§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Walter Harrison.]
§ 10.57 p.m.
§ Mr. Gordon A. T. Bagier (Sunderland, South)I welcome the opportunity to address the House on what seems to have become a very serious state of affairs in Sunderland. I refer to the level of unemployment, particularly unemployment among men. The deep concern of my constituents on this matter etas been represented to me by bodies such as the trades council, the Confederation of Shipbuilding and Engineering Employers, and by groups of trade unionists as well as by individuals.
It could well be argued, with justice, that the North-East, along with the rest of the country, is undergoing the pangs of recovery from the catastrophic economic mess which we inherited in 1964. It could be argued, also, that Sunderland and the North-East are suffering from a state of change in the pattern of industry rather than from a deep malaise, that many of the firms which are closing down would eventually have closed anyway, and that many plans for expansion or the introduction of new industry are being held in abeyance against the day when there is some relaxation in our economic situation.
Whatever the reasons, the unemployment figures for males in Sunderland are acceptable neither to me nor to those whom I represent. Two days ago, in reply to one of my hon. Friends, the Joint Parliamentary Secretary to the Ministry of Labour said that unemployment in the North-East generally totalled 48,689, or 3.6 per cent., in June, 1967, as compared with 3.2 per cent. in June, 1962. These are high and serious figures, nearly 50 per cent. higher than in the remainder of the country. But Sunderland itself is hit even harder.
The latest information available to me is that the overall figure of unemployment at the employment exchanges in Sunderland is 5.2 per cent., or 4,834. But the most important thing as I see it is that 7.2 per cent. is the figure for male unemployment, as compared with 1.8 per cent. for female unemployment. This compares with 3.3per cent. last 970 year. Worse still, we have more than doubled the male unemployment figures in Sunderland over a period of 12 months. Indeed, if one takes the figures going back as far as 1951, in only one year, 1963, were the male unemployment figures higher than they are today.
If I had to take some comfort from a trend which was showing some reduction, one would feel that one could explain this to one's constituents. But this is not so. These figures have shown an unfortunate trend. I hope that my hon. Friend the Joint Parliamentary Secretary will appreciate the seriousness of the trend as against the actual figures when they increased in May from 7.1 to 7.2 per cent. and from 6.9 per cent. in April to 7.1 per cent. in May, showing an unnatural trend for the time of year. In other words, there is no sign of a seasonal improvement which one would normally expect at this time of year. When these figures are examined in detail, they show that there is an absolute waste of skills in this part of the country.
I have taken the trouble to break down the figures in terms of skilled men. Quite often it is said that in the development districts, in spite of an overall figure of unemployment, there is a shortage of skilled trades. For some very highly sophisticated skills this may well be true. But in the catchment area of the Sunderland district, we have now 141 fitters unemployed, 79 painters, 74 joiners, 61 machinists, 56 welders, 47 platers and even 19 electricians—who have not appeared on the labour exchange register for some years—11 plumbers, sheet metal workers, bricklayers, and so on.
These are skilled men. I hope that my hon. Friend the Joint Parliamentary Secretary will take due consideration of the fact that in these figures of unemployed there is a potential which should not be ignored by himself or the Government. That is not the end of the story. Only announced in our local newspaper on 12th July was a further lay-off of 90 men by the firm British Crane and Excavator Corporation, a further rundown. In its statement—the company says that probably the reason is the lack of orders because of economic and other considerations.
What has Sunderland to offer? We have in the North-East, and Sunderland in particular, 170 acres of industrial sites 971 ready for use. We have this skilled, hardworking labour available. It is amongst the best in the country and will stand comparison with the best in the rest of the country. I think I can speak for the trade union leaders in the area in saying that they are willing to co-operate with any new industry which is prepared to settle in the area. There is a first-class environment for top management. I mention top management particularly because too often we have been used as a sort of outside factory space. It is unfortunate that sometimes our advance factories are used by London and Birmingham based firms to deal with their overspill. Whenever there is a slight recession or a squeeze, they are the first to empty and disappear.
The requirement in the North-East and Sunderland is for complete firms, complete with managements, who want to go there. I mention environment particularly because the image which is sometimes created in the South by what we have to offer in the North is particularly unfair.
We have beautiful countryside and fine stretches of beach. We have good living accommodation. Anyone who has a motor car is able to move in it. The area presents a first-class opportunity. Indeed, it offers a favour to industry and top management to come. We have good communications, and dual carriageways practically all the way to London. Liner train terminals are shortly to open up. The area opens up opportunity to industry which is prepared to come and help itself.
I would defend the Government in their attempts to help. They have applied far stricter restriction on industrial development certificates than did their predecessors. They have attempted to insist on industry moving out of some places. The redeployment of Government offices is an example which the Government have set. They have banned the building of offices in the areas of London and Birmingham. All this has helped to make industry move out and redeploy itself in the regions.
