MID AND SOUTH-WEST WALES

HC Deb 16 January 1974 vol 867 cc696-738

11.29 p.m.

Mr. Denzil Davies (Llanelly)

I wish to raise as briefly as possible some of the problems confronting the people in my constituency and, indeed, in the area that can fairly clearly be defined as South-West and Mid-Wales.

On looking at the Estimates, it appears at first sight that this debate should be limited to something called Other Environmental Services, &c, Wales", but on making a few inquiries I have found that the salary of the Secretary of State is paid out of this Vote. The right hon. and learned Gentleman seems surprised. Perhaps he has not inquired where his salary comes from. My information is that it comes out of this rather large fund. Since that is the case and the right hon. and learned Gentleman has overall responsibility for economic matters in Wales, as well as other specific matters, I understand that it is not out of order to raise some of the economic considerations which are affecting the area.

As hon. Members will know, the area is a fairly mixed one in the sense that most of it is agricultural and dependent on agriculture but part of it, especially the part which I have the honour to represent, is mainly industrial. It is the only large industrial area in the whole of South-West and Mid-Wales. I should like briefly, therefore, to draw the attention of the Secretary of State and the House to some of the rather pressing problems which face this industrial area in this corner of South-West Wales.

I make no apology for telling the House, if it does not know already, that one of the major problems is caused by the three-day week. This problem affects not only my area but the whole of Wales over which the Secretary of State, together with his Cabinet colleagues, has overall economic responsibility.

The three-day week is grievously affecting industrial workers in my constituency. We have the tinplate industry, which is substantially affected, and this affects the whole economy of Britain. We have parts of the motor car industry, which again is substantially affected by the Government's decision to impose a three-day week. We have quite important engineering factories, which again are affected in this way.

What my constituents cannot understand is, first, why all this was necessary, because they are not convinced by the Government's propaganda. Secondly, they cannot understand the unfairness of it all, because in other parts of the country people are able to work for five days. A typist in a typing pool in London may have to do without a bit of light but she can work for five days and draw her full salary. Thus the unfairness of the imposition of the three-day week affects large numbers of people such as I have mentioned and the industrial areas to a far greater extent than it affects the service industries and the service areas of London and the South-East. My constituents ask themselves, therefore, why all this is necessary and why they should be singled out in this way whereas other parts of the country are not suffering so much.

The Government will say that this is all because of the miners. I do not want to pursue that argument, but I assure the House of one thing: that the workers in my constituency do not blame the miners of Wales or Britain for the situation in which they find themselves. If the Government believe that they will make the miners the scapegoat for the three-day week, I can assure them that as regards Wales—I can speak only for Wales—they are making a grievous mistake. People are not so stupid or ill-informed today that they will fall for the claim that all the problems of the three-day week have been caused by the miners.

The second problem is the way the Government and the mining industry are engaged in this locked combat, a confrontation which in my opinion is completely unnecessary. If only the Government were to look at the realities of the mining industry, the economics of the situation and the need to produce as much coal as we possibly can in view of the events in the Middle East, if only they would look at the situation realistically instead of sticking to a policy which was drawn up long before the Middle East war and long before the problems concerning oil arose, and if only they would realise that events have overtaken them, they would realise that there is no need to have this confrontation with the miners.

On any economic ground, on any ground which a Government of business men should understand and on any grounds of commerce, the miners are entitled to every penny for which they are asking. The Government, however, for their own reasons for face, pride, arrogance and the stupidity of their leadership are unable to come to a reasonable agreement with the miners.

There is a large anthracite pit in my constituency now short of about 400 men. There are a number of reasons, but one is that the wages there are not sufficient to compensate for the dangers and rigours of working underground. There is something wrong with an economic situation in which women in the motor industry earn more than men working underground at Cynheidre.

The miners are angry because the Government persist in saying that the National Coal Board's offer to the miners is 16½ per cent. This suggestion infuriates miners, for only a small proportion of those working at Cynheidre, the only large pit in my constituency, will receive anything like 16 per cent. The Government should get off their propaganda horse and forget about confrontation and pay the miners the economic rate.

That would not damage the country, for everybody knows that the miners are a special case, that the industry is, and always has been, a special case, and is even more of a special case in view of the price of oil and the difficulties in the Middle East. If the Government want the issue reduced to simple terms, every lump of coal that the miners get out of the ground means a saving in oil, thus a saving in the expensive dollars needed to buy oil, and in the past few days we have all seen how dollars have become more and more expensive.

If a settlement comes, as it is bound to come one day, whether before or after a General Election, the Government will have to make a massive investment in the industry, not only in South-West Wales but in other areas. Mining will still be dangerous, but it can be made a safer and easier job if massive sums are spent on capital equipment. Nobody wants to send men underground. Mining is dangerous and unpleasant, but we shall need the coal increasingly, and if we are prepared to spend vast sums we can to some extent ameliorate the difficult conditions underground.

The two major problems in South-West Wales are the three-day week and the Government's confrontation of the miners. My constituents blame not the miners but the Government for stupidity and arrogance.

The third problem that we face is lack of public investment. Some people have told us that Government expenditure has been too high, and that may have been true in terms of the amount raised in taxation. But the problem in the regions, as my hon. Friends know very well, is that public expenditure has not been high enough. One way in which to redistribute income from the richer to the poorer areas is to have high public spending in the regions financed by high taxation falling proportionately more on the wealthier areas. Higher public investment in regions such as ours serves two functions. It provides the necessary services. It also contributes to shifting some wealth from the wealthy parts of Britain to parts which are less wealthy.

My fear for the future, however, is that the Government—I am sure that they will—through a Minister at the Dispatch Box, will announce a very large loan from the International Monetary Fund. They are bound to do that, otherwise the country will rapidly become bankrupt. My fear is that the loan will have imposed upon it very stringent conditions, some of which will involve a substantial cutback in public investment and expenditure. That will damage the poorer regions, which need every penny of Government money which they can get.

No one can pretend that the problems of Wales or of Britain will diminish over the next few years. We have the gloomy predictions of the Governor of the Bank of England to back up all the other economic forecasts. But I am convinced that the problems which we shall face in the future will not be mitigated or alleviated by a Government whose whole philosophy seems to be based upon confrontation. If the Government cannot change their ways, their style of leadership and the philosophy of their leader, perhaps a General Election would be the best thing that could happen. The Government could then make way for a Government who were prepared to unite the country and solve the problems in that way, rather than exacerbate regional differences and class prejudices as the present Government seem determined to do.

11.42 p.m.

Mr. Nicholas Edwards (Pembroke)

My constituents are as much affected by the three-day working week as those of the hon. Member for Llanelly (Mr. Denzil Davies). But no one in any part of this country would be more catastro-phically affected by the collapse of the phase 3 policy, if that were to occur, than those who live in my constituency, most of whom do not have the protection of great unions but are engaged in small businesses, in farming or in tourism. Many of my constituents are retired people living on fixed incomes. The hon. Member called for a massive injection of funds into the coal industry, but he seems to have forgotten that the present Government have already introduced an Act with exactly that objective.

I understand that during an earlier part of the debate comment was made about my absence from the Chamber. There were two reasons for my absence. Partly, I was driven away after I had listened to the greater part of an excruciatingly boring speech by the hon. Member for Swansea, East (Mr. McBride). But also, more importantly, I was visiting my wife, who has just undergone a serious operation and is in hospital. If we are to have a General Election, I hope that it will not be characteristic of the tactics of the Labour Party to attack a Member of Parliament for his absence on such a duty. One notices, too, that many of the hon. Members who chose to attack me at 8.30 p.m. for not being present are not in the Chamber when the going gets a little rougher at 11.45 p.m.

I want to refer to one or two of the problems that confront my constituents in West Wales. There have already been a number of references to housing. This deeply concerns me because there are great housing shortages in Pembrokeshire, and local authorities have failed, in some cases seriously, to meet the challenge that they face. There was a sad failure to build houses in the Haverfordwest borough and rural district because it was believed that houses would become available in Brawdy. I thought that that was a great mistake, but it has happened.

I regret that the local authorities have not taken up the repeated invitation that I have extended, and the invitation extended by my hon. Friend the Minister of State, Welsh Office, for them to meet the Minister of State in order to discuss any particular problems they may have about conditions in which they have to operate. That invitation was extended on more than one occasion from the Dispatch Box, and it would have been valuable if the local authorities had taken it up. There are a considerable number of empty houses in Pembroke Dock awaiting a decision about the future of Manorbier and Castlemartin, and I hope it will not be long before they are released.

