DEVELOPMENT AREAS (POLICY)

HC Deb 14 May 1959 vol 605 cc1461-557

5.15 p.m.

The Parliamentary Secretary to the Board of Trade (Mr. John Rodgers)

I am sure that all Members of the House are grateful to the hon. Gentleman the Member for Abertillery (The Rev. LI. Williams) for using his good luck in the Ballot for Motions to introduce the subject of the Development Areas. I believe that, important though general debates are on the subject of unemployment, perhaps in the next few months—it may even be years—the question of local unemployment will assume more importance than the general overall employment debates, and therefore we owe him a debt of gratitude for allowing us to ventilate it today.

At the same time, I congratulate the hon. Gentleman most sincerely on the eloquent, moving and sincere way in which he moved his Amendment. If I may say so without patronage, I found it extremely helpful and objective in its outlook. His suggestion that the time had come when one or two areas might be do-scheduled was interesting coming from the opposite side of the House. It is one we ourselves have often considered but so far have rejected, but it has by no means been neglected and it would be interesting in the course of today's debate to hear the views of others on whether the time has come when we might help areas as much by de-scheduling as we hope to help them when they are scheduled. Conversely, by the same argument, if by de-scheduling we help other areas, the hon. Gentleman stands convicted out of his own mouth in that his demand for more and more areas to be scheduled will not help those already scheduled. I will not debate this at great length, but it could be argued either way.

I hope I shall not raise the temperature of the House, or be accused of introducing party politics, if I say that the hon. Gentleman's historical survey of the steps taken by various Governments to deal with the question of local unemployment was perhaps a little less than fair to the part played by the Conservative Administration in the location of industry policy and in the creation of Development Areas. What are the facts? The policy was initiated before the war by the National Government, which was predominantly Conservative, with the passing of three Acts specially to deal with the problem of the distressed areas, as they were then called. These were the Special Areas (Development and Improvement) Act. 1934, the Special Areas Reconstruction Act, 1936, and the Special Areas (Amendment) Act, 1937. In addition to the establishment of trading estates under these Acts, the revival of heavy industries in the distressed areas was assisted by the placing of contracts by the Service Departments between 1936 and 1939.

As the hon. Gentleman himself said, as a result of the policies which Conservative Governments initiated in those years, the number of unemployed in the special areas halved between 1931 and the outbreak of the war in 1939. A landmark, as he said, was reached with the publication of the White Paper issued by the Coalition Government in 1944. Not only did that White Paper signpost the way, we hoped, to full employment and the prevention of any possibility of a return to the conditions we knew in the 'thirties, but it also endorsed the Conservative policy of providing loans for commercially sound enterprises in what we now call the Development Areas. The Distribution of Industry Act, 1945, was based on that White Paper.

To be fair—I was accused last time we debated this subject of not being quite fair—the Act was introduced by the Coalition Government and some credit should be given to the right hon. Gentleman the Member for Bishop Auckland (Mr. Dalton) for the part he played. But to be equally fair, the right hon. Gentleman might give credit to the Conservative Caretaker Government which actually passed the Bill. All I tried to suggest was that both sides can take some credit for the present position of our location of industry policy and for the policies we are both trying to pursue. If we have an argument, it is on the question of emphasis and vigour and not on the fundamental policy of the location of industry or the steering of firms.

Mr. Douglas Jay (Battersea, North)

To get the record straight, the Bill was three-quarters of the way through its Committee stage in this House when the Coalition Government handed over to the Caretaker Government.

Mr. Rodgers

I thank the right hon. Gentleman very much.

By the time we came to 1958 there were many places outside the scheduled Development Areas where there was worse unemployment than in the Development Areas. It was for this reason that the Conservative Government introduced the Distribution of Industry (Industrial Finance) Act, 1958, in order to provide a mechanism for giving help where it was most needed. In other words, the Conservatives introduced in the early days a new conception. I think I ought to be allowed here to claim credit for this. It was not enough for Governments to alleviate the individual hardship which fell to people unemployed. They recognised that the Government had an active part to play in the creation of employment and particularly in trying to locate it in areas where people would otherwise suffer through no fault of their own.

In the last few months the Government have taken a great many steps to reflate the economy and to try to create a general background of further employment which should make the steering of industry more easy than it has been in the past. The experience which I have had since being at the Board of Trade has shown me that at a time when there are fewer industries on the move it is more difficult to steer them to Development Areas. Therefore, it is essential that the location of industry policy should be pursued just as vigorously, if not more vigorously, in times of industrial expansion than in times when unemployment figures are high.

The long-term difficulties of these areas will not be solved except by a policy—whichever Government are in power—of steering industry, and it is much easier when industry is expanding and when there are parts of firms which can be hived off or whole industries which can be steered into the Development Areas.

I do not think that I can accept what I believe to be the misleading oversimplification of the problem, of the remedies and of the solutions stated in the right hon. Gentleman's pamphlet on unemployment. On page 2 of his report he claims that the Socialists had nearly solved, once and for all, the problem of the special areas by 1951. Socialist policy had nearly put an end to the menace of unemployment in the Development Areas. I think this is really an over-simplification of the problem.

Has the unemployment problem nothing to do with the export position and with the credit worthiness of the country? Had Dundee ceased in 1951 to be largely dependent on jute? Had Tyneside ceased to be dependent on shipbuilding? Had the Welsh valleys ceased to be dependent on the hand tinplate mills? Were there no happenings in agriculture whereby output was going up with a depleted labour force? I think the right hon. Gentleman was being what he accuses us of being, complacent, when he suggested that by 1951 the Labour Government had practically solved, once and for all the problem of unemployment in the Development Areas.

Mr. Jay

I apologise for interrupting the hon. Gentleman, but since he quotes me, I would point out that obviously the implication of that was if the policy had been vigorously continued.

Mr. Rodgers

We will come to that.

Of course, unemployment was only a fraction of what it had been in the 1930s, but this was true all over the country. It is significant, but it was not in the right hon. Gentleman's report, that unemployment in the Development Areas has remained consistently about double that of the rest of Great Britain, whether the rate of unemployment was high or low.

If I may be critical of the hon. Gentleman who moved the Amendment in so distinguished a way, I thought that he was a little unfair, too, in quoting the figures that he alleged proved our failure to deal with the unemployment situation in the Development Areas. It is true that it is 4.5 per cent. in the Development Areas as against 2.4 in the rest of the country, but it was twice_ as high in all the seven years of the Socialist Government except in 1947. There is really very little difference between us on the record in this field. The more that I visit the Development Areas the more I am sure that it is a very difficult problem. It is futile to try to score debating points by selecting figures. The difference in the ratios of unemployment in the Development Areas as compared with the rest of the country was 2.2 to one under the Socialists while ours is 1.8 to one. So, if anything, we have brought about an improvement in the ratios. I do not want to let go the accusation which the hon. Gentleman made that we had failed in this record.

Mr. George Lawson (Motherwell)

Will the hon. Gentleman bear in mind that there is also the factor of the very rapid growth in some parts of the country and no growth in others? That should be kept in mind. Scotland, for example, has been nearly static in population whereas the population of the Midlands has gone up very much indeed.

Mr. Rodgers

I am very well aware of that point.

I am convinced from my visits up and down the country that one of the reasons for the unemployment in the Development Areas is the technological changes which were bound to happen—and will go on happening—no matter what party was in office. The decline of the extractive industries in Cornwall, the substitution of paper bags for jute sacks, which affects Dundee, the gradual contraction of the cotton industry, particularly in Lancashire and the closing of the South Wales hand tinplate industry and many other changes were inevitable. Indeed, no Government could seek to frustrate these technological changes.

We cannot afford to act as an industrial Canute saying to the technological changes, "Thus far and no further."

Mr. Percy Collick (Birkenhead)

No one would, of course, dispute what the hon. Gentleman is now saying, but what he seems to fail to understand, as I see it, is that the criticism which comes from this side of the House against the Government's policy is due to the fact that they have failed in the direction of industry policy at this time in allowing industrial establishments to sprout up all over the country rather than see to it that they are developed in the Development Areas.

Mr. Rodgers

I am coming to that point a little later about the use of the industrial development certificate as a weapon for steering industry.

I would correct one thing which the hon. Gentleman may have said inadvertently in his intervention. He used the word "direct". We have no power to direct industry or to seek to do so, and I do not think that hon. Gentlemen opposite would really want at this time, in what is still a free enterprise system, to see powers given to the Government to direct firms. We must use powers of persuasion and inducement, as the hon. Gentleman mentioned when he moved the Motion.

Mr. Collick

I used the word "direct", but I am sure the hon. Gentleman understands, as I do, that if the Government make up their mind that industry is to go into the Development Areas that is where it will go.

Mr. Rodgers

I am coming to that point as I develop my argument.

Mr. William Ross (Kilmarnock)

No one accuses the hon. Gentleman of being like King Canute. We think that he is more like Ethelred the Unready.

Mr. Rodgers

I am sorry that I gave way to enable the hon. Gentleman to make that unworthy intervention.

Mr. F. H. Hayman (Falmouth and Camborne)

Will the hon. Gentleman—

Mr. Rodgers

I am sorry that I cannot give way to the hon. Gentleman, but I have been interrupted five times in the last five minutes.

I want to point out that the Development Areas are as much dependent on the export trade of the country and probably even more dependent than is the rest of the country. They would be much more affected than would London, Birmingham and the Midlands if we were priced out of the export markets. I am sure that all of us have been heartened by the April figures. The measures Which we have taken generally throughout the country, and which are reflected to some extent in the Development Areas, and the policy which we have been pursuing, which has kept prices steady and led to better employment figures, show that we are the guardians and not the assassins of full employment as we were once accused of being by hon. Gentlemen opposite.

Today my right hon. Friend the Minister of Labour and National Service has published figures up to the end of March of the actual number of people in employment as opposed to those unemployed. Some commentators, I see-- and this point may be raised in the course of the debate—have assumed that only 1,000 in the total is a disappointing increase. However, I should like to point out that there is usually a decrease in jobs between February and March. For example, in the same month last year, there was a drop of 19,000, and in 1957 one of 16,000. Indeed, today's employment figures are the first for a year and a half which have shown a positive improvement over the usual change for the time of the year. The improvement in the trend which we noted in the unemployment figures has now been continued in the positive employment figures. Finally, another good indication, the drop of 16,000 in the number on short time brings the total for short time lower than it was in March last year.

Now I should like to deal with the points raised by the hon. Member for Abertillery in his very effective speech in regard to the powers that we have to try to steer industry. There are two powers, the positive power and the negative power. There is positive power under the Distribution of Industry Acts to build factories, to help firms with grants and loans to secure the necessary capital for building their own factories or in providing equipment. There are also grants to facilitate industrial development by the clearance of derelict sites and the provision of basic services. Secondly, there is the negative power under the Town and Country Planning Act introduced by the right hon. Gentleman's Government in 1947, to refuse industrial development certificates which are required for any industrial building of over 5,000 square feet. I should like to deal with each of these in turn.

To deal with the positive side of our policy first, may I say that it has often been urged from the benches opposite that the Government should spend more money in order to provide more jobs in Development Areas, and we are at one with the party opposite in wanting to create the jobs. It is always possible to think of ways of spending the taxpayers' money which might bring the creation of more new permanent jobs, but one has to bear in mind two limitations.

The first essential is that we have to have some system of priorities designed to help the worst places. If we are prepared to help anywhere which has some unemployment, and even, as the hon. Member who seconded the Amendment suggested, areas where unemployment is threatened though not actual, we shall not be able to concentrate on the worst places. I should like to refer to this matter, to which refernce was made by the hon. Member for Greenock (Dr. Dickson Mabon), a little later on.

Secondly, hon. Members will not expect the Government to spend money without regard to the soundness of the particular project in the long run. To load up the Development Areas with bankrupt businesses would do the Development Areas more harm than good. Therefore, we must give some attention to the viability or soundness of the particular concern. The chief power we have to create employment, as the hon. Gentleman pointed out, is to build factories, and we are using those powers in those places where unemployment is most serious. We believe these places are Dundee, Greenock North Lanarkshire, West South Wales, North-East Lancashire and Merseyside, and we would not hesitate far a moment if the situation worsened elsewhere in Development Areas to build there. This whole policy is not a rigid one. This is an administrative act, which we are constantly keeping under review.

Mr. Patrick Maitland (Lanark)

Before my hon. Friend leaves that point, could he go a little further and say what his view is about those places—he knows that I have one in mind at the moment—which may be only a few miles outside a D. A. T. A. C. area, now defined as areas of high and persistent unemployment? If it is the case, as some of us always seem to be seeking to persuade him, that there are places just outside the strict limits of the areas, as now defined, where employment could be created of a kind to relieve unemployment within the area in question, will he consider these places for D. A. T. A. C. help?

Mr. Rodgers

As I informed the hon. Gentleman at Question Time, in the 1958 Act it is explicitly stated that factories situated just outside a D. A. T. A. C. area which would draw labour from the D. A. T. A. C. area would qualify for D. A. T. A. C. assistance, and therefore firms can make application if it can be shown that they will draw their labour from the D. A. T. A. C. area.

Mr. Maitland

Will my hon. Friend clear up the point a little further? He and a number of his colleagues have recently written to me saying that they would not qualify for assistance under the powers of the 1945 Act.

Mr. Rodgers

I think there is some confusion on the part of my hon. Friend about the powers which we have under the 1945 Act and under the 1958 Act. My answer is that they would qualify for consideration for assistance under the 1958 Act but not under the 1945 Act. However, I must press on, because there are other hon. Members who wish to speak.

Because we want projects to be sound when going into Development Areas, we believe it to be a better long-term policy, bearing in mind the needs of the Development Areas, to build factories for firms which have a definite project in mind and which have definitely expressed a desire for a factory. This is really the thought behind our present factory-building programme. There are at present twenty-eight empty factories in the Development Areas, and all these have been built with the taxpayers' money. We believe that it is prudent to provide further premises by new building only in cases where long-term occupation can be assured.

We are, however, as the hon. Member for Greenock said, operating on an experimental basis, under pressure from certain quarters; and, as a gesture of faith, we are building three advance factories. The value of further speculative building must be judged in the light of the result of that experiment. If we find that factories in a particular area are claimed before construction, we shall review the situation in the light of that fact. I should like hon. and right hon. Gentlemen opposite to believe me when I say that we are sincere in giving our reasons why it is better to build factories for firms which want them and are able to use them successfully.

We have had some noteworthy successes in our policy, and reference was made by the hon. Member for Abertillery to the Pressed Steel factory at Swansea, which is magnificent. I could give other examples of the way in which we steer big firms into these areas by building factories for them or allowing them to build there.

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

What is "advance" about an advance factory in Coatbridge which has been snapped up even before it has got on to the drawing board? Does this not show the shabby nature of the experiment which the Government are conducting in advance factories?

Mr. Rodgers

I was in Coatbridge ten days ago and it had not been snapped up then. I understand from my right hon. Friend the Secretary of State for Scotland that it has not been snapped up. but I shall be delighted if the hon. Gentleman's information is correct. I have not got that information at the moment.

New factories are now under construction or approved to an aggregate of 3½ million sq. ft., and will cost about £10 million. The potential new employment from these factories will be, by the end of this year, 6,000 jobs, rising to 11,000 by the end of 1960, and to 17,000 by the end of 1965. I agree that the power to build factories has been one of our most important instruments for achieving our location of industry policy, but it is by no means the only one. Reference was made to the Government's powers under Section 3 of the 1945 Act to make grants or loans to improve basic services in Development Areas, and under Section 5 to make grants to local authorities to clear derelict sites. My right hon. Friend the Minister of Housing and Local Government, who is also Minister for Welsh Affairs, who will wind up the debate later on, will say something about the steps which his Department is taking with regard to these powers.

In regard to the clearance of derelict areas, as hon. Gentlemen know, a circular was sent out by my right hon. Friends the Minister of Housing and Local Government and the Secretary of State for Scotland to local authorities inviting them to put forward schemes for the rehabilitation of derelict sites, and also for water and sewerage schemes coming under Section 3. So far, over fifty projects for work on derelict sites are being discussed by our regional controllers with the authorities concerned. Formal applications in respect of ten of these have reached the Board of Trade headquarters within the last week and are being dealt with as a matter of urgency. I hope that a number of them will go ahead, but hon. Members will recognise that on this matter we are strictly limited by the wording of the Act. The land must be derelict, which means that it must be ownerless or abandoned.

For example, we have not the power to make grants for clearing dilapidated buildings; they can be made only in respect of land which is ownerless and for which the owner has no further use.

The other important power the Government have under the Distribution of Industry Act—

Mr. Fernyhough

What if a local authority held the land, having bought it a long while ago? Would the local authority act in these circumstances?

Mr. Rodgers

If the hon. Gentleman wants an authoritative answer to that question, it would be better if he put it to the Minister of Housing and Local Government.

Mr. Jay

Is the hon. Gentleman right in saying that the land has to be owner-less to qualify? Surely the term in the Act is "derelict". I have never heard it argued that to be derelict it has to be ownerless. If so, how can the greater part of land ever qualify?

Mr. Rodgers

I am not a lawyer, and the intricacies of the law sometimes baffle me. Reference was made to the Coatbridge Canal. This matter is held up by such a legal point as this, which is now with the lawyers. It turns on the question of what is a derelict site. It has to be ownerless or abandoned.

Mr. Jay

Ownerless or abandoned?

Mr. Rodgers

Yes, that is so. I am sorry if I said "and" when I meant "or ". I have not a legalistic mind.

The other important power which the Government have under the Distribution of Industry Act, 1958, is that of giving financial assistance to firms setting up or extending in places of high unemployment. The importance of this power is that it is the only one which is available outside the scheduled Development Areas. It allows us to give help to areas outside the Development Areas where the unemployment figures are, unfortunately, above the national average. It is also the only one which can be used—this also is an advantage—for non-industrial undertakings such as hotels or office buildings.

As my hon. Friend the Economic Secretary told the House recently, since the Act of 1958 came into force last July many hundreds of preliminary letters have been received, and a total of 272 firm and eligible applications for assistance have been accepted by D. A. T. A. C., and since then another six have come in. Of these cases, 38 have been approved and a further 201 are currently under consideration. The total assistance offered by the Treasury in the successful cases exceeds £1 million, and it is estimated that the assistance offered should provide new jobs for 1,700 workers.

Many hon. Members may think—this has been said—that this is a very disappointing figure after nine months of the working of this Act. There is a good deal to be said for that view. But it must be remembered that these are new jobs, not just extensions of factories, and they are in the main in places to which industry has shown itself extremely reluctant to move, such as Cornwall and the Highlands and Islands of Scotland, places where the major D. A. T. A. C. assistance has not gone.

We must remember that at the end of last July, when the Act was passed, we were only just moving out of a mild recession, and it took some months for people to understand what the facilities available under D. A. T. A. C. were. That is why I sent out my letter and a little pamphlet to 50,000 firms.

The hon. Member for Greenock did not actually refer to the Inchgreen Investigating Company which has applied for assistance to D. A. T. A. C. in the construction of a large graving dock at Greenock, but I should like to. While normally I would not refer to applications to D. A. T. A. C. but would regard them as confidential, in this case the firm itself has made its application public, although it has not made the precise terms known. I can, consequently, say that the matter is very much in our minds at the moment. It is being considered by the D. A. T. A. C. Committee. We are very well aware of the importance that the project has for Greenock.

The hon. Member for Greenock was less than fair about what we have tried to do for his area, quite apart from Acme, I.B.M. or Playtex, all of which we have helped to develop in his area, and which have provided 1,700 jobs. The Socialist Party was no more successful than we have been at Greenock when it was in office; in fact, it was slightly less successful.

I say from the bottom of my heart that if could get this local unemployment problem out of party politics, no one would be more pleased than I should be. It goes against the grain when I have to keep defending what we have done. This arises largely because of accusations from the other side of the House that we have not done enough or that we do not really care about the problem. Both of those accusations are untrue. Between 1945 and 1951 new factory building for Greenock, private and Government-financed together, provided only 1,200 jobs. The comparable figure from 1952 until now is 1,400 jobs. Neither record is good, and much more has to be done. We are redoubling our efforts. The hon. Gentleman is not justified in saying that we have failed and that the Socialists succeeded. I do not think either party has yet succeeded in regard to Greenock.

