HARTLEPOOL (EMPLOYMENT) (Hansard, 13 October 1976)

§ Mr. Ted Leadbitter (Hartlepool)

What I have to say in this debate about the problems in my constituency is bound 590 to take into account the realities of the economic situation in the United Kingdom and throughout the international industrial trading world. I have a responsibility to be objective, for the greatest help I can afford my constituents is to bring to the attention of my hon. Friend the Minister an appraisal of the facts. We are still fighting to bring down inflation. We are still faced with the attack on the pound. We are still in the trough of the worst international economic recession for 40 years.

591 Our basic troubles did not start a few months ago or even two years ago. More than one authority has pinpointed the manner in which this country failed to face the rising economic storm. More recently, comments in the Investors Chronicle included the following observations: To see it in perspective we need to go back to 1973. In that year money supply on the broader definition increased by not far short of 30 per cent.… In other words, not only was Britain pointing in the wrong direction in almost every aspect of its economic management but the country was determined to move even faster down the wrong road.… Most of the figures—wage increases, inflation rates, and above all Government borowing requirement— are still frightening. But three years ago they were all in the wrong direction. Most of them are now moving in the right direction. Certainly our economic strategy is beginning to show signs of turning the tide. The rate is not as we would like, and it must be conceded that, taking recent monthly figures separately, the position can be said to be erratic. Our general position is related to a worldwide hesitation in growth during the second quarter of this year. A report in the Financial Times this morning states: While growth has slowed down throughout the world in the second and third quarters, the check to the recovery in the United Kingdom is more marked and it is clearly disturbing that it even occurred before the latest crisis. We must be on guard, in the knowledge that our strategy hopes can quickly be blown off course. Strategy changes in these circumstances will be needed.

There is, however, a trend in industrial output showing in the latest quarterly recorded figures a rise of 1.4 per cent. That is an annual rate of 6 per cent. As my right hon. Friend the Chancellor of the Exchequer said on Monday, this increase has led to an increase in employment. Other indicators show that at least we are developing the right priorities. The rise in export volume for the past 12 months is approximately 10 per cent. Chemicals, metals and principal manufactures are up by 20 per cent. Exports to Germany have jumped by 24 per cent. in real deutschemark terms since 1975. There are new engineering orders rising at the rate of 20 per cent. during 592 the year. This also applies to chemical exports.

Sixty per cent. of our foreign customers have already declared satisfaction at our improvement of delivery dates. A CBI survey shows that 88 per cent. of our customers have acknowledged that British prices are competitive. Our exports to the Middle East have improved. During my visit there recently I was exceptionally impressed by the growing British involvement. All this points to a substantial shift of gross domestic product into exports.

I therefore approach the Government with the problems of my constituency, fully acknowledging the formidable tasks they had to face on coming to office. Among these I include the highly costly form of local government introduced by the previous Conservative Administration, the unsatisfactory reorganisation of the National Health Service and the economic damage which had been done by that Government's policies of confrontation. I also acknowledge the present Government's measures since coming to office.

But my constituency has suffered sorely. Unemployment and a denial of the standard of public and personal servicing which we once enjoyed are burdens my constituents should not be asked to bear. The registered unemployed in Hartlepool in September this year totalled 4,623, representing 10.9 per cent. unemployed. Some 1,065 females are out of work, and in addition 274 girl school leavers have not had either a first offer or an offer which has kept them off the unemployment register. We also have 3,284 men and boys wholly unemployed. This is 12.3 per cent. of the male working population. In fact, the total unemployed has risen by nearly 300 in one month.

These are not acceptable figures. They are a much higher proportion than those of the region. The figure for men is 3 per cent. higher and for women it is 2.3 per cent. higher. Our total figure of 10.9 per cent. out of work, compared with 5.5 per cent. for Britain as a whole, in-dictates a measure of the gravity of the problem.

