SCOTTISH AFFAIRS

HC Deb 03 February 1971 vol 810 cc1689-809

Mr. Speaker

Before I call the Secretary of State to move his Motion, I should inform the House that I have selected the Amendment standing in the name of the right hon. Member for Kilmarnock (Mr. Ross), in line 2, at end add: 'but condemns Her Majesty's Government for adopting ill-considered policies which, to the detriment of the current performance and future prospects of the Scottish economy, eliminate direct investment incentives, weaken industrial development certificate control and reduce the level of regional assistance given general acceptance in the Report'.

4.15 p.m.

The Secretary of State for Scotland (Mr. Gordon Campbell)

I beg to move, That this House takes note of the Report of the Select Committee on Scottish Affairs in Session 1969–70 on Economic Planning in Scotland (House of Commons Paper No. 267). I welcome this opportunity to debate the Report. The subject affects several Government Departments, and the Report provides a lucid description of the rôle of the central Government in economic development in Scotland. The Report points out that, while the Secretary of State for Scotland has statutory responsibility for a wide range of subjects through his four Scottish Departments, other Ministers are also involved in economic and financial matters. But the Secretary of State has responsibility for planning decisions and, as Scotland's Minister, he is expected to be, and must be, concerned with problems and decisions affecting the Scottish economy.

The Select Committee investigated how the Government machine is geared for economic planning. It also looked at the consultative machinery. I have already made clear that I agree with its findings concerning the Scottish Economic Planning Council, as it used to be called. This body meets in private, but it has become clear that it has no executive planning powers. Nor did the Committee recommend that it should have such powers. I have decided that a council with this kind of composition has a useful rôle as an advisory body on economic matters as a whole. I have accordingly announced that it will in future be known as the Scottish Economic Council, and that its rôle will be an advisory one to the Secretary of State and the Government In this, I am following the views of the Select Committee.

The Select Committee also considered the whole question of investment incentives for regional development. While it commented on the advantages and disadvantages of various kinds of incentive, no particular one or combination was recommended. For example, the Report points out that the investment grant system encouraged capital-intensive industries, and that, though some of these are required in Scotland, they are less able to provide the numbers of jobs in a shorter term that other industries can. It was also noted that the service industries were left in the cold.

The Select Committee's Report followed a Report of the Estimates Committee of the previous year which had called for an investigation into the effectiveness of investment grants—an investigation which the last Government duly started. That investigation was still going on, and the Select Committee's Report had just been published, when the present Administration came into office at the end of June.

It was clear to us that new measures were urgently necessary and that changes in the system had to be made. We lost no time in carrying out an urgent, but full, review. On 27th October, our first decisions on new measures were announced. While the system of investment grants is being discontinued, other grants for development under the Local Employment Acts—those more directly related to new jobs—are to be used more extensively. Thus, a combination of grants and loans, and a new system of capital tax allowances, is aimed to gain the advantages of both systems described in the Select Committee's Report. A wider range of industry will benefit, including service industries. The level of regional assistance is not being reduced. Assertions to the contrary are entirely wrong, though we have become used to such mis-statements from the benches opposite.

Broadly, the total amount of the differential in favour of the development areas remains the same. But it is a more flexible combination of incentives, more closely geared to the employment that we need, and likely to be more effective. Changes were needed. Four years of the previous arrangements have brought us to a state of very high summer unemployment, stagnation and a bleak winter. How have members of the previous Government the temerity to criticise changes, when they had brought Scotland to this state? The sheer irresponsibility of their attitude is staggering.

However attractive any incentives may be, 1 must agree with the Select Committee, in paragraph 4 of its General Conclusions, that the results will depend on the industrial growth attained in the United Kingdom. If there is a limited supply of mobile industry and little scope for expansion, despite what one hopes to get from abroad, development in the regions concerned is restricted.

That is no doubt one reason why there has been such an alarming net loss of jobs in Scotland in the last 5 years. From March, 1966, to March, 1970, there was a decrease of 82,000 in the estimated number of employees in employment in Scotland. Employment expanded in Scotland in the first half of the 1960s and declined in the second half. There has been a serious falling off in the amount of new industrial development in Scotland, as recorded by i.d.c. approvals, in the last 2 years.

Since 1965, the whole economy has been subjected to increasingly severe fiscal and monetary policy. The squeeze and freeze were applied, and then there followed devaluation and the 1968 Spring Budget, with the biggest increase in taxes for many years. Further seventies ensued and the pace of inflation was allowed to increase dangerously last year so that there was no prospect of encouragement being given to expansion.

In May and June, before coming into office, I was pointing to this gloomy prospect and publicly asking the then Government what they intended to do about it. The answer was nothing. No response. I pointed out, over several months, on television and elsewhere, to the then Secretary of State that high unemployment was inevitable if things were allowed to drift. Again nothing happened.

It is perfectly clear now why there was a General Election in June. There was no need to hold it then—the Labour Government could still have been in office today and until April. But they decided not to wait even until October.

The reasons soon became clear in Scotland. A few days after the Labour Government's departure, the unemployment figures in July showed that 93,000 people were out of work in Scotland. That was the height of summer when unemployment should be low.

What did the right hon. Gentleman the Member for Kilmarnock (Mr. Ross) expect the figures to be in September and December? Did he expect them to improve? Did he, for example, think that there would be only 80,000 out of work in January? No, of course not. He knows, as well as everyone else, that the figures could not fail to get worse as autumn and winter approached. Standing at 93,000 in July, they were bound to go well over the 100,000 mark during the winter. Nothing that the new Government could do would have been in time to stop that happening.

The clear evidence of the deteriorating position in Scotland before the last Government left office is shown in the following figures. The i.d.c.'s issued in Scotland in the twelve months from June, 1969 to June, 1970, the period of a year before the June Election, reflected a reduction of 34 per cent. in the number of jobs involved, compared with the previous 12 months.

I mentioned earlier the net loss of jobs since 1965. The position before then was clearly set out in the last Government's 1966 White Paper on page 9. There it is recorded that in the four years 1960–64 new jobs were being created at a rate of very nearly 40,000 a year—over 39,000. Although the run down of jobs in agriculture and the older industries was taking place during the whole of the decade, the important fact in those four years was the net gain of over 7,000 jobs a year. The new industrial development was more than compensating for the disappearance of jobs in coal mining and the other industries.

The extraordinary paradox was that the right hon. Member for Kilmarnock was at that time moaning and groaning in his well known way, and urging that a target of 40,000 new jobs a year should be set. The statistics in his own White Paper later showed that he had no grounds to criticise, because that figure was indeed being reached.

Unfortunately, we cannot start that scale of growth and industrial development again—and increase it—in a situation of wildly inflationary wage claims. Before the last Government abandoned office they allowed a wild game of wages leapfrog to start, following their disastrous attempt to freeze wages by stature. This is the situation which we must get under control now.

I must emphasise as strongly as I can that inflationary wage claims will simply price us out of jobs. Those who urge their fellows to press claims which are totally unrealistic may in fact be losing their jobs for them altogether. Employers will be forced to reduce their activities and labour forces rather than expand.

The Times Business News of Friday, 22nd January, clearly stated: … it may well have been that the very rapid rate of increase in pay in the fourth quarter has helped to push up the unemployment rate. Organised workers have been pricing themselves out of the market, or at least reducing the ability of employers to employ other people.

Mr. John Robertson (Paisley)

Will the right hon. Gentleman give way?

Mr. Campbell

The hon. Gentleman will have a chance to speak later.

Hon. Members

Give way.

Mr. Campbell

All right.

Mr. Robertson

Does the right hon. Gentleman agree that workers are trying to push up their wages to meet demands in prices which his right hon. Friend promised would be brought down "at a stroke"?

Mr. Campbell

If that is so, it is the result of the disastrous freeze imposed by the last Government and their total failure to control the subsequent inflationary wage pressure.

When I and my colleagues took over this gloomy situation in June, we set ourselves two immediate tasks. The first was to make the changes in regional development measures which were announced in October. These will in time help to improve the situation.

Secondly, we brought in—

Mr. Douglas Jay (Battersea, North)

Will the right hon. Gentleman give way?

Mr. Campbell

I should like to continue. I have given way once to a Scottish Member.

Secondly, we brought in urgently a special works programme, for Scotland only, for this winter.

An Hon. Member

Chicken feed.

Mr. Campbell

Wait for what is to come. This is helping to relieve unemployment now.

When a deputation of Labour Members of Parliament came to see me during the recess in September, they agreed that a winter scheme of this kind would help, though they recognised the limitations of any such scheme, and urged me to arrange and announce it as soon as possible This I did.

I now have an important announcement to make which should be very welcome to the House. The Government have decided that the problems of industrial West Central Scotland require a new approach—[HON. MEMBERS: "Oh!"] This will be no surprise, because I have just been describing the situation which we found on taking office. The Government have decided, in principle, that a substantial part of the area of West Central Scotland should be designated as a special development area in which additional financial inducements to new industrial growth will apply.

Briefly, these inducements include a higher rate of building grant of 45 per cent. for all new developments; operational grants based on labour costs; and a five-year rent-free period for new rented factories. The exact boundaries of the area and other relevant details will be announced in due course, but I can say now that the special development area will, of course, include Glasgow and the Clydeside conurbation.

Mr. David Lambie (Ayrshire, Central)

Will it include Hunterston?

Mr. Campbell

Against the background which I have described—

Mr. William Ross (Kilmarnock)

Will this require legislation or will it start right away? Will it be available as from tomorrow?

Mr. Campbell

I cannot give precise details at this stage. The Government have decided to designate a large part of this important area as a special development area. I cannot at this moment go into all the details. The answer is that it will begin as soon as possible. If it can be done without legislation, it will be done without legislation.

Mr. Ross

It cannot be done without legislation; neither can some of the proposals announced in October. We want to know when we shall get this legislation. If it is as urgent as the right hon. Gentleman says, the legislation should have been ready today.

Mr. Campbell

Despite the non-cooperation of the Opposition on practically all parliamentary business at the moment arising from their attitude to the Industrial Relations Bill, I sincerely hope that there will be no opposition to this legislation when it is put forward.

Hon. Members

When?

Mr. Campbell

I am making the announcement now, but I cannot give the details. If legislation is necessary we shall bring it in as soon as possible.

Mr. Robert Maclennan (Caithness and Sutherland)

Will the right hon. Gentleman give way?

Mr. Campbell

No. I must proceed. I have another interesting announcement to make.

Mr. Maclennanrose—

Mr. Deputy Speaker (Sir Robert Grant-Ferris)

Order. It is obvious that the right hon. Gentleman is not giving way. The hon. Gentleman had better wait.

Mr. Campbell

I am amazed that right hon. and hon. Gentlemen opposite should not welcome the announcement, and should appear to be picking nits at present. If legislation is required, it will be brought forward, but my advice is that it will not be necessary.

Against the background which I have described, we have also been considering what assistance we can give to Glasgow. Good housing is vital for the city's economic future as well as for social reasons, and since we took office we have been investigating how we can best provide the special housing assistance that we consider necessary. It is now clear that this can best be devoted to mounting an additional house-building programme outside the present city boundaries, an assential need for the next decade.

We are prepared to make increased use of the Scottish Special Housing Association for this purpose, with an addition to the programme already announced for Erskine and also in other areas near Glasgow. We are also considering arrangements for further use of the new towns machinery at a fresh location outside Glasgow—one possibility would be to use the existing East Kilbride Development Corporation as the agency for carrying out a large development in the Stone-house area of North Lanarkshire. I cannot give more details now, but I shall of course be making a further statement when I am in a position to do so.

Dr. J. Dickson Mabon (Greenock)

Does not the Secretary of State realise that on behalf of my right hon. Friend the Member for Kilmarnock (Mr. Ross) I announced precisely the same thing 12 months ago, and that he is under an obligation, because of what has been said by his leader, his junior Minister and himself, to provide special aid which we did not designate when we were in office. What is that special extra aid?

Mr. Campbell

What the hon. Gentleman announced was a mouse compared with what I am now announcing.

Inside the city there is a great and urgent need not only for the modernisation of older houses—and we are supporting the corporation's drive for this—but also for an intensive compaign to improve the general environment. The need for this is both economic and social. I hope soon to discuss with the corporation how this problem can most usefully be tackled.

Mr. Tom McMillan (Glasgow, Central)

Is the Secretary of State taking into account the fact that inside Glasgow at this moment children are dying in the festering slums, and that a public inquiry has said that bad housing contributes to deaths? What immediate proposals has the right hon. Gentleman for the alleviation of the problem?

Mr. Campbell

I am happy to have the hon. Gentleman's support for the programme I am announcing, and also his satisfaction that last year, I understand, was a record for the rehousing of families in Glasgow.

May I now remind the House of the methods of attracting and encouraging industrial developments. There are now three forms of assisted area. The most assisted tier is the special development area; the second is the development area and the third is the intermediate area. While there are special arrangements for the S.D.A.s, the main new measures for development areas are the advantage of free depreciation, which can be carried forward to later years for companies not making profits to start with, and the more extensive use of grants and loans under the Local Employment Acts which are directly related to new jobs. Amongst other things this will encourage improvement of infrastructure, especially clearance of derelict land.

In October it was announced that regional employment premium would continue for four years until the end of its guaranteed time. Service industries will now benefit from a 60 per cent. capital allowance and training and retraining arrangements will be increased.

For the development areas only, a new scheme will be coming in to help the tourist industry when the hotel incentive scheme comes to an end in April.

Evidence available so far indicates that the announcement of these new measures, far from holding up development, has increased it. In the last quarter of 1970, industrial development certificate approvals were issued in respect of 59 projects in Scotland, estimated to provide additional jobs for 3,300 people. In terms of new jobs this was considerably higher than the average figure for the first two quarters of the year. This means that in the last quarter of 1970 there was a higher rate of new jobs in projects than in the first half of that year.

On the I.D.C. system generally, we agree with the view of the Select Committee that it is an essential part of an effective regional policy. We have not accepted the majority proposal of the Hunt Committee, set up by the last Government, to the effect that I.D.C. limits should be raised outside the development areas to 10,000 square feet. On the contrary, we have adjusted the system to recognise what has been done in practice. In the South East and Midlands, the I.D.C. limit is restricted to 5,000 square feet, and it is only outside these two areas that the limit has been raised to 10,000 square feet.

Mr. George Lawson (Motherwell)

The limit of 5,000—

Mr. Deputy Speaker

Order.

Mr. Lawson

I understood that the right hon. Gentleman was giving way.

Mr. Campbell

No, I was not.

Mr. Deputy Speaker

Order. All hon. Members know that they cannot get up and speak without the hon. Member who has the Floor giving way. I am quite sure that in due course the right hon. Gentleman will give way to all Members that he thinks reasonable. I am sure that the hon. Member for Motherwell (Mr. Lawson) wishes to observe the rules.

Mr. Lawson

On a point of order. When we listen to what I take to be a deliberate piece of misrepresentation, Mr. Deputy Speaker, we can be goaded into interventions like that.

Mr. Deputy Speaker

Order. Whether or not the hon. Gentleman thinks that, the rules of the House must be scrupulously observed.

Mr. Campbell

The word "reasonable" was the appropriate one, Mr. Deputy Speaker, and the remarks the hon. Gentleman has just made confirm that his question was likely to be unreasonable.

I was pointing out that outside the Midlands and South East the limit has been raised to 10,000 square feet. The effects of these small changes will be negligible. For example, in the whole of the year 1969, when the last Government were in office, not a single application under 10,000 square feet was refused outside the Midlands and the South East. That is the overwhelming evidence that the adjustment we have made will make no difference, but will reduce unnecessary paper work.

Let us not overlook the prospects and promise that lie someway ahead—the finds of North Sea oil off the Scottish coast and, for example, the massive tankers serving the petrochemical complex at Grangemouth, through Loch Long.

The Firth of Clyde has immense potential for the future. We chose a Supply Day and I opened a debate on this subject in 1969, to draw attention to this. I have followed this up by my planning decisions at Hunterston, and the way is open for worthwhile development which can bring prosperity and jobs while causing the minimum of damage to amenity. I must make it clear, however, that these are prospects for the future. There is nothing that can be done to exploit the deep water and other facilities in the Hunterston area which could materially affect employment in the near future. Besides attracting industry from elsewhere in Britain and encouraging industry in Scotland to expand, Scotland is mounting and co-ordinating promotional campaigns abroad. My hon. Friend the Under-Secretary of State for Development has been closely concerned with this, and he will say more about it when he winds up the debate.

Mr. Maclennan

As the Highlands and Islands Development Board felt it appropriate to spend £100,000 on industrial promotion, why does the hon. Gentleman think it is appropriate to spend £20,000 on the whole of Scotland, and to prevent the Board from carrying out its promotional schemes in the United States and Germany?

Mr. Campbell

I do not accept the last part of that remark. We have made arrangements, as we have announced, with the Scottish Council for the provision of some money, and they are raising the rest themselves—£20,000 has been mentioned. That is twice as much as the previous Government were supplying in the previous three years. We are naturally concentrating on a country like Germany, whose Governement has asked firms to expand abroad.

We are determined to ensure that the excellent sites and conditions which Scotland can offer are made known, and that our publicity efforts are used to full effect without danger of unnecessary duplication or apparent conflict. That is perhaps one of the important points which the hon. Member will himself appreciate.

Mr. Dick Douglas (Clackmannan and East Stirlingshire)

If I interpret the Secretary of State correctly, he means that he wants to try to iron out the possible sub-regional competitiveness in industry and "sell" Scotland as a whole. That job should not be given to the Scottish Council; it is a job for him.

Mr. Campbell

I accept that, and I and my right hon. and hon. Friends—I would mention in particular the Under-Secretary of State for Development—have already shown, in the last six or seven months, that a lead can be given. But we need the support of industry itself, of course, organised in the appropriate bodies, and we need to co-ordinate the efforts being made by local authority associations and by bodies like the Highlands and Islands Development Board. Otherwise, the effect abroad can be of uncoordinated visits which appear to be cancelling each other out. This is what we regard as our job as a Government to try to help to resolve.

Mr. John Brewis (Galloway)

Would my right hon. Friend point out to the hon. Member for East Stirlingshire (Mr. Douglas) the denigrating remarks of his right hon. Friend the Member for Kilmarnock (Mr. Ross) when his predecessor went to America?

Mr. Ross

That was because he came back.

Mr. Campbell

I thank my hon. Friend for that remark. I have not yet started on peripatetic tours myself—[HON. MEMBERS: "More's the pity."]—but my hon. Friend has been doing this on my behalf most successfully.

Any action to prevent the situation which we now face this winter in Scotland would have had to be taken well over a year ago, but the Labour Government were oblivious to the warning signs and the deteriorating situation. Nothing was done and nothing said.

There was a debate in the House on the Scottish economy in May 1969. That was just about the time when new measures could have been discussed which would have improved the state of the Scottish economy by now. What part did the then Secretary of State play? He did not even speak in the debate. Of course, that was during the reign of William the Silent. It must be remembered that the hon. Member for Fife, West (Mr. William Hamilton) had decided that his best contribution to the future of Scotland's economy was to filibuster that debate. As it was precious private Members' time that he was eating into, I described him then as a parliamentary cannibal. But even he left time for a wind-up speech from his own Front Bench, but the right hon. Member for Kilmarnock disdained the opportunity. Later in 1969, we had the debate on future development in the Firth of Clyde with its valuable assets of very deep water and suitable adjoining land for a super-port and industrial development. Matters of great concern to hon. Members on both sides were discussed. What part did the then Secretay of State play? Again, he did not deign to speak at all.

Mr. John P. Mackintosh (Berwick and East Lothian)

Is the right hon. Gentleman aware that those of us who spent a long time on this Select Committee putting in a great deal of work studying regional planning hoped that his speech would take note of the detailed points and discuss the intricate problems of regional planning and not go in for this third-rate, trivial, partisan knockabout which we hoped would abandoned? This is a debate to take note of the Report of the Select Committee.

Mr. Campbell

In that case, the hon. Gentleman should have advised his right hon. and hon. Friends not to put down the Amendment which is on the Paper. It was clear from the moment that it appeared what was going to happen in this debate.

I and my colleagues arrived in office to find our worst fears confirmed. There was no movement in the economy other than successive depressing reports of closures and redundancies, with little countervailing development to replace them. Inflation was rife, giving no hope of early renewal of industrial expansion. Unemployment was at an astronomical figure for mid-summer and was bound to become very bad during the winter.

During the rest of this debate, it is clear that we shall hear accusations and charges from the other side attempting to attack us about this. All such criticism can only rebound on the previous Government. Brickbats from the other side will be found to be boomerangs.

Mrs. Judith Hart (Lanark)

While the right hon. Gentleman is embarking on this knockabout, as my hon. Friend described it, may I point out to him that on one matter at least—a matter on which he has made an important announcement this afternoon—the housing development at Stonehouse, we know that this has been on his desk since he entered office nearly eight months ago, yet all we get this afternoon is the vaguest of announcements. Before he sits down, I hope that he will tell us precisely how the proposals which he has announced are qualitatively different from those which the previous Government had already announced, and whether he will, in view of the considerable uncertainty which he has imposed upon many groups of people, tell us which agency will be responsible for the building.

Mr. Campbell

I can answer that one briefly by saying that the scheme which I have announced is a great deal larger than what I found when I came in—

Mr. Douglas

How much?

Mr. Campbell

I have already occupied a good deal of time in this debate. My hon. Friend the Under-Secretary will reply to the debate in due course——

Dr. Dickson Mabonrose——

Mr. Campbell

No, I have given way enough——

Dr. Mabon

Could the right hon. Gentleman say——

Mr. Campbell

I have given way to the hon. Gentleman several times.

Dr. Mabon

On a point of order——

Mr. Campbell

Oh, no.

Dr. Mabon

On a point of order. Would you take note, Sir Robert, that relevant information which we are seeking for this debate is to be announced at the end of the debate? Surely, as a matter of good debating and the practice of the House, we should know, out of courtesy at least, if not out of intelligence, what figures we are talking about.

Mr. Deputy Speaker

That is not a point of order for me. The right hon. Gentleman must make his speech as he thinks best.

Mr. Campbell

The hon. Member for Berwick and East Lothian (Mr. Mackintosh) has already complained that, although I have covered a great deal of the ground which the Select Committee covered, I have been concentrating on certain particular matters. Clearly, in opening a debate like this, it would be wrong for me to go into the details of this single announcement which we will be discussing and which the House will be able to consider later.

While no Government, taking over last June an inflationary and stagnant economy, could have taken measures in time to change dramatically the depressing winter scene in Scotland, we can take action for the future and we are doing so. I have outlined some of the new measures and the promotion effort which we are helping to mount. We are determined to get out of this rut and all who live and work in Scotland can help to do it.

Responsible and co-ordinated efforts are required if we are not to price ourselves not only out of jobs but out of export markets. As I said in a recent newspaper article, the world does not owe us a living. By our own efforts, and with the help of the resources of the United Kingdom through regional development policy, we must excel.

The Scots have set the pace and led the world in many fields, often in the face of initial difficulties. We need those characteristics and resources—[Interruption.] I am surprised that hon. Gentlemen opposite are not echoing the feelings which I am expressing at this point—more than ever before and I am confident that, given a lead and the stimulus to inspire effort and working together, we can build new industrial success on firm, modern foundations.

4.50 p.m.

Mr. William Ross (Kilmarnock)

I beg to move, at the end of the Question to add, 'but condemn Her Majesty's Government for adopting ill-considered policies which, to the detriment of the current performance and future prospects of the Scottish economy, eliminate direct investment incentives, weaken industrial development certificate control and reduce the level of regional assistance given general acceptance in the Report'. I have been called many things in this House, but "William the Silent" is a new one. I am far from silent.

Mr. T. G. D. Galbraith (Glasgow, Hillhead)

I wish the right hon. Gentleman was.

Mr. William Hamilton (Fife, West)

I thought the hon. Gentleman was asleep.

Mr. Ross

The hon. Member for Glasgow, Hillhead (Mr. Galbraith) is interrupting not so much from a sedentary as from a recumbent position. I cannot understand why earlier he urged hon. Members to exercise self discipline. I have hardly begun to speak than he is at me. He is getting more like his father every day.

The right hon. Gentleman the Secretary of State took me to task for not intervening in a debate on Hunterston. He should have stopped to think at least twice before accepting that piece of research from whoever conducted it. He should have known that the one person who could not express an opinion about Hunterston and about the deep water port and so on was the then Secretary of State, who had to sit in a semi-judicial capacity and eventually receive the findings of the inquiry.

I recall the right hon. Gentleman being discreetly silent on the subject, and I never pressed him on it because I recognised his position. This is the kind of level of criticism in which hon. Gentlemen opposite indulge. [HON. MEMBERS: "Withdraw."] I will not ask the right hon. Gentleman to withdraw that remark——

Mr. Gordon Campbell

I say straight away that if, in July 1969, the inquiry had already started, I immediately acquit the right hon. Gentleman of not taking part in the debate.

Mr. Ross

The right hon. Gentleman must have known that by that time. Notice of objection and so on had been given. The controversy had started. That was why the debate was mooted. The hon. Member for Glasgow, Hill-head will remember the many Questions that were put to me and how I had to answer to that effect. He accepted that, recognising the responsibility of the Secretary of State. [HON. MEMBERS: "Withdraw."] As I say, I will not ask the right hon. Gentleman to withdraw. His speech was obviously written and made by him against his better judgment. Suffice to say that some of my hon. Friends have suggested that it was like a fairy tale. "Grim Gordon's Fairy Tale", they are calling it.

We are invited to take note of the Report of the Select Committee on Scottish Affairs and it is worth recalling that that Committee spent the better of two years making what was probably the lengthiest and deepest probe into Scottish affairs covering not only the Secretary of State's Department but also the Board of Trade and the Ministry of Technology; indeed, covering anybody who had anything to do, directly or indirectly, with the promotion of regional development.

