HC Deb 29 November 1971 vol 827 cc211-20

11.43 p.m.

Mr. James Lomond (Oldham, East)

I welcome this opportunity to draw attention to the disastrous condition of the textile industry. I must make clear that I am speaking of the cotton textile industry and not of wool textiles which are more properly the concern of my colleagues in Yorkshire, although I am sure that many of them will agree with the points that I shall make.

Seventy years ago the Lancashire people believed that three things were imperishable—religion, the Liberal Party and the cotton industry. Religion certainly is still quite strong; the Liberal Party has felt the wind of change. The one in which I am interested, the cotton industry, is certainly going through a very difficult period—so much so that there has been born a Textile Industry Support Campaign, Oldham led, which has been campaigning vigorously both within the Palace of Westminster and in the country at large, to draw attention to the situation in textiles. I think that every Member of this House has received from the Campaign a booklet entitled "The Death of Textiles" which in a sentence sums up their feelings.

The organisers and supporters of the Campaign feel that, unless something is done urgently by the Government, our textile industry, which was the pride of Lancashire at one time, will die, and die before it has had the opportunity, which may come with entry into the Common Market, to revitalise itself. There is the possibility of revival of the industry if we enter the Common Market, but, unless action is taken now on one or two simple and straightforward points, the industry will be dead before that opportunity arises.

There have been several articles on this matter in the Oldham Chronicle, a newspaper which takes a particular interest in the affairs of the industry, and recently an article by its labour correspondent, Mr. Fred Bottomley, told us about the position in the United States. It was a most informative article which described the actions being taken by the United States Government in negotiating new agreements with the Japanese to limit the growth of their exports to the United States. These agreements, together with earlier agreements with China, Korea and Hong Kong, have brought to the American textile industry a measure of protection which our industry would like to see here.

Foreign penetration into this country's textile consumption is running at well over 55 per cent. now. There has been a phenomenal increase in the last few years. It cannot go on if we are to have an industry of our own. I want the Government seriously to consider retaining the quota system along with the tariff system which is to be introduced in the new year. The tariff which is proposed is, in the opinion of industrialists, far too low to sustain the industry.

The industry has enjoyed good labour relations. The trade union movement has not been difficult in negotiations about reorganising and modernising the industry and the consequential redundancies. Many mills have closed. There has been a rapid acceleration in the number of closures in the last few months. In the last 10 years, between 500 and 600 mills closed, but in the last nine months about 80 mills closed, resulting in about 15,000 redundancies in Lancashire. Such a level of redundancies, when compared with the position on the Upper Clyde, for example, can only be regarded as very serious. I do not for a moment suggest that we should be any the less inclined to support the workers in Upper Clyde shipbuilding, but I feel that we should remember that there are other industries just as severely hit. The feeling is that, unless the Government take action along the lines I have suggested and retain some quota, the industry will die.

There is also the important question of the marking of country of origin on imported textiles. Because of the protective measures taken by the United States Government, there will be diverted to this country ever-increasing quantities of textiles from Japan and the other countries I have mentioned.

We are allowing these imports to a far greater extent than any other industrialised country in Europe where in most countries penetration is between 5 and 20 per cent. or less than that in the United States when it decided to take action. This has to be compared with the percentage which we allow without making any great effort to keep the figure in check.

I assure hon. Members that the Lancashire newspapers contain many articles suggesting that they feel that the Government have let down or even abandoned Lancashire textiles. For example, the Lancashire Evening Telegraph talks of four mills closing and speaks of an S.O.S. being sent to the Prime Minister from employers and employees in the area asking for action, apparently in vain. There is a special supplement, "Challenge to Textile", dealing with the very issue of whether the British housewife should be allowed to know where the goods she buys were made.

I know that the Government's view is that marking the country of origin would be a protection not of the consumer but of the manufacturer, but that is unusual logic, because anyone purchasing goods is surely entitled to know as much as possible about their manufacture and quality. Any foreign manufacturer giving good value for money should be unashamed of labelling his goods. If he feels that he is giving British housewives a bargain, he should be proud of telling them that the goods are made abroad and may be expected to give good value. But I do not believe that housewives accept that. I think that they would prefer to buy British, and it is our duty as Members of Parliament to label the country of origin, particularly of textiles, but of other goods, too.

There is a regulation within the General Agreement on Tariffs and Trade permitting a country to take action contrary to the Agreement when the domestic industry is seriously disrupted by excessive textile imports. The Government should consider that provision and taking such action, because nothing could be clearer than that the textile industry is facing its greatest crisis.

