HC Deb 06 August 1976 vol 916 cc2295-312

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

11.8 a.m.

Mr. William Hamilton (Fife, Central)

It was with mixed feelings that I was notified of the opportunity to raise this first subject for debate today. I had mixed feelings because I would rather that the need to raise the matter did not exist. I believe that this is a problem which is troubling the people of Scotland, and, I suspect, of every other part of the United Kingdom, more than any other problem facing us. I do not believe that they are troubled as much about the machinery of government or the possibility of the establishment of new and separate Assemblies in Wales and in Scotland. Still less do I believe that they are troubled about the need for a separate Scottish foreign policy —whatever that means—and a separate Scottish navy, army and air force. I think that the House would prefer to leave all that irrelevant nonsense to the Members of the Scottish National Party.

Frankly, I shudder to think that, while we should be quite properly concerned with unemployment, inflation and the rest, the greater part of next Session of Parliament will be engaged in discussing devolution—the imposition on the people of Wales and Scotland, and perhaps Northern Ireland, of a further tier of government and the bureaucracy that goes with it. I suppose that the only argument that one could adduce for it is that one might create sufficient additional bureaucrats to get rid of the dole queues. It would not do much for the wealth of the country, and it is on that that our future well-being depends.

The Government and their supporters are concerned to tackle inflation and the effects of the world-wide recession which have brought in their wake a rising tide of unemployment throughout the Western world. Anyone who has listened to Euro- pean politicians, as I have, knows that they have exactly the same problems as we have. This is not a peculiarly United Kingdom problem or a peculiarly British disease. Contrary to what some of my hon. Friends have been saying in recent weeks and months, there are no easy options open to the Government. There is no quick and painless solution to this problem. Nor can we sloganise or nationalise our way out of the difficulties.

Having put the matter in a world context, I hope that I shall not be accused of being too parochial by focusing attention on the problem of unemployment as it affects my constituency, and in particular one part of it, namely, the Cowdenbeath-Lochgelly area.

I should like at this point to make another generalisation. A lot of compassion has been shown about the question of unemployment among school leavers and the young. It is absolutely right that that should be so, and it is inevitable in any civilised society. But the tragedy for men and women who suddenly find themselves out of work at 40, 45 or 50 years of age is just as despairing as it is for the youngster who on leaving school finds himself on the scrap-heap. Nothing can be more soul-destroying or more degrading than to feel unwanted by society at the tender age of 16 or 20, or even at the age of 45 or 50. It is a small step from the dole queue to vandalism, anti-social behaviour or perhaps alcoholism, and certainly deep resentment which might expose itself in the form of crime.

We on this side of the House and the Government do not need to be reminded of these matters. Some of us are old enough to have lived through much worse, and we have friends who suffered not months but years of being on society's scrap-heap. I still have at home a pamphlet written in 1936 about the problems of the North-East of England, my native heath. In it there is a long list of villages and communities where unemployment rates were not 6, 7, 8 or even 10 per cent., but 80 or 90 per cent., and not over three months but over five, six, seven, eight or 10 years—men of 20, 30 or 40 years of age who had never worked since they left school. Those days will not be allowed to return. Today society, and certainly the working man, would not tolerate their return.

Statistics in a debate of this kind are dry, inhuman things which do little to tell us about the misery which lies behind them. Nevertheless, they must be used if only to put the problem into perspective. I wish to refer—I hope in not too much detail—to the Department of EmploymentGazette for July. On pages 772 and 773 of that official document there are tables showing the unemployment rates in special development areas and other areas throughout the United Kingdom which receive special treatment because they have special employment problems. In Scotland 20 such areas are listed. According to the list, on 10th June—the latest date for which figures are available—the unemployment percentage among males and females in those 20 areas varied from 2.5 in Aberdeen to 9.6 in Irvine.

I was interested to discover that Irvine's percentage unemployment rate was even higher than that of more remote parts of Scotland. May I say in passing that, as Aberdeen is a highly prosperous area, I see no reason why it should have development area status. The time has come to consider the designation of the whole of Scotland as a development area and, in view of North Sea oil developments and the spin-off which plainly is having a salutary effect in certain parts of Scotland, to be a bit more selective.

