SCOTLAND (INDUSTRY AND EMPLOYMENT)

HC Deb 10 July 1958 vol 591 cc591-717

3.45 p.m.

Mr. James H. Hoy (Edinburgh, Leith)

I beg to move, to leave out from "That" to the end of the Question and to add instead thereof: this House, having considered matters relating to industry and employment in Scotland, takes note of the provision made for this purpose in the Estimates for the current year. About seven years ago, the Opposition decided to have a two-day debate on industry and employment in Scotland. Each succeeding year this debate has been held. Occasionally, we have been accused of painting too black a picture of Scotland's prospects, but what we have sought to do throughout these years has been to concentrate the attention of the House and of the Government on Scotland's economic position.

If ever a debate was necessary, it is this one today, because the position in Scotland is, indeed, bleak. Let us remember that Scotland's post-war unemployment rate has, on average, always been about twice that of the rest of the country. That has gone on since the end of the war, despite the fact that we have had Development Areas, advance factories, and special areas. One hesitates to think what would have been the position today had we not, in the early years following the war, devoted so much of our national income to the creation of our industrial estates, under the very wise guidance of the late Sir Stafford Cripps.

It is, perhaps, only right at this time to pay tribute to one who had to suffer a fair amount of abuse because, rather than spend the nation's income on consumable commodities, he preferred to take the hard road, and to invest in our industrial future. So, today, there are thousands of men and women in employment in Scotland who would otherwise have been signing on at the employment exchanges. Today, the position and prospects of Scotland are the bleakest that they have been since the end of the war. One does not want to exaggerate the conditions, but I am bound to say that they are causing concern all over Scotland, and the reasons for this concern are obvious.

First, let us look at the latest unemployment figures. I want to make it perfectly clear that I have taken the figures for May of each year since the end of the war. The Minister of Labour issued the new figures only yesterday, I think, but even if we took those, there is such a very slight alteration as compared with the previous month that they do not materially affect the position in Scotland.

In May of this year 77,500 people were registered in Scotland as being unemployed. This is 22,500 more than the total at the same time last year. These figures become all the more alarming when it is realised that they represent rather more than 17 per cent. of the total unemployment rate in Great Britain, while Scotland has only 10 per cent. of the insured population. In other words, of the unemployed in Great Britain, one-fifth are in Scotland.

When the figures are further analysed they give cause for still greater concern, because, of that number, rather more than 40,000, that is, more than half of our unemployed population, have been unemployed for more than two months. If this proves anything at all, it proves that this is not seasonal unemployment but a general debility in Scotland's employment.

In addition, we must take into account the number of people on short-time working. Although these figures are not recorded in the Ministry's return, I have, in the last two days, found out what they amount to. I think that the whole House will find them rather staggering. On 24th May this year, there were nearly 16,000 people in Scotland working short time, compared with 5,700 twelve months ago. The numbers on short-time working in Scotland today are three times greater than they were a year ago, and they must be considered in addition to all those unemployed. It is a desperate plight in which we find ourselves today.

Moreover, I regret to say that in some of our basic industries like steel and heavy engineering, we find a serious situation. In the building trades, for example, on which so much of our prosperity depends, there are two and a half times the number of building tradesmen, not labourers, unemployed that there were a year ago. Again, if this means anything at all, it means that the outlook for Scotland will become worse.

The insured population in Scotland has increased much less than it has in any other part of the country. It is sometimes overlooked that very many people have migrated from Scotland since the end of the war. Taking the figures for immigration and emigration, we find that, during the last ten years, Scotland has lost 50,000 of her people. They have been driven out of the country in an endeavour to find work. This is a bad thing and Scotland will not tolerate it. I used the figure 50,000 with reference to workers, but, as I hear my hon. Friend the Member for Hamilton (Mr. T. Fraser) remind me, with those workers go also their families, which makes the position that much worse. We in Scotland regard this form of export as a most unsatisfactory way of dealing with Scotland's unemployment situation. That view was supported by the Controller of the Board of Trade in Scotland who, in evidence before the Select Committee as long ago as April, 1955, said, in dealing with questions about Development Areas and areas outside: We do not regard the export of 6,000 to 8,000 people a year as a satisfactory way of dealing with the unemployment problem. That was said for the Government Department itself.

As I have said, we must emphasise that the present situation is not the result of seasonal factors. There is a general decline in Scotland, not confined to pockets of unemployment in certain areas. I shall not take up the time of the House by enumerating all the factories which have closed down in recent months.

The Secretary of State will remember the deputation I led to him as chairman of the Scottish Parliamentary Labour Party's Industry and Employment Group. We then enumerated to him all the factories which were closing down in Scotland, covering the textile industries of Fife and the Borders, brickworks, farming machinery in Ayrshire, the general decline of industry in Midlothian, all this being in addition to the appalling situation which is developing in Dundee, Greenock, the constituency of the hon. Member for Caithness and Sutherland (Sir D. Robertson), and at Stornoway, not to mention the awful plight which has come to Lanarkshire and the industrial belt of Scotland.

To add a word about my own constituency, I regret to say that the trouble has spread to the Burgh of Leith, where that very old-established British firm, British Oil and Cake Mills, has given notice to close its works and discharge the 150 people employed there. The Government's policy for the fishing industry, also, certainly does not bring any cheer to the substantial numbers engaged on that industry who live within the borders of my constituency.

What action have the Government taken during this period? One of the factors responsible for our present situation has been their policy of credit squeeze and high interest rates, which has borne particularly hard on Scotland and has meant not only that we have been unable to attract new industry but that industries already established in Scotland have closed after finding themselves unable to carry on.

The Government have done other things, apart from that kind of indirect action, which have greatly aggravated matters. I do not want to examine all that they have done too intimately, but, in opening the debate, it is right for me to remind the House that, in the past month, we have had Government action resulting in the closing of the naval base at Invergordon, the threat of imminent close of the Donibristle naval yard, the same at the naval torpedo factory at Greenock, and the serving of notice upon, and closing of the Royal ordnance factories. These things have meant considerable unemployment, and what we resent bitterly in Scotland is that the Government have done them without taking any steps to provide alternative employment for the people put out of work thereby.

Only recently, during the debate on the Finance Bill, the Chancellor of the Exchequer made it perfectly clear that he had no intention of doing anything to save the shale oil industry of West Midlothian. When this was brought to the notice of the Secretary of State for Scotland, very sharply, if I may say so, the right hon. Gentleman said that he just did not understand what my hon. Friends the Member for Hamilton and the Member for Edinburgh, East (Mr. Willis) were getting at. He said that the Chancellor did not say it.

I wish to remind the House that what the Chancellor said was: The best solution in the long term is to do, first, what I understand is being done at present, cut out the least productive sections of the industry"— At that point, an hon. Gentleman rightly interjected, "There will be none left"— and, in the longer term, to help in every way we can to encourage new industries to come to the area to absorb those people for whom this industry cannot any longer provide employment."—[OFFICIAL REPORT, 2nd July, 1958; Vol. 590, c. 1462–3.] I think that he was quite clearly saying that the Government had written off this industry. His words could have no other meaning. When considering the description given to this industry by the Chancellor of the Exchequer, I cannot understand why he came to that decision. In column 1461 he said: I recognise, straightaway, that this industry has been the mainstay of employment in West Lothian."—[OFFICIAL REPORT, 2nd July, 1958; Vol. 590, c. 1461.] If he really believed that, why did he not take action to preserve the industry? Why did he hand out its death warrant? I regret that on occasions such as that, and in view of the importance of this old industry to Scotland, hon. Members opposite did not show their disapproval of the Government's action. Here, I pay tribute to the hon. Member for Caithness and Sutherland and the hon. Member for Fife, East (Sir J. Henderson-Stewart). They at least showed their disapproval by abstaining in the Division Lobby, but, as for those who did vote, they tripped through at the behest of the Whip. So their signatures as well as that of the Chancellor of the Exchequer are on the death warrant for the shale oil industry in West Lothian.

Let Scotland clearly understand who made the decision. It was made not only in opposition to those who sit on these benches, but was made in spite of a decision made by the General Assembly of the Church of Scotland only in May this year. I should like to remind the House of the Report of the Committee on Church and Nation of The Church of Scotland. This is the deliverance that was adopted: The General Assembly, concerned at the increase in unemployment in Scotland, and especially at the serious risk of further unemployment in the Shale Oil Industry and the insecurity hanging over those engaged in it, urge upon H.M. Government the desirability of taking steps to protect and save from extinction this long-established and progressively-run Scottish industry, whether by remission of the tax on home-produced diesel oil or by other means. That, surely, is a clear and explicit call not only from those who sit on these benches, but from those who represent the Church of Scotland. Indeed, perhaps the General Assembly intended to make that deliverance when the Secretary of State was present, but for some unknown reason he turned up 24 hours late and was unable to hear about it. In case it has not been drawn to his attention, I draw it to his attention this afternoon.

What of the future, because that is what we have to consider today? We have to consider how we propose to tackle this problem and what it is. It causes concern not only to my colleagues on these benches, but to people throughout Scotland. Indeed, one has only to look at an article by the Industrial Correspondent of the Edinburgh Evening News. This is what he said was the prospect for Scotland in the years ahead: Registrations of building trade apprentices in Scotland dropped by 13.2 per cent. in 1957 compared with 1956. In England and Wales the fall was only 1.9 per cent. These figures certainly give us food for thought; but what effect are they having on the Government?

The article went on to say some very nasty things about the Government, which I shall leave out. [HON. MEMBERS: "Why? "] I do not want to leave too much out, but if I confine my speech to what I think are the most important points I have no doubt that my hon. Friends will complete the picture.

Perhaps, on behalf of those who sit on this side, I should have welcomed at an earlier stage the Minister of Labour and the President of the Board of Trade in addition to the Secretary of State for Scotland to this debate.

To continue, Mr. John Marsh, director of the Industrial Welfare Society, at a conference in Glasgow last week which was, once again, sponsored by the Church of Scotland's Church and Industry Committee, had this to say about Scotland's prospects: Unless bold and imaginative thinking and action is encouraged now by the political parties, educationists, industrialists, and, indeed, the Churches, we are likely to have a generation of young people who will be infected by the social cancer of unemployment and who will become inescapably bitter and cynical. In view of the figures that I have given, I do not think that that was an overstatement of the position. I say to the Secretary of State that action should be taken quickly.

What do the Government intend to do about industrial development? You will remember, Mr. Deputy-Speaker, that at the start of my speech I paid tribute to what had been done by the Scottish Office and the late Sir Stafford Cripps to attract new industry to Scotland. In view of the state of affairs in Scotland today, why will not the President of the Board of Trade build advance factories for attracting industry to Scotland? It was that that did so much to help Scotland over the difficult time following the war. The record of the past years does not give any satisfaction in Scotland. The annual survey of the Clydesdale and North of Scotland Bank Limited takes exactly the same line as we on this side have taken. It comments on industrial development, in its report for 1957, as follows: The annual report of the Scottish Council (Development and Industry) noted that 'the restrictions on the building of Government financed factories have affected Scotland particularly severely, since she has, in the past, been more dependent than other areas on this form of building. On average one-sixth of all factory building in Scotland is Government financed'. At all events the area of all new industrial building being planned in Scotland again declined in 1957, and by contrast with 1956 by proportionately more than for Great Britain as a whole. That is the position. I point out to the President of the Board of Trade that, in our term of office, for every two feet of factory space being built in Scotland only one was being built in London and the South. Since the Government came to power that position has become completely reversed, so that for every two, or rather more than two, now being built in London and the South, only one is being built in Scotland. I suggest that the right hon. Gentleman had better give some quick thought to the provision of new factories in Scotland. We certainly call for a reversal of the present figures.

For some considerable time Scotland has been asking for a new graving dock. There is no doubt that mining and shipbuilding are the basic industries of Scotland. But if we are to maintain our place in shipbuilding, maintenance and repairing, it is essential that we should have a graving dock fit to take the largest ships coming from the shipyards of the world. Scotland has a proud record in shipbuilding. I suggest that before the debate finishes we might at least get an answer to that question.

I had thought of saying something about roads, but after the speech of my hon. Friend the Member for Dundee, East (Mr. G. M. Thomson) in the Scottish Grand Committee I do not think there is anything I need say to stress the need for a Tay Road Bridge. My hon. Friend put the case very forcibly and logically. He said that if we were to make progress in Scotland we should at least have one road that ran from north to south, and not have to ship our goods across certain rivers. Neither do I think it falls to me to say much more about the problems of the Highlands and Highland roads. That point was stressed by hon. Members representing Highland constituencies.

In addition to improving and modernising our basic industry, post-war history has proved—if it has proved anything—that if we are to improve Scotland's unenviable record of employment we must attract still further new industries to Scotland. This means a new steel strip mill for Scotland. Hon. Members will not be surprised that I raise this matter this afternoon. I want to make it quite clear that Scotland does not regard herself as being in competition with Wales upon this issue. We are not in competition we are merely stating a demand that has existed for a considerable time.

The case could not have been put better than it was more than three years ago, when it was considered by the Estimates Committee. I want to put this fact on record today, because so many people seem to think that this demand for a strip mill in Scotland is a development of recent months. It is nothing of the kind. I want to refer to evidence taken from the Report of the Select Committee on Estimates—Sub-Committee E—on 26th April, 1955. It then had before it as witnesses the Scottish Controller of the Board of Trade, Mr. Allan Young, and Mr. W. C. Kirkwood, the General Manager of the Scottish Industrial Estates Limited.

Mr. Young was stressing the need for getting new industry to Scotland, and on page 112 of the Report he said: The steel industry in Scotland is geared to the shipbuilding industry, and to heavy engineering. If we were making light steel sheet and strip, that at least might be one factor in attracting up there"— that is, to Scotland— industries that would make use of that lighter material Then, at Question 706, my hon. Friend the Member for Hammersmith, North (Mr. Tomney) said: That is the point I wanted to get at. If we are trying to build up an insurance against future unemployment in the shipyards, the desirability of attracting this type of component firm to districts such as yours is more than urgent. Mr. Young replied: I should be more than grateful. Sir, if you were able to persuade the Steel Board to put down a new sheet and strip mill in Scotland. I think that would probably do more than all the multitude of smaller things that we have been able to bring in. That was the opinion of the Controller of the Board of Trade for Scotland, expressed rather more than three years ago. If it were urgent then, it is more urgent today. Scotland looks forward to a decision on this matter at a very early date.

We raise all these matters this afternoon because of the plight of Scotland and because, as the Church and Nation Report says, on page 372: The responsibility for maintaining a healthy economy rests primarily on the Government of the day. We could not agree more with that, and we hope that the Government will accept their responsibility. Scotland is more than willing to play her part in securing and maintaining a sound economy in Great Britain. She is also willing to play her part in the European Free Trade Area—but let the Government make sure that Scotland is equipped to do the job.

Mr. John Taylor (Westlothian)

I beg formally to second the Amendment.

4.15 p.m.

The President of the Board of Trade (Sir David Eccles)

The hon. Member for Leith (Mr. Hoy) has a great advantage over me in that he comes from Scotland and knows his subject inside out. I think that the whole House was impressed with the serious way in which he approached this vital problem. I feel that I ought to ask for the indulgence of the House—

Mr. William Ross (Kilmarnock)

The right hon. Gentleman will not get it.

Sir D. Eccles

—because it is the first time that I have ever spoken on Scottish problems.

The Board of Trade has to take a balanced view of the national economy, which means that I have to think of England and Wales, and Northern Ireland, as well as Scotland. I shall try to take a balanced view of the Scottish part of our national economy. I had better declare my interest. I sit for the English county in which I live, and the only one of my ancestors who has secured his place in the history books could not have achieved his title to fame if he had not emigrated from Scotland.

In modern times no people have made a greater name for themselves, both inside and outside their country, than the Scots. Every hon. Member, in his travels, must have been struck by the commanding influence of Scotsmen wherever fortunes are being made and great developments are in hand, especially in the Commonwealth. If one goes to a place like British Columbia one finds that it is almost like being in a part of Scotland. The accent is heard everywhere, and the names of the leading citizens are Ross, Fraser and Macmillan.

Listening to the hon. Member for Leith I was confirmed in an old opinion of mine, that the Scots like to have it both ways; they like to go roving in search of prizes and high honours, and they also want someone to see that there is a prosperous and well-ordered home to go back to. That is a dual and very human desire, but it is not always very easy to achieve.

I asked what sort of people emigrated from Scotland last year, and I was told that among the considerable number doing so many had professional qualifications, and others were skilled engineers, whose services were badly needed in Scotland. That shows that the roving spirit is still alive.

Mr. Thomas Fraser (Hamilton)

There were no opportunities for them at home.

Sir D. Eccles

That is exactly what is not true. If the hon. Member will look at the categories of people who left Scotland last year he will find many for whom jobs were available in Scotland. It shows that the roving spirit is still alive.

Mr. Fraser

Will the right hon. Gentleman bear in mind the remarks of such an eminent person as the Principal of Edinburgh University—Sir Edward Appleton—who has been regretting the fact that a great number of science graduates and others who come out of Scottish universities have no opportunity of employment in Scotland?

Sir D. Eccles

I have the utmost regard for Sir Edward Appleton, whom I think is a very fine man, but although there were many vacancies in skilled engineering many skilled engineers still went abroad. In spite of the fact that the average Scotsman is two years younger than the average Englishman it is sometimes rather difficult to find people to run some of the Scottish industries.

But this afternoon we are considering employment inside Scotland and I should like to begin, in answer to the chief point made by the hon. Member for Leith, by asking what should be the limits of Government action to keep men and women from moving away from their homes.

Mr. Hoy

There is a difference between keeping them from moving away and driving them away.

Sir D. Eccles

The hon. Member can have it as he likes, but the point is how far should we go to keep them from moving.

Mr. T. Fraser

It is nothing of the kind.

Sir D. Eccles

We have today a distribution of industry policy and we have powers to implement it. Suppose that the relevant Acts of Parliament had always been on the Statute Book. If the principles of applying them have always been to bring work to the worker, we should have had no Industrial Revolution and no British Commonwealth, and we should have remained the impoverished and insular society of the Middle Ages.

Mr. Douglas Johnston (Paisley)

Will the right hon. Gentleman enlarge upon this thesis to which he has given vent? I find it difficult to follow his statement.

Sir D. Eccles

I should have thought that the hon. and learned Gentleman must know that the reason why we have built up these enormous populations in different parts of the United Kingdom was that people have moved away from their homes and gone there. He is entitled to say that he would have preferred us not to have had an Industrial Revolution, but if we had always had this policy we should never have had the great industrial centres in the United Kingdom.

But times change, and in our industrialised age it looks very much as if we were deliberately trying to persuade some industry to go where it does not want to go. That is the essence of a distribution of industry policy. We do not quarrel with that policy. It is a policy which the Government and the House support. I want to see this afternoon how successful we have been in Scotland in achieving that policy and how successful we are likely to be.

The first thing that one learns when administering the distribution of industry policy is that the general state of business has an overwhelming influence on what can be done. For a good many years we have had very prosperous times in industry, and since 1948 industry in Scotland has grown, both in size and in diversity. Production is up by 28 per cent. It is difficult to pick out particular examples, but of sizeable factories, each employing several hundreds of workers, nine have been completed since July, 1957, 10 are under construction and 10 more have been approved in the last few months. This cannot be described as a very bleak or stagnant situation. Hon. Members are also well aware of the range and number of developments outside Scotland's traditional industrial centres.

I was very pleased to see the Glasgow Herald Mid-Year Review of Industry and Commerce giving fine publicity to these striking achievements, of which I suppose the most dramatic is the research and development establishment at Dounreay, on which the eyes of all the nuclear physicists of the world are certainly centred. Then there are the electricity generating programme, which stretches from Chapel-cross to Loch Shin, Hunterston to Kincardine-on-Forth, the oil pipeline terminal on Loch Long, the £6 million extension to the British Petroleum Company's refinery at Grangemouth, all to be completed in a year or so, and the £6½ million Lurgi gasification plant which is being installed in Fife. All these are impressive power developments.

In civil engineering the Clyde Tunnel and the Forth Bridge will stimulate a wider spread of industry from Glasgow and Edinburgh. Several new or expanding towns are going ahead, based on industry coming in from outside Scotland. We very much welcome these American firms and we hope that there will be more of them. Together with the Scottish Council (Development and Industry) we are doing our best to attract them.

I should, however, like to correct the statement made last Tuesday by the hon. Member for Glasgow, Central (Mr. McInnes). He said that Scottish Industrial Estates had dozens of applications for factory accommodation from American, Continental and Scottish firms, and that Scottish Industrial Estates was unable to provide factories for them. I regret to say that that is completely untrue.

Mr. James McInnes (Glasgow, Central)

The right hon. Gentleman is responsible for Scottish Industrial Estates. Will he read the speech of the chairman of that body, from which I quote? He said: We have had 100 inquiries for factory space from Scottish firms in the last twelve months. No fewer than twelve American corporations and one French concern have shown interest in coming to Scotland. It is a regrettable fact that we have not been in a position to offer them these factories.

Sir D. Eccles

That speech was made two years ago, and it was not accurate then.

Mr. McInnes

The speech was made at the end of 1956, which is a year and a half ago.

Sir D. Eccles

The hon. Member will find that it is almost two years. In any case, the House may as well know the position today. There are no applications from American or Continental firms for factory space from Scottish Industrial Estates, and it is not correct to say that we have turned down any applications.

Mr. Hector Hughes (Aberdeen, North)

Is the right hon. Gentleman departing from that part of his speech about the distribution of industry? If so, does he not realise that it is a bogus distribution of industry, that nothing is being done for the North of Scotland, and that industry is concentrating in the South?

Sir D. Eccles

I have a good deal more to say about the distribution of industry.

There is no doubt that a major factor in the present lack of applications for factory space in Scotland is that Scotland, like the rest of the United Kingdom, has felt the effects of the check to industrial expansion in the last twelve months.

Mr. William Hamilton (Fife, West)

In the last four years.

Sir D. Eccles

Any kind of recession or restraint in demand reduces the number of firms willing to expand and reduces still more the number willing to expand in an unfamiliar area. Most of the increase of 1 per cent. in unemployment in Scotland since the debate on this subject last year was due to national or international causes.

Mr. Ross

One per cent.? The right hon. Gentleman had better get someone to look at his figures.

Sir D. Eccles

Yes, 22,000 is 1 per cent.

Steel, machine tools, wool and building are some of the industries which have been affected by the credit squeeze, or by what has happened in world trade. On the other hand, chemicals and electrical equipment, together with the food and drink industry, have expanded very well.

Mr. Ross

I believe that the unemployment figure last year was about 54,000. At present, it is 76,000. That is an increase of nearly 22,000. A 22,000 increase on 55,000 is, with due respect to the right hon. Gentleman, who used to be Minister of Education, not 1 per cent.

Sir D. Eccles

The hon. Member is simply taking a basis which is not important. Twenty-two thousand is 1 per cent. of the insured workers in Scotland.

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

Why did the right hon. Gentleman not say so in the first place?

Sir D. Eccles

Because everybody knows what I was referring to.

This fact of some industries doing well while others are not doing so well is a pattern which is visible right across the United Kingdom. The first thing I would say about this is that employment today would be much more precarious than it is if the inflation had not been tackled with vigour and success. We have had to pay for the steadying of prices and for the strengthening of the £ by a reduction in the number of unfilled vacancies and by a small increase in the registered unemployed. But the result of the improving financial position we now have is that we can cautiously and safely begin to expand, and that result will benefit every industry and every area in the United Kingdom.

It would have been much worse for Scotland if the £ had had to be devalued, or if we had been driven to adopt import controls and all the paraphernalia of restrictions on activities singled out by Whitehall because they were considered to be less essential. I should have thought that every hon. Member representing a Scottish constituency would realise that the only alternative to dealing with inflation by general monetary measures is by controls, and, therefore, by an increase in the power of London over the rest of the United Kingdom.

Mr. Ross

Everything for London.

Sir D. Eccles

If the hon. Gentleman does not wish London to control Scotland, he had better not have a Socialist policy.

The Government's monetary measures have worked well, but the addition of the American recession, has, of course, increased the difficulties. As a result, orders for some well-known Scottish products have fallen, particularly Canadian orders for woollens and steel products. I am glad that the United States Government has agreed to lift the higher tariff from handwoven tweed. That will particularly help the Islands. At the same time, I must record with regret that the tariff quota, which has been imposed by the United States, hits particularly hard the Scottish Border tweed industry. If my hon. Friend the Member far Aberdeenshire, East (Sir R. Boothby) were here, he would be glad to know that whisky, as ever, is going from strength to strength.

Therefore, by far and away the most important thing we can do to help Scottish industry is, both at home and abroad, to create the conditions for a general upturn in trade. We cannot expand our British output much in advance of world recovery, but we can and we are putting ourselves in a position to take advantage of that recovery, and we are encouraging others to co-operate in renewed expansion.

Mr. A. Woodburn (Clackmannan and East Stirlingshire)

I have been listening with great interest to the argument. I agree that the general economic situation might affect Scotland, but could the Minister explain the point in my hon. Friend's speech that, whilst employment has been going down in Scotland, it has been going up in London? We are interested in the distribution of the existing unemployment as well as in the general economic developments.

Sir D. Eccles

I think it is largely true that the consumer industries have done better in the last twelve months than the investment industries, and, of course, there is a large concentration of consumer industry down here in the South.

I have made a few general remarks about the state of industry, because until confidence in an upturn in world trade returns the limits are narrow within which the Board of Trade can find firms willing to start up or extend their business in Scotland, or, indeed, in any other part of the United Kingdom where there is heavy local unemployment.