May I make a passing reference to agriculture? I shall be brief because I do not want to keep other hon. Members from their speeches. There is great anxiety among milk producers in West Wales, as elsewhere. They have been faced with rapidly rising costs for feed-stuffs and so forth. I hope that my right hon. and learned Friend the Secretary of State will be able to assure me that the price review is being pressed on with all haste, that there will be an early announcement and that the farmers will receive an increase in the amount they receive for milk which I am sure they deserve. I shall not specify the exact amount because it is better that the details should be put forward by the unions in the current discussions.

Mr. Elystan Morgan (Cardigan)

The hon. Member has honestly and forcefully put the case for the milk producers recouping their costs. Does lie agree with the contention that the Government should be condemned if they suggest that the limit of 1.6p a gallon set by the EEC on the amount that can be awarded to the farmers should be enforced?

Mr. Edwards

I am not prepared to answer hypothetical questions. We can discuss that point when it arises. It will probably prove to be one of the many myths perpetrated by the Opposition.

Communications remain as crucially important for the area as ever. I hope that my right hon. and learned Friend will be able to give us some reassurance about progress on the M4 and tell us what will be the effect, if any—I hope there will be none—of the cuts in road expenditure on the construction of that road. Any delay is much more likely to be caused by planning problems, and I hope he will tell us that progress is being made on that front, too. A good deal of minor road works is going on in the area which for the time being could be dispensed with. For example, the road from Fishguard to St. Davids and the road from Haverfordwest to St. Davids are both important highways—not least because I use them regularly—but it is not essential to straighten out every bend. I am far more anxious about construction of the main arterial links which are essential for our industrial life than I am about that sort of expenditure.

I welcome steps being taken—the legislation is currently going through Parliament—to make it easier for the rural areas to provide transport by mini-bus, private car and so on. That is vitally important.

Nothing has caused greater anxiety in the area than the provision of adequate hospital services. The problem has concerned hon. Members on both sides of the House. I am delighted to see the work going briskly forward at last on the construction of the new district general hospital at Haverfordwest. But there are two points of particular concern to my constituents.

First, we are not yet satisfied that it will be possible to run the accident unit with the comprehensiveness and efficiency that we would like. Senior appointments have been made, but it has not yet been proved that the proposals put forward can be sucessfully implemented, and that necessary assistant staff can be recruited. We shall continue to watch this sector of the hospital service with acute and critical attention.

Even more important is that we should have an adequate number of children's beds. I very much welcome the appointment of the new paediatrician who will live in the area. It is a great step forward, but it is not enough if he does not have enough beds in which to treat the children. I am satisfied that the present plans for the hospital do not include enough beds. I hope that the plans will soon be amended.

I turn to employment and industrial development prospects in my constituency. We have had three very good years, notably better than the three that went before. But I acknowledge that we have had the advantage of major construction projects involving oil refineries. Unemployment rates have been rising again towards those we found when the present Government came to power, but there are encouraging prospects if we can overcome the present industrial difficulties.

First, there are significantly more people in employment in the area than there were even two or three years ago. It is difficult to arrive at the exact numbers, because there has been a change in the method of calculation from one based on the old card count to a census, and there are extraordinary anomalies. It would appear that there were about 4,000 more males in employment in my constituency in June 1972 than there were a year or two before. I do not think that is right, but it is clear that there are probably about 2,000 more, and that is a significant increase.

The second encouraging factor is the developments that have taken place—the development of the rail and shipping facilities at Fishguard, the new factory, the Slimma factory, that has opened there, the reopening of one of the factories at Pembroke Dock and the reopening of Brawdy which will occur in a few months' time. All these developments offer new prospects for employment.

On top of that, we have the guarantee given by the Government, after I had intervened to achieve it, that the naval establishment at Pembroke Dock will be continued at least until other employment is provided. I am told that, following the decision to keep the yard going, it has been operating so successfully that there is now every reason to keep it going for purely naval reasons. The people responsible deserve congratulation.

The other and most important single encouraging factor for us in the area is the developments in connection with Celtic Sea oil. It is likely that Pembrokeshire will provide the base for at least five rigs during the coming drilling season and that we shall be a hive of activity. There will also be some shipbuilding, the first major shipbuilding development in the county for many years, because through the enterprise of the Hancock yard it looks as if we shall be constructing two or even four supply vessels for offshore work.

The Government have played their part in ensuring that these facilities will come to Pembrokeshire and to Wales in general. I am grateful for the co-operation which was received after I intervened to ensure that the naval jetty was made available. That was essential if we were to get oil operations out of Pembroke.

It will continue to be vital for the Welsh Office to play a full part, with the new Department of Energy, in preparing the infrastructure and services that will be needed. There is only one threat which is hanging over such bright prospects. That threat arises from last week's declaration by the Labour Party, which is one of sombre significance for Pembrokeshire, that it will nationalise the resources of the Celtic Sea and its related operations—for example, ship repairing, marine engineering and the ports.

We need urgent Government preparation of the infrastructure. We are threatened with action which will drive the oil companies away from Wales to Cork and to the Irish ports. What are needed are the Government grants that help to obtain shipbuilding orders, combined with local management enterprise, so that once again Pembrokeshire can become a shipbuilding centre. But that, too, is to be threatened by nationalisation. It appears that enterprising local businessmen are threatened with the possibility of becoming civil servants.

We need an IMEG report, or something similar, and a Welsh Council study of the industrial prospects, the communications requirements and the potential environmental problems. Instead, we now have a blight hanging over our bright prospects which could destroy our hopes. A dark Socialist cloud now hangs over the bright future of West Wales.

11.58 p.m.

Mr. Emlyn Hooson (Montgomery)

I am sure that the whole House would wish to sympathise with the hon. Member for Pembroke (Mr. Nicholas Edwards) on the illness of his wife, and express the hope that she will make a quick recovery.

I do not pay attention to the politics of the attendance register. Sir Winston Churchill made the most interesting observation that it was the lowest form of political attack. Members who indulge in it do not, by and large, enjoy the respect of the House.

Mr. George Thomas (Cardiff, West)

The hon. Member for Pembroke (Mr. Nicholas Edwards) started it.

Mr. Hooson

I shall not indulge in a parliamentary political squabble, save to say that the unhappy dilemma facing the electorate is how to get rid of the Prime Minister without installing the Leader of the Opposition in his place. That is an unhappy choice.

Mr. George Thomas

The electorate does not want to get your Leader.

Mr. Hooson

He is far better than your Leader.

Mr. Gwynoro Jones (Carmarthen) rose——

Mr. Hooson

To put the hon. Gentleman's mind at rest, that may be purely academic. Who knows what is going on in Downing Street at this moment.

An important fact which concerns the whole of Wales is that the oil sheikhs have demonstrated to the world at large something which few people seem to recognise sufficiently—namely, that the balance of world economic power and the balance of national economic power have switched from the manufacturers to the prime producers. Because of world conditions the prime producers of oil, just like producers in coal mining and farming, are, in a totally different position from that which they occupied a year or two ago. Our thinking has not kept pace with world developments and with the effect of those developments on the internal economic structure of this country.

It appears to me that on the Government benches only the right hon. Member for Wolverhampton, South-West (Mr. Powell) has shown any appreciation of this additional factor, which one would have thought should have greatly affected the Government approach to the present crisis.

Agriculture is the major industry of Mid-Wales and to a large extent, of South-West Wales, also. Grave miscalculations have been made by the Government in the handling of the agriculture industry. We have the Minister of Agriculture, who has joint responsibility with the Secretary of State, presenting across-the-board figures for agriculture which infuriate the Welsh dairy and livestock farmer.

Grain prices have increased enormously and grain farmers have done well, but the concurrent effect is that dairy and livestock farmers, who have to buy feeding stuffs, have been at the receiving end. They have to pay more than Common Market prices for the feed, while receiving nothing like Common Market prices in return.

The true situation, as you, Mr. Deputy Speaker, with your own rural constituency, will be aware, is that many livestock farmers have been suffering in a way of which the general public has been completely unaware.

Allied to this effect of the high feeding cost is the high interest rate. Added to that, the market has been flooded with cows which should have been kept for breeding.

One reason for the depressed market for barren cows and beef is that people are uncertain about the future, whereas the true world situation, the increase in transport costs, and the fall of the pound should impel the country to grow more food to ensure far more of our breeding stock for the future.

I have forecast that this country is facing a grave food shortage, and the Secretary of State would be well advised to pay attention to the agricultural distress which exists in many areas and regions today.

Many small farmers do not know what the future holds for them. I saw the other day that the President of the National Farmers' Union forecast large numbers of bankruptcies unless something was done. He was clearly referring not to grain growing but to the livestock section. I wonder what the Secretary of State will say about that. What is intended to be done on behalf of the farmer?