According to the figures in theGazette, in the Dunfermline area, part of which I represent, the unemployment rate is 6.2 per cent. In other words, six out of every 100 males and females are out of work. In Kirkcaldy, which also falls partly within my area, the rate is higher at 7 per cent.

Those general figures conceal greater localised problems. The Cowdenbeath-Lochgelly area—the centre of my constituency—forms part of the Dunfermline travel-to-work area, and there the percentage rates of unemployment are much higher. The Fife Regional Council Careers Service supplies me with monthly figures for each area in the region, and I am am deeply grateful to it for them. According to the figures supplied for 7th June 1976—I should emphasise that this is the careers service-95 young people were unemployed in Cowdenbeath and 143 were unememployed in Dunfermline. The total figure for Fife was 650, but in June 1975 it was 489. It is getting worse. It has gone up from 489 to 650 in the last 12 months. School leavers are included in these figures.

In June 1975 the number of unemployed school leavers in Cowdenbeath was 43 and in June 1976 it was 55. What the figure will be as a result of those who have recently left school I do not know. In the Dunfermline area, in June 1975 the figure for school leavers was 49. In June 1976 it had more than doubled to 104. Comparable figures for the whole of Fife show a similar increase, from 186 in June 1975 to 376 in June 1976.

The total unemployment figures in the Dunfermline district peaked in January this year at 3,654 and in June this year they were down to 3,100. This seems satisfactory, but one would expect this reduction as we move from the winter months to the summer months. The number is still much higher than the 2,238 of June 1975.

Fife Regional Council produced a report which gave the figures—which are fairly well known—of the number of employees at the Rosyth Naval Dockyard. It states in paragraph 6.18: Rosyth Naval Dockyard employs around 8,000 civilians and is of major significance. I think I am right in saying that it is the biggest single employer in Fife. The report goes on to say: The future of all four Royal Naval Dockyards is under review by the Ministry of Defence; in correspondence in connection with the Regional Report it has been stated that the Ministry is aware of the economic significance of the dockyard to Fife and that there are no plans at present for its closure. We now have two proposals in front of us which disturb me and the people on the spot. The first proposal is from certain hon. Members in my own party who are demanding massive and immediate cuts in defence expenditure. My right hon. Friend the Secretary of State for Defence said that if that is the policy that the party wants—these are not his exact words; I am paraphrasing—and it is to be pursued and made effective, it is inevitable that there will be considerable consequences on employment. I think it would be inevitable that one, if not more, of the four dockyards would have to be closed. I would resist to the death any closure of Rosyth Dockyard, because if it were closed it would be nothing short of a catastrophe.

The other proposition which worries me— I suppose it should not, but it does —is that the Scottish National Party has come out in favour of a separate Scottish navy and against the establishment of Polaris nuclear submarine bases in Scotland. The party has not said whether it would prefer the bases to be moved to England. What the morality of that is, I do not know; that is for the SNP to defend.

The Rosyth Dockyard services the nuclear submarines which form part of the North Atlantic defence force. The SNP has admitted that if it were ever to gain control of our destinies in Scotland and removed the nuclear bases, the 8,000 jobs at Rosyth, even supposing that the dockyard were kept open for Scotland's little navy, would go down to 1,500.

I want my hon. Friend the Minister to give me an assurance that the Scottish Office will tell the Ministry of Defence that we are resisting and will go on resisting the closure of Rosyth Dockyard or a reduction of the labour force there, because it makes an invaluable contribution not only to employment in Fife but to the NATO Alliance.

I return to the Cowdenbeath-Lochgelly area, from which a lot of workers at Rosyth Dockyard are drawn. I am told that the male unemployment rate in that area is currently about 15 to 16 per cent. Very nearly two out of every five males in the area are out of work. I rang up the Cowdenbeath Employment Exchange only yesterday and got the latest figures, but I do not need to put them on the record as they will be available locally and, no doubt, in the Department. Whatever the precise figures, they are unacceptably high.

