Industry, Employment and Roads

HC Deb 03 June 1959 vol 606 cc197-322

Motion made, and Question proposed, That this House takes note of the Report on Industry and Employment in Scotland and Scottish Roads, 1958 (Command Paper No. 706).—[Mr. Maclay.]

3.33 p.m.

Mr. Thomas Fraser (Hamilton)

This is the occasion on which the House debates the success or failure of the Government's efforts to promote the economic well-being of Scotland. It is a continuing debate, it goes on year after year; and, indeed, it goes on almost from month to month. On 10th July, about a year ago, my hon. Friend the Member for Edinburgh, Leith (Mr. Hoy) called attention to the figures of unemployment in Scotland for 1958 as compared with 1957, and he put on record that, in May, 1957, there were 55,000 persons unemployed, and in May, 1958, the number had risen to 77,500. That was an increase of 22,500 in twelve months.

The President of the Board of Trade, who replied immediately to my hon. Friend, said: 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."—[OFFICIAL REPORT, 10th July, 1958; Vol. 691, c. 605.] We waited for this great improvement. The right hon. Gentleman and his colleagues will know that, six months after he had made that speech, there were 116,000 unemployed in Scotland, and in May, 1959, the number of unemployed, according to figures given by the Ministry of Labour, was 94,628, an increase of 17,000 over May of last year, for which figure the President of the Board of Trade apologised, saying that we were now on the mend, we could safely expand, and this expansion would show results in every industry and every area in the United Kingdom.

These figures are an answer to the President of the Board of Trade and they show that he was misleading in what he then said. Of course, one has ample evidence of this in the White Paper, Industry and Employment in Scotland. In Chapter 1, on what is virtually the first page of the document, there is a general summary showing that whereas industrial production in the United Kingdom as a whole remained fairly level in 1958 as compared with 1957, production in Scotland fell by 3 per cent. But, said the President of the Board of Trade, we were to benefit as a result of the measures taken by the Government. Every area and every industry would benefit. In fact, we have in Scotland suffered a reduction of 3 per cent., according to the Government's own White Paper.

The unemployment figures do not tell the whole story. The numbers in employment are just as important, perhaps even more important. If the Parliamentary Secretary to the Ministry of Labour, who is, I understand, to speak immediately after me, will look at the Digest of Scottish Statistics, he will find there information given by the Government showing that, whereas in 1958, taking the average figures of unemployed for 1958 and 1957, there was an average increase in unemployment of 24,800, the number of those in civil employment has declined in the same period by no less than 48,000.

This is a serious matter. I should have thought that Ministers and right hon. and hon. Members on both sides of the House would appreciate how serious it is for Scotland. Year after year we have been considering the need for more jobs in Scotland. Last year, when things had become rather bad, we were assured by Ministers that we were calling "Woe, woe" far too soon and that things were already on the mend. In fact, things were so much on the mend that, when we received this Digest of Statistics in April this year, only a little more than a month ago, we found that the number of people in civil employment had declined, not increased, by no less than 48,000. The fact that we can have this decline of 48,000 shows that an increase of 24,800 in the number of registered unemployed is not itself a true indication of the seriousness of the employment situation in Scotland.

Usually, we turn to the statistics about factory building to see what attempts are really being made to provide additional employment opportunities. In paragraph 25 of the White Paper there is an account of the new factories and extensions for which industrial development certificates were issued during the year. We find that it amounted in 1958 to just under 4 million sq. ft.—3,968,000 sq. ft. The estimate for the labour force in those factories is 4,700.

When we come to paragraph 26 we find that one-third of the total of the new factory building approved in Scotland is devoted to whisky stores. There is nothing wrong with whisky stores. I am not complaining about them, but the Parliamentary Secretary to the Ministry of Labour should bear in mind that we in Scotland are very worried—and the Secretary of State must be aware of this—because those whisky stores provide very little employment. When one looks at the figure of square feet of factory space for factory building and gets the impression that this will provide employment for one worker to every 200 sq. ft., it shows how misleading can be the total of factory space provided in Scotland last year.

One-third of the total, 1,311,000 sq. ft., is for the whisky industry and the esti- mated total labour force to be employed is given as 420 people. I would have thought that we could easily have taken this amount of so-called factory building out of the total figures, because it is not factory building; it is stores. The whisky industry is prospering and growing. Exports are going up. More whisky is being produced. It has to be put in store and kept for five years before it is exported. No doubt a man equipped with three keys for each lock in order to get into the store will have to go round to ensure that the whisky is still intact.

Paragraph 27 of the White Paper reads: Final figures for the year are expected to show that the amount of factory building on which work was started in 1958 (estimated at 3.8 million sq. ft.) was about the same as in 1957; about 4,000 additional jobs are expected to result". The Prime Minister went to Scotland a little while ago. I do not want to refer to the occasion of his visit to Scotland during the Recess, but he made a May Day speech to the Scottish Tories on Friday, 1st May. I took the trouble to check a reliable newspaper from the Government's point of view, the Glasgow Herald, to find out what he said: A lot of new industry has come to Scotland lately. Under the Unionists factory building has increased by over one-third. Last year alone it provided nearly 9,000 more jobs". Where did the right hon. Gentleman get that from? I have already quoted paragraph 27 of the White Paper which says that about 4,000 additional jobs are expected to result, but the Prime Minister said that "it provided nearly 9,000 more jobs". I have already shown from the Government's own publication that the number of jobs in Scotland declined by 48,000 last year. I know where the Prime Minister obtained the figure of nearly 9,000 from. He obtained it, or whoever prepared his brief for him obtained it, from paragraph 30 of the White Paper. This part of the White Paper deals only with the areas of high unemployment in Scotland and not the whole of Scotland.

The last sentence of paragraph 30 reads: A total of 8,813 jobs is therefore expected to result from all projects approved, started and completed in areas of high unemployment during the year. Who put that sentence in the White Paper? Do hon. Members know what it means? It means that the factories approved in 1956, started in 1957 and completed in 1958 must be considered. The factories approved in 1957, started in 1958 and completed in 1959 are added. Then must be added the factories approved in 1959 which will not be started until 1960 and perhaps not completed until 1961. When they are all added together one gets a figure for this period of 8,813, and the Prime Minister gets a brief to go to Scotland to say, "The factories which were built last year provided almost 9,000 jobs". There is a quotation about figures not being able to lie, but the restrictions on what we say in the House prevent me from completing the quotation on this occasion.

Mr. William Ross (Kilmarnock)

It does not apply to public figures.

Mr. Fraser

In talking about new factories and extensions, the Prime Minister went on to say: When you add the whole together I would say that never has so effective an effort been made by any Government to help the development of the economic and industrial life of Scotland. I have already mentioned the decline in the figure of civilian employment in the year, but what utter nonsense this is.

The White Paper says that in North Lanarkshire nine new factories or extensions to employ 600 people were approved. Does the House realise that there are 14,000 unemployed in North Lanarkshire? However, the Government boast in the White Paper that they gave approval to new factories or extensions to provide employment for 600 people. In the Buckie-Peterhead area, about which we have heard a lot in the House during debates such as this, five projects were approved to employ 410 people.

My hon. and learned Friend the Member for Aberdeen, North (Mr. Hector Hughes) will he comforted to know that in Aberdeen three projects were approved to employ over 50 people. The 4,000 people unemployed in Aberdeen will be comforted to know that during the year the sum total of the Government's efforts to deal with this problem was to give approval to three new factories and extensions—they could not be very big factories or extensions either—which will provide jobs for over 50 people—presumably 51.

The Government have a sorry record in this matter and it is written into their own White Paper. Yet we find the Prime Minister coming along to a Tory rally in Scotland and saying, "Never has any Government made so effective an effort to help the development of the economic and industrial life of Scotland".

I am glad that the Prime Minister found time during that visit to meet some members of the General Council of the Scottish Trades Union Congress. They put to him a well-reasoned case. Some of us have had the opportunity of seeing a synopsis of the case put to the Prime Minister. It seemed to be well documented and I gather from the notes which have come to me that the Prime Minister expressed himself as being most appreciative of the way in which the case was presented to him. He was accompanied on that occasion by the Secretary of State, who knows full well what happened at the meeting.

The Prime Minister made it clear that he could not be expected to reply off the cuff to the many points put to him by the Scottish T.U.C. That was perfectly understandable, but I want to tell the Secretary of State that we in Scotland, and Scottish trade unionists, who look to the Scottish T.U.C. in these matters, are still awaiting with interest the considered reply of the Prime Minister.

One of the bright spots in our economy, in this otherwise doleful document which reports on industrial affairs in 1958, was a 10 per cent. increase in machine tools. It appears to be a bright spot until one reads the relevant paragraph. The first two sentences of paragraph 83 read: Deliveries of machine tools were approximately 10 per cent. higher than in 1957. The rise was caused by a sharp increase in export deliveries as deliveries to the home market decreased by 5 per cent. I thought that the President of the Board of Trade had made clear to us that our economic malaise was part of a world malaise. He had said, I thought, that we were suffering in like manner with other industrial countries in an economic recession. This does not look like it.

I have seen figures of production and unemployment for other countries which have been winning in the competition against us for trade in the export market, but here is evidence in the White Paper of other countries being able to increase their purchases of machine tools made in the United Kingdom and to increase their production. They have done it at the same time as our industry was being so run down that it totalled 5 per cent. less production of machine tools than in the year before.

Another industry of considerable importance to us in Scotland, as to the whole of Britain, is the building industry, in which there has been a dreadful and sorry decline. There is plenty of evidence of that in the White Paper and the other documents published by the Government. Let me quote paragraph 106. I do so because in debate after debate on this subject we have called attention not only to the unemployment in the building and civil engineering industries, but unemployment among the skilled workers in those industries. This has constantly been refuted.

I quote part of paragraph 106 of the White Paper: The average number of people (including office staffs) employed on building and civil engineering work at mid-1958 is estimated at 154,650 compared with 162,500 at mid-1957. Unemployment, which ranged from 11,336 in January to 8,596 in June and to 12,780 in December, was consistently higher than in 1957, particularly among craftsmen such as joiners and bricklayers. It is the Government who have reported this to us at this time. This is not an irresponsible member of the Opposition calling attention to the position in Scotland and getting things out of focus. This is the Government, in their own publication, telling us about the rundown in the building labour force.

Last year, the White Paper tells us, we had 2,000 more school leavers than in the year before. I come, therefore, to paragraph 107 on recruitment and training, which states: The numbers registered in the Building Apprenticeship Scheme decreased from 1,124 in 1957 to 885 in 1958, the reduction in joiners, bricklayers and painters being particularly noticeable, although all trades were affected. The drop was very marked in Glasgow and Fife, where the figures fell from 358 and 98 to 229 and 47. This comes at a time when I thought that an increasing number of people had become aware of the preponderance of nineteenth century slums used as houses in our cities and of the existence of those nineteenth century hospitals of which the Secretary of State spoke the other day when he told us about our old hospitals that were built mostly last century. Notwithstanding that, however, when our people have to live in the nineteenth century houses and have their hospitalisation in the nineteenth century slums and factories are not being built for our workers, we find the sorry state of affairs that our building and civil engineering labour force is constantly being run down and an increasing number of tradesmen find themselves on the dole and a diminishing number of young people are being trained in this industry.

The Minister of Labour told me in answer to a Question on 25th March that between 1951 and 1957—that is, when our economy was expanding—Scotland got 4 per cent. of the new jobs provided in Britain. I had previously known this fact and had used this figure. The Minister said that of every 25 jobs provided in Britain, one came to Scotland, although Scotland had 10 per cent. of the population. When I have used this figure in that form it has been denied. I was told that it was not true and that I was twisting the facts. So I put the question to the Minister of Labour and he gave me the answer on 25th March that Scotland got 4 per cent., or one in 25, of the new jobs provided between 1951 and 1957.

Then came unemployment following the crisis of September, 1957. From then until the spring this year, we in Scotland got 20 per cent. of the unemployment. This information was all given in the same Parliamentary Answer. We had one in 25 of the jobs when they were going. Then, when the time came for the people to go on the dole, we found that one in five of them was a Scot living in Scotland. This does not suggest to me that the Government have been tackling seriously—certainly, not successfully—the economic problems of Scotland.

Once again, I have checked the industrial building. I could go back only to 1953 in the Scottish Digest of Statistics, but could have gone further back in the Board of Trade Digest of Statistics. I find that in the six years from 1953 to the end of 1958, inclusive, the total industrial building in Britain was 260,633,000 sq. ft. Scotland's share of that was 15,600,000 sq. ft. Despite what Ministers have said about 7, 8 and 9 per cent., that figure represents fractionally less than 6 per cent. of the industrial building between 1953 and 1958. When one bears in mind our dependence upon heavy industry, in which there are not so many workers per 1,000 square feet, and the inclusion of the whisky stores in the figures, it is not surprising that 6 per cent. of the industrial building gives us 4 per cent. of the new jobs. That is not good enough.

Under Labour, from 1945 to 1951, Scotland got an average of 12.2 per cent. of the industrial building for the whole of the period that it went up in Britain as a whole. One has only to state those figures, if they are true—and they are; they are taken from the Digest—to show that the Prime Minister was talking absolute nonsense when he went to Glasgow a few weeks ago. It is nonsense for the Government to say that they have tackled the problem for Scotland with anything like the vigour with which it was tackled when a Labour Government were in power.

How long can we in Scotland afford to slip behind the rest of the country? The Scottish Council, in an excellent Report on Employment in Scotland, sent to us all the other day, says that we cannot afford to slip behind any longer. Obviously, I cannot quote much of this document, but there would be no harm in reading quickly through the recommendations. Here they are: It is the Council's belief that there is a pressing necessity for, and resources sufficient to meet, the following measures in the areas of Scotland which have already been specified:"— they are not in the Development Areas, although most of them are—

1. "(1) The building of 2 million sq. ft. of factory space over and above the present rate of Government factory provision.
2. (2) The leasing of these factories for the first ten years at half the economic rental.
3. (3) The maintenance of a float of factory space built in advance totalling 500,000 sq. ft.
4. (4) The postponement of rent increases on existing Government factories where this is shown to be an appreciable consideration to the companies affected.
5. (5) The institution of an investment allowance of substantial size at a rate not less than 25 per cent.
6. (6) An acceleration and expansion of Scottish road programmes.
7. (7) Government assistance in the provision of a graving dock at Greenock.

It is the Council's considered opinion that such measures are essential if Scotland is to survive as a thriving industrial country. Five of those recommendations are exactly similar to five recommendations made by hon. Members on this side of the House to Ministers during the months just passed.

Mr. Thomas Steele (Dunbartonshire, West)

In the year past.

Mr. Fraser

Five of them were specifically mentioned in the submissions we have made in recent months, and many of the suggestions have been made repeatedly in the debates we have had here over the years. We have always been constructive, and we have always put forward positive proposals.

I make the point because it is clear from what I have just read that the policy which we on this side have advocated over the years, the proposals we have put forward, are now finding support among the leading businessmen in Scotland. The leading businessmen in Scotland are members of the Scottish Council (Development and Industry), and they do not accept the laissez-faire approach of the Secretary of State and the President of the Board of Trade. They say that this amount of Government support, this positive provision, is essential if Scotland is to survive as a thriving industrial country. There has been a suggestion from time to time that it is wasteful to spend taxpayers' money on such provision. I remember the former Secretary of State, the right hon. Gentleman the Member for Moray and Nairn (Mr. J. Stuart), saying, in a debate in 1954, that we must no longer go ahead with advance factory building because the economy could not stand it. Scottish Industrial Estates have built approximately 18 million sq. ft. of factories in Scotland. This has represented a total investment of £25 million. It is an investment of £25 million dating back to 1937, spread over twenty-two years. And it is an investment. It is not at all comparable to subsidies given by the Government. I am not criticising the farm subsidy, but we cannot compare the £250 million of farm subsidy with this £25 million, for this £25 million is not a subsidy but investment.

Mr. Cyril Bence (Dunbartonshire, East)

National Assistance.

Mr. Fraser

When one considers the way in which some parts of Scotland were transformed between 1945 and 1951 by the building of factories by Scottish Industrial Estates, and the refusal of industrial development certificates to industrialists who wanted to build in the South, one gets the impression that no Government ever invested money more wisely than both Governments have invested this money in the building of factories by Scottish Industrial Estates.

We cannot contemplate anything less than what we have had recommended to us by the Scottish Council. Indeed, I believe that the Council has not covered the whole ground, in spite of the excellence of the document we have before us. I believe that it has failed to take into account the increase in the number of persons coming on to the labour market as a result of the ending of National Service and the post-war birth-rate bulge. It has not mentioned those two factors. The Parliamentary Secretary to the Ministry of Labour said in a debate in the House on 30th April that these two factors alone would make available an additional 1 million male workers in ten years' time.

Clearly, since we in Scotland have 10 per cent. of the population, one-tenth of that number, or 100,000, will be in Scotland. I suggest that the most marked increase will be in the next three years because it will be then that the bulge in the birth rate immediately after the war will take effect: it is in the next three years we shall have a great increase in the number of school-leavers. It is in the next three years we shall get the additional number on the labour market by the ending of National Service. So, in the next three years, we shall have a considerable addition to the available labour in Scotland. I would think, therefore, that the Scottish Council, because it has not taken this into account, has under-estimated. There is no reason to believe that it has taken this into account in its analysis in thinking that we should provide 12,000 jobs a year in Scotland.

Bearing in mind our existing unemployed and our disproportionate share in Scotland of obsolescent industry, I believe that the Government should set as a target not fewer than an additional 20,000 jobs each year. I do not think that anyone looking at this matter objectively would arrive at a lower figure than the figure of 20,000 additional jobs each year. If we achieve that, we may retain in Scotland some of the many graduates in science and engineering who leave Scotland every year immediately on emerging from our universities.

The hon. Member for Glasgow, Pollok (Mr. George), in a recent debate, called attention to the fact that in the last four years 58 per cent. of all science and engineering graduates had to leave Scotland to find work. The position in Edinburgh was even worse, the figure being 66 per cent. In the most recent reports we find that in 1958 59 per cent. of the science and engineering graduates from the Scottish universities could not find employment in Scotland.

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

May I correct that figure, because I am sure that there is a slight error? I am advised that the latest figure, for last year, was that only 38 per cent. of scientists and 59 per cent. of the engineers left Scotland. The hon. Gentleman has lumped them together. It is a bad figure, but it is an improvement on the previous one, and I should not like the wrong one to go out from the debate.

Mr. Fraser

I am obliged to the right hon. Gentleman. I had the figure, and I accept the correction that the 59 per cent. applies only to engineers.

Mr. Malcolm MacMillan (Western Isles)

Only!

Mr. Fraser

If we could set about providing an additional 20,000 jobs a year in Scotland we could provide opportunities for the employment of this high degree of skilled labour in Scotland. I say that we ought to do that.

The White Paper calls attention to the fact that although, in Scotland, we have 10 per cent. of the population we have only 2.7 per cent. of the research and development workers of Great Britain as a whole. That is stated in paragraph 175. It might be that if the Government would take steps to secure for us a little more of Government research in Scotland than we have at the present some of those people would be attracted to research in Scotland and that might result in making it easier to get more industry in Scotland. The President of the Board of Trade knows full well that a great many of the people who might undertake research in Scotland or in Wales do not do so now because they cannot go far from the research establishments where they acquire the latest scientific and technical knowledge.

Let the Government take steps, as the Labour Government took steps, to get additional research done in Scotland Well-known research is done in Scotland at the National Engineering Research Laboratory, at East Kilbride, which was put up by the Labour Government. Then there is the Ferranti research establishment, in Edinburgh, which was set up on the initiative and with the support of the Labour Government. If we can get more provision of that sort we shall provide more opportunities in Scotland for our highly trained young people who are coming from our universities.

Scotland can no longer survive on the basis of unaided, unsupported private enterprise; and anyone who thinks that it can is misleading himself. That much has been recognised in Scotland for at least twenty years. It has been recognised by all the businessmen in Scotland who are members of the Executive Council of the Scottish Council (Development and Industry).

But can our basic industries anywhere in Britain survive unaided and unsupported? The only basic industries which are not subsidised nowadays are the nationalised industries. Would agriculture survive unaided and unsupported? Would the forestry industry or fishing? What about the cotton industry? Does not the President of the Board of Trade intend to move the Second Reading of a Bill to provide £30 million of taxpayers' money to help the cotton industry?

What about the steel industry? Could it carry on if it did not have generous support from public funds? Would we have had a strip mill in Scotland if the Government had not found £50 million? What about shipbuilding? Would we have the Cunarders replaced if the Government were not willing to put money behind the company building or ordering them?

Sir James Hutchison (Glasgow, Scotstoun)

This is quite inaccurate. It is often said that shipbuilding is subsidised, but if help was given to the ship-owning company to allow it to build, there was no subsidy to the shipbuilding yards.

Mr. Fraser

I said that our basic industries could not survive unaided and unsupported by the State.

Sir J. Hutchison

Quite untrue.

Mr. Fraser

It is not untrue. Could agriculture survive?

Sir J. Hutchison

The hon. Member was talking about shipbuilding.

Mr. Fraser

I was talking about agriculture, forestry, fishing, cotton and steel. Is the hon. Member telling us that Cunard and John Brown can manage very nicely, thank you, to replace the "Queens" without assistance from the Government?

Sir J. Hutchison

I am saying that John Brown gets nothing.

Mr. Fraser

The hon. Member corrects me and says that John Brown gets nothing, but I did not say otherwise. I said that, judging by Ministerial statements, we could not have a replacement of the "Queens" by private enterprise unless private enterprise was supported by the State.

It is for that reason that I wanted to make clear that not only can Scotland not survive on the basis of private enterprise, unsupported and unaided by the State, but the basic industries of the country nowadays cannot survive under private enterprise unsupported and unaided by the State. The State is bound to play an increasing part in guiding the nation's economic life.

Mr. George Lawson (Motherwell)

May I point out that in yesterday's HANSARD it was stated that since 1951 about £1,300 million have been paid out in agricultural subsidies?

Mr. Fraser

I can well believe it. I am not against agricultural subsidies. I think that I am as deeply committed to them and have done as much—

Mr. William Hannan (Glasgow, Maryhill)

Too much.

Mr. Fraser

I have done as much in debate in support of them as anyone. I do not think that anyone who is interested in agriculture would deny that agriculture would be in the doldrums, and farmers bankrupt and suffering a dreadful standard of living, if agriculture had not the support of the State.

Mr. Bence

National Assistance.

Mr. Fraser

The only success stories in the White Paper on Industry and Employment in Scotland are the stories of nationalised industries. The Parliamentary Secretary to the Ministry of Power seems to be having a great laugh to himself. He is having a wonderful time. Has he joined his colleagues in going into the rural areas to talk about the number of farms which are being connected to the electricity supply under Tory rule as compared with the number when the Labour Party were in power? Has he been talking about how much better the Tories have done in rural electrification than the Socialists did?

I have heard the hon. Gentleman speaking at the Dispatch Box about what the Tories have done in the matter of rural electrification. He does not realise, poor man, that he has been boasting about the success of Socialism and nationalisation. It took some years after the war to nationalise the industry and get things going. It is public enterprise and nationalised electricity that is being taken into the rural areas, which would never have known the benefits of electrification if it had been left to private enterprise.

We should attempt a vigorous implementation of the Distribution of Industry Acts to give particular help to particular areas. The development certificate procedure should be used vigorously to prevent undue and socially harmful concentration in certain areas. I am sorry to say that on 10th July last year the President of the Board of Trade, the Minister who is primarily responsible, did not know what he was talking about when he spoke about factory extensions.

Mr. Ross

The right hon. Gentleman was studying genealogy.

Mr. Fraser

Yes, the right hon. Gentleman went to British Columbia where he could find only the Rosses, the Frasers and the Macmillans. The right hon. Gentleman, at that time, clearly did not know what he was talking about when he said that I.D.C.s were given only for extensions in London and the Midlands. I pressed him on the matter in the course of my speech and I was attacked by the Secretary of State for Scotland for having disbelieved the right hon. Gentleman.

Three weeks later, the President of the Board of Trade had to say at the Dispatch Box that he was going to have a closer look at the so-called factory extensions. There is not very much evidence of his having looked very successfully, but, in any case, he had to admit in what he then said, three weeks later, that he did not know what he was talking about on 10th July last year in the Scottish debate.

I believe that what I have proposed would suffice meantime to give Scotland a new deal, but I must make it abundantly clear that if these measures fail, and they do not put our economy on a sound footing and Government intervention is also needed in the promotion of public enterprise in the manufacturing industries, we must not shirk our responsibilities. I do not see why we should not make a start in some of the redundant Royal Ordnance factories. Just as the Government should provide many inducements to new industries to come to Scotland, so they should take steps to see that those we have are not stolen from us. We have had firms with headquarters in England and branches in Scotland closing their Scottish factories when recession comes. That is understandable, but we have had in recent years many cases of English firms buying up Scottish industries simply to close them down.

We have had Hurst Nelson, in Motherwell, bought for the purpose of closing down; Firth Brown, of Sheffield, bought Beardmore's, of Parkhead, Glasgow. Recently goods have been sent out of Parkhead marked "Made by Firth Brown, Ltd., Sheffield" and only last week we had intimation of a considerable pay-off of workers and of no fewer than 1,000 going on short time. This does not look very much like what the President of the Board of Trade promised would be a conscious and safe expansion which would benefit every industry in the United Kingdom.

