§ Motion made and Question proposed, That this House do now adjourn.—[Mr. Hawkins.]
§ 11.32 p.m.
§ Mr. Goronwy Roberts (Caernarvon)I am glad of this opportunity of drawing urgent attention to the problem of unemployment in the Caernarvon area.
The first ten months of the present Government have seen a catastrophic increase in the percentage of unemployed in the area. In April, 1970, it was about 6.9 per cent.—far too high, but showing prospects of further reductions as industrialists responded to the special inducements of the then Labour Government to industries which wished to enter the area. Since then, those inducements have been drastically changed and reduced by the present Government. Industrialists are showing little interest in entering the area and some of those already established are doubtful about expanding. The unemployment percentage has shot up to 10.8 per cent. in the Caernarvon district and 7.7 per cent. in the Pwllheli district.
To say the least, the Government have not helped. They discontinued the special roads programme last winter—not a small matter, especially for the 40 men thrown out of work. But what has sapped confidence in the area, deterring new industries from coming in and disturbing those already established, is the decision last October to do away with the investment grants. My first plea is for their restoration, at least in areas of high unemployment.
I imagine that it would be out of order to refer to the Bill dealing with investment now before the House, but I suggest that the Chancellor's statement of last October should in the meantime be so interpreted that proof of genuine intention to expand before 26th October should qualify for an investment grant which provides such an essential cash flow for the type of industry which comes in areas like ours.
For example, about two years ago a first-class engineering firm accepted the tenancy of a 26,000 square ft. advance factory in Caernarvon. It was exactly the kind of modern industry we need, and on the basis of very good management and an excellent labour force, it made 1335 rapid progress. With the strong encouragement of Government Departments, it then planned to expand. The proposal would more than double the factory space and add between 100 and 150 men to the payroll.
The position now is that the expansion of factory space has been approved but the investment grant for the necessary machinery to be placed in that space, and on which the firm rightly counted, is not forthcoming because the formal contracts for new machinery had not been placed before the statement by the Chancellor of the Exchequer of 27th October.
Government Departments were aware of every step in the thinking and planing of the firm. They knew, and know, better than anyone of the firm's genuine intention to go for the new machinery. Indeed, they knew that it was the availability of the grant which persuaded the firm to go ahead. And yet the firm is committed to that new building with no grant aid towards the new machinery needed to convert that building into a factory.
It will be years before these extra jobs, so badly needed in this area, will be made available, because under the new regulations the firm must wait until it makes enough taxable income to qualify for the new allowance. I ask the Minister of State to look at this case, the details of which I am sending him separately.
The other major deterrent to new industry to choose a development area such as ours is the extraordinary decision last December to raise the ceiling of permitted factory building in non-development areas. This encourages industry to expand in the already congested districts rather than to move into development areas.
In Penygroes, as the Minister of State knows, there is a large Government-built factory which has been empty for months. In Portmadoc, 10 miles away, we have a Government-built factory which has been half-used for months. Does the Minister think that a new tenant for the one and full use of the other is more or less probable now that industrialists have this added encouragement to start or to expand outside development areas?
I turn to the question of planning for industry, and here again I have a specific 1336 case to draw to the Minister's attention. The Lleyn Peninsula is an area of outstanding beauty and it is also one of continuing depopulation. The true beauty of the area rests on its community life, sustaining a distinctive culture and language, and its attachment still to the higher virtues of religion. But if this community is to survive, the people must have work and wages, and that means new industry.
Our very highly automated agriculture cannot provide the new jobs we need. nor indeed can tourism, which, as I have said before in the hearing of the Minister of State, is a seasonal addition and not a permanent substantive. To get this new industry it is essential to relax planning restrictions and to speed planning procedures. I was fascinated to listen to the debate which immediately preceded this and to feel that on both sides of the House there is now a feeling that it is too restrictive, especially in rural areas, which depend very much on swift acceptance of a proposal by an industrialist to go into the area. At the moment the planning restrictions and procedures are working strongly against the introduction of badly needed new industry in areas such as South Caernarvonshire.