I note that the Government have recently announced that they are to take certain measures to alleviate the problem. It is certainly much too early to judge the effect of the most recent proposals, which are not yet operative. However, there are results and some of them are superficially touching the problem. There is some justification for the charge that all the measures, including those announced by my right hon. Friend the Secretary of State for Employment this week, are short-term, palliative and cosmetic measures which are not getting, will not get and are not intended to get to the root of the problem. They are first-aid measures until we get the patient into hospital and properly cured. The real solution is, and can only be, an upturn in the economy, the end of the world recession, an increase in investment, increased training facilities and the like.

I was disturbed, as I am sure the Minister was, to note that, despite what the Prime Minister said a day or two ago about the optimistic forecasts of future investment by the CBI, the Scottish section of the CBI was less optimistic. There could be good and valid reasons why the Scottish section of the CBI should be less optimistic than the English CBI. Will my hon. Friend comment upon that? He was good enough to agree to meet my hon. Friend the Member for Dunfermline (Mr. Hunter) and myself on 21st July to discuss those problems. My hon. Friend the Member for Dunfermline is not present; he obviously has other engagements. Many hon. Members obviously have other engagements. Perhaps they are already enjoying their holidays prematurely in Spain—including the hon. Member for Aberdeen, South (Mr. Sproat). But let that pass.

At that meeting we put forward certain proposals. We suggested that this part of my constituency should be given special development area status, which, as my hon. Friend knows, would mean that it would receive special financial aids of one kind and another to encourage industry to go there. We suggested that there should be a priming of the pump by help from the Scottish Development Agency, a new body set up by the present Government. We suggested also that the Department should study the Fife Regional Report, to which I have already referred.

I was informed by my hon. Friend a few days ago that the Secretary of State for Industry was considering the first point, namely, special development area status, but I received a disappointing reply from him dated 5th August—that is, just in the past 24 hours—saying that the Department of Industry rejected the proposal that we should have special development area status. I shall not read the letter in full, but here is the relevant paragraph defending that decision: The rates of unemployment in Scotland and the West Central Scotland Special Development area are significantly higher, and in the case of West Central Scotland the problem of higher than average unemployment has, as I know you will be aware, persisted over a very long time. It is this kind of problem that the Government's regional policies are aimed at solving, and while West Fife's difficulties are recognised through its designation as a development area, I think you would accept that these do not approach the difficulties faced by West Central Scotland in terms of duration, severity and scale. The letter goes on, but that is the relevant passage. There are other parts of Scotland which are worse off, but, as I pointed out earlier, there are other areas which are much better off—in this connection I specifically mentioned Aberdeen —which seems to me to emphasise the need for the Department of Industry to have another look at the whole of Scotland to see whether we can be more selective within Scotland with development aid and our regional policies, consequent on North Sea oil developments.

As regards the role of the Scottish Development Agency, I am glad that my hon. Friend wrote immediately to Sir William Gray and that he was kind enough to send me a copy of the letter that he sent to Sir William. That, together with the fact that Sir George Sharp, the Convener of the Fife Regional Council, is a member of the agency, should ensure that the urgent needs of Fife are not forgotten. I should say, again in parenthesis, that an announcement has been made by the Government recently that more finance is to be available to the National Enterprise Board in England and the Scottish Development Agency in Scotland, but no figures have been given. I do not know whether the Government intend to announce these figures during the recess or whether we shall have to wait until afterwards, but it is of crucial importance that the decision be made as early as possible, because help is urgently needed in areas that I represent.

In the regional report, which was produced in May of this year, there is an interesting section dealing with trends in the total work force in the region as a whole. Between 1952 and 1957 the total work force went up by 4,000, from 114,000 to 118,000. It subsequently fell, reaching a figure of 113,000 in 1961, and then rose, reaching 126,000 in 1974. We are slightly up from the 1957 figure, but the interesting fact is that in the period 1961–74 male employment in Fife Region declined by 9 per cent. while female employment rose by 44 per cent.

The reasons for that are obvious. Fife was, as my hon. Friend well knows, predominantly a coal mining area. The coal mines were closed—I think, with hindsight now, probably prematurely—and we immediately set in motion machinery for bringing in new light industry. That new light industry, however, does not employ the men who lost their jobs when the pits closed; it employs women, who, the employers say, have a manual dexterity which the men do not have. I think that the real reason is that female labour is a damned sight cheaper than male labour, and we are seeking to bring that to an end by our equal pay legislation. The Government are trying to make sure that every employer—and, I may say, every trade union as well—obeys the letter and spirit of the equal pay legislation.

