TEXTILE INDUSTRY (FLINT) (Hansard, 9 July 1980)

§ Mr. Barry Jones (Flint, East)
There is a dark cloud over much of the British textile industry. The towns of Greenfield, Holywell, Bagillt and Flint already have 2,263 out of work.
When Courtaulds proposed that the giant Greenfield factory should have a five-week extended shutdown, my constituency realised that the going was getting tougher than ever. We already knew that the Deeside mill at Flint was fighting for its life, having suffered hundreds of redundancies this year. All of us remember the tragic closure of Castle mill, with 1,300 redundancies, in the late 1970s and the Aber mill, with nearly 2,000 workers at one time, which closed before that. At the post-war peak, Courtaulds employed 10,000 workers in my constituency. Today, only 1,800 workers are left
My friend Mr. Jackie Jones, a loyal Transport and General Workers Union convener, sums up the situation as follows: We are hammered by unfair competition. Mr. Randolph Evans, with a lifetime of work in textiles at the Deeside mill in Flint, says In Britain it is easier to import textiles into the United Kingdom than to export them. 721 Courtaulds' new chairman, Christopher Hogg, in his first annual report, for 1979–80, says: we feel that the balance is too heavily weighted in favour of those sending textile goods into this country and that not enough is being done to recognise the value to the economy of the industry here which has a more creditable record than most in terms of improving productivity". That is the new chairman of Courtaulds, speaking authoritatively on this issue.
For those of us who are seeking to lessen the flood of local redundancies, Mr. Hogg also makes the tough point: In view of the deteriorating trading conditions in recent months, we have not implemented fully the capital expenditure programme which was planned a year ago and priority has been given to tight control of working capital, including the extraction of capital from areas of business likely to be unprofitable in the foreseeable future. I think that those words are very ominous and the Government would do well to consider what the chairman of Courtaulds has said.
It will be no surprise that there is anger at Greenfield and at Flint. The work force and the management are pulling together, but they feel that the Government are letting them down. There is no doubt that they have made a fine success of labour relations. There has been a marked increase in productivity. There have been and there are plans for investment. There has been a great deal of modernisation. The work force has sacrificed many hundreds of jobs. But still, after all the sacrifices that the work force has made, there is a sense of crisis. Shop stewards ask me "What more can we do? We have given everything, but Government policy undermines the joint efforts of management and shop floor here at Greenfield and at Deeside."
Perhaps Mr. Hogg has described it best in the annual report: It does not seem wise in the longer term for the Government to pursue a policy of total laissez-faire towards industry if this means (as we think it does in textiles) an erosion of its competitive strength by a dangerous and unnecessary surrender of market position to those overseas competitors whose governments follow more nationally self-interested policies. That was said by the chairman of Courtaulds, one of the largest private enterprise companies in Britain. That is a very strong criticism of the silly and pointless policies of the present reactionary Government.
722 The work force who are engaged in textiles in my constituency say that this is a scandal. Only the Government can stop it, and only a conscious act of Government policy can put right a deplorable situation The Government's policy of a strong petropound is disastrous, because while our mills see their costs rise, their prices do not rise. There has been a 30 per cent. deterioration in the differential.
Currently, Greenfield has a £9 million investment programme. If it is completed—which is hoped—much of its effect for good will be eroded by the ill-effects of the strong pound. High interest rates mean that investment programmes are dearer than they should be.
The high cost of energy is also undermining our local effort to survive. In less than two years, at Greenfield energy costs rose from £3 million to £6½ million. The company rightly invested in equipment at the Greenfield factory to conserve energy, but still it is faced with this crippling burden. It is the view of the work force and myself that when a company attempts to meet the requirements of Government policy on energy conservation it should in some way be granted financial help.
