UNEMPLOYMENT

HC Deb 24 November 1978 vol 958 cc1619-710

11.5 a.m.

Mr. Frederick Willey (Sunderland, North)

I beg to move, That this House, while recognising and fully appreciating the action already taken to combat unemployment, nevertheless believes that more needs to be done, and, in particular, calls upon Her Majesty's Government to take further special measures in the case of Sunderland and similar areas which are suffering persistent exceptional high levels of unemployment. This is part of a continuing campaign. I speak for the whole of Sunderland. The campaign is non-sectional and all-party, backed throughout by the Sunderland Echo. The special case for Sunderland has been recognised in all parts of the country, and in particular throughout the Northern region. The hon. Members for Newcastle upon Tyne, North (Sir W. Elliott) and for Berwick-upon-Tweed (Mr. Beith) have backed the claims of Sunderland. That re-emphasises that this is an all-party matter. It is remarkable that we should have this support throughout the region because the region itself has the highest unemployment rate in Great Britain. It is the only region where the rate of unemployment is higher than it was a year ago.

We are always exhorted to help ourselves. We have practically broken our backs in pulling on our boot straps. We have done all we can possibly do to help ourselves. The other day we had the gesture of the borough authority undertaking to employ 100 extra teachers at its own expense. If one looks at the figures of the take-up of the provisions that have been made, there may be a case for in forming us rather than persuading us as to how we might take better advantage of some of those provisions. If the Government can help, we will readily respond.

The motion is not an expression of formal courtesy. We fully appreciate the actions that the Government have taken, particularly the actions of Ministers in meeting deputations and visiting Sunderland, and, more important, paying heed to our representations. I think that the Government will concede that some of the measures they have taken nationally have been aided by the representations we have made on behalf of Sunderland. I also recognise that there has been some improvement. The unemployment figures have fallen in recent months. Indeed, there has been some faint sign of industrial recovery.

But the fact remains that, in spite on all the actions taken, Sunderland, as Ministers have conceded, has the most concentrated unemployment problem in Britain. We still have an overall unemployment rate of 12 per cent. to 13 per cent., with male unemployment far worse. I do not say that at present we are the worse-placed town in the country. My hon. Friend the Member for Hartlepool (Mr. Leadbitter), if he has the opportunity, will tell the House that in Hartlepool 30 unemployed people are chasing each vacancy. That is an appalling position for a town to be in.

However, over the years Sunderland persistently has been the town with the worst unemployment in Britain. Despite all that has been done through regional policy, job creation, "Springboard", community service, and the rest, we still suffer this eroding blight of heavy unemployment. There are wards in my constituency with an unemployment rate of 30 per cent. In the town as a whole, 21 per cent. of the disabled are out of work. We suffer the double tragedy of young people leaving school with little or no prospect of work and long-term male unemployment. It means that unemployed men have a one-in-four chance of remaining unemployed for over a year. If they are 45 or over, they have a fifty-fifty chance of being out of work for at least a year. In this country we have not only the general problem of unemployment but the particular problem of a few concentrations of heavy, unacceptable unemployment. But this problem is equally a national responsibility and we must find new means of tackling it.

The other day I had lunch with a civil servant who told me that he was worried and upset. I asked him why. He said that it was because he felt that we had an incompetent Administration coupled with incompetent democratic surveillance. I believe that this is true. This is not a criticism of individuals; it is a feeling that we have a generally incompetent and frustrating system responsible for our affairs. Certainly this cancer of frustration blights the Northern region more than anywhere else. Our shelves are stocked with plans, reports, studies, inquiries and investigations, but the Whitehall response is so ponderously slow that, by the time there is a reply, circumstances have so changed that all we can do is to have another inquiry.

The last inquiry was carried out by the Northern region strategy team. It pursued its study for 2½ years, reporting in March 1977. At Question Time the other day all that the Minister could tell me was that the inter-departmental discussions would soon be concluded. The report made it clear that the team wanted urgent, immediate action. This is typical. We can get intelligent diagnoses and recommendations by the score. But we can seldom obtain effective and ready action.

For example, in 1966 we had the report The Challenge of the Changing North "issued by the Northern Economic Planning Council. It was widely acclaimed throughout the region. The report pointed out that the Northern region was the only region which had not had a new university and that Teesside was the largest industrial area without any university. One of the most important recommendations of the report was that we should have a new, technological university established on Teesside. This was not a novel suggestion. It was simply calling for the implementation—and providing a location—of one of the most important recommendations of the Robbins report of 1963, namely, that we should have a new, special institution for scientific and technological education and research. That was 15 years ago. Nothing has been done and the results are catastrophic.

Education is at the heart of modern industrial society. The Japanese will readily explain that. We are currently concerned about microprocessing. Not only are we behind the United States and Japan, we are well behind Germany and France. This is largely because we failed to implement the Robbins recommendation. In the North-East, although the university of Newcastle and the Newcastle polytechnic, together with Computer Analysis and Programmes, are setting up an institute, this is too little and very late. If only we had the technological university, not only would we still be in the race internationally, but there is no doubt that the INMOS project, with the prospect of 4,000 jobs in the 1980s, would have gone to the North-East.

I do not blame individuals for all this. The trouble is that we cannot discover the individuals to blame. The result is that crucial priorities, indeed anything positive, is lost in an enormous, amorphous administrative mish-mash. First and foremost, therefore, if we are concerned about such problems, we have to campaign for radical administrative and governmental change. I am convinced that in the Northern region, if only for our self-protection, we have to make devolution a major political issue—not stridently, nationalistically, but sensibly. Administration and government must be better identified and responsive. I have read and heard the Gracious Speech. There is no immediate prospect of achieving devolution.

Consequently, I am driven to repeat the two basic essential demands that we have made for the North. First, I renew the demand that we should have a Minister responsible for the North. It is necessary to redress the disadvantage which we suffer in relation to Scotland and Wales, each of which has a Secretary of State in the Cabinet. What we are mainly concerned with is selective aid. We must have a Minister in the Cabinet when decisions are taken. Secondly, we should renew and press our demand for a Northern development agency. We have made some progress. We have the regional board of the National Enterprise Board. It is not enough. We are all conscious that we are seriously prejudiced by the growth of the Scottish and Welsh Development Agencies. We need one of our own.

I turn now to the question of Sunderland in respect of which we make the same approach. We should have a special commissioner for Sunderland—or, as the Sunderland Echo put it when I first made the demand, a "jobs supremo". We should have someone appointed by and directly accountable to the Government buc based on Sunderland and dependent for his job on the amount of work he helps create. Perhaps his remit could be to bring down our unemployment rate to single figures. Only in this way, by having an identifiable person responsibility, will we get the dynamism that we need to tackle the job.

This is an entrepreneurial job. We want an entrepreneur backed by Government resources, to break away from the present rigid bureaucratic pattern. Let me give an example of what I mean.

The Secretary of State for Industry has argued with us that there is no need for us to concentrate special development area policy. This is because he says that he determines the advance factory programme and can discriminate in favour of the specially hard-hit areas—" The worse you are, the more advance factory programmes you get." That is the Ministry's prescription. In Sunderland over the past four years we have had 16 advance factories authorised. All of this is welcome. I do not want to discourage it. But it is not what we want. In a Question the other day, I asked how many people were employed in Government-owned factories in Sunderland. I was given the figure of 3,880 people. That is fine. But I also asked what were the comparable figures 12 months before. Unfortunately, that figure was 280 higher. In other words, last year, in the Government-financed factories we lost 280 jobs. To put it another way, these Government factories added 280 people to the unemployment queue.

At the moment we have a large number of Government factories standing idle. All that we can do is to go on building more of them. That is the only formula on which the bureaucrats can work. I do not want to discourage this. We welcome the factories and hope that they will be used some day. But it is much more important to get work into the empty factories now. This is where a special commissioner would help, and, in my view, he should be backed by a publicly financed corporation not to build factories but to help provide and finance work in the factories already standing vacant. I know that this would have the support of the Tyne and Wear and Sunderland authorities.

One of the disadvantages of the present system is that we need much more imagination and initiative. Building factories is not the only inducement to attract industry. Perhaps the best way to attract industry is to have an attractive environment. Therefore, I agree with the general manager of the Washington corporation, who is making out a case for damming the river at Hylton, clearing up dereliction, and landscaping. This would provide jobs for the unskilled unemployed, who are our greatest problem. What is more, it is vital to attract outside industrialists to Sunderland.

I would say the same about communications. They have been enormously improved in recent years. We are fortunate in Sunderland in having an airport, but we must develop it urgently to take international traffic. As the general manager points out, this is what a salesman—the special commissioner—would call a unique selling factor.

My right hon. Friend the Secretary of State for Transport visited the port in the summer. At any rate, we are making progress. We are now busily defining the options. However we define them eventually, we are envious of the steps which the Government have taken in respect of docks such as London and Preston. We think that we ought to have our turn now.

The port is important not only as a port but because it is probably the most important industrial site in the town. As a port, we want inducements to see whether we can attract some of the coastal trade. This is entrepreneurial work. We want to do this because, with the faciltiies that are there, we believe that we could attract maintenance and repair work away from the Dutch. It is a sorry reflection upon us that our coastal trade and its upkeep should now be in the hands of foreigners.

That brings me to the subject of Green-wells. I have reason to believe that the corporate plan will provide for the return of Greenwells to repair work. This will be especially welcome after our efforts over the past few years. As we argued at the time, it is a very costly business to keep Greenwells closed, and we are disappointed that more effort has not been made to make use of these facilities meanwhile. It is unfortunate for shipbuilding in Sunderland that there are these additional expenses to bear.

As for the port as an industrial site, we put forward a proposal some time ago that we should have a mini strip mill there for processing scrap. That would be on the Bartram site. This may seem out of place at present, bearing in mind the condition of the steel industry, but it is relevant in the context of shipbuilding. There are great pressures now to bring in a scrap and build policy. If we have such a policy, we want to see that the employment is kept in Sunderland and one way of doing this would be to provide that the scrapping and processing was carried out in the port.

Mr. Ted Leadbitter (Hartlepool)

Although my right hon. Friend has a justifiable concern about Sunderland, I hope that he will bear in mind that the argument which he has described so well should include such yards as Haverrton Hill.

Mr. Willey

I can see at one, that my hon. Friend has a case in respect of his constituency, because he has steel-making interests there. I do not say that the case which I have made is unique to Sunderland; it also affects other shipbuilding areas. But if this is a good site and if there are good prospects for this development, we should ensure that they are considered seriously. If we had a run-down. it would be of 'enormous advantage to us to ensure that we benefited from any expansion in the scrapping of present shipping.

I had not intended to say very much about shipbuilding. I have assumed that, when at last we get the corporate plan, we shall have to debate it in the House. I have always been realistic about redundancies in shipbuilding. It may be that this does not affect us all that much in Sunderland. We are fortunately placed. We are in a relatively strong position. We have the two most efficient yards in the country.

Our concern at the moment is with local autonomy. We are a high-wage, high- productivity area, and we intend to remain so. I remind British Shipbuilders that autonomy is written into the Act. I remind the Government, incidentally, that so are provisions about Government intervention on employment. There are two provisions in the Act which are important to us in Sunderland. The first is that our local autonomy is safeguarded statutorily. The second is that the Government's involvement in this industry is also written into the Act.

We are flattered by references to Doxfords in the annual report of British Shipbuilders, but we are disappointed that we still have no response to our many proposals about Doxfords, especially on marine engine crankshaft manufacture. Some progress has been made, but we are held up because there is uncertainty about marine engineering as a whole. Nevertheless, it is time that we had a much more positive response about Doxfords.

I have dealt with a few of the matters which affect us in Sunderland because I believe that consideration of such matters is vital to any effective employment policy. I could have dealt with many others. I could have dealt with the liquefaction plant for coal. I could have dealt with the skillcentre, which is a particular responsibility of my hon. Friend the Under-Secretary of State. We still have no skillcentre. This is vitally important to us in Sunderland. We want training tailor-made for our prospects and difficulties. I could criticise previous planning by saying that it is bad planning that half the vacancies in the skillcentres round Sunderland are filled by people from Sunderland. But we are more concerned to get an effective realisation of our difficulties and prospects and to deal with them in Sunderland.

I could have run through the borough's recommendations on unemployment. Some of them have been met, others have not. But I assure my hon. Friend the Under-Secretary of State that we keep a checklist and that we shall follow them up. We do not regard this debate as ending the argument. It is continuing it.

The problems of the distressed districts with endemic heavy unemployment must be tackled at ground level. I have made a special case for Sunderland because. with its persistent heavy unemployment, I believe that we can show that we need the dynamic co-ordination and co-operation of local activity backed by Government resources. If this were done as an experiment, I believe that it would not only be effective in helping reduce our own unemployment but that, as with similar action taken in the 1930s, it would lead to new approaches to the problem of unemployment generally. Lessons would be learned which could help nationally.

I argue the case not only in the direct interests of Sunderland but in the interests of us all in dealing with the problem of unemployment. The lessons would he invaluable elsewhere.

11.30 a.m.

Sir William Elliott (Newcastle upon Tyne, North)

I am sure that hon. Members on both sides of the House are grateful to the right hon. Member for Sunderland, North (Mr. Willey) for his choice of subject and for his having raised in the most reasonable terms the problems particularly of Sunderland, which those of us from the North-East so much appreciate. The problem of unemployment in our region is, sadly, of many years standing. Of all the places in the region. I agree with the right hon. Gentleman that Sunderland has had the most stubborn unemployment problem to solve.

No doubt the Minister who is to reply has taken full note of the right hon. Gentleman's pleas about Sunderland. I should like to take up a few of the points that he has made and add some remarks of my own about unemployment in the region as a whole.

I think that the right hon. Gentleman is right to suggest that we must see the problems of our region in terms of the major one concerning devolution. I do not know whether it would be right or feasible again to have a Minister for the North, or to have a development agency. The argument against a development agency for the Northern region or—with respect to the hon. Member for Houghtonle-Spring (Mr. Urwin)—against a Minister for the North has always been that, if we had them for the North, why not have them for Merseyside, Humberside and other areas?

The right hon. Gentleman is right to say that devolution represents a danger to the Northern area. When the first proposal for devolution for Scotland and Wales came before the House—the first aborted Bill—we had a four-day debate on the Second Reading, in which I took part. I am on record as saying then that should there be a Scottish Parliament in Edinburgh, with Scottish Members and Scottish civil servants and Lobby correspondents, just over the border from the Northern region of England, it must give Scotland a considerable advantage in attracting jobs.

The Scottish Assembly will obviously have a powerful voice. I expressed on Second Reading my disagreement with the Scottish Assembly and I express it again. In that debate I expressed my belief that the Green Paper "Devolution the English Dimension" should have been produced long before we had the Bill to set up Assemblies in Scotland and Wales. I believe, particularly in terms of industrial development, that we must think in a much broader way about regional Assemblies, whether we call them Scottish, Welsh or Northern Parliaments, or whatever. I strongly echo what the right hon. Gentleman said about devolution having a heavy bearing on our problem. The current high national unemployment rate is bound to reflect on the regions. It always has and always will. With high unemployment, the regions and development areas in particular always suffer more than other parts of the country.

It is essential that in this debate we face certain hard facts about the Northern region. It is no good putting our heads in the sand over the shipbuilding recession. The world recession in the building of merchant ships is very serious for the Northern area. It is no good our avoiding that fact or attempting in any way to cover it up.

We still have, as the right hon. Gentleman said, a lamentable shortage of skill in the Northern region. I asked this week about the number of unfilled vacancies in the Northern region. There are almost 11.000 jobs going, but obviously not the people with the skills to take them up. I was pleased that the right hon. Gentleman mentioned the 1963 Robbins report. I remember in the House welcoming the report and its suggestion that there should be a university of technology in the rapidly developing Teesside area. I agree with the right hon. Member for Sunderland, North that this would be of the greatest assistance to the Northern region. I was surprised to learn today that there is no skillcentre in Sunderland. May I add my plea to the Minister in suggesting, as the right hon. Gentleman so aptly put it, that we badly need to tailor our skills to our requirements. That has always been a requirement during the time I have been a Member of the House. I have always felt that, despite the enormous efforts made by Governments from each of the major parties, we have never faced up to our skill requirements. I remember years ago questioning the right hon. Member for Blackburn (Mrs. Castle) on this point when she was a Minister. I asked whether she, as the Minister responsible. had enough knowledge of the skills needed by industries coming into our region. I remember the answer I was given. It was that such information was available. I did not think it was then, and I still do not think it is now. We need to study more the skill requirements of incoming industry.

The right hon. Gentleman has once again raised the question of a development agency for our region. Over the years, since the late 1950s when I became a Member of the House to represent a part of the region, there has been steadily increasing unemployment. We have had a series of agencies. With Lord Glenamara, when he was a Member of this House, I took part in the steering committee procedures when we converted the existing agency to bring work and employment to our region.

The body was then called the North-East Industrial Development Association. The steering committee was set up because NEIDA was thought to be inadequate and we eventually set up the North-East Development Council. The council has done a great deal of work, but before adding to the number of agencies it is worth recalling that it was said at a number of the steering committee meetings that the region at that time was far too parochial in its efforts to attract industry.

Sunderland was fighting with South Shields and Newcastle with Teesside, for anything that was going. It was suggested that if we set up this new body, the North-East Development Council, it would be much more broadly representative of both sides of industry—the trade unions and the employers—and local authorities than the original body and then we would get over this internal squabbling.

It is salutary to appreciate that after all these years we have in the past year employed a public relations firm to promote the interests of Newcastle. As the right hon. Member for Sunderland, North has said, Sunderland has done a great deal to help itself. I agree. Most places in our region now have to seek work for themselves regardless of agencies that are in being. I do not disagree with public relations firms being employed—they are probably necessary—but before we think about a new agency it is worth putting on record that we appear to have come full circle, and have returned to internal parochialism on the attraction of the jobs.

In 1964, with the advent of the Labour Government, the Northern Economic Planning Council was established. Those were the days of the national plan. I shall not be partisan today, but I cannot resist asking whatever happened to the national plan. Lord George-Brown, who was then a Member of this House, was responsible for the production of the national plan, and I am sure it was absolutely well meant.