Nevertheless, a lot has been done. We have never refused an industrial development certificate for Scotland, but we have sometimes failed to persuade firms to go there, as we have failed to persuade them to go to Wales or to the English coastal belt where there is unemployment. To increase the pressure on expanding firms we are told that we ought to refuse more industrial development certificates in the southern half of England. Well, we refuse them for new factories in London, in the South-East area and in the Birmingham area, but they can rarely be refused for an extension, and it is the number of extensions which has had to be matched by these certificates in recent months.

The Board of Trade is in a difficult position. We always have to judge between insisting that a certificate will be granted only if the firm goes where it does not want to go and the risk that this insistence may mean that the expansion never takes place.

Mr. T. Fraser

The Minister has been telling us that the Board of Trade always refuses applications for new factories in London, Birmingham and elsewhere, but generally grants applications for extensions. Will the right hon. Gentleman tell us which of the new factories are not, in fact, extensions of existing industrial establishments? Are they all extensions?

Sir D. Eccles

No, it is when the unit which it is proposed to create is self-contained. It is fairly easy to see when it can be considered a new factory.

Mr. Fraser

It is not.

Sir D. Eccles

We do not have much difficulty in distinguishing between the two.

Mr. Fraser

No, because they are always called extensions.

Sir D. Eccles

That is not correct.

Naturally, the state of trade has a big influence on the readiness of firms to take risks. It has always been easier to persuade big firms to go to unfamiliar places than small firms. The small firm often feels that it has not got the experience to cope with unknown difficulties in a strange area.

The hon. Member for Leith thought that we could persuade more firms to move to Scotland if we built advance factories. We have already given the House the reasons why, at this stage, so long after the post-war scramble, we do not believe that that would be effective. In Scotland, we have on our hands, or about to become vacant, a number of defence establishments. We are ready to give assistance to any industrialist for the conversion of those establishments to industrial uses. That constitutes quite a considerable pool of premises coming on to the market.

In addition, we have now eight vacant factories in Scottish Development Areas, so we are in a position to supply a ready-made factory to anyone who wants it. Generally speaking, however, the new firm nowadays demands a tailor-made building. The days when premises were as scarce as they were just after the war have long been over, and it is our experience that the provision of a building which is not suited to the work that is to go into it has not got much attraction today. None the less, when these factories become vacant, we do all we can to find a new tenant.

I must say that Government money for building a factory is not a big enough inducement unless other conditions are satisfactory. Apart from transport costs, which may often cancel out the subsidised rent we are able to offer, the most powerful of these inducements are, first, the feeling that management will not meet unpredictable troubles in a strange area and, secondly, that the area itself is a good place to start in and to grow in.

The Scottish Council (Development and Industry) has done a very fine job in fostering confidence that Scotland is a good place to go to, and I wish to pay a tribute to Lord Polwarth—who never leaves me alone, and quite rightly—for the energy and enthusiasm he has been putting into the chairmanship of the Executive Committee of that Council. He was appointed a member of the Dollar Exports Council Mission to Canada, where I know he made a great many speeches both in his native accent and in French, and greatly impressed the Canadians about doing business in Scotland. The Board of Trade backs up the Council, and, in particular, we stress the good qualities of the Scottish workman.

I should like to give the House just one example of those qualities, because it struck me very forcibly. Recently, the Cleveland Twist Drill Company started up in Peterhead. The management told me it thought that it would take eighteen months for the factory to become established and for the labour to be trained to a high level of efficiency. However, only six months after production began the company is beating its competitors in North American markets. That is a remarkable achievement. I believe that the same would be true of the labour in other parts of Scotland.

The worst service that anyone can render to an area with unemployment troubles is to talk of nothing but its woes. I say that advisedly. I have noticed—and from time to time I have told deputations—that it is clear that industrialists are put off by an area which is sorry for itself.

That leads me to say that the distribution of industry by Government action can be successful only if one of two conditions are fulfilled. Either the State must control all investment, as in Russia, and that means directing savings, management and labour. One would then be able to order some Scots to stay in Scotland or some Welshmen to stay in Wales or others to move and manage or work in a factory in the desired place.

We have not got those powers; we are glad to have the only other alternative of a free society where direction of labour is ruled out. There must then be a high degree of confidence in the general outlook for trade and in the particular area to which it is wished to persuade a firm to go. Money is not a sufficient substitute for confidence. One must be prepared, as I see it after my short experience at the Board of Trade, either to bully people with strict physical controls or else to create conditions in which businessmen are self-confident and ready to respond to the kind of help which it is reasonable for the Exchequer to give them.

I would say that over the last twenty years private enterprise has increasingly shown a responsibility towards the wider issues of national policy. We have received a great deal of help from many public-spirited firms which could have made much more money if they had not taken into their calculations the social issues involved.

In an endeavour to further this work we are now using again the full powers to make D.A.T.A.C. loans in Development Areas—that is, Development Areas Treasury Advisory Committee loans—and when the amending Bill becomes law we shall be able to give such assistance anywhere where a high rate of unemployment is likely to persist, and to give it for a wider range of objects than industry proper. Later, I shall mention one of those objects.

As we have been operating these Development Area powers in Dundee, I thought that the House might like to have an account of what has actually been achieved there because it shows what can be done by a concentration of effort in circumstances which are anything but easy. The same concentration of effort has, of course, been applied to Greenock.

We have advertised far and wide the fact that public money was available to build new factories in Dundee. We have had very great help from the local authority. Dundee and Greenock have been plugged with every applicant for an industrial development certificate who showed the slightest inclination to go to Scotland, and the results are interesting and on the whole, I think, good.

Since 1945, 13 firms, mainly in Board of Trade factories, have started to manufacture in Dundee. Now I come to recent times. This year six more Government-financed factory buildings have been authorised and two industrial development certificates have been issued for private factory extensions. Well over 2,000 more jobs are thus in sight.

I should like to draw particular attention to the new factory for the Astral Equipment Company which will employ 800 workers. My hon. Friend the Member for Harrow, Central (Mr. Bishop) is chairman of the company, and I thank him and his associates for the splendid way in which they have co-operated with us. This is a very go-ahead company, and I feel sure that it will make a great success of the new plant in Dundee, where it has already had some satisfactory experience. This very day I have approved a larger extension—considerably larger than we had previously heard of—costing about £500,000 to be provided out of public funds for the National Cash Register Company, which will in time give work to more than 500 people.

I must say a word about the jute industry. The jute industry itself is, of course, becoming more mechanised, and, in any event, would require less labour for that reason. We hope that some of the jute manufacturers will, with help from the Government, further diversify their production. We hope that very much because as things are now a great deal of substitution of other materials for jute seems to be inevitable in certain important products, and it is this substitution which worries us. Prices for jute goods have now to be kept too high for the good health of the industry. They are kept high by the method of the Jute Control, which is familiar to the House.

The Jute Control has made an accumulated profit of £2 million since the war. In that time the Board of Trade has spent £1.6 million on new factories in Dundee, and since I went to the Board of Trade I have authorised further factories which will cost another £1.7 million. So we have spent, or are committed to spend, a good deal more than the profit of the Control to date.

It is a fact that at this moment the Control is making about £1.5 million a year—so high have the mark-ups to be—but these profits are bound to decline if the substitutes for jute gain the market. That is why the only long-term policy is to make public funds available for creating new employment in and around Dundee so that the consequences of what must be considered an unsatisfactory form of protection can be met without undue hardship.

It is wrong to believe that the whole of the jute industry is doomed, as I sometimes see stated in the Press. As I understand, there always will be many important specialities which Dundee and the area around can make in competition with the world. What does trouble me is that those who have to transport goods should have to pay for jute sacks a price so much higher than the world price that they are being driven to use substitutes. So the Government's policy must be to diversify employment in Dundee, and this we are doing with a concentration of effort not exceeded in any other difficult area in the United Kingdom.

I have already undertaken not to reduce the mark-up on jute goods without consulting the industry. I do not want to do it. I want to see more employment created; but I think we have to face the fact that at these levels of prices paper and other materials will make inroads. Therefore, it is up to all of us—I think the people in Dundee, the manufacturers, can help very much—to be imaginative and bold and to take advantage of the very considerable financial help offered for the diversification of employment for both men and women.

Mr. John Strachey (Dundee, West)

Will the right hon. Gentleman give an undertaking not to reduce the mark-up any further so long as there is abnormal unemployment in Dundee? That seems to be the important thing—not just before consulting the jute industry. Surely he is aware that if employment in the jute industry continues to fall as fast as it is falling now his 2,000 new jobs for Dundee will not even maintain the present level of employment.

Sir D. Eccles

I understand what the right hon. Gentleman has said, but I cannot give him that assurance because there is a very large industry which makes up sacks and whose employees would lose their livelihood, with the result that the substitution would go further. What we have to do is to create as much new employment as we can and to watch this situation. It is not a successful form of protection which results in the death of the industry which one is trying to protect—if not the whole of the industry, at least a considerable portion of it.

I want now to say a word about Greenock. Since 1945, 12 firms have moved into the Port Glasgow-Greenock area, including nine which were new not only to Greenock, but to Scotland. There have also been about half-a-dozen developments by local firms, bringing the total of jobs provided in the area since 1945 to about 4,000. Last year, arrangements were made for the Board of Trade to double the size of the large factory at Spango Valley occupied by Industrial Business Machines Ltd. Invitations to tender for this building were ready to issue when only two weeks ago the firm told us that because of technical developments it had been forced to revise its production plans.

The Parliamentary Secretary to the Board of Trade and I both saw the representative of the firm. I regret that the extension is to be reduced to about half. I fully appreciate the disappointment which this will cause in Greenock and it is also very disappointing to the Board of Trade. However, the firm has agreed to buy the factory and the extension, and that is a guarantee that it will be established in the neighbourhood permanently. The firm has said that it will expand in the future as soon as it can. That is disappointing news for Greenock, but there is something better to come.

We have authorised the provision from public funds for an extension to another Board of Trade factory, occupied by the International Latex Corporation, which will cost about £300,000 and provide 500 jobs. We are making very special efforts already to find a tenant for the Torpedo Experimental Establishment which will become vacant at the end of next year. The hon. Member for Leith mentioned graving docks. I agree that it is of the greatest importance to the Clyde that there should be a large new dock and it is to Greenock that we expect it to go.

I understand that progress is being made by the local interests on whom, of course, rests the main responsibility for planning the development and organising the finance. D.A.T.A.C.—the authority which considers the loan—is considering the scheme in principle and is awaiting further details. I am sure that when these plans get to the point where finance can be arranged, they will get a very sympathetic reception. My right hon. Friend the Secretary of State for Scotland has put on a great deal of pressure, and he is a man of considerable influence.

As we knew he would, the hon. Member for Leith had a word to say about the fourth strip mill. The House will know that the Prime Minister gave an answer to the hon. Member for Coatbridge and Airdrie (Mrs. Mann) saying that the Government were not in a position to make a statement on the siting of the proposed new mill. The technical and social problems involved have proved particularly baffling and particularly contentious. All I can add to the Prime Minister's statement is that no news is good news for somebody.

I want to refer to tourism, which is a responsibility of the Board of Trade.

Miss Margaret Herbison (Lanarkshire, North)

The right hon. Gentleman has already dealt with two areas where unemployment is very high, but in Lanarkshire, not merely in my own constituency but over the whole of North Lanarkshire, there is a higher figure of unemployment than that for Dundee, for instance. Will not the right hon. Gentleman deal with that area of Scotland?

Sir D. Eccles

I know the figures for North Lanarkshire and I know that they are serious. We are trying to help there, but that unemployment largely stems from the general decline in heavy products, which is due to the recession in world trade. When world trade picks up, I have every hope that the Lanarkshire employment position will pick up with it.

Mrs. Jean Mann (Coatbridge and Airdrie)

A great area of North Lanarkshire is covered by Coatbridge, where unemployment is 8 per cent. The right hon. Gentleman has got a great deal to do there if he is to do anything at all.

Sir D. Eccles

I thank the hon. Lady for bringing it to my attention.

I was about to say something about tourism. We can all agree that nowhere beats Scotland for a holiday, but not enough people go there as yet. When I was Minister of Works, I was proud to be responsible for ancient monuments in Scotland and I visited the abbeys and other treasures, the Edinburgh Gardens, for example, which gave me the very greatest pleasure. Those ancient monuments were well looked after and were a credit to their guardians.

Tourists who go to Scotland will, therefore, find unique scenery and objects of beauty which will reward them for their visit, but the tourist industry as a whole has many problems which need to be considered. Last May, those were brought to our attention by a national conference on tourism, at which Scotland was well represented. It was made very clear to us that this rapidly expanding industry had a number of interesting ideas which required to be followed up. Not least there was the universal complaint about the shortage of hotels in the peak season.

I know that that shortage is very acute in part of the North of Scotland and in the Islands, too. In the Board of Trade we are studying, with the help of other Departments, all the problems raised by the tourist trade. The House might like to know the basic figures of the tourist industry, figures which are unique in the growth which they show. In 1947, 400,000 people visited Britain. They spent £31 million here and they had paid £17½ million in fares to British carriers. Ten years later, in 1957, 1,180,000 visitors came to Britain and spent £128 million here and had paid £52 million in fares to British carriers. There is no industry earning foreign exchange which is expanding at the same rate as tourism and whose future is so good. In the Board of Trade we are now studying, with the help of other Departments, all the problems raised by this trade.

Mr. Woodburn

May I make a suggestion to the right hon. Gentleman? There is a slight complaint that while films about Scotland get their share from the British Holidays and Travel Association, the Government have not so far given any assistance to Scottish-produced films which would do a great deal to help the Scottish industry, since they are produced with enthusiasm by the people most interested.

Sir D. Eccles

I thank the right hon. Gentleman. I will certainly consider that and write to him about it.

I am convinced that in making this study we shall find that Scotland has particular opportunities and that perhaps they have not been developed as they should have been. I give the House an assurance that we will pay special attention to the tourist industry in Scotland.

In the meantime, the Distribution of Industry (Industrial Finance) Bill, amending the Distribution of Industry Act, 1945, will allow the Government, where there is high and persistent unemployment, and there is a need for an hotel, to advance money for building such an hotel. That may well attract some fresh minds and fresh adventure into the hotel business which at present, I am told, is lagging a little because it has not been possible to find the capital.

I apologise for keeping the House so long. I was asked one or two questions which I have not answered. My right hon. Friend the Secretary of State for Scotland will speak about shale oil and no doubt other hon. Members will raise points during the debate. Some may be Board of Trade points and I will write to each hon. Member concerned if my right hon. Friend does not have time to answer all the questions put when he winds up the debate.

Sir Beverley Baxter (Southgate)

Will my right hon. Friend elucidate an important point? The right hon. Gentleman said that the whisky was going from strength to strength—we are very glad to hear that—but is he aware that that has not proved the case with the whisky served to us in the refreshment rooms of the House of Commons?

Sir D. Eccles

I know that my hon. Friend is an admirable judge. I will leave it to him to take the proper steps.

I should like to record the appreciation of the Board of Trade and of my colleagues for the vigour in Scottish industry and particularly the contributions which it is now making to the export trade. It is very satisfactory to note that in 1958 the number of inquiries about export markets received by Board of Trade Office in Scotland is substantially greater than it was in the same period of 1957. I think that it is between 15 and 20 per cent. higher.

The Canadian Trade Mission which came here last December went out of its way to tell me, just before leaving, how well it had been received in Scotland and how much it had been impressed by Scottish industry. There seems to be nothing wrong with Scottish industry, except that there is not yet quite enough of it. We are endeavouring to fill the gaps and I think that we shall be able to do so in increasing volume.

It is sometimes very difficult to persuade a firm to go to Scotland, but I have yet to find a single one which, on going there, regretted its decision. Hon. Members who sit for Scottish seats can help the Board of Trade in this matter by advertising the attractions of Scotland for new industry.

The Government are under no illusions about the formidable qualities of the people from whom you Mr. Deputy-Speaker, Mr. Speaker himself, the Lord Chancellor, the Prime Minister, the Secretary of State for Scotland, the Secretary of State for Commonwealth Relations, the Minister of Labour and the First Lord of the Admiralty come. They do not allow us Englishmen to take lightly the virtues of the Kingdom from which they come. It is quite clear that a Conservative Government is not subject to the Goschen formula. From very practical experience I ask the House to share our confidence in Scotland's ability to carve out a marvellous future for her industries.

5.4 p.m.

Mr. Thomas Steele (Dunbartonshire, West)

We must pay tribute to the President of the Board of Trade for the very nice things which he has said about Scotland and about Scotsmen, and also about the efforts that certain Scots industrialists are making to help and assist Scotland. However, I do not think that the President of the Board of Trade gave any indication what further steps the Government are taking at this time to help and assist Scotland to deal with her problems.

Many hon. Members wish to speak this afternoon. I want to set an example by speaking for only ten or twelve minutes so that as many Members as possible may have an opportunity to speak. I want to direct my remarks to the President of the Board of Trade to the subject of industrial estate policy.

In my own constituency, there is the Strathleven industrial estate. That industrial estate is there because of the unemployment position in the inter-war years, because of the difficulties of the United Turkey Red Company, and because of the plight of the whole of that area just prior to the war. The area itself was very happy to welcome the new industrial estate at Strathleven and looked forward with pleasure to it being made successful.

Four factories were built. West Clox and Burroughs Adding Machines are the two main ones, and both of these factories have extended. The occupants of one of the factories had to give it up. When that industry came to the area many of us in Scotland wondered what would happen if any decline took place, because it was part of another English firm. When, in fact, decline did take place this was the first factory to close. Instead of this factory being offered to other firms, it was given over as an extension to one of the already existing factories. Unfortunately, for a fair length of time it was used only for storage.

It was only because of the agitation of the trade union movement in the district that the firm which took over the factory started to do something about it. Nothing else has been done. No other building has been taking place on the Strathleven Industrial Estate. I was very much concerned that when one of the firms, Burroughs Adding Machines, which had been very successful and employed a large number of people, wanted to add to its factory space it was invited by the Government—I will not use the word "ordered" but coerced by the Government, understand—to go to Cumbernauld. I should like to know exactly what happened in that particular instance.

The President of the Board of Trade, in his speech, referred to two main parts of Scotland, Greenock and Dundee. I think that a tribute is due to the Members for those two constituencies for getting so much publicity for those two parts of the country. But these are not the only parts of Scotland that are in difficulties. In Dunbartonshire the unemployment level is 6 per cent. My hon. Friend the Member for Coatbridge and Airdrie (Mrs. Mann) says that it is 8 per cent. in her constituency, and in Lanarkshire, generally, the figures are rising and are. I understand, about 7 per cent. We would not expect our colleagues from Greenock and Dundee to object to the President of the Board of Trade and the Minister of Labour having a look at the other parts of Scotland as well.

I want to know if any efforts are being made to attract industrialists to the Strathleven industrial estate. There is still plenty of space there and accommodation for factories which could well be built. The President of the Board of Trade said that he never refused an industrial certificate to any firm that wanted to go to Scotland. But that is not the only difficulty. We have quite a number of very old factories which were given up by the United Turkey Red Company in the Vale of Leven and a number of industrialists have been taking over some of those factories.

An industry from the south was interested in one of those factories. It was to be a completely new industry. It was something which would have been worth while, but although the bank was prepared to offer credit, the Capital Issues Committee refused to give its permission. It is not, therefore, merely a question of getting an industrial certificate. The capital is required also.

We have been told that the Government expect that something will be done in connection with the military establishments and my hon. Friend the Member for Dunbartonshire, East (Mr. Bence) will, no doubt, have something to say about Dalmuir. One of the arguments that the Government have put is that Babcock & Wilcox, who will be taking over this factory, will provide alternative work for the people there. But we already have a factory owned by Babcock & Wilcox in Dumbarton, only three or four miles away, and it has gone on to short-time, working four days a week. It is not very encouraging for those now working in the Dalmuir factory to think what will happen when Babcock & Wilcox take it over. Short-time working is in operation also in other parts of the Vale of Leven.

In the difficult days between the wars, the unemployment figure was round about 60 or 70 per cent. because of the complete failure of the basic industry in the Vale of Leven. One of the features that strikes me today is that the people, recognising the signs that are showing themselves, are very conscious of their position. Even today, ten years after the war, there are still signs of the difficult times of that earlier period, both in the area and among the population. They welcomed the new industrial estate at Strathleven as being something substantial and something to which they could look forward as providing employment. It has, in fact, provided employment.

I have been informed that there are American firms which want to come to Scotland. Difficulties may perhaps have been put in their way—I do not know—but we ought to be told whether these American firms have been given the assistance which they should have been given to enable them to come to this country. Would it be possible, in consultation with them, to have some advance factories for this purpose? I should like to know whether the position in Strathleven has been altered. I have asked Questions of the Secretary of State for Scotland and have had correspondence with various Departments about the Strathleven industrial estate and I have been told that the policy of the Government was to pay attention to those places where there was a high rate of unemployment and that there would be no further building at the Strathleven estate. Now, the unemployment is up to 6 per cent. May I have an assurance that something will be done now?

We have, of course, the Blackburn Aircraft factory, which employs a large number of skilled workers. The figure has now dwindled to about 180, however, and I very much fear that before the end of the year there will be no workers in the factory at all. I hope and trust that we may have an indication of the Government's policy about the industrial estates. Are they to be used as it was hoped they would be used? I hope that, when he replies to the debate, the Secretary of State for Scotland will say whether there is any prospect of new building at the Strathleven industrial estate.

5.14 p.m.

Sir James Hutchison (Glasgow, Scotstoun)

I greatly appreciate the presence of my right hon. Friend the President of the Board of Trade to listen to this debate, because many of the questions which will arise in discussion of this important subject lead directly to his Department. It is true, as the hon. Member for Leith (Mr. Hoy) said, that these debates have taken place every year since the first occasion when there was a two-day debate, but I do not think that at any time was it more important for us to try to look into the rather obscure future and take decisions than it is at present.

There are two particular factors which have not come into play in our considerations before but which must enter into our thoughts today. The first is what effect the Common Market or the Free Trade Area will have on Scottish trade and what we should be doing about it so far as Scotland can do anything by itself. The second is the progress that the Soviets are making in their trade efficiency.

If we look at recent trade returns, we find that apart from the mining and quarrying industry, in which we have always had a rather raw deal, the production of manufactured goods in Scotland has not been bad. Taking 1948 as 100, they have risen to 133 in 1957, or a 33⅓ per cent. increase. We must, however, remember when making comparisons with foreign statistics that we were not like many foreign countries which after the war started from almost nothing.

It is true that we have not done quite so well in Scotland as in England, where the comparable figures are 100 and 143. One of the great difficulties which we have always been up against, however, is that a large consuming public—this is where the Common Market and the Free Trade Area enter into our considerations—has always tended to attract especially the consumer-providing industries. That is why Members, on both sides, join in asking for special consideration for Scotland. I mean special consideration of Scotland's problem which may lead to special treatment.

We deplore the fact that unemployment in Scotland has remained stubbornly about double that of England and the figures for our development areas remain disappointingly high. Since February, however, the rate of Scottish unemployment has slightly diminished, whereas in England it has shown a slight increase. Outside the black spots in Scotland, we should not look upon the present figure too tragically. I think it was Lord Beveridge who said that 3 per cent. unemployment was not to be regarded as being anything unreasonable. I should like to bring it down somewhat and say that we must not get worried if there is something like 2 per cent. unemployment, which, in any case, is probably about the percentage which is taken up by transition. While we are thinking in terms of unemployment, let us also for the moment think in terms of employment, because last year we were very close to the all-time record for employment of 1956.

Having said that, let me now say that the prospects concerning unemployment are rather disquieting. When National Service comes to an end, and when we work ourselves into what is known as the school-leaving "bulge", unless we can provide considerably increased employment in Scotland we may find the present unemployment figures vary nearly doubled. That is something that we cannot regard with any equanimity.

What sort of factors come into our thinking apart from the effect of the American recession, which looks as if it is spending itself and at last flattening out? I mentioned earlier the question of the Common Market and possible Russian trade aggression. Both of these factors demand 100 per cent. efficiency in industry, whether it be in Scotland or in England, and they also, in my view, demand the arrival of a Free Trade Area.

If we recognise the progress that we have been making, and which has already been outlined by my right hon. Friend, in attracting American industry to Scotland—and many of our plans are based on attracting it even further in the future—we must recognise that America has found a great attraction in coming to Scotland because of its easy entry into the Commonwealth market, which, however, is not as easy a market as it used to be. Commonwealth countries are tending to want to build up their own industrial development and make it a bit more difficult for the goods from this country to get in.

If a Common Market is set up in Europe with a consuming population of 160 million, the Americans will think very hard before they go on setting up their factories in a country with a consuming population of 50 million—and a much more difficult Commonwealth trade than used to be the case—when at the same time there is the pull of a 160 million consuming public in the centre of Europe. That is why I think it so important for Scotland that the Free Trade Area should in fact come about. Otherwise, we shall find it very difficult to attract these American industries to Scotland because, as I am sure every hon. Member knows, the Free Trade Area brings us into a Common Market, and those disadvantages disappear.

I wish to turn for a moment to the question of Government-financed factories. In this connection Scotland has done well, in that Scotland has had a high proportion of the finance which in recent years has been approved for this purpose. But we still need diversification of industry. I, and most hon. Members, have preached that almost ever since the war. We are not sufficiently well represented in the new scientifically based industries, in electronics, in the chemical industries and so on. We must all remember how all along we have been disappointed that Scotland was not represented properly in the motor car industry, or indeed in the aircraft industry either. That points the finger to the sort of industry that the Government ought to seek to attract by the methods which my right hon. Friend has indicated, and which we all know.

