HC Deb 09 November 1977 vol 938 cc689-814
Mr. Speaker

I have selected the official Opposition amendment.

4.20 p.m.

Mr. James Prior (Lowestoft)

I beg to move, at the end of the Question,to add :

But humbly regret that the Gracious Speech contains no proposals for creating the longterm business confidence essential to reduce unemployment and create prosperity in which all can share.

I say to the hon. Member for Newham, North-West (Mr. Lewis) that I feel that the problems with which we are very much concerned today over the attitude of the Fire Service has great relevance to this debate, particularly from the point of view of unemployment.

I begin by referring to the Queen's Speech. It says: My Government's main objectives are the speediest possible return to full employment and with that in mind, I thought that I would look through the Queen's Speeches that the Government have introduced since March 1974.

In the first Queen's Speech of March 1974 there was no reference to unemployment, and at that time unemployment was 618,000. It is true that as the summer went on unemployment started to grow and it grew sufficiently for the right hon. Member for Ebbw Vale (Mr. Foot) to say in July 1974: I am not prepared to sit in this place which is St. James's Square— and preside over mass unemployment. That was the view of the right hon. Gentleman when unemployment was 600,000.

In October 1974, just after the General Election, we find the first mention of unemployment in the Queen's Speech. The Government were concerned with maintaining employment when 640,000 people were out of work. At the time of that election the right hon. Member for Huyton (Sir H. Wilson) had accused my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) and myself of wishing to create unemployment. On the very eve of the election the then Prime Minister went so far as to say: Unemployment represents the difference between our two parties. One can say that again and again and again because it does represent the difference between our two parties.

I come to the Queen's Speech of November 1975, a year later. It said : In particular, success in these measures is required for the achievement of a satisfactory level of productive investment and to assist in the reduction of the present unacceptable level of unemployment.

We should note the word "unacceptable ". By this time unemployment had reached 1,147,000. That was regarded as "unacceptable ".

We move on to the Queen's Speech of November 1976, a year later, and we find that unemployment, which was unacceptably high at 1,147,000, had become 1,377,000. Here the Government firmly committed themselves to a lasting reduction in the level of unemployment at a time when unemployment had gone up by some 200,000 since the year before. While the Government were saying that, the Secretary of State for Employment was saying: I do not want to raise false hopes, but if we can maintain this pace Britain is on its way.

It was on its way to a figure this year not down, but up to 1,518,000 unemployed. That is the record of the Government over the last three and a half years. So never let anyone again say that Labour Governments do other than increase the number of unemployed in Britain.

One of the great worries, perhaps exemplified by the attendance in the House today, is that the capacity to shock comes at much higher levels of unemployment. than a few years ago. I believe it was John Hughes, the Principal of Ruskin College. who recently said : It is to be hoped that the facts on unemployment among young people still have the capacity to shock.

I hope that the figures of unemployment in society generally, but particularly among young people, will have the capacity to shock the House today and to shock the country into doing something about it. The complacency of Government Members and of Ministers on the subject of unemployment is nauseating.

The facts of unemployment are simply these. In two years the absolute numbers of young people unemployed for over three months rose over four times, for over six months rose six times, and for over 12 months rose five times. It is no good Government hon. Members pointing fingers at us and accusing us—they are the Government. What attitude would they be taking to figures at this level if they were the Opposition now and we were the Government?

It is no good hon. Gentlemen going round the Tea Rooms, or anywhere else, saying that unemployment is not the political issue that it was a few years ago. They know that every unemployed person, and every unemployed young person, is a threat to society in the future. The Government of the day and Parliament have a duty to do something about it.

We face a figure of 1.5 million unemployed, which most people regret and think is more likely to go up than down. It is not just cyclical in its nature but probably structural, too. The result is that young unskilled people particularly are unable to get jobs.

We face that at a time of an unsatisfactory economic situation throughout the world. Heaven alone knows where we would be in Britain now if it were not for the promise of North Sea oil. Nothing else has supported the economy in the last year. It is against that background that we must discuss our difficulties today.

If productivity had risen in the last two years at the same rate as it rose in the recession in 1970–72 and in the earlier recession of 1961–63—at 1.8 per cent. a year, which is not a high rate of increase in productivity—an additional 1.25 million people would have been unemployed today. In reality, therefore, it is only because our productivity and our competitive position have deteriorated so much in the last three years that we do not have much higher unemployment than is shown today.

I remember Labour Members castigating us for the "13 wasted years ". My goodness, the last three and a half years have not just been wasted—they are shameful years in the history of this country.

Mr. Eric S. Heffer (Liverpool, Walton)

Does the right hon. Gentleman accept that many of us would be much more inclined to listen seriously to his argument if the Opposition had not argued with the Treasury Bench that the cuts in public expenditure should be even greater than they were? Of course, the Treasury Bench argued that they were having to carry out those cuts in order to deal with the economic problem. At the same time, the Opposition criticised every move the Government made to sustain British Leyland, Chrysler and many other industries, without which there would have been further mass unemployment. Is it not typical hypocrisy on the right hon. Gentleman's part to attack my right hon. Friends for a crisis which we inherited and which we are trying to deal with as seriously as we can?

The Deputy Speaker(Sir Myer Galpern)

Order. There is a long list of hon. Members who wish to take part in the debate. I appeal to hon. Members to make interventions as brief as is reasonably possible.

Mr. Prior

It is the belief of every hon. Member on this side of the House, and, I suspect, of the majority of people in the country, that had the Government taken steps to control public expenditure at the time we were demanding it and not some two or three years later, a lot of the worst effects of unemployment could have been avoided. Secondly, the hon. Member for Liverpool, Walton (Mr. Heifer) and his hon. Friends should recognise that by saving jobs in one direction there is always a loss of jobs in another.

The latest OECD reports show that saving 10 jobs by Government action in one direction has always led to the loss of six jobs elsewhere. One does not necessarily save jobs in the best way by the means that the hon. Member for Walton suggested. In the last three years, we have priced ourselves out of jobs, become less and less competitive, and we are now in the position that we cannot even supply our own market whether with motor cars or coal.

Far from returning to the position of the autumn and winter of 1973, the country is in a far worse competitive position than it was at that time. Furthermore, we in Britain shall start the next stage of recession with an economy that is much more inflated, with a level of unemployment that is far higher and with the world economy in a far worse condition.

Let me say to members of the Government that everyone recognises the need for keeping to reasonable increases in wages in order to avoid further increases in unemployment. It is remarkable that, when wages were going up 10, 20, 30 and 40 per cent. in the summer of 1974 and right through until July 1975, there was little talk then about the effect that that would have on unemployment. However, we are now told that, if wages go up by more than 10 per cent., unemployment will increase. Presumably, what happened in 1974 and 1975 has a bearing on the unemployment figures now.

Are hon. Members opposite—particularly members of the Government—satisfied that the level of settlements is really what the Government tell us that it is? What is the true level of wage settlements now being reached in British industry? Where are those copper-bottomed productivity deals about which we hear so much? All the information reaching me and, I dare say, hon. Members on the Back Benches is that the deals are not proper productivity deals at all but ways by which the Government have been able to exonerate themselves from having to take further action.

I hope, therefore, that we shall learn this afternoon how the wage policy is operating and how the Government intend to ensure that, if there are productivity deals, they are genuine. The view of industry at the moment is that they are not genuine productivity deals.

We turn, then, to the constructive side of the problem. We accept the need for the measures outlined for young people in the Holland Report. We believe that the use of public funds to finance more constructive work than paid idleness must be right. But we have certain reservations. We have them because the Government were very slow off the mark and because their programme was one of essentially short-term measures which are now being rolled forward with, we believe, a lot of waste at the start. Certainly the idea of a union rate for the job was disastrous in the costs it imposed on the original scheme.

I hope that the schemes now being prepared and about which there has been much controversy in the last few days can be brought down to a level that allows young people to help administer them. That is extremely important.

I put this argument to the House. One of the difficulties about devolving the schemes a long way down is that the accountability of funds to the House is made much more difficult. One of the great increases in bureaucracy in the Manpower Services Commission and throughout the Government service has come about through trying to control accountability. I suggest to my right hon. Friend the Member for Taunton (Mr. du Cann), who is Chairman of the Public Accounts Committee, that the House ought now to see whether there are not better ways of having accountability which do not involve the degree of bureaucracy and centralisation or regionalisation which has to take place at present.

If these schemes are to work properly —the same can be said for many other branches of government—we need to get the effort put right down to the grass roots where people can use the money for themselves and take full advantage of it. I believe that it is accountability that is resulting in the Manpower Services Commission having to set up this rather bureaucratic organisation.

Secondly, on the constructive side we believe that, within the funds available for job creation, a general subsidy for employment in enterprises for the handicapped and disadvantaged is a much better way than making them depend totally on welfare payments. We are not happy about what is happening in unemployment amongst the handicapped and disadvantaged. We believe that there ought to be special subsidies available out of the job creation programme for industries prepared to employ them.

Thirdly, we think that there should be a review of the aid given to regional development. The policies of the last few years have very much favoured the big, prestigious technologies to the detriment of small, adaptive technologies with more people employed. This is well borne out by a report of the Cleveland County Council which was published a short time ago and which stated that Cleveland had attracted perhaps the highest development grant in the country. The report shows that in 1975–76 Cleveland attracted £48 million in Regional Development Grant. It concludes: We have seen that Cleveland has attracted very high levels of Regional Development Grant but this is a mixed blessing;…the main recipient industries have not created employment. I believe that there is now a strong case for a much different attitude towards companies which are obtaining grants in the development areas. I am sure that we can save a lot of money here—and that is important enough—but we can also ensure that the money is far better spent than at present.

We must be much more positive in taking speedy action to prevent dumping wherever dumping goes on. This country has always been too slow in stopping others exporting their unemployment to us. I am not for one moment suggesting protection, because I think that we should lose far more as a result of protectionist policies, but if anyone talks to any industrialist about what Japan is doing at the moment, he will see that there is no doubt that the British Government ought to be much quicker in taking action.

During the Summer Recess I was in the United States. I have seen the difficulties that its steel industry is in. It has had considerable redundancies—12,000 in and around Philadelphia at the time I was there. But I noticed that it was very quick off the mark in stopping British steel going into the United States on the ground that it was being dumped there at lower than the cost of production. I remember thinking to myself that if only we were as quick at stopping others dumping here, that would certainly help many of our industries.

Mr. Heffer

The right hon. Gentleman should apply to join the Tribune Group.

Mr. Prior

If the hon. Gentleman is asking for protectionism, the answer is "No ". But if he is asking for his Government to stop dumping, he had better come and join us.

Next, educationists must be made to realise—this will not be popular—that they have a responsibility for the manner in which young people are prepared for employment. There must be greater cooperation between the last few years at school and the first few years after leaving school, or after the age of 16. We have to place obligations now on the education service to pay much more attention to this matter than it has in the past. We cannot go on with a situation in which so many young people over the next few years will be ill trained to get a job.

Mrs. Elaine Kellett-Bowman (Lancaster)

Has my right hon. Friend noticed the interesting difference between the number of permanent jobs obtained by youngsters who do extra training actually in industry under the Training Services Agency rather than through colleges of further education? The employment take-up in the former case is often 100 per cent. and in the latter it is often only up to 70 per cent.

Mr. Prior

My hon. Friend raises an interesting point. I should like to follow that on the whole question of training. I was about to say on the question of training that there is no doubt that a lot of our training is being totally wasted at the moment. In the book "MSC Review and Plan 1977 ", which was published yesterday, there is a discussion on the success of the Training Opportunities Scheme. Paragraph 4.32 tells us: … the number of people completing courses has risen from 15,600 in 1971 to 89,700… in 1976. But then in a further paragraph one reads that only 1,400 of those 90,000 were given technician training courses. So the presumption is that the vast majority of the courses were courses for typing or shorthand, or courses of far less relevance to the real needs of Britain in the next few years. I do not think that it is any good training just for the sake of training, particularly under the TOPS scheme, unless we are putting it to proper use.

Mr. Arthur Lewis (Newham, North-West)

We had an announcement only today from the Government that they are to train recruits who will receive wages and salaries which the existing firemen—who are dissatisfied with their present wage, and we all know the rest of the story—say is insufficient. Is it not ridiculous to think that they will get recruits coming into the Fire Service when the wage is way below the national average wage?

Mr. Prior

Let me follow what the hon. Gentleman says by pointing out that there are a lot of skilled people in Britain at the moment but a great many skilled people have chosen to do unskilled jobs. They may choose to do unskilled jobs because of the problem of differentials. The whole question of differentials and their restoration has made it not worth while doing a skilled job. Secondly, they may perhaps do an easier job, finish work at an easier time, and go off and do a bit of moonlighting elsewhere.

Once again, there is no point in training vast numbers of people if they are not later on to be rewarded for the training they have undertaken. That is another matter which we have to put right.

My next point concerns more help for small businesses. Hon. Members on the Government side have a lot to answer for here in the way that they introduced the Employment Protection Act. We warned them time and again, while the Bill was going through the House, that the Employment Protection Act might well be a measure which, introduced at the right time, would be satisfactory for employers and employees. But that, introduced at the psychologically wrong time, when unemployment was already rising rapidly, it would have totally the wrong effect.

I do not know whether the figures of 30,000 or 100,000—which one hears bandied around as being the figures of jobs which could be taken up but which are not being taken up because small businesses are refusing to employ extra people—are correct. But I do know that every small business man in the country believes that the Employment Protection Act is now an Act stopping him from taking on additional labour because he does not know what the future holds. I know that the Government are now carrying out a survey into the effects of the Employment Protection Act, but they ought to realise the psychological damage that that Act has done to the employment of additional people.

What is important? Is it important now that we should preserve the jobs of those who are in employment, or is it important that we create additional jobs? I am certain that, over the next few years. it is to the small businesses that we shall have to look if we are to get unemployment down to the levels that we all wish to see.

It is not good enough for hon. Gentlemen to sit on the Back Benches and jeer when one talks about the problems that the Employment Protection Act is creating. They must know from personal experience the views of small business men and the attitudes that they are adopting. Hon. Gentlemen opposite have to show whether they are more interested in keeping on the statute book an Act which affects small businesses and is believed to reduce employment or in getting unemployment down to the levels that we wish to see it reach.

I turn now to tax incentives. I have already mentioned the many people who do not think it now worth training or doing a skilled job because of the lack of differentials, but I also believe that there are a great many people who, if tax was very much reduced, would be content to do just one job and not go off moonlighting every night. If we got tax reduced dramatically, not only would that have a remarkable effect on the economy as a whole, but it might lead to people being more content to take just one job, so that there would be many other jobs available for others to do. Therefore, I believe that reductions in taxe are probably one of—

Mr. Thomas Swain (Derbyshire, North-East)

Will the right hon. Gentleman give way?

Mr. Prior

No, I will not. I have already given way a great deal. I am trying to obey Mr. Deputy Speaker's instructions.

It would be far better if we could get taxation down so that there was a real incentive to work.

I point out also that in the MSC book to which I have already referred there is a figure which shows that for the first six months of unemployment the cost to the Government is greater than the cost of a person at work. That is no way to solve our problems. We have to make a difference, a gap, between what people can earn if they are doing a job and what they receive when unemployed.

It is not much good the Government's talking about putting £900 million into job creation, temporary employment subsidies and all the other things they have done if at the same time they put an extra 2 per cent. on the national insurance contribution for employers. The one adds up to the other. All that happens is that if they take that amount of money out of employers' pockets there is that much less money to provide jobs in the private sector. Let us face it. That is where the jobs must come from—the private sector, not the public sector.

We have to create a climate of confidence. One of the first things we have to do is stop constantly saying that improvements in unemployment figures are just round the corner, that we are on our way, that the situation will get better. It would have been more truthful if the Government had admitted the real seriousness of the problem three years ago and had started then to do something about it.

We have had so many false dawns, so much faded optimism, that it would be better to admit that there is a long hard struggle ahead. We have to create a climate and a feeling of confidence in which industry is prepared to expand and invest. I say to hon. Members, particularly to members of the Tribune Group, that when Mr. Kitson goes to Moscow and makes the sort of statements that he made, he does irreparable damage to future employment prospects in Britain.

Mr. Swain

What about the Leader of the Opposition in America?

Mr. Prior

Mr. Kitson is an extreme Left-winger, anyhow Anything that detracts from people having confidence in us is damaging to employment in Britain.

When I was in Washington one of the things I had repeated to me time and time again was that Ministers—and not only Ministers—had gone to Washington and told Government officials and Congressmen that if a Conservative Government were elected there would be industrial chaos in Britain. Some hon. Members do not mind about running the country down. I dare say that if the hon. Gentleman went now he would get a different reception from that of a few months ago.

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

I do not know where the right hon. Gentleman got his information about Ministers going over and saying such things. What were much more important were the remarks of the right hon. Lady the Leader of the Opposition in New York and whether they were calculated to inspire confidence in this country.

Mr. Prior

My right hon. Friends remarks were absolutely to the point and stressed the need for support of the free enterprise and private enterprise system in Britain. That is what hon. Members opposite have to do as well. They may not like the private enterprise system, but there will not be jobs unless they support it. The sooner they get that message, the better.

When the Prime Minister and his right hon. Friends ask for our support, as they did earlier this afternoon, I wonder what the atmosphere would have been like if the roles had been reversed—if a Conservative Home Secretary were standing at the Dispatch Box talking about the Fire Service in the way the Home Secretary did this afternoon. Have they ever thought—do their consciences prick them —about the attitude they took when we were in Government? If they had had a bit more sense and a bit more responsibility then, we might not have had the four wasted shameful years that we have experienced since then.

When the Prime Minister calls for a national effort and for everyone in the country to stand firm with the Government—[Interruption.] Let us all stand firm with the Government, but let the Government, first of all, show that they deserve the confidence of the House and of the country. They have done nothing yet to deserve it.

Mr. Deputy Speaker

May I ask, does the right hon. Gentleman wish to move the amendment?

Mr. Prior

You, Mr. Deputy Speaker, were not in the Chair at the time. I moved it at the beginning of my speech.

Mr. Deputy Speaker

I apologise to the right hon. Gentleman. I was given to understand just a few moments ago that it had not been moved. I was just inquiring.

4.56 p.m.

The Secretary of State for Employment (Mr. Albert Booth)

The improvement in our country's financial position that has become apparent this year will not automatically solve our massive unemployment problem, but it will provide us with the greatly needed scope for action. Without the improvement that would have been denied us.

While many factors combine to create the current appalling level of unemployment and— some of these are international—the Government can take a number of steps to reduce unemployment. That should be the prime aim of our economic policy. Working in the difficult setting of the world's worst recession since the 1930s we must, if we are soundly to base a major reduction in unemployment, raise the general level of efficiency of British industry to the level of its best parts. We should recognise that there are many parts of British industry which are good and competitive even in the present tough world conditions.

I believe that this is crucial for us as a trading nation, competing as we are with the efficient industries of the United States, Japan and West Germany. What is more, we must do it without refuelling inflation. The methods by which we choose to do it will have to take into account the fact that the size of this country's labour force is currently increasing by about 140,000 a year. It will continue to do so for some years.

The growth of our labour force is such that we shall require about 1,400,000 extra jobs by 198] in order to bring down unemployment by 600,000. That means—it is no use blinking the fact—that unemployment will not come down as quickly as we had once hoped, although in many ways the prospects have improved. The benefits of North Sea oil are beginning to flow. The pound is strong. The inflation rate is coming down. This has made it possible to start stimulating the economy, and we must continue to do that in a responsible way.

We have chosen an industrial strategy as our principal means of raising the efficiency of British industry. The National Economic Development Council is working out detailed plans at industrial level in full partnership with employers and unions concerned. We are doing all we can through what is probably the most generous system of financial support for investment in the Western world. When the right hon. Member for Lowestoft (Mr. Prior) seeks to condemn us for failing to create confidence in industry, he takes little account of the fact that the Government have shown confidence in the organised workers of this country, in the employers and the managers, by determining to back the assessment that those managers and trade unions have made of the ability of their industries to expand in the tough world conditions that now exist. That is the very point that lies behind the support that my right hon. Friend the Secretary of State for Industry and I have given to the sector working party reports that have been produced under this industrial strategy. They have the confidence of a Government behind them, which few other industries anywhere in the world can claim.

I am often told that since the aim of investment must be higher productivity, this can only lead to higher and not lower levels of unemployment. I do not subscribe to this view. If industry is to be more competitive, the demand for its products will grow and that in itself will create employment—not necessarily employment within that industry.

It may be that the industries which become more capital-intensive and productive will be able to produce much more without increasing, and possibly by reducing, their own labour forces. But what they will do in many cases is to provide additional work for people who supply these industries with raw materials and distribute the products. Also, without a shadow of a doubt they will increase the amount of work in construction, plant and buildings which they will require more and more.

Mr. Tom Litterick (Birmingham, Selly Oak)

The point that the Secretary of State is making is crucially important. I want to believe him, but I am afraid that I have some doubts and misgivings about the future. Can he give us an assurance that some work has been done on this, that there is a model, or at least a good reason for believing it, and that it is not just the personal opinion of the Secretary of State? Can he assure us that the results of a given quota of investment in industry will be positive in terms of employment?

Mr. Booth

We have no model to fit every industry. We have studied this very carefully, and I shall give one example of what we have found by study. Looking at the chemical industry, where there is considerable investment, we have found that there is one major firm in which investment amounting to £1 million per working day has taken place. That industry is slightly increasing its work force but it is undoubtedly creating much more work in the construction and plant industries. [An HON. MEMBER : "That is only temporary."] Certainly it is temporary in this case, but if one looks at a major oil refinery, for example, or a large volume plant in the chemical industry, one sees that it is obvious that the ratio of construction to operating work is very high indeed. Therefore, we could find that there are a number of industries in which the total amount of employment is dependent to a considerable degree on the level of investment and the rate at which plant is being replaced.

The wealth created by these capital-intensive industries is itself necessary in order to enable us to bring about an effective demand for services in this country. It may be that the toughest political question that we shall have to face in our lifetime is how we are to distribute the wealth that has been created in a way which provides a demand for services. But that question will be hypothetical if we do not create the wealth.

Dr. Jeremy Bray (Motherwell and Wishaw)

I hope that the Secretary of State will give a lot more thought to this question and to what he said when my hon. Friend the Member for Birmingham, Selly Oak (Mr. Litterick) drew attention to the fact that investment does not increase employment overall. In the long term—this was a point made by the right hon. Member for Lowestoft (Mr. Prior)—this is the major problem, which the Government have not fully penetrated. I hope that the Secretary of State will look carefully at the mechanism for transferring from manufacturing to service industries, and particularly the implications of that for public expenditure.

Mr. Booth

I can give the assurance that my hon. Friend seeks, that we shall give a lot more thought to this matter. We have given it a lot of thought already.

The time scale is important. In the next three, four or five years there is no doubt that we shall need to increase the output of manufacturing industry. Simultaneously, we must examine the implications of becoming more capital-intensive and the way to fund services in order to provide jobs. We must also examine ways in which privately provided services also can grow in order to absorb some of the wealth created by these industries. In that lies part of the solution to the unemployment problem.

In the meantime, we must devise numerous schemes for the relief of unemployment. It is no good saying that such schemes do not have a part to play. We know that they are extremely good value for money and that they are more labour-intensive than anything else we have in this country. Jobs have been saved by the temporary employment subsidy and the small firms employment subsidy.

If the right hon. Member for Lowestoft wants to examine a case of Government aid to small firms, he should talk to those small business men that I talked to in Cumbria a few Saturdays ago who have had the chance to expand as a result of help being given by this Government. There is also the youth employment subsidy and the job release scheme. I believe that the Manpower Services Commission, helped by the careers service, working with us on the work experience programme, has made an important contribution to the development of a series of means of tackling the depth of the present recession.

Between them these schemes have already helped 300,000 people a year—people who otherwise would have been unemployed. Currently we are putting more than £400 million a year into running these schemes.

In a situation in which expansion of demand can proceed only slowly these schemes have an invaluable rôle to play. They are quick-acting and cheap in terms of jobs produced per pound spent. It should be remembered that we have been ready to experiment with anything offering a hope of reducing unemployment in this way, during a time when severe constraints have been imposed on public expenditure.

In December last year many Departments' budgets were restricted. Notwithstanding that fact, the budgets of the Department of Industry and my Department were increased at a time when it was accepted by most Ministers that they would have a curtailment in their Department's expenditure. That change was a recognition of the fact that the Government are giving major priority to solving problems of unemployment.

I have already announced that the Manpower Services Commission will introduce a youth opportunities programme in which 230,000 young people will be helped, in the first full year into training and work experience that is structured to their needs over the next four or five years. The Commission will be running a complementary programme to provide jobs for 25,000 adults. The arrangements are being worked out for implementing the programme.

There have been very misleading reports in the Press recently to the effect that there have been differences of opinion between Ministers and the Commission about the arrangements. There have been allegations—I am sorry that the right hon. Member for Lowestoft appeared to support them—that the programmes will be run by civil servants and that those concerned with the problems of youth unemployment, as well as those in a position to help in a practical way, will not be involved. None of this is true.

Mr. Priorindicated dissent.

Mr. Booth

Perhaps I have done the right hon. Gentleman an injustice. I had taken his remarks as a criticism that too many civil servants would be involved. If he did not imply that, I am only too pleased to hear it. None of the allegations that have appeared in the Press over the last week is true. The detailed arrangements have not yet been decided.

