§ Order for Second Reading read.
§ 3.30 p.m.
§ The President of the Board of Trade (Mr. Reginald Maudling)
I beg to move, That the Bill be now read a Second time.
The Bill is regarded on both sides of the House as being of considerable importance. Indeed, the Opposition have suggested that it is important enough for its Committee stage to be taken on the Floor of the House. My right hon. Friend the Leader of the House has considered this and has asked me to say that, in view of those representations and the importance of the Bill, the Government propose to keep the Bill on the Floor and not to send it to a Standing Committee upstairs.
My right hon. Friend has asked me to add that he does not expect the Opposition to abate one whit the fury and ferocity of their comments, but is sure that they will co-operate in the businesslike handling of the Bill in Committee.
The purpose of the Bill is best expressed in the first lines of the Long Title. It is a BillTo make provision to promote employment in localities in England, Scotland and Wales where high and persistent unemployment exists or is threatened …It is one of a long series of Measures dealing with this problem, the first being the Special Areas (Development and Improvement) Act, 1934, which was passed by a House of Commons with a Conservative majority, a series to which both parties have since made their contribution.
The broad purpose of the Bill is to bring up to date the legislation on this subject in the light of experience and up-to-date conditions and requirements. I first pose the question of what we are trying to do with this series of measures now enacted over a long period. It is possible in theory to argue that there is some ideal pattern of industrial distribution among the regions of the country and within those regions which the Government should determine and then seek to impose upon the industrial growth of the country. I believe that 32 while that concept may in theory be logical, it is not in practice workable.
All the time we must remember to be concerned with the basic strength of the economy as a whole. Anything which distorts that strength, anything which adds additional burdens, must weaken our competitive position, and if we weaken our competitive position as a country we endanger our ability not only to maintain full employment generally, but to deal with the special problems of individual areas.
We believe that we should start from the assumption that the economic and industrial expansion of the country should proceed freely in response to growing and changing consumer demand and that it should proceed on the principle of the most effective use of our national resources, especially in competitive conditions.[Interruption.] I am delighted to know that the right hon. Member for Ebbw Vale (Mr. Bevan) is with me on this.
§ Mr. Maudling
In that case, the right hon. Gentleman should make his comments more audible or more intelligible.
§ Mr. Maudling
I think that the existing traffic problem may be due to some extent to the level of production in the motor industry under a Conservative Government.
This principle of the most efficient use of our resources must clearly be mitigated in some cases by Government action to deal with certain social consequences which the nation does not regard as acceptable. Broadly speaking, there are two such social consequences. First, there is the tendency of industry in freely competitive conditions to concentrate excessively in certain areas, with all the consequences to which the right hon. Gentleman just referred. Secondly, there is the connected consequence of high levels of unemployment in particular areas in other parts of the country.
33 No doubt, in pure economic doctrine it is the right thing for the workers to move to their work, and I have seen that rather hinted at in thoughtful articles in the newspapers recently. However, in these matters we cannot be guided only by pure economic doctrine. That is why we have this legislation. Although, no doubt, to the economist a house is only a house, we know that a house is more than a house—it is a home. A town is more than a collection of houses—it is a collection of homes, it is a community. Social capital and human capital are not adaptable and changeable to the extent and at the pace which economists might sometimes assume.
Our main purpose in these matters is to mitigate, for social and human reasons, some of the industrial consequences which might normally flow from an entirely free expansion of the trade and industry of the country in competitive conditions in an endeavour to meet changing consumer demand.
What are the assumptions upon which we must work? We must first assume that one cannot direct a particular industry to any set place.[HON. MEMBERS: "Why not?"] I want to ask the party opposite about this. It seems to us that one cannot tell a stocking manufacturer to set up a factory on Merseyside, or an electronics firm to go to Lanarkshire, or West South Wales. No Government have yet had the power to direct that and I do not believe that the party opposite has ever claimed that it would take the powers to issue such directions.
For a proper and objective study of the possibilities of this problem, it is important that the party opposite should say whether it would propose to take powers to order individual private or public concerns to set up factories in particular areas. That is certainly not possible under any legislation which hon. Gentlement opposite have passed, nor would it be possible under any legislation which they have foreshadowed in their official publications.
We must, therefore, start from that basic assumption. That leads us to the second proposal—that if one cannot order individual firms to special areas one can at least put a general prohibition on firms going to areas already congested and also provide inducements generally 34 available to firms to go to areas of special employment difficulties. That is the basis of the legislation which has been enacted in the past and which we are now proposing.
The basic principle, I think, is the industrial development certificate, by which we prevent firms setting up in areas already over-congested, although in their view—and they are certainly best equipped to judge—it may be in those congested areas that they would prefer to establish their factories and on all normal commercial grounds would wish to do so and be wise in doing so. The industrial development certificate prevents the growth of congestion in areas already congested. By preventing people going to those areas, it gives them a shove in the direction in which we want to see them go, namely, to areas where there is substantial local unemployment.
In itself, that is not enough, because there is always a strong possibility that firms prevented from setting up in areas of their own choice will decide not to expand at all, but to do nothing. We must have what we rightly call inducements, to persuade people who have been prevented from setting up their businesses in the areas of their own choice to set up their factories in other areas where there is potential local unemployment. It is right to say that these inducements, broadly speaking, are based on the principle of giving to the undertaking concerned due inducement for having to establish its works in an area where the cost of production is higher than the cost of production in the area which it would normally choose on commercial principles. That is the basis of the policy of inducement.
There has been a great change in the general situation since the Special Areas Act was passed, in 1934. The original concept was one of large areas of the country where unemployment was endemic, deep rooted, and semipermanent. As the House knows, the rate of unemployment was slowly falling from the 1932 peak of 2.8 million. The general rate for the whole of Great Britain was 19 per cent., and in the special areas the rate was 38 per cent. Again, as the House will recall much of this special situation arose from the acute depression in the heavy industries, coal, iron and steel, and shipbuilding, 35 and certain sections of engineering which were feeling the effects of the international trade depression of those days.
There has been a dramatic change. The general level of employment in the country which was then 19 per cent. is now less than 2 per cent. In the Development Areas the level is certainly still higher than the level for the country as a whole, but compared with 38 per cent. then it is 4 per cent. or 5 per cent. now. Some sections of the old Development Areas are now fully employed, and we are glad to see that. It is worth recording that the Board of Trade has played a considerable part in that development. There are now no fewer than 190,000 people employed in factories on Board of Trade estates.
The problem has changed very much. First, because the general position is much better, and, secondly, because in some parts of the old Development Areas the special problems have by and large been solved. On the other hand, we are facing a greater rate of economic and technical change. New districts are involved now in these problems, often quite small and isolated districts. The changes in competition, in design, and in consumer demands are having very rapid effects. There is also a discernible tendency for light industry to move away from its source of raw material towards markets for its finished products. All these things mean that the old conception, although true at the time, is now no longer appropriate to present day conditions. That is the first reason for the introduction of the Bill.
The present system is, in one way, very confusing. There is overlapping between the Development Areas and the Development Area Treasury Advisory Committee areas. I think that overlapping is a natural result of the changing circumstances to which I have already referred, but we now have the position where a town can be both a Development Area and a D.A.T.A.C. area; a Development Area but not a D.A.T.A.C. area; and a D.A.T.A.C. area but not a Development Area. The House will agree that that is not a satisfactory situation. The first effect of the Bill is to ensure that all the powers of 36 assistance with local employment problems will be available for all the localities, without distinction, that fall within the ambit of the Bill.
The new procedure—about which I shall say more later—of a list maintained by the Board of Trade recognises the need for uniformity, the great need for flexibility, and the ability to change to meet changing circumstances. A few years ago some of my hon. Friends prepared a pamphlet entitled "Change is our Ally". That is an important rule for us to follow. The industrial picture of the world is changing very fast with new countries industrialising themselves. This is where we are now facing direct and acute competition. At the same time as we are facing new competition from this process we are facing new opportunities. We must grasp the fact of change and make the maximum use of it. If we regard the change as our enemy, if we think it is our business to shore up industries for which the demand no longer exists, we shall run the country's economy into very serious difficulties. We must recognise the need for change and grasp the opportunities for change and not flinch from them. This also means that in our legislation on this subject we must be prepared to deal rapidly, if possible in advance, with the consequences of the changes to which I have been referring.
There is a very important word in Clause 1 of the Bill. It is the word "imminent". Under the Bill the Government will have power to deal with the situation not only where a high and persistent rate of unemployment exists, but also where one is imminent. The conception behind that is this; it will be impossible to act wherever there is a distant or vague threat of unemployment, or competition with a particular industry. We regard the word "imminent" as meaning that there is a discernible fact, for example, the closure of a pit, which is bound to mean the removal of a number of opportunities for employment. Where there is a factor of that kind which can be ascertained, one can say that there is an imminent threat of unemployment. If it is likely to be persistent, under the Bill we shall have power to act in anticipation. I am confident that the House will agree that we should possess that power.
37 There are other important provisions in Clause 1. The first is that in carrying out its policy the Board of Trade should have regard to the amount of employment likely to be provided by the money it spends. One can waste as much money on something that is good in principle as on something that is bad in principle if the money is not spent wisely and carefully. In considering any project we must calculate the amount of employment likely to arise from any given expenditure of the taxpayer's money. Secondly, we must have regard to the effect of spending money in one area on other areas of special employment difficulties. There is no point in spending money merely to transfer a problem from one area to another.
Finally, I call attention to the fact that the powers we are seeking extend to what we can call "travel to work areas", and to overspill areas, which, I think, in present industrial development conditions is right. Those are the opening provisions of the Bill.
I now turn to the main powers of inducement which the Board of Trade will possess under the Bill, and which are set out in Clauses 2 to 7.
§ Mr. George Chetwynd (Stockton-on-Tees)
Does the right hon. Gentleman intend to define what he means by a high rate of unemployment? The whole thing turns on that definition.
§ Mr. Maudling
I was proposing to deal with that at a later stage. I agree that the question of administration is important.
Perhaps I might, first, deal with the actual powers we are seeking under the Bill. Clause 2 gives power to acquire land and build factories. The practice of letting these factories will continue, not at a rent based on cost, but at a rent based on current market value in the locality. Broadly speaking, that has been the policy in these matters for many years.
Clause 2 extends the existing powers. They will not in future be confined to Development Areas, but will be extended over all the areas which fall within Clause 1 of the Bill. By agreement, the Board of Trade will also have power to build on land not owned by the Government, and we shall have power to build for non-industrial undertakings.
38 That is an important power, because there may be many occasions when it will be as useful to provide for employment in a commercial undertaking as it is to provide employment in an industrial undertaking.
§ Miss Margaret Herbison (Lanarkshire, North)
Can the right hon. Gentleman tell us what the Government have in mind according to paragraph (a)? It refers to the Board having powerto acquire land by agreement or, if so authorised, compulsorily".What have the Government in mind on the question of compulsion?
§ Mr. Maudling
That is a continuation of the existing powers. We intend to continue the existing policy, under which compulsory powers have been used, on very few occasions. Fortunately, they have not usually been necessary. There is no change in policy in regard to these powers.
Clause 3 introduces a new grant, called the building grant. Clause 2 continued existing powers whereby the Board of Trade could build and let factories, but we thought that it would also be useful for the Board to have powers to help industrialists who wanted to build their own factories. There must be many occasions where it is more convenient and more efficient for an industrialist to own his factory rather than to rent it from the Board of Trade. The Clause provides for a grant of 85 per cent. of the difference between the notional cost of constructing the factory in the unemployment area and the current market value of the factory when so constructed.
That is rather similar to the concept of imposing a rent based upon market value rather than upon the cost of construction of a Board of Trade factory. It means that the principle upon which we have been working in the past will be applied not only to the renting of Government factories, but also to assisting people to build their own. We feel that in many cases this will provide a greater incentive to an industrialist to establish himself in one of these areas than exists under current legislation.
The figure of 85 per cent. rather than 100 per cent. has been fixed to take account principally of the intangible benefits which will certainly flow from 39 owning rather than renting a factory. As the House will see, the calculation is based not upon the actual cost of the factory when constructed but upon the cost of a standard factory in the area. There are two reasons for that. First, it does not seem reasonable to provide Government money to assist in the construction of any frills or special amenities which are not strictly necessary for the factory. Secondly, the industrialist must know in advance the size of the grant he will get. We shall be able to inform him what our calculation is, based upon the cost of construction of a standard factory in the area, and, upon that basis, we shall be able to inform him in advance what grant will be available.
§ Mr. J. T. Price (Westhoughton)
Who will decide these intangible amounts? Is it to be the public valuer? Will he be brought in to make assessments of values? Great dissatisfaction is already felt about some activities of public valuers in valuing property of this kind.
§ Mr. Maudling
I can see no alternative to this being done by district valuers. If the hon. Member has a point to make about specific examples I have no doubt that we shall be happy to consider it.
There are two checks or safeguards upon the use of this power. First, the Board of Trade can act only after consultation with the advisory committee—the same advisory committee as is referred to in the subsequent Clause. Secondly, we shall have to impose conditions to provide for the repayment of grant in certain circumstances, to avoid the possibilities of abuse which clearly might arise.
Clause 4 extends the existing D.A.T.A.C. powers in respect of loans and grants to all those unemployment areas which are listed in Clause 1. It retains the condition that moneys can be made available only to assist with a project that is likely in the long run to stand on its own feet. That is an essential safeguard. Secondly, it retains the further safeguard that the Board of Trade can act only upon the recommendation of the advisory committee. I suggest that both are very wise safeguards.
At the same time, the Clause makes one big change, by abolishing the previous 40 condition that the Government could act only as a lender of last resort. We think that that was too restrictive a condition. On the other hand, the Government clearly do not wish to enter into business in competition with the normal sources of finance. In these matters a great deal will rest upon the judgment and wisdom of the advisory committee. In general, the purpose of the Clause is to operate in the field of working capital and of plant and equipment in rather the same way as the previous Clauses will operate in the field of factory building.
In other words, the principle must be to have regard to the additional cost which is imposed upon the industrialist by persuading him to go to one area rather than another, and to help him in the most appropriate way to meet that additional cost.
§ Mr. Sydney Silverman (Nelson and Colne)
The Clause, in this respect repeating earlier legislation, refers to grants and loans. The right hon. Gentleman will probably be aware that under previous legislation grants were very rarely made. In practice, only the power to make loans was exercised. Is that practice to be changed?
Secondly, up to now D.A.T.A.C. has taken an extraordinarily long time to deal with applications. Can the right hon. Gentleman tell us of any contemplated procedure which will speed up D.A.T.A.C. dealing with applications made?
§ Mr. Maudling
I will deal later with the question of administration. I agree that grants have been rare, and that, normally, loans have been made. On the whole, I would expect that to continue. I think that it would be much more difficult to justify a grant than a loan. But one of the most important powers is that of waiving interest, particularly in the initial stages of the setting up of a new enterprise. Whether one describes that as a grant or a loan I am not sure, but it would seem to be equivalent to a grant if the power to waive interest is exercised.
The powers would include both grants and loans, and I do not expect any great departure from the existing policy in the matter. As the hon. Member will have observed, the advisory committee will 41 have to act in these matters in accordance with the general directions given it by the Board of Trade and the Treasury.
§ Commander J. W. Maitland (Horn-castle)
Is it intended that the general directions which will be given to the committee will be the same as they have been in the past, or is it proposed to issue new general directions?
§ Mr. Maudling
We propose to consider the issue of new general directions, but I do not think that they will vary greatly from those of the past. I cannot undertake that they will be exactly the same as they are at the moment. We want to be quite sure what is right before we issue the directions.
Mr. Percy Collide (Birkenhead)
Hon. Members on this side of the House are most interested in this. Is there any great advantage to be derived from the new Bill by existing Development Areas?
§ Mr. Maudling
I have already given one example, which is the provision of building grants. As I go along I am trying to explain the powers provided under each Clause, and in what way they extend the present powers. I hope that the hon. Gentleman will allow me to continue my speech. I have given way on several occasions already. We have two days for the Second Reading debate, and there will be plenty of time to examine the details in Committee. I agree that the Bill will have to be examined in great detail. I hope that I may be allowed to continue to set out the main provisions of the Bill.
Clause 5 deals with derelict land. Its purpose is to enable the Government to assist local authorities to deal with land which is derelict, neglected or unsightly, and which can either be used for the purposes of providing employment or can be cleared up to provide greater opportunities for industry to come into the area.
Two quite separate factors are involved. There is the actual use of the land and the clearing up of eyesores to make a district generally more attractive to industry. The powers given are, first, to the Board of Trade to acquire land and carry out works on that land, and, secondly, to my right hon. Friends the Minister of Housing and Local Government and the Secretary of State for Scotland to make grants to local authorities 42 for the same purpose. That purpose is not to improve the general amenities, as such, but to improve amenities when, by doing so, we can be satisfied that we shall attract additional employment to the area. I think that there is a clear distinction which must be maintained. Nevertheless, the scope for making localities more attractive to industries by clearing up eyesores must be very considerable.
These powers of acquisition and building may be used only for the purposes of the Act. That, of course, is important. We are not granting any new powers to local authorities as such. Under this Clause the powers are granted to my right hon. Friends to make grants to help them in their work. The great extension in this Clause is that hitherto the power to deal with derelict land has been confined to land which is legally derelict; in other words, land which is ownerless or abandoned. That is a very practical limitation on the use of existing powers in this matter. As the House will see, these have been considerably extended by including any land which is neglected or unsightly.
The grants to local authorities are extended, also, in that they can now cover the cost of land as well as the cost of the carrying out of works on the land. Previously, there was no power to assist to finance the acquisition of the land for the purpose. Clause 5 considerably extends the facilities, and what can be done to clear up these unsightly places, and so help to provide more employment.
Clause 6 is mainly a matter for my right hon. Friend the Minister of Labour, who will be speaking later in the debate. It repeats, with some extension, Section 4 of the 1950 Act, providing him with power to make grants for the removal, resettlement and travel of key workers.
Clause 7 re-enacts, with, at any rate, some extension of the definitions, Section 3 of the Act of 1945 and provides authority for Ministers to make grants for the improvement of basic services. This is a very important Clause. Perhaps I should draw a distinction between national services and local facilities. It would be quite wrong to suppose that one could use this Clause, for example, to redesign the transport system of the country. Clearly, transport facilities should be of very great importance to 43 many areas now classified as Development Areas. In planning the general development of the transport system, my right hon. Friends will keep fully in mind the needs of these particular areas. But the specific powers in the Bill are intended to refer to such things as local access roads, the strengthening of bridges for heavy loads or possibly the provision of bridges; in other words, the specific provision locally of transport facilities, or the provision of an electricity supply or other facilities which would be of great use in particular cases.
There is one power which does not appear in the Bill, because it exists already in other legislation. That is the power of my right hon. Friend the Minister of Housing and Local Government to assist in providing houses to meet the needs of industry. That, also, is a very important power in dealing with these problems of local unemployment.
These are the main powers of inducement which it will be open to the Government to exercise under the Bill and, as I have been trying to explain in detail, they are based on previous experience but, at the same time, represent an extension and, we believe, an improvement of existing powers.
I now come to Part II, the industrial development certificates. Here, the provisions are mainly to tighten up existing legislation. We do not propose any major change in the system of industrial development certificates, either any major change in the powers of the Government or a major change in the policy, which we have now been operating for some time, of looking very closely indeed at any application to establish undertakings in areas which are already congested. The only changes which I think should be noted are two designed to close loopholes which exist at present in the I.D.C. system.
First, I understand that there is at present no control over change of user, and, therefore, at is possible, for example, to build a warehouse, and later to change it to a factory, without having to get an I.D.C. Secondly, since I.D.Cs. do not apply below an area of 5,000 sq. ft., it is possible for ingenious people to build large factories comprising a large number of buildings none of which is individually of a greater area 44 than 5,000 sq. ft. Both of these loop holes—
§ Mr. Maudling
If it had not happened, we should not be introducing this legislation.
These are two examples of how the purpose of Parliament in this matter can be frustrated and we are closing those loopholes.
Finally, on the question of administration—
§ Mr. Bevan
There is one other important category. I seem to remember that we had a very great deal of difficulty in operating some of these powers formerly because of the applications for substantial extensions of existing premises; not only for the establishment of a factory, but for extensions so substantial as to give rise to very much more congestion in the area concerned.
§ Mr. Maudling
The I.D.C. procedure applies to extensions as much as to new factories, but if people are already in a particular area it is much less sensible, obviously, to stop them from extending their factory than to stop people bringing a new factory into the area.
This is a matter not of law, but of administrative policy. The powers apply to extensions just as much as to new factories, but I think that in operating them we must consider not merely the question of local importance, but the interests of trade and the country as a whole and of the export trade as a whole. If we are too tight in granting extensions to factories, we may finish up by being frustrated in our purpose.
I come, finally, to the question of the administration of these powers which it has been suggested in more than one newspaper will be more important than the powers themselves.
§ Mr. Maudling
I am glad to have the right hon. Gentleman with me.
In the first place, we are streamlining—I think that that is the current phrase—the responsibility for the operation of these powers under one Department. I am sure that that is a sensible administrative improvement. Secondly, we are continuing the advisory committee. I am 45 glad to say that Mr. Slimmings, the present chairman of D.A.T.A.C., has accepted my invitation to continue as chairman of the advisory committee. I hope that his colleagues will be able to do the same, although it involves a tremendous amount of work for anyone who is actively engaged in other forms of business and industry. We are grateful to them for the work which they have been doing.
I think that most interest in the question of administration lies, first, in the nature of the list of places which will be scheduled by the Board of Trade and, secondly—this point has been referred to—the definition of a high rate of unemployment. It is our belief that in these matters it is essential to retain the maximum of flexibility, the maximum of ability to change to meet changing circumstances. I deliberately emphasised, earlier in my speech, how essential it is for this country to be equipped to meet certain changes with which we shall be faced in the next decade. We must be able both to add to the list of places to meet new difficulties as they arise, and also be able to subtract from the list of places receiving special assistance.
Of course, as everyone knows, in the past it has been much more difficult to subtract and easier to add—
§ Mr. Maudling
In 1958, the Select Committee said, with considerable force, that 20 per cent. of the country which was then the proportion covered by Development Areas was far too much. That, surely, is common sense. If we spread the "butter" in the form of the assistance available too far, there will not be enough to help where help is really needed. In these matters I think it most important to keep the list as short as is necessary and not to allow it to be spread too widely so that no place really gets the full assistance which it needs.
The present figure of the proportion of the country covered by Development Areas is, I think, about 19 per cent. which surely, as the Select Committee on Estimates said, is too much. If, on the other hand, we subtract areas which have been administratively descheduled and add areas now getting D.A.T.A.C. 46 assistance, we get to about 14 per cent. of the country as a whole. That, I should have thought, was a reasonable figure and I should be very surprised if our initial list departed far in global terms from the existing figure of the total of areas being practically assisted at present, either as Development Areas, D.A.T.A.C. areas, or both.
§ Mr. Douglas Jay (Battersea, North)
Can the right hon. Gentleman tell us now when the Government propose to publish this initial list?
§ Mr. Maudling
No, I cannot give a date for that. I think it right for us to get the powers first before we start to use them.[HON. MEMBERS: "No."] It would be quite wrong to publish a list at this time before we have these new powers, but I have been endeavouring to point out—this, I think, is the best thing I can do for the guidance of the House—that the list is unlikely, in global scale, to depart very much from the current 14 per cent. comprised by those areas currently receiving assistance under existing legislation.
Then there is the question of what is a high rate of unemployment. Here again, I say that it would be very unwise to fix a statutory figure. The needs and conditions of different areas are bound to vary, and, as we proceed with this policy and make progress, I should hope that we would be able to reduce the level, or criteria, of what is a high rate of unemployment. Therefore, I should be very much against inserting in the Bill any definition of a high or persistent rate of unemployment.
The other change in administration is the institution of industrial estate management corporations which will take over from the five industrial estates companies. This follows logically on the new structure introduced by the Bill. Instead of having the main five Development Areas we shall have a list of individual localities. Therefore the industrial estates company structure based on the old Development Area concept is not really relevant to the new concept we are introducing. We are to have three estate management corporations, one for England, one for Scotland and one for Wales, with a co-ordinating committee for the three of them. These 47 management corporations will take over the assets and liabilities and contracts of the existing companies.
§ Mr. Maudling
I think that we can say with confidence that the existing companies have done a very good job. I should like to pay a tribute to the work done by all concerned, including particularly those who have given of their efforts and work freely to the companies. I think that this change will be seen to be a change in conformity with the general principles of the Bill and I am sure that it will not detract from the efficiency of the operation of these estates.
§ Mr. Maudling
What I am saying is that instead of an industrial estate company for West Cumberland there will be an industrial estate corporation for all the areas in England receiving help under the Bill, which is the rational way of following the new concept in the Bill.
We have been asked how much money we are to spend on this programme. It is quite wrong to think of it in those terms. This is a programme for some years ahead, seven years ahead provided for in the Bill. We have provided for seven years because we believe that at the end of that period we shall have made really substantial inroads into the problem. Then it will be for the House to reassess the progress made, but it would be foolish to measure success solely in terms of money spent. No doubt we shall be providing in future Estimates more money than at present for these purposes, but the money we shall have to spend will depend actually on the needs of the areas and the number of firms and projects coming forward asking for assistance to establish themselves in those areas.
We must think in terms of assistance to the areas and not in terms of money we can spend, because it is easy to spend money and not get the results we can get, and which we are determined to get by the Bill. The Bill provides a new 48 framework for dealing with the problem of local unemployment and will add success in this field to the many that the Government have had in many other fields.
§ 4.15 p.m.
