HC Deb 09 November 1971 vol 825 cc965-76

10.12 p.m.

Mr. David Lambie (Central Ayrshire)

I am grateful for the opportunity of raising the subject of the future of Barassie railway works. I regret that the Under-Secretary of State for the Environment is not here following his accident at the weekend. I am sure that hon. Members wish me to say that we hope that it will not be long before he is with us again, and I hope that his colleague who is to reply will convey to him our best wishes for a speedy recovery to health.

Barassic workshops, employing approximately 280 people, is one of the main railway workshops left in Scotland. The other is the Glasgow St. Rollox workshops, employing about 2,190 people. This once proud traditional Scottish industry, with famous names like Cowlair's, Kilmarnock, Thornton, Inverurie and Townhill, is in danger of being eliminated by the British Rail Engineering Ltd. proposal to close the Barassie works. So far the St. Rollox workshops has not been mentioned but if past history is to be repeated it will be its turn next.

The work force at Barassie contains men who were transferred from the old workshops at Kilmarnock and Inverurie. It is the end of the road for them. On 20th September last a meeting was held between the Railways Board and British Rail Engineering Ltd. and the trade unions representing the work force in the railway workshops. The topic for discussion was the future work and manpower requirements in the railway workshops.

In wagon repairs and construction—and this includes Barassie, as it is concerned solely with wagon repairing—British Rail forecast major reductions, with a 42 per cent. reduction in the wagon fleet up to 1976, involving a loss of more than 1,000 jobs in 1972 and a total of more than 3,000 by 1976. The unions made it clear at that meeting that they could not accept this position and they proposed the setting up of a joint working party from management and labour to go into the whole matter in detail, and they challenged the basis of the proposed work load and the man-power requirements.

Two meetings of the working party have been held and the next is due on Thursday, 18th November, when, I am informed, final decisions will be taken and when British Rail wants to reach some conclusions. This Adjournment debate is so important tonight because one of the final decisions of British Rail will be completely to close the workshops at Barassie in my constituency. Six months from Thursday, 18th November, will be the day when this closure will come into effect, unless the Government take action to stop it.

The Under-Secretary may ask why I ask the Government to intervene to prevent Barassie from closing. He may say that the Government have no power to intervene in the policy decisions of British Rail and no power to subsidise British Rail's workshop activities. However, coming from Scotland I find it hard to understand that, as last night I read in the London newspapers that the Government were prepared to subsidise British Rail to the tune of £14 million in order to bring more commuters into the centre of London.

I have already had a letter from the Secretary of State for Scotland about Government action. Writing on 25th October, 1971, he said: I am naturally very concerned that the possibility of closure at Barassie has been mentioned, but neither I nor the Minister for Transport Industries has the power to intervene. Nor do the Government have any power to subsidise British Rail in respect of its workshop activities. The Secretary of State told me that this matter was the sole responsibility of the British Railways Board.

Following that letter I got in touch with the British Railways Board and spoke to Dick Marsh, the Chairman of British Rail. Following my conversation with him, Dick Marsh sent me a letter saying that it was the responsibility of the Government to keep Barassie open. He said: You explained to me that you were primarily concerned with the social consequences of closure. I must make it clear that while we clearly have an obligation to minimise the social consequences of our actions, we cannot maintain any activity on purely social grounds. The responsibility for regional policy must lie with Ministers. If me were to retain uneconomic activities on social grounds, this could only mean even larger redundancies elsewhere unless we were compensated for it. Dick Marsh has thrown the ball back into the Government's court.

There are serious social problems in the threatened closure of Barassie works. Troon, where the works are situated, has only one other industry, Troon shipyard. The present unemployment rate for the Ayr area as a whole, including Troon, is just under 5 per cent., but that would be doubled to 10 per cent. if the Barassie works were closed.

The position is even worse than that. The Glasgow and West Central area already has exceptionally high unemployment. In Ayrshire, it has already topped the 8,000 mark, and in the corridor from Kilmarnock to Saltcoats, where nearly half the work force employed in Barassie live, unemployment is over 8 per cent., with male unemployment standing at over 10 per cent. What is more, this is a so-called growth area. In fact, it is like many of the growth areas in Scotland, rapidly becoming a ghost area, with further major redundancies threatened in other industries.

