NORTHERN REGION (ECONOMIC DEVELOPMENT)

HC Deb 23 February 1970 vol 796 cc831-94

4.3 p.m.

Mr. Gordon A. T. Bagier (Sunderland, South)

I beg to move, That this House takes note of the grave threat to the interests of the northern development area arising from the Tory shadow cabinet's proposals at its Selsdon Park meeting; and congratulates the Government for pursuing policies aimed at assisting the Northern development area to recover from the effects of the changing pattern of industry, and the years of neglect under the previous Tory governments.

Mr. Speaker

I wish to inform the House at this stage, in case I am not in the Chair when the hon. Member for Sunderland, South (Mr. Bagier) has completed his speech, that I have not selected the Amendment standing in the names of the hon. Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) and the hon. Lady the Member for Tynemouth (Dame Irene Ward), namely, in line 2, leave out from 'House' to end and add: 'considers that no distortions should distract attention from the fact that Government policies for the North-East have failed, that large sums of taxpayers' money are, as supporters of the Government publicly acknowledge, being wasted with no increase in jobs, and that the North-East has the highest unemployment in Great Britain'.

Mr. Bagier

I will try to make it clear that my hon. Friends and I who represent Northern constituencies are not, despite the terms of the Motion, entirely satisfied with the situation at the present time. There is still very high unemployment in the North and this has been the main festering sore with which we have had to contend for a long time. Later in my speech I shall make what I hope will be regarded as some constructive suggestions, but, first, I wish to identify the size of the problem.

It has been estimated by the Northern Economic Planning Council that by 1981 the total of jobs lost since 1966 in the region's basic industries of coal, steel, shipbuilding and marine engineering will have been about 150,000, mainly male. This is an extremely serious and hard problem to solve.

I wish to make it clear at the outset that this problem would have been much easier to solve had it been identified 10 or 15 years ago. Indeed, it is fair to say, as the terms of the Motion make clear, that there were years of neglect under previous Administrations when action could and should have been taken to foresee the problem and adopt steps to alleviate it.

By identifying the problems of the so-called grey areas the Labour Administration are appreciating the sort of difficulties that these areas will be facing in five, 10 or 15 years' time, in addition to the problems which they are facing today. Had hon. Gentlemen opposite done this when they were responsible—between 1951 and 1964—the predicament would not now be as severe as it is.

Unemployment in the Northern Region is very high. Like hon. Gentlemen generally, I have been pleased to see a slight downturn this month, and this has probably come about because of the policies which Labour has been pursuing. Considering the tremendous amount of capital investment that has been made in the region—far more than anything achieved under the Tories—there must have been some effect resulting from Labour's policies.

Nevertheless, in January, 1970, the Northern Region had a rate of unemployment of 5.2 per cent., representing a total of 67,900 persons registered as unemployed, an extremely high figure. Particularly worrying is the fact that 3,600 young persons were unemployed last month, almost 500 more than last year. Bearing these figures in mind, it is reasonable to make comparisons with what occurred under previous Administrations. For example, in 1963 there were 9,600 youngsters out of work—that after 12 years of Tory rule.

Sir Keith Joseph (Leeds, North-East)

In which month of 1963?

Mr. Bagier

Which month indeed!

Sir K. Joseph

If the hon. Gentleman and his colleagues will refrain from quoting figures for February, 1963—that was the most severe winter of the century —I and my hon. Friends will undertake to refrain from quoting figures for 1947, the year of the fuel crisis.

Mr. Bagier

Is the right hon. Gentleman seriously suggesting that bad weather made a difference between 3,600 and 9,300 youngsters unemployed?

Sir K. Joseph

Yes.

Mr. Bagier

That is typical of the approach of hon. Gentlemen opposite. That is why we have this problem after 13 years of Tory rule. The figures are disturbing and I assure the right hon. Gentleman that I will be among the first to analyse them and to compare the policies pursued by the Tories with the policies which we have been pursuing.

In considering this whole problem we must examine how the Government can be of assistance. In 1963 or 1964 the right hon. Member for Leeds, North-East (Sir K. Joseph) said, in effect, "Labour hon. Members talk about bringing in Government industry, but to produce what and for what market?" My hon. Friends were in opposition at the time. I remind the right hon. Gentleman that the Labour Government have not been doing too bad a job when we consider how they have encouraged private enterprise to establish the Alcan smelter.

They have not done a bad job in bringing Government offices from the centre. New Government offices since the beginning of 1966 in the Northern Region include the Board of Trade Investment Grants Office at Billingham; the Department of Education and Science teachers' salaries and pension office at Darlington: the Ministry of Social Security Staff Training Centre at Billingham; and Her Majesty's Stationery Office factory for printing telephone directories, at the Team Valley Trading Estate, which means 400 jobs by the mid-1970s, mostly males.

There is the Inland Revenue Computer Centre at Washington, which will mean 3,000 jobs by the mid-1970s. The National Savings Save As You Earn Department at Durham will provide several hundred jobs. That is not a bad record for a Goverment who have been in office for only a short period of years; and I have forgotten to mention the Land Commission headquarters at Newcastle. [Laughter.] The hon. Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) laughs. Perhaps he does not agree that there should be a Land Commission headquarters at all.

The hon. Member should refer to his right hon. Friend the Member for Leeds, North-East, who seems to have been in two minds on this. On 18th July, 1960, he said that such a scheme would be financially unsound and would make the State a huge landlord. He added: I do not believe … that that would be acceptable to the public."—[OFFICIAL REPORT, 18th July, 1960; Vol. 627, c. 161.] But that was just after a General Election. What did he say in 1963, just prior to an election? He said on 18th November, speaking as Minister of Housing, that it seemed right that the increase in land value as a result of public expenditure should be collected by the public. He went on: It is a corollary of regional planning and development that land planned for major development should be bought well in advance by a public authority for disposal to private enterprise or to public enterprise as required, both to control and phase the development and to help in meeting the cost of bringing it into development. We may well have to devise new machinery for the purpose."—[OFFICIAL REPORT, 18th November, 1963; Vol. 684, c. 656.] I hope that the right hon. Gentleman's later statement is one that he will stick to and that he will be satisfied that we have a Land Commission headquarters in the North-East.

I hope that there is no argument about public investment with hon. Members opposite. In the North-East it has risen from £83 million in 1965–66, or 7.1 per cent., to £160.6 million in 1968–69. This is an increase of 93 per cent. in investment in the Northern Region, by far the fastest rate of increase of any region in Great Britain.

Housing accounted for about one-third of such investment. We shall have to watch this figure in the North now. We shall have to watch just how much it drops, as it may well do. When one examines some of the figures for house building in the region, one is alarmed. Take my own local authority of Sunderland as an example. The hon. Member for Worcester (Mr. Peter Walker) said recently that many Conservative chairmen seemed to be trying to emulate their Labour predecessors in building more houses.

I will exonerate Sunderland from that. It has dropped its house-building programme from 1,400 a year to 100. If the burgomasters of Sunderland want to come to my "surgery" any time and hear my constituents begging for houses, they are welcome. It is no good their saying for one moment that the housing problem has been solved. It is far from that.

As regards home ownership, only within the past two or three weeks the Sunderland Council has admitted that it played about with an offer of £150,000 towards mortgage grants. It was only through the persistence of the leader of the oppositions' party, the Labour leader on the council, that it came to light that the council had been playing about with it since September, when the recommendation was that the offer should not be taken up. That is from the party which believes in home ownership. Many old properties in Sunderland with long periods of life ahead of them could well have been the subject of a mortgage under that scheme.

When the Tory local authority starts to judge whether my constituents can afford the current rates of interest on mortgages, it is a precious nerve, certainly when the matter was not brought before the council until it was forced to. At this month's council' meeting the decision was reversed owing to the persistence of my Labour colleagues, but this has left only a few weeks before the end of the financial year in which the £150,000 can be taken up.

It is remarkable that when we have debates, as we had the other week, about the size of the housing programme, we cannot take into consideration the activities of local authorities like that. It seems a strange situation, far removed from what went on in the years of Labour councils and Tory government, when council after council came to see Tory Ministers begging for loan sanctions to increase their house-building programme. We have exactly the reverse situation where housing Ministers are having to write to local authorities and ask them to analyse their housing situation to see why they are not building the number of houses they should.

The only mistake made by my right hon. Friend the Minister of Housing was to address the letter to the mayor. The mayor of my authority thought that it was a personal letter, because she did not even bother to report it to the full council. I had to ask my right hon. Friend in the House whether it was a personal letter or one which should be given the council's judgment.

The situation in Sunderland is quite serious. We have the town clerk reported in a newspaper as saying: We have noted what the Minister said and we trust that these assurances are not just pious hopes. The fact remains that unless more is done in the way of direct aid, Sunderland will indeed suffer to the extent I forecast in the statement I made to the Minister. The report continued: Last night, pointing to Sunderland's 'very serious unemployment problem' of 6,000 workless, Mr. Storey had told the Minister: 'We believe that given equal terms with others we can go a long way to solving it, but we cannot progress far if we have to fight the Government, and this is just what we are having to do'. The only difference is that that was said by the town clerk to the present Leader of the Opposition in 1964, after 13 years of Tory government. This was the essence of their planning, when reference was made to the tremendous difficulties of Sunderland then. So it is an appalling cheek that our Government after only a short period in office should be attacked so much by right hon. and hon. Gentlemen opposite.

We have peculiar problems, peculiar, I suppose, to development districts, in as much as we have had a tremendous rundown in the more basic industries. We have had a rundown in the coal mining, shipbuilding and engineering industries of the figure to which I referred.

There are two ways in which we can solve the problem. We can attract new technologically-based industries into the area, and we can train the necessary staff. We can also provide factory space in which they can operate. Here, the Government have a credit mark. There are now in the Northern Region 76 advance factories planned or built. When the party opposite was in office, from 1951 to 1959, not one advance factory was planned or built. When the regional Rip van Winkles finally woke up and produced their 1960 Local Government Act, with provision for advance factories, they steamed ahead and up to 1964 had produced 16. Since we came to office in 1964, 60 advance factories have been planned for the region.

We have 45 advance factories allocated, 16 under construction, three completed but unlet, and nine yet to start building. We are prepared to provide the hardware, the money, the incentive, the investment grants, the training grants—all that is available—assuming that we can get industry to the area. The present Government have been doing a fairly hectic job of planning, which is in stark contrast to what went on during 13 years of Tory administration.

In the debate on unemployment on 3rd February the hon. Member for New-castle-upon-Tyne referred, quite rightly, to training. Training presents a very big problem. The hon. Gentleman quoted a figure of 52,000 unemployed, of whom only 8,000 were registered as craftsmen. It is extremely difficult overnight to plan the training of men who have for many years been in other industries but, again, the number of training centres which have been made available under the present Government makes a stark contrast to the performance of the previous Government, and from it one is able to judge the actions of the party opposite when in office and when in opposition.

Between 1951 and 1959 training at Government centres virtually ceased, and during that period right hon. and hon. Gentlemen opposite were closing training centres. In the end, there were provided in the North-East only 80 places—

Mr. R. W. Elliott (Newcastle-upon-Tyne, North)

Why?

Mr. Bagier

The hon. Gentleman asks "Why?". One reason was that the Tories mistakenly and foolishly, and typically, thought that because unemployment had fallen retraining was no longer needed. Such thinking shows how much they misunderstand how retraining ought to be done.

The hon. Gentleman has said that there was trade union resistance. When there is widespread unemployment there is a tendency towards trade union resistance, because it is natural, in such circumstances, that the trade unions should be thinking more in terms of protecting their unemployed craftsmen than taking in men from Government training centres. That means that a period of near full employment was the time when the planning of training should have taken place; a time when it was obvious that there would be a rundown in coal mining, rationalisation in shipbuilding, and so on. Hon. and right hon. Members opposite did not foresee this. As a result, the North-East was left with 80 places, at the Felling Training Centre.

The present position is that we have a potential in the Northern Region training centres at Felling, Tursdale, Billing- ham, Killingworth and Maryport of 2,000 trainees per annum. The new Durham G.T.C. started in November, and Tursdale was closed last month, the trainees there being transferred to Durham. When Darlington opens we shall have an annual potential of between 2,500 and 2,800 trainees. A new centre will probably be opened at Middlesbrough in April, 1971, when the potential annual output of trainees in the region will be about 3,000.

This amply underlines the fact that the Government are prepared to get to grips with the problem and to understand it. They are prepared to provide £10 a week for each individual trainee if industry is brought in. They are prepared to examine the real problems involved in asking the trade unions for their help—help that has been given, be it noted, on most occasions—in taking in trainees on their return to industry.

What worries me is what would happen in the unlikely event of the Opposition being returned to power. What worries me, and this is why I have included it in my Motion, is what would happen in the region as a result of the Selsdon Park proposals. I hope that the right hon. Gentleman the Member for Leeds, North-East will enlarge somewhat on what he sees his proposals doing in the North-East. Most of us can only go by newspaper reports, and it is reported that there will be a quick phasing out of the regional employment premium—

Sir K. Joseph

Phased.

Mr. Bagier

We are told that it is to be phased out. Perhaps the right hon. Gentleman will tell us what he means by phasing out, and what thinks should replace the premium.

We hear reports that the party opposite intends to replace investment grant—

Mr. W. E. Garrett (Wallsend)

If any.

Mr. Bagier

If any, as my hon. Friend the Member for Wallsend (Mr. Garrett) says. The Opposition have not been known for philanthropy when in power.

But the right hon. Gentleman must be careful, because if he puts forward these proposals without taking notice of their effects on industry there may be some backlash. For instance, some of us are worried, and so are some of the right hon. Gentleman's supporters, about how this R.E.P. proposal would affect, for example, the shipbuilding industry. If R.E.P. is to be phased out, we will be interested to know how it will affect a firm like Swan Hunter, which, last year, showed profits of £1.6 million, of which £1.5 million were accounted for by R.E.P.

It may well be argued that we should not provide profits for shipbuilders, but I know just how competitive the shipbuilding business is, and how hard the firms have worked—under this Government's guidance—to get orders. What they have done is to their credit.

