HC Deb 18 November 1976 vol 919 cc1687-714

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

9.8 p.m.

Mr. Michael McGuire (Ince)

I am indeed pleased that through good fortune—[Interruption.]

Mr. Deputy Speaker (Mr. Oscar Murton)

Order. Will right hon. and hon. Members who do not wish to hear the hon. Gentleman in his Adjournment debate kindly leave the Chamber quietly?

Mr. McGuire

Due to good fortune, we have one hour and 20 minutes in which to debate this matter instead of the traditional half an hour. You will remember, Mr. Deputy Speaker, that on the last occasion I lost this debate due to a procedural device. That was a fortnight ago. Tonight I know that some of my hon. Friends will also wish to speak in the debate.

The announcement on 27th October that Courtaulds intended to close its Skelmersdale factory, which employs 1,000 people, came as a complete shock to the people of the new town. It came as a shock because, when the Prime Minister visited Skelmersdale on 3rd September, he met not only me but local members of the Labour Party. We put to him the suggestion that the Government should help to reduce our already too high unemployment rate in Skelmersdale and our fear about some of the firms in the textile industry, particularly Courtaulds.

It is not just Courtaulds, which employs 1,000 people, which is affected. There are also the gravest problems in the constituency of my hon. Friend the Member for Flint, East (Mr. Jones), which also suffers from the threat of steel unemployment.

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

Yes, indeed.

Mr. McGuire

The reason given to me for the closure of one of the factories in my hon. Friend's constituency is that the market for tights had gone. Harwood Hosiery in Skelmersdale, which employs about 600 people, also manufactures tights, so I have fears about that factory as well. But what I am discussing is the proposed closure of Courtaulds.

We explained to the Prime Minister our fears about the delicate imbalance in the town and above all in the textile industry. The Prime Minister has unwittingly been drawn into this. He wrote me a letter following his visit in which he assured me that he had made inquiries, presumably of Courtaulds—presumably someone checked it out—and he was pleased to be able to tell me, and I told my constituents, that there was no fear, certainly in the immediate future, of the Skelmersdale factory closing.

I made inquiries when I heard on the bush telegraph of an announcement to be made on Friday 22nd October about the closure of Courtaulds factories in Northern Ireland and other parts of the country, particularly Hint. When I was told that the Skelmersdale factory would not be on that list I was reassured. I thought that the Prime Minister had really checked it out and the information was solid. I was sorry for anyone who would lose his job, but I felt a little easier about the factory in my own constituency.

Hon. Members can imagine how I felt when, only six or seven weeks after the Prime Minister's visit, this announcement was made. It was a bombshell, because this area had earlier suffered its cruellest blow so far, with the closure of the Thorn colour tube factory, which had employed about 1,400 people. This proposal, on top of that, makes nonsense of our claim that new towns are somewhere where the best things in life will happen, with the key being planned employment. It makes our regional policy laughable.

The statistics for Skelmersdale can be misleading. People may therefore think that I am over-egging the pudding when I quote our statistics of unemployment. The official statistic is about 13 per cent, unemployment. That is horrific, but is considered not too bad for Merseyside—although it is well above the national average. But it is diluted. We are in the Ormskirk-Skelmersdale travel-to-work area. I can prove how false these figures are.

The total insured population—men, women, boys and girls—in the two towns is roughly 31,000. According to an official survey of last June, the total insured population of Skelmersdale New Town is 16,000.

National statistics show that 37 out of every 100 workers are women. In Skelmersdale there are about 16,000 workers and potential workers. About 10,000 of them are men, and approximately 6,000 are women. There are 1,616 men, 194 boys, 549 women and 140 girls who are unemployed. That is a total of nearly 2,500, about 15 per cent, of the working population. If Courtaulds close—I stress " if ", because it is my job and that of the Government to stop that from happening—about 500 men out of the 1,000 employed there will be added to the list of the unemployed. That will give a total of 2,116 out of the 10,000 male employable population and this will give us a male unemployment rate of 21.2 per cent. My figures are incontrovertible. I use them because the official figures do not represent the true picture.

I am pleased to see that both the Under-Secretary and the Secretary of State for Employment are in the Chamber. It shows the importance that is attached to the debate. Travel-to-work figures should not be used. The true figures for Skelmersdale are diluted because Ormskirk, with a 15,000 insured population, has only 758 unemployed. It is because of that figure that the true situation in Skelmersdale is not revealed. That is dangerous, because it stops Governments from spotlighting the problem.

My purpose in raising this subject is to try to prevent the closure, which will affect my constituency so badly. I want to hear the Minister tell the House tonight that he will institute an inquiry into Courtaulds' affairs, and I hope that hon. Members will forgive me if I am particularly anxious about Courtaulds, Skelmersdale. They will appreciate that not all the factories are the same. The Flint factory, and others, did not receive the Government grants that enabled Courtaulds, Skelmersdale, to start. It is not, therefore, on all fours with the other factories.

There are many reasons for an inquiry. First, we must allay the disquiet about the many millions of pounds of Government money which has been given to the company legitimately. It is Government policy to encourage firms to go to special development areas. But I do not want to see companies receiving huge sums and then, if they make a loss, heading out towards pastures new with other Government grants with which to set up other factories employing fewer people. One of the features of British industrial life is that the more one invests the fewer jobs are provided, and that is a problem which our Labour Government have got to deal with.

