UNEMPLOYMENT

HC Deb 25 June 1980 vol 987 cc487-621 3.56 pm

Mr. Bruce Milan (Glasgow, Craigton)

I beg to move, That this House calls for urgent action by the Government to reverse the appalling rise in unemployment due to the failure of the Government's industrial and economic policies with its particularly disastrous consequences for school leavers, young people and the disadvantaged. This debate takes place against the background of the unemployment figures issued yesterday. These, as I hope the Government recognise, have led to an explosion of anger, concern and anxiety as the consequences of Government policy come home to the people of this country. I very much hope that as a result of that anxiety and anger, as well as what will be said in the House today, about these appalling unemployment figures the Government will take heed before it is too late and before the continuation of current policies results in complete disaster for our economy and industry.

The theme that I want to develop this afternoon—the main point that I want to make—is that if yesterday's figures are tragic, the figures as they will appear over the next few months and years will be considerably worse. That is absolutely inevitable, given the trend which has already been established. Secondly, these worsening unemployment figures are a deliberate and inevitable consequence of Government policies. They have not arisen as a side effect of, or as incidental to, the main thrust of Government economic policies. They are inevitable, and were inevitable right from the start when the Government adopted their present monetary policies.

The Government are deliberately trying to squeeze inflation out of the economy—I shall return to this later—by reducing output and increasing unemployment. What we saw yesterday is only the start of a process which will get worse as the months and years pass. It is no use the Government, either in their amendment or in anything else, expressing concern about a rate of unemployment which they have deliberately created. If, in their economic policies, the Government go back to the policies of the 1930s, inevitably we shall have unemployment on the scale of the 1930s. Yesterday's figures represent a start of that process.

I need not spend a great deal of time on the figures themselves, because they have already received considerable publicity today. At 1.66 million, the figure is the highest since the war. Even seasonally adjusted, at 1.54 million it is still the highest since the war. The increase during the past month in seasonally adjusted figures—and I am not talking about the crude increase of 150,000, which is a complete disaster—was 51,000, which is an accelerating increase over the increases of the past six months, which have added, on a seasonally adjusted basis, no less than 230,000 to the unemployment figures.

If the general figures are bad, the figure for school leavers is even worse. It now stands at 187,000. an increase of more than 137,000 in one month. Yet that figure has not reached its peak for the current year, because the inevitable large increase in July will take the figure to more than 250,000. That is absolutely inevitable. In addition, the school leavers will not be absorbed over the coming months on anything like the scale to which we have become accustomed in recent years. As the economy deteriorates there will be increasing difficulty in absorbing those school leavers over the next few months.

The Scottish figure has risen by a disastrous 26,000 in one month, to 223,000—the worst Scottish figure since the war. That is a reflection of the fact that because the school leaving age is earlier in Scotland the full impact of youth unemployment has already expressed itself. What is true for Scotland this month will be true for England and Wales next month. The figures are a tragedy for youngsters. They are a tragedy especially for the least qualified youngsters who leave school with little in the way of academic qualifications. The most disadvantaged people are worst hit by the unemployment figures.

Mr. Eric S. Heffer (Liverpool, Walton)

Does my right hon. Friend agree that today's statement by the Minister of State, Civil Service Department, means that qualified youngsters who will not now have the opportunity to join the Civil Service will be badly affected?

Mr. Millan

I agree with my hon. Friend. I had intended to make that point later in my speech. The cuts in public expenditure, whether in the Civil Service or elsewhere, are now worsening seriously the general unemployment position, not least among school leavers and youngsters generally. Particular groups of school leavers—especially those with the least qualifications and the ethnic minorities—will be badly hit.

Some interesting statistics given in answer to a recent question by one of my hon. Friends show that, whereas the general unemployment in the past year had risen by 16 per cent., the increase in the, number of unemployed among ethnic minority workers had risen by no less than 26 per cent. As well as those in black communities, disadvantages are being suffered by the disabled and by other disadvantaged groups in the community.

No doubt the Minister, when he replies, will tell us that unemployment increased under the previous Labour Administration. I acknowledge and regret that fact. It increased substantially. But the position today is much worse than anything which obtained under the Labour Government. I remind the House that in the last 18 months of the Labour Government unemployment was reducing gradually—too slowly, in my view—and that that trend continued after the election until September of last year, when the Conservative Government's policies began to bite. The trend was reversed, and unemployment began to rise again—first of all, slowly, but now at an accelerating pace.

The problem is already on a more serious and larger scale than any thing under the Labour Government. I shall come to forecasts in a moment, but I believe that the unemployment figures will become very much worse before they get better. More important, for the first time in Britain since the war the Government have deliberately abandoned full employment as a policy. That is what the Government have done over the past year.

We can take our pick from a variety of forecasts from independent bodies of all sorts—some with considerable repu tations for accurate forecasting, and some with less considerable reputations. For example, there are the London Business School, the National Institute of Economic and Social Research, the Independent Treasury Economic Model and many more. Every outside body estimates that over the next two or three years unemployment will rise considerably. Only a month ago talk of 2 million unemployed by the beginning of next year was pooh-poohed by the Government, who said that it would not happen and that it was scare talk. Now the Government do not even bother to deny that, even on their figures, unemployment, will be more than 2 million by the beginning of next year. If they deny that, I hope that they will say so this afternoon and give chapter and verse for their denial. The Government know that unemployment will be more than 2 million, at the very least, by the beginning of next year. The latest forecast from ITEM shows that by 1983 unemployment in Britain will be no less than 3 million. That forecast was buttressed by many substantial and convincing arguments.

The Prime Minister, when answering questions yesterday, talked about a short-term problem and a short-term increase in the figures. We are entitled to ask how long is short-term. What do the Government mean by short-term unemployment problems? No outside forecast predicts anything other than that these serious unemployment figures will continue for at least two or three years, and that unless there are changes in Government policy they will continue for longer than that. It does not give any comfort to the unemployed youngsters to be told that it is simply a short-term unemployment problem when it is likely to continue for two or three years or a good deal longer than that. If that is not the position, perhaps the Minister will tell us the definition of short-term. Is it six months, one year, two years, three years or five years? We are entitled to know the Government definition of short-term.

What is the Government's forecast of unemployment? Will we be told that today? When will the figures begin to improve? At what point will they be so unacceptable—even to this Government—that there will be a change of policy? The House is entitled to have those questions answered by the Minister today.

Mr. John Gorst (Hendon, North)

I am sure that the right hon. Gentleman wishes to be fair, and he was fair when he referred to the decline in unemployment after the general election. Will he bear in mind that, while the Manpower Services Commission was preparing its forecast for 1981 it was writing in a probable figure of 1.9 million? That must have been based not upon present Government policies but upon the results of the previous Labour Administration.

Mr. Millan

I shall come to the Manpower Services Commission review, published only a month ago, later in my speech. It makes interesting reading. It is incredibly damaging to the Government's policies.

We should have some answers to those questions. I do not expect to get answers from the Secretary of State for Scotland, as he never answers any questions by hon. Members from Scottish constituencies. We know that the Chancellor of the Exchequer does not give any forecasts because he does not believe in them. With the sort of forecasts being published at present, I can understand why he does not want to believe in them. The right hon. and learned Gentleman does not listen to anyone. He does not listen to advice from outside or anywhere else. We had plenty of experience of the Chancellor in another incarnation on the Industrial Relations Act. We know the havoc that he created in industrial relations by not listening to advice. Now he is being allowed to create even greater havoc and disruption in a wider area of economic policy.

The Secretary of State for Industry does not believe the unemployment figures. He thinks that they are a myth and that people are not unemployed at all. He ought to tell that to the extra 150,000 who have joined the dole queues in the last month.

The Secretary of State for Employment used to be very scathing about the unemployment figures under the Labour Government, but he is now presiding over the biggest unemployment disaster since the 1930s, and he knows that it will get worse. If he had any conscience, he would resign from this Government, because we are told that he does not believe in their policies. I would respect him for that at least. However, that is what he is presiding over at the moment.

Suppose we get an improvement.

Mr. Tony Marlow (Northampton, North)

rose—

Mr. Millan

What will be left of our industry when the upturn comes, if it ever comes? What will be left of our manufacturing industry? The costs of unemployment are horrific in terms of our economy. That point hardly needs underlining.

There used to be a comfortable little theory that if only one went downhill a bit, that put one in a better position for taking off again—the springboard theory of unemployment or decline. It was all just a question of shaking out unproductive elements in the economy. I never believed those theories, and I certainly do not believe them now. This is far more than a shake-out and a decline for a subsequent take-off. In terms of productivity, what is happening now is absolutely disastrous. The conditions in which we get productivity improvements are certainly not conditions in which we have an accelerating decline in employment and an accelerating increase in unemployment. The consequences for our industry, to which I shall come in more detail later, are absolutely disastrous.

There are other consequences as well. There is the consequence for public expenditure. One of the Government's main aims is to reduce the public sector borrowing requirement. But unemployment benefit is now adding massively to the PSBR and is therefore encouraging the Government, in the perversity of their monetary policies, to cut back even further, causing more unemployment, whether in the Civil Service or elsewhere, and again adding to the vicious circle of increased public expenditure.

Apart from that, there is the effect on the individuals who are now being put on the dole. I think that it is true to say that all of us on both sides of the House have in recent years been too complacent about the effect of unemployment on the individual. But there is now a feeling of bitterness and despair among many of our unemployed, particularly the young unemployed, which can be disastrous for the social health of this country. I do not normally suggest that high rates of unemployment will inevitably lead to social unrest, but I believe that in certain sections of the community we are beginning to see such signs. The quickest and most decisive way of adding to that bitterness is what the Government are doing about unemployment benefit this year.

We know that many Conservative Members think that a large percentage of the unemployed are scroungers. We have had another 150,000 scroungers added to the total in the last month. What the Government are doing on unemployment benefit reflects that situation. In the current year they are deliberately cutting the real value of unemployment benefit. That has not happened since 1930. The increase of 11½ per cent. this year compared with an inflation rate of 22 per cent. is a deliberate attack on the living standards of the unemployed. I believe that as the effects of that attack on their living standards becomes evident during the winter months, it will lead to a considerable increase in anger and bitterness.

Mr. John Bruce-Gardyne (Knutsford)

I listened with care to what the right hon. Gentleman said on this point. He will recall that during the period 1976–77, under the Labour Government, there was a substantial fall in the real earning power of those in employment at a time when he might be entitled to say that the compensation of those who were out of employment was sustained against the going rate of inflation. Is he saying that it is preferable that the remuneration of those in employment should fall behind the compensation of those who are out of employment?

Mr. Millan

I am saying that if there are savings to be made, they should not be made at the expense of those least able to defend themselves. I remind the hon. Gentleman that it is not only unemployment benefit that is being cut. Sickness benefit is being cut by the Government in November this year.

Why are we in this parlous condition? We are now getting the excuse of world conditions. But, because of North sea oil, we are in an almost uniquely advantageous position compared with our industrial competitors in the Western world to deal with the difficult world economic situation. Yet, despite that, we are already doing worse than the rest of them, and we shall do worse still.

The reason why we are in this position is the Government's monetary policy. I repeat, they are squeezing out inflation by reducing output and employment. Yet, ironically, what is the Government's record on inflation? They inherited an 8 per cent. rate and pushed it up to 22 per cent. within a year, mostly by Government-induced inflation by increasing VAT, gas and electricity prices, imposing higher rents on council house tenants and cheating the local authorities out of the moneys to which they were entitled, thereby encouraging the highest rate increases that we have had for many years. These have been the direct inflationary consequences of the Government's policy.

Interest rates—another aspect of the Government's monetary policy—are adding to inflation and, incidentally, like the increased costs of unemployment benefit, adding substantially to the public sector borrowing requirement.

The effect of this policy is that sterling, in terms of our industrial strength, particularly because of interest rates and the consequences of North Sea oil, is overvalued against the currencies of our main industrial competitors. With that disastrous combination for our manufacturing industry, and particularly for our exporters, it is no wonder that we are now facing ruinous consequences in terms of reduced output and employment.

It is no use the Government attempting, as they are now doing, to blame it all on wages. The Government were elected on the basis that we did not need an incomes policy; that all we needed were a few simple monetary mechanisms and everything else—wages, incomes and the rest—would work out simply and satisfactorily. The Government were elected after a period in which, as the then Opposition, they had obstructed any attempt by the Labour Government to get a genuine understanding about wages and incomes.

The Government were elected on the basis that they did not want to talk to the TUC. They snubbed the TUC. They did not want to co-operate with the TUC or individual trade unions. If the Government want understandings on wages, incomes or anything else, they will have to be willing to discuss with the TUC and the unions generally a good deal more than wages. They will have to discuss the whole management of the economy. If, with the kind of policies that they are carrying out at the moment, they expect to get co-operation from the trade unions, they are suffering from a grand delusion.

The effect of Government policy on industry is devastating. The output figures are already going down disastrously. The redundancy figures announced yesterday by the Department of Employment show an increase of 100 per cent. over last year. The Secretary of State for Employment might care to note that I asked for the figures in a parliamentary question on Monday and received a temporising answer. The figures were issued to the press yesterday in a verbal briefing by the Department of Employment. I am grateful for them because they show that in the first five months of this year redundancies totalled 150,000 compared with only 67,000 in the same period last year. There are now so many closures that they hardly rate a mention in the newspapers.

As the Financial Times said the other day, there is a "rising tide of bankruptcies". The figures show a substantial increase in bankruptcies over the last year. Significantly, there are many bankruptcies in manufacturing industry. On the last occasion that there were bankruptcies, they took place mainly in the property market. Now they are occuring in the manufacturing sector. I have no doubt that it will be a great comfort to the heads of small firms who voted Conservative at the last election that among the bankruptcies are the small firms which the Government said they would protect under their new policies. There is no way of protecting small firms under present policies. They are suffering even more than the rest of the economy.

In the experience of my hon. Friends, there is a mood of despair in industry. The newspapers are now talking openly of a slump. They are using not the word "recession" but the more accurate word "slump". That mood of despair has become deeper and gloomier in the last few months.

Even the CBI, which has kept up a facade of support for Government policy, is extremely worried about what is happening. Its chairman recently attended a meeting of the Conservative Back Bench industry group. He said that for many members the problem was one of short-term survival. Government Members know that industry is in a mood of despair.

The chairman of the CBI in Scotland, Mr. Nickson, said the other day: Interest rates have to come down by a significant amount at the earliest opportunity. We want the Government to err on the side of sooner rather than later. The chairman of the Scottish Development Agency, Mr. Duthie, who was appointed by the present Secretary of State for Scotland, hit out at Tory policy the other day. He said: The time has come to relax the Governments monetary policies. We have gone far enough down that road. Opposition Members will say "Hear, hear" to that.

Mr. Balfour, the managing director of Scottish and Newcastle Breweries and chairman of the Scottish Council, said the other day that there must be a change in Government policy. Lord Weir, whose company, Weir's of Cathcart, is one of the best engineering companies in Scotland, says that his company is suffering from over-valued sterling and high interest rates. It has recently had to lay off substantial numbers of workers. Lord Weir was one of the foremost supporters of the Government at the last election. However, he is calling for a halt to and change in Government policy.

The rot among Government supporters has gone so far that even The Sun newspaper, under its newly knighted editor, Sir Albert Lamb, carried a special survey called "Britain in the Dole-drums." I noticed a slight change in mood today. Perhaps Sir Albert had one of his famous chats with the Prime Minister yesterday.

A much more cheerful article appears in The Sun today. It was called The School Leavers' Jobs Guide. It gives the following advice to young people: don't just sit there and moan about it. Do something, even if it is only a short-term measure. There are plenty of temporary jobs for a bright teenager. They are fun, get you out and about, and will give your confidence a boost. That was followed by many helpful suggestions, all, of course, full of fun. One example was entitled: Be Busy on the Beach. It reads: You do like to be beside the seaside? Why not become a deckchair attendant or litter collector? Or you could help with the donkey rides—it doesn't pay a fortune but it gives a lot of pleasure. That is from the Prime Minister's favourite newspaper. Now we know the prescription for putting British industry back on its feet—helping with the donkey rides.

We need urgent action on a wide front and on a number of particular issues. First, the Government must abandon their obsession with monetary policy and with artificial figures for PSBR. There is an overwhelming case for an immediate reduction in interest rates. That by itself would have a significant effect on sterling and would help to make our industry more competitive.

If the Government wanted to reduce inflationary pressure, they could follow the advice that the Leader of the Opposition gave yesterday about reversing the increase in VAT and the Government-directed increase in gas prices. There are a number of other areas in which the Government, by their own actions, can reverse some of the disastrous inflationary aspects in the economy which result from their policies.

Whatever is done now in terms of reversing policies, unemployment will become worse and worse over at least the next year and probably for considerably longer. Every day's delay makes the situation worse and means that the slump will continue for even longer.

A number of other actions should be taken. The Government should abandon their farcical policy of non-intervention in industry. It is not even non-interventionist, as we saw during the steel dispute and, more recently, during the farcical Ferranti episode, when jobs were prejudiced because of the Government's doctrinaire policy.

There must be a loosening of the criteria for section 7 and section 8 assistance instead of the tightening up by the Government in the last year. Industries such as the textile industry require urgent action, not in weeks or months, but now. That action is already overdue. The Government must remove the shackles from the National Enterprise Board and reverse the unbelievable cuts in the Scottish Development Agency budget. One of the first things that the Government did was to cut expenditure on one of the most hopeful aspects of Scottish industry. The same happened to the Welsh Development Agency. The agencies need more power and money, not less.

There must be a reversal of last July's regional policy cuts. The areas that will suffer most as employment levels deteriorate further are those with traditionally high unemployment, yet last year the Government cut regional aid. The sum of £45 million out of £150 million in Scotland was cut in order to save money and to reduce the impact on the PSBR.

There must be a reversal of public expenditure policies. The Civil Service was mentioned earlier, but that is only one example. Government cuts in public expenditure are adding directly and inevitably to the unemployment figures. There was a myth that local authority expenditure could be cut, leaving the capital programme intact and that everything could be done on the revenue programme. That is utter nonsense. It has been proved to be so with the housing programme. That is to be cut in the next few years by nearly 50 per cent. The effect on the construction industry will be disastrous. That industry contributed a lot of money to the Tory Party coffers at the last general election.

The pay-off for the construction industry is the worst prospect since the end of the war. That is only one of the industries that is suffering from cuts in public expenditure.

There should also be an increase in the budget of the Manpower Services Commission. It is hardly credible that the Government should cut its budget at a time of such high unemployment. The planned expenditure for 1979–80 has been cut by £114 million. Planned expenditure for the current year has been cut by £140 million, and for 1983–84 the cuts may total as much as £207 million. The Manpower Services Commission recently published the "Manpower Review 1980". It states: We will be unable to meet the demands on some of our major services at a level we consider necessary. Its budgets have been cut and its manpower has been cut in the interests of doctrinaire monetarist policies. The work of the Manpower Services Commission should be extended. Many of its programmes, such as STEP, have been cut.

Mr. Nigel Forman (Carshalton)

Conservative Members recognise that the Manpower Services Commission has an important role to play in alleviating some of the problems. However, does the right hon. Gentleman realise that in paragraph 117 the Manpower Services Commission states that the generation of permanent new jobs is outside the power of the commission?

Mr. Millan

I agree. Far from generating new jobs, the Government have increased unemployment. As a result, we must look to the Manpower Services Commission to provide, in many cases, palliatives. If changes are not made in the economy, the Manpower Services Commission will require an increased budget to do the job that the Government should be doing.

The Secretary of State for Employment is boastful and confident about the youth opportunities programme. Indeed, it is mentioned in the Government's amendment. He is very proud that the Government have maintained the number of places. If I were him, I would not be so complacent. We need many more places to deal with increasing youth unemployment. Youth unemployment will inevitably rise over the next two or three years.

The Manpower Services Commission's review is interesting. Although the number of places have been maintained, page 28 shows that provision in later years will represent a significant cut in the youth opportunities programme. The figures are given in the commission's report for 1980. Althought at present there is provision for 100,000 to 105,000 places, that number will be cut to 80,000 or 85,000. Those cuts in the programme are a direct result of the cuts in the budget of the MSC.

If the Secretary of State for unemployment is so anxious about the youth opportunities programme, he should give a simple pledge. Perhaps he will pledge that the number of cases provided under the youth opportunities programme will be considerably increased every year until they reach a level that the Manpower Services Commission recognises as adequate to deal with the increasingly seri ous problem of youth unemployment That would be a simple pledge. I hope that a Minister will give it.

The Government made an incredible decision, in their announcement on 14 February, to cut back the job release scheme. That scheme takes the elderly out of employment on the ground that their jobs will be filled by those who are on the unemployment register. Such a scheme represents a major contribution to solving the problems of the long-term unemployed and of young school leavers. It is vital that we should use whatever measures are necessary to tackle the youth unemployment. The job release scheme gave favourable terms to those who retired. Despite that, the Secretary of State for Employment has decided to cut it. The eligible age for males is being cut from 62 years to 64 years. As a result, perhaps 40,000 people will remain on the unemployment register.

When he made that statement, the Secretary of State said that the job release scheme was the most cost-effective scheme that we had. If so, why in heaven's name is the programme being cut? The programme could make a major contribution towards solving youth unemployment. Apart from the major policy changes that we seek, we hope that we shall be given some encouragement to believe that the job release scheme will at least be reconstituted to the scheme that the Government inherited from the Labour Government.