But that is not the complete story. We still have steel closure proposals, involving about 4,000 jobs, which we must 593 fight. If we place that fact against the recorded increase of unemployment of 1,200 people since January, we have the spectacle of a trend which, if not halted, will be damaging to the social fabric of my constituency. I ask the Minister to call urgently upon the Secretary of State —indeed, the Cabinet as well—to examine the case for special treatment. My close experience with the industrial trends, the economy and the social life of my constituency over more than a quarter of a century must be heard against the prognostications of planners who during the same period have had a remarkable track record of being proved wrong.

Unless steps are taken over matters where the Government have control, the unemployment levels could rise in the short term to the alarming figure of about 20 per cent., and 25 per cent. for men. Now is the time for action. If the Government's own argument this week is that we have the strategy right, within that strategy at least one factor is beginning to show. Our regional figures are slightly improving, but those of Hartlepool are worsening. This is linked with the likelihood of a major industry leaving the constituency. The job multiplier for Hartlepool has been assessed, and the full meaning of this is that for every job lost in Hartlepool in the basic industries 1.3 other jobs are lost. In other words, 1,000 jobs lost in this way means the loss of another 1,300 elsewhere in the town where the immediate impact is on ancillary and supply services.

Some of this can be taken up either by migration of labour or by other job provisions being made available. But in a town where the net redundancy figures are of the order of about 500 per year the latter is academic and the former a serious loss of skills which could take years to replace.

But we also have the loss of purchasing power in the community which will be harmful to the retail trade, our commercial prospects, our forward planning and, in fact, the aspirations of all councillors seeking to provide, through local government, essential amenities to provide the right conditons for the people they represent.

The continuation of the present trend will involve the loss of apprenticeships. These will be very difficult to replace. At 594 the other end of the scale, men and women over 55 years of age have little hope of either new training facilities or a job. These groups, and the centre core of workers still bringing up their families, have a right to expect something better. There are grave social and psychological considerations to be taken into account where traditional industries have played such a great part in developing the character and nature of a town.

Certainly a number of Government measures have helped. The temporary employment subsidy, the job creation programme, the more recently announced work experience programme and the job release scheme have brought out of unemployment many thousands of men and young people throughout the country. I know that many officers, trade union officials, employers and others are doing sterling work under these schemes in Hartlepool and the North. They are to be commended for their approach to a very difficult task. Nevertheless, Hartlepool has not fared as well as it might have done, and in any case there is a need to consider to what extent in the circumstances we are merely creating palliatives and even dead-end jobs.

As I understand it, the Government are satisfied that the level of training for industry, both in house training and that provided in Government training centres, has been maintained to the level established in the boom years. That may be so, but are we providing the right kind of training to meet the requirements of a rapidly changing society? There is no point in having a training course and raising expectations if at the end of the course the person trained is either not wanted or no vacancy is available. This only produces a waste of public money on the one hand and disillusionment for the people affected on the other.

The same is true of professional training. I fail to understand the logic, or indeed any argument, which supports conditions where teachers and students are in the same dole queue. There must be something wrong with our society when trained nurses and other hospital trained staff, as well as patients, are kept out of hospitals. The social cost of this state of affairs is both a waste and a tragedy. I put it to the House that we cannot afford to lose skills of this kind. Indeed, 595 it raises the very question of the total costs of keeping people idle. In thousands of cases it is a well-known fact that it is more costly to keep a man or woman out of work than in work.

In describing the levels of unemployment in my constituency, it can be seen already that I must enter the wider field of matters other than the dramatic statistics. I have referred to nurses, teachers and lost opportunities following industrial training. But I cannot forget the need to measure other losses. There has been a downturn in the provision of home helps. Many old people's homes are overcrowded and the staffs are overworked to a point where some danger may exist. Our social workers in the field are strained to the utmost and most of the staffs closest to the public requirement are overtaxed. I am not surprised to find a great deal of discontent in local government. But, for what it is worth, there is a need to tackle waste, to get better value for money by concentrating on the grass roots provision of services, and to ask ourselves whether the present system provides the right balance for efficiency.