The company was legitimately given huge amounts of public money and now it says " We are very sorry. We shall stay for 90 days more, then we are leaving." Incidentally, Courtauld considers the 90 days to be the consultation period. Thorn got away with giving notice and heading out after a couple of weeks, because the Labour Party's Employment Protection Act did not apply. The people of Skelmersdale are at least grateful for that Act. Without it the company could have legged it out and we should have had all the problems of people not receiving any wages, apart from redundancy pay, after a few weeks.

What Courtaulds has said about the consultation period does not show enlightened management. It says that it has carried out a great deal of consultation about the factory and has come to the end of its tether. To think that the 90 days constitute the consultation period shows an abysmal understanding of sound industrial relations policy. There is enough public disquiet for the Government to say "We must have a public inquiry".

Apart from the public disquiet, which I have referred to, there are three reasons why I would like an inquiry into the company's statement of why it intends to close what, after all, was in 1968 the most modern textile factory in Europe. After only eight years there is talk of closing it. The first strand of that statement is about losses. Sir Arthur Knight has said that the company had made continuing losses in Skelmersdale. The figure of about £6 million has been mentioned. The second strand was about the import problem.

The company has faced, and still faces, tremendous import penetration problems. Some of my hon. Friends wish to develop that theme, and I shall not steal their thunder. The lightweight polyester fibre manufactured at the factory is used mainly for shirts and lingerie. Courtaulds has said that import penetration in the fibre has gone from 40 per cent, to 60 per cent, almost in the twinkling of an eye. It might be possible to prove at an inquiry that the Government could help keep the factory open with some form of aid or import controls. The price that Courtaulds could obtain was unrealistic, because of price control and probably because of the import competition.

Those are two factors I should like an inquiry to consider. The third is an allegation of bad industrial relations. As far as I know, this is the only factory to be closed that has been the subject of that kind of announcement. The company uses the euphemistic phrase "not being able to attain the manning levels we should have liked to make the factory efficient".

Union representatives taking part in the lobby yesterday begged me to secure the inquiry, because they were the only people to have been labelled in that way. They said that it put a question mark over their loyalty, honesty and work rate, and might irreparably damage the new town, so that employers would fight shy of going there. They told me " We have nothing to hide. We want a full inquiry. If we can concentrate on that, it will do us good." I hope that all hon. Members will give their full support to an inquiry for those very good reasons.

I hope that the inquiry will take place immediately. We have already seen 21 days slip by, and if it is to be thorough even the 90 days may not be sufficient. We are talking about 60-odd days because 21 days have already elapsed. It will probably take a few days to set up the inquiry, and I hope that there will be a guarantee that, if necessary, the 90 days will be extended so that the inquiry may be completed. After all, it may be the key to keeping the factory open. It would be nonsense for the 90 days to expire and for someone to say at the end of that period "We could have kept it open because we have found a solution"

The proposed closure calls into question the Government's new town strategy. The closure of Thorns and this proposed closure must mean that a question mark hangs over Harwoods, which I believe is a wholly-owned subsidiary of Courtaulds. It seems that the bottom has fallen out of the market, as two factories making tights have already closed. This background calls into question the fragile imbalance in Skelmersdale New Town—in other words, our industries are far too vulnerable.

I know that it is easy to speak with hindsight, but if about 1,800 jobs are put into textiles and about 1,800 into the television tube industry—that would have been the figure if Thorns had come to full fruition—with no import controls and a free and open market and it is attempted to build the prosperity of a new town on those industries, it is clear that the Government's strategy was either badly planned or not planned at all.

Skelmersdale is now faced with terrifying unemployment figures. I emphasise that it enjoys the highest form of grant aid that is available in Great Britain—namely, special development status. Apart from setting up the inquiry machinery as soon as possible within the 60-odd days that are left, I hope that the Government, when they decide to help us, will put in industries that will be able to survive the first sneeze of an economic cold. Skelmersdale's industry has not been able to do that so far.

At present, Skelmersdale is getting a great deal of publicity. I wish that I did not have to raise the town's problems, but I have only to mention Skelmersdale and the television crews are on the scene. However, when the town is mentioned on television, it is bad news. That seems to be inevitable. It is rather like the cartoonist's caricature of a Frenchman. He is always shown to be wearing a beret, a thin moustache, and a leering smile, while chasing a blonde. 1 hope that I am not hurting the susceptibilities of any French people.

The point I am making is that Skelmersdale news is bad news. Of course, the camera crews are always willing to be in the Merseyside area. They consider it a natural place for their presence, as the people are fairly loquacious, spontaneous and never stuck for a reply. It provides good television coverage, but that does not help Skelmersdale or Merseyside generally. I should prefer not to be raising this matter tonight, but if I were not it would be a dereliction of duty. When the Government bring industry to Skelmersdale, I hope that they will bring the sort that will stand the first sneeze and cough of any economic cold.

When the Government decided to rescue Leylands, I supported their decision. Recently, the Prime Minister said that if the company had not been rescued the West Midlands would have been a desert. We need a bit of help to stop Skelmersdale becoming a desert. After all, in a way it is our money that is involved. I hope that the Government will encourage by all means possible—I know that they are doing so behind the scenes—the introduction of a Leyland component factory. Skelmersdale is able to offer a suitable site. Indeed, there is everything in our favour. There are roads and an empty factory.