At the last election, the electorate was promised tax cuts and cuts in inflation. The Conservative manifesto and Conservative candidates said that there was something for everyone. The electorate is now witnessing the reality of Tory policy. The reality is completely different from the land of unequalled opportunities that the Tory Party promised at the last general election. The tax cuts have gone sour, because they have been eaten up by increasing inflation. The Government cannot afford to make further significant tax cuts unless it is to those who earn salaries of £20,000 or £25,000 a year. If one does not earn such a salary, one will stand to lose more as a result of the general increase in indirect taxation than might have been gained from the reduction in direct taxation that was announced in the Chancellor's Budget. Instead, we are faced by rip-roaring inflation, and massive and increasing unemployment.

The message to the Government is simple. Their policies have failed, and the outlook is grim if they continue with such policies. That is why we call upon the Government to abandon their disastrous policies before they do irreversible damage to British industry and to the economy.

Mr. Deputy Speaker (Mr. Bernard Weatherill)

I should tell the House that Mr. Speaker has selected the amendment in the name of the Prime Minister.

4.38 pm

The Secretary of State for Scotland (Mr. George Younger)

I beg to move, to leave out from "That to the end of the Question and to add instead thereof: 'this House shares the concern at the rise in unemployment but recognises that in the face of many years of industrial weakness and the development of a world recession there is no quick solution; approves the actions of Her Majesty's Government in concentrating assistance in the area of greatest need and in increasing the size of the youth opportunities programme; confirms its support for the present policies designed to reduce inflation and urges all concerned to minimise unemployment by moderating the level of wage settlements.'. The House will share the concern that the right hon. Member for Glasgow, Craigton (Mr. Millan) has expressed about the unemployment figures. The House will also welcome the opportunity to debate these problems, their causes, what the Government are doing and what can be done to help. The right hon. Gentleman is an extremely appropriate person to open the debate. He has an extensive knowledge of this subject. He is particularly appropriate, because of his record when he was in office. Indeed, he seemed to be suffering from a certain degree of amnesia today. I therefore wish to make a few comments that I hope will put the record straight.

The right hon. Gentleman took the Government to task—and me as well—time and again for our insistence upon the priority of squeezing inflation from the system. I do not know whether he thinks that that is no longer a priority, or whether he is against the aim of squeezing inflation from the system. I remind him that the phrase "squeezing inflation from the system" is not mine, nor was it originally the phrase of my right hon. Friend the Prime Minister. It originated from the Leader of the Opposition, who said on 25 January 1977: As long as we are trying to squeeze inflation out of the economy, this is unfortunately one of the consequences that we must face".—[Official Report, 25 January 1977; Vol. 924, c. 1169.] One of the consequences to which he was referring was unemployment.

The right hon. Member for Craigton knows all about this. If we are talking about the first year of a Government in office, he knows about it because he was a member of the Government who came to office in 1974. He knows that the increase in unemployment in that year was greater than the increase in the past year. Between May 1974 and May 1975 there was an increase of 23.9 per cent. in Scotland compared with an increase between May 1979 and May 1980 of 18.7 per cent. The increase in the whole of Great Britain was 51.9 per cent. in 1974–75, and 16.4 per cent. in 1979–80. I quote these figures not because I do not take seriously the question of unemployment but because I believe that the right hon. Gentleman's remarks would have carried a great deal more weight if he had acknowledged those facts more openly.

The right hon. Gentleman referred to the June unemployment figures. I share his concern about them. But I remind him of his words in the House on 4 July 1977, when he said: The Government are very concerned about the present level of unemployment. I have never disguised my view that it is unacceptably high. The figure for the month of June, in particular, was disappointing. It was very much affected by the influx of summer school leavers, who leave school rather earlier in Scotland than they used to do. But the figures would have been very much worse had it not been for the special measures that the Government have introduced to alleviate the worst experiences of those—particularly young people—who are unable to get jobs in the present difficult time."—[Official Report, 4 July 1977; Vol. 934, c. 900.] Perhaps the right hon. Gentleman would recall those words.

Mr. Dennis Skinner (Bolsover)

Stop playing Tweedledum and Tweedledee.

Mr. Younger

A few minutes ago the right hon. Gentleman poured scorn on the idea that foreign comparisons had any relevance. I remind him again of his words in a Scottish Estimates debate on 27 June 1978, when he said: I will not spend any time dealing with the general international background but it is, nevertheless, true that the general state of world trade and lack of world recovery is the most important and serious factor against which any kind of policy for economic expansion in this country has to operate."—[Official Report, Scottish Grand Committee, 27 June 1978; c. 15.] That puts the right hon. Gentleman's remarks in perspective.

Mr. David Ennals (Norwich, North)

Before the Minister finishes his series of quotations and gets on with his own speech, will he answer one question? He talks about squeezing inflation out of the system. Does he not recognise that the Labour Government squeezed inflation down, whereas his Government are squeezing it up, as well as putting up unemployment?

Mr. Younger

The right hon. Gentleman should look at his figures a little more carefully. The Labour Government squeezed inflation down until 1977, when they squeezed it up in 1978–79. That is much of the source of the troubles that we have to deal with now.

The remarks of the right hon. Member for Craigton would have carried greater weight had his solutions been a little more sensible or better thought out. For a former Secretary of State and a member of the Cabinet for a number of years, the collection of solutions that he produced were mutually contradictory to a ridiculous extent. He said that we should reduce indirect taxes, cut VAT, reduce the public expenditure cuts and yet cut taxes. I do not understand the sense of that. He claimed that the changes in regional policy had been utterly disastrous, yet his own constituency was upgraded in importance and has a stronger pull than it has ever had before.

Finally, the right hon. Gentleman talked about the cuts in the Scottish Development Agency's budget. Let us look at those. The actual expenditure of the SDA in 1977–78 was £41 million, in 1978–79 £52.9 million, and in 1979–80 £65 million. For the current year it is estimated at £76.7 million. If that is the scale of cuts that the right hon. Gentleman was talking about, he will realise that this is a ridiculous proposition to put forward. He knows perfectly well that the SDA underspent its budget every year under his Government, and that it has more to spend this coming year than ever before—and more in real terms. That exposes the right hon. Gentleman's figures.

May I remind the right hon. Gentleman of some of the subheadings of unemployment during the first year that his Government were in office? The number of school leavers increased between July 1974 and July 1975 from 6,800 to 16,000 in Scotland and from 14,400 to 55,300 in Great Britain. For young people under 20, the figure for Great Britain went up from 81,500 to 232,900 in the same period and for all unemployment, taking everyone together, the figure rose from 560,500 to 867,400.

The right hon. Gentleman's speech contained much that we shall study with interest, but it did not show either that he appreciated the extent of the failure during his five years in government, which led to many of the problems we are facing now, or that he realised that he had exposed to all the world that he and his right hon. Friends do not have the faintest idea of the policies that they would introduce if something happened and they were to return to office.

Against that background, I wish to make some comments about the situation and what should be done. Governments of both political complexions have been trying to pursue policies aimed at improving our economic performance for the whole of the past decade. It was very clear that the Labour Government did not succeed. Between June 1970 and February 1974 seasonally adjusted unemployment in Great Britain under a Conservative Government actually fell by about 2 per cent. Between March 1974 and May 1979 under a Labour Government it rose by 692,000 or 125 per cent. The economic policies that operated during the 1970s obviously did not succeed.

This was the position facing us when we took office just over a year ago. We recognised that a fundamental change of approach was necessary, and indeed any Government who took office in these circumstances and left the policies running as they were would have [...] guilty of gross dereliction of duty. The country and the House know that, and, in their hearts, so do Labour Members.

I wish to put unemployment in its wider context. Let me consider the impact of our economic policy on unemployment in the longer term before I turn to the specific measures to alleviate unemployment. I do not need to remind the House that the legacy of the previous Government was one of several years of extremely low output. In manufacturing industry, there was a fall in output throughout the Labour Government's period of office averaging 0.7 per cent. a year. Unemployment more than doubled and unit labour costs increased considerably.

We were left with a planned expansion in public expenditure amounting in real terms to about 2 per cent. per annum, which was unsupported by any corresponding increasing in production or any obvious means to pay for it. Moreover, we were handed a number of nasty post-dated cheques in the shape of public sector pay promises and the Clegg Commission. This is familiar ground, but I make no apology for going over it again.

Our industrial base, particularly our traditional industries, shrunk over those years. In shipbuilding and steel, production halved between 1965 and 1979. Over the same period, the production of cars dropped by 38 per cent., yet our international competitors increased their output over the same time scale—France by 129 per cent., Germany by 44 per cent., and Japan by a staggering 786 per cent. It is not difficult to quote other examples. Of course, it is also possible to quote good examples in this country.

However, the underlying trend cannot be doubted. Our comparative position as a trading nation in the competitive world market has fallen over a number of years. In 1960, the United Kingdom's share of manufactured exports from the main manufacturing countries was 15.5 per cent. compared with 9.5 per cent. in 1979. In 1960 the United Kingdom ranked eighth in the league of gross domestic product per head. By 1978 we had fallen to seventeenth.

Of course, we have to recognise that the economic picture is not all black. Unemployment has increased markedly over the past decade, but the general level of employment has remained relatively stable. In June 1970, there were 22.47 million people in employment in the United Kingdom. In June 1979 the figure was 22.83 million, a slight increase.

Many of the new jobs created in this country over the past decade have not been such as to create employment for those who came out of declining manufacturing industries. Without a substantial improvement in economic performance, we shall find it impossible to create jobs for our increasing population of working people.

Increases in unemployment are not restricted to the United Kingdom. The right hon. Member for Craigton has been fond of making that point in the past. Since 1970, the major OECD countries have all experienced a rise in their unemployment levels and, while in more recent months unemployment in Japan and West Germany has been falling, countries such as France, Canada and the United States have, like the United Kingdom, experienced increases.

Unemployment in the EEC as a whole has been rising since September. In the first quarter of this year, the United Kingdom's estimated unemployment rate, at 6.1 per cent., was only fractionally ahead of that in the United States at 6 per cent., equal to that in France and behind the rates of Canada, where it is 7.4 per cent., and Italy, where it is 7.9 per cent.

Mr. Peter Hardy (Rother Valley)

The right hon. Gentleman appears to be making an assessment of unemployment. The debate is supposed to be about youth unemployment. Will he address himself to the fact that youth unemployment in this country has risen enormously and that the proportion of unemployed under the age of 20 has virtually doubled in the past 10 to 15 years? Will he tell us how we can improve opportunities when interest rates at their present levels are deterring the need to invest which underlies the international comparison that he has made?

Mr. Younger

I share the hon. Gentleman's concern about youth employment. I am not trying to omit that subject; and I shall be coming to it. However, I suggest that he reads the Opposition motion, because it deals with general unemployment as well as youth unemployment. I am working within the motion, as I am sure the House wishes me to do.

The United Kingdom is not the only country experiencing a slow-down in the rate of economic activity, and any discussion of our situation must take account of developments elsewhere. In the OECD area as a whole, GDP growth is expected to be considerably less than half the average of the 10 years up to 1978. The outlook is only slightly better for industrial production, and world trade is expected to slow considerably this year after a fairly buoyant outturn in 1979.

The gloomy outlook for the industrial world reflects the adjustment of major economies to the deflating impact of oil price increases, and it makes the solution of our problems much more difficult. I mention those points in order to demonstrate that the problem is deep-seated and has built up over many years. Anyone who ignores that is unable to address himself to the roots of solving the problem.

A solution cannot be brought about overnight and it cannot be brought about by increased public expenditure—certainly not by increased public expenditure and lower interest rates at the same time, a marvellous piece of conjuring which the right hon. Member for Craigton seemed to think he could perform. The record of the previous Administration proves that, if proof is needed. They presided over a massive increase in unemployment and laid the foundations for the problems that we are trying to deal with. They also left us with an increasing public expenditure programme which they could not afford.

Our fundamental requirement is to improve economic performance. I should like to refer briefly to our strategy for securing such an improvement, because Labour Members will doubtless make much of the difficulties that are allegedly being caused to industry and will press the case for an alternative strategy. I do not know whether we shall hear demands for a wage freeze or import controls, but I hope that their suggestions will be a title more consistent that what the right hon. Member for Craigton proposed.

The control of inflation is fundamental to our strategy, as is the restoration of conditions in which enterprise can flourish. In order to secure that, we are committed to a steady reduction in the growth of money supply. The surest way to stop money from falling in value is to restrict the amount of it that is available. Hence, the medium-term financial strategy provides for a year-by-year fall in the rate of growth of the money supply to about 6 per cent. a year by 1983–84.

The Opposition say that they want low interest rates. We all aspire to that. But their suggested policies are contradictory. The higher public sector expenditure that they seek would be likely to lead to still higher interest rates.

We recognise that current interest rate levels are creating problems for industry's investment plans and financial position. For that reason, we attach a high priority to achieving our monetary objectives as quickly as possible. Lower interest rates will come as soon as possible, although the timing is a matter for the judgment of my right hon. and learned Friend the Chancellor of the Exchequer. The only way to attain that aim is to reduce the public sector's demands for finance.

Unless we are to increase taxation—and I was not certain whether the right hon. Member for Craigton wanted that, though he wanted a reduction in VAT—it is essential that we reduce public expenditure. Everyone, including the right hon. Member for Heywood and Royton (Mr. Barnett), knows that that is true. Labour Members would do better to acknowledge that fact.

Mr. Robert Hughes (Aberdeen, North)

The right hon. Gentleman says that everyone acknowledges that public expenditure needs to be reduced, but is he not aware that the Manpower Services Commission agreed unanimously today to write to the Secretary of State for Employment and resist further cuts in its budget which would lead to a reduction by one quarter in the number of its staff who service the unemployed? The MSC says that that is unacceptable and that it will severely resist such a move. What is the right hon. Gentleman's answer to that?

Mr. Younger

My right hon. Friend will look forward to receiving the letter. I have not seen it. If my right hon. Friend were to agree to the MSC's request, the money would have to be found from somewhere else—probably a programme that the hon. Member for Aberdeen, North (Mr. Hughes) is keen on.

Only if we reduce public expenditure and get it in the right balance can the wealth-creating enterprise sector of the economy flourish and create more secure employment and increasing opportunities for our young people. That is why firm steps have been taken on this matter.

Higher interest rates and North Sea oil have led to a strong currency, with consequences for the competitiveness of our exports, but since the key element in the strategy must be to bring down inflation, an attempt by the Government to bring down the exchange rate artificially would succeed, if it succeeded at all, at the cost of weakening monetary control generally. The rate is set by market forces. Intervention beyond normal smoothing operations would be mistaken.

Two specific measures, sometimes suggested by Opposition Members, are controls on wages and controls on imports. Wage control policies, of which we have ample evidence, simply do not work. They perpetuate anomalies. They encourage skill shortages. They lead to inflexibilities in the labour market, and cause a massive explosion in wages when, inevitably, they have to come to an end. The Government's general role in pay matters must, therefore, be to set the financial framework and not to intervene in detail in individual pay negotiations.

Firms and unions must pay close attention to the specific circumstances of the company and industry in which they work, taking fully into account the pressure of competition, both foreign and domestic. Failure to do this results only in falling profits, lack of investment and fewer jobs. Nothing is to be gained by arguing over increases well above what the company or the industry can afford. Increases are not an automatic right. They have to be earned by higher output and higher productivity. Otherwise we lose competitiveness and industry will inevitably have to contract, losing jobs at an ever increasing rate. In short, pay negotiations must be pitched at a realistic level for the circumstances of the industry concerned.

Mr. Donald Stewart (Western Isles)

Is the right hon. Gentleman aware that several examples have been given in the House in recent days of firms which have met all the criteria of low wages, in creased productivity, and even working on the day of action, but which have now gone to the wall? How can the right hon. Gentleman claim that the policy is working?

Mr. Younger

One would have to look at the individual circumstances. If the firm concerned has been unable to produce the goods that its customers want, at the right time, and at the right price, it probably will have had difficulty. That is what everyone has to realise.

Mr. Skinner

What is the right hon. Gentleman's answer to the argument, often put, that for every £1 cut from the public sector, roughly 75 per cent. is thereby cut from the private sector because it acts as the supplier? Is not that the reason why Ladbroke's, not the greatest of wealth creators, can announce a 71 per cent. increase in profits, a firm called Pleasurama can increase dividends by 141 per cent., and the big four banks can make £1,500 million in their last accounts and £1,000 million, so I am told, in the first half year, to be announced shortly? Is that not the real reason why the CBI and others have been trotting along to Downing Street and Government Departments saying "We understand the theory, we are with you all the way, but for goodness sake let's get some unemployment back in the system".

Mr. Younger

It is nice to see the hon. Gentleman back. The burden of his song is that we should be spending our way out of trouble by more public expenditure. That was specifically rejected by the Leader of the Opposition in a famous speech at a Labour Party conference some time ago.

Mr. Skinner

I am not worried about what he said.

Mr. Younger

The hon. Gentleman must know that this option is not open.

It is also suggested that import controls are a panacea to solving our problem. There might be short-term benefits for some industries, but this would be at the expense of the economy as a whole. I am sure that many Opposition Members share the Government's profound belief that, in the longer term, import controls would do us in Britain much more harm than good. We are far more exposed to international competition than the countries against which we would require to erect barriers. The United Kingdom exports 31 per cent. of the GDP by contrast with only 13 per cent. for Japan and 8 per cent. for the United States. The retaliation which the introduction of import controls would provoke would inevitably leave us much worse off in the longer term, with appalling consequences in the longer term for employment.

Our economic and industrial policies are designed to secure the regeneration of the country's industrial base, necessary to create new, secure and lasting jobs. However, this regeneration simply cannot happen overnight, and the Government recognise that we have a responsibility in the short term to those who find themselves unemployed, either through redundancy or through lack of job opportunity.

I should therefore like to turn to the specific measures that we are taking to alleviate the impact of unemployment, particularly among the young, to improve the training system to meet industry's needs to make it easier for individuals to find employment appropriate to their aptitudes and interests, and to encourage the creation of jobs in areas particularly hard hit by unemployment.

We have made available increased provision to the Manpower Services Commission for the youth opportunities programme. We have allowed for increased provision for the youth opportunities programme in 1980–81 of 50,000 throughout the United Kingdom, of which 6,500 are in Scotland. The total number of entrants for YOP will be 250,000 in the United Kingdom and 37,000 in Scotland where the MSC estimates that it will fill 15,350 places in 1980–81 compared with 11,000 in 1979–80.

The MSC should, therefore, be in a position—this answers the specific question of the right hon. Member for Craigton—to fulfil its commitment to find a place on the YOP for any school leaver who remains unemployed the following Easter or for any young person unemployed for more than 12 months. That is the undertaking that the right hon. Gentleman said would be fulfilled in his time. We intend to carry it through this year.

Mr. Millan

I am not simply talking about this year. I am talking about future years. What is the commitment?

Mr. Younger

In future years, naturally we hope to do the same. The right hon. Gentleman has the assurance for which he asked. I hope that he will acknowledge the fact.

Mr. Millan

I did not ask for that assurance.

Mr. Younger

The YOP is not a palliative to reduce the unemployment figures.

Mr. Millan

The right hon. Gentleman is answering a question that I did not ask. I did not ask about the current year. I acknowledge that the figures had been maintained. I stated that the MSC budget will inevitably involve a decline in the numbers over subsequent years unless more money is made available. Will more money be made available to maintain the programme?

Mr. Younger

The right hon. Gentleman is not correct. We have not maintained the programme. We have increased the programme. He might be man enough to admit it.

As the right hon. Gentleman knows—it was the same in his case—these undertakings are not given in advance, many years ahead. He can take our intention this year as an earnest of our determination to keep up standards in this sphere. The experience gained on the programme of work experience and training is of considerable benefit to participants in finding employment later. YOP combines work experience and study of life and social skills. The evidence of numbers leaving courses and subsequently finding employment bears witness to the effectiveness of the scheme.

Mr. Heffer

rose—

Mr. Younger

If the hon. Gentleman does not mind, I prefer to press on with my speech. I shall take too long if I give way.

Surveys have shown that about 70 per cent. of young people participating in work experience schemes have found permanent employment immediately thereafter. The local authority careers service has an important role to play in alleviating the difficulties experienced by young people. The service has stepped up its effort to search out job vacancies for young people and to find opportunities in the youth opportunities programme for those unable to find permanent employment.

Mr. Heffer

Has the right hon. Gentleman seen today's issue of the Liverpool Daily Post which, dealing with the very service about which he is talking, points to seven jobs available for 4,700 unemployed youngsters? There is a total of over 10,000 unemployed youngsters in the area. What plans do the Government possess to deal with that tragic problem?

Mr. Younger

My reading of the Liverpool Daily Post is an absolute essential in my life, I must admit. This scheme is designed to help precisely the situation to which the hon. Gentleman has referred. The fact that there is a large problem to be dealt with is what we are discussing. There is a large problem to be dealt with all over the country, not merely in Liverpool. I hope that the hon. Gentleman will give his support to the programme that is trying to help young people.

Mr. Millan

This debate is about youth unemployment. I hope that Conservative Members are concerned about that. I want an answer to the question that I put to the Secretary of State. If one looks at the MSC "Manpower Review" published this month and at the figures for subsequent years for the youth opportunities programme, one finds that the budget for this year is £150 million but that next year it drops to £136 million, despite the fact that next year youth unemployment will be even greater than it is in the current year. Will these budgets be increased or not? It is a simple question. What is the answer?