There is some evidence still that a few employers even in Fife are seeking to evade their responsibilities in this matter, by new job evaluations and the rest, and I believe that the Government should be much more firm, through spot checks on employers in Fife and elsewhere, to see that they are obeying the law on equal pay.

I have mentioned the decline in coal mining. Between 1958 and 1972 we lost in Fife alone 17,000 jobs in deep coal mining. In 1954 one in every five male workers in Fife was a coal miner. In 1974 it was down to one in 14, and the figure for deep mining is now stable at round about 7,500.

I shall give only a few more statistics. In the period 1964–74 there was an increase of 13,800—over 40 per cent.—in the number of manufacturing workers in Fife. It is worth emphasising, as the regional report does, that this was the largest increase in manufacturing workers in the whole of Scotland in that period. In Scotland as a whole there was a decline of 18 per cent. in jobs in manufacturing industry.

My hon. Friend is to visit Fife later this month, and I think that he will be impressed—I hope that he will be—by the diversification of industry that we have managed to achieve in Fife through the joint efforts of the new town development corporation, the local authorities, industry itself, and the Government, with their various regional aids. That has been one of the great success stories of the post-war era.

I now return to the main theme of the debate—the pockets of high unemployment. The averages tend to conceal the reality. A figure of 17.8 per cent. male unemployment is quoted in the regional report, which is already out of date. During our meeting my hon. Friend the Minister undertook to study the report and to give it the attention and care that it deserves. He said that he would report to us in due course.

In these times of financial stringency it it more important than ever to get our priorities right and to build for the future. To do that we must invest more in our young generation, not only in industry but within the education system and by means of vocational training. It is the easiest thing in the world to criticise Government policies, but I hope that the people of Scotland and elsewhere are aware of the alternatives. I shall put one or two of them on record, because they have never been spelt out in detail by the Opposition. They have made general statements about the need to decrease public expenditure still further on hospital and house building, and the rest, but they have never done so with precision.

In the debate on the public expenditure cuts on 7th August, however, a former Conservative Minister, the hon. Member for Honiton (Mr. Emery), was specific about what the Conservatives would do—or what they should do—if they were returned to power at the next election. The hon. Member for Honiton let the cat out of the bag with a vengeance. He proposed an immediate 5 per cent. cut across the board in social security expenditure. In other words, he proposed, in effect, that £500 million should be taken out of the pockets of the old, the sick and the disabled—the most helpless in our community, who are the very people that a civilised Government should protect, whatever they do to other people.

The hon. Gentleman's second proposition was that there should be a 15 per cent. cut in unemployment pay. Let him tell that to the 1,250,000 people who are now on the dole. They would face a 15 per cent. cut and would have no recourse to supplementary benefits, because the hon. Gentleman wants an across-the-board reduction in expenditure.

The hon. Member's third proposition was the abolition of the school meals service, which would save another £301 million. He said that all school meals should be paid for at their full economic cost by parents.

Fourthly, the hon. Member said that there should be a 25 per cent. cut in housing subsidies, which would save £331 million. So, the worker in Scotland who is taking home £20 or £30 a week would have to pay for school meals, his rent would go up when the subsidies were reduced, and if he happened to be on the dole he would also face reduced unemployment benefit.

Fifthly, the hon. Member advocated a 10 per cent. cut in National Health Service finances. If the worker to whom I have referred had to go into hospital he would find that waiting lists had lengthened and that the facilities, which are already stretched to an intolerable degree, had declined even further.

Sixthly, the hon. Member, not unnaturally since he was a director of an oil company, suggested that we should get rid of the British National Oil Corporation and hand back to the oil companies all profits from North Sea oil Linked to that was his seventh proposition —that there should be a reduction of £357 million in corporation tax paid by firms out of their profits.

That type of policy is a recipe for increasing unemployment to the dimensions of the 1930s. It is a recipe for revolution, because the workers and trade unions simply would not stand for it.

