HC Deb 03 February 1960 vol 616 cc1127-82
Mr. Maudling

I beg to move, in page 16, line 11, at the end, to insert: or that section as extended by the Distribution of Industry (Industrial Finance) Act, 1958". This is a technical Amendment. The object of subsection (5) is to transfer from the Treasury to the Board of Trade securities for the repayment of outstanding D.A.T.A.C. loans as part of the general transfer of functions between the Treasury and the Board of Trade. The existing draft of subsection (5) operates only in relation to securities given for loans under Section 4 of the 1945 Act. Of course, it should also cover securities for loans given under that Section as extended by the Act of 1958. This is an omission from the original drafting which this Amendment repairs.

Amendment agreed to.

9.50 p.m.

Mr. J. Rodgers

I beg to move, That the Bill be now read the Third time.

In moving the Second Reading of the Bill, my right hon. Friend the President of the Board of Trade underlined the basic philosophy which lies behind this Local Employment Bill. While tonight we are discussing the Local Employment Bill, nevertheless the first concern of the Government, and particularly of the Board of Trade, must be with the economy as a whole. As my right hon. Friend said during the Second Reading: 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."—[OFFICIAL REPORT, 9th November, 1959; Vol. 613, c. 32.] While that must remain our overriding objective, it is recognised on all sides that the free play of economic forces may have unhappy social consequences. It is the Government's responsibility to do what they can to mitigate those social consequences. Frankly, having listened to a great deal of the debate, I think that the only difference between the two sides of the House is how far that mitigation can go without jeopardising the national economy as a whole. We believe that this Bill goes a long way in the right direction, and that is why we commend it to the House.

The Bill, as I think hon. Members will agree, has had a very full and thorough discussion in Committee and the speeches which have been made from both sides of the House show the great interest hon. Members, wherever they sit, have in this subject of unemployment. Broadly, the Bill, despite the many hours spent in Committee, has emerged substantially as it was presented to the House. There have been a few Amendments, and I think I should say improvements, made to the Bill. I should like to single out the robust proposal of the hon. Member for Hamilton (Mr. T. Fraser), which my right hon. Friend was glad to accept, that we get rid altogether of the suggested co-ordinating committee. This will have the effect of bringing the management corporations closer to the Government, and also of getting rid of some red tape.

I mention also the Amendment to provide that each of the management corporations shall have both an industrialist and a trade unionist among its members. This, I think, is a useful provision to ensure that the corporations exercise their professional functions with proper knowledge of industrial problems. Lastly, I mention the Amendment which the Government put down to ensure the preservation of the pension and superannuation rights of the estate company employees. I think their contractual rights are now safeguarded in all respects.

There have been these Amendments and others but broadly, as I said, the Bill has emerged unscathed. Hon. Members pointed out in the Second Reading debate and in Committee that the actual terms of the Bill are less important than the way in which it is administered. I agree wholeheartedly with this contention, and I can assure the House that we are determined to administer the powers given to us by the Bill vigorously and relentlessly. The recent announcement of the British Motor Corporation's tremendous development in Scotland, West South Wales, Merseyside and Stafford is an indication of what can be done when there is a conjunction of an expansionist climate and a Government determined to exploit those conditions in the national interest. Rootes have made a provisional announcement and I hope that others will follow from the motor car industry.

I apologise for again uttering the old cliche of the stick and the carrot, but I think it important to have in mind these complementary instruments for achieving our objective, both of which find their place in the Bill—namely, the industrial development certificate and the financial and other inducements. The Bill does not alter either the system of industrial development certificate control or the Government's policy in administering it.

What it does is to emphasise the importance we attach in our consideration of each and every application to the need for helping what are to be called the Development Districts. If a firm can go to one of these districts or hive off part of its activities there, we shall not let it expand in a congested area. But that does not mean that we shall inflexibly refuse I.D.Cs for everywhere else. There are many firms which are tied to their existing base or which can go some distance—for example to an overspill town from its parent town—but which could not go to a development district. In all those cases we shall, of course, grant industrial development certificates. To refuse them would merely lead to a frustration of economic expansion.

There are other parts of the country which need further industry, although they have not such high unemployment; here the benefits of this Bill ought not to be made available. In those districts also we shall not refuse I.D.Cs for any suitable expansions, but in the case of new projects we shall, of course, consider whether they could not go to a place which needs them even more. So much for the negative side of our control, without which the inducements offered in this Bill would not hold the attractions which I am confident they will hold.

I will not go in detail through the Bill, but it may be useful to the House if I recapitulate the five chief facilities which the Bill offers.

First there is the power to build factories for leasing or sale on favourable terms. This is not a new power, but it is now for the first time available over all the places which are judged to be areas of high unemployment.

Moreover, there is one useful extension in that the Board can build factories for an industrialist on his own land: there need no longer be the complication and expense of a double conveyance.

About a year ago I announced in the House that we would grant certain concessions on the rentals of Board of Trade factories either when the lease became due for renewal or when a factory was empty. These concessions were to be limited to cases arising in the following twelve months. I am glad to say that there has been a substantial improvement in the employment position and it is no longer necessary to make any abatement from current market rents. For instance, today we have only seventeen empty factories compared with twenty-eight a year ago. These special concessions have therefore been allowed to lapse as from 1st February in accordance with my previous announcement. The powers to grant concessions, however, remain, and if in the future we felt conditions justified such special treatment again, we would not hesitate to take similar action.

I should add that the position of Board of Trade factories outside the new Development Districts has not been forgotten. We are taking powers under Clauses 15 and 28 of the Bill to enable us to continue to carry out work already begun in the former Development Areas, to honour agreements already made and to carry out the normal functions of a good landlord.

On the other hand, in view of the importance of concentrating our resources on the Development Districts, our policy elsewhere will be to build new factories only in exceptional circumstances and to apply somewhat more stringent rules about building extensions to existing premises. If a firm occupying a Board of Trade factory outside the Development Districts requires an extension of its premises, we shall expect it first to consider the possibility of building for itself, and in most cases we shall be willing to sell the factory to the firm if it is willing to buy. If we are satisfied that these courses are impracticable, we shall in suitable cases be willing to build at Board of Trade expense, but we shall then expect to receive a rental for the extension calculated to give an economic return on the cost of building.

To move on to the second chief facility in the Bill, industry is now offered the choice of building its own premises instead of taking a lease or conveyance of premises built by the Board. The inquiries which we have already had, perhaps two months before the Bill becomes law, give us confidence of the interest which industry is taking in this new facility. I hope that it will prove of great value, especially to firms already in development districts, which want to extend their premises.

Thirdly, there is the provision again for loans and grants to be made to firms needing finance for their expansion in order to buy equipment or for the requisite working capital.

I am glad to acknowledge again the Government's gratitude to Mr. Slimmings, the Chairman of D.A.T.A.C., and his colleagues for agreeing to serve on the new Committee and so continue to make their advice and assistance available to the Government.

We have considered what should be the name of the new Committee, and have decided that it would be as well to preserve it as nearly as possible. It will, therefore, be called the Board of Trade Advisory Committee, or B.O.T.A.C. for short. While this may show a lack of inspiration, it at least should go some way to avoid confusion.

Fourthly, there is the provison that the Government can make grants for clearing up derelict, neglected or unsightly areas—or, indeed, the Board of Trade can itself undertake this work. I hope that much use will be made of this provision, not only for economic reasons but for improving the appearance of our towns and countryside. But hon. Members will not overlook that it is not a blank cheque for aesthetic improvements, desirable as that might be. Powers can be exercised only when the Board judge that their exercise would promote employment in the places that need it.

Lastly, there is the provision for basic services. This has been fully debated here, and I am sure that the House will not want me to say more about it.

So much for the main features of the Bill. Hon. Members opposite have said that it does not go far enough. The Government's view is that the inducements offered by it will prove of real encouragement to industry and commerce. Time will show which side is right, but I can tell the House that the omens, based on the inquiries already received from all parts of the country, are favourable to our view.

Throughout the Bill's Parliamentary history so far, the interest of Members has been not so much in the powers that we will exercise as in the places where they will be available. As my right hon. Friend said when we were discussing the Bill before Christmas, it was then—that is, before Christmas—too early to give any indication of our list of development districts, as they are now to be called.

Hon. Members will have in mind that the districts to benefit are those in which …in the opinion of the Board of Trade …a high rate of unemployment exists or is to be expected … We have to look, not only at actual figures of unemployment but also at the prospects of change either way—on the one hand, of further unemployment and, on the other, of new jobs coming to the area. We cannot, therefore, say what our opinion will be several months ahead, but if the Bill passes through its remaining Parliamentary stages without serious delays, we intend to bring it into force on 1st April, now less than two months away.

In these circumstances, the time has come when we can properly consider which are the places which should benefit under the new Bill. The Government are accordingly doing this, and my right hon. Friend has asked me to tell the House tonight that he proposes early next week to announce what he expects the list of development districts to be. This will not be an alteration of the D.A.T.A.C. list, on which we are at present working; it will be a list of the districts which we expect will benefit when this Bill becomes law.

The Government hope that this advance intimation will be of help both to industry in the areas mentioned in my right hon. Friend's statement, in that it will enable them to get ahead with new projects, and also to firms in congested areas, in that it will let them know the places in which they can look for help if they expand there. We also have to arrange for a smooth transition from the present D.A.T.A.C. arrangements to the time when the Board of Trade will become responsible for operating the financial provisions of the Bill.

I have already paid tribute to the excellent work which D.A.T.A.C. has done over the last 15 years, and have said how glad I am that the present members of the Committee are willing to go on in the future without break of continuity. Hon. Members will appreciate that it takes some time—normally two months or more—for D.A.T.A.C. to examine applications for assistance. It has to get a technical report on the project, which involves almost always a visit to the site, and there has to be a full and detailed report by accountants in order that the Committee may be satisfied about finances.

The Committee has, at present, some months' work in hand, more in fact than it can possibly dispose of before the new Bill comes into operation, which, as I have already said, we hope will be on the 1st April. In these circumstances my hon. Friend, the Financial Secretary, has agreed with my right hon. Friend that it would serve no useful purpose to put more cases to D.A.T.A.C. for consideration under the present legislation. The Committee will, of course, continue to deal with the cases they now have before them until the new Act comes into force. We hope that, in the intervening period, D.A.T.A.C. will be able to deal with a large number of the outstanding applications from other places on the present list. This need not hold up consideration of new cases for districts that are in the new list which my right hon. Friend will announce at the beginning of next week. The firms which have projects for those districts can prepare their applications for financial assistance and, if they like, send them to D.A.T.A.C. When the Bill comes into effect D.A.T.A.C. will pass the applications to the new Committee, B.O.T.A.C., which will be advising the Board of Trade. The new Committee will deal with them as soon as possible.