I recall the policy of the party opposite, when the right hon. Gentleman the Member for Wallasey (Mr. Marples) provided £70 million worth of credit for the shipbuilding industry without any strings being attached, or any condition made about those in the industry making themselves efficient. It was a palliative, and one which I am proud to say my constituency gobbled up to the extent of 40 per cent.

It has been the present Government which have implemented the Geddes Report, which have produced the Shipbuilding Industry Board and put the industry in a position to compete throughout the world. It was the present Government which provided the wherewithal by means of which Wearside has launched more tonnage than ever before in its history. The Government have appreciated the problem.

The right hon. Gentleman may shake his head, but I remind the House once more that when the right hon. Member for Wallasey provided that £70 million it was taken as a gift, and the shipbuilding industry did nothing to bring about some measure of efficiency—

Sir K. Joseph

I think that the shipbuilders themselves would say that the biggest contributions to their welcome success have been devaluation and a world shipping boom.

Mr. Bagier

It is a tripartite thing. The industry would probably be rather more honest, and admit that the credit made available by this Government has also been of great help—

Mr. Geoffrey Rhodes (Newcastle-upon-Tyne, East)

Would not my right hon. Friend agree that if what the right hon. Gentleman the Member for Leeds, North-East (Sir K. Joseph) has said were true, the Swan Hunter shipbuilding firm would have been out of business without the two things he has mentioned?

Mr. Bagier

That is true. I could also mention that some of the larger firms—Clarke Chapman, Davy-Ashmore, Reyrolle Parsons, Cammell Laird, Head-Wrightson, Swan Hunter and Vickers—also made profits inclusive of R.E.P. which will, by giving them the ability to plough money back into investment, affect their competitiveness. Perhaps I should warn the right hon. Gentleman that contributions like the £4,000 made by Reycolle Parsons towards his party's funds may dry up if he gets too naughty in that direction.

Mr. Rhodes

It is a very bad investment, anyway.

Mr. Bagier

I agree that it is a very bad investment.

We should like to hear with what the right hon. Gentleman would replace the £28 million to be phased out from R.E.P. There were no proposals from Selsdon Park about what is to happen over S.E.T. The party opposite has made great play about replacement of S.E.T. and this affects the Northern Region. What is to replace it? When we examine the wide proposals of the party opposite for expenditure, we see that S.E.T. must be replaced by something. If it is to be value-added tax, will the right hon. Gentleman spell out what that will mean in terms of regional development? Will it be of assistance to that or not?

I hope that we shall hear what is to replace investment grants. I take note of the Amendment to which the names of the hon. Member for Newcastle, North and the hon. Member for Tyne-mouth (Dame Irene Ward) have been attached. The Amendment appears to infer indirectly that some supporters of the Government believe that much of this investment is not necessary in providing jobs and is a waste of money. I do not look at it in that way. It is investment in the country and I want to see some of it in the North-East. It cannot be dealt with in a black and white way, with some for one part and none for another part; we want to see a mixture.

Of course I want labour-intensive industries, but I also want capital-investment industries. I do not want off-shoots of factories in the South employing a couple of hundred people in the region and then, at the first sign of cold, those off-shoot factories closing down. I want long-term investment, both for capital- and labour-intensive industry. There is no easy way about this. I should like the right hon. Member to explain this afternoon how the replacement of investment grants could easily bring labour-intensive industries to the North.

In some ways this debate is unusual. Normally, on a private Member's Motion one tries to use arguments near and dear to one's constituency and its problems, but arising out of the proposals which came from the Selsdon Park conference there is grave danger and fear, not only in the hearts of my supporters but also in the hearts of industrialists in the region. The right hon. Gentleman owes it to them at least to spell out what those proposals mean.

In the debate I am certain that my hon. Friends will be able amply to underline the 13 years of waste which we had in the North-East under the Tories. Let us not say 13 years because hon. Members always moan about that. Let us say at least nine years, because from 1951 to 1958 there were two things which hon. Members opposite did not do. They did not build one advance factory in the North-East and did not open one training centre. That is an indictment of hon. Members opposite. They must have known this, for it was preached at them plenty of times by my hon. Friends who were in this House before I became a Member. I have read the debates and know that my hon. Friends told them what could and should have happened then.

In studying the success or failure of a Government, that Government should be given a fair crack of the whip. It is fair to ask that. If we analyse the situation after five years of Labour Government and put it alongside that of 13 years of Tory government it will be found that our Government do not come out too badly. Over the last seven years 200 firms have come to the North-East; 50 of them came last year. So we have reason to hope and believe that the policies which we are pursuing, which started in an atmosphere of deficit, are just beginning to pay off.

I ask hon. Members opposite, if they have any influence at all with their local government colleagues, to draw their attention to some of the harm which some local authorities are doing. Hon. Members opposite should ask them not to cut back the house-building programme to the extent to which they are cutting it back and not to make of the rate bill a holy cow. If they want to keep a steady rate, let them be honest and thank this Government who, for five years, successively have provided the equivalent of a 5d. rate We do not find resolutions referring to that coming from Tory local councils. South Shields Council, Tory-controlled, cannot find the 25 per cent. of £1 million required for very important road works, 75 per cent. of which would be met by the Government.

Tories there are becoming very parsimonious, as they were in the national sense when they were the Government from 1951 to 1964. I hope that the hon. Lady the Member for Tynemouth will urge her council not to be parsimonious, but to meet its share in providing half-rate bus fares for old-age pensioners.

Dame Irene Ward (Tynemouth)

Could the hon. Member explain the problem in Whitley Bay? We had a scheme for dealing with coast erosion. A plan was sent up to the Government, but the Ministry has asked us to send a cheaper plan.

Mr. Bagier

The hon. Lady puzzles me. I gave way to her on the understanding that she would say something about her local council, which has refused to meet its share of the passenger transport authority's scheme for providing half-rate fares for old-age pensioners.

I hoped that the hon. Lady would be sympathetic towards that and would use such influence as she has with the local council. I mentioned this matter to show how parsimonious the Tory Party can be in office both locally and nationally. Of course, hon. Members opposite can offer great things when they are in opposition, but we have had the experience of what they did from 1951–1964. We do not want those days back again.

I impress on my right hon. Friend that, far from being complacent about the situation in the North-East, we are still extremely angry. Whatever this Government, and especially the two Ministries concerned, have done, we still have tremendous problems. I hope that the Government will look again at the question of making Sunderland a special development area. We have empty factory space which is not let because of the competitiveness of special development areas surrounding Sunderland. More important, I beg my right hon. Friend to implore the Chancellor of the Exchequer to see whether a measure of reflation can now take place because this difficulty has been the root of the unemployment problem.

The Northern Region has traditionally carried more than twice the national average of unemployment. We hope that that will not last for long. If the national average can be brought down, that can have a great impact on the region. There is one thing which neither my hon. Friends nor I can accept. When we have a first-class balance of payments situation, as we now have, and have been pursuing policies which have been tough, I hope that the Chancellor will not assume that we can enjoy a first-class balance of payments on the backs of unemployed in the North-East.

This is what I do not want to see happen. I want to see my right hon. Friend examine it and consider whether there are any further measures by which we can be helped and also to ensure that as we are coming towards a situation of "breaking even", that there is no further setback in the North-East.

The Motion I have tabled refers to the 13 years of wasted Tory government, wasted years of not anticipating and planning for the future of the North-East; to the proposals that the Tories would impose if they came back into office arising from their Selsdon Park meeting and it congratulates the Government in at least pursuing policies aimed at trying to put things right—because I believe that this Government want to put things right and believe in trying to put things right and have more chance of putting them right than right hon. and hon. Gentlemen opposite. I therefore commend the Motion to the House.

Mr. Deputy Speaker (Mr. Harry Gourlay)

Order. Before I call the next speaker, perhaps I should remind the House that this is a short debate. Many hon. Members from the North want to participate, and brief speeches will enable more to do so.

4.41 p.m.

Mr. R. W. Elliott (Newcastle-upon-Tyne, North)

I shall try to meet with your appeal, Mr. Deputy Speaker, and make as short a speech as I possibly can.

As is customary—and with all sincerity —I congratulate the hon. Member for Sunderland, South (Mr. Bagier), first, on his good fortune in the Ballot and, second, most certainly on the manner in which he delivered his speech. But there my congratulations must end.

I agree, however, with one or two things which he has said. I agree that industrialists in the Northern Region are worried at this time. They certainly are. They are worried at the very vague possibility of the return of a Labour Government. Until quite recently they used to say to us, "When are you going to get them out?". Now, looking slightly worried, they say, "They cannot possibly win, can they?". I agree that industrialists are worried.

Second, at the end of his speech the hon. Gentleman appealed to his Front Bench, as well he might, that they should not have a surplus on their balance of payments at the expense of high unemployment. But that is exactly what the Government have. They have a surplus on their balance of payments due in the main to heavy credit restrictions and a very high level of unemployment in the weakest sections of the economy—the development areas.

Mr. Bagier rose—

Mr. Elliott

The hon. Gentleman must recognise that Mr. Deputy-Speaker has asked for brief speeches.

Mr. Bagier

The hon. Gentleman's Government had exactly the same or in some cases higher unemployment figures and a balance of payments deficit.

Mr. Elliott

If the hon. Gentleman starts comparing unemployment figures in the 13 so-called wasted years with unemployment figures at the moment, he will not make the comparison for very long.

There is another point I must make in reply to what the hon. Gentleman said several times. The hon. Gentleman said apologetically, in terms of his Government, that they have not been in power very long. But they have. It is quite a long time now since 1964 and to many in this country and certainly to right hon. and hon. Members on this side of the House, it seems longer. But 1964–70 is a long time, and it is no use using that as an excuse for the absolute failure of the economy which the Government have produced. They have been in power for long enough—almost half the length of time that we were in.

Before criticising the hon. Gentleman's speech generally, I should like to make one further reference to what he said. The hon. Gentleman quite rightly referred to training and talked of a stark comparison. He mentioned a speech I made in the House on unemployment a short while ago, and I thought that in that speech I answered his point. Very briefly, I shall do so again.

The speech concerned training places and centres under the Conservative Government. The question was half answered by the hon. Gentleman himself. It was much more difficult to create training places and to persuade people to go into those training places when we had comparatively full employment. As I said in that recent speech, when I entered the House about 12 years ago we could not fill the training places in the Government centres. The hon. Member for Jarrow (Mr. Fernyhough), who was recently in the Department concerned, will recall that in the training centres at Felling and Tursdale there were empty places, but it was because we had full employment.

In full employment men, women and school-leavers can obtain a job without training and it is not likely that they will then undertake it. In those days, people wanted to get straight into employment, and they still do. I agree with the hon. Gentleman that we have a big training problem in that 8,000 only of the 56,000 registered unemployed men in the North-East have any skill at all. This is a problem that we must face fairly and squarely, but even now, with all the training places, it is difficult to persuade man to take training places if they are still afraid of losing money thereby.

Mr. Ron Lewis (Carlisle) rose—

Mr. Elliott

It seems odd that every time I begin a speech on the North-East the hon. Member for Carlisle (Mr. Ron Lewis) interrupts me almost before I get started.

Mr. Ron Lewis

It, as the hon. Member implies, there was full employment at that time, why did the Government of that day send the right hon and learned Member for St. Marylebone (Mr. Hogg) to Tyneside and the North to look into the question?

Mr. Elliott

With respect, the hon Member for Sunderland, South talked of 80 training places. This was back in the 1950s and from 1951 until, as the hon. Gentleman quite rightly acknowledged, 1960 the problem had not be come acute.

It was the rundown in the coal-mining, shipbuilding and steel industries which brought this immense problem upon us. Since then, the problem has been substantially aggravated by the failure of the present Government's central economic policy. That is what we must hammer home to the public over and over again. Development areas have no hope at all of overcoming their problems if the central economic policy of the Government is failing.

When hon. Members from The North-East come out top of the Ballot they automatically choose the problems of that area as their subject. That is wholly understandable. Our unemployment problem, after six years of Labour government, is the worst in the country. The difference between the present Motion and that of his hon. Friend the Member for Consett (Mr. David Watkins), who was last to be lucky in the Ballot, is that there is a considerable change in emphasis.

In the past, the hon. Member for Con-sett and others of his hon. Friend's have appealed to their own Front Bench to do something more for the region and have suggested that not enough has been done. But, of course, we have reached election year and the hon. Member for Sunderland, South has turned his attack to this Front Bench and to Selsdon Park. He is suggesting that we shall not do enough. Obviously, he realises that the policies of his own party have failed. He has now turned on ours. It would be better if we had a General Election and could put our policies into action.

Mr. David Watkins (Consett)

I realise that time is pressing, but I must draw the hon. Gentleman's attention to the fact that the Motion which I moved, which was carried by the House, welcomed the remarkable economic and social progress which has resulted from the policies of the Government".

Mr. Elliott

I think that the hon. Member, whose speech I remember as being moderate, went on to suggest that the Government were not doing nearly enough. But I find that part of the Motion today was most surprising in that hon. Gentlemen opposite congratulate the Government on the policies that they are pursuing. They have done very little for the North-East. We were told in 1964 that wonderful things would happen. We were told of the economic planning council and all the wonderful changes which would be brought in as a result of planning.

I found this part of the hon. Gentleman's Motion so surprising that, over the weekend, I turned up the election address on which he sought to represent—and he succeeded—the people of Sunderland, South. This is what he said: When Labour wins—there will be full employment every year—not just election year" There is double the national average of unemployment in the region, and on Wearside, where the hon. Gentleman's constituency lies, there are now 59 men out of work for every job vacant. What a commentary that is on the Government whom the hon. Gentleman supports, and what a hollow cry his words in that election address now seem. I quote again: When Labour wins—there will be a square deal for all workers. I cannot help pondering on what the hon. Gentleman may write in his next election address.

