WELSH AFFAIRS

HC Deb 12 November 1975 vol 899 cc1554-610

Motion made, and Question proposed, That this House do now adjourn—[Mr. Coleman.]

Mr. Deputy Speaker (Mr. George Thomas)

As hon. Members will know, this is likely to be a curtailed debate. That should be borne in mind.

4.30 p.m.

Sir Raymond Gower (Barry)

I am grateful to the Leader of the House and to the Government for having made possible this extension of a debate which commenced at a rather late hour some weeks ago. I express to the representatives of the Government who are on the Treasury Bench today my thanks for their having done this. Nevertheless, it is very undesirable that a debate on Welsh affairs or on any other subject should be broken into two parts, separated by such a long period of time. It reflects again on the unfortunate arrangements which were made this year for this debate. A number of speakers have commented on it.

I sincerely hope that in the future there will be no repetition of what appears to be a relegating of the debate on Welsh affairs to the least convenient time at the last possible moment in a parliamentary Session. It is significant that we should be engaged on this debate at the very end of the Session.

In opening the debate the Secretary of State for Wales said: These are difficult times for all of us. He added, rather plaintively, I thought: There is so much to be done, and the resources are so limited".—[Official Report, 23rd October, 1975; Vol. 898, c. 841.] Everyone must agree with him and sympathise with him to some extent in his predicament.

At this moment, economic prospects for Wales—as, indeed, for the United Kingdom as a whole—are sombre, to put it in the most restrained terms. In the space of about 20 months, or about 550 days, we have travelled a very long way from the position which obtained when the Government took office in February 1974.

As my hon. Friend the Member for Pembroke (Mr. Edwards) stated in his speech, industrial production is significantly lower than then; manufacturing is at a decisively lower level than it was then the Government took office; inflation is very much worse; and unemployment is higher than in the lifetime of anyone less than 35 years of age. That is certainly the case in the Principality.

I repeat to the Minister that it is a matter for some deep concern that unemployment in Wales is higher today—except for one or two limited spells due to extraordinary conditions—than at any time in the lifetime of anyone here who is less than 35 years of age.

I regret that the right hon. Member for Anglesey (Mr. Hughes) is not here at present, because I recall that he made some comments about these matters. I do not wish to be highly critical of him but he complained of the remarks of my hon. Friend the Member for Pembroke in mentioning the high unemployment. The right hon. Member for Anglesey said that unemployment is high in almost every country in the industrial world, and he said that it was largely due to world conditions and to world prices. I wish that he and his colleagues, including those of them who are here today, had taken that view when the Conservative Government were in office just before February, 1974. But they did not. They assailed the then Conservative Government, accusing us of responsibility for a level of unemployment which was far lower than that which our country must now endure. We heard little then about oil prices and about world commodity prices from any Labour Party spokesman.

There would most certainly have been howls of anger, rage and passion if a Conservative Government were in power today about the present level of unemployment in the Principality. I can imagine one Labour Member after another asking Question after Question about the position. The Opposition have not acted in that way. Of course, we are deeply concerned about this vital matter, but we have not assailed and arraigned the Government at all stages because we recognise that a good deal of the trouble is international and that some of it undoubtedly arises from world conditions. However, I suggest that a considerable part of the trouble arises from Government action in the past 550 days

Mr. Emlyn Hooson (Montgomery)

To be accurate, it is 551 days.

Sir R. Gower

I am obliged to the hon. and learned Gentleman. I had not worked it out exactly. The Government are responsible in part because of their undue reliance on the social contract, which is seen to have been a dismal failure in the battle against inflation. I say that without relish.

The Government must also bear responsibility for the way in which the economy was run between the two General Elections last year, when unchecked inflation created a spurious sense of comfort and well-being in the minds of many people, and when increases in salaries and wages were at quite unrealistically excessive levels and certain to stoke the fire of inflation.

The Government are also responsible for the policies which have damaged, if not destroyed, confidence in industry at all levels, especially among those people who supervise, control and arrange the affairs of the smaller firms and industries in Wales. I do not wish to exaggerate the position. However, I can honestly assert that, throughout the years that I have had the honour to serve in this House, I have never been quite so anxious about the economic and industrial future of the United Kingdom as a whole and of the Principality in particular.

Unemployment is now beginning to bite savagely in that part of Wales which some hon. Members have described as the prosperous coastal belt. My own constituency is part of that coastal belt. Our unemployment problems in the past have not been on the scale of those which have obtained in some of the industrial valleys such as North Monmouthshire and Rhondda, or in Pembrokeshire and North-West Wales. But in the circumstances that I have attempted to describe, this industrial difficulty and the accompanying unemployment are beginning to have a savage effect even in those parts of the Principality which hitherto have been comparatively fortunate.

It is affecting established industries. I emphasise this because the Secretary of State took credit for and expressed some hope about the new and advance fac- tories being set up in Wales. However, the degree of employment which they may provide is limited, and it is even more regrettable that some which have been built, including some of those for which the previous administration were criticised, are not yet allocated. Many of them exist only on paper. Others have been built but are still not occupied. But, even when they are built and allocated to new tenants, the degree of unemployment which they can provide is limited by their size, which in some instances is relatively small.

But we are now seeing a process where long-established major industries in the Principality are beginning to feel the effect of the present difficult conditions and are themselves being obliged to reduce their production. It is not that they want to do so, of course, but conditions are making them do so.

It is affecting the smaller concerns especially, and I remind the House that some 63 per cent. of all the industrial units in Wales are reckoned to employ fewer than 10 persons. It means that the Principality perhaps more than other parts of the United Kingdom is highly dependent on its provision of employment in relatively small industrial units, and it is these which have been hit most savagely by continued inflation, by heavy and, some would say, excessive taxation, and by new administrative burdens with which all hon. Members representing Welsh constituencies must be well acquainted.

We have had special debates on the position of the self-employed, and it may be, as was suggested in a recent debate, that there are some exaggerations. However, cases which have been brought to my notice reveal the extent of the burdens—the large amount of office work and the high cost of it all to the very smallest units. If we have many failures of these very small firms, the cumulative effect on employment in Wales could be very serious. I repeat that 63 per cent. of the industrial units in Wales employ fewer than 10 persons. They are very small units, and many of them necessarily are tender plants. They have not been long established. Some have been encouraged into Wales by the development area policies of successive Governments. Their growth owes a good deal to the initiative of those who started them, but they have not had sufficient time to put down deep roots, and they have not long-established financial resources.

We adopt policies which bear heavily on such firms at our peril. There is a good deal of evidence that the policies which have been followed in the past 18 months and even, to some extent, those pursued by the previous Government have placed some of these firms in an extremely difficult situation.

Mr. Cledwyn Hughes (Anglesey)

I might remind the hon. Gentleman that I, too, am a tender plant. I deeply resent his reference to me in my absence for a few minutes at the start of the debate. A number of his hon. Friends were also absent. I hope that he will withdraw the unnecessary remark that he made.

Sir R. Gower

The right hon. Gentleman misunderstands completely the nature of my reference to him. I was being apologetic for having to mention him in his absence.

Mr. Cledwyn Hughes

Nevertheless, it was uncharacteristic of the hon. Gentleman.

Sir R. Gower

The right hon. Gentleman misunderstands the position—[Interruption.] I hope that the right hon. Gentleman will listen to me. I am trying to explain what happened. [Interruption.] The right hon. Gentleman is continuing a monologue which I cannot hear. I sought to refer to a comment he made at the earlier stage of this debate, and I realised suddenly that he was not present. I was apologising for referring to him in his absence.

Sir Anthony Meyer (Flint, West)

Perhaps I can be of assistance. I was present at the time, and I heard my hon. Friend's reference to the right hon. Member for Anglesey (Mr. Hughes). I can assure the right hon. Gentleman that my hon. Friend was being most courteous and was in no way critical of him. It is possible that the right hon. Gentleman was misinformed by his hon. Friend the Member for Neath (Mr. Coleman) about what occurred.

Sir R. Gower

I am grateful to my hon. Friend. What is more, Mr. Deputy Speaker, I think that you can confirm that my reference to the right hon. Gentle- man was an apologetic one—[Interruption.] I was in no way—

Mr. Deputy Speaker

Order. I hope that we can leave this domestic matter now and return to the subject under discussion.

Sir R. Gower

I shall revert to my original point. The situation in Wales and especially in my constituency is dependent not merely on what we can do for the big units—the State-owned or large private industries—but on the help and encouragement we offer to reduce some of the excessive taxation and other burdens which bear heavily on some of the smaller units. We shall not increase the employing capacity of the Welsh industry solely by considering the big units. We must rely heavily on the smaller firms which comprise a formidable proportion of Welsh industry.

I hope that the measures that the Chancellor has announced on a number of occasions will be successful and that in the months ahead we shall see the situation improve. However, at present the position is sombre and for many people it is filled with foreboding. There needs to be a collective effort and I sincerely hope that it will be forthcoming.

There is a good deal of evidence to suggest that the employees of many Welsh industries who have perhaps suffered more from unemployment than people in other parts of the United Kingdom are aware of the position and have been cooperative is seeking to achieve agreements which will ensure the success of the industries in which they are employed. That is a gratifying sign which I have discovered in some of the industries in my own constituency. Perhaps it is a welcome and desirable relic of some of our past misfortunes. In general, some of the harsh labour disturbances and disputes which have discoloured and disfigured industry in other parts of the United Kingdom, have been absent in many parts of industrial Wales. I see that the Minister is nodding his head in agreement. I realise the bad position of Welsh industry, but all parties in Welsh industry are anxious to succeed.

I have been encouraged by conversations which I have had with industrialists, the Welsh CBI, trade unionists and officers of individual trade unions in my own constituency. There is obviously a great deal of good will and determination in all parts of Welsh industry to succeed. The Government can cultivate that good will if the lack of confidence can be restored. There is also some lack of hope. Some people believe that the months ahead may be worse than those which have passed. Others believe that they cannot go on much longer. Bank overdrafts and the cost of credit play a major part in industry's prospects.

However, I am not wholly pessimistic. I hope that the Government will refrain from any temptation to impose new penal taxation, because I do not believe that at present Welsh industry can bear any more taxation.

I turn to the provision of alternative employment, which is a particularly difficult matter. I should like to pay a tribute to the work done by the Department of Employment and our other agencies. However, their ability to place people in suitable employment is limited. At present the vacancies are simply not available. I hope that the retraining which is taking place in certain centres will make a valuable contribution in this area, but again it comprises only a small part of the whole problem.

We need a general upturn in the economy, but we cannot expect that for some time. However, we must be ready for it and to that extent any increase in retraining which can be arranged will be advantageous.

I should like to refer to a matter which I have raised on a number of occasions—namely, the position of the airport at Rhoose which is in my constituency. I deeply regret that the Government were unable to answer or respond to the appeal of the consortium of Glamorgan county councils to give some grant to the vast capital expenditure which the ratepayers have had to bear without any Government assistance.

Mr. Fred Evans (Caerphilly)

I have reminded the hon. Gentleman about this matter on a previous occasion. He must bear in mind that in the first instance his own county council, the Cardiff City Council, refused to support Rhoose Airport. Therefore it is rather late in the day to shed tears now.

