SCOTLAND (ECONOMIC SITUATION)

HC Deb 07 February 1972 vol 830 cc979-1048

3.40 p.m.

Mr. Richard Buchanan (Glasgow, Springburn)

I beg to move, That this House, noting with concern the thousands of families in Scotland suffering the indignity of unemployment and the increasing poverty caused by rocketing prices, calls on Her Majesty's Government to initiate massive new expenditure on the Scottish social and economic infrastructure and to stimulate a very rapid rise in investment in new and existing industry. One always looks forward to being successful in the Ballot for private Members' Motions. It gives all to few of us the opportunity of raising matters which would not otherwise be raised in debate.

I am doubly fortunate because this is the second time that I have been successful in the Ballot. On the first occasion, in 1965, I had the privilege of raising the question of the University of the Air. Today's is a different story. There are many subjects which I should have liked to raise—the protection of the environment, tunnel motorways as opposed to motorways, nursery schools, the chronic sick and disabled, and so on. The list is endless, and it is a criticism of the Government that whichever of my hon. Friends had been lucky in the Ballot would inevitably have had to choose a subject for debate such as the one I have chosen today.

I intend, not to weary the House with an excess of statistical data or quotations, but to confine myself to the two or three necessary to identify the problem. I do not intend to approach the debate in a polemical spirit. I am concerned with the future and not with the past. I am sure that all hon. Members deplore the excessively high and unacceptable level of unemployment and are concerned to secure the best package of policies which will bring national and regional prosperity. I hope that hon. Members will forgive me if I spend some time in discussing the problems in my constituency.

Identifying the problem, there are 154,356 people out of work in Scotland. My hon. Friends the Members for Glasgow, Bridgeton (Mr. James Bennett) and Glasgow, Scotstoun (Mr. Small) asked a Question of the Department of Employ- ment about employment in the Glasgow area. The reply was: The Government has introduced a wide range of measures to reduce unemployment, many of which are directed at the special development areas of which Glasgow forms a part, and it will take such further measures as are necessary to achieve this aim."—[OFFICIAL REPORT, 3rd February, 1972; Vol. 830, c. 163.] When does it become necessary to try to reduce the terrible level of unemployment? If there are 154,000 families involved, it means that anything up to half a million people are living on social security; they are living on the bread line and no more.

This is an intensely human problem, not an abstract problem. Nearly 17,000 young people under the age of 18 are out of work in Scotland. Of those, 3,641 are school leavers and many of the balance have been out of work since they left school. Among this figure are the vandals, the mischief-makers, the unwanted and the rejected. The stigma of rejection stays with people for very many years, as I know from experience. When my father died, I had to leave school regardless. I was lucky enough to get an apprenticeship, but when it was finished I was out of work. I know what the stigma of rejection means, and I know how long it took me to get over it. Young people today, having passed their O levels and higher examinations—and passing examinations does not get any easier—and leaving school full of ambition and ready to start earning their living, are met with a blanket "No, no, no".

In my constituency 559 school leavers are out of work. There are 7,000 people out of work in the Springburn travel-to-work area, an increase of nearly 2,000 since last year. Unemployment continues to spell despair for many thousands of people. It is the most corroding malady which can afflict any community or individual. When unemployment is accompanied by rising prices, as it is under the present Government, it spells disaster as well as despair for thousands of families.

The unemployment goes right across the board. On Saturday a young man came to my "surgery" who had graduated from Glasgow University with a B.Sc. with honours and had gone on to take a Ph.D. in chemistry. He has written to all the big firms which employ scientists and has had acknowledgements from all of them but no employment. He now does private tuition and has applied for entry in the autumn to a teachers' training college. One of the things which worry me about secondary education is that so many qualified young people are going to teacher training colleges but if industry picks up the secondary schools will be in the same bother of teacher shortage as they have been for many years. This young man has no immediate prospect of employment.

There are young tradesmen who, having served their apprenticeship, are filled with hope, but that hope is wearing very thin. There are semi-skilled and unskilled people who have given up hope because they have been unemployed for so long.

The older part of my constituency was in the vanguard of Britain when Britain was the workshop of the world. All the old industries have gone—the North British Locomotive Company, which sent locomotives all over the world, the North-Eastern Railway repair shops, Frederick Braby, Callander Cables and I.C.I., part of which is in the constituency of my hon. Friend the Member for Glasgow, Central (Mr. Tom McMillan). In the depression of the 1930s at least the factories and the workshops remained. While they remained there was hope. But they remain no longer; they have gone.

Old Springburn is now rather tired, run down and dilapidated, as are many other parts of Glasgow. Those of us who travel to and from Glasgow either by air or by rail cannot fail to see that the older part of the city has a rundown, neglected look. This is an area where immediate Government action could have an immediate effect. I am sure that Glasgow Corporation could employ at least 5,000 people on demolishing empty, derelict buildings, clearing sites and giving a lift to the "Operation Facelift" which is proceeding. The problem in Glasgow must be the same in many other towns and cities throughout Scotland, this allied to the proposals of urban conservation put forward by the National Trust and ably presented in the House by my hon. Friend the Member for West Lothian (Mr. Dalyell)—and our sympathy goes out to my hon. Friend in his recent sad bereavement—for cleaning up our towns and cities during this calamitous period in our industrial history could, if the Government were serious, be put to good use. But there is no point in agreeing to this or in simply saying to the cities, "Go ahead". There is no sense in asking the corporations and town councils to solve the problem and heaping the cost on the backs of the ratepayers. If this job is to be done, it must be done at Government expense, and a 100 per cent. grant is necessary. If it is not done now, we shall have an enormous backlog of derelict land and buildings to clear which will hinder us no end if the economy starts to reflate and grow. Dilapidation does nothing to encourage industry. It is essential that we have a continuing policy for the controlling and preventing of decay of older buildings. The dereliction in some of our major towns and cities is quite disgraceful and, as I have said, plays no part at all in attracting industry.

In contrast to the old Springburn the new Springburn has high hopes. With co-operation between the Government, Glasgow University and Glasgow Corporation the whole area was surveyed. At that time it was the biggest area of survey in Glasgow that there had been. The plans were prepared; the plans were amended; they are now in the hands of the Secretary of State. I hope that he will do something to speed the inquiry which is about to take place. The new Springburn has plenty to offer—new houses, excellent private houses in the hinterland, industrial estates owned by the corporation, industrial estates owned by Scottish Industrial Estates. The communications are excellent, and there is a first-class railhead in the middle of the constituency at Sighthill.

Yet I am hearing at the weekend that British Railways are contemplating the closing of the marshalling yards in Glasgow. It seems to me strange that British Railways always make their forward plans for closures in a period of recession. They seem to take no cognisance of the possibility that industry will be picking up. It seems to me short-sighted that British Railways should contemplate the closing down of the marshalling yards and closing down railway lines at this moment when they should be looking ahead and preserving railway lines, because the environment is suffering considerably from the motor car.

There are good road communications in Springburn. The educational facilities are excellent, and we have the Spring-burn College of Engineering in the middle of the constituency. The local traders have such confidence in the Springburn of the future that they have formed their own development company to develop the commercial centre.

As I say, the Springburn plan is before the Secretary of State, and I ask him to speed it up, for, as with most planning inquiries, we shall inevitably be faced with procedural delays.

It is not in the least surprising that we have difficulty in attracting industry, and one can point to what happened with Murco and Chevron. It took the authorities at least two years to say "No". It should be possible in this day and age of zoning to zone areas for industry, for residential, educational and recreational purposes, and then to say to industrialists, "Here are sites which we can give you". Then an industrialist could go ahead without having to find a site and submit himself to all the paraphernalia of planning procedures, without finding himself, after a delay of two years, told that he must find another site. It is time we had a long look at these planning procedures to streamline them more than somewhat.

I have always felt that it was just as wrong to discriminate against people in the regions as it is to discriminate on grounds of race, colour or creed. When the United Kingdom was the workshop of the world we had a balance between regions. The same cannot be said today. We saw the United Kingdom's economy, north, south, east and west, booming in those days, and Scotland had its share. Scotland was unfortunate in as much as it had more than its share of heavy industry, which is difficult to replace in a time of recession.

Again, at a time when we are hard pressed we have a situation in which the nationalised industries in Scotland are transferring staffs from Scotland to England. We need to be constantly vigilant to overcome the southern pull of Government, Civil Service and industry to England.

The British Steel Corporation is transferring 400 employees from its tubes sales division at its base in Oswald Street, Glasgow, to Corby. This seems to me paradoxical at a time when oil and gas have been discovered in the North Sea and there is bound to be a tremendous market for equipment to service such industries. I would imagine that tubes would play a particularly prominent part in those operations, and yet here we are transferring the tubes sales department of British Steel from Glasgow to Corby. British Railways are transferring their computer payroll from Glasgow to Crewe. The payroll work is being done very efficiently at Glasgow. The trade union concerned—a national union—is behind the employees in their fight to keep the computer payroll staff in Glasgow.

British Railways are closing their works at Barassie when we have the proposed development at Hunterston. If Hunterston starts and other things get going from Hunterston obviously we shall need oil tankers, gas tankers, wagons of every description, and yet British Railways, at this moment, are proposing to close their railway wagons workshop at Barassie. It may be necessary, I admit freely, occasionally in a period of rationalisation to transfer some part of a nationalised industry's staff, but surely there ought to be compensatory transfers. Why has the policy of the Government not been implemented in transferring some of the Civil Service offices from the South to the North?

Most, though not all, of what I have been saying has been about first-aid matters, but there is still one other point I want to make. particularly to the Secretary of State. About a month ago there was a paragraph in The Glasgow Herald which pointed out that a very famous hospital in Scotland had ceased recruiting nurses because it was in trouble through over-spending on the nursing account. That seems to me ridiculous in a period when the people have been conned about the payment and employment of nurses because there are so many trainees in wards where there should be trained staff; and if any hospital has been over-spending in obtaining trained nurses it really has over-spent in a very good cause.

As I say, I have spoken so far of mostly first-aid measures. What we need in the long term are not simply measures to alleviate local patches of unemployment but measures for the regeneration of wide areas where the structural decline of Victorian industries has created untold problems, as I have been instancing in my own constituency of Springburn.

All of us were delighted to hear the right hon. Gentleman's announcement last Monday that Clydeport and the British Steel Corporation were talking about the establishment of the ore terminal at Hunterston. I hope that today he will dot the i's and cross the t's because there is a little doubt whether, though they were talking, the talking will come to anything. I am not talking of development at Hunterston purely from a Scottish viewpoint. I am speaking—it hardly needs to be stressed—of the importance of Hunterston for the economy of the United Kingdom. This is potentially the greatest port in the United Kingdom. It is potentially a port which will rival any of the other ports in Europe —or America, for that matter. It is essential for the benefit of the United Kingdom that it should be developed.

We were glad to hear, at last, that we were to take advantage of the unrivalled facilities at Hunterston. But too often when something is done it is done half-heartedly. I well remember the battle of my hon. Friends and the Scottish T.U.C. to get the Colville strip mill at Ravenscraig. It was imagined that this would bring to Scotland the consumer durable industries which use strip steel. In the event, it was found that the strip mill alone was not a powerful enough magnet to attract, so B.M.C. and Rootes were persuaded to open up in Scotland. We are very grateful, too, that they did. This done, the half-planners were confident that the industries ancillary to motor car manufacture would follow. Again they were wrong. They ignored the commercial fact that two factories together do not comprise a large enough market to make a move worth while for the component firms. One more factory might have done the trick.

Our bankers and businessmen have a long tradition of caution. The present Government, it is said, are a businessman's Government. But this is not the time and Hunterston is not the place for caution. An ore terminal on this site will meet the demands of the existing Scottish steel industry. It would make even more sense if alongside were provided the new integrated steel plant, the oil refinery and the deep-water jetty.

If the British Steel Corporation intends to increase steel production in Britain from 24 million tons to 42 million tons, with current plans for production of 30 million tons, there is a shortfall of 12 million tons. A fully integrated steel plant at Hunterston could meet this requirement, and with a thriving steel industry the chances of developing steel-using enterprises are unlimited and of a kind which would promote and sustain real growth.

The development of Hunterston as a port gives an impetus to the imaginative concept of the Ocean Span, Landbridge. When this idea was first mooted it was received rather coldly, but the prospect of growth which Ocean Span denotes and the jobs which it could create in petrochemicals, plastics, oil derivatives, light and heavy engineering and electronics mean high investment, but also a loss of amenity. There will be objections on that basis, but unless we increase our wealth we cannot improve the environment and the social services as we should like to. Productivity is the key.

One of the main causes of inflation is the paying out of unemployment benefit. We should get the men working to create wealth. This is where the investment in Hunterston and Ocean Span and all that it means will pay dividends for the United Kingdom.

As there is discrimination against regions, so also within a region there is discrimination against parts of it. We have discovered oil and gas in the North Sea. Aberdeen is at the centre of things, and I hope it will become the boom town it deserves to be. But there is great danger of the boom generated by the discovery of North Sea oil and gas sucking from the hinterland much of the labour needed in the Highlands and Islands.

I have a stake in Tiree. The transport services to the Western Islands should be experienced by all hon. Members. They would then have something to say to the Highlands and Islands Development Board and to MacBrayne's and Western Ferries. The transport system isolates the people in these islands for long periods. I tried to get the Postmaster-General to do something to improve television reception in the Isles at a cost of something like £4,000, but this was far too expensive! With all that is happening in Scotland and with all that can be happening, never has it been more necessary to have an overall plan of economic government—

Sir Myer Galpern (Glasgow, Shettleston)

I have been following with great interest my hon. Friend's contribution. Does he not feel that he is being rather unfair on the Secretary of State for Employment and that the unemployed should wait just a few years longer? I refer to the speech which the Secretary of State made at the weekend to the national Young Conservative conference, when he said that the Government are pinning all their hopes now on joining the Common Market. Evidently, the Government have abandoned any concern for the unemployed, and everything will now flow from the day when we join the E.E.C. I should like to hear my hon. Friend's observations on that point.

