HC Deb 14 October 1968 vol 770 cc163-72

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

10.0 p.m.

Mr. Arthur Blenkinsop (South Shields) I am very glad indeed to have this opportunity on the first day the House resumes after the Summer Recess to raise one of the most urgent matters affecting my own constituency, namely, that of the employment prospects of the area. I am particularly pleased that my hon. Friend is to reply, because his constituency and mine adjoin each other, and he is extremely well aware of the situation in our area and will be well conversant with the points which I wish to raise.

I think he will be the first to agree that when we face the situation, as we do as this moment, in which I have in my constituency of South Shields some 2,896 people out of work including some 2,360 men—alas, some 300 more than were out of work a year ago—then it is natural and right that one should raise in this House, seizing the first opportunity of an Adjournment debate, the whole question of the prospects of employment for them, and others who are obviously immediately affected. As I am sure my hon. Friend knows very well, the fact is that nearly 10 per cent. of the insured male population in South Shields are out of work. This is a very serious figure indeed. I quite agree, and immediately state the fact, that some 540 of those who are unemployed have been unemployed only a very short time—not more than two weeks—and we have every hope that a large number of these, and others, will be back in employment very quickly. This is so, but I have also to state the fact—and it is a very unwelcome one—that there are approximately 1,000 men and women who have been out of work for three months or more, and alas, there are quite a number of young people who have been out of work for as long. These are very serious facts indeed for all of us, and certainly something which none of us on this side of the House, or, indeed, I am prepared to believe, on the other, will be prepared to accept.

Two of our main anxieties are that we are still uncertain about the future of pit closures. We have suffered already in this part of County Durham, as in other parts, from pit closures, and there are quite a considerable number of ex-miners on the unemployment registers. One of the most worrying features is that not only are we anxious about the future of the pits but we have also recently become anxious about the position of one of our most famous and, we believe, one of our most efficient engineering works, on which a very large number of my hon. Friends' constituents and mine rely, namely, Reyrolle's, one of the biggest engineering works in the North. The unhappy fact is that at this precise moment quite a number of men are being given their redundancy notices at those works.

We might be prepared to face and understand the situation of the mines and the changes which are inevitable in our fuel industries, but we had every expectation that great engineering industries would be encouraged by recent developments, including devaluation and so on, and it is, therefore, a very bitter blow indeed that in one of the best of our engineering works this spectre of unemployment is emerging.

There is not much doubt that the main cause has been the slowdown of the investment programme of the Central Electricity Generating Board. There is no doubt, either, that a great deal of the work of the firm has been linked with the Board. I know of, and I welcome, the action which my hon. Friend has been taking to put matters right, and I hope that he may be able to say something further this evening. This is one cloud which hangs over our district and which makes us particularly anxious.

There are, of course, more encouraging factors. I welcome the amazing change in the situation in our shipbuilding industry, the credit for which lies very largely with the Government in the action that they have taken. Only a short time ago we were concerned about the situation in shipbuilding; today, there has been a flood of new orders, and there is every hope that the industry will have a full order book for some years to come, providing that management and trade unions can work out a more sane and more effective system of working. Whether or not we can, I do not know; we desperately hope that we can. Certainly, the threats of strikes in the engineering industry do not help, and we know that already some work has been lost from this cause. It is a tragedy that strikes should be necessary.

There are better prospects in the shipbuilding industry, new firms, such as Plesseys, have come into my constituency, bringing new work, and we hope that very shortly they will be able to expand. These developments and others further afield in the North-East which have brought in new work have not overcome the tragic reality of the unemployment that we still face, and, therefore, further action is required, further action, above all, to avoid a build-up of unemployment during this winter.

There are four points that I wish to put to my hon. Friend. First, we are not doing anything like enough to clear the relics of dereliction in our area. Quite a lot has been done. The Government offer a grant of 85 per cent. to local authorities to assist in this work, but I believe that we need a national campaign against the derelict areas and that the 85 per cent. grant is not enough. The Government need to accept full responsibility for this campaign. Now is the time for it to be carried out, since there is available machinery of the Open-Cast Executive of the National Coal Board which is just the machinery that is needed to do this work.

As my hon. Friend will know, the Opencast Executive is having to reduce its activities and, therefore, machinery is available which might become dispersed unless we step in quickly and take advantage of it. Therefore, I urge him to impress upon his right hon. and hon. Friends that now is the moment to use machinery at present lying idle to transform some parts of our area which are still a bad advertisement for us.