My right hon. Friend the Secretary of State for Education and Science and I have been discussing them fully with the Manpower Services Commission, and I can assure the House that there is no quarrel between us and the Commission. Far from the programme being run by bureaucrats, it will, if the proposals of the Commission are accepted by the Government, be administered by a network of area boards, comprising representatives of employers, trade unions, local authorities and voluntary organisations. These will all be represented on the boards. This proposal, incidentally, was included in the consultative document which was circulated by the Commission, so that there is little excuse for misrepresentation.

Mr. Esmond Bulmer

(Kidderminster): Before the Secretary of State leaves the subject of the Commission, will he say how long it will be before it receives worthwhile employment prospects from the sector working parties?

Mr. Booth

I cannot give a direct answer to that question. I can say that to some extent the Commission already takes cognisance of the fact that many of the sector working party reports and the proposals contained in them are already being backed by my own Department, and more especially by the Department of Industry, which has used discretionary power to support industry in a way which underpins the plans of the sector working parties.

Mr. Anthony Steen (Liverpool, Wavertree)

The Secretary of State was saying, in regard to the composition of the boards, that the people who are on the job creation action committees will also be on the area boards. Will he insist that some young people are put on these area boards?

Mr. Booth

I was not yet proposing to leave this aspect of the Commission's activities, and I assure the hon. Gentleman that I shall answer him on this point. I believe that these area boards will have to work in very close co-operation with the careers services. In the discussion that my right hon. Friend the Secretary of State for Education and Science and I had with the Commission the other day, we discussed a proposition that would ensure that the careers services are represented at all meetings of boards. The boards will be under instructions to allocate money, with which they will be provided, to areas, in proportion to the size of local youth unemployment. There will be no discretion in the hands of the boards on that point; therefore there can be no question of any area getting less than its fair share as judged by the extent of that area's youth unemployment problems. There will be flexible arrangements for representation of local authorities on the boards. I believe that this is also of some concern to the House.

The number of civil servants involved in the programme will be limited to those required to service the boards and their liaison with other committees. At this stage I am not certain about the total number of civil servants involved. It depends partly on the number of boards. There may well be between 600 and 800 involved in the whole of the scheme, but these will be very largely people who are already involved in job creation and work experience administration.

A most significant increase in employment, as a result of the youth opportunities programme, will arise from our proposal for the special temporary employment programme to provide jobs for 8,000 unemployed men and women as supervisors and instructors working within the youth opportunities programme. If anyone chooses to regard them as temporary civil servants, we shall have an increase in the Civil Service. I do not regard them as such, but as people who can use skills and talents, which would otherwise be wasted, in the interests of providing unemployed young people in this country with opportunities and chances of getting employment which could not be brought about in any other way.

Mr. Ian Lloyd (Havant and Waterloo)

In dealing with the Manpower Services Commission, the Secretary of State said that he regards the expenditure as highly efficient, in that a large number of jobs will be created by a comparatively small expenditure of money. I have the latest report of the Commission. Surprisingly, it was not available to the House this afternoon and had to be specially sent for. None the less, the figure given here for the estimated Commission expenditure for the year 1977–78 is a total of £580 million. The figure for the management of the Commission alone is about £45 million. These are very large sums, and I should like the assurance that very considerable employment is being created by this expenditure.

Mr. Booth

When I was talking about efficient expenditure and good value for money I was referring to the money expended on the special employment measures. The figure that the hon. Gentleman is quoting, if I understand his point correctly, is the total expenditure on administration of the Commission, and that goes very much wider than the special employment measures. The administrative expenditure of the Commission now covers the whole cost of running the Training Services Agency and the Employment Services Agency—in other words, a very large part of what previously would have been held to be the administrative costs of the Department of Employment.

I return to the question of the way in which the youth opportunities programme will be run. This is the problem on which we are now working. Below the level of the boards, the Manpower Services Commission will be stimulating the formation of a whole series of local committees. There will be many of these in each board area. These local committees will be necessary to provide a forum and an arena in which many people who have a contribution to make and a part to play can take part. Many people must be concerned with this if it is to be successful. Employers are essential for providing industry-based work experience, and local authorities for providing some of the project-based work experience which is an essential part of the programme. Both of these efforts are being made in cooperation with the trade unions. The organisations concerned include those of young people. In the committees we shall want to see young people with ideas that we can adopt. We also need representatives of educational bodies such as colleges of further education, which have an essential contribution to make. I also believe that local education authority careers services have an essential contribution to make.

The question posed by the right hon. Member for Lowestoft is a very fair one. How do we ensure accountability for the money which is to be spent on the youth opportunities programme without involving some great bureaucracy? I think that the ideas on which we are now working provide a large part of the answer to this question. The area boards that will be responsible for approving the programmes—the powers will be devolved to them—will be comprised of people who are representative, in the truest sense, of the community in the board area. The people who will be responsible for putting up the project to them will be people who are representative of their own local communities. In other words, the people who are involved in the programme will themselves determine the accountability in the sense of how the programme is carried out. The amounts allocated, for which I shall be answerable to this House will be in direct proportion to the youth unemployment problems of the particular areas.

Mr. Prior

May I say what I was trying to get across to the House? Because of the need to account for every single penny, there is always a tendency to set up a bureaucracy. In a number of countries this is not done. If anything goes wrong here, the Minister is accountable for it. I believe that the more these schemes are devolved to the people who are really affected by them the better the schemes will be. On the other hand, I accept that there will be greater dangers of something going wrong. I think that a number of things will go wrong. There might even be the odd scandal or two. But we have to get this into perspective, and I do not think that we do this in the House of Commons. That is what worries me very much about all these schemes. That is the point I was trying to make. That is why I think that Richard O'Brien, for whom I have the greatest respect, feels that he is tied somewhat in having to have a bureaucratic set-up—I do not say that it is all that bureaucratic, but there is a degree of bureaucracy—in order to avoid the kind of thing to which I have referred.

Mr. Booth

I do not know that Richard O'Brien would use exactly those words, but if he has implied that there is any bureaucracy, he may have in mind the way in which he has to run the Training Services Agency and the Employment Services Agency. I do not think that anyone could claim that work experience, job creation and similar projects have a bureaucratic administration. If anything, we have gambled with some of them. I regret that some of them have failed, but 90 per cent. of them have been successful, and it is on that ground that I defend the programme before the House.

Mr. Timothy Raison (Aylesbury)

am worried about the nature of the jobs involved. I am not talking of scandals, freaks and abuses, which will always crop up. The bulk of the work involved is low priority such as environmental schemes. Those are useful schemes but, at the same time, essential services—for example, at the Stoke Mandeville Hospital—have had to be cut. Is there a way of ensuring that the work is directed towards essential services rather than merely desirable or optional services?

Mr. Booth

There are differences between the job creation scheme and the youth opportunities programme. For example, in the youth opportunities programme each project must provide the means of training young people in work skills. They must, therefore, be projects producing something that is worth while. That is why it is a more challenging concept than the job creation programme.

I cannot emphasise too much how impressed I am with the trend of these developments. I have been impressed by the people to whom I have spoken, who are working at area levels to create circumstances that are right for the youth opportunities programme. They are people who are determined to make a success of the programme. I am always ready to listen to their criticisms and suggestions. However, I deplore the ill-informed criticism based upon half knowledge that has been purveyed by some sections of the Press in the past week. This does not help to reduce the number of unemployed young people, which is the real problem.

Mr. Ron Thomas (Bristol, North-West)

My right hon. Friend is spending a lot of time on the mechanics of this scheme. Can he answer a straightforward question? How many youngsters left school to join the dole queues because of cuts in public expenditure?

Mr. Booth

I have spent a lot of time on the mechanics of the scheme and on answering hon. Members' questions. I cannot give a precise estimate of how many youngsters left school to join the dole queues. That is because in many cases cuts in public expenditure were made in such a way as to protect those employed in the public sector. These protections created other difficulties.

I return to my main theme. In the Manpower Services Commission and its two agencies we have an efficient body not only for helping us with the problems of present-day unemployment but for paving the way to ensuring that we have adequate supplies of trained labour which we shall need for expansion in the future as we move out of the recession.

We have broadly mentioned the intake of apprentices into industry. It is a unique achievement in a recession, because in some cases we have not only retained the level but increased it. For example, in the engineering and foundry industries there are now more young people entering apprenticeships than there were in 1972–73. The number of apprentices in the engineering industry was fewer than 17,000 in 1972–73. In 1976–77 the number rose to 25,000. The House should realise that 20 per cent. of those recruited in 1976–77 were recruited with the aid of premium grants and training awards that were paid for by the taxpayers through the industrial training boards. The ability to sustain and increase the intake of young people depends upon policies that must be determined by the House.

The right hon. Member for Lowestoft will agree that a decision to expand a work force or to build a new factory is determined to a consideable extent by the availability of skilled manpower in the area where the factory is sited or to be built. It is, therefore, important that we act now to provide training opportunities for young people who are leaving school in increasing numbers. It is also necessary to ensure that we have an adequate skilled labour force in the early 1980s.

There is no current general skill shortage problem. In a few areas there is a shortage of new craftsmen to replace those who retire or leave an industry, but this is the result of the reduction in the number trained in 1972–73. In a recession we must be more careful about this. There is a natural and understandable tendency for those running industry to cut down their training intake when they are up against cash flow problems. We have been working out proposals with the Manpower Services Commission and industrial training boards to ensure that there is an adequate supply of skilled labour in the long term to meet the needs of our essential industries and services. We have been working out how Government support for training can be deployed to ensure that the long-term needs for training are met.

Mr. Jim Craigen (Glasgow, Maryhill)

Has my right hon. Friend come across any evidence, as I have, that some employers are discriminating against youngsters and prefer to recruit older workers?.

Mr. Booth

I have some evidence to that effect. It is part of a wider problem that effects young people who are not involved in apprenticeships. Leaving aside the apprenticeship question, employers do ask potential applicants about their previous experience and acquired skills. Those questions will militate against the young job applicant and favour the older. That is yet another reason why we must he careful when working out the scope of the youth opportunities programme. If we are not careful we may create I million new jobs without having an impact on youth unemployment.

Mrs. Kellett-Bowman

Does the Secretary of State agree that we have to some extent exacerbated the problem of youth unemployment by raising the school leaving age, because the gap between leaving school and the expectation of full pay has narrowed?

Mr. Booth

The raising of the school leaving age has two effects upon unemployment. First, it results in young people expecting higher pay from their first jobs. Secondly, young people arc probably better educated and many have the qualifications that employers are seeking. The overall effect of the raising of the school leaving age has been helpful to employment. For two years young people who might otherwise have been unemployed were taken out of the labour market.

Proposals to deal with how Government support can meet the long-term needs of industry are shortly to be discussed between myself and other Ministers. I hope to be able to make a statement to the House before Christmas.

Mr. Wyn Roberts (Conway)

I am grateful to the right hon. Gentleman; he has been very kind in giving way. In these discussions with other Ministers will he pay particular attention to the position of newly-qualified teachers who cannot get jobs and who cannot get grants for retraining unless they have had a job and been declared redundant?

Mr. Booth

I shall certainly bear that in mind. Indeed, it is a subject that I am discussing with my right hon. Friend the Secretary of State for Education and Science in another context.

I have already announced to the House 1,500 extra places for community industry which, with its new, closer relationship with the MSC, will play its part as one element of manpower policy. About 1,100 of these places have been allocated to 27 of the 42 existing community industry units. Prominent among them are units serving inner city areas.

I must tell the House that although the scheme had employed about 4,500 youngsters by mid-October, and should be providing 5,000 places by the end of the year, I do not see it as a recession measure. There is a lot of evidence now that the special service that community industry can provide to meet a particular problem of a minority group of young people may well be one that we shall need on a longer-term basis. I hope the House will agree that we have been right to give priority to the development of the manpower programme. We may have differences about the relative values of various programmes, but I hope that the House will back the priority for the manpower programme.

Employment levels are not determined by Government measures alone. Many policies are being developed and many decisions are being taken in industry by boards of management and in collective bargaining which bear upon the level of employment. The working out of schemes for early retirement is one example, and the decision whether to move from a single shift to a two-shift system, or even to continuous working, is another example of decisions which have a considerable bearing on the level of employment. There is also the decision whether to work overtime, sometimes on a massive scale. That, too, has a considerable bearing on the level of employment. A recent count made by my Department of overtime working in a single week in manufacturing industry alone showed that 16 million hours of overtime were worked.

I do not suppose that it would be possible to reorganise those industries to share out the whole of the 16 million hours into full-time work, but I suggest that it is not beyond the ingenuity of management and unions to reflect some of it in a higher level of employment.

Mr. George Rodgers (Chorley)

Does my right hon. Friend accept that overtime has often become institutionalised as a consequence of poor basic rates of pay? Does he recognise that people are often trapped in the present circumstances of the Pay Code, and that there is very little that can be achieved in that direction?

Mr. Booth

I accept the point that pressures of low pay and the strict limitations of two years of pay policy have added to the pressures to work overtime in many cases. I also take the point that it tends to become institutionalised. That is another reason why we should take a careful look at the effect on total levels of employment and unemployment.

Dr. Bray

Perhaps there is a danger of getting the overtime problem out of scale. On a rough, quick calculation, it seems to me that 16 million hours of overtime must have been about 1 per cent. of the total time worked.

Mr. Booth

My hon. Friend is making the wrong division, which is untypical of most of his calculations, which are usually precise. The figure was for manufacturing industry's total work force alone. If one added overtime in the service industries there would be a very much higher figure.

As collective bargaining rights extend into manning policy, responsibility for determining these factors and the opportunity to determine them will move more into an area in which it is shared between management and representatives of the organised workers. I believe that the proper discharge of that responsibility now requires an appreciation of the complex long-term nature of the unemployment problem.

Mr. David Mudd (Falmouth and Camborne)

The right hon. Gentleman shares my personal concern for the particular problem of unemployment in West Cornwall in what he has said and failed to say. Is he now saying that I can usefully tell the 12 per cent. who are unemployed in my constituency that by Christmas 1977, by Easter 1978, or by the early 1980s they can look forward to a sizeable reduction in the scourge of unemployment blighting West Cornwall?

Mr. Booth

What I am saying is that the hon. Gentleman can go back not only to his constituency but to the whole South-West Region and say that the policies operating there have ensured that there are more jobs available in the region than when this Government took office, and that under the youth opportunities programme it should be possible to ensure that every youngster who leaves school in the area next year and does not find ordinary employment will get the chance to return either to full-time further education or to a place created by the job creation programme, which will give him work experience. I would like to give the hon. Gentleman further assurance he asks for, but it would be dishonest of me to do so at this stage. But I stand by the assurance that I have given.

I claim that all of those who have a part to play in determining employment levels now have to appreciate, as the Government and the House must appreciate, that the level of employment is a long-term, serious and complex problem; that opportunities now exist for this country to expand—opportunities that we could not see as short a time ago as last November and December; that we are stimulating investment and running programmes which mean that 300,000 people a year who would otherwise be unemployed have work; that we are developing training for today's youth and for tomorow's industry and services; and that the youth opportunities programme offers that range of assurance that I have just indicated.

I believe it inevitable and right that unemployment is and must be a matter of political controversy. It is also a problem so great that I believe that it behoves us all, as far as we can, sincerely to try to extend the area of agreement in which we can work together to provide the jobs and the benefits that can flow from them.

5.38 p.m.

Mr. David Steel (Roxburgh, Selkirk and Peebles)

This has been, rightly, a serious debate. I welcome the approach of the right hon. Member for Lowestoft (Mr. Prior) to the subject, with his reference to the responsibility of Parliament as a whole. He put forward a number of quite attractive proposals about unemployment, which merit serious study. But I think that the debate would have been a great deal better without the unnecessary Conservative amendment to which it has been attached, and I think that the right hon. Gentleman was right to address himself scarcely at all to it. Nevertheless, it is on the Order Paper and I must address myself to it, at least, before I turn to the general question of unemployment.

The amendment regrets that the Gracious Speech contains no proposals for creating long-term business confidence …". One has to compare what is being said in the country now with what was being said by the Conservative Opposition in the "no confidence" debate of 23rd March. I looked up Hansard for that day, and I take three quotations from it. The first is from the right hon. Lady the Leader of the Opposition, who said: Unless there is a General Election following, we shall go into a period of very great uncertainty. Later, she said: The fact is that this is a broken-backed Government.‖". The right hon. Member for Cambridgeshire (Mr. Pym) argued: We are saying that the useful life of this Parliament is ended ".—[Official Report, 23rd March 1977; Vol. 928, c. 1285–393.]

That is what they were saying in March. I believe that all the facts since then have proved the Conservatives to be wrong. Moreover, in their more honest moments they accept that they were wrongUnterrirptioni—[Interruption]or perhaps in their more sober moments.

Mr. Prior

Empty barrels make the most noise.

Mr. Steel

In that case the right hon. Member for Lowestoft should shut up. The Conservatives, in accepting that there has been a turn round, seek to attribute the credit to the International Monetary Fund and North Sea oil. The fact is that the IMF had been around us for six months when those statements were made in March, and so had the predictions about the effects of North Sea oil on our economy. Both of those matters have been extremely important.

Confidence has certainly improved since March. Measured by the Financial Times share index, it has gone up by 100 points. The pound has risen steadily month by month after months of decline. The balance of payments deficit has been turned into a satisfactory surplus. The reserves are up by £3 billion. The minimum lending rate has gone down from l0½ per cent. to 6 per cent. Mortgage interest rate has gone down from 12¼ per cent. to 9½ per cent. Today we have the news that the Price Commission index has gone down from the record figure of 20.9 per cent. in March to 7.3 per cent. in the last month. I believe that the success in reducing the rate of inflation has done more than anything else to lift confidence in Britain both at home and abroad. It is the view of myself and my colleagues that we are right to continue on that road and make it a high priority.

I accept that against that background of success we have the horror of the unemployment figures, but I think that anyone who is honest will accept that unemployment, which is widespread and fairly general in the industrialised West, is likely to remain with us, sadly, until we get a general reflation in the industrial world, much of which is outside the control of any Government in this country, whether Labour or Conservative. I welcome the proposals put forward by the Conservative Opposition this afternoon. I believe that it is absolutely right that, within the parliamentary framework, we should bend our minds to mitigating the worst effects of unemployment and looking at ways to reduce the overall international effects. I welcome what has been announced by the Government in the last few days to help the construction industry, although I should have liked them. A great deal more employment could be provided in the construction industry if we had a boost to the programme of home improvements of the kind that we had a few years ago.

In particular, we could usefully combine this with conservation measures. If we could give a stimulus, for example, to home insulation, it would be of lasting benefit to the country in terms of the energy crisis and of reducing employment. I think that there is scope for going further than the Government have already gone in providing employment in the construction industry.

I welcome what the Secretary of State said about unemployment among teachers. The right hon. Gentleman assured us that he was still talking to his right hon. Friend the Secretary of State for Education and Science. Since he indicated that publicly, and since we have been urging them to do more than talk, I find it almost incredible to use the job creation programme to pay teachers to sweep public parks rather than to get over the bureaucratic difficulties between the two Departments and pay them to complete their probationary year and therefore add to the quality of education.

Mr. Booth

I think that the right hon. Gentleman would wish to present a fair picture to the House. We have done a little more than talk. We have agreed and put into practice the means whereby teachers who have been trained in specialisations for which there are no vacancies can be retrained in specialisations in which there are vacancies, and thereby obtain jobs.

Mr. Steel

I accept that and welcome the steps that have been taken. I am urging that the talks to which the Secretary of State has referred should come to fruition and that we should be able to use the job creation programme to help teachers who are waiting to do their probationary year but cannot do it because jobs are not available.

Mr. Stephen Ross (Isle of Wight)

Is my right hon. Friend aware that teachers who wish to retrain into other professions, such as secretarial courses, are having difficulty in obtaining grants from local authorities to enable them to do so? That is another problem that they face.

Mr. Steel

That is the sort of issue that the two Secretaries of State must resolve.

I turn now to the most serious aspect of unemployment, youth unemployment, which I regard as little short of a disaster at present. In our major cities as many as one in four of our 16- to 18-year olds are unemployed. The figure is more serious among the young coloured population. That is a very serious social factor, which the House should consider. Over recent years—not just in the last few months—unemployment has risen three times as fast among young people as among the population as a whole. One point on which I disagree with the Secretary of State is that, in parallel with these appalling figures of youth unemployment, there is growing evidence of a potential shortage of skilled labour. The right hon. Gentleman disagrees with that.

There is considerable evidence in the NEDO report showing that the number of people entering training for skilled occupations has been falling and is not keeping pace with demand. In the two years 1972–73 and 1973–74 the total number of craft trainees, mainly apprentices, who started training fell to little more than half the number in 1967–71. I know that the figures have gone up since then, but the effect of that loss in these years means that the out-turn of apprentices coming out of their time in 1977 and 1978 will be barely sufficient to fill vacancies from promotion, let alone losses from other causes.

There can be little doubt that when the economy begins to recover—if we accept the Chancellor of the Exchequer's optimism in the Budget—there will be a shortage of skilled men and women, and these shortages will hold up economic recovery, as has happened in the past. There is a real danger that it could happen again. I do not think that it can be assumed that the recovery will open up opportunities for the unskilled. The evidence in this country and in the EEC makes it clear that the incidence of unemployment continues to rise as the level of skill in the population diminishes.

I accept that many of the technical changes taking place in industry make it highly probable that there will never again be the number of jobs for the unskilled that there has been in the past. We face the prospect that the recession could pass and the recovery could come, leaving behind us an appalling residue of youngsters with no prospects of ever obtaining continuous employment. We already have too many unskilled youngsters who are in danger of becoming a legion of the lost unless we take action now. That is why I am concerned that, among school leavers, only about one-third of the boys and less than 10 per cent. of the girls receive skilled apprenticeships, and our figures for day release and part-time training show a steady fall.

Since 1971 the figures for England and Wales show that the total number of students released for part-time training has fallen from 587,000 to 540,000. The shortfall in the number of young apprentices training to become skilled men can have dramatic effects. It is true that in future many shortages will arise from the absence of one skilled man. The absence of that man can prevent the employment of several lesser-skilled workers. For example, the lack of one machine-tool setter could prevent the employment of several machine-tool operatives.

We are lagging sadly behind our partners in Europe. In West Germany all young people who are not proceeding to higher education are subject to statutory release for three years to attend a regulated course completed by an examination, which counts as a vocational qualification. More needs to be done than the plan that the Secretary of State announced to create the necessary skill centres and opportunities for people to go into more training.

It is not just a question of leaving it all to the Government. A great deal could be done by industry throughout the country working in collaboration with technical and further education colleges and putting up proposals for engaging four youngsters for every three or even two jobs and releasing them for compulsory further education and training for perhaps one and a half or two days a week.

The Secretary of State knows that we have put to him a proposal for an all-party campaign on this matter and that we should try to persuade employers to take on more young people. I hope that we shall get that campaign launched and that the right hon. Member for Lowestoft will join us in our efforts. This is of crucial importance.

I think that I have said enough about youth unemployment. There are two or three other matters that I should like to comment upon before I conclude.

A great contribution can be made to the creation of new jobs by the small business and self-employed sector. We have talked about this often enough, and I wish to register with the Government my appreciation for the fact that they responded so quickly to our suggestion that there should be a cross-departmental review of this matter which affects not just one Government Department.

The Chancellor of the Duchy of Lancaster has acted speedily and has started to restore confidence in this important sector. The Queen's Speech foreshadows still further measures that we welcome. We have suffered a terrible decline in the number of small businesses and if we can encourage small and new businesses by looking at their problems in this global way, by every Department considering them, and by looking at the legislation and tax burdens that have acted as a disincentive, we can create employment.

In terms of creating long-term confidence, it is right that there should be further shifts in the burden of taxation on income. The Chancellor of the Exchequer has made a welcome first step in this direction in his Budget and I hope that we shall see more in his next Budget in April.

This is not the time to go into details on this point, but the introduction of profit-sharing incentives, which have again been foreshadowed in the Queen's Speech, could also be crucial in creating a new spirit of harmony and partnership in industry that will lead, in the long run, to greater productivity and more employment.

Returning to the terms of the amendment, I believe that a basic political change is needed if we are to restore business confidence in the long term. My argument is that we have succeeded in restoring short-term business confidence in the past six months, but that, in the long run, changes of a more fundamental nature are required.

In our confidence debate in March, the Leader of the Opposition asked the Government by what right they governed. She referred to the right of a supposed mandate based on 38 per cent. of the votes cast or 29 per cent. of the electorate? They goven by no right except the arrogant right of Socialism. There is no difference in the constitutional position of a Socialist Government elected by 29 per cent. of the electorate and a Conservative Government elected by 33 per cent. of the electorate. The right hon. Lady should follow through the logic of what she said and agree that changes to the electoral system are needed in order to ensure that we get a Government that is representative of the people.

Winding up in that debate, the right hon. Member for Cambridgeshire said: Britain wants government which is inherently strong and responsive to the people's wishes. I agree. That is what we have at the moment, and in support of that view I cite last week's Gallup Poll, which showed that, for the first time, 50 per cent. of people believe that the Lib-Lab agreement is good for the country, as opposed to 35 per cent. who do not.

In the long term, we need to change our electoral system. If I may be so immodest as to quote one sentence from my speech in the same debate, I said: It is my belief that it is possible that people will get to like the taste of co-operation and want more."—[Official Report, 23rd March 1977; Vol. 928, cc. 1285–319.]