Mr. Younger

The right hon. Gentleman has to look at the figures a bit more carefully than that. That is all based on his assumptions of what will happen next year in the first place. In the second place, if he is looking into the future, he must consider the future position about the reduction in the number of school leavers which will arise when the number of people coming on to the market is reduced. [Interruption.] The trouble with the right hon. Gentleman is that, when he has had the answer to one question, he cannot take it. What he has to do is to invent a new question. If I give him another 10 answers to this question, he will just invent a new one after that. He would carry much more conviction in the House if he would admit it when he is given an answer to a question and allow people to carry on with their speeches. [Interruption.]

Mr. Deputy Speaker

Order. The hon. Member for Liverpool, Walton (Mr. Heffer) must not read a newspaper in the Chamber.

Mr. Heffer

I am not reading a newspaper, Mr. Deputy Speaker. I am looking at further evidence in relation to this question. Here is the evidence.

Mr. Younger

The attractions of the Liverpool Daily Post must be even greater than I thought they were.

Mr. Heffer

Just look at it!

Mr. Younger

Perhaps I may continue on the question of young people who are unemployed.

For particularly disadvantaged young people, community industry is designed to provide work experience to enable them to find permanent jobs. The programme was expanded in 1979–80 to provide 6,000 filled places, and we have accepted the need to maintain it at this size for 1980–81.

Provision for the special temporary employment programme, which is aimed at those aged 19 to 24 who have been unemployed for at least six months and older people who have been unemployed for at least a year, is being maintained at 12,000 to 14,000 places. We have concentrated the programme on special development areas, development areas and designated inner urban areas, where the problems are more acute.

I turn to training. An effective training system is essential if we are to grasp the industrial opportunities open to us and if we are to ensure that individuals make the most of their aptitudes and talents. The MSC works in close cooperation with the various industrial training boards in areas of common interest to ensure that proper and adequate provision is made available. As hon. Members known, the MSC is currently reviewing the national training system in order to assess the effectiveness of existing arrangements and to seek improvements wherever possible. We expect to receive its report in July.

We are also considering the proposals outlined in the previous Government's discussion paper "A Better Start in Working Life", which put forward ideas for improving young people's awareness of employment opportunities and requirements.

Mr. Heffer

A sick joke.

Mr. Younger

Apprenticeships have traditionally provided many opportunities for school leavers, and in periods of economic recession firms often tend to cut back on apprentice recruitment. This creates problems not only for young people but also for industry when faced with shortages of necessary skills later on. We need, therefore, to keep up the level of training both for young people who are embarking on their careers and for those who need to channel their efforts in new directions. The MSC and the industrial training boards offer assistance to this end. There is, however, nothing to be gained from making provision for courses which will be under occupied and which do not provide the skills which industry will require.

Mr. Jim Craigen (Glasgow, Maryhill)

Will the right hon. Gentleman give way?

Mr. Younger

Perhaps I may just finish this passage.

Accordingly, the number of places on the training opportunities programme has been somewhat reduced—

An Hon. Member

From 130,000.

Mr. Giles Radice (Chester-le-Street)

Shame.

Mr. Harold Walker (Doncaster)

From 99,000 in 1978.

Mr. Younger

The right hon. Gentleman will have an opportunity, if he catches your eye, Mr. Deputy Speaker—[Interruption.] I think that it would be better for him if he allowed me to make my speech and then made his criticisms later.

The number of places in the training opportunities programme has been reduced from 70,000—

Mr. Harold Walker

99,000 in 1978.

Mr. Younger

—to 60,000 in the United Kingdom—from 9,000 to 7,500 in Scotland—in order to concentrate resources more effectively.

The MSC is endeavouring to ensure that specially disadvantaged groups will be protected from this reduction. The decision to rationalise the skillcentre network also reflects our desire to concentrate resources to bring training provision into line with industry's requirements and to use the resources available to us as effectively as possible.

In conclusion, I should like to reiterate that the Government are deeply aware of the problems that unemployment causes and of the impact of unemployment on those who cannot find work, particularly the young. An unemployed person's morale and his social and financial standing are all greatly affected. The right hon. Gentleman was quite right to draw attention to this as a problem now, as it was a problem when he was in government. I hope that I have demonstrated, at least to the House, that we are conscious of the need to alleviate the impact of unemployment in the short term, and that we are taking steps to do so.

But Governments, as the right hon. Gentleman the Leader of the Opposition has said, cannot spend their way out of unemployment. No Government should take short-term measures which weaken the chance of longer-term recovery upon which our future prosperity crucially depends. For too long we in this country have bolstered up industries and firms which are past redemption and have implemented ill-thought-out palliatives which have reduced confidence in the economy and weakened our economic performance. For too long we have paid ourselves more than we can afford, and indulged in industrial disputes and restrictive practices whose effect in the longer term is to destroy jobs and reduce our standard of living. For too long we have penalised initiative and enterprise and expanded the non-productive sectors of the economy at the expense of the creators of wealth. The effects of this selfindulgence are plain to see. It was imperative to adopt a new course, and to concentrate our resources and efforts on providing the climate for competitive industry to flourish.

That we have done. We have taken firm steps to curb inflation through control of the money supply. We have made a start on redeeming four pledges to industry: to reduce Government spending and give industry room to breathe; to cut away the thicket of Government controls and give the market a chance to work; to redress the balance of power in labour relations; and to encourage and reward enterprise. We have never pretended that this could be done quickly or that there were instant solutions. It is not possible to produce instant solutions after years and years of decline. But we have placed the economy firmly on the path to recovery. Our policies are designed to create that fundamental improvement in our economic performance without which no solution to the problems of unemployment will be found. To succeed, this will need cooperation from a large number of people. Even if Opposition Members laugh and sneer at these difficult problems, we know perfectly well—

Mr. Ennals

Look behind you.

Mr. Younger

—that people in general wish these problems to be solved and that they will support a Government who have the guts to set their hands to doing it.

Mr. Deputy Speaker

Before I call the first Back-Bench speaker, perhaps I may say that in this important debate very many right hon. and hon. Members wish to make a contribution. Mr. Speaker has asked me to say that he will seek to balance the debate by calling Members from regions of the country, but brief speeches will be very helpful and, I think, generally welcomed by the House.

5.18 pm

Mr. John Golding (Newcastle-under-Lyme)

I have often been puzzled as to why Labour did so much better in Scotland than in England at the last general election, but after listening to the Secretary of State, I understand why that was so.

I congratulate the Opposition Whips on exposing the Secretary of State to the people of Glasgow on the eve of a by election. I am sure that they will give a massive vote of no confidence in the Government.

The youth unemployment figures are always unnecessarily high in June, July and August. I can predict a great reduction in those figures in September and October. My first point is that it is time that we got together as employers, politicians and trade unionists to try to avoid the daft situation whereby our young people leave school in May and June but cannot start work because employers do not set them on until September or October.

Our youngsters are suffering because of the system. They undergo a period of initial unemployment which is unnecessary for many of them. But, despite the drop in youth unemployment figures that we can expect in September and October, the figures will be intolerably high next year.

Whatever the effect of the expected expansion of the youth opportunities programme, one thing is certain. That is that the Manpower Services Commission has predicted a doubling in the numbers of young people who will be unemployed by next spring. The reason why it expects that increase is that it will become increasingly difficult to place youngsters from the youth opportunities programme into regular work. There will be a massive growth, not just in school leaver unemployment, but in youth unemployment generally. That is the problem we face and part of it arises as a result of the recession.

Mr. W. R. Rees-Davies (Thanet, West)

I agree with what the hon. Member for Newcastle-under-Lyme (Mr. Golding) says. Does he not agree that there might be a valuable role for the Manpower Services Commission and the jobcentres in trying to find part-time employment for young people during the period between July and September? It would appear that employment offices do not make any effort to find part-time jobs which so many young people could do. Would the hon. Gentlemans Select Committee consider that aspect of the problem with my hon. Friends to see whether anything can be done along those lines?

Mr. Golding

Youngsters should attend at careers services offices and possibly there is far too much pressure upon them for them to cope with part-time employment. But the point should certainly be considered.

Employers in North Staffordshire, where, for the first time since the war, we have an unemployment level of over 6 per cent., do not talk about their problems in terms of higher wage increases. They tell me that their problems are high interest rates, the strength of the pound—particularly important in the pottery industry—and the pottery industry having to pay an artificially high price for gas which make it difficult for them to compete.

Wages claims play a part in inflation, but the Government are wrong to cite them as the only cause of inflation. Employers speak of many other factors causing inflation apart from wage claims. The Government must share responsibility for the current recession.

Youth unemployment is a special problem not only because of numbers but because of the nature of young people themselves. Many old people, when they are declared redundant, believe that they have played a very small part in the process of redundancy. They blame the politicians, the employers and the world recession. An adult who has worked hard for 20 years in the belief that he has done a good job and who is declared redundant leaves the plant with a degree of self-confidence. He blames other people.

I discovered in the Department of Employment that young people who cannot find employment quickly blame themselves and become demoralised. That is particularly the case among those youngsters who have not fared particularly well in our school system, which is often not geared to coping with the average or the below average youngster. The school system having failed them—or they having failed in the system—they quickly become demoralised when they fail to get work.

My eyes were opened one winter morning when I spoke to a youngster in the Oxfam waste centre in Huddersfield. He told me that when he was not able to find a job he did not leave home for months. When he continued to find it impossible to get work he did not speak to his mum for weeks. When the offer of a place on the job creation programme came, he cried. When he eventually went to work, separating rags, he felt that that was the greatest thing that had ever happened to him. He had been given a sense of purpose.

The problem of youth unemployment is special because of the impact on an individual's whole being. I believe that that situation is now shared by many of the long-term unemployed who lose their self-confidence after about six months of unemployment. When they have been unemployed for 12 months one begins to detect a change in their personality. There is now a massive problem of youth unemployment and of long-term unemployment. The MSC forecast of the doubling of youth unemployment in the coming year comes with a forecast of an increase in the number of the long-term unemployed to 500,000 by 1982. That is the size of the problem and it is a big problem.

Up to now the problem has manifested itself principally among those whom I have always called the rough and tumble. Those are the people who have not done well at school, who have rough personalities, who do not dress very well and who are not eloquent. Unemployment has been pretty well concentrated among those youngsters in the past. This year we see a difference. We are now getting reports, town by town, of unemployed youngsters who possess O-levels and who have a fair bit about them. That unemployment comes about partly because of reductions in recruitment in local government, in the Civil Service and in offices generally. Employment in those sectors is declining and that decline is having a significant impact on youngsters.

There has also been a reduction in the recruitment of apprentices. Those who talk to employers and to trade union officials know that this is happening. I am sad to say that neither the Manpower Services Commission nor the Government have acted early enough this year to counteract the reduction in the recruitment of apprentices. The Government will, perhaps, act later in the year. But it will then be too late. It will be too late because the brightest and best of the youngsters wanted by employers on award schemes as apprentices will have gone into other work. Youngsters who in the past would have gone into offices will also have taken up different work.

The problem with bright youngsters this year is that they will be taking up work that is below their potential. They will be grabbing whatever work they can and employers will take the best of them. Those youngsters will be underemployed and that, in turn, will make the problem for less able young people more acute. The jobs that they would have taken in the past will not be available to them. The brighter youngsters will be in and the less able will be squeezed out.

If, later in the year, the Government make jobs available for the brighter youngsters they may find that they will not leave the jobs they have. They will say "We are not leaving now. This mister gave us a chance when we wanted it". There is a great deal of loyalty in young people towards adults who have given them that chance. The Government must look very carefully at the pattern of employment among young people to correct the deficiencies.

The problem of youth unemployment cannot be explained away by a Tweedle-dum-Tweedledee attitude, by which the political parties call each other names. Behind that there exists a genuine problem in this country, as in others, which goes beyond party policies. An element of that is that jobs for young people have been disappearing. When I was a lad my first job was to make the tea. That work is now done by vending machines, which no doubt do a better job than I did. The corner shops have disappeared and with them the lads who delivered the groceries by bicycle.

The second institutional reason was shown when the Holland committee inquired into reasons for youth unemployment. It found that employers readily took on youngsters for apprenticeships and office jobs but not for semiskilled and labouring work. Part of the reason for that is that employers go to the careers officers for apprentices and office workers, but they go to the jobcentres and employment offices to fill semi-skilled and labouring vacancies. That means that the careers officers who, in spite of criticism of them, do a superb job, just do not have the semi-skilled and labouring work to offer the 16 or 17-year-olds.

There is tremendous discrimination against the young in employment. That happens for several reasons. Employers believe youngsters to be less reliable than older people. There are many more older people, including married women, than youngsters available to work. Given a choice between a married woman of 25 whose children are at school and a girl of 16 or 17, an employer will take on the former. That is partly because the older person has the image of being much more reliable. A further element is that differentials in pay as between the young and adults have been squeezed. There has been a change in the wage structure, contrary to the interests of young people as far as employment is concerned.

There is also a resistance among the work force to the recruitment of youngsters. Workers on the shop floor are opposed to youngsters being recruited to production jobs because they fear that, where earnings are related to production and bonuses are paid, the youngsters will muck around or will not have the strength to maintain the bonus earnings. One notices in engineering shops that, while adult males and females are employed on production work, very few youngsters are so engaged. The unions insist that apprentices have to be 16, 17 or 18. They want no adults in the training. The reverse attitude is adopted and acted upon with production work.

The incidence of shift working is another factor, because we stop youngsters of 16 and 17 from doing shift work, and the growth in that type of work has restricted employment opportunities for the young.

We must consider these problems in detail in an attempt to remove the institutional barriers from the employment of young people, rather than ascribing every aspect of youth unemployment to political causes. Short-term measures are needed. The youth opportunities programme should be extended in a number of ways. We should not be comparing the statistics of Labour and Conservative Governments. Our task should be to identify the need and to establish whether it is being met.

The Department of Employment has a good case to take to the Treasury for an extension of the YOP in terms both of numbers and duration. There is a limit on how long youngsters may spend in the programme. However, with employment becoming more and more difficult to find, the Government should tell the Manpower Services Commission that they will agree to extend the time that a youngster may spend in a youth opportunities scheme so that young people are not forced out of the scheme into unemployment. If they are forced out, much of the value of the programme is undermined.

There should be greater provision of schemes other than work experience. The Government have succeeded in maintaining the numbers in the youth opportunities programme, but only by concentrating on the cheaper schemes and playing down the more expensive ones. However, the cheapest scheme—and for many, the most successful—is the work experience programme, and that needs extending. The problem with it is that it does not satisfy the needs of the roughest and the least qualified of our youngsters, because employers will not take them on to the works premises, and sponsors often will not take them up. These youngsters may be rough and inarticulate, but they are still entitled to a job.

The Department of Employment and the MSC must face up to the need for an expansion of opportunities for 18-year-olds. There is great pressure throughout the country to increase the allowance for this age group. The 16 and 17-year-olds are willingly taking up chances offered under the YOP, but the 18-year-olds often are not. There is evidence that the careers service and the Manpower Services Commission are having great difficulty with 18-year-olds because the allowance that is paid to them under the youth opportunities programme is not attractive enough.

The biggest problem that the Department of Employment faces is that of persuading the Treasury to increase the provision for the special temporary employment programme, not only for the 19 to 24-year-olds, but for the long-term unemployed among those over the age of 24. The Secretary of State misled the House when he said that the Government would maintain the STEP programme at 12,000. The Government cut it to 12,000, and they now intend to maintain the programme at that level. The previous Labour Government had a higher figure and proposed a higher figure still, but even that was inadequate. The figure for the long-term unemployed—people who have been unemployed for over a year—is expected to be 500,000 by 1982. Unemployment of two or three weeks or a month is no social disaster, but unem ployment of 12 months is a personal, social and family disaster. There will be about 500,000 long-term unemployed in 1982, and the Government intend to maintain provision for 12,000. Those two figures side by side show that there is a national problem. The Government must act now to try to alleviate the problem of the long-term unemployed.

The tragedy of our present circumstances is that the Department of Employment has been too preoccupied over the past 12 months with the problems of industrial relations, and too little with the problems of unemployment. The Department has lost too many battles in its arguments with the Treasury on behalf of the unemployed. I hope that this debate changes the balance of thinking within the Department of Employment, and I hope that it gives it strength in dealing with Treasury Ministers in order to give the unemployed a fair deal.

5.42 pm

Mr. Geoffrey Rippon (Hexham)

The House will have listened to the hon. Member for Newcastle-under-Lyme (Mr. Golding) with respect, He struck the right note when he said that we must all try to act together—employers, trade unions and the Government—in trying to solve these problems. He said that that applied particularly to youth unemployment, but I suggest that it must apply right across the board.

I do not often agree with an intervention from a sedentary position by the hon. Member for Bolsover (Mr. Skinner), but when he said that we do not want a Tweedledum or Tweedledee attitude I think that he was speaking for many hon. Members. I wish that the right hon. Member for Glasgow, Craigton (Mr. Millan) had adopted a similarly constructive attitude. I do not wish to be partisan, but we are entitled to point out that the Opposition are in no position to cast stones at the Government on unemployment.

Under a Labour Government unemployment rose from 600,000 in 1974–75 to over 1,370,000 in the years 1977–79, and they anticipated a further rise. Labour Governments have twice doubled unemployment in the North-East, and I do not wish that to happen again, particularly under a Conservative Government. All hon. Members know that the North is traditionally vulnerable to economic recession. Registered unemployed in the Northern region in March of this year was only 9,000 above the total for March 1979. But everyone knows that the upward trend is continuing, and it cannot be ignored. Neither side of the House can be acquiescent about unemployment, which has been running at over 9 per cent. in the Northern region for a number of years.

We should all be able to agree that there are no benefits from high unemployment. We cannot exaggerate the economic and financial cost or the social cost of unemployment at its present level. There is the cost to the economy in terms of low production, the financial cost to the Government in terms of loss of tax revenue, and the payment of unemployment and social security benefit. That is now well over £1,000 million a year higher than it was in 1974, and it is rising. That, of course, is to the detriment of the public sector borrowing requirement. Above all, there is the cost to society in terms of the social unrest that prolonged unemployment may provide. We should not underestimate the consequences of prolonged unemployment on social, racial, religious and regional tensions and, in the course of time, on attitudes to work and society.

The pernicious effect of a high level of unemployment is particularly noticeable among school leavers, and, as far as we can judge, it is likely to get worse. We cannot overestimate the debilitating effect on young people who have never had a job. They appear to be rejected by society without a chance, and that is bound to lead to a measure of disaffection. I am grateful for the comments of my right hon. Friend the Secretary of State for Scotland about the Government's actions in regard to the youth opportunity programme and training programmes. In the longer run, perhaps we should consider whether it would not be better, for the young people and for the country, to introduce a period of conscription, not necessarily into the Armed Forces but into the public service. Perhaps that is a matter for another occasion.

In the next few years we shall have to give a high priority to regional policy as part of our general strategy. Perhaps the old economic planning councils were not the best instruments for co-ordinating regional policies, but they were better than the vacuum that we have at present. Perhaps too many of the old grants, aids and subsidies were merely palliatives and did not deal with the structural changes that are taking place in industry which we cannot avoid. However true that may be, it is no reason for precluding sensible spending to assist productive industrial change, notably on training and on measures to improve labour mobility.

I am all for placing limits on public expenditure, and in any Department with which I was involved the expenditure went down, not up. I have always maintained, and I shall continue to maintain, that what matters is how the money is spent-how it is apportioned between investment and consumption, and how it is. apportioned between the regions. Instead of wasting over £1,000 million a year in additional unemployment and social security benefits, we need—and the CBI recognises it—a positive regional policy to improve the utilisation of resources in the less prosperous areas of Britain. That means a sensible public investment programme that creates wealth. If properly applied and administered, such a policy could reduce unemployment in depressed areas without—and this was always the anxiety—causing overheating or other damage to the rest of the economy. We had some problems in regard to overheating of the economy in the early 1970s, but we do not have those problems today. It is arguable which is the worst and most dangerous position to be in.

Without effective and sustained measures to create new job opportunities, it is extremely difficult to justify, for example, the closure of the Consett steel-works in Durham. That is a closure which will have a devastating effect on a whole community within an area in which, no job opportunities are readily available. Challenged by the British Steel Corporation to break even by March 1980, Consett did just that. It may be that there are accumulated heavy losses and it may be that ultimate closure is inevitable, but in the present situation we should not underestimate the social as well as the economic damage that cannot be repaired by large-scale redundancy payments, which are themselves made at the taxpayers' expense.

It is not that the Government's general strategy or purpose is wrong but rather that it is being inadequately fulfilled. It is not a question of making U-turns but rather of responding to changing circumstances and the realities of economic life. I agree wholeheartedly with my right hon. Friend the Prime Minister that there can be no patent medicines and that there are no easy options. It is not a choice between inflation and unemployment. It is certainly true that if inflation is not curbed unemployment cannot be contained. Therefore, we must all recognise—th;s follows from what the hon. Member for Newcastle-under-Lyme was saying—that we must work together to solve this problem, accepting that the economy cannot stand another round of excessive pay increases.

In the context of this debate, it is sad that Mr. Len Murray should make another rather senseless speech on the subject this morning, saying that unemployment has no effect on wage demands—[Interruption]. The hon. Member for Aberdeen, North (Mr. Hughes) mutters from the Opposition Front Bench, but the fact is that we must consider this problem together. The trade unions have a part to play, as do the employers and the Government, just as the Opposition have a duty to be responsible in the national interest.

