HC Deb 03 February 1960 vol 616 cc1060-76

Amendment made: In page 3, line 33, leave out from "in" to end of line 35 and insert "a development district".—[Mr. J. Rodgers.]

Viscount Hinchingbrooke

I beg to move, in page 3, line 42, to leave out "or grants".

I had hoped to deal with the elimination of grants and the substitution of loans throughout the main spending Clauses of the Bill, namely Clauses 3 and 4, but for technical reasons the Amendments were out of order on Clause 3, and I am confined to this Amendment and the next Amendment in page 4, line 5, leave out "or grant", which is consequential. These are second-line Amendments. They are not attempts to wreck the Bill but they are attempts to hamstring its activities somewhat.

For the benefit of hon. Members who do not know the nature of my opposition to the Bill, and without going out of order, I think I should say quite briefly that while not being opposed to State action in some form, either general or particular, to alleviate unemployment in certain localities—and I am thinking particularly through the Ministry of Housing and Local Government by way of clearing and altering the character of the locality and employing labour, improving amenities and activities of that kind—I am totally opposed, as are some of my hon. Friends, to the giving of State assistance to private business to open up in places where there is alleged to be a sufficient qualifying degree of unemployment. I am opposed to that, first because it discriminates between the new private entrant to the locality as against the existing business man in the locality who, as I pointed out to my hon. Friend the Member for Tynemouth (Dame Irene Ward) the other day, has been "sweating it out" there for a generation or more, and also because it discriminates as between the lucky firm which gets this Government assistance and the competitor in the same trade who does not get it or does not elect to seek it.

I deplore the fact that the present Conservative Government, in so many fields which I cannot cover in this Amendment, are today subsidising private industry either to go to places and do things or to amalgamate—

Mr. J. Griffiths

And agriculture.

Viscount Hinchingbrooke

I entirely agree with the right hon. Gentleman. I think that some of the subsidies to agriculture are in need of surveillance and in some cases severe curtailment. I say that in spite of the fact that my constituency, while not being purely agricultural, is largely an agricultural constituency. However, this being a second-line Amendment, I cannot develop the point.

It seems to me to be a mistake to use the taxpayers' money to aid and abet the arrival of industry in areas which are already heavily industrialised by definition, because otherwise unemployment in those areas would not arise. The concept that I have is one of decentralisation on the lines of some of the things that are now being done abroad, notably the tremendous Renault factory in the heart of rural France, and in my own constituency where Winfrith Atomic Energy Station is not surrounded by a large industrial conurbation but employs large numbers of persons. That is the type of concept that I have, and, for the reasons that I have given, I deplore the use of taxpayers' money to pay grants or loans to private enterprise in order to aid and abet the process of massive industrialisation in areas where these "dark satanic mills" have existed for too long.

The basic question here is how to save something of the taxpayers' money without destroying the concept of the Clause infernally. I am therefore moving to leave out these words "or grants." The purpose is quite simple. The State might consider making a loan to private enterprise, as it has done in the past to various iron and steel firms—notably Tube Investments which firm is now in Corby, and the Cunard Shipping Company for the building of the "Queen Elizabeth" and the "Queen Mary". This has been done by means of loans which are repayable I hope that there will not he a grant for the new "Queens". If any assistance is given, it should be done by means of a loan and not by a grant.

Here we have a proposal to make available very large sums to private industry to move to areas of unemployment, and if these sums are to be available they should be made available in the form of loans repayable over a period rather than by means of grants. If a grant is made of, say, £100,000 for a large industry to move to an area of relatively high unemployment, that comes above the line on the Estimates. It is paid for out of current taxation. If it is a loan it may qualify to go below the line. It is repayable and the sole feature of it which reflects against the taxpayer is the annual interest.

6.30 p.m.