The Northern Region continues to carry 10 per cent. of the total unemployment in the country, although we have but 4.8 per cent. of the work force. In the region as a whole—it is much worse in Wearside, I know—there are 13 men unemployed for every vacancy. Nationally, bad though it is, there are just four men for every vacancy. For every worker in employment, there are two unemployed. That is the grim picture in the region now, and that is the summary of the employment problem facing us today.

My reason for seeking to amend the hon. Gentleman's surprising Motion—I did not succeed with my Amendment, and I accept that—is that it is high time we faced the hard facts. The hon. Gentleman the Member for Middlesbrough, West (Dr. Bray), whom I am happy to see in his place, made a good point in his speech on 3rd November last year. The National Plan is forgotten. It was a failure. The planners, who used to tell us that we could not plan, have failed. As the hon. Member for Middlesbrough, West rightly suggested, the time for public relations exercises is over.

As I rather thought he would, the hon. Member for Sunderland, South, once again referred to the so-called inheritance, the story of the £800 million deficit. It is the only defence which the Labour Party now has left for the fact that we have double the taxation that we had in 1964, and record price increases, increases the like of which have never been seen in our country's history before. The rise is weekly now, as the housewife in the North-East, this distressed area, realises every time her shopping bill goes up again. We have crippling interest rates, higher than at any time in our history, and we have the present deplorable level of unemployment.

A deficit of £800 million in 1964 is a very bad argument, a dishonest argument. In 1964, our balance of payments position was rapidly improving. [Laughter.] Hon. Members may laugh, but I have taken part in these debates over quite a long time now. When we were on the Government side, I used to speak in debates about potential and probable unemployment, and I fought the elections in 1964 and 1966.

After 1964, due to Conservative measures, our balance of payments position improved so rapidly that the deficit on current account had been eliminated by 1965. The hon. Members for Sunderland, South and for Newcastle-upon-Tyne, East (Mr. Rhodes) will remember Labour's slogan at the 1966 election: Now you know that Labour government works". It appeared to have done so for a brief period at the time. But half that deficit, as the hon. Gentleman well knows, was investment.

If hon. Members will examine the figures, which show what our national stock position was at the time, they will never again talk of the deficit or talk of the "wasted Tory years", as the hon. Member for Sunderland, South did.

I draw to the attention of hon. Members opposite an article which appeared The Times Business News of 22nd January this year, written by Professor Paish, an eminent economist, and headed: Saved by the fall in stocks". Professor Paish inssued the warning that A favourable balance of trade accompanied by an exceptionally low level of stock accumulation is unlikely to be maintained. But that is what we have now.

Conversely, he went on, an unfavourable balance of trade is less likely to persist if it is accompanied by a … high level of stock accumulation …". I recommend to the hon. Gentleman and his hon. Friends an examination of the comparative stock accumulation position between 1964 and now. The table which Professor Paish produced puts the Tory performance in 1964 in a very different light.

The stock accumulation—largely raw materials and fuel brought in for manufacture and subsequent export—was high, at a higher level than it is now. In 1969, the favourable balance of payments in the last quarter could be negative because—this is what we strongly suspect—there has been destocking. The tragedy of the last six years, years which are much more wasted years than the 13 Tory years we hear so much about, is that we have lived on stocks.

The present Government reaped the harvest in 1965 and 1966. They increased Government expenditure between 1964 and 1967 without any increase in economic earnings at all, and at the same time they increased taxation by fantastic amounts. So much for the fallacy of the supposed wasted years.

Now, the Government's economic measures are hurting the North-East more than ever before. Hon. Members will have noted, as I did, the severe warning issued by the C.B.I. last Friday in The Times. It is suggested that there would be a continuing substantial fall in capital spending. It is the severe squeeze which above all else is hurting the North-East at this time.

One can gain a quick indication of the true position from listening to what industry itself has to say. I am sure that hon. Members from the North-East visited industrial concerns, managing directors, and so on during the Christmas Recess, as I did. Over and over again, one realised that business, large and small, is short in liquidity and, consequently, short in investment. Industry cannot move. As in the case of the Crowborough engineering firm in Aycliffe which I mentioned in the debate on unemployment, industry is unable to adjust and has not the liquidity to do so.

The hon. Member for Sunderland, South commented on our Selsdon Park proposals regarding investment incentives as against grants. There is a high level of Government expenditure in our development areas, as the hon. Gentleman himself made clear when he gave the actual amount. If roads and houses as well as industrial incentives are included, the total works out at about £95 per capita This is substantial investment, substantial economic aid, but the trouble is that the money is not being spent in a successful way. The aid is not succeeding. The aid which was supposed to cure unemployment has not done so.

In February, the level of unemployment is slightly down in the region, now that we have moved from January and the height of the winter is over, but I hope that hon. Members have noted that, although unemployment is slightly down for February in the region as compared with January, it is not as much down as it was in February last year compared with the January. In other words, the position has worsened.

Referring to the development area investment differential, the hon. Member for Middlesbrough, West, speaking in the House on 3rd November, said: In many cases the effect of this indiscriminate handout,"— I agree with him that that is so— given without any test of the number of jobs created, is actually to reduce employment in the development areas."—[OFFICIAL REPORT, 3rd November, 1969; Vol. 790, c. 721.] That is our main criticism of the economic aid which has been pumped into the area—and, incidentally, I gave the hon. Member notice that I should refer to his speech.

Dr. Jeremy Bray (Middlesbrough, West)

I am grateful to the hon. Member for reminding us of the point, because the indiscriminate capital subsidy was introduced by the Conservative Party when they were in power, with the free depreciation system, which was more capital intensive than the present system. Furthermore, while the Government are examining this question, the Opposition have already "jumped the gun" and have said that they will continue the indiscriminate capital subsidies.

Mr. Elliott

I doubt very much whether that is what has been said, but my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) will no doubt make his own contribution to the debate.

Free depreciation had a very short time to work before we lost office. Free depreciation and investment allowances, contrary to grants, at least are tied to efficiency. The whole theme of our policy of aid to development areas is that they should not stand for ever with begging bowls, but should be encouraged to move towards standing on their own feet. That is why I believe that our proposals will be much more effective than those of the Government.

As the hon. Member for Middlesbrough, West said, grants have sometimes given aid where it has reduced the possibility of employment by capital its intensiveness. Aid has been given in other cases where it has not even been required and not even wanted. He mentioned one case in his speech. He referred to the movement of Shell to the region; they stated that they had not taken the subsidy into account as one of the reasons for going to the region.

We appeal from this side of the House to hon. Members opposite to recognise, even now, that there is not an unlimited supply of wealth which can be tapped for ever. I used to speak on this subject from the Government benches when we were in office and to listen to Labour hon. and right hon. Members from the Northern Region talking in the broadest sense about aid. They argued that the development areas were not big enough and that the provisions of the Local Employment Act were not wide enough.

But that Act was working very well indeed in the Northern Region, and I believe that its machinery could work well again by bringing aid where it is most needed and where it can provide the greatest assistance in relation to the number of jobs. But that was not enough for the region, so right hon. and hon. Gentlemen opposite said when they were in opposition. They wanted more aid, wider aid and wider development areas. They wanted factories at the pit heads.

But no progress was made until my right hon. and learned Friend the Member for St. Marylebone (Mr. Hogg) went to the region and instituted his excellent inquiry—the only inquiry which has been worthwhile. Indeed, with the greatest respect to others, he was the only Minister with responsibility for the region to set out what the region needed, and he emphasised that there were only certain parts of the region to which industry could go and only certain areas in which industry could develop. On taking office in 1964, the Labour Government did not take that advice—certainly not at the beginning. I wonder what the. Economic Planning Council has been doing over the years. Certainly, I do not know. When it eventually produced a report, called "Challenge of the Changing North", it made again the point which had been made in the Hailsham Report.

I claim to have been consistent in my suggestions about what is needed in the development areas. I have argued consistently that we should give such aid as is available where it is most needed and that that aid should be tied to productivity and to jobs created. There should also be a sensible selectivity about aid, both between development areas and within them.

As I said in the debate on unemployment a short time ago, it is wrong that the Northern Region, with its high unemployment figure, should be receiving only £48 per head in public investment when Scotland, with I per cent. lower unemployment, receives £62 per head. Why did not the Government have the political courage to deschedule Merseyside, as Hunt proposed? If an area has overcome its problems, let us de-schedule it and make more aid available to put into a viable condition those areas which have continuing problems.

I will sum up. No one doubts for a moment—and the hon. Member for Sunderland, South is certainly right about this—that the Northern Region has problems which are still immense. Nevertheless, I deplore his Motion, particularly that part of it which refers to the wasted years. I am certain that the vast majority of people in the Northern Region would like to go back to those years. [HON. MEMBERS: "No."] We shall see at the polls. It is election year. They would certainly prefer the level of employment or unemployment which they had then rather than the level which they have now. They would prefer to go back to the level of taxation which we knew then rather than the level of taxation which we know now.

I appeal to hon. and right hon. Gentle men opposite to recognise that it is the central economic policy of the Government which has failed. I noted that the hon. Member for Newcastle-upon-Tyne. East (Mr. Rhodes) said just before the weekend that if our entry as a nation into the Common Market is bad for the North of England, he is against it. Like his Leader, the Prime Minister, he is good at instant publicity. Incidentally, any trust that anyone on this side of the House or anyone else in the country had in the Prime Minister must have disappeared altogether following his speech this weekend about the Common Market.

Surely the answer to the hon. Member for Newcastle-upon-Tyne, East is that if our entry into the Common Market is judged to be good for the nation economically and in terms of trade, it will be good for the North-East and for other development areas. The urgent need is to get a national economic policy which works. The only way in which we shall do that is by having a General Election and a Conservative Government.

5.9 p.m.

Mr. Geoffrey Rhodes (Newcastle-upon-Tyne, East)

I will deal first with the last point made by the hon. Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott). I wrote an article in the Evening Chronicle based on a detailed experience of Europe in the last few years, for, with the possible exception of my hon. Friend the Member for South Shields (Mr. Blenkinsop), I have probably spent more time in Europe in the last two years than anyone else in the Chamber. [HON. MEMBERS: "No"] I will not argue that. From a detailed examination of the regional policies of Europe, which I have made as a delegate to the Council of Europe, I stated that the evidence so far is that the North would lose out relative to the rest of the nation if we entered the Common Market and that unless we can get a stronger reassurance on this point I for one "would not be keen on out entry". That is all that I said, and I do not think it an unreasonable comment.

In his opening remarks the hon. Member for Newcastle-upon-Tyne, North said that Newcastle industrialists are worried about the return of a Labour Government at the next election. In that case they must be very worried indeed, because they are also worried about the Conservative Party. Perhaps I might quote that staunch Conservative newspaper the Daily Telegraph which on 7th February referred to Conservative policies in relation to the regional employment premium: Shippers fear a Tory victory. Swan's profits would be wiped out. Just as a modest improvement for Vickers was in sight, wham! knocked on the head by the disappearing premiums. Already complaints have been lodged with Mr. Heath. One can say that again. If it is argued that this is purely a speculative article on a national basis, let us consider the industrialists locally with whom the hon. Gentleman has been conferring, I gather, during the Christmas Recess. According to the Journal of 9th February, 1970, the Managing Director of Swan Hunter, Mr. McIvor, referring to the proposals of the Conservative Party on R.E.P., said: It would be a blow. Mr. Ronald Baker, the Commercial Director of Clarke Chapman, said: It would make us less competitive and that would have an effect on unemployment. Mr. Gordon Baker, Managing Director of Parsons, said: If we were deprived of this source of income it would have a long-term effect. It certainly would. I echo the remarks of my hon. Friend the Member for Sunderland, South (Mr. Bagier), that it seems very odd that this company which. as a result of R.E.P., receives £1½ million a year, and has recently contributed £4,000 to the campaigning funds of the party opposite, has now got kicked in the teeth. It is a very poor investment indeed. If the Tyneside industrialists are worried about the return of a Labour Government, there does not appear to be much consolation in the return of the party opposite either.

I wish to refer further to this R.E.P. issue, but before I do so I want to deal with a point in the speech of the hon. Member for Newcastle-upon-Tyne, North in relation to the February unemployment figures. He has misread them. He said "Our Northern figures are worsening". That is not true. The February figures show a greater improvement in the northern region than in any other region in the United Kingdom. The improvement in the North was relative to the nation as a whole and was against the normal seasonal drift in February. Although I do not wish to make much out of one month, I think the point made by the hon. Member for Newcastle-upon-Tyne, North is invalid.

Mr. R. W. Elliott

I was comparing the figures for the northern region this year and last year as against the national picture. I repeat that the improvement is minimal and that the basic problem remains.

Mr. Rhodes

I appreciate that the hon. Gentleman was comparing the figures with February, 1968, in terms of the relative improvement in that one month. I heard him say it. All I am saying is that this is the wrong comparison to make relative to the rest of the country. If, given the same climatic changes in the rest of the country, the North improves its position relative to the rest of the country, I welcome that change, as did the representatives of the North-East Development Council and other regional industrialists. However, I would not want to make too much out of one month.

I wish to refer now to the effects of the regional employment premium. This may be a unique occasion because it is probably the first time in the history of this House that three Members at present in the Chamber all represented one constituency — Newcastle-upon-Tyne, East. Therefore, the issue that I am talking about will be of great interest to my hon. Friend the Member for South Shields, the hon. Member for Brierley Hill (Mr. Montgomery), my old opponent sitting opposite.

I wish to refer to Swan Hunter and C. A. Parsons, the two biggest industrial firms in the north of England, I would guess. Parsons employs a very large number of men in the development areas. I believe that out of a labour force of 22,000, 16,000 are in development areas, and of those 16,000 half are in my constituency. The Swan Hunter consortium is probably the biggest industrial employer in the whole of the North of England. These two concerns employ about half of all workers in the constituency of Newcastle-upon-Tyne, East; plus many others from Newcastle-upon-Tyne, North, Wallsend and South Shields. These two industrial concerns, therefore, vitally affect the livelihood of half of my working constituents.

