SCOTLAND (UNEMPLOYMENT) (Hansard, 18 March 1975)

§ Mr. James Sillars (South Ayrshire)

This debate is about one of the greatest problems we face in Scotland today—the massive unemployment rate, which shows over 100,000 Scots without work. It is a state of affairs which cannot go without protest or demands for action by a Labour Government.

As I develop the argument, I shall explain to my hon. Friend the Minister of State, Scottish Office my full recognition that the Labour Government do not want unemployment, how they inherited an economic situation which left little room for orthodox manoeuvre and how the world situation militates against swift, easy solutions. It will not be part of my argument to suggest that there is a magic wand which can wave over the Scottish economy, linked so intimately as it is to the British economy, and cure the unemployment problem.

The problems which the Government face are unprecedented in the post-war period. There are severe inflation, heavy unemployment, a huge balance of payments deficit, exceptionally heavy foreign borrowing, a legacy of under-investment in industry, a world economy in recession, if not in actual slump, and the albatross of the Common Market round our neck.

On top of those problems is the added phenomenon that the world is undergoing a fundamental change in the balance of wealth and political power, arising out of the OPEC countries' actions and the Third World's efforts to find its political footing in the world community. The world is in a state of political and economic metamorphosis. No one can tell the final shape of things to come, but we all know that the old-established order of a United States-led Western hegemony is over.

All the factors that I have mentioned so far mean that instability and uncertainty are the order of the day. That means that a premium is placed on international agreement and international action on economic and financial affairs. That being the position, there are obvious constraints upon the ability of 1607 our Government to act against unemployment with the traditional demand-management boost to the economy.

No doubt it is this set of unusual circumstances which lies behind the explanation from my right hon. Friend the Secretary of State for Scotland that 100,000 unemployed under him arises out of a different situation from that which prevailed when we last experienced this level of unemployment under a Tory Government with a Tory Secretary of State for Scotland. My right hon. Friend is correct. No doubt that is why the Tory campaign against him fizzled out after only a few days and after a few boyish Questions from the lad who is now the Shadow Secretary of State.

Of course, it is not good enough to take refuge in the disturbing aspects of economic and political life in the world scene in 1975. No Socialist Government should be surprised that Western capitalism, after years of exploiting the rest of the world including the oil countries, is now having the account squared against it. Nor should a Socialist Government be surprised that Western capitalism manifests the inherent faults of the capitalist system. As a result of its profit motivation, ridiculous situations develop. For example, bricklayers are idle, bricks are stockpiled and people remain without homes.

Whatever critique we apply to capitalism, I am enough of a realist to know that we cannot opt out of the system with a quick side-step. When I was 17 I thought that we could do it in at least 24 hours. I have learned a wee bit since then. I know that we are locked inside the system for the foreseeable future. That is a view that is shared by many people in the Labour movement, including the TUC. The excellent economic review by the TUC suggests how we can improve the operation of the capitalist system to produce the basis for stability and growth in the long term.

That does not mean that a Labour Government, elected on the most Socialist-inclined manifesto since 1945, should accept that nothing can be done in the face of the problems we face. There is an urgent need for the Government to do something about unemployment, despite the real constraints imposed 1608 by the debilitated British capitalist economy caught in the worst world crisis since before the last war.

After all, our manifesto, even with its Socialist character, did not promise to extricate us from the sphere of Western economic influence. What was implied was that despite problems created by capitalism—indeed, because of them—a Labour Government would be best able to tackle the fundamental problems that the system poses for working people and their families. That certainly included action on unemployment. I quote from the Labour Party election manifesto for Scotland. In page 8, in the final paragraph dealing with the section headed "Jobs", it states: Labour will do whatever is necessary to bring full employment to Scotland. We shall not rest until everyone in Scotland has the opportunity of a decent, well paid job. I pay tribute to the Government's chosen methods of tackling the fundamentals of our economic problems. The Industry Bill, the National Enterprise Board, the British National Oil Corporation, the planning agreements system, the creation of the Scottish Development Agency—I see that my hon. Friend the Member for West Lothian (Mr. Dalyell) is present—and the setting up of a Scottish Assembly with economic teeth represent a comprehensive strategy of recovery and future expansion. But these are middle or long-term policies. I am arguing that we also need short-term policies. Even in the face of the problems involved in managing the United Kingdom economy, there is something in the short term that the Government can do to create jobs and to put people in work.