In connection with the Common Market, I do not think the Government should be inhibited in any way in modifying the common agricultural policy internally.

The economic reasons for entering the Common Market are at least less tenable than they were when we entered. The political reasons for the unity of Europe may be great, but the economic reasons for entry have weakened, and that is the true instinct of the whole country. Therefore, in assessing whether the Government can break or modify the inhibitions placed on them by the Common Market agreement, they should bear in mind that the countries of the Common Market have in the past frequently done that very thing.

The second point I want to make is this. In Mid-Wales and South-West Wales we suffer woefully from bad communications. At the same time the whole system of local government is being centralised. We have no assurance about the future of our railway lines ; bus services have virtually disappeared. Except by private car, it is almost impossible for a citizen to serve on a council in the new set-up in the area. The Secretary of State owes it to the people of that area to have an investigation of what public transport facilities are, and ought to be, available to ensure that there will be no more closures and that there will be adequate subsidies to provide adequate public transport.

My third and last point is this. One of the undoubted economic successes in my area has been the development of Newtown new town. I was always, as the hon. Member for Cardigan (Mr. Elystan Morgan) remembers, against the idea of a population of 80,000 for Newtown, Montgomeryshire. I much preferred the idea, for which the then Secretary of State, the right hon. Member for Anglesey (Mr. Cledwyn Hughes) settled, of increasing the Newtown population to about 10,000 or 11,000. That would have been much more acceptable.

Mr. Elystan Morgan

Although the hon. and learned Member was against the idea of a Newtown of 80,000 on the plains of Montgomeryshire, I do not remember his voicing any objection at all to increasing the population of Aberystwyth to 150,000. There was published a statement by him several years ago about it.

Mr. Hooson

It was a complete misrepresentation, as the hon. Member knows. There was a suggestion that Aberystwyth should be gradually increased, eventually to become, possibly by the turn of the century, the focal point, as it were, of Mid-Wales. Why the hon. Member should object to that I do not know. I understood that he had reservations about the Newtown proposals, and the bringing in of overspill population. I am sure he approved of my opposition to that plan.

I would have thought the hon. Member would have supported my view, which I have always taken, that the Newtown Development Corporation should not have been limited to one town. I have always firmly believed that the corporation should have power to develop all existing towns in Mid-Wales. We do not want in our area, which is largely agricultural, the small industrial towns to be developed out of all proportion to others. We would much prefer to develop Rhayader, Dolgelley, and others, so that people would not have to travel from those towns to find work in Newtown. All the towns in the area should be developed.

I would have thought, with the enormous increase in fuel costs, and the transformation of our society which will come about because of world and national pressures upon us, the correctness of my view in this matter to have been amply borne out, and I hope that the Secretary of State will have something to say about it.

12.8 a.m.

Mr. Gwynoro Jones (Carmarthen)

I congratulate my hon. Friend the Member for Llanelly (Mr. Denzil Davies) on attaining his place in the ballot so that we can have this debate on the important matter of the problems of Mid-Wales and South-West Wales.

My hon. Friend the Member for Cardigan (Mr. Elystan Morgan) inquired of the hon. and learned Member for Montgomeryshire (Mr. Hooson) as to Liberal policy of a few years ago. There is no need to inquire any more of the hon. and learned Member about that, for he apparently believes in a coalition Government under the right hon. Member for Orkney and Shetland (Mr. Grimond) and not his own leader.

The question of the problems of Mid-Wales and South-West Wales are important ; they are also many. The hon. Member for Pembroke (Mr. Nicholas Edwards) tried to disguise many of them. As he has personal family problems, I do not wish to concentrate too much on his speech, but to make a "passing" reference to agriculture in one of the leading agricultural constituencies in Britain was not doing justice to the people who sent him here. Perhaps, when the Government decide to call a General Election, we can deal with this matter in our own way in South-West Wales in the coming months.

South-West Wales is going through a period of confusion and bewilderment. The Government have built up the feeling of a crisis and then told us that there was not one, just as we were told to expect a tough Budget and then in December we got nothing of the kind. The Government's record in South-West Wales clearly shows the reason for this bewilderment and disillusionment. The hon. Member for Pembroke talked of the hopes for the future in terms of hospitals, roads and infrastructure in South-West Wales and Mid-Wales. By reducing public expenditure by £1,200 million with cuts on health and hospital and school building, the Government are not exactly investing in the future of areas like this. This uncertaintly also exists in coal mining and agricultural areas. There is great concern about where the Government are taking this country and our region in particular.

The other day I spent about four hours down Cwmgwili Pit, a few hundred yards inside the constituency of my hon. Friend the Member for Llanelly. While there, I thought of the hon. Member for Conway (Mr. Wyn Roberts), whom I have heard more than once on television or the radio talking about terrible plots being laid against the Government and the people by militant miners or their leaders. I thought that if he had come with me he would be much more careful about what he says. The people to whom he was referring are ordinary people who have lived ordinary lives in the ordinary valleys of Carmarthenshire and elsewhere, who have nothing of the sort in mind, and want only to make a decent living and give of their best for the country as they have done for decades.

Something sudden happened to another Conservative Member in Wales a few years ago when he tried scaremongering about the miners. He departed from the House soon afterwards. I will not say that automatically happens, but there are people down the pits earning £27, £29, £31, £33 and £36 a week. Four hours was enough for me to be down Cwmgwili colliery to realise that that sort of money is woefully inadequate for the work done.

The Prime Minister at the moment thinks that he might have an alibi for the mess the country is in, but there is a great deal of explaining to do about how the Government miscalculated the energy crisis, whose coming has been obvious for months to everyone. The tragedy is that the alibi now is taking our total concentration away from the Government's economic mismanagement.

I utter a word of warning on the Celtic Sea oil development. There are people in Wales who have made this a political platform because it seems they have nothing else to talk about. The finds, if they occur, may not be anywhere near the Pembrokeshire coast. Indeed, by 1985 it might be Cornish oil rather than Welsh oil.

The hon. Member for Pembroke said that the Government needed to think of the infrastructure and planning requirements, and I agree with him. The CBI has conducted a study into the needs of South-West Wales. The industrial development committee of the Carmarthenshire County Council has written to the Secretary of State asking him to convene a standing conference into the needs of South-West Wales so that we may avoid the pitfalls that have occurred in Aberdeen through bad planning. Aberdeen has a population of 180,000. The Milford Haven and Pembroke dock area is far smaller, so the problems will probably be much greater. The infrastructure must be considered, and the advantages for South-West Wales should come further east than Pembrokeshire.

Mr. Nicholas Edwards

I entirely agree. It is absurd to talk about Welsh oil when the first hole that was drilled was near the Isles of Scilly. We can provide the base. We want to be the advance base, but the main industrial development will spread right back through South Wales. I agree that we need the kind of planning conference that the hon. Gentleman asked for.

Mr. Jones

I raise the question of Welsh oil because of its immense possibilities for the Welsh economy. There are people who say that Wales has certain energy advantages. I remind those people that we get all our gas from the North Sea, and we shall have to get a great deal of oil from the North Sea for Welsh industry. Half a million houses in Wales get their natural gas from the North Sea. Wales certainly has coal, but the geological conditions make the mining of coal difficult.

I want to ask the Minister about the M4 motorway. A 1976 deadline has been promised by the Secretary of State for the Pontardulais bypass, but, again, the deadline is being pushed further into the future. If the road is not ready by that date future development in Pembrokeshire and Carmarthenshire will be pushed into the 1980s.

When the report on the railways is published, will it contain a section dealing specifically with Wales? The Welsh Council study will take another year before it reaches fruition. Will there be, in the Government's overall strategy, a major policy dealing with infrastructure and transport problems in the Principality? What plans have the Government got, albeit may be in the last few days of this Parliament, to co-ordinate the industrial, agricultural and tourist potential and to deal with the whole environment of Mid-Wales?

There was once a proposal by the Labour Government for some sort of body for Mid-Wales. That did not reach fruition. The Government dismantled the plans, yet three years afterwards there is still nothing of note offered as an alternative.

In the agricultural industry the increase in feeding stuffs has borne particularly heavily upon milk producers. It has badly affected poultry and pig producers, too. Carmarthenshire is one of the top three agricultural constituencies in Britain, producing 70 million gallons of milk a year and about £8–£10 million for the economy of the county. Yet it is going through a period when feeding stuffs have increased by 80–90 per cent. a ton. This is serious for milk producers who were not fully recouped in the 1973 review. It was hoped that four factors would help the dairy farmer—an increase in calf prices, a decline in feeding stuff prices, a continuation of the advancing milk yield and a rise in the price of calving cows. None of these factors has turned out as hoped. The industry is now crying out for assistance.