Secondly, although something has been done to try to use the purchasing power of Government Departments and the nationalised industries to channel orders more effectively into the development areas, I do not think that it has been adequately used. I would be glad to know from my hon. Friend whether anything further can be done to bring to the attention of the different Ministries and nationalised industries the effective use of their existing Powers. Cases have been quoted in which highly reputable firms and branches of national undertakings in the North-East have been denied orders from nationalised industries which should have been placed in the area.

Thirdly, I would suggest doing what was done last winter, when local authorities were encouraged to bring forward orders which would have been placed in any case and to bring forward work which in any case would have been carried out. We should get our local authorities to speed up improvements to schools, road works and works in connection with housing, welfare and health which are being prepared already, the details of which are known, and which are being held back for sanction and approval. Cannot some of them be brought forward to make sure that those who are out of work can be employed again? Surely it is better to spend a little more on those works and spend less on unemployment benefit.

Finally, I would raise again the wider question of the application of S.E.T. in relation to areas like my own and, more particularly, in relation to distributive industry which is clearly linked with productive industry. There is a case to be made out for the refund of the tax in development areas, possibly in selected cases where the link between distributive and productive industry is quite clear.

Those are four practical points on which I believe we could act straight away. I am sure that my hon. Friend agrees that these figures of unemployment disclose what is a serious waste of resources and that we should make sure that every possible element of effective use is made of the manpower and woman power which these tragic figures show is not being utilised fully at the moment

I hope very much that my hon. Friend will take this early opportunity to give some encouragement and hope to those who are out of work and, at the same time, encourage those of us who are determined to see that our area gets ahead in its redevelopment, which I am sure that my hon. Friend is equally anxious to see.

10.15 p.m.

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

I share the worries and anxieties of my hon. Friend the Member for South Shields (Mr. Blenkinsop) about the unemployment position in both his and my constituency. My hon. Friend said that the numbers had increased and were now 300 higher than 12 months ago. I know that and I am sorry that it is so, but my hon. Friend knows that that increase is due primarily to the closing of collieries at Whitburn and Washington F and the voluntary early retirements which have taken place at Harton and Westoe, those four cases together making a total of 700 lost jobs. Whilst I readily accept that the majority of those 700 suffer the indignity of being unemployed, they are nevertheless benefiting from the National Coal Board's supplementary income scheme. For the rest, redundancy payments and wage-related benefits have done something to cushion the hardship which otherwise would have been greater.

I was glad to hear my hon. Friend's tribute to what we have been able to do in the shipbuilding industry. There is no doubt that the Tyne in general can never be prosperous, unless the shipbuilding industry is not merely holding its owns but is going ahead. I think my hon. Friend will accept that the change in the prospects in the shipbuilding industry is revolutionary compared with the situation 18 months ago. The yard at South Shields has benefited as much from the consortium's better prospects as any yard associated with the consortium. My hon. Friend mentioned that it was unfortunate that some workers were already being laid off because of the threatened strike. It is a tragedy that certain repair jobs which would have provided work for several hundred men have, because of the uncertainty brought about by the possibility of a strike, been lost to yards where our constituents work.

My hon. Friend was anxious to know about additional employment prospects. I will start with one of the major new firms, Plessey, which has gone there. Plessey expects to double its production over the next two years. This will mean an increase in its labour force of 600 men and 700 women.

Burndept—Vidor, which was recently taken over by Crompton Parkinson, is not only to increase its production, but will take on additional labour, some 70-odd jobs, half of which will be for men.

Be Modern Fireplaces, which has recently taken over new premises, will take on an additional 60 workers.

British Oxygen, which is already established in the area, is moving its present factory from Morden in Suriey to South Shields, and this will provide an additional 200 jobs.

Mr. Blenkinsop

Can my hon. Friend give me any idea when this British Oxygen move is to take place?

Mr. Fernyhough

It is a firm decision and I think that the move will take place very shortly. This will mean that its labour force will build up to 500, and this should happen in a relatively short time.

My hon. Friend referred to Reyrolle's. There is no need to tell him how important this firm is to me. I always look on it as the bread and butter of my constituency. At its works at Hebburn it employs as many people as are employed by the whole of the Tyneside shipbuilding consortium, so no one can doubt how important it is to the prosperity of my constituency in particular, and Tyneside in general.