The Northern Economic Planning Council was, in its turn, supposed to cure all the industrial and development ills. When it had been in existence for some time, a meeting was held in Wellbar House, the mini Whitehall in Newcastle, to which all Members of Parliament for the region were invited. I remember Lord Shinwell, who was then a Member of this House, asking the chairman after the discussion "What have you achieved so far?" The chairman replied "At least we have brought together the 13 planning authorities."

It had always been a little difficult to know what the NEPC is doing. We have always been given the impression that it was undertaking deep studies of that which was wrong, getting rid of parochialism and bringing in the planning authorities together. But, before thinking of setting up a new agency, it is appropriate to recognise that this body has not been as successful as was hoped.

I mention one other body which is the oldest of the lot even though its name is more recent—the English Industrial Estates Corporation. It has its headquarters in Team Valley—the oldest trading estate in the country. It was set up in the 1930s and has been very successful. We wish the corporation's new chairman every future success. There is probably more expertise, knowledge of what is required in the region in the form of new industries, knowledge of the particular skills that exist and those that are needed in future in the headquarters of that corporation than anywhere else in the region. It is doing a very good job.

I talked to the chairman and officials of the corporation a few weeks ago. I am not quoting them now, but I see the present role of the corporation as being a Civil Service role. The purpose of the corporation is to state the facts. It tells would-be industrialists coming to our region where there are advance factories. However, it does not seem to have the power of recommendation. I wonder whether it is possible, before we set up a new agency, to have a good, hard look at the present agencies and what they are doing. Is it possible to give the corporation more power of recommendation than it has at present and more power to advise?

I commend most warmly the recent decision of the Tyne and Wear county council to set up a research unit in a submission for INMOS. There is no doubt that this £400 million micro-electronics project, with its potential employment of 3,000, is exactly what the Northern region requires now that its shipbuilding and coal industries are declining.

It is excellent that the Tyne and Wear will grant £100,000 a year for three years for setting up a research unit. I understand that that unit, which will attempt to bring various types of technical development to the region, will be established in Jesmond Road, in my constituency. I commend its inception.

I also commend the initiative of the Durham University Business School in inaugurating a build-your-own-business scheme. This is being done in conjunction with Shell, which is providing a lot of money. This is an example of getting down to the practical possibilities. It is not just a matter of big business in the region. We must encourage small businesses a great deal more than we [...] ve done in the past. We need entrepreneurs of all sorts, as the right hon. Member for Sunderland, North said. I think he was thinking in terms of an official in Sunderland having an entrepreneur status. Unless we can make it progressively easier for small businesses to employ people, we shall get deeper and deeper into unemployment.

It will not be the intention of an incoming Conservative Government—and I hope that my hon. Friend on the Front Bench will confirm this—to repeal the Employment Protection Act. However, believe we need to amend it. Some Labour Members may say, quite correctly, that the Government instigated an inquiry into the Act's workings to find out whether it had prevented businesses from employing people. It is only fair to comment that that inquiry took place, and certainly it stated that the Employment Protection Act was not having an adverse effect on employment. However, the inquiry did not take account of those firms employing 500 people or fewer.

As I travel around my constituency, worrying constantly about the unemployment problem, I talk to a lot of employers with 500 employees or fewer—or 50 employees or fewer. I assure the Minister that the Act troubles the small employer. We should consider its provisions urgently with a view to making it easier for small businesses already in the area or those that might be attracted to come to the area. We should make it easier for them to employ particularly younger people.

We must also consider the problem of attracting the executives and skilled personnel who are needed for the new industry which we hope will come to the area. Most of the new industry which has come to the North-East has had to bring with it its managerial staff and often its technical staff.

We have done a great deal to improve the area, but we cannot say too often that the Northern region is a more attractive place in which to live and work than is generally believed by people living in other parts of the country. We have done much to improve the general environment and communications. We have the new high-speed trains. I hope to be in one of them before many hours elapse. Once again I shall be taken to Newcastle efficiently, in the greatest comfort and in a remarkably short time. I commend British rail for introducing the high-speed trains. I hope that one day it will do something about the acres of dereliction that one sees as one approaches Darlington station. I commend British Rail for improving our communications.

Mr. Leadbitter

I do not wish to hurry the hon. Member to catch his train. He is making a long and interesting speech. He has stressed the importance of the area. Perhaps he would say something about the adaptability of labour in the region. Over the years the workers have shown that they can speedily adapt to new skills. This is a bonus for industry which comes to the area.

Sir W. Elliott

I agree. Our labour force is good and adaptable. There was a time when the workers were loath to move from one side of the Al to the other. Workers must learn that they might have to travel further to work than they used to do. I remember that in the early days of rising unemployment in the North-East Labour Members advocated a new industrial concept based on the location of the pits. We are now way past that stage.

I return to the problem of attracting executives to the region. I am trying to make realistic recommendations for bringing new employment to the region. Not only are we having difficulty in attracting executives, managing directors and those with required skills, but some executives are leaving the region. They are not leaving to go to the Midlands and the South-East as they used to do; they are going further afield to Europe where the rewards are greater.

I appeal to the Minister and to members of my own Front Bench—and I hope that a Conservative Government will be in power in the not too distant future — to recognise that we must reduce taxation on those who lead in industry, whether in a managerial or a technical sense. This must be done urgently. Those at the top in business and industry are over-taxed. This harms employment in areas such as the North-East.

I appeal again to the people of the Northern region to do everything that they can to help themselves. I agree with the right hon. Member for Sunderland, North that places such as Sunderland have done a great deal. They must continue to do that. Our unemployment rate is high. But it is eased by the job creation programmes which nationally cost £350 million in the current year. The sooner we have real employment, the better.

By all means let there be inter-union discussions about who should do what and the question of pay in different sections of industry. I hope that on both sides of industry—management and trade unions alike—there will be full realisation that the world does not owe the United Kingdom a living and that the rest of the United Kingdom does not feel that it owes the North-East a living. Let us avoid wherever we can wasteful, expensive and harmful industrial disputes such as that which lost us the Polish shipping order a year ago this week. I hope that the debate will be seen as part of a continuing process to improve and extend the employment prospects for the Northern region.

11.55 a.m.

Mr. Arthur Bottomley (Middlesbrough)

My right hon. Friend the Member for Sunderland, North (Mr. Willey) deserves our thanks for choosing this subject for discussion. Not unusually, I am substantially in agreement with what he has said. I thank him for his references to Teesside.

Future generations will find it difficult to understand why we are unable to solve the apparently simple problem of keeping men and women usefully employed when scientists can make precise calculations so that astronauts can be landed on the moon and brought back safely.

Full employment does not necessarily mean going down the mines or working 40 hours a week in an office or factory. With the increasing development of automation and computers, machines inevitably will do, to an increasing extent, the work which was previously done by humans. Great advances are being made to speed up that process.

When I was Secretary for Overseas Trade I visited the GEC research laboratories with Sir Harry Railing who was then the chairman. He introduced me to electronic technology. He forecast the coming industrial revolution as a result of transistors. That revolution is upon us. It is gratifying to know that Britain has accepted a vital role in the world-wide micro-electronic chips development. Micro-circuits will affect not only manufacturing industries but commercial communications and every day life in the home. We in the North-East intend to make every effort to have a microelectronic production factory. I hope that such a factory will be built in Cleveland. From the development of such a factory we could look forward to the creation of a new industrial network involving independent supplies, as well as the use of micro-electronics in our existing industry.

Not only do we have the necessary labour and technical skill in the North-East, but the environment and geography of the area gives it great advantages over other parts of the country. The North-East Development Council, under the chairmanship of Councillor Mrs. Taylor, has done much to press for the industry. I hope that the Government will listen to her case which is presented after much thought and discussion with the local authorities. educationalists, trade unions and industry.

Micro-technology represents a drastic change in industry. It will change our institutions, our ideas and our way of life.

The Government proposals for improved education and training for the unemployed, especially the young unemployed, are greatly welcomed. At the Cleveland Careers Convention, organised by the British Steel Corporation, the per. manent secretary at the Department of Education and Science said that there was a shortage of further education facilities for young people. The purpose of the convention for sixth formers was to attract technicians, computer operators and other professional people to the new-technology steel world. It is not only the young who desire to increase their knowledge. Education is a continuing process, and does not end when one leaves school or university. Yet the Government's spending plans mean that this year 1,000 fewer teachers will be employed in England and Wales.

My right hon. Friend the Member for Sunderland, North referred to the need for a university on Teesside---a move that is long overdue. I hope that the Minister will convey to his right hon. Friend the Secretary of State for Education and Science the fact that this subject has again been raised in the House, and that the North-East, as well as Teesside in particular, will not be satisfied until the university has been sited in that area.

It is easy to talk about cuts in public expenditure, but such cuts can be justified only if they effect a reduction in our expenditure of foreign currency—and in most cases they do not. We all know that we have to pay our way in the world. To do this we have to produce the goods required in the world markets at the right prices, and we must keep to delivery dates. Investment should be channelled into those industries which are best able to undertake this task. We as a nation possess the inventive skill and British management and its workers are as capable as those of any other nation.

I am sorry to say that in the last decade Britain's share of the market in manufactured goods has fallen from 13 per cent. to 9 per cent. Yet 1 per cent. growth in our economy would bring in as much as we earn from North Sea oil and provide jobs for 400,000 people.

We have to concentrate on supplying the foreign producer rather than the consumer. It is becoming clear that to earn our living in the future we shall have to sell not so much consumer goods as the means with which to make them. It is shortsighted to say that this is a onceand-for-all business. This is an expanding market because there is always a demand for replacements and fittings. A higher rate of economic growth is the only certain way towards higher standards of living, higher wages and full employment. The strength of the pound should not depend on what foreign investors do with their money. It should rest on increased production and a growing volume of exports to all countries. Priority should be given to those things which give our people a good and secure standard of living and an opportunity to enjoy a fuller and a richer life.

I suggest that the Government should consider carrying out a policy of national development. We should appeal to the whole nation by every means of publicity and propaganda to subscribe to a national development loan for the purpose of helping the nation to recover its greatness as a world power. Such a loan would be used to clean up our decaying inner cities, to exploit every piece of agricultural land. and to provide facilities for leisure and other amenities. Such action would relieve unemployment and make unnecessary the expenditure of the huge sums of money that are now being paid to the unemployed for doing nothing. To investors it would give security based on the credit of the Government.

All of use in this House, and indeed people everywhere, have a deep concern to feel that they are needed and that their lives are purposeful. There may be a minority of men and women who, provided that their material wants are met, would be happy to live idle lives. But most people desire a role in life. If we can find a solution to the problem of unemployment, I believe that this country will be a better place in which to live. Therefore, this discussion has been most useful. I appreciate that I have ranged a little more widely than the position in the North of England, but I certainly believe that the North-East, as one of the neglected areas of the nation, should at last be given priority.

12.6 p.m.

Mr. David Watkins (Consett)

Before I come to the main purpose of my remarks, I must explain to the House that this evening I have a long-standing, important constituency engagement into which I entered long before this debate was due to take place. I must honour that engagement and it may mean that I shall have to leave this discussion before the Minister replies. I apologise and hope that the House will understand.

I congratulate my right hon. Friend the Member for Sunderland, North (Mr. Willey) on his luck in the Ballot and on his choice of subject which has enabled us to have this important debate. My constituency, in common with the Sunderland area, also suffers persistent and exceptional unemployment. Even in good times the unemployment rate has been consistently double or more than the national average. Let me cite one example of the exceptional nature of our situation. About one-quarter of all the registered unemployment in the area are under the age of 20. That is a shattering measure of the nature of the problem and of its persistence. The overall position shows every sign of worsening rather than improving even if national unemployment now shows signs of a slow but steady improvement.

This is taking place in a special development area where maximum inducements are available to attract new industries and to expand existing ones for the specific purpose of providing employment opportunities. However, despite all that effort, more still needs to be done.

There are in my area deep-seated problems which go back a long way and derive from the near total rundown of coalmining and the present rundown of the steel industry. This is a traumatic situation in an area which was built on just those two industries. Consett and Stanley, the main towns in my constituency and many of the surrounding villages, came into being only because of the existence of coal and iron ore, and certainly the steel industry was built up in earlier days.

My predecessor, Mr. Will Stones, before he entered Parliament was a mines inspector. In the last speech he ever made in the House in December 1965 he re-countered that when he had entered the House in 1955 he had inspected 16 collieries in the constituency. When I succeeded him in 1966, the number had fallen to six. Today there is only one colliery—a very small operation indeed. In that period of years about 15,000 mining jobs have been lost. The largest employer of labour in the area at present is the British Steel Corporation. It is a measure of the area's dependence on that industry that about half of all employed men in the town of Consett work in the steel industry. Probably about another quarter of the total of employed people work in industries such as transport and construction which are directly dependent on the steel industry.

It is a fact that there is not a single retail shop, or any other form of service business, which is not dependent on the prosperity of the Consett steelworks. If the steel industry has to employ fewer people, all those other dependent industries are faced with the prospect of employing fewer people, thereby adding to the unemployment problem of the area.

In the late 1960s there were about 6,200 people employed in the steel industry. Even as the House is debating this matter, the British Steel Corporation and the trade unions are negotiating how they can deal with the latest announcement, made only two weeks ago, of more than 350 redundancies. That is the second announcement of redundancies in the steel industry within a matter of months. The total number this year is nearly 1,000. All this on top of the situation which I have already been outlining.

The current redundancies will bring the number of employees to less than 4,500, and it seems likely that this is by no means the end of the road. This time next year the number of people employed in the steelworks will be less than 4,000, a reduction of substantially more than one-third of the labour force.

I have never known such despondency about the prospects for steel as exists in my constituency. The latest batch of lost jobs is in the plate mill, which has been under sentence of slow death since 1972. Since that year I have been raising this problem which exists in the plate mill ever since the publication of the then Government's White Paper which foreshadowed the closure of the plate mill. There is general feeling that the announcement of the final closure of the plate mill and yet more redundancies in the works at large is not far distant. That is the measure of the situation and the level of despondency which exists.

Only this morning I received a letter from the Derwentside district council—the local authority within which my constituency is situated—enclosing a copy of a letter sent to the Secretary of State for Industry asking him to receive a deputation from the district council, the Durham county council and myself to discuss the deteriorating employment situation of the Consett works and outlining measures which the Government may take to alleviate the unemployment problems within this district. This is a sentiment which is exactly in line with that expressed in the motion.

Still dealing with the subject of the steel industry, I remind the House that in the Government White Paper Cmnd. 7149, entitled "British Steel Corporation—the Road to Viability", the Government pledged their full suptx)rt and the use of their powers to help uevelopment cf those communities hardest hit by the BSC's programme of contraction. In practice—and this of course does not apply only in my constituency, notwithstanding that we have special development area status and the maximum possible deployment of re- sources to deal with the situation—it is clear that more Government intervention is necessary.

The hon. Member for Newcastle upon Tyne, North (Sir W. Elliott) made a very important point regarding the proliferation of organisations which have grown up. As he and my right hon. Friend the Member for Sunderland, North said, there has been a very considerable measure of self-help within the region. What we now have, apart from Governmental agencies, are local authorities, combinations of local authorities, and all sorts of organisations, all arising out of the desire in the North-East to do something for itself. In the event, this has produced a situation where we have many organisations which often appear to be competing with each other, rather than co-operating in order to solve the overall problem. As has been shown by every speaker this morning, we are confronted with a serious problem.

I draw the attention of the House to a very important document, which was adopted as the policy of the northern regional Labour Party at its annual conference in the spring of this year, called "Let's pull together for a better North" This makes a detailed and penetrating analysis of the situation of organisations competing with each other, and recommends that the Northern Economic Planning Council which, as the hon. Gentleman for Newcastle upon Tyne, North rightly said, has been in existence for a long time, which we hear all too little about, should be a co-ordinating body.

Amongst the problems of the council are that it is responsible to a proliferation of Ministries, carrying to a higher level the proliferation of organisations which exist in the region. The policy which is recommended to try to deal with this undoubtedly difficult problem is the restructuring and enlargement of the council, which will then act as the essential co-ordinating body for all regional development. This is a very practical suggestion which has been adopted by the regional Labour Party and is, indeed, in the hands of the Government. I say to my hon. Friend who is to reply to the debate that I hope that this matter is receiving the closest possible attention in Government circles. It is certainly something to which the Labour movement in the area has given the closest attention. It is aware of the problem and has made positive suggestions which we want to see adopted in order to deal with this particular aspect of the problem.

Having said that, I want to take up the very important point which my right hon. Friend the Member for Sunderland, North made on advance factories. Only last week I was told, in answer to a Parliamentary Question to the Secretary of State for Industry, that the total number of people employed in Government provided factories in my constituency was 768 men and 558 women. That is very welcome and the advance factory programme has done a major job of work in trying to contend with the problems of the area. But these figures show that this alone is not nearly enough to deal with the massive problem which exists in the area. On the same day, in answer to another Parliamentary Question, I was also told that, as part of the North-East special develoment area, my constituency is benefiting from the highest level of regional assistance in Great Britain. It was stressed that this assistance encourages the creation of new jobs and the safeguarding of existing employment.

My constituents and I appreciate the efforts made but, quite frankly, we are getting rather tired of complacent platitudes of that sort. We want jobs and not words. It is clear that we can get jobs only through Government action, because, with certain honourable exceptions, I make that as an important point. So-called private enterprise is just not interested in the problems of areas such as mine.

In 1945 Ernest Bevin said that there was "plenty of private but precious little enterprise". That is even more true today than when he said it. I quote now from an article in the Financial Times on 21st November, in order to substantiate that point. The article reported on INMOS, the micro-electronics firm backed by the National Enterprise Board, which has already figured in the speeches of hon. Members and which is something we all regard as of crucial importance for the North-East: INMOS is determined not to allow the Government to select the location of its plants purely on employment or social criteria, though it will seek to take advantage of development grants where it regards them as being tied to areas which are attractive on other grounds. If ever there was an illustration of the need for more public accountability and more tightening up in the disbursement of public funds and the creation of jobs in regions such as ours, that arrogant and cynical statement is a demonstration of it. It really makes the point for stronger Government action. If there were nothing else—and there is so much else—that alone would vindicate the call for stronger Government action such as is made in my right hon. Friend's motion. I strongly support the stand which he has made, and I hope that we shall receive a positive response from my right hon. and hon. Friends in the Government.