The Bill has been fully debated and I do not think that I need refer specifically to any other provisions than those I have already mentioned. I confidently commend the Bill to the House as one which meets the social and human needs of the community and what is perhaps the most important problem a man can face, that of having a livelihood which will give him both security and dignity.

10.5 p.m.

Mr. Douglas Jay (Battersea, North)

I thought that for once the Parliamentary Secretary did himself rather less than justice in saying that practically no improvements had been made in the course of our discussions. On the initiative of my hon. Friends, a number of substantial improvements have been made. Nevertheless, it is our opinion that all that need have been done in distribution of industry policy could have been done under the 1945 Act if the Government had extended the development areas. We go through this vast legislative process and, at the end of it all, we have changed D.A.T.A.C. to B.O.T.A.C. There is not very much more than that to say about it.

The only possible argument which the Government could advance for our having got any new power is the 85 per cent. building grant, which is not 85 per cent. of the value of the factory. but 85 per cent. of the difference between the cost and the alleged marked value. The Government have admitted that in the form of an annual grant that could have been done already under D.A.T.A.C. When it is analysed, the only extension in the Bill is the tiny difference between an annual and an outright grant for this purpose.

Against that, in at least four important respects the powers we now have will be narrower than the powers we had under the previous Act. The first and most important is that the Government will apply the powers to a very much smaller part of the country than was previously eligible for them. The Development Areas, as they still stand at this moment, cover 19 per cent. of the population and the D.A.T.A.C. areas cover another portion. Therefore, over 20 per cent., perhaps 25 per cent., is covered at present. We have been told by the President of the Board of Trade that the new list which is now to be published covers only 14 per cent. of the population. Therefore, there will be a substantial narrowing of the areas which will be helped.

Secondly, we now have a Bill which will entirely expire at the end of seven years, unless something is done to continue it. That is totally unjustifiable. The previous powers were permanent. The Parliamentary Secretary has not yet answered the requests addressed to him yesterday—I hope that the President of the Board of Trade still may—to explain what will be the position of the management corporations if the Bill were simply to lapse at the end of seven years, as it would if unaltered. Apparently they will remain in existence but will have no powers to carry out any of their functions, even though they will be the owners of a very large amount of public property. We should be told before we part with the Bill tonight what will be their position in that situation.

Thirdly, the powers of the President of the Board of Trade for declaring areas development districts, as they will now be, will also be less flexible than they were under the previous Act. Under the previous Act they could be made Development Areas if the distribution of industry was such as to give rise to a danger of unemployment. In the Bill there is no such provision. In that respect also the power is narrower.

Fourthly, Parliament is still deprived of its right to examine the list and say which areas are to be included in it. The Parliamentary Secretary tonight made the extraordinary statement that the list, which he has refused to disclose throughout the Bill's proceedings in this House, is to be published next week, so that it is obvious that he knows what it is and must have known for some time. He has been afraid to entrust the House of Commons with the information until we have parted with the Bill. That is an extraordinary procedure. He is willing that the House of Lords should discuss the Bill with full information about the areas before it, but he has consistently withheld that information from the House of Commons. I know that my right hon. and noble Friend the former Member for Bishop Auckland, Lord Dalton, has this very week taken his place in the Upper House—

Mr. James Callaghan (Cardiff, SouthEast)

This very day.

Mr. Jay

—this very day—and one reason for publishing the list may be so that he can discuss it in the proceedings on the Bill in the Upper House. In spite of that, it was an extraordinary decision to withhold the list from the House of Commons and then make it available for subsequent proceedings. Nothing the hon. Gentleman has said has convinced us that that decision was justified.

I fully agree with him, as we have said all along, that it is not the powers but the policy which matters. For that reason, I was a little disquieted by two remarks which the Parliamentary Secretary has just made. First, he said that he was to terminate the rent concessions altogether. That is a step backwards. Although we are very glad that only seventeen factories are now empty, it is in itself an argument for advance factories if the total is going down and there are seventeen factories empty My hon. Friend the Member for Aberavon (Mr. Morris) has a factory in his constituency which has been unlet for two years

The hon. Member is to take another step backwards, for he told us that there was to be an embargo on D.A.T.A.C,. or B.O.T.A.C., applications for the next month. That is not very encouraging and I hope that it does not mean that, as soon as the Bill leaves the House, the right hon. Gentleman will retrace all the steps he has taken.

Nevertheless, we should say how much we all welcome what has been achieved in the expansion of the motor industry. I regard the announcements of the last few weeks as a great success for the campaign on the distribution of industry policy which my hon. Friends have been running throughout the past year. Indeed, if Government policy were still what it was a year ago and by agitation and argument my hon. Friends have not altered it, I am afraid that we would have seen all that expansion in the Midlands and London areas.

We are to have three major expansions, that of the British Motor Corporation, that of Rootes in Paisley and I have heard a rumour that the Ford Company is planning a major expansion on Merseyside. I hope that that rumour proves to be the truth. However, it is notable that in these motor expansions there has not so far been anything said about Lanarkshire, which is the worst unemployment area in Scotland and is yet the area where steel sheet is to be produced. It is also significant that the North East Coast has been so far entirely omitted from the list of these expansions. I hope that the Government will keep the other motor firms up to the mark.

Incidentally, we have heard nothing from the Vauxhall Company. It is notable that the Vauxhall Company is one of the very few major companies in British manufacturing industry which has so far made almost no contribution to the Development Areas. I hope that the right hon. Gentleman will see that with the help of these powers the firm is made to make its due contribution.

We have had a lot of talk tonight about the play of competition and economic forces, and so on. I believe that that is a distorted view of the problem. On the whole, now that the Government have come to our way, to some extent, I hope that they will not think that in every case where a firm is steered to one of these development districts it is necessarily operating on higher economic costs to set against social costs. If it were, it would still be worth while, but I do not believe that that is true in practice. About half the products of the motor industry are exported, and that industry uses steel sheet, which is now produced in North Wales, at Shotton, and near to Clydeside. The most economic place to produce motor cars for export is therefore near the estuaries where the sheet steel is produced. It really cannot be economic to do what the motor industry has been doing, to carry sheet from Shotton to Birmingham and then send the cars for export from the London docks.

I hope the Government will not work on the basis of the facile assumption which, I know, comes from the academic economists but which is very seldom true. I address this argument seriously to the President of the Board of Trade. If he will talk to the people who actually discuss these extensions with many companies—this is not a party point—he will find that there are usually many alternative sites to which an extension could go between which there is very little difference in economic cost; but in the case of one site a great contribution to employment would be made whereas in other cases there would be all sorts of social difficulties. He ought to look at the matter in that light.

We welcome the motor car industry extensions and we extend congratulations to the companies as well as to the Government for the co-operation which has led to them. But we are not satisfied yet with the efforts the Government are making to restrain the extensions of new employment both in factories and offices in the greatest congested area of all, namely, London. In answer to a Question last week, the Parliamentary Secretary gave me some figures which work out in this way. During the period of the Labour Government, the London and South-Eastern Region had only about 12 per cent. of the total new factory space. The percentage rose to over 20 in the period until a year ago when the right hon. Gentleman's predecessor had more or less abandoned distribution of industry policy altogether.

In 1958, the figure was 21 per cent. for the London area. In 1959, it had come down to 17.6, but that was not a great reduction after all the talk we had heard. In the successive quarters of 1959, it was about 16 or 18 per cent. I hope the right hon. Gentleman will make up his mind about this. He wants us to think that he is doing his best. We will take it on trust from him, but the results in terms of figures are still far from impressive.

Office development has been the real cause of the huge extension of employment in London during the last five years. According to the London County Council's figures, total employment in Central London is increasing by 15,000 persons per year. If that is happening, then the Government really have not proper control of distribution of industry policy. We were very disappointed at the replies we received late last night to the suggestions we made about achieving greater control over office employment. The Parliamentary Secretary said that he wants to do something but he really does not know how to do it. He then said that it was not a distribution of industry problem but it was a planning problem, by which he meant town planning.

This is not really true. It is both a town planning issue and an employment policy issue. Indeed, if the major reason for further growth of employment in London is office work rather than factory work, then this is clearly a matter of employment policy as well as planning. He seemed to argue that it was not possible for new office work to be dispersed out of London; but he answered that argument himself because he said he thought it was a pity that the Egg Marketing Board had come to London and it should have gone somewhere else.

The Government know perfectly well that the Ministry of National Insurance was induced to go to Newcastle and the Inland Revenue went to Cardiff. I should think that the Prudential Assurance Company could do equally well what the Ministry of National Insurance did. I am sure that the right hon. Gentleman would not suggest that the efficiency of private enterprise is so much lower than that of a Government Department that the Prudential and other great companies could not organise their affairs as effectively in this matter as the Ministry.

Finally, on the subject of offices, I hope that, under the existing rather defective machinery by which office development is under the control of local authorities and distribution of industry policy is under the control of the Board of Trade, there will, at least, be practical consultation, even if there is nothing statutory, so that where there is an application for an office block to employ 3,000 or 5,000 people in the London area, that application will go through the Ministry of Housing and Local Government to the Board of Trade before a decision is taken. If that is not done, I do not see how we can have control in this affair at all. Finally, if the President of the Board of Trade and the Parliamentary Secretary will stick to their present protestations, both in stimulating new employment in the areas that need it and also in restraining it where it is not needed and where it is creating so many social problems, they will continue to have our support. We do not believe that the Bill is really necessary or that the job could not have been done under previous legislation, but now, having got it, we hope that it will he used. We shall support the hon. Member if he uses it, because, when all is said and done, it is the policy and not the powers that matter.

10.20 p.m.

Mr. Gower

Many hon. Members on this side will feel that the Bill, which we hope will shortly become an Act, is in many ways a much more suitable and appropriate instrument for dealing with the present problem than previous legislation. The right hon. Member for Battersea, North (Mr. Jay) reiterated many of the arguments adduced throughout our debates, and I do not think that he made a stronger case tonight than he has made on previous occasions. Among his criticisms was the fact that under this Bill only 14 per cent. of the country is likely to benefit. The right hon. Gentleman regarded that as a criticism of the Bill. I should have thought that, on consideration, he might agree that in the old Development Areas there are still today some districts still in need of assistance. On the other hand, in those areas there are districts no longer in need of help. For that reason, I think that it is an advantage in this Bill that the aid which will be given will be concentrated in districts, often smaller than those in the old areas, where help is most needed.