The problem facing Reyrolle's is that the detrand for switch gear has dropped by a terrific margin, and is only about 20 per cent. of what it was a few years ago. Since Reyrolle's has to a large extent depended on the C.E.G.B., which at the moment is not giving out contracts to the extent that it once was, it means that the firm is passing through a difficult phase.

No firm of which I know is trying to carry out the distasteful task of having to declare workers redundant in a more humanitarian way than this firm is, and no firm of which I know has been more concerned to see that there is adequate consultation with the trade unions and the workers affected. It is carrying out a redundancy policy in an exemplary manner—if one can ever talk about redundancy being carried out in that way—and I wish other firms would pay the same regard to their workers' interests and feelings as this firm is doing in trying to carry out this job.

According to present information, by the end of the year most of the redundancies will occur amongst office workers. There may be others who will become redundant, but that is where the biggest proportion is likely to be. The firm is trying to soften the blow by getting men over 60 and women over 55 to accept retirement, and my latest information is that by negotiation and agreement with the trade unions the firm is supplementing the redundancy payments which are due under the Government's schemes.

I cannot at the moment say anything more about Reyrolle's. I know that my hon. Friend will accept it from me that I am anxious to, and am doing as much as I can to see that additional work is given to the firm. My hon. Friend knows that Reyrolle's is part of the nuclear power group in the North, and that it has been awarded the £87½ million Hunterstone contract. My hon. Friend knows, too, that Reyrolle's and Parsons are now partners, and that Parsons have part of the smelter contract. Last week this firm was successful in getting a contract from Portugal. I hope that this firm, which has a good export record, will be successful in its endeavour to find, in the export market, orders to supplement the work that it has lost in the home market.

My hon. Friend has referred to clearance areas. I know how great is his interest in them. It is not my field, but I can tell him what is happening in the North-East. The Ministry of Housing and Local Government has asked local authorities for three-year programmes for the clearance of derelict land. Although these have not yet all been received, those for the Northern Region are now to hand. These show that in South Shields there are three sites to be reclaimed, comprising 50 acres. It is expected that these will be reclaimed during 1968–69 and 1969–70, and the estimated cost of the reclamation is £158,000. The three sites are Middle Fields A, Middle Fields B, and Dyston Street, Station Road. In addition—because my hon. Friend referred to the North-East in general—Durham County Council has a programme providing for the expenditure of about £2,900,000 in the next three years; the Northumberland County Council envisages a reclamation programme at a cost of £300,000 a year, and the Cumberland County Council is considering a five-year programme costing £815,000 a year.

I know that my hon. Friend feels that this is such an urgent and great task that it should be handed to the Coal Board's open cast department, but this is not easy. At a time when we are saying that local authorities should have more power, they would resent our taking away their right in this matter. I know that my hon. Friend has raised this question with my right hon. Friend the Minister of Housing and Local Government, and I have no doubt that what is said in this debate will be read, but at the moment my right hon. Friend is reluctant in any way to offend local authorities, and in any case this would require further legislation.

My hon. Friend asked whether there could be a crash programme this winter as we had last winter. I will see that his views on the matter are brought to the attention of those who will have to make a decision. The Government have decided that certain local authorities with special social needs should have special help, and South Shields is one of 34 authorities which will qualify over the next 18 months for additional financial aid to deal with overcrowding, persistent unemployment, large families, children in trouble, and so on.

My hon. Friend also asked whether it would be possible for S.E.T. to be refunded in respect of service workers in development areas. As he knows, the Chancellor has asked Mr. Reddaway to look into the effects of the tax. I am not in a position to give a "Yes" or "No" to his plea, and it is not likely that the Chancellor would make any statement pending the report from Mr. Reddaway on the effects of S.E.T. in general.

My hon. Friend has been in this House as long as I have. In the 20 years or so that we have been here neither of us has known the joy of representing constituencies with full employment. We have always had this cross to carry. Like him, I am anxious to get rid of this cross as quickly as I can, because I know that my political life will be a little easier and my sleep the sounder if I do not have this problem constantly with me.

To show that the Government are determined to help areas such as the North-East I should like to quote some figures. Last year the North-East received 8.8 per cent. of all the development certificates, but they represented 15.8 per cent. of the jobs which would become available as the result of those certificates. Last year, out of total investment grants made by the Board of Trade of £480 million, the North received £70 million. On a population basis, in both cases the North-East received far more than its share.

In addition, the Government have pursued a policy of moving Government offices out of the Metropolis into the development areas. We have a pensions branch at which—

The Question having been proposed at Ten o'clock and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at half-past Ten o'clock.