§ 12.16 a.m.
§ Mr. John Wilkinson (Bradford, West)
I am glad to have this opportunity to raise the question of special intermediate area status for the Bradford region. Eleven months ago, on the eve of the Easter Recess, I raised a similar matter on the Adjournment, when I discussed the economic prospects of Bradford, in the course of which I coined the phrase that we wanted no Maundy money.
1613 It was thought at that time that Government hand-outs were not necessarily the correct basis on which to create a local economy with high employment, economic growth and increased prosperity. It was my hope that the expansionist measures which my right hon. Friend the Chancellor of the Exchequer had recently announced in his Budget, plus any subsequent reflationary packages, would be beneficial in bringing about a more buoyant local economy.
At the same time, I voiced my anxiety about the inflexible regional policies that we had inherited from the previous Administration. The arbitrary distinctions between those areas adjacent to Bradford designated as development or intermediate areas put Bradford itself and its immediate neighbourhood at a relative disadvantage.
To recapitulate those earlier arguments, expansion in Bradford's mail order business, for example, took place in nearby Wakefield, which is part of an intermediate area. Likewise, expansion in Bradford-based wool textiles, which would normally have been expected to take place in Bradford itself, instead took place in two instances in the Northern Development Area, in Scotland, in Barrow-in-Furness, and in Cumbernauld, respectively.
It is my belief that it is an inefficient policy, as well as one which makes bad sense economically, which encourages the artificial expansion of an indigenous industry in regions remote from the source of its skilled and experienced man power.
It was not for lack of well-researched advice that the last Government got their regional policies wrong. The Hunt Committee on the Intermediate Areas recommended intermediate area status for Yorkshire and Humberside as a whole, as well as for the north-west economic region. Concerning Yorkshire and Humberside, in particular, the last Government implemented these proposals only in part, giving North Humberside and South Yorkshire intermediate area status, while leaving the rest undesignated. That was despite the forecast in their Green Paper. "Economic Assessment to 1972", published in 1969, which said that the greatest increase in unemployment in the period in question would be likely to take place in Yorkshire and Humberside.
1614 On 8th April last year, when I declared that it would be inappropriate for the City of Bradford to be part of an intermediate area, I said so explicitly in the expectation of a new approach to regional policy whichshould end or certainly alleviate the regional disparity."—[OFFICIAL REPORT, 8th April. 1971; Vol. 815 c. 773.]Again, at the Conservative Party Conference in October, the debate on trade and industry took place to a resolution moved by Bradford West Conservative Association which called for more flexible regional policies to secure a more equitable spread of prosperity throughout the country. That resolution, to which my right hon. Friend the Secretary of State himself replied, was overwhelmingly carried by the conference.
Over the past year male unemployment in Bradford has increased by 1.8 per cent., to 7.3 per cent., according to the latest figures. At the same time, average earnings in Yorkshire and Humberside are still the lowest of any industrial region in the country. In fact, the most statistics that I have reinforce these arguments for more flexible policies.
In particular, over the past year the percentage increase of unemployment, both male and female, in the Bradford-Shipley travel-to-work area have been not only 10 per cent. higher than those increases in the North Humberside intermediate area but, at about 33 per cent., directly comparable with the figures for the northern development area. This is a matter which must seriously be taken into consideration.
There are those who believe that fiscal or monetary measures alone would alleviate our problems in the Bradford area. Of course, like all industrial areas, we await hopefully my right hon. Friend's Budget Statement on 21st March. In this regard, a further cut in purchase tax, especially on wool textile products, would be helpful, as would reductions in company taxation. In Bradford in recent months we have benefited particularly from earlier reductions in purchase tax, and this has had markedly beneficial effects in the manufacture of colour television sets. However, the manufacture of colour television sets is predominantly helpful from the point of view of female employment, and the difficulty in the Bradford area and the West Riding wool 1615 textile district lies in providing male employment. We must be very clear in making that distinction.
Nevertheless, I am not certain that our local economy will be transformed by reflationary measures alone. Not only are balance of payments criteria bound eventually to limit the expansion of consumer demand at home; the very process of the modernisation of the wool textile industry, which is still our staple industry employing 23 per cent. of the work force, must, as the Atkins Report, 1969, predicted, involve a diminishing demand for manpower as production processes become more capital-intensive and automated.
It is illuminating to consider changes in production personnel in the wool textile industry from 1947 to 1970, the last available date. To take three areas which particularly affect Bradford, in combing the work force has virtually halved—from 12,500 to 6,400—in worsted spinning it has dropped from 43,900 to 30,000, and in worsted weaving from 28,000 to 15,000. This process is bound to continue. As yet we do not have sufficient diversity of industry—particularly advanced high technology industries with high earning power—to replace this diminishing demand for labour.
I said in the debate on 24th January that in reshaping our regional policies we must seek more imaginative criteria. The days are past when simple statistics of employment were used. I suggested then that earnings might be one criterion, and that there was a very real need for an exhaustive analysis by regional economic planning councils of the structure and nature of industry in the regions.
