§ 6 a.m.
§ Mr. Mike Noble (Rossendale)
I am pleased to have the opportunity to initiate this debate, though I am not sure that the time is particularly appropriate. I am grateful to my hon. Friend the Minister for having stayed up all night to reply.
The subject of the debate was deliberately chosen to cover a wide area, but I wish to concentrate on the North-West as an example of the regional problem. The cause of the regional problems in all parts of the country has been well documented in the House. It arises principally from the operation of free market forces for more than 200 years, particularly in my part of the country, which is generally recognised as the cradle of the Industrial Revolution.
One question that will have to be faced in the relatively near future is whether this country has regional problems or, in the context of Europe, is becoming a regional problem itself. The same economic forces that created the regional problems in this country are operating on a much wider scale from the centre of the EEC based on the Rhine basin.
We know the symptoms of the regional difficulties that we face. Old industries are declining. I shall give some examples in a statistical form. We have a worn-out infrastructure. My hon. Friends and I are in touch, for example, with the North-West water authority, which has indicated the enormous problems it faces below the ground in dealing with sewerage and water. We have insufficient 533 investment in new technology. We have had a changing structure of firms in the North-West. More and more firms have become part of national or even multinational companies with headquarters away from the North-West. Establishments in the North-West have become, in many cases, outlying provinces of the main part of the firm and they feel the main squeeze at a time of recession when we have closures or short-time working.
We also have an over-centralised form of government under which too many decisions concerning the North-West are taken in London when they could be taken within a democratic structure in the North-West or in the other regions concerned.
Those are the sorts of problem that we must discuss, together with the means of assisting the regions to overcome them. The difficulties facing the regions will become clearer if we consider one or two facts affecting major industries. The regional imbalance is largely caused by the fact that we have too high a proportion of employment in "sensitive" industries—I think of textiles and footwear in my constituency. In 1971, a total of 20.4 per cent. of the employed population worked in the textile, clothing and leather industries compared with a national proportion of 13.4 per cent. In 1976 18.8 per cent. of the employed population worked in those three industries compared with a national figure of 12.4 per cent.
We are aware of the way in which those industries have suffered as a result of the world recession and because of low-cost imports. In that respect the concentration of that type of employment in some areas of the North-West makes the employment position in many towns, particularly in my constituency, more vulnerable. Between 1971 and 1976 there was a 21 per cent. job loss in the textile industry and a 12 per cent. job loss in the clothing and footwear industries in the North-West. During that time 30 per cent. of the jobs in the coal and petroleum industries disappeared. About 30 per cent. of the jobs in metal manufacturing disappeared. The mechanical engineering industry experienced a job loss of 18 per cent.
534 What would the loss of employment have been if the Government had not introduced measures to preserve employment? What would have been the job loss in the North-West textile and footwear industries if the Government had not introduced temporary employment subsidy? That subsidy alone has saved more than 100,000 jobs in the North-West. The figures that I have just given would be more serious without that type of support.
There can be little wonder that there has been a population decline in the North-West. It is part of a long-term trend. There is a high net migration rate.
One can examine the regional deprivation syndrome from a range of different points. There has been an improvement in the unemployment rate. In January 1975 unemployment in the North-West was one-third above the national average. By January this year it had dropped to 21 per cent. above the national average.
Earnings in the North-West are generally below the national average. The indices of material wealth in the NorthWest—possession of a telephone, refrigerator, car and so on—are well below the national average. The number of children in the region who leave school at the age of 16 is way above the national average. That is the scale of the problem that must be tackled.
The Government's approach to these problems is well documented. I place on record my appreciation of the financial assistance which the Government have provided. The sections 7 and 8 schemes under the Industry Act have been helpful to industry in the North-West. From an answer which I received from the Minister last week I learnt of the amount of money involved in regional development grants and other forms of assistance to the textile industry. Assistance has been given to the footwear and other industries. Help has been given to inner city areas. The number of people in training in the North-West is above the national average. The Government also help by the temporary employment subsidy and by investing in young people.
But the attitude of the Department of Industry on some issues is disappointing. For example, I am disturbed that the intermediate areas find it difficult to obtain financial assistance from the 535 European Investment Bank. I have asked Questions about the role of the Department of Industry, in its capacity of agent for the European Investment Bank, when requests for finance are made for projects in intermediate areas as opposed to special development and development areas.
Concern is also expressed about the regional role of the National Enterprise Board. One of the disappointing features of the regional board was that the representation of regional trade union representatives was somewhat limited. I recall visiting the Department of Industry and arguing that we should have on the board a broader representation from the Labour movement.
Many of us express disappointment that planning agreements have not been forthcoming and that we do not have the structure to ensure that the regional plans of many national and multinational firms, especially in the North-West, are co-ordinated with Government assistance through the mechanism of planning agreements.
I express those disappointments, but it must be accepted that over the past four years we have had a clear and specific commitment from the Government to the assisted areas. The amount of Government finance available to support investment and to support jobs has been increased by an enormous proportion compared with what went before during the previous Conservative Administration.
What is the Conservative attitude to regional policy? I know that some of my constituents are concerned that there is no clear indication of the nature of that policy. What has that to do with the debate? I must make it clear that only last Friday I attended a meeting of the North-East Lancashire Development Association that represents six or seven local authorities in North-East Lancashire, an intermediate area. Questions were raised about the effect on the confidence of manufacturers bearing in mind the uncertainty about the regional policy in future. I was able to say that the Labour Party would continue its policy and that as we would be continuing in government for a long time the lack of confidence was misplaced. Nevertheless, there is some doubt about 536 the attitude of the Conservative Party towards regional aid.
The right hon. Member for Leeds, North-East (Sir K. Joseph) said:we believe that these subsidies and grants "—those are the subsidies and grants that are directed to industry—do more harm than good. They will not make us more competitive… We believe that subsidies and grants and, indeed, the industrial strategy distract management and workers from the key task of putting their house in order by co-operation between themselves.The right hon. Gentleman added:these grants and subsidies may rescue some jobs but only at the cost of other jobs."— [Official Report, 4th July 1978; Vol. 952, c. 255–56.]That is probably as clear a statement as we have been able to secure from the Opposition on their attitude towards regional policy.
In February the right hon. Lady the Leader of the Opposition, when talking about changes in the regions, made a remarkable observation. She said:Jobs lost in declining industries can be replaced by new jobs elsewhere.I wish that the right hon. Lady would visit my constituency to explain to the textile workers and the footwear operatives exactly where they would find new jobs in a valley where there is little room for industrial development and where 60 per cent. of employment is based on those two industries.
