HC Deb 03 November 1969 vol 790 cc787-800

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

Mr. Speaker

Mrs. Winifred Ewing.

10.16 p.m.

Mrs. Winifred Ewing (Hamilton)


Mr. William Hamilton (Fife, West)

The hon. Lady is a tartan Tory. She voted for the Tories.

Mrs. Ewing

I wish to address the House on the unsatisfactory state of statistical information relating to Scotland's economy and finances. Perhaps I should explain that this was not originally to be the subject of this debate. It was to have been concerned with party political broadcasting. However, I was told that that is a subject for which there is no Ministerial responsibility.

I once heard a Government Minister say, "All Government statistics are accurate, but some are more accurate than others". Before this debate is over, I hope to cast doubt on whether the phrase should not be reworded, "All Government statistics may not be accurate, and some are merely less inaccurate than others".

First, I direct a few general shafts at all Government statistics on which Scottish proportions may depend. I am in the fashion to be attacking statistics. Today, we spent 25 minutes on one statistic, with the Shadow Chancellor of the Exchequer casting doubt on the trade figures. We have also heard the right hon. Member for Kinross and West Perthshire (Sir Alec Douglas-Home) casting doubt on overseas spending. In a recent instance, the Polish Government put the Chancellor of the Exchequer right about external trade.

Scotland, as usual, suffers more than elsewhere on the statistical front. Unlike any other modern industrial nation, her vital statistics are shrouded in mystery or riddled with anomalies.

I indict the Government for sins of omission. There are no figures to tell us certain vital matters about Scotland's total exports, the flow of exports and imports between Scotland and England, Scotland's total consumer spending, Scotland's gross national product, or Scotland's cost of living index. It may not have escaped attention that I have been asking a number of Parliamentary Questions in an attempt to correct the Government's sins of omission and lead them down truthful and frank paths on these matters.

Since my election, I have pressed for a Scottish cost of living index. I have received promises, but no index. I was told that inter-departmental committees were being set up to look into "regional indices". Last week, I asked how many meetings those committees had had, and where. I was told that there was one meeting on 12th November, 1968, in London. They can hardly be accused of working overtime. Can that be a satisfactory way of dealing with a serious inquiry? Without a Scottish cost of living index, how can we know whether old age pensions in Scotland have sufficiently kept pace with the increase in the cost of living? I asked the question today, but I got an answer to a different question which I did not ask.

The signs of omission are serious if one wishes to measure the work or prospects of a nation, which is what I presume has been attempted recently in the budget for Scotland issued by the Treasury. It is necessary to fill in the gaps to correct the sins of omission if meaningful economic planning for Scotland is to be carried out.

I turn then to the sins of commission, and I do so under a number of headings which will be limited solely by the amount of time available to me. The first of my headings concerns the wage gap. The Scottish Office claims that wage levels in Scotland are getting closer to those in England, while P.A.Y.E. statistics show a trend the other way. The latest Inland Revenue reports for any three-year period show a widening of the gap. In the last three years of Conservative Government, from 1961–1964, the wage gap was LI 15s. 8d. a week. During the first three years of Labour Government, 1964 to 1967, the gap widened to £2 9s. 7d. per week. That is, the latest Inland Revenue statistics show an opposite trend. Where does the truth lie?

Secondly, emigration from Scotland. I have repeatedly asked for information about the gross emigration from Scotland and the categories divided into professional skills, etc. The net emigration figures are had enough: 1951–61 282,000, 1961–68 272,000, and 1968–69 upwards of 25,000, making a total of 579,000—more than half a million of our people gone since the 1950s. Why could not we find out the gross emigration? Could not some method of sample survey be used? That is a cheap method. It is not 100 per cent. accurate, but neither are Government statistics.

The Secretary of State's claim to publish the emigration figures is net only. He derives satisfaction from pointing out, quite rightly, that there was a decrease last year. But there was an increase in overseas emigration. This seems very crucial, because those who go overseas rarely come back, whereas we hope that those who go to England may come back.

