HC Deb 13 July 1960 vol 626 cc1407-522

Order read for resuming adjourned debate on Question [12th July]: That this House takes note of the Reports on Industry and Employment in Scotland and on Scottish Roads, 1959–60 (Command Paper No. 1045).

Question again proposed.

3.56 p.m.

Miss Margaret Herbison (Lanarkshire, North)

We had a whole day's debate on this subject yesterday, and our point of view was admirably put by my right hon. Friend the Leader of the Opposition. He was followed by the President of the Board of Trade, and what an opportunity he had to give a cool, clear and logical appraisal of Scotland's economic situation. In the event, he did himself much less than justice.

I was interested to see what responsible Scottish newspapers had to say today about the debate. In one of them I find this: Mr. Maudling, President of the Board of Trade, who followed the Leader of the Opposition, has left the Secretary of State for Scotland with a formidable task in winding up the discussion unless some substantial news of Government action and intention is being held in reserve. That was not a Socialist newspaper, but what I would term the Tory Glasgow Herald.

The President of the Board of Trade, an economic and financial expert, gave us a completely topsy-turvy picture of what he expected would be the effect of the rise in the Bank Rate and the credit squeeze on Scotland's economy. I am sorry that the right hon. Gentleman is not present. His performance yesterday was sheer intellectual dishonesty, and he knows it.

The leader in the Glasgow Herald further states: The Local Employment Act came into operation on April 1st, three days before a 'standstill' Budget. Since then there have been an increase in Bank rate, the second this year, and further restrictions on credit—measures which bear more heavily on Scotland, with its relatively old fashioned industrial economy and a chronic need for diversification, than on the Midlands and South-East England where trade and employment are booming. That is the case which we tried yesterday to make to the Government. It was not accepted either by the Joint Under-Secretary of State for Scotland, or by the President of the Board of Trade.

We in Scotland can speak from experience. We do not have to rely on editorials in newspapers, although it is good to have their opinion. The credit squeeze and the Bank Rate increases of 1957 hit Scotland's economy hardest of all, and the President of the Board of Trade knows it. Because of these measures unemployment in Scotland rose to over 100,000, yet the President of the Board of Trade tried to show us that, far from doing harm to our economy, these measures had helped our industry. What nonsense!

In a leader some time ago—I shall not quote it all—the Scotsman spoke about the blunt instrument of the Bank Rate. Of course it is a blunt instrument, and it hits the economy of Scotland far more than any other part of the United Kingdom. Whenever there is a bursting of the seams in the Midlands, or in the South of England, this is what the Government turn to, knowing full well that areas like Scotland and the North of England are most severely hit by it. Yesterday the Joint Under-Secretary of State spoke about the need to keep our economy on an even keel. Listening to the two Front Bench speakers for the Government yesterday, it seemed to me that both the Joint Under-Secretary of State and the President of the Board of Trade were in a leaky boat—a boat which was being dashed about in a stormy sea. I am not over-worried if both of them perish—politically, I mean. What we on this side of the House are deeply concerned about is that the Scottish people should not perish with them. That has been the whole purpose of our efforts, not only in this debate but for a number of years.

Both Ministers spoke of the improvements in the employment position. Of course, we on this side welcome any improvements in employment, but we also realise that we still have a very long way to go even if we are to get back to the 1957 position. Giving the Minister of Labour's figures, we had, on 17th June, 1957, 32,523 unemployed men in Scotland—2.3 per cent.—and 16,723 unemployed women—2.2 per cent. That was a total of 49,246 or 2.3 per cent. overall unemployment in Scotland compared with 1.2 per cent. for the United Kingdom.

Let us turn to the latest figures. The Government have been taking great credit for a great improvement, but if they push the figures up to over 100,000 and then bring them down a little they can always claim that there has been an improvement. If we turn to the figures for 13th June, 1960, what do we find? The number of men unemployed was 50,276. In those two years there had been an increase from 2.3 per cent. to 3.6 per cent. That is the improvement. The number of women was 19,290, or 2.5 per cent. The overall unemployment figure for Scotland at the moment is 3.2 per cent. against the United Kingdom figure of 1.4 per cent. In other words, with all the boasting yesterday of an improvement in our position, we have today 20,320 more men and women unemployed in Scotland than in June, 1957. In Scotland at present we have 10 per cent. of the population and 22.8 per cent. of the unemployed of the United Kingdom.

But it is even worse than that, because if we are examining the unemployment figures we must also examine the number of jobs available in the employment exchanges. As I have shown, 22.8 per cent. of the unemployed is Scotland's share, but our share of the available jobs is a miserly 4.6 per cent. That limelights the position.

But it is even worse than that. Here I have to go to a previous month, because I could not get the figures for the current unemployed, but on 16th May, 1960, we had 52,214 men unemployed. Those who had been unemployed for more than eight weeks totalled 34,979. In other words, of all our unemployed people a month ago, 67 per cent. had been unemployed for more than eight weeks. In other words, our unemployment is long-term unemployment. The comparative figure for women shows that 64 per cent. of our women who were unemployed in May, 1960, had been unemployed for more than eight weeks.

The only cure which we are offered by hon. Members on the Front and back benches opposite is that we should not talk about it. These are the sort of things which the Government are asking us to keep under our hats or, if we dare to talk about them, to talk about them with bated breath. It seems to me that it does no harm to our prospects in Scotland to let the world know the treatment which Scotland has had from this Government.

I turn to other figures. These are for 1959, because we are dealing with some Papers from 1959. We find in the figures which show migration from one region to another that Scotland had a net loss of 8,000 men last year; 8,000 insured male workers left Scotland and went over the Border. So did 1,000 women. This gives a net loss of 9,000 of our population last year. The tragedy is that by far and away the majority of those people who left Scotland were our skilled workers, making it much more difficult to attract new industry to our country.

Let us look at the figure for London, where the overcrowding is so serious. The figure for London was not a loss of population, but a net gain of 24,000 workers. If we add the loss for Scotland to the loss for the Northern regions, we have a figure not far away from the 24,000 which London gained.

If we look at the Ministry of Labour Gazette figures, we find that the proportion of employees aged less than 20 in Scotland was still the highest, at 10 per cent. compared with 8.5 per cent. for Great Britain. That is understandable, too. It is usually when our people are over 20 years of age that they find that they have to leave our country to get work. We find from the Ministry of Labour Gazette that migration from one region to another from 1951 to 1958—seven years—showed that 54,000 insured workers left Scotland. If we add all these to our figures of unemployed, it gives some realisation of what the unemployment figure would be.

My right hon. Friend yesterday gave figures of the increase of population. I will not trouble the House with that today. I have drawn the general picture of unemployment in our country. But, again, there is a much more serious side to it—the unemployment among youths in Scotland. On 13th June, 1960, there were 2,045 boys unemployed in Scotland, which was 27.5 per cent. of all the boys unemployed in the United Kingdom—a very high proportion indeed. The figure for girls is 817–19 per cent. of the United Kingdom figure.

Just think of it. Two weeks before the school holidays we have in Scotland 2,862 young people unemployed before the labour market becomes flooded again with school leavers. I am wondering what will happen to those in Scotland who leave school at the end of June. The position for the future is even blacker.

The increase in school leavers is something of which we have to take account in this debate. This year, there are 61,000 school leavers in Scotland. In 1961, there will be 75,000 school leavers and in 1962, 82,000—a very considerable jump indeed.

I am glad to see that the Parliamentary Secretary to the Ministry of Labour is here. In a debate on 30th June this year he had this to say about the bulge: The bulge has roused varying reactions…They vary between expressions of very grave apprehension as to what will be the effect of this large number of school leavers on the labour market, and expression of optimism and welcome at the golden opportunity to remedy deficiencies that exist in our manpower."—[OFFICIAL REPORT, 30th June, 1960; Vol. 625, c. 1577.] The latter expression will definitely apply to the Midlands and to the South, and the "grave apprehension" applies to Scotland. Everyone who is interested in the well-being of youth realises that only too well.

Plato said, a very long time ago: He is not only idle who does nothing; he is also idle who could be better employed. How that applies to so many of our young people. In 1955–56 40 per cent. of all school leavers in Scotland entered apprenticeships, but in 1958–59 that figure had dropped to 31 per cent. It is not only that we have far more than our share of unemployed young people in Scotland, but many of our young people of ability and skill are entering jobs that will lead to frustration when they could be tackling something much more difficult than they will ever be tackling in the jobs they are entering.

Again, I turn to the Ministry of Labour Gazette. We find that Scotland is at the top of the league in one instance. Scotland has the highest proportion of boys entering employment at 15 years of age. Last year, 88 per cent. of our boys in Scotland entered employment at 15. In London and the South-Eastern region the figure is just 72 per cent. The figures for girls were 88 per cent. in Scotland and 72 per cent. in England and Wales.

When we turn to the proportion entering employment at 17 years of age, we find that in Scotland 3 per cent. of the boys entered employment for the first time at 17 and in London and the South-Eastern region, 6.3 per cent. The girls were 3.1 per cent. in Scotland and 7 per cent. in London and the South-Eastern region. I think that one of my hon. Friends asked me, "What kind of jobs?" I am coming to that.

In Scotland, we still have a higher proportion than in England and Wales of our people entering universities. The way is cleared for them. Their chances today are still greater than they are in England and Wales. But even if we have a greater proportion of our people going to universities, the provision of technical education for those leaving school at 15, 16 and 17 is most inadequate. That is the first thing that is reflected in these figures—the lack of adequate technical education for our young boys and girls in Scotland.

Again, when we look at the figures for day release we find that they are 22 per cent. for England and Wales and 11 per cent. for Scotland. That reflects a number of things, including the fact that we have not our proportion of apprenticeships in Scotland. It may also reflect something that is not often mentioned, namely, that the facilities for employers who would be willing to give day release are not always there for them. That is another important thing to remember. When we come to the figures of day release in London at 17 years of age we find that not only is that type of education there for them, but the jobs are there when they have taken the education. These are only some of the reasons why we are so seriously perturbed about the position in our country and why we were so desperately disappointed with the speeches made yesterday by the two Ministers.

To turn to one way in which, perhaps, we can help to get rid of some of the unemployment, I touch on house building. House building by public authorities in 1953 was over 36,000 and in 1959, it was 21,466, a shocking decrease of almost 15,000 houses over those years. My hon. Friend the Member for Fife, West (Mr. W. Hamilton) asked the Secretary of State a Question yesterday. It is evident from the reply that certain local authorities are building no houses at all because of the financial burden that is being imposed on them. It is also evident that many other local authorities are building fewer than their needs justly demand for the same reason. On 16th May this year, 10,938 building trade workers were unemployed in Scotland. All that we have about that in the Blue Book is in paragraph 76: …the industry was not fully employed, and the unused capacity, these are men— especially in Glasgow and the west, keep competition keen for new work. When I read that it reminded me of a previous President of the Board of Trade who jumped from education to trade and is now back in education. He said, "Treat 'em rough and keep 'em keen", or words to that effect. [HON. MEMBERS: "Treat 'em mean and keep 'em keen."] This is the same sort of thing—a heartless, callous philosophy.

My right hon. Friend dealt with the position and gave some facts and figures to illustrate the shocking conditions in Scotland. I want to deal with some other figures. I referred to another White Paper and considered some other vital statistics. I found that the deaths among children under one year of age in Scotland numbered 27.7 in every 1,000, while in England and Wales the figure was 22.5. In other words, in 1958—the last year for which figures were available—out of every 1,000 children born in Scotland five more died in their first year than was the case in England and Wales. For still-births the figure was 23 per 1,000 in Scotland and 22 per 1,000 in England and Wales. That means that, taking live births and stillbirths together, in Scotland six more babies out of every 1,000 died than died in England and Wales.

When I saw those figures I tried to discover what factors were peculiar to Scotland which led to that higher death rate among our children. Those factors are bad housing and high unemployment. Housing and unemployment are both worse in Scotland than in the rest of the United Kingdom. It seems shocking that those factors should be reflected in the deaths among children under one year of age. That is also something which the Government should take into account.

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

They should be ashamed of it—never mind taking it into account.

Miss Herbison

A great deal has been claimed for the Local Employment Act, but many of the projects mentioned by the President of the Board of Trade did not result from that Act; they came as a result of the Distribution of Industry Act. Nevertheless, I want to deal with one aspect of the Local Employment Act. The Joint Under-Secretary seemed to think that it was a wonderful thing that applications made to D.A.T.A.C. automatically went to B.O.T.A.C. That was about all that he had to say about the subject. I find that there is no sense of urgency in dealing with applications for assistance.

The Glasgow Herald, now on the Government Front Bench, backs B.O.T.A.C. to the hilt today. Many applications in D.A.T.A.C. have gone into the pipeline of B.O.T.A.C., but large and important projects have to take their place with small projects. It does not matter how large a project is; it has to take its place in the queue. The Government love tidiness. They were always criticising the Labour Government for centralisation. It was an ugly word when we formed a Government. But the work of D.A.T.A.C.—or B.O.T.A.C. as it is now—is a clear example of complete centralisation; the "Whitehall knows best" attitude at its very worst.

The application is made; in due course a technical expert goes to the firm concerned; he gets all the information and reports back; some time later a financial expert goes to the firm, and he also reports back. It may be found necessary for both the technical expert and the financial expert to go back again, and report back yet again. That is the system, no matter how small the sum involved. There is a leisurely and complacent handling of the matter.

But we still have regional offices of the Board of Trade, although some of them have been done away with in Scotland. I was interested to find a Highland Member asking for one to be re-established. We have a regional controller and a regional deputy-controller. Surely the small cases, which involve little money, could be investigated by these officers. They could then report to B.O.T.A.C., which could take the decision. That would lead to much quicker decisions, and it would leave the great technical and financial experts to deal with the big projects.

Hon. Members on this side of the House are just as keen as hon. Members opposite to safeguard public money and see that it is used properly. If what I am suggesting were accepted it might do away with much frustration and annoyance, and some of the pettiness that is found in the present set-up. There is a frustration and annoyance that sould at times lead to "browning-off" a prospective employer of labour.

I now turn to the question of the price of land. The Minister of Housing and Local Government introduced a Bill dealing with town planning, and during the Second Reading debate the Secretary of State said …whatever reasons may be, the private market in land appears to be rather less active north of the Border. In the country districts, where there is, in any case, little demand for land for development, the present price level is not likely to undergo much chnge."—[OFFICIAL REPORT, 13th November, 1958; Vol. 595, c. 631.] I have other information, and I should like to know what the Secretary of State thinks about it. The Scottish position in regard to land was high-lighted when the B.M.C. finally had to pay £500 per acre. I understand that there is another important project that we are hoping to attract to Scotland, which, as far as I know, will be sited on land which has changed hands fairly recently. My opinion is that the speculator concerned wants £1,000 an acre from the prospective tenant. This is free Tory enterprise. This is what they believe in—fortunes for the speculators at the expense of the unemployed. I ask the Secretary of State what he intends to do about this, and whether he can give us a clear answer tonight.

My hon. Friend the Member for Greenock (Dr. Dickson Mabon) raised the question of advance factories. On the eve of the General Election the Government decided to build three. The ones in England and Wales have been let, and my information is that a reliable client wants the one in Scotland. It is clear that the experiment has worked; as we knew it would. The Government said that it was an experiment, and when experiments are successful their results should be used. It is the Government's duty to build advance factories in Scotland, where the need is greatest. I wonder whether the Secretary of State will tell us tonight that the Government have decided to go forward with the building of advance factories.

Yesterday, the President of the Board of Trade spoke of 23,000 jobs being in the pipeline. Some of those jobs will not materialise for many years. He hoped that another 15,000 would be added. When that 15,000 will materialise goodness only knows. We can only go by our experience of promises previously given by the Government. But even if every one of those jobs materialises the Scottish position will still be serious. My hon. Friend the Member for Edinburgh, Leith (Mr. Hoy) yesterday showed clearly our regular need for 12,500 jobs every year, at a minimum.

What about the increased number of school leavers? What is to happen when National Service stops? Will that just add more to the unemployed?

The President of the Board of Trade spoke yesterday about the percentage of Government-built factory space. It is true that it has increased since the election, but then the people of Scotland rejected the Tories at the election. With no uncertain voice they said, "We want a Labour Government". Perhaps it is because of that that we have a slight improvement in this position, but what I should like the Minister of Labour or the Secretary of State for Scotland to tell me is not just the percentage of Government-built factories we are getting, but the percentage of all industrial building which is going on in this country at the present time. Workers in North Lanarkshire, and the workers in the Highlands, in areas represented by hon. Members opposite, do not mind whether they work in factories which are provided by the Government, or whether they work in factories provided by private enterprise.

There are ways of immediately ensuring that our unemployment will go down. First, use the building workers. We are needing more homes, we are needing greater provision for technical education. Let the Secretary of State be bold and say, "I will put these plans much more quickly into action for technical education". Let the Government build advance factories. Overnight every single building trade worker could be employed, and if that were done it would increase employment in a wide variety of industries. I would say that although it has been tightened up there could be more strict use of industrial development certificates.

I would urge the Government to establish publicly-owned enterprises. I just give one example. What a boon it would be in the North of Scotland if they had a paper pulping industry—a great boon. Private enterprise has not done it. Will the Government do it? That would help there. The Government cannot claim that they do not believe in intervention. There was the £75 million for Colvilles, to give one example, but yesterday the Joint Under-Secretary of State said: Do the Opposition really accept that non-competitive State enterprises should be permanently subsidised in competition with other manufacturing industries?".—[OFFICIAL REPORT, 12th July, 1960; Vol. 626, c. 1308.] The Joint Under-Secretary is like so many on his side who have become so indoctrinated by briefs from the Tory Central Office that they believe anything.

What about the steel strip mill? It was not private enterprise which was bursting to provide it for Scotland to lead to further jobs. Oh, no. It was Richard Thomas and Baldwins which was ready to give to Wales the steel strip mill. There is nothing wrong with the profits of Richard Thomas and Baldwins, which is publicly owned.

The other example given by my hon. Friend was S. G. Brown, Ltd., which was doing so well that the Tories had to get their paws on the profits coming from it. What nonsense to suggest that because an industry is publicly owned it will lose money. What about electricity, which is publicly owned and which has been such a boon to the Highland areas of Scotland? And I could mention many more.

We on this side are not doctrinaire at all. We believe that in our economy there is room for both public and private enterprise, and I would say that it is the duty of any responsible Government, faced with the present situation in Scotland, to throw aside their worn-out shibboleths and use public and private enterprise to bring employment and hope to our people.

4.35 p.m.

The Minister of Labour (Mr. Edward Heath)

I have listened with great interest to the speech of the hon. Lady the Member for Lanarkshire, North (Miss Herbison). On this second day of our two-day debate on Scotland she has introduced some new subjects or some new aspects of this very important subject of employment and industry in Scotland, some of which will be dealt with by my right hon. Friend the Secretary of State—[HON. MEMBERS: "Oh."] —but with some of which I should like to deal myself now.

The House knows that the hon. Lady has herself been a teacher, and, therefore, she is naturally particularly interested in the problems of young people and the problems of apprenticeship. I should like to devote part of my speech to those subjects, but I should like just to put this to her, because I want also to say one or two words about the general employment situation.

We on this side of the House have, of course, absolutely no objection to the frank discussion, the open discussion, of these very serious problems and continuing problems in Scotland. But what we do regret is that sometimes they are put in such a form that the perspective is lost. Because of the hon. Lady's anxiety to improve the situation, the general impression which is given sometimes militates against her real purpose. The impression given is that the whole of Scotland is one large mass of unemployment with appalling social conditions throughout the land.

We comment that this is not the complete and true picture; and if we give the hon. Lady credit for her anxiety to improve things which need improving, I hope that she, for her part, will give us at least an admission that no one on this side of the House is callous—which was the word she used—about these very difficult problems. Many Members and many Ministers have devoted a great deal of time and energy to trying to solve the problems that we are discussing in these days.

Let me say a word about the general employment situation. I have some figures which I will put on record to supplement the figures in the White Paper which went only to 1959 or the early months of 1960.

In February, at the peak, there were 100,877 or 4.7 per cent. unemployed. In June, the latest figure, there were 69,543 or 3.2 per cent., a fall of 31,334, and this fall was 9,000 more than the seasonal fall. The increase in employment in Scotland over that period is estimated at well over 30,000—that is, between February and the end of May, because the June figures about employment are not available. That is the immediate situation.

Mr, Douglas Jay (Battersea, North)

Do the latest figures available, compared with those of two years ago, show more or fewer people now employed in Scotland?

Mr. Heath

A little later I want to deal with the long-term problem, and the causes of it, and I will give some additional figures then.

I want to say a word about the reason for these increases between May, 1959, and May, 1960. In the main, they have been in the distributive and service trades, in engineering, and in iron and steel. There have also been increases in employment in iron castings, in chemicals, in clothing, woollen and worsteds and textile finishing, in paper and board, in hosiery and in carpets. A thing which gives us all satisfaction is that there has been with this increase in employment an increase in the number of unfilled vacancies. There has been from June, 1959, when there were 12,912, to June, 1960, when there were 16,888, an increase of approximately 30 per cent.

The point that I should like to make is that the increase in opportunities of employment in Scotland have come to a considerable extent from existing industry. Therefore, when we consider the problem overall we must appreciate that industry in Scotland at the moment has the capacity to provide these jobs and, I believe, existing capacity to provide more jobs. The other point is that the expansion in Scotland—and this was mentioned by one or two hon. Members yesterday—as we see from looking over the phases of the last few years, follows normally a little later than in England and Wales.

This is why I mentioned the fact that the figures for February to June showed a 9,000 greater fall than the seasonal figures, because the fall for the country as a whole was exactly the seasonal fall. This indicates that for Scotland the phase is not yet concluded. The figures, at any rate, are in keeping with our past experience.

Mr. Thomas Fraser (Hamilton)

The right hon. Gentleman has figures which are not available to us on this side of the House and we are grateful to him for trying to give us a complete picture. I find that the numbers in civil employment in June, 1959, were 60,000 fewer than in June, 1957. Now that the right hon. Gentleman has given us an up-to-date figure, can he tell us how it compares with the figure for June, 1957?

Mr. Heath

I have not been quoting the figures of complete civil employment, because there are always difficulties about the distinctions. I was dealing with the figure which the right hon. Gentleman the Leader of the Opposition used in his speech yesterday, because I want to look at the longer-term trends and do something which I feel that the hon. Lady the Member for Lanarkshire, North did not do; that is, to look beneath the surface at the deeper changes which are going on and their causes. It is open to hon. Members to deplore the figures, but we want to do more. We want to look at the underlying movement.

The right hon. Gentleman the Leader of the Opposition said that there had been a decline in civil employment between 1951 and 1959, and I was doubtful whether, if one took the figures up to 1960, that was still the case. The difficulty is that the figures for civil employment, which include the self-employed and, strangely enough, the employer, are not available for 1960. I have been able to compare the figures for the employed which excludes the other two categories. In May, 1951, they were 2,074,000 and in May, 1960, they were 2,101,000, which is our provisional figure and is an increase of 27,000.