The right hon. Gentleman also suggested that the Bill does little apart from changing the form of one of the grants. He completely omitted to refer to the strengthening of my right hon. Friend's powers in the matter of applications for development certificates. I regard this as of considerable importance. He also did not refer to the fact that under the Bill the applications which can be made cover a much wider field. He also appropriated or arrogated to the Opposition most of the credit for the very definite achievements made in recent months by my right hon. Friend and the Parliamentary Secretary in implementing this sort of policy without some of the powers which they needed and which they will obtain under this Bill if it is enacted.

In recent months, in Wales—I can, perhaps, speak with greater knowledge about Wales than other parts of the country—and also, I believe, in Scotland a good deal of progress has been made along the lines which we want to pursue. We have noted with approval how my right hon. Friend, following the influence which he brought to bear upon some of the motor manufacturers not to develop in areas where they wished to develop originally, has followed up his success by persuading them to go to other areas in Scotland and South-West Wales. That has come about largely by my right hon. Friend's exertions, with the help in Wales of the Minister for Welsh Affairs and in Scotland, no doubt, with the help of the Secretary of State for Scotland. I am sure that the energy which my right hon. Friend and hon. Friends have shown in recent months will also be used in implementing the powers of this Bill.

With regard to the list which is to be published next week, it is inevitable that many districts will be disappointed, but the Bill is in that respect much more flexible than previous legislation. In previous legislation, we had for long periods rather large and somewhat inflexible Development Areas, whereas under the new Bill areas in which unemployment either increases or shows definite signs of increasing may qualify for the benefits of the Bill.

I conclude my comparatively brief remarks, by saying that we on this side feel that this is a most appropriate and flexible Measure for dealing with the problems which we face today and which are different from the problems which we faced at the end of the war

10.25 p.m.

Mr. Peart

I expressed my dislike of the Bill on Second Reading and throughout Committee. Even now, at this late stage, I still dislike the Bill and the fact that we are to end local initiative by the creation of a large corporation. There is still vagueness about its duration in the sense that the Bill caters only for a seven-year period. In Committee, we pressed for more reasons from the Minister why this should be.

I would have thought that in Committee more hon. Members opposite would have expressed their dislike of a large bureaucracy, which is what it could well be—a large organisation responsible for planning in England—instead of the old estate companies which we had, such as, for example, in my area, the West Cumberland Industrial Development Company. I dislike its ending and, for this reason, I have expressed concern. I am glad, however, that in Committee the Minister said that there would be, particularly in my area, consultation with bodies like the Cumberland Development Council. Although this has not been written into the Bill, my hon. Friend the Member for Whitehaven (Mr. Symonds) and I put down an Amendment and we have had that assurance.

Whilst I dislike the Bill, which will end local initiative and destroy something which has been created over the years, we must make it work. I only wish that there had been a statement earlier about the list. It is true, as my right hon. Friend the Member for Battersea, North (Mr. Jay) has said, that another place will be debating the Bill and will have an opportunity to study the list. That is the key to administration. I assure the Minister that if west Cumberland is not on the list or if our area of west Cumberland is fragmented, we will oppose it strongly.

I agree that what matters about the Bill is how it is administered and the will of the Government behind it. I believe that the President of the Board of Trade and the Parliamentary Secretary are anxious that the Bill should succeed—I think they are sincere when they say that; I am afraid, however, that I have no confidence in the broad commercial and economic policy of the Government. However, we shall wait and see, examine and probe. If areas are neglected, we will certainly criticise and if the corporations for England, for Scotland and for Wales do not do their job, certainly we will be vigilant and critical at every opportunity.

10.28 p.m.

Dame Irene Ward

I sincerely hope that, in giving my support to the Bill, I am serving the interests of the whole of the country and of the North-East Coast in particular. [Interruption.] Having gone through the 1930s, when in part of the constituency which I then represented in the House of Commons 84 per cent. of the employable population were unemployed, I hope that all Members of the House will do me the honour of believing that I am doing the right thing in supporting this new Bill without knowing what the list comprises. I must take that on trust, and I do so with some misgiving, because I know how difficult it will be if the list, when it is published, does not measure up to the hopes of those of us who want employment to be properly distributed.

No one would do other than congratulate those areas which have been fortunate to get the expansion of the motor car industry. I am delighted. I think we want prosperity in the whole of the British Isles. However, as my hon. Friend has laid a great deal of emphasis on the way in which the Bill will be administered, I want to point out that, as we have had the Secretary of State for Scotland, the Minister for Welsh Affairs, and the Cabinet interested in this whole expansion of the motor car industry in the parts of the country which require a stimulus to employment, I should have thought that it would have been possible, and at least psychologically desirable, for the President of the Board of Trade to have seen that some of the outstanding requests of the North-East Coast were met at the same time. Deep down in the hearts of those who live on the North-East Coast is the ghastly fear, which has been handed down from grandfather through father to grandson, that our interests are not being quite as well looked after, because we have neither a Secretary of State nor a Minister particularly looking after them.

I feel bound to say this because my hon. Friend suddenly gets up and shoots off a lot of statements about the position of those projects which come under the old D.A.T.A.C. till the appointed day, 1st April, and we have had no chance of hearing about them before. There has been no real opportunity of discussing whether these matters are being wisely dealt with. I should have had much greater confidence if I had been able to do what I was unable to do, to get in touch with the President of the Board of Trade while that policy was being built up and while the Cabinet and the Secretary of State for Scotland and the Minister for Welsh Affairs were busy dealing with the expansion of the motor car industry. In that way the interests of the North-East Coast have not, I think, been served. We have not been able to get the answer to the question, what is going to happen to the outstanding projects for a decision on which we are waiting.

I want for a moment or two to develop another aspect of the situation. When one has been in political life as long as I have one becomes rather suspicious. A great deal is said: I take it with a grain of salt. I refer to Clause 3, which says: For the purposes of this Part of this Act the Board may with the consent of the Treasury … With the consent of the Treasury. Will my right hon. Friend tell me, if I want to ask Questions, can I address them to the Treasury? Have we to take exactly the word of my right hon. Friend? Or, as the Treasury is involved in this, shall be able to raise matters with the Treasury as well?

I would ask my right hon. Friend a further question. I refer to the industrial development of all kinds and the expansion of industry and the need for industry in areas which are threatened, possibly, with unemployment through pit closures or the slackening off of demand for ships, and the like. Will these Treasury people, who are specifically referred to in the Bill, take any steps to inform themselves about how industry operates?

As I say, I have been in political life for a long time, and I have seen my area and other parts of the country which have been hit by heavy unemployment dealt with in varying ways. In the wanderings about that I have done and the inquiries that I have made from time to time I have never met a Treasury official in the areas looking into the problems affecting them. That is a great weakness. My hon. Friend has laid great stress on how the Bill is to be administered. We have had visits by the Minister for Welsh Affairs, the Secretary of State for Scotland and the Minister of Labour—I am delighted to pay tribute to him— to the North-East Coast looking at our unemployment problem. But we have had no visit from a senior Minister at the Board of Trade.

I am deeply suspicious that when people go to the Board of Trade to ascertain the best place for an expanding industry, my right hon. Friend and hon. Friend who have not been to the North-East Coast are not in a very good position to give information about my area. They do not know how absolutely grand our labour is. All who have developed industry on the North-East Coast under previous legislation have spoken of the happy relations which they have had with the workers, employers and local authorities. It is right that we should pay tribute to those who have made the North-East Coast the virile, vital place that it is.

When representatives of the motor car industry visit the Secretary of State for Scotland they find that he knows everything about Scotland. But as neither my right hon. Friend nor my hon. Friend has been to the North-East Coast, how can they paint to inquirers a picture of the North-East Coast in the glowing fashion in which it should be painted? I feel that in that respect we have not had the attention that we ought to have had.

I have listened to people talking about Scotland, Wales and Merseyside. I would just mention in passing that when the North-East Coast and Wales were suffering severe unemployment in the 30s the Midlands and Lancashire were relatively prosperous areas. My area, unfortunately, has a long tradition of unemployment, and the fact that we have had so little attention paid to us does not make us particularly hopeful that the Bill will do for us what we should like it to do.

I do not want to say anything against my hon. Friend the Parliamentary Secretary because I know that he will visit us. He is always very polite and I am sure that he is a very competent Minister, but as a junior Minister, having been in the Government for a very short time and not very long in the House, he cannot have on the Treasury anything like the effect that the Secretary of State for Scotland has. I see my right hon. Friend patting my hon. Friend on the back; my hon. Friend needs it. I do not think that the North-East Coast ought to be served by somebody who cannot dictate to the Treasury. I have had enough experience to know that in the hierarchy of the Government weight is one of the means by which one obtains favours from the powers that be. It is rather like the difference between a fly and an elephant. One really needs an elephant to do something about getting favours and dealing with matters of this kind.

I hope that in supporting this Bill I shall not be offering a hostage to fortune, because I should regret that very much indeed. I hope also that people in those parts of the country where there is satisfaction over the policy of the Government will not object if I say that I consider a little more attention should be paid to the North-East Coast, which has provided great inventive genius over a wide sphere. The Government and the country owe a great debt of gratitude to the late Sir Claud Gibb, managing director of Parsons marine engineering works, whose death was a great loss to the North-East Coast. I should like an assurance that our part of the world will have the support of the Minister to make up for the fact that we have not a Minister of our own.

10.41 p.m.

Mr. John Morris (Aberavon)

I wish to comment on the announcement by the Minister that the concessionary rents for Board of Trade factories will cease from 31st January. Reference has been made to the fact that I have one of these factories in my constituency. The Parliamentary Secretary said that there are 17 such factories still unlet. I welcome the fact that that is a reduction on the previous figure of unlet factories, but it is still 17 too many.

During the past fortnight I have been trying to obtain information from the Parliamentary Secretary about what would happen when the concession ends. I have written to him but so far have failed to get that information. It is a serious matter. We who have these factories in our constituencies consider that the rents asked for them by the Board of Trade is a major stumbling block to obtaining tenants. If there are still 17 factories unlet, I consider it a restrictive step to end the concessionary rents. The period should be extended and the concession improved. We have in my constituency a large and beautiful factory built by the Board of Trade where until two years ago 800 men were employed. Today there are none. A large amount of public money was spent on this factory. Now the property is deteriorating.

10.43 p.m.

Mr. Page

I am sure that the increased flexibility provided by this Bill will be welcomed by hon. Members on both sides of the House, but, as has been said, it depends on the administration of the provisions contained in the Bill and the policy which is applied to it. It would be entirely wrong to think that unemployment can be mopped up merely by building a factory in a district and letting it cheap.

