HC Deb 20 June 1979 vol 968 cc1463-72

Motion made, and Question proposed. That this House do now adjourn.—[Mr. Wakeham.]

10.34 pm
Mr. John Townend (Bridlington)

I thank the Minister for being present to hear about an important problem for my constituency—the need for development area status for Bridlington. The Bridlington employment office area covers 35 square miles. Bridlington is the main town, with 27,500 of the 32,000 population.

The town is a popular seaside resort. Industry is dominated by the tourist trade. It has a correspondingly small amount of manufacturing industry. Dealing with the history of this problem, I point out that Bridlington has had a rate of unemployment higher than the United Kingdom national average since the early 1950s. As a result of this, in 1958 it was made a designated development district.

This had an immediate effect and greatly helped the development of the Bessingby industrial estate. Unemployment steadily dropped until in 1966 it was just over 4 per cent. As a result of this, Bridlington's development area status was taken away and unemployment started to rise almost immediately. In 1971 the employment office area of Bridlington was made an intermediate area. However, at that time the district council felt very strongly that the unemployment statistics had been misinterpreted by Whitehall and that Bridlington should have had its development status restored.

Although the intermediate area status had an effect and halted the steep rise in unemployment, the level never fell below 7½ per cent. In 1976 it started rising very steeply, until by January of this year the male rate of unemployment was no less than 14.7 per cent. and the overall rate was 11.8 per cent. This is almost double the national average.

Throughout the whole of this period the Scarborough employment office area to the north had development area status even though the level of unemployment in Scarborough was considerably lower than that of Bridlington. But the real blow to the town came in April 1977 when, as my hon. Friend I am sure is aware, the last Labour Government were facing a very tricky by-election in Grimsby. They were really desperate to win that by-election. They announced at that time that both the Grimsby employment area and the Hull employment area would be made development areas. I am quite convinced that there was no coincidence about this decision, which was announced just before an important by-election.

I admit that it was politically motivated to gain votes and to help the Labour Party retain the seat, which it did with a very narrow majority. When this action was taken Bridlington again had a substantially higher rate of unemployment than either Hull or Grimsby. That action meant that Bridlington was surrounded by development areas, both of which had a lower rate of unemployment. This virtually nullified any help that the town was getting from its intermediate status.

Why should any industrialist wishing to relocate his factory go to Bridlington when he could go 20 miles either way and relocate in a development area and get all the additional benefits? I think that the blatant unfairness of the present position is shown when we examine the latest unemployment statistics compiled in April this year. In Bridlington male unemployment stood at 11.7 per cent. Hull had 9.4 per cent., Scarborough 7.9 per cent. and the average for the whole of the country was 6.3 per cent. If we look at total unemployment, which is not so bad, we see that Bridlington is still worse off than the other areas. It has 9.2 per cent. compared with Hull's 7.9 per cent., Scarborough's 6.3 per cent. and a figure for the United Kingdom of 5.2 per cent.

What I think is even more perturbing is that the figures underestimate the total problem in Bridlington, for two reasons. First, a high proportion of the population is elderly. We have 22 per cent. of males over the age of 65 compared with the national average of 10 per cent. We have 30 per cent of females over the age of 65 compared with the national average of 16 per cent. Secondly, we have a relatively small proportion of young people in the population. This has been accentuated by a considerable outward migration because of lack of local job opportunities for school leavers and for young people of talent.

In the five years to 1971, over 5,000 people under the age of 29 left the area. This has kept the unemployment figures much lower than they would otherwise have been, but it means that a larger proportion of the population is non-productive and not earning a wage.

We also have an inward migration of older people. During that same five-year period, 2,000 people over the age of 60 moved into the area. These two trends taken together cannot be good for the social balance of my constituency. Also, the ageing population is increasingly becoming a burden that the town cannot carry.

Unemployment is particularly serious during the winter, as one would expect in a tourist resort. Although the summer rates are lower, they are still well above the national average. The Minister will probably say that Bridlington can now apply for grants for tourist development projects, but any jobs so created will do little, if anything, to help the winter unemployment problem.