The evidence is that I was right.

Winding up last night's debate, the hon. Member for St. Ives (Mr. Nott), in a witty and lengthy metaphor about the military posture of the Prime Minister, said: If the Leader of the Liberal Party believes that he is holding back the hordes of advancing Socialism he misunderstands his rôle. To the rest of us he is simply the caretaker engaged on a temporary basis by the Prime Minister to keep the barracks clean until the drunken rabble arrive back from their leave to plunder our liberty and prosperity—and every liberal principle—should they win the next election. That is how we see it."—[Official Report, 8th November 1977; Vol. 938, cc. 609–10.]

That was rather good, but I do not see it in that way. I see our task as being to keep going the recovery on which we have embarked in the last six months by ensuring not only that the drunken rabble are kept at bay but that the barracks are not abandoned altogether to raids by the Tory mercenaries lurking round the corner, under the command of the right hon. Member for Leeds, North-East (Sir K. Joseph), and waiting to demolish the entire edifice.

I wish to place on the record my thanks to the Prime Minister for his recognition, in his opening speech in this debate last week, of the part that we have played in producing the political stability against which a start towards economic recovery can be made. We believe that this is the right road. I agree with the speaker in a radio broadcast last week who said of the Gracious Speech. Well, at least the package of proposals in it will do less harm to Britain than those in any previous Queen's Speech under Labour. and: All in all, this is not a bad Queen's Speech.

Those are the words of the right hon. Member for Cambridgeshire in the Conservatives' party political broadcast. We reject the totally negative amendment on which the Tories invite us to divide.

5.56 p.m.

Sir Geoffrey de Freitas (Kettering)

I welcome the serious attention that is being given to unemployment nationally, but I make no apology for explaining to the House that I shall be parochial, although I shall not take long. I have served in 10 Parliaments, but never before have I had to make a speech referring to unemployment in my constituency. Today I do so.

I have frequently spoken here about the need to diversify industry in the constituency, concentrating particularly on the steel town of Corby, but never have I had to do this against a background of unemployment.

This morning, I saw the Minister of State, Department of Industry with a deputation from the district council, the county council and the development corporation to ask for assisted area status for Corby. We know the advantages that we derive from being a New Town, for example with industrial development certificates, but, after considering all the facts, the two local authorities and the development corporation concluded that we should ask for assisted area status.

In seeking this status, the district council has considered the requirements that it would have to fulfil in order to justify its application. These are declining employment, significant unemployment, over-reliance on one industry, and a lack of alternative industry. On the first two criteria, I can tell the House that since 1970 there has been a decline in employment in Corby and that the unemployment rate now stands at 7.9 per cent. compared with 4.8 per cent. for the county, 5.2 per cent. for the region, and 6.3 per. cent for Great Britain.

As for over-reliance on one industry, half the town's work force is employed by the British Steel Corporation. For years, and certainly since 1964, the local council, the development corporation and I have done all we could to get diversification, but because of the industrial structure of Corby it is very different from other towns.

Corby is certainly reliant on one industry, and the British Steel Corporation is going through a bad patch and losing £10 million a week. We know that this is a national and international problem and that we are not alone in the battle. There were encouraging words from the Secretary of State for Trade, who wound up the debate last night. Referring to our membership of the European Community he said: We have been using that membership constructively in trade policy terms to ensure success for our industries in areas where we are currently under attack. Our membership has provided us with the ability to achieve a better balance in the formulation of trade policies as against the United States, certainly better than any individual country of the Community could achieve.—[Official Report. 8th November 1977; Vol. 938, c. 617.]

That makes sense because, after all, 250 million people are likely to carry more weight in international discussions than a country of 55 million people. But whatever happens Corby is bound to be hurt. A steel town like Corby is bound to be hurt.

We have first-rate trade unions for the steel workers and Mr. Sirs has the confidence and the support of all the steelworkers.

I have referred to Corby as having declining employment and a high rate of unemployment, and as being reliant on one industry. I come now to the alternative industries. Over the years we have done everything possible to attract industry to the town. There have been some successes, but obviously there have not been enough. That is the problem we face today, and that is why the town needs assisted area status.

This view is supported by the East Midlands Economic Planning Council which does not do such things lightly. I asked the Government this morning to look carefully at the problems of Corby and to give the town what it both requires and deserves. It is perfectly fair to ask whether we as a town are fit to get help. Will the town help itself? Corby has the ability to do justice to any grant that it should receive and to any special treatment that it should receive.

The attractions of Corby as an industrial centre include the services of the development corporation, which is very experienced. It is a well-established community. There are few problems which have not been met in one way or another. The only disadvantage — it is a real one—is that of road connections with the immediate surroundings. We are not far from the A1 and the M1, but there is the problem of road links. This is recognised by everyone the county council, the district council, the development corporation and the chamber of commerce.

There are rail freight facilities and air facilities at Castle Donington and Birmingham. Most important, we have modern factories ready on tap, and also a policy of leasing land to anyone who wants to plan and build a factory. It is maintained, and sadly I know it is a fact, that we have available a very good skilled labour force as well as an unskilled force.

The council and the development corporation have developed an infra-struc- ture for a town of 80,000 people, yet the town is only half that size. The infrastructure is there, including a technical college, a swimming pool, a golf course, and so on. It is a living community and a fine community. But there is the possibility that it could be seriously hit.

We can offer these attractions and there is a wide range of educational facilities. including a technical college with another one a few miles away in Kettering which is complementary to it in the courses it offers. We are ready as a town, working together with the county council, to do anything we can. We also claim to build factories cheaper and better than most of our competitors, although I confess that not all of our competitors accept that.

As I said at the beginning of my speech, this is the first time that I have had to speak against a background of unemployment in my constituency. Along with the deputation, I have asked for assisted area status for the town of Corby. The town is ready to do justice to the opportunities that this would give. I really believe, and I ask my right hon. and hon. Friends to recognise this, that we deserve help and that we shall make very good use of the help we may receive.

6.4 p.m.

Mr. Donald Stewart (Western Isles)

The right hon. Member for Kettering (Sir G. de Freitas) is fortunate to be able to claim that this is the first time he has spoken about unemployment in his constituency. I do not think that I have ever been able to speak in the House without having to refer to the high level of unemployment in my constituency.

The Leader of the Liberal Party took great credit for the advances, as he claimed, in the Gracious Speech. It appears that the right hon. Gentleman has taken credit for repelling the kind of Bolshevik measures that might have come from the Government. I confess that I did not expect that the Prime Minister would come to the Dispatch Box and, like Lenin, say "Let us now proceed to construct the Socialist society ". The Leader of the Liberal Party—I am sorry that he is not present—ought to go easy with his claim that he and his troops are running the Labour Government. There could be a counter-reaction among the other half of the Lib-Lab pact engaged on the long march.

In March 1974, when the Labour Government came to power on the slogan "Back to work with Labour ", the figure of Scottish unemployment was 89,658, or 4.1 per cent. In October this year the figure had risen to 183,889, or 8.5 per cent. In the period 8th March 1976 to 31st May 1977 the number of redundancies notified to the Department of Employment in Scotland amounted to 106,284.

The report of the Manpower Services Commission, to which reference has already been made, states: Scotland must prepare itself for a continuing high level of unemployment into the early 1980s.

The report says that it is unwise to project a continuing improvement in the Scottish economy. An ominous picture for current and future employment in Scotland is becoming apparent. It is totally unacceptable, given the potentially strong economy of the country, that the adverse percentages are always higher in Scotland. The figure for teenagers— 13.3 per cent. of the Scottish unemployed—compares with less than 9 per cent. for the United Kingdom as a whole.

As has already been pointed out, the frustration, demoralisation and social implications, both for those involved and for the community as a whole, are regarded by my party as totally unnecessary and unacceptable.

The Government must make urgent moves to increase training facilities for young people. The United Kingdom trails behind its continental neighbours in this regard. Both France and Germany have introduced job creation schemes designed to give young people training which will be useful to them in the long term. In contrast, the United Kingdom job creation schemes have been piecemeal, short-term, and usually not slanted towards practical training. Despite these faults —I am not querying the motives of the Government in introducing the job creation schemes in the first place— the schemes were imaginative and useful.

In my constituency the unemployment figure is now down to between 10 per cent. and 11 per cent. for the first time in my lifetime. That has been due to these schemes which are short-term.

A lot of useful things—roads, piers, sheep folds, and so on—which might not have been constructed for a long time ahead have been achieved by these schemes. I am therefore quite open in welcoming what has been done in my constituency by the job creation schemes.

There is one point which I wish to put to the Secretary of State for Employment. I have put it to the Secretary of State for Scotland. I refer to the introduction of a road equivalent tariff in my constituency. The right hon. Gentleman and his colleagues say that this would cost an extra £3½ million but, as the hon. Member for Motherwell and Wishaw (Dr. Bray) said, this is a small figure if it will guarantee a reasonable and economic system of freight to the Scottish islands. If this were done there would be scope for development and employment in a short period, and we should be saving the State some money

I was not quite clear whether the right hon. Gentleman indicated that the job creation schemes were to continue in some form after the deadline in March 1978. I should be grateful if that could be made clear in the winding-up speech.

I would also press again for the reintroduction of the regional employment premium. I know that Ministers claim that the money is being made available in other ways, but we see no evidence of that. Since 1971, Scotland had benefited from REP to a considerable extent. Now that the jobs boom from the oil industry is diminishing, the Government should re-examine the matter

Successive Governments have totally neglected the essential task of meaningful long-term plans for the Scottish economy. They appear to be moving in the opposite direction. The right hon. Member for Kettering referred to the position in Corby. It would appear that the recent plans further to reduce investment in the Scottish steel industry will finish steel production in Scotland. When steel was nationalised on a United Kingdom basis, my party gave a warning. We were not all that worried about the principle of nationalisation, but we said that, once the industry was organised on a United Kingdom basis, that would be a death warrant for the Scottish industry.

I turn to employment in the fishing industry. I need not repeat the way in which the interests of our fishermen were sold down the river—if that is the correct term—by the Conservative Government in the first place and by the Labour Government on renegotiation. We must have a 50-mile control limit, for otherwise many of our fishermen will eventually be on the dole.

It is becoming increasingly clear that Scotland's economic, industrial and employment problems will not be solved by out-dated and unsuccessful United Kingdom policies of Governments here. What is really needed is the opportunity to use Scotland's wealth in natural resources for a radical new approach to our problems. The exploitation of our resources under London control is robbing Scotland of the chance to build, and take decisions for, the future economy of the country. We are missing out in the short term on the major part of the industrial benefits, and in the long term the enormous revenues from oil will bypass Scotland.

We are determined that this wealth shall be used to remedy the scars that have been allowed to fester owing to the casual approach by Governments composed of members of parties in this place. The next election will show that my party is the only one that can offer the strength of commitment to foster hope and confidence in Scotland.

6.12 p.m.

Mr. Stan Thorne (Preston, South)

It is not my intention to follow the right hon. Member for Western Isles (Mr. Stewart) into a discussion of Scottish economic affairs. I intend briefly to refer to some areas of employment problems in my constituency that have been well dealt with by the Departments of Industry and Employment—I applaud what they have done—before I turn to the general problem of unemployment, which is by far the most serious problem that we face today.

A small business in my constituency called Sharpies Photomechanics—a high-technology business, British-owned and the only one of its kind in the country—faced problems, and unemployment was on the cards. It was only after approaches to the Department of Industry that Government funds saved that vital business, and with it a number of jobs.

The Preston docks were to be closed as a result of a decision by the Conservative-controlled Preston Borough Council taken a year ago this week. That decision resulted in the establishment of an action committee of port workers, users, local councillors, Members of Parliament and others who were anxious not only to protect a long-established part of the Preston community but 1,000 jobs. The Departments of Employment, Industry and Transport all played a part in meeting deputations and setting up investigations into the future viability of the port. Subsequently the decision was taken to put in £2 million of Government funds to ensure that the docks could be kept open for the next two years and be made viable.

The involvement of the action committee, based upon the community, could well be the cornerstone on which the new manager put in by the Department of Industry creates the essential viability. I have no doubt that viability can be established if he uses the co-operation that has been built up in the campaign to keep the docks open.

This brings me to the question of industrial democracy, on which, unhappily, we shall not make much progress if the Gracious Speech is to be taken at face value. I have an aircraft factory in my constituency, and there are two others nearby. There is great concern in aerospace about the question of jobs and the involvement of the work force in the decision-making process. A document which I understand has been accepted by some in the work force defines industrial democracy as participation, consultation, the passing of information and so on. The shop stewards in the Preston area are under no illusions about what that form of words really means. It may well be viewed in some management schools as a new approach to communications, but in terms of establishing real democracy it is virtually valueless.

When we speak of industrial democracy we are talking about the right of the work force at all levels within an industry and within individual undertakings to be involved in decision-making in a range of matters concerning products, the work force itself, the nature of marketing, the diversification that may be possible, the physical nature of the environment, prospects for the future and so on. Those are all matters in which all should be involved through a structure of committees composed of various sections within the industry. Nothing short of that can be given the name "industrial democracy ".

The confidence of the work force in relation to its employment prospects is extremely valuable. Here I turn to my other local problem. The right hon. Member for Leeds, North-East (Sir K. Joseph) spoke yesterday about increasing profit margins. That is not a new matter for Conservative Members. They have been devoted to the production of increased profits for a long time.

In my constituency a subsidiary of Lonrho—John Barnes—has been producing textiles in Preston for a long time. Lonrho has been able to record particularly high profits in parts of its large empire. Unhappily there has been a recession in textiles, and redundancy notices have gone up at John Barnes. Lonrho intends to close the factory on 30th January next year. Appeals have been made to the company, and there have been discussions with the Department of Industry.

It is clear that the Government are willing to put in additional funds to protect the 400 jobs in Preston and Rossendale. But the board of Lonrho says "Each part of our many-sided enterprise must be autonomous, and we are not prepared to use the profits from other sections of our business to wait and see whether the Government's new negotiations on the Multi-Fibre Agreement result in an improvement in the textile industry in 1978. "

This brings me to the question: profits for what? Are Conservative Members trying to suggest yet again that increases in profits are ploughed back into improvements in machinery, technology and such items to increase productivity within an industry? If hon. Members were to pay a visit to the textile factory of John Barnes in Preston, they would be appalled at the conditions in which the workers in that factory are operating after years of profit-making by the group of enterprises of which it is a part.

Textiles, of course, are an important part of industry in the North-West, as are motor cars, television tubes and electronics. It has to be faced by the Government Front Bench yet again that we have been steadily importing unemployment by failing to apply selective import controls in the areas that I have mentioned. I accept that it is the multinational companies, the monopolies and the oligopolies, that take decisions about the movement of funds and about the establishment of productive enterprises that are relevant in this context.

However, I refer again to the right hon. Member for Leeds, North-East. He talks about productivity through increased employment. It seems to me that increased employment is not part of the plan for increased productivity that investors likely to be listening to the right hon. Gentleman would be interested in applying. In fact, their investment could well lead to a fall in the level of the jobs available in certain industries through technological development. Indeed, it is widely recognised that industry has excess capacity at present.

In regard to the problem of unemployment and increasing profit margins, we are faced with the age-old contradiction that exists within capitalist societies. People who are in business to produce goods are interested in maximising profits. At the same time it is vital, if they are to achieve their aims, to minimise costs. By far their biggest cost is undoubtedly the wages and salaries that they pay to their employees. Therefore—the Government, unhappily, have been involved in this business for the last three years—the standard of living and the wages and incomes of people have a direct relationship to the question of productivity for those seeking to maximise profits, because, if the purchasing power of the people has been so diminished that they cannot afford to purchase products, what happens is inevitable. There is a cutback in productivity. It appears to be almost a vicious circle.

Increased productivity is obviously something in which, if we are really interested in improving living standards, we all have a vested interest. For most Labour Members, the production of socially necessary goods would be the motivation, but if that were to be done without any major increase in incomes across the board—not only for those actually in employment but for the elderly and the unemployed—there would be little prospect of taking up the increased productivity that we are all seeking to achieve.

It seems to me that we come inevitably to the amendment in the names of some of my hon. Friends, which, unhappily, is not being called, in regard to the whole problem of public expenditure. It is clear that if there is already a problem of excess capacity in industry and an absence of confidence on the part of those who are able to invest, it is the Government's responsibility to seek to invest in labour-intensive industries. Yesterday the Prime Minister referred to public expenditure. He described it as providing public services. That is quite obvious and quite right. It follows, therefore, that since public expenditure has been reduced, so also have public services.

The Labour Party has prided itself over the best part of this century on improving public services in a wide sector. If we were debating housing, the figures that we could have before us today show, unhappily, a fall in the level of house building in Britain at present. In the National Health Service we hear of the slow development in the building of health centres and in the provision of more hospital beds in certain parts of the country, and the training of qualified nurses to become doctors is still something on which we have made virtually no progress at all, against this background of reduced public expenditure.

In local authority terms—most Members of Parliament have this experience in dealing with day-to-day case work—the standard of social services in certain areas, in Lancashire in particular, is quite deplorable. Again and again we are reminded by the local authority that public expenditure cuts are responsible. I think that this has been exaggerated in certain Conservative-controlled areas. Nevertheless, it is a fact.

Home helps are not available in the numbers required. Neither is there adequate aid to the elderly, the sick and the infirm. The number of health visitors that it is possible to call upon in many areas and the equipment for those who are handicapped, particularly the deaf, are grossly inadequate. There has been an argument recently about the availability of kidney machines. All these factors are deplorable against the background of public expenditure and the level of employment.

Certainly, in many of the sectors that I have mentioned, in housing, health and so on, a massive input now—not in April 1978, when £400 million worth is going in—could have an immediate impact in terms of services that could be provided.

Mr. Ron Thomas

Does not my hon. Friend agree that the cuts in public expenditure have left us with a situation in which local authorities are certainly not geared any longer to meet this kind of injection and that, therefore, the injection that is projected will take almost a couple of years before it has any effect on jobs?

Mr. Thorne

That is possibly true, but I believe that some projects that local authorities have had to put on the shelf because of cuts, projects which were actually at the tender stage, could very quickly be put into practice in terms of building certain major projects. By so doing, the figure of 260,000 unemployed building trade workers could be radically reduced fairly quickly. It is in that sort of area that I look for quick action from the Government.

In education—another area of public expenditure cuts—we have a situation in which there has been a reduction in the number of students following the restrictions on overseas student grants. There has been a reduction in the number of students because of the control over discretionary grants exercised by local authorities. Because of that reduction in the number of students, inevitably there is a reduction in the number of teachers and administrative staff and a reduction in various other areas of job opportunities.

As many Labour Members have argued time and again, particularly my hon. Friend the Member for Sheffield, Hillsborough (Mr. Flannery), we should have been using the situation of the last three years to tackle the problem of oversized school classes in many areas, and the problem of city areas in which social deprivation is at its most acute and where we should be having positive discrimination in certain types of school. All this has suffered in consequence of public expenditure cuts. It has already been said today that, against that background, the Manpower Services Commission has been talking about upward trends in unemployment over the next two years and saying that the prospect for the future looks particularly dim.

I do not wish to continue speaking much longer because I know that I am already exceeding my time, but it is important to note that part of what we have been analysing today stems from the Lib-Lab pact, to which some hon. Members have already referred. There is an amendment in the name of my hon. Friend the Member for Liverpool, Garston (Mr. Loyden) pointing out that there is nothing in the Queen's Speech referring to public ownership of the ports industry in Britain, even though that was part of the 1974 Labour Party manifesto. That is part of the price we have to pay for the Lib-Lab pact, because I imagine that the Leader of the Liberal Party would not have accepted the inclusion of such a measure in the Gracious Speech. There are other clear indications that we have paid such a price in terms of our inability to control the economy without public intervention of a firm nature within manufacturing industry and elsewhere.

Deliberately failing—as this Government have done—to take action to improve employment prospects for both young people and the not so young is a crime. That subject could have been discussed on Monday when the House looked at the prevention of crime within Britain today. Depriving people of work creates root-lessness, and that inevitably contributes to an increase in anti-social behaviour and the rise of Fascism.

It is against that background that urgent action by the Government is now required. What are we going to do? During the next 12 months Parliament will be called upon to fritter away its time talking about European elections when the main problem to which it should be addressing itself is legislation that would create new jobs for 2 million people in Britain during the next two years.

6.33 p.m.

Mr. Julian Ridsdale (Harwich)

I was interested to hear the hon. Member for Preston, South (Mr. Thorne) complaining about cuts in Government expenditure. My mind immediately went to such countries as West Germany, the United States of America, and Japan where the standard of welfare 10 to 20 years ago—particularly in Japan and West Germany—was considerably lower than it was here. Those two countries put the creation of wealth before welfare because, having been defeated, they did not have the wealth with which to pay for welfare. Unfortunately, we have put excessive welfare, which we cannot completely afford, ahead of the creation of wealth.

If we had the wealth to maintain the standard of welfare that we now have, I should welcome it, but, to maintain that standard of welfare, we must create much more wealth. The depressing thing about what has happened under this Government during the past four years has been that the rate of production of wealth has fallen while the gross national product has flattened out completely. In Japan the GNP, in spite of recession, has risen by 6 per cent. and inflation has been controlled. I was recently in West Germany where the rate of inflation is now 3 per cent.

I sense a mood for protectionism on the part of Labour Back Benchers, but I have also listened to economic Ministers in West Germany and to the German Chancellor, who is a free trader, not a protectionist, and who recognises the dangers to the European Community that could result from protectionism. Their philosophy is different. It is that we must create more wealth and that, if we have inefficient industry, it should face the blast of competition, if necessary, because otherwise there will be more unemployment.

Mr. Martin Flannery (Sheffield, Hillsborough)

The hon. Member for Harwich(Mr.Ridsdale) has not mentioned that in Japan there is massive protectionism, so much so that British cars could not possibly penetrate that market. We must take into account the fact that in West Germany and Japan there is massive investment which the hon. Gentleman and his party have refused to put into our industry, although they talk about patriotism at the same time

Mr. Ridsdale

I thought that that intervention would be a red herring. If we were producing sufficient cars in this country, we could enter the Japanese market. It is depressing to learn that secondhand Minis are being exported to Japan and that that is paying.

I come to the remarks that were made by the Secretary of State today, because I noted a great change in his philosophy from the last time that he spoke. He now recognises the problem and realises that, if we are to cure unemployment and give security to our 25 million workers, we must have efficient industry and more investment and he able to face competition.

I am disturbed about competition from the EEC. There has been £706 million-worth of car imports from the EEC so far this year and the adverse balance amounts to £1 million per day. That figure is so high because our industry is not producing enough cars. The Secretary of State for Trade has said that three years ago we were producing 1,900,000 cars a year and that the present figure is 1,300,000. What a pity that we cannot get productivity up so that people can buy British cars and not imported ones. We are not producing enough cars.

I turn to the steel industry. In talking to the heads of that industry, one realises that we are not getting sufficient productivity from the investment we have made in the industry, any more than we are getting sufficient productivity from the investment that we have made in the coal industry.

I also wish to refer to my own port of Harwich. I visited management and trade unionists there last Friday. The British Railways port at Parkeston is doing very well, although it needs incentive from the Government. But what happens? The Prime Minister has done a deal for us to sell ships to Poland, but what a pity he did not turn his mind to the fact that we are operating 15-year-old ships as cross-Channel ferries. He did not say that we should modernise our shipping, but what is the difference between modernising shipping belonging to a nationalised industry and sending ships to Poland with a subsidy? I should prefer to see investment in this country.

We must take measures to increase productivity. Trade union organisation in West Germany and Japan is conducted on an enterprise basis which encourages productivity and gives reward to those creating wealth. We must have that kind of approach here if this country is to go ahead. It does not exist here now and in some nationalised industries and British Rail, part of which work jolly well, there is demoralisation because profits are taken away from efficient industries and incen- tive is lost. We need improved morale if we are to go ahead as we should as a country and that is what I am seeking.

In my constituency there has been for a long time a 12 per cent. unemployment rate. It used to be in one sector, among older people, but I find that the unemployment is now spread right across the board and includes young people in their twenties as well as those in their sixties. It is now far more serious. It is extremely disturbing to see unemployment running at this rate.

In my constituency, I have some very enterprising industries which arc going ahead and developing and which have a 50 per cent. export trade, yet one industry in my constituency is finding it impossible to recruit 50 workers. In the midst of 12 per cent. unemployment, and with youth unemployment fairly high in Colchester and in my own area, the Nash Clothing Company, an extremely enterprising company with branches in the North, cannot get 50 people to meet its huge export orders. I have written to the Secretary of State about it. I have not yet received a reply from him, though I trust that I shall have one eventually. I have asked for a special inquiry to be made. It is nonsense that, with unemployment running at the level of 12 per cent. locally, a firm cannot find 50 recruits, to help especially in the export trade.

Confronted with problems of this kind, I have been round to schools in my constituency, and I welcome the liaison existing between industry and the schools. I have half of Essex University in my constituency. On the technical side, the university is first class. I should like to see more of those engaged in general education taking technical education, but when I go round the technical departments, I am disturbed to discover the number of foreign students who are benefiting from technical training rather than our own students.

I agree very much with what the Secretary of State said about the shortage in a few years being of skilled people. It is so already. We must have a higher standard of education in our schools and a much closer liaison between our schools and industry and between our schools and the further technical training which is available so that we are able to compete in a technical world.

