HC Deb 21 March 1963 vol 674 cc797-808

Motion made, and Question proposed, That this House do now adjourn.—[Mr. I. Fraser.]

2.42 a.m.

Mr. David Webster (Weston-super-Mare)

Tonight, I wish to raise the problem of unemployment in Weston-super-Mare. In January of this year the unemployment rate rose to the high figure of 6.3 per cent. It did this abruptly, and then increased to 6.7 per cent. in February. That represented a total of 1,189 people, of whom 871 were men, 219 women and—a tragic thing—54 boys and 45 girls.

It is encouraging to note that the new figures announced today, for this month, show a percentage of 4.6 per cent., totalling 805 people. Of these, 567 are men, 186 women, 23 boys and 29 girls. There are indications that the worst is over in relation to the short-term problem. But this is not a short-term problem alone. There is a long-term problem that for many years has been pertinent to Weston-super-Mare.

Two Government factories were built a considerable time ago. They are both excellent factories, and it is with the employment provided by those factories that I am concerned tonight. We learn that the War Office contract, under which the firm of Henly is working in one of the factories—employing 450 people—is being run down over a period of three months. There is a similar situation with Westlands, at the other factory, but I wish to concentrate upon Henly's. We must appreciate that these factories were built with State aid, some time ago, and that when they become empty the problem that arises will not only be a long-term one, but one that may involve considerable finance before they are once again filled. For this reason I welcome the presence here tonight of my hon. Friend the Minister of State, Board of Trade, because one has to be very selective as to whom one addresses this very complicated problem.

This is a War Office contract which has also sub-contracted a certain element of Air Ministry work. It is done in a factory controlled by the Ministry of Aviation as trustees of the taxpayer. The Ministry of Labour is involved and the Board of Trade. There is also the possibility of the Ministry of Public Building and Works being involved, and, in the last resort, there would be the involvement of the Treasury. I have put down Questions to a number of these Departments and have visited four of them. I much appreciate the courtesy which I have received from my hon. Friends the Under-Secretaries and Parliamentary Secretaries of the Departments concerned. To those Departments which I have not yet visited, I should say that I hope they will not feel neglected, because in due course I shall be making visitations to them if I am not soon satisfied on this matter.

There is a close chronological order of importance here. This is a War Office contract in a factory controlled by the Ministry of Aviation, a War Office contract administered by the only central factory with engine repair and maintenance workshops. Much is made of the fact that work has been moved up to the north of the country, to Scotland, Liverpool and Doncaster, but it is clear that when we have a seasonal figure of unemployment of 6.7 per cent., that area needs work and it needs a stabilising influence upon it through that work.

In the case of a Weston-super-Mare there is no reason for saying that it is a black spot or a neglected area. It is only three hours by rail from London and has excellent communications with the Midlands and London by road and rail with the possibility—or strong prospect—of motorways connecting up both areas to Weston-super-Mare. It has excellent dock facilities at Avonmouth and every attraction for the industrialist. We are not saying that we are an area which is a black spot, but a most attractive area to which we can easily encourage industrialists to come.

The War Office has decided to contract within three months the factory for the repair of vehicles. I ask, first, that the contract should be extended and a longer period of grace given. Henly's, for fifteen years, with the assistance of good workpeople and excellent labour relations, has given good service to the taxpayer. As a member of the Estimates Committee, I am bound to say that if we are to leave this factory—an asset which I guess is worth £1 million—without employment, Government assets are not adequately employed. That is a double reason why emphasis should be placed on spinning out this contract.

In conjunction with extension of the period of grace, or surplus to it, I ask for a relaxation of the exclusive nature of the War Office contract. Last summer, when it became evident that both Henly's and Westlands would have a reduction of the business carried on at the site in Weston-super-Mare, I visited both managements, Westlands at Yeovil and Henly's on its site, and discussed the problem. As a result of our consultation I made representations to the Under Secretary of State for War and as a consequence the contract was extended beyond the direct type of Government contract. The strict contract involves Government contracts for Government Departments. We sought to get this extended to local government and services of other countries, such as the United States Air Force, and even into the nationalised industries, so that this company should be able to use the benefit of this Government controlled asset and good labour relations to carry out this work. As a result of this, there was some relaxation. I am most thankful that this happened this year, when we had the extreme rigours of winter, which greatly added to the unemployment figure in Weston-super-Mare.