Mr. Buchanan

For many years I have been a colleague of my hon. Friend the Member for Glasgow, Shettleston (Sir Myer Galpern) on Glasgow Corporation. During those years I have found that he never listens to the beginning of anyone's speech and always takes every opportunity to air his prejudices.

I said in the earlier part of my speech that I had suggestions for first-aid measures to deal with the sucking up of the present unemployment. I then went on to deal with other parts of national policy, Hunterston and Ocean Span, which are not entirely Scottish but more United Kingdom measures, although they greatly benefit Scotland. The potential is always there in Scotland. What we need is overall economic Government.

When the Secretary of State for Scotland appointed an Under-Secretary of State for Development I thought this was an excellent idea and I applauded the initiative of the visit to Germany to try to get German investment over here. Our interests should be much wider than Germany; they should be world wide. The Under-Secretary of State for Development should be concentrating on development. He should be the head of a development authority. Instead, the Minister at the Scottish Office in charge of development is imprisoned in Committee Room 14 in charge of a punitive, doctrinaire housing Bill which has nothing to do with development.

Mr. William Ross (Kilmarnock)

The Under-Secretary is not imprisoned; he can go away any time he likes.

Mr. Buchanan

The hon. Gentleman is there in charge of a housing Bill which will contribute nothing to development.

Help should be given to existing industry. Job provision should be the criterion whether an industry or an industrialist will be helped.

Mr. T. G. D. Galbraith (Glasgow, Hillhead)

That is a valid point. The hon. Gentleman said that help should depend on the number of jobs created. He earlier said that the Government should help Ocean Span, Hunterston and the petro-chemical industries. Is it possible to do both? I understand that the petro-chemical industries will not produce many jobs, although the hon. Gentleman is saying that the number of jobs created should be the criterion. I should be grateful if he will answer that.

Mr. Buchanan

The Chancellor of the Exchequer spends much of his time boasting about our gold reserves and our overall surplus, and I think it is not beyond the bounds of possibility for the Government to help in many ways to boost the economy. There is also a weekly payment of £4 million in unemployment benefit. Existing industry needs a boost.

A man in my constituency has taken over an old printing warehouse in which he has built up a business making ladies' and children's clothes. He has now come to the point where he must expand, but he does not have the collateral. He has sought aid from the Government and from the local council, but it is not forthcoming. This means that to get all the aid they require companies will be forced to move to one of the new towns. Local authorities provide home mortgages. The Secretary of State should encourage them to look at the question of industrial mortgages to attract industries to their various areas.

We were pleased to learn from the Department of Employment about the expansion of training facilities, which will become more and more necessary in the future. This is a matter on which the Government and the trade unions should be getting together.

I was a time-serving apprentice and received my training as an engineering toolmaker. I believe that young people should be trained in multi-skills since training in single skills tends to lead to lines of demarcation. The Minister and the trade unions should be getting together to draw up a new system of apprentice time-serving so that the youngsters who go into industry may put their hands to most, if not all, tasks.

We live at the moment in a period of political and economic uncertainty. I recall a similar period in our history in the 1930s when a party of Scots got together and formed the Scottish Industrial Estates. The first estate was put down at Hillington. There are now 20,000 people employed there. That estate was opened in 1937. The organisation then ran the Empire Exhibition, which opened in Glasgow in 1938. That was confidence. What is lacking in Scotland among industrialists and people dealing in commerce is confidence in the future of Scotland. This feeling of confidence must be given to the Scots. The Glasgow Herald has already flown the kite of an exhibition, and is supporting it enthusiastically. This plea should be taken up by the Government to let the Scots see that they are still an industrial force in the world. Many since June, 1970, have ceased to believe in themselves.

To conclude, I have been talking about nothing new. I have been talking about giving a face-lift to our society in cleaning derelict buildings and sites. I have asked the Government to stop transfers from nationalised industries and have also asked the Government to implement their declared policy of transferring Government offices from the South. I have asked them to provide the wherewithal to staff the public services. I mentioned nurses but the same thing applies to the police, firemen and so on.

I have also asked the Government to review the investment needs of the Scottish economy, to restore investment grants and to bring forward appropriate proposals. I have spoken of the need for streamlining planning proposals. In regard to Hunterston I have asked the Government to go the whole hog with further proposals in relation to oil, steel and the deep-water jetty. I have asked them to push ahead with Ocean Span, to expand the development areas and to consider each case on its merits.

I hope that my hon. Friend the Member for Dundee, West (Mr. Doig) has an opportunity to take part in this debate since he has spoken to me of a case that demands investigation. I have asked the Government to postpone the abolition of the regional employment premium, and have also mentioned the important matters of training and retraining and the holding of an exhibition. I have put forward the proposal that there should be an overall plan for economic government. As I said earlier, we should be finding markets for our products at home and abroad, and I hope that the Under-Secretary of State for Development will be put in charge of this Department with no distractions.

There is nothing new in any of these ideas, and the fact that they have been going the rounds for such a long time is a further condemnation of Her Majesty's Government. The prime responsibility for location, relocation and expansion of industry lie fairly and squarely on Her Majesty's Government, which have the power, the resources and the persuasion —to put it no higher—to use to the utmost if they so desire. Scotland expects no less.

Mrs. Judith Hart (Lanark)

On a point of order, Mr. Speaker. May I bring to your attention—I will explain why I think this is a matter for you, Sir—the fact that, although on the Government Front Bench there are representatives from the Scottish Office and on this side of the House our shadow Scottish Ministers as well as my right hon. Friend the Leader of the Opposition, we do not have present any Minister from the Department of Trade and Industry. Many hon. Members on this side of the House, including myself, wish to raise matters concerning that Department. I raise this matter with you, Mr. Speaker, because, although I appreciate that this is a private Members' debate, I feel that we should have a representative here from the Department of Trade and Industry. I regard it as a great disservice to the House that there is none present now.

Mr. Speaker

I am afraid that, however persuasive the point of order may be, this is not a question for me. I have no control over the content of the Front Benches.

4.16 p.m.

Mr. John Brewis (Galloway)

We have recently had more than one debate on unemployment, and next week many of us will be attending a conference organised by the Scottish T.U.C. However, I should like to congratulate the hon. Member for Glasgow, Springburn (Mr. Buchanan) first on his luck in the Ballot, and secondly on the tone and content of his speech, which we all enjoyed.

We all agree about the wastage and misery of unemployment. Many of us will share his annoyance about nationalised industries and Departments of Government transferring work from the development areas to the South and to the Midlands of England. I remember a similar case which occurred at Inverurie during the period of office of his Government. Transfers do take place the other way, such as the Savings Bank headquarters which came to Glasgow secured by my right hon. Friend the Member for Argyll (Mr. Noble). Rapid wage increases, plus the redundancy payments scheme introduced by the Labour Government, have made many industries reduce their manpower. We are at present securing nationally the same production with something like 4½ per cent. less labour. But we cannot expect this increase in productivity to continue, and if the economy expands at the rate of 5 per cent. as is confidently predicted, there will be considerable scope for taking on more labour.

The hon. Member made several criticisms of the present Government. It was no part of his case to mention the industries where things are going very well. The first industry I will mention is one which is not greatly represented in Springburn. I refer to the agricultural industry. I cannot remember a time when there was more confidence in the agricultural industry as a result of the injection of cash in the October special review and last year's price review. I know that there are many views about entry into the European Economic Community. What we need at present is a continuation of this policy so that we can secure import savings for British agriculture on entry into the Community.

Mr. Harry Ewing (Stirling and Falkirk Burghs)

Since this debate is primarily about people and jobs, would the hon. Gentleman agree with me that there are now very many fewer people employed in agriculture? The hon. Gentleman says that there is confidence, but this does not detract from the fact that mechanisation in itself has led to far fewer people being employed in agriculture. Is this not what this debate is all about—people in jobs?

Mr. Brewis

I am quite ready to agree with the hon. Gentleman about that. However, I think that he will agree that that is the case in many other industries. In mining, for example, we have seen a rapid run down in employment in the last few years.

The second industry which I wish to refer to as being of importance to Scotland is forestry. There are more than a million acres in Scotland under trees. Once again, we see increased confidence resulting from higher timber prices, and general satisfaction with the Government for securing the removal of the headquarters of the Forestry Commission to Edinburgh. When will the results of the present review of forestry be announced? This may also help bring more employment to Scotland.

Mr. Robert Maclennan (Caithness and Sutherland)

The hon. Gentleman seems to have overlooked the declining work force engaged in forestry, just as he did in regard to agriculture. Does not the hon. Gentleman agree that in rural areas where there has been traditionally a number of jobs in forestry, this tendency is exacerbating the difficulties?

Mr. Brewis

I am not sure that I agree with the hon. Gentleman, especially as it affects his own constituency, where a great many people are now employed in forestry. If I may say so, some of the planting there is hardly likely to be profitable when it is harvested, owing to the extreme conditions under which it is planted.

I turn to tourism, which is another industry of great potential to Scotland. Here, there are jobs available. Sometimes I think that it is a pity that more Scots do not enter the industry. So often one finds that key jobs in the tourist industry are occupied by foreigners.

The last industry that I wish to mention is fishing. In general, the inshore fishermen are satisfied with the agreement that my hon. Friend the Under-Secretary for Agriculture at the Scottish Office brought back from Brussels—

Mr. Ewing

Rubbish.

Mr. Brewis

There is still considerable anxiety in the Solway ports. I have in mind such ports as Annan, Kirkcud-bright and Garlieston. The main catch is Queen escallops, and 90 per cent. of them are taken from outside six-mile limit. In case any hon. Member thinks that this is a small industry, let me point out that the value of landings in the Solway ports last year was £637,000. It is an important industry to my part of the world. Recently, a factory has been set up at Kirkcudbright for freezing and processing the escalops for the French and Belgian markets. If the waters where they are caught are to be open to their own fishermen, why should they buy from us rather than scoop up the catch from this area of the North Irish Sea? It is a serious matter when the livelihood of 70 or more men in a rural area is put in jeopardy. I have asked my right hon. Friend the Minister of Agriculture, Fisheries and Food to look urgently into the possibility of conservation and protection measures. I hope that a 12-mile limit can still be obtained round the Isle of Man. Is my right hon. Friend the Secretary of State for Scotland in a position to give me any reassurance on this subject?

I turn now to a few more general points. Entry into the E.E.C. will give Scotland the opportunity to attract industry from several industrial countries where at present there is a labour shortage. The hon. Member for Springburn mentioned Germany where, at present, there are over 2 million foreign workers employed from countries like Greece and Turkey. I know that both the Scottish Council for Development and Industry and my hon. Friend the Under-Secretary of State for Development, Scottish Office, have paid visits there. Has anything concrete transpired?

I have heard it said, and I believe it to be true, that a great disincentive to attracting European industry is the reputation that Scottish industrial workers have for being strike prone. In fact, there are tens of thousands of workers in Scotland who have excellent industrial relations with their employers and hardly ever, if at all, go on strike. But it is the few who make the headlines. Last week, for example, workers were on strike at Yarrow's shipyard, at Chryslers at Linwood, and at British Leyland at Bathgate. There was the miners' strike as well, and certainly Scottish miners have the reputation of being a militant section of their union. I am surprised to have heard no mention of this so far from hon. Gentlemen opposite. Nor is any reference to it included in the memorandum from the S.T.U.C. to the conference which is to be held next week. Here is something positive that the S.T.U.C. could do.

Like the hon. Member for Springburn, I welcome the announcement of the ore terminal at Hunterston. I hope that it presages further development. Is the Scottish Council's concept of "Eurospan" receiving urgent attention? The possibility of giant ships using the deep water of the Clyde and the central belt of Scotland as a land bridge to Europe is an exciting one. Time is important. The French are well on with a similar development at Fos, near Marseilles. Experience obtained there could well let them get ahead with a similar project using the deep waters off the Brittany coast.

The hon. Member for Springburn also mentioned the Murco inquiry, which was very long drawn-out. Eventually, planning permission was refused for the site that the company wanted. Surely we can improve our planning procedures so that it does not happen again. I agree that amenities and tourism are most important. Equally there must be a place in Scotland for modern technological industries like oil refineries, especially in view of the oil finds in the North Sea.

Ideally, it seems to me that sites should be zoned, with the objection procedure overcome so that, when a company like Murco or Chevron comes on the scene, it is possible to tell it that it may go to site A or site B and start its work right away but that it may not go to site X or site Y. Do we need to go on waiting until after local government has been reorganised for the Town and Planning (Scotland) Act, 1969, to be implemented? Are not we in danger of falling behind England in getting on with our structure plans?

Over the next few months, we have to face the fact that unemployment in the Midlands and the South of England will make it harder to refuse industrial development certificates. I have never been a great believer in the effectiveness of the I.D.C. system, which is generally not part of the regional policy of any other industrialised country—

Mr. Edward Taylor (Glasgow, Cathcart)

There are two affecting tiny areas of France.

Mr. Brewis

I am obliged to my hon. Friend. However, I think that it is fair to say that, generally speaking, it is not part of the regional policy of other industrialised countries. Even in times of high employment, 90 per cent. of applications for I.D.C.s were granted. We have to look carefully at the attractiveness of inducements not only for industrialists to go to development areas, but also for those already there to expand.

We must encourage further employment in the service industries. In my view, the selective employment tax was a half-baked tax in terms of its effect on Scotland. I think though that it is quite possible that a pay roll tax or congestion tax could be worked out which would be of great benefit to development areas. I welcome the Government's decision to halve S.E.T. and to abolish it as soon as possible.

I want to make reference to regional employment premiums, which were introduced by the last Government and which are due to expire in 1974. We are getting rather close to 1974. Investment decisions are made at least two years ahead. My hon. Friend the Under-Secretary of State for Development, Scottish Office, will probably recall the evidence before the Select Committee on Scottish Affairs of Sir Robert Maclean, who is head of Scottish Industrial Estates. He said that what was attractive was the whole package of inducements. He compared the package to a three-legged stool: one leg was the grants system, another leg was the factories available for incoming industry, and the third leg was the R.E.P. When it was introduced in 1967, R.E.P. was as powerful an inducement as investment grants, but since then it has remained a set sum. By 1969 its value had been reduced to an edge of 6 per cent., because if wage rates rise and R.E.P. is maintained at the same level, its value must be proportionately so much less, and it will certainly be less today than in 1969.

