HC Deb 17 May 1971 vol 817 cc1041-50

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

11.20 p.m.

Mr. Lewis Carter-Jones (Eccles)

No doubt the Chichester Harbour Bill is vitally important for certain people, but I consider the problem of unemployment in Manchester to be even more important to the ordinary people. My hon. Friends and some hon. Members opposite are concerned about the seeming indifference of the Government's attitude towards unemployment in our area. We are concerned that the Government seem to be returning to a policy of laissez faire, to which my hon. Friends, and particularly those who represent Manchester, are completely opposed.

There is deep concern, disquiet and a sense of insecurity because, whether they intend it or not, the Government seem to be deliberately creating and then sustaining a climate of despair. I was in my constituency last week and I want to mention the comments of three different people. The first I overheard in a barber's shop. A man was talking about the Secretary of State for Trade and Industry and his comment on the motor industry. This man asked: Are the Government really determined to increase the pool of unemployment? If they are they going the right way about it, particularly in Manchester. The second person was a well-respected employer who said that he was concerned about the underlying trend of economic activity in the area. He said: We are not employing our resources to the full. The third quotation comes from a councillor in my area, who is an efficient, skilful electrical worker, who is out of work. He uttered what I thought were the saddest words I have heard for a long time when he said: It makes you afraid of growing old. It is rather sad to find people who spend a large part of their working lives in dedicated service to their country faced with unemployment in early middle age.

This area was in the forefront of the Industrial Revolution. Already there has been a rundown in our three major industries of coal, cotton and now steel. I am glad to see my hon. Friend the Member for Salford, West (Mr. Orme) in his place. He worked at Trafford Park and will share my anxieties at the lack of job opportunities in heavy engineering at Trafford Park.

I have been assured in two letters from the Government that they cannot really help. The Minister of State at the Department of Employment said, when I wrote about the employment of older, highly skilled people: I can assure you that our local officers are alive to the problem of the older age groups and will continue to do everything possible to help them in their search for employment. It is the word "search" that I want to stress. The fact that they are searching can be directly attributed to some of the acts of this Government.

Secondly, I had a letter from the Department of Trade and Industry dealing with the closure of the Openshaw Works, the final paragraph of which said: The Government Departments in the Regions will do everything they can to help mitigate the effects of the closure, but other than that it is not a situation in which the Government can intervene. The Government must bear the responsibility for much of the anxiety in the Manchester area.

Let me illustrate in two ways. Openshaw has faced unemployment. At Irlam steel works the employment of 4,000 people is affected. If this cut-back has taken place, and if the Government were to wash their hands of responsibility, they ought not to have interfered in the capital investment programme of the British Steel Corporation. They cannot have it both ways. They cannot, on the one hand, say, "We are not responsible", and wash their hands of it, and then take action which creates a situation of difficulty. I can assure the hon. Gentleman that the people of Openshaw and the steel works of Irlam are desperately anxious about this situation now. They are not lazy layabouts. They are people who want to work, and they feel that the Government's decision to interfere in the capital development programme of British Steel Corporation has affected their job prospects.

There were great prospects of employment at Shell Carrington and the factory there. Again, it is action by the present Government which has caused a cut-back, because of the changing from cash grants to investment allowances, and so the whole of this process of development has been put in jeopardy. The fact that the activity at Shell Carrington is in jeopardy is due entirely to the policy of this Government. They cannot, on the one hand, write to me two separate letters and say they are not responsible when two cases I have quoted reveal that they, and they only, are responsible for the situation.

Mr. Stanley Orme (Salford, West)

What is so disturbing about what is happening at Shell Carrington is that it is that type of industry we want in the Greater Manchester area. We want modern, science-based, technological industry because of the decline in heavy engineering. We need that type of development or we shall have an increase in unemployment. Would not my hon. Friend agree?

Mr. Carter-Jones

That was percipient of my hon. Friend. He has anticipated my next remarks.