What I would now like is this. Either in conjunction with the relaxation, the slowing down process, or separate from it, this exclusiveness should now be dropped. The management is most progressive. It is going ahead and trying to find orders. But, until the relaxation of the contract is given, it cannot sign any other contract for this type of work. I ask my hon. Friend to urge his hon. Friend the Under-Secretary of State for War, as I have urged him this week, that this question should be looked into most urgently. I appreciate the Government's point, or the point of the administrators of public money, that this company should not be seen to be getting the best of both worlds. We appreciate that these contracts are at present on a cost-plus basis and while being run down will be most costly per unit. Therefore, it could he said that it could be one or the other.

However, this is a case in which one should temper the wind to the lamb to be shorn. I ask that this be done. My hon. Friend knows that his Department gives three forms of aid under the Local Employment Act: first, the building of advance factories; secondly, finance for the building of factories and, thirdly, finance for current account. We do not need factories. We have them. It would therefore, be a fair economy if something were done to make a lenient interpretation of the lease or the holding lease to be negotiated with the Ministry of Aviation, otherwise there may be considerable expense involved in bringing other people to the area.

I understand that we are at present at the stage when the district valuer is making his assessment. Let us hope that the valuation will be one that the company will find acceptable and that no inhibitions will then be placed on it having other contracts.

I appreciate that, if the company were to stand out and say that the terms were excessive, because of the expense of heating and lighting the factory, especially heating it, the Treasury would be called in. I understand this to be a matter of commercial prudence as well. I fully appreciate that the Ministry of Aviation would wish the lease or the heads of agreement of the holding lease, for, say, fifteen months, to be signed before it would say to the company that it would extend its contract so that it could take on non-direct departmental governmental work. Let us hope that we can press the company, which has good relations in Weston-super-Mare, to make a commercial decision to stay there. I hope that the terms will be appropriate.

Let us be realistic. If there is no agreement on this aspect, let us hope, first, that the company and also the Ministry of Public Building and Works go on from there, because there is a great deal of pressure now to prefabricate constructional work. I fully appreciate that this can be taken too far and can almost be made a gimmick, but with high transport costs a prefabricated component is not an economic proposition. On the other hand, in the West Country, particularly near Bristol, a considerable amount of new building, and, I think, public building, is going up, and it would be appropriate if that type of work were carried out in this type of factory. This is another thing on which the company could make approaches, and, indeed, has made approaches, to the Ministry of Public Building and Works. I hope that these approaches will be successful.

My hon. Friend is probably wondering where the Board of Trade comes into this. I appreciate that this subject was originally put down for the War Office. Then my hon. Friend had the great fortune to draw it himself for three o'clock this morning. The subject I want to raise with him is the problem of the industrial development certificates. We have been in the process of building up the Birmingham overspill arrangements and these have been going satisfactorily. This has been applauded by Weston-super-Mare and Birmingham businessmen. However, there was a complication about a year ago concerning the granting of industrial development certificates.

As most hon. Members know, the commercial world can be quite small. Once it gets about in a city like Birmingham that Weston-super-Mare is a difficult area in which to get I.D.C.s the poison has been spilled and will spread rapidly. I hope, therefore, that my hon. Friend will assure the House that no difficulty will be placed in the way of I.D.C.s being granted. This is a particularly important topic for Weston-super-Mare, for it is not basically a heavy industrial area. On the other hand, if we were to lose the industries we have it would be detrimental to the social structure of the whole area served by the Weston-super-Mare Employment Exchange.

If the factories close and we lose our skilled and semi-skilled labour to other places there would be great difficulty in getting them hack and I cannot think that such a development would lead to the health of the area. In this connection, there is the deep human problem which would be caused by unemployment. A little generosity would avert a great deal of human misery. I stress, as a member of the Estimates Committee, the importance of the Government being generous because this would save the expenditure of a considerable amount of public money in the future.