The R.E.P. is worth a lot of money to Scotland—£40 million. If my right hon. Friend has decided to continue it, or perhaps to increase it, he should announce it as soon as possible. If not, I should like to know how £40 million can be injected into the Scottish economy with the same or better effect.

No one can fail to be impressed by the measures which the Government have taken to reinvigorate the economy, and the seriousness with which they are tackling unemployment. During the coming year, I confidently look forward to a considerable upsurge in the Scottish economy.

4.32 p.m.

Mrs. Judith Hart (Lanark)

I am glad that the hon. Member for Galloway (Mr. Brewis) has appreciated the problems of R.E.P. and he has raised this matter with his hon. Friend, who, I hope, will give a clear answer.

At the outset of what will be brief remarks, because many hon. Members wish to take part in the debate, I want to stress the significance of some of the statistics about employment in Scotland. The broad outlines are well known to us. However, I am not sure that the refinements of those figures are equally well appreciated, certainly by some parts of the Press in Scotland, by some people, and perhaps by the Secretary of State himself.

We know that the overall figure of unemployment in Scotland is 9¼ per cent. I should like to indicate that in my constituency—I shall return to this towards the end of my remarks—there is one town, Lesmahagow, with an unemployment rate of 30 per cent., Stornaway has an unemployment rate of 33 per cent., the highest in Scotland, and Lesmahagow's is 30 per cent.

I want to draw attention to the acutely enlarged disparities even within the general national situation of growing unemployment between London and the South-East and Scotland. On the whole, we tend to think that since the national figure has gone up to over 1 million unemployed the special Scottish figures are less important rather than more important. But, looking at the figures and at the disparities and inequalities, we find that in this generalised situation of depression and spiralling unemployment the Scottish situation is becoming significantly worse.

For example, we know that for every available job in Britain as a whole there are seven people looking for work. In Scotland for every available job there are 31 people looking for work.

Breaking the figures down into detailed industries, whereas in Britain as a whole eight trained engineering craftsmen are looking for each available engineering job, in Scotland the figure is 28.

The figures are absolutely devastating when we come to the less skilled jobs. Looking at general heavy labourers, for every available job in Scotland at the moment 540 people are seeking jobs.

Next, light labouring. We must remember that in the category of light labouring there are many people who used to be in the mining industry who cannot now take up heavy labouring work because they are suitable only for light work and, therefore, must join the queue for that at the labour exchanges. For every light labouring job available in Scotland, there are 2,850 men seeking work. That is a totally devastating figure.

I turn now to the other end of the scale. It was always assumed, until this Government came to power, that the two groups of people fairly immune from the unemployment problem were white collar workers in office and administrative jobs. Let us consider the figures for those groups. For every available job in clerical trades in Scotland there are 31 people looking for work. For every available administrative job in Scotland there are eight people looking for work. Included in "administrative" are professional and technical workers, the middle class of Scotland, who never thought that they would be embraced in this problem of unemployment. The Scottish position regarding professional and administrative workers is twice as bad as in Britain as a whole, the position of clerical workers is rather worse than twice as bad as in Britain as a whole, and the position of labourers is about eight time worse than in Britain as a whole. It is clear that within the generally deteriorating economic situation which has arisen in the last year and a half, Scotland's position has become infinitely more acute.

We are talking about people and jobs, as my hon. Friend the Member for Glasgow, Springburn (Mr. Buchanan) emphasised. I congratulate my hon. Friend on introducing the debate in those terms. In talking about people we are also talking about the effect of unemployment upon them. The effect of unemployment on people largely depends on how long they have been out of work.

The Labour Government introduced an earnings-related unemployment benefit and redundancy payments. If unemployment becomes so acute and persistent that it outlasts the period for which these benefits are paid, the effect on people is as devastating as the statistics themselves.

Looking at the overall picture, 34 per cent. of the unemployed in Scotland have been out of work for more than six months. That means that they have exhausted their earnings-related unemployment benefit. Of those over 40 years of age, 51 per cent. have been out of work for longer than six months.

Looking at those who have been out of work for more than a year, it means that they have not only exhausted their earnings-related unemployment benefit. but their flat-rate unemployment benefit. so they are now dependent on the Supplementary Benefits Commission. They are dependent upon the whole means-tested apparatus. We find among the unemployed as a whole in Scotland 18 per cent. have been unemployed for more than 12 months and amongst those over 40 the figure is almost a third—32 per cent.

In terms of the effect on people, these are highly significant figures. For example—let us put it in human terms—it means that a third of our unemployed who are over 40, many of whom are likely to have children still of school age, are dependent upon the whole panoply of rent rebate schemes, free school meals and school milk, and all the means-tested benefits which must be applied for, exposed to the whole apparatus which we know to be so unsatisfactory, in order that they can keep themselves and their families going

I want to draw three points to the attention of the Government. The first is a general one which has been made in every unemployment debate which has touched upon Scotland's problem. The economic policies of the Government which have produced the present terrible situation in Scotland cannot be separated from the Government's general economic strategy.

Therefore, if we are asking the Government to do something about unemployment in Scotland, we are also asking them to do something about their whole economic strategy. The Secretary of State for Scotland is a member of the Cabinet. He takes part in Government discussions on the overall strategy. I wonder how often he raises his voice to criticise that strategy, as distinct from its effects upon Scotland.

Even those of my hon. Friends who totally favour entry into the Common Market will agree that the policy of entry has to a considerable extent determined aspects of the Government's policy that now bear upon the unemployment position, in that the Government have regarded entry into the Community as being a first priority.

The Government having regarded entry as a first priority, two things have occurred. The first was not only tolerated but encouraged by the Government. I refer to the rise in consumer prices. Even the Secretary of State for Scotland must agree that this was not in any way blocked by any Government action. That was reasonable enough, because if the Government's first priority is entry into the Common Market, and if they see the need to adjust the price levels of food and other essentials to accord with Common Market prices, it is wise from the Government's point of view, if not from ours, to allow this process to occur before entry.

This is what has happened. There has been an adjustment of prices to prepare for the value-added tax, and so on. From what we hear of the discussion of the Common Market Ministers on the common agricultural policy at the moment, it seems that we must probably prepare ourselves for another increase in food prices of about 6 per cent. over the next year. Very well; this is inevitable, given the Government's concentration on their priority of entry to Europe, and it does not raise the fundamental issue of principle on the Common Market to say so.

Mr. Maclennan

Is it not highly perverse of the Government, in pursuance of this aim, to follow a policy of regional development which is specifically ruled out by the European Economic Community; namely, the policy of investment allowances as opposed to investment grants? These benefits are ruled out on the ground of their being not calculable.

Mrs. Hart

Indeed. I hasten to assure those of my hon. Friends who disagree with me on the question of the Common Market that I am not essentially making a Common Market point. I am pointing out the inevitability of the effect of the Government's policy on the situation in Scotland.

A second consequence has been what we are only now beginning to hear talked about as "shake-outs". We are now beginning to hear about the differences between structural unemployment and economic unemployment. We are now beginning to hear about the shake-out effects which have taken place in industry over the last year and a half as a result of policies which the Government consider to be highly commendable. In different circumstances they might be highly ccommendable, but not in circumstances when the whole of the rest of the Government's economic strategy has brought about a decrease in investment and, following that, an increase in unemployment.

The devastating rise in unemployment since this Government came to power is not accidental; it is not a misfortune about which they must merely raise their hands and say, "How terrible. We hope for better things." It is a deliberate and inevitable consequence of policies and priorities that the Government have pursued.

It is as a result of this that there is the uncertainty in investment and that there has been the intolerable reduction in the standard of living for people all over Britain, apart from just those in Scotland. The Government have been permitting, and in many cases actively encouraging, prices to increase. For example, the Government have deliberately encouraged prices to increase in the public sector when they could have resisted the increases. I refer to the increases in fares, the price of electricity and gas, and Post Office rates. The increase in those prices is a deliberate consequence of the Government's unwillingness and lack of desire to intervene.

There is at the same time the increase in social service charges—school meals, milk, the prospective rent increases, and so on. There is the fact that company profits, side by, side with the price increases, are estimated to have risen by 81½ per cent. over the last year.

Is it any wonder that we have a miners' strike which is consuming Scotland's main political interest at the moment? Is it any wonder that workers are saying, "This far, and no further. The Government are reducing our standard of living. We are exposed to increasing unemployment. We cannot tolerate a deliberate and successful attempt by the Government to reduce our standard of living."

Mr. Galbraith

The right hon. Lady. in her most interesting speech, has seemed to indicate that she did not approve of company profits. Will she explain how without company profits it is possible to invest in industry and how, without investment, we can get the greater growth which everyone wants?

Mrs. Hart

The best thing I can do in reply is to quote something that William Davis wrote in The Guardian on Saturday: When Harold Wilson was Prime Minister he once told me, with some bitterness, that the average company report reads something like this: 'The Government has got the country into a terrible mess, industry is fed up and depressed, there is no incentive to do anything, prospects are bleak—and our profits this year are 40 per cent. up.' My second point concerns a grave matter for Scotland, particularly for labour movement in Scotland. It must be made clear at this stage that as a result of what has happened in the last 18 months structural unemployment in Scotland is a problem which is likely to take years to cure. No one in Scotland can expect that any overnight miracle policies will be produced to cure the degree of structural unemployment, as distinct from economic unemployment, in Scotland. All of us on this side and all those whom we represent must realise that it will be a long and steady haul before the forces which the Government have unleashed to damage Scotland's economy are overtaken.

Even if the growth rates in Britain as a whole were to pick up considerably —not this year, I fear, despite the confident speeches being made by some Ministers, but perhaps next year or the year after that—Scotland would remain very far behind; our employment would not pick up to meet the situation of even two or three years' ago. To solve the problem, there will need to be massive injections of public finance and public enterprise. It will need the kind of thing which this Government are incapable of contemplating, but it will take a long time.

The Under-Secretary of State for Development, Scottish Office (Mr. George Younger)

The right hon. Lady has been making a very interesting speech about structural unemployment as opposed to economic unemployment. Since unemployment doubled between 1966 and 1970 under the previous Government. could she tell us whether that was structural or economic unemployment?

Mrs. Hart

In the first place the hon. Member's figures are quite wrong, and in the second place structural unemployment is endemic to the Scottish economy simply because it depends on old heavy industries. If they begin to decline, new ones must come in. During the period of the Labour Government we were keeping up with this; the injection of new industry was preventing an increase in structural unemployment. During the year and a half of this Government, they have totally failed to keep up, by means of injecting public capital, public finance and new industry, with the continuing decline in the heavy industries—shipbuilding, U.C.S. and so on.

Therefore, in this problem, one goes one step forward and two steps back, but if one does not take the one step forward, one's position is hopeless. The position in which this Government will leave Scotland in perhaps three or four years will take a long time to correct, however forcibly a Labour Government inject public capital and public enterprise.

Mr. John Rankin (Glasgow, Govan)

I am particularly interested in my right hon. Friend's speech because of my local circumstances. My right hon. Friend is talking as if there were a Scottish economy operating in Scotland and an English economy operating in England, and as if the English one was doing well, was rich, while the Scottish one was not. If my inference is correct, should we not be trying to achieve a United Kingdom economy in order to help the Scottish part of the United Kingdom?

Mrs. Hart

I am sure that what my hon. Friend means is that in order to resolve the structural employment problems of Scotland one must have as a base a high growth rate in the United Kingdom as a whole. I entirely agree. But even within that context the position of Scotland, in particular in relation to the rest of Great Britain, has been worsening and is still worsening.

I raised my point of order and have complained very strongly because we do not have a Minister from the Department of Trade and Industry on the Front Bench—although I understand from the Secretary of State for Scotland that there are Department of Trade and Industry officials listening to the debate. I regret the fact that no Ministers are present. There are, of course, even within the present economic context, certain policies which may be pursued or rejected by the Government. They largely relate to the Local Employment Acts, apart from the question of investment grants as against allowances. It is to aspects of these Acts that I want to devote two or three minutes.

The Secretary of State for Scotland (Mr. Gordon Campbell)

I want to make it clear that there is no discourtesy at all by my right hon. and hon. Friends from other Departments. This debate covers the fields of a large number of other Departments—for example, the Department of Employment, and also the Department of the Environment for ports and railways, as well as the Treasury and the Department of Trade and Industry. I have taken it upon myself as a member of the Cabinet to listen and to reply to all the points raised, but they will be referred to the Departments concerned.

Mrs. Hart

I am grateful for the right hon. Gentleman's assurance, but I believe that he made a mistake of judgment in not understanding that a Minister from the Department of Trade and Industry was the very least that was required in addition to himself on the Front Bench.

I refer back to Lesmahagow, the town in my constituency with 30 per cent. unemployment. Over the last five or six months, I have had no fewer than three individual meetings with the Under-Secretary of State for Trade and Industry and one meeting together with my colleagues from Lanarkshire County and my hon. Friend the Member for Motherwell (Mr. Lawson) on the question, either generalised or particular, of grants to firms seeking to open up in this town. The barriers which were put in their way have successfully prevented two firms and almost prevented one from proceeding.

I have found it totally incomprehensible that a Government which claim to be concerned about bringing industry into the worst affected unemployment areas of Scotland should persist in policies which deter industry from moving there.

I will not quote the names of firms, but I want to quote the three cases involved. The first was that of a firm in Glasgow engaged in the textile industry, which sought to expand, leaving its factory in Glasgow employing the same number of people but going into Lesmahagow, which then had 25 per cent. unemployment.

The Government's handbook, "Incentives for Industry in the Assisted Areas ", says: Broadly speaking, only new manufacturing projects being brought into a special development area qualify for these incentives. Expansion by firms already located in a special development area do not qualify. Lesmahagow was one of the two original special development areas in the West of Scotland. Because of the pit closure problem in the area, it and Sanquhar were two special development areas three years before this Government declared a larger area in the West a special development area.