The Report was published on 13th May of last year and my hon. Friends asked for a debate on the subject. We are eventually asked to take note of it in February, 1971, when the Government have made announcements in respect of the core and centre of regional development and have obviously brushed aside, probably never even having read, the Report. I cannot think of anything more insulting to the work of a Select Committee.

It is customary, when a Select Committee reports, for the various Departments concerned to write their replies and for them to be given in a paper to the House, and then the whole matter is debated. That applies to the Estimates Committee, the Public Accounts Committee and all others, including the one covering the nationalised industries. But what happened in this case? The Government ignored the Report and, before we were even asked to take note of it, they had made their decisions. This demonstrates that they paid no attention to what the Report said.

I pay tribute to the Committee's Chairman, Mr. Tom Steele, and the 16 hon. Members who served on it, four of whom are no longer with us, for various reasons. I gave evidence before the Committee and I was satisfied, as a result of what I was told by my officials, with everything that had gone on and that the Committee was doing a thorough and first-class job. I was also satisfied that any Government would ignore to their peril what came out in the evidence and findings of the Committee.

The Under-Secretary of State for Development, Scottish Office, who will reply to the debate, was a signatory to this Report. I remind him that it was presented not a century before the General Election but on 13th May, 1970, one month before the election, and that the Report said: we think that economic planning in Scotland can be said to be organised on sound lines". This was scarcely mentioned by the right hon. Gentleman, though the Report said: We can attempt to assess this only in general terms … But it is certain that the structure and balance of industry in Scotland has greatly changed in the last few years. Many of the older industries which once flourished in Scotland have greatly declined. This is about the question of the loss of jobs, which the Minister did not even try to analyse and certainly does not understand. The Report went on: while new and more competitive industries … have established themselves; there is no doubt that this represents a strengthening of Scotland's industrial structure". The Minister agreed to that on 13th May, 1970, but something changed his mind a month later. This is the trouble with the Government. They make changes and then find out what the country feels about them.

We have taken this exceptional step of taking note of the Report but asking the House to condemn the Government simply because the work of the most important Select Committee ever to be set up for Scotland was insulted by being ignored. What has happened to this Select Committee? It has not been reestablished, though we were given a pledge that it would be. Why the delay? We are only able to guess. Is it that hon. Gentlemen opposite cannot, or are unwilling to, man their side of this Committee. I have even heard it suggested that we should have Members of the House of Lords put on the Committee.

This is because the efforts of hon. Gentlemen opposite in Scotland in the past have been such that they have been decimated in the last three General Elections in Scotland; and, meanwhile, Mr. Europe spends his time in the Committee Corridor waiting to vote on an Education Bill that should never have been introduced.

When will this Select Committee be re-established? Is this inability to man it the reason for the Government's weakness in this matter? Or is it that they do not want such a Committee to go into what the present Government are doing and have been doing?

The Secretary of State made two announcements today. We welcome one of them. I was surprised that the right hon. Gentleman could not tell us whether his announcement would mean legislation. At present the special development areas are limited to coalmining areas. A change is to be made, and legislation will be required. We have not been told what the global figures of expenditure will be. The Government have been less than fair with us. However, we welcome the proposal as far as it goes.

Mr. Ian MacArthur (Perth and East Perthshire)

At last.

Mr. Ross

That was the second time. Next, the right hon. Gentleman's proposals for helping Glasgow will sorely disappoint the Tory-controlled council in Glasgow. The Tory-controlled council was expecting to get additional money to help it with its housing programme. It was expecting to get as much help as we gave it when we changed the formula in respect of rate support grant, which gave the council an additional £½ million per year as a starting figure. All that the right hon. Gentleman has done is to repeat what we said we would do and in respect of which we were in active consultation with Glasgow about Erskine.

The right hon. Gentleman said that he has not even started discussions with Glasgow yet. I hope that his experience is a little better than our experience in respect of the hopes for Erskine.

The right hon. Gentleman told us, as a great tribute to Glasgow, that it had a record number of re-lettings. What the people of Glasgow are interested in is new housing in Glasgow. The number of approvals of new houses and the number of completions last year was lamentable; Glasgow let Scotland down.

The Report stresses the importance of infrastructure—the need for housing, jobs, and so on. Last year in Scotland we had another record of house building. The Tories might have given credit to the Labour Government for that. We saw plenty in the national newspapers about the parlous state of house building in England and Wales. We saw little in the Scottish Press about the fact that we had achieved yet another record in Scotland with nearly 45,000 houses.

The right hon. Gentleman might have explained why the number of approvals in 1970 dipped by more than 13,000. The Under-Secretary has been in charge for six months. If he was not satisfied with the rate of approvals for the first six months, the Secretary of State should have done what I did with my hon. Friend and my noble Friend Lord Hughes: he should have sent the Under-Secretary round Scottish local authorities to ensure that approvals in the second six months met Scotland's needs. That is why in 1970 there was that number of approvals. The record number was in 1966.

In the matter of infrastructure and housing we are going back to the calamitous state to which the Tories drove us in the early 1960s when the house building total in Scotland dropped to as low as 26,000. For the past four years, in each succeeding year it has been a record and we reached nearly 45,000 in 1970.

We should concentrate our attention on the terms of the Amendment: 'but condemns Her Majesty's Government for adopting ill-considered policies which, to the detriment of the current performance and future prospects of the Scottish economy, eliminate direct investment incentives, weaken industrial development certificate control and reduce the level of regional assistance given general acceptance in the Report'. As to "ill-considered policies", does the Secretary of State suggest that the housing policy is well-advised in relation to the present needs and the present performance? At Question Time the right hon. Gentleman refused to put a figure on the number of houses he hopes to build. In 1964 the Tories did not leave us a great inheritance of houses under construction and those awaiting start. In 1970 we left them at least 8,000 more than they left us in 1964.

Other announcements as to policies were in relation to the I.R.C. and the Industrial Expansion Act. It was under the Industrial Expansion Act that we built the smelters. The Tories congratulated us on having done so, but there were some Tories on the Front and back benches who thought that we should not have done so. They did not take that view in the Highlands. I do not know how the hon. Member for Ross and Cromarty (Mr. Gray) can justify his colleagues' attitude on this. Let him tell the people in his area that the Act under which this could be done is being repealed.

The Industrial Expansion Act was helpful to us in respect of the motor car industry. I give credit to the Tories for bringing the motor car industry to Scotland, but the industry had troubles. At one time Rootes looked like going out. Leyland-B.M.C. had its troubles. Not only was the I.R.C. brought into play, but by following through the regional policies, which we insisted were not purely for the Scottish Office and the Board of Trade but were for every Government Department, we were able to ensure that the Linwood development would be protected and that the expansion, if it took place, would take place there. The same was true in relation to Bathgate. Now these things are to go. The Government's action is ill-advised.

As to what we say in the Amendment about the removal of direct investment incentives, are hon. Members satisfied that, with the removal of the direct incentive of the investment grant, which gave a 20 per cent. lead to Scotland, Scotland will be better served or investment will be better served by the change to tax allowances?

There was much discussion on this point at the time. The right hon. Gentleman will find no condemnation of the investment grant system in the Report. The S.T.U.C. was for investment grants. So was the Scottish Council. The C.B.I. in. Scotland was for them.

The only body which was against investment grants was the C.B.I. in London; and that body thought only that they should be removed in the future. The C.B.I. was speaking to a Scottish Committee. It might have expressed a different view if speaking to a Tory Secretary of State.

We have had plenty of information about what has happened. There is a down-turn in investment in Scotland. The right hon. Gentleman has been in his post for the better part of seven months. The Tories have declared their policies. The fact that the day after their mini-budget and their give away of £350 million they tightened the squeeze meant that people just did not know where they were under this Government.

The Financial Times for Monday, 1st February states: The evidence of a downturn in manufacturing industry's spending on new plant and equipment is now virtually conclusive.… A downturn has been predicted for some months, by the Confederation of British Industry among others, and now all the indicators are pointing in that direction.…. Orders for new machine tools, which can be regarded as an even clearer sign of what is happening, began to fall away last summer and, according to the latest reports from the industry, the decline has accelerated in the last few months. Many factors are being blamed"— and it lists the factors, including— the Government's decision to switch from investment grants to capital allowances. The Times reported, in a leader on 28th January, … serious doubts about the real net outlay —future investment will involve … much uncertainty about the real cost of investment… It said that the Government should clarify the switch from investment grants to allowances. Very few people are clear about this. Those who are are satisfied that the switch is to the disadvantage of the development area. The Scotland magazine, which examines in depth each month the topics which concern business and industry in Scotland, also condemns the switch from investment grants to allowances.

The Under-Secretary of State for Development, Scottish Office (Mr. George Younger)

The right hon. Gentleman said that the decline in investment started in the summer, but his scheme was going flat out until 27th October. How does he explain the decline?

Mr. Ross

On 27th October, the Government announced a new policy. This is relevant to some of the figures the Government have produced about industrial development certificates in Scotland. It would be interesting to know what the position was in the last three months under our policy compared with the first three months under the Government's new policy. There has been the acceleration of decline since the Government announcement was made. Has the hon. Gentleman read these articles? The Times on 28th January reported: Withdrawal of investment grants leads 30 companies to delay investment plans. It clarified its headline as follows At least 30 major companies have told the Department of Trade and Industry that they must postpone, or even abandon, important development schemes following the withdrawal of investment grants in favour of a new system of capital allowances. The Government should face the facts as quickly as possible. I doubt whether the damage which will be done by their policy will be entirely discounted by the change they are making in special area development status for part of Scotland.

Mr. Alex Eadie (Midlothian)

What my right hon. Friend is saying can be confirmed by reference to the experience of Midlothian County Council. It can substantiate his case by the fact that firms which previously had an interest in going to Midlothian are either no longer interested or are reluctant to go or are in a state of indecision about going.

Mr. Ross

That experience is certainly relevant to my case. The statements I have quoted relate to major companies. Of course, many of the smaller companies will not proceed and will not tell the authorities. The latest figures we had received before leaving office were that jobs resulting from industrial development certificates would total over 55,000. Last week, we were given the figure of 40,000. The attrition has started. The right hon. Gentleman cannot create alibis now. The Government have been in office since 18th June. They must accept responsibility for the climate of opinion and the lack of confidence in the economy —a lack of confidence they themselves created.

Mr. Younger

The right hon. Gentleman has not quite understood the point I put. Can he explain why the downturn in investment started, as he says, in the early summer, when his investment grants scheme was still running until 27th October?

Mr. Ross

The Government proclaimed their intention. Perhaps that is one of their troubles. They think that no one is listening to them. Indeed, few people listened to the Conservative Party in Scotland and few took them seriously. It was on 28th September, 1969, that the present Prime Minister, as Leader of the Opposition, in a discussion with James Gordon on Scottish television, said that there would be a large cut in the money that was being spent in developing industry in Scotland. The Secretary of State still has to square his statements about the differential being the same and the amount of money being the same. Someone is kidding him, because I would not accuse him of trying to kid us. He has amply demonstrated his ignorance. Someone has taken advantage of his kindness of heart.

We were also told at the time that the regional employment premium, another direct incentive, was also to be cut. Has the right hon. Gentleman read the Select Committee's Report about the R.E.P.? It contains no indication of condemnation of R.E.P. Nor is there any indication of condemnation in the evidence. If the right hon. Gentleman studies Question No. A141 and the answer given by Sir Robert Maclean, he will see exactly what that very distinguished public servant had to say.

Mr. Gordon Campbell

I do not know what the right hon. Gentleman is arguing about on this. As I said, the decision was that the regional employment premium should continue from last October for the four years remaining to the end of the seven years for which it was introduced.

Mr. Ross

We have been told that it is to be ended. We have not been told that it is going to be replaced by something else. We are told that the same amount of money is going to be spent on regional incentive in Scotland, but it just does not add up. Sir Robert Maclean was asked about all the incentives. He replied They are very significant. The investment grant is very important indeed. There is no doubt that the regional employment premium is very important. The availability of factories is very important. They are all of a piece. If any one of these three were taken away I am not sure the stool would not collapse. The Government have now cut off two of the three legs. They have announced the ending of the regional employment premium and have already withdrawn investment grants. Yet, as Sir Robert pointed out, they all hang together—and that is certainly what the Government should be doing. He went on: I would hesitate to say which was the most important to an individual industrialist. You may get a firm which says it lays more emphasis on getting a factory quickly; they may say 'Give us an advance factory, we have enormous orders;'"— I think we might have got an announcement about an advance factory today. The right hon. Gentleman cannot get the Elgin factory out of his system. Sir Robert continued: —"'let us get going; this is what matters.' Another firm would say, 'This is carefully, calculated, deliberate policy and R.E.P. means a lot to us.' So that I would not care to distinguish between the force of these three incentives, the three incentives being R.E.P., the availability of a factory, and different rate of grants. They are like the three legs of a stool. If you knock any one away, the whole may collapse. I lay almost equal importance on each one of these three. So, the Government have ignored the advice of those who know Scottish industry best. That is why we condemn the Government. There is plenty of evidence in the Report of the Select Committee besides that of Sir Robert Maclean's. For example, evidence was also given by the Chairman of Swan Hunter about the regional employment premium and other forms of aid given by the Labour Government. This is important when one remembers the whole climate of the new philosophy, although it is not a new philosophy, because in 1970 the Tories have caught up with the philosophy which Wolverhampton, South-West had in 1967. It is the philosophy of the hon. Member for South Angus (Mr. Bruce-Gardyne), who is the Parliamentary Private Secretary to the Secretary of State, the philosophy that if lame ducks cannot stand on their own feet, they should be allowed to go.

What effect did that philosophy have on the prospects of industries which are important to Scotland, the motor car industry and the shipbuilding industry, for example, which have been in receipt of considerable help through the Shipbuilding Industry Board or the Industrial Expansion Act, or in other ways? They were rescued by the Labour Government which made the money available to them. That speech guaranteed not to help them in their fight for strength and viability. I hope that the Secretary of State will assure us that he and the Government will fight to ensure the viability and continued existence of industries which are important to Scotland, and to do that he will need to do more than merely tinker with special development area status.

I come next to I.D.C.s. I am surprised that the hon. Member for Ayr (Mr. Younger) is still a member of the Government. He is becoming nearly as bad as the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor) at swallowing his speeches. It must be difficult for some of these hon. Members to live with their past. He is a signatory of the Report. The whole subject of I.D.C.s is discussed on page 61 and the conclusion is that which was reached by people who studied the position a long time ago—that one of the factors of a successful regional policy is the maintenance of tight I.D.C. control.

The hon. Member for Ayr said that Scotland should not be worried because in the South-East and the London area and the West Midlands the I.D.C. limits had been raised from 3,000 to 5,000 sq. ft., and outside those areas from 5,000 to 10,000 sq. ft., because no application within those brackets had been turned down. He did not say how many applications had not been made because of the existence of the limits. He must know that if he raises the limits, there will be pressure to go even further. Before long, the C.B.I. policy, which is to get rid of the I.D.C.s altogether and to allow industry to make its own choice, will be found acceptable for the whole of trade and industry. I cannot believe that any Secretary of State for Scotland would agree to that. I hope that I may give the right hon. Gentleman credit for fighting.

However, the credibility of the hon. Member for Ayr comes into this matter, for he signed the Report on 13th May and it says: We would be strongly opposed to a relaxation of the I.D.C. scheme. There are no doubts about that.

The fact that the statistics do not give incontrovertible grounds for regarding I.D.C.s as an effective incentive to move to a Development Area could indeed mean that the scheme needs to be strengthened or more rigorously applied. That was the advice of the Scottish Select Committee. But the Secretary of State paid no attention to that advice. He brushed it aside and now he wonders why we condemn him.

We believe that the new policy will significantly affect the movement of industry to the intermediate or development areas. The right hon. Gentleman is pursuing a policy which must make areas dependent on maximising the amount of industry which may be steered there. It does not add up or make sense. He has not been fair with the House about the amount of work which has been done by the Select Committee, and he has not been fair about what has been achieved. The right hon. Gentleman made much play with the unemployment figures. The Committee considered the subject of the loss of jobs. This, too, was signed by the hon. Member for Ayr. I imagine that he believed what he was signing. On pages 88 and 89, he will find what the Committee had to say about the loss of jobs. The Committee pointed out that the kind of jobs lost could be the kind that Scotland would need to lose. That was implicit in some of the policies announced in the Beeching Plan, and one of the last statements which John Maclay made in the House was about closures to come in the mining industry. From 1964 to 1969, agriculture lost about 20,000 jobs. Do we want those jobs back, or was the decline an improvement in the efficiency of agriculture? About 20,000 were lost in mining and about 20,000 on the railways-I can imagine the right hon. Gentleman racing to end the closure proposal in his own area in the north of Scotland.

This kind of process accompanies rationalisation. Our forecast of the number of new jobs was well up to the mark and we achieved what we expected to get in the number of new jobs and we were able to insulate the Scottish economy from the worst effects of the measures which had to be taken to deal with the Tory legacy of a balance of payments deficit of £800 million.

Mr. Brewis rose——

Mr. Ross

I hope that the hon. Gentleman will allow me to finish the argument; it is a rather contorted argument, but it is not assisted by intervention.

The Report shows that, but for the measures we took, the fall in the number of jobs in Scotland would have been even greater. The Report says that but for the measures to insulate Scotland and other development areas from the effects of the policy of economic restraint, the figures for unemployment in Scotland would have been much greater. The hon. Member for Ayr and his colleagues signed a Report which was the result of two years' work and then he comes to the House and denies everything he signed in this calculated, considered Report.

Mr. MacArthur

Will the hon. Gentleman give way?

Mr. Ross

I have taken a long time. If the hon. Gentleman likes, I will tell him what he wants to say. He is mesmerised by the figure of 82,000. He is a drug addict. He has a capacity for looking facts and figures straight in the face and then looking beyond them and through them. I call it Perthshire blindness.

Mr. MacArthur rose——

Mr. Ross

The hon. Gentleman will get his chance to speak; we have heard it all.

Mr. MacArthur

The right hon. Gentleman has heard nothing yet.

Mr. Ross

About 10,000 jobs were lost in domestic service. These were the wonderful jobs in Scotland which the Tories would have preserved. They say that we should not have gone in for light industry and computers and so on, but should have concentrated on domestic servants for the lairds.

Mr. MacArthur

On a point of order. We are now in looking-glass-land. If the right hon. Gentleman is courteous enough to answer suspected questions now, will he not allow me first to put the questions so that the answers may have greater relevance to what I propose to put to the right hon. Gentleman?

Mr. Speaker

I do not recognise any matter of order in that.

Mr. Ross

Nice to have you on my side, Mr. Speaker.

Mr. Speaker

I must bring the right hon. Gentleman away from that view. I am strictly impartial.

Mr. Ross

The position is that once again we saw a run-down of the heavy industries in Scotland——

Mr. MacArthur

Why?

Hon. Members

Grow up.

Mr. Ross

There was a run-down of the old industries, which were replaced by lighter industries.

Mr. MacArthur

Read the Report.

Mr. Ross

I am reading it. The hon. Gentleman should read it and he would appreciate the position. We have youngsters staying on at school over the age of 15. I suppose that they should have left school and done milk and paper rounds. These jobs have gone, thank goodness. Youngsters are staying on at school, getting better qualifications for better jobs. We have more students; we have 2,000 more students in our technical colleges. If we take our colleges of education and universities, we can add another 12,000. Add to that the number of people over 65 and altogether there is a figure of 41,000. What the hon. Gentleman does not appreciate is that the older industries had begun to decline——

Mr. Younger

Can I help the right hon. Gentleman?

Mr. Ross

If I ever wanted the help of the hon. Gentleman it would be the last thing that I would take.

Mr. Younger rose——

Mr. Ross

No, I am sorry I will not give way. The hon. Gentleman accused me of being something the other night which is contrary to the order of the House of Commons. He did not withdraw it, and I have no intention of giving way.

We come to the point when we have to ask whether I have justified the last part of the Amendment: — weaken industrial development certificate control and reduce the level of regional assistance given general acceptance in the Report. I do not think there is any doubt, when we take R.E.P., investment grants and the rest of it, that the difference will be made up by the Local Employment Act. We have experienced the Local Employment Act. The last time it was changed was 1960. Scottish unemployment was 4.4 per cent., and three years later after these great improvement, it was 7.7 per cent. The position in the Scottish development area was worse than when they started.

The hon. Gentleman forgets this but he had better learn by heart that for 18 months, from the winter of 1962 right through the whole of 1963 and the spring of 1964 the average unemployment rate in Scotland was over 100,000 per month. That was the achievement of hon. Gentlemen. The result was that the other thing that we inherited was a net emigration rate running at 45,000 a year. When we left office we had halved that, bringing it down to 21,000. Hon. Gentlemen opposite cannot run away from their past. Their past has been a history of saving money on regional development and allowing big business to make its own decisions unhampered by intervention from the centre.

This has been bolstered up by the Secretary of State for Trade and Industry. It was on 30th September when he announced his new measures, and said he would not ram down the throat of industry things it did not want. He said he would consult industry and do what it wanted. Industry wants to stay where it is. Industry is concerned only with itself and it has no responsibility for the welfare for the people of Scotland.

What we require is a ruthless treatment of I.D.C.s. We require an incentive scheme which will stand up to the demands of the area, not one meant to suit the taxation needs of industry, and we require a level of assistance which was envisaged by this Report as being presently just about right in the circumstances. Hon. Gentlemen have a lot to answer for. The right hon. Gentleman cannot write off the fact that employment was rising when we left office. He has been there for over seven months now. As a member of the Cabinet he has a partial responsibility for an economic policy which is leading to economic muddle. The Government have not solved the problem of inflation and are not likely to. They have scrapped anything they had which could help them control prices and they must accept responsibility for this.

I will end with a comment from Monday's Financial Times, which said: …industry will have to be given greater grounds for confidence if investment is to revive. There is no confidence in the future of the economy and of this country under this Government. That is why we have taken the exceptional step of taking note of the work of our colleagues, not merely regretting that the Government have paid no attention to it but condemning them for what they have done.

Mr. Speaker

Before I call the next hon. Member I would ask hon. Members to be as short as possible. I have a long list of speakers.

Mr. Lawson

On a point of order. The point that I wish to raise, which has been raised by other of my hon. Friends, has to do with the practice of arranging a list of speakers before a debate continues, encouraging Members to send in their names and on this basis having a debate that is already cut and dried before it begins. Hon. Members on both sides who do not like this practice feel that there is no sense in their being here at all. If their names are not down, if they have not sent in their names, there is no chance of their being called. May I say that for my part, and I am sure that many hon. Members feel the same way, I deprecate this practice and should like to go back to the situation whereby we took our chance without this list of names?

Mr. Speaker

I agree very much with what the hon. Member has said. It is true that some hon. Members send in their names but I certainly do not make up my mind until I have seen what is happening in the Chamber and have seen who is getting up to catch my eye.

Mr. John Rankin (Glasgow, Provan)

Further to that point of order. On various occasions we have heard Speakers urge those who hope to be called to speak as briefly as possible. We have already listened to two speeches which I am certain were as short as possible. I wonder whether you could give some guidance on what you mean by "as short as possible"? Is it 10 minutes, 15 minutes, before a Member should pack up?

Mr. Speaker

There was a report from the Select Committee on Procedure which suggested that any member on the back benches should be able to compress his thoughts and ideas into 15 minutes, to the advantage of the House. That was a guide given by the Select Committee which was not, however, accepted by the House.

Mr. James Dempsey (Coatbridge and Airdrie)

Further to the point of order of my hon. Friend the Member for Motherwell (Mr. Lawson). May I draw your attention, Mr. Speaker, to the fact that many Members who send in their names feel that they have a much better prospect of being called to speak than those who have not gone to the trouble of doing so? As one who never goes to the trouble of doing so, may I point out that it is not because of disinterest. I am very interested in these matters. Would it not be worth while considering dispensing with the practice of Members sending in their names and letting us take our chance?

Mr. Speaker

I cannot prevent Members from writing to me asking to be called or writing to me complaining that they have not been called. The only advantage of a list is that it enables the Chair to ascertain how frequently Members have intervened in debates before and to try to call Members who have not done so.

5.40 p.m.

Lieut.-Colonel Colin Mitchell (Aberdeenshire, West)

I shall be very brief. I sent in my name in the hope of intervening at the end of the debate when we had discussed the problems of Central Scotland and I should be able to say that the North-East had been neglected once again. I am sure that what I say will apply equally at twenty to ten tonight.

The problems of North-East Scotland tend to be overshadowed by the noiser debate on and noiser debaters from Central Scotland. I was slightly disappointed to learn that we have a new special development area there because even more time of Scottish Committees and meetings will be taken up discussing the Central Lowlands.

In those parts of the country from which a few of us come there is a feeling that industrial expansion, although it is paramount, has possibly got in front of a Government attitude which applies equally to this Government as to the last Government, that regional development has lost its social objective, and paradoxically, in the north-east of Scotland, agriculture and the preservation of the rural economy might well prove by the 21st century to have been a better long-term bet than some of the indiscriminate industrial expansion which is taking place today. When we hear the use on political platforms of phrases like "the quality of life", "leisure", "the requirements of tourism", and "the coming century of better communications", I like to think that the urban jungles which many of my hon. Friends represent are on the decline.

In the North-East industrial expansion simply means the word "jobs", and the rate of unemployment, the low activity rate, especially among women, and the widespread use of labour at low levels of productivity are extremely relevant to plans for attracting and expanding industries in the North-East.