The people of Skelmersdale are demoralised. These events rocked them back. In previous Adjournment debates I have mentioned the plight of the new town. But all we get are kind answers and no action. We need to give these people a vote of confidence. It would take time, and it would not solve our unemployment problem, but it would help if we were to receive the news soon that the Government will give us one of the "Hardman" Government Departments. We have been badly treated in the North-West and shockingly treated in Skelmersdale. We are the biggest of the new towns, but we have not been given the smallest of Government offices. They are to meet a national need, and Skelmersdale is entitled to its share.

Let me turn now to devolution. Whatever plans the Government may have in that respect, we shall have the power and capacity to upset them if the North-West continues to get such a bad deal. Wales has a population of 2.75 million, and under the Government disposal programme it will get 660 jobs per 100,000 of population. In the North-West we should get all that we are entitled to, but already people behind the scenes are saying that we shall get too much, even though our figure will be only 150 per 100,000. We have been badly done by and we need a better share of that cake. I hope that we have an announcement soon.

We need an announcement to give hope to our bright young boys and girls and to give an element of economic stability and work for our unemployed building workers. Why can we not have an announcement for the advancement of the hospital? It should have been built, in any case. We are in a deprived area that has been short-changed over the years. That has been recognised by the historical deficiency grant which was recently awarded to the North-West Regional Health Authority.

Skelmersdale was to have been a planned oasis of employment, but now we are to lose the factories that we already have. There are no skillcentres or training facilities in the town. Few of the employers has taken on apprentices. Why cannot the Government encourage employers to do that to employ some of the young people who are out of work? Why can they not give us some of these centres? The jobcentre staff are doing their best, but we just do not have the basic facilities.

The Government's original strategy for Skelmersdale has left it extremely vulnerable. I believe that the Government's regional strategy is too blunt an instrument to help in cases such as Skelmersdale. The situation requires a sharper instrument. We do not complain that the Government's strategy did not work in earlier days. It has worked reasonably well. Areas which once had massive unemployment, however, have now got less than the North-West, which once used to have a neutral rate, just about the national average. But Merseyside suffers from huge pockets of unemployment. My hon. Friend the Member for Ormskirk (Mr. Kilroy-Silk) will confirm that in Kirkby and Aintree the figures are as bad as, if not worse than, in Skelmersdale.

Skelmersdale was planned. These towns or districts were unplanned. Therefore, the Government's duty to the people of Skelmersdale is more positive than it would be for an unplanned town, albeit with tremendous problems of unemployment. Because we have a blunt instrument of regional policy we are unable to direct resources and aid as quickly as we would wish to Skelmersdale, which would help it.

When the Skelmersdale New Town was designated in 1961, there were many comments about the efficaciousness of the proposal and whether it would succeed. There was the argument that if the Government had given aid to older established industrial towns it would have been better. With the benefit of hindsight, there is a lot in that argument. They could have done more for the people for whom help was intended—the people on Merseyside generally.

Merseyside has five new towns pulling the heart out of it. It is facing big problems now, with what is left behind. The costs are still great, and some of the people have gone. Nevertheless, Skelmersdale New Town went ahead in 1961.

Flowing from that and the Government's advertising, through the development corporation—I say this deliberately—people have been lured to the new town.

New towns are always expensive to live in. They are incredibly difficult to live in with the present unemployment figures. People had bright hopes when they went to Skelmersdale New Town. They were not expecting a new Jerusalem. Ordinary, intelligent people did not believe that they would never be out of work or that they would escape the harsh winds of the economic blizzards which blow from time to time, but they expected better and still expect better of a Labour Government. Their hopes have been cruelly dashed. They have already suffered too many harsh blows. Apart from the need for an inquiry, they want a vote of confidence by this Government. They are making a plea for help.

I am a Labour supporter and proud to be the Labour Member representing Skelmersdale. I often reflect whether it was a good idea for Skelmersdale to be added to the Ince constituency in 1950. Probably it was for my sins. But what we need now is help—and urgently.

I pay tribute to the fact that my right hon. Friend the Secretary of State for Employment is on the Front Bench today, along with several of his colleagues. I know that they have a desire to help. I want that desire to be expressed tonight in a concrete form so that the dark clouds over Skelmersdale will be lifted and people will say " The Government will help us. We shall have not only an inquiry but, with the help of the Government, will soon enjoy that better, richer life which lured us to the new town in the first place".

9.39 p.m.

Mr. Mike Noble (Rossendale)

I congratulate my hon. Friend the Member for Ince (Mr. McGuire) on a moving and able speech on behalf of his constituents. The points that he made tonight are very strong, and I know that the Minister of State, Department of Industry will take careful note of them.

I wish to deal specifically with the causes of the situation in Skelmersdale and in many other textile areas and perhaps the way out of that situation in future. Unless some dramatic changes are made in Government policy for the textile industry, we shall see other Skelmersdales and other closures of factories in the industry.

It is appropriate that we should be discussing this matter tonight after the Sexual Offences Bill, because we are discussing the rape of Skelmersdale by a textile company which has cynically manipulated public money for its own ends. For that reason alone there should be an inquiry into the affairs of Courtaulds.

I recall that when we fought the 1974 election the Labour Government were elected on the basis of accountability for the use of public funds. We met Sir Arthur Knight in this House not long ago. It appeared to me that, from a calculation of his figures, Courtaulds over the last three or four years has received £56 million in public funds in one form or another. In those circumstances it seems ridiculous for that company to define the word "consultation" as meaning taking a decision and then announcing it and at the same time saying that whatever consultation so-called takes place there will be no change in its opinions about the future of a number of mills which it had announced would be closed.