During the time of the Labour Government the local colliery at Lesmahagow was kept open for a year and a half by two injections of the social subsidy that the Labour Government were providing to keep pits open because of special social circumstances. Therefore, when Lesmahagow as a special development area was absorbed in the wider area the acute problem of the town tended to get lost in the more general problem. The Government might have taken account of that fact, as might the D.T.I. in interpretation of its rules. But it is the rules themselves that I am talking about.

This question has been raised for six months by various bodies in Scotland, ranging from the Glasgow Chamber of Commerce and, to my knowledge, by the Lanarkshire County Council, and even by the Scottish Conservative Association. For six months the Government have had this under consideration and for six months nothing has been done. I wonder how many more jobs have been lost to the special development areas of the West of Scotland because of the Government's refusal to change their policy here.

I can only quote the case that I am quoting—this factory which did not come to Lesmahagow, which did not expand. The expansion has not taken place at all—it has not happened anywhere else. About 200 jobs have not been created because the grants were not available simply because the firm was already manufacturing within a special development area.

Mr. Tom McMillan (Glasgow, Central)

Is it not equally true that the system prevailing at the moment, with the standard grant and the operational grant, means that the local people cannot make a decision? A matter is recommended or otherwise and sent to London, where it goes into the deep freeze, before the company knows where it is going.

Mrs. Hart

I entirely agree. This is why I had three meetings with the Under-Secretary, because the matter got up to his level.

The second case was that of a London company which had some marginal interest in textiles. It wanted to move into Lesmahagow so as to be able to employ highly skilled personnel there. That company was not permitted to do so, this time not because of any difficulty about its already operating in a special development area but because it was a company with some marginal interest in the same trade. There, again, about 200 jobs were lost because the Department of Trade and Industry would not give the grants that are normally applicable in the special development areas.

The third case was that of a large United Kingdom combine which was not eligible for the special operational grant and for a long period of rent-free tenancy of a factory because, again, it had a marginal interest in the industry concerned. On that basis, I do not think that we would have had Linwood or Bathgate, because there are very few very large British companies which do not have marginal interests in most of the industrial sectors of our economy.

It will, therefore, be no good at the end of this debate for the Secretary of State for Scotland to say how much he regrets unemployment in Scotland and how much the Government are determined to increase investment, and do this and that, because it is within the power of the Government to make a minor amendment to the Local Employment Acts which this side of the House would guarantee to have through in a week. The right hon. Gentleman could then make sure that there was the expansion of industry in Scotland, emanating from those large combines or existing Scottish firms whose applications at the moment are refused by the D.T.I., thereby depriving Scotland of jobs which could have been created during the last six or 12 months. It seems to me that only if the Government indicate their concern by action can we regard the Secretary of State for Scotland as being sincere in what he says in reply to the debate.

5.3 p.m.

Mr. Edward Taylor (Glasgow, Cathcart)

We have so far had three interesting, constructive and telling speeches, and I hope that what I have to say will not upset this very desirable trend. If I may say so, those speeches have been appropriate to the seriousness of the unemployment problem in Scotland, presented to successive Governments since the war and which successive Governments have tackled or have been desperately fighting to reduce if not avoid. Up to 1966 we were in a position of gaining more jobs in Scotland than we were losing, but ever since we have been losing more jobs than we have been gaining.

This is, as the right hon. Lady the Member for Lanark (Mrs. Hart) said, a structural problem, and not one which could fairly, within recent periods, be laid at the doorstep of any particular Government. That being said, it would be wrong of me to start my speech without pointing out, as reference is made in the Motion to spending, and the like, that the amount of additional capital spending on schools, hospitals and roads which has been approved by the present Government is one of the largest we have ever had, and we should pay tribute to my right hon. Friend for what he has achieved in the Cabinet in fighting for such spending in order to create jobs.

Everyone knows that Scotland has been fighting, and is battling now, to stay an industrial country. The problem of the last few years has been no less than that, and my fear, and the fear which was expressed by the hon. Member for Glasgow, Springburn (Mr. Buchanan), is that the day may well come when Scotland will have a glorious future as a centre for agriculture, tourism, fishing, Harris tweed, Scotch whisky, and so on, while the future for the heavy industry on which we depend so vitally in the West of Scotland may not be bright at all. Part of the reason may be structural, but when we are faced with this kind of problem it is the duty of every Government to do everything possible to make sure that that does not happen in the West of Scotland, not only because of the human problem involved but because of the effect on the morale of an industrial country which wants to remain and should remain an industrial country.

Most important is investment. Irrespective of what our answers to the problem are, investment always helps to create jobs and to create confidence. But, for various reasons, many of them outwith Government direct control, there is at present uncertainty about the future of investment.

There are three great uncertainties. First, we do not know which areas will be designated as central by the Common Market Commission. The fact is that the Commission, in discussion with our own Government, will, as it has done for every other country in the Common Market, designate areas as central, within which it is not permitted to pay more than 20 per cent. towards the cost of each enterprise. That 20 per cent. is about, or perhaps just a little under, the amount of grant we can give in an intermediate area in Great Britain.

We do not know when the decision will be made. We do not know which areas will be designated as central. We have had an assurance from the Government—and I know that they believe it sincerely—that we shall be able to arrive at amicable arrangements with the European countries, but what we must know as soon as possible—or at least there must be a timetable—is when the designation of the central areas is to be fixed.

We must know whether it is likely, or possible, that the whole or most of Scotland will be designated as a central area. At present, almost all Scotland is a development area, and the small part of it that is not is an intermediate area. What we want to know, and what would help industry, is whether we have any guarantee that the Common Market Commission will agree to the whole of Scotland not being designated as a central area.

Secondly, what is the future for regional aids? We have been over all the business of Articles 92 and 93 of the Treaty of Rome, and how all new aids have to be submitted to the Commission and existing aids approved by the Commission. We have had an assurance from the Government that they believe that our existing aids will be permitted in the Common Market. We heard an equally strong point put by the hon. Member for Caithness and Sutherland (Mr. Maclennan) a little earlier that in his opinion investment allowances are not transferable and would therefore not be permitted once we were members of the Common Market. There is uncertainty. The only clear statement we have had was from the Common Market regional commissioner, who visited us about three years ago and said that he thought that everything was all right; and the opinion of the Government that existing aids were O.K.—

Mr. Rankin

On a point of order, Mr. Deputy Speaker. I myself have no objection whatsoever to the line which the hon. Gentleman is pursuing, but he is basing his argument on the effect on us of joining the Common Market. Who is present on the Government side to answer in respect of the Common Market with the authority that will satisfy the hon. Gentleman and all other hon. Members? Is there any such Minister present? If there is not, may we in fairness entertain this line of argument?

Mr. Deputy Speaker (Sir Robert Grant-Ferris)

It is quite customary, as the House knows, on Private Members' Motions to have a fairly wide debate. Nothing which the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor) has said so far can, I think, be deemed to be out of order. The House will also know that I cannot compel any Minister to be present.

Mr. Taylor

I should say that although on the Common Market issue I disagree fundamentally with my party, I have confidence in my right hon. Friend the Secretary of State for Scotland within the context of what it has been agreed to do for Scotland, and the fight for her best interests, otherwise I would not be putting these points to him. But we would like to know some time soon when we shall have a statement on which aids will be permitted. We are told that this will be done by joint discussion and perhaps by agreement, but at some stage the Common Market Commission will have to decide one way or the other on things like regional employment premium, investment allowances, and so on. Whether the decision is for us or against us, it would help investment decisions in Scotland very greatly if we knew when that decision was to be taken, and if we knew what the decision would be.

The third question relating to investment is the great question of investment grants and allowances. For the normal prosperous firm there is little to choose in cash terms between allowances and grants. With free depreciation, it is possible that investment allowances might be just a little better. But, on the other hand, for new firms setting up, and for unsuccessful firms not making profits, the grants would be of great benefit. Apart from that, there is some evidence that the sheer psychological effect of investment grants and of getting cash in one's hand, as opposed to allowances, is perhaps considerable. I do not have the knowledge to say whether grants or allowances are preferable, but I am sure that the hon. Member for Lanarkshire, North (Mr. John Smith) will have that knowledge. He usually does.

Mr. John Smith (Lanarkshire, North)

I am able to assist the hon. Gentleman. I draw his attention to an article in The Guardian of 20th October, 1971. Mr. John Rhodes, a research officer of the Department of Applied Economics at Cambridge, points to the relative value of investment grants against investment allowances as showing a differential value incentive of 12.2 per cent. for investment grants as against 2.8 per cent, for investment allowances and showing that this change has reduced the differential attraction by six times.

Mr. Taylor

If the right hon. Gentleman would look at other aspects of the matter, including building grants and free depreciation, he would find that the equation is not as simple as that, when looking at the whole package. But despite the excellent views of The Guardian and the hon. Gentleman's deep knowledge of them, we are entitled to ask that some high-powered study be made of whether allowances or grants are better, and then for a decision to be made. My inclination is that there might well be a case, psychologically in any event, for saying that grants might be a help to morale in Scotland at present.

Secondly, on the question rightly raised by the hon. Member for Glasgow, Springburn regarding the dispersal of administration, my right hon. Friend the Prime Minister has commissioned an inquiry into the dispersal of Government offices. I am open to correction but I believe that over 100,000 jobs are under consideration in one way or another. I understand that the results of the report will be given to my right hon. Friend towards the end of next year. On the other hand, while progress can be made with the dispersal of Government offices, it would be a great help if within that review the whole question of the administration of the nationalised industries could be considered.

Some of us have been greatly concerned that, while the Government have been looking at ways in which they can attract Government offices to Scotland, the nationalised industries seem to be operating against that policy. We had the recent example of the tubes division of the British Steel Corporation moving from Glasgow. That decision was taken by the Steel Corporation. We have recently discussed in the House a new Gas Bill to set up a British Gas Authority. The old Scottish Gas Board and the regional gas boards will be replaced. Will this mean a centralisation of jobs? Will the authorities say that there will be fewer jobs but that natural wastage and the like will enter into it?

With so many movements like this, it would be an enormous help, with this inquiry into the dispersal of Government offices, to consider the question of the centralisation of the nationalised industries. We have the Gas Bill centralising gas. I recently asked whether this would mean uniform prices for gas as we shall now have a gas authority. Although this will be subject to the Common Market, we shall have a uniform price for steel. I was told that gas prices were a matter for the gas authority. It seems likely that, as in the present situation, Scottish domestic gas consumers will pay on average 25 per cent. more than those in England and Wales. This matter seriously affects Scotland.

The worst possible example on the question of dispersal is the Steel Corporation. I remember being present, with the hon. Member for Bothwell (Mr. James Hamilton), when the steel nationalisation Bill was being discussed. I and some hon. Members of the Labour Party were desperately concerned that, like other nationalised industries, the Steel Corporation would establish a major headquarters in London. For the first time with a nationalised industry, we inserted into the Bill a Clause putting an obligation on the Steel Corporation to have regard to the need to disperse its offices and to locate them near manufacturing. But what has happened? We have established a giant colossus of administration for the steel industry in the centre of London, miles away from the steelworks. That is one case. There are other cases in which we could have a nationalised industry's headquarters outside London. The steel industry has not been very successful. It has lost a great deal of money. It would save cash if it moved its headquarters away from London to somewhere else in Britain.

My next point is on the question raised very ably by the right hon. Member for Lanark about grants and S.D.A.s. We all know that local industries setting up new businesses get very substantial grants, the normal grants for a development area. On the other hand, the S.D.A. is an extra bonus. We have rent-free accommodation for three years, and assistance with the wages bill for six months. It is anomalous that firms doing identical jobs in identical premises can be discriminated against just because they are local firms considering expansion. I am fully aware of the arguments advanced in support of the present situation. It is suggested, for example, that firms moving into an unfamiliar environment require extra assistance, and this is of great help to them. But we also know that many international and British firms who are considering expansion in this way have more experience about the problems of relocation than small local firms which are thinking of setting up for the first time, as it were, in the big time. There is a case for considering giving these grants to all firms expanding in S.D.A. areas, even if this did not have a massive immediate effect on jobs. Many local firms resent this and give it as their reason for not expanding.

Apart from that, if movement cannot be made along those lines, I hope that something can be done about the many delays which appear to occur, at least in the minds of some of my industrial friends. I have written to the Department of Trade and Industry about two cases. There is long delay in considering operational grants under the S.D.A. arrangements. Much of this delay is because the Department is anxious to give the benefit of the doubt to marginal cases. If there is doubt, no doubt the Department would rather take the extra week or two, or perhaps a month, to consider the case, so that the firm can be given the grant if possible. But delays are holding up investment.

As the hon. Member for Springburn said, Hunterston is crucial to the west of Scotland. There was a general delight in the west of Scotland at the announcement of the ore terminal. If we are to have a steelworks, the ore terminal is necessary beforehand. Precisely where do things stand on the Hunterston front? On 31st January asked the Secretary of State a Question whether he had received the report of the joint steering group on the steel industry. I tie reply was: I have nothing to add to the answer given to the hon. Member for Sheffield, Attercliffe (Mr. Duffy)… on 17th January."—[OFFICIAL REPORT, 31st January, 1972; Vol. 830, c. 11.] I looked that up. The reply there was that he had nothing to add to the statement given by the Minister during an earlier debate on 16th December. I looked up the debate. He said: We expect this review to be completed—as announced last summer—around the end of the year, and it should be possible to make a further statement shortly after the House re-assembles."—[OFFICIAL REPORT, 16th December, 1971; Vol. 828, c. 864.] It would help to know how things stand with Hunterston. What is the timetable? I recall that in the annual report of the British Steel Corporation in July it was stated that the long-term investment plans had been submitted to the Government and included a green field site in an area not yet designated. We understand that since then a joint steering group has gone into action and is now discussing what should be the long-term investment plans of the B.S.C. It would be helpful to know what stage we have reached—whether the plans have been submitted, whether the report of the joint steering group has been received and, if it has, when a statement about it will be made, and when we may have more news of this exciting and ambitious project.