The director of social services in Cleveland has kindly given me his observations though at short notice. He states that rising unemployment will cause greater distress than already exists in the community. I accept that that claim can be made by many, but I am dealing with a special case where the developing situation is critical and industrial inquiries for development are fewer.

The director of social services adds that the effect on families will be to cause stress factors which may result in an increased need for medical and social work care. Many families are unable to adjust to a reduced income. Increasing debts add to the appeals for social services and social security at a time when the departments concerned are fully stretched. He expects an increase in mental illness and delinquency. The rise in unemployment will make it more difficult to place handicapped people of many categories in gainful employment. These are costly consequences providing pressures on our services which are bound to mean that for many there cannot be a service.

596 I have sought the considered opinion of our probation and after-care service. I am informed that there is no difficulty here in identifying people who have suffered through loss of work. There are instances when debts accumulate with rent and hire-purchase commitments and people fall into increasing arrears followed by fines and maintenance payments. Gas and electricity bills have increased markedly in recent months. These provide added pressures on the unemployed and, in fact, on all low-income groups.

The probation service states that there is some worry now about the emotional effects of unemployment. While there are varying degrees of motivation to work, those who are highly motivated are suffering excessive frustration where unemployment experience has become chronic. I am informed that people looked after by the service experience a number of problems—material, emotional, psychological and social—which interact and are mutually influential. In this context, a high unemployment rate can be seen as an additional problem which the staff and their clients could well do without.

I am informed that there is a problem arising from pressures on accommodation to deal with the number of care orders. Accommodation is needed where, as I understand the position, the magistrates are not happy if the present stretched position causes young offenders to be sent to remand homes and places where they will have to mix with adult prisoners.

I have examined the number of care orders, supervision orders and attendance care orders. The comparative figures over the years, while showing some decline, only illustrate the concern of magistrates and the tendency of the police to caution more than bring offenders to court. This may be a desirable social tendency, but in the light of the reasons for it—namely, overcrowding—I can only conclude that the magistrates ought to be thanked for their expressed worries and the police for the excellent work they are doing in this field.

Finally, I want to bring urgently to my hon. Friend the Minister one social consequence which is heart-rending. The wives and mothers struggling to meet the many problems facing their families suffer extremely the daily worry of sustaining 597 their husbands and sons and daughters, Family morale is of the highest importance. These are the people making the greatest sacrifice even when their families are considerate. But wife-battering is not unrelated to unemployment, frustration, and all the consequent friction which boils up in a world where costs are rising and the means of meeting them are perpetually in doubt. Broken homes and lives are there for us all to see, and from personal experience I can tell the Minister that I am ashamed that even today it is the woman who is hardest hit when this happens.

I should like to end by expressing my appreciation of this opportunity to raise the problems of my constituency and of the co-operation I have received from every Government Department with which I have discussed these matters from time to time. I enjoy good relations with my hon. Friend who is to reply to this debate, and I am sure he will convey to the Secretary of State not only this factual account of the situation in my constituency but my personal request for some early action on matters over which I am sure that the Government have some control. I shall appreciate an undertaking from my hon. Friend that there will be continuing discussions to deal with this matter.

§ The Under-Secretary of State for Employment (Mr. John Golding)

I am grateful to my hon. Friend the Member for Hartlepool (Mr. Leadbitter) for raising the serious matter of unemployment in Hartlepool in a most moving and lucid speech. I begin by assuring him that we constantly have under review the problem of unemployment throughout the country and we shall certainly pay attention to Hartlepool.

No one can exaggerate the seriousness of the situation, both in terms of loss to the community and in the damaging effect described so graphically by my hon. Friend on the unemployed workers and their families. We share with him a deep concern for all those affected. The problem is due both to the general recession and to the decline in the area of those industries which have in the past been so important to the town—iron and steel, shipbuilding and ship repairing.

598 The reduction in the amount of employment in the iron and steel-making industry has posed serious problems for Hartlepool. The relatively high level of unemployment in the area was, of course, one of the reasons which led the Government to decide to give Hartlepool special treatment and to grant it special development area status. This in itself is evidence of the high priority which the Government give to attracting new jobs to the area. We try to encourage and persuade firms to go to Hartlepool and are able to offer the full range of regional financial incentives to prospective employers. These include the regional employment premium, regional development grants and Government factories with rent-free periods of up to three years.