In no way have the Cabinet stopped the flood of imported textiles, which is now the biggest problem. The Transport and General Workers Union is right to campaign for a tougher, more realistic defence of the industry. Imports from the United States directly threaten jobs at the Greenfield and Flint factories. The United States has exported to the United Kingdom large amounts of subsidised manmade fibres. The cheapness of the product has come from the large-scale nature of its production, and particularly, as my informants in the work force tell me with bitterness, from very low oil prices. The Americans' oil prices are subsidised. The cheapness also comes from low wages and low energy costs overall.
In our recession, as Britain's home market in fibres shrinks, the Americans have stepped up their penetration of it. Our Government were stupid and daft enough to permit that to happen.
I do not believe, nor do the work force or the management, that the present Government have got a satisfactory multi-fibre arrangement. My constituents 723 feel let down. They Say that Mediterranean countries, China and Warsaw Pact countries have also had a free ride on the backs of the textile workers in North-East Wales.
Local textile workers are hopping mad. They know that Government policies such as those that produced the strong pound and the high interest rates are destroying future jobs and imperilling those that exist. They know that 12,000 Courtaulds workers have been made redundant since September 1979. They are also aware that the company's profits this year are £68 million.
Mr. John Griffiths, who lives in my constituency, operates from Flint and, who is the Transport and General Workers Union officer, is right to tell me that enough is enough.
In the time that remains available to me, I should look ahead and tell the Government where they should act with decision, urgency and effect. Steps should be taken to protect the industry. There should be a complete review of textile and clothing imports. If the EEC remains incapable of defending United Kingdom industry, unilateral action by the United Kingdom, either through stiffer tariffs or tighter quotas, will be the only alternative to higher unemployment and the longterm eclipse of the entire industry.
Further action must be taken immediately against United States man-made fibre imports. In general, the level of imports should be related to the United Kingdom market. If the domestic market contracts, so should imports. There is every indication that our home market is shrinking and will continue to shrink. In a recent publication, Marks and Spencer indicated that that is its view.
The special arrangements with other countries, especially with the Mediterranean associates of the EEC, must be renegotiated. That is important, because before long the EEC will be expanded by the membership of Greece, Spain and Portugal. Some quotas will thus be freed.
Outward processing must take place within normal quotas. Much cheating is taking place. Materials are being imported into the Common Market, made up, and put into Britain through, as it were, the back door. They are destroy- 724 ing hundreds of jobs. It is not fair and it should be stopped.
Supplying countries should be monitored for their compliance with the rules of the International Labour Organisation on working conditions and trade recognition. All textile and clothing imports should be properly and constantly monitored. Measures must be taken to prevent bunching on imports, which can have serious short-term effects on domestic firms. Similarly, under-used quotas should not be carried over into the next period. I want to hear the views of the Under-Secretary of State on that issue. I shall press him hard. I hope that his brief is sufficiently detailed for him to answer that question. It is one of the simplest that I have put.
Full consultation would ensure the most effective decisions on investment timing, location and changed working practices. Companies should be persuaded to invest in the United Kingdom and not overseas. As North Sea oil revenues mount, there is a real chance to use them in a properly planned way through a special fund to secure investment in industries that are in difficulties, such as the textile and clothing industries. Investment in new plant and machinery is the only long-term way forward. That is the way to secure existing jobs.
I turn to the question of avoiding closures. We have had enough of those. There are more ahead if urgent action by the Government is not forthcoming. If companies warn of their deteriorating position soon enough, the ultimate disaster of closure may be avoided. Nothing is worse for the workers concerned, or for the company, than sudden announcements of widespread redundancy.
I remember when the Castle mill at Flint was declared closed by the company. Cabinet Ministers were not even given 24 hours' notice of 1,400 redundancies. That was a scandal. A joint approach to the problem must be maintained. If shorter hours are worked sometimes, employment can be spread.
On the question of technological change, I believe that full participation by the work force in decisions on new equipment before it was introduced would speed its introduction and ensure its maximum efficiency.