Let me give an example. More than a year ago a substantial Midlands industrialist was good enough to consult me about a proposal to set up a research laboratory and a factory for the manufacturing of modern heating apparatus in a town on the south coast of Caernarvon-shire. There was the inevitable uproar among the scenic enthusiasts, many of them writing from places like Sheffield and the Home Counties where work is relatively abundant. But the local authorities up to county level approved the proposal, because it would create worthwhile jobs and opportunities in modern engineering for upwards of 75 school-leavers in the district.
That should have been that. But it appears that this proposal must be subjected to appeal and public inquiry procedures, involving months of delay and very considerable expense—a daunting prospect, to say the least, to a business man who must decide whether to risk all the time and money involved. I cannot believe that this procedure is necessary in this case. It surely cannot be the case 1337 that any objection must inevitably lead to these costly and prolonged procedures. But, if it is necessary, will the Minister step in to speed up the processes if I send him the details of this case?
Related to planning is the situation which has developed regarding housing in these areas. If industry is to come in it must be able to count on a certain availability of housing accommodation. Some excellent results have flowed from the provision of house improvement grants stemming from the 1959 Act and subsequent statutes and regulations. The intention—realised in many cases—was to enable local residents to purchase and bring up to standard houses which otherwise might fall into irredeemable disrepair.
But what has happened in areas like the Lleyn Peninsula? Many of the applications have been, and continue to be, from people who ordinarily live outside the area and who have devoted these substantial grants to creating holiday homes for themselves. The result is a large number of empty houses occupied for only a few weeks of the year. The conditions of grant are so indefinite that poor local authorities like the Lleyn Rural District Council feel obliged to make these grants, the standard grants, but have no effective remedy when they are misused. No question of legislation is involved; merely a clarification of the conditions of grant, so that local authorities in such areas can reject or recover grant in cases of partial occupation.
The restriction of building zones in such areas in the interests of amenity, and the proliferation of holiday homes through a misuse of grant, have the effect of forcing up the price of land for both industry and houses. As a result, the Lleyn R.D.C. finds it impossible to build houses at a rent which people can afford. At its meeting last week I see that a rent of £6 a week was mentioned as being inevitable. In a low-wage area this is out of the question. Wages are hardly double the rent which is notionally set for any new houses built in Lleyn. About £12 to £14 a week is the average wage in this rural area as in so many others. I understand that the Minister's officials will be meeting the Lleyn Council soon to discuss these matters. I hope that they will go deep into the whole question of land use for industry and housing in the area.
1338 In the Welsh Grand Committee, on 28th April, the Secretary of State said at column 10 that he accepted the conclusion of the Welsh Council that industrial development should be concentrated in "carefully selected locations". I do not know how "carefully selected" the suggested growth points were, as there were two glaring omissions—Blaenau Ffestiniog and Pwllheli.
The Secretary of State has now made good the omission of the former, but I am sure that it must be apparent to the Minister of State and his advisers that Pwllheli, the heart and centre of the entire peninsula, indeed, the second county town of Caernarvonshire, should be added to Portmadoc in defining the general growth area. Incidentally, I agree entirely with the views expressed by the Minister of State and his right hon. and learned Friend about the need not unduly to pinpoint single towns for growth but, rather, to develop general areas where there is a problem in a largely rural community.
The Secretary of State said also:
I recognise that as these small towns expand they run into financial problems connected with the provision of essential services. These involve expenditure on the rates which are not recouped by additional rateable values until development takes place some years later. I am considering what additional assistance I can give to the growth towns in this repect. I hope to discuss these problems of Mid-Wales and our policies in the area with the Mid-Wales Industrial Development Association.…"—[OFFICIAL REPORT, Welsh Grand Committee, 28th April, 1971; c. 13]Those financial problems apply with equal force in small towns outside Mid-Wales. I should like an assurance that they will not be left out of consideration when the Secretary of State considers what he then described as "additional assistance" for such localities in Mid-Wales. To leave them out would be inequitable; indeed, it would be unacceptable to local authorities generally in Wales.The Minister of State, like myself, represents a rural constituency, and I know that he understands the peculiar problems which we face in such constituencies. Also, he has his home, as I do, in rural Wales. I hope, therefore, that he will give to the points which I have raised his best attention and endeavour to assist us in South Caernarvonshire to build a safer and a more durable economy for our people.