Bridlington's basic difficulty is its poorly developed manufacturing base, with only 22 per cent. of jobs in that category, compared with a national average of 35 per cent. Too little manufacturing, coupled with tourist-based service industries, means a lack of stability and of suitable job opportunities for our young people.

We are fortunate in our progressive district council. Through its efforts, two industrial estates have been developed, at Bessingby and Carnaby airfield, the first of 49 acres, which is almost fully developed, and the second of 213 acres. There is still an area of 100 acres available. So there are sites available at this moment for manufacturing industry, with all the services and roads provided.

These two sites have to date provided 2,000 job opportunities, without which Bridlington's unemployment would be unthinkable. But despite that, despite an active promotional campaign of circularising hundreds of firms, developers and potential industrialists looking for new sites, and despite industrial exhibitions, advertisements and continual publicity of sites, since 1977 the fact that Bridlington has not had development area status has meant that the council's efforts have been virtually non-productive.

Development area status would enable Bridlington to compete on equal terms with Hull and Scarborough. Industrialists would then be eligible for 20 per cent. grants on plant and machinery, the grant of £1,000 per new job created and the regional employment premium.

At the moment, any industrialist inquiring at the Department of the Environment about sites for relocation is always directed to the development area, and projects in those areas are always given priority for EEC grants.

The figures make Bridlington's case unanswerable when compared with Hull and Scarborough.

It has been argued that the total figures of unemployed are not sufficient to warrant this change, but I am sure that the Minister will agree that 1,000 people unemployed in a community of 10,000 has as big an impact as 10,000 unemployed in a community of 100,000.

The figures that I have mentioned in a small community can be equally damaging to the local economy and have depressing effects on the local people. What matters is not the total of unemployed but the percentage. On that basis, I submit that Bridlington's case is proved.

All that we are asking for is justice and the ability to compete for industry on an equal footing with the adjoining areas that have development area status but lower rates of unemployment.

When Hull and Grimsby were given development area status, the case for Bridlington was overwhelming. People in the town considered that the reason why Bridlington was excluded was purely political. Hull is Labour to the core and needed aid. Bridlington is Conservative to the core, and could be left to the wolves. I am asking the Government to right the wrong committed by their predecessors.

I appreciate that this Government are revising all forms of industrial aid. I support their policy in reducing public expenditure, and particularly reducing the amount of Government money spent on subsidies and handouts to industry. There is, therefore, one alternative that I should welcome if the Government cannot see their way clear to giving Bridlington development area status, and that would be that the Government could decide to end the aided areas altogether and take development area status from everyone. I think that that would solve our problem, because Bridlington would then be able to compete on equal terms not only with Hull and Scarborough but with every other area in the country.

If, however, no action is taken and the present situation is allowed to continue, unemployment in Bridlington will not go down. It is now 85 per cent. above the national average for male unemployment, and it will probably move to nearly double the national average. Our young people will have to continue to leave the area to get jobs where they can use their ability, education and knowledge. I submit that that would be unjust in the extreme, and I am sure that my hon. Friend the Minister would not wish to be a party to such injustice.

10.47 p.m.

The Under-Secretary of State for Industry (Mr. David Mitchell)

I congratulate my hon. Friend the Member for Bridlington (Mr. Townend) on being the first Member in this Session of Parliament from any part of the United Kingdom to raise on the Adjournment the problem of unemployment among his constituents and to ask for changes in development area status on their behalf. His predecessor raised the same matter, and I hope that my hon. Friend will allow me, through him, to convey congratulations to Richard Wood on his peerage, following a distinguished career in this House. Richard Wood held many important offices while a Member of this place but, more important perhaps for many of us, he was a kind man and a friend to many.

I am grateful to my hon. Friend for outlining so fully the problems of Bridlington, with emphasis on the fact that unemployment there was over 9 per cent. in May this year. In fact, that represents 925 people out of work. Male unemployment was just over 11½ per cent. I accept that these figures are worrying and give cause for considerable concern.

Perhaps I should say that the number of unfilled vacancies in the area is not irrelevant, and at that time they numbered nearly 300. Those vacancies notified to the local Department of Employment office and careers office underestimate the total number of vacancies.