The result of this lack of scientifically based industry has led to some rather disappointing, almost distressing, figures of the number of scientists, of which Scotland is training more than her share, but of whom very few remain in Scotland. Once we have completed the training of these young scientific men, the next step is to provide employment for them and to keep them in our country.

I am delighted that the Government are taking wider powers under the Distribution of Industry (Industrial Finance) Bill, so that grants and loans to any suitable type of trade or business may be made available in a less restricted manner than before—provided, of course, that there is a high level of unemployment in the area.

I should like to join forces with the hon. Member for Dunbartonshire, West (Mr. Steele) about the treatment of the Development Areas and the new town areas in this matter. I am a little puzzled—as I think was the hon. Member for Dunbartonshire, West if I understood him aright—about whether the Government are to help with finance concerns that want to come into one of these new town areas, with the provision perhaps of a factory into which goes Government finance and which can then be rented, if they so want it. Is the finance and help to be withheld because there is not already a high rate of unemployment? It looks to me as though we are chasing our tail in the most absurd way by trying to attract industry into one of the new town areas, where it is essential that industry should go if the population is to come—and it would be tragic to attract a large population if there is nothing for them to work at—and then, before that situation has developed, for the Government to say, "But the financial assistance which would have been available, had there been a high rate of unemployment in that area, is not yet available, because unemployment has not yet come about."

Perhaps I have not got the picture correct in my mind, but I should be glad to know the position about Government help in these new areas in order to attract further concerns. May I take this opportunity to ask whether any other concern is offering to come to the Cumbernauld district? We know the success there has been with the Burroughs Adding Machine factory which I understand will employ about 3,000 people. That is a small proportion of the total population ultimately to be absorbed by the new town at Cumbernauld. May we be told whether there is a prospect of other industries coming into that area, or is this the only one at the moment?

May I make a point which I am glad to note has been underlined in various debates in another place and in the Government document, about the powers of local authorities to build? They have been rarely used. I do not know how far local authorities were unaware of the powers they had, but I hope that they will be used much more generously in the future. I understand that now Scottish Industrial Estates are available to advise local authorities in connection with these building plans and I wonder whether this has been brought closely to the attention of all the local authorities concerned.

May I ask my right hon. Friend this question in that connection? If local authorities are, in fact, to be asked to provide industrial accommodation and to build factories for newcomers, cannot the Government think about relaxing the money borrowing rates for that purpose? In other words, could not local authorities obtain money by something like the old method than having to go, for this purpose only, to the money market? That would be an inducement to local authorities to go ahead with plans for building factories for newcomers to their areas.

I wish to ask my right hon. Friend the Secretary of State one question which I will put very shortly. It arises from the debate we had on research, because research is desperately important in relation to the efficiency of industry. I think that some progress has been made in research thinking since our debate a year ago when it was pointed out how important it is to get applied research through to the user. In that debate it was shown that at least the problem was understood, but I was disappointed to hear my right hon. Friend, and the Joint Under-Secretary, say that only industry could take the thing any further.

I wish to make another plea—I made it last year—for the small concern. It is not good enough to expect the small concern to know to what sort of research establishment it should direct itself in connection with its own business. Such concerns have neither the personnel, the knowledge, nor the staff, to be able to follow the complications of that, and often they do not know where to go. In every other form of commerce it is a conception of trade that if a firm has something it wants somebody to buy or make use of, it goes out and tries to sell it. That can equally well apply to applied research. I know that the staff is not there. I am really pleading for a staff to be created, either under the Scottish Council or the Board of Trade or jointly.

Once something has been discovered and this research has been translated into applied research we should start thinking of who could be benefited or how the discovery could be circulated rather like the organisation called the National Industrial Fuel Efficiency Service, goes about urging people to economise in fuel consumption. That organisation has taken a much greater initiative than has ever been taken in applied research. I should like to see the same initiative taken in applied research. Let us at least go as far as that. When something has been discovered, when it is found that something used in an engineering concern, in a mill or in a garage may be improved—there are a million things that could be done, but about which such concerns never learn themselves and do not know where to go to learn—I think it should be the obligation of a research organization, just as it is the obligation of N.I.F.E.S. in respect of fuel economy, to seek them out and tell them.

We have been thinking a great deal on the lines of research, technology and so on, but there has been a tendency for management not to have so much limelight turned on it in commercial enterprise as technical qualifications have had. I would now ask the Government if they will do all they can to further a scheme which has already had their blessing and which was evolved by the chambers of commerce. It is a management apprentices scheme for young people. It needs the co-operation of employers, and employers should be encouraged to make available to these young apprentices all the schooling that is needed to allow them ultimately to become managers and directors. It is a good scheme and an important conception. Any help that the Government can give will be greatly appreciated.

In connection with the tourist trade, let me say how much I welcome at long last that tie Catering Wages Act is to be amended. No country has been harder hit than Scotland by that ridiculous Measure and the ridiculous conditions which the Catering Wages Act has imposed on small hotels. I rejoice to hear that flexibility is to be introduced into the system. If that comes about, our tourist trade will be greatly benefited.

5.31 p.m.

Mr. G. M. Thomson (Dundee, East)

I know that the hon. Member for Glasgow, Scotstoun (Sir J. Hutchison) will acquit me of any discourtesy if I say that I am rather more concerned with the speech from the President of the Board of Trade than with his, although I listened to it with interest.

It seemed to me that the President of the Board of Trade, fresh from his commercial salesmanship tour of South America, had come to the House to give Scotland the benefit of his salesmanship but, as one of the representatives of Dundee, I experienced some consumer resistance to the story he told us about Dundee this afternoon. As to the present alarming unemployment situation, I regard the right hon. Gentleman as the principal author of the increased unemployment, because a year ago he reduced the price protection given to the jute industry through the Government's jute control.

I am not saying that all the unemployment is due to the right hon. Gentleman's action; some is due to general world conditions. A great deal of it is directly due to his action or is indirectly due to general uncertainty that he has created in the jute industry. The President of the Board of Trade may recollect that when he made his announcement last year his hon. Friend the Member for South Angus (Sir J. Duncan) offered an estimate of the effect that the decision would have on the jute industry and suggested that it might reduce the industry by about 3,000 jobs. That has just about been the result of the action of the President of the Board of Trade, so far as one can analyse the figures.

There was no need to take that action last summer, especially in view of the world economic climate in which it was taken. The President of the Board of Trade has told us today that the jute industry is in the process of modernisation and that that created technological unemployment. We are all aware of that. He also stressed the danger of jute being priced out by substitutes. That danger has existed for many years. It did not suddenly come to a crisis last summer.

The right hon. Gentleman spoke of the need for balancing one interest in the jute industry with another; I do not dispute that. But the bag and sewing interests that he is talking of are a very small part of the jute industry, and if he wished to balance the interests fairly, particularly in relation to unemployment, he should not have taken the action that he did last year. We got a characteristic piece of salesmanship from the right hon. Gentleman when he said that he was glad to give an assurance that, before there was any further reduction, he would fully consult those concerned. The House ought to realise that there was consultation before the last decision. It consisted of the right hon. Gentleman inviting representatives of the industry to see him, of telling them what he intended to do and then swearing them into confidence until he made his statement in the House of Commons. The elected representatives were not given any sort of information about what was proposed until it actually happened. Therefore that kind of assurance gives no strong confidence to the industry at all.

When the right hon. Gentleman tells us that the efforts of the Board of Trade have been directed to bringing new industries to Dundee, we are genuinely grateful. When he tells us that those efforts have so far produced factory extensions which in the end will give Dundee 2,000 more jobs, we are also genuinely grateful: but the matter has to be seen in perspective. The first of those jobs will begin to arrive in Dundee only about a year from now. The last will arrive in about three years' time. In the first six months of this year, since January, unemployment in Dundee has more than doubled. There has been an increase in unemployment of rather more than 2,500 people. The President of the Board of Trade is suggesting that we ought to be satisfied that 2,000 jobs will be created in the next three years to replace them.

Nobody disputes that industries have to change as economic conditions change or that the jute industry must go ahead and modernise and that in the process of so doing unemployment will be created, but we say that these things should be planned in such a way that there are new jobs before the Government, by their own deliberate action, create unemployment.

Among a number of rather bland statements, the right hon. Gentleman paid a tribute to Lord Polwarth. But Lord Polwarth, on behalf of the Scottish Council, has expressed views about jute very different from those of the right hon. Gentleman. Speaking in April, Lord Polwarth said: While we don't argue that the Government should undertake to protect jute indefinitely, we do feel most strongly that it should not further reduce the price support afforded to the industry more rapidly than alternative sources of employment in the district can be built up. Not only that, but it is important that this should be known to be the Government's attitude. If the Government had accepted the advice of Lord Polwarth and said that this was their policy, there would not be much in dispute. It is only because the President of the Board of Trade adamantly refuses to do this that the great uncertainty hangs over the jute industry in Dundee.

I would remind the right hon. Gentleman that he is a member of the Government that gave most specific pledges to the jute industry. He knows that his predecessor in office gave me a pledge in 1955 which was quite unequivocal. The then President of the Board of Trade said: Unless an alternative method of safeguarding the United Kingdom jute industry can be worked out and introduced, the removal of control over the import of jute goods would have a serious effect on the prosperity, efficiency, output and employment of the industry. In view of the heavy concentration of industry in Dundee and its distance from the main centres of population, there would be a danger of continuing large-scale unemployment. It is in view of this position that Ministers decided that the industry must be safeguarded."—[OFFICIAL REPORT, 24th March. 1955; Vol. 538, c. 2245.] I do not know that anything could be more definite than that. The unique character of the Dundee unemployment is the relative geographical isolation of Dundee. There is no alternative industrial employment available today within the immediate neighbourhood. It means people uprooting themselves and going elsewhere.

The right hon. Gentleman will be aware that Lord Woolton, who was then in the Government as Minister of Materials, repeated that pledge elsewhere, and quite recently he has told us that he meant exactly what he said, when he used these words. Moreover, he revealed that the Government had investigated alternative action for the safeguarding of industry, and had concluded that State trading, although naturally objectionable to Conservative politicians, was in fact the only method of doing so. The President of the Board of Trade, therefore, is in honour bound by that pledge, at least until he can find alternative employment for the people of Dundee.

A great deal of uncertainty in the city which I represent is due to the fact that it is known that the President of the Board of Trade is deeply hostile to the whole system of jute control, which has helped to preserve employment in the city. Some of the most revealing passages in the debate on the cotton industry were not his comments about cotton, but those he was provoked to make quite casually about jute. The right hon. Gentleman, in reply to an interjection from my right hon. Friend the Member for Huyton (Mr. H. Wilson), used these remarkable words: We have moved a little way on the jute problem. It was a scheme which we inherited and which I dislike very much.—[OFFICIAL REPORT, 30th June. 1958; Vol. 590, c. 910.] Those are frank words, but the phrase— We have moved a little way on the jute problem"— means in practice "We have created 2,500 unemployed in Dundee". The Paymaster-General, when we wound up that debate, also referred to the jute control, and called it— continuing temporarily a war-time restriction … totally at variance with every national and international practice."—[OFFICIAL REPORT, 30th June. 1958; Vol. 590, c. 1011.] "Continuing temporarily a war-time restriction" is a very different description of the Government jute control from that given in the pledge by the then President of the Board of Trade only a few years ago. I repeat that the Government are in honour bound to preserve the jute control, lat least until they can provide the alternative jobs which will maintain full employment in the City of Dundee.

Next, I want to say something to the right hon. Gentleman about the question of providing alternative employment in Dundee. I want to press the case which was made by my hon. Friend the Member for Leith (Mr. Hoy) in his excellent speech opening this debate—the case for advance factories. The President of the Board of Trade rather dismissed this with arguments with which we have become familiar—that, in the changed circumstances of today, as compared with the immediate post-war period of industrial development, there is no demand for these factories. I say only that, having had this argument advanced to me, I have done the best I can by my inquiries among industrialists and other people concerned on this matter, and my information is that over a very large range of industrial techniques, the new standard factory is perfectly good for getting production going quickly.

Only a week or two ago, I talked with the general manager of one of the New Town Development Corporations, who has been notably successful in attracting new industries to his area. I put the question to him, and he said, "We should have been much less successful in getting new-industries if we had not had advance standard factories ready for them to go into." I am sure that the Government ought to reconsider that particular argument.

There is another point which the right hon. Gentleman made about which I want to say a word or two, and it was a point on which I agreed with him. He said it was very important that all those areas with unemployment problems should do their best in all the ways open to them to make the most of their assets and make them known to potential industrialists. I think that in the case of Dundee it will be generally admitted, and I am sure that the President of the Board of Trade will agree, that Dundee has proved that it has adapted itself to new industrial techniques particularly well.

I can remember the National Cash Register Company coming to Dundee immediately after the war. I understand that this company did not go to Dundee because it wanted to do so, but because it was prevented from going somewhere else. However, it came, somewhat sceptical, as it had every right to be, because Dundee was a one-industry textile town with no great diversity of industrial skill. Yet the fact is that the National Cash Register Company has just celebrated its tenth birthday in the city. It has increased its space by five times, and now employs four times as many workers, and, as the right hon. Gentleman has just told us, it is proceeding with a big extension.

This is characteristic of the way in which the men and women of Dundee have responded to opportunities for new jobs when they were provided, and the right hon. Gentleman himself has paid proper tribute to the work which the local authority has done in this matter. Therefore, I do not think there can be any doubt that, if the Government give to the City of Dundee and to other areas with similar problems the help one expects from a Government today, the people of the City will rise to the opportunities given them.

5.46 p.m.

Lady Tweedsmuir (Aberdeen, South)

Although I had the chance on Monday of hearing something of Dundee's problem at first hand, I hope that the hon. Member for Dundee, East (Mr. G. M. Thomson) will not mind if I do not follow him in discussing Dundee's own problem, because I do not wish to keep the House very long.

There is some legislation that I would very much like to see announced in the next Queen's Speech next November, and that is a Bill to amend Scots law whereby movable assets can be regarded as security in the raising of loans. This would benefit all Scottish industry. Last November, I asked whether this matter could be referred to the Law Reform Committee of Scotland, and I understand that this has now been done. I should like to ask what progress has so far been made in considering what is without doubt a very difficult technical problem.

Hon. Members will know that in England movable as well as fixed assets can be mortgaged to secure loans, either for extension or development, but I am told that even English law is by no means clear on the subject. In fact, it is becoming the acknowledged practice in England to accept movable as well as fixed assets as security, although I believe that, were this practice to be challenged in the courts, we might have some very interesting questions raised.

I should like to give one example of the kind of handicap which is experienced by Scottish firms, under Scots law as it now stands, when they wish to raise finance for expanding their own indus-tires. I refer to one firm in my constituency which sought finance to expand its cold storage and quick freezing plant for fish. The White Fish Authority, constituted by Parliament to help the fishing industry, can, in England, provide up to 80 per cent. of a loan for the capital cost of new development, because, as I have already stated, in England movable as well as fixed assets are accepted as security. In Scotland, this is not the case. In the application by the firm to which I refer, which is a firm in my own constituency, it was originally offered only about 25 per cent. of the total loan required, whereas in England it could have been up to 80 per cent. of a £60,000 project.

There is controversy as to whether more cold storage plant is needed or not, but that is not the point at issue at the moment. I am trying to put before the House that we have one problem in law which adversely affects all Scottish industry. The Scottish Council (Industry and Development), in a paper which I think all hon. Members received in the last day or two, puts as one of its proposals to help the employment situation in Scotland that this question should be reviewed.

I am concerned about this issue, because I believe that so far there have been five reports from the Committee on Law Reform in Scotland. I think I am right in saying that so far no action whatever has been taken on any of them, except that an endeavour was made to take action on one point by way of a Private Member's Bill. I ask the Secretary of State whether he will be good enough, when he replies to the debate, to say what hope he has now of getting this report quickly from the Law Reform Committee so that action can be taken.

In Aberdeen, we are fortunate in having more diversity of industry than is the case in the constituencies of many hon. Members who have spoken in the debate. Nevertheless, at present we have an unemployment percentage of 3.9 per cent., which is 3,550 people out of work. I realise that that number includes 836 women, of whom 60 per cent. are, married, and a very large proportion are available only for work for a few hours a day, and there are also the temporarily stopped. Even so, it is a problem and it is added to by the fact that Aberdeen attracts those who are out of work from the north-east counties, which have an unemployment percentage of 8 per cent. Therefore, to absorb some of those workers into established industry in Aberdeen is in itself a very tricky problem.

When we talk of attracting new industries to Scotland we must bear in mind what are the main advantages which all industry seeks. They do not vary in any way from what new industries seek when they try to establish themselves in any country overseas. I would sum them up under five headings. The first they look for is political and economic stability of the country as a whole—political stability in that a Government basically believes in private enterprise and will not hedge it about with too many restrictions; and economic stability in that there will not be any likelihood of devaluation of the £ sterling. While many of the problems that we have discussed today have, to some extent, been due to deliberate Government credit and other restrictions, those have been for wide basic purposes, to fight inflation.

The fact that we are now able to relax in a world where Canada has 8 per cent. unemployment, the United States the same, Western Germany 7 per cent. and we in the United Kingdom as a whole have been able to keep down to 2 per cent., is, at any rate, a tribute to our financial and economic policies in a very difficult period of world trade. In all these matters obviously what really counts is the question of timing. If it will be shown that the timing in the relaxation of those restrictions is correct, I believe that the Chancellor of the Exchequer will be considered one of the greatest that we have had.

Secondly, an advantage which new industry seeks is a country which has not got too high taxation. We have far too high taxation, but, on the other hand, there has been a very steady improvement over the years and that must affect the attraction of all new industry. Under the heading of taxation, I want also to put the level of local rates. I think it very important that national economies should be matched by local economies to try to achieve stability of rates.

Thirdly, there is the question of good services. In Aberdeen, we can include not only very fine services in power, water and transport, but also excellent commercial and professional services and educational opportunities.

Fourthly, industry seeks not to be placed too far from its main markets. That is where we in the North-East of Scotland have suffered more than constituencies of hon. Members who have already spoken.

Lastly, there is the ability, both skilled and unskilled, of those who are to work in industry. I believe that in Aberdeen and the North-East we have a very fine, hard-working body of men and women. I wish to ask the Secretary of State whether any applications have been made to lease the R.A.F. airport buildings recently released at Dyce Airport. Under the recent contraction of the defence programme, those buildings have become available. They are completely serviced and are on an airfield.

In passing, I should point out that it is about time that we had a direct Viscount service from London to Aberdeen. It tis always said that one has to wait until the numbers of passengers improve, but we have now reached the stage at which a great many business people who would be prepared to travel to London for the day by air will not do so unless they get a direct air service. I hope that the Secretary of State will give a prod in the right direction on that matter.

It is not only the new, but also the older industries, we seek to develop in our areas. I was rather disappointed that during the speech of the President of the Board of Trade we heard nothing more of any results or follow-up of the Canadian Trade Mission which was over here recently. I know that many chambers of commerce went to a great deal of trouble to collect information from their various areas to submit to the Canadian Trade Mission and Aberdeen Chamber of Commerce was one. What exactly is being, or has been, done to follow up the inquiries made at that time?

From visits to Canada, I believe it important that those who are trying to promote sales of British and Scottish products in Canada should have resident sales managers there. It seems quite impossible to assess the needs of the Canadian market unless we are prepared to send men to live there and really to understand the local requirements. For instance, it is inevitable that the Canadians are in many ways accustomed to the packaging of American goods. They are accustomed to many of the designs of those goods. Good though we may think many of our products, unless we take that into account I do not believe that we shall have the success which many of our quality goods deserve.

For instance, there is a great deal to be said for some of the varieties in style and sizes of women's clothing in America, which go in such quantities over the border into Canada. They have a far wider range than we have in Scotland. I see the hon. Member for Lanarkshire, North (Miss Herbison) nodding. No doubt, like me, she has had experience in America of the way in which one can go into a shop and buy something "off the peg" without the need for its alteration; but in this country limitations on the sizes, and sizes within sizes, if I make myself clear, which I very much doubt—

Mr. Cyril Bence (Dunbartonshire, East)

That is not clear at all.

Lady Tweedsmuir

No, I did not think it was. The Montreal Trade Conference, which is to take place in September, cannot force Canadians to buy 15 per cent. more British goods. Our goods have got to be better in design and quality than those of our American competitors. That is something we must realise.

It is a very difficult thing when we are in competition with that vast country, which geographically is right on the border of Canada, but unless our people realise it, we have not a hope of diverting 15 per cent. of our trade to Canada. Scottish industry as a whole must accept the inevitability of change. Whether the European Free Trade Area comes about or not, the fact remains that the Common Market is here, which of itself challenges the management of Scottish industry to set its house in order where it is not already doing so.

I do not wish to detain the House, but I want to ask one more question. In Aberdeen, we are fortunate in that we are not dependent on major industries as much as is the case in the industrial belt of Scotland. Nevertheless, we have one industry which employs one-sixth of our people—the fishing industry and its ancillary trades. Hon. Members will be relieved to hear that I have no intention of making this a fishing debate, because I think that there will be opportunities of a debate on this subject later.

I want to ask, however, whether the terms of reference of the Fleck Committee of Inquiry into the Fishing Industry are wide enough to take into account the effect of the actions of Iceland and the proposals of the Danish and possibly the Norwegian Governments for the extension of their fishing limits. This situation exploded after the Committee of Inquiry started its work and it would materially affect its conclusions.

Whether a large fishing industry in Aberdeen is economic or not, I suggest that this industry must be encouraged for strategic reasons, because it gives one-sixth of our people steady work and also because, in spite of a delightful gift of English fish which I believe I am to receive later this evening. I maintain that Aberdeen fish is best.

6.2 am.

Miss Margaret Herbison (Lanarkshire, North)

I shall not follow the arguments of the noble Lady the Member for Aberdeen. South (Lady Tweedsmuir). I intend to deal with some remarks made by the President of the Board of Trade, but I shall particularly direct my remarks to the Secretary of State for Scotland, because he is the Minister in the Government who is responsible for the well-being of Scotland.

On 14th June the Secretary of State for Scotland spoke at a Tory rally in North Lanarkshire. He was reported in the Wishaw Press on Friday 20th June. I have no reason to doubt the accuracy of that reporting. The Wishaw Press is a most reputable and very fair local newspaper. No doubt the Secretary of State was affected by the beauty of his surroundings, because the flights of his imagination were very great indeed, and the distortion of statistics which he produced in his speech has to be read to be believed. I will quote what he said. If he has been wrongly reported, no doubt he will tell us.

Mr. Ross

He will sack the editor.

Miss Herbison

This is how the report read: 'In recent years,' he said, 'the Government policy has been to concentrate on the black spots and in different areas in Scotland we are getting a full share of Government-financed factory building', Between 1952 and 1957, 40 per cent. of Government financed undertakings had gone to development areas in Scotland and during the last two years of that period had provided half the employment in those areas. Since 1957, and so far for the year 1958–9, Scotland had been getting three-quarters, in terms of value of all the Government-financed factories in the country. The Secretary of State was very careful indeed to speak only of Government-financed factories and in doing so he gave a completely misleading picture of industrial building generally and of Scotland's share in that industrial building. What my unemployed people in North Lanark and all those who are unemployed in Scotland want is work. They do not mind whether that work is in a Government-financed factory or in a factory provided through private enterprise.

I want to give the true picture of industrial building in Scotland. I have extracted the figures from an Answer to a Question which I put to the President of the Board of Trade and, since I received the Answer only last week, it is very much up to date. In 1945–51, during the years of the Labour Government, of all industrial building completed in Great Britain Scotland's share was 12.2 per cent. Turning to the years during which we have had a Tory Government, 1952–57, I find that Scotland's share fell from 12.2 per cent. to 9 per cent. What a different picture from the picture which the Secretary of State tried to paint to those people at Newmains in North Lanark.

The Secretary of State for Scotland (Mr. John Maclay)

I will deal with this matter fully in my winding-up speech, but perhaps I should reply now in case there is any misunderstanding. I have not studied the detailed report of my speech, but my vivid recollection was that I was dealing with the charge that the Government were not doing their best to help Scotland. I quoted figures of Government-financed factories. The hon. Lady is dealing with a different and wider subject. I think she will find that I kept strictly to the question of what Government-financed factories had been provided in Scotland. I can assure her and the hon. Member for Hamilton (Mr. T. Fraser) that had they been fortunate enough to hear my speech they would have found it absolutely clear.

Mr. T. Fraser

I had the misfortune to read the report of the speech.

Miss Herbison

The right hon. Gentleman's intervention makes the position perfectly clear. Of course, he was dealing with Government-financed factories. His intervention makes it clear that he accepts no responsibility for any other industrial building which goes on in Scotland.

Mr. Maclay

That is quite wrong. My intervention does not make that clear. I will deal with the matter at greater length in winding up the debate. It was not possible for my speech to be reported fully because I had no script, except for short passages. In its context what I said was quite clear.

Miss Herbison

I have no doubt that in its context it was quite clear. All I am saying is that by using these satistics and not the general statistics the right hon. Gentleman gave a misleading picture to the people in Lanarkshire who heard him and to those who read that report.