If the Tories are elected to power, I want to know what will happen with the abolition of the regional employment premium. I suggest that if R.E.P. is abolished on the basis put forward by Conservative leaders in the last few months, thousands—I use the word advisedly, not hundreds—thousands of people will be thrown out of work in my constituency alone.

Let us consider the shipbuilding industry. The right hon. Member for Leeds, North-East (Sir K. Joseph) said that the improvement in shipbuilding was due to a boom in world shipping, and devaluation.

Sir K. Joseph

And other things.

Mr. Rhodes

And other things. The devaluation effects are now wearing off and the world shipbuilding boom is tapering off. I therefore concentrate on the regional employment premium. The Swan Hunter consortium last year made a profit of £ 1..6 million, so it is estimated. In regional employment premium it received £1.5 million. That is why I say that, taking all the factors upon which the right hon. Gentleman put so much faith, that company would have made no profit whatsoever in the recent financial year and, in fact, would have been out of business.

The only alternative is that it would have had to put up its prices in a highly competitive world shipbuilding market, which will become even more competitive in the next three or four years, and it would have lost a half, if not two-thirds, of the present orders on its order books.

A few years ago when I was fighting the constituency against the hon. Member for Brierley Hill, I was worried, as I am sure he was, at the continual declining employment prospects in the Walker Naval Yard and the shaky position of C. A. Parsons which was losing orders on the home front because of a contraction in demand and was having difficulties in development costs in relation to the international market. These massive industrial concerns in the northern region are now booming at a tremendous rate. The shipyards are very busy with an enormous order book and they will be kept busy for several years. C. A. Parsons is so busy that in order to take on the work, it is having to cut back in important sections of other work.

These massive industrial concerns would lose a lot of money under the Tory Government's policy. Reyrolle Parsons received £1.5 million in regional employment premium—£78 per head for every worker. If it put up its prices it would lose orders in a highly competitive international market. Therefore, we have a particularly special problem on Tyneside in relation to this policy. Clarke Chapman received £400,000 in regional employment premium last year. True, that firm is not in my constituency, but it certainly would affect the constituencies of some Members who are present today.

I want to make a simple point. Half of my constituents depend upon the two industrial concerns. Both of these concerns rely upon heavy Government subsidies without which they would probably be out of business. In order to economise on public expenditure, the Conservative Party would cut out costly and what the hon. Member for Newcastle-upon-Tyne, North on 3rd February called inefficient and ineffective methods of distributing public money. They say that they are going to save on income tax. If they save on income tax by cutting down on Government aid in this way, it will not be much consolation to those workers in my constituency who are put out of work by these policies and who would not get the benefits of reduced income tax, even if those benefits should materialise. This is a point to which we want an answer.

As this matter was publicised in the Newcastle Journal only a few days ago, I am surprised, if I may say so to the hon. Member for Newcastle-upon-Tyne, North, whom I like very much, that he avoided this issue altogether. He may be leaving it to his right hon. Friend to deal with, but he should answer this question in his own constituency. When I go to the shipyards and to C. A. Parsons I sometimes meet the hon. Gentleman's constituents who ask what will happen under this policy. This House wants to know the answer tonight. If the answer is, "We will find other ways of giving money equal to what they are now getting"—I am sure that the same will be said of other cuts that the Tories intend to make—I would like to know how hon. Gentlemen opposite will cut Government expenditure and taxation. The same could be said of housing, health, the social services and the rest, and this argument has been adduced pointedly by my right hon. Friend the Prime Minister recently.

I am sure that the hon. Member for Newcastle-upon-Tyne, North meant it in a friendly way when he referred to me personally and wondered if I modelled my speaking and publicity techniques on that of the Prime Minister. I do not know if I do. However, I never consult my right hon. Friend about what I intend to say in my constituency. Whether or not it is a technique that secures publicity I do not know, save that I am certain that the public are talking about the things which concern me and that I am concerned about the things that concern them.

I hope that the maximum publicity will be given by the local Press to the figures and forecasts that I have given, since I have given them following discussions with local industrial leaders, who, I am sure, appreciate that if they were to elect hon. Gentlemen opposite they would be jumping from the frying pan into the fire, particularly in view of Conservative policy for the abolition of R.E.P.

If the Conservatives were returned to power it would mean an end to the propping up of local industries in the North. Their policies for the development areas would result in a quagmire of despair, particularly bearing in mind the full employment in the major industries in my constituency.

When I think of the number of hours that I have spent trying to negotiate major contracts for the big concerns in my area and wonder what all the effort that I and others have put in would stand for if the Conservatives were elected and they abolished R.E.P., I am dismayed. It would mean R.I.P. for a large number of people who are at present employed in the two large industrial concerns of which I have spoken.

Mr. Fergus Montgomery (Brierley Hill)

Which contracts has the hon. Gentleman brought to the Newcastle area?

Mr. Rhodes

I have said that I have negotiated with Ministers at the request of the managements of industrial concerns.

I have referred, in particular, to C.A. Parsons in relation to a series of orders that that firm has been wanting in recent years. I say this in public, and I do not think that any manager of Parsons will deny that I have wads of correspondence, all undertaken on their behalf, to get Government support for projects in which they have been interested, sometimes with a considerable degree of success, but not always.

That is not to take into account, for example, the job that that firm has done in putting in the power guts of the Alcan plant. The hon. Gentleman used to represent my constituency. He must have been approached by local industrialists. He must have done what I have done. I certainly hope that he did.

A free-for-all society in which the natural forces of the economy would suck in the commercially profitable enterprises, leaving the devil to take the hindmost, coupled with development area policies including the abolition of R.E.P., is the philosophy of the right hon. Member for Wolverhampton, South-West (Mr. Powell); and what he says today the Leader of the Opposition says six months later.

The workers of Tyneside should be warned of the smooth, glib Tory policies which, hon. Gentlemen opposite say, would mean a cut in Government expenditure. In fact, they would mean cuts in the enterprises which are today making Newcastle increasingly prosperous. [Interruption.] There is no need for hon. Gentlemen opposite to jeer. In my constituency there is full employment. Parsons is working at full pelt, and the same can be said of Swan Hunters. If hon. Gentlemen opposite who represent constituencies in the area do not know this, they know nothing about the region. These smooth, glib Tory policies cover a multitude of undigested, ill-thought-out, irresponsible ideas the consequence of which would be unmitigated disaster for the northern constituencies, and mine in particular.

My parting shot is a quotation from the local Jourtnal of Wednesday, 11th February. Bang in the centre of it appeared a picture of the right hon. Member for Leeds, North-East. Headed: What will the Tories do for the North-East? this sympathetic article—I could disagree with three-quarters of it—contained this passage: The development areas are not, after all, of very much political importance to the Tories. It is unlikely they would win much sympathy from the present North-East electorate, whatever policies they introduced. Considering that that was written by a writer sympathetic to their policies, I suggest that hon. Gentlemen opposite do not care because the North-East does not hold much political kudos for them. My hon. Friends and I, on the other hand, do care. We represent these people and their best interests.

5.26 p.m.

Sir Keith Joseph (Leeds, North-East)

I very much regret having to ask the House to acquit me of discourtesy if I leave the Chamber almost immediately after speaking. I have a commitment which, if at all possible, should be honoured, and this will require my having to leave shortly after 6 o'clock. I have expressed by apologies to the Minister who will reply to the debate.

I also regret the tone adopted by the hon. Member for Newcastle-upon-Tyne, East (Mr. Rhodes) because his hon. Friend the Member for Sunderland, South (Mr. Bagier) was not nearly as arrogant in his approach. If any hon. Gentleman opposite can truthfully say that the present Government have got all the answers right and are doing wonderfully, then and only then can my hon. Friends and I be accused of not caring in our approach.

The simple fact is that the public and hon. Members generally should accept that all parties and all Governments, in the national interest and in their own self-interest, desperately want to get these things right. If my party has something to learn from its experience, and I am sure that it has, then the party opposite will find, when in opposition, that it has much to learn from its conduct and its regional policies as a result of its years in office.

We do not approach this debate in a polemical spirit, though we must answer the polemics. We approach it in a genuine desire to seek the truth about the best package of policies that will bring national and regional prosperity to the people of Britain. I thought that such political and factual points that were validly made by the hon. Member for Sunderland, South were effectively countered by the excellent speech by my hon. Friend the Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott).

We all accept—this is the basis of what I am saying and I hope that the Minister will rest his speech on the same basis—that Governments of both parties are reaching out for the right solution. Neither party has yet found it to perfection. Thus, we must both learn from each other's and from our own experience.

Between 1951 and 1958 unemployment in the North was extremely low. For that reason there was not a debate on the subject between those years. Even in December, 1962, the Financial Times said in a dispassionate article on the subject that one of the post-war boom regions had been the North and that even then—in December, 1962—unemployment, though serious, was highly localised.

It is some evidence of the validity of the case that I am making about the 'fifties as a whole that in 1959 the Conservative Party increased its number of seats in the North. I do not say that as a final or conclusive argument but as evidence that during the 'fifties there was no disaster in the North.

The Minister may be entitled to say that, although there was very low unemployment during the fifties, the seeds of future trouble were perceptible. That may be so. Indeed, my hon. Friends and I are constantly pointing to present Government policies that are likely to yield a disastrous harvest; and only too often in the past we have been shown to be right. I have accepted already that we have something to learn from our experience.

By the time my right hon. and learned Friend the Member for St. Marylebone (Mr. Hogg) went north at the turn of 1962–63, he was authorised by the then Conservative Government to set in hand a large investment and other programme, the fruits of which are now being garnered. We pay credit to the present Government for continuing the Hailsham programme to some extent, even during the squeezes and freezes of the past few years, but let us be quite clear where the credit for that surge of investment should go.

I turn to a factual statement about the present position. Factually, as compared with all other regions, it is the North, the region chosen by the hon. Member for Sunderland, South for today's debate, that has suffered more than any other from the freeze, the squeeze, and the lack of growth of the last three and a half years of the Labour Government's performance. Those figures can be checked against every index, but I will today choose only a few.

Taking March, 1969, the last available figure, and comparing it with 1964, there has been an absolute loss in the Northern Region of 33,000 jobs; that is a fall in employment of 2.6 per cent. Unemployment has risen to very nearly double the national average. For February, 1970, it is 5.2 per cent. in the Northern Region against 2.7 per cent. for the United Kingdom as a whole. At present in the Northern Region about 66,000 are unemployed. That figure for totally unemployed has been exceeded only twice since the war; once during the severe winter of 1963, when we had the worst winter of the century, and once during the national fuel crisis of 1947. when it was at an even worse level.

During the 1950s and until 1964 the annual net emigration from the Northern Region—and I am not proud of this figure—was 8,500 people. Since 1964, the net annual emigration from the region has been 10,000 a year. I could read to the House a long list of the high unemployment percentages in individual employment areas in the Northern Region. Most of the hon. Gentlemen sitting opposite represent these towns and they know well how bad the figures are: Bishop Auckland, 7.2 per cent., Chester-le-Street, 7 per cent., Consett, 6 per cent., Hartlepool, 6.3 per cent., Peterlee, 6.4 per cent., and so it goes on. In all cases the figures are worse than or just about the same as in 1964.

The Minister of State (Mr. T. W. Urwin)

Does the right hon. Gentleman recognise that each employment exchange area which he has quoted has been subjected to serious and severe job losses in the last four or five years, a problem which did not to the same extent concern the Conservative Government up to 1964?

Sir K. Joseph

Yes, of course I do, but it was the cataclysm of the decline in the coalmining industry that caused the rising unemployment in the early 1960s which precipitated the visit of my right hon. and learned Friend the then Lord Hailsham. The coal decline hit the North like a tidal wave. It started at the end of the 1950s and made its full impact in the early 1960s and has increased since. The increase of output per man, and therefore the decline in total employment in the chemical, steel and shipbuilding industries occurred at the beginning of the 1960s and has continued in aggregate, becoming worse during the last few years. Of course, I give the point to the hon. Gentleman.

Behind all this is the one overwhelming fact which my hon. Friend the Member for Newcastle-upon-Tyne, North so strongly brought out, that the national rate of growth has very nearly halved during the last few years. Whereas during the Conservative years of government the gross national product was growing at 3.8 per cent. a year, during the last few years it has been growing at 2.2 per cent. a year. It is this, above all, that has wrecked the Government's good intentions. Of course they have had good intentions. It is the general failure of their national economic performance that has cast them into disaster.

Now in the North the indices are very sad. Whereas the vacancy rate—that is, the vacant jobs compared with the unemployed—is one to three for the nation as a whole, it is one to eight for the Northern Region. An even sadder fact is the 40 per cent. rise in long-term unemployment, and I hope the Minister of State will reply to this point. Whereas in October, 1966, 19 per cent. of the registered unemployed had been out of work for more than a year, by October, 1969, that figure had risen by 40 per cent. to 27 per cent, of the fulltime unemployed. Most of us who consider these matters recognise that it is not the less than eight weeks unemployment that is tragic for a man, but the long unemployment. That is why this figure more than any other is so serious.

Mr. E. Fernyhough (Jarrow)

I am sure the right hon. Gentleman would not want in any way to falsify the position. The long-term unemployment to which he refers relates mainly to miners who are 55 years of age and over and who are unlikely to get jobs easily. It is connected with the quick rundown of the mining industry.

Sir K. Joseph

Yes, that may be so, but I doubt if it explains the whole rise. The rise as a whole is explained by the lack of new jobs in an economy that is not as buoyant as we should all like it to be.

I fear that I can add further depressing facts to the list that I have already produced. The earnings in the North are declining as a proportion of national earnings. They are now 13 per cent. below the national average earnings. The share in the North of the jobs likely to result from I.D.C.s granted has been falling. Whereas in 1964 22 per cent. of the I.D.C. jobs, that is, the jobs related to I.D.C. approvals, were for the North; in 1968, the last relevant figure, they were down to 13 per cent. There can be no doubt of the present unfavourable position of the Northern Region.