There is little point in going again over the arguments for Hunterston. At Le Havre, Versailles, Antwerp and similar ports in Europe millions of pounds and even hundreds of millions of pounds are being spent to create the very circumstances which the Clyde has been given by nature as a great national asset. We know that there are great advantages in such a scheme. On the other hand, it would be interesting to know precisely what will happen when and if the Government get their port. Will the B.S.C. itself put forward a positive suggestion? Will it be necessary to get the approval or agreement of the E.C.S.C. before we make a decision?

Another crucial factor on which Scotland has no indication is the pricing policy of the steel industry in the event of our joining E.C.S.C. We know that in Europe the general policy is to have a basing point for each major supplier and we know that by and large suppliers have to charge basing point price plus transport costs. That is the general rule apart from the special arrangement of aligning which is made for Italy, to cope with the regional problems there. It would be helpful to know whether there is to be just one basing point or several for Britain. If there are to be several, will the prices of steel be uniform at all basing points, or will there be regional economic prices? If there are to be regional economic prices, the Scottish price, as with gas and coal, will inevitably be much higher, and that will be very serious.

What is more important is that if we have regional pricing, or if the B.S.C. decides to go for regional prices, as it wished at one time, it is clear beyond a shadow of doubt that once we are in the E.C.S.C., the Government will not be able to stop the Corporation from doing so, or to influence it. It will be a decision which the Corporation will have to take in consultation with the E.C.S.C. That shows how vital it is for Scotland that we should have a source of cheap locally produced steel.

If, as I believe, Scotland is fighting a battle to remain an industrial nation, we have to have as sure a guarantee as we can get of our ability to obtain steel at a competitive price, if not at a very cheap price. Even with joining the E.C.S.C. and all that that means, we can still have steel at reasonable prices in Scotland if we make it easy for the industry to go ahead and to contemplate expansion and investment.

My hon. Friend the Member for Galloway referred to labour relations as a significant factor in Scotland's problems. It was particularly regrettable that we should have had a strike at Yarrows on the very day that industrialists were visiting the country to consider expansion on Clydebank. The unions could do much to improve the image of Scotland. As my hon. Friend said, this situation applies to only a few industries. Employers, too, could do a great deal.

Many hon. Members find but little sympathy with those employers who seem to create trouble for themselves. Some complain bitterly about irresponsible shop stewards causing disruption and strikes and forcing employers to break contracts and so on. But it is often the very same employers who turn down wage demands from the official trade union leaders only, after a strike of two weeks, to concede the claim of militant shop stewards of whose conduct they have complained. Plainly, there needs to be more effort by the trade unions and by employers to improve labour relations and to change attitudes and to appreciate that strikes will continue so long as striking pays. Many employers in Scotland—and I am thinking of two major industries—have created much of the trouble for themselves.

I seem to have spoken for far too long. I am sorry to have done so and I hope that what I have said has not been too boring. I hope that my right hon. Friend will at least read what I have said.

5.26 p.m.

Mr. Russell Johnston (Inverness)

I join those who have congratulated the hon. Member for Glasgow, Springburn (Mr. Buchanan) on introducing this relevant and excellent Motion and on speaking to it so well. In the time available it is impossible properly to analyse the complicated nature of the present grim unemployment figures, or to advance any solutions in depth. I realise that in picking four subjects I shall not find it possible to deal with many others and that inevitably I shall over-simplify and perhaps not fully develop my arguments. In particular one has to economise on vital issues such as Europe and the internationalisation of companies, although their effect on unemployment is direct and considerable.

I first take public works. There is no doubt that this is the one area in which the Government can quickly and directly affect unemployment. The increase in the public works programme which was authorised last summer was welcome, but was it enough? Were the consents given with sufficient urgency? Was the scheme itself clear?

My hon. Friend the Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) asked the Secretary of State about this subject on 2nd February and elicited the information that out of £100 million worth of applications £27 million were not authorised. That is a fairly large chunk, and that must mean that either there was delay in giving consents, or some muddle about what entitled a consent to be given.

Mr. Gordon Campbell

May I deal with that at once? This was a programme to be started and largely completed by March, 1973, which is just over a year ahead. A number of proposals were made which in the event could not meet that criterion, although they were genuinely made with the hope that they could.

Mr. Johnston

I am simply surprised that so many applications, £27 million worth, failed to meet the criteria. There must have been confusion about what the criteria were. There may be a good fiscal reason for choosing March, 1973, but I do not know of any and I should have thought that there was some justification for extending the period.

The hon. Member for Springburn dealt at length with regional unemployment. I find the statistics for my own area immensely depressing. The average of unemployment in the Highland planning region for this year was considerably higher than that 10 years ago. In 1971 it was 87.7 per cent. whereas in 1961 it was 6.7 per cent; so there has been a 2 per cent. increase. It was even more marked with male unemployment. In 1961 the figure was 7.6 per cent. Last year it was 11.1 per cent., a frightening total.

I have never thought that the job of the Highlands and Islands Development Board was one of containment. It is or should be one of development. I thought the letter from the Chairman of the Board, Sir Andrew Gilchrist, which appeared in the Scotsman last month was rather extraordinary. He said that the Board could use more money but then went on: There is a limit … the excessive injection of capital into an area of small resources can swiftly lead to overheating and social distortion with unfortunate consequences. Such distortion is an inevitable corollary of success. He then instanced Shetland and said: Shetland at this moment has probably reached the point of being, if not overheated, over buoyant. I can assure him that this is certainly not the view of my right hon. Friend the Member for Orkney and Shetland (Mr. Grimond). I am not worried about overheating but rather about under-firing. I am also worried about the differential which is now nothing like what it was.

It is the unemployment in the Central belt which is most serious, because of its size and nature. I do not want to labour the points already made by the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor) on Hunterston or the reshaping of our shipbuilding industry and Oceanspan, or the points which the hon. Member for Glasgow, Springburn made about the refurbishment of our decaying industrial areas. The Secretary of State would do well to pay attention to what the hon. Member for Galloway (Mr. Brewis) said about R.E.P. I am not certain that I agree with his references to industrial development certificates.

The third point I seek to raise concerns oil. The House will know that Liberals have proposed the establishment of a development corporation funded from a share of oil royalties and from moneys from the auction of the development sites. Others have made similar proposals to the Secretary of State. The right hon. Gentleman is visiting Aviemore in my constituency on 24th and 25th February to attend a conference organised by the Scottish Council. I hope that when he goes he will take his top officials with him and will pay close attention to what is said, because I believe there is now a pretty general consensus in Scotland that there should be a definite earmarked share of this found money coming directly into Scottish investment.

The oil boom will reflect itself, as it has already in areas of the North-East, in other direct and indirect ways. There are more things of which the Government should be thinking, such as bringing pressure to bear on the oil companies to develop their installations in particular parts of the country.

Dr. J. Dickson Mabon (Greenock)

The Secretary of State will obviously object to the hon. Gentleman's last proposal about oil revenues on what are called classical fiscal grounds. I think he has once employed this defence in public but many times in private. Since the hon. Gentleman will find his proposal rejected on that ground—he knows the argument as well as I do—is he attracted by the proposal of my hon. Friend the Member for Stockton-on-Tees (Mr. William Rodgers) in his Regional Development Corporation Bill which may come before the House on Friday? How do Liberals react to that?

Mr. Johnston

It is an attractive proposal. I would like to go further but I am prepared to take portions of cake rather than no cake. The classical argument has already been advanced by the hon. Member for Cirencester and Tewkesbury (Mr. Ridley), who is very classical in all these matters.

Mr. Gordon Campbell

I do not wish to raise objections on any classical grounds. There are practical problems. Would the hon. Gentleman suggest that Scotland should repay a notional share of the royalties from North Sea gas which has been coming from areas under the sea opposite England? These royalties are coming in now. Are we to start paying for them on the basis that we may get something in future?

Mr. Johnston

There is no great argument in principle about this. The essential thing is that here we have something new and the opportunity to treat it in a different, new way. There are logical arguments about whisky and all the rest, but I do not think they are relevant. The relevant thing is that this is an opportunity to do something new directly to channel money into the Scottish economy without putting any new strain on the Exchequer.

Fourthly, since the Secretary of State looks with some suspicion on new ideas, may I throw out a small, new idea—something about which Scottish Liberals have been thinking and which may help to tackle some of the environmental problems on which the hon. Member for Glasgow, Springburn laid such emphasis. Is it possible to introduce legislation empowering local authorities to take on unemployed people at the normal rate for the job and reclaim from the Government the money which that person would have received if he had still been unemployed? There are many administrative objections. We would have to create a new temporary category but at least there are lots of things that local authorities want to do.

There is the point which the right hon. Lady the Member for Lanark (Mrs. Hart) made in an interesting but rather long-winded speech about the percentages of unemployed unskilled and semiskilled persons. Here again there is an opportunity for them to do work without necessarily placing an extra financial burden on the Government. Many people have pointed out that we are paying at least £10 on average per week per person throughout the United Kingdom. That is £520 million a year. We could be using the skills of these people. It would be a way of helping local authorities to do many of the things they wish to do, such as building new roads, new buildings, fresh work in social work departments and so on.

I agree very much with the hon. Member for Glasgow, Springburn that unemployment is a waste and an affront. If we in Parliament fail to face up to it and overcome it we are failing in our most primary duty.

5.37 p.m.

Mr. David Lambie (Ayrshire, Central)

I found myself agreeing with much of what the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor) said. We are dealing not just with Scottish unemployment but rather with the industrial future of Scotland. During the last 140 years we have seen the Scottish economy changing. We had the clearances, when the crofting economy of Scotland was radically changed to make way for sheep farming and hunting interests. The crofters were forced to leave the land and move into the industrial areas. Today we are seeing the end of industrial Scotland, the Scotland that most of us on these benches have known nearly all our lives. Unless something is done quickly we shall be dealing not with an industrial Scotland but with a Scotland whose future lies in hunting, shooting and fishing. Scotland will be the area in Europe where people from the rich industrial areas of England and the Continent spend their holidays and enjoy these pursuits.

Some of the major factors affecting Scotland's industrial future have not been mentioned today, and I should like to deal with two of them. First, in my constituency and throughout central Scotland factories belonging to major concerns centred mainly in England are gradually being closed. They are not only private enterprise factories but, unfortunately, the premises of nationalised industries. Those of us who during our political lives have supported the principle of nationalisation are finding that this principle is being used as an excuse to close small industries in our constituencies and in central Scotland, but it is mainly because the people in control of the nationalised industries are English-based and have very little knowledge of the outlook of Scottish people or of conditions in Scotland.

My hon. Friend the Member for Spring-burn (Mr. Buchanan) referred to British Rail (Engineering) Limited, which is closing the railway workshops in Barassie, in my constituency, not because they are the "lame ducks" of the Secretary of State for Trade and Industry, or because they are not viable, or because they have not met production targets, but in order to fit in to the general rationalisation programme to centralise the wagon repair units in areas of England where a profit is not being made. Neither the 480 people who work in the Barassie railway workshops nor I can understand why the works should be closed and these 480 jobs transferred to major railway engineering centres in England.

In another part of my constituency the closure of the Baelz Equipment Company Limited, whose parent company is in Wolverhampton, in the Midlands of England, was announced last week. This concern came to Scotland in the early part of 1959 and, according to my information, has been working at a profit ever since. According to the latest reports, the company has enough work to keep it going for the next two or three years, but, because of difficulties with the parent company in Wolverhampton, it has been decided to close the factory, which is in an area where unemployment is already high.

I have received a distressing letter from the District Clerk of the Irvine District Council in which he says: I need not stress the effect which this depressing news"— that is, the closing of the factory of Baelz Equipment Company Limited— is making on my Council and in the community in general particularly at a time when the incidence of unemployment has reached unacceptable proportions and when the outlook for the future is anything but promising. My Council would hope that since this industrial estate is within the control of a Government Department you will be able to attract immediate and special consideration to this problem. I ask the Secretary of State for Scotland to deal, in his reply, with the problem of units of firms, whether nationalised or private, which are profitable and viable being forced to close because of reorganisation in the concern in England.

Mr. Gavin Strang (Edinburgh, East)

Some hon. Members opposite have the impression that my hon. Friend is arguing against nationalisation. Does he agree that the great advantage of publicly-owned industry is that the Government can change the policy tomorrow, whereas a large section of industry is owned by private enterprise and it is very much harder to change the policy?

Mr. Lambie

I agree. But we do not have a Labour Government. Unfortunately, the Conservative Government have control of the future of Scotland, and they have shown no consideration for Scottish interests.

Mr. Brewis

rose

Mr. Lambie

I am sorry; I have not time to give way. I propose to continue with my speech in order to give more time for other hon. Members to speak.

I wish to draw to the attention of the Secretary of State the question of the future of the Glengarnock steel works in my constituency. In the last year or so we have been told that the British Steel Corporation proposes to centre future rail production in two areas, one being at the Glengarnock steel works. Suddenly, like a bolt from the blue when, at the beginning of this year, we saw the future plans for the next quarter, we discovered that the weekly production target for the steel works had dropped from 1,600 to 600 tons of rail per week and that the other 1,000 tons of production was to be transferred to the Cargo Fleet works in the North-East of England. According to the workers and management at the Glengarnock steel works, a unit which has met its target and been profitable for the last 20 or 30 years is being forced, because of rationalisation in the B.S.C., to lose 1,000 tons of steel rail production.