Our agriculture is first class. The City and its invisible exports are first class. Given their head, our smaller industries are first class. But we have to get into advanced technology if we are to create wealth. We have to get rid of the attitude of mind that the creation of wealth is wrong and that to give incentives for the creation of wealth is wrong. Without wealth we shall not be able to help solve our unemployment problems. A lot of this has to be taken up in the service industries. Only then will we have the wealth to do what is only fair and right and what should be done.

We must have a new attitude of mind. We must get rid of the old-fashioned idea of the Left that we can build a fortress round ourselves and so protect ourselves. Many of our problems stem from the protectionism of the 1930s when we were not willing to expand and to accept competition. We do not want to see world trade in that position again.

I have visited 19 or 20 small industries in East Anglia in the past month or so. I have also seen much of Japanese industry. I can tell the House that our own small industries are just as good and just as efficient as any Japanese industry.

The difference between them is very simple. When I was in Japan last April, I met a number of British furniture manufacturers at our British export trade centre. They were all small business men. They asked me to tell the Government when I returned home to get off their backs. They said that they were being taxed at double the rate of the Japanese and that the Japanese were getting double the wages that they were in the same trade.

As I go round small industries—for example, one very efficient firm making sails for the export trade and another making machine tools— I see the owners working on the shop floor. It is clear that, if tax incentives were given to them, they would create the productivity enabling them to go ahead. It can be done. A great deal of unemployment can be taken up in our smaller industries if the Government will only back them and give them the incentives which are vitally needed.

I heard the right hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel) say that he was glad that a profit, sharing scheme was to be introduced by the Government. I hope that it was as a result of my Employers Investment Bill which I introduced last Session and which was opposed so vigorously by the hon. Member for Luton, East (Mr. Clemitson). Employees must be able to feel that they are part of a team and that their jobs are worth doing.

These are improvements that we would all want to see. If we can get them, we as a country can go ahead. I am sure that, if the Secretary of State applies his mind to these matters, we shall be able to achieve them.

In terms of the regional development fund, the Secretary of State must look at areas such as the West Country and East Anglia. There are efficient industries there which need help.

Mr. Frederick Willey (Sunderland, North)

I thought that the hon. Gentleman wanted the Government to get off their backs.

Mr. Ridsdale

To move industry out of these areas to the North-East, with all the cost involved, is clearly absurd. I hope that the Secretary of State will see whether he cannot be more flexible with the regional development fund. It is worth while supporting some of these smaller industries which are the lifeblood of the country, and not entice them unnaturally to the North-East.

I hope that this new attitude of mind will come. The opportunities are there. The will is there. But we must accept the spur that other market economies in Germany, Japan and America have. If we do that, we can go ahead. But if we go back to the fortress mentality of Socialism, we shall not.

6.46 p.m.

Mr. Frederick Willey (Sunderland, North)

In form at least, this debate is rather superficial. I well remember the late kin Macleod saying on one occasion that, when he was the Minister responsible, all he did was to collect the unemployment figures and publish them, with the result that when they went up he was unpopular and when they went down he was popular. He did little more than that. The same could be said of my right hon. Friend the Secretary of State for Employment. His Department is an administrative Department. I have no wish to promote redundnancy, but there may be a case for putting his Department into the Department of Industry.

Today, however, we are discussing deep economic issues, and we have to solve them. It is to them that unemployment is related. Last week, the Prime Minister talked about there being 16 million unemployed in Western industrialised countries. At present, there are 7 million unemployed in the United States, and we know that this is unprecedented because there is not a slump in the United States. There is economic expansion. What we are facing is a very deep crisis in capitalism. We have to seek a solution.

We had a period when we had Keynesian economics, the Welfare State and the sustaining of purchasing levels. But these are no longer enough. We also had the growth of the mixed economy. However, in that mixed economy public ownership in manufacturing has almost entirely been devoted to rescue operations involving Rolls-Royce, the shipyards and British Leyland. Apart from those, the nationalised industries are industries which supply manufacturing industry, and it so happens that they are industries which are in decline in terms of the manpower that they employ.

Taking the present position compared with vesting day, there are 40,000 fewer people employed in the gas industry, there are 50,000 fewer employed in the steel industry, which is now faced with further redundancies, and in coal mining there are about half a million fewer men. We have gone into the manufacturing industry in the case of the nationalisation of aircraft and shipbuilding, but we have done so far too late to be promotional. I agree with my hon. Friend the Member for Liverpool, Walton (Mr. Heffer), who said in an intervention that he wanted alternative work and not redundancy pay. However, there are a great many shipyard workers who will be in need of that redundancy pay.

Apart from public ownership there has been a continuous and expensive programme of across-the-board incentives and inducements generally designed to persuade industrialists to go to socially desirable locations. This has been an all-party policy. It was considerably ex- panded by the Industry Act 1972. But the vital point is that all this public enterprise has been negative and defensive, not positive and aggressive. Overall it has been ineffective. The development areas are still there. One can still define them because they have twice the unemployment rate of the more prosperous regions.

Sunderland has the worst unemployment of any town in Britain, and it has been so for 10 years. I do not say that the inducements policy has been completely ineffective, because that would be an exaggeration. There has been a measure of diversification, and without that things might have been worse. Nevertheless the attitude has been negative, and I can give a simple illustration of what I mean.

One of our major difficulties in the North-East over the last decade or so has been the 100,000 redundancies in the pits. Surely it would not be a revolutionary concept to regard these men as State employees to whom the State owed a responsibility for providing alternative work. I should have thought that that was an acceptable proposition. However, we have never taken a sufficiently positive attitude towards these problems.

Our problems are not unique. They affect all the Western industrial countries. But we have to see what we ourselves can do. In one respect we should recognise that at the moment we have an advantage. The investment by Ford in Wales is an indication. I met some American industrialists the other day and they were convinced that the Ford company was right and that on the balance sheet of advantage and disadvantage this country at the moment is the best choice for capital investment abroad. We had better take the greatest advantage of that while we can.

I say that because there is at present the delay about deciding on Hitachi. We must have a decision. We must decide whether the safeguards can be met. If we go on with the procrastination and delay, it will seem that we are reluctant to accept investment from abroad, and I do not believe that we can afford that.

In considering unemployment, the crucial factor is investment. In our approach to this problem we have to recognise that there has been a very radical change. Parliament has provided important new machinery. There is the National Enterprise Board and the complementary planning agreements. The NEB is charged to extend public ownership into profitable areas of manufacturing industry.

The Board is charged with creating new jobs in areas of high unemployment. The trouble is that Parliament has provided the tools to do the job, but they are not being used sufficiently. An insufficiently effective effort has been made to use the machinery that Parliament has willed. To rectify this lack of response we should break the problem down and tackle it at ground level.

So I turn to the Northern Region, and to Sunderland in particular. I do this not only because devolution has made unemployment a particularly sensitive issue in the North-East but also because the Northern Region has had for some time the highest level of unemployment of all the regions and Sunderland has had the worst unemployment. I do not want to give lots of figures, but in terms of benefit and aid unemployment costs more than El million a week in Sunderland alone.

Earlier this year we were shocked by the Plessey closures. We got the NEB report on the North-East and the North-West. We in the North are very much obliged to the regional director for the work he is doing in the North-East. We have had a plethora of reports describing what should be done about employment in the North-East. I regard this report, however, as one of the best. I say that for two reasons. It is constructive and it is concise.

I shall touch on two of the report's recommendations. One is that the armoury of assistance should be focused more sharply on the special development areas.

The Government must do more about this than they have done. They have responded, but they must do more. Since the report was published, Sunderland Corporation has submitted a detailed report to the Department. We want action on that report, and at the same time we should like a skillcentre in Sunderland.

The second recommendation concerns North Sea oil. We need a major offshore contracting company. It is an absolute scandal that practically the whole of the servicing and maintenance of our rigs is done by foreigners, principally the Dutch and the Norwegians. We have to put that right. This is not a matter of building a fortress around Britain but is a question of showing initiative. If private enterprise cannot show that initiative, the Government had better see what they can do. This is an important matter for Sunderland because we have Greenwell's repair yard which was closed some time ago and the docks. This is the best base in the country for the offshore industry. Therefore, let us pursue that.

All these reports are being sympathetically considered. We have more hope of action from the NEB Report simply because the NEB is behind it. I am glad that there is to be a regional board which will reinforce this. However, the major problem remains one of implementation. We now want, particularly in the light of our experience since the war, a different approach. I concede to the hon. Member for Harwich (Mr. Ridsdale) that we want to apply more the practices and attitudes of private enterprise. We want to get more direct, more selective, action. We want to allow for a greater element of personal responsibility and enterpreneurial judgment. We want to allow for more flexibility.

A long time ago I was a member of the North-Eastern Trading Estate Company. I raised this issue there. Mr. Sadler Foster and I went to the Board of Trade, as it then was, and asked the officials what return they wanted on their money. We said "Tell us what you want and we shall see that you get it, but leave the rest to us. As long as we give you your return, let us do the job." We said that for obvious reasons. We were building factories which firms required no inducement to occupy. It was enough that we were able to build a factory and that the labour was available there. At the same time, there were other cases in which we wanted to provide a more tailored incentive for the companies that we particularly wanted to get into the North-East. That demonstrates the attitude we want to see. The Secretary of State for Employment is on our side, because he said the other day that we should not wait for Westminster and Whitehall to do things for us. So let us do them ourselves.

I appeal to the Government, therefore, to do one of two things—or possibly both. Let us have a development agency with full powers to carry out everything under Section 7 of the Industry Act. Let us have an agency which will be responsible, and give it full powers. Then we shall get the job done.

Alternatively, let the Government accept the proposals which I made a month or two ago. First, let us have a Minister for the North. I want a Minister for the North because so many decisions now are being taken by Ministers. I emphasise the word "Ministers ". In the old days a Minister took a decision, but that is not so now. It is always a plurality of Ministers. There is the Hitachi question, for example. If decisions of that kind are to be taken, we want a Minister for the North to be there when they are reached.

Much more important, however, I want a commissioner for Sunderland, or, as the SunderlandEcho put it in describing my proposal, a jobs supremo. He would be accountable to the Minister for the North. In other words, I want somebody who would be personally accountable for creating new jobs in Sunderland. There is plenty of scope. In the first place, we have more than a score of empty Government factories. We are still building more, but these factories remain idle. If we had somebody who recognised that it was his responsibility to get machinery and work into those factories, I do not imagine that any hon. Member on the Opposition Benches would complain if he was driven to do it by public enterprise. His job would be to get work into those factories. The second job would be to ensure that we had an offshore servicing industry established in Sunderland, based on Greenwell's and the docks.

I recognise that this would be experimental, but let us see how it would turn out. I believe that it would be successful. I believe also that it would be a precedent for introducing a new-style administration which might begin the reinvigoration of British industry we need.

7.1 p.m.

Mr. James Molyneaux (Antrim, South)

. The selected amendment refers to unemployment, a subject never far from the minds of Ulster Members. No doubt the reasons for our Province's unenviable pre-eminence in the grim statistics are numerous, but one major reason is not new. It is the peripheral position of the Province in relation to the rest of the United Kingdom which intensifies all the stresses and handicaps which affect Britain as a whole. This is the basic economic reason for our hostility to membership of the Common Market. It is bad enough to be peripheral to the British economy. It is much worse to be peripheral to a British economy which itself is a peripheral region of the European economy.

It was certain that if inflation were to be overcome an increase, though temporary, in unemployment would be an unavoidable consequence. But we on this Bench have always maintained that to overcome inflation was the first priority, and we have, as we promised at the beginning of this Parliament, supported the Government in the financial measures necessary to that end, even when those measures were unpopular. It is difficult to imagine how any other party in the House could or would have met the challenge of inflation more successfully. That is why we did not support the amendment yesterday, and we shall not support the amendment tonight.

One deduction can be drawn with complete confidence from the relationship between Ulster's geographical situation and Ulster's unemployment. Everything which improves communications of all kinds—from airlines to pipelines—between Ulster and the mainland and everything, which integrates Ulster's economy into that of Britain as a whole is of benefit to Ulster's people. The House will find in that fact the unifying thread which runs through nearly all the objectives which my party pursues from Session to Session.

It would be repeating a truism to allude to the connection between Ulster's economic experience and the terrorist campaign waged against all of our people over the past eight years. I am glad to record —it would be disingenuous not to do so, despite all past disappointments—the striking improvement of which all who know the Province are well aware. I shall not take up time in this debate by discussing the reasons why this improvement has occurred. Instead, I shall look ahead. I wish to look at that aspect of manpower which is referred to in the passage of the Gracious Speech which reads: continuing to develop the effectiveness of the Royal Ulster Constabulary, supported by My Armed Forces.

At this point, perhaps I might record our satisfaction at the reference to Northern Ireland being placed in that section of the Gracious Speech which deals with the affairs of the United Kingdom—the first time since 1969 when Northern Ireland came in for separate mention.

For many years, it has been orthodox Unionist policy to insist that the Royal Ulster Constabulary ought to be the law enforcement agency, as it would be in the rest of the United Kingdom. We have reason to believe that this view was not universally shared among others, but it seems that we have at last got it right.

The Royal Ulster Constabulary and the RUC Reserve are daily increasing in strength and in confidence. The strength and effectiveness of that other indigenous element of Her Majesty's Armed Forces, the Ulster Defence Regiment, have been increasing also, particularly through the expansion of the full-time element. Co-operation between that Ulster Defence Regiment and the Royal Ulster Constabulary is steadily improving and ought to be still further developed, and both ought to be supplied and equipped with the best available equipment.

It follows that, as the effectiveness of these Ulster forces increases, the need for support from the Army will correspondingly diminish. It is our view that reductions can then be made in that part of the Northern Ireland commitment which places the greatest strain on the Army in terms of manpower. I refer, of course, to the short-stay elements—units which rotate on a four-month tour of duty. In terms of manpower, this is a wasteful exercise because, when the periods fore and aft of the four-month tour are taken into account, the total non-availability of units is about seven months, and, of course, its effect on training programmes is disastrous.

The most economical use of manpower is seen in the long-stay or garrison formations and in specialist units such as the SAS or the Royal Corps of Military Police. We, the elected representatives of Northern Ireland, must begin to think more along these lines and perhaps to warn the public against listening to those who, predictably, will cry British withdrawal "every time an outgoing unit is not replaced.

The Prime Minister and the Government have given firm evidence of their determination to defend the integrity of the United Kingdom, and we know from experience that reinforcements can be provided within a matter of hours, should the need arise.

All this, of course, has its relevance to the concern expressed by the hon. Member for Abingdon (Mr. Neave), shared. I am sure, by the whole House, over the standard of living accommodation. It is not suggested that four-star accommodation ought to be provided for some 14.000 troops. While we all want to ensure that the long-stay troops and their families are provided with a high standard of accommodation and that living conditions are made as tolerable to those on four-month tours as active service and the security situation permit, a gradual reduction in numbers would naturally ease the position and make possible a significant improvement in the conditions of the smaller number who would still be required.

No one will imagine that anything I have said detracts in any way from the contribution of the Army over the past troubled years. But it was never intended —nor, indeed, foreseen—that it should be committed for such a long period and in such great strength. Hitherto it has been the presence and backing of the Army in strength that has made possible the rebuilding of the morale and effectiveness of the security forces of the Province, which earlier mistaken policies had shaken. There is, however, a point—and it is rapidly being reached—after which the effectiveness and acceptance of the local security forces can continue to develop only if they are seen to rely more on themselves and less upon the back-up of the Regular Army.

We on this Bench have frequently voiced the willingness of Ulstermen to defend their part of the realm. To them, it is gratifying to be doing so in ever greater measure alongside other servants of the Crown.

7.11 p.m.

Mr. Jim Craigen (Glasgow, Maryhill)

The Queen's Speech refers to the continuance of action to reduce high unemployment through manpower measures and to promote industrial training and the opening speeches today seemed to concentrate on manpower policy. As I listened to my right hon. Friend the Secretary of State for Employment it struck me that in some senses we are using a great sledgehammer to crack a somewhat uncrackable nut, because, no matter how hard we try to deal with the difficulty by using the special manpower measures introduced in recent years, we are resolving the problem of unemployment for only a relatively small percentage of those who, unfortunately, are out of work.

In some senses, we have come a long way from the time when the "three wise men" were getting their knuckles rapped for suggesting that a level of 2½ per cent. unemployment was the equal of full employment in this country. What I find particularly disturbing about the number of people now out of work is the large proportion who are under 20 years of age. This is especially worrying because someone leaving school is at a particularly impressionable period in his life. Moreover, one would assume that this is a period during which he is more adaptable to the requirements of employment and, further, that it is a crucial period for training opportunities.

I want to direct my remarks particularly to the problems facing some of our inner city areas. I welcome the fresh thinking that the Government appear to be giving to the problem of urban renewal and reinvigorating life within our inner cities. It was appropriate that yesterday my right hon. Friend the Secretary of State for the Environment made a statement about his intentions in England. I trust that we shall get a follow-up statement from the Secretary of State for Scotland in respect of the continuing measures in Scotland.

I am aware of the initiative that my right hon. Friend the Secretary of State for Scotland announced last year for the Glasgow East End project. This is a sizeable project, and I suggest that there is scope for measures of a similar kind on a smaller scale. I have in mind the Maryhill corridor, where my hon. Friend the Member for Glasgow, Kelvingrove (Mr. Carmichael) and I have a particular interest. Earlier this year Glasgow District Council decided that there should be a local plan for the Maryhill corridor, and I trust that the Department of Employment and the Scottish Office will take a special interest in measures to increase job opportunities there.

The White Paper on inner city areas highlighted the problem of the erosion of job opportunities in many of our city centres. In the city of Glasgow alone, in the decade 1961 to 1971 we experienced a shortfall of about 16 per cent. in our manufacturing employment opportunities, particularly in mechanical engineering, shipbuilding, textiles, clothing and the timber and furniture industries.

One of the things that worry me about the over-concentration on the need to expand our manufacturing sector—and I think that there is a need to develop manufacturing industries—is that we cannot all be in manufacturing industries. The extent to which many service industries provide employment in our inner city areas is something we cannot afford to ignore. In my area, a number of firms are currently making use of the temporary employment subsidy—I am sure that this applies to many other areas too —and I wonder about what will happen to individual employees when the TES has to stop.

Glasgow District Council has been finding that there is a considerable demand for small factory units of less than 5,000 sq. ft., and sometimes even less than 2,000 sq. ft. I think that the building of such units will have to receive much more sympathetic consideration than has so far been given to the matter by the Scottish Office which now has responsibility not only for industry but for employment.

I have been in correspondence with the Scottish Development Agency about the efforts it might be able to make in the way of building small factory units, because so far its efforts have been directed largely at the construction of fairly large units. However, as the Agency points out, small units are more costly to build in terms of square footage and in terms of the number of jobs they provide. There would need to be some alteration in the indicators currently used by the Scottish Office for the Agency's building functions. I hope that what I have said will be passed on to the appropriate Department. It would have been better had the point been made yesterday during the industry debate, but, unfortunately, I did not get an opportunity to participate then.

Another aspect of the problem of small factory units is the difficulty that is frequently experienced by tenants who want to leave their somewhat inadequate factory accommodation in paying the rents of new premises. One feels that some additional help will have to be given to them, even if it is only for the first two or three years.

A lot of attention has been paid to the need to improve industrial performance. One of the attitudes that bedevil our industrial thinking is the legacy of the 1930s and the mass unemployment of that time. One has to remember the effect that that has had on the minds of men and women, many of whom are now in positions of leadership in industry. It affects attitudes towards such things as job security, or insecurity. I am worried about the almost Frankenstein conditions that we appear to be creating in the 1970s for the new generation of young workers. I do not think that we can afford to ignore the implications of the attitudes that might be developing for the future of labour policy and industrial relations.

I interjected during the Secretary of State's opening speech on the matter of the movement away from employing youngsters in industry. I thought that there was a very ominous situation developing in which many employers, for a variety of social reasons, were preferring to engage older staff when taking on additional labour.

One is inclined to forget, in the midst of all the talk about how we should spend the North Sea oil bonanza, that it is not so many months since Red Adair had to come over to help the Norwegians cap a blow-out in their sector of the North Sea. At the same time, we are witnessing in this country a similar waste through a blow-out of the number of youngsters coming on to the labour market each year. As the Secretary of State reminds us, an additional 100,000 are coming on to the labour market each year. More will have to be done to cap this type of human wastage.

The one figure that I jotted down during the Secretary of State's speech was that by 1981 we would require 1,400,000 new jobs. Precious little thought has been given to the problems associated with this. From where will these jobs come, from what sections of industry and commerce? How will we steer the additional numbers of young people into particular industries? As has been pointed out, many youngsters—whether this is due to the attitude of schools I do not know—prefer to go into non-technical and non-productive industries. This is equally true of our universities, where there seems to be a preference to go in for social rather than scientific, non-productive rather than productive employment.

I do not mean to be personally critical of the Secretary of State, because I have sufficient regard for his integrity to know that he is doing his best, but at times I despair of the musical chairs way in which we seem to reorganise our employment agencies. We have moved some distance from the days of the Industrial Training Act, put on the statute book in 1964. This Act was largely forged and developed by the last Labour Government and it has since been superseded by fresh legislation setting up the Manpower Services Commission. One of the primary objectives of the Industrial Training Act was to make sure that we would get the quantity and quality of labour required by individual industries. Also, firms were to share the cost of training. I fear that we have moved away from those admirable objectives.

When one looks at the unemployment figures in detail, one sees one of the staggering aspects is the large percentage of people, young and old, who are classified as general labourers or unskilled people. This means that far more attention must be paid to the training and retraining aspects of our existing policy.

Recently, the Strathclyde Regional Council talked about the possibility of opening an adult training centre in my area. I do not think it should be any part of the local authority's job, especially in these difficult times of the rate support grant, to be talking of this kind of task. This should be a task for central Government. I hope that the Department concerned will look at the possibility of opening a new skillcentre in the Maryhill area of the city.

I conclude with a word or two about the job creation scheme. In its way it has been useful. A lot of helpful and valuable work has been done by those concerned with its organisation. But I have always taken the view that its role is limited and I think it would have been better, in borrowing the concept from Canada as we did, to have called it the Local Initiatives Programme—the term the Canadians use. One of the difficulties in operating this scheme—I have had correspondence with the Secretary of State on this matter before—is that it is easier to get schemes off the ground in the better-off areas than it is in the deprived areas. This is because of a lack of professional skills available in the community and the lack of ready cash for promotion in the poorer areas.

It concerns me that at times we seem to have great difficulty in getting public money to promote projects in our areas when at the same time the Manpower Services Commission is giving out money for people to study work—not actually to do it, but to study it. One receives questionnaires from people on special schemes about facilities for which local authorities or the central Government say that they do not have the cash. The Department of Employment and the Scottish Office, in so far as it has employment functions, will have to look at the employment potential of the inner city areas in much more detail and far more energetically than they have in the past.

7.27 p.m.

Mr. David Madel (Bedfordshire, South)

I agree with the hon. Member for Glasgow, Maryhill (Mr. Craigen) that memories of high unemployment in the 1930s linger on for a long time and have had very damaging consequences for industry. The memory then was that one particular political party was exclusively to blame for the situation. In view of the events of the past three and a half years, I do not believe that anyone can fling exclusive blame on to one party. We are grappling with a world problem.

One of the previous speakers on the Labour Benches said that the unemployment situation was a crisis of capitalism. It is nothing of the sort. We have had fast and fantastic changes in technology and in energy use, and this answers the point about declining numbers employed in the gas industry, for example. When we talk about the next five or 10 years we must realise that unless the Americans can come to grips with the current oil crisis facing them there will be a hideous slump in the United States, which will drag us down as well. We cannot sell President Carter's energy programme for him, but unless it is successful there are bound to be serious consequences for this country.

This debate is being held at a most opportune time. It is taking place on the day that the Manpower Service Commission's annual report is published. In paragraph 2.25 on page 11 of that report the Commission says: The Government's industrial strategy … is intended to create wealth and income which in turn create growth and employment and there is bound to be a time-lag before employ-ment responds to increases in output but the dilemma in the shorter term remains. We have heard today that in order to pull unemployment down to 800,000 by 1981, 1.3 million new jobs must be created. Whatever we think of the Manpower Services Commission, it does not just stop the argument there. There is a great deal more in the report to suggest how this problem can be tackled. The Government will no doubt respond to the annual report, and they must face up to the argument contained in paragraph 2.25. Do they accept that in the short term the position, vis-à-vis investment and jobs, is unavoidable?

I turn to the comments on technician training, on page 33, in paragraph 4.35. In this section the report states that high priority is being given to developing technician training, particularly where it is linked with the requirements of industrial strategy. My question on that is: are the Government satisfied that the Manpower Services Commission can find a sufficient number of instructors to carry out this programme, which they rightly say will be needed by industry if the industrial strategy is to be successful? The report states that 1,400 people completed technician training courses under TOPS in 1976. If we are to exceed that figure—it is hinted that we ought to do that—the question is whether a sufficient number of instructors can be found.