This was very much hinted at in the Hunt Report, in which the question of the situation of growth points was very much left begging, because, Hunt claimed, it was not within his committee's terms of reference. It should be within the terms of reference of the planning councils. It is in view of the possibility of Bradford and its surrounding area becoming a growth point and a focus for expansion that I suggest intermediate area status for the region. That status will not necessarily be retained in perpetuity. I regard it as a shot in the arm—an opportunity for new industry to be attracted on the 1616 same terms as in the development and intermediate areas.
I know that with the review of regional policy currently in train, areas with comparable problems to ours, in Lancashire and other textile districts, are making similar representations. Bolton springs very much to mind in this regard. I noticed with some satisfaction that the Secretary of State for Trade and Industry said, in reply to a Question by one of the Bolton Members, that in this review he was considering once more the recommendations of the Hunt Committee, that intermediate status should be extended to the whole of Yorkshire and Humberside and the whole of the north-west region.
Inevitably, I am asked why Bradford is well fitted to be a growth point and why it would benefit especially from development area status. First, communications have benefited enormously under this Government, and Bradford is fast becoming the hub of an effective motorway network which will provide good links with the ports, particularly on Merseyside and at Hull.
We have our problems even in this regard; air transport springs to mind. We have been greatly inhibited by the lack of a modern international airport, capable of taking the latest jet aircraft. Nevertheless, our communications are good in other respects. There is to be a rail freight depot at Low Moor and a transport interchange in the city. All these things help, and we must have inducements to attract new industry to the area to take advantage of these developments.
Throughout the Pennines area there are towns and cities with a high proportion of housing stock which pre-dates the first war, and in some instances pre-dates the turn of the century. The greater part of this housing stock is sound, and adequate finance is needed to renovate it.
The Secretary of State for the Environment has done well to provide 50 per cent. improvement grants for the renewal of housing, but those grants amount to 75 per cent. in development and intermediate areas. We have as high a portion of older housing stock as do many of the big cities in intermediate and development areas, which enjoy these privileges, and in the housing and construction industries there has been a high 1617 level of unemployment in recent months. If special intermediate area status were granted we should have an extra 25 per cent. grant, which would be extremely valuable for the renovation, restoration and renewal that is so important.
I am anxious to be brief because I know that my hon. Friend the Member for Keighley (Miss Joan Hall) would like to contribute to the debate.
We are seeking to make our position quite clear in the review of regional policy which is in progress. I hope that my hon. Friend will give an assurance that the points that I have raised on this and previous occasions will be brought to the attention of the Secretary of State, so that Bradford's case is not overlooked in the review of regional policy which is in progress.
§ 12.33 a.m.
§ The Under-Secretary of State for Trade and Industry (Mr. Anthony Grant)
I have listened closely to what my hon. Friend the Member for Bradford, West (Mr. Wilkinson) has said. He has given a clear and comprehensive survey of Bradford's problems and I fully share his concern about unemployment in the area. Bradford can congratulate itself on having such a vigorous young advocate as its hon. Member.
We discussed Bradford's situation last April and again in November, and I am most grateful to my hon. Friend for providing another opportunity to do so tonight. It has been disappointing to see the unemployment rate in the Bradford and Shipley area rise over the past year, although it is perhaps some consolation that the rate in January showed no further increase over that in November, when we last debated the subject. However, one knows only too well the human hardship that lies behind the statistics.
To some extent it is fair to say that the local situation in Bradford has reflected the national position, but this is not to ignore the effect on redundancies and unemployment levels of rationalisation in the wool textile industry. That industry has of course, been going through a difficult period, largely as a result of changes in consumer demand.
Part of the decline in employment in this sector has come about through the modernisation that this vital industry has 1618 undertaken to ensure long-term viability in a different market situation. Despite these difficulties, both employers and trade union officials in the industry have expressed confidence in its future prosperity. Entry to the E.E.C. should certainly improve export prospects. The fact that production in the industry as a whole rose in December, 1971, against the trend of previous months, gives some grounds for hope that the worst of the recession has passed.
It would, of course, be wrong to leave the impression that Bradford was solely a textile town. Indeed the textile industry there, major as it is, accounts for only about a quarter of those employed. Another quarter is accounted for by other manufacturing industries and the remainder by the construction and service sectors. Those activities have also been affected by the general slackness of the economy and by the rationalisation needed to offset cost and wage inflation. My hon. Friend knows well the many steps that we have taken to deal with these problems, which originated in the policies pursued in years past. Bradford has a sufficient diversity of industry to profit well from those measures.
Before turning to the specific question of intermediate area status for Bradford, it may be as well to remind hon. Members that the legislation requires us to take into account in such decisions "all the circumstances, actual and expected". That means, of course, that unemployment levels are not the sole criteria, and that factors such as the industrial structure, to which I have referred, and the environment, to which my hon. Friend referred, must be fully considered. Indeed, these considerations must all play a part in our long-term regional strategy, not just in assisted area designation.