In 1921, there were 250,000 weavers and winders employed in Lancashire. Today, there are only 30,000—one-eighth of the labour force of 50 years ago. The industry is on the way out unless the Government take action to save it. To end I can do no better than quote the closing paragraphs of the article in the Oldham Chronicle that I have mentioned. It says: … The textile industry is not asking for financial assitance. It is asking for positive quantitative control of imports similar to that being adopted by the Governments of other developed countries. Against such a background, the industry would quickly prove more than capable of looking after itself. It is of course no longer possible to see Lancashire's problems in isolation. The long-term answer to the problems now affecting all textile producing nations depends on the negotiation of a global all-fibre textile agreement. But if the degree of protection now asked for is not given, Britain will be prematurely released from even the preliminaries to such negotiations". The feeling of employers and workers in Lancashire is that the Government do not care about the industry and are prepared to write off textiles in Lancashire. I hope that the Government will take action which will prove that feeling to be wrong.

11.55 p.m.

Mr. Tom Normanton (Cheadle)

The views expressed by the hon. Member for Oldham, East (Mr. Lamond) genuinely reflect the widespread distress and concern of the industry, not only in Lancashire but in Yorkshire, too. It is no coincidence that today we have debated Northern Ireland, since that is an area of considerable importance to the textile industry.

It is appropriate that the hon. Gentleman should have referred to the need for urgent legislation in markings of origin. I have pleasure in informing him that I shall seek to introduce a Private Member's Bill on Wednesday afternoon, the sole purpose of which is to achieve what he wants, and what I know the industry wants, whether it be cotton, man-made fibre or wool textiles. It may not be adequate to meet all that the hon. Gentleman wishes to achieve, but I assure him that it is one step along the road to meeting the requirements of a major section of the industry.

Mr. Dan Jones (Burnley)

We shall support the hon. Gentleman.

11.56 p.m.

Mr. John McCann (Rochdale)

I raise only two points. First, will the Minister explain how the textile industry can invoke the conditions of the G.A.T.T. regarding the disruption of an industry? Secondly, will the hon. Gentleman make it clear that the textile industry did not ask for tariffs? It asked for tariffs and quotas to run alongside each other for an experimental period, to discover which was best for it.

11.57 p.m.

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

I congratulate the hon. Member for Oldham, East (Mr. Lamond) on raising this important subject and on the way in which he has presented it. I am sorry that in a half-hour Adjournment debate there is not sufficient time for more hon. Members to participate, because I know how strongly they feel. However, I believe that there will be other opportunities, perhaps even this week, to express a view.

We all recognise that the cotton and allied textile industry has for many years been going through a period of difficult readjustment. It is not alone in this; other industries in this country are facing similar problems and the textile industries of other industrial countries have many of the same difficulties as Lancashire.

Successive Governments of both parties have striven to help the industry and its workers, to adapt to changing national and world conditions. I would like to make it clear that this Government wish to see an industry that is strong, viable and internationally competitive.

To this end, we have endorsed the policy adopted by the previous Government in July, 1969. The policy was based on the recommendations in a two-year Productivity and Efficiency Study by the industry's own Textile Council, which set out a programme for restructuring the industry into an entity that would be fully competitive by European standards by 1975. The two principal measures in the recommendations were the imposition of a tariff on cotton textiles imported from the Commonwealth Preference area and further efforts by the industry itself to re-equip and move to multi-shift working with an associated higher wage structure.

This House will have an opportunity shortly to debate the order introducing a tariff on Commonwealth cotton textiles on 1st January next.

I acknowledge with satisfaction the successful efforts which many firms in Lancashire, big, medium and small, have made to increase their competitiveness by installing new plant, by streamlining their organisation and management, by improving design, by better marketing and in many other ways. I also acknowledge the wholehearted support which these efforts have received from the textile unions. Labour relations in this industry are a shining example of what can be achieved by good leadership on both sides, which underlines the importance of appreciating how the other side views common problems.

It was fundamental to the Textile Council Report—which was accepted by most of the industry's leadership as well as, as I said, by both the previous Government and this one—that numbers of mills and workers would continue to fall if the objective of a trimmed-down competitive industry were to be achieved. Specifically, the Council forecast that the numbers employed in spinning, doubling, weaving and finishing would fall from 125,000 to about 75,000 between 1968 and 1975, and the number of mills would fall from 715 to about 300. The Council also recognised that the pattern of production would have to change, notably that knitted fabrics would develop more rapidly than the output of traditional woven cloth.

In a sense, it is premature to judge the results of this policy when one major element—the new tariff—is only about to be implemented. The Labour Government decided to give both the industry and overseas suppliers plenty of time to prepare for the change. They also decided that when the new tariff came in on 1st January, 1972, the existing system of quantitative restrictions on cotton textile imports from low-cost suppliers should end.

Mr. Dan Jones

It should be recorded that the industry is disputing that evidence.

Mr. Grant

Be that as it may, this, as I understand it, was what the previous Government decided to do.

Those who predict disaster for Lancashire should keep things in perspective. Currently, employment in the cotton and allied textile industry is about 98,000, just about on the curve forecast by the Textile Council. The labour force in textiles in the textile belt of Lancashire has fallen by about 11,500 in the last year, but unemployment in the industry increased by only 2,000, so that most of those becoming redundant either found new jobs or withdrew from the labour force. Any increase in unemployment is a matter for concern, as this Government have repeatedly made clear, but even in the textile belt of Lancashire unemployment is not primarily a textile problem.