Sir R. Gower

Cardiff City Council has always been only a marginal part of my constituency. My constituency has generally embraced the Glamorgan area rather than the Cardiff area. I accept that successive local authorities and Governments have been at fault concerning this matter. I also accept that on a number of occasions the development of civil aviation in Wales has been despite the activities of Governments and not because of their activities.

Last week I asked the Secretary of State for Trade some Questions. In his reply he quoted some figures which are indicative of how Wales has received no financial help concerning aviation. On 3rd November I was told by the Undersecretary of State for Trade that in England help had been given to all the municipal airports at Birmingham, Carlisle, Manchester, Newcastle and Teesside. The help extended to many millions of pounds and in the case of Manchester alone to £3 million. In Scotland the Glasgow airport had received £3½ million in the period since the last war. The Edinburgh airport had received £8 million. Aberdeen airport had received a grant, as had the airports at Inverness and other parts of the North of Scotland. However, Wales has received nothing. No Government have given a grant for any airport in the Principality since 1945, but large sums of money have been allocated to England, Scotland and, indeed, Northern Ireland. That information reveals that Wales has a special claim.

I am not blaming this Government for the attitudes of all Governments which have preceded them. This Government are only one of several which are guilty in this respect. By refusing to give a grant this Government have joined the list of guilty Governments which preceded them. As so much money has been spent in assisting the development of airports in other parts of the United Kingdom it is surely reasonable that something, however limited, should be spent from public funds on airport development in Wales.

The former Cambrian Airways also was developed without Government help by the initiative of local private business men who set up a Welsh company to offer air services from the Cardiff area. We are concerned that it has been gradually taken over by British Airways—formerly by BEA. We are worried, because although it is not a vast part of British Airways and may well be regarded by British Airways as a relatively small part of its operation—something on the periphery—that is not how we regard it. It is the only considerable civil aviation activity that we have in the Principality. If British Airways regards it as a peripheral matter and one which is likely to be dispensed with, it will bode poorly for the future of civil aviation in Wales.

There is anxiety. This matter is important to my constituents, because 800 to 1,000 jobs are at stake at Rhoose Airport. People at all levels, including the trade unions concerned, are anxious about the matter. They are also concerned about the announcement that some of the administration of British Airways may be altered, because it will mean less employment at Rhoose.

I sincerely hope that the Government will do all in their power, first, to reconsider a grant to the Joint Committee of Councils which administers the airport at Rhoose and, secondly, to influence British Airways not only in keeping some service at Rhoose, but in not taking any steps which will substantially or significantly reduce employment at the airport.

I do not expect a reply to my next point today, but I hope that the Welsh Office will take note of it. There is great concern that when particular services have been sought by local industries—for example, services from Rhoose to Glasgow or to Brussels—the timetables and timing have been absurd and inadequate. Therefore, these services have not been supported as they should have been. There seems to be some substance in the statements which have been made to me about this matter. However, I must be fair. It is denied by those in British Airways to whom I have spoken and written.

Nevertheless, I hope that the Minister will consider this matter and do all in his power to help. We want a number of viable, scheduled services. We do not expect British Airways to run these services at a totally uneconomic level. However, when the services were run by Cambrian Airways Limited—an independent company—they increased yearly. Perhaps for economic reasons British Airways may have been unlucky in the last year or two. Certainly there was no increase in services last year. I believe that there has been a modest increase this year in movements in and out of the airport. We hope that the Government and British Airways are aware of the importance of this matter to Wales. We do not expect them to regard it as all-important in the context of the United Kingdom, but it is important to us.

Aviation is a growth industry. We have far too little of it in the Principality. It would be a tragedy if the great efforts of many people should now be thwarted or that the industry should die an unnecessary death at this stage.

I hope that when we next have an opportunity of debating these matters in general there will have been a better year than last year. Last year was a savage experience for this country. I hope that we shall not see another year like it.

Several Hon. Members rose

—

Mr. Deputy Speaker

Order. Before calling any other hon. Member to speak, I should point out that if each following speaker takes 28 minutes there will be some very disappointed Members in this Chamber.

5.3 p.m.

Mr. Ifor Davies (Gower)

The hon. Member for Barry (Sir R. Gower) has raised the important issue of civil aviation, and in particular Rhoose Airport. I was a member of the Glamorgan County Council in the early days when it courageously took over responsibility for the airport. In the light of the delegations which we have met in recent days, I shall be glad to follow the hon. Gentleman on that subject later in my speech, because I sympathise with his argument.

The hon. Member for Barry in his opening remarks analysed the economy. That was in keeping with the remarks made by the Secretary of State for Wales who, in opening the debate, stated that the background to the debate was the state of the economy and the problems of its management.

It is equally important to emphasise today that the way these problems are dealt with will determine the degree of success that we achieve in coping with the primary task of overcoming inflation. Therefore, our first priority must be a planned economy. But, as always, there are bound to be many different reactions to planning.

I believe that positive and constructive planning is an absolute requirement if we are to steer the economic ship of State through the sea of icebergs—ice-bergs in the form of the new, menacing, economic and inflationary problems referred to by the hon. Member for Barry. As I understand it, that was the timely message which came from the Chequers meeting with its new sense of urgency and unanimous call for a new industrial structure and investment.

The central issue is whether and in what way the productivity of British industry can be raised. This afternoon I wish to address myself particularly to the situation as it affects the Principality.

The level of employment in Welsh industry can be improved only by the introduction of new techniques and higher productivity. That implies the stimulation of investment, and that has been one of our great weaknesses in Wales.

At this very moment we are confronted with the great dilemma facing our greatest basic industry—the steel industry—which is the lifeblood of all our industrial activities.

The House will be aware that the British Steel Corporation, after a detailed and protracted study, produced its investment strategy, which accepted that, on economic, technological and sociological grounds, Port Talbot was the right place to expand to keep Britain competitive in the steel and tinplate markets of the world. The whole steel industry is still anxiously awaiting the Government's decision on that matter. We had evidence of that only yesterday when a delegation from Wales met some of my hon. Friends and myself. It was the widest representation I have ever seen in the House, being composed of local authorities, counties and districts, factories, trade unions and people vitally concerned with the industry.

I fully understand the Government's difficulties regarding this matter. But time is not on our side. Indecision and delay in revitalising the British steel industry has already given our overseas compete- tors a huge lead in the international race. Last year Britain fell to eighth place in the international steel producers' league, and for the first time we were overtaken by France, Italy and China.

Most of the big steel-producing nations are forging ahead with expansion projects in which production is concentrated on large coastal plants using the most efficient processes.

In the hard world of steel economics, there is no sentiment. I saw this for myself recently when I visited Japan with a parliamentary delegation. A steelworks not far from Tokyo, with a similar work force to that at Port Talbot, produces three times the amount of steel, not because the workers are better or more skilled, but simply because they have been given the tools to get on with the job.

Mr. Donald Anderson (Swansea, East)

Would my hon. Friend confirm that the trade unions at Port Talbot have given firm pledges to reduce manning levels to get at least some way towards the current levels in Japan?

Mr. Davies

Yes, I confirm that. It is an important development.

I urge the Government, in the light of this situation, to give Port Talbot the tools to get on with the job by implementing the BSC's strategy. I am confident that management and workers will accept the challenge and will match up to any foreign competition.

This is an issue which affects not only Port Talbot. It affects the whole of South Wales industry, which in one form or another is interdependent on steel. In addition to coal, our tinplate industry above all is vitally affected. I say "our" tinplate industry deliberately, because West Wales has been the home of the tinplate industry for more than 200 years. The Velindre plant in my constituency and Trostre in West Wales stand as proud reminders of our great tinplate tradition.

The danger signals have gone up. Every day tinplate users are demanding better quality and closer tolerances, and the industry must meet these demands or lose the trade. The hot-rolled coil for the tinplate industry comes from Port Talbot and it is an absolute necessity to improve the quality of coil to meet customer demand. If this is not carried out, it is no exaggeration to say that the tinplate industry of West Wales will face disastrous consequences. The future of the tinplate industry is therefore inevitably and inextricably bound up with what is to happen to Port Talbot.

In the light of the situation facing the tinplate industry in West Wales, I submit that development at Port Talbot takes on a new urgency. The issue is now of such grave national importance that it should be removed from the arena of any kind of battle as between Shotton and Port Talbot, a situation which I deeply deplore, and I am sure that I speak for the steel and tinplate workers of South Wales when I say that they, too, deplore it.

Shotton has been given an assurance that its position is safeguarded at least until 1981—that is six years ahead. That was confirmed in Lord Beswick's interim report which is to be found at column 1164 of the Official Report of 4th February 1975. I submit that the Port Talbot development should be allowed to proceed forthwith, in accordance with the BSC strategy, and the Shotton position, in view of the time that it has in hand, should be re-examined in the light of the market situation as time proceeds.

That, to my mind, would be the most sensible and realistic way in which to reconcile a difficulty which has arisen between North and South Wales, and is one of the causes for the delay in the Government's decision. The steel industry has suffered enough in the past as a result of delays and misdirected capital investment. I sincerely hope that the Government will be wise enough not to let this happen again in the present situation.

I turn now to another important issue that has serious consequences for the Welsh economy. This concerns what the hon. Member for Barry said about civil aviation and the situation in Rhoose Airport in particular. A few days ago, some of my hon. Friends and myself met members of the airport committee and we were deeply disturbed regarding the situation. Rhoose is the No. 1 civil airport of Wales and has been developed to international standards. Its importance extends far beyond the three counties of Mid, South and West Glamorgan which now own and operate it. Its traffic is shared almost equally between scheduled services to many parts of Britain and Europe, linking up with world-wide services, and holiday traffic. There is also substantial executive travel linked with Welsh industry, and the airport has a vital role to play in the economy of Wales.

The financial burden is at present borne by the three Glamorgan counties, whereas the economic and social benefits are felt throughout the Principality. It is totally unfair that the burden should fall entirely on the Glamorgan counties, without any assistance from the Government. In 1975–76 the total deficit is likely to be about £1½ million, of which about £750,000 will represent debt charges. I ask the Minister to tell us why other regional municipal airports in both England and Scotland are in receipt of grants and Wales is treated differently. The situation is illogical and blatantly unjust.

The £5 million redevelopment scheme recently completed at Rhoose has made it among the most modern airports in Europe. It is capable, without extension or further expenditure, of handling up to 2 million and more passengers a year. I would remind the House that the industrial development of Wales has been due in no small measure to the attraction of new firms from other parts of the United Kingdom and from overseas.

Foreign investment has played a significant part on that development, and there are now 150 foreign companies in Wales providing employment for more than 50,000 people. This flow of investment is vital to the future of Wales, because the number of firms from within the United Kingdom that will be expanding in the next year or two is likely to be modest. Every encouragement should, therefore, be given to new foreign investment, and airport facilities are essential for this purpose. Nor should we overlook the fact that in the event of oil development in the Celtic Sea the airport will have an even greater role to play. In the light of all those outstanding facts. I agree with the appeal made by the hon. Member for Barry. The Government's decision not to make a grant to Rhoose, the only major civil airport in Wales, is to be deplored and must be challenged.