I have already appealed to my right hon. Friend about the location of central Government offices in the North-East, and, as an ex-military man starting at the bottom of politics instead of in the conventional military way at the top, I should like to put in a plea to bring more commercial life to North-East Scotland by stationing and training Army units recruited in Scotland in our part of the country. Why should Salisbury Plain get all the money which could well be going into Aberdeen and other places in the North, like Inverness?

May I say as a newcomer to local politics that housing renewal and urban redevelopment must be placed squarely in the context of regional development. It is tragic that the extreme policies being followed in the North-East are deliberately running down our rural areas on the false assumption that the population will in this way be redistributed towards the major growth centres.

Those of us who have read and studied the Gaskin Report know that the North-East has been told that it can support only two main zones of concentration—from the outskirts of suburban Aberdeen running along the Lower Don Valley to Inverurie, and, secondly, the area around Elgin, Forres, Buckie and Keith. But this is at the expense of our other smaller, but viable centres of population. I believe, however, that the overall economy of our area is unlikely to be stabilised by this over-selective policy, and the conclusion of the Gaskin Report was that it is such stability towards which we should be working.

It is wrong deliberately to run down the villages and smaller towns. It is wrong to hasten the decline of any village or town in the North-East which has the ability to remain reasonably viable in its own right, or which could even serve as an attractive satellite or dormitory settlement for some of the larger centres.

A policy of concentrating population in fewer larger villages, if carried to the extreme, will do more harm than good. In my village, apart from the rise in the school population when I moved in with my family, it is the presence of a distillery which provides exactly 60 per cent. of the children in the school. But for this distillery the school would be closed. We have heard a plea for the children living in the terrible conditions in Glasgow which I well know and which I agree are disgraceful. These are the children who will be the work force of Scotland later in this century. If they are well-distributed, as they are now, in the North-East, this is an aid to both economic expansion and a better way of life.

The contraction of employment in agriculture in the North-East has gone far enough. Expansion in the agricultural industry should be sought just as much as it is in the heavy industries which have been discussed today. Perhaps the new policy on the rating of intensive livestock units will help. Retaining good agricultural land at the expense of attracting suitable sites for building and factory expansion is important in this context.

I believe—and I am glad to have been able to say this at an early stage because I shall be having my supper when other hon. Members are waiting to speak—that the North-East must be preserved in its unique entirety as far as possible and that social engineering—the dreaded phrase used in the books—which tends to ignore the importance of rural communities is short-sighted.

In Aberdeenshire we do not cry for the moon. But it is a terrible reflection on man's folly to be thinking in terms of settlement on the moon in the 21st century when the land mass at our very doorstep is being neglected.

5.48 p.m.

Mr. John Robertson (Paisley)

I shall not take up the remarks of the hon. and gallant Member for Aberdeenshire, West (Lieut.-Col. Mitchell). I am sure that we are happy to leave the North-East to him—at least as much of it as my party is prepared to leave to him. I found his speech very refreshing, but I wonder what the occupants of the Government Front Bench thought about it.

If the Secretary of State had dared to speak to the Report we might have had a much more interesting debate. Instead of that we have had a knockabout. I have been waiting seven months to hear what the right hon. Gentleman will do. We went in a delegation to see him and to ask him what he proposed to do. We said, "There is a problem. What will you do about it?". He said, "It is not my fault. The problem was there when I took office". We have not yet heard what he proposes to do about it.

Today we heard about special aid to Glasgow, but how many more jobs will that create? I have just heard, and I am very thankful to hear it, although I do not know the truth of it, that U.C.S. are not going into liquidation. What relief that will create. That is the message that has just been delivered to me. It may be true or it may not, but it is at least some relief till we get some official news.

Good gracious, imagine what happened today. We wait anxiously for the Scottish Office to tell us something of what is happening, but no news do we get. The Government do not know. There are those 80,000 jobs they talk about. They do not know where they have gone. They spend a lot of time chasing them but they do not know where they have gone. Meantime we are not just losing jobs in pits, in agriculture, in shipbuilding, on the railways, but we are losing jobs in the new electronic industries, in the new science-based industries which we have brought at so much expense up to Scotland. That is where we are suffering injury now, not in the old industries which were dying anyway, but in the new industries which were being brought to Scotland. Not a word did we hear about them today.

The Government seem quite happy to say that all these difficulties and problems were somebody else's fault. If hon. and right hon. Gentlemen opposite had taken the trouble to read the Report we produced at a good deal of trouble and some considerable expense to somebody or another, because we journeyed to all kinds of places, for instance, to Inverness where we did very well, and I shall be happy to go there again, that speech which we heard from the right hon. Gentleman today could never have been made. Hon. Members opposite have not read the Report and have not read the evidence in it.

One or two hon. Gentlemen opposite endorse the Report, and, indeed, so much of it is theirs, and recommendations of theirs are contained in the Report, but what do the Government say about it? All they significantly say about it is that they have not read it. That is what they have actually said. That is the significant point. That is the point made in the speech we heard from that Front Bench today: "We did not bother to read it".

Nor is there any use in their saying that the reasons for the closures and for the redundancies all arose from what happened before last June. It is probably true that these difficulties are due to things which happened before last June, because, for one thing, the right hon. Gentleman was stumping the country telling us what was going to happen if the Tory Party were not elected in June, and that was enough to frighten anybody away. There was that famous speech in Perth. Possibly hon. Members opposite do not remember it. If they do not remember it the industrialists in Scotland remembered it, and they acted accordingly. They started then to make decisions not to invest in Scotland, and that has been going on ever since. We went into the evidence and questioned a great many people about it, industrialists in Scotland, people with expert knowledge.

Although it is probably true that there were errors of policy which could be legitimately criticised, as I have myself criticised them, the last Administration at least attempted to find a whole solution of the problem. One could disagree with parts of it. Indeed, it can be seen from the evidence that there were some disagreements with this or that or another part, but everyone agreed that there was at least an attempt to grapple with the problem—not a problem which has arisen since 1964, but a problem which has been with us for hundreds of years, and with which the people of the Tory Party and in Tory Governments had failed to grapple through all that time, not only in the 13 terrible years, the 13 wasted years, but for years and years before that, during which we had this dreadful problem in Scotland. I know something about it, because I had to spend many years of unemployment in Scotland. At least there was by the last Administration an attempt to find a regional policy, even thought it did not do all the things it was supposed to do. What have we got now? If right hon. and hon. Gentlemen oposite have come along and said, "The policies of the last Administration have not been successful. They failed, and consequently here we are with a new kind of policy which will succeed", I would have been happier than I feel now, because all that the right hon. Gentleman did was to make a knockabout speech telling us nothing at all, except that he mentioned three schemes. Of the scale and detail of them we know nothing so that we cannot apply them to the problem, we cannot assess them. No one who heard that speech today can see very much future for Scotland or the Scottish people. It frightens me. It is far too serious a matter for just a party knockabout speech.

I had a special interest in the Committee's work, particularly about training of young people, although, of course, with adult retraining, too. Although there were weaknesses there, too, the picture was pleasing. For instance, the number of children leaving school with certificates was increasing and increasing significantly; and the number of young people taking training was also rising. Industry itself did not want too much specialised education and would rather recruit people with a broadly based education, and it would seem that they were the kind of people we were sending out.

The problem is that if we train a youngster, in the North-East or in a Border rural area, where there is no industry or factory in his immediate neighbourhood, it is very difficult to find him other than a dead-end job. He has to take whatever job is available even though his ability and aptitudes fit him for something much better. Even so, there were signs that the training boards recognised this problem, and they tried to set up schemes for training way up in the north of Scotland for boys and girls even though, at that point in time, they could not be employed in industry there. Industries recruited in the north and made arrangements to bring boys and girls down south or into the midlands of Scotland and give them the necessary training. We were making progress.

Two things bother me a bit now. The run-down of industry means that there will be fewer places for the trainees. It means that the needs of industry for the trainees are a great deal less than they were two years ago. Secondly, there is a fall off in adult training.

Moreover, with the cuts or probable cuts in the educational programme, training centres will not be expanded to meet the needs there are. The suggestion is being made that, when the school leaving age is raised to 16, pupils should be attending further education classes at least one day, or perhaps two days, a week, and that means that valuable places will be taken up which could be occupied by people from industry. So we can expect to find some problem over day release classes, though I hope it will not happen.

The great weakness of all the planning and thinking about regional policy is the complete lack of manpower forecasting, without which the right decisions on training, education and many other matters cannot be made. Unless the Government get down to this aspect we shall never give the right training to the right people in the right quantity at the right time.

Our investigation was a preliminary run to discover the scope of the question before us, and the breadth of our inquiry was narrow. What we need now, on the basis of this first Report, is for the Committee to be reconstituted to go in greater depth into some aspects of the matters raised in the Report, and to come to conclusions. I enjoyed my time on the Committee and I hope that it will be reconstituted so that we can continue with this job.

6.0 p.m.

Mr. John Brewis (Galloway)

I am glad to follow the hon. Member for Paisley (Mr. John Robertson), who did such a valuable job as chairman of the sub-committee which looked into industrial training, but I am sorry that the debate on the Select Committee's Report should have had a Motion of censure put down upon it, because a Motion of censure brings out the worst in all hon. Members representing Scottish constituencies, and we shall not be able fully to discuss the Report. It would have been much better if the Opposition had used a Supply Day if they thought that this was a subject on which a debate was worth while. The right hon. Member for Kilmarnock (Mr. Ross) juggled with figures to try to hide the actual facts, and told us that the redundancies which would occur were already known. His approach seems incredible when one looks at the figures given in his White Paper on the Scottish Economy, 1965–70 (Cmnd. 2864), when he estimated a yearly increase of 10,000 jobs. I find it extraordinary that anyone should say that the previous Government's measures for encouraging industry were comprehensive when they brought in selective employment tax, put up transport costs, which are so immensely important in Scotland, and discriminated against the service industries. Experience shows that regional policy and jobs depend on a satisfactory growth rate in the economy, which the last Government singularly failed to achieve during most of their term of office. When the economy is buoyant and industry sees good investment opportunities, the development areas benefit.

All parties are convinced of the importance of regional development, but we must see that the package of inducements is right to take advantage of the upturn of the economy. The Labour Party's failure was not that it did not give sufficient attention to regional development but that it failed gruesomely in the way in which it ran the national economy.

I do not want to spend much time on the change which has been made from investment grants to free depreciation. The reasons for the change are given in paragraph 2 of the White Paper "Investment Incentives", which was published in October, and they seem good reasons to me. The previous scheme favoured capital intensive industries. It was not tied to employment. Taking the projection up to 1974 and 1975 which is in the appendix, it is calculated that the cost would have been the huge sum of £725 million. The Conservative Government think that free depreciation will be cheaper and equally effective. When it was originally introduced in 1963 its reception was encouraging. Speaking from memory, in the first half year of 1964 there were four times as many applications for I.D.C.s in development districts as there were before.

Mr. Douglas

The hon. Gentleman is talking about free depreciation in the context of letting the national economy grow to achieve a growth rate at that period of 6 per cent. Is he saying that he will let the United Kingdom economy grow to get a 6 per cent. growth rate, because that is the only way under free depreciation to get growth of industry in Scotland?

Mr. Brewis

I am afraid I cannot follow the hon. Gentleman's argument, but if he catches your eye, Mr. Speaker, he may be able to elaborate it.

The Select Committee heard a certain amount of evidence from industrialists that they preferred free depreciation, and this has been reinforced by the inquiry of the Department of Trade and Industry which was announced in a Written Answer on 14th December. This showed that 60 per cent. of the industrialists questioned, representing 60 per cent. of the amount invested, preferred free depreciation, while 20 per cent., representing 35 per cent. of investment, preferred industrial development grants. We must take into account the views not so much of academics and theoreticians but of the people who will establish industries in the regions.

Mr. Dempsey

Will the hon. Gentleman say how many industrialists were circularised and what percentage that was of all the industrialists in Scotland?

Mr. Brewis

I cannot say offhand, but I think from memory about 300 firms were circularised of which about 45 per cent. responded. The rest were followed up and interviewed. If the hon. Gentleman will look at the answer he will get the figures.

I should like to raise one question. What is to happen to firms starting up for the first time in Scotland and foreign firms coming to Scotland who have no British record of profits? Even if they get assistance under the Local Employment Acts, will that be equal to 100 per cent. free depreciation? Assistance under the Local Employment Acts is tied to the provision of so much employment for so much grant. With a capital intensive industry, might not a British firm like I.C.I., which has a profit record against which it can set free depreciation, be in a much better position than, say, a competing American or Common Market firm which would not have a profit record and might not get the grant in a capital intensive industry because the amount required was more than the limit of so much per job?

I turn to the other inducements, negative and positive, which we considered in the Select Committee. The evidence we had from the Scottish Office was that the I.D.C. system was a vital system of control. I do not question this, but I wonder how effective it is. Obviously, the officials of the Department of Trade and Industry have to exercise their discretion, bearing in mind the overriding importance of the national economy. The number of I.D.Cs refused in non-development areas seems disappointingly small. Between 1965 and 1968 during the term of the previous Government, 90 per cent. by number and 85 per cent. by floor area in the South-East and Midlands of England were granted. The right hon. Member for Kilmarnock said that it was necessary to have ruthless treatment of I.D.Cs, but by 1969 the figures were worse—92 per cent. by number and 88 per cent. by floor area were granted.

I admit that these figures may be misleading, but we must bear in mind that a company could find vacant premises even in the centre of London and at the moment move into those premises without an industrial development certificate. Certainly the advertisements in the Financial Times or the Economist for new premises in industrial estates in the Midlands show that I.D.C.s are not so hard to get as they ought to be.

Mr. John Robertson

Is the hon. Gentleman now saying that we could scrap I.D.Cs altogether, or that we should put forward a tougher I.D.C. policy? The Committee recommended a tougher policy in this respect.

Mr. Brewis

I think we are in agreement on this. I am not recommending the scrapping of I.D.Cs. It is relevant in showing the comparative ineffectiveness of I.D.Cs that no other developed Western European country, with perhaps one exception, has adopted this system. Clearly the I.D.C. system needs reinforcement.

I wish to draw the Government's attention to the cost of congestion. We discovered in the Committee that no study had been carried out on this matter either by the Labour Government or by any other Government, except possibly by the Ministry of Transport in connection with motor cars. If people migrate from Scotland or Wales to seek work in the English Midlands, the cost of building new houses and of providing the social infrastructure will be great indeed. I personally recommend that thought should be given to the dissenting note in the Hunt Report by Professor Brown, in which he recommends a congestion tax. I cannot obviously enter into the arguments he deploys in that Report, but they are also to be found in the Report of the Select Committee. Such a tax might take the form of a graduated payroll tax and be phased to replace S.E.T. and probably regional employment premium as well. But such a tax would not discriminate against the service industries which can make a contribution to providing employment in Scotland.

We know the stock answer: "Why give inducements for a new shop to open up in the High Street which will take away custom from an existing shop?" But the service industries mean much more than just the retail trade. Merchant banks and insurance companies, for example, are heavily concentrated in London, which is the main financial centre of our country, but some 15 per cent. of financial business in the United Kingdom is transacted in Edinburgh. The logic of the suggestion I am putting forward is that Edinburgh should no longer be excluded from development area status. Much more study needs to be done of the service industries. We heard evidence from Professor Wilson of Glasgow University. It is interesting to see that the Highland Development Board has the power to encourage service industries in its area. I believe I am right in saying 60 per cent. of the new jobs in the Highlands are not in manufacturing.

I welcome the extension of the new tax allowances announced by the Government to the service industries. Scottish Members of Parliament who represent development areas have not perhaps realised that their constituencies are not now so near the top of the queue in the hierarchy for assistance. The first and the highest rank is the extra inducement given to industry in Northern Ireland; then there is the Highland Development Board, which has its edge; then there are special development districts, about which we have had a further announcement today, and which in general I very much welcome. Only fourthly do we come to the ordinary development areas, and competing to a certain extent with them are the intermediate areas. In fact, there are areas that are development areas with problems equal to or worse than the situation in the Highlands.

I turn to the Report, "A Strategy for South West Scotland" which covers the area I represent. Paragraph 4 says Since 1965, however, the rate of decline in population has worsened because of higher migration and lower natural increase. At the same time unemployment has risen in absolute numbers and in relation to the Scottish average. It then mentions the male unemployment level as now one and a half times the Scottish average and two and a half times the United Kingdom rate. On page 10, dealing with the Machars of Wigtownshire, it says it is clear that unless special measures are taken a continuing serious decline must be expected. Certainly the unemployment figures are alarming. Male unemployment between 1966 and 1969 in Newton Stewart has gone up from 6.6 per cent. to 7.9 per cent. but that covers over 15 per cent. unemployment in the Whithorn area; in Stranraer the figure has gone up from 7.3 per cent, to 9.9 per cent.; in Sanquhar from 6.7 per cent. to 25.6 per cent.; and in Girvan from 5.9 per cent. to 10.6 per cent. The last two localities are special development areas, but it is surely intolerable that there should be 9.9 per cent. and probably higher unemployment in the Stranraer area now and that it should not be given special development area status.

I argued for this status for a long time when the Labour Government were in power, but was always told that such status could only be given to colliery areas. I therefore welcome the extension of the principle announced by my right hon. Friend today. But there is an alternative. Let us make more use of the Development Commission and give that Commission the same sorts of powers and edge in rural areas as has been given to the Highland Development Board. At present the Development Commission works mostly in Mid-Wales. Why should it not come to some of the rural areas in Scotland?

We had some exchanges in the Select Committee about small industries being allowed to go to Glasgow and other big towns. Such factories employing a dozen or two dozen workers can make negligible contributions to a big town, but they could transform the position in a rural area. Let us have a conscious policy of keeping such factories away from cities and give an edge to the Development Commission so that it can get on with the job.

I hope that the Government will take up some of these points, all of which were discussed in the Select Committee. They do not add up to a greatly increased expenditure. Indeed, if a congestion tax were adopted, it might reduce Government expenditure. I am convinced that we must have the right packet of inducements available to offer when the economy swings up again so that we can obtain the maximum advantage.

6.19 p.m.

Mr. William Hamilton (Fife, West)

The hon. Member for Galloway (Mr. Brewis) always speaks with a good deal of reason, and we would not disagree with much of what he says. The difference between his speech and that of the Secretary of State for Scotland is that at least the hon. Gentleman addressed himself to the Report which we are supposed to be debating. Our objection was to the fact that the Secretary of State dealt a calculated insult to the Committee.

The point was well made by the former Secretary of State, my right hon. Friend the Member for Kilmarnock (Mr. Ross), in a devastating exposé of the case, not only of what the Labour Government did, but of what the present Government are not doing. After hearing the Secretary of State, we begin to understand why he is coy and shy about making speeches in the House. If he is going to make that kind of speech, I hope he will stay away more often. It was no contribution to solving the problems that we are discussing. We can bandy figures around to prove that one Government was worse or better than another. The Secretary of State quoted the July, 1970, figure of 93,000 unemployed. I quickly looked up the figure for July, 1963; it was over 94,000. Where does one go from there? What is the object of making that kind of point?

I was interested in what the Secretary of State said about the need to improve infrastructure. The Conservative Party made this point at the General Election. The figures of public expenditure in the White Paper show how promises are matched by performance. Taking the housing figure, which I endeavoured to quote at Question Time today, one finds that projected public expenditure on housing is virtually the same for 1969–70 and 1974–75. This can only impose a cut in the total number of houses or a massive cut in the subsidies, or both. The Secretary of State steadily refutes these charges. He refused to answer my hon. Friend's question today. My hon. Friend did not ask for a target for housing, but whether the present Government would exceed in any one year during which they are in power the figure of 44,000 which we achieved last year.

The same applies to other infrastructure matters. For example, the figure in the White Paper for expenditure on education is, in round figures, £240 million in 1969–70 and £271 million in 1974–75. Presumably all of that is devoted to the additional expenses due to the raising of the school leaving age. What real improvement will there be in education in Scotland, which plays a very large part in its future economic well being?

What will be the future of the Select Committee? Anyone in Scotland who reads the Report will admit that nowhere at any time has such an investigation in depth of the Scottish economy taken place. It is almost incredible that we should have a virtually unanimous report from that Committee with one exception—and we all know what happened to her. We can commend ourselves that the Committee took such an objective view of the Scottish economy. Why then is the Government so chary about setting up the Committee this Session. We appreciate their difficulties as to both numbers and ability on their side to man the Committee. But they can rest assured that we shall object strongly if there are members from the other place on the Committee, for they have nothing whatever to do with us. Anyone who reads the debate on the Scottish Highlands which took place last week in the other place must realise the depths which the Conservative Party would plumb if it appointed gentlemen from that place to a Committee examining the Scottish economy.

I want to refer briefly to the appointment of the hon. Member for Ayr (Mr. Younger) to the office that he now occupies. He made reference the other night to the part which I played in a debate some two years ago. That was entirely a matter of private enterprise. which I believe in—in this place anyhow. I was under no pressure from anybody. I did that entirely off my own bat and I take full responsibility for it. What I was endeavouring to do then—I hope with success, and the Scottish people evidently believed it—was to defend the record of the Labour Government over the years. The hon. Member for Ayr has had as bad a Press in Scotland about the alibis which he has produced for his lack of activity over the last six months as the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor), who is a Common Marketeer and has done an about-turn on just about everything.

On regional policies in general, I agree with the hon. Member for Galloway that a buoyant economy overall is of far more significance than any incentives which any Government use to achieve regional differentiation. But there is much evidence that the Government's plans for regional development will have to be completely overhauled, even before they get off the ground.

In an article in the Sunday Times of 24th January Malcolm Crawford, the Economics Editor, wrote: Whitehall slates Tory regional plan. Conservative plans for regional policy are having to be completely re-thought as a result of criticisms contained in a confidential Whitehall study, which the new Government ordered when it took office. In view of the Government's commitment to abolish the £100 million a year regional employment premium in 1974 and its scaling down of capital plant incentives for development areas (by abolishing investment grants) the report concludes that additional support for depressed areas, in some form or other, will be needed if these regions are not to go rapidly downhill. This is a report which has been presented to the Government by experts in Whitehall. The article continues: Tory policy is, in theory, to give whatever stimuli depressed regions need in the form of 'infrastructure' spending (public construction projects). But the departmental study is sceptical about the usefulness of this as a substitute for grants to industry. Infrastructure spending takes much longer to attract industry to a depressed area, officials hold, and the amount of money required to attract industry is much greater in terms of real resource costs. There is no evidence in the White Paper on public expenditure that the Government accept that proposition. I want to know whether we shall see that report from officials in Whitehall which has been presented to Ministers and which directly challenges the efficacy of the Government's regional policy. The House has a right to see this assessment by Whitehall officials.

Scotland is in for some extremely rough weather in the next two or three years if the Government persist pig-headedly in their new pursuit. We can see it in Glenrothes. We have lost many jobs there in the last six months. There is a fear that American dumping of electronic components is losing us a lot of new jobs in Glenrothes and other towns. There is growing concern at the lack of clear Government policy. We understand that we shall be having a White Paper on regional policy. I do not know when that will come, but meanwhile the uncertainty is growing. Investment is virtually standing still. Unemployment has reached 100,000 men. That is significant. Never in any month in the six years of Labour Government did the figure reach 100,000. It is significant that in 1963 the average was 105,000, summer, winter, spring and autumn, and that after 12 years of the kinds of policy that the Government are now proposing.

The Secretary of State says that he intends to rely on the Local Employment Acts. I ask him to read the Report of the Estimates Committee which looked into the working of those Acts. That all-party Committee's Report made it very clear that investment was at its lowest when the need was greatest. These are the Acts on which the Government pin their faith. They have learned nothing since that Report was produced. Everyone knows it. Industrial experts, the C.B.I., the T.U.C.—every objective observer of the scene knows it

I come then to the article in the magazine Scotland, from which my right hon. Friend the Member for Kilmarnock (Mr. Ross) quoted. The Under-Secretary of State for Development goes piddling off to Germany and says that German industries will be coming to Scotland. I wager that he will not get one. Perhaps I might make one brief quotation from that article by Mr. Scott Nelson. He says: Cash assistance is the greatest attraction in terms of investment incentive. This is even more true of the foreign investor where the movement of funds and exchange complications make any local contribution to investment costs very acceptable. Of the O.E.C.D. countries Holland, Sweden, Germany, France and Italy give grants to attract private industry to the underdeveloped regions. Denmark and Norway give loan guarantees and Belgium offers cheap finance. All countries except Britain give favourable tax treatment for development area investment. … The overall picture however suggests that the United Kingdom as a whole must lose some ground to the other nations still offering cash grants. And on top of that if the foreign investment is attracted to the United Kingdom the incentives to select a development area rather than elsewhere are not now so strong. Even assuming that the Government attract German industry, which I doubt, the incentives to go to development areas will be less strong than they were under the previous Government. However, because other countries in the O.E.C.D. give grants rather than the kinds of allowance that the Government have in mind, they are not likely to come to this country in any event.

The Government should be taking account of this kind of objective statement of the facts rather than heeding the skinheads in the Department of Trade and Industry. Skinheads there and skinheads from Wolverhampton will make no contribution to the economy of Scotland. We shall never get the kind of growth in Scotland that we want to see unless we pursue policies based on the acceptance of the fact that the economy can be planned. We cannot accept that the free play of market forces can provide the answer. But that is the essence of the policies of this Government.

If the Government allow that alone to influence them in their regional policies, we are in for the roughest time that we have had this century.

6.34 p.m.

Sir John Gilmour (Fife, East)

I was encouraged to hear the hon. Member for Fife, West (Mr. William Hamilton), who represents a constituency which has a fairly strong Left-wing bias, talking so much in favour of private enterprise. That is one of the troubles with the hon. Gentleman: he wants to hedge his bets.