Mr. T. Fraser

Will the right hon. Gentleman now tell us what is the increase in the Great Britain figure for persons in employment? I am sure that he will have to give a figure of rather more than 1 million. Will the right hon. Gentleman realise that it is because this is so that we say that Scotland is getting such a raw deal?

Mr. Heath

I will try to obtain the figures and give them, or my right hon. Friend the Secretary of State for Scotland will give them later.

I was trying to deal with the point made from the benches opposite that there had been an absolute decline in Scotland. I say that the figures that I have given show that there has not been an absolute decline. The numbers in employment between 1951 and 1960 have gone up by 27,000.

Mr. Fraser

My right hon. Friend the Leader of the Opposition took his figures from the Minister's own publication. My right hon. Friend said that he was referring specifically to the 1959 figures as produced by the right hon. Gentleman.

Mr. Heath

I do not criticise the giving of the figures, but I say that if one takes them to 1960 the picture is not the same. I acknowledge that the working population of Britain has increased more than has the working population of Scotland, but taking the figures for 1960 there has not been an absolute decline.

Mr. Jay

Can the right hon. Gentleman say whether or not there has been a decline in actual employment between the summer of 1957 and 1960?

Mr. Heath

I will try to get the figures for the right hon. Gentleman.

If one looks at the reason for the decrease of employment in Scotland one finds that in shipbuilding, ship-repairing and marine engineering there has been a decrease of approximately 10,000, and in coalmining there has been a decrease of approximately 12,000, between 1955 and 1960. In other words, in those two great basic industries there has been a decline in employment of 22,000, which is a very serious underlying trend and, I think the hon. Lady the Member for Lanarkshire, North will agree, not one for which any Government can be blamed.

When it comes to increases, one sees that in engineering there has been from 1955 to mid-1959 an increase of between 8,000 and 9,000, in distribution an increase of about 35,000, and in professional services an increase of 30,000. This is the employment figure and it is important to recognise the problem that we have as a result of the serious decline in employment in two great industries.

Mr. James McInnes (Glasgow, Central)

It has been going on for years.

Mr. Heath

Yes, but it helps to put in perspective the amount of new employment which has to be created in some way or another to cope with it. The unemployment figure, which is 69,000 and is going down, shows that there has been a considerable amount of coping with it.

The problem when we are making comparisons between Great Britain and Scotland arises from the fact that Scotland has a greater proportion of extractive industry—9.6 per cent., against a total for Great Britain of 6.8 per cent.—and it is in the extractive industries that employment is decreasing, particularly in coal but also in farming where there is mechanisation.

Miss Herbison

The right hon. Gentleman has pointed out in various ways that we have had a decrease in employment in the extractive industries. The decrease in mining, the industry that I know best, has been going on for many years. Year after year from this side of the House we have been telling the Government what has been happening in the mining industry and urging them to bring other industry into our country.

Mr. Heath

The decrease in employment in mining has moved very rapidly in the last two or three years. I am stating these as facts for the hon. Lady, to get the picture into perspective and so appreciate the things with which we have to cope.

Another point is that the proportion of manufacturing industry in Scotland, historically, is considerably smaller than in Great Britain—34.6 per cent. against 38.6 per cent.—and in manufacturing industry there has been a lack so far of the industries which grow rapidly, the consumer-durables industries and the motor car industries which in Great Britain as a whole have led to a very rapid increase in employment. When one makes a comparison between Scotland and the country generally this is a fundamental reason Why the increase in employment in Great Britain has been so much greater than in Scotland. This is the historic background.

Mr. William Ross (Kilmarnock)

We had this question before us yesterday and the right hon. Gentleman the President of the Board of Trade said that the consequence of the increased Bank Rate would be to cut down expansion in these very industries. Now, the right hon. Gentleman tells us that these are the very industries that we need in Scotland.

Mr. Heath

My right hon. Friend the President of the Board of Trade was quite clear. He said, both in his speech and in reply to an interruption, that the object of the Chancellor's measures was to restrain the rate of expansion and not to cut back the absolute amount. That is true. The economy is still expanding, and we believe that it will continue to expand.

My right hon. Friend gave details of the prospects yesterday and I do not propose to go over them again, except to say that we see the difficulties of the shipbuilding and ship-repairing industry as likely to continue. As for coal, the problem now is more one of redeployment than of actually cutting down.

From my experience at the Ministry of Labour, I think that the National Coal Board has gone to very great lengths to make that changeover and adjustment as smooth as possible, and I believe it has had great success in that. We have to acknowledge that the industry will be operating at a lower level, but that the amount of redundancy we have had has now been taken up and is not a recurring figure for the future. It has been taken up in the statistics up to date. In engineering and distributive industries, it would appear that the prospects are reasonably good.

I turn from that general picture to a point which is sometimes raised in public; what is done to help those who are unemployed? The hon. Lady mentioned the long-term aspect of this. What is done to help them to equip themselves for employment again? Although it has been said before, I want to say this again because I do not think that it is always sufficiently realised and because it is in large part a responsibility of my Department. At Hillington, Glasgow, we have the Government training centre where we can train and retrain. It is mainly for engineering and engineering draughtsmanship, and there are miscellaneous courses in motor repairing, radio and TV servicing, watch and clock repairing, men's hairdressing, and in the repair and fitting of agricultural machinery.

The capacity is 127 approved training places and the average use at the moment is 88 to 89 a year. We have nearly 40 spare places in that Government training centre which may be used for training and retraining. In engineering, training is limited to disabled men living in Glasgow and the West of Scotland. Otherwise men can be trained or retrained at the centre, but it is not possible to arrange a wider spread for the engineering courses. I hope that now that the motor industry is moving into Scotland those concerned will feel able to let the training range a little more widely, knowing that skilled engineers will be required for that industry.

In addition, we have the industrial rehabilitation units which look after those who have had illness or have been away from their trade for some time. We have two, one in Glasgow and one in Edinburgh, each with one hundred places. We have a large number of people queuing to go into the I.R.U. in Glasgow and the capacity is to be doubled. The expansion will begin on 8th August. Also in Glasgow we are to carry out an experiment with a joint medical centre and an industrial rehabilitation centre. This is the first we have experimented with in the country and it will be run by my Department and the regional hospital board together. This is being planned and will be completed and opened in 1963. The buildings have to be completed, equipment provided and so on.

There are also arrangements for disabled and ex-Regulars to be trained at technical and commercial colleges and in June, 1960, 82 trained and 84 trainees had been placed in employment. I wish to leave the subject of adult training and turn in more detail to youth employment.

Dr. J. Dickson Mabon (Greenock)

No doubt all these preparations for disabled persons are very good. Nevertheless, would the Minister say something about the retraining of skilled personnel? There are many industrial and trade union difficulties which have to be resolved. On a recent spot check, almost one-third of the workers unemployed in Greenock were skilled. I should like to know what public relations efforts are carried out by the Ministry to make known to these men how new skills can be acquired, particularly with the new motor industries which we hope are coming to Renfrew-shire and other parts of Scotland. I should like to know what the Depart ment is doing to make that more widely known.

Mr. Heath

The problem has been stated by the hon. Member very clearly and I have touched on it, but I do not want to go into detail. I wanted to refer to the changed situation at Bathgate.

There has been an improvement in youth employment and prospects over the last year and in June, for the first time, the vacancies for boys exceeded the number of unemployed boys. That, I think, is very important. In June, 1959, the number of boys unemployed was 2,981 and there were 1,254 vacancies. in June this year the number of unemployment was 2,045 and the number of vacancies was 2,268. That in itself is encouraging. If one looks at the figures for young people as a whole, one finds that in 1959 there were 3,991 unemployed and 4,667 vacancies. In June, 1960, there were 2,862 unemployed and 7,232 vacancies. So in 1960 for every 100 unemployed boys there were 111 vacancies and for every 100 unemployed young persons there were 253 vacancies.

We often hear comparisons made between towns in Scotland and towns in the South, in which the figures are much larger. As Minister of Labour, I am happy if we can have a sufficient number of vacancies into which to fit young people. All the figures show that there is demand in the South and that industry should expand somewhere else. The most difficult areas are those where unemployment problems are most difficult, but the placing of school leavers is satisfactory. Figures for the Easter school leavers—there are not more recent figures—show that one month after Easter, on 16th May, all except 3 per cent. had been placed, and two months after, on 13th June, all but 1.4 per cent. had been placed. That, I should have thought, was very satisfactory. The figure is much lower than the general unemployment figure.

Mr. John Rankin (Glasgow, Govan)

Is Easter a leaving date in Scotland?

Mr. Ross

There is no such thing as an Easter leaving date.

Mr. Heath

Those are the figures I have for Scotland, but I shall certainly look into that point.

The hon. Lady made comparison with the South, but these figures are considerably better than those for either Wales or the Northern region of England. That is no consolation to a Minister of Labour, because he wants workers to be placed in whatever area they are, but as the hon. Lady placed so much emphasis on the comparison with the rest of the United Kingdom I think I should point out that the position over school leavers is better in Scotland than in Wales and the Northern region.

The real problem is that of the older youths. There has been an improvement here. The improvement from 1959 to 1960 was a fall of 1,020, which represented a greater improvement among youths than among the rest of the unemployed. The problem of the school leavers is the smallest problem. That of the youths is the next, and the problem of the adult unemployed is the greatest. Among the youths, both those in Scotland and in the rest of Great Britain, particular difficulties pertain to those who in the first two or three years change their jobs frequently. I sometimes wonder whether those who do so realise the difficulties they are creating for themselves later on when employers will see from their record cards that they have changed their jobs so frequently.

Mr. James H. Hoy (Edinburgh, Leith)

It is not a question of their changing their jobs because they want to do so. The whole of our complaint is that far too great a proportion of them are placed in dead-end jobs, and this will be reflected in the unemployment of youths in the under-twenty group later.

Mr. Heath

I am afraid that is not entirely true for, if one looks at the cases in detail, one finds that a number of young people deliberately decide that they would rather do something else and are not in dead-end jobs. In fact, I have come across a number of cases in which they have left a job to go on a course because they think they can get something better, and then they decide that they do not like it after all. I am making a general comment. It makes the situation more difficult.

I turn now to the increase in the number of young people to which the young lady—[Laughter]—to which the hon. Lady the Member for Lanarkshire, North referred. I hope that the hon. Lady will accept that as a compliment. Again, there is the difference between Great Britain and Scotland. For 1956 to 1962, in Great Britain the increased number, reaching 15 years of age one year over another, is 52 per cent. In Scotland the figure is 31 per cent.—a much smaller problem. It may be that in 1961 and 1962 the picture will be reversed. In Great Britain in 1962 there will be an increase of 20 per cent. compared with 1959, and in Scotland 23 per cent. The figures we have to deal with are, for 1962, an increase of 19,000 over 1959. The hon. Member for Coatbridge and Airdrie (Mr. Dempsey) said yesterday that we did not realise that we had to place 81,000 young people leaving school in employment in 1962. That figure is correct, but the emphasis is on the difference between the normal number and the number due to the increase in the bulge, which, in this case, is 19,000.

We understand that the National Coal Board expects to take on 2,000 boys this year and 2,500 next year, in comparison with 1,000 last year. That is an encouraging pointer.

Mr. Bruce Millan (Glasgow, Craigton)

Is that all that the right hon. Gentleman intends to say about the problem of the bulge?

Mr. Heath

I shall come back to it later on, because the problem of the bulge is part of the overall employment problem in Scotland. It is not separate, and we have to deal with that in the same way. I want now to deal with the problem of training.

In Great Britain last year we had a substantial increase of 5,500 apprentices in addition to the 93,200 in the year before—a percentage drop, however, which was a decline continued from 1956. In Scotland there was a slight decrease in the number of boys taken in apprenticeships, from 10.956 to 10,152. This reflected the contraction in shipbuilding and ship-repairing, which have been the main sources of apprenticeships in the past.

The problem is this. We have heard a great deal in this debate about diversification of industry. The right hon. Gentleman the Leader of the Opposition supported it strongly yesterday and the hon. Lady referred to it today. We agree upon that, but the problem in that is that these light industries do not produce at any time, in any place, the comparable number of apprenticeships provided by the older, basic industries which they are replacing. That is the sad fact we have to face in the apprenticeship position. I have looked into this to examine the comparisons. In Scotland 60 per cent. of boys under 18 are in five main industrial groups—agriculture, forestry and fishing; mining and quarrying: engineering and shipbuilding: building and civil engineering; and the distributive trades.

Between 1956 and 1959—the three years of the bulge which we have had so far—the proportion of apprenticeships in engineering and shipbuilding fell from 25.7 per cent. to 19.5 per cent. a considerable fall. The percentage of new entrants into engineering and shipbuilding getting apprenticeships fell from 62.2 per cent. to 58.6 per cent., a slight fall. The number of boys going into distribution rose from 6,810 to 8,590, but the proportion of apprenticeships in distribution was 14 per cent. in 1956 and 15.7 per cent. in 1959. That illustrates vividly the difference in the contribution towards apprenticeships of the newer developments compared with the older ones.

What are the Government doing to help? We have had many discussions in the House about this. One was as recent as 30th June and I do not want to go over the whole ground again or to have a general debate about apprenticeship policy. As the hon. Lady knows, the Industrial Training Council is a joint operation of industry set up by the employers and the trade unions. We are pursuing the question raised with me by a deputation from Glasgow, suggesting local organisations of the I.T.C. in order to encourage employers and trade unionists to arrange more apprenticeships.

We also have the G.T.C. course in first year apprenticeships at Hillington. We hope to start it in August. The pattern is to encourage small firms to participate in this, and interest is being shown by employers in Glasgow, Paisley and Renfrew. We are giving this the utmost publicity through all the means over which we have control in order to persuade more employers to produce suitable candidates for this course.

I should also mention the training allowance scheme, which I want to be as widely known as possible. This is intended to help those in areas which are without training opportunities to train away from home. There are more of these areas in Scotland than in the rest of the country. It is used, of course, within Scotland, and very few use grants to cross the border. The figures show that in January, 1960, 262 of these grants, or 29 per cent. were made in Scotland.

I turn now to long-term problems of apprenticeship. We are confronted with this switch from basic industries, taking large numbers of apprentices, to light industries taking fewer. This means a fresh pattern of training over the next few years and fresh skills being obtained. It may mean an increased need for technicians and technologists. I am sure that the Scottish educational system will adapt itself to this changing pattern and to the needs of skills of this kind. I agree with what the hon. Lady said about the need for day release. We will do everything possible to encourage more day release For these training purposes.

I will now sum up how this situation appears to me. In Scotland we have an increasing population and, especially, an increase in the number of school leavers. That is our first problem. We have declining employment in some basic industries, and the need to increase training. I believe that these problems can be dealt with only by taking more industries to Scotland and by expanding industry already there. My right hon. Friend the President of the Board of Trade gave his picture of the situation yesterday. There has been some criticism by hon. Members opposite about the figures which are produced and which I have sometimes given in reply to supplementary questions in the House.

Mr. Ross

Especially wrong ones.

Mr. Heath

When the hon. Member has been misled with a figure he has been told the correct one within ten minutes or so. My right hon. Friend the President of the Board of Trade and I and other Departments have to rely for these figures on the firms concerned. They are given to us to the best of their knowledge and in good faith. Sometimes their plans change and situations develop. Broadly, the figures we give are those available at the moment.

Dr. Mabon

Is it not obvious that if the Government are to rely on economic intelligence of this kind, they should not merely rely on what is intended to be done? Should they not also rely on what actually happens by having a check on industrial development certificates? If a firm says to the right hon. Gentleman or to the President of the Board of Trade that if it gets a certain extension it will be able to provide 100 jobs, he or his right hon. Friend should have a double check afterwards—not necessarily in reproach to the firm—but simply to see what has actually happened. This is not being done now. Right hon. Gentlemen are trying to claim credit for figures which are speculative and never borne out.

Mr. Heath

There is a great deal to be said for that. There is considerable difficulty in getting statistics of this kind. We quite accept that point.

The industry to be brought in must be viable and not something which will close down on the merest breath of local difficulties or of world trade difficulties. I believe that Her Majesty's Government are right to concentrate on this policy, as we are doing, to deal with these underlying difficulties which I have described.

In a rather striking phrase the right hon. Gentleman the Leader of the Opposition said yesterday that what Scotland needed was for the whole economy to be jerked up to a higher level. It is probably not a phrase he would have used as a professional economist, but it was a vivid phrase to describe the treatment which the economy needs. He did not go on, as the leader in the Scotsman pointed out today, after giving an analysis, to put forward new or concrete suggestions of how to achieve this.

The right hon. Gentleman made a suggestion, repeated today by the hon. Lady the Member for Lanarkshire, North, that State firms should be set up, without apparently saying whether they were needed and whether there was a requirement for a paper mill there, and so on.

Mr. Cyril Bence (Dunbartonshire, East)

The right hon. Gentleman is beginning to slip.

Mr. Heath

Not at all. The fundamental question is, can any of these things be viable and justified on their own? The attitude of hon. Members on this side of the House is that State management of individual productive firms of this kind is not, in the long run, likely to be a satisfactory development.

The right hon. Gentleman went on to say that the Government had not done sufficient to push industry into Scotland, but immediately added that we should not take that to mean that industry should be directed anywhere. It would be interesting to know how one can push industry somewhere without directing it. We are trying to influence and induce industry to go to Scotland. As Minister of Labour with a responsibility to other parts of the country, I must add that there are other areas which have difficulties.

Until recently South Wales and Merseyside have had considerable difficulties, and the North-East Coast of England still has difficulties. Firms which propose to expand have a choice of where to go in the areas in the development districts to which the inducements apply. However ardently hon. Members from Scotland advocate the case for providing employment in Scotland, I am sure that they will recognise that there are other areas competing for the expanding industries of this country, and it is perhaps natural that employers sometimes go to those places which are closer.

The real question is whether the developments which are taking place are of a type and on a scale likely to help to jerk the economy, I believe that we are moving into a period when it is possible that that will happen. With the development of the steel industry in Scotland, the developments at Ravenscraig, and with the developments taking place in the motor industry, the inducements for component manufacturers to follow them—as they are beginning to do in the North-West and adjacent to Merseyside—and with the kind of industries which the President of the Board of Trade described in his speech yesterday, the position is arriving when we may be able to move away from the difficulty of Scotland having twice the number of unemployed to be found in England.

There are other factors. Industrialists must be realising that the labour position in the Midlands conurbation, in London and the South-East, is such that there is no hope of expanding in those areas, because of the acute labour shortage. Industrialists must realise that and look elsewhere.

If one looks at the position the other way, industrialists must realise that in Scotland there is an excellent labour supply of high quality, some of it very skilled. I am glad to say that the trade unions have been able to make satisfactory arrangements about working conditions with the firms which have gone to Scotland. That is very satisfactory, and I hope that employers in the South will recognise that. I am certain that the extent to which employers and trade unions improve industrial relations in Scotland will help to attract industrialists to that area.

Mr. Jay

Does the Minister realise that many of us who represent London constituencies would like to see the Government being much tougher in refusing industrial development certificates in London?

Mr. Heath

The operation of industrial development certificates is not my responsibility, but I think that my colleague the President of the Board of Trade has operated this system with considerable toughness. Also, as the right hon. Gentleman knows, it is not very pleasant for a Department which deals with a large section of industry always to be telling industry that it cannot expand in certain areas but must go elsewhere.

Mr. Jay


Mr. Heath

Because, as the right hon. Gentleman knows, it makes relations extremely difficult. But that is not the point. The President of the Board of Trade has been quite regardless of this, and has operated the policy with great fairness.

Amenities available in an area play a great part in the movement of industry, and there is evidence of the satisfaction felt by firms which have already gone there. Distance presents a problem, but I do not believe that distance matters very much compared with these other things. The more industry recognises the value of these the more willing it will be to overcome distances.

I believe that this could be the turning point. From my talks in Scotland, and from talks with members of my Department, I believe that there is a buoyancy amongst the people because of the developments in the steel and motor industries, and because of other industrial moves to the industrial areas and the development districts. There is that buoyancy, and I believe that we must do everything we can to keep up the pressure and ensure that we bring about a permanent change in the industrial situation in Scotland.

5.16 p.m.

Mr. John Rankin (Glasgow, Govan)

We have listened with interest to the Minister of Labour. He accused us of creating a wrong impression. I think that he did so because he was comparing the passive attitude adopted by hon. by hon. Gentlemen behind him with the vigour of expression which comes from this side of the House when we are dealing with the problems of Scotland. Without giving a wrong impression to the other side of the House, I, too, would like to consider the long-term problem and refer to some of the things said by the right hon. Gentleman.

There is a good deal of anxiety about what might be the exact interpretaton to be placed on the Chancellor's announcement about the restrictions in credit facilities. As has been said already, today's Glasgow Herald, a Tory paper of repute, points out that this will have a serious retarding effect on expansion in Scotland. I have the article but I do not propose to quote it as it has already been used.

The right hon. Gentleman tells us that the total amount of expansion is to be cut back, but not the rate of expansion. I hope that I followed him correctly.

Mr. A. C. Manuel (Central Ayrshire)

It is very difficult to know what the right hon. Gentleman means.

Mr. Rankin

If we have to cut back the total amount of expansion, but not the rate of expansion, it seems that the right hon. Gentleman is telling us that the total amount of expansion in the areas of Scotland about which we are concerned will not be cut back. If we are to cut back the rate of expansion without affecting Scotland, as I understand it, it means that while the total amount of expansion for the country is to be cut back the total amount of expansion in Scotland will not be affected. I hope that before we conclude this debate, if the right hon. Gentleman does not propose to make that point explicity clear, the Secretary of State will do so.

The right hon. Gentleman said that vacancies for school leavers now exceeded the numbers which could be employed. He used a leaving term which is not known in Scotland. The leaving periods in Scotland are January and July and perhaps the right hon. Gentleman meant January. The important point is that the greater number of boys and girls leave Scottish schools at the end of June. One wishes to be sure that at that period the situation will still be as it was described by the Minister when he said that the vacancies exceeded the numbers employed. All the statistics we have deny that statement.

The right hon. Gentleman further asserted that many of those boys and girls changed their jobs frequently and and I think he indicated that they changed them too frequently. I have not the figures available now but when we were dealing with education on the Floor of this House, I think it was two years ago, I went into the problem more completely. On 23rd May in an article in The Scotsman I developed it and showed from all the figures available that the number of boys and girls who change their jobs is not something that we can criticise. The number of young people who leave school and then remain in their jobs, who enter on apprenticeships and serve them for the whole period, is remarkably large. That is something for which we should applaud these young folk because they are doing it in a world that changes rapidly and which has so many disturbing effects on youth.

Mr. Heath

I agree with the hon. Gentleman. In dealing with youths who have not worked we are in any case dealing with a small proportion. The figure is only 2 per cent. or 3 per cent., but of these the most difficult are always those who, as I said, have made frequent changes.

