Local Employment Act

HC Deb 14 March 1963 vol 673 cc1504-7

10. Mr. W. Hamilton

asked the President of the Board of Trade if he will now introduce legislation to amend the Local Employment Act so as to enable more effective action to be taken to solve the unemployment problem.

Mr. Erroll

No, Sir.

Mr. Hamilton

Can the right hon. Gentleman confirm or deny that the gap between the ratios of unemployment in the development districts and the rest of the country has actually widened since the introduction of this Act in April, 1960? Will he now frankly admit to the House and to the country that this Act was a mean, shabby and dishonest election "gimmick" in the 1959 election?

Mr. Erroll

I would have to look into the figures closely before confirming or denying the hon. Gentleman's claim about the ratios. The Act has brought immense benefit to the development districts and particularly to Scotland. Having said that, however, I do admit that it has not solved the unemployment problem in Scotland. But we must remember that employment opportunities arise not only through new factory building but through a higher level of activity in existing factories.

Mr. Hamilton

Does the right hon. Gentleman recognise that the greater number of jobs provided in Scotland have been brought in by the motor car industry, which the Government were in any case intending to get to Scotland and which was going there before the introduction of the Act?

Mr. Erroll

I should settle that one straight away. I am certain that my predecessor would never have succeeded in getting these two large motor firms to Scotland had it not been for the power granted by this House under the Local Employment Act.

Mr. Hector Hughes

Does the right hon. Gentleman realise that his policy, or lack of policy, has not provided jobs for a vast number of unemployed in the north-east of Scotland? Will he look at the figures given yesterday by the Minister of Labour, which verify what I have just said? Will he put forward some positive, concrete policy to enable a greater number of unemployed in the north-east of Scotland, particularly in Aberdeen, to be absorbed in productive industry?

Mr. Erroll

It is my responsibility to try to steer expanding industries to development districts. I have been more successful, as was my predecessor, in some districts than in others. But we are conscious of our shortcomings in Aberdeen. We continue to bring Aberdeen to the attention of likely industrialists.

11. Mr. Jay

asked the President of the Board of Trade to what extent the reduction in the Estimate for promotion of local employment in the Vote on Account, 1963–64, reflects the Government's forecast of industrial activity during that year.

Mr. Erroll

Expenditure under the Local Employment Act in any given financial year relates mainly to projects offered assistance or begun before the beginning of the year. The estimates for 1963–1964 do not, therefore, imply any forecast of industrial activity in that year.

Mr. Jay

Is it not making a mockery of the Government's protestations that they are doing their best with this problem if, with unemployment at over 900,000, the Board of Trade's expenditure on the promotion of local employment is to be cut this year by 40 per cent., from £40 million to £24 million? Can the right hon. Gentleman explain?

Mr. Erroll

The cut is being made partly because the exceptional expenditure on the motor vehicle plants is approaching completion and also because we try to make our estimates realistic. This is not a case of a cut but of an estimate made on the best information we have at the moment of the expenditure likely to be incurred.

Mr. Jay

But is it not the case that even allowing for the expenditure on the motor vehicle plants, the right hon. Gentleman expects to spend much less this year under the Act than in the previous year?

Mr. Erroll

The estimate is the best we can make at the moment.

14. Mr. Grey

asked the President of the Board of Trade what are the criteria of unemployment which are applied before an area is placed on the list to qualify for a grant under the Local Employment Act, 1960.

Mr. Erroll

Under the Act I am empowered to list as a development district any locality in which, in the opinion of the Board of Trade, a high rate of unemployment exists or is threatened, and is likely to persist. There are no fixed criteria. I take account of the relative degree of unemployment in the area, compared with the rest of the country, and also of any likely developments in the future which might lead to further unemployment or, alternatively, create new jobs.

Mr. Grey

The House has been informed that there is no criterion, but will the right hon. Gentleman explain how it is that the figure of 4.5 per cent. is used in the Second Annual Report on the working of the Act? May we be assured that a definite criterion will be used in future? Will the right hon. Gentleman also explain why on 19th February his hon. Friend the Parliamentary Secretary denied that such a figure was ever used?

Mr. Erroll

The first Annual Report indicated that the figure of 4.5 per cent. was used in the initial year, but it also pointed out that the rate was not fixed permanently and that changes in the national average might make it appropriate to modify it from time to time.