Many concerns can go to their banks and, by paying 4 per cent., 5 per cent. or 6 per cent., can get a sizeable industrial loan. By coming to the State they get it at whatever the lending rates are at the time, 4½ per cent. or 5 per cent., and there is a minute difference between the two. We should not quibble about the difference in what private enterprise can get from private sources and from the State. My main point is to try to reduce the large sums, directly payable by the taxpayer to industry.

The Government may come forward with two counter-arguments. They may say the alternative to making a grant is for an industry to request that a Board of Trade factory should be erected for it. That in part begs the question, because I cannot see any responsible Government acceding to the request to build a very expensive factory for a firm if a grant was not there. Secondly, they may say this is a once-for-all payment for a firm to uproot itself, travel, get settled, re-tool and get going again, and after that it is off on its own. That is only a "little baby" argument, because no other private firm that has moved to a centre which has had unemployment in the past, until the 1945 Act came into existence, has had Government assistance for this purpose. Hitherto industrialists have been required to raise capital for their initial establishment expenses. Many firms are doing that at present. If the Government argue that this is a once-for-all payment, I do not think that mitigates the enormity of their offence under this Bill sufficiently to allow it to pass. Where are we going with these grants and loans to private industry? I hope very much for the assistance of some hon. Members opposite in attacking this problem fundamentally as we proceed to our financial debates throughout the year. It is interesting that some of the great men of commerce are beginning to have feelings of very sincere regret about this. I know that the hon. Member for Ashton-under-Lyne (Mr. Rhodes) is deeply interested in the processes now at work in the cotton industry. Perhaps he will be interested in what Mr. Anthony Tuke said on 18th October last to the Annual Conference of the Cotton Board: At the moment you have your special problem of redundant capacity, which is so serious that the Government have been prepared to take special measures to alleviate it. I need hardly tell you that this action has not met with universal acclaim. I only say one thing about it, which is that Government financial aid, whether by grant or by loan, can act as a boomerang. In particular its acceptance, especially I think if it takes the form of a loan, provides an argument, perhaps the only plausible argument, in favour of nationalisation, which is that industry is now so big that when it needs finance only the Government is big enough to find the money; and that what the Government finances it is entitled to control. I make this as a general point, and not as having any special reference to the cotton industry.

Hon. Members

Hear, hear.

Viscount Hinchingbrooke

Hon. Members opposite need not cheer so loudly. I made exactly the same point myself in my peroration when opposing the Second Reading of this Bill. I ask the Government again to recognise the danger of this process of chasing industries, in a certain stage of temporary decline it may be, with subsidies and grants. It may please hon. Members opposite. This may be a form of Conservative philosophy which is feeding their ultimate purpose. I do not know. Goodness knows what the Minister of Aviation is doing to the aircraft industry. We might very well soon get to the stage where it will be natural for people to demand that it is the duty of the State to invest in, take over and manage industries which have been the subject of so much Government help.

I hope the Government will take a warning from the fears that some of us are expressing about current legislation at the present time. It is extraordinary that, while the Russians now seem to be developing various arts of private enterprise and private commerce, even in a rudimentary way, we in Britain remorselessly, for some extraordinary reason, since the war have been moving towards collectivism. No doubt one day we shall salute each other as we pass, both of us at sea.

Mr. John Eden (Bournemouth, West)

I beg to second the Amendment.

In the course of his remarks, my noble Friend showed that the payment of grants by the Government is undesirable. I hope in one or two sentences to show that it is equally unnecessary.

The one purpose of the Bill, I understand, is to induce industry to move to areas where there is a high and persistent rate of unemployment, hoping that by moving fresh employment opportunities will be created in those areas. The accent so far in our discussions, both in Committtee and today, has been on the word "induce". This is one of the methods by which it is hoped to induce industry to go to those areas. This form of inducement, the payment of a grant, is, in effect, designed to amount to compensation for the expense of moving. If it is to compensate an industry for moving from one area where it now exists to an area where the Board of Trade wishes it to go, this is not going to be the only consideration which the owners or managers of that industry are going to have before them when deciding whether or not to accept the invitation to move to that area.