For that reason, I urge my hon. Friend to give us all the help and assurances that he can.

2.57 a.m.

Mr. Charles Loughlin (Gloucestershire, West)

In associating myself with the remarks of the hon. Member for Weston-super-Mare (Mr. Webster), I would point out the great degree of co-operation which exists among all sections of the community in this area.

A number of hon. Members have received representations from local trades councils and similar bodies. I urge the Minister to do something constructive about the question of I.D.C.s in view of the situation in which the town now finds itself. I am referring not only to the existing unemployment figures, but to the possibility of further unemployment as a result of the running down of Henly's and Westlands. I urge him to ask his right hon. Friend to speed up, for example, the project of the technical college and to consider the possibility of replacing the two hump-back bridges. Work of this kind would avoid the possibility of higher unemployment figures.

Although the number of unemployed may appear small at the moment, a genuine fear exists in the South-West that the concentration of effort being made to reduce unemployment in the North-East, Scotland and elsewhere may mean that unless the Government are careful they may be stopping up holes in some areas and creating others in places such as the one under discussion.

2.59 a.m.

The Minister of State, Board of Trade (Mr. Alan Green)

I accept at once the premise of my hon. Friend the Member for Weston-super-Mare (Mr. Webster) that his constituency is an attractive place. He has put the case for this town in a persuasive way and has rightly said that a number of Departments are involved, I will try, in my turn, to deal logically and in sequence with the points he raised.

I know that the War Office much regrets the need to reduce its workshop capacity as a result of its contract policy in regard to Henly's, in Weston-super-Mare. As my hon. Friend knows, the War Office vehicle repair workshops have catered mainly for the overhaul of vehicles on a strip-and-rebuild basis, and since this type of work has been reduced considerably it has been necessary to reduce total workshop capacity. Of the six workshops concerned, three are closing down and three are to be retained. We have to argue from the general down to the particular.

My hon. Friend will also understand, I am sure, that many technical factors, on which I am not competent to speak, had to be taken into account by my right hon. Friend the Secretary of State for War in deciding which workshops would have to be given up. I should like to make it clear, however, that this is not a case of a Government decision to transfer work from the South to the North as part of the Government's general measures to relieve unemployment in the North. In deciding which workshops would have to be given up, my right hon. Friend took into account the relevant factors, including the most economical way in which the remaining work could be done, and Weston happens to be a large one with a high economic work load. I am sure that my hon. Friend, with his knowledge of the town, knows this.

My hon. Friend wishes to seek an extended period of grace for the turndown of Henly's War Office contract, and no doubt he will be taking this up direct—if he has not already done so, and I rather suspect that he has—with the Secretary of State for War, but perhaps I should say that I understand that my right hon. Friend would find it very difficult to agree to a longer period of turn-down at the Government's—that is, at the taxpayers'—expense.

We all realise that redundancies are likely to occur, not only amongst Henly's workers, but as a result of the gradual run-down of employment by Westland Aircraft. I understand that, although the firm's intentions are not altogether clear, Westlands is concentrating its main activities on Yeovil, Hayes and Cowes, and plans to reduce its direct labour force at Weston to about 300 in this year. That is a melancholy fact, but it is right that we should face it and see what can be done about it.

Unemployment in Weston as a holiday resort—

Mr. Loughlin

Before the Minister leaves that point, is it not true that Westlands is running down to 200, not 300, during this year?

Mr. Green

I cannot possibly, I think, give any such definite forecast. I can only give what I understand, and cannot pretend that I am absolutely a perfect prophet. I understand that the intention is to reduce the labour force to about 300 during the course of this year, but I cannot give an absolutely definite statement, and hope that I shall not be expected to do so.

Unemployment in Weston, as a holiday resort, is subject to considerable seasonal fluctuations, and I know that my hon. Friend does not expect me to change the seasons, because this would hurt the town as a whole. Hitherto, Weston's unemployment, although above the national average, has not been acutely serious. I know that the figures have shown a considerable increase during the first months of this year, but that is in line with the national trend, which has been affected by the severe weather and, as my hon. Friend has pointed out, there has been a welcome improvement in March—with the coming of the first snowdrops. This is true nationally, as well as locally.