Therefore, public sector pay is an area in which the Government must set an example. They must lay down guidelines which, whether or not we like the words, are, in effect, an incomes policy for the rest to follow. In that I think they would be helped by saying "Thank you and goodbye" to the Clegg Commission and to Lord Boyle's Top Salaries Review Body. My right hon. Friend will have noted that the chairman of the Conservative Party in another place only a few days ago said that Clegg was a disaster and that comparability was a meaningless concept. There were some Conservative Members—more than 100—who suggested that the Clegg Commission might go the day after it had been appointed. It was once said that one man's pay increase was another man's price increase. What is truer today is that one man's pay increase may be another man's job.

I believe that managing the economy is a question of balance. The unanimous view of the summit conference in Venice was that we must somehow contrive to fight inflation without recession. That is not easy, but I do not believe that it is impossible, once one accepts that excessively high interest rates and a correspondingly distorted exchange rate neither automatically curb the money supply nor reduce the public sector borrowing requirement. Indeed, there is growing evidence to the contrary. I have argued it myself for a long time, and I was glad to see similar views expressed by Lord Lever of Manchester, among others, in the House of Lords recently.

The Government are continuing to borrow on terms which will cost generations of taxpayers thousands of millions of pounds a year more than it should or need. The annual amount of interest which the Government must pay on the national debt has, over the last 10 years, risen from £1,419 million to an estimated £9,885 million. It has risen most since 1974–75. The debt itself has risen from £33,442 million in 1970–71 to £95,327 million in the last financial year. That is about £1,700 worth of debt for every man, woman and child in the country. But in this context, and more significantly, the overall rate of interest for the same period has increased from 4.5 per cent. to 9.5 per cent. and is expected to reach 10.4 per cent. in 1980–81. That really does add to the PSBR and does not reduce it.

Meanwhile, industry is forced to go on borrowing at rates which cripple investment, productivity and profitability, thus aggravating the unemployment problem. So far as I can see, the only immediate beneficiaries are the moneylenders, who are allowed to act as though the word "usury" had never been invented. They are enjoying a euphoria unknown since the early days of Herbert Hoover and the so-called return to normalcy.

Perhaps I might recall a little more of the days of Herbert Hoover and add that it does an injustice to Professor Friedman to limit his doctrine to a theory about the necessity of controlling the money supply in all circumstances. In his book "Free to Choose" he not only points out that the banking crisis in the 1930s in the United States brought about the dis appearance of thousands of banks but adds: the total stock of money showed an equally drastic decline. For every $3 of deposits and currency in the hands of the public in 1929, less than $2 remained in 1933—a money collapse without precedent". As Friedman goes on to point out, that decline in the money supply undoubtedly made the economic collapse far worse than it would otherwise have been. He said that business failure, declining output and growing unemployment all fostered uncertainty and fear. In my judgment, we are heading that way today. If that calls for a change of direction, so be it.

If Governments refuse to adapt the means by which they seek to achieve their policies, they are called obstinate and arrogant. If they do modify their policies, they are criticised for making U-turns. To a large extent it is a Catch 22 situation. But I would say to my right hon. Friends, better by far to adopt the attitude of the late Sir Winston Churchill, who when charged with inconsistency said that his thoughts were a continuous and harmonious process.

A man who goes out on a sunny morning with a rolled up umbrella to use as a walking stick is not criticised for making a U-turn because he holds it up when the deluge comes in the afternoon.

5.58 pm

Mr. Jim Craigen (Glasgow, Maryhill)

The right hon. and learned Member for Hexham (Mr. Rippon) coped admirably with his Catch-22 situation, because he made a number of pertinent points about the Northern region. As my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) knows, the Select Committee on employment took some interesting evidence in Newcastle and is fully aware of the problems that he outlined and the hammer blow that the closure of Consett would be to that area.

I was sorry that the Secretary of State for Employment did not open today's debate, because anyone who was looking for a positive and constructive statement on the Government's intentions towards employment generation must have been sorely disappointed. I realise what a toom tabard we have in the Scottish Office at the present time. It was a disgrace to give the House the kind of historical treatise that it was given this afternoon.

The sad thing is that this will be only one of many debates on the subject of unemployment at a time when we can see a rising graph in the unemployment figures.

It is a frightening fact that the Government are prepared to watch the pool of unemployment grow into a dam that will overwhelm the economy of Britain. There is evidence of a fall in retail turnover in the past month, and that is only the beginning of a downward trend in the economy of Britain. There are Tories who imagine that unemployment is something that many prefer. There may be a few who are happy to be idle, but the majority do not seek unemployment.

There are now 52,600 people out of work in Glasgow. Among males, the figure has risen to 13.6 per cent. The bleakness of the position is revealed in the figures for the two employment exchange areas that converge on my constituency. In one there are 4,455 on the unemployment register, with only 161 vacancies, while in the other there are 7,839 on the unemployment register, with only 458 vacancies. As my hon. Friend the Member for Newcastle-under-Lyme pointed out so effectively, people will remain on that register for longer and longer periods.

That is not the position throughout the length and breadth of Britain. In London and the South-East, two thirds of the males on the unemployment register have been registered for less than six months, whereas in Merseyside a half of the males on the register have been registered for more than six months. There is a considerable unevenness in the distribution of unemployment. Moreover, I am concerned about the fact that in my area we are seeing more redundancies and indications of short-time working in the pipeline.

The Secretary of State did not give way to me when he was speaking about apprenticeship opportunities. I wanted to tell him that an engineering company in my constituency, which I shall be visiting on Friday afternoon, took on seven apprentices last year, but this year it will take on only two. At one employment exchange last year 80 vacancies were registered by the local authority. This year, only eight have been registered. That is another indication of the extent to which public expenditure reductions are beginning to take their toll.

We hear a great deal about entrepreneurs. That word has become more and more fashionable. The present rate of interest is enough to frighten off anybody thinking of starting a new business, to say nothing of those who spend sleepless nights worrying about how to keep their existing businesses viable. The main problems that worry industrialists in my area are interest rates, the high level of inflation and the value of the pound. The Government should do something to reduce the level of interest rates. We read that Germany will have an inflation level of 4 per cent. next year. The Government should also reduce the artificially high level of the pound, which has greatly affected our exports.

If the latest predictions of the IMF are correct, it is clear that Britain will have to do more to satisfy the home market rather than continue to see a flood of imports. Part of the problem is that Britain has a singularly effective retail distribution network. We are too good in that area of activity, and we tend to facilitate the inward movement of goods and services.

North Sea Oil has become a chloroform that is producing a coma in our industrial community. When we waken to the realities of the industrial surgery that is taking place throughout the country, we shall realise the grave conditions that youngsters and older people will face in the 1980s. If we treat the younger generation as improvidently as the Government are apparently treating the great reserves of North Sea Oil, Britain will face a chilling future. It will deserve all that it gets. because the youngsters in Britain are also our resource for the future.

I notice that there is a growing restlessness which, as yet, has not articulated itself on the Conservative Benches, but it is coming. The CBI sent us a newsletter saying that it backs the Government but that it wants "some flexibility". As the number of redundancies and, more especially, bankruptcies begins to grow, the Back Benches will begin to turn. There comes a point where loyalty ceases to be a virtue and becomes a vice. Bearing in mind the parliamentary arithmetic we know that we shall not win the vote in the Lobby tonight, but we need more Tories to speak up for sanity.

6.7 pm

Mr. Harry Greenway (Ealing, North)

We have heard in speeches today—and in previous speeches—about the effect of unemployment upon individuals, families, communities, areas and nations. There is much stirring literature to direct one's thoughts towards the effect of unemployment upon individuals and to heighten one's appreciation of the problems. However, I have not heard, either inside the House or outside it, any discussion about the effects of unemployment on schools.

I was working, in a top position, in a comprehensive school with 2,000 pupils for the five years between 1974 and 1979. I am not seeking to be unduly partisan, but youth unemployment and unemployment among school leavers rose during that time by 500 per cent.—and some say that it could have been more than that. The effect of that on schools was very serious, and needs to be taken into account. Schools are microcosms of the broad community in which we live, and reflect that community. Schools must have a sense of idealism in going about their task of preparing children both for life and for work. They set out to establish in pupils a work ethic. That is important, and it has been mentioned this afternoon.

Qualifications have also been mentioned. A school, if it is going well, will strive hard to help its pupils to achieve the highest possible qualifications. I know that some pupils will not achieve any formal qualifications, but if schools are doing the job that they were established to do, they are concerned to bring all individuals to a sense of the important matters in life that are essential to sound working practices; for example, punctuality, diligence, smartness, honest endeavour and sound relationsips. Those attributes help the school to work well, and help the individuals in their work when they come to it.

The hon. Member for Newcastle-under-Lyme (Mr. Golding) said that low achievers had more difficulty in getting jobs today than in past years because they are low achievers. I am talking of low achievers, not under-achievers. I am not sure that is true. I am proud to say that schools today are doing more for low and mid-ability pupils than has been done for many years. Many are, in fact, doing well in getting jobs, whereas others with very good qualifications are not succeeding. Provided that a boy or girl has sound motivation and is prepared to work well, and has a bit of personality and understanding of sound relationships in work, in the family and in society, that individual, whether or not he or she has many formal qualifications gets into work. I can say this from long experience in schools over 20 years.

Mr. David Alton (Liverpool, Edge Hill)

From the hon. Gentleman's experience in schools—an experience which I have shared—will he say what the crisis of morale is doing to youngsters who, when they go to jobcentres, find that there is no work for them? What point is there in having the best educated youngsters if they are going to be in the dole queue?

Mr. Greenway

The hon. Gentleman has made for me the very point that I was making. There is a serious effect upon schools if there is a long dole queue.

Schools, like everyone else in society, have a keen interest in high levels of employment. If jobs are available, boys and girls will work well at school, staff will be motivated, families will come in and support the school and it will be a thriving community—the kind of backbone that we need for the nation that we want.

I believe that the Government, employers and the unions—I spread my theme more widely—have to work together on this vital question of employment. Attention has rightly been drawn to the part that the Government and employers have to play. Management is sometimes much less sensitive than it needs to be towards young employees. The unions also have a role to play.

I had a surprise—indeed, a shock—when a young man aged 21 walked into my surgery last Friday and told me his story. I should like to share his experience with the House, because it may by symptomatic, though I hope that it is not. This young man, Graham Hunter-Gray, told me that he had been to a secondary modem school. He had a job as a cold store operator. It was seasonal work. He was not a member of a union and he decided to work on the TUC's so-called day of action, 14 May. On 15 May he was told by the manager of the cold store unit that he was a blackleg and could not work there.

Graham went back to the company and asked if it would do something about it. The company offered him other employment for which, due to there being a closed shop in operation, he needed to be a member of the Transport and General Workers Union, but that union would not accept him.

The company then offered him clerical work, but for this, again due to there being a closed shop, he had to be a member of the Association of Scientific, Technical and Managerial Staffs, I understand, and that union would not accept him because of the Bridlington agreement. I do not see how that applies, strictly speaking, but that was Graham's story.

Therefore, Graham was suspended from work for a month. During that time he again applied for membership of the Transport and General Workers Union. Having applied, he was asked to attend a branch meeting, but was refused membership. He was asked at the meeting why he went to work on 14 May. I should point out that he was not at that time a member of any union affiliated to the TUC, so, logically, he could not necessarily be expected to be involved in the TUC's day of action. However, following his assertion that he wished to work on 14 May, he was told that he was unacceptable, since he could not be relied upon to strike in future.

At that same meeting three other older union members were present. This court, comprising 26 members of the union, was held on a Saturday morning. The three older union members, who, like Graham, had also worked on 14 May, were put through their paces. Each of the three was told that if he paid a day's pay to a charity of his own choice that would be the end of the matter. Those men were not asked to name the charities to which they would pay the money. It was left at that. I think that that was a wise decision. That option was not extended to Graham. He appealed to the regional office, but has not yet received a reply. The branch manager has had to sack him as he is a non-union member. Graham is within the category about which we are concerned in this debate.

Mr. D. N. Campbell-Savours (Workington)

Will the hon. Gentleman give way?

Mr. Greenway

I will in a moment. Graham is 21. He went to a secondary modern school—he is not a highly educated chap—and got himself a job. He is now out of a job through no fault of his own.

Mr. Campbell-Savours

Will the hon. Gentleman give way now?

Mr. Greenway

Not for the moment. Graham is unnecessarily unemployed. I shall take this matter up with Mr. Moss Evans and hope to get a fair reply from him. I cannot understand why Graham could not have been given at least the same treatment as the other three workers to whom I referred.

Mr. Campbell-Savours

The hon. Gentleman has made substantial accusations against the Transport and General Workers Union. Before he made his statement in the House, did he seek to identify the officers of the union concerned and find out the other side of the story? Or is this a typical example of a Conservative Member coming to the House and making unsubstantiated accusations on the basis of one side of the story only?

Mr. Greenway

I do not need that sort of lecture from that hon. Gentleman or anybody else. I saw letters, almost illiterate letters, from union officials—

Mr. Campbell-Savours

Check the facts.

Mr. Greenway

—to a youth of 21 who had had to stand before a kangaroo court of 26 people on a Saturday morning and be treated in that way. He has been thrown out of his job. It is a serious matter. I am not concerned with knocking unions or anybody else, but it is my job to bring before the House the plight of this young man, a constituent, who falls within the category about which we are rightly shedding tears today. We must practise what we preach. So must the unions.

Mr. Campbell-Savours

Check the facts.

Mr. Greenway

I consider that I am right and that it is my duty to call the attention of the House to the position of my constituents, particularly in the context of today's debate.

6.18 pm

Mr. David Alton (Liverpool, Edge Hill)

The Opposition Front Bench opened the debate by referring to an article that appeared in The Sun this morning. The right hon. Member for Glasgow, Craigton (Mr. Millan) talked about the article in Sir "Larry" Lamb's newspaper which gives advice to people who might be looking for jobs. The right hon. Gentleman referred to the suggestion in that paper that people might become beach attendants. There is another example of how people should go about getting jobs. It states: Agricultural work is one possibility. All sorts of crops need picking from now on. Check whether your local farmer wants help. That is not much use to people living in our cities, where the main unemployment problems occur. That newspaper, rather like some of the speeches from the Government Benches this afternoon, demonstrates a typical insensitivity when looking at the problems of the young unemployed. [Interruption.] I have listened to the entire debate. With the exception of the speech by the right hon. and learned Member for Hexham (Mr. Rippon), the speeches by Conservative Members were of the kind that might be expected from a party that has helped to drive unemployment up to close on 1½ million.

Mr. Greenway

Since the hon. Gentleman is being critical of the speeches of Conservative Members, may I remind him that during the course of my speech he was in total agreement with what I was saying, and went on to say it again for me?

Mr. Alton

I do not know the exact details of the constituency case that the hon. Gentleman quite rightly brought to the attention of the House, but I know that many of my young constituents, because of the economic policies being pursued by the Government, are not getting the opportunity to work. One constituent, however important he may be, and however important the circumstances may be, is not fundamental to the issues that we are discussing today. If there are not jobs available for youngsters such as the one mentioned by the hon. Gentleman, that is the fault of the hon. Gentleman's Government. It is the fault, not necessarily of the Secretary of State for Employment, but of many of his colleagues who are not here this afternoon—people from the Treasury and from the Department of Industry. [Interruption.] My colleagues are at a parliamentary party meeting, which occurs at this time each Wednesday.

I know that the Prime Minister is an avid reader of The Sun newspaper. She has told everybody so. I am not sure whether she is an avid reader of The Guardian, but I draw to her attention and to that of the Secretary of State the leader in this morning's edition. It states: Incomes policy may never have been a triumph, but free collective bargaining has time and again proved to be a disaster. In this country it is no longer a matter of free collective bargaining; it is more like free collective chaos. One strong union is able to hold the country to ransom and to demand vast amounts of money for its workers, resulting in an increase of perhaps 20 per cent. in wages, as has happened already on average this year. As the right hon. and learned Member for Hexham said, this inevitably means that one man's pay increase is another man's job.

If people are demanding more and more money for themselves, that is the economics of the mad house, where money is being taken by one group of workers often at the expense of the jobs of another group of workers. But, equally, the high interest rates, at 17 per cent., which have been allowed by the Government to accumulate have meant that many small businesses are being forced to the point of bankruptcy, are having to lay off workers and are contemplating closing down altogether.

Mr. Richard Needham (Chippenham)

I am interested in the hon. Gentleman's comments on free collective bargaining. Is he aware that at the last election in my constituency the Liberal candidate was violently opposed to any form of incomes policy and a great believer in free collective bargaining?

Mr. Alton

I am not sure who was the Liberal candidate in the hon. Gentleman's constituency at the last election, but sometimes, as he will know from his own party, there are dissenting voices. The Liberal Party is the only party in this class that has consistently pursued a policy of incomes restraint through a properly ordered and statutory prices and incomes policy.

Mr. Skinner

The Liberal Party has never had to carry one out. That is the point.

Mr. Alton

The Liberal Party had an opportunity when it entered into an agreement with the Labour Party. It did not just talk about theories but has to put its policies into practice. I remind hon. Members, including the hon. Member for Bolsover (Mr. Skinner), that prior to the agreement with the Labour Party—

Mr. Skinner

It was not with the Labour Party.

Mr. Alton

—in this House, the mortgage interest rate was 12.25 per cent. By the middle of the pact it had been reduced to 8.5 per cent. [Interruption.] At the present time, as hon. Members will probably not need to be reminded—

Mr. Skinner

What a load of tripe.

Mr. Alton

—the rate stands at 15 per cent. One of the consequences of that has been felt in the construction industry. There has been a massive decline in private house building. That, inevitably, has had an effect on construction workers. Only a week or so ago we were discussing the state of the British construction industry, in which close on 200,000 people are out of work.

Let us consider next the minimum lending rate. In March 1977, as a result of political co-operation—[Interruption.] I am speaking of political cooperation and what it can achieve, not just carping from the Back Benches. The minimum lending rate then stood at 10.5 per cent. Today it stands at 17 per cent. Inflation, which was reduced to single figures, now stands at 22 per cent.

I do not claim that that was all a result of the Lib-Lab pact—[Interruption.] Hon. Members may laugh, but I claim that it was a victory for common sense, conciliation and co-operation. [Interruption.] I have always supported the principle of political cooperation and agreement, and I also supported the introduction of the Lib-Lab pact. [Interruption.] The point—

Mr. Deputy Speaker (Mr. Richard Crawshaw)

Order. It is not right for hon. Members to shout continually. We all enjoy an amusing joke, but continual interjections become a little boring after a while.

Mr. Alton

Thank you, Mr. Deputy Speaker. Many young people in this country today are becoming sickened by the spectacle of the statistics being bandied around and by the constant—

Mr. Skinner

Will the hon. Gentleman give way?

Mr. Alton

I give way to the hon. Gentleman.

Mr. Skinner

Let us have this on the record. Will the hon. Gentleman give a categorical answer to the point that I have been trying to make? Is it a fact that when the Lib-Lab pact was started in this House—after the International Monetary Fund had ripped up the Labour Party manifesto—the hon. Gentleman, not then a Member of this House but practising community politics in Liverpool, put on the record, along with many others in the Liberal Party, that he was against the Lib-Lab pact?

Mr. Alton

I can tell the hon. Gentleman that I voted for the party resolution at our party conference—although I am not sure of its relevance to our debate today—in favour of the Lib-Lab pact. I can also tell the hon. Gentleman that I do not think we drove a hard enough bargain with members of his party.

Mr. Skinner

I have the cutting.

Mr. Alton

I am in favour of political cooperation, as I have been reiterating, but if ever again we enter into an agreement with the Labour Party or the Conservative Party, I hope that we shall drive a harder bargain on the economic policies to be pursued to alleviate the unemployment situation in Britain. People are fed up with the sordid spectacle of hon. Members shouting and bawling at one another and bandying statistics around but ignoring the plight of every individual in the dole queue at the present time.

I should like to give an example from my own constituency in Liverpool. The hon. Member for Liverpool, Walton (Mr. Heffer) referred hon. Members to today's edition of the Liverpool Daily Post. The Liverpool Echo last night pointed out that unemployment had reached a record 13 per cent. on Merseyside and commented that it's going to get worse". The article referred to a jobless total of 98,244—compared with last month's total of 91,534", and added There are now 11,085 youngsters chasing 73 jobs at careers offices on Merseyside. [Interruption.] Those are not just statistics. Every one of those people is a human being who has been educated in our schools and had vast amount of public money spent on him. They have raised their aspirations and hopes, only to have them frustrated and thwarted when they look for some kind of work. Is it any wonder that they become bitter and twisted? Is it any wonder that we have the problems that we have in our cities, when people are festering with great concern and worry about their own futures?

Is it any wonder that we have the trauma of people having to leave home in search of jobs'? The Conservative Party talks a great deal about its concern for family life. Nothing is doing more to break up families in the heart of our cities than the policies of the Government. They are driving people away from places such as Liverpool and Glasgow. Only this morning I was talking to youngsters of 16 and 17, 44 per cent. of whom are unemployed in the city of Glasgow. The position there is even worse than it is in Liverpool.