I imagine that, on the whole, it will be one of the smallest of the considerations they will bear in mind. Their main consideration, surely, will be whether or not, after having settled in that new locality, they are going to be able to trade successfully, to produce their particular articles economically and to market them efficiently. One of the smallest factors in their minds when weighing up the various arguments in favour of moving or staying will be this question of compensation for the cost of actually moving and setting up in the new locality. It is not going to be the one big point which will persuade people to move who otherwise might not be prepared to do so.

In any event, I think it will be unnecessary because in trying to consider which industries are likely to move I think they are more likely to be the larger concerns. I cannot foresee many small industrial companies, or even groups, running the risk which undoubtedly a move of this kind would involve. It is much more likely to be those which we regard as the leaders in British industry, which hitherto have taken a lead in doing this sort of thing, big firms which have gone to these areas and saved the situation by creating fresh employment opportunities there. They have been followed by the smaller firms, like smaller fish following big fish. It is the risk, which the big fish can well afford to take, which is the first and foremost one. Therefore, it seems to me to be unnecessary to exercise this power of administering grants.

In fact, my right hon. Friend has said so in the Bill. In Clause 4 he makes it clear that there must be some test before a grant or loan is given, and the test is to be whether or not it is assumed by those administering the money that the industrial concern will be a success. Clause 4 (1, b) says that there must be good prospects of the undertaking ultimately being able to carry on successfully without further assistance under that provision. If there are good prospects for the concern to carry on successfully, it seems unnecessary for it to be in receipt of any form of grant. If it can carry on successfully, then it can be expected to be successful enough to repay the loan. Consequently, it is essential that we should remove from the Bill this imposition on the taxpayer.

I think it will help to some extent—a little, not much—to encourage a certain amount of movement in the labour force. I have very much sympathy with and understanding of the arguments put forward at earlier stages of the Bill about the preservation of the life of the community, but I think it is true to say that there is not today as much mobility of the labour force as there was. I believe that the labour force has been rendered immobile by the settlement of wages on a national basis. Therefore, I would hope that such money as can be spent under the Bill will be directed towards encouraging individual potential employees to move from one area to another rather than towards grants to individual industries.

6.45 p.m.

Mr. H. Rhodes (Ashton-under-Lyne)

Since the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) mentioned me, I should like to tell him that I support a good deal of what he said. We now have the example before us of the mess that the Government have made of the grants to the cotton industry. When one looks at these things it depends, of course, how they affect one. If one is at the receiving end it is not so bad. I was hoping that the Government would, perhaps just before the next General Election, apply to the wool industry a scheme similar to that which they have put into operation for the cotton industry, because it is very nice occasionally for those engaged in industry to get something for nothing.

I would urge the Minister to consider the question of grants and also what the noble Lord has said. Just before the General Election the Government brought in their scheme for the cotton industry, and as a result vast sums of money have been paid, estimates varying between £30 million and £60 million. As the area concerned is a D.A.T.A.C. area, it is still possible for a firm to apply to the Treasury for permission to set up again in the same business. Hon. Members must consider the matter not just in terms of political expediency at a time when a General Election may be pending so that the Government of the day may be helped to keep seats which they would otherwise be likely to lose; they must look at it in terms of how it will build itself into the fabric of the economy as a whole. There is something in what the noble Lord has said, and it ought to be very seriously considered. I look forward to co-operating with him at a later date on the same sort of issue.

Mr. Anthony Fell (Yarmouth)

I support the Amendment. I am not sure whether it is a concomitant of democracy that one must do the wrong things for the wrong reasons practically all the time, but on the question of these grants it seems to me that it is easy enough to get a grant out of the Treasury for something which is generally politically acceptable to the voters. In other words, if there is a cry for pouring out some money that moves a Government strongly enough from the voting point of view they will pour it out, but they very often think twice about granting money for what may be more important purposes.

Mr. Willis

Are we to understand from the hon. Gentleman that he thinks that the Tory Government in the past nine years have been pouring out public money because it had a certain voting value?