At the next election, whenever it comes, the Government will be judged on the question not whether they have provided an Assembly in Edinburgh but whether they have provided jobs in Cowdenbeath, Lochgelly, and other parts of the United Kingdom which are now bearing the main burdens of the present crisis. The acid test will not be on the creation of another costly tier of governmental democracy; it will be on the Government's ability to provide job security and to bring inflation under control.

The Government dare not fail to meet those challenges. I hope that my hon. Friend will use the influence which I know he has with the present Prime Minister to drive that message home. Instead of wasting the next Session on the machinery of government we should use our energy, resources and ingenuity to tackle the economic problems on which we shall be judged when we go to the people.

11.49 a.m.

The Minister of State, Scottish Office (Mr. Gregor MacKenzie)

My hon. Friend the Member for Fife, Central (Mr. Hamilton) has put his case fairly. sincerely and without exaggeration. I am sure that the people of Fife will appreciate the comments that he has made this morning. I have already discussed the problems with him and with my hon. Friend the Member for Dunfermline (Mr. Hunter) and I know how anxious they are about unemployment in Fife in particular and in Scotland in general.

The Government wish to reduce unemployment as quickly as possible. My hon. Friend rightly said that this is a world-wide problem. The recession is a bad one and we cannot look at the situation in isolation. I know my hon. Friend understands that, and I know that he, like myself, hates the thought of unemployment being as high as it is in Scotland at present. We hate it not just because we look at the figures and the percentages but because we both come from families in which we have bitter personal experience of unemployment in the 1920s and 1930s.

That is why we are anxious to get unemployment down as quickly as we can and why we resent the sort of comments we have heard over the past few days about unemployed people being scroungers and so on. My hon. Friend and have people in our own families who are unemployed, decent working people who are genuinely trying to find a job. They are not sunning themselves on the Costa Brava, the Costa del Sol or elsewhere. The people of Scotland want work, and we are determined to do everything we can to ensure that they have it. I shall deal with some of the actions the Government have been taking.

Last week in the Scottish Grand Committee we discussed the whole problem of unemployment in Scotland. I know how disappointed my hon. Friend was that he did not manage to speak in that debate. I know how hard he tried, but we all sometimes have the frustrating experience of trying to make a speech in the Scottish Grand Committee and finding that time does not permit.

I spelt out then the economic difficulties we have faced over the past two years, with an adverse balance of payments, inflation and the need to restrain public expenditure. The balance of payments position has improved, although more needs to be done. With the full cooperation of the trade unions we have seen the level of inflation fall, and we look forward to this trend continuing. My right hon. Friend the Chancellor of the Exchequer recently dealt with the problems of public expenditure. While we all regret the necessity of any cuts in public expenditure, my hon. Friend was right to point out the effect of having a Conservative Government and how much more serious the cuts would be if the advice of such people as the Leader of the Opposition were accepted. It would be serious in employment terms for the people of Scotland.

The object of our strategy is to ensure that we divert our limited resources into manufacturing industry. By such measures in the longer term we shall establish an economic climate which will bring better and lasting opportunities to areas such as Fife. I am aware that unemployment in many areas is a serious problem. We have taken a series of short-term measures, most recently those announced on Tuesday by my right hon. Friend the Secretary of State for Employment, to alleviate unemployment to some extent. Those measures, such as the temporary employment subsidy, the recruitment subsidy for school leavers and the job creation scheme, have already resulted in over 2,000 jobs in Fife being created or protected. Indeed, I am told that Fife has been one of the leaders in Scotland in increasing employment through the job creation programme. I hope that the new work experience scheme announced on Tuesday will also prove useful to the people of Fife.

We do not pretend that these measures are the full answers to our difficulties, but they show our determination to take such steps as we can afford to relieve unemployment. The measures are properly directed towards helping to deal with the problem of unemployment among young people. My hon. Friend mentioned the tragedy of youth unemployment, which leads to great frustration and difficulty. I am sure that the House will do all it can to ensure that young people are given a start in life and that the training opportunities which my hon. Friend mentioned are taken up by the youngsters.

My hon. Friend also mentioned the problem of Fife and the reduction of employment in our traditional industries, whether in coal mining or similar industries. I am very conscious of this, too, as I represent a constituency which was based on coal and heavy engineering. It is a tragedy that many men who have given a lifetime of service to those industries now find difficulty in obtaining new employment. That is why we have been anxious to create new employment opportunities and why we have used regional policy as one of our main weapons.