12.20 p.m.

Mr. Gordon A. T. Bagier (Sunderland, South)

Although he is temporarily absent, I also congratulate my right hon. Friend the Member for Sunderland, North (Mr. Willey) on his luck in having his name drawn out of the hat, enabling him to initiate a debate principally about Sunderland but on a motion wisely worded so that it could cover a wider area.

It is not often that we in the Northern region have an opportunity to debate our problems. This has been an experience which has annoyed us over the years. We have a Scottish day, we have a Welsh day, but we never seem to be able to have a debate on affairs in the Northern region unless one of our colleagues is fortunate enough to have his name drawn out of the hat, and then it usually comes on a Friday. Nevertheless, even on a Friday such an occasion is most welcome.

My hon. Friend went into great statistical detail about our problem in Sunderland. He outlined in graphic fashion how Sunderland has been particularly hard hit ever since the war years. We have seen the decline of shipbuilding and of the heavy engineering industry and we have been hit by the offshoot of the cutback in coalmining. We have always seemed to have twice the problems that everyone else has. Certainly, in unemployment terms we always seem to have had twice the national level, and this has applied equally in boom years and in bad years. Even in the boom years our problem remained stubbornly the same, with twice the national unemployment figure, and now, of course, the same state of affairs confronts us.

I shall dwell for a moment on some of the reasons which lie behind that situation, and I hope to suggest ways in which the Government can help us. Although I welcome the presence of my hon. Friend the Under-Secretary of State for Employment—I acknowledge that the subject of the debate refers specifically to employment—it is a great pity that we have no Minister here from the Department of industry since it is from that Ministry that we can often receive most help. However, I have no doubt that my hon. Friend who is present will, with his usual helpfulness, ensure that such comments as we pass and requests that we make are conveyed to the Department of Industry and to any other Department which is involved.

One of the factors to hit us recently has been what I can only describe as an acceleration of closures, especially in the past two years. We have suffered body blow after body blow. For example, in Sunderland we have seen the closure of the Plessey works with the loss of 2,088 jobs, the closure of the Jackson Tailors factory with the loss of 350 jobs, the DHSS child benefit centre in Washington affecting us to the extent of 350 jobs, the Bridon Fibre works with the loss of 230 jobs, redundancies at another Jackson Tailors factory with a loss of 601 jobs, at Howard Rotavators with the loss of 348 jobs, at Hyers of Sunderland with a loss of 223 jobs, at Coles Cranes with a loss of 165 jobs, and at Sunderland Shipbuilders with a loss of 125 jobs.

Thus, in just over 12 months there has been the staggering total of 4,480 jobs lost to us. In their place we have had a slight resurgence in the clothing industry, with some 250 jobs provided by Cope Sportswear coming from Leeds.

It will be noted that most of the factories closed have been in the private sector. Most of them have been parts of large companies with satellite factories in our area. This has been the burden of our problem over the years. When a large centralised company grows and establishes a factory in our area, though without its head office in the region, the moment there is a breath of cold air out it goes and the factory in our area is closed. This tendency has gradually made our situation worse.

In addition to the closures and redundancies to which I have referred, we now look with concern at the future of ship. building. I realise that my right hon. Friend the Member for Sunderland, North has the main shipbuilding complexes in his constituency, but I am sure that he will not mind my mentioning this matter. The future of shipbuilding is extremely worrying in Sunderland. We are proud to have the most efficient shipbuilders in the country. Our colleagues from Merseyside, Scotland and Northern Ireland are not here at the moment to dispute what I say, but I should say it even if they were.

The position of shipbuilding throughout the world is deteriorating. We learn that 40,000 to 50,000 Japanese shipyard workers—this is happening for the first time since the war in a major industry in Japan—are being laid off and more than 35 per cent. of their industry is being closed down in the face of the world recession in shipbuilding. It is without doubt—indeed, the House recognised this when introducing the Shipbuilding (Redundancy Payments) Bill—that somewhere in Britain, too, we shall be affected over the next few years by the ship building recession.

I only hope and pray that Sunderland will not suffer. I urge the Minister to recognise the efficiencies of the Sunder. land yards when closures are being considered and set that alongside our already serious unemployment problem. We have shown that we are good shipbuilders. We still have some orders. We can ful fil orders and deliver on time, making whatever the world wants, provided that the demand is there. It is remarkable that we are even building ships for a country which is completely land-locked with no seaport to its name. I pay tribute to the salesmanship and enterprise of British Shipbuilders and those who are going out to get orders for our yards.

I turn now to a matter which I regard as of the utmost importance, and here again I am glad that the motion is in terms which take the debate beyond Sunderland. One of the worrying facto, in the present situation is the impact of the apparent breakdown of the pay policy The pay policy is important, and anyone who disputes that should look at what has happened in the past two or three years.

A couple of days ago there was a headline in the Sunderland Echo when the unemployment figures were announced telling us Jobless total on the way down. For the third month in succession the jobless figures have fallen, albeit by a small amount, although the headline was referring to the national rather than the local figures. But in that context we must recognise that, if the Government' policies had not been pursued over the past three or four years to contain inflation, such a headline could not have been possible. The fact that we have brought inflation down from about 30 per cent. to single figures has had and is having effect in areas such as Sunderland and the Northern region. But there is a breakdown, I shudder to think what will happen to parts of the country such as mine.

I say to my hon. Friends to those hon. Members on the Opposition Benches who advocate a free-for-all—

Mr. David Watkins

My hon. Friend speaks of hon. Members on the Opposition Benches. In fact, apart from the hon. Member for Manchester, Withering-ton (Mr. Silvester) on the Front Bench, and the hon. Member for Newcastle upon Tyne, North (Sir W. Elliott) who has here earlier, those Benches have been and are still empty.

Mr. Bagier

I am grateful to my hon. Friend for pointing that out. In some ways, I suppose we in the Northern region are partially responsible because we very sensibly send so many Labour Members to the House. However, that only partly explains the absence of Conservative Members from our region, and, as my hon. Friend pointed out, the hon. Member for Newcastle upon Tyne, North (Sir W. Elliott) was present.

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

Perhaps I may intervene at this point. I came here under the impression that the motion was in general terms, relating to development areas and unemployment. Perhaps someone could clarify that for me, because I had assumed that this was a debate about unemployment.

Mr. Bagier

I am grateful to my hon. Friend the Minister, but it looks as though he will be sadly disappointed if he is looking forward, as I know he always avidly does, to contributions on these matters from the Conservative Opposition.

Mr. Ernest G. Perry (Battersea, South)

I do not think that I am speaking out of turn here, and I must try to eradicate some of the conceit of my hon. Friends from the North. I represent a London constituency, and we are just as concerned in inner London about unemployment as my hon. Friends are in the North-East. Let there be no mistake about that.

Mr. Bagier

I am grateful to my hon. Friend the Member for Battersea, South (Mr. Perry). Again, he has illustrated the absence of Conservative Members.

Within the past two or three weeks I understand that reference was made to the attendance of certain hon. Members connected with shipbuilding when an exchange was taking place on shipbuilding matters. In fact, my right hon. Friend the Member for Sunderland, North was present. Also present were one or two of my colleagues who are directly affected by such matters. However, a certain organ of the press said that there were no Labour Members present who represent shipbuilding constituencies. If that organ of the press is gazing down on this august assembly, I hope that it will notice the complete absence of Opposition Members during a general debate on unemployment. My right hon. Friend the Member for Sunderland, North rightly worded the motion in wide terms.

Mr. Willey

On a point of order, Mr. Deputy Speaker. Is there any provision preventing blind persons sitting in the Gallery from reporting our proceedings?

Mr. Deputy Speaker (Sir Myer Galpern)

I shall take that to avizandum.

Mr. Bagier

I can assure you, Mr. Deputy Speaker, that my hon. Friends and I know exactly what my right hon. Friend means. We resent the reporting of a few weeks ago.

I return to the theme that I was developing. Pay policy has an effect on unemployment throughout the country, including my area. My right hon. Friend the Chancellor of the Exchequer, when replying to my question on his pay and prices statement, recently deplored the fact that it had not been possible to reach agreement with the TUC general council. He said that the economic committee of the TUC general council had unanimously accepted that the formula that had been put forward for acceptance could have been recommended to the trade union movement as a whole. The general secretary of the union that sponsors my membership in this place, Mr. Sidney Weighell, said: We are voting against a great opportunity." —[Official Report, 15th November 1978; Vol. 958, c. 421.] My right hon. Friend the Chancellor of the Exchequer, when referring to inflation figures, referred to the effect that the absence of agreement would have en unemployment. There is no doubt that if wages start to go through the roof there will be chaos. There is no reason why labour costs should not be considered in the same light as the cost of a commodity. For example, if a motor car becomes too dear, we cannot buy one. If an item of clothing becomes too dear, we make the old item last longer. If labour is made to expensive, entrepreneurs and those in business in a small way who want to enlarge their work force by employing an extra man, an extra two men or an extra three men will be discouraged. We are looking to those employers to take on more men. However, they will be discouraged if the cost of the individual workman becomes too high.

The next few months will be extremely important, and I appeal to my trade union colleagues to be extremely careful in the way in which they conduct their negotiations. I say that as a life-long trade unionist and a union sponsored Member. If wage increases are allowed to rip and we experience 30 per cent. or 40 per cent. settlements and, in some instances, demands for 100 per cent. wage increases, that will help to enlarge the number of unemployed in my area, in the region and throughout the country. That is something that we should consider carefully as Socialists, as individuals who support the cause of planning.

If my trade union colleagues feel that they are starting on that road, they should take a step back and carefully consider whether the policies that they are pursuing are right, or whether they should get together again with a Government that is partially of their own creation to try to work out a policy that will benefit them- selves, their members and the nation, and alleviate unemployment in my constituency and in the Northern region.

If we are unable to control wage increases and if wage increases start to run away with us, those who pass judgment on us will be the housewives, They will have to face the results. They will start to say once again—this happened two or three years ago—that they cannot go into the local store without facing a price increase. If they are honest in their heart of hearts, as most of them are, they will accept that in the past 12 months there has been a stabilising of prices. There is no hue and cry about prices shooting up. Prices are partially controlled by the Price Commission. They have been partially controlled by the fall in inflation. We can now think of prices stabilising. That is making the lot of the housewife a great deal better.

Housewives will not forgive us if we return to the conditions of two or three years ago when every time they went into a shop they were faced with price increases. Housewives will be the judges. They are important. I remind my trade unionist colleagues that they represent an important electoral force. There is no doubt about that. They understand that it is no good having confetti money. They realise that what is important is what money will buy.

If we are defeated at the next Election, the view may be taken—I have heard it said on occasions—" We cannot do any worse under the Tories ". I have heard that flamboyant remark made by those who should know better. However, what would happen under the Tories?

Strange as it may seem, unemployment has something to do with public expenditure. Special measures have been taken in the Sunderland and Wearside area. For example, we have the temporary employment subsidy. The number of workers so involved is nearly 2,000. That is public expenditure.

When the hon. Member for Manchester, Withington (Mr. Silvester), who sits on the Opposition Front Bench, intervenes in the debate, as I am sure he will, I hope that he will explain in some detail whether employment measures will be subject to the public expenditure cuts that are repeatedly demanded in general terms by the Opposition. We have heard that defence, the police and various other sectors are to be exempted. Over the past few months we have managed to get that out of the Opposition. We have been told that there will be certain exemptions. However, I assume that such measures as the temporary employment subsidy, the work experience programme, the job creation programme, the youth employment subsidy, the recruitment subsidy for school leavers and job release schemes amounting to about 10,000 jobs in the Sunderland travel-to-work area will be part of the public expenditure cuts. I hope that when the hon. Gentleman intervenes he will tell us that that is not the policy of the Opposition.

If those measures are to be exempted, they will have to be added to the specific items that the Tories would not include in the general cliche that is always used by Opposition spokesmen when referring to public expenditure cuts.

Obviously the employment measures to which I have referred are directly allied to the reducing of unemployment. We realise that they are short-term measures. My right hon. Friend the Member for Sunderland, North went to great lengths to explain that we are far more interested in stable employment in the long term than with short-term but helpful palliatives in the meantime. However, we acknowledge that short-term measures are important.

The hon. Member for Manchester, Withington may enlarge on Conservative policy and explain his party's approach to grants to smaller firms, grants to major firms and grants for training. All that is public expenditure. I hope that we shall hear that those policies would not be part of the public expenditure cuts to be announced if the Tory Party formed the next Government. We do not want the introduction of a Conservative Government with a free-for-all approach. I hope that when the hon. Gentleman intervenes he will be able to placate my right hon. and hon. Friends and myself.

The hon. Member for Newcastle upon Tyne, North (Sir W. Elliott) suggested that we should do something for ourselves. He very kindly said that Sunderland has attempted to help itself and, indeed, that is so. I pay tribute to the local authorities of Sunderland and of Washington New Town for the tremendous job they have done in helping to alleviate the unemployment problems, and for the tremendous work they have done not only in trying to sell the area to incoming people and in trying to fill our empty advance factories but also generally in dealing with employment in the area.

To his credit, the chairman of the education committee of the council announced its intention—it is not asking—to take on more school teachers in the area in order to reduce the size of school classes. I hope that my right hon. Friend the Secretary of State for Education and Science will take that announcement in the spirit in which it is meant and not put any obstacles in the way, because it is important to the town and its educational future. It is a tribute to the courage of the local authority that it is prepared to do this, and if necessary to pay for it out of the money that is there.

In relation to recent attempts to bring new industry into the area, I was particularly saddened by the tale of the Hitachi approach. I mention this because it is important for all concerned in the region to appreciate the importance of inward investment, whether it is Japanese, German, American, or, indeed, from one of our home-based industries which wants to expand in the region. It is most important that such approaches should be investigated in some depth before people condemn them with off-the-cuff remarks of one kind and another. It is most important to make absolutely certain that we know the full facts before we say "No" or before obstacles are put in the way, whether in the matter of training, re-training, manning, organisation, where the industry should settle, what the management should be, the provision of houses for key personnel, and so on. These are all important factors in encouraging a new industry to come into the region. If only people would think a little, I am sure that it would be to their advantage. Perhaps it is our fault. I do not know whether that is so.

My hon. Friend the Member for Consett (Mr. Watkins) mentioned the document "Let's Pull Together". The Labour Party in the Northern region produced this document because we were worried about the accumulation of various bodies which were responsible for doing things about jobs, about expansion in education, and the like. It may well be that we are partially at fault when there are breakdowns in communications. But I earnestly ask all sides of industry, and all sides responsible for incoming industry when it comes into the area, to sit down and talk sensibly and collectively before any public remarks and debates take place through the news media, and so on.

People tend to get into entrenched positions. The Hitachi company stands among the top 10 companies in the world. It was interested in putting a complex into the region. It has now gone—and not only gone but gone with a black eye and bad feeling about the Northern region as a whole. This will be very difficult to get over. As it happened, this complex was concerned with television, but Hitachi deals with everything from lifts to caterpillar tracks to ships. Whatever one may care to name, Hitachi deals with it. If this Japanese company had wished to have a European complex and had settled in the Northern region, in our area in Washington New Town, in the Sunderland catchment area, it might well have been only the beginning of a number of other complexes from the same large company, with its eye on the very lucrative European market.

We lost that opportunity initially, I believe, because of some very ill-considered comments. A tremendous campaign was led by the present chairman of the Conservative Party, with his business hat on. From the point of view of my region, the result is an absolute disaster. I hope that when we are considering such matters in the future we shall get together and talk about them more sensibly. This is what is happening now in relation to the region's approach to the micro-electronics industry. The case put forward by Tyne-Wear and the case put forward by the economic development council for the region is a very strong one.

Sir William Elliott

I was rather surprised at the hon. Gentleman's comment about the chairman of the Conservative Party. I followed the attempt of the Japanese firm to come to the North-East. The fact that it did not come was much more due to the machinations of other television companies than to anything said by the chairman of the Conservative Party, who would, I feel, resent what the hon. Gentleman has said.

Mr. Bagier

I am not really attacking Lord Thorneycroft in a direct personal sense. I am merely drawing attention to his position in relation to the industry and the organisation which led the campaign against Hitachi settling in the area. If that is not damaging to the area, I do not know what is. Indeed, I understand that Hitachi will after all be coming to this country, and probably in partnership with one of the companies which so violently opposed the idea of Hitachi settling in the region in the first place. I cannot easily forgive Lord Thorneycroft and the industry for the action that was taken.

Before the hon. Gentleman intervened I was about to deal with the microelectronics industry. The Northern region's case is well orchestrated and is being put in a very intelligent way. Emphasis has been placed on the great advantages that we have with our university involvement in the Northern region. I say to my hon. Friend the Minister in the kindest possible way that the Northern region would find it very hard to take a negative answer, especially if it came from Government circles.

There are many Government-backed bodies which have not come into the region over the years, despite our efforts, but we feel that we are particularly suited to take the micro-electronics industry, with the large amount of skilled labour that we have. There are people who worked for Plessey, which closed down, and are accustomed to that type of industry. There is also, as I have already indicated, the involvement of the university. We would find it very difficult to accept any excuses which prevented the industry from coming into the region. If it does not come, I am sure that there will be a vast outcry from Labour Members who represent the Northern region. No doubt they will be assisted by Opposition Members who also represent the Northern region.

The burden of our case today has been to draw attention to the particular problems of Sunderland. I hope that my remarks have illustrated the effect that national pay policy can have on regions such as mine. I have appealed to our trade union colleagues nationally, right across the board, to consider that factor when they are talking about their pay policies. Lastly, we have tried to consider what best to do about the region as a whole. Mr. Holley, the general manager of Washington New Town, has said in a note to each of us that in an area an industrialist looks for the following factors: A supply of reliable labour with appropriate skills; good communications; an attractive environment in which to live, work and take recreation; prompt and efficient service. I suggest that on all those counts we stand equal to any area throughout the country.