725 I am not talking about lame ducks in my constituency. This local industry has a very good track record, as has the national textile industry. Already 8,000 people in my constituency are looking for work, and I do not want to see a single extra textile worker added to the dole queue there. I want to be told where these people will get new jobs. Many of them have given years of loyal service.
Tonight, with all the force that I can muster, I call for an urgent change in Government policy. I hope that the Minister has come here tonight to tell us of that. The Secretary of State for Wales must fight like a tiger in the Cabinet for a changed policy.
To sum up, one should always consult the work force. Participation and negotiation should be the watchwords. Companies should invest more and more to safeguard the future, and unfair and excessive imports should be stopped. In my constituency the closure at Shotton steelworks—the biggest closure in Western Europe—meant a record-breaking 6,000 redundancies between Christmas and Easter. That has totally undermined the constituency's economy and that of the region as well. The textile workers of my constituency have never been given the credit due to them. When made redundant, they have never received large redundancy payments. If our textile mills close, the hone of ever reconstructing our local economy will be dashed to the ground.
Flint has a 36 per cent. rate of male unemployment. Holywell and Greenfield, similarly, are under great pressure. The Minister must urgently locate a major new industry in my constituency. The textile industry, now in desperate straits, is suffering directly because of the Tory Government's economic policies. British manufacturing industry is facing a horrendous succession of closures, lay-offs and short-time working.
If the Government refuse to change their policies there will be mass unemployment, a ruined textile industry and a ruined British industrial presence. When the recession ends, our oil money will be tragically wasted by buying foreign-manufactured goods because our own industry will have closed down. There will be more imports in the years ahead than ever before.
726 This Government are digging a deep pit in which to bury Britain's manufacturing industry. They must change their policies, and Ministers in the Welsh Office must play their part in trying to bring sanity to policies and in giving urgent and immediate help to the textile workers.

§ The Under-Secretary of State for Wales (Mr. Wyn Roberts)
The hon. Member for Flint, East (Mr. Jones) has raised this subject on a number of occasions, most recently during Prime Minister's Question Time yesterday. I give him a firm assurance that my right hon. Friend the Secretary of State for Wales is fully aware of the current employment difficulties in Flint and North-East Wales generally.
The latest job losses in the textile industry in the hon. Gentleman's constituency come at a difficult time, and on top of the ending of steel making at Shotton, with the loss of about 6,000 jobs. The current unemployment levels in the Shotton travel-to-work area reflect the seriousness of the situation, at 14.5 per cent. overall and 15.8 per cent. for men.
I do not dispute the difficulty of the situation, but the hon. Gentleman detracts from his case by quoting, as he has done outside the House, male unemployment figures of more than 30 per cent. for the town of Flint. He must be aware that it is meaningless to quote unemployment rates for Flint alone. Unemployment rates measure the supply of labour in relation to the jobs available and that can be done only by looking at the whole of the job market, in this case the Shotton travel-to-work area.
The prospects of the area are not as bleak as the hon. Member would have us believe. The area is strategically well situated for the main markets in the United Kingdom; the highest levels of assistance are available to incoming industry and to firms that are expanding; the WDA is carrying out an extensive programme of site preparation and factory building; and the work force has an excellent reputation.
On the basis of projects in the manufacturing industry which are receiving Government assistance or have been allocated a Government factory it is known that there are 1,700 jobs in the pipeline for the Shotton area, and 727 another 1,775 expected to arise from projects in the Wrexham area. Even without taking into account the other employment created by these projects or jobs created in other projects it is clear that there is a sound basis for new economic growth in the area. In the textile industry, there was welcome news recently of investment by British Celanese in its works at Wrexham, which will improve productivity and safeguard employment.