One feature of debates on the Scottish economy which I find extraordinary is how definite people tend to be that they all know the answers. If we knew all the answers, there would be no problems in the Scottish economy. It is the fact that we have to change our policies and learn from experience all the time which makes it even more necessary to conduct a debate of this kind on a constructive level. It is no good hon. Members quoting figures for one year and comparing them with those for another year.

Mr. William Hamilton

The Secretary of State did.

Sir J. Gilmour

My right hon. Friend's reason for doing so was to protect himself against the totally unjustified Amendment moved by the right hon. Member for Kilmarnock (Mr. Ross). That preempts the argument by not wanting to begin the debate on a constructive basis. In this instance, the blame is on both sides. However, if it is done by one side, it must be taken up by the other. The time has come to knock a few heads together and get down to talking sense.

The former Secretary of State seemed certain that all the action taken under his leadership was right. The hon. Member for Fife, West quoted the unemployment figures in Scotland for 1963. However, I am certain that whatever happened to the unemployment figures after 1963 was probably the result of decisions taken back in 1962. That is the sort of time lag that we are dealing with when we discuss whether the number of available jobs is increasing or decreasing.

I do not believe that there is any relevance in the argument that because there happened to be a General Election in June there was a sudden difference to the economy. That is a matter which is tied up with the tenor of trade throughout the world and the number of orders which were on order books six or even nine months ago. It has nothing to do with the change in Government.

The Committee found that it was extremely difficult to pinpoint what it was that helped people. In my view, at the end of the day we shall finish up with a compromise between the two possibilities. When we get down to a consideration of investment grants and tax concessions, it is not easy to decide which is the better. Certain industries will do better with one sort of help. If we go on giving grants to others, we shall merely waste public money. In their case, it would be better to discontinue them.

Mr. Douglas

Is the hon. Gentleman in favour of competition between the different types of incentive offered? Is he pressing his own Front Bench to offer a package of investment grants and tax-based incentives and allow firms to choose between the two?

Sir J. Gilmour

I do not think so, and I will give my reasons later. I will refer to one or two items in the Report and relate them to this point.

There are certain industries which have different problems and, therefore, need to be dealt with in a different way. That does not mean, however, that we should give an industry the opportunity to make its own choice. That would not be in the interests of the taxpayer. When we consider these matters, we must keep in mind all the time that we do not have unlimited money. We want to use the money at our disposal in the most efficient way to produce the desired results.

Turning to the Committee's Report, I want first to refer to paragraph III.4. It says that out of £308.7 million spent in the United Kingdom on support for industry and research and development in 1967–68, the Scottish share was £18.4 million, or only about 6 per cent. It became clear to the Select Committee that money spent on research and development generates jobs and that Scotland is not getting its fair share of research and development. That is one valuable contribution made by the Report, and I hope that my right hon. and hon. Friend will pay due attention to it.

Mr. Richard Buchanan (Glasgow, Springburn)

Is not the hon. Gentleman misreading the Report? Surely the amount spent on research and development in Scotland was about 11 per lent. of the corresponding United Kingdom total, not 6 per cent.

Sir J. Gilmour

The Scottish share was 6 per cent. Scotland has had a great turn-round from industries which were declining. This was another point which came out of the Report. The Scottish Office said that it was able to predict fairly accurately the number of jobs which would be won in new industries, but it failed to predict accurately the run-down in the older industries. This seems to suggest that we need to spend a greater proportion on research and development in areas like Scotland—not only in Scotland—than in other parts of the country. This was one valuable point which came from the Report.

Mr. Lawson

I think that, in fairness, the hon. Gentleman will agree that what emerged was that the industries predicted but failed to predict accurately.

Sir J. Gilmour

That is not entirely true. I should have to look up that point. I shall be glad to admit if I am wrong.

The Scottish Office witnesses said that they had found it easier to assess from what was being processed through the various Ministries about the growth of newer industries, but that they had not been able to make as good a judgment as they would like on the run-down of the older industries. It may be that they were misled by the estimates which were given. Indeed, many of the older industries were losing employment because of definite judgments which were being taken by the Government. In other words, if a squeeze is put on agricultural profits, the result is that fewer people are employed on the land. Therefore, the judgment which the Scottish Office and other people make at the time of a Price Review either accelerates or slows down what happens in this sphere. So it goes on in other industries.

On page 52 of the Report we come back to the point: The C.B.I. (London) considered that the grant exercised a marked influence only where the other benefits of location inside or outside the Development Areas were fairly evenly balanced". What does not come out well enough in the Report is that the grant is very much influenced by the climate of the economy and the rate of interest at which people can borrow money. This has a great effect. This came out later in some of the evidence given to the Committee. A continuing hight rate of interest to be paid on borrowed money probably has a greater effect on slowing down the development of industry than anything else.

Mr. Ross

Surely, when considering the value of grants as against tax allowances, the fact of a 40 per cent. cash grant immediately reduces the amount which has to be borrowed and is prefer. able to an indefinite tax allowance?

Sir J. Gilmour

I agree. I think that the right hon. Gentleman will agree that with a high interest borrowing rate for money the idea of getting a grant becomes increasingly attractive. This seems a matter of straight common sense. It is not easy to look at the matter in isolation and say that grants or other incentives are always better. There are times when the general economic climate of the country would force someone to change. We have to consider not only the industrialist's point of view but what, in the interests of the taxpayer, will get him the best value for money.

There are certain industries where consideration ought to be given to grants. One is the tourist industry. For instance, hotels in the Highlands area in out-of-the-way places with short seasons have to earn a return on their money in four or five months of the year. This type of industry needs its financial requirements to be judged in a different way from a factory which can operate on full capacity for 12 months of the year. That is why there is much to be said for not always saying that this is the only way that it can be done, and for having the possibility of choice so that certain means can be used for supporting certain industries and other means can be used for assisting other industries.

Mr. Brewis

Concerning the hotel which may be empty for seven months of the year, does my hon. Friend agree that some rebate on rates might be the better answer?

Sir J. Gilmour

I very much doubt it. It might be a more effective way of assisting, but I do not think so. The real trouble in the tourist industry, particularly in the remoter areas, is earning enough on the invested capital within a short season. If the investment is cut down by a grant, there is more hope that this can be achieved. I think that is worth considering.

Hon Gentlemen opposite have asked whether the Select Committee should be reappointed. The inquiry was very useful to those who sat on the Committee. It certainly taught us a good deal about how economic planning decisions are made. But, because the inquiry was so broad, it was difficult to pinpoint any way which would enable us to come back to the Government of the day, irrespective of which party was in power, and say "As a result of our deliberations, we believe that this is what should be done." If the Committee is reappointed, it would be more helpful if it could inquire into rather narrower areas which have been neglected in the past and look at certain items. I think that this would enable the Committee, if reconstituted, to carry out its work to the best effect.

6.47 p.m.

Mr. David Lambie (Ayrshire, Central)

I should like to take up the point raised by the hon. Member for Galloway (Mr. Brewis) and also by my hon. Friend the Member for Fife, West (Mr. William Hamilton) about the industrial future of Scotland depending on growth in the United Kingdom economy.

That point is brought out in the Report at page 92, paragraph VII.4, where it states: new industry which comes to Development Areas is certain to be a limited one at any period during which industrial growth in the United Kingdom as a whole is limited. I am depressed that we should have a United Kingdom economy which is not buoyant. The Government's policy will not in the near future make the United Kingdom economy more buoyant. Therefore, as conditions get worse in Britain, the position in Scotland must get much worse.

It is true that a prosperous Scotland is dependent on a prosperous Britain. But it does not automatically follow that a prosperous United Kingdom means a prosperous Scotland. We had fairly substantial growth in the 1950s under a Conservative Government, but that growth did not follow through to Scotland.

My right hon. Friend the Member for Kilmarnock (Mr. Ross) gave figures covering that period. At one stage Scotland reached a figure of over 130,000 unemployed. It also had a net emigration rate of about 50,000 leaving Scotland for the more prosperous areas of the Midlands and south of England and countries like Canada and the United States. Therefore, it does not automatically follow that a prosperous United Kingdom means a prosperous Scotland.

Despite the new developments which took place under the last Labour Government and, to give them some credit, developments which took place during the previous Conservative Government's period of office, the economy of Scotland has been running down. That is not because the new developments have not been coming in. They were coming in in ever-increasing numbers under the Labour Government. We were reaching our targets, but what we did not see was that the old, basic industries of Scotland were declining faster and faster. We were not bringing in new jobs quickly enough to overtake the rundown in the traditional industries.

Moreover, with the modernisation of existing plants and the introduction of automation there has been an automatic decline in the demand for labour. I have heard statements that the electrification of the Carlisle-Glasgow line will mean a loss of 400 jobs; the modernisation of British Rail means an automatic loss of 400 jobs in areas in the South of Scotland that are among the hardest hit by unemployment.

Therefore, we must look for a new base, for new policies to put Scotland on an equal footing with the other areas of the United Kingdom, so that when the next Labour Government gets the British economy going again Scotland will be in the forefront of further development.

The prosperity of Scotland was based on cheap raw materials, on our native products—iron ore, coal, limestone and water. Those were the basic raw materials on which Scotland's heavy industries and her prosperity were built. Unfortunately, the new light engineering and science-based industries, instead of going to the traditional heavy industrial areas, went down to the market areas in the Midlands and Southern England. During the 1950s a triangle was built up of the prosperous Midlands and London area and the depressed heavy industrial areas of North-West England, North-East England, and the industrial areas of Scotland.

Scotland needs a new base to compare with the tremendous attraction of the large market in the Midlands and the south of England. That is why it was very disappointing to hear the Secretary of State's statement today, and to hear him make only a passing reference to the tremendous industrial development that could come from using the deep water facilities on the Clyde. I was very disappointed that he said that even development at Hunterston would give very little immediate aid to the unemployed in Scotland.

The Government have been floating a great winter relief scheme, and the Secretary of State took great credit for it today. The sum of £1¾ million is to be spent on Scotland. The right hon. Gentleman does not know how many jobs that will give us and how he will spend it, but it is to meet all the needs of the unemployed in Scotland—115,000 people.

Mr. Gordon Campbell

I made it clear that it was an emergency scheme to provide help. That is what the deputation of Labour Members who came to see me in September recommended. They agreed that it was limited in what it could do. In answer to Questions and in letters I have indicated the allocation of money to different areas.

Mr. Lambie

The right hon. Gentleman made a great claim in his speech that the £1¾ million would solve the problem, that it would help to provide jobs for the 115,000 unemployed. Yet he is stopping a £40 million development by not giving a decision on the Hunterston inquiry. An American oil company wishes to spend £40 million to build an oil refinery in one of the areas of highest unemployment in Scotland, and the right hon. Gentleman is dithering, not giving any reply. The only information we have is leaked through the national Press. Therefore, I deny the right hon. Gentleman's statement that developments at Hunterston will not give any immediate benefit to the unemployed in Scotland. If he had taken his decision six months ago, as he should have done as the representative of the Scottish people, the refinery would have been under construction now, and 2,000 people would be preparing the land and putting in the services on that site. The total of 2,000 people who would be working but for the Secretary of State's lack of action is greater than the total who will obtain jobs as a result of the £1¾ million relief aid that he has given to the whole of Scotland.

Mr. Gordon Campbell

I could not possibly have taken the decision then, because that was the moment, just under six months ago, when the Report of the inquiry came to me.

Mr. Lambie

It is the right hon. Gentleman's job to make a decision immediately he receives a report that is vital to Scotland. He knows that every individual who took part in the inquiry was given the evidence to consider two or three months before the publication of the Report. The only thing the right hon. Gentleman received about six months ago was the findings of the inquiry. It was his job to make as quick a decision as possible.

Scotland needs a new base. We must have an attraction that no other area in Britain has, and we have it in the deep water facilities in the estuary of the Clyde. It is the only estuary in Britain, and is one of the few estuaries in Western Europe, where the large new super bulk carriers can enter without any dredging and without any danger. During the past two or three months ship after ship has been involved in a collision or near-collision in the Channel. In the Clyde we see the best entry into the United Kingdom not being used because the Secretary of State is not prepared to give a decision that will alienate some of his Tory friends who live in the Hunterston and North Ayrshire area.

I hope that the Under-Secretary of State will reply to this matter truthfully at the end of the debate. It is all right sending men to Germany to obtain work. The Secretary of State should send his hon. Friend to Ayr County Council, who are prepared to go ahead with a project involving £600 million. It is ready for the go-ahead, but the Secretary of State is not prepared to give it.

The need for a decision by the right hon. Gentleman is even more urgent because, according to newspaper reports, the British Steel Corporation, in making its plans for steel development into the 1970s and 1980s, has decided that its first major project will be at Scunthorpe and its second at Redcar. Scotland is not mentioned. Yet at Hunterston we have an area already designated for a new integrated green field site. But unless the right hon. Gentleman speaks up for Scotland we shall not be in the list of priorities now being drawn up by the Corporation.

Mr. James Hamilton (Bothwell)

My hon. Friend is on a very important point for Scotland, the question of steel production. I learnt from a very reliable trade union official last Friday that within the next five years the British Steel Corporation will close five steel plants in Scotland, and that no provision has been made yet to deal with this problem. I have a Question on the Order Paper about this, and I hope that the Government's reply will be that they are fighting to ensure that some of the steel industry is captured for Scotland.

Mr. Lambie

I thank my hon. Friend for that helpful intervention. I will go even further: by 1980 the Scottish steel industry will be liquidated, with only one ancient plant at Ravenscraig remaining.

Here we have a Secretary of State who never makes a statement in Parliament. All the information in Scotland comes through leaks in the Press. We are being governed now by reporters leaking information to the public. Unless the Secretary of State gets off his hind legs, brings back his man from Germany and sends him down to London, where the decisions affecting the future of Scottish steel will be made, Scotland will be bypassed again——

Mr. Paul Hawkins (Norfolk, South-West)

Not so.

Mr. Lambie

It is all right for the hon. Gentleman, from his seat at the end of the Front Bench, to say that it is not true. He represents an English constituency. The Secretary of State and I represent Scottish constituencies, and want a voice in the future of Scottish steel.

I read in The Scotsman last week that the Secretary of State had received a memorandum prepared by the Department of Trade and Industry on the developments at Hunterston. He knows that during the Adjournment debate which I had on this I challenged the Under-Secretary to deny that an English Minister was interfering in a Scottish decision. That night he said that what I was saying was not true, and that the Secretary of State would take the decision himself.

Yet within a fortnight we had the Secretary of State's decision, stating that he was delaying making any decision on the Chevron Oil proposal at Huntersdon until he had considered a memorandum from the Department of Trade and Industry. Indeed, we know—not by a statement in the House but again through a leak in the Press—that the Secretary of State has that memorandum and he has said, according to the reporters, that he is not giving out information about the memorandum until he can give information to the objectors.

Mr. Gordon Campbell

The hon. Member is misleading, and I must therefore intervene. Hon. Members can look up what he said in his Adjournment debate. When I took my decisions later, almost everything that he said was proved to be wrong. I decided to postpone the decision on the refinery—it was my decision—because I found that the information on which the reporter's report and recommendations had been based was by then out of date and the best way in which I would get the latest information was from the Department of Trade and Industry. I suggest to the hon. Gentleman that if he reads too much in the newspapers and thinks that it is all correct, he himself will be greatly misled.

Mr. Lambie

If I do not read the newspapers I do not know what is going on, because the Secretary of State never speaks. He never makes a statement in the House. I agree with the Secretary of State that what I said was wrong, but, as a good Scotsman, when I heard that an English Minister was interfering in a Scottish political decision I assumed that he was doing that to harm Scotland.

Unfortunately, we have now to look to the Secretary of State for Trade and Industry for help—the biggest Tory of them all. We have to depend on him to tell the Secretary of State not to come down on this development, that the United Kingdom economy needs it. So that Secretary of State should be here to hear the pleas of the Scottish people. We have some faith in him, because he interfered with the Secretary of State for Scotland. Our only hope is that he acts on his memorandum and overcomes the indecision of the Secretary of State for Scotland.

Mr. James Hamiltonrose—

Mr. Patrick Wolrige-Gordon (Aberdeenshire, East)

Sir Robert——

Mr. Lambie

On a point of order. I had given way to my hon. Friend the Member for Bothwell (Mr. James Hamilton).

Mr. Deputy Speaker

The lion. Member did not indicate what he was doing and his last words sounded like a very good end to a peroration, so I assumed that he had finished. However, if he had not, but was only giving way to his hon. Friend, I would ask the hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) to wait a moment.

Mr. Lambie

On that point, Sir Robert. I have been fair with my time allocation but I think that I am overstepping it now. If you think that that was a good ending to my speech, then I will stop there.

7.5 p.m.

Mr. Patrick Wolrige-Gordon (Aberdeenshire, East)

Whatever the merits or demerits of the hon. Gentleman's peroration, and whether it was his peroration or not—if it was not, what would his peroration have been?—I should like to get back to the matter which we are supposed to be discussing, the Report of the Select Committee. I greatly value the hard work which many hon. and distinguished colleagues have obviously put into it. I do not know whether it is commendation or not, but I shall certainly keep this Report as extremely useful reference material for much of what is going on in Scotland.

However, I must admit that my general reaction was that a good deal of time, effort and probably money had been spent on confirming the general sense of much that is going on at present, and also recognising the general sense of what may be likely in future. I am not surprised at that. Not having been a member of the Committee, I have been struck today by the general desire to get a concensus on the points discussed. I am not surprised at that either, because the average norm of our administration is good common sense, whatever the politicians may get up to. It is only in particular instances that one meets examples of the excessive stupidity or the great brilliance which can be the bane or inspiration of us all. To deal with particular instances like that is hardly the function, and could not be the function, of a Select Committee like this.

That conclusion is, I think, borne out by what the Report says about, for example, the machinery for co-operation between the Scottish Office and those Departments responsible for the whole of Great Britain. It says that that machinery is fully available but not necessarily always used. It is part of our function to see that it is always fully used.

I was glad to have the confirmation of the Committee, in its first paragraph, that economic planning has been the function, whatever it has been called, of Government to a greater or less degree since the 1930s. One might have thought in the early days of the last Labour Government that economic planning was a totally new idea and that all that was needed for the development and success of the Scottish economy was to plan it economically. The truth, of course, is that economic activity has required, and always will require, planning, but it is important to see that the planning does not get totally out of perspective.

I wish to deal with some of the more angled, so to speak, comments in the Report, many of which are particularly interesting. For example, we read in paragraph VII.8 that the then Secretary of State told the Committee that he thought that assistance through regional policy measures had not yet reached the peak that will be necessary; after the peak has been reached, he thought that a high level of assistance would be needed for a considerable number of years before assistance starts to taper off. I am surprised that the Committee did not press the right hon. Gentleman further to find out precisely the sort of figures he would put to that statement and the number of years he would regard as reasonable. I hope that some flesh and blood will be added to the right hon. Gentleman's statement.

We in the North-East feel this question of regional development personally, It is a matter of great moment to us. We tend to look at the central belt of Scotland as a highly developed area of Scotland, though today we hear that a section of it must be made into a special development area. What guarantee do we have —even if the aid going to development areas is extended more than it is at present—that this aid can ever be withdrawn, particularly in view of today's statement?

We read in paragraph III.27 that the Committee were surprised to find that the Board of Trade neither appears to play an important part in decision as to what kind of air services Scotland should have, nor regards itself as closely responsible for identifying the needs of the community or for encouraging the airlines to meet them beyond its function of running some Scottish airports.

I recall that in 1969 I went into great detail about the administration of Scottish airports, and, in particular, into the situation at Aberdeen Airport. At that time considerable dissatisfaction had been expressed and there had been a discussion to see whether a better method could be adopted to overcome the difficulties. The impression I got—and this Report confirms it—was that the Board of Trade had more or less given up all idea of the future development of these airports. Yet Aberdeen and the North-East in an air-conscious part of the world. Whenever I make the journey I find many people travelling by air, even though the service is linked more to the 'fifties in terms of speed and comfort than to the 'seventies.

It appeared then that the Board of Trade was completely uninterested in this subject and unprepared to develop its assets, these airports, and the services that were being provided. While the saga of operational and navigational losses continued, nobody wanted to have a go with this form of communication in Scotland. I hope that one effect of the impact of the present purposive Government, on wherever the Board of Trade has disappeared to in the Ministry of Technology is that the air communication services in Scotland in general and in the North-East in particular will be greatly developed.

Mr. Rankin

Is Aberdeen a municipal airport? If so, what part is the local authority playing, in liaison with the Board of Trade, to maintain and improve the airport?

Mr. Wolrige-Gordon

Aberdeen is not a municipal airport. It is owned, administered and run by the Board of Trade.

I hope that the Board of Trade will be encouraged to develop the opportunities that it has at this and other airports, that B.U.A.-Caledonian will have a chance to come to Aberdeen and that B.E.A. will not turn aside from this captive marked which has indulged it so long but will proceed to put jets on the route and open up the opportunities that undoubtedly exist.

Mr. Robert Hughes (Aberdeen, North)

Can the hon. Gentleman say what happened to Channel Airways, which tried to compete with B.E.A. from Dyce? When I last went to Dyce I did not see the firm operating there.

Mr. Wolrige-Gordon

I am afraid that Channel Airways started rather too soon from the point of view of anybody wanting to take part in private enterprise. I hope that that firm will reconsider the opportunities for private individuals to play a part in developing, expanding and improving air services throughout Scotland and that private firms will have a chance to come back. I hope that Channel Airways did not lose too much money during the repressive era of Socialism.

I have no doubt that communications, and particularly air communications, have an important part to play in Scotland, just as we must pay attention to road communications and haulage generally in our regional development policies. In this connection, we read in the Report that one character from the Scottish C.B.I. estimated that the extra cost of remoteness for Peterhead, which is in my constituency, was such that wages needed to be between 20 per cent. and 30 per cent. lower than in the central belt to make up for the difference. I am sure that the House recognises that to have been an exaggeratedly provincial view, which I am afraid sometimes comes from those in the central belt.

Mr. Ross

Is the hon. Gentleman aware that it is most unfair to call a man of the standing of Mr. Perry, who took considerable trouble to establish a factory in that area, a character? I advise the hon. Gentleman to be rather more careful in choosing his words.

Mr. Wolrige-Gordon

I am sorry that the right hon. Gentleman emphasised the point because the gentleman's name is not given in the Report.

Mr. Ross

But it is given in the evidence.

Mr. Wolrige-Gordon

Quite so.

Nevertheless, one tends to accept too easily this question of a wages differential, with the result that people say of it, "It is just too bad". I submit that if one is prepared to accept wages differentials one should be prepared to accept differentials in transport costs because in the development areas distance means money. This is, therefore, an extremely important factor for our development. Our development is not helped by the men and women of that area having to accept that they should receive much less money for work of the same type and requiring the same skills as that performed by people in the central belt. We must try to redress this imbalance if social justice is to be achieved throughout the whole of Scotland and not just in one part of it.

In the Common Market agriculture is having its prices fixed in relation to a place called Duisburg. Cannot we have something like the same formula in relation to our transport charges? If anyone believes, as I do, that our country gains —Professor Wilson takes this view in IV 57 —from a spread of industry and opportunity, then a transport subvention is our best bet; because what is needed in an area like mine is not so much a subsidy or a loan as a chance to compete on equal terms in the mass markets. This will be true even more for us if we do not enter the Common Market.

Mr. George Watson, the Aberdeen sub-area chairman of the Road Haulage Association, is reported as having said that over the past year the Association had to request two rates increases, and a third came into effect at the beginning of this January. One Inverness haulier pointed out that during 1970 fuel costs rose by 2d. per gallon, the cost of new vehicles rose by up to £500, the price of each new tyre rose by up to £5, and drivers' wages have risen by as much as 27 per cent. since October, 1969.

Even though I believe that the hauliers in Scotland do a good job and offer per haps better ton-mileage rates than those in other parts of the country, the fact remains that the distant areas are the ones most affected by haulage, and it is there that the most attention should be given to allowing us the same opportunities to compete as everybody else.

I want to comment on Chapter V of the Report—Industrial Training and Retraining. I am surprised by the complacency of the Report as to the training boards. It does not reflect the feelings of my constituents. In Peterhead, thanks to the devoted work of some splendid people and the assistance of the Engineering Training Board, a satisfactory training centre has been established; and we are grateful for that.

Otherwise, from the Agricultural to the Hotel and Catering Industry Training Board, to the Construction Industry Training Board, to the Road Transport Industry Training Board, and the Wool Industry Training Board the moans have been heartfelt and serious. One has to pay for what one does not get and the boards are presented as a tax on production, providing—this is the feeling in the area—employment for non-productive young men in shining motor cars who come in and out.

The theoretical arguments about the value of training in industry, the need to avoid poaching, and so on, simply do not apply in my part of the country, because in many cases these firms cannot get the training and they pay their contributions for nothing. It is simply an extra tax for another bureaucracy. For instance, since the Construction Industry Training Board was established employers still have to pay for training of staff but they also have to pay a levy to the C.I.T.B. from which some of the training costs are provided. Without the C.I.T.B., the costs to the industry would be much lower without any lessening, in the view of my constituents, in either the quality or the quantity of the training provided.

One trouble may be that no percentage limit was originally placed on the administration of the boards, with the result that small empire builders have popped up all over the place to swell their domains and ask their captive industries to pay for them. We saw it in agriculture. It can be seen in the C.I.T.B. I have a letter here from a constituent saying exactly the same thing about the Road Transport Industry Training Board. The Government are expected to do something about it, and I hope that they will.

Industrial training seems to have been tackled the wrong way round, rather as the Report in this chapter looks at the problem from an overall standpoint—from on top of the whole thing—and accepts an expensive administrative remedy. I would much prefer it to have been tackled from the grass roots first, for a proper assessment of training needs and deficiencies to have been made by a few people industry by industry and place by place, and then for the chance to have been given for local firms, industries and businesses to make their own recommendations and proposals as to how to meet the problems of the industry as a whole and to contribute the finances needed. If it had been done that way, they would have regarded these boards as their own.