Dr. Dickson Mabon

The hon. Gentleman is not being at all fair. I do not want to argue solely on the basis of my own constituency, but the figures from 1952 include the introduction of I.B.M. to Greenock, which was very largely the result of the efforts of the Labour Government in the preceding years. This shows how figures can mislead people about the performances of both parties.

Mr. Rodgers

I grant the hon. Member that point, but perhaps he will grant that Acme will produce hundreds more jobs.

I would confirm that all Departments and the Committee recognise the importance of taking all the steps that we can to bring employment to the Development Areas.

I should like to say a word about the applications that have been made for assistance under the D. A. T. A. C. scheme. We have had about 160 from England, 80 from Scotland and 40 from Wales. The Scots have had the highest number and proportion of approvals, and England has had the lowest proportion, although not the lowest absolute number.

Finally, it should be mentioned that in certain rural areas there is power to provide moneys from the Development Fund to support local industry and to prevent depopulation. Some of these areas are also places of high unemployment, such as North-West Wales, Buckie/Peterhead and the crofting counties, and in these places factory building will, in suitable cases, be undertaken by the Development Fund. Last year steps to create some 700 jobs were taken under these auspices.

I now turn to the part of the Amendment which urges the Government to take more vigorous control of new factory building by means of industrial development certificates. As I have said, every I.D.C. application for an extension or new premises of over 5,000 sq. ft. can proceed only after it has received a Board of Trade industrial development certificate. I have laid down that large projects, those of over 100,000 sq ft., should come to me personally before they are approved.

I should like to remove any doubts that there may be in any quarter of the House that we are trying to use this I.D.C. instrument as purposefully as we can and that we are prepared to refuse industrial development certificates in appropriate cases. A little later I will give some examples of refusals. B.N.S. has been mentioned but there are many others.

It is often urged that the Government should take stronger action to force firms to go to areas of severe unemployment. But there is a limit to this policy. Those who urge it most strongly seem to have forgotten that conditions have changed since the early post-war years. In those years there were widespread shortages at home and a sellers' market abroad. Firms could virtually sell anything they made at almost any price. With bulging order books, firms were glad to set up anywhere. But now conditions are quite different. If a firm calculates that it is economic to set up a factory in one place but uneconomic to set it up in another even though we offer it assistance to overcome the handicap, then to prevent it setting up where it wants to may mean that the factory will not be built at all. In that event, no one benefits and the whole community suffers. Despite this, however, since last July we have refused I.D.C.s covering over 3 million sq. ft.

The right hon. Member for Battersea, North (Mr. Jay) complained in our last debate that restraint on excessive industrial expansion in congested areas like London had been "feeble"—that was the adjective he used. He quoted the percentage of building that went on in the Development Areas in 1945-47 and 1945-51, and in this way effectively disguised the change in Government policy that took place in 1948 after the exceptional post-war period to which I have just referred. In fact, the percentage is roughly the same-19 per cent.—in 194851 and in 1952-58.

It was in 1948 that industrial development certificates were first introduced, and what the right hon. Gentleman calls "reasonable" development in the London area called for the issue of I.D.C.s to the amount of 11.6 million sq. ft. in 1949. The figure for 1958 was 9.9 million sq. ft. Therefore, even allowing. for war arrears, our record is, if anything, better than that of the party opposite. Again, I only mention this: I do not seek to score a party point. If we can get rid of this thrust and counter-thrust of who has done best, we will the better be able to find new methods of, and a new impetus towards, settling the problem. We are doing our best over the whole picture, and we are doing our best in the pockets of higher unemployment.

The refusal of I. D. C. s is not the whole story, however. I have found that the repeated affirmation of the Government's intention to use this control effectively has led more and more firms to approach the Board of Trade to discuss their plans for expansion before applying for the certificate. I have personally backed this up by talks with leading industrialists, and national industrial organisations such as the F.B.I., the National Union of Manufacturers and the Association of British Chambers of Commerce.

In these circumstances, it has been possible to persuade many of them to consider the areas of high unemployment, and a number of firms are presently examining the possibility of setting up capacity in these areas. I could quote many examples of firms that have gone to Northern Ireland. One at Swansea has been mentioned. They have gone to Llanelly and to Hull. After having had applications for I.D.C.s refused, they have been steered to the right areas.

I could quote quite a lot of chapter and verse to show that we have exercised the policy fairly rigidly, since I have been in the Department and before.

Mr. John McCann (Rochdale)

The last annual report of the Lancashire and Merseyside Development Corporation talks of development in the South and the Midlands. It points out that from 1945 to 1952 the percentage of building in those areas, as against the south-west of Scotland and Wales, has risen from 45 per cent. to 55 per cent. of the total. In other words, in spite of what is being done, the movement is still towards the South of England.

Mr. Percy Wells (Faversham)

Before the hon. Gentleman answers my hon. Friend, would he agree that although the South-East has not suffered, generally speaking, as badly as has the North, there are serious pockets, such as Sheppey, that we have to deal with?

Mr. Rodgers

I quite agree, and the hon. Gentleman knows that we are trying to get firms to Sheppey, and to the Isle of Thanet, too—another area quite near to London that requires firms to be steered to it. Even some of the new towns near London could do with them. It is true that some are very full, but others want more industry and, in particular diversified industry.

This only emphasises the point that we cannot look on this in narrow terms at all. We have to be believed by everybody in the House that we have a common policy; that we are trying to implement it; that we are trying, first of all, to create more employment throughout the country by active steps, and, in addition that through either the positive inducement powers that we have under the Distribution of Industries Acts or through the negative power of the refusal of I.D.C.s for the expansion of premises or the building of new premises, we are trying to steer those people into the areas which cause all of us, whatever our political persuasions, so much concern. The fact that, as the hon. Member for Abertillery reminded us, these areas are not, our political strongholds only shows the purity of our endeavours—

Mr. Frederick Wiley (Sunderland, North)

Before the hon. Gentleman leaves this point, which is very important, perhaps I may intervene. He has given some examples of where location has been effected by the persuasive influence of his Department. We could do with far more information about this. It is very important that the black spots in the Development Areas should know the sort of factors that have affected decisions like those on location. Cannot we have more information—perhaps in the Board of Trade Journal?

Mr. Rodgers

That is a very interesting point, and it is one to which I have given a good deal of thought, but the House may have realised that I was in some difficulty in saying what I did. If a firm wishes to preserve anonymity in these negotiations it is very difficult to give much detail. I only took some instances where I thought I could preserve that anonymity, whilst using them as examples of our steering policy.

It is only that that prevents greater frankness, and I think that that is why there are some misunderstandings in the House. We cannot often talk about what we are doing, but on my visits to all the areas I have met the local industrialists, the trade union leaders and the local authorities and have been able to tell them what were erroneously-held views of industrialists about their own areas. It is then up to them to do something about it. Equally, I have been able to learn from them certain things that have quietened my own mind in regard to allegations made by industrialists, and have been able, in some cases, to help overcome a slight resistance to change them.

It is awfully difficult to publicise. In fact, the more I publicise—perhaps I should stop talking now—the more diffi- cult I make the job for myself. I am always seeing industrialists, either singly or collectively. Every firm, of course, has different needs. Some want "boffins" and, therefore, need to be near the universities. Others want male labour, female labour; they want to be near markets or ports, or near some other type of factory. Therefore, even the most desperately needy area is not necessarily the area to which one would steer a particular firm. One must have regard to the economic well-being of the firm and its demands, and to the national economy as a whole.

Quite frankly, I should like to throw myself on the mercy of the House, and to apologise if, sometimes, we have not seemed to be so successful or forthcoming as the House would wish in what we are trying to do, or are doing. But I am sure that it is the nature of the job—as, from his own past experience, the right hon. Gentleman will understand—that this work should be shrouded, until we succeed, in an element of secrecy. If we try to secure publicity before achieving the desired results we might harm the Development Areas.

I assure the hon. Member for Abertillery that the Government are deeply sincere in their desire to use the Distribution of Industry Acts to direct industries to these areas; that we are watching the position, not only with regard to the Development Areas but also with regard to the rest of the country in case some areas should improve and, as the hon. Member suggested, should be de-scheduled, and other areas then put on the schedule.

The whole location-of-industry policy is one that has exercised the minds of my colleagues and myself a great deal in the last few months. We are doing all we can, as a Government, to try to alleviate this extremely grave problem because, I agree, we have somehow to find a method of restoring the balance between one section that may be over-prosperous and another that may be under-privileged. It is our constant endeavour to try to bring about a just balance between these two sections of the community.

6.0 p.m.

Mr. E. Fernyhough (Jarrow)

Whatever hon. Members who sit behind the Parliamentary Secretary may have thought, no one on this side can feel satisfied with what the Parliamentary Secretary has said. He is hoping, he is expecting, he is trusting, he is wishing—but at the end of it all we find that after twelve months' further serious consideration of this problem, after nine months of the additional powers which the Government have been able to use had they wanted to do so, they are able to say that they have found jobs for 1,700 people. That is less than 200 a month. At the rate of 2,400 a year it will be a long time before the unemployed in the Development Areas are found jobs.

Mr. Rodgers

I do not think the hon. Member is being fair. That is only one method, as I pointed out. Much more employment has been provided by the erection of factories and the extension of existing Government factories. This method is only one of the means available for providing employment, and the figure of 1,700 is not one which the hon. Member ought to quote against the total employment figure.

Mr. Fernyhough

Surely the position is that the Government had all those powers before? What the Parliamentary Secretary said was that under the new additional powers which the Government had taken unto themselves they had found 1,700 additional jobs. I am saying that because of the manner in which the Government used the powers they had, if the problem is to be solved at the rate of only 200 a month, there is no hope for Scotland, Wales. Tyneside and Mersey-side.

I was interested when the Parliamentary Secretary said that all the Government Departments were working together and were anxious to bring work to the Development Areas. I wonder how much they are working together. I wonder how much one Government Department knows what another Department is doing. In the north-east we are very concerned about the future of shipbuilding. We are also concerned about the uncertain prospects for ship repairing. Let us look at what the Manchester Guardian had to say on 20th April this year: British tanker launched in Genoa. A 35,000-ton tanker, the 'British Beacon', was launched in Genoa today for British Petroleum Tankers, Ltd.…The British Beacon ' is the third of a group of six identical tankers ordered by the company in Italy for a total cost of more than £11 million. This is patriotism. They can shout it from the housetops, but this is how patriotic British Petroleum Tankers Ltd. is as far as the shipbuilding industry of this country is concerned.

This morning I went to the Library to find out a little more about this company. I find that it is a subsidiary of the British Petroleum Co. The British Petroleum Co. is one in which the Government hold 50 per cent. of the shares and are entitled to nominate two ex officio directors. Presumably they can also nominate two directors to the subsidiary companies, and these directors, according to my researches, can negative any resolution passed by the board.

I wonder what discussions the Admiralty, which has some responsibility for shipbuilding and ship repairing, had with British Petroleum Tankers Ltd. I wonder what instructions the Government gave to the two appointed directors. I wonder why they were not concerned about this £11 million contract that went abroad. Why did the contract go abroad? Because we could not do it; because we have not the skill and facilities? Of course not. This is a measure of the patriotism of big business.

I hope that the Parliamentary Secretary will discuss this with the Admiralty and the Treasury and ask what the directors of the British Petroleum Co. are doing to permit a contract for fl 1 million to go abroad at a time when a recession is taking place in the shipbuilding and ship repairing industries. This contract could only have gone abroad if the Government were prepared to endorse it. It is because of factors like this that some of the old fears are returning to the so-called Development Areas and particularly Jarrow. We only need to contrast, as it were, today with yesterday as far as these areas are concerned. These are the areas in which our basic industries are situated. Let us look at them. Two years ago the Coal Board was spending hundreds of pounds a week. It was putting advertisements in every newspaper saying: Coal is a man's job. There is a future in coal. After the nine o'clock news in the morning the B.B.C. used to help in the recruitment of miners. Does anybody believe that coal is a man's job today? Does anybody believe that there is still a great future in it? Does anybody believe that the youngsters coming along are as certain today of a good future in the coal industry as they were two or three years ago? Of course they do not.

The Government disclaim responsibility, but what happened? In July, 1957, the right hon. Member for Monmouth (Mr. P. Thorneycroft), who was then the Chancellor of the Exchequer, told the House that we had to cut down, that we had to cut back. If one cuts back or cuts down one reduces employment, and that affects the coal industry as much as any other industry.

The same thing applies to the cotton industry. We had huge advertisements in every newspaper saying: Britain's bread depends on Lancashire's thread. The men and women in the cotton towns no longer believe that. It is said that the Government cannot do anything about these things when it is a question of coal because the consumer must have a free choice, and that if people prefer oil to coal, or if industry prefers oil to coal, we must not in any way interfere with their choice.

If we applied that yardstick to British farming, where would British farming be? It would be bankrupt and out. Everybody knows that the British farmer does not compete. Everybody knows that we do not expect the British farmer to produce at an economic price. We subsidise him to the tune of about £240 million a year. Every bit of bacon, every pint of milk and every pound of butter produced is cheaper abroad than we can buy it here. Why is this so?

Sir James Duncan (South Angus)

That is wrong. British farm produce is the cheapest in the world. I challenge the hon. Gentleman to go to any Continental country and look at the cost of living. The cost of meat and even bread is cheaper in Britain than anywhere else.

Mr. Fernyhough

I am a layman, but this is remarkable. The retail price of milk is 73d. a pint. It takes, I am told, eight pints of milk to produce 1 lb. of butter. Yet Danish butter today is selling retail in our shops at 3s. 2d. a pound. How in the name of fortune can our food be the cheapest in the world at that price? Why, if it is the cheapest, do we have tariffs to keep foreign food out?

Sir J. Duncan

The hon. Gentleman does not know very much about farming. There is no quota about it.

Mr. Fernyhough

I did not say under quota.

Sir J. Duncan

The hon. Gentleman talked about butter and I must assume that he was relating one to the other. The main sources of butter in this country are foreign and Commonwealth countries.

Mr. Fernyhough

Exactly. I am not disputing it. Will the hon. Gentleman say that we do not have any restrictions on bacon imports or on agricultural produce? Of course we do. All the time people ask for the tariffs to be put up to protect our horticulture, and so on.

Sir J. Duncan

Oh, no.

Mr. Fernyhough

Of course they do. The truth is that the policy of the right hon. Member for Monmouth was successful. When introducing it, he said, "It will make some folks' beds very hard upon which to lie. It means sacrifices. It means that we must tighten our belts and that we will suffer." The right hon. Gentleman does not appear to have suffered very much. There are a lot of other folks who have suffered as a consequence of his policy. That was the beginning of the fear that we had said goodbye to full employment as a policy. That was a deliberate attempt by the Government to slow things up and to reduce production. We know what the consequences are.

Anyone who has lived in the areas where there was mass unemployment in the pre-war years knows that of all the social gains in the post-war years, the one that is cherished most and has done most for human dignity, self-respect and confidence is the creation of full employment. To ordinary men and women who had to touch their caps, to hold their tongues between their teeth, to accept injustice and to be humiliated constantly, full employment has given a dignity and self-respect which they never had before. It is something to which they are entitled and something which they should be able to retain, but that is impossible so long as the Government take the line they do.

The Parliamentary Secretary said that we on this side were against industries developing and taking advantage of all the technological advances that might be coming along. Nothing of the kind. We are not Luddites. We are progressives. We are for expansion. What we say is that the Government have some responsibility, if they see that the trend is for an industry to contract, to redouble their efforts before the contraction has gone too far and to send the new industries to the areas where the contraction is occurring, rather than to pretend that it must always be the responsibility of the individual worker to tear himself up from the place where he has his roots and transplant himself in a foreign soil.

Even if the able-bodied workers are transferred from areas where industries are dying, we leave behind an old community to face all the debt which the local authorities incur, because the local authorities have built schools, hospitals, sewerage schemes, roads and so on. The debt does not become any the less because the young, vigorous population leaves. The debt is left for an ageing population—and, in some cases. an unemployed population—to carry. That is itself a tragedy.

The greatest tragedy of all is for the young workers of immature years when they leave school in these areas, and for whom there is no job. It would not be reasonable to expect them to transfer at the age of 15 or 16. A working-class boy or girl will have had a year longer at school than most of us. He has had a wider and better education. He leaves school at the age of 15 and thinks, "Now is the time when I can begin to make a contribution to the home and exercise a little independence." What happens, however, is that there is no job for him. If positions are not found for these young people, what is certain is that, in the long run, prisons will have to be built for them. People can talk as much as they like about child delinquency, but nothing will make a bigger contribution to child delinquency than to bring up boys or girls to the age of 15, with as broad and liberal an education as possible, and then to put them in the position in which they are second-class citizens, where they are not wanted, do not count and do not matter and where no position in society can be found for them. If anybody thinks that that is the way to treat young people, they must recognise that unquestionably some of the young people, out of bitterness and despair, will take the wrong road. It will be society and not themselves that is to blame, because we should so be able to organise our affairs that the tragedy of young people wanting work but being denied it should never exist in a civilised society.

I should like to think that when Ministers and hon. Members on the Government side speak of unemployment, they are speaking for those who help to provide employment. There are, however, different voices. Many of us were very disturbed about the remarks of Sir William Garrett, the President of the British Employers' Confederation, who said that the important thing was that the Government should not recreate the acute shortage of skilled labour which has so long bedevilled our efforts to increase efficiency. He went on: I think the facts show that these are not times for drastic measures. And it is most important that the Government should not bring about again that situation of overfull ' employment which has been the cause and accompaniment of the inflation to which we have been subjected for the last twelve years. He went on with something which, in my opinion, was a criminal observation. He said that three-quarters of the men wholly unemployed were labourers or were in unskilled work and added: There are only 70,000 adult skilled or semi-skilled men wholly unemployed today. What does he mean? Apparently the unskilled worker or the labourer does not matter; he does not have a belly to fill. a back to clothe or a wife and children dependent upon him. Because he is unskilled or a labourer he does not matter. But that man has as much right to earn his daily bread in a respectable manner and to be given the dignity of manhood by rendering a useful service to the community as anybody else. It is terrifying that men in powerful positions of this kind, such as Sir William, should talk in this manner about the problem of unemployment.

The Parliamentary Secretary said that the Government were doing all they could. In my constituency, since we have 6 or 7 per cent. unemployment—and the figure has been up to 8 per cent. —I wondered why the Tyne Tunnel could not be started. This is a project which has been under discussion for years. At last, the Minister of Transport and Civil Aviation has said that it has been agreed and the go-ahead signal can be given, although he cannot say when. I recently asked whether we could not make a start on the approach roads to find work for those who are unemployed, but "Oh no. not on your Nelly". We must wait until there have been a lot more conferences and a lot more discussions.

There is another way in which the Government might help to relieve Tyneside unemployment, particularly in the shipyards, and that is in regard to the new "Queens". We think we have as great a claim as anybody else to some of this work. It is a terrible reflection upon our society that Merseyside, Clydeside and Tyneside should all scramble for the same jobs, each trying to grasp whatever it can because they all face the menace of unemployment and all fear it.

We must face realistically the fact that unemployment is the substantive challenge of this age. If the idea gets abroad that the capitalist system can provide full employment only in war and cannot provide full employment in peace, let nobody believe that that will help to maintain the system. We are supposed to be engaged in a great ideological struggle. I believe it is a battle for men's souls rather than for their bodies.

Millions of people have not yet decided on which side to come down. They have not made up their minds whether the West or the East is right. If unemployment is again to be the lot of our people, and if it is seen that the West has boom, slump, unemployment and stagnation, let nobody make a mistake about the effects of the impact of that situation upon the uncommitted peoples. If they see stagnation looming up in the West but expanding production and increasing prosperity in the East, that could be the decisive factor in helping them to make up their minds.

When the Prime Minister is not in the House he realises that, too. Not long ago he gave an interview on the television to Ed Morrow, in which he said, "The free world is not going to defend itself by rockets and bombers, however good they are, but it will defend itself when outside people say that ours is the better way of living, because it gives the individual a fuller life and gives him the kind of thing he wants." If we are to have a world unemployment recession we can have all the rockets in the world, but we shall not defend ourselves against Communism or Left Wing propaganda. We shall defend ourselves if we can prove that this is the best way of living.

