NORTH-EAST WALES (Hansard, 21 November 1974)

HC Deb 21 November 1974 vol 881 cc1660-9 1660

§ 10.1 p.m.

§ Sir Anthony Meyer (Flint, West)
I wish to draw the attention of the House to the employment situation in North-East Wales. At the moment, the situation may not look too bad if the number of registered unemployed is taken as the yardstick, but that is a most unsatisfactory measure. Our problem in North-East Wales has for a long time been a low level of economic activity. Even by the yardstick of unemployment, things are already beginning to look pretty bad at the western end of the area. The number of people out of work in the Rhyl employment exchange area always rises at this time of the year because of seasonal factors in the hotel and holiday industry, but already this year it is almost double last year's level.
Of course we are talking about fairly small numbers, and it would be possible to effect a rapid improvement. An advance factory is being built to provide 40 badly-needed male jobs, but the construction is many months behind schedule, and what is much more worrying is that there has not been one inquiry from a prospective employer. On the other hand, although the outlook for jobs in the Rhyl area is bleak, I see no grounds for real alarm.
The situation in the east of the old county of Flintshire is different and much more worrying. The numbers out of work still look reassuringly low, but these below-average figures conceal an unhealthy dependence on only three major employers—British Steel at Shotton, Hawker Siddeley at Broughton and Courtaulds at Greenfield and Flint. If any one of the three were to run into trouble, the effects on the whole area would be serious. If two of the three ran into trouble at the same time, the situation would be alarming indeed. At this moment, we have not two but all three in serous difficulty.
When I speak of difficulties I do not mean simply the general rundown and loss of confidence which is afflicting British industry as a whole. I mean specific and immediate troubles. The Shotton steelworks is, of course, far and away the biggest employer. The outlook there is clouded with uncertainty as to 1661 whether British Steel is to go ahead with its plans to phase out steel-making as part of its massive plans for restructuring the whole industry. Some 6,000 or more jobs are at stake.
I do not want to say too much about this because, although this is the area where the largest number of jobs is affected, it is also one in which the Government can act, and may act, to save the jobs. There are high hopes that they will do so. I hope that the Minister will not repeat, incidentally, the charge that I voted for the rundown of steel-making at Shotton. It would be just as true to say that the Secretary of State for Wales voted against the provision of more jobs at Port Talbot. What I am sure of, however, is that the Government are well aware of the problem of Shotton and that they will do what they can to help.
Now Hawker Siddeley is in trouble, hit by the recession in the air travel business and having to cancel some projects such as the HS146 and to cut down on others such as the A300B airbus. To compound the company's problems, there are all the uncertainties brought about by the possibility of nationalisation. There may be those at Hawker Siddeley who hope that nationalisation would ensure the continuance of the HS146 and would welcome it on that account. But others must reflect that Hawker Siddeley has prospered and paid good wages because it has backed its judgment when the Government have hung back or often backed out. These more thoughtful people must wonder whether nationalisation would bring such benefits to Hawker Siddeley in the long run.
Courtaulds, at any rate in the short term, is in the worst trouble of the three. There are shortages of raw materials, falling orders, a general slump in the textile industry and a nasty outbreak of industrial disputes in which neither management nor unions have displayed much skill in mending matters. Hundreds are on short time and there is widespread fear of redundancy on a large scale and even of a complete shutdown.
There is, therefore, trouble for all three major employers. One more small employer but a good one, Mostyn Dock, is threatened by the Government's proposals for the nationalisation of the ports—mercifully absent from this year's 1662 Gracious Speech, but which, if it comes, means that Mostyn will be assimilated into Liverpool and therefore will be liable to suffer the same fate as Liverpool docks.