Mr. Douglas

The hon. Gentleman is denigrating a marvellous advance in industrial training, something which the Report substantiates. Individual firms cannot be left to do this job, but within the purview of the training boards individual firms have flexibility and can contribute.

Mr. Wolrige-Gordon

I am genuinely glad to hear that the hon. Gentleman takes a contrary view, based on his experience in his part of the country. Probably the same can be said for the central belt as a whole, I hope that it can be said. In my part of the country the feeling is very much in a contrary direction—that the advantages are not substantial in any way and that the costs are outrageously high.

If that approach had been taken and the training boards had started slowly rather than with an enormous bang, smaller firms in particular and industries and businesses as a whole could have come to regard the boards as their own, the training as their own, and the services that the boards provide as their own, whereas at present they do not, and the antipathy to the boards and the gap between the boards and the firms are great and disadvantageous to what we want to achieve.

7.28 p.m.

Mr. George Lawson (Motherwell)

The hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) has said much about the shortcomings of the Labour Government. I take it that he is aware that the Act which set up industrial training boards was a product of the former Tory Government: it was one of the good things done by that Government. For generations the training of youngsters had been left to work itself out as best it could, with no one having any general supervision over it. There was constant complaint about firms that did no training and that had no apprentices but which poached the trained staff of other firms.

Each industry pays for the skill it needs. This is a sound principle. It may be true that improvements need to be made in the present system of training boards and that waste is occurring.

It is strange that the hon. Gentleman should complain about lack of facilities in his area. He complains that there are differentials in earnings in his part of the country and he insists that a man there should get as much as a man in London or one in the central belt. He is a member of the Tory Party, whose great flag-waving effort is on the virtues of free enterprise, which produces this kind of thing. If he wants this equality in different parts of the country, it can be done only through more and continuous intervention in some form or other by some kind of public authority —by the State, in fact. He should get out of the habit of picking out those things which suit his argument and ignoring the other factors which do not.

Mr. Wolrige-Gordon

The right hon. Member for Kilmarnock (Mr. Ross) seems to be supporting the other point of view.

Mr. Ross

I was not. I was castigating the ignorance of the hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) who really was slurring an eminent individual in Scottish industry—an American, incidentally—who is doing a lot of work in his area. The hon. Gentleman does not even know the man he was talking about.

Mr. Lawson

My right hon. Friend the Member for Kilmarnock (Mr. Ross) has answered the hon. Member for Aberdeenshire, East sufficiently.

I am sorry that the hon. Member for Fife, East (Sir J. Gilmour) is not here—I appreciate that he was here for a long time—because I was interested in the points which he made. He was a member of the Select Committee. I was interested in his statement that the Committee had difficulty, and it is on this aspect that I want to dwell. Sub-Committee A was given the job of looking into financial incentives. We probed the matter as far as we could with the limited time and powers we had. We tried to come up with answers that were agreed. The Under-Secretary of State for Development was a member of the Sub-Committee. He will recall that the hon. Member for Galloway (Mr. Brewis) was the convener. I am sure that he would be the first to admit that, had we on this side of the House—and I include the hon. Member for Inverness (Mr. Russell Johnston) in this—been drafting the Report, it would have been much more forthright than it was on certain of the recommendations which we came up with. But we tried to reach a consensus, an agreed view.

The difficulty was that the experts we called in could not be precise. The witnesses included two university professors and top businessmen. Indeed, we had really top businessmen like Sir John Toothill and Sir Robert Maclean. We had experts from the then Ministry of Technology and the advice of the Treasury. We could not get from them precise answers to our questions. They could not tell us how effective the different forms of incentives were. They had ideas about them but they could not be precise, and I do not blame them for that.

My own approach—and I do not think the Under-Secretary of State will challenge me on this—was that our practice in this country was much ahead of our theory. The theory had not been worked out. It so happens that men do things and afterwards attempt to explain or justify what they have been doing. I thought that our British practice in terms of incentives for regional development was substantially ahead of our theory. We could find no theoretician who could tell us precisely what the facts were. The answer we got repeatedly from those answering on behalf of the Board of Trade or the Ministry of Technology was, "These are questions which are now being studied in depth." It seemed strange to us that so much money had been and was being spent without adequate study of the effects, but we all agreed that the general set-up seemed to be desirable and to be achieving results.

We did not say that these measures were transforming the whole set-up of our country overnight, but none of us, including the Under-Secretary of State, challenged the efficacy of these measures up to the point which was clear to us. At the end, having said that, we looked forward to or hoped to see the Ministry of Technology getting down to the business of studying these things in depth and telling us what their real value was. That was our overall conclusion. We welcomed the information that the matter was being studied much more thoroughly than ever before.

Without being derogatory to anyone else, I regard Sir Robert Maclean as perhaps the most important witness to give evidence to us. No one will challenge me when I say that surely he should know what he is talking about. No one else has had such extensive experience as he has had over such a long period. He used the illustration of the stool with three legs. It was not done in any offhand fashion. He thought that the mix of incentives—a term used frequently—was about right. He thought that we had to have a mix of incentives simple to explain and simple to understand by the people we were trying to attract into an area. He pointed out that we also had to have something to offer them that they would have confidence in and which would not be changed next month or next year.

The importance of simplicity was emphasised over and over again, together with the need for confidence that the system would not be changed in a short time. Sir Robert explained what the three legs of the stool were—the investment grant, the regional employment premium and the industrial development certificate policy. He told us, If you knock any one away, the whole may collapse. As my right hon. Friend said, the Government have knocked away all three. They have scrapped the investment grant. My particular complaint is that they have done it without knowledge of the facts.

I have asked before what happened to the prolonged and deep study that was being made. Were we to have access to it? Where was the information? Had the Government, in deciding to scrap the investment grant in favour of the income tax allowance, taken the Select Committee's Report into account? I defy the Under-Secretary of State to tell me honestly that the Government, when they took the decision to scrap the investment grant and replace it with the allowance, did so as a result of a systematic study of the efficacy of the one as compared with the other. He knows that, during our discussions on this question of investment grants and allowances, he repeatedly sought—I do not blame him —to question the witnesses in order to get from them some expression of preference for the tax allowance. The hon. Gentleman knows that he constantly tried to do that, but he never succeeded. He was very skilled and I compliment him on his ability to cross-examine, but from those whom we questioned he never got the answer he wanted.

Even before they became the Government, right hon. Gentlemen opposite were clearly saying that they would scrap the investment grant. That is a matter of political doctrine. It is fair enough for them to say that they will base themselves on political doctrine and that they are entitled to do so, but they should not tell us that they made this decision after prolonged and careful study. They made it as a matter of political doctrine and without any knowledge of its implications.

The hon. Member for Inverness might give some other reasons, for he constantly harped on the point that one great advantage of an income tax allowance over an investment grant was that by the former one could hide the amount of money being paid. The Government also told us that they were to be more discriminating and to ensure that we got better value for money. I defy the hon. Member for Ayr (Mr. Younger) to tell me how one could discriminate by the use of an income tax allowance. It is not a discriminating instrument. The firm which gets the income tax allowance is the firm making sufficient profit. That may be good or bad, but an excellent new firm might not make a profit and in such circumstances it would not get an allowance.

My hon. Friend the Member for Central Ayrshire (Mr. Lambie) might have made the point when he talked about Hunterston. I am more concerned about Hunterston than he is, for I represent the greatest steel-producing area in Scotland. My hon. Friend the Member for Rutherglen (Mr. Gregor Mackenzie) comes second to me in that concern and my hon. Friend the Member for Bothwell (Mr. James Hamilton) follows. I was interested in the ore terminal even before it was mentioned in the Press. If we fail to get the ore terminal, we may fail to keep the existing steel industry going.

Forgetting the steel complex which might some day come there, and there has not yet been a plan for the building of a steel complex on the site, although it has been discussed, how would the ore terminal be financed? Are doubts about how it is to be financed holding up the decision? The investment grant has been scrapped. Is the Clyde local authority to have to pay £15 million out of its resources, and that was only the first figure and the amount is now probably very much larger? Will there be any grants? Will there be assistance in the form of income tax allowances? What sort of income tax allowance could be expected? How long would the project take? What kind of inducement would be offered to the British Steel Corporation to take part in the scheme? I should like some information on these important matters.

I have talked for as long as, and perhaps longer than, some of my hon. Friends and Members opposite want to hear me, but I should like to mention the two other legs of the stool. The Government have scrapped the regional employment premium. I know that they will say that they have not scrapped it and have said only that it is to be terminated on a given date, that being the date which we fixed. But we did not say that it was to end on that date: we guaranteed it until the date, and that is very different.

The result is that each firm knows that the premium will finish on that date, and it will shape its policy accordingly. Those thinking of coming into the area will put that fact into the scales against coming in, and companies thinking of pulling out will put it into the scales in favour of pulling out. There is an important distinction between saying that the premium will finish on a given date and guaranteeing it until that date when there is a great chance of its going on beyond that.

Mr. Younger indicated dissent.

Mr. Lawson

The hon. Gentleman shakes his head, but I am sure that all my hon. Friends and the hon. Member for Inverness would have been with me in voting for its continuation, because we have had plenty of evidence of the value of this leg of the stool.

The third leg was the I.D.C. policy. Not a voice has been heard against the policy of controlling industrial development in the crowded areas of the Midlands, the South and South-East. One of the most powerful voices in Scotland, that of Sir John Toothill, said that for him this was the most important of all the elements of a regional employment policy. It was his view that the existing policy should be tightened up. It has not been working well enough, and we have had evidence of that, because it has not been applied as we should like.

The hon. Gentleman may say that the Government have not adopted the recommendations of the Hunt Committee, but they have taken a long step towards doing so. The limit in the crowded South has been raised to 5,000 sq. ft. When we were last in Opposition and the present Prime Minister was President of the Board of Trade, we frequently discussed the industrial development going on in areas other than Scotland. The answers which we then received I have subsequently found to be misleading, although I do not have time to discuss that tonight. I am sure that the hon. Member for Ayr knows something about this, because the Report mentions how misleading were the answers which we were then given.

At a time when the limit was 5,000 sq. ft., there were advertisements on the Underground and elsewhere about new factories in places like Slough. The reason that such advertisements could appear was that nests of factories, each just under 5,000 sq. ft., say, 4,999.9 sq. ft., were being built and then linked into industrial estates. That was what was happening under the right hon. Gentleman when this policy-was supposed to apply.

The hon. Gentleman is committed, as I am committed, to what is in the Report. It has been watered down specifically to meet his point of view, and I would have gone much further than he. But he is a member of the Government who have scrapped these Measures after having said that they had studied what they were doing. "Lie" is not a parliamentary word and nor is "falsehood", but this is deliberate deception of the House and of the country, and my hon. Friends and I will not tolerate it for a moment longer than necessary.

7.50 p.m.

Mr. Hamish Gray (Ross and Cromarty)

The hon. Member for Motherwell (Mr. Lawson) has made an interesting speech to which we have all listened with pleasure although we do not agree with all of it.

The purpose of the debate must be to focus attention on the economic needs of Scotland. I acknowledge that the Select Committee which undertook the investigations into this vast subject is to be congratulated on the comprehensive nature of the work. It must have spent many hours in reaching its conclusions, and we owe it a debt of gratitude. Unfortunately, it is reasonably clear that the detailed statistical information which might have been of use to it, on a United Kingdom basis, was not available in an identifiable form for Scottish purposes. While this is regrettable, I do not think that there is any doubt that in 542 pages of evidence and a further 115 pages of report there is sufficient material to arouse the enthusiasm of any Scot.

While the Report does not necessarily provide all the answers, we must accept that it pinpoints the strength and weaknesses of the present structure and provides useful guide lines for future legislation. The announcement about the future of local government which we believe will be forthcoming soon will probably highlight some of the findings of this Committee, particularly in respect of regional planning and development and economic planning. In this respect, I agree entirely with the Committee when it said in Chapter 1, paragraph 130: It is clear to us that the machinery for economic planning in Scotland outside the Government service is purely consultative, apart from the limited rôle of the Highlands and Islands Development Board. The consultative machinery in Scotland functions reasonably well but there are few things quite so frustrating for any policy-making advisory group than to frequently recommend and advise without ever having the executive power to see those recommendatons or that advice being implemented. These decisions are still made to a large degree by the Government Department concerned. It seems to many of us at times that the consultative machinery is either forgotten or ignored despite the fact that the right hon. Member for Kilmarnock (Mr. Ross), the former Secretary of State, stated in his evidence to the Committee that he considered that the advice provided by these bodies was of inestimable value. I would suggest that the right hon. Gentleman was being extremely loyal to his civil servants and to the people who provided the advice. I do not think that the advice is very often taken as seriously in the Department as it could be.

When it comes to local planning it is regrettable that the local planning authorities are not kept fully informed about the overall planning policy for Scotland and, indeed, for the United Kingdom. The Scottish Economic Planning Council, of which the Secretary of State is Chairman I believe, could keep the local authorities more informed than it does. It would be an aid to the Council if in addition to the local authority representatives who sit as individuals there were officials from local authorities. I would like to suggest that the Highlands and Islands Development Board comes nearest to being able to see the results of its deliberations but even it can sometimes be thwarted despite the fact that it has executive and financial powers.

It is interesting to note that the Committee felt it was easier for the Scottish Office, for example, to transfer expenditure from one programme or one project to another than it may be in certain other Government Departments. At times it would appear that there are considerable sums involved. This speaks well of the flexibility within the Scottish Office, and I have no doubt that this is something that is envied by other Departments.

The Report deals at length with the question of infrastructure, particularly within development areas, and no one would deny that it is well-nigh impossible to entice industry to areas which do not offer adequate facilities for housing, schools and other basic services but perhaps most important, adequate transport systems for all modes of traffic at all times of the year. I feel particularly strongly about the transport question because in my constituency we are faced with the possibility, and I sincerely hope that it is no more than that, of a rail closure. I hope that the Secretary of State will consider very carefully the serious implications of a closure in this area at this time.

Present Government thinking must be welcomed. In the eyes of Scotland, the promised new fast road from Inverness to the North is a basic essential and should have been initiated many years ago. The objective must be a continuation of the present dual carriageway north of Edinburgh, not only to Perth, not only to Blair Atholl but right over the Grampians to Inverness, where one would hope it would link with the proposed fast road, which must not stop at Evanton but must proceed right to the North and continue to Wick and Thurso. This kind of infrastructure-thinking is what must be encouraged. Provide these essential communications in the Highlands and further incentives to attract industry will be unnecessary.

Mr. Maclennan

The hon. Gentleman will have heard the Secretary of State speaking about the very road he is describing, and he will have noted with disappointment that the Secretary of State is still talking in terms of plans but not in terms of roadbuilding.

Mr. Gray

The hon. Member knows that it is necessary to plan before one can build. When plans are laid for a road it is a number of years before the road ever appears. These things do not happen overnight. Meantime it is imperative that encouragement is given in the short term to potential industrial developers in Scotland, particularly in the Highlands.

English Members may often wonder—when they come in and listen to our debates—why it is that every Scottish Member who gets up seems to be plugging his own part of the country. The reason is obvious. We have to do it because the tendency is for expansion to take place in the southern central belt of England and we have to use every means we can to attract industry to Scotland. Tax allowances are certainly an attraction for the established concern but they offer little to the new company just starting up. The Local Employment Acts can help where the provision of jobs is important but in the Highlands some additional inducement, not readily available elsewhere in Scotland, is absolutely essential.

This has been a problem in the remote areas for a long time, and, while I warmly welcome the infrastructure proposals, I consider that the greatest help which the Government could offer now would be the creation of a Highlands of Scotland special development area similar to that which has been described. It was not sufficient to say that the Highlands and Islands Development Board has special powers. The Board would need a very much greater amount of money available to it before the special powers incorporated in its charter could really be effective.

There are plenty of hon. Members prepared to speak for the west central belt of Scotland, so I do not propose to spend time on the problems there, but if we are not careful we shall create a situation in west central Scotland similar to that which exists in the South of England. Every possible method must be used to try to influence people to move from that area to the widest area of land available in Scotland, which we hope will soon have the necessary communications.

The Highlands and Islands Development Board has weathered the ailments of infancy and it must now be encouraged to develop into manhood as the driving force of Highlands opportunity. The Board must pay no attention to the Jonahs and those who for reasons known only to themselves persist in their strange beliefs about the area and its needs. Of course, industrial development in the Highlands is not only necessary but desirable. There is no reason why it cannot be integrated without affecting the tourist industry and without interfering with the natural beauty of the area. Space is not one of our problems in the Highlands.

We in Scotland are faced with a critical unemployment problem which is not of our making but the result of a complete failure by the last Government to come to grips with the problem. It is the result of years of ostrich-like tactics over the problem of unemployment. The Labour Government's forecasts, like their performances, left much to be desired. They estimated in "The Scottish Economy, 1965–70" that there would be a net increase of 10,000 jobs per year in all industries and services between 1965 and 1970—that is, 50,000 jobs in the period. That is confirmed in the Select Committee's Report's reference to the White Paper Cmnd. 2864 which forecast a net increase in jobs available over the period of between 50,000 and 60,000. Yet in March, 1970, when the then Secretary of State made the statement which I have quoted, there were 11,000 fewer jobs in Scotland than in March, 1969, and no less than 33,000 fewer jobs than three years earlier.

Hon. Members opposite may shake their heads, but they are too late. They should have been thinking about the problem six years ago. The frequent warnings of my right hon. and hon. Friends were completely ignored.

Mr. Maclennan

Does the hon. Gentleman agree that if the advice of his hon. Friend who is now Parliamentary Private Secretary to the Secretary of State had been followed the developments at Invergordon would never have come about?

Mr. Gray

I am not dealing with that point. I would not accept what the hon. Gentleman said for one moment. But it is interesting to note——

Mr. Douglas

Would the hon. Gentleman give way?

Mr. Gray

No. I have just given way.

It is interesting to note that, despite investment grants, there was nothing of any magnitude in the pipeline for my area at the time of the change in Government.

Mr. Ross

What about Grampian Chemicals?

Mr. Gray

I do not want to mention any company by name, but were the right hon. Member for Kilmarnock and his party interested in providing grants for that concern at that time? I doubt it. The monetary incentives through the Local Employment Acts for the creation of new jobs must be made attractive and many more concessions should be offered to companies prepared to move to development areas. My hon. Friend the Member for Galloway (Mr. Brewis) mentioned the case for a congestion tax in already overpopulated areas. That is sound thinking, and I hope that the Government will consider it.

Mr. Ross

The hon. Gentleman will remember that until we had the Highlands and Islands Development Act the Highlands were controlled by the congested areas Act.

Mr. Gray

I am grateful to the right hon. Gentleman for his helpful intervention. I shall be glad to hear it explained in detail by him at some future time. I am not dealing with that point.

The whole concept of growth areas was outlined in the Toothill Report in 1961. The recomendations of that Report were accepted by the Government at that time who in 1963 produced a White Paper on Central Scotland and followed it with special financial provisions in the Budget of that year. This in turn led to industrial expansion which took place not only in Scotland but in the North of England.

The Report, in referring to the Scottish Office, rightly states in paragraph 73, Chapter 4—and this point is vitally important— No other Department can have the same intimate knowledge of Scotland's circumstances and needs. The success of the Government's policy for encouraging industry in Scotland must depend very largely on co-ordination and collaboration between the Ministry of Technology and the Scottish Office. That reference should now read "the Ministry of Trade and Industry and the Scottish Office". It is an omission that there does not appear to be a senior official of the Department of Trade and Industry located at St. Andrew's House. I may be wrong and no doubt my right hon. Friend the Secretary of State will correct me if I am. What is needed is an official with sufficient authority to take major decisions quickly so that matters can be co-ordinated. The two Departments must work in unison to provide immediate help to the Scottish economy.

The Government are tackling the legacy of a Socialistic shambles in a business-like and purposeful way. [Interruption.] The hon. Member for Fife, West (Mr. William Hamilton) is always amusing with his interjections, but he is often amusing when he does not mean to be, so that balances matters out.

Desperate measures must be taken, and I am sure that the Government will take them quickly.

I have tried to be constructive, despite the abuse of hon. Members opposite which one gets used to. I should like to make one or two more suggestions. I invite the Government to give the most serious consideration possible to transferring the headquarters of the Forestry Commission to the Highlands. There is a much stronger case for locating the headquarters in the Highlands than in the South of England. The noble Lord, Lord Hughes, speaking recently in another place and referring to the electronics industry, suggested that this type of development was highly suitable to the area of the Highlands and Islands Development Board. He said: So the Board are well advised to consider the importance of such an industry which does not necessarily have to start in a large way. One of the largest American concerns in this field, now employing more than 30,000 people, started less than a quarter of a century ago in the garage of its founder …".—[OFFICIAL REPORT. House of Lords, 27th January, 1971; Vol. 314, c. 962.] I agree entirely with the noble Lord. Only last year the North of Scotland Hydro-Electric Board had a wonderful opportunity to locate in my constituency a computer which would have been extremely valuable from the point of view of the jobs which it would have provided. It saw fit to go to Aberdeen, and the hon. Member for Aberdeen, North (Mr. Robert Hughes) is, no doubt, pleased about that. But this was the type of work which was very suitable indeed, because the only essential service required for it would have been the postal service, which exists in our area—or will soon again exist, one hopes. The Board decided against this, and I consider that this was a most regrettable decision. The Report and deliberations of the Select Committee are helpful and constructive, but they must now be translated into action. In the meantime we will note the contents.

8.10 p.m.

Mr. Russell Johnston (Inverness)

It is inevitable, the unemployment position being as it is in Scotland, that many Members have turned their attention to this very pressing and real problem and have, therefore, turned from the details of the Report which we are seeking to discuss.

Before turning to those wider questions I should like, very briefly, to look at the Select Committee itself and ask how effective it has been as an instrument in examining Scottish government and, in particular in this case, examining the state of the Scottish economy and what ought to be done about it.

The House will know that the Liberals favour an elected Parliament in Scotland within a United Kingdom federal system, and hold strongly to the view that a genuine and significant improvement in Scotland's situation is unlikely unless there is created in Scotland a responsible decision-making body which can determine its own priorities. Nevertheless, I think there are improvements which can be made within the existing framework.

I think that probably the Select Committee had reasonable success in achieving what it set out to do, and in this it was greatly assisted by the character and personality of Mr. Tom Steele, the tribute to whom by the right hon. Gentleman I am very happy to go along with. Indeed, one also pays tribute to two hon. Members present here, the hon. Member for Galloway (Mr. Brewis) and the hon. Member for Paisley (Mr. John Robertson), for the very considerable amount of work which they did. The question arises, however, to me at least, having my first experience of a Select Committee, whether the objectives of an all-party Committee such as this were not rather too wide and whether an all-party Committee of this kind, meeting over a short space of a year, can operate adequately over a wide area, and perhaps ought not better to concentrate its attention on certain specific things. The problem of an all-party Committee is a very real one, which has been touched on already by many hon. Members, the difficulty of producing some consensus which is yet of significance and importance. That difficulty is a real one. The object of the Committee ought not to be to produce any learned political economic treatise but to isolate and point out important political questions which on certain specific issues ought to be answered. I am thinking, for example, of things like the delay on Turnhouse Airport and the future of the Highlands and Islands Development Board, or what we think about Oceanspan. There are many individual things which the Select Committee might very usefully have examined more closely.

The fact is that the actual impact which our Committee made on Scotland was pretty negligible. The Scottish Press was certainly not hanging avidly upon our words. This is true.[Interruption.] I think that matters a good deal, because the communications media is the only way we have as politicians to get over our ideas to the public. I think it was a mistake, for example, that the proceedings, the public hearings, were not televised, as my hon. Friend the Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) suggested. If we could televise the Royal Commission on the Constitution why not the Select Committee on Scottish Affairs?

Then there is also the real problem of hon. Members' time. I must confess I found myself missing some meetings of the Select Committee. Again, attendance at Committee meetings is not necessarily even accurately reflected by the sederunt. It does not say how long one is there! One of the reasons for this is that one makes a decision of priorities in the allocation of one's time, and moreover, much of the time the discussions were of a very general nature and consequently the urgency aspect, if I may call it that, which is so essential in politics, was, to some extent, absent. If the Committee had been dealing with specific matters—matters on which one wanted an explanation, for instance—there would have been more zip, as it were, in the Committee.

In the end, there is no doubt, we produced a useful instruction manual on government machinery in Scotland—a lucid description, as the Secretary of State put it—and he should know; reference material, as it was called by the hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon).

Perhaps the most useful thing in it was our implicit recognition—I think it must be admitted by the Secretary of State that there is an implicit recognition —of the value of investment grants, and, indeed, further recognition that these grants were not yet at a high enough level. If one looks at the Report, on page 92, paragraph VII.4. We see it is clearly spelt out: Obviously the incentives would have to be pitched very high indeed if they are to have any chance of inducing the movement of any industry which is established elsewhere but not expanding significantly. We have no reason to think that the present level of incentives is high enough to have any such effect, and therefore the amount of new industry which comes to Development Areas is certain to be a limited one at any period during which indusrial growth in the United Kingdom as a whole is limited. We stress the importance of the costs of congestion. I shall not go again over the ground which has already been covered very well by the hon. Member for Galloway, but the fact that there is no real study of congestion is a very valid point which we made and which ought to be stressed very strongly, and the value of I.D.C.s. Our Report and the major witnesses we heard stress the value of I.D.C.s, and that makes all the more extraordinary the Government's decision to relax their provision. Indeed, it is the Government's intended change of policy in this regard which has called forth the Opposition's Amendment today, and for our part we on the Liberal bench, if that Amendment leads to a vote, will support the Opposition.