I do not feel that in my area on Merseyside the lack of factory space is a problem. One cannot mop up unemployment among dock workers and ship repairers by providing a factory. But Government contracts could be provided to give work to ship repairers. In my area, a considerable amount of factory space has been closed and there is redundancy due to a decline in the number of Government contracts. I hope that the provision in the Bill for making loans and grants will be operated in conjunction with an intelligent use of Government contracts for regional work. It may not be satisfactory if a loan or grant is made to build a factory and if the undertaking is then left to fend for itself. After all, the Government are the largest single buyer in the country. A quarter of the goods and services of the country are purchased by Government Departments.

Regional purchases must affect regional employment. As hon. Members will recollect, there is a Government Contracts Preference Scheme. The Board of Trade Journal of 22nd May last year stated: Government Departments and the nationalized industries when awarding contracts by competitive tender are normally prepared to give preference to firms in the Development Areas and other areas of high unemployment (i.e. areas which have included in the list of places where Government assistance is available under the Distribution of Industry (Industrial Finance) Act, 1958), provided that price, specification, delivery, etc., are equal. If under the previous legislation, this Government Contracts Preference Scheme was applied, may I have an assurance from my right hon. Friend that it will be applied to those areas which will come in the list which he intends to publish? In my experience, the Government Contracts Preference Scheme has not operated as described in that paragraph. It may have been operated by some Government Departments in that way, but there is certainly lack of enthusiasm for it in the nationalised industries. Is my right hon. Friend satisfied that it will operate under this new legislation in conjunction with loans and grants?

It is no good sitting down to a beautifully laid table if no food is going to be served. It is no good our giving industry tools to do a job if there is no job there to do. I am sure that by combining this Government Contracts Preference Scheme and making it really operative, with the loans and grants and building of factories, this Bill will be a real success.

10.47 p.m.

Mr. Edward Short (Newcastle-upon-Tyne, Central)

I do not think very much of this Bill, but I hope it will be of some help in the north-east of England. As the hon. Member for Tyne-mouth (Dame Irene Ward) said, the problems there are getting worse day by day. I think this Bill will be a very blunt instrument for the job it has to do. The problem is how to cure regional unemployment in specific limited areas when there are almost boom conditions in the rest of the country. Those are areas which are not necessarily affected by a rise in incomes elsewhere.

The Government's remedy in this Bill is to encourage industry to go to those areas by offering financial inducement to them. When I was a boy I used to watch my mother at the wash-tub. I have a clear picture of the big bubbles made by the sheets in the water. I always remember distinctly as a small boy pushing down a bubble with my finger only to see it appear somewhere else. I cannot help feeling that this policy of the Government will do that— when there is a pocket of unemployment in X town and a firm is established there to produce, say, nylon stockings in order to provide employment, it will have the effect of making an unemployment "bubble" pop up somewhere else.

There seems to be no one in the Board of Trade, or in the universities where we might expect to find such persons, giving any real study to the question of regional unemployment. The last issue of Lloyds Bank Review had a well-informed article on the subject, but I believe no one is doing such work thoroughly. The hon. Member for Crosby (Mr. Page) referred to regional purchase, but I do not think anyone has gone into the question of regional purchase in this context.

In the North-East the problem is that the two basic industries of coalmining and shipbuilding are contracting very rapidly. They are basic industries which are not affected by a rise in incomes elsewhere. The coal industry is contracting very rapidly, and we have also to face the fact that shipbuilding and ship-repairing will contract, too. The capacity of the world's shipyards is far too big. All the world's merchant shipping could be replaced in twelve to fourteen years, but the life of a ship is twenty-five years. We must face the fact that our shipbuilding and ship-repairing capacity will never be used to the full again. On the Tyne, as well as elsewhere, we must face that.

No analysis is being made of these trends in the North-East. How far will these industries contract? At what stage will the contraction stop? What type of labour needs absorbing? Hon. Members on both sides of the House press for anything that is going. My hon. Friend the Member for Dunbartonshire, East (Mr. Bence) and I are almost in a state of open warfare about the Cunarders.

Mr. Bence

I am a pacifist.

Mr. Short

Such is the position in our areas that we press for everything that is going— motor-car manufacture, Cunarders and anything else. We do this without any sound information about the causes of unemployment in the areas which we represent. That is one of the grave weaknesses in the Government's industrial policy.

Another weakness is that no attempt whatever is made to integrate the social planning and social development of our region with the industrial development. In my area all the local authorities are building their great housing estates, educational facilities and so on. They are pushing ahead with slum clearance, although the Minister of Housing and Local Government, whom I am glad to see in the Chamber, is not helping us very much at the moment because of his delays with C.P.Os. All this development is taking place without any knowledge of what the future industrial pattern of the area will be. We do not know. There is no long-term planning of the way in which those industries will contract, nor do we know what will replace them when they have contracted.

I believe that it would be much better to tackle industries instead of tackling areas. For example, if the Government had an integrated and properly worked-out fuel policy it would bring some stability to the coal industry. If the Government made up their mind about shipping and put before us some shipping policy, that would help. Rather than tackling the problem by regions, there is much to be said for tackling industries.

Our long-term problem in the North-East is how to develop our industries and our social planning, too, in the face of our two contracting industries. I emphasise to the President of the Board of Trade the seriousness of the position. In the short term we have heavy unemployment. As I said in the House at Question Time today, we have the highest unemployment in the country in shipbuilding and ship-repairing. About 30 per cent. of our boiler makers are unemployed. The second oldest engineering works in the country, Stephenson Hawthorn, in Newcastle, which employs a large number of boiler makers, is being closed. The factory, which has a six-acre site in the middle of Newcastle—a well-equipped factory with railway sidings, buildings, drawing offices and other offices—will be vacated in March or shortly afterwards. This is private enterprise at its worst. This old firm, of Robert Stephenson and Hawthorn, which still bears Robert Stephenson's name—the Rocket was made there and hundreds and hundreds of other locomotives have been made there and sent all over the world—was purchased three years ago by English Electric. Three years later it is being closed down.

The name, which is a household word in engineering throughout the world, is being retained by English Electric and used elsewhere. It is a name which has been made famous by generations of Tyneside engineers. It is being taken away from us by English Electric and used elsewhere. I think that that is private enterprise at its worst. I hope to see the President of the Board of Trade about this in the near future, and I hope that he will help in this problem.

My point is that, in addition to the slump in shipbuilding and ship-repairing, the closing of this factory makes the position very much worse for our Tyneside boilermakers. The situation is extremely urgent, and I hope that the President of the Board of Trade will do his utmost to get some industry to the North-East. I am not so sure about getting Ministers to visit us. As far as I can see, every time a Minister comes to see us the unemployment figures go up. But I hope that the Minister will inform himself of our position, and do what he can to help us.

10.55 p.m.

Mr. Ifor Davies (Gower)

Many of my hon. Friends have said that they do not like the Bill, but we have also said that we welcome it, and hope that its provisions will be carried out in the spirit of the speeches already made on behalf of the Government. I sincerely hope that many of the promises we have heard will be carried out. As one who was a member of a recent deputation, I should like to join my right hon. Friend the Member for Battersea, North. (Mr. Jay) in congratulating the Government on their recent assistance in the expansion of industry, particularly in West Wales. I would be less than generous if I did not also acknowledge the assistance given by the Minister for Welsh Affairs, whom I am glad to see is with us now.

I also want to draw attention to the purpose of the Bill, which is stated to be the promotion of employment in areas of high and persistent unemployment. In this connection, I acknowledge that in parts of my constituency the unemployment figures are slowly decreasing, not because of the presence in that area—and I refer particularly to the Swansea Valley—of new factories, but because a very large number of people are now obliged to travel long distances to employment obtained outside these areas.

That poses a very serious problem, to which I should like to draw the particular attention of the Minister for Welsh Affairs. The Swansea Valley has suffered grievously from the closure of pits and obsolete mills and, bearing in mind the establishment of a motor-car factory in close proximity to my constituency, I am pressing for Government assistance in securing ancillary industries, particularly to the Swansea Valley. I ask, because the local authority has suffered greatly from diminution of rateable value as a result of the closure of the older industries.

The Bill also refers to assistance for the clearing of derelict land. The need for this in my constituency is also well known to Ministers from their various visits to Wales. Following his visit to Swansea, the Minister for Welsh Affairs will well remember also the derelict land on the immediate approach to the station. I hope I am not pleading in vain, but that, in the spirit of the Bill, we shall receive the support of the Government in this connection also.

I therefore welcome the Bill as it now is, in the sense that I hope that we shall receive Government help in response to our pleas on behalf of these areas which have been so grievously affected in recent years by the loss of their traditional industries.

10.58 p.m.

Mr. E. Fernyhough (Jarrow)

Like my hon. Friends, I welcome this small Measure. It is a small Measure, and I think that it will be totally inadequate to deal with the problem facing us in the next year or so. If, at a time when unemployment is going up, the Bank Rate is also going up, it is an indication of the nature and size of the problem that we shall have to face shortly.

I do not believe that this Bill will do for the North-East any more than could have been done by the Government with their existing powers The problem facing my constituency has faced it now for five or six years, and no matter how many Ministers come to see us, no matter how many deputations come to London, no matter how many questions are asked, in the House of Commons, nothing appears to happen at all.

The Parliamentary Secretary said that 12 months ago there were 28 factories unoccupied and there were now only 17, but I can tell him that for two years there has been a large factory unoccupied on the Bede Trading Estate and that last week another firm announced that it would leave that trading estate and transfer its activities to the South. I think the right hon. Gentleman has known about the empty factory and about the firm which intends to leave, but nothing has been done.

The right hon. Gentleman must know that the problem in the North-East, especially in my constituency, gets more acute week by week. Efforts must now be made enough in the North-East to stabilise the position, because we already have to face the closure of further pits and a considerable contraction in shipbuilding and ship-repairing work seems inevitable. No Government could deal with the problems of the contraction of coal mining and shipbuilding with a miserable Bill like this. Something much more substantial is needed. Much more determination than the Government have so far shown will be required if the problems of constituencies like mine are to be solved.

Throughout our discussions we have been unable to get any idea from the Minister of how much the Government think these provisions will cost—£5–10 million, £15 million, £50 million, or £150 million. The Government are so sure about the outcome of the Bill that they are unable to say what it will cost. Unless more is spent under this legislation than the Tory Governments since 1951 spent under the 1945 legislation, and the 1958 Act constituencies like mine will continue to face a growing unemployment problem.