Mr. Fell

I will not be drawn out of order by the hon. Gentleman.

Mr. Willis

That is what the hon. Gentleman said.

Mr. Fell

Perhaps there are other hon. Gentlemen opposite who would like to interrupt me. If so, I should be glad to give way to them.

Mr. Rhodes

I merely wish to say that I understand absolutely what the hon. Gentleman is saying.

Mr. Fell

It is perfectly true of any Government—it has been true of all Governments since the war—that they will pour out money for things which they think of political advantage, but they are loth to pour out money for other matters which may be of very great importance. Perhaps I may explain what I mean. This afternoon my hon. Friend the Member for Tynemouth (Dame Irene Ward) spoke about the East Coast. There are many ports, including one in my constituency, which were very much harmed during the war. Industry was practically driven away and the ports became more or less armed camps. Also, great damage was done to the towns. However, do hon. Members think that one could get a sizeable grant out of the Admiralty or the Government in order to repair the damage? Not at all. Yet had that been done in the case of my area— which may well come within the provisions of the Bill—it would probably have had the effect of making much of the provision of the Bill unnecessary in my constituency because it would have improved the town, made the port facilities better and brought revenue into my constituency.

I agree with my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke), when he says that he is frightened of unfair competition; in other words, the subsidising of private concerns in areas where others may be manufacturing the same sort of goods. There is that sort of subsidising of the one industry. There is also, the fact that this is gradually leading to a position in which there will be large holdings in many interests all over the country, which will simply make it easy for Socialism to nationalise those industries. It is one of the great dangers that may result from the Government granting money in this way to industries—for the best of reasons, but, I think, wrongly. It is opening the way to those industries becoming flabby so that, at a later stage, the Government will have to take control of them.

Nor does it help that, because of this Bill, a spirit is getting abroad amongst people who may recently have fallen out of work of, "Why should I bother? Let the Government bring work to me." I have already come across this among one or two people in my constituency, and I am sure that other hon. Members, if they were frank, would say the same. That is a serious trend, because if people are not prepared to search for work it is extremely doubtful whether our economy will be very sound in the future.

I hope that the Government will take some warning from the attacks promised on parts of their financial policy by my noble Friend. I assure the Government that there are quite a few of us on this side who are worried about the apparent trend—of course, we may be quite wrong —towards Socialist policies in our finance.

Mr. T. Fraser

During this discussion, I have gained the impression that some hon. Members have been seeking to convince the House that the present issue is whether or not the Government should give grants generally to private industries. That is not the case at all We are considering whether, in this Bill, the purpose of which—supported, I think, by Members in all parts of the House—is to deal with those areas where there is a lot of unemployment and real social distress, we should give authority to the Government to take certain action to protect the interests of communities which, generally speaking, have contributed largely to our economic wellbeing in the past. As I understand it, by writing into Clause 4 this provision about grants the Government are following the precedent of the 1945 Act, Section 4 of which contained provisions for grants and loans to industrialists in certain circumstances. The Parliamentary Secretary will correct me if I am wrong, but my recollection is that not many grants were given under Section 4, and I do not think that envisages many grants being made under this Clause 4.

Let us consider, for a moment, whether there are not circumstances in which it would be very highly desirable that the President of the Board of Trade should have power to make a grant. I think all Members will support the later provisions about industrial development certificates. There are some congested areas, and some congested cities in particular, in relation to which we would all applaud the President of the Board of Trade if he were to refuse an application for an I.D.C.

In some cases, and it is not difficult to imagine this, the employer in a congested area who is refused an I.D.C. is invited to carry on his new development or his extension in, say, an area of high unemployment. He might be in quite a small way. He could say, as very large employers like the British Motor Corporation have been saying in recent weeks, "It would be hopelessly uneconomic for me to divide my factory." The smaller employer could argue with very great conviction that it would not be economic for him—employing, perhaps, only 100, 200 or 300 workers—to carry on his activities in two different parts of the country, perhaps 200 or 300 miles apart.