Investment grants of up to 45 per cent. on capital are offered in the development districts. The development districts have been greatly enlarged since the Labour Government took office. There is assist- 972 ance in industrial training grants for firms in development areas. If a firm is prepared to train its own personnel for additional jobs, it can receive cash grants from the Government. I understand that a 60 per cent. grant is allowed for machine tools installed for training purposes.
I am sorry that I have not given prior notice of this question to my hon. Friend the Joint Parliamentary Secretary, but I would be interested to know exactly how many firms in the private sector have taken advantage of that. My information is that in the North-East very few—indeed, possibly none—have done so. If it is possible to give the answer at such short notice, I would be interested to know whether my information is correct.
The Government have bent over backwards to try to encourage the private sector to come to the North-East. Indeed, when the Government took the necessary economic measures which they had to take at the time of the squeeze, they tried to protect the development districts, and the North-East in particular, from the full effects of those measures. That is in great contrast to what happened under previous Administrations.
What, therefore, can I suggest that the Government can do, or what can I suggest to try to help in the short term—because I believe that the short term is our biggest problem in the North-East and in Sunderland? With the long-term measures which the Government have taken, including the regional employment premium which comes into operation in September, we may see some fairly quick results.
The private sector has been offered all this—capital grants, industrial training and now the regional employment premium. I have got sick to death of the present and other Governments going down on their knees to private enterprise and expecting it to respond. We are handing it tremendous amounts in cash. What has happened to the "enterprise" in the title "private enterprise"? Why is it not taking advantage of all this? Not only would it help my area if it did, but it is essential for the country.
The types of skills which I have listed, including machinists, fitters, platers, sheet metal workers and electricians—people who should be occupied 973 in helping towards enlarging the national cake instead of drawing off it in the form of unemployment benefit—should be taken up. Instead, the cash assistance which is provided for private enterprise to do this is falling on stony ground.
There is no room for old and decaying industries—the North-East has suffered particularly badly from that type of industry— badly managed, grossly inefficient and bolstered up by Government handouts. There is a great future for young elterprising growth industries which are willing to take advantage of what we can offer. The production rate can go up if thee great skills are not wasted a id are not merely redeployed. The challenge, is clear. If private enterprise will not take up this challenge, public enterprise must do so. The country's wealth depends on improving its national cake: it depends on what it produces, and the workers in Sunderland, with the other workers throughout the country, want to play their part. They do not want to spend their time at labour exchanges. They want to use their excellent sikills in enlarging this cake.
I ask my hon. Friend the Parliamentary Secretary to make my views known to his right hon. Friend the President of the Board of Trade, who I hoped was to have replied to this debate. I want the President of the Board of Trade to know that if private enterprise will not do this, he ought to encourage public enterprise to do so. This is in accordance with our manifestos of 1964 and 1966. I ask the Parliamentary Secretary to use whatever influence he has in this direction to alleviate and bring about a reduction in the very serious unemployment situation which has arisen in Sunderland in the last couple of years.
§ 11.11 p.m.
§ The Joint Parliamentary Secretary to the Ministry of Labour (Mr. Roy Hattersley)We have had a very fine example of an hon. Member using an Adjournment debate not only to remind the House of the problems of his constituency but also to remind the country of the advantages and the virtues of the help that his constituency can give to the nation as a whole. It was a rewarding experience even for me, the last survivor in the House from the two all-night sittings which have preceded today's events.
974 Clearly, the situation that the hon. Gentleman outlined is serious. The Government would not pretend for a moment that the situation that he has described is not one to which we should look with a good deal of concern and apprehension.
Let me remind my hon. Friend of the exact nature of the situation and the fact that on 12th June this year there were 5,025 people wholly unemployed within the county borough of Sunderland and within the related employment exchange area of Washington. The fact that the number of people registered as temporarily stopped is very small in no way mitigates the very serious situation which my hon. Friend has outlined. It is a situation which I confirm is regarded as serious by the Government. The Government regard it as a situation which needs urgent and immediate action. Although we understand the need for urgent and immediate action, it should also be explained that, as my hon. Friend knows, the problem which has to be tackled is longstanding and deep-seated. That is a problem which has existed in areas like his constituency for most of this century.
I do not pretend that the fact that it is deep-seated and longstanding makes it any better. It may well be that the fact that my hon. Friend's constituency has a long history of unemployment and uncertainty means that the problems are all the greater for those people who, between the wars and since, have never had the sort of stability, certainty and security that would prepare them for a short period of unemployment. But if we are to understand the nature of the problem facing Sunderland and if we are to make cogent attempts to solve the problem, it is important to understand how the problem arises and how long it has been going on.
It arises basically from the area's dependence on too few industries—basically heavy industries which are particularly vulnerable to periods of economic uncertainty and are particularly vulnerable at times of disinflation. I refer to three basic industries—shipbuilding, coal mining and marine engineering. They are three industries which since their development on a large scale, and since the operation of the modern economy, have always been hit first, hardest and longest during periods of disinflation. It is Sunderland's misfortune, as it has been for many years, to be particularly dependent 975 on them. The Government would say that it is over-dependent on them. In times of disinflation they are particularly susceptible to difficulties and troubles, and even in times of maximum demand prove incapable of meeting all the needs of the potential employed population in the area.