I put this to hon. Members opposite as much as to my hon. Friends; whatever the difference between us. we all believe in democracy and democratic institutions. Men's support of democracy and democratic institutions is tried to the limit if week by week, month by month and year by year they are denied a place in society. Men who are unemployed feel outcasts and not wanted and can easily become the apostles of all kinds of philosophies to which we do not subscribe. The Prime Minister and the Foreign Secretary have said that the world challenge now lies in the social and economic struggle. The test of democracy in this country will be whether it can provide work for men able and capable of working. I make no apology for not believing that that is possible under the existing system. I do not believe that capitalism can, in the last analysis—

Mr. Speaker

We cannot discuss capitalism and alternative systems because there is nothing about them in the Bill. Perhaps we could on some other occasion, but not now.

Mr. Fernyhough

Then I will merely say that I do not believe that the economic and social policies which this Government will pursue under the Bill can answer our problems. And if they cannot, the time will come when the Government will have to give way to people who will find an answer.

The President of the Board of Trade said that it would not be possible under the Bill for any money to be spent on aesthetic projects without them showing an economic return. Why in the name of fortune should not the slag heaps in the north-east area be removed whether that makes an economic return or not? Why should the north-east and other parts of the country, and South Wales, be despoiled by slag heaps, while the Minister says, in the year 1960, that these eyesores cannot be removed unless someone is able to make a profit out of it? So much wealth has been created in these areas that these eyesores ought to be removed, and many able and skilled men wanting work would be glad even to do that, provided it would give them the dignity of earning their daily bread. I hope that on this aspect the Minister will not be so niggardly.

I hope I am proved wrong. I hope this Bill fulfils the purpose which the Government hope it will. I hope the Government will be able to prove that they can plan for and provide full employment, because I know what that means to ordinary men and women. If they do, I shall be the first to shout their praises, but I do not believe that when the Government's tenure of office comes to an end I shall be able to do that. I believe the old industrial areas at the next General Election will be facing the same problems as now.

11.7 p.m.

Mr. Ross

The purposes of this Bill are of supreme importance, because the Bill deals not with localities or districts, as the new name is, but with people who are presently unemployed or likely to be unemployed. The purpose is to build up the industrial health of Britain and to improve the economic strength of Britain. I cannot imagine any purpose being more important than that.

The question arises whether or not this Bill in its present form will be able to do what it seeks. Even if we had added all sorts of additional powers to the Bill, it would not have guaranteed its success. In its present form, the Bill gives a tremendous responsibility to the President of the Board of Trade, a greater responsibility free from Parliamentary control than he has had in past legislation. With his advisers, he can decide which areas under Clause I are to get the benefit of help under these powers.

One of the strangest things is that wile we have been discussing all this in relation to various areas, we have not had the slightest idea what areas are going to be covered. We hear about new projects going to Scotland, but we do not even now know the areas that are going to be specified. The President of the Board of Trade has not been very fair to the House in this respect. If he can announce this for the greater enlightenment of another place, he might have speeded matters up and enabled us to conduct Report and Third Reading knowing whether certain areas are to be included or excluded. It depends entirely on the right hon. Gentleman.

Decisions concerning building grants, loans, derelict land and all the rest of it rest with the right hon. Gentleman. He has a serious job. The history of the problem right back from the old designated areas, the fact that it has been so intractable and so far has not been solved despite many Acts of Parliament and many Presidents of the Board of Trade. I hope will make the right hon. Gentleman appreciate just how important it is and how continuous must his attention be if he is to make any impact upon it.

I have not the slightest doubt that after the Bill is passed the right hon. Gentleman will turn his attention to the Outer Seven or to some other aspect of trade. If this were his only job, it would take all his time, but this is only one of his many jobs. It is one of the weaknesses of the Bill that we are not getting the full attention of one Department to this problem. It is not a question of one area, but many areas with different problems. I doubt whether we shall be satisfied by the Bill as it is at present.

In Scotland, we have a national tradition that we look gift horses in the mouth. When we were discussing some matter relating to Scotland yesterday, the right hon. Gentleman said that there was to be a development employing 3,500 workers in a part of the motor car industry. Whatever else that is, it is not to be done under the Bill, but under the existing powers. Not one of those jobs is to be provided for three years. Despite this transfer of part of the B.M.C. interests to Scotland and all that has been said about restricting development in presently over-industrialised areas, the main development of B.M.C. will go on in the present areas.

Mr. Maudling

The entire increase in the employing capacity of B.M.C. will take place outside the existing area.

Mr. Ross

Scotland will get a transfer of what is being presently done, but there will be a considerable expansion in the present area. I do not think that the right hon. Gentleman will deny that. The build-up in relation to employing labour in Scotland will not start for about two years. At present there are 100,000 unemployed in Scotland, and the situation is worsening. I welcome the fact that the right hon. Gentleman changed his mind about keeping the word "imminent." We now have in Clause 1 a much better definition of the time within which he can take action to meet expected unemployment. Where is the action which will lead to the necessary 20,000 jobs per year in Scotland, starting this year? Was it taken three years ago, two years ago or last year? It is not in the Bill I hope that the right hon. Gentleman does not think that Scotland will be fobbed off with a few headlines, a few new factories, some expansions and bits and pieces of this and that when we are faced with the present problem and there is no indication that the Government will meet it properly.

Mr. Short

They have not started on it.

Mr. Ross

Even with what we have got in relation to the expansion of the motor car industry, Scotland has a pretty poor share. We welcome it, but we are certainly not satisfied that it will meet all Scotland's difficulties. I sincerely hope that in the decision still to be taken concerning Vauxhall, the needs of Lanarkshire, of Ayrshire and of Scotland will be properly considered.

The Bill is simply meeting a commitment that was entered into during the General Election when itinerant Tory statesmen discovered that there was unemployment in Scotland and they had to do something about it. Here is their major Bill. It is a bit of temporary Tory tinkering. What is being done, and what is being headlined, could be done under existing legislation. The Bill tinkers with that existing legislation. Members were not sufficiently persuaded last night why the Government must stick in the business of seven years. The result is this temporary Measure.

The outcome will depend upon the will and the power of the President of the Board of Trade to use his powers. I assure him that Scotland will be watching and will be anxious to ensure that no opportunity is missed to impress upon him the continuing need, month by month and year by year, to attend to the problems of Scotland and to overtake the time lag in relation to industrial development.

The right hon. Gentleman's hand has been strengthened to a certain extent by the granting of industrial development certificates. If he looks through his files to see what has been done in the past. I think he will admit that opportunities have been let slip. I hope that the right hon. Gentleman will use his powers and that if ever there is any question that the person behind him is in any way obstructing him in getting on with the job, he will give the House of Commons an opportunity of coming to his assistance. I refer, of course, to the Treasury. The hon. Lady the Member for Tynemouth (Dame Irene Ward was right.

When the Bill is implemented, we may well need to spend an awful lot more money than we have been spending. The noble Lord the Member for Dorset. South (Viscount Hinchingbrooke) complained about grants and I gave him the figure about grants in relation to Scotland for over a year—just a few thousand pounds, which meant only about 500 jobs. I hope that hon. Members opposite will be as vigilant as we are to ensure that for the well-being of our country, with its persistent high rate of unemployment, with which our people—it is no use the hon. Member for Torquay (Mr. F. M. Bennett) smiling. We have had to live with this problem for many years in Scotland and unemployment at the rate at which we have had it—and it is getting worse—causes considerable worry and insecurity. I wish I was as sure as the hon. Member that something will be done. The passing of the Bill alone will not get it done. Whether anything is done depends on the use that is made of the powers and on the Treasury, the Board of Trade and Members of Parliament here. We must keep on to ensure that something is done.

Hon. Members opposite should realise that the existence of the Bill points to the failure of what they were proclaiming to the people of Scotland as the salvation of Scotland—private enterprise. If private enterprise was fulfilling its job and meeting the needs of the country, the Bill would not be necessary. It is because it does not meet the needs of the nation that we must resort to the bribery of loan, the inducement of grants and the persuasive powers of negative control, added to all the rest, to try to steer undertakings into areas where, for the well-being of the community, industry is needed. That is really the job which the President of the Board of Trade has got to start on after this Bill is through.

I can assure him that we from Scotland shall not slacken in our vigilance, because this is just about his last chance in this business. If we in Scotland continue to have mounting unemployment, of which the figures have doubled since the Tories came to power in 1951, I can assure him that at the next election it will not only be a question of more Conservatives being defeated: let him not be surprised if Scotland turns to nationalism—that has happened before—if we see that our just demands are being neglected by an English-dominated Parliament. The hon. Lady the Member for Tynemouth knows quite well that when she went to support her point of view in the Lobby tonight, along with me, we were voted down by a majority of Members from English constituencies, most of whom do not properly appreciate the effect of unemployment in these areas.

I give the President of the Board of Trade this warning. Let him not weary of well doing. I am satisfied that after his visit to Scotland he appreciates the problems of Scotland, but it will take continuous and persistent efforts on his part to ensure that sufficient industries are steered there, or sufficient Scottish industries are encouraged in growth to fulfil the need of the people of Scotland.

11.22 p.m.

Mr. Bence

In all the speeches I have heard from that side of the House, I have not yet heard one which was enthusiastic in support of the Bill. I have spent a good deal of time in the Chamber, in Commitee, on Second Reading, and now on Third Reading, and I have not heard one speech from that side of the House enthusiastic in support of the Bill. From every northern part of the Kingdom and even from the South Coast there have been expressed fears that this Bill will not really be effective.

However, my main reason for rising tonight is that I was interested in the point of view of my hon. Friend the Member for Newcastle-upon-Tyne, Central (Mr. Short). I assume that under the Bill the President of the Board of Trade, in consultation with his advisory committee and the Treasury, will have power to use discrimination as between types of industrial enterprise which he may choose to encourage to move from one area to another. This Bill deals, presumably, only with financing any sort of industry which will give employment in moving from a densely industrialised area into areas like Scotland, the North-East Coast or Wales where unemployment is heavy mainly because the mainspring of economic activity in the past has been a group of capital-producing industries.

I believe that there is something in this and that it ought to be considered. I believe it is very important. Taking the whole of Scotland, it might be desirable in the interests not only of the economy but of Scotland to induce into Scotland industries which produce those consumer durable goods which enter regularly into the domestic market.

Mr. Ross

Not too durable.

Mr. Bence

Not too durable, I agree. I have been in the motor car industry all my working life. Let my hon. Friend be assured that I am well inculcated with the idea that eighteen months is about long enough for a car to last. I will not mention a particular make of car. We can make them last a good time more. However, I appreciate the point.

This employment problem is a frightful one, and it is difficult for any Government to try to ease the pressure on labour in certain areas and to stimulate employment in other areas. In trying to solve it, we might consider not only geographical areas but also types of industry.