In the face of all these problems, the Government have decided to reduce, in terms of real expenditure, the Manpower Services Commission. I am not one of those in favour of providing palliatives or poultices for problems. We have to get to the fundamental reasons for unemployment and try to do something about them. Until we are in a position where we can start combating unemployment and its root causes, it is absurd to reduce the budget of the Manpower Services Commission. It is absurd to cut back on schemes that have been in operation in many of our cities through voluntary agencies and thus exacerbate the problems of the young unemployed.

The Government are leading us in a dance macabre. High interest rates are doing little, if anything, to reduce the growth of the money supply, yet they are crucifying industry, directly and indirectly. Foreign money is being attracted to London, so artificially boosting the level of the pound. Our exports are becoming dearer and foreign imports cheaper. Our firms are losing orders at home and abroad. As a result, there is higher unemployment.

Free-for-all wage bargaining is making British industry even less competitive. As The Guardian states, the latest St. James group forecast shows that nominal wage increases of 10 per cent. this winter, with wage rises falling by 1 per cent. a year thereafter, would cut inflation by two-thirds and boost manufacturing output by 4 per cent. in 1983 and 5 per cent. in 1984.

Under the present policy of applying the law of the jungle to the wage bargaining process, manufacturing output is expected to fall every year for the next four years. That will mean more unemployment. It is a dance of death, and the victim is the British economy. National output is falling, and is forecast to go on falling, in spite of our oil wealth. The rate of inflation has doubled in the last year. The Prime Minister is celebrating the fact that it has peaked at nearly three times the level that it reached during the Lib-Lab pact. Our manufacturing industry is being destroyed in the name of dogma.

What do we expect to pay for our food and clothing when the oil runs out, as it must? The spiral will become worse and worse. The people bearing the brunt of the attack on our living standards are the youth of the country. Between 1973 and 1978 youth unemployment rose by 870 per cent., when unemployment generally rose by a bad enough 147 per cent.

The latest figures by the Department of Employment show more than 500,000 people under the age of 24 out of work. The only age group anywhere near that are the 60-year-olds. A total of 187,000 school leavers are unemployed. They are youngsters who have never been given the chance. The Sun would suggest that they organise donkey rides on the beach.

The Government must reverse their lunatic policies now. An incomes policy is vital. Further schemes for profit sharing and worker participation are essential to increase productivity and therefore competitiveness. There should be useful ways of employing the unemployed on public works, both social and capital, even if only part time.

Every incentive should be given for people to invest in wealth-creating industry, instead of being paid by the Government to take out mortgages on bricks and mortar. I commend the amendment to the Finance Bill moved by my hon. Friend the Member for Colne Valley (Mr. Wainwright) to give tax relief to small investors in industry to bring that into line with mortgages and life assurance policies.

There must be an industrial strategy for employment. If the Government delay, it will be too late. We have already seen the events at St. Paul's, Bristol. Surveys in The Times have shown links between high crime rates and youth unemployment. The danger is that British society will blow apart at the seams—young versus old, employed versus unemployed, North versus South and black versus white. The blame will be the Tory Cabinet's, and nobody else's.

I come from an area where unemployment is close on the 30 per cent, mark—even higher than the city-wide average of 13 per cent. There is a powder keg in our cities. It is like a time bomb that is ticking away and could blow the heart out of our cities if young people become angry and erupt against the people who have shown such callous contempt for their problems. It is up to hon. Members and the Government to concentrate on the causes of unemployment, and not on its effects. We require a prices and incomes policy and work-sharing schemes so that more work is made available for more people.

There should be a lower retirement age. We need a proper regional policy so that the differences between the regions are properly examined. Steps must be taken to ensure that the discrepancies between the affluent South-East and the deprived North-West are rectified.

When she was Leader of the Opposition the Prime Minister asked Will the Prime Minister explain why, after four years of Labour Government, the level of unemployment in this country is now worse than in any of our major industrial competitors?…Will the right hon. Gentleman explain why his policies have led to that result?"—[Official Report, 4 April 1978; Vol. 947, c. 234–35.] I am sure that I speak on behalf of many young people when I ask why the Government, like their predecessors, have allowed unemployment to rise so high? More important, what are they going to do about it? Why do they not get together with the other parties in the House to try to thrash out solutions to our unemployment crisis?

6.35 pm

Mr. David Madel (Bedfordshire, South)

All right hon. and hon. Members have stressed the seriousness of the unemployment figures. They have said that the country is not alone in facing the crisis which has been brought about mainly as a result of the colossal increases in world oil prices in the last two years. Britain was less able to cope with the strains, partly because of low investment, partly because of unsatisfactory working methods in many factories and partly because of none too good industrial relations.

The motor industry is beginning to experience great difficulties. In the last 15 years Chancellors of the Exchequer from both parties have used the taxation system clumsily on the motor industry, in a way that Germany, Japan and France have not. As a result, their motor industries are in a stronger position to face the recession.

The motor industry is the only major industry in Britain which attracts a double system of indirect taxation. Car tax was introduced in the 1972 Budget and came into effect in April 1973. That was 10 per cent. in addition to VAT. The yield from car tax in 1973–74 was £120 million. It climbed to only about £380 million in 1978–79. When the Chancellor examines the balance between vehicle sales, tax revenues and future employment in the motor industry, I hope that he will agree that there is a case for asking whether we should continue with the tax.

I do not seek to wipe out all revenue from car sales. However, this is the first time since that special tax was introduced that the motor industry has started to slide into a real recession. Yesterday we read about redundancies at Ford. Vauxhall is now in the middle of a two-week lay-off for some employees with no certainty about what will happen after the summer break. Bearing in mind the number of industries which rely on the motor industry, the car tax question should be examined now.

I wish to examine the existing programmes to combat unemployment, particularly youth unemployment, and to make suggestions about how we might make improvements. Everyone will admit that the Government are involved in a measure of subsidy, as in every Western Government, to try to combat unemployment. It is vital that it is not an everlasting, open-ended subsidy but that it is used to create real jobs and real opportunities for training which give people a chance to move on to real jobs.

The Opposition are fussed about the alteration which the Government made to the job release scheme. They made an alteration to it six weeks before the general election. Welcome though the scheme is, it is difficult for employers to adapt to sudden changes in it. A skilled man might retire early, but it is not always easy for an employer to find a skilled unemployed person to fill the vacancy. We need a period of stability with the scheme so that there is a take-up of unemployed people.

We should examine whether we should relieve some employers for national insurance contributions for a couple of years if they take on a young person between the ages of 19 years and 24 years. That has been done in Belgium with a modicum of success. To some extent, it has been put into practice in the Republic of Ireland.

In a more dramatic way, it is also being tried in Canada, where there is an employment tax credit programme. Under the Canadian scheme, employers receive an employment tax credit if they hire an unemployed person to fill a newly created job and if that person adds to the normal work force. The Canadian scheme does not, therefore, underwrite jobs that might otherwise be lost. We should consider that scheme carefully. The scheme has provided about 20,000 jobs and has been sufficiently successful for the Canadian Government to continue it until 31 March 1981. I hope that this Government will consider those two aspects.

I particularly welcomed the statement that my right hon. Friend the Member for Lowestoft (Mr. Prior) made yesterday at Question Time. Hon Members may like to refer to column 211 of the Official Report in which my right hon. Friend is reported as having said that the youth opportunities programmes had been expanded by more than 60 per cent. in the past two years. The Manpower Services Commission commissioned a research project entitled "Into Work". We must consider whether the youth opportunities programme is succeeding, and whether any alterations should be made as a result of the research project. Page 22 of the document questions whether the training given by the youth opportunities programme is too similar to school tuition. The commission interviewed several of those who had been on a course. It pointed out that, where-ever possible, training should take place within a working environment. It pointed out that care should be taken to prevent an atmosphere of scholastic tuition. It argued that participants should be treated as adults.

A new provision in America may be particularly relevant to Britain. The Carnegie Centre has just published a research project. The Economist of 12 April states: What is suggested is that two days a week all through the last two years of high school, should be devoted to activities outside the classroom, either work or volunteer community service. Normal instruction in skills and academic subjects can be compressed into the other three days without serious loss. The White House was so impressed by that idea that President Carter announced in his January budget that $2 billion would be given towards a project to help the urban unemployed, particularly young blacks.

The Department of Education and Science, the MSC and the Department of Employment should get to know each other better. I am worried about the way in which training is organised and about the change from school to working life. Those three bodies often work not in harmony, but in different directions. The Carnegie project could, and must bring them together if we wish to make such a start.

In relation to the youth opportunities programme, the research project also mentions short industrial courses. On page 22, it states: The Manpower Services Commission should ensure that Short Training Courses, and Skill Sampling Courses should, wherever possible, include short placements on employers' pre mises to complement the skills sampled at a college. Although those who have been on such courses welcomed the instruction that they received at college, some of them feel that it is no substitute for experience on an employer's premises. I welcome the project's remarks. On page 23, it states: where a young person begins to realise through being on a Short Course that she/he would like to learn a skill/craft beyond the basic level offered on the Short Course, there should be provision for her/him either to transfer to a more specialist course, or to carry on to a supplementary course which builds upon the basic skills learnt. The project is a serious piece of research.

I have given only three specific suggestions for improving the youth opportunities programme. I hope that the Government will consider the project, and suggest and make alterations.

One aspect is of vital importance. The document points out that one major problem is the level of confusion that exists among the young about the youth opportunities programme. It is stated on page 24: They had very little knowledge of the range of options, the difference between the various schemes and the opportunities which should have been available for training, transfer and employment. Representatives of the Manpower Services Commission should go into schools and talk to those who are in their last year. They should point out that if the worst happens and a school leaver is unable to find a job the MSC can offer a range of courses, and can guarantee some form of help. Young people would then understand more clearly what was on offer.

I hope that the Government will make greater use of skillcentres. There is an age limit. It is impossible for a young person to go to a skillcentre until he or she is 19 years of age. In times of unemployment, that age limit should be lowered to 16. Many of my hon. Friends are also interested in the "open tech", which is mentioned in the Conservative manifesto. How near are we to starting that project? Will it involve home learning, or courses at polytechnics? How will day release fit in? How will the project fit in with the Open University? I know that much preparatory work has been done on the "open tech." As unemployment increases, the need for an "open tech" becomes more urgent.

I have suggested that we should concentrate subsidies on areas that will lead to the creation of real jobs. Once real jobs have been taken up, those subsidies will not be needed. We should also concentrate such subsidies so that help is given to the young to acquire skills. The nation must become more skilled if it is to survive. I hope that the Government will proceed accordingly.

6.45 pm

Mr. Donald Coleman (Neath)

When hon. Members from all parties read the report of the debate I am sure that they will agree that the speeches that were made by my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) and by the right hon. and learned Member for Hexham (Mr. Rippon) have adorned it. Their speeches will have encouraged young people. They will have given them a hope that they would not have had if they had listened only to statistics being given in a snarling way that compared how "we" did with how "they" did, and so on.

The subjects under debate will have far greater impact than our own political significance, or insignificance. I grew up in the days of the depression. I came from a home that was plagued by unemployment. When I hear the word "unemployment", it sears through my soul. When I realise what society can do to its members, I am filled with horror and revulsion.

The debate gives us an opportunity to consider youth unemployment. The Government cannot complain if people believe that the Government think that money is more important than people. People outside believe that as long as this philosophy persists, more and more of them will find themselves out of a job. Regrettably, the momentum and the pace of this phenomenon is growing daily. There are those who believe that protests about industrial closures can be quietened by the payment of enhanced redundancy moneys and the provision of schemes which will accommodate natural wastage. None of us can blame those workers who find themselves in such an uncertain situation, faced with the loss of their jobs, that they take these bribes. Those who put their faith in such practices should be ashamed because what they are doing is stealing the jobs of our young people and denying them the right to work.

The redundancy payment schemes was never intended to be a means of buying up jobs to destroy those jobs. The British Steel Corporation has been busily engaged in just that practice over the past few years. The whole purpose of the schemes was to compensate workers for the loss of jobs that were no longer required by a modern society. If we do nothing else tonight, other than make known our opposition to this destruction by such methods of the rights of our young people to jobs this debate will have been worth while.

I wish to enter a plea for my area—my county and my constituency. Neath is part of West Glamorgan and contributes greatly to the industrial capacity of that county. West Glamorgan is a very compact area and there is considerable cross-travel-to-work throughout the county. Therefore, when a closure occurs in any part of the county, it affects not only that part in which the closure has taken place, but the whole of the county. What happens in Neath is as bad for Port Talbot and Swansea as it is for us in Neath.

It is regrettable to record that since this Government came to office, unemployment in Neath has risen from 8.1 per cent. in May 1979 to 9.2 per cent. in June 1980. Even worse, youth unemployment has risen in actual figures—from 189 to 341—during that period. From the investigations that I have made with the youth employment service I have found that this is only the beginning, and shortly we shall see a further rise in unemployment. In my area even young people who have been apprenticed find themselves no longer safe from the ravages of unemployment.

Having outlined the relationship between the various parts of West Glamorgan, I move to the situation that the county faces as a result of the slim-down of the Port Talbot steelworks. If one went into any playground of any comprehensive school in the county, spoke to a group of children and asked them where their parents had found work and where they themselves hoped to find work, I guarantee that a large proportion would say "We shall find work at the steelworks." In the face of such a dependence for jobs by both young and old in West Glamorgan on the Port Talbot steelworks, it is little wonder that the pathetic response of the Secretary of State for Industry and his monetarist disciple, the Secretary of State for Wales, in refusing our plea that the whole of our county should receive special development area status should have caused such anger.

West Glamorgan has a proud record of preparing its young people to take their place and make their contribution to Britain's future prosperity. But the response of the Secretary of State for Industry and the Secretary of State for Wales has been to ignore this. In turning a deaf ear to our pleas, they are condemning our young people to becoming members of one of the best educated dole queues in the world. That is what the theories of monetarism really means in practice.

My young constituents in Neath will come to realise that as long as these ideas are pursued more of them will become unemployed. My challenge to the conscience of the House tonight is that we must put a stop to these policies. If we do not, our young people—not only in West Glamorgan, but throughout the whole of the United Kingdom—will never forgive us.

6.57 pm

Mr. W. R. Rees-Davies (Thanet, West)

In his opening remarks the hon. Member for Neath (Mr. Coleman) put it rather well when he said that his hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) had made an excellent and constructive speech. That also applies to my right hon. and learned Friend the Member for Hexham (Mr. Rippon) and my hon. Friend the Member for Bedfordshire, South (Mr. Madel). The reason why their speeches were so good was that they all moved along constructive lines, as did the hon. Member for Neath to a large extent.

I believe that the days are over now for this boring practice of the Socialists in the red corner and the Tories in the blue corner bashing themselves across the Floor of the House of Commons about whether they have done the right thing. I have been here so long that I am getting bored with that, and personally I would like to see much more of the Select Committee approach. The hon. Member for Newcastle-under-Lyme is the chairman of the Select Committee on Employment, on which several of my able colleagues also serve. I have the difficult task of trying to lead, without being the chairman, the Social Services Select Committee, and I have just been outvoted on my suggestion that unemployment should be a matter for our consideration because it involves benefits and many matters of crucial importance to this country. But never mind, it is possible that we shall deal with it next year.

The whole question of future employment prospects in this country requires the attention of the collective brains of members of all parties in the House. The only Liberal speech that we have heard tonight was from the hon. Member for Liverpool, Edge Hill (Mr. Alton) and that speech was entirely designed for outside consumption. It consisted of a collection of statistics put together after the hon. Gentleman had read an inordinate number of quotes. We need a little original thinking on this matter. It may not be good, and hon. Members may not like it, but I shall put forward some original thinking in my short observations.

I want to deal with two aspects of the problem—the "unemployables", those who have been unemployed for a year or more, and youth unemployment. The Isle of Thanet consistently has 8 to 10 per cent. unemployment. It is in the South-East, but it is a major area of unemployment. We have a lot of youth unemployment and, for reasons of health, many people retire early to my part of the world and there is much long-term unemployment. Some of those retired people are unemployable and some cannot get employment because it does not exist in my area.

Many people have suggested to me that we should have national conscription. I explain politely and patiently that the Services would probably not want it. What is the point of having conscription if it will not serve the needs of the nation? However, may we not have to consider some form of conscription of youth into work for 12 months to enable them to be trained and to be working during an important part of their lives, in which they would gain the discipline that would arise from a job, albeit a compulsory one?

If hon. Members say that it would be going a little far to force young people to take a job, I ask whether it is going too far to introduce a form of community service. Many young people in my constituency do a considerable amount of voluntary community service. Would that be helpful for a while? At least they would be working, which is better than being unemployed. I am concerned about the possible breaking down of their morale at a young age.

If that suggestion is turned down because it is thought to go too far, I turn to various other schemes of which the Government operate some, including skillcentres and the YOP. We could develop those. The hon. Member for Newcastle-under-Lyme was right to say that part of the trouble is that youngsters of 16 or 18 are being paid too much compared with young people of 22 or 24. That militates against their employment prospects. Of course one would give a job to a sensible, married women of 25 who has one child and wants to work rather than to a 17-year-old.

The Government must analyse that approach and the Opposition must help. We must look at such schemes to see whether, in the long term and in light of the dangers of youth unemployment, we can pull together to find schemes to alleviate the problem. Of course, that involves an obligation on young people to take a job. Many hon. Members have three or four skills and occupations—I have at least three or four—and we are able to do many different jobs. However, it is part of the rules of the Department of Employment that a person cannot be forced to change his job. That is wrong.

After a reasonable time we must expect a person to have to change his job rather than stay unemployed. He may even have to move his home. I knew a foundryman in the Isle of Thanet, where we have only one company that employs foundrymen. He was not employed by that company and could not get a job in Thanet, but he wanted to stay there and to remain unemployed and go on being paid. I told the social security people to get rid of him and to send him elsewhere. I said that he should be allowed to stay only if he was willing to change his job.

We need to train our young. As my hon. Friend the Member for Bedfordshire, South suggested, we should adopt the suggestion of the Carnegie Centre and allow youngsters to go out to work one day a week before they leave school. That is particularly important for those who will have to undertake unskilled work.

Our Select Committees could help the Government in the basic thinking. Along those lines, I beg the House to give up party politics in this area. It is unworthy of the House and is not fruitful.

About 55 per cent. of the unemployed have been out of work for more than 13 weeks, about 15 per cent. have been out of work for between six and 12 months and about 25 per cent. have been out of work for 52 weeks or more. What can we do about that picture? Because of the shortage of time, I shall concentrate on those who have been without a job for more than 13 weeks.

When a person has been unable after 13 weeks to get a job in his own skill or to get the job that he particularly wants, he should not receive any more unemployment pay unless he is prepared to take any other reasonable job that is available. The test will have to be carried out by the local officers, because we cannot allow for appeals. It means that the unemployed must be prepared to move their job or even their home.

Most of the young people in Thanet go away because there are no jobs for them. They have always done so and I have always said that we should let them go to where there is work. We must have greater mobility of labour and more training in new skills and we must encourage the opportunities for people to change their occupations.

If young people in Thanet ask me where they can find jobs, I tell them that they can help to pick fruit in Faversham, they can work in hotels or they can do gardening work. Workers are wanted in those areas, though perhaps for only eight or 10 hours a week. There is a lot of moonlighting, but some young people do two or three jobs and, in the round, are well paid.

I see no reason why someone should not work for 20 hours a week at a skilled job and also have an unskilled job, which will help. For example, I employ a chap who was Army chef. I said that he had to do more than that for me and would have to work outside as well. He agreed and I said "All right, you do your chef work and then you get out and buckle down in the garden and do odd jobs". That is an example of the changing face of employment.

Last week a lady in Thanet advertised for a gardener She had 60 replies and interviewed 16 applicants. They were all on social security. Not one had a job and none had made an effort to get a job as anything other than a gardener. That is absurd. Half of the population are gardeners. In Thanet we have nothing but gardeners. Every woman is a first-class gardener and many know a great deal about gardening. There is no reason why a gardener should not be able to do another job or train for another skill.

We must see that those who have been unemployed for a long time change their occupation and take whatever work is available. We should encourage young people to have the discipline of some kind of work from the earliest part of their life.

7.10 pm

Mr. Dafydd Wigley (Caernarvon)

I shall not follow the argument of the hon. and learned Member for Thanet West (Mr. Rees-Davies). His claim that the points that he put forward were made in a non-partisan and non-political way belies credibility. If there were thousands of jobs available in certain sectors, and thousands of unemployed gardeners who did not wish to take them, that would be one thing. The situation, however, is that the unemployment rate is not only staggeringly high but that the number of vacancies is going down constantly.

According to the figures published yesterday, there are 165,000 vacancies in the United Kingdom. This means that 10 people out of work are chasing every job. I cannot see that this situation provides much scope for the hon. and learned Gentleman's theory. The effect in an area such as my constituency, which has suffered generation upon generation of depopulation, when the best of the young people are asked to go away, can be devastating.

I shall not quote many figures, but I must place some on the record. Unem ployment in Wales has now reached 99,000 and vacancies are down 15 per cent. Only some 6,000 jobs seasonally adjusted, are available in Wales. There are 14 people chasing every job. The projection from the department of economics at Bangor last month stated that unemployment in Wales, in a couple of years, will be up to 170,000, or 14 per cent. on an optimistic set of assumptions. On pessimistic assumptions, the figure was put at nearer 30 per cent.