Mr. Rankin

I accept the right hon. Gentleman's explanation. He went on to say that a particular industry to which I shall refer was not producing the same number of apprenticeships as formerly. That is true because of the changing nature of industry. The right hon. Gentleman might have said that while we may not be producing the same number of apprentices in industry today we require far more trained technicians and technologists than ever before. Last Thursday morning, during the debate on education in the Scottish Grand Committee, I said that in 1900 for every thousand persons in industry in Great Britain there was one skilled engineer or scientist. Today in the aircraft industry, for example, the figure is one skilled person for every thirty people in the industry. In the chemical industry it is one for every forty, and that is the measure of the change which is now taking place. There is a greater demand than ever for trained personnel from our schools and that emphasises the importance of educating these boys and girls for the increasing number of jobs that we are all sure—at least we should be sure—will await them in the new world growing up before our eyes.

After saying all these things and listening to the hopes of the Minister of Labour which we trust will materialise in the future, although it may be a rather far distant future, we are brought back to the fact that at the moment there are 70,000 persons in Scotland who want jobs. In addition, to meet the needs of Scotland we have to find 12,000 new jobs every year. We welcome the contributions from what I might call the visiting Ministers, and we hope to see them back, but we must still face the fact that, with that number of jobs to fill, so far we have heard of only 39,000. Some are undoubtedly visionary, many are apocryphal, but we hope that at least the others will materialise in the near future.

When talking about these figures we must remember that they represent human beings and that we are not just dealing with figures in a Government Report. They represent men and women and boys and girls. One group has grown to maturity and thousands in that group have met little but "the slings and arrows of outrageous fortune." The other group looks forward to entering on life and experiencing what should be its wonders, yet despite what the Minister has said they face the dreadful fact that they may start with no job to do.

We waste our breath in lamenting delinquency when our form of society breeds the very thing that we condemn. If people are not working the cause must lie somewhere, either in private industry, in lack of investment or in Government policy. All these things have been mentioned and criticised and I wish to examine them. If the industrialist is to blame, why leave him to do a job which we say he cannot adequately perform? Surely the answer is obvious. The Government ought to be taking it over. That is not a new idea.

The Government have taken over industries. If we look at the industrial pattern in Britain today we see that it consists largely of nationalised concerns, partly nationalised concerns, concerns operating on Government benevolence and concerns hoping for Government benevolence. Of course, this is not new even to the Tories. If the Minister of Labour does not know how to push industry without directing it, then he should go to his right hon. Friend the Minister of Aviation and ask him how he did it.

In the aircraft industry there was a mass of people competing for limited orders and limited business. The Minister of Aviation recognised, as did the Government, that the word "competition" was greatly abused. He did not say to the firms in the industry, "Go here or go there"; he got them together and said to them, "There are too many of you". I was present when the right hon. Gentleman first dropped the hint to the 450 individuals representing the competing firms in aviation, all looking to the Government, and like ducks in Hyde Park seeking the crumbs which came from the Government's hand. The right hon. Gentleman said to them, "There are too many of you. Get together. Reduce your numbers. Get away from this idea of competing and competition." Almost within a month they did so. We now have one helicopter unit, two units dealing with the engine side and two groups dealing with air frames.

Having said that, the right hon. Gentleman did not tell them to get into the world outside and look for work. He said that he would give them the work to do—the work that can be done. He did not argue about competition. Those firms are now in these great units.

If it is said that there is insufficient investment from private sources, again the Government have the answer. The remedy is in the hands of the Minister and his hon. Friends. The Chancellor of the Exchequer can budget for whatever surplus he deems necessary in the interest of the country, and he can fix the tax that is necessary to produce that surplus so that the burden will fall on the shoulders of those most fitted to carry it.

If we say that high taxation of our financial manipulators will drive capital from the country, then again the Government have the answer. Exchange control will help to temper that sort of movement. If a Government determined to solve the problem of unemployment adopts the methods I have indicated, which are the real solvents for this long-term problem of unemployment in Scotland, then the moans and groans will come from the Government benches and not from this side of the House.

My third suggestion is that Government policy, despite all that we have heard, has something to do with unemployment in Scotland. In face of that policy one must recognise the difficulties that confront many business men in Scotland today, due to the Tory policy which most of them support. At this very moment twelve Scottish industrialists are in Russia seeking trade agreements that will benefit our country and which, we hope, will provide more jobs in Scotland.

Will the Secretary of State for Scotland—I hope this question will be conveyed to him—or the President of the Board of Trade if he is coming back into the Chamber, guarantee these gentlemen that they will have the full support of the Government in their mission and that their efforts will not be retarded? Can we be given that promise tonight? If it is given, I am sure it will be conveyed to these gentlemen immediately.

I ask that question because ten days ago a delegation from the Institute of Directors was in the very city in which these Scottish business men are today. The Russians agreed with the delegation that trade with Britain could be doubled and jobs in Scotland thereby increased. They suggested that to give security to the arrangement there should be a ten-year plan. But the Government killed it. They would not allow that trade delegation a free hand to deal in all types of commodities. I was talking this forenoon to a member of that delegation and he told me that it was because of the limitations imposed upon their activities in an attempt to reach an agreement on the type of commodities to be exchanged that the mission more or less failed.

We are imposing restrictions on trade with China. If the President of the Board of Trade were present he would recall that I have raised this matter time and time again in the House. The trade treaty with Japan is being held up because we cannot for some reason or other decide between our relations with China and our relations with Japan—how free should trade be with one country, how unfree with another.

Restrictions on trade with China hit importers in this country. Now they are hitting exporters, people who send goods from this country, because the Chinese are now saying that if we limit what we buy from them they will limit what they buy from us. Tory business men who are Members of this House and who are at present carrying on important trade with China are just as annoyed about that sort of thing as we are on this side of the House. I am certain that they are protesting to their Government.

The by-product of all these activities in the world market is unemployment in Scotland. The Government are half-hearted about the whole business. They are half-hearted because they, unlike some of their supporters, do not like the politics of many of these countries. It may be unfair to the Government to say that they do not like the politics of those countries, but the Government are responding to American pressure and in America the politics of those countries are not popular. The result is being felt in Scotland at the present moment.

I will give one example—scientific instruments. Those who come from Glasgow and the west of Scotland know that that is a fairly important industry there. Britain exports £20–£30 million worth of these products all over the world every year. But there is an embargo upon their export to China and other places in the Far East. Yet in the College of Iron and Steel in Peking I saw some of these embargoed goods exported from Western Germany which signed the same agreement as we did in Paris promising not to export them. On one occasion I rode in an American car in Peking. How did it get there? It got there because trade knows no barriers. If we refuse to trade directly, in the end the goods go indirectly. And unemployment is the product of that stupidity. For this the Secretary of State for Scotland must bear his share of the responsibility. When he replies, it will be no use his moaning and groaning about his difficulties. He is helping to create them.

I wish to look at this position as it affects my constituency. In Govan there are between 10,000 and 11,000 people who earn their living in shipbuilding, ship repairing and associated industries such as ships' chandlers. Consequently, their interest in a debate of this nature is intense. I want to look at the indicators which point to the future. In 1956 1,426,000 tons of shipping were completed in Scotland, and of this 809,000 tons were sent to overseas owners. Judging by the Government digest of statistics for 1960, if the trend which has been operating since the beginning of this year continues we shall complete 516,000 tons of merchant shipbuilding and send to overseas owners 108,000 tons. I will not elaborate on those figures, because the Digest does that. I shall quote from it later.

If we refer to shipbuilding orders coming in to replace the completed ships, we see that in 1955 orders for 800,000 tons of shipping reached the producers. By 1959 the figure had fallen to 114,000 tons. In respect of overseas owners the 1955 figure was 188,000 tons, and by 1959 the figure had diminished to 58,000 tons. As a result, the number employed in the industry fell from 73,000 in 1958 to 68,000 in 1959.

The Report, using very mild language indeed, says that 1959 was a discouraging year for the shipbuilding industry in Scotland"— owing, we are told, to the world situation. The Report says that the world situation resulted in a sharp drop in new orders in the past two years. It also says that those obtained by Scottish yards in 1959 were fewer than those in 1958, which were less than a quarter of the average for the preceding three years. The hon. Gentleman will find all these references in paragraphs 165–169 of the Report. Total orders in hand at the end of last year consequently represented just over two years' work at the 1959 rate of completions as compared with nearly four years at the end of 1957.

Yesterday I interrupted the President of the Board of Trade on this subject. He said it was due to the world situation. I suggested that that was not the complete explanation. In a way it is, but, in fact, it is not. What do we mean by "the world situation"? We are told "increased competition". Of course, but what does that mean? It means that more and more countries are building their own ships. It means that Liberia, which in 1950 had one ship of 1,000 tons, in 1960 has 11 million tons of shipping and is now the second largest ship owning nation in the world. We know that this is a facade for tax-dodging. We know that Liberia is in that position because of flags of convenience and because of the tricks employed by American shipowners.

We know that much of the competition which we face is due not just to the world situation but to the fact that the American Government lay down regulations about the carriage of American cargoes. There is no free competition in the world at all. In addition, the American Government aid their shipbuilders in many other ways. We in Scotland are feeling the effect of this. It is all covered over by the phrase, "We are suffering from the world situation." We also suffer from the attentions of our friends. The end product lessens the demand of the shipowner in this country on the shipbuilder, and this results in the figures which I have given and to which the Report refers.

One would expect that the Government would have some solution to this problem, but all they have to say is contained in paragraph 170 of this Report. We are told that a subcommittee of the Shipbuilding Advisory Committee has had the matter in hand for some time and in due course will make a report, so the policy may then be decided. When will that report be ready? Will it be issued before the House rises for the Summer Recess? That is not adequate treatment for a problem so serious as this, a problem which has given rise to the statements which the Secretary of State makes about it.

While the sub-committee is considering the matter, Scotland waits, and wonders whether it is to repeat some of the miseries of years gone by, miseries which still burn in the hearts of men and women in my constituency and which occasionally help to produce the difficulties connected with modernisation and so easily and lightly condemned by hon. Members opposite.

The second solution is in the second sentence of the paragraph: A committee under the chairmanship of Lord Chandos submitted their Report to the Government at the end of May on replacing the liner Queen Mary. Does that latter statement about the Chandos Committee mean that the Government are contemplating introducing a policy of "scrap and build"? If they propose ultimately to scrap one great liner and build a new one in her place, then that news will be welcomed everywhere in Great Britain. But more so if it were a pointer to a policy in shipbuilding which has been urged upon the Government frequently from this side of the House.

In many ways, ships are our greatest exports. £50 million worth were exported last year. Not only are They exports in themselves, but they carry exports. Every ship built in Great Britain and sailing the seas of the world is also a floating exhibition for British products, British skill and British workmanship. That is why, apart from my particular interest. I think that this is one of the things about which we need an answer more definite than that given in the Report.

I should have liked to have spoken on aviation, but I shall keep that for another time. There is one fact which I wish to emphasise before I conclude. We are talking about jobs and the lack of balance in the Scottish economy as compared with the English economy. We have also to look at the lack of balance within the Scottish economy itself.

Scotland's population is largely confined to a central belt, and all our talk about new jobs, particularly in industry, makes us think too frequently of Glasgow and the surrounding area. When we talk of new towns, we have the habit of thinking about them being put too near to Glasgow. We must think of dispersing the population and sending people to other parts of Scotland.

I have spoken about this solution before. We deplore the depopulation of the Highlands. We deplore the fact that while the total population of Scotland has been increasing, that of the Highlands has been decreasing and will continue to decrease. If we are to fix the population in the Highlands and even get it to grow, then the fourth new town for Scotland should be near Inverness, or Inverness should be used as the area from which it would develop.

We have been talking about a fifth university. The Report of the Committee on Scientific Manpower shows the need for a new university. We are lagging seriously behind other countries not only in our present but in our prospective output of scientists and engineers for 1962, when there will be a deficiency of 5,600 such men who are absolutely essential to us if we are to keep our place in the new world.

If we are to have a fifth university, the university and the new town should be combined in a great university town in the North of Scotland to provide the engineers, the scientists and the lawyers whom we need and who will help—

Mr. Bence

Who wants lawyers?

Mr. Rankin

—to fix the population—

Mr. Ross

The lawyers will.

Mr. Rankin

For that project we must have the industries necessary to its development. That can be done only by the Government. It has already been done in different parts of the world.

In Turkey a new capital was created and the Turks broke with their old capital whose history goes back into the centuries, and created the capital of Ankara in the middle of Turkey, de veloping it from a very small town. The same sort of thing has recently happened in Brazil. It can be done in Scotland, too, and it will help in that dispersal of the population which is essential.

If Scotland's population is to be spread, it is vital to Scotland's development that we take the steps which I have indicated. It may be that Scotland will lose people to other parts of the world. We want to see Scotsmen still carrying the torch all over the world, but we do not want that to result in a shrinking population in Scotland. We want a country to which men and women will come, and the creation of a new university town is one of the ways in which we will lay the foundations of that new Scotland.

6.0 p.m.

Sir Fitzroy Maclean (Bute and North Ayrshire)

The hon. Member for Glasgow, Govan (Mr. Rankin) covered a very wide range, from Turkey to Japan, and he certainly will not expect me to agree with a great deal of what he said. I am, however, grateful to him, as I think we all should be, for reminding us that what we are dealing with today is a human problem, and that we should think in terms of human beings and not of statistics.

I listened with interest to the speech yesterday of the hon. Member for Central Ayrshire (Mr. Manuel). I am always glad to hear my constituent speak, and, also, I am always glad when I find a measure of agreement between us. I hope that one day, perhaps, he will vote for me, though I do not think that that is very likely. The hon. Member made an eloquent appeal to industrialists to co-operate, and I agree with him very much. I would join him in that appeal, because I think industrialists have a very important part indeed to play in our efforts to solve this problem. I think that we should also remember, as the hon. Member for Govan said, that industrialists are also human beings. This is one of our great problems—that we are dealing with human nature, which is never easy to deal with at any time.

Some of us went not so long ago to Glasgow to a conference which was summoned on the initiative of the Scottish T.U.C. I think that it would have been very useful if it had been attended by industrialists, as well as Members of Parliament from both sides of the House and representatives of Scottish organised labour. It was a pity that there were no industrialists to take part in those deliberations, to which they could have made a very valuable contribution.

Surely, what is necessary, and what we are trying to do, is to attract industry to Scotland, and for that purpose we need the co-operation of everybody concerned, organised labour, industrialists, the Government and the local authorities. What is also needed, and I thought that this was brought out very well by my noble Friend the Member for Edinburgh, North (Earl of Dalkeith), in an excellent maiden speech yesterday, is a certain amount of salesmanship. This is something which we are definitely lacking. This is a question of putting ourselves across as a country, of making ourselves a magnet for industry.

The hon. Member for Central Ayrshire mentioned Ardrossan, in my constituency, and I should like to mention the industrial estate at Kilwinning, in his constituency. It is just over the border, and our two problems are very closely linked. This is an excellent site. I recently had a look at the only factory there—for there is only one factory on that industrial estate, although there is room for dozens—and I talked to everybody there and found that they are all very well pleased with it. It is going ahead very well. This is an ideal site for an industrial estate. There are excel-dent communications by sea, road and rail, and there is a first-class, adaptable, hard-working labour force, living both in the hon. Member's constituency and in mine.

The only comment I should like to make is that the existence of that industrial estate should be made much more widely known and that it should advertise itself more. As it is, one cannot see that it is there until one is actually in it. There are great possibilities for the whole of that area. But, as the hon. Member said yesterday, the rate of unemployment at the moment is 6'3 per cent. which is very high indeed. It is, in fact, one of the black spots.

Mr. Manuel

May I remind the hon. Gentleman that, repeatedly, I have raised this problem of the Kilwinning Industrial Estate, as I have that of the R.O.F. establishment at Oban, during my five years' previous membership of this House and have raised it again since I came back. The matter has had the widest publicity and as much salesmanship as I can give it, but we still cannot get tenants to come forward to take up factories on that estate.

Sir F. Maclean

I hope that the "plug" we have given it today may help.

I should also like to mention, while we are talking about Ardrossan, a site which has been occupied by one Service Department or another for some time. It is in the docks and is an excellent site for a factory, with excellent communications, as I am sure the hon. Member knows.

We have to remember that the powers of the Government in these matters are limited. I was interested to hear the speech of the Leader of the Opposition yesterday, and to observe that he did not advocate the direction of labour or the direction of industry. He simply said that the Government should make greater use of the powers they have, which is easy enough to say, but not all that easy to put into practice. But, although the powers of the Government may be limited, I think that there is one field in which they can do a great deal. This is something which has already been referred to in this debate, and to which I myself have referred in this House previously. It concerns the matter of research and development.

We in Scotland have not got our share of research and development work. As the figures quoted yesterday show, we have 9 or 10 per cent. of the labour force and only 2.7 per cent. of research workers.

Mr. McInnes

And 10 per cent. of the population.

Sir F. Maclean

Yes, 10 per cent. of the population and 9 per cent. of the labour force. One thing that is certain and is generally accepted is that research and development do bring industry in their train. Not only that, but they bring the sort of industry that we need in Scotland, namely, science-based industry, which is ideally suited for our purpose and also for our labour force, with it adaptability and its special skills.

It would also help to provide jobs for the scientists who are now draining away in such a deplorable fashion from Scotland. We produce proportionately twice the total number of university graduates, as compared with England. But 60 per cent. of our science graduates and 40 per cent. of our engineering graduates leave the country, not because they want to, but because of economic necessity. This is a deplorable state of affairs, because we need these men, and they want to stay. There should be a job for them to do in Scotland, yet they are drifting south of the Border or overseas.

Therefore, I think that the Government have here a great opportunity. After all, the Government finance 70 per cent. of all the research and development in this country, and, to that extent, they control 70 per cent. of all the research and development. They also control the number of Government-owned installations in institutions, and though it may not be possible for the Government to direct industry it is quite possible to direct these installations to Scotland. But, instead of this, there is tendency for them to snowball in the Home Counties. This is a tendency that must be broken. It is a circle which has become more and more vicious as it goes on. Once this vicious circle was broken, we should soon see a very welcome reverse process of snowballing taking place in Scotland.

I should now like to turn to another problem in which, though perhaps I am not officially concerned, I am personally very much interested: the problem of the Highlands. I do not represent a constituency which is officially regarded as a Highland constituency, but in my view parts of it have a definitely Highland character. In any event, all hon. Members will agree that without increased prosperity in the Highlands we cannot hope to have prosperity in Scotland as a whole. It is all part of the same problem.

I do not share the predilection of most hon. Members opposite for State intervention as such. I should be more inclined to take the view of the hon. Member for West Stirlingshire (Mr. W. Baxter), who accepts the fact that we have a mixed economy, and who, in an interesting speech, tried not to take a doctrinaire position.

Miss Herbison

We all accept that.

Sir F. Maclean

I am relieved to hear it, though there are times when it is less obvious than at others. In any case, I am prepared to accept that a certain amount of State intervention is needed in the Highlands.

Miss Herbison

Hear, hear.

Sir F. Maclean

I am sure that that is generally recognised and that my right hon. Friend the Secretary of State recognises it.

Mr. Ross

The hon. Member and his hon. Friends voted to spend money to deal with the problem of red deer in the Highlands, but they are not prepared to take action to get the jobs by spending Government money in the Highlands.

Sir F. Maclean

That is exactly what I am advocating. There has been a lot of talk, both in the House and yesterday in the Scottish Grand Committee, about landlords and sporting gentlemen. I do not want to be offensive, but I recall that it was the right hon. Member for Clackmannan and East Stirlingshire (Mr. Woodburn) who talked about "romantic nonsense", some years ago, when it was suggested that deer forests could be made to carry a large number of cattle.

Mr. Willis

I have not heard anybody make that suggestion in the course of the debate either today or yesterday.

Sir F. Maclean

There were a lot of allusions to sporting gentlemen and to landlords. Some of the landlords in the Highlands have done a very good job indeed in increasing the cattle and sheep stocks.

Mr. Woodburn

In his articles in the Scotsman, the hon. Member repeated this fantastic story. The "romantic nonsense" was not referring to that at all. It referred to the statement that hundreds of thousands of cattle could be bred on the hills of Scotland. All I pointed out was that anybody who knew anything about the Highlands knew it was impossible to breed any more cattle than winter feed was available for and that it was romantic nonsense to picture hundreds of thousands of cattle marching down to Larbert from the Highlands. If the hon. Member knows anything about the Highlands, he knows that what I said is true. Every farmer knows it.

Sir F. Maclean

The fact remains that the cattle population has increased very largely, much more than the right hon. Gentleman expected. It is also a fact that 150 years or so ago, the cattle population in the Highlands was almost exactly the same. There were, if not hundreds of thousands, certainly tens of thousands coming down to the Falkirk Tryst every year. I invite the right hon. Gentleman to look again at HANSARD and see what he said. I was careful to look at it before I wrote the articles to which the right hon. Gentleman has referred and again after he raised the matter in the Scotsman.

Mr. Woodburn

The hon. Member has not read them accurately. The success of the breeding of cattle in the Highlands was because the Government of which I was a member put £300 million into agriculture to provide money to repair the hill sheep farms, to improve the stock, to build up the stock and to enable farmers to carry on for several years to increase the cattle population. It is the success of our policy that the hon. Member is talking about. It is still romantic nonsense to say that we can keep any more cattle in the Highlands than the quantity of winter feed permits.

Sir F. Maclean

I agree that it is also possible to increase the amount of winter feed that is available. We are getting a little away from industry, except in so far as I regard farming as the basic industry of the Highlands. I do not question that the right hon. Gentleman was right in that policy, but his remarks showed that he was labouring under a misapprehension as to what could be done.

Mr. Woodburn

Any farmer knows that the number of cattle that can be bred in the Highlands depends on the quantity of winter feed.

Sir F. Maclean

I know that perfectly well; I farm in a small way myself. It is, however, possible to increase the amount of winter feed by land reclamation, which is my next point. That is why I agree with the right hon. Gentleman that what is needed is a certain amount of Government intervention and help in that way.

Land reclamation in the Highlands should be on a large enough scale to keep down costs. That can be done not by State farms, or anything of that nature, but by Government help in kind and Government help by means of equipment, research, and so on, over large areas. When it is done on a small scale, we do not get nearly such good returns from our money as if it is done on a large scale. I hope that my right hon. Friend will examine the possibility of a pilot project, just as there has been a pilot project in tourism, for developing areas where land reclamation would produce good results.

Research can be carried a good deal further. I do not know whether it would be in order for my right hon. Friend, when he replies to the debate, to mention a purely farming matter, but I should be interested to know the Government's attitude towards bracken spraying. In my constituency, in Bute and Arran, widespread experiments have been carried out with bracken spraying. I have been told that they have been 80 per cent. successful and I am wondering whether the Government are considering making a subsidy available for bracken destruction by means of spraying and whether they would be prepared to help with spraying equipment and particularly with suitable aircraft.

The same need for Government intervention applies to the tourist industry in the Highlands. I welcome what is being done by Mr. Hugh Fraser. It represents a start, and a very useful one.

Mr. Emrys Hughes (South Ayrshire)

Which Mr. Fraser?

Mr. Bence

The take-over bidder.

Sir F. Maclean

There is in the Highlands a need for capital. There is a lack of capital al: present. Here I must declare an interest. I own a small Highland inn.

Mr. Rankin

A "pub".