If I might support that point of view by—

Mr. Speaker

The hon. Member may if he can relate it to the terms of the Bill. I am listening with much attention.

Mr. Bence

I suggested—I thought I saw the President of the Board of Trade nod—that the Minister would have powers within the Bill, in consultation with his advisory committee and the Treasury, to make the inducement perhaps a little better to certain types of industry which would more favour his purpose in that they would provide more employment. I believe that he has the power to make a choice between industries. Will he assure me that he has power to discriminate? If he has not, then I cannot deal with the point. As the Minister makes no reply, I assume that he has the power. The point is that in Scotland—

Mr. Short

On a point of order, Mr. Speaker. Surely this is very relevant to the Bill, because the whole point is that this is the type of industry that we want in these areas, industries producing durable consumer goods which will benefit from an increase in income elsewhere, and not the old basic industries which do not necessarily benefit appreciably from a rise in income elsewhere? This is the only way to ensure that these areas share in the general prosperity of the country.

Mr. Bence

My hon. Friend has helped me considerably and made the point I was about to make, on the assumption that the Minister can discriminate, that it would be advisable to place industries of the type he mentioned in Scotland. When B.M.C. commercial vehicle production comes to Scotland, that will not be further diversification. In Scotstoun we already have a huge commercial vehicle plant, Albion Motor Co. Ltd., now controlled by Ley-lands, and it produces the same capital goods as B.M.C. will do. It is not diversification in the sense that we shall be producing goods which will skim off purchasing power from other parts of the country. If we had industries producing consumer durable goods such as electric fires, kettles and saucepans and other articles for the general domestic market and for export as well, it would help us to get away from the frightful dependence on the production of merely capital goods. The Scottish position is that much of the extra purchasing power generated will be plunged down to the Midlands market where all the consumer durable goods are produced. It would be good economic policy to differentiate between different types of industries when dealing with certain regions.

The B.M.C. factory will, it is estimated, employ 3,000–4,000 men. By the end of March a factory in Dunbartonshire employing 6,000–7,000 men will be closing down, so that the effect of the B.M.C. factory is nullified already. Unemployment is now in the region of 98,000, having gone up about 2,000 in the last few months, and it is likely to continue rising. When the Rootes Group and B.M.C., on their own figures, come into operation they will employ only 7,000 men between them.

I shall be very much surprised if when B.M.C. has laid down the plant and is ready to go into production the toolmakers and production engineers have not so designed the production techniques that they increase the output per man-hour as a result of new technology, so that it may well be that the estimate of 3,000–4,000 men being employed in three years' time may be reduced to below 3,000. Because the capacity of the industry to progress technologically is terrific, especially after moving to a new site and getting a factory built with the maximum functional design. Anyone who knows the Renault plant in Paris and has seen its techniques will know that it is the most modern and the fastest producing plant in the world.

Mr. Fernyhough

It is State-owned.

Mr. Bence

Of course it is State-owned.

Mr. Speaker

Order. Whether State-owned or not, there is nothing about the Renault plant in this Bill. I must ask the hon. Member to assist me in keeping the rules of order.

Mr. Bence

I am sorry, Mr. Speaker. We were dealing with the movement of the motor industry to Scotland, and I have been connected with the industry all my working life. My hon. Friend led me astray, but I will try to stick strictly to the terms of this Bill.

The point I am trying to stress is that we should move more manufacture of consumer durable goods into Scotland. Another point was made by the hon. Member for Crosby (Mr. Page), who is now asleep.

Mr. Page

I am wide awake

Mr. Bence

The hon. Gentleman referred to the placing of regional contracts by the Government. In this Bill there are powers to enable the Government to assist those enterprises which are already in existence. In Kirkintilloch, in my constituency, there are several boundaries where for years before the war castings were made. In the last five years they have lost their contracts for the Post Office. The Government have placed those contracts somewhere in England. Surely the Government could play their part in this matter by ensuring that contracts are places where there are resources and equipment capable of producing what Government Departments require, whether it is on the North-East Coast or in Scotland. Surely it is reasonable to expect that from a Government whose purpose it is to try to solve the terrible problem which has existed for the past 30 or 40 years.

There is a sort of schizophrenia among hon. Members opposite. We have had three Measures designed to solve this problem and failed, and this one may fail for the same reason—the fear of State intervention and State planning. Let us be honest about this, for goodness sake. No group of business men can be expected to solve a social problem which is essentially the responsibility of the Government. A motor car manufacturer cannot be expected to solve a social problem. It is his job to study the conditions under which he employs his workers and to see that he pays them decent wages and that his equipment is good. He has no power to solve a social problem. His bank manager would not allow him to do so. If he were successful in solving a social problem, and his bank overdraft went up by £1 million every year, he would soon he out of business. Private enterprise cannot be expected to do this. Hon. Members opposite know that, so they bring in a Bill to utilise the taxpayers' money to finance him to do a bit towards solving this social problem. That is what the Bill is doing.

I believe every hon and right hon. Member opposite is really anxious to get rid of this top-heaviness in our social structure. A great friend of mine is just as sincere when he says he does not want to drink, but someone has only to take him in and buy him a couple of drinks to start him off again.

The financial conditions laid down by the laws of commerce must be adhered to by those who engage in the productive process, and this Bill cannot fill the gap. Very often the gap gets wider. I do not believe that within ten years this Bill will solve the problem of the disparity between employment conditions in Scotland and conditions in the Midlands and the South. If in five years we reach full employment in Scotland there will be twenty jobs vacant here and one man looking for them. The B.M.C. is coming to Scotland, but the space vacated in Birmingham will be occupied and developed for a further spurt in production at that point. The labour is going to be retained there; it is not coming to Scotland, except for selected skilled labour. We shall not reduce the pressure here, but maintain employment here. There will not be a movement of population as well as absorption of unemployment in Scotland. I do not believe the problem can be solved unless there is relief of the pressure here and an increase of pressure in Scotland.

I hope the President of the Board of Trade can assure us that when he is considering an area like the North-East Coast, Wales or Scotland, where there is terrific dependence on industries which are entirely capital producing, in making his various contacts and moves to induce industries to go to those areas he will do what he can to look for industries which are not in their nature producers of capital goods but producers of all the smaller merchandise and consumer durables which enter the domestic market and the export market. If he can do that there is a greater chance of a more equitable distribution of economic activity in the country than if we rely entirely on producer-consumer industries.

11.39 p.m.

Mr. Stanley McMaster (Belfast, East)

I should like to say a few words of welcome for the Bill. I do not share the pessimism of the hon. Member for Dunbartonshire, East (Mr. Bence). I think this Bill may well be successful in its inspiration of spreading employment throughout the areas of the United Kingdom which are experiencing and have experienced persistent high unemployment.

In their economic planning and in their decision to introduce the Bill—perhaps the most important Bill in the present Parliament—the Government are making a brave attempt to solve this terrible problem, which is a social as well as an economic problem. What greater wastage can there be than to have trained and skilled men in various parts of the country, where the pattern of employment is changing, who cannot find other work when their industries contract? This method of combating unemployment and of spending public money in encouraging industry to go to these areas is perhaps the most sensible way in which the taxpayers' money can be spent. In exercising his powers under Clause 18 and in granting industrial development certificates, I hope that the President of the Board of Trade will remember the high unemployment in Northern Ireland. I hope that he will remember that unemployment there has recently risen to 8 per cent. I have had the unpleasant news that in my constituency 1,200 skilled engineers who are working in the aircraft factory of Short and Harland are to be laid off. With 8 per cent. unemployed, it will be very difficult for these men to find other work in Northern Ireland. I hope that in exercising his powers under Clause 18, which allow him in granting industrial development certificates to pay particular regard to the need for providing appropriate employment in the localities mentioned in Clause 2—which unfortunately is restricted to Great Britain—the Minister will not forget the rest of the United Kingdom. I hope that he will not forget Northern Ireland. In our shipbuilding and aircraft industry we are very vulnerable to this scourge and this great wastage.

I wish my right hon. Friend every success in this attempt to deal with the problem. I hope that the economic planning of the whole country, which our party has accepted, will be successful in making the maximum use of the available resources throughout the United Kingdom in order to raise the general standard of living and the prosperity of the country.

11.43 p.m.

Mr. Dempsey

It can be said that since the Bill was introduced into the House there have been some material improvements in it. I have attended practically every sitting on the Bill, because my constituency is deeply concerned about the operation of the Bill.

I was happy to see that Minister introduce the word "diversification," for unless we have diversification of industry it will become impossible to provide adequate employment prospects for both the male and female insured population on the register. In most of our areas the old basic industries are contracting, and it will be necessary to replace them with diversified industries to compensate for this loss of employment. If the Minister is anxious to apply the principles which he outlined to us and which he mas incorporated in the Bill, he will find that the inclusion of the word "diversification" will assist greatly in his efforts.

I was also delighted to notice that he still defended the need to provide for both grants and loans to be included of the Bill. Only when living in an area of considerable unemployment can one really appreciate the tremendous difficulty of inducing industrialists to move from the South to such areas. In some circumstances, it can be accomplished by loans; in other circumstances, it can not possibly be done without grants. I am glad, therefore, that the right hon. Gentleman has insisted on retaining provision for both loans and grants as a working element in ensuring that the Bill has some measure of success.

I am also glad that the President of the Board of Trade is very keen on the Clause 5, which deals with the clearance of derelict sites. The underlying intention of Clause 5 (1) is that work can be done with a view to improving amenities in the neighbourhood. That is the purpose of Clause 5 (1). As requested, I intend to be really optimistic about this provision. I believe that the right hon. Gentleman could use that provision very effectively to assist communities in the elimination of eyesores.

I hope that one of the first results of his generosity will be the tackling of the Monkland Canal at Coatbridge; that we will receive a substantial grant to remove what is not only physically unsightly and obnoxious to the nostrils, but an obscenity which is a menace to the community's health. That objectionable stretch of disused waterway passes through a community of 53,000 people. In being optimistic about this, I say to the President of the Board of Trade, "I am sure that your intentions are good and your desires honourable. By making a substantial grant towards the removal of this nuisance you will make a name for yourself, and your Bill in my constituency.

It is also good to know that, according to the right hon. Gentleman and the Parliamentary Secretary, we are to tackle the unemployment problem really earnestly. I am not unmindful of the good news that was recently proclaimed for one part of Scotland. We are grateful to the right hon. Gentleman for his co-operation in this respect, but I ask him to remember that we are looking for 90,000 jobs in Scotland—not 4,500. I know it is a tall order, but it is indicative of the nature of our problem.