This is all part of an extension of the education system. I recall that earlier this year the Department of Education and Science published its document on the training and retraining of teachers to teach mathematics, physical sciences and technology. On page 2, under the heading "Am I eligible?", it stated that Applicants must be aged 28 or over, and must not have followed full-time courses of higher or further education in the last five year. If we are to get people to take up technician training, and if we are to find instructors, we shall first have to get the mathematics right in schools and find more mathematics teachers. This scheme was concocted by the Government, and the Chancellor of the Exchequer, in his April Budget this year, announced £200 million for it. I wonder why the Government have made an age stipulation. A number of people who have left teacher training colleges with qualifications in the arts are unable to get jobs. Assuming that they left teacher training college at 21, there is a seven-year gap before they are eligible to apply under the scheme. Will the Government look at that?

In view of the fact that £200 million of public money is involved, will the Secretary of State tell us how many people have started courses under this scheme for the training and retraining of teachers, as publicly stated by the Department of Education and Science?

As to the future of skillcentres and teacher training colleges, I note that in paragraph 4.46 of its report the Manpower Services Commission does not think that there will be much further development of skillcentres of the traditional kind, providing a minimum of 150 places. It is indicated, however, that there is a possibility of smaller skillcentres, or of facilities shared with other training bodies serving smaller towns in rural areas where the need to move away from home has, up to now, sometimes deterred potential applicants ".

That is certainly recognising a problem. Many people find that the skillcentre is too far from their home. I wonder whether there has been consultation with the relevant Departments about converting into skillcentres those teacher training colleges which are being closed down. Some of them are sited in rural or semi-rural areas, and it would be a sensible way of overcoming this difficulty.

Tied in with that question, and with skillcentres and the future of training, is the mobile instructor service. In para. 4.56 of the report, on page 36, the Commission states that in 1976 this service provided training for over 2,000 workers on employers' premises ". I believe that more could be done in that respect.

Many employers would welcome the opportunity of making use of the facilities of the mobile instructor service. It is a question of cost. At present the service is free. Ought there to be a charge made, and should it be partly shared between employer and Government? I pose that only as a question, but from the success that the scheme has had, albeit limited, and the knowledge that I have of local industries in my area, I believe that there is a considerable future for the mobile instructor service as now provided.

As to the new special programmes for unemployed people, I gather that fairly soon the MSC will produce mark II of its document—" The new special programme for unemployed people … the next steps ". I believe that the Secretary of State said that before Christmas the Government would make an announcement about that. The period of consultation indicated in the first document, which came out in July, was up to 30th September, so that everything had to be in by then. On training, the emphasis in that document is on the number of people who will be needed. Foremen training people on employers' premises will not have had any experience of that kind of work. How much training will be provided before the start of the scheme? Will those running area boards be senior civil servants, and how much training will they require?

I think we have to accept the view that nearly everyone felt that there would have to be some form of training given if the scheme were to be properly implemented. Given that the Government want it to be off the ground by September 1978, will a sufficient number of people have been trained?

Concerning finance, is there not a case for funds being released before next April, as premises and equipment must be acquired? Six months from April to September will not be long enough. If the scheme is to cater for 230.000 people, premises and equipment will form an important part of it. To date, no funds have been released. When will they be released given the need for equipment?

A special effort will have to be made, if the Government go full ahead on this, to reach the unregistered young unemployed people. The whole emphasis has been on the provision of a skill to a very much larger number of people, but the very people who have not a skill are often those who have left school and have not registered as unemployed. It is important for the unregistered young unemployed to be reached by the scheme.

I have two points to make to the Government on what is happening in the countries of the European Economic Community. They relate to how we can persuade employers to take on more young people. The French have a scheme whereby, for the first job for a young person under 25, the employer is relieved of all social security payments for that person. We have something roughly like that, but I should be interested to know whether the Government have studied the French scheme or think that it could be adopted here.

Secondly, there is a scheme in Belgium whereby a person taking early retirement —retiring at, say, 62—must be replaced by someone under 30.

In paragraph 4.5 of the MSC report, on page 37, there is mention of the development of training methods and dissemination of training knowledge ". What has come out of that? In the event of the scheme outlined in "The Next Steps" being launched, a great deal must be learned about whether the right training methods are being adopted.

The Under-Secretary of State for Employment wrote to me in August on that point, stating that information from the University of Warwick research projects on the effect of new technology on jobs was not yet available, and that he hoped it would be available very shortly. Many speakers in the debate have said that much of the unemployment is caused by the effect of technology on jobs. I know that the Government have gone to the expense of setting up this unit in the University of Warwick. What information is now available from it?

The relationship between the Department of Education and Science, the Department of Employment and the Manpower Services Commission has come into many of the speeches in the debate. A very important point is whether the careers service should or should not come under the wing of the Manpower Services Commission. It is vital that before people leave school they should have a much greater knowledge of what can be done for them if they find themselves in the unfortunate position of being unemployed.

The report is full of the many schemes that arc being launched by the Manpower Services Commission. Not all of them are perfect but no one could accuse the Commission of a lack of energy. My anxiety is that some people who leave school do not know of the range of projects and opportunities that are available from the Commission. Anything that can be done to get the MSC into the schools to explain the problems of the economy and the opportunities for retraining people should they be unemployed would be welcome. We must not be shy or indecisive about this problem. We must retrain massively if we are to bring down these hideous unemployment figures.

7.41 p.m.

Mr. Joseph Ashton (Bassetlaw)

The House may think that it is unusual for me to speak from the Back Benches. I resigned my position as a Whip this morning. That was not because of an immediate difficulty with the Government. I indicated some time ago that I wished to return to the Back Benches. However, the situation has become more pressing this week because of events in my constituency due to the power workers' dispute.

My constituency contains the Trent Valley power stations, which are the biggest in Europe and employ hundreds of workers. Any one of those power stations is big enough to light the whole of London.

There has been a long-standing grievance among workers in the power stations, particularly those in the rural coalfields. In many cases it is difficult for workers to travel to their power stations because of the lack of public transport. Comparison has been made between the power workers and the miners. The miners receive concessionary coal to burn at home. The rents of miners' homes are often one-third that of the rents of electricity workers' homes. Miners often have a subsidised bus to take them to the pit.

The power workers are faced with a different situation. Small villages have been built near some power stations. They often comprise modern houses which are difficult to heat because they have too many windows. That has been a grievance for a long time. In many areas, if a man does not have a car he cannot get a job. Power workers work round the clock on a shift system for seven days a week. The stage was reached when public transport became almost nonexistent. The grievances have festered for seven or eight years. I have raised them with the Chancellor of the Exchequer but apparently it is not his responsibility.

The position became so bad that two years ago there was an attempt to form a breakaway union. One of the power workers' grievances is that in any other nationalised industry there tends to be only one union—one for the railways, one for the pits and another for the Post Office. Because of fragmentation in the power workers' organisations, grievances never reach the top. Four unions are involved. Shop stewards are not recognised as they are in other industries, and the works committees do not have power to talk about pay and conditions with the employers. The difficulties arise because of that situation.

The unions believe that if workers have a grievance they should take it to the local union branch. Normally, that system works. However, a local branch can be 10 or 15 miles away from a man's place of work, and because of shifts workers often cannot attend meetings. Rural branches usually include workers in other small industries, and the electricity workers' grievances take a back seat. The grievances grew and an unofficial committee of shop stewards was set up. They got together to push their claim against the wishes of the union and the electricity board.

The British electricity industry is probably one of the finest in Europe, if not the world. Unlike other industries, it does not suffer from such ailments as over-manning, lack of investment and flexibility, and strict demarcation lines. The response of the workers has been magnificent.

In the last 10 years the number of national joint industrial council staff employed has fallen from 41,000 to 31,000. In the same period the number of power station employees per megawatt produced has fallen by 52.9 per cent. The number of units per power station employee has risen by over 76 per cent., and the total number of units supplied has increased by nearly 34 per cent. Thermal efficiency has risen from 27 per cent. to 31 per cent. The number of people employed in the industry has dropped from 132,000 at the time of Wilberforce to 87,000.

That is a magnificent record for the workers in the industry. It has been combined with an investment policy which has created one of the most efficient industries in the world. If every other industry was as efficient, there would be no problem about creating wealth. However, things have gone wrong and the situation has turned sour.

We must ask why people are now sitting in the dark. It is because a total lack of communication now exists in the industry. Six or seven years ago, a productivity agreement was introduced which meant that men would agree to do different jobs in different areas. For example, a crane driver could be asked to sweep the shop floor. He would be paid an extra £7 or £8 a week for that.

However, the men felt that their claims for concessionary travel and electricity were not being put in the proper quarter, and they began to work to rule. They said that they would not operate the productivity and pay agreement. They said that until they were given concessionary travel and electricity a crane driver who was asked to sweep a floor would say "No ". This decision had an effect on the electricity industry which was brought rapidly to a climax last weekend when the management of one power station stated that workers were breaking their agreement and that if they worked to rule they would not be paid.

A letter from the management of the Drax power station stated: Those staff taking unofficial industrial action are not complying with the NJIC Agreement which is incorporated in their individual Contracts of Employment, and are working to rules of their own making. They are, therefore, in breach of Contract and will not be paid until they resume normal working.

The men's reaction to that was that the board was acting wrongly. The board was entitled to stop the £7 or £8 because the men were working to rule—that would have been within the agreement—but it was not entitled to stop the full pay of a man who had done a full day's work at his normal job. That led to a strike at West Burton. Over the weekend, nine power stations went on strike and a further 60 were involved in the dispute.

Because of the three massive power stations in my constituency, and because I have close personal contact with some of the shop stewards involved, they asked me to attend a meeting of shop stewards held in Doncaster on Monday afternoon. I went in the hope that some sort of link would be available with Westminster and that some sort of bridge could be built. I did not go and could not go in any official capacity. There were 26 shop stewards present. I put it on record at once that those 26 shop stewards are not raving, militant men out to smash the country; they are not politically motivated subservients out to smash the capitalist system or anything of the sort. They are ordinary, decent workers who felt that their voice was not being heard either because of the bureaucracy of the board or because the union structure did not allow it.

Many of those workers were conscious of what was happening, with power supply being cut off. They, too, have elderly parents whose supply gets cut off. They were often being abused and spat upon by neighbours in local supermarkets and they were anxious that the dispute should be brought to an end.

After three or four hours' discussion, there was an overwhelming vote that the men would return to work under normal working conditions provided that they could get three assurances. They did not ask for very much. They were in a position to demand very much more, but they asked only for three concessions. The first was that the loss of pay for the people who had been sent home for working to rule should be reinstated. In other words, if a crane driver had done a full day's work as a crane driver, even if he had not co-operated in the bonus system by sweeping up, he should get his pay. After all, even though the power station was working only partially, electricity was still being sent out and the board will send out the bills and the customers will have to pay. Such a gesture by the board would have cost very little compared with the millions of pounds a day that it claims to be losing while the dispute continues.

Secondly, the shop stewards asked that when the official negotiations on the pay claim begin in March, instead of a flat 10 per cent. being thrown at them there should be a chance also to talk about concessionary travel to work and concessionary electricity, shift allowances and so on. Thirdly, they asked for better recognition for workers on the shop floor, either at shop steward level or through other workers in the industry.

It appeared to me that those three points would be acceptable to the Government. Better recognition for shop stewards was mentioned in the Gracious Speech in the reference to introducing worker democracy into the nationalised industries. It would not mean that they would take over from the heads of the trade unions. It would mean that the management would listen to them when they had a complaint or grievance. Democratisation in the nationalised industries is now Government policy and should be accepted.

Again, there was no reason why the men should not have on the agenda for the March pay negotiations the problems of concessions. It was a matter for the board, therefore, whether it wished to say "As this was a work to rule, we will not pay the extra £8 productivity bonus but we will pay the basic wage to those who turned up." The Government have introduced a tripartite agreement for the gas industry which brings in the Government, the industry and the workers, and there is no reason why such a system should not be introduced in the electricity industry as well.

Those shop stewards would have been satisfied with those three concessions. They said "We will take a couple of days to open the channels. We will go back to work at 10 o'clock on Wednesday night provided that these things can be introduced." What happened? The board has stood on its high horse and said "We are not going to pay for those days when people turned up to work and worked to rule even though they did work. No concession and no payment can be made to these employees." That is asking for trouble.

The men have held out the olive branch. They have said that they will go back to work. We know the attitude of Mr. Toombes and Mr. England. It is quite incredible that the bosses of the industry cannot accept the olive branch, get the power back on and carry on the talks in March. But they are adamant that they will not pay for those days of work to rule.

I have been in touch with the secretary of the unofficial committee today. The Yorkshire shop stewards are to recommend at their next meeting on Friday a total stoppage, which is a very serious situation. At last Monday's meeting in Doncaster there were recommendations, all of which were turned down, that notice should be given that the shift system would be stopped—in other words, the men would work regular days but not evenings and weekends. That would instantly bring power supply to a halt. As I have said, that proposal was rejected, as were motions to scrap the bonus productivity scheme.

These men have leaned over backwards to come to some sort of terms and go back to work with dignity and respect, but the board does not even talk to them. It only puts things in the newspapers, and there is no communication. We are now entering a serious situation because the board will not pay for work that has been done as it was done under the work to rule. There are two consequences of the board's action. First, the dispute will continue. Either the work to rule will go on or, if the Yorkshire shop stewards have their way, there will be a total unofficial stoppage.

The alternative consequence of the board's action is that the men will be defeated and go back to work bitter, angry and determined that at some time in the future they will get revenge. What an atmosphere to build up for the pay talks next March. For the sake of a few pounds and a few concessions, the board is going to build up a bitterness in those March negotiations which will cost it 10, or perhaps 100, times more. The men will say "We will get our money back for November and show who is boss."

At the moment, work is being continued at power stations by staff unions, so the board thinks that the men's action will fail. But the board should remember that the staff unions themselves have put in for pay rises of 20 to 25 per cent. When it comes to the March settlement and the official round of pay talks, the staff unions will not be available to keep the power stations running. By that time, the whole amosphere will have soured and the job of the board, the Government and anyone involved in the talks will be almost mountainous.

I hope that, even at this late stage, someone in the Government can lean heavily on the bosses of this nationalised industry, who seem to have no industrial relations sense, and tell them "Pay the men for the work they did under the work to rule, and then we will start to talk." If the board stays on its high horse, there will be disruption from this weekend onwards. It is time that the people in the board were told by the Government "Pay the money."

Several Hon. Membersrose

Mr. Deputy Speaker (Mr. Bryant Godman Irvine)

Order. I still have a number of hon. Members on my list who have sat throughout the debate, and unless speeches are reasonably brief in the next hour it will impossible to accommodate them all.

7.59 p.m.

Mr. Tim Smith (Ashfield)

I was sorry to hear that my neighbour, the hon. Member for Bassetlaw (Mr. Ashton) had resigned as a Government Whip this morning, but it gave him the opportunity eloquently to put the case of a number of his constituents involved in an unofficial dispute with their employers, and whether one agrees with him or not one sympathises with the difficult situation in which he finds himself.

When my right hon. Friend the Member for Lowestoft (Mr. Prior) referred to the high level of unemployment at present as being a very distressing situation, I was sorry to hear cries of "Hypocrisy" from Labour Members. People outside it have a pretty low regard for the House in the first place, and such abuse hurled across the Floor does nothing to improve the image.

Labour Members should accept that the Conservative Party also regards unemployment as a social evil and wishes to see it eradicated. We might disagree about the means towards that end, but we have equally good intentions. Indeed, the record of the Labour Party in this respect is not all that it might be. The Secretary of State referred to the crisis of 1929–1931 and the great slump. It is interesting to note what my predecessor, David Marquand, wrote about this period of Labour Government in his biography of Ramsay MacDonald. Referring to the unemployment figures at that time, he said: For the Labour Party, which had consistently proclaimed that unemployment was the inevitable consequence of the social order which it alone was committed to transform, and which now found itself presiding over the worst increase in unemployment in living memory, they spelt failure, bitterness and a sense of guilt. It seems that, once again, we have a Labour Government presiding over the worst increase in unemployment in the living memory of many people in this country. As long as this situation prevails, this Government cannot be reckoned to have succeeded, because 1.4 million working people in this country have been let down.

There is an interesting parallel here with the 1929.1931 period. At that time economic orthodoxy was being questioned and had lost ground and finally surrendered to Keynesian economics. At that time politicans of all parties found themselves in unknown territory, groping for the way ahead.

Today I think that Keynesian economics have been discredited. The situation was described earlier by a Labour Member as "a crisis of capitalism ". I do not believe that that is correct. It is simply a change in circumstances. We have seen high inflation and high unemployment escalate together as a result of a change in the international situation. Again, we find ourselves in unknown territory, groping for the way ahead.

This is especially true of youth unemployment, which is perhaps the greatest problem that we face today. I am sorry that there is no reference to this problem in the Queen's Speech. The Conservative Party tabled an amendment referring to it, because this problem has implications not just for the employment of young people, but for race relations, education and urban policy. This is a time for new ideas and constructive proposals from both sides of the House.

First, there is the international dimension. The Government have consistently said—I think with some justification—that part of the problem arises from international reasons. They have said that unemployment is an international probem. All EEC countries have suffered from high unempoyment and high rates of inflation in the past three years. Indeed, the Leader of the Liberal Party said that to some extent it was outside our domestic control. It is true that the continuing recession has been caused to some extent by a fundamental imbalance in the world economy, but it is equally true that EEC countries should have worked out solutions together, particularly in terms of the question how to put to productive use all the excess money that has been shifting around from one international centre to another as a result of the imbalance to which I referred. The reverse has been true in practice. National leaders have withdrawn into their shells and looked purely for national solutions. That criticism is especially true of this Government.

I turn now to the regional aspect of the unemployment problem. It is clear from what has been said earlier that this problem is concentrated in clearly definable areas—largely in the centres of big cities. Therefore, there is a need to direct resources in that direction. I doubt very much whether our regional policy does this effectively at the moment. For example, Ashfield has an unemployment rate of 4.4 per cent., which is well below the national average. However, it is an intermediate area for industrial assistance—I believe it is the nearest to London—and, in about a fortnight's time, the Secretary of State for Industry is to visit the area to plant a tree at a new Kodak factory which will employ 2,000 people.

I am very pleased to see so many Ministers coming to Ashfield. Two weeks ago we had the Minister of State, Department of Health and Social Security, and on Friday we are looking forward to welcoming the Minister of State for Employment, who is to open our new jobcentre.

One result of the opening of the new Kodak factory in my constituency is that other firms are complaining about the loss of labour to the new employer, because workers are being tempted away by higher rates of pay. It is a crazy situation. Ashfield is an industrially assisted region which is not at the moment in need of that kind of help, but Nottingham, only a few miles away, has all the problems of urban deprivation.

Mr. Leslie Spriggs (St. Helens)

I hope that my right hon. and learned Friends on the Front Bench are taking particular notice of what the hon. Member for Ash-field (Mr. Smith) has said, because there are literally thousands of firms all over the country which should have apprenticeship training schemes but do not have them. They are taking from thousands and thousands of school leavers the opportunity to be trained in certain skills. Instead, the firms are literally poaching highly skilled workers to satisfy their own needs, and robbing other industries. The hon. Member for Ashfield is right. He should press his point home.

Mr. Deputy Speaker

Order. My appeal for brevity also applies to interventions.

Mr. Smith

The reason is quite clear. Contrary to what the Secretary of State said earlier, there is actually a shortage of skilled labour. I know this from working in my own engineering company and from what employers have said in my district. There is a shortage of the kind of skilled labour that is required. We have a skillcentre which is doing what it can to meet employers' requirements, but there continues to be a shortage of trained people.

Finally, I wish to say something about the bureaucratic aspects of the proposals from the Manpower Services Commission on youth unemployment. We have had the Holland Report and the acceptance of its main recommendations by the Government, the youth opportunities programme and the special temporary employment programme. Now we have the MSC's discussion document which was referred to earlier.

I am pleased that the Secretary of State dealt with a number of points that were of concern to hon. Members on both sides of the House. First, there was the question whether the area boards would be too remote. I think that the right hon. Gentleman dealt adequately with that, although it would be good to see the involvement of young people in it. The annex to the document suggests 21 area units. As long as we are given the undertaking that there will be effective local involvement and control, I do not think that there will be any objection to that, I think that it will be accepted because we need to get some degree of accountability. Something referred to in the Holland Report but not referred to in the consultative document is the involvement of young people in those programmes, so that they would be relevant to the needs of the people concerned. I think that the Secretary of State has allayed our fears on that point.

The question of training was referred to by my hon. Friend the Member for Bedfordshire. South (Mr. Madel). According to the Secretary of State, there will be a requirement for 8,000 people to conduct training throughout the country. Apparently these people will be drawn from the present pool of unemployed. They are not at present working as trainers or instructors. In the short time available—a good deal less than a year —I should like to know how we shall find all these people who will be qualified to train and instruct other people.

I wish to make one comment about the MSC Review and Plan. Paragraph 2.29 of the plan refers to the fact that the MSC does not wish to become involved in economic policy. It then says that by 1982 the Commission will have 29,000 staff and will cost £700 million a year to run. As the Secretary of State said, there are jobcentres. skillcentres and a tremendous amount of work in which the MSC is involved, but we must be concerned that it is the Secretary of State and not the Commission that formulates Government policy and we must have proper parliamentary control over the way in which this large sum of money is spent.

We need an employment strategy to complement the existing industrial strategy. The industrial strategy is confined to manufacturing and may create no new jobs. The Secretary of State accepted this, although he said that jobs would be created in other sectors, both in the supply of raw materials and in distribution. It is clear that any new jobs will be in service industries and, we hope, construction.

The promotion of small businesses has at last been recognised by the Government as a potential area for additional jobs. Let us hope that these factors are taken into account and that the Government will produce a positive employment strategy to overcome the difficult period that lies ahead.

8.11 p.m.

Mr. Max Madden (Sowerby)

The debates of the past few days have included numerous references to unemployment, and today's debate gives us an opportunity to consider the problem of unemployment in more detail. If nothing else, I hope that from the debate the message will go out to the people of this country that unemployment is structural and endemic, and will be long-term. There are no easy or instant solutions to reduce the level of unemployment substantially from that which we have endured in recent years.

In this regard, it is useful to look at the comments made recently by Mr. Geoffrey Holland, the planning director of the Manpower Services Commission. The Minister who replies to the debate should tell us whether the Government accept the Commission's estimate that, as Mr. Holland said at a conference last weekend, 1,000 new jobs will have to be created every working day if unemployment is to drop to 800,000 by 1981. Mr. Holland said that to provide enough jobs for the young people leaving school by 1981, the Government would have to extend early retirement, introduce work sharing, or end the employment of those aged between 16 and 19. We should be told whether the Government accept that philosophy.

I suspect that the MSC's work opportunities programme is not a temporary phenomenon but will be a long-term and expanding programme, embracing an increasing number of young people in the years ahead.

I had hoped that the debate would give us some information about the Opposition's alternative policies for dealing with unemployment. The hon. Member for Falmouth and Camborne (Mr. Mudd) asked what he could tell his constituents about the level of unemployment in the months and years ahead. The Opposition should tell us what are their policies for dealing with unemployment.

I have some regard for the right hon. Member for Lowestoft (Mr. Prior). I look back with some pleasure at a Sunday newspaper article that described him, some months ago, as a top Tory with friends in low places. The right hon. Gentleman has done much this summer to knock together wooden heads in the Tory Party and to give them some understand of industrial relations and the industrial realities of the world in which we live. We should be grateful to him for that.

Unfortunately, we cannot be grateful for the right hon. Gentleman's speech in opening the debate today. We had from him a diverse ragbag of policies that could not be called a coherent strategy for dealing with unemployment. He commented on the need to deal with dumping. I do not grumble about people becoming converts, but many of us on the Government side of the House have been campaigning for many years for vigorous action on clumping—without the pleasure of the hon. Gentleman's company. I suppose that we should be grateful that he has at last caught us up.

However, I should like to ask the right hon. Member for Lowestoft whether he believes that our ability to deal with dumping will have been helped or hindered by the fact that from 1st July, responsibility for dealing with dumping has been transferred to Brussels and the European Commission. If he feels that this will help us, I must say that I do not share his confidence.

The right hon. Member for Lowestoft also gave us an interesting argument about the need to develop a regional policy. I entirely agree that we need a selective policy of backing science-based, high-technology industries that offer opportunities of creating wealth and expanding employment. However, the hon. Gentleman's arguments should be compared with the Tory Party's policy of smashing the NEB when they are next in power. The NEB is there to do exactly the job that I have referred to. I am pleased to see its role being extended into the North-East and the North-West and I think that it should have a much greater responsibility throughout the rest of the country for identifying industries that need support and financial assistance. The conventional banking institutions and the money men have not shown a propensity to support these high-risk ventures, and unless agencies such as the NEB have the resources and the political will to do it I see no possibility of these industries being supported and offering increased employment.

It is interesting to see the contradictions in Conservative policy. The Conservatives say that there should be new development within the regions and then threaten to smash the NEB as soon as they come to power.

Many people have trotted out easy solutions for dealing with unemployment. One of those used most frequently has been the small business sector. I have enormous regard for the innovative qualities of small businesses. They can do many of the tasks that are necessary in the areas to which I have referred. But there are only 70,000 small companies in the manufacturing sector, and we cannot expect that they will provide a solution to unemployment. It is a fiction to pretend that they can.

The comments of the right hon. Member for Lowestoft on the Employment Protection Act were at best equivocal and at worst aimed very much at the heart of the Act. Let the right hon. Gentleman and small business men recognise that there is nothing in the Act to stop them from employing people. An employee cannot make an application for unfair dismissal during the first 26 weeks of his employment, and if an employer cannot ascertain within 26 weeks whether an employee is satisfactory his competence as an employer leaves much to be desired. Those in smart circles who refer to the Act as the Employment Prevention Act should look at the provisions of the legislation. I hope that they will then come to a different conclusion.