§ 11.48 p.m.
§ The Minister of State, Welsh Office (Mr. David Gibson-Watt)I am glad of the opportunity to discuss the problems of South Caernarvonshire which have been raised by the right hon. Member for Caernarvon (Mr. Goronwy Roberts) in his very balanced and thoughtful speech. In a few minutes, he has given the House a clear picture of the situation facing the area in a number of respects, and I shall do my best in the time available to reply on the matters which he has raised. I shall, of course, convey the points which the right hon. Gentleman has made to my right hon. and learned Friend the Secretary of State, who will pay careful attention to the debate.
I note that the right hon. Gentleman will write to me about the advance factory of 26,000 square feet in Caernarvon, and I look forward to receiving his letter. I shall read it with interest and look into the matters which he has raised.
The right hon. Gentleman asked that the planning processes be speeded up. This is a complicated question, as he well knows, but, here again, if there are particular cases which the right hon. Gentleman, as the Member for Parliament for Caernarvon, wishes to bring to my right hon. and learned Friend and myself, we shall certainly look into them to see whether there has been unreasonable delay in any respect.
One of the most difficult problems facing an area such as South Caernarvonshire—and the right hon. Member will, I know, share my view since he once held the Ministerial office which I am now honoured to hold—is how best to provide diverse and lasting employment without at the same time destroying the natural beauty of this part of Wales. It is often the case that the areas faced with the most intractable unemployment problems are those rural areas possessing the greatest attractions for tourists and which are of greatest concern to conservationists. The right hon. Gentleman has made this point on more than one occasion.
There are invariably conflicts whenever the environment and the quality of life have to be considered and weighed against industrial or other development. 1340 It is the old story of amenities versus jobs. The Government are in no doubt that on occasions the quality of life must come first, and two recent examples are Cublington and Pembrey.
Employment needs to be considered, too, particularly in places such as Caernarvonshire where unemployment has been a serious problem for a considerable time. While the Welsh Office has given no specific guidance to local authorities as to what weight they should attach to amenity and environmental considerations, on the one hand, and employment needs, on the other, this is a matter which is frequently discussed between us in the Welsh Office and the authorities.
As the right hon. Gentleman knows, the planning authorities are required to have regard to all relevant factors in dealing with planning applications. I can assure him that in so far as my hon. and learned Friend is concerned—and he is concerned—the employment factor will not be overlooked.
The right hon. Gentleman has drawn attention again to the current high level of unemployment in his constituency. The figures are disturbingly high and, though they are likely to decline over the next few months because of seasonal factors, the situation is nevertheless serious.
The right hon. Gentleman referred to the possibility of granting special development area status for the area. He also referred to it yesterday in the House at Question Time. This suggestion was, of course, put forward by the Welsh Council in its recent report on "An Economic Strategy for North West Wales".
In reply to these arguments I can only repeat what my colleagues in the Government have previously stated: the situation in South Caernarvonshire, as indeed in other parts of Wales, was looked at most carefully in the Government's recent review of regional policy. The fact is, though, that despite the firm I.D.C. policy which is still being pursued, the amount of mobile industry is still very limited. This being so, the Government felt it right after their recent review to extend special development area status only to those older industrial parts of the country where the absolute 1341 numbers out of work as well as the rate of unemployment are high.
But the fact that South Caernarvon-shire does not have S.D.A. status should not be allowed to obscure the fact that the inducements available there are still substantial. They are and I am sure that the measures taken by my right hon. Friend the Chancellor of the Exchequer in his Budget, combined with the efforts of the Government to tackle wage-cost inflation, will create a better climate for investment generally.
The Welsh Council's Report also recommended that efforts to attract new industry to North West Wales should be concentrated primarily on selected locations, among them Portmadoc and Penrhyndeudraeth. My right hon. Friend has already indicated to the council that he is broadly in agreement with this strategy. But this does not mean that other places in the area will be neglected.