He might very well say to the right hon. Gentleman, "I cannot divide my industry. If you do not let me have an industrial development certificate in this congested city, you are really telling me that I cannot extend my business at all." The President of the Board of Trade might ask, "Could you not take the whole of your industry into this other area?" The industrialist might well answer that he could, if he got some assistance.

Would not all hon. Members think it right that the right hon. Gentleman should give that industrialist the assistance he needs to take his industry from the congested area to the area of high unemployment, where he would carry through his expansion and employ, perhaps, another 100, 200 or 300 workers—

Mr. Rhodes

I am sorry to interrupt my hon. Friend, but I disagree entirely. What small employer, and I am one, will think of spending his life training his employees in a very specialist trade only to see them dispersed like that? It is ridiculous to say that, in his lifetime, he could build up the same kind of specialist labour. The analogy is not good enough. If an employer has been building up a specialist business during his lifetime, I think that he is entitled to an I.D.C., and entitled to develop in the area in which he has spent his life.

Mr. Fraser

I am afraid that my hon. Friend has not followed me—

Mr. Rhodes

Oh, yes, I have.

Mr. Fraser

I have not said that every employer in a specialised line of business who has a few specially-trained workers should always be refused an I.D.C., told to uproot himself and go elsewhere. Of course I have not. I have given an instance of what has occurred in the past. Employers have uprooted themselves, and they have taken their specially-trained workers to other parts of the country where houses and other accommodation have been specially provided for them.

If one wants to do anything at all to ease the great pressure of population on this great Metropolis, I should have thought that when we are spending millions of the taxpayers' money in building new towns and so on, we would not be averse to paying the removal costs of an industrialist going from here to unemployment areas in Wales, to the Merseyside, to north-east England, or to Scotland or elsewhere. It is the sensible thing to do. It is because I believe that it would be a great pity to deny the President of the Board of Trade the opportunity of doing this sort of thing that I hope that the noble Lord and his hon. Friends will not press the Amendment to a Division. In any case, I hope that the Parliamentary Secretary will not feel able to accept it.

We on this side are not asking that wholesale grants of public money should be made available to industrialists to go into those difficult areas. We accept at once that in the vast majority of cases no grants at all will be made but that, at the most, if they need capital, the industrialists will get a loan which they will repay over a period. That will be the general position. There is, however, the exceptional case, in which I think that all hon. Members would agree that a grant should be paid. It is, I hope, to cover the exceptional case that the Government have used these words and given the President of the Board of Trade this power. In those circumstances, we support this provision, and hope very much that the noble Lord's Amendment will not be widely supported.

7.0 p.m.

Mr. William Ross (Kilmarnock)

From one point of view, I am very happy about the stand taken by the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke). It is about time that someone gave publicity to the extent to which private enterprise is no longer quite so enterprising. To that extent we should be very grateful to him; but when we look at what he is trying to do we must bear in mind the purpose of the Bill. It is to bring employment to hard hit areas. I wish that the noble Lord or one of his hon. Friends had produced figures.

I have in my hand one or two figures given in an Answer on 17th December in relation to grants in Scotland, as compared with loans, under the financial aid provisions of the 1958 Act. Up to 16th December, which was well over a year after the passing of the Act, grants in Scotland amounted to only £8,250. Every one of them was to the counties of the Highlands and Islands—just the very places where it is most difficult to get industry going. If the money had not been available, it would probably have meant only 300 or 400 jobs, but they would have been very important jobs when compared with the prospects of obtaining employment in those areas.

I ask the noble Lord to think again about this and to appreciate that he is deliberately seeking to take from the President of the Board of Trade a weapon which can be useful in certain circumstances. As far as I understand the Clause, the grants are not to be handed over freely. Conditions may well be laid down for repayment. I hope that the Parliamentary Secretary will give us the figures for grants over the whole country so that the noble Lord may appreciate just how they have been given. I deplore very much indeed that in order to further a financial theory of his own the noble Lord is prepared to deprive such areas of much needed help.