It cannot be the best way of living so long as men who are willing to work are denied work. We cannot be satisfied with the report which the Parliamentary Secretary has given us this afternoon. We do not feel that the Government are free from blame for the growing fears in the Development Areas. There is only one hope for the Development Areas and for the workers of this country, and that is for them to get those who are now sitting on Government benches out and to get us in.

6.23 p.m.

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

I will not follow the hon. Member for Jarrow (Mr. Ferny hough) down the broad road that he has travelled, although he finally arrived at the Development Areas before he sat down. I will stay in the Development Areas.

Those who had the pleasure of working with S. A. R. A., the Special Areas Reconstruction Association, in the year before the war, saw what could be done by steering industry into areas where distress was heavy. I was pleased to see the 1945 Act passed by the Coalition Government. I believe there is an impression that that Act has been a failure, but we should look for a moment to see what it has done and then look into the future to see what it might still do.

It is salutary to read again what was said in the debate in 1945. There is an undertone in Opposition speeches today that we are not forcing industry nearly enough to do what hon. Gentlemen think is necessary. That was never the intention of the Distribution of Industry Bill, as was very clearly stated by the right hon. Member for Bishop Auckland (Mr. Dalton) and the Minister of Production. now Lord Chandos, in the debate which took place on 21st March, 1945. The right hon. Member for Bishop Auckland said: It is not a plan to say what industry shall make and where it shall make it; it is a plan aimed at, first, the balance and diversification of industry, second, the preservation of amenities of our country and, third, at military security. These are the three touchstones by which we shall judge the location of industry."—[OFFICIAL REPORT, 21st March, 1945; Vol. 409, c. 949.] These were the purposes of the Bill as seen by its sponsors in 1945.

What has happened to them in the intervening time? I will not spend much time about the preservation of amenities. We can see that the policy of the location of industry has helped by preventing too great an agglomeration of industries in one place. The military effort, stressed very much during the passage of the Bill, has rather faded into the background. The main aspect of the location of industry has been its effect of diversification. It would be wrong not to say that diversification has proceeded a long way in Scotland since 1945. The face of Scottish industry has changed. There are many new units of production in Scotland. We have vast industries producing such things as accounting machinery, earth-moving equipment and heavy vehicles, and other new things which have come along since 1945. They have been steered gently into the areas where they could best serve the good of the nation. "Diversification" is a popular word. It is sometimes felt that diversification is the whole answer. We have succeeded to a very great extent. The Minister of Production gave his view about diversification in the debate to which I have referred when he said: I think it is unnecessary to deploy very long arguments about the advantages of diversifying industry. It is a palliative even if it is not a cure, for unemployment."—[OFFICIAL REPORT, 21st March, 1945; Vol. 409, c. 940.] I want to stress that point. We have found it not a cure but a palliative. There were wide discrepancies in the unemployment figures in Scotland for 1938 and for the year before the Act was passed in 1945. We should look at the figures since that date to see whether we are achieving anything by the location of industry. These figures are extremely interesting. I was surprised at the sponsors of the Amendment saying that "long-standing differences still exist". That was last year, and the figures are up.

Let us look at the five years beyond and to what happened to the attempt to equate unemployment throughout Scotland. I shall give the national figures and the Development Area figures. The national figure in Scotland in 1945 was 2.8 per cent. and, in the Development Areas, it was 3 per cent. There was not much difference between them then. In 1955 it was 2.4 per cent. in Scotland as a whole and 2.6 per cent. in the Development Areas. In 1956 the figures were 2.4 per cent. and 2.6 per cent. and in 1957, 2.6 per cent. and 2.7 per cent. The figures were getting closer. The disparities of the 1930s had gone and the national average was more nearly applicable to the whole of Scotland.

Mr. Willeyrose—

Mr. George

I realise what the hon. Member is going to say, that we must look at the matter in a broad way. I agree that those figures include areas where the position was not so good. Looking at the broad picture. it is true to say that in Scotland we have gone a long way. Unfortunately, in 1958 we started to diverge again, for then the national average was 3.7 per cent. and in the Development Areas it was 4.2 per cent. In December of that year—taking one month, which I never think a good thing to do—in Scotland as a whole the figure was 4.7 per cent. and, in the Development Areas, 5.3 per cent. The lesson to be learned from these figures is that the wide variations in 1954 have disappeared and that we may be reaching a point at which we shall have equal figures for the whole of Scotland.

The figures in 1958 showed that we were still vulnerable. Diversification of industry was a palliative, but not a cure. I want to look at what the future holds for us and to look at the question objectively. In Scotland we had great success in attracting new industries and we must pay tribute to the Scottish Council for the notable part it played in that task. I have quoted figures to show how the Development Areas average was coming nearer to the national average. In order to make my case, I must say that never at any time in those five years have they been less than double the national average for the rest of the United Kingdom. That is the point I have always in mind. What of the future? Are we likely to have more or less success in attracting new industries? The success we have had has stemmed from the success in attracting American investment. Are we to be less or more successful in that in the years ahead?

As laid down by the Scottish Council, we have provided 4,000 new jobs per annum in Scotland, where we have been bringing these figures together. If we had kept the Scottish figures equal to the national average we should have provided 12,000 new jobs in manufacturing industry. In the next ten years we must provide 120,000 new jobs. That is a huge task to tackle. How are we to get assistance in that task? Take, first, the expansion of existing industries and assume that we shall do as well in future as we have done in the past; we hope we shall do better. Then there is assistance from the United States of America and other foreign investment. The third item is the contribution from England in expanding industries. I wish to spend some time on those three points.

What is the picture for the future on foreign investment, particularly from the United States? In 1957 we had great success when by far the greatest percentage of industry coming from America went to Scotland. That was not to be wondered at because in those years the climate was favourable. United States businessmen recognised quite clearly that they were pricing themselves out of the export market. They wanted somewhere abroad where they could produce cheaply and obtain new markets for those they were losing. That was their problem. It was not the seduction of the Scottish Council, but their own selfish, individual interest which made them come to this country. I think they would have come without any of the attractions we gave by way of cheap rents, because they badly needed somewhere where they could produce cheaply. There was practically no one requesting them to set up in the United States.

Things have vastly changed today. We must take account of that and see what is to come out of it. We are not alone in requesting the United States to bring new industry. There are more than 1,000 organisations in America trying to induce firms to settle there in their own towns. It is going to be a hard battle. Dominating American industrial thinking about investment abroad today is the Common Market in Europe. They are hypnotised by the possibilities of that vast new market. They love its size, which is something like America itself. They love the volume of production they can sell in that market and they see a chance of getting manufacturing costs at the American level. In the Common Market they see these benefits and also a tariff wall arising behind which they can shelter with all these benefits.

There is a magnet turning them away from Scotland, England and Wales into Western Europe. That is something we cannot disregard. Not only do we see America having a market there to her liking and a tariff wall erected to help her in that market, but we see the amazing picture of France, and I know she will be followed by others as others have preceded her, offering fantastic inducements. In the Daily Herald there is an article which says: France sets a bait for British firms. Tax aid and loans if they go to Calais.

Mr. Willey

As he has referred to that article, is the hon. Member aware that it is alleged that two Conservative hon. Members are in fact directors of the publicity firm which is inducing capitalists to place their money in France?

Mr. George

I should be quite certain that if it were not done by those two gentlemen it would be done by others.

Mr. Thomas Fraser (Hamilton)

That is no excuse.

Mr. George

It is no excuse, but the job will be done in any case. The fact is that United States industries which helped us so much in the post-war years are now having these magnificent attractions of the Common Market and a tariff fence, plus these inducements to set up in Europe. We must ask ourselves what attractions we can produce in Scotland to offset the attractions which are now evident in Europe. If we cannot produce those inducements to bring industry from the United States, we can look forward to years ahead when they will not be coming to Scotland but going to Europe.

We have had some guidance on the position of our propaganda in the United States from Sir Robert Maclean, as reported in the Glasgow Herald of 13th March, this year, when he spoke of the mission from the Scottish Council to North America. He is reported as having said: …competition for new investment is keen. Canvassing in the United States for new factories is being done, it is estimated, by over 1.000 agencies …Some of the programmes to attract new investment are backed by substantial funds and are carried through by large permanent staffs …while the strong and continuing advantages of Britain as a production base are not being adequately presented. I am trying to present a picture of severe competition with heavy advantages against us and our case being inadequately put in the United States, according to Sir Robert Maclean. What are we to do about it? The Scottish Council has done a magnificent job. All through its history it has desired to be free from Government support, but can that go on any longer? As suggested in that speech by Sir Robert Maclean, it is facing failure in the United States. In spite of its efforts, we are told that our case is not being adequately presented.

What are we to do about it? There are a thousand agencies seeking United States industries and we ourselves are not doing the job well enough. I suggest that the Scottish Council should be made a stronger body and should receive Government contributions to its funds. In the United States it has a voluntary committee, with eminent Scotsmen in charge, with the entree to the big industries' boardrooms. These people can do a good job but, as I have said, we have been told that the job is not being done well enough, and we feel that it should be done better. The Council should be asked to accept money from the Government in order to boost its efforts in the United States. If that is not acceptable, we nevertheless cannot rest while our case is not adequately presented in the present atmosphere of competition, and the Government must set up a body of their own in the United States to sell Britain to United States industrialists.

Still speaking about selling Britain and especially Scotland, can anything be done elsewhere? Something is being done in Scandinavia by local authorities, but what is done to sell the opportunities of industry in Britain to other industrial firms abroad which may want to set up in Europe? What agencies have we in other countries for this purpose? Has each ambassador on his staff an industrial attaché who can present to the country in which he is acting the benefits for industries coming to Britain? Is there any other way which can be devised to sell Britain abroad far better than is being done today?

Those are the mechanics of the situation. What inducement should we offer to try to turn the balance in our favour? Unless the advantages of Scotland are overwhelming, inducements will always be required, but in the present atmosphere in America, with the flood of requests from other countries for American industry, there will be great difficulty. We know that Northern Ireland is among the countries offering inducements to American industry. In that atmosphere, what inducements can we in Scotland provide to turn the tide?

I believe that the tide is running so heavily against us that there is very little that we can offer. Frankly, if the Common Market is established and proceeds according to plan, and if we are in no way connected with it, I believe that it will have a strong impact upon our industries. I believe that the only thing we can do is to ensure. by whatever logical and sound means are at our disposal, that some accommodation is reached between the Common Market and the concept of a Free Trade Area. If that can be done, one of the major fears in my mind will be removed.

We can already see the trend towards the Common Market at work. In the last three months six new American industries have been set up in Holland, whereas in the last six months not one has been set up in Scotland. It is already beginning to work, and I have fears for the future in Scotland. I believe, frankly, that unless some accommodation is reached between the Common Market and the Free Trade Area concept, the outlook for us is bleak.

Mr. Lawson

The hon. Member has told us a lot about what the Americans should do for Scotland. Will he tell us what Scottish business men should do for Scotland?

Mr. George

If the hon. Member will wait I will tell him exactly what they should do.

We shall still attract some industry, because Scotland has natural advantages but, apart from those firms which we attract naturally, I think that the Government should watch very carefully the inducements which are being offered by countries which have no tariff protection. We should match the attractions offered elsewhere.

What of the position if United States industries do not come to Scotland? That is the question which the hon. Member for Motherwell (Mr. Lawson) asked me. We are told by the Scottish Council that it is convinced that there is adequate capital in Scotland, and the reason it has pressed for American industry to come to Scotland is not a shortage of capital but a lack of know-how and technical skill in Scotland. The Council obtained technical skill from America, and capital with it, and helped Scotland in the new age of technical advance.

The position which I postulate is this: if American industry no longer comes to us and if Scottish capital is available but not the skill, the problem is changed to one of how we are to marry the skill which exists in America with the capital which exists in Scotland. That is the problem which we have to face. We have the licensing arrangements, which offer the obvious way to marry the skill without bringing capital from America, but if United States industries set up in Europe, it is unlikely that those industries will give us the know-how.

There will, however, still he many industries left in the United States from which we can obtain the know-how to start new industries and to introduce new techniques into this country. I think that the Scottish industrialists should seek out and expand the present methods of obtaining licences from the United States for new processes, along with the know-how, and should apply Scottish capital to this know-how and turn it into new industries in the absence of United States industry. I put it to the Minister that if we marry American skill with Scottish capital in this way, the industry thus created should be treated by the Government as if it were a new American industry setting up in Scotland and should receive the benefits which that American industry would have received.

We are told that in certain modern processes American skill is much higher than ours. We are told that Scottish capital exists. If we are to marry the two we have to find ways and means of training our men in America. It can be done. When I left the coal mining industry in 1946 I knew nothing about glass making, but I went to America and spent six months being taken around glass-making factories in the United States. The Americans very willingly showed me all the know-how. I admit that I had no intention of competing directly with them, but I would emphasise that the doors were open and the skills were laid on the table for me to pick them up. I believe that we can extend that a great deal. Much good will exists in America for Scottish industry.

I would emphasise, too, that Scottish industry should be more ready to take graduates on the staff. We are not doing enough in this direction. The Scotsman on 30th June, 1958, reported the Glasgow University Appointments Committee as having said that there was still too great a tendency among Scottish firms to wait until the need became desperate before they sought to recruit university graduates. The graduate is the type of trained man who can accept all the information which the Americans are prepared to give. There is plenty to give.

The urgency of adopting this policy becomes greater and greater as the threat increases of American industry ceasing to move to Scotland. In order to overcome the lack of American industry flowing into Scotland —and I am afraid that it may cease to flow into Scotland—these are steps which we must take.

These great and important jobs lie at the door of free enterprise. There is little that the Government can do about them. if free enterprise is to be the dominant partner in our economy, it must seek out and accept its responsibilities—and I believe that in Scotland this is one of the responsibilities which it must accept. if industry does not move into Scotland from abroad, we must try to help our own industries.

There is another way which we have a right to explore. We have already taken one large step forward in taking a strip mill to Scotland. I agree that this prevented Wales from having a bigger strip mill, but we know that the result will be to create new industries in Scotland in the years which lie ahead. Nevertheless, I am not certain that this and the other things which I have mentioned will achieve my object, and what should be the object of the Unionist Party, of bringing the unemployment figures of Scotland down to the national average within ten years.

Mr. T. Fraser

Ten years?

Mr. George

I believe that it is a very big job and will take ten years.

I suggest that we must take two other steps. First, we must not wait until application is made for development certificates. I should like to see the present relationship between the Board of Trade and the Secretary of State for Scotland reviewed and some changes made so that the Secretary of State could offer inducements to firms to move into Scotland from England.

If I were in his place I should go to the vehicle industry in England, which is bound to expand, and I should offer it the same conditions in Scotland as we have given to others to set up its next major development. I should go to the electrical industry and offer it the same conditions to set up in Scotland as we have given to the strip mill. I believe that an additional £100 million is not too great a price to pay for equating Scotland's figures to the national average. These three bold steps could in a few years so change the face of Scottish industry that we could look to the future with confidence.

6.50 p.m.

Miss Margaret Herbison (Lanarkshire, North)

I am very pleased to follow the hon. Member for Glasgow, Pollok (Mr. George). I completely agree with much of what he said, I was interested in what he said about our need to do everything possible to attract American industry, and again I am in full agreement with that.

I was interested in the hon. Gentleman's final suggestion about how we ought to go into England and attract English industry to come to Scotland. I should have liked the hon. Gentleman to have devoted a longer part of his speech to what Scottish industrialists themselves might do for Scotland. The position which we are in at present can be, to a very great extent, laid at the door of the lack of initiative of Scottish industrialists themselves. It is due to the capital which is in Scotland—the hon. Member for Glasgow, Pollock agreed that it was in Scotland—not being used for development in Scotland. It is very often used for development outside.

The hon. Member for Glasgow, Pollock is a very able Member. I hope that he will use all the influence he has, not so much with the Americans, not so much with the English, but with our industrialists in Scotland.

I want to touch on one other very important point which the hon. Gentleman made. I am fortunate in having one of those American firms in my constituency. It is doing an excellent job. I hope to see many more coming. Like the hon. Gentleman, I feel that there is very little opportunity in the future so long as the Common Market offers the opportunities that it does to American industrialists, who are very hard-headed businessmen. Every effort should be made by the Government to establish as soon as possible what came to be known as the Free Trade Area. If that is not done, Scotland will suffer greatly.

This is a debate on Development Areas. My constituency is in a Development Area and has been in a Development Area ever since these areas were scheduled. I want to speak first about one part of my constituency, and that is the part which has been more badly hit by pit closures than almost any other part of the United Kingdom, whether it be Scotland, England or Wales. The first closure after nationalisation took place in 1949. We know that many pits in Lanarkshire were closed long before nationalisation, but the first pit closure in my constituency after nationalisation was in 1949.

From 1949 to 1958, in one village alone in my constituency five deep mine collieries and two others were closed. The number of men employed in those seven undertakings at the time of closure was 1,174. That is a very large number. If one had been able to obtain the figures of previous years, they might have shown that the figure of 1,174 was a very conservative estimate.

When the mass closures were announced by the National Coal Board, three further collieries in that same district became doomed. One of those three was in the village where the seven other undertakings had already closed. The second was on one side of it, and the third was on the other side of it. Taking the area as a whole, three have been doomed. I was told by the National Coal Board that at the time of the decision to close these collieries 987 men were employed. Altogether, in less than ten years in this one small area of Scotland we have lost 2,161 jobs. That is a very serious position for that area.

The village in that area which has been worst affected is Shotts, but the surrounding villages of Cleland, Harthill, Salsburgh and Newmains also have been seriously affected. The Parliamentary Secretary said that we had to have some system of priorities and that whatever help could be given by the Board of Trade must be given to the worst areas. The hon. Gentleman said to my hon. Friend the Member for Greenock (Dr. Dickson Mabon) that it was not a case of areas where unemployment was threatened but where unemployment existed. My hon. Friend the Member for Greenock asked for intelligent anticipation. He urged, in other words, that the Government should not wait until a place became derelict before they decided that some action should be taken.

The Minister might say that most of the men made redundant by these closures have been placed elsewhere. That is true. The Minister might say also that unemployment is not as high in that part of Scotland as it is elsewhere. Again, I agree that that is true. For the area covered by the Shotts Employment Exchange the latest figure I have been able to find out is 4.6 per cent. That is very much higher than the national average, although it is not as high as the figure for the whole of North Lanarkshire, the latest figure for which is 8.4 per cent.

I am not basing my case today for new industry for this area so much on the figures of unemployment, although they are far too high in that area. There is scarcely a job for women in that area. The Minister said that he could not be an industrial Canute and keep back progress and that there had to be certain developments in industry. I am not asking the Minister or the Government to take any steps that will keep back progress. All I am asking them to do is to anticipate progress or decline of an industry in any area and to take steps to meet any kind of development that might make an area a derelict area. I am attempting to make the Minister realise that, if he does not apply to this district all his powers for the distribution of industry, its future is a very bleak one indeed.

As I said when I started, this district has always been a Development Area but has so far reaped very little benefit from that fact. For years I have tried to make the Government realise the importance of planning ahead, as have my hon. Friends the Members for Greenock and Abertillery (The Rev. Ll. Williams), in his wonderful speech moving the Amendment. I have tried to bring out clearly that the Government must plan ahead if such areas are not to be left derelict. If we do not do something quickly there, and in areas in, for example, Durham, that will be hit in exactly the same way as mine has been by the closure of pits, they will, indeed, be left almost derelict.

In previous debates, I have produced the kind of statistics that my hon. Friend the Member for Abertillery has given today to show how, right from 1951 until 1958, this Government were not using all the powers they had to ensure that more industries and greater diversification of industry came to these areas. Since these figures have been given so adequately already, I do not intend to repeat them.

Are not the Government interested in the social assets of this area and similar areas where the mass closures will have a very great effect? Are they not interested in the housing that local authorities have provided, in the privately-owned houses, in the churches, the schools, the halls and the shopping facilities? Are they quite content to allow between 2,000 and 3,000 jobs to disappear and make little or no attempt to ensure that some other kind of industry comes in?