Hon. Members today have said that they were happy when they heard the announcement by the Secretary of State last week of the go-ahead for the iron ore terminal at Hunterston. In fact, the decision by the Secretary of State to give approval to the proposal to build an iron ore terminal and deep water port at Hunterston was given, not last week, but at the beginning of December, 1970. On 19th December, 1970, Mr. A. G. McCrae, Chairman of the Clyde Port Authority, is quoted as having said: We are naturally delighted at the Secretary of State's decision. This confirms our confidence in the Clyde as one of the nation's great ports. When I heard the Secretary of State's announcement, I got in touch with the Under-Secretary of State for the Environment and asked what was the Government's attitude to the terminal at Hunterston. He said in an answer to me on 16th December, 1970, that the Government would give every encouragement to any proposal to build an iron ore terminal at Hunterston. On 16th March, 1971, following an inquiry from me as a result of articles in the Glasgow Herald, I received a letter from the same Under-Secretary of State saying that the Clyde Port Authority had never envisaged raising money for Hunterston on the open market; it had always been the intention to seek a Government loan. In the same letter he said that the Clyde Port Authority and the British Steel Corporation were discussing with each other the commercial terms on which an iron ore terminal might be built but that no authorisation for such a scheme had been sought from the Secretary of State for the Environment. Therefore, on 16th March, 1971, the Clyde Port Authority and the B.S.C. were in negotiation about the commercial terms on which an iron ore terminal might be built in the Hunterston area.

In June, 1971, two provisional orders were published by the Clyde Port Authority for presentation to Parliament to clear the way for the construction of the iron ore terminal at Hunterston. When those two provisional orders were published people who had objected to the industrialisation at Hunterston, the North Ayrshire Coast Protection Committee, said they would object to the provisional orders and would use the rest of the money which they had collected in their initial campaign to fight to the nail the provisional orders.

On 10th November, 1971, I put a Question to the Secretary of State for Trade and Industry whether he could announce the starting date of the proposed new iron ore terminal at Hunterston, and the Under-Secretary in reply said: No; the choice of Hunterston as a possible location is one for the British Steel Corporation in the first instance and I understand that it still has the matter under consideration."—[OFFICIAL REPORT, 10th November, 1971; Vol. 825, c. 187.] That was more than six months after I had been told by another Minister that the Clyde Port Authority and the British Steel Corporation were in negotiation.

The whole story of Hunterston has been a story of delay after delay. If one had stayed in Scotland and read only Scottish newspapers one might have concluded that that terminal had been built four or five times over. Unfortunately, the majority of people who take decisions in this country do not stay in Scotland but are down here in London where they have no concern at all about what is going on in other areas, whether in Wales, the North-East or North-West of England, the North-East or the North-West of Scotland. Their only concern is centred in London where the power lies.

We have now had this great announcement last week by the Secretary of State. Unfortunately I did not hear his announcement because at the time when he was making it on the Floor of the House I was meeting elsewhere in the building a deputation from the Barassie railway workshops. The people in that deputation appealed to me as their Member of Parliament, "What can you do to retain Barassie's railway workshops?" When the Secretary of State made his announcement every Scottish newspaper and most Members here, even on my own side of the House, shouted, "Hurrah. We have now got Hunterston." I have been too long on the Hunterston campaign to accept any announcement about Hunterston and about the great development at Hunterston till I have seen the first dredger there and the first construction worker there working on the iron ore terminal and the deep water port.

When I got home last weekend I was blamed for being too pessimistic. "You are always on the losing side, David," I was told. "You have been handed this announcement. Do not antagonise the Secretary of State and people making the decisions. They have the interests of Scotland at heart." But the Secretary of State did not announce that the Government would give the money to finance the iron ore terminal, and I ask that when he winds up tonight he will tell us how much of the £26 million the Government are prepared to give.

When at first the terminal was spoken of we were told it would cost £15 million, with £8 million from the Clyde Port Authority, which has at present very little available money, and £7 million from the British Steel Corporation. Now they talk of a figure of between £26 million and £27 million. Who is to finance it? If the Secretary of State announces today that the Government will give £26 million either indirectly through the British Steel Corporation or directly through the Clyde Port Authority I will withdraw my claim that we have again been discriminated against in Scotland and I will praise him, but if he does not make that announcement I am afraid that, with the history which I have pointed out, we must accept that he is insincere and that the Government are insincere in their ideas about the future of the Hunterston area.

I have always made the case that the iron ore terminal does not automatically mean the green field integrated site we in Scotland are waiting for at Hunterston or that, therefore, an announcement about the green field site would mean an iron ore terminal. Unfortunately we have been fighting amongst ourselves in Scotland. There have been those of us awaiting a big steel development at Hunterston and, quite rightly from their point of view, others who have wanted to see a continuation of the steel industry in Lanarkshire. I put it to hon. Members, that we are not going to get any green field site in Britain—

Mr. George Lawson (Motherwell)

There was never an argument for development at Hunterston versus the retention of the industry in Lanarkshire. It was an argument on priorities, and that if the ore terminal could be obtained it would be possible that other things could follow the ore terminal, but that the ore terminal was essential in any case. That was the argument. It was not a question of one against the other.

Mr. Lambie

I accept the point made by my hon. Friend but I continue with my original contention that at the beginning of the Hunterston campaign there was this division between people who were supporting the new development in the green field site and those who wanted a continuation of development on the so-called brown field site.

I would put it to hon. Members that we shall not get the iron ore terminal, we shall not get the green field steel site in Scotland, or in any other area in Britain, because the Government will not give the British Steel Corporation the necessary finance to allow it to get up to an annual production target of £42 million which the Labour Government set, and that this is because—and here I agree with the hon. Member for Cathcart—we have decided to enter the European Common Market, so that we can no longer look at the future of the British Steel Corporation in isolation.

We have to look at the future of the corporation as part of the European Iron and Steel Community. When we do that we do not just read the Scottish newspapers about the future—the golden future for Scottish industry. Nor do we read British newspapers only. We have to read international papers to see the steel scene at the moment. My hon. Friend the Member for Glasgow, Scotstoun (Mr. Small) drew to my attention a report in the American magazine Fortune for January this year. Dealing with the present position of the steel industry in the world it said: Signs of increasing multinational investment are already apparent. Hoogovens, the Dutch company, is expected soon to merge with Hoesch of Germany, forming the Continent's second-largest steel company… The European Coal and Steel Community is urging more cross-border cooperation. It points out that a modern plant capable of producing eight million tons a year would require an investment equal to twice the cash flow of the Community's eight largest companies. This is the problem which the British Steel Corporation is facing. The magazine Fortune goes on to say: The urgency of international joint ventures is perhaps most striking in the case of beleaguered British Steel Corporation, which lost an estimated $250 million in 1971. In desperate need of efficient capacity, the nationalised company has approached Hoogovens, Usinor of France, and a German company with joint-venture proposals. British steel has one of two projects in mind—an expansion of its Teesside plant on the north-east coast or a big plant on a new site on the Thames Estuary (or possibly on the Continent) that could produce 15 million tons a year. I ask the Under-Secretary of State to deny these international reports that the British Steel Corporation is considering bringing in foreign capital to help it out of its cash difficulties and also putting future British steel capacity not in Scotland or England but on the mainland of Europe.

These are important points that must be answered tonight. These are the things that will decide whether Scotland will remain an industrial country. If we get the green field development at Hunterston we shall be ensured of an industrial future. If we do not get it we shall have an environment empty of everything but sheep and cattle.

6.1 p.m.

Mr. Iain Sproat (Aberdeen, South)

It is with great pleasure that I intervene in the debate which was opened in such a fair-minded, constructive manner by the hon. Member for Springburn (Mr. Buchanan). Apart from one or two small departures, the tone which he set for the debate has been followed by all hon. Members who have spoken.

Like all hon. Members who have spoken, I regard the Scottish ecenomy with grave concern. I think we all recognise that the hideous unemployment figures in Scotland hang like a pall over us as we debate the situation this afternoon. Unemployment is a personal and overall social waste and an economic waste. I am sorry the hon. Member for Inverness (Mr. Russell Johnston) has left the Chamber. I thought he was rather too modest in his approach to the problem. Since we have had contributions from one hon. Member lasting 25 minutes and from another hon. Member lasting half an hour, the hon. Member for Inverness could perhaps have said a little more about the Liberal proposals on oil, which vitally affect North-East Scotland.

Although I regard the position as extremely serious, I do not regard it as one of despair or despondency for Scotland. My remark may ring strangely in the context of the debate, but having thought long and deeply, I believe that the prospects now before Scotland, once we have got out of this present trough, can scarcely ever have been brighter. I will not use the word "boom". In his useful contribution to the unemployment debate last week my hon. Friend the Member for Perth and East Perthshire (Mr. MacArthur) said that "boom" implied something which was short-lived. That should not be the impression we convey. This is not a question of a short-lived boom. Scotland's opportunities, if she will seize them, will stretch into the future as far ahead as we can see, and certainly as far ahead as we can plan.

There are two main reasons for my confidence in the future of Scotland. First, the Government have a coherent and long-range strategy for the Scottish economy, as indeed for the United Kingdom as a whole, of which Scotland is an integrated part. As we can see from the evidence, this strategy is working. We must not let our minds be totally blinded by the appalling unemployment figures—[Laughter.]—it is all very well for hon. Gentlemen opposite to laugh, but if we look at other parts of the Government's economic strategy—

Mr. Tom McMillan

rose—

Mr. Sproat

No, I cannot give way, I want to get through my speech as quickly as possible. When the Government took office they were faced with four sets of rising figures—wage rates, prices, strikes, unemployment. Of those four, only one figure is still continuing to rise at a comparable rate, and that is unemployment. [HON. MEMBERS: "Rubbish."] It is no use saying "rubbish". A year ago wage rises were running at 14 or 15 per cent.; now they are between 7 and 8 per cent. A year ago prices were rising at the rate of 11 per cent.; now the rise is 5.6 per cent. Similarly, the number of strikes has been cut dramatically. Although the situation is not satisfactory, these are genuine indications that our economic strategy is beginning to work and will begin to bite on the appalling unemployment figures in the spring.

Mr. Ewing

rose—

Mr. Sproat

I am sorry, I have been asked to get through my speech quickly, as one or two other hon. Members opposite wish to speak.

In the Labour Government's infamous document "Scottish Economy, 1965–70" they promised an extra 50,000 to 60,000 jobs for Scotland. By the time the Labour Government had departed, 82.000 jobs had been lost. In other words, the Labour Government were out in their calculations by almost the unemployment figure for Scotland now.

I entirely agree with my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward Taylor), and also with the hon. Member for Central Ayrshire (Mr. Lambie) on the danger of Scotland disappearing as an industrial power. We must fight this danger.

The Labour Government went too far the other way. By the introduction of selective employment tax they legislated against the service industries. There seems to be an industrial puritanism—and it came out this afternoon—which says that someone who manufactures something with his hands and makes money in this way for the country is somehow better than a person who is employed in the service industries. This is an incredibly old-fashioned and reactionary attitude which, for Scotland's sake, we must get rid of.

To turn briefly to the immediate and.short-term problem, no Government in history has pumped so much money in such a short time into our economy.

Mr. Lambie

Or created so much unemployment.

Mr. Sproat

Under the Labour Government unemployment in Scotland doubled.

Out of the £160 million for advanced public works, Scotland's generous share is £65 million. If the Scottish Nationalist Member were here I would ask him to remember that next time he says that Scotland does not get a fair deal from the Treasury. A sum of £100 million has been allocated to advanced State Board expenditure; naval expenditure, £80 million; house improvement grants, £53 million; aircraft building, £23 million; National Health Service improvements, £33 million; repayment of post-war credits, £130 million; £1 million per year has been allocated for the five-year environmental improvement of Glasgow and a further £1 million for the environmental improvement of West Central Scotland.

Have the Government made any estimate of the number of jobs for which they are directly responsible which these measures will create? I realise that the Government cannot have such an estimate for the number of local authority jobs which will be created.

The next section of the Government's strategy, which has not so far been much commented on, is that of stimulating the Scottish economy. By and large, only growth in the United Kingdom economy will produce growth in the Scottish economy. However much we dislike this, it is an economic fact of life. It is worth emphasising how much the Government have done to encourage and stimulate growth in the United Kingdom economy. There have been cuts in income tax, cuts in purchase tax, cuts in selective employment tax, and cuts in corporation tax. These cuts in taxation by the present Government have amounted to some £1,400 million. In addition, we have seen cuts in interest rates and the abolition of hire-purchase controls. Already this is having an effect.

I am glad to see that the right hon. Member for Lanark (Mrs. Hart) has returned at last to the Chamber. She said that these measures were not having an effect and gave the impression that the economy will grow this year, next year or some time, perhaps never. But I would remind her that the economy is already growing at double the rate it did under the Labour Government, and I believe it will continue to grow.

We have not seen the amount of investment we would like. This matter has been dealt with by my hon. Friend the Member for Glasgow, Cathcart, and I will not go into it extensively, save to say that I believe investment is growing and that if we get another expansionist confidence-making Budget, which I trust we shall have, it will continue to grow.

Furthermore, in the long term the Housing Finance Bill which we are putting through the House at the moment—

Mr. Lawson

The "welshing" Bill.

Mr. Sproat

I hope the hon. Member for Motherwell (Mr. Lawson) will not go on saying "welshing", as he has said interminably in Committee. We have in Scotland the worst slums and the worst overcrowding in Great Britain, and the worst record of owner-occupancy.

Mr. Ewing

On a point of order, Mr. Speaker. I should be grateful for your guidance. The hon. Member has had ample opportunity in Committee on the Housing Finance Bill to make all the points he wishes to make about unemployment, but he has refrained from making them.

Mr. Speaker

Order. One right hon. Lady spoke for 31 minutes. Another hon. Member spoke for 24 minutes. I am anxious that the hon. Member for Glasgow, Pollock (Mr. James White) should have a few minutes before I call on the right hon. Member for Kilmarnock (Mr. Ross). All these interventions, sedentary or otherwise, take time.

Mr. Maclennan

On a point of order, Mr. Speaker. In view of your anxiety to call as many speakers as possible, may I point to the desirability of maintaining some kind of geographical balance in this debate, since so far from the Opposition benches every speaker has represented the West Central region. There has been no spokesman from Edinburgh, or from the Highlands or Tayside. This is beginning to cause considerable annoyance on these benches.

Mr. Speaker

I apologise to the hon. Gentleman. I had hoped that speeches would be much shorter. I had arranged that there should be a geographical spread for the debate, but I expected that hon. Members would keep their contributions to a more reasonable length.