I remind the House of what is said in "Civil Aviation Policy Guidance", Command 4899. Referring to the Civil Aviation Authority, it says in paragraph 10: It should encourage the provision by British airlines of services that will foster the development of the United Kingdom's trade and tourism and strengthen the balance of payments. I am convinced that Rhoose Airport answers those conditions. It has an essential role to play in the strenuous efforts being made to improve the economy of Wales and to implement the Government's regional policy. It would indeed be a tragedy if, through lack of Government assistance, such a valuable public asset as Rhoose Airport, started by the old Glamorgan County Council and continued by a consortium of the three county councils, was forced to close instead of being put to much more effective use in the national as well as the local interest.

In support of this matter I quote the words of the Prime Minister at the Guildhall earlier this week: We have to ensure that when world activity revives—and there are signs that this is beginning to happen—we are not precluded from putting forth our full efforts in export markets because of inadequate capacity in terms of investment. In the spirit of that message Rhoose qualifies for full Government backing and investment, and I urge the Minister to use every possible pressure to correct what is not only a grave injustice to Wales but a damaging blow to the development of our economy.

In response to your appeal, Mr. Deputy Speaker, for brevity, I conclude by saying how much I welcome the announcement by the Secretary of State this afternoon of a further programme of advance factories, amounting to a spending of £3¼ million, together with what he described as his new policy in that advance factories could be let to firms already in Wales which can offer satisfactory additional employment prospects.

I have never understood why firms with excellent potential for growth have been stunted because they were operating in grossly inefficient premises and yet were prevented from being considered as candidates for advance factories. I am glad that this inflexible position has been changed. It should not pass unnoticed that the financing of this new programme has been made possible as a result of help from the European Regional Development Fund. I welcome the assurance given by the Secretary of State for Wales that the Welsh Office is now playing a full part in all aspects of our participation in EEC activities and developing close relations with the Commission.

To this end it is a source of satisfaction that Mr. Gwyn Morgan, who was the Chef de Cabinet to Mr. George Thomson, has been appointed to the important post of EEC representative in Wales. I know that the House will wish him well. Mr. Morgan has a deep knowledge of Welsh problems and, with his wide experience in EEC, I am sure that we can look forward to his fruitful cooperation with the Welsh Office to the benefit of our own regional problems.

5.23 p.m.

Sir Anthony Meyer (Flint, West)

I am grateful for this opportunity of taking part in the debate at this early stage because it will give me the opportunity to refer to some of the points made by the hon. Member for Gower (Mr. Davies) on the steel industry. I echo his words on the appointment of Mr. Gwyn Morgan to his EEC post, which I am sure will be of great benefit to the Principality.

The hon. Member for Gower made an eloquent case for going ahead with the British Steel Corporation's plans for Port Talbot. It is pertinent to point out that the Labour Party, and indeed the right hon. and learned Gentleman the Secretary of State for Wales, voted against those plans. The Secretary of State is fond of taunting me about having voted in favour of the Shotton shut-down. I can equally taunt him for having voted against the provision of extra jobs in Port Talbot. However, that is all water under the bridge.

The hon. Member for Gower said that we should not treat this as a Shotton versus Port Talbot issue. The trouble is that it is inevitable that it should be so treated because the Corporation's case for expanding Port Talbot is based on the rundown of steel making at Shotton. I have had no difficulty whatever in demolishing the figures on which the BSC based its case for making the hot-rolled coil at Port Talbot and transporting it to Shotton for finishing. I made my views clear in a letter that appeared in The Times Business News three or four weeks ago. The BSC figures do not for a moment stand up to expert analysis. But what worries me is that at a later stage those figures could be used by the Corporation to demolish Shotton's right even to finish the hot-rolled coil from Port Talbot.

I am sure that the Under-Secretary of State for Wales in his reply this evening will say that he has no intention of letting up in the fight to keep steel-making at Shotton. Despite the great virtues in the Corporation's case, a case can still be made for maintaining steel-making at Shotton. This case is based on support contained in arguments advanced by the Corporation, on general social grounds and also on the ground of need to create employment. We now realise that the unemployment situation is not a temporary phenomenon brought about by the present difficult economic conditions, but that it may be a permanent condition of the British economy resulting from the massive transfer of manpower from productive gainful employment into service industries, local government and so on. In those circumstances it becomes more than ever important to examine every possible scheme aimed at the employment of large numbers of people in productive profitable work, whether in the public or private sector.

I had intended in my speech to attack the Government for their dismal employment record—

Mr. Ifor Davies

Before the hon. Gentleman leaves the subject of steel, perhaps I may be allowed to put this matter to him. The purpose of my speech was to draw attention to the serious effects on the tinplate industry in West Wales. I tried to make the point that the situation in Shotton and Port Talbot can be reconciled. I still believe that to be possible, and the hon. Member for Flint, West (Sir A. Meyer) will do a great disservice to industry in Wales if he ignores the tremendous effects on the tinplate industry and what will happen if we do not develop Port Talbot.

Sir A. Meyer

The hon. Gentleman must not get my arguments wrong. I said that if we were to act on the basis of the Corporation's strategy, it would force us to make a choice between Shotton and Port Talbot. However, there does not have to be that choice, and expansion at Port Talbot can go ahead without Shot-ton's steel-making capacity having to be sacrificed. I want to emphasise the importance of creating additional profitable employment in asset-producing industry.

I intended to launch an attack on the Labour Government for the way in which they had allowed unemployment figures to climb to record heights. I also intended to quote back at them some of the things by which they had abused the Conservative Government of which I was a supporter. However, I will leave those matters aside. I wish to make one vital point—namely, that it would be possible to make a dramatic impact on the unemployment figures if the Government—any Government—were prepared to give priority to the matter.

We hear much talk about the disastrous levels of unemployment and we are told that we must deal with it at all costs. But nobody means "at all costs". It would be possible to create many new and profitable jobs in industry, though not by the kind of methods advocated by the Tribune Group with a form of Schachtian National Socialism, with import controls, rationing and all the rest of it. It would be possible to create those jobs on condition that our people were confronted directly with the need for a severe curtailment in their standard of living over the next two or three years. Such a curtailment in the standard of living not only implies that people will have less money to spend on drink or tobacco or foreign holidays but it means the necessity to tell people that they will have to take a cut in the social wage as well as face deteriorating standards in social services, educational requirements and almost the breakdown of the National Health Service. What I find very much less unpleasant is the imposition of charges aimed at bringing more resources into the provision of the social services.

Mr. Neil Kinnock (Bedwellty) rose

—

Sir A. Meyer

I cannot keep giving way. I promised the Chair that I would be brief and I intend to be brief.

Much could be achieved if the Government gave overriding priority to the creation of employment by releasing resources for investment and by making it possible for those who invest to look forward with confidence into the future and to invest profitably. In other words, the burden has to be shifted from industry to the consumer. This is a hard task, but it can be done. It might just be bearable. It would be unbearable if, on top of that heavy burden, the Government proposed to add the totally unnecessary burden of all its costly grandiose schemes for extending nationalisation. For example, the effect of the Community Land Bill, with its Welsh arm, is already being felt. Jobs are being advertised at a total cost of £500,000 per annum or more. There is also the gorgeous irrelevance of the Welsh National Assembly with its building, clerks, security guards, stenographers, canteen staff, cleaning staff and all the rest. All this is to be borne on the collapsing shoulders of the Welsh taxpayer and ratepayer.

I have said that I will stick to the time I promised to take, and I shall do so. I reiterate that the jobs can be created. Shotton can be kept as a steel producer in addition to Port Talbot provided that the Government mean what they say and that they put the creation of jobs above all else.

5.31 p.m.

Mr. Emlyn Hooson (Montgomery)

The hon. Member for Flint, West (Sir A. Meyer) referred to the growth of the non-productive public sector in this country. He ended his remarks with an attack on the proposed Assembly for Wales and the employment of clerks, security guards, and so on. No Government have greater responsibility for building up the swollen superstructure of administration which is choking this country than the Government which he so slavishly supported between 1970 and 1974.

The so-called reform of local government, which he supported, the so-called reform of the health service and of the water services and the tremendous employment that those services have given in a non-productive sector, together with the enormous increase in the cost—it has doubled in four years—is the secret of what is wrong with the economy.

The world recession is, of course, a reason for the economy of the United Kingdom being sluggish. However, the truth is—and it applies to Wales as much as to the rest of the United Kingdom—that the non-productive sector has become out of balance with the productive sector. I am referring to the productive sector divided as it is between private and public industry. Wales—indeed, the rest of the United Kingdom—will never get back on its feet until productive industry is more in balance with the heavy superstructure that has been inflicted upon it. When I opposed the local government Bill which was introduced by the previous Conservative Government I said on Second Reading that we were imposing on the British economy a load which it could not bear. We are now paying the price for it.

The hon. Member for Barry (Sir R. Gower) referred to the tragic cuts of the past 18 months. Those cuts were inevitable because of what the previous Conservative Government did between 1970 and 1974. I hold no brief for the present Labour Government—do not be mistaken about that.

Mr. Kinnock

They could not afford your fees.

Mr. Hooson

I can afford it more than the hon. Gentleman. The truth is that the blame must be put fairly and squarely where it should rest. However much they might regret it, between 1970 and 1974 the Conservative Government put an impossible burden upon productive industry. What is the result? They can moan as much as they like about the self-employed. The self-employed are crushed by taxes which have inevitably been imposed to support that Conservative Government's superstructure. However good a job NALGO and the Civil Service unions did for their members—they did a super job for their members—they did more damage to the British economy in the process than ever the National Union of Mineworkers was capable of doing. That was a permanent contribution.

I turn to the savage cuts to which the hon. Member for Barry referred. We see the fruits of this process in the cuts that are now being imposed. Where are they being imposed? Today no fewer than three examples of old people who have home helps have been brought to my attention. In the county of Powys a decision was taken at the Government's behest to cut down on all these services. There is to be a 25 per cent. cut across the board for everyone. It does not matter what a person's living conditions are like. I heard today of one lady who was deprived of some of the services of a home help on Monday and today she has been taken to hospital. It will cost the State more, but that is how the cuts are being imposed.

What is happening in Powys is happening in other places. In the same county 120 road workers are facing redundancy. No decision has yet been taken but that may well happen. They will, quite rightly, receive wage-related unemployment benefit, social security benefits and various other benefits. However, it will cost the public quite as much as if they had been kept in employment. The whole process of financing should be examined. What do we do? We pay them wage-related unemployment benefit and social security benefits and let them remain idle? That is what it amounts to because in this country the right hand no longer is aware of what the left hand is doing.

In education there are severe and savage cuts. For example, in my own county for the first time in my lifetime children are being charged 30p for a music lesson in school. If their parents cannot afford it, the children go without the lessons. This is one of the most retrograde steps imaginable.

However, do the public services exist for the benefit of the public or for the benefit of the services? We are reaching the stage where the public services seem to give the impression that they are run for the benefit of themselves.

Have there been any cuts in the swollen administration? None at all. Today who are the most protected against the effects of inflation? Officials, right across the board. It is the wage earners, the self-employed, and the productive workers who are bearing the brunt of all this.