I should like the Minister to tell me if the Government have any proposals at this time to give us some other kind of industry that will absorb some, at least, of the 2,161 jobs that have already been lost. Young miners and their families are moving out every week. I do not blame them. If I were a young miner and wanted to continue in the mining industry, then, whether or not my pit was closing, I would move to a developing area where my family could put down roots when young and where they would be able to make their lives in the future. But what about those who will not be moving? Are the Government content to see these places left as sad depressed districts occupied only by old people, or have they any intention of planning to ensure that there is a future there?

I should like the Minister of Housing and Local Government to clear up a specific point on overspill. As I have said, many of the miners are moving out of this district, so it seems to me to be a most suitable place for an overspill arrangement with Glasgow. I know that the Lanarkshire County Council has great doubts about these overspill agreements and has not been willing to make one with Glasgow. If the Minister can tell us what industrial advantages would be brought in by an overspill agreement, it would be a very great help to the area and might help me in trying to influence the local authority to come to an agreement.

I know that many industries will have to move out of Glasgow. I want to know whether the areas that take Glasgow overspill will have advantages in receiving them. We would give them a great welcome in Shotts and the neighbourhood. The Joint Under-Secretary of State, the hon. Member for Craigton (Mr. J. N. Browne), knows a little about this area, I am sure. It has a fine community spirit. For its size, it has outstanding cultural and sports facilities. People are proud of their village, and many of them are willing at all times to give of their time and energy to all kinds of community activities. It is because it is such a place that I have tried over these years to ensure that it has a future. If we can be assured that there will be industrial advantages, a very great welcome would be given to the overspill population, who would find that they were coming to an area which, besides offering advantages in industry, would offer them very great advantages in many other ways.

We have been told about the strip mill that is coming to Scotland. Fortunately, at the end of my constituency near Glasgow. the cold rolling process of the strip mill will be sighted. A little over eighteen months ago. 1,100 men were working at Smith & McLean's steelworks at Gartcosh. Today, the figure is just over 500. I understand that, in the first instance, the number employed in this final process of cold rolling for the strip mill will be between 500 and 600. In other words, the area will have lost about 600 jobs.

The fact that the end-product of the steel mill is to be in that area should bring great hope, but here, again, I want the Government to use intelligent anticipation—not merely to look at the figures of unemployed, high as they are, but to realise that if we are to benefit from having this end product of the strip mill in that part of my constituency the Government can and must help greatly.

I ask the Government now to review the area around Gartcosh. Not very far from Gartcosh, the Lanarkshire County Council is building what could at least be described as a new village, almost a new town, to house the people over a very wide area. That seems to me to be a most suitable place for the intelligent planning of future industry by the Government. I ask them to use the services of their regional controller and his staff to survey the area in order to find out the possibility of industrial sites, so that when this steel strip project is completed —and I will really enjoy the day when I see the first product coming from the cold rolling mill—we will know that planning has taken place, and we will have industries in these areas. This is a heaven-sent opportunity to attract new industries to this area. The Government must not lose this opportunity.

7.10 p.m.

Lady Tweedsmuir (Aberdeen, South)

The hon. Lady the Member for Lanarkshire, North (Miss Herbison) did less than justice to the efforts that the Government have been making for a very long time to try to induce industry to go to just those areas like her own that are suffering from a revolutionary change in the sources of power, the advance of technology and other sciences. In almost the same breath she mentioned the fact that Scotland is to have the strip mill, part of which is to be in her own constituency.

I wish to deal with Scotland's problems because I feel that it is very necessary for all concerned in the future of Scotland to do their utmost to bring down unemployment there to a level comparable with that in the United Kingdom. Over a long period of years, unemployment in Scotland has, on average, been about twice as bad as it has been south of the Border. A great deal has been done lately through the Budget and through bringing forward public works to the extent of £10 million in response to local and immediate pressing needs. There are also the longer-term needs such as the expansion of atomic energy for industrial purposes, and, of course, the steel strip mill.

It would be wise for us to take together all the Distribution of Industry Acts and the other Acts which are available to give financial or other assistance and consider how much we want to have temporary measures and what really is the long-term pattern of industry and employment which we wish to see shaped in Scotland as a whole.

From all I have heard, I believe that there is no lack of capital in Scotland at this lime, and I do not, therefore, believe that the inducements of D. A. T. A. C. will really be so helpful as they might be thought. For instance, in my own area of Aberdeen there have been only six firm, eligible inquiries. Two applications have been granted, one has been rejected, and three are under consideration.

Many of the problems were summed up in a letter I received from a firm which I know well, having worked in it during the war. It is an engineering firm which, in the normal way, makes horizontal diesel engines. It has recently put in capital equipment to the extent of £50,000, and it has a very good force of work people, many of whom have been there for several years.

In its letter, the firm said: Until 1954, we exported close on a quarter of a million pounds of horizontal diesel engines annually to the Middle and Far Eastern countries and South America. Since then, through balance of payments difficulties, tariff barriers such as those 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 uneconomic level. For the past few years, we have filled this gap in our works by making, under sub-contract, coal making machinery and cargo oil pumps for tankers. What this company really needs is to be put in touch with firms which would give it some kind of sub-contracting work.

This firm has done a great deal. I quote this situation as an example of the kind of problem which must confront a good many long-established companies in Scotland.

The company is in the closest contact with the Scottish Council (Development and Industry) and with the United States consul. It has had people travelling abroad, searching in every direction for two things. It wants a chance to make new products, but, as everyone knows, it takes about two years for a firm to tool up and get into production and to manufacture under licence agreements with overseas firms. In the meantime, it wants to be put in the way of some kind of sub-contracting work. It is not the type of firm with requirements which are difficult to meet, because it is able to undertake the manufacture of any mechanical engineering product from a few pounds to 7½ tons.

This is where I turn my attention to the Board of Trade. I really believe that the Scottish Council (Development and Industry) has, to a very large extent, taken over the functions of the Board of Trade in Scotland. We all know that the Scottish Office does not have the powers of the Board of Trade. As I think most hon. Members representing Scottish constituencies will agree, the Scottish Council has done very fine work. But I cannot help noticing that the Development Council in Northern Ireland, under Lord Chandos, has a direct grant of £40,000. I do not in the least mind asking that the Scottish Council should be given some form of direct grant in this way in order to open branch offices all over the place.

As my hon. Friend the Member for Glasgow, Pollok (Mr. George) said, we are in a time of the fiercest competition. I believe he said that in America there are over 1,000 agencies representing other countries. According to figures which I have, there are over 6,000 agencies representing the Commonwealth, South America and Europe as a whole. We have commercial sections attached to our embassies, but this is really not enough. We must ensure that a body such as the Scottish Council can continue work which undoubtedly has been of the greatest benefit so far.

In considering what we hope will he the shape and future of Scottish industry, we have in mind the future work of the strip mill which will give us the basic material support we very badly want. As hon. Members on both sides of the House, in debate after debate since the end of the war have said, Scotland needs to reduce her dependence on heavy industry. Manufacturing industry in Scotland provides about one-eighth fewer jobs than is the case in the rest of the United Kingdom. The net increase in this type of job every year amounts to about 4,000 jobs altogether, compared—taking population and everything else into account—with about 12,000 south of the border.

If it is difficult for individual firms to find the markets which they need, would it not be possible for the Government to encourage individual firms to come together and form a consortium for the purpose of obtaining orders and producing new consumer products? After all, it is a very long-established practice in capital goods manufacturing for companies to come together and form a consortium, and I do not see why it could not be done by smaller firms if they were put in touch with people ready to buy the right type of product for them to manufacture. They would then, in my submission, be able to join together and evolve the methods of mass production techniques which are so important and which are prevalent in North America.

In my view the various Distribution of Industry Acts should be reviewed. Basically, they were thought out about fifteen years ago. We on this side of the House do not accept that there should be direction either of labour or on industry. Therefore, if we are to rely on inducements or financial assistance in Scotland, we must consider Scotland as a whole. The trouble about all these Acts is that they benefit the United Kingdom as a whole, but that they do not offset the geographical disadvantages of Scotland. Even if she does benefit, Scotland's problems are always twice as difficult as the problems south of the Border. I say quite frankly, therefore, that, if there is to be a determined effort to take advantage of the very fine labour force and fine basic facilities there are in Scotland, the inducements must be specially favourable to Scotland as a whole.

There are very few parts of Scotland which are left out if one looks at all the areas which are either scheduled now or which come within the original Development Areas. Practically the whole of Scotland already comes in either the one category or the other.

It seems to me that we are slipping into a position where the whole of the country north of the Border will be eligible for special assistance. Therefore, the special inducements, however they may be devised, should be preferential for the country north of the Border because it has to offset its geographical disadvantages. The Government will probably use the well-worn phrase, "You will spread the jam too thin". My answer to that, at a time when we are striving for industrial expansion, is, go and buy another pot of jam. [An HON. MEMBER: "Marmalade."] Not marmalade, because that is too sticky. I should say that a proper simile, if one is wanted, is oil because it flows evenly and quickly into the crevices where it is most needed.

The trouble about the Distribution of Industry Acts is that because the country is divided into areas which are sometimes 40 miles apart, one area is eligible for assistance and the other area placed 40 miles away is not. Therefore, there are delays about decisions, about whether the unemployment percentage is high enough and whether the unemployment has gone on long enough. That is the wrong approach altogether.

I agree with the hon. Lady the Member for Lanarkshire, North who said that unless we get a solution to the Free Trade Area problem we shall not attract the foreign industries that we need to Scotland or to the United Kingdom as a whole. I hope that the Minister will tell us, if he can, the latest developments in the discussions between the seven countries concerned about the new arrangement of the Free Trade Area under O. E. E. C.

Scotland's problem industrially is very much akin to that of the Commonwealth. Much of Scotland is dependent on one major industry or basic commodity. We must expect in the coming months that there will be a rise in the price of basic raw materials coming to us from the Commonwealth. I think that we should welcome that because, although it makes it more difficult for us in some respects, it will help this country, since it will make it more possible for Commonwealth countries to buy our exports.

What we want to achieve for the benefit of us all is a more stable, even if higher, price in basic commodities. At the same lime, if we in this country try to create a greater variety of industry we must always remember that variety in itself means many ups and downs. If we have variety we cannot expect a uniform level of stability in all types of industry all over the country. There are bound to be moments when some industries are flourishing, some undergoing change and some giving way to new techniques.

This is where I think that all of us—industrialists, those who work in industry and the Government—must adopt an entirely different attitude to the moving of industry and of people from one end of the country to the other. Take, for example, Canada. There people go right across the Continent for their jobs. I remember going to a mine in British Columbia which was 4,000 feet up in the mountains and where the men worked under very difficult conditions. Incidentally, they had not seen a woman for a year, and when the foreman saw me coming up the path he rushed away to shave. He was so out of practice that it had dire results. I said to one of the mine workers, "Where is your home?" He said, "My home is where I hang my hat." I think that is a perfect example of an enterprising attitude to work. Whole families are prepared to move and to change jobs, and in consequence, because they move and because other families have the same attitude to life and to work, there is mobility throughout the nation. That is healthy.

I think that the attitude of young people in industry today is not nearly so dependent on the idea that they must stay in one area. It is perhaps wise to remember that those in the south of England who are now aged 30 have lived in a period of boom, or near boom, since the age of 10. Their attitude towards industry is entirely different from that of those brought up during the 'thirties and the world-wide recession. That being so, I am certain that in Scotland young people will not be content with the cautious approach that was suited to earlier times. That is why I hope that all of us will realise that in a country which does not have direction of labour or of industry we must have a partnership between the Government, industrialists and those who work in industry. I hope that the Government will make a determined attempt to see what they can do for Scotland as a whole.

7.26 p.m.

Mr. Douglas Jay (Battersea, North)

If I may presume to follow two hon. Ladies, my hon. Friend the Member for Lanarkshire, North (Miss Herbison) and the hon. Member for Aberdeen, South (Lady Tweedsmuir), who both represent Scottish constituencies, I should like to ask the Government a few questions which arise out of the speech of the Parliamentary Secretary to the Board of Trade.

When we debated these issues in March, the Parliamentary Secretary said that the proposals from us on this side were either misguided or worthless, and the Minister of Labour and National Service said that the Government were pursuing them already. Today the Parliamentary Secretary has veered round and seems to me to have joined the Minister of Labour. He told us today that he is doing all that we want him to do. The truth is that the Government very largely abandoned the Development Area policy in 1956, but, after prolonged pressure from the areas themselves and from hon. Members on this side, they now claim to have returned to it. I am still not altogether convinced, after the Parliamentary Secretary's speech, that this conversion is a matter of deeds as well as of words. Having listened to the brilliant and persuasive speech of my hon. Friend the Member for Abertillery (The Rev. LI. Williams), all I want to do is to have a look at the facts and to ask the Government a number of questions which have not yet been answered.

The Parliamentry Secretary today mentioned the further light thrown on the figures of employment as opposed to unemployment which have been published today. The outstanding fact, which is the background to the whole of this discussion, is that the number of persons in civil employment in the whole of the country today is 340,000 fewer than it was last August. When the Minister of Labour told us in March that unemployment had fallen by about 50,000 between February and March, he omitted to mention that employment had also fallen by 60,000 over the same period. I cannot think that he was being particularly candid on that occasion. Anyway, the fact is that the main reason why unemployment has fallen since February is not because people have found jobs but because they have given up looking for them. That is the plain conclusion to be drawn from the figures, and I do not think that anybody would deny it.

On the test of the facts are the Government carrying out a Development Area and distribution of industry policy, which they claim, and are they doing it vigorously, as we say in the Amendment that they should? The best single test is the percentage of new factory space going to Development Areas, on the one hand, and to the congested areas, like London, on the other. In the March debate, I gave these simple figures covering a period of years and not one or two selected years. I do not think that the Parliamentary Secretary denies them. In the first three years after the war, Development Areas with 15 per cent. of the population got about 45 per cent. of the factory space. During the six years from 1945 to 1951—and I emphasise this figure—the Development Areas got 30 per cent. of the factory space. But in 1958 that figure had fallen to 18 per cent..

Mr. J. Rodgers

Would the right hon. Gentleman like to give the figure for the percentage between 1948 and 1951?

Mr. Jay

Because, if I may say so, the Parliamentary Secretary has a certain tendency to bring this controversy down to a party level, I will deal with the point. The Parliamentary Secretary—I do not want to spend a lot of time on this—must be ignorant of the post-war building situation if he does not know that so many houses and factories were started in the years 1945 to 1948 that it was necessary to slow down new starts in order to complete the ones already started within a reasonable period. If the hon. Gentleman will look up any of the facts, he will see, for that reason, of course, that one or two years, such as 1948 and 1949, give a meaningless conclusion. But let us leave that aside. Let us look at 1959 and see whether there really has been a change since 1958 in the way this policy has been carried out.

The Minister of Labour and National Service told us in March—the Parliamentary Secretary, more or less, said it again today—that the policy of stricter control, more stringent control, had been introduced last October, and we have been constantly told that at the same time there have been fewer licensings in the Development Areas since then. I should be delighted were this change of heart really genuine. I have been looking at the statistical digest in order to compare what has happened in the first three months of 1959 with the corresponding months of 1958. I gave notice of this to the Parliamentary Secretary. Incidentally, I regret that at the end of last year the Government altered the whole basis of the figures so that it is no longer possible to get the figures of building for specific Development Areas.

My hon. Friend the Member for Hamilton raised this point at Question Time and I gather that the Government here, too, have repented, and that we are to have the original figures restored. But because of this difficulty, which is not my fault, I have had to take the figures for approvals in square feet for the first three months of 1958 and the first three months of 1959, and compare, on the one hand, the London and South-Eastern Region and, on the other, the whole of Wales, Scotland and the Northern Region. Of course, the latter is not the same as the Development Area, but it was the best I could do and, naturally, I am using the same area for the two years.

We are told that there has been a great change in policy, and therefore we ought to find a great shift in the percentage of national factory building going to London, on the one hand, and to the Development Areas on the other. But according to my arithmetic—which has been much improved by my hon. Friend the Member for Hamilton (Mr. T. Fraser) —the figures are as follows. In the first three months of 1958 London got 15.8 per cent. of the national total, and in the first three months of 1959—after this great change of policy—it got 15.8 per cent. again. The three Development Area regions got 22.6 per cent. of the national total in the first three months of 1958, and in 1959 they got 22.7 per cent. In spite of the help which I received from my hon. Friend the Member for Hamilton, I do not press the matter of the difference of 0.1 per cent. But, on the figures, it looks so far as though there has been no change at all. If this be so, it is a little disturbing, and I hope that we shall be told that the figures are not really quite so bad as that.

The second test of a Development Area policy, I think, is how many factories are actually being built in the Development Areas and, of course, in other areas where the unemployment figures are high. The Parliamentary Secretary, obviously having in mind Government-financed factory building and Government spending, said there must be some limit, and so forth. But I wish the hon. Gentleman would think of this matter as it really is, as investment and not spending in the ordinary sense of the term. This is public investment in revenue-earning productive assets in these areas. That is the way in which the hon. Gentleman should regard it.

We all know that the building of Government-financed factories in the areas fell heavily in 1957 and 1958. Lord Bilsland has told the story, and so I do not have to. Incidentally, the total approvals for Development Areas fell from about 14 million sq. ft. in 1957 to 8 million sq. ft. in 1958 and clearly, therefore, Government-financed building fell very heavily at that time. Pressure has continually been brought to bear on the Government and now they claim to have resumed building, particularly Government-financed factories. But after the experience of the last few years, we should like to have proof of this, actual concrete proof.

Replying last week to a Question from me, the President of the Board of Trade gave some figures, and we have heard similar figures today from the Parliamentary Secretary. We were told that in the present year 52 Government schemes have been approved compared with seven last year which, incidentally, is a melancholy comment on what was happening last year in the Development Areas. We were also told of 81 private schemes this year compared with 86 last year. I agree that the President added—this is more important—that the total number to be employed involved in both sets of schemes together had risen from 6,300 to 14,000. That is somewhat more reassuring, compared with the lamentable record of 1958. But, even so, the figures for private schemes are not nearly so reassuring and there appears to have been little revival in that direction.

I wish to ask the Minister, although the areas are not quite the same, how exactly these figures are to be reconciled with the figures I quoted from the Digest. If the percentage of approvals in Development Areas is only the same this year as last, and if the volume of employment, according to the President of the Board of Trade, is something like double, is it the fact that there has been merely a revival of factory building in Development Areas this year which is proportionate to that going on in the rest of the country? Is that the explanation of these two different sets of figures?

I shall be glad to have figures for new factory building this year in the very severely hit part of the Development Areas, like, for instance, South-West Wales. Cannot the Parliamentary Secretary, even now, tell us that approval has been given to the Huntley and Palmer scheme at Huyton which was held up by the Government for many months last winter, and about which in neither debate have we been given a firm answer?

Mr. J. Rodgers

It has not been held up. There was negotiation about what rent should be paid and whether the firm should itself build or whether we should build it an extension. This was settled some weeks ago.

Mr. Jay

I am glad to hear that. It has taken some six months of pressure from a great number of people.

Before we are really convinced that the Government have been converted, even in the matter of Government-financed building schemes, I should like to ask the Minister three questions. First, have the Government "come clean" on this administrative rescheduling, which I think has been one of the real mistakes of the last two years? There have been certain parts of the Development Areas where the Government have ceased building Government-financed factories altogether. Several times the President of the Board of Trade—the Parliamentary Secretary did it again today—has quoted certain parts of the Development Areas where the Government are willing to build Government-financed factories. When we have asked whether this means that they are not willing to build them in other areas, the right hon. Gentleman has never given anything like a complete answer. I should like to be assured, and the hon. Gentleman should give us an assurance if he wishes to convince us of his sincerity, that this ban has been completely removed and that the Government are willing to build in any part of the Development Areas. I ask the Parliamentary Secretary to note this point.

Of course, I agree with him that if a firm is willing to build, or have a factory built for it, either in Newport or in Swansea, it is better that the factory should go to Swansea. There may, however, be another firm which would put its factory either in London or Newport only. In that case it is better that it should go to Newport than that it should be built in London. Therefore, there has to be some judgment and flexibility in all this, and there is no case for having an absolute ban on any parts of Development Areas. It would help us to believe in the hon. Gentleman's conversion if he could tell us that that ban had been completely removed.