Mr. Sproat

I will try to get through my speech as quickly as I can. The Housing Finance Bill will in the long term benefit the Scottish economy, as will the Industrial Relations Act. It would be interesting to know how many companies which otherwise would have come to Scotland decide not to come to Scotland because of the appalling number of strikes—in certain parts of Scotland, not all—and bad industrial relations. These people do a great disservice to Scotland.

Mr. James Hamilton

It is unfair that the hon. Member should make such statements.

Mr. Sproat

In addition, we are now presented with an extraordinary package compounded partly of luck, partly of policy. We have the glittering package of Hunterston, Oceanspan, North Sea oil and the Common Market. I do not intend to go into these matters because of the time factor and also because many of them have already been covered. On the question of North Sea oil, which is a matter of great importance to my constituency, I feel that it is wrong for people to talk merely of Scotland getting part of the royalties. These royalties are as nothing by comparison with the money which will be spent in Scotland in servicing, construction and hardware. Scotland must seize the opportunity to get some of the oil revenues for Scotland, but it must stop worrying about the percentage it will get of oil royalties. In view of all the policies which are being pursued by the Government, I believe that Scotland's future is bright indeed if only Scotland will seize its opportunities.

6.16 p.m.

Mr. James White (Glasgow, Pollok)

I had intended to be brief, but I did not think that I should have to be as brief as five minutes. I will have to throw away half of my speech, and I know from experience that it is always the better half.

I was interested to hear my hon. Friend the Member for Glasgow, Springburn (Mr. Buchanan) refer to his early life. It was unemployment and the first war that brought me into the Labour Party and gave me my interest in politics. I remember my father leaving the house between five and six every morning trying to sell his labour on the Clydeside; he did the rounds of all the yards and dry docks. I remember him telling me that he often used to take a different road home after these days of job-hunting just to avoid running into me when I was on my way home from school. This is the human side of unemployment which I want to emphasise to the Government.

My right hon. Friend the Member for Lanark (Mrs. Hart) referred to what would happen when the wage-related earnings finished. Once this happens people will begin to live in poverty. I know a lot who are on the borderline just now. Therefore, I was surprised to hear the hon. Member for Aberdeen, South (Mr. Sproat) speak of Scotland as though it were the land of Canaan, flowing with milk and honey. That is certainly not the Scotland I know and does not reflect the constituency which I represent.

I would go so far as to say that unemployment is part of the trouble in Northern Ireland. Glasgow Members will recollect that when we had a large number of unemployed years ago we suffered from gangs in the City of Glasgow. It is a crime for a man not to be able to sell his labour and to have to spend his time hanging around street corners. The fact that he cannot provide properly for his family in the same way as his neighbour invokes a sense of resentment in the man who cannot obtain employment.

It is imperative that there should be investment grants in Scotland. I speak not only as a trade unionist but also as one who has been an employer in Scotland for the past 20 years. I know how important these grants were and it is imperative that they should be restored.

The question of school leavers is most important in dealing with unemployment. It is not often I quote the Scottish Daily Express, but there were two very good articles in that newspaper last week by Mr. James Macmillan, with which I very much agreed. He said the fact that the school leaving age was being raised this year would save 277,000 jobs. When this happens I urge the Government to pay bursaries to these children who would normally be bringing in wages. Mr. Macmillan also advocated the payment of pension at the age of 64 rather than 65 to encourage earlier retirement. This again would save 150,000 jobs. I would like to see equality of wages for women. Too often in many parts of the country a man and his wife go out to work because it is cheaper to employ a woman; but it must be remembered that the man next door may well be out of employment. This totally upsets the balance of income in many working-class homes.

I believe that the present Government, as well as the Labour Government, should have given some thought to training of workers during leisure time. In this country a man works until he is 65 and then after retirement he does not know what to do with himself. I was elated last week to hear the announcement by the Secretary of State for Scotland about developments at Hunterston and I was delighted to hear about the increase in training awards. I had one reservation, as I made clear in a recent visit to Livingston. We are at the moment training long-distance drivers, but in any part of Scotland one can pick up a telephone and get as many long-distance drivers as one wants. This is because automation has speeded up and cheapened services, and it is faster to send goods by road.

The Government should also be doing more in terms of slum clearance. At present, we are knocking down slums in Glasgow where many families use one toilet. However, I visited a council house in my constituency last night where I saw water running down the walls like a burn over a waterfall. When we have finished with our old slums, we ought to start on our new ones. In Priesthill, Blackhill and many other parts of Glasgow, tens of thousands of building operatives are unemployed, and there is no shortage of bricks and cement. I suggest that the Government ought to be doing a good deal more in this direction.

In this House, we have had enough talk, and more than enough facts and figures about unemployment. Now is the time for action. We want no more talk.

6.20 p.m.

Mr. William Ross (Kilmarnock)

I must first congratulate my hon. Friend the Member for Glasgow, Springburn (Mr. Buchanan) not only on his timely luck in the Ballot, but in two other respects. By that, I mean his choice of subject and the way that he tackled it. If anything, he understated the position. It may be that, in view of the gravity of the position, it is not one which requires overstating.

My hon. Friend spoke with great feeling of the Springburn that he knew. He described how, with all its ups and downs, it is still a thriving community. I believe that it is one of the worthiest communities in the country. It was there that we had the greatest rolling stock manufacturing centre in the whole of Europe. I can remember seeing that as a desolate place when I was Secretary of State. I was there in the presence of Sir Robert Maclean, of Scottish Industrial Estates. We were creating a new industrial estate from which we hoped that new prosperity would come to the area. I asked, "Will people come here?" Sir Robert pointed to the houses round about and he said, "They will come here. They will see the houses. They will see the population, and they will know the traditions of the people." We in this House must remember those traditions. We must not accept pessimism. I have confidence not in this Government but in the people of Scotland. Given the opportunity, they will rise above their present difficulties.

I thought that the hon. Member for Aberdeen, South (Mr. Sproat) made the worst speech of the day—[Interruption.] The hon. Gentleman must accept that I have a right to my opinion. He said that the Government had a coherent, planned strategy. I wonder whether he realises what has happened since his right hon. and hon. Friends became the Government. I am grateful to my hon. Friend the Member for Lanarkshire, North (Mr. John Smith) for putting down a Question every now and again asking the Secretary of State for Employment :…if he will publish a list of the redundancies in Scotland certified to his Department each month from June, 1970, to the latest available date. The latest available date is 10th January, 1972. The total was 65,200. Those are redundancies registered with the Department of Employment. However, redundancies are required to be registered only if they are above a certain figure. The figure is way above that, and it is only up to 10th January.

The hon. Member for Ayr (Mr. Younger), the Minister for Committee Room 14, will realise that there have been redundancies declared in his constituency since that date. We have had redundancies in practically every Scottish constituency since then. Whereas in the latter part of last year the Secretary of State for Scotland was saying that redundancies were down to about 500 a month, he will be sorry to realise that in the last month they have risen to more than 800 a week. The last available figure, that between 7th December and 10th January, showed that there were more than 800 a week and 3,500 in the month. The position becomes even more serious when one considers where they are taking place, because they are occurring in those areas which have been hard hit in the past.

My right hon. Friend the Member for Lanark (Mrs. Hart) produced a devastating figure and pointed out exactly what it means in human terms. She said that more than 34 per cent. of the unemployed in Scotland had been unemployed for more than six months. They have outrun their wage-related benefit and are down to the bare minimum. Many of them have families. They are families with the same aspirations as everyone else of keeping children on at school, having annual holidays and a decent standard of life. They want to be able to hold up their heads and pay their way.

When one studies the figures and discovers the number of unemployed who are just over 40 years old, one begins to realise how exactly right my hon. Friend the Member for Springburn was to describe unemployment as "a corroding malady". It is going right to the heart of the Scottish people, and the Scottish people are angry. They are not despairing; they are angry. They have been looking and waiting for this Government to do something about it. They do not want alibis like the silly one that we heard from the hon. Member for Aberdeen, South that my right hon. and hon. Friends doubled unemployment during our period in office. We did nothing of the sort—

Mr. Sproat

Then by what did the right hon. Gentleman and his party put it up?

Mr. Ross

All that the hon. Gentleman has to do now is listen. I have not very much time, but I shall use it to the full.

For five months after right hon. and hon. Gentlemen opposite became the Government, they did nothing. They went away on holiday. On 26th October, 1970, they produced their great new plan. The Secretary of State said, not in this House but at a Press conference: This is a great impetus for Scotland. What did they intend doing? They proposed cuts in Government expenditure. They proposed cuts in local authority expenditure. They proposed to save £1,500 million by 1975. They intended to save it on housing and on practically everything else, including grants to industry. They intended to do it by the changes which have been attacked from all parts of the House today, one of which concerned investment incentives, and the change from grants to allowances.

That was to be the first great part of this new coherent strategy. The result, a year later, is that unemployment has risen in Scotland from just over 90,000 to 154,000, and it is still rising. The result of this great impetus has been that we have had in 1971 one of the lowest records of new industrial projects coming into Scotland. The Government proclaim that their new strategy is pouring money into the local authorities. They began by cutting down on the money going to local authorities. Now they have turned turtle.

We all remember the debate when the Government announced their special development area policy. Today, almost exactly a year later, what is the position? Following the Government's announcement in February last year, the Scottish Press carried headlines such as Bonanza for Scotland. What has it done? It has confused industrialists. It has achieved nothing, one of the main reasons being the failure of the Government's coherent strategy. Today, from every side, there is an attack on this special development area policy.

The hon. Member for Galloway (Mr. Brewis) surprised me when he said that he wanted an inquiry into investment grants. My hon. Friend the Member for Motherwell (Mr. Lawson) spent weeks asking the Government what had happened about investment grants and why right hon. and hon. Gentlemen opposite had decided to change to investment allowances in advance of knowing what the inquiry would say. Clearly there was no coherence in this Government's policy. They thought that they knew the answers before the election. Then they discovered that they were dealing with a situation which was completely different.

Now we have structural unemployment. The Prime Minister has discovered it; so has the hon. Member. Where is the hon. Member who used to play the numbers game, whereby one picks a date when unemployment is high and another when it is low, subtracts one figure from the other, and says, "You have lost all these jobs." The hon. Member for Aberdeen, South was at it tonight. Does he realise that in the unemployment debate just before the 1964 General Election we had three estimates of unemployment. The hon. Member gave us another tonight. Let him continue to play the numbers game. In a fortnight's time we shall be given the latest figures of job losses. Let him then discover whether he is still willing to play the numbers game. It is a silly game.

The Government must deal with structural unemployment. They must make an analysis of what it means to new industry and ascertain whether or not we can come to terms with it. In the meantime, they must not worsen the situation for existing industry—as we have seen them do in the case of Rolls-Royce and U.C.S., and in their failure to intervene in the Plessey dispute. Time after time we have seen existing industry being thrown away, and on every occasion confidence has been further eroded.

The first thing that the Government must do is to accept responsibility for full employment. If they will not do so, let them say so, but if they are willing to do so they must accept the further responsibility of discovering how to achieve it. That means Government intervention in both private and public industry. It means providing the incentives that will bring about an expansion not merely in incoming industry but in existing industry.

If the Minister makes a further analysis of what has happened in Scotland since 1945 he will see that most new jobs have been created through the expansion of new industry. The special development area policy inhibits and restricts existing industry. In these areas that policy is wrong. I have told the Government about that before. They took up this business of special development areas, which had been applied to mining areas, where there was no other industry and where special preference brought about a considerable improvement in the position. The hon. Member for Dumfries (Mr. Monro) and the right hon. Gentleman know what has happened in their areas. When this policy is applied over a wide area, where other industry already exists, conflicts arise. There is enough to hold back expansion at the moment, without adding this. My hon. Friend the Member for Springburn and my right hon. Friend the Member for Lanark raised this matter, and I believe that the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor) mentioned it, although he did not go so far.

Every—I nearly said "Establishment" institution in Scotland; it is amazing how they become Establishment institutions once we have a Tory Government—every industrial institution has been saying the same thing, but the Government will do nothing about it. I hope that the right hon. Gentleman will exercise his powers as Secretary of State and as a member of the Cabinet and make some announcement.

We have had the question of the ore terminal in relation to the steel industry. The right hon. Gentleman thought that we were going to have a Scottish debate and that I was going to speak, so the Government announced the decision of the British Steel Corporation to go ahead. It was the Corporation's decision to go ahead.

Mr. Gordon Campbell

It is the corporation's timing.

Mr. Ross

Of course it is. But over three years ago, at the public inquiry, the Corporation was talking about the position of an ore terminal at a time when we were concerned about the future of the steel industry. The ore terminal was essential for the continuation of the industry. For years before that a search had gone on round our coasts for a suitable site—in the Lower Clyde, along the Ayrshire coast, and at Ardrossan. Long ago it was known what was required, and where it should be put.

The right hon. Gentleman blindly came across Hunterston in 1969, like some pioneer, but he was centuries after other people had discovered it. He will bear responsibility if this project founders. I do not share the fears of some that it will founder, because I do not believe that the Scottish people will allow it to do so. We are told that the Corporation is in discussion with the Clyde Port Authority. What has it been doing for the last two years? I should have thought that those discussions would have been completed. What has happened to the feasibility study mounted by the Stenhouse Group and the Scottish Office in respect of a general port? Will this be used as an excuse by the Treasury or the Department further to hold it up?

I realise that the Minister has nothing to do with the money aspect of the question; the Department of the Environment controls the purse strings. Port development is supported by the Department of the Environment, and the Government have made a decision about grants. This matter is urgent, and we want to know when the work will be started. It is no good saying that after it starts it will take two-and-a-half years. We want to know exactly how we are going ahead. This is the brightest gleam that we have had; let us not have it extinguished.

The right hon. Gentleman and the Government must intervene in respect of nationalised industries. I was interested in the point made about dispersal policy. This policy should not be confined to Government Departments. Unless our regional policy is coherently followed through in respect of industries over which we have a certain measure of control—the nationalised industries—one thing will cancel out the other. We have already had a hard knock in terms of dispersal. People talk about the Forestry Commission, but what about the new income tax centre? The decision had been taken to site it in Edinburgh, but that is now completely washed out.