Mr. Fraser

Is my hon. Friend aware that about the same time a by-election was taking place in Argyll and that the Prime Minister wrote a letter to the Conservative candidate in Argyll using exactly the same figures? The Prime Minister gave no indication whatever of the small proportion of factory building in Scotland. He—

Mr. Deputy-Speaker (Sir Charles Mac-Andrew)

Order. I understand that the hon. Member for Hamilton wishes to speak later in the debate.

Mr. Fraser

I understood that my hon. Friend the Member for Lanarkshire, North (Miss Herbison) gave way for me to intervene. I think my intervention was shorter than that of the Secretary of State a moment ago.

Mr. Ross

And he, too, intends to speak later.

Mr. Deputy-Speaker

That may be so. Miss Herbison.

Mr. Fraser

On a point of order. You prevented me from making a point, Mr. Deputy-Speaker, because you understood that I intended to speak later in the debate. I submitted to you that my intervention was shorter than that of the Secretary of State, who also intends to speak later in the debate. In the circumstances, was I not in order in my intervention?

Mr. Deputy-Speaker

The hon. Gentleman is allowed to speak only once in the debate. It is usual for hon. Members on opposite sides of the House to give way to one another, but when two hon. Members on the same side play Mick and Mac with each other, it is going too far. Miss Herbison.

Mr. Fraser

I do not know what I was playing, but—

Mr. Deputy-Speaker

I have given my answer. It is in order for an hon. Member to speak only once in the debate, and I am the judge whether a person is speaking once or twice. For an hon. Member on one side of the House to give way to an hon. Member on the opposite side of the House is normal, but I do not think it is right for two people on the same side to play hand in hand with each other.

Miss Herbison

I am very sorry, Mr. Deputy-Speaker, but I am not quite sure that I heard your last statement. I think you mentioned speaking hand in hand.

Mr. Deputy-Speaker

Previously, I said "Mick and Mac"—playing together on the same side. I think that is wrong, if Members want to speak again.

Miss Herbison

My hon. Friend's intervention was very important and useful, because it is evident that not only the Secretary of State for Scotland, but, perhaps, the Prime Minister prompted by the Secretary of State for Scotland, has been trying to get this most misleading picture over to the Scottish people.

A comparison of that 12.2 per cent. in the years of the Labour Government with the 9 per cent. in the years of Tory Government shows a considerable fall, particularly when one compares it with other regions. The President of the Board of Trade said that he had to take a balanced view; that he had to take into account all the regions in Great Britain. I shall try to take into account some of the regions in Great Britain.

I find that at 14th April, 1958, the latest date to which I could get figures applying to the whole country, the unemployment rate in Great Britain was 2 per cent. In London and the South Eastern Region it was 1.3 per cent., which is the lowest percentage rate of unemployment in the whole of Britain. In Scotland, it was 3.6 per cent—almost three times as much. London and the South Eastern Region, from 1945 to 1951, under a Labour Government, got 7.1 per cent. of all industrial building, as against Scotland's 12.2 per cent. However, between 1952 and 1957 that 7.1 per cent. jumped to 14.8 per cent.—and that in an area that has never had as large an unemployment figure as we have had.

This Government have taken no effective steps to ensure that factory building goes to the areas needing it. They are quite content to see happening what happened between the wars—these factories growing up all round London, whilst Scotland and other Development Areas are being faced with great difficulty and serious unemployment.

Following the Secretary of State's speech, I looked at the very latest figure of building under construction, and that is given at 30th September, 1957. I find that London and the South Eastern Region, with an unemployment figure of 1.3 per cent., have 14,714,000 sq. ft. of factory building under construction. Scotland, with its 3.6 per cent. of unemployment, has under construction 5,353,000 sq. ft.—slightly more than one-third of what is being built in London and the South Eastern Region.

I turn now to my own constituency. The unemployment figures published apply not only to my constituency but to what is called by the Ministry of Labour "North Lanarkshire". That takes in Airdrie, Coatbridge, Motherwell, Wishaw and, possibly, the whole of the Bothwell constituency. From the latest figures, published yesterday, we find that the rate of unemployment there is 6.9 per cent. That is a very serious percentage indeed. It is over three times the rate for Great Britain as a whole, and that is the place where the Secretary of State chooses to make that kind of speech.

These figures will increase. We are very worried indeed in my constituency about the future. When I interrupted the President of the Board of Trade he said he did not deal with Lanarkshire because that was a place where there were heavy industries and, as trade picked up, things would be all right. That is just nonsense. I have in my constituency a very old steel rolling firm—Smith and Maclean of Gartcosh. I have here a letter from the trade union representative in that works, and this is the information he has been able to get from the management. In December of last year there were 1,100 people working there. There are now, in July, 900—a drop of 200.

The picture is even worse than that. Of the 11 mills, three are off, no longer working, and eight are working on short time. This trade union representative also says that three of the eight which are working, though on short time, are on a week's notice to stop working. That week's notice has been extended on three occasions. He finishes his letter by saying: Business is slow, and the future stated to be very obscure. That is the future as far as the management knows about it.

I have another firm, the Glenbois Fireclay Company. It makes refractory bricks for steelworks and, with the recession in steel, there is a recession in the brickworks. Only last week I visited that works, and it is possible that by next Friday 250 people will be out of a job. In another part of my constituency there is the Caldercruix Paper Mills, a very old-established paper mills. More than 100 of the workpeople there are to be paid off before the Fair holidays. The colliery at Shotts, Calderhead, finishes a week on Friday.

That is the picture of the constituency where the Secretary of State made that shockingly complacent speech. It is the picture, not only of my constituency but of what is obtaining throughout almost the whole of Lanarkshire, and the other places to which reference has been made. The unemployment is not confined inside my own constituency; many of my constituents work outside it.

There are many things that must be done to remedy this position for the whole of Scotland, and I say to the Secretary of State and to the President of the Board of Trade that it will not be remedied unless we have a return to conscious, purposeful planning. That is what the right hon. Gentleman scorned in that speech. He quoted my right hon. Friend the Member for Huyton (Mr. H. Wilson) and another of my right hon. Friends to show what a bad thing it would be if we had to have planning for Scotland, but it is only by conscious planning that Scotland will really have a future.

There ought to be a much more vigorous use of the Distribution of Industry Acts. It is so easy for the President of the Board of Trade to say that what industrial building is going on in London and the South Eastern Region is only for extensions, but I think that that is just nonsense, and that, by using the industrial development certificates, he could do much to help Scotland. Then there are the advance factory buildings. We are beginning to get a little tired of the President telling us that industrialists now want tailor-made factories. That was not my experience when the factory in Shotts became vacant. There, we had more than one good, reputable firm wishing to have it.

If the Government really went forward with the policy of expansion, I have no doubt that the building of these advance factories would be of very great use indeed in cutting down unemployment. Scotland's position will improve only if the Government really decide to have some worth while expansion. As a nation, we have suffered more from the credit squeeze and from high interest rates than almost any other part of the United Kingdom.

The Secretary of State spoke about production, and this is the report of what he had to say: With production up by one-third in ten years and efforts double pre-war, there were no signs that Britain was a decadent nation. In that part of his speech the Secretary of State was careful to talk about increased production over ten years, making no mention of exact figures like those for 1952–57, the kind of figures he used when he was talking about Government-financed factories. Indeed, he made no mention of the first part of 1958 in speaking of increases in production.

I shall repair the omission. Under the Labour Government, from 1946 to 1951, we had an overall increase of production of 34 per cent. Under a Tory Government, from 1951 to 1956, the increase was 16 per cent. No wonder the Secretary of State wanted to mention the years of a Labour Government when talking about production levels. It just was not quite honest, in a propagandist speech of that kind, to say that. To take the last two years, 1956 and 1957 together, there has been an increase of 1 per cent. in production over 1955. What a different picture this represents compared with the one painted by the Secretary of State.

I have here the report of his speech in the Wishaw Press. There is a lovely photograph of the right hon. Gentleman, and above it there is set out his statement, "North Lanark a highly marginal seat". If mine is a highly marginal seat from a Labour point of view, what is the Secretary of State's seat from a Tory point of view? Immediately underneath the report of the Secretary of State's glowing picture of the state of affairs in Scotland, the Wishaw Press had a paragraph, "Unemployed in the County". It was not malice on its part; it was just a place to put the information in. This is what it says: According to the latest Ministry of Labour monthly returns, Lanarkshire's unemployed has risen by 1,225 to a total of 10,282. This was in juxtaposition to the bright, lovely, but senseless picture presented by the Secretary of State.

Mr. Maclay

When I referred to marginal seats, I did say that I knew quite a lot about them from my own experience.

6.23 p.m.

Sir James Henderson-Stewart (Fife, East)

The hon. Lady the Member for Lanarkshire, North (Miss Herbison) has, as usual, made her case with great vigour and strength. There was a time when I was obliged to reply to her on behalf of the Government. Fortunately, I do not have to do that now. In any case, I wanted, in the few minutes which I shall occupy, to turn to two other matters.

The hon. Lady has, quite naturally, been dealing with her own area and its industrial and employment problems, and she has been dealing with the need for new factories. My part of Scotland is not a large industrial area, but, nevertheless, we have our troubles. I am thinking not of Fife generally, but of East Fife, which I regard as a typical country district in Scotland. There, too, we have seen and suffered from the results of the recession In two of the small villages there, old-fashioned linen mills have either closed or are closing. The same must be true in many other country areas throughout Scotland. Not a word has been heard yet on behalf of areas such as these. I am sure that my right hon. Friend has them in mind, but I wonder whether they receive the attention to which they are entitled. We have heard that there is a great concentration of power upon Dundee, the Board of Trade, the Scottish Council and the Ministry of Labour all bending their co-ordinated efforts in a determined endeavour to increase the diversity of employment there. I accept that, but when a small factory in a country district closes, surprisingly little happens.

I write to the Joint Under-Secretary of State, my hon. Friend the Member for Dumfries (Mr. N. Macpherson). He very courteously replies and takes the matter up at once with the Board of Trade and the Scottish Council. He does all he can, but the fact is that very little happens. I should like to see a representative of the Board of Trade or the Scottish Council, or of both, go quickly to places where this kind of thing happens and report on the situation so that somebody at the centre will then be able to take action.

Mr. Malcolm MacMillan (Western Isles)

indicated assent.

Sir J. Henderson-Stewart

The hon. Member for Western Isles (Mr. Malcolm MacMillan) apparently agrees with me that, in those out-of-the-way country areas, there tends to be neglect.

It is not deliberate neglect. It comes about because the organisations which are available have not the resources to cover the smaller areas as well. I wonder whether the time has not come for there to be an inquiry into whether the efforts of the Board of Trade, the Minister of Labour, the Scottish Council, the Scottish Office and the local authorities are sufficiently co-ordinated in their consideration of all these matters of declining local trade. I put that very seriously to my right hon. and hon. Friends, the Scottish Ministers.

We ought to create a better and more well-integrated machine which will act more quickly.

Mr. Bence

It will need powers.

Sir J. Henderson-Stewart

Certainly it would have to have some power, but I do not suggest what.

It has become almost a cliché in the House to say that justice must not only be done but must be seen to be done. So with Scottish Ministers. They must not only feel anxiety—I am sure they do—but they must demonstrate their anxiety by action. It must be shown that they are taking steps to remedy troubles.

I give another example. In Anstruther, along the fishing coastal strip, there has not been the closing of a factory but there is a need for additional employment. Anstruther Town Council writes to the Scottish Council to ask, "Is there any chance of our having new industry?" A polite reply is sent, but nothing else happens. This is because the Scottish Council has not the resources to do more. I blame nobody. I am merely saying that we do not seem to have in Scotland a sufficiently powerful, co-ordinated central machine for watching the decline in trade and for taking action where it happens, bringing all the nation's energies to bear upon it.

Turning to the other side of the picture, I wonder whether, for its part, the Scottish Council really knows about all the firms which might possibly come to these needy areas. I wonder whether the Board of Trade knows, and I wonder whether my hon. Friend the Joint Under-Secretary of State knows. Is not co-ordination needed on that, as it were, supply side of the matter? At any rate, I suggest that it is well worth inquiring into.

As I say, it is not only necessary to show anxiety. The gradual decline of the shale oil industry in the Lothians is an example of the lack of demonstrative anxiety which troubles me very much. I would not have raised this matter again today if it had not been, I am sorry to say, for an extremely disappointing Answer given by my right hon. Friend the Chancellor of the Exchequer a few days ago.

Mr. Willis

It was shocking.

Sir J. Henderson-Stewart

I am sorry to have to say that, because I have a great admiration and affection for my right hon. Friend. I think that he is a first-class Minister; but he has not been well briefed on this matter. I noticed that more than once in his speech the other night he said that he could not do something on present evidence or as presently advised, which I take to mean he has not been well advised or has not been given all the evidence which he ought to have. If anyone ought to give him the information, it is surely the Scottish Ministers. That is why I think I am in order in suggesting to my right hon. and hon. Friends, with the greatest respect, that they have a duty to perform.

The Chancellor of the Exchequer used what I call the usual rather threadbare Treasury arguments. The principal argument was one that we have heard so often, but he put it in perfectly plain language. He said: The blunt fact is that the production of oil from shale in Scotland cannot compete on anything approaching equal terms with imported oil. That view could be expressed in another way by saying that the mining and processing of shale is an inherently expensive way of producing oil. That is quite true. But so is a large part of the agricultural production of this country. Because it is much more expensive to produce here than abroad, we do not allow the growing of wheat or dairy production to languish. We decide that in the broad national interest, taking everything into account, it is necessary to set aside those otherwise sound, financial, economic arguments and support agriculture.

I support agriculture. I support all the measures, financial and otherwise, that are introduced in this House, and I cannot for the life of me see why we accept the principle of making an exception in the national interest in one instance but reject the principle here.

Mr. Woodburn

Would the hon. Member agree that on that principle great parts of the Highlands would be left desolate if we were to take the mere economic factor as the deciding influence?

Sir J. Henderson-Stewart

That is what I am trying to say. I know that we cannot press the issue too far.

I suppose that it could be said that shale oil and agriculture are not comparable. We produce about half of our agricultural requirements. In the event of war, it would be a terrible thing if that half were not assured. In the case of shale oil we produce only a fraction of our total requirements. Therefore, I do not wish to press the comparison too far. But a principle is involved here, the principle being that we cannot take a narrow financial, Treasury, economic view of a matter when broader national interests are concerned.

What are those broader interests? The Chancellor said: I recognise straight away, that this industry has been the mainstay of employment in West Lothian."—[OFFICIAL REPORT, 2nd July. 1958; Vol. 590, c. 1461.] That is still the case. The Chancellor recognised that there are now 2,300 people engaged in the industry. The hon. Member for West Lothian (Mr. J. Taylor) told us the other day that in the last two years 1,000 men had been paid off. That is a serious matter for Scotland and The Lothians. That is an example of a broad national consideration that must be taken into account.

I therefore plead with my right hon. and hon. Friends in the Scottish Office to look at this matter again. We may dress it up in any way we like, but the plain truth is that this is a dying industry because we are taxing it out of existence. The Chancellor is quite right in saying that the Excise duty is only half of the Customs duty on imported oil, and if one adds the difference over the last so many years one gets a vast sum amounting to millions of pounds. That is all right statistically, but it does not face Scotland's present industrial plight.

I do not take the view of the hon. Member for Leith (Mr. Hoy) in, if I may say, his somewhat exaggerated language when he spoke about the desperate plight of our country, the bleak outlook and other phrases which he quoted from a Church authority.

Mr. Hoy

It was a quotation from a committee of the Church of Scotland.

Sir J. Henderson-Stewart

I am sorry; I meant to say that I thought that the quotation he gave from the gentleman who spoke in a committee was an exaggerated phrase. He was a representative of the Church Committee. I am hoping to agree with the hon. Member.

While we do not want to exaggerate the black side of the picture, it would be equally wrong to exaggerate the bright side and pretend that there is no trouble. There is trouble, and I give the Lothians as an example. It cannot be right at this time, when there is heavy unemployment in Scotland, for the Government to countenance the extended and continuing decline of what is an old-established industry which employs between 2,000 and 3,000 people.

When I was in office I was shown over the establishment, and I must say that I was much impressed with the calibre of the management and men. The relations between management and men have been good over the years. I think that there is a very fine body of Scotsmen there. I recognise that it would not be much service to the industry if we granted remission of Excise duty and, at the same time, there was an immediate demand for wages that ate it all up. There would be no sense in that at all.

Mr. John Taylor (West Lothian)

I welcome the support of the hon. Gentleman. When he was not reappointed to the Government I said that the Scottish Office had blown its brains out, and he has proved that to my satisfaction this afternoon.

I should like to reassure the hon. Gentleman on his last point. I think he can take it that there is not a body of men in any industry in Scotland which has co-operated more closely with the management than that in the shale oil industry. Indeed, the men have sacrificed a great deal and worked at lower rates than people in comparable industries, and they would play ball if they had the co-operation of the Government.

Sir J. Henderson-Stewart

I am sure that we are all glad to have the assurance of the hon. Member. I was only noting the slight danger that, if a remission of £750,000 a year in tax was made and it was eaten up in the next year by a substantial increase in wages, the whole point would be lost. Clearly, labour as well as management would have to co-operate. I believe that they would co-operate.

Therefore, I make the plea with confidence to my right hon. and hon. Friends that this is a matter in which we must take a broader view than the Treasury view. I, like I am sure a great many other Scotsmen on the Government side, will be greatly disappointed if the Government sit back and let this old-established and still important industry, which is, the life-blood of the centre of Scotland, gradually languish. That would be a very bad thing for Scotland, and I hope that the Government will not allow it to happen.

6.38 p.m.

Mrs. Mary McAlister (Glasgow, Kelvingrove)

The outstanding thing to me in any consideration of industry and unemployment in Scotland is what I can only call the consistent complacency of the Government. That is all the more extraordinary when we realise that hon. Members opposite who represent Scottish seats have the interests of Scotland at heart. There is no doubt about that.

The hon. Member for Fife, East (Sir J. Henderson-Stewart), together with his hon. Friend the Member for Caithness and Sutherland (Sir D. Robertson), plainly came out on the side of the Lothians last week in the debate on the shale oil industry. The hon. Member for Fife, East, who has come out even more plainly today, said that it was difficult to be complacent, or words to that effect, about the fate of the shale oil miners. Unfortunately, however, he then went on to say that the recession or contraction, or whatever one likes to call it, seemed to be more intense north of the Border than south of the Border. It does not merely seem to be more intense: it is more intense. I sympathise with the hon. Baronet in not wanting to embarrass the Government, but facts are facts.

When I fought the Kelvingrove by-election, last March, all sorts of fancy adjectives were being applied to the rising unemployment figure. We were told that it was transitional, that it was seasonal and that it was this, that and the other. It was, in fact, called by anything but its proper name—straightforward unemployment, or the beginnings of it.

Now we are hearing again about contractions, recessions, or whatever the Government like to call them. The man who gets his "book" does not much mind what it is called. He calls it the "sack". He is a simple soul and is neither a politician nor an economist. He does not know what else to call it. He can scarcely be blamed if he sees the writing on the wall, even if he is still in work, and feels that he will shortly see a return of the story which we knew before the war, when skilled British craftsmen stood not for weeks, or for a short season, but for years in hopeless queues. He can hardly be blamed if he now sees the writing on the wall, even if he is still in work.

The unemployment figures are rising. Despite assurances which we have been given, they are rising in trades which normally should be working at this time of year. I got figures yesterday about the unemployment of painters. I admit that, arithmetically, the figure is not a formidable one, but when I tell hon. Members that the unemployment of painters in Glasgow today is approximately 300 per cent. more than it was a year ago, we cannot look at this matter with complacency.

One of the reasons for the Government's refusal to help the shale oil industry—I do not want to repeat it all, because this was thoroughly thrashed out last week; I mention it only because it is typical—was that it was costing £5 per man per week to keep these people in employment. I have not had time to work out the figures, because I am a fairly busy woman, but I wonder what it costs to keep a man in prison or a boy in Borstal. Surely this figure must be put against the possible cost that must be met when these men are thrown on the scrapheap.

I was glad to read the Church of Scotland Report, pointing out that the Government have a moral as well as an economic responsibility. I do not want to labour the case any further, because many remedies have been suggested. It is time that the Government got on their toes and did something about the industrial situation in Scotland.

6.43 p.m.

Sir James Duncan (South Angus)

The hon. Member for Kelvingrove (Mrs. McAlister) accused the Government of complacency. I do not believe her complaint to be justified, particularly concerning my part of the country, near Dundee. I hope that the hon. Lady will not consider me complacent, either, if I try to bring some sort of balance into the debate.

The hon. Member for Leith (Mr. Hoy), as, I suppose, was his duty, speaking for his party from the Front Bench today for the first time, on which I congratulate him, tended to exaggerate the pessimistic side. That is his duty, as it is the duty of the Opposition. To get the picture into perspective, however, it is only fair to say that business is not as bad as all that in Scotland.

Mr. Willis

It is for 77,000 people.

Sir J. Duncan

We will come to that later.

If we compare the unemployment figures of Scotland with those of any other free country—

Mr. Willis

That does not help the 77,000 unemployed.

Sir J. Duncan

Will the hon. Member wait a moment? It will add up eventually to something constructive.

We have stood up to this recession in Britain, including Scotland, better than any other nation. Reading the survey of economic conditions in Scotland in 1957 published by the Clydesdale and North of Scotland Bank, one sees all the way through that business on the whole has not been too bad. In the iron and steel industry the output of pig iron and ferroalloys rose substantially and proportionately by more than for the United Kingdom as a whole, while the output of crude steel rose by 4 per cent. to a new record level.

Mr. Ross

Surely the hon. Gentleman—

Sir J. Duncan

I really have not started and I am not giving way yet.

The engineering industry generally was fully employed. Satisfactory trading conditions persisted in most sections of the chemical industry and its overseas business tended to rise. These are merely illustrations of what I mean when I say that, on the whole, business in Scotland and the unemployment percentage were better than in most countries, in spite of a recession in world trade.

I want, however, to devote myself to one of the black spots. Like the hon. Member for Edinburgh, East (Mr. Willis), I am quite prepared to admit that there are black spots. The industry of which I wish to speak is the one of which I spoke last year, the jute industry. When it reported in 1947, the working party said that A wide range of industries is dependent on jute production either as a packaging material or as a component in the manufacture of other articles, and it would be unwise in the national interest to allow these industries to become more and more dependent upon a single source of supply. The working party, therefore, recommended that protection to the industry should be continued conditional upon its becoming efficient.

How efficient has the jute industry become? With roughly the same labour force, output has increased by 45 per cent. On reorganisation and modernisation of its factories, the industry has spent £12 million. I believe that it can generally be said now to be an efficient, modern industry. It has, therefore, fulfilled the conditions proposed by the working party. For this reason, it is entitled to continued protection and consideration from the Government.

The hon. Member for Dundee, East (Mr. G. M. Thomson) quoted one of the pledges given by Ministers in the past. In a debate in another place, a few days ago, Lord Woolton's pledge of 1954 was quoted. I have here a record of six pledges made by Ministers in the past. There is one made by the present Chancellor, when he was at the Board of Trade, four by my right hon. Friend the Member for Newport (Mr. P. Thorneycroft), when he was President of the Board of Trade, and one by Lord Woolton. They all boil down to stating that until the Government can find an alternative measure to secure the prosperity, efficiency, output and employment of the industry, protection should be continued.

I want to remind and hold the Government to these pledges. I will give them the dates in writing later, to save time now, but I remind them that these pledges still stand and that my right hon. Friend the President of the Board of Trade, without breaking up the whole industry and dishonouring the past pledges of his own colleagues, cannot run away from those pledges today or in the future until he can give equivalent protective guarantees to the industry. That being so, I was a little disappointed last year when the mark-up was reduced, but I was quite prepared to accept that there were good reasons for doing so. I recognised at the time, and prophesied at the time, that it was bound to have an impact on the employment situation in Dundee and district.

I represent the district Up to now, factories using jute outside Dundee have been more fortunate in retaining their businesses than have those in Dundee itself. But one cannot speak for one's own constituency only in connection with an industry of this kind. One has to speak for the whole industry, because if Dundee gets into a mess the country districts outside will get into a mess, too.

When I spoke last year there were 983 reported by the Ministry of Labour Gazette as unemployed in the jute industry on 18th July last. The latest figure for 12th May for the jute industry is 2,173. When I spoke at this time last year, 19,500 were employed in the industry. The Ministry of Labour Gazette now says that there are only 16,200 employed in the industry. If these figures are compared, it will be seen that 527 people have disappeared from among them. They are not recorded as either employed or unemployed. They have gone away.

Where have they gone? I know that sonic are married women who are no longer registering for employment. Some have left for other trades. Some have migrated to England or other parts of Scotland or overseas. If we are to watch this contraction of the jute trade, we must be clear about the figures. We talk of 15 per cent. unemployed based on an employment figure of 16,000 hut, as I work it out, the unemployment rate is only 10 per cent. and not 15 per cent. We should be careful what we are talking about when we are discussing these figures.

The disturbing point about the latest figure is that whereas last year jute unemployment represented only a quarter of the unemployed in the Dundee district, today it represents two-fifths. Therefore, the step which the President of the Board of Trade took last year has not only reduced the number of employed people by 3,000, increased the number of unemployed and driven some people out of the trade altogether, but it has caused a great deal of uncertainty in the industry for the future.