However, the truth is that in principle there is no difference in the exchanges between the Front Benches. They are pin-pricking exchanges as to who did what between 1970 and 1974. Basically, neither Front Bench has the guts or courage to tackle the real problem affecting this country, which is swollen administration. This is the added factor which makes it difficult, even if there is an upturn in world economy, for this country to pay for these services. Everything is already mortgaged, even North Sea oil. We are suffering greatly from over-manning.

The hon. Member for Gower said that there are certain aspects of steel production in Wales where production would increase if the tools were available. Surely it is the way in which the tools are used that is important. Let us compare the production at Llanwern with the factory to which the hon. Member referred in Japan. Is Llanwern inferior because of the tools it has? No, it is inferior in the way in which they are used. We have a great deal to learn about this. Surely our experience of the past few years is that when something is working well, as is the case at Shotton, it would be foolish to do away with it. Whatever modern developments we have in industry, surely we have learnt enough to realise that good industrial relations are worth all the tools that we can manufacture. One may have the most sophisticated industrial tools, but if one has poor industrial relations one's factory is a paper tiger. I should have thought that there was an overwhelming case, therefore, for keeping Shotton as it is.

I move now to another matter—Rhoose Airport. I believe that the Government need to take a longer-term view on this matter. In the present recession, although we realise how vulnerable we are in relation to so many things, it would be dreadful if we allowed the services which we shall need in a more prosperous day to fall into disuse. Rhoose is the only civil airport in Wales, as far as I am aware. There used to be another one, but it is no longer used except perhaps for private aeroplanes. However, Rhoose is the doorway from Wales for air services to Europe.

Now that we are in the Common Market, surely we shall need much greater integration between the Welsh economy and the general European economy. Therefore, Rhoose Airport is important. Those of us who have visited Scotland—as I am sure you have, Mr. Deputy Speaker—have been amazed at the air services provided between the various airports in Scotland by light aircraft joining the main services elsewhere. Feeder aircraft of this kind could be used in different partes of Wales, such as at Valley in Anglesey and at Hawarden and Aberporth, to feed into Rhoose Airport.

Then there is the M4. Surely there should be an extension of that to Rhoose to make available more easily the facilities for the development of that airport.

The Government should not allow the only civil airport in Wales to fall into disuse. It would be a great blow to those who work there but obviously also a very bad blow for the future of the Welsh economy. Although I have no constituency interest anywhere near Rhoose, it seems to me from the national point of view that it is very important.

I turn now to agriculture. Conditions in agriculture this year are very much better than they were last year. Nevertheless, the incomes of small farmers are still very low, as are the incomes of farm workers. It is only in the last few months, I think, that the Government have really appreciated what I have been saying for a long time. That is that food production has been dropping in Britain and that as production drops inevitably a shortage is created, and the greater the shortage the higher the price. The Government are now paying for their foolishness in their first year in office in relation to agriculture. Once one allows confidence in agriculture to be undermined, as with all other industries it take a long time to build it up again. Some people are still cutting down on stock on their farms. The fodder situation is still far from easy.

What Welsh agriculture needs, like British agriculture, is a long-term statement and undertaking by the Government about what they want the farmers to produce and an assurance that they will sustain production. Whether the Government do this by better grants or the end product price in the shops is up to them. I do not worry about the method that is used to support Welsh agriculture and give it confidence, but what is absolutely certain is that this is needed.

What is also needed is reassurance for farm workers. When one considers the importance of the job that they do, one can appreciate that their average wages do not compare with average wages in other industries. It is time that this matter was put right. It also affects small farmers. I know many small farmers who have lived on very narrow incomes, and many farm workers. It is necessary for the Government to put this matter right, by putting agriculture on a sound basis.

I was all for a freeze right across the board, and particularly in the upper earnings bracket. I made no bones about that. If we had had such a freeze it would have enabled us to bring up the wages of farm workers and the income of small farmers to a more acceptable level in the country as a whole.

In conclusion I make one or two points of special pleading. I take the view that it is necessary in Wales to have a very active and encouraged private sector. This is vastly important. The way that the private sector is taxed is also all important. But the public sector is also very important to Wales for industry production. You, Mr. Deputy Speaker, no doubt have recollections of the days when you were Secretary of State for Wales and it was necessary in some areas—mine was one of them—to put in a good deal of public investment in order to encourage private activity there as well.

A good deal of the work was done by the Welsh Industrial Estates. They have a very good record over the years. As I understand it, they are to be absorbed on 1st January 1976 by the Welsh Development Agency. I understand that the staff of the Welsh Industrial Estates are still extremely uncertain about their own future. Perhaps the Under-Secretary will make a statement today on the future of the staff of the Welsh Industrial Estates, along the lines of the recent statement of his colleague the Secretary of State for Scotland. What will happen to the staff? It is very important that they be given reassurance about their future and that their expertise and contacts with Welsh industrialists should be utilised to the fullest extent under the new Welsh Development Agency.

My last bit of private pleading is for Mid-Wales. At a time of recession there is a tendency to pull in the horns. However, my experience in this House—and I have seen recessions previously—is that one must prepare during a recession to make sure that when an upturn comes one can take the fullest advantage of it. The great danger today is that we are pulling in our horns so far that we are in danger of losing the opportunity for expansion when it comes.

I have already indicated where I think a good deal of the economies should take place, in an area which has not been touched by the Government at present. However, the Government should also take steps, in an area such as Mid-Wales, to extend the remit of the New Towns Development Corporation. It has the capability of developing something very much bigger. It should be used in other towns. The previous Government refused to do this, although it seems to me such an obvious step. It would not entail the employment of any additional staff. They could simply extend their activities to one or more other towns. It seems a very sensible step to take, but the present Government and the previous Conservative Government have been stupidly unwilling to take it. It seems that they prefer something much more grandiose, which Mid-Wales does not really require. The tool is at hand. Why not use it much more sensibly than it is being used at present?

5.49 p.m.

Mr. Neil Kinnock (Bedwellty)

Perhaps I may begin with a brief reference, even in his unavoidable absence, to the speech of the hon. Member for Flint, West (Sir A. Meyer), simply to place on record the fact that hon. Members on the Government side of the House do not accept any of the analyses he employed in his assessment of the present economic situation in Wales. The response to him is best summed up by repeating what has been said by the Confederation of British Industry. In August it was telling us—as it is telling us now—that the major reason for the downturn in investment proposals, the downturn in job opportunities and the general downturn in business confidence was the absence of buoyant demand. In the very same breath—indeed in the same paper, and, whenever one of the Confederation's leaders speaks, in the very same sentence as often as not—it tells us that it is not time to reflate.

That is the oldest economic tale we have heard from the Opposition. On the one hand, the description of and reason for the difficulty is given as a deficiency of demand. On the other hand, and in the same breath, the Government are required to continue a savage control of demand. All that that illustrates is the total bankruptcy of any policies for resolving our particular crises, either in the Conservative Party or in the capitalist ethic.

Here we are again, illustrating the idiocy of which Parliament is capable on some occasions. There is much talk of constitutional reform, and it is appropriate that we should be discussing this matter after having sat right through the night and in my case—and I am sure that this applies to other Members—having sat through the morning on a Select Committee and then at lunch time having attended a meeting affecting my constituency. Now we are discussing Welsh affairs at the very buttock of the parliamentary year. That seems to be the place to which Welsh affairs are relegated regardless of which party is in government.

I can only hope that in future parliamentary Sessions we shall manage to elevate the discussion of Welsh affairs to a higher priority. The way in which we are treated in this respect and the way in which the media discuss devolution by referring only to Scotland is turning me into something of a crypto-nationalist. In fact, I shall never be a nationalist because obviously I am much too sensible to fall into that trap and I hold the interests of the Welsh people too dearly, but I can see how the more paranoic of my countrymen may be forced into that view.

I want to discuss unemployment specifically in my county and the enormous additional difficulties which my county has encountered as a result of the rise in unemployment in the past 12 months. In Gwent, between September 1974 and September 1975, as the very useful "Employment and Industrial Trends" publication of the Gwent Planning Department informs us, unemployment rose by 97 per cent. to a figure of 13,760. Among juveniles it rose by over 100 per cent. between those two Septembers to 2,665. Although this latter figure is fall ing, thanks to the implementation of new Government expenditure policies, to the extension of the Community Industries Scheme and to the continual efforts of the careers service in Gwent, there is still a very large number of schoolchildren who left school in July hoping for a secure future in the county of Gwent but still have no firm prospect of a job.

When that happens under a Tory Government, as the hon. Member for Barry (Sir R. Gower) said, we on this side of of the House are loud in our condemnation of the Government. But however loud our condemnation, there is a kind of public resignation about a rise in unemployment under a Conservative Government. When unemployment rises under a Labour Government, whose commitment to full employment is far more resolute than that of a party whose major commitment is to a market system with all the vagaries, vacillations and whimsicality that that involves, we are not simply talking about a campaign to divert the worst aspects of applied Conservatism. We are talking about fundamental questions being asked about the policies which the Labour Government are pursuing.

Labour Members of Parliament, whether they are in the Government or on the back benches, who do not ask these questions and who are not at least as resolute in their condemnation and in their searching for answers under a Labour Government as they are under a Tory Government are not fulfilling the interests of their constituents; they are not maintaining the interests of their class and they are not being true to themselves.

What is apparent under a Labour Government is that the Government are approached ferociously by their own back benchers, in stark contrast to the general approach of Tory back benchers when a Tory Government are in power. I do not say that as a parliamentary debating point. I think it indicates a fundamental difference in the approach of our parties in this House to what we on this side of the House consider to be the overwhelming problem of our society—coming even before inflation in its need for resolution. I refer to unemployment among the people whom we represent.

In Gwent there are any number of figures available to emphasise the novelty and the depth of the problem we face. In Blackwood in my constituency, unemployment has gone up from 8.4 per cent. to 14.9 per cent. In Risca the unemployment rate has gone up from 5.5 per cent. in this most serenely prosperous part of my constituency, to a unique and unprecedented figure of 14.4 per cent. The rise in total unemployment in Britain during those 12 months is 85 per cent. In Wales it is 72 per cent. As I said earlier, in Gwent it is 97 per cent.

Obviously, there is a particular cry from the county of Gwent which has long been regarded as the prosperous southeast corner of Wales. But now it has obviously shown its lack of resilience in the face of the economic storm which we face. Not that there have not been successes. But in September this year I had the blackest weekend in my political life when in 24 hours I met the trade union representatives and some of the management of over 1,000 people in my constituency who were either directly threatened with or had the sack as a result of redundancies in firms in and around my constituency. Fortunately, some of them escaped the sack, but others have not been so lucky. The fact that we could come to that brink of disaster in a constituency like mine is a lesson in itself.

I should like to know from my hon. Friend the Under-Secretary whether there has been a final conclusion in what I hope will be one of the greatest success stories of co-ordinated activity between the Industrial Department of the Welsh Office and resolute trade unionists in the Rosedale factory in Bedwas. The probability is that there is a great success story there.

I shall have to wait until the end of the debate to get a firm response, but if there has been a happy conclusion I would like to take this opportunity of paying a warm and genuine tribute to the outstanding trade union leadership in that plant and to the thorough and dedicated efforts of people in the Department of Industry in Wales before 1st July and those same people who are now part of the Welsh Office. I do not often hand out that kind of compliment to civil servants.