All parts of Wales are hit. In the north-east of Wales the figures show unemployment of 12.1 per cent. in Wrexham and 14.5 per cent in Shotton. In the north-west of Wales in my own part. Arfon the figure is 10.4 per cent., and in Anglesey, 12.4 per cent. In the southwest of Wales, places like Cardigan have 13.3 per cent. unemployment, and Lampeter 13 per cent., while in the south-east of Wales, Ebbw Vale has 14.6 per cent. unemployment, Bargoed 13.4 per cent. and Aberdare 11.1 per cent. In every corner of Wales the problem exists. Of the total number of unemployed, 37 per cent. are aged under 25. Within that group, over 30 per cent have been unemployed for over six months. This will have social effects that will hit Wales hard.

Against that background, we are critical of the changes that the Government have made in the development area status for Wales. We do not pretend that the status, in itself, will solve the problems, but development area status in Wales has been reduced in such a way that many parts of mid-Wales, with high unemployment levels, receive no greater benefits than Kent. This is a disgrace at a time of increasing unemployment.

I should like to deal with the steps that need to be taken to meet that situation. I hope that the House will take as read some of the remarks that I would normally have made about the parity of the pound, interest rates and import controls. There is not much point in repeating remarks already made by other hon. Members. I want to concentrate on the logic of the Government, and perhaps of previous Governments, that it is acceptable to pay people to be out of work, when it would be easier to pay people to do useful work. If all the work in the community had been done, and if people were living in acceptable housing in an environment that had been tidied up to accord with the standard that should prevail, and if old people's homes were properly manned and there were adequate numbers of nurses in the hospitals, it would be possible to consider a reduction in working hours and a lower retirement age.

All around us, however, work that needs to be done stares us in the face. People are living in inadequate houses that need to be repaired. There are married people on housing waiting lists, with the husband perhaps living with his parents, and the wife with hers, and the children playing ping-pong between them. The condition of roads needs to be improved and many inner city areas remain squalid and need to be cleared up. Additional facilities are needed in rural areas.

Much of this necessary work lies within the construction sector, which has been especially hard hit by unemployment. The challenge is to bring this mismatch situation to a more fruitful outcome and ensure that unemployed building workers now living on the dole can be given work on the houses, roads and facilities that are needed.

We should look at unemployment not only in terms of the £1,000 million to which the right hon. and learned Member for Hexham (Mr. Rippon) referred, in a constructive speech. Even more important is the available manpower that is being wasted. The wealth and standard of living of any community must be related to the number of people in productive employment and the total population that they have to support. If we accept the position that more people must be made unemployed as a direct consequence of Government policy, the overall standard of living of the community will inevitably go down. The fundamental problems facing the community cannot be solved by putting more people on the dole.

The difference in the cost to the State of a married man, with a wife and two children, being out of work or in work is put at £80 per week. On the one hand there is the loss of national insurance and income tax payments, and on the other the paying of unemployment and supplementary benefits. Would it not be preferable to pay £100—admittedly involving more public expenditure—with something to show for it in the building of houses, schools and hospitals and fulfilling all the other needs that exist?

I should like to give an example in coal mining. There has been some discussion in Wales about the closure of coal mines that are admittedly difficult to operate. Because of the nature of the seams, they cannot be automated. They have been running at a loss. If those coal mines are closed, there is little possibility that a miner aged 50 will find alternative work, yet that mine contains a source of energy. Once that mine is closed, it will be written off and lost for ever. Are we saying that we prefer to pay coal miners for doing nothing, while at the same time a source of energy is lost for ever?

The logic of the situation belies credibility. It would surely be more useful, in the interests of the community as a whole, when there is no alternative work, for the miners to carry on working, albeit at a loss in straight financial terms, because at the end of the day there would be something to show for it. There would be the coal that had been dug and the use of asset that would otherwise have gone to waste. That is the logic with which Parliament and successive Governments have failed to come to grips.

The same situation can be seen in the way that local government employees are being put out of work. Ministers are urging local authorities to put people on the dole when there is no alternative work available for them. Roadworkers will be doing nothing, when roads could be improved. Teachers will be doing nothing when they could be helping to bring down class numbers. Housing repair workers will be doing nothing, when houses need to be repaired. Would it not be more sensible for these people to be put into work than accept that they should be paid for doing nothing?

Mr. Rees-Davies

I am following the hon. Gentleman's remarks with interest. They are parallel with what I was saying. The essence of his argument is that the teachers and those he has mentioned would be prepared, if unemployed, not to work as teachers or in an occupation in which they had previously been engaged but to switch jobs. It would pay the nation for that to happen rather than have to pay supplementary benefit.

Mr. Wigley

I understand what the hon. and learned Gentleman says, but these other jobs are not available. There is unemployment and no job availability in so many sectors. When a teacher has been trained for two or three years to do a professional job, and when class sizes can number 35 to 40, the logic must be for the teachers to use their talents in areas for which they have been trained. In the long term, perhaps we should advise fewer people to go into teaching if there is to be less demand—which I do not accept. However, certainly with construction workers, there is work that needs to be done.

It would appear that the Welfare State has gone wrong almost from its inception along these lines. We have been compensating people for being out of work rather than squaring up to the necessity of finding work within the community. I shall not follow the line of talking about compulsory or forced work. I am talking about the concept that we should try to ensure that there is work available, rather than say "What-ever the problem, we shall compensate people and that is enough"—because it is not enough.

These people and their families will suffer, and there will be social consequences from their being out of work, particularly the young. Therefore, I should like to see the Welfare State reconsidered along the lines of moving towards a position in which there is work being provided to the extent that there is work that needs to be done in our community. Until such time as it can be shown that there is not work that needs to be done, that should be the principle that we should follow in seeking a solution.

We hear that there is a problem in every country. I cannot help but look with envy at countries such as Norway, which has a 1.2 per cent. unemployment rate, at Switzerland, with 0.2 per cent., at Austria, with 2.1 per cent., and at Sweden with 1.8 per cent. Those are figures from this month's edition of the Employment Gazette. It is possible for some communities to overcome the problems. I would have hoped that it would be possible to do so in ours.

I come to the problem in schools, about which we have heard. Morale is low in schools when teachers have to teach children and encourage them to go on to apprenticeships and take examinations, and the children say "What for? There are no jobs for us when we have finished doing that." It is a heartbreaking situation. I met some teachers only two or three weeks ago who put that point to me.

Side by side with the need to give incentives in schools, there is a need to put more money and resources into the development of careers advice. That is relevant to this debate. Careers advice is the Cinderella of the subjects dealt with in our schools. So often we find that it is the old PT master who has gone over the top who is told to do careers as a sideline, with no training or background for it and very few resources to do it. As a result, in some areas, in some very limited jobs, there are mismatches.

In my area, for instance, there are jobs going with the water authorities, technical jobs, and some technical jobs are available in the social services, which the children have not been advised to consider as careers. As a result, people are brought in from outside to do those jobs and the children who could have been trained for them do not get the opportunity in their own community. That is one of the problems of career advice, as is starting the advice at a sufficiently early enough age and not leaving it to the fifth or sixth form. It should be started at the age of 11, or even earlier.

I commend one other scheme that is being undertaken in the constituency of my hon. Friend the Member for Merioneth (Mr. Thomas). It is a junior enterprise experiment, following an American pattern, where a group of children are given the opportunity to start running a commercial venture themselves in school—in this case, I think that they are making lamps, and so on, in the form and then marketing them—and at the end of the year seeing whether they have succeeded in selling these and whether they have made a profit or a loss. They are at least getting commercial ideas into their heads in school in a way that has not been done generally, certainly in the schools in Wales. There is room for that side to be developed. It may be that only one out of 30 children gets a direct benefit that he will follow up as an adult, but if only one out of 30 started a project himself that would be well worth while in terms of new ventures in the community, and the employment so created.

The problem of youth unemployment is depressing and worrying. It is right that the House should apply itself to it tonight. I only hope that, as a consequence, solutions will be forthcoming.

7.24 pm

Mr. Raymond Whitney (Wycombe)

I recognise the sincerity of the concern expressed by the hon. Member for Caernarvon (Mr. Wigley) about the unemployment situation in Wales, notably youth unemployment. However, I suggest to him that the main remedy which, as I understood it, he was suggesting, would lead to a rigidly directed economy. Where such a course has been followed in other parts of the world it has both extinguished liberty and not led to a genuine economic prosperity. I also suggest that the examples which he gave of successful economies with low unemployment, such as Switzerland and Norway, are not those which have followed the sort of policies that he was suggesting as a solution for our problems.

We have a problem which has been with us for very many years. It is not a question of a change of Government last May or a question of the introduction of what some people, mostly on the Opposition Benches, would call monetarism. It is a problem which for many years has been with us in the British economy. Several times, again from both sides of the House, we have been reminded of that well-known quotation from the utterance of the right hon. Member for Huyton (Sir H. Wilson)—that one man's wage rise is another man's place in the dole queue.

I suggest that that analysis, with which I basically agree, was also put to an important conference, the Labour Party conference. I offer this not in any partisan spirit. I agree that snarling across the Chamber is not what we should be about this evening when dealing with this very important problem.

I offer this as an analysis which I believe is correct and remains valid. As I understand it, it was an analysis presented by Mr. Peter Jay, who, after completing it, was translated as Her Britannic Majesty's Ambassador in Washington. It was pronounced by the right hon. Member for Cardiff. South- East (Mr. Callaghan) to the Labour Party conference in 1976. He said: We must ask ourselves unflinchingly what is the cause of high unemployment. Quite simply and unequivocally, it is caused by paying ourselves more than the value of what we produce. There are no scapegoats. This is as true in a mixed economy under a Labour Government as it is under capitalism or under communism. I do not think that anyone could have identified the major contributory cause better than the right hon. Gentleman. Certainly other causes are referred to. The alleged lack of investment in the British economy is a worry, but it is an exaggerated worry. It is interesting to see the report produced by the right hon. Member for Huyton. After three years' hard labour, he apparently confirms that the investment strike of which we have heard so much is not the primary cause of our unemployment problems.

Indeed, the shortage of investment where it occurs is the effect of our industrial problems, not the cause of them. The trouble is that the rate of return on capital invested in manufacturing enterprises is abysmally low. In years gone by it was anything up to a 10 per cent. return. Now we are talking of about 2 per cent., whereas any investor, be it the State or a private investor, can take his money and get 12 or 13 per cent. in many other ways. Therefore, it cannot be an investment shortage.

Indeed, in those industries which have been able, because they are nationalised, to ignore—albeit temporarily—the natural laws of economics, and which have been able to make the water run uphill and to invest against the grain, we have found that that, too, has not produced the solution. It has not solved the unemployment problem. As an example, I mention the steel industry. Over the last 10 years it has had thousands of millions of pounds invested in it. Yet we are closing many steelworks, on understandable economic grounds.

Therefore, investment is not the problem. Nor does it lie in one of the other allegations which tend to be made against British industry. It is not the quality of management. Who would say that management in British industry was perfect? Who would say that of management anywhere? British management, as we see it in this country and when it exports, stands up perfectly well with that of other countries. Likewise, when allegedly high-powered overseas management comes to operate here it runs into the same problem.

Basically we come back to the prescription of the Leader of the Opposition, who said that for many years we have been paying ourselves more than the value of the goods we produce. Never has that been more true than in the past two years. During each of those years earnings rose by 5 per cent. more than prices. In the 12 months to 31 March this year the tax and prices index increased by 17.6 per cent. Yet average earnings increased by over 20 per cent.

In this difficult economic time, what were our competitors doing? What were the other industrial nations of the OECD doing? Generally speaking, they had a lower inflation rate than ours, but, more than that, they settled for an increase in average wages lower than their own inflation. The net result is that over the past 12 months the competitiveness of British industry has declined by a factor of about 20 per cent. The effect of that is obvious. Markets are denied and jobs are lost. That is our present experience.

I shall refer shortly to another factor resulting from this great wage pressure and the reason why that wage pressure has cone about. I do not wish to detain the House for long. Another influence is the pressure of money available in our system. May I offer the House one fact? In the financial year 1978–79 commercial bank lending to companies ran at an average rate of £500 million a month. In the financial year 1979–80 it increased by no less than 50 per cent. Average lending went from £500 million to £750 million a month. Despite high interest rates, despite pressures on liquidity and the problem that that has caused for investment, cash flow and many other things, companies felt obliged to borrow because they were locked into a vice by the pressures created by the British system.

With the high public sector borowing requirement joining forces with pressure from the commercial sector to raid the quantity of money available, interest rates have inevitably risen. Those are the causes of high interest rates. We are locked into a circle which may at the moment seem vicious and it may seem impossible for us to break out of it.

One or two solutions are on offer. Protectionism is increasingly attractive to the Opposition parties. It is certainly attractive to the Labour Party. My right hon. Friend the Secretary of State for Scotland dealt with this issue admirably when he pointed to the fact that in our economy—which is more dependent than that of any other trading nation on overseas trade—nearly one-third of our GDP is exports. Japan has less than half of that in terms of expenditure of GDP. We simply could not tolerate the retaliation against us. Given the industrial and labour relations background against which British industry has to operate we would simply postpone the problem. I have seen that happen overseas. After we had put up the barrier, would there be reform, modification and change? No, there would not. We would relax. We would get softer and softer and become more and more inefficient. Clearly the road to protection is the road to further problems, to further unemployment and to further economic debilitation.

Another possibility offered is that of further devaluation. How we effect devaluation is a matter of debate. The proposal is that we should tell the world not to buy our pound at $2.35 or $2.30—which is what buyers wish to pay—and say that we will sell the pound at $2.10 or $2.15. Whether we could devise a mechanism for that is one thing; whether we should devise that mechanism is another.

Let us recall, for example, the famous devaluation of 1967 when the present Leader of the Opposition was Chancellor of the Exchequer. I do not say this in any partisan way, but that devaluation did not produce the answer. It softened us up yet again and weakened British industry. So that route is not the answer. It would also lead us to inflation.

The same is true of yet another solution that is offered which, sadly, has been hinted at by some of my hon. Friends as well as being trumpeted by Opposition Members—more public spending.

Our present public sector borrowing requirement is running this year at £9.8 billion. That borrowing will probably be of the same order at the end of the current financial year, and if we went over that figure we should be straight back into inflation—not the inflation we are now dealing with, but hyper-inflation which would destroy our society more certainly than the horrible threat of unemployment, which I do not minimise.

Labour Members are fond of quoting John Maynard Keynes in defence of what I call their irresponsible financial policies. They often forget the importance that Keynes gave to the factor of money and inflation. I offer the House this quotation from Keynes: There is no subtler, nor surer, means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction and does it in a manner which no one man in a million is able to diagnose. That is the problem we are wrestling with. We must continue to wrestle with it because if we turn back we shall have lost our last chance to put Britain right. We must persevere with these policies.

I spoke about a potentially vicious circle. I believe that we face a great challenge because we have the potential of North Sea oil. That potential must give us the opportunity to lift ourselves into an economy and a society ready to face, in industrial terms, the 1980s and the 1990s.

We have a responsibility not only to ourselves but to the rest of the world to carry out adjustments, modernisation and advances in technology. That is a duty not only to ourselves but to the rest of the world. That brings us back to the terms of the North-South dialogue—the Brandt report. I commend that report to Opposition Members who, understandably, show legitimate concern for the economic development of the South. However, at the same time, most of them seem to find it possible intellectually to suggest that we put up the trade shutters.

The developing world would far rather have open trading than almost any amount of aid. The developing nations wish to trade with us. The way for that to happen is for us to move into technologically advanced industries. If we are to do that, we must look again at our trade union relations. That is why the Employment Bill is so important. That measure is correctly named and although, as my right hon. Friend the Secretary of State for Employment knows, I have considerable misgivings about the adequacy of the Bill and whether it has been introduced at the right time, I believe that it is moving in the right direction. It is moving in the direction of employment.

We must bring our trade unions into the 1980s before we can bring our industry into the 1980s. Therefore, any measure—and here I include the Employment Bill—which can ensure that trade unions are given a much more responsible leadership than they often manifest at the moment can be only of benefit.

I hope, therefore, that the Opposition will join us in recognising that the fundamental causes of unemployment, to which they referred in years past, still exist. We shall not solve the unemployment problem unless we tackle those causes. A vital element in tackling them must be trade union reform.

7.40 pm

Mr. Giles Radice (Chester-le-Street)

I shall not pursue the points made by the hon. Member for Wycombe (Mr. Whitney) in his general defence of the Government's economic policies, other than to express my surprise that supporters of free collective bargaining should be complaining about wage inflation in the way that he did.

We have heard a couple of constructive speeches from the Government Benches—one from the right hon. and learned Member for Hexham (Mr. Rippon) and the other from the hon. Member for Bedfordshire, South (Mr Madel). The Secretary of State for Scotland, however, advanced a negative case. He said that unemployment had been worse under the Labour Government. It certainly rose under the Labour Government, but it was falling in the last two years of that Administration's period of office, and since the Conservatives have come to power that trend has been decisively reversed. The figure has risen by 300,000 in a year.

The second point that the Secretary of State made was that inflation had to be squeezed out of the economy, and that, if unemployment resulted, that was too bad. It is true that the Government have squeezed the economy with high interest rates, cuts in public spending and an over-valued pound. That has created a recession about which the CBI is now complaining strongly. Of course, the recession has also created much of the unemployment that we are debating tonight.

Mr. Marlow

Will the hon. Gentleman give way?

Mr. Radice

No, not just at the moment. However, inflation has doubled in the last year and the prospects for its reduction look most unpromising.

The truth is that the unemployment figures are appalling, especially for young people, as almost every speaker in the debate has demonstrated. They are particularly bad for youth and for regions like the North, Merseyside, Scotland and Wales. We have heard the voices from those regions in the debate. The figures will get much worse.

The Secretary of State for Scotland argued that youth unemployment always rose at about this time, and that is so. There is a summer peak of school leavers. However, youth unemployment has risen threefold since the early 1970s, and the prospects, as any of the Manpower Services Commission regional offices will say, are worsening almost daily. The prospect of finding jobs and of absorbing youth unemployment are deteriorating every day.

Regional differences have been widening markedly since the middle 1970s. Regions like the North, Scotland and Wales have much higher levels of unemployment than has the South. The problem is that the Government have taken unemployment as very much a second order problem. They have greatly underestimated its impact, partly for political reasons. As my hon. Friend the Member for Neath (Mr. Coleman) explained, the Government feel that if they can give redundancy payments to the unemployed that might keep them quiet. It might be that since most of the Conservative majorities came from the South and the Midlands the Government feel that unemployment in the other areas will not matter too much politically.

The economic consequences of unemployment are most severe, however. There is the problem of lost output, the loss of tax revenue and the fact that unemployment increases the level of public spending—currently by £1.5 billion. There is also the impact on individuals. The report of the Manpower Services Commission put it very well when it said It cannot be emphasised too often that for the great majority of people unemployment is a painful, depressing and debilitating experience, and the longer it lasts the worse it gets. There is also the impact on particular communities. When there are large-scale redundancies, as in Consett, with perhaps 30 or 40 per cent. of male workers unemployed, the situation is disastrous. In parts of Sunderland, with the cutback in shipbuilding, 17 per cent. of male workers are out of a job. My hon. Friend the Member for Liverpool, Walton (Mr. Heffer) has his problems on Merseyside, as we know; and indeed the Select Committee on Employment has visited the area.

There is, then, the impact on the regions. If 9 per cent. of a region's workers are unemployed and job prospects are daily getting worse, with more redundancies and fewer vacancies, that creates a depressing effect upon the morale of the whole region. That is the impact that unemployment is beginning to have on our country.

What needs to be done? It is partly a question of economic policy. This debate is not the occasion to rehearse general economic arguments, but the Government must stop squeezing the economy, bring down interest rates and do something about the overvalued pound. I argue strongly for an incomes policy, and there is also a case for some selective import controls.

I wish to move on now to examine the Manpower Services Commission programmes. The youth opportunities programmes must be expanded. The Secretary of State has said many times that he has expanded them, and I accept that, but he will have to expand them much more if he is to meet the needs that exist. If 30 or 40 per cent. of young people are having great difficulty getting jobs, inevitably he will have to go much further.

Of course, the programmes are no substitute for permanent employment, and no one says that they are. But they are tremendously valuable in that they get young people off the dole queues. They give them something valuable to do and they give them self-respect, as anyone who has seen the programmes will know. These young people are being prepared for jobs and it is no accident that 70 per cent. of those who engage in the programmes subsequently find them. They are not locked into the hopelessness of long spells of unemployment.

In areas of particularly high unemployment, like Sunderland and Merseyside, when young people leave the youth opportunity programmes they go back to the dole. To get away from that, the programmes must be expanded for up to two years.

Something must be done about training, because a serious situation is developing in which employers and the Government are simultaneously cutting it back. That trend must be reversed. If industry is not prepared to do the training, the Government and the community must step in. If they do not, employment prospects will inevitably worsen. Instead of going for training, young people will go for jobs requiring less skill. The less able young people will then face greater competition and will be pushed out on to the dole as the process filters through the labour market.

Secondly, there will be a reduction in essential skills, which will permanently damage the country's economic prospects. I am sure that the Government do not want that—or, at least, I hope they do not.

Mr. Needham

I should like to clarify one point. The Government, through the MSC, are giving as much support to the industrial training boards this year and next year as in the past. Is the hon. Gentleman saying that that is not the case, and that the training budget is being cut back even further?

Mr. Radice

If we take the period to 1983, the programme is being cut back. If employers cut back on their training needs, the amount that the community provides must be expanded.