We have had contradictory statements from leading Opposition speakers. The right hon. Member for Worcester (Mr. Walker) said:The free market condemns the weal and therefore becomes a powerful source for social disorder.He added:It is a distressing spectacle to watch a small, but vocal and apparently influential section of the Tory Party bow down to worship the free market gods which brought so much squalor, so many slums and so much social divisiveness and injustice.Finally, the right hon. Member for Chipping Barnet (Mr. Maudling) made an interesting comment in his memoirs. He wrote:We had Selsdon Man and it took some time to get over that. We do not yet know the full measure of Selsdon Woman.I find that a most interesting quotation. 537 The fact is that the simple arithmetic of the Opposition does not add up. If they intend to cut £5,000 million off taxation, something must come out of regional policy. It is time they made that clear.
There are some important questions that the Government must answer. The Minister should give a clear commitment that the boundaries of the assisted areas in the North-West will not be redrawn and there will be no downgrading of status for any area. I would also like a commitment that new technology will be centred in assisted areas and will not be sited in parts of the country which are already blessed with modern technology and other advantages.
I draw my hon. Friend's attention to Early-Day Motion 114, signed by 61 hon. Members from a wide variety of regions and on an all-party basis. It calls for the INMOS project to be sited in an assisted area. It is significant that the hon. Member for Gosport (Mr. Viggers) has tabled an amendment to the motion in which he calls for it to be sited according to commercial interests alone. I would argue that the siting of industry based on market forces is what has created such deprivation and difficulty in assisted areas.
In his election campaign—and I followed it most assiduously; I was practically in his footsteps—the hon. Member for Workington (Mr. Page) went round his constituency arguing for free market economics, a reduction in public expenditure and less Government interference. Within a month of coming to the House, in a debate on the Thames Board Mills, he asked for £10 million worth of Government investment to preserve and improve job opportunities in Workington. He has every right to do so, we applaud him for fighting for his constituency, but it was a direct contradiction of the economic philosophy that he pursued in his election campaign.
Allowing market forces to determine the location of industry cannot continue, especially in the siting of new technologies. That is why we say that the INMOS project must go to an assisted area. My hon. Friend the Member for Newton (Mr. Evans) has done a tremendous job for the North-West in drawing attention to the need for INMOS and the associated jobs to be sited in that region. I place on record the appreciation of the 538 North-West group of Labour Members of the work that he has done in pressing our case.
The case for siting INMOS in our area is straightforward. We have an available work force with the necessary skills. We have workers in the North-West who are already employed in the computer and electronics industries, and we have the relevant number of graduates and the technical ability provided through our universities. The North-West is second to none in communications networks. It is riddled with motorways, and there are airports. From February we shall have a high-speed train service to London. Manchester is the commercial centre of the North-West. In many respects it is still true that what was said in Manchester today might be said in London tomorrow.
I understand that one of the arguments used in suggesting that Bristol should he the site of the INMOS facility is the attractive living conditions in the Costwolds. I am aware that there is a feeling in this country that all those of us who live north of Watford still rush around wearing sheepskins and Viking horns and live in mud huts. I am sure that my hon. Friend the Member for Wigan (Mr. Fitch) would argue that even the image of Wigan is based on a nineteenth century perception and not a modern perception. Certainly those of us from the Pennine areas, and the hon. Member for Workington, would argue that we can provide living conditions in the North or North-West which are second to none, and that the quality of life available will match anything that can be provided in the West Country or in the South-East. We have, indeed, a wide choice of locations for INMOS, and a wide selection of housing, and so on
The point that disturbs me most about the suggestion that the project should go to Bristol rather than to the North-West, is the idea that the Bristol-Bath university complex can provide the necessary technology. My hon. Friend the Member for Newton has written to the Prime Minister on this point, and I can do no better than quote his letter. He says that:in one particularly vital area I have done further research; that is in relation to the university personnel who will be required to provide the high technology back-up to the INMOS R & D facility. Evidence I have obtained suggests that the university personnel required will fall under three headings: (a) Solid state electronics, (b) Computer science, (c) 539 Digital electronics, with category (a) being the most important. The respective position of the Bristol-Bath university institutions and Salford-Manchester institutions is that in category (a) Bristol-Bath have no academics at all, whereas Salford-Manchester have 18. In the other two disciplines, Bristol-Bath have 14 academics, Salford-Manchester have 76. In view of this I asked my advisers to give me an indication of the time and money it would take to train the academic experts at Bristol-Bath that INMOS would require. As they have no indication of what INMOS would require at this stage, the criteria they have used is the time and money that would be required to bring Bristol-Bath up to the present standard of Salford-Manchester, i.e., 94 academics against 14. They first point out that with every academic there also has to be a trained technician and an overhead cost, building, admin, etc., and their estimate is £20,000 per academic per annum for five years: at today's prices, £100,000 per academic. 80 times that amount means £8 million. In addition, Salford-Manchester has over £2 million of scientific equipment installed. Bristol-Bath have none. So we are talking about a sum in excess of £10 million in university training, equipment and buildings, but more significantly, over a five-year period, to bring Bristol-Bath up to where Salford-Manchester already is.That is an irrefutable case. The logic in that argument cannot be denied. The argument that this facility should be placed in the South-West is not based on the cold realities of what is needed in the regions and which region can best provide the facility. It is based on something that we in the assisted areas—not only in the North-West but the other assisted areas which have been clamouring for this project—simply cannot understand. We have only to ask what would be the effect on the general morale of a region which secured this highly prestigious project. I can tell my hon. Friend that if it came to the North-West it would have a very substantial effect indeed, apart from the jobs impact of between 2,000 and 3,000 people working in direct production.
But let me go further than that. My constituency is not generally regarded as being in the forefront of the technological revolution. We do not think of cloth and shoes as being high technology. But this morning I received a letter from Mr. Starkey, the managing director of Envair (UK) Limited, a firm which is situated in my constituency. He said:We note with interest the Government's intention to back the electronics industry; our particular immediate interest is in the N.E.B. project INMOS.540Our understanding at the moment is that a site for the project has not yet been selected, although the North-West of England, and more particularly Lancashire, is being seriously considered.In addition to the vast resources that this area can offer in electronic technology, we would like to add that companies such as ourselves are in a position to offer facilities in providing the correct environment for electronic production. In fact, Envair have just completed the largest electronic clean room complex in the country at British Aerospace in Lostock, near Bolton.That is simply an example of the spin-off that would be achieved by bringing this technology to an assisted area. The facilities for manufacturing may be sited in one or two places, but the thought of having an injection of this scale in the North-West would bring substantial benefits indeed. If the Department of Industry has been led by the nose by anyone about the siting of this project in the South-West or anywhere else, it should think again before it is too late, because hon. Members representing all the assisted areas will descend on the Department like hordes from hell and make a clamour the like of which it has not heard before if this facility goes to the Bristol area. No case can be made for its being sited at Bristol which cannot be made, and improved upon, for its being sited in our area. I leave that thought with my hon. Friend.