I accept Dick Marsh's opinion that responsibility for regional policy must lie with the Government. This is why I call upon the Government tonight for an assurance that they will take action with British Rail to prevent the closure not only of the Barassie railway workshops but of the other threatened workshops elsewhere in the United Kingdom.

The Government should provide British Rail with sufficient capital to allow it to modernise its existing fleet. I am told that British Rail is at present short of capital. I understand that it has gone to Germany to try to obtain working capital. At this moment, Dick Marsh is either about to go to the United States or is already there, again, I understand, to look for extra capital to keep British Rail going.

If British Rail had the extra capital to allow it to modernise its existing fleet, this would allow the workshops which do construction work to share some of the wagon repair work with Barassie. Unfortunately, in Barassie we do no construction work; it is all wagon repairs. If the workload of the railway workshops on the construction side were extended, some of the surplus wagon repair work could go to workshops such as Barassie.

If the Government believe their own statement that the economy is on the upsurge, British Rail's policy of cutting back is nonsense. I see that the Under-Secretary of State for Development is on the Front Bench. I remind him that if the great Oceanspan scheme is to come about, there must be a good railway and railway workshop basis in Scotland to serve the increase in transport from the Clyde to the Forth.

The Secretary of State for Scotland has promised that we shall have the great developments at Hunterston. He has thrown his political reputation into the ring on the understanding that we shall have Hunterston. It is criminal for British Rail now, with Government connivance, to be thinking of closing the nearest railway workshop when we all know that those tremendous developments must come to Hunterston. On that basis alone, and if the upsurge in the economy is coming, the Government should be prepared to give British Rail the capital necessary to keep going.

There is a temporary measure which the Government could take. They are prepared to offer credit facilities to British Rail so that it may obtain a contract from the Yugoslav State railways. We are told by the trade unions that British Rail says that the Government have put no barriers in the way preventing it from obtaining adequate credit facilities to enable it to compete with the Germans for the Yugoslav order. At the last meeting of the working party, British Rail told the union representatives that the Government are now prepared to grant credit facilities for this purpose, yet at this very time there are rumours that everything is not as straight forward as the Minister had said.

In this respect I want to quote again from the letter that I received from the Secretary of State for Scotland. I raised the question of credit facilities with him when I was dealing with the general closure of the Barassie works and the Secretary of State wrote to me saying:

The Government are looking into the German credit terms and are in any case considering at the moment whether it would be possible to improve the E.C.G.D. credit terms available to B.R.E.L."— British Rail Engineering Ltd.— for the purpose of this contract. According to the Secretary of State, the Government are now looking at the terms offered to British Rail to help it secure the Yugoslav contract.

It is strange that when we are receiving these overtures from the unions, from British Rail and from the Government—through the Secretary of State—my hon. Friend the Member for Durham (Mr. Mark Hughes) should receive a letter from the Department of Trade and Industry dated 5th November, following a Question that he put to the Minister dealing with credit support for the sale of wagons to Yugoslavia—and I am grateful to my hon. Friend for giving me this information last night—saying: This matter has been under review by E.C.G.D. and other Departments concerned for some time, but it has not yet been proved possible, due to current doubts about Yugoslavia's creditworthiness"—

Hon. Members

Shame!

Mr. Lambie

— to agree a form of cover that is satisfactory to British Rail Engineering. It is hoped that a final decision will be reached within the next fortnight, and I can assure you that the importance of this order for British Railway Workshops will be taken into account. I tell the Minister that he must clear up this issue. We are in a difficult position trying to obtain information from the Government, and the position is made worse when we receive different information from different Ministers, each contradicting the other.

The workshop's unit at Barassie is no lame duck. It is one of the few profitable units of British Rail workshops. It has always met its targets. Therefore, it cannot understand why it has been picked out. It came as a shock to the Barassie workers to discover that a planner sitting in London—who in all probability has never seen Troon or the Barassie workshops—can draw up a graph like that which I have here and present it to the railway unions, showing on one side the capacity of the workshops in 1971 and, on the other, their capacity in 1973. It comes as a shock when an anonymous person in London can remove a name from one side of a graph that he has included on the other side. It is easily done on paper, in an office in London, but it is a decision which will affect 500 families and 500 workers who, for the most part, are between the ages of 45 and 65. If they are thrown out of their jobs, no other jobs are available in the area. Any firm recruiting in my area wants people below 45 years of age.