Mr. McCann

One of the problems we are faced with is that while unemployment generally has risen by 20 per cent., in spinning and weaving it has risen by 150 per cent.

Mr. Grant

That may be, but the point I was making was that unemployment is not primarily a textile problem, even in Lancashire.

Mill closures have gone no quicker than the Council forecast. In the first two years after the Report, closures went more slowly than foreseen, and though the rate is now catching up, there are still 200 more mills left in the industry than the Council thought would be needed by 1975.

Imports have risen this year, but there have been special factors. Late shipments of woven cotton cloth against 1970 quotas arriving in 1971 swelled the figures earlier this year, while the ending of duty-free imports from the Commonwealth next January must be encouraging traders to make the most of this year's facilities. There is also evidence that overseas suppliers have held their prices steadier than United Kingdom producers whose prices rose by about 20 per cent. between 1968 and 1970. If price differentials are a cause of the present situation the new Commonwealth tariff will help.

It is noteworthy that four-fifths of the increase in imports of woven fabrics of man-made fibre come from European and North American sources, not from low-cost suppliers.

The Government are watching the import situation closely. That includes the implication of recent United States action. They have put proposals to the industry for joint machinery to collect information swiftly on market developments, including imports. They are ready to use their powers against dumped or subsidised imports if industry can make out a case of material injury or the threat of it. My hon. Friend the Minister for Industry has already assured the British Textile Employers' Association that the power we have reserved to reintroduce quotas against disruption after next January will be used effectively, and that it would be a matter for concern if the Government's object of fostering a competitive and streamlined industry were jeopardised. The Government are considering in the light of the employment situation and recent international developments in the textile trade whether there is any need for further action at the present time in relation to the industry.

As regards origin marking, the Government have already indicated that if, as they hope, the Private Member's Bill to be introduced by my hon. Friend the Member for Leicester, South-East (Mr. Peel)—which, I understand, will in my hon. Friend's absence, be presented by my hon. Friends the Members for Oldham, East and for Cheadle (Mr. Normanton) is framed to provide a satisfactory answer to the fears which have been expressed about the possible deception of the public in the absence of origin markings, it will have the Government's encouragement and support.

The Government recognise that a fundamental factor in the prosperity of the textile industry, like any other industry, is a sufficient level of demand. They have taken measures, of which the House is fully aware, to encourage demand in this country. I am confident that these measures will before long revive the demand for textiles. Increased national economic activity will also create new jobs in the textile areas and so help absorb—as has usually happened in the last 25 years—labour released by the closure of surplus textile capacity. A little further ahead, entry into the European Common Market will give us a market five times the size of that in the United Kingdom alone. I am confident that the new cotton and allied textile industry which is emerging will find plentiful opportunities in that vast new market.

The Government recognise the difficulties through which the industry is passing. We appreciate the concern and anxiety of hon. Members about this industry, and the number of hon. Members present for this half-hour Adjournment debate indicates that. I do not at this stage think that I can go further than I have done in indicating that the Government share the concern of hon. Members about unemployment, and I have given the assurances which I hope will be acceptable in this respect.

12.10 a.m.

Mr. John Roper (Farnworth)

We are disappointed at the lack of information from the Minister this evening. We were hoping to hear him outline something of a strategy to deal with the serious problems of this industry, bearing in mind that the Textile Council has said that the textile cycle is worse than it has been in the past. We wanted to hear about some interim plan to deal with the problems in the industry during the period before the possible benefits of entry into the E.E.C. can accrue. We heard nothing from the Minister about what this country's textile policy within the Community will be, or about how our policy might or might not be harmonised with that of the Community. That is what we hoped to hear about, but we did not.

The Minister spoke about unemployment not having risen. If he were to look more carefully at the figures, he would realise that there are many women operatives in the Lancashire textile industry who have become unemployed during the last few months, but as they pay only the lower rate stamp, they do not register as unemployed. The figures quoted by the hon. Gentleman are therefore totally meaningless, and show the complacency of the Government and their failure to deal with—

Mr. Anthony Grant

The hon. Gentleman must not misquote me. In no way did I indicate complacency. My words were chosen carefully when I said that it was important to keep the matter in perspective. I am sure the hon. Gentleman will appreciate that the mere fact that during a half-hour Adjournment debate I have not announced an entirely new policy does not mean that the Government are not looking at this matter with great concern.

Mr. Roper

Complacent words can be chosen carefully. We had hoped for more useful words, but we did not get them.

The House will no doubt have other opportunities to return to this subject, and when we do we shall press the Government for a policy to help the Lancashire cotton industry, which has suffered far too much in recent years from inadequate attention from Governments.

Question put and agreed to.

Adjourned accordingly at twelve minutes past Twelve o'clock.