The special review procedure has been dismantled. This procedure operated until we joined the EEC. The Government have to begin convincing dairy and hill farmers in Wales of the advantages of joining the Community. From my personal knowledge and contact with farmers in my constituency, I know that they are not enamoured of the prospects at the moment. They are still looking for the advantages. They are paying today for 1977 EEC costs. Expansion is imperilled. There has been a major drop in the milk yield. Confidence is at a low ebb.

There are many other problems facing this area. The last occasion on which I spoke in the Consolidated Fund Bill debate I took 55 minutes. Mr. Speaker was not too pleased and did not call me for a while afterwards. I will not repeat that performance tonight. If I spoke for much longer the Prime Minister might have called a General Election and I would have to rush off to my constituency to make sure that the truth about the Government's policies towards the Principality and South-West Wales is known. We will not forget that the heart of the crisis—although we are currently concerned about the energy problem—lies in the blatant mismanagement of the economy for the past three years—from the days in October 1970 when public expenditure was reduced, and then increased by £900 million in 1971, then by £1,400 million in 1972 and then cut by £1,200 million today. We also had the cutting of investment plans in 1970, their restoration in 1972 and all the U-turns and so on.

Mr. Nicholas Edwards

The hon. Gentleman might care to go back to the mismanagement of six years earlier.

Mr. Jones

I am obliged to the hon. Gentleman for reminding me of an important factor to which I intended to draw attention. The Labour administration brought this country back to a balance of payments surplus of £1,000 million. People are now asking where it has all gone and why it has been frittered away.

12.25 a.m.

Mr. Caerwyn Roderick (Brecon and Radnor)

We sympathise with the hon. Member for Pembroke (Mr. Nicholas Edwards). However, we do not sympathise very much with what he said. He spoke about the danger of the collapse of phase 3 and said that no one would suffer more than the people of South-West Wales and Mid-Wales if it were to collapse. I suggest that phase 3 has collapsed. It is not about to collapse. It has led to a three-day week. If that was not the intention of phase 3, it is a remarkable result of such a policy.

I suggest to the hon. Gentleman that if he had not spent some time in mining areas, it would pay him to do so now so that he might understand what the miners are trying to tell his Leader and his Government. They are saying "If you want coal, either you must get it for yourselves or you must pay us for getting it." They have had just about enough of getting it on the cheap, as they have been. When they see brand new factories round them where they can get clean jobs with very good pay, they will no longer go down to do the abominable jobs that they have done throughout the years to get coal on the cheap. The Prime Minister had better decide that this is the situation. He cannot bargain with them as he has been doing.

The hon. Member for Pembroke also mentioned livestock feeding stuffs. The farmers in my constituency have not yet forgotten the phrase used constantly that they must now live off the fat. It was used by two Ministers. It was suggested that they had had a sunny period for a long time and that now they had to tighten their belts and live off the fat. Last year's price review was based on the expectation that we should have falling prices of livestock feeding stuffs. These have not come about. The farmers now expect a correction to be made.

The hon. and learned Member for Montgomery (Mr. Hooson) spoke about what was happening in the markets. He said that recently there had been a deliberate off-loading of cows because of the lack of confidence among farmers about the future of the beef and dairy cattle industry. He told us about their fears of what was ahead of them, with the result that they had decided that they could no longer afford to hang on.

Last week in a market in my constituency beef was fetching £11 or £12 per cwt" whereas six months ago it had been £21. The drop in price has been remarkable.

Mr. Gwynoro Jones

The farmers are also asking why the price to the housewife has not declined. When beef prices were at a disadvantageously high level, the Government instituted an inquiry. They have not instituted a similar inquiry into why the price of beef to the housewife has not dropped. Someone is profiteering.

Mr. Roderick

I do not pretend to know the answer to that question. I was discussing that very problem with farmers in my constituency on Monday evening. They could not provide an explanation for this remarkable drop in the price of beef, apart from the fact that there was a lack of confidence, and this off-loading was one suggestion being made.

I turn now to another aspect of agriculture—the shortage of various materials. There is a shortage of fertilisers and of packaging. We know that there is a shortage of packaging materials in other industries, and there is certainly a shortage of spare parts for machinery.

Some of these shortages do not arise by accident. Two years ago we warned the Government that if we were in the doldrums in production, nevertheless they should not allow the preparations for better days to go unattended but should ensure the production of certain raw materials for better times.

Any economist knows that, whichever party is in Government, there are ups and downs in the economy of this country. They go in cycles. We tried to ensure that the downs were not as low as this Government have reached. We tried to level them out. Nevertheless, the graphs of the gross national product show that production goes in cycles. In the lower part of the cycle the Government would not take heed of the warnings that they should have been preparing for better times.

There is now a better employment situation. This would have happened regardless of which party was in power, but we can accelerate that process. Now that we are reaching those better times we are totally unprepared. We are short of materials in every walk of life.

In an earlier debate about improvement grants reference was made to builders complaining that they could not get on with jobs because the raw materials were not available. I am aware of this problem in my constituency and in many other parts of Wales. Builders cannot get plaster board and various other essential building materials. I blame the Government for not being prepared for this contingency.

The problems of Mid-Wales have not changed or been eased in the past three and a half years. We have had three and a half years of talk by the Secretary of State about a growth towns policy. It has been talk, and nothing but talk, because he has done nothing to bring about a programme of massive investment in these growth towns.

I have been very fortunate in the past week because a friend passed to me a pamphlet which was issued by a Conservative candidate in my constituency during the last election. I should like to quote one sentence from it.

Mr. George Thomas

I understand that the gentleman concerned is to be my opponent.

Mr. Roderick

He will be very fortunate in having my right hon. Friend the Member for Cardiff, West (Mr. George Thomas) as his opponent, for perhaps his education will be further advanced. In this pamphlet he says: Plans for strengthening Mid-Wales towns will be supported. I am sure that my hon. Friends would be delighted to hear about such plans. That was in 1970. We have heard nothing further. Newtown has gone ahead, but that has come to a halt. We are happy that it should have reached this stage, but it is time that we moved on to other towns. The Secretary of State has talked endlessly about the growth towns policy, but nothing is happening.

In Mid-Wales a depressed area has been set up. I should like to draw the attention of the right hon. and learned Gentleman to the level of average wages in that area. I am told that the average wage in Mid-Wales at present is £1,280 a year. The average wage in the crofting counties in Scotland is £1,341 a year. The Secretary of State for Scotland seems to have succeeded in getting a better average wage for the crofters of Scotland than is enjoyed by the people in Mid-Wales. The average wage for the United Kingdom is £1,548 a year, which means that there is a difference of about £250 between that figure and the figure for Wales. People in my area are expected to live on £250 a year less than the national average. Is that because it is thought they can live more cheaply? In fact, the reverse is the case, and their expenses can be much higher than those of people living in any other part of the United Kingdom.

Ever since they took office the Government have been throwing on to local authorities more of the burden of collecting their own income. For instance, this week the new Welsh National Water Development Authority has suggested that people will have to pay three or four times as much in water charges as hitherto. Is that why the authority was set up? I understand that the reason for the suggested increase is that the Government are withdrawing their support from water rates and are asking the authority to charge a realistic price for water. There is an abundance of water in Mid-Wales—and this is an amenity shared by the hon. and learned Member for Montgomery—yet the people there will have to find this extra money.

We have been waiting since 12th December for the White Paper giving the result of negotiations on the rate support grant. At a meeting in London last week we were told by the Minister for Local Government and Development that it would appear within a matter of a few days, but a week has gone by and nothing has happened. We know that there have been revisions during the negotiations, but the original negotiations led us to believe that Mid-Wales would suffer to the extent of having to bear a 60 per cent. increase in the rate burden.

The Secretary of State has often said that we are exaggerating and that we have not got the facts right, but how can we know the true position without the facts? It is high time that we learned the truth. If the Secretary of State has been deceiving us all along the road, he will have a sorry tale to tell when the figures are published. In addition to withdrawing the rate support grant, we are to suffer the Government cuts in expenditure that were announced in December, and all these things add to the burdens of the people in rural Mid-Wales.

I should now like to touch briefly on the question of transport in the area. I do not see much change in the pattern of public transport in Mid-Wales, and I should like to draw the right hon. and learned Gentleman's attention to another statement in this magnificent document with which I have been presented. It says: The Socialist Government has failed to control the cost of living."— What a joke that is. Communities such as ours"— that is in Mid-Wales— which are so dependent on motor transport have been worst hit. A Conservative Administration will tackle this problem. It needs to be tackled and only we can do it. Before giving that quotation I said that I had not noticed much change in the pattern of public transport in the area, but I have noticed one change, and that is that recently the prices of oil and petrol have increased considerably. The Secretary of State will no doubt say that that is not the Government's fault and that it is the Arabs who are to blame, and they blame world prices for increases in our foodstuffs, but they could if they wished intervene to keep down prices here. Instead, they are dogmatically opposed to providing subsidies. The Prime Minister is extremely stubborn about so many things, and that is another aspect of the Government's unwillingness to recognise that they could help to make life easier for people. Most people in Mid-Wales travel considerable distances to work, and petrol and oil are major factors in their lives. The Government could do a great deal to alleviate the situation in this area.