§ Mr. James Griffiths (Llanelly)
I begin by expressing one word of thanks to the Government, since I shall have many other words to say in the course of my speech today. That is to thank them for agreeing to the plea made by my right hon. Friend the Leader of the Opposition that the Committee stage of this very important Measure, which affects all of us and our constituents, should be taken on the Floor of the House. That has another advantage—certainly for me—because it enables me to deal now with what I think are the broad national implications of the problem underlying the Bill.
The Bill is called the "Local Employment Bill". I shall return to that point. We are dealing with a problem of immense importance for the future of Britain, and not for the first time. In 1939, a Commission headed by Sir Montague Barlow investigated the very important problem of the trends which were appearing in the changing situation of industry in the country—many trends which were dangerous to the future well-being of our land. It was asked to make recommendations to the Government on what should be done about the problem.
The Barlow Commission was the last Commission of its kind to make a thorough study of this problem and the way in which industry is moving in this planless, free-for-all society. It came to the conclusion, and made recommendations, that the Government should develop and implement a national policy for the location of industry in Britain and that that national policy should have full regard to three criteria.
Those criteria were economic, social and strategic. The first was that economic considerations should be taken into account and the second was of immense importance, as we can understand since the Commission met early in 1939 and reported early in 1940. It therefore said that one of the criteria used in the determination of the location of industry was strategic considerations. The Barlow Commission came to a conclusion about which the Minister said 49 nothing this afternoon, but about which, I hope, something will be said before the debate is ended. It was that we could not allow the location of industry to determine itself by the free play of forces. This is fundamental and I wish to direct the attention of the House to what is happening because of this.
The first attempt to adopt a national policy for the distribution of industry and to implement it was made in the Distribution of Industry Act, 1945. I wish to pay tribute to the tenacity and work done by Mr. Hugh Dalton in that field. If the Bill gets a Second and the Third Reading and eventually becomes an Act of Parliament, the first thing that will happen is that the Distribution of Industry Act, 1945, will disappear. The Title will disappear. Why have the Government changed the Title? The consequence is not merely a matter of words.
I shall quote from what the 1945 Bill included in its Financial Memorandum as being the purposes for which the Bill was being presented and for which the powers were being asked. If right hon. and hon. Members have a copy of the present Bill before them, they will see the difference at once. I believe that it is a difference not merely of words, but of philosophy and policy.
The 1945 Bill had this as its aim and purpose:The purpose of this Bill is to enable the Government to secure a proper distribution of industry over the country as a whole by stimulating industrial and social development of areas in which there is a special danger of unemployment …and secondly,by controlling further industrial development in other areas where such control appears to be desirable for economic, social or strategic reasons.In other words, the purpose of the 1945 Act was not only, or even mainly, to deal with pockets of local unemployment, but it was to deal with the problem on a national scale of bringing about some sensible distribution of industry in this country.
The new Bill reads differently. This is all that it says:The Bill repeals the Distribution of Industry Act, 1945 to 1958",50 including the part which I have read outand replaces their provisions by increased powers for providing employment in any locality. …I put this to the Parliamentary Secretary and I hope that he will reply: are the Government not only dropping the Title and the purposes of the 1945 Act, but also declaring that they have not and do not intend to have a national policy for controlling the location of industry in this country? If such control were necessary in 1939, it is certainly necessary now.
Let me deal with what I think is the basic problem with which we have to deal. In many respects the problem of the Development Areas is only a part of it. Ever since the end of the First World War there has been in this country a fairly continuous movement of population and of industry away from the old industrial areas in the North and in Scotland and Wales to the Midlands and the South.
§ Mr. Griffiths
I will discuss later whether it is a good or a bad thing. It is taking place at such a rate that we ought to consider it. I have my own views on whether it is a good or bad thing. No doubt the noble Lord has, too.
This movement began at the end of the First World War and developed a tremendous momentum in the 1930s. I believe that even the noble Lord will say that that was not a good thing. The 1930s were not good, were they? The movement was partly checked by the war and partly checked by the vigorous use of the 1945 Act by the Labour Government, but it has gathered momentum again. The President of the Board of Trade, who has to handle this problem, did not say very much about its magnitude and about what has happened in this respect since he and his party came to power in 1951. Let me give the figures to the House, because they are vitally important. I will come back to 1945, but I will begin at 1951.
Since 1951, the insured population of Great Britain has increased by just over 1 million. Half of this increase has been in three regions of the Ministry of 51 Labour—the London region, the South-Eastern region and the Southern region. Let me repeat those figures. Between 1951 and 1957, both inclusive, the insured population increased by just over 1 million. Half of the increase was in three regions—the London, South-Eastern and Southern regions of the Ministry of Labour. In the same period, 1951 to 1957, the net migration of workers into these regions from other regions in the country amounted to 142,000.
Let me put the other side. During the same period there was a net loss by migration from these other regions as follows: Scotland had a net loss of 49,000; the North-Western region of England had a net loss of 20,000; the Northern region of England had a net loss of 19,000; the East and West Ridings had a net loss of 21,000; and Wales had a net loss of 27,000. These regions, which are the old industrial areas of England, Wales and Scotland, suffered a net loss by migration into other areas, mostly the areas which I have mentioned, of 136,000.
That is one example of the trend. I put it to the noble Lord: does he think that this is a good trend? If he does, let me put the problem to him. If there is to be no control over the location of industries, then, in a short time, the mass of people in this country will be living in London and all the rest will be derelict. Let me give one other important example.
§ Mr. Maudling
The right hon. Gentleman has asked whether there is to be no control at all. I made it clear that the system of industrial development certificates would be continued and would be strengthened.
§ Mr. Griffiths
I was dealing not with the Minister, but with the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke). The noble Lord thought that there ought to be no control and no prevention of movement to the South. I will turn later to what the Minister said
Let me give a figure which I saw quoted the other day in the Economist. which was commenting on an address delivered to the British Association 52 meeting in September of this year by Mr. Powell, an official of the Ministry of Housing and Local Government. He was speaking about the problems of the Metropolis, its traffic, housing and all the other problems consequent upon the fact that industry and the population is drifting to this great conurbation, creating problems which, in a short time, will choke it and stop it.
Mr. Powell gave some figures which, I thought, were very revealing. Speaking of this London conurbation, which is greater than the L.C.C. and the Metropolitan area and is going outside them, he said that if the growth continues, then, in a short time, there will be a great London conurbation measuring 100 miles long and 100 miles wide which will swallow up almost the whole of the industry and population of the country. He said that during the last six years this area has spawned 400,000 new jobs, or 40 per cent. of the national increase in jobs in the last six years. This is the problem. In six years there were 400,000 new jobs in the London conurbation, or 40 per cent. of the national increase during that period.
This is the magnitude of the problem with which we have to deal. The Economist made three comments on it which I want to quote. I want to put them to the Minister and to ask the House to consider them. I also want to make some comments of my own upon these figures. The first comment was that the growth of London is occurring without any doubt at the expense of other less-developed regions, and that that is a bad thing for the nation as well as for the areas which are losing their men. The second comment was that as a new and more distant suburbia spreads around this conurbation the strains on the transport and the highway system grow alarmingly and are reaching the point at which they will be completely insoluble.
The third comment was that, having regard to this problem, to encourage greater economic growth in other regions besides London it will be essential to provide broader and different subsidies for industrial location and for transport, if we are to have a sensible distribution of industry in the country.
I want to deal with how we measure the percentage of unemployment. For 53 all these areas the percentage of unemployment as revealed by the Ministry of Labour is not a true measure of the loss which they have sustained or the problem which they have. They are all losing men to other areas. As a consequence, we have areas which have twice and in one or two cases three times the national average of unemployment. In my area the point is that not only have we a high percentage of unemployment but we are losing people all the time. We lost them in the 1920s and the 1930s and we are losing them now.
I see the right hon. and learned Member for Montgomery (Mr. C. Davies) here; his area has suffered from a declining population. We shall discuss this point in more detail in Committee, but I emphasise that if we say that unemployment in some places is only 2 per cent. or 3 per cent., we must look at the background. A fairer measure would be the number of insured workers they had twenty-five years ago and the number they have now.
Secondly—this is very important—they are losing the younger members of their population. That makes it even more difficult to attract new industries, because the younger people will have already left and the older people will be left behind. I am sure that that is not good for the country.
This becomes, in a sense, a vicious circle. The President of the Board of Trade is right in saying that one of the aspects of this problem, perhaps one of the most important aspects, is that these areas are losing their magnets. The magnet of South Wales was coal. So they came, took it away and sold it. They closed their pits and left their muck behind. Now, who is going to clear the muck? Who left the muck—private enterprise, coal owners. They made vast fortunes out of it and left the muck behind. I hope that all hon. Members will realise that one consequence of passing this Bill will be to make a subsidy to clear away the mess of private enterprise. Because of that, having lost our magnet, the magnet becomes, as the President of the Board of Trade quite rightly said, the market.
The more the trend continues, the more the market becomes great conurbations, the remoter other areas become and the problem becomes larger and 54 more difficult to solve. All of us know this perfectly well. Does the Minister propose to let this go on, or does he propose to deal with it? If he proposes to deal with it, is the Bill adequate? Indeed, even if the Bill is adequate, are the Government adequate, having in mind their record, to deal with the powers for which they are asking?
Whether for good or ill, it has become part of the work of Members of Parliament, at the request of local authorities in their constituencies to listen to their pleas for new industries to provide work. Otherwise, they can see their areas becoming depopulated and terrifying burdens on the country as a whole, and the whole structure of local government and social service breaking down. We all know quite well that, in response to our pleas, we are told that we are so remote. Some people have talked to me about Llanelly as if it is as far away as Timbuctoo. In a small island like this, with a population of 50 million, to talk about areas being remote is ridiculous. Therefore, we must not let industrialists get away with this. We must reverse the trend.
I come now to what I feel has become very urgent. This has gone on, is going on, and is growing in momentum all the time. Every new factory established in these conurbations draws other factories to it. It becomes a snowball. This can be measured mathematically. The computer can do it. The result is that in no far distant time we shall have vast areas in decay, and all industries and all the population living in two or three vast conurbations.
As a first step in dealing with that problem we should now put a fence round all these great conurbations and put up a sign saying, "Stop. No further industries must come in here". I ask the President of the Board of Trade to pay careful attention to this. I believe that we shall have to do it, otherwise everything will become choked up. People wishing to enter great conurbations will have to be told, "If you come in here to work, or if you bring your industry here, you will spend five times as long getting to and from work as you will in some other area. Motor cars will be bumper to bumper without any of them being able to move. The movement of traffic will become almost impossible". The amount of money the 55 nation will have to spend in trying to cope with the problem will be immense.
I believe that it is time that we had a national balance sheet on this.
§ Mr. B. T. Parkin (Paddington, North)
Before my right hon. Friend leaves the problem of the menace of great conurbations, will he make it clear that in London there is a very real problem that we are not attracting the newest industries; that we are already deprived of the opportunities of training the young; that it is about ten times as difficult for a school-leaver to get an apprenticeship or a job leading to a skilled occupation in London—[Laughter.] I do not know what hon. Gentlemen opposite are laughing at.
My right hon. Friend has been pointing out that workers have been leaving the old industrial areas. I am pointing out that they have been leaving their skills behind them as well. They come to the great conurbations to take on semiskilled and unskilled service jobs. The Greater London area is not an area of expanding trade and skilled modern industries. It is a lot of rubbish to say that it is accumulating here.
§ Mr. Griffiths
Maybe. All I can say to my hon. Friend is this, and I am sure that many of my colleagues and hon. Members opposite will know this, too. It was not from their free will and desire that they came to London. They were driven here by poverty.
For the reasons I have given, the great conurbations pose a problem which must be dealt with. I believe that the way to deal with that problem now is to perform a big surgical operation to stop them—no more industries; no more offices; no more developments to choke this area. If we do that as a beginning, it will be easier to encourage and stimulate them to go elsewhere.
This is a consolidation Measure.
§ Mr. Raymond Gower (Barry)
The right hon. Member for Llanelly (Mr. J. Griffiths) recommended putting fences round these great areas. While one may have a great deal of sympathy with that suggestion, what would the right hon. Gentleman do in the case of Fords, of Dagenham? Fords are doing extremely well. They are providing the country 56 with great exports and, in the reasonable course of events, need an extension to cope with their rivals overseas. Would not the right hon. Gentleman allow any extension in a case like that?
§ Mr. Griffiths
No. I think that I should say to Fords that, if this conurbation grows at the present rate, they will not be able to get their motor cars out of London.
The President of the Board of Trade was right when he said that the real test of this is not the powers, which are very largely consolidation with a few added powers which we can discuss in detail in Committee, but the administration of the Measure. Is the Bill a piece of window dressing, or do the Government intend to use these powers? I propose now to speak about the Government's record, because that throws light on this point. The Bill has been hailed as a great Bill. It was one of the features in the Tory Party's campaign at the General Election. It said, "We will deal with the problem of local unemployment. We will take new powers. We are going to do wonderful things." Apart from one or two powers which we can discuss again in detail, and which I do not think add much, the Tory Party has had all these powers all these years.
What have the Tories done with them? I propose to tell the House what they have done with the powers since they came to power in 1951. Then the House can judge what we can expect the Government to make of the new powers for which they are now asking, as well as the retention of the old. The only basis we have for comparison is the present development and other areas. I wish to compare the Tory Government's record with the record of the Labour Government from 1945 to 1951. From 1945 to 1951, 30 per cent. of all new factory building in the country was built in the Development Areas. In 1958, 18 per cent. only of the new industrial buildings was built in Development Areas. I will give a more striking contrast, and that is from my own part of the kingdom, South Wales. In South Wales, the amount of new industrial building declined from 5¼ million sq. ft. in 1951 to 1½ million sq. ft. in 1957, while in the Home Counties, corresponding with the regions I mentioned earlier, it increased from 4½ million sq. ft. 57 in 1951 to 9½ million sq. ft. in 1957. That shows clearly that the Government have not been using the powers they had.
Much will depend on how the right hon. Gentleman uses industrial development certificates. Until just before the General Election—was it window-dressing?—the Government used their I.D.C. powers scarcely at all. The President of the Board of Trade shakes his head, but I have given the figures. Does he deny them? In our time, 30 per cent. of the new building was in the Development Areas. In the Government's time the percentage in those areas has gone down and the percentage in other areas has gone up. Since 1951, the amount of industrial buildings in the Home Counties has almost doubled. Is that good use of I.D.C.s?
The right hon. Gentleman comes new to his office as President of the Board of Trade. I want to quote to him what the Financial Times said on this matter on 6th February, 1959. It said:There is a fairly widespread feeling among industrialists that if they hold out long enough the Board of Trade will eventually allow them to build where they like, rather than where it wants them to go.Is that true? We know, by the facts, that it is true. Therefore, I tell the Government that unless, when they get this Bill, they use its powers much more effectively than they have used their existing powers I shall agree with The Times, which said that effective use of the existing powers would be worth ten new Bills.
I should like now to deal with one or two aspects of the Bill and of the problem. We are now, perhaps, in the midst of the second industrial revolution. We can see what is taking place. We are in the age of atomic energy and of automation, with all its problems, I have seen this problem in my constituency—and I repeat what I have previously said. We welcome the changes that are taking place. We are not Luddites. New developments of all kinds, and new techniques, give us the opportunity to build an economy in which we can have real prosperity shared by all—and shared fairly by all—but we cannot allow all this development to take place haphazardly.
Does the President of the Board of Trade intend to deal with the tech- 58 nological problems and changes associated with this problem, with all their consequences to workmen and communities, by free-for-all and by consumer's choice? I wonder whether the farmers are willing to have consumer's choice. Are we willing to let agriculture operate like that? I do not think so. On agricultural matters, both sides of this House say that there are more important considerations than just those of pounds, shillings and pence—there are national and social considerations.
I, and those of my hon. Friends who know South Wales, know of one industry there that for over a century has contributed richly to Britain's life and to her exports. A decade ago, 400 mills employed 24,000 workmen to produce 20,000 tons of tinplate. Now two new works employ 4,000 workmen to produce more than 20,000 tons of tinplate—and better tinplate, too. That is but one example.
We know something of the cotton textile industry. We know what the workmen fear will happen in shipbuilding and ship-repairing. During the General Election many of us went to areas that have grown up round the railway workshops, and we know that those people are afraid that technical changes, combined with the policy of the Transport Commission, will adversely affect them. In the context of this changing economy and society, are we willing to let industry develop unplanned and uncontrolled?
The biggest problem of all is that of transport. The location of many industries has been decided by transport costs. I believe that we should think anew about transport; that we should think boldly about it, and ask ourselves why we should allow the location of industry to be determined, even against the national interest, by differentials in transport costs when, if we thought of transport as a public service for industry, we could work out the answer for ourselves. The time has come when we must be revolutionary in making transport equally available to people in Llanelly, Lancashire and the Merseyside and other parts of the country. I hope that we shall have an opportunity to discuss that.
We shall probably be able to speak in more detail about the Bill in Committee, but at this stage I would say that by this Bill the Development Areas disappear 59 and are to be replaced by localities. Is the House quite sure that that is the right approach? There is a good deal to be said for scheduling an area. What we have had, and may have again, is the breaking down of the integrated economy of an area in such a way as to affect a dozen or a score of villages, valleys or communities. There is everything to be said, as we found when we were in power, for treating an area as a unit, and planning the building of a new industrial life to replace that which has gone. I believe that we could have kept the Distribution of Industry Acts and the Development Areas and added the localities to them. That would be the right way, because areas planned with an integrated economy have great advantages.
The right hon. Gentleman said, quite rightly, that the powers in the Bill are limited to seven years. In the Distribution of Industry Acts, those powers were permanent. Why seven years? Do the Government think that they will have settled the problem in seven years? The President of the Board of Trade has not given a satisfactory answer to that, so we shall have to come back to it.
Let the Government and hon. Members opposite remember that, as Sir James Bowman said the other day, in the closure of pits and of tinplate and cotton mills we are dealing not with sticks and stones, but with living communities. The old areas are going—they are living communities—to Subtopia. Is that to the advantage of the nation? These are wonderful communities, and have had to struggle for all that they have. They have built community life.
The kind of industrial capital that has gone into them is but a tithe of the social capital that has been invested in them. Houses, services, churches, chapels, institutes—a rich communal life has been developed in those areas; and this country will be immeasurably poorer—and it will be a poverty that cannot be measured in pounds, shillings and pence—if those communities, with their sense of belonging and their people with deep roots and traditions, are allowed to die because the House and the Government allow industry to go just where it likes for the sake of a couple of pennies more profit.
60 Some time ago, a visitor spoke to a farmer on a hillside farm in South Wales. He asked the farmer, "What do you produce best out of this soil?" The farmer replied "Men." How true that is of the communities whose fate we are now discussing. They produce men, and this country will fare badly if, while its material production increases the quality of those men decays.
This is a problem on a national scale, and we must approach it on a national scale in order to make industry, both in its services and its location, the servant and not the master of the nation; and, by a wise national policy, ensure that those areas that have contributed so greatly to the country's life and have produced men and women of the type I have mentioned shall be saved. It is by that test that we shall judge the Bill and, even more, test the Government. Given a Government resolute to use them, these powers can solve these problems. Without that resolve by the Government, all the powers will be wasted. We shall judge the Government not by the powers contained in the Bill, but by their use of those powers when they get the Bill.
§ 4.50 p.m.
§ Mr. Percy Browne (Torrington)
I am grateful to you, Mr. Deputy-Speaker, for giving me this opportunity to speak so early in such an important debate, and I must ask for the indulgence of the House, as this is my first attempt. It is particularly necessary for me, because my predecessor at Torrington was described by the hon. Member who congratulated him on his maiden speech as having "political blood in his veins on both sides of the family." This was borne home to me shortly after the General Election when a telephone rang and a voice boomed into my ears, "This is Asquith's ghost speaking and I am very displeased with you".
This is, to my mind, a social rather than an economic problem that we are discussing. Is it economically sound to say that things should be allowed to run their course, thereby driving people from the remoter areas into the overspill of cities and making a mockery of the green belt? Conversely, we say, as this Bill does, that it is better to allow people to work where they live, which is what they want to do. In the end, it is in the best interest of all of us that they should be allowed to do so.
61 It is untrue to say that there are just a few black spots of unemployment. That belies the facts. There are vast rural areas which have a creeping paralysis of hidden unemployment, which cannot be measured in unemployment percentages, and one such area is the South-West. The right hon. Gentleman the Member for Llanelly (Mr. J. Griffiths) did not in fact mention us, but as a haulier and a farmer in my own division it is a problem which causes me great anxiety.
I was given a very good tip by a very important person. It was that when making a maiden speech, one should make one point only and say it in several different ways. Having a very large division, stretching from the outskirts of Exeter to the Atlantic cliffs above Bade. I must say a word about seasonal unemployment, which we have in such coastal holiday towns as Bideford, and which I am pleased to see is mentioned in this Bill. As the tide of holiday-makers pours in, so conversely our unemployment figures fall. They fell from 4.8 per cent. in February this year to 2.2 in July. Already they are rising again and today in this town they are 3.5 and likely to rise considerably higher.
Of course, we have conflicting interests in towns of this kind between those involved in the holiday trade, who fear that more industries will mean loss of their residue of labour, and, on the other side, those who want security of employment all the year round. To match up these two conflicting interests, it has been suggested that we might start a football pools firm, but now that there is some mysterious way by which one can punt on the cricket analysis in the summer, I do not think that would be much good. The local council has attracted new industry under the old Act, but this Bill is far superior to that Act, as my right hon. Friend said, because it anticipates trouble rather than waiting until it is already with us. However much help the Government make available for a local authority, it is up to both the authority and local employers to use it to the best advantage.
I return to my main point. This hidden unemployment cannot be put as a percentage. Large numbers of young men and women are leaving the remoter districts because of a lack of diversity 62 of opportunity. That is particularly true in all the remote parts of the South-West and it is no truer anywhere than in Torrington. It is a fact that, although we country people are no less fecund than the city dweller, 105 schools have closed in Devon since the war. This is partly due, I know, to the closing of all-age schools, but mainly it is the result of a lack of pupils and a lack of teachers That is the start of the vicious circle. These people go to the towns. The only real employment in our part of the world is farming, and as farms become more efficient and mechanised they employ less labour. The birthrate drops. The children are sent to town schools. They get a whiff of the town in their nostrils, and the village life, centred as it is around its church or chapel, seems tame by comparison.
We want three or four essentials. For a start, we want recognition that the farm worker is no longer a yokel with a bit of straw in his mouth, but is as efficient as, if not more efficient than, his city counterpart. We want increased amenities, the amenities taken for granted in the towns—electricity and water—and the ability to get from A to B in public transport. It is a fact that in the South-West Electricity Board's area, only 64 per cent. of the farms and cottages outside the towns are connected in this way. This is roughly six out of ten—an appalling figure. Whole hamlets are without main water, and branch lines are closing down. Perhaps the main problem is that of communication. We badly need better roads, it is no good trying to send industry down to us in any quantity unless first our roads are improved.
If we are to stop this drift from the land, we must take action more drastic and also more expensive than is proposed in the Bill. If we do this, not only shall we prevent an increase in the large cities, but the need for this Bill will not be so acute, for so many men and women find their way into just those towns which depend upon very few industries and which are now having these very high unemployment figures. If it is possible to fulfil these conditions, not only shall we be doing a great social service, but, by holding our rural population, we shall be able more easily to deal with the problem of overspill.
63 We do not want heavy industries. We want industries which will use our own raw materials, such as timber or china clay, thereby obviating the necessity of a long and expensive double haul. Perhaps, with hon. Members here from the Stoke-on-Trent area, I hardly dare suggest that it is no longer necessary to put the potteries next door to the coal mines, but it is sufficient to say that I haul china clay from Devonshire to Stoke-on-Trent and pottery back to Bristol.
Alternatively, we want the type of industry which has just come to Torrington, which gives its name to the division I represent, in which neither bulky raw material nor a bulky finished product is used. If we can do this, then, having started with a social problem, we shall find that we end up with a sound economic policy. If we encourage a thriving countryside, dependent not only on farming and on holiday trade as in our case but also on light industry, we shall have diversity of opportunity for our young people and we shall keep our community and our country alive.
§ 4.59 p.m.
§ Mr. James Boyden (Bishop Auckland)
It must be a somewhat unusual occasion for a maiden speaker to congratulate another maiden speaker, but I do so with a fellow sympathy and, at the same time, with great sincerity. I like to hear the voice of the country and I am sure that the hon. Member for Torrington (Mr. P. Browne) will embellish the debates of this House with the refreshing voice of the Atlantic seaboard.
I have a particular difficulty in speaking today, because my predecessor, who represented Bishop Auckland, was an expert in this subject and an architect of the revival of South-West Durham. My constituency is most grateful for the work that he did, and I am sure that Members of the House will feel grateful, too, for the work he did for nearly thirty years in this House. He was a Parliamentarian of outstanding quality and a man of great enthusiasms. One of the things that gives him the greatest pleasure is to think that some of his early enthusiasms—State forests, new towns and even extra-mural departments—have now become part of the Establishment.
64 The constituency which I have the honour to represent is a very pleasant one. With due respect to the Scottish Members, it has scenery unsurpassed in England—nay, in Britain. Its wild flowers are world-famous, notably the blue gentian, but, perhaps of more significance, it has within its confines football teams which are always in danger of keeping the Amateur Cup permanently in or near Bishop Auckland.
The working population of South-West Durham has a wonderful tradition of industrial responsibility, of inventiveness in railway engineering and mining and a great tradition of adult education. Indeed, this educational tradition goes back to the London Lead Company of over a hundred years ago and is continued in this century by active and strenuous branches of the Workers' Educational Association. Whether this tradition is responsible for the inventiveness or the responsibility, or even for the political complexion, of the area, I do not know. At least, it is a very sound tradition.