My hon. Friend mentioned that Bradford, as a derelict land clearance area, is eligible for 75 per cent. grants towards clearing away derelict industrial buildings. Under the special environmental assistance arrangements announced by my right hon. Friend the Secretary of State for the Environment last month the local authorities in the area will now be able to put forward other schemes to improve the local environment. These measures should be particularly useful in enhancing Bradford's future prospects as 1619 a desirable place to live and work. Bradford Council has plans for large general improvement areas under the Housing Act, 1969, and is also attempting to provide 500 council houses each year to meet the needs of old people. I congratulate it on what it is doing. The reorganisation of local government, by making Bradford part of the West Yorkshire metropolitan area, with larger resources, should also help to deal with the area's infrastructure problems.
There may have been some misunderstanding about industrial development certificates, not only in Bradford but in other parts of the country. Our regional strategy takes in basic infrastructure as well as national and local industrial situations. But the one strand which, in the past, has given places such as Bradford cause for concern has been the control of industrial development certificates. It is worth pointing out that, subject to the requirements of the development areas, I.D.C. control in the Bradford area has been liberally interpreted. I.D.C.s would normally be available for reasonable expansion by existing firms, for rehousing of firms already in the area, and for firms with strong ties to the area. Indeed, in 1970 and 1971 taken together, only one I.D.C. was refused in the Bradford-Shipley area—and that was rather a special case—as against 41 approved, and expected to give rise to 1,270 jobs, though I accept that a number will be for women. Nevertheless, that indicates that no company should fail to apply for an industrial development certificate in the area now.
I have, for instance, very recently approved an I.D.C. for the British Radio Corporation at its Beckside works in Bradford, to be used for the production of colour television sets. That should give rise to 750 extra jobs, of which 550 will be for women. Certainly no company should feel deterred from applying in that area.
§ Mr. Wilkinson
Would my hon. Friend like to emphasise that this expansion could not have taken place without the measures which the Chancellor of the Exchequer announced earlier this year? As a direct consequence, there has been the upturn in certain engineering undertakings, particularly in motor components, which has helped to diversify work in the city.
§ Mr. Grant
I entirely agree. It was precisely to achieve those results that the Chancellor made those decisions. It is very encouraging to see those measures taking effect in the Bradford area.
I turn now to the question of intermediate area status for Bradford, which was one of the main points that my hon. Friend mentioned. As I am sure my hon. Friend realises, the question of which areas should receive assistance in attracting industry, and what form that assistance should take, is one of the most complex problems that Government have to deal with. The first intermediate areas were created two years ago, following the very detailed report of Sir Joseph Hunt's Committee. The 200-odd pages of that report demonstrate the complexity of the subject, and it was of course the late Administration that turned down the Hunt Committee's recommendation that the whole of Yorkshire-Humberside, including Bradford, should be awarded intermediate area status. Their explanation for that decision was that such a major extension of the assisted areas would react on the more severe problem areas by spreading too thinly the resources available to create new employment.
To be fair, there was and is some force in that argument, and we are taking it into account in our study of regional questions. But that is not to say that we are not also very much aware of the points made tonight by my hon. Friend, and points made at the meeting I had yesterday with Members from Yorkshire constituencies. I am not in a position to make any statement of our views today. What I do say is that in considering claims for assisted area status we have many complexities to deal with. Inevitably this takes time.
As my hon. Friend recognised, Bradford is not the only area of the country pressing for one form or another of assisted status. We are carefully considering such claims in the context of our wide-ranging study of the regional problem. I need not reiterate the national economic measures that we have already taken to deal with the slackness of demand which my hon. Friend illustrated in his intervention. We have also made several major changes to improve the effectiveness of the regional policy measures that we inherited. At the same time, we have never claimed that the 1621 measures as they now stand were a complete answer. We have continued to look for better methods of tackling the problem and have been studying in depth the whole field of regional policy, not just assisted area boundaries.
My hon. Friend's interesting suggestion tonight for special intermediate area status is certainly intended to provide greater flexibility and is worth looking at in that specific context. My right hon. Friend the Secretary of State has told the House that the results of our work and study of regional policy should be made known in a reasonable time. As I have said, I cannot anticipate the outcome today, but I am grateful to my hon. Friend for giving me this opportunity to assure the inhabitants of the Bradford area that we are well informed on the situation there, largely through his assistance, and that this is being given full consideration in our work on a coherent national strategy.
Perhaps I may now turn to another matter which I know is of concern to 1622 Bradford—the question of small firms, which are a vital feature of the area. We have welcomed the Bolton Committee's painstaking analysis of the problems of those firms. We agree with Bolton that subsidies are not appropriate, but we also recognise that some policies which were fully intended to be neutral in their effect on firms may not have been so in practice. We have already implemented several of the Bolton Committee's recommendations. A Minister has been appointed with special responsibility; we have created a small firms division; we have been raising the minimum level for the disclosure of turnover and directors' remuneration—
§ The Question having been proposed after Ten o'clock on Wednesday evening and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
§ Adjourned at fourteen minutes to One o'clock.