Sir F. Maclean

Yes, a "pub". It is very difficult for a "pub" owner, or a hotel owner, to pay for improvements and extensions out of profits. We are always being asked to put in more bathrooms and do this and that. It is very difficult to pay for such improvements when the hotel is earning for only three or four months of the year and breaking even or losing money for the rest of the time. It is difficult to find the capital.

Unfortunately, it is also difficult for a hotelier to get a B.O.T.A.C. grant under the Local Employment Act. It is difficult for him to show that, by putting in a couple of new bathrooms and thereby possibly attracting American tourists and others, he is providing increased employment. In fact, that is exactly what he is doing, because one of the great points about the tourist industry is that it not only helps itself and provides employment to those working inside the tourist industry, but it provides employment to the farming community, furniture and equipment manufacturers, and a wide range of other industries. That is why I hope that before long the help that is at present being given only in the two pilot areas will be extended to the rest of the Highlands.

Everything that I have said about farming and about the tourist industry in the Highlands applies to an even greater extend to industry as such. I am convinced that the real answer in the Highlands is the small concern employing 20 or 30 men. There may be isolated cases where a larger works or factory is possible. I have always liked the idea of a pulp mill, or some such enterprise. I hope that it will not be too long before we get one in the Fort William area, or elsewhere. Apart from that, the answer lies in small local enterprises. That is exactly where the Local Employment Act should help. When we were debating that Measure in the House one of the things which was very truly said, both on the Floor of the House and in the Press, was that it was a good enough instrument, but that everything depended on how it was used.

I want to give one illustration of the way in which it has been used, or, rather, not used, which has disquieted me very much indeed. This is not a case arising within my constituency. Neither is it a case in which I have any personal interest. I make no apology for quoting it, because it illustrates extremely well the sort of instance in which help should be given, but in which unfortunately help in this case has not been given.

Dr. Dickson Mabon

I tried to follow what the hon. Gentleman said earlier. Now that he is discussing the Local Employment Act perhaps he will clarify this point. He alluded to difficulties which hoteliers had in developing their own premises and consequently attracting more tourists. The hon. Gentleman said that if they were able to expand in the way he mentioned they would provide more employment. I am not sure whether he was referring to that under Mr. Hugh Fraser's various suggestions, which he has made public in various statements, or whether he was referring to the Local Employment Act.

Before the hon. Gentleman goes on to give us his illustration, will he say whether he knows of any hoteliers who have applied for what he has been suggesting and who have been turned down? I understood that hotels were mentioned in the Local Employment Act.

Sir F. Maclean

Hotels certainly are mentioned. I was referring to the Local Employment Act. The criterion is whether the work contemplated brings an immediate increase in employment. By that criterion it is very difficult, though not impossible, for a hotelier to qualify. Under Mr. Hugh Fraser's schemes things are made easier for hoteliers, but that applies only to the pilot schemes. That is why I said that I hoped that that project would eventually be extended to the whole of Scotland.

The case about which I want to tell the House is that of a village joinery. It is a small firm that has gone from father to son for 150 years. No one can say that it is not firmly established or financially sound. Three years ago the firm employed eight men. Since then, during the last three years, in addition to the joinery business it has started to make bungalows. It now employs 16 men. The firm is on a small scale, but it is the small employers who can help in these circumstances. It now employs twice the number of men it employed three years ago.

The firm has done this without any help from anyone. One of the reasons why it is so successful is that it makes the bungalows out of local timber originating from the Forestry Commission, locally seasoned, and prepared by the local saw mill. Therefore, there are, practically sneaking, no transport costs and it is able to offer a highly competitive price.

That is exactly the type of enterprise which should be encouraged, if not for its own sake and for the employment it provides, then for the sake of the Forestry Commission. The plantations of the Commission are now beginning to come to maturity all over Scotland, and certain problems will be encountered in disposing of the timber. This is the sort of business, like the pulp mill, though that is on a much larger scale, which provides the answer to the problem. Apart from its intrinsic value, it has the additional value of helping the Forestry Commission.

At present, the joiner has on his books orders for £20,000. Those are orders selected from a much larger number. The only reason why he cannot carry out all these orders as promptly as he would wish is that he has not got sufficiently large premises. He has plenty of labour available. He can employ, and would employ, 25 men instead of 16, which would mean that in three years he had trebled his labour force.

The joiner himself is an elderly, but active, man. The future of the business is assured. He has a daughter and a son-in-law who are both trained, one in an architect's business and the other as a skilled joiner. All that he needs to get those premises is a loan of £5,000. I suspect that if he had applied for a loan of £50,000 or £500,000 he would have stood a much better chance of getting it, because it would have attracted more attention. But his application for a loan of £5,000 at 5 per cent. has been turned down flat. It does not make any sense. This concern is financially and administratively sound. Its past is known to everyone. Its future is assured. It can help locally in a number of different ways. It provides extra employment. It stops depopulation, people drifting away from the village.

Mr. Emrys Hughes rose

Sir F. Maclean

Just let me finish.

I realise that the ultimate decision on these matters lies outwith responsibility of the President of the Board of Trade, so I do not propose to press him to do anything about it. Otherwise, I should certainly have pressed him to look at this case again. My only hope is that there are not a lot of such cases, for I believe that, properly used, the Local Employment Act is a good instrument, and that in this sort of case, given the initial impetus required, could do much to solve the Highland problem.

Mr. Emrys Hughes

Before the hon. Member leaves that point, perhaps he would answer this question. Mr. Hugh Fraser borrowed £10 million from a Scottish bank to acquire Harrods, in London. Cannot the joiner get the £5,000 from the same source?

Sir F. Maclean

He can get it, but at a considerably higher rate of interest.

6.30 p.m.

Mr. Cyril Bence (Dunbartonshire, East)

For the last nine years I have attended and enjoyed our debates on the Scottish industrial and employment position, and I have watched the scene, and sometimes taken part in it. Right hon. and hon. Members opposite have always started from briefs provided by the Scottish Department—very bad briefs, because these briefs never reveal anything, and briefs, at least, should reveal something.

For eight years, we on this side have attacked the Establishment. We have accused them of failing to solve this frightful social problem in Scotland. They themselves admit that though, in part, they are quite satisfied with the position, they are not satisfied to the degree that they should be. We, on our part, admit that the Labour Administration did not succeed to the degree that we had hoped to succeed. Here we go, blaming one another for the failure to solve Scotland's social and economic problem, but on this occasion I have felt a little disgusted at the failure to expose in this House Scotland's position relative to that of the nations of Europe.

In Germany, in France, in Italy—everywhere in Europe—there is a tremendous surge. Unemployment is disappearing altogether, but Scotland, as a nation, is the worst off of any nation in Europe in industrial expansion and development. Let us not compare today with yesterday; let us compare Scotland's position in the expansionist world in which we live. In Europe, in the Common Market, all over the world, there is and has been expansion everywhere except in Scotland during eight years of Conservative Administration.

Hon. and right hon. Gentlemen opposite cannot solve the problem. We cannot solve it. We blame them, they blame us, but there is one group of people—the industrialists and the financiers—who, admittedly, hold and control the instruments that both sides of the House are begging them to use to solve this problem.

It has been rightly said in this debate, by my hon. Friend the Member for Glasgow, Central (Mr. McInnes) and by others, that what we need is salesmanship. The Scot can sell himself to anyone in the world except to the Scottish financier and the Scottish industrialist. That is where he fails to sell himself—in his own country—because the Scottish financier is not interested in financing the instruments of production in Scotland.

He would rather get that £10 million and buy a business, probably built by a Scotsman, in Knightsbridge, London; built by a hundred years of the thrift and energy of a Scotsman who may have emigrated here. The Scottish financiers buy businesses like that and make fortunes out of them, but will not provide the £5,000 needed for the enterprise mentioned by the hon. Member for Bute and North Ayrshire (Sir F. Maclean).

There is no private enterprise in Scotland—that is what we are suffering from. I was a bit of a private enterpriser myself in the days when I worked in the motor companies, although I now use a box of matches. But if I got caught I was in trouble, and as soon as anybody in Scotland starts a bit of private enterprise in the motor industry, the electrical industry, the chemical industry he, too, will find himself in some trouble.

A friend of mine, a director of an engineering company, wanted to service motor car engines and to repair motor cars. He wrote to the motor companies asking whether he could get discount on cylinders, piston rings, crankshafts, axles and all sorts of things like that. They replied, "Certainly, if you are a member of the Motor Traders' Association." He therefore wrote to the association asking to join. It replied, "Certainly, if you provide petrol and free air for the motorist." So he wrote to the oil companies asking whether he could have pumps put in. They replied, "Certainly, if you are a member of the Motor Traders' Association." He has never been a member of the association—he cannot get in. Not far from him, one of the oil companies has a big service station.

I worked for years in a company, the chairman of which looked upon private enterprisers in his product as buccaneers and spent all his life as a director of a company getting rid of them, until only one was left.

Private enterprise is finished. The private investor with liquid resources is not interested in building new plant, but in watching the stock market to find shares that might appreciate so that he may make a capital gain on which no Income Tax is paid. He is not looking for engineers or scientists with new techniques of production. At least, he is not doing it here, but it is being done in America and in the countries of the Common Market. There, they are looking for men with creative ideas, but here the private investors look for fixed established assets that might show capital appreciation. The financier here is not interested. He is tied with the industrialists, and he has the market tied up, the productive processes tied up, and has been doing his darndest to see that no one else comes in and disturbs the peace.

It all reminds me of what was written by a politician whom I have always admired tremendously; the founder of the Primrose League, a great statesman and, in my view, a literary giant. He coined eight thousand new words in the English langauge. He wrote a book called Coningsby. Coningsby was a student at Oxford, and the nephew of the Duke of Monmouth. Coming down from Oxford to Monmouth he stayed the night at a Wiltshire inn. There he met a gentleman named Sidonius.

The two men had a discussion, and Sidonius asked Coningsby a lot of questions about his three years at Oxford and about what he now intended to do. Coningsby replied that he was going into Parliament. Sidonius told him, "You will have to have ideas if you go into Parliament." Coningsby said, "No, my uncle says that I must not dare to do that. He assures me that if I have ideas I will get into trouble. He says, 'Just you go in and behave yourself.'"

There was a lot of discussion like that, during which Coningsby said to Sidonius, "Excuse me, you are not English, are you?" Sidonius replied. "No, I am not of any nationality. I do not really support any nation." "Good gracious me", said Coningsby, "you are a citizen of the world?" "Oh, yes", said Sidonius, "I can almost say that I control the world." Said Coningsby, "Are you a king?" "No". said Sidonius, "I hate kings, I drag them down." This was written by Disraeli, the founder of the Tory Party. At the end of this dialogue Coningsby said, "You have almost as much power as the Almighty." "My good man", said Sidonius, "I have much more. I am a financier."

The financiers of Western civilisation, and in this country in particular, in their attitude to productive processes supported by Government policy, are frustrating and crushing British productive processes at such a rate and in such a way that the Common Market will be ahead of us as an exporting unit in Europe. We have seen the reports of what has happened to Vauxhall Motors. There has been a 30 per cent. cut in their sales. By what is that being replaced? Not by private enterprise, from the Common Market, but by Renault, the finest State motor factory in the world. I get tired of this idea that we must not have State intervention, that we must have State intervention only when capitalism fails. Why should we not have State intervention even where capitalism is successful?

Capitalism has failed to solve our social problems. It has succeeded in producing goods and services, but it has failed to get them distributed and sold. We pay cash in taxation to maintain the illusion of a successful private enterprise, and when the majority of the people want a car they can only buy it on hire purchase. Every year funds collected from the people of this country are being used to sustain the illusion of private enterprise, when there is no such thing. Private enterprise in Western industry is piracy to those who are in the saddle. Everything is done to prevent it. These people sit in bank chambers. They take no risks, except the risks that they take with other people's money. Financiers do not use their own money they are not so daft as that. They know all the techniques.

Both Governments have failed to solve this problem because the industrialist and the financier do not respond in order to meet this social problem. There is the failure. The failure does not lie with the Administra- tion as such. The people whom we are asking to solve the problem cannot do it. If one accepts capitalism as a means of social production, then the function of the people who indulge in it is not to solve the problem but to produce goods and services. When I heard the President of the Board of Trade talking about increased costs arising from transport charges I was amazed. In the plant in which I was engaged we used to manufacture little units of all kinds for refrigerators, washing machines and similar articles. They were boxed up in cartons and sent to I.G. Farben and Brauns in Germany. The Germans assembled these parts in washing machines, radio sets and so on which were then put back on the London market. These things had gone all the way to Germany and come back again.

This little island is a dot compared with the United States, or Europe as a whole, and yet we talk in Westminster of remote places. This is the frightful nationalism of the English. They talk about Wales, but, of course, Wales is not remote at all; neither is Scotland. This is a lot of nonsense. We build new towns in Scotland and ask for new industries to be recruited from areas where there is already unemployment. This must be done by means of positive action. We would do it if war came. For strategic reasons we could get 1½ million people from this area into Scotland, working like mad. For most desirable social reasons, we should take radical steps to get 1½ million people from this city, which is becoming choked, and move them into areas like Scotland. I believe that there are 5½ million people in the whole of Scotland, while there are 15½ million packed tight in this little area.

A production engineering plant, producing at an ever-faster rate, is finding it difficult to get the products away from the factory. The industrialist will not do it. I am not condemning him. He probably cannot do it he has got to obey the laws of capitalism. He has got to get his overdraft and pay the interest on the overdraft. Then we get a credit squeeze and he has got to draw his horns in. As for this statement by the President of the Board of Trade that the credit squeeze, which is intended to clamp down consumer demand, will increase the tendency for the creation of new capital, I have never heard so much nonsense in all my life. What a shocking brief; what a shocking Minister to say a thing like that. That did not reveal his capacity. It revealed his inadequacy.

Anyone who has worked in any capacity in the engineering industry knows that if one goes to the directors with a new scheme for expanding production and the returns show that the demand is going down, they reply, "What do you think we are—a philanthropic institution? We are not spending any more money—not on your life." That is why in 1938 I was controlling machines which were built in 1898. If we had had expansion in the demand for consumer durables after 1919 I do not doubt that we would have had brand-new machines by 1925. If we clamp down on the demand for consumer durables, the owners clamp down on increasing production of the goods. As an economic theory, that may sound very nice but I have never been enslaved by theories. It is the party opposite who are the slaves of theories, not us. We are becoming much more radical. We want radical solutions.

The trouble with the party opposite is that they are enmeshed in a tortuous system of half-baked theories. First they say, "There must be no intervention by the State." Then they say, "There must be some intervention by the State." They say, "Do not take this over; it will ruin the country." Then they say, "Take it over" and, having taken it over, they say, "Give it back." Then when they give it or sell it back, the man who has bought it goes to his club and says, "I have just got a bargain. I bought £5 million worth of shares. I think they will be worth £8 million soon. I bought them from the Board of Trade for £4 million." Then the Minister tells us, as he told us not long ago, that when they sold some shares they made a good deal. They had sold them cheaply.

My father would have killed me if I had sold something under its value. But they do it regularly. They sell something for £1 today, and it is worth £2 tomorrow to their pals—free of tax, of course. It is only we poor mutts who pay Income Tax. We are finding all the money which is flowing to capitalism. The capitalist himself is not worried about income; he gets it in capital gains.

There was never such a racket in any century of man's history. It is a most extraordinary thing. I am sure that, if we established contact with the moon and there were a man on the moon, he would say, "Good heavens, you have not come from that place down there, have you? The only time you seem to be prosperous is when you are fighting each other, and, when you stop fighting each other, you seem to have a rough time."

We are talking about a country where there is poverty, but it is a country which produces the cleverest people in the world, brilliant engineers, fine people, yet nobody in that country seems to want to buy the benefit of their work. I want to know who is frustrating them. We all know that Scotsmen have gone all over the world. They can do anything anywhere. They helped to build the Commonwealth. But there is somebody stopping them building Scotland. Who is it? I am sure it is not the right hon. Gentleman the Secretary of State; he is too generous. But who it it? Who in the name of fortune, is stopping these clever Scotsmen from developing Scotland? [Interruption.] I am sure it is not the hon. Member for Glasgow, Kelvingrove (Mr. Lilley). Who is doing it? It is the industrialists and financiers.

I know that there are some industrialists in Scotland who spend a lot of money on research and who do a great deal of development, but, in general, the effect is not there. Paterson, who founded the Bank of England down here in London, was a Scot. That is where the trouble lies. Usury is the easiest way to make money. There is no easier way of making money without working than usury. Paterson made a fortune. Murdoch, who came from Dumfries, and James Watt, who came from Glasgow, came down to Birmingham and built a factory in Smethwick. They made some of the first machines in the world. They had a nice house in Heath field near Birmingham, but they died in poverty. They were engineers. But the other fellows, the financiers and the bankers—has anyone ever seen a poor banker?

The office of John Brown, controlling a huge shipyard building the finest ships in the world, is a poky little place. Let anyone go and look at the Prudential buildings and the banks. There has never been an absolute monarch in the world who built palaces to compare with what the financiers have built for themselves. They are the people who control our economy. We shall never solve the problem and we shall never bring justice to the people of our country, whoever they may be—the executive at the top or the labourer on the floor—until this House, this institution, takes control of the financing of industry and decides that, in the national interest, the State shall intervene in order to ensure that the men born in Scotland who have no land but who have a right to labour and who have no subsistence without their labour are able to exercise their right to labour as they are entitled. It is the duty of Governments to see that they do labour if they are willing to do so and that they receive fair rewards for it.

6.55 p.m.

Mr. Gordon Campbell (Moray and Nairn)

The hon. Member for Dunbartonshire, East (Mr. Bence) has made a most entertaining speech—

Mr. Willis

And a true one.

Mr. Campbell

—in his usual engaging manner. I shall find it difficult to follow him and to be as amusing. I particularly liked his story from "Coningsby" of the politician who came to Parliament and was told that he need not come with ideas. I congratulate the hon. Gentleman because he obviously came with many ideas, but, having heard him, I must say that some of them are very queer ones.

Mr. Bence

It is better to have queer ones than none at all.

Mr. Campbell

I agree entirely, but I noticed in the hon. Gentleman's speech a complete lack of any positive suggestions about what should be done.

Mr. Bence

Let the Tories get out and let us get in, and we will do it.

Mr. Campbell

The hon. Gentleman told a story from a book by a very famous statesman, Disraeli. The time he was speaking of was more than one hundred years ago. In passing, I would say that it was because he was capable of writing such a book, and another called "Two Nations", that he subsequently started some of the very necessary social reforms carried out in the last century. I assure the hon. Gentleman that I enjoyed his speech exceedingly and I assure him, also, that I shall not follow any brief whatever in my speech, if that is any comfort to him.

I agree with hon. Members on both sides who have pointed out the weakness that there has been for many years in Scotland because of dependence upon a few industries, upon some old industries and upon heavy industries. What is required for the long-term benefit of Scotland is a much greater variety of industry. Therefore, I welcome, as have other speakers, the proposal now being put into effect for a strip mill and for the motor car industry, the B.M.C. factory, to come to Scotland shortly. As a consequence of these events, there should be a wider range of industries.

I know that when other industries come later, he industries using the products of the strip mill and industries ancillary to the motor car industry, the industrialists will find that they have available the best kind of labour, the best employees that they could find anywhere in Britain. They will find that very hard work will be done by their employees there and they will have no regrets over coming to Scotland. The potential of skill and knowledge in Scotland is great. As the hon. Lady the Member for Lanarkshire, North (Miss Herbison) said, the proportion of persons going to university is higher in Scotland than anywhere else in Britain.

Much has been said about the major problem of bringing more industry and a wider variety of industry to Scotland, and I wish to turn to some considerations which affect more particularly the North and North-East, which is the part where my constituency lies. We cannot expect a car factory to come there. It would not help us in our problems; it would probably cause more. There are, nevertheless, opportunities for light industries of a smaller kind, provided that they do not depend on very heavy raw materials or produce very bulky products.

There are many industries, particularly in scientific and technical work, which make small products and for which the transport difficulties are not great. The effectiveness of operating in the North-East of Scotland is demonstrated by the industries which are there at present. They have flourished and they have not regretted coming. A very high standard of labour is to be found, as has been discovered by the industries which have gone there. Rating in the Moray Firth area is low. It has been suggested that management and any necessary experts might not wish to go so far North, but it is a congenial area in which to live and many who have gone there have settled.

Much has been said during the debate about depopulation in the North of Scotland. I am glad to say that in Morayshire the population is increasing. When one considers where Morayshire is situated, bordering upon the area which is administratively called the Highlands and well to the north, it can be seen that depopulation is not necessary. It is not a natural phenomenon of the area. The increase in population is the result of the efficiency of the industries there and of the hard work of the people working in them.

Those who go to the Moray Firth area will find a benefit which is not widely enough known, namely, the excellence of the weather. If a person wants to get away from fog, he does not have to go abroad. This was discovered by the Armed Forces. To the advantage of the area, we have large airfields of both the Royal Navy and Royal Air Force, and they have provided employment and are expanding. Houses are being built for the families of the Service men. The Services found during the war that more flying hours are, possible in that part of Britain than anywhere else. Figures have recently been published showing the number of sunshine hours in Britain last year. Places in the Moray Firth were again right at the top of the list.

This has an effect on the tourist industry. Tourism cannot be a primary industry for Scotland. It is a secondary one. But, nonetheless, it is very important for the area about which I am speaking and similar areas. It is also important that a second season should be encouraged. The summer season greatly assists the area, but there are great possibilities of a winter season, and these are being developed. I refer particularly to winter sports.

When one studies what has been done in Central Europe, in countries like Austria and Switzerland, to develop that side of the tourist industry and then considers how the economies of those countries have benefited from it, one can see what can be done in Scotland to develop the winter season, although on a smaller scale. All the facilities are there except the fixed equipment. I am glad to say that since we last debated this subject it has been announced that a chair lift is to be built in the Cairngorms towards which the Government made a grant of £5,000 in addition to the large number of donations given by private persons. That is a beginning. There is no reason why there should not be further developments in this sphere to provide a season of more than three or four months which my hon. Friend the Member for Bute and North Ayrshire (Sir F. Maclean) called the hotel and holiday season. Already the season is being extended in the winter sports area.

Another industry which can flourish and provide employment in this area is forestry. In almost all the places where forests have been planted more employment has been provided. For example, on land used simply as rough grazing for sheep the number of men needed for several thousand acres is small, but when that land is planted for forest—and much land can be so planted—then it is much more productive and provides employment for many more men on the same acreage. The forestry industry was badly dislocated by the war. Huge quantities of timber had to be felled in the emergency and the high standard of forestry which normally would have been carried on could not be continued because men were required for other jobs. That is now being put right. More forests are being planted, but much still remains to be done in the organisation of the industry as a whole. I welcome the formation of the woodland owners' associations which the Government have encouraged in Scotland and the rest of Britain so that owners are much more co-ordinated and can have a body similar to the National Farmers' Union in touch with the Government.