We in Mid-Wales have suffered the closure of many of the facilities which led to an easing of life in the area. We have had the closure of gas showrooms, we have a lack of electricity showrooms and we have the closure of sub-post offices. The Secretary of State might well argue that these have nothing to do with him and are the concern of those various public bodies. I suggest to him that if he is concerned in these matters he could well advise local authorities to take on a new rôle and let them have the power to assist in many ways in combining the work of all those public corporations in places where they cease to exist.

We have lately suffered postal deliveries and collections which are farcical under the new emergency timetable. In various rural parts we have the one collection of the day being made at 8 a.m. In those parts we have the added inconvenience of having the worst service in many respects.

Like my hon. Friend the Member for Carmarthen (Mr. Gwynoro Jones), we in my constituency do not have much evidence of the European Economic Community's benefits to Mid-Wales. We thought that a magic wand would be waved and that last January things would change abruptly. A year later we have very little evidence of this. I hope that in his reply the Secretary of State will touch upon the benefits that we can now expect to accrue from our membership of the EEC. We are told that hill farmers can expect benefits, but they are nothing like the benefits we would have had under a Labour administration acting independently.

12.42 a.m.

Mr. Elystan Morgan (Cardigan)

We have had as spirited and wide-ranging a debate as we would have had if this had been a Welsh day. We are grateful to the benign fates that have made such a debate possible, although it is likely by now that there will be no further Welsh day in the lifetime of this Parliament.

I should like to follow up a point made by my hon. Friends the Members for Carmarthen (Mr. Gwynoro Jones) and Brecon and Radnor (Mr. Roderick) as well as by the hon. and learned Member for Montgomery (Mr. Hooson) concerning production costs, particularly in the context of milk production. It gives me no pleasure to remind farmers in my constituency that over the years it has been my case that a small increase in the end price would be greatly offset by rising production costs that would very soon shoot through the ceiling. That has been what has happened during the last six months. The atmosphere in Mid-Wales among milk producers is one of fear and despondency.

It is clear that unless there is a massive recoupment, and unless the Government say to the powers which regulate such matters in the EEC that they will not be bound by any ceiling of an increase of l.6p per gallon, hundreds and, indeed, thousands of milk producers in Mid-Wales will be leaving the industry. They are in the main people who do not have the capital, the turnover or the size of units to enable them to convert to beef and still remain in agriculture. When that happens, not only will it be a blow to the great industry of agriculture, but it will sabotage a pattern of a way of life in the countryside, for agriculture is much more than an industry—it is a way of life.

I therefore urge the Secretary of State to use whatever influence he has in the Cabinet in the context of the coming price review to belabour the point that this loss cannot be allowed to continue without grave damage being done to Welsh agriculture and to the Government's whole policy of self-sufficiency in agriculture. We are not very far from the day when milk rationing may have to be introduced. When 1977 comes, bringing the end of the transitional period, it may be possible for more cheaply produced European milk to come to Britain, and we may then see thousands more milk producers driven out of the dairy industry.

While on the subject of milk production, I should like to introduce a topic not yet mentioned—the future of the Milk Marketing Board. The board has been a great security and a source of strength and certainty to farmers in Wales ever since it was established in the early '30s. The main source of the stability given by the board is that it is able to impose practically a uniform price for all milk producers, within the grades of milk produced, irrespective of where the market for that milk lies. If that were not so, Welsh milk producers, those such as mine in Cardiganshire who sell 75 per cent. of their milk outside the county, would find themselves facing a heavy impost of several pence per gallon to cover transportation costs, and many would be driven out of the industry on that account.

For all the demands made by both sides of the House about this matter, the milk producers of Britain are still without a firm assurance from the Government about the future of the Milk Marketing Board as a powerful body with authority to impose a uniform price in this all-important sector.

I should like also to mention the subject of compensation payments to persons whose cattle are slaughtered under the compulsory eradication area brucellosis scheme. In my county we have now reached the high clearance figure of about 97 per cent. Cardiganshire is proud of having shown such a pioneering spirit in the eradication of tuberculosis many years ago and of being able to show such splendid progress in this direction, too.

But there are many instances of grave hardship. There are disputes, naturally enough, about compensation when persons have been receiving a bonus for brucella-free milk, but when they have been getting only 75 per cent. of the value of a slaughtered animal, I agree with them that there is no real reason why they should not be fully compensated on that account, for the difference of 25 per cent. is much greater than the benefit that they would have received, especially if they have received it for only a short period.

But the serious discontent is about the 60-day period when all the animals in a herd are slaughtered as actual reactors or dangerous contacts. The land must be kept completely free of cattle in the meantime, and there is no income for a substantial period. Then, at the end of that period of 60 days—or more, as it often is in practice—the farmer may find himself having to begin again with a process of building up a herd which in the first instance may have taken him as long as 30 years. It is quite wrong that such a person should be left completely uncompensated for that very serious loss.

I know that successive Governments have taken a tough line in relation to income loss in the context of slaughter, be it for foot-and-mouth disease, brucellosis or any other comparable animal disease. Nevertheless, there is here a strong and compelling case for the payment of some form of disturbance grant for people who find themselves set back many years. Some of them, as I know from experience in my constituency, are completely ruined by the absence of such a payment.

I turn now to the general problems of Mid-Wales. Over the last two decades Mid-Wales has been the subject of a plethora of surveys. It is the best studied and most assiduously analysed part of the United Kingdom. Nevertheless, it remains the most extensive area of England and Wales which suffers rural depopulation in an acute form. All the evidence from these surveys points to exactly the same solution. That is that it is impossible to deal with each and every one of the problems of Mid-Wales as though they were separate factors wholly distinct and unconnected with each other. The solution lies only in giving some authoritative well-financed body a wide remit, with the power to look at the situation in its totality and to deal with all these various problems treating them as the different facets of one central situation.

That situation is one of a debilitated economy and an area that is steadily suffering from depopulation and a high rate of outward migration of its young people. There has been no dispute about the findings of successive surveys and the solutions which they have proposed, which have almost the same tenor and theme.

But that is exactly what the present Government refuse to do. They refuse to deal with the problems of Mid-Wales in a dynamic and comprehensive way. The only body which at present has a remit covering the totality of the situation is the Mid-Wales Industrial Development Association. When I say "the only body", I do not intend to refer to that splendid institution in a pejorative way. On the contrary, in the 16 years of its existence the association has been responsible for noble efforts and its work is truly distinguished. It has managed to found 75 new factories in Mid-Wales, it has created thousands of new jobs and it has been directly responsible for the attraction of well over £300 million of public investment to Mid-Wales.

I pay the highest tribute to the secretary of the association, Mr. Peter Garbett-Edwards, and to its chairman, Mr. Llefelys Davies. The association, however, has operated very much on a shoestring. From successive Governments it has received a paltry sum of a few thousand pounds per annum. No one would deny that that is the clearest example of a very successful public investment. I doubt whether there is any instance of Government expenditure showing so bountiful, direct and swift a return on a very small, modest investment.

For Mid-Wales the Labour administration which left office in 1970 relied substantially upon three policies. One was the general effect of the investment grant policy, which was of great relevance for many small firms in Mid-Wales. It provided them with substantial amounts of money to assist their cash flows in the first faltering months and years of their existence, and the benefit derived from such direct payments could not in any way be compared with the benefits which, perhaps in theoretical terms, may be calculated to derive from investment allowances. If these firms were making a roaring profit perhaps the two situations could be compared. But since most of them did not make a profit in the first uncertain years the benefits of investment grants were in a different universe from the investment allowances favoured by the Government.

The second policy was that of the growth towns. Six towns were designated in August 1969. When the Tory Government took over they said they would follow the same policy as their Labour predecessors. All that now exists is the dignity of designation. The grandiose title exists but there are few additional resources. The towns are, by the edict of Government, rich in status but scanty in wealth. The acid test of the Government's integrity in this matter can only be their willingness to divert substantial resources to these towns. They have had their chance, and they have not done so.

