HC Deb 02 November 1971 vol 825 cc153-64

9.58 p.m.

Mr. Ted Leadbitter (The Hartlepools)

Almost the first sentence of the Gracious Speech reads: … my Government's first care will he to increase employment by strengthening,the economy and promoting the sound growth of output. My constituency is in a region which now has the highest unemployment level for more than 30 years. It is estimated that the figure will be about 100,000 by the end of the year. The Hartlepools exchange area has a male unemployment rate of 12.3 per cent. This means that one in every eight men of the insured population is out of work. This compares with 8 per cent. in the Northern Region and 5.2 per cent. in the country generally. It represents a calamitous situation. What store, then, can we place on the Government's stated intention to increase employment? After 16 months in office, we are entitled to consider the meaning of their first care, for some of us wonder why it has taken the Government so long—

It being Ten o'clock, the Motion for the Adjournment of the House lapsed, without Question put.

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

Mr. Leadbitter:

—some of us wonder why it has taken the Government so long to express a care about the state of employment when the total figures registered with the Department of Employment and those registered with other agencies are estimated to show well over one million people out of work in the United Kingdom.

Every pressure from the Northern Group of Labour Members, from local authorities, from the North-Eastern Development Council and from the trade union movement has produced very little identifiable response from the Government. We have urged Ministers to review the Government's disastrous lack of a coherent policy. We have made it plain that the state of employment in the Northern Region is not just a coincidence with the Government's period in office; it is a result of their attitude, of their approach to industrial questions, of their haste in changing the established regional policies, of their obduracy in pursuit of the notion of industrial disengagement and of their naive belief that all will be well in the free market.

Within the region, Hartlepool is an outstanding example of the price we have had to pay. In the last year of the previous Tory Administration—1963— Hartlepool had the highest unemployment level in Great Britain. In the years which followed we gained 30 new industries or extensions to existing ones and more than 7,000 new jobs. In the first year of the present Government, we are back to where we were in terms of unemployment. Every northern Labour Member of Parliament can relate a similar trend of depression. Only the Government stubbornly remain blind to the realities and folly of their own actions.

On 27th July I asked the Secretary of State for Trade and Industry, how many applications he had received from firms anxious to develop in the Northern Region since the introduction of the Government's investment allowances, and I also wanted to know the figures before the termination of the investment grants. The Parliamentary Secretary replied that between November, 1970, and June, 1971, 85 industrial development certificates had been issued and that for the same period before the termination of the investment grants 121 certificates had been issued for 14,740 additional jobs. Yet the Parliamentary Secretary added that there was no evidence to suggest that the fall in industrial development certificates had been due to a change of policy.

On 27th May I was told that it was much too soon to review the effects of the Budget measures ".—[OFFICIAL REPORT, 27th May, 1971; Vol. 818, c. 210.] —that was, the effects on regional policy. Yet in a further Answer to a Question of mine a Minister at the Department of Trade and Industry had to admit that 18,000 redundancies were notified as likely to occur in the year ending July, 1971. More than 1,000 redundancies were announced in my constituency in the same period.

Where was the care? We are anxious to identify any indicator to support the care expressed by the Government in today's Gracious Speech. We are very hard pressed to find it. From the forecasts for industrial investment there seems little sign of an early improvement. The Chief Secretary to the Treasury said on 26th October:

… manufacturers are expecting capital expenditure to be somewhat lower in the current half year as a whole than in the first half of 1971. A little later, to illustrate the Government's confusion, he added: If there is a falling-off in the latter half of 1971"— that is, in industrial investment—

in order that 1971 may be the same as 1972, it indicates that there will be an increase in 1972."—[OFFICIAL REPORT, 26th October 1971; Vol. S23, c. 1460-61.] That is a piece of simple reasoning to give us a profound example of the measure of the clarity of thinking which has characterised the Government on matters involving industrial development and regional policy and the care about unemployment which they profess. It is no wonder that my constituency has suffered.