To be fair to my right hon. Friend, the Clydesdale Bank does not list that uncertainty as the first of the reasons for the increased disturbance of the trade. It says, in its review: The principal reason for consumers restricting demand to their immediate needs and, therefore, for a reduction in production was the maintenance of high prices for raw jute. I mentioned this last year and nothing seems to have happened since. One of the greatest difficulties that the employers have is in buying the various qualities of raw jute which they require at reasonably stable prices. In the last month or two for instance, the price of mill firsts has varied from £123 a ton to about £94. That large range of prices makes it impossible to quote prices for the delivery of goods.

During the last immediate period buyers have been holding off buying raw jute because they have expected a fall, and that, in turn, has affected employment. It is only now that the drop in prices has gone as far as they think it will reach that we can hope that buying will pick up again and employment will temporarily increase. The world recession, of course, is another reason for the disturbance in the trade, but there is no doubt that the uncertainty caused by my right hon. Friend's decision last year was also a factor.

I want, therefore, to press most strongly, as the hon. Member for Dundee. East did, for an assurance from the President of the Board of Trade that the present method of protection and percentage mark-up will not be further reduced until at least new employment has been brought to Dundee and set in motion. It is no good talking about setting up factories which in two or three years' time will employ 2,000 people. I congratulate the Government on the success of their efforts, in face of world recession, in getting six factories and two extensions into the area, but they are not working yet.

It was last July that the blow fell. The hon. Lady the Member for Lanarkshire, North (Miss Herbison) spoke of purposeful planning, but it depends on the plans. If we are to have Government planning, as we are in this industry, let it be good planning. It seems to me that in this planning the factory should be working before the mark-up is reduced. Personally, I prefer private planning to Government planning, but there has been a great deal of Government planning, with industrial sites and with Government assistance, financial and otherwise. But it started at the wrong end, and I would like my right hon. Friend to give a flat assurance to the industry that until new employment is available there will be no further tinkering with the industry.

My last point is about the Montreal Conference. I think that it will be the view of the jute industry that it does not want jute to be officially on the agenda of the Montreal Conference. None the less, the problem of Asian competition will, I hope, be discussed in the broadest terms by the Commonwealth Ministers when they get there. In any case, I do not want any decisions to be taken at that conference which would bind Her Majesty's present Government, or any future Government, in such a way that they could not continue to protect the industry in the future.

At present, the future is largely unknown. The Common Market is not yet in action. The Free Trade Area is not yet set up. We know that, in general, it will be of great benefit to British industry. We know, also, that it will be difficult for the textile trader, faced with Asian competition and Indian trade agreements, to compete with either Indian or continental competition.

I suggest to my right hon. Friend that this matter should be discussed, but that he should retain his freedom of action, after Montreal, to deal with the question of Asian competition—whether it be in cotton, whether it be in jute—on its own merits, and not tie himself or any future Government in such a way that the industry could no longer be protected.

7.2 p.m.

Mr. George Lawson (Motherwell)

As I listened to the hon. Gentleman the Member for South Angus (Sir J. Duncan) speaking of the position of the jute industry and the measures that ought to be taken, I thought that on this subject he should be speaking from these benches. It is significant, when hon. Gentlemen opposite are vitally concerned with a question affecting their own industry, and when they appreciate the realities of the situation, how near the solutions they propose come to those proposed by hon. Members on this side of the House.

I want to put this thought to all hon. Gentlemen opposite. We have been talking today about Government action in Scotland, and we shall continue to speak about this because we think there will be not much future for Scotland unless there is Government action on the position of industry. But hon. Gentlemen opposite might make an approach to Scottish businessmen, and instead of talking so much about business coming into Scotland might suggest that the Scottish businessmen themselves should do something about the position in Scotland.

For example, I wonder how many hundreds of millions of pounds there are in Scottish insurance companies and in Scottish investment trusts whose control is situated mainly in Edinburgh? I wonder how much of the money so controlled is invested in Scotland? That is a question at which hon. Gentlemen opposite might well look. A great deal could be done for the future of Scotland with those hundreds of millions of pounds emanating from Scotland and controlled by people mainly in Edinburgh.

I regret that the hon. Baronet the Member for Fife, East (Sir J. Henderson-Stewart) has gone out of the Chamber, because I shall refer particularly to a point he made, and with which I felt a great deal of sympathy. I am not referring to the position of shale oil, which has been dealt with. The hon. Baronet spoke of the activities of the Board of Trade in Scotland and awarded a great deal of praise to that Department. I endorse that praise. However, he had some feelings about weaknesses or deficiencies in the organisation of the Board of Trade in Scotland and it is on that I shall speak briefly.

For some years after the war, the Board of Trade in Scotland had the co-operation of the personnel of the Ministry of Supply. Those with whom I am concerned were engineers, and their business was to know the industrial set-up of Scotland. I am speaking particularly to the President of the Board of Trade, so I hope he will pay attention to this. Those engineers advised the Board of Trade. There existed a complete list of the firms and what they did. The firms could be given expert advice by those engineers. We know that this part of the Ministry of Supply was wound up and that the engineers became attached to the Board of Trade. For a period they worked with the Board of Trade, giving advice to industry in Scotland. For example, they would give advice to one firm in Scotland that another firm there could make the components which the first firm wanted. In this way much work that would otherwise have gone out of the country was retained within it.

As I understand the present position, there are no engineers attached to the Board of Trade in Scotland, for the Department is administrative and has no personnel to give that essential advice. So in rendering what would seem to me to be almost the major service for which the Board of Trade in Scotland exists, namely, of enabling the best use to be made of existing industry in Scotland, there is no medium by means of which advice on one firm can be given to another firm.

The new industries which have been set up in so many cases have, through lack of knowledge of what could be done in Scotland, sent orders out of Scotland for the various components they require; not all, but this has been happening and seems to be happening increasingly. Therefore, I make a plea that there be returned to the Scottish Board of Trade some engineering personnel to enable the Board of Trade in Scotland to overcome that deficiency.

I turn to matters which more particularly concern me. One must speak briefly because so many hon. Members wish to take part in the debate. I shall speak of the position which has grown up rapidly in my constituency, namely, part of North Lanarkshire, the Burgh of Motherwell and Wishaw. It might be taken as the centre of the steel industry. I know that other hon. Members have large parts of the industry in their adjacent constituencies, but North Lanarkshire is a large part of the heart of the industry of Scotland.

The position has worsened rapidly. The very rapidity with Which the growth of unemployment has shown itself is alarming and significant, and note should be taken of it. I noted that the President of the Board of Trade was inclined to pass over the position in Lanarkshire as being not so disturbing as that in Dundee. Greenock and other parts, on the ground that the difficulties which had arisen were a product of the general depression and that, with the steps being taken to lift the general depression, there would be immediately an alleviation of the situation existing in the area of the steel industry in Scotland.

I am not so sure of that. Between June, 1957, and June, 1958, unemployment in my constituency increased by 120 per cent.—more than double. We are not now talking of rural areas. I appreciate the importance of employment in those areas, but we are talking about the heavy industry area of central Scotland.

Mrs. Mann

As I am not likely to have a chance to take part in the debate, may I point out that unemployment in Coatbridge and Airdrie has risen by 350 per cent.?

Mr. Lawson

My hon. Friend will no doubt be able to speak for herself. Her reference is to part of the general area and part of the same problem.

I estimate that we may have about 7 per cent. unemployment in the Mother-well-Wishaw area. That estimate may be questioned. I know that unemployment figures are calculated in a different manner from the way in which the insured population in an area is calculated. There are substantially more people working in Motherwell and Wishaw then the total of insured population living in that area. It is an area which draws to itself a substantial number of workers.

I am talking at the moment in terms of unemployed resident within the area, and it is on the basis of a calculation of the proportion of people of Motherwell and Wishaw who are likely to be among the insured population that I reach my figure. Even if my figure errs it cannot be far out because we know that the unemployment figure for the whole of North Lanarkshire is 6.9 per cent. The importance of the problem can thus he appreciated.

The rapidity with which the situation has arisen indicates how precariously balanced the Scottish economy is. This has happened with a comparatively mild depression. The national unemployment figure is 2 per cent. Yet my area has been so rapidly affected by a seemingly very mild depression. What would it be like in the area if there were a serious depression in the country? What would be the position in North Lanarkshire if the shipbuilding industry hit hard times? We can appreciate what is threatened. At present the shipbuilding industry is very busy and the heavy sections of the steel making industry are very busy meeting its demands. Howevere, the shipbuilding industry is very precariously placed, and if the falling off of orders continued what might be the position?

Out of the falling off in the demand for steel arises another puzzling question. In its magazine Colvilles, which is, in effect, Scottish steel, admits that there is a depression and attributes it largely to what it calls a de-stocking crisis. I find this de-stocking crisis a little puzzling. Over the years there has been a very great scarcity of steel, more so in Scotland than in other parts of the United Kingdom. How is it that firms have been able to build up such vast stocks of steel that they can live on them? I cannot understand it.

Mr. Maclay

I think it fair to say that it is a phenomenon of periods of shortage that firms build up stocks. That has always happened. It is inevitable.

Mr. Lawson

Have the firms been getting stocks of steel from abroad? A spokesman of the Motherwell Bridge Company said that it had had to go to East Europe to get stocks of steel. Have firms been entering into long-term contracts with German or American makers of steel?

Mr. Maclay

It is a world-wide problem. It is our export orders as much as anything which are causing trouble at the moment. The problem applies not only to this country but to steel users all over the world.

Mr. Lawson

I agree that it is a worldwide problem, but these engineering and shipbuilding firms are still working busily and using as much steel as they ever were, and yet apparently they are having no difficulties about supplies of steel. Are they getting supplies from abroad? Have many of the firms entered into long-term contracts to obtain supplies abroad because the Scottish steel making industry was unable to meet their needs? That is the sort of statement which has emanated from at least one very prominent firm which I could name. I wonder whether we shall be given an answer to the question. Can we be given an explanation of a statistical nature to show hon. Members how far behind Scotland has been in meeting her steel needs?

The Scottish steel making industry increased the production of crude steel between 1948 and 1957 by a little under 18 per cent., but in that period the Scottish general manufacturing industry stepped up production by 33 per cent. Scottish steel has thus been lagging very far behind the rate of development of general manufacturing. If we take the steel using industries such as engineering, shipbuilding and electrical goods, their production over that period has increased by 51 per cent. How has Scottish steel been meeting the needs of Scottish engineering, shipbuilding and other industries when Scottish steel production has expanded by only 18 per cent. and the other industries have increased production by 51 per cent.? It just has not been done and is not being done.

The Government have a responsibility for the steel industry through the Iron and Steel Board. There is a responsibility for development of the steel industry. There is a responsibility for investment in the industry. I know that there has been a great deal of investment in the Scottish steel industry, but there has been much more investment in the industry South of the Border and in Wales. The industry South of the Border has been developed to a far greater extent in proportion to the industry North of the Border.

Between 1948 and 1957 the United Kingdom industry has increased production by 46 per cent. while during the same period the Scottish industry increased its production by barely 18 per cent. I know that a great deal of work has been done. There are now excellent plans in Scotland, and there are many devoted and skilled people who are giving this matter their attention. Nevertheless, we ought to have an explanation why Scottish development has been proportionately so far behind that of the rest of the United Kingdom. The President of the Board of Trade looks at me as though he has an answer. If he has, I should like to know it. Has it been, for example, that the Scottish steel industry has been denied coking coal at any time? If so, it would be a good thing for us to know about it.

Here, then, we have a point of major importance to Scotland. The economy of Scotland is still based upon heavy industry. While much has been and will be said about new industry—and I endorse what has been said about that—we must see to it that existing industry is developed in every possible way.

I want to refer finally to the recruitment of new workers. There has been much talk about the need for technicians and scientists of the higher degrees of skill, and we can all agree that they are necessary for the economic future of the United Kingdom. However, it is also essential to have a growing number of craftsmen, a growing number of the skills which may be classed as being of the lower levels although whether that is the case is questionable.

The position in Scotland is alarming, and I will give an illustration which brings out the position clearly. The general manager of Metropolitan-Vickers in Motherwell described to me his firm's apprenticeship scheme. I understand that this is one of the finest schemes in the United Kingdom. It is also run by Metropolitan-Vickers in Manchester and elsewhere. The general manager of the Motherwell firm told me that he had had applications from boys who had already served a pre-apprenticeship course and who had thus proved themselves to be worthy. He said that the number of applications was three times greater than the number his firm could take.

He asked me what happened to the boys who were unsuccessful in their applications. They were excellent boys, but his firm could take only one in ten. I made inquiries of the youth employment officer, an excellent and devoted worker. However, he could not give me very much information on this subject, although I do not blame him for that. The fact remains that jobs as potentially skilled engineers were not available for those boys, with the result that they must have been going into all sorts of unskilled work.

There is no point in talking about the need to produce skilled workers at the higher levels if we cannot produce sufficiency at the so-called lower levels. We shall need at least seven to eight times the number at the lower as at the top levels, but we are not getting those numbers. There is a great demand for facilities for skilled work in this industrial area of Scotland and there are reasonably good education facilities, technical schools and so on, although we want more.

However, engineering firms in the area are not providing the jobs for these boys. This is not a case of the trade unions holding back. In fact, only last week I heard the A.E.U. organiser deploring this very fact and talking of the co-operation which the union had given in this matter. The snag does not come from the trade unions, but it is clear that many employers are not co-operating in providing jobs for boys who want to become skilled. That is a very serious matter for the future, and the Secretary of State must give special attention to it.

Those are my two main points. I hope that the right hon. Gentleman will appreciate how precarious the Scottish position is, as has been shown so clearly when we have had what has been called a very mild depression with already 7 or 8 per cent. unemployed in this industrial area of Lanarkshire. Let the right hon. Gentleman come forward with appropriate measures to deal with the problems which are facing us. Let him also consider this problem of the youngsters, the engineers of tomorrow, whose numbers will greatly increase over the next few years, and let him tell us what he proposes should be done about it.

7.25 p.m.

Mr. J. C. George (Glasgow, Pollok)

I am glad to follow the hon. Member for Motherwell (Mr. Lawson). During my speech I will deal with some of the points he raised, for the worries which he described have exercised my mind for some time.

The hon. Member for Leith (Mr. Hoy) and the hon. Lady the Member for Lanarkshire, North (Miss Herbison) railed against the credit squeeze and described how this country had suffered from it. I wonder what the country would have been like today if we had not had the credit squeeze. In September, very courageous action was taken after ten years of false prosperity. We decided to have a stable £, if that could be achieved, and we have gone well on the way to getting it. We decided to have steady prices, and we are well the way to achieving them.

If the hon. Member and the hon. Lady do not like that, I tell them that the country likes it. The News Chronicle Gallup poll yesterday—and that newspaper is not notoriously Unionist—forecast that the Conservatives would be returned to power if there were a General Election tomorrow. [HON. MEMBERS: "Resign."] That is the result of the credit squeeze. The country realised that something had to be done and that action had been too long delayed. Action was taken, it is meeting with success, and the country likes it.

It is wrong at any time to exaggerate and it is wrong to give the impression that Scotland is in the position described by the hon. Member for Leith. He used many phrases to describe the position and my hon. Friend the Member for Fife, East (Sir J. Henderson-Stewart) mentioned a few of them—"black spot", "general debility", "desperate plight" and "appalling position".

It is wrong to exaggerate and it is wrong to minimise. I shall not minimise, but I think that the position has been exaggerated. As Scotsmen, we must see the position of Scotland in its proper light. Scotland is not suffering from general debility. Hon. Members have only to look at the schemes which the President of the Board of Trade mentioned. Capital development schemes are running on a huge scale. The coal industry is being renewed at a cost of £185 million. The steel industry is being rebuilt at a cost of £60 million. Incidentally, I hope that the coal industry is a success, since it is in a bad state at the moment.

Miss Herbison

It is better than when we took it over.

Mr. George

No, it is infinitely worse. I am being forced to deal with the industry and I meant only to deal with its capital development. It is losing £1 million a month, and it did not lose that by any manner of means before nationalisation.

However, I want to stick to the figures of capital investment and to show the Scottish people what is happening. The coal industry is still being developed. The shipbuilding industry is spending millions of pounds on reorganisation. The railways are being reorganised and new roads are being built. The electricity industry has plans for developments all over Scotland, both nuclear and hydroelectric, and we have seen great housing schemes, schools and hospitals built all over Scotland.

That is the position today and it does no service to Scotland to denigrate what has been done and to paint a black picture. The unemployment figures do not justify the expressions which came from the hon. Member for Leith. As my hon. Friend the Member for South Angus (Sir J. Duncan) said, we have the lowest unemployment of any free country in the world. Scotland's position is not desperate.

On 16th June, the number of unemployed was 76,000. Of those about 9,000 were temporarily unemployed, about 14,000 were married women and there were 14,000 vacancies. That position is not desperate. Inside that position we have the two black spots of Dundee and Greenock.

Miss Herbison

Lanarkshire.

Mr. George

I am coming to that; the hon. Lady always wants to make my speeches for me. The position in Dundee and Greenock has been given undue publicity. The position there demands attention, but the worst position is that in the Development Areas. The figures for Scotland would be infinitely better but for those of the Development Areas. Since February, 51,600 men and 4,600 women have been added to the unemployed list. The unemployment position in Dundee and Greenock has been static over the last five months. Attention must be given to the position in Dundee and Greenock, but the serious increase in unemployment to which I draw attention is among boys and girls. There are unemployed 2,300 boys and 1,700 girls. That brings us to the big problem which is coming to Scotland in the near future. I will come back to that matter, and deal with it on the lines mentioned by the hon. Member for Motherwell.

In Scotland we are apt to talk in a fashion which gives the impression that Scottish affairs can be insulated from national and international affairs, but we cannot contract out in industry. We are suffering, as the President of the Board of Trade said, from world conditions, and one of those conditions might very well become worse. The U.S.A. and Canada have been in recession; who are we to say that it has completely passed and will not float across here? We suffer from import restrictions in many parts of the world. Demands are coming to industries for extended credit which in many cases cannot be met. These are problems outside the control of the Government and of Scotland but they affect the Scottish position. We need not try to deflect them; they will force themselves upon us.

Every week we hear tales of people who are losing business because they cannot give two, three or five years' credit. Her Majesty's Government have to study these things. Other Governments are helping their industries to get business back by assisting them with credit. We are losing orders every day. Scotland, therefore, cannot contract out of world conditions, because they affect employment in Scotland. The real cure is a rising trend of world activity. We may patch things up here and there, but rising world activity is the cure, which needs more than ourselves to bring it about.

Look at the position just ahead of us. I read this evening what the chairman of the National Coal Board said about home demand. It presents a sombre picture. In home demand coal faces an estimated fall which may be as much as 7 million tons. Total exports are already 2 million tons down this year. The coal industry would appear to be right amid the difficulties at the moment, and it probably will have idle time in the summer months. The result for the Scottish employment picture is that we can no longer look to coal to absorb extra people from Scotland.

In steel, the hon. Member for Motherwell has painted a picture of exports already 13 per cent. down. I saw a report in an evening newspaper that production is down by 10 per cent. already this year. People are doing their utmost to get stocks so as to save themselves expense. When steel prices fall, they stock up so as to take advantage of a rise. These stockings present a serious problem. There is a £4 million stock in the country today, when even a drop by 1 per cent. in production would mean a drop of 1 million tons.

I was looking at the iron and steel position, from the point of view of taking more people. This industry has increased its output with fewer men. I am told that the new expansion will mean no appreciable difference to employment. Shipbuilding is in the same position, full of alarm at the credit position. I have a letter here. I am not able to give the name of the shipbuilder who wrote it, but it says: With regard to future prospects, these have deteriorated. The number of inquiries for new ships has diminished, cancellations have taken place and discussions concerning possible further cancellations or postponements of orders are known to be taking place. World competition has greatly increased and in some cases with completely new yards embodying all the most modern practices. We therefore cannot look to shipbuilding to help us with our employment problem.

It adds up to this, that in the immediate future the basic industries will have serious short-term trouble. The outlook in the long future is obviously bright, because we shall not remain for ever in depression when we have re-equipped ourselves to deal with the new position when the time comes. It may be that the Chancellor of the Exchequer will have to do more than he has done, although he has taken the first step towards steering the economy for a forward move again. It is time to do some other bold thing in order to help the internal position in this country, in relation to the world position.

Let us look at the idea of bringing in new industries, about which so much has been said. We can congratulate ourselves about what we have done, and we are doing as well as we can. The chairman of the Scottish Council has several times made statements on this subject. I should like to see them contradicted, because many visitors to this country have so much trouble when they come here that they get fed up and go away again. It takes much too long to get a job done. Holland is getting far more industries to go there than we can get to come here. In the last seven years Holland has had 250 new industries. I am told that they are getting applications from British firms.

Mr. Lawson

Are any Scottish firms, or Scottish money, going to Holland?

Mr. George

I do not think Scottish firms are involved. My hon. Friend the Member for Fife, East asked for more co-ordination; that is what is happening in Holland. When a foreign firm goes to Holland it is dealt with by only one Department. Everything is done through that Department. I have an instance here to show that one major American firm went to Holland. Its representative was seen, and two months afterwards its first appliances were set up in that country. It is a major factory in the country today. There is only one Department dealing with everything, one institution, mainly concerned with Government finance, with the sole duty of bringing new industries into the country. Cannot we do the same thing here and so make a positive contribution? I will leave this subject, because time is short.

The days when the fishing industry was taking in new people are passed. We are all driving now for new scientific industries, which means new scientists, technologists and technicians. We have made arrangements for that to be done, and we hope that in the future we shall show an increasing output, but Scotland ought to have skilled people for the new age which we are entering. I refer to apprentices. I am informed that the reason we are not training apprentices is connected with trade union restrictions. [HON. MEMBERS: "No."] I may be wrong but undoubtedly in Scotland today it is easier to become a scientist than to become a skilled workman.

Mr. Bence

May I interrupt the hon. Gentleman?

Mr. George

No, because I have to catch a plane. [HON. MEMBERS: "Oh."] I was saying that it is easier to become a scientist, when it is a hundred to one chance of getting through, than it is to become a skilled workman, because there are great restrictions upon the number of apprentices that can be employed in particular trades. That position should be studied. I am informed that even if industries were training the number of apprentices they need for themselves, we should still be without enough skilled people. I hope the Government will study a scheme whereby a grant can be made to train apprentices.

Mr. Lawson

On a point of order. Do I understand that the hon. Gentleman was saying that he could not give way because he has to catch a plane? Are we to understand that he has come here to make a speech, and then dash off after making it, without listening to anything which anyone else has to say?

Mr. Speaker

The hon. Member who had the Floor of the House did not give way. Although several hon. Members tried to interrupt, it is out of order to try to do so if the hon. Member does not give way. What he says can be answered by way of debate, if there is an answer to it. It is not necessary to intervene on every occasion.

Mr. George

I was appealing to the President of the Board of Trade to study the question of apprenticeship training in Scotland, and if possible to devise a scheme for grants which would induce many firms to try more apprentices than they need themselves nowadays and therefore fill the gap which the hon. Member for Motherwell mentioned.

Mr. Bence

I am much obliged to the hon. Gentleman for giving way. He made an accusation that the trade union movement was refusing to admit apprentices on the floor of factories. Let me assure the hon. Gentleman that, if any industry is prepared to take student apprentices, no trade union will interfere with it having as many as it can get. On the floor of the factory, however, it is impossible to put more than a certain number of craft apprentices in a craft department.

Mr. George

I have made my point, and I hope that the President of the Board of Trade will pay some attention to it.

Quite apart from training more apprentices and more scientists, Scotland needs a new major industry in future, and it has been suggested that there should be a strip mill. I hope there will be a pronouncement soon as to whether there is to be a strip mill, and when and where it will be built. There is a lot of tension building up between Wales and Scotland, which is not good, and I hope that a Government announcement will be made soon. I hope that when it is made, the grounds for the decision can also be given so as to ease everybody's mind. I believe that a strip mill or something like it might indeed form a new base for the future.

It is obvious, however, that a decision must be based on sound economic reasons, containing perhaps only a portion of the social considerations; I think there should be only a marginal social content in the decision. For my own peace of mind and that of Scotland, I should like to see that case explained to us after the decision has been taken. I should like to ask the Secretary of State one further question. Has the Scottish case been put forward by unbiased steel experts? I have seen the Scottish Council case, but the people who put up that case are not experts. I believe that the case presented by them will be treated at top level more or less as an amateur case, whereas it is a matter for experts and skilled people to get the final decision taken.

We have seen various measures taken recently, and I believe that there will be more and that something will be done in the way of reduced taxation and other measures to excite the economy and to help to counteract the world depression. I believe that the only real cure is a world trade revival, and that is not a matter for this country alone. Our people here, both men and management, should be striving for lower costs, higher efficiency, and above all in Scotland, for better labour relations in future.

7.45 p.m.

Mr. Malcolm MacMillan (Western Isles)

I will try to be brief, if only to make a change from my usual habit, but I really would have to apologise to my constituents if I did not lake part, in present circumstances, in a debate in this House on employment.

When people talk about figures of unemployment of 3 to 4 per cent. for Scotland, or even of 7 or 8 per cent. for some areas in Scotland, I must say that that sort of figure means almost nothing to my constituents. Today, we are up in the region of 30 to 40 per cent. unemployment in the Western Isles; but percentage rates do not always convey the situation in human terms, or even in economic terms either. The 33 to 37 per cent. which we have had in these last few months in Lewis does not indicate the whole of the unemployment, and though about 2,300 people may now be officially classed as unemployed, one has to add several hundreds more, not classified as employed persons. That could in a bad period bring the figure nearly to the prewar 3,000 level.