Among other suggestions for dealing with unemployment, we have had the argument about growth. I firmly support growth policies. Economic expansion is particularly important. But I would not pretend that growth and growth alone will bring about the reduction in unemployment that we all want to see, particularly when I go to my constituency and see firm after firm operating at 70 per cent. capacity. That is a pattern that one can find in many other parts of the country. Again, it is a fiction to pretend that growth, and growth alone, will create jobs. The fact is that we can have substantial expansion without any increase whatsoever in employment opportunities.

There are also those who argue that it is in manufacturing industry, and manufacturing industry alone, that the promise of jobs lies. That, again, is an illusion. I believe that we must see the structural changes that have been taking place within British manufacturing industry and recognise that these difficulties will continue whether or not the Leader of the Opposition trips across the threshold of No. 10 Downing Street.

These realities will persist and the problems that flow from them will persist. Therefore, what are we talking about? We are talking about economic policies and the direction of those policies, and not about personalities.

There are also those who argue that we could bring about a reduction in unemployment if only we could get investment. Again I would argue that modern experience tends to indicate that more and more investment is capital investment and not labour-intensive. That means a falling labour requirement, not an increasing one. I would also argue that increasing competitiveness in British industry is not all to do with unit costs; it has a great deal to do with improving the design of British goods, the quality of British goods and the delivery dates of British goods. To a large extent, certainly with regard to exports, price is not of overriding importance.

The most important question that should be answered tonight is: what, in percentage terms, do the Government consider as full employment? Has full employment, and the definition of full employment, changed? If it has, for heaven's sake let us know, because to compound the folly of unemployment would be to mislead people as to what is full employment and when it will be reached, certainly on the basis of current policies.

We know that under the Chancellor's proposals expansion in a full year is estimated to be above 3 per cent. We know that the Cambridge School of Economics has been arguing that only if we get 5 per cent. expansion per year until 1985 will we reduce unemployment to below 1 million. We know that the Manpower Services Commission estimates that 1,340,000 new jobs are needed to reduce unemployment to 800,000 in 1981. The people deserve political honesty. They should be told what the definition of full employment is and when they can expect to return to it. As well as needing more economic expansion, more growth, more investment, more help for small businesses, more selective regional policies, greater economic investment, more help for the NEB and all the other measures that we have been talking about, we must return to public expenditure. We must face a situation in which there is an ability to reduce personal taxation. I should certainly like to see a reduced rate band. I should like to see much bigger personal allowances. But if we are not to fritter away the oil revenues we must ensure that they are used to regenerate British industry. They must also be used to restore public expenditure —not only in the interests of working men and women, by providing local services, but to ensure that there are opportunities for employment within the public sector.

When we talk about public expenditure we are not talking about more and more bureaucrats sitting on their bottoms in the local town hall; we are talking about more schools, more houses, and more hospitals, and about improving the social wage for the working men and women whom we represent. I therefore believe that we need a coherent economic and industrial strategy if we are to win this battle against unemployment.

Above all, we need political honesty. We need to talk to the people about the problems that are endemic within our economy and that we have been discussing in this debate. If the Labour Government do not do so, it is apparent from what we have heard from the Tory Benches this afternoon, and every day of every week, that there is no alternative from their side of the House.

These problems are complex and complicated. I believe that the solutions lie only in the hands of the Labour movement and the Labour Government. I believe that at some stage we shall have to return to planning. We shall have to return to a concept like George Brown's National Plan, or a Department of Economic Affairs, in order to take the levers of economic power and policy-making from the Treasury and to ensure that there is an independent economic agency that is not tied to Treasury orthodoxy. We shall have to develop a highly interventionist economic and industrial policy if we are to overcome these problems.

We live in extremely difficult times. This debate, as well as previous ones, clearly demonstrates that solutions must be found. It is no good saying that only a tax-cutting orgy, in which the standard rate of taxation will be cut, will solve the problems. That, roughly speaking, is the central position occupied by the Conservative Party. I do not believe that they will solve the problems. I believe the sort of strategies that we have been developing and that we have been arguing for are becoming more relevant. We must return to those policies—planning agreements, the NEB, protection in the Industry Act—because I believe that they are major measures designed for the problems of the 1980s.

We have the policies and the people to implement these measures. What is crucially necessary in that exercise is political determination. I agree with the right hon. Member for Lowestoft, who said that unemployment is a political issue. It is. It is the central political issue that the Government face. Whether they win or are beaten by that political issue will, I believe, determine the life of the Government. It will certainly determine the question who succeeds the Government. I trust and believe that we can be successful, but we shall not be if we continue with illusions and myths. Let us face the industrial realities and let us overcome them. That is only possible with Socialist measures and interventionist policies.

8.28 p.m.

Mr. Esmond Bulmer (Kidderminster)

The hon. Member for Sowerby (Mr. Madden) made so many points that he will not expect me to follow him into the details of his argument. However, I agree with him that the problems are complex, though I do not agree that their solutions can come only from one side. It is refreshing to see at a constituency level how much more meeting of minds there is between all parties about the way to tackle unemployment, and I should like to see it reflected rather more in this House.

I took some comfort from the fact that the Secretary of State for Employment echoed my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) in saying that without argument the task before this country was to achieve overseas competitiveness and that we had to be competitive. That is the point from which I should like to start tonight.

The TUC has also, to the extent that it has endorsed the Manpower Services Commission's report, recognised this fact. I do not underestimate the difficulties for the TUC or the trade unions. We all know that the present Government have given great new powers to trade unions and that it is traditional for trade union organisers to use their power to protect to the limit the right of the individual worker to maintain low productivity. In some industries that is so, in others it is not. But there is a consensus among all our international competitors that one of the biggest obstacles to our recovering our competitive edge is our system of industrial relations.

It is 13 years since the Donovan Commission was set up. Some of its recommendations have been enacted through the Trade Union and Labour Relations Act and the Employment Protection Act. I hope that many of those will now stand. But there is also a great deal of unfinished business—the reform of collective bargaining, the enforcement of agreements, the problems of multi-unionism, restrictive practices, picketing and the protection of the rights of individual workers in the closed shop. Many of these problems are extremely complex, and some of them are also highly contentious.

It might be helpful to convene a reconstituted Donovan Commission so that at least there was a body, representative of both sides of industry and knowledgeable about the issues, continuing to seek solutions, which I do not believe can be imposed from either side. It is a long, hard struggle.

I would hope that a reconstituted Donovan Commission would point to what I think most people believe: that it is far too easy to strike and that the abuse of monopoly by labour is no more acceptable than it is by capital. When they return to their constituencies, hon. Members are very aware of public resentment at this time over the power cuts. The public have a great fear that the fire service may go on strike. I do not want to say anything that might exacerbate that situation. But the Government must understand that the public may put up with losing" Match of the Day ", although they are not pleased about it; they accept the loss of export orders and they will just, perhaps, put up with continuing inconvenience, but they will not put up with having the lives of their relatives put at risk. It is no solution to say that the troops can be brought in if matters reach a certain pass. The Government must be able to point to their seeking a lasting solution, and not one which is left entirely to the TUC.

I know that there is a great reluctance to set up such bodies as Donovan. I fear that the Bullock Commission has made it even more difficult with its loaded terms of reference and partisan composition; these have undermined confidence to some extent. But I liked a letter inThe Timeswhen the terms of reference were first published. The writer suggested that the terms of reference should have been: Accepting the need for a radical improvement in the effectiveness with which wealth is created and for a significant improvement in our industrial performance compared with that of many of our continental partners: how can this best be achieved, taking into account the needs of the national economy, employers, employees, investors and consumers. The Secretary of State could rewrite that as he liked, but if he would consider setting up a body that would look hard at why we have failed to invest, at our industrial relations problems and at how to improve our competitive edge, he would certainly have my support.

8.33 p.m.

Mr. Ron Thomas (Bristol, North-West)

If the hon. Member for Kidderminster (Mr. Bulmer) looks at the statistics, he will find that for every 1,000 workers we lose fewer days through strikes than do most of our industrial competitors. Secondly, the biggest strike we have had, which has been far more catastrophic than days lost through industrial disputes, is the strike of British capitalists, who have refused to invest in British industry and have invested in land and property speculation and have invested overseas or in commodity markets, currency or what-have-you. Thirdly, if the definition of a strike is "not reporting for work at the place where one should be ", the House of Commons has probably the worst strike record of any firm in any country.

Before I come to the main amendment, to which I wish to speak, I should like to make a quick comment about two other amendments which are on the Order Paper. First, there is an amendment which regrets that we are not bringing the ports into public ownership. I should like to express my regret that we have reneged on our 1974 General Election pledge. Secondly, I should like to draw the attention of the Leader of the House to the amendment in my name which regrets that the Gracious Speech contains no proposal to restore to cities like Bristol the functions taken away under the Tory Local Government Act, including education, planning and social services ". If we are to spend a considerable amount of time considering devolution to Scotland and Wales, it is a great pity that we cannot spend a little time on the kind of legislation that would give a bit of devolution to the citizens of Bristol and other similar cities who lost control of planning, education and social services under a disastrous local government reorganisation Act, which has continued to be used against those of us on the Government side of the House who have fought against the cuts in public expenditure.

Mainly, however, I should like to address my remarks to the amendment on the Order Paper in the names of myself and of some of my hon. Friends which deals with the failure of the Government to give an undertaking that they will restore the cuts in public expenditure, linked with more effective measures to reduce unemployment; and further regret that there is no mention of amending the law relating to trade union recognition and rights, in order to prevent Grunwick-type employers from evading the intentions of the Employment Protection Act ". I take the last part first. I think we all agree that the Employment Protection Act has proved in practice to have considerable gaps. One area, clearly, is the proliferation of all kinds of bogus staff associations. That ought to be dealt with. The legislation urgently requires admendment. Another area is quite clear-cut. That is the Grunwick-type situation. I am critically disappointed that the Government have not said that they will introduce legislation to deal with the defects in the Employment Protection Act which have created the Grunwick-type situation and will not be introducing amendments to give far more power and authority, clearly established, to ACAS and other institutions set up under the Act.

However, I am mainly concerned with the whole question of unemployment. It seems that we face a situation of economic indicators predicting the stark reality of over 2 million jobless in the months ahead. A spokesman for the Manpower Services Commission has suggested recently that there could well be 450.000 youngsters, straight from school, in the dole queues by the third quarter of 1978. Jack Jones has recently pointed out that at present about 700,000 of the unemployed are aged under 25.

In my judgment, if one looks at a, detailed breakdown of the unemployment figures, one sees that it produces clear evidence of the bankruptcy of the present kind of Treasury orthodox policies and, indeed, the barbaric nature of the capitalist system. While imports of finished and semi-finished manufactured goods flow into Britain, there are about 350,000 workers unemployed in manufacturing industry.

While I am all for training and retraining, I believe that quite often the bosses in British industry create the myth that they cannot expand because they cannot get trained workers. In actual fact, we have been in this kind of scene from about 1966 onwards. Between 1966 and 1970 we set up industrial training boards, big NEDCs and little NEDCs, this, that and the other planning council and goodness knows what. We are still saying that we are short of skilled workers. At the same time as we see the clear need for hospitals, schools and other capital projects in the public sector, there are at least 300,000 workers in construction and related industries who are unemployed. Even at this moment almost 100.000 young people have left school to join the dole queues with their bright hopes and aspirations blunted. As my hon. Friend the Member for Sheffield, Hillsborough (Mr. Flannery) has reminded me, it seems rather strange that we encourage youngsters to leave school knowing full well that they will not get jobs but hoping that they will get £9, or whatever it is, in supplementary benefit, but that if they stay on at school we cannot give them a penny. It seems a bit of nonsense that we are encouraging them to leave school sooner than they might otherwise do simply in order to get £9 supplementary benefit.

In looking at the cost of unemployment in Britain, we do not need to be econometricians simply to take 1½ million unemployed and to suggest that if they were at work they would be creating about £3½ billion worth of goods and services a year. That is no very small figure. On that basis, we shall be losing at least £5 billion worth of goods and services. But it is not simply that. We are also paying them almost as much not to go to work. We are really talking about a cost of anything up to £10,000 million, and it puts into the shade the kind of arguments which the Treasury mandarins put up about the public sector borrowing requirement.

I do not expect the Secretary of State to come up with easy and quick-fire solutions, but I suggest that from a Socialist Secretary of State we should be able to expect certain measures. First, we should be able to expect any kind of economic and industrial analysis to make the present indefensible level of unemployment a clear indictment of the British capitalist system. It is all very well for the Opposition to say that it is not an indictment of capitalism. if they are asked why, they say that unemployment is due to changed circumstances. That was one revelation that we have had. Others say that it was due to the fact that certain investment opportunities have worked hemselves out. Very well. Let us accept that as a reason.

So the capitalist system is one in which periodically we have investment opportunities, and when they have worked themselves out we go into depression and have to accept 2 million unemployed. Other Opposition Members give us no reason why we have unemployment. But I think that it is a clear indictment of the British capitalist system and an indictment of the kind of laissez-fairepolicies and the militant monetarism which have been pursued. That kind of" sunshine round the corner "mentality does not help us.

Secondly, we should expect a Socialist Secretary of State to expose the myth which has been created by the Tories that somehow the unemployment is due to Socialist measures. Some of us have been sitting here week in and week out waiting for Socialist measures. The only suggestion which the Tories can make is that the Employment Protection Act might mean that some unnamed small business man somewhere will not take on new workers. That has been dealt with already. I add only that, if there are employers who cannot even meet the very limited provisions for job security and so on under the Employment Protection Act, they should get out of business. That would he my message to them.

We should expect a Socialist Secretary of State to expose the hypocrisy and crocodile tears of the Tory Party, whose members want to cut public expenditure even more and who refuse to give their support to the Government in any kind of measure to protect employment.

What is more, a Socialist Secretary of State can ask them, if the level of unemployment is not an indictment of capitalism, why there are 16 million unemployed in the Western capitalist world and why are there 6 million unemployed in the European Economic Community. Why is it that Western Germany, which has the lowest level of inflation, which has passive trade unions which co-operate with the Government, which has sent back hundreds of thousands of immigrant workers and which has a rate of growth of 3 per cent. or 4 per cent., still has more than a million unemployed?

That is not the way for us. That will not deal with our problem. We do not intend to tolerate a million unemployed—[HON. MEMBERS: "We have more than that. "] When I say "we ", I mean Government supporters who sit below the Gangway. We have never tolerated unemployment. We have exploited every opportunity in this place to try to get the Government to change their policies. At least the Opposition should be prepared to admit that.

We should also expect a Socialist Secretary of State to say that, whatever mistakes they have made in the past, the Government now accept that it is a myth that simply to create the right kind of market and the right tax incentive environment will result in British capitalists rushing forward like nineteenth-century innovative entrepreneurs to reinvest in British industry. The Prime Minister of the last Tory Government gave them all that they wanted, and still the level of capital investment went down and they refused to invest.

A Socialist Secretary of State should also say to his colleagues here "We also accept now what you said about the cuts in public expenditure. You said that they would not be transferred to manufacturing capital investment and exports and that there was no mechanism in the capitalist system to transfer the resources that we cut back in the public sector to capital investment and exports. You were right. It has not happened."

Let the Government be big enough to say now "We admit that it did not happen." They said that they intended to cut back public expenditure in the hope that the resources could be diverted into capital investment and exports. They have not been. We have the ludicrous situation of one civil servant sacking people and another saying "Come along on Monday for some kind of job release scheme or some other palliative that the Government have devised."

The Government should also be prepared to admit that the myth has been exploded that wage increases lengthen dole queues. What has lengthened the dole queues is the lack of effective demand in the economy and the fact that the trade union movement accepted stages 1 and 2 which made a considerable cut in effective demand. This has been an important element in the increase in unemployment.

The Secretary of State mentioned overtime. I hope that he will tell us exactly what he meant. He is right, of course, in saying that 16 million hours of overtime are worked each week. But I hope that he is also saying to the trade union movement "Negotiate with your employers tomorrow to give up that overtime, but you will still get the same level of earnings that you got previously." However, if he is asking workers to take a cut of £10 or £12 a week in their total earnings, we shall immediately get a cut in effective demand and in increase in unemployment. That may result in employers taking on additional workers, but it will not make any difference to the overall effect in terms of total unemployment. If my right hon. Friend is saying "Do not work this overtime, but you can still have the level of earnings that you had previously ", he will have the support of me and my hon. Friends.

I know that the Chancellor has always rejected the unacceptable social and economic costs involved in deflationary policies, the use of cuts in living standards and unemployment as economic regulators. That is the sort of thing that we expect from Conservatives and it is what we continue to hear put forward by them.

I hope that my right hon. Friend also accepts that many of us are fed up with sitting listening while more people join the dole queues and while we hear arguments from him about monetary aggregates. M1, M2, M3 and so on. It seems that we have more M1s and M2s than we have motorways in this country. It is not simply that we are fed up with continuous economic statistics from Treasury mandarins that are always wrong—the one certain thing is that the estimates are always wrong. It is not simply that the public sector borrowing requirement includes the £4 billion to £5 billion that we are paying to people not to work, or the massive handouts to private industry. It is that the Government have been gripped by this monetarist economic analysis which has about as much relevance as had those who believed sincerely that the economic depressions of the past were caused by sunspots. There were well-known economists who believed that.

Surely, only a Socialist economic strategy now makes any sense. We should begin to implement our proposals in the terms of economic planning that were set out in Labour's programme for 1976. We should strengthen the National Enterprise Board and we need planning agreements. Why is it that the Government have powers to stop employers making wage increases but are afraid of using their powers to make firms sign planning agreements? The Government should take immediate measures to bring about planned reflation and, at least, to restore public expenditure cuts. We need to deal with import penetration of finished and semi-finished manufactured goods, we need, strict control over the export of capital, and we should harness our overseas assets.

We cannot defend sterling on a mountain of hot money flows. We should tell the trade union movement to get on with the job of looking after the interests of its members, free of Government controls. To suggest that this will lead to sky-high wage claims is nonsense.

I agree with my hon Friend the Member for Sowerby (Mr. Madden). Let the Government now come clean Let them tell us whether they have dropped the concept of full employment from their economic thinking. Let them admit that this is a crisis of capitalism with which they cannot deal without real interventionist and Socialist policies, and let them tell the trade unions that one of the biggest contributions they can make is to get a 35-hour week throughout British industry as quickly as possible.

8.52 p.m.

Mr. Marcus Kimball (Gainsborough)

. I thank the hon. Member for Bristol, North-West (Mr. Thomas) for giving us the gospel according to the Tribune Group. It is only when one considers employment that one realises that the temporary euphoria about the nation's economic prospects is not justified. That euphoria at the moment has done no more than encourage miners, power workers and seamen to go for more than 15 per cent. wage rises over the last two weeks

Pay settlements are the key to the employment position in Britain. Altogether, 350 phase 3 pay settlements have been made within the 10 per cent. guideline and that proves that the Government's unauthorised sanctions have been effective in many cases. But we have seen Fords settle for 12 per cent. and the air traffic control assistants for 15 per cent. Unemployment now totals more than 1.5 million, and even with the mini-Budget, which gives us only a 3½per cent. rise in the GNP, we can see no improvement in the employment situation. The rise in the exchange rate will make the going even tougher for some firms.

I wish to describe the serious situation in Gainsborough. In that town, 7.2 per cent. of the insured population is now unemployed. The figure for the East Midlands area is 5.7 per cent. Our high level is no reflection on the enthusiastic staff of our local employment office. They have a sound local knowledge. Can the Minister, however, do something to expedite the promised new jobcentre? It is high on the list of priorities, but we need it now, particularly since Gains-borough has become the receiving town for skilled engineering staff under the employment transfer scheme.

We have high unemployment in the construction industry. If the Government want to help constituencies such as mine they must do more for that industry. The only way to have a more immediate effect on local unemployment is to do something to encourage house building. That has a high employment content and it can be started up quickly.

I am grateful to the Minister concerned for the advance factory which is being built in Gainsborough, but I ask also for a promise that if and when the Department of Trade's local office finds a tenant for that factory we may have the go-ahead for another to follow on its heels.

It is difficult to argue the employment statistics in certain parts of my constituency, because of the new county boundary and the fact that the Booth-ferry district comes under the Scunthorpe, Doncaster and Gainsborough offices. We need statistics to cover the Boothferry employment situation in order to back up an application for a grant from the European Development Fund for the industrial estate at Sandtoft aerodrome but we are hampered by the rigidity of the lines for the drawing up of employment statistics.

If the Secretary of State will look at those two matters, I shall be very grateful.

8.55 p.m.

Mr. Martin Flannery (Sheffield, Hillsborough)

The hon. Member for Gains-borough (Mr. Kimball), who spoke so feelingly about the Tribune Group, knows far more about blood sports than he does about economics. I shall speak, as my hon. Friends have done, about unemployment, and I start by underlining what my hon. Friend the Member for Bristol, North-West (Mr. Thomas) said. When the Opposition talk about strikes they would do well to remember what he pointed out—that the longest strike that we have ever had in our history has been and is the strike of capital. Unless the capitalists can be assured of massive profits, especially when a Labour Government are in power, they restrict investment in order to try to topple that Government and use the investment abroad, wherever the trade unions are weak, so as to get the highest profits, while pouring out patriotism by the imperial pint at the same time.

The causes of unemployment are simple, yet they seem to present enormous complexity to the Tory Party. If there is an inability to buy back goods that working people produce, those goods will stay in the warehouses and not be sold, and the workers who produce them will be laid off. It is as simple as that.

Therefore, unless sufficient wages are given to working people to buy back the goods, those goods will not be bought and more workers will be laid off. The solution to the problem of putting people back to work lies in making the economy viable by increasing the wages of working people more than is being done at the moment.

I have heard all this debate, except for a few minutes, and I have noted how utterly barren the Opposition are of solutions to the problem confronting us. Not one hon. Member opposite, with the exception of the right hon. Member for Lowestoft (Mr. Prior), has made any attempt to offer a solution, and all that he did was to talk of bigger public expenditure cuts. I challenge the Opposition, as I have challenged them time and again in the past. They have said that they want bigger public expenditure cuts, and nothing else, to solve the problem. God forbid that we should ever have a Government under Tory leadership, for if we did there would be strikes all over the country because of their inability to grapple with the situation. That is what we should be forced to face—Tory hypocrisy, with promises, promises and promises of more unemployment as a result of bigger expenditure cuts.

The solution is obvious to us all, and it is time that a Socialist Government attempted it. The solution is the restoration of those cuts and higher wages for working people. There is no other solution. If our Government do not do it, they will have no chance at the next election, because the propaganda machine is in the hands of the Tory Party will put out all kinds of wild promises to the floating section of the electorate, saying that the Tories could solve the problem, whereas, in truth, they could only deepen it, because they have no policy.

Unless there is a trend towards bringing the unemployed back into employment before the next election, large numbers of our supporters will sit at home and not turn out to vote to return a Labour Government. The situation is now beginning to burst at the seams. There is a likelihood of even more strikes, because working people are not receiving the money that they are earning by working all day.

As I say, the answer is to put money back into the hands of working people. Otherwise, we have no chance. The Tory Party thinks that this is too simple a solution. In fact, there is no other. I should like to hear from our own Front Bench, as well as from the Opposition, whether there is any solution apart from the one that I have just given, for there are many working people now waiting to hear it.

I cannot, for example, understand the state of affairs in education to which my hon. Friend the Member for Bristol, North-West referred. We are to induce young people to leave school at such a time as this by offering them about £9 social security, instead of giving a proper allowance to all children at school so that they can have something while they are there. We bring them out at 16 years of age and throw them on the scrap heap.

There are now about 30,000 teachers who are not teaching. My right hon. Friend the Secretary of State for Education and Science spoke about 5,000 teachers not teaching, but about 30,000 teachers are not teaching, and about 5,000 are totally unemployed. About 20,000 teachers are doing jobs that should go to other people. What kind of policy is that, if we want large numbers of children to be taught properly and to bring down the size of classes?

Mrs. Audrey Wise (Coventry, South-West)

I am obliged to my hon. Friend for giving way—

Mr. Speaker

Order. I remind the hon. Lady that the hon. Member for Sheffield, Hillsborough (Mr. Flannery) is hoping to resume his seat in a moment to allow time for the winding-up speeches.

Mrs. Wise

My hon. Friend did give way to me. Is he aware that it would require the employment of a further 55,000 teachers to reduce class sizes to 30 pupils?

Mr. Flannery

I am aware of those figures, and I expect a Labour Government to do something about them. Conservative Members may laugh when I talk about making the education system better, but they decry the system to an extent that is beyond reality. We need these extra teachers.

I conclude by saying that unless the Government get working people back into work our chances of being returned to office at the next election will be remote indeed. I dearly want to see the policy that I have advocated being undertaken by the Government.

9.1 p.m.

Mr. Francis Pym (Cambridgeshire)

I shall do my best to wind up this whole debate, which has been wide-ranging, including the debate today on unemployment. We heard an important speech from the hon. Member for Antrim, South (Mr. Molyneaux) and an interesting speech from the hon. Member for Bassetlaw (Mr. Ashton) about the power workers' strike. I am sure that the House will be interested to hear any comments that the Lord President of the Council may make on that speech.