Today, however, we are faced with serious difficulties. The pleasantness of the land has a large cloud over it. I hope that the Bill which we are considering today will do something to mitigate the brutal economic forces which are now operating in Durham and, in particular, in my constituency. Since August, 1958, in the Bishop Auckland employment exchange area the unemployment rate has never been below 4.3 per cent. and in February this year it was 7.9 per cent. A month ago, it was 4.9 per cent. Our juvenile unemployment problem is particularly intractable. In the county as a whole, at the last count on 12th October, we had 1,149 juveniles still out of work, or three times what one might say was a tolerable position in the past.
The figures conceal real social difficulties. They conceal misemployment of young people, who often have to take jobs well below their capacity. They conceal long travelling distances from villages like Cockfield to Barnard Castle and Darlington, or from Middleton-in-Teesdale to Darlington, travelling conditions which it is not proper to impose upon young people.
65 The figures also conceal the serious problem of migration, to which my right hon. Friend the Member for Llanelly (Mr. J. Griffiths) has referred. In the bad old days of 1931–39, the migration rate from Shildon and Bishop Auckland was 13 per cent. In these relatively good days, it is still 6.5 per cent. There is serious disquiet in my constituency, both in the mining villages and in the country districts, at this serious situation. I hope that the Government will use their industrial development certificates in the way that many of us hope. I am pleased to hear of two loopholes which are to be closed, but I should like the President of the Board of Trade to scan some advertisements which have been cut out from the Financial Times and other newspapers over a period and from which he will read of 20 speculative factories or offices all being for sale or to rent in the congested areas. I beg of him to shut this loophole firmly.
My own private opinion is that we need office development certificates. In the North-East—and my hon. Friend the Member for Durham (Mr. Grey) will, no doubt, refer to this on another occasion—we badly need office work so that young people can take work suitable for their talents. There is a long-standing argument in Durham City, in which I am a constituent of my hon. Friend the Member for Durham, for Government Departments. I beg the President of the Board of Trade to use his maximum power to stop mushroom office developments in the congested areas and to steer some of them to our area.
I also make this suggestion in relation to non-ferrous mining. There are nine non-ferrous mining areas in the country where, the geologists tell us, there are substantial lead and other deposits at rather considerable depths. The exploitation of these resources is not beyond our capacity. Indeed, I would like to refer the President of the Board of Trade to the Mining Journal of 29th May. I understand that his predecessor was sent a copy. I hope that the present President of the Board of Trade has had a chance to read the article, which states that for the expenditure of about £300,000 in exploratory deep boring and other survey work it would be possible to set flowing about £5 million worth a year of lead and other products.
66 If it is not too much for the theories of the Government, I hope to see them reviving what was operating during the war—the Non-Ferrous Metals Development Company, Limited—to get on with this exploration. It would be of great assistance to us in Teesdale and to my hon. Friend the Member for Durham, North-West (Mr. Ainsley), who has the same problem in Weardale.
We on this side also ask—this is non-controversial—that more thought should be given in industrial research to looking into the future. The Economic Section of the Treasury is rather poorly staffed. Indeed, a former deputy-director of that section said that it wastoo small and too busy … for any profound study of long-term policy issues.We need a study of long-term policy issues and we also need considerable study of our local problems from the Board of Trade. In the county in which I have the honour to be a Member, the planning department of the county council spends a good deal of its time and energies in trying to do its own research and trying to attract industry by putting the economic facts of the county to in dustrialists. We need considerable strengthening in this direction from the Board of Trade.
I hope that the Bill will be administered with vigour. Its vigorous administration is more important than some of its Clauses. I hope that it will be administered so vigorously and with so much foresight that those of us who represent mining constituencies and rural constituencies—indeed, those of us from the North-East generally—will find, as 1960 goes by, that we have no more Questions to direct to the President of the Board of Trade or to the Minister of Labour.
§ 5.9 p.m.
§ Mr. James Scott-Hopkins (Cornwall, North)
It must be more extraordinary still to have a third Member making his maiden speech and congratulating another Member on the benches opposite on his excellent and interesting maiden speech.
I listened with great interest to the problems and difficulties that are being experienced in the North of England, as they are in the part of the West of England from which I come. I am 67 certain that the hon. Member for Bishop Auckland (Mr. Boyden) will be following in the traditions of his predecessor, Dr. Dalton, who, I believe, was extremely interested in these matters, and I am certain that he will be a worthy successor to him.
I would not have had the temerity to speak to the House so soon after my arrival here if it were not for the fact that this is a problem of tremendous urgency and importance in the West Country. Since the turn of the century we in North Cornwall have had a persistent problem of unemployment. The figures of men and women unemployed may not be particularly high, but the high percentage has constituted a very grave social problem. Cornishmen have been forced to go elsewhere to other countries, including England, to find the work to which they are fitted.
As I have said, this problem, unfortunately, has persisted since the turn of the century. At the moment we are suffering from a high percentage of unemployment. If I may have the indulgence of the House for a moment, I should like to give the figures in the main centres of my constituency. In New-quay, the percentage is 6.1, in Bude 2.9, in Camelford 6.7. and in Wadebridge 4.6. Hon. Members will notice that these percentages are high when compared with the national average. This is partly due to a seasonal falling off of trade along the coastal belt, but unfortunately the figures are still rising. Unemployment most definitely exists, and, as I have said, although the number of men and women involved is fairly low—about 800 men and 200 women—it constitutes a grave social problem for a sparsely populated rural area such as that which I represent.
This is not the entire picture. Like that of my hon. Friend the Member for Torrington (Mr. P. Browne), my constituency is an agricultural area. As my hon. Friend said, the agricultural problem disguises the real unemployment trouble. People are leaving the land and are going to the cities to seek their fortunes, and therefore they are not shown in the unemployment figures for rural areas In addition, there is the fact that we are losing the best of our school-leavers. It is a sad fact that in the part 68 of the world where I live, near Camel-ford, in the past five years 65.8 per cent. of the school-leavers from the grammar schools have gone out of the county for further education and have not returned. This is a very high figure. The cream of our young people leave to find jobs elsewhere.
The reason they leave is not because they want to go but because there are no opportunities suitable for their talents and training within their home area. I cannot believe that this is a good or healthy sign. If we combine this with what is happening in the agricultural areas, the trend of a shrinking labour force owing to the increased prosperity of our farming community because of new methods of farming and price stability, it will be realised that we are facing a very serious problem. People between the ages of 30 and 50 are finding themselves out of work, with no alternative employment to which they can go, and therefore are forced to either stay unemployed or to move outside the county.
I welcome the Bill because it will surely bring to us the benefits which the Distribution of Industry (Industrial Finance) Act, 1958, did not bring. The 1958 Act was the first step in bringing help to places outside Development Areas and I welcomed it then for that reason. I am, therefore, doubly glad that through this new Bill there is the possibility that we shall be able to reap added benefit from the powers which my right hon. Friend the Minister intends to take.
However, the crux of the matter in the South-West, particularly in Cornwall, is that our communications are bad. I should like to reinforce the plea of my hon. Friend the Member for Torrington that we need more road links with the main arteries of our transport system. I know that it is not possible to ask my right hon. Friend the Minister of Transport to give us priority in road development, which is going forward splendidly at the moment, but I would ask him, together with my right hon. Friend the President of the Board of Trade, to bear in mind the needs of the South-West, in particular Cornwall. We want a link between north and south of the county east of Bodmin moor. We want better communications over the Tamar, by 69 Launceston, with England, and it would be of great advantage to us if we could have them in the near future.
I hope that Clause 7 of the Bill can be extended to include some provision for a special freight rate on the railways for industrial materials if industrialists come to Cornwall. One of our difficulties in trying to attract industrialists to this part of the country is that in comparison with Scotland or Wales, we are very inaccessible and transport costs by rail are extremely high. If by this Clause some special freight concession could be given to us, I feel that it would be a great advantage to the industrialist who is prepared to come to the West Country. It would give him parity in costs with his competitors in other parts of England.
Finally, unemployment is really a social problem. A Cornishman is a man who has his roots firmly in the ground and does not want to leave the county unless he is forced to do so by economic circumstances. This has been happening for very many years now and that is why I ask my right hon. Friend the President of the Board of Trade to give the deepest possible consideration to the extension of his powers to give us in the South-West special consideration. People want to stay where they are and to find jobs near home which are suitable for their skills. As my hon. Friend the Member for Torrington said, they are people with a great deal of skill inherent in their bones. Let us give them the opportunity to use it. The reason I welcome the Bill so much is that I feel certain that we shall see in the years to come a very great improvement in the lot of those of us who live and work in South-West England.
§ 5.18 p.m.
§ Mr. Richard Kelley (Don Valley)
I understand that it is unusual for a fourth consecutive maiden speech to be made. Therefore, in the circumstances, I must ask for as much consideration from right hon. and hon. Members as the three preceding hon. Members received.
Coming from the Don Valley, I think that it would be only appropriate for me to refer to my illustrious predecessor, the Right Hon. Tom Williams. I think that his distinguished presence is missed from this House. I am sure that right hon. and hon. Members on both sides will bear with me when I say that 70 we all hope that in the very near future he will have sufficiently recovered from his illness to take a place in another building attached to this Palace.
In the Don Valley, the principal heavy industries are mining and agriculture. The Bill therefore is very important to my constituents. I have not had the opportunity of a superior education like some hon. Members who have spoken today, but I have had the opportunity of standing in a dole queue and I understand something about unemployment. I am very much concerned about the prospects of depopulation in the mining areas and the economic stagnation which apparently is creeping into the older coalfields.
I have read the Bill and I find that the Government appear not to be prepared to take certain powers which I think they ought to take to prevent the mining valleys from becoming empty and desolate. I refer to the question of opencast mining. I understand that there are 112,832 acres of land from which coal is now being extracted, land which is not being used for its traditional purpose—the production of food.
I am quite certain that it is both uneconomic and socially unjust to extract fuel by this method and to allow mining villages to become centres of unemployment where the traditional skill of the miner is simply thrown to one side. I believe that it would be much better, from a strategic point of view, if we left the opencast coal where nature has stored it instead of dragging it from the bowels of the earth and then stacking it around our pitheads.
The method of surface extraction was introduced to meet an emergency. I am afraid that we have not yet faced all the emergencies that we might have to face. It may be that it will be necessary for such methods of extraction to be hurriedly brought into operation to meet some future emergency. Therefore, in my opinion, it is wrong and wasteful to proceed with the extraction of coal by this method and to close down pits in the older mine fields. Were we to discontinue this method, the land would, of course, be brought into cultivation once more, the farmers would again roam their fields and bring them back to life and the country would benefit from the food which they produced.
71 It does not appear to me that the Government intend to take the necessary steps to provide the money with which to terminate existing contracts. I understand that that is one of the arguments being used against the discontinuance of opencast mining—that it would be a costly business because certain contracts would have to be terminated and compensation paid. The Government have the right to ask the House to provide the money with which to meet such contingencies.
Another argument also used in some quarters is that the discontinuance of opencast mining would render certain people in the civil engineering industry unemployed and that, therefore, we should just be transferring the problem from one industry to another and from one area to another. Such a result is not really necessary, because the men and the machines now being used for the surface extraction of coal could be readily transferred to solve one of our most grievous national maladies—road congestion—by the building of new roads.
The civil engineering industry is the most pliable and malleable industry in the country, particularly in present conditions. Therefore, I think that we should ask the Government to insert a Clause in the Bill which would enable them to take the necessary action to discontinue the production of several million tons of coal by the method of surface extraction and to transfer that production to the traditional method of mining so that the people in the mining areas may be able to look to the future with some hope of living a decent life in their valleys and villages.
Since 15th January this year, 23 men of over 35 years of age have left the pit in which I formerly worked, and have found employment outside the district altogether. Some have migrated and others have gone to areas in the country where lighter kinds of employment are available. Ten men have left because of long-term sickness, principally pneumoconiosis, a disease which renders them physically incapable of following the arduous work of mining. Seven men have died from various causes and 134 men of under 35 years of age have left the village. Out of 199 people who left that pit between 15th January and 24th October this year, 134 were under 72 35 years of age. That means that this problem is not only an economic one but a social problem. It is the distribution of population on the wrong lines. These villages must be kept alive. One immediate way in which they can be helped to live a little longer is by the discontinuance of opencast mining.
I sincerely hope that the President of the Board of Trade will take notice of what I have said and will take the necessary steps to have this practice discontinued forthwith in the interest of the permanent solution of the problem.
§ 5.26 p.m.
§ Mr. J. M. L. Prior (Lowestoft)
In congratulating the hon. Member for Don Valley (Mr. Kelley), I do so with a proper sense of my own position, rising as I do for the first time to address the House. I believe, in fact, that I am the fifth maiden speaker this afternoon.
I listened with great interest to the speech of the hon. Member for Don Valley, particularly his references to opencast coal mining. As a farmer, I can sympathise only too readily with his views on opencast mining. He follows in the footsteps of a great friend to the farming community, Mr. Tom Williams, whom I know every hon. Member wishes well and would wish to thank for his wonderful work. I wish the hon. Member for Don Valley every success in the House and I look forward to hearing him speak on another occasion when, perhaps, I shall be able to listen to him with more concentration than I have been able to do this afternoon.
A good many people have said to me over the last few years that they cannot understand why anyone would ever want to go into Parliament. They have also suggested that I must need to have my head examined. The right hon. Member for Llanelly (Mr. J. Griffiths) was worried about the conurbation of Greater London, and I think that some of my farming friends would probably say that I had been driven here by poverty, as a good many other people have.
My main reason in rising so early in my Parliamentary career is because my constituency, Lowestoft, has for a good many years suffered from the same sort of problems as have been mentioned already by other hon. Members this afternoon. In the Lowestoft division are a fishing port and an industrial town, a 73 considerable area of agricultural land and two or three market towns. Agricultural workers there are leaving the land as a result of mechanisation—I shall come back to that point in a minute—and this fact, coupled with the relative failure of the herring industry in the last few years, has created the present serious unemployment position, 9 per cent. or 10 per cent. of the population being unemployed.
I am a farmer, and I feel that we have a responsibility towards the agricultural worker and have to try to mechanise our farms more so that we employ fewer people but pay them a lot better than we are doing now. No one deserves a wages increase more than the agricultural worker, but I believe that if only we could develop industries in our market towns, that would provide the incentive for the agricultural worker to feel free to leave the land and to go into industry, which I feel he could well do, and it would force the farmer to mechanise more and pay his workers more. That would provide an impetus for the agricultural worker and for industry generally in my area.
I have mentioned that we have in Lowestoft a reasonable amount of industry, but we have, unfortunately, at the moment a very serious, problem in one industry—shipbuilding. I was listening the other day to the debate that we had on the fishing industry. Mention was made of the grants and loans for the building of new trawlers and drifters. I was thinking that in Lowestoft, before long, unless something happens fairly quickly, 700 men will be made redundant as a result of orders not coming to the shipyard. The cost of 700 men at £5 per week on National Assistance or unemployment benefit is £3,500 a week, which the country will have to find, at any rate for a short period.
If, with that £3,500 a week, we increased grants for building new fishing ships we could get greater modernisation in our fishing fleet—it was admitted the other day that it was slow to develop in parts of the country—and we could in specific areas, such as Lowestoft, enable men to be kept usefully employed pending an upturn in what we hope will be a short-term period of under-employment. I believe that there is a case there, outside the immediate scope of the 74 Bill, for immediate and flexible grants to be given to the shipbuilding industry in areas where it has been hit very hard to enable new ships to be built where they are needed; and no one will say that they are not needed in the fishing industry today. That is an example of how we could possibly help.
In trying to help new industry I hope that we shall not forget our existing industry. I have had something brought to my notice today which I think is of supreme importance to the country and to my own constituency. Anyone who read the Sunday Express yesterday will have noticed the front page reference to the Japanese incursion into Ireland to assemble transistors. I was glad to see that my right hon. Friend the President of the Board of Trade was watching this position carefully.
I believe that we have to watch very carefully the interests of our own industry in this matter and to see that the Imperial Preference given to the Republic of Ireland is not—should I say?—misused by the introduction of these Japanese firms into Ireland, because this could be a very serious matter for one of our most progressive industries, the radio and electronics industry. It is an industry which has one of the best records of labour relations, too. That could affect my own constituency very much indeed. I hops that the President of the Board of Trade will watch the position very carefully. I believe that we are negotiating a new trade agreement with Ireland, and I imagine that that will be one of the points which wants watching. As a farmer, I shall never buy any more Irish bullocks if anything goes through on that line.
Of course, we all want a lot from the Bill, and we hope that we shall get it. I would make one or two suggestions, as a result of local knowledge, which would not cost much money—that should give them an appeal for a start—but which would help considerably. The first one is this. In some areas, such as my own. in country districts where we have this problem, poor and widely spread districts, it would be a help if we could give a grant towards the cost of advertising our advantages. At present, we have a little piece of paper which is typewritten, and is sent out to 75 people whom we think may be interested in coming to put up a factory. It really does no good at all. If only we had some of the advantages of the bigger corporations and bigger areas we could show to the rest of the country what we have to offer. I do not think that this would cost much money, but it would be of very great value to us. I am thinking particularly of little towns such as Hales-worth and Bungay, with an 8 per cent. to 10 per cent. unemployed population. I think that we could help them in this way without a lot of expense.
We all want better roads and transport. I think that in the communications system East Anglia has always been neglected. One has only to go to Liverpool Street Station, or need have gone there at any time during the last thirty years, to know that East Anglia is the Cinderella of the country's communications system. They are improving very rapidly now. Indeed, we were presented with something on the train this morning which was quite remarkable, a pamphlet showing exactly why our trains are to run ten minutes late during the next six months or so. It is a good deal of improvement, because they have been running half a hour late without any explanation at all.
We think that we have a strong case for an improved road between the North Midlands and the whole of East Anglia, which would help our resorts. They keep closing our railway lines, so we do need something better in roads. That would help our coastal resorts and our industry very considerably indeed, and I hope that the Minister of Transport, among the many other considerations which have already been put to him in this debate, and, no doubt, will be put to him by every other speaker yet to take part, will not forget East Anglia, which does produce a fine type of man and one that we cannot possibly do without. Speaking as an East Anglian, I say that, of course, with a good deal of feeling.
Finally, I suppose that we all have to try to measure these things in terms of pounds, shillings and pence, but I belong to the younger generation which never saw the mass unemployment which afflicted the country between the wars, and I would say, speaking as one of those people, that I will never work or 76 stand for any party which would support a policy of unemployment. We have a duty not only in economic terms, but also in social and moral terms, to make certain of giving every man a fair chance of doing a decent day's work. If, as a result of this Bill, we achieve over a fairly long period a prospect of full employment and a chance of giving everyone of good will a chance to work, the Bill will be one which will be well remembered by the people of this country.
§ 5.40 p.m.
§ Mr. Sydney Silverman (Nelson and Colne)
I do not know whether it would be in order for me to ask the indulgence of the House. Since my right hon. Friend the Member for Llanelly (Mr. J. Griffiths) concluded his speech there have been only maiden speeches. As one who has probably addressed the House all too often, it might perhaps be suitable for me therefore to ask the indulgence of those who have been speaking for the first time. I suppose that it would also not be out of place if as an old Member of the House I were to offer my personal congratulations and, I think, the congratulations of other older hands, not merely to the hon. Member for Lowestoft (Mr. Prior) but to all those—perhaps the correct collective noun would be "bevy"—other hon. Members who have addressed the House for the first time today. They have all spoken with a confidence envied by all of us who remember the trepidation with which we ourselves embarked upon the same adventure. They have spoken with the confidence and clarity and with the helpfulness not merely to the House but to their own constituencies which entitle them to believe—and I hope they do believe it—that all of us look forward to hearing them often again.
The hon. Member for Lowestoft, of course, represents a gain to his party in the electoral results. He has spoken with great wit and lucidity, and he has added to the long list of things which all speakers so far in the debate on both sides of the House have demanded of the Government when once they have equipped themselves with the powers. I hope that he and the others will not be disappointed. I congratulate the hon. Member upon the effectiveness with which he did it. I hope, therefore, 77 that he in turn will not mind, since he graciously offered a tribute to the predecessor of my hon. Friend the Member for Don Valley (Mr. Kelly), Mr. Tom Williams, who preceded him, if I remind the House that what was a gain for the Government party was a very serious loss to our party. Mr. Edward Evans, who represented Lowestoft so well and effectively in the past, will be remembered by both sides of the House, by those who regret his loss and those who do not, with affection and respect.
In the debate last Tuesday on the Address, my right hon. Friend the deputy Leader of the Opposition reminded the House and the Government of a speech which the Prime Minister made long ago, and I take the liberty of quoting it again. The Prime Minister said:… the purpose of obtaining stability, order and co-operation in the new society, we shall have to place the organisation of the great basic industries and great basic utility services under some form of public control. That is the first object at which we should aim—the organisation of the production of goods and services upon the most effective methods open to us."—[OFFICIAL REPORT. 23rd March, 1938: Vol. 333, c. 1312.]When the right hon. Gentleman the Chancellor of the Exchequer came to reply, not of course being able to refute the accuracy of my right hon. Friend's quotation, he attempted a kind of gloss upon it and, referring to that quotation, he said:Of course, what my right hon. Friend was referring to is something that we all believe in here—What is it that the Chancellor said we all believe in here? It isthe advantage and importance of strategic planning …."—[OFFICIAL REPORT, 3td November, 1959; Vol. 612, c. 877.]For my part, I will accept that gloss. It is a great concession for the party of private enterprise to have made, that it accepts at any rate the necessity for this strategic planning of our great industries and our basic public services.
Strategic planning means central planning. In the end, it means Government planning, and I hope that we may now see an end of this arid, sterile debate between those who are for and those who are against public control, for it seems, if we are to judge by what the Prime Minister said twenty-odd years ago, and the Chancellor of the Exchequer said last 78 week, that we are all in favour of strategic planning and public control.[An HON. MEMBER: "No."] That is how I read it. No doubt the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke), who appears to dissent, will be able to put a new gloss upon it when he makes his own contribution and explains to us how we can have strategic planning, or whether the Chancellor of the Exchequer was explaining to the House his fundamental differences with the Prime Minister, who said that it could be done only with public control.
To bring the argument to greater relevance to our present debate, I suppose that no one would complain if we said that the Government offer the Bill which we are now considering as an exercise in strategic planning. Let us see how we are to judge it, not so much in relation to the speeches that have been made and the Clauses in the Bill, but to the way in which the Government have exercised this strategic planning in relation to the powers which they have had so far and what they are now proposing to do.
Those great areas which during the last twenty to twenty-five years have been accepted as Development Areas—South Wales, Tyneside and Scotland—have all been areas where the basic industry has broken down. The latest addition to them, the North-East Lancashire Development Area, is another case where the area has been declared a Development Area because another basic industry has broken down. It has never been a question of an odd spot here or an odd spot there. It has always been a question of the State using its powers, or at any rate taking powers which it could use if it wished to use them, in order to replan an area which had been largely dependent on a single industry where that industry had found itself in difficulty and no one could see a way out of it.
In so far as those areas are no longer in the condition in which they were at the time when they were made Development Areas, the change has been due not so much to the exercise by the Government of the day of the power that it had, but to the alteration in the general industrial and economic state of the country. If there are difficulties in the coal industry today, they are not difficulties that arise out of the organisation of the coal 79 industry. If there are difficulties in other places, they depend upon difficulties arising in the national economy as a whole.
Now let us see how this strategic planning has been applied by the Government so far to the new development area where another basic industry has broken down, namely, the cotton industry. Before dealing with it, however, let me point out to the House that the principal change proposed by this Bill is the removal of Development Areas altogether. It is not new powers which the Government are taking so much as the abandonment of old powers. We never regarded, and the Government never ostensibly regarded, those as powers to deal with some odd accident in some odd place. They were powers to produce an integrated plan for a whole area where the social machinery had broken down completely, where there was a vast drift of population, where the social capital of a generation or more was being wasted. What the Government are now doing is to approach the problem, not by taking new powers and developing those which they had before, but throwing away as a policy the planning of an area.
Now let us apply that to Lancashire. Cotton, of course, is one of our basic industries. It has been declining now for half a century. Without going into any controversy about the merits or demerits of the Cotton Industry Act, let us at least see what that Act set out to do. It began by saying that the productive capacity was too high. It then said that the Lancashire cotton industry must look forward to a restricted production in a contracting market. It pointed to the increased competition all over the world and added to its policy of reducing the productive capacity and contracting the market which it was intended to supply one constructive proposal, namely, the re-equipment and modernisation of such plant as remained.
All this is to be done with public money. We are dealing here with an industry which even more than other industries has prided itself on its individualism, which has resisted planning and organisation and integration of every kind, and which has made an enormous amount of money throughout generations and particularly in recent years. It would 80 have been easy to introduce new industries into Lancashire in the five or six years following the war, but then we were depending upon cotton to give us our first re-entry into world markets. We were in a situation in which our export trade had been sacrificed voluntarily for the purposes of a war and where we had to begin to rebuild an export trade in a country which depends on that export trade for its livelihood. So all parties—employers, employed, unions and employers' organisations—combined to persuade people to come back into the cotton industry and to remain there on the strength of a pledge that never again would the cotton worker be exposed to the grim and bleak tragedies of the mid-war years.
Yet, except for the period between 1945 and 1951, the cotton industry has been declining rapidly and we are beginning to get the results which were forecast. Last week the President of the Board of Trade was questioned about figures. He said he did not know the figures. Yet the figures are known, and I will now give him a few figures affecting the Nelson and Colne constituency. They are the figures of the Cotton Board. Hon. and right hon. Members will remember that under the Cotton Industry Act applications for compensation on the ground that a mill is to be closed and the machinery destroyed have to be made to the Cotton Board. If applications were made by 31st August people received rather more compensation than if they delayed until the final date, which was 30th September. This was because it was thought that the great surgical operation of cutting down the cotton industry ought to be done quickly. So inducements were given to those going out of the industry to make up their minds quickly and they received 5 per cent. if they made their announcement before 31st August.