The hon. Member for Pollok (Mr George) has made several extraordinary comments, some of which he rather contradicted in detail as he went on. He welcomed, on the basis of the Liberal Party newspaper and the Gallup Poll, the indications that the Tories will win the next Election. We are quite willing to follow him to a General Election; but that is the one thing that we cannot gel him to agree to. If the hon. Gentleman is really thinking that way, we are all for it. Let us have an Election; it will be an excellent thing.

Going on with his several extraordinary comments, the hon. Gentleman said that people in industry like the economic squeeze and the credit squeeze. It is a curious thing to like. It reminds me of the quite untrue story of the English girl in the W.A.A.F. who said that she had been treated a bit roughly by an amorous Hebridean sailor. When she was asked why she did not ask him to stop, she said that she could not, because she knew no Gaelic. Possibly, that is the difficulty in which our industrialists are when facing the Government's credit squeeze. They cannot make themselves sufficiently clear and articulate in putting the case to the Government to get rid of it. However, if the hon. Gentleman likes to be squeezed, let him have it. I am sure that most persons in Scotland who want to expand their businesses and wish to obtain finance would not agree with him very enthusiastically on that point.

Having generally been optimistic about the Scottish industrial situation, the hon. Gentleman went on to condemn it, point by point. He painted a rather bleak picture about shipbuilding, one of the major industries in Scotland on which we have been only too dependent in the past, and in which there has been the heaviest unemployment from time to time in Scotland's history. He went on to talk of the lack of development of Scottish light industries, to criticise the facilities for helping new industries from elsewhere, and complained, finally, of the lack of opportunities for apprentices, and of the consequent shortage of skilled men. If this is his Election address, the sooner we can go to the country and accept the Gallup Poll the better for the Labour Party. The hon. Gentleman did not leave very much to praise in his consideration of Tory Government policy over the past few years.

I want to turn now to an aspect of the subject that was introduced by the hon. Member for Fife, East (Sir J. Henderson-Stewart). I am sorry that he is not here at the moment, because he introduced some very important points, and I am sure that hon. Members for industrial areas will sympathise with what he said. I do not think that we should take a narrow view about the non-industrial areas' problems, because there is a human problem wherever men are unemployed, where industries are sinking into decay, and wherever human beings have to leave their homes and go abroad to find employment.

During past years many hon. Gentlemen have always taken a very strong interest in the position and difficulties of areas like the Western Isles and the Highland area. We well know the difficulty which was mentioned by the hon. Baronet of getting adequate publicity for rural problems, and, particularly, of getting things done by Government action, which is bound to be more difficult in the outlying areas.

When we have heavy unemployment in places like Greenock, we can get a national Press campaign for it and a considerable amount of support from powerful local authorities and others. We can get the Council for Industry interested in it; but when it is a place like the hon. Gentleman's constituency of East Fife or like the Western Isles it is not such an easy thing to get the Board of Trade to send somebody to investigate or to get the Secretary of State to rush up to interview people personally about what can be done. It is not easy to get Ministers to the point of practical action, still less to get the Treasury interested sufficiently to enable them to take action.

There are possibilities for the Government themselves to take direct action on some of these problems. They can at least help to promote a short-term programme of work and development by providing many basic services which are taken for granted in the industrially developed areas in the South—basic services such as water supplies, roads, bridges and so on, which are essential for communications in the Highlands, and are one of our greatest needs in making the Islands more attractive to industry to go there and for existing industries there to expand.

I shall not take up time going into the various parts of the Highland problem which have been so often aired, and rightly aired in House and Committee; but, as we have emphasised time after time, the depopulation of the Highlands is going on. In the last five or six years it has been accelerated to a pace probably not previously known in this quarter century. What has happened in a short period of five or six years is that we lost over 8,000 people between 1951 and last year. That is all part of the result of Tory prosperity, on which hon. Members such as the hon. Member for Pollok are to base their Election addresses. There is not a very good reflection of so-called prosperity under the Tories in that part of the country.

I quoted a figure elsewhere recently of the decline in the manpower of the very important industries in this area, the local crofter fishing industry in which the number of crating fishermen has gone down from over 4,000 to 1,400 in twenty years. A repetition of that kind of thing in this occupation in the Hebrides and all around the coasts of Scotland would mean that soon there would be no crofter fishermen in those districts. While there is a certain growth in some of the towns, we have the dying away of small West Highland communities, of small peninsula villages, in the smaller islands and areas around the Northern coasts. In the meantime, in the one urban area in the Western Islands where there is industrialisation, in textile manufacturing in Lewis, there is the heaviest unemployment of any part of Britain.

I sympathise with hon. Members from the industrial areas, who may feel impatient about outlying areas being drawn into a debate on general unemployment, because in the past massive unemployment figures have been mainly confined to places like Port Glasgow or Clydebank, and the cities, where we had the pride of Scottish craftsmanship standing idle for years in pre-war days; but it is just as bitterly humiliating a thing, just as demoralising and disenchanting for men losing their jobs one by one, in the little villages of the Highlands and Islands as to become unemployed and unable to earn and maintain a decent standard of living elsewhere in the land. Recently in the Islands of Lewis and Harris unemployment has amounted to as much as 37 per cent. and that accounts for only about two-thirds of the men and women unable to make a living there. It is a very serious human problem, reflecting a serious history of economic and social neglect for which successive Governments have a considerable responsibility—and there is a responsibility now upon the Government to take some urgent, adequate action.

In this House we have talked for years ad nauseam about Highland depopulation and the drift from the land. On all sides of the House we have talked about it, and hon. Members from Highland constituencies are notoriously at one on many of these questions because the same endless problem affects them similarly when they see intimately in small places and communities what is happening in these little villages—perhaps even more than it affects other Members in city centres and urban areas who often can see only bigger groups of people. The time for action is long past. We find that the only means of sustaining our Highland population is by keeping older people alive longer, while the youner people are still drifting away. The ultimate result of this drift away of youth is the fundamental destruction of the way of life of the whole crofting Highland community.

Reference has been made to apprenticeships. That is a problem which, although it may, at first sight, seem strange, affects us in the Hebrides, when it occurs on the Clyde. Several years ago, we set up a very fine technical college on the Island of Lewis. It partly trains and turns out young boys and girls for further training in various trades and occupations. Some go down to Glasgow, and others elsewhere, to try to get apprenticeships; but they are being turned down frequently and they have been getting very little encouragement. This is not the fault of the local trade unions. They have been most encouraging, but the fact is that there are no openings for these young people in competition, we are told, with too many local applicants. The hon. Member for Pollok, who is now leaving the Chamber in order to catch his 'plane, suggested that refusal of apprentices was the fault of the trade unions, but in the Islands they are co-operating with the technical college and local employers and others in trying to get these boys into apprenticeships and advanced courses.

Unfortunately the many refusals are resulting in a sense of frustration. Having set up this technical college and encouraged young people into it, we find that when they leave they can go no further in the trade in which they have begun to be trained. That is a serious thing in an area where there is so little local chance to learn a trade, and where even education itself creams away the best of our workers to areas of better opportunity and leaves behind youngsters who have not the equipment or opportunities for an academic career. It is a most frustrating and unhappy situation, to have still so many dead-end and blind-alley jobs.

At times I wish I could see the Secretary of State looking a little more unhappy about this question. I have done my best with him recently and I do not know whether there is a possibility of doing any more to waken him up. I have tried in the last few weeks to interest his organisation at the Scottish Office a lot more in our Island plight. His Department and Ministerial team is as numerous as any Minister's. The right hon. Gentleman has no fewer than five or six assistants in this House and in another place. The Department has been called a giant with feet of clay. I would call it a five-headed dwarf with feet of Maclay. It is the most feeble of all Departments on the economic side of our Scottish problems.

Since we have him with us, I want the President of the Board of Trade to consider this problem as a high personal responsibility in which he should take some direct action in the early future. Can we have an assurance that he is going to interest himself intimately for the next few weeks and months in the problems of those Island areas, which have the highest unemployment of all? I know how difficult it is to draw industries to places like the Western Isles; but he can at least start to encourage industries which exist there already.

Instead of that, he made what we felt was a most unfortunate faux pus recently. I do not think it was premeditated—it may have been made in lighthearted ignorance—when he said that Harris tweed which is recognised even by the American Government as a distinctive cloth is something which could be manufactured anywhere at all, "like a bath bun." That showed a depth of irresponsibility or ignorance which not even his predecessors at the Board of Trade or at the Scottish Office have shown hitherto. If he did that sort of thing to enough industries, which can base a claim to public appeal upon the distinctive characteristics of their product, he would destroy enough industries to put himself out of office—with possibly a hope of more success at the Ministry of Transport.

Another thing which perhaps the President of the Board of Trade might encourage the Minister of Labour and the Minister of Pensions and National Insurance to look at is the question of the insurance position in the existing industries in the area. Our main employing industry, apart from agriculture and fishing, is Harris tweed weaving, but when there is a slump, as there has recently been, the men engaged in that work are not even able to claim insurance benefits, because they are not working under a factory roof or under a contract of service to one employer, although they work under the same conditions as men weaving cloth elsewhere. Because they are slightly off the normal industrial beat from the usual relationship between employer and worker, at the moment they most need help they are cut off from unemployment insurance and even from National Assistance.

The President of the Board of Trade could address himself, with his colleagues, to some of these problems. He has done a great deal in the last few months to try to promote the expansion of trade between the Western nations. I ask him also to have a look at the same time at the importance of trying to ease a little East-West trade as it affects people in the Hebrides.

It was because of the lack of diplomatic relations with the Soviet Union in the later nineteen-twenties that the cured herring industry fell on evil days, from which it has never recovered. It has never recovered the Russian market as it existed in the old days. For the same reason, because of the lack of recognition—de facto recognition or even mere official trading recognition—of East Germany, where they want our Scottish herring, we are suffering the loss of a valuable market which might well be ours. I know this on the direct personal assurance of their own President of the Chamber of Trade. These are things which the President of the Board of Trade ought to look into, and I hope that he will do so.

May I now thank the right hon. Gentleman and his colleagues for having successfully approached, and very persistently pressed, the American Government about the Harris tweed industry for a relaxation of the quota limits which had been placed on imports of Harris tweed? That was extremely helpful, and I should be less than gracious if I did not thank him for the action which he took on this issue.

Those are among the many important items affecting employment and industry in the Western Isles. The final comment I wish to make is on something which I believe every Highland Member has always campaigned, the question of exorbitant freight charges. We subsidise the MacBrayne Company alone to the tune of over £1 million every three years. That is a fair sum of money; and it means that over every ten years of a full contract we are handing out over a big part of £3 million. Since it is quite a lot of money, we ought to expect full value for it and, with value, we ought to expect justice.

Yet railway and MacBrayne freight charges are a fearful burden upon every living person in the Islands having to use a MacBrayne steamer. And while a live passenger travelling from Glasgow to Stornoway can be carried for £2 10s. or so going via Inverness, if he has the misfortune and the humiliation to die in Glasgow and his body is taken to Stornoway, it costs twenty-six times as much when he is dead as it would have cost for him to carried alive, £53 10s. I do not exempt British Railways from this, because I have approached them and they have turned my request for reductions down. MacBrayne's and British Railways exploit the dead as well as the living and they exploit the bereaved as well as the healthy.

It is high time that the whole relationship between the Government and the company was investigated once again, because these charges upon everything from food to furniture and upon all persons from the living to the dead are exorbitant and are a further burden on an area of small communities in which the cost of living, even normally and apart from freight charges, is well over 10 per cent. higher than in such places as Inverness and Glasgow.

8.3 p.m.

Commander C. E. M. Donaldson (Roxburgh, Selkirk and Peebles)

I suppose that, geographically, the hon. Member for Western Isles (Mr. Malcolm MacMillan) and I could not be further apart, and sometimes that also applies to our political thinking, but there are things which unite us, and that which unites us most is a common interest in the wool trade of Scotland, although his interest is in Harris tweed and mine is more in the high-grade quality tweed as made in the three Border counties which I have the honour to represent.

I also believe that we are apart in relation to unemployment. I have before me a document produced by the Scottish Council and published in this month's magazine "Scotland", in which it says that the average unemployment for Scotland in April, 1958, was 3.6 per cent. but that it varied greatly from place to place, the extremes being Hawick, which is in my constituency and is my largest burgh, with 1.3 per cent. unemployment, and Stornoway, with 34.2 per cent. unemployment.

I am not standing here to make those comparisons particularly, but to make some comments about the wool trade in Scotland as it affects my constituency. I am glad that the Board of Trade have obtained some relief by the reduction of the tariff on the tweed as made with the orb trade mark, made in the Western Isles. I hope that the President of the Board of Trade has made as firm and hard representations in relation to piece cloth made in the Border and other parts of Britain as he made in relation to Harris tweed designated as Harris tweed marked with the orb trade mark.

The hon. Member for the Western Isles and I differ as to definition and as to the construction of the definition but, be that as it may, no one in Scotland wishes ill will to anyone else when it comes to trade and the employment of people, whether in the Western Isles or in the south-east of Scotland.

May I draw my right hon. Friend's attention to the fact that the Canadian Tariffs Board has recommended that higher duties should be imposed on wool cloth imported from Britain and that the Canadian wool industry has called on the Canadian Government to promote action to implement the recommendations. These decisions have an effect on the wool trade of Britain and of my constituency in particular.

A statement was made by the National Association of Scottish Woollen Manufacturers, the chairman of which this year is one of my constituents. This statement levelled heavy criticism against the recommendations because exports of Scottish woollen cloth to Canada during the first four months of this year were about half what they were in the same period in 1957.

I have in my hand Cmnd. 127 of the Scottish Home Department, Industry and Employment in Scotland and Scottish Roads Report. 1956. This is a document which we debated in Committee earlier this week, and I therefore assume that it is the latest document of its kind available to us. In any case, it is the document which I found when I asked for a copy.

According to this Report, the exports of cloth from my constituency in the Borders in the year 1955 amounted to £12.5 million, and these were shipped chiefly to the dollar market. In the Borders, we have had the impact of the American woollen tariff and we have also the fear and the potential effect of the Canadian tariff as about to be imposed, which will further adversely affect our trade.

Other hon. Members have suggested this afternoon subjects which the President of the Board of Trade might think it well to introduce at the meeting in Montreal later this year. I do not wish to exact a promise from him, but I wish to put it in his mind that Mr. Diefenbaker, in speaking to a joint meeting of all parties of both this House and another place, expressed his desire and the desire of the Canadian Government to increase the trade between Canada and Britain by 15 per cent.; and that it comes peculiarly odd, his having said that, to find that the pressure of his own manufacturers at home immediately brings about a situation in which a higher tariff is imposed against the products which we make.

I hope that that is one of the subjects which might be considered, speaking broadly and in the context of the Empire and the Commonwealth, because the Canadian and the American tariffs affect not only this country and the Commonwealth but other countries throughout the world, and a broad discussion might lead to a consideration of the subject.

I turn, next, to employment in the wool trade. By and large, we have been reasonably fortunate in the Borders, although there has been short-time working in the past year or so and there still exists a modicum of employment. By that I mean that when we ask for statistics from (the employment exchanges we are given a figure—and it is a small figure of 170 unemployed for the three counties—which does not indicate those who are not fully employed. There are mills, particularly in the tweed section and spinning section of the industry, which have a considerable amount of under-full employment. The Report to which I have referred states that in Hawick, the biggest burgh in my area, which has 1.3 per cent. unemployment, the figure is well below what is considered to be full employment.

I wish to repeat what I said in a similar debate some years ago in the House. That position may be satisfactory from a national point of view, it may be satisfactory statistically, but the mill worker, or his wife, or his son or daughter who is not at work, is not 1.3 per cent. unemployed but 100 per cent. unemployed. We in this House all seek for real, full employment for all the people in Scotland, whether they be in the Borders, the Highlands, the West or the North-East.

I would be ungracious if I did not prefer to the excellent speech made by the hon. Member for Leith (Mr. Hoy). We know him best as a Chairman of Standing Committees, and we respect his ability in the Chair. This afternoon, we heard him make a first-class speech—from the Opposition point of view, of course—attacking the Government. It was a good speech, and he has done himself and his constituency some honour in so well acquitting himself.

I should like to refer to that part of the hon. Gentleman's speech in which he spoke of people leaving Scotland. It is nearly always said that the only reason for people leaving Scotland is that they cannot find employment there, and go elsewhere in search of it. I assure the House that that is not always so. My right hon. Friend the President of the Board of Trade referred to people whom he had met in British Columbia and in other parts of Canada. I happen to know them.

I went there at the age of six, with my father. I lived there for about forty years before the war broke out. My father did not go there because he was unemployed, but because he looked for new fields to work in, new seas to sail in, and new mountains to admire. That is why I was happy to be brought up there, but more happy to return to Scotland, with a Canadian accent, a good Scots name and good Scots blood, to have the honour to represent the Border Counties in this House.

That experience makes me think that Scotsmen go to the far countries of the world not only to find employment, but with some sense of mission. My right hon. Friend said that the good government of British Columbia, and the good government of Canada implied by it, has resulted from the emigration of Scots folk who, wherever they have gone, have maintained the dignity of their country and the honour of their race. It is not necessarily a reflection on Scotland that people go from it even in times of full employment. A few years ago, we had more than full employment in my constituency. We had more than 1,100 jobs vacant and no one to fill them. Even then, people with adventurous hearts went across the seas to see some other parts of the world. It is traditional and good.

I hope that we shall not forget, that the President of the Board of Trade will not forget and that the Secretary of State will never fail to remember that we in the Border Counties are situated as Dundee has been situated recently. We are closely associated with the wool trade and the wool industry. We have had sad experiences here and there. We have had sad experience in my royal and ancient burgh of Jedburgh, where there has been a serious pocket of unemployment. Happily, we believe that that is now being overcome.

My hon. Friend the Member for Fife, East (Sir J. Henderson-Stewart)—who, unfortunately, is not present—referred to what he thought was a complete lack of co-ordination between Government Departments when pockets of unemployment develop in what are otherwise large rural areas, such as his and mine. When Jedburgh was in its extreme difficulty there were meetings between the provost and his council, the Members of Parliament concerned, representatives of the the Board of Trade, of the Scottish Council (Industry and Development), of the Scottish Home Department, and of the Scottish trade unions, all meeting under the ægis of the provost.

To those who have similar difficulties I commend that sort of co-operation. If they seek it, I feel quite sure that they will receive it.

8.15 p.m.

Mr. Cyril Bence (Dunbartonshire, East)

I am sure that everyone agrees with the hon. and gallant Member for Roxburgh, Selkirk and Peebles (Commander Donaldson) that it is a good thing for British people to leave this country and take their ideas into other parts of the world. I have never heard anyone really criticise emigration from the Highlands, but rather the background and the motive that leads the people to leave.

Many people have emigrated in the past, and many continue to emigrate, in an adventuresome spirit, but what is worrying many people in Great Britain, and particularly in Scotland—and especially those of us in the craftsmanship and technical side of the engineering industry—is that people are emigrating, not merely because they have an adventurous spirit and want to start a new life, to open up new territories and to find adventure in all the wonderful ways of which we read in the eighteenth, nineteenth and early twentieth centuries, but merely to employ their skills and techniques in much the same way as they would employ them in their home country.

They go because they cannot find scope in this country for those techniques. Very often, it is not the unemployed man who is emigrating but the highly-skilled technical man who, by his emigration, is creating a situation at home whereby we get increased employment of unskilled labour because of a lack of the necessary skilled men.

As most Members know, I was a student apprentice, toolmaker and production engineer. Not far from where I live there is a factory which could employ far more men if it had a couple of toolmakers and a production engineer. The firm cannot get them. Why? I think I have the answer. I left my job in the motor industry in the Midlands to go to Scotland. I had never before been to Scotland but I thought that I had better go there in good time, because if I went just before a General Election I knew I would have rather a rough time of it. When I started at Blackburn's factory in Dumbarton, I was offered slightly less than half the wages I had been getting in the Midlands for the same job.

As long as that persists, the skilled men will leave Scotland—and I do not blame them. Is there any hon. Member who would work in Glasgow for half the wages he could get in London or Birmingham, always supposing that accommodation were available? No one can be attracted to an area if the profits from his activities there are not as great as they would be in some other area. The average man goes to work for wages, not because he enjoys it. The average group of men forms itself into a company to make profits out of a job. It those men cannot make profits out of that job, they drop it and seek something else.

This afternoon, and in the Scottish Grand Committee this morning, mention has been made of American companies. There seems to be an awful lot of satisfaction over the fact that each year so many American companies are coming into Scotland. I have no objection to that. Of course, I welcome them. Their organisational methods, their techniques and their attitude are very often far superior to those of some of our old-fashioned engineers and engineering organisers. I have worked under American engineers and production engineers and, believe me, when they talk of production, they know what they are talking about. They get on with the job.

Yet, with all the latent talent we know there is in Scotland, between 1945 and 1955—which was a period of expansion—many people left that country, and we have that frightful position that there is no institution there that has sufficient faith to finance and organise the craftmanship and industrial enterprise of Scotland. We have to wait or go cap in hand to the Americans or to companies in the South and ask them to put up subsidiary factories, although these will be closed down at the first opportunity.

I want now to turn to a subject which I recently saw being discussed between two hon. Members of the House, a Labour Member and a Conservative Member, on television, the question of industrial development certificates and factory building. The President of the Board of Trade says that his Department does not issue certificates for factory buildings in the London and Midlands areas. I accept that, but I know of factories in the Midlands and in the London area—I could name some—which have been rebuilt, although they should have been condemned years ago, slum factories which any Government thinking of evening out the population a little would have certified as unfit for the employment of human beings. The Government ought not to have allowed any development of them at all but should have had factories built in the new towns or other areas to which industry could move. During the course of the last seven years, those factory premises have been rebuilt, a bit at a time, one wing rebuilt here, another wing rebuilt there, until, finally, instead of there being what was a factory of two storeys, there is, suddenly, a five-storey factory.

I know of one company in particular which has done this. This company has trebled the output capacity of the factory in conglomerations of factory space, all on the same floor area, in what is in fact a new factory building. In many cases where this has been done, those concerned are sorry they did it. Others have done it all around them, and, although they have increased their output from the factory, traffic congestion has become so bad that they wish now that they had taken the advice of the Board of Trade and gone into the country to build a factory there, where their raw materials and finished products could readily have been delivered and taken away. One company I am thinking of is now considering building another factory on the Continent.

There are many other aspects to the issue of industrial certificates and the building of factories which I could discuss, but I promise to be brief. I wish now to turn to the problem in the burgh of Kilsyth, which is in West Stirling, not actually in my constituency, but linked with the villages of Twechar, Croy and Waterside. Coal mining in the area is slowing down. The Gartshore pit is gradually reducing the number of its workers. In a short time, the pit will be closed. As I understand it, only a few of the displaced miners and workers from the pits will find employment elsewhere in the area. There is another coal mine which, I understand, has only some four or five years' life ahead, and that life is entirely dependent upon the demand for coal remaining as it is, and making it worth while for the Coal Board to extract the coal which is, at the moment, high cost coal.

The miners in this triangular area of East Dunbartonshire and West Stirling are likely to experience unemployment. We have a little of it already, and there is likely to be more. There is no alternative industry in the area. I hope the Joint Under-Secretary of State will not tell us that the new town of Cumbernauld will bring in new industry, because only one industry has gone there yet and that will employ the overspill from Glasgow. The new town is not the answer.

New industry must be attracted into the area. How it is to be done, I do not know. I cannot see how it is practicable for Governments to attract people in that way unless they offer subsidies or assure them that conditions will be created wherein goods can be produced more cheaply than they can somewhere else. How else it can be done, I do not know. This idea of attracting industry has always been something of a mystery to me, unless the idea is to give the industrialists and organisers in industry some financial advantage for going.

My information is that it has been planned to sink a new pit at Bearsden. I understand that the National Coal Board in Scotland has been ready for some time to go ahead with the sinking of this new pit. The work might have been started some time ago and some of the men now being displaced from Gartshore might have been employed in the work of sinking it had it not been for the Secretary of State for Scotland holding it up. I can hardly believe that the right hon. Gentleman has been responsible because I did not think he was strong enough to hold up the Coal Board, but the information may be true. I did not like to write a letter to the Secretary of State making this statement after the debate on Tuesday, but if the Joint Under-Secretary of State would give me an assurance that he is prepared to receive a letter pointing out that this suggestion, which may be quite untrue, has been made, I will write to him.

Mr. Willis

Would it be a proceeding in Parliament?

Mr. Bence

If I have that assurance. I will send it.

I hope the hon. Gentleman will carefully examine conditions in what I call this triangle around Kilsyth. It is amazing that we should go to a great deal of trouble to build a new town seven miles away from a place where, as a result of Government policy—I am not making a political point—we are leaving another town to decay. Here are two towns, one being allowed to decay and the other, a new one, now being built. It seems frightful. I hope that the Secretary of State will use what influence and power he has to have a decision about the Bearsden pit arrived at quickly and do what he can to attract new industry to this triangle in order to save its little villages which, at the moment, are quite prosperous places but which are in danger of becoming no more than a backwater.

I know that other hon. Members wish to speak, and I will do my best to finish by twenty-five minutes to nine; but I want to say a word now about the shipping industry. I am much in favour of attracting new industry to Scotland, and I very much want a strip mill in Scotland. As a production engineer, I know very well that, in this modern age, there is a vast range of products made out of strip steel. Without strip steel, there is no hope of progress in light engineering. Strip steel has taken the place of cast iron and even of aluminium die-castings in many branches of engineering. Therefore, I ask the Government to make a quick decision to lay down a strip mill in Scotland. At the same time, however, we must not forget the great basic industries, of which shipbuilding is one.