Aberystwyth is an example. It is the only town with a population of more than 10,000 in Mid-Wales. It is the largest town in my constituency. Under the Labour Government between 1966 and 1970 two advance factories were designated. The second was completed after Labour left office. Under the present Government no advance factory has been built at Aberystwyth. An industrial estate of 60 acres has been purchased and all the services have been established by the local authorities concerned. It has taken a long time, and complicated problems have had to be overcome. I beg the Secretary of State to use his good offices now to make certain that a substantial pilot factory is established on that estate in order to give it every reasonable chance to succeed. Aberystwyth and the economy of North Cardiganshire and of Mid-Wales generally need such a development.

The area of Aberystwyth calls for a broadening of its economic base. A high percentage of the male and female jobs are in service industry and only a disproportionately small number derive their livelihood from manufacturing industry. For the whole of Cardiganshire the figure is only 9 per cent., and that is the lowest figure for any area in the United Kingdom.

The third policy relied upon by the Labour Government was that of establishing a rural development board in mid-Wales. This has been referred to by the hon. and learned Member for Montgomery. I do not want to cross swords with him yet again on this matter. We have had a number of clashes in the House. I have still not completely forgiven him for the attitude he took in those vicious years of 1969 and 1970. In mitigation it may be pleaded that at the time a vigorous political campaign was current in Wales. Undoubtedly many of the persons who so raucously and unreservedly condemned the establishment of the Rural Development Board at the time have had second thoughts. I will not embarrass them by naming them, but I can give the hon. and learned Gentleman the assurance——

Mr. Hooson

I should like the hon. Gentleman to name them.

Mr. Morgan

It would not be fair that matters given in confidence should be stated in public. Nor will I name the gentleman who had tea with me in the House in 1967, when the board was first mooted, and begged me to use my influence—God knows, it was very little—with the Ministers of the day to see that he was a member, and who within three months, when the list of members had been published, was a leading detractor of the board. We will name no names, and thus avoid embarrassment all round.

I took the point made fairly by the hon. and learned Gentleman about the need to consider a body that would presumably incorporate all the functions of the Rural Development Board but would also have wide functions in relation to industry. I think that the board would have been better balanced if it had been constructed on that basis in the first instance. My own plea for a board of the type of the Highlands and Islands Development Board, established by the Labour Government in 1965, has been voiced in the House from the time I was elected in 1966.

If the hon and learned Gentleman now says that if the compulsory powers—powers which were in the 1965 Act in relation to the Highlands and Islands Development Board—were not included he would not object to the establishment of such a body in Wales——

Mr. Hooson

What Mid-Wales needs is an extension of the mandate of the New Town Development Corporation to develop the towns of Mid-Wales.

Mr. Morgan

I do not think that the benefits, extensive though they be, under the New Towns Act of 1965 should be limited to the towns. There are massive powers in that Act. I think the hon. and learned Gentleman will agree that the Highland Development (Scotland) Act 1965 gives to rural areas in general the sort of assistance given to urban areas in the New Towns Act of the same year. Therefore, I do not think that there is any massive issue of principle dividing us.

The Government of the day could have been more subtle if they had established a board for the Pennines first. There would have been shrill cries of objection from the Welsh Liberal Party and self-righteous bawlings from the Welsh Nationalist Party, and then the Labour Government, with great magnanimity, would have conceded the point and established the Rural Development Board in Wales with no objection.

When the next Labour Government take office—we hope that it will be soon, but that depends very much on the Prime Minister's co-operation—I am confident that we shall see established a board which will have the functions we have been talking about, the main functions of the Highlands and Islands Development Board, allowing substantial assistance to be given to urban as well as rural areas, to agriculture as well as industry. But I also believe that people's minds have been so poisoned by the miserable events of 1969 and 1970 that it would be politic not to include in the powers of such a body the compulsory powers which were the source of so much objection in 1969 and 1970. It was always my case that those powers were minuscule, so cabined, cramped and confined that it was unlikely that they would ever be used. I must follow the logic of my argument and say that if that is so, as I believe it to be, one can abandon them completely. It is on that basis that I should like to see established a development authority for the Welsh Countryside of Mid-Wales as well as for the towns.

We could talk at great length about the general problems of Mid-Wales but I appreciate the lateness of the hour and the fact that there are many debates still to come. In the face of all the possibilities, and against a background of everything that was attempted by the Labour Government and the blueprints that that Government left, the present Government have managed to achieve monumental inactivity.

I join with what has been said about Newtown. Some months ago I took the opportunity to visit it. I was greatly impressed. It is an aesthetic development. It has all the appearance of being a close, compact and dynamic community. I am glad to see it on that scale, but perhaps not for the same reason as that which was put forward by the hon. and learned Member for Montgomery. I believed that a town of 80,000 would have acted as a syphon upon dozens of small towns and villages in Mid-Wales and would have denuded them of the scarce resources which they already had.

The Government have failed completely to meet the main challenge of Mid-Wales. I grant that they have carried on the policy of their predecessors relating to Newtown and that Newtown is a success. I accept that the development of Newtown has been almost that which was projected by the planners three or four years ago, and that there is every reason to believe that the development will continue unless there are some substantial and miserable supervening events in the general economy, which may be the case.

The Government have failed completely to apply their minds to how best to assist the western side of Mid-Wales. The real challenge is to assist the towns which are one hour's extra travelling time from the centres of the Midlands, which makes them almost completely unattractive. I refer to that half of Mid-Wales which will never really be serviced by a natural flow of resources from the Midlands. It is that challenge which the Government have sought to ignore.

The position will deteriorate rapidly. When reorganisation comes on 1st April the momentum of development which has been exercised by the local authorities will largely be lost. The position will be made worse by the substantial loss of rate support grant, the exact amount of which will undoubtedly be announced within the next few days. We must also remember that many authorities will lose the powers which were so important to them in attracting industry to their areas. They will become more like parish or community councils. With every respect to such bodies, they will not be in a position to attract industry directly.

We must also consider the three-day working week. There are few parts of the United Kingdom which will proportionately suffer so gravely as Mid-Wales in consequence of the Prime Minister's lunatic decision. The three-day week is unnecessary. We believe it stems from the Prime Minister's arrogance and pride. We believe that it is basically a form of medieval blood-letting to abstract from the economy the £2,000 million which he should have taken out by a fair and equitable Budget. That is the very thing the Government would not do. We believe that in the same way as a tree dies in the extremities of its branches, so it is exactly that sort of firm, the small firm in the outward periphery of Wales, which will suffer. It is here that we shall see the worst, most direct, and the first disastrous effects of the three-day working week.

We are disappointed that the Government have done nothing about the diversion of Government offices to Mid-Wales. We are disgusted that the Government have seen fit that we should wait for a number of years for the Highlands and Islands Development Board type of development.

I should like to appeal to the Secretary of State to exercise his initiative, but the relevant decisions are not made at Gwydyr House, in the Welsh Department, but at the Treasury, as the right hon. and learned Gentleman the Secretary of State openly admits. He is the puppet of the Treasury in this matter, but it is a grave injustice for Mid-Wales, and Mid-Wales will have to wait until a new Government, a Labour Government, have been established and then they will have the privilege to meet, in Mid-Wales, the challenge of the decay and malaise which have bedevilled that region for so many years.

1.12 a.m.

The Secretary of State for Wales (Mr. Peter Thomas)

All who have taken part in this debate will wish to congratulate the hon. Member for Llanelly (Mr. Denzil Davies) on his good fortune in the ballot for this important debate on Mid-Wales and South-West Wales. He did not make the best of his good fortune because he seized the opportunity to make a speech worthy of his right hon. Friend the Member for Bristol, South-East (Mr. Benn). He did not make a speech which highlighted the problems of South-West Wales or, indeed, pointed in any way to the situation there. He made a speech which was wholly divisive and designed to cause even greater problems for his area and for the nation generally.

The hon. Member referred to the coal miners in terms which we now hear so frequently from hon. and right hon. Gentlemen opposite. I understand why he and his hon. Friend the Member for Carmarthen (Mr. Gwynoro Jones), representing, as they do, people who work in the mines, and also being associated, as I know the hon. Member for Carmarthen has been, with people connected with the coal mines, make speeches which demonstrate their affection for people who work in the industry. However, it comes ill from any of the hon. Members opposite today, at a time of crisis in the nation, to strike the attitude they are striking now.

Who would think, to listen to the speeches from the hon. Member for Llanelly, that he belongs to a party which closed dozens of coal mines? Who would think that he belongs to a party by which tens of thousands of miners were made unemployed when his Government were in office? All the matters he mentioned were divisive. He did not mention that this Government in the last three and a half years have passed a Coal Industry Act, an Act which is acclaimed by all objective people interested in the mines. He did not mention that it is an Act which reverses the policy of running down the coal mining industry. He did not mention that it is an Act which gave an extra £100 million for redundant miners. He did not mention that it is an Act which increased the contribution to miners' pensions by £40 million, or that it is an Act which provided a regional grant of up to £210 million to be spent on uneconomic coal mines.