I fully support my hon. Friend the Member for Ince in his demand for an inquiry. My hon. Friend referred to the Early-Day Motion demanding an inquiry which has now been signed by about 150 hon. Members. I would remind the Minister of State that that demand is not simply as a result of disquiet outside. It is not simply as a result of disquiet in the trade union movement or in the Labour Party outside. Many hon. Members on this side of the House are extremely concerned that any company can receive the vast amounts of public money which have been poured into Courtaulds, it would seem without responsibility.

Along with my hon. Friends the Members for Ince, for Nelson and Colne (Mr. Hoyle) and for Burnley (Mr. Jones), I visited a new Courtaulds mill at Belmont in Durham. The management was proud to tell us that the mill had cost £12 million, of which £3 million had come from public funds, and that it would provide about 240 jobs.

When my hon. Friend the Member for Ince referred to the interests of investment I know that he was referring to the experience we had that day when we saw that magnificent mill costing £12 million—one quarter of which came from public funds—yet providing only about 200 jobs. There can be no justification whatever for not having an inquiry which the public, the trade unions and a vast number of hon. Members are demanding.

My second point relates to the reasons for this kind of situation developing. 1 know that the chairman of Courtaulds has said that the problem at Skelmersdale was not related to imports. I would say in reply that if we had not had the import problem the Skelmersdale situation would have been different and there would be fewer threats of closures in the textile industry as a whole. While I know that the Minister of State, Department of Industry, is not directly responsible for the trade side of the problem, I hope that he will take this message back to his colleagues in the Department of Trade. I can assure my hon. Friend that when he tells his colleagues what the problem is they will reply "Yes, we have heard it before". They have heard it from these Benches, and from people outside, on many occasions.

It is worth looking at some of the events of the last two years. We were repeatedly told by the Government that the textile situation was being dealt with, that the Multi-Fibre Arrangement would regulate trade in textiles and that this would create a secure home market and a secure situation for the British textile industry.

I liken the MFA Arrangement to a carefully constructed dam the top of which is three feet below the level of the water and as a result of which we have a continuous flood of imports. Let us consider cotton yarn from Portugal. In 1975, 5,800 tons came to Britain. Last year, despite controls, that had risen to 7,800. In 1974 we imported 63 million square metres of woven cloth from Pakistan. One year later, that had risen to 94 million square metres. The number of blouses from India has doubled in a year. In 1974 we took 2½million and in 1975 4½ million. The number of so-called handwoven blouses from India— which tests have shown not to be hand-woven—has increased tenfold in 12 months. In 1974 we took 27 million shirts from Hong Kong; last year we took 43 million. We took 15 million jerseys from Taiwan in 1974 and 18 million last year. We took 1½ million blouses from South Korea in 1974 and a year later 4 million.

Mr. Nicholas Winterton (Macclesfield)

Is the hon. Gentleman aware that last year we imported 19,000 shirts from the People's Republic of China and already this year the total is well over 420,000? The Government have not acted. This inevitably will affect the textile industrv. Will the hon. Gentleman press his hon. Friends to do something about it?

Mr. Noble

The hon. Gentleman has pressed the Government, and I associate myself with his remarks. It is hardly surprising that the trade gap in textiles is becoming increasingly unreal. In textile products we have a surplus which is rapidly going down. It was £101 million in 1971 and £15 million last year. The trade gap in clothing is disastrous. The deficit in 1971 was £48 million and last year it was £240 million. It is hardly surprising that Courtaulds in Skelmers dale and other areas, and many other textile mills, are facing such enormous problems.

It is essential that the Government should adopt a tough negotiating position when they renegotiate the Multi-Fibre Arrangement with their EEC partners and ultimately with the rest of the world. There are gaping holes in the Arrangement as it has been operating since its inception, not long ago. Thousands of our constituents, particularly in the North-West, have had their livelihoods put at risk or snatched away.

We believe that there should be a new Multi-Fibre Arrangement to replace the present one at the end of 1977. When I say "we" I am speaking not only on behalf of my hon. Friends but also on behalf of the trade unions in the industry, with whom my hon. Friends have remained in close consultation. We think that this is the best way to regulate the trade in textiles.

Some changes are needed. First, there is need for a recession clause. One of our biggest problems in the last 12 months has been that as the home market has dipped, imports have continued and have taken an ever-increasing share of the home market. There has, therefore, been a reduction in the number of jobs. We need a clause to regulate the growth in the level of exports so that when they reach a certain level the growth factor is set aside or existing levels are re- duced, depending on the state of the home market.

Secondly, we believe that there should be a quota, so that when imports of particular products reach a certain level they can be cut off. That relates to the point made by the hon. Member for Macclesfield (Mr. Winterton) about imports from China.

Thirdly, the procedure for dealing with dumping should be improved and speeded up so that complaints can be dealt with quickly before unemployment occurs.

Fourthly, we want an assurance that an agreement of this kind will continue for at least six years and possibly for 10 years, so that the industry can get on with long-term planning to restore confidence in the industry and so secure investment and make more jobs available.