Mr. J. Rodgers

As I have explained on previous occasions, there is no ban on the erection by the Government of factory buildings in Development Areas. What we have done is to give priority to certain areas at this time—I enumerated them again today—because we believe they are in more desperate need than other parts. Therefore, we are not building factories in those other parts, but we have not abandoned factory building in those other parts.

Mr. Jay

May we take it, then, that the Government are prepared to examine applications for Government-financed building anywhere in the present Development Areas? Do I take it that that is so? The Parliamentary Secretary does not altogether give a straight answer when one poses a question to him. I say to him again that if he would give us a straight answer to that one, we should be even more convinced of his sincerity.

Secondly, can we have an assurance—I think this is even more important—that there will be no more of this effort to sell existing Government-financed factories to firms which do not wish to buy them? It is quite possible that there may be good reason, in some cases where a firm wishes to buy a factory, for the Government deciding to sell it, but to attempt to force a firm such as Huntley & Palmer to buy it, when it is unwilling to do so, is about the most foolish of all the Government's aberrations in these last three years. For this reason, and I hope that the Parliamentary Secretary will grasp it, if a Government-financed factory goes out of Government ownership and into private ownership, then thus far the Government lose control of employment policy in the area, because the firm may at a later date decide to sell it or use it for storage. Although it was originally built with public money, it can no longer be controlled, although that was the reason for using public money in the first instance. I hope that if the Parliamentary Secretary cannot answer that one yet, the Minister will very soon do so.

Thirdly, on this part of the argument, can we now be assured that the Government have completely abandoned the absurd condition that they would only go forward with Government-financed factories which would be completed by 31st October, 1959? It is quite obvious that if this is still in force no more Government-financed schemes can start at all. We assume that it is not in force, but we have not been fairly and squarely told so, and it would alleviate some of our anxieties if we could be told that tonight.

Next, on Section 3 of the 1945 Act, which relates to basic services, which is the direct concern of the Minister of Housing and Local Government who is to reply to the debate, can he tell us tonight that the Government have now abandoned the absurd condition that Section 3 even now can be used only in the case of schemes covering water and sewerage, and excluding transport, roads, and all the other services for which this was originally intended? Can he also assure us that applications will now be eligible from the whole of the Development Areas and free of these limiting conditions as was implied in the Government's original repentance on this issue back in March?

The Minister gave me a reply last week at Question Time on this matter which rather implied that he was disappointed with the number of applications that he had had from local authorities for grants under Section 3. But, of course, the reason for this is that road and transport schemes are far the most important among those which those areas want to carry out, and at present they are entirely excluded from the list. There is really no doubt, whether we go to South-West Wales, North Wales, or Tyneside, where, as my hon. Friend the Member for Jarrow (Mr. Fernyhough) said, the Tyne Tunnel and approach roads are still, apparently, held up and not started, that the schemes which local authorities most want to start are in the sphere of transport, and particularly of road building. Is the Minister prepared to say tonight that on Section 3 the Government will examine favourably any schemes which come under the definition as it was in that part of the 1945 Act?

Next, on derelict sites, to which the hon. Gentleman himself referred, I should like to say this. I think we cleared up that he is not now suddenly introducing a new condition. I gather they have either to be ownerless or derelict. That sounds a little less restrictive.

However, it is extremely disappointing, frankly, to have a reply from the President of the Board of Trade on 7th May confirmed today by the Parliamentary Secretary that no single scheme for the clearance of derelict sites has yet been approved. gather that there have been 50 applications since the Government gave way on this point three months ago. It is disappointing that nothing has been approved to date. Why this delay, and why is it that it has taken so long to approve any thing?

I urge the Government to press on here with the utmost energy. I hope we shall be told in particular that some of the notorious cases like the Landore Valley, Swansea, and some of the hundreds of acres of derelict land at Wrexham and in Lanarkshire are to be tackled at last under the Government's present scheme. If this part of the job is not to be tackled in that spirit, then I cannot agree with the hon. Gentleman that there is not a serious division between us over these issues.

The hon. Gentleman and others have referred to D. A. T. A. C., and we have been given some figures. We had the same ones from the Parliamentary Secretary today as were given to me in an Answer to a Question last week, which are, I think, extremely disappointing, and measure the consequences of the 1958 Act. When the 1958 Measure was published and was debated on Second Reading we on this side of the House said that, though we were all in favour of the use of D. A. T. A. C. and the extension of D. A. T. A. C., we believed it could make only a small contribution to the whole unemployment problem of these areas. It always takes the Government another year to learn these lessons, and I can only hope that they have learned this one, for the figures published today confirm what we said.

Ten months after the enactment of the Act the schemes approved provide only 1,700 extra jobs in the whole country. It is 1,700 jobs against 500,000 people unemployed. What the Parliamentary Secretary did not mention was that some part of that 1,700 would have occurred anyway, under D. A. T. A. C.'s ordinary operations, if the new Act had not been passed. Therefore, the new Act to date, although we are in favour of it for what it is worth, has provided only a few hundred jobs against a total unemployment of 500,000.

I just add this about D. A. T. A. C. Although it is normally the rule that the Government do not interfere with the detailed working of D. A. T. A. C. or take a view about the merits of particular schemes, I think it is within the terms of the 1945 Act that the Government can intimate to D. A. T. A. C. in general that they want it to be forthcoming, to take a reasonably liberal view of applications and to make the utmost use of its powers. I do not think that that, as my Scottish Friends would say, would be outwith the proper rules of order in this case. Here one's mind at once turns to the graving dock scheme on the Clyde which the hon. Gentleman mentioned. As here it is not questioned that the attitude of D. A. T. A. C. is absolutely decisive, I hope that we shall have some positive announcement about that before very long.

I will not make any long reference to Anglesey, because my hon. Friend the Member for Anglesey (Mr. C. Hughes) will speak later. But Anglesey is a case where the Government held out D. A. T. A. C. as very largely the solution of the problem, and they gave this as a reason for not including Anglesey in the Development Areas. But, in the whole ten months since the Act has been in force, every application from Anglesey has been turned down, as far as I know. That is why we cannot rely on D. A. T. A. C. alone.

On these points, which I have travelled over rather rapidly, we believe that the Government should act more vigorously than they have done so far. But I want to mention two other steps which we believe they should take. Again, I should be delighted if this process of conversion has gone quickly enough for them to announce acceptance of these suggestions tonight. It seems to us that the programme of only three advance factories now to be built is hopelessly inadequate. Not a single one is to go to the whole of South Wales, not merely the whole of South-West Wales. In particular, the failure at this stage to build a factory on the Fforestfach Estate is absolutely deplorable. Here is an estate laid out with public money fifteen years ago, with all services laid on and with sites ready for twenty to thirty new factories in the worst area, within reach of Swansea, Llanelly, Gorseinion and Pontardawe. It seems extraordinary to have a programme of advance factories and not to put one of them in that area even when the sites are ready. We have been told that care must be taken about standard factories because there is a danger of getting them left on our hands untenanted, but is it not true that, as my hon. Friend the Member for Dundee, East (Mr. G. M. Thomson) suggested, that the Coatbridge factory has found a tenant almost before building has started? We should like to know.

I should like to put this point to the Parliamentary Secretary in the light of what several hon. Members have said about the question of American firms coming to this country or being tempted to the Common Market. Is it not actual experience that the presence of an advance factory is a considerable bait to firms from America as well as firms in this country? I believe that if we looked at the records we should find that to be so.

Has any announcement been made yet as to where exactly the advance factory on Merseyside is to be placed? A look back over the history of the Development Area effort will show that the Birkenhead part of the Merseyside Development Area has not been very well treated throughout the whole story.

Mr. Collick

It has been shockingly badly treated.

Mr. Jay

The Birkenhead area has not a single industrial estate and it has great claims to an advance factory at the present time. As the other side of the river also has a claim, this is further evidence that three factories for the whole of the country are quite insufficient.

Secondly, and as my last practical proposal to the Parliamentary Secretary, I must say that we on his side of the House believe that the Development Area boundaries should now be widely extended, particularly in Wales, Scotland and Lancashire. I gave reasons in the debate on this subject last March why the last ten years' experience has shown that the boundaries should be more widely drawn. On that occasion, the Parliamentary Secretary in reply quoted from a White Paper of 1948, which was at the beginning of the ten-year period, giving the Government's reasons against such an extension. But my argument is that the experience of the last ten years has shown that that view is no longer valid. I urge the Government to learn, like us, from experience in these practical matters.

I will tell the Parliamentary Secretary quite frankly the reasons why I think that the intervening ten years have shown that wider scheduling is desirable. I entirely agree with the noble Lady the Member for Aberdeenshire, South that this argument about spreading the jam too thinly is completely false. There is not a limited amount of energy and resources which must be put in one area or another. The volume of energy and investment should be appropriate to the need all over the country.

Experience over ten years of this experiment has shown that the Development Area policy has demonstrably succeeded in certain of the worst-hit of the old areas. It has shown that the job can be done. Tees-side is an example of that. We have seen that other methods have failed in areas outside these boundaries, for instance, in North Wales and Anglesey, where other attempts to tackle the problem have unquestionably failed and the last ten months have shown that D. A. T. A. C. itself cannot tackle it.

Thirdly, we realise now, what I frankly did not fully realise in 1948, that in the rural areas, because of the mechanisation of agriculture, if new industry is not brought in on a large scale and if there is no big increase in food production, depopulation must go on. It is absolutely inescapable that that must happen. This is the lesson for large parts of Wales and Scotland, and this is why we should go ahead and try much wider scheduling.

Fourthly, we are now facing in both the cotton and the coal industries what looks like a major industrial, social and human readjustment. I wish that the Government would understand that this problem which we shall be facing in coal and cotton is essentially a geographical problem and therefore a problem of the distribution of industry. The simple fact is that if people lose their jobs because a mill or a pit closes down and if there is alternative work available within travelling distance, there is no irretrievable tragedy. But if there are no such jobs in the area there is tragedy, and a quite unnecessary tragedy which can be avoided, as the distribution of industry policy has shown, by foresight and intelligence, as has happened in certain areas. The decline of the Cleveland ore mines, for instance, has produced no problem because of the development of I.C.I. and other industry on Tees-side. This shows that the problem can be solved if it is tackled vigorously enough.

The Government's present policy for cotton, as announced in the last week or two, seems half a policy as it stands. Mills are to be closed and workers displaced, but there is no guarantee that new work will be brought to the right places at the right times to provide alternative employment. There is all too much reason to believe that a very big readjustment of this kind may face us in the coal industry before long, notably in Scotland, Wales and on the North-East coast.

This is not just a matter of giving aid to hard-hit areas but, as Mr. Ernest Bevin always looked at it, a matter of the distribution of industry over the whole country. I wish that the Government would try to foresee and make up their mind now whether labour will be released in these areas and at what time, in order that there may be a plan well in advance to ensure that alternative work is available. What we want is not just a policy for cotton but a plan for these industrial areas, not a policy for coal but a plan to ensure that one part of a change is interrelated with another. With foresight, knowledge and energy, I believe that can be done. If it is to be done, there will be far more resources in the hands of the public authorities if the whole of these areas, and, above all, the greater part, if not the whole, of industrial Lancashire and Cheshire, are brought within the ambit of full Development Area powers. Until the Government are ready to do that, I am not fully convinced that they are tackling this problem as vigorously as it could be tackled.

I urge the Ministers to think again quickly about all these matters and to act far more vigorously than they are doing at present. I welcome the conversion of the Parliamentary Secretary at least to a mood in which he says he is trying to do what we are asking him to do. If he will give proof of that by giving positive answers to all these questions, we shall be delighted, but if he cannot do that, I hope that my hon. Friends will urge him on to further conversion by voting in favour of this Amendment tonight.

8.1 p.m.

Mr. James Dance (Bromsgrove)

I have listened with very great interest to nearly all the speeches in this debate and in particular to the speech of the hon. Gentleman for Abertillery (the Rev. Ll. Williams). I agreed with much of what he said especially when he referred to the conurbation problem.

I feel certain that the Government's proposals to encourage new industries to be set up in areas where there is unemployment which is greater than the average for the country as a whole will commend themselves to hon. Members on both sides of the House and to people outside this House. I am certain that we shall all support the Board of Trade in the granting of industrial development certificates to further this end. I wish, however, to give a word of warning, with due respect, in the hope that these applications will be granted only to areas which really need this help and which through no fault of their own, but merely through what may be some change in user consumer demands or other reasons, have unemployment which is above the average.

At the moment there is a scheme afoot to extend the boundaries of the City of Birmingham, to take over 2,432 acres of the green belt, to build some 40,000 houses and to develop industrial centres there. Of that land, 1,880 acres are in my constituency in Worcestershire and 624 acres are in the neighbouring one of Warwickshire at Solihull. I should like to confine my remarks to my own part of the world round the Wythall which I know best, but I feel certain that similar problems and schemes exist throughout the country.

Most of this is fine agricultural land. It is not back gardens and chicken runs, but good open agricultural land which at present is producing milk, fattening cattle and growing good crops. It would be a terrible thing if this land were unnecessarily—and I hope to show that it would be unnecessarily—taken away from agriculture.

In addition, this land is part of the green belt. I believe that the green belt should be sacrosanct. What is the point in one day setting up a green belt and then later allowing schemes of this magnitude to encroach on to the land? We must bear in mind that the people in that green belt who own their own property find it difficult to get permission to build garages, etc. If they cannot do that, it is surely entirely wrong to allow these schemes to burst into the green belt from the cities.

In addition to the considerations of agriculture and the green belt, there is the social aspect which we should take into account. People have of their own will and on their own initiative moved from cities and towns into the green belt because they wanted to go into open spaces and because they felt that it would be safe to go there and that they would be left alone. They have bought properties for which they may have paid quite a lot. I know that it may be a selfish attitude to take, but it is perfectly true to say that were these great building schemes of factories and of 40,000 houses to be brought there, the value of their land would undoubtedly fall. I think that would be a very great pity.

Above all, there is a community feeling which has grown up over many years in this type of area and I think that it would be disastrous if that were killed. In addition, I believe that the people who go there, many of whom will be forcibly removed from their own cities, will be very unhappy and will seize the first opportunity, if development takes place in the cities from which they came, to go back to them. During the war when the blitz was on Coventry we housed people from Coventry in our village. It is not a remote village; it is a large village. It had good shops in it and several pubs. Yet, after a few weeks, these people decided to go back to Coventry. They would rather face the bombing than be away from their own kith and kin and the place where they had their roots.

It is perfectly true that there are many people in these cities who need housing or, in some cases, rehousing. We must face that fact. It would be inhuman not to do so. Having spoken to those citizens who know the City of Birmingham intimately, I am convinced that the major portion of this housing problem could be dealt with by Birmingham within the confines of that city. There may have to be minor schemes in this connection, but do not let us forget that people are at present, and have been for some time, moving out of their own free will. I think that that process will continue.

Certainly, we must do something to help to house these people, but I am convinced that in the City of Birmingham, and no doubt in other places, the problem could be dealt with largely within their own cities. Therefore, I implore my right hon. Friend to see that when these certificates are being issued they go to places where they are really needed. For many years now the part of the country to which I am referring has fortunately had virtually full employment. Therefore, if these schemes of industrial development are to be worth while, I hope that they will not be allowed to encroach into the green belt but that they will be taken to places where they will give benefit, where the workers will be given good jobs and where they will really be welcome.

8.9 p.m.

Mr. William Ainsley (Durham, North-West)

I welcome the opportunity of expressing the hopes and the fears of the people in the North-East. During an Adjournment debate a month ago, I referred to it as that part of the country which is often forgotten and neglected by this Government, whether it be in industry or in the social services. The reply I received from the Parliamentary Secretary on that occasion reveals the attitude and approach of the Government to these problems.

It is rather strange, when we examine the present position, to find that it is following almost the same pattern as in the 'thirties, when many of us experienced the hardship and the cruelty of being not wanted in society. If we examine our heavy industries, we find exactly the same pattern reappearing today in shipbuilding, ship-repairing, iron and steel, coal and quarrying. We are faced with this problem because of the Government's policy of freedom.

I recall that during the war research was undertaken on our mineral wealth in order to exploit to the full our natural resources, and a report was published in 1948. I was advised of that report by the Lord President of the Council, and when I examined it I found that it referred to my own area. Following that report, during the last few months the Institute of Mining and Metallurgical Research has published a survey on my constituency in which reference is made to its natural wealth. The question I want to put to the Parliamentary Secretary to the Board of Trade is, how far are the Government prepared to give financial aid for boring and for further exploiting this natural wealth?

I have put repeated questions to the Government and have been told, "You are not in a D. A. T. A. C. area". Yet we are in a Development Area. If we follow the pattern of Development Areas since the Distribution of Industry Act, 1945, we find that some progress was made under the Labour Government and that in the two succeeding years the Tory Administration reaped the benefit of that Act. Yet, when I approach the President of the Board of Trade, either when on a deputation or by a personal interview, I am told, "We cannot direct industry to those areas".

Let us examine the position. For miners their employment is limited, since the mine may close and, although the Government cannot direct industry, economic pressure may move the miners into other areas. Therefore, in our national economy a mining community is an economic unit and the Government have some responsibility for the dilemma of the National Coal Board. We know that the Government have never looked favourably on any nationalised industry. Even now, Mr. Hurry is going round asking the question, "Do you wish for more nationalisation?" This question is a subtle one, because the present Government are deliberately creating an economic position which prevents our nationalised, basic industries from functioning successfully.

The coal industry needs the Minister of Power to accept responsibility for carrying on the national services in the interests of our national economy, but the belief in competition is bringing more distress to the special areas, as is shown by the following figures for my own county. In September, 1957, the total number of unemployed was 9,697. In December it went up to about 11,000, in March, 1958, to 14,000, in June to 15,000, in September to 17,000 and in December to 21,497. That is a creeping paralysis which is attacking the Development Areas in which are our basic industries. This Government, relying upon the Cohen Report, have deliberately created unemployment, which is growing like a snowball and is creating the problem they cannot control.

Let us take note of what the Paymaster-General said in our recent debate on mining. The right hon. Gentleman said that the Government would close no more pits this year. That sounds so nice, does it not, to the general public, but what does it mean? It means that things will go on as they are until the election and immediately afterwards, the problem will have to be faced by the next Government. We cannot continue to produce and stack coal unless there is a market for it. That is the problem facing the mining industry in my constituency.

This weekend a brickworks is closing in my constituency. Is there no need of bricks? We have bricklayers idle, we have joiners and carpenters idle. People need homes, we need schools we need hospitals. If the Government wish to extend the economy of this country, they can do so, but they do not want to do it. Their policy is unemployment so that they can control the worker in industry. I have had some of it, so I know what I am talking about. I have been told, "If you will not do it, there is a man in the unemployment queue who will come and take your job". That has been Tory policy over and over again. Let the Government reveal what they intend to do to meet the growing problem of unemployment, of recognising human values, of looking after young people leaving school, instead of talking about introducing whipping and flogging to deal with juvenile delinquency. That is the mentality of the people sitting on the Government benches.

There is a school in my constituency from which 1,000 young people will soon be coming on to the employment market. There is no work available for them. If the Ministry of Labour cannot provide them with work, the Ministry of Education must accept some financial responsibility and keep these young people at school.

The Board of Trade is not prepared to help industry. I have pointed out a factory that is standing idle in my area. It is not in a D. A. T. A. C. area, yet we have a figure of 8.6 for juvenile unemployment. The Government will not give financial assistance to make use of this factory so that the talents of these young people can be put into the right channels and they can become useful citizens.

These are the human problems that we have faced all our lives. We know about human depredations, but until we get a change of society and place man in his rightful place, these problems will continue. May the time speedily come when the answer will be given to the Government which, with all their financial resources and backing, their record from 1951 to date and the way that they have handled the nation's affairs has brought us from the vanguard that we were in for generations down to a second rate nation today.

8.22 p.m.

Mr. Robert Mathew (Honiton)

I wish to draw the attention of the House to a very different area from that mentioned by the hon. Member for Durham, North-West (Mr. Ainsley). I should like to echo the words of the Parliamentary Secretary and stress that this is a problem which must be taken out of party politics. When one listens to some hon. Members opposite—in particular to the hon. Member for Jarrow (Mr. Ferny-hough), to whom I always listen with close attention, sympathy and respect, and to the hon. Member for Durham, North-West—one sees all the ghosts of the dark days of 1929 to 1931 being evoked in debate after debate over the years. When one listens to hon. Gentlemen opposite one would not recognise what the employment and economic situation is now. Any stranger coming into the House would not believe that the rate of unemployment is 2.4 per cent. of the working population.