There is also more to be done in the home timber industry. This is a long-term problem. In the forestry industry one thinks, I understand, in terms of sixty years or more and it is not much good growing large areas of forest if there will be difficulties in selling or making use of it. As the forests improve and the products reach higher standards, to compete with the high standards of countries abroad which were not so affected by the war, our home timber industry must be modernised and better organised. I ask the Government to give every encouragement to this industry because of its employment possibilities in the North of Scotland and the Highlands besides its economic importance to the country.

I wish to say a word about the distilling industry, which is doing a splendid job in the export trade. I think that it has increased its exports every year since the war. It works with steady efficiency and uses a very high standard of skill and craftsmanship in the Highlands and the North of Scotland. The contribution which it makes is sometimes overlooked.

I now want to say something about the European Free Trade Association which we joined during the past year. I do not think that it is a service to Scotland to deplore our joining this Association of the Seven.

Mr. Bence

We should join the Common Market.

Mr. Campbell

I think that both sides of the House hope for an even closer association. We should not necessarily join the Common Market, but we definitely want a closer association. If it means disadvantages to a few industries, then I think that this must be faced. One of the industries in my constituency is fishing, and I am very much concerned about the possible disadvantages to it of the European Free Trade Association. But because the prospects of trade arising from joining the Association are likely to help other industries in Scotland, particularly industries in the industrial belt of Scotland where the unemployment situation is serious, I think it is important that we should support the Free Trade Association and not make a fuss because one or two industries may find that difficulties will arise from it. I agree very much with what the hon. Member for West Stirlingshire (Mr. W. Baxter) said. I believe that he foresees difficulties for the paper industry but he also agrees that it is for the benefit of Scotland as a whole that we should be a member of the Free Trade Association.

The way to deal with problems such as those which arise in the fishing industry is to give special help where it is required. It did not surprise me, therefore, when it was announced two weeks ago that the white fish subsidy had been increased and that something similar was to be done in other sections of the fishing industry. That seemed to be a recognition of the difficulties which the industry might have to face in future. A second point is that the Free Trade Association has as its members the Scandinavian countries. The proximity of Scotland to these countries opens up further possibilities for Scotland, and distances are shorter than from other parts of Britain.

We cannot be satisfied until the unemployment percentages in Scotland are down to the same level as in Britain as a whole, or lower, but I believe that the steps now being taken towards this end are sound.

7.10 p.m.

Mr. William Ross (Kilmarnock)

We have listened to a disarming speech from the hon. Member for Moray and Nairn (Mr. G. Campbell), who confined himself mainly to the conditions in his own area. Most of us would agree with much of what the hon. Member said, particularly when he spoke of the need for an area like his own to get a measure of variety of small industry and certainly not, as the hon. Member fully realised, large-scale industry.

The trouble is that that is just the thing that the Government's policy will prevent. We had it from no less a prophet than the President of the Board of Trade yesterday that the credit policy is aimed at cutting back expansion in the lighter industries. We must face the fact that that policy endangers some of the things that have been claimed as successes for the Government over past years. Therefore, not only will we not get so readily the expansion of the small industries into areas that are relatively remote, but industries which have been brought into Scotland will be endangered by this policy.

My hon. Friend the Member for Greenock (Dr. Dickson Mabon) can tell us about what is happening to the Acme Wringer Company. We all know, from what we have been reading, what is happening to the Hoover Company, in Cambuslang. As a result of the Government's policy—and the Government have proclaimed their success in bringing some of these industries into Scotland—production is running down.

I have not heard one hon. Member on the opposite side attacking the Government's policy. When we on this side attacked their policy for knocking Scotland down at the moment when we seemed slowly to be rising, we were told that we were grousing and gunning. I warn the Government that if we on this side were not raising our voices against their policies that are inimical to the progress of Scotland, we would not be doing our job.

Do not let the Secretary of State forget that he is Secretary of State for Scotland only by the grace of Tory English votes. At the last General Election, the people of Scotland returned a majority of Labour Members from Scotland. Hon. Members opposite, therefore, are not the Government party by the will of Scotland. They are in false disguise and I do not see many of their English supporters here to cheer them on in their attack upon the policies that are not assisting Scotland's progress.

We were told by the President of the Board of Trade that 1959 was a vigorous year of expansion in Scotland. In the same speech, he told us that expansion over the whole year amounted to 1 per cent. The fact that there was greater expansion at the end of the year meant that for the greater part of the year there was not expansion, but decline. This slow measure of recovery was after being knocked down by the policies of the Government in 1957.

From the Government's present policies, we can only expect that the situation in Scotland will get worse. Will the Secretary of State tell us how many unemployed there will be in Scotland in February next year? It was wonderful how charmingly the Minister of Labour came along today and stuck to his brief in relation to his Department. He told us that be would put us fully in the picture and he chose his comparisons carefully. At one time, the comparison was between 1956 and 1959 and at another time, between 1959 and 1960.

The stark fact is that today, in the middle of summer, when figures should be lowest, they are as high as they were six years ago in the middle of winter and we have 20,000 more unemployed in Scotland than we had two years ago. This is the vigorous Tory expansion of which we have been told so much. We have "never had it so good". The Government did not use that slogan in Scotland during the election. For the first time since 1945, I was able to hold meetings at the employment exchange. The Minister of Labour and his colleagues assured me of a good audience.

The Tories told us that all would be well and that the Government would attend to this business and would introduce a new Measure to deal with unemployment in Scotland. They introduced the Local Employment Bill. We remember it well, because of the silence of hon. Members opposite. I believe that the hon. Lady the Member for Aberdeen, South (Lady Tweedsmuir) was in Australia at the time, but her colleagues never said a word about it. One quarter of the 70,000 unemployed in Scotland are in areas that can get no help and there is no guarantee that the others will get it. My hon. Friend the Member for Lanarkshire, North (Miss Herbison) will be able to tell us of a message which she received today about an industry in her constituency which was prepared to expand, but was refused assistance from B.O.T.A.C. despite the fact that it is listed.

Kilmarnock was in a development area from 1945 until the passing of the recent Bill. Within weeks of its passing into law, a firm which had been brought into Kilmarnock under the development area policy of the Labour Government, and which had expanded under that policy and contemplated a further expansion, was told that because of the passing of the Local Employment Act Kilmarnock was no longer in a listed area and, therefore, nothing could be done.

That is the attitude of the Government, who, we were told, would help in providing employment in a place which had over 1,000 unemployed. That is not the kind of thing one takes lying down. I had a meeting with representatives of the Board of Trade and I am glad to say that we made them see reason. In Ayrshire, there are 4,000 unemployed, over 2,000 of them being in areas which are not listed. It is crazy.

At a time when there were over 1,000 unemployed in Kilmarnock, the Scottish Tool Manufacturing Company, which had been in Kilmarnock for some time, but was never quite satisfied with its site and its factory, was able, with the help of the town council, to move from one side of Kilmarnock to another. The company is doing this out of its own finances and is not asking for Government help.

Here is a letter, however, which has been sent to the town council by the solicitor acting for the company. He states: We confirm that pressure has been brought to bear on our clients by the Board of Trade and other authorities to set up business in what is described as under-developed areas, such as Irvine or Dundee, in preference to Kilmarnock. That is how the Government are trying to solve unemployment in Scotland, by shifting a firm which is satisfied in Kilmarnock and which is prepared to use its own money in Kilmarnock, where there are over 1,000 unemployed, and saying, "We will build your factory if you move eight miles away".

Did one ever hear of such lunacy? This is an actual fact. If that firm had fallen for that, we would have been told about another project. We would have been told that there were more jobs in the pipeline. There is another project in the pipeline; it is listed among the projects. It is listed along with the number of people they are going to employ. It is Holyrood Knitwear, which is building a factory in East Kilbride. There are so many hundreds of new jobs in the pipeline. What does it mean? Holyrood Knitwear is already producing knitwear in Kilmarnock. It is shutting down there and going to East Kilbride. So long as there are all these additional jobs in the pipeline—and they are not additional jobs; they are replacement jobs—there: is no net gain to Scotland.

I wish that the President of the Board of Trade would be a little less clever. The more I hear from the right hon. Gentleman the more I realise how we failed to get better association with the Common Market. If he talks to the statesmen of Europe in the way in which he talks to this House we can begin to understand the difficulties that we are in. He told us that there were 39,000 jobs in the pipeline. The whole of Scotland is littered with pipelines. The Government produce a new pipeline with every speech. It gets longer and longer. It lengthens each year with every Scottish debate. There is quite a number of blockages and leaks in that pipeline. Indeed, if Glenfield and Kennedy had been producing pipelines for Government supporters it would not have been on short time for the last couple of years.

The right hon. Gentleman tells us that there are 39,000 jobs and that some of these jobs are approved, work is going on, and all the rest of it. He told us yesterday: The 23,800 jobs are firm, and we hope that the 15,000 will be added to them."—[OFFICIAL REPORT, 12th July, 1960; Vol. 626, c. 1221.] Within this 2.3,000 we have to take off those firms which are leaving one part of Scotland and going to another. So this 23,000 does not mean 23,000 additional jobs, once we analyse it. The Government say that 15,000 will be added to them. Where are these 15,000? The President of the Board of Trade is not sure that there will be 15,000. He told us that he could not guarantee them. He followed that up by saying that this seems to him to be the biggest contribution to Scottish employment that any Government had yet made. The only trouble is that the Government have not yet made it.

Of the 15,000, more than one-third is only a Presidential hope coming from the Board of Trade. We have had far too much of this before. We have heard all these figures. This is the ninth annual debate of this kind that we have had. I can remember the first of those debates, in 1952. We asked the Government to prepare a blueprint. The Government, on 23rd February, set the Scottish Council the job of producing a blueprint. "A Springboard for Prosperity" was. I think, the headline in the Scotsman on that date, when, at long last, the Council decided to go into the real reasons for the disparity in prosperity and employment between Scotland and the rest of Britain. It started that only this year, so that it does not know yet what is the true position.

The Government tell us, "Do not talk about Scottish unemployment. Do not talk about Scottish housing." The Minister of Labour says, "Do not call us callous." The Government have to face up to the consequences of their policy, and if their policy makes it difficult for local authorities to build houses for the housing needs of Scotland they have no right to complain if we say that they are callous. If their policies do not meet the employment needs of Scotland, they have no right to complain if we say that they are not looking properly after the interests of Scotland.

The facts are simply these. For nine years the Government have been applying more or less the policies and the powers that they have in their hands at present, and the unemployment position is worse than when they started. They place full reliance on saying "We must steer; we must not direct industry into Scotland."

I listened to the hon. Member for Bute and North Ayrshire (Sir F. Maclean). He did a wee bit of wandering in his speech. He got into agriculture and talked about land reclamation and pilot schemes. There was an hon. Member sitting beside him who made a similar speech years ago, and who got the Government to set about land reclamation and pilot schemes. The hon. Member for Caithness and Sutherland (Sir D. Robertson) can assure me that I am right.

When the hon. Member for Bute and North Ayrshire speaks we have to listen because he is supposed to become the next Secretary of State for Scotland. If he had taken the trouble to read the report of the Department of Agriculture for Scotland—although reading it was not even necessary; he had only to look at the picture in it—he would have seen that land reclamation had already been done there. He said that we must be careful, that we must not use State powers, and that we must steer gently. If we can steer industry as easily into Scotland as the hon. Member some months ago steered himself from an English Tory constituency into a Scottish Tory constituency, we shall succeed very well.

We have to face the fact: what do we do when we fail to persuade industry to come in to Scotland? That is the position we are in. We are failing. What I said about the hon. Member is quite true. A Tory candidate in Scotland said that he woke up one morning to discover that there was a candidate for a constituency where he did not even know there was a vacancy.

The position here is that the Government stop inducing industry into Scotland when a firm states that, in its commercial judgment, it cannot go to Scotland. Indeed, it is also the other way round. The same thing happens when a firm wants to leave Scotland, or take a department out of Scotland into England, and says that it makes its proposal as a result of its commercial judgment. It says not that it is in the interests of the people in the industry, the well-being of the area or the needs of the nation, but that it is simply as a result of its commercial judgment in relation to the profitability of the firm. Whether it is a matter of a firm going out of Scotland or being induced to come into Scotland, as soon as a firm speaks of its commercial judgment, the Government climb down. If they do it in relation to a small firm in Kilmarnock, did they do it in relation to the Ford Motor Company at Basildon?

My hon. Friend the Member for Dunbartonshire, East (Mr. Bence) was right about this. If we leave it to profitability or capitalism in respect of whether an industry goes or does not go to Scotland, it will not go there. So we get State carrots held out to them, and the State carrots need to be juicier and juicier. The Opposition are determined to get industry somehow or other to Scotland, and we urge the Government to do the same.

Let the Government appreciate the consequences of failure. What do they do next? Will there be direct State intervention to ensure that industry goes there? I am sure that if we made it profitable for private enterprise to go there, private enterprise would be more anxious to go there. I am sure that if the Secretary of State said to private enterprise, "If you do not go to Scotland, I will set up there the same kind of industry as you have", private industry would then quickly go to Scotland. We must look at these things from the point of view of the well-being of the people of Scotland.

What is coming? We shall have more unemployment this year. I can tell that from my constituency. Massey-Harris is to pay people off. That firm, too, is hit by the credit squeeze. There is also the factor of an increased number of children leaving the schools, and, therefore, there will be more juveniles for whom employment has to be found. There is also the factor that young men in industry will not now be leaving it to undergo National Service. This all means that more jobs must be provided.

There is also the factor of modernisation. Whether it be in coal mines, transport or any of our older basic industries, modernisation leads to the employment of fewer people. This will require the provision of new industry to maintain the employment potential at its existing level. Have the Government a policy to meet that problem in the coming year? I am sure that the answer is "No" However, apparently we are not to talk about it; we have all to be nice and quiet about it.

Yesterday, the President of the Board of Trade asked for criticism. He will get it. So will the Secretary of State. One of his friends was proclaiming in Ayr the other day that we have the finest Secretary of State that we have had this century. I am sure that the Secretary of State shivered as soon as he heard that. The last time that those words were used of a Secretary of State for Scotland was when they were applied to the right hon. Gentleman's predecessor, the former right hon. Member for Moray and Nairn, "Jimmy" Stuart, who is now Lord Stuart—he lost his job shortly after that. The man who said it should also be very careful, because the man who said it about James Stuart lost his seat and is now in the House of Lords.

I sincerely hope that the Secretary of State will appreciate the logic of the position, which is that the policies which the Government have pursued hitherto for Scotland have not been enough, that the overall financial policies are once again acting against the interests of Scotland. That is demonstrated by a further exten- sion of unemployment and an aggravation of Scotland's problems. The right hon. Gentleman will need to make a stand for Scotland in the Cabinet and ensure that we get special treatment, that we are not divided up into little areas but that Scotland is treated as a whole in respect of unemployment. If the right hon. Gentleman does that he will get not grouses but applause and support from this side of the House, as is always the case when we feel that policies are to the benefit of Scotland.

7.35 p.m.

Lady Tweedsmuir (Aberdeen, South)

Both yesterday and today there have been most detailed analyses of Scotland's problems by right hon. and hon. Gentlemen on both sides of the House. I will try, at this late hour, not to cover the same ground if I can help it.

I should like to refer particularly to the remarks made early in his speech by the hon. Member for Kilmarnock (Mr. Ross) on the question of the measures taken by the Government to counter any possible inflationary tendency. That has been running as the background of the whole debate. It is really the basic problem to which we have all to address our minds—how we are to achieve economic growth without inflation. If we look back we remember that between the wars we were tremendously absorbed with problems of very high unemployment. I think it fair to say that since the war we have been primarily absorbed with the problems of inflation.

I think that the Government will recognise that these measures, taken in the form of higher Bank Rate or credit squeeze, or whatever it may be, are blunt instruments. I ventured in the Budget debate to suggest that so far as the unemployment districts scheduled in the Local Employment Act were concerned—I do not go as far as the hon. Member for Kilmarnock in saying "all Scotland"—the Government might devise some form of selective measures.

After all, it has already been recognised by the Government that we have special economic problems in that in relation to the question of special deposits the Scottish banks are required to achieve only 1 per cent. while the English banks have to achieve 2 per cent. If that can be done in one respect, could it not be done by simply having, let us say, higher investment allowances—which is what we really want in Scotland—tied to the development districts?

I remember very well being told long ago, and on many occasions since, that the problem appeared to be insuperable because our economy is so interwoven that many of the problems of the Midlands will eventually affect us. For instance, if inflation were to affect us, the consumer and other industries in Scotland, that would do very great damage to our competitive position, and, as everywhere else, it would hurt all those who are on small fixed incomes.

However, in some of the younger developing countries of the world this problem of special areas where, for one reason or another, it is difficult to attract industry has been recognised by Governments, in the form, for example, of certain tax allowances over a period of years. I do not say that that has always been very successful, but we are a very much smaller country. As many hon. Members have said, distance is not really the problem. At any rate, I do not believe that it is if we are really determined to overcome the problem.

Since the debates on the Budget and the Finance Bill there have been widespread reports in a variety of newspapers to the effect that all the Government Departments have been asked to examine the possibility—and methods of achieving it—of having selective measures which would not penalise the unemployment districts. Therefore, while I realise that it is not the entire responsibility of the Secretary of State, it would nevertheless be interesting to hear from my right hon. Friend whether any examination is proceeding along those lines, because it is obviously of prime importance to us all.

The Leader of the Opposition, in opening the debate, suggested that the answer to the immediate problem in Scotland was that we should have State industries. At the same time, he said, in c. 1203 of the OFFICIAL REPORT, that he hoped that he would not be misrepresented as asking for either direction of labour or direction of industry. Therefore, I think that one is entitled to ask, if he does not wish to carry out either of those two measures, how he can operate State industry in the areas of high unemployment.

Mr. Willis

The labour is already there.

Lady Tweedsmuir

Hon. Gentlemen opposite suggest that the labour is there and that it would be a very simple thing, if any industry were put down by them by State intervention, to obtain all the skilled workers required and workers with experience. They suggest it would be a very simple thing indeed.

Miss Herbison

It seems to me that the noble Lady has posed a question the answer to which is very simple. Let her consider the industries which have been brought to Scotland under the working of the Distribution of Industry Act. Without any direction of labour at all the skilled, highly trained technicians have been found, without any trouble.

Lady Tweedsmuir

In that case, it seems that the hon. Lady is referring to the inducements and persuasions which we have already tried to carry out under the Local Employment Act, and, of course, if it is to the inducement and persuasion of industry to which she has referred, there is very little difference between the policy of hon. and right hon. Gentleman opposite and our own.

Miss Herbison

I just cannot believe that the noble Lady does not understand the point.

Mr. William Hamilton (Fife, West)

She jolly well does not.

Miss Herbison

The only point in the hon. Lady's speech that I took up was the question she raised that if we were to have publicly-owned industry we should have to have direction of labour. We would have publicly-owned, State-owned, industry and we should get the skilled technicians, and so on, in the same way as we have been able to attract them to any industry which has come to Scotland, and to attract them without direction at all.

Lady Tweedsmuir

I very much appreciate the help that the hon. Lady is trying to give me. I wonder whether she would be good enough perhaps to clarify my mind on one further point.

Mr. Willis

But she cannot make the noble Lady think.

Lady Tweedsmuir

The right hon. Gentleman the Leader of the Opposition suggested that there should be State industry in Scotland, but he also said that he did not wish it to be thought that he wanted to direct State industry to Scotland. [HON. MEMBERS: "No."] Would the hon. Lady, therefore, say what exactly he meant?

Miss Herbison

I must say that there are a number of my hon. Friends who want to speak in this debate and I wish that the noble Lady had been here to listen to my right hon. Friend the Leader of the Opposition, but since she was not here to listen, I do wish that she would read his speech and interpret what she does read.

Lady Tweedsmuir

Well, I read the speech of the Leader of the Opposition with very great attention and I submit to the House that it remains quite unclear what exactly is the policy which hon. and right hon. Gentlemen opposite would like to follow.

Mr. Ross

The noble Lady should stop proclaiming her personal limitations.

Lady Tweedsmuir

It is continually suggested that we on this side of the House have always been against any kind of State intervention, but the catalogue of instances of State intervention dating from the time when my right hon. Friend the Prime Minister wrote his book, "The Middle Way". is very extensive indeed, and it ranges, I should say, on balance, towards those industries under those conditions where the ordinary disciplines of the competitive system are either absent or are insufficient.

If we can define what is the difference between us on this policy we should be very much clearer about how we can carry on to improve the trend in Scotland which, without doubt, is encouraging, but which, also without doubt, does not satisfy any of us completely. The distinction between us, I think, is that the party opposite believes that where private industry cannot or will not show what hon. Members opposite call private enterprise, or imagination, the State should take over and should run State industry on social as well as on economic grounds. Our attitude is that where the ordinary competitive conditions and disciplines do not exist which will enable an industry to be viable and, therefore, able to pay the wage rates of those who live within it we should try to use the power of the State to help private industry to help itself—

Mr. Willis

That is precisely what it does: it helps itself.

Lady Tweedsmuir

—but we do it because we believe that by so doing we, who are responsible, after all, for the taxpayers' money, are bringing the Government into a liability of limited duration. If we undertake this action for an indefinite period we are trying to prop up some form of industry for which, for instance, there may not be a market, or may not be for very long.

It is often asked of us, "Under what principle do you really work?" I always think that the very best description of how we approach these problems can be summed up in a passage of John Stuart Mill which may be familiar to some hon. Gentlemen: The Government can most surely demonstrate the sincerity with which it intends the greatest good of its subjects by doing the things which are made incumbent upon it by the helplessness of the public but in such manner as will tend not to increase or to perpetuate their helplessness. The Government should use the pecuniary means and apply them when practicable in aid of private efforts rather than in supersession of them. I really think that is the best summing up of our attitude towards the various forms of Stale help or State intervention—subsidies, agricultural subsidies, whatever it may be—which I can think of today.

Hon. Gentlemen opposite have rather implied during this debate that all we really have to do is, for example, to use the taxpayers' money to establish industry in the place where private industry would not be viable and to run it, and that thereby we can create the social and economic conditions which we all desire. I was particularly surprised that the hon. Lady the Member for Lanarkshire. North, in a quite long and careful speech earlier today, not once mentioned the question of markets. It is absolutely no good whatever setting up an industry—and with the taxpayers' money—unless we are sure that there is to be the necessary demand.

We all, I think, appreciate—certainly we on this side of the House do—the very difficult and long negotiations which the President of the Board of Trade has had in trying to bring about some form of compromise with the Common Market. Now that those negotiations are still going on, let us turn for a moment from the old world to the new and consider the markets in the new and developing countries.

The Scottish Council (Development and Industry) recently sent one of its members to Australia, Sir Ronald Maclean, and he said this: Australia is wide open for almost any kind of heavy development equipment. I ventured to say, after visiting Australia myself, that I thought that it was by no means only heavy equipment which was wanted here, and that there was an enormous range of consumer goods of every kind which could obtain a market. We have recently had Lord Polwarth making an extensive tour of Canada and telling us that there are markets in British Columbia and Alberta. These reports from the Scottish Council have urged that leading men in any firm should go to visit these countries for themselves.