Mr. J. Rodgers

The effect of the Amendment moved by my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke) and seconded by my hon. Friend the Member for Bournemouth, West (Mr. Eden) would be to prevent the Board of Trade making grants under Clause 4 for undertakings in listed localities and confine the assistance we can offer firms to persuade them to move to such areas to loans. The corresponding section of the 1945 Act gave power to make annual grants as well as loans. Therefore, the present Bill does not create any new power in this respect, save that single once and for all grants can now be made. Moreover, I ask my hon. Friends to remember that the 1950 Act contained in Section 3 (1) a power, not repeated in the present Bill, to make grants in certain circumstances towards the cost of transferring an undertaking to a development area.

It is expected that the new committee which will advise the Board of Trade in most cases will recommend loans rather than grants. The hon. Members for Hamilton (Mr. T. Fraser) and Kilmarnock (Mr. Ross) were right in saying that very few grants indeed have been made under the 1958 Act. The reason for that is that we want to steer to the new localities only firms which have a good chance of being viable and becoming going concerns when they are no longer in receipt of Government assistance. It seems to us appropriate in some cases to make a grant to a firm to cover its once and for all expenses of setting up in places of high unemployment. We believe that the opportunity of obtaining grants for that purpose will be a useful incentive in persuading firms to go to such areas.

To lose this power, as suggested by my hon. Friends, would substantially impair the usefulness of the Bill. The supporters of the Amendment have urged, as did my hon. Friend the Member for Yarmouth (Mr. Fell), that in addition to involving the irrecoverable outlay of public money grants given in these circumstances will give firms an unfair advantage over their competitors. If the grant is used as it is intended that it shall be—primarily to cover once and for all expenses incurred in moving from the area in which the firm is at present doing business to the new area—this will not be so. Its effect is only to offset the disadvantages from which the firm would otherwise suffer in moving. That is the purpose of Clause 4. I therefore recommend the House to reject the Amendment, unless my noble Friend can be persuaded to withdraw it.

Mr. Frederick Lee (Newton)

My hon. Friend the Member for Hamilton (Mr. T. Fraser) accurately put the case for the Opposition. On the other hand, this is a delightful Amendment. The noble Lord mentioned the same point on Second Reading. When I wound up for the Opposition I ventured to say that I agreed with many of the points he made. I still do.

We are now reaching the point where so many of the larger undertakings which are still in private hands are able to maintain themselves in that position only if they receive a State subsidy of some kind. This naturally, from his own philosophical point of view, places the noble Lord in a position in which he foresees the danger of nationalisation being the only alternative to State grants. There is no answer to it. The noble Lord's dilemma is one which neither he nor any other Tory can answer.

My hon. Friend was right in pointing out that, in the main, the firms to which grants are given are not in the category of the great private monopolies which the noble Lord mentioned, as I did recently, that the Minister of Aviation is now busy creating. The right hon. Gentleman is going round the country smashing down the competition of private enterprise and replacing it by private monopoly. Although the terms and conditions are not known, we all know that that is being done by Government patronage, by the promise of contracts, perhaps by direct grants of public money; or, conversely, to those which will not enter into such an agreement, by the threat of the withholding of contracts, and so on. The noble Lord is utterly right in saying that this is incompatible with Tory philosophy. I was pleased that on this issue he came back to what I am sure for him is a philosophical monstrosity, in that a Tory Government are conniving at that kind of thing.

I draw a distinction in this matter. The Bill envisages small firms still working under strictly private ownership, plying for profit. Yet we are asking them to uproot themselves and go to areas where there is the need for the provision of employment for unemployed people. I do not believe that the basis of the noble Lord's philosophical argument there applies. I am fortified in that by my feeling about the great motor firms which are going into certain Development Areas. I am very glad that they are. Some are going to Merseyside, and I am very glad of that. One has the feeling that the motor car manufacturers have sufficient financial strength not to have to depend on the Government to provide them with the finance to go to those areas.