I am sorry that my hon. Friends from Edinburgh and Dundee were not able to speak this afternoon. The position in Dundee is probably worse than it is in my area, in many ways, because additional to the other factors, such as lack of investment confidence, Dundee has to face difficulties in relation to the struggle that has gone on in Bangladesh, and the troubles that have affected supplies of fuel.

The Dundee area is one of the worst unemployment areas in Scotland. The male unemployment figure is 10 per cent. It is not in a special development area. It is not a small pocket of unemployment. I am surprised that the Minister still has his P.P.S. He represents part of the Deeside area, and he must be aware of the difficulties there.

When shall we have a coherent policy in respect of attacking unemployment through incentives and also setting up the administration to deal with structural unemployment? The Government must accept responsibility for full employment. They must take further measures to stimulate investment in both the private and the public sector—including the development of ports and the steel industry. In relation to Hunterston we want the green field site, and we want the development of Scottish steel.

What about power? What about the new power station in Banff? We have heard too little about that. I was Secretary of State when it was announced. It is time that we heard something about it.

The Government should take special steps to maximise continuous social building. I will not talk about housing now, because we have plenty of opportunity upstairs. However, I think that the right hon. Gentleman is wrong in the policy which he is pursuing on that matter. We need schools, hospitals and health centres. We need many facilities in the countryside and the towns.

There is also the task of cleaning up Scotland. There are parts of Scotland which are an absolute disgrace. I am not talking merely about the derricks in the former mining areas; I am talking about some of our towns and cities which pride themselves on what they have done. Cannot something be done to harness these efforts? We will not achieve very much by merely giving them capital grant support. The Government should have an imaginative programme supported by 100 per cent. grants. If necessary, they should organise special corps in each area for this purpose. The right hon. Gentleman can do this. Scotland can be helped by the organisation of development boards. Glasgow particularly requires help in this way. It needs a development and executive board with the money to get on and provide help. It could even handle the U.C.S. situation as well.

I should have liked to mention oil. This can either delude or dazzle. It could be an advantage which could be thrown away. We want to know far more about this matter. I should like to know how long these reserves of oil will last. The right hon. Gentleman will appreciate that the Opposition selected this debate, and it is only fair that our point of view should be expressed on this matter.

Mr. Gordon Campbell

The right hon. Gentleman has asked for answers.

Mr. Ross

But we never get them. Please do not give us the same thing about going away to pre-history.

Mr. Speaker

Order. I thought that it was agreed that each Front Bench speaker should have 20 minutes to wind up.

Mr. Ross

It was, Mr. Speaker. I think that at this moment I am probably just on my 20 minutes.

We want more information about oil. I want the Scottish Office to ensure that it is properly and adequately planned in relation to what it might cost us regarding our environment and to ensure the maximum number of jobs and financial advantage to Scotland deriving from the revenue.

If the right decisions are taken there is hope. If the right decisions are not taken, the serious position into which we have been driven by the neglect and failures of this Government will get worse. We eagerly await the right hon. Gentleman's speech to see whether we should divide the House on this matter.

6.43 p.m.

The Secretary of State for Scotland (Mr. Gordon Campbell)

I congratulate the hon. Member for Glasgow, Spring-burn (Mr. Buchanan) on winning the Ballot and on the way that he raised this subject of compelling concern to all in Scotland of the intolerable level of unemployment and the best ways of improving it.

In the short time which is left to me I will try to deal with as many as possible of the points which have been raised. As I said in the debate a week ago—I shall not repeat what I said then —the Government are acutely conscious of the unhappiness and insecurity caused to families by unemployment. I pointed out that the new and insistent element to be tackled today is that industries have been shedding labour; though they are producing the same as or more than before they are working with considerably fewer men. In one year, as a result, there has been a reduction in manpower of as much as 4½ per cent. in manufacturing industry.

The debate today has concentrated on ways of dealing with this situation in two parts. The first part concerns immediate measures. The hon. Member for Springburn has drawn attention to ways in which the Government have already embarked on massive expenditure on infrastructure and other projects and suggested what more can be done.

The second part concerns the longer-term possibilities which affect present unemployment but could greatly influence industrial activity some years ahead. These are also important, and we have had the opportunity of discussing them today.

The right hon. Member for Lanark (Mrs. Hart) suggested that other Ministers should be here. At least five separate Departments are affected by this subject. If we take account of the point raised by my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward Taylor) there are six.

I undertook as a member of the Cabinet to reply to the debate, and every point which has been raised will be referred to the appropriate Department. The terms of the Motion clearly take us back to 1970 with the reference to rocketing prices. Prices certainly were rocketing then as a result of cost inflation, but that wild inflation is now being curbed.

The origins of cost inflation were not difficult to discover—the excessive level of pay settlements which began in the autumn of 1969. There can be no doubt that such high pay settlements, leading to increases in money incomes far in excess of productivity growth, were the main factor in bringing about inflationary price increases.

In response to the right hon. Member for Lanark—

Mr. Norman Buchan (Renfrew, West)

rose—

Mr. Campbell

I cannot give way. In response to the right hon. Member for Lanark, I should point out that at the beginning of last year, 1971, average earnings were 14 per cent. above a year earlier and retail prices, excluding seasonal food, were 9½ per cent. higher at an annual rate than six months earlier. No nation can afford such high rates of increase and survive in international markets or protect the jobs of its men and women.

Our policy against inflation has been to impress upon employers in both the public and private sectors, and on the unions, the need for a substantial and progressive de-escalation of pay settlements. At the same time we have acted directly on prices. S.E.T. has been halved and purchase tax cut by 18 per cent.

Mr. Buchan

rose—

Mr. Campbell

The nationalised industries are co-operating with the C.B.I. price restraint initiative, which is not more than a 5 per cent. increase in a period of 12 months.

There are many firm indications that our policy on wage and price de-escalation is succeeding. Increases in retail prices last December, excluding seasonal food, were at about half the rate in the middle of 1971. The improvement in retail prices has been widely spread. With the exception of seasonal foods, all components of the retail price index increased less in the second half of last year than in the same period in 1970.

I am sure that the House will welcome this latest information. The hon. Member for Springburn, in using the adjective "rocketing", will recognise that the rocket is now at the stage when its flight is slowing down. Besides this slowing down of price increases, pensions and benefits have been raised.

The rising tide of unemployment which we found on coming into office has continued, with industries reducing their labour forces without reducing output. Raging inflation was one of the causes in 1970 of this situation. We profoundly deplore this situation, and no Government have done more in so short a time to boost the economy. Bank Rate has been sharply reduced, credit restrictions lifted and taxes slashed. In these and other ways money has been pumped into the economy in recent months to assist business activity and investment.

In addition, programmes have been advanced and a vast public works programme for Scotland has been launced which will continue until the middle of next year. Most of it is applied to infrastructure of all kinds, and it is a large injection in addition to the normal programmes within my sphere of responsibility which are expected to account for some £370 million of capital expenditure during the coming financial year. This is over and above the expenditure in Scotland by the nationalised industries, which are also advancing some of their programmes to the coming months. The programme of additional public works in Scotland now amounts to over £60 million, most of which will be spent in the coming year.

In reply to the hon. Member for Inverness (Mr. Russell Johnston), this was an urgent programme. That is why it was tied to a short period ahead—because it was a special programme.

In addition, £6.5 million will be spent on environmental improvement in the Glasgow area and another £6.5 million will be spent in West Central Scotland, both with Government grants of £5 million each; £2.5 million will be spent on infilling the Queen's Dock in Glasgow, and 1.5 million on reconditioning Glasgow underground.

Under the Housing Act, 1971, there will be an increase of over £15 million in the amount of grant-aided house improvement work. These are the sorts of programme which the hon. Gentleman was referring to.

The Government have also brought forward—[Interruption.] I have been left very little time, less than was arranged. The Government have also brought forward defence programmes to help relieve unemployment. We have accelerated naval shipbuilding orders and £50 million worth of defence shipbuilding contracts have been allocated to Scotland. These are for three frigates worth £20 million which are to be built by Yarrows; two fleet replenishment ships and one experimental vessel, worth in all £25 million, the contract for which has been placed with Scott Lithgow; and one survey ship and two mooring salvage vessels an order worth £5 million in total, which are to be built by Robb Caledon on the east coast.

On the aircraft side, 100 bulldog training aircraft are to be constructed by Scottish Aviation at Prestwick.

These are advanced programmes by the Government with massive expenditure of the kind which the hon. Gentleman was referring to.

Mr. Ross

We have heard all this.

Mr. Campbell

It did not sound as though the right hon. Gentleman had taken it in. I will remind the right hon. Gentleman also of something else that he should have heard about—namely, of the upward turn of approvals of new house in the public sector, thereby reversing the trend since 1967. There has also been a sharp increase in house building for home ownership. This has caused an increase of nearly 50 per cent. in the number of starts of private houses in 1971 compared with the previous year.

The hon. Member's Motion calls for the encouragement of investment in the private sector as well as in the public sector. This reflects steps taken by the Government to stimulate building for home ownership—for example, the easing of credit restrictions on banks, the reductions in bank rate, the removal of restrictions on local authority lending for house purchase, the abolition of stamp duty, and, not least, the halving of selective employment tax. There is also the work of improvement of older houses—

Mr. Maclennan

On a point of order, Mr. Deputy Speaker. As I understand the position, it is in order for Ministers to seek the permission of the House to circulate information in the OFFICIAL REPORT. [HON. MEMBERS: "Cheat."] The Secretary of State has just given us information which could well fall into that category and apparently is intent upon continuing to give us such information for the rest of his speech. Would it be in order to suggest that the Secretary of State should circulate it in the OFFICIAL REPORT and answer the debate?

Mr. Deputy Speaker (Sir Robert Grant-Ferris)

Not at all. That is not a point of order for the Chair.

Mr. Campbell

I now have two announcements to make in what I believe is the spirit of the Motion. We have been exploring and searching for even more work which will need to be done. Our aim is to keep and create jobs now during the difficult time following a very serious period of inflation and shortage of labour.

As a result—these both relate to environment and dereliction matters which were raised by the hon. Member—I am announcing two schemes. First, following the two £5 million schemes which were last year announced by the Government as grants for environmental work in and around Glasgow and in West Central Scotland, I am now initiating a special scheme, for a limited period, else- where in Scotland. My right hon. Friends the Secretaries of State for the Environment and for Wales are introducing similar schemes for England and Wales.

I am asking local authorities concerned in Scotland to bring forward, quickly, minor projects of environmental improvement which will create employment and also improve local amenity. The scheme will cover work completed by the end of June, 1973, and I am making grant available for approved projects at the rate of 85 per cent. in the development area under the Industrial Development Act, 1966. I would expect the total amount of grant to run to £1 million or beyond.

I am writing this week to local planning authorities asking them to submit schemes as urgently as they can. The kinds of project I envisage are those which are not normally done as major derelict land clearance.

The second scheme relates to clearance of derelict land, a subject to which the hon. Gentleman called particular attention. I am now seeking to increase the rate of submission of major schemes by local authorities to clear the most obtrusive dereliction. Although most local authorities in Scotland have made good efforts to deal with major dereliction in their areas, the problem which remains needs renewed drive.

I am therefore about to issue a circular to all Scottish local authorities calling for programmes which will aim at clearing virtually all areas of major dereliction within the next ten years. Generous grants at the rate of 85 per cent. in development areas are available and the capital allocations have been increased to support the greatly increased activity I am calling for. I should hope to see spending on these major items double—that is, rise to about £2 million a year.

My hon. Friend the Member for Cathcart raised the question of steel and the E.E.C. There is nothing in the Treaty of Paris which prevents a country from having a system of multiple basing points. I congratulate my hon. Friend on his own productivity.

As regards regional development, M. Borchette, the Commissioner concerned, when he visited Scotland recently, made it clear that our system of incentives can be calculated by E.E.C. criteria and are acceptable. There were references to investment allowances. We have capital allowances and free depreciation in development areas, building grants at high rates, and grants and loans under the Local Employment Acts. Free depreciattion has been much valued by industry. This point has been underlined recently by the Scottish Council, Development and Industry and I spoke of it as some length in my speech a week ago.

The right hon. Lady the Member for Lanark asked about projects at Lesmahagow. It was for the same factory that the three firms were applying, I understand. I am glad to say that one of them has decided to go ahead at that factory. The general question of the operational grant being available to incoming industry for three years and not to industry within special development areas is one of which we are very much aware. The operational grant is for the special purpose of assisting those who must move in and start from the beginning.

As to West Central Scotland, special development area status has led to an increase in the period from February, when it was introduced, to December, 1971, of 5,650 jobs coming in during that period compared with 3,600 during the equivalent period in the previous year.

I should have liked to have gone into the Hunterston question, but there is not sufficient time left. I announced that and also spoke at length on the question of the British Steel Corporation's plans and investment programme in the debate a week ago. Also at that time I was able to put an end to a number of rumours which seemed to be circulating about the Corporation's plans.

Last week, Scots were treated to a homily on our shortcomings by the right hon. Member for Orkney and Shetland (Mr. Grimond). [HON. MEMBERS: "Where is he?"] He has been here. He has just left. Perhaps this was good for our characters, but I do not subscribe to the right hon. Gentleman's strictures and theories. I do not believe that there are great differences in the distribution of failings or weaknesses North and South of the border. I leave it to my hon. Friend the Member for Bute and North Ayrshire (Sir F. Maclean) and others to deal with this. Their Motion on this matter brings to mind the chorus from the Negro Spiritual— I hear their gentle voices calling— We can unwittingly damage our prospects in Scotland by apparent pessimism and gloom and a reluctance to help ourselves. This is not a true picture, but this impression is sometimes given by those whom I would call the wailing willies—

Mr. Buchanan

rose in his place and claimed to move, That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question put accordingly and agreed to.

Resolved, That this House, noting with concern the thousands of families in Scotland suffering the indignity of unemployment and the increasing poverty caused by rocketing prices, calls on Her Majesty's Government to initiate massive new expenditure on the Scottish social and economic infrastructure and to stimulate a very rapid rise in investment in new and existing industry.