My hon. Friend raised the point about the acceptance of further contracts by Henly's as long as the War Office contract remains in force. I understand that the general policy of the War Office, which is in accordance with the legal position as defined in its operating licences, has been that Government-owned workshops should be run solely for work on Government vehicles, but, exceptionally, in certain cases, the War Office has permitted contractors to undertake certain semi-public work—for example, in Weston, work provided by the South Western Gas Board—and will be discussing any proposals the firm wishes to make for taking on private work while the War Office contract is being run down. I hope that that meets one of my hon. Friends detailed points.

Any space that may be thrown up as a result of, the contraction of Henly's and Westlands is likely to prove attractive to firms that might not be able to expand in Birmingham itself, or in Bristol itself.

I understand that the Ministry of Aviation which owns this factory will be glad to agree to any reasonable proposals for sub-letting space and, subject to what I have already said about the need to give priority to steering new industry to development districts, we shall not stand in the way of such suitable firms that may be interested in taking over available space.

My hon. Friend has pointed out the many advantages offered by Weston-super-Mare to industrialists. He has also asked the Board of Trade to be generous in considering the unemployment which might be expected to arise if Henly's is obliged to give up operations and if Westlands carried through its intentions of a substantial rundown in manpower this year. To this I must answer, as I think my hon. Friend appreciates, that it is yet too soon to be sure that there will be serious long-term unemployment in the town.

Mr. Loughlin


Mr. Green

I must not encourage fears, if the hon. Member for Gloucestershire, West (Mr. Loughlin) will permit me to say that.

We know that Henly's, which has shown much initiative in its efforts to secure new private contracts, has already shown an interest in the possibility of continuing the lease of its premises from the Ministry of Aviation, and we hope that it might find it possible to obtain new work and continue to employ at any rate a proportion of its existing labour force. I assure my hon. Friend that I understand the balance of skills which matters in any existing industrial undertaking or complex.

I understand that Henly's proposes to make prefabricated buildings and building components, and that my hon. Friend has already heard from the Parliamentary Secretary to the Ministry of Public Building and Works that it is interested in this proposal. This is where the complication of having various Departments continues to come in. I understand, also, that the firm's particulars have been noted by the Director-General of Research and Development. This is as yet in its early stages, but as soon as possible the offer made by Henly's will be followed up. In addition, the Ministry of Labour will do everything in its power to find suitable employment far those workers who become redundant from Henly's or West-lands, and as the economic climate improves and industrial expansion continues we hope that many of these men will find new jobs without too much delay.

The Board of Trade for its part will be keeping a careful watch—and this is not an idle phrase—on the position in Weston-super-Mare. We hope and believe that during the next few months it will prove that the employment problems of Weston-super-Mare are not as intractable as may be feared at present. While our first obligation must still be to try to find suitable new industry for development districts where high and persistent unemployment exists, and I am sure that the hon. Member for Gloucestershire, West, with his wide national sympathies, will not dispute that, I assure my hon. Friend that we shall deal sympathetically with applications for industrial development certificates in Weston-super-Mare by firms willing to move there and which are not able to go to any of the development districts.

My hon. Friend mentioned a case where there was delay in granting an i.d.c. to a Birmingham firm which was proposing to move to Weston-super-Mare under the overspill scheme. This firm made two applications. The first made two years ago was rejected. A later, revised, application was granted without any undue delay. I assure my hon. Friend that we are well aware of the importance of dealing with these applications as quickly as possible. I am sure that he, in his turn, will understand that while "No" can be said very quickly, "Yes" often involves making a number of inquiries, because one wants to be sure. As for the movement of firms from Birmingham to Weston-super-Mare, generally our first consideration in dealing with expansion proposals by firms, whether from Birmingham or elsewhere, is to try to steer them into development districts. I am sure that I have the sympathy of the House in this.

Subject to this overriding priority we shall be prepared to issue industrial development certificates for Weston in all suitable cases. I am told that we have not refused any i.d.c. for Birmingham firms wishing to go to Weston.

Question put and agreed to.

Adjourned accordingly at ten minutes past Three o'clock a.m.