I do not intend to labour the whole question of investment grants versus investment allowances because it has already been thoroughly aired, notably by the hon. Member for Motherwell (Mr. Lawson), with a lot of whose remarks I agree, but it seems to me that there is in industry widespread agreement that the last thing the Scottish economy wants at the present moment is a reduction in the availability of liquid capital. I think the Government's intention is certainly having an adverse effect on industry.

I want now to touch on four specific things—briefly, because I know a number of hon. Members still wish to catch your eye, Mr. Deputy Speaker. I consider them all to be of basic importance to the Scottish economy. Firstly there is the future of the Highlands and Islands Development Board. I know that the Government have emphasised, and, indeed, re-emphasised, that they intend the Board to be the major vehicle for development in the Highlands. I know also that they have denied that there is any question of diminution of the Board's rôle. Nevertheless, I remain worried. It is, of course, true that the Board has done good work, but there is a very important question of scale involved. I have been looking at Sir Robert Grieve's foreword to the Board's first Report, and I want to quote a little from it. We must all pay tribute to the tremendous work he did when he was chairman. He said: It is therefore easy to flatter ourselves that an experiment in regional development such as the Board is carrying out is of world interest. However, such a statement is absolutely and strictly true. It is essential that we should realise this, all of us in Britain, and recognise that the Board is setting out to do a job now recognised as one of the important preoccupations of government in western civilisation. Later he says: It is therefore, as I say, no exaggeration to claim that the efforts of this Board will have world significance. He finishes by saying: That is the measure of our activity; that is the challenge which the Board has knowingly accepted. If indeed this is the challenge, if it is of this scope and scale and importance, then I have grave misgivings about the capacity of the Board in terms of its expertise to meet the challenge. The Board was set up because it was agreed that the Highlands required distinctive and differential treatment, but the differential now is much more imaginary than real.

When the Select Committee was interviewing Professors Wilson and Brown, I asked Professor Brown, at page 293: In answering the Chairman, Professor Brown, you said that there were large areas of Scotland in which the incentives would have to be considerably higher than the present incentives if they were to have a chance of getting much new industry. That is roughly what you said. Does that mean in effect that, for example, the Highlands and Islands Development Board does not have a chance of getting much new industry under the present regime? Professor Brown replied: As a snap judgment with strong reservations in view of my ignorance, I should say that that seems a reasonable proposition, likely on the whole to be true … On page 322, I asked Mr. Whitehouse, the head of the Distribution of Industry Division of the Ministry of Technology: When we saw Professor Brown, as I recollect, he said that the difference which the Chairman has referred to was not really sufficient to make any significant difference to the decision of an industrialist as to whether he was going to come or not; that in fact much of its success might well be related to its promotional activity. I am referring to the Board: Does the fact that we have not really allowed any significant distinction of this sort mean that … the economic factor is much more the decisive one rather than any social factor? … It is seen as being a very expensive economic exercise and, although the Government goes through the motions of setting up a Board and making, if you like, noises, when you examine the actual argument the actual distinction is very little and the actual incentive is not very much greater than available elsewhere. Would you say that is fair or not? His answer was: Yes, I think it probably is. The Under-Secretary of State for Development, in pressing the point, said to him: Professor Grieve did specifically state to us in his evidence that he certainly felt the need for an extra incentive to persuade people not merely to come to Scotland but to come to his part of the Highlands. Do you not think that that is quite a natural request? Mr. Whitehouse said: I agree it is a perfectly natural request. It is a fully understandable request. It seems to me that the edge that the Board had is insufficient, as we recommend in the Report. The net result has been that the Board has had to concentrate on promotional activity. This it has done rather well, but it is indubitably a limiting factor. We can no longer ignore the fact that people are beginning to ask the question: would the unemployment and depopulation position be markedly different if there had been no board at all? This concerns me. This is not criticising the concept of the Board but criticising the way it has been applied and the freedom which has been given to it by the Government to vary national policy according to the area's need.

I want to turn to an area off Aberdeen. Like many other hon. Members, I am concerned that in a situation where our natural physical assets like coal are declining we should take full advantage of any new assets that may appear. There is the question of North Sea oil or gas. How is Scotland to benefit from this, because she could benefit enormously? On the other hand, she could get little out of it. If B.P. decided that the sensible and profitable thing to do was to ship the oil to Rotterdam, what is to prevent this?

Mr. Eadie

Or America.

Mr. Russell Johnston

Or America, although that is rather distant. Are B.P. and the Scottish Office in consultation about this? It is ironical, when one sees the oil-producing companies of the Middle East and South America getting together to try to obtain a larger share of the profits of their own assets that it could well be, despite Grangemouth and the talked of petro-chemical complex at Invergordon, that Scotland's contribution from this exciting asset would be employment from a few oil rigs.

Mr. Eadie

The hon. Gentleman laughed when I said "America", but he is aware of the reports we have had that this oil is of the non-polluting type. Since in America there are strict laws about pollution, it may be that, because the oil has this special quality, it might be shipped to America with a consequent loss of Scotland.

Mr. Russell Johnston

This may well be. The hon. Member for Central Ayrshire (Mr. Lambie) has already touched on the development of the Clyde. The Clyde Port Authority has taken a wholly admirable lead in this matter, but its reserves are limited and it cannot mount the major investment which the ideas in Oceanspan demand.

The present Government seem to be pledged to follow a philosophy of minimal involvement in economic matters. If the Clyde is to be developed and Hunterston is to be a major entry point, many questions must be answered and much expenditure undertaken. In the end the only body capable of facing these matters are the Government. It is only the Government who can decide whether a land bridge is on or is not. Only the Government can examine markets and the kinds of products to go for. With the spectre of the Mersey in the background the Government must surely take proper account of information at its disposal, as was shown by the Touche Ross Report. That report, commissioned by the National Ports Council, established clearly that no major port in Western Europe functions without substantial Government involvement, and involvement on a scale well above what we have been used to.

Fourthly and lastly, I want to make three short points. The first is that there is not enough consideration in terms of people. Our graduates are a great asset, an asset which we have failed to utilise properly, as is shown by the heavy wastage. In the Select Committee we gained a clear realisation of the difficulty of selective encouragement in terms of particular kinds of industry, and the situation in relation to some skills is virtually impossible. But surely some kind of differential treatment might be devised for companies with research and development facilities in Scotland. This could well have the double merit of retaining and encouraging more graduates and in getting under way more primary industry rather than secondary industry.

Related to this matter is the question of housing, and the report draws attention to the adverse effect on industrial development. This is especially true in terms of the provision of private housing, and in this respect the construction industry in Scotland is open to criticism as was shown by the recent Report of the Scottish Council. I am sure the Secretary of State will agree that lack of provision for private housing has been an important factor in frightening away some incoming industry. I hope that the Government will give careful consideration to, for example, the idea of giving cash grants to people who wish to buy houses, to help them to obtain mortgages. This is a practical way of providing help to people and this is something which has been advocated by the Liberal Party and for which the Scottish Council is pressing.

I will not dwell too long on the problems of transport in Scotland since time is getting a little short and many hon. Members still wish to speak. The fact remains that freight charges are a major distincentive to development, and we have still to devise some way in which to solve the problem in this respect on the peripheries of Scotland. We already face the closing down of rural services in, for example, Galloway and elsewhere. The hon. Member for Ross and Cromarty (Mr. Gray) drew attention to the situation in the Kyle of Lochalsh in regard to rail closures. Expenditure is often effective in bringing development into places where the infrastructure has withered.

Looking at the matter against the background of Britain's negotiations with Europe, the position in Scotland at present seems to be critical. If our problems are to be solved, more urgent and radical measures will be necessary than have so far been taken.

8.32 p.m.

Earl of Dalkeith (Edinburgh, North)

I promise the House that tonight I shall not weary hon. Members with the subject of sheep breeding. That would appear to be the only matter that is not covered by this excellent and wide-ranging Report.

I must beg to differ from those who have suggested that it is an insult that this Report has not been debated earlier. In my view, it is a Report which will have enduring qualities. It is a report to be read, studied and to be acted upon rather than a report simply to be debated. I am sure that Scotland owes a great debt of gratitude to hon. Members who took part in the proceedings of the Committee at a considerable sacrifice to their own time.

I welcome the fact that the speech of the hon. Member for Inverness (Mr. Russell Johnston) was completely free of abuse, slanting and damnation which we so frequently hear on occasions when the Scottish economy is mentioned. He made a constructive speech. I was particularly interested in his points about North Sea gas and oil.

We all want to see industrial expansion, but I am sure that we all want industries with a real prospect of being successful. We want to avoid the tragedies of those industries which start off with a flourish and then later flop. In this context it is possible to put forward the argument that allowances are a better means of helping industry than are investment grants. This ties in with the remarks of the hon. Member for Motherwell (Mr. Lawson) about cost-effectiveness. We must become more cost-effectiveness conscious than we have been in the past. At the same time, a good case can be advanced for saying that capital investment grants could be justified in very special circumstances. A project such as the Rootes plant at Linwood, involving such a scale of operations, might justify the use of the investment grant, as a special and exceptional circumstance.

The right hon. Member for Kilmarnock (Mr. Ross), in a brief flash of somewhat uncharacteristic generosity, made favourable comments about Rootes coming to Linwood. But this ties up with what I have said about the danger of having industries which flop later. As we all know, Rootes has been going through a fairly perplexing time. The comment column of the Daily Mail summed it up well a few days ago when it said: Chrysler workers in Scotland must be delighted with the £5 rise they have won. Will they be so happy if Chrysler continue to lose money and have to shut down? All of us in Scotland must realise—the sooner the better—that our future prosperity is very much in our own hands and not wholly in those of some fairy godmother. The performance of the previous Secretary of State went a long way to convincing the population that he made very little pretence to be a fairy godmother.

Edinburgh's exclusion from development area status is a subject close to my heart and my constituency. The Report referred to Leith's promotion to intermediate development area status. I have always been convinced that the best way to achieve a booming economy is to build success on to success; in other words, to have a series of growth points which radiate success outwards from the centre. Edinburgh used to be a really prosperous growth point. What is more, it was not an artificially created growth point but a natural and naturally successful one, which is very much healthier. Yet, alas and alack, the previous Government, for reasons which they have never divulged, went out of their way to clobber Edinburgh in a way which did very little good to the surrounding area and caused immense damage to Scotland's capital.

I emphasise the damage which has been done by drawing attention to the unemployment figures for Edinburgh. In January, 1965, unemployment was 1.8 per cent. That was below the national average. In January, 1971, it has risen to 4.3 per cent. For many years Edinburgh had the proud record of having about the lowest unemployment percentage of any place in Scotland. But today Aberdeen is beating Edinburgh with a rate of 3.6 per cent.

I should like to translate these rather cold percentages into figures which are more revealing in terms of human disappointment. In December, 1964, there were 3,564 people unemployed in Edinburgh. In December, 1970, the figure had risen to 7,190, which is more than double. This is a tragic situation.

Let us examine the so-called promotion of Leith to the status of an intermediate area to see what good that has done Leith. When comparing the figures for unemployment in Leith over the last year with those for Edinburgh, one finds that unemployment has risen by 40 per cent. in Leith and by only 33 per cent. in Edinburgh. This shows that Leith, in spite of the more advantageous situation in which it finds itself, has done less well than Edinburgh. It appears, therefore, that this was not a genuine remedy.

Leith ought to be a very high priority growth point. It is only logical to follow up the massive expenditure of taxpayers' money that was sanctioned by the previous Conservative Government to improve the docks by attracting and encouraging ancillary industries to settle round those docks. To have missed the opportunity that we have had in the last three or four years is most unfortunate not only for the people of Leith but for the economy of our country.

Mr. Michael Clark Hutchison (Edinburgh, South)

Does my hon. Friend agree that since Edinburgh was excluded from development area status and persecuted by the previous Government, no fewer than 42 companies have closed down and left the city?

Earl of Dalkeith

I am all too conscious of that horrifying fact, and it should be made widely known that this is so.

What I would dearly love to know is why Edinburgh was singled out for discriminatory treatment. We have never been told the answer. One has heard rumours that it was a sop to Wales, that certain parts of Wales were prospering and could not be included in development area status and that the Welsh would be very disappointed if some part of Scotland was not excluded; so, looking round, the Government of the day decided that Edinburgh was the most prosperous place in Scotland and would have to be excluded. If that was the reason, it was a very bad one.

Another possibility is that it was argued that Edinburgh did not need it because its unemployment percentage was too low to justify it. If Edinburgh did not need to be included in development area status because its unemployment percentage was low before, certainly it does today. It is now 4.3 compared with Aberdeen's 3.6, and, after all, Aberdeen is in a development area. In Edinburgh, unemployment is some 20 per cent. higher than it is in Aberdeen.

I come now to the subject of infrastructure. Housing was dealt with at some length in the Report, and, as hon. Members know, this has always been one of my deepest and most passionately felt interests. Looking at the picture today, there is a mixture of happy and unhappy news. The details that we heard earlier at Question Time about the improvement of Scotland's older housing is very good news. I hope that more advantage still will be taken of the grants which are available.

I would never dream of being so churlish as not to give credit where it is due, and perhaps I might give the former Minister of State, the hon. Member for Greenock (Dr. Dickson Mabon), a small pat on the back. I warmly congratulate him on what he did to increase improvement grants. What is more, I would not be so churlish as to deny him a word of congratulation on having produced a record number of houses in Scotland. One should recognise a record when it is a record. I am only sad that the figure did not reach the 50,000 that he hoped to achieve and that we would have hoped to achieve had we been in government then.

I am more than a little unhappy about the number of houses which have been approved and are receiving approval. I urge my right hon. Friend to concentrate the resources of his office on boosting the building of houses. This is vitally important if we are to get the infrastructure of our country right. It has a most important effect upon how people think and act.

I end with what I hope is a constructive suggestion which will percolate into the ears of the Treasury.

I believe that there is a strong case for somehow devising at Treasury level some means whereby we can encourage Scotland's expansion at a time when it is necessary for the United Kingdom to suffer from a credit squeeze. We have had a credit squeeze for many years. Yet nobody has devised a way whereby Scotland can be exempted from the effects of such a squeeze.

At different times I have suggested that there should be a difference in the rate of income and corporation tax for Scotland. At one point I received some interesting figures. On income tax alone, in an answer from the previous Government to a Parliamentary Question, I discovered, that if the rate of income tax was reduced in Scotland by 2s. in the pound, was kept at its present level in Wales, and was increased in England by 3d. in the pound, the Treasury would be £33 million better off. Obviously one cannot go round suggesting that income tax should be increased by 3d. in the pound in England.

Hon. Members

Why not?

Earl of Dalkeith

For the simple reason that we would soon see an enormous campaign mounted demanding Home Rule for England. I am not sure that hon. Gentlemen opposite would welcome that any more than I should. However, I suggest that when the Chancellor of the Exchequer next has an opportunity of reducing income tax throughout the United Kingdom, he might say to himself, "If I keep it as it is in England for the time being, I can knock a great chunk off in Scotland." As I have pointed out, it would not be so expensive to the Treasury.

Such a proposal would be important because it would be backing people. It would encourage people to stay in Scotland, the people we need to make Scotland a dynamic place again. Far too many of our good people have drifted away, and we must win them back. Backing people in this way can do more good in restoring the health of the Scottish economy than backing possible dubious industries.

Therefore, although I welcome the Report—it will pay us to study it for many years—I think that points like those which I have put forward deserve consideration as well.

8.48 p.m.

Mr. Donald Stewart (Western Isles)

The economic situation in Scotland has changed considerably since publication of the Report of the Select Committee—it has changed drastically for the worse. For that reason a number of hon. Members have concentrated, as the hon. Member for Inverness (Mr. Russell Johnston) suggested, on the unemployment situation and the state of the Scottish economy generally.

The Opposition blame the situation on what the Government are or are not doing for the Scottish economy, and the Government blame the previous Government for what they did or did not do. I have not the time to put both these charges to the test. I will save the time of the House by pronouncing a verdict of guilty in both cases.

Unfortunately, although the Western Isles and the Highlands are often in advance of the rest of the country, there are times when we regret this, particularly when we are in advance on the unemployment figures. Last month, in the Western Isles, 26 per cent. of the insured population was out of work. In the Highlands generally the figure is 10 per cent. This is a portent of what might be coming to the rest of Scotland.

The situation is approaching a catastrophic level with unemployment up to 115,000. The complacency of the Government and the Scottish Office in this situation is beginning to make fiddling while Rome burned look like a rational way of passing the time. The Secretary of State must get down to urgent action, because it is needed in the present situation.

I hope that I am not distorting the words of the hon. Member for Central Ayrshire (Mr. Lambie), but I believe that he said that, while an affluent Britain does not necessarily mean an affluent Scotland, a depressed Britain means a depressed Scotland, sometimes in much greater degree. That is the situation. We are relatively worse off, because there are 20 people chasing every vacancy for males in Scotland while in England the figure is six. Therefore, we are four times worse off for employment.

The work of the Highlands and Islands Development Board has been hamstrung to a great extent by the selective employment tax. The Secretary of State was very vociferous before the General Election in demanding the abolition of S.E.T. and promising that it would go with the return of a Conservative Government. We are still waiting. The abolition of the tax would be of tremendous assistance to the Board.

I have some proposals to make about a Treasury for Scotland, even with the present set-up, which would allow the planning of fiscal and budgetary policies applicable to Scotland. At present, policies that might be quite rational for the rest of the United Kingdom are extremely damaging to the Scottish economy. I note with some gratification that the Conservative Party's Constitutional Committee admits the principle of applying different fiscal policies in Scotland.

I urge the Government to work towards the establishment of the Scottish Assembly. No one is more aware than I am of the inadequacy of such an Assembly for Scottish government, but it is a step in the right direction and should be implemented as quickly as possible so that the members of all parties in Scotland can get down to the urgent task of rebuilding the Scottish economy.

8.53 p.m.

Mr. Robert Maclennan (Caithness and Sutherland)

In the short time left to me I am glad to follow the hon. Member for the Western Isles (Mr. Donald Stewart). No part of Scotland suffers more acutely from unemployment and failures of economic planning than the constituency which he represents.

It is noteworthy that in his introductory speech the Secretary of State breathed not a word of the Government's policy towards the Highlands, although there has been no statement by him in the House of Government policy towards the Highlands since he was elected to office over seven months ago. The Select Committee's Report pays a great deal of attention to the unique problems of the Highlands area and makes some recommendations. It was characteristic of the right hon. Gentleman to pay no attention to those recommendations today but rather to indulge in fighting yet again a General Election campaign which in Scotland he lost last June.

The misfortune of the matter is that the Committee sat for two years, studied the problems very carefully and made extremely careful judgments, and this afternoon we had no verdicts from the Government on those judgments and no expectations that they will consider the recommendations.

The right hon. Gentleman made some remarkable announcements this afternoon which demonstrated the absolute poverty of the Government's thinking about regional policy. If he is so convinced that the switch from development grants to tax allowances is the cure-all for Scotland, why has he found it necessary to declare the West of Scotland a special development area? Is this not proof positive of the bankruptcy of his approach?

What is even more remarkable is that the right hon. Gentleman should be unable to inform the House when these measures will be effective. This is a positive disincentive to investment in Scotland. While he and his colleagues dither around trying to decide whether or not they need legislation before they can offer industry extra help——

Mr. Gordon Campbellrose——

Mr. Maclennan

No; I have only five minutes. The Under-Secretary can deal with the point in due time.

While the right hon. Gentleman and his colleagues dither around trying to make up their minds whether legislation is necessary to enable this extra help to be offered what industry will invest in the west of Scotland when the prospect of greater Government help to the area is at some unspecified time ahead?

When we have record unemployment, when firm after firm is in difficulties and what is needed is capital investment, the right hon. Gentleman comes to the House and creates further uncertainty. This is utterly deplorable and in character with the fact that on 27th October——

Mr. Gordon Campbellrose——

Mr. Maclennan

No, I will not give way. I have only five minutes——

Mr. Campbell

The hon. Gentleman did not hear: he must have been away.

Mr. Maclennan

Likewise, on 27th October the right hon. Gentleman produced his White Paper on the Local Employment Act provisions. He could not even tell us then, having had months of the summer, whether or not we were to have special legislation to implement his proposals on that score. What does he do in these long silences?

The Under-Secretary of State for Development has a peculiar responsibility for the Highlands. A signatory of the Select Committee Report, he appears, from the moment he gained office, to have ignored its every recommendation. The key rôle of industrial development certificates in the development of Scottish industry he now carefully ignores. I do not know how he has the effrontery to speak on this subject, in the light of what he has done.

We had the recommendation of the Committee that we should increase the flexibility of the Highland and Islands Development Board. The Under-Secretary knows that the former chairman gave in evidence the view that the limit of spending power of the board should be raised from £50,000 to £100,000 per annum. The hon. Gentleman went to the Highlands, to Inverness, in July, and after this meeting with the board it was announced that in the meantime the board would not press this on the Government. Clearly exercising his pressure, the hon. Gentleman made it embarrassing for the board to get what it had asked for and what he himself had recognised, in signing the Report was necessary.

I should have liked to ask the hon. Gentleman, had there been time, what action he and his Ministry of so-called Development are doing on the conditions attached to the grant-in-aid to the board, which, it was stated by the then chairman, should be modified to allow the board greater flexibility and freedom.

Although we have not had any statement on the Government's policy towards the Highlands since the Adjournment debate which I managed to get in the summer, we have had a speech, an extraordinary speech, demonstrating a total ignorance of Highland problems, in another place by the Minister of State. She demonstrated that she, too, is exercising pressure on the Highlands and Islands Development Board to limit its rôle and curtail its freedom.

I intervened earlier to point out what the Minister of State had admitted. It is reported in c. 970 of the OFFICIAL REPORT of the other place for 27th January. She admitted what the Government had done for the promotional efforts of the Board. Because of the pettifogging £20,000 which was given to the Scottish Council for the promotion of the whole of Scottish industry, the Highlands and Islands Development Board has been prevailed upon—the word used is "persuaded"—to abstain from its promotional exercise in Germany and the United States. This exercise was following up its successful endeavours of last Autumn, in which it was estimated that almost £100,000 had been spent to promote industry, from which 839 positive inquiries had been received.

This retrograde action on the part of the Government has been contrary to the recommendations of the Select Committee, which specifically said that the promotional work of the Highlands and Islands Development Board had been invaluable and should be encouraged. But the Government, as in all other matters, have overlooked the recommendations of the Select Committee.

Most profoundly ignorant of all were the remarks of the Minister of State in another place about the kind of industry the Highlands need. It was this Government which, when in Opposition, upbraided us for coming down on the service industries. I accuse them of coming down on capital intensive industries, and nothing is more dangerous to the future of the Highlands, as for the whole of Scotland, than that.

This shows that the Government are completely lacking in awareness of the needs of Scotland. We cannot rely on dying industries. Old indigenous industries must, of course, be supported where they exist, but we cannot live on them alone. Had we not seized the nettle and backed the Invergordon scheme, as well as the Dounreay fast reactor, the position would indeed be sad today.

The Minister of State said: But as the House knows, such large-scale enterprises are capital intensive and do not in themselves bring much further employment to the area."—[OFFICIAL REPORT, House of Lords, 27th January, 1971; Vol. 314, c. 968.] The Invergordon scheme has brought 600 jobs to the area, and few places in the Highlands would not welcome 600 new jobs.

But that is not all. The Select Committee specifically pointed out that, in its view, capital intensive industries brought other industries in their path. Naturally, the service industries in the area have benefitted from this, including the shops, hotels, laundries and garages. But these industries will suffer if the Government do not help the capital intensive industries; and, unfortunately, these industries are being harmed by the switch away from investment grants.

Time does not allow me to catalogue the incompetence and muddled thinking in the Government's regional policy. They have adopted a piecemeal approach, introducing one measure and not being able to fit it into a rational plan for Scotland. We have had an announcement off the cuff, as it were, about proposed special measures for the West of Scotland, but not a word about what the effects of that will be on the rest of Scotland. I welcome what has been announced—one is thankful for small mercies—but the Government should be looking at the planned development of Scotland as a whole.

Last Tuesday the Secretary of State for the Environment said that the Government's review of regional policy was not yet complete. After seven months in office, it is not yet complete. Despite that, the Government bring forward this petty little measure today and they cannot even tell us whether they need legislation to bring it into effect. Scotland needs leadership, not this.

9.5 p.m.

Dr. J. Dickson Mabon (Greenock)

I have managed to hear, if not all of every speech, at least part of every speech. Therefore, to some extent I have a slight advantage over the Under-Secretary, who must rely on the notes of his right hon. and hon. Friends for at least two or three hours of the debate when he was absent, if he is to refer to all those who took part in the debate.

Every speaker has made a valuable contribution. Those hon. Members who thanked the Select Committee—I join them—were perfectly right to do so and, in particular to single out our old colleague Tom Steele for his excellent chairmanship of the Committee.

I echo the views of my hon. Friend the Member for Paisley (Mr. John Robertson) about the need for the Committee to be reconstituted. I greatly hope that the Under-Secretary, apart from the political points that he will doubtless want to make, will try to answer this point as a Member of the House. We are anxious that the Committee should be reconstituted so that more of these matters can be examined in depth.

It was inevitable that the Committee chose such a wide remit which enabled it to identify possible points of future inquiry. The hon. Member for Galloway (Mr. Brewis), who served the Committee so well along with my hon. Friend the Member for Paisley, made a good point when he talked about the good work of the Development Commission. Perhaps we in Scotland do not use the Development Commission as we should. In my time at the Scottish Office we helped to expand its activities, and many a row I had about taking the interests of the Commission from Wales occasionally up to Scotland.

The hon. Member for Inverness (Mr. Russell Johnston), in his plea that the Committee should be reconstituted and given some more tasks, underlined the belief of many people that the Committee still has a great job to do.