12.48 p.m.

Mr. Ted Leadbitter (Hartlepool)

The significance of the title of the motion, Mr. Deputy Speaker, should not be overlooked. It is specifically about special measures to combat unemployment". Unemployment is a national problem, for there are over 2 million people registered as wholly unemployed. Those who think more deeply about these matters, and try to interpret what is meant by unemployment, would talk of a figure nearer to 2 million.

The significance of the debate to the nation is therefore paramount. So, where are the Liberal and Scottish National Party Members? There are major problems in Scotland. The absence of so many hon. Members is terrible for those of us who seek to share in dealing with the problem. It is no joy to any hon. Member to take party political advantage of the situation. Men or women who are out of work will not thank the House for wasting time by forgetting that their welfare is a priority as is their right to be employed.

Where are the Welsh nationalists? I do not know whether some of them think that the rural areas of Wales have no problems at all. I gained much of my political philosophy from Wales. I studied under Nye Bevan in Tredegar, in the Query Club. While I may have cultivated some annoying political excesses, I later learned in the House to modify them and to seek to be objective. In Wales there is a high level of unemployment. The Conservative Party has been represented throughout the debate. The hon. Member for Newcastle upon Tyne, North (Sir W. Elliott) has been here from the beginning, and each time he left a colleague came in to take his place. I say nothing of the Front Benches, because the Front Bench spokesmen will talk to each other later, I hope not in over-polite terms but in terms which cry- stallise the difference between the parties, for the benefit of the electorate, who will have to consider these matters in a few months' time.

The hon. Member for Newcastle upon Tyne, North justifiably mentioned his hopes for the return of a Conservative Government. I leave those larger questions—because I have enough problems in my own constituency—to the Front Benches. I shall be listening carefully this afternoon and carefully reading in the Official Report on Monday all the wonderful notes I see on the Front Bench, on which the Minister will base his speech. No doubt he is hoping that I shall finish my speech before 3 o'clock, because it will take him an hour to get through all that. I understand that the hon. Member on the Conservative Front Bench, the hon. Member for Manchester, Withington (Mr. Silvester) is also well prepared. But where are the splinter groups in the House, which have so much to say about the problem? Those who are looking to the House to debate this serious matter properly will condemn the degree of apathy that we see. I hope that the country will take note of it.

I have become an authority on industrial closures, while some people have become professional in achieving them. I have been astounded that in recent years some people have become professional in achieving closures and very good at it. I do not wish to make any imputations but whenever we produce a good, sound economic argument for keeping an industrial unit open we suddenly find ourselves being completely neutralised because some clever dick says "Let us talk about severance pay. Let us talk about redundancy pay. Let us wave the carrot so that the men will bite", and, lo and behold, the men do bite.

It is not without significance that we face not only the economic problem of unemployment but increasingly aggravated social problems. The stresses and strains are creating an upsurge in violence and vandalism, inside and outside the home. We are building more law courts and more houses for battered wives than ever. There is bound to be a correlation between the economic and social problems. It is not right to buy out good men, putting aside the economic argument for sustaining an industry, to tide it over for a while until markets improve. We can provide an easy way out for our people with a lump sum of money. They then have a time of less worry. It may be a time of excessive comforts never before enjoyed—albeit that much of that money goes to the bookie or the brewer—but when the honeymoon is over the stresses and strains in the home are increased. My hon. Friend the Minister and all those interested in human welfare should take note of those consequences of increasing unemployment and perhaps institute a special study of them.

I consider that to be a matter of great importance. That being so, I ask: Would the position have been better or worse without a Labour Government? By any reasoned test, whatever anybody says for party political or any other reasons, one must admit that if there had not been a Labour Government the economic and social situations that I have described would have been hypercritical. Some figures may help to illustrate what I mean.

Since 1974 12 different schemes have been introduced to deal with young people, people over the age of 19, middle-aged people and people approaching retirement. They were intended to cope with the great dilemma which arises from rapid technological change, when no human institution has yet found an answer to the problem of keeping men and women fully occupied in those areas where they want to be occupied. Between 1974 and last December the temporary employment subsidy produced a cumulative total of 453,361 jobs. The job creation programme produced 260,000.

The recruitment subsidy for school leavers is tremendously important. As an ex-school teacher I hope that every industrialist and social worker, every politician and every Government Department, with anything to do with the matter will understand the heartache, misery and sence of despair experienced by young people when they find after leaving school that the door to the adult world is not open to them.

I would go further. No boy or girl should be out of work on leaving school. The country is not so poor that it cannot afford to see that that does not happen, though we may have a certain administrative constipation, a subject to which I shall come later. There is no question but that the country stands condemned on this matter. It is no good its looking to other countries in the Western world for comparisons as a salve. There is no reason for school leavers to be out of work.

Up to the end of 1978 the recruitment subsidy for school leavers had produced 30,179 jobs since 1974. The work experience programme had produced 60,519. We should congratulate all the boys' voluntary organisations, the unsung people who, without headlines, give their time after their normal work to young boys and girls. Under our community industry scheme they placed another 4,765 young people in work. The figures for the job release scheme were 28,745.

I hope that the small firms' organisations will recognise that this is the only Government to produce, in the form of the small firms employment subsidy, a scheme to help small industries. Indeed, we are improving that scheme this year. It had already produced 8,587 new places. The job introduction scheme was responsible for 553 jobs, and the youth opportunities programme, which had only just got started, produced 35,000 new places for young people. The special temporary employment subsidy produced 300.

Is not the House glad to know that a total of 929,000 places was provided to keep our industries working? In addition, there are 100,000 training places in industry, plus 38,000 Training Services Agency courses for young people. Many of those are related to the youth opportunities programme.

In my thumbnail sketch, I have spoken of the period up to the beginning of this year. I shall be much briefer in dealing with the past year, in which the number of people covered in all those schemes, all created by a Labour Government, is 296,798. That is up to the last count at the end of October, or in some cases the middle of this month.

From April 1975 to 31st March 1978 the expenditure incurred on all those special measures was £560 million. In the current financial year alone the figure is £410 million, an indication of how we have increased the aid given through those programmes. There is further expenditure arising from the measures already earmarked for 1979 and 1980.

I repeat: should we have been better or worse off without a Labour Government? By the test of those figures, we should have been worse off, albeit that we have more to learn and albeit that to the knowledge of many hon. Members there have been some unfortunate decisions. For example, some young people have been wrongly placed and others have been found places when they should not, while still others who should have had places were neglected. However, there were bound to be some teething troubles.

We should take time to thank all those in government who have spent many long hours listening to me and my hon. Friends on this burning question. We should thank all those who administer the various forms of assistance, particularly those in the universities, the trade union movements, local government and the various voluntary organisations who give up their free time. Without their help, none of the schemes could function properly.

I have only one cautionary word. I hope that the Government will examine the growth and development of the Manpower Services Commission. If we are not careful, we shall have more people looking after the unemployed than we have unemployed. I do not mean that to be taken literally, nor do I mean to be critical of the commission when I say that we must beware of the growth of bureaucracy. But it is always the job of politicians to put down a cautionary marker for those who have a natural tendency to prove the truth of Parkinson's law. We know how a new office can be created, and then a new secretary, a new typist and a new filing clerk are wanted. It is possible that the commission is spreading far more rapidly than it should. It should be made to concentrate upon the real problems and not miss out on the opportunities that can exist in a situation of which we in the Northern region are fully aware. The organisation should not become too unwieldy.

I have given an outline of the basic problems and of the benefits that have come from the Labour Government. I have spoken about the presence, or otherwise, of hon. Members at this debate and of our work and that of our ministerial colleagues. To those who read the Official Report of our debate on Monday, I must suggest that the Conservative Party should oblige the nation by telling it that it will not destroy the infrastructure that has been built up to deal with the problem, until we have overcome the major difficulty of coping with rapid technological change through shifts of manpower and resources.

The Conservatives must not "come it" about cutting public expenditure. They must not say that all problems will be solved by reducing taxes. I should like to see tax reductions. That is a natural, understandable and supportable desire, but taxes must not be cut at the expense of the true welfare of the nation as a whole.

So far I have been talking about those kinds of approaches to our national problem that are in the main related to the need to support private industry. But there is also a nationalised sector. If people talk too glibly about cutting public expenditure, I ask "What in God's name is the sense of having patients going to hospitals if nurses cannot get there? What is the sense of tolerating our having large numbers of people who need kidney machines and who are dying because they cannot obtain the machines or the skilled operators to work them?"

The total cost of training nurses includes the cost of education, because a person cannot now be considered for training as a nurse unless he or she has four 0-levels, in some authorities' areas, or seven O-levels in many other areas. Nurses are highly skilled professionals. The total educational and training cost for nurses to be out of work is criminal. I repeat, the country is not so poor that it cannot afford to keep our hospitals fully staffed.

I hope that the Secretary of State for Social Services will shake his civil servants off his back—they have been a burden too long—and do what the country wants done. We want the hospital service—the great pillar of the Labour movement, the thing for which we fought to create a new climate in our land. Therefore, my right hon. Friend must shake those civil servants off his back.

I should like to illustrate what I mean, because I never talk without facts. The St. Hilda's Hospital in Hartlepool needs a middle grade appointment. People have been working many hours a week looking after the emergency and accident department. Indeed, on one occasion they were so tired, the hospital had to be closed for about 10 days. The Minister agreed with the argument put forward by my hon. Friend the Member for Easington (Mr. Dormand) and me about the need for that appointment. The community health council, the hospital management team, the area health authority board and the regional health authority manpower committee agreed to it. But what happened? The telephone bells began to tinkle and a representative from Newcastle—I am going to get after him whether he likes it or not—tripped down to London and said "I support the medical profession's case that, for its reasons, an appointment should not be made".

That is what I mean by the Secretary of State getting his civil servants off his back. Put them aside. The electorate and Parliament put the Secretary of State in office to listen to us, not to kowtow to a Department which has a long reputation for being secretive and, indeed, indifferent in many instances to the great damage that has been done to the National Health Service. Despite that inbuilt braking system, this Government have poured a great deal of money into the Service. Indeed, there is more money going into the Service than ever before. We are talking not about resources but about attitudes. In other words, if we lift that example into the problem of unemployment, we are talking not about lack of resources but about attitudes.

I turn now to the attitude which has been developed to cultivating the idea that there are good economic arguments to support the reasons why we have unemployment. I have been amazed over the past few years at the development of this thesis. At one time we would talk about full employment and mean it. Now we talk about the reasons why we have unemployment. It is an interesting shift of attitude.

Earlier, I alluded to the growth of the Manpower Services Commission. One of the reasons for the shift in attitude is the mountain of reports which has been built up. If anyone in my constituency wants to spend a long summer holiday being bored to tears, all he has to do is to read all the reports which have been pro- duced by those who are on the list of the good and great.

Mr. Ernest G. Perry

You must be joking, Ted.

Mr. Leadbitter

I refer to those who become chairmen of economic planning boards and councils—the quangos. This is a particular quango. There is also the report of the North-East Development Council. If we are not careful— I am sure that the hon. Member for Newcastle upon Tyne, North will not disagree—the new organisation called NECCA—the North of England County Councils Association —will get off the ground. We had a bright quartet there. This matter has not been mentioned, but the hon. Member for Newcastle upon Tyne, North justifiably alluded to this dilemma. The Government give the North-East Development Council a large amount of money to help it to attract industry. It is our job to see that the officers do their job and if anything goes wrong it is for us to put it right.

What happened? The four leaders of the councils in the North said "We want our thumbs in the pie." Therefore, the four of them involved themselves with NECCA. They were so brilliant they could not even decide who should be chairman. There was no question of considering who had the brightest ideas and was the best man for the job; they simply put the names into a hat. Frankly, that is part of the dilemma and attitude.

Sir William Elliott

I have been listening carefully to the hon. Gentleman. Indeed, I indicated that when we translated from NEDO to NEDC it was with the idea of the greater involvement of local government. The hon. Gentleman is right in saying that the North-East Development Council receives a substantial Exchequer grant. However, it is also strongly supported by local authorities. Therefore, I consider that the four chairmen led so ably by Lord Ridley, the one Conservative, whose announcement this week of retiring from the Northumberland county council I regret, are in order in saying that they wish to have more accountability. That is what the hon. Gentleman often asks for in a general sense with regard to the NEDC.

Mr. Leadbitter

I am glad that the hon. Gentleman has revealed the name of the man whose name was pulled out of the hat—Lord Ridley. However, I do not want to be personal. By any proper constitutional behaviour, the North-East Development Council has an executive and delegates who represent industry, the trade union movement and local authorities. Therefore, if we are to attract new industries, it is vital that we should not have some kind of kangeroo court above the organisation supported by the local authorities and the Government. We should put our own house in order if there is any problem. I suggest that that brilliant quartet have been a total embarrassment, and the sooner they go the better. I have always thought that becoming the leader of a council was not necessarily the best criterion for doing anything at all but sitting back and listening.

Making reports has become a disease. There is another one, "The Regional Development Programme" from the report on the European Regional Development Fund UK 1978–80. I have taken pains to read it, as have others who have a common interest in this matter about which there is no division between both sides of the House. The report deals with transport, agriculture and communications. It says the same things as we have been saying over past years—nothing more, nothing less. It has been able to do that because of another report. The report devotes about 12 lines to the whole of those three great problems. It then goes on to the subjects of coal, metal, shipbuilding, chemical works and gross domestic product. All that is done in about 30 lines, but there are 70 pages in this report.

Then, to and behold, we turn the page and find, under the sub-heading "Development Measures:" An independent research team has recently completed a specially commissioned strategy report. How many strategy reports have we had? Does the House remember the disgraceful political gimmick of the task teams, so-called, which reported to no one but were in the secret enclaves of Whitehall? No hon. Member could look at their reports, which were made by civil servants who were supposed to be busy in their own Departments. They came to Hartlepool on several occasions and spent more time taking tea and bis- cuits than doing real work. Those task teams were a political gimmick, and I am angry about political gimmicks.

Parliament should press the Government to issue an order to all these clever people who have had some sort of general training in some social studies about industrial psychology and all that sort of stuff, "Do not print any more reports." We are not here to promote increased employment in the printing industry. We are here to ask simple questions.

For instance, whatever is happening elsewhere in the world, in the United Kingdom good, strong arguments are made for closing steel production capacity, for closing shipbuilding yards, for closing textile plants—more than 4,000 jobs in the textile industry have been lost in the region in the past four years—indeed, for an abundance of closures for reasons which are quite incomprehensible.

Like my hon. Friend the Member for Consett (Mr. Watkins), there is a remarkable situation in the steel industry in my area. This story will, I am sure, appeal to everyone—except my people who are out of work. There is a medium-sized steel plant in Hartlepool. It was viable; it was making a profit. It manufactured its first steel in 1960. About £70 million worth of development went into it and it possesses now a capital value of £250 million. It therefore seems crazy that someone should say "Shut it down." Never mind about the nation having paid for it. There are no real planners in the British Steel Corporation at 33 Grosvenor Place they are busy fighting among themselves. But it was the British taxpayers who found hundreds of millions of pounds for British Steel.

My people had the severance carrot dangled before them, and 1,400 lost their jobs at the beginning of the year. There is another 1,400 to come. I have nearly 14 per cent. out of work. If there are more closures in the shipbuilding industry at Naverton Hill, I will have 500 more men out of work. I will then be talking about 20 per cent. unemployment.

But what about this interesting small steel plant in Hartlepool? There is a port in Hartlepool. Ships are coming in and unloading steel there. I can walk across my constituency in 10 minutes. It it a beautiful constituency. But I had better not take time to talk about that aspect. I will merely say that it is a marvellous constituency. I will tell the House what is being done about these steel imports. Because I am vigilant and like to see what is going on, I noted that the Japanese metallic tags were taken off the steel plates on the last ship that came in. Everyone thought that I would not find out where the steel had gone. But I can tell it is lying in Spion Kop, in my constituency, under lock and key.

Thus, my steel men are out of work and the country has paid severance pay to them to stay out of work. Many of these marvellous steel makers will never work again. Some of them could well have been down at the docks watching this Japanese steel coming into their town. Is not that damn stupid? One would have to be basically an idiot to contrive a situation like that. I have taken the precaution of talking to people who work in the steel industry, not just the union officials, whose opinion I place very high, but good, sound middle management. They say that that steel could have been produced in Hartlepool. Lest I be interpreted as being against the large steel complex at Redcar, let me make it clear that I support it, as we in the Northern group all do. We want it to grow. But large steel complexes cannot push through small but substantial jobbing lots of steel. Only medium sized plants can do that.

Therefore, we have the remarkable situation that my steel workers and others are out of work in the United Kingdom. What is the arithmetic? First, there are 30 million tons of steel plant capacity in the United Kingdom; secondly, there is a requirement for our domestic market of only 15 million tons; thirdly, imports of steel are coming into the country and on to the domestic market; fourthly, the British Steel Corporation is therefore losing a share of its own domestic market; fifthly, because the corporation is relying on huge plants we are not getting the versatility and flexibility by which we could exploit the domestic market finally, but even more important, everyone is standing aside and saying "But look at the rest of the world—we are in a depression."

From Steel News this morning I find that the British Steel Corporation is at last accepting that the position in the rest of the world is normal. The long years of the market conditions in the world are now being described as normal. We are to produce another 5½ million tons of steel plant capacity. The situation will get worse.

It is a condemnation of those who plan at BSC headquarters that, on the backs of hundreds of millions of pounds of the taxpayers' money, they have contrived to have an inflexible steel industry and have deprived the nation of the versatility which comes from having medium-sized plants as well as large plants so that they can meet the growing demand, should it come, not only of large orders but of smaller ones. The more suitable feedstock of the large number of medium-sized companies, corporations and public utilities in this country which can produce demands for 3,000 or 4,000 tons of steel —useful jobbing lots—could have their demands met by medium-sized plants.