The problem in competing with low-cost suppliers is that of comparing like with like. It cannot be said that there is fair competition when we are competing with countries whose workers are wage slaves and where there is no form of free trade unionism or free collective bargaining or any form of social security. We believe that we must attach to these negotiations a social clause which will ensure, through an international inspectorate, that the conditions of these workers are improved in such a way as to raise their wage levels so that British workers are able to compete on a fair basis. Unless this happens Government spokesmen will have to make constant appearances in this House to discuss closures similar to that at Skelmersdale We know that 40 per cent, of the labour force at Nelson and Colne and Rochdale is involved in the textile industry—in my constituency the figure is 25 per cent.— and a further 35 per cent, of the work force is concerned with footwear. This Government have the fate of those workers in their hands. We demand that the situation at Skelmersdale must not be repeated.

9.52 p.m.

Mr. James Molyneaux (Antrim South)

We congratulate the hon. Member for Ince (Mr. McGuire) on affording us the opportunity to discuss this important subject. I speak on behalf of a significant number of workers in Northern Ireland who are affected by the Courtaulds closures.

Since the announcement of the closure of the Carnmoney factory in my constituency, I have kept in close touch with the management and with the work force, and I know that those concerned have acted in a responsible manner. The workers have recognised that there is a degree of inevitability about what has happened to their factory. Although those workers have undergone a painful experience in an area of high unemployment, they are not despondent and are determined to switch their skills to other openings that may be available.

My hon. Friend the Member for Antrim, North (Rev. Ian Paisley) has an even bigger stake in this subject than I have, because he has a number of large Courtaulds undertakings in his constituency. I know that he shares my concern and the concern expressed by Labour Members about the future of the company.

I pay tribute to the company for all it has done in Northern Ireland. As a major undertaking it has breathed new life into the industrial scene of Northern Ireland. We regret this temporary setback, but we recognise that it has occurred through no negligence on the part of the Government, and certainly through no ill will against Northern Ireland. It has happened simply as a result of the economic facts of life.

I assure the House that we on these Benches will co-operate with the company and with Her Majesty's Government. I wish to place on record our appreciation of the work undertaken by the Undersecretary of State for Northern Ireland with his responsibilities for commerce, and also to his colleagues in the Northern Ireland office. I am glad to see the hon. Gentleman present for this debate which will have its effects in a Northern Ireland context.

We want to express to the Minister of State the appreciation of all concerned in the man-made fibre industry for the work done by his Department. He will not mind my saying that the Department of Commerce's contribution and intimate grasp of company affairs is unmatched by any Department on this side of the water. That is no criticism of those Departments, but it illustrates the value which is placed on decentralised Government structures in Northern Ireland. I think the Minister of State will agree that, had not the Department of Commerce machinery been available, his task of helping Northern Ireland companies who were in difficulty would have been very much greater. I want to place on record the appreciation of my hon. Friends for all that the Government have done, particularly in this case.

9.57 p.m.

Mr. James Lamond (Oldham, East)

I should also like to congratulate my hon. Friend the Member for Ince (Mr. McGuire) on the way in which he presented his case. It was a fine example of an honourable Member standing up for his constituents. This is not the first time he has done this. Our minds go back to the unfortunate closure of the Thorn factory in Skelmersdale, when my hon. Friend put up a really magnificent fight. He has used every possible parliamentary opportunity to draw attention to the Courtaulds problem. He made a good case and explained the difficulties in his constituency, but he also widened the debate to include North-West England's textile industry. I am grateful to him for that.

There have been many meetings between trade unionists and the Chairman of Courtaulds and between the Government and the Chairman. There was an excellent meeting in the House of the All-Party Textile Group. Sir Arthur Knight was kind enough to attend—I say this with due respect, because he had no need to come—and answer questions from hon. Members with constituency interests. Sir Arthur understood that when Courtaulds—which has more than 300 centres of employment in this country—has difficulties, repercussions are felt beyond North-West England.

At the meeting of Oldham Metropolitan Council's Industrial Development Committee last week, a report was submitted which showed that although there were to be no direct closures in the Greater Oldham area, a cold fear gripped the hearts of my constituents, because there are Courtauld plants in the town.

The inquiry, for which my hon. Friend the Member for Ince has correctly called should, if possible, include some reassurance about the future to employees at other Courtaulds plants.

Courtaulds, like other firms in the textile industry, has been making massive investment over the last few years. The industry has moved from being labour-intensive at the beginning of the century to its position today as the second most capital-intensive industry in this country after the chemical industry.

It is an example of the point which my hon. Friend the Member for Ince made about investment not necessarily creating jobs, that during this period of massive investment the number of textile jobs in the North-West has fallen to one-tenth of the level of 50 years ago. Nine out of 10 jobs have disappeared. I doubt very much whether there is another industry with such a record, but I am not wholly despondent about it.

One of the things that I like about my constituency is that, unlike that of my hon. Friend the Member for Rossendale (Mr. Noble), it is not as dependent on textiles as it once was. The industry is much more diversified, and therefore, in my opinion, employment is much stronger than in an area which depends on one industry.

Coming from Scotland as I do, I can think of many towns which at one time had only one industry. I remember the jute industry in Dundee before the war—

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

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

Mr. Lamond

It used to be said that Dundee was entirely dependent on jute, jam and journalism. The result was that unemployment in Dundee was at a very high level. Dundee was given aid even before the war for this reason. The idea is not new.

When Sir Arthur Knight appeared before the committee I thought that he answered the questions put to him in a straightforward and reasonable manner, from the standpoint of someone operating in the market place. Courtaulds, of course, does not take into account the social consequences of closures of this kind. It takes into consideration the losses that have been made in the factory, the possibility of turning them into profit, and so on. I do not blame it for this.