I want to begin with today's debate, because unemployment is undoubtedly the biggest single blot on our landscape. It is a blot for the Lord President too, because in earlier years on the Back Benches his passion was never so evident as when speaking about unemployment. From whichever Bench he spoke, whether from below the Gangway on that side of the House or this side, words flowed out of him as though he really meant them in denouncing the evils of unemployment.

The right hon. Gentleman campaigned outside the House too, in both word and print, and it looks slightly like hypocrisy now. The right Gentleman is a magician with word:—I grant him that—but he has some explaining to do. For instance, in September 1968 he wrote that unemployment has been higher for a longer period than at any time since the war … This is the most outrageous feature of the Government's domestic policy … It is a policy which some of us are determined to fight so long as we have breath in our bodies. In 1971 the right hon. Gentleman said: Many of us in the House and many people in the country regard an unemployment figure of 600.000 as far too high and a total we are not prepared to tolerate."—[Official Report.3rd November 1971; Vol. 825, c. 203.] We know the history of unemployment since then and during the course of the present Labour Government. The figure now stands at more than 1½ million. We heard nothing this afternoon from the Secretary of State for Employment that could be said to amount to a solution. We heard nothing that could be called an employment strategy, as my hon. Friend the hon. Member for Ashfield (Mr. Smith) described it. What we heard amounts to a number of palliatives. The Secretary of State made a strong case for higher productivity. He made a speech the like of which is rarely heard from the Labour Benches. There was also a strong speech on the subject from my hon. Friend the Member for Harwick (Mr. Ridsdale).

What we heard were palliatives. We welcome job creation schemes, we welcome training schemes too, but as my right hon. Friend the Member for Lowestoft (Mr. Prior) said, we do not want training schemes just for the sake of training. The point is that these measures are dealing with the symptoms and not with the causes.

The Gracious Speech states: My Government will continue to take action to reduce high unemployment through manpower measures and to promote industrial training. This is not a basic solution for dealing with the causes of unemployment. There must be a drastic change in economic policy. We have had the beginnings of a change in recent months—undoubtedly due to the IMF. Contrary to what the Leader of the Liberal Party believes, it is not due to his influence. The Labour Government are not enamoured of making any change. They were in pawn to the IMF.

The Lord President must tell us how he justifies his place on the Government Front Bench tonight in view of his support for the Government's economic policy that has led to such high unemployment. He once said that he was not prepared to sit in St. James's Square and preside over mass unemployment. He did not do so. He moved to the chair of Lord President. Is he happy there? He looks relaxed enough, and the passion he once displayed has gone.

No Minister has made any great claims about this Queen's Speech, which is of a rather repetitive nature. The Government are still scarred from the mauling they had last Session when they lost three major Bills and were forced to make very substantial changes in other measures, particularly the Finance Bill, which had bigger amendments forced into it than any other Finance Bill. They also had the same experience with the Aircraft and Shipbuilding Industries Bill. They were not able to bring forward industrial democracy proposals because they had set up the Bullock Committee on such a ridiculous basis. No wonder they are so cautious this Session and making threatening noises to their supporters.

I wonder whether the Government will allow a free vote on public expenditure proposals. They ducked it last year because they would have lost, and after a couple of Labour speeches that I have heard in the last hour my guess is that they might lose it again. But we should remember that this is a General Election Session, and pesumably the Chancellor of the Exchequer will fix it. The Queen's Speech is simply a diversion.

We all know what is going on. This is an attempted cover-up operation. I say "attempted" because the Government's intentions are transparent. It is as if the Government are giving a tranquiliser before the General Election. When it comes we shall get the genuine potion, and that will be a real Molotov cocktail.

All that the Queen's Speech says, in the words of the hon. Member for Preston, South (Mr. Thorne), is "how Parliament will fiddle away its time ". That is precisely it—how Parliament will fiddle away time while the Government try to rearrange appearances in a desperate bid to reduce their chances of losing the next General Election.

Most of our time this Session will be spent on devolution. That will be no help at all to unemployment in Scotland or the North-East. On 13th October unemployment in Scotland had reached 183,889, or 8.5 per cent. This is 500 up on the September figure. As the right hon. Member for the Western Isles (Mr. Stewart) pointed out, in 1974 the figure was less than half that. We are spending time on a second innings of the devolution Bills on a cut-up pitch. There have been some changes—impovements, agree, but not many. At least the Bills are now separate, and different proposals for Wales and Scotland can be looked at in an orderly way.

We recall how the Lord President insisted that two different forms of devolution for two different parts of the United Kingdom could be dealt with in one Bill. Now he knows better. But, even with the few changes, there remain the many difficulties that worried most Members of the House last Session.

The Prime Minister is quite right: I did want to have talks. I wonder why he refused to have them. We did have talks about talks, but they were not proper talks. I made that proposal nine months ago. Therefore, we could have had talks over the last eight months without loss to the Government's legislative programme. Why did the Prime Minister refuse to have talks? I will tell the House.

The Prime Minister was afraid that that kind of conference might have come to a different conclusion. It might have come to different recommendations that would have been inconvenient to the Labour Party. Whatever else he allows to happen in his Government, he will not allow anything to happen that is inconvenient to the Labour Party. That is the new doctrine of divine right, with all the arrogance that goes with it.

The direct elections Bill is again a case of the Government handling a matter to suit their own party interests. Indeed, it has been handled in such a way, I regret to say, as to justify the uncomfortable description of "perfidious Albion ". It was deliberately withheld until it was too late to get it through. We pressed and pressed for it. It was not brought forward. The reason was that if it had been brought forward it might have got through. It could have got through. But, of course, the Government never intended it to succeed.

That Bill will be reintroduced this Session. Whether "reintroduced" will be any stronger than "introduced" last Session remains to be seen, but it will be reintroduced without any of the urgency of devolution and without any of the importance of devolution attached to it. Devolution is so important that the Prime Minister talked, in opening the debate, of a fixed amount of time. Will there be a fixed amount of time for the direct elections Bill? "Never mind our obligations to our European partners or consideration for our overseas friends," the Government seem to say. If something does not suit the Labour Party, our international allies have to take second place. That seems to be the Government's foreign policy. No one abroad is deceived.

There is a nasty new twist in the reintroduced Bill. Because of the Government's deliberate delay the choice, according to the Prime Minister, is an election for the European Assembly in 1978 on the basis of the regional list or in 1979 on the basis of first past the post. I think it is very doubtful now whether there is time on any basis to prepare for the elections next year. But taking the Prime Minister's position and giving him the benefit of the doubt, the regional list system has, as he well knows, many weaknesses, and it will be criticised in this House.

The regional list system was included in the Bill only by Liberal request, together with an undertaking by the Government to recommend the regional list system. It was indeed recommended. I heard the Home Secretary make the recommendation from the Dispatch Box, and he did so with all the enthusiasm usually associated with the poisoned chalice, together with all the strength normally associated with the free vote. Why the Liberals should so damage their own cause by settling for this brand of proportional representation in this Bill is beyond my comprehension. At any rate the Prime Minister has put it into the Bill and he is counting on the House to reject it and to opt for first past the post, which it almost certainly will. He will then be able to turn towards Europe with his beaming, avuncular smile and say "Do not blame me. I did my best. It was the fault of the House of Commons." He will drag in the Opposition as well, of course.

No wonder this House is held in low esteem. At least the Lord President does not pretend to use his best endeavours, except to see that the Bill is not passed. I must say that so far he has been a good deal better at that than at getting, things through.

The central features of the Queen's Speech are proposals for constitutional reform. Reform is indeed necessary. Our institutions are threatened and need strengthening. They are being asked to bear burdens and to take a strain much greater than they were designed to take. But it is a matter for profound regret that these reforms come forward at a time when differences and divisions in this House are so wide and when the party political struggle is so bitter. Unlike former times, the basic objectives of the two sides of the House are so at variance that it seems sometimes that they are irreconcilable.

At the end of his speech the Secretary of State for Employment talked about extending the area of agreement, and I totally agree with him. The trouble is that neither his Government nor his party show any sign of doing so. The best solution would be if the Left half of the Labour Party went off to Russia, because obviously a lot of members of the National Executive Committee of the Labour Party are dissatisfied with life in Britain.

There was a story about an Arab sheikh who was heard to regret that because of his responsibility to his own country he had to return. "I should like to be just an ordinary American ", he said. "and live in the Waldorf Astoria" —just as Mr. Kitson would like to be an ordinary Russian living on caviare and champagne in the Krelim.

The Labour Party's National Executive Committee has produced a policy programme which, if implemented, would certainly turn Britain into something like Eastern Europe. The nationalisation in that programme covers almost every industry in the British economy. A total of 39 sectors of industry would come under attack, involving the jobs of millions. If even one-quarter of the programme were implemented, it is hard to see how private enterprise could survive—which is exactly the Government's intention.

The Prime Minister said that the programme was in essence the total sum of all their hopes—" their "being the Labour Party's voluntary supporters. In that atmosphere of political division, chances of harmonious, successful reforms are slender. Let us take the House of Lords, for instance. We wish to strengthen the second Chamber. The Labour Party wants to abolish it. The removal of the House of Lords would take away our only safeguard against Executive tyranny. It is not put forward as a means of improving government. The Labour Party's sole aim is to remove our last safeguard against extremism.

The House of Lords was abolished once before by the Lord President's great hero, Cromwell. The House will also know that four years later the same thing happened to the House of Commons. The Government do not seem to mind—

Mr. Heffer

Is the right hon. Gentleman aware that there is no second Chamber in New Zealand, for example? Is he aware that many democratic countries do not have second Chambers? It is not necessary to have a second Chamber to create democratic constitutions. The right hon. Gentleman is drawing a red herring.

Mr. Pym

The abolition of the second Chamber of this Parliament would remove the last bastion for the protection of the liberties of the British people. The Government are trying to force through their own schemes of reform because they believe that they will help them to cling to office. They seem to be prepared to twist any arms and pay any price to cling to power. They dress up their motives to make them look different, but sometimes they are caught off guard. For example, the Prime Minister told his hon. Friend the Member for West Lothian (Mr. Dalyell) more or less to jump into the lake. There is nothing very Baldwinesque about that. It is more reminiscent of the dog licence.

There is a new imbalance between Parliament and the Executive to which my right hon. Friend the Member for Taunton (Mr. du Cann) has frequently referred. We are experiencing a Government who are giving their own party interest an altogether new degree of priority. It seems to some people that they regard their survival in office as more important than anything else. It seems to some that they are ostensibly making decisions on behalf of the nation when they are actually making those decisions on behalf of the Labour Party.

To help them, the Government have a much enlarged public relations and propaganda machine. What is new is its scale, extent and back-up, which cannot be matched by the rest of the House put together, let alone by one party. The more that Parliament tries to control and contain the Executive, the more the Executive and the public relations machine try to wrest yet more power for themselves.

Today we are subjected to an attempt at a massive cover-up which I wish to expose. First, it involves the level of pay increases. The line taken by the Chancellor of the Exchequer was expressed on 8th September when he wrote to the President of the Association of British Chambers of Commerce. He said: if the increase in the nation's overall earnings in the current round is much above 10 per cent. we shall not get inflation down to single figures and indeed it is likely to start rising again ". The Prime Minister has said: A 10 per cent. increase in national earnings means a lower rate of inflation in 1978 than we have enjoyed for several years. More than 10 per cent. means inflation will go up once again ". The Foreign Secretary has said: Unless we can get a third round of the social contract, which keeps the rise in average earnings down to the rate of 8 or 9 per cent. … we are in danger of losing all the ground we have so painfully won ". We know from the Chief Secretary that if the rate of increase in earnings is as high as 15 per cent. we shall not get inflation down to 10 per cent. at all. All the Government's propaganda seems to be about keeping pay increases within the 10 per cent. limit. I do not know the exact figure, but it is very much higher than that.

Mr. Arthur Lewis

One hundred per cent. for certain Tories.

Mr. Pym

The line constantly comes out from the Government that they are winning on pay and that pay has to be within the Government's guidelines. But we know that settlements are infinitely higher than that.[Interruption.] I also think that the same kind of approach is being taken on inflation. The message going out from the Government is "We are winning the battle; we are beating inflation and doing better"—[Interruption]—but where are we?

Mr. Speaker

Order. It really is not fair when someone is addressing the House to have constant interruptions from a seated position.

Mr. Arthur Lewis

I apologise, Mr. Speaker, but I was so incensed when I heard about — Mr. Speaker: Order. I accept the hon. Gentleman's apology.

Mr. Pym

I think that there is a misleading message going out about inflation. The impression is being created "We are winning; it is going down", but it is still unacceptably high.

It is becoming clear that the Labour Party's election strategy rests on two planks only—amnesia and low expectation. I think that the Prime Minister thinks that if the Government can persuade the British people to forget what the Government have actualy done, and also that our present economic ills are part of the natural order of things, he can just about see a glimmer of hope for Labour's electoral chances. Every time the most technical economic indicator registers even the most marginal improvement, the Government's propaganda service trumpets the news in terms more appropriate to the Second Coming, completely ignoring the fact that the real economic situation is about as bad as it has ever been in our peace-time history.

I want to say in charity one nice thing about the Government, although I found it difficult to find one. I compliment the Chancellor of the Exchequer on his recent rare instance of modesty when he told the Labour Party Conference We shall lay the foundations for a Socialist Britain for years to come. Surely he did not do himself justice as the Chancellor who has increased the tax burden by £9 billion and the burden of public spending by £30 billion, and who has presided over an 82 per cent. increase in prices and seen the benefits percolating through the economy in a million jobs lost and an actual decline in industrial production. Having done all that, surely he can claim to have done more than just lay the foundations of a Socialist Britain. If that is the foundation, what on earth will the building be like? No wonder there is the crisis of capitalism referred to by the right hon. Member for Sunderland, North (Mr. Willey), because capitalism is being crucified. Yet we rely on it for jobs.

Because of this appalling situation, we have to change the climate. The Government cannot do it because they are hamstrung from behind—in any case, they do not want to do it, they do not know how to do it, and they could not do it. Our first job is to ensure lower taxation of capital, income and savings so as to create more capital and get more jobs. We must ensure also that just rewards are received by those with extra skills and by executives, just as we must be fair to the lower-paid workers and everyone else.

The biggest hypocrisy of all is the Government's talk about open government when they are the most closed Government we have ever had. They conceal what they are doing by pretending to do something else, rather like calling their cover-up open government. The truth is behind closed doors, and their trumpets blare out the story that they want us to believe.

There was all this talk on Monday of law and order, when the Home Secretary said that the Government were fully behind the police, as though that were something new, while the Leader of the House loses no opportunity to try to undermine the judiciary. He thinks that a majority in the House of Commons is a substitute for the judiciary, which just shows what sort of a democrat he really is.

The Secretary of State for Education and Science and Paymaster-General clocks off from her Department to join the picket line at Grunwick just to keep in favour with the Left. Turning up at Grunwick is the symbol of the Left.

The Secretary of State for Defence decides suddenly that it is his duty to set an example by going out and helping to defend the picket lines—presumably from the attacks by the police which are alleged by his hon. Friends. There he is, wide awake on the picket line but fast asleep with the Royal Air Force. I suppose that it is all part of the Government's good neighbour campaign. But if one has such a large army of public relations men, one will sometimes find oneself doing ridiculous things.

The Government Front Bench is a collection of irresponsible con men. There is none of the nobility shown by one of the Prime Minister's highly respected predecessors who, for the sake of Britain's vital interests, was prepared to round on his party and said that he would fight, fight and fight again. What we have today is just fix, fix, fix and fix again. I have news for the Prime Minister. The electorate will fix him whatever he does now, whether he has devolution or not, and whenever he goes to the country.

It took some time for the country to rumble the machinations of the right hon. Member for Huyton (Sir H. Wilson), but in the end people knew where they were with him, because they did not believe a word. I have a feeling that it may take longer with the right hon. Member for Cardiff, South-East (Mr. Callaghan), because the camouflage is rather heavier and I think that the skin is a little thicker. The right hon. Gentleman had his chance when he got to No. 10 to show that he was going to be a national leader—and, my goodness, we need one. Instead, he has confirmed that he is nothing more than a Labour leader. There is a book that the right hon. Gentleman is known to be very fond of called "Exodus ", which is a very good idea. I say to the Prime Minister "Put your cards on the table, if you dare, and go to the country. If all the news being pumped out by your Government's public relations machine is as good as you pretend it is, why wait?" There cannot be any reason to wait. Windy!

The right hon. Gentleman's delightful bluff exterior conceals an indecisive man. This is no time for indecision or weakness. The Labour Party, under his leader- ship, has got this country into too big a mess. I say to the Prime Minister, for God's sake go and let the people speak.

9.27 p.m.

The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot)

I should like to follow the remarks of the right hon. Member for Cambridgeshire (Mr. Pym) on at least one matter. First, I shall comment on a few of the earlier speeches in the debate and shall come to most of the themes—if that is the right word—that the right hon. Gentleman used at the end of his speech.

There is one matter on which I should comment at once. There has been some question whether my right hon. Friend the Prime Minister can work miracles. From the speech of the right hon. Member for Cambridgeshire and his Biblical references, my right hon. Friend has certainly worked one miracle: he has abbreviated the interval between the Book of Exodus and the Second Coming in a manner that was never achieved before. The right hon. Gentleman should accept that at least.

Before coming to some of the major matters, I turn to one or two of the earlier speeches, although several of the questions posed by individual speakers touched on very important questions. The hon. Member for Antrim, South (Mr. Molyneaux) made proposals and suggestions about the security forces and the way in which affairs should be conducted in the Province. Of course, the Government will take account of the suggestions that he put forward. I do not propose to comment on them now. I do not think that that would be the best way to proceed. Of course, we shall take very seriously the important proposition that he put forward and, at a suitable time, see that a proper reply is made.

Many of my hon. Friends have commented on different aspects of unemployment. It is natural that they should express their views very strongly. My right hon. Friend the Member for Kettering (Sir G. de Freitas) spoke about the steel industry, my right hon. Friend the Member for Sunderland, North (Mr. Willey) spoke about the very heavy unemployment in his constituency, and my hon. Friend the Member for Sowerby (Mr. Madden) commented in more general terms about the report that we have received in the past day or two from the Manpower Services Commission.

Following that report, my hon. Friend the Member for Sowerby asked for an indication of the Government's view about full employment, and whether we had set different objectives. The Queen's Speech refers to the Government's determination to achieve the speediest possible return to full employment and I do not accept any new or varied target of what that should be. The present level is appalling in every respect. We must get back not just to the 600,000 mentioned by the right hon. Member for Cambridgeshire, but well below that before we can properly say that we have full employment.

My right hon. Friend the Secretary of State for Employment said earlier—this is confirmed in the general statement of the Manpower Services Commission's report—that we and most other countries in the Western world are facing new forms of unemployment that cut much deeper and are intractable to many previously applied remedies. Of course that does not mean that we should not seek every possible way of dealing with it. The Government have said that this is their main objective, and it is set out as such in the Queen's Speech.

I shall come back to the major theme of employment, which has naturally dominated the debate not only in the House but outside, but one of the services that I can perform for the Leader of the Opposition and her party is to see whether we can reconcile some of the differences that Opposition Members have expressed in the debate.

Conservative Members have seemed to suggest that the way in which they would deal with these problems and unify and consolidate their party would be to pledge that never again would they take the sort of measures that they took between 1970 and 1974. I can see that that is an agreeable line for them to pursue. It would seem to unite at least some of those on the Opposition Front Bench. Their saying that they will never again take the measures that they took before has a natural appeal, and many people are glad to hear it.

The problem for the Leader of the Opposition is that this statement does not reconcile her with the right hon. Member for Sidcup (Mr. Heath), who takes an altogether different view of these matters. It is difficult to deal with the subject in the right hon. Gentleman's absence. I sent him a note inviting him here and I was thinking of adding "Do come. Margaret would love it so." Indeed, perhaps I did put that. Perhaps that explains his absence.

If we are to unify the Conservative Party and perform the drama properly we must realise that although it is difficult to perform "Hamlet" without the Prince of Denmark, that is not the most pathetic tragedy of all. An even more pathetic tragedy is Juliet without Romeo, and that is what we have had to face in the debate and what the right hon. Lady will have to face in future.

The right hon. Lady would be very much wiser to consider how she is to reconcile the major arguments that have been produced in this debate. The right hon. Member for Cambridgeshire was critical about our Bills on devolution. We shall have plenty of time to discuss these in the weeks ahead. I am sure that the right hon. Gentleman is now very gratified to hear that these matters will be brought to a proper decision.

I am sure the right hon. Gentleman is not too surprised to learn that we are not greatly enlivened by the proposals that he himself made on this subject. I am sure that he would regard me as prejudiced if I myself commented on his proposals. However, I quote what was said by Mr. Alan Devereaux, the Chairman of the Scottish Council of the CBI. who carefully examined the proposals put forward by the right hon. Gentleman. He said I cannot understand quite what it is that the Conservatives are proposing and we cannot comment on vague outlines. There is a lack of precision in the proposals and I cannot focus on what they are saying. That is my position on the right hon. Gentleman's proposals, but we shall soon have a chance of focusing upon them to see whether they bear any relation whatever to what the Conservative Party has previously said on these matters.

I do know what is in our own proposals, and I can assure the right hon. Gentleman that when we have the debate he will be gratified.

When he was in Blackpool recently the right hon. Gentleman tried out the speech which he delivered today. He had a great reception there. I fully acknowledge that. Summing up the situation, the chairman said: I put motion 1217 to the Conference: those in favour, and those against. Carried unanimously—no, there are two dissensions. The two dissenters, I presume, were the right hon. Member for Sidcup and the previous Prime Minister, Lord Home. They are the two members of the Conservative Party who do know something about devolution, and I am sorry that their dissensions were drowned in the general enthusiasm at Blackpool.

Let me come to the speech of the right hon. Member for Leeds, North-East (Sir K. Joseph).

Mr. Prior

Discuss unemployment.

Mr. Foot

I agree with the right hon. Gentleman that we should discuss unemployment as the main theme of our debate. I fully accept what the right hon. Member for Lowestoft (Mr. Prior) says. That is why 0I have come back to the major theme of this debate.

Mr. Madel

Before the right hon. Gentleman goes on to the main theme, will he answer the point put to him by his hon. Friend the Member for Basset-law (Mr. Ashton) about the power workers? As his hon. Friend said, we are faced with a most damaging industrial stoppage on Friday. What is the Government's view on this matter?

Mr. Foot

I fully accept that the country is faced with a most damaging industrial stoppage, and I believe that we must seek every means to bring it to an end. I believe that the Government will take account of the speech made by my hon. Friend the Member for Bassetlaw (Mr. Ashton), but I do not believe that the best way to bring this damaging stoppage to an end would be to discuss it in this debate. I do not believe that is the best way to deal with intricate, difficult industrial disputes and bring them to an end. I shall not take advice from any Conservative Member about how to bring to an end damaging industrial disputes, because we used to bring them to an end when they had been started by the Conservative Party.

Mr. Michael Brotherton (Louth)

Is the Lord President saying that the pre- sent industrial stoppage has been caused by our party? If he is saying that it was started by us, he is telling the House a complete untruth.

Mr. Foot

I never said anything of the kind. What I said was that I would not take advice from Conservative hon. Members or even right hon. Members about the way in which we should bring industrial disputes to an end, because I had succeeded in bringing to an end some industrial disputes that were started by the Conservatives. One was in February 1974.

Let me come to the speech of the right hon. Member for Leeds, North-East, who set out the general policy that is apparently the philosophical policy—if I can correctly so describe it—of the Conservative Party on the whole question of unemployment. I believe that his speech, like others that he has previously made in the country, is of extreme importance for the country as a whole, because, not solely under his influence but partly under his influence and partly under the influence of what Conservative Members may think is the course of events, the attitude of the Conservative Party on some of these matters has been greatly affected and possibly transformed. The right hon. Gentleman believes in the theory of perfect competition—

Sir Keith Joseph (Leeds, North-East)


Mr. Foot

We shall have to work out how imperfect is the right hon. Gentleman's theory. Certainly, in his speech yesterday he sought to describe how every subsidy, every intervention, by the Government altering the normal operations of the market economy was bound to be counter-productive. The right hon. Gentleman almost argued, with a refinement that can hardly ever have been shown even by Friedman and company, that every job that might be created by the expenditure of money in one field by the Government would exclude somebody from a job in another field. He wanted to know what was the exact comparison in those two fields. [Interruption.] I shall come to the right hon. Member for Lowestoft in a moment. Let us deal with the two right hon. Gentlemen one at a time. I know that there is a difference between them, and I am trying to sort it out.

The right hon. Member for Leeds, North-East spent most of his time yesterday explaining that all expenditure of Government money was no use for dealing with these matters, because it distorted the economy and the proper operation of market economics, whereas the right hon. Member for Lowestoft in his speech today did not dissent in one particular from every penny being spent by my right hon. Friend the Secretary of State for Employment on measures to assist in dealing with unemployment.

Sir K. Joseph rose

Mr. Foot

Perhaps the right hon. Member for Leeds, North-East will now tell us what he thinks about the money that has been spent on the temporary employment subsidy—many hundreds of thousands of people have been kept in jobs by that ; what he thinks of the money spent on training services—this Government have spent more on training than any previous Government have ; and what he thinks of the money spent on regional policies. Perhaps he will tell us whether he accepts that all these policies are required and that he will not abandon them. I do not know whether the right hon. Gentleman wants me to give way after all, because he did not have the good fortune that I had of listening to his right hon. Friend support the Government on all these matters.