May I come now to the criticism that is made of the Government's policies, coupled with our own proposals. I must repeat that no region and certainly not the Northern Region will find prosperity until the nation is prosperous. A buoyant national economy is the indispensable background to regional recovery and prosperity. That is why the economic disasters of the mistakes of the first few months and years of this Government are still levying their price on the people of this country, particularly in the regions.

I thought that the hon. Member for Sunderland, South was rather pathetic when he plaintively said, "Look at all the money we have been spending, where has it gone?" He is the first to recognise that, although the taxpayers' money spent has risen dramatically, it has not caused any proportionate change in the number of jobs available. The jobs available have fallen, although the taxpayers' money spent has increased by several times. It is because we recognise the discrepancy between expenditure and results that we propose a different set of policies from those of the present Government.

Mr. Bagier

Could not a possible explanation be that there has been a tremendous rundown in the number of jobs at the same time as the investment has taken place, and this must show up in the figures?

Sir K. Joseph

That is right, but we faced that, the Government face that and the next Government will face it. The question is, which is the best mix of polices to deal with it?

I will first repeat to the House the firm decisions that the Conservative Party has made and announced. We shall keep the development area boundaries as we find them and we shall keep them unless and until the problems of any particular region are seen to be on the way to solution. Secondly, we shall keep the industrial development certificate system. Thirdly, we shall keep an investments incentive differential in favour of the development areas and of shipbuilding. I am not qualifying these three statements; they are categoric.

Subject to the undertakings already given, we shall phase out the regional employment premium. The hon. Member for Newcastle-upon-Tyne, East made heavy weather of this, and I shall try to deal with each of his points. First, the R.E.P. was always a temporary benefit. It was announced to come to an end in 1974. I have not heard the Government declaring that its temporary nature has been removed and that the benefit is to continue. Perhaps that has been proposed, but I have not heard it and at the moment R.E.P. is temporary. I wish that I could hear an hon. Member opposite muttering "Over my dead body", but I do not think that I do. It was always a temporary benefit and all recipients, presumably, have recognised that they could not count on it for ever.

Dr. Bray

The right hon. Gentleman will recall that income tax was also temporary.

Sir K. Joseph

If the hon. Gentleman thinks that R.E.P. has the staying power of income tax, he had better think again. I am saying on behalf of my party that we intend to phase out R.E.P., subject to taking into account the undertakings which have been given.

If hon. Members opposite say, "What brutes you are!", because shipbuilding and other industries will complain that they cannot continue to receive R.E.P., let me remind them of what their own Government did about the selective employment premium, which had no particularly temporary status about it. It was withdrawn overnight in the sense that the withdrawal was announced a few months ago to take effect from April, this year. Many companies which had taken S.E.P. into account in long-term contracts found that they were not to get it and that their profit margins would, therefore, suffer. We do not intend to make any such abrupt withdrawal. There will be general notice of the phasing out of R.E.P.

Some firms in some industries come perilously close to receiving in R.E.P. something equivalent to their gross profits before taxation. I could happily quote other firms in the same industries whose gross profits before taxation are many times their income from R.E.P. [HON. MEMBERS: "Shipbuilding?"] I could quote several shipbuilding firms whose profits are many times what they get from R.E.P. I am delighted to say that, because I deny what the hon. Member for Newcastle-upon-Tyne, East said about choice before the companies concerned. He said that these companies would have to increase prices, or their profits would vanish. Mercifully, there is a third alternative.

I gladly acknowledge that all shipbuilding companies are struggling to improve their efficiency and their productivity, and the third alternative is for them to be successful in improving their productivity and efficiency. Surely no one on either side of the House believes that it is other than debilitating for industries to make their profits entirely out of what the Government themselves describe as a temporary benefit.

If we have to face the political consequences with which the hon. Member threatened us, there will be another side to the coin. While we shall phase out R.E.P., we shall also bring to an end S.E.T., and for every one who is sad about the end of R.E.P., there will be at least one, if not two, who will rejoice at the end of S.E.T.

The hon. Member asked me how we would end the selective employment tax. I am glad that he acknowledges by that question that selective employment tax has been no friend to the regions. The S.E.T. has robbed the North, as it has robbed all other regions, of jobs, particularly in that area where the North, like all the other regions, is badly off, namely, employment for women. We all know that the activity rate in the North is below the national average. We all know that the effect of the S.E.T. has been to drive out of employment the marginal employees, particularly women, in the growing service trades.

Mr. Arthur Blenkinsop (South Shields)

Is not the right hon. Gentleman aware that it is precisely among women where our problems in the North-East are least? Compared with the enormous need for openings for men we need remarkably few openings for women.

Sir K. Joseph

One of the constant pleas of the Northern Area Economic Development Council is that the activity rate for women should be increased. That does not quarrel with the need for an increase in jobs for men, but let us bring what prosperity we can to the region and not murder it by a discriminating tax like selective employment tax.

I now come to another of the changes which we propose to introduce. We propose to cease to pay automatic invest- ment grants to all capital intensive projects regardless of whether they would have gone to the area concerned without the grant and regardless of the contribution they make to the area. I accept at once that capital intensive projects are very valuable, but the question in our mind is what is the point of spending automatically large sums of taxpayers' money in those instances when a valuable project might, or would have gone to the area anyway.

It is recognised by hon. Members opposite as well as by us that the vast proportion of the investment incentives go to the capital-intensive industries, particularly the chemical and oil industries. These are splendid industries, but is it altogether sensible that regional policy should pay firms to install machinery made outside the regions and which, in effect, will put people in the region out of work? We all welcome an increase in productivity and we all welcome an increase in mechanisation and a movement towards automation, but we do not think that we have actually to bribe firms to do that in the development areas with the taxpayers' money. There are better uses for the taxpayers' money.

Many of the improvements in output per man occur by the competitive process and are due to the general climate of the tax system and the economy as a whole. We shall certainly keep powers that will enable us to attract overseas investment, or other investment, that might or might not come to a particular development area according to whether there is help. We intend to move to a more flexible arrangement. We intend to unshackle ourselves from the automatic nature of the huge taxpayers' grants to capital-intensive projects. In this I would have thought that, in spirit anyway, we were moving in the direction approved by the hon. Member for Middlesbrough, West (Dr. Bray) and the hon. Member for Ashton-under-Lyne (Mr. Sheldon).

We have not yet decided the exact method by which we shall do this, because there is a choice in our minds. We dislike very much giving Ministers discretion over when and where and to what extent to spend taxpayers' money, but we dislike even more the waste of taxpayers' money implicit in the present system. We should probably, therefore, use the Local Employment Acts for the differential investment incentive for the development area, but I say that with the word "probably", because that decision has not yet been finally made. I stress that any changes to the investment incentives will not in any way be retrospective.

Mr. Edward Milne (Blyth)

Does not the right hon. Gentleman realise that his Government neglected investment in the capital-intensive industries? While it is easy now to talk about not giving incentives to capital-intensive industries, it is only by these industries that we are able to attract ancillary industries, which come to the North-East in their wake.

Sir K. Joseph

I do not think that the hon. Gentleman is right. I do not think that there has been any greater proportionate investment in capital-intensive industries while they have been in office than when we were in office. There was a surge of investment in the chemical, oil, steel, and motor industries in our time.

Hon. Members will want to know what we shall do with the savings we make. We shall use part of the aggregate savings made from phasing out R.E.P. and the change in the investment incentive arrangements to accelerate the improvement in communications, infrastructure, and training. Had I more time, I should enlarge upon the importance of training. Hon. Members opposite may say that the present training facilities are ample, and that the trade unions do not stand in the way of the employment of dilutees. I accept that trade union officials do not. It is the shop floor which sometimes stands in the way of the employment of dilutees. I accept that the retraining of adults must present great difficulties, but I ask the Government to accept that many industrialists say that the availability of skilled men is the key to whether they will or will not invest in an area.

We believe that the essential ingredient of regional policy which the Government have undervalued is the importance of improving the environment as a whole. We know that in the mix which the Government have adopted the environment has its place, but, by spending money on R.E.P., and by the wasteful nature of the investment incentive to capital-intensive projects, they are misusing taxpayers' money which would be far better employed in accelerating the improvement to the environment, because the loss of high quality people is as much associated with the depressing environment as with the lack of jobs. We shall therefore use part of the savings for those purposes.

There was a theory among Ministers at one stage that R.E.P. did not really cost the taxpayer money, that it was, as I said in a previous debate, fairy gold, it came from nowhere, and was nice for those who received it. This was based on the belief that, as the money would be spent in a region which was under-employed, it would not really add to the inflationary pressures on the economy, and therefore would not have to be offset by an increase in taxation, or a cut in other Government expenditure. That theory is dead, because the Government were ready to use S.E.P.—which was paid in the same areas on much the same basis—as fairy gold, in hard cash employed, in the grey areas.

I think that that theory is dead, but, if it survives, I claim that our expenditure, our use of part of that saved money on improving the roads, on building houses and schools, on clearing derelict area, and so on, in the regions, will be just as little inflationary as R.E.P., and therefore will, to the extent that this is true of R.E.P., not need to be offset by higher taxation or by cuts in public expenditure, but I must express my own strong reservation about the fairy gold argument as applied to either.

On balance, therefore, while accepting that we and the Labour Party both have something to learn from our experiences in regional policy, we believe that the mix we propose, coupled particularly with the cuts in personal taxation, which will encourage the buoyancy of the economy if balanced by cuts in public expenditure, will be for the benefit of the regions as a whole, including the North.

As the debate is bound to have an element of the polemic about it, I must end my contribution to the debate with one quotation which comes most aptly from today's The Times Business News. In a report on the North-East, the writer, who is not known to me in any way, says: During the 1960s Conservative government's have probably done more for the region than Labour. We neither of us have the right to be content with what we have done. We beg the Government to consider whether they have got the mix of their policies right, because in the plaintive words of the hon. Member for Sunderland, South, though the expenditure has been large, the results have been disastrous.

5.55 p.m.

Mr. E. Fernyhough (Jarrow)

The right hon. Member for Leeds, North-East (Sir K. Joseph) has tried to extract himself from a very difficult position. He has tried to spell out, so that no one in the development areas will be offended, what the Conservative Party hopes to do if ever it gets the chance by becoming the Government.

The thing that struck me about the right hon. Gentleman's speech was his peroration. He talked about infrastructure. I do not know whether the right hon. Gentleman has ever examined the figures. Let him look at the number of houses built in the North-East during the last six years of Tory rule and compare that figure with the number of houses built in the last six years of Labour rule. Let him look at the new roads which have been constructed during the last six years, and compare those with what was planned but never constructed, and therefore never needed a penny, in the days when he was a member of the Government.

The basic truth is that anyone who went to any part of the North-East would think that an atomic bomb had been dropped there. Whether in relation to roads, the clearing of slums, the building of new schools, or the development of city and shopping centres, in almost every part of the North-East there is to be witnessed today that which was never evident before, at least not in my lifetime.

The right hon. Gentleman said that we must all try to learn from our experiences. I shall not quote the right hon. Gentleman, because I think that he has tried to learn. I think that we, too, have something to learn. I think that perhaps we did underestimate the magnitude of the task which needed to be done in the development areas, but I do not believe that anybody could have foreseen the rundown in the mining industry, in agriculture, in marine engineering, and in the railways as a result of Beeching. The North-East has lost more jobs in those four industries than the present total of unemployment. If this unemployment had been similar to unemployment in the past, I do not know how I should have been able to contain myself.

I want hon. Gentlemen opposite—and one or two of them have been here for a long time—to realise that there is a difference between unemployment under this Administration and under any previous one. Unemployment under every previous Administration was accompanied by degrading poverty. If a man had no job, his home and children suffered. There was hardly enough, as it were, to keep body and soul together. I am glad that it was a Labour Government who recognised that if the country was to undergo a second industrial revolution we had to see to it that the victims did not face the same hardships as were faced by those who experienced the first one.

Our redundancy payments and our wage related benefits have removed that aspect of unemployment which brought countless thousands into the Labour movement. In pre-war days, when there were marches and demonstrations by the unemployed, our banners had inscribed across the top, "Work or Maintenance". A civilised society ought to accept that, and this Government have done so. We have acted in a civilised way to those who become the victims of the second industrial revolution. But, given the massive contraction which we have seen in mining, marine engineering, agriculture and the railways, unless one had the powers of a commissar it would have been very difficult to deal with the situation.

Hon. Members opposite who have criticised us should examine the facts. Let them look at the number of i.d.c.s which have been granted in the last six years as against the previous six years. Let them remember, too, that, just as a colliery employing 2,000 people which closes today spent many years building up to that 2,000 level, many new industries starting with 100, 200 or 300 employees will take the best part of a decade to employ the maximum number. It is very much like the man who goes to a new house and sees the garden as the builders have left it. He thinks that, with a little sweat and effort, he can clear the lot in six months. He attacks it with vigour and determination. At the end of six months, all that he has is a heap of stones and brickbats. He found a lot hidden under the surface of which he was not aware. There was a lot hidden in the development areas about which we did not know, especially in the North-East. It was only when we were able to open the files and see the true position that we appreciated the magnitude of the task.

Three years ago, one of my right hon. Friends criticised me somewhat harshly because I said that I thought that it would take a decade for us to make the North-East, Scotland and South Wales equivalent to the rest of the country. Anyone who looks at the infrastructure and the industrial problems there must accept that it will not be possible in a year or two to make Northumberland, Durham and Cumberland the equivalents of Hampshire, Sussex, and so forth. We have paid too big a price for too much being taken out and too little being put in. It is only now, under a Labour Government, that attempts are being made to make amends.

I am as appalled as anyone at the present unemployment situation. I had to answer for it at the Dispatch Box for the best part of three years. I was never very happy about it. Any society which denies a man the dignity and self-respect which come from the ability to earn his living is somewhat uncivilised. It is even more uncivilised if, having put him in that position, it does not maintain him. Despite our mistakes and limitations, we can say truthfully that we have removed the spectre of poverty from the lives of our unemployed. If we have done nothing else in this Parliament, I shall always be proud of that, because it was the failure of previous Governments in this direction which embittered me in my youth.

6.5 p.m.