There is no doubt that miners have to work hard. There is no doubt that miners work in a situation which is hazardous to health and to body. Nevertheless, I remind hon. Members of what my right hon. Friend the Secretary of State for Trade and Industry said in a debate the other day, that what is said by hon. and right hon. Members opposite is humbug when they passionately argue today how under-paid miners are compared with other sections of the community.

When we took office three and a half years ago the earnings and allowances of face workers in the mines, still working hard and running risks, as they do, were £25 a week ; pay and allowances of the surface workers were less than £21.50. The improvement in the six years of the Labour Government, having taken into account the cost of living, was far less for the miners than it has been in the last three and a half years. In six years of Labour Government the earnings of face workers rose by £4 a week. In the past three and a half years the earnings have risen by £13. If Members of the Labour Party were able today to talk of a record such as that, if they could talk about a Coal Industry Act—which they did not bring in—if they could talk about this improvement in miners' pay, they would be talking of an achievement worth proclaiming. Instead, they have talked of nothing but divisive points.

Mr. Elystan Morgan

Does not the right hon. and learned Gentleman consider it strange that a Government willing to pay out to the coal industry and miners and retired miners a totality of hundreds of millions of pounds under the Coal Industry Act should now burke at a settlement which would mean only 2p extra per hundredweight of coal and that they are willing to plunge the whole country into chaos in withstanding a claim of that nature?

Mr. Peter Thomas

The hon. Member knows perfectly well that the matter at stake is the whole of the counter-inflationary policy. He knows perfectly well that the offer which has been made to the miners is the best offer that has ever been made to them in negotiations. He knows perfectly well that it is the intention of the Government to get down to discussing the future with the miners because it is important that their future should be assured. He knows perfectly well, too, that if the miners were to break through the counter-inflationary policy the effect on the country would be disastrous. Therefore, I do not accept what he says as being any solution whatsoever to the problems we face today and, in particular, to the problems of vulnerable areas such as Wales.

Mr. Denzil Davies

I accept that the miners have had an increase since 1970, but would the right hon. and learned Gentleman not agree that the last major increase they had was as a result of industrial action and the Wilberforce inquiry, and that it was not an increase given by the Government graciously, but forced out of them? Would he not agree that the next increase they will get will be, again, as a result of their action, forcing it out?

Mr. Peter Thomas

Yes, I can understand what the hon. Gentleman is suggesting—that the only way one can gain what one wants is by industrial action. He has forgotten the miners' settlement in stage 2, and that the Wilberforce award, was one which the Government accepted, having set up Wilberforce. Their present agreement does not come to an end until March. The hon. Member seems to think it right that there should be industrial action at the moment—because it is industrial action—the effect of which is the three-day working week of which he is complaining and which he says is the one major problem in his constituency. That three-day week could come to an end if the industrial action ceased, and those people in his constituency who have been working in a situation better than they have ever known—the lowest unemployment for years—would be able to return to normal working.

The hon. Member for Brecon and Radnor (Mr. Roderick) said "The problems of Mid-Wales have not been changed at all in the three and a half years." That, of course, is a gross exaggeration——

Mr. Roderick

I did not say that.

Mr. Peter Thomas

For Mid-Wales, South-West Wales and, indeed, other parts of the Principality, 1973 was a year of notable and encouraging development. Considerable progress was made in strengthening and diversifying the economies of both these areas. There were real signs that the fundamental and longstanding problems of unemployment and rural depopulation were at last being overcome. An air of confidence was apparent throughout almost the whole of the area. The employment situation in Llanelli had been transformed ; Pembrokeshire looked forward expectantly to the exploration of the Celtic Sea ; Newtown was actively building up its population and industry ; and the foundations had been laid for the further development of the other growth towns in Mid-Wales.

The difficulties we now face as a nation will inevitably mean some loss of momentum in this part of Wales, as elsewhere. There is no getting away from that. But if we can solve—as I hope we can—these immediate difficulties, there is every hope for the continued growth and development of these areas of Wales. The year 1973 proved what can be done.

It is interesting that, when referring to these parts of Wales, one has always referred to the areas of depopulation. There has been a significant improvement in that situation in Mid-Wales. After many decades of depopulation, the five counties of Mid-Wales are now again experiencing an increase in the number of their inhabitants. The rate of population loss in the decade 1951–61 was 3.4 per cent. Over the following 10-year period, the rate dropped to 2.3 per cent.

Recent figures indicate a continuation of this pattern of improvement. Indeed, they show that between mid-1971 and mid-1973 the population of the five counties of Mid-Wales actually rose by 2,100, or 1 per cent. The natural change was still negative, but this was more than counterbalanced by a net change of nearly 2,900 in other components, primarily migration. [Interruption.] If the hon. Member for Brecon and Radnor does not like these figures, I hope that others do. They demonstrate that for the first time in years there has been a net inward migration in Wales, in particular in his constituency. From being in a position where net outward migration was running at 500 a year between 1961 and 1971, Mid-Wales has now reached a position of net inward migration—1,200 between 1971 and 1972 and 1,600 last year.

Mr. Roderick

I should like to take the right hon. and learned Gentleman back a little way in his speech. He quoted me as saying that the problems of Mid-Wales have not changed and that nothing has been done. That is not what I said. I said that the problems have not changed. I did not say that nothing had been done. How does the right hon. and learned Gentleman compare the increase in population in Wales with the national increase in population?

Mr. Peter Thomas

That is rather a bad point, because we are dealing here with an area that has suffered depopulation. When there is a reverse in that trend so that for the first time there is a net inward migration, that is to be welcomed. If the hon. Gentleman does not understand that and does not welcome it, he is not interested in the area he represents.

I took down what the hon. Gentleman said, and if he looks it up tomorrow he will see that he said that the problems of Mid-Wales have not been changed at all in the three-and-a-half years. He said that there had been lots of talk about growth towns but nothing had been done. He said that nothing was happening. That gives me the opportunity to say something more about what is happening in the growth towns.

I think the hon. Gentleman will agree that the trend I have mentioned is an encouraging one because, with one exception, the designated growth towns all experienced an increase in population between 1961 and 1971. In Newtown that amounted to 10.8 per cent., in Welshpool to 11.4 per cent. and in Brecon to 9.3 per cent. Over the past two years the population of all the growth towns, without exception, has increased. Industrial development, too, has proceeded at a most encouraging rate, and factory projects promising well over 2,000 jobs have been approved in the growth towns in the last seven years.

The hon. Members for Carmarthen and Cardigan (Mr. Elystan Morgan) both mentioned proposals akin to the Highlands and Islands Development Board. There is now a considerable body of evidence that existing policies, which have been accepted and carried on from the previous administration in large part, are both appropriate and successful. Therefore, I believe that we must approach the question of new policy initiatives in Mid-Wales with great care.

The Welsh Council published last year a report on the growth town programme which was the outcome of a very detailed and comprehensive study. The Council took the view that the case for establishing a body on the lines of the Highlands and Islands Development Board for Mid-Wales could not then be made out. This judgment was based on its assessment of the problems of Mid-Wales, its view of the effectiveness of our present policies and the knowledge it gained of the work of the Highlands board from visiting Northern Scotland. It was a considered judgment and one which should not lightly be set aside. For my part I agree with the council that a case cannot be made out at present for establishing such a body.

Mr. Elystan Morgan

May I put, in as non-controversial a way as possible, the point that the judgment of the Welsh Council that there was no need to establish a Highlands board type of body in Wales seems to have been based on the consideration that the assistance channelled to Northern Scotland by the board was in many cases either channelled or capable of being channelled through agencies which already existed in Mid-Wales? This was a fundamental mistake, because the council failed to observe an element which has been the basis of the studies made of Mid-Wales over the last 20 years ; namely, the absolute need for a body with comprehensive powers to deal as one entity with all these problems at the same time.

Mr. Peter Thomas

I understand that the view of the Welsh Council is debatable. I understand that the hon. Member holds a contrary view, which he has expressed forcibly and effectively. The Welsh Council has gone into the matter with considerable care, and it seems that this is a considered judgment which must not be set aside lightly. For my part, I feel that a case cannot at present be made out for establishing such a body. I am not saying that in certain circumstances a case could not be made out.

The Welsh Council also considered very carefully a proposal, frequently made, that the Mid-Wales (Newtown) Development Corporation should take over responsibility for the development of other growth towns in the area. I have repeatedly made clear my view that the corporation's first task is to ensure the success of Newtown. The corporation has unquestionably achieved a great deal. Newtown has an air of prosperity and confidence that is apparent to everyone who visits the town. Unemployment there was running at only 1.7 per cent. in December.

