Unemployment

HC Deb 06 July 1977 vol 934 cc1229-34

10. Mr. Fairgrieve

asked the Secretary of State for Scotland what action he intends to take about the steadily worsening unemployment position in Scotland.

Mr. Millan

We have already acted on a substantial scale through the various employment protection and creation measures, and my right hon. Friend the Secretary of State for Employment anounced last week a further series of measures in respect of young people.

Mr. Fairgrieve

Does the right hon. Gentleman appreciate that in the broader context it is only in the area of the smaller business and the self-employed that we can really reduce unemployment, and that it is the type of legislation that has been referred to by my hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor), which makes such people feel that it is not worth the candle and makes them unwilling to take on any more staff, that is causing unemployment? Is the right hon. Gentleman aware that the situation could be cured overnight if he would reduce that sort of legislation?

Mr. Millan

I do not accept that. A new experimental scheme for a small firm employment subsidy came into operation only last week. It will run for six months initially and, for manufacturing firms in special development areas employing fewer than 50 workers, for each additional worker taken on there will be a subsidy of £20 a week for six months. This is only one example of the various measures that we have taken to help small firms.

Mr. William Ross

Is my right hon. Friend aware of the grave position in Kilmarnock arising from the decision by the American directors of the firm of Cranes to close down—[Interruption.] I am sorry that SNP Members are not interested in Kilmarnock. Is my right hon. Friend aware of the grave position arising from the decision to close down Glanfield and Kennedy, in Kilmarnock? Will he explain what the Government have been doing to seek to prevent that, what help was given from Cranes, and what they are doing now to mount a rescue operation?

Mr. Millan

In the first place, we had completely inadequate notice of the impending closure. Despite that, we have had discussions with a number of interested parties. There has been no viable proposal put to the Government so far. If we are able to get a viable proposal, or put one together ourselves with the interested parties, we shall be happy. Our efforts in that way are continuing and are not affected by the fact that a receiver was put in on Monday of this week. I resent some of the statements that have been made by the employer which suggest a lack of effort on the part of the Government. We have acted expeditiously and with a great deal of effort. In my opinion, there has not been enough help from the management.

Mr. Steel

Does the Secretary of State accept that the small firms subsidy scheme, which is welcome, is none the less of limited application and that he should be looking at the severe decline in the numbers of small businesses in Britain as a whole and in Scotland in particular? Will he take on board, for example, that the temporary employment subsidy does not apply to firms employing fewer than 10 people and that that is one specific example of discrimination against small firms that is harming that sector of industry?

Mr. Millan

I do not accept that there is discrimination against small firms. I have given an example of a scheme specifically designated to help them. Perhaps I may give another example. The Scottish Development Agency is putting a tremendous amount of effort into helping small firms. It is untrue, and should not be repeated, that the Government are discriminating against small firms.

Mr. Welsh

Does the Secretary of State realise that his answer to my hon. Friend the Member for Perth and East Perthshire (Mr. Crawford), on an earlier Question, was an absolute disgrace? Does he further realise that literally thousands of jobs are at stake in the Scottish pig industry? What steps is he prepared to take to protect the Scottish pig industry from its present crisis?

Mr. Millan

The hon. Gentleman does not sound any better than his hon. Friend the Member for Perth and East Perthshire (Mr. Crawford).

Mr. Robert Hughes

Is my right hon. Friend aware that in order to cure unemployment it is necessary to sustain indigenous industry and to keep jobs already in existence as well as to create new jobs? Therefore, when, as I hope, he meets representatives from industry and the trade unions in the Aberdeen travel-to-work area, will he take account of the fact that many indigenous industries will be more badly hit than incoming firms, with the reduction from development area status to intermediate area status, and keep an open mind about ways in which the potential damage can be eradicated?