I certainly think that there are three things which any firm wishing to expand into the export trade in those big countries should undertake to do. First, they should not just send a catalogue. Secondly, they should send a man who can take decisions on the spot. Thirdly, and most important of all, they should not wait until the boom is over, as in the Midlands, because now is the time to try to capture markets. I believe that Scotland has a very great opportunity hare, because many of the manufacturing industries in the Midlands are at present fully occupied with the home market. We have a superb opportunity to examine these markets overseas while those south of the Border are busily occupied at home.

On the question of trying to expand Scottish industry, it should be remembered that it has been estimated that the Canadian housewife is subjected to about 700 advertisements a day, which she receives from the radio, television, hoardings, magazines and newspapers. Anyone seeking these markets, where no doubt there are great opportunities, must 'break into a difficult field, and that is why it is important that the person at the top who can make decisions should go there.

We should be very encouraged by the success of the British Exhibition in New York where, unfortunately, there was only a very small Scottish contribution. There are great opportunities in the Canadian National Exhibition at Toronto. There are chances there for a number of small firms to get together and establish a stand and make themselves known personally by sending top executives to what is a very widely publicised fair right across Canada.

While the trends in Scotland are certainly encouraging in facts and figures, I think, nevertheless, that one of the most encouraging signs is that Scotsmen themselves are really beginning to try to make their own way again as their compatriots do all over the world. In my constituency a North-East Development Council has been set up, comprised of representatives of the trade unions, employers, the Scottish Council and all interested bodies. The Council's object is not only to try to attract industries to the area, which happily at the moment has an unemployment figure below the Scottish average, but also to try to discover what opportunities there are for Scottish manufacturers to export overseas. That united effort by every section of the community is being reflected gradually throughout Scotland. In the end, that will be convincing proof that Scotland, with Government help, can pull herself up by her own bootlaces.

7.54 p.m.

Mr. J. Hill (Midlothian)

The right hon. Gentleman the President of the Board of Trade said that coal production had decreased by 3 per cent. last year, shale oil production had decreased by 4 per cent. and that the paper industry was buoyant. These happen to be the three basic industries in my constituency, and I should like to say something about the existing industries before dealing with the question of trying to attract new industries into Midlothian.

At the General Election the Government said that they would bring in measures to improve employment in Scotland. Let us examine what they have done to encourage existing industries in my constituency. We are always being told that the coal industry is running at a loss of millions of pounds. Obviously one would have thought that the Government would have tried to do something to help the National Coal Board out of its difficulties in Scotland. My hon. Friend the Member for Central Ayrshire (Mr. Manuel) mentioned yesterday that one measure that the Government had adopted was to take the Irish market away from the Scottish coal fields. The quarter of a million tons of coal each year that is now being sold from England was formerly produced in Scotland.

The right hon. Gentleman the Minister of Labour pointed out today that the redundancy in the coal industry had been absorbed. That is true, but the right hon. Gentleman neglected to say that hundreds of these men were absorbed in other jobs at a loss of anything from £1 to 30s. a day. The right hon. Gentleman added that the Coal Board would recruit 2,000 youths this year. What will that do? It will not create any more jobs in the coal industry. It will not even replace the wastage in the industry.

The Government encourage the National Gas Board to import methane gas from the ends of the earth to take the place of home-produced coal in the manufacture of household gas. They are also encouraging the import of cheap oil, and they have the audacity to say that the coal industry is not competitive when they are doing their best to strangle it. In the past, the Coal Board has had to borrow on the open market. I will do no more than mention the Bank Rate because the subject has been sufficiently "flogged" already. But the Board has had to borrow in the open market and pay the Bank Rate, and all this must come off the point of the pick. The Government therefore have done nothing to help the coal industry. On the contrary, they have taken the opposite view and have gone further in their attempts to strangle it.

It can be assumed that next year there will be further closures in Midlothian. Some of the pits which are now working have been reduced from double-shift to single-shift pits. If there are any more closures in the Lothians area unemployment will increase, because the Coal Board has admitted that there is no face room for men who become unemployed in the industry from now on.

The right hon. Gentleman the President of the Board of Trade was very pleased with himself when he said that the paper industry's books were full of orders. He did not say that those orders were secured before 1st July this year. I had a discussion with two of the leading paper manufacturers in Midlothian in June. They admitted that their mills were doing well, but they were worried about what would happen when the first part of the quota restrictions were removed on 1st July.

The President of the Board of Trade and his predecessor have not been able to convince these people that the European Free Trade Association is not going to be a detrimental factor for them. Indeed they go so far as to say that within ten years the paper industry in Scotland will die. In one small burgh in my constituency 80 per cent. of the population is dependent on the paper industry. The Board of Trade may have its views, but the industry itself takes an entirely different view in Midlothian.

In the Report it is said that the shale oil industry has declined by 4 per cent. The reason given is that it is not competitive. After the General Election and the beating that the Tory Party took in Scotland, I should have thought that hon. Members opposite would try to do something to help that industry, but apparently they have not yet learned their lesson. This Government insist that the miserable tax of £660,000 a year is to go on, and the shale industry is slowly dying. The Government are prepared to see it die. We have discussed this question at various times in this House and always we have had the same answer—the industry is not competitive. Surely the way to make it competitive is to remove the tax and give the industry a chance.

In part of my constituency, the Calders area has 4.8 per cent. unemployed. When it was scheduled under the Local Employment Act, I was delighted. When we had news that the British Motor Corporation was to build a factory at Bathgate, which is five miles from my constituency, I was so delighted that I hopped on the first plane to Scotland to try to organise the people in that area so that they should get a share of the B.M.C. orders. Obviously the first thing to do was to ask for a meeting with the Secretary of State for Scotland. We got a meeting with the Secretary of State and he was very charming, as he always is.

Mr. Willis

That is all we get.

Mr. Hill

We pointed out a very desirable site on the main Edinburgh-Glasgow railway line with water and electricity laid on and good road connections. It would be a good site for a components factory. It seems to me that the view seems to be taken that the B.M.C. factory will solve the unemployment problem in Scotland. When we explained this to the Secretary of State he was very nice and said that he agreed it was an ideal site; he had every sympathy with us, but the Government could not direct industry. I would remind the Secretary of State that sympathy will not pay the store book. Sympathy is not enough.

If ever there were a case for the Government to use their powers to establish an advance factory it is in connection with that site in Midlothian. From the newspapers I see that a number of firms in Scotland and some in England want to try to get ancillary trades established to supply the B.M.C. factory but, unfortunately for my area, there were no factories there to get work. At the same time, I think it only right that we should have had a promise from the Secretary of State for Scotland that we would get an advance factory.

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

Did I hear the hon. Member say that a promise had been given?

Mr. Hill

No, I said that we ought to have had that promise. This is an area with 4.8 per cent. unemployed and I think it is deserving of some Government help.

New towns have been mentioned in the debate. I would remind the House that a new town was started in Midlothian, but that has been forgotten. A new town was started at Newbattle because of the expected expansion of the coal industry. In that new town sites were zoned for industry. I happened to be the planning convenor at that time. We tried to get light industry for the youths and young girls who had to travel 20 or 30 miles to work in Edinburgh, but we were unsuccessful. The only factory which came to that new town was one from Edinburgh. It had no further room for expansion there, and had to move.

For years we have been trying to attract industry to Midlothian, but for years we have been unsuccessful. With the run-down of the coal industry, the shale oil industry and the paper industry, instead of an overall unemployment figure of 1.9 per cent. we shall have a much increased figure within a very short time. I am quite sure that my opponent at the General Election, who fought on the Government programme, would agree—as he did during the election—that unless the Tory Government do something far Scotland, the defeat they suffered in the last election was nothing to that which they will suffer at the next. I am quite convinced of that.

Last night the Joint Under-Secretary of State referred to various areas which had had assistance, or were due to have assistance. I sat here with my ears pricked waiting to hear him mention Midlothian, but Midlothian was never mentioned. I remind the Secretary of State that the premier county of Scotland still exists. We are looking for our share just the same as any other part of the country. If we do not get it, we shall come back and ask him why.

8.8 p.m.

Mr. Ian MacArthur (Perth and East Perthshire)

I rise with some diffidence to take part in this debate, especially as I am following the hon. Member for Midlothian (Mr. J. Hill). He, like most hon. Members who have spoken yesterday and today, represents a constituency in which unemployment is concentrated. I represent a constituency that is fortunate in that respect. Unemployment in Perth and East Perthshire is something like, not the average for Scotland, but for Britain. It is one of those fortunately placed districts which somehow has managed to achieve a variety of employment such as we look for in Scotland. We have a broadly based agriculture, and a wide variety of light industry.

Nevertheless, the problem of unemployment is national and we are all agreed that the root of the problem lies in the fact that for too long we have been dependent on too few industries. In the main, those are heavy industries, which are the first to suffer and among the last to recover during a time of world recession. In recent years, the process of recovery has been hampered by the fact that two of our heavy basic industries, shipbuilding and coal mining, have faced difficulties of their own, which have been mentioned during the debate, latterly by the hon. Member for Midlothian.

Hon. Members have referred to the great modernisation programme which at last has been followed in many of the large Clydeside yards. I visited a yard not long ago and was astonished to see how in five years the whole aspect of a shipyard had changed. Shipbuilding is no longer the old, familiar craft which one used to see, but is now an entirely new industry faced with new and intense competition. It is sad and disturbing to note that in Scotland over the last few years, facing this intense competition, nearly 900,000 working days have been lost through disputes in shipbuilding and ship-repairing. Many of those disputes sprang from difficulties following on the modernisation schemes—problems of demarcation with the new methods of construction. I hope that those will sort themselves out and that further harm will be avoided in an industry which is now in a critical state.

From what has been said, it is evident that we all agree that further diversification is needed in Scotland. There has been a great deal of diversification since the war, but it has not been enough to provide the jobs required to meet the natural increase in population, to stop the drift away from Scotland and to absorb the rising number of school leavers. It has been estimated that Scotland will need 120,000 new jobs over ten years to meet those needs. On top of that, we have somehow to balance the wastage from declining industries, so that that figure of 120,000 over ten years is probably only a minimum.

Both sides of the House agree that the bulk of the new jobs must be provided by industries spreading northwards from England. Equally clearly, we profoundly disagree about the way in which industry is to be attracted to Scotland. Hon. Members opposite have rediscovered nationalisation in some uncertain form and they say that some curious form of public ownership, which they have not defined, is necessary.

Mr. Thomas Steele (Dunbartonshire, West)

Will the hon. Member explain how we are to nationalise industries which are not even there?

Mr. MacArthur

I am very glad that the hon. Member has made that remark, because it helps to clear the air. There has been talk of advance factories, with which we do not necessarily disagree, but also much vague talk about public ownership. Talk of public ownership, especially if it is vague, is very likely to keep out of Scotland the private industry which we need to attract.

Mr. T. Fraser

On the contrary.

Mr. MacArthur

The hon. Member says "On the contrary", but I have not yet discovered any private industry which welcomes the prospect of nationalisation. Perhaps hon. Members opposite have. On our side, we believe that true security of employment can be provided only by industry standing on its own feet.

Mr. Manuel

Government subsidies.

Mr. MacArthur

Various forms of inducement and encouragement are necessary to assist the first development of new industries and the Government's measures to achieve that have already met with considerable success.

Mr. Manuel

With subsidies.

Mr. MacArthur

But English firms will move north of the Border only if Scotland is seen by them to be a desirable place in which to live and work.

Mr. Manuel

Is it not?

Mr. MacArthur

No industrialist wants to move to a country which appears to him to be in a state of steep decline and inhabited by dour people holding out the begging bowl. We know that that is not the state at all, but it is without question the image of Scotland which, unfortunately, exists in many people's minds. Alas, it exists in the minds of many hon. Members on both sides of the House who represent English constituencies and it is just the impression which has been given by many of the comments and interjections of hon. Members opposite, especially those made yesterday. They insist on shutting their eyes to the good and proclaiming the bad.

I was very disappointed that we did not hear more speeches of the stirring quality of that made by the hon. Member for West Stirlingshire (Mr. W. Baxter) who himself recognised—all the more credit to him—that we have turned the tables on unemployment.

Mr. Manuel

He never said so.

Mr. MacArthur

It is there in black and white in HANSARD and I commend him for recognising the truth.

For the sake of Scotland, we should give enthusiastic publicity to the remarkable figures given to us yesterday by my right hon. Friend the President of the Board of Trade. I want to turn to those figures again. My right hon. Friend said that work under construction should provide about 7,500 jobs; projects approved should provide another 16,300 new jobs. He went on to say that other projects which had not yet been approved might provide a further 15,000 jobs.

Much play was made with those figures by hon. Members opposite and the impression they gave, whether wittingly or not, was that those estimates were false or, at best, misleading and that, if they were true, their total was paltry. Of course the figures are estimates—we all recognise that—because the jobs do not yet actually exist.

Mr. T. Fraser

The figure of 22,000 jobs lost in the last few years in two industries alone, given by the right hon. Gentleman the Minister of Labour today, was not an estimate but a fact.

Mr. MacArthur

I recognise that and if the hon. Member had allowed me, I was coming to that very point.

The figures given yesterday by my right hon. Friend were estimates in that the jobs do not exist, but they are realistic estimates and are the only basis on which we can forecast what is to happen to industry over the coming years. My right hon. Friend presented those figures in very carefully chosen words, but perhaps with too much caution. The figure of 23,800 jobs which will come from projects under construction and projects approved is as definite as any honest and realistic forecast can be. The other 15,000 possible jobs are to be provided by projects in an advanced stage of negotiation.

However, that is far from being the sum total of new jobs coming to Scotland. The figures relate only to industrial buildings for which I.D.C.s are necessary. They take no account of the other new jobs which industrial expan- sion will provide automatically. It has been estimated that for every five new jobs produced in manufacturing industries, at least one new job is provided in distributive services and allied trades, so perhaps 7,000 or 8,000 other jobs will be created in that way. Moreover, those figures take no account of industrial developments in existing buildings for which no I.D.C.s are required.

As hon. Members know, many firms in Scotland have been working below capacity and the Industry and Employment in Scotland and Scottish Roads Report, 1959–60, shows the quickening pace of activity in many existing industries. This year this quickening activity has cut into the high unemployment figures that existed a few months ago. The number of unemployed has fallen by about 31,000, and can be expected to fall further.

The hon. Member for Edinburgh, Leith (Mr. Hoy) referred to the thousands of miners who had lost their jobs. I think I am right when I say that only 140 of them have not been re-employed. The remainder have been absorbed into other jobs.

Mr. T. Fraser

The proposition we are putting to the hon. Gentleman and to his right hon. Friends is that last year there were 6,700 fewer jobs in the mining industry, not that we had 6,700 unemployed miners.

Mr. MacArthur

If I misunderstood the hon. Gentleman, I apologise. I think it is recognised that, alas, through the closure of pits many thousands of miners lost their jobs.

During the debate reference has been made to wastage in industry being an additional load that we had to carry.

Mr. Hoy rose

Mr. MacArthur

The point I am making is that of the thousands of miners who lost their jobs only 140 are still unemployed. I make that point because of the many accusations levelled against the Government by hon. Gentlemen opposite.

Mr. J. Hill

Would the hon. Gentleman agree that one of the reasons why employment was found for these men was because in November last year the National Coal Board compulsorily retired all men over 65? By that means new jobs were found for men who otherwise would have been unemployed.

Mr. MacArthur

I recognise that many of the miners were employed in other pits.

The suggestion made by many hon. Gentlemen yesterday that the figures given were not realistic is unfair. Clearly more work will be provided as this industrial recovery progresses. From the long-term point of view we can look forward with confidence to the 39,000 new jobs referred to by my right hon. Friend. In a matter of months the Government have been able to announce the creation of new jobs which will account for more than one-quarter of the ten-year requirement, which is the estimate we all accept. If hon. Gentlemen opposite do not follow my argument I will repeat it.

Mr. Manuel

The hon. Gentleman is a "crazy, mixed-up kid."

Mr. MacArthur

The 39,000 new jobs which my right hon. Friend announced yesterday are jobs which will be created over a period of years. Over the last few months we have achieved 39,000, or just over one-quarter, of the 120,000 jobs required over the next ten years. [Laughter.] Hon. Gentlemen opposite may sneer at the progress being made, but the figures deserve the widest publicity and my right hon. Friends deserve the warmest congratulations from all Members of the House. I suggest that it would be more fitting if hon. Members opposite drew more welcoming attention to the announcements than they have done so far.

Mr. Hoy

As regards the 15,000 new jobs, may I remind the hon. Gentleman of what the President of the Board of Trade said yesterday? He said: I want to make it clear that the 15,000 jobs to which I have referred are not firm. They are possibilities which we hope will come about but I can give no guarantee at all about them."—[OFFICIAL REPORT, Tuesday, 12th July. 1960; Vol. 626, c. 1220–1.]

Mr. MacArthur

I am obliged to the hon. Gentleman for reading HANSARD. I have been reading it myself today. The 15,000 jobs to which my right hon. Friend referred are jobs which, if things go well during the negotiations which are far advanced, will be provided. They are not imaginary jobs somewhere up in the sky.

Mr. Manuel

They are way down, not up.

Mr. MacArthur

I recognise that it is not only from outside Scotland that new jobs should be provided. There is room for expansion in the native industries of Scotland. I wonder if some of our small firms are doing all that they can to provide new employment. There is a higher proportion of small firms in Scotland than one finds South of the Border. I sometimes wonder whether those small firms are aggressive enough, or whether they are a little slow to take advantage of the advisory services offered by the Government and bodies such as the National Union of Manufacturers. I sometimes wonder, too, whether they are not a little out of date in the salary and wage scales which they pay people who hold responsible positions.

I have had experience of this. It appears that a reason for the drift away from Scotland of skilled men and technicians is because, by going South, not only are they sure of finding jobs but jobs for which the rate of pay is higher than they would receive in Scotland.

Another sphere of Scottish life is the Highlands. I am not sure that I agree with the suggestion that industrial development is necessarily the right solution. In some places the population may be large enough to enable a light industry to be set up, but I do not see the future of the Highlands as one of humming factories. We should proceed to the development of agriculture and forestry, and to the creation of small industries—if one can call them industries; perhaps enterprises would be a better word—in the glens which would provide employment for two, three or four people. Such small pockets of employment would make a world of difference to the Highland counties.

I think that in a previous debate the hon. Member for Hamilton (Mr. T. Fraser) said that many of the souvenirs bought by tourists were manufactured outside Scotland. I was shocked to discover this for myself a few days ago. I was in Mallaig and I looked in a shop window displaying horn models of sailing ships and similar souvenirs. I said to myself, "At last a local firm has been set up to make souvenirs", but when I looked more closely I found that every souvenir carried the label, "Made in Holland." I think it a disgrace and I hope that as part of the great tourist development which is now starting in the Highlands little industries and local firms of that kind may develop.

I wish that we could publicise some of the positive advantages which Scotland has to offer. I am dismayed when I see advertisements in the papers about Northern Ireland and Malta, both places being held out as highly desirable places to develop in but hardly a word is said about Scotland. In Scotland we have highly skilled labour. We have men who have an extraordinary inherent skill in their fingers, whether it be for shipbuilding or for working in silver or the finishing of woollens. There is this extraordinary tradition of skill and we have a history of good industrial relations. In Scotland the transport facilities are far better than is often believed, and I suggest that the argument about transport difficulties is often seized on by people South of the Border as too ready an excuse for not going to Scotland.

There is another side of this matter—the attractions which Scotland may have for the wives of people who have to move their houses, and for their children. I go to the central Highlands every week to my home, and week after week experience this wonderful transition, a move from the crowded city, to the open country. The area is not remote. I am under an hour's ride from Dundee and Perth and not much farther from Glasgow. It is possible to find building sites if one wishes to build and there is much more scope for breathing and living in these parts of the country than in the overcrowded conurbations South of the Border. To use the words of the advertisements, if someone is looking for gracious living it can be found more easily and cheaply in Scotland than in our large cities.

We must not be too complacent about the position, and I hope that I have not given the impression that I am complacent. But we must also recognise the progress which has been made and realise that it is only the beginning of a new upsurge in Scotland's industrial activity. I do not want to lay myself open to the accusation that I am dancing away beyond the rainbow's rim, but if we can somehow live through these next two or three years, which I believe will be the most critical from the unemployment point of view, and if things progress as they are doing, we may enter a new industrial era in Scotland.

8.33 p.m.

Mr. William Hamilton (Fife, West)

At this time of the year I like to read the educational Press in which articles are produced on the howlers of schoolboys in examinations taken within the last month, and at times I think that there is a good deal of substance for those articles in speeches such as the one to which we have just listened.

The hon. Member for Perth and East Perthshire (Mr. MacArthur) began by saying that his constituency was not a problem area regarding unemployment, because there was a variety of industry including agriculture. One of the main points of our argument in this debate has been—and it will be in the future—that the pouring in of public money will help more than anything else in bringing employment to Scotland, and the only basis of the industry represented by the hon. Member is that it gets millions of public money every year with no sign of that supply ever stopping. But in practically his next breath he said that we did not want to give the impression that we Scotsmen were coming along with our begging bowls. The hon. Gentleman must wake up.

Mr. MacArthur

The hon. Member is well known for his continual assaults on agriculture, so I do not propose to follow up that point. I am sure he will agree that the point I was making was that in Scotland we need a variety of industries. In my constituency, agriculture is not the only industry; we have a wide selection.

Mr. Hamilton

The hon. Gentleman would be the first to admit that in that he is exceptional.

The hon. Gentleman went on, further, to talk about the curious form of public ownerhsip which we are advocating. I ask him to obtain advice from his right hon. Friend. He is the nationaliser in the very area about which the hon. Gentleman was speaking. The right hon. Gentleman is the nationaliser of the Highlands shipping. He is the one who admits that only public ownership can solve the problems in the remote areas. That is what we say, and we expect support from the right hon. Gentleman when he replies to the debate.

These debates are taking on a pattern. On one side, the Labour Party concentrates, rightly, on social questions—unemployment, lack of opportunities for our youth, of which very little has been said in the debate, and the failures, as we see them, of private enterprise. We call for more public enterprise, more public initiative and more public expenditure. We make no apology for those demands.

On the other side, the Conservative Party and the Government say, as they have been saying for eight or nine years, how well they are doing and how well they intend to do. Their attitude is, "There will be jam tomorrow if only you fellows would stop moaning". That is the argument. I have experienced it in my own constituency. A few weeks ago the editor of the local newspaper published an editorial in which he asked why industry was not coming to the area. He asked, "Is it because they used to have a Communist M.P. and now have a rash Labour M.P.?"

This is the argument that the Government are now producing. They say that we, the moaners, are creating the impression that we are down and out and are frightening industry away. I remind hon. Members that more industry came to Scotland under the Labour Government than has ever come since. American firms, from the arch capitalist society, were breaking their necks to come in under a Labour Government.

Both sides always produce very carefully selected facts and figures, designed to prove and strengthen one's own case or weaken and destroy the opposition case. The Tories do it. We do it. We are entitled to do it. It is our purpose here to probe the weaknesses of the Government's policy, to expose them, and to put on the Government the onus of defending or justifying what they are doing by results.