Therefore, most of the figures were known to the Cotton Board by the end of August, and all were known by the end of September. During that period the Cotton Board, quite rightly, was writing to the areas concerned, and in particular to the North-East Lancashire development body, which consisted of representatives of all the local government authorities concerned, warning 81 them of the situation so far as it was then known to the Cotton Board. No announcement was made.
The right hon. Gentleman the President of the Board of Trade said last week, in answer to a Question, that there was an obligation of confidence placed upon the Cotton Board by the legislation concerned and by relevant legislation passed earlier. This was an obligation not to reveal applications or details of individual firms, but of course there was no obligation on the Cotton Board, and it could not have carried out its statutory duties properly, nor could the local authorities, if the whole of the information were regarded as confidential, and the Cotton Board did not so regard it.
These figures were known certainly as early as 24th September—that is to say, two weeks before the election—and probably for a long time before that. Now, the figures for the two towns I have mentioned are dramatic. I am dealing here with a part of the Lancashire cotton belt in which out of every three people who work two are employed in the cotton mills, and the cotton mills in those two towns are, almost without exception, weaving sheds. Therefore, the House will see, and I am sure the Minister of Labour will see, that any sudden contraction of weaving on a large scale must give rise to fear of imminent unemployment on a large scale.
The figures show that nearly two-thirds of the weaving sheds in Nelson and Colne have given notice that they will close down and that machinery will be destroyed. Notice has been given in this part of the area that virtually 50 per cent. of the weaving machinery will be destroyed. When inquiries were made by the various employment exchanges in the area to ascertain what would be the likely effect on employment in the area of destroying that proportion of the weaving machinery in it, it was found that in Nelson the anticipated figure of unemployment would be 38 per cent. This is right back to the figures of the middle 'thirties for all the Development Areas.
I do not want to conceal from the House for a moment that there are certain compensatory features. It is said that some day the mills, under the same Cotton Industry Act and with Government 82 financial assistance, will be re-equipped, and that when they are re-equipped and more efficient they will be able to work a shift system. As hon. Members know, the shift system has always been unpopular in Lancashire. It is said "There is already a shortage of labour in the textile mills. There will be re-equipment and it will be possible to work a shift system, and when the re-equipment has taken place and a shift system has been worked out, and accepted by the textile unions, then a proportion—nobody knows what proportion—of the unemployment brought about by this enforced and induced contraction may be taken up."
Where is the strategic planning in this—first, to destroy the livelihood of 38 per cent. of the working population of an area, and then to say, "Do not worry about that. Some day—nobody knows when—there will be some degree of re-equipment—nobody knows what—and when these two unknowns have been ascertained there will be a reabsorption of some proportion of labour—nobody knows how much."? Is this what the Government call "strategic planning"? Do the Government pretend that under this Bill, even if they use their powers with very much more energy and enthusiasm than they have ever used any powers which they had before, they will be able to deal with this immediate problem?
Surely, if one believes in strategic planning one does not confine oneself to a plan about an industry. One tries to plan the area. One lets two things pursue parallel lines: as one destroys one industry, at the same time—or before, if one can—one builds up new industry so that there is not the immediate creation of a vast army of unemployed people waiting until some later date when something or other may be done about the situation.
Compensation is to be paid to every mill owner who destroys a loom. I have not worked out the figures—no one can work out the figures accurately—but it is a reasonable approximation that the mill owners who are to destroy the looms and so produce perhaps a 38 per cent. unemployment rate will receive compensation of perhaps £1 million. Some of that will go to the workers; very little of it will, but some of it undoubtedly 83 will. However, a round figure of £1 million will be received by the mill owners who destroy the looms as a condition for undertaking that the looms go out of the industry for ever.
When the Cotton Industry Act was going through the House, my right hon. Friends and I sought to persuade the Government to make Amendments. One of the Amendments that we sought to induce them to make was the following. We said, "If you are really going to spend public money as a bribe to people to go out of the industry and to destroy its tools, at least do not give it to them without condition. In a small area £1 million is real money, real capital. You could do a lot to introduce new, light, alternative industry if you had at your disposal the £1 million which is being spent for a public purpose by a Government which believes in strategic planning."
§ Mr. H. Rhodes (Ashton-under-Lyne)
On the basis of 104,000 looms, the amount of compensation is more likely to be in the region of £4 million.
§ Mr. Silverman
I am sure my hon. Friend will appreciate that I am dealing only with my own constituency, and I am dealing with it because there we have probably a higher concentration of employment in the one industry than there is elsewhere in the area. The position is serious enough elsewhere, but I do not think it is quite so dramatic elsewhere as it is in Nelson and Colne.
We said, "Why not make it a condition that if persons accept public money as compensation for this purpose they shall at least use it as an investment to bring into the area industry to take the place of that which is being destroyed?" No one was suggesting that the money should be taken from those people, and no one was suggesting that it should not earn a reasonable commercial profit if they could organise industry efficiently enough to produce it. Surely it would not have been too great an interference with the ideas that right hon. and hon. Gentlemen opposite have about not interfering with people's property to say, "This, after all, is not your property. This public money is being paid to you out of public funds. Use it for a profitable purpose by all 84 means, but use it for a profitable purpose in the area where you are destroying the livelihood of so many people." But the Government refused to do that.
We now have the situation that I am describing in which 62 weaving sheds are to be closed down and half the looms are to be destroyed and there is no power to provide that the compensatory capital paid by the State to the mill owners shall be used to build up alternative industry. What is to be done with these towns?
It will be no use looking for the percentage unemployment, because maybe the 38 per cent. will never be shown on the books. In this part of Lancashire and in other parts of Lancashire, and I dare say also in other parts of the country, people do not stay at home, parading their poverty, distress and unemployment on the street. They drift away. Does it not matter? Here we have houses, streets, schools, amenities, public services, transport—which could be better, but, nevertheless, it is transport of a kind. Why, if they believe in strategic planning, do the Government regard it as a good thing to destroy an old town and all the social capital it contains and then come to Parliament to raise further millions of money in order to build new towns in which to house the people whom they are driving out of the old ones? Strategic planning? If we had had that sort of strategic planning during the war, where should we all be now?
I do not want to prolong the agony or to take away more than I need of other people's time to contribute to the debate. I can see nothing in the record of the Government and nothing in this Bill that brings any hope or comfort to towns of this kind, looking forward bleakly and grimly to what could be a very grim future indeed, and it is not necessary. If the Government really wanted to take powers and use powers, none of these tragedies would occur. These people are being made sacrifices to the dogmatism of people who, forced to admit the necessity of some kind of planning, nevertheless feel themselves inhibited by their general social and economic ideas from making or using the powers which would enable them to plan at all.
I understand that the right hon. Gentleman the Minister of Labour is to reply 85 to the debate. He will almost be making a maiden speech himself when he comes to wind up the debate, and we shall give him whatever indulgence he deserves when that time comes. That may be an equivocal promise, but it is no more equivocal than this Bill, and no more equivocal than the promises which the Government are holding out to the workers in towns of this kind. I beg the right hon. Gentleman to realise that there is a serious, if not a tragic, immediate problem here, that if anything is to be clone about it, it has to be done quickly. It has to be done boldly. It has to be done with energy, and with a belief in the necessity for doing it.
It will not do to say, "We will wait until we have got the powers," as was said by the Minister earlier today. It will not do to say, "We will wait until the percentage of unemployment is shown on the register of the employment exchange." If we are to deal with these matters at all, we have to deal with the situation before it becomes intolerable and before it becomes unmanageable, and it is just that which in the last eight years the Government have failed to do.
This is not a new problem in the cotton industry, or in Lancashire, or in this constituency, which had already lost more than a third of its factories between the year in which it was designated a Development Area in 1951 and the year in which the Cotton Industry Act brought about a further contraction even more speedily than the contraction which it had suffered before. We warned the Government about it during all those years. Questions and debates between 1951 and 1959 met with no response or negative answers. Nothing was done, though certainly there was the declaration of the Development Area, but no powers were used and no improvement was brought about.
We look with great fear on what is now going to happen immediately, and we wait with great interest to see what the Minister of Labour is to tell us tomorrow night.
§ 6.16 p.m.
§ Sir Robert Cary (Manchester, Wellington)
In following the hon. Member for Nelson and Colne (Mr. S. Silverman), perhaps he will allow me to say to him that for more years than I care to count I have heard him pleading so vigorously 86 and so energetically for the cotton industry in Lancashire. My mind goes back to pre-war days, to those debates on the condition of the people against a background of immense unemployment, and in a period when my right hon. Friend the Prime Minister made those speeches from the fourth bench below the Gangway, part of one of which the hon. Member quoted.
The implication of citing the Prime Minister's words in those years is to present him as an advocate of nationalisation. He did suggest some form of control, and when he was the hon. Member for Stockton-on-Tees he invited a degree of Government intervention which was tantamount to guidance, rather than the outright basic nationalisation of any particular industry. It is hard to cast one's mind back to the exact circumstances in which these speeches were made, but I think that it would be wrong of the hon. Gentleman to read into them an enthusiasm in those years on the part of the Prime Minister for the basic nationalisation of some of the country's industries as a means of curing the great unemployment problem.
§ Mr. S. Silverman
I have taken a long time, and do not wish to take further time now, but the hon. Gentleman must look at the Prime Minister's words. They are quite clear. It is true that he did not use the word "nationalisation", and in all our discussions on this matter we tend to discuss the words without paying much attention to the ideas behind them. The Prime Minister was then in favour, and presumably remains in favour, of public control of our basic industries and basic services, and the Chancellor of the Exchequer is in favour of the strategic planning of them. That will do for the moment.
§ Sir R. Cary
I accept the hon. Gentleman's invitation and, if he likes, guidance to myself. My own impression of those years was that the Prime Minister did not favour particular Government policies then being pursued. He was pleading for his course of action almost on his own, and I think that the time must come when he will answer these matters for himself.
The hon. Member pitches the Bill too high. It is a limited Bill. In the sense that it does not go too much on party lines, it is a national Bill. It is a Bill 87 of prevention and inducement for a social need of the moment. It inspired the right hon. Member for Llanelly (Mr. J. Griffiths) to lift it to the level of the 1939 discussions on the location of industry and those on the Distribution of Industry Act, 1945. But those Measures were at a higher level.
§ Sir R. Cary
That is not for me to explain.
The right hon. Member for Llanelly and the hon. Member for Nelson and Colne asked why the Bill set out to abolish the 1945 Act and to isolate the conclusions about the location of industry which were reached in 1939 and in subsequent minor legislation in that respect. No doubt we shall hear why the Bill is limited, since it does not operate in terms of the distribution of industry or the location of industry and is described as a local employment Bill.
§ Mr. S. Silverman
Does not the hon. Gentleman see the importance of that? If the Government repeal those Acts, which dealt with Development Areas, and substitute one dealing only with local employment, then they do exactly that of which my right hon. Friend the hon. Member for Llanelly (Mr. J. Griffiths) accused them.
§ Sir R. Cary
If, in the changing circumstances of our time, the Distribution of Industry Act becomes unworkable, then it is better to replace it with a Bill which does not set its sights so high and which is a Local Employment Bill to meet emergencies in different localities.
I assure the hon. Member for Nelson and Colne that the Bill will be tremendously important in our own industrial area of Lancashire. Some Lancashire mills are rapidly being occupied and converted to other purposes. The Government propose to make payments for the creation of new factories. The cost of building a new factory will be about 50s. per square ft., yet during the last year many cotton mills have been vacated and offered to industry at between 2s. and 10s. per square ft. and could be occupied as sound buildings by other industries. Only last Friday, I spent some time with the Secretary of 88 the Lancashire and Merseyside Development Council, who gave me many good illustrations of what is now happening.
If my right hon. Friend the President of the Board of Trade is to encourage new industries to go to areas like Manchester, will he first consider the possibilities of existing properties, such as cotton mills, which may become available for alternative industries before he invites those industries to launch out into the building of new premises? That would be very important for areas such as that which the hon. Member for Nelson and Colne has represented for many years, because giving advantageous terms for the conversion of a mill, which would cost very little to occupy, could be the difference between a business beginning production in the area and having to wait while entirely new premises were built.
There is another matter which I wish to discuss, and which arises out of Clause 5. My right hon. Friend spoke of unsightly and derelict areas being tackled under the Bill, either directly by the Government, on an amenity basis, or through the provision of funds for local authorities to do so. In many areas of the country, not only in Lancashire, there are places to which it is exceedingly difficult to induce people to go to start new businesses. The earth is destroyed or worked out. In Lancashire, in particular, we suffer from mining subsidence and from opencast mining. In the area which I have represented in previous Parliaments—wider than my present constituency—in that north-eastern area of Lancashire to which the hon. Member for Nelson and Colne referred, this problem is a tragedy. I see it every day, for instance, in my activities as chairman of Lancashire United Transport. The condition in which these areas have been left from the first industrial revolution is desperate.
My right hon. Friend said nothing about what Clause 5 could do in the immensity of the task of cleaning up old areas such as the north-eastern area of Lancashire. For instance, what are we to do with derelict areas such as that between Atherton and Leigh, derelict areas which cannot be used for housing and where industrial contraction over the last few years has resulted in a denial of transport facilities? I hope 89 that my hon. Friend the Parliamentary Secretary to the Board of Trade will take note of the excellent maiden speech of my hon. Friend the Member for Torrington (Mr. P. Browne), who pleaded for consideration to be given to transport facilities in rural areas.
This is a matter which does not immediately concern the President of the Board of Trade, but does directly concern my right hon. Friend the Chancellor of the Exchequer. One remembers our Budget debates and the Chancellor's refusal to reduce fuel duties, in spite of Amendments from both sides of the House. Rural transport has been cut back and if we have a severe winter hon. Members from rural areas will have many bitter complaints from the general public.
The Treasury has a responsibility vis-à-vis transport when areas are singled out for new industries. Over and above that, I do not see how it is possible for new industries to go to some of the semi-rural areas of North Lancashire unless transport facilities are greatly improved and many bottlenecks eliminated. We may have the sites and labour force available, but unless these ancillary matters are dealt with, not much progress will be made in tempting industries to fresh sites.
As the Committee stage of the Bill is to be taken on the Floor of the House, many of the matters that one would snatch at now and raise on Second Reading are better left until then. However, it is important to bear in mind that the Bill, by itself, is not a large and vast comprehensive Bill which will earn for itself the title of an essential part of stategic planning. Indeed, in the present condition of the country, I do not see the Government being required to take such powers. What the Bill sets out to do is to help us, each and severally, in our constituencies to deal not only with pockets of unemployment, but to cooperate, perhaps for the first time, with the Government in anticipating unemployment.
The Bill provides many benefits that we have not had before. One such benefit is to enable us to move a family to another part of the country and pay for the move by money provided by the Treasury. This is a substantial concession. If the House, in accepting the Bill, 90 can make a success, or even a partial success, of the widening out which must come from planning, the direction and location of industry as a whole may follow in its footsteps.
The Bill that my hon. Friend the Parliamentary Secretary and his right hon. Friend have brought before the House will benefit the Lancashire area. I ask my hon. Friend to co-operate with the Lancashire and Merseyside Development Council to see whether there do not perhaps exist sites which could be embodied without the expenditure of any Government money.
§ 6.33 p.m.
§ Mr. Douglas Houghton (Sowerby)
During the early part of his speech the hon. Member for Manchester, Withington (Sir R. Cary) seemed bent on cutting the Bill down to size, but before he finished speaking he had expanded his demands on it to match those made in four excellent maiden speeches from the other side of the House. No Government, not even one with a will to act, can do everything in one Bill; but a Government which lacks the will to act and which has approached this problem tentatively and hesitatingly will probably not do very much in half a dozen Bills. As several of my hon. Friends have said, this Bill will be judged by its results.
This is the Bill that we heard of during the General Election. It is the first major Bill of the new Parliament. The second Bill will be the Betting and Gaming Bill. This Bill has to be judged on its claims to be a major Bill by what it does different from the past and not merely by the consolidation nature of the Bill and the tidying up process that it undoubtedly undertakes. One thing that this new major Bill does is to sweep away the phrase "distribution of industry" from our list of statute laws.
In that respect it seems to do what the hon. Member for Withington said that it does. It abandons what I believe he said was the "unworkable" distribution of industry and concentrates on pockets of unemployment. In that sense it is retrograde unless the wider issues are to be dealt with by other Bills or Measures and there is no sign of that. There was nothing in the speech of the President of the Board of Trade which 91 foreshadowed other Measures to deal with the wider issues.
My right hon. Friend the Member for Llanelly (Mr. J. Griffiths) spoke about the drift of industry from the North to the Midlands and the South, and the growth of the monstrous congregations of population in this part of the country. That is a social and industrial problem even though there be no unemployment problem at all. This may have to be considered as a manifestation of the present tendency of industry, and looked at in its social implications.
One might ask why these people want to come to the South. Labour is short, wages are high, and services and housing are difficult to come by. It is not easy to see why there is this constant drift down here. Prestige may play a large part. I believe that in some quarters there is a feeling that one must have prestige headquarters in London, or there must be a new part of one's industrial activities near to the centre of finance and other similar industries. I do not know. I think that is something that ought to be inquired into.
This situation is showing up large administrative problems. London can no longer supply the labour force that it requires and yet these industries still come down South. In one branch of public administration of which I have close knowledge we have reached the rather absurd position of having ceased to recruit people in London. We recruit them in the provinces and when they are nicely settled down they are compulsorily transferred to London. That is how that branch of public administration is being supplied with its necessary additional labour force to meet the increasing activity in business and industry in this area.
Because there has been so much criticism of public administration on different occasions I must say that at least this one—and I refer to the Inland Revenue Department; I have perhaps scarcely concealed that from the House—is now transferring work out of London. That is an example which other organisations might follow. P.A.Y.E. assessments of all those employed by the London County Council are now dealt with in a Liverpool office. The Inland Revenue Department has offered a special 92 facility to those who want to ring up the inspector of taxes who deals with their Income Tax. Anyone can ring through to Liverpool for the price of a local call. This is being done so that the taxpayer concerned should scarcely notice that his Income Tax is now being dealt with on Merseyside. That is a problem which, quite apart from unemployment, has shown itself in these crowded areas.
I do not propose to embark on this wider question of enormous importance, that of redrawing the industrial map of Great Britain. I believe that in the next ten, fifteen or twenty years remarkable population and industrial changes will take place It is extraordinarily difficult to see what problems that may create, or how the House of Commons will deal with them.
I want to spend a few minutes on the Bill itself. I am glad to see that at long last the threat of imminent unemployment is written into the Bill. On several occasions I have criticised what seemed to be a fundamental weakness in this legislation, namely, that it was not until unemployment had reached a high and persistent level that the provisions of the Distribution of Industry Acts could be invoked. During the Committee stage of the 1958 Bill the Minister of State assured us that the Government would not interpret the word "persistent" in a historic sense. He said that they would not look over their shoulders, but would be forward-looking in their interpretation, and if there was a definite threat of unemployment it would be possible to regard that as future persistence.
I notice that there are two alternative terms on the first page of the Bill. The Long Title refers to unemployment which is "threatened" and Clause 1 to unemployment which is "imminent." I suppose they mean the same thing. I hope that we can clearly understand, as the Minister seemed to make plain this afternoon, that where a definite expectation of unemployment arises the Bill can go into action. If that is so, it will be a better Measure than the old one.
As the hon. Member for Withington observed, we are to take the Committee stage of the Bill on the Floor of the House. That will mean that we shall have opportunities to talk about a number of points arising on the various Clauses—and many points will be raised. 93 But there is one very important question which was not cleared up to my satisfaction in the right hon. Gentleman's speech this afternoon. I am thinking of the transitional period. The Third Schedule wipes the slate clean of three previous Distribution of Industry Acts. We start afresh. When the Bill becomes an Act it seems that nothing will be left of the previous legislation except the hang-over of expenditure or commitments the continuance of which is provided for in the Bill. There will be no Development Areas when the Bill becomes law, and there will be no areas scheduled under the D.A.T.A.C. arrangements in the 1958 Act. We shall be making a fresh start.
Another thing that worries me is that in the very last Clause reference is made to the fact that the Bill will come into operationon such day as the Board may by order made by statutory instrument appoint.Whether the provisions of the existing legislation will continue to the day appointed for the beginning of the new Act I do not know, but it is important that many uncertainties of the situation should be removed. I see no reason why the President of the Board of Trade should not disclose to the House what the list will look like when the Bill becomes law.
That is important, because the right hon. Gentleman said that at the moment about 19 per cent. of the country is scheduled under existing legislation but that only about 14 per cent. is effectively within the activity of existing legislation. There appears to be a margin of 5 per cent. in respect of areas already scheduled which the Department has administratively descheduled. It may be that those are the areas in respect of which hon. Members on both sides have been looking for activity and have been disappointed at finding none. They have thought that this was just one of the customary palsies of Her Majesty's Government, but it may be that, in fact, the officials of the Board of Trade have already crossed off those areas from the list, and that nothing was to happen anyway. We ought to be told what areas have been effectively descheduled, so that we may know what we are doing.
I will not pretend for a moment that I accept all that may be said about the 94 claims of existing areas to remain scheduled. Not all those claims can be fully substantiated. Most of these areas went into the Distribution of Industry Act, 1945. That was fourteen years ago, and a great deal has happened since then. I know that additional areas have since been created, and I also know the difficulty of getting any town scheduled, even under the 1958 Act, which was not included in a Development Area in the past. That has proved most difficult. The 1958 Act brought fresh hope to those towns, and I must acknowledge at once that one of them, in which I am particularly interested, and which is the only town in the West Riding to be scheduled under the 1958 Act, was specially grateful for the flexibility introduced at the time.
But the House will remember that the additional areas to be scheduled were additions to the old ones. There were no subtractions from the old ones in the 1958 legislation. I speak with some diffidence on this point, because I know how sensitive some of my hon. Friends are about it, but there may be a case for a revision of the existing areas, having regard to the changes in the pattern of industry and unemployment which have occurred since. The Bill will provide the opportunity to do that, and it is as well for us to know the scale on which this is likely to happen.
That is the most important of the points I had in mind. Whether we shall be in the new areas or not, we are all anxious to know where our particular trouble spots will stand in the new list to be drawn up by the Board of Trade.
Although the Government have ruled out direction—and in present circumstances direction would probably be extremely difficult to impose—their encouragement and suggestions must be positive. They must use their best endeavours, as well as the maximum inducements, to get new industries into certain areas. I have no quarrel to make with what has been done under my observation so far; on the contrary, there is considerable appreciation of the energy and success with which the regional officers of the Board of Trade have worked in my constituency. That may be because Todmorden is a newly scheduled town and it has opportunities which are more attractive to 95 those considering the location of new industries. However that may be, those efforts should be consistently and un-flaggingly used over the whole area which may eventually come out of the change in the areas to be scheduled under the Bill.
If that is done, the Bill will achieve something more than the previous legislation has. How much more, it is difficult to say, but the Bill will provide powers for more to be done, and if more is done, the Bill will justify itself to the limited extent to which it proposes to go. That will still leave some very big questions of our industrial and social life to be debated, which will probably cause considerable worries among hon. Members on both sides of the House.
§ 6.50 p.m.
§ Viscount Hinchingbrooke (Dorset, South)
No fundamental opposition to this Measure is voiced by right hon. and hon. Gentlemen on the other side of the House, and it falls to me to supply it. Whether I shall be lucky enough to be followed by other of my hon. Friends remains to be seen When hon. Members are confronted with the need to oppose a Measure involving large changes in social life, they are, I think, called on to have a look at the quantifying of that idea in terms of money. If it had been the fact that the portals of these various Distribution of Industry Acts were wide open to the extent of £300 million or £400 million of the taxpayers' money pouring through them every year, I should hesitate to try to bring about the cataclysmic social change such as would be involved in the stopping of the whole process. But there are only at the present moment about £3 million or £4 million a year proceeding to be spent in this particular way. and nothing very terrible will happen if that process is arrested and something new is invented to take its place.
My right hon. Friend the President of the Board of Trade, in his usual genial way, introduced this Measure as one of major importance. But I cannot believe, in the light of what I have just said, that it can be so regarded; and it will not be so very shattering to the Government's prestige if it is forthrightly opposed and even if it is defeated on Second Reading. I was opposed to the Distribution of 96 Industry Measure in the last Parliament, together with some of my hon. Friends, and we gave a series of very cogent reasons why we did not like it. Nevertheless, it passed into law.
During the election I took particular pains to say in my election address and in my adoption speech that I was wholly opposed to the extension of the Welfare State from the individual to businesses in distress. As this Bill enshrines in part the idea of businesses in distress, it is the first opportunity I have to redeem the pledges which I gave to the electorate in my Division a few weeks ago.
§ Mr. Rhodes
May I say to the noble Lord that he had an opportunity when the cotton industry legislation was debated and he did nothing about it; when, according to the Prime Minister during the election, £50 million to £60 million was distributed in Lancashire.
§ Viscount Hinchingbrooke
I did, in fact, oppose the Cotton Bill, not in quite such a forthright way as I am doing now, for the reason it was a Bill dealing with an industry localised to some extent in a part of the country very far removed from mine. Although I felt I was electorally safe in my own division had I attempted to intervene, at any rate I left it to others to carry on the discussion.
§ Viscount Hinchingbrooke
No, I shall not give way to my hon. Friend, who I know is anxious to speak.
I should like to know who in fact prepared this Bill. I very much doubt if the President of the Board of Trade saw it before it was a Bill and placed on the Table. I very much doubt whether the Cabinet spent anxious hours over it during the summer. Certainly the idea has never been brought to the Floor of the House in the last few months, and to my certain knowledge not to the Parliamentary party on this side of the House.