We all of us have read with considerable interest the representations we have had from the North-West Industrial Development Association, which has pinpointed the problem. We live in an area which is old in industrial development but is suffering from the obsolescence of industry and the difficulties of our environment. We need to improve the environment and we shall require a considerable amount of help from the Government, and I hope that the hon. Gentleman can at least give us some hope of some improvement, because the feeling of our constituents at present is one of black despair. If the hon. Gentleman can give us some hope tonight, at least this debate at this late hour will have been worth while.

My hon. Friend just now anticipated my next point, which is to emphasise the lack of growth industries which we need to replace the sadly declining sectors of the older industries, which seem to be in need of rejuvenation and replacement. I wish to quote what was said by the deputation from S.E.L.N.E.C. which went to the Minister of Technology on 24th September. It states that at present industry is being discouraged from moving to some parts of the conurbation through the restriction of the granting of industrial development certificates and there is some evidence that even the expansion or renewal of existing firms is also discouraged because of I.D.C. difficulties. This policy seems to be based simply on the fact that unemployment percentages are not shown as high. There is a clear case for the Department to be more generous in granting industrial development certificates in this area.

Mr. Charles R. Morris (Manchester, Openshaw)

I have been impressed by the logic of my hon. Friend's argument. Is he aware that, in view of the real concern and despondency in the City of Manchester about the problem of increasing unemployment and the diminishing job opportunities available for the unemployed people in Manchester, he will have the support of all reasonable people in Manchester in his demand, and the demand of the S.E.L.N.E.C. local authorities, for more industrial development certificates to allow firms to expand and develop in the area?

Mr. Carter-Jones

I agree completely. However, I was hoping that a request for more industrial development certificates would be my minimum request.

I turn to the possibilities of having our area treated more favourably not only from an I.D.C. point of view but as an intermediate area to stimulate the prospects of employment and expansion. The trouble is that employment in our area is frequently masked because large numbers of people tend to go to the South-East. The attractions of the South-East are very pleasant for people of an area which has not had as much capital injected into it as it should have had. In this connection we should consider the situation regarding industrial premises built before 1914 in the Manchester area. Sixty per cent. of the industrial premises in Salford were built before 1914. Ninety per cent. of them were built before 1939. This highlights the situation. Salford is in many ways typical of the area. Only vast injections of capital into the area can help.

To sum up, I wish to quote the recommendations of the North-West Industrial Development Association to the Minister when its representatives called to see him. They made five points. First, there is a tremendous need for a drastic improvement in the investment of social and industrial capital in the region. Many of our schools are out of date. We have a large number of old properties. There is a great need to increase school building and road building and to stimulate industrial development.

Secondly, at the meeting with the Minister the association pointed out by that industrial building grants of at least 35 per cent. should be made available throughout our region. This would be a positive injection of capital into our area.

Thirdly, because of the past ravages of the Industrial Revolution, there is need for some of the old dereliction caused by past industrial activities to be swept away. This will require not less than a 100 per cent. grant. This sort of task cannot possibly be faced by a local authority tackling housing problems and other social and welfare problems. The Government must be very generous if they mean to sustain their argument about creating a better environment. We are the people who need their support.

Fourthly, industrial development certificates must be made more readily available for factory building in all parts of the North-West, including Manchester and district.

Finally, I urge the Minister to consider giving intermediate area status to the remainder of our region outside the present development areas. What worries us is that the growth in our area seems to be in unemployment, in squalor and in despair. Will the hon. Gentleman tonight give us some hope of growth in the economic sector?

11.35 p.m.

The Under-Secretary of State for Trade and Industry (Mr. Anthony Grant)

I have listened with interest to the exposition of the hon. Member for Eccles (Mr. Carter-Jones), and although he will not expect me to agree with everything he said, he argued his case forcibly. I would be inclined to agree with what he said about a growth in squalor and unemployment, but it started many years before June of last year. If he accepts that, we are at one.