So, at great expense, with men laid off work on severance or redundancy pay, we have learnt the grave lesson that it costs more to keep men idle than it does to keep them in work. If no one belives me. let him work it out. If I am proved wrong, we are still left with the question of what is the economic sense of putting skilled steel workers out of work.

Shipbuilding, a related industry, had to be helped under the Shipbuilding Industry Act 1967. Millions of pounds have been poured into it. Earlier today I referred to Haverton Hill. Some years ago, that yard was supposed to close. At the time, Charlie Clore owned Haverton Hill. He was good at selling shoes, but he was not a bit of good at selling ships because he did not have a marketing office. His company treasurer came to the House and enlightened some of us about how to look at accounts and so on, and we were persuaded that there were no orders and that the yard would have to close. The Secretary of State at the time invited hon. Members representing Teesside constituencies to read a certain document on the subject. I threatened to resign my seat if Haverton Hill was closed. So a deal was done. Swan Hunter got Haverton Hill for £1 million. It was a good buy. It could not have got a better one.

Mr. T. W. Urwin (Houghton-leSpring)

There are other facts surrounding the Clore enterprise, if it can be so described, at Haverton Hill which I am sure have not escaped my hon. Friend's memory—I know how wonderfully retentive it is. He will recall that, in addition to his own valiant efforts to retain Haverton Hill shipyard after the Clore failure, there was a considerable amount of assistance by members of the Northern group of Labour Members acting in their concerted official capacity.

Mr. Leadbitter

That is what I call a timely intervention. My hon. Friend the Member for Houghton-le-Spring (Mr. Urwin) was closely involved with this and other problems in the Northern region, and not just as a Member of Parliament. My right hon. Friend the Member for Sunderland, North (Mr. Willey) spoke of the need for a Minister for the North. It is significant that my hon. Friend the Member for Houghton-le-Spring is not only the representative of an important constituency but at one time was a Minister for the North who had a tremendous amount of success in his impact on the North. He is right to stress that it was the Northern group of Labour Members who contributed largely to the yard being kept open. But we are having the same story now.

Mr. Willey

I have no doubt that my hon. Friend also remembers that we had 350 Sunderland shipyard workers working on the Tees.

Mr. Leadbitter

Yes, and that is why we are all here. Many of our interests overlap. Many of my constituents work in Sunderland, and there are Sunderland dock workers and people with related skills working in Haverton Hill. There is no hon. Member in the Northern group who has not an inter-related active interest in the matters that we are raising today.

I realise that I am speaking at length. However, we have the great privilege, for once in this House, of having some room for manoeuvre, and I have received a wink and a nod from my hon. Friend on the Treasury Bench. Incidentally, hon. Members will have noticed how Ministers are able to leave the Chamber to refresh themselves. An hon. Member with whom I worked in the past has now taken his place on the Treasury Bench to show an interest and hold the fort for his colleagues, even though he does not belong to my area. It is an example which is not emulated by the SNP, Plaid Cymru and the Ulster Unionists. The Opposition must not think that the situation will improve for them, because there will be no succour or nourishment for them when we increase the number of Ulster seats. However, let us, without sparing more than a passing thought for absent friends, pursue the dialogue on this important subejct.

The shipbuilding industry is of vital importance. My right hon. Friend the Member for Sunderland, North mentioned a scrap and build policy. There may be some thoughts about taking coals to Newcastle and about whether it is economically right to sustain an industry by taking in someone else's washing. However, I would rather keep men occupied doing things than keep them idle not doing things. As I said earlier, it is most expensive to keep men not doing things.

We have heard about the lack of certain skills in the North. But we have underlined that with the convictions from experience that people in the North—and I do not wish to detract from the qualities of people in other areas because Britishers are like this—are adaptable and capable of learning news skills. But when we consider the problem of teaching new skills, we discover how difficult it is to do. Again, it is expensive.

I have given an account of the 926,000 jobs which have been created since 1974. Under some of the schemes, each job place cost more than £1,000. In others, each one cost no less than £600. So, if I have a shipbuilder or a steel worker, I want to examine first whether in the long term it is advantageous to keep those industries in such a way that they will be in a fit and competitive condition to meet any upturn in our markets.

The problem must be examined in this way simply because we are aware that the financing of the shipbuilding industry in Japan—when I was there I spent a lot of time studying this aspect—is not the same as it is in this country. The same applies to the steel industry in Japan. Some of the manpower costs which we record in our steel industry are not to be seen anywhere in the general infrastructure of the industry in Japan. On the other hand, we have to bear in mind that in Europe we have the Common Market where people seem to spend most of their time sitting on their backsides playing up to the Treaty of Rome. There are some rascals in the Common Market. Germany looks after itself very well.

Let us consider shipping. Ships sail on water, and water comes into ports. But what happens in Europe with ports and water? Apart from the fact that the Common Market gives us directives about how to keep our water clean, which I think is an impertinence, the fact is that European ports are so heavily subsidised that they can attract shipping at a time when the Port of London Authority faces bankruptcy. However, these are interrelated patterns about the commanding heights of the economy—shipbuilding, the steel industry and so on.

Let me remind the House that this year Great Britain's net contribution to the Common Market was £1,000 million. Our trading deficit with the Common Market was £3,000 million. Our receipts from the Common Market were about £500 million. Other contributions by us to the Common Market were about £800 million. Therefore, when we talk about shipbuilding and steel—in other words, about investment—it is interesting that for every pound which comes into this country from the Common Market for investment, £8 goes out to the Common Market.

There is no argument about those facts. They were raised in the House the other day in our debate on Common Market development. They were not challenged then, and I am sure that they cannot be challenged now. All sorts of ideas for special measures have been presented. Our first attack on this question must be to examine whether we are using our resources in the most suitable way for our industry.

I am convinced that there is some bad decision making. For example, a company in the North producing refrigerators entered into a development programme. It received a large amount of money from the steel industry and the Government. Now, with 36 months of the project still to run, it has closed. A £3 million project is finished. The men have been paid off, as usual, with about £150 severance pay. In view of the level of refrigerator imports, I arrive at a contrary conclusion about the reasons for the closure. Imports have been cut by half since last year. The reason given for the closure was not valid.

I would certainly support, as a special measure, the appointment of a Minister for the North. It is no good saying that if we wanted one Merseyside and Wales would want one. It is important that the voices of all in the regional areas should be heard in the Cabinet so that the proper claims of the regions can always be upheld.

It is important that we should get right decision making about development. There is nothing better than what I would call—my right hon. Friend the Member for Sunderland, North has also referred to this—an entrepreneurial situation in which decision making, based on other than Whitehall calculations, can become predominant. Entrepreneurial judgment is far more sound than all the shifting criteria that have to be analysed on a purely Civil Service calculation.

The seed corn of human activity must not be neglected. Money must be put into the social services, hospitals and education. There has been an increase in the number of teachers in the past year, but more than 20,000 teachers are out of work when there is still a teacher-pupil ratio problem. We spend large amounts of money training teachers. It is a waste of public expenditure to stop them using skills to the great advantage of our children.

There ought to be a university on Teesside. When I became a Member of the House, my hon. Friend the Member for Houghton-le-Spring and other colleagues and I were satisfied that within a short time plans for a university would be drawn up.

We should stop the slap-happy nonsense of preparing reports and instead press for public expenditure, which is the very foundation of economic development. Let us pursue entrepreneurial decision making and take as much authority as is reasonable away from Whitehall in order that the generosity of the Government, in terms of financial support, can be decided in the regions, where it matters most, against a background of industrial inquiries and applications.

Certainly there has to be selective aid so that once we detect, in parts of the economy in the Northern region, a situation in which immediate support must be given, provided it can be seen to be justified, the decision to help will not be delayed because of lack of resources. In that sense, the Northern region has suffered enough. Over the years, many of us have heard the same story about solutions, read the same reports under different titles and sometimes different chairmen's names.

There is no lack of resources to deal with our problem. The question is whether we have the guts and the will to change attitudes so that those resources may be utilised for purposes which, generally and publicly, are acceptable and about which there is a consensus.

1.45 p.m.

Mr. Ernest G. Perry (Battersea, South)

I heard my hon. Friend the Member for Hartlepool (Mr. Leadbitter) say that the Northern region has suffered enough. As a mere Londoner, I have suffered nearly three hours talk today about the Northern region as though it were the only region in the country that suffers from unemployment. But there are many other regions which also suffer.

I express my thanks to my right hon. Friend the Member for Sunderland, North (Mr. Willey) for bringing forward this motion. He refers to other regions that suffer in the same way as the North.

One of the problems is that many regions are suffering from the decline of their basic industries. This has been going on for a considerable number of years. I want to deal especially with inner London. People talk about the problems of unemployment in many parts of the country, but those problems are nothing like what they were in the 1920s and the 1930s. In those days, people could be out of work for 12 to 15 years. After they had been out of work for two or three years, no employer would look at them and they themselves were so demoralised they were not fit to apply for work. In the 1930s, this was the problem that faced literally hundreds of thousands of people who were unemployed for five, 10 years or more. This is the problem that we want to avoid these days. Now that we have reached the 1970s and nearly the 1980s, we have not the same problems to the same degree as in the 1920s and the 1930s, but it is a scourge that we have somehow to eradicate.

In inner London, we have many organisations—the trades councils, the London Labour Party, even the Tory Party, and the London Chamber of Commerce and Industry, which are particularly interested in the fall in employment. The proportion of people unemployed in inner London is as high as in many parts of the country. I would like to give figures so that hon. Members from the North, Merseyside and Scotland realise the prob. lems that exist. In October, this year, Poplar had a male unemployment rate of 13.7 per cent., Deptford 12.5 per cent., one in eight out of work, Stepney l2.5per cent., Holloway 10 per cent., and Canning Town over 8 per cent. This shows that we have regions in inner London that are suffering just as badly from unemployment as other regions.

Mr. Urwin

I am sure that my colleagues representing Northern constituencies, like myself, are fully appreciative of the justifiable point my hon. Friend makes. He represents a very tenable argument. Does he accept, however, that the unemployment problems of the London area are fairly recent compared with those with which we have been confronted, which are more or less a perennial problem and have existed for many years. Even when the national economy is at its most buoyant the Northern region has scarcely ever had less than two and a half times the national average of unemployed. Despite London's manifest problems, we still have, as my right hon. Friend the Member for Sunderland, North (Mr. Willey) pointed out, the intolerable burden of the highest unemployment rate in the United Kingdom.

Mr. Perry

I do not wish for one moment to belittle the evidence that my hon. Friend presents. We realise the truth of it. But the fact that the North has suffered in this way for so long does not mean that we should forget other areas that are now moving into that state of affairs. The same problem confronts inner London as confronts many other regions. For many years light and heavy industry have departed from the capital to Wales, the Midlands, the North-East and elsewhere. More than 500,000 jobs were lost to London between 1965 and 1975 as a result of the departure or closure of firms. Since the end of the war there has been a deliberate campaign to transfer employment away from London in order to secure a national balance. I do not oppose that. I am against over-centralisation of office jobs, the Civil Service, and so on in London. However, London has now reached the point where it is suffering, too.

Much worse, London faces the difficulty of much greater youth unemployment than other regions. Large numbers of coloured youths leave school at 16 without a job to go to. The proportion of coloured youths to the indigenous population has greatly increased, and I appeal to my hon. Friend the Under-Secretary to take note of what bodies such as the London trades councils, the London chambers of commerce and others say in drawing to the attention of Ministers the plight of the capital.

I am sure that my hon. Friend is aware of what is happening in places such as Southall, Brixton, Lewisham and other parts of inner London which have a large coloured population with a high proportion of coloured boys and girls reaching the age of 16 and unable to find work.

We are faced, then, with an unemployment and a social problem. One of the reasons for increased vandalism and crime in South London is that coloured and white youths are finding it difficult to secure suitable jobs. I do not wish to condemn the education system, but it must be borne in mind that many boys and girls are leaving school ignorant of the industrial world into which they are moving. It is about time we spent more money trying to create skilful and useful occupations for children so that they may be educated to play a full part in modern society.

People in London are beginning to realise the extent of the problem of finding work for the unemployed. Unless circumstances change, London will be in the same position as the North. It therefore should be given the opportunities that are made available to the regions to advertise what it can offer by way of the vast resources that would be available if they were properly developed.

My right hon. Friend the Member for Sunderland, North referred to the dock- lands. London has hundreds of acres of derelict dockland. Hon. Members would do well to take a trip down the river from Vauxhall bridge to Wandsworth bridge and then on to Wandsworth town hall. They will see on the south side a stretch of London that is practically void of industry. Before the last war it was a hive of activity with factories, a gas works and power stations. Now even the biggest power station in London—that at Battersea—is under threat of closure because it was built 40 years ago and is now out of date.

It is only during the past five years that one of the biggest employers in South London—Morgan Crucible—one of the largest firms of its sort in the world, was transferred from Battersea to Swansea. It took with it thousands of industrial jobs. I have seen large companies such as Projectile Engineering move out of London. Companies such as Dorman Long, May and Baker, and many others, have also gone.

I see that my hon. Friend the Under-Secretary is talking to my hon. Friend the Member for Tooting (Mr. Cox). My hon. Friend the Member for Tooting is well aware of the problems of unemployment in London.

Let me here pay a compliment to the organisations that are trying to bring this state of affairs to the attention of the Government. I refer to the chambers of commerce and the trades councils.

I fully realise that the North faces great problems, but if we are not to duplicate those problems in London we must understand that all regions are interdependent and that the problems of any one will be solved only if we solve the problems of them all.

1.58 p.m.

Mr. T. W. Urwin (Houghtonle Spring)

I wish to echo the tributes paid by my hon. Friends to my right hon. Friend the Member for Sunderland, North (Mr. Willey) for having succeeded in the Ballot and initiating the debate.

For many years my right hon. Friend, as Member for Sunderland, North, has been one of the greatest champions in fighting Sunderland's problems and seeking to resolve the domestic difficulties which have for so long faced the town. It is not surprising that the debate should have ranged much wider than was expected by my hon. Friend the Under-Secretary who said a short whole ago that he understood that it was about unemployment. We cannot discuss unemployment without talking about the remedial measures needed to overcome the tremendous problem that confronts the Northern region.

I hope that we are coming to the end of what I have often described as the new industrial revolution. The industrial revolution of the 19th century provided new jobs, and industry in this country began to make a name for itself. By comparison, the present phase of this second industrial revolution has denuded the old industrial areas of a massive number of jobs.

This is symptomatic of the developments that began at the end of the Second World War, and gained momentum throughout the 1950s with the tremendous job losses in British Rail. It climaxed with the major recession in the coal mining industry in the 1960s. More recently we have had the reorganisation of the steel industry, to which my hon. Friend the Member for Hartlepool (Mr. Leadbitter) referred, and this has resulted in a further reduction in employment opportunities.

The worsening employment situation has been accentuated by the decline in world shipping requirements since the beginning of the oil crisis. The shipbuilding industry in this country has faced fierce and successful competition from the Japanese, and the even newer fast-developing industrial nations in the Far East. I look forward to the early presentation of the corporate plan for the shipbuilding industry.

I wish to link myself with my right hon. and hon. Friends who have drawn attention to the alarming compendium of very difficult factors, every one of which is applicable to the Northern region, which have contributed to enormous job losses in Northern region constituencies.

The hon. Member my hon. Friend the Member for Hartlepool referred to the form of professionalism—certainly expertise—being gained by hon. Members representing Northern constituencies who have become expert in factory and other closures. I represent a mainly mining constituency, part of which lies in the administrative area of the Sunderland borough council. Very few people could be more expert at closures, particularly pit closures, than I was in the long and seemingly unending period of the 1960s, when almost every week a new pit closure was announced.

Coal was the basis around which the economies of so many communities in the Northern region revolved. A pit closure was a body blow to a community of 15,000 in which probably 50 per cent. of the men worked in the coal mining industry. That industry was the very lifeline of the people.

The problem of loss of jobs is closely allied with the absolute necessity for people to migrate from this area, depriving it of the more virile and younger people. This leaves those communities sadly depleted economically, and also depleted of young people who must leave to find other employment opportunities in other areas—probably in London.

While I have every sympathy with my hon. Friend the Member for Battersea, South (Mr. Perry) who spoke of London's problems, I must point out that the problems of the Northern region are far more endemic and of longer duration than those that are now sadly appearing in London. That is all part of the economic decline that this country and other industrial nations are experiencing. Therefore, I join with my right hon. Friend the Member for Sunderland, North in the renewal of his efforts to bring the Government's attention to the sad plight in which we, in the Northern region, find ourselves. We are continually at the top of the league table of unemployment.

I referred earlier to the fact that for as many years as I can remember—and that is now a great many—even when the national economy is most buoyant the unemployment figures in the Northern region are never less than two and a half times the national average. The problem has not defied solution entirely because we have always regarded the diversification from our major basic industries as being at the forefront of our requirements and our demands.

It is true that a fair measure of success has been achieved by successive Governments since 1964. With respect to the hon. Member for Newcastle upon Tyne, North (Sir W. Elliott), who is a regular attender at debates on the Northern region, however infrequent they may be, I believe that the Labour Government can claim more success in regional policy and in the creation of new jobs pro rata than the Conservative Government of 1970–74.

My hon. Friend the Member for Sunderland, South (Mr. Bagier) tried to look forward to the possibility, however remote, of the next Government in this House being Conservative. If that arose, the least I would expect from a Secretary of State for Industry from the Conservative Party would be not to repeat the mistakes of the first Secretary of State for Industry in the Conservative Government of June 1970, when industrialists up and down the country were increasingly impatient about lack of activity in industrial investment and investment grants which were always a major part of regional development policy.

The then Secretary of State—and I am sorry that he is sick and has had to resign his seat—apparently had no idea of industrial policy, despite the abundance of bad advice he received from some of his colleagues, including the right hon. Member for Leeds, North-East (Sir K. Joseph).