In the countryside, too, there is a massive loss of confidence which the announcement of the Minister of Agriculture today, although it will help, will not dispel. That means that the countryside can no longer be looked on as a limited but steady source of employment.
Now there is a new adverse factor affecting areas such as the North Wales hinterland. The huge rise in petrol prices will aggravate the problem of low economic activity. Wages there are low and people who have to travel to work by car because of inadequate bus services will find by the time that they have paid their travel costs that they are not much better off than if they stay at home on supplementary benefit. This is a most undesirable state of affairs from a social and economic point of view. The time may well be coming when the Chancellor of the Exchequer will have to think in terms of allowing travel-to-work costs to be set against tax liability even if the consequence is that the cost of petrol for purely pleasure motoring must increase even more.
Those are our problems. What can the Government do to help? They must begin by recognising how precarious is the situation. Because everything is liable to go wrong at once, our present apparently tolerable situation could deteriorate so rapidly as to become well nigh irreversible. Therefore, even if the Government say—and no one can blame them for saying it—that their capacity to help is limited by the very tight economic situation, whatever they can do must be done quickly. Perhaps it will be too little but let it not be too late.
I have no doubt about the prime requirement of North-East Wales and indeed of all North Wales, and that is better communications, which means, above all, roads. Our so-called main roads are appalling. The A5 is in just about the same condition as Telford left it. The A55 is about as wide as a service road to a shopping centre. Successive Governments of both parties have done nothing for a decade. I know that roads cannot be built overnight, but cannot we 1663 have an indication that these roads will get high priority?
It is not just a question of money, men and material because money, men and material are being used to spruce up minor roads, which are the responsibility of the county council. I know this because the minor road which leads to my cottage is having thousands and thousands of pounds spent on it to even it out and widen it.
The A55 remains totally untouched. Nothing is done. There are not even firm promises. A clear commitment now from the Government on a timetable for the complete dual-tracking of the A55 could have a big effect on a potential employer thinking in terms of setting up in North-East Wales.
It is not just a matter of the roads in Wales. There are also equally appalling roads on the English side of the border. To get to the awful A55 in Wales, one has to travel from the M6 along equally appalling roads to Chester or through Shrewsbury. It sometimes seems as though the road planners are equipped with a map of Britain from which Wales is rubbed out, so that when they look to see where to put the roads they say to one another "It is no good taking that dual carriageway any further west than the M6 because it leads only to cliffs and there are not even any ports there." I sometimes wonder whether the Secretary of State for Wales and the Secretary of State for the Environment ever meet. Their roads never do. I only hope that the Channel Tunnel, if it is ever built, is not built on the same principle.
Even if the Government were here and now to announce a big programme of road improvements for 1975, we still need more immediate help. The only immediate help in the Government's gift is full development area status, which all the neighbouring regions enjoy and which North-East Wales alone does not enjoy. It is not just that we are without it. It is that all our neighbours have it and, therefore, any manufacturer thinking of setting up in that part of the world will be convinced by the much bigger attractions in terms of investment and, above all, regional employment premium offered by Merseyside or North-West Wales. To some extent the regional employment premium is a two-edged weapon. I am 1664 not happy about its long-term effects. It tends to perpetuate low-wage industries, but it is undeniably an effective short term aid and I hope that the Government will be prepared to use it.
I cannot expect the Minister tonight to calm our anxieties, but I hope that at least he and his colleagues will not try to justify complacency on the ground of statistics, which at the moment are highly misleading. Our situation is very precarious, and if action is to be taken it must be taken in good time.