I am particularly glad to have this opportunity of speaking tonight on the subject of unemployment in the Manchester district because I know that the hon. Member's concern about the position there is shared by several other hon. Members whose constituencies lie in and around Manchester. I need hardly assure hon. Members that Ministers, certainly myself, are well seized of the features that currently characterise the Manchester travel-to-work area. We fully recognise that the area has felt the impact of redundancies, closures, and general unemployment during the past 12 months; and I know that closures and cut-backs have resulted in major redundancies in a variety of industries.

Notwithstanding the admitted problems of obsolescence in Manchester, I fully appreciate that the heavy loss of jobs in Trafford Park—12,000 during the past 4 years, largely due to G.E.C.-A.E.I. merger reorganisatoin—together with other major redundancies, and the recently announced B.S.C. closure at Irlam cause particular anxiety.

Mr. Orme

What worries us is that Trafford Park is becoming a vast warehouse for storing stuff rather than a place for people to work.

Mr. Grant

I will have another word about Trafford Park in a moment if I have time.

Job losses have a direct impact on individual lives and the well-being of a community. However, the closures that have taken place in industries generally have been necessitated by the urgent need to rationalise production, and in some instances, for example, the aircraft industry, by a recession in world markets. Unfortunately, the necessity for rationalisation in many instances reflects the cost inflation which has been widespread throughout our economy, and is therefore not confined to the Manchester area. The previous Government said that there would be need for rationalisation.

Regarding the B.S.C. closure at Irlam, I fully recognise the effect that this will have. However, it must be emphasised that closure of the Irlam plant will be in two stages, and that the second stage involving 2,392 workers is not planned to take place until 1973. No timing for the first stage, involving 1,961 workers, has been announced so that further discussion can take place with the trade unions. Furthermore, it should also be remembered that figures announced in connection with the steel closures relate to job losses. Actual redundancies are likely to be less, and will be spread over a period. There will also be natural wastage, and B.S.C. intends redeploying men wherever possible. The immediate effect on unemployment in the areas concerned will not perhaps be so serious as it appears at first sight, and I need hardly add that the full resources of the Department of Employment will be available to help those who will in due course have to seek other jobs. I mention this not to minimise the difficulties, but to tell people to cheer up a little bit and not to get too depressed.

On the question of unemployment, it is true that the percentage rate for total registered unemployed in Manchester has risen this year from 2.3 per cent. in January to 3 per cent. in April; and the corresponding male percentage rate has risen from 3.5 per cent to 4.4 per cent. But I must point out that the current rate for Manchester is below that of the national average, 3.4 per cent., and well below that for the North-West Region of 3.8 per cent. So Manchester is not so badly off. Manchester must look at the situation in the light of the whole of the area and the whole of the country.

What I find of greater significance, however, is that the trend for both the total and male percentage rates has risen steadily since April, 1966—which is hardly a tribute to the previous four years of the Labour Administration.

A word about industrial development certificates. There appears to be considerable misunderstanding about the Government's policy in this field. We have repeatedly declared our belief that the needs of the assisted areas must remain paramount in regard to the siting of industry involving substantial numbers of new jobs. Within the requirements of this policy, however, my Department views as sympathetically as possible applications for rehousing and modernisation schemes, and normal expansion although it is sometimes necessary to look critically at applications in the Manchester area, where unemployment rates have been generally below the national average. But, as I said in my letter to the hon. Member for Preston, South (Mr. Green) in recognition of the problems of the Trafford Park Industrial Estate, the I.D.C. control will continue to be used with a sensitivity to local needs. No application has in fact been refused there in recent years.

This indicates the point that while the Government regard the I.D.C. weapon as an essential feature in the armoury of regional policy, nevertheless we intend to operate it as flexibly as possible.

Mr. Charles R. Morris

What about intermediate area status?

Mr. Grant

I am coming to that point now. As hon. Members are aware the Government have carefully reviewed the coverage of the development and intermediate areas. Whilst we recognise the problems caused in parts of the North West, including Manchester, by the rundown of older industries, rationalisation and closures, the fact remains that other areas have much greater problems of heavy and persistent unemployment.