Mr. Antony Lambton (Berwick-upon-Tweed)

We have listened to the debate so far with great interest, and we are grateful to the hon. Member for Sunderland, South (Mr. Bagier) for bringing the subject before us.

At the outset, I must say that I was a little disappointed with the speech of the hon. Member for Jarrow (Mr. Fernyhough). It seems to me that what we want in the North-East now is new ideas, new plans and new constructions—what the Prime Minister used to call a dynamic approach. It is hardly a dynamic approach or one which will help the area very much to dwell on some of the benefits of unemployment.

The hon. Member for Sunderland, South made a powerful but in some ways curious speech. In the North-East today we have a male rate of unemployment of 7 per cent., which is 1.6 per cent. higher than that of any other area, and a whole rate of unemployment of 5.2 per cent. which is 1 per cent. higher than any other rate in the country.

This is only part of an unfortunate pattern. If we look at what is happening in the North-East, it is clear that not so many houses are being built as were being built. As my hon. Friend the Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) said in a powerful speech, it is clear that there is double taxation, food prices were never higher, and there is the general squeeze. Notwithstanding that, hon. Gentlemen opposite take this as an occasion to congratulate the Government on what they have done in the North-East. That is rather extraordinary.

It was only a month or so ago that the hon. and learned Member for Northampton (Mr. Paget) told the Chancellor of the Exchequer that, whereas politicians are always saying how bad things were in the old days, a lot of people wish that they were back there now when they consider what this Government have done. If we look at what is happening now, where can we see any hopeful signs in the North-East today? Where are the plans to end unemployment?

Mr. Fernyhough

If the hon. Gentleman cannot see the answer in terms of housing, roads, schools, and reclaiming the pit heaps that his forebears left behind, he needs to change his optician.

Mr. Lambton

We are having a constructive debate. A remark to me about the pit heaps which my forebears left behind is typical of the totally unconstructive views put forward by hon. Gentlemen opposite. There is too much talk of 13 years of waste. What is needed in the North-East today is new industries and the dynamism of which the Prime Minister used to talk. It is pointless to dwell upon the benefits of unemployment and to throw cheap insults across the Floor of the House. It is typical of hon. Members opposite that at a time like this they can think of nothing new. Their speeches all dwell on the last nine or 13 wasted years and on what has not been done. Where are the schemes to do away with unemployment? Where are the plans. That is what we want to hear. We are not hearing it. Right hon. and hon. Gentlemen opposite will be judged by what they produce.

Mr. Rhodes

May I remind the hon. Gentleman that I did not refer to the past? I spoke of the regional employment premium policy and its effects on my constituency. Would the hon. Gentleman care to refer to that?

Mr. Lambton

It has been referred to already by my right hon. Friend the Shadow Minister. He answered it fully, and I did not see the hon. Member for Newcastle-upon-Tyne, East (Mr. Rhodes) challenge his answer.

Mr. Rhodes

Because it was so disgraceful.

Mr. Lambton

Let me refer to one island of prosperity in the whole North-East. I mean the situation in Washington new town. When we had a similar debate a few months ago, I made some criticisms of the very large-scale development in Washington new town compared with the industry not being brought to neighbouring areas like Sunderland. This called forth a rather sharp response from the Chairman of Washington new town, Sir James Steel, who seemed to disagree rather with what I had said.

No one has a greater admiration for Sir James Steel than I have. He is a first-class executive in every sense of the word, and anyone who has seen anything of Washington new town can only be impressed by all he has done. Yet there are certain questions about the kind of industry going to Washington new town that are relevant to the whole situation in the North-East. How many people will be employed by the end of 1971 in the industries now being built in the new town? What will be the population of the new town then? A large number of industries are springing up there, and it seems to me that they will be filled with people from the neighbouring towns—from Sunderland, Chester-le-Street and Birtley—which are not being given any really new industries. The area is being starved for Washington.

This being so, what will happen in Washington when the housing catches up and people come in to take the jobs now filled by those coming from Sunderland? Is this problem being carefully considered? What is the number of people that it is proposed shall eventually be employed in the industries in the new town? What will be the town's population? Is it wise that there should be a pressing ahead with housing in Washington if it means taking away jobs from people in Sunderland and the other surrounding towns?

Has the development of Washington new town been thought of within the context of the whole area? It would be a great pity if people from the neighbouring towns became accustomed to coming into Washington for a number of years, so that industries were not brought to them, and then gradually, as the new town grew and people were brought into the area, the old locals were left out of a job in the neighbourhood. I would very much like the Minister of State to go into this subject.

The time has come when the industrial development of the new town should be carefully related to the number of people in it and to the building of new houses. I can only repeat that what I say is in no way critical of the efficiency of the chairman of the new town. Perhaps he is too successful in doing this job in the context of the area as a whole.

I did not want to be contentious at the beginning. What we all want on both sides of the House is to see an end to the high rate of unemployment in the North-East, to see more industries brought to the area and not to see the area suffering compared with the rest of the country, as it did in the past. These are the things we should be concentrating our minds on rather than dwelling on the past, which will get us nowhere.

6.14 p.m.

Mr. Ron Lewis (Carlisle)

I congratulate my hon. Friend the Member for Sunderland, South (Mr. Bagier) on initiating yet another debate on the whole question of the Northern Region. I was a little disappointed with the hon. Member for Berwick-upon-Tweed (Mr. Lambton), because he fell into the trap a number of speakers from both sides of the House fell into of talking about the North-East in particular when we are discussing the North in general. I remind the House that the Northern Region stretches from one coast of England right across to the other.

I come from an area which has known the spectre and shadow of unemployment for over 40 years. I refer to West Cumberland. In the short time that I have I wish to deal exclusively with the part of the Northern Region that is well known to me.

We in Carlisle and Cumberland have much for which to be grateful to the Labour Government and the policies that they have pursued in our part of the country. At long last we are beginning to see tangible results. The county of Cumberland and its capital city form a very scattered community with long lines of communication. We are geographically somewhat remote, but we are still part and parcel of the Northern Region, and our people in the North-West are as important as those in the North-East.

It is pleasing to note that for the past five years we have not been overlooked. Our position was such before 1964 that but for the Labour Government our area would have become derelict, because we suffered from intense unemployment, particularly in West Cumberland. Our prospects today are very bright. I am one of those who hold the view that as a result of the policies pursued during the past five years the position in my part of the country will have changed considerably in less than two years from now. New industries are beginning to take shape, bringing employment for our people and with it a rising standard of living.

It was under the present Government that the training centre was built at Maryport, bringing with it new skills and training for our people. My only regret is that up to a short time ago it was not fully used; I gather that it could take still more people.

But for the Labour Government, I believe that Cumberland industry would have been written off. Here I would like to pay my tribute to my right hon. Friend the Member for Newton (Mr. Frederick Lee) who was the first "Minister for the North". The Opposition classed his appointment as a gimmick, but I am convinced that during his short stay in that job he did a wonderful job for Cumberland in particular. I can only hope that my hon. Friend the Minister of State will continue the good work my right hon. Friend started, and I am sure that he will.

The question every elector in my part of the country will have to ask at the coming General Election is whether to carry on with the Labour Government's policies or to follow the policies outlined by the Conservatives, which I gather would stop cash grants coming to areas like Cumberland.

It has been said that we have thrown money down the drain. This is not the case so far as my people in Cumberland are concerned because we are now beginning to see the results of five years' work. In my constituency alone new industries have been brought to the city, bringing not only employment and competition but also more rateable value and capital. We have new factories like Pirelli's, which is employing a large number of people; we have Courtaulds coming to Carlisle. I am told that the question of trying to obtain female employment in my part of the area is getting rather desperate. Therefore, we have much for which to be grateful to this Government. New roads are in the course of construction, and the Carlisle by-pass should be open towards the end of this year. A start has been made with the inner ring road of my city.

However, one of the desperate problems is that of housing, both for general needs and also for industrial purposes. It has been the Tory-controlled council which has failed to deliver the goods, because it has not taken any initiative in attempting until lately to build houses. I can only hope that, in view of the urgent need for skilled labour in my part of the area, the local authorities, the industrialists and also the Government will get together in an attempt to iron out the needs because of our desperate housing shortage.

Then there is the question of very small firms employing only a handful of people. I gather that at the moment it is almost impossible for small firms to get grants. We have these small firms scattered throughout the county of Cumberland. I hope that in future some consideration will be given to these because of the large number of small firms which we have in our area. Grants which we have received so far have been of great advantage to Carlisle and Cumberland, but we still have a long way to go.

For some time now we have been trying to establish an airport. Some £50,000 has been spent to date. As air transport will be one of the main modes of transport in future I can only hope that this Government will help us all they can, not only in retaining our airport but also in expanding it to meet the needs of the late 'seventies and the 'eighties.

I was particularly delighted with the statement made today by my right hon. Friend the Minister of Transport regarding electrification from Weaver Junction onwards to Scotland. This will be a boon to my part of the country, not only passenger-wise but also for the transport of goods. I hope that this great project will be proceeded with as quickly as possible. I am a railwayman and I declare my interest, but I hope that, in that vast contract which will be undertaken, British Railways themselves will be given an opportunity of showing their skill and of helping with this great undertaking.

I make no apology for referring to my constituency because, if I cannot refer to it here, I ought not to be in this House, but I am particularly concerned about some of the school buildings in my area, in particular some of our infants' schools, and also some of our primary schools, which were built years and years ago. I refer to Bishop Goodwin Infants' School, Upperby Primary School, Stanwix Primary School and Petterill Bank Primary School. All these schools need replacing, and I hope that my right hon. Friend will look very favourably at these projects the next time he is looking at this aspect of his policy. Likewise, the Newman Roman Catholic comprehensive school; even now additional accommodation is needed to meet the needs of the Catholics' children. I visualise that, if we are not careful, some of the schools in my area will be overcrowded by between 8 per cent. to 10 per cent.—not a very good prospect.

One other matter concerns at least one part of Cumberland. I am told that there is likely to be a water shortage in west Cumberland. I am informed that every effort is being made to overcome this difficulty, as is absolutely essential because of the new industry which is now coming to Cumberland, the great new project of the bus company in consultation with Lord Stokes's company. My right hon. Friend the Prime Minister only on Friday last started it running. For that, too, we are very grateful to this Government. I hope that this water shortage will at least be looked at so that, in the not too distant future, that problem will be solved.

Finally, I should like to make one more reference to the Solway barrage. The Solway barrage has been under review for some considerable time. To my part of the country, it is a vital matter, and I can only hope that the rumour which has now emanated to my part of the county, that the Solway barrage project is likely to be completely abandoned, is false. I am hoping that my hon. Friend will have another look at this today. Not only that, but I hope that, as Minister responsible for the North, he will initiate a public inquiry, so that every matter associated with the Solway barrage can be brought out and we can see the facts for ourselves. I hope my hon. Friend will look at that matter.

Isolated though we are, we in our part of the country have a lot to be grateful for, and I can only hope that the wonderful work which has been started during the last four and a half years, after so much talk, will continue during the years ahead.

6.29 p.m.

The Minister of State (Mr. T. W. Urwin)

The Motion congratulates the Government on pursuing policies aimed at assisting the Northern development area and invites the House to take note of the grave threat which the Selsdon Park proposals pose for that area. I am grateful to my hon. Friend the Member for Sunderland, South (Mr. Bagier) for raising these issues, although I trust that he and other hon. Gentlemen will forgive me if I begin by generalising.

This provides me with a further opportunity to remind the House that the Labour Government have laid great emphasis on the pursuit of a positive regional policy. They have done so not simply because such a policy makes good sense from a national economic point of view but also because they believe that there are powerful reasons of social justice for seeking to correct the imbalance between the more and the less prosperous areas of the country. It is because of the importance attached to regional development that I have listened most attentively to hon. Members opposite to hear what it is they find wrong with what we are doing and what they want to put in its place.

There has certainly been much criticism, some of it conflicting. Some members of the Opposition seem to think we do too much, others that we do not do enough, but I must confess that I am still in the dark about what the Opposition really do propose as complete alternative regional policy. There has been a good deal of vageness even in what has been said in this short debate. Of course, I suppose it is a bit too much to expect a coherent policy to emerge from hon. Members on the back benches opposite when, it is apparent, there are fundamental disagreements on the Opposition Front Bench. But, if we are to discuss these important issues intelligently, it is no use the Opposition trying to face all ways at once.

Reference has been made to a more selective application of Government policies. If hon. Members want more selectivity based not in areas but on individual firms, as I understood the right hon. Member for Leeds, North-East (Sir K. Joseph) to say, we need a further explanation of on what basis selective assistance can be given and how it can be given fairly promptly and in a way which will ensure that industry can take decisions without wondering whether particular projects are to be assisted or not. If they want more infrastructure, nearly all of which would be very costly, what are their priorities and how do they match the savings which they say could be made in assistance to industry? It is no good talking about more infrastructure generally: more infrastructure involves investment projects in particular parts of the country. To what projects would the Opposition give first priority?

Mr. Nicholas Ridley (Cirencester and Tewkesbury)

The hon. Gentleman is trying, rather heavily, to twit my right hon. Friend for not giving specific policies, down to the crossing of the last "t" and the dotting of the last "i". Does he recall that his Government never even announced before the 1964 General Election that they would institute 40 per cent. investment grants and a regional employment premium?

Mr. Urwin

I was not accusing the right hon. Gentleman of not crossing t's and dotting i's. As a result of the constructive proposals and questions put by my hon. Friends, I had expected that he would be more explicit than he was.

In the complete absence of a coherent Opposition policy, I can only deal with the isolated propositions that have been aired. It has been suggested that the Government would do better to spend less money on financial inducements paid directly to industry in the development and intermediate areas and more money on improving infrastructure. I do not dispute that improvements in communications and other forms of infrastructure are an important means of enabling industry to operate with full efficiency in the assisted areas. Infrastructure improvements are thus an essential element in regional policy: but the need for better infrastructure is not confined to the development and intermediate areas.