This is what has happened in Scotland. The Government have the responsibility to secure that we not only have new industries going into Scotland, but that industries are not wantonly taken out of Scotland and that the nationalised industries do not always close their Scottish workshops when they feel the need to concentrate.

There has been a great deal of criticism of the British Transport Commission. I do not know to what extent that criticism is justified, but much concern has been expressed by the workers in Glasgow about the workshops. It was expressed to me personally by those employed in Kipps Works, at Coatbridge, where 10 per cent. of the workers are to be made redundant. We have also seen the closing of Inverness workshops. I have no doubt that the Commission has more efficient and more modem workshops in the South. Why not modernise those in the areas Which most need employment?

What I say about the Transport Commission goes for the boards of other nationalised industries, for the Ministry of Supply and for Government Departments generally. Inasmuch as the Government and Government agencies can promote employment, they should not leave it to the technicians and managers who would like to be near the West End of London, or near their friends in the Midlands of England. We should not leave it to them to decide where the workshops of the nationalised boards or of the Government Departments should be. Let the Government take a positive decision that they should, as far as is reasonable, concentrate their employment in the areas which most need it.

Of course, changes in production techniques and, in the case of the railways, changes in the type of rolling stock, including locomotives, may make redundancy inescapable. We accept that, and the unions accept it, but the Government should try to help areas with a high level of unemployment. Much the same can be said about pit closures in Scotland in recent months. It is true that we cannot produce coal in the same places for ever, but when it is necessary to bring a colliery to an end there ought to be some recognition of the social tragedy that will befall certain communities if no alternative employment can be found. So the Government should take steps in advance to ensure that employment is provided.

Until I heard some answers at Question Time today, I thought that the decision about the replacement of the "Queens" was firm, but I gathered then that there has been no commitment. I was going to welcome this decision on the part of the Government. Last Christmas a group of Scottish Opposition Members of Parliament met nearly all the agencies in Scotland concerned with the economic well-being of our country. Among other things, we called attention to the difficulties now being experienced in the shipyards, and we suggested that the Government should find money to finance shipbuilding, particularly in the smaller and middle-sized yards.

There is no evidence that there is any intention of doing that. I would have thought that there is everything to be said for the Government considering not only whether the "Queens" should be replaced, but also our freight-carrying or cargo vessels. I am thinking of vessels built in the smaller and medium-sized yards. Could there not be some inducement to the owners to replace those vessels, by way of loan or grant? That is what we proposed last Christmas and we also propose it to Ministers today.

It was interesting to note that most leader writers in our Scottish newspapers thought that Labour Members of Parliament were talking absolute nonsense when we first made the proposal, and that the same people now think that it is a wonderful idea to replace the "Queens". It would be just as wonderful to do something to help the smaller and medium-sized yards as to take this step to help the bigger yards.

We were all delighted, last year, when it was decided to erect a strip mill, but we should start now to build factories to attract consumer industries which will use the strip produced. There is no use in waiting until the strip mill is completed and then seeing whether we can get some industry to take the strip which will be produced at Ravenscraig and Gartcosh. Let us get ahead now with the building of factories to attract the consumer industries which will use the raw materials. This is particularly desirable in North Lanarkshire. I do not want to be too parochial—my constituency is in North Lanarkshire—because there are many other parts of Scotland that will need new factory building and which might have attracted to them the sheet steel consuming industries if they could get a little encouragement from the Government to go there.

I hope that we can get an early and favourable decision about the graving dock at Greenock. I have thought from time to time that there are many other industries which are slipping behind in Scotland. We are not doing as well as we should be in the plastic industry, for instance. Bearing in mind that we get so many of the raw materials from Grangemouth and from coal, I think we should do better in the plastics industry than we have done hitherto.

I have spoken too long and I must bring my remarks to an end with the question of Glasgow overspill. This is a tremendous social problem which we are tackling in Scotland. There is not the slightest doubt that the only way to tackle it with success is for the Government to authorise Scottish Industrial Estates to build advance factories in the receiving areas. We cannot wait until there is a high and persistent level of unemployment in the receiving areas for Glasgow's overspill. The factories must be built in advance. If we do this, we can deal successfully with Glasgow's overspill, but if that is not done the plans will be frustrated and indescribable chaos will result in Glasgow.

In addition to the matters referred to in the recommendations of the Scottish Council, the Government should implement vigorously Sections 3 and 5 of the Distribution of Industry Act. Section 3 deals with basic services and Section 5 with the clearing of derelict sites by local authorities. Local authorities are complaining that they put in their submissions when the Government announcement was made and that the matter is still under consideration. If we fail to mobilise the labour resources of Scotland, we shall assuredly fall behind as an industrial nation. The ball is clearly in the Government's court.

4.28 p.m.

The Parliamentary Secretary to the Ministry of Labour and National Service (Mr. Richard Wood)

We have listened to a wide-ranging and, at times, a most entertaining speech from the hon. Gentleman the Member for Hamilton (Mr. T. Fraser). In fact, there were one or two moments in it when I wondered whether the spirit of Derby Day was not getting the better of him.

Mr. James McInnes (Glasgow, Central)

He was on the winner.

Mr. Wood

He probably was. There were one or two points in his speech when I wondered whether the hon. Gentleman was commending or attacking the Government's policy. I was left in some doubt, but perhaps his hon. Friends will clear it up as the debate proceeds. I feel the natural diffidence that any Englishman must feel when taking part in a Scottish debate. In many respects it would have been much better if my right hon. Friend the Minister of Labour was taking part, though even with his illustrious name he had the wisdom to be born in Yorkshire.

Mr. Bence

Whose wisdom?

Mr. Wood

I wondered whether the question might occur to any hon. Gentleman, but the decision was taken that my right hon. Friend should be born in Yorkshire and I think that he has always been extremely grateful for that. But perhaps I ought not to waste too much time on these important details, because I want to get on to even more important matters.

I am conscious that speaking in the debate places a considerable responsibility on me and on any other Government speaker because the matters which we are discussing this afternoon have caused a great deal of concern to my right hon. Friends and myself. I have been fortunate in being able to spend a long time in Scotland, trying to inform myself of some of the problems at first hand, and I was particularly glad, during the Recess, to be able to visit two parts of Scotland which I had not visited before to study problems there.

There are many things, I believe, on which all hon. Members are agreed, and perhaps it would be wise to emphasise those matters on which we are agreed before we consider the points on which we probably disagree. The first matter on which I am certain that every hon. Member is agreed is in sharing the concern which the hon. Member for Hamilton expressed over the employment and unemployment position north of the Border. Secondly, we shall all agree that this problem of the better distribution of industry, which is engaging the hon. Member's attention, is not new but has been with us for a long time and will probably be with us for some time to come.

Thirdly, we probably agree on a number of the reasons which have led to the increase in unemployment from which Scotland is suffering at present. Scotland, as I shall try to show later, is influenced as much as the rest of Britain by a reduction of orders from abroad. It is as profoundly affected as other parts of the island, if not more affected, by the gradual change of demand at home for the products of Scotland. It is affected, as I have seen on many occasions in Scotland, by the decline, for various reasons, of certain local industries.

I will do my best to state the problem as I see it. I was sorry to notice a certain selectivity in the figures given by the hon. Member for Hamilton. I shall try to give the figures without any varnish. They do not present a happy picture, but I want to present to the House the problem exactly as I see it. The percentage of unemployment in May, 1958—that is, one year ago—was 2.1 per cent. in Great Britain as a whole. In Scotland, it was 3.6 per cent. Today, the percentage figure for Great Britain is just higher than it was last May at 2.2 per cent., but in Scotland it is considerably higher at 4.4 per cent.

Although I entirely agree with the hon. Member that the number of men and women at work in Scotland is also profoundly significant, in this part of my speech I want to deal with unemployment and the relatively worse position in Scotland compared with the rest of Great Britain. I am glad to say that unemployment in Scotland has fallen considerably—in fact, by 22,000—since its peak in January, but this fall of 22,000 compares with a fall in Great Britain since last January of 140,000.

The comparison is that the fall in Scotland is just under one-fifth whereas the fall in Great Britain as a whole is just over one-fifth. Moreover, it would be right for me to add that the main reason for the fall in Scotland is a return to work of the numbers unemployed out of doors, which was one of the main causes of the high peak of unemployment in January. As far as I can tell, there has been little improvement since January in manufacturing industries.

During the period from the time the Report begins, in January, 1958, to a little after the time the Report ends, in February, 1959, which contains the most reliable facts I can produce, employment opportunities were contracting in the whole of Great Britain and the numbers employed were falling a good deal quicker in Scotland than in other parts of Great Britain. The main decreases were in textiles, iron and steel, engineering, shipbuilding, building and distribution. I will describe the picture over these twelve to fifteen months. In the first nine months of last year unemployment in Scotland remained fairly constant at 3.7 per cent. and about 80,000. In the last three months of last year there was a steady rise. Between December last year and January this year there was a very sharp rise to the peak figure of this winter.

Since February this year there has been quite a substantial improvement in the building and civil engineering industries and a reasonably substantial improvement in other non-manufacturing industries. There has also been some, but rather less, improvement in a number of consumer goods manufacturing industries, especially textiles, motor vehicles and some engineering. The May figures, which are the most recent figures, suggest that the tide is turning, but it is turning a good deal more slowly than in Great Britain as a whole.

Scotland's heavy industry is inevitably slower to recover than industry in Great Britain as a whole because of the great dependence in Scotland on iron and steel, engineering and shipbuilding, which are all subject to fluctuations in world trade and which, as we know, are notoriously harder to stimulate than other industries by direct consumer demand.

Miss Margaret Herbison (Lanarkshire, North)

The Minister has been itemising those industries in which there has been improvement over the last few weeks. I should like to be certain that his right hon. Friend the Secretary of State for Scotland and the President of the Board of Trade are examining very carefully an industry in which the figures have been worsening, particularly in Lanarkshire, where in the last week, in spite of all the forecasts, the National Coal Board has been unable to find alternative work for almost 100 men.

Mr. Wood

I will certainly examine the figures very carefully. I was trying to explain that there had been a substantial improvement in certain industries and some improvement in others, and I am afraid that the industry which the hon. Lady mentioned is not included in those two categories. I will undertake to examine what she said very closely.

We are left with an overall percentage of unemployment in Scotland of 4.4 per cent.

Mr. T. Fraser

It is 4.5 per cent.

Mr. Wood

That figure has been corrected slightly. I do not want to make a point of it, but it is now slightly below 4.5 per cent.

Mr. Fraser

I have taken the figure from the Minister's own Report.

Mr. Wood

The latest adjusted figure is slightly lower than that which appears in the paper and is just 4.4 per cent., but whatever the figure is it is almost exactly double the figure for Great Britain as a whole.

In one respect things are a good deal worse, because this average figure of unemployment in Scotland conceals, as does the figure in Great Britain, a number of areas with a much higher percentage than 4.4 per cent. These areas are well known to the House, and no doubt the debate will rightly concentrate on them, because they are the areas on which we want to focus most of our attention.

If we focus most of our attention on those areas with a percentage figure higher than the average for Scotland, however, we should remember the brighter side, because there must be some places above the average in employment and below the average in unemployment to balance the worse areas and to make the average 4.4 per cent. The comfort that I take from the areas of lower unemployment is that if some parts of Scotland have been able to overcome certain geographical disadvantages I cannot see why, at any rate to some extent, they should not be overcome in other parts of Scotland in future.

When I sit down, which I hope will not be too long ahead, hon. Members will have a chance to speak about their own constituency problems, and my right hon. Friend the Secretary of State for Scotland will be answering points raised during the debate at the end of the evening. I do not intend to make a mental tour of Scotland, because the difficulties in certain parts are not only well known but hon. Members will describe them with much more intimate and first-hand knowledge than I am able to do. I should like to move to a subject mentioned by the hon. Gentleman the Member for Hamilton which has been one of my very close interests—the subject of the boys and girls leaving school.

The hon. Gentleman suggested that about one-tenth of the one million extra young people entering industry over the next ten years would probably be entering into the labour field in Scotland. I Should not like to quarrel with him, because I do not know the exact figure, but I guess that the share of Scotland is a little below one-tenth, because wherever I have been addressing meetings on this problem I have found that the bulge in Scotland is a little lower than it is in the rest of Great Britain but I do not make any point on that. There is no doubt that the addition to the Scottish labour force, just as the addition to the British labour force, over the next ten years will certainly be substantial.

Mr. Lawson

Has the Parliamentary Secretary considered why the bulge is smaller in Scotland? If he asks his right hon. Friend, he will be told that it is because the birth rate in Scotland has been substantially 'higher over the whole period than in England and Wales. The fact that the population of Scotland has scarcely increased at all over the years is indicative of the huge drain on the Scottish people.

Mr. Wood

I think that the hon. Gentleman had better not provoke me into a discussion about the reasons for the birth rate of Scotland—it is one of the subjects in which I am particularly interested. I do not think that I can go into detail except to say that the hon. Gentleman agrees with me that the share of the increased numbers of young boys and girls that will want employment in the next ten years is likely to be proportionately lower in Scotland compared with the rest of Great Britain.

Concern has been frequently expressed about the difficulty of school-leavers getting jobs, both at the present time and in the near future. In the debate on the 30th April last to which the hon. Gentleman has already referred, I gave figures of those who left school at Easter and who were still without jobs. I am glad to say that both in England and Wales and Scotland there has been a considerable improvement since then. From the latest figures available, those for the 11th May, the number of boys and girls unemployed in Scotland had decreased from 6,894—this is a figure of all the boys and girls and not merely the Easter school-leavers—to 5,355.

Although that is an improvement, I would be the first to say that it was not nearly enough and I want it to decrease a good deal quicker. By 11th May, which was about three weeks ago, about 95 per cent. of those who left school in Scotland at Easter had been placed in employment. That compares with a figure in Great Britain as a whole of 97 per cent. Thus the figure for Scotland is not much below the British figure of Easter school-leavers placed in employment.

As I pointed out on 30th April, there is a matter which gives me even greater cause for concern. It is the question of the number of apprenticeships and other openings for skilled employment which are offered not only in Scotland, but in Great Britain itself. This morning—and I do not know whether other hon. Members have been to see it—I went to the National Education and Careers Exhibition organised by the National Union of Teachers at Olympia. I was particularly interested in the careers section. There I was moved to see the immense number of boys and girls obviously taking the most serious and keen interest in the possibility of careers that were offered. All over the country there is an immense growth in the desire for opportunities leading to skilled employment and it is immensely important that we should do all we can to make available adequate opportunities for these boys and girls.

As the hon. Gentleman said, in 1958 there were 2,000 more boys and girls leaving school than the year before. Between 1957 and 1958, in Scotland the number of boys and girls entering employment which would lead to skilled trades remained about constant. It was 10,560 for boys and 1,500 for girls. If the supply of boys and girls is greater, and the demand for apprentices is greater, the apprenticeships available ought to be increased but they are not expanding as I should like to see them doing so. Even so, the position of Scotland in the provision of apprenticeships, remaining constant as it did between 1957 and 1958, is a considerable improvement over the posi- tion in Great Britain where, as I announced a month ago, the figure actually declined.

Since the war we have had a great many debates about the efforts of both Governments to improve the employment position in Scotland. What appears clear to me is that both the Labour Government and this Government have taken energetic steps to stimulate industrial building in Scotland and I do not see how argument as to which Government has done best is likely to lead to fruitful results. I am convinced that we shall make more progress both now and in the months and years ahead if we try to consider constructively, as the hon. Gentleman did for some parts of his speech, what can be done steadily to increase the diversity of Scottish industry.

We have, and use, our power to build factories in areas where unemployment is most serious. Three of these, which all figured in the hon. Gentleman's speech, are the areas of Dundee, Greenock and North Lanarkshire. There are, at the same time, a number of Government factories standing empty in Scottish Development Areas, but the Government, as the House knows, have taken the decision to build an advance factory at Coatbridge. It has also taken the decision, which the hon. Gentleman mentioned, to site the new strip mill at Ravenscraig.

There are many areas of high unemployment in Scotland which are eligible for assistance under the Distribution of Industries Act, 1958. I am told that up to last week there had been 88 firm and eligible applications for D.A.T.A.C. assistance. Twenty of these have been approved, and are likely to provide between 800 and 900 new jobs. For the rest, eight applications have been rejected and 60 are still being considered. I am certain my right hon. Friend the President of the Board of Trade is only too conscious of the need for speed in deciding these 60 undecided applications.

The hon. Gentleman had something to say about the industrial development certificate policy of the Government. Last July, my right hon. Friend the President of the Board of Trade announced that he intended to examine all applications both for new buildings and for extensions in the more congested parts of the country even more critically than he had done in the past. Since then, industrial development certificates have been granted in the London area only for expansions that cannot be placed elsewhere—and I do not think that any of us would quarrel with that; for new premises for firms that are forced to leave their old premises—generally because they are planned out of their old premises, and for service industries and warehouses.

Whatever we may feel about the needs of Scotland—and I think that there is very little between us on that score—it is quite clear that these industries in London and the South-East themselves require a considerable number of industrial development certificates, as one-quarter of the whole insured population of the British Isles lives down here.

From July, 1958, when my right hon. Friend made that statement, to the beginning of last month, 56 development certificates, referring to about 2 million sq. ft. of factory space, were refused in London and the South-East. At the same time, 31 certificates referring to about 1 million sq. ft. of space were refused in other parts of the country. I need hardly add that in that period no industrial development certificates were refused in Scotland.

But I do not think that even those figures give a complete impression of the effect of that part of the restrictive policy that is being applied under the industrial development certificate procedure. Firms are well aware of the restriction on new development, and many that would otherwise like to build in London and the South-East know that it would be very little good making application. They therefore do not apply.

Many people would like to see this policy of redistributing industry more widely and more wisely around Great Britain make quicker progress. It may be argued that it is economically correct to concentrate industry where the natural advantages are greatest, but I shall carry the whole House with me when I say that it is clearly economically wasteful to refuse the contribution that thousands of men and women are anxious to make in the more remote parts of Great Britain. Again, I would have general agreement were I to suggest that economic wastefulness is not the worst result of a policy of maldistributed industry. Therefore, I think that we are all agreed about the need for industrial redistribution.

Nevertheless, we eventually come to the difficulty that the practical policy for any Government seems to lie somewhere between two extremes. At one extreme is the policy of direction of industry to certain places—a policy which, frankly, I cannot believe enjoys any significant support either in this House or outside, because it is wishful thinking to believe that industry that is directed to go somewhere against its will can possibly be successful when it gets there—

Mr. A. Woodburn (Clackmannan and East Stirlingshire)

Surely the hon. Gentleman would make an exception of Government research establishments. They might not be industrial, but surely they could be directed.

Mr. Wood

I have had it suggested to me on some occasions—but it seems to win little support—that the Government should take powers to direct private industry to places to which it does not want to go. I am suggesting that such a policy is doomed to failure.

At the other extreme is what I might call complete locational freedom. Again, I do not think that that policy would have much support either within or without the House. I therefore suggest that, although there are certain differences between us, which the hon. Gentleman has described to the House this afternoon, they are differences of degree rather than of kind.

What we should all no doubt agree is that the policy of redistribution of industry should be pursued in times when industry is expanding just as vigorously as, if not more vigorously than, in times of economic slackness. If, therefore, in the months to come, the heavy industries in Scotland follow the present quickening of activity in the consumer goods industries, and if the unemployment figures there fall considerably, as I hope they will, it is then, when industry is expanding and more ready than at present to move into new areas, that we must actively and energetically take the opportunity to secure a greater density and diversity in industry in the remote areas of Great Britain that either have little or no industry at present or depend too much on one or two industrial concentrations.

During the past year, I have seen a good deal both of the kind of difficulties that Scotland and other areas of Great Britain suffer, and also of the benefits which diversification of industry can bring to an area. However, in this Scottish debate it is necessary—and perhaps it would not be out of place for me, as an Englishman, to do it—to utter the warning that, as the House knows, it is not only Scotland that suffers from these concentration difficulties. Therefore, this redistribution policy must be pursued in every area that badly needs development.

I believe that in the immediate future we shall have a great opportunity. It is essential that we do not lose it, but it is also essential to remember that whatever the Government do, however warmly the Opposition support them in their efforts, and whatever industry does, the responsibility of Scotland and of those living there is also great. Therefore, in the months ahead, as the economic expansion for which we look takes place, I hope that the Government, the Opposition, industry and the people of Scotland will all seize the most advantage from it.

4.58 p.m.

Mr. John Strachey (Dundee, West)

My hon. Friend the Member for Hamilton (Mr. T. Fraser) and the Parliamentary Secretary to the Ministry of Labour and National Service have sketched the general picture of industry in Scotland, and it was right that they should do so. In particular, my hon. Friend has given us a very vivid account of the difficulties that Scotland faces and the courses that we urge on the Government. It is the part of the remaining speakers to particularise that general picture and to speak about the areas of Scotland that they know. That, very largely, means their own constituencies. Therefore, I want to make a few remarks about the town and city of Dundee, which, as the Parliamentary Secretary said, is notoriously one of the most difficult areas, though perhaps not the most difficult.

Dundee has had a misfortune in that it has been given very large and sweeping assurances by the present Government. If the people of Dundee could find employment in assurances, their position would be very fortunate today. The unfortunate aspect is that the impression has been given that, although some areas of Scotland may face a bad prospect, the prospect for Dundee is considerably better. Some of us may have gained that idea ourselves, but we have been considerably embittered and disillusioned in the months that have gone by, because the fact is that unemployment in Dundee remains obstinately above the 5 per cent. level. Worst of all, in this month it is actually rising. Any city faces a very serious situation if its unemployment figures are rising against the seasonal and against the national trends.

I do not want to survey the whole industrial position in Dundee. I do not want to say anything much today about the main industry in Dundee, that of jute. On the whole, jute had a goodish winter, but there are some signs now of a slackening in that industry. Far more serious than that from the point of view of Dundee is the relatively new and acute menace to the shipbuilding industry there. The Caledon Yard in Dundee, which is a very famous and effective shipbuilding yard, has just laid down the last keel for which it has an order. Today there is no prospect of any replacement to that keel.

I am informed that the prospect of large-scale redundancy—those were the words used—in shipbuilding is immediate. Unless further orders are forthcoming, it obviously must be so, because as that last keel is now being laid, as the particular processes are completed, the men who have been engaged and skilled in those processes fall out of work and there is no new job to which they can be transferred. I am told that this not only affects manual workers but also craftsmen, whom we would imagine would be the very first to be affected. That is bound to spread throughout the yard as the work on this last keel goes forward.

It was disappointing to me that the Parliamentary Secretary had nothing to say about the Dundee situation and the shipbuilding situation in general, because this seems the most acute menace, not only to Dundee but, goodness knows, to the rest of Scotland at the moment. I hope the Secretary of State will tell us something about that and about what projects and prospects there are for the shipbuilding industry, not only in Dundee but throughout Scotland.

The next thing I want to ask is—

Sir James Duncan (South Angus)

Before the right hon. Member leaves the question of shipbuilding, has he any suggestions to make?

Mr. Strachey

It is not for me to make proposals on behalf of the Government, but there seem to be two things which can be done. There may be direct assistance of one kind or another to the shipbuilding industry, stimulation by payment. That is one thing which can be done. The other, which is directly related to it, is the subject to which I was passing, the provision of alternative employment. If it is inevitable that there should be a lower rate of output in the shipbuilding industry, it becomes doubly important that other and diversified industries should be brought to Dundee and other shipbuilding centres.

It is on such schemes that I want to say a word or two. We were given very considerable assurances in Dundee, but we were given those assurances up to something like two years ago, and the progress which has actually been made with them has been desperately slow. One of the major schemes, the Adastral plan, has just been begun. It was begun only at the end of April last. The first sod was turned in April last. Therefore, the prospect of actual industrial employment is still distant.

The other major project, the extension of the National Cash Register factory, is still in the planning stage. It has not progressed beyond that: These two projects, I venture to say, were the backbone of what the Government meant when they said they had in prospect 2,000 new jobs in Dundee. It is now perfectly apparent that those 2,000 new jobs will have very little reference to the employment situation this year, or even next year. They are decidedly long-term prospects, and the delay in those projects and in subsidiary ones is extremely alarming, let me assure the Government, to the people of Dundee.

Why have those projects taken so very long? The Parliamentary Secretary said that the Government had come round to the principle of building advance factories. He quoted one today, the building of an advance factory at Coatbridge. It does remain the only advance factory which has yet been authorised in the whole of Scotland. In Dundee we have been pressing for years for the provision of advance factories on the industrial estate, but nothing has been done and the Government have steadily refused to do anything.

It is the detailed application of the distribution of industry policy, which the Parliamentary Secretary eloquently praised this afternoon, which in our experience in Dundee is having a most laggard application when it comes to the actual provision of new industries there, and it is not only in the building of new factories. I want to give an instance of where it seems to me the general policy of the Government is holding up very seriously developments which could be of great value to a city such as Dundee. I give this only as an example, although it is important itself. It is the example of the Timex works in Dundee, a large American corporation, or perhaps one might call it an international corporation, which manufactures watches. It has proposals for very considerably increased production and for the employment it can give in Dundee, but it maintains that the whole development is largely dependent on it being able on one occasion to import a considerable quantity of foreign watch movements.

I shall not go into the details; in fact, I am not qualified to do so as they are highly technical, but essentially that is the problem. This runs right up against the Board of Trade policy in which the import of watches is not only subject to tariff but subject to a quantitative restriction on a quota basis. I and my colleague the hon. Member for Dundee, East (Mr. G. M. Thomson) have been repeatedly in touch with the Board of Trade on this matter, and of course we appreciate the difficulties of the position. It is true that if what Timex wanted to do in order to get going on this considerable planned extension of its activities were allowed it would make a further major extension in the quota policy and might be thought unfair to other importers who would get no corresponding concession.