I have come to the conclusion, therefore, that the Bill has been prepared by those now very well-known people, the "sorcerer's apprentices"—those sleek young gentlemen who inhabit Transport House, the Conservative Party Secretariat and the Ministries, particularly the Board of Trade. In the absence of the Cabinet, whose thoughts 97 are elsewhere, in the absence of Parliament which is debating something quite different, these young gentlemen all get together and plan the processes of legislation in this country of ours. I hope very much that they are going to be shown up from time to time for the mischief they do.
I do not want the House to think—I said this during the discussions on the Distribution of Industry Bill—that I am opposed to the relief of unemployment as such. Individual unemployment is a social disease, and from time immemorial the State has developed ideas to cope with it. Today we have, perhaps, the most comprehensive social legislation in the world to cater for industrial unemployment, sickness and other disabilities. The State is justified in calling on the taxpayer to look after the individual's disabilities in any walk of life, and I hope that in the months to come we shall improve substantially on that principle.
Local unemployment, too, is a social disease and must be catered for in some part by the State, but more, I should have thought, as general unemployment throughout the community is catered for, by certain indirect controls, like the reduction of taxation, like the reduction of the Bank Rate, like the freeing of hire purchase restrictions and all the other economic devices which we have now learnt to use for the purpose of promoting full employment. I would not exclude the question of the special derating of areas suffering from local unemployment, but I will come back to that before I sit down.
Subsidies, I think, are always a dangerous weapon to use in this regard. There is an excuse for using a subsidy short-term for bringing about a social or industrial change—to initiate an industrial reaction—but withdrawing the subsidy afterwards. Long-term subsidies, as we on this side of the House well know—for instance, for general housing—can unbalance the economy. They can distort prices and they can produce unfairness between one section of the community and another. Of course, if they are continued to the end, the State gets into a position where it pursues subsidies as such and embarks on a will-o'-the-wisp adventure which is never ending. If we produce a subsidy which helps an industry to survive and 98 become live and prosperous, we see at once another industry or service which is in a worse situation, and immediately the State has to go chasing after that with the taxpayers' money to bring it into an equal position. The process is never ending once we decide that permanent subsidies are necessary for the community.
This Bill rides roughshod, I believe, over those principles which I have tried to enunciate. The taxpayers' money is required to be given to Mr. A, a business executive or industrialist, in order that he shall come with his plant, his equipment and his employees to town X. We have also the threat of compulsory purchase, to which, I think, insufficient attention has been paid by my right hon. Friend, but which we must deal with in Committee. Is it right for somebody's industry in a particular town—where that industry may be lying fallow for a particular purpose, uncompetitive for the moment but with prospects in two or three years—is it right that the Board of Trade should waltz into that situation—it may be a dingy old factory not employing many people—and take it over by compulsory purchase and give it to someone else who comes along and who may be closely associated with or a friend of the Ministry—[Laughter.]—oh, yes, a great friend, an industrialist with prospect of advancement and final elevation to somewhere not too far away from here?
Seasonal unemployment is a danger which has been referred to. My hon. Friends the Members for Cornwall, North (Mr. Scott-Hopkins) and Lowestoft (Mr. Prior) spoke admirably in their maiden speeches and I wish to refer in passing to the point they made. I do not criticise their valuable contributions in any way, and we hope that we shall hear from them repeatedly. But they dwelt with a kind of fascination on the prospect of seaside towns becoming slowly, creepingly industrial areas by the process of saying that in winter there is unemployment, therefore industry must be brought in, but in summer it becomes a seaside town and has to import a population in order to discharge the duties of the summer entertainment and the duties of the winter employment as well. One has to get to the size of Brighton before one can be certain that 99 such a town can provide industry and entertainment at the same time. Is that what is wanted all round our shores?
But let us return to town X to which this Bill is to be applied. I have not the great advantage and honour, as so many hon. Members opposite have, to represent a great industrial city. I have not been able to witness, as they have, at close hand the terrible events of the past and, to some extent, the serious unemployment problem at the present time. Nevertheless, having regard to what we are doing for individual social justice, do not let us magnify the problems out of all proportion and make it seem to be what it was twenty or thirty years ago. I have admitted that local unemployment is a social disease and something must be done to cure it.
Perhaps the future of their towns is not what hon. Members imagine it should be. Perhaps it will be entirely wrong to try to put a town back again in the old framework as a wholly industrial area. Disraeli's two worlds, I thought, was coming to an end. Do we want to use the taxpayers' money in order to stuff new industries into these demarcated areas, or do we want today, in a more enlightened and open age, to redistribute industry from those towns, to take the old industrial heart out of the town and put some playing fields, some open spaces, some beauty and gaiety in its place? Do we want to use the State's money—[Interruption.] Why should the workers continue to reside in the place where they now live and not be encouraged to move. Many thousands have cars today. Why should they not motor twenty or thirty miles from their town to areas where they can employ their skills?
We have to think in these terms. I think the idea that we must exclusively maintain this sharp distinction of great manufacturing cities and derelict countrysides, to which my hon. Friends have referred, is quite wrong in this day and age. If it is not wrong, why are we doing what we are doing in the new towns and decanting populations from great industrial cities?
Then let us consider Mr. A. and his colleagues. Why should we put the taxpayers' money into the pocket of Mr. A. in order that he should go to a town and 100 start up an industry? Suppose he does start it up, does it successfully and gets to the stage where the town is fully employed again. According to this Bill, he is still to go on receiving the taxpayers' money. In other words, his process is to be permanently subsidised and his neighbour's process in another town, which may be exactly, the same in that trade, is not subsidised. It may not have been significant so far on £3 million a year, but people are asking that a great deal of money should now be spent in this way. We have to look at this situation with amounts of £20 million or £30 million, or even £50 million a year in mind. Is it right that taxpayers' money should be used to subsidise a particular industry as against others?
In my view, the Welfare State was made for the individual. The individual has a right, a natural right, to be alive and well, to praise God, and be free, and it is the duty of the State to assist him in the enjoyment of that right. But an industry, a service, a business, has no natural rights at all. It is not the duty to maintain any given level of industrial maintain any given level of industrial activity.
§ Viscount Hinchingbrooke
I shall come to that in a moment. Businesses are mechanical associations of persons. They have no natural rights to be large or small, to be prosperous or derelict, to exist or not to exist. It is not the function of the State—except in very well-defined fields—to come to their aid. Defence-strategy is one, and, if we bring agriculture into the question of defence strategy, that is another. Fundamental scientific research is a third.
From now on, with these enormous sums which the State is spending and this very high level of taxation everyone is suffering from, we have to look every time at the extension of the State's activity from the individual to the business concern. The State has got to prove its right to extend its patronage. I should have thought that now, so many years after the war, with nearly ten years of Conservative Government, and with the prospect of five more, we should be instituting what in previous debates I have described as a recessional of State power, not in order to reproduce any of 101 the social evils of the past, but as a means of elevating the general idea of individual freedom. I should have expected less State paternalism, less Government expenditure and less taxation.
On the subject of taxation, can we not conceive that some of these industries which are deemed to have suffered to the extent of unemployment arising in the special areas, had there not been the very high taxation of the last ten or fifteen years, would have installed more up-to-date plant, than they had done, would be more on their toes and more competitive with some of the industries and services overseas? I give the House one figure.
United Kingdom taxes on industry are annually running at £900 million to £1,000 million and fixed capital formation on land, buildings, plant, machinery and the like is running at about £1,000 million a year. That shows the source to which industry could look if only the Government would turn their attention to substantial reductions in taxation on industry and letting these industries re-equip themselves and get independent and competitive. That is needed much more than grabbing more and more money from industry and individuals year after year and pouring it out from State resources to special purposes, never clearly defined.
We need a fresh study of these processes and a fresh study of the question of moving workers to a place where there is work, instead of moving industry to where the workers happen to be. If workers were moved in an acceptable way they would enjoy that process far more than having industry brought to their doorstep. We should turn our attention to a special measure of derating for particular areas suffering from chronic unemployment. At present, industry is de-rated to the extent of 50 per cent. Why should we not say that if industry comes to a town where there is over-full employment it will be rated 100 per cent., but if it goes to a town where there is chronic unemployment it will be de-rated altogether with graduations between the scales. I would much rather subsidise an area where all the industries could benefit than subsidise selected industries because they have gone there at Government behest.
In conclusion, I am afraid that I must say that before some of these questions 102 can be answered we need something even more fundamental from the Government at the beginning of this Parliament. We must have a major speech from the Prime Minister to state whether the Government is in favour of protection or free trade. We all understand protection from the point of view of the imposition of tariffs and the bolstering up of the State revenue from the proceeds of those tariffs. We all understand free trade from the point of view of the efficiency which it produces at the cost of causing a rapid industrial decline.
What I do not understand is the extension of free trade areas and the indulging in free trade when the consequences of it are sealed off by subsidies and a vast rise in the Civil Estimates. The end of that process must be that the State gets a fundamental grip on every industry and service in the country.
Lord Baldwin once described the lot of the harlot through the ages as "power without responsibility". The moment the electorate begins to see that the State has that power over the industrial processes of the country, it will ask for the responsibility to be taken as well. Then we shall have the direct purchase of shares in industry in return for the subsidies which are being paid, with take-over bids by the Government and remorseless nationalisation. Let my hon. and right hon. Friends not prepare the way for this day by the acts which they are now perpetrating.
§ 7.12 p.m.
§ Mr. Dan Jones (Burnley)
For some twenty years I have been a trade union official, and during that time I have risen to speak on many hundreds of occasions, nearly always with a measure of confidence. This evening my feelings in addressing the House for the first time are more of diffidence than of confidence. I mean that quite sincerely as a tribute to the House. After all, there can hardly be a more revered establishment in the country. To a marked degree the experience is awe-inspiring.
Nevertheless, I have two points to make, for as a full-time trade union official I have been the means of inducing industrialists from the Midlands and London to move into certain so-called Development Areas. My experience 103 has been that when we get the factory, the plant and the workers—even the key workers—one substantial problem remains. We have found this problem to a marked degree insoluble. It is what about higher management? We must recognise that these people are an integral part of industry. If the economics are to be properly balanced, we must cater for them, and it is not very easy to do so. As far as I can see, there is nothing in the Bill which offers more inducement to this class of worker.
I do not want to hammer the point too hard, and I will turn to the second point I wish to make—the employers who are by no means as scrupulous in their relationship with the workpeople as they should be. I have in my possession evidence which purports to show that employers in Lancashire are telling people there, "Unless you conform to a pattern laid down by us, we will remove our factory back to the Midlands." The pattern to which they refer is unacceptable not merely to shop stewards but to the accredited trade union officials. That kind of industrial practice undermines the whole structure of the Bill. I therefore feel that much more than gentle persuasion may be necessary if the Bill is to be a success.
I am among the class of people mentioned by my right hon. Friend the Member for Llanelly (Mr. J. Griffiths), for I was driven by poverty to seek industrial rehabilitation in some other part of the country. I make no other reference to my own experience, beyond saying that at that time there was a family of three—my wife, my son, Emlyn, and I. My son Emlyn today is an honours graduate of one of the finest universities in the country. His brother, Michael, is following him.
Many a time I have asked myself this question: would these lads have had the opportunity to make use of their ability had I remained an unemployed person? It occurs to me very forcibly that in the pockets of unemployment which exist in this country there must be quite a number of Emlyns and Michaels, even today, when there is a measurable degree of unemployment in our midst but the country is screaming for technicians and technologists. I do not think that we can afford to leave these people unable 104 to make use of whatever talent they possess.
I return for a moment to my own constituency, in which the employers' observation has been made to which I have just referred. At the moment over 800 people are registered as unemployed in my constituency and by March of next year 24 mills, affecting 2,200 people, will be closed down. We could easily be in a very similar position in Burnley to the dismal position outlined by my hon. Friend the Member for Nelson and Colne (Mr. S. Silverman). I feel very strongly that something more than simple persuasion will be necessary, notwithstanding the views expressed by the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke).
I am certain that the Bill is of far greater import than is suggested merely by figures. May I be pardoned for saying that the greatest indictment of the years which I spent as an unemployed person was not that of trying to exist on 28s. a week. I do not think that that is the greatest indictment of permitting a man to be unemployed. In my opinion, the greatest indictment is that day follows day, week follows week, month follows month, and sometimes year follows year, during which society has no room for you. That is one of the greatest indictments.
My wife assisted me to canvass during the recent election in Burnley. In the evenings, while we were enjoying a cup of tea and exchanging our greetings, she often said, "Some of the people in Burnley are terribly worried about this problem." My wife could well understand it, because the first four years of her married life were spent in similar circumstances. She told me that these people are unable to sleep at night because they know that their mills will have to be closed. It is only when we begin to see the human aspect that we see the problem as it should be seen.
In a maiden speech one is commended to be non-controversial and brief. One day, perhaps, I shall have the opportunity to reply to the noble Lord the Member for Dorset, South. Before I conclude, may I say that I regard the opportunity of this expression as a privilege. I turn to you, Mr. Speaker, and thank you for allowing me to make it.
§ 7.20 p.m.
§ Mr. Raymond Gower (Barry)
It is a privilege to have the opportunity to congratulate yet another recently elected Member of the House, the hon. Member for Burnley (Mr. D. Jones), on having so successfully negotiated his maiden speech. These speeches are coming off the line at a rather tremendous rate tonight. I am sure that many hon. Members have noted that most of the speakers who are overcoming this hurdle tonight share one qualification, in that they have remarkable self-confidence. They may be nervous, but they do not show it. Although the hon. Member for Burnley may have been very nervous, he certainly gave no appearance of nervousness. When he has the opportunity to be controversial, his natural self-confidence will assert itself even more markedly than tonight. I am pleased also that you, Mr. Speaker, have given me this opportunity, because the hon. Gentleman contested my constituency against me in 1955 and I have good memories of that contest.
The Bill deserves a warmer welcome than some hon. Members opposite have been prepared to give it, certainly a much warmer welcome than the right hon. Member for Llanelly (Mr. J. Griffiths) was prepared to give it. There are those who, like my hon. Friend the noble Lord, take a particular view of this sort of legislation, but we can say that for the most part the Bill will commend itself in principle to most hon. Members on both sides of the House. We have in recent years had very few people in public life in any political party who have not felt that it was a particular duty of government to do everything possible to sustain the highest level of employment. There have been very few people in any party in this country who have not deemed it the proper duty of Governments to take special powers to accomplish that object.
We have gone a long way indeed from laissez-faire. We have proceeded a very long way from the doctrines of those who believe that natural economic courses must have their free flow. Most of us today believe that there are social and humanitarian considerations which sometimes outweigh the purely economic ones.
106 Since I have had the honour of being a Member of the House I have known very few Members who have held a severely different view. One was the late Sir Rhys Hopkin Morris, former Deputy-Chairman of Ways and Means. He was a man of great humanity and ability. He held the view that anything which tended to distort the economy, though introduced with the best of objects, might in the long run do more harm to the country which introduced it than the local good it might accomplish in the first place. I well remember how he described it to me on one occasion by saying, "If we took steps to thwart the geographical and economic causes which created the great port of Southampton, by creating a rival port somewhere else though for good social reasons, we might in the long run do much more harm to Britain than any good we might do temporarily". That was his view.
That has not been the view of most hon. Members on either side in the years since the war or even before the war. As my right hon. Friend the President of the Board of Trade said, the Bill is the latest in a long and notable succession of Measures designed for the relief of unemployment having a special impact in particular areas of this country. Some of these Measures are set out in the Third Schedule to the Bill, but this sort of legislation has an even longer history. As hon. Members will recall, it goes back to the days before the last war.
If the present Bill differs considerably from its predecessors, if its emphasis is in a slightly different direction, it is, first, because our thinking on these matters has been conditioned by our experience and previous attempts to deal with them and, secondly, because the conditions now applying are somewhat different from the conditions which applied when we made our first, and perhaps experimental, step to deal with these problems.
For example, there was the Depressed Areas (Development and Improvement) Bill, later enacted, referred to by my right hon. Friend and by the right hon. Member for Llanelly. That Bill was introduced for Second Reading in 1934 by the late Mr. Oliver Stanley, as Minister of Labour. Some hon. Members will recall that that was the Bill which planned to set up commissioners 107 for the "special areas". On Second Reading, Mr. Oliver Stanley said:It was felt that there were certain things which could be done in these areas which would be better done by independent commissioners of this kind than by a Government Department, with all the machinery through which proposals have to go when a Government Department deals with them."—[OFFICIAL REPORT, 3rd December, 1934; Vol. 295, c. 1252.]If he were speaking today the late Mr. Oliver Stanley might not have used those terms or might not have said them with that assurance, because the present Bill gives very considerable powers to Ministers, certainly to my right hon. Friend. I agree with what has been said on both sides, that it remains to be seen how those powers will be exercised and how the machinery of the Bill will work. It is interesting to note that the right hon. Member for Ebbw Vale (Mr. Bevan) took part in the first debate in 1934; and that my right hon. Friend the Prime Minister was at that time leader of a group of Conservative Members who took a rather distinctive and urgent view of the problem of unemployment.
I do not believe that we should feel that what was then done in the light of the knowledge then available was wholly misconceived. Notable and valuable work was carried out in the pre-war years. Indeed, in South Wales, in which my constituency is situated, many can recall how valuable work was carried out by the late Viscount Portal of Laverstoke, who was one of the commissioners for the "special areas", and how the foundations of the great Treforest Trading Estate were then established.
That was the position in other parts of the country too. Even before the war the extent of pre-1939 achievement was borne out by the commissioners' "Special Report" published in May, 1939. That states that in the Team Valley 106 factories had already been completed, nine were under construction and employment had already been found for 2,500 people. At Treforest 55 factories had already been completed, 17 were under construction and jobs had been provided for 1,868. At Hillington in Glasgow 121 factories had been completed, 32 were under construction and 1,500 jobs had been provided.
108 Hon. Gentlemen say tonight that those figures were fairly small, but they were certainly not contemptible or insignificant. Out of those seeds have grown some very healthy plants. Prior to 1939 the original Act was modified and altered and powers were incorporated for the granting of loans. Then, as was said by the right hon. Gentleman, came the landmark of the 1945 Act. The right hon. Gentleman stressed the part played by Mr. Dalton, but he will agree that the Act was passed by the Coalition Government, a fact which is of some importance.
§ Mr. Gower
It was a Coalition Government Act. It was passed in the lifetime of the Coalition Government. The hon. Member can easily check that. To that extent, it is important to reflect that all parties represented here made their contribution to that work.
That Measure set up the Development Areas in the North-East, in West Cumberland and in South Wales, and, as the hon. Member for Sowerby (Mr. Houghton) has pointed out, other areas have been added subsequently. The Distribution of Industry Act, 1950, which was passed by the Government of Mr. Attlee, as he then was, was complementary to the 1945 Act. Most of the work done in the lifetime of the Labour Government was done under the powers of the Coalition Government's legislation.
As I see it, the present Bill has different, but wider and more flexible powers than had most of the legislation that it will supersede. Hon. Members will, I think, particularly welcome the wording of Clause 1 (2), which fairly generously says:The localities referred to in the foregoing subsection are any locality in Great Britain in which in the opinion of the Board of Trade … a high rate of unemployment exists or is imminent, and is likely to persist (whether seasonally or generally).There are two valuable additions. The imminence of unemployment is to be sufficient for action to be taken, and seasonal unemployment in certain places is included.
Clause 1 (4) extends the possible localities even more, and this, too, takes us far from the rather precise and rigid description of special or Development Areas. The hon. Gentleman the Member for Nelson and Colne (Mr. S. Silverman) 109 complained about this, but I feel that the House should welcome it. How many times in this Chamber have we heard hon. Members on both sides complaining that a certain town or area did not qualify for the benefits given to Development Areas? How often have we heard complaints at Question Time or in debate about the exclusion of a certain town from the benefits that have gone to towns and other places in special or Development Areas?
From the wording of this part of the Bill it seems clear that in some cases it will be possible for valuable anticipatory action to be taken a considerable time before the condition that is tending to produce unemployment becomes serious. That is a great advance over all previous legislation. I hope that my hon. Friend the Parliamentary Secretary-can confirm that I have not wrongly described the effect of this part of the Bill.
Clause 1 (6), which limits to seven years the operation of the new powers, has been criticised by the right hon. Member for Llanelly, but I certainly think that such a limitation is reasonable, and likely to be beneficial. Experience has shown that from time to time we need to reconsider our treatment of this kind of problem, and it seems probable, too, that when the seven years have elapsed it will be advantageous for the Parliament of that time to look again at the provisions of this Bill in the light of the previous experience. I cannot believe that the right hon. Gentleman's criticism was valid. This limitation of seven years is of great benefit, as it will give Parliament another opportunity to reconsider its treatment of this difficulty within a reasonable period of seven years.
I feel that both sides of the House will support the provisions of Clause 2 (c), and the new terms under which development certificates are to be issued under Clause 19. This is a real attempt to deal with difficulties that have arisen in the administration of the earlier Acts. In South Wales we have had a local and topical example of one of these difficulties. For many years, the firm of Johnsen and Jorgensen have provided excellent employment on the Treforest Trading Estate, near Cardiff. I understand that in recent years it has 110 employed between 200 and 300 people, many of whom are my constituents. That firm has been praised in all quarters as a first-class employer, yet it now proposes, for reasons that seem sound to it, to move from South Wales, where it is badly needed, to Charlton, where, I am told, there are thousands of vacant jobs and not nearly enough people to fill them.
I trust that my right hon. Friends the President of the Board of Trade and the Minister of Labour will do everything they possibly can to get this company to reconsider its decision to move. Certainly the proposed move seems contrary to present Government policy—
§ Mr. Gower
The right hon. Gentleman says "stop it," but my point is that, in the absence of very extraordinary circumstances, the new provision in this Bill will probably render that kind of thing less likely to happen in future. Again, perhaps my hon. Friend can tell me whether I am right or wrong. I certainly hope that it is the fact that the conditions that may be imposed by the Board of Trade may render less likely this sort of movement.
A second kind of problem arose not very long ago, when a fairly large company sought a development certificate for projected development in a prosperous area. The application was turned down. The company was advised that a development certificate could be granted only if it was prepared to move to an area approved by the Board of Trade for such expensive factory development at the present time. I believe that, in the event, the company was able to get round that restriction simply by acquiring an existing factory and changing its user. This Measure will deal with such a situation, I think that, in future, by Clause 19, a change of user will itself require an industrial development certificate. Again, I hope to be told whether or not that is correct.
Provisions giving powers to act in cases of overspill localities and travel-to-work localities will be particularly valuable in present-day circumstances, when there has been such an increase in the number of new housing estates and in the number of people able to travel to and from their work by bus or motor 111 car. I am glad, too, that my right hon. Friend utterly rejected the idea of direction of factories to particular parts of the country. The hon. Member for Sowerby mentioned this, but I was surprised that when my right hon. Friend said that he could not accept the idea of direction some hon. Members opposite appeared to take a different view.
In that connection I can give two examples that have been brought to my notice recently of factories, associated with American companies, that have come to this country. In one case of which I have personal knowledge, the American company also has an associated factory in France. It is fairly obvious that if we were to start directing companies like that they would concentrate on building up their interests in France or elsewhere and would not be so keen on building up here. Again, I understand that in Scotland the development corporation—or "Scottish Council" as I think it is called—is doing its best to get new industry from the United State and overseas to open new factories in Scotland. Obviously, if we try to use powers of direction with such firms from overseas, we shall probably prevent them from coming to this country altogether.
Clause 8 sets up separate industrial estates management corporations. This provision calls for a little more explanation than we have yet had. There is a good deal of concern among employees of these estate companies about their future. I hope that my hon. Friend will be able to remove that concern. They would like to know, and I am sure the whole House would like to know, whether those people who have served so loyally the estate companies, which have made such a great contribution to the administration of previous legislation, are fully protected now that we are to have in place of the estate companies three corporations for England, Scotland and Wales.
Finally, I think that the Bill is in many ways a better Bill than those which preceded it because it is a more flexible weapon for dealing with present conditions. It is fairly obvious that the conditions that obtained when we formulated the idea of the rather rigidly contrived special areas—those conditions that obtained at the end of the last war when 112 it was apparent that there would be a great expansion of civil industry and we wanted it directed to the special areas—do not apply today.
With the conditions which obtain today it must be apparent to many hon. Members that in many cases there is serious unemployment in quite small areas. The hon. Gentleman the Member for Caernarvon (Mr. G. Roberts) will appreciate that in North Wales there is one part of the country not situated in a Development Area which can now enjoy the benefits of this Bill, if it is enacted. This is not only a more flexible Bill but it contains powers which will enable action to be taken more promptly. While I agree with several hon. Members that it remains to be seen how the Bill will be administered, I think that it represents a piece of legislation which should attract the maximum support of hon. Members on both sides of the House, and I hope that it will have an unopposed Second Reading.
§ 7.43 p.m.
§ Mr. Frederick Peart (Workington)
The hon. Member for Barry (Mr. Gower) has said that the Bill deserves warm support. I am afraid that, representing the constituency that I do, I cannot give it my support, and I propose to give my reasons.
I was very glad that the hon. Member for Dorset, South (Viscount Hinchingbrooke), who is not now in the Chamber, also expressed the authentic spirit of British Toryism in his speech. I hope that the hon. Member for Hexham (Mr. Speir) and other hon. Members who have come into the House and who spoke these views from their platforms will support him in his criticism of the Government. I think that the hon. Member must accept that many Tories, who in their speeches on platforms expressed the views of the noble Lord have, now that they are in the House changed their views. I believe the right hon. Gentlemen on the Front Bench opposite have changed their views. I think it is true that the President of the Board of Trade is quite a different Conservative from the noble Lord, and there will be inevitably this conflict in the Tory Party as to what part the State plays. It is a real argument. After all, why not?