When infrastructure is discussed, many people think first of roads. We need new roads to get raw materials into and finished products out of the development areas: but this need has to compete with the need for improved roads in, say the South-East and the Midlands to carry exports from the factory to the port. One point which the Conservatives might remember if they want to win the next Election is that far more money is being spent in the Northern Region on road construction than ever before.

The Government do not take the view that there is never a case for bringing forward infrastructure programmes in order to stimulate regional growth. The Industrial Development Act 1966 and the Local Employment Bill which we have recently been debating provide for the improvement of infrastructure, as regards both basic services and the clearance of dereliction, in order to promote industrial development, and I would remind the House that the Government have brought forward specific projects to aid regional development, for example, the building of a bridge across the Humber estuary. It will be of vital importance to the economic growth and development of that very large area. It is easy to be dogmatic in this field and to take up extreme positions, but to my mind the Government's view is the only sensible one; namely, that financial inducements to industry and improvements in infrastructure both have an important role to play in stimulating industrial growth.

Then there have been criticisms of the cost of investment grants. If we compare the cost of the present investment grant scheme and the associated capital allowances with the whole of the previous system of capital allowances and local employment grants, it is expected that over a period the present system will cost much the same as the previous system would have cost had it continued. The difference is that the cost of incentives is, with investment grants, unlike investment allowances, clear for all to see. Do the Opposition believe that it is wrong to know exactly what we, as a nation, are spending our money on?

Mr. Ridley

This argument is bunkum. Does not the hon. Gentleman realise that investment grants go to private companies which are not earning profits and that, therefore, the total amount received would be very much less, because unprofitable industries would not be receiving it? Would he not please take that into account before making such silly statements?

Mr. Urwin

I am not making any silly statements. I have said that the cost would be no different over an accounting period if we reverted to the system which the hon. Gentleman mentions. More important, it is urgently necessary for the system to continue in the development areas to provide much-needed new employment opportunities.

We have had the usual misunderstanding about relating the payment of investment grants to such criteria as the number of jobs provided. It has not been insisted upon in this debate as much as it has on previous occasions but the hon. Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) raised the cry which is heard loudest of all, that of "selectivity". This is raised by those who are first to criticise what they see as Government intervention in the free choice of industry. Selectivity is an important question, and since the Opposition attach so much importance to it, I should like to deal with it for a moment.

As with so many cures prescribed for regional ills, the name of the medicine is bandied about without any real attempt to analyse the contents of the bottle. Hon. Gentlemen opposite call for greater "selectivity" in assistance to industry as an element of regional policy—this point was made again today in relation to investment grants—yet we are still awaiting for a reasoned statement of the problem from them.

It is argued that investment grants should be selective in the sense that they should not be paid to projects which do not create a certain number of new jobs. But, as I have explained on many occasions, the purpose of investment grants is not just to create new employment in development areas; it is to stimulate investment there, particularly investment in modern science-based industries, much of which is capital intensive, to replace the traditional industries whose decline is largely responsible for the difficulties of the development areas.

Have hon. Gentlemen opposite thought how grants for plant and machinery could, on a selective basis, be linked to a particular number of jobs? What number of jobs does one estimate for a firm's purchase of, say, fork lift trucks, a conveyor belt or replacement machine tools? Also do hon. Gentlemen opposite want the level of grant related to the quality of job created—so much for unskilled jobs and more for jobs of higher skill? If so, perhaps they will explain how this would be assessed and administered. They made no attempt to explain it today.

We hear that investment grants should not be automatic but they should be paid for projects of "particular value" to the development areas. But hon. Gentlemen opposite have still to tell us how they would define "particular value". Do they mean that special assistance should be given to a particular firm because the Government believe that its product will have especially good export prospects? Which of us could confidently predict that the new products of one firm have better export prospects than the products of another? Also, what of special assistance for firms in development areas which make components that go into products exported by other firms, or machinery for their use? Is the production of such firms of "particular value" and, therefore, to be given the "selective assistance" advocated by hon. Gentlemen opposite?

Criticism is often made in this House and elsewhere that, even with the greater predictability of the assistance administered by the Government, firms too often find it difficult to predict exactly what support their projects will attract. We recognise that there is a problem here, and we do our best to create a climate, where Government action is concerned, in which industry can make informed investment appraisals. But with the "selective" assistance advocated by the Opposition, apparently without "ground rules", industry could rightly complain that investment appraisal was likely to be as scientific as assessing prospects for an evening's bingo.

Since selective assistance would mean that millions of individual applications for assistance would have to be examined in detail each year, and in a vast number of cases discussed with the firms applying for selective assistance, are hon. Gentlemen opposite also saying that this could be done without a major increase in the size of the Civil Service?

I am certainly not saying that there is no scope for a more selective form of assistance to industry. We must—and do—watch the operation of our policies closely to be as sure as we can that we get value for money, and we are always ready to consider new ways of getting better value for money. But it is no use hon. Gentlemen opposite talking vaguely of "selectivity" without concrete proposals which can be examined in depth. So far no such proposals have come from the party opposite.

But there is an aspect in all of this that I would most seriously ask the House, and especially hon. Gentlemen opposite, to take into account. The present Government have, in their regional policy, recognised the difficulties which frequent changes in the pattern of assistance cause to firms when they want to make investment decisions. This was one of the reasons which led us to abandon the development district concept, since industry could have no confidence that particular places would not be struck off the list with very little ceremony.

It was with such considerations in mind, too, that we stressed our intention of continuing payments to firms receiving R.E.P. at the present level for not less than seven years. I believe that every industrialist would agree that our policy of maintaining as steady an investment environment as possible is the right one. But now industry is being subjected to a good deal of unconstructive criticism and a stream of shadowy propositions—I cannot call them anything more substantial. The effect of this on industry must be unsettling. My complaint against hon. Gentlemen opposite is not that they have different views from ours; it is that they have no views at all. We would welcome serious discussion of these very important issues, but there can be no informed debate when one of the sides has no opinions to offer.

The right hon. Member for Leeds, North-East said that R.E.P. would be phased out. In the unfortunate and unlikely event of the Conservatives winning the next election, we gather that that would be their policy. I take it that the right hon. Gentleman appreciates the serious damage that he is doing to the confidence of investors in the development areas. For example, he has not said whether the assurance that we have given about R.E.P. being paid for seven years up to 1974 will continue, or whether it will be phased out immediately after the election if the Conservatives take office.

Sir K. Joseph

We have said consistently that we will phase out R.E.P., taking into account the undertakings that have been given. Would the hon. Gentleman say whether the Government propose to make R.E.P. permanent.

Mr. Urwin

We have given an assurance that R.E.P. will be paid for seven years and we have said both inside and outside the House that all aspects of regional policy are subject to continual review. We have kept our promises to the coal mining industry, which the Conservatives did nothing to help, and we would like to know whether they would continue the special measures to aid displaced miners beyond 1971, as we propose.

Mr. Michael Shaw (Scarborough and Whitby) rose—

Mr. Urwin

I have much to say and little time in which to say it.

Mr. Shaw

I have been trying to intervene for a long time.

Mr. Urwin

I regret that I cannot give way any further.

S.E.T. has been mentioned by a number of hon. Members as one of the causes of unemployment in the Northern Region. The right hon. Member for Leeds, North-East mentioned it and said that he would deal with the subject, but he did not. My hon. Friend the Member for Sunderland, South referred to S.E.T. as having been one of the items discussed at the Selsdon Park conference, that so-called great policy-making discussion of the Conservatives which sparked off general election talk much sooner than it would otherwise have arisen.

One of the few unambiguous comments made by hon. Gentlemen opposite has been in connection with their decision to abolish S.E.T., but the right hon. Member for Leeds, North-East was coy about what he would put in its place. Hon. Gentlemen opposite say that they are considering a broad-based tax such as a value-added tax, but they will not bring in £600 million a year merely by contemplation.

Hon. Members opposite say there would be wide exemptions for food and other essentials. But a tax of this kind would still cover a much wider range of goods and services than S.E.T., and would, therefore, be much more far-reaching in its effects. Nor has there been any suggestion so far that a value-added tax would be varied regionally any more than S.E.T., so I do not see that there would be any advantage from a regional point of view.

I quite understand that a tax which is designed to transfer labour from services and construction to manufacturing must seem less relevant in areas where there is already high unemployment. Hon. Members have suggested that the position would be greatly improved if there could be special relief for particular industries and particular areas. There are two points I would like to make about that.

First, I should point out that anyone who suggests a new boundary, whether physical or industrial, has to be able to justify it to those who are on the wrong side. If there should be relief for the construction industry, one has to be able to justify restricting to that industry—and to the Northern development area. If construction, then why not consulting engineers; and if consulting engineers, why not accountants, and so on? Similarly, if relief is to be given to the Northern development area, what about the other development areas? In the end, one comes down to, at the very least, complete relief from S.E.T. in the development areas, at a cost of something like £120 million a year.

My second point is that, whilst hon. Members opposite are very keen on the idea of cost-effectiveness in public expenditure, they do not seem to be so rigorous when it comes to reducing taxation. But there is really very little difference. Giving away £120 million in tax relief would have to be financed by increases in other taxes, just as an increase in expenditure would. Also if we thought it necessary to spend another £120 million on help for the development areas, relief from S.E.T. certainly would not be the most cost-effective way of doing it. Unlike manufacturing industry, services cater mainly for a local market. Relief from S.E.T. would, therefore, not help services in the development areas to increase their share of the national market in the way that R.E.P. helps manufacturing industry.

I have so far spoken mainly in broad terms, and this is right, as the implications of the issues raised are by no means confined to the North, but I now turn to the particular case of the North.

Some of the benefits accruing to the Northern Region as a result of the present balanced and flexible measures of assistance have been mentioned in the debate. It is difficult to believe that any Member on either side can reasonably be in doubt about the solid advantages that Government policy has already brought, and will increasingly bring, to the area, and about the extent to which the foundations of a new diversified, industrial structure, are being laid through direct incentives to industrial development, through other forms of assistance to older industry and through the outstanding incresase in public expenditure on new building—roads, housing, schools—since 1965–66.

I remind hon. Members opposite, when they are talking about the Hailsham programme of 1963–64, that public investment in new construction has risen since that time throughout the nation by 97.1 per cent., but it has risen in the northern region by 142.5 per cent. That is a dramatic increase—

Mr. Elliott rose—

Mr. Urwin

—in what the—

Hon. Members

Give way.

Mr. Speaker

Order. Noise never makes an hon. Member give way.

Mr. Elliott rose—

Mr. Speaker

Order. The hon. Member for Newcastle upon Tyne, North (Mr. R. W. Elliott) must keep his seat.

Mr. Urwin

When the right hon. Gentleman and his hon. Friends opposite talk about what they have done for the Northern Region, I must say that anything they did was very much belated. All these problems were seen to be arising long before 1964, and the right hon. Gentleman is very wrong when he says that job loss in the coalmining industry was at its peak in 1964. There has never before been such a dramatic rundown in employment opportunities in the country as a whole as there is at this time, and the right hon. and learned Member for St. Marylebone (Mr. Hogg) came rather belatedly to the Northern Region to try to resolve the problem.

The hon. Member for Berwick-upon-Tweed (Mr. Lambton) talked about the necessity to spend more on the clearance of dereliction in order to improve the environment in the Northern Region. I would remind the hon. Member that throughout the period 1951–59 the Conservative Government withdrew completely all grants to local authorities for the clearance of dereliction.

Mr. Lambton

I never mentioned this subject.

Mr. Urwin

The hon. Member talked about improving the environment, and my hon. Friend the Member for Jarrow (Mr. Fernyhough) challenged him. I am repeating for the benefit of the House that in the period 1951–59 the Conservative Government paid out not one penny of grant to local authorities for clearance of dereliction. At least the right hon. Member for Leeds, North-East nods his head in agreement. Again, there has been a dramatic increase in the amount spent in the Northern Region with the co-operation of quite a large number of local authorities in this important clearing of derelict land.

I rehearsed most of these details when replying to the debate on a Motion proposed by my hon. Friend the Member for Consett (Mr. David Watkins) on 1st December. It should not have been necessary to remind hon. Gentlemen of them, as I am sure that I then referred to the same facts.

Job creation is a continuing process and estimates of jobs arising in the region are regularly revised. There are currently 43,300 jobs—over 30,000 of them for men—estimated to arise over the next four years, and this is ample testimony to the valuable results being obtained by Government policies, against all the stagnation for which hon. and right hon. Gentlemen opposite were responsible.

The hon. Member for Newcastle-upon-Tyne, North talks about the "pipeline". I have never used that word. I refer to jobs in prospect. It is the Northern Echo, to which the hon. Gentleman refers, which talked about the myth of the pipeline. The right hon. Members for Bexley (Mr. Heath) and Leeds, North-East, and every right hon. Gentleman opposite who has ever done the kind of job for which I now have some responsibility, have talked in terms of jobs in the pipeline, but every job that has now materialised was at some time or other a job in the pipeline. The extent to which the industrial basis is being broadened in the Northern Region is plain to see, and I

ask my colleagues to reject the Motion—I mean, accept the Motion.

Question put:—

The House divided: Ayes 284, Noes, 146.