What I want to put to the Government is this. Do they not think that in industries subject to these arrangements, of which the watch industry is an important example in Dundee, this whole quota policy is becoming more and more unworkable? When one goes into it one finds that these quotas are on a 1939 base. I used to have some experience at the Ministry of Food in trying to work quota policies for imports of foodstuffs on a 1939 base, but that was ten years ago. What it must be like now, twenty years after the base year, working on a complicated restriction policy, I can hardly imagine, but it produces these tremendous anomalies. A potentially most valuable development like that of Timex is endangered by the inability of the Government so long as they are working this quota policy—I can see the genuine inability to do very much, but I trust we shall persuade them to do something—to help the town.

I should say—perhaps it may be an unexpected conclusion—that if in the case of the watch industry they wish for security or defence reasons to give a special degree of protection, they ought seriously at this time to consider doing it by the ordinary, straightforward tariff method. There is a 30 per cent. duty on watches already, I should have thought that they ought seriously to consider—and this applies not only to Dundee and to Scotland but to the whole country—whether this industry would not be far better protected by the appropriate level of tariff, whatever they might consider that to be, rather than by attempting to carry on this more and more hopelessly out-of-date, quantitative import restriction on quotas.

When I say that, let me add that if they were going to do anything of that sort the Board of Trade would no doubt wish to have reciprocal arrangements from foreign countries, from the Swiss. If a valuable concession were made on our part, if liberalisation were to be given, no doubt they would wish for reciprocal arrangements from the countries that would benefit, in this case mainly Switzerland. It may be that some of those engaged in the watch industry in this country may not like what I am suggesting, although I think many of them would agree that sooner or later the quota system must come to an end and that the industry would run much more healthily under the more limited form of tariff protection. I am deeply impressed by the complete inability of the Government, so long as they carry on a quota system in this industry, to do what I am quite sure the Government wish to do as much as we do—to free the development of this potentially very valuable enterprise in a place like Dundee.

I quote the Timex example because I think it is of intrinsic importance to Dundee and because it seems to me to suggest a policy which, properly and suitably applied, may help development in all the difficult areas of Scotland and, for that matter, the United Kingdom also.

That is an essential in Dundee, and it seems to me that there should be the reapplication of development, with all the urgency and haste with which it was done in the earlier years under the previous Government at the end of the war. No one can complain of what the Parliamentary Secretary said about his fidelity and his enthusiasm for a distribution of industry policy, but that is not at all the attitude which the Government and Government Departments have displayed in practice in the case of the allocation of industry in areas like Dundee, and I am sure that most of my hon. Friends will give similar instances from Scotland when they speak.

How did we begin this period of renewed difficulty in Dundee? It began when the Board of Trade closed down its local office in Dundee because it considered that the allocation of industry policy had run its course and could now be progressively liquidated. The whole reimposition or reapplication of the distribution of industry has been done most unwillingly and in a most laggard frame of mind because it has run counter to the laissez-faire philosophy, not, evidently, of the Parliamentary Secretary, but of the President of the Board of Trade in particular. It is that whole philosophy and approach which has had so deadly an effect on areas like Dundee.

We do not believe—and I must, in conclusion, repeat what my hon. Friend the Member for Hamilton said—that under a policy of industrial laissez faire areas like the west of Scotland and Dundee stand any chance whatever. It can only be done by a conscious and purposeful application of the distribution of industry policy and by the provision of sufficient inducements, whatever they turn out to be, by way of reduction of industrial rents and the like, by the refusing of building licences and development licences in other areas, by the carrot and the stick. No one has suggested actual industrial direction. If he will forgive my saying so, I think that the Parliamentary Secretary raised that as a bogey. No one has dreamt of suggesting that, but we are suggesting that the thing should be done by inducements on a sufficient scale and by the refusal of licences to industrialists to go where industry is not wanted or, at any rate, not wanted with nearly the same urgency as it is in these areas.

The thing can be done, but we have not experienced in practice the will to do it in these areas of Scotland which we represent, and until this is expressed in practice by a real drive on the part of the Government we must regard the honeyed words of the Parliamentary Secretary as of very little value, because it is actually what is done that matters. Until the officials of the Board of Trade, the Ministry of Labour and National Service the Scottish Office and other Departments concerned are all imbued with an urgent desire to push this thing through and to overcome the necessarily very complex questions and difficulties, we shall go on pressing the Government with the utmost of our powers.

5.18 p.m.

Mr. John Brewis (Galloway)

I have met with so much kindness from both sides of the House since I came here that I am encouraged to claim the indulgence of the House in making my maiden speech.

I am the Member for Galloway, and I think that many hon. Members on both sides of the House have recently had the opportunity of visiting my constituency. I am sure that all those who did not know it before came away impressed by the beauty of its scenery, its efficient and well-kept farms and the friendliness of the people of Galloway.

At the same time, we have in Galloway unemployment problems, too, mainly caused by the closing down of defence establishments. For example, our unemployment rate is now twice what it was four years ago. In my own town of Stranraer, unemployment now is 6.4 per cent. compared with 2.5 per cent. a year ago. This is caused partly by the closing down of the flying boat base at Wig Bay. I think that flying boats are now becoming a redundant industry, but there are, at Wig Bay large hangars and a slipway and other very valuable facilities. Any firm wanting to build boats or anything of that kind would find in Stranraer many well-trained joiners and other tradesmen to carry on such an industry.

The real problem at Stranraer is that of the great military port of Cairnryan. For many years Cairnryan has been used for dumping unserviceable Army ammunition, but I am afraid that this also is becoming a redundant industry. The War Office has advertised Cairnryan for sale and appointed a well-qualified firm of London agents to dispose of it. I am glad to say that there are several firms interested in the port and at least one of them would be able to give employment to no less than 200 men.

Stranraer is a D.A.T.A.C. area. One knows that an industry coming to such an area is eligible for grants and loans and rent rebates if it is intended to start a factory. But it seems that rather different considerations apply when it is a port which is available and not a factory. In this case, we are to witness skilled negotiations by a London firm of estate agents to dispose of this port at the highest possible price. What is more, we are about to witness one of those fashionable package deals by which an industrialist coming to the port will be urged to take over a great deal of surplus W.D. equipment, much of which could not possibly be required, such as Army huts, engine sheds and things of that kind. When a firm of estate agents is instructed to act in such circumstances, it should also take into account the value of finding employment for 200 men, which might well amount to as much as £500,000.

In such a deal as this, any firm wishing to start a bona fide factory would have only a certain amount of capital available, and, therefore, in such an auction it is bound to be the firm wishing to dismantle the whole place which would be able to make the highest bid. I asked my right hon. Friend the Secretary of State for Scotland to take up this matter at the highest level possible and to see that Cairnryan and Stranraer are treated like any other D.A.T.A.C. area. If an English firm of industrialists proposed to come to Stranraer to start a factory, a red carpet would be laid down by the Board of Trade and the firm would be asked what it wanted. It would be offered loans and possibly grants, and it would be sold only what it actually required. The rest of the equipment would be sold separately for scrap.

There is also the question of the Glasgow overspill. Stranraer has entered into an agreement with Glasgow regarding overspill, and we are wondering what sort of industry we shall get to keep the people employed. I know that my right hon. Friend the Secretary of State is very interested in shipping, and I suggest that he should overspill some shipping to Stranraer. After all, we have there a port big enough to take a battleship at low tide. We have very good railway communications with London and Glasgow, and there is an excellent labour force available. What is more, Cairnryan is the only big port between the Mersey and the Clyde and, therefore, is of considerable strategic importance to the nation. It would be a pity if this great port were abandoned and allowed to rust away.

I wish also to refer to a town at the other end of my constituency, that is, Dalbeattie, near Dumfries. Dalbeattie is a small town in most beautiful surroundings. Hon. Members who have seen pictures in the Scotsman today of Kippford will agree about what a beautiful area it is. Dalbeattie has an industrial background. It has a textile works and its people are experienced in papermaking, woodworking and granite quarrying. Owing to the closing down of the nearby Admiralty depot, there is unemployment in the town. A rather strange thing in Galloway is that it is the Army which runs the port, the Royal Air Force which runs the seaside bases and the Admiralty which runs the inland ammunition dump. The Admiralty depot would make an excellent site for a new industry.

Unfortunately, Dalbeattie cannot be scheduled as a D.A.T.A.C. area because figures of the unemployment population are not available. The local Ministry of Labour and National Service office covers half the Stewarty of Kirkcudbright. It is clear that unemployment in the burgh is fully as high as at Sanquhar, which has the good fortune to have a local Ministry office and there are figures available. The town of Douglas, Lanark is in the same boat. I think the Government should do something about these small places and not rely entirely on figures of unemployment which may or may not be available.

In such a debate as this we are concerned more with the towns and cities, and particularly the industrial belt between Glasgow and Dundee in Central Scotland. But I feel that we should also have some regard to unemployment in the country. A hundred years ago, in every village and small town it would be possible to find a cobbler, a wheelwright, a blacksmith and a millwright, and probably also a tailor and a tweed mill. Now we buy our shoes mass-produced at Northampton. The wheelwright, millwright and blacksmith have been replaced by the agricultural engineer who comes out in his little van from the neighbouring town. The tailor and the tweed mill have gone and we buy our clothes from the multiple store in the nearest town.

In effect, this means that the only employment in the country areas is in the agricultural industry. That is a satisfying employment and the industry is becoming ever more technical. But there is not much opportunity for female labour, nor is there much opportunity for better educated boys to get on and to improve themselves. We must try to get more industry into the country, and, if possible, within a half-hour bus ride from most of the villages. Even in Glasgow one is lucky to be able to get to work in less than half an hour. I am thinking in particular of small industries like Cree Mills, in Newton Stewart, and Solway Pre-cast Products in Creetown, which draw their labour from neighbouring villages.

To see what can be done one has only to look across the Irish Straits from Stranraer and contemplate the huge B.T.H. factory at Larne in Northern Ireland, the sister port to Stranraer, the huge chemical works at Coleraine and the tobacco factory at Ballymena. I feel that we should pay more attention to this side of the problem, unless we want to see more rural depopulation.

I was particularly sorry to read in the White Paper, Industry and Employment in Scotland and Scottish Roads Report, 1958, that there was no reference at all to Galloway until paragraph 237, where it is catalogued that another enterprise, the Silver City Airways ferry to the Isle of Man and Ireland, has closed down. When a ferry boat in the Highlands has seats which are not comfortable enough, the protests of Dame Flora McLeod are heard right round the United Kingdom. Dame Flora McLeod is a very distinguished Scots woman and deserves to be listened to. But I am very sorry to see that this ferry service has been withdrawn with no protest at all. I hope that next year we shall see more attention being paid to Galloway in the White Paper.

Before I sit down, I should like to say something about what I consider should be done about Scotland. First, the problem in England and Scotland is rather different. In England it is a question of distributing industries from areas where there is too much industry, such as the Midlands and London, to areas where there is not enough industry, such as Lancashire. In Scotland, there is not one area of over-full employment. For example, the Glasgow overspill is a problem of population and not of redistributing industry.

The first thing I should like to see is the whole of Scotland scheduled as a development area. After all, unemployment in Scotland as a whole is over 4 per cent. I do not think that my suggestion would attract a single new industry to Scotland, but it would enable special Scottish subsidies to be given separate from the rest of the United Kingdom. For example, I should like to see factory rents reduced. In Northern Ireland, factory rents are about 9d. per sq. ft. In Scotland, they average between 2s. 3d. and 3s. 9d. per sq. ft. Taking into account the disadvantage of distance, factory rents in Scotland should be reduced to about 1s. 3d. per sq. ft.

I should also like to see an increased investment allowance for industries in Scotland, in addition to the existing capital investment allowances. This is quite feasible, because, after all, we had such an allowance in 1955. Both these would be administratively feasible, but they are subsidies of a capital nature. The manufacturer coming to Scotland looks, first, at his cost accounting. If he is provided with a factory rent and rate free in a remote area, he still cannot make it pay unless his costs are right. For that reason, I should like to see further subsidies of an income nature.

I should like to see a subsidy on transport. I know that a flat rate for transport or "an accentuated taper", as I think it is called in technical language, is not very easy to administer, but manufacturers could be given a subsidy of about 25 per cent. of their transport bills. That again is feasible, and it was done at the time of the big wind blow in the Highlands in 1953 in order to get the timber away. It could be done again.

Another subsidy, or an alternative subsidy, which I should like to see is a subsidy on fuel—electric power, oil and coal. This is feasible, because it is being administered now in Northern Ireland. One of the advantages is that, by having a subsidy on coal, but not having the same subsidy on oil, the coal industry could be encouraged in Scotland. An industrialist is just the same as any other member of the public. If he is offered something for nothing, it is very difficult for him not to accept it. Such a subsidy would increase the amount of traffic going on the railways. It would also increase the amount of coal used.

I must thank hon. Members for their indulgence in listening to me putting things right in Scotland in ten minutes, but before I sit down I should like to pay a tribute to the late Member for Galloway, Mr. Jackie Mackie. He represented Galloway for an unbroken spell of twenty-seven years. This was really his life. He loved Galloway and he knew thousands of his constituents by name. He also loved the House and was greatly loved here. Above all, he was a good House of Commons man. I hope that I also may in due course learn to carry on the great tradition of Mr. Mackie.

5.35 p.m.

Mr. J. Grimond (Orkney and Shetland)

It is my very pleasant duty to express on behalf of the whole House our admiration of the way in which the hon. Member for Galloway (Mr. Brewis) has made his maiden speech. I am sure that all hon. Members found it a most attractive speech and full of very wise suggestions, which I hope the Government have noted with care.

Before I come to the details of the hon. Member's speech, I should like to pause for a moment to respond to the remarks he made about his predecessor. I am sure that Mr. Mackie is looking down on us this afternoon and has noted with pleasure that once again the English have been good enough to fix the Derby on the day of the annual Scottish debate, thereby allowing us to have the Chamber to ourselves and, as the hon. Member for Galloway said, to put things right in our own country.

The hon. Gentleman made a most excellent speech, and it succeeded in not being controversial, not even about the Government. I thought that the hon. Gentleman's attitude to the Secretary of State was perfect—firm, without being brutal. I look forward to the time when the hon. Gentleman feels a little less inhibited, when we may see his real fire directed at some faults which he feels could be put right. I think I am right in saying that the hon. Gentleman already has considerable experience in local government in that part of the world which he represents. He obviously speaks with deep knowledge of these problems. Many things which he said, especially his plea for a mixing of agriculture and industry in the countryside, must wring chords on the harps of hon. Members who represent other rural areas.

It is necessary in this annual Scottish debate that we should speak for our own constituents, but our constituencies, whether they are in the deep south of Scotland, like Galloway, or at the other end of the country, as mine is, illustrate many of the same difficulties. Galloway has its Cairnryan and its Wig Bay. In Orkney we have Lyness. Incidentally, if the hon. Member for Galloway has any flying boats to spare I could use a few of them in the far North.

The sad thing about Scotland is that, wherever one looks, unemployment is higher than in England and, in some eases, as has been said today, it is alarmingly high in absolute figures. The percentages are important, but what everyone agrees is so serious about unemployment is that, however few people are unemployed, it is immensely destructive to their self-respect and also to the life of the communities in which they live. In Shetland, about 700 men and 27 women were on the unemployment rolls three weeks ago. In Orkney, about 100 men and 21 women were unemployed. These are not enormous figures compared with other parts of Scotland. In some parts of the Highlands unemployment has been as high as 40 per cent. However, these figures are high enough. It must be remembered that all over Scotland the figures of emigration should be added to the unemployment figures. I think that the hon. Member for Galloway is an immigrant, and that is a very heartening sign, but the sad thing about Scotland as a whole is that not only are people unemployed, but they are leaving because they do not see any hope of full employment in the future.

I sympathise with any Government in the difficulty which we must face, that in a free society labour and industry cannot be directed. Certain inducements may be offered, but ultimately it is for people to decide whether they want to put a factory in a certain place. Even though they may be forbidden to build it in one area, they cannot be forced to build it somewhere else.

However, the atmosphere and the legislation of a country are never neutral. It is not unfair to say that of late years the whole atmosphere of the country and the tempo of much of the legislation has not been an encouragement to rural areas in the north of Scotland. There are a great many illustrations of Acts which may work well enough in the South but do not work well in the North. Furthermore, the effort to bring new industries to the North of Scotland has not been the success which we hoped it might be. Freights are still a great obstacle. I do not want to seem to criticise D.A.T.A.C. My own experience is that D.A.T.A.C. is most courteous and conscientious, and such applications as have come from my constituency have been excellently dealt with. Indeed, I should like to thank and compliment the members of the Committee for their work. But one small point is that speed is important. I am not complaining that they are slow, but very often we get a businessman who feels that he can expand. I know such a man who wants a warehouse. If he is to get going, he wants an answer quickly. He has to fix up with his bank and with his customers, and the quicker such applications can go through the better.

I will speak briefly and make a few suggestions as to what can be done within the present framework and in the reasonably near future. I think that the Highlands need a development board. The Secretary of State should look at the number of bodies which at present deal with Highland affairs and see whether more emphasis can be put on development rather than on administration.

I certainly think that the time has come—as soon as the Fleck Committee reports—to combine the White Fish Authority and the Herring Industry Board and to give encouragement to new lines of fishing and the processing of fish and to new light industries. The fishing industry is a very promising industry. It is one of the industries which keeps people in Shetland. There must be great opportunities for expanding the industry by the introduction of new methods in the seas around Scotland.

I hope, too, that the Government might try a fresh approach to private industry. I know that we have the Scottish Council, but the hon. Member for Galloway pointed out what has happened in Northern Ireland by getting hold of people like Lord Chandos and others and launching a joint effort between the Government and private industrialists.

A great industry in the Highlands is the distilling industry. It does a very good job although it does not, in fact, employ large numbers of men. It makes big profits, most of which are taken by the Government. What I say about the industry is not in criticism of it. It pays an enormous amount of taxation. It helps agriculture, but, of course, it is not a charitable organisation. The fact remains, however, that the distillers draw immense wealth out of the Highlands, most of which, as I say, is taken by the State.

It is now the custom for big companies to contribute to what they consider are worthy purposes. When subscription lists are opened, whether they be for the Refugee Year or anything else, they subscribe. I am not saying whether it is right or wrong or whether they should first consult their shareholders. But it is the custom and one of which many people approve. I am not asking that these companies should set up charitable businesses in the Highlands, but I believe that we have there a lot of people who have intimate contact with the Highlands and who might be brought in with the Government in an effort to find new outlets for industry and employment in the area. Again, I think that they might be asked to contribute to a revolving fund, to assist by way of loans and grants small indus- tries to start up or to take part in experiments in further education and training.

I think that most people who have tried to get industry to the Highlands will agree with me when I say that one difficulty is the question of the present form of education and the lack, perhaps, of further education facilities in large parts of the area. Then there is the difficulty of getting managers. Managers today can get such excellent jobs in the South that to persuade a man of real calibre to settle down and find a house and education for his children in the North is often difficult. A lot of local people do not want to take jobs of a managerial sort in their own area. Others find that they cannot get the necessary training or experience unless they go away to get it. This is a real problem in which private industry might be of some help in co-operation with the Government.

I am perfectly certain that something more radical must be done about crofting. Everyone is agreed that the small croft will never yield a living from agriculture alone. It has to be combined with industry. It is a mistaken policy to give very high grants for agriculture to crofters and yet to refuse them assistance when it comes to light industry. If we could build up light industries, especially those which would use the local products like fishing, weaving or knitting, then we might be able to bring new life into the crofting areas. In a great many of these areas agriculture alone will not do it. There are some in which agriculture could be expanded, but there are others where agriculture must be combined with industry.

One last word about the situation in Scotland in general. If we look at the areas of high unemployment, apart from special areas where, perhaps, some industry is going through a difficult period, we see that they tend to be worse the farther one gets away from London. London is a tremendous magnet. I do not want to go over the argument about industrial certificates. It is not only a question of people being given permission or not to set up factories near London. There is a great social attraction to London. Wives want to get down to the South. Banking and accountancy and the law tend to drift south. I ask the Government to do all they can to see that people are not drawn away from Scotland to the South—they can help a great deal to build up Edinburgh and Scotland generally.

I do not know whether hon. Members have seen the tape this afternoon, but it is reported that Scottish Cables are going to be taken over by British Insulated Callender Cables. This is something which has been going on all my life. Only occasionally does one find a person such as the hon. Member for Galloway who goes the other way.

The real thing is that the Government are the fountainhead of this and the more they can do to devolve decisions, to encourage people to go to Edinburgh and to make special exceptions wherever they can to meet Scottish needs the better.

I want to make two points. The first is the sort of exception about which the right hon. Member for Dundee, West (Mr. Strachey) spoke. There are special needs in Scotland, and it would help if the Government could be more flexible in their implementation of policy. The other point is the seasonal workers' regulations. As I say, it is not only unemployment which concerns Scotland but the drift away from Scotland. In my constituency at the moment there are people who cannot get work all the winter owing to the climate. Among those who are laid off in the winter are the men who work on the roads and other jobs for the county councils. It is essential in the crofting districts to have part-time employment. At the moment they are denied benefit and they are encouraged to go South.

The dockers in Lerwick have no port scheme. They, apparently, have been told that they cannot establish a pattern of employment which entitles them to benefit. It is a very serious thing if we are going to tell people in the far North that they must go away and take jobs elsewhere. It will have the effect of depopulating the area still further. If the Government want to help these people they must be prepared to make reasonable exceptions in regulations designed for the whole country.

I have been rather telegraphic in regard to this question, but I ask the Government to look again at their failure to reverse the trend by which Scotland is always behind England in new industry and a bit ahead in unemployment.

5.50 p.m.

Sir James Henderson-Stewart (Fife, East)

I think we are all agreed that this annual debate on employment in Scotland is for us a very important occasion. The fact that it is Derby Day just adds to its significance. If we back the right course this afternoon, there is no saying what might result.

Throughout this Session, as in past Sessions, opportunities have been offered and accepted to discuss a wide variety of topics affecting our national life. The past year has been outstanding in that way. There have been very few major problems that we have not looked at in one way or another in that time. But they have all been individual issues. This evening we have the chance and the duty to survey the economy of our country as a whole. This is a very important moment. It is an occasion of first-class concern to Scotland, and we probably all want to take the best possible advantage of it. Now, as always, there is a temptation to rake up the past and criticise each other for shortcomings or mistakes. I do not rule out that possibility; that is the way Parliament works, and I have done my share in that kind of exchange of views. But I think that I reflect current Scottish opinion—and, perhaps, the opinion of hon. Members opposite—when I say that today it is right to concentrate on the present and future rather than upon the past.

The first fact to be noted about the present is that a great many activities are on foot in Scotland. There is a conscious national demand for improved conditions. There has probably never been a time of more anxious, if co-ordinated, thought about our national welfare. The evidence of this is widespread. Local authorities throughout the country, in increasing numbers and with a growing zeal, are applying themselves to the task of improving their surroundings and increasing the social and economic prospects of their areas. The Scottish Council maintains its enthusiasm, and is spreading its wings not only at home but in the outside world. I was very pleased to hear my hon. Friend the Member for Galloway (Mr. Brewis) refer to the fact that individual farmers as well as industrialists are constantly introducing new methods, some of which are giving a lead to the whole world.

Despite what some hon. Members opposite would say, the Government have not failed to respond to the national urge. They may not be doing enough. About that I shall have some things to say, because that is my view, but no unbiased observer can deny that during the past few years very substantial efforts have been made and projects advanced for the improvement of the state of our country. I am not sure that Scotland realises even now the potential magnitude of the strip mill, the extent of the support given to agriculture, or the size of the Forth Road Bridge undertaking, to mention only one or two projects. Nor does our country realise the remarkable recovery in our financial and economic standing at home and abroad, which underlies all our prosperity. We should not belittle our own achievements. Other countries do not; in fact they envy the progress made in our land.

I am in agreement with much that has been said by hon. Members on both sides of the House, however, to the effect that, despite all our efforts in the past, by different Governments and agencies, the Scottish economy is still built upon somewhat unsure foundations. We are still much too dependent upon the traditional heavy industries and too short of light industries, with the result that it needs only a breath of depression in steel, coal or shipbuilding—from whatever source it may come—to inflict sudden and perhaps heavy unemployment upon the more sensitive areas of the country.

We all know that very well, and, generally speaking, we all talk the same language about it. There is general agreement about what is wrong and, in a vague kind of way, about what should be done to put it right. But a great deal of that talk is in shibboleths. As Scotsmen we are very good at propounding principles, especially when they are a little out of date—

Mr. John Rankin (Glasgow, Govan)

That is not true.

Sir J. Henderson-Stewart

I am expressing a view—but we are not nearly so good at discarding out-of-date ideas and grasping new ones. Yet to grasp these new conceptions should be the very breath of life to our country.

The dominating influence of our time is probably the relationship between men and machines. Scotland is confronted with the emergency of a rising, better educated and more ambitious industrial population, seeking employment in an age of increasing competition from machinery in every part of the world. To maintain the present numbers in work in such conditions is a very difficult task, and to employ all the labour resources which will become available—I am told that the figure is estimated at about 10,000 or 15,000 people a year, for the next ten years—is a very big proposition. It is a formidable prospect.