The Government do not have the stomach for a positive regional policy. They have postulated the policy of withdrawal from industrial development. They adhere to the dogma of the free market. They refuse to reconsider the effect of ending the regional employment premium, although they still have time to reconsider that sad decision. No one action by the Government can be shown to have projected the pace of improvement in the regions in any of the respects established by the Labour Government. We can be forgiven if we conclude that by their every action they have failed to recognise the nature of the regional problem, or they have deliberately decided not to recognise it.

But surely the Government must take note now of the damage done in my area. The present position in Hartlepools is that 3,083 males are out of work while there are only 45 vacancies registered and there are 69 men or boys for every recorded vacancy. That is a disgraceful, intolerable and unacceptable state of affairs. There are 580 females registered as unemployed and only 30 vacancies recorded. The figures include 208 boys and 154 girls of whom 63 boys and 42 girls are still looking for their first jobs; six vacancies are recorded. In the same period last year only 17 boys and 17 girls were looking for their first jobs, and this was only shortly after the Labour Government had been taken out of office, so that this was due to Labour policies. The situation for these young people is, to say the least, demoralising.

I turn to the long-term effects, the figures for the people out of work for more than 26 weeks. In the period 1950 to 1971 the highest figures for long-term unemployment were to be found in 1963, the last year of a Tory Administration, and this year, under another Tory Administration. The figures are respectively 1,113 and 983. This means that 27 per cent. of the unemployed in my constituency have been out of work for more than half a year and 2,617, or 74 per cent. of the wholly unemployed, have been out of work for more than eight weeks. Does not this strike the Minister of State, as it strikes all of us, as a shameful misuse of our resources? When a country pays so many to be idle so long rather than provide them with work, it has lost its sense of direction and purpose.

Since October last year, 1,485 more people have been registered as out of work at Hartlepool and more than 1,000 redundancies have been announced in the steel industry alone—and more are to come. The rate of increase among the unemployed from April of this year—9.9 per cent. to 12.3 per cent. among men and 7.6 per cent. to 9.3 per cent. overall, male and female, boys and girls—is a frightening situation and it has to be stopped.

There must be a change in Government policy. It is time for them to admit that past postures and policies have been harmful in my region. Delay in changing course cannot be justified. The Government would commit an act of inescapable irresponsibility if they remained deaf to the proposals available to them. I put it to the Minister that regional recommendations are bound to help towns like the Hartlepools—and there is quite a number of them.

The Government must restore investment grants, announce a new advance factory programme and change their minds on the regional employment premium. They must sponsor new industries and take positive steps to increase expenditure on research and development. A council on Science and Technology should be set up. A new university is needed, for employment comes naturally once one cultivates the abilities of people, in whatever area they live. The skills are a paramount need in the Northern Region, certainly in my area.

More industrial training must be promoted and a positive policy implemented for the location of Government offices in areas like mine. The Government must realise that industrial investment in the regions is in the national interest and the capacity of our own industries to meet domestic demand must be encouraged.

For instance, can the Minister tell nee the sense in employing Italian steel workers to produce steel pipes for the Gas Council, when our own steel workers are capable of making those pipes but are made redundant? Can he justify it when a steel pipe mill in my constituency, with these levels of unemployment and the nature of the problem that I have described, is to be closed down? Will he explain how it is that the British Steel Corporation and the Gas Council give me two different answers to this question? How is it that, on the discovery of North Sea gas, the Gas Council and the B.S.C. failed to work out a programme of steel pipe production employing our own men and our own plant?

The Minister knows that, in Hartlepool, we have under construction the only nuclear power station in the world sited in a populated area. This multimillion pound project is a source of employment for those working in steel and in the electrical and civil engineering industries. I understand that manufacturers in this country are disturbed because of the lack of C.E.G.B. orders and more disturbed when they learn that orders for the Hartlepool station are being considered for European suppliers.

If my information is correct, it appears that components acquired for the generating plant are being obtained from Europe and not from our suppliers employing our own workers. Whatever the position, either inquiries or commitments, this matter must be cleared up.

I should like to make it clear also that when Hartlepool nuclear power station was agreed, a maximum work force at peak production of 2,400 people was estimated and an undertaking was given to employ as much local labour

as possible. I do not accept that that undertaking has been honoured. Much more could have been done.