It is essential to fill in a gap in the unemployment figures. The Government claim success at keeping unemployment under 100,000 in Scotland, which is less than the highest Tory peak of about 130,000. The Government figures, however, give a distorted impression, because they fail to include the number of people who emigrated. The numbers who have emigrated are keeping the unemployment figure at its present high level, but they are artificially keeping it lower than it would otherwise be.

It is important to look at the number in total employment, and I cannot let this opportunity pass without mentioning the shortfall of 105,000 jobs. That must De the highwater mark of how far out statistics can be. That was in the plan for expansion.

In my examination of various Ministries, along with other Members forming the Select Committee on Scottish Affairs, I have tried to find the culprit for that gross error in estimation, but I have not been able to find the culprit. No Government Department has ever accepted that responsibility. Perhaps the error lie; with the advisers to the Secretary of State for Scotland.

I turn to housing. The Government have a habit of giving the statistics for demolitions as if these were slum clearances. But a sizeable proportion of housing demolition one can almost be glad about in some respects, because it relates to planning work connected with roads, tunnels and work of this kind. It is gratifying that we are having some roads, but could we have the figures clarified?

The Cullingworth Report states that in 20 years from now there will be just as many slums in Scotland as there are now at the present rate of building.

Secondly, the Government have failed to relate their house building to international statistics. They seem happy to relate their statistics to the Tory performance. I do not see that the measure of the barometer of the Tory performance is satisfactory—

An Hon. Member

The hon. Lady has just voted with them.

Mrs. Ewing

I will ignore the intervention.

Mr. Archie Manuel (Central Ayrshire)

The hon. Lady is a Tory in disguise.

Mr. Deputy Speaker (Mr. Harry Gourlay)

Order. It is not customary to intervene in an Adjournment debate.

Mrs. Ewing

I turn to the long awaited budget for Scotland. We last had one in 1952–53. We have waited all these years to get another, and we got it, perhaps not coincidentally, on the eve of a by-election in Scotland. However, we gladly got it, even though it is riddled with both sins of omission and commission.

First, the presentation of the expenditure figures. Concerning agriculture and fisheries, Scotland is credited with 16.2 per cent. whereas our population share would be 9.7 per cent. But the Government are not taking into account that the subsidies are for the consumer and not the producer.

Secondly, housing. We are again told that we get more than our population proportion, namely, 20.4 per cent.— [Interruption.]—I will ignore the interruption. It will merely take time off the Minister's reply. It is up to hon. Gentlemen to decide what they wish to do.

We are told that we get 20.4 per cent. on housing, more than our population share. Scotland has a greater element of local authority housing, and England has a greater element of owner-occupied housing, yet tax rebates to mortgage holders are not included in the housing totals. This is a glaring omission, and if a correction is made for this one finds that the figures are substantially similar for the countries, and the question arises whether they should be so in view of the fact that housing in Scotland is still a great blot on all our consciences, and is a national disgrace.

Next, I deal with education, excluding universities. Here it is implied that Scotland gets three times her population share, yet the Scottish figures include expenditure on grants, a large item which appears under a different heading for England and Wales. If one removes this factor, one finds that central Government expenditure in Scotland and England and Wales is similar.

When dealing with education in universities, no allowance is made for the fact that one-fifth to one-quarter of Scottish university students are English. I do not object to that. It is good to have people coming to our universities, but allowance should be made for this so that statistics are not misleading. No mention is made of the fact that expenditure per full-time student is between £180 to £200 less in Scotland than in England and Wales.

A figure of 42.3 per cent. is shown for forestry, yet no mention is made of the fact that 60 per cent. of Forestry Commission land is in Scotland, nor of the fact that most forestry expenditure produces, or ought to produce, a long-term capital asset in terms of amenity, as well as improvements and ultimate prospects for industry.

For sickness and unemployment, we get more per head. Is this a matter for Government congratulation, or Government recrimination?

I put it to the House that this budget is a misleading document. I hope that it is not a fraudulent document. Statistics are difficult things, and one hopes that this document is merely misleading.