Sir William Elliott

I am grateful to the hon. Member for Houghton-leSpring (Mr. Urwin) for saying that I always attend debates on the Northern region. I try to do so. He talks about the greater success of the Labour Government on regional policy. I do not know the exact figures of regional unemployment, but it is an established fact that national unemployment has exactly doubled since the Conservative Government left office in l971.

Mr. Urwin

That claim is frequently made by the Opposition. It has nothing whatever to do with regional policy. The hon. Member knows as well as I what really led to the present high unemployment. The situation is beyond and out-with the control of the Government.

Mr. Leadbitter

I hope that my hon. Friend will bear in mind that one of the contributory factors was the 1973 oil crisis. There is no disagreement about that. The Western world has not yet recovered from that.

Mr. Urwin

I am grateful to my hon. Friend, but I have already referred to the problems that were caused by the oil crisis.

I am not criticising the Conservative Government for departing from the stick and carrot policy of industrial incentives to those who wished to settle or resettle in development areas.

Understandably there has been criticism of organisations such as the North-East Development Council for not being entirely successful in persuading industry to go to the Northern region. In the face of intense competition it is understandable that there is so little, and apparently a decreasing amount of footloose industry which wishes to change its location and move to the development areas.

The incentives policy has been reasonably successful. It has always been an essential part of my Government's policy to channel resources to the under developed areas. I say to my hon. Friend the Member for Battersea, South that we are having less success in attracting new industry to the regions. This is due in part to the Government's relaxation of industrial development certificate policy. Those certificates are now more loosely allocated than they were between 1964 and 1970.

The allocation of office development permits has also been relaxed because of the measures introduced by the Secretary of State for the Environment. Every morning and evening on the underground I see the posters which are as high as the tube station. They advertise the advantages of locating new offices in London.

I am sure that my hon. Friend the Member for Battersea, South appreciates that when industrialists and others take advantage of such opportunities they prevent a similar settlement in a development area. The construction industry is denied employment opportunities because industry goes to London rather than to the North-East or Merseyside.

London has a distinct advantage because of my Government's more liberal attitude to these policies. That attitude is indicative of the Government's anxiety about the developing employment situation in London.

Mr. Ernest Perry

About three or four years ago the footage for IDCs was increased by my hon. Friend the Member for Liverpool, Walton (Mr. Heller), when he was Minister, from 5,000 to 10,000. The LOB policy changed overnight because it was realised that the circle had been completed. It was realised that too many industries were moving out of London and that it was necessary to encourage them to come back. Many Government organisations vie with one another and tell people to do different things. I do not know where it will end unless there is some cohesion.

Mr. Urwin

I agreed with my hon. Friend's earlier submission. The situation in indicative of the concern expressed by all London Members who have persuaded Ministers, especially the Secretary of State for the Environment, to change the policy for allocating office permits.

My right hon. Friend the Member for Sunderland, North suggested that there should be a Minister for the North and a Northern development agency. Those were his two main suggestions for the region.

Hon. Members who represent Northern constituencies have for many years advocated the establishment of a Northern development agency. Before he was a Minister, my hon. Friend the Member for Gateshead, West (Mr. Horam) introduced a Private Member's Bill, the purpose of which was to set up a development agency in the Northern region. Unfortunately, that Bill had the support of neither the House nor the Government. It was considered to be counterproductive to the development agencies that were about to be set up for Scotland and Wales.

My views about devolution are well known. I have described the Government's proposals as being, tantamount to constitutional vandalism. I still firmly believe that the constitutional aspects of devolution outweigh the other factors such as the establishment of development agencies for Scotland and Wales.

For long we in the Northern region have recognised that Scottish and Welsh Members have a distinct advantage over Members from other development areas. We do not begrudge them that. They have their own Question Time in the House and their own Secretaries of State in the Cabinet. We are perhaps the most deprived of the development areas when one considers the unemployment rate. It is morally wrong that this situation should continue. On some occasions those activities are to the benefit of Scotland and Wales, but they are sometimes to the definite disadvantage of other development areas—not least the Northern region.

It may be argued that if we are successful in our bid for a development agency, other areas may wish to follow suit. However, I do not believe that that will happen. A long campaign has been waged by Members who represent the Northern region. I hope that the Government, however late in the day in terms of a decision, will pay great attention to the requirements of our area and the demands expressed in this debate for a development agency for the Northern region.

Our plea is underlined because of the very existence of the National Enterprise Board. When that body was set up, the establishment of regional offices in Newcastle and Liverpool was intended to be a concession because of the absence of development agencies in those areas. I am sad to say that I am not particularly enthusiastic about the benefits which have so far accrued to the Northern region because of the activities of the NEB.

My hon. Friend the Member for Sunderland, South referred to the loss of more than 2,000 jobs in telecommunications in the Plessey firm in Sunderland, and there has been a similar loss of jobs in that industry in Liverpool. We were led to believe that the NEB would readily seek to support the Hitachi project. That would have brought new jobs in a similar area of activity to that dealt with at the Plessey concern, and no doubt would have attracted other ancillary activities to the area. However, that assistance was not forthcoming.

The National Enterprise Board has a golden opportunity—an opportunity which may never be repeated—to assert its influence and justify its existence in the Northern region by ensuring that the silicon chip project comes to the North. I am aware of the competing demands from other regions to capture this golden project which will provide 4,000 jobs, with spin-off activities in supporting industries. I believe that the claim of the North-East for this work is more deserving than that put forward by other regions. The Tyne and Wear county council is to be applauded for the amount of investment it has put into the establishment of a research organisation based on the university. That move has the full-hearted support of everybody in the Northern region, and certainly Members of Parliament. I hope that the campaign will meet with success.

I am grateful to my right hon. Friend the Member for Sunderland, North for reminding us of the report in 1963 which recommended a university of technology on Teesside. That proposal received a great deal of attention by the Government in the period 1968 to 1970. I shall not rehearse all the reasons that were given for the refusal to proceed with that project, but I believe that if that project had gone ahead it would have been in operation a long time ago and would now be playing a major role in this new and existing area of technology. It would have considerably reinforced the claim for this project to be located in the North East.

I noted with regret the report in The Guardian on 8th November this year that the IBM United Kingdom scientific centre in the new town of Peterlee in the county of Durham is to be withdrawn. I wonder whether this is yet another pawn in the game which will influence the decision about where the silicon chip project will be sited. I understand that the IBM centre has gone from Peterlee to Winchester. I do not know the geographical significance of such a move. Peterlee, which has been built up as a centre for a science city, along with the development of the new town, has now lost the opportunity to be a scientific centre.

Mr. Leadbitter

The House might like to know that in Geneva recently I visited a number of IBM establishments. Since Peterlee was a focal point in the planning concept, and since some of the criteria involved population movements and industrial changes, the Government should remember that there are in the area the excellent universities of Durham and Newcastle. Perhaps we will be given some idea by the Government why that project has gone from Peterlee. That move may have something to do with INMOS.

Mr. Urwin

I am grateful for this intervention. The IBM project went to Peterlee because it was felt that a new university of technology was to be built in the area. Peterlee is but a short journey down the A19 into the area of Teesside where the university would have been situated. However, there is still no university of high technology in the area, and I was merely emphasising that both Durham and Newcastle universities are not far from Peterlee. Therefore, there is no valid argument against the idea of a science city.

The theme of this debate is the necessity for much more industrial investment in the Northern region. One has only to think what a large number of new employment opportunities could have been provided in that region if we had had access to the enormous amount of money which has been poured into the British car industry in the past two or three years. What a great number of jobs could have been provided in our region if the Government had listened to our pleas for the establishment of part of the car manufacturing industry in the Northern region. We are as entitled as any other area to be considered for such work.

I suggest also to my hon. Friend the Minister that the construction industry, along with or perhaps in advance of all others, has been and is the most capable of being stimulated in financial terms and should come under close consideration by the Departments concerned with investment. On every occasion when we have economic depression and decline, the building industry is the first hit and loses jobs and skills as a result of inactivity more quickly than any other. At times of economic recovery, the building industry gains jobs at a slower rate than does any other industry and it is always the last to recover from economic depression and decline.

There are some exciting new developments taking place in the coal industry, too, apart from the tingling excitement of INMOS and the silicon chip venture. I said earlier that I represent what can be regarded essentially as a mining constituency. Despite recession in the coal industry, I still have seven coal mines within the geographical limits of my constituency, two of them mining under the North Sea.

The National Coal Board is in the process of producing a plan for the liquefaction of coal. I corresponded with Sir Derek Ezra and with the Secretary of State for Energy earlier this year, having been alerted to what was happening some time ago, and asked for consideration to be given to siting this plant in my constituency. I know that there are greater concentrations of coal mining in other parts of the country but, having regard to the unemployment rates in my area, which are equatable with those of Sunderland and slightly less than in Hartlepool, as my constituency is part of Sunderland and is not far from Hartlepool what better qualification could it have for that kind of investment?

My hon. Friend the Member for Hartlepool said that he has a port in his constituency. I have one in mine, too. It is not by any means as important, and sadly not as busy, as Hartlepool's, but the port of Seaham in my constituency is quite an important cog in the industrial structure. Over many years now, the coal trade on which that port was almost exclusively dependent has virtually disappeared.

I am reminded by the reference of my hon. Friend the Member for Battersea, South to Battersea power station that most of the coal which fired that power station was transported from the tiny port of Seaham. It came straight out of the pit shafts and into the ships to go by sea to Battersea. I regret as much as he does the forfeiture of job opportunities because of the fate of Battersea power station as we now know it.

Here is another area for investment—in this case an outstanding claim to the European Commission for grant aid, or even a loan, to modify the port of Seaham so that it could in turn diversify in common with the changing industrial infrastructure in the Northern region.

I echo the appeal made by my right hon. Friend the Member for Sunderland, North for the appointment of a Minister for the North. I held that position for only eight months but I saw enough in that time to convince me that the appointment was justified and that it was a job which was really worth doing. We have already referred to what we regard as the unfair competition in the Cabinet. On occasions when it comes to decisions on industrial matters or the location of industry, whether it be the Ford plant in Wales or whatever it may be, there are people within the Cabinet who are more influential and whose voices are raised loudly, whereas our voices are not even present in whispers to say that our area is entitled to more urgent consideration.

In October 1967 a group of Northern Members, led by myself, interviewed for two and a half hours at No. 10 Downing Street the then Prime Minister, my right hon. Friend the Member for Huyton (Sir H. Wilson), and he accepted our arguments for the appointment of a Minister for the North. A month later he appointed the then Member for Newtonle-Willows, now my noble Friend Lord Lee in the other place, as the first Minister for the North. Afterwards, for eight months I occupied that position.

What we needed then we need even more now. We need co-ordination within and between Departments—the procuring Departments and those responsible for investment and taking important decisions.

A Minister for the North should be in the Cabinet, which I was not, but there is sufficient scope outside the Cabinet to jostle and to elbow vigorously, to plead and argue, and to demand as well.

I fully support the further claim in that respect of my right hon. Friend the Member for Sunderland, North. Unfortunately, the post was made redundant when Labour lost the election in 1970. The then Prime Minister did not think it necessary, presumably, to continue an appointment of that kind. But I sincerely hope that my right hon. Friend the present Prime Minister will do everything he possibly can to that end, and at least take it into consideration in the best interests of the Northern region.

2.38 p.m.

Mr. Giles Radice (Chester-le-Street)

I intervene at this late stage in the debate not just because of my interest in employment and industrial matters but because over one-third of my constituents live in the Sunderland district council area. With great respect to my hon. Friend the Member for Battersea, South (Mr. Perry), I shall follow the case put by my hon. Friend the Member for Houghton-leSpring (Mr. Urwin) and discuss the problems of the Northern region. I join with all my colleagues in paying tribute to and congratulating my right hon. Friend the Member for Sunderland, North (Mr. Willey) on his speech and on winning the ballot for the first motion today. I agree very much with what he said. I join with him in paying tribute to the Sunderland district council for what it has done to present its case to Whitehall. I thought it a very imaginative idea for its representatives to come down this year, as they did, to present their case to Ministers regarding what needs to be done in Sunderland.

My right hon. Friend described the problem of unemployment in Sunderland and its impact on the community. I have nothing to add to what he said. However, I wish to pay tribute to the Government for what they have done in their short-term special measures to help preserve jobs and to give people, particularly young people. some form of employment at this difficult time.

I shall concentrate on the contribution made to Sunderland by my own constituency, since Washington new town is only three miles down the road from Sunderland and it is part of the Sunderland district. I think that most people will agree that it is a considerable success story. It shows what can be done with a regional policy.

Since 1964 about 12,000 new houses have been built. I start with the environmental issues because they are important to job creation. A whole new environment has been created by the building of separate villages around a new town centre that comprises Washington new town. The new town has won international prizes for its design and architecture, and it is a marvellous environment in which to live, as has been shown by the success of Washington in attracting people to the new town. However, they have needed the jobs to bring them there. Since 1964, 15,000 new jobs have been created in Washington. That has compensated for the loss of mining jobs in the area. It has been a considerable help in alleviating the problems of Sunderland. We have one or two lessons to learn. The creation of a good new environment and the attraction of new jobs goes hand in hand.

The jobs are spread over a wide variety of employment—for example, making watches, records, television parts and tyres, and printing. There are many aspects of manufacturing and light engineering. There are small firms as well as medium-sized firms. I am sure that that is important. It partially explains why Washington has weathered the recession, with the exception of the closure of the Howard Rotavator plant. It has weathered the storm extremely well. New firms are still going to Washington. Many of the existing firms are employing more men.

What is good for Washington is good for Sunderland. People in Sunderland are going to Washington—it is a neighbouring town in the same district—to Washington to get jobs. It is important that Washington continues to prosper.

I draw one or two conclusions from the Washington experience. First, the success of Washington shows that it is essential to continue with regional policy —and I do not mean only incentives and grants but an overall commitment to regional policy.

There has been a fear expressed in the Northern region and on Merseyside that regional policy is being watered down. My hon. Friend the Member for Houghton-le-Spring referred to that. We have heard about the growth of unemployment in other areas. We heard from my hon. Friend the Member for Battersea, South about the growth of unemployment in London. The new inner city policy has benefited some areas and some towns in the regional development areas, but it has, in a sense, led to a watering down of the resources going to the regions.

There has been a concentration on industrial policy. Given Britain's weakness as an industrial nation and the problems that it is facing, it is only right that we should be concentrating on industrial policy. However, to a partial extent, there has been a move away from regional policy.

I revert to the question of incentives and grants. I hope that my hon. Friend the Under-Secretary of State will relate to his colleagues in the Department of Industry that we feel in special development areas that we do not have the advantage of incentives that we should have, given our special circumstances. The Department of Industry should consider that. We have lost the regional employment premium, and there are now few incentives directly related to job creation. Recent studies of regional policy have shown that much of the resources is going to capital intensive firms, some of which would have come to the region in any event. That is something else that the Government should consider. I am not saying that we do not need capital intensive firms—of course we need them—but we need a closer study of labour subsidies of various types as part of our regional policy.

We need to redouble our efforts to build up small firms. That is a problem for the whole of the United Kingdom as the small firm sector is the smaller part of the total manufacturing sector. That is particularly significant in the Northern region economy which has a small small firm sector. That is also true of the Merseyside. Both areas face the same problem.

Another conclusion that we can draw from the Washington experience is that we need to do a great deal to help ourselves. It is necessary to bea[...] in mind the disadvantages and the advantages of the Sunderland area. The disadvantages have been set out by previous speakers. We have suffered from the problem of older industries in decline. However, as my right hon. Friend the Member for Sunderland, North said, we have on Wear-side an up-to-date and expert shipbuilding industry. We have had the bad luck to see the closure of certain industries that were considered as replacements for the older industries—for example, the closure of Plessey and the firms involved in the clothing industry.

I turn my attention to the subject of labour. What are the advantages? We have a good labour force with high standards. We have good industrial relations. One of our weaknesses is that we do not have enough trained people. It may be that our skills are not those that are now needed to attract modern industry. That is the case that we have advanced in Sunderland for a new skill-centre. The Government have done a great deal in that direction, as my hon. Friend the Member for Hartlepool (Mr. Leadbitter) observed in his great speech. I think that my hon. Friend the Member for Hartlepool will be the first to admit that we have a long way to go. An effort has been made, but it is still far behind the efforts of countries such as Western Germany and Sweden. A nation depends on its skills, and if we fall behind we all suffer. Mr. Holley, the general manager of Washington new town whose paper has already been referred to, has called attention to the need for good communications and a good environment. I have already referred to the good environment of Washington new town. That is one area in which Sunderland could spend more money. That might help attract industry to the area.

Many hon. Members have referred to the entrepreneurial role. Washington is a major asset for the area. It is providing jobs, and it must continue to provide jobs for Sunderland. In 1980 responsibility for Washington's housing is being transferred to the Sunderland district. In 1982 the board is being wound up. We need to keep the "know-how" that the staff at Washington possesses to attract industry into the area and to develop it. We must encourage small firms.

My hon. Friends and I welcome the statement made by the Department of Environment my hon. Friend the Member for Easington (Mr. Dormand) had a part to play in it—that recognised the role of the Northern new towns in attracting industry and stated that they must continue to fulfil that role.

We have in mind a Northern development agency. It may be that the staff of the new towns could form the nucleus of such an agency. That is one possibility. What they need to do in the short term is to give as much help and advice as possible to the Sunderland council.

We all agree that it is appalling that we should have areas with a high concentration of unemployment. We need an imaginative and co-ordinated response by the Government. We need a renewed commitment to regional policy. A new look should be taken at the kinds of incentives which are relevant to special development areas and areas of high unemployment. We need a new look at how to help small firms. Above all, we need new mechanisms and a new framework—for example, a development agency for the North which will help the North to help itself.

2.51 p.m.