It appears that we are going to kill an industry not because it is a failure but because it is viable and is making a profit. All we ask is that we be given the right to work—to bring in money in order to keep our community going. We want the right to remain in Scotland and to work in a traditional Scottish industry.

10.30 p.m.

Mr. William Ross (Kilmarnock)

I intervene briefly because Barassie is a community just a few miles to the north of Troon and a few miles west of Kilmarnock, my constituency.

When a former Secretary of State for Scotland was Minister of Transport the Kilmarnock railway workshops were closed and the men were transferred to Barassie. Some of the people working in Barassie started their working life in the St. Rollox workshops, some in another Glasgow workshop, and others come from the Aberdeenshire area at Inverurie. Now we have only three workshops left in Ayrshire: St. Rollox, Kilmarnock and Barassie.

Although there has been no redundancy at St. Rollox, there has been considerable wastage with no replacement of jobs. I urge the Under-Secretary to acknowledge the Government's responsibility. The Scottish Office also has responsibility here which it cannot dodge.

I have always felt that regional policy should not be purely for the Department of Trade and Industry, but should be followed throughout every Government Department, particularly those Departments which have responsibility for the nationalised industries.

Recent figures show that since this Government came into office Scotland has lost, by redundancies notified to the Department of Employment, 56,000 jobs. I do not suggest that the Secretary of State is responsible for them all, but let him realise the importance of those figures. The instances reported to the Department of Employment are of redundancies involving more than 20 people. Therefore, we can probably add 50 per cent. to the total figure reported, which means that nearly 80,000 people have been rendered redundant in Scotland since June of last year.

The Government must save these jobs at Barassie. There is an economic and social case for Barassie. Undoubtedly, in terms of what can and should be done by the Government, using their powers, matters could be improved. The whole situation stems from the Government's squeeze on the railway. Kilmarnock has already lost 41 jobs. There is a squeeze going on. Jobs are disappearing here and there; a couple of railmen here and a couple there. There is a tremendous run-down of jobs on British Rail.

The Government must accept responsibility. There are over 460 jobs at stake. There are about 100 in Kilmarnock, and others spread around. There is little hope of the men affected being able to get other jobs. The Government cannot go on shrugging off and not accepting responsibility.

My hon. Friend the Member for Central Ayrshire (Mr. Lambie) had a letter from the Treasury about the Yugoslav order which suggested that it will be cleared up in the next fortnight. I trust that the hon. Gentleman will report to the Minister that it is important that that matter should be resolved in a way which will give the railway workshops the maximum chance of participating in this valuable work. That is one thing which can be done.

Concerning redundancy, I trust that the hon. Gentleman will scrutinise carefully all the figures given by the planners of British Rail. I am still pretty sore about what was done regarding Inverurie. Recalling the pressures to which I was subjected as Secretary of State for Scotland, I say that the Secretary of State cannot shrug this matter off. My hon. Friend has put forward a good argument tonight. We have already put it to the Secretary of State for Scotland and to the Prime Minister, but the responsibility lies with the hon. Gentleman's Department. I hope that he appreciates that it is in his power to lighten the load of unemployment about which we have been talking today, and that he will use every endeavour to help Barassie.

10.34 p.m.

The Under-Secretary of State for the Environment (Mr. Michael Heseltine)

I thank the hon. Member for Central Ayrshire (Mr. Lambie) for his kind remarks about my hon. Friend the Member for Bury St. Edmunds (Mr. Eldon Griffiths) who, in anything except the most extraordinary circumstances, would be answering the debate tonight.

I deeply appreciate the sincere note which the hon. Gentleman struck and his great personal commitment to the emotional case which he argued. No one who listened to what he said could be without a deep understanding and admiration for the position which he takes.

The Government recognise the great importance of this subject not only to the people who work at Barassie, but to Troon and to West Central Scotland and, indeed, to British Rail. I am delighted that the hon. Gentleman has raised this subject and given inc the opportunity to say a few words about the Government's view of it.