As my hon. Friend will know, many people do not notify vacancies to the offices of the Department of Employment. A crude approximation is that about one-third of genuine vacancies are notified. Therefore, the published figure of vacancies has to be multiplied between two and a half and three times.

Mr. John Townend

I accept that. However, does my hon. Friend agree that the proportion of vacancies to unemployment in Bridlington is not dissimilar to the proportion that one would expect to find in such an area?

Mr. Mitchell

There is a good deal of truth in what my hon. Friend says. However, there is a variation from one part of the country to another. There is not a blanket norm that may be applied automatically throughout. We must keep the figures in proportion. I accept and join with my hon. Friend in his concern about a level of unemployment that is not acceptable.

The Government are scrutinising regional industrial policy to ascertain the best way of promoting employment and assisting industry to commence its expansion, especially in areas that are hard hit. As part of the review, the present boundaries and gradings of assisted areas are being studied. Clearly that is a study that my hon. Friend is anxious to see occur.

I am sure that my hon. Friend will appreciate that at present I am unable to comment on specific requests for changes in assisted area status, such as the need for development area status for Bridlington. I do not think that he expected me to do so in advance of the completion of the general review.

There are criteria for designated assisted area status. When considering requests for changes in that status the Secretary of State for Industry has to have regard, as required by the Industry Act 1972, to all the circumstances in the area, actual and expected, including the state of employment and unemployment, population changes, migration and the objectives of regional policy. I take note of my hon. Friend's remarks about the somewhat curious circumstances in which Hull and Grimsby secured development area status.

The rationale on which regional policy is founded depends much on national economic circumstances. Regional policy is most successful in stimulating investment and employment in areas of high unemployment at times of general expansion in the economy when unemployment in other areas is not rising. I assure my hon. Friend that the Government are fully conscious of the need for an effective and continuing regional policy to help overcome the problems of areas of high and persistent unemployment and weak industrial structures.

My hon. Friend referred to the importance of tourism. He spoke about Bridling being "dominated" by the tourist trade. In many ways the tourist trade is more labour-intensive than is modern industry. I was most interested to learn of the way in which the district council has been indulging in self-help. I praise the way in which it has taken steps to assist itself. My hon. Friend mentioned two industrial estates that have been developed—Bessingby and Carnaby airfield—and the considerable number of jobs that have been created.

The Government regard as important the ways in which they can assist self-help to apply to small businesses, especially the provision of sites, so that they may start trading. Our policies are located on two main strands of thinking. First, we must pull down the hurdles that present themselves to those who are seeking to start new businesses.

Those hurdles are the role of legislation, the role of regulation and the burden of bureaucracy facing those who seek to start a business, whether they be the problems of planning consent at the beginning or of employment legislation later on. The Secretary of State for Employment announced that he proposed to amend two provisions of the Employment Protection Act in advance of any measures contained in his further review of the legislation. Those two measures, to lengthen the qualifying period for unfair dismissal and reduce the period of notice for small redundancies, will benefit small businesses. The Budget made a dramatic change in the incentives to people to start and expand businesses, and in so doing to create wealth for themselves and jobs for the district in which they are carrying on their activities, and to broaden the tax base, so creating wealth for the whole of the community.

I hope that my hon. Friend will accept that the growth of small business, with the starting up of hundreds and thousands more small businesses, is probably the most effective way in which we shall see the problems of unemployment tackled during the coming decade.

No single factor will affect the level of employment in Bridlington more than the changes that the Government will make in the climate of the economy and in creating incentives and the opportunities that people in Bridlington will have for self-help with the aid of their local authority, in the way described by my hon. Friend.

My hon. Friend referred to the way in which unemployment rose steeply after 1976. That happened because it took two years for the consequences of the policies of the newly elected Government of 1974 to work through. That did not apply only to Bridlington. Regrettably, unemployment rose as a result of those policies throughout the country. I assure him that the policies of the Government are based upon ensuring that when the effects of our policies have worked through the economy in two years, more jobs will be created in a more vigorous economy. I join him in hoping that Bridlington will share in that.

Question put and agreed to.

Adjourned accordingly at three minutes to Eleven o'clock.