We should not shrink from that prospect, but if the target is to be reached we shall have to do some radical rethinking about the future. How is this expansion to be brought about? As was said by the hon. Member for Hamilton (Mr. T. Fraser), the Scottish Council has recently put in our hands a series of recommendations. I would not criticise any one of them, but they appear to fall far short of Scotland's needs at this time. Nor do I see much hope of the emergence of new, bright ideas from any other quarter. I have thought deeply about this matter for a long time and have come to the conclusion that we shall not solve the Scottish problem by anything short of a full-scale investigation of our present needs and a carefully prepared five-or ten-year plan covering the whole country for the years ahead.

Such a plan would have to take account of the possible changes in the supply of fuel and power, and transport. It would have to take note of the developments likely to occur in shipbuilding and steel—and more particularly in the Ravenscraig project, which may be the brightest star on the industrial horizon. It would have to take note of the spread of industry throughout the country, the Tay and Forth Valleys and further north and south. It would have to note the contribution made by agriculture and fishing, and it would have to provide for the inevitable expansion of our roads. Underlying all that and basic to the whole conception of the future if it is to be prosperous will be the part to be played by the banks and the National Exchequer.

The Scottish Council appears to be satisfied, so I understand, that adequate capital is available in Scotland for all worthwhile industrial projects. I cannot share that view.

Mr. McInnes

I am interested in the hon. Gentleman's contribution, because his desire to have an inquiry which may result in a ten-year plan is a most interesting theme. He mentioned the nationalised industries. Do I understand him to imply that the inquiry would cover the failure and the functions of private enterprise industry?

Sir J. Henderson-Stewart

Yes, Sir. I am trying to be concise, but I will cover that point.

I was saying that I do not share the view that there is adequate capital available now.

Dr. J. Dickson Mabon (Greenock)

Where in this document is that view expressed?

Sir J. Henderson-Stewart

I do not think it is in the document, but I understand that it was the view of some of the leading members of the Scottish Council. I hope I am right. If I am wrong I shall, of course, withdraw. I merely say that I do not take the view that there is adequate capital available for every good new project. My view is that if the five-year or ten-year plan which I have in mind is to have any validity capital will have to be pumped into Scotland to a degree far beyond any figures which have so far been suggested to us.

We shall not be looking merely for a few isolated companies occupying a few small new factories. The plan which we must envisage must cover the introduction of very large co-ordinated enterprises—small ones as well, of course—private enterprise as well as State enterprise. One would hope that some of them would be new, but many would arise out of the integration and development of industries at present located in Scotland, such as the electrical engineering and electronics industries, which have made a limited but notable impact on our national life. But in all this there can be no advance and no prospect of real development in our country unless the development is given strong and continued support by the money market and the National Exchequer.

Who is to draw up this vital blueprint for the future? I feel that there can be only one answer. It has to be the respon- sibility of the Government. I do not mean Government Departments, because they have their hands full enough already. Nor ought it to be done by any of the unofficial bodies now operating in Scotland, worthy as they are. If we are to make a job of this, we must bring fresh minds to the drafting of this great plan and invest the people concerned with the full authority of the State to get on with the business swiftly and efficiently.

With all respect to the Government, I therefore propose the appointment of a Scottish Industrial Commission composed of twelve, fifteen or eighteen of the very ablest men on whom we can lay our hands, men drawn from industry, commerce, transport, the banks and agriculture, not in any representative capacity but for their own qualities as leaders of thought in their own spheres. Such men of experience and high ability are, I suggest, available to us in Scotland today. They await only the call and the opportunity to pool their brains and point the way to a viable future.

Given such a Commission with the necessary facilities and skilled advice, we might hope to see within a reasonable period a well-considered, imaginative, far-reaching plan stretching well into the 'sixties in which all agencies in Scotland—public, private and local authority—might co-operate in a concerted effort to serve their day and generation.

When it emerges, the plan might very well be the subject of controversy; but what of that? Thoughts would have been stimulated, hopes would have been raised, and action would perhaps be taken, and that, after all, is what we are trying to get. I know that this proposal will raise voices of criticism. It will no doubt be condemned as unnecessary, unprecedented and impracticable. There will even be those who will say that it is impossible. I should not wilt under any criticism of that kind.

I ask myself, and I ask the House to consider, what the alternative is to some searching inquiry such as I have suggested. The question that we have to answer is: Are we to go on indefinitely running under capacity in Scotland and risking the livelihoods year by year of great numbers of our fellow countrymen, skilled and unskilled? Have we not had enough experience of this kind of thing to realise that a searching reassessment of our national position is inevitable? If this be so, how can it be done except by the creation of a body with the powers which I have suggested?

I would regard such a Commission as I have outlined as perhaps the most important body of its kind that has ever been appointed in Scotland and having the greatest possible opportunities for good. I commend the idea to my right hon. Friend the Secretary of State with all the earnestness that I can command because I believe that by this means alone are we likely to get an advance in our time.

6.9 p.m.

Mr. J. C. Forman (Glasgow, Springburn)

I should like to deal in the first instance with the question of assistance to the shipbuilding industry. My hon. Friend the Member for Hamilton (Mr. T. Fraser) dealt with the subject, and I believe that my own Member of Parliament, the hon. Member for Glasgow, Scotstoun (Sir J. Hutchison), took certain exception to it. It seems to me that the House has to decide whether it is necessary for Government assistance to be given to the shipbuilding industry, and if it arrives at the conclusion that it is, the important question is not where the assistance should be given but when it should be given.

Last November, my hon. Friend the Member for Glasgow, Govan (Mr. Rankin) raised this question and went a little further than the Government proposed to do, in connection with the Cunard Company. He suggested that Government financial assistance should be given to that shipbuilding firm so that it might build ships, on the understanding that those ships were placed at the disposal of shipping companies. It may well be that the Government would be taking a risk in that way but I believe there are ships that could very reasonably be replaced now. My hon. Friend is to be commended, in that the Government have accepted the suggestion that he made, although at the time he did not get very much support from the Government side. The Government have now decided to give to the Cunard Company financial assistance which will enable it to place an order, I hope at the Clydebank shipyards.

Unemployment in Scotland has been engaging the attention of one of the most important industrial organisations in Britain which takes second place only to the British Trades Union Congress. I refer to the Scottish Trades Union Congress which has within its ranks all the organised workers in Scotland. It held a conference at Dunoon in April when practically the whole of the time of the conference was taken up with delegates discussing the very serious position experienced in their own unions.

At the finish of the conference it was intimated that the Prime Minister would meet a delegation from the Scottish Trades Union Congress and he did meet it. I should like information on this particular point. It would be as well for me to refer to the particular paragraph that the conference had in mind, and it is important to have information on this paragraph in view of the fact that the President of the Board of Trade yesterday stated that a trade agreement had been completed with Russia.

The statement that was made in the official organ of the Scottish Trades Union Congress reads as follows: There was constant criticism by industrial interests that the Export Credits Guarantee Department was unable to provide for long-term credits. This was a great handicap to exporters. In seeking orders in Russia, for instance, some exporters had found it impossible to meet the conditions of the Soviet Central Buying Agency when it sought to provide for exchange of goods for goods or a form of barter. This would be much easier if the Government in this country were able to set up a centralised market agency; and it would be a very helpful gesture. The Co-operative movement in Scotland has a fair amount of experience of trade with Russia. The S.C.W.S. was probably the first organisation to trade with Russia and we have had three trading agreements since then. We know how difficult it is to fix up these trade agreements, but once the trade agreements are fixed up the Russians honour them in their entirety. We are not unmindful of the difficulties that the Government may run into in fixing up a trade agreement. The point that the Scottish Trades Union Congress made to the Prime Minister might be examined. I understand that the Secretary of State for Scotland was present at the meeting. If this point has been examined could we have information about the conclusions reached upon it?

I turn to constituency matters. We are quite well pleased with the strip mill being allocated in Scotland but against the employment than that may create we must place the works that will be required to close down. In my constituency is a firm which has traded all over the world, Messrs. Frederick Braby & Co., Ltd. That firm is having to shut down and 600 men are now unemployed as a consequence of the shutting down of that steel mill. We have Dixons Iron Works which was shut down, while at Beardmore's at Parkhead about 100 men are being paid off and nearly 1,000 men are being put on short time, that is, four days per week. The work that the strip mill may bring to Scotland must therefore be weighed against the amount of unemployment that is being caused by older steel works being closed.

I would ask the Secretary of State for Scotland about the nationalised workshops run by the British Transport Commission and the Gas Council. In the Provan area we have the Provan Chemical Works employing 204 men. By September of this year it may have to pay off 150 of those men, leaving only a skeleton staff in the establishment.

When they were run by the Glasgow Corporation, those works made a profit of about £110,000 a year. I cannot say what the profits are now, but it seems to me that this is a nationalised workshop which is being run down. Twenty-four members of my union, the Amalgamated Engineering Union, are employed in the works. Seven of them are to be retained and seventeen are to be paid off. One hundred and fifty of the semi-skilled men are to be paid off. That is the position in the Provan Chemical Works and I ask the Secretary of State to say whether the work which is now done by that works under the Gas Board is to be handed over to a private firm.

I want now to refer to railway workshops. With some colleagues, I recently met representatives from various railway workshops. Delegate after delegate told us that there was redundancy in those workshops and that the policy of the British Transport Commission seemed to be to denationalise the shops and to allow them to run out of work so that the work could be placed with private firms.

Nationalised workshops should serve the purpose of keeping railway rolling stock modernised, but they should also have a social purpose. It is not the intention of the executives of the unions concerned that the men should be kept on without adequate work for them, but they take the view that under nationalisation the workshops should have sufficient work to give the men reasonable security and to permit long-term planning instead of their present hand-to-mouth existence.

The Minister of Transport was good enough to invite me to go to Swindon. At the railway workshops there, I found that skill and modern methods permitted the production of the diesel trains now running between Queen Street and Waverley Station. The introduction of those trains has resulted in a phenomenal increase in passenger traffic. The craftsmen of those workshops are capable of undertaking the work necessary to modernise the country's transport system.

The hon. Member for Fife, East (Sir J. Henderson-Stewart) suggested that capital available for developing our industries might be limited, but it seems to me that if the Government would stop crying for the moon and would use some of the money spent in that connection for developing our industries, they would do so to the great advantage of the country.

We do not ask that the workshops in my constituency should be modernised to the extent that they all turn out new work, but we are entitled to ask that in the Springburn area at least one workshop should be modernised so that it is capable of turning out the work necessary for the efficient running of British Railways.

It is said that our workshops are not tooled up or modernised to carry through that work, but increasing numbers of orders are handed to private enterprise. It may well be that for the welfare of the industry certain orders should be placed with private enterprise, but I take the view that if the railways were modernised and if the output of diesel locomotives and rolling stock were speeded up, there would be sufficient work for national workshops and to assist private enterprise, if assistance is necessary.

In the Cowlairs Works at Springburn, a complete close down by 1961 is suggested. Nearly 3,000 men, with many years of skill behind them, are to be thrown on the scrap heap. At St. Rollox, about half a mile from Cowlairs Works, a considerable pay-off, if not a close down, is suggested. The unions concerned believe that if the Transport Commission had sufficient funds available, the workshops could be modernised and there would be more work available so that the men could be kept employed.

There is considerable development of electrification in the Glasgow area and the first try-out of electric trains from Glasgow will probably take place at the end of this month. Men in the workshops in my area are confident that they are capable of undertaking the maintenance work required for rolling stock on the routes to be electrified.

I hope that the Secretary of State will look into this question seriously and will try to relieve men's minds of the fear that there is a deliberate policy to denationalise national workshops. I hope that attention will be paid to the matters I have raised and that information on the questions I have put will be forthcoming.

6.30 p.m.

Sir James Hutchison (Glasgow, Scotstoun)

The majority of the speeches which have been made this afternoon have had a strong constituency flavour, and I am neither competent, nor would I care to try, to criticise those things which have been said in that respect. But there were one or two rather more general subjects to which I should like to make reference.

The question of subsidies for shipbuilding has been touched on by a variety of speakers, starting with the hon. Member for Hamilton (Mr. T. Fraser). I want to make it clear that there has never been a subsidy given to the shipbuilding industry, and, so far as I am aware—and I am a shipbuilder—no member of the shipbuilding industry is asking for a subsidy now. It is true that a certain amount of limited assistance, which was repaid, was given to some shipowners to enable them to modernise their fleets, but that is not a subsidy to the shipbuilding industry. One might as well say that because a free dental service is available to people in this country, the manufacturers of sweets are being subsidised. [HON. MEMBERS: Oh.] I agree that I have extended the simile a little far, but it is still not accurate to say that the shipbuilding industry has had or is anxious to have a subsidy paid to it at the present time. Of course, circumstances may change; the industry may change its mind, but that is the position as it is at the moment.

Mr. Rankin

The hon. Gentleman is employing the word "subsidy" and disputing the sense in which it was used on this side of the Committee and is used generally. Would he give us his definition of "subsidy"?

Sir J. Hutchison

I do not wish to give a definition of what I mean by a subsidy to the shipbuilding industry because we are not asking for one. It could take a dozen forms, but we do not want one.

The other point on which I want to touch is the question of the position of advance factories, the distribution of industry and the attraction of industries to my country. I am as anxious as anybody else that this should take place. The diversification of industry is extremely important, but hon. Members must really judge this matter in balance and in perspective, because if it is made so attractive for industries to come to Scotland there is a risk—I do not put it any higher—that it may destroy or prejudice the industries which are already there. That does not affect the argument in favour of it, but I would plead with my right hon. Friend to bear in mind that when attracting new industries to Scotland it is necessary to take care that at the same time we do not kill an industry which is already there.

I should like, in following this aspect of the story, to congratulate my right hon. Friend the Secretary of State on the successful battle which he put up for the steel strip mill, and I think that in this general policy—

Mr. Bence

I may be wrong, but I thought I heard the hon. Gentleman congratulate his right hon. Friend on the great battle which he had put up for the strip mill. If my memory serves me right, a great battle was put up for the strip mill by this side of the Committee and by the Scottish T.U.C.

Sir J. Hutchison

I do not think I need comment on that remark. Of course, I should like to be fair; hon. Members opposite did muscle in—

Mr. Ross rose—

Sir J. Hutchison

They came in with us and we both went together, but the ultimate credit must be given to those who had to contend with the Government and fight the battle in the Cabinet.

Mr. Douglas Johnston (Paisley)

The hon. Gentleman's ground for congratulating the Secretary of State is, I understand, that he fought a battle in the Cabinet for a strip mill in Scotland. How does the hon. Member know that? I always understood that what happened in the Cabinet was secret.

Sir J. Hutchison

We would not have got the strip mill unless a battle had been fought, and anybody who had his eyes open must know that the battle was going on. Indeed, hon. Members on the benches opposite claim that they took part in it.

Perhaps I may go on. The D.A.T.A.C. system has, in fact, done better for Scotland than. I gather from their speeches, hon. Members opposite are prepared to give credit for. In 1958, for example—and paragraph 25 of the White Paper shows this—certificates were issued under the D.A.T.A.C. system in Scotland for almost the same number of enterprises as in 1957, whereas in the rest of the United Kingdom the issue of certificates fell grievously. That is not to say that it is a supreme success, but it does show that Scotland got a higher proportion in 1958 than did the rest of the country, comparing the result with 1957.

I want to turn to a completely different theme, and that is the danger to Scotland which may arise from the failure of the Free Trade Area and the setting up of the Common Market. Until recently those enterprises of the kind that we have been trying to attract to Scotland, and have in large measure succeeded in attracting, if they were to establish themselves abroad, could establish themselves in Britain and have the advantage of our Imperial Preference system and be at no special disadvantage in exporting to Europe. But with the setting up of the Common Market they have to look at the situation afresh, because if they set up in Europe they have the advantage of a consuming population in the six countries, which form the Common Market, of about 150 million people. They now have, they fore, to choose between setting up here or in the Common Market countries, and the Common Market countries are making it extremely attractive for them to go there and are offering them all sorts of inducements which, I suggest, we may have to follow. They can set up there and endeavour to sell their goods to this consuming population of 150 million, or ignore it, and come here and suffer the disadvantages of tariffs and have the dwindling preferences which we have with our Commonwealth.

That is having a big effect. It is having this effect, that certain American concerns which looked likely to allow the manufacture in this country and in Scotland of certain of their patents and processes under royalties, are starting to refuse that facility. Until recently there were something like twenty projects being examined in the North American continent for enterprises to come to Scotland, and out of those twenty only one has materialised. I do not go so far as to say that the other nineteen have been lost, but they seem much more attracted to countries like Holland and other Common Market countries than they were before and probably than they will be to Scotland.

Therefore, I think that two things have got to be done. The Government have got to examine what inducements are being given by the Dutch and other Governments to attract these industries into the Common Market countries; we must weigh carefully whether we have not got to go just as far, and perhaps further, in trying to attract those industries to Scotland. Also, it shows the importance of a theme I have urged on other occasions. There should be a Commonwealth Conference held to find out just where we stand with our Commonwealth in the situation which is now developing. It may be that we shall have to revise the whole of our Imperial Preference system. It may be that we shall have to criticise the quota system which Commonwealth countries are imposing on us with such strictness today.

I come now to another general theme which concerns a problem which may well arise and which, as I shall try to show, may well hurt Scotland. The House will remember that, when we discussed the Restrictive Trade Practices Act, we decided that it would be wise and good to provide for legislation to prevent harmful restrictions damaging to the public interest. A court was set up, which has been functioning for some time, before which restrictive practices or agreements between concerns would have to be defended. This process has been going on.

Some of the recent judgments of the court have been very remarkable, and they may have a profound effect on industry in general. The court has decided that not only must the defenders of agreements show that they were doing no harm to the public—which it is possible sometimes to do—but they must go further and show that they were doing positive good and that the agreements should be allowed to continue. This is virtually an impossibility.

Dr. Dickson Mabon

Hear, hear.

Sir J. Hutchison

It is virtually impossible in those circumstances to prove that one is bringing a definite benefit to the public by some agreement which has been made. I do not think that, when the legislation went through the House, either side thought that it was wise or desirable to introduce legislation which would go further than the prevention of harm. If this legislation is not looked at again, a certain consequence, it seems to me, will inevitably flow from the judgments of the court. That difficulty can be overcome by no longer having an agreement. Six companies, let us say, which previously had such an agreement need only amalgamate into one concern, or the biggest of them can buy over the others, and the difficulty is avoided. The Restrictive Trade Practices Act will no longer apply, but the companies will be able to achieve the same result if they so wish. There is thus an inducement towards the building up of large combines, which I myself regard as undesirable, and which will have a most unfortunate effect upon Scotland, as I shall try to demonstrate.

If the House has followed me in the argument so far, it will realise that the tendency will be towards amalgamations. I contend that Scotland will come badly out of such amalgamations. The size of the population and the power of the wealth centred in the South means that, in any amalgamation, the smallest and least influential part of any combine will probably be in Scotland. If there is a period of recession, a thing which we have already seen, though perhaps not in acute form, there will be a great temptation in a combine of this kind to cut off the smallest part of its organisation. In the same way a large concern in England which has set up branches in Scotland may well decide to close the branch in Scotland, if there is a recession, and carry on in England. I believe that this tendency towards the building up of large combines may well follow from the curious judgments of the court, and it is something which Scotland ought very closely to watch. It can do Scotland great harm.

I want to say a word now about shipbuilding and what has been done in shipbuilding. The subject was introduced rather unsuitably, and certainly inaccurately, by the right hon. Member for East Stirlingshire (Mr. Woodburn) when we were discussing tourism. I do not know where he got his information from when he said that the yards in Scotland have not been kept up to date. I do not know from what jaundiced source that idea came.

Mr. Woodburn

I will tell the hon. Gentleman. If he reads the book which Mr. Andrew Shonfield, the economic adviser to the Observer, wrote on Britain's shipping since the war, he will see there a very detailed account of how the Japanese and even the German shipyards have modernised themselves—they had the opportunity, since they were in ruins—and how they are much ahead of British shipyards. He shows that many parts of the British shipyards have not been modernised and old methods are still used.

Sir J. Hutchison

I know Mr. Shonfield and I think that he knows quite a lot about industry, but I do not accept him as a final arbiter in a matter of this kind. When a country has been knocked about as Germany and Japan were, and as Rotterdam was, they have, so to speak, a flying start which enables them to introduce the most modern layout and machinery. It is not open to others to emulate them unless they put their own yards into almost the same destroyed condition. If one is prepared to start ab initio, then one can do a great deal in modernisation which it is sometimes very difficult to do without starting ab initio.

Mr. Woodburn

Is the hon. Gentleman now prepared to withdraw the adjective "jaundiced" in his description of what was obviously a genuine opinion on the part of Mr. Shonfield, and probably a very well informed one?

Sir J. Hutchison

I do not know whether Mr. Shonfield has had jaundice or not, but I am not prepared to withdraw it. I think that it is merited in view of what I propose now to read to the right hon. Gentleman from other sources. I will tell him of some of the things which have taken place in modernisation. There has been tremendous development in the system of welding and in building welded ships. Large sections of a ship are now prefabricated and pieced together in building a ship in a way which was never known before the war. New machines for cold frame and plate bending have been invented and installed. The new free piston type of engine has been invented and used, and engines are being supercharged. We are well on the way, I think, to finding an engine powered by nuclear propulsion. The list could go on a long way. Almost every yard on the Clyde has a modernisation plan at the present time.

Because I am a shipbuilder and there are four shipbuilding yards in my constituency, I may be thought biased. I will quote from other authorities. In the White Paper, for example in paragraph 80 it is said: Considerable progress was made with modernisation and reconstruction schemes at various yards. In the survey by the Clydesdale and North of Scotland Bank, Ltd., on page 20, it is said: British shipbuilders have spent substantial sums in post-war years in modernising their yards to enable them to adopt the most up-to-date techniques and build the largest ships which are likely to be ordered, and further development schemes are in hand or projected, in Scotland as in other parts of the country. I am prepared to set those two authorities against Mr. Shonfield, although I do respect his opinions from time to time.

Dr. Dickson Mabon

Since the hon. Gentleman is being objective in this matter, will he admit that many of the modernisations have come rather late in the day? They would have been very welcome at least five years ago, anyway. We are very happy about developments in nuclear propulsion, although we have not yet placed our orders for what is to be done in Britain, but surely this development is entirely due to the Admiralty Committee and Government finance?

Sir J. Hutchison

Not at all. The development of the nuclear propulsion engine has been a co-operative endeavour, with sums of money and individuals being devoted by the shipbuilding industry in Scotland to research into how it can be done. My own company was invited to send someone.

Mr. Rankin

Will the hon. Gentleman agree that the one nuclear propulsion unit which is now in existence and able to go into a steamship and drive it is the product of research work at Fairfield Shipbuilding Yard in my division in association with Mitchell of Yorkshire?

Mr. Bence rose—

Sir J. Hutchison

I will leave it to the two hon. Gentlemen to argue it. I really cannot give way any more. I have already done so a great deal, with the result that I have taken longer than I wished.

I want to end by asking my right hon. Friend a few questions about atomic energy. I think that we have made a good start, and that my right hon. Friend and his predecessor deserve our congratulations. Scotland was left behind in the aircraft and motor industries and we have never caught up, but here I think that we are in the van. I hope that the progress that we have made in connection with Chapelcross, Hunterston and Dounreay will be kept up. I should like my right hon. Friend to tell us a bit more about Dounreay. Has Dounreay been a success? Paragraph 168 of the White Paper tells us a little about this matter. It says that the materials testing reactor has become operative, that the fast reactor has gone into commission and that the plant for manufacturing fuel elements is in operation. Is this up to programme? Are we obtaining the results which were honed for and what effect will this have in general on British nuclear production? I believe that not only Britain's prosperity but Scotland's prosperity depends on our keeping in the van in this important matter.

6.51 p.m.

Mr. William Hamilton (Fife, West)

I am glad to be able to follow the hon Member for Glasgow, Scotstoun (Sir J. Hutchison) because he made one or two points which I should like to challenge. I hope that I will not be interrupted as much as he was.

The hon. Member began by congratulating his right hon. Friend the Secretary of State for Scotland on fighting in the Cabinet for the steel strip mill. I wonder who the right hon. Gentleman fought in the Cabinet? I suspect that the right hon. Gentleman also had to fight some of his own back bench Members from Scotland. There is one hon. Member sitting on the opposite side of the Chamber now who made a vehement attack on the idea of a steel strip mill in Scotland. I do not think that I shall give any secrets away by saying that I remember a meeting of the Scottish Labour Group upstairs when we discussed the question of a deputation to the Prime Minister and wondered whether we could drag in hon. Members opposite, led by the late Walter Elliot.

Mr. Ross

Walter Elliot came.

Mr. Hamilton

Yes. We discussed whether we could persuade hon. Members opposite to go along with us. It is well known that the Scottish T.U.C. was the motivating force behind this venture. I ask the hon. Gentleman, "Who is providing the money for this steel strip mill? Is it a subsidy, a grant, a loan or what?" I will tell the hon. Gentleman: it is Government finance.

This is the theme which my hon. Friend the Member for Hamilton (Mr. T. Fraser) quite rightly adopted. The issue between the two sides of the House is how we are to get the Scottish economy on a reasonably sound basis. Whatever else may come out of this debate, it is clear that it is of paramount importance that unless there is increased public investment and assistance in private enterprise the Scottish economy will collapse.