§ Mr. Geraint Morgan (Denbigh)
rose—

§ Mr. Deputy Speaker (Mr George Thomas)
Order. Has the hon. and learned Member for Denbigh (Mr. Morgan) reached agreement with the hon. Member for Flint, West (Sir A. Meyer)?

§ Mr. Morgan
Yes, Mr. Deputy Speaker.

§ Mr. Deputy Speaker
I trust that the Minister has no objection.

§ The Minister of State, Department of Employment (Mr. Albert Booth)
I have no objection.

§ 10.13 p.m.

§ Mr. Geraint Morgan (Denbigh)
I am most grateful to my hon. Friend the Member for Flint, West (Sir A. Meyer) for allowing me to intervene briefly in the Adjournment debate. I fully endorse everything he has said about the situation in North-East Wales, particularly with regard to the roads. If anything, my constituency suffers even more than his from the deplorable state of the A5 and A55.
The purpose of my intervention is to draw to the attention of the Minister something about which I have had a considerable amount of correspondence with the Welsh Office, and that is the state of affairs at Llanrwst. The town, in my constituency, has for a long time had an unenviably high rate of unemployment, much of which is unfortunately due to the fact that premises which could house firms, which could in turn bring employment to the town, have been sterilised because the Secretary of State for Wales and his predecessor have grimly adhered to the line of a bypass laid down before the last war—a bypass which everyone knows is unlikely to be built. I have 1665 drawn attention to this in correspondence, and I ask the Minister to give immediate attention to the problem, which is of great importance to that town.

§ 10.15 p.m.

§ The Minister of State, Department of Employment (Mr. Albert Booth)
The opportunity to debate the employment situation and prospects in North-East Wales is most welcome. The presence of my hon. Friend the Under-Secretary of State for Wales beside me signifies the interest of his office and his own deep personal interest as constituency member for Flint, East. Within North-East Wales there are several areas with different employment characteristics. Therefore, the most constructive way I can approach the subject is by considering the different employment situations in a number of those areas.
Although I agree that communications are a vital matter, I do not agree with the strictures put forward by the hon. Member for Flint, West (Sir A. Meyer) in respect of my right hon. Friend the Minister for Transport. I understand that there are two miles of dual carriageway from Queensferry to the English border which have just been announced.

§ Sir A. Meyer
The point I was making was as follows: although there are two miles of dual carriageway to the English border, is any corresponding action being taken on the English side of the border? As far as I am aware, nothing is being done in that respect.