The shipbuilding industry is of great importance to my constituency and to the Clyde basin in general. It is of importance also, of course, to the Scottish steel industry. After all is said and done, if it were not for the shipping industry. Colville's shares might be worth 2½d. apiece. Although some of that company's steel goes into general engineering, the bulk of it goes to shipbuilding.

The shipbuilding industry is very prosperous at the moment. But unfortunately factors are creeping in which may have a serious effect on the industry in the next five years. Although we are members of the United Nations and members of the association of the free nations of the world who believe in playing the game, what the American Government are doing in their internal shipbuilding and commercial policy, whether they realise it or not, is contributing towards completely smashing the British Mercantile Marine and the British shipbuilding industry Will not anyone realise what is happening in the United States? Four passenger liners, two for the North Atlantic and two for the Pacific, costing £27¾ million apiece, are being laid down and financed by the American Government. These liners are being, transferred to American companies, at a cost of £16½ million spread over a period of their life, which then put them under flags of convenience. How can the British Mercantile Marine stand up to that?

Again, the American Government are to finance the rebuilding of every American merchantman which is over 15 years old. These ships will carry a subsidy of 30 per cent. America is the land of free enterprise. We have a Government here which steadfastly refuses to face the position and either do a similar thing for the British shipbuilding industry or at least get the Americans to recognise the unfair challenge to the British Mercantile Marine. As a trading nation, we cannot afford to see the British Mercantile Marine deteriorate. It is one of our big earners of foreign exchange. The shipbuilding industry is absolutely vital to Scotland. If it goes down the repercussions will be terrific. The whole of the steel industry, which is concerned with the making of instruments for ships, and the furnishing trades will be affected.

This is a serious matter, and I should have thought that the British Government, in view of our great traditions of the sea—and remembering that British mercantile supremacy from the 17th century has been built up with ships built in yards belonging to the Government—would have done something about it. The British Mercantile Marine was built up by Governments before the 19th century, and the ships were hired out to Hawkins and other men who went round the world plundering the Spanish and Portuguese.

Commander Donaldson

And no flags of convenience.

Mr. Bence

Yes. In those days the flag of convenience was either the Union Jack or the skull and crossbones. The skull and crossbones was the best one. With that flag, ships got into all sorts of places. Viscount Tredegar, who was formerly Henry Morgan, sailed the Spanish Main with a skull and crossbones and came back and got a peerage for doing such grand pirating work against the Spaniards. He became Viscount Tredegar. He was knighted the first Sir Henry Morgan.

Mr. Ross

Was he a Member of the Scottish Grand Committee?

Mr. Bence

He would have been had he been here. We are now being a little facetious. A sense of humour is all right, but this is a serious matter for the British shipbuilding industry. It appears that by international agreement we shall not get the Americans to drop their sponsoring of ships under flags of convenience. It is not merely a matter of being negative. The Americans are actually sponsoring ships under flags of convenience. They are subsidising American shipbuilding so that American merchant marine lines can sail their ships across the seas in competition with British ships.

Coupled with the American navigation act, whereby cargoes have to be carried in American ships, we are indeed faced in Scotland, in particular, as a great shipbuilding country, with tragically unfair competition from the United States of America. I feel almost certain that the Russians would not go so far in the subsidising and patronage of a particular industry as the Americans have done in order to try, as I believe, to weaken sterling on the international market.

It is now two minutes to 8.35, and I promised to sit down at 8.35. I should like to make one final plea to the Secretary of State. We seem to have citizens on a first-class standard of living south of Gloucester, a second-class standard between Gloucester and Carlisle, a third-class standard between Carlisle and Fort William, and a fourth-class standard between Fort William and Stornoway. That seems to be how our nation is divided up. It is simply not good enough.

The drift towards the South is taking place all the time. It is no good railing or complaining about it. Obviously, any man with any initiative will go towards where the best conditions can be found. Hence this continual flow down here. I do not care what Government are in power. If they are concerned with the good government of all the people, wherever they may be, they must take positive action. There must be executive action to direct and to move industry and productive processes into those areas not only where people are, but where it is desirable that people should be. We want to move the population and spread it out a bit. It will never be done by going cap in hand to the Bronx or to boards of directors. A Government Department must be set up or established and Governments must take positive, direct action in establishing industries in the further parts of our country and relieve the pressure on this southern area down here.

8.36 p.m.

Mr. Michael Clark Hutchison (Edinburgh, South)

I hope that the hon. Member for Dunbartonshire, East (Mr. Bence) will forgive me if I do not follow him in talking about the shipping industry, because I want to raise two rather different points.

The first concerns the wage structure in industry. Before I came to this House, I was connected with the engineering industry in Glasgow for a short while and I had a good look at the system of wages and the structure generally. What amazed me was that when any new men came into a company, their first question was, "How much Sunday work and how much overtime is there?" It may be that these men were interested in raising their standards or perhaps they had no outside interests, or it may be that the basic wages were not high enough—I do not know. I suspect that it was a mixture of all three. It seems to me, merely as a layman, that there is something faulty with our wage system. It also seems to me that as a great Christian nation, many of our factory laws and arrangements are not quite in accordance with the principles of our religion.

I should like to know from my right hon. Friend the Secretary of State whether there is any body in Scotland composed of employers and the Government, and, perhaps, representatives of the unions, which is examining our wage system, not only for today, but for twenty-five years ahead, because a very efficient system in which everybody was contented would obviously make for efficiency in industry.

My second point concerns the rights and duties of employers and of unions. It is my view that the trade unions have an honourable history. There is no shadow of doubt that they have done a great deal to raise the standard of the working people in Scotland and have brought happiness to many homes. Recently, however, there have been some rather disturbing elements which I do not like and which I do not believe the public likes.

We remember the leader of the bummarees, in Smithfield, who rather put himself above the law. Then there was the case of the polisher in the Rolls-Royce factory at East Kilbride, and there was the even worse case of the members of the Electrical Trades Union who appeared masked on television. That, to me, was quite appalling.

Most of these are cases from outside Scotland. In my view, labour relations in Scotland and the trade union organisation are superior to those in England. Nevertheless, there are certain attitudes taken up which are really as dead as the dodo. It seems to me that in industry we have a division of a horizontal character, with employers and labour pulling against each other. That must weaken the efficiency of industry generally.

I should be very glad to hear what hon. Members opposite have to say on the subject, because I am a seeker after knowledge here. I wonder whether the solution would not be to get back to the guild system, or some sort of extension of it, so that everybody in industry, from the general manager to the newest apprentice, would pull together and belong to a single industry. Thus, if there were to be divisions they would be vertical or perpendicular divisions.

This may not be the solution to the problem, but I am concerned that our labour relations should be the best possible. We in Scotland are a small nation. We are closely knit and I believe that we have skill and intelligence. Surely there is scope here for experiment. I should like to hear from my right hon. Friend and hon. Members opposite what they think of this idea. I should like to know whether there is any body which is studying these matters with a view to introducing a new philosophy and long-term development. I am thinking not of 1958, but of fifty years ahead. I should be glad to know what my right hon. Friend has to say on these matters.

8.43 p.m.

Dr. J. Dickson Mabon (Greenock)

The hon. Member for Edinburgh, South (Mr. M. Clark Hutchison) has asked a very formidable question of his right hon. Friend and hon. Members on this side and I do not propose to follow his invitation to go into the matter fully. When the profit motive takes second place to the activities within a factory, everybody will pull together much better than has been the case over the past many years.

The best lecture that I ever heard on this matter was delivered at the Co-operative Co-partnership Federation by my hon. Friend the Member for Hillsborough (Mr. Darling). I recommend the hon. Member for Edinburgh, South to read that lecture if he wants to know more about the attitude of many Labour and Co-operative Members to co-partnership and, I presume, to co-ownership in industry. I apologise for not dealing with the subject, but I am restricted by time, and the President of the Board of Trade was good enough to make an important announcement this afternoon affecting my constituency.

Three events in the debate affected me considerably. The first was the political somersault performed by the hon. Member for Pollok (Mr. George), which I welcome. He has changed in one year from being against the demand for a steel mill to being in favour of it. This change of mind has at last given us the unanimity which the Welsh have managed to maintain for years. Having the hon. Member back in the fold delights me very much, and I hope that all Scottish Members will concentrate their efforts on bombarding the Government with the demand that we have the fourth strip-steel mill in Scotland.

The Liberal Unionists were also having a field day today. I was delighted to hear the statement by the hon. Baronet the Member for Fife, Fast (Sir J. Henderson-Stewart), who came out in favour of an economic general staff and thereby proposed a motion of no confidence in the Secretary of State. Thirdly, I was pleased to hear the hon. Member for South Angus (Sir J. Duncan) argue in favour of planning. The only thing about it was that the hon. Gentleman emphasised in precisely the same terms as my hon. Friend the Member for Dundee, East (Mr. G. M. Thomson) the demands of Dundee and the jute industry: that the Government must not tamper with the position of jute in Dundee until new jobs have been created to absorb the unemployment already created. In other words, there has to be a large programme to deal with unemployment.

The hon. Gentleman can hardly deny to any other part of the country, Greenock or anywhere else, what he asks for Dundee. I make no apologies for talking about my own constituency. I have attracted a certain amount of dubious envy. I would prefer to be like the hon. and gallant Gentleman the Member for Roxburgh, Selkirk and Peebles (Commander Donaldson) and boast of the lowest unemployment figures, even with the under-employment, than to state what has been the case for over a year in my constituency, that it has had the highest incidence of unemployment in the Scottish industrial areas. Remember that for twelve months we have had 8 per cent. of our insured population unemployed. I do not deny that Motherwell, Coatbridge and Dundee are catching up to the same level as Greenock, but it does not affect the fact that we have had this problem for a year, and in that year precious little has been done.

Hon. Members may argue, as the Secretary of State is right in arguing, that a lot is to be done. The Secretary of State has managed to get an extension to I.B.M., but we have been told tonight of the cut, which will mean a reduction of from 500 to 300 jobs. By October, 1959, we shall lose the torpedo factory, and this means that 500 people will be rendered unemployed, even if the expectation of transfer to England materialises, and even that is in doubt at present. In other words, it is like filling a bath with the plug out and making an additional hole in the bath at the same time. It is an impossible situation and the Government must do a great deal more than they are presently doing to attract industry to Greenock and other similar places.

The Secretary of State knows that in October, 1959, he will have a huge advance factory lying vacant when the torpedo factory goes south. Have we to wail until then to get industry into Greenock? Are we to be satisfied with the extension that will be constructed in 1960? Even if the graving dock materialises, which is another part-solution, it will not actively affect the situation until 1963.

I suggest to the Secretary of State that in view of the announcement of this cut it might be an idea if, converted by his Liberal Union colleagues, he would phase the problem of unemployment and make representations to the Admiralty to delay the transfer of the T.E.E. for three, six or twelve months. That is not unreasonable. After all, the Admiralty will not completely crack up, the fleet will not suddenly become unserviced if the transfer of the torpedo factory is postponed for such a time, but it would make an appreciable difference in terms of unemployment in the area.

I also ask the right hon. Gentleman to face the argument of advance factories. I have been on quite a number of deputations and the right hon. Gentleman has been as courteous and as sympathetic as he can. We have heard the argument often. The argument of the Government is, "Well, the onrush of demand by private industry for factories is not the same as between 1945 and 1951. It is all changed now. There are very few customers for these standard factories, and it is far better to wait until someone comes along definitely to take over the tailor made factory."

I do not deny that that argument has a great deal of force. It is an argument to which one should adhere if one wants to save money and not speculate riskily. However, I put it to the Secretary of State, as an example, that Greenock has already had an inquiry from a firm which would snap up a factory tomorrow if one were there. We know of similar offers made in other parts of Scotland by firms, but because the factories have not been available we have been unable to secure them for Scotland.

When does an extension become a new factory? We heard the President of the Board of Trade say that when a unit clearly functions on its own it is a new factory and will be refused a development certificate in the London area, but if it connected with a major process in the industry it is only an extension. I question whether the exercise of discrimination is being carried out as fully and as frankly as we are led to believe. I cannot understand why more of the development taking place in London could not take place in Scotland or elsewhere.

The hon. Member for Pollok is connected with a very good firm in my constituency. It is a progressive firm and has a good labour record. It would never have come to Greenock if it had not been compelled to do so by the Labour Government, by the negative restriction of the refusal of a certificate, and also by building controls. It would have preferred to stay in Shrewsbury and extend there. Now it has no economic argument against being in Greenock.

I would emphasise to the right hon. Gentleman that only when we put pressure on firms shall we entice them to come to Scotland. No firm which has ever come to Scotland, no matter what the compulsion or with what reluctance it did so, has ever been sorry once it has settled down. All such firms are satisfied with the performance of the men and the prospects of their industries.

The Government are being more than doctrinaire in their attitude towards advance factories. Lord Polwarth, who was praised this afternoon, heads the Scottish Council, which is on record as supporting advance factories in present circumstances. When the Government abandoned the plan some years ago, the Council ran a private scheme to finance factories. The scheme did not succeed, but those concerned were so convinced of the principle of advance factories that they were prepared to launch such a plan. The Government ought to think again.

If we in Greenock had three or four small, advance factories which were capable of accommodating firms employing 100 men, we could quickly attract industrialists; then once they were there we might be able to offer them far bigger factories when they had begun to develop and seen the potentialities of the district. We cannot rely on sentiment and the social consciousness of private enterprise to bring industry to Scotland. We require Government persuasion and, indeed, awkwardness with private industry to entice it there. Once the firms go there, I am sure that they will be very glad that they were so enticed.

Although the right hon. Gentleman has much to which to reply, I urge him to say something about Greenock tonight. I particularly ask him to deal with the transfer of the torpedo factory and to postpone it for a short time to give us a breathing space so that our unemployment rate will not rise from 8 per cent. to 10, or even 12 per cent., a figure which is an unreasonable development in the light of the present situation. Indeed, that could materialise before 1960 unless the Government suitably plan their programme.

8.55 p.m.

Mr. Patrick Maitland (Lanark)

I shall not follow the hon. Member for Greenock (Dr. Dickson Mabon), and I shall be as brief as possible because we have only a few minutes left. However, the hon. Member referred to a black spot and I want once again to draw attention to a grey spot in Scotland's unemployment story.

In the Upper Ward of Lanarkshire, the unemployment rate is only between 2 and 3 or 3.5 per cent. as against the 8 per cent. which the hon. Member mentioned and the 10 per cent. further North; and because of that the Board of Trade tends to think that our position is good and it points to the Colville development at Ravenscraig and the vast new Caterpillar production factory. This tends to obscure the fact that every year about 200 voters leave the Upper Ward of Lanarkshire, meaning that every five years about 1,000 families remove from that area. This process has continued not for five but for about ten years.

There is some under-employment in the Douglas mining area, and there are widespread rumours and uncertainty about the future of the Kingshill colliery near Forth. There are uncertainties about the textile factory at Turfholm, Lesmahagow, and men have been laid off at Leadhills, due largely to the depression of base metal prices, by Lowland Lead Mines. Finally, there has been a case in Lanarkshire reminiscent of the Torpedo Establishment at Greenock, even if it is not so grave, in the running down of the R.E.M.E. works, which will involve the displacement of between 150 and 200 men.

This is a familiar story in the Upper Ward, for we have had factories closing down not for only in the past five but in the past ten years—the Cleghorn textile mill, the difficulties with the Kirkfieldbank chenille factory, the Castlehill and Wilsontown collieries, the jam factory at Carluke. Against that, only a couple of factories have come into the area. There is a new shirt factory at Lanark, and a keen and enterprising young man has taken over a large country house called Auchlochan House near Lesmahagow and turned it into a textile factory making excellent sweaters.

The point I want quickly to make in the ear of the Secretary of State is that I believe it is only by the Tory Government's town development programme that we can provide the context for tackling this drift. I believe it sincerely and I believe that the town development provisions of the Town and Country Planning (Scotland) Act will prove in years to come to have been of enormous value for countering this trend.

I therefore beg hon. Members on both sides of the House, and, still more, the local authorities in Lanarkshire, to pay due attention to paragraph 40 of the Report on Industry and Employment in Scotland which we are debating tonight. In order to get it on the record, I want to read this extract: Where the receiving authority intend to provide special social facilities in conjunction with overspill houses, they may, under the Housing and Town Development (Scotland) Act, 1957, make a town development scheme for the provision of industrial, commercial or other accommodation. Approval of a scheme makes Exchequer grants available towards acquiring and preparing land, and towards water supply and sewerage services and the provision of serviced sites for industry. In addition, receiving authorities are empowered to erect factory buildings for disposal either by lease or on mortgage terms; and the Board of Trade will arrange in suitable cases for the specialised knowledge and experience of Scottish Industrial Estates Ltd. to be made available. The Secretary of State is prepared to authorise Glasgow Corporation to spend up to £250,000 a year on purchasing in advance industrial premises which will be affected by approved schemes of redevelopment provided the firms concerned wish to sell their premises and are willing to resettle in the receiving area. I hope that local authorities in Scotland, particularly Lanarkshire, will note that paragraph, because the town development programme is, in local Scottish terms, the key.

We have had before us tonight, implicitly if not explicitly, an interesting Report from the Scottish Council for the Development of Industry. Among other things, that has given two bouquets to the Government and they are worth mentioning. In paragraph 4 in page 5 of that Report, we are reminded that from 1951 to 1956 the number of employed persons in Scotland increased by about 60,000.

Secondly, in paragraph 6 in page 5 the Report says: The situation has been helped by the reduction in the Bank rate and by the selective easing of Bank credit restrictions. It will also be eased by the Bill now before Parliament to extend the Distribution of Industry Act of 1945 to cover financial assistance to sound new developments of all kinds … Those are the words of the Scottish Council for the Development of Industry.

However, I believe that the Council is mistaken on one point, and that is in saying that our future industrial progress in Scotland depends upon oversea markets, which is true, through European markets as the more important, and full of opportunity. The gross national product in these islands is about £17,000 million. Our gross overseas trade is worth about £10,000 million. Our gross overseas trade with the Commonwealth is worth about £7,500 million. In other words, for practical purposes, virtually every other job in these Islands depends upon Commonwealth trade. Here, the Scottish Council was a little bit mistaken in pointing simply to the export market that Scotland should seek in Europe. I prefer the line of its magazine, "Scotland",!which has drawn attention over and over again to the markets which are available to Scotland in the Commonwealth.

The Commonwealth is dotted with men from Scotland, who are advocates of Scottish goods all the time. I should like to see one or other of the great Scottish newspapers the Glasgow Herald or the Scotsman, producing every week an airmail Scottish newspaper which should go to the 10 million, 15 million or 20 million Scotsmen who live elsewhere in the English-speaking world, in the Commonwealth and the United States. It would bring the news of Scotland, and would carry with it advertisements of the Scottish industrial production and Scottish goods.

If Scotland took advantage of the unofficial, unpaid ambassadors she has all over the Commonwealth, and particularly in Canada, and also the United States, she could develop markets far more prosperous and useful than any we can see in Europe. The population of Europe is scarcely rising at all, nor is the standard of living rising very fast, and nothing like, percentagewise, our own in the Commonwealth. Here is the great opportunity. The Scottish Council was wrong in pointing to Europe rather than to the Commonwealth, because in the Commonwealth we have our chance.

There are Scotsmen all over the Commonwealth. We have heard from my hon. and gallant Friend the Member for Roxburgh, Selkirk and Peebles (Commander Donaldson), in a round Canadian accent, a speech advocating Scottish interests. I believe that our interests are involved with those of the Commonwealth. Every other job in these Islands depends upon Commonwealth trade, and so, above all, does Scotland.

9.2 p.m.

Mr. Hector Hughes (Aberdeen, North)

I intended to say much about the fishing industry, but now our old enemy, time, prevents me from using more than two minutes. I shall, therefore, confine my speech to two aspects of the subject.

One aspect is the way in which the Government have chopped and changed their policy for the fishing industry, thus embarrassing that industry very much. I shall refer briefly to grants and subsidies. The Government have now introduced two Orders which have not become law, but which will embarrass the fishing industry. I have received a telegram about those Orders from Aberdeen, in the following terms: Would ask your strong support that subsidy to fishing vessels be at least retained at current level. This association fears that any reduction in these rates coupled with known increases in expenses and diminution in supplies may lead to vessels being laid up with consequent risk of unemployment to all sections of the fishing industry.—Owners, Aberdeen. That telegram speaks for itself.

The second aspect to which I refer is the territorial limits and the manner in which the Government are dealing or failing to deal with that matter, which offers a grave threat to the fishing industry. I cannot elaborate upon this, or the other point. I am grateful to my hon. Friend the Member for Hamilton (Mr. T. Fraser) for giving me this little bit of his time. I thank him, and I hope that the Minister will take into account the points that I have put so very briefly.

9.4 p.m.

Mr. Thomas Fraser (Hamilton)

I am pleased that I told my hon. and learned Friend the Member for Aberdeen, North (Mr. Hector Hughes) that I would be willing to let him have two or three minutes of the time allotted to me.

I listened with great interest to the speech which the hon. Member for Lanark (Mr. Patrick Maitland) has just made. I believe that he spoke with great sincerity, but he was talking nonsense. To say that the problem of employment for Scotland would be solved by the vigorous application of overspill agreements made with the City of Glasgow is just nonsense. It is very difficult to believe that anyone could really put that forward seriously, but I gathered from the tone of the hon. Gentleman's speech that he was very serious in putting forward that proposition.

I know that the Town Council of Campbeltown, with 12 per cent. unemployed, was willing to have an overspill agreement with Glasgow, because it could see no other prospect of getting any other industry brought to Campbeltown at all. The council has no confidence whatever in the President of the Board of Trade or in the Secretary of State for Scotland. The council thinks that if it should undertake to take 2,000 or 3,000 people from Glasgow, then Glasgow would be able to send with them some industry which would give employment to more people than actually came from Glasgow.

But Glasgow cannot do that, either with Campbeltown or any other town at such a distance from Glasgow. Glasgow will find it difficult enough to do with places like Kilmarnock or with Hamilton, which I myself have the honour to represent. Glasgow will find it difficult enough to get industrialists to go out there.

The only way to get Glasgow's overspill population rehoused in expanding communities at a considerable distance from Glasgow is for the Government to put up the industrial buildings in those communities and get the industrialists to go there, whether they are Glasgow industrialists or not. If they build houses at the same time, they will attract the people from Glasgow to live in those communities.

As is usual in these debates, my hon. Friends are always blamed for having painted too bleak a picture of the Scotland of today and the prospects for tomorrow. My hon. Friend the Member for Leith (Mr. Hoy) made an excellent speech in introducing the subject of this debate, but the President of the Board of Trade thought that my hon. Friend had painted too bleak a picture. Then, the right hon. Gentleman painted the picture as he saw it, but not, I suggest, as it is. He had in mind a few industrial developments that have taken place in Scotland in recent years, and he named them. Having named them, he said that that did not look like a very bleak picture; but that was not the picture of Scotland. That was a picture of only a few industries.

Hon. Friends of the right hon. Gentleman, in the course of the debate, have also complained about the Opposition painting too bleak a picture of the Scotland which we are all seeking to serve, and have said that Scotland is really a prosperous country. This has been said several times by Tory Members who have spoken in the debate. Having said that, and having told us that things were not as bad as we said they were, they went on to tell us that about the difficulties of their constituencies, so that the picture that emerged of a prosperous Scotland was more bleak than the picture painted by my hon. Friends, who were looking at Scotland as a whole.

Of course, many people are in employment in Scotland. We have 2 million in employment, but the fact that we stress that we have 75,000 who cannot possibly find a job must not be taken to mean that we are unaware of the 2 million other people in jobs. The President of the Board of Trade could have said to us, "You have 2 million people in work in Scotland; that is not a bad picture", and then sat down. We should have been as well informed about Government policy then as we were after listening to the speech that he made to us today.

The right hon. Gentleman and others have told us that we ought to consider ourselves lucky, because there was a recession in America and unemployment there and in Canada, France and some countries of Europe ranged from 7 per cent. to 9 per cent. while Britain's figure was about 2 per cent. How right the hon. and gallant Member for Roxburgh, Selkirk and Peebles (Commander Donaldson) was when he said that it was not much use saying to an unemployed man in his constituency that we have 1.3 per cent. or 2 per cent. unemployed, for that man was 100 per cent. unemployed.

It is not much use saying to a man who is unemployed, or who is fearing unemployment, that Canada, America, Germany, or Italy have a higher rate of unemployment than we have. Those countries are free enterprise, capitalist countries which do not believe in a planned economy or the exercising of controls, although they are increasingly exercising controls, particularly in the United States of America.

When I was in the United States, just over twelve months ago, some Americans tried to convince me that America was more Socialist than the United Kingdom. They certainly exercise a lot of controls to keep their people in employment. They know full well that unemployment could be worse if they did not have controls. We in Britain are better off in this respect than many of those free enterprise countries. Why is that? The President of the Board of Trade seemed to think that it was due to the Government, but is it? For twenty years now, thanks to Labour pressure, a measure of responsibility for economic well-being is accepted by government. Even the President of the Board of Trade will accept some responsibility now for the economic well-being of the country, but that was not so twenty-odd years ago, when I was unemployed for a very long time.

I thought, when the President of the Board of Trade was speaking, that he did not know and was not very much interested in what he was talking about. One of my great difficulties in this matter, and one of the reasons why I often get into trouble in this House, is that I know only too well what I am talking about when talk about people being out of a job. The Government have increasingly accepted responsibility for the economic well-being of the country. That has been particularly so since the war and since we had a period of Labour Government, when some additional controls were introduced.