I should like to return in more detail later to the measures that we are taking to generate new economic growth on Deeside, but the hon. Member raised a number of points specifically related to the textile industry. I share his concern about the decline in the industry in North-East Wales—a decline that is being seen in the industry throughout the country. There has been a contraction in employment in the industry for some years, as he indicated, and this has accelerated recently. In Wales alone, more than 3,000 jobs have been lost in the industry in the last three years—as many as in the previous 10 years. The increased competition that the industry generally has faced from overseas is undoubtedly a factor, which the hon. Gentleman acknowledged. The industry, of course, has to decide on how best to respond to that situation.
The Government, for their part, acknowledge that they have an important role to play. We do not believe in a policy of laissez-faire in this context. There is already a comprehensive set of controls on imports of textiles from low-cost sources under the GATT multifibre arrangements. We have more than 400 quotas on imports from well over 30 low-cost supplying countries.
As my right hon. Friend told the hon. Member recently, we are committed to ensuring that the Community's multifibre arrangements are implemented as efficiently and quickly as possible. We have also said that we are determined that the arrangements to succeed the current MFA when it expires next year will be tough and effective. I can give the hon. Gentleman an assurance on that point.
In addition, controls have been introduced over certain imports of synthetic fibres from some developed countries, including the United States, and we have 728 made it clear that we will seek Community agreement to further restrictions on synthetic textile products where those would be justified under the GATT rules. However, a widespread extension of import controls would undoubtedly give rise to retaliatory action against our exports generally—with the result that even more jobs would be put at risk. We export nearly one-third of everything that we produce in Britain, a proportion that is well over twice as large as that of Japan. In the textile industry alone, excluding the clothing industry, exports last year stood at over £1,500 million. The importance of our export trade to the economy is enormous.
The hon. Gentleman also raised the issue of the effects of the current high rates of interest and the strength of sterling on the industry. I assure him that the current rates of interest will be maintained only as long as is necessary to ensure that the trend in monetary growth is maintained in line with our targets. The cuts that have been announced in public spending and borrowing are designed to make it possible to achieve those monetary targets and to return to lower interest rates. The reduction in minimum lending rate last week will be of some help to industry, but to reduce interest rates too much too soon would risk undermining our policy to control inflation. As for the exchange rate, the hon. Gentleman will appreciate that it is the market and not the Government that primarily determines its level, and that interest rates are only one of the factors affecting the market.
I am convinced that the greatest service that we can do for the textile industry, and for industry generally, is to bring inflation under control and to create an efficient and competitive economy, and I assure the hon. Gentleman that within the framework of our economic policy and our international obligations the Government are committed to doing all that they can to help the textile industry.

§ Mr. K. J. Woolmer (Batley and Morley)
Does the hon. Gentleman agree that recently published figures on bankruptcies show that the textile industry has had a record number of closures and that the number of closures has doubled in the last 12 months? Does he not accept that there is more than one closure a 729 day? How can the Government's monetarist policies be assisting the textile industry when they are manifestly decimating it? How can they assist it, given that a textile mill closes every day?

§ Mr. Roberts
I have already explained our stance on monetarist policies. Our objectives are long-term. I have already noted the problems facing the textile industry. One of the greatest problems is increased competition from abroad. I am sure that my colleagues will study the hon. Gentleman's points.

§ Mr. Keith Best (Anglesey)
rose—

§ Mr. Roberts
I should like to refer to the difficulties of getting new jobs in the Shotton area. We are very much alive to the difficulties, and I remind the hon. Member of the action that we have taken to alleviate the problems. The Shotton travel-to-work area was upgraded to special development area status last December, which means that it has the full range of Government assistance 730 available, at the highest rates, to attract new jobs and safeguard existing employment.
Substantial additional resources, amounting to £15 million over the next three to four years, are being made available to the WDA, for a programme of industrial site preparation and factory building. Under this programme about ½ million sq. ft. of factory space is under construction or planned to start in this financial year in the Shotton and Wrexham areas. In addition, the new programme of construction that my right hon. Friend announced last week provides for a start this year on a further 220,000 sq. ft. of factory space in these areas—