The County of Lanark is looking for 10,000 jobs. North Lanark is the hardest hit place in West Scotland, at intervals unemployment there being as high as between 11 per cent. and 12 per cent. of the insured population. If the President of the Board of Trade could, through the operation of the appropriate Clauses of this Bill, steer a car industry into North Lanark to give employment for 4,000 to 5,000 workers, and could also create the prerequisites for attracting ancillary industries, I can assure him that in those parts both he and this Bill would go clown in the annals of our history for having achieved such a remarkable record of success.

I appeal to him to ensure that the provisions of this Measure will be operated irrespective of whether there is likely to be any obstreperousness from other sections of the Government. That is a very important qualification. Quite apart from the financial machinations that arise—and they will be many—I have no doubt that when we make application for certain grants we will be told by the Treasury that the country is in a state of poverty, that the Treasury itself is on the verge of bankruptcy—and, eventually, that we have never really had it so bad. After hearing the right hon. Gentleman's promises and his arguments for the Bill, I think that he will be prepared to fight against any obstacles or difficulties put in his way by the Treasury.

I return to a plea which I made to the Parliamentary Secretary and to which he did not reply. I hope that the right hon. Gentleman will give us an assurance, which he refused to give earlier, about the activity of other Departments with their own responsibility and authority—that such Departments will ensure that other aspects of industrial development for which they are responsible will be fully effected. I refer to the need for someone to speak on behalf of the Scottish Department of Health. I ask the right hon. Gentleman to undertake to acquaint the Secretary of State for Scotland with the terms of the Bill, so that that right hon. Gentleman will know what we have been doing, in order that when we make our representations for houses for industrial workers, he will be able to approve them immediately, understanding that such is the intention of Parliament. I am not trying to be facetious, insulting, or in any way offensive to the Secretary of State, but we have bitter experience of the operations of the Scottish Office North of the Border.

The President of the Board of Trade and his Parliamentary Secretary have said that the powers provided by the Bill will be sufficiently effective to enable them to deal once and for all with the sad and tragic problem of unemployment. We have discussed the Bill for several days and I am very glad to have had the opportunity to participate in these discussions, because I come from an area which suffers bitterly from this problem and, though lacking in Parliamentary experience, I understand the unemployment problem and hope that I have been able to make useful contributions to the discussions. I am concerned always with policies and not with personalities, but the Bill puts the right hon. Gentleman and his hon. Friend on trial. I hope that they will acquit themselves well and ensure the success of an admitted effort to eliminate this serious social problem from our midst.

11.53 p.m.

Mr. T. Fraser

We are very near to the end of our House of Commons consideration of what right hon. Gentlemen opposite have described as the major Bill of this Session. It is a Bill which many hon. Members opposite have regarded as giving the President of the Board of Trade power which he had hitherto not possessed to assist areas which he could not hitherto assist. However, the right hon. Gentleman knows full well that his supporters are gravely mistaken in their assumptions.

The Bill does not provide the right hon. Gentleman with additional powers. He was just as free under the Distribution of Industry (Industrial Finance) Act, 1958, to give areas not scheduled under the 1945 legislation all the financial assistance which he could give for the promotion of industrial activity leading to increased employment. In earlier debates, the right hon. Gentleman himself made it clear that the proportion of the population which he expects will be included in the list which he is to publish will be broadly similar to the proportion of the population covered by the now existing D.A.T.A.C. list.

The new list which, we are told, will come out next week and which, according to the Parliamentary Secretary will be the B.O.T.A.C. list, is surely the D.A.T.A.C. list of this week. We shall be very surprised if it is different. It will be different only inasmuch as the level of unemployment has moved a little between one area and another since then. Of course, there are development districts, but they may not then be B.O.T.A.C. areas. Development districts, according to the definition given by the President of the Board of Trade in an earlier discussion of districts that are to be assisted by him, will, in fact, be those parts of the country which he has listed under the Act of 1958. some of them inside and some outside the areas scheduled as Development Areas under the 1945 Act. So that all that is new in this major Bill—this bit of revolutionary legislation—is that the right hon. Gentleman will be able to give to an industrialist in one of these listed areas a grant of 85 per cent. of the difference between the cost of building his factory and the value put upon it by the district valuer at the time the application for the grant was made, which is some time before the district valuer is able to have a look at the factory, because obviously it is long before the factory is built.

One is bound to say to the right hon. Gentleman as we conclude our deliberations that it is a pity that he should have kept us in the dark about his list until a week after the Bill leaves this House. Members of another place will have the list before them, but they do not represent constituencies or have constituents as we do. It is a pity that they are given a facility that has been denied to Members of this House by a Minister, one is bound to believe, who considered it impolitic to let us have the information we should properly have had in considering whether or not to allow him to scrap all the distribution of industry legislation passed since 1945, with all the provision for scheduling, and to give us this Bill in its place.

However, if the President feels that he would rather solve the problem of local unemployment by this Bill then we must defer to his wish. If he is determined to solve the problem and would prefer to do so under this Bill than under existing legislation, we cannot object. The important thing is that he should have this determination.

The Parliamentary Secretary uttered some words about the new policy on rents. He told us this evening that as from Monday of this week, 1st February, the rents concession announced more than a year ago was withdrawn. That means that as from Monday the rents to be determined for factories owned by the Government in those areas listed for special assistance because of the high level of unemployment will be the market value rents as determined by the district valuer. I think that is true.

I hope that hon. Gentlemen realise what the position is and how much Government finance has gone into the alleviation of unemployment in those socially distressed areas. The biggest of them is Scotland. The Board of Trade has invested in all the Government factories in the Scottish Development Areas £25 million over twenty-five years. This is not taxpayers' money given away. Over twenty-five years £25 million has been invested in industrial buildings, every one of which is making a return in rent to the Government. By charging the market value rent today for many of those factories the right hon. Gentleman is making a substantial profit on the investment.

That should be borne in mind when hon. Gentlemen talk about the expenditure involved in taking industry to parts of the country where it does not want to go. No one can conceivably compare this kind of investment with the granting of £30 million or £50 million to re-organise the cotton industry. This is an investment all along the line which, by the policy announced by the Parliamentary Secretary in moving Third Reading, is calculated to return a profit to the President of the Board of Trade as the owner of the factories.

Mr. J. Rodgers

It is not an economic rent.

Mr. Fraser

The right hon. Gentleman will not make a profit on the factories that he built last year, but he will make a substantial profit on the factories built before the war and he will make a very substantial annual profit on those factories built by other Government Departments for war purposes and then handed over to the Board of Trade after the war for the purpose of the Distribution of Industry Act.

We should get this matter into perspective. A large amount of taxpayers' money has been spent on the implementation of distribution of industry policy. There is much misunderstanding about this. If the right hon. Gentleman believes that I am wrong in any of my figures, particularly about the figure of £25 million spent in Scotland over twenty-five years, I hope that he will correct me later. I must warn him that if he does he will be contradicting the figures I obtained from Scottish Industrial Estates Limited a little while ago.

The right hon. Gentleman has a big job to do. I will not labour Scotland's problem too much, because we have heard much about it. It is serious. We still have 98,000 unemployed, and the figure is rising. I have said much about the industrial parts of Scotland.

I will now say a word about the parts of Scotland which were by-passed by the Industrial Revolution. I mean the northern part of Scotland, the Highlands, the far north, the part of the country represented by the hon. Member for Caithness and Sutherland (Sir D. Robertson), who is not with us at this late hour but who has been with us most of the time we have been considering the Bill. In Caithness at the Wick Employment Exchange 12.9 per cent. of the insured population are registered as unemployed. In Sutherland at the Thurso Employment Exchange 8.6 per cent. of the insured population are registered as unemployed. This is the part of the country that has suffered more depopulation than any other part in recent years. People have been pouring out of the area for a long time, and yet it still shows these high figures of unemployment. Although the powers that the right hon. Gentleman has taken in the Bill are a repetition of existing powers, I hope he will feel that the powers he now has will enable him to deal with an area like that.

I should like to give another two figures to show the difference between the position in Scotland and the position elsewhere. We are concerned about the opportunity of employment for young people. It is bad enough for a middle-aged man, a man of 45, 50 or 55, to be out of a job and to find difficulty in getting another—

Mr. Charles Loughlin (Gloucestershire, West)

I appreciate my hon. Friend's wish to detail his examination of the position in Scotland, but we are dealing with a Bill which applies to other parts of the country with equally bad unemployment problems. Is he concerned solely with Scotland, or is he concerned with the Bill as it applies throughout the whole of the country?

Mr. Fraser

My hon. Friend has sat through a lot of the consideration of the Bill and he has heard me make a number of speeches on it. I would have thought that by this time he realised that I was interested in unemployment anywhere. Just as I should not be surprised that my hon. Friend should mention Gloucestershire in the course of one of his speeches, he must not be surprised if I mention Scotland. I have not mentioned my constituency, but I have mentioned the area that has 10 per cent. of the population and over 20 per cent. of the unemployment.

It is serious enough for the middle-aged man to be out of a job and to find it exceedingly difficult to get another, but it is much worse for the school leavers to find that they have no prospect of employment in the areas in which they live. Their only hope of getting a job is to leave home.

Mr. Bence

And leave Scotland.

Mr. Fraser

Yes, but they have to leave their homes and their parents and go away. That, unfortunately, is the position.

I take the figures that one finds in the Ministry of Labour Gazette and in the Digest of Statistics published by the Board of Trade. One cannot take every small part of the country, because they are not all listed, but I compare the region of Scotland with the region called the Midlands, with, broadly speaking, the same population, although the size of population does not matter for this comparison. In Scotland, in December, there were 22 notified vacancies for every 100 unemployed boys under 18 years of age; there were five unemployed boys for every job. In the Midlands, however, there were 1,700 vacancies for every 100 unemployed boys. So that in Scotland there were five unemployed boys chasing every available job, whereas in the Midlands seventeen jobs were chasing every available boy.

That is the difference between two parts of the country. That is why I should be failing in my responsibility if I had not called attention to the need for the powers given in the Bill to be vigorously implemented in favour of an area such as that. And in this area where there are seventeen jobs chasing every unemployed boy we have, despite what the B.M.C. is putting into other parts of the country, new capital investment by B.M.C., according to newspaper reports, of £26 million. Is that not right? The President of the Board of Trade says, "A jolly good thing." I say that in this area where seventeen jobs are chasing every unemployed boy there is still now to be a further £26 million of capital investment, and the President of the Board of Trade says, "A jolly good thing." He was inviting us yesterday to throw our hate into the air because we should be delighted because in Scotland, where there are 98,000 unemployed, and five unemployed boys chasing every job, there will be £9 million of capital investment.