The Secretary of State for Scotland was very disingenuous about the long-term unemployed. He knows that he has cut back the plan from 36,000 to 12,000. But that is not good enough, when there will shortly be 500,000 long-term unemployed people.

The temporary short-time working compensation scheme has been particularly valuable in areas as the North and Merseyside. Firms now want the qualification period to be extended from 26 weeks to 52 weeks. That point was made to the Select Committee on Employment at Newcastle, both by the Engineering Employers Federation and by the TUC's northern region.

We must not forget regional policy. I was glad that the right hon. and learned Member for Hexham made a powerful plea for the development of regional policy. We must step up regional incentives. We must have greater employment subsidies for the regions, and a large public investment programme. We must also give more help to smaller firms in the regions.

Some Conservative Members believe in the concept of one nation. The right hon. and learned Member for Hexham is part of that strand in the Conservative Party, and I have always believed that the Secretary of State for Employment is also part of it. But the Government are rapidly creating two nations, one nation which is well-off, employed and by and large living in the South, and the other nation which is less well-off, increasingly unemployed, and by and large living in the North.

The Government think they can get away with this division of the country, but they greatly underestimate the gravity of the problem, and the temper of our people. In the end, the British people will simply not tolerate mass unemployment and possibly social unrest in some areas. I believe that they will reject that approach, and reject a Government who have so disastrously divided the nation.

7.54 pm

Mr. Peter Hordern (Horsham and Crawley)

>: I agree with the hon. Member for Chester-le-Street (Mr. Radice) about the gravity of the present unemployment position. Like him, I do not think that there is any prospect of an early recovery. It is of no benefit to the unemployed to tell them that unemployment has been brought about by the significant increase in the price of world oil; nor is it of much comfort to them to say that other developing countries, such as France. Italy and the United States, have a higher level of unemployment.

It is my belief—I hope that I am wrong—that the present level of unemployment is likely to increase for a measurable period before it gets any better. Despite the remarks of my right hon. Friend the Secretary of State for Scotland about improvements that might be made in the youth opportunities programme, and despite other measures which Governments of both parties have taken, at heart the House will agree that those measures are at best palliatives to what every school leaver wants—the reasonable assurance of a well-paid job in a developing economy. At present, that prospect is not open to him.

This matter is not new. We have had many debates on unemployment. Some hon. Members think that because unemployment rises as a result of substantial increase in wages an incomes policy is the best antidote, but we have tried incomes policies ad nauseam, and while there might be improvements for a short time, unemploment is much worse afterwards. In 1975–76, when wage increases were up by 26 per cent., the number of unemployed rose from 600,000 to 1.2 million in one year—a figure which the Leader of the Opposition ignored at Question Time yesterday. It seems that to the Leader of the Opposition statistics started with his Premiership in 1967. I do not know whether the years 1975 and 1976 will be ruled by the Labour Party to be non-events, but those are the figures.

During the last six months to May, wage increases have averaged 20 per cent. as a whole, and there cannot be much doubt that unemployment will increase substantially as a consequence. The solution is not to be found in incomes policies—statutory or voluntary. Experience shows that they only make matters worse.

I was not clear about the proposals of the right hon. Member for Glasgow, Craigton (Mr. Millan), but he complained that interest rates were too high. He mentioned the easing of interest rates and giving a boost to the economy by various measures, but we have tried them all. We have tried cheap money, artificially depressed interest rates, and subsidising the nationalised industries. That created more rapid inflation than otherwise would have been the case, and I do not think that that is a road down which we should travel.

In recent years the private sector has had to bear an increasing weight because of the development of the public sector. I am aware that that will not be generally acceptable as a thesis, but the number of people employed in the public sector between 1961 and 1978 increased by 1½ million, and at the same time the private, wealth-producing sector declined by 1 million. The number of people employed in the Health Service between 1961 and 1978 increased from 575,000 to 1.175 million. The number of people employed in the education service who neither lecture nor teach is now 717,000. Most of those people are part-time workers, but that number has risen by 319,000 in the last 15 years.

My right hon. Friends are making an admirable effort to contain the size of the Civil Service, but the same cannot be said of the weight of expenditure borne by the private sector for the increase in the number of people employed by local authorities and in the Health Service throughout the country. It is not simply a question of the size and number of public and civil servants. It is also the method by which they are paid to which I want to draw atention.

While my right hon. Friend the Secretary of State for Employment is present, I cannot help but ask why it is necessary for his Department to employ 17,000 people to pay out employment benefit while the DHSS employs 86,000 people to pay supplementary benefit to the families of those who are unemployed? Why cannot the two services be combined? If one is unemployed, one does not mind where the money comes from. I do not understand why such a large number of people should be employed within my right hon. Friend's Department in order to pay out those benefits. I should be grateful if he would reply to that point. It seems to me that the Government are trying to run a free enterprise economy within a public sector framework which would be much more typical of a Socialist State.

Another factor which makes the situation much worse is public sector pay. In 1955, when the Priestley Commission on the Civil Service recommended, for the first time, fair comparison with outside staffs as the basis for public sector pay, it did so at a time when the economy was in a very different state from what it is now. In that year, national output increased by 3.3 per cent., wages by 6.6 per cent. and prices by 6.8 per cent. There was a fairly close correspondence between wages and output. Output is now declining, wages are increasing by 18 per cent., and, including Clegg, by rather more than that in the public sector. In addition, twice as many people are now employed in the public sector as there were in 1955.

When Priestley recommended comparability, it was to take account of differences in other conditions of service outside the public sector, but that is not happening now. For example, I know that my right hon. Friend the Prime Minister has announced a special inquiry into the level of public service pensions and the benefit to public servants of index-linked pensions. but what about job security in the public service? It is a great deal better than it is in the private sector, particularly now.

Therefore, what should be the basis of public sector pay? I think that it should be to pay the rate, whatever that is, that will secure good and conscientious public servants. There should not be comparability on a basis that cannot properly be compared with that of the private sector. As it is, the cost of pay for a swollen public sector must now be met by borrowing, which is why we have such high interest rates at present.

Mr. Marlow

My hon. Friend said that people in the public sector should effectively be paid what the market requires they should be paid. At present, the public sector is very much dominated by centralised bargaining. Therefore, someone who lives in a part of the country that requires a large wage gets the same as someone living in another part of the country where only a small wage needs to be paid. Would it not be better if, in arranging its pay, the public sector had different levels of pay for different parts of the country which respected the market situation in those areas?

Mr. Hordern

My hon. Friend is right. Ideally, that is what I should like to see, but I recognise that there will be a great deal of difficulty before that excellent situation arises. The point that I am trying to make is that by any means of comparison that one likes to take—either growth in the public service over a number of years or by comparison with the numbers employed in the public service in overseas countries—far too many are employed in the public service. That is why sterling is so high at present, because in competition with the private sector the Government need to borrow so much money. Consequently, the level of sterling is much higher than it would otherwise be.

As every hon. Member knows, that is having a serious effect on industry which manufactures fairly basic products. This week I met the managing director of Delta Metal, which has a number of factories in constituencies throughout the country. Its factory in Crawley in my constituency manufactures brass taps. There cannot be anything more basic than a brass tap. The number of imports of brass taps has doubled in one year, and the share of the market that the Italians now take is 13½ per cent. compared with about 6 per cent. just a year ago. The reason is simple. The movement as between stirling and the lire has been 20 per cent. in the course of a year. Again, the reason for that is the high level of Government borrowing, which has kept interest rates up by far more than they would otherwise be and pushed sterling up too.

I agree with what was said about the serious position in the North and North-West. I should like to offer this suggestion to my right hon. Friend. I do not believe that the position will improve early or easily.

If one looks at the type of industries in the North and North-West, one realises that it is difficult to see why those industries should make an early or rapid recovery. I wonder whether we should not now review all our regional incentives. The fact is that if we abolished all the capital allowances and stock appreciation we could have a rate of corporation tax below 20 per cent.

I believe that it is wrong to perpetuate, continue and elaborate the number of regional aids that exist, instead of adopting a much simpler system of tax relief for companies, be they manufacturing or service companies. I ask my right hon. Friend to look at what has happened in Southern Ireland, where large firms have been attracted from overseas because the tax system is so simple and there is a flat rate 10 per cent. corporation tax for 10 years.

I believe that the Government ought seriously to look at that system. We shall not recover unless we are able to attract substantial firms from overseas into this country. That would be a much better and quicker way of reviving industry and enterprise, and I hope that my right hon. Friend will consider that suggestion.

Several Hon. Members

rose—

Mr. Deputy Speaker

Order. Before I call the next hon. Member, I remind the House that 12 hon. Members who have been here all day still wish to speak. There is just over an hour left for Back-Bench contributions, and I hope that hon. Members will keep their speeches short.

8.6 pm

Mr. Gerard Fitt (Belfast, West)

In his concluding remarks the hon. Member for Horsham and Crawley (Mr. Hordern) referred to Southern Ireland. I want specifically to refer to Northern Ireland.

For many years, from 1920 until 1972, there was in this House a convention which prevented Members representing Northern Ireland constituencies from debating unemployment. That convention existed because at that time there was the Stormont Parliament, which allegedly existed to deal with problems such as unemployment. It was a very cosy arrangement for hon. Members which suited them very well, because the attitude was that all the major issues which affected the people of Northern Ireland were matters for Stormont. Consequently, this House built up an atmosphere of ignorance about the real tragedy of unemployment and social deprivation in Northern Ireland.

Allied to that ignorance was an atmosphere in which Northern Ireland Members were reluctant to take part in what they termed a national debate, such as that which is taking place now. However, since the abolition of Stormont in 1972, it is the duty of this House—not the duty of anyone in Northern Ireland—to look into every aspect of the Northern Ireland unemployment figures.

Only today, the hon. Member for Antrim, North (Rev. Ian Paisley) made an appeal for the 12 Northern Ireland representatives to meet in Northern Ireland to discuss the unemployment figures. I believe that that is an erroneous attitude and that this House must be made aware of the terrible tragedy of unemployment in Northern Ireland. It is in this House that decisions must be taken to alleviate the agony and distress.

I have listened today to many hon. Members, particularly on the Labour Benches, expressing real concern about the social effect of unemployment on our young people if the present trend is allowed to continue. I do not have to think of what that social effect may be. It has been with me in Northern Ireland for the past 10 years.

The unemployment figure in Northern Ireland is 73,000. There has been an increase of 13,000 since the Government took office in May 1979. That increase was brought about by a combination of factors—the raging doctrinaire approach of the Government to their policies, the public expenditure cuts and the number of bankruptcies. Those appear to be continuing trends. Trade unionists in Northern Ireland are aware of all the trends. They have predicted that within two years unemployment in that small area of the United Kingdom may reach the awful figure of 100,000.

Many hon. Members have referred to the outlook for youngsters who see no possibility of finding a job. In Northern Ireland 14,000 youngsters under the age of 19 are on the unemployment register. There is absolutely no hope within the foreseeable future of their finding jobs. If that happened in other parts of Britain many would think that the youngsters would become socially disoriented, disenchanted or rebels against society. The 14,000 unemployed youngsters in Northern Ireland have grown up in an atmosphere that would not be understood by youngsters living in England, Scotland or Wales. They are 16, 17, 18 and 19 years of age. The oldest were 5, 6 or 7-year-olds when British troops were first brought into Northern Ireland in 1969.

Every day those youngsters have seen the British military on their streets. They have been subjected to personal searches as they walked through the streets of their cities, towns and villages. Both Catholics and Protestants have been awakened by the knock of the soldiers at 3 or 4 o'clock in the morning, and they have seen their parents and homes searched. That is bound to create an anti-social atmosphere in the minds of those youngsters. Now that they have left school, hoping to find work and to earn money to lead a normal social life, they find that the prospects are nil. How much more likely is it that they will become rebels against society?

Let us consider the ages of the youngsters sentenced to imprisonment and those already in prison. I do not have the figures, but I am sure that the Secretary of State for Northern Ireland would be able to tell the House that many of the youngsters who have engaged in violence, on both sides of the political and religious divide, were 16, 17 or 18 years of age when they committed the acts for which they are now serving terms of imprisonment.

I understand that tomorrow morning the Cabinet will meet to approve a constitutional proposal for a solution to the Northern Ireland problem. The Minister, if he deigns to reply to some of my observations, will not be able to tell me in all honesty that the economic position, the number of unemployed and the social deprivation in Northern Ireland will be a large part of the Cabinet's deliberations. We are told that those are matters for the Secretary of State for Northern Ireland. They are not matters for him—they are matters for the Government and the House.

The children to whom I have referred who have no prospect of employment are already socially disaffected. It will take many years, even in a period when there is some hope of employment, to bring them back into society.

Many hon. Members on both sides of the House have referred to the social effect on those unemployed for less than six months, more than six months, less than one year or more than one year. In Northern Ireland people are signing the unemployment register for 37 years. They are signing the register for 5, 10, 15, 20, 25, and up to 40 years. It is not a question of being unemployed for less than six months, less than a year or more than a year. Is it any wonder that, with the unemployment figures over the years, there have been the troubles that we have experienced in Northern Ireland?

I am not sure whether this happens in any other part of Britain, but there are people in Northern Ireland who sign the unemployment register every three months, every six months or every year. That is an indication that they will never be afforded the opportunity to find a job. This morning I read in a Northern Ireland newspaper that Ford in Northern Ireland is to pay off 150 workers—

Mr. James Dempsey (Coatbridge and Airdrie)

I wonder whether the hon. Gentleman would develop his argument a little further. Will he advise me why those people sign the register only every three months, every six months or every year?

Mr. Fitt

Those facts were given to me by the Secretary of State for Northern Ireland in answer to a series of Parliamentary questions. It is an indication that those signing the unemployment register have no possibility of finding employment. They do not have to attend the employment exchange to collect their money every week—it is sent to them by Girobank. That practice reduces the dole queue. They are written off. They are rejects from society.

One can imagine the psychological effect on a human being who is desperately searching for a job—who has tried his hardest to get a job—when he goes to the employment exchange one day and is told "You do not have to come here again. We will send your dole to you by Girobank. You can sign the register every three months." That person is being condemned to live in an atmosphere that should not be regarded as acceptable in any part of Britain.

I have already said that since the Government took office in 1979 unemployment in Northern Ireland has increased by 13,000. The Belfast shipyard is in danger once again. I have absolutely no doubt that the pragmatic and monetarist approach of the Government, if and when they have to decide between adhering to their policies and dismantling the Belfast shipyard, will mean that they will decide in favour of their policies.

I have made a special plea for Northern Ireland. I know that many regions in Britain would make exactly the same plea. That is why there is competition between areas, regions and hon. Members. The hon. Member who represents Ford in England and the hon. Member who represents Ford in Northern Ireland will both look after the interests of their constituents. There is even personal hostility and animosity building up between hon. Members in the interests of their constituents. That should never occur, and should not be tolerated.

I am not sure of the answer to the Northern Ireland problem. Tomorrow morning, the Cabinet will consider the constitutional proposals. No one can guarantee success.

To consider the problems of Northern Ireland in a purely constitutional sense—whether it should be Northern Ireland as it is at present, amalgamated with the Republic, or a federal State—is not the answer. The answer to the problem in Northern Ireland is to create jobs and to do away with social deprivation. That is the first priority. After that, all the other constitutional difficulties will erase themselves. The first object of the Government must be to try to increase the standard of living and to do away with the abject agony, distress and poverty which has for so long existed in Northern Ireland and been aggravated by the Government since May last year.

It seems to me that Government supporters are acutely embarrassed by the unemployment figures which were announced yesterday. We are told that this is a time not to snarl, sneer or criticise the state of the economy and the unemployment of our constituents, but, that there should be a bipartisan approach. I have never heard such a ridiculous argument. The Government's policies and actions and approach to economies and every facet of life in the United Kingdom are diametrically opposed to those held by the Opposition. We are asked not to sneer but to make a bipartisan approach. That is not possible. The Government have got the country into a position where 1,600,000 are unemployed because they have carried out their own policies and disregarded the advice given to them by the Opposition.

I repeat that many people, particularly young people, are unemployed in Northern Ireland. I refer specifically to Strabane, Derry, Cookstown, Newry and West Belfast where up to 30 or 40 per cent. of the male working population is unemployed. Those people are not snarling or sneering. They are cursing the day that the present Government were elected, and they will continue to curse them until they are removed from office.

8.22 pm

Mr. Paul Hawkins (Norfolk, South-West)

First, I should like to refer to the excellent spech by the hon. Member for Newcastle-under-Lyme (Mr. Golding). I have sat opposite him on him on several Committees. His was a profound and interesting speech full of knowledge. It was one of best speeches that we have heard today.

My first experience of unemployment was when I left school and went to my first farm sale. The farm had been let to a new farmer. It was 1932—the terrible depression not only in industrial areas but in the light lands of Norfolk where most of the land was being laid down to stick and dog farming. The labour force included practically the total membership of two small villages—45 families. At the end of the day's sale, three shepherds, two dogs and one boy were employed whereas previously 45 families had been employed. The whole scene in Norfolk and in the rural areas of Suffolk was much the same for several years before and after that. Though we are fortunate in East Anglia in not having the terribly high unemployment figures referred to by the hon. Member for Belfast, West (Mr. Fitt), I know something about the effects of unemployment and I never want to see that sort of thing again.

It seems almost unnecessary, after the speech by the hon. Member for Newcastle-under-Lyme, to ask that we should get away from the sterile arguments as to which party has done best in creating most unemployment. Each side has made out in the past that the other side was responsible. Yet we know in our hearts that we are all partly responsible. We have all been greedy. We have all asked for more than we have produced—not every individual, but every sector of the community, including hon. Members. We are all partly responsible. What good does reiteration of sterile statistics do for the unemployed school leaver or, for that matter, the skilled man who knows only one trade and whose works has closed? Nothing. In fact, it makes bitterness worse.

I do not pretend to have any startling suggestions to help to resolve this dangerous situation of high and rising unemployment, but I believe that we must be united over this matter. Despite what was said by the hon. Member for Belfast, West, I still believe that there is room for a bipartisan policy across the Floor of the House and in the nation to try to solve this problem, and the House should give a lead.

I believe that many of our difficulties stem from the popular concept of the Welfare State—a concept which its founders would not understand. They would not recognise it. For many years people have been led to believe—and they do believe—that they are entitled to State help regardless of whether they are the disabled, sick or unemployed whom the schemes are meant to benefit.

People have had dinned into them that they have rights but no responsibilities, that they should have annual salary or wage rises or increased perks whether their firm is prospering or not and that rules and behaviour on both sides of industry, business and the professions, perhaps sensible 25 years ago, should be clung to regardless of what our competitors are doing. These attitudes are as rigid in the legal profession as on the shop floor. I am convinced that they are one reason for our decline. We must modernise not only our plant and machinery, but our minds and thinking about the whole of our society, Government, the Civil Service and, of course, industry.

Another reason for unnecessary unemployment has been the extraordinary slackness of Government policy on immigration over the past few years. For all this period, immigration for our small, over-populated country, with high unemployment, has been far too high. I am referring not to legal immigration for people who are entitled to come here, but to visitors, students and others, who have been allowed to overstay because there is absolutely no way of checking whether they have gone.

Speaking of immigrants, from Iran alone I understand that for the past three years the figures have been over 300,000, over 200,000, and 170,000—the last figure available. How many have gone home? I have asked, but I cannot be told the answer. It seems probable, in view of the state that Iran is in today, that most of them remain here. They must be working at some job or other, or somehow drawing social security money.

The total in three years from one country is 670,000. Even if only half of that number remain, they are doing jobs which people who are here legally would be glad to do. We have been told how high is the unemployment among the coloured population who are legally here, who were born here and who ought to be helped first. Distasteful though it may be, we must find ways of chasing up those who are here illegally, particularly among those to whom I have referred.

I congratulate my right hon. Friend the Secretary of State on the responsible attitude which he has adopted towards labour relations. We are very fortunate, in these times of stress, to have a man—an old friend of mine—who is patently sincere and whom all trust, even if on occasions many disagree with him. To those of my hon. Friends who disagree, I would say that Acts of Parliament can go only a certain way. They cannot change men's minds or hearts. The hearts and the minds of people have to be won over by patient and sustained effort.

It is soul destroying for young men and women to remain unemployed. I have already spoken of my experience for several years in a rural area. I know how much more depressing it must be in the large towns and conurbations. I ask my right hon. Friend to produce a leaflet explaining in simple language the help that is available to the unemployed youth of this country to enable them to acquire skills and to keep alive the desire to work.

I do not believe that we are born with the desire to work. We have to work in order to earn bread for ourselves and our children and to maintain our families, but once people lose the habit of work it is very difficult to acquire it again. Work is a habit; it is not something that everyone will try to find without some spur.

Will the Secretary of State explain why the job release scheme cannot be expanded? In my part of the world I have had many requests from people who feel that the job release scheme—which even the previous Government were cutting back—should be extended.

I sincerely hope that the debate will lead to some fresh thinking across the Floor of the House.

8.33 pm

Mr. Eric S. Heffer (Liverpool, Walton)

It would appear that a new doctrine has been developed on the Government Benches in the debate today. Now that the Conservatives are in office, they do not want to be snarled at; they want a bipartisan policy. I cannot remember the Conservatives, when my party was in office, adopting bipartisan attitudes towards unemployment. Certainly there were occasions when we the Government were snarled at by the Opposition.