I recommend hon. Members to read an article in yesterday's Glasgow Evening Times which is headed: Loans to help these Scots industries can go too far. The article reads: In recent months there has been a growing tendency for the State to advance money to private industry. Four examples may be quoted. There is the subsidy of about £30 million which is to be given to the cotton industry to enable it to scrap obsolete machinery and modernise itself"— funeral expenses; that is what it amounts to. There is the talk of a Government loan or grant to Cunard to enable it to replace the two Queens on the Atlantic run. There was the £50 million long-term loan to Colvilles to finance the building of a steel strip mill in Scotland. And finally there was the loan to the North British Locomotive works in Glasgow to enable it to complete the switch-over from making steam locos for the British Transport Commission to making diesels. Cunard can claim that the tax system prevents it from accumulating the vast sums needed to replace transatlantic liners like the Queen Mary and Queen Elizabeth, and that these liners contribute to Britain's international prestige as well as to Cunard's own profits. On the other hand, Cunard could presumably try to raise the money on the Stock Exchange or from private sources. But no—it must be done by State finance.

This point is underlined, not by a Transport House publication, but by the Annual Report of the Clydesdale and North of Scotland Bank Limited. Page 7 of the Report reads: 1958 has been a disappointing year; the experience of Scotland has been that a combination of world recession and disinflationary policies has impinged on the economy with comparatively greater severity than on that of Great Britain as a whole. Later, the Report states: Any improvement in employment prospects in the immediate future is likely to depend largely on an increase in investment expenditure by the customers of heavy industry located in Scotland … I want to emphasise the following words— '… on Government-sponsored investment in factories and houses, and on the provision of other services and amenities. It is not easy to feel confident that industry will even sustain its present rate of investment in the coming months, and since capital equipment is at present generally under-employed it cannot be assumed that an increase in demand for consumption goods will soon give rise to greater investment. It is thus difficult to see any alternative in present circumstances to Government finance and promotion of investment Unless and until there is an increase in public investment and public finance—call it subsidy, bribery, seduction, or what we will, it is Government help to private industry—industry will not come to Scotland. So long as only the profit motive operates industry will not come to Scotland of its own volition. Industry is labouring under so many natural disadvantages that the State must cajole, encourage, persuade and bribe it to come to Scotland.

It follows that if the State provides money it must have some control over it. This is the basic philosophical and ideological difference between the two sides of the House. The Government are prepared to advance State money but are not prepared to impose the control which should go with it. They are prepared to give the money without any questions being asked. If a local authority wants money to build houses—social investment—it cannot go to the Public Works Loan Board unless and until it has tried the market. But this does not apply to Cunard, as the article in the Glasgow Evening Times points out. Cunard does not have to try the money market before it gets the necessary finance; it goes to the Government.

Why is there this difference between the two sides? I am glad that my hon. Friend the Member for Hamilton pinpointed the issue. We all know the basic problems in Scotland, and we need not waste time in repeating them ad nauseam. The basic point that I wish to make is the one which was made by my hon. Friend in much more eloquent terms than I could make it.

I want to mention a constituency point. As the right hon. Gentleman knows, there is an Admiralty establishment—another nationalised concern—in my division, namely, the Royal Naval Aircraft Repair Yard in Donibristle, which is scheduled for closure in a few months. No application has been made for using it to date. I received a letter this morning—I will send it to the right hon. Gentleman, but I want to get it on record—which indicates the kind of difficulty that there is in this matter and I hope that the right hon. Gentleman will give it the treatment which I think it deserves. The letter is from a firm of solicitors whose client has been to them about the possible use of the aircraft yard. This is what they say: We have a client who has business interests within your constituency and who has been pursuing an interest in the Aircraft Yard, etc., at Donibristle, which, as you know, is scheduled to be closed down in August. The venture which he has in mind would be a development along lines something new to Scotland although apparently now firmly established on the other side of the Atlantic. There are certain difficulties particularly in relation to (a) the fact that even with the yard, etc., considerable capital expenditure would be involved before any results could be shown. (b) The Admiralty are apparently disinclined to lease and more in favour of a sale: the capital expenditure on purchase would be really heavy and would complicate the availability of capital for the subsequent adaptation. One query that arises in this respect is whether in the event of the Admiralty absolutely declining to lease, the price could be spread over a period of years. (c) One of the primary concerns appears to be the extent of the labour force which will he required by anyone taking over the yard. The project which our client has in mind would probably not require more than around 200 people by the end of the first year of production but it could reasonably be said that the potential demand thereafter could be quite substantial, but, of course, while our client so naturally very confident, there can be no real guarantee of unqualified success with a new venture. I will send on this letter to the Secretary of State. I hope that he will take it up with the Admiralty and that we can get a tenant for the yard. I can tell the Secretary of State that in recent weeks, the announcement that the closure is to be speeded up somewhat has caused a good deal of anxiety locally; and whilst there has been no redundancy so far, it may well arise as a result of the decision to speed up the closure.

That is all I have to say. The debate has been extremely worth while if it has pinpointed and emphasised the basic difference between the two sides. If we fight the General Election on that, we will sweep the board in Scotland.

7.3 p.m.

Sir David Robertson (Caithness and Sutherland)

I have always regarded this annual debate as one of greater concern to the big cities, where there are large numbers of people and where, when unemployment comes, as it has done in the last year or so, there is a severe problem indeed. On this occasion, however, since the eastern half of my constituency had a rate of unemployment of over 20 per cent. in January and, although there has been an improvement, it is still running at a high rate, I feel obliged to raise the matter again now.

My hon. Friend the Member for Glasgow, Scotstoun (Sir J. Hutchison), in his interesting speech, spoke of the difficulties of killing existing industry by subsidising or assisting new industry to come. We are running no risks of that kind in Caithness and Sutherland. We have no light industry. We have one tremendous boon and that is Dounreay, which came to us mainly through the efforts of the Government and for which I shall be eternally grateful.

One of the most interesting features of that is to see how the children of the farmer, the crofter and the fishermen are adapting themselves and taking to industry like ducks to water. There are about a thousand of them there already, working on full-time life engagements so long as they behave themselves, with superannuation, good holidays and conditions such as we have never had before in Caithness.

My wife and I had the honour of attending a demonstration of apprentices at Dounreay on Thursday of last week, when about 25 or 30 of these fellows were about half way through their course. They put up a wonderful display in productions which they had made and for which prizes were awarded and in their skill in physical training. That has not been neglected while they have been training. It was a source of tremendous satisfaction to me to see these young men, all of whom, with I think one exception, came from the northern counties, being trained in the highest arts and skills of engineering. I was assured that when they pass out, there will be no apprentices trained anywhere in Scotland to a more advanced state. That is remarkable and welcome in an area from which we have had to send our children to Glasgow and the ends of the earth to get training in anything other than farming and fishing.

My hon. Friend the Member for Scotstoun called upon the Secretary of State to give a brief report of how Dounreay was progressing. That is not the responsibility of my right hon. Friend the Secretary of State, but he will, I know, be pleased to do what he can. As for the benefits to the North of Scotland, let there be no doubt in anyone's mind that Dounreay is a great success. One of the reasons why the plant was located there was to provide industry in an area where depopulation and unemployment had been our lot for over a century. It certainly has made a tremendous contribution to the economic well-being. I am told that the Admiralty reactor which was to be built with the idea of providing the first propulsion unit for a submarine—Vickers are doing the work in conjunction with the Government—has to some extent been retarded because of the progress that has been made in the United States with atomic-propelled submarines.

I said that depopulation had been our lot. Sunderland is the most depopulated county on the mainland of Britain. It has gone down by 50 per cent. in the last century, while the population of Scotland has almost doubled and the population of Great Britain has doubled. Caithness is the second most depopulated county. One last word about Dounreay is that Thurso has been transformed. From a decaying, dying town with a population of less than 2,500, it now has a population of about 6,000 and one sees masses of babies and new perambulators in the streets, which is something one did not see a few years ago.

I have been living with these problems of getting a share of light industry into the old Higland towns, particularly in my own area, but anywhere in the Highlands. I have not been parochial in that regard. I felt that anything which could be done for Inverness would be of great benefit to the North and I have tried to encourage the Board of Trade, which is responsible for industry throughout Great Britain, to do something to attract industry. I tried very hard in the days when there was little or no unemployment in Scotland, from 1948 until two years ago, when there were much greater opportunities for development if there had been the will to develop. I tried by my own efforts to stimulate enterprise, but no help came from the Government apart from Dounreay.

In March a little over two years ago, I had the good fortune in the Ballot to bring in a Private Member's Bill and I brought in a small Bill entitled the North of Scotland Development Corporation Bill. I modelled it on the great success achieved in Northern Ireland. I asked the President of the Board of Trade to select between four and ten highly-skilled industrialists to direct an executive of two men, a manager and an assistant manager, with a couple of girl secretaries, in two rooms in Bothwell Street or some other place in Glasgow. The Bill was supported by all Highland Members and by the late Walter Elliot. We had a good, short debate. I think that had a vote been taken that day, the Bill would have succeeded in getting through, but, unfortunately, it was talked out.

In that Bill, I praised the Government for all that they and their predecessors, right back to the Coalition Government, had done to improve the conditions of the Highlands from what they were in 1939. Nobody can challenge that. Great progress has been made in agriculture. We cannot, however, continue to hold our people unless we have some alternative industry to agriculture, fishing and forestry. Forestry, incidentally, has been one of our failures. It is lamentable, but I am afraid we have made very little progress at all.

However, the matter I want chiefly to talk about tonight is the attraction of industry. A few days before the debate on my Bill took place I asked the President of the Board of Trade a Question. I asked how many factories had been created since the Distribution of Industry Act had been applied to the Highlands by the right hon. Gentleman the Member for East Stirlingshire (Mr. Woodburn) in 1949? I was speaking in 1957. The Answer was that eight factories had been opened in the Highland area, most, if not all, of them by private enterprise, and they were employing 770 people.

It did not seem to me to be much of a contribution to solving the problems of depopulation and unemployment in an area over one-third, and just under one-half, of Scotland. To employ another 770 people did not seem to me much of a contribution.

In January this year, only two years after my Bill was rejected, I put down another Question to the President of the Board of Trade. He had said that my Bill was not necessary, that there was no need for it, that there were plenty of organisations doing the job which I wanted the development board I proposed to do. Of course, they were not doing the job. They were only talking about doing the job. The Answer I got in January was that since March, 1957, up to the present six new factories had been started, and two extensions, employing a total of 121 people.

That would not have much effect on depopulation or unemployment, and at that date we were running at 20 per cent. unemployment in the whole of the eastern half of my constituency. There were 20 men and 20 women out of every 100 out of work. Add to them the children dependent upon them and that is a very large number of people. One Member said that, in numbers, they did not amount to much. I tell him that they amount to 2,000 people, and that is a lot of people in the depopulated North.

I said a little earlier that for the development corporation I proposed I took as a model the Northern Ireland Development Corporation. That has been the most astounding success of any similar undertaking I know of, and the Government deserve the greatest possible credit for the efforts they have made in conjunction with the Government of Northern Ireland in introducing 130 great factories there. Maybe the previous Government had something to do with this. I imagine they must have had. If so, they are entitled to credit, too.

I have been reading Sir Francis Evans's interesting contribution to the Spectator recently, wherein he tells the story of how 37,000 new jobs have been found; not 121 plus 770; 37,000 new jobs, and there is a potential, almost in a year or so, of 14,000 more. That would be 51,000 new jobs. There is still an unemployment rate of 8 per cent. in Northern Ireland, but the Government have something to be proud of in what they have done there and, maybe, the previous Government, too, in bringing these arrangements together. The article I referred to reveals that the whole community backed the efforts of the Northern Ireland Government and backed the efforts of the British Government.

I would not grudge anything going to the North of Ireland, nor would any Member, I think. They are a fine people, and they are very closely related by descent to us in Scotland, but I wonder why it is that the same Government have done so little in the Highland counties of Scotland.

Take a town like Wick. It has every conceivable public service, and good labour; gas, electricity, housing, roads, an aerodrome, a harbour. It presents a much easier problem than many places in Northern Ireland. There is no sea barrier. Like Invergordon, Dingwall, Inverness, Fort William it has no sea barrier, but is on the mainland, with a main line railway and road transport.

Yet we in Scotland are being played down. Is that denied? How can our position be as it is in contrast with Northern Ireland? I am reluctant to suggest this, but what other explanation can there be? Is it to prevent competition with Northern Ireland? Was it to prevent competition? It looks very much like it to me, because of the abject failure in the Highland counties compared with the magical success in Northern Ireland. It calls for an explanation. I think the people of Scotland will want it. I certainly want it as the Member responsible for the two most depopulated counties.

The situation in Scotland is agonising to me. I took two meetings on unemployment in October when things were at their worst, or almost so. They were fine fellows, all anxious to get work, but there was no work for them. I saw the authorities at Dounreay. They have done very well indeed in trying to take everyone they possible can, including the deaf and dumb, which is a tremendous thing, and it is of great credit to them. They are doing what they can. Others have been absorbed by contractors in the normal way in these transitional contracting jobs as they come along on hydro schemes and so on, but they are not lasting. We are able to take some of the light industrial jobs which the people in Kilmarnock do. Why should we not be given a share? Six of them would transform Wick, transform a place almost of despair to one of great happiness, surging forward and playing its part.

We have made an awful mess of Scotland, with 70 per cent. of our people crowded into the industrial belt of Glasgow and the Lanarkshire towns and Edinburgh. Is it not about time we set about putting our own house in order?

That is why I became an Independent. I could not stand it any longer. I even took over a mine which the Government of the day or the National Coal Board had scheduled for closure. It made a profit last year. It made a small profit in the one before, not one to boast about, because it has low-grade coal. Nevertheless, we pay the full wages which the National Coal Board would do. I do not expect other people to go into heavy industry like the one with which I am connected, where we mine deep-mine coal and make brickettes and ovoids. We make bricks which are heavy to cart around. There is an average of fifty miles before the product gets to its destination.

When the hon. Member for Dumfries (Mr. N. Macpherson) wound up the debate two years ago, I had been asking for action, and he said he was going to see I got it. I wonder what he feels like tonight. Does he think my Bill was cowardly talked out in view of what has happened since? There has been action—the only factory in Wick, among the first eight, has been closed down, the herring oil plant.

There has been no action. There has been only the suggestion that there would be action. Nothing would give me greater pleasure than to come back into the fold of the party with which I have been connected since I was a schoolboy, but I would be a traitor to the people who elected me if I stood for any more of this.

I have never asked for industry in the glen. I do not believe in it. I believe in industry where public services are available. Why should we not get it? I would come back gladly into the fold. No one likes being an Independent. It is not a very happy situation in which to be. I see an hon. Member opposite smiling. Believe me, I could keep on being an Independent for twenty years if I had to. There would be no difficulty for me in doing that. I should still remain a Conservative but I should be sorry because of the kind of administration we had got in Scotland.

I support the Government in foreign affairs and in domestic matters generally. It is in Scotland where I find them at fault. The Board of Trade is the principal offender. It is the Board of Trade which has responsibility for industrial matters. There is no drive, no interest. There is only a playing down.

I heard my hon. friend the Member for Fife, East (Sir J. Henderson-Stewart) talking today about getting another committee together to talk with local councils and county councils. Where would that get us? The answer to that is just another talking machine with a lot of lesser talking machines. The Board of Trade must know the problem. The President's writ runs throughout the country. The Secretary of State for Scotland, of course, has no responsibility for this and I am certain that he would support my views, but it would be more effective if he supported them in the Cabinet or wherever these views ought to be expressed.

The situation is not good enough, and it can be put right. There is no question of killing industries. They simply do not exist. It would be manna from heaven if they were to come to these areas. If it is the Northern Ireland type of machinery that will get them there, then let us have that machinery. If not, let my suggestion be adopted and a few people employed to woo industry to the North. I know the six counties of Northern Ireland as well as I know the seven crafting counties of Scotland. If it can be done in Northern Ireland, it can be done in Scotland. I hope that the House will help me to bring that about.

7.22 p.m.

Mr. Malcolm MacMillan (Western Isles)

There was only one mistake in the speech of the hon. Member for Caithness and Sutherland (Sir D. Robertson), and that was when he spoke about his own period of independence. I should like to pay the tribute to him that he was independent a long time before he became officially so. We are only sorry on this side of the House that once again he may renew his plight and troth to the Tory Party. We have welcomed the qualities of independence which he has displayed in the House on previous occasions before his official declaration of independence, and we would have welcomed him personally, too, on this side of the House.

The hon. Gentleman certainly spoke for the Highlands, in particular, and for Scotland more broadly than did the hon. Member for Glasgow, Scotstoun (Sir J. Hutchison), who spent the first part of his speech denying that private enterprise today in Scotland is living on public assistance, which, of course, it is. I do not see why a member of the Tory Party should be particularly ashamed of that. The Tories have never been committed, as were the Liberals once upon a time, to laissez faire. They did not hesitate, in theory at least, to call in the State when necessary to support and give subventions to an industry in difficulties. I am not so sure that there is anything particularly wrong with a private enterprise, if it thinks it can continue to function and function more efficiently, doing so with assistance from the State. Let the Tories be quite honest about it. They have never been theoretically against it at any time, and I do not see why they should dissociate themselves from some of the things which have been said from this side today.

Mr. Lawson

They have fought the last two General Elections on the issue of setting the people free, and presumably it was on private enterprise that they based their hopes for that.

Mr. MacMillan

That may be, but they were certainly not fighting an election on the basis of making themselves completely free of public assistance; and that assistance goes on. Particularly in the Highlands and Islands, we have had examples over the years of the almost universal failure of private enterprise and private industry. The hon. Member for Caithness and Sutherland, by his own practical, shining example of enterprise, by investing in the Highlands, employing people and risking his own capital there, has condemned the rest of the capitalists, because hardly any private enterprise showed its nose in the Highlands even when we had the area declared a Development Area. Development Area facilities were made available for several years, but hardly anybody showed up and finally it was decided to de-schedule the area. There was no live spark of private enterprise in the area itself. No Scottish capital came from Glasgow or any of the other sources of investment; and what capital there was in the Highland towns themselves was not anxious to take a risk and invest in its own area.

The hon. Member for Scotstoun praised the results of Government policy under the Distribution of Industry Act, 1958. He patted the Government on the back for having created jobs and for having shown generosity in assisting industry in all of Scotland. But, when I obtained figures on 7th May from the Board of Trade, I was told that Seventy-four … applications for assistance under this Act have been received from Scotland. Of these, eighteen have so far been approved and six rejected. The total amount of loans approved is £683,270 and of annual grants £7,750."—[OFFICIAL REPORT, 7th May, 1959; Vol. 605, c. 61.] As for annual grants, there was the same answer in respect of a Question about the amount of grants which had gone into the Highlands; so that the total of £7,750 in grants approved by D.A.T.A.C. under the Distribution of Industry Act went entirely to the Highland areas. This means that no grant at all, by 14th May, had come to any other part of Scotland.

It is not a particularly generous record of assistance in or outside the Highland counties. The total of £683,270 in loans was not at all a generous figure. Moreover, the total sum for the seven Highland counties, including Caithness and Sutherland, was only roughly £89,000. We shall not get very far with figures of that kind. I shall come back later to a specific example of what a fraudulent piece of propaganda were the speeches which commended that Act to the House, and to the effect of the Act in the Islands since that date.

When the Parliamentary Secretary to the Ministry of Labour opened the debate today, he was very modest about recent improvements in employment in Scotland. He accepted that seasonal factors had helped and that the good weather had provided most of the jobs. His honesty and modesty were merely realistic; because there are still pockets of unemployment in Scotland which are a disgrace to any Government fourteen years after the end of the war. The hon. Member for Caithness and Sutherland mentioned an unemployment figure of 20 per cent in certain areas of Sutherland. I am glad to inform the hon. Member that in my constituency unemployment has gone down in recent months by 10 per cent. But, it is now 28 per cent., a figure below which it has hardly fallen during the past year, despite the Distribution of Industry Act, 1958, under the policies of the present Government.

We cannot now, fourteen years afterwards, blame the war or anything the Labour Government did. We have had years of "busting prosperity", so we are told. We have had any amount of evidence of it in certain areas, but certainly not in the Highlands and Islands where, if it were not for Government aid over the past decades, we should have been in a much worse condition today. Unfortunately, that action has not been taken on a sufficient scale, with the result that we still have pockets of unemployment of this kind, and particularly urban pockets; though there is much concealed unemployment in the rural areas. It is there in every village, in dozens and scores, and it adds up to the miseries of thousands of human beings in the rural parts just as it does in the cities and in the mining areas.

In the present high season of employment in the Western Isles, we still have 28 per cent. unemployment. I fail to see where the Scottish Office can possibly find a source of self-congratulation in that. Therefore, I commend to the Under-Secretary of State for Scotland the same modesty as was displayed by the Parliamentary Secretary to the Ministry of Labour. It was very much in order and justified by the state of the Government's record. As other hon. Members who represent Highland areas know, we do not include in the unemployment figure the unemployment and underemployment of classes of the so-called self-employed. In Lewis alone, there are between 1,000 and 1,200 weavers, not one of whom is registered for Unemployment Benefit. They are like any other employed, working men; but they are classified in the statistics as self-employed.

The same applies to crofters. Everybody knows that no crofter makes his livelihood from his croft alone. The Crofters Commission, a specialist body, was set up to deal with this problem. If so far, it has had only limited success, we must recall that it has hardly as yet had the opportunity of justifying its existence. The Crofters Commission has stated repeatedly that the crofters must largely depend upon ancillary employment and upon income other than that which they get from the croft if they are to continue to live in the Highland Crofting areas. That in itself shows that there is a considerable amount of underemployment in the purely crofting areas, where other work is lacking. It also shows that the crofter should not be classified as self-employed merely because he is attached to a croft from which he cannot make a living. He has to depend on other jobs, and he is not getting them. Yet he is not classed as unemployed and does not receive unemployment insurance benefit any more than does the weaver in the same area when de facto unemployed.

If all these figures were added together, if the real unemployment figures were seen, it would appal this House. Yet figures of 20 per cent. and 28 per cent. unemployment must surely in themselves have some impact upon the Government and upon the consciences of hon. Members representing other areas as well as upon those of us most directly concerned with the Highland communities.

The hon. Member for Caithness and Sutherland referred to the drift of population which is going on all the time from the small Highlands and Islands villages. The people go hopefully into the towns where they think they will get jobs, and so more and more of the small places are reaching the point of no return and are dying. Finally, these people becoming disillusioned in the towns are drifting south again. I will say this for the days of the Labour Government, that by 1950 we saw for the first time in generations a halting of the drift of population from the Highlands. Population was at least static for a while and there was new hope. Since then the curve has gone down again and unemployment, the lack of prospects and general disenchantment with the situation has started the drift of population from the Highlands again. Today I believe it is only increasing longevity, partly as a result of the social security improvements made from 1945 onwards, which has stabilised and is sustaining the population figures of the Highlands at all. In other words, if it were not for the old people living longer we should see far more dramatically the fall in younger population in that area.

As far as I can see, there is no prospect of improvement without Government aid, and vigorous direct Government aid, to new industries. There is little or no sign that private industry wants to go into areas where it has to meet the problem of long-haul costly transport and lack of adequate communication and basic services. Who can blame private industrialists for not wanting to go to these areas when they can get unemployed skilled labour laid on in the traditional industrial areas where there are good communications and where the sources of raw materials are near, as well as their markets? How can we expect private industry to go to the Highlands? They tell us that, as a matter of sheer business commonsense, they will not do so.

What, then, are we to do? Are we to abandon these areas, or are the Government prepared to take action? Are they prepared to give compensation to those firms who are willing to go or might be directed to go to those areas? There surely remains some responsibility upon the Government and the community to ensure that industry is taken to those places, and the population retained. I know it is the official policy of the Government to retain the population in the Highlands; but there is no sign that it is being carried out. Along with the lack of prospect of new industry, there seems to be no prospect of the revival of old industries like the herring fishing of Barra, or of the expansion of existing ones. I have already explained how much—or how little—is being done under the Distribution of Industry Act, and I am afraid that so far it is a derisory contribution. It is true that D.A.T.A.C. has only been running for a year; but the result has been very small so far in terms of employment or of new industry.

The Government have now turned desperately to tourism. Almost every speech we hear from Scottish Ministers these days tells the crofters to take in tourists. How can we have a tourist drive without proper roads over which the tourists can drive their cars or be transported? How can we provide tourist chalets, about which we have been hearing, without water supplies, electricity, sewerage schemes and modern sanitation? Again there is a direct responsibility upon the Government, and I call upon them to do something urgently to make possible and effective the development of the one industry which they themselves have been concentrating upon for several months past.

One thing the Government refused to do only two weeks ago when I asked a Question in this House was to have a full inquiry into the system of sea transport between the Western Isles and the mainland and the Port of Glasgow. It is genuinely felt in the Highlands that the MacBrayne monopoly along the West Highland coast, as at present operated, is strangling the general economic life, and particularly that of many small communities. While we must remember that the smaller the island is, the farther away it is, the more uneconomic it is to run goods and passengers there; nevertheless, the higher also is the cost of living for the people who are working in those places. They must have consideration. They are our fellow citizens in peace as well as in war.

I wish we could remember our obligation to them in peace time as well as they remember theirs to us as a nation in war. The nation never forgets to send out the little official envelopes when war is declared, and the Islesmen have always been the first out with the R.N.R., even before war is declared. Yet, as soon as the war is over and they go back to the islands, they are again forgotten. They are left to the tender monopoly mercies of MacBrayne's; forced to pay a higher cost of transport than any other citizens, and carry the burden of a higher cost of living.