Mr. Hayman

Might I suggest to the hon. Gentleman that if he had lived in an area of high unemployment where one-third of the working population was out of work he would feel that the high unemployment in local areas of the country today is frightening in the extreme?

Mr. Mathew

The hon. Gentleman's intervention is hardly relevant to what I was saying. I was dealing with the national position as reflected in the speeches of hon. Members opposite. I have intervened to deal with the problem envisaged in the Amendment tabled by the hon. Member for Abertillery (The Rev. Ll. Williams). The problems we are concerned with are the pockets of unemployment throughout the country. I object to the debate being made a party forum for hon. Members opposite to bring out the speeches which they have been making for the last thirty years.

The problem to which I want to draw attention is that of the Development Areas in the south-west of England. It may come as a surprise to some hon. Members who think of Devon and Cornwall as tourist areas, as pleasant places in which to spend a holiday and as very pleasant places to retire to, that there are a number of Development Areas in both counties.

This problem does not arise from the same causes as those which apply in a number of areas to which hon. Members have referred. The reasons are, to a large extent, historical. The latest details for the two counties showed an unemployment figure of 5 per cent. in April, and during the deep winter months it rises higher. This battle of unemployment goes back many years. It is a deep-lying social problem. Historically the area has an economy based on the great traditional industry of agriculture but in the towns, and especially the seaside resorts —and I represent these areas together with a number of other hon. Members—it is based on the tourist and holiday industry.

Before the Industrial Revolution there was a much more balanced economy in the West. In the small towns one had industry side by side with agriculture. There was no coal in the West, and when the Industrial Revolution came industry was concentrated in great units in what the hon. Member for Abertillery referred to as the absurd concentration of industries in the large congested areas, and the small industries in the towns of the West fell by the wayside with the march of progress.

In the smaller towns in the West today there is a certain unbalance in the economy. This is not caused by the same factors which have caused the difficulties which are occurring in the industrial areas that have pockets of unemployment-Such things as a major change in the industrial direction of the nation, where we as a great trading nation have to change the direction of the impact of our manufacturing effort, do not affect the West directly.

The general redeployment of industry, a problem to which hon. Members have referred, does not affect us so much. Indeed, the general world trend has not quite such a direct impact on the economy in the south-west of England. I am speaking of the smaller towns where in recent years employment has not been so easy to obtain, even in periods of very full employment in the rest of the country. The reasons for this are, as I say, partly historic and partly that in the towns, and especially in the seaside towns, the main industry is the hotel and catering industry, which is essentially seasonal.

Taking the town of Exmouth, in my constituency. which since January has been scheduled as a D. A. T. A. C. area, and comparing the unemployment figure in April of last year with that in August of last year—that is to say, comparing the last month before the beginning of the holiday season with the peak of the holiday season—there was a fall of 1.7 per cent. in registered unemployed. That has been the situation throughout the years. We have this differential caused by the simple fact that the holiday industry is seasonal.

The next reason for our problems is, I suggest, that the area is extremely pleasant, with lovely countryside and a good climate, and we are very happy in the South-West to welcome large numbers of people who, having completed their working lives, come to live amongst us in their retirement. The problem is that the families and children of these people have little choice of employment. They must either go into the countryside, as we hope they will, and enter agriculture, or, as more of them do, unhappily, they must go to other parts of the country where there is a greater diversification of jobs.

The inevitable result is that there is a tendency for the average age in many of the towns in that area to increase year by year. The picture of the age of the population, especially in some of these resorts, is very clearly presented by drawing a graph comparing the figures from the 1921 census with those in the 1951 census. The shape that one gets on the graph is like an hour glass. That is to say, there is a broad base representing the young people under 15 years of age still at school, and then there is an increasingly slender and elegant waist representing those who have remained in the towns during their working years. Then there is a top-heavy bulbous head —the top of the hour glass—which represents those who have retired at 60 or 65 and upwards.

This is not a healthy tendency for any community. The basic need is for more diversification and for the introduction of light industry. This is clearly not an area for large industrial units or anything in the nature of heavy industry. But the need for diversification is very urgent, and I submit that it arises from reasons rather different from those which apply to other areas which have their own peculiar problems and which require industry of all kinds.

The Board of Trade has now recognised the need that exists in Exmouth, in my own division of Honiton, and a number of other centres in Devon and Cornwall. A number of people in the areas who are concerned with this problem are very grateful to the Parliamentary Secretary who, at the end of January, came down on a tour. He met representatives of all the areas, he held meetings with trade union leaders, and he informed himself of the specific problems of the area. I have heard a number of complimentary remarks from all types of people, who are most grateful to him for explaining the intricacies of the D. A. T. A. C. procedure and its possibilities for the area. A great deal of clarification resulted.

Since January a number of applications for assistance have been made in my own area from the D. A. T. A. C. committee. The results of the applications are still anxiously awaited. I understand that the total number of eligible applications for East and South Devon amounted to twenty, of which one has been approved so far and fifteen are still being considered. I would express the hope that the outcome will be fruitful and, above all, will be not too long delayed. In the whole of the two counties, certificates have been given during the eight months from August last until March to twelve factories or extensions. The twelve projects now amount to 122,000 sq. ft. That is progress in the right direction.

I would direct the attention of the Parliamentary Secretary to the particular needs of East and South Devon. A number of firms have started up in that area on their own and there have been satisfactory expansions in the last two years. I had the pleasure fairly recently of opening two new bays in an electronic works at Ottery St. Mary. Hon. Members who know the place will be aware that it is not at first sight a likely place for an important electronics industry, but this has been a very great success and has prospered. All those who were responsible for it, and other people who have started up light industries similarly, are very satisfied. I have always had the same reply that they are gratified at having moved into an area usually more associated with summer holidays than with light industry. They speak extremely well of the quality of the labour in what is really a rural area, and of the amenities which are available.

I stress these points, since the Parliamentary Secretary mentioned in passing about firms being reluctant to move to certain areas in the country. He mentioned Cornwall among other places. I would remark, in the presence of the hon. Member for Falmouth and Camborne (Mr. Hayman), that I do not think there is the same reluctance on the part of firms to move to East Devon that there is to move to Cornwall.

The trouble about the specific problems of seaside resorts is that there is a short summer season. Many places in the West should have a very much longer summer season. Some, like Sidmouth, in the urban district of which I live, are admirable winter resorts, and have been so for many years. The summer season is being gradually extended, and I submit to the Board of Trade that a nation-wide effort should be made to spread holidays over a longer period. It would confer many advantages on all concerned, including the holidaymakers themselves, on the economy of the country, and, not least, o n those who are working in the tourist industry, which is thoroughly overloaded during the peak months in all these resorts.

Here is one of the greatest of our foreign currency earners. I hope that, in winding up the debate, my hon. Friend can tell us some of the details of the help which is specifically available to the tourist industry under the D. A. T. A. C. procedure for hotels, for re-equipping hotels, building new hotels, for catering establishments and other tourist attractions ancillary to this industry. It is important that this industry, which suffers to a large extent from certain elements in the tax structure of the country, but which is doing a first-rate job in bringing dollars and other foreign currency to the country, should be given every encouragement. Everything should be done to attract fresh capital.

In conclusion, I express the hope that the Government, in speeding help to the Development Areas in the West of England and above all by attracting light industry to those areas where it will be very much welcomed, will always remember that this is a long-term problem arising partly from the historic reasons I have mentioned, which are basically different from the difficulties in some industrial areas of which we have heard in this debate. It is absolutely essential that the unbalance which has arisen in the economy of the smaller towns on the West of England should be set right so that young people do not drift from home as soon as their school days are over. I say to the young, enterprising industrialist, perhaps setting up a small-scale new industry and looking for a suitable site and location, "Look West, young man" because that is where there is a future for industry which there has not been perhaps for 150 years.

8.42 p.m.

Lady Megan Lloyd George (Carmarthen)

The hon. Member for Honiton (Mr. Mathew) has complained that he has had to listen to the same speeches on unemployment from this side of the House for many years. I am afraid that he will have to go on listening to speeches on unemployment while the problem lasts. I may also tell him that we on this side of the House have had to listen to the same speeches on unemployment from his side of the House, speeches telling us that the problem is not nearly so serious as we make it out to be, speeches telling us that the Conservative Government of the day are doing everything that is possible to be done.

We heard one of those speeches today from the Parliamentary Secretary to the Board of Trade and a very disappointing speech it was. It showed how pathetically, how tragically inadequate the policy of the Government is to deal with the problem of the Development Areas. It reflected far more accurately the policy of the Government than the very skilful and dexterous juggling of figures we had from the Minister of Labour a few weeks ago. The Parliamentary Secretary said he would throw himself on the mercy of the House. If he cannot do better than that, I warn him that he will get no mercy and no quarter from this side of the House.

The Parliamentary Secretary dealt with the technological changes and more or less said they were the main cause of the present situation. Of course, nobody wants the clock to be put back. All we want is intelligent anticipation. These developments are well known, or if they are not, they should be well known, to the Government — such developments, for instance, as in the steel and tinplate industries in South West Wales and other parts of the country, and in the coal industry. The way in which the Government mishandled the situation in the coal industry gives us no confidence at all that we shall get from them much intelligent anticipation in the matter of technological changes. This is vital for the Development Areas, because coal is still the most important common denominator to all these Development Areas in Scotland, the North of England and Wales. If the Government have not thought about this problem until now, we ask them to do so before further mines are closed and more miners become redundant.

Government spokesmen try to make out that there is no radical difference between the Government's policy and that of the Labour Party. In fact there is all the difference in the world. First—and it cannot be said too often—we must not forget that the Government virtually abandoned the Distribution of Industry Acts for two years. The Government have given us figures which show that the average yearly factory building from 1951 until now was £4 million a year. If that is so, then their suspension of the Distribution of Industry Acts means that over £8 million of Government factory building which could have taken place in this country has not taken place.

The Government have had a change of policy and a change of heart, and they have now brought the Acts out of cold storage. Do they intend to make greater use of their provisions? From what we have heard in the debate today we realise that they are not making full use of these provisions. They keep telling us about the difficulties. The Government tell us, "We cannot use compulsion. We cannot compel industries to go into the Development Areas." The fact remains that since 1945 350 new industries have gone into Wales, and a larger proportion of them were steered there under the Distribution of Industry Acts. There was no compulsion, no direction of labour and no direction of industries. Yet these industries were steered into Wales, as others were steered into other Development Areas. We say to the Government, "Now that you have brought the Acts out of cold storage, make full use of them. First of all, use the negative power, which is a formidable power."

We had some interesting figures this afternoon from my right hon. Friend the Member for Battersea, North (Mr. Jay), who told us that in the first three months of 1958 the amount of industrial building in the London area was 15.8 per cent. of the national total and that in the first three months of 1959, after this great change of policy, it was again 15.8 per cent. In other words, there was exactly the same amount of industrial building in the London area. For the Development Areas, into which the Government were to steer industries, the figure for the first three months of 1958 was 22.6 per cent., and for the first three months of this year it was 22.7 per cent. That is the measure of the success of the Government's policy.

I am glad to see the Minister of Labour on the Government Front Bench. A few weeks ago he said that virtually no authority is given in the Greater London area for a "purely new factory". Yet the figures for the first three months of 1959 are exactly the same as for the first three months of 1958–15.8 per cent. I hope that we shall have some explanation of that later in the debate. What is a "purely new factory"? No light has been thrown on that in the debate. It is time that we had a more precise definition. The right hon. Gentleman said that extensions are quite a different matter and are in a different category. Are all the new developments which have taken place in London regarded as extensions? Or are they "purely new factories "? When is an extension not an extension? May we have some information on that tonight? Was the factory of British Nylon Spinners in Gloucester an extension or a "purely new factory"? It seems to me that one could drive a bulldozer through the Government's definition of "extensions" and "purely new factories".

It was very interesting to note when the Parliamentary Secretary spoke today that he has changed his tune considerably. He patted himself on the back all through Wales. He made himself dizzy in the process. He was so carried away by the exuberance of his own verbosity that he said that Wales might soon be embarrassed by industrial development. We have felt no embarrassment up to date.

The Government claim that they will provide substantial employment in Wales. They say that they will produce 11,000 new jobs. How many of those new jobs will be West of Swansea? That is the most intractable area in South Wales at present. I do not speak of North Wales, for which my hon. Friend the Member for Anglesey (Mr. C. Hughes) will speak later. We have heard of Pressed Steel going to Swansea, and we are delighted about that What other projects are coming? Are there any projects in the Amman Valley, for instance, where the life of the whole community is threatened by the closure of the pits as well as by closures in the tinplate industry?

We on this side of the House ask the Government to tell us what new building projects they propose in the Development Areas. This is a considerable inducement, because industrialists do not want to have to tie their money up in bricks and mortar; they would far rather put their capital into plant and machinery. Therefore, it is far better for industrialists to be able to rent factories than to purchase them.

As far as I can make out, there are to be three advance factories: one in Wales, one in Scotland and one in England—not one in South Wales. My right hon. Friend the Member for Battersea, North specifically asked whether the Government were lifting the ban on factories in other Development Areas. The Parliamentary Secretary did not seem to be very clear whether that ban had been lifted. I am very glad to see that the Minister of Housing and Local Government and Minister for Welsh Affairs will reply to this debate, and I hope that he will tell us something about it.

I want to raise a point about Section 3 of the Distribution of Industry Act, which gives power to make grants to local authorities for special services. Loans, I understand, were originally meant to be for roads, water, power, light, heating, housing and health services. Now the schemes are to be confined to water and sewage. What has happened to all the other services for which originally loans were to be made under Section 3? Are there no loans or grants to be made for these services? It is absolutely essential to include roads in this category for special grants.

I know that the Government tell local authorities that they are free to go ahead with road schemes, and that the Government will give them sanction, but not much in the way of loan. In point of fact, in Carmarthen out of seventeen grant schemes for road improvement which have been put forward five have been approved, which means that we have had about £26,000 out of a possible total of £140,000. If that is the scale upon which approval is to be given, it will not get us very far.

This is not a question simply of making work. These schemes are a form of national investment. All these services are vital. When, in the 'thirties, we asked the Tory Government of the day for works of national development, we were told, "You are asking us to make holes and then fill them up again." Well, there are quite a number of holes in our roads now that could do with filling up. This is an echo of the past. It is an echo of the same old attitude.

Let the Government use the powers they have. Let them use the negative powers. Let them approach this problem with a new drive, and a new sense of decision and purpose, and let them approach it with a new spirit to bring new hope to these people who have lived long enough under the shadow of unemployment.

8.54 p.m.

Mr. Paul Williams (Sunderland, South)

Earlier in the debate, the hon. Member for Durham, North-West (Mr. Ainsley) referred to the policies now being initiated by the Government as being similar to those of the 'thirties. Late, he spoke of an attempt on the part of the Government deliberately to create unemployment. The hon. Lady the Member for Carmarthen (Lady Megan Lloyd George) has taken a similar, though less extreme, line. I do not propose to apply my strictures deliberately and directly to her, though I will to the hon. Member for Durham, North-West.

I regret that the hon. Member is not here—since he was so provocative—but I say that he was speaking not only arrant nonsense but was being deliberately wicked about this as well, and I will adduce certain reasons for saying that. I would recall, as he and other hon. Members opposite have recalled, the period of the 'thirties—except that I would amend that. and start from 1929 onwards—

Mr. Gordon Walker (Smethwick)

On a point of order, Mr. Deputy-Speaker. Is a reference to the speech of an hon. Member as being "deliberately wicked" in order?

Mr. Deputy - Speaker (Sir Gordon Touche)

I think that the expression "wicked" should be withdrawn.

Mr. Williams

Then I will withdraw the words "deliberately wicked", and, instead, say that the speech was mischievous in the political sense and extreme in its tone.

If we are considering the position between the wars, we can do it realistically and reasonably from 1929 onwards. Those of us on this side who are younger need to bear a special responsibility and thought for the past, and to remember the bitterness that came from those years of depression; to learn the lesson from that period—and the cause of the depression, too, and the party that was in office at the time.

There was unemployment, there was fear and there was bitterness. Much of that still exists, as everyone in the House knows perfectly well. But let us also recall two additional facts. Let us recall first of all, that in 1935, in the North-East —in Wallsend, Sunderland and The Hartlepools—Conservative Members were elected to put this matter right. That is why I relate this matter particularly to the North-East, and to the "distressed areas", as they were then called.

I call in evidence a second fact. Last year, there was celebrated on the Team Valley Trading Estate the 21st birthday of the great experiment that we are really debating today. This surely shows that whatever may have been the reasons for or the causes of the fears, the depression and the bitterness. it was. in fact, in the years before the war that the foundations of this new policy were laid, and have been built on since. It is most unreasonable of hon. Members opposite to pretend that everything was evil until 1945. It was not.

We are all very happy that during the post-war years there was full employment and, we believe, improving conditions of living. There grew in the minds of my generation, at any rate, a feeling of security, permanent for all time. Sooner or later, however, one has to face the harsh facts of life. Britain cannot survive and cannot maintain a high standard of living unless we can produce competitively goods which will sell abroad. This is true whether one is speaking of a D. A. T. A. C. area. a Development Area, the London area. Honiton or anywhere else. We must be able to produce effectively and efficiently. This is the key to the standard of living of our people today whether they live in a Development Area or elsewhere.

We were recently hit by the United States trade recession. I believe that we should have taken other actions in economic matters in the way we trade in the world, and we should have done certain things earlier. But there came the United States trade recession, and, consequently, a decline in British trade and an increase in unemployment. It is surely monstrous to suggest that this unemployment was deliberately created by Her Majesty's Ministers. Putting it at its very lowest, what political bonus can there possibly be in creating unemployment? I cannot understand the warped reasoning of hon. Members opposite. It is really nonsense and twisted thinking.

We must, nevertheless, remember that in the ex-distressed areas, these presently termed Development Areas, there are considerable fears for the future.

Mr. Marcus Lipton (Brixton)

Will the hon. Gentleman tell us why?

Mr. Williams

I will tell the House why. We must face the fact that these fears exist, but we must realise that we are sometimes carried away in this House, whether it be on the one side or the other—perhaps attacking the Government from that side or supporting them from this—and we tend to lose the balance which comes from being a little further from the party political fight. I will quote a few remarks made by Mr. Gibson at the recent annual meeting of the National Union of Seamen. I take this from a report in the Sunderland Echo dated 13th May: There was a brighter side to the picture, however, Mr. Gibson said, and it was pleasant to know that optimism prevailed in both heavy industries and shipping circles on the North-East Coast. Orders were in hand for larger and better vessels, dry docks were being enlarged and new ones built to accommodate vessels over 60.000 tons. On the Tyne the keel had already been laid for a small super passenger liner. All these signs give me ', he said, immense hope that we shall soon have prosperity on the move, and it may not be long before the three rivers become a hive of industry.'". I will be fair with the House. Mr. Gibson goes on to enter certain reservations about the shipping industry, and the shipbuilding industry, as well should be done.

Mr. Hector Hughes (Aberdeen, North)

I was present at that meeting, and the extract that the hon. Gentleman has given does not give a fair representation of the argument.

Mr. Williams

If the hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) wishes, I will read the next sentence, which may meet his point. Mr. Gibson added: It has been nothing less than tragic to see new vessels coming off the stocks and immediately being sent to the laying-up berths owing to the lack of charters. That was the point I was going to make when I said that he went on to say some critical things about the shipping industry and the shipbuilding industry. I agree that I did not give the whole thing, but we have a clock here.

Mr. Hector Hughes

I still say that that is not a fair representation of the argument.

Mr. Williams

The hon. and learned Gentleman may think that. Later in the debate, if yet another Scotsman can be called, it may be possible for him to present his view.