Mr. Eric S. Heller (Liverpool, Walton)

I feel that the House should thank very much my right hon. Friend the Member for Sunderland, North (Mr. Willey) for putting down the motion and giving us the opportunity to discuss once again the very important and difficult problem of unemployment. We have not discussed it in the House for some time, except at Question Time, when hon. Members are constantly raising, quite rightly, the problems in their own areas. I particularly like the terms of my right hon. Friend's motion, which begins by saying, rightly, that we fully appreciate the action already taken to combat unemployment ". It would be wrong for Members of the House to ignore the tremendous efforts made by the Government to deal with unemployment, particularly in the regions. Taking my own area as an example, the sad thing is that the Government in the past four years have poured in a tremendous amount of financial aid, they have built an enormous number of advance factories, they have assisted industry under the Industry Act 1975 and in many other ways, and yet unemployment persists at a grotesquely high level.

It is important to recognise that unemployment is not something peculiar to Britain. I listen to what Conservative Members say about unemployment, not that there are many of them here today to take part in the debate. It may be a comment on their attitude towards unemployment, but that is another matter. They argue that the Labour Government have doubled the figure of unemployed since coming into office in 1974. It is true that unemployment has doubled since 1974 under a Labour Government. Certainly part of the growth in unemployment has been the result of cuts in public expenditure—I am not arguing whether they are right or wrong—which have affected the public services. The Opposition have argued most strongly for these cuts. They have argued that the Government did not cut public expenditure enough. Had public expenditure been cut further, the levels of unemployment in the public services would have been that degree higher and that much worse.

Unemployment exists at a very high level in the United States and in West Germany, it exists in France, where the figure has just passed ours, in Italy and in all Western capitalist countries. None of them except Britain has a Labour Government. Therefore, it is not Labour Governments who are responsible for the growth of unemployment in the past four or five years. It is the crisis, which has developed on a world scale, in the economic system of capitalism which is responsible for the growth of unemployment. In fact, had we not had the measures carried out by my right hon. and hon. Friends on the Front Bench, our levels of unemployment would have been that much higher. It is quite right, therefore, for my right hon. Friend to draw attention to the fact that we should appreciate the action already taken. Nevertheless, we also have to admit that the action is not in itself sufficient.

I should like now to give some figures for unemployment in my own area. We are talking now about people unemployed. We are talking about human beings. I was speaking yesterday to a group of business men. One business man said that he did not like paying higher taxes because it helped to keep people unemployed, as though the people who are unemployed want to be unemployed.

We have lost up to now this year on Merseyside about 13,000 jobs. For the city of Liverpool travel-to-work area, on 12th October the number of male unemployed was 43,146, and the number of female unemployed was 16,963, making a total of 60,109.

For the Merseyside special development area, which includes Birkenhead, Bootle and a number of towns on Merseyside, on 12th October there were 88,166 unemployed. That represents a level of unempoyment of between 12 per cent. and 13 per cent. Breaking down that figure and looking at it closely, we find that certain working class estates in parts of the special development area have an unemployment rate of 30 per cent. and above. It is quite true that the Northern region as a region has the highest unemployment rate, at 8.1 per cent. The unemployment rate in the North-West region is about 6.8 per cent. But in looking at the North-West region as a whole, we have to recognise that the area which produces the highest rate of unemployment of all in that region is Merseyside. I am not saying that the position in other parts of the region is by any means good, but it is relatively good when compared with that on Merseyside. We have a very real special problem.

I mentioned the loss of jobs which has occurred in the past year. With the 2,400 jobs at the Dunlop plant at Speke now under threat, there are now 12,870 workers on Merseyside whose jobs have either already gone this year or are expected to go this year. That is a lot of jobs. Unemployment had gone down from 12th October to 9th November in the Merseyside area by 1,481. That is absolu- tely marvellous, except for the fact that since 9th November a number of companies have now indicated that there will be further redundancies and closures. Therefore, while we can cheer a relative decline, the overall position is as bad as ever.

Let us look at some of the figures for this last period: Lucas Aerospace, 950 jobs lost; Cammell Laird, 850; English Electric, 670; Western Shiprepairers, 626; Plessey, 600; Spillers, 520; Birds Eye, 450; Tate and Lyle, 400; Meccano, 350; Courtaulds, 320; Ocean Transport and Otis Elevator 300 each. Yet we are nowhere near the end of the line with redundancies, because lesser known and smaller companies are also laying people off, or have threatened to do so.

Mr. Alan Clark (Plymouth, Sutton)

Will the hon. Gentleman give way? I know that it is a cheek to intervene, as I have only just come into the Chamber, and I do so with the greatest diffidence. But at the start of the hon. Gentleman's list I recognise four names of defence contractors. Does not he agree that his party's steady erosion of our defence expenditure in real terms has much to do with increasing unemployment among defence contractors, of which he has named four or five? I think that they amount to nearly 30 per cent. to 40 per cent. of his total.

Mr. Deputy Speaker

Before the hon. Member for Liverpool, Walton (Mr. Heffer) replies, may I indicate, particularly to those hon. Members who have just entered the Chamber, that it was arranged—it was more or less understood—that the winding-up speeches would begin at 3 o'clock.

Mr. Alan Clark

I apologise, Mr. Deputy Speaker.

Mr. Heffer

I am very sorry, Mr. Deputy Speaker, but with whom was it arranged? Nobody arranged it with me, or asked me to stop speaking at 3 o'clock. On the one hand the Whips say that they want people to speak, and on the other they say that they should not speak. We hear that there are arrangements with the Opposition. I intend to take no notice of all those discussions but to continue to make my speech in the way that I had hoped to make it. I shall try to finish it. If it means that there is a slight cutting down of their speeches by the Front Bench speakers, that is too bad. I should regret it, but I have the right to make the points that I intended to make.

I shall not answer what the hon. Member for Plymouth, Sutton (Mr. Clark) said but merely point out that Cammell Laird rarely made naval ships on Merseyside. It made some, but the greatest loss at Cammell Laird is that orders for ships are not being attracted from anywhere. The naval ships are probably still the shipbuilding industry's best bet from the point of view of orders. It is the other aspects that are responsible for the redundancies.

I have been somewhat put off by the fact that I am supposed to be concluding earlier than I had expected. I shall not hold up the two Front Bench speakers if they want to start earlier. However, I wish to comment on what was said by my hon. Friend the Member for Battersea, South (Mr. Perry) about unemployment in inner London, which he considered was growing to the same level as that in places such as Sunderland and Merseyside. Unfortunately, I think that that is true.

There are pockets of high unemployment in inner London. The Government recognised that when I was in office, and we decided to assist in whatever way we could to overcome that problem. But as unemployment levels have increased in inner London they have become that much worse in areas such as Sunderland and Merseyside. Unfortunately, it is not that we have held our levels low and then helped to solve the problems of inner London. Its problems have increased and those in our areas have become that much worse. In that sense we have gained very little.

Therefore, we should not put ourselves in a position of competition between one area and another. The point is that we have an unemployment problem affecting every part of the United Kingdom. I have pointed out that it is not confined to the United Kingdom but is endemic in western capitalist society. When we talk about solving the problems of unemployment, we must recognise that there is a need to change the economic system in which we live.

My hon. Friend the Member for Houghton-le-Spring (Mr. Urwin) said that he wanted the silicon chip factory in his area. Naturally, we should like it in Merseyside. But whether it is in the North or on Merseyside, it will put more people out of work. The very fact of that new technology coming into being will put thousands out of work to begin with and millions over the long period.

We must reorganise our society. We must accept that, with modern technology, the present economic system cannot deal with the problem of unemployment. We must go beyond the question of growth and profitability. We must think in terms of creating work, reducing the number of hours worked, having longer holidays and a greater and fairer distribution of the wealth which is created. That is why I believe we should support the demand for a 35-hour working week. It is absolutely right.

It is interesting that the United Automobile Workers of America has just sent a telegram to young people in the Labour Party who are organising a campaign for a 35-hour working week saying that it fully supports that campaign. It is also interesting that the German metal workers have voted for a strike in support of a 35-hour working week. The trend is moving in that direction. We must share work and cut the number of working hours. That situation must be dealt with quickly.

Coming back to the problems on Merseyside, what shall we do? I think that we need a Minister not for the North, as was suggested by one of my hon. Friends, but for areas such as Merseyside. I am talking not of another regional Minister, but of a Minister with the responsibility and power to co-ordinate the activities of those Departments which are responsible for work creation in regions of high unemployment. We need a co-ordinating committee for the Departments of Industry, Employment, Environment and others on the periphery not necessarily with a special Minister, but with a Minister responsible to this House and to the regions in order to begin to deal with unemployment. I accept that the problem of unemployment cannot be solved on its own. However, it represents a special problem and my right hon. Friend the Member for Sunderland, North was right in his motion to refer to it.

We must step up assistance to small businesses in areas of high unemployment. But in the meantime I want my right hon. and hon. Friends to consider what I suggest is a revolutionary proposal at this stage. I suggest that in areas such as Merseyside and Sunderland—I am sure the same argument can be made for other areas—where there is constant unemployment due to plant closures and high redundancy levels, we need not only the present subsidies to keep people at work, but, if need be, higher subsidies to keep them at work until we have alternative employment projects. I think that we must consider that matter now.

Merseyside cannot accept any further redundancies. We just cannot live with that situation. Merseyside already has about 13,000 workers unemployed. It is expected that by the end of the year the situation will be even worse. People there are beginning to feel that no one is interested in them. They feel that they are being forgotten and that the Government are not concerned. But I know that the Government are concerned. Indeed, my hon. Friend came to my constituency only last weekend and announced very good assistance to the Liverpool city council which will create between 750 and 800 jobs in the construction industry providing modern council dwellings and at the same time taking people off the dole. That is excellent. But at the same time a big company in the area announced 2,500 redundancies. We cannot go on in that way. People are beginning to despair. Therefore, we must overcome this problem, and overcome it quickly.

I have sent a letter to the Prime Minister asking for action to be taken at the earliest possible moment. My hon. Friends and I from Merseyside have worn out various carpets to Ministers, to the Prime Minister and to the National Enterprise Board over the past 18 months. The National Enterprise Board has been a great disappointment in the sense that it has developed only one project on Merseyside. Part of the board's remit, according to the Industry Act, was precisely to concern itself with the development of employment in areas of high unemployment. It has not done the job as we wanted it done.

I asked my hon. Friend to convey to the Cabinet our deep feelings about this matter. The time for discussion has really ended. We need more positive action to begin to deal with problems such as those of Merseyside, Sunderland and other areas of very high unemployment where people are reaching the point of despair.

3.11 p.m.

Mr. Fred Silvester (Manchester, Withington)

We join those who have congratulated the right hon. Member for Sunderland, North (Mr. Willey) on winning the ballot and choosing this subject for debate. Like all those who have spoken, except the hon. Member for Liverpool, Walton (Mr. Heller), we have looked at the subject from the point of view of the North-East, and that, indeed, was what the right hon. Gentleman had in mind. I may add that the Opposition have caused unemployment to be debated in the House more times than anyone else has. I believe that the only two major debates on the subject in the past year have arisen on Supply Days. Therefore, we are not about to take criticism of our concern, and it does not advance anyone's cause to press such criticism too hard.

One interesting feature of the debate is that, although the motion draws attention to "special measures", few hon. Members have spoken about them. I take it that these special measures are those listed on the back of the press notice every month. The hon. Members for Sunderland, South (Mr. Bagier), Hartlepool (Mr. Leadbitter) and Walton made mention of them, but overall little attention has been given to them.

In a way that is not surprising, because they are the froth on the top. It is as though hon. Members who were suffering from food poisoning were suddenly grateful for aspirin when they should be looking for the bugs in the kitchen.

All these measures we have been concerned with month after month have in some cases been useful and in others not so useful, but together they add up to very small beer in the context of the total unemployment problem. It is therefore not surprising that those who have spoken have not given much attention to them.

I should say something about the Opposition's attitude to these measures since they should form part of our discussion. It is often suggested that the measures have a nil, or virtually a nil, cost because there are offsets against the cost, but that is not quite so. They probably cost rather less than some other devices, but the best way to avoid costs of this kind is to reduce the total of unemployed. All the Government are doing by this method is producing a subsidy, a device, to make life more bearable for the unemployed, which may in net terms cost somewhat less but has very severe disadvantages in addition.

There is precious little in this world which one does not pay for, and one of the factors so often ignored in the talk about these temporary measures is that they have a cost in terms of the hidden loss of jobs in other areas. It is very much easier to talk about "saving" a particular job because one can attach a sum of money to it and can therefore identify it. It is much more difficult to identify the loss of jobs which arises from the taxation necessary to carry such measures or from the additional competitive burden that they may put on some firms on the margin. We have no means of knowing, and I do not think that the Government have estimated, the loss, although they acknowledge its existence. We would put it that probably half the total number of jobs "saved" are lost along the pipeline somewhere else. That has to be remembered, although it is difficult to express in simple public terms since saving is so much more popular than explaining the net results of that saving.

It also has a productivity cost. It encourages us to put so much of our resources into industries which, with the best will in the world, will be on the decline. This is not always the case, and there are examples where people who have been propped up by these measures have been able to take the necessary remedial action and to go on from strength to strength thereafter, But, unfortunately, there are also large numbers of people who are not in that position. We have to bear in mind that probably the most important problem facing us is the extent to which we can produce goods on a competitive basis. If we continue to put most of our resources into industries which are on the decline or which have poor productivity levels, although it is very nice for the people currently working in them—I can quite see why people are moved to do it —it is not very good for other people in other jobs and those waiting for jobs in other parts of the country which are in need of growth industries.

In order to clarify my own mind, I should like to put a specific question about these matters to the Minister. In the latest press releases, I notice that the number covered by the assisted schemes is declining steadily. In June it was 310,000. Currently it stands at 265,000. But, perhaps more interestingly, the amount of money in the estimates for the current financial year, according to the latest press release, is put at £410 million. Last month's was put at £490 million. Three months ago it was put at £530 million. So it is clear that the amount of money devoted to these schemes has been reduced substantially in the current financial year, and it will be interesting to know how that sum is arrived at.

However one thinks of individual cases in this connection, the problem is that schemes of this kind are bound to be only a short-term palliative. It is to the longer term that we must look and to the more deep-rooted causes of the unemployment. That is really what the right hon. Member for Sunderland, North sought to do. There is no doubt on either side of the House about the nature of the unemployment. No one believes that there are not parts of the country where the depth of the unemployment is so grave and the risk to people's morale is so acute that it is of quite a different order from the kind of unemployment which arises in the middle of a depression.

In a previous debate, my right hon. Friend the Member for Sidcup (Mr. Heath) referred to a survey conducted by New Society about the effect of unemployment, especially on young people. I remember how it said that in the first four to six weeks they were buoyed up with the hope that a job was coming. Then there set in a sense of idleness and gradually no wish to work. Finally, as they moved to long term unemployment, there was a sense of resignation and despair. That is so depressing that it is worth our while spending money on some of these schemes to attempt to secure jobs for them. In that respect, I hope that the Minister will say how these schemes designed for young people are working.

In January this year, when the Secretary of State announced the new schemes for young people, he said: We reach the next important stage on 1st April. The youth opportunities programme will replace or subsume all current schemes for unemployed young people and will double the provision that we make for them. He said that the programme would go on for 230,000, and that it would give every year a unique guarantee that any youngster who leaves school at Easter or in the summer and who has not obtained a job or chosen to go on to further education will be offered an appropriate place somewhere in the scheme for training and work experience."—[Official Report, 30th January 1978; Vol. 942, c. 65.] That was a firm commitment that all young people not saying on at school or going to college would have a place in the scheme. The register still shows high levels of youth unemployment, and I should like the Minister to say how he thinks this matter is proceeding. The scheme has been operative for six months and was picked up from the job creation scheme which preceded it. I think that we should be seeing some results now.

I turn now to the much more important area concerning the long term, how we deal with it and how to put matters right. First, there are the special problems of the regions. Greater Manchester, of which I represent a part has unemployment of 5.7 per cent. That is substantially below the level in Sunderland, but Manchester has been plagued with unemployment for a long time. It is adjacent to the constituency of the hon. Member for Walton. We therefore understand the sort of problems that he mentioned, although some of the Manchester constituencies do not suffer from them. I completely agree with him that Sunderland's problems are a national responsibility. It is clearly not possible for a local authority or for the people, however much they may help themselves, to get ahead without national help. We do not intend to remove that help.

I make that point clear because there are sometimes misunderstandings and a deliberate misrepresentation of my party's point of view. I think that there will be changes in regional policy, though there one has to take some care, as my right hon. and learned Friend the Member for Surrey, East (Sir G. Howe), the Shadow Chancellor, said. He is most anxious to make sure that there is continuity so that business men know how to plan. I think we would all agree with that.

Nevertheless, substantial criticisms of the way regional policy works have emerged from the debate. The right hon. Member for Sunderland, North said that it was necessary to concentrate more of the resources that are available in this direction. The hon. Member for Walton referred to the differences between some parts of the North-West area and others. My hon. Friend, the Member for Newcastle upon Tyne, North (Sir W. Elliott) went to some lengths to point out the inadequacies of the growing bureaucracy and of the reports and bodies which are producing masses of information but not the bite needed for action in these areas.

It is silly, therefore, to say that we have reached the point where no changes will be made. If I were asked the direct question whether we shall save money by it, my answer would be that we certainly hope to save some money in this area as we will in others.

We want to be imaginative. I do not think that all that much imagination was displayed when people jumped on my right hon. and learned Friend's back when he suggested the idea of special areas where some of the restrictions which currently operate on business might be might be withdrawn. I do not know whether such a scheme would work. However, it is worth consideration. Anyone who rejects these proposals in a cavalier way is asking for trouble.

I wish to take up the speeches by two hon. Members who did not help the cause of regional matters. The hon. Member for Consett (Mr. Watkins) spoke of private enterprise not being interested in the North-East. He quoted the people in charge of INMOS, saying that they would make a decision purely on business grounds and that they would not change their minds purely on the basis of employment or special criteria. It would be wrong for INMOS or anyone else to make a decision simply on that basis. We want to set up viable industry which will draw on all the necessary resources—intellectual and capital—which will enable it to survive and build another industry around it.