Although unemployment is high, regional policy has had two effects for the people of Scotland. These are that the gap in wages between Scotland and England is now much narrower than it was when I entered the House early in 1964 and that the gap in employment opportunities is also much narrower. That is why it is important that we should continue with a useful regional policy, and why I am sometimes saddened that a separatist attitude on employment is adopted by Scottish National Party Members—I was about to say "by those on the Scottish National Party Bench", but they are not here to contribute to our debate. We can have an effective regional policy only if the industrial and economic integrity of the United Kingdom is preserved.

We in the Scottish Office offer advice and encouragement to industry to set up in Scotland. We have an office in Glasgow which offers selective financial assistance to projects which will create new employment or safeguard existing jobs. The full range of other forms of Government assistance to industry is available—the regional employment premium, regional development grants, assistance under the industry modernisation schemes and the accelerated projects scheme. The problem is the absence of new projects at present, but under the Industry Act 1972 13 offers of selective financial assistance have been made to projects in the Cowdenbeath, Dunfermline and Inverkeithing areas involving about 1,400 jobs and a total investment of over £5 million.

There are some encouraging new projects in the area, such as the opencast developments at Westerton and the extension at Westfield, which together are expected to provide 100 new jobs. I am also aware—my hon. Friends will appreciate that I cannot give further details now, but I promise to do so as soon as possible—of plans by various companies which, if they materialise, will bring a substantial number of new jobs to the area. The picture is not entirely gloomy, because we see light at the end of the tunnel. The emphasis of the Government's regional policy on an area such as Fife should ensure that as the economy recovers the region is well placed to benefit.

My hon. Friend mentioned the subject of the Fife regional reports, which I have studied and which I regard as valuable. We shall be responding to those reports in the course of time. They suggested that it was important to attract companies from outside the area to provide jobs for our people. It is important that we should pursue that suggestion, and, indeed, that we should attract companies to come to Scotland not only from south of the border but from the Americas and from Scandinavia.

Scotland has a good record of attracting inward investment of that kind. Because of that factor, many people in Scotland are employed today in some of the newer types of industry providing good skilled jobs. That is a record which we are determined to maintain. Therefore, it is in our best interests as a country to continue to work with our partners and friends in other parts of the world and to encourage them to come to Scotland. Scotland possesses skilled and able young people, and I am sure that companies will take advantage of that talent.

My hon. Friend the Member for Fife, Central has always taken an interest in European affairs and he will agree that we must seek to attract industry from Europe. Once we have built up our connections, we can more easily attract such companies to provide jobs for our people.

It is worth mentioning in that respect that we obtain considerable benefits from the European Community's Regional Development Fund and Social Fund as a result of our membership of the Community. A few days ago I was privileged to be with Mr. George Thomson, the United Kingdom Commissioner, who handed over some valuable cheques which will help Scotland to cope with its problems. We have also received loans from the European Investment Bank for the regeneration of Scottish industry. That again is an important aspect of such contacts.

Many people who want to invest in Scotland are worried about Scotland's future in a political sense. In my last Government post at the Department of Industry I was privileged to act as a coordinating Minister for a group of high-powered American business men who came to the United Kingdom to examine investment prospects. They possessed a great deal of good will towards Scotland and other parts of the United Kingdom but expressed fears about Scot-land's future. They were worried that if we were to have a separate Scottish Parliament and all that goes with it they might not wish to continue to show the same interest as they had expressed over the years.

I reject—and I know that my hon. Friend shares this view—the inward-looking attitude of some of the people in Scotland, particularly those who represent the interests of the SNP. They believe that all our problems can be solved simply by the exploitation of oil or the production of whisky. We are thinking of a much broader attitude, and it is our hope that we can encourage industry to come into our country and provide jobs.

My hon. Friend also mentioned the problems at Rosyth, and I know that my hon. Friend the Member for Dunfermline has also shown considerable interest on this front. I can repeat the assurances given by my colleagues in the Defence Ministry that the Government have no plans to close the dockyard at Rosyth. We expect that yard to continue to be a major employer in the area.