We must maintain some balance about this issue. We now see a revival in the United States economy and we see at least the beginning of a revival in the movement of goods across the oceans. This does not really show us yet that the shipbuilding industry, for example, is beginning to recover. Certainly the shipping industry is showing no signs of recovery at this stage. Some hon. Members opposite and certainly some on this side have considerable fears and concern about the future of the shipping and shipbuilding industry. That is why I was particularly happy yesterday to hear the remarks of my right hon. Friend the Minister of Transport and Civil Aviation about the representations which we shall make to the United States Government about their flags of discrimination and flags of convenience policies.

It seems to me that in a large number of the Development Areas we need to look to the basic industry of the area first for providing a high and stable level of employment. That is why I put my greatest hope in a revival of the shipping and shipbuilding industry. It is here that the stimulus is needed first. In terms of the Development Areas, surely the second priority must be to restore the existing industries to the highest possible level of production. The third priority, and it is important, is to bring in new industry.

I agree with the remarks of my hon. Friend the Member for Aberdeen, South (Lady Tweedsmuir) when she says that there should be a combination in Development Areas to promote the interests of those areas. It would be so much better if the hon. Member for Sunderland, North (Mr. Willey) and for example, could go on a platform together to advocate the benefits of coming to Sunderland, in particular, and to the North-East in general.

Mr. Wiley

How does the hon. Member square that with his own present endeavours to persuade British capitalists to divert their capital to France? I should have thought that we should concentrate on getting British capital into the Development Areas so that new factories can be built.

Mr. Deputy-Speaker

I hope that this dispute will not be too prolonged, because other hon. Members wish to speak.

Mr. Williams

I will try to meet that point as quickly as possible, Mr. Deputy-Speaker.

The hon. Member for Sunderland, North knows perfectly well that the Common Market is a fact of life. It may or may not be regrettable, but it is not such a bad thing to try to get British industry into a position where it can compete on the Continent. We can take this matter further at some other time.

In conclusion, the first priority in the North-East is to restore the prosperity of the shipbuilding industry. The second is to restimulate the industries which already operate in the Development Areas. The third and important priority is to bring in new industries. In addition, I should like to ask my right hon. Friend the Minister of Labour and National Service to come to the North-East to get the flavour of the climate there, to see how concerned people are about the future and to help them to see the problem in a balanced and even way.

9.8 p.m.

Mr. Cledwyn Hughes (Anglesey)

I should like to join hon. Members who have congratulated my hon. Friend the Member for Abertillery (The Rev. Ll. Williams) on his good fortune in the Ballot and upon the powerful and lucid speech which he made. I should also like to congratulate my hon. Friend the Member for Greenock (Dr. Dickson Mabon) on his lucid contribution. My hon. Friends have enabled us to have a debate upon a subject which is of great importance and is constantly in the minds of us all.

A good deal has been said about the general unemployment situation. This is natural and proper, because we cannot divorce the Development Areas from the general economic background. We on this side of the House, and, indeed hon. Members in all parts of the House, are relieved that the unemployment figures are down. We hope that they will continue to decrease until we achieve full employment once again.

Before I refer specifically to Development Areas, I should like to take up one point made by the Parliamentary Secretary to the Board of Trade which was referred to by my right hon. Friend the Member for Battersea, North (Mr. Jay). The Parliamentary Secretary spoke about the figure of those in employment compared with the figure of those unemployed. I have had a look at the figures from the Ministry of Labour and National Service since the hon. Gentleman spoke, and I find that in March and April there was a decline of 58,000 and 20,000, respectively, in the unemployment figures. But, on these dates, we were not supplied with figures showing the full number in civil employment.

The figures for the end of January, if I am not mistaken, should show that the registered labour force declined by 62,000 in that month. This was more than the drop in unemployment figures. From the end of December to the beginning of March, the number of people actually in work fell by 80,000. From then to the middle of April, as I see it, unemployment was reduced by 30,000. At that time, therefore, in April, there were 50,000 fewer people at work than at the beginning of the year. That was the true position. In other words, it is the unemployment register which looks healthier and not the employment situation.

This is an ominous trend. It may have grave consequences if it continues. The Minister of Labour and National Service is now well known for his predictions about the unemployment figures. Can the right hon. Gentleman inform his right hon. Friend the Minister of Housing and Local Government and Minister for Welsh Affairs, who is to reply to the debate, how far this trend will go? We all realise that if it persists it will be serious from a production point of view, if from no other.

Many hon. Members have drawn attention to the figures within the Development Areas. The figures of 4.5 per cent. in April compared with 2.4 per cent. for the country as a whole have been quoted, and the fact that long-term unemployment among men is higher in the Development Areas than in the whole country. My hon. Friend the Member for Abertillery referred specifically to the position in Wrexham, which is causing grave concern in North Wales. There, 53 per cent. Of all the men of 18 and over who are unemployed have been out of work for over six months. In South Lancashire the figure is 36 per cent., and the figure for Great Britain as a whole is just under 26 per cent.

One thing is abundantly clear. It is that the Development Areas are still much more vulnerable in the face of a recession than are other areas. That is the salient fact which has emerged from our debate. It has taken a recession to bring home that truth to the Government. All sorts of figures can be produced to prove all sorts of things. But the fact is that the share of the factory floor space which went to the Development Areas has fallen under a Conservative Administration. As many of my hon. Friends have pointed out, this has happened in a favourable economic climate and not in the same circumstances that obtained in the harsh and difficult years following the war. Notwithstanding the difficulties of those days, during the first four years after the war over 50 per cent. of the factory floor space was provided in the Development Areas by the then Labour Government. From July, 1945, to September, 1951, 12 per cent. of all approvals of factory floor space was in London and the South-East. Since 1951, the figure has risen to 18½ per cent.

I am glad that the Minister of Housing and Local Government and Minister for Welsh Affairs is replying to this debate for the Government. In Wales since 1951 the share of approvals for factory floor space has fallen from 9 per cent. to just over 4½ per cent. When the right hon. Gentleman speaks about Welsh affairs we hear glowing reports of what is going to happen in Wales, that more work will be provided. The fact is that unemployment is still high and the problem has not yet been solved. Certainly we feel that the Conservative Government, ever since the first Conservative Administration took office after the war, in 1951, have had no enthusiasm for Development Area policy.

The abandonment of Section 3 of the 1945 Act in 1952 has been mentioned. There was also the statement of the Minister of Health, who was then Minister of State, Board of Trade, to the House on 5th June, 1956, when he announced that the Government had decided to defer consideration of all proposals for the provision of new Government-financed factories or extensions under the Distribution of Industry Act, save in a few cases of special importance and urgency. What is interesting and significant about that statement is that at the same time the Select Committee on Estimates was making an inquiry into the Development Areas, and on pages xxi to xxii of its Report we read this: Witnesses from the Board of Trade argued that, in considering the future of the Areas, regard must be had not so much to current figures of unemployment as to future economic prospects. They claimed that … they are still too dependent on their basic industries which have been proved in the past to he subject to severe and sudden unemployment. Secondly, some industries in the Areas appear to be declining. They instanced the hand tin plate mills in South Wales. That was prophetic evidence by civil servants of the Board of Trade. That is precisely what has happened in recent months, because when the recession came the Development Areas suffered more than the rest of the country, yet when the Board of Trade officials were issuing this warning in the spring of 1956, the then Minister of State, Board of Trade, at that Box was calling a halt to all activities in the Development Areas. It is a tragedy that he did not heed the words of his own advisers.

It is clear now, clear to us on this side and, I am sure, clear to hon. and right hon. Gentlemen opposite, that what was needed then was not a slowing down of building in the Development Areas but an acceleration of building so as to achieve the objective of not being over-dependent upon one or two basic industries. If there had been more building, the effects of the recent closures of coal mines would not have been so acute.

My right hon. Friend the Member for Battersea, North and my hon. Friend the Member for Abertillery were right to go back to the source and to remember what exactly the Distribution of Industry Act, 1945, was expected to achieve. My right hon. Friend the Member for Bishop Auckland (Mr. Dalton), moving the Second Reading of the Bill, said it was intended to promote a healthy and well-balanced industrial life in all parts of the country." — [OFFICIAL REPORT, 21st March, 1945; Vol. 409, c. 837.] Winding up the same debate, the noble Lord, Lord Chandos, who was then Minister of Production, said that it seeks to control … what I may call the further industrialisation of certain areas."—[OFFICIAL REPORT, 21st March. 1945; Vol. 409, c. 940] Those two quotations sum up what was then the current view of what the Act was intended to achieve. They take us back to the unbiased source of all recent inspiration in this subject, the Report of the Barlow Commission. The unpalatable truth which the House has to face tonight is that twenty years after the Barlow Commission and fourteen years after the Second Reading of the Distribution of Industry Bill in 1945, we still have acute congestion in the industrial conurbations and we still have areas of high unemployment in Great Britain. In other words, if we take an objective over-all view of the situation, we find that we have not achieved what it was intended should be achieved by the Act.

Obviously, it would be wrong and uncharitable of me not to pay tribute to those who have worked hard to make the Development Areas the success which they are in one sense, and particularly not to refer to the work of the Labour Government after the war. [Interruption.] Indeed, the figures prove it. We on this side of the House say that it is a great pity that the tempo of the drive and enthusiasm was not maintained under Conservative Governments after 1951. Both the congested areas and the Development Areas would have been far better off today if that tempo had been maintained.

Last year, faced with the problem of increasing unemployment and a contracting industry, the Government began to take measures to meet the emergency. They introduced the Distribution of Industry (Industrial Finance) Act and created the D. A. T. A. C. areas. The Parliamentary Secretary wrote 60,000 letters to industrialists. It would be interesting if we could be told what was the response to that appeal. More recently, the decision was taken to build three advance factories, one each in England, Scotland and Wales, and I am grateful that one of the factories will be in my constituency. I hope that these factories will be built very rapidly, because they are experimental and the success of the experiment depends on how quickly they will be tenanted by industrialists. I hope that building may proceed so that other areas may benefit from similar factories very soon.

So far, the 1958 Act has not been successful in my area. In Anglesey we are no better off as a result of it. The most important application made under it was by a reputable applicant for £20,000 to build a factory which would have employed 150 men. It was turned down without any reason being given for the refusal. This has been bitterly resented in the area.

As my right hon. Friend the Member for Battersea, North said, one of !the solutions to the problem is to give these D. A. T. A. C. areas the full benefits of the 1945 Act. They need those benefits. Hon. Members have spoken of the advantages of Sections 3 and 5 of the 1945 Act. It stands to reason that the local authorities in these areas of high unemployment are poor local authorities and they are precisely the authorities which could benefit especially from the application of Section 3. Roads, water, power, light, housing and health services are the things they need and which would enable them more effectively to attract industry into their areas.

As the Minister for Welsh Affairs is on the Front Bench opposite, I should like to ask why we cannot have one Welsh Development Area instead of three. At the moment, we have the South Wales Development Area proper, under the 1945 Act, which also includes certain D. A. T. A. C. areas, we have the Wrexham area, which is scheduled under the 1945 Act but which is also entirely a D. A. T. A. C. area and we have the North-West Wales which is solely a D. A. T. A. C. area. The country is split up in this respect. Welsh people do not like being chopped up in this way. We are a united people, as the Minister ought to know, and we should like the country to be a united and integrated Development Area, receiving all the benefits of the 1945 Act.

So far, we feel that Government aid has been applied piecemeal and without much coherent thought. I do not think that we need be tied too rigidly to the 1945 Act, well though it has worked. Economic and industrial conditions have changed since 1945. This is all the more reason why we should consider new techniques. Perhaps new techniques could help industries on the periphery to sell their goods abroad. Certainly better and more effective planning of our industrial life and a more selective approach to industry as a whole are needed so as to find out which sections of industry are better suited to these areas on the periphery in Scotland and Wales.

Another question which the House must ask in consideration of this subject is whether the inducements which are now offered to industrialists are adequate. I cannot say that they are adequate in the new D. A. T. A. C. areas. Should there be something more by way of inducement? The words "inducement" and "persuasion" have been used in this debate—should there be something more? I was reading the report of the Barlow Commission yesterday and came across this very interesting paragraph giving the views of the Federation of British Industries on this point. The Federation of British Industries were opposed to compulsion on industrialists in the matter of location. At the same time they were prepared to accept a policy of ' discouragement' of settlement in certain areas and ' encouragement ' of settlement elsewhere. In the case of London, a new industry, unless it could make out a special claim, might be urged to go elsewhere. It is high time that the Government did a little less discouraging and a little more encouraging and a little more urging. There was an allocation room at the Board of Trade. Is that allocation room still working? What guidance does it give? It is no use building a factory unless one can get industrialists to tenant it. One feels that there is insufficient drive from the Board of Trade to induce industrialists to go to the areas where they are needed.

We are talking about the allocation of industry. What is the purpose and function of industry? I should have thought it was self-evident that its purpose and function is to serve the nation. What is the nation? Is the nation the leaders of industry or even the leaders of trade unionism or Ministers of the Crown or Members of Parliament? Certainly not. We know that the nation is the humblest member of the community who has no voice except our voices in this House, who has no future for himself or his children except the future that we can create for him. He is the nation. The Government will be judged by the way in which they serve that individual. Let the Government see to it that industry does its task properly and does its duty by the humblest member in the community.

9.28 p.m.

The Minister for Housing and Local Government and Minister for Welsh Affairs (Mr. Henry Brooke)

Three weeks ago we usurped St. George's Day for the annual debate on Welsh Affairs. Today we are discussing the situation throughout England, Wales and Scotland. I must say that I am very happy that Wales is having not only the first word but the last, too.

I am speaking as Minister for Welsh Affairs and also in my capacity as Minister of Housing and Local Government. I have contacts with the planning side on which I should like to speak in due course. Both the hon. Gentleman the Member for Anglesey (Mr. C. Hughes) and the hon. Gentleman the Member for Abertillery (The Rev. Ll. Williams) referred to the Barlow Royal Commission on the Distribution of the Industrial Population, and perhaps I might claim that my strongest right to take part in the debate is that as a private citizen I ventured to submit a memorandum of evidence to that Commission, which at any rate testifies to my own continuing interest in this subject over a period of many years. Indeed, ever since I knew the Rhondda and the South Wales coalfields, 30 years ago, I have been convinced that a vigorous policy to secure the distribution of industry such as will not allow some areas to be permanently dependent on one form of activity is an essential part of our national life and policy.

This is in a sense a private Members' day, and I want to respond by answering as many of the questions as I can that have been raised by hon. Members on both sides of the House. Sombre as the subject is, I think we are all grateful to the hon. Member for Abertillery for having used his good fortune in the Ballot to choose it, for this is a subject to which we are all agreed that Parliament should pay constant attention and, what is more important, for the reason given by the hon. Member for Anglesey at the end of his speech, that if we do not manage these things aright we may have boys and girls leaving school in certain parts of our land who are not able to get work and whose whole outlook on life will be soured by circumstances over which they have no control.

The House greatly appreciated the manner of the speech of the hon. Member for Abertillery. I did not agree with all he said, but he did a brave and difficult thing. He ventured to seek to hold the House silent by the emotion of his gesture and utterance. Few of us can do it. Yet every one of us was impressed by the sincerity of our colleague in his speech. At the same time, I think he would be the first to grant that we can solve the problem before us today not by emotion but only by work, and it is new ideas which could be carried into practical action for which I must say I have waited almost in vain today while listening to the speeches of the Opposition.

We had some rehash of the Jay report. I studied that because I look everywhere for sources of ideas. That report threw up among other things the practical suggestion that the Board of Trade should reopen its offices in Swansea and Dundee, suggesting that it was fantastic that these should have been closed two years ago. I looked up the figures and I found that in the eighteen months since those two offices were closed factory approvals in West South Wales and in Dundee have been such as to give rise to a substantially greater number of jobs in each case than in the previous eighteen months when the offices existed. [HON. MEMBERS: "Oh"] The right hon. Gentleman must have been scraping the barrel if he felt that this was the best suggestion he could bring up in this respect.

Mr. Jay

Does not the Minister realise that unemployment also went up in the same period in both those areas?

Mr. Brooke

Yes, and I realise that since those offices were closed between 9,000 and 10,000 new jobs have been brought into existence in West South Wales by the initiative of this Government.

The distribution of industry policy is, I believe, accepted on all sides of the House, indeed almost everywhere, though doubtfully by the Economist and by the Manchester Guardian and by some Liberal writers. In the 1930s it was difficult to influence firms to go where the nation needed them. That was because of the substantial average unemployment which existed everywhere and the absence, certainly in the earlier 1930s, of that general atmosphere of expansion which, it is part of my submission, is an essential element in a successful distribution of industry policy.

During the period after the war, it was easy to guide industry. There was a sellers' market. New peace-time factories were springing up. The big cities had suffered from bombing. People were looking for their opportunities. I do not wish to withhold credit from the Labour Government for what they did, but the task was a far more simple one than, for example, in the 'thirties. I would say that it is a most remarkable achievement. I know Wales, towards which I feel a special responsibility. Despite a certain trade recession in 1958 due to the action which the Government had found it essential to take to curb inflation, there was probably an attraction of new industries to Wales on a scale greater than in any previous year.

My hon. Friend the Parliamentary Secretary at the beginning of the debate described in detail the D. A. T. A. C. arrangements and the other provisions in our powers which we are at present exercising for the steering of industry. I do not propose to go over that in detail, but I simply say that, having passed the 1958 Act some nine months ago, we are now well equipped to steer industry where we need it in this period that is coming when the expansionist atmosphere is returning to trade.

Among other questions, hon. Members asked why it was not possible to anticipate possibilities of industrial decline. Intelligent anticipation was advocated. The truth is that one can anticipate the possibility of decline but one can never anticipate with certainty the time of that decline. Everybody knew that the old tinplate mines were bound to go out one day. No one could be certain when that would be, and the evidence of that is that as recently as three years ago Italian labour was being attracted into that area to provide employment.

When there is a situation of full employment, whatever may be the apprehensions for the future, it is literally impossible to attract other businessmen to come into such an area and put their factories there. No one can show how that time gap can be eliminated between the falling off of the old and the growth of the new.

The right hon. Gentleman the Member for Battersea, North (Mr. Jay) had ideas in his report on this subject. He said: The Government should also completely reverse its policy of cutting down civilian work by Royal Ordnance Factories even in areas of unemployment. Where private industry persistently fails to give employment, the Royal Ordnance Factories or other public enterprises should take its place. A Labour Government would see that this was done. The Labour Government would see that Royal Ordnance factories set to work producing large quantities of civilian goods for which there were no orders. Alternatively, in order to get such orders they would sell them at subsidised prices thereby greatly embarrassing those other industrialists whom the Government were bringing into the areas concerned. That apparently is what the Labour Government would do. To quote from the right hon. Gentleman's own report, I would say that this is not good practical administration, but muddle. This Government have approached all this in a more practical way.

Reference was made by hon. Members earlier to the closing of the torpedo factory at Greenock. But what has happened? That factory is being taken over by the Acme wringer firm, which in my judgment will employ at least as many as, if not more, than the old torpedo factory did and will certainly give a greater diversity of employment to that area. This is precisely what distribution of industry policy is designed to secure.

Dr. Dickson Mabon

Would the right hon. Gentleman not agree that if that factory had not been in existence, the Acme wringer firm would not have come to Greenock, which is a marvellous argument for having advance factories for these large firms?

Mr. Brooke

I will come to the subject of large factories in a moment. The fact remains that what has happened there has worked out in the long run to the benefit of Greenock and not otherwise, and it has been done through the influence of the present Government.

Miss Herbison

The right hon. Gentleman has dealt with this question of intelligent anticipation as it affects the tinplate industry in Wales. Would he say that the same case can be made out about the coal areas in Scotland? Would he say that that was the case, in spite of all the predictions in the reports of the coal industry of what was going to happen in that area? If so, only the Government have been unaware of the situation.

Mr. Brooke

I said that it was impossible to anticipate with certainty the timing of decline. I remember an hon. Member speaking in the Welsh debate the other day advocating public enterprises being set up in remote areas where it was difficult or impossible to attract private industrialists, in order that employment may come there, and almost in the same breath speaking of panic closures of pits by the National Coal Board—a nationally-owned concern. The Opposition cannot have it both ways.

The hon. Member for Abertillery spoke of the decision of the Government to build a great factory at Swansea, in a difficult area, for the Pressed Steel Company, as a godsend to that area. The fact that the Government are willing to build on that scale shows the intensity of the drive which the Government are prepared to put into solving this very serious human problem of unemployment in the areas of depression.