This is a very great dilemma and I am sure that the noble Lord is utterly right on this point. If it were merely a question of that type of firm going into Development Areas I would support the Amendment, but, as my hon. Friend the Member for Hamilton pointed out, there are also the smaller firms which are financially incapable of making such a move without assistance. Where the once-and-for-all grant makes a difference to a firm's decision to move or stay where it is, I come down on the side of making the grant.

The hon. Member for Caithness and Sutherland (Sir D. Robertson) has a vast constituency. I cannot imagine many small firms being able to move from the Metropolis, or some other congested area, to the hon. Member's constituency to provide employment for people there unless they are given initial grants. It is precisely those isolated areas which are mostly in need of the assistance which the Bill will provide.

The noble Lord has raised an issue of which the House will hear a great deal for many years. We are now in a state of flux with this kind of matter. It is wrong and immoral that vast sums of public money should be allocated to private enterprise merely so that private enterprise can maintain private monopolies. We feel that once an industry has reached that position there is no alternative to public monopoly. I do not expect hon. Members opposite to agree with me about that, but that is the historical process which we are now seeing. I am very glad that the noble Lord has raised the subject, because I am very sure that the House will hear much more of the argument in the years to come.

7.15 p.m.

Sir David Robertson (Caithness and Sutherland)

The hon. Member for Newton (Mr. Lee), the hon. Member for Hamilton (Mr. T. Fraser) and the hon. Member for Kilmarnock) (Mr. Ross) all clearly indicated that these grants were mostly likely to go to places like the Highlands. I think that they are absolutely right. I have been working on the problem of trying to persuade successive Governments to attract light industry to the old Highland towns and large villages, because unless industry goes to those areas their populations will continue to go away. It begins with unemployment, goes on to depopulation, and ends in decay.

In the nine years since 1951, the Government have failed to attract industry. I sometimes think that they lack the will, and I have said so in the House before. We have the experience of the extraordinary development which has occurred in the Six Counties of Northern Ireland where, through wise legislation in the Northern Ireland Parliament, and supported by finance from our Exchequer and great assistance from the Board of Trade and other Departments, 70,000 new jobs have been created in rural areas.

My noble Friend the Member for Dorset, South (Viscount Hinchingbrooke) mentioned the Renault factory out in the fields in France. Henry Ford started the original Ford factory in the fields outside Detroit, because he believed that the finest labour would be the labour of agricultural workers.

Mr. Speaker

I ask the hon. Member to bear in mind what the Amendment is about. It is about the distinction between loans and grants in this context.

Sir D. Robertson

I am sorry if I have embroidered my case too much. It seems to me that this important matter was fairly stated by hon. Members opposite and particularly by the hon. Member for Kilmarnock who named the figure of about £8,000—under D.A.T.A.C., I presume—which had been given so far and which had all gone to the Highlands and Islands of Scotland. Undoubtedly, without that assistance there would have been very few means of attracting new industry. I quoted the Northern Ireland example because that has been a matter for admiration by all and the improvement in those rural counties has come about with the aid of grants similar to these.

I do not agree with what the hon. Member for Newton said about aviation. I remember the motor industry when there were several hundred motor manufacturers. In those days, we could export very little and the cost of motor vehicles was high and the most successful succeeded and the weaker went to the wall. Today, we have large groups of private enterprise firms which have not had a penny of subsidy from anybody, but which have been able to produce cheaply and to attract a great export market. We have every reason to be proud of our motor industry when we think of the cost of vehicles today.

It seems that such firms are going to Scotland, where they are so much needed and where new employment is needed, without grants. I believe that the bulk of industries will go to Lancashire and the populated areas—I do not think that my noble Friend need have any anxiety about that. However, to get firms into places where there is a serious maldistribution of population, I am convinced that the Bill is perfectly right in offering grants.

Amendment negatived.