The President of the Board of Trade tried to tell us that he still accepted the policy of the Distribution of Industry Act, but in a large part of his speech he was arguing against any control at all. He suggested that it was quite wrong to try to get an industrialist to go where he did not want to go. If he does that, he might as well repeal that Act altogether. The right hon. Gentleman was boasting about the Bill now going through Parliament. Is not the purpose of the Bill which is now before another place to provide inducements to industrialists to go to a part of the country where there is a high and persistent level of unemployment, to carry out activities there instead of in some other part of the country?

Is that not the purpose of the Bill, to induce the capitalist investor to go to a part of the country where there is high and persistent unemployment, whereas, without that Measure, he might invest his capital elsewhere? I thought that the President of the Board of Trade was telling us this afternoon that it was a very bad thing to try to induce industrialists to go to a part of the country to which they did not want to go.

Sir D. Eccles

No. I am trying to do it.

Mr. Fraser

The right hon. Gentleman says that he is trying to do it. I do not entirely accept that. Nor do I entirely accept what he said about industrial development certificates. I questioned him about new factories and extensions and I wanted him to expand a little on what is an extension.

I was never President of the Board of Trade, but I was a junior Minister at the Scottish Office for some time, when we were carrying through a distribution of industry policy, and I know of many very successful industrial developments which took place in Scotland after the war which were extensions of industries in the South. How does the President of the Board of Trade think that we got Metro-Vickers at Motherwell? Was this a new thing or was it an extension? They wanted an extension at Old Trafford and we said, "No".

There is an assumption in some parts of the country and among some hon. Members that an extension is an extension of an existing factory. If that were the test applied by the President of the Board of Trade, there would not be as many new factories going up in London and the South, because many of these new factories are extensions of existing industries. What kind of new industrial development is not an extension of an existing industrial development? There may be odd cases which are completely and totally new and he may be able to refuse in those cases, but if he accepts and passes all the applications which are extensions, then it is not surprising that we see all this development in the South.

The figures for factory building have been produced over and over again. We have been told that in Scotland we have done well since the end of the war in factory building and that London, with 20 per cent. of the country's population, has only 10 per cent. of the industrial building. London has twice the population of Scotland, but at present there is three times the amount of factory building going on in London than in the whole of Scotland and we have now more people unemployed in Scotland than in the whole of the London area. In absolute terms, we have more people unemployed. Moreover, one would think that the Minister would appreciate better than I that a considerable proportion of London's employed population is not employed in manufacturing industries. There is the huge employment in shops and offices.

Mr. Bence

And beauty parlours.

Mr. Fraser

We have all those working in shops and office accommodation in London, all of which provides a considerable amount of employment which is not taken into account at all in considering the amount of industrial building, which is industrial building for manufacturing industry.

Anyone who looks at the figures of industrial building and who feels pleased about what is going on in Scotland must be very easily pleased, because we have the highest number of people unemployed in Scotland in absolute terms and we have the highest number of people on short-time working. The position is worsening all the time.

Then, when we turn to the amount of factory building going on, we find that we have almost the smallest amount of any. In Scotland, there is 5 million square feet under construction at present, in the Midlands nearly 11 million square feet, in London nearly 15 million square feet, and in the Eastern Division almost 12 million square feet.

This makes the speech made by the Secretary of State for Scotland at New Mains the other week complete nonsense. The right hon. Gentleman says that he was talking about Government-financed factories and about what the Government were doing, but he should also have explained the problem which the Government were tackling. He did not do that. He did not show, nor did the Prime Minister in his speeches and the letter which he wrote to Argyll, how much factory building was going up in the whole country.

Recently, I did a broadcast with the hon. Member for Lanark. The hon. Member has now left the Chamber. I am sorry that he has done so, because he had only just arrived when he rose to make his speech. I had not intended to complain about his not having heard the debate, but I think that it is a little rough that he should make his speech and then walk out.

I did a television broadcast with the hon. Member the other week. He was absolutely shocked to know that at present there is between 98 million and 100 million square feet of factory space under construction. He did not believe it. He had been a victim of Tory propaganda. He spoke of half a million square feet of factory space, but he had not got it into perspective at all. That is the trouble with the Tory supporters. It is also the trouble with the Tory Ministers. They believe their own leaflets—their own propaganda.

The President of the Board of Trade says that it would be wrong to stop Scotsmen leaving Scotland. Goodness gracious, no one has asked him for that. What we have been asking the Government to do is to take account of the terrific exodus of Scots from Scotland, this net loss of population each year. We have never denied that people who are doing well in business or in the professions will, from time to time, pack up and go away, and it is a good thing for the British Commonwealth and for other parts of the world that they have done so.

We are not trying to stop that at all, but we do take into account that, with the great industrial activity in the South, there is a lot of unemployment in Scotland. We take into account that we have a net loss of population by migration—a lot come into the country each year, but more go out—amounting to 24,000 or 25,000 a year. We think that that is serious. Last year, the loss was 32,500. We think that that is serious. Incidentally, it is the biggest loss since 1929.

It is, of course, more than matched by the increase in population in London. That is understandable. The Ministry of Labour Gazette warns us that the Ministry's assessment of migration of workers is subject to a wide margin of error, but, according to the figures in the Gazette, about 8,000 insured workers left Scotland last year, while the total population loss was 32,500. But the net gain to London and the South was 33,000 insured workers. To us, that does not seem to be a good thing.

I thought that we passed the New Towns Act very largely to deal with this great accumulation of population in the London area. We undertook to spend a lot of the taxpayers' money, and a lot of the taxpayers' money has been spent in trying to get people out of this area, but, apparently, the President of the Board of Trade, by his grant of industrial development certificates for what he calls extensions, is seeking the reverse, and as we try to get people out of the area, he tries to get them in. The result is that there is a net gain in the population of the most overcrowded part of the Kingdom each year.

We are clearly moving in the wrong direction. During the war, when there was a Coalition Government and we were all good friends, we had many debates about the overcrowded population in the South. It was said that it was desirable strategically, socially—even economically—that we should use the country better; that we should spread the population instead of having one-fifth of it concentrated in the London area. But the President of the Board of Trade is out for more records. He wants a record high population in the London area and, of course, he is getting it each year.

The right hon. Gentleman took credit for every new job provided in Scotland in recent years and for every little factory which had gone up. He wiped his hands completely of responsibility for the 22,500 Scottish people who lost their jobs last year. The right hon. Gentleman has no responsibility for that whatever. All we have is a lot of boasting about some little factories providing employment for about 150 people apiece—"All my own work"—all the gains a credit to the Government, but none of the losses a debit to be set against them. Somebody else must be blamed for that.

The President of the Board of Trade tells us that we must not be too sorry for ourselves in Scotland, that we must not cry "Woe" all the time lest we frighten the industrialists away. But surely we should be allowed to recognise distress among our own people when we see it; and we are not so blind as not to recognise the Government's failure to tackle the problems of our country. We have a responsibility to bring these things forward.

We have never said anything which, I should imagine, would discourage industrialists from coming to Scotland. We believe that our craftsmen are as good as can be found anywhere in the world. We have good reason to believe that our unskilled and semi-skilled workers, those who have manned the new factories which have come in recent years and will man those which will come in the future, are as adaptable as the workers to be found anywhere in Britain. We are proud of our workmen and their workmanship, and we believe that we have a great deal of skill among our technicians and managerial people.

We believe that we can make a bigger and bigger contribution to the economic life of the country as a whole, but we know how capital is organised nowadays. Great finance companies are created which will invest their money where it pays them best, where they will obtain the best return on their capital. We know that, left to the influence of natural forces, the great finance companies will always take their money into the London area and the Midlands, into manufacturing industries, and will completely neglect the rest. That is exactly what happens, because, of course, it pays best to invest one's money in manufacturing industries in the Midlands or London. If money is to be invested in this country, it is invested in London or in the Midlands. This has been so ever since the First World War, and it has been seen clearly to be so.

Knowing that that is so, and believing that it will be a disaster if the rest of our land were to shed its population while the Midlands and London continued to grow all the time, and believing that it would be a bad thing—

Mr. Bence

A tragedy.

Mr. Fraser

Yes, a tragedy—what ought we to do? We should try to introduce inducements to spread industry out a little. We should try to make it just as attractive for the capitalist to go to Dundee or to Greenock as it is for him to go to Birmingham or London. That is what we must do.

I know that the Secretary of State finds it very difficult to introduce the controls which will make it possible for him either to provide the inducements to go to Dundee and Greenock or elsewhere or to exercise the other controls which would make it possible for the Government to put a limit to the amount of industrial development in London, in the Midlands and other such places. They must do one of the two. They must either make it equally attractive to go to the places which are today our particular concern, or they must put a bar against additional industrial development in the other parts. Otherwise, they may as well resign themselves to the prospect of the whole of our manufacturing activity being built around the two areas which I have mentioned.

I have probably spent too long in replying to one or two points made by the President of the Board of Trade. However, we are very worried about, and have a duty to concern ourselves with, the situation in Scotland. The figures published by the Minister of Labour only yesterday show that unemployment was down last month compared with the month before by 1,570. But the important thing is that there was a considerable reduction in unemployment in Aberdeen, the North East, and in the Highlands and Islands, due entirely to the seasonal increase in employment in the fishing industry, plus a small increase in seasonal employment in catering establishments in the North. Altogether, there was a reduction of 2,100 unemployed in those areas. But in the industrial parts of Scotland, in places like Greenock, Dundee and North Lanarkshire, even last month there was a further increase in unemployment. In the four weeks ended mid-May there was an increase in unemployment in the whole of Great Britain of 4,000. The increase in Lanarkshire alone was 1,225. So that we had almost one-third of the increase in unemployment for Britain as a whole.

We cannot be content to leave things as they are. We know very well that if there is to be a general damping down of the economy the time will come when there will be no point in building advance factories. But if there is to be a releasing of the screw in the near future, if the squeeze is to be eased, and the Government believe that we can look forward soon to an era of expansion, will they, in those circumstances, regulate the industrial expansion to provide that the industrial development certificate procedure will be very much tightened up? The procedure is not observed. If it were observed there would not be any question of granting extensions unless the President of the Board of Trade were satisfied that labour was available to take the jobs that became vacant. But he knows that labour is not available at present.

When there is an expansion in our economy so that there is more industrial activity in the country as a whole, will the Government put the brakes on in London and the Midlands and consider the areas where there is a lot of unemployment and encourage industrial expansion there? When that happens, by all means allow Scottish Industrial Estates to build their advance factories. In that event, there is no doubt that the advice given to the President of the Board of Trade by the Scottish Council, by his own regional office in Glasgow and by Scottish Industrial Estates will be seen to be well founded, because, of course, tenants will be obtained for the advance factories which are built.

9.35 p.m.

The Secretary of State for Scotland (Mr. John Maclay)

The hon. Member for Hamilton (Mr. T. Fraser) made what was to me an interesting speech. The one part which I regretted was when he cast quite unjustified doubts upon the integrity and sincerity of what my right hon. Friend the President of the Board of Trade both said and has been doing since he held that office, as his predecessors have done. Inevitably, my contacts with the Board of Trade and with the right hon. Gentleman have been very close indeed in all this period. While I know that my right hon. Friend has a difficult balancing job to perform in thinking of the industrial needs of the whole of the country, I can say with conviction that he has paid the closest possible attention to Scotland's needs throughout all the time I have had anything to do with the matter. I express my gratitude to him for the very balanced and real way in which he has approached our Scottish problems.

The hon. Member for Hamilton almost tempted me to get into a metaphysical argument about controls. The hon. Member knows that I have said in public—I said it, I think, even this morning—that I do not believe in the tightly-controlled planned State. There are certain controls which everyone today accepts as being necessary in the highly complex world in which we live. It may be a matter for considerable argument and discussion in the years to come to what extent the party opposite believes in a system of controls that is much tighter than those which we recognise are necessary—financial controls as against physical controls. [Interruption.] The financial control is a much more flexible one. That is the whole point.

As I said in another speech, to which the hon. Lady the Member for Lanarkshire, North (Miss Herbison) referred in such an interesting way, I still believe that the party opposite is committed in its mind to a form of rigid physical control which cannot be good for the country.

In quoting the figures of comparative unemployment percentages in different countries, we on this side are entitled to take some credit, as far as Governments can take credit for these things. In the years since 1951, we have deliberately set out to make our economy more and more flexible. We have had to retain certain types of financial control, but we have gone for flexibility, leaving it to individuals to make their own decisions wherever humanly possible. There is good evidence that the fact that we have managed to hold our unemployment figures at the level at which they are much lower than those of a great many other countries is, to a considerable extent, due to the flexibility that we have managed to get into the economy in these years.

In the rest of my speech, I shall attempt what is probably the impossible by trying to deal with a great many of the points which have been raised during the debate. That is the purpose of a debate of this kind, but, obviously, I will not manage to cover all the ground, although I will do my best.

The hon. Member for Leith (Mr. Hoy) made an extremely useful, constructive, opening speech. I did not agree with everything in it, but it was a useful opening to a debate of this kind and we are all grateful to him. The hon. Member mentioned employment and unemployment figures, as did his hon. Friend the Member for Hamilton in his winding-up speech. While nobody could be more concerned than my right hon. Friend and myself about the rise in the figures in recent months, both in Scotland and, throughout the country, it is worth pointing out that, even if it is for seasonal reasons—I am glad that the seasonal reasons have produced an improved figure—the figures for Scotland in June, the latest available, were 3,129 less than in February, whereas—I do not want to take any pleasure in this, but it is a fact—in England and Wales they were 7,800 worse. The figure in Scotland, therefore, has been improving. There may be seasonal reasons, but the fact is that we have been moving against the trend of the South. It is well to remember that a year or two ago, when there was a small recession on the other side of the Atlantic which hit this country, Scotland was nothing like as hard hit as England and Wales in that period, both in trade and in unemployment figures.

The hon. Member for Leith said a certain amount about the closures which have taken place as a result of Service cuts. He said that no action had been taken to provide alternative employment. I cannot accept that. Certain actions have been taken. Some have produced results so far, and we hope for results from others.

It is important not to exaggerate the effect of Service closures on the Scottish economy. We do not like them but it is wise to keep the thing in balance. The most recent figure available for the number of people in Scotland who are engaged on defence work was just over 39,000, which is less than 2 per cent. of insured workers in Scotland. In the eighteen months from May, 1956, total defence employment in Scotland fell by just over 8,000, thus affecting under two-fifths of 1 per cent. of the Scottish insured population. This is a slightly smaller proportion than the percentage affected in Great Britain as a whole in the same period.

The biggest industry concerned with defence in Scotland is the aircraft industry. Its growth since the Korean war kept pace proportionately with the growth of the industry elsewhere in the United Kingdom, but it has not so far suffered to the same extent from the recent decline in military aircraft work. Rolls-Royce, which represents the major part of the Scottish aircraft industry, has a substantial volume of work on hand. Scottish Aviation is supplying the civil market and has orders on hand for the Royal Air Force. The future for both these firms, like the rest of the aircraft industry, must lie in their further success in the civil markets.

I should like to give figures relating to what has been happening in one of the places which have been closed down. At Donibristle, despite a considerable run-down of the establishment, not a single worker has been discharged so far as redundant. Up to 26th June, 280 Donibristle workers had gone to new jobs, including 118 transferred to other naval establishments. So far, the whole operation has gone so smoothly that the speed of the run-down has been a slight embarrassment to the yard, where work has still to be completed on schedule. Where these closures occur they cause great concern, but so far there has been no serious effect on employment in that part of Scotland. One can only hope that the same will apply to other establishments which are run down. I realise that redundancies have affected Greenock and my own constituency and that this has something to do with the swelling of the unemployment figures in Greenock.

Dr. Dickson Mabon

The President of the Board of Trade this afternoon made some reference to the position of the Royal Ordnance factories in Scotland. I did not quite catch what he said. Would the right hon. Gentleman confirm that Bishopton will not suffer more redundancy in the present financial year?

Mr. Maclay

My information is that it is a static figure at the moment. It has gone up slightly recently, but I have no reason to believe that the figure will be altered in the near future.

Mr. Ross

Will the right hon. Gentleman make it plain that this situation has been achieved partly by the closing down of a factory at Kilmarnock? The work has been transferred to Bishopton.

Mr. Maclay

One does not want to be sure that because factories close down, because of defence reasons or otherwise, this necessarily means disaster to an area. I should like to thank the Minister of Labour for the extremely efficient way in which his Department moves in and tries to help where large redundancies may become possible.

A number of hon. Members have mentioned shale oil. There is a good deal of misconception about the economic position of the shale oil industry and about the decision of Scottish Oils to close down part of its production this year. In 1957 the preference which the shale industry had was worth £750,000 to the operating company, and the total benefit over the years has amounted to £20 million. The basic difficulty is that the mining and processing of shale is an inherently expensive way of producing oil.

Mr. Willis

We know about all this.

Mr. Maclay

I mention it because I do not think that everybody has heard this before, like the hon. Member. The industry, therefore, cannot compete on anything like level terms with production by the normal method of drilling. The argument that the Government are making a profit out of the industry in spite of the difficult economic position needs to be disposed of. I am concerned about the shale industry, but it is right to get things into perspective. If the industry were to go out of production completely, the Government would increase their revenue by collecting Customs Duty at the higher rate on the imported oil—

Mr. Willis

This is a tortuous argument.

Mr. Maclay

No, it is not, because people have said, and it has been said in the Press, that the Government will lose that revenue. I am dealing with things that have been said and which ought to be corrected. I have said that I am concerned about the position in the shale industry, but it is wise to get the facts right because they have not been understood.

We, of course, are conscious that there is a real social problem in the shale area, and as the then Financial Secretary indicated last year, we have made careful investigations to see what could be done. We have found it extremely difficult to do anything positive for the industry. Those responsible for Scottish Oils said last April that, while they would have to discontinue operating the least economical of the shale oil seams in one part of the undertaking—that is the part which has accounted for almost the whole of the industry's loss—they hoped that after the proposed contraction was completed the remainder of the industry would continue in operation for a considerable time.

Nothing has happened in the meantime to suggest that this is an unreasonable prospect. At the time of the announcement the industry was employing about 2,800 men and it was expected that 300 would have to be stood off by October, 1958. So far 97 have been discharged, and of these 25 appear to be unemployed at present. What it is essential to get clear is that the total reserves of shale in this area, if they could all be used at once, would amount to less than two months' consumption of oil in the United Kingdom. Surely it must be right—

Mr. Willis

rose—

Mr. Maclay

What I am trying to get clear is that people have been talking today, and in the recent debate, as if the Government had done something which was killing the shale industry. It is not true. I have given the figures of expected redundancy. One cannot guarantee the future, but I have quoted what the company has said. The most uneconomic part of the operation is being closed. I sincerely hope we shall find that the present figures will be maintained for a long time to come, but we must face the fact that these reserves are not inexhaustible. In fact, the seams will run out at the present rate of use in about twenty-five years, and it would be wrong to do anything other than what we are trying to do now. As the Chancellor of the Exhequer said, we are doing our utmost to get more industry into the area but, as hon. Members know, it is not there yet.

Mr. Woodburn

Apart altogether from what the Government do, the National Coal Board maintains certain uneconomic pits on which it loses money. It could advance the same argument. This industry is a mere flea-bite, yet it is important to our industry and has been valuable in war-time. Surely we could keep it running, since the cost is nothing compared with the enormous cost of maintaining those pits?

Mr. Maclay

That is why I am repeating the things I have said before. I have been telling the House what has happened in this last year, namely, that the uneconomic part is being closed. This will produce a redundancy of about 300, of which so far only 25 appear to be unemployed as far as can be seen from the records. We have no reason to think that the firm's own estimate will be wrong, namely, that it will be able to operate for a considerable time, though the figures will be watched after the 300 redundancy.

That is not the destruction of an industry, but it would be folly on the part of the Government to ignore the fact that twenty-five years from now there will probably be no reserves, and the policy must be to try to do the very thing that has been discussed earlier—that is the phased move-over—and to try to get industry in at the same time. I hope it is clear from what I have said that this is not the death of the shale industry, which was talked of earlier today and in previous debates.

I think at this stage I might say a word about Greenock. It is perhaps jumping the gun, but I do not see why I should not say something about it. I have noted what the hon. Member for Greenock (Dr. Dickson Mabon) said about the torpedo experimental factory. That is not a matter on which I could give any view tonight, but the point has been carefully noted.

The hon. Member also referred to advance factories. Much has been said by other hon. Members about this matter. The application to which the hon. Gentleman referred was addressed to the local authority, which was asked to put the company in touch with the Board of Trade controller in Scotland who would be able to discover whether space could be found for the company in existing premises in Greenock or Port Glasgow.

We could argue all night on the advance factory issue. I am not certain that that is the right direction in which to go. I have discussed this matter with most hon. Members opposite. I confess that at one time I was a strong believer in it. I have, however, discussed the matter very closely with the President of the Board of Trade, and there is a great deal of evidence that the advance factory is not the catch that it used to be. There is another element to be remembered. If one has a firm which wants a tailor-made factory, it is more likely to be a permanent institution than a firm which goes into an advance factory in a hurry. The time taken to build tailor-made factories has contracted a great deal, and in many cases the time taken to build a factory now will be about the time required by the firm to get the machinery that it needs and go into production.

Mr. G. M. Thomson

Will the right hon. Gentleman remember that there are many instances in Scotland of firms which have gone into small advance factories and then expanded into their own tailor-made factories?

Mr. Maclay

That has happened in a great many cases. I am sure that my right hon. Friend will not object if I say that his mind is not completely closed on this matter. He has shown that he is willing to look at it, but I think the arguments have to be carefully weighed before one does something which may not catch the firms that we need.

I turn now to the argument that I have been having with the hon. Lady the Member for Lanarkshire, North. Hon. Members opposite complain in various ways that Scotland has lost her just proportion of new factory building in recent years. Let us see what has happened. I do not think hon. Members opposite realise that the extensive replacement of war-damaged factories in the South was not included in the statistics before July, 1948. Therefore, the comparisons which hon. Members opposite try to make between what happened in those years and in recent years do not work out, because they omit three years of critical building. Do not let us try to compare unlike with unlike.

Miss Herbison

If the right hon. Gentleman is trying to support his argument in that way, he ought to put before us the square footage of factory building that was not included.

Mr. Maclay

That is impossible, because the figures were not available. At all events, I have not been able to find any way of obtaining the figures because they were kept on a different basis. I will give the hon. Lady a point in a moment. In some ways I rather regret that we in Scotland inevitably get into this argument about how we do in relation to other people. I agree that that is very important, but there is an important point to Scotland and that is the rate of growth of industry.

Broadly speaking, between 1952 and 1957 there was a steadily increasing number of proposals for new building. Scotland suffered a smaller reduction than did the rest of Great Britain in 1956, which was a bad year. Moreover, from 1952 to mid-1957 the industrial buildings started in Scotland represented an employment potential of more than 37,000, or nearly 10 per cent. of the total for Great Britain. That is slightly higher than the figure of 9 per cent., which the hon. Lady the Member for Lanarkshire, North quoted, but I believe that she was using footage figures rather than employment potential, and the drop of 12½ per cent. which she quoted was relatively small when that is taken into account. In 1957, the 4.8 million square feet of factory building completed was the greatest amount completed in Scotland in any post-war year.

Mr. Hoy

If the right hon. Gentleman wants to be honest about this, he must be aware that it is made clear in the Report that that was the result of one very large factory, the largest ever built, having been completed in that year after having been built over a long time.

Mr. Maclay

Are we sorry that that factory has been completed? I hope not. I accept that figures can show a great many things, according to which side one is on, but we have been dealing with figures and I think that we should continue to deal with figures. To complete the hon. Lady's fury with me—she is expressing it in a very charming way—I will give some more figures. It is well worth appreciating that since 1952 17 new American projects in Scotland have been approved. Even more striking is the fact that a total of 150 firms not previously established in Scotland have opened new factories there. That is very important.

To return to the figures which the hon. Lady does not like, if there is an existing area of population and industry, it is clear that the Government can move only slowly to alter the structure of that area. It cannot be done overnight and the most effective thing the Government can do is, to use direct influence, grants and loans and other devices, where they have the power. Although the hon. Lady does not like the figure, I repeat that since 1952 Scotland has had more than 38 per cent. of the Government-financed building in Development Areas. Some hon. Members do not like these figures, but they mean a great deal. More recently, the Scottish proportion has been even higher and in 1957–58, and so far in 1958–59, about three-quarters of Government-financed factory building approved has gone to Scotland.

I do not want to overstress the relative figures, and I do not believe that they are necessarily the answer to anything. However, one is constantly hearing speeches throughout Scotland implying that our record since we came to power has been immeasurably worse than that of the Labour Party. One is bound to correct that impression, and the figures I have given make the position absolutely clear.

It is inevitable that we should argue in a political way over these things, but let us be absolutely united on one thing, that we all want to talk about Scotland and behave in our arguments about Scotland in a way which will encourage people to come and develop industry in Scotland. There is some danger in our political bickering over these things, since it can exaggerate what is bad and wrong in Scotland. If we have to attack each other politically, I hope that in public and abroad we will talk as one about what Scotland is, can and will be.

I have not answered a great many questions since I did not want to be led astray into an argumentative speech, but I can assure hon. Members that have noted all their points.

It being Ten o'clock, the debate stood adjourned.

Committee Tomorrow.