113 I oppose the Bill, and I would wish to express much stronger opposition than has been expressed by many of my hon. Friends. I believe it to be a bad Bill. I am certain that the President of the Board of Trade had very little to do with its shaping, and that the noble Lord was right when he said that it was foisted on him and no doubt prepared by certain backroom boys, who work in all parties and who influence government too much at the present time.
I believe it to be a bad Bill, and very briefly I will give my reasons why. First let us take the question of powers. We have heard much from the hon. Member for Barry about the new powers and how flexible the new legislation is.
The Explanatory Memorandum states thatThe Bill repeals the Distribution of Industry Act, 1945 to 1958, and replaces their provisions by increased powers for providing employment in any locality. …I have looked carefully at the Bill and I do not see any increased powers affecting my own area.[Interruption.] If the hon. Member for Sunderland, South (Mr. P. Williams) reads the official documents and the Report of the Select Committee on Estimates, I think he will agree that it was a very interesting Committee. I think he was connected with it in the sense that he had views on it. The powers are there laid down. They are included under various headings. I will not go into them in detail. They extend the powers of the Board of Trade to acquire land, compulsorily, if necessary, and give power to build factories. Under another heading are Treasury loans, money that is required for industrialists; the granting of financial aid to local authorities for the improvement of the amenities in the areas; and industrial development certificates.
§ Mr. Rupert Speir (Hexham)
The powers are all there only if a high level of unemployment exists. The Board of Trade have no power or right under present legislation to anticipate unemployment in any given area.
§ Mr. Peart
I am arguing that the powers are there in legislation and, even with the new Act of 1958 and in the circular sent out by the Parliamentary Secretary entitled, "Industry on the Move," all the powers are there to 114 provide the necessary State initiative and State help.
This Bill is merely a measure consolidating the existing legislation and is really applying the powers to the whole of the country to individual areas and places outside the Development Areas and outside the places listed in the Parliamentary Secretary's Memorandum, "Industry on the Move", which he submitted and put out from his Department.
I am arguing that the Bill destroys the old conception of the Development Area. I believe that that is a bad thing. Certainly, we should have powers to deal with localities and individual areas outside the existing Development Areas—I am all for having those powers—but this Bill will end the whole conception of a Development Area where a whole unit should be treated as an integrated whole. That is the weakness of the Bill, and that is why I and my hon. Friend the Member for Whitehaven (Mr. Symonds), representing the Development Area of West Cumberland, feel very strongly about the Bill.
The powers are there and we have complained during the last few years that the Government have not used the powers that are there. Time and time again we have made representations about this. The Bill will in no way improve the position in West Cumberland. I believe that it can be harmful to West Cumberland because it will destroy the approach which will regard the area as an integrated whole. It is how the powers are used that will count. May I remind the hon. Member for Barry, who referred to the Act of 1945, that while I agree that it was a Coalition Measure, I think the hon. Member will know the history of that Measure. It was due to the initiative and enthusiasm of a former colleague of ours, Hugh Dalton, who was then a Coalition Minister. Indeed, during the war he threatened to resign from the Government because they did not look ahead into the post-war period and regard the distribution of industry seriously.
§ Mr. Paul Williams (Sunderland, South)
If the hon. Member harks back that far, surely he will hark back to the Coalition White Paper on employment policy, which was not drawn up by Dr. Dalton.
§ Mr. Peart
That is true, but the initiative for the Act of Parliament, then a Bill, was due to Hugh Dalton. What was more important was that in his first Budget as Chancellor of the Exchequer Hugh Dalton allocated £10 million for schemes in Development Areas. In other words, what really mattered to us in West Cumberland and, indeed, to the other Development Areas, was how the powers were used. That is what I am concerned with today.
In my area, we have had considerable success. Now, of course, we have problems, because we see the contraction of the coal industry. In my constituency, two collieries have recently closed, creating redundancies. We are isolated from the rest of the country. We have problems of transport. I agree with an hon. Member opposite who said that transport is a major problem in the provision of employment and with another hon. Member who made an excellent maiden speech dealing with the problems of East Anglia. For us in West Cumberland it is a real problem. If we are to tackle our serious unemployment problem, we must improve our communications.
My hon. Friend the Member for Whitehaven (Mr. Symonds), myself and others have been pressing these matters over and over again. That was why we resisted a proposal to close down a main railway line in the area, running right through the Development Area, from Workington to Keswick, Penrith and further on. Such a policy would be foolish. I agree, therefore, with the noble Lord the Member for Dorset, South that when we consider employment, even in Development Areas, we must think of national policy. Although there may be powers in the Bill, without a national policy for transport that will regard my area from the viewpoint not of profit but of the social needs of the area, we will never have an expanding economy in West Cumberland. Therefore, we are concerned about the Bill.
I am concerned for this reason, too. We are now to have three corporations, one each for Wales, Scotland and England. They are to be responsible for policy—development policy. I am afraid that this kind of organisation will become too large and too bureaucratic. I would have thought that many hon. Members 116 opposite would make strong speeches against this kind of thing.
The Government are creating for England a new corporation which is to have certain powers. Through the creation of these corporations, they are destroying local organisations which have been successful. That will happen in my area. There is to be a large corporation for England, but, as stated in the Second Schedule to the Bill, the West Cumberland Industrial Development Company, which has been successful, is to cease to exist. I am worried about this. The West Cumberland Industrial Development Company has owed its success to the initiative, energy and faith of Lord Adams, who is known to us in Cumberland as Jack Adams. Through his energy and enthusiasm, we have had a success story. Now the unit is to be destroyed. That is the purpose of the Bill.
The West Cumberland Industrial Development Company worked with voluntary organisations. We have in our county the Cumberland Development Council, of which Lord Adams was Secretary and which he helped. All that is now to go. The Government, who represent a party which preaches against bigness so much on platform, on radio and on television, are now destroying something in my area which was successful.
Many hon. Members opposite served on the two Select Committees which dealt with Development Area policy. They have condemned this type of approach that the Government are now making. They have argued over and over again in relation to Development Areas that administration should be left to local bodies, like the West Cumberland Industrial Development Company. Why are the voices of those hon. Members now quiet? I hope that they will protest and support us in our criticism. Those hon. Members opposite who remain quiet and acquiesce in the policy of the President of the Board of Trade and of the Cabinet will be destroying something in Cumberland which has been effective and has done good work. Instead, we are to have a large corporation for the whole of England. The hon. Member for Hexham should be ashamed of supporting the Government who are doing this. I am certain, however, that the hon. Member for Sunderland, South agrees with me 117 and I would like to know what other hon. Members opposite think.
There is another question which has not yet been raised on the Bill. What about Parliamentary accountability? It is said that we are to have annual Estimates and we will have an account of the work of these corporations. No doubt, we will have a nice friendly annual debate once a year, but what about the day-to-day work of the corporations'? Are we to have the same rules of procedure which apply now to the National Coal Board and the other public corporations?
I warn hon. Members opposite that whilst we have defended the creation of those great public concerns and nationalised industries, many of us believe that it is right and proper now, at this stage, to have Parliamentary criticism and to enable Questions to be asked of Ministers. I should like to know from the President of the Board of Trade or the Minister of Labour, whichever replies to the debate, whether we will now be able to ask day-to-day Questions about matters affecting the existing Development Areas. I know that this will be a matter for consultation, but will we be prevented by Parliamentary rules from asking day-to-day Questions about employment conditions in our own areas, or will the President of the Board of Trade come along to the House and say, "I have no responsibility now. This will be a matter for the corporation."? This is the real issue and I would like to know the answer.
We are not yet certain what the President of the Board of Trade will do in relation to the areas which are to be listed. We are giving the Minister powers, but we do not know for which areas they are to be used. The President is being given a blank cheque. I hope that now that he is to have these powers, he will use them wisely. Will I be able to ask Questions affecting my constituents in relation to the work of the corporation? This is a real issue affecting not only Parliament, but the checking and the criticism of the policy which may be pursued by the corporation under the President of the Board of Trade.
Above all, the Bill is bad because the problem could have been tackled differently. There could have been a 118 re-examination of the existing Development Areas. I know that within many of these areas the problem is how industry should be better distributed, even within the Development Areas themselves. That has not been our problem in West Cumberland. We have had a success story in that sense, but I know that it is a problem in South Wales and even in North-East England, an area which I know very well. We could still have had the powers which exist under present legislation and the concept of a Development Area where services and industry can be integrated into the life of the whole community, and there would be that broad approach. For the other area, there could have been a smaller corporation which could have had the self-same powers which exist under present legislation.
That is how I would have tackled the problem. As I have said, I believe the Bill to be wrong. It is wrong also because it ends the concept of the distribution of industry for defence reasons and also for social and economic reasons. That is why I disagree fundamentally with the noble Lord. I believe that the State should intervene and that there should be national policy which should seek not only to help West Cumberland, South Wales, Durham and Scotland, but should ensure that there is full employment.
It is true that matters about protection and free trade are vital to national policy. I accept that, but, above all, national policy should aim at a better redistribution of industry. London is becoming too big and the Midlands too congested. It is right, therefore, for defence, social and economic reasons to aim at a policy behind the Bill. There is no broad policy behind the Government in relation to this Measure. It is a bad Measure. As I have said, it creates bureaucracy and destroys initiative in areas like my own.
§ 8.2 p.m.
§ Mr. Stanley McMaster (Belfast, East)
I should like to say how glad I am to have caught your eye, Mr. Speaker, in order to have the opportunity of taking part in this important debate. I should like to welcome the Bill on behalf not only of myself but of other Ulster Unionist Members in the House. It extends to Great Britain measures 119 similar to ones which already exist in Northern Ireland. The Northern Ireland Government have adopted similar inducements to industries aimed at encouraging new industry to settle voluntarily and happily in areas where there is high unemployment which, when they have settled, can expand and prosper and, therefore, not only bring more employment to the areas, but better trade and a higher standard of living to persons already living in and carrying on businesses in such areas.
We in Northern Ireland have a very high figure of unemployment. The difficulties in Ulster arise from an over-dependence on heavy capital industries. Large employers like those found in the shipbuilding and aircraft industries employ a very great percentage of the working population in Belfast and Ulster. The great need in Ulster is experienced not only in Ulster but in other places of unemployment in this country. It is a need for diversification. There is a need—and here I disagree with the remarks of the hon. Member for Workington (Mr. Peart)—to anticipate future employment trends. Speaking for my own constituency, changing demands in the aircraft and shipbuilding industries, caused, perhaps, by a slump in freight rates or by a fall in world trade, which causes ships to be laid up and orders for ships to be cancelled, can cause very great unemployment in an area like my own constituency. I believe that it is the primary task of any Government to ensure that in areas like Northern Ireland there is ample alternative employment available to meet the needs of those likely to be affected by such changes in demand.
I do not need to stress the very serious social problem caused by heavy unemployment. We in Belfast experienced that between the two wars, and no one wants to see it repeated. The present figure of unemployment in Northern Ireland, 7 per cent.—nearly 8 per cent. for men and 5½ per cent. for women—is far too high and is very much above the national average, which is under 2 per cent. Translated into more understandable terms, it means that in Northern Ireland more than 33,000 men and women out of a total of 470,000 insured population cannot find work to support 120 themselves, their families and dependants. It has been estimated that one new industry a year must come to Ulster merely to keep pace with the rise in the working population. We have a rise in working population of more than 2,000 per annum.
I should like to develop our particular problems in Northern Ireland more fully, but I realise that other hon. Members wish to speak. I should therefore like to pay some attention to the Bill. I should like to ask the Board of Trade for an assurance that, in exercising its discretion when granting development certificates under Section 14 (4) of the Town and Country Planning Act, 1947, which, as hon. Members will see, has been extended by the Bill and modified by Clauses 17 and 18 of the Bill, it will consider not only the need to provide appropriate employment in particular areas throughout Scotland, England and Wales, but also the need to provide more employment in Northern Ireland.
We in Northern Ireland have been heartened by the assurances already given by Her Majesty's Ministers in this House. During the last debate on unemployment on 17th December last year, the President of the Board of Trade said:The Northern Ireland Government are responsible for employment in Ulster, but this House has always felt that it had a special duty to do what it could to help them with their very intractable problem.Later, he said:The administrative pattern for Northern Ireland is the Northern Ireland Government in charged, helped by the Development Council, under the chairmanship of Lord Chandos, and, in Great Britain, the Board of Trade doing all it can to bring to the notice of firms who give us a reasonable hope that they might move the advantages of going to Northern Ireland, and, in this way, backing up the Northern Ireland Government."—[OFFICIAL REPORT, 17th December, 1958; Vol. 596, c. 1157–8.]I should like to give another short quotation from a speech made the following day by the Joint Under-Secretary of State for the Home Department. He said, in winding up an Adjournment debate on unemployment:United Kingdom Departments do all they can to help the Departments of the Government of Northern Ireland in their efforts to encourage the development of industry in Northern Ireland.121 He also said:The efforts of the Northern Ireland Government to attract and further develop industry in the way that I have mentioned are supplemented by the work of the Board of Trade in steering industry to Northern Ireland by suggesting to firms with new development projects that, if possible, they should go where there is unemployment. … As a result of the Board of Trade's influence, together with the efforts of the Ministry of Commerce of Northern Ireland and the Northern Ireland Development Council, under Lord Chandos, every firm with a new project which might conceivably be developed in Ulster is made aware of the advantages which Ulster can offer. The Government of Northern Ireland have shown themselves willing to give every encouragement and assistance to those firms who are willing to help themselves, and I can assure my hon. Friend that Her Majesty's Government will continue to give most serious consideration to any proposal which the Government of Northern Ireland may make to assist the further development of industry in that loyal part of the United Kingdom."—[OFFICIAL REPORT, 18th December, 1958: Vol. 597, c. 1326–7.]Also, during the debate on the Gracious Speech, we in Ulster welcomed the encouraging statements made on the opening and closing days by the Prime Minister and the Secretary of State for the Home Department. My right hon. Friends made it clear to the House that the Government, in their strategic planning for the economy of the whole country, would not forget the particular problem, the severe problem of unemployment, which we have in Northern Ireland. Therefore, I am confident that in his reply to the debate tonight my hon. Friend the Parliamentary Secretary will be able to give us an assurance that the need for providing employment in Northern Ireland will be taken into account by the Board of Trade in considering applications for industrial development certificates in accordance with the provisions of Clause 18 of this Bill.
§ 8.12 p.m.
§ Mr. Cledwyn Hughes (Anglesey)
The hon. Member for Belfast, East (Mr. McMaster) has spoken with great feeling about the unemployment problem of Northern Ireland. I am certain that hon. Members on all sides of the House will sympathise with him. Northern Ireland is not covered by the Bill we are discussing and the six counties of Northern Ireland are catered for in other ways. They are governed by their own Parliament and they receive substantial benefits 122 —more substantial than are contained in this Bill. If time allows, I will refer to them later on in the course of my speech.
§ Mr. McMaster
If the hon. Gentleman will allow me to interrupt, that was precisely why I intervened in the debate. I realised that the Bill does not apply to Northern Ireland, which was why I called for an assurance that in applying Clause 18 the Board of Trade would consider our employment problem in Northern Ireland.
§ Mr. Hughes
The hon. Gentleman is perfectly at liberty to refer to matters which are not in the Bill, and I think he did it effectively. Nevertheless, I repeat my point, which is that Northern Ireland receives quite substantial benefits over and above those provided for in this Bill.
In the first place, I shall examine the Bill against the background of what is happening and what has happened in the area I represent, the County of Anglesey, and in North Wales in general. The House will be aware that for a considerable time Anglesey has suffered from a high level of unemployment; indeed, unemployment there has been higher than in any other county of the United Kingdom. During the last seven or eight years the figures have gone up progressively from year to year.
A week today the Minister informed me, in reply to a Question, that on 12th October last unemployment in Anglesey stood at 11 per cent. of the insured population, and I fear that it will go up again during the coming three or four months. Unhappily, this is nothing new, because between 1932 and 1939 unemployment in Anglesey averaged 40 per cent. of the insured population, which was a much higher level than that for the areas which were subsequently scheduled as Development Areas under the Distribution of Industry Act, 1945.
Since I became a Member of this House I have frequently drawn the attention of the Government, both in debate and at Question Time, to this intractable problem. My hon. Friends the Members for Caernarvon (Mr. G. Roberts) and Merioneth (Mr. T. W. Jones) have also drawn the attention of the House to the problem existing in their counties, but up to now the Government have failed to 123 help us. The industrial expansion of the post-war period has had no impact whatsoever in North-West Wales. The industrial prosperity of which we have heard so much has not come to Anglesey.
The unemployment figure of 11 per cent. does not tell the whole story. It does not include those, women in particular, who, having failed to obtain work, have gone off the register. They form a concealed pool of unemployed in Anglesey and in the other areas we are discussing this evening. Neither does it include that class to which my right hon. Friend the Member for Llanelly (Mr. J. Griffiths) referred in his imaginative speech this afternoon, the young people who have to leave North Wales to find work. We believe that there should be work in these areas for them if they want to remain there. We believe that North Wales is the poorer when the cream of our youth departs for other areas.
Although Anglesey is on the northwestern seaboard of Wales, it has many attractions. The people of Anglesey are attractive. It has a surplus labour force which is intelligent and adaptable, and it enjoys probably—I say this with emphasis—the best climate in the United Kingdom. Nor is it far from the centres of population of Lancashire and the Midlands.
My hon. Friends and I have appealed time and time again that North-West Wales should be scheduled under the Distribution of Industry Act, 1945. Well, we failed, and what we got was the Distribution of Industry (Industrial Finance) Act, 1958. That Act was undoubtedly one of the greatest legislative failures and disappointments of recent years. I can say without hesitation that not a single unemployed person in Anglesey received work as a result of the 1958 Act.
I want to stress that there has been no lack of initiative in Anglesey. The county councils, the local authorities, the trade unions—all these bodies have explored every possible avenue in an effort to find work for the people. I have been privileged to co-operate with them, and I know the energy and thought they have put into their effort to solve this problem. I am glad to see that the Minister for Welsh Affairs is in his 124 place. I think he will agree that the local authorities and county councils in those areas in North-West Wales have done all they possibly could to solve the intractable problem which exists there.
That is the background against which I look at the new Bill, and in all fairness I must say that it is a more hopeful Measure for localities such as Anglesey than any we have seen for a considerable time. I concede that this is not a Bill which will please everyone. It is a "Jekyll and Hyde" Measure. Dr. Jekyll will prescribe curative measures, but Mr. Hyde will be there to limit strictly the number of patients on the panel. Many areas as a result of this Bill will feel exposed and vulnerable when they cease to be Development Areas, and the Government should be under no misapprehension about this. The comparatively high unemployment figures of the last twelve months show clearly that the Development Areas are still much more vulnerable in the face of depression than are other areas.
The first question I wish to put to the Parliamentary Secretary to the Board of Trade, who will wind up this debate, is whether the inducements which Part I of the Bill makes available are adequate. Will the industrialists come to the areas where work is needed? I earnestly hope they will, but now is the time to face the position squarely.
Factories built by the Development Commissioners at a fairly low rental have not been sufficient inducement. The 1958 Act was not a sufficient inducement. I wish to quote from a letter which I received today from the clerk to a district council in Anglesey, a gentleman who has worked hard to try to bring new industries into the country and, therefore, who speaks with considerable experience. This is what he says after studying the Bill:I am afraid I can only reiterate our contention which we have stressed time and time again, namely, that there must be real incentives to attract industry to this area, and that is by building factories to be let at a very low rental in order to offset increased transport cost. This has been done in Northern Ireland and factories of any design and size are offered at 9d. a foot. This has proved successful because quite a number of industries large and small have established there in spite of greater transport cost and difficulties as compared with our area. I can quote at least two instances recently where negotiations broke down because of this.125 That is because industrialists thought that the transport cost was an obstacle to their establishing themselves in Anglesey. I hope, therefore, that the Board of Trade will take comparative distances from population centres into account when fixing rentals of factory buildings.
Will the Parliamentary Secretary also make it clear that advance factories can be built under Clause 2? I listened carefully to the speech of the President of the Board of Trade, and I observed that he made no reference to advance factories. The wording of Clause 2 is obscure and it could be interpreted in two ways. A rigid interpretation could exclude the erection of advance factories completely. Again, Clause 3(2) is very obscure, and its very complexity could discourage an industrialist from taking advantage of it.
Clause 4 is the re-enactment of the 1958 Act, but it is an improvement on the 1958 Act. There is no foolish and frustrating provision here that an applicant must prove that he has failed to obtain money from other sources before applying. This restriction, incidentally has hindered industrialists from coming to North Wales.
I should like to know what the general directions are likely to be under Clause 4 (2). The regulations and general directions laid down by the Board and by the Treasury will be very important, almost as important as the Measure itself, because they can, if they are narrowly written, frustrate and nullify the proper working of the Measure. I shall not feel happy until I have read the regulations and general directions. A good deal of power is reserved in the Bill to officials—this is something which the House ought to observe very carefully—in the Treasury and the Ministry of Labour. I should like to be assured that these officials will be clearly instructed that the Bill must be interpreted flexibly. In his opening speech the President of the Board of Trade said he thought the Bill would be administered with elasticity. I hope that is to be the case, because my experience is that the 1945 and 1958 Acts have been interpreted so rigidly since 1951 that little came of them in the areas which could have benefited.
126 Can the Minister answer a specific question on Clause 7? Can he say that grants will be made available under the Clause for housing key workers connected with a small industry? We realise that in an industry which is termed as of "national importance", such as coal or steel, houses can be built, but can the Minister say that if a small industry came into an area and about six houses were required for key workers, those houses would be made available? We have to remember that the local authorities in the areas under discussion are comparatively poor and that help in this direction would be of enormous assistance to them and would enable them to make proper provision for the reception of new industries.
Part II is the vital part of the Bill. This is the lever which can project new industry into areas of unemployment, but if it is not used properly the Bill will be completely worthless. I hope, therefore, that adequate machinery will be set up in the Board of Trade so that industrialists may be interviewed properly when they apply for industrial development certificates and will be informed of the facilities which exist under the Bill in areas like Anglesey, Caernarvon, Merioneth, Lancashire, Greenock and North-East England. If the Bill is read and applied rigidly, if there are long and tedious administrative delays, if applications for industrial development certificates to the Board of Trade continue to be rubber-stamped, then the Bill will fail dismally, but if it is interpreted flexibly and administered with imagination and determination, then it will succeed. For the sake of the unemployed people in Anglesey and other areas which may benefit under the Bill, I hope it will succeed even beyond our expectations.
§ 8.26 p.m.
§ Mr. Robert Carr (Mitcham)
Persistent unemployment is a curse to the individual who suffers it and to any community that has it to any significant extent. Since the war we have succeeded in maintaining a generally high and stable level of employment over the country as a whole, and we have confidence about doing so in the future. But, equally, we have found that local areas of unemployment are extremely difficult to cure. Indeed, the greater the general level of prosperity of the country becomes, the 127 less tolerable and the more dangerous are local areas of persistent, high unemployment.
Therefore, along with many other hon. Members on both sides of the House, I was increasingly coming to feel that further measures were needed to deal with the problem, and I certainly welcome the Bill. I was particularly glad to hear that the hon. Member for Anglesey (Mr. C. Hughes) felt that the Bill would, indeed, provide some help for an area such as that which he represents. As he says, and as I know from some of the Questions from him which I answered in the past, he has for long with great persistence asked Questions, led deputations and pressed the needs of his area, and, indeed, by implication, the needs of other areas in a similar position. I am sure that he is right in feeling that the Bill is a step forward in the help which can be given to his sort of area.
To me, that makes it all the more puzzling why the Opposition appear to be taking this, to put it mildly, grudging attitude towards the Bill. Indeed, the right hon. Member for Llanelly (Mr. J. Griffiths) and later the hon. Member for Workington (Mr. Peart) talked about the Bill as ending the policy for the distribution of industry in this country. How could it conceivably do that? The Bill contains certainly no fewer, indeed, it contains more, powers than the Opposition have ever taken, or, to my knowledge, have ever advocated taking. I think they are confusing the facts and the practical limits of planning in this field with the mumbo-jumbo of centralised planning, to which they give verbal support on occasions.
Unless a Government is to take powers to direct industry, including the direction of labour, I do not believe that we can have a more positive planning of the location of industry than is envisaged in this Bill, which goes further than any Bill in this field has ever gone before in one most important respect. For the first time the Government can take account of the imminence of persistent unemployment in any area, and that is the essence of planning in this matter. Hitherto, we have had to wait until the unemployment has actually occurred.
It seems to me that, so far from ending the policy of the distribution of industry, 128 this is carrying it further than it has gone before, and it could not be carried further still unless the Government were prepared to take powers actually to direct industry. As far as I know, that has never been advocated by the party opposite, and it seems to me that in some of their objections to this Bill, there is a purely emotional dislike of change—a longing to cling to past methods and a belief that past conditions still exist.
The abolition of the Development Areas is one such example. Anybody in recent years who has tried to understand some of the difficulties in this field must have come to feel increasingly that the idea of the Development Area was becoming out of date and a hindrance, not a help. There is no doubt that in the past the Development Area concept was a right and necessary method of tackling this problem, but our problem has changed. There is a need today both for greater uniformity and greater flexibility in tackling local unemployment than we have ever had before, and the hon. Member for Anglesey knows this.
It is a very serious thing to schedule an area as a Development Area. I do not mind what Government is in power, there will always be long consideration, reluctance and caution before taking this step of scheduling part of the country as a Development Area. Once we have done so, I need not point out to hon. Members on either side of the House how very difficult it is in practical terms, whatever it is in theory, to de-schedule one of these areas. I am sure that we should be able to give help much more quickly, much more flexibly and much more uniformly than we have been able to do in the past, and I have come increasingly to the opinion that the idea of the Development Areas, however beneficial it has been in the past, was becoming more of a hindrance than a help. I wish to welcome this major step in this Bill. I do not believe that it will lead to any loss of planning of the area which some hon. Members opposite seem to fear.