I know that the area was disappointed with the previous Administration for not giving it intermediate area status, but our review has not indicated that we have to take a different view from that of the previous Administration for these reasons. Because the supply of mobile industry is limited at present it is our view that priority must be given to the areas of greatest employment need, for example, in West Scotland, 57,000 6.2 per cent.; Tyneside and Wearside 34,000, 5.9 per cent. It must be right to give priority to such areas. Whilst the Government do not intend to make frequent change in the boundaries of assisted areas, the situation will be kept under constant review so that areas no longer in need of assistance no longer benefit at the expense of those which do.

What industry needs more than anything is a period of stability, where it can know exactly what the plans are for assisted areas, rather than to have a situation that is chopping and changing all the time. We have undertaken to keep this coverage under constant review.

Mr. Carter-Jones

Would the hon. Gentleman answer the question about this particular area. It is the underlying trend in this area that is causing anxiety. Unless action is taken quickly, we will have an acceleration of this rate and will end up as a severely depressed area.

Mr. Grant

I understand that. That is precisely why I said that we shall keep the position under constant review. But I cannot accept that the figures or the underlying trends at the moment justify a change of status. But we shall keep it under constant review for that very reason.

As to the future, I do not share the pessimistic views which have been expressed in the House tonight. Certainly, the current unemployment situation gives no cause for complacency, but the position must be seen in perspective. The fact remains that, despite heavy job losses during the last few years, the unemployment figures for the area have demonstrated Manchester's considerable resilience in absorbing these problems, compared with some other areas. Manchester's industries are well diversified, and I know that retirement and migration outwards to some extent have eased some of the difficulties. There is, too, extensive travelling to work throughout the area, greatly assisted by good communications, and this fact alone should assist with the problems of Irlam as well.

Whilst the questions of obsolescence and slum clearance are the responsibility of my right hon. Friend the Secretary of State for the Environment, I think it right to emphasise that the Government are giving high priority to tackling these problems, and every encouragement is given to local authorities to avail themselves of Government grants for derelict land clearance. As hon. Members will know, my right hon. Friend the Secretary of State for the Environment visited the North-West Region on 7th May, and met representatives of all the local authorities, including Manchester, in order to consider their problems at first hand.

Mr. Gerald Kaufman (Manchester, Ardwick)

The right hon. Gentleman had better come again. They are different.

Mr. Grant

If they have changed in the last few days, undoubtedly we shall come again. However, that is not my evidence.

It is the Government's firm view that the Manchester district, in common with other areas of the country, should benefit from our policies to restore stable growth to the national economy. The district has a wide diversification of industry and commerce, and a tradition of enterprise and sturdy self-help which will enable it to seize and develop the opportunities which will arise in the new atmosphere of business confidence which we are seeking to generate. Hon. Members opposite do no good by spreading tales of woe and misery. They do nothing to help their own constituents.

We have heard a reference to one hon. Member's conversations in a barber's shop. I much prefer to study the April newsletter issued by the North-West Industrial Development Association. This indicated that industry had welcomed the Budget proposals together with the cut in the Bank Rate and the continued strength of the balance of payments. This, it felt, would all help business confidence. At the same time it rightly pointed out that the impact of the measures would take time to work through the economy, and this is the thought I would commend to hon. Members, who cannot expect miracles to be wrought overnight.

Mr. Kaufman

At a stroke.

Mr. Grant

I am glad that the hon. Member for Eccles raised this subject tonight. He has enabled me to make two points: that the problems of Manchester did not start in June of last year, as the hon. Gentleman seemed to imply, but a very long time ago; and, secondly, that the problems are by no means as bad as those of some other parts of the country.

Mr. Charles R. Morris

Will the Minister come to Manchester to see the position for himself?

Mr. Grant

I shall be only too delighted to accept the hon. Gentleman's invitation. But my right hon. Friend the Secretary of State—

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

Adjourned at ten minutes to Twelve o'clock.