I promised to give an example of the recent working of D.A.T.A.C. A constituent of mine, a very enterprising and reliable young man, wanted to expand his business of contracting and sub-contracting work by acquiring machinery for road work and for various jobs in civil engineering. The county council would be more than willing, I know, to support him all the way; and he gave its name as one referee. His second referee was the Crofters Commission, whose name he also gave. The Committee at the Treasury which is ostensibly advising on these matters and is in fact operating the Distribution of Industry Act, 1958, was also referred by him to his banker. This was to show that he had attempted to get the capital by the ordinary means through the bank.

I know for a fact that one of those referees was referred to by D.A.T.A.C. and supported his application; but the bank was never approached. The other referee was never approached. He then received a letter from D.A.T.A.C. telling him that he did not satisfy the requirements of the Act. What this meant, by implication, was that he had not satisfied the condition of having gone through the ordinary channels to raise the money that he could not show that his business would benefit the area, which was one of high, persistent unemployment, and show promise of succeeding and giving employment. Yet his business has every one of those required characteristics. It is in an area of high, persistent unemployment—none higher. He had been to the ordinary channels for his finance and could not get it. He had given two excellent referees who would themselves have been his employers part of the time and have given him work for his employees. He satisfied every condition in fact and every condition of common sense, yet he was turned down flat by D.A.T.A.C.

I say "turned down flat" because I want to emphasise to the Minister that this is an advisory committee. When did an advisory committee become the boss of the Government? The Government can turn down the advice of a committee when it suits them. In a case such as this, why accept the tyranny of an advisory sub-committee of the Treasury? I know the Government accept the tyranny of the Treasury itself many a time; but why accept as the last word the rejection of a scheme of this kind by D.A.T.A.C., which is merely advisory?

I wanted to show that in this area we are qualified possibly more than any other area in Britain for any assistance that can be justified under development area conditions, under D.A.T.A.C. terms of reference and the Distribution of Industry Act. Yet nothing has happened, except that there has been a burst of lovely spring and early summer weather which automatically created some seasonal jobs. But these can at best be only a seasonal solution for a small number of the people in the area.

The Government should be thoroughly ashamed of themselves. They are all Scotsmen by birth even if not by education, except perhaps for one. I should have thought that it would have weighed heavily on their conscience that there were parts of Scotland with the unemployment figures which have been quoted, such as 20 per cent. in Caithness and 28 per cent. in the Western Isles. Yet this goes on month after month fourteen years after the end of the war.

What are the Government offering us in the Western Isles, instead of an employment policy and instead of assistance under the Distribution of Industry Act? They are offering us, in the event of war coming along again, not only the traditional right to have the R.N.R. called out or the right to have the boys marching off again as they did in previous wars, but, in addition now, a N.A.T.O. base, to be manned partly by Americans, Frenchmen, and goodness knows whom. That will not give jobs to our people. It will disturb the whole way of life of the community. On top of that, it may literally be a Tory Government bombshell one of these days. We have had a refusal on the part of the Minister of Defence to give any assurance but that the place will be used as a storage and landing dump for nuclear bombs. Our enemies could not do worse than that except detonate the bombs themselves. Since nothing in reason seems to move them, I wish somebody would detonate at least a small bomb under the seats of the Government.

7.42 p.m.

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

I very much appreciated the speech made by the Parliamentary Secretary. I particularly welcomed the part where he emphasised the need for greater diversity in the industries which we try to encourage to provide employment in Scotland.

I want to outline to the Minister an idea which I think could be used in Scotland to provide a modest but welcome form of employment all the year round for a number of people. The Minister will no doubt have an idea of the topic to which shall refer, because yesterday I had a Question on the Order Paper asking whether the Minister would set up an inquiry into the economics of developing our mountain districts by means of appropriate roads, cable railways, restaurants, and so on, to put them on a par with what one finds in every other country in Europe.

In the last forty years the habit of the travelling public has completely altered, and it has altered because of modern means of transportation. In France, Switzerland, Austria, Italy and Germany one finds that the mountains are made accessible by road or rail so that one can get to the base of the mountains, and there one finds cable railways to take people up the mountains so that they can enjoy the lovely air and the view. Forty years ago the only people who got to the top of mountains were a few enthusiastic mountaineers.

On going superficially into the figures of many of these installations abroad, I find that the summer revenue developed from these mountain restaurants and railways is greater than the winter one for which they were originally conceived. I hope that the Minister will not just take up this matter with the Tourist Board as he promised, or that, if he does so, he will add the condition that some action must be taken to find out what it would cost, what the revenue is likely to be and how many people could be provided with employment. I have made my own estimate and because of that I am pressing the Minister to have an official investigation made into the possibilities of providing full-time employment—that is what it would be—at no cost at all to the Government.

I believe that we should experiment with at any rate one scheme of this kind, and it should be done by a company owned partly by the Government and partly by private enterprise, rather like the Anglo-Persian Oil Company, with a 51 per cent. Government holding. My reason for suggesting that is that we have to deal with the Forestry Commission, and we also hope that the locomotive works in Perth and Inverness could service the mountain railways. There are a number of public interests involved. Therefore, this is not just a private enterprise job, but private enterprise can play its part because the directorship of the shareholding can represent landowners, hoteliers and all those who have an interest in the catering and tourist trades. I also believe that the funds will be forthcoming because I understand that already an offer has been made by one anonymous enthusiast to put up £25,000 if other people will do the same.

I believe that here is the perfect opportunity for trying out a scheme where the Government and private enterprise work together. I believe that on investigation it will be found that the scheme can work. I should like to itemise what I consider to be the basic minimum requirements.

We must first have a road to the base of the mountain and a car park and a restaurant there. We must have a cable conveyance to take people up the mountain, and it must be an all-weather one, not just a winter one. It should be either a gondola railway with small closed cars seating two or four persons or preferably, I believe, a higher speed type of cable car railway, such as the one connecting St. Christopher with Galzig at St. Anton, where twelve people go up at a time, completely enclosed in the winter and with the windows open in the summer.

I believe that the cost of these cable car railways is low because the span between the pylons can be as much as 1,000 feet, and, therefore, all one has to do is to have a few pylons with the cables tensioned by massive stations at the top and bottom. These cable railways have been springing up in European countries especially since the war—these are not pre-war installations; many of them are very recent, and more are planned—and I feel that they would not be coming into being if it were not a paying proposition.

We must move with the times and not be influenced by the fact that at present our main roads are remote from the base of our big mountains. We must build the necessary spur roads or through roads, and we must pioneer at any rate one railway up to 3,500 feet or 4,000 feet and get an idea of the revenue which it will produce. I visualise a pioneer installation like this employing 100 people one way and another.

I believe that there will be a good winter trade from skiers, and that will run from December until April. The tourist trade starts in May, and that will run on until October. November and December is the time for overhaul and servicing. I believe, therefore, that there is a real possibility of developing our mountains, which have been neglected in the past. I believe that this will not only be profitable but will provide employment for people in the remote areas to whom it is difficult to take any other form of industry.

Connected with the Question that I had on the Order Paper yesterday was a request to the Secretary of State to review the line of road joining the Dee and Spey. He gave me what I call rather a "Civil Service" Answer, that it was the responsibility of the county authorities concerned. This is something wider than the authority of a county council. This is a road that can lead to something on a national basis, and I hope that the Secretary of State will look at this matter again.

With modern motor cars and new ideas of siting roads and keeping them clear of drifting snow, a road could be built right through the heart of the mountains from the Dee to the Spey. It would have the effect of putting this mountain area to which I have been referring within reach of Dundee, Aberdeen, Perth and Inverness. It would double the possible number of tourists who would come to the area because at the moment they tend to divide between East and West. It would be well worth considering the finances of building this road and the work which it would provide at the same time as we consider the evolution of a new policy for using the natural features of our mountainous countryside.

I hope that the Minister will look at this carefully. I hope that he will have an inquiry made, at any rate in broad outline, literally within weeks and, if the prospect is good, that he will perhaps, go further and allow me to put down a Question on which he can make a statement.

7.52 p.m.

Mr. Hector Hughes (Aberdeen, North)

The hon. Member for Glasgow, Scotstoun (Sir J. Hutchison) said that there had been great variety in this debate. I agree, but that is about the only thing said by the hon. Member with which I agree. There has been great variety. On the one hand, we have the hon. Member for Fife, East (Sir J. Henderson-Stewart) and the hon. Member for Scotstoun, both ex-Ministers of the Conservative Government, differing. The hon. Member for Fife, East, with all his experience as a Minister, does not know what the needs of Scotland are and recommends that the Government should set up an inquiry to find out. It may take years. It may take three years or ten years. In the meantime, let Scotland languish.

The hon. Member for Scotstoun says, "No, we want no inquiry because I know very well what the needs of Scotland are." The fact is that if the Government know what the needs of Scotland are they have kept them a pretty good secret. Although they have been in office all these years they have not adequately implemented all the statutory powers which it is within their power to do.

The hon. Member for Caithness and Sutherland (Sir D. Robertson) differs from everybody. He is an independent Member on his own. He says that he, as an independent party of which he is both leader and follower, knows what the needs of Scotland are, and that he will implement them. He will implement them with the solidarity of the party he leads with such distinction and such success.

Next we have the Parliamentary Secretary to the Ministry of Labour who opened the debate for the Government, and finally there is the Report itself. The Parliamentary Secretary and the Report seem to agree. The hon. Gentleman seems to agree that the Report is a poor, sad, melancholy document.

I shall prove the arguments I wish to present to the House by reference to the Report and by reference to some specific cases from my own constituency. Before doing that, I must draw attention to the fact that my hon. Friend the Member for Hamilton (Mr. T. Fraser), who opened the debate for the Opposition, put certain concrete problems to the Government. The Parliamentary Secretary affected to reply sincerely, because he is a very sincere and conscientious man, but he failed to reply to all the points made. He talked of the distribution of industry; he talked of various other problems, but he found no solution for them. Nor did he address himself to the specific problems which were put clearly in the distinguished speech by my hon. Friend.

This Report is a poor, melancholy document. As nobody else has said it, I should like to say that it is prepared by the Civil Service with skill, accuracy and loyalty. It has been prepared with that skill, accuracy and loyalty which faithfully serve every British Government, however bad they may be, and this is a Report of a bad year by a bad Government.

The Report confesses to a decline in industrial activity which the Government failed to arrest. It confesses to injury to Scotland's economy which the Government failed to maintain. It confesses to alternations in employment and unemployment which the Government failed to prevent. It confesses to irregularities in productivity and export which the Government failed to rectify.

I said that I would prove what I am saying by reference to the Report. Paragraph 1 says: During the year 1958, Scotland's economy was affected by the decline in industrial activity which occurred throughout the country as a whole. The country as a whole is under this Government, and it is the duty of a Government, as I shall prove by a quotation from an undoubted authority who is not a Socialist, to rectify that. Paragraph 2 says: In the United Kingdom as a whole, the volume of industrial output … was slightly less than in 1957 but equalled the level of 1956. What does that mean? It means that we have retrogressed and we continue to walk backwards like a crab when we should continue to walk forwards, as a proper Government should. Paragraph 3 says: In Scotland, the reduction in output … began earlier and has been more pronounced. That means it began earlier in Scotland than in England, and has been more pronounced in Scotland than in England. It shows Government neglect by the Scottish Ministers. Paragraph 4 says: The output of the manufacturing industries … was about 3 per cent. less in 1958 than in 1957. Again we are walking backwards, and if a crab does not walk backwards I do not know what kind of an animal does.

Mr. Lawson

A lobster—it jumps backwards.

Mr. Hughes

Paragraph 6 says: The number of employed persons … was 2 per cent. fewer than in 1957. That is more retrogression, and more walking backwards. Paragraph 8 says: The upward trend in unemployment … continued. The upward trend, not of employment, but of unemployment, continued. In my submission these words of the Report are a confession by the Ministers of their own failure.

These failures should not occur, because industry and employment in Scotland are rich in potentialities, scientific skill, vast factory space, plenty of water, electricity and clear air, strong, healthy and energetic workers. The fact is that Scotland lacks Ministers who can link these potentialities and who can fully exercise the statutory powers which they already have and who can use them with energy, vision and skill and secure a fair spread of productivity in North and South Scotland and who can co-ordinate production, distribution, exports and imports so as to make Scotland a prosperous country.

It is striking and noteworthy that we find the opposite features in other countries not very far away. We find that "down in England", as they say in Scotland, in Northern Ireland, in West Germany and in America there are not these damaging and catastrophic features. Why? It is because the Ministers there use statutory powers and apply themselves to the needs of the territories which they have to govern. I ask why existing statutory powers are not fully used in Scotland? Why are the vast open spaces of the North of Scotland left idle and undeveloped? Why are there not more and better roads in the North of Scotland? Why are the railways not electrified—as the Minister should be electrified—more quickly?

Let us look at the disparities between the North and South of Scotland. In the South of Scotland, there are massed industries and population, but sad unemployment which could be cured by a skilled Government replacing Ministers whose hearts, interests and minds seem mare concerned with what is happening in England than with developing Scotland. So much for the South of Scotland.

The North of Scotland, with its great open spaces and cheap rents, could easily be profitably exploited by modern science which annihilates distance—and distance is put forward by many as an objection—just as successfully as Northern Ireland is profiting by the patriotic skill of its enterprising Government.

Northern Ireland's Government and people, with great unemployment recently, are increasing their trade, industry and employment, and foreign capital is coming in, cheap rents are being made available, grants are being made to build, buy and extend factories, machinery and skill and to assist in the scientific research which is necessary to that country.

I submit that that is an inspiring example which the Government should follow, but the Government are so pessimistic that they gauge the nation's economic position by comparison with the lowest and not the highest, by comparison with slumps, not booms. In their practice, statesmanship is degraded by their taking as their criterion low rather than high standards. Under the present Government, Scotland's national fortunes are wilting while development areas feel it most.

A standing example and the strongest support I can find for that flows from the Parliamentary Secretary to the Ministry of Labour, who was recently in Scotland. He is one of the more conscientious Ministers of the present Government. He visited Aberdeen recently and frankly and truly said: Everyone living in the more difficult employment areas was anxious that the Government should help by getting new industries to come in. But while there were many places wanting new industries the fact is that there is no new industry to meet the demand. English Ministers have said the same thing of England. Industry is languishing all over this island, not only in Scotland. Is that not a criticism of the Government and an indication of the Government's failure to look after the country's prosperity?

When in Aberdeen, the hon. Gentleman was told that Aberdeen was too far north—too far north in these days of nuclear travel when distances are annihilated! The Minister gave the proper reply when he said: I am not impressed with the geographical argument. I am convinced that the advantages you have in this area—very good labour and adequate supply—by far off-set any disadvantages. With that dictum of the Minister I cordially and respectfully agree. Obviously, he went to Aberdeen with an open mind, gathered the facts and articulated them as a Minister should.

I shall now turn from the general consideration of the Report to four glaring instances of Government ineptitude in my own constituency—which is Aberdeen, North in case anyone does not know—

Mr. Patrick Maitland (Lanark)

Where is it?

Mr. Hector Hughes

—by wasting well-equipped factories, expensive precision tools and highly qualified skill.

The Consolidated Pneumatic Tool Co. Limited has had to reduce staff at Tullos Tool Factory, Aberdeen, because, as the firm said to me in a letter dated 10th April, 1959: For several months past, we have been carrying a labour force in excess of our requirements. We have not had enough work to keep all the force economically and profitably employed, but we continued to absorb the excess costs in the hope the position would improve. The writer went on to say: I must be realistic and tell you that an increase in demand in our own field of production or the placing of new types of work—any kind which we would immediately examine for its suitability—is the only help which would enable us to re-employ labour in Aberdeen. If you can assist in either of these directions, please do not hesitate to communicate with me at any time of day or night. Is this not a cry from the heart from that distinguished company?

The second instance is that of Messrs. C. F. Wilson & Co. (1932), Limited, of Aberdeen, oil engine manufacturers, who sent me a copy of a long, three-page letter dated 11th May, 1959, which the firm had written to the Joint Under-Secretary of State for Scotland, the hon. Member for Dumfries (Mr. N. Macpherson), who is to reply for the Government tonight. The letter says: We are one of the Aberdeen engineering firms who have probably suffered more than most from the recent trade recession. I will not quote the whole letter, which goes on to say: Our problem is to obtain sufficient work to keep our existing workers employed. Lack of funds does not arise; the fact that we are working very much under capacity means that our available capital is not fully employed. For over 50 years we have been makers of horizontal Diesel Engines and since the war and until 1954 we exported close on a quarter of a million pounds of these engines annually to the Middle and Far Eastern countries and South America. Since then, through balance of payments difficulties, tariff barriers, such as erected in India and Pakistan, political upheavals in Abadan, Suez, Syria and Iraq, we have been faced with a continual shrinking market, until today it is reduced to an uneconomical level. The letter goes on to say: Although we have been forced to declare a considerable number of our men redundant, we have retained all our key men and as many other hands as possible. Obviously, in this firm's breast hope springs eternal that work will come.

The third firm which wrote to me is Messrs. A. E. Stewart (Engineering) Ltd. It is a firm of structural and mechanical engineers and specialists in public works, building and quarry plant and it also does blacksmith work and electric welding. By letter, as recently as 27th May, this firm says: Due to trade recession in mines and quarries our orders have sunk considerably and we are now employing only half the number we were last year. This is very unfortunate both for employees and directors, especially as within the last two years we expanded our premises and plant. The fourth of the four firms is Messrs. R. G. Garvie and Sons of Aberdeen. It is also a casualty of the Suez adventure. It is a firm of engineers and millwrights, operating in a big way, which makes and sells agricultural machines for sale at home and abroad. Its machines had a good reputation all over the Middle East. In its letter, after Suez, it said: This has brought us into very great difficulty with our customers and due to the late delivery, as these machines are for the Land Reclamation and Ministry of Agriculture, the Administrations reserve the right to either impose a penalty of 4 per cent. of the total value of the contract as fine for the delay in the delivery, or otherwise cancel the contract and confiscate the 10 per cent. guarantee deposit lodged by our customers, and purchase the goods at any price available from the open market. They will also delete our name from the list of approved suppliers of threshers. Our machines have a good reputation in the Egyptian market and it is unthinkable that this should occur, especially at this moment when the unemployment position in Aberdeen is so acute. These are only four examples of the damage that is being inflicted upon the trade, industry and employment of Aberdeen by the present policy of the Government. In the City of Aberdeen, in May, 1951, there were 1,665 unemployed people. In May, 1959, after eight years of Tory Government, that number had grown to 3,681. That is more than double the 1951 figure. In the County of Aberdeen, in May, 1951, there were 2,714 unemployed people, and in May, 1959—again after eight years of Tory Government—there were 5,583 which is again more than double the 1951 figure. Children leaving school are unable to find work. It is a terrible and demoralising thing for these young citizens to find themselves unwanted in the community for which they were educated and which they want to serve. Between 1954 and 1958 the number of unemployed young people increased by about 20 per cent.

This is a situation for which the Government must take responsibility. I said that I would quote a non-Socialist authority for that proposition, because it may fall upon the ears of members of the Government more graciously than would a quotation from a Socialist. Sir Roy Harrod, the distinguished economist, recently wrote: Until 1939 no Government would have been prepared to accept full responsibility for the condition of the national economy. It was an obligation thrust upon the State by the war and by the wartime need to control entirely the means to achieve victory. No Government since, irrespective of party, has thought it reasonable even to question its ability to determine the course of economic affairs, much less attempted to shed any of the responsibilities. By neglecting and flouting these responsibilities I submit that the present Government have shown that they are outmoded and unethical. They should take their example from Northern Ireland, Western Germany or even Japan or America, whose Governments attend to the needs of the people If they will not do that, I say in all sincerity that they should get out and make way for a Government which will attend to those needs.

8.15 p.m.

Lady Tweedsmuir (Aberdeen, South)

I hope that I speak for all the House when I say that we have all immensely enjoyed the manner of delivery of the speech of the hon. and learned Member for Aberdeen, North (Mr. Hector Hughes). On the other hand, I regret that he is not thoroughly conversant with all the matters within his own constituency. He constantly used the simile of the Government and a crab, saying that the Government walked backwards like a crab, but I challenge him, on his next visit, to examine the crabs in and around his constituency. When he finds one that walks backwards I hope that he will send it to me.

Mr. Lawson

Did not my hon. and learned Friend the Member for Aberdeen, North (Mr. Hector Hughes) point out that it was the lobster that he had in mind? The lobster does jump backwards, just as the Government have been doing.

Lady Tweedsmuir

No. I listened to every word uttered by the hon. and learned Gentleman, and he specifically mentioned the crab.

Part of the burden of his argument was that the economy had gradually run down. I will not go again into the economic arguments which have often been debated in the House, except to say that the financial restrictions put upon the economy by the Government were imposed because they believed that at the time that was the best way to tackle our chief problem, which was then, without doubt, inflation. All the statistics, which are well known to hon. Members, prove that this country weathered the worldwide recession better than any countries in North America or in Western Europe.

The other point made by the hon. and learned Member was that if the Government had given Scottish industry the financial aid which he suggested was required—and this was the burden of many speeches made by hon. and right hon. Gentlemen opposite—we would automatically have improved the industrial situation.

It is on this aspect of the matter that I want to say a word. We are getting into a very grave situation if we think that by giving financial aid to our industries we can compel customers to buy from us. I hope that hon. Members will not mind my quoting facts concerning my own constituency. Many of the difficulties confronting firms in my constituency at the moment arise not so much from the fact that they need the capital at this time as from the fact that it is difficult to find markets at this increasingly competitive period.

I am happy to say that the employment figures for the City of Aberdeen have improved to a certain extent. At any rate they are below the Scottish average. There is a great deal of danger in quoting statistics, but the fact remains that the figure of unemployment in the City of Aberdeen has been reduced to 3.9 per cent., whereas, as everybody knows, the latest figure for the whole of Scotland, quoted from the Government Front Bench, is 4.4 per cent. Of the 2,662 men out of work, 549 are disabled and 60 are temporarily suspended. We have very little short-time working. Of the women unemployed, who total 954, no less than 70 per cent. are married. We must face the fact that many married women today do not want full-time employment.

Most of the difficulty in placing people arises in the case of those who are unskilled. The level of employment is very uneven. The building trade, as one would expect at this time of the year, is doing very well. Indeed, it cannot get enough joiners at the moment. In addition, the paper and granite industries are in an excellent condition. If hon. Members know of any public or factory buildings which are to be erected I recommend them to consider facing those buildings with Aberdeen granite. I also recommend hon. Members to look at Bowaters' building in Knightsbridge. This has been faced with granite from Aberdeen and the firm concerned has just won a contract worth £250,000 to do the same thing in connection with a building in Oxford Street.

This is an example of an industry which can adapt itself to modern techniques and modern methods. Whereas in the old days houses were built of big, solid granite blocks, now that has become in many cases too costly and the new method is to pin to the base a facing of polished granite of an inch or an inch and a half in thickness, which produces a very fine finish. It is an example of a very old-established industry which has managed to readjust itself to meet the competitive market demands of the modern age.

While it is a fact that we have only about 100 people unemployed in the engineering industry, nevertheless it is one which, I think, gives perhaps the greatest concern at the moment. It is a basic industry, and it is one in which there are greatest difficulties in finding markets at this time. That is where I come to a difference in outlook, which has been very evident in this debate, with those members on the benches opposite who seem to put forward the argument that were we to give enough financial aid that would largely overcome many of our problems. I have found that firms say that it is not the financial inducements of D.A.T.A.C. that are, for example, going to be of help to them. They are not short of capital. They do not really want a subsidy. What they want today is to have the facilities of the Government to try to help them find new contracts, either sub-contracts or contracts for manufacturing under licence.

One firm in particular has been both to the Scottish Council and the Board of Trade for a considerable period. The Scottish Council wrote to me about this firm and said that it had given a good many opportunities for industry to this firm to consider and that there was No lack of enterprise on behalf of this firm. They have followed up with the greatest vigour all the suggestions put to them, but there is a general contraction in heavy and medium engineering. The Board of Trade, on the same subject about this firm, said that it had also done a good deal to put the firm in the way of markets overseas or at home and: The Government's part is to create the condition in which industry has the chance to expand and it is then up to the industrialists to take the chance. I believe that is so, because we cannot compel a customer to buy our products. Therefore, I should like to ask what consideration is being given in the negotiations that are about to take place in connection with the Russian Trade Agreement to Scotland's getting a chance to tender for the products needed in exports to Russia. If we take, for example, consumer goods, there is a quota overall of nearly £2 million and I can see an absolute scramble from every sort of industry in this country to get into the Soviet market. I should like to ask whether the Government would consider the Board of Trade offering the first opportunity to those areas which are suffering the heaviest unemployment and the greatest difficulty.

I should also like to ask whether any active help is being given to Scottish industrialists to follow up the very considerable work which has been done after the last Canadian Trade Mission. I think that we have a very great opportunity to replace a considerable part of the United States' share of the Canadian market provided that we really understand what are the difficulties and what is needed in the Canadian market. We can do it without any detriment to the Canadian home producer. There is such a huge domestic market in the United States that it can, of course, send the overspill from that market over the border to Canada at prices which we would call uneconomic. We must recognise the fact that the Canadians are very accustomed to United States specifications, United States machinery and United States methods of wrapping and advertising.