There is one danger that has to be faced. This will depend tremendously in the future on tough as well as vigorous administration. I suspect that my right hon. Friend the President of the Board of Trade will be subject to tremendous 129 pressures from all sorts of forces to put this firm, this industry, this town, this village or this part of the county on the list, and that it will take great courage to decide which claims to accept and which to reject. All of us in this House have a duty and responsibility to consider very carefully before we press the President to keep adding to this list, because at any given moment there is only a certain amount of industrial expansion which is on the board.
I see that the right hon. Member for Battersea, North (Mr. Jay) shakes his head, but I think that it is one of the economic facts of life that, while Government policy can influence the expansion or otherwise of the economy, at any given moment there is a limit to the amount of development which is ready to come to fruition. If we add too many places to this list, we shall weaken the effectiveness of the powers to help those areas which need them most.
§ Mr. Carr
Of course, the more we can get expansion in the economy—and I must not be led off into an economic debate—and the expansion of our industries without upsetting our balance of payments or causing inflation the better for the whole country and in particular the better for those special areas that we are considering. It will need great administrative toughness as well as vigour to make this policy a success, and I certainly do not envy my right hon. Friend in the task before him in choosing at any given moment which places should receive the most help.
Another aspect, which also underlines the administrative importance of the Bill, is the question of industrial development certificates. This negative power is extremely important. Perhaps it is easier to be wiser after the event than it was at the time, but for a period this negative power was not used as forcefully as it might have been. While I support its more forceful use now and in the future, here, again, care must be exercised.
This is almost a game of bluff between the Board of Trade on the one hand and 130 the prospective industrial developer on the other Who is to give way? Will the Board of Trade be tough enough to force the prospective industrial developer to go to one of these areas, or so tough that the industrial development does not take place at all? It is an extremely difficult balance to strike. I have participated in these arguments in my industrial capacity and I have known of cases where it was difficult to convince the Board of Trade but where the industrial development genuinely would not have taken place if it had been forced away from the parent company. I do not envy my right hon. Friend his task in striking this very difficult balance.
I now want to turn to two other matters to which I want to draw especial attention. There are many commentators who are genuinely afraid of the danger of our industry losing efficiency if we pursue too vigorous a location of industry policy. They are afraid of pushing our industries to less economic sites and thereby reducing our national competitive power. After visiting many of these areas and firms, I think that that danger is exaggerated, because to counterbalance the obvious diseconomy, such as long freight hauls and high freight costs, there are other factors leading to greater efficiency, notably the ability to select one's labour force and to have a stable labour force. Although those economies are more nebulous, I believe that they counterbalance, if not completely, to a large extent in most industries some of the obvious disadvantages of being more remote from the main market centres.
Although the dangers are exaggerated, the danger of losing competitive power must be kept in mind, because in the end full employment and social progress of all kinds depend upon getting the maximum return from our national industrial and economic resources. Therefore, while I support this location of industry policy, I feel that in operating these methods of guiding industry to the difficult areas it is most important to use those methods which are least likely to cause loss of efficiency.
In that connection, I draw attention to and welcome two methods of assistance which receive greater prominence in the Bill than has hitherto been the 131 case. The first is the power to give loans or grants for both factories and plant and for the provision of working capital. I believe that once-and-for-all help to a company to set up or expand in one of these difficult areas is far less likely to shelter lack of competitive efficiency than is a permanent subsidised rent. I hope that this power to give loans and grants will be used as strongly and as generously as possible and, wherever possible, in preference to a permanent subsidised rent. Moreover, I believe that grants are more likely than continuing subsidies to stimulate expansion for a similar expenditure of public money.
Secondly, there is the greater prominence given to the reclamation of derelict land and the improvement of amenities and basic services. This is a social duty of its own. We already have about 240 square miles of derelict land in this country. I gathered from a speech by my right hon. Friend the Minister of Housing and Local Government and Minister for Welsh Affairs earlier this year that the amount of derelict land is increasing by a net amount of about four square miles every year. I know that the Bill gives power to deal with the problem only in these areas of unemployment, but I hope that the powers will be used because to use them is doing a social good in its own right. But also by making these areas more attractive in their amenities and their basic services we will be doing a great deal to attract many firms to them. There are firms that will go to these areas if those things are right without any other financial inducements.
There are two ways in which one can try to solve this problem of local patches of serious unemployment. The first is the policy that we are dealing with in the Bill, persuading and inducing new industry to go to these areas. That is essential and important. The second way is also one which we must not forget. We must use every possible means to ease the mobility of labour. We cannot do it only by taking workers to where work is. Nor should we take the reverse view and think that it is wrong for workers to move from some areas to others. We will not solve this problem by using either method on its own.
132 The Government are now bringing up to date and increasing their powers to help the location of industry. I ask my right hon. Friend the Minister of Labour to look at his powers for helping workers and their families to move to areas where opportunities for employment exist and where labour is short. Just as we are taking a step forward in the location of industry part of our policy we ought to be more forceful and generous in our help to workers to move to areas where employment exists. If we move on both those fronts at once we have good reason to hope for progress in the future.
§ 8.42 p.m.
§ Mr. J. P. W. Mallalieu (Huddersfield, East)
The hon. Member for Mitcham (Mr. R. Carr) suggested that what he called the grudging approach to the Bill by this side of the House might be due to our dislike of change. For my part, my grudging approach to the Bill is because I feel that it does not provide sufficient change. I have listened to debates in this House on this subject for some twelve years. Every time there has been a debate on local pockets of unemployment, somebody from Northern Ireland has got up to say how desperate the situation is there, and somebody from Anglesey has got up to say how desperate the situation is there. If the hon. Gentleman noticed it, the two speeches which immediately preceded his were made by hon. Members for those areas, the hon. Member for Belfast, East (Mr. McMaster) and the hon. Member for Anglesey (Mr. C. Hughes), both still saying how desperate the situation in their areas is.
Unless we are prepared to do something more drastic than the Bill envisages, those hon. Members who are still in this House in ten years' time will again hear speeches from representatives of Northern Ireland, Anglesey and other parts of the country saying how desperate conditions are in their constituencies.
At long last the major parties are agreed generally—I say agreed generally because there are one or two little local pockets of disagreement in one area of the Government's benches—not only that unemployment is a curse wherever it shows itself, but that the community as a whole has some obligation to do something about it. We are generally agreed on that.
133 The trouble seems to be that the main instrument we are inclined to use feels no such sense of responsibility. The main instrument is private enterprise, but although the major parties are agreed that the community has a responsibility for unemployment in one area or another, private enterprise necessarily has no such sense of responsibility. Its main job is to make a profit, and preferably the maximum profit. We also know that setting up a works in one of these areas, away from the main centres of marketing and from raw materials, thereby increasing transport costs, is likely to cut one's profit. It is therefore hopeless, as the Government recognise in the Bill, to rely upon private enterprise, unaided, to deal with these problems which are proving so intractable.
What do we do? We offer what the President of the Board of Trade calls inducements, but I would rather call bribes, to private enterprise to do what the community needs it to do. We have been offering those bribes, off and on, for twelve or fifteen years, and they have not been very successful. The Government now say, "We have not succeeded with the bribes we have so far offered to clear up these pockets of unemployment, so we must offer bigger and better bribes." I confess that, like the noble Lord the hon. Member for Dorset, South (Viscount Hinchingbrooke), I am getting a little tired of seeing us pouring out public money to private enterprise in the form of bribes.
I cannot understand why the right hon. Gentleman—whom we all recognise as being a non-doctrinaire, forward-thinking Conservative, and all that—is not prepared, in addition to using the other proposals contained in the Bill, to try the other instruments which lie to his hand. When he recognises that the community has a responsibility in the matter, why does he not allow the community to fulfil that responsibility? Why is he not prepared to allow public enterprise—State firms, municipal enterprise and direct labour—to take part in the job of clearing up pockets of unemployment.
Public enterprise, whether it be State factories, like ordnance factories, or municipal enterprise, can afford to operate on a much lower margin of profit, because it does not have to consider paying a rake-off to shareholders. It 134 would be possible for public enterprise to pay its way and remain viable in areas where private enterprise would find it difficult to do so. That is my major criticism of the Bill. It does not change anything very much. It is not prepared, in the future, to use an instrument which Governments have hitherto hesitated to use but which in my opinion would help us to clear up this serious although minor problem in special areas.
The problem of local pockets of unemployment is not the only one with which we are faced today. Unhappily in this debate there has been little talk about the coal-mining industry. There has been a very effective speech about cotton, but so far little has been said about coal. We all know that in that industry we are likely to face a problem at least as serious as the main problem with which the Bill is supposed to deal. I understood, from something which the Leader of the House said during the debate on the Gracious Speech, that it was the intention of the Government by means of this Bill to try to cope with the problem which we can foresee arising from contraction in the coal-mining industry. Here again, I think the Government have admitted that the community has a responsibility.
We all know that immediately after the war we desperately needed coal and miners. We all know that the miners did their job for the community extraordinarily well. They provided us with so much coal that now we have more than we need. But the Government are not saying to the miners, "Well, chaps, you did your job well. It is bad luck that now we are finished with you." The Government recognise their responsibility for planning new employment in the mining areas; but they are still persisting in using only the instrument of private enterprise, suitably bribed, and I do not believe that it will be effective.
I do not believe that where pits are being closed down in an area the Government will be able to induce private enterprise to move into that area without there being a long time-lag. They can offer inducements, but for quite a time private enterprise exponents will be scratching their heads and saying, not "Should we do this as a public duty?" but, "Is there quite enough in this for me?" There will be a time-lag and men 135 who have served the community well as miners will be out of work for a considerable period unless the Government are prepared to use another instrument, that of public enterprise, of putting State factories in areas which private enterprise is failing to serve.
If what I say applies to the contracting industries of coal and cotton, how much more does it apply to the problem mentioned by my right hon. Friend the Member for Llanelly (Mr. J. Griffiths), the problem of automation. I was in the constituency of my right hon. Friend not so long ago—watching Rugby football and looking at the economic facts of life there—and I saw the tremendous transformation in the tinplate industry. It is a wonderful transformation in which 4,000 men turn out more and better tinplate than did 27,000 only a few years ago.
§ Mr. Mallalieu
Everyone wants to see that sort of process continued and extended. We cannot live without automation. We cannot compete abroad and raise our own standard of living. We cannot have a surplus to give to backward countries. We cannot, as a country, give anything—we certainly cannot have an improved quality of life which should come with shorter hours—without automation. But how are we to induce workers to accept automation willingly unless we can give a guarantee that when they are displaced from one industry, another industry will be ready to absorb them?
If we give them that guarantee and say, "You can rely on private enterprise", we shall not believe what we are saying and they will not believe what they hear. They know that private enterprise cannot do that job on its own. It cannot be ready in a comparatively short period of notice to absorb men displaced from my right hon. Friend's tinplate works, or whatever it may be. Therefore, here again it is essential that the Government should arm themselves with other weapons beside those offered in the Bill, weapons which allow for prompt and direct action where the need arises.
This Bill and the philosophy behind it are a very big change, a change in mentality, a change in approach from, say, twenty years ago. It is the recognition 136 of the community's sense of responsibility. One of the worst single things that happened to me during the General Election campaign was at a meeting where I had been saying that this country owed an obligation to backward nations, especially the backward countries of the Colonies. I had been saying that we should have to do without things in order to provide them with the means of livelihood. At the end of my speech, a perfectly level-headed liberal-minded man asked, "Is it not time that we left these countries to stand on their own feet?"
That horrified me because it could equally be applied to old-age pensioners, it could equally be applied to one's neighbour in the next street who happens to be out of a job. It could be applied equally to these pockets of unemployment, to the contracting industries and to those thrown out of jobs by automation. That kind of selfishness was epitomised by the ungrammatical, pseudo-American, but truthful phrase, which won the party opposite the General Election, "You have never had it so good". This Bill is an attempt to undo some of the harm that phrase produced in the minds of people in this country.
Having made the decision that the community really has a responsibility, I beg the Government and their semi-supporters on this side of the House—I beg them, having once decided that we have a responsibility, a responsibility of neighbourliness, that we shall arm ourselves with the instruments which can turn that sense of responsibility into an effective policy.
§ 8.58 p.m.
§ Mr. Douglas Jay (Battersea, North)
I feel that I ought to start by congratulating the non-maiden speakers who have managed to catch Mr. Speaker's eye this afternoon, but I must also congratulate the many maiden speakers on the forceful, eloquent and persuasive speeches they have made. I am afraid that to single out some of them would be invidious, and that to enumerate them all would be almost impossible this evening.
I feel very much less hopeful about this Bill after listening to the speech of the President of the Board of Trade this 137 afternoon. He took an alarmingly narrow view of the aims, method and value of distribution of industry policy. His speech was in a very different tone from the speech we had from his predecessor before the election campaign. The President of the Board of Trade told us this afternoon that the areas to be covered by these powers will be narrower, not wider, than those covered by the older powers. There is to be something like 14 per cent. of the population covered as against more than 20 per cent. now before the 1945 Act is repealed. That, again, was not told to us before the General Election. The President of the Board of Trade also interpreted the powers relating to basic services in a far narrower way than they were conceived of in the 1945 Act, or originally operated immediately after the war.
That is bad enough. But when we set this attitude of the President of the Board of Trade against the record of the Government in the past three years, I find it more disturbing than ever.
I must first say something about the Government's record over these recent years in order to make plain to the President of the Board of Trade how not to act in this matter of distribution of industry policy. The Times of 29th October—and perhaps the right hon. Gentleman will listen to The Times if he will not listen to me—summed up the Government's record as follows:The Government's policy on areas of unemployment has gone through some remarkable changes during these past two years. It was less than a year ago that the Government were still clamping down completely on some of the major normal activities under the Distribution of Industry Act, were scarcely sanctioning or themselves carrying out any new building under it, and were giving no aid to local authorities for special work on basic services in the development areas.That is a perfectly just summing up of what has been happening in the past two years. It is no good the Parliamentary Secretary attempting to deny that the Government virtually suspended the use of these powers from 1956 right up to the early months of this year. For instance, they stopped almost entirely the building of Government-owned factories in Development Areas at the end of 1956 and continued this until the present year.
138 It is not only we on this side of the House who make these complaints. Lord Bilsland, in another place—and he is no party politician nor, as far as I know, is he a Socialist, but he is a man who has done great service to industry in Scotland—said this about the Government's use of the 1945 Act on 27th March, 1957:… a major Act of Parliament has been rendered practically inoperative. …"—[OFFICIAL REPORT, House of Lords, 27th March, 1957; Vol. 202, c. 805.]Indeed, Ministers at the Board of Trade in the earlier incarnation of this Government admitted this quite frankly. The present Minister of Health, then Minister of State at the Board of Trade, told us in answer to a Question on 5th June, 1956:But in view of the need for the strictest economy in Government expenditure, it has been necessary to defer consideration of all proposals for the provision of new Government-financed factories … under the Distribution of Industry Act, save in a very few cases. …When I asked him whether it was not utterly unprecedented for the Government to stop all building under these Acts in Development Areas in order to save money, the Minister of State replied:I am sorry if the right hon. Gentleman finds the policy of trying to save money unfashionable."—[OFFICIAL REPORT, 5th June, 1956; Vol. 553, c. 864–5.]He therefore admitted quite frankly that the Government had stopped the use of those powers in order to save money. Incidentally, it was only a few months later that they spent £300 million on destruction in Port Said. Apparently they considered that more fashionable.
In April, 1958, when all these powers were lying unused, the Government published their new D.A.T.A.C. Bill, which touched only a fringe of the problem. The then Minister of Labour, now Colonial Secretary, said that this wasan important development in distribution of industry policy."—[OFFICIAL REPORT, 30th April, 1958; Vol. 587, c. 389.]He gave a pledge that the Government would use it with "speed and decision." I am sure that my hon. Friend the Member for Anglesey (Mr. C. Hughes) will have some comments to make on the speed and decision with which that Act has been used in his area. We said then 139 from these benches that all that Bill did was to extend one small and unimportant part of the 1945 Act. By the introduction of the Bill today, nearly two years later, the Government admit that we were perfectly right.
That is not the whole story, because throughout 1956, 1957 and 1958, while unemployment was growing, the Government also suspended almost totally the operation of all the minor powers under the 1945 Act, including Section 3 on basic services, Section 4 on D.A.T.A.C. loans and Section 5 on derelict land. Those powers went almost completely out of use, and it was only when unemployment rose to 600,000 last winter and we put down a Motion of censure in the House that the Government revived the use of these powers, rather grudgingly and one by one. Even now it is not at all clear how far they are being used at present. Perhaps we can have some information about that before the debate ends.
The first thing I do not like about the Bill is the title, and the President's speech today showed that the change of title is no accident. Why did not the President call this the "Distribution of Industry Act, 1959", if he wished to have it? It was Mr. Ernest Bevin who conceived of the phrase "distribution of industry", which was enshrined in the White Paper of 1944 on Employment Policy, as well as in the 1945 Act, because he believed that the problem was not just to give emergency aid to a few small areas, but to plan distribution of employment over the whole country. It is every bit as important to restrain over-development in London, Oxford, Luton and such places, as to encourage development in the North and West. Indeed, those of us representing London constituencies spend every Friday evening listening to distressing stories of the bad housing existing in the Metropolis. That is just as much due to maldistribution of industry as is the unemployment in the North and West.
Further, by calling the Bill "Local Employment" the President is leaving the phrase "balanced distribution of industry" out of Clause 1 altogether. He is also letting the whole idea of diversification fall into the background. That is also a most retrograde step.
140 The President is preserving the industrial development certificates, and I am glad to see that in one or two respects he is strengthening them. Everything depends on the use made of them. The greatest failure of the right hon. Gentleman's predecessors was their unwillingness to use I.D.C.s to restrain overdevelopment in the London area.
The President frightened me more than ever today by speaking of factory extensions as if they were a type of building for which I.D.C.s could hardly be refused. The right hon. Gentleman must know that the great majority of new factories are extensions. If he admits them, he has lost the battle before he starts. I urge the President most strongly this evening to be genuinely and uncompromisingly tough about this in future. We certainly promise him our support if he makes up his mind to stop over-development in London.
It is no good the Government pretending that they have acted as vigorously as the Labour Government did. My right hon. Friend the Member for Llanelly (Mr. J. Griffiths) gave the essential percentages for factory approvals in Development Areas. From 1945 to 1951 Development Areas got 30 per cent. of the total new building. From 1952 to 1958 the Development Areas, though they were larger, got only 18.6 per cent.
I now ask the President to look at the reverse side of the problem. What has happened in the London and South-Eastern region? The whole Greater London region before 1951 got 12.3 per cent. of the total national building. I believe that that included the rebuilding of blitzed factories in the immediate post-war years. From 1952 to 1958 Greater London got as much as 18.4 per cent. That again is a decisive difference.
We now have new and most alarming evidence of the extent to which the Government have let over-development in London get out of hand altogether. My right hon. Friend the Member for Llanelly quoted the paper read to the British Association in September by an official of the Ministry of Housing and Local Government, which revealed the astonishing fact that from 1952 to 1958 40 per cent. of the national increase in employment occurred in the Greater 141 London region. This shows what perhaps some of us had not realised, namely, that the London region has been getting 18 per cent. of the new factory space but 40 per cent. of the new employment. We should ask ourselves why that is. Is it not almost certainly because of the extraordinary office development going on in London, which is not merely making London's housing and traffic problem insoluble, but is distorting employment and location policy all over the country? The L.C.C. has recently published some figures which I hope the President of the Board of Trade will study. They show that from 1954 to 1957 factory employment in the L.C.C. area actually fell by 18,000, but that total employment rose by 15,000 a year—that is to say, by 45,000 in the three years—obviously due to the office building going on all over the centre of London.
Does not that make it perfectly clear that we need just as tight a national control over office development as over factory development? Surely, it is no longer right—and I ask the right hon. Gentleman to consider this—that the national planning of factories should be in the hands of the Board of Trade and the other planning—office and commercial—should be in the hands of local authorities and the Ministry of Housing and Local Government. Perhaps the right hon. Gentleman can tell us how it is working at present.
We cannot expect the London County Council so to plan office development in London as to bring work to other parts of the country. That, obviously, is the work of the Board of Trade and not of any local authority. We should now consider whether it is not now time, by some machinery, for the I.D.C.s to cover office and commercial as well as factory building, and the whole of the control to go into the hands of the Board of Trade.
I still ask whether, apart from the office development, the Government are at present being tough even on factory development. Last spring, the Parliamentary Secretary repeatedly promised that he would be tough this time, while the Minister of Labour, who made so many promises in the debate of 18th March last, said:I think I am right in saying that virtually no purely new factory is given an I.D.C. in 142 the Greater London area."—[OFFICIAL REPORT, 18th March, 1959; Vol. c. 436.]Yet, in August of this year, we read in the City columns of The Times that at Maidenhead the Beecham Group is at present building a factory of 160,000 square feet to make hair preparations. While that goes on. the Government cannot pretend that they are carrying out a distribution of industry policy at all. That is just the sort of new project that should go to one of the areas of unemployment. The President of the Board of Trade talked about industrial costs, and the greater costs involved when a factory was further from London. But can he really argue that there is any technical or economic reason why hair preparations have to be made at Maidenhead, and nowhere else?
The other worst feature of the Bill is the extraordinary provision in Clause 1 that these powers will all expire in seven years. In our opinion, that is totally unjustifiable. There was no such limitation in any previous Distribution of Industry Bill, and this new provision rests on a misunderstanding of the problem. This is not a temporary emergency operation but a piece of vital, permanent planning. The urge of industry to come to the Metropolis is not something temporary but permanent. Incidentally, it is going on all over the world wherever there is a very large city, as I am sure the right hon. Gentleman knows. Nor were we told anything about this before the election. In the speech made by the right hon. Gentleman's predecessor on 15th September, there was no hint that these powers were in future to be temporary only.
That right hon. Gentleman, who is now Minister of Education, failed to mention in that pre-election speech an even more important provision of the Bill. What this Bill does on becoming law is automatically to deschedule all the existing Development Areas—I hope everyone understands that—and gives the Board of Trade power, in future, without any reference to Parliament, to schedule or deschedule any area it likes. We do not believe it to be right to put that power in the hands of the Board of Trade without any reference to this House, and I hope that my hon. Friends will oppose that provision.
Indeed, in some respects, the Bill is even worse than this because, as my 143 hon. Friend the Member for Sowerby (Mr. Houghton) pointed out, it has another Clause which says that the Bill comes into force, not necessarily when it receives the Royal Assent, but when the Board of Trade chooses that it shall come into operation. Therefore, for all we know, there could be a gap when there were no Development Areas whatever.
Why did the President of the Board of Trade introduce the Bill in this form at all? He could have extended the Development Areas widely under the previous Act. He could have introduced, had he wanted to, a small amending Bill to clarify the definition of derelict areas and other minor points. It seems to us that the only reason why he has not done so is because he wants to de-schedule certain areas which are now Development Areas. The honest way to have done that—and I concede that he may be able to make out a case for de-scheduling certain areas—would have been to bring forward an order under the 1945 Act scheduling some new areas and de-scheduling others. I believe that had he brought such an order before the House and the case for it were good, the House would have agreed both to scheduling and de-scheduling.
Now the position is quite different. We are merely told that there will be at some time a list of areas. That is all that we know. I would remind the right hon. Gentleman that his predecessor said before the election that this list would be published, so I suppose that we know that at some time, heaven knows when, the Board of Trade will publish it. We ask him tonight to tell us when it will be published. Is it to be published before the Committee stage, before the Third Reading, or when? Our view is that we must, in deference to the House doing its job properly, have this list published before we enter on the Committee stage. How can hon. Members be expected to discuss all the details of the powers if they do not know the areas about which they are talking? We feel that this is absolutely essential.
I hoped that the President had in mind, when speaking of localities, big areas comparable to the old Development Areas. But, after listening to him today speaking of small areas here and 144 small areas there, I must tell him that we are quite opposed to the idea which he seems to have in mind, that instead of large areas such as the whole of industrial Scotland, we are now to have just a few small spots linked together or not—we still do not know.
§ Mr. Maudling
The localities can be as large as existing Development Areas or as small as a particular place. There is no limit on size.
§ Mr. Jay
I am aware that that is the meaning of "locality" in the Bill. But, judging by his speech today, he has in mind small areas and not the large integrated regional areas scheduled under the 1945 Act. If that is not so, I hope that we shall hear from the Parliamentary Secretary tonight.
On one change, however, I can unreservedly congratulate the President, and I am very glad to do so. The Bill ends the muddle of a multitude of areas and gets back to one list within which all the powers are to be exercised. This was one of the main recommendations of the report which we produced last winter, and we were then told by the Government that it was quite impracticable and unnecessary. Now the Government admit what we said and are getting back to the sound principle of one list. They got into this muddle then in their own 1958 Act by introducing the additional list, which ended, as we warned them it would, in complete confusion. Once again it is the story of Suez: in you go and then claim credit for wriggling out later on.
There are two other questions which I must ask the Minister. The first is what has happened—there may be an answer to this, and if so I should like to know what it is—to the powers of the Distribution of Industries Act, 1950, for giving grants for the removal of firms from a congested to a Development Area? This Bill repeals the 1950 Act, but it is not at all apparent where those powers are embodied in the Bill. If they are there, we should like to know where they are, and, if not, the Bill should be amended to include them.