In a television broadcast the Financial Secretary to the Treasury implied that Scotland was subsidised by England. The hon. and learned Gentleman's claim cannot be substantiated, and I should like to explain why. The amount of subsidy claimed is £466 million, and I should like to look at that figure. First, a deduction has to be made in respect of loans to local authorities and nationalised industries, including public corporations. The figure given is £195 million. Loans are not grants. It is surely not necessary for anyone to instruct the Treasury on this simple fact. The Scots electors are a clever lot, and they know the difference between loans and grants. One has to be repaid, while the other does not. The Government are getting a high rate of interest on money lent, and to put this into the same category as a grant is misleading.

Second, income tax and corporation tax in respect of bodies outside Scotland. In April the Select Committee on Scottish Affairs cross-examined the Third Secretary to the Treasury, Mr. Vintner. In answer to a question he said that the difficulty of dividing Scottish revenue from that of the rest of Great Britain was potentially impossible and that if one takes a tax like corporation tax it is meaningless to divide payment for a particular corporation between England and Scotland, and in that regard we have the statement from the Treasury that it does not know the profits of such companies. In spite of that statement we have a token estimate. We have a token estimate of £10 million for income tax, and £15 million for corporation tax, making a total of £25 million, yet about 30 per cent. of Scots work for bodies or companies, including nationalised industries and tax offices, which have their head- quarters in London. Dividing that up, we find that about 12.5 per cent. work for nationalised industries, and 17 per cent. for companies. To insert a token figure for tax is therefore patently absurd.

The Goverment are at variance with the Financial Times, with the Scotsman, with Dr. Gavin McCrone the Government adviser to the Select Committee on Scottish affairs, and with the Scottish National Party. The Scotsman puts the Government figure as being out by £100 million, Dr. McCrone by about half that, and the Scottish National Party by £85 million, somewhere between the two. We take off £85 million. The balance left is now £186 million.

As for customs and excise, the Government have made two classic blunders. First, they used two different bases—a population over 15 and a straight per capita basis in the consumption of alcohol and tobacco. Secondly, they failed to allow for the fact that Scotland's consumption of alcohol includes more spirits and less beer in contrast to England. We allowed for bias under the first factor—the population. We then took two extremes, Scotland and England drinking the same proportion of beer and spirits per capita or alternatively, Scots consuming only spirits and English consuming only beer. Our conclusion was that the truth would lie approximately half way between. That means that another £36 million has to come off, leaving £150 million.

In defence, the Government created a basic confusion by implying that an independent Scotland would have the same expenditure on defence. They then contradicted themselves by admitting that aproximately £100 million to £150 million would be reasonable. On another point, it is a difficult question because the Treasury is chalking up a £222 million defence expenditure for Scotland, but in a Parliamentary Answer in December gave the answer—less £50 million. The Treasury budget starts with an erratum of £50 million, so perhaps one cannot be surprised at all these other matters.

My party's estimate, in accordance with other similarly sized and placed countries is £100 million—or it was in the year of this budget. I am afraid that we therefore have to take off another £122 million. This is what the Treasury admits in the document to be reasonable. I also indict the Government for failing to take into account the true comparison which should be made—which should be between Scotland and similarly sized and placed countries, and not between Scotland and Britain.

On allocated capital expenditure, we know that there must be various headings involved in the pursuit of the mirage of prestige and power, in which Scotland is not interested. Under this heading we have a mixed bag, including the Fl1ls, and enormous embassies abroad, which apparently we have to own for some reason. We are not prepared to regard it as reasonable that Scotland would be interested in such grandiose schemes or would attribute this to a Scottish budget, whichever party was running an independent Scotland.

Is it reasonable to charge Scotland with £111 million in debt interest? It is known that Scotland has not had a full share of the capital expenditure which created the debt. The example of £250 million recently written off London Transport's debts comes to mind, and the strange comparison with the Forth Road Bridge. Scottish Members should find these facts distasteful. The £111 million is perhaps the most unfair part of the budget. One can say that one must be thinking of a number here, to some extent, but we think that a very small figure would be fairer. We are prepared to take half the figure given. We estimate that after taking off the necessary £16 million in respect of allocated capital expenditure, the balance left is £12 million, and after reducing the debt interest by £56 million we are £44 million in the black.