One thing that I have to make clear—and hon. Gentlemen opposite who were Members before the last Election will know this only too well—is where the ultimate responsibility in this matter lies. The future of Barassie workshops and, indeed, of all British Railways' workshops, is a matter for the Board of British Railways. The Board is undoubtedly faced with difficult decisions, and I am sure that we all sympathise with the Board as it tries to solve the difficult managerial problems with which it is faced in reducing the excess workshop capacity which it considers it has. The action that has been taken has to be seen against the background of diminishing demands for the services that we are discussing, and obviously my Department will keep in close touch with the events that lie ahead in this connection.

The previous Government understood that British Railways, like any other vital industry, have to keep abreast of the times. Unless they do so, there can be no lasting future for the activities of the railway workshops, wherever they are situated. British Railways therefore have no alternative but to gear the demand for the services they provide to the changing needs thrust upon them by society at any time. It is an inevitable, continuing process, and I have nothing but the greatest sympathy for them in their efforts to deal with the difficulties that arise because of changing circumstances.

The Transport Act, 1968, which was introduced by the Labour Government—and I remember the part played in Committee by the previous Member for Central Ayrshire, Archie Manuel—made it clear that the financial responsibility for British Railways lay with the Railways Board, and it was the discipline imposed by the 1968 Act which impelled the Board to conduct its affairs on a sound commercial basis.

The background to the general situation is that the recent changes in freight transport have led to a marked fall in the need for railway freight wagons. This, in turn, has resulted in the need to reduce wagon manufacture and repair facilities, and has had important financial repercussions on the Board's workshops.

The Government have no power to intervene in the way requested by the hon. Gentleman. There is no provision in the Act introduced by the Labour Government, and implemented with the help of the Guillotine, for the Government to intervene in the way suggested by the hon. Gentleman.

Mr. Tom McMillan (Glasgow, Central)

The Government have power to act, in that they could give credit facilities to enable British Railways to tender for 2,000 wagons for Yugoslavia. If we miss this opportunity, Barassie will be closed.

Mr. Heseltine

In view of the short time that I have been left in which to reply, because of the intervention of the right hon. Member for Kilmarnock (Mr. Ross), perhaps I may jump ahead to the assurance that I wanted to give the House in respect of the specific issue of credit. The Government are providing all possible assistance, particularly through credit arrangements, for this Yugoslav order. The Government can only give an assurance to keep in touch with developments in this tendering process.

Mr. Mark Hughes (Durham)

What did the Under-Secretary of State at the Department of Trade and Industry mean by saying that the Government were unable to help because they were not satisfied with the credit-worthiness of Yugoslavia?

Mr. Heseltine

I do not have a copy of the letter before me. If it had not been for the regrettable accident to my colleague he might have had a more personal and continuing involvement in this matter than I have had. The statement I am authorised to make on behalf of the Government is that we intend to ensure that all possible assistance is given in respect of this tender, through credit arrangements, and this must be the best assurance I can give under the circumstances.

Dr. J. Dickson Mahon (Greenock)

In view of the apparent contradiction, will the hon. Gentleman pursue this matter?

Mr. Heseltine

Certainly. I have no hesitation in saying that I will report back to my Minister and ensure that the matter is looked at, to give the most helpful answer possible. I do not wish to withdraw anything I have said about giving what help we can in respect of credit facilities to make the order possible.

It is important to say that the granting of this order does not in any way mean that British Rail will feel able to take a different decision about the future of their workshop pattern. This is a matter now under discussion by the working party and the long-term effects are something which it will want to consider.

Mr. Ross

This is important. It is unfortunate that the hon. Gentleman does not have a copy of this letter. An entirely different picture is given. Has he discussed with the Scottish Office the future of this area, because we get glowing speeches from hon. Gentlemen opposite about the transportation plans to cover the Hunterston area? Surely this should enter the planning discussions and, if it does, Barassie could be saved.

Mr. Heseltine

That is a perfectly proper question. The general issue about employment in the area is one for my right hon. Friend—

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 eighteen minutes to Eleven o'clock.