In this period of technological change and advance these industries are making fewer and fewer demands on the working population of the area. Over the five years between 1960 and 1965 employment within them has fallen by rather more than 2,000 adults. In terms of demand for labour at least, they are declining. I must tell my hon. Friend in all honesty that their future prospects are mixed. As he knows, there are in the area about which he is particularly concerned two coal mines the future of which is at least partly in doubt, although there are three which seem likely to continue. I am sure that he knows that there are shipbuilding orders in the yards stretching into 1968–69, but they are not substantial and are not as great as the shipbuilders would wish. I am sure that he also knows that redundancies were recently declared in the principal maritime engineering companies in the area.
Therefore, if we are to solve the problem which my hon. Friend has set out so clearly and cogently we must look at it in terms of finding new industries, rather than relying on these industries which have shown themselves, through no fault of their own but through the fault of the economic system as we know it, to be incapable of providing continuous total employment for the area. The answer is clearly new industries in several senses—new factories, new developments, new projects, and producing new capacity, new capital resources. They must be new industries concentrating on new techniques and products, industries which are less susceptible to economic fluctuations than the old and provide a degree of diversification for the area, and which offer the sort of stability which could not come from over-dependence on the three basic trades which have characterised the working life of Sunderland for the past 100 years.
Perhaps principally among the industries on which the constituency, the County Borough and the surrounding area 976 must rely are the engineering and electrical goods industries. The record shows that already that sector is expanding fast within the Sunderland and Washington areas. The fact that there has been an expansion of 44.4 per cent. in jobs between 1960 and 1965 is eloquent testimony to the case which my hon Friend made that industries which are prepared to go to Sunderland and areas like it find fruitful opportunities, manpower available, and possibilities of developing in a way which is perhaps not open to them if they choose to remain in the overcrowded areas of the South and Midlands.
I hope that many more new firms will look at the successful example of these factories within the engineering and electrical goods sector and will feel that they, too, can make some contribution of benefit to the area and to themselves by moving there. Certainly it would be the Government's intention to help them all that they can.
As my hon. Friend knows, two Board of Trade industrial estates already exist; one advance factory is already in occupation; two more advance factories should be completed by August, and the Development Corporation has projects approved for nine more—all these things despite a shortage of good industrial land which my right hon. Friend the President of the Board of Trade tries to overcome by making sure that the officers of his Department do all that they can to find and utilise every potential site in the area. It is because of these positive policies that the Government is able to point to a very substantial record in the field of its industrial development certificates. Last year, there were 14 certificates, producing 670 new jobs, and 14 also in 1965, producing 1,020 jobs. In the first quarter of this year, six have been issued, providing 520 jobs. Clearly this sort of record must give my hon. Friend every encouragement. If this continues for the final three-quarters of this year, then the prospects for the area's improvement are good.
§ Mr. Bagier rose—
§ Mr. HattersleyI cannot give way. I have only three minutes left and, in fairness to him as well as to this area, I must deal with his substantial points before the rules of order facing me make that impossible. The most important point concerns the new measures which the 977 Government has brought into being to see that the industrial expansion necessary for the area is made possible.
My hon. Friend spoke of capital grants and the special assistance which is available for training semi-skilled men within the area. There is a 70 per cent. grant for financing semi-skilled training in development areas, but I must confirm my hon. Friend's suspicion that at this moment there are no firms in his area using equipment which has been financed in that way. They have had only since last March to (ID this, and it takes some time for the scheme to get off the ground and for assistance with semi-skilled training to get into operation. But the scheme is being carried forward.
At the same time, the most progress, we believe, must come from the regional employment premium. My hon. Friend has reminded the House that every manufacturing organisation which works in Sunderland, or which develops a new factory there, or expands an existing factory, will receive from next autumn a substantial extra sum of money for every man and woman which it employs. We have never before in our history decided to give continuing encouragement—a running incentive to our industrialists in the form of constant revenue for industrial expansion—and I believe that those firms 978 which are faced with making the marginal decision of staying in Sunderland, of expanding there, or of building outside the development area, will find that the prospect of an extra thirty shillings a week for every man they choose to employ in that area is a potent inducement to stay or to go there.
This is a most powerful factor in the manufacturing areas such as Sunderland in attracting, and then retaining, the sort of manufacturing capacity which is so necessary for the reduction of unemployment. I assure my hon. Friend that the Government says that to have 5.2 per cent. of the population unemployed is a waste industrially, a social waste which is inexcusable and unforgivable, and it is because of that that this premium has been introduced. It will, we think, do much to solve the problem to which my hon. Friend has referred tonight. It will also, in future years, enable those areas like Sunderland, traditionally faced with unemployment compared with the more prosperous parts of the country, to operate at full steam and to use all their talents. This, we say, is locally desirable and nationally essential.
§ Question put and agreed to.
§ Adjourned accordingly at twenty-five minutes past Eleven o'clock.