But it is not altogether easy to establish the measure of that success in quantitative terms. Because of the difficulty of determining with any degree of precision exactly how the population is changing in a comparatively small area, I have taken up the Welsh Council's suggestion that a special survey should be undertaken of the population of Newtown and the surrounding areas at the end of 1973. The field work involved in this study has been completed. The analysis will also be completed very soon. In the light of our findings we shall be in a position to judge much more accurately the progress that has been made in the Newtown area in terms of population growth.

I must again emphasise, however, something I have said many times. Population change is only one factor among many which need to be considered before a firm judgment is reached on what has been achieved in Newtown in relation to the resources that have been committed.

The question of an extended remit for the Mid-Wales (Newtown) Development Corporation must, of course, be looked at in the context of the major reorganisation of local government that will take effect in April. We must think very carefully before setting up new arrangements for the development of Mid-Wales that do not give the new local authorities an opportunity to exercise their vigour and imagination in this vitally important area.

No Government can solve the problems of Mid-Wales without the active support of the people and the elected representatives of the people of Mid-Wales. In my view, it would be wrong to deny the new local authorities an opportunity of participating in this work. That is one important factor which I must take account of when I am considering the responsibilities of the Mid-Wales (Newtown) Development Corporation.

I hope that I shall be forgiven if I do not reply to many of the matters raised in the debate. However, I wish to refer to some of the factory building which is taking place. Much has been achieved here. But a lot remains to be done. Some six months ago I announced an intensification of the Government's factory building and related activities in Mid-Wales. The development commission has contributed substantially to this.

Since this Government took office in June 1970 we have authorised the construction of 27 new factories or nursery units in Mid-Wales. But factory building on its own is not enough. Housing is another important matter. With this in mind, the development commission is expanding its scheme of guaranteeing the rental of houses built by local authorities. This scheme diminishes the risk which a local authority otherwise would have to face in building houses in the growth towns.

The intensification of our existing policies towards Mid-Wales which I announced a few months ago is essentially a matter of reinforcing success. The growth towns are now in a position where their development can be accelerated. This development can be helped from time to time by the decision of non-manufacturing units to move to Mid-Wales. In this connection I welcome, as I am sure do right hon. and hon. Members on both sides of the House, the decision of the Welsh National Water Development Authority to locate its headquarters in Brecon. This decision will mean a very welcome addition of employment—and diverse employment—in that town.

Turning now to South-West Wales, the picture again is one of progress. I referred earlier to the encouraging population figures for Mid-Wales. The same significant trends are apparent in Southwest Wales. Carmarthenshire and Pembrokeshire together had annual net outward migration of about 400 a year in the 1960s. In contrast, they experienced net inward migration of 700 in 1971–72 and 1,400 last year.

The Lanelli area is unquestionably one of the success stories of regional policy. Not so many years ago this part of Carmarthenshire was in the throes of a major restructuring of its industries. Having been Parliamentary Secretary to the Ministry of Labour at the time, I remember it well. The old hand tinplate mills have now gone, and in their place there are modern factories employing many thousands of people.

From a position of disturbingly high unemployment, Llanelly has moved to the point where its unemployment rate is not only well below the Welsh average but substantially below the United Kingdom national average. The hon. Member for Llanelly did not mention that. It was 1.5 per cent in December 1973 compared with a United Kingdom national average of 2.2 per cent. Neither the hon. Gentleman nor his predecessor can ever remember a December when they could have gone to their constituents and talked about an unemployment rate of 1.5 per cent.——

Mr. Gwynoro Jones

The Secretary of State is talking nonsense.

Mr. Peter Thomas

If the hon. Member for Carmarthen is anxious about the effect of a three-day working week on those who are now in good employment, he should go to his miner friends and suggest to them that the remedy is in their hands.

Other parts of Carmarthenshire, too, have low unemployment figures. Carmarthen itself has a level of 1.3 per cent., and the December level in Llandeilo and Llandovery was 2.4 per cent. The hon. Member for Carmarthen appears not to like the facts. I can remember that a few years ago in the Welsh Grand Committee the hon. Gentleman was always on his feet pointing out the high unemployment rates. The Opposition seem bitterly disappointed when figures of this kind are made public.

Mr. Gwynoro Jones

I do not want to advise the Secretary of State, who represents one of the Hendon seats, about the affairs of Wales. He should go to Wales and discover the facts for himself. Is he not aware that a year ago unemployment in Wales reached 60,000, a figure never experienced in Wales since the war? To talk of reductions now is easy. The figure could not go any higher. It had to come down.

Mr. Peter Thomas

I am not saying that it has come down. I am giving the level at the moment. I know that the hon. Gentleman does not like it when figures like these are given, because he is only too happy in a political situation when the figures are bad. The hon. Gentleman should not think that I do not know Wales. I was a Member of Parliament for a Welsh seat for many more years than he has been a Member of Parliament for a Welsh seat. I was in this House 23 years ago representing a Welsh seat. I know Wales, and I know how pleased the people of Carmarthen are at the situation that obtained in December and how concerned they are that it is in jeopardy because of certain other matters.

My hon. Friend the Member for Pembroke (Mr. Nicholas Edwards), who made such a splendid speech which was appreciated by everyone, pointed to the problems of Pembrokeshire. Pembrokeshire still has its problems. Unemployment in that county shows a marked seasonal variation, reflecting the importance of the tourist industry. The completion of construction work on the Esso and Amoco refineries last year has added to the unemployment problem, but I agree with him that there are encouraging prospects. There are more people in employment now.

We all naturally hope that oil and gas will be found in commercial quantities in the waters of the Celtic Sea. The Government are co-operating with the largest operators in a programme of research into conditions in that area. There has always been a case for pressing on with this exploration work as quickly as possible. Our present energy difficulties give added point to this need. But we must ensure that a proper balance is struck between economic and environmental considerations.

I believe that if oil or gas is found it will be possible to do this, to the benefit of Pembrokeshire, Wales and the country as a whole. I entirely agree with the view that we must take account of the need for infrastructure improvements to cater for Celtic Sea developments, and I assure my hon. Friend that the Welsh Office will play its full part in this matter.

I hope that the House will forgive me if I do not——

Mr. Gwynoro Jones

What about agriculture?

Mr. Peter Thomas

The hon. Gentleman asks me to refer to agriculture, which clearly was of concern to many hon. Gentlemen. The agricultural industry in Mid- and South-West Wales obviously faces problems.

Mr. Gwynoro Jones

Major problems.

Mr. Peter Thomas

I cannot recall an occasion when agriculture did not have problems, but let us not forget the strength of the industry which faces those problems. It is no longer in a state of stagnation which characterised it when we took office three and a half years ago. Our aim at that time was to create the right conditions in which an efficient organisation could expand. That we have succeeded in doing that is demonstrated by the response of the industry. There has been an increase in net production throughout the country of 11 per cent. compared with an increase of only 5 per cent. during the preceding five years.

Wales has shared in this success story. True, there has been the impact of the recent high feed prices. I fully appreciate the concern expressed by farmers at the considerable increase in their costs, to which reference was made by my hon. Friend the Member for Pembroke and, indeed, by other hon. Members. The milk producers are considerably concerned. Because of this concern we agreed to start discussing the Annual Farm Price Review earlier than usual. The question of costs has figured largely in these discussions, which are well under way, and will be taken into account in the determination which follows the review.

Mr. Gwynoro Jones

I agree that the price review procedure has taken place two weeks earlier than usual, but may I ask whether the determination will be two weeks earlier than before?

Mr. Peter Thomas

I cannot give any undertaking about the determination of the price review. All I know is that farmers were pleased that this important matter that they wished to have discussed as soon as possible was accelerated.

The hon. Member for Brecon and Radnor and the hon. Member for Cardigan referred to the rate support grant. Arrangements for determining the level of rate support grant have been the subject of intensive discussions between the Government and the local authority associations. The problems of Wales are well understood by everyone who has been involved in these discussions. Hon. Members know of my concern over the impact on some areas of the various formulae that have been discussed with the local authority associations, and I assure the House that the Government are still considering the matter and that we shall publish a White Paper in due course.

The situation in Mid-Wales and South-West Wales is in many ways a hopeful one, despite the problems that we undoubtedly face today. It would be wrong to underestimate the effect upon these areas of the difficulties that we are experiencing, and no one wishes to do that, but it would be equally wrong not to acknowledge the substantial measure of success that has been achieved and the prospects for the future.

Conditions are being created throughout this wide area of the Principality which, despite the many problems, will enable vital thriving communities to adapt themselves to the demands of the future.