HC Deb 28 June 1967 vol 749 cc494-6
18. Mr. MacArthur

asked the Secretary of State for Scotland what study he has made of the movement of employees from service to manufacturing industries in Scotland.

Mr. Ross

Information about changes in employment in all industries, compiled by the Ministry of Labour, is published regularly in the Digest of Scottish Statistics.

Mr. MacArthur

As the right hon. Gentleman well knows, that is not a very helpful reply. Is he not aware that one of the primary purposes of the Selective Employment Tax was to switch employees from service to manufacturing industries? Would he not accept that this silly tax makes no sense in the Highlands of Scotland where only 10 per cent. of employees are engaged in the manufacturing industry? The economic strength of the Highlands lies in tourism, agriculture and the service industries which are constantly and increasingly being penalised by this Government.

Mr. Ross

There is no indication, from what we already know, that the tourist industry in the Highlands is being destroyed because of this tax. The hon. Gentleman should appreciate that the primary purpose of S.E.T. was to raise revenue. If it had not been done in this way it would have been done in another.

Mr. Russell Johnston

Has the Secretary of State requested or received any representations from the Highlands and Islands Development Board about the effect of S.E.T. on its work?

Mr. Ross

Not on its work. We have no indications and we cannot have any indications because Selective Employment Tax began in September last year and a great number of the tourist facilities in the Highlands close down then till early spring. Therefore, it is too early to assess its effect.

Mr. Manuel

Is my right hon. Friend aware, in connection with the tourist industry, that information to hand shows full bookings for the whole of the summer? Many small Highlands hotels are already fully booked and people are going fom home to home trying to obtain bed and breakfast, even now.

Mr. Ross

This is true. All the indications are that the tourist industry in the Highlands is prospering. Indeed, one wonders what hon. Gentlemen opposite are grousing about when one remembers that they were proposing to put a tax on every bed for every night in every hotel and boarding house in the Highlands. They have now changed their minds about it, but that was their intention.

Mr. Noble

No one has ever said that the Selective Employment Tax was destroying the tourist industry. However, it has added a very great burden and there are many parts of the tourist industry—restaurants and hotels—which do not have a lot of beds but have to pay considerable tax and perhaps have to increase charges to the detriment of the area.

Mr. Ross

I do not know how it is to the detriment of the area if the tourist industry is flourishing more than ever.

Mr. Noble

It is clearly to the detriment of an area like the Highlands if it has to put up its charges merely in order to cover the tax.

Mr. Ross

Only if it has a detrimental effect on the industry, and there is no indication that it has. The right hon. Gentleman must have had this in mind when he himself was the architect of the bed tax for Scotland.