I should like to ask a few questions. First, has the Welsh Office any specific policy for encouraging the refurbishing of the factory in Aberbargoed in my constituency, previously owned by Corah's, where 400 women's jobs were lost in the summer of this year, which was closed down despite the strenuous efforts of the local Labour Party and the trade union? Has my hon. Friend, in addition, any information about the vexatious problem of coal stocks in South Wales? I know that my hon. Friend has received deputations of coal miners and my right hon. Friend the Secretary of State for Energy is meeting the executive of the National Union of Mineworkers today. The NUM and other unions in the mining industry have made known their views on this problem in recent months. I hope the Government can give us a firm undertaking about overcoming this problem and removing the worries and fall in morale which accompanies the continual stockpiling of coal at pitheads in South Wales and at power stations.

The Gwent report, a very intelligent piece of work, concludes that the Government are looking for an upturn in world trade in the New Year and that everyone concerned with the economy in Gwent must ensure that the county is in a position to respond to any upturn at the earliest possible opportunity. As the hon. and learned Member for Montgomery (Mr. Hooson) said, the present depression must be used, unlike previous recessions, as an opportunity to promote structural and economic changes which will guarantee that future development is diversified and resilient enough to withstand any future economic difficulties. This is a tall order for any Government. It means the Government should not take refuge behind world trade difficulties or use the alibi that there are difficulties throughout the country, even in those areas with a traditional image of prosperity. The Government, especially the Welsh Office, must give special attention to creating opportunities for a take-off throughout Wales.

I would like to outline how the Labour movement believes we can overcome our problems. There must be continued attention to improve the industrial and social infrastructure. This goes without saying, but if there is a pause in the progress we have made since the war, we shall have to pay for it in the absence of future opportunities for development. I realise that I am preaching to the converted, or perhaps even the desperate, but every hon. Member should take every opportunity, no matter how boring or repetitious it becomes, to stress that without improvements to the infrastructure in many parts of Wales, we are condemning whole areas to drying up and blowing away as living communities.

We do not want from the Government a repetition of previous carrot and stick policies. Even in the improved form of the National Enterprise Board or the Welsh Development Agency they are not enough. We do not want policies of cajolery, bribery, exhortation and inducement. We want development policies and we also want decongestion policies. If we do not bring people out of the congested areas of the country which have become ridiculously, uninhabitably expensive—areas like the Midlands and the South-East—we shall never be able to get a major and permanent industrial development in the depressed regions of Great Britain.

It is not enough to simply try to sponsor British capitalism which depends, in large part, on Government inducements and their underpinning, underwriting and guaranteeing of the funds which the private market is unwilling or incapable of raising for itself. As a Socialist Government we should be taking full advantage of this situation. We need a planned, organised industrial transition instead of the whimsical and sudden changes of the past. My right hon. Friend the Member for Ebbw Vale (Mr. Foot) has for years called for intelligent anticipation of major industrial changes but has seen the process start only recently. Anybody could see these changes. A child of five could see them and indeed many children have seen them to their cost. Intelligent anticipation will enable us to replace industries as they close down.

These are not dreamy Socialist aspirations or a romantic voice from the valleys. This is the only way communities in the valleys and other parts of Wales can be sustained. It is too late when the axe is hovering over the steelworks or the pit. We ought to be able to make five-year or 10-year forecasts of the needs and production potential of public enterprises. There should be no tolerance of sudden major industrial closures, especially in the public sector.

Nye Bevan once said that there was no need to look into the crystal ball when one could read the book. The book for the people of Wales is their daily newspapers and what they see every time they look down the valleys of Wales. Surely it must be within the capacity of those who have decision-making responsibilities to see that instead of making academic assessments and analyses and setting up boards as the economy is collapsing around them, they get on with the job of doing something before disaster strikes.

Improvements in the infrastructure, a policy of decongestion and development and a policy of industrial transition all add up to something that is anathema to many Members opposite—reflation.

Many people suggest that this is the very last time that we should be arguing for an injection of further funds into the economy. But there are any amount of private funds not being used in the economy simply because there is no direct and immediate opportunity of a quick buck being made. This money goes into various kinds of Government securities, waiting for an economic upturn, and a Socialist Government should be mobilising those resources for the protection of the people for whom this party has historically cared.

I am talking about making decisions. Are we a party whose answer to a broken finger is to amputate the whole arm or are we a party that will use the skill, intelligence and resources at our command to ensure that the finger is made as useful as it was before?

That is the real difference between the two sides of the House, between those who would let the affairs of the world take care of themselves and those who seek to be elected and to attain power in order to control the world for mankind.

6.10 p.m.

Mr. D. E. Thomas (Merioneth)

I am always glad to participate in a debate after the hon. Member for Bedwellty (Mr. Kin-nock) has spoken, and particularly to welcome his conversion to what he described as a crypto-nationalism. I shall see whether I can arrange for the Cardiff office to supply him with a crypto-membership form. We look forward to his support in the coming months, during the discussions on devolution. I am glad that he has at least identified himself as a warm supporter of devolution, both economic and constitutional.

I agreed with the major theme of his speech on the basic issue of unemployment. My hon. Friend the Member for Caernarvon (Mr. Wigley), if he catches your eye, Mr. Speaker, will want to develop that aspect, but, without pre-empting what he might want to say, I agreed entirely with the analysis by the hon. Member for Bedwellty, particularly when he pointed to the experience of the more prosperous parts of Gwent which are now suffering what many areas in Gwynedd have had to suffer for a long period.

The hon. Member mentioned the percentage increase in unemployment in particular areas of Gwent which have to face rates of 14 per cent. or so. There are areas of Gwynedd, such as Caernarvon, Holyhead, and Blaenau Ffestiniog, which have had to contend with unemployment levels of this kind under successive Governments. These towns have unemployment levels comparable with those that the hon. Member quoted for Gwent. Hon. Members, like myself, who have empty factories in their constituencies, who feel that they have been knocking their heads against a brick wall in the last two years in attempts to attract tenants into the factories—I mention the specific case of the Forgings and Fasteners factory at Blaenau Ffestiniog—want a specific date when the Welsh Development Agency will become fully operational. We are looking to that agency to provide the kind of public investment about which the Minister spoke and which has not been forthcoming from the private sector in large parts of rural Wales. Where it has been forthcoming, in all too many instances it has been with the kind of difficulties that have attended the firm of R. A. Good all, in Dolgellau, in my constituency. That company is a case in point—a company which can retain its existing level of employment for only a few more weeks, or, at best, months. It is that kind of company which could benefit so much from the flexible type of intervention which we are hoping for from the Welsh Development Agency.

I want the Under-Secretary to tell us when he foresees the agency being fully operational, and to confirm that it will be able to intervene actively in situations of this kind. Does he agree that the setting up of production units in empty factories such as the one in Blaenau Ffestiniog should be a priority for the agency? Unemployment brings with it no only personal problems of redundancy but the problem of a sudden drop in income, when the earnings-related unemployment benefits run out. It also brings with it the social problems that we have faced for so long in large areas of industrial Wales.

I am very concerned about the impact that the cuts in public expenditure will have on social policy in Wales. To be unkind to the Government, I could say that the major act of policy for which they will be remembered is cutting public expenditure. Such cuts go much further, in their effect on the lives of ordinary people, than do any other policy decisions. There are the young children who will not be able to go into nursery schools and the old people who have had cuts in their home help services. The personal social services, yet again, are being subjected to severe reductions.

I am concerned about the unselective nature of these cuts, at the inability of Government to look at different districts to see whether there are areas of relative deprivation, and their failure to ensure that there will be no reduction in spending in development areas or special development areas. Instead, there is a blanket demand on all the personal social services in local authorities in Wales to reduce expenditure. There is no attempt to see whether the reductions will cause even greater social deprivation for specific problem areas than these areas have suffered in the past. I appeal, therefore, for greater selectivity and sensitivity in the reduction of public expenditure in the personal social services.

In an attempt to find out what is happening I have contacted all the county councils in Wales asking for a full list of the projects that have been cut back. With the commitments imposed on the social services by higher unemployment, there are many areas in which social workers are dealing with families affected by unemployment. They face a massive case load. In those circumstances, their efforts will become less and less effective.

In this kind of inflationary situation, the level of social security benefits is being increased from 17th November, but it is one thing to increase benefits and another to ensure that the level of services is maintained. This is a difficult choice for any Government. If, for example, we were globally to reduce the next pensions increase by 5p there could be a minimum transfer of about £20 million into personal social services throughout Britain. The Government must consider this point more closely. What is best for an old person in Powys or Gwynedd? Is it to have an extra 5p on the pension, or to have the home help for an extra hour or two each week?

Families are experiencing problems which need social support work and family help. The higher incidence of relative poverty is exacerbated by unemployment. Thirty per cent. more people in Wales are dependent on supplementary benefit than is the case in the United Kingdom as a whole. We are greatly concerned that the Government appear to be following the traditional approach of their predecessors in introducing and continuing means-tested benefits for local authority services. The low take-up of the exemptions from charges for these services must be of concern to us all. The Government are persisting with the system of imposing charges and granting exemptions, which means in most cases that the take-up is only about 50 per cent. and occasionally up to 80 per cent. of what it should be. That means that a significant proportion of people who should be getting a service free are not benefiting. It is similar to what happens when one asks for a bilingual form. One has to make a special approach, and fill in a special form to get benefit or exemption.

The Government are planning to introduce a new means-tested benefit in the form of the exemption from school transport charges. I was appalled by parliamentary answers this week from both the Welsh Office and the Department of Education. They imply that no work has been done on the costing of this new school transport policy, in real terms. I accept that it is only in the consultative stage, but I hope that the costing will be done properly. I see here another example of the Government's perpetuating the kind of charges policy, with the impact that it will have on individual families, which was the hallmark of the social policy of their predecessors.

I wish to stress the concern felt by many of us that the primary school building programme will suffer next year in the same way as the nursery programme has already suffered. We had some defence of the primary school programme this year, but because of the higher percentage of children in Wales who have to go to older schools, particularly compared with the prosperous regions of the West Midlands and South-East England, the Welsh Office should make clear, in its negotiations with the Treasury on the school building programme, that there must be no cut-back, when it would mean more Welsh children remaining relatively deprived in the school buildings they attend.

I also stress once again the position of teacher training in Wales, and the particular need of the Bangor Normal College. I am anxious that in the ongoing discussions, when the future of the institution is being reconsidered, those involved should take into account teacher training and the demand expressed in the recent Welsh Council report for nursery Welsh-medium teachers. They should be taken into account because it is from such an institution as the Bangor Normal that we have seen an outflow of highly trained Welsh-medium teachers. One might also speak of an outflow from that college of Under-Secretaries of State for Wales.

Discussions are going on in the University of Wales on the possibility of setting up a Welsh-medium college in the public sector. That is likely to be recommended by a working party of the university. We have such an institution in existence in the Bangor Normal College. We do not want to destroy it and then have to re-create it.