§ Mr. Booth
This evening I am discussing North-East Wales and not the English side of the border.
Perhaps I may start with the subject of Shotton, which is an area of great employment concern. We appreciate that 5,500 jobs in the British Steel Corporation in iron and steelmaking and hot rolling are at stake there at present. The proposal to close the Shotton works was suspended by the Labour Government earlier this year. That action was taken after the February election and we believe that in employment terms it was well justified.
It is important that any closure of this nature and the decision whether it is to take place should be subject to the most thorough review. I understand that my 1666 noble Friend the Minister of State at the Department of Industry will soon announce the result of this review. Although we hope that work at Shotton in steel making and hot rolling will continue, we in my Department have felt it right to make contingency plans along with the Manpower Services Commission against the possibility that the decision at the end of the review will be one for closure.
The plans which have been made aim at bringing aid to any worker who is made redundant. The Employment Services Agency has been in discussion with the British Steel Corporation to ensure that, should it be necessary, there should be provision immediately available for registration and placing facilities. The Training Services Agency has arranged, if necessary, to offer training opportunities in the area.
Another major matter relates to the Hawker Siddeley establishment at Broughton, which was mentioned by the hon. Member for Flint, West. At the Broughton factory, work is being done on the HS146. The hon. Gentleman said that Hawker Siddeley had backed its judgment. I should like to add that the Government with public money have backed their judgment in terms of Hawker Siddeley because the HS146 is a joint company and Government project. This does not appear to, have stopped Hawker Siddeley from wishing to make a unilateral decision to cancel the project.
However, the Government are carefully examining the firm's case for cancellation, although on first examination its case is not very convincing. No doubt my right hon. Friend the Secretary of State for Industry in considering the proposition will have some concern for the question whether the industry which he is required by our party manifesto to nationalise will have within it capacity for modern civil airframes. Fortunately, few workers engaged on the HS146 at Broughton would lose their jobs if the project were cancelled. This is in no small part due to the success of the HS125 executive jet.
Another worrying feature of the employment situation at Shotton relates to short-time working at Courtaulds. Clearly, more orders are needed. I hope that some of the measures announced in the Budget last week will help.
1667 We have heard again tonight a plea for development area status. I take it that this relates to the Shotton area. We could not justify development area status for the Shotton area on the present unemployment figures. In October 1974, unemployment in the Shotton travel-to-work area was 3.3 per cent., which is below the average for Wales.
However, I take the point that the statistics are not necessarily the sole criterion for development area status, and I welcome the assurance that I have from my right hon. Friend the Secretary of State for Industry that he will be prepared immediately to reconsider this question whether Shotton should have development area status if there is any change in the position. The hon. Gentleman may take it that the closure or continuation of a steel works would be one factor determining whether for this purpose there was any change in that position.
Another area in North-East Wales which has its own employment characteristics is the Wrexham travel-to-work area. This area was granted development area status by a Labour Government in 1966. In the past six months there has been an increase in unemployment in the area from 2,118 to 2,391. As one might expect, this has been accompanied by a fall in the number of unfilled vacancies.
My advice from officers in the area is that firms there are suspending recruitment, that employment of women in the area is very heavily dependent upon the electronics industry and that one major electronics firm in the area has already abandoned its night shift and declared redundancies. The reason is a loss of orders. Here again, we hope that the measures announced last week by my right hon. Friend the Chancellor of the Exchequer will be of help in this connection.
In the Wrexham travel-to-work area, 12 months ago there was a closure of considerable significance—that of the Gresford colliery. In this case, 953 men lost their jobs. Redeployment of these men has not been easy. Many of them are over 50 years of age, and 320 are still unemployed. However, most of these ex-miners who have taken on new 1668 jobs have become factory production workers. It is most encouraging to hear employers in that area speak very highly of the calibre and adaptability of those ex-miners who have come to work in factory production. There are still vacancies in the area for this kind of work, and I am glad that Wrexham Employment Office has full job centre facilities and therefore is better equipped than many other areas to deal with problems of redeployment.
Since the hon. Gentleman has done so, I wish to say a few words about Rhyl. Although, strictly speaking, it is not in my Department's North-East Wales subdivision, Rhyl is in an intermediate area, employment there tends to be seasonal, and unemployment figures include a number of older people who have moved to the area in preparation for retirement. Nevertheless, there is an underlying male unemployment problem with a shortage of new jobs in Rhyl. There are an estimated 240 jobs in the pipeline, 170 of these being for men.
In recognition of this situation, the Department of Industry has just built a 10,000 square foot advance factory at Rhyl. It was completed this month, and the Department has drawn it to the attention of suitable industrialists. I hope that the presence of the advance factory will enable the Department to persuade a number of other people to come to look at the area who may set up employment there in premises other than the advance factory.
I turn now to the prospects for North-East Wales as we see them. It is the Government's policy to interest new firms in this area. Some of those whom we have sought to encourage have been reluctant to locate at Shotton for the simple reason that there is no evidence of a sufficient number of men seeking work in the area. If steel making at Shotton were terminated, the position would dramatically change and more new industry could be aided by the Government to come to that area and be expected to do so. The Department of Industry has had some considerable successes in other areas where closures have taken place and has achieved, by the generous use of selective aid, the creation of a number of new jobs to offset the effects of closure and to aid redeployment.
1669 In Wrexham the industrial estate will be substantially expanded. The acquisition of land for this purpose is well advanced and a 30,000 square foot advance factory was authorised in September this year. Mid-November figures published today show a small fall in the total number of unemployed in Wales and a larger fall in the seasonally adjusted number.
In the struggle to overcome our economic problem, our greatest asset is the working skill and capacity of our people. In the context of this debate, our policies in tackling economic problems can therefore be judged in North-East Wales by the extent to which they assist and enable people effectively to apply that skill and capacity.