Indeed, the flood of advertising material over the border into Canada is something with which I do not think the Scottish industrialist yet understands how to compete. Our method of sending off catalogues and quiet polite understatements of our achievements simply will not match with the public relations campaign of the United States in the Canadian market. I think that many people have been misled by the fact that there is a great identity of outlook in many matters between Canada and Scotland, more so than south of the Border in England and Wales. I was rather encouraged the other day to see something in a journal that came to me—the British Columbia News Letter—in which was reported a speech by the British Columbian Minister of Highways about the attitude of British manufacturers at this time. He said: … ten years ago it seemed to him that British business men expected customers to come to their doors as though it was a favour to sell them something. That has gone. British business men are showing a much more determined spirit—they were knocking at British Columbian doors, and their whole attitude was much more aggressive. I think a good deal could be done, perhaps through the Board of Trade, and I hope also through the Scottish Council, to try to suggest to our own manufacturers that they should try to get into this market now, because now is the opportunity. If they do so they must send people overseas who are top executives and who have the power to take decisions on the spot and who will themselves understand what is needed in that particular market. I should also like to know that their encouragement or advice is being given about the export possibilities to Latin America.

In January I had the first chance of my life to visit parts of Latin America, Venezuela, Brazil and the Argentine. I was immensely impressed by the great possibilities which undoubtedly exist there for all kinds of business, both for heavy engineering and lighter consumer goods. The market is ready for us to enter. We had the visit by the President of the Board of Trade to Venezuela. Regarding Brazil, it is always said, "What about the credit position?" But America is giving enormous sums of money to support Brazil and she is not doing that for nothing. Nor would the Germans enter that market in great numbers if they did not think that there was a future for them there. I believe that if the Board of Trade could suggest these possibilities to our Scottish industrialists in a more aggressive and positive way a good many would be prepared to take advantage of the opportunities which exist.

It is, of course, true that in some places, such as Aberdeen for example, a great variety of small firms might not be in the position to take advantage of the opportunities offered in these export markets. I ask, therefore, whether the Board of Trade will seriously consider exerting its influence, and suggesting that some of these smaller firms should join together in the kind of consortium which is now common in relation to capital investment in countries overseas. While still retaining their own independence and character, many such small firms could combine in that way in order to enter what are without doubt very difficult markets to penetrate.

I wish briefly to refer again to the subject of attracting new industries which I had an opportunity to discuss not long ago. Previously I have had considerable sympathy with the Government argument that when there are advance factories standing empty it is unwise to spend public money on building fresh factories all over the country on what is undoubtedly an experimental basis. But now I have changed my view to some extent. One of the difficulties of being a Member of the House of Commons is that one is sometimes inclined to change one's views. I have always taken a great interest in the possibility of a European Free Trade Area. As one knows from personal experience, there are American firms which, when deciding whether they should come to this country or go to the Continent, prefer to go to the Continent because there is at any rate a European Common Market established, and there are still doubts about the arrangements for a European Free Trade Area. That being so, I Chink we must give an added incentive to overseas businesses to come to this country.

I do not feel competent to judge the form in which the building of advance factories should be undertaken, or to what extent we should subsidise rentals, but I think that instead of building one experimental factory at Coatbridge, it would not be unwise to build, say, a dozen such factories all over the country, and I hope that one would be built in Aberdeen. I have discovered that there are now less than a dozen empty Government factories in Scotland and there are inquiries about the occupation of those factories. So I am driven to the conclusion that, were such factories erected in certain areas, even though they might not be tailor-made to meet the requirements of prospective occupants, they might attract industries from overseas.

I have taken a great interest in all kinds of fabrics for the development of housing and I think that this country is lagging behind in that respect. The methods used in North America in the building of prefabricated factories and houses provide a good example. A start is made with a small factory or a house, and when more accommodation is required, it can be ordered by post. It is as simple as that, an extra room for a house, or an extension to a factory, may be ordered by post. There is a great deal more that we could learn from a study of methods of prefabricated building.

I do not think we can have an absolute plan for industry in Scotland, or in the United Kingdom as a whole, because our tradition is based on variety and variety means change. Those responsible for management, those who work in industry without the responsibility of management, those who put up the capital and those responsible for Government policy, must all be ready to take advantage of changing circumstances. That means that, inevitably, there will be ragged edges to the pattern of industry and to the employment position in this country; but if we follow the lead of energetic and public-spirited industrialists, and back what they are trying to do, I think that there will be a great industrial future for Scotland.

8.35 p.m.

Mr. William Ross (Kilmarnock)

I was almost waiting for that confession of the noble Lady the Member for Aberdeen, South (Lady Tweedsmuir). I knew it was bound to come and that she would tell us she had changed her mind in reference to financial inducements to industry. We have heard all this before. Always, in the end, the noble Lady's speeches lead up to the fishing industry. We had the same thing from her today. She built her whole speech around the idea that it would be bad for Scottish industry to get financial inducements, and then she finished by changing her mind and by being very generous with money from the Exchequer as an inducement to industry to come to Scotland. She did not show a lot of sense about that either. She is very late with her change-over of mind, because the reason for the reluctance of industry to come to Scotland is the very existence of the Common Market and the failure of Britain so far to make the necessary arrangements.

In the month of June, 1959, there were 94,000 registered unemployed in Scotland. We have already had figures given to us, and I got them from the Minister of Labour the other day, showing that from May, 1957, to May, 1958, although the unemployment figure had risen only by about 24,000, there was also a drop in civil employment in Scotland of nearly 50 per cent. So the 94,000 is not a figure which tells the whole story.

Besides that, there are people who have gone out of industry, like married women with husbands who are working. They get absolutely nothing from the employment exchanges, so they do not register their unemployment. There are also the older people, who were being told a few years ago, "Stay at work, because the country needs you", and are now being paid off. The drop in the earning capacity in Scotland and the facts of under-employment of people are not fully represented by that 94,000 of unemployed. These are double the number, relatively, of unemployed in England, and a great many more than the year before.

This is the time of year when we expect a dramatic fall in the number of unemployed. The real test will come not in the next two or three months but after the General Election, in November, December and January. Shall we go back to the 116,000 unemployed that we had last January? I see that the wisdom of the Minister of Labour in being born in Yorkshire is being applauded. He is back with us. This rather reminds me of the Scotsman who asked a person where he came from and when the person replied, "I was born an Englishman and I will die an Englishman", he, as a good Scotsman, answered, "Och, man, have ye no ambition at all?"

I wish the Minister of Labour could give us his calculation now of what he thinks the unemployment figure will be in Scotland next January. From the way things are going at present, and from the fact that there is no improvement in the building industry and other industries on which the real wealth and development of Scotland ultimately depend, the outlook is serious and bleak indeed. Short-time working has increased just when we expected it to fall. What is the explanation? When we take into account the fact that half the 94,000 have been unemployed for more than two months, the position is serious, and we shall have to look a little more closely at it.

We have had plenty of speeches about it. The Parliamentary Secretary to the Ministry of Labour and the Parliamentary Secretary to the Board of Trade have been up in Scotland. The Minister has even managed to drag out of his seclusion this publicity-shunning Prime Minister and to get him to go up to the very place which is dedicated to the glamourised conventions of Hollywood. We had the Prime Minister giving his opinion there on how Scotland was going under the rule of the Unionists. Once the right hon. Gentleman crosses the Border, he changes his coat. He stops being a Conservative and he starts being a Unionist.

In Glasgow on a Saturday afternoon, having opened a shopping centre in a new town, he said: There is no room here for the nationalisers and the State planners. He went on to tell us about the great development in linking up the farms with electricity, and all the rest of it. Today we have had from the benches opposite recognition that if anything is going to be done for Scotland it should be done by the Government. Hon. Members opposite have lost faith in private enterprise. There was the modest suggestion by the hon. Member who made one of the finest maiden speeches that I have heard. Whether it was non-controversial, I would not like to say; I suppose it is now non-controversial when a Tory makes a demand for three separate subsidies in his maiden speech.

Then, making our way through the lot of them, all adding their demands for Government aid for private enterprise, we come to a man who is a veteran of the National Liberal Party, the henchman of the Secretary of State himself, and who only a short time ago was one of the most successful Scottish Ministers, the hon. Member for Fife, East (Sir J. Henderson-Stewart). He goes further. It is not just aid for private industry that he wants. He wants a commission of inquiry. I wonder what he was doing all those years when he was responsible for these matters in the Scottish Office.

The hon. Gentleman wants even more than that, for that is just a means to an end. He wants a five-year plan. [HON. MEMBERS: "A ten-year plan."] He wants either a five- or a ten-year plan. I wonder whether he was in the Playhouse in Glasgow cheering with the rest when the Prime Minister, that man with unsuspected gifts of statesmanship, was saying that there was no room for the State planners. Here is a man who was selected by the Prime Minister to shoulder the responsibilities of government in the Scottish Office and who has come to the considered conclusion that we require a five- or ten-year plan. I think we do, too, but I do not think we require a five-year investigation.

Sir J. Henderson-Stewart

No, I did not mean that.

Mr. Ross

I know the hon. Gentleman did not mean that. I would remind him of another Prime Minister who, speaking in Dundee in 1918, suggested that what we ought to do was to nationalise the railways, and someone said "Let us have a Royal Commission" to which the Prime Minister said, "No, we have not time." It took us another thirty years before we got the railways nationalised. I hope the same thing will not happen in respect of the five-year plan for Scotland.

We should consider what was referred to by the Parliamentary Secretary to the Ministry of Labour as the causes of the present position. I think they are interesting. There is the trade recession. The Prime Minister, in his letter to the hon. Member for Galloway (Mr. Brewis) at the by-election, referred to this as a mild trade recession. So it was. But it is no good saying that we weathered it far better than anybody else, for when unemployment was rising here it was falling in other places. Let us not forget that unemployment can be registered in different ways, and these figures are not always relevant.

The trade recession was aggravated by policy decisions taken by this Government. Indeed, the actions which were taken to correct the inflationary situation were taken over a year late. They took decisions on credit policy affecting private individuals and private enterprise, and they took direct action in relation to the nationalised industries which has caused very considerable hardship to the nationalised industries. Let us consider the position of two basic industries, coal and transport. They are trying to do in a decade work of reorganisation and revolutionary change which should have been spread over four decades. Into the middle of it comes decisions of the Government affecting their modernisation programmes and, not for the first time, throwing everything out of gear and creating unemploy- ment. Moreover, as a result of the recession—the induced and exaggerated recession—there has been a slowing down in trade throughout the country, and this hits the basic industries hardest and hits them all the time. They must cope with that as well as their reorganisation programme.

I should have thought that the Secretary of State for Scotland would know something about this. There was a time when he was Minister of Transport. He should appreciate the difficulties which the nationalised industries have been put to. Indeed, I would go further and say that if the two industries to which I have referred had not been nationalised, they would have been in a state of chaotic bankruptcy today. The Government, in my view, have gone out of their way to hinder these industries. They should leave them alone and let them get on with their real job.

"No room for the planner"?—Britain would be in a bad way today if it had not been for the planner, and Scotland will be in a bad way in ten years if we do not have the five-year or ten-year plan to which the hon. Member for Fife, East referred.

Sir J. Henderson-Stewart

I did not mean that the commission would sit all that time. I meant only that it would sit to do its job for, perhaps, eighteen months.

Mr. Ross

The important thing about the hon. Gentleman's speech, I think, was that he failed to elaborate on the actual five-year plan and who would carry out the financing and so forth. That is something which we can take up later on.

There are other matters for which the Government must carry responsibility. We had some very "phoney" figures from the Prime Minister about the number of people provided with additional jobs last year. What he forgot to say was that the Government were responsible for the loss of 4,000 of the hitherto most stable jobs in Scotland in the Royal Ordnance factories and Admiralty establishments. My hon. Friend the Member for Greenock (Dr. Dickson Mabon) can tell us something about these. That happened last year, and the process has not been completed yet. The hon. Member for Central Ayrshire (Mr. Nairn) knows that there are still about 300 more people to lose their jobs at the Royal Ordnance factory at Irvine before the summer is out. My hon. Friend the Member for Fife, West (Mr. Hamilton) has told us about more redundancies at Donibristle. Elsewhere, there are to be seen in redundancies the results of decisions taken by the Government.

Recognising, as they ought to do, the special vulnerability of Scotland and the Development Areas, they ought to have related their policies in relation to redundancy and the closing of Government establishments and Government controlled establishments to these conditions. Scotland was far harder hit than it should have been, from Invergordon right through the whole of the country. Four thousand jobs were lost, and the number of new jobs provided barely covered them.

There is another thing for which the Government try to evade responsibility, and I am very glad that my hon. and learned Friend the Member for Aberdeen, North (Mr. Hector Hughes) mentioned this. There is the effect of the Government's foreign policy. Trade with Egypt and trade with Iraq was of considerable value to us. It is no coincidence that we now witness frantic and strange efforts in relation to past policies of the Government and an effort to patch up financial agreements and trade agreements with Egypt, to sell arms to Iraq and to make a trade pact with Russia. I do not think that any of us quarrels with these things. We are delighted about the trade agreement with Russia. We can already see certain benefits which will accrue to Scotland in relation to the provision of capital equipment for the sugar beet manufacturing industry. This will effect a Glasgow firm considerably. However, we must blame the Government for upsetting engineering and capital goods industries throughout the country which thought that they had settled markets in Egypt and in the Middle East. The Government must bear the responsibility for the great measure of unemployment in Scotland due to that.

I now come to the technological developments. A revolution is going on in industry at present and people have been sacked during this era of depression who will not be taken on again. However, it does not only affect them. Work which was formerly done by one hundred men will now be done by twenty-five. Let us consider what is happening in relation to apprentices. There is no longer scope in industry for apprentices, even in the building industry. An apprentice has no guarantee that he will be employed for five years. Firms will not employ apprentices knowing that they have to employ them for five years. Therefore, the technological changes which are taking place affect the employment of young people as much as anyone else. The work will be done with fewer people. We have been caught up in the net of capitalism.

How can we handle this problem? I know that thinking men in the party opposite are very worried about this matter. Is it not strange and paradoxical that we should be worried that we can do without men going down the mines for coal and that we can produce more wealth with fewer men? However, I hope that we shall carry on thinking in this way. Hon. Members opposite are gradually coming round to our way of thinking.

We need more than a five-year plan; we need a socialised plan. It is now generally recognised by hon. Members opposite that Government activity, Government finance and Government intervention are absolutely essential. How can that be achieved without Government control and without the Government being provided with the knowledge about what is happening? The finest things which are happening in Scotland today are due to the planners and nationalisers who are sneered at by the Prime Minister. At long last we have the electrification of the railway from Helensburgh to Glasgow and from Glasgow to Ayr. There are the atomic energy establishments at Dounreay, Chapelcross and Hunterston, the strip steel mill and the Forth Road Bridge. What is private enterprise doing in Scotland which should make hon. Members opposite proclaim its glories and benefits to the people of Scotland?

Where have the Government failed? Obviously they have failed if industry must be supplied with inducements without which it will not work. I hope that we have learned that the problems of Scotland will not be dealt with by distribution of industry legislation. Something more positive than that will have to be done. I hope that the Government will recognise that.

I want to express my deep disappointment about what the Government have done in Ayrshire, where over 5,000 people are unemployed. In one part of Ayrshire during last winter the percentage of unemployment rose to as high as 16 per cent. When we asked the Board of Trade to put up an advance factory, we were told that only one would be put up, and as an experiment, at Coat-bridge. Let the Board of Trade consider what happened in Scotland—certainly in Ayrshire—from 1945 to 1950, when the experiment of advance factories was tried out and proved. It is no wonder that the noble Lady the Member for Aberdeenshire, South has come round to the idea that we should build advance factories. It is interesting to note that the Scottish Council has come round to that idea, and so have many hon. Members. The hon. Member for Glasgow, Pollok (Mr. George) was the first to break the chains to get away from the slogans of the Tory Party, to get down to realities and face the reality of what makes private enterprise move, work and settle in a place: that is, that the Government are needed to provide considerably more finance to deal with this problem.

There should be a reality about the planning. I had a battle with the Secretary of State when he was Minister of Transport. He shrugged it off and said that it was not his job and was a matter for the Railway Executive, which was then closing the locomotive workshop at Kilmarnock. That was seven years ago. The workshop was closed. We were told, however, "Do not worry about that. We are bringing in a new industry to the area. We are giving you the repairs and maintenance of all the crane work."

That was seven years ago. The right hon. Gentleman is now Secretary of State for Scotland. He has responsibilities for the distribution of industry in Scotland and the responsibility of overspill relating to Glasgow. He asked Kilmarnock to help him with overspill and said that the Government would see to what was necessary in relation to industry. Now, however, he sits in the Scottish Office doing nothing while industry is being shifted from Kilmarnock to Glasgow.

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

He is still shrugging his shoulders.

Mr. Ross

That job, which was given in replacement for the change-over of the Kilmarnock workshops in 1952, is now being taken away from Kilmarnock by a policy decision and is being put into Glasgow. The men at Cowlairs do not want it. They would rather have their share, to which they are entitled, of the repair of locomotives.

When will we get some sort of co-ordination of what little scraps of policy there are? When will the Secretary of State wake up to his real responsibilities? One hon. Member has spoken tonight about credit for the steel strip mill. Nobody, on either side, wants the credit for it. We all did it. We backed the Secretary of State because we felt that he wanted it too. If he stands up for Scotland and demands what is essential for Scotland, we will all be with him. It is because we can have no great confidence in him and we have the most wishy-washy set of Ministers at the Scottish Office that the position is as bad as it is today.

Mr. Deputy-Speaker (Sir Gordon Touche)

Mr. Malcolm MacPherson.

Mr. Rankin

On a point of order. May I draw your attention, Mr. Deputy-Speaker, to the fact that we have managed to conduct a debate on employment and industry in Scotland but that during the course of that debate no Opposition Member representing a shipbuilding division has been called to deal with the shipbuilding industry, which is vital to Scotland's economy?

Mr. Deputy-Speaker

That is not a point of order.

8.59 p.m.

Mr. Malcolm MacPherson (Stirling and Falkirk Burghs)

I should like to say a word of congratulation to the hon. Member for Galloway (Mr. Brewis) who made an extremely attractive maiden speech, both in form and substance. We all welcome him to our debates. He has joined us, at least in the sense of speaking, in a debate in which there was at the beginning a considerable appearance of desire by Government supporters to take part. One has seldom seen such a large phalanx of Government Members as stood up at the beginning of the afternoon. I think that that is a measure of the worry which hon. Members on the Government side as well as on this side feel about the economic situation in Scotland. Whether we have a constituency which is one of those with a very high rate of unemployment or whether we have a constituency where things are better, we are all of us concerned about the future of the Scottish economy, and more particularly about its immediate future.

The factors on which its development depends, if one may judge by the range of the topics touched on in this debate, are very wide indeed. We have had speeches touching on the Highlands, the Islands, the European Common Market, the Restrictive Practices Court and an extraordinary range of matters of economic interest. If the range was wide the depth was occasionally also somewhat considerable, as in the case of the speech of the hon. Member for Fife. East (Sir J. Henderson-Stewart). I shall not attempt to say what I had intended to say about his speech because my hon. Friend the Member for Kilmarnock (Mr. Ross) has, I think, given a fairly effective and complete critique of that speech.

However, I must repeat one point which my hon. Friend made about the speeches in general from the other side of the House. It was very impressive, as one listened to speech after speech, to realise how much basic agreement there is about the necessity for Government action in matters of the sort we have been discussing. The noble Lady the Member for Aberdeen, South (Lady Tweedsmuir) began by saying that she did not like the idea, but before she had got half way through her speech she was advocating it in particular cases.

I think there is no doubt that the attitude which characterised business people and other people interested in the economy of Scotland in the 'thirties characterises those people still. We all agree, whatever we may say and however we may put it, that Government action is essential if Scotland's economy is to be healthy. Even the Leader of the Liberal Party, from whom one might expect a fairly considerable degree of adherence to laissez faire, did not by any means stress the laissez-faire point of view.

One of the further references which one may make to the extremely useful paper sent us by the Scottish Council is to say that that paper also stresses the value of Government action along with voluntary action. That is now a pretty well established attitude towards economic questions. It is established almost as a traditional point of view in Scotland now. I think, therefore, whatever phrases one may use about it, one has got to accept in general that Scotland does require positive action by the Government.

It requires, perhaps, a good deal more than that. It is easier to be specific about what the Government may do, should do or must do than it is to be specific about what the private enterprisers, the individual people engaged in industry on a voluntary basis for profit or for a career, should do. But I think that a number of hon. Members opposite may have noticed one or two comments on this matter, so far as it affects Scotland, which were published the other day. I have in front of me the Spectator of 29th May open at an article by Mr. Roy Thomson which has one or two very interesting things to say and from which I propose to quote. When he came to Scotland from Canada he found that Many of the Scottish ways of life and the methods of doing business differed greatly from those with which I had become familiar over my lifetime. The most obvious fact to me was the very considerable reluctance to change. … This theme he repeats more than once in the course of a short article. He puts it very nicely, but I can think of Canadian businessmen who would have said the same thing in somewhat more forceful language. The whole article is polite as befits a visitor to Scotland, a guest, in a sense, of Scotland, writing in a polite journal like the Spectator, except perhaps for its occasional deviations that interest most of us.

Mr. Thomson continues: I am frequently asked, 'Are Scottish businessmen more conservative than Canadians, less willing to throw over old techniques and methods, less flexible in their approach to problems?' I think I would have to say 'Yes' to all these questions. Again, one may think of someone putting that point rather less politely.

He goes on to say by way of a further step in the argument: I think it is most necessary that Scottish businessmen must realise the fact that the world is changing very rapidly and where they have not already done so they must adapt themselves to modern methods and techniques. I need not read any more. Here is a man who came from Canada into a country and an economy which were quite unfamiliar to him, who bought up the national newspaper, who has made himself the television chief of Scotland, and who comments on the other people whom he found in the Scottish industrial scene.

We can talk about Government concern in industry, Government financing, Government co-operation and initiative. We can run them down or praise them. We can be for them or against them, but we have to remember that the other side, the private enterprise side, the individuals in business, are not a sort of constant factor which can be thought of just as "the efficient businessman." There is no doubt at all that the leaders, the owners and managers of business in Scotland are in many respects, and in many cases, open to very severe criticism.

I put that side by side with something else. What has been found by trans-Atlantic visitors, enterprisers and businessmen about the working people in Scotland is exactly and completely the reverse of what Mr. Thomson found about the businessmen. That has certainly been found in Grangemouth, and if I mention Grangemouth it is only because I happen to know a little more at first hand about my own constituency than about anywhere else. But it is true anywhere in Scotland that where a Canadian or American firm is established it has been found that the workers were not reluctant to change and to learn to move into a new kind of thing to do. Canadian and American businessmen found the very opposite—that the workers were extremely adaptable and thoroughly industrious. In one case, of which I know, output has surprised by the way it has exceeded estimates and calculations. That is an important contrast for us to keep in mind.

When we talk about the Scottish economic scene we are not talking simply of something that exists as an idea in our minds or on paper. It is made up of people. I do not say that what Mr. Thomson says in his article necessarily represents 100 per cent. of the truth. I do not say either that the general findings of incoming firms about Scottish workers will yet yield 100 per cent. of the truth. There may well be variations on both sides, but it is true that there are plenty of shortcomings at the top in Scottish industry, and that, by and large, the body of workers is not merely good but is first rate.

It is for this reason that it seems to me particularly unfortunate that we have not managed to do anything like what we should be doing about the training of our workers. The Parliamentary Secretary had something to say about that and I appreciated the tone of his speech. I thought the hon. Gentleman was talking to us in a very friendly way, but I would be less than honest if I did not say that I found a certain lack of policy substance in his speech. It did not seem to me that it added a great deal to the guidance we have so far had from Ministers about the Scottish economy. However, the hon. Gentleman stressed the question of school leavers and of apprentices.

If I may touch on the question of school leavers first, I think the Minister was unduly optimistic about the Scottish side. There has been an improvement since Easter, he says. No doubt, but I have here a notice from his own Ministry showing the number of men, boys, women and girls unemployed at 11th May this year according to regions. It shows that there were 15,000 boys under 18 unemployed in all regions and that the total in Scotland was 3,800. That works out at slightly more than one-quarter in Scotland of the total number, so that when the hon. Gentleman tells us that there has been an improvement since Easter, it does not mean a great deal. The situation about the employment of school leavers in Scotland is still not only bad but, as usual, by comparison with the United Kingdom it is a great deal worse.

On the question of apprenticeship, again I thought the hon. Gentleman might, had he been dealing more fully with the matter, have come down to more hard facts and hard statements of the problems because there is a tremendous amount in the apprenticeship situation which is by no means happy. No doubt he had not sufficient time. The hon. Gentleman simply said that apprenticeship opportunities were not expanding as he would like. That is certainly true in Scotland. They are not expanding as any of us would like, and this is serious, partly because of the difficulty of starting a youngster on a career and partly because of what I have been saying about Mr. Thomson's opinions about managers and, incidentally, because of the opinion of the Leader of the Liberal Party, who found a difficulty in finding managers. We do not train them. We do not bother about them. Our record of day release is very bad. Our apprenticeships do not offer nearly enough opportunities, and we want all the youngsters who leave school and go to work to have a career.

As regards the Government, I think it would be generally true, and certainly in Scotland, that they ought to be tackling this question a great deal harder. The Carr Report is not enough. It is a useful statement of a few general truths, but we need, as one writer in a technical journal put it the other week, to train boys and we need to train them better. I would add that we need to train far more of them, and not only boys but girls also.

With regard to the more general picture, we have in Scotland, according to present figures, a situation to which we are now becoming accustomed. We have high unemployment and lower production compared with the rest of the United Kingdom. When our unemployment figures went up to their peak a few weeks ago, they were the highest that we have had in Scotland since before the war. That was not only in the difficult industrial parts. They were the highest that Falkirk has experienced since before the war.