Of course, if I were to abuse my position here, I could make an extremely strong case for INMOS going to Manchester. Since the right hon. Member for Sunderland, North did not get his technical university, and since we happen to have one in Manchester, we are ahead of him in that game. But it does no one any good to make this kind of special pleading when we need to ensure that, where businesses are diverted into the regions, it is done on a proper and sensible basis, not in response to a cri de Coeur which bears no relationship to reality.

I was distressed to hear the hon. Member for Sunderland, South quote the chairman of the Conservative Party. It was unnecessary, and I have taken the trouble to find out the actual position. Apparently, the hon. Member for Sunderland, South was accusing Lord Thorneycroft, in his capacity as president of the British Radio Equipment Manufacturers' Association, of stopping Hitachi coming to Durham. I am informed that both the industry and the unions were concerned about this. Both were asked for their views about the advisability of the project. In the light of the evidence available to the industry and the unions, they decided that it would be detrimental both to the industry and to those who work in it if the project went ahead. It was agreed unanimously by both sides that there would be damage to the industry in general and particularly to the components industry on Wearside. It was a joint function between industry and the unions, and I do not think that the hon. Member's statement should go unchallenged.

Mr. Bagier

Will the hon. Gentleman have further conversations with Lord Thorneycroft and ask him whether he led the campaign against the introduction of Hitachi to this country? Is it not a fact that all the documentation presented to the trade union side was at national level and not at local level? My argument with Lord Thorneycroft was that he utilised his position—quite correctly, in his view, as a business man—in order to keep out of this country a competitor whom he saw as dangerous to his own position. I thought that was wrong. I also said that I thought that the trade union side was wrong at national level, and I still maintain that view.

Mr. Silvester

I am sorry that the hon. Member has not withdrawn. It does not help to say that Lord Thorneycroit abused his position to advance something that was of advantage to himself.

Mr. Bagier

I did not say that he abused his position. I simply said that as chairman of the organisation he used his position. I was merely stating facts.

Sir William Elliott

May I recall what the hon. Member for Sunderland, South (Mr. Bagier) said? He said that the chairman of the Conservative Party was wearing his business hat, which was a very pointed comment. I have followed very carefully the attempt to get this industry, as I have followed every attempt to get industry, to the North-East of England. The least that the hon. Member could have done when attacking the chairman of the Conservative Party was to place equal responsibility on the trade union movement, which should fairly have shared it.

Mr. Silvester

I think we must move on from that point. I have made it clear. even if the hon. Member for Sunderland, South did not, that the unions involved and all those in the industry who were involved agreed that that action was a combined operation.

On the question of devolution and the growing pressures in the North, I believe that there will have to be some modifications of structures if the referendums go in a positive way. I cannot see how the Northern area of England or the South-West area for that matter, will put up with it. I am reluctant to see the creation of another tier of government. I should like to see some way, which is not possible within the existing institutions, of devolving more decisions locally. That may be a somewhat wet answer but I am extremely chary about setting up new institutions, such as regional assemblies. I would rather see a halfway house. If that proves unsuccessful we are headed for a federal Britain of some kind.

The hon. Member for Walton said that the present situation is a result of a world-wide crisis of capitalism and that without changing the system we shall not solve the problem. We agree that we must change the system that has been operating since 1974. Then there would be a good chance of getting it right. However, he and I are talking of changing the system in different ways. Clearly he is not satisfied with what the Government have done any more than I am. but I suspect that we have different solutions.

We have agreed that there are deep underlying problems which require special aid. But the most important feature about unemployment in the regions is the general level of the economy. The regions respond to that level. They pick up or do particularly badly. They get wet more quickly when it rains and dry up more quickly when the sun comes out.

Unless we can secure a better growth for the country, there is not much chance of solving the problems. How do we do that? According to the evidence presented by the Government today, they do not hold out much prospect of the situation improving as a result of what they are doing.

The Manpower Services Commission has produced as gloomy a forecast as ever for 1982. Yesterday the Government Actuary, on the instructions of the Treasury, was given the forecast that unemployment would not go down at all next year. The CBI forecasts for next year are not at all optimistic.

Under the Government's present policies, there is little chance, according to their own figures, of a turnround in the general level of unemployment up to 1979. If one adds to that the Manpower Services Commission forecasts for the longer term and the growth in the work force—it is forecast that we shall need 1 million new jobs before 1981—one can see that such a dynamo is required that we must produce about 30,000 jobs per month.

One way of assessing the likelihood of our success is by attitudes to innovation and technology. I have been struck by a particular attitude in the debate, and it was most depressingly expressed by the hon. Member for Houghton-le-Spring (Mr. Urwin). The same attitude has been expressed by others, including the Secretary of State. It is not true to say, as the hon. Member for Houghton-le-Spring said, that the new technology is different from that in the old industrial revolution and is therefore throwing people out of work and not producing new jobs. During the first industrial revolution some people were anxious to stop the new technology because it was throwing people out of work and not producing new jobs.

It is important that the country should have a sense of optimism about these developments. Without a sense of optimism about the new technology, there is no hope for us. As sure as eggs are eggs, the problem will not go away. We shall not overcome the problem simply by working a 35-hour week—although that would be nice.

There will be social changes. People will want more leisure and less overtime. On the other hand, more women will go out to work. A number of social factors are developing and technology will play its part in deciding how it will all work out. Therefore, do not let us knock technology and say that it is not a source of growth and income. It can be a growth area, and it is most important that places such as Sunderland and the North-West should have a much more positive and optimistic attitude.

The problem is that there is a gap between the implementation of the change and the reaping of the fruits. There is always difficulty when one seeks to change technology. It is seldom that the person who is thrown out of one job immediately picks up another, and many personal problems are involved in such changes. However, the net effect can be most beneficial. We should ensure that people understand and approve of that aspect rather than that we should always harp on the detrimental effects of new technology.

Let me seek to put my position on the difference in philosophy between the hon. Member for Walton and myself. We do not believe that the possibility of generating new jobs arises essentially from the ability of Government to plan, devise and secure resources for allocating jobs and directing people into them, but we believe that it is possible to fulfil that aim by releasing the energies of people individually. Such factors would operate differently in Sunderland compared with Liverpool. Various areas will take up different technologies in different ways, and factories in those areas will be run in different ways.

There is no way in which the Government can undertake all those things. Therefore, the hopes of the country lie in releasing the energies of our people. We are debating the ability to find the motives by which people can release those energies. Because of the time element, I cannot go into all those matters now, but I must put forward some of them again because they are worth repeating.

First, there is need for a substantial reduction in taxation. The Conservative Party believes—and the Labour Party is gradually dragging its feet towards this idea—that such a reduction is one of the chief motivating factors in the improvement of the welfare of this country.

Mr. Heffer

If taxation is cut, as the hon. Gentleman suggests, will it mean a sudden burst in industrial development, or will it mean that the old lady who should be provided with a telephone in her own home and a home help will not receive those facilities, and that the extra nurses and improved health services in the community will not be provided? Surely this has been the experience in California where there was a vote on this matter. People in other parts of the United States, once they saw what happened in California, did not follow suit.

Mr. Silvester

Since in California they are still living off their balances, I do not think that that is a useful debating point.

The basic position is that we have experienced years of high taxation in which public expenditure has still been squeezed. Local authorities find that they are still unable to assist the old lady with a home help, despite the existence of high taxation levels. Unless we release these pressures, we shall not generate the wealth from which these desirable principles will arise.

We do not have to guess at these matters. We can see the way in which a different policy has produced jobs. Let me give a few figures. Between 1952 and 1956, 1 million new jobs were produced by private business; between 1959 and 1962, 830,000 new jobs were created; between 1962 and 1966, 600,000 jobs were created; and between 1971 and 1974, 780,000 jobs were created. I do not make that claim simply because I am a Conservative or because those happen to be years of Conservative rule.

The point is that it is something upon which people can build hope. If one continually tells people that the problem is beyond solution, if one constantly says that we need 1 million new jobs and, when asked where they are coming from, gives no answer, one makes the situation worse. The Conservative Party believes that the package of policies it proposes can, as has been done in the past, produce those jobs.

3.41 p.m.

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

The hon. Member for Manchester, Withington (Mr. Silvester) asked questions in his speech which lasted 28 minutes, leaving 20 minutes for me to reply to the whole debate. I hope that the House will excuse me if I ignore his contribution and reply to my right hon. and my hon. Friends.

First, I should say how pleased I am to see here with me on the Front Bench my hon. Friend the Member for Easington (Mr. Dormand) because before this debate, as a very good secretary of the Northern group of Labour Members, he has constantly made representations on behalf of the North and all Labour Members, emphasising to the Government the problems of unemployment. He has of course, never failed to mention his own constituency of Easington and he has constantly focused attention on Peterlee, but at the same time he has spoken for the entire North when drawing our attention to the problems of male unemployment, long-term unemployment and youth unemployment. His efforts have been equalled only by those of the secretary of the Liverpool group of Labour Members, my hon. Friend the Member for Liverpool, Garston (Mr. Loyden) who has spoken on behalf of that group and brought to our attention the same problems.

It has been a very interesting, good and deeply serious debate. There have been excellent contributions from my right hon. Friends the Members for Sunderland, North (Mr. Willey) and for Middlesbrough (Mr. Bottomley) as well as from my hon. Friends the Members for Sunderland, South (Mr. Bagier), Consett (Mr. Watkins), Houghton-le-Spring (Mr. Urwin), Battersea, South (Mr. Perry), Hartlepool (Mr. Leadbitter), Chester-leStreet (Mr. Radice) and Liverpool, Walton (Mr. Haffer). There was also a solitary contribution from the most lonely man in the Chamber today, the hon. Member for Newcastle upon Tyne, North (Sir W. Elliott), speaking from the otherwise empty Conservative Benches.

We are grateful to my right hon. Friend the Member for Sunderland, North for the manner in which he framed and presented his motion. His report on the Government—" Tries hard but must do even better "—is rather kinder than a school report that I once saw which said "Tries hard… to do nothing".

The Government certainly are trying hard to do all that they can. My right hon. Friend has constantly presented Sunderland's case to the Government. No man could have done more. I am glad to see with him today my hon. Friend the Member for Sunderland, South. My hon. Friend the Member for Chester-leStreet has been equally forceful. They, together with the council, have constantly ensured that we in London know the facts about unemployment in Sunderland.

Before I run out of time I must say that I have great sympathy with them when they argue the case for skill training in Sunderland. When they brought their deputation to see a group of Ministers earlier in the year, I replied that we should await the result of the training opportunities programme review before we made any decisions.

We now have that review and, as a result of the representations that they have made, I shall be asking the Manpower Services Commission to prevail upon the training services division to discuss with the local authority in Sunderland the application of that report to Sunderland. It is extremely important that we do all that is possible to enhance training and retraining in Sunderland. I repeat that the Government are well aware of the problems in Sunderland and its very high level of unemployment. My right hon. and hon. Friends know that the Minister of State has been personally involved, as has my right hon. Friend the Secretary of State. Only last Friday my right hon. Friend discussed the problems of Sunderland with, among others, Councillors Harper and Campbell. My right hon. and hon. Friends know that we met with a most formidable deputation.

The special measures have been a great help to Sunderland. The temporary employment subsidy has helped 1,854 workers. The youth opportunities programme has helped 746 youngsters, the special temporary employment programme has taken up 93, job creation has helped 1,648 in Wearside, 969 were helped by the youth employment subsidy and 520 have been helped by the recruitment subsidy for school leavers. The job release scheme has assisted 145 and the small firms employment subsidy has helped 50. Therefore, help has been given.

We would like Sunderland to take greater advantage. There is money available under the special measures that has not been taken up. It is for Sunderland to take more advantage of the special temporary employment programme, the job release scheme and the small firms employment subsidy. My right hon. Friend the Member for Sunderland, North highlighted the problem of youth unemployment. I have had glowing reports of the efforts of the careers service in Sunderland and the progress that it is making in finding places for unemployed youngsters.

Employers in Sunderland have responded extremely well. Two major schemes have been mounted to provide places for youngsters without qualifications. The springboard scheme, which is supported by voluntary bodies, provides 240 community service places. A project-based work experience scheme sponsored by the Sunderland borough council provides 150 places in community action teams. Under the scheme youngsters carry out community work, especially for the old and disabled. It has been successful in creating good relationships within the community. In addition, five training workshops have been set up in the Sunderland area.

Even so, there are still 650 young people who left school last year who have not yet had the offer of a job. I appeal to my fellow trade unionists and to employers to try to ensure that these youngsters are given a chance.

I answer obliquely a question posed by the hon. Member for Manchester, Withington who spoke from the Opposition Front Bench. In general, the youth opportunities programme is going extremely well. However, we still have the problem that not enough offers are being made by employers to youngsters with no qualifications.

Often employers are willing to make offers to the brightest and best of our young people. Too few offers are coming from industry for youngsters without qualifications. I appeal to employers throughout the country as well as in Sunderland to make places available for them. The money is available. In many instances we are waiting for a response from private industry.

Sunderland was one of the original eight centres set up in 1972 by community industry. The scheme offers 200 places to young people from Sunderland and neighbouring Easington. There are currently 115 Sunderland youngsters benefiting from the scheme.

My right hon. Friend the Member for Sunderland, North mentioned the problem of unemployment among the disabled in Sunderland. There have been important initiatives nationally to assist in providing regular employment for the disabled. The job introduction scheme, the capital grant scheme to adapt premises and machinery to make it possible for the disabled to work in normal employment, and a revised fares-to-work scheme, are all important measures, but the take-up has been disappointing. I have been very disappointed with the response from employers, not only nationally but also in Sunderland. In Sunderland only three people have been helped by the job introduction scheme, only one by the faresto-work scheme, and none at all under the capital grants scheme.

Government can do a lot to make it possible for localities to provide for their own people, but it depends always upon local initiative to make certain that the money made available by Government is spent. I appeal to Sunderland and to the North—in fact, to the whole country —to make absolutely certain that money made available for the employment of the young and of the disabled is taken up.

I know that my right hon. Friends are concerned with providing new employment in general to offset the distressing redundancies. All is not gloom and doom in the locality. Dunlop Hydraulic Division has moved into Sunderland quite recently, and Timax, Philips, RCA Records and Midland Electric Manufacturing have moved into Washington New Town, all of them with considerable financial assistance from the Department of Industry. I underline that the centre to administer the child benefit scheme has been placed in Washington New Town, and by 1980 there will have been a net increase in jobs of 1,500.

Sunderland is one of the 15 authorities designated by the Government under the inner cities policy as a programme authority—that is, as an authority having inner area problems severe enough to merit special assistance but short of a full partnership basis. As such, Sunderland has been invited to prepare a comprehensive programme indicating the measures it intends to take in dealing with its inner area problems, and in respect of which it will receive an enhanced level of assistance of the order of £1¼ million under the urban programme. Sunderland has prepared and submitted its first programme for 1979–82, and we believe it to be a good one. I understand that talks are taking place on this at the present time.

I have referred to some of the effort that the Government are putting in for Sunderland. Had there been time, I should have liked to enumerate all the effort that the Government are putting in to assist the North, because we are well aware that there are substantial problems of unemployment not only in the North but in the North-West, and particularly on Merseyside. I have spent a considerable amount of my time over the past two years on Merseyside and in the North-East in seeing the problems at first hand and appreciating how bad they are.

Sir William Elliott

May I ask the Minister's aid in one regard? During the course of the debate, in which the Minister has listened patiently to our pleas, I received a message to the effect that the Tyne is likely to lose a much-needed order because of an industrial dispute on the part of draughtsmen on Teesside. If the Tyne loses the order, it will mean that all five berths on the Tyne will be empty for the first time since before the War. Will the Minister join me in appealing to those draughtsmen on Teesside to let the Tyne have the drawings next week? It is imperative. If we do not get them, we shall have a lot more unemployed people on the Tyne.

Mr. Golding

My long experience as a union official has taught me never to make off-the-cuff remarks concerning an industrial dispute. I shall certainly draw my right hon. Friend's attention to this problem, which is appropriate for ACAS.

It is important to put on record having heard the speech from the Opposition Front Bench, by the hon. Member for Manchester, Withington, that Britain's position today is far better than it is has been for many years. The gross domestic product grew at an annual rate of between 3 per cent. and 4 per cent. over the first half of the year. Living standards by the middle of this year were up by 7 per cent. on last year's. That is before all the tax rebates under the Finance Act became effective. The annual rate of retail price increases is now half of what it was a year ago.

Above all, unemployment in the past 12 months has fallen by well over 100,000. It is not long since academic commentators and journalists were talking of 2 million unemployed. They were wrong, and I hope that when people read their present predictions that future levels of unemployment will rise to between 3 million and 5 million they will take such forecasts not with one pinch of salt but with several. Whether or not we have high levels of unemployment depends on decisions taken by people. I do not believe that we need have such levels. It should be an essential objective of this Government to secure a return to full employment. That must be a central objective of any Labour Government.

We shall do all we can to return to low unemployment levels, but it is the Government's belief that unemployment is due not only to the rise in the price of oil, the effects of the trade cycle and the increasing numbers of people wanting work, but the lack of competitiveness and structural changes. Several hon. Members have made this clear. For this reason, we are absolutely determined on a regional policy. I should have liked to speak about this in more detail, but I have only two minutes. However, let me emphasise again that it is the Government's intention to continue to pursue a very strong regional policy.

We shall continue to do all we can to make it possible for areas such as the North-East and Merseyside to enjoy the same prosperity as is found in other parts of the country. Where there are similar problems elsewhere, as in inner Birmingham and inner London, we will take positive action.

Our first job is to ensure regular employment for all our people. That must be the underlying purpose of our policy. It is equally important that when people are unemployed in such large numbers we have our special measures. We cannot tolerate a situation in which people are unemployed when it would be possible through the use of special measures to avoid that unemployment.

I thank my hon. Friends for the way in which they have spoken, and I have pleasure in telling them that the Government accept the motion.

Question put and agreed to.

Resolved,

That this House while recognising and fully appreciating the action already taken to combat unemployment, nevertheless believes that more needs to be done, and, in particular, calls upon Her Majesty's Government to take further special measures in the case of Sunderland and similar areas which are suffering persistent exceptional high levels of unemployment