Mr. William Hamilton

The hon. Lady should be on the London Palladium.

Mrs. Ewing

I am taking note of what the hon. Member said, and Scotland will take note of it, too.

In all this no allowance is made for the fact that wherever there is centralised Government a certain amount of money is bound to be spent where the Government is situated. A huge proportion of my salary is spent in London, not by any wish of mine. There are numerous other examples of persons in this kind of position. There are the assets—[HON. MEMBERS : "Too long ; give the Minister time ".] Hon. Members have taken five minutes of my time with interruptions. The assets of Scotland's financial institutions amount to £7,000 million. [Interruption.] I find it difficult to concentrate. I am trying to help the House by getting on, as hon. Members will appreciate from the speed at which I am speaking.

Another wealth indicator which has not been included is the attitude of the people. It is strange that this should be excluded, because the Prime Minister is always reminding us that economic success depends not on material resources, but on the purposiveness and resolute will of the people, and I agree with the Prime Minister about that.

The present Government have produced more statistics than any other. That is the only bouquet which I can throw at the Government Front Bench. throw at the Government Front Bench. criticise specifically the basis of the Government's statistics. How can we have economic planning without the basic statistics? To attempt to do so makes no sense to any logical person or politician or economist.

The proposition that the Government are suggesting to the Scottish electors, that they are parasites, when they know that they are paying for everything they get is a double insult. It is insulting in itself, but it is also insulting—

Mr. Manuel

The hon. Lady is a parasite for drawing her salary for doing nothing.

Mrs. Ewing

I regard that as an insulting remark which is unworthy of the House, but typical of much of the treatment I have received from many hon. Members since I took my seat. It was a most insulting remark and I am not prepared to accept it. This is just abusing the time of the House. I will sit down in order to give the hon. Member a chance to apologise.

Mr. Deputy Speaker

Dr. Mabon.

Mrs. Ewing

I have not concluded my speech. I sat down to give the hon. Member a chance to apologise.

The Minister of State, Scottish Office (Dr. J. Dickson Mabon)

I have less than eight minutes now.

Mrs. Ewing

I am sorry ; I have done my best—

Mr. Deputy Speaker

In an Adjournment debate it is customary for the Minister to be left ample time in which to reply. While the hon. Lady has been interrupted on one or two occasions, the amount of material she has put before the House has taken longer than is customary.

Mrs. Ewing

I am sorry, but I was distracted. I understand that it is the custom not to interrupt an hon. Member during an Adjournment debate, but that custom has not been observed tonight.

I was saying that it is a double insult to suggest that Scotland is a parasite nation and that Scots will be influenced into changing their thinking so that they are glad to put their hands out for the hand-outs. The true reaction of the Scots is that this is not just a bread and butter cause, but that they want to run their own affairs at the earliest opportunity.

10.38 p.m.

The Minister of State, Scottish Office (Dr. J. Dickson Mabon)

None of us thinks that because the figures in the budget are what they are that Scotland is thereby to be inferred to be a parasitic country. Our country needs substantial investment both on social and economic grounds. It is not on the basis of Goschen or anything else that that investment should be given. It is right that the Scots should be developed as any other people in these islands and that the same high standards of living should be enjoyed in all parts of the country. I do not accept the view that because we have high investment, we are a parasitic people, nor the absurd claim that we can pretend that we give a lot to the English. That is nonsense, as has been demonstrated quite well in the budget which the Treasury has produced.

I cannot deal with everything in the six minutes which the hon. Lady the Member for Hamilton (Mrs. Ewing) has left to me, and so I will answer only a few points. I accept her bouquet that we have produced more statistics than ever before. That has been our constant endeavour. To be fair to our predecessors, they, too, have sought to add to the statistics. We have more statistics about and more knowledge of Scotland than of any other part of the British Isles, with the exception of Northern Ireland. Northern Ireland has a customs frontier with Southern Ireland and is separated from the United Kingdom by the sea. These physical and political facts explain why Northern Ireland is able to have more statistics than we have.