Mr. Maudling

May I add once again that the new jobs being created by the B.M.C. scheme will be outside the Birmingham area, and that the new investment in the Birmingham area will greatly increase the productivity of the existing labour force? Surely to goodness that is in the interest of the whole nation, including Scotland.

Mr. Fraser

I am not disagreeing with capital investment in any part of the country, but the right hon. Gentleman will agree that he sounded very much yesterday as though the only capital investment that was being made at this time by B.M.C. was in Scotland and that we ought to be jolly pleased it was there. All I am saying now is that according to Press reports there will be some £9 million of capital investment in Scotland.

Mr. Speaker

Yesterday, we were not on Third Reading. We are now. Whether or not capital investment is going on in those companies in the Midlands has nothing whatever to do with this Bill. If the hon. Member relates what he is saying to the Bill, then I do not mind his saying it, but at the moment it seems to me he is not.

Mr. Fraser

With all respect, Mr. Speaker, I would point out that Part I of the Bill deals with positive steps which the President of the Board of Trade can take to assist areas where there is a high and persistent rate of unemployment and that Part II deals with the steps which he can take to discourage, or refuse assistance to, industrial development which will permit of further employment and further capital investment in those areas which are already congested.

But I leave this matter there now. In any case, we have had a long debate. There is not much point in our continuing it further; at least, I do not feel that there is any point in my continuing it further at this time of night.

There have been one or two pleas from both sides of the House to the President of the Board of Trade that he should influence his colleagues in the Government to secure that Government Departments will give some preference to development districts in the placing of contracts. I hope he has listened with sympathy to those pleas. I believe that Government Departments could do very much more than they do at present. It is the declared policy, and has been for some time, that they should give some preference. We do not want improperly to give support to incompetence and inefficiency, but I believe that a good deal more could be done than is being done. I believe that the nationalised industries could follow suit. I believe that they have not played the part they could in supporting industry in the difficult areas. I believe that local authorities, too, could do a great deal more than they do at present.

We are delighted to give to the President of the Board of Trade the powers which are contained in the 1945 Act of nearly fifteen years ago, albeit he has insisted in having them dressed up in new clothing. The important thing, however, is that he should use the powers.

Despite the exchange we had just a moment ago, let me say this as I sit down. I believe that the right hon. Gentleman wishes to use the powers. I believe that there is a far better chance of those powers being exercised now than there was, a better chance now that he occupies his present office than ever there was when his predecessor was in the job. I never had any hope then whatsoever. The right hon. Gentleman who then held the office knew that very well indeed. However, I think a great many of us believe that the right hon. Gentleman really does wish to make a large contribution towards the solving of the problems that have been so very much in our minds during the consideration of the Bill. I can safely say on behalf of my right hon. and hon. Friends that we wish him well in this task, and we therefore give our blessing to the Bill as it leaves us.

12.16 a.m.

Mr. Maudling

I am grateful to the hon. Member for Hamilton (Mr. T. Fraser) for the blessing that he has given to the Bill, though I expect that in his view it is still inadequate. Once again, I will certainly accept that the test of the Bill is not so much the text of it but the effect it has when the powers are implemented.

I shall try to deal as briefly as I can with the various points which have been raised in the course of the debate. A number of hon. Members have referred to the fact that many Government Departments are concerned in this problem. That is perfectly true. That is one of the reasons why the Bill, though presented by the Board of Trade, is supported by the Secretary of State for Scotland, the Minister of Housing and Local Government and Minister for Welsh Affairs and other members of the Government; and, of course, in all these matters the Government act as one.

To my hon. Friend the Member for Tynemouth (Dame Irene Ward), who was concerned about the shadow of the Treasury falling over my shoulder, perhaps I can speak as gamekeeper turned poacher in these matters; I can tell her that if she is asking questions about the carrying out of the Bill she should direct them to the Board of Trade because it is our responsibility not only to take action but to obtain the necessary consent of the Treasury to the carrying out of that action. If she has any rocks to throw, we are the target.

The question of the concessionary rates was raised by the hon. Member for Aberavon (Mr. Morris) and the hon. Member for Hamilton. This is not a new announcement. I should point out that when my hon. Friend the Parliamentary Secretary announced the creation of the concessionary rates over a year ago he then said specifically that this was a special arrangement only to last for twelve months. What he said this afternoon merely confirmed what was said at that time.

My hon. Friend the Member for Crosby (Mr. Page) referred to the question of Government contracts. I should particularly like to take this opportunity of confirming that the Government preference scheme, to which he referred, will continue in its present form and apply to the districts which will be specified under the Bill.

The hon. Members for Gower (Mr. I. Davies), Jarrow (Mr. Fernyhough) and Coatbridge and Airdrie (Mr Dempsey) referred to the powers for dealing with derelict areas. We certainly believe that the new form of the Bill will widen our powers in this regard which so far have been restricted by the legal definition of "derelict" as being "ownerless and abandoned". I should make it clear once again that as this is a Bill to deal with local unemployment it does not give us powers to remove slagheaps and so on simply for the sake of amenity but only where doing so will contribute to the basic purpose of the Bill, namely to make the area more attractive to industrialists to go into it and create employment. I share the views of hon Members that there may well be cases—I will not refer to any particular example—where the use of these powers may be of considerable value.

I have one or two words to say to the hon. Member for Kilmarnock (Mr. Ross). He and the hon. Member for Hamilton referred to the B.M.C. scheme I must pay tribute to the British Motor Corporation for what I think is the very public spirited attitude which it has adopted. Its new big expansion is being spread over the country as a whole, taking place in Birmingham, Scotland, South Wales, Merseyside and Swynnerton.

The real thing that we are concerned about is the creation of employment. The scheme which the Corporation put forward, on the basis of which we have granted it I.D.C.s, provides that all new employment will be created outside the Birmingham area. At the same time we have given the Corporation I.D.C.s for expansion in Birmingham which will mean the creation of greater amenities and the reduction of overcrowding in its Birmingham premises without increasing the existing labour force, and, secondly will mean that with the existing labour force the Corporation will be able to make a great increase in productivity. Therefore, there will be a great strengthening of its competitive position particularly in the overseas markets. I should have thought that satisfactory both from the point of view of the country as a whole and the areas where employment is required. On the one hand, the country will get the benefit of the increased competitive power of the Corporation and on the other, all the new employment which is created will be outside the crowded Birmingham area. I was a little disappointed that the hon. Member for Hamilton was, possibly, a little grudging about it.

Mr. T. Fraser

I think I speak for all my hon. Friends when I say that we were delighted about the B.M.C. development in Scotland. The thing which has annoyed us a little is the impression we got that the Minister, and certainly the supporters of the Government, felt that because this thing has happened, Scotland's worries are over. That is not the position.

Mr. Maudling

Certainly I agree that any such impression would be nonsense. This is just a beginning. I hope that ancillary firms and the makers of components will follow and, in so far as the hon. Member for Hamilton is expressing that hope, I accept his point of view.

I was not so surprised at the hon. Member for Kilmarnock and I should like to address a word or two to the hon. Gentleman. Having listened to many of his speeches during the passage of this Bill, I cannot think of any series of speeches more calculated to damage the true interests of Scotland. It seems to me that any non-Scot foolish enough to attach importance to the mixture of threats and discourtesy that comes from the hon. Gentleman would think not only twice, but three times, before going near Scotland with his enterprise.

I assure the House that the Government will continue to base their policy in these matters on what the hon. Member for Hamilton so rightly said about the very high level of unemployment in Scotland, because it is the motive of the Government to try to cure this problem. My hon. Friend the Member for Belfast, East (Mr. McMaster) raised an important point. I should like to confirm, whatever is said in the Bill—and he was right on the narrow point of what is in the Bill—that in operating the I.D.C. system we shall certainly bear in mind not only the unemployment requirements in Great Britain but in Northern Ireland as well, and I am glad to have the opportunity of confirming that.

As has been announced by my hon. Friend, we shall shortly be publishing an initial list of districts. There will be room to add more if conditions require because we have not yet finalised it. But, in any case, it would not have been appropriate to publish the list before this Bill had completed its passage through the House of Commons, because there is here a change of conception. Under the earlier legislation the House of Commons determined that certain areas should be given special treatment. This Bill changes the conception to saying that any area qualifying by certain criteria shall be entitled to certain benefits and those areas therefore will change from time to time This is not Parliamentary determination of special areas, it is Parliamentary determination on a general principle to be applied administratively.

I hope very much that in dealing with these matters we shall try to avoid controversy between one district and another but I am quite certain that in practice we shall not be able entirely to do so. In recent weeks I have become aware of the great difficulty which arises here. Clearly, there are fewer companies coming forward, which are available to be guided into these areas of unemployment, than we require to satisfy the needs of everyone. Therefore there is competition between Merseyside, the North East Coast, Scotland, and Wales for the available new enterprises. We shall do our best to avoid any discrimination all round. I assure my hon. Friend the Member for Tynemouth that although there is no Secretary of State for England—I sympathise with her point of view in this matten—I have taken great pains in discussions with industrialists to point out the importance of the North East Coast and particularly the availability of skilled labour in that area. The fact is that we must recognise that we cannot direct people to go to particular places. I think that is accepted on both sides of the House. If industrialists are prepared to go to an area where there is a really serious problem of unemployment, I do not see how we can refuse to give them the support to which they are entitled under the Bill for doing so.

We must be careful not to take decisions on the basis of whether a place is in Scotland, England or Wales. It is true that there is a special problem in Scotland, but it is a special problem, not a Scottish problem, special because of the remoteness and the figures of unemployment there. Probably Anglesey could produce similar figures. I make the plea again that we should treat it as a special problem and not as a Scottish problem. If we do that I think we shall reach the desired conclusion.

I do not think there is anything more I need add. On many occasions in the House and in Committee I have explained the basic purpose the Government have in the Bill. I know that members of the party opposite do not feel that it contributes very much to the legislation of the country. I accept that they feel that, but the point is that we now have the powers to do the job and we wish to do it.

Mr. Dan Jones (Burnley)

May I ask the President of the Board of Trade a question in relation to Clause 3 (1). which deals with building grants? Will that apply to old cotton mills which may be suitable for new industries? Would the financial grants apply to reconditioning to get a new form of industry?

Mr. Maudling

It would depend whether the process could be related to the words in the Statute as providing in the locality buildings or extension of buildings". I should have thought not. On the whole I am rather doubtful, but I should not like to be dogmatic about it.

Question put and agreed to.

Bill accordingly read the Third time and passed.

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