Although this Adjournment debate is under the heading of Scottish unemployment, let me say emphatically for the benefit of some Opposition Members that the same problems exist in other parts of the United Kingdom. I hope that the Government will take early action there as well as in Scotland. Today the Scottish unemployment figure stands at 4.7 per cent. In the North of England it is 5.2 per cent. This illustrates that this is not just a Scottish problem.

I advance three main reasons for demanding Government action. The first concerns the human factor. Unemployment is destructive of self-respect in the 1609 individual. It erodes the personality of those who are on the dole for any length of time. Second, if for too long we tolerate unemployment at the 100,000 level it will become the accepted norm. People will become conditioned to believing that such a level is the best that can be achieved.

Governments will boast, when the figure dips below that magic level, that they have actually done something. They will pat themselves on the back and pretend to the people that they have worked wonders. This is not a flight of fancy on my part. With each successive crisis in the Scottish economy we have seen unemployment rise. When mini-booms took place, the figures never went back to their previous base level. Over the years we have seen the Scottish unemployment rate reach a higher and higher base point. Over the years what was unacceptable in one period became the new base point criterion in another. This is what we must combat with all our political strength and ingenuity. We must take decisive action to push the base rate down so that the words "full employment" start to have a real meaning in the corporate life of Scottish society.

The third reason why I ask for Government action is that we are faced with the lunacy of the capitalist market system, with labour which could be productive and useful being paid, through unemployment and other benefits, to be unproductive and useless. [Interruption.] I do not expect the hon. Member for Glasgow, Cathcart (Mr. Taylor) to follow the logic of that. He is one of the chief exponents of the craziest system ever known to mankind.

No one can defend such a system when people sit pat and there is important work to be done for the community lying undone. Whatever difficulties the market economy poses at present, and even though we could not guarantee the fullest of full employment, we should be able to take action that would make a serious contribution to reducing unemployment, especially among the semiskilled and unskilled people who suffer most from unemployment. It is they who become the hard core of the long-term unemployed.

Each increase in the productive potential of the economy during a period 1610 of low growth means that it is more difficult for the semi-skilled and the unskilled to get work. It is estimated that the productive potential at present in the economy is around 3½ per cent. If we get real growth in the economy of only about 2½ per cent., that will mean that unemployment problems for the semiskilled and unskilled will increase and not decrease.

Also of great concern is the large number of youngsters leaving school in 1975 —80.000 of them. About 64,000 will come on to a depressed labour market. We must be anxious about the social implications of young people, the most physically active and robust section of the community, having no work. Those who will find the greatest difficulty in gaining employment are those who would normally fit into the semi-skilled and unskilled categories. Every family in the country with a young person leaving school this year must be more than ever anxious about the number of O-levels the youngsters will get. Those leavers who for one reason or another will get very few or none at all will find that they face a grim future at a time when there are 100,000 unemployed in Scotland.

The call is for the Government to "do something". This cry is often made from within and without this House. But few ever suggest to the Government what "do something" means in practice. I suggest that we could get action by using the Manpower Services Commission as the main policy instrument, and therefore we would not need further legislation.

That idea is not new and it is not mine. The current TUC Economic Review explains in paragraph 117 on page 42 that the problem of unemployment affects those under 24 and over 55 with the greatest severity. In the next paragraph it says: The establishment of the Manpower Services Commission provides an opportunity for the public authorities to act much more effectively in this field. It goes on to say: The MSC itself, after its first year of operations, has unanimously agreed that it should have an authoritative role in the formulation and provision of a comprehensive manpower policy and discussions to this end are taking place with the Government. Moreover, at its first meeting, in January 1974, the Commission considered that it needed to prepare plans 1611 which could be put into effect if the employment situation deteriorated in 1974 and 1975, and in consequence contingency plans have been prepared in the fields of training and job creation. In paragraph 120, the TUC says: The MSC has examined a proposal by the TUC and others that a job creation scheme could help reduce unemployment. It could be directed at the hardest hit groups in the labour force and the most severely depressed regions. It goes on to explain that the jobs would be labour-intensive and community-oriented.