Mr. Millan

I note what my hon. Friend said. My right hon. Friend the Minister of State, together with the Minister of State, Department of Industry, is to meet a deputation from the Grampian area. There has been some misunderstanding about this matter. The change does not take place until 31st March 1978. Although plant and machinery grants will be lost, firms in the area will still be eligible not only for regional development grants but for other selective financial assistance under Section 7 of the Industry Act. There is still a tremendous amount of Government assistance potentially available in that area.

Mr. Younger

Is the Secretary of State aware that many people would be astonished to hear him say several times today that he is not aware that the Government's economic and legislative policies have been severely adverse to the profitability of many companies in Scotland? Does he not think that he is getting dangerously out of touch? Will he take advice on this matter from his advisers, the CBI, the chambers of commerce and, indeed, the SDA, because he will find that they are all at variance with what he said this afternoon?

Mr. Millan

I do not accept what the hon. Gentleman said. What I said is accurate. What he said is not accurate.

13. Mr. Donald Stewart

asked the Secretary of State for Scotland what plans he has for reducing unemployment in the Western Isles.

Mr. Gregor MacKenzie

The Western Isles have already benefited considerably from the job creation programme and other employment protection measures we have introduced. They will be further helped by the new and more comprehensive package announced on 29th June. In addition, our regional policies and the wide powers of the Highlands and Islands Development Board are designed to bring permanent new employment to the area.

Mr. Stewart

Is the right hon. Gentleman aware that I did not need my Question to be numbered 13 to anticipate that dusty answer, which is the same as his right hon. Friend has been giving me for months? Did the Minister take time off to see a recent television film about the Island of Harris, which pinpointed the deprivation in that area—one of the most hard-hit areas in Scotland? Will he have consultations with two of his hon. Friends who returned from the Western Isles last week and who have a good idea of the deprivation in the area and know what is required from the Government?

Mr. MacKenzie

I did not have time to see the television film referred to by the right hon. Gentleman but I had an opportunity of listening to his speech the other evening in the House of Commons, during which I thought that he was less than gracious to the Highlands and Islands Development Board. The Board, set up by my right hon. Friend the Member for Kilmarnock (Mr. Ross)— and a fine man he is—has already spent £4 million on 500 projects involving 1,600 jobs in the Western Isles, £1½ million on individual projects of its own, and £150,000 on construction firms. The right hon. Gentleman ought to read page 17 of the book, which says that when replies are given Members should listen courteously, with interest, in a relaxed fashion, and not make derogatory remarks in any way.

Mr. Fairbairn

If the Minister is considering the application of the new small businesses scheme, whereby subsidies are given for employing extra persons for six months, will he give a public warning that if any firm takes advantage of that scheme, employs any person for 26 weeks, and cannot afford thereafter to employ that person if the subsidy is withdrawn, it will have to pay damages for unfair dismissal? Will he also ensure that firms that are eligible for and have been given grants by the Highlands and Islands Development Board do not then set up branches in other areas to compete unfairly against them?

Mr. MacKenzie

The hon. and learned Gentleman, together with some of his hon. Friends, has been less than fair to what the Government have done for small firms. My right hon. Friend earlier referred to one specific aspect. If the hon. and learned Gentleman cares to examine the Government's record in relation to small firms—I refer to financial help, consultancy services and a wide range of help provided by the SDA and the Highlands and Islands Development Board—he will find that it is not in accordance with the adverse comments that have been made.

Mr. MacCormick

Does the Minister appreciate that the disgraceful statement on transport recently made by the Government militates against the carrying on of any kind of economic activity in the Highlands and Islands? Will he use his influence to try to get the decision reversed?

Mr. MacKenzie

The hon. Member made a minor contribution during the recent debate on shipping services to the Highlands and Islands. I indicated during that debate that the Government were reasonably generous in providing support for those shipping services.

Mr. Younger

Why have a record number of small firms gone bankrupt in the last few years?

Mr. MacKenzie

The hon. Member misunderstands the situation. Firms do not always go to the wall because of Government legislation. The hon. Member will know from his experience that small firms are often swallowed up by bigger firms. Large firms are often the biggest enemies of small companies.