HC Deb 27 May 1968 vol 765 cc1218-21
37. Mr. R. W. Elliott

asked the Secretary of State for Employment and Productivity if she is aware that there has been a fall of 9,000 in the number of persons employed in manufacturing industries in the Northern Region in the year ended June, 1967; and what steps she will take to find employment for these people.

The Under-Secretary of State for Employment and Productivity (Mr. E. Fernyhough)

I am aware of the estimated reduction in manufacturing industries in the Northern Region during the period June, 1966, to June, 1967. This reduction was a percentage decrease of 1.9 and compares with a percentage decrease of 3.1 in persons employed in manufacturing industries in Great Britain as a whole, for the same period. My local offices are doing all they can to provide alternative work for those made unemployed, including offers of training facilities where appropriate.

Mr. Elliott

I appreciate the hon. Gentleman's point on comparative percentage falls, but does he appreciate how very serious this fall is, particularly as the latest D.E.A. figure on the jobs needed to replace those lost in contracting basic industries is 17,000 annually?

Mr. Femyhough

Yes, I very much appreciate this need. During the last six months several major firms have announced that they are going to the North-East. We shall continue to encourage firms which will provide alternative employment and bed themselves down there to do so.

Mr. Leadbitter

Does my hon. Friend appreciate that these comparative percentage figures do not truly reflect the deep concern felt in the area? There are two points which he might examine. First, will he consider that the Tees-side and Hartlepools area cannot afford any more unemployment? I refer to the Furness shipyard. Secondly, will my hon. Friend report to the Secretary of State the urgent need to review once again the effect of S.E.T. and the Regional Employment Premium on the Northern Region?

Mr. Fernyhough

As last Thursday I met all the local employment committees covering the Northern Region, I can assure my hon. Friend that I am fully aware of the problem throughout the region. During the last two months announcements in relation to Tees-side— Monsanto, I.C.I., and various other firms—provide some hope that there will be increased employment in the area. I wish that my hon. Friend would address his questions on S.E.T. to my right hon. Friend the Chancellor.

Sir J. Rodgers

The S.E.T. was surely introduced to shift people from commerce to manufacturing. As it has completely failed in this objective, will not the hon. Gentleman make representations to the Chancellor to have this tax abolished everywhere?

Mr. Fernyhough

The right hon. Gentleman knows that the Chancellor has asked Mr. Reddaway to look at the effects of S.E.T. We shall have to await his report.

Mr. Conlan

Does my hon. Friend appreciate the extent of the serious concern we all share at the continuing high level of unemployment in the Northern Region? Will he undertake to make representations to the President of the Board of Trade to ensure that the grant for machinery and plant is not reduced at the end of this year from 45 per cent. to 40 per cent., because this will surely reduce the employment opportunities in the region?

Mr. Fernyhough

My hon. Friend is only repeating what other hon. Members have said. Nobody could be more aware than I, because I represent Jarrow, of the need for more employment. I will certainly bring my hon. Friend's comment about investment grants to the attention of my right hon. Friend the President of the Board of Trade.

38. Mr. R. W. Elliott

asked the Secretary of State for Employment and Productivity if she is aware of the substantial fall in the number of persons employed in service industries in the Northern Region in the past year; and what investigation she has made to discover the causes of this fall.

Mr. Fernyhough

I am aware that the estimated number of employees in service industries in the Northern Region in June, 1967, was 4,700 less than in June, 1966, a difference of 0.8 per cent. No special investigation has been made. Decreases in some service industries were in part offset by increases in others.

Mr. Elliott

Is the hon. Gentleman aware that since June, 1967, there has been a continuing and ever-increasingly rapid fall in the number of people employed in service industries in the region? Is he aware that the region's great need is diversification of industry? Will he take fully into account the highly detrimental effect of Selective Employment Tax on development areas?

Mr. Fernyhough

I am aware that the July, 1966, measures had a serious effect upon service industries in the North, as they did throughout the country. I will certainly ensure that the attention of my right hon. Friend is drawn to that fact. We intend to relieve certain hotels in rural parts of development areas from the payment of S.E.T.

Mr. Tinn

Will my hon. Friend make strong representations to the Treasury for a favourable decision to the North-East on the siting of the P.A.Y.E. computer centre at an early date. This is urgently needed by the North-East.

Mr. Fernyhough

I am as interested in where that centre should be sited as is my hon. Friend.

Mr. John Page

Is the hon. Gentleman aware that he appears to be rather complacent in that he has given no reason for the decline in employment in service industries in the Northern Region and has said that he is not finding out anything about it? Will he ensure that the Secretary of State, who is not here this afternoon, is fully informed of the strong feelings which have been expressed from both sides of the House?

Mr. Fernyhough

I am not complacent. I have already said that my right hon. Friend the Chancellor has asked Mr. Reddaway to conduct an inquiry into the working of S.E.T. Mr. Reddaway will ascertain what its effects are, not only nationally, but in the Northern Region and in other development areas in particular.