We have already had an opportunity, in another debate, to discuss the health service generally, but I wish to emphasise the impact of health service cuts on Wales. I have already referred in other places to the attitude that the Welsh Office, as part of its policy for reducing expenditure, has felt compelled to take towards the Gwynedd Area Health Authority, which has more or less been kindly told "If you want a new district general hospital in Bangor, you will have to slash community health provisions." That will particularly affect community health provisions in my constituency. It will not only effect the Blaenau Ffestiniog health centre; it will also severely curtail family planning services in Gwynedd. That is a regressive step, because it goes against what I would have hoped would be the attitude of the present Government, that wherever possible there must be a switch of resources from district general hospitals, from the hospital programme, into community health care and the personal social services.

I talked about that matter in another debate, when I called for joint financing of health and personal social services, to enable that kind of switch of resources to take place particularly as it affects the mentally handicapped. When it considers the allocations of the area health authorities in Wales in the next financial year, the Welsh Office should look carefully at the effects of its cost-cutting policy, to make sure that we do not find our community health services being severely reduced in the coming year.

A working party has been studying the reallocation of services within the health service in Wales. Will the findings of that working party form part of the new allocations for AHAs for 1966–67? That is an important question, particularly in Gwynedd, an area of historic under-spending under the old Welsh Hospital Board.

I come to the major question in social policy, that of housing. When he opened that debate, the Secretary of State for Wales said that 5,000 houses had been built in Wales in the current year, and that that was an improvement of 114 per cent. on the record of his predecessors. We are all grateful for that improvement, but when we contrast the figure of 5,000 new houses with the 60,000 people on council house waiting lists in Wales we see the real shortfall.

My party demanded, almost a generation ago—certainly a political generation ago—that there should be a yearly target of 25,000 in respect of new houses built in Wales. No Government have come near to achieving it. Not only have completions been cut; there are now cuts in the council house improvement programme. One estate in Blaenau Ffestiniog is suffering from those cuts.

There has also been a cut in the improvement grants programme. The other Under-Secretary of State—the hon. Member for Rhondda (Mr. Jones)—told me yesterday in a parliamentary answer that the finance made available to district councils for improvement grants in 1974–75, at £31.1 million, was to be reduced to £13.3 million for 1975–76. He added that the total value of applications made to district councils for improvement grants was not known, but it was estimated that total grants paid out by councils were £28.7 million for 1974–75. Although there is an increasing demand for housing improvement grants, the means for meeting that demand are being severely curtailed.

In addition, in local government mortgages we have seen a further cut. We all welcome the £5 million that the building societies are putting forward, but from the correspondence that I have had with the building societies on the issue I am not satisfied that the 800 mortgages that will be forthcoming as a result will go to the people who would have had local government mortgages. A letter from the building societies indicated that there would be a plan whereby a person wanting to borrow could take a letter from the district council to the building society, and that that would be some sort of passport to lending.

How will the plan work? Are the Government satisfied with the progress of discussions with the building societies? Are they satisfied that the £5 million will go to people who would have had local government mortgages? It is those people—people on low incomes, the self-employed, people who do not have a regular level of wages, younger people, first-time buyers, people going for older property—whom the Government have clobbered by the cut-back in local authority lending.

I have been told that the £2.5 million that has been allocated to help the construction industry in Wales is going to housing improvement work, which is labour-intensive, and that it will be shared between the public and private sectors. The Department should be more specific and tell us exactly where the money will be spent.

Over the next few months there will be a great housing debate in Wales, which will be the major issue as we come up to the May elections. I suspect that the Government have up their sleeve a plan whereby some great lendings will be promised in April, the beginning of the next financial year, that they may last for about a month, to tide the Labour Party over the district council elections, and then be cut later next year. If that is the Government's trick, I have trumped it by saying that.

As we face a deepening economic and social crisis in Wales, the areas of historic deprivation are the ones which have been hardest hit—areas such as Blaenau Ffestiniog, and the valleys of South-East Wales. The valleys are being hard hit with housing and educational problems. The hon. Member for Bedwellty spoke of coming north recently. I have been south in the past few weeks, meeting people in the valleys. As I meet people there, I find the strong feeling that the next few months will be crucial in deciding the political future of Wales.

The Government are being judged on their social and economic policies, and they are seen to be severely wanting.

6.30 p.m.

Mr. Geraint Morgan (Denbigh)

I shall do my best, Mr. Deputy Speaker, to respond to the appeal which you made at an earlier stage of this debate, bearing in mind that this is a truncated debate and that, very shortly, along with the parliamentary Session, it will be brought to an abrupt end. In the circumstances, I shall restrict myself to two subjects. I shall first deal with agriculture, a subject which was referred to briefly by the Secretary of State in the earlier part of the debate on 30th October and rather more broadly by the hon. and learned Member for Montgomery (Mr. Hooson) this afternoon. I shall also refer to water, which, as far as I can recall, has not been referred to in this debate at all.

The hon. and learned Member for Montgomery said that he was not really all that concerned about methods of support. I do not think that we can leave the matter at that stage. I hope, in the course of my short speech, to make some specific suggestions for an improvement of the agricultural situation and to suggest some specific remedies.

I dare say that most Welsh, and, indeed, English, agricultural Members would agree that the greatest problem that has beset farmers over the past two years—I accept that this goes back to the previous Conservative Government—has been the enormous escalation in costs, especially costs of feeding stuffs and machinery. Allied to that, there has been the problem of what has come to be known as the green pound. I appreciate that decisions to adjust the value of the green pound cannot be taken lightly. Such adjustments inevitably have an effect on food prices. However, making all allowances, I think that the Government have tended to pussyfoot round the problem. I do not think that the Government are grasping the nettle as firmly as they should. A realistic revaluation of the green pound would go a long way towards meeting the difficulties of the farmers without any further, or any further substantial, action.

I can tell the Under-Secretary of State without fear of contradiction—I have no doubt that he will pass this on to his right hon. and learned Friend—that the farmers in my part of Clwyd, and, indeed, the whole of what used to be the county of Denbigh, feel more strongly about a realistic revaluation of the green pound than on any other issue. Therefore, first, there is an unanswerable case for the Government to take action immediately to close the gap that still exists between the green pound and the real pound. Secondly, the Government should arrive at a formula whereby the two pounds can be kept broadly in line thereafter.

I want to be constructive in what I have to say in this debate. Of course, I hope that I am always constructive. In fairness to the Government, there have been four adjustments to the green pound during the past 12 months. The last adjustment amounted to 5.8 per cent. and brought the green pound more closely into line with its present real value, thereby substantially reducing the monetary compensation amounts. However, those adjustments have not gone far enough. The fact that there have had to be so many adjustments in the space of 12 months—they have all been as a result of pressure brought by the agricultural unions—serves only to emphasise the basic injustice of a system by which farm prices have been fixed by an artificially over-valued pound while the real pound has drifted inexorably downwards in value.

I was pleasantly surprised to learn from an answer I recently received from the Secretary of State that the disparity between the green pound and the present market rate of the pound sterling has been narrowed to about 5 per cent. That is, however, the best argument for closing the gap altogther. I understand that the most recent adjustment of 5.8 per cent. is likely to have only the most minimal effect on the cost of living—namely, approximately a quarter of 1 per cent. Such increases in food prices as would result from the complete removal of the disparity between the two pounds would be a small price to pay to stop the trend of a declining home food production and the risk of soaring prices later. At the very least, one should be entitled to expect a review of the relative values of the two pounds every two or three months. I hope that the Government will be prepared to concede that at the very least.

I think it is true to say that the urban public now appreciates the dangers that lie ahead and that jobs in agriculture and associated industries are unnecessarily at risk at a time of growing unemployment. One example can be drawn from my own constituency. As a result of the cut-back in milk production in the Vale of Clwyd, nearly half of a 100-strong creamery at Llandyrny, near Denbigh, will be laid off before Christmas. The possibility of that redundant staff being redeployed elsewhere in the Vale of Clwyd is remote in view of the continuing increase in the level of unemployment and the relatively few large industrial enterprises in the area.

In tins context, we cannot leave out of account the fact that last September Welsh unemployment reached nearly 76,500, or 7½ per cent. Those are the worst figures since the Second World War.

Were it not for the shortage of time I should be tempted to say more about the difficulties of the dairy farmers, who are, of course, the backbone of the Welsh agricultural economy. Suffice it for me to say, entirely without prejudice to the green pound issue, that the price of milk to the producer should be raised immediately to a level at least sufficient to arrest the current decline in milk production. That decline has been very marked in Wales, where the number of milk producers has fallen by no less than 7½ per cent. in the past year alone. It is doubtful whether the measures recently announced whereby there will be an increase in the price of milk in two stages this autumn will have that effect. However, giving the Government the benefit of the doubt, those measures will do little, if anything, to restore the level of milk production to that of a year ago.

There are two further policies that, with respect, the Government could consider with advantage in an effort to assist agriculture. I have advocated one such policy many times in debates in the Welsh Grand Committee, but I do not think that I have had a reply to my suggestions so far. Bearing in mind that it is the meteoric rise in the cost of feeding stuffs more than anything else that has been the cause of agricultural difficulties in the past two years, there is a strong case in my view for the reintroduction of something like the old "feed formula". That formula was applied to pig production only, when it was in operation, but it could properly be applied as a temporary measure to other sectors of agriculture.

I am conscious of the fact that the formula was abandoned by the previous Conservative Government as part of a package deal with the Community some two and a half years ago. If I may say so, it is not a move for which I would give the Conservative Government any very good marks. I see no reason for our not now seeking the permission of our Community partners to re-introduce, at least for a limited period between now and the end of the transition period, something similar to the feed formula.

I would urge the Government to give favourable consideration to the recommendation made by the NFU in a recent statement, in which it said that the Government should commit themselves to the principle of intermediate reviews of agricultural support prices so long as the rate of inflation remains above 10 per cent. per annum. Unhappily, that is likely to remain the situation for some time. As the NFU has rightly pointed out, an arrangement of that kind will give to agriculture no more than the right enjoyed by other industries to apply to the Price Commission for increased prices when input costs reach a certain level.

I turn briefly to the issue of water rates. It is especially appropriate that some mention should be made of the matter in this debate not only because we have suffered a far greater increase in the water rates in Wales in the past 18 months than in any other part of the United Kingdom, but more particularly because the report of the Daniel Committee appointed by the Secretary of State to examine the problem was let loose on the world a few days after the House rose for the Summer Recess. As yet, therefore, we have had no opportunity of discussing the Committee's recommendations.

At the same time, there is intense public interest in Wales as to what steps, if any, the Government propose to take pursuant to the Committee's recommendations, and also in respect of the sewerage rates as they apply to premises that receive no mains sewerage services. There are many such premises in rural Wales. As evidence of this intense public interest, when I spoke to some ratepayers on this subject at Abergele in my constituency nearly 400 people attended, an appreciably higher number than came to all my last General Election meetings put together.

The fact that the Judicial Committee of another place only recently considered an appeal on a matter of sewerage rates—it was a consideration of the legality of the levy of a sewerage rate in respect of premises in respect of which no service was being provided—and the fact that judgment has not yet been given in that case precludes me from expressing any view on the law as it stands.