I find this fact most disturbing. On 23rd June, the right hon. Gentleman made a speech on unemployment in the Scottish Grand Committee. He carefully selected his figures. He had just been handed them, which is what he loves. The right hon. Gentleman loves to be handed a brief by someone else, which he can read out.

Mr. Willis

He cannot always read it.

Mr. Hamilton

As long as he reads something handed to him by someone else he is as happy as a lark.

Just before the debate the right hon. Gentleman had been handed the latest quarter's figures. He said that the unemployment figures were down. Only a nitwit Government could avoid them going down in June. Despite the Government, they will go down in June. The right hon. Gentleman produced figures showing that production was going up. Again, only a nitwit Government could stop it rising after they had depressed it. On the basis of one quarter's figures, the right hon. Gentleman said that everything in the garden was lovely.

Mr. Maclay

I did not.

Mr. Hamilton

That is what the right hon. Gentleman implied.

Mr. Maclay

The right hon. Gentleman is having quite a lot of legitimate fun at the expense of my speech. He should read it again if he thinks that I said what he just said.

Mr. Hamilton

The inference from the right hon. Gentleman's speech was, "We are now on the crest of a wave".

Mr. Maclay

indicated dissent.

Mr. Hamilton

The right hon. Gentleman said that the worst was over and that we only had to trust in the Government's present policies, which were now producing results. Those were almost his exact words. The right hon. Gentleman said that the Government's policies were now producing results. He based that entirely on one quarter's figures.

I want to carry them back a bit further to get the picture of the trend—not the short-term trend as disclosed by one quarter's figures, but the trend over the years. That is what we are concerned with. When my right hon. Friend the Leader of the Opposition opened the debate yesterday he made this point brilliantly when he said that we might be making progress in Scotland, but that it was very much slower than the progress of the United Kingdom as a whole, and that the progress of the United Kingdom was infinitely slower than that of almost any other industrial country in the world.

This is our situation. When there is a boom in Britain as a whole, it is less in Scotland; when there is a crisis in Britain it is deeper in Scotland than in the rest of the country. We get the worst of all possible worlds but, when we point out these facts, the right hon. Gentleman and his hon. Friends say that we ought not to moan.

I was not in the House during the Parliament of 1945–50, but I followed the debates in those years very closely, and I recall the "Weary Willie" and "Tired Tim" speeches from the then Opposition when we were calling for increased production—and getting it. We had an average in production of 6 per cent. every year from 1945 to 1951. "Weary Willies" and "Tired Tims", indeed, when, even to this day, the Tories exploit the difficulties of the fuel situation caused by the weather conditions of the 1947 winter. That being so, they ought not to talk about us moaning.

Let me say what we complain of. We complain about the unemployment problem. We complain about the problem of lack of opportunities for our youth and for our womenfolk. We complain about the sluggish progress of our production figures. And one of our most important complaints is that when restrictive measures are imposed by the Government, our Scottish economy is much worse hit than is that of the rest of the United Kingdom. When those restrictions are removed, we get a Scottish improvement that is slower—and less—than it is in the rest of the United Kingdom.

I have referred to the unemployment figures. It is an interesting fact—and an inevitable one, I suppose—that this debate takes place at a time of year when these figures, as I have said, are inevitably improving, and Ministers take a perennial delight in saying that those figures are improving—in the summer months. There are more ice cream men—more beach attendants. Those are the fellows who give the improvement in the figures, but we cannot, on the basis of those figures, say that we are out of the wood—as, I think, the hon. Member for Perth and East Perthshire suggested. He seems, mysteriously, to have disappeared. He said that we are now round the corner, and that everything in the garden will be lovely—some time. He conjured up figures like rabbits out of a hat; 39,000 jobs—tomorrow.

If, as hon. Members opposite are so fond of suggesting, the Labour Government left such a mess in 1951, let us allow the Government three years to clear that up. Let us start in 1954. In 1954, the average monthly unemployment figure in Scotland was 59,500. In 1959, that figure had gone up to 94,900, and in the first five months of 1960 it was 90,700. Let it be remembered, too, that 1959 and 1960 were boom years. That means that in boom years, and in an election year, the average monthly unemployment figure in Scotland was more than 50 per cent. higher than it was in 1954. How, in the face of those figures, the Government can claim success for their policies, I just do not know.

In addition, in the years 1954–59 overall production in Scotland increased by only 2 per cent., and we should take into account, also, that there was a decline between 1956 and 1959 from an index figure of 128 to 126. This was at a time when conditions were the most favourable for expansion. Is it any wonder that, in face of those facts, we are desperately anxious at this time, when restrictive measures are imposed by the Government, when all the signs are that the United Kingdom as a whole is losing the world race in exports and production, when the signs are that things will not get easier for us in Europe and the Government's extraordinary luck in terms of trade will begin to run out?

If we have had all those contributory factors favourable to boom conditions, and we get a 50 per cent. increase in Scottish unemployment and only a 2 per cent. increase in overall production, what will happen when these lucky factors disappear? This is the question that is worrying us. We remember the Home Secretary's forecast in 1954 that we would double our standard of living in twenty-five years. On the basis of Scottish production figures between the time that the right hon. Gentleman uttered those words and the present, it will take us 250 years.

The Secretary of State for Scotland said on 23rd June that progress in the last few months has been good. Of course it has, though not as good as it has been in the United Kingdom generally. But what happens? The Government say, in effect, "You are doing too well. We are going to put a stop to it. We are to have a 6 per cent. Bank Rate." The President of the Board of Trade came into the House yesterday and said, "This will help Scotland". Why does he not give us a bit more help and put up the Bank Rate to 7 per cent. if that is the argument?

Mr. Ross

They did that once.

Mr. Hamilton

Yes. I suppose the President of the Board of Trade would say, "You will do a lot better in Scotland now that the Bank Rate is up to 7 per cent."

We all know that the Government have now embarked on a policy of curbing in particular public expenditure on housing, nationalised industry and local authority expenditure of all kinds, and there is to be less and less public investment, which means inevitably less and less employment in Scotland. The fact is that nobody in Scotland, and certainly nobody on this side of the House, believes what the President of the Board of Trade said yesterday. I do not think that he believes it himself. It is contradicted by all our past experience.

I want to make one or two references to my own area, the central part of West Fife. We have heard a lot of talk about the benefits of the Local Employment Act. The hon. Lady the Member for Aberdeen, South (Lady Tweedsmuir), who has a habit of speaking in these debates and then disappearing, and only attending on the day that she wants to speak, spoke about us on this side of the House wanting to direct industry. She could not understand how, in advocating public ownership and public enterprise, we would avoid the direction of labour.

We have had a lot of public ownership in the last few years and, so far as I know, there has never been any direction of labour connected with it. I do not suppose that the right hon. Gentleman, in instituting public owner- ship, in the Highlands, will be directing labour to the Highland shipping lines. When the noble Lady and the Government talk about the bogy of the direction of labour, they ought to remember that thousands of Scots are being directed at this time. I see them leaving West Fife, directed to the Midlands by hungry bellies. That is the direction they are getting now.

Not many months ago, I asked a Question about the number of youths unemployed in Cowdenbeath Employment Exchange area and the number of vacancies available to them. The Answer was that there were 122 unemployed and not a single vacancy, this, of course, being the worst area in Scotland and Scotland being the worst area of Britain. It is true that the figures have improved since then. The latest figure I had a week ago was 27 boys unemployed in that exchange area, with two unfilled vacancies. Thirteen lads chasing each of those jobs. This is a great improvement. We must be thankful for that.

My hon. Friend the Member for Dunfermline Burghs (Dr. A. Thompson)—I wish that he could have got into the debate—and I have led deputations to the President of the Board of Trade. I think that the right hon. Gentleman got sick of us at the end. I can imagine him saying to his officials, "We will put them on the list and put a stop to this". So we got on the list. What has been the effect? Absolutely nothing at all. The youth of the area are without hope and they are getting out.

On 6th July, I asked the Minister of Labour about the number of school leavers in Scotland, and I was told that the numbers seeking employment at the ages of 15, 16 and 17 were estimated as follows: 1960, 61,000; 1962, 81,000; 1964, 71,000. Thousands of boys and girls are leaving school, but there is no hope for the vast majority of them in Scotland.

This is the most serious aspect of the unemployment problem that we face. Central West Fife is one of the blackest areas of Scotland. What do the Government intend to do about it? It is no good saying that their present policies are succeeding. The simple fact is that, just by results, they are not succeeding. The onus is on them to produce alternatives, to provide incentives to industry to come in and, if the existing incentives are inadequate, as, plainly, they are, then it is up to the Government to seek others or to add to those that we already have.

8.55 p.m.

Mr. John Henderson (Glasgow, Cathcart)

I understood that an arrangement had been made through the usual channels for the last back bencher on this side of the House to be allowed at least ten minutes and to resume his seat at five minutes to nine. It is now five minutes to nine. I regret that, on account of the length of some of the speeches made today, I have only a couple of minutes in which to make my speech. The material on which I spent the midnight oil will have to be discarded.

The hon. Member for Fife, West (Mr. W. Hamilton) said that it was the duty of the Opposition to probe and to expose the Government's weaknesses. I have sat through the two-day debate and now, at the end of it, I believe that the Opposition have utterly failed to expose any Government weaknesses. Over the years the Government have had a very difficult job. They have made a very wonderful contribution to the general prosperity of Scotland, and, while the Opposition may not approve of what they have done, the Government can rest content that the people of Scotland are proud of their achievements.

I am extremely sorry—[Interruption.]—I do not know how many times the hon. Member for Edinburgh, East (Mr. Willis) has been interrupted in his speeches, but during the past two days he has interrupted speakers on this side of the House eight times. He may know a good deal about politics, but he is void of good manners in debate. It is time that some hon. Members opposite were told very plainly that the sooner they cultivate manners in debate the better it will be for their party and for this Parliament.

8.58 p.m.

Mr. Thomas Fraser (Hamilton)

We are now near the end of our two-day debate. We have had debates of this kind over a number of years, and Ministers have complained about the Opposition painting a picture of unrelieved gloom. Back-bench Members on the other side of the House have been faithful to their right hon. Friends, as ever, and, if they have not heard those complaints made by their right hon. Friends in past years, clearly they must have done their homework and read the speeches made by their Ministers. One after the other hon. Members have complained about the picture of unrelieved gloom painted by the Opposition. Over the years Ministers have always seen prosperity just around the corner. In the debates of 1952, 1953, 1954—in fact, every year—allegedly prosperity has been just around the corner, but the Opposition have refused to see it. Today and yesterday, but, I thought, in particular today, hon. Members opposite, once again, have seen prosperity just around the corner.

Yet the position in Scotland has got steadily worse when compared with the rest of the country, and, as so many of my hon. Friends have said, with other countries in the world. For years we have been twitted about making the comparative test and about comparing our well-being in Scotland with that in other parts of the United Kingdom. We have been much criticised for doing this in the past. I am delighted with our success in getting this test widely accepted as a proper one to make. In recent years the Scottish Council (Development and Industry) has been doing it, and that has made it respectable. The Scottish T.U.C. and Scottish newspapers generally have been doing it. Now even the White Paper makes the comparative test.

It is important to consider our economic health against the background of all the facts. In the Scottish Grand Committee on 23rd June, the right hon. Gentleman the Secretary of State for Scotland, after telling us about the unemployment figures which became available when the Committee was sitting, said: To get our discussion into proper context, it is necessary to know the most up-to-date position."—[OFFICIAL REPORT, Scottish Grand Committee, 23rd June, 1960; c. 46] That was quite right. There were two factors in the up-to-date position which had become known in the course of that morning's sitting. One of them was the new unemployment figures and the other was the increase in the Bank Rate. The right hon. Gentleman mentioned the first. He did not mention the second. He got annoyed with my hon. Friend the Member for Edinburgh, Leith (Mr. Hoy) last night for complaining about this. In these debates, the right hon. Gentleman has made many complaints about the Opposition selecting its facts. [Interruption.] Does not the right hon. Gentleman select his facts, and select them carefully and somewhat unfairly? When the right hon. Gentleman told us about the new unemployment figures, when we were discussing unemployment in Scotland, did he know that even before the new unemployment figures came out that morning, the Bank Rate had gone up? I should not like to think that he was unaware of it. I should not like to think that Scotland's Minister in the Cabinet was unaware of a decision of this kind having been taken by his colleagues. So I should think that he would have known and I should be very surprised if the right hon. Gentleman regarded this as an irrelevant factor in considering employment in Scotland.

We started our debate this year with an excellent speech from my right hon. Friend the Leader of the Opposition. He was able to make an examination of the economic health of Scotland from the outside. Some of us may have been accused at times of not being able to see the wood for the trees, but my right hon. Friend was not so handicapped. He could stand outside and look at the facts as they existed. He made a dispassionate analysis of the facts and he presented them in his speech.

Two days of debate have gone since my right hon. Friend made his speech. No right hon. or hon. Member opposite has disputed any of his facts, quarrelled with his analysis or offered any solution of our difficulties. What hon. Members opposite have done is to dispute the desirability of accepting the advice which my right hon. Friend had to offer the House.

The House has had a lot of statistics in these two days and in previous debates I have used a lot myself, but in the circumstances I had better exercise restraint in this regard this evening. I should, however, remind hon. and right hon. Members opposite, but particularly hon. Members opposite, of a conference convened by the Scottish T.U.C. in Glasgow a little while ago, a conference attended by Members of Parliament representing Scottish constituencies and representing all parties.

That conference unanimously accepted a resolution expressing grave concern with the economic health of Scotland. It then resolved to send a joint deputation to the Prime Minister. It was such a serious matter that the conference thought that it should not waste time on the Secretary of State, the President of the Board of Trade and the Minister of Labour but should go to the Prime Minister. The Tories agreed and they went in the deputation to plead with the Prime Minister to take steps which had not hitherto been taken to deal with the plight of the Scottish nation. During these two days of debate, however, there has been a change. Once again, everything in the garden is lovely. The hon. Member for Glasgow, Cathcart (Mr. J. Henderson) thinks that his Government have done a wonderful job for Scotland in the last eight or nine years.

We are sometimes blamed in till; House by our colleagues from constituencies South of the Border for being too nationalistic in our approach to this matter. We are blamed sometimes for even remembering that Scotland is a nation. Hon. Members opposite would, I think, proudly proclaim that we are a nation united with England and Wales and Northern Ireland and together forming the United Kingdom. They would proclaim that we are a nation.

As my right hon. Friend the Leader of the Opposition said in his opening speech yesterday, the increase in industrial production in Scotland since 1953 was 9 per cent. as against 20 per cent. in the country as a whole. That brought out, quite understandably, that there was virtually no increase in employment in that period. One would expect that increased efficiency in production would have taken care of at least an increased production of 1½ per cent. per annum. Had we not been part of the United Kingdom, how would we have compared with other industrial countries, even small countries? Norway has a population of 3½ million. We have a population of 5,200,000. Norway's increase in industrial production since 1953 has been 30 per cent. Denmark, with a population of 4½ million, has increased her production over the same period by 35 per cent. Austria, with a little bigger population of 7 million, has increased her production by 56 per cent. These, incidentally, are all member countries of E.F.T.A.

I wonder whether had Scotland been an independent country those countries would have welcomed us into E.F.T.A. at all. I hope that we should still have been in, but I believe that in these days of co-operation in matters of trade between countries we would have gone in clearly as a very poor relation of all the other members of E.F.T.A. Does not this make hon. Members representing Scottish constituencies just a little ashamed of our record for this period.

I am not a Scottish Nationalist. I favour integration with England and Wales. I believe that all the nations in Europe are aware of the high price that they have paid in the past hundred years for the economic fragmentation of Europe. I believe that is why competition, so highly prized by hon. Members opposite, is being replaced now by co-operation. But all the nations wish to benefit, and so they should, from the new mergers now taking shape. I should have thought therefore that, instead of constantly returning to the barren argument of whether the Labour Government of 1945 or the Tory Government since have done most for Scotland, we would have faced up to the problem of today and tomorrow.

I am not afraid to face up to that argument, but I think that it does not help the solution of our problem and does not give any satisfaction to the people in Scotland who are heeding what Members of Parliament are saying. I believe that our record bears favourable comparison with that of any country in Europe between 1945 and 1951, which is the only fair comparison. I believe that we have been falling behind ever since, as the statistics published regularly in the United Nations bulletin clearly show.

Having taken stock and made the analysis, what of the future? Should we seek to secure that Scotland will expand economically along with her neighbours in the United Kingdom and in Europe, or should we be content to provide a reservoir of labour for the expanding industrial developments in the Midlands and the South? That is the 64,000 dollar question to which the Secretary of State must give an answer tonight.

I am horrified by what has been going on in the United Kingdom as a whole. Taking the tables published on page 6 of the Ministry of Labour's Annual Report, I see that in the twelve months from May, 1958, to May, 1959, the increase in civil employment in the Midland region and the three regions to the south was 82,000. Yet in the regions north of the Midlands there was a decrease of 32,000 in the number of those in jobs. In the same period unemployment increased by 51,200. Consequently, even when the United Kingdom is in a decline in the matter of providing more employment, we still find that there is an increase in the Midland Region and the regions to the south.

Surely this drift is bad for Britain as a whole. It is socially undesirable. It creates very serious social and economic problems for the Government. As has been pointed out, this has an effect on housing, planning and traffic and road problems. I can understand why Scotland's share of the expenditure on trunk roads becomes smaller and smaller. The migrating Scotsmen are coming into the over-populated part of the country and creating difficulties in regard to the transport of goods which makes it necessary for more public money—not private money—to be spent on improving the arteries in the South.

There has been a lot of criticism of individuals in Scotland, and a lot of advice has been given to them about how they might help. It is no good blaming the industrialists in Scotland and the North of England. In doing so we are blaming our second best. After all, the best join the big enterprising firms in the South. There are one or two notable exceptions, but, generally speaking, this is precisely what happens. The big enterprises in the South are not English companies but British companies. That should sometimes be remembered. It is no use blaming Scottish capital. There is no Scottish capital. There is no English capital. Capital knows no patriotism; only labour knows patriotism. Capital will not pay heed to the social requirements of any part of the country in deciding where it should go. Capital will always chase the profits.

Mr. Ross

Anti-British, but it makes good sense.

Mr. Fraser

Yes—anti-British, but it makes good sense. Since we know what I have just said to be a fact, it seems to me idle to go on appealing to individuals, whether we call them industrialists, financiers or the holders of capital, to come to our aid. The economic well-being of countries has become the concern of Governments all over the world. The economic well-being of Scotland is the responsibility of the occupants of the Government Front Bench. They are the people who are answerable for the stagnation that we have suffered in our Scottish economy over a number of years.

The Opposition think that the time has come to deal with some of our problems by promoting public enterprise. There is no point in going on appealing to so-called private enterprise. Public enterprise will take many forms; there can be large units and there can be small units. However, if hon. and right hon. Gentlemen opposite, because of their doctrinaire objections to this, are unable to accept our advice, let them tell us what their alternative is. What are they going to do about it?

Let me turn to the speech of the right hon. Gentleman the President of the Board of Trade. Although he was not altogether seeking to reduce production, he said yesterday: What we are doing is to try to prevent home demand outstripping production, with bad effects for everyone. He went on a little later: We have been told for some years that the problem in Scotland is one of too much heavy industry and too little light industry. Now that we are taking measures, the effect of which will be to hold back light industry, the obvious corollary is that they will be more helpful to Scotland. That is a pure mathematical factor,"—[OFFICIAL REPORT. 12th July, 1960: Vol. 626, c. 1216–7.]

Mr. Willis

What rubbish.

Mr. Fraser

The logic of that passage somewhat escaped me.

Mr. Willis

Escaped the right hon. Gentleman, too.

Mr. Fraser

What the right hon. Gentleman said was contrary to all our past experience. The 1957 restraints admittedly affected heavy industries most. Scotland suffered most. In any case, I thought the President of the Board of Trade knew—he said it yesterday—that Scotland's need is for light industry. Are we more likely to get it during a period of restraint on the expansion of light industry? I thought that the remarks of the right hon. Gentleman the Minister of Power when Parliamentary Secretary to the Ministry of Labour, in last year's debate, and quoted by my right hon. Friend yesterday, made much more sense. Not that I think that he is a more intelligent man than the President of the Board of Trade. I think that the President of the Board of Trade is one of the most intelligent occupants of the Government Front Bench. That is why I was so surprised that he made such silly remarks yesterday. I appeal to him to deal with the problems of Scotland with a little less levity, flippancy, than he dealt with them yesterday.

He told us about the I.D.C.s which have been issued in Scotland in recent times. He said that there were 23,800 jobs in the pipeline and that another 15,000 were possible. He said he thought that we should be pleased. Of course, we are delighted. What disappoints the right hon. Gentleman is that we are not blinded by the promise of these additional jobs.

Let me tell him what the Glasgow Herald, a newspaper which is not altogether for our side of the House, said in a leader today. I quote the last sentence of the leader: Since supplies of light steel sheet will begin to roll from the Ravenscraig nd Gartcosh mills within two years a much more vigorous effort to stimulate local initiative is obviously desirable. Hon. Members on the other side of the House do not agree. They have such touching faith in their right hon. Friends.

I remind the right hon. Gentleman that in recent times he has been receiving some representations from my hon. Friends the Members for Motherwell (Mr. Lawson) and Bothwell (Mr. Timmons) about the Naval stores at Car-fin. Questions have been asked in the house about them. There we have 500,000 sq. ft. of first-class industrial building one mile from Ravenscraig. The suggestion is that it should be turned over to be used as whisky stores.

Mr. Bence

Who wants to store whisky?

Mr. Fraser

If there is all this anticipation of a great upsurge of employment in Scotland, surely it is not beyond the wit of the President of the Board of Trade to get some of this new industry into this first-class industrial building? The right hon. Gentleman keeps on saying, "storage." It was built for storage purposes, certainly; but does he deny that the buildings of the Naval stores are first-class factory accommodation?

The President of the Board of Trade (Mr. Reginald Maudling)

About 20 firms have not thought so.

Mr. Fraser

The right hon. Gentleman says that about 20 firms have not thought so. Are those 20 firms to build accommodation elsewhere?

Mr. Willis

In Scotland?

Mr. W. Hamilton


Mr. Fraser

Down here? I should like very much to have some information from the President of the Board of Trade, if not now then some other time, about the people who have inquired into the use of this property. As far as I am aware, all the industrialists in Lanarkshire, who know a little about industrial buildings, regard these buildings as absolutely first-class industrial buildings, and here they are cheek by jowl with Ravenscraig. What the right hon. Gentleman did not tell us is what other accommodation is being converted or built nearby in Lanarkshire to make use of the light sheet steel that will come from Ravenscraig in the next few years.

We have all this talk about the 39,000 jobs and all the I.D.C.s that have been issued, but I wonder whether the President of the Board of Trade will whisper something to the Secretary of State for Scotland so that that right hon. Gentleman might tell us how all this compares with the I.D.C.s issued in the Midlands and the South. Does he still claim that to build I million sq. ft. of new factory space at Basildon in Essex will not provide a single extra job? The right hon. Gentleman must know how many of these I.D.C.s issued in Scotland are for buildings to replace existing capacity. I wish he would tell us how many of these jobs are not new jobs at all but are jobs that will be found in factories different from those where they exist at present, the existing factories being closed.