There have been two very interesting developments in the debate. One was certainly predictable. I was a little surprised about the other.

The predictable development was that something had to be done by the Government about the crisis in West Central Scotland. There is no doubt that the collapse of industries there in such swift succession and the closures present a very serious challenge to the Government. The Labour Government recognised that with the rapid decline of jobs in the older industries something had to be done to bring cohesion to West Central Scotland.

The hon. Member for Ayr (Mr. Younger) inherited the plans we had for reconstituting the Clyde Valley Advisory Committee. That was a very long and difficult battle. We wanted the Committee in its enlarged form to be an economic consultative group to promote the interests of the area. To some extent that plan has been abandoned or adulterated—I am not sure which is the more appropriate word. Certainly there is no money available for promoting the interests of West Central Scotland.

Perhaps there is a case for saying that the constitution of West Central Scotland as a special development area as announced today is a better solution or part of a solution. As we had no knowledge that the Secretary of State intended to make such an announcement, naturally we shall want to study the announcement; but prima facie it looks as if it is a good step forward.

I counsel the hon. and gallant Member for Aberdeenshire, West (Lieut.-Colonel Colin Mitchell) and the hon. Members for Aberdeenshire, East (Mr. Wolrige-Gordon) and Ross and Cromarty (Mr. Gray) not to be too distressed about the possible counter-productive effect in the Highlands or in Aberdeenshire as a consequence of West Central Scotland being declared to be a special development area. The North-East of Scotland always had a very bad rate of emigration. Indeed, at one time it had the highest rate of all the Scottish regions. However, times have changed and the figures have changed also, the highest rate being now in West Central Scotland and it is there that half of Scotland lies bleeding to death. This is why the strategy to some extent must be altered.

The hon. Member for Fife, East (Sir J. Gilmour) very sensibly argued that regional policy is, after all, a continuing process; there is a legitimate time for changing policies. This is why we in our time were willing to examine our own policies. Even though the industrial incentives and other apparatus that we set up were established only in 1966 and began to take effect only in 1967 and 1968, we were willing, as all intelligent people should be, to examine our policy and see if it was being as effective as it should be. I shall touch on this point again later. We will facilitate the passage of any legislation involved in the establishment of the S.D.A. If none is required, we are glad.

Mr. Gordon Campbellrose——

Dr. Mabon

We shall be glad if the right hon. Gentleman can clear up the position when he is able to see his way through his muddle. I want to give the Under-Secretary of State time to reply to the debate and it would be wrong if he did not make a constructive reply. As I have said, I have great regard for the right hon. Gentleman and would willingly sit down if I thought that he was going to make a useful point.

But the S.D.A., no matter how much we assist it, will in no way make up for the loss of investment grants and for the failure to announce new incentives to follow the regional employment premium which is to be abolished in 1974. In no way does this announcement of the S.D.A. compensate for what we are complaining about—the smashing of two if not three of the legs of this stool.

My hon. Friend the Member for Hunterston—I am sorry, for Central Ayrshire (Mr. Lambie)—that was a truly Freudian slip—talked about Hunterston and was supported in his remarks on the consequences to the steel industry by my hon. Friends the Members for Motherwell (Mr. Lawson) and Bothwell (Mr. James Hamilton). I wonder whether one of the firms at Hunterston is one of the 30 mentioned in The Times report which my right hon. Friend the Member for Kilmarnock (Mr. Ross) quoted. Thirty major firms have been chased away from Great Britain or have become unwilling to invest in Great Britain because of the Government's sudden switch in policy. Perhaps the Secretary of State, if he cannot refer to all the firms involved will refer to some of them at some stage, or perhaps the Under-Secretary of State in reply tonight will tell us which of these major firms he knows about have refused to come because of the switch in policy.

I suggest that the total is more than 30. One by one we will winkle out the names. If the right hon. Gentleman is able to tell the Under-Secretary of State what comments he should make, it will no doubt improve the hon. Gentleman's speech no end. We will then be able to measure whether or not they are the kind of firms resented by the hon. Member for South Angus (Mr. Bruce-Gardyne), who, as the one time financial correspondent of The Spectator, told us how wicked we were to give money to various aluminium smelter firms which established themselves in Wales, Blyth and Invergordon. [HON. MEMBERS: "Where is he?"] He has gone to find out whether the Government need legislation or not.

The speech by the Secretary of State was remarkable. He said that when the Government got into office they had to have an urgent and full review and announce the results on 27th October. The results swept away the work of the Select Committee. [Interruption.] I do not want to embarrass the hon. Member for Perth and East Perthshire (Mr. MacArthur), but I will try. Having told us how important it was to do this, the right hon. Gentleman then said that it was not possible for him to deal with present unemployment quite so quickly. That was a curious contrast. I suspect that his speech was not written in the Scottish Office but in Tory Central Office. There was an interesting contradiction in the speech between the urgency of the future period which is not to end until 1974 and the non-urgency, apparently, of the present, which is this winter. It was a curious contrast in priorities.

The hon. Member for Inverness, when touching on the comment by my hon. Friend the Member for Central Ayrshire about Hunterston, spoke of the activities of the Minister for Transport Industries, the man who made a mess in the Mersey Docks and Harbour Board controversy, the man who has undermined confidence in private investment in the docks and who no doubt has made a contribution, an adverse contribution, to the help necessary for the Clyde port to provide the facilities which the Secretary of State for Scotland has sanctioned in a unique and equivocal decision letter which has still to be resolved. We do want to know what the British Steel Corporation is thinking of doing at Hunterston.

The Under-Secretary would be well advised to comment on this and, if we may know, what Chevron Oil is thinking of doing, whether it has been given the promised statement which was mentioned in the decision letter. I do not know whether Hunterston is to be in the S.D.A. area. I could not divine that from the Secretary of State's vague announcement. No doubt we shall find out tomorrow or later this week.

The Prime Minister is a prisoner of his own words about special aid to Glasgow, for on 11th June he said: I will give special aid to the city". He meant special financial aid, or so he was interpreted by the Tory treasurer of the city. The friends of hon. Members opposite in the corporation believe that it is financial aid to the city. But the hon. Gentleman saved up his announcement for the debate. This is unfair debating, but this is the way in which he unfairly treats the House of Commons, and no doubt he will explain it all in his speech. He has made no mention of financial aid to the city, and we should like to know what financial aid, if any, it is to be.

If it is to be financial aid to the city may we know whether, in conformity with the Tory manifesto, "intolerable burdens" are to be placed on those areas outside Glasgow in which housing is built for Glasgow's needs? That means Stirlingshire, possibly Dunbartonshire, certainly Lanarkshire and Renfrewshire.

I agree that Dunbartonshire has made no compact and we cannot make any claims there. No doubt it is a mouse of a scheme.

In Erskine, after a bitter fight with the Tories in Glasgow holding us up for 18 months, we launched a scheme for 30,000 houses of which 20,000 were to be in the public sector. The Conservative convener of my own county, Renfrew, is asking for that ratio to be one to one instead of two to three, but I hope that the Government will resist that proposal and stick to 20,000 houses for the public sector and 10,000 for the private, for that seems a fair balance. The 20,000 houses were approved as an amendment by my right hon. Friend to the Renfrewshire development plan several years ago.

We authorised the East Kilbride Development Corporation to build 3,000 houses extra in East Kilbride to be set aside for Glasgow citizens, for the town council generously said that it would waive its rights to them because of the importance of Glasgow's problem. We also commissioned the East Kilbride Development Corporation to build a new town of 65,000 people at Larkhall/Stonehouse and we committed ourselves to 2,000 houses for the S.S.H.A. in that new town. Admittedly, we were not going to designate new town status at once, but we were doing all the planning work, The Tories skated out of office in 1964 having promised in the August of that year to build Irvine. We had to do all the legislative, statutory and promotional work to create Irvine and it took four years to start it properly. I can therefore hardly claim that we established a new town, but we began the work at Larkhall/Stonehouse.

Those are all the things we have done. At Cumbernauld New Town there were to be some 2,000 houses and in Stirlingshire 5,000 at Lennoxtown and Milton of Campsie. These were all to be provided for Glasgow, or at least 3,500. That is a formidable total of houses. The Secretary of State's announcement today, if it means anything, means more than that, but I cannot understand what he is doing more than that formidable total. Perhaps it was a non-announcement; we shall wait and see.

We have debated housing before and the hon. Gentleman and his right hon. Friend have skated away from targets and commitments as fast as they see them coming. As my hon. Friend the Member for Fife, West (Mr. William Hamilton) clearly demonstrated, the same number of houses cannot be built with the same amount of money without reducing standards. That is because of the present annual increase in housing costs, quite apart from inflation, largely because of wage rates and materials, common throughout the world. Then there is the famous S.E.T., which incidentally will become V.A.T. Do not imagine that its abolition means a bonus. The Prime Minister, if he takes the country into the Common Market is obliged to impose V.A.T. in place of S.E.T.

Mr. MacArthur

Not on housing.

Dr. Mabon

Yes. The hon. Gentleman does not know his common Market. Every service and manufacture. Within the Glasgow context, if all these houses which have been promised are to be built and yet the volume of housing in financial terms is to remain the same, it means that the number of houses built in the rest of Scotland will be much smaller.

There are no target figures. I asked the right hon. Gentleman today to confirm that he would try for 44,000 but he is not having that. At present the Government are heading for 30,000 a year—in other words, what their predecessors did 10 years ago. Yet I can remember the great revival of 1951 when the Tory Party claimed that they would build 300,000 houses a year. We debated these later targets in manifestos. In 1966 they said they could get 50,000, or 500,000 in the United Kingdom. Now the Tory Party are ratting on that.

Mr. MacArthur

What did you do?

Dr. Mabon

We did 44,537 and that is the very best year in Scotland's history. I ask: may we just get that in one of the next few years while the Tory Party are in office? It is not too much to ask, but I doubt whether we will get it.

The Under-Secretary went to a conference in Bonn. This was a conference of Ministers in charge of regional development and I read the interesting report. I attended a debate on the subject quite recently. The hon. Gentleman is on record as saying that the general position about infrastructure was splendid; there were improvements still to be done, a great rolling programme, but on the whole the picture was good and—this is a very good selling point for Scotland—we have very good roads, very good sewerage systems, plenty of good water, good water boards—and we all remember that wonderful Act of 1967. This is not my description, this is summarised at page 95 where it is said clearly in paragraph VII.20 that Scotland's infrastructure is splendid. That is what the Committee says.

Who created the infrastructure? We did. They printed all the papers and all the pamphlets, but we built all the roads. We doubled the road system in six years, from 100 miles of dual carriageway to 209 miles. We set a splendid example in housing, we spent a good deal of money on all kinds of infrastructure. It is said in this Report that Scotland, of all European countries, is well ahead in infrastructure. To whom does the credit go? Obviously to the Labour Government. The hon. Gentleman has given £20,000 to the Scottish Council, less than a penny a head, to promote the whole of Scotland. That was as a result of his visit to Germany. He thought that we ought to promote ourselves in Germany, little realising the costs of promotion.

The Highlands Board requires £100,000 for 250,000 people. It is right to spend that money. The hon. Gentleman suggests that Scotland should have £20,000 and tells the other areas and parts of Scotland not to ask individually for money, because the Government are promoting Scotland as a whole. He is being absurd. This is ridiculous. Scotland needs a £1 million promotion programme overseas to try to attract investors and to get industries in the South and Midlands of England to go to Scotland.

I turn to the Amendment. We have complained about the disappearance of the direct investment incentives. In paragraph IV.49 on page 55 of the Select Committee's Report there is reference to the pilot study which was carried out by the Ministry of Technology to discover whether a full survey should be carried out into industrial grants as against industrial allowances. Right hon. and hon. Members opposite took office and issued on 18th January, 1971, their own pejorative version of the summary. They say that they have decided not to do a complete study of this subject. But in fact they were committed by the Tory manifesto not to do so.

The Secretary of State, in a curious act of logic today said that because in 1969 we had not observed the restriction on industrial development certificates, imposed by ourselves to some extent, he could abandon it permanently. He thinks that because we did not observe it in one year the Tories need not observe it ever again. So we have this substantial concession to the 10,000 sq. ft. limit in I.D.C.s.

There is this curious argument on which we must have some answers about the reduction in regional expenditure. The figures as I understand them are these, leaving aside the difficult years of transition. The saving by the abolition of investment grants in 1972–73 will be £365 million. It will rise to £600 million by 1974–75. But the cost of capital allowances, which will replace investment grants, will be £235 million, rising to £485 million in 1974–75. So the Government will gain £130 million in the first year I mentioned and £115 million in the last year I mentioned. I do not know how one assesses the reduction in corporation tax, but there are itemised savings in other expenditures on industry, and so on. There is to be a saving of £44 million in 1972–73 and £105 million in 1974–75.

That represents a clear profit for the Government from the monetary, fiscal cuts in regional investment. Whatever the Secretary of State says, he cannot skate away from that fact. This is a saving of Government money. The same amount of money is not being invested.

I should like the Under-Secretary of State for Development to tell us how these figures are reflected in Scottish terms and how Scotland is to get out of its difficult situation. The Government have ignored the Select Committee entirely. They have even ignored their advisers. Professor Campbell, who as far as I am aware is not a dedicated Socialist, of the Chair of Applied Economics at Dundee University and an economic adviser to the Secretary of State and co-author of the Tayside Study together with the Chief Planning Officer of the Scottish Development Department—[HON. MEMBERS: "It is a good plan."] —the plan is good; I am not sure about the prospects.

Last weekend, Professor Campbell described his plan as he saw it. He said that the Tayside people had to recognise that there were new obstacles to the realisation of his plan for Tayside. He said: Recent changes in regional development policy would also make it much more difficult for the region to attract the jobs needed both to counteract the decline in existing industry and provide a base for future growth. Who, looking at Dundee and seeing recent events there, cannot be worried about what is happening in that great city and the hinterland and which is so valuable to us in terms of the study?

I charge the Government that they ignored the pilot study which we left them, the Select Committee, their own economic advisers and the officials in the Scottish Office in order to embrace, in a doctrinaire, blind way, their manifesto.

Mr. MacArthur

Hear, hear.

Dr. Mahon

There are none so blind as those who cannot see.

They embraced their manifesto and declared their position before they had any of the instruments of Government at their hand to decide how they should conduct themselves and what would be in the best interests of Scotland. In other words, they behaved irresponsibly; they behaved in ignorance; they behaved with that enormous conceit and arrogance which we always associate with the Tory Party in power. For that we condemn them roundly tonight.

9.30 p.m.

The Under-Secretary of State for Development, Scottish Office (Mr. George Younger)

I am very glad that we have had the chance of this debate today. It started off as a debate, for which we have all been waiting a long time, on the Report of the Select Committee on Scottish Affairs. It also developed in part as that, but in part it developed into what was almost a survey of the Scottish economy.

I should like to start by saying just a very few words about the Select Committee itself, having myself been a member of it, and I would like to do so because I have felt for some time that I should like to say one or two things about it. I found it to be an absolutely fascinating, most enjoyable, most useful experience, which I thoroughly enjoyed, and which I would not have missed for anything, and I would advise anyone in this House who has a chance of being on a Select Committee to take that chance with both hands, because not only did I enjoy it very much but I found it most valuable in every way.

However, there are one or two things which I think ought to be said about Select Committees—this is a personal view of mine—as they affect Scotland. A Select Committee depends, I think, for its success on the feeling among the members of the Committee, the feeling of getting together and making, as it were, common cause to probe and find the ultimate truth from those whom it cross-examines. The most successful Select Committee—and most of them are successful—achieves this very well. The only question mark I would put, and I am speaking personally, is that I myself wonder whether we in Scotland do not know one another too well to get this particular form of dialogue between the members of the Committee and the people whom we cross-examine. This is a personal experience; it may not be the experience of other hon. Members on the Committee with me; I do not know.

Nevertheless, I myself have felt that we ought to think carefully about how we handle these things in Scotland, because I felt that we really were not able to get at the fundamental points, which we really thought we ought to investigate, because we were too much involved with one another in our daily political battles and because of the fact that we know one another too well, in a way, to get the best out of the Committee. This is a personal view, and any hon. Member is at liberty to disagree with me, but I felt it only right to say that, seeing that we are discussing that Committee today.

There are some very good parts of the Select Committee's Report, which are in every way very well worth while having. In particular I would refer to the remarkably interesting evidence presented by the then Minister of Technology, who gave a most impressive performance, very worth while measured by any standards, and, with respect, I would say that the right hon. Gentleman the Member for Kilmarnock (Mr. Ross) gave evidence which was extremely fascinating to all of us in the Committee. It was at least to me. I thought it first class.

Having said that, there is one further thing which I would like to say. I think that hon. Members on both sides of the House will agree with me. I would say how very impressed I think we all were by the fairness and patience of Mr. Tom Steele who acted as Chairman of the Committee, which was, at times, by no means easy. I should like in this tribute to join with him the hon. Member for Paisley (Mr. John Robertson) and my hon. Friend the Member for Galloway (Mr. Brewis), who acted as a sort of deputy Chairman, and did a very good job indeed.

Mr. Lawson

Would the hon. Gentleman say a word about the Clerks?

Mr. Younger

Yes. I thank the hon. Gentleman very much. As is the case with all Select Committees, we were helped immensely by the services of our Clerks and advisers, whose work was most valuable and helped us a lot with ours.

I will answer as many individual points as possible. This has been a most entertaining and interesting debate. The hon. Member for Kilmarnock came along with his biggest pair of gumboots and floundered around producing quotations from odd corners of the Report to support his case, leaving aside all the others that supported the case which he was not putting forward.

The hon. Member for Motherwell (Mr. Lawson) was in one of his cost constructive moods. I much enjoyed his contribution. We had the usual speech from the hon. Member for Central Ayrshire (Mr. Lambie)—I am sorry, the hon. Member for Hunterston—who delighted us by his instruction to Scottish Office Ministers to get off their hind legs. I am not sure what one does when one gets off one's hind legs. The hon. Gentleman was doing what he has been doing since last July. He has been making the speeches which he was preparing to make when my right hon. Friend turned down every part of the Hunterston development. I wonder whether some time he will come back to earth and realise that things have not turned out as he expected. The hon. Member for Greenock (Dr. Dickson Mabon) was his usual knock-about self, and no one was in the slightest bit disappointed about his contribution.

My hon. Friend the Member for Ross and Cromarty (Mr. Gray) asked the Secretary of State to give serious consideration to the economic and social aspects of the proposed closure of the Kyle railway line before giving his consent to the closure proposal. Yes, my right hon. Friend will take those very much into account.

The hon. Member for Paisley said that it was in the new industries rather than in the old ones that we were losing jobs. I do not think that he is quite right in that. It is still the case, as it has been for five years or more, that the main job losses are in agriculture, mining, shipbuilding, metal manufacture, textiles. transport and distribution. There have been one or two recent redundancies in newer industries. In Honeywell Controls there have been 400 redundancies, in Burroughs 370 and in Saxone 250. Inevitably, rationalisation leads to some shakeout in new firms as well as in old ones. There is no doubt, as stated by the firms themselves, that current world market forces are a material factor in this. Honeywell stated this publicly when the news came out. The longer-term prospects for firms of this sort continue to be good. For example, only last week my right hon. Friend opened a new Burroughs factory, offering substantial new employment opportunities at Glenrothes.

The hon. Member for Paisley also asked a specific question about U.C.S. It had not occurred to me that my wind-up speech would contain a list of firms which were not going into liquidation, but I understand that U.C.S. has this afternoon effectively disposed of any such rumours which may be around. This will cause great satisfaction to all hon. Members. Both sides of the House will welcome the great strides that U.C.S. has made in recent months in getting orders for its new standard ships, and we look forward to the realisation of the energetic plans for capturing a further share of the present buoyant world ship building market.

Mr. Tam Dalyell (West Lothian)

Will the Minister dispose of the rumours by giving some indication of what the Cabinet meeting was about in relation to private industry?

Mr. Younger

Even if I knew what went on in Cabinet meetings it would he entirely out of order for me to tell the House.

Mr. Dalyell

I thought that it might scotch the rumours.

Mr. Younger

I hope that I have managed to scotch the rumours suggested by the hon. Member for Paisley.

The hon. Member for Central Ayrshire asked specifically about future plans of the British Steel Corporation. He made the rather unfortunate statement that Scottish steel would be liquidated by 1980, except for one obsolescent plant at Ravenscraig.

Mr. Lambie

I was quoting a statement made by the secretary of the steel workers of Scotland in an article in the Glasgow Herald. Certainly the representative of the steel workers of Scotland is a better source than is the Under-Secretary of State.

Mr. Younger

As the B.S.C. stated at the Hunterston inquiry, the corporation's policy is to increase its productive capacity in Scotland to over 4½ million tons per annum by 1975. Plans for production beyond that are now under consideration, and the Secretary of State's decision to give planning permission for an ore terminal at Hunterston must substantially strengthen Scotland's case for providing deep-water facilities for a new integrated steelworks.

Mr. Lambie

There is a feeling in Scotland that the British Steel Corporation will be willing to invest £6½ million in an ore terminal while at the same time it is willing to spend £200 million on a new integrated plant in the north of England. There cannot be an ore terminal without an integrated steel plant. My case—[HON. MEMBERS: "Speech!"]—and the case of the steel workers of Scotland is that when we get an integrated steel plant an ore terminal must follow. My criticism of the Secretary of State—[HON. MEMBERS: "Too long!"]—is that he is doing nothing at present in these planning stages to influence the B.S.C.

Mr. Younger

I have been far too generous in giving way, and if I continue to do so we shall get nowhere. I have made the position clear in regard to the British Steel Corporation. It is beyond reason for anybody to talk about the complete disappearance of the Scottish steel industry by 1980. I hope that we shall hear nothing more of that.

Mr. Ross

Can we be assured that the Secretary of State is being kept informed of the plans of the B.S.C. on this long-term business of a new integrated plant and that, despite the policy of non-intervention, he still has powers to let the corporation know how we in Scotland feel about the future of the steel industry?

Mr. Younger

Yes, I can state that my right hon. Friend is in the closest touch with what is going on and that he is, and will continue to be, in the closest touch with the corporation about all its future plans, which are, of course, of great interest and importance to us all in Scotland.

I wish to refer to what was said by the right hon. Member for Kilmarnock. First, I wish to make it clear that legislation is not needed to set up a special development area in the Glasgow conurbation and Clydeside. The right hon. Gentleman was not correct in saying that the special development areas were only in areas of coal mine closures. We must remember the exception of Millom where, for special reasons, this policy was implemented. The policy is flexible to that extent. My right hon. Friend made an announcement on this matter today since he thought that the House would wish to be told that this was to be done.

I am glad that, apart from one or two discordant notes, the announcement received a warm welcome as a necessary and valuable addition to the pull which the Clydeside area should from now on be able to command in attracting industry to replace the jobs which it has been losing for some time. I hope that the hon. Member for Caithness and Sutherland (Mr. MacLennan) will not feel at a disadvantage that this is to happen. I am convinced that an effective improvement in the employment situation on Clyde-side would have an effect throughout Scotland in the general prosperity of the country as a whole. I am glad that this announcement was welcomed as a wise and statesmanlike move by my right hon. Friend and the Government.

The right hon. Gentleman then took me to task for ignoring the report of the Select Committee. He would not accept for one moment that all members of all Select Committees should be committed to everything recommended by those Committees for ever more. I do not think that that is what he was suggesting. It is not true that I have in any way ignored all the recommendations of the Report. For instance, the Select Committee made some very trenchant and helpful suggestions for improving the economic planning machinery in Scotland. To a very large extent the changes which my right hon. Friend has introduced go at least some way to meeting the points made very effectively by many people on both sides of the Select Committee. The Scottish Economic Planning Council, with the best of intentions, gave the impression of doing a job which it was not doing. That part of the Report is an example of what is being carried out following its publication.

The main tenor of the right hon. Gentleman's remarks was based on the theory that the Select Committee had found clearly that investment grants were superior to investment allowances. One can find plenty of evidence to suggest that investment grants are a good thing, but the right hon. Gentleman did not refer to any of the evidence suggesting that investment allowances were a good thing. There is the evidence of Professor Wilson and Professor Brown, who were quite outspoken about this, as they were about discrimination against service industries, which was such an undesirable feature of the policy followed by the right hon. Gentleman when he was Secretary of State.

It is not true to give the impression that the Select Committee found in favour of investment allowances or grants. I am glad to see that the right hon. Gentleman is not suggesting that. [Interruption.] The effect of the Report was perfectly clear. The hon. Member for Motherwell was nearer than anyone else to this. It was that the Select Committee's Report was quite equivocal between these two different forms of incentive. It came to the conclusion that more study was needed. That is the only firm conclusion one can take from the Report on this matter.

The be-all and end-all of the argument about grants and allowances comes down in the end to a matter of opinion—[HON. MEMBERS: "No."]—between one side of the House and another, and a matter of opinion—[Interruption.]—between one industrialist and another, and a matter of opinion, as was perfectly clear—[Interruption.]

Mr. Speaker

Order. Mr. Younger.

Mr. Younger

I must get on with my speech otherwise we shall never get anywhere.

The clear message of the Select Committee was that there were arguments both ways. The Government have decided that the balance of advantage for Scotland lies in the new system. It is a system not only of investment allowances but of better grants, bigger grants under the Local Employment Act, 10 per cent. higher building grants—we heard nothing from hon. Members opposite about that —and more generous criteria under the Local Employment Acts as to the number of jobs per pound of loan given—and we heard nothing about that. In the opinion of the Government, which I thoroughly support, the new package is one which is likely to do a better job in attracting new industry than the old one.