My hon. Friend the Member for Fife, Central said that he was worried about the recent comments in the Scottish Press about defence, particularly about whether Scotland should have a separate army, navy and air force. When I heard that that idea was being put forward, I thought that somebody was pulling my leg. To me, the suggestion was quite ridiculous. When I saw such comments set out in a letter by the hon. Member for Moray and Nairn (Mrs. Ewing), I became particularly concerned. If such a suggestion were implemented, it would undoubtedly have serious effects on employment in Rosyth.

My hon. Friend the Member for West Lothian (Mr. Dalyell) properly drew attention to this subject in the House the other day. My right hon. Friend the Minister of State for Defence said: the naval dockyard at Rosyth concentrates on refitting the Polaris submarines, which I understand the nationalists are determined to evict from Scottish waters, and also the expensive nuclear-powered hunter-killer submarines which could play little or no part in a separate Scottish navy."—[Official Report, 27th July 1976; Vol. 916, c. 593–4.] Those who make comments about getting rid of some of our defence capabilities obviously have not paid regard to the enormous employment consequences in areas such as Rosyth. We must aim at a balance in these matters. If there were to be a Scottish navy, it would affect the situation at Rosyth Dockyard and also the research establishments at Dunfermline and other important work carried out elsewhere in Scotland by companies such as Yarrow. There would obviously be fewer employment opportunities. The people of Scotland should take full note of that attitude, because those who put forward such views should take the situation more seriously.

My hon. Friend also mentioned special development area status. He mentioned a letter written by the Department of Industry. I wish to make a few general points to the effect that these matters are constantly monitored. We make changes in the boundaries from time to time. We look at the employment prospects and at the industrial structure of the areas, and when required to make changes. But I want to make the more general point that our problem at the moment is not just in designating an area as a special development area, a development area or an intermediate area but in finding the right kind of growth projects which we can assist in going to those areas.

My hon. Friend also mentioned my letter to Sir William Gray and to his chief executive about possible action by the Scottish Development Agency in the case of Fife. The agency is a very powerful organisation. It will play a very important part in the regeneration of industry in Scotland and' in improving the environment. It is worth saying for the record that if the Opposition had had their way there would not have been any Scottish Development Agency at all and we should have been bereft of its services. It was important to set it up because there are a number of Scottish industrialists who have a very poor record in investment, and the agency can play an important part in Scotland's future.

As my hon. Friend knows, I do not take an active part in the running of the agency, and I would not seek to interfere in its day-to-day management. I have, however, brought the problems of Fife to the attention of its chairman, and I am sure that he will pay due regard not only to my letter but to my hon. Friend's comments this morning. The creation and maintenance of employment is of course one of the agency's main functions and I am confident that the agency will give priority, in developing its industrial strategy, to areas like Cowdenbeath and Lochgelly where disproportionately high numbers are out of work.

The agency already has a significant number of factories in Fife. Work is to start on a new factory at Kirkcaldy in the near future, and the agency will, of course, keep under consideration the scope for further advance factory building in West Fife. The agency has approved seven schemes for derelict land clearance and environmental improvement in Fife at a cost of about £700,000. The agency is therefore closely involved in the area, and the chairman has visited Fife. This will be important for the future.

I think, too, that the additional finance which will be made available to the agency and to the National Enterprise Board will be of considerable assistance. After all, we have the example of Leyland. A spin-off from that is that there are jobs for workers in places like Fife. We shall be making announcements about that in due course.

I should inform my hon. Friend and the House that the Manpower Services Commission has accepted, as part of the job creation programme, a scheme drawn up by Fife Regional Council for the first phase of the development of Lochore Meadows Country Park. The scheme, which is estimated to cost about £200,000, is also being supported by the Scottish Development Agency. It will involve the provision of a proper access road, car-parking facilities and the first stage of an integrated building complex comprising changing rooms, equipment storage areas and so on. It will create valuable jobs almost immediately and will add significantly to the amenity value of a very important rehabilitation project on which substantial public resources have already been spent.

The long-term solution for Fife lies, as I have said, in our regional policies and in the strengthening of our national economy. We are determined to see our economic strategy succeed. I join my hon. Friend in trusting that Fife will get its fair share of the new opportunities that will develop.