I turn to another problem at the other end of the manufacturing scale—the problem of small firms and particularly the provision of tailor-made advance factories to meet their needs. In recent years, a great deal has been said about small firms. The area which I represent has reason to be grateful to the Department for the number of advance factories which have been provided. In this respect, I am thinking about North-East Lancashire. But we have a problem of success, because there are literally no spare factory space or nursery units for small firms. I am talking about units of up to 10,000 sq. ft. which could be divided up or which would be suitable for an intermediate firm. But nothing is available in North-East Lancashire at present, and nothing is likely to be available in the next two years.
My hon. Friend may tell me that there is the Staplex place, or that two factories recently became empty. But they have only just appeared on the market, and 541 there is a question about their suitability. Certainly we have no available new factories in the area.
The local authorities in North-East Lancashire are pretty independent in their attitudes. As they say in that part of the world, they are quite prepared to put their brass where their mouths are. In fact, in 1936 Burnley built the Prestige factory with no legal authority for it whatever. It is fortunate that it did, because it now forms the basis of the most important industrial estate in North-East Lancashire.
The local authorities are asking—and I ask my hon. Friend to take this up with the Secretary of State for the Environment—for a fresh look to be taken at the way in which finance is allocated to local government for this purpose. If the local authorities in the North-East Lancashire development area spend their money, extra finance has to come from one of three sources: from the rates, but £150,000 for an advance factory in my constituency would put a couple of pence on the rates, from borrowing, or from capital receipts; they can sell something. They can borrow—and that is the obvious answer to the situation—only with the permission of the Secretary of State for the Environment in order to build factories for industrial purposes. If they borrow, it must be either in the key sector of expenditure—housing, derelict sites and highways are included in that—or in the locally determined sector. Here the Lancashire county is granted an allocation, which is then split between the local authorities by agreement. It works out at approximately £120,000 each per year. Obviously that is not enough to meet the cost of building a new factory.
The local authorities have been pressing for this expenditure to be switched to the key sector. The Secretary of State refuses on the grounds that it will increase the public sector borrowing requirement, and that the local authorities will have to accept this switch at the expense of doing something else. That does not recognise the initiative of local authorities in my area which want to be able to provide jobs. The future of some sensitive industries is uncertain, and new investment must be attracted. If the advance factory 542 programme cannot meet the demand, local authorities should be able to take the initiative. Their only alternative is the moneylender, at inflationary rates of interest and tight conditions, burdening the ratepayers.
I congratulate the Department of the Environment on its tackling of regional problems over the past four years. On a grand scale we need the INMOS project, which will have more than an economic effect. Less grandly, we need to provide more jobs through advance factories. If the Department cannot do the job, we should be allowed to do it ourselves.
§ 6.32 a.m.
§ Mr. Richard Page (Workington)
I congratulate the hon. Member for Rossendale (Mr. Noble) on an able speech. We may differ in our approach to the regions, but our aim is the same—to get people working and give them a better standard of living.
This debate brings to mind the remarks of the hon. Member for Chester-le-Street (Mr. Radice) two Fridays ago and of the right hon. Member for Sunderland, North (Mr. Willey) a week before that. A number of bodies have produced reports about the Northern region, but there is still no real prospect of growth and job opportunities. We are in danger of frantically worrying whether each region is getting its fair share, which comfortably ignores the prime reason for our failure—the failure of the main stream of our economy. Our industrial companies face a crippling bank rate and a national insurance stamp whose cost has gone up by leaps and bounds, on top of an accelerating wages bill. Nothing damages employment more. Within a month of my becoming a Member of the House, the Prime Minister announced that he would oversee the industrial strategy of which we hear so much and see so little. Practically every index shows the United Kingdom slipping further and further behind other industrial nations. In industrial terms we are struggling to reach our 1973 levels. The latest OECD figures for main economic indicators for trade and industry show that other countries have increased their industrial production three and four times more than we have. That type of loss means that we cannot do as much as we would like for our regions. 543 We in the North, like those in other regions, forget the poor state of the remainder of the country and we tend to regard our regional problems in isolation, not in a national context. The main chance of improvement must lie in the creation of a favourable national climate. It can only happen in an atmosphere in which a day's work receives a day's pay, in which initiative, hard work and innovation are encouraged and rewarded. Only then will we climb back to the prosperity we deserve.
Those who are on low wages—and in the North-West and the North the wages are low—feel resentment and disappointment at others who are unemployed enjoying a better life than they are. We must therefore emphasise the need to create an environment in which our industries can compete profitably, where people find it worth while to do a day's work, to accept training and to learn new skills. Our taxation package, with its direct tax cuts, must be the means to create that climate.
We also recognise that in the foreseeable future we cannot just cut off regional development grants, aids and policies. We shall maintain aid in certain highly deprived areas. We shall have a solid regional policy with the continuation of the Scottish and Welsh Development Agencies. The concern is that the Government, with their grants and schemes, are eroding the special benefit of having a black spot declared a development area. If we are not careful, we shall need an extra special development agency to improve these areas. If that happens we shall have acquired just another set of rules and an additional layer of bureaucracy to administer them.
The hon. Member for Rossendale referred to the TES. He will remember the disappointment at the way in which the REP was slashed with only a few days' notice for firms. We recognise the job that TES is doing in the current economic climate, and we shall continue it until the mainstream of the economy can provide better standards of living, when it can be gradually phased out.
There is a danger, in the North in particular, in looking for an overall solution without realising that the region divides into two. The part I am most interested 544 in is the industrial complex on the West coast of Cumbria. It is far smaller than that on the East, and has the feeling of being the poor relation, with all the headquarters and so much more industry being established in Newcastle. However, on the West coast of Cumbria we can see the beginning of success of regional policy. One of the tremendous strengths of this region is that it has moved from the very narrow operating base of coal and steel towards a spread of new and, in some cases, much smaller industries.
I should like to move on to the whole question of smaller businesses and how much Britain needs them, and to introduce comparisons with, say, Germany, whose smaller businesses are supposed to be over 40 per cent. greater than small businesses here, and even with Japan, a country of which one would say that the people are more attuned to working in large units, but on investigation one finds that the Japanese have a very active, thriving and growing smaller business sector. But to do that would be moving beyond the remit of this debate.
Looking at the history of the area—it is important to see just where and how an area has grown up—it can be seen that there has been a considerable mental change, almost a psychological change, towards its industrial outlook. Now, because of very positive approaches towards accepting new and changing industries, it has started, even in these depressed times, to achieve some appreciable growth. It has had the common sense to accept and welcome the incorporation of new technologies and new techniques into the area and not to try to cling to making wagon wheels for ever.
At one time, the West coast of Cumbria had the highest unemployment rate in the country, and one town in my constituency reached the staggering rate of 80 per cent. In comparison today, the national average figure is 5.8 per cent or 5.9 per cent and Workington's rate is now 7.4 per cent. There are obviously localised areas in the constituency where the rate is higher, but still it is contrasting very favourably with the rest of the Northern region.