We have heard for years about I.D.C.s issued in Scotland, which included Ravenscraig, and about the number of jobs that would be found in the Ravenscraig works. Then this £23 million development was completed. After it was completed, what happened to all the thousands of jobs that were going to be created? I will tell the Secretary of State. There were 4,000 fewer jobs in the steel industry in Lanarkshire because of the building of these modern steel mills, but his right hon. Friends at the time took credit for the new jobs that would be provided in Ravenscraig.

Some of the new factories will have the overspill industries of Glasgow. These are not new jobs. They are jobs in replacement of those which exist at present. Will the Secretary of State in his reply to the debate give a net figure of the new places which are likely to be provided by these I.D.C.s that have so much pleased his hon. Friends? Will he tell us how many more jobs there will be in Scotland at the end of 1960 than there were at the end of 1957? How many more jobs will there be at the end of 1960 or 1962? Is there any target? Is any account being taken of the rundown in other industries?

The hon. Member for Perth and East Perthshire (Mr. MacArthur) was terribly impressed by the 39,000 jobs as having gone so far towards providing the 120,000 jobs needed in Scotland in the next ten years. I regret that the hon. Member did not know a great deal of what he was talking about. We shall be increasing our working population in Scotland by more than 120,000 in that period. Therefore, if we provide only 120,000 new jobs in the next ten years we shall be much worse off than we are now. We want not 120,000 new jobs but additional jobs to enable us to stay even where we are now, and we are now at the bottom of the European league. We ought to take account, therefore, of the rundown in existing industries.

I was grateful to the right hon. Gentleman the Minister of Labour today for putting some of these figures in perspective by telling us of the rundown in manpower in some of our older industries. There has been the loss of 22,000 in mining and shipbuilding in the last few years.

The hon. Member and many hon. Members opposite did not seem to realise that we had any complaint at all about the rundown in existing industries, provided people who were declared redundant found jobs elsewhere. The point is that we are concerned about the number of jobs available in Scotland as a whole. It is a question of job opportunity. Of course, we should like to see the number of unemployed constantly reduced, but our greatest concern is to find employment opportunity in Scotland for Scotland's workers. Therefore, I ask the Secretary of State to tell us how soon he expects that sufficient jobs will be provided in Scotland for the Scottish working people, or is this the aim?

I turn for a moment to the statement by the Chancellor on the control of credit and I wish to ask for some information from the right hon. Gentleman. In his statement on the control of credit, on 28th April, as reported in columns 395–401 of the OFFICIAL REPORT for that day, the Chancellor told us about special deposits in the London clearing banks and the Scottish banks. In the case of the London banks the initial special deposit was to be 1 per cent. and in the case of the Scottish banks it was to be½ per cent. It has since been doubled to 2 per cent. in the English banks and 1 per cent. in the Scottish banks. Why is there that difference? I think the Chancellor was wise not to make it clear, but he gave the impression that it was because there was less need for restraint on bank advances in Scotland to assist expansion in Scotland.

Many very intelligent people in Scotland have been writing in the financial columns of newspapers and have assumed that this was the reason why in Scotland there is a lower rate. Will the Secretary of State come clean with us and tell us whether it was not because of a difference in the liquidity ratios on which the banks work, to which incidentally, our attention was drawn in the Report of the Radcliffe Committee?

I say this to the right hon. Gentleman. There is no danger of demand for goods outstripping capacity to produce goods in Scotland. There is no need for this restraint to which I have just referred, or any other restraint in Scotland. There is no need to put a restraint on bank advances for expansion and no reason I can see why English or Scottish banks making money available for the purpose of promoting economic expan- sion in Scotland should have any impediment put in their way in making that money available.

Mr. Hugh Fraser is reported to have borrowed £10 million from a Scottish bank to take over an existing business in London. There was no new capacity involved. It meant that £10 million of money from a Scottish bank passed to the shareholders of the former owners of Harrods in London for reinvestment down here. I could well understand the case for restraining the banks in a case like that, but I cannot understand it in the case of banks helping industrial expansion in Scotland.

I must give way almost at once to the Secretary of State. I ask him to bear in mind that Britain's working population increases by more than 100,000 every year, and Scotland's working population increases by more than 10,000 every year. That is why the Scottish Council says that we would require 12,000 new jobs every year. I think that is wrong, for I think that estimate took no account of the arrears we have accumulated. I think that the Scottish Council grossly underestimated the loss of employment in the older industries. The Council completely ignored the increase in the number of school leavers and, when it made this estimate, it was unaware of the impending termination of National Service. I estimate that for several years we shall need at least 20,000 new jobs in Scotland each year to give us anything like full employment. I wonder whether the Ministers have made any estimate.

I have not had time to talk about young people, as I had intended. The Joint Under-Secretary spoke about youngsters of 15 staying at school until they were 16 or 17. The number of young people leaving school at 15, 16, or 17 will be 61,000 this year rising to 82,000 in two years. Whether they are 15, 16, 17 or 18, they will still want jobs. Is he taking some consolation from the fact that if they are 17 or 18 when they leave school they will more easily find their way to the Midlands or to the South in search of jobs? Is the Secretary of State satisfied that in the next few years there will be jobs in Scotland for those young people?

If the right hon. Gentleman cannot face up to the challenge thrown out by my right hon. Friend the Leader of the Opposition yesterday and by my right hon. and hon. Friends during the course of the debate, and if he cannot answer some of the questions which I have put, we shall not regret his transfer to another place in pursuit of his predecessor. We have endured nine wasted years. We realise that the Secretary of State is not alone to blame. His Government stand condemned on the record. The time to make a fresh start is now.

9.32 p.m.

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

The hon. Member for Hamilton (Mr. T. Fraser) sat down with a strength of emotion in his voice which had been there throughout his speech. I sometimes think of the hon. Gentleman's speeches that halfway through I am greatly affected by his delivery and their content and by the human element which he brings into them, but at the end I have to ask myself whether he has said anything constructive. [HON. MEMBERS: "Oh."] That is a perfectly fair comment. I am prepared to accept the argument—[Interruption.] Will hon. Members please not interrupt at the very beginning of my speech without rising? I will give them plenty of opportunity to interrupt before I have finished. The hon. Member for Hamilton is entitled to say that his job is to criticise and not necessarily to be constructive, but in a debate lasting two days we have had much criticism and although I have read all of yesterday's speeches in HANSARD and listened to most of the debate over the two days, I can recall only a few crumbs of constructive thought which have come from all the speeches of the hon. Members opposite.

That fact has to be faced. A certain amount of fun is understandable when hon. Members speak of the results of the last election in Scotland. I have the figures with me and I will not use them until later in the debate, in case we get too much of an argument on an inessential, but I will say that the Labour Party in Scotland is still in a minority. What is more, hon. Gentlemen opposite have had nine years in Opposition and if we have done all the terrible things which the hon. Member for Hamilton (Mr. T. Fraser) implied, and if we have been such a lamentable failure, it is remarkable that there has been so little confidence in the alternative policies of the Labour Party that the total votes of the Labour Party and their allies fell by about 76,000 votes between the 1951 and 1959 elections.

Yesterday, I was accused of having asked hon. Members not to be political in their speeches. I have now been somewhat political, but there have been several political comments.

I now come to one or two points which I want to clear out of the way at the beginning of my speech.

Mrs. Judith Hart (Lanark)

Will the right hon. Gentleman give way?

Mr. Maclay

No, not at the beginning of my speech.

I should like to add my tribute to those already paid to the well-balanced and able maiden speech made by my noble Friend the Member for Edinburgh, North (Earl of Dalkeith). As Secretary of State for Scotland may I say that it is always a great pleasure to hear such a competent and able speech from a new back bench Member of the House of Commons. It leaves one slightly nervous of the trouble that the Secretary of State for Scotland may get from him later, but that is what it should be, and I know that my noble Friend will make many useful and constructive contributions in the years to come.

There are two points I should like to clear up. The first is a small point, but there was some argument with my right hon. Friend the Minister of Labour about it. It concerns Easter leaving. Education authorities in Scotland are required to have at least three leaving dates in the year. Some, including Glasgow, have four. All the authorities have a leaving date in April, though it is not necessarily precisely at Easter. This is the full story and it shows that my right hon. Friend was correct when he said that 12,200 left school in April, and that 180 of them were unemployed in mid-June. Hon. Gentlemen opposite interrupted as though they were dead certain that they were right. I wish they would not always be so sure they are right, because they are not.

The second point that was raised early in the debate, and, I think, was touched on by the hon. Member for Hamilton, was a request for comparative figures between Scotland and Great Britain of I.D.C.s granted. The figures I have available since the questions were asked are only for projects completed in 1959. Scotland's percentage by area was 11.4 per cent. The percentage by jobs was 16.1 per cent. The figures are not as good as we would like, but they are reasonably good.

May I now deal with the speech of the right hon. Gentleman the Leader of the Opposition?

Mr. George Lawson (Motherwell)

The Minister of Labour told us of the increase in the number of insured workers in Scotland, and undertook to give the number of insured workers in Great Britain over the same period. Are those figures available?

Mr. Maclay

The figures are quite difficult to get out, but I think that these are the figures for which the hon. Gentleman asked. Employment in Scotland in mid-1957 was 2,115,000. In mid-1960 it was 2,100,000. The figure for the insured population was 2,165,000 in mid-1957 and 2,171,000 in mid-1960.

The Leader of the Opposition made an extremely interesting speech, and I think that all lion. Members appreciated the very careful way in which an analysis was made of the situation. Throughout his speech the right hon. Gentleman made full use of statistics, as did the hon. Lady the Member for Lanarkshire, North (Miss Herbison). We all do from time to time, but during our two-day debate no statistics have been necessary to prove what we all know, that in Scotland we are still suffering from an unbalance of industry. That is what the figures we have heard so much about do. Some of the figures are heart-rending, some of them optimistic—from our side—factual figures showing what has happened. There has been no optimism from the other side of the House. I wish there were more signs of optimism from hon. Gentlemen opposite.

We all agree that the structure of Scottish industry is still out of balance. We have been over this ground often and I do not need to dwell on it. The only questions before the House are these. Are the efforts to correct this disparity properly directed? Are we on the right lines, and are we achieving success? If anything has come out of this debate it mast be the answer to these questions plus any constructive ideas and suggestions about how we can achieve better and faster results. I say emphatically that our efforts are properly directed towards diversification and I will say more about that later to show that diversification is happening.

We are achieving a considerable measure of success, but I will add, straight away, that we have still a long way to go. I do not think that anyone can disagree with either of those statements. The right hon. Gentleman made considerable use of the Report which is the subject of the debate. In passing, may I say that I hope the House feels that this year the Report is an improvement on those of former years. We at the Scottish Office will be only too glad to welcome suggestions for improving it even more. We have tried to get the Report up to date and to separate pure history from comments on the scene at the present time.

Yesterday, the right hon. Gentleman said: it may be said that by concentrating, as I have done in the last few minutes, on the Historical Review of 1959,' I am hardly being fair."—[OFFICIAL REPORT. 12th July, 1960: Vol. 626, c. 1199.] I waited with great interest to see how much the right hon. Gentleman would say about the other part of the Report. The truth is that all he did with it was to cast doubts, in many cases strong doubts, on the more optimistic sections in that part of the Report. I do not mind that—here, I come back to a subject which hon. Members opposite do not like, but it is so important that I must refer to it—provided that we can get it into the heads of right hon. and hon. Members opposite that constructive criticism and political controversy are necessary, but that they must be careful not to project an image of Scotland which is basically wrong. [HON. MEMBERS: "Oh."] I am not saying this in fun.

I know from personal experience of the temptations which confront hon. Members, when in opposition, to do that kind of thing, and I know of the damage which can be done. I ask that that he borne in mind the whole time and that when it is possible for hon. Members to do so, outside this highly political atmosphere, they will sound a note of optimism about the things which are good in Scotland. If they will do that it will be an enormous help.

I am convinced that today Scotland is a country of immense opportunity. Our workers are second to none. In the new areas opening up for industry a life is possible for supervisory staff and management such as cannot be realized in the big cities today. These things should be encouraged in a serious consideration of our problems. Not so many years ago industry insisted on grouping in areas which were already congested. Today, industrialists are ready to move out into open sites and into more healthy conditions and thus provide greater possibilities both for those who work in industry and for those who run it.

It was interesting to note that there is today a greater willingness on the part of people to move from job to job and from district to district. For a long time industry has been over-immobile and people were unwilling to move. In Scotland, we have been firmly rooted in the places where we were born and unwilling to move except in the case of those who went out of the country altogether—

Mr. Manuel rose

Mr. Maclay

I cannot give way to the hon. Gentleman. I have little time in which to develop a serious argument.

The Leader of the Opposition said yesterday: It is all very well for the figures for Scotland to go up now and then down again, but if, whether up or down, Scotland remains continually behind, the problem has not been solved. The Scottish economy needs not merely to follow the variations of the British economy; it needs to be jerked altogether on to a higher level."—[OFFICIAL REPORT. 12th July, 1960; Vol. 626, c. 1200.] I do not think that any hon. Member would disagree with either of those sentences.

We must face the fact that despite Keynes, despite the disciples of Keynes, and despite right hon. and hon. economists, the world has not yet got away from its series of economic cycles. They are flattening out, but they are not yet flat. Obviously, it is very much easier to achieve a policy of redistribution of industry in a climate of general expansion than in other conditions. That is perfectly obvious, and everyone agrees with it.

I am trying to draw the moral, because there is an important moral to be drawn if we are to achieve what we aim at. Efforts to obtain a proper redistribution of industry must at no time be relaxed. Above all, we must be ready to move to apply the maximum pressure for redistribution at the right time. That is what has happened, as the figures given by the President of the Board of Trade yesterday showed very clearly.

What is more, we must ensure that the developments we achieve in these periods are the right developments for the long term. People have tended in these two days—this will not be denied—to discount the figures my right hon. Friend the President of the Board of Trade has been giving. No one will fail to agree that they show that, during this particular period, at any rate, we have achieved a most remarkable movement of intention to build factories. [Laughter.] Hon. Members must agree with that, even if they will not go any further.

Hon. Gentlemen opposite are quite wrong in saying that the figures of past years have been wrong and that our figures and intentions have always turned out to be wrong. They should go back through the years and check year by year. It is extremely difficult to get a proper check against the estimated employment at the time the I.D.C. was granted and what happens finally. I can quote cases in my own constituency. The hon. Member for Greenock (Dr. Dickson Mahon) is quite right about this. We have had disappointments. The original I.D.C. has not produced the results we hoped for. However, one must remember the economic cycles.

There is a moral here, because it happens that the firm we both have in mind is one of the lighter consumer industries affected recently by restrictions. They will always be much more sensitive to ups and downs than anything else. We need some of these industries if we are to get the proper diversification, but we do not ever want any one area to become too dependent on one type of light consumer industry. That would be disastrous. We must get proper distribution. This is not a simple problem to tackle.

Dr. Dickson Mabon

I am willing to accept the point the right hon. Gentleman made about the particular matter he mentioned in November, when he was referring to our own constituencies. However, he must admit that on this point it was the President of the Board of Trade and himself who argued that the graving dock in particular would provide 1,000 jobs for Greenock. No one in authority connected with the dock has ever said that. How, then, can this be incorporated in a Parliamentary contention as a matter of debate?

Mr. Maclay

I am sorry. I did not want to get drawn into this, which is of very local application, but I will deal with it straight away. The Scotsman and the Glasgow Herald of 4th March, 1960, reported that the Deputy-Chairman of Lithgows, one of the principal sponsors of the dock, said: In the first place, the dock will make great inroads into the unemployment figures in the lower river. As soon as work starts the actual building of the dock will absorb many hundreds, possibly over 1,000 unskilled men.

Dr. Dickson Mabon

It is a misrepresentation.

Mr. Maclay

The hon. Gentleman must not say that.

Dr. Dickson Mabon

I want to quote the chairman of the Firth of Clyde Dry-dock Company. That company has stated that the dock could employ only 300 men when it is operating. The figure of 1,000 men relates only to the one year of the actual construction of the dock.

Mr. Maclay

I did not want to waste any more time on this, but I must follow it up as the hon. Gentleman has put it on the record. The quotation continues: and once the dock is completed the minimum number of men it should employ on ship repairing will be 1,200".

Dr. Dickson Mabon

That is not on the dock. That is the ship-repairing industry.

Mr. Maclay

The hon. Gentleman is trying to do exactly what he accuses me of doing. This is employment directly consequential on the dock, which could not possibly come in any other way. But we must not take any more time on this point.

Dr. Dickson Mabon

The right hon. Gentleman is misrepresenting me. He cannot blame—

Mr. Maclay

I am sorry. There is not time to go into the detail—

Dr. Dickson Mabon

The Secretary of State is being unfair—

Mr. Maclay

Very well—I do not want to be unfair.

Dr. Dickson Mabon

The right hon. Gentleman might as well claim that there will be very many jobs emerging from the ancillary industries of the B.M.C. In his letter to me, he referred specifically to the dock, as the dock. It is not the whole ship-repairing industry. One might argue that it will bring more than 1,200 jobs—I hope that it will—but that is no argument for saying that the dock itself will solve the unemployment problem in Greenock.

Mr. Maclay

The hon. Gentleman knows that ships come to a dock and that work is done at the dock, and on the quay alongside the dock, and that people will come from Greenock, and other places, to do the repairs. But the employment resulting in Greenock and that area can be very large, though, obviously, no one can tell now what it will be—

Mr. Manuel

Just give us the dock first, and we will talk about the jobs later.

Mr. Maclay

Yes, I agree with that.

The right hon. Gentleman asked about capital investment in Scotland, and many other hon. Members have raised that subject in the debate. My right hon. Friend the Chancellor of the Exchequer was questioned on this matter on Monday, and the House will not expect me to add substantially to what he said. He made it clear then that it is the total investment that is to be held at this year's level, and not each item.

My right hon. Friend also said on Monday that when the detailed programme had been worked out and agreed it would be laid before Parliament. That clearly implies that discussions are taking place between the Treasury and other Departments, and in that connection I will repeat what I said twice in answer to Questions a fortnight ago, namely, that considerations applying specially to Scotland are being taken very much into account.

The Leader of the Opposition dealt quite lengthily with housing in Scotland—[HON. MEMBERS: "Hear, hear."] I certainly do not dispute what the right hon. Gentleman said about conditions of housing in Scotland, but I cannot think that this is a discovery for him. Although, when he spoke, he sounded as though he was very surprised, I cannot believe that his hon. Friends have not told him about it.

Of course, we know that there is a tremendous problem here. Nobody who has lived, as I have lived for many years, in and around Glasgow can ever be content with the conditions existing there, but this is a very big job, and nobody would expect us to solve Glasgow's problems in five or seven years. I agree that there has been a very considerable drop in the total output of houses built by public authorities in Scotland in recent years. We have argued about this before, and the point has been raised specifically in the debate.

One of the main reasons for this is that, in some places, housing needs have been largely met—and I repeat that. That does not mean that there will never be any more building in those areas. There will be, of course, but in those places present needs have been largely met. The second main reason, and it is obvious to anyone who studies the problem, is the increasing emphasis on central redevelopment, which must be a slower process than building peripherally, and that is very relevant to our present problem in Glasgow, where there is now little scope for expansion round the boundaries.

It is very greatly to the credit of the overspill operation and to all the local authorities concerned that by the end of 1962 we believe that the total number of new houses provided by public authorities for Glasgow families in overspill areas, including the new towns, will be running at a rate sufficient to offset the drop in output in the city itself.

The overspill operation in Scotland, however, is not solely for Glasgow's benefit. It can, I am sure, do a great deal to stimulate the whole Scottish economy by making good housing available in any area that may for any reason be attractive to industrial development. If hon. Members will remember what has happened in Irvine, they will realise what a very valuable operation this is. Irvine now has about 11 fresh industries from Glasgow and elsewhere.

One final misstatement I must put right. The right hon. Gentleman—I think, quite inadvertently—referred in the context of housing subsidies to what he called a further slash that had recently been announced. I say "inadvertently"; otherwise, he must have been badly briefed. If he had studied the report of the debate in the Scottish Grand Committee the other day he would have realised that the object of the circular, which, no doubt, he had in mind, is not to reduce the total number of new houses built in Scotland.

Mr. McInnes

The right hon. Gentleman cannot deny it.

Mr. Maclay

I deny it emphatically. What it seeks to do is to concentrate local authority effort in the field where the authorities alone can meet the need, and thus, at the same time, make it less difficult for private enterprise to increase its contribution in the appropriate sphere.

Mr. McInnes rose

Mr. Maclay

I have very little time left.

The hon. Lady the Member for Lanarkshire, North, my hon. Friend the Member for Aberdeenshire, East (Mr. Wolrige-Gordon) and other hon. Members asked questions about B.O.T.A.C. There is one statement that I should like to make on this subject. The technical officers and accountants who deal with all Scottish applications are stationed in Glasgow. These officers give applicants every possible assistance in the preparation of their applications to the advisory committee. I think that that answers the doubt which has been raised.

Miss Herbison


Mr. Maclay

Other hon. Members besides the hon. Lady raised this matter.

Another point that was raised concerns the question of not giving reasons for decisions. This matter has been studied carefully. It is not practical for the advisory committee to give reasons, since in some cases these must be of a very personal nature, but any applicant who desires assistance in the preparation of a revised application is free to discuss his problems with the secretary of the Committee or with any of those acting on his behalf.

Miss Herbison rose

Mr. Maclay

I am sorry, but I cannot give way now. I have exactly two minutes left, and I have given way often.

There is one other thing that I wanted to say. The real test is whether our methods have been properly applied in the long term. I have got all the details here of a remarkable degree of diversification, quite apart from the figures. There is the strip mill. Grangemouth is a new industry. What we have to do—and what is not happening yet—is to get the type of industry there which uses the end products from the chemical industry. Let us all go on working for that.

We have factories manufacturing office furniture, and heavy tractors—such as Caterpillar. Linked to that development are other factories making components and castings for those articles. This is the sort of test that we want to have before hon. Members make the kind of criticism that they have made—are we doing the thing on the right lines and are we having success? What are the suggestions themselves?

Dr. Dickson Mabon

Advance factories.

Mr. Maclay

if advance factories were the solution to the unemployment problem in Scotland, at least the number of words said about them would have solved it long ago. This matter has to be examined, and, in any case, we have never said that we would not build them again. We wanted to see whether the proposition was practicable. There is a strong case for them in certain conditions which have not always prevailed, but as long as there are empty factories it is hard to prove that case. That is the position today. There are various factories scattered about Scotland.

Other hon. Members have suggested that we should build Government factories. Really, that is a very poor solution. I could take twenty-five minutes in examining what the proposal really means. It might conceivably, in one case, solve the problem temporarily, but does anyone believe that that is a long-term solution?

I am told that in the full flight of my oratory I must now resume my seat.

Question put and agreed to.

Resolved, That this House takes note of the Reports on Industry and Employment in Scotland and on Scottish Roads, 1959–60 (Command Paper No. 1045).