Division No. 70.]	AYES	[7.0 p.m.
Abse, Leo	Eadie, Alex	Latham, Arthur
Allaun, Frank (Salford, E.)	Ellis, John	Lawson, George
Alldritt, Walter	English, Michael	Ledger, Ron
Allen, Scholefield	Ennals, David	Lee, Rt. Hn. Frederick (Newton)
Anderson, Donald	Evans, Albert (Islington, S.W.)	Lee, Rt. Hn. Jennie (Cannock)
Archer, Peter (R'wley Regis & Tipt'n)	Evans, Fred (Caerphilly)	Lever, Rt. Hn. Harold (Cheetham)
Armstrong, Ernest	Evans, Ioan L. (Birm'h'm, Yardley)	Lewis, Arthur (W. Ham, N.)
Ashley, Jack	Faulds, Andrew	Lewis, Ron (Carlisle)
Ashton, Joe (Bassetlaw)	Fernyhough, E.	Lipton, Marcus
Atkins, Ronald (Preston, N.)	Finch, Harold	Lomas, Kenneth
Atkinson, Norman (Tottenham)	Fitch, Alan (Wigan)	Loughlin, Charles
Bacon, Rt. Hn. Alice	Fletcher, Rt. Hn. Sir Eric(Islington, E.)	Luard, Evan
Bagier, Gordon A. T.	Fletcher, Raymond (Ilkeston)	Lyon, Alexander W. (York)
Barnes, Michael	Fletcher, Ted (Darlington)	Mabon, Dr. J. Dickson
Barnett, Joel	Foley, Maurice	McBride, Neil
Baxter, William	Foot, Rt. Hn. Sir Dingle (Ipswich)	McCann, John
Beaney, Alan	Foot, Michael (Ebbw Vale)	MacColl, James
Bence, Cyril	Ford, Ben	MacDermot, Niall
Benn, Rt. Hn. Anthony Wedgwood	Fowler, Gerry	Macdonald, A. H.
Bennett, James (G'gow, Bridgeton)	Fraser, John (Norwood)	McElhone, Frank
Bidwell, Sydney	Freeson, Reginald	McGuire, Michael
Binns, John	Gardner, Tony
Bishop, E. S.	Garrett, W. E.	McKay, Mrs. Margaret
Blackburn, F.	Ginsburg, David	Mackenzie, Gregor (Rutherglen)
Blenkinsop, Arthur	Golding, John	Mackie, John
Booth, Albert	Gordon Walker, Rt. Hn. P. C.	Mackintosh, John P.
Boston, Terence	Gray, Dr. Hugh (Yarmouth)	Maclennan, Robert
Bottomley, Rt. Hn. Arthur	Greenwood, Rt. Hn. Anthony	MacMillan, Malcolm (Western Isles)
Boyden, James	Gregory, Arnold	McMillan, Tom (Glasgow, C.)
Bradley, Tom	Grey, Charles (Durham)	McNamara, J, Kevin
Bray, Dr. Jeremy	Griffiths, Eddie (Brightside)	MacPherson, Malcolm
Brooks, Edwin	Gunter, Rt. Hn. R. J.	Mahon, Peter (Preston, S.)
Broughton, Sir Alfred	Hamilton, James (Bothwell)	Mallalieu, E. L. (Brigg)
Brown, Rt. Hn. George (Belper)	Hamilton, William (Fife, W.)	Mallalieu, J.P.W. (Huddersfield, E.)
Brown, Hugh D. (G'gow, Provan)	Hannan, William	Mapp, Charles
Brown, Bob (N'c'tle-upon-Tyne, W.)	Harper, Joseph	Marks, Kenneth
Brown, R. W. (Shoreditch & F'bury)	Harrison, Walter (Wakefield)	Marquand, David
Buchan, Norman	Haseldine, Norman	Marsh, Rt. Hn. Richard
Buchanan, Richard (G'gow, Sp'burn)	Hazell, Bert	Mason, Rt. Hn. Roy
Butler, Herbert (Hackney, C.)	Healey, Rt. Hn. Denis	Maxwell, Robert
Callaghan, Rt. Hn. James	Heffer, Eric S.	Mellish, Rt. Hn. Robert
Carmichael, Neil	Henig, Stanley	Mendelson, John
Carter-Jones, Lewis	Herbison, Rt. Hn. Margaret	Mikardo, Ian
Castle, Rt. Hn. Barbara	Hilton, W. S.	Millan, Bruce
Chapman, Donald	Hobden, Dennis	Miller, Dr. M. S.
Coe, Denis	Hooley, Frank	Milne, Edward (Blyth)
Coleman, Donald	Horner, John	Molloy, William
Conlan, Bernard	Houghton, Rt. Hn. Douglas	Morgan, Elystan (Cardiganshire)
Corbet, Mrs. Freda	Howarth, Robert (Bolton, E.)	Morris, Charles R. (Openshaw)
Craddock, George (Bradford, S.)	Howell, Denis (Small Heath)	Morris, John (Aberavon)
Cronin, John	Howie, W.	Moyle, Roland
Crossman, Rt. Hn. Richard	Hoy, Rt. Hn. James	Mulley, Rt. Hn. Frederick
Dalyell, Tam	Hughes, Rt. Hn. Cledwyn (Anglesey)	Murray, Albert
Darling, Rt. Hn. George	Hughes, Hector (Aberdeen, N.)	Newens, Stan
Davidson, Arthur (Accrington)	Hunter, Adam	Norwood, Christopher
Davies, G. Elfed (Rhondda, E.)	Hynd, John	Ogden, Eric
Davies, Dr. Ernest (Stretford)	Irvine, Rt. Hn. Sir Arthur	O'Halloran, Michael
Davies, Rt. Hn. Harold (Leek)	Jackson, Peter M. (High Peak)	O'Malley, Brian
Davies, Ifor (Gower)	Jay, Rt. Hn. Douglas	Oram, Bert
Davies, S. 0. (Merthyr)	Jeger, George (Goole)	Orbach, Maurice
de Freitas, Rt. Hn. Sir Geoffrey	Jeger, Mrs. Lena (H'b'n & St. P'cras, S.)	Orme, Stanley
Delargy, H. J.	Jenkins, Hugh (Putney)	Oswald, Thomas
Dell, Rt. Hn. Edmund	Jenkins, Rt. Hn. Roy (Stechford)	Padley, Walter
Dempsey, James	Johnson, Carol (Lewisham, S.)	Paget, R. T.
Dewar, Donald	Johnson, James (K'ston-on-Hull, W.)	Palmer, Arthur
Diamond, Rt. Hn. John	Jones, Rt. Hn. Sir Elwyn (W.Ham, S.)	Pannell, Rt. Hn. Charles
Dickens, James	Jones, J. Idwal (Wrexham)	Park, Trevor
Doig, Peter	Jones, T. Alec (Rhondda, West)	Parker, John (Dagenham)
Driberg, Tom	Kelley, Richard	Pearson, Arthur (Pontypridd)
Dunn, James A.	Kenyon, Clifford	Peart, Rt. Hn. Fred
Dunnett, Jack	Kerr, Mrs. Anne (R'ter & Chatham)	Pentland, Norman
Dunwoody, Mrs. Gwyneth (Exeter)	Kerr, Dr. David (W'worth, Central)	Perry, Ernest G. (Battersea, S.)
Dunwoody, Dr. John (F'th & C'b'e)	Kerr, Russell (Feltham)	Perry, George H. (Nottingham, S.)
Prentice, Ht. Hn. Reg.	Shore, Rt. Hn. Peter (Stepney)	Wallace, George
Price, Christopher (Perry Barr)	Short, Rt. Hn. Edward (N'c'tle-u-Tyne)	Watkins, David (Consett)
Price, Thomas (Westhoughton)	Short, Mrs. Renée (W'hampton, N.E.)	Weitzman, David
Price, William (Rugby)	Silkin, Rt. Hn. John (Deptford)	Wellbeloved, James
Probert, Arthur	Silkin, Hn. S. C. (Dulwich)	Wells, William (Walsall, N.)
Randall, Harry	Silverman, Julius	Whitaker, Ben
Rankin, John	Skeffington, Arthur	White, Mrs. Eirene
Rees, Merlyn	Slater, Joseph	Whitlock, William
Rhodes, Geoffrey	Snow, Julian	Wilkins, W. A.
Richard, Ivor	Spriggs, Leslie	Williams, Alan (Swansea, W.)
Roberts, Albert (Normanton)	Steele, Thomas (Dunbartonshire, W.)	Williams, Alan Lee (Hornchurch)
Roberts, Rt. Hn. Goronwy	Storehouse, Rt. Hn. John	Williams, Clifford (Abertillery)
		Williams, Mrs. Shirley (Hitchin)
Roberts, Gwilym (Bedfordshire, S.)	Summerskill, Hn. Dr. Shirley	Willis, Rt. Hn. George
Robertson, John (Paisley)	Taverne, Dick	Wilson, Rt. Hn. Harold (Huyton)
Rodgers, William (Stockton)	Thomas, Rt. Hn. George	Wilson, William (Coventry, S.)
Roebuck, Roy	Thomson, Rt. Hn. George	Winnick, David
Rose, Paul	Tinn, James	Woodburn, Rt. Hn. A.
Ross, Rt. Hn. William	Tuck, Raphael	Woof, Robert
Rowlands, E.	Urwin, T. W.	Wyatt, Woodrow
Ryan, John	Varley, Eric G.
Shaw, Arnold (Ilford, S.)	Wainwright, Edwin (Dearne Valley)	TELLERS FOR THE AYES:
Sheldon, Robert	Walden, Brian (All Saints)	Mr. William Hamling and
Shinwell, Rt. Hn. E.	Walker, Harold (Doncaster)	Mr. R. F. H. Dobson.
NOES
Allason, James (Hemel Hempstead)	Grieve, Percy	Orr-Ewing, Sir Ian
Amery, Rt. Hn. Julian	Grimond Rt. Hn. J.	Page, Graham (Crosby)
Astor, John	Hamilton, Lord (Fermanagh)	Page, John (Harrow, W.)
Atkins, Humphrey (M't'n & M'd'n)	Hamilton, Michael (Salisbury)	Peel, John
Balniel, Lord	Harris, Reader (Heston)	Percival, Ian
Beamish, Col. Sir Tufton	Harvey, Sir Arthur Vere	Peyton, John
Bennett, Sir Frederic (Torquay)	Hastings, Stephen	Pink, R. Bonner
Bennett, Dr. Reginald (Gos. & Fhm)	Hawkins, Paul	Prior, J. M. L.
Birch, Rt. Hn. Nigel	Heald, Rt. Hn. Sir Lionel	Pym, Francis
Boardman, Tom (Leicester, S.W.)	Heath, Rt. Hn. Edward	Quennell, Miss J. M.
Boyd-Carpenter, Rt. Hn. John	Hogg, Rt. Hn. Quintin	Rawlinson, Rt. Hn. Sir Peter
Brinton, Sir Tatton	Holland, Philip	Rees-Davies, W. R.
Bruce-Gardyne, J.	Hordern, Peter	Renton, Rt. Hn. Sir David
Buck, Antony (Colchester)	Hunt, John	Rhys Williams, Sir Brandon
Bullus, Sir Eric	Hutchison, Michael Clark	Ridley, Hn. Nicholas
Burden, F. A.	Irvine, Bryant Godman (Rye)	Rippon, Rt. Hn. Geoffrey
Campbell, B. (Oldham, W.)	Joseph, Rt. Hn. Sir Keith	Rossi, Hugh (Hornsey)
Campbell, Gordon (Moray & Nairn)	Kershaw, Anthony	Royle, Anthony
Carr, Rt. Hn. Robert	Kitson, Timothy	Russell, Sir Ronald
Clark, Henry	Knight, Mrs. Jill	St. John-Stevas, Norman
Clegg, Walter	Lambton, Antony	Scott, Nicholas
Costain, A. P.	Lane, David	Scott-Hopkins, James
Craddock, Sir Beresford (Spelthorne)	Langford-Holt, Sir John	Sharples, Richard
Crowder, F. P.	Legge-Bourke, Sir Harry	Smith, Dudley (W'wick & L'mington)
Cunningham, Sir Knox	Longden, Gilbert	Speed, Keith
Dalkeith, Earl of	Lubbock, Eric	Steel, David (Roxburgh)
d'Avigdor-Goldsmid, Sir Henry	McAdden, Sir Stephen	Stodart, Anthony
Dean, Paul	MacArthur, Ian	Taylor, Sir Charles (Eastbourne)
Digby, Simon Wingfield	Mackenzie, Alasdair (Ross & Crom'ty)	Temple, John M.
Dodds-Parker, Douglas	Macleod, Rt. Hn. Iain	Thatcher, Mrs. Margaret
Doughty, Charles	Macmillan, Maurice (Farnham)	Thorpe, Rt. Hn. Jeremy
Drayson, G. B.	Maginnis, John E.	Turton, Rt. Hn. R. H.
du Cann, Rt. Hn. Edward	Maude, Angus	van Straubenzee, W. R.
Eden, Sir John	Maudling, Rt. Hn. Reginald	Walker, Peter (Worcester)
Elliot, Capt. Walter (Carshalton)	Mawby, Ray	Walker-Smith, Rt. Hn. Sir Derek
Elliott, R.W. (N'c'tle-upon-Tyne, N.)	Maxwell-Hyslop, R. J.	Wall, Patrick
Emery, Peter	Mills, Peter (Torrington)	Ward, Dame Irene
Errington, Sir Eric	Mitchell, David (Basingstoke)	Weatherill, Bernard
Eyre, Reginald	Monro, Hector	Whitelaw, Rt. Hn. William
Farr, John	Montgomery, Fergus	Wiggin, A. W.
Fisher, Nigel	More, Jasper	Wilson, Geoffrey (Truro)
Fletcher-Cooke, Charles	Morgan-Giles, Rear-Adm.	Winstanley, Dr. M. P.
Fortescue, Tim	Morrison, Charles (Devizes)	Wood, Rt. Hn. Richard
Foster, Sir John	Munro-Lucas-Tooth, Sir Hugh	Woodnutt, Mark
Fry, Peter		Worsley, Marcus
Galbraith, Hn. T. G.	Nabarro, Sir Gerald	Wylie, N. R.
Glover, Sir Douglas	Neave, Alrey
Goodhart, Philip	Noble, Rt. Hn. Michael	TELLERS FOR THE NOES:
Goodhew, Victor	Onslow, Cranley	Mr. Michael Shaw and
Gower, Raymond	Orr, Capt. L. P. S.	Mr. Michael Jopling.
Grant, Anthony

Resolved, That this House takes note of the grave threat to the interests of the northern development area arising from the Tory shadow cabinet's proposals at its Selsdon Park meet- ing; and congratulates the Government for pursuing policies aimed at assisting the Northern development area to recover from the effects of the changing pattern of industry, and the years of neglect under the previous Tory governments.