Sir K. Joseph

I did listen to my right hon. Friend, and I heard him quoting the OECD report and saying that for every 10 jobs there are, so-called, created by Government expenditure through such things as temporary employment subsidy, six jobs are destroyed, my right hon. Friend said, somewhere else in the economy, and I say that perhaps it may be more than six. Does the Lord President really ask us to believe that the Government can tax and borrow in order to rescue some jobs without destroying other jobs elsewhere? Does he think that it is six, as the OECD says, or more as I say? Does he really deny that any jobs are destroyed?

Mr. Foot

I certainly say to the right hon. Gentleman—[HON. MEMBERS: "Answer."] I shall answer the right hon. Gentleman precisely if he will wait a minute. In direct answer to his question, I certainly agree that it is possible to tax and to borrow to save jobs. So does the right hon. Member for Lowestoft, because that is what he said this afternoon.

Mr. Priorindicated dissent.

Mr. Foot

Oh, yes. If there is to be a dispute in this matter—[HON. MEMBERS: "Answer.") I am answering the right hon. Gentleman's question directly. That question was whether I believed that it was possible to tax and to borrow and therefore possible to save and protect jobs. My answer is an unequivocal "Yes ". But we did not get an unequivocal "Yes" from the right hon. Gentleman. The temporary employment subsidy—"Yes "to that one. The money spent on training—" Yes" to that.

I see that the right lion. Gentleman does not agree. Let us allow both right hon. Gentlemen to sort it out. Perhaps they should have a little sub-committee to sort it out between them. We know that they had a bit of a fracas before Blackpool, but we thought that they had made it up. I am sorry that they should have fallen out again.

Mr. Prior

Why is it that Labour Governments have created 1½ million un-employed and a Conservative Government left 600,000 unemployed?

Mr. Foot

I shall come to the further answer to the right hon. Member for Leeds, North-East. There is a further reason why the right hon. Gentleman's logic in these matters, or his philosophy in these matters—whichever he likes to call it, and which I shall assume for the sake of this argument, applies to the whole of the Conservative Party—is defective. That is that the right hon. Gentleman is arguing that the unemployment in this country, and the scale of that unemployment in particular, is due to Government intervention in the economy. That is his argument. But how can it then be explained that in this same Western world there are several countries in which there is much less intervention and much more unemployment? Hon. Gentlemen shake their heads. The United States is one case, and Canada is another.

How can the right hon. Gentleman explain it the other way round? How can he explain why there are some countries in the Western world—I am not talking about Communist countries—where there has been more intervention than in this country, particularly in labour market measures, and much less unemployment, such as in Sweden, for example?

These are instances that confound the right hon. Gentleman's theory. What he ought to do is to lake his lessons again from the right hon. Member for Down. South (Mr. Powell), because when the right hon. Member for Down, South expounds this full classical doctrine he does it as if it is an engine of history. When the right hon. Gentleman does it, it is a kind of Christmas toy with which he has become so fascinated that he cannot apply his mind to the real problems of the nation.

Therefore, I say to the right hon. Gentleman and his friends quite seriously that when, in this debate and in the national debate, because unemployment figures must and should feature preeminently in that debate—we are not afraid of the argument—he and his friends, because he has now converted them, are called upon to say how much more unemployment they think the full application of these classical policies would imply.

The right hon. Member for Sidcup came up against that fact in 1972 and 1973. We know that the right hon. Member for Leeds, North-East is rather different these days. He beats his breast so fiercely and violently that we think that he has done himself permanent injury, but he has not yet confronted the right hon. Member for Sidcup. That is the point. Not one word of apology for his measures has come from the right hon. Member for Sidcup. There has not been a word of penitence from him, or a single spark of his ambition extinguished, and I honour the right hon. Member for Sidcup for that. There he sits,in absentia, bloody but unbowed.

The right hon. Gentleman is, in fact, still the real leader of the Conservative Party. The Leader of the Opposition, for all her courage and personal appeal, follows in the tracks of the right hon. Member for Sidcup. She even had to go to Rome the other day to show what a good Common Marketeer she has become so late in the day—did she not? Now, she says that she will not talk about these matters with the right hon. Member for Sidcup, but the right hon. Gentleman holds to his position, because he remembers what happened and because he believes that, if by any change of fortune, the Conservatives came back to power, the argument would recur. It would not be the theories of the right lion. Member for Leeds, North-East that would withstand the storm. They would be swept aside.

That is why the right hon. Member for Sidcup stands his ground, and we should honour him for that. I am sorry that the right hon. Member is not here to tell us so, but he does it even more forcefully without being here. I hope that the Leader of the Opposition will tell us how she would reconcile some of these policies and the ones that she would present. I hear the right hon. Lady say that the right hon. Member for Sidcup is not even here. That is the kindest language that I have heard her use about him for the past two or three years. She is making a big mistake if she thinks that he is not here.

I am sorry to have strayed into these matters, because I set out with the best hope of trying to unite the Conservative Party so that on these matters they could present a united front to the House and the country. Instead of that, all these old quarrels have broken out, precisely for the reason that the Leader of the Opposition and her right hon. and hon. Friends would not answer, in this debate, the very questions that they were putting to us. We answer the questions.

Mr. Peter Temple-Morris (Leominster)

The Minister has referred to the Leader of the Opposition and has incarnated my right hon. Friend the Member for Sidcup (Mr. Heath) several times during the debate. However, it is not the right hon. Lady who is always referring to that right hon. Gentleman but the present Prime Minister, who talks about resisting the National Union of Mineworkers. The same problems are here now as were here before, and what my right hon. Member for Sidcup did—backed by the present Leader of the Opposition—is now Government policy. Will the Minister admit it?

Mr. Foot

We believe that in order to deal with unemployment that is more severe than anything we have known since the 'thirties—and that is, in some parts of the country, more severe than has ever been known—a whole series of measures are required, many of which the Conservative Party is incapable of applying. Action must be taken on an international scale, and that is what the Prime Minister sought to do in the meetings that he had with President Carter and other leaders. We believe that particular action must be taken to deal with youth unemployment. That is why the Government have put forward the measures that were described by the Secretary of State for Employment this afternoon. They are better measures for dealing with that type of problem than any that have been produced in any other country in Europe. Even the right hon. and spluttering Member for Lowestoft did not utter a word of criticism of them in the debate. He may be seeking to attack them now, but he did not do so before.

We believe also that there will have to be a great extension of the operations of the National Enterprise Board and of Government action. That is one reason why, yesterday, my right hon. Friend the Secretary of State for Industry described many of the extended measures that were to be taken by the NEB, especially in the North-East and on Merseyside.

We believe, also, that, as speedily as possible, we must have a proper reflation of the economy in order to do it. To achieve that, we have to ensure that the reflation can take place in a manner that does not recreate the kind of inflation that was destroying our economy. That, indeed, is the aim of most of the other countries in Western Europe besides.

It is because we are determined to carry out those policies and because it can be seen that we are able to carry out those policies with greater support from the country than anything forthcoming to the right hon. Member for Finchley (Mrs. Thatcher)—(HON. MEMBERS: "What policies? ") I have already said what some of them are, and I have already described how the Government are determined to defeat inflation and how we

are being a good deal more successful than ever the Conservative Party was. I have also described the widespread support that we have received in the country for doing it, and how we are determined to carry it through. It is precisely because the Opposition are so angry and irritated about what has occurred, and because they have seen snatched away the prizes that were stretching before them, that they have shown such antagonism in this debate.

I say to the right hon. Member for Finchley that she should go away and prepare for many more Blackpools. She will have many more victories at Blackpool. So concerned was she about the unemployment problem when she last went to Blackpool that she did not mention it once in her speech. She had nothing new to say on the subject. She had nothing to declare.

We propose to carry through the policies that we have described to ensure that we defeat inflation and carry through measures for the industrial renovation of the country. We believe that we will carry them through with greater and greater support from the country. It is precisely because that support has been forthcoming in such measure over recent weeks that the right hon. Member for Finchley and her right hon. and hon. Friends have been so discomfited.

When the Leader of the Opposition next needs some assistance in these matters, I shall be only too happy to offer my services. Of course, I cannot offer her as quick a unity as that which we have, but I shall do my best to assist her in every possible way.

We look forward to a lively Session. We shall carry through all the measures foreshadowed in the Queen's Speech. We shall meet again in 12 months. I hope that the right hon. Lady will have been able to reconcile her party's differences by then. In the meantime, I welcome her to the 12 months ahead.

Question put,That the amendment be made:—

The House divided: Ayes 272, Noes 299.

Division No. 2] AYES [10.0 p.m.
Adley, Robert Arnold, Tom Baker, Kenneth
Aitken, Jonathan Atkins, Rt Hon H. (Spethorne) Banks, Robert
Alison, Michael Awdry. Daniel Bell, Ronald
Amery, Rt. Hon Julian Bain, Mrs. Margaret Bennett, Sir Frederic (Torbay)
Bennett, Dr Reginald (Fareham) Grylls, Michael Morrison, Hon Peter (Chester)
Benyon, W. Hall, Sir John Mudd, David
Berry, Hon Anthony Hall-Davis, A. G. F. Neave, Alrey
Biggs-Davison, John Hamilton, Michael (Salisbury) Neubert, Michael
Blaker, Peter Hampson, Dr Keith Newton, Tony
Body, Richard Hannam, John Nott, John
Boscawen. Hon Robert Harvie Anderson, Rt Hon Miss Onslow, Cranley
Bottomley, Peter Haselhurst, Alan Oppenheim, Mrs Sally
Bowden, A. (Brighton, Kemptown) Hastings, Stephen Page, John (Harrow West)
Boyson, Dr Rhodes (Brent) Havers, Rt Hon Sir Michael Page, Rt Hon R. Graham (Crosby)
Braine, Sir Bernard Hawkins, Paul Page, Richard (Workington)
Brittan, Leon Hayhoe, Barney Parkinson, Cecil
Brocklebank-Fowler, C. Heath, Rt Hon Edward Pattie, Geoffrey
Brooke, Peter Henderson, Douglas Percival, Ian
Brotherton, Michael Heseltine, Michael Peyton, Rt Hon John
Brown, Sir Edward (Bath) Hicks, Robert Pink, R. Bonner
Bryan, Sir Paul Higgins, Terrence L. Prentice, Rt Hon Reg
Buchanan-Smith, Alick Hodgson, Robin Price, David (Eastleigh)
Buck, Antony Holland, Philip Prior, Rt Hon James
Budgen, Nick Hordern, Peter Pym, Rt Hon Francis
Bulmer, Esmond Howe, Rt Hon Sir Geoffrey Raison, Timothy
Burden, F. A. Howell, David (Guildford) Rathbone, Tim
Butler, Adam (Bosworth) Hunt, David (Wirral) Rees, Peter (Dover & Deal)
Carlisle, Mark Hunt, John (Ravensbourne) Rees-Davies, W. R.
Chalker, Mrs Lynda Hurd, Douglas Reid, George
Channon, Paul Hutchison, Michael Clark Renton, Rt Hon Sir D. (Hunts)
Churchill, W. S. Irving, Charles (Cheltenham) Renton, Tim (Mid-Sussex)
Clark, Alan (Plymouth, Sutton) James, David Rhodes James, R.
Clark, William (Croydon S) Jenkin, Rt Hon P. (Wanst'dW'df'd) Ridley, Hon Nicholas
Clarke, Kenneth (Rushcliffe) Jessel, Toby Ridsdale, Julian
Cockroft, John Johnson Smith, G. (E Grinstead) Rifkind, Malcolm
Cooke, Robert (Bristol W) Jones, Arthur (Daventry) Roberts, Wyn (Conway)
Cope, John Jopling, Michael Rossi, Hugh (Hornsey)
Cormack, Patrick Costain, A. P. Joseph, Rt Hon. Sir Keith Rost, Peter (SE Derbyshire)
Costain, A.P. Kaberry, Sir Donald Royle, Sir Anthony
Crawford, Douglas Kershaw, Anthony Sainsbury, Tim
Critchley, Julian Kilfedder, James St. John-Stevas, Norman
Crouch, David Kimball, Marcus Scott, Nicholas
Crowder, F. P. King, Evelyn (South Dorset) Shelton, William (Streatham)
Davies, Rt Hon J. (Knutstord) King, Tom (Bridgwater) Shepherd, Colin
Dean, Paul (N Somerset) Kitson, Sir Timothy Shersby, Michael
Dodsworth, Geoffrey Knight, Mrs Jill Silvester, Fred
Douglas-Hamilton, Lord James Knox, David Sims, Roger
Drayson, Burnaby Lamont, Norman Sinclair, Sir George
du Cann, Rt Hon Edward Langford-Holt, Sir John Skeet, T. H. H.
Durant, Tony Latham, Michael (Melton) Smith. Dudley (Warwick)
Dykes, Hugh Lawrence, Ivan Smith, Timothy John (Ashfield)
Eden, Rt Hon Sir John Lawson, Nigel Speed, Keith
Edwards, Nicholas (Pembroke) Lester, Jim (Beeston) Spence, John
Elliott, Sir William Lewis, Kenneth (Rutland) Spicer, Michael (S Worcester)
Emery Peter Lloyd, tan Sproat, Iain
Evans,Gwynfor (Carmarthen) Loveridge, John Stainton, Keith
Ewing Mrs Winifred (Moray) Luce, Richard Stainton, Keith
Eyre, Reginald McAdden, Sir Stephen Stanbrook, Ivor
Fairbairn, Nicholas MacCormick, Iain Stanley, John
Fairgrieve, Russell McCrindle, Robert Steen, Anthony (Wavertree)
Farr John Macfarlane, Neil Stewart, Rt Hon Donald
Fell, Anthony MacGregor, John Stewart, Ian (Hitchin)
Finsberg, Geoffrey MacKay, Andrew (Stechford) Stokes, John
Fisher, Sir Nigel McNair-Wilson, M. (Newbury) Stradling Thomas, J.
Fletcher, Alex (Edinburgh N) McNair-Wilson, P. (New Forest) Tapsell, Peter
Fookes, Miss Janet Madel, David Taylor, R. (Croydon NW)
Forman, Nigel Marshall, Michael (Arundel) Taylor, Teddy (Cathcart)
Fowler, Norman (Sutton C'f'd) Marten, Nell Tebbit, Norman
Fox, Marcus Mates, Michael Temple-Morris, Peter
Fraser, Rt Hon H. (Stafford & St) Mather, Carol Thatcher, Rt Hon Margaret
Fry, Peter Maude, Angus Thomas, Rt Hon P. (Hendon S)
Galbraith, Hon T. G. D. Maudling, Rt Hon Reginald Thompson, George
Gardiner, George (Reigate) Mawby, Ray Townsend, Cyril D.
Gardner, Edward (S Fylde) Maxwell-Hyslop, Robin Trotter, Neville
Gilmour, Rt Hon Ian (Chesham) Mayhew, Patrick van Straubenzee, W. R.
Gilmour, Sir John (East Fife) Meyer, Sir Anthony Vaughan, Dr Gerald
Glyn, Dr Alan Miller, Hal (Bromsgrove) Viggers, Peter
Godber, Rt Hon Joseph Mills, Peter Wakeham, John
Goodhart, Philip Miscampbell, Norman Walder, David (Clitheroe)
Goodhew, Victor Mitchell, David (Basingstoke) Walker, Rt Hon P. (Worcester)
Goodlad, Alastair Moate, Roger Wall, Patrick
Gorst, John Monro, Hector Walters, Dennis
Gow, Ian (Eastbourne) Montgomery, Fergus Warren, Kenneth
Gower, Sir Raymond (Barry) Moore, John (Croydon C) Watt, Hamish
Grant, Anthony (Harrow C} More, Jasper (Ludlow) Weatherill, Bernard
Gray, Hamish Morgan, Geraint Wells, John
Grieve, Percy Morgan-Giles, Rear-Admiral Welsh, Andrew
Griffiths, Eldon Morris, Michael (Northampton S) Whitelaw, Rt Hon William
Grist, Ian Morrison, Charles (Devizes) Wiggin, Jerry
Wigley, Dafydd Wood, Rt Hon Richard TELLERS FOR THE AYES:
Wilson, Gordon (Dundee E) Young, Sir G. (Ealing, Acton) Mr. Spencer le Marchant and
Winterton, Nicholas Younger, Hon George Mr Michael Roberts.
Abse, Leo Faulds, Andrew Luard, Evan
Allaun, Frank Fernyhough, Rt Hon E. Lyon, Alexander (York)
Anderson, Donald Fitch, Alan (Wigan) Mabon, Rt Hon Dr J. Dickson
Archer, Rt Hon Peter Fitt, Gerard (Belfast W) McCartney, Hugh
Armstrong, Ernest Flannery, Martin McDonald, Dr Oonagh
Ashley, Jack Fletcher, Ted (Darlington) McElhone, Frank
Ashton, Joe Foot, Rt Hon Michael MacFarquhar, Roderick
Atkins, Ronald (Preston N) Ford, Ben McGuire, Michael (Ince)
Atkinson, Norman Forrester, John MacKenzie, Rt Hon Gregor
Bagier, Gordon A. T. Fowler, Gerald (The Wrekin) Mackintosh, John P.
Barnett, Guy (Greenwich) Fraser, John (Lambeth, N'w'd) Maclennan, Robert
Barnett, Rt Hon Joel (Heywood) Freeson, Rt Hon Reginald McMillan, Tom (Glasgow C)
Bates, Alf Freud, Clement McNamara, Kevin
Bean, R. E. Garrett, John (Norwich S) Madden, Max
Beith, A. J. Garrett, W. E. (Wallsend) Magee, Bryan
Benn, Rt Hon Anthony Wedgwood George, Bruce Mahon, Simon
Bennett, Andrew (Stockport N) Gilbert, Dr John Malialieu, J. P. W.
Bidwell, Sydney Ginsburg, David Marks, Kenneth
Bishop, Rt Hon Edward Golding, John Marshall, Dr Edmund (Goole)
Blenkinsop, Arthur Gould, Bryan Marshall, Jim (Leicester S)
Boardman. H. Gourlay, Harry Mason, Rt Hon Roy
Booth, Rt Hon Albert Graham, Ted Maynard, Miss Joan
Boothroyd, Miss Betty Grant, John (Isington C) Meacher, Michael
Bottomley, Rt Hon Arthur Grimond, Rt Hon J Mellish, Rt Hon Robert
Boyden, James (Bish Auck) Grocott, Bruce Mendelson, John
Bradley, Tom Hamilton, James (Bothwell) Mikardo, Ian
Bray, Dr Jeremy Hardy, Peter Millan, Rt Hon Bruce
Brown, Hugh D. (Provan) Harper, Joseph Miller, Dr M. S. (E Kilbride)
Brown, Robert C. (Newcastle W) Harrison, Rt Hon Walter Mitchell, Austin
Buchan, Norman Hart, Rt Hon Judith Molloy, William
Buchanan, Richard Hattersley, Rt Hon Roy Moonman, Eric
Butler, Mrs Joyce (Wood Green) Hatton, Frank Morris, Alfred (Wythenshawe)
Callaghan, Rt Hon J. (Cardiff SE) Hayman, Mrs Helene Morris, Charles R. (Openshaw)
Callaghan, Jim (Middleton & P) Healey, Rt Hon Denis Morris, Rt Hon J. (Aberavon)
Campbell, Ian Heffer, Eric S. Moyle, Roland
Canavan, Dennis Hooson, Emlyn Mulley, Rt Hon Frederick
Cant, R. B. Horam, John Murray, Rt Hon Ronald King
Carmichael, Neil Howell, Rt Hon Denis (B'ham, Sm H) Newens, Stanley
Carter, Ray Howells, Geraint (Cardigan) Noble, Mike
Carter-Jones, Lewis Hoyle, Doug (Nelson) Oakes, Gordon
Cartwright, John Huckfield, Les Ogden, Eric
Castle, Rt Hon Barbara Hughes, Rt Hon C. (Anglesey) O'Halloran, Michael
Clemitson, Ivor Hughes, Robert (Aberdeen N) Orbach, Maurice
Cocks, Rt Hon Michael (Bristol S) Hughes, Roy (Newport) Orme, Rt Hon Stanley
Cohen, Stanley Hunter, Adam Ovenden, John
Coleman, Donald Irvine, Rt Hon Sir A. (Edge Hill) Owen, Rt Hon D, David
Colquhoun, Ms Maureen Irving, Rt Hon S. (Dartford) Padley Walter
Cook, Robin F. (Edin C) Jackson, Colin (Brighouse) Palmer, Arthur
Corbett, Robin Jackson. Miss Margaret (Lincoln) Pardoe, John
Cowans, Harry Janner, Greville Park, George
Cox, Thomas (Tooting) Jay, Rt Hon Douglas Parker, John
Craigen, Jim (Maryhill) Jeger, Mrs Lena Parry, Robert
Crawshaw, Richard Jenkins, Hugh (Putney) Pavitt, Laurie
Cronin, John John, Brynmor Pendry, Tom
Crowther, Stan (Rotherham) Johnson, James (Hull West) Penhaligon, David
Cryer, Bob Johnson, Walter (Derby S) Perry, Ernest
Cunningham, G. (Islington S) Johnston, Russell (Inverness) Phipps, Dr Colin
Cunningham, Dr J. (Whiteh) Jones, Alec (Rhondda) Price, William (Rugby)
Davidson, Arthur Jones, Barry (East Flint) Radice, Giles
Davies, Bryan (Enfield N) Jones, Dan (Burnley) Rees, Rt Hon Merlyn (Leeds S)
Davies, Denzil (Llanelli) Judd, Frank Richardson, Miss Jo
Davis, Clinton (Hackney C) Kaufman. Gerald Roberts, Albert (Normanton)
Deakins, Eric Kelley, Richard Roberts, Gwilym (Cannock)
Dean, Joseph (Leeds West) Kerr, Russell Robinson, Geoffrey
Dell, Rt Hon Edmund Kilroy-Silk, Robert Roderick, Caerwyn
Dempsey, James Kinnock, Neil Rodgers, George (Chorley)
Doig, Peter Lambie. David Rodgers, Rt Hon William (Stockton)
Dormand, J. D. Lamborn, Harry Rooker, J. W.
Douglas-Mann, Bruce Lamond, James Roper, John
Dulfy, A. E. P. Latham, Arthur (Faddington) Rose, Paul B.
Dunn, James A. Leadbifter, Ted Ross, Stephen (Isle of Wight)
Dunnett, Jack Lee, John Ross, Rt Hon W. (Kilmarnock)
Eadie, Alex Lestor, Miss Joan (Eton & Slough) Rowlands, Ted
Edge, Geoff Lever, Rt Hon Harold Ryman, John
Ellis, John (Brigg & Scun) Lewis, Arthur (Newham N) Sandelson, Neville
English, Michael Lewis, Ron (Carlisle) Sedgemore, Brian
Ennals, Rt Hon David Lipton, Marcus Selby, Harry
Evans, Fred (Caerphilly) Litterick, Tom Sever, J.
Evans, loan (Aberdare) Lomas, Kenneth Shaw, Arnold (Ilford South)
Ewing, Harry (Stirling) Loyden, Eddie Sheldon, Rt Hon Robert
Shore, Rt Hon Peter Thomas, Mike (Newcastle E) Wellbeloved, James
Silkin, Rt Hon John (Deptford) Thomas, Ron (Bristol NW) White, James (Pollok)
Silkin, Rt Hon S. C. (Dulwich) Thorne, Stan (Preston South) Whitehead, Phillip
Sillars, James Thorpe, Rt Hon Jeremy (N Devon) Whitlock, William
Silverman, Julius Tierney, Sydney Willey, Rt Hon Frederick
Skinner, Dennis Tinn, James Williams, Rt Hon Alan (Swansea W)
Small, William Tomlinson, John Williams, Alan Lee (Hornch'ch)
Smith, John (N Lanarkshire) Tomney, Frank Williams, Rt Hon Shirley (Hertford)
Spearing, Nigel Torney, Tom Williams, Sir Thomas (Warrington)
Spriggs, Leslie Tuck, Raphael Wilson, Alexander (Hamilton)
Stallard, A. W. Urwin, T. W. Wilson, Rt Hon Sir Harold (Huyton)
Steel, Rt Hon David Varley, Rt Hon Eric G. Wilson, William (Coventry SE)
Stewart, Rt Hon M. (Fulham) Wainwright, Edwin (Dearne V) Wise, Mrs Audrey
Stoddart, David Wainwright, Richard (Colne V) Woodall, Alec
Stott, Roger Walker, Harold (Doncaster) Woof, Robert
Strang, Gavin Walker, Terry (Kingswood) Wrigglesworth, Ian
Strauss, Rt Hon G. R. Ward, Michael Young, David (Bolton E)
Summerskill, Hon Or Shirley Watkins, David
Swain, Thomas Watkinson, John TELLERS FOR THE NOES:
Taylor, Mrs Ann (Bolton W) Weetch, Ken Mr. Peter Snape and
Thomas, Jeffrey (Abertillery) Weitzman, David Mr Frank R. White.

Question accordingly negatived.

Main Question put and agreed to.


That an humble Address be presented to Her Majesty, as follows:

Most Gracious Sovereign,

We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.

To he presented by Privy Councillors or Members of Her Majesty's Household.