the Scottish Development Area 2.7 per cent. If we look at one or two industries we find there was a decline in unemployment between January and June this year in all industries: mainly due to seasonal influences.

I do not need to tell the Committee that unemployment figures go down during the summer and rise to a peak in January or February, but I have given the figures for both ends of the year. The only industries which did not do so well were metal manufacturing—mainly light castings—and textiles—mainly hosiery and carpets. As to the reasons, the castings industry had a decline in home demand and in the carpet manufacturing foreign competition also played a part.

The hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) said a lot about shipbuilding. All I would say is that what shipbuilding requires at the moment is not a working party, which I think the hon. and learned Member advocated, but a rather bigger dose of what his hon. Friend the Member for Shettleston advocated. It requires greater productivity to meet what is, in some cases, I quite agree, unfair competition. But we are not in a position, and in a competitive world no one country is going to be in a position to say to its competitors. "Will you oblige us by raising your prices higher than ours?"

What we have to do is to be efficient enough, to work together enough, to brine down our costs to meet those of our competitors. I am sure that the Scottish shipbuilding industry is capable of doing that, and I think we have seen signs of that, in particular in ship-repairing.

Mr. Hector Hughes

But does the hon. Gentleman recognise that our competitors such as Germany and Japan are assisting their shipbuilding industries with regard to building and also in regard to the encouragement of orders, and that the great difficulty among shipbuilders is not the actual present but the future in that so few orders are coming in.

Mr. Watkinson

I realise that only too well. I was in Germany a few weeks ago and I am not in any doubt about the way in which the Germans are buckling down to fighting their way back into the markets of the world. I have no doubt that when our Chancellor of the Exchequer went over there he had fruitful conversations about subsidising exports, but there is a limit to which one can expect one's competitors to oblige one. When that limit is reached, the only way to meet the position is by greater competition and effort. I think the hon. Member for Shettleston realises, as more and more of us do, that that is the crux of the matter; that full employment depends on meeting the needs of our foreign customers at the prices they are prepared to pay. If we fail in that task we shall have mass unemployment in this country whatever political theory is followed, or whatever party happens to be in power.

Mr. Hector Hughes

That is what I fear.

Mr. Watkinson

This is a task which is within the power of British industry. It does not require development councils or great inquiries, but the very simple solution of people working together for the common good. That is the answer. Let us have that, and we shall not get into great difficulties.

I would say, as someone who has spent some time in the engineering industry, that we probably have not got three-quarters of our maximum efficiency and output. Ask anybody who is an expert on productivity, and he will say that it can be raised in this country by 10 per cent. in one year if we really do our job as we can. I am not disappointed or depressed in any way about the future even of the shipbuilding industry, which probably faces greater competition than any other because the boom in post-war shipping is over; the war losses are largely made up and that inevitably leads to a certain drying up of orders.

We can be more competitive in this country if we really work together. That was the message of the hon. Member for Shettleston, and that is certainly what Her Majesty's Government believe. It is not something which the Government themselves can entirely inspire; it is something in which employers and trades unionists must play their part, as they are doing in productivity councils; and not, I think, entirely in the ways advocated by the hon. Member. But I am entirely with him in his general thesis. He is quite right to point out the dangers. I am only saying that they are more quickly and efficiently met by greater productivity, greater efficiency and greater teamwork, in the shipbuilding industry, as in every other.

There are two special areas to which I wish to refer. I have great sympathy with my hon. Friend the Member for Banff (Mr. Duthie). He asked me to his constituency, and nobody could have done more when I got there to persuade me of the real needs of that area, and even in the historic task of conciliation which falls to the Ministry of Labour I will not stand between him and my other colleagues. I will say that things are not good there at the moment. I consider it right that one should say as much. The figures are not encouraging, and I am sure that the hon. Member will go on pressing the claims of that particular area. From our point of view, it is a difficult area.

The problems of Midlothian were raised by the hon. Member for Midlothian and Peebles (Mr. Pryde). The general rate of unemployment for the county on 14th June was only 1.7 per cent., which is a pretty favourable figure, So while I do not say that there is no problem, I maintain that it is not so urgent as that which exists in Buckie, for example. We will keep it under review and note what he said about the shale oil industry which is well known to our controller and his staff in Scotland.

We shall also note what he said about employment for women, though we have not found lack of such employment a great deterrent to persuading people to come to a particular area. We have not found many cases where men take the view that they will not come to an area because there is no employment for the womenfolk.

A great deal has been said about Lanarkshire, but that is balanced to some extent by the development in Fife and parts of Midlothian. None the less, here again unemployment must cause a certain amount of anxiety. In June, 1953, the rate for the county was 3.2 per cent, as compared with 3 per cent. for the whole of the Development Area. In June, 1954, the rate for the county was the same, but the rate for the Development Area had fallen to 2.7 per cent. So it is a worrying problem.