Secondly, what is the point of Clauses 8 to 13, which lay down all sorts of details about the way in which estate companies are to be operated in the future? Would it not be better to leave 145 these Clauses out of the Bill altogether? I remember that when the previous President of the Board of Trade introduced an Import Duties Bill two years ago, we pointed out on Second Reading that the Import Duties Board which he had included in it would be much better left out of the Bill. He sensibly accepted that suggestion and, to everyone's relief, in Committee he omitted all those complicated procedures.
Is it really necessary to have five Clauses stating just how these corporations are to act? Is this not a piece of organisation which the Board of Trade could much better operate, as it has been operated ever since 1945, without laying down all sorts of details in an Act of Parliament? This will only mean that if it does not work well in that way the President will have to come back to ask for amending Acts to alter the whole operation. Is there any good reason for having all this set out in the Statute in this fashion?
For all these reasons, we shall propose many changes in the Bill in Committee. Indeed, the reason why we do not oppose the Bill altogether, despite the President's rather chilling speech today, is that at least it embodies many of the essential powers of the 1945 Act. What we most care about is that the vital job of bringing essential employment to these areas should at least be done somehow.
I say to the President, with all possible emphasis, that what will matter most is the use he makes of his powers. There are two aspects which count far more than all the rest put together I am sure that the right hon. Gentleman realises this, even though he is fairly new to his job. The first of these two powers is the restraint on over-development in Greater London and some other congested areas. The second is the building of Government-financed factories freely in the areas of unemployment. Those are the two keys to the whole campaign.
In setting about this task, the right hon. Gentleman should not forget that, with the present outlook in the cotton industry and in the coal industry there is probably more need for a vigorous distribution of industry policy now than almost at any time since the war. If the right hon. Gentleman uses those two powers resolutely and persistently, he will succeed. If he does not, he will 146 not succeed, no matter what use he makes of the minor powers.
I give the President of the Board of Trade only this one other piece of unsolicited advice. I do not think that the Parliamentary Secretary needs it, but I give it to his right hon. Friend. Let him visit the areas personally and talk with the people who are on the job. That will hearten them and it will educate the right hon. Gentleman. Ministers in the Labour Government did this frequently. I have often heard the complaint from the areas in the last seven years that Tory Ministers hardly ever visit them.
This operation is not just a matter of paper and legislative powers. There is a spirit of devotion to the job amongst people on the spot like, for instance, Lord Adams, to whom my hon. Friend the Member for Workington (Mr. Peart) has referred. Indeed, Lord Adams was quite capable of acting not merely when he had the powers, but also when he did not have them. The right hon. Gentleman must not take this too literally, of course. But if he and the Parliamentary Secretary at last catch something of that spirit, I can assure them that they will have our support after all.
§ 9.24 p.m.
§ The Parliamentary Secretary to the Board of Trade (Mr. John Rodgers)
One feature that has distinguished today's debate has been the notable contribution which has been made by six maiden speakers. On behalf of my right hon. and hon. Friends, I should like to congratulate them on their fluency, eloquence and confidence.
My hon. Friend the Member for Torrington (Mr. P. Browne) showed great wit and humanity and a deep concern for the future of the rural population. The hon. Member for Bishop Auckland (Mr. Boyden) paid a graceful and, I think, well-deserved tribute to his predecessor who did so much in the sphere of the distribution of industry. My hon. Friend the Member for Cornwall, North (Mr. Scott-Hopkins) showed deep concern for the human problems of the unemployed and drew attention to the transport problems of certain areas and, I thought, indulged in a little special pleading for his own area which will please his constituents. We listened to him with great sympathy.
147 The hon. Member for Don Valley (Mr. Kelley) spoke from a sincere and intimate knowledge of the problems of the mining community. However, the problem which he posed about opencast mining is not for me or for my right hon. Friend the President of the Board of Trade but for my right hon. Friend the Minister of Power. The hon. Member for Lowestoft (Mr. Prior) did a valuable service in reminding all of us of the problems of the agricultural and fishing industries, which are so essential to our well-being, while the hon. Member for Burnley (Mr. D. Jones) made a moving and sincere speech, in which he depicted the appalling consequences of unemployment on the individual, to which we listened with great sympathy.
I should like to refer to one aspect of our debate which has been mentioned by several hon. Members, notably my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke) and the hon. Member for Workington (Mr. Peart), namely, that the Bill has been foisted on my right hon. Friend the President of the Board of Trade and that it was produced by sorcerers' apprentices or backroom boffins. Nothing could be further from the truth. From June or July this year, I, as Parliamentary Secretary to the Board of Trade, discussed the matter in great detail with my right hon. Friend's predecessor, the present Minister of Education, and it was considered on several occasions by the Cabinet, of which, of course, my right hon. Friend was a member. It has, therefore, gone through all the normal processes and I assure hon. Members that the Bill has not been foisted on my right hon. Friend.
The main problem which we are discussing is how far it is desirable and practicable to guide industrial development to particular areas without sacrificing competitive efficiency and yet with due regard to the social problems involved. The Cairncross Committee stated clearly two main alternatives for a policy on the distribution of industry. Should the State give priority to helping development wherever it takes place, or should it continue with the present policy, which is primarily to help cure localised unemployment and to relieve industrial congestion? I think that a cogent case can be made out for leaving market forces to determine the best 148 places for industry to be located. This it what my noble Friend the Member for Dorset, South advocated.
However, such a policy would demand far greater mobility of labour and far less mobility of industry and would leave out of account altogether strategic considerations and the more human problems. I think that the present policy, judged by the number and variety of work places found, has achieved a reasonable degree of success, although I agree that much still remains to be done. It has been successful in so far as it has economised in housing and local authority services and prevented the duplication of social capital.
The original concept of the Development Areas was framed in the light of pre-war experience of the special areas where large scale long-term policies were required to deal with persistent unemployment. The policy, under both Labour and Conservative Administrations, has, up to date, worked well.
The changes now proposed in the new Bill are designed to take account of the new and changing pattern of unemployment. It is true that some areas where there is now unemployment are geographically within the Development Areas and at least two coincide to a considerable extent with the Development Areas. I refer to Merseyside, and to Central Scotland—Clydeside, Glasgow and Lanark. The new problem which faces the Government is how to deal with the smaller, although sometimes equally intractable, centres of unemployment. In our experience, the Development Area concept is too rigid for the present situation.
When we last discussed the problem of the Development Areas, the hon. Member for Abertillery (The Rev. L1. Williams), in an eloquent and sincere speech, expressed the view that perhaps the time had come when certain Development Areas should be de-scheduled. This was the point made by the hon. Member for Sowerby (Mr. Houghton). As the House knows, however, up to date this has not happened. Why is this? Why is it that no area has been de-scheduled? In practice, places can be taken off the Development Area list, but no President of the Board of Trade has dared to do that. This is, first of all, because it is laid down that he must consult local authorities. Then, secondly, 149 there is the inevitable pressure from hon. Members on both sides of the House to keep certain areas on the development list. Accordingly, Ministers have had recourse to what amounts to administrative or de facto de-scheduling. That is not abandoning the powers but making no attempt to exercise them. That is what we have been doing.
Today the schedule covers nearly 18 per cent. of the insured population of Great Britain, and it is significant that the Select Committee on Estimates in 1958 criticised the apparent permanence of the schedule. It is not true to say, as the right hon. Gentleman the Member for Battersea, North (Mr. Jay) said, that my right hon. Friend prophesied that the new list would cover only 14 per cent. of the population. What my right hon. Friend said was that owing to this de facto de-scheduling although 18 per cent. of the population is covered in the Development Areas, only 14 per cent. is actively assisted by it at present.
§ Mr. Rodgers
What my right hon. Friend said was that the global figure would not differ greatly from the present one.
§ Mr. Rodgers
I think we are all agreed that if we want to bring aid and assistance to areas most in need, the smaller the list the more chance there is of bringing aid and assistance to those areas.
§ Mr. J. Griffiths
I think we shall have an interesting Committee stage. Since already the President of the Board of Trade seems to have made up his mind as to the de facto de-scheduling, does it not mean that before we reach the Committee stage he will be able to tell us what are the localities?
§ Mr. Rodgers
It would be wrong to lead the House to think that my right hon. Friend has already drawn up a list or that we are yet in a position to state 150 when the list will be published, as it will be.
§ Mr. Jay rose—
§ Mr. Rodgers
No, I cannot give way. Our first task is to get the new Bill with the new powers and then to consider publication.
§ Mr. Rhodes
There is only one criterion, and that is how much money the Board of Trade is prepared to spend.
§ Mr. Rodgers
Later I will come to the point about the money to be spent. To go on adding to the schedule, as was suggested by the right hon. Gentleman the Member for Battersea, North, would make it more difficult, not less, to concentrate on the worst-hit areas, where we desire to give the maximum assistance.
People who have studied this problem will agree with me that the present Bill greatly simplifies, and at the time strengthens, the powers of the Government to deal with the problem of local unemployment. On one point at least the right hon. Gentleman the Member for Battersea, North and I are in complete agreement, and that is that there is real confusion about the places where the various powers now apply. The powers given under the various Acts are complex and overlapping. There are, in effect, two lists: the Development Area list and the D.A.T.A.C. list. Incidentally, the latter is already subject to administrative decision and not to the decision of this House.
However, there are really more lists than even the two I have mentioned would suggest. In practice, there are places which are both Development Areas and D.A.T.A.C. areas, where we make use of both our powers to build under the 1945 Act and to make loans under the 151 1958 Act. There are Development Areas which are not D.A.T.A.C. areas. There are D.A.T.A.C. places which are not in Development Areas. There are places in which an I.D.C. would normally be granted but in which no other inducement would be offered. There are places where an I.D.C. would be normally refused. Finally, to add to the confusion, there are places where Development Fund facilities may be available for factory buildings but which are not in the first three categories, although some of their work may be discharged by Board of Trade officials.
To answer the stricture of the right hon. Gentleman, during the last twelve months I have, in point of fact, visited nearly all the Development Areas and the D.A.T.A.C. areas, and in my itinerary I was closely followed by the right hon. Gentleman himself, and so, doubtless, he heard more or less the same things as I heard when I went round the country.
I am quoting from the right hon. Gentleman's document when I say:… hardly a single industrialist or local authority representative … fully understands the application of all these powers to their own areas.This was because of the complexity of the Acts and the various powers. This alone, to my mind, would justify the introduction of the new Bill, to bring some simplification. Therefore, the first reason for commending the Bill to the House is that the publication of a single list only of the powers which will be applicable should make the new provisions easily understandable, particularly and most importantly, by the business community on whose co-operation we depend for the success of all our endeavours.
It should also, I believe, lead to smoother working that all the powers now, the new powers and the retained powers, will be concentrated in one Department, at the Board of Trade. Again, this will lead to greater simplification in administering the Act. This is the second reason why I believe the Bill should commend itself to the House.
As before, our basic powers to try to steer industry to localities of heavy unemployment 152 or localities where heavy unemployment is imminent and likely to persist are of two kinds. There is the negative power, the power to refuse an industrial development certificate; and there is the positive power, that is, the series of inducements which we can offer to firms to make it worth their while to transfer existing factories into or start new projects in specified areas. The new powers were enumerated by my right hon. Friend the President of the Board of Trade, and, therefore, I do not think at this stage I ought to enumerate them once more.
Consequently, I should just like to return to the use of the negative power, the refusal of the industrial development certificate. Before I leave the matter of the new powers, I should like to say that we believe that in the Bill there is plenty of evidence that our new powers to try to attract new industries to places which need that extra stimulation are greatly strengthened. I would mention only the grant which firms can have in the appropriate areas if they build their own factories, a grant of 85 per cent. of the difference between the cost of the erection of the factory and the current value on the market once it is built in the particular area.
The Opposition have made a great deal of play, and always do make a good deal of play with the allegation that we have not exercised our powers, particularly with regard to industrial development certificates, with sufficient toughness. I can assure the right hon. Gentlemen the Members for Llanelly (Mr. J. Griffiths) and Battersea, North, that we have not abandoned our policy of being tough with regard to the granting of industrial development certificates. The right hon. Member for Llanelly, in opening for the Opposition, talked as though the industrial development certificate policy had been abandoned altogether. He talked as though it was now an open decision for any firm to go where it liked without any reference to the Board of Trade. This, of course, is not the case. No firm can build more than 5,000 sq. ft.—it is actually slightly less than that—without an industrial development certificate, and in two regards we have actually strengthened the industrial development certificate power with regard to the change of usage of premises and to stop the abuse 153 of people building more than one building of about 4,900 sq. ft. and then joining them together in order to get a complete factory.
§ Mr. F. H. Hayman (Falmouth and Camborne)
Can the hon. Gentleman give some indication of the scope of refusals of industrial development certificates?
§ Mr. Rodgers
I could, but just to give numbers would not really give a true index of all that we achieved. A great many firms come to us to discuss with us the location of their factories and, of course, they do not make a formal application for an industrial development certificate in those cases where we tell them that if they do it will not be granted and where we suggest other areas where they should go instead. A mere statistical list of how many have been or have not been granted would not be a fair index of how we have exercised our powers.
§ Mr. G. R. Mitchison (Kettering)
Could the hon. Gentleman help me about this? Does the decision depend on the character of the product or the type of firm, or what? Could he say why Beechams were allowed to build the new factory at Maidenhead?
§ Mr. Rodgers
A great many factors have to be taken into account in deciding whether or not an I.D.C. should be granted. There is no simple answer to it. In certain cases, it would be utterly uneconomic for firms to have to hive off extensions, which in some cases could not be hived off without great loss of efficiency to the firm. Other firms require to be in certain districts for good specific reasons. Each one is judged on its merits. However, I can assure the House that we shall do our best to hive off part or the whole of a firm's activity and steer it away to areas on the two lists, though we must at all times pay due regard to the efficiency of industrial operation as a whole in this country. We cannot just refuse I.D.C.s, if by thwarting them we get development nowhere else and thereby do harm to expanding industry; for instance, to one which is contributing greatly to the export trade.
§ Mr. Mitchison
I am sorry to interrupt the hon. Gentleman. I do not know how 154 much hair wash is exported, but could he say what was the reason for allowing a new factory to be built at Maidenhead?
§ Mr. Rodgers
Of course, the hon. and learned Gentleman cannot expect me to deal on the Floor of the House with individual cases where licences have been granted.
I should like now to turn to the figures. A great deal of play has been made tonight about how the record of the Labour Party when in office was very greatly superior in the granting of I.D.C.s, as compared with our own record. Of course, what hon. and right hon. Gentlemen opposite never point out is that, immediately after the war, when building licences were required and firms were queueing up to get premises and there was a genuine labour shortage, it was easier to steer firms than it subsequently became during the time of world recession and when there was a definite reluctance on the part of firms to expand.
§ Mr. Rodgers
Let us turn to the figures and see whether it was a higher proportion. Figures can be very misleading, and the right hon. Gentleman for Llanelly is a past master at grouping together figures which are genuinely misleading.
The Labour Party's record looks fine if the years 1945–51 are lumped together—12.3 per cent. of all approvals in London in the South-East, and 30.2 per cent., as the right hon. Gentleman said in the Development Areas. But if this period 1945–51 is split up—and building licences which I mentioned a moment ago were introduced in the Development Areas only in 1947—a different picture emerges. The figures for the period 1945–48 were 6.4 per cent. in the South-East and 44.4 per cent. in the Development Areas. In 1949–51, they were 16.9 per cent. in the South-East area and only 18.9 per cent. in the Development Areas. Under a Conservative Government, the comparable figures for 1952–55 are 19 per cent. in the South-East and 17.4 per cent. in the Development Areas, and in 1956–58, 17.6 per cent. in the South-East and 20.2 per cent. in the Development Areas.
155 In other words, in the last few years our record is as good as, if not better than, that of the Labour Party, despite the fact that we have recovered from an international trade recession, and also despite the fact that a number of firms, as I well know from my daily contact with them, pigeon-holed their expansion plans until they knew the result of the recent contest. Now that that has been settled effectively, these plans are now being pulled out of the pigeon-hole.
§ Mr. J. Griffiths
Is the hon. Gentleman telling us that industrialists are affected by the result of an election? Is that their patriotism.
§ Mr. Rodgers
Certainly, the right hon. Gentleman must know well that policies threatened by his party which would interfere with the free functioning of private enterprise had a great effect on industrialists.
Now, I should like to turn to deal with the ring fence which the right hon. Gentleman suggested should be drawn round the London and Birmingham areas. This could not be done, and he must surely know, without vital loss to our industrial efficiency We must produce competitively. Certain firms must be allowed to expand if we are to keep our place in the export markets. While it may sound a good thing in debate to talk about putting a strict and tight ring fence round London and not allowing any further development there, it is utterly impracticable, and the right hon. Gentleman knows it.
§ Mr. Griffiths
My point was, and time will prove that I am right, that it is in the interests of efficiency that a ring fence should be put around London; otherwise, transport and other problems will become insoluble in the conurbations.
§ Mr. Rodgers
Our policy is to try to prevent any expansion in these congested areas that we can, but there must be, and always have been, exceptions, to the ring fence and the right hon. Gentleman did not allow for these exceptions.
Now I come to the point of why the Bill is only for seven years. It is not that we think that in seven years we shall have completely solved this very difficult problem, although, given a 156 healthy and expanding economy, we think that we can hope that we will have gone a long way to breaking the back of the problem. We do not share the easy optimism of the right hon. Member for Battersea, North, who in his pamphlet went so far as to say that by 1951 the Labour Party had very nearly once and for all removed the menace of unemployment in the Development Areas—and yet here we are debating Development Areas.
We believe that while we shall make a great deal of progress in the next seven years, it is right for Parliament to have an opportunity at the end of a seven-year period to see how well the Bill has functioned and whether it has lived up to the hopes we have of it. To make it a shorter period would be impracticable, because it takes about three to four years to get a factory built and operating and the workers trained and a few more years after that to see how the policy is operating. The shortest period for considering the matter again would be about seven years.
For that reason, we have not made this a perpetual Bill but have given Parliament the right to see how well it has functioned, whether we have administered it vigorously, and whether any changes are required in the light of new circumstances which, if we are successful as we hope, might well obtain. The whole situation of local unemployment may completely change in the next seven years and it may well be that other measures and other approaches are required. This constant attempt of the party opposite to try to fossilise the pattern of the country's industry is not something in which we can share.
The right hon. Member for Battersea, North, criticised the fact that the Board of Trade may now add or subtract from the list of places where there is high and persistent unemployment, without any recourse to the House. Of course, when it is published the list can be the subject of Adjournment debates, and Questions can be asked about why places are on the list or why other places are not. The House will have a considerable say in this matter, but our experience from administering development and D.A.T.A.C. areas to date shows us that the essence of our new policy must be that the greatest possible flexibility 157 should be kept and that the Government should be able to switch the operation of their powers quickly. For example, during the Summer Recess, when we are away for certain months, it may well be necessary to take administrative action which would be impossible if we had to have an affirmative Resolution of the House.
§ Mr. Rodgers
Questions as at present allowed would be allowed in this new legislation. Subject to consultation with the Chair, I do not know whether the day-to-day operations of the corpora-lions would be a proper subject for Question and Answer in the House.
§ Mr. Rodgers
I think that I have answered the question sufficiently.
Under Clause 5, our present powers for dealing with the problem of derelict sites are now extended. Many of the places which have scope for new buildings have not been cleared or are such eyesores as to be significant deterrents to potential employers, but do not fall at the moment within the present definition of the word "derelict". As hon. Gentlemen opposite know, since we have often discussed this subject, this carries the legal meaning of "ownerless or abandoned". Under the new wording the Board will be able to acquire all land whose derelict, neglected or unsightly condition makes it in the Board's view a hindrance to the achievement of the purpose of the Bill. The main object is to increase the employment potential of the area—not the employment incidentally provided for the work of clearing, although this may be itself important.
I know that one hon. Gentleman who was not lucky enough to catch the eye of the Chair wanted to know whether cotton mills could be demolished under this power. This will depend on whether the mill is in a town which is on the list and whether it gets Board of Trade approval as meeting the needs of the 158 Bill. Likewise, the powers, previously exercised by the Board, of the Minister of Housing, and the Secretary of State for Scotland, to make grants to local authorities for the clearance of land are extended by the new definition of an eyesore and by the addition of the power of making grants to local authorities for the purchase of land. The Board will again have to be satisfied that this will fulfil the purposes of the Bill. The Government believe that it is right that in general local authorities should do this work and should own the land in their own areas. The grant-giving powers are intended to be the main effective part of the Clause.
My hon. Friend the Member for Belfast, East (Mr. McMaster) asked about Northern Ireland, which is not mentioned in the Bill.
§ Mr. Rhodes rose—
§ Mr. Rodgers
There are a lot of points that I want to try to answer before ten o'clock. If the hon. Gentleman will excuse me, I cannot give way now.
I was asked by my hon. Friend the Member for Belfast, East about the possible effect of the Bill and the inducements available to firms setting up business in Northern Ireland. The assistance we are giving is not comparable with that given by the Northern Ireland Government. We shall concentrate on helping the few really distressed places while the Northern Ireland Government attempt to give the whole economy of the country a sharp jerk upwards. The philosophy and objects of the two Governments are totally different. We shall continue the policy of the closest co-operation between the Northern Ireland authorities and the Board, particularly in the exporting areas such as London and Birmingham. We have already helped Northern Ireland greatly in the past. We shall, through the tough execution of our I.D.C. policy, look after the interests not only of places with high and persistent unemployment in this country, but the needs of Northern Ireland, too.
I visited Northern Ireland during the past year and I have had frequent conversations with the Minister of Commerce in Northern Ireland. Our regional controllers have been of the greatest assistance, as I am sure the Government 159 of Northern Ireland will agree, in providing lists of firms and arranging for the introduction of firms that might be persuaded to go to Northern Ireland. We shall continue to offer those services to the Northern Ireland Government.
I hope that I can give a definite assurance to my hon. Friend that the proper distribution of industry as mentioned in Clause 18 will not exclude the needs of Northern Ireland. We shall do all we can to help them to parade the attractions of their country to industrialists.
I would now like to say a word about compulsory purchase which was mentioned by my noble Friend the Member for Dorset, South. He suggested that it was wrong that the powers which the Board possessed under the 1945 Act compulsorily to acquire land should be perpetuated. We accept that these are far-reaching powers which are to be used only with very good reason. In fact, the Board's powers of compulsory acquisition under the Act of 1945 have been invoked only four times. On one occasion land was purchased by agreement without the order being made. In two other cases powers were used principally to overcome legal difficulties. In one case only has the Board used its powers in spite of opposition by the occupiers. Nevertheless, experience has shown that only the existence of powers for compulsory purchase enables valuation officers to reach agreement with landowners on a reasonable basis. For this reason we think it necessary to have the powers in the background.
I now come to certain questions that were asked by the right hon. Gentleman the Member for Battersea, North. He asked why transfer grants have disappeared in the new Bill. The general power to give D.A.T.A.C. grants under Clause 4 obviates the necessity of continuing with these special grants, since the greater power includes the lesser. The hon. Gentleman asked why building grants could not be given, under the 1945 and 1958 Acts, to private businesses. In theory that is possible, but under the new Bill the amount of the grant is automatic, subject to D.A.T.A.C. approval and the agreement of the Board of Trade. There is an advantage now in that the sum which the firm can have 160 can be ascertained easily. Businessmen will be able to know roughly what sum they will be given by way of the 85 per cent. grant.
§ Mr. Rodgers
Its size could not have been so specifically ascertained under existing powers.
The hon. Member for Sowerby asked what would happen between now and the time when the Bill came into force. We shall carry on as at present under the existing legislation, which hon. Members opposite apparently think entirely adequate for the moment. They cannot complain if we carry on with it. All commitments will be taken over by the new corporations, and in those areas not included in the new lists the corporations will carry out the functions of good landlords. That means that they can still build extensions to properties and maintain them. But we shall not be offering inducements to new firms to go to areas not on the new list.
The hon. Member for Barry (Mr. Gower) asked what would be the position of servants and tenants of the existing corporations. Whatever are the existing obligations of the present corporations to their staffs and tenants, they will be taken over unchanged. I hope that answer satisfies my hon. Friend.
The speech of my hon. Friend the Member for Dorset, South does not reflect the philosophy of the Tory Party. It was an excellent presentation of old-fashioned Whiggery. While the Tory Party believes in the free play of private enterprise, it has always believed it to be the duty of the State to intervene to correct chronic distortions of the economy which might occur through the unfettered exercise of private enterprise. My noble Friend suggested that a better remedy than that contained in the Bill would be to lower taxation. If the economy is expanding, however, this would only make the discrepancies between areas of high unemployment and areas of low unemployment greater than they are at this moment. It is no solution to have a derating policy. This would cost more than the present system, because the benefit would go to all 161 people in an area and not to selected ones. This would frustrate my hon. Friend's policy of reducing taxation; it would increase taxation. My hon. Friend did not do himself justice on this occasion.
The policy as presented in the Bill is a continuation and strengthening of our powers of persuasion to get firms to go to areas of persistently high, or imminent or threatened, unemployment. As my right hon. Friend made clear, naturally the shorter the list the greater are our powers to help. The stick, that is, the grant of an I.D.C., remains the same, and we shall apply it vigorously. But the carrot will be found a little more juicy and palatable, especially with the new 85 per cent. grant.
We agree that the test of whether this Measure is successful in dealing with the problem of local unemployment will lie mainly in the vigour and urgency with which the new and retained powers are used. As my right hon. Friend said not long ago, it is not so much the letter of the Bill that matters but the spirit in which it is administered. To be effective it will undoubtedly involve greater expenditure than in the past. I can assure the House that the Board of Trade intends to use both its negative and positive powers to the maximum and with the utmost energy and vigour, in order to cure the undoubted distress occasioned by persistent unemployment.
Debate adjourned.—[Mr. Bryan.]
§ Debate to be resumed Tomorrow.