I accept that it works in that atmosphere.

The Government have been trying to inject into the thinking of employers in this country the idea of taking social consequences into account. Based on that concept, the Government have developed a strategy for the regions. Obviously, when we see this sort of unemployment figure in new towns, the strategy has not been working. It is bad enough in areas on Merseyside, where there is an unplanned development of industry. But where it is supposed to be planned, where an area has every advantage that the Government can think of to enable it to develop in a correct way, and still there are closures, the Government must realise that it is time for a radical examination of their development area policy, and perhaps a reorganisation of grants, and so on.

The present policy is a very blunt instrument. I do not want to be disloyal to my own home town—Aberdeen—which is very dear to my heart. I yield to no one in my admiration for that city, but for seven years it has enjoyed full development area status, while having unemployment of under 2 per cent. Dozens, if not hundreds, of firms have flooded into the area, drawn there by the market forces, yet it has persisted in retaining development area status.

When I went to Oldham as a Member it had no development area status. I pay tribute to the Tory Party for making the area an intermediate development area and for recognising the needs of the North-West.

I think that this inquiry is needed and that it should be as wide as possible. I recognise that it cannot possibly encompass an examination of the Government's entire development area policy, but that aspect also should be borne in mind by the members of Government when they are thinking about the problem.

10.4 p.m.

Mr. Nicholas Winterton (Macclesfield)

May I from the Conservative side congratulate the hon. Member for Ince (Mr. McGuire) on raising this vital subject in the House this evening. He has done the House a service, and I hope that some of what has been said in the debate will be taken on board by the Ministers.

I am delighted that so many leading Government Ministers have been on the Treasury Bench tonight.

I am delighted to follow the hon. Member for Oldham, East (Mr. Lamond), because he is chairman of the all-party textile group of which I have the honour to be vice-chairman. I think that all parties in the House, through this Committee, have made the strongest recommendation to the Government to persuade them to appreciate the position and the difficulties facing the textile industry at this time.

It is unnecessary for me to pursue that particular matter further tonight, although inevitably the Courtaulds situation and the closure of some of their textile plants is very closely involved in the problems of the textile industry, which is facing unfair competition from the Third World and from the Comecon countries. Skelmersdale, however, is rather a different case.

From the Opposition Benches, I wish to support the request by the hon. Member for Ince for an inquiry. Although an inquiry may be considered by the Minister to be unnecessary, I take the opposite view, because it may bring to the attention of the Government—especially that of the Departments of Industry and Trade—the unique problems being faced by the textile industries of Great Britain and Northern Ireland.

The hon. Member for Rossendale (Mr. Noble) put forward some powerful arguments. I am sorry that he spoiled the effect of his speech by unnecessarily attacking Courtaulds for what he described as "an abuse" of the grant situation. I do not believe that Courtaulds has abused the grant situation. It went to Skelmersdale, as it has gone to other development areas, in good faith to try to provide much-needed employment. However, the company has encountered insurmountable problems which, after a number of years, have led it to take this very unfortunate decision to close the plant.

Mr. Noble

Does not the hon. Gentleman agree that the legitimate use of public funds through development area grants and so on in circumstances where companies are not accountable may not perhaps be an abuse but can lead to diffi- culties of the kind that we see at Skelmersdale?

Mr. Winterton

I think that a large public company such as Courtaulds is particularly accountable to the Government, to the public and to its own employees.

I represent a constituency which has important textile industries. In recent times, Courtaulds has closed two mills in my constituency—the Clarence mill and the Adelphi mill, both in Bollington. Those two mills have provided employment in the village and in my constituency around it for many decades. The company took the decision reluctantly and it tried very hard to provide alternative work in those mills before finally closing them. Unfortunately, it was unable to do so.

I believe that Courtaulds has acted in good faith. I took on board the point which Sir Arthur Knight made with considerable emphasis when he talked to the all-party committee that, by closing these plants, the company was safeguarding the employment of its other 110,000 employees. We must not overlook that vital fact. It would be stupid for Courtaulds to go on pouring money—whether it be Government money provided by the taxpayer or out of company profits—into a plant making huge losses year after year. I think that I quote Sir Arthur Knight correctly when I say that in the last accounting period—I forget whether it was a nine-month or a 12-month period—the plant at Skelmersdale lost almost £900,000. That is a great deal of money.

An inquiry can be useful to the textile industry. It can also be useful to the hon. Member for Ince and to all his constituents whom he represents so well in this House.

In addition to looking at the particular problems of the textile industry, I hope that the Minister will consider what help the EEC regional fund can provide to an area which is facing unique problems because of the closure of two very important industrial plants, with the dire results that it brings to the people of a new town area such as Skelmersdale.

10.9 p.m.

Mr. Eddie Loyden (Liverpool, Garston)

I wish to support the appeal made by my hon. Friend the Member for Ince (Mr. Maguire). I attended a meeting in Liverpool on Friday at which some of his constituents were present, and I know that he reflects the very strong feelings of those workers about the need for a public inquiry.

My hon. Friend was right to raise the problems that the closure of Courtaulds represents for Skelmersdale. What is more, in the wider context of the argument, I feel that my hon. Friend the Member for Rossendale (Mr. Noble) was right to analyse many of the problems and to project some of the solutions for the textile industry as a whole.