My Ministry and the Government are doing what we can to try to bring aid. I think that perhaps the Colville project is a sign towards that end and there are other projects, including the one mentioned by the hon. Member for Lanark (Mr. Patrick Maitland). If any American would come and build a factory in Scotland I should welcome him with open arms, but it is right to say that we should not put his British competitor in a different position so far as factory rental is concerned.

None the less, I should welcome American firms willing to come to Scotland. As one American said the other day, in his Scottish factory he has the best workers in any of the factories he possesses, which are located practically all over the world. He said that he could find no better workpeople anywhere than in Scotland. That is true, and I hope that it is a fact which will be borne in mind by every industrialist who contemplates building a factory in Scotland. He would not be able to get better workpeople anywhere. I say that as an Englishman, and it is a quite unbiased tribute.

Mr. Ross

Would the hon. Gentleman also advise these Americans and other newcomers who come to Scotland to absorb some of our traditions regarding the management of men?

Mr. Watkinson

That is as it may be. Very often Americans have different techniques which are sometimes successful and sometimes not. But I am sure that after they have spent some time in Scotland the atmosphere will seep into them as it does into almost everyone.

I wish to return for the moment to the broad general problem, because this problem of unemployment is, after all, one which affects the life of everyone. When I had the honour of winding up a similar debate last year, I said that above all things Her Majesty's present Government were going to make it their policy to maintain full employment. But we realise how difficult it will be under these quite new conditions, because they are quite new conditions. This country has not faced the blast of competition which we face today for almost 20 years. I think we can take some comfort tonight from the fact that we have done well in the face of rising competition. Our problem is how are we to go on maintaining this level and improving it. It cannot be done without difficulties and sacrifices both for people and of things.

For example, trade union leaders and employers must occasionally sacrifice some of what they regard as their age-old rights for the sake of working together in the common good. They must first make the industrial cake bigger before asking, at a later stage, about the size of the slice which they are to get out of it. That is a homely and simple analogy. If everybody would adopt the policy that priority number one is to increase the national output, and that only when we have satisfactorily done that should we turn to argument about how we split up the benefit, we might get on a lot faster.

Mr. William Hannan (Glasgow, Maryhill)

Does not the hon. Gentleman agree that there might be argument about how we are to increase the cake?

Mr. Watkinson

Of course. All sorts of arguments will be adduced on increasing our efficiency. That is the only way. Look at the British Productivity Council which is a good example. Its president is a leading member of the trade union movement, and its vice-president is a leading employer in one of our biggest companies. That is the way to go to work.

Mr. Hannan

On the other hand, let us look at Government action itself which, by cutting food subsidies, increased the demand for wages increases which increased the prices of our goods and thus hampered our competition in world markets.

Mr. Watkinson

I am perfectly willing to give full credit to the Government for maintaining the fullest level of employment ever obtained in peacetime in our history. If that is the result of our economic policy, then it is a very good economic policy for every man and woman in the country. We must balance one consideration with another in all these matters. The fact is that this country enjoys a level of prosperity and employment which it has never before attained.

I am not making that statement in any sense in a complacent fashion. It is something of which we all ought to be proud. It is also fair to say that perhaps it has just a little to do with the economic policy of the Government. The Government do not rest on borrowed money and the many other advantages of the immediate post-war years. We are facing a very great deal more competition than we ever faced in the years immediately after the war when we had all the benefits of a raging sellers' market. These do not obtain today.

Miss Herbison

The hon. Gentleman has made a most important statement, saying that his Government do not rest on borrowed money. Does not he know that the Government are getting a great deal of American aid through defence?

Mr. Watkinson

I did not say that. I said that my Government are perfectly happy to rest on the reputation of having created the highest level of employment ever enjoyed in this country. I said that in doing that—I was not making any special point out of it—we did not have the benefit of £1,000 million of American aid or a raging sellers' market. We did it in rather more difficult conditions.

Mr. Hubbard

I do not want to spoil the hon. Gentleman's argument, but I should like to point out that the money we borrowed equipped industry up to the point of production which we now enjoy.

Mr. Watkinson

I am very glad that the hon. Gentleman said that, because that is exactly the note on which I want to conclude. If I have created a little argument I think that the hon. Lady the Member for Lanarkshire, North (Miss Herbison) will agree that I was led into it by hon. Members on the back benches. Let me close on the note struck by the hon. Member for Shettleston and say—

Mr. Thomas Fraser (Hamilton)

This place was built for political argument.

Mr. Watkinson

Yes, but the Ministry of Labour tries to please both sides. I end by saying that we can all take pride in what we have done. It is right for me to say that, because we are responsible for governing the country at the moment, and if what we have done has helped towards maintaining a high level of full employment, I think that we can all be proud of it. I do not see that there is any party political matter in that. Our great difficulty is in knowing how to maintain it. That is something to which the Government and the country must give close and continuing attention in the months and years to come. We can take pride in what we have done.

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.