Though it is not in the right hon. Gentleman's constituency, he has mentioned, as I do, Blaenau Ffestiniog as a case in point. Though not on the council's list of selected locations, the Government intends to go on encouraging firms to move there.
My right hon. and learned Friend has also informed the Welsh Council that it is now for the county councils, as planning authorities, to take account of these strategic considerations in discharging their planning functions. I am, of course, aware of the considerable support there is in the area for the Central Electricity Generating Board to build a nuclear power station at Edern. Representatives of the North Wales trade unions came to see me at Cardiff not long ago and this was one of the points which they mentioned. I know that the generating board is also aware of this. Such a project would certainly provide employment. But it is also true that the proposal would he strongly opposed by certain parties.
This is clearly the sort of potential case which throws up the environment versus employment issue most acutely. It would be improper for me to comment any further at present—there is no specific proposal and in any case major planning considerations would be involved which would need to be settled by my right hon. and learned Friend.
There is also the question of the Central Electricity Generating Board under- 1342 taking surveys of certain sites in North West Wales to ascertain their suitability as locations for pumped storage schemes along the lines of the one at Tanygrisiau. I understand that the present position is that the technical feasibility studies of the sites are still in hand. I could not in any case comment on the merits of such proposals because my right hon. and learned Friend would be involved in settling the planning issues.
The right hon. Gentleman referred to the vacant factory at Penygroes. The Department of Trade and Industry's Office for Wales is already doing everything it possibly can to find another occupant. These efforts will continue until they are successful. It is my sincere hope that the premises will in due course be taken by a firm which will provide the continuity of employment so badly needed in Caernarvonshire. It is a great tragedy for the whole area that the last tenant did not provide the permanent employment which was promised.
The right hon. Gentleman might well have referred to a planning application for a factory development of 10,000 square feet at Caernarvon Road, Criccieth.
§ Mr. Goronwy RobertsI am obliged to the Minister of State. I did not identify the factory, but the one which was involved in planning procedures was the one to which he has referred.
§ Mr. Gibson-WattI am grateful to the right hon. Gentleman for helping me out of my difficulty. The position is that this application has been referred to my right hon. and learned Friend by Caernarvonshire County Council, since it is deemed to be substantially out of accord with the provisions of the county development plan. This is, of course, in line with normal procedures. The next step will be for one of the technical officers of the Welsh Office to visit the site and to prepare a report on it so that a decision can be taken on how the application should be dealt with. I am grateful to the right hon. Member for raising this case. While it would be quite wrong for me to comment on the merits at this stage, I can assure him that it will be dealt with as expeditiously as possible.
Housing presents serious problems in this area as elsewhere. Discussions are 1343 at present going on between the Department of the Environment and the Welsh Office, on the one hand, and local authority associations, on the other, on the whole question of housing finance. But, whatever the outcome, it is perfectly obvious that local authorities must continue to build houses where there is a programme of industrial development. Without an adequate supply of suitable housing it will be extremely difficult to attract key workers to any area to train local labour.
And there is no reason why any local authority should be deterred on financial grounds from building houses which are badly needed. Under the Government's proposals the rents of local authority houses will be determined in accordance with the principle of "fair rent"—a principle first introduced in the Rent Act, 1965.
The right hon. Gentleman referred specifically to the problems facing Lleyn Rural District Council. I am aware of some of the difficulties—which may be 1344 more apparent than real—and I am sure that there is scope for a detailed discussion of the problems between the local authority and the Welsh Office. I have therefore arranged for officials from the Office to meet the local authority within the next two weeks or so. I hope that as a result of that meeting the council will feel able to proceed to meet the real housing needs of the area.
I am very grateful to the right hon. Gentleman for giving me the opportunity of replying to the debate. He has dealt with these matters with the sympathy and feeling of somebody who not only represents such a constituency but also lives in it. He rightly feels deeply about the problems which his constituents face. I can only asssure the right hon. Gentleman that we fully recognise the difficulties which he and his constituents are facing and will do all that we can to help him and them in solving them.
§ Question put and agreed to.
§ Adjourned accordingly at one minute past Twelve o'clock.