One of the serious points made by my hon. Friend the Member for Ince was about the very nature of Skelmersdale. It is just a segment of the whole problem which exists in that part of the country. The people of Skelmersdale virtually were sent from Liverpool to this overspill area in anticipation of finding new homes and new employment opportunities for a considerable time to come. They were moving away from an area of persistently high unemployment into a new town which offered all the possibilities of security of employment and a better environment.

This was all part of the grand scheme of depopulating the city of Liverpool in a way which has been going on every since. To the people of Skelmersdale, this planners' dream of ending commuting between that part of Lancashire and Merseyside has ended in a nightmare. Now they are virtually imprisoned in the area with only limited employment opportunities.

The Government should consider the questions raised on a number of occasions about the indivisible problems associated with the depopulation of city centres and the development of new towns. The solution to one will bring the solution to the other. The Front Bench Ministers who are here tonight are well aware of the problems, not only in the context of Skelmersdale but in the context of Merseyside generally. They know about the declining nature of industry in the whole area, and they have given considerable attention to these difficulties.

However, we want to see firm action on these problems. We believe that one of the first things which should be done about Skelmersdale is the establishment of a public inquiry to examine the correctness or otherwise of Government policy in relation to the provision of finance to industry. While it is quite right that reference should be made primarily to the loss of the Skelmersdale factory, there has been silence on the question of the general profitability of Courtaulds. I am not arguing that green pastures should develop overnight, but [ do want to see a firm commitment that these people, who went to Skelmersdale in good faith, will be treated decently. Opportunities for employment should be retained in the area so that it does not continue on the present downward spiral.

10.14 p.m.

The Minister of State, Department of Industry (Mr. Alan Williams)

Like other hon. Members who have spoken, I congratulate my hon. Friend the Member for Ince (Mr. McGuire) on getting this matter debated. It is an issue of great concern to hon. Members in all parts of this House. I congratulate my hon. Friend on the moving and clear way in which he pressed the case on behalf of his constituents and those of other hon. Members affected by closures in other factories.

I am sure that the hon. Member for Antrim, South (Mr. Molyneaux) will understand if I do not deal with the situation in Northern Ireland. However, I am sure that the Minister of State for the Northern Ireland Office was very glad to hear his comments about the work of the Department of Commerce, and the role which Courtaulds play generally in Northern Ireland.

I am glad that my hon. Friend the Member for Flint, East (Mr. Jones), the Under-Secretary of State for Wales, has been sitting at my shoulder during the debate—muttering in my ear in a quite rebellious manner. I must remember to have a word with the Whips on Monday. Of course, he, like my hon. Friend the Member for Ince, within hours of the announcement being made, had come to me about the closure and its impact and about what should be done further for constituents.

I hope that the company will realise that although we shall have had nearly one and a half hours for this Adjournment debate, whereas the normal time is 30 minutes, the only thing limiting it to the one and a half hours is the procedure of the House and the fact that we cannot go beyond 10.30 p.m. I hope that the company will take this as a measure of the strength and depth of feeling that exists in the House and the disquiet here over the effect of these closures.

My hon. Friend the Member for Ince said that it came as a shock to him when he heard the announcement. Equally, it came as a shock to the Government. We shared the disappointment that he and other hon. Members have expressed at the fact that only the minimum notice of 90 days was given of the intended closure. Indeed, as my hon. Friend said, if ever there were a vindication of the Government's Employment Protection Act, it was this. One wonders how little the notice might otherwise have been, as the company clearly intended to give only that notice which legally it was required to give.

My right hon. Friend the Secretary of State for Employment and other members of the Government have asked the company to consider extending the 90-day period, but as yet the company has made no positive response to this request. The Government have anticipated the points that hon. Members have made, and we have certainly impressed upon the company the points that hon. Members have wanted to put tonight. I shall see that these are reiterated to the company in the light of this debate.

My hon. Friend the Member for Ince expressed concern about the future of Harwood Hosiery, another Courtaulds unit in his constituency. As he was, I am sure, expressing the disquiet of many of his constituents, I think that it would be appropriate, although it is not strictly on the actual Skelmersdale factory issue, if I give certain reassurances.

We have been in touch with Courtaulds about Harwood Hosiery because of the rumours that have been circulating. According to Courtaulds, it is quite common for there to be short-time working just before Christmas in this particular sector of the industry, and this year Courtaulds will be introducing some short-time working in all their United Kingdom hosiery plants except for the two under notice of closure. This will not involve closure but will be done by cutting out the odd shift, perhaps, or extending the Christmas holiday. Short-time working will extend from 25th November to 1st January. Normal working should resume after that date.

I am sorry that I kept fairly closely to the words with which I have been supplied, but knowing the extent of the concern there must be in Skelmersdale about the possibility of even further closures, I hope that I have gone some way towards alleviating the worries that my hon. Friend has expressed. Indeed, Courtaulds actually denied absolutely that it had any plans to close Harwood Hosiery. I hope that that is some reassurance to my hon. Friend.

As to statistics, while we recognise the problems that my hon. Friend the Member for Rossendale (Mr. Noble), is representing—I shall not go into these in detail now because so many issues have been raised on which I want to touch—I would only say that in a sense my hon. Friend has a point, because of the differences between the travel-to-work area and the geographical size of Skelmersdale. On the other hand, this does not mean that the Government, in assessing the needs of an area, are not fully conscious of the situation even within its travel-to-work area. My hon. Friend the Undersecretary of State for Employment will probably contact my hon. Friend further about that matter.