That in no way inhibits me, however, from asking the Minister for an assurance that, whatever the result of the appeal in another place, the obviously just principle of "no service, no rate" will be adopted, if necessary by means of legislation.

To turn to the subject of water and water charges, I have great confidence in the integrity of the Secretary of State on this issue. When, at that meeting I have referred to in Abergele, I was asked whether I thought that the Government would implement the recommendations of the Daniel Report, I replied that I was sure that they would do so, because these astronomic charges have been a matter of grave concern to members of all political parties in Wales. I hope that my confidence was not misplaced, and that the Minister will be able to enlighten us, either during the course of this debate or in the near future, about the action the Government propose to take—if not immediately at any rate within the next few months—consequent upon the Daniel Committee's recommendations.

One proposal made by the Daniel Committee which appears on page 65 of that brief report is: consideration should be given to the early introduction of a revised scale of minimum charges to deal with the problem of those consumers who use small amounts of water and have to pay extraordinarily large sums because their present charges are based on the high rateable value of their premises. This would appear to be a highly desirable reform, not only in Wales but throughout the United Kingdom. It is particularly desirable in Wales because of the especially high incidence of water rates there. I am sure that thousands of Welsh ratepayers will be glad to learn what steps the Government are contemplating in this direction.

I turn now to Recommendation (iv) on page 65 of the report which reads: Consideration should be given to extending the use of meters to all consumers whose bills for water are large enough to justify the cost of metering. If I remember rightly, the Labour Party when in opposition did not take very kindly to the clauses on metering in the Water Bill while it was going through its processes in this House in 1973. I think I can say that this would be a reform that would commend itself to a large section of the people. I hope, therefore, that the Labour Party will have had a change of heart on this issue, more particularly as this change is specifically recommended by the Daniel Committee.

The next recommendation I should like to refer to is Recommendation (vii), also on page 65 which, among other things, states: consideration should be given to the need for giving the water authorities greater freedom of action in matters of borrowing. No Welshman has been more critical than I of the apparent lack of financial expertise on the part of the Water Development Authority. In fairness to the authority, however, it should be emphasised that it has been statutorily obliged, for reasons which I am bound to say I have never understood, to borrow money in the dearest markets. This is something that could be remedied swiftly by the acceptance of the recommendations.

In my references to recommendations by the Daniel Committee I must of necessity be selective and I am only drawing attention to those which I feel could be the subject of early action by the Government. I do not intend to become enmeshed in the proposals that the Committee makes with regard to the powers or functions of a possible future Welsh Assembly with regard to Welsh water services, depending upon whether or not such an Assembly is granted executive responsibility over water. That is something which can be more properly considered when we discuss devolution in the next Session.

I would like to ask the Minister for his observations on the last two recommendations in the report. The first of those is that if the Welsh Assembly is to have only advisory responsibility for water, or if the present organisation is to continue unchanged, the Secretaries of State for Wales and the Environment, respectively, should be given the power to direct a water authority to operate a levy subsidy scheme and to reduce charges to Welsh National Water Development Authority consumers to a level not more than 10 per cent. above the national average. What is the likelihood of such a scheme being adopted?

I would like the Minister's views on the last recommendation—perhaps I might call it the sting in the tail of the report—namely, that as a strictly interim measure, an Exchequer subsidy sufficient to achieve that objective should be given to the Welsh Water Authority. I do not expect answers to all of these questions at the end of the debate but I hope that the Minister will accept that they are serious inquiries commanding considerable public interest. If the Minister cannot reply to them tonight I hope that he or his right hon. and learned Friend will do so by way of correspondence with me as soon as possible.

6.45 p.m.

Mr. Fred Evans (Caerphilly)

The issue of unemployment has rightly played a considerable part in this debate. The area mentioned by my hon. Friend the Member for Bedwellty (Mr. Kinnock) lies within the catchment area of my own travel-to-work area at Bargoed. It has become a trite observation that for the person who is unemployed it is 100 per cent. unemployment, not 1 per cent. or 2 per cent. or whatever statistics we may want to fling about.

One of the interesting things is that in this place there is a tendency to recognise the world situation while in Wales we have strident voices raised which pin everything on the Labour Party, whether in or out of office. It is the Labour Party which is responsible if there is a dole queue. If Mrs. Jones' sink cover is faulty, it is the local Labour Party that is responsible and so on.

The problem of government in Wales will rest—when talking of the social services—on production, investment and the wherewithal to carry out the multifarious demands being made upon a Labour Government. Equally, the political institutions which may be envisaged for Wales will depend upon the economic base provided for those institutions. I have always believed—I welcome the fact that the Welsh Development Agency has some teeth—that we should have had direction of industry into the regions, regardless of the outcry—and that we should have had the establishment of Government-sponsored factories, not advance factories, long ago at the time of the setting-up of industries in the regions. When we look at the recognition of the world phenomenon of recession, and recognise the tragedy of the individual involved in probably one of the most traumatic experiences in life, that of being unemployed, we must realise that there are other areas which are also severely hit.

While the figures quoted by my hon. Friend the Member for Bedwellty are accurate and apply throughout the whole of the valley which he and I share as representatives, there is, nevertheless, in London a chronic situation with an unemployment figure, in Poplar, for example, of well over 12 per cent. It is not an isolated phenomenon for Wales. Those people in Wales who would like to treat it as such, and use the Labour Party as the whipping boy for any and every cause of disaster, do no good to Wales.

The control of unemployment and of inflation are very important issues for Wales, but towering above these at the moment is the question of what is to happen to the political institutions in Wales.

As you are aware, Mr. Deputy Speaker, there stands on the Order Paper, in my name and the names of my hon. Friends the Members for Bedwellty and for Swansea, East (Mr. Anderson), an Early-Day Motion giving an opportunity to hon. Members to express some kind of opinion as to the road we ought to tread if we want to find a solution acceptable to the regions within this country.

This Early-Day Motion has already attracted 60 signatures, drawn from Scotland, from Wales, and from every region of England. There are signatures from Members of Parliament in Wales and from expatriate Welshmen representing English constituencies, so that it is a widespread, representative view held in the House of Commons. It will, I do not doubt, attract further signatures, possibly realising about 100, which would be a very substantial representation of a point of view.

This feeling has grown up because we have in Wales a very ambivalent attitude and a great ambiguity of speech in talking of these things. It is being openly claimed that a political institution such as a Welsh Assembly will be treated as something on the way not simply to a Parliament for Wales but to separatism for Wales. Most of the Welsh people will have no part in this. If evidence is required, I have letters here which I have received from all over Wales, which amply support my contention.

I have one from a senior civil servant who, because of the terms of his employment, is unable to divulge his name. He has expressed his anxieties in a letter to The Times, which he sent to me. He is disturbed because he feels that the Labour Party has not more urgently and more frequently got over to there public the dangers of the drive towards separatism by elements in Wales.

I have a letter from two professional people in the constituency of the hon. Member for Carmarthen (Mr. Evans). I am glad to see that in this letter there is a willingness on the part of the writers to acknowledge some debt of gratitude for the benefits they have received. Although these people are Welsh, they were educated at London University. One is a doctor and the other a lecturer in a college of education. They are both highly qualified, and acknowledge the debt they owe to England for the provision of opportunities. They add: Our two sons have been educated in England, at considerable sacrifice to us, because we were not happy about the educational system in our area. They are now at London University also, and have expressed their reservation about returning to Wales to work, in view of the increasing anti-English feeling which is being generated here by a small minority, influencing the apathetic majority. Whether that claim is accepted by hon. Members opposite or not, it is a statement in a signed letter from Carmarthen, therefore notice must be taken of it.

Mr. Dafydd Wigley (Caernarvon)

Would the hon. Member care to confirm that the doctor is on the short list for the Labour Party nomination in the Carmarthen constituency?

Mr. Evans

I have no acquaintance whatsoever with this doctor. I can assure the hon. Member of that.

Mr. Kinnock

He would make a very good Member of Parliament.

Mr. Evans

I have a letter from Swansea, in which practically the same kind of argument is made. The writer speaks from personal knowledge of the Swansea area. He says that most people in the area object on grounds of principle and will not have any part in it. People are not backward in writing to my party, because they feel that the Labour Party has not done enough to point out the dangers.

I have a letter here to the Minister responsible for producing any proposals, ticking him off for alleged dereliction in this direction. I am interested in the future prosperity of Wales and the greatest happiness of most of its people, and I am not over-concerned as long as we see clearly where we are going and the implications of what we are doing.

We must pose the question whether the economic resources are sufficient to support a separatist Wales. It is being claimed by some that they are, as was shown by the speech of the hon. Member for Carmarthen during the recess, in which he said that he is not anti-English but anti-British. On television last Friday, when asked by me about this, he said that he wanted regions in England to have the same good things as Wales, which was very magnanimous of him but did not tell us very much about anything.

When it was suggested that a Welsh Assembly could bring education under its aegis, including the terms of appointment, salaries, and the negotiating powers of the teaching profession, the national daily, the Western Mail, carried a banner headline indicating that teachers were cool towards this idea. It quote the field officer of the National Union of Teachers in Wales as saying that for many years it had worked towards evolving a policy of comparable benefits, salaries, and so on, throughout the United Kingdom, and that any kind of attack on this policy would have devastating results.

This week the National Farmers' Union in Wales has recognised that the whole of the United Kingdom is its market and that its members stand to suffer if the United Kingdom is not regarded in that light.

Some very interesting questions arise from this argument. Recently, at the Guildhall, the Prime Minister stated something that a number of us on the Labour benches have been urging for longer than we care to remember—that the key to Britain's prosperity is the energy situation.

I well remember the time when all coalfields operated on a regional basis, so that the wages and conditions of miners working in pits in Scotland, in Wales, in the Midlands and elsewhere were essentially different. It took a long and hard struggle, after nationalisation, before it was possible to evolve the National Union of Mineworkers and a system whereby miners were given grades and could move from one area to another, carrying their grade with them.

Are we now to be faced with a situation in which, at a time when vast developments are taking place—such as the one at Selby, where there is a coalfield with 100 million tons of coal, and seams 12 ft. thick requiring a double cut—there is to be a return to the kind of regionalisation that we knew in former days, with differentials in wage structures, different trade union organisations, and so on? I believe that it is right that such fears should be expressed.

Mr. D. E. Thomas

I speak as an active member of the Transport and General Workers' Union. The hon. Gentleman has given us a catalogue of various organisations in Wales which are against devolution. Can he explain why the TUC in Wales has repeatedly supported legislative devolution, as has the NUM, and has now demanded greater economic powers for the Welsh Assembly?

Mr. Evans

The hon. Gentleman must do his own research—but fears have been expressed by someone in that union who is a little senior to the Welsh Executive, about the effect of separatism on his union.

We have to face this problem. We have farmers expressing their views. We have teachers expressing their views, and I have no doubt that all other public servants will follow. In industry, too, this is the point which must be brought home.

I have read the studies produced by Plaid Cymru, and I have seen no hard documentary evidence to support any claim that the existence of a separate Wales would not be other than devastating for the country in economic terms. I am open to being convinced to the contrary. But what the Welsh people have to bear in mind is that the multifarious services for which a clamour is going up here tonight are such that Wales must depend on the economic base of that country, and that if that is unsound, all goes.