The Government advance factory programme has, in fact, played a big part in attracting employers to the area. Altogether there are now seven factories already occupied and another 11 under construction, and the Department of Industry is currently looking for more land for factory building. The ready availability of these advance factories should be a particularly attractive proposition for employers who will be looking for room to expand when the upturn in the economy comes. Employers may also be eligible for selective assistance in the form of loans and interest relief grants, and so far under this heading alone £2½ million has been well spent in Hartlepool in creating some 2,200 additional jobs.

We recognise that from all points of view Hartlepool has many advantages to offer employers, not the least of which is hard-working workpeople.

To help mitigate some of the worst effects of the present situation, the Government have introduced a number of special measures to save and create jobs —the temporary employment subsidy, the job creation programme and the recruitment subsidy for school leavers. There is also a community industry project in Hartlepool. Together, these schemes have secured some 450 jobs in Hartlepool. It will be known that we have now introduced a work experience scheme to provide young people under the age of 19 who might otherwise be unemployed with a realistic introduction to working life. We have introduced the youth employment subsidy, under which a £10 weekly 599 allowance can be paid for up to 26 weeks to employers who engage young people under 20 who have been continuously registered as unemployed for a period of six months or more.

I ask my hon. Friend to do all that he can to bring to the attention of employers in Hartlepool the importance of playing their part by recruiting young people and by making it possible for the work experience scheme to be the great success we expect it to be.

For the reasons which my hon. Friend has outlined, we recognise that we have a special responsibility to the young, but we have not neglected the needs of all others. We are aware of the problem of older workers to which my hon. Friend referred. We are particularly concerned to see the success of the job release scheme under which men over 64 years of age and women over 59 in full-time employment in assisted areas will be offered an allowance of £23 per week free of tax until they reach pensionable age, provided that they leave their jobs and are replaced by unemployed workers or if unemployed people agree to cease looking for work. This scheme should give help in Hartlepool where many manual workers have led a very arduous working life, and it will also help to provide jobs for younger men and women who would otherwise remain unemployed.

My hon. Friend says that we are satisfied with the level of training. The Government have allocated additional funds to the Manpower Services Commission so that it can provide extra training facilities to enable more workers to fit themselves for jobs in skilled trades and in the expanding industries which we aim to encourage to take the place of those in decline.

We cannot say yet that we are satisfied with the level of industrial training. We realise, moreover, that these special measures do not provide the regular jobs which my hon. Friend the Member for Hartlepool is seeking for his constituents. 600 We believe that these will be stimulated by our industrial strategy and aided by regional policy. Already there are encouraging signs that additional regular work will be coming available for building workers. There is the new BSC benzole plant, the ICI micro-organism animal feed stock plant, and new plants for Monsanto Chemicals and W. R. Grace. These projects, all in the Billingham area, are expected to provide about 1,500 jobs, many of which will be taken by workers from Hartlepool. For other workers in Hartlepool we believe that a total of 1,350 new jobs will appear in the next two years if the expansion plans of various local employers are put into effect.

This, of course magnified, is the solution to this general problem. Only through the improvement of our industrial performance can we bring down and keep down the present intolerable level of unemployment. Defeating inflation is the essential condition for that improvement, and the social contract has given us the means to do that. The next step, which depends, as so much else does, on bringing inflation down to the level of that of our competitors, is the regeneration of industry. This is the strategy to which the Government pledged themselves along with the TUC and CBI at Chequers last November and which we are now developing in the National Economic Development Council.

As the TUC's "Economic Review" says, The aim of the strategy is to put Britain on the path to a high wage, high output, full employment economy, by improving productive potential and the performance of manufacturing industry in particular with a priority for industrial development over other objectives. Reducing unemployment in Hartlepool, as elsewhere in Britain, which we very much want to do, means making a success of that policy.