In conclusion, there was not one of my colleagues in the Northern Region who was prepared to go before the Labour Government, or who is prepared to go before a Conservative Government, in a cap-in-hand or a begging bowl posture. We are not going to talk about our area as being fundamentally different from any other. What we are saying is that we want this Government to recognise that it is in the nation's interests that the resources of this country should be fully employed, and that we have in the Northern Region remarkable capacities to meet changing economic conditions. We want the Minister to realise—he has northern roots himself—that a fundamental right of a man is to work, and for men to be placed out of work as a result of some economic consideration is, in my view, a prostitution of all decent reasoning.

We say that this Government will not last too long. Common Market or not, the Government will not last too long. If they continue to show a hard face to my people, the Government will not last too long. In what I am saying to the Minister tonight, I am not arguing only for my town of Hartlepool but, I believe, on behalf of my colleagues, and we are only asking for no more than he would accept himself—the right to be in work, so that a man can hold his head high wherever he lives and so that he can care for his wife and family. We talk about a decent society, about which we pass so many resolutions, ofttimes avoiding practical answers, but I hope that the Minister will satisfy my colleagues and me that the Government are now prepared to change course and do something much better. If he can, we can forget the past 16 months.

10.16 p.m.

The Under-Secretary of State for Trade and Industry (Mr. Nicholas Ridley)

I am glad that the hon. Gentleman the Member for The Hartlepools (Mr. Leadbitter) has raised this subject. I ;hare entirely his concern, and that of other hon. Gentlemen who represent seats in difficult parts of the country, at the nigh level of unemployment and the resulting human hardship which this causes. I must tell him, however, that I do not find myself able to share his partisan and, I thought, unfair approach to the causes and to the possible cures of this extremely distressing and unhappy situation. I would acknowledge that there are few places where the situation is more serious than it is in the town of Hartlepool, and I entirely applaud his attempts to put it right. The situation certainly is serious. My hon. Friend the Under-Secretary of State visited Hartlepool and saw the conditions for himself and talked to the people living there about the situation, and I myself, as the hon. Gentleman said, know Hartlepool well and have frequently visited it.

Hartlepool has an unemployment rate of 9.3 per cent. and a 12.3 per cent. male unemployment rate. It is nothing which any hon. Member could be pleased about, or feel complacent about, and I can tell the hon. Member flatly that the Government share this concern and are not at all satisfied with the position.

There is also, as the hon. Member said, a worrying position among the young. Among school leavers there are still 63 boys and 42 girls who left school at the end of the summer who are unemployed, and that number, of 105, represents 12 per cent. of the school leaving population. That is, perhaps, a more worrying situation even than the rate of adult male unemployment, because it is more soul- destroying for there to be no prospects for the young than for the old to find life difficult.

The hon. Gentleman made a great point of the figures showing an improvement during the years when the Labour Government were in office. Although superficially that is true, it is too facile and not fair to make that sort of political capital. The year he quoted, 1963, was a peak year of unemployment because of the cruel, hard and long winter, and was in no sense a good year to take as an average for the last Tory Government's administration. In all these matters there is a great element of time lag, and the best years for Hartlepool were 1964, 1965 and 1966 when there was a lower rate of unemployment than at any time since the war. In one year it went down to under 4 per cent., which is the best figure there has been. To claim credit for this is stupid and wrong, because these jobs and the level of activity were the result of the regional policies of the previous Government. My noble friend the Lord Chancellor started a development campaign in the North of England which resulted in a great improvement.

I do not want to fall into the trap of saying that under one Government unemployment has been higher or lower in this town, because one cannot spell out the unemployment figures during any Government's administration and say they are due to Socialism or Conservatism. That is far too crude an approach. I will tell the hon. Gentleman later why it does not apply here.

The hon. Gentleman said that the prospects for Hartlepool look extremely bad. I will not allow him to put a gloomy interpretation upon the figures. When we are dealing with the past we are dealing with facts. We know how many jobs have been created. When we are dealing with the future we are dealing with the results of I.D.C.s granted in the past and regional policies not yet brought to fruition and producing employment. Some projects are cancelled and others take their place. We do not know what future employment lies in expansions; we do not know what future employment lies in the service industries for which I.D.C.s may not be required. It is extremely hazardous to guess the number of new jobs simply on I.D.C.s.