I can understand why Conservative Members are putting forward this new doctrine. It is because the Government are in an impossible position. We now have the highest level of unemployment for 50 years. There is no question but that the system of society supported by the Conservatives—the free enterprise society, which was to solve all our problems, once the free market economy was given full rein—has proved to be an utter disaster. It does not work. We cannot, therefore, be expected on the Opposition Benches to be non-partisan in our approach to the Government's policies.

I want to speak primarily about the awful position now existing in my part of the world, on Merseyside. I referred earlier to an interesting article in today's Liverpool Daily Post. The figures in the article illustrate the difficulty and problem. The article states: Literally thousands of Merseyside school leavers are chasing a handful of jobs. The exodus began at Easter and yesterday's figures show 11,085 now registered as unemployed—almost 5,000 in the Liverpool careers offices are alone. That gives us an idea of how many youngsters are unemployed.

The Liverpool Daily Post did a survey of offices in the region and it showed only 23 vacancies on the books. The paper lists the vacancies in the various offices. In Liverpool there were seven vacancies, in Sefton seven, in St. Helens three, in the Wirrall six and in Knowsley there were none. What prospects do our young people have? The situation is desperate. I am not surprised that mug gings have increased in the streets of Liverpool. I am not surprised that there are more break-ins and similar crimes. What are the youngsters to do? There is no hope for them.

Some youngsters were given the opportunity to work under the Labour Government schemes. However, once they finished they were back on the dole. That makes the situation even worse because the youngsters were given a taste of employment. It is hopeless. We must understand the misery in the homes of ordinary working people in Liverpool.

Sometimes I feel almost ashamed to walk round one working class estate in my constituency. On that estate 30 per cent. of the residents are unemployed. In every other house people are unemployed. What does one say to them? I am not talking about the last year alone. The situation has grown over a period. But, my God, it has become impossible in the last year. That is why the people there voted Labour. They know that under Labour they would have some protection. They knew that the Labour Party was deeply concerned about doing something to deal with the problem—and I was critical of my Government. The people were light to vote Labour. They knew that the policies advocated by the Conservative Party would lead to greater insecurity and hopelessness and to no future for their children. That is proving to be right.

My hon. Friend the Member for Belfast, West (Mr. Fitt) said that soon in Northern Ireland 100,000 would be unemployed. Already on Merseyside—and that is not the biggest area of Britain—98,000 people are unemployed. Last month 91,000 were unemployed. The figure has jumped by 7,000. We cannot be complacent about that.

When the Prime Minitser returned from her Venice trip she said that the greatest priority was inflation. Of course inflation is important. However, the greatest priority for the Western world, if we are to save it from destruction, is to deal with unemployment. That is the greatest problem. If we cannot solve that problem we shall be faced with social conditions and unrest that will lead to the de-stabilisation of Western Europe and ultimately to the rise of dictatorial Governments. That has been the case in the past. We need remember only what happened in Nazi Germany. The same conditions are being created. Conservative Members should tell the Prime Minister to make a fundamental change in the Government's policies.

Keynes has been quoted. Jokingly, I said that I preferred Harold Macmillan. The Government have repudiated Macmillan's concepts, although they were Keynesian. It has been said that one cannot spend one's way out of a crisis. However, I would argue that there is no other solution. Conservatives have apparently never heard of Roosevelt. He saved American capitalism from collapse. At that time those involved in big business attacked him. However, he saved them and he saved their system. That is the only way to get out of such a crisis.

The Government do not believe in interventionist policies. They have repudiated them. They do not believe in public expenditure. They are cutting public expenditure and, as a result, daft situations arise. The Minister boastfully told us today that 170,000 civil servants would not be replaced. That means that 170,000 jobs will not be available to young people with a good education. Such opportunities may be lost for ever. It is not only those with a poor education who find it difficult to get a job. Those with a good education will find it increasingly difficult to obtain work. The Government must make a U-turn. I accept the words of the right hon. and learned Member for Hexham (Mr. Rippon). He said that he did not want to call such a change a U-turn but that he would call it a change of direction".

If the Prime Minister is not prepared to change direction, Conservative Members will have to get rid of her. I say that in the interests of Britain and in the interests of our people. The Government must change their attitude towards public expenditure. They should follow the suggestion that appeared today in The Times. They should give more financial aid to youth opportunity programmes, youth training and so on.

We are witnessing a crisis, because this system of society has outlived itself. Those Conservative Members who have agreed with me so far, will not agree with me now. We live in a capitalist society, and it has failed. That system cannot solve the problems that we now face. The time has come for us to take a fundamental change of direction. We must change our approach towards unemployment. If we do not do that, the growth of technology will lead to increasing unemployment. We must organise our resources in a sensible way. As far as I am concerned, that means in a Socialist way.

8.44 pm

Mr. Richard Needham (Chippenham)

I do not mind whether or not we adopt a bipartisan approach. The unemployed are as unimpressed by hearts worn on sleeves as they are by the news that there are 500,000 jobs available as gardeners. We should not continually refer to the breakdown of one system in our society, or look for cataclysmic solutions to the difficulties that we face. If we sit down and are practical and sensible about the problems we may find some solutions.

There are as many people employed in this country now as there were 10 years ago. There are two main difficulties. The first is that the economies of the Western world face grave problems. It does not matter whether Labour is in charge or whether we are. We all face the same difficulties. As has been pointed out tonight, 1.9 million was the number of unemployed quoted in the forward review of the Manpower Services Commission when the last Government were in office. No one suggests for one moment that all these problems are the making of one side or the other. The problems are large and they cut across nations. We must face up to that.

At the end of the day we have roughly the same number of people employed in this country as we had in 1970. Therefore, what is the difference? The difference is that there are 600,000 fewer men and 1 million more women. The main reason for that is that the system of payment to young people who have left school in this country is very different from elsewhere. In our country perhaps 10 or 20 per cent. of those employed who are aged 16, 17 or 18 receive between £40 and £60 a week. Another 30 or 40 per cent. get £23.50 a week under the youth opportunities programme. The remainder find that there is absolutely nothing for them and they end up with £12.75 a week supplementary benefit. Is that a sensible way of going about our policy?

I know that the House dislikes quotes from the practices of foreign countries, but let us consider what happens in three of the countries that have been mentioned in the debate already today. I refer to Austria, Switzerland and Germany where unemployment, particularly youth unemployment, is low. One of the basic reasons for this is that the apprenticeship system in those countries takes on 50 per cent. of those who leave school. In Britain it is only 20 per cent.

I quote to the House the findings of the survey undertaken by the Anglo-German Foundation, whose panel consisted of a broad spectrum of people—and looking down the list I cannot see the name of any paid-up members of the Conservative Party. The findings of that survey were: Whatever happens to the economy as a whole, we do not believe that, unless major policy changes are made, the employment prospects for Britain's young people are going to improve at all fast. There is evidence of a secular increase in the levels of youth unemployment. There is evidence of employer preference in their recruitment for members of other groups in the community—married women, for example—in front of young people … In contrast to those in Britain young people in the OECD's high-apprenticeship countries—West Germany, Switzerland and Austria—have been suffering much less in the tougher labour market conditions since 1974. The high (and easily expandable) apprenticeship systems in those countries have the effect of partly insulating young people from the labour market and partly taking them out of it. They are partly taken out of it in the precise sense that their remuneration is not mainly the result of collective bargaining. Let us get this absolutely clear. One of the reasons why we have such high youth unemployment in this country—and I am not putting blame on the trade union movement—is that the unions negotiate on behalf of those in employment for wages which a vast majority of employers cannot afford to pay to young people. The jobs that youngsters of lower attainment levels used to do in years gone by are no longer done because the wage rates demanded for those jobs cannot be afforded.

In Germany the concept of apprenticeship spreads throughout the whole community. It is based on a subsistence wage plus pocket money. I ask my right hon. and hon. Friends to consider that, together with the TUC and the CBI. We must look at these problems construc tively instead of talking about cataclymic alterations, changes of course and the need to alter everything in our society.

The difficulty is that there is an inability to tackle a practical problem. I ask my right hon. Friend the Secretary of State to consider whether, through the introduction of a training allowance or taking 16 to 18-year-olds out of the collective bargaining process, as is accepted by the TUC and employers in the YOP programme, the age group coming out of school could be provided with a training apprenticeship scheme that allows them the ability to bridge the gap between school and work and gives them the opportunity for long-term full employment.

I do not believe that that is an impossible request for the Government to consider. We know that it works in the countries that I mentioned. The TUC and the Government are understandably worried about unemployment and the CBI is also concerned, because, if employers do not get sensible levels of skills from young people—and employers always cut back as soon as a recession comes—there will be a chronic shortage of skills—which we always seem to end up with—when the recession ends.

I ask the Government to look at that matter carefully. I beg the House not to try endlessly to seek extreme solutions from one side or the other when there are adequate practical answers if only we could discuss them sensibly.

8.51 pm

Mr. David Ennals (Norwich, North)

Unemployment is no longer a problem only for the hard-hit regions such as Scotland, Wales, Northern Ireland, Merseyside and the North. It is a growing problem for every region. For example, we have a rapidly growing problem in Norwich, where unemployment this month is up 5 per cent. on last month and up 15 per cent. on last year. Other areas in East Anglia, including Thetford, Diss, Beccles and Bungay, are also experiencing increased unemployment.

Future job prospects are also grim. The MSC has told us about the known redundancies and those to come, quite apart from the part-time working that many of my constituents have to do. As in other parts of the country, vacancies are down and the prospects are depressing.

Unemployment is a problem in the service industries—and it has not been caused only by the cuts in public expenditure—but it is mainly the manufacturing industries, such as footwear, that are feeling the pinch of the Government's policies. Two groups suffer most. The first is those who have been unemployed for six months or more and those pushed out of work in their mid or late fifties, with little prospect of getting back into employment. This heartless Government's reward for them is to reduce their unemployment benefit.

The other group has been mentioned widely in the debate. They are the young. The easiest way to cut back on a labour force is to allow workers to retire and not to make any new appointments. In those circumstances, the young suffer [...] We shall soon have a new genera tion of young people who will see themselves as having been rejected by the Government.

I warn the stubborn Prime Minister and her cowed Ministers that not only are they sowing the seeds of their own destruction and deeply damaging the industrial basis of our country, but they will create problems of mental instability, depression and lawlessness among those who are expected to go on to the jobless scrap heap over the next couple of years.

Even the Eastern Daily Press, which is no supporter of my party, says a leader today that unemployment may rise to 3 million or more under this Government. The article says: The Treasury has itself admitted that it thinks manufacturing output will be 6 per cent. lower in a few years time. The Government's claim that there is no better alternative to counter-inflation strategy is losing its remaining credibility quickly". As far as I am concerned, it has already lost its credibility.

8.55 pm

Mr. Tony Marlow (Northampton, North)

I wish to speak about the position of young people in circumstances of mounting unemployment. It is agreed that this is a world-wide problem and that the unemployment that already exists will, unfortunately, increase. I speak not only from a constituency point of view but as father of two 17 and 16-year-old sons. I have a personal interest in what happens.

This subject has been burdened over the years by some sloppy thinking. It has been mentioned that the greatest tragedy in a tragic situation is the position of the young unemployed. I agree that it is a tragedy for a young person to be unemployed. But the problems of a callow youth of 16 hardly compare with those of the father, aged 42 to 45, who has been working at a job all his life, who finds suddenly that his skills are redundant and has to tell his family of the problems that he now faces. To talk of the young unemployed—tragic though their position is—as the greatest tragedy, is wrong.

There is also a certain amount of sloppy thinking in the belief that our young people should be on a conveyor belt from school, through a job, to retirement at 65, and the grave. Why do we think that children should go into a job at 16 and remain nose to the grindstone for ever? We have allowed our young people to think in this way. I hear from my sons and their friends that they want to leave school and get out into a man's world, get a wage and be a man with everyone else. Is there nothing else that, at this age, they could do? We talk of the problem of youth unemployment. If one looks at the situation as an optimist rather than a pessimist, one could perhaps see it as an opportunity rather than a problem. Instead of regarding the matter as youth unemployment, we could regard it as inactivity or under-activity of young people. I know that this is wrong.

This is a time of life when young people want to be out, doing, achieving, striving and attaining. They want to be associated with other people. They want to be caring. It is a time of great compassion and conscience. It is a time, above all, of commitment—a time of energy, vision, enterprise and enthusiasm. As a House of Commons, we should want to move that enthusiasm in a way that will be good for young people and good for the country as a whole.

There are 950,000 young people leaving school this year. It is a peak year. This high level of people leaving school will occur for some time, as will the problems of unemployment, especially for young people. We do not want an ad hoc scheme. We want a scheme that will endure. We do not want palliatives that temporarily suppress statistics or disguise politically unpleasant facts. We want a radical, new and properly thought-out long-term scheme to deal with the problem.

The youth opportunities programme has much to commend it. Some people would say, however, that, in certain aspects, it is unimaginative, and does not fulfil completely the role that will be needed in the future.

Every other major country in Europe, excluding Ireland, has a scheme of national service. I am not suggesting for a moment that we should have the old-fashioned scheme of National Service, with everyone dressed in khaki. But it is an opportunity in other countries for people to do something for other people and to serve their own nation. What I am suggesting, and what I have been discussing with many groups within the country, is a scheme for what I would call national community service. I have discussed it with Community Service Volunteers, Outward Bound and the National Trust for Conservation Volunteers. I have discussed the matter with my hon. Friend the Under-Secretary of State for Employment—the hon. Member for Beeston (Mr. Lester)—and his Department. If we move in this direction, we could start to solve the problem and do the country a great deal of good at the same time.

The scheme would, of essence, be voluntary. It would be for young people between the ages of 16 and 21—for girls as well as boys. They would start, perhaps—it is only an outline of a scheme; there is much to be discussed yet—with, say, three months of Outward Bound training, in which the young people would get together, take on tasks and challenges together, work together, and find out more about each other and what they could do.

Having worked as a team and as a group, they would then be able to develop one of several options. The total scheme might be of a year's duration, so they would have nine months in which to go on to the next option. I can think immediately of three options.

Mr. Skinner

Will the hon. Gentleman's children do it?

Mr. Marlow

If the scheme were in being, I wish that they would.

The first option would be for social work, working within the community, helping to look after the growing army of elderly and infirm for whom we have yet to devise the proper caring resources; to work in the hospitals, and to help in nursery schools with young children.

The second option could be an environmental option, to do work in our city centres to tidy them up. There are areas of dereliction where much could be done to bring about improvements; to work in our national parks and on private estates. [Interruption.] I shall not take any more interventions, because many more hon. Gentlemen wish to speak, as the hon. Member for Keighley (Mr. Cryer) knows.

The third option could be a form of cadet national service, in which boys and girls between the ages of 16 and 21 could learn the basic military skills so that, if at a later stage we needed to expand our reserve forces or our civil defence forces, we would have trained people we could slot in.

There would be immense benefits for people taking part in this scheme. [Interruption.] I am sorry that the hon. Member for Keighley finds this amusing. I have discussed this scheme with many young people. Many young people have been very enthusiastic to participate. It would give them the opportunity to travel around the country to meet, group with group, black with white, in a mixed society, getting people together and taking them from their home background to another part of the country. It would let them test their skills at activities that they would not otherwise encounter, in parts of the country in which they would not otherwise live. It would let them grow up and mature together, so that at the end of the scheme they would be better able and better fitted to take on a job, and to select a job. After all, when many young people get the opportunity of a job, the only job for which they get the opportunity is the one in their neighbourhood.

Mr. Skinner

The hon. Gentleman's clothes are dropping off.

Mr. Marlow

I think that my clothes are all right.

Let us look at the subject of costs. One can do calculations about the cost of the scheme in any way that one likes. But what cost do we have at present? The people on the youth opportunities programme get £23.50 a week for work experience on employers' premises. The unemployed get £18.50 a week, I think. Those on supplementary benefit get .12.95 a week. There are other immense costs because of the social problems that we have with young people being inactive and having nothing to do. We get vandalism. We get trees uprooted. We get paint daubed on walls. We get windows smashed. We get people being taken to court and people going to prison. These are the hidden costs.

If we had such a scheme as this, not only would we cut out a lot of these costs but we would have a great deal of benefit. It would be educational for the people involved in the scheme. It would be benefiting society. We could have jobs done that we could not otherwise attempt to do. Further, money could be obtained from some of the jobs that would be done for private people. Some of the jobs which could be done eventually by this scheme could be some of the more boring arduous activities being done by local authorities at great cost, so there could be a saving there.

The problem of inactivity among young people is growing and will continue to grow. I believe that it will become so grave that we shall need a radical solution to it. I ask my right hon. Friend to investigate further the possibility of setting up such a scheme at some stage.

9.5 pm

Mr. Clive Soley (Hammersmith, North)

There should be only one aim for a civilised society, and that should be to provide employment, training or education for anyone able or willing to undertake it. The reason for that is that unemployment is destructive of the individual, destructive of the family and, ultimately, destructive of society. I had wished to develop that point and speak about Government policies, but time prevents that.

This issue cannot simply be linked to the strength of trade unions. The strength of trade unions is always thrown at us, but no one ever mentions the BMA or management. It is curious that when we speak of wages for ordinary people we say that they have to earn them, but when we talk of high incomes we justify increasing those incomes by saying that we will only get monkeys if we pay peanuts.

I direct my remarks to one specific problem and one vulnerable group—the ethnic minorities, with particular reference to young unemployed blacks. There is a special problem of language in this context, because I have heard the phrase used "The problem of unemployed blacks". We do not have a problem of unemployed blacks. There is a problem for unemployed blacks, and there is a problem of racialism.

If anyone doubts the latter, I ask him to dwell on the thoughts of those concerned in Nazi Germany. The Nazis said that they had a Jewish problem, and because they said that they had such a problem they devised a solution to it. They called their answer to that problem the "final solution". I put it to the House that Nazi Germany did not have a Jewish problem. Nazi Germany had racialism, and when we look at the unemployment rates of young blacks and other ethnic minority groups, we know that we have a problem of racialism.

The figures, as best I am able to get them—they vary from one area of the country to another—are difficult to quantify with accuracy. We estimate that in my own constituency of Hammersmith and Fulham 23 per cent. of black males under 20 are unemployed, compared with an overall unemployment figure of 9 per cent. The GLC's estimate of unemployment in the 16 to 24-year age group for those born of parents who were born in the West Indies is about 17.6 per cent., compared with about 6.3 per cent. for the indigenous GLC population. In the Metropolitan Police district the unem ployment figure for 1975 suggests an unemployment rate of 5.50 per cent. for white people, 12.30 per cent. for blacks, and 10.55 per cent. for Asians. Even on a conservative estimate those figures suggest that unemployment among young blacks is at least twice as high—and possibly three or four times as high—as for the white population.

I suggest that the bulk of that unemployment is caused by racist attitudes. When I speak of racialism, I distinguish between prejudice, which is often conscious and overt on the part of the person who practises it, and discrimination, which is much more difficult to deal with, because often the person who discriminates is unaware of it. That produces special problems for young blacks.

It means that a young black may apply for the same job as a young white person. The young black may have the same, or better, qualifications than the young white person and may have prepared himself for the job, yet he may not get it, and the subsequent feelings of frustration and bitterness causes the problem. If we had the political courage, we could deal with that problem. We could pass legislation to provide, as they do in the United States, that companies should employ a minimum number of people from ethnic minority groups.

It is more immediately important that we should do something to develop the pre-TOPS scheme. That programme is being drastically cut in my area. That will affect Asians and others whose social and educational skills are below the average of the people with whom they are competing, either because they have been born and brought up abroad—with resulting cultural and language difficulties—or because they have missed out at a number of educational and social levels. The result of that is that they are in a tougher position. I ask the Minister to comment on the problem and give some constructive thought to the needs of young unemployed blacks. We have already seen part of the problem in Bristol, and we shall see more of unless we do something about it.

It is particularly sad that we sometimes try to differentiate between public and private expenditure. The hon. Member for Northampton, North (Mr. Marlow) made a marvellous case for more public expenditure, but it will not be forthcoming. I cite the example of a drug company which makes large profits and is in the so-called productive sector. I choose that company not through any maliciousness towards drug companies, but simply to explain that those companies produce drugs to deal with problems, many of which have their roots in social and psychological proglems in the community. Those problems are themselves exacerbated or caused by cuts in public expenditure. There is a curious argument, therefore, about what we mean by wealth.

If we do not get this problem right there will be more race riots, more crime and more harassment of ethnic minority groups. Because they are on the streets they are visible, and, unless they are to stay in their homes and avoid contact with the outside world, they are vulnerable.

There will also be more depression and mental illness. It is no accident that the crime rate for men is higher than that for women, but the converse is true of mental illness. There are far more mentally ill women than mentally ill men. That says something about the structure of our society. Above all, it says something about the vulnerability of young men who go out on the streets and then get picked up for crimes.

I can give a brief example of the problems caused by housing difficulties. Not long ago an Asian, employed in a trade conventional to Asians, was offered a house by the GLC in South-East London. However, he lived in West London. He was told by the GLC that either he should give up the idea of a house or he should get rid of the job. He could not have both.

Ultimately, there is no question of the "Why work?" syndrome. There is either no work or there are special problems. We must deal with that and I ask the Minister to provide some answers to the problems of young unemployed blacks.

Mr. Deputy Speaker (Mr. Bernard Weatherill)

Mr. Eric Varley.

Mr. Ron Brown (Edinburgh, Leith)

On