I should like to deal with some of the points made by the hon. Lady the Member for Hamilton in her Alice-in-Wonderland arithmetic in which £192 million was thrown out of the window, followed by another £120 million and so on until she ended with the proud boast that we were £44 million in the red—[HON. MEMBERS : "In the black."]—in the black—even more staggering.

The hon. Lady said that loans should be excluded from the budget, but how- ever one finances investment, it is a charge on currently produced resources and must be matched by savings, either in Scotland or elsewhere in the United Kingdom. No serious commentator outside the hon. Lady's party has challenged the point that lending of this kind must be included in any comprehensive budget for Scottish revenue and expenditure.

She went on to say rightly that loans are not grants. On the other hand, loans bear interest and that interest is credited to the Scottish budget. Lines 17 to 19 of the relevant page of the Treasury Report point out that £83 million is in the form of interest on loans. Loans must be repaid and those repayments are deducted from the net lending figures debited to Scotland and that is made clear in lines 31 to 35. Let us conduct this debate on a rational basis. I trust that the hon. Lady will, on reflection, appreciate the position and put back the £195 million which, earlier in her remarks, she managed to dump.

It is on the question of defence that the hon. Lady and her party make another false argument, although I give her credit for changing her mind on this subject. Although the hon. Lady said that her party's estimate on this score was £100 million, only three weeks ago the Chairman of the Scottish Nationalist Party published an estimate of £152 million ; and a difference of £52 million in only three weeks is not bad.

However, her party's estimate was related to defence expenditure in Scotland and not for Scotland. As we know, a large part of defence expenditure unfortunately occurs overseas, but this is inevitable—that is, unless one were prepared to decide that one should not spend anything outside Scotland in defence of Scotland. Thus, before the hon. Lady can make such a deduction on this point, she has an assumption which must be proven, and it is up to her to prove it.

When discussing the question of debt interest, the hon. Lady considers that £111 million is not the figure and that it should be more or less halved to about £56 million. However, on 9th October the chairman of her party thought it should be £66 million ; but that is a mere £10 million different, we need not bother too much with it. The hon. Lady put forward no evidence for her claim on the question of debt interest.

The hon. Lady will, I am sure, not disagree that we in Scotland are now getting a fair share of total investment—not a per capita share but a fair share according to our needs and not according to our people, and these needs are, proportionately, higher than our total number of people. If she is to be listened to, the hon. Lady must prove that there has always been a less than per capita investment in Scotland ; in other words, that in early Victorian times the Liberals and Tories never maintained capital investment on a proportionate basis. It is not for the Treasury but for her to prove that, or to try to do so, and she will have a job doing so at the drop of the delicate and rather sartorial hat that she is wearing.

Like me, the hon. Lady pays her income tax to Cardiff, because she is an hon. Member, but many London workers make their income tax payments in Scotland. Indeed, twice the number of public sector staff in England and Wales are paying their income tax through Scottish offices than there are Scottish public sector workers paying their income tax through offices outside Scotland. If the hon. Lady doubts this, she can confirm it from the Treasury's Report. Indeed, we approached a number of firms and asked them questions about the payment of income tax. We were surprised to learn of the large number of firms which pay their employees in Scotland.

Then consider the question of whisky, a beverage which I much enjoy. The hon. Lady estimated the duty on beer and whisky as a fascinating exercise into higher absurdities. First she made the assumption that the Scots and English drink the same amount. Then she said that the Scots drink all the whisky and the English all the beer. But since, unfortunately, there are 10 times more English and Welsh than Scots, one must agree that "Facts are chiels that winna ding".

However, she went on to speak of what she called the "middle balance ", and somehow worked out that the Scots drink 55 per cent. of all whisky produced in Scotland. If that, in the view of her party, is what should happen, and if that is their general policy, then we and the Tories must surely lose. She may think this to be a very good argument to have as part of S.N.P. policy, but it is fundamentally wrong and the House cannot put up with it.

Question put and agreed to.

Adjourned accordingly at a quarter to Eleven o'clock.