That is not something to be lightly laughed off, especially when one remembers, as we always do in debates like this, that the people without jobs do not represent everyone who has failed to obtain employment. There are people who have gone away, and there are others who are not on the register and are, therefore, not officially unemployed.

Side by side with that, production is not reaching the level in Scotland that it reaches in the rest of the United Kingdom. Over the last ten years the average increase in industrial production in the United Kingdom has been 38 points compared with 28 points in Scotland.

The problem that we face is not simply that of finding jobs for 95,000 unemployed men, women, boys and girls. The problem is that of trying to build an economy which will increase its industrial production fast enough to absorb in useful productive careers the boys and girls and men and women who are looking for work. The problem can best be solved by looking at the industrial side rather than at the unemployment side.

When one considers unemployment and production from the Scottish point of view and compares them, as one inevitably does, with the United Kingdom, on finding that both unemployment and the rate of growth of production are bad compared with the United Kingdom one is inclined to ask whether it is not necessary to try to follow different policies in the two pants of the economy. That phrase is rather too emphatic. I will not suggest anything like that, but we are all accustomed to modifications and divergencies from the main line of policy for particular Scottish problems. There is no doubt that that is necessary.

A number of hon. Members may have noticed a very useful article in the Scotsman recently by a member of the political economy department of the University of Edinburgh, a man called Veverka—I have not come across his name before, but it does not suggest that he belongs to my clan—who writes a very useful article the general point of which is that the ordinary policies followed with regard to the building up of industry after a recession and the ordinary policies followed in the Budget will bring Scotland back up the steps of employment again simply to the position it held before the movement downwards. Neither the Budget nor the President of the Board of Trade's policies will correct the difference between Scotland and the rest of the United Kingdom. What they will do is to bring the United Kingdom and Scotland, if they are successful, over the recession and back to more normal figures of unemployment and employment.

That is a considerable assumption and I will not try to go into the correctness of it now. One of my hon. Friends has done that. I do not accept the assumption, but if one considers it, it will still leave Scotland with the same lag that it had, say, two years ago, and has had for many years. If one is going to develop Scotland's resources and economy in the same way and to the same degree that one develops the economy of the rest of the United Kingdom, one needs something additional by way of policy for Scotland.

There are many additional things that could be suggested. Many hon. Members, including many hon. Members opposite, have suggested such differentials tonight. I will not try to go into all of them, but the essential thing on which effort should be centred is the potentiality for growth and development and for increasing industrial production in the Scottish economy. The main point on which increased industrial production must rest is the manufacturing industry, and one noted rather gloomily that the Parliamentary Secretary told us that although outdoor employment had improved since the worst of the winter was over there was no sign of improvement in the manufacturing industries.

It is not merely an improvement on the present figures that we require. It is something that will encourage our manufacturing industry to go ahead and expand itself. We must make sure that more investment takes place in Scottish industry—either public or private industry. I leave the public sector aside and concern myself for the moment with private industry. In this respect there is one point that is usually regarded as a sort of side issue when dealing with the Scottish economic picture, but which is of much greater importance than any side issue. Certainly a number of my hon. Friends have been stressing it more and more in recent years. It is the question of research and development, and the connected question of science.

My hon. Friend the Member for Hamilton (Mr. T. Fraser) referred to this. One finds in the White Paper that although Scotland has about 9 per cent. of the workers employed in the United Kingdom, it has only 2.7 per cent. of the workers engaged on research and development. The importance of research and development is not simply that it employs our scientific graduates. In the growth of industry it produces new ideas for projects in which it is possible to invest fresh capital, and on the basis of which it is possible for industry to advance. It is not simply a matter of saying we do not do very well in the matter of research. What we should be saying is that we do not do very well in the matter of research in Scotland, and, in consequence, we do not do very well in the growth of our industries.

This is very important and if the Government rest content with the kind of policies or trends, to use a neutral word—probably I should not use the word "policies" when I am talking about the private sector as well as the public sector—which give us only 2.7 per cent. of the workers engaged in research and development, they will rest content with an economy which is not likely to grow at anything like the same rate as the economy of the United Kingdom as a whole.

The distribution of industry policy, which works itself out rather slowly and which is a policy sometimes difficult to get into effect, as has been said, has to be complemented by a policy of the distribution of research. For the health of Scotland's economy, it will not do to allow the proportion of the national research taking place in the South to continue there. A tremendous amount of research is done with Government funds and under Government enterprise, even that done by private firms.

I will not go into that now, because there is not time, but the reference in the Report to the studentships awarded by the D.S.I.R. shows a quite unsatisfactory proportion for Scotland—as we pointed out in another debate a year ago. It is not just a matter of study. It is not a matter of post-graduate interest and the using of brains, and so on. It is one of the key factors in the development of Scottish industry.

My right hon. Friend the Member for East Stirlingshire (Mr. Woodburn) has received a letter from the Secretary of State which he has passed to me and from which I want to quote some figures to illustrate what is happening about the employment in Scotland of science graduates. I must preface these figures by saying that they are not exact. The Secretary of State explained that in his letter, and one can appreciate the reasons. It is almost impossible to be exact about these things in a short statement. There are many things which one would have to clear out of the way before one could do that.

The first figures I want to give show the percentage of science students from Glasgow University who remained in Scotland after graduating. In pure science the figures were 55 per cent. in 1955; 61 per cent. in 1956; 39 per cent. in 1957; 63 per cent. in 1958. The corresponding figures for engineering were 30 per cent., 36 per cent., 35 per cent., 42 per cent.; for other technologies, 69 per cent., 43 per cent., 39 per cent., 42 per cent.

The figures for the University of Edinburgh are for 1951–56 inclusive. For physics and mathematics they are 35 per cent., for chemistry 33 per cent., for other science courses 41 per cent., and for engineering graduates 32 per cent., so that the figures for Edinburgh University are even worse than those of Glasgow. That suggests that we are not offering employment to our science graduates, our graduates in pure science, engineering and other technological subjects, in any-think like the proportion which we ought to be offering.

I should like to have made one or two comments about the situation in my own constituency, but I have not time to do so. What I would have said about Stirling, Falkirk and Grangemouth would have been almost a reflection of what one would say about Scotland generally. We have our good points and fresh industries and fresh activity in Grange-mouth and we have our difficulties in Falkirk, about which the Government have been far too casual over the years.

However, we hope that with an expanding economy Falkirk and Grange-mouth "will pick up. I hope that in an expanding economy the Government will be a good deal less casual in their attitude towards Scotland than they have been during the periods of difficulty. If, as one assumes from Government policy, expansion is the theme, I hope that Scotland will begin to pick up its proper share of the fruits of expansion in the United Kingdom.

9.30 p.m.

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

I will start what I have to say by congratulating my hon. Friend the Member for Galloway (Mr. Brewis) upon his admirable maiden speech. All hon. Members who were in the House with his predecessor know that on his death we lost a very good friend—I had the privilege of knowing him for all the years that I have been in the House—but all those who heard the hon. Member's maiden speech will feel that he is a worthy successor. As hon. Members opposite have commented, if his speech was non-controversial he produced some interesting ideas. They were not controversial but were constructive suggestions, and he will have some fun in pursuing them in the years ahead. I hope that he will not become too discouraged if I tell him that something which I demanded in my maiden speech took thirteen years to achieve, but it was achieved in the end. It was something which relates to matters with which we are dealing this evening, and I shall refer to it later.

The hon. Member for Stirling and Falkirk Burghs (Mr. Malcolm MacPherson) made a thoughtful and constructive speech, and I thank him for the care with which he approached some of our difficult problems, realising that they are not simple of solution. Just before he sat down he used a moderate word when he talked about the casual way in which the Government had approached some of these problems. For the word "casual", read much stronger and ruder remarks made by earlier speakers. I propose first to deal with the controversial side of the debate and later to try to answer as many as possible of the points raised by individual Members.

I do not think that any Member—certainly none of my colleagues in the Government or myself—believes that the restoration of the status quo is what we should aim for in employment matters in Scotland. We can never rest content when Scottish unemployment figures run consistently at double the Great Britain rate. I say that categorically. I am sure that we are all in agreement upon that. In the period of ten years since the war ended, with times of absolutely full employment—with almost industrial boom conditions at one stage—and then a certain amount of recession, it is disturbing to see the same pattern repeating itself the whole way through, with Scotland's unemployment figure running at double that of Great Britain. That is a matter which no Secretary of State for Scotland and no Government could accept.

There is room for a great deal of argument and dispute whether we are tackling this problem the right way, and whether hon. Members opposite when in power tackled it better than we are doing. There will also be room for dispute in the future as to the best means of dealing with this disparity, but there is agreement on the fact that this disparity exists and must be dealt with.

I want to deal with what the hon. Member for Hamilton (Mr. T. Fraser) said about the relevant figues. He said that this debate was a running event, which happened every year and every month. As far as I am concerned, it happens almost every day with someone or other. Inevitably there must be a good deal of the selective use of figures when the argument becomes highly political, as it is quite properly bound to do. I will try to give some figures which put the matter in its proper perspective—and those figures do not bear out what the hon. Member said when he tried to make out that the Labour Party's implementation of the Distribution of Industry Act was more effective than that of the Conservative Party.

My figures are drawn from Board of Trade statistics, upon which everything that goes into the White Paper is based. In Scotland, between 1945 and 1951, the total amount of factory building approved was about 26.3 million sq. ft. Between 1952 and 1958 the figure was 27.9 million sq. ft., which is not very different.

Dr. Dickson Mabon

That is not the point.

Mr. Maclay

I have not reached the point. I am trying to put the matter into perspective. From 1945 to 1948—mark the years because they are very important—Scotland's share of Great Britain's total was 13.8 per cent. I give that to hon. Members opposite. From 1949 to 1951—a very important two years—the figure was 6.6 per cent., and from 1952 to 1958 it was 6.8 per cent. My charge against hon. Members opposite is that they did not take anything like enough advantage of those years immediately after the war, when any industry which could possibly get a roof over its head would go to where it could get that roof.

That was the subject of my maiden speech and I thought then and for many years afterwards that the Distribution of Industry Act itself was drawn too narrowly. We concentrated excessively on the old distressed areas, as they were then known, and did not give enough consideration at that time to areas outside the Development Areas. It is only in the last year or so that we have really got down to that through D.A.T.A.C. In the three years after the war, hon. Members opposite undoubtedly achieved a bigger proportion, but in the years when things began to return to anything like normal the figures were down to 6.6 per cent., as the Scottish proportion.

Mr. T. Fraser

Is not the right hon. Gentleman guilty of the worst kind of selectivity? Is he not dealing with the factories approved when we had so many factories under construction that there was no point in adding to the approvals? Will he not agree that I am right in saying that when we take the factories completed every year from 1945 to 1951 we had 12.2 per cent. of all the factories completed in Britain?

Mr. Maclay

I have given the basis of my figures, and I said that there was bound to be selection; one cannot help it. There are all sorts of different bases on which we can take this thing. If we are to have this argument of who has done best, I would say that neither side has done as well as it should have. I should like to see more done.

Miss Herbison

We have done much better.

Mr. Maclay

I do not accept for a minute that the Labour Party's record was any better than ours. [Interruption.] I am going to keep on this. The hon. Lady keeps on saying, "much better". She must realise that in the years immediately after the war it was extremely easy to persuade industry to go almost anywhere in the country. I know that to be so because I was working on this problem at the time.

Mr. Malcolm MacPherson

Where?

Mr. Maclay

As a local Member, and I worked very hard indeed. I had a lot of help from the Board of Trade in those days in my area in Scotland, and I know what happened. One found when one wrote to an industry that the first thing it asked was not about the problems and difficulties of going anywhere. It asked, "Is there a roof available and how quickly can we have it?" It was willing to go anywhere where there was a roof available. The position got progressively more difficult, and that is reflected in the approval figures which I have given, which show the number of people coming forward. [Interruption.] Hon. Members must rake this. We had a political start to this debate and I am going on with it for a bit.

Dr. Dickson Mabon

The right hon. Gentleman mentioned a comparison on a cash basis. He may recollect a speech made by the Parliamentary Secretary to the Board of Trade not long ago, which I quoted in our last debate on Development Areas. Is the right hon. Gentleman taking that comparison, where we had an average of £7 million spent each year compared with the average of the present Government of £4.6 million?

Mr. Maclay

I have some figures here regarding the cash basis, but I have not got them ready and I will not go further into the figures now. I will examine them and, if necessary, I will write to the hon. Member about them.

I wish to refer now to what has happened more recently. What has happened in 1958?

Mr. Lawson

Nothing.

Mr. Maclay

Yes, quite a lot has happened. In 1958, when things were beginning to get difficult—

Mr. T. Fraser

They were beginning to get better, according to the President of the Board of Trade.

Mr. Maclay

During the first part of the year the position did deteriorate. In that year the level of industrial expansion showed that approvals for industrial building declined by approximately 25 per cent. in Great Britain as a whole compared with 1957, but Scotland maintained the level of 1957 with a figure of 3.9 million sq. ft. compared with 4 million sq. ft. in the previous year.

There is another point which needs clarifying. Compared with Great Britain as a whole, Scotland's share in 1957 was 6.1 per cent., rising to 8.7 per cent. in 1958, and the first quarter of 1959 shows a further increase to 10.9 per cent. But that is only one quarter, and I do not attach too much importance to that figure because these things even themselves out.

Another point I should like to clarify is that from the beginning of the year up to mid-May of this year a further 2¼ million sq. ft. of factory space, with an estimated employment potential of nearly 3,400, has been approved. I agree that we can do almost anything with figures—

Mr. T. Fraser

The right hon. Gentleman has proved that.

Mr. Maclay

—and so can the hon. Member. I have met him on his own ground.

Things are happening, and it is wrong to pretend that they are not. What have we been doing on the legislative side? I am now going back over old ground and referring to things which are already known but which I think should be realised more clearly. Regarding Scotland before 1958, because of the financial position of the country, the balance of payments problem and everything else, there was a substantial clamping down—there had to be—on Government financing of factories. In that time there were conversions and approvals for factories to be built in Scotland when there were no factories built anywhere else. Then there came the Distribution of Industry (Industrial Finance) Act. It has become fashionable to laugh at that Measure, but I think it is far too soon to laugh about it. I have been rather disappointed by some of the early results, but from what I am about to say it will be appreciated that it may be too soon to laugh at that Act. Things are beginning to happen, as more people appreciate the provisions of the Act and how to use them.

It may be that hon. Members opposite do not remember what may be done under the Act. It is designed not only to widen the kind of assistance which can be given inside Development Areas but outside as well. There are facilities for loans for the purchase of premises and plant and for working capital, and grants towards initial expenses, work on the clearing of factory sites and the building of approach roads or the training of workers. In Scotland the areas which have benefited from the facilities include Dundee, Lanarkshire and Greenock, the Highlands, north-west Ayrshire, Arbroath and Stranraer. Equivalent areas in England are Merseyside, North-East Lancashire and South-West Wales.

Sections 3 and 5 of the 1945 Act have been revised to make grants or loans to improve water and sewerage services in Development Areas and to assist with the rehabilitation of derelict sites. I am repeating things which should be known by everyone. What has been happening?

Mr. Hannan

Nothing.

Mr. Maclay

Up to 1st June—these are the latest figures available—there have been 92 firm and eligible applica- tions from Scotland; 52 from the Highlands and Islands; 21 from the North-East area; and 19 from the West and South-West. Twenty applications have been recommended at a total value of £743,520, 64 are still under consideration and eight have been rejected. That is a substantial improvement.

Mr. Hannan

How many jobs?

Mr. Maclay

One cannot give that figure for these D.A.T.A.C. applications because at this stage it is impossible to know.

Mr. Ross

Will the right hon. Gentleman give us the location of the twenty recommended applications to which he referred?

Mr. Maclay

That would take too long. I can do so later.

In addition, since the revival of the 1945 Act D.A.T.A.C. powers in 1958, three Scottish applications in the Development Areas, totalling £1,829,000, have been recommended; I admit that one is a very big one. It is nonsense to talk as if we have been doing nothing in the last eighteen months. A great deal has been done and is being done. As the possibilities are more widely realised a great deal more will be done, particularly under the provisions of Sections 3 and 5 of the 1945 Act. Proposals under Section 3 for water and sewerage schemes have been received mainly from the Lanarkshire and Clydeside areas ranging from a few thousand pounds to £3 million.

These proposals are at present under consideration. None of them has gone through yet. There is bound to be delay, because it is not easy to get the figures out—[Interruption.]—I am pointing out the action that we have taken and which is beginning to show results. There have been approvals in some cases and not in others. One derelict factory scheme has been approved. [An HON. MEMBER: "Where?"] It is on the site of the Summerlee Iron Works in Coatbridge. That has been approved.

On factory development I can say one word more. It is worth getting these facts clear. In the period beginning January, 1958, to the end of May, 1959, industrial development certificates have been issued for 191 projects in Scotland for a total area of 6,651,000 square feet. According to the employers' estimates these new factory extensions should provide jobs for 8,320 workers.—[Interruption.]—These words are carefully chosen and if any hon. Member wants to challenge them he should read them in HANSARD tomorrow and then ask me questions about them. Eighteen of the 191 factory extensions, with an employment potential of 2,636, are being built by the Government.

Mr. Lawson

Is it not a fact that employers in matters of this kind usually think of a number and double it?

Mr. Maclay

Not in my experience. One has to give these figures with reserve. Until a factory develops no one can be quite certain what the employment factor will be. I make no apology for giving all these figures because it is important to realise that things are being done. From speeches made by the Opposition, although most of them were in very moderate terms, one would get the impression that nothing whatsoever was happening. That is far from true. We have to go on trying to find the best means of getting more and more light consumer industries into Scotland. We shall certainly go on doing everything in our power. I hope that we shall have the help of all hon. Members because they can help enormously through their work with local authorities and with industrialists in their constituencies. This is a job that we have all to be working on, and not simply the Government, or individuals.

Mr. Malcolm MacMillan

Is the Secretary of State aware that the Economic Secretary to the Treasury, replying to a Question of mine on 14th May, said that the total amount of annual grant aid under the Distribution of Industry Act, 1958, for the Highlands and Islands had been £7,750? What has the grant aid been for new industries in other parts of Scotland?

Mr. Maclay

I should not like to hazard a guess on that but I will find out and will let the hon. Member know.

The right hon. Member for Dundee, West (Mr Strachey) was very ungracious in his references to what has happened in that town. It was preposterous to imply, as he did in his speech, that nothing was: happening and that everybody was sitting back watching a desperate situation develop.

Here are the facts about Dundee. In regard to Government factories, since January, 1957, 82,000 square feet of factory space has been completed. I admit that that only produced 180 jobs, but at present under construction are 443,000 square feet, with an estimated 1,805 jobs. In addition, 200,000 square feet have been approved but not yet started. The total number of jobs out of these three categories amounts to between 2,600 and 2,700. That is not a case of nothing happening. As the right hon. Gentleman himself must know, the most sustained efforts are being made by everybody concerned, including the local authority of Dundee, to encourage industry to go to that town. Of course, these figures could be better but they show very real progress and it is a pity that the right hon. Gentleman left the impression that nothing at all was being done.

Mr. Strachey

The impression which I endeavoured to give, and which I now repeat, is that whatever is being done is quite inadequate to prevent a steady and cumulative increase of unemployment in Dundee. That is what matters. As long as that is the case, I Shall endeavour very strongly to give that impression to the utmost of my powers, because it is vital to do so.

Mr. Maclay

It may be vital to do what any hon. Member has a duty to do, namely to keep on pointing out the needs of his constituency, but it is not right to say that nothing has been done when, in fact, something has been done. Of course, we should like to see more, and everybody is trying to get something done.

Mr. Strachey

But the position is worse.

Mr. Maclay

In Dundee, as the right hon. Gentleman knows, the figures fluctuate. Indeed, at one time they moved against the trend.

Several Hon. Members rose—

Mr. Maclay

I shall have to keep moving quickly if I am to deal with all the points that have been made. A number of hon. Members touched on the question of advance factories. We are building this famous factory in Scotland—[HON. MEMBERS: "One factory."] Let me remind hon. Members of something they should know. There are six factories at Hillington, one at Chapelhall, one at Carfin, one at Dundee and one at Craigton—all factories belonging to Scottish Industrial Estates—lying empty.

Mr. Hamilton

Tory freedom.

Mr. Maclay

There are ten factories which are empty at the moment, and in addition there are eleven Government buildings. I would not say that all of them are ideal factories by any means, but there are 11 empty, and 40 privately-owned factories in different parts of Scotland on the books of the Board of Trade. There is no party point in this question. There are possibilities in advance factories, but it is hard to argue that they are the answer to everything when we have available in industrial estates ten suitable factories of the type which would be built if there were advance factories.

Time is running out a bit too quickly. There is an important point about the rents of factories, but I shall have to leave that for the moment because I wish to say something about the speech of my hon. Friend the Member for Fife, East (Sir J. Henderson-Stewart) and his suggestion that something more is needed than the Scottish Council is able to do. That point was dealt with also by my hon. Friend the Member for Caithness and Sutherland (Sir D. Robertson). I am sorry that I missed half of my hon. Friend's speech, but I have been told what he said.

What my hon. Friend suggested seemed to me to be a duplication of what we have now got in the Scottish Council (Development and Industry). I may have misunderstood him, and I should be glad to discuss this proposal with my hon. Friend later. There is a grave danger of our getting the feeling that duplication of bodies can help. That is what I would say about the proposal for a Highland development board which was touched on by the hon. Member for Orkney and Shetland (Mr. Grimond) and my hon. Friend the Member for Caithness and Sutherland. We already have a large number of bodies dealing with various aspects of Highland life. Some people would argue that there are too many, that they overlap and that they ought to be put under one hat. I think that is precisely what is being argued by some people.

The hon. Member for Orkney and Shetland made a positive proposal about the two fish boards. The Fleck Committee is sitting, and we must await the result of its deliberations before we come to conclusions. If all these bodies were to be pulled under one hat, or whatever simile one may like to suggest, they would very quickly have to be subdivided again because each part has clear and specific functions of its own.

My mind is never closed to any possibility which might help, but I am not convinced that some kind of Highland development board—whatever it might be called—would have any more effect than the really effective existing bodies. I agree with my hon. Friend the Member for Caithness and Sutherland that no one has been successful in encouraging a proper movement of industry into the Highlands, but I think that he will agree that it is a problem with very great difficulties. I myself have studied all the proposals with the greatest sympathy and care, but I cannot see how another body can be an answer to the problem. The real need is to make certain that the facilities which are available to get industry going in the Highlands are fully understood, and to find more effective means for encouraging people to take advantage of these facilities. This is a matter I am studying very closely at the moment, and I hope to have something to say to the House and to Scottish Members about it before very long.

Miss Herbison rose—

Mr. Maclay

There is really very little time.

Miss Herbison

I know there is, and that is why I am very worried. Is not the Secretary of State aware that one of the very greatest problems in Scotland now is the crisis in the coal industry and what is happening in Lanarkshire? Will he not say a word on such grave matters?

Mr. Maclay

There is a vast number of subjects to cover—

Miss Herbison

This is a very important one.

Mr. Maclay

I know it is, and I am trying to cover as many as I can. The coal industry has been discussed fairly fully, and undoubtedly it will be discussed again. I gather that it is the wish of hon. Members opposite that this should not necessarily be the last day of debate devoted to industry in Scotland.

Miss Herbison

Pits are closing now.

Mr. Maclay

If hon. Members want to divert me from something they do not like, I will be diverted. As the hon. Lady appreciates, these pits are being worked to a programme. Discussions go on between the Coal Board and the unions—

Miss Herbison

No; discussions do not go on. That is one of the difficulties.

Mr. Maclay

—as to what is to happen to the men involved and everybody is conscious of the grave problems. I have many figures with me showing the detail of what has happened to men who are out of work because of the closure of pits. I will certainly send the information to the hon. Lady or it can be discussed on a later occasion. I am not ignoring the importance of the problem, but it is really outside the range of what I am trying to cover in the last few minutes.

As regards rents for factories on the Northern Ireland model, it is said that we ought to have a policy of very much lower rents for factories built in Scotland. The economic rent of the type of factory in Scotland which we are discussing is probably about 4s. 9d. or 5s. per sq. ft. At present, the level of rents for new standard factories in the various Development Areas ranges from about 2s. 3d. to 3s. 3d. a sq. ft., a long way below the economic rent. Is that a sufficient inducement, an inducement of any value at all? All I can say is that the rents at which factories can be taken privately in the South are about 8s. 6d. or 9s. per sq. ft. in London and about 5s. in the Home Counties. We are not, I think, subsidising rents as heavily as in Northern Ireland, but we are producing a figure which gives a very competitive rent compared with factories in the South. I say that only to put the matter into perspective. There is room for argument as to what is the right level of rents for these factories, but that is the perspective in which the matter should be viewed.

There are many more things I should like to discuss. I have material here for about two hours, but it seemed right that the maximum number of back benchers who wished to speak should be able to say what they had in mind.

Before I ask leave to withdraw the Motion, I should like to repeat what I said earlier. We are all after the same objective. We are bound to argue about whose methods are best and what are the right methods. If we have confidence in the future of Scotland, we must not get into the habit, either in the Opposition or Government—if some of us ever will be in opposition—of decrying Scotland and decrying what is being done.

I beg to ask leave to withdraw the Motion.

Motion, by leave, withdrawn.