If it is suggested that the Government are sitting back and are allowing things to stagnate, how can one explain the fact that only in the last few months we have decided that the new strip mills should go ahead at Newport and Ravenscraig? It may be that some hon. Members would say that that should not have been done and that those mills should have been placed in Anglesey or elsewhere where there is 10 per cent. unemployment. But let us keep our economic good sense. We are not going to save this country's economy by forcing works to go into places which for those particular works are economically impossible.

All the way through we have got to maintain a balance in these matters. The fact that the new strip mill in Newport and the Colville strip mill at Ravenscraig will operate will have a salutary effect in stabilising the employment position in Wales and in Scotland generally.

One hon. Member spoke of the "absurd" concentrations of industry in big cities. They may be awkward, but they are not absurd. It is not absurd for the cotton industry to have been concentrated in Lancashire. There were good reasons for it. It is not absurd for coal mines to be situated on the coal. It is not absurd for consumer industries to be near consumers. It is not absurd for export industries to be near the ports. All of these have a good historical and economic explanation.

What there must be is safeguards against undue concentrations of industry in such a way that certain places are overloaded whereas others are unduly dependent on a single industry. That is the essence of the distribution of industry policy which has been followed by successive Governments. My hon. Friend the Parliamentary Secretary earlier in the debate described in detail the drastic policy which is being pursued by the Board of Trade as to the issue of industrial development certificates.

My predecessors and I in the Ministry of Housing and Local Government have been acting likewise with our planning powers. In 1955, my predecessor, now the Minister of Defence, approved the London Development Plan. In approving it, he withdrew no fewer than 380 acres in the county of London which the London County Council had desired to allocate for industrial and commercial purposes. He said, "No. That must be re-zoned for residential purposes," exactly in line with the policy which I believe commends itself to both sides of the House, and in contrast to the original proposals. The same happened in Middlesex.

Since 1938, about 1 million people have gone out of the County of London. The overloaded County of London has lost I million of its population and something like 200,000 factory jobs, which have moved out of London, if I may put it in that way. Around each of the new towns—this is closely linked with the general policy of the distribution of industry that we have been discussing—and around all great cities, green belt plans now restrain industrial development. However prosperous a city is, it is not permitted that industries shall sprawl out and out drawing more and more people into the nucleus.

Permission to use 592 acres for industry on the Warwickshire side of Birmingham was refused between 1950 and 1957. On the Staffordshire side, 367 acres were withheld from industrial use since 1955. That was with the Government's full support, for those areas had been approved in principle as green belts around the city. I am sure that my hon. Friend the Member for Bromsgrove (Mr. Dance) whose speech I was sorry I had to miss, will understand that I cannot say, or be taken to say, anything that would prejudge a decision I may have to make on a planning application around Birmingham on which a public inquiry will be held later in the year.

The hon. Lady the Member for Lanark-shire, North (Miss Herbison) asked about overspill. Certainly it is the Government's desire to make provision for wise overspill plans from the great cities. Many of these great cities—and the hon. Lady knows Glasgow much better than I do —cannot possibly rehouse in decent conditions all the people within their own bounds. There may be argument about how far it can go, but everyone must accept that there is a surplus that cannot be rehoused there. Smaller towns at a distance from the city have been wise who have recognised that they may be able to revitalise their own life by reaching agreement with one of the big cities.

The other day I was at Thetford, a small country town, whose population had been dwindling. It recognised that its best chance of stopping that diminution and outflow of its younger people was to bring from a great city both industry and workers. Judging by the atmosphere of the relations between London and Thetford, I greatly hope that it will be a success and that the newcomers and the old stagers will merge. I had to warn some of the Thetford people that there would be Londoners who would regard countrymen as hardly out of the woad stage, but Thetford people assured me that it was too cold to wear woad there, and that all would be well.

There are great psychological difficulties to be overcome before overspill schemes can be accepted, but where they have been accepted there is no doubt that both exporting area and accepting area benefit by it. I think the Opposition must decide what it means when it speaks of steering industry. Time and again in the course of this debate I have heard the words "The Government must plan." Do the Opposition mean that the Government should direct industry, or do they not? I believe that all of us, on both sides, have to recognise that direction of industry is out of the question, like direction of labour. Direction of labour is unthinkable. Direction of industry is, frankly, hopeless because it is no good putting an industry somewhere unless it is going to be successful. If we seek to direct industry somewhere there is no guarantee that it will be able to make ends meet. The most powerful magnet of all is a really modern factory. The right hon. Member for Battersea North asked about the building of new factories. There are twenty-eight empty Government factories now, so we should be cautious about going on building everywhere. Incidentally, I can tell him that the new factory on Merseyside will be at Speke.

Mr. Ainsley

Will the right hon. Gentleman agree that the economic factor has been the direction of 10,000 people from the west of the County of Durham?

Mr. Brooke

I am not quite sure that I follow the argument of the hon. Member, but I sincerely trust he is not advocating direction of labour. [HON. MEMBERS: "The right hon. Gentleman is."] The Government are proposing as a pioneer experiment to build three advance factories before there is a tenant for them. We must see if tenants can be obtained. I greatly hope they will be, especially for the sake of the hon. Member for Anglesey, whose constituency, as I have told him before, I regard as the most difficult unemployment problem in the whole Principality.

The hon. Member for Abertillery asked for a trading estate in North Mon- mouthshire. I doubt if we should start new trading estates while there are eight or ten Government factories empty m Wales. I think what will help the area he has in mind far more is improvement in the road communications with the Mid-lands which the Government intend to bring about. This vast programme of road improvement on which the Government are embarked will reduce remoteness. It is the relative remoteness which has been the common factor in all these areas of local unemployment. At one time these difficult areas were relatively backward in social services and health services. I think that is how Section 3 of the 1945 Act came to be written in. The position there has vastly changed since the old Special Area days. The hon. Member for Aber-finery will recognise that in the changed outlook, the changed scene in the mining valleys, the transformation of the Rhondda, for instance, since the old days of bad unemployment. Section 3 is designed to enable grants to be given for the improvement of basic services because industry might not otherwise come to those areas.

The truth is that very little has been done under Section 3 at any time, except on water and sewerage, and that is my answer to the point made by the noble Lady the Member for Carmarthen (Lady Megan Lloyd George). It is quite true that in the early years, 1946 and 1947, a little was done on transport and power matters, but there are grants under other legislation for road improvements and the like. Generally it has been used for water and sewerage, grants for which, except in rural areas, there is no other statutory provision.

Mr. Jay

Will the Minister at least answer the main question I asked him about the proportion of factory approvals this year compared with last year for London and the Development Areas?

Mr. Brooke

I shall endeavour to do so, but I was also asked about Section 3 of the 1945 Act. There is now, after a number of years of general prosperity, nothing like the same need for the improvement of these basic services—they have advanced so much. Nevertheless, we sent out a circular on 12th May and a number of applications and inquiries have been received in response to that circular in respect of Section 3. Those applications are being investigated. A few seem certainly eligible for consideration, but I should be misleading the House if I were to suggest that there was a great deal to be done there, simply because of the great advance since the need for basic service grants was first perceived many years ago.

Extra work of a public character, nevertheless, has been authorised on a very substantial scale to cover this time gap between the decline of the old industries and the attraction of the new industries which are coming to many places. The other day I gave the House a figure of £1¾ million of extra work which had been authorised in Wales alone. That sort of work by public authorities we must surely all agree, however, is a palliative and not a complete solution.

The trade outlook is brightening, and as the outlook brightens we must seek to influence expansion into those areas which are in need of work. My hon. Friend the Member for Aberdeen, South (Lady Tweedsmuir) compared it with the flow of oil. We must see that the oil flows where it is needed to lubricate. We have powerful instruments for this purpose, as my hon. Friend the Parliamentary Secretary explained, and as trade becomes more and more expansionist they will grow and become more effective.

I did not quite understand all the figures given by the right hon. Member for Battersea, North. I did not know where he obtained them. For the first three months of 1959 the factory area approved for London was 2½ million sq. ft. and for Scotland and Wales it was 5J million sq. ft. Bearing in mind

the relative populations of those areas, it will be seen that the Development Areas are getting their full share.

The right hon. Gentleman wants the Development Areas extended. I do not know whether in his youth, before he was as tall as he is now, he ever stood on a soap box to see over other people's heads in a crowd. That is all right if one does it alone, but if everybody gets on to a soap box, nobody is any better off and there is great insecurity of tenure. It is no use turning the whole country into a Development Area and thinking that the areas of unemployment will gain.

In the last few weeks my right hon. Friend's Budget has been designed to promote the expansion of trade and industry. I understand that the Opposition would have diverted £200 million out of that Budget to other purposes. By the financial and economic policy which we are following we intend to seek and to find solutions of this very human problem which we have discussed today.

I assure the House that the Government will keep an open mind to any ways of improving their instruments for steering industry into the areas where it is needed. The trade winds are freshening, thanks to the Government's policy. Unemployment fell substantially in March and again in April. If all the business indicators which are available to me are any guide, I have little doubt that when the May figures are available they will show that that process is continuing.

Question put, That the words proposed to be left out stand part of the Question:—

The House divided: Ayes 179, Noes 144.

Division No. 115.]	AYES	[10.0 p.m.
Aitken, W. T.	Browne, J. Nixon (Cralgton)	du Cann, E. D. L.
Amory, Rt. Hn. Heathcoat (Tiverton)	Bryan, P.	Emmet, Hon. Mrs. Evelyn
Armstrong, C. W.	Campbell, Sir David	Errington, Sir Eric
Ashton, H.	Carr, Robert	Farey-Jones, F. W.
Baldwin, Sir Archer	Channon, H. P. G.	Finlay, Graeme
Balniel, Lord	Chichester-Clark, R.	Fisher, Nigel
Barber, Anthony	Cole, Norman	Fletcher-Cooke, C.
Barlow, Sir John	Conant, Maj. Sir Roger	Freeth, Denzil
Barter, John	Cooper, A. E.	Gammans, Lady
Batsford, Brian	Cordeaux, Lt.-Col. J. K.	Gibson-Watt, D.
Bell, Philip (Bolton, E.)	Corfield, F. V.	Glyn, Col. Richard H.
Bell, Ronald (Bucks, S.)	Courtney, Cdr. Anthony	Godber, J. B.
Bevins, J. R. (Toxteth)	Craddock, Beresford (Spelthorne)	Gough, C. F. H.
Bingham, R. M.	Crosthwaite-Eyre, Col. O. E.	Graham, Sir Fergus
Bishop, F. P.	Crowder, Sir John (Finchley)	Grant-Ferris, Wg Cdr. R. (Nantwich)
Body, R. F.	Currie, G. B. H.	Green, A.
Bossom, Sir Alfred	Dance, J. C. G.	Gresham Cooke, R.
Braine, B. R.	D'Avigdor-Goldsmid, Sir Henry	Grlmston, Sir Robert (Westbury)
Brewis, John	de Ferranti, Basll	Grosvenor, Lt.-Col. R. G.
Bromley-Davenport, Lt. Col. W. H.	Dodds-Parker, A. D.	Gurden, Harold
Brooke, Rt. Hon. Henry	Doughty, C. J. A.	Hall, John (Wycombe)
Harris, Reader (Heston)	Lucas, Sir Jocelyn (Portsmouth, S.)	Russell, R. S.
Harrison, Col. J. H. (Eye)	Lucas-Tooth, Sir Hugh	Sharples, R. C.
Harvey, Sir Arthur Vere (Maccles'fd)	McAdden, S. J.	Shepherd, William
Harvey, John (Walthamstow, E.)	Macdonald, Sir Peter	Smithers, Peter (Winchester)
Harvie-Watt, Sir George	Mackeson, Brig. Sir Harry	Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)
Heald, Rt. Hon. Sir Lionel	McLaughlin, Mrs. P.	Steward, Harold (Stockport, S.)
Heath, Rt. Hon. E. R. G.	Maddan, Martin	Steward, Sir William (Woolwich, W.)
Henderson-Stewart, Sir James	Maitland, Cdr. J. F. W. (Horncastle)	Storey, S.
Hicks-Beach, Maj. W. W.	Maitland, Hon. Patrick (Lanark)	Stuart, Rt. Hon. James (Moray)
Hill, John (S. Norfolk)	Marshall, Douglas	Studholme, Sir Henry
Hirst, Geoffrey	Mathew, R.	Teeling, W.
Holland-Martin, C. J.	Mawby, R. L.	Temple, John M.
Hornby, R. P.	Maydon, Lt.-Comdr. S. L. C.	Thomas, Leslie (Canterbury)
Horobin, Sir Ian	Medlicott, Sir Frank	Thompson, R. (Croydon, S.)
Horsbrugh, Rt. Hon. Dame Florence	Mott-Radclytfe, Sir Charles	Thornton-Kemsley, Sir Colin
Howard, John (Test)	Neave, Airey	Turton, Rt. Hon. R. H.
Hughes Hallett, Vice-Admiral J.	Nicolson, N. (B'n'm'th, E. & Chr'ch)	Vane, W. M. F.
Hughes-Young, M. H. C.	Noble, Michael (Argyll)	Vaughan-Morgan, J. K.
Hutchison, Sir James (Scotstoun)	Nugent, Richard	Vickers, Miss Joan
Hyde, Montgomery	Oakshott, H. D.	Vosper, Rt. Hon. D. F.
Hylton-Foster, Rt. Hon. Sir Harry	Ormsby-Gore, Rt. Hon. W. D.	Wakefield, Edward (Derbyshire, W.)
Iremonger, T. L.	Page, R. G.	Wakefield, Sir Wavell; (St. M'lebone)
Irvine, Bryant Godman (Rye)	Pannell, N. A. (Kirkdale)	Walker-Smith, Rt. Hon. Derek
Jenkins, Robert (Dulwich)	Partridge, E.	Wall, Patrick
Johnson, Dr. Donald (Carlisle)	Peel, W. J.	Ward, Dame Irene (Tynemouth)
Johnson, Eric (Blackley)	Pickthorn, Sir Kenneth	Watkinson, Rt. Hon. Harold
Keegan, D.	Pilkington, Capt. R. A.	Webbe, Sir H.
Kerr, Sir Hamilton	Pitman, I. J.	Webster, David
Kershaw, J. A.	Pitt, Miss E. M.	Williams, Paul (Sunderland, S.)
Kirk, P. M.	Pott, H. P.	Williams, R. Dudley (Exeter)
Langford-Holt, J. A.	Powell, J. Enoch	Wills, Sir Gerald (Bridgwater)
Leavey, J. A.	Price, David (Eastlelgh)	Wilson, Geoffrey (Truro)
Leburn, W. G.	Price, Henry (Lewisham, W.)	Wolrige-Gordon, Patrick
Legge-Bourke, Mai. E. A. H.	Prior-Palmer, Brig. 0. L.	Wood, Hon. R.
Legh, Hon. Peter (Petersfield)	Rawlinson, Peter	Woollam, John Victor
Lindsay, Hon. James (Devon, N.)	Redmayne, M.	Yates, William (The Wrekin)
Linstead, Sir H. N.	Ridsdale, J. E.	TELLERS FOR THE AYES:
Longden, Gilbert	Rodgers, John (Sevenoaks)	Mr. Brooman-Wbite and
Loveys, Walter H.	Roper, Sir Harold	Mr. Wintelaw.
Low, Rt. Hon. Sir Toby
NOES
Alnsley, J. W.	Grenfell, Rt. Hon. D. R.	Mitchison, G. R.
Allen, Arthur (Bosworth)	Grey, C. F.	Moody, A. S.
Baird, J.	Griffiths, Rt. Hon. James (Llanelly)	Morris, Percy (Swansea, W.)
Benn, Hn. Wedgwood (Bristol, S.E.)	Hale, Leslie	Moyle, A.
Blackburn, F.	Hall, Rt. Hn. Glenvil (Coine Valley)	Noel-Baker, Francis (Swindon)
Blenkinsop, A.	Hamilton, W. W.	Noel-Baker, Rt. Hon. P. (Derby, S.)
Blyton, W. R.	Hannan, W.	Oram, A. E.
Boardman, H.	Hastings, S.	Owen, W. J.
Bonham Carter, Mark	Hayman, F. H.	Padley, W. E.
Bottomley, Rt. Hon. A. G.	Healey, Denis	Paget, R. T.
Bowden, H. W. (Leicester, S.W.)	Henderson, Rt. Hn. A. (Rwly Regis)	Pannell, Charles (Leeds, W.)
Bowles, F. C,	Herbison, Miss M.	Parkin, B. T.
Braddock, Mrs. Elizabeth	Hewitson, Capt. M.	Peart, T. E.
Brockway, A. F.	Hylton, A. V.	Pentland, N.
Broughton, Dr. A. D. D.	Holman, P.	Plummer, Sir Leslie
Brown, Rt. Hon. George (Belper)	Houghton, Douglas	Popplewell, E.
Burton, Miss F. E.	Hughes, Cledwyn (Anglesey)	Prentice, R. E.
Butler, Herbert (Hackney, C.)	Hughes, Emrys (S. Ayrshire)	Price, J. T. (Westhoughton)
Butler, Mrs. Joyce (Wood Green)	Hughes, Hector (Aberdeen, N.)	Price, Philips (Gloucestershire, W.)
Champion, A. J.	Hunter, A. E.	Probert, A. R.
Chetwynd, G. R.	Hynd, H. (Accrington))	Pursey, Cmdr. H.
Cliffe, Michael	Hynd, J. B. (Attercliffe)	Rankin, John
Collick, P. H. (Birkenhead)	Janner, B.	Redhead, E. C.
Corbet, Mrs. Freda	Jay, Rt. Hon. D. P. T.	Reid, William
Craddock, George (Bradford, S.)	Jeger, George (Goole)	Reynolds, G. W.
Cronin, J. D.	Jones, David (The Hartlepools)	Roberts, Goronwy (Caernarvon)
Darling, George (Hillsborough)	Jones, J. Idwal (Wrexham)	Robinson, Kenneth (St. Pancras, N.)
Davies, Harold (Leek)	Kenyon, C.	Rogers, George (Kensington, N.)
Diamond John	Key, Rt. Hon. C. W.	Ross, William
Donnelly, D. L.	King, Dr. H. M.	Short, E. W.
Ede, Rt. Hon. J. C.	Lawson, G. M.	Silverman, Julius (Aston)
Edelman, M.	Lipton, Marcus	Silverman, Sydney (Nelson)
Edwards, W. J. (Stepney)	Mabon, Dr. J. Dickson	Skeffington, A. M.
Evans, Albert (Islington, S.W.)	McAlister, Mrs. Mary	Slater, J. (Sedgefield)
Fernyhough, E.	McCann, J.	Snow, J. W.
Finch, H. J. (Bedwellty)	MacColl, J. E.	Sorensen, R. W.
Fletcher, Eric	McInnes, J.	Soskice, Rt. Hon. Sir Frank
Fraser, Thomas (Hamilton)	McLeavy, Frank	Sparks, J. A.
Galtskell, Rt. Hon. H. T. N.	MacPherson, Malcolm (Stirling)	Spriggs, Leslie
George, Lady Megan Lloyd(Ca'then)	Mahon, Simon	Stonehouse, John
Gibson, C. W.	Marquand, Rt. Hon. H. A.	Stones, W. (Consett)
Gordon Walker, Rt. Hon. P. C.	Mellish, R. J.	Strauss, Rt. Hon. George (Vauxhall)

Stross, Dr. Barnett(Stoke-on-Trent, C.)	Watkins, T. E.	Williams, Rev. Llywelyn (A b'tillery)
Swingler, S. T.	Weitzman, D.	Winterbottom, Richard
Taylor, John (West Lothian)	Wells, Percy (Faversham)	Woof, R. E.
Thomas, George (Cardiff)	Wells, William (Walsall, N.)	Zilliacus, K.
Thomson, George (Dundee, E.)	White, Mrs. Eirene (E. Flint)
Viant, S. P.	Wilkins, W. A.	TELLERS FOR THE NOES:
Warbey, W. N.	Willey, Frederick	Mr. Pearson and Mr. Simmons.

Main Question again proposed.

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

Committee Tomorrow.