There have been comments about the paradox of capital-intensive industry—that the more money one puts in, the fewer jobs there are. Equally, however, if money is not put in, at the end of the day there are no jobs. It is a great tribute to the industry that the industrial relations over this period of capital restructuring have been incredibly good because workers and employers have recognised that it is in their interests to be among the most efficient and effective in the world. So although it is a paradox, we should be making a terrible error if we took the naive solution of saying that all capital investment is bad because fewer people in the end get jobs.

Mr. Noble

Would my right hon. Friend accept that unless something is done soon about imports, capital investment will stop anyway due to lack of confidence?

Mr. Williams

I am trying to work my way through the points raised. My hon. Friend certainly raised this matter clearly, as did my hon. Friend the Member for Ince and two other hon. Members when they met the Prime Minister and myself only last week to discuss the problems of textiles in the north-west end of Skelmersdale.

My hon. Friend also raised the question of Leyland Motors and the components factory. He referred to it also when he met the Prime Minister and myself. I have checked on this. There does not appear to be any plan for a new components factory. There is a project in relation to the bus and truck division which it is envisaged will be at Leyland, near Preston. If my hon. Friend wants to know more about that—if that is what he has in mind—he and I can have a word about it. I shall probably see him on Monday afternoon when he comes with another deputation.

Mr. Leslie Spriggs (St. Helens)

My hon. Friend has touched on a difficult problem. St. Helens has one of these Leyland bus depots in my constituency. There is some development in this direction. I hope that he will not go ahead with any horse trading.

Mr. Williams

My hon. Friend should not jump to conclusions. All that I was doing was explaining that there was no project such as my hon. Friend the Member for Ince had mentioned. I said that the only project of which I was aware was this project—

Mr. Spriggs

I am watching you.

Mr. Williams

I did not say that I intended to raid my hon. Friend's constituency to see how much employment I could snaffle from his area. I am sure that his constituents will be very pleased that, literally within seconds of anyone mentioning his locality, he is on his feet to defend it.

My hon. Friend the Member for Ince also referred to the need for skillcentres. My Department and the Department of Employment have discussed this. Again, I am speaking to another Department's brief—and a very good one it is—but my understanding is that the Training Services Agency recently carried out a review of the training needs of Skelmersdale and at that stage concluded that they were met by the skillcentres at Liverpool, St. Helens and Kirkby.

But—it is an important "but"—approaches were made by the Merseyside Training Council and the Merseyside Development Corporation, as a result of which, and the representations made by my hon. Friend, the TSA is now urgently considering whether some additional training facilities can be provided in Skelmersdale itself. So the question has been reopened and I am sure that we all hope that the outcome will be satisfactory for my hon. Friend.

Several hon. Members have referred to the need for an inquiry. I am sure that all Ministers who are present—an unusual range of Ministers for an Adjournment debate have been present tonight—will acknowledge the point made. The Government have said that they are willing to consider an inquiry. My right hon. Friend the Secretary of State for Employment told me while he was on the Front Bench that he has himself already had certain discussions with some of the relevant union leaders. We undertook that the relevant unions would be consulted before an inquiry is set up. I hope that the Government decision on whether to have an inquiry will be announced soon. I shall convey to my colleagues the strength of my hon. Friend's feeling on this matter. I am sure that it would clear the air and lead to positive results.

Hon. Members referred to the Courtaulds new factory at the Belmont. The company say that the equipment at the Belmont factory is for the manufacture of different fabrics from those produced at the Skelmersdale factory. The Belmont factory is not yet being used. Government funds were available along with the normal regional facilities. The company received regional development grants which, as hon. Members know, are virtually automatic. But, because we have been unable to get any assurance from the firm on a date for opening the plant, the company was asked on 1st November for repayment of the regional development grant.

I trust that hon. Members who asked for scrutiny will accept that as evidence that the Government do scrutinise the use of funds. It is normal practice to ask for a refund if money is not used as originally anticipated or if the project does not reach fulfilment. The Government monitor the grants against the purpose for which they were allocated and they are therefore subject to accountability. In fairness to Courtaulds which has been heavily criticised this evening, I must say that it will be investing about £70 million in this country this year. It is easy to jump to the wrong conclusions about the firm's motives but it is still a major investor in this country and therefore in its economic future.

I took up the issue of bringing forward the hospital project with the relevant department. I understand that the matter was raised as recently as August with the Department of Health and Social Security and considered sympathetically. Correspondence was copied to the North-West Regional Health Authority and the Lancashire Area Health Authority. I am advised that in the light of the current review of provisions for the Ormskirk district it is likely that the existing Ormskirk hospital will be developed as the district general hospital and that a community hospital will be provided at Skelmersdale.

The plans are still at the investigatory stage and, in view of the current financial situation, it is difficult to give a firm assurance about a starting date. However, my hon. Friend's views were put to the Prime Minister, who has drawn them to the attention of the Secretary of State for Social Services who will ensure that the North-West Regional Health Authority is made aware of the situation.

I am sorry that we have not been able to cover all the issues in the debate, but I shall be pleased to meet hon. Members to discuss these matters in detail. I shall be meeting a deputation on Monday and perhaps we can have further discussions then.

Question put and agreed to.

Adjourned accordingly at twenty-nine minutes past Ten o'clock.