The Welsh people had better start asking themselves some questions, just as certain trade unions are. They had better start asking themselves whether such an economic base could successfully sustain even the levels of social benefits for people who are unfortunate, like those referred to by the hon. Member for Merioneth (Mr. Thomas). That is a serious question. If people are laying claim to power, we are entitled to know what they intend to do with power. This has been preached by the Labour Party in Wales long enough. Let us see what alternatives can be produced. I am sure that many people re asking this question and are convinced in their minds that we shall see a drift towards a lower scale of social benefits such as those that we see in southern Ireland.

Mr. D. E. Thomas

Rubbish.

Mr. Evans

It is all very well for the hon. Member for Merioneth to say that. People forget that it is not long since his party issued a pamphlet announcing to the Welsh people "A rich Wales, or a poor Britain?" I suppose that the hon. Gentleman's party thought that Celtic oil, provided that it was used greedily for one section of the country, would lead to an isolated prosperity inside a bigger entity. That pamphlet has been conveniently forgotten. People like me asked, "What oil?" Lo and behold, like a dream vanishing in the dawn, most of the oil rigs have been withdrawn from the Celtic Sea and serious doubts are being expressed about the volume of oil which could be found and its contribution to the total energy needs of the country.

Mr. Wigley

Without going in detail after the oil, but bearing in mind that a member of the hon. Gentleman's party only yesterday made a major speech on its importance, I remind the hon. Gentleman that this year people in Wales will be £240 per capita more in debt as a result of the policies being followed by this Government. The Government may argue about whether we can establish a rich Wales. What is certain is that we are going towards a bankrupt Britain.

Mr. Evans

In a world with shrinking communications, anyone suggesting that people can be isolated in little areas of prosperity is living in the same realm of fantasy as the man who spells his name with five or six "fs". A week ago last Friday, there appeared on the television programme "Outlook" a man who wanted to set up little enclaves in Wales with monoglot Welsh people. Then there was someone from Aberystwyth University who said, "No. Rather than that, we must penetrate every home in Wales." That is the kind of arrogant view that we hear expressed when these matters are discussed. I shall not be so unkind as to refer to the devastating article in today's Western Mail on the activities of that party and its language section, most of whom are members—

Mr. D. E. Thomas

Is the hon. Gentleman saying that our party has a language section? May I remind him that ours is a political party which has been campaigning for 50 years—

Mr. Evans

I have no doubt in my mind that nearly all the members of Cymdeithas Yr Iaith Cymroeg are members of the hon. Gentleman's party. There is a great deal of interlocking. It creeps out in all sorts of directions. There is this urge towards autocracy under the name of devolution, with a step to an assembly, another to a legislative assembly, and so on. Even during the sacred week in North Wales when we held a referendum on the question whether the pubs should open on Sundays, we saw on television lady members of the hon. Gentleman's party saying, "Wait until we get our Welsh Assembly. We shall close all the pubs on Sundays."

Mr. Deputy Speaker

Order. If the hon. Member for Caerphilly (Mr. Evans) goes on long enough, he will close the debate.

Mr. Evans

I apologise, Mr. Deputy Speaker. Seriously, though, we must have an explanation, not from these benches, about various areas of public expenditure. In Wales, we want a detailed examination, by those who lay claim to power, of the way in which they could support what has appeared in so many of their declarations—the urge towards building up Wales as a separate entity.

7.7 p.m.

Mr. Ian Grist (Cardiff, North)

I hope that the hon. Member for Caerphilly (Mr. Evans) will forgive me if I do not immediately take up the main theme of his speech. However, I shall have one or two comments to make on it later in my speech.

In present conditions, this is an extraordinary, if not a debilitating, debate. This is the first time that we have had a chance to review the performance of the Secretary of State and the Labour Government—apart from March 1974, which was what might be described as a starting point—and it is a thoroughly unsatisfactory situation. I am sure that everyone present will agree about that.

Here we are, in this period of Labour Government, and every hon. Member has hair-raising stories to tell about unemployment, and about factories which lie empty in his constituency. In my own, I have a 50,000 sq. ft. advance factory lying empty. Unfortunately, I cannot see it being filled for some time.

Everyone who can read and count will now realise that this Government have failed at every turn to take the right action until they have been forced to do so by the pressure of events and facts.

First, we had the interregnum period last year, when there was a grovelling desire to seek office. It was not a matter of seeking power; it was simply a matter of seeking office. Now that reality is breaking through, I cannot think that anyone is surprised about the difficulty experienced by Labour candidates in South Wales in holding on to any local authority seat which comes on the market.

The second reason for delaying action was the lack of capacity of a disastrously divided party to take any action until it could not escape doing so. At the time of the last election we heard Labour Members rabbiting on about the need for strong leadership and a clear majority. We then had a referendum on the Common Market, which certainly was no example of clear leadership and a determined use of a majority in the House of Commons. What a farce it was. At last we are receiving money from the Common Market to help Wales, which is probably suffering more than any other part of the United Kingdom, apart from Northern Ireland, from the present economic circumstances.

I am surprised that the Secretary of State is not present today. There may be a good explanation for his absence. If so I should be glad to hear it. However, he opened this debate some days ago, and we are at present having a continuation of that debate. We are debating the Secretary of State's Department, and in my view he should have the courtesy—

The Under-Secretary of State for Wales (Mr. Barry Jones)

My right hon. and learned Friend the Secretary of State is leading a parliamentary delegation. I understand that the hon. Member for Pembroke (Mr. Edwards) is engaged in similar activities.

Mr. Grist

That is most interesting. However, I take it that the Secretary of State has gone in another direction, because I saw him in the car park earlier this morning. I think I can guess where he has gone. Indeed, if I am correct in my assumption I rather envy him. In his February 1974 election address to his constituents the Secretary of State said that the Shah of Persia could call the tune and two Cabinet Ministers would go running to St. Moritz, Switzerland.

I do not know whether that was an "Americanism", or his way of explaining to his constituents where St. Moritz was situated. We do not hear about the Secretary of State being concerned about Cabinet Ministers going to Tehran or bowing to princes at airports. Oh, no. We are grateful to have the loan of any money we can lay our hands on, to make sure that Welsh water flows.

We should be grateful to the private sector in Wales. There has been an increase of 60 per cent. in exports from Wales during the past two years. That increase has been largely due to the private sector and not to the State sector.

We must also pay tribute to the work done by the Development Corporation for Wales. However, still the Government refuse to face the facts or to take the steps which they will be forced to take in worsening circumstances.

When shall we hear a clear announcement about the future of the steel industry? I believe it right that people working in that industry should be given a firm indication of what is happening. They have lived under a cloud of uncertainty for too long.

The autumn edition of British Steel says: Until the Shotton-Port Talbot decision is taken, planned investment at Port Talbot cannot be made, in the past year costs for the proposed Port Talbot development have risen by about £119 million". If that figure is correct, it indicates an incredible waste of money.

What will happen to Rhoose Airport? At a time of soaring domestic and commercial rates, will the ratepayers of Glamorgan continue to bear the crushing and unfair burden of servicing the charges for their airport. I hope that the Minister will be able to give a satisfactory answer to this point.

The people of Cardiff have experienced some enormous disappointments in the past year. For instance, there was the failure of British Rail to establish its western headquarters. Can the Minister give an assurance when, and if, the announced move of defence and other Civil Service staff to Cardiff will take place? There have been some extremely unsettling and disturbing reports on this matter, and they have not been aided by racialist statements by the Plaid Cymru representative in my own division. However, I doubt whether that will deter anyone.

We should also be on our guard, as the hon. Member for Caerphilly warned, against a set of proposals which the Government are to introduce soon. I am obviously referring to devolution. We are of the opinion that the Secretary of State is one of the few Government Ministers who is deeply committed to a Welsh Assembly. When he wrote to his own constituents in February he described it as growing and developing as an instrument of government and spoke of its powers being shaped in the light of experience and democratic needs. That is rather grand language, but what does it mean? In my view it means that it is anticipated that a Welsh Assembly would continue to grow and accumulate power—and that is one of the real dangers.

Where does the Secretary of State envisage the eventual constitutional resting place for a Welsh Assembly? Precisely what is his Department doing when it asks the Cardiff City Council and the tenants of the Temple of Peace to scout around making arrangements for an undebated, unannounced and unknown Assembly? Indeed, I would call it an "unwanted" Assembly, because the Secretary of State has been told just how unwanted it is. That view was expressed by the Chairman of the Mid-Glamorgan County Council during an after-dinner speech, and he seemed to win the approval of his fellow councillors.

The Welsh Assembly is a detraction from the real needs and affairs of Wales.

Mr. Wigley rose

—

Mr. Grist

I shall not give way, because I do not have time. It is almost beyond belief that when jobs are increasingly in danger, inflation is rampant, the health, education and social services are visibly crumbling, and the country has to go on bended knees to our creditors, we should waste the time and money involved in this devolution argument. It will take up an enormous amount of time in the forthcoming parliamentary Session, and will involve all hon. Members who are present tonight. On my own behalf, I hope that it is a case of Whom God would destroy He first sends mad. I hope that the Secreary of State remembers what he demanded of any proposals for devolution when he launched last year's White Paper. Indeed, White Papers on this matter are getting a little thick on the ground. At that time, the Secretary of State laid down four main principles. The first was that the taking of powers from any central body should meet a genuine need. Unless he believes that the Welsh Office is hopelessly inefficient, I cannot see any need for an Assembly.

The second was that any proposals should be based on widespread public support. By now the Secretary of State must realise that he is crying in the wind if he wants to get widespread public support in Wales. He could always look at the recent poll in the Liverpool Daily Post. He could consider the survey of the Kilbrandon Commission and the experience of hon. and right hon. Welsh Members, all of whom could tell him that there is no public demand for this wretched Assembly.

The third principle was that any changes should mark a clear and definite improvement. We shall all wait for proof that there will be a clear and definite improvement. I, for one, think that the Secretary of State and those who think like him will be rather hard pressed to prove anything of the kind. Fourthly, the Secretary of State said that any changes must be designed to provide a stable constitutional framework for the future. We have just reformed local government in Wales. Apparently, we shall have to uproot it if we have an Assembly. Is that providing a stable constitutional framework? I do not believe that it is.

We know from what the hon. Member for Carmarthen (Mr. Evans) has said in the past just how stable he views any Welsh Assembly. It would just be used as a spring-board for further advances and demands. Unless the Assembly had power to raise money for and to grant money to industry, every setback, and every failure to provide new jobs and employment, would be blamed on the tight-fistedness of this place. Inexorably, the power would have to be handed over little by little, more and more, faster and faster. The aim of people such as the Communist Party and Plaid Cymru is that, with an elected assembly—preferably a legislative assembly—the break-up of the United Kingdom will follow, as surely as night follows day.

I believe that we shall have a long time to look at this proposal, but it ought to be stated that in the Chamber at the moment there would be a clear majority against an elected Welsh Assembly.

It is clear that parliamentary time will be taken up fruitlessly debating something which may tear our country apart. It is sad, and it is certainly unnecessary. I hope that when the matter reaches the Floor of the House there will, so to speak, be hands across the Chamber in the service of the United Kingdom.