We must all listen to the right hon. Gentleman's views on this with great respect. But we must remember that, whether one likes one system or the other, it was crystal clear that the old system was not producing the right results. It the right hon. Gentleman had been able to say that the old system has produced such marvellous results and that we have gained jobs in Scotland all through the years in which it was in progress, it would have been very difficult to suggest making a change. Are we supposed to imagine that it is a coincidence that it was almost exactly the month of March, 1966, when the change took place from a steady gain in jobs to a steady, if not rather larger, loss in jobs in Scotland? One has to be extremely gullible to think that there is no connection between the change in investment incentives and the drastic change in jobs which has caused so much redundancy.

Mr. Rossrose——

Mr. Younger

No. I am sorry. I must continue with my speech.

Mr. Norman Buchan (Renfrew, West)rose——

Hon. Members

Give way.

Mr. Speaker

Order. The hon. Gentleman has not given way.

Mr. Younger

I normally give way, but I have been very kind to a number of hon. Members, and I must get on with my speech. The right hon. Member for Kilmarnock asked me a number of questions, and I will not have time to answer them unless I am allowed to continue my speech.

The right hon. Gentleman asked for more details about the mention made by my right hon. Friend of the housing help for Glasgow. The hon. Member for Greenock also pressed me on this point. My right hon. Friend is aiming to secure the provision of 17,000 extra houses for the redeployment of Glasgow's population which was recommended in the report of the joint working party on Glasgow's housing.

Dr. Dickson Mahon

That has all been done.

Mr. Younger

The hon. Gentleman may have got it wrong. He referred to this in an earlier debate, and I should have corrected him then. These 17,000 houses are additional to all the existing commitments left by the previous Government——

Mr. Ross

They are not.

Mr. Younger

It is a fact that they are. That is why we are setting ourselves to produce the means of implementing the extra 17,000.

Dr. Dickson Mabon

How many in total?

Mr. Younger

The proposed development under new town powers together with the additional programme of S.S.H.A. houses between them should attain that total of 17,000 houses additional to anything calculated at the time that right hon. and hon. Gentlemen opposite were in office. This would provide good housing in good surroundings for something like 60,000 extra people.

What the hon. Member for Greenock did when right hon. and hon. Gentlemen opposite were in office was to talk in general terms about further out-county building. What this Government have done is specifically to earmark the resources to do it, first by co-operation in the working party which identified the problem, second by accepting the conclusions of that working party in full, which were not available to the hon. Gentleman, and third by providing the means through the S.S.H.A.—extra building to anything specified by the S.S.H.A. and the new town powers which are now specifically mentioned—for these houses to be built. I can be specific about this——

Mr. William Hannan (Glasgow, Maryhill) rose——

Mr. Younger

No. Hon. Members are entitled to this information, and I cannot give it unless I am allowed to continue.

What the previous Government did was to announce on 17th January, 1969, that they were willing to pay for the cost of preparing a master plan for a development at Stonehouse and that the planning agency might be the East Kilbride Development Corporation. They did not say that they would do anything to implement it. The intention was to have the plan ready for implementation by re-organised local goverment. The only firm proposal was for a limited development plan amendment at Canderside Toll for 2,000 houses. The amendment is at present under consideration. Nothing else has been able to be done for that. This would have involved about 2,000 S.S.H.A. houses and an industrial estate associated with it.

What is new in this Government's proposal is not simply to prepare a master plan but to consider new town powers to get the building of a new community under way, irrespective of the timing of local government reform. This is completely additional to any of the plans made before. It involves a considerable financial commitment, too. Clearly, if the S.S.H.A. is to build something like an additional 7,000 houses, they will cost the central Government a great deal of money. This is part of a considerable contribution to the Glasgow Corporation's problems.

Mrs. Judith Hart (Lanark)

Are we to understand that there is a precise commitment to 7,000 houses in the Stone-house area in addition to the 2,000 which my hon. Friend earlier announced? Is the East Kilbride Development Corporation to be the agency for building the houses, or has a decision not yet been taken about it?

Mr. Younger

The decision has not finally been taken, but we are prepared to consider putting this proposal to the East Kilbride Development Corporation. It is us to the corporation.

I cannot tie myself to 7,000 extra houses at Stonehouse—[Interruption.]—but there will be a lot of houses in addition to the 2,000 at Canderside Toll. [Interruption.] I am sure that hon. Members opposite will greatly regret it if they laugh too much about this, because it is a real, genuine, extra commitment which has never been given before.

It is no use the Opposition coming to the House tonight at the end of a debate on the Select Committee's Report and making out that the whole of the regional development policy is being changed for the worse by the new Government. Nor is it any use saying that this Government have done nothing in the seven months that they have been in office. We have already changed the whole basis whereby the service industries were discriminated against throughout the Labour Government's period of office. All who are involved in the service industries are now thoroughly delighted and very thankful.

We have already put in hand changes in the regional development policy which, in our opinion, will make a better contribution and bring more jobs to Scotland than in previous years. The one thing which it was not open to us to do when we took office in June was to sit back and say, "Everything is running beautifully. We can leave it all as it stands."

In that context, I wonder what the Opposition think of the fact that their own investment incentives, which have had this effect over the past five years, were running throughout last summer and yet the slide continued.

The right hon. Member for Kilmarnock said that there was a change in investment incentives on 27th October. Surely the right hon. Gentleman must realise that if it were the case that everybody was dreading that change there would have been an avalanche of people trying to get in their developments before it happened. We would have been inundated with applications in July, August and September. That did not happen, as the right hon. Gentleman well knows. Throughout last summer the inexorable trend of the last five years continued. We were losing jobs year by year. This Government were not prepared to allow that situation to go on. Today my right hon. Friend—

Mr. Rossrose——

Mr. Younger

Today my right hon. Friend has shown that he recognises that special measures are needed to deal with the situation which we inherited and which we are honour bound to do something about. That is why my right hon. Friend introduced the proposal for a special development area in the Clyde-side and West Central Scotland areas where the main problem of redundancies and unemployment now lies. This is something which the people in that area can look to as a clear recognition that we know that they need an extra pull to get new jobs into the area. I should like to conclude by mentioning promotion. I hope that no one will sneer at the necessary efforts to co-ordinate and bring together the efforts of the many agencies in Scotland which are going out to England and abroad to encourage new investment and industry to come to Scotland. If we sit back and just complain about our difficulties and troubles we shall never get the new jobs and the new investment which we need. I hope that, irrespective of party political problems or anything else, we can have the

support of hon. Members on both sides of the House for our efforts.

Mr. James Hamilton (Bothwell)rose in his place and claimed to move, That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question put accordingly, That the Amendment be made:—

The House divided: Ayes 268, Noes 312.

Division No. 122.]	AYES	[10.0 p.m.
Abse, Leo	Douglas, Dick (Stirlingshire, E.)	Johnson, Walter (Derby, S.)
Albu, Austen	Douglas-Mann, Bruce	Johnston, Russell (Inverness)
Allaun, Frank (Salford, E.)	Driberg, Tom	Jones, Barry (Flint, E.)
Allen, Scholefield	Duffy, A. E. P.	Jones, Dan (Burnley)
Archer, Peter (Rowley Regis)	Dunn, James A.	Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
Armstrong, Ernest	Dunnett, Jack	Jones, Gwynoro (Carmarthen)
Ashley, Jack	Eadie, Alex	Judd, Frank
Ashton, Joe	Edwards, Robert (Bilston)	Kaufman, Gerald
Atkinson, Norman	Edwards, William (Merioneth)	Kelley, Richard
Bagier, Gordon A. T.	Ellis, Tom	Kinnock, Neil
Barnes, Michael	English, Michael	Lambie, David
Barnett, Joel	Evans, Fred	Lamond, James
Beaney, Alan	Fernyhough, E.	Latham, Arthur
Benn, Rt. Hn. Anthony Wedgwood	Fisher, Mrs.Doris(B'ham,Ladywood)	Lawson, George
Bennett, James (Glasgow, Bridgeton)	Fletcher, Raymond (Ilkeston)	Leadbitter, Ted
Bidwell, Sydney	Fletcher, Ted (Darlington)	Lee, Rt. Hn. Frederick
Bishop, E. S.	Foley, Maurice	Leonard, Dick
Blenkinsop, Arthur	Foot, Michael	Lestor, Miss Joan
Booth, Albert	Ford, Ben	Lever, Rt. Hn. Harold
Bottomley, Rt. Hn. Arthur	Forrester, John	Lewis, Arthur (W. Ham, N.)
Boyden, James (Bishop Auckland)	Fraser, John (Norwood)	Lewis, Ron (Carlisle)
Bradley, Tom	Freeson, Reginald	Lipton, Marcus
Broughton, Sir Alfred	Galpern, Sir Myer	Lomas, Kenneth
Brown, Bob (N'c'tle-upon-Tyne,W.)	Garrett, W. E.	Loughlin, Charles
Brown, Hugh D. (G'gow, Provan)	Gilbert, Dr. John	Lyon, Alexander W. (York)
Brown, Ronald (Shoreditch & F'bury)	Ginsburg David	Lyons, Edward (Bradford, E.)
Buchan, Norman	Golding, John	Mabon, Dr. J. Dickson
Buchanan, Richard (G'gow, Sp'burn)	Gordon Walker, Rt. Hn. P. C.	McBride, Neil
Butler, Mrs. Joyce (Wood Green)	Gourlay, Harry	McCartney, Hugh
Callaghan, Rt. Hn. James	Grant, George (Morpeth)	McElhone, Frank
Campbell, I. (Dunbartonshire, W.)	Grant, John D. (Islington, E.)	McGuire, Michael
Cant, R. B.	Griffiths, Eddie (Brightside)	Mackenzie, Gregor
Carmichael, Neil	Griffiths, Will (Exchange)	Mackie, John
Carter, Ray (Birmingh'm, Northfield)	Gunter, Rt. Hn. R. J.	Mackintosh, John P.
Carter-Jones, Lewis (Eccles)	Hamilton, James (Bothwell)	Maclennan, Robert
Castle, Rt. Hn. Barbara	Hamilton, William (Fife, W.)	McMillan, Tom (Glasgow, C.)
Clark, David (Colne Valley)	Hannan, William (G'gow, Maryhill)	MacPherson, Malcolm
Cocks, Michael (Bristol, S.)	Hardy, Peter	Mahon, Simon (Bootle)
Cohen, Stanley	Harper, Joseph	Mallalieu, J. P. W. (Huddersfield, E.)
Coleman, Donald	Harrison, Walter (Wakefield)	Marks, Kenneth
Concannon, J. D.	Hart, Rt. Hn. Judith	Marquand, David
Conlan, Bernard	Hattersley, Roy	Mason, Rt. Hn. Roy
Corbet, Mrs. Freda	Healey, Rt. Hn. Denis	Mayhew, Christopher
Cox, Thomas (Wandsworth, C.)	Heffer, Eric S.	Meacher, Michael
Crawshaw, Richard	Hilton, W. S.	Mellish, Rt. Hn. Robert
Cronin, John	Horam, John	Mendelson, John
Crossman, Rt. Hn. Richard	Houghton, Rt. Hn. Douglas	Mikardo, Ian
Cunningham, G. (Islington, S.W.)	Howell, Denis (Small Heath)	Millan, Bruce
Cunningham, Dr. J. A. (Whitehaven)	Huckfield, Leslie	Miller, Dr. M. S.
Dalyell, Tam	Hughes, Rt. Hn. Cledwyn (Anglesey)	Milne, Edward (Blyth)
Davidson, Arthur	Hughes, Mark (Durham)	Molloy, William
Davies, Denzil (Llanelly)	Hughes, Robert (Aberdeen, N.)	Morgan, Elystan (Cardiganshire)
Davies, G. Elfed (Rhondda, E.)	Hughes, Roy (Newport)	Morris, Alfred (Wythenshawe)
Davies, Ifor (Gower)	Hunter, Adam	Morris, Charles R. (Openshaw)
Davies, S. O. (Merthyr Tydvil)	Irvine,Rt.Hn.SirArthur(Edge Hill)	Morris, Rt. Hn. John (Aberavon)
Davis, Clinton (Hackney, C.)	Janner, Greville	Mulley, Rt. Hn. Federick
Deakins, Eric	Jay, Rt. Hn. Douglas	Murray, Ronald King
de Freitas, Rt. Hn. Sir Geoffrey	Jeger, Mrs.Lena (H'b'n&St.P'cras,S.)	Ogden, Eric
Delargy, H. J.	Jenkins, Hugh (Putney)	O'Halloran, Michael
Dell, Rt. Hn. Edmund	Jenkins, Rt. Hn. Roy (Stechford)	Oram, Bert
Dempsey, James	John, Brynmor	Orbach, Maurice
Doig, Peter	Johnson, Carol (Lewisham, S.)	Orme, Stanley
Dormand, J. D.	Johnson, James (K'ston-on-Hull, W.)	Oswald, Thomas
Owen, Dr. David (Plymouth, Sutton)	Ross, Rt. Hn. William (Kilmarnock)	Tomney, Frank
Padley, Walter	Sheldon, Robert (Ashton-under-Lyne)	Torney, Tom
Palmer, Arthur	Shore, Rt. Hn. Peter (Stepney)	Tuck, Raphael
Pannel, Rt. Hn. Charles	Short,Rt.Hn.Edward(N'c'tle-u-Tyne)	Urwin, T. W.
Parker, John (Dagenham)	Short,Mrs.Renée (W'hampton,N.E.)	Varley, Eric G.
Parry, Robert (Liverpool, Exchange)	Silkin, Rt. Hn. John (Deptford)	Wainwright, Edwin
Pavitt, Laurie	Silkin, Hn. S. C. (Dulwich)	Walden, Brian (B'm'ham, All Saints)
Peart, Rt. Hn. Fred	Sillars, James	Walker, Harold (Doncaster)
Pendry, Tom	Silverman, Julius	Wallace, George
Pentland, Norman	Skinner, Dennis	Watkins, David
Perry, Ernest G.	Small, William	Weitzman, David
Prentice, Rt. Hn. Reg	Smith, John (Lanarkshire, N.)	Wellbeloved, James
Prescott, John	Spearing, Nigel	Wells, William (Walsall, N.)
Price, J. T. (Westhoughton)	Spriggs, Leslie	White, James (Glasgow, Pollok)
Price, William (Rugby)	Stallard, A. W.	Whitehead, Phillip
Probert, Arthur	Steel, David	Whitlock, William
Rankin, John	Stewart, Donald (Western Isles)	Willey, Rt. Hn. Frederick
Reed, D. (Sedgefield)	Stewart, Rt. Hn. Michael (Fulham)	Williams, Alan (Swansea, W.)
Rees, Merlyn (Leeds, S.)	Stoddart, David (Swindon)	Williams, Mrs. Shirley (Hitchin)
Rhodes, Geoffrey	Stonehouse, Rt. Hn. John	Wilson, Alexander (Hamilton)
Richard, Ivor	Strang, Gavin	Wilson, Rt. Hn. Harold (Huyton)
Roberts, Albert (Normanton)	Strauss, Rt. Hn. G. R.	Wilson, William (Coventry, S.)
Roberts,Rt.Hn.Goronwy(Caernarvon)	Summerskill, Hn. Dr. Shirley	Woof, Robert
Robertson, John (Paisley)	Swain, Thomas
Roderick, Caerwyn E.(Br'c'n&R'dnor)	Thomas, Jeffrey (Abertillery)	TELLERS FOR THE AYES:
Rodgers, William (Stockton-on-Tees)	Thomson, Rt. Hn. G. (Dundee, E.)	Mr. Alan Fitch and
Roper, John	Thorpe, Rt. Hn. Jeremy	Mr. William Hamling.
Rose, Paul B.	Tinn, James
NOES
Adley, Robert	Cooke, Robert	Griffiths, Eldon (Bury St. Edmunds)
Alison, Michael (Barkston Ash)	Coombs, Derek	Grylls, Michael
Allason, James (Hemel Hempstead)	Cooper, A. E.	Gummer, Selwyn
Amery, Rt. Hn. Julian	Cordle, John	Gurden, Harold
Archer, Jeffrey (Louth)	Cormack, Patrick	Hall, Miss Joan (Keighley)
Astor, John	Costain, A. P.	Hall, John (Wycombe)
Atkins, Humphrey	Crouch, David	Hall-Davis, A. G. F.
Awdry, Daniel	Crowder, F. P.	Hamilton, Michael (Salisbury)
Baker, Kenneth (St. Marylebone)	Curran, Charles	Hannam, John (Exeter)
Baker, W. H. K. (Banff)	Dalkeith, Earl of	Harrison, Col. Sir Harwood (Eye)
Balniel, Lord	Davies, Rt. Hn. John (Knutsford)	Harvey, Sir Arthur Vere
Batsford, Brian	d'Avigdor-Goldsmid, Sir Henry	Haselhurst, Alan
Beamish, Col. Sir Tufton	d'Avigdor-Goldsmid, Maj.-Gen. Jack	Hastings, Stephen
Bell, Ronald	Dean, Paul	Havers, Michael
Bennett, Sir Frederic (Torquay)	Deedes, Rt. Hn. W. F.	Hawkins, Paul
Bennett, Dr. Reginald (Gosport)	Digby, Simon Wingfield	Hayhoe, Barney
Benyon, W.	Dixon, Piers	Heath, Rt. Hn. Edward
Berry, Hon. Anthony	Dodds-Parker, Douglas	Heseltine, Michael
Biffen, John	Douglas-Home, Rt. Hn. Sir Alec	Hicks, Robert
Biggs-Davison, John	Drayson, G. B.	Higgins, Terence L.
Blaker, Peter	du Cann, Rt. Hn. Edward	Hiley, Joseph
Boardman, Tom (Leicester, S.W.)	Dykes, Hugh	Hill, John E. B. (Norfolk, S.)
Body, Richard	Eden, Sir John	Hill, James (Southampton, Test)
Boscawen, Robert	Edwards, Nicholas (Pembroke)	Holland, Philip
Bossom, Sir Clive	Elliot, Capt. Walter (Carshalton)	Holt, Miss Mary
Bowden, Andrew	Elliott, R. W. (N'c'tle-upon-Tyne,N.)	Hordern, Peter
Boyd-Carpenter, Rt. Hn. John	Emery, Peter	Hornby, Richard
Braine, Bernard	Eyre, Reginald	Hornsby-Smith, Rt. Hn. Dame Patricia
Bray, Ronald	Farr, John	Howe, Hn. Sir Geoffrey (Reigate)
Brewis, John	Fell, Anthony	Howell, David (Guildford)
Brinton, Sir Tatton	Fenner, Mrs. Peggy	Howell, Ralph (Norfolk, N.)
Brocklebank-Fowler, Christopher	Finsberg, Geoffrey (Hampstead)	Hunt, John
Brown, Sir Edward (Bath)	Fletcher-Cooke, Charles	Iremonger, T. L.
Bruce-Gardyne, J.	Fookes, Miss Janet	Irvine, Bryant Godman (Rye)
Bryan, Paul	Fortescue, Tim	James, David
Buchanan-Smith, Alick(Angus,N&M)	Foster, Sir John	Jenkin, Patrick (Woodford)
Buck, Antony	Fowler, Norman	Jennings, J. C. (Burton)
Bullus, Sir Eric	Fox, Marcus	Jessel, Toby
Burden, F. A.	Fraser,Rt.Hn.Hugh(St'fford & Stone)	Johnson Smith, G. (E. Grinstead)
Butler, Adam (Bosworth)	Fry, Peter	Jopling, Michael
Campbell, Rt.Hn.G.(Moray&Nairn)	Galbraith, Hn. T. G.	Joseph, Rt. Hn. Sir Keith
Carlisle, Mark	Gardner, Edward	Kaberry, Sir Donald
Cary, Sir Robert	Gibson-Watt, David	Kellett, Mrs. Elaine
Channon, Paul	Gilmour, Ian (Norfolk, C.)	Kershaw, Anthony
Chapman, Sydney	Gilmour, Sir John (Fife, E.)	Kilfedder, James
Chataway, Rt. Hn. Christopher	Glyn, Dr. Alan	Kimball, Marcus
Chichester-Clark, R.	Goodhart, Philip	King, Evelyn (Dorset, S.)
Churchill, W. S.	Gorst, John	King, Tom (Bridgwater)
Clark, William (Surrey, E.)	Gower, Raymond	Kinsey, J. R.
Clarke, Kenneth (Rushcliffe)	Gray, Hamish	Kitson, Timothy
Clegg, Walter	Green, Alan	Knight, Mrs. Jill
Cockeram, Eric	Grieve, Percy	Knox, David

Lambton, Anthony	Oppenheim, Mrs. Sally	Spence, John
Lane, David	Orr, Capt. L. P. S.	Sproat, Iain
Langford-Holt, Sir John	Osborn, John	Stainton, Keith
Legge-Bourke, Sir Harry	Owen, Idris (Stockport, N.)	Stanbrook, Ivor
Le Marchant, Spencer	Page, Graham (Crosby)	Stewart-Smith, D. G. (Belper)
Lewis, Kenneth (Rutland)	Page, John (Harrow, W.)	Stodart, Anthony (Edinburgh, W.)
Lloyd,Rt.Hn.Geoffrey(Sut'nC'dfield)	Paisley, Mr. Ian	Stoddart-Scott, Col. Sir M.
Lloyd, Ian (P'tsm'th, Langstone)	Parkinson, Cecil (Enfield, W.)	Stokes, John
Longden, Gilbert	Peel, John	Stuttaford, Dr. Tom
Loveridge, John	Percival, Ian	Sutcliffe, John
McAdden, Sir Stephen	Peyton, Rt. Hn. John	Tapsell, Peter
MacArthur, Ian	Pike, Miss Mervyn	Taylor, Sir Charles (Eastbourne)
McCrindle, R. A.	Pink, R. Bonner	Taylor,Edward M.(G'gow,Cathcart)
McLaren, Martin	Pounder, Rafton	Taylor, Frank (Moss Side)
Maclean, Sir Fitzroy	Powell, Rt. Hn. J. Enoch	Taylor, Robert (Croydon, N.W.)
McMaster, Stanley	Price, David (Eastleigh)	Tebbit, Norman
Macmillan, Maurice (Farnham)	Prior, Rt. Hn. J. M. L.	Temple, John M.
McNair-Wilson, Michael	Proudfoot, Wilfred	Thatcher, Rt. Hn. Mrs. Margaret
McNair-Wilson, Patrick (NewForest)	Pym, Rt. Hn. Francis	Thomas, John Stradling (Monmouth)
Maddan, Martin	Quennell, Miss J. M.	Thomas, Rt Hn. Peter (Hendon, S.)
Madel, David	Raison, Timothy	Thompson, Sir Richard (Croydon, S.)
Maginnis, John E.	Ramsden, Rt. Hn. James	Tilney, John
Marples, Rt. Hn. Ernest	Rawlinson, Rt. Hn. Sir Peter	Trafford, Dr. Anthony
Marten, Neil	Redmond, Robert	Trew, Peter
Mather, Carol	Reed, Laurance (Bolton, E.)	Tugendhat, Christopher
Maude, Angus	Rees, Peter (Dover)	Turton, Rt. Hn. R. H.
Maudling, Rt. Hn. Reginald	Rees-Davies, W. R.	Vaughan, Dr. Gerard
Mawby, Ray	Renton, Rt. Hn. Sir David	Vickers, Dame Joan
Maxwell-Hyslop, R. J.	Rhys, Williams, Sir Brandon	Waddington, David
Meyer, Sir Anthony	Ridley, Hn. Nicholas	Walder, David (Clitheroe)
Mills, Peter (Torrington)	Ridsdale, Julian	Walker, Rt. Hn. Peter (Worcester)
Mills, Stratton (Belfast, N.)	Rippon, Rt. Hn. Geoffrey	Walker-Smith, Rt. Hn. Sir Derek
Miscampbell, Norman	Roberts, Michael (Cardiff, N.)	Wall, Patrick
Mitchell,Lt.-Col.C.(Aberdeenshire,W)	Roberts, Wyn (Conway)	Walters, Dennis
Mitchell, David (Basingstoke)	Rodgers, Sir John (Sevenoaks)	Ward, Dame Irene
Moate, Roger	Rossi, Hugh (Hornsey)	Warren, Kenneth
Molyneaux, James	Rost, Peter	Weatherill, Bernard
Money, Ernie	Royle, Anthony	Wells, John (Maidstone)
Monks, Mrs. Connie	Russell, Sir Ronald	White, Roger (Gravesend)
Montgomery, Fergus	St. John-Stevas, Norman	Whitelaw, Rt. Hn. William
More, Jasper	Sandys, Rt. Hn. D.	Wiggin, Jerry
Morgan, Geraint (Denbigh)	Scott, Nicholas	Wilkinson, John
Morgan-Giles, Rear-Adm.	Scott-Hopkins, James	Wolrige-Gordon, Patrick
Morrison, Charles (Devizes)	Sharples, Richard	Wood, Rt. Hn. Richard
Mudd, David	Shaw, Michael (Sc'b'gh & Whitby)	Woodhouse, Hn. Christopher
Murton, Oscar	Shelton, William (Clapham)	Worsley, Marcus
Nabarro, Sir Gerald	Simeons, Charles	Wylie, Rt. Hn. N. R.
Neave, Airey	Sinclair, Sir George	Younger, Hn. George
Nicholls, Sir Harmar	Skeet, T. H. H.
Noble, Rt. Hn. Michael	Smith, Dudley (W 'wick & L'mington)	TELLERS FOR THE NOES:
Normanton, Tom	Soref, Harold	Mr. Hector Monro and
Nott, John	Speed, Keith	Mr. Victor Goodhew
Onslow, Cranley

Main Question put and agreed to.

Resolved, That this House takes note of the Report of the Select Committee on Scottish Affairs in Session 1969–70 on Economic Planning in Scotland (House of Commons Paper No. 267).