The estimate is that £20 million would help to create 15,000 jobs. When we consider that unemployment benefit for 15,000 people costs up to £13½ million a year and that there is also a loss to the Exchequer because unemployed people do not pay income tax or for insurance stamps, we can see that for a little net extra expenditure the Government could make a significant contribution to the reduction of unemployment, not so much by demand management policies as by resource management policies, by putting the unemployed men and virtually the same amount of money together but for different reasons than to keep people on the dole. We should make much better use of our human and financial resources if we gave people back their self-pride.

This need for a rational use of resources is hammered home in the TUC Economic Review. It estimates that it would cost £900 million in unemployment and social security benefits if there were 1 million unemployed. Another estimate is that if unemployment rose to1¼ million the Government would need to borrow another £800 million to £850 million to meet the payments. How stupid it is, in a country crying out for things to be done and people anxious to work, to make people idle and then pay them for remaining idle.

Scotland is seriously affected by heavy unemployment yet there is so much in our communities that needs attention. I suggest to the Government, therefore, that they should use the MSC to set up a direct labour employment agency, perhaps called the Scottish Community Project Agency, into which unemployed people could go, drawing union rates of 1612 pay and with proper union coverage of health and safety and conditions.

The agency should be given the task of undertaking community projects at the direction of the Secretary of State for Scotland or at the request of the local authorities. It could have planning and management teams, a building section and a general work section and it would operate under a directive to undertake specific community projects within the local authority areas. This would provide work for a number of skilled men in management planning and the other trades. The bulk of the jobs created would go to the semi-skilled and unskilled and no doubt a number of school leavers could also be employed. This would assure young people of a useful occupation and allow them to make a valuable contribution to their own lives and to society.

I said that there is much that needs to be done in Scotland. Let me give a list of headings. There is the rehabilitation of National Coal Board houses. I have a fair number of these houses in my constituency of South Ayrshire. They represent a grave problem to the people living in them. They are very old houses which require urgent modernisation and bringing up to date to meet current living standards. That is not being done. In my opinion, it would be done and it should be done.

Then there is the urgent need to insulate and centrally heat thousands of council and SSHA houses, many of which in the winter have bedrooms so cold that it is like sleeping in an ice-box. I assure the House that I exaggerate in no way. During the severest parts of the winter in Scotland, for most of the day at least two-thirds of the average council house is uninhabitable because of the cold. Anyone who has lived in the council situation knows that to be the truth. That is an area of work which needs to be done and which could be done. Then there is the modernisation of council houses, especially in relation to electrical re-wiring.

Next there is the need to clear away remaining pit bings and slag heaps, legacies from our old industrial past. Then we have cities, towns and villages with open spaces which are eyesores and derelict buildings which give an area a depressing environment.

1613 I appreciate that much of the environmental aspect of these headings will be covered by the Scottish Development Agency, but it will be some two or even three years before the SDA can effectively discharge that part of its task. That comment is drawn from a reading of the consultative document outlining the ô of the SDA. We need action before the SDA comes to engage in its environmental clearing-up task.

I do not exaggerate in any way what I regard as the greatest social crime in our society—that is, making and keeping people unemployed. It has never been my personal experience to be unemployed, but I came very near it at one time in my working life. It was the most demoralising experience of my whole life. I do not want to see any individual in Scottish society or in British society put through that hoop for any longer than is absolutely necessary.

Unemployment is a social outrage. It is a crime against the working people in a capitalist society. It is what my right hon. Friend the Prime Minister some years ago described as "the greatest pollution of all"—that is, pollution of the soul of the individual.

I know that there is no need to convince a Labour Government of that essential truth. I hope that the Government will at least consider acting in the way suggested. If they do, or if they act in a similar way, it will be a meaningful demonstration to the Scottish people of Socialist concern leading to decisive action on behalf of the working people whom we were elected to govern and to represent.