However, I can give the figures for what they are worth. The number of new jobs expected to arise from I.D.C.s in 1967 was 1,330; in 1968, 1,290; in 1969, 140; in 1970, 430. The figures for 1971 are not yet available. This shows that one cannot take a pattern out of the figures and blame one party or the other.

Nor do I believe that it is right for the hon. Gentleman to allege that the change from investment grants to investment allowances has had an effect of this sort. We all know that underlying the figures and the very real problems there is the greater and much more important factor of the come and go of industrial activity in the world at large, the boom-slump or the recession-inflation cycle, and that this is in fact the cause of the present difficulty and not regional policy.

I will illustrate this by saying a word about the steel industry. There is overcapacity in the world which results in intense competition, and it is the most efficient producers of steel products who get the orders. There is, therefore, a need for rationalisation; the British Steel Corporation is trying to rationalise and this, sadly, results in closures. But if one does not realise one is not competitive and will get no orders, that will perhaps result in more closures. This problem is particularly severe in the manufacture of steel pipes, and I am sorry to hear tonight that the 20-inch mill at Hartlepool is under a six months' closure notice. I hope the negotiations will be conducted during the next three months and I do not want to prejudge the results of those negotiations, but we have to acknowledge that there is a real threat to that mill.

The hon. Member mentioned the Italians and the pressure on prices. But the only way eventually to win the orders and work which results from the jobs is for the British Steel Corporation to make its production efficient and competitive so that it can grow not by selling only on the home market but by exporting and taking orders which at present may be taken by foreigners. Therefore, we have to go through this process of rationalisation.

The same is true of electricity. The Lon. Gentleman mentioned the power station at Seaton Carew and asked that further power stations be brought forward to create more work in the generating industries manufacturing for the Central Electricity Generating Board. Of course we will consider this, of course we are as sympathetic as can be, but there is no point in the Board ordering more stations than it believes it will want, because one cannot make electricity and store it. One must tailor the supply of electricity to the expected demand. The reason the Board is holding back is that it wants to be certain that the stations it commissions will find a ready market.

I come to the Government's regional policy. It is the economic forces which have worsened the position in the North- East, despite the increase in incentives and all the aids and help the Government have provided. It is totally unjustifiable and misleading to suggest that one single thing the Government have done has made it more difficult to help industry provide jobs in the development areas. When one looks at the situation in the last 15 months, increase in special development area status in Hartlepools and in other parts of the North-East, Scotland and so on, tax concessions—

Mr. T. W. Urwin (Houghton-le-Spring)

rose—

Mr. Ridley

I am afraid I cannot give way. I have not much time left. When one considers the tax concessions on a massive scale and the great increase in infrastructure expenditure, in housing expenditure, what is it this Government have done which could conceivably have made the incentives more difficult for industry to go to the regions? What single action by the Government can the hon. Gentleman mention—

Mr. Leadbitter

The hon. Gentleman asks me a question. Will he allow me to answer it?

Mr. Ridley

The hon. Gentleman took 20 minutes to say what he wanted to say, and I have very little time left in which to make my remarks. He used words like "obduracy"; he mentioned lack of care, lack of coherent regional policy, and he talked about the Government stubbornly remaining blind and so on. I can tell him that this Government has put into the economy even more than their predecessors took out of it. Our regional incentives have been increasing all the way along the line and to blame this Government for what is caused by their predecessors is hypocrisy of a disgraceful sort.

Mr. Leadbitter

Who does the Minister blame?

Mr. Ridley

As my right hon. Friend the Prime Minister said this afternoon, even the regional policy measures which we have been pursuing and which successive Governments have been pursuing, from which we have not deviated, have not proved to be the complete answer. We are now studying in depth the various alternative options open to the Government to increase still further the help which I hope will be successful and will bring to The Hartlepools, the Northern Region and the other development areas the relief from unemployment which he and I both want to see. But I ask him against the background of what I have said to choose his words more carefully.

Mr. Leadbitter

The Minister should choose his own words more carefully. He should not advise me. His reputation is known.

Question put and agreed to.

Adjourned accordingly at twenty-nine minutes past Ten o'clock.