Looking at this region and at the success of regional development policies, we find that, for example, Lloyd's List a couple of weeks ago devoted two or three pages purely and simply to this part of 545 the country. In it we find all the new industries mentioned. Obviously, there is Windscale, there are chemical works, and there is even the improvement to the Thames Board Mills, to which reference was made earlier. I am glad to inform the hon. Member for Rossendale that the new plant is going ahead and construction is well under way. The £10 million or so that was given to help it to get going will be paid back to the Government when it makes a profit. It was not given free, gratis and for nothing.
I partially support what the hon. Gentleman said to the Minister regarding INMOS. I shall not push for it to be located in the North-West or in the North, but I feel that it should be located in a part of the country which can provide the academic skills and the background to supply the new employment in the area that the Government choose.
New technologies should come into areas where the traditional earnings base is changing. Workington has come away from coal and it has adapted on steel. This is the only solution for our other black spots, that new industries give a chance for people to transfer from one industry to another.
In conclusion, we as a party will be maintaining a regional development policy in the highly deprived areas, and we shall be doing that until the main stream of the economy picks up and the whole of the nation goes forward economically. We do not regard all these policies as a crutch. We must regard them as a springboard to bring an area back into economic line with the rest of the country, just as is now happening already in Workington.
Regarding the statements by my hon. Friends on regional development policies, I must say, with respect to the hon. Gentleman, that he has taken a series of fragments of what has been said by Opposition Members, and out of those jigsaw pieces he has constructed his own picture of what he wants to see.
§ Mr. Page
I was about to sit down. The hon. Gentleman should wait to see our manifesto. He will then realise that we have a regional development policy. The Labour Party produced a manifesto over the weekend. I could throw the wish to nationalise every part of industry at the hon. Gentleman. We have had more Socialism in the last four years than ever before. Our industrial productivity has been as flat as a pancake. In fact it has gone down. We have 1½ million unemployed. Resentment against the Labour Party is very great in regions which at one time thought that it would look after them. Labour Members will find out how great that resentment is when the election comes.
§ 6.46 a.m.
§ Mr. Michael McGuire (Ince)
I want to take up one or two of the points made by the hon. Member for Workington (Mr. Page). One concerns greater incentives creating the right climate for work and reduced taxation presumably increasing investment. I think that everyone would agree that we have under-invested. One of the tasks of the Labour Government has been to correct that imbalance.
The right hon. Member for Sidcup (Mr. Heath)—a former leader of the Conservative Party—was one of the most eloquent advocates of "Free the people and they will respond ". I do not want to use vulgar expressions, but, paraphrasing him, he said" The blighters simply will not invest when you let profits rip and take off all the constraints. Therefore, the Government have to do it ". Some of us may complain that the Government do not do enough in certain special areas, but the fact is that the right hon. Gentleman's policy does not work either.
I agree that, whatever policy we are discussing, if our unit costs do not match, or more than match, those of our competitors, our decline will continue. I have urged my right hon. Friends, and I urge my hon. Friend the Under-Secretary of State, to get the message across that the nation as a whole must tackle this problem. The trade unions must also take it on board. Jobs are being lost at ever-increasing speed, but increased investment 547 often means that fewer people are required in an industry. We must not see job opportunities being irrevocably lost. We should be provided with further opportunities for wise investment. However, if we do not get our costs down, we shall continue to decline.
I shall not repeat our international trade figures. The legacy of an empire did not do us very much good. We did not have to sell as hard as our competitors. We produced the goods and our relatives in our captive markets took them from us, while our competitors in the other industrial nations honed their skills in markets where they had to sell. They had to get their products there at the right price and overcome the imbalance in our favour. We must get our industrial costs down—and pretty sharply.
This debate is most welcome, and we are indebted to my hon. Friend the Member for Rossendale (Mr. Noble) for initiating it. We do not often enough discuss what must be the cornerstone of the Government's industrial policy, which is regional policy. This island's history has left us with certain bad features and certain good features from our industrial past.
There are over 70 Members from the North-West. We are talking about a region with a population of more than 7 million—not of 1½ million or 2 million, but a population that probably nearly equals that of Wales and Scotland combined. The area that my hon. Friend and I have the privilege to help to represent has a proud industrial record. It was the birthplace of the Industrial Revolution.
We have been left certain bad features of the Industrial Revolution. We have seen the decline of industries which sustained this country in bygone days, such as the textile industry. There is an old saying about England's bread being earned by Lancashire's thread. Such sayings have become part of our industrial folklore.
Although it was not previously as sophisticated as it is now, regional policy has a long history. Governments realised a long time ago that they had to do something in certain areas or those areas would decline even more rapidly. There- 548 fore, we had the use of Government resources to help prop up industries. Special benefits were given to encourage people to go into such areas. On the whole, the position would have been much worse in many areas if we had not done that. We should have had a catastrophe.
No Government would allow that. When it suits them, the Opposition say that they will deal with the problem better than we do. They say that they will be more generous. When we have debates with a bigger attendance than we have now, they vie with one another to spend more than we do. They accuse us of being miserly. But there is the contradiction that they say that they will slash several thousand millions of pounds from public spending and put the money in people's pockets. They say that they will do all kinds of wonderful things. We have never been able to fathom them out, but no doubt all these matters will emerge when we fight the General Election. I suspect that the Opposition have been fighting it for the past 12 months, and they have to think of some new things to say.
I think that our last proper full debate on regional policy was on 18th July 1977. when my right hon. Friend the Minister of State, the Member for Swansea, West (Mr. Williams), took part and we brought matters up to date. I initiated our last debate of this kind on the Consolidated Fund Bill in March this year. The present Government gave us the innovation of regional affairs debates in Committee upstairs. They are a poor substitute for the real debates, which should take place in the Chamber. Those debates have turned out to be something of a bear garden. Probably we are at fault because we do not select a single topic for debate. We should do this. Any hon. Member can raise any subject under the sun. The debates are not usually as fruitful as they should be.
We need at least an annual debate in the House on the working of the Government's regional policy. The hon. Member for Workington has proved how successful regional policy can be. It has resuscitated an area typical of industrial towns in the North-West. His area was heavily dependent on coal and steel, now in sharp decline. In a way, the hon. Member gave us a back-handed credit.
§ Mr. Richard Page
A depressed area should be given aid to bring it back to the normal level of operation of the rest of the country. It should not be given a perpetual crutch. It should receive surgery, if necessary. There should be hospital treatment, rather than condemning such an area to the geriatric ward. This is exactly what has happened in Workington. It is now coming up to levels elsewhere. It is not a question of giving praise grudgingly. The results have been achieved in Workington because both parties, when in Government, have given regional aid.
§ Mr. McGuire
The hon. Gentleman clarifies what I said. I remind him, as I have to remind myself sometimes when I ask for a better deal for parts of my constituency, that even the greatest form of aid is usually only an initial help. Special development areas receive a rate of grant at a certain level for plant and machinery. There is a slightly higher rate for the number of jobs brought in. The figures decline for the development areas and there is substantially less given to assisted areas. Apart from temporary employment subsidy, given in all these areas, money is not pumped in continually to existing industries. An area is not constantly given money for settled industries. Grants are given to attract new industries. Without such grants, there would not be the diversity of industry which has grown up in Workington. That area is lifting itself up—although its unemployment rate at 7.5 per cent. is still too high. Nevertheless, it is lower than rates in some areas that I represent. I rejoice that that has happened. My point is that we do not discuss these matters often enough to see whether the policy is working.
My hon. Friend the Member for Rossendale raised the question of INMOS. The Prime Minister has put in the Library a copy of a recent speech of his on the impact of what he had been advised that this new industry will bring. My hon. Friend the Member for Rossendale made the case, and I support it—I said the same earlier today on the motion for the Adjournment—that INMOS should go to the North-West. It should go to the North-West because the North-West has been, so to speak, short-changed in so many aspects of Government grants and aid in one form or another. 550 When we used to debate our affairs either in the Chamber or in the Regional Affairs Committee—we have had a couple in the recent past—hon. Members would mention one topic, that of health, and so prove that we have been short-changed. All of us would give the statistics for health, showing how the North-West was being disadvantaged compared with any other region whether one was talking about infant mortality, general mortality or anything else. We were told that the Government understood that we had to make the case but we were over-egging the pudding and the figures were nothing like that.
But what do we find now? The hon. Gentleman may well have been a recipient. He should be if he has been shortchanged. There is now a new allocation to regional health authorities. Not only is the North-West given the appropriate allocation for regional health authorities, but it is also given a special allocation to make up for the now acknowledged substantial underpayments in bygone years. In other words, we were right. I think that this has deprived my constituents, as it happens—I said this earlier today and I do not want to raise it any more—of a hospital which was planned a long time ago for the new town of Skelmersdale. The truth is that we have been shortchanged.
The number of Government jobs opens up another avenue for examination. We are talking about a region with over 7 million people. The number of Government office jobs and other jobs paid for by the Government shows again that we have been unfairly treated. The North-West has fared badly compared with other regions. If we get all that the Government are supposed to transfer to us under the Hardman report—if we get all that is promised plus the one or two things which are still the subject of debate—we shall have about 140 jobs per 100,000 of population. That is about the lowest figure one can bring the statistics down to to make any sense.
How will that compare with Wales, for example? I do not have the figures for Scotland in my mind, but Scotland does less well than Wales, with about 400-plus jobs per 100,000 of population compared to our 140 in the North-West. 551 Wales has so far about 640 jobs per 10,000 of population.
The North-West has been in this bad position with industries which have declined substantially. The cotton industry has gone right down. It employed 1 million people at one time. My hon. Friend knows these figures better than I do. What are we at now—about 70,000 in total?
§ Mr. McGuire
Yes, 60,000 or 70,000. So we have come down substantially. The mining industry has declined, too. As an ex-miner I know the figures. We used to have about 100,000 miners when the Lancashire coalfield was in its days of pomp, and now we are down to about 12,000.
We used to have a steel industry. We hear talk about the birthplace of the Industrial Revolution. We have lost our only steel-making plant. I may add that it was closed without a lot of fuss and bother, and perhaps we should have made a bit more fuss and bother. Members representing North-West constituencies are often accused of not making enough fuss and bother compared with Members from other areas. I wish that we had a nationalist party in the North-West. We might do a bit better if we had. In that industrial heartland, still one of our great industrial areas, we have no steel-making capacity. It has been taken from us under the closure programme of the British Steel Corporation.
We have fared badly in all these respects. The Merseyside-Manchester conurbation has the worst statistics for almost anything one cares to name—infant mortality, general mortality and illness, especially respiratory illness such as bronchitis. We have the lowest number of children qualifying to go on to higher education and staying on in higher education. It is the same with housing, judged by the yardstick to describe bad housing. So the North-West has done pretty badly.
The North-West has a good case for more help, but it has been steadily ignored, for one main reason: we have paid the political Danegeld here. We have 552 put it into certain parts of the country—Wales and Scotland in particular and, to some extent, the North-East because it is so close to Scotland and had to be given a sweetener to soften the blow and make the medicine that the Welsh and the Scots got not seem quite so beneficial to them. The North-West has suffered because of the political Danegeld.
I come back to the question of the INMOS issue. There is no doubt that the North-West has all the infrastructure for sustaining this industry that one can find anywhere in the country. The universities are there. There is the technical expertise, which many of the workers take in with the mother's milk. They have a long tradition in this kind of mechanical expertise. They would soon acquire whatever skills were needed for this new industry. I can think of no other region that could put in a better claim for INMOS.
My hon. Friend the Member for Rossendale mentioned our motorway system. Those who live near the motorways are not so proud, but the system is probably better in our area than anywhere else in the country. Our communications by land, sea and air cannot be bettered anywhere in the country, and I doubt whether they can be equalled. We have the technical and intellectual expertise which can sustain and nourish this industry.
I believe that there is an overwhelming case for this new industry to go to the North-West, but I am sufficient of a national strategist to say that the siting of the project will be a real test of the Government's commitment to a genuine regional policy. We know the process of leaking. Something is put out, and no one takes any notice. It is almost like subliminal advertising in a way. It comes out again, and then again, and gradually it becomes like a series of body punches —one absorbs them and each weakens one a bit. Then one says "Well, we were told that it was going to go there ", even though there has been no Government announcement. No decision has been announced, but that is vastly different from saying that no decision has yet been made.
My hon. Friend said that this project is to go to the Bristol area. He said that it had been suggested that the beauties of the Cotswolds would be a determining factor. I agree with him entirely about 553 the joys and beauties of Lancashire. We can offer places like the Lake District, one of the gems and joys of England, and we have plenty of other places where it is very comfortable to live.
I said that Lancashire was the birthplace of the Industrial Revolution, but it would be wrong to give the impression that it is an area of slag heaps and dereliction generally. There are some beautiful spots in Lancashire within easy reach of areas in which this project could be sited—the Merseyside area, which could make a substantial claim for it, the Manchester area or the Lancaster area. In whichever part of the North-West this project was sited, there would be lovely sites well within the reach of those who want to live in pleasant surroundings. I do not condemn people who want to live in the pleasantest of places—that is what I should want to do—but the Cotswolds cannot have a claim which overrides the claims of Lancashire or the North-West.
If the project is sited in the Bristol area, it will make a mockery of the Government's pretence about regional policy. It will be an indication that once again we are to pay the political Danegeld, because the Government cannot put the project in Wales. Every Welsh Member of Parliament, whatever his political complexion, will make a case for this project to go to Wales. I think that the Government will say "We have done very well by Wales ", and short of putting it there they will put it in the nearest possible place to Wales. I could be wrong, and I hope that when my hon. Friend replies to the debate he will tell us that no decision has as yet been made. We know that none has been announced.
I pay tribute, as did my hon. Friend the Member for Rossendale, to the work of my hon. Friend the Member for Newton (Mr. Evans), who has drawn the attention of the Government, and our attention, too, to the needs and claims of the North-West. I hope that when the Minister replies to the debate he will tell me that my fears are totally unfounded, that the strongest representations that the Government have received so far have come from the North-West, and that he fully takes on board the fact that to site this project outside any area that has assisted status of one form or another— 554 if the intended area has any status it must be of the lowest form—would be a contradiction of any Government regional policy.
I must take this opportunity to tackle my hon. Friend. I said that we had had two debates on regional policy. One was initiated by my right hon. Friend the Member for Swansea, West on 18th July 1977. The other was initiated by myself on 20th March of this year, and that was largely about why we needed to look afresh at what I call the tactics within the regional strategy and to consider the claims of my constituency—that is, that part which is outside the Skelmersdale new town area. Skelmersdale new town enjoys the highest form of grant aid, and the only plea that I constantly make—apart from my plea for the new hospital there and the need to complete the grand design for Skelmersdale, because it would be nonsense not to give us the planned new hospital—is that, although it enjoys the highest form of grant, the area has suffered many body blows, particularly 18 months ago. We had the closure of the Thorn colour television tube factory, followed by the closure of the Courtaulds factory with the permanent loss of 2,300 jobs. Those empty factories are a constant and grim reminder of the lost jobs.
Regional aid is a once-and-for-all operation which attracts new industries which would not otherwise move to an area. We have had some body blows in "Skem ", but we have also had some quiet successes and we would have more if the Government would help a little more. Companies now settled in Skelmersdale are usually part of a larger, national empire, and when their boards consider expansion, "Skem" has to compete on almost level terms with other areas. It would help if companies qualified for extra grants if they expanded in Skelmersdale. I have suggested that to Ministers but, although they have not poured cold water on it, the idea has not been favourably received.
Our success stories could be multiplied if firms that expanded their existing factories in "Skem" qualified for additional aid, even though they may have exhausted their original grants. I hope that the Minister will be able to give us that assurance.
555 The rest of my constituency is in the Wigan travel-to-work area, and my hon. Friends the Members for Wigan (Mr. Fitch), Newton and Westhoughton (Mr. Stott) and I have constantly pressed the Government in deputations, debates and questions to reconsider the claims of Wigan to be granted at least development area status. Its unemployment rate is 8.5 per cent.—one of the highest in any intermediate area. A total of 144 areas have a lower rate yet enjoy a higher form of grant aid. That cannot be fair.
Wigan has a continuing high rate of unemployment and cannot offer the same grant aid as other areas. It is trying to solve its problems with one hand tied behind its back. It is the Government's duty to look at the adjustments that must be necessary in such circumstances.
§ 7.20 a.m.
§ The Under-Secretary of State for Industry (Mr. Les Huckfield)
The House is indebted to my hon. Friend the Member for Rossendale (Mr. Noble) for giving us the opportunity to have another discussion on regional policy and industrial location—although it is not the most sparkling time of day.
My hon. Friend has obviously done much research. He used a succession of facts and figures which showed that. Both he and my hon. Friend the Member for Ince (Mr. McGuire) presented good cases. I hesitate to say that they presented moderate arguments. They have gone to much trouble and presented a comprehensive case. I shall reply as fully as possible. I also wish to reply to the confused performance of the hon. Member for Workington (Mr. Page). After 15 minutes I was unable to decide whether he wanted a regional policy.
Any regional policy operated by a Labour Government must give the highest priority to the areas with the highest and most persistent unemployment, particularly to those with weak industrial structures. That is why this Government will continue to pursue a policy which discriminates in favour of such areas. I am sure that my hon. Friends recognise the problems of areas such as Merseyside, which has an 11.5 per cent. rate of unemployment. A total of 86,685 people are without jobs in the area. The unemployment rate there is 556 above the average of 7.2 per cent. for the North-West as a whole—although that is high enough. I am sure that my hon. Friends realise the basic priorities to which the Government must adhere.
My hon. Friend the Member for Ince talked about paying the Danegeld. I understand what he means in political terms. The unemployment rate in the Northern region is 8.6 per cent. In Wales the unemployment rate is 8.3 per cent. and in Scotland it is 7.8 per cent. Those are higher percentages than the percentage in his area. There might be resentment that Scotland, Wales and other regions have been given greater priority, but those areas have the highest unemployment figures. In the Rossendale travel-to-work area unemployment is 4.8 per cent. That is one of the lowest rates in the North-West region.
§ Mr. Noble
That figure, although correct, is disguised because the Government have provided temporary employment subsidies on a massive scale to maintain the textile and footwear industries in the area. Without Government action, the rate of unemployment would be between 15 per cent. and 20 per cent.
§ Mr. Huckfield
I am grateful to my hon. Friend for the tribute that he has paid to the Government. It is important to keep people in secure jobs.
My hon. Friend the Member for Ince referred to development area status for Wigan. The unemployment rate in that area is 8.5 per cent. and the Government accept that Wigan has a serious problem.
Our basic regional instrument must be industrial development certificates. I assure my hon. Friends that we administer the policy with flexibility and sympathy. We try to identify mobile industrial projects which we think can be steered to assisted areas. We have stressed continually that we do not want firms to be inhibited from applying. We want them to apply, and basically that is what is happening. One of the difficulties is that in an economic trough we do not have that many mobile industrial projects coming forward. Although we administer the policy as sympathetically as possible, the basic national difficulty is having too few industrial projects coming forward that may be located in 557 the assisted areas that my hon. Friends represent.
I can reassure my hon. Friend the Member for Rossendale that we fully understand the need for continuity and for certainty in the administration of our policy. It would not be conducive to industrialists investing and it would not give them confidence and a feeling of security if they felt that the policy might be subjected to continuous changes. We fully understand and take on board the need to create a climate of confidence and certainty. That is why the Government do not propose to have continuous changes in regional boundaries.
We have a lack of mobile projects, but a further difficulty is that we are going through one of the worst depressions since the 1930s. It is a depression that compounds some serious structural unemployment problems. Although a regional policy could perhaps cope with location of industry in a normal economic period, when that series of problems is overlaid by a series of structural problems we have to take additional measures.
The assisted areas already cover about 40 per cent. of the working population and 65 per cent. of the land area. The more extensive we make the coverage, the less effective will regional policy become. That tends to water down the effects on existing categories and existing priorities.
§ Mr. Michael McGuire
I consider that argument to be a fallacy. As I understand it, the purpose of regional policy is to confer assistance on areas that would be disadvantaged if they did not have it as they would not be able to attract industry because they are on the extremities of various areas and not in the favoured areas. If Wigan, for example, received the higher form of grant aid, that would mean that it would be better able to compete with its neighbours. Its needs are as great—they may be greater —as some of the areas that already enjoy the higher grant aid. It is not as if the Government have a certain amount of money and that they plaster it around. The money may be exhausted, but an area will still enjoy the advantage of regional aid because new industries will have been attracted. The thinning of the jam argument is a fallacy.
§ Mr. Huckfield
I understand the pleadings of my hon. Friend. He makes his case well. I hope that he will take cognisance of the fact that within intermediate status areas there are areas with higher unemployment problems and percentages than the area that he represents. Rhyl, for example, has a current unemployment rate of 14.1 per cent. The rate at Bridlington is 10.3 per cent. It is 9.9 per cent. at Mexborough. I hope that my hon. Friend will recognise that there are intermediate areas with a prior claim in unemployment terms to that of the area represented by my hon. Friend.
§ Mr. Huckfield
I reinforce what I said to my hon. Friend the Member for Rossendale. Frequent changes in boundaries and status do not make for continuity and do not make for the confidence that we have to give to investors.
§ Mr. Huckfield
Until the general review of regional policy and a general review of the boundaries take place—we do not have any plans for that—we do not intend to make frequent and regular changes. That is because we do not feel that changes are conducive to the continuity of investment.
I assure my hon. Friends that the Secretary of State, in the designation of assisted areas, is required by the criteria to have regard toall the circumstances, actual and expected, including the state of employment and unemployment. population changes, migration and the objectives of regional policies.My right hon. Friend is bound to take those points into his calculations. But we must act in a situation in which unemployment is the most useful and most convenient indicator of the problems of areas such as those we are discussing.
Within the general assisted area of the North-West—and it all has assisted area status of one sort or another— there are the partnership areas. Of the eight partnership areas, four are in assisted areas—Glasgow, Liverpool, Salford and Newcastle-upon-Tyne. Of the 42 designated districts, 33 are in assisted areas. We have calculated that policy so that assisted areas should maintain their priority.
559 I reaffirm as strongly as possible that we want to give priority to assisted areas, especially to the special development areas such as Merseyside and Skelmersdale. The best guarantee of continuity of employment for my hon. Friend's constituents is continuity and consistency of the regional policy.
§ Mr. Richard Page
Does the Minister really feel that with 1,500,000 unemployed in this country he is being progressive enough? We have an unemployment rate of 7.4 per cent. in Workington. Under the Conservatives, it was down to 5 per cent.
§ Mr. Huckfield
The hon. Member can put the case to me and I shall listen to him sympathetically. I suggest that he also puts it to the "gang of four" on his own Front Bench, because they are telling a completely different story.
As I thought, reference has been made to INMOS. I realise that there is an early-day motion on the subject. INMOS has engaged consultants to make a detailed study of possible locations in the various areas. The precise location is for the company and the NEB, and it would be inappropriate for me to identify one possible location or another before the study has been made. Obviously the NEB has guidelines under which it must operate, and those guidelines require it to take account of the needs of the assisted areas. I assure my hon. Friends that this subject has been fully discussed between the NEB and the Department of Industry. Obviously a statement will need to be made soon, but as yet no decision has been taken and consideration is still being given.
I know that there have been all kinds of press reports—there usually are in situations of this kind—but the great majority of the jobs involved in the total project will be in production units. About 4,000 new jobs are involved there. Another 50 or so jobs in the technology centre will be created by the end of next year. But I emphasise that decisions have not yet been taken in these matters. Obviously the NEB must consider them seriously.
Of the other agencies that can help the North-West, there has been a great deal of disappointment with the perform- 560 ance of the National Enterprise Board in the North-West. I hope that the North-West, like other regions, will benefit from the total investments that the NEB has made—in Rolls-Royce, British Leyland and Ferranti, which is one of the Board's success stories.
I turn to regional selective financial assistance. Some 1,084 projects in the North-West have attracted offers of assistance of nearly £113 million towards projects, the total costs of which have been more than £881 million. That is in the North-West region alone. It is estimated that there will be the creation of more than 57,000 new jobs and the safeguarding of a further 54,000 jobs.
On Merseyside, nearly £58 million has been offered towards projects costing £354 million, which is expected to create 21,200 new jobs and to safeguard another 24,600.
In Greater Manchester, 397 offers totalling £32 million have been made towards projects costing £256 million, with 17,600 new jobs in prospect and 18,000 jobs safeguarded.
Those are significant and impressive figures, and I am grateful to my hon. Friends for the tributes they have paid regarding the effect of these figures in their regions.
My hon. Friend the Member for Rossendale referred to advance factories. I can tell him—he probably knows the figures already—that 140,000 square metres of advance factory space have been authorised in the North-West since 1974, of which 90,000 square metres have been on Merseyside and 11,000 square metres in North-East Lancashire. Advance factories totalling 74,000 square metres have already been built, and another 51,000 square metres of factory space are at present under construction.
I am unable, unfortunately, to give my hon. Friend exact figures about how much of that would be precisely in his area. I want to have a look at the point he made about giving local authorities more flexibility on this aspect. I will discuss this with my right hon. Friend, because my hon. Friend made a very coherent case. I hope that my hon. Friend will recognise that district councils have been given more flexibility in the administration of local industrial development certificate ponicy, because, up to a total of 561 60,000 sq. ft., local authorities—now district councils—have been given a new amount of flexibility which I hope they will use wisely. I will certainly take note of the point that my hon. Friend has made.
My hon. Friend also referred to grants from the European Regional Development Fund.
§ Mr. Huckfield
Perhaps I may just complete the total picture. My hon. Friend referred to funds from the EEC, and I can tell him that European regional development funds have contributed £35 million towards projects to develop industry and infrastructure in the region.
My hon. Friend referred to the European Investment Bank, and I know that he has put down some Questions which I shall be answering very shortly, but I can tell him—if I may anticipate my remarks slightly—that we are prepared exceptionally to consider employment-creating projects in intermediate areas and projects which safeguard employment throughout the assisted areas. One loan under the EIB agency loan scheme has already been approved for a project in an intermediate area, and others also in intermediate areas are under consideration. That is an advance warning of what my hon. Friend will get in my more fulsome answers when they arrive, and I hope he will recognise that we are treating his point with the utmost sympathy.
My hon. Friend the Member for Ince mentioned the topic of dispersal. He knows that the region will receive nearly 5,400 posts under the Hardman report. I hope that both my hon. Friends will take note that so far, under the administration of our industrial development certificate policy, nearly 770 industrial development certificates have been issued in the North-West for projects covering 35.7 million sq. ft. This is expected to give rise to 29,000 new jobs.
The total of assistance in industrial development certificates, regional selective financial assistance, and the other measures to which I have just referred, such as the European Regional Development Fund, and the section 8 measures, to 562 which I want to refer, constitute a rather significant package which, as I have said before, has kept unemployment in the North-West, though higher than in the South-East and the West Midlands, certainly lower than it is in the North, in Wales and in Scotland.
I want to make a brief reference to small firms, which are now my responsibility within the Department of Industry. Further measures are under consideration as part of a study being conducted by my right hon. Friend the Chancellor of the Duchy of Lancaster. The work of the Wilson committee and the Roll committee is also relevant here.
We operate small firms information services nationally. In fact, I was in Manchester only yesterday doing part of my small firms information service work. The small firms employment subsidy has already led to some 7,500 workers being taken on in small firms in the North-West region, so again I should like to say that the North-West is benefiting from our small firms policy.
I should like briefly to give the section 8 Industry Act figures for selective assistance. I can tell my hon. Friend that 309 projects in the North-West, costing almost £178 million, have been offered assistance amounting to £30 million under this section. We believe that temporary employment subsidy and similar measures in the North-West region have assisted a total of more than 209,000 workers. I recognise the significant contribution which TES has made in the textile, clothing and footwear sectors, with which the region represented by my hon. Friends is fairly replete. Of course, they have specifically benefited from these special temporary employment measures. Consultation is going ahead to introduce legislation to improve arrangements for the compensation of workers on short-time working. Such legislation was mentioned in the Gracious Speech. The consultations are continuing. Of course, from 1st January 1979, the small firms employment subsidy will be available throughout the North-West region.
Obviously, we place great emphasis on the special development areas in the North-West, areas such as Skelmersdale, Merseyside and the partnership areas. That is why under the urban programme 563 some £30 million is going to the partnership areas of Liverpool, Manchester and Salford.
Apart from that, my hon. Friend referred to a North-West development authority. This is not the first time that this question has cropped up. However, I must tell him— and I say it as a member of the national executive committee of the Labour Party —that there is a great deal of dissension within our party about elected democratic regional authorities and how we should go forward in that regard. He talked about investment decisions being taken regionally and more democratically. I hope he will realise that wherever he goes in regions of our party, and whenever he goes to different regions, there is a great deal of different feeling.
I hope that my hon. Friend will also take cognisance of the fact that, if the North-East and North-West had their own development authorities, then, as surely as night follows day, Yorkshire and Humberside, the South-West, the Midlands and the South-East would want theirs. My hon. Friend should recognise that there is no automatic salvation in setting up development agencies, although I recognise that these policies have been advocated from time to time.
I am glad that the hon. Member for Workington paid eloquent testimony to the fact that our regional policies have had the effect of diversifying the base, and certainly strengthening the industrial base, in both the North and North-West for when the upturn comes. With the communications links of the M6 and the electric rail services which the North-West enjoys, I should like to think that, as a result of the overall picture of regional policies, the North-West has considerably benefited.
I want to say a brief word about textiles. Because of the very tough line taken in the GATT multi-fibre arrangement talks, virtually all of our imports from low-cost sources are subject to actual or potential restraint. I think that we have negotiated an arrangement which is a great improvement on the one which existed before, and we certainly hope for a substantial fall in the rate of increase in imports.
564 In addition, from March 1974 until June this year, under section 8 of the Industry Act, we offered about £20.5 million in assistance to firms in the textile industry, and a further £23.5 million under section 7 to firms in assisted areas. We estimate that this latter assistance will create about 13,000 jobs and safeguard a further 13,200 jobs. In addition, textile firms undertaking investment in assisted areas have qualified for the payment of about £44 million in regional development grants.
That is a fairly comprehensive package under sections 7 and 8 of the Industry Act to assist the textile industry. The wool textile schemes, the scheme for the clothing industry, and the textile machinery scheme have brought to firms in the North-West assistance of about £8.7 million. Under section 7 of the Industry Act, the textiles and clothing industry in the North-West has received £18 million in assistance towards projects costing £151 million. We estimate that that assistance will safeguard 9,300 jobs and create 11,500 more. The North-West has benefited from the total package of assistance, although I recognise the case made by my hon. Friends.
I am grateful for the tribute by the hon. Member for Workington, in a confused speech, to the success of our regional policy in the North. His pleas on behalf of Workington should be addressed first to his own Front Bench. At Question Time after Question Time his party has advocated the dismantling of regional policy. We are worried by the articles in the Financial Times and the steady drip, drip of propaganda by the hon. Members for Kingston upon Thames (Mr. Lamont) and Rushcliffe (Mr. Clarke). It is hard to know what they mean, since they say different things on different days from different Benches.
According to the Financial Times— I am sorry that that is our main source of information—Opposition Members want to cut regional development grants by between £200 million and £300 million a year. In "The Right Approach ", they talk of raising the limit for industrial development certificates to 30,000 to 40,000 sq ft. One wonders how much of a regional policy will be left. The hon. Members' plea for the restoration of freedom of enterprise is not borne out by the events of 1971ဣ74, when precisely that 565 policy was carried out—and when the then Prime Minister had to plead with the Institute of Directors because companies still were not investing. Those policies benefit the asset strippers and office block speculators—certainly not the people in the constituency of the hon. Member for Workington.
§ Mr. Richard Page
I agree that the money supply was inflated then, but since 1974 it has been running at high levels. Under the Minister's fantastic policies, production has yet to equal that of the three-day week and 1½ million are unemployed, with hundreds of thousands hidden in job creation schemes. With all the jobs created and saved, why is not unemployment down to 600,000?
§ Mr. Huckfield
The hon. Gentleman has not been a Member for long and will not be one much longer, but under the Conservative Government increases in the money supply were between 25 per cent. and 30 per cent. annually, deliberately stoked up, compared with 7 per cent., 10 per cent. and 12 per cent. under this Government. If the hon. Gentleman thinks that it can all be explained by increases in the velocity of circulation, he has not seen the M3 figures published recently. The biggest increases in the supply of money were created as a result of a deliberate policy by the Tory Government because they thought that that was the way to get the economy moving. All that it gave us in the end was 27 per cent. inflation.
Let us consider the Conservative quotations and promises, and the speeches of the right hon. Member for Leeds, North-East (Sir K. Joseph). He said:In aggregate, we believe that these subsidies… do more harm than good… We believe that subsidies and grants and, indeed, the industrial strategy distract management and workers…"—[Official Report, 4th July 1978; Vol. 952, c. 255–56.]I hope that the hon. Member for Workington will say that to firms in his constituency which receive grants and subsidies. I hope that the people of Workington will read very carefully what the hon. Gentleman said this morning.
Finally, I am grateful to my hon. Friends for the comprehensive and detailed case that they have made. I take to heart what my hon. Friend the Member for Ince said about making our unit costs and performance more competitive. That 566 is the key. If our industrial strategy is to succeed, and if we are to succeed in export markets, it is the competitiveness, performance and unit costs upon which we should concentrate. He made a significant point there. I can reassure my hon. Friends that we shall look into the points they have made. I hope that they realise, however, that without the Government's policies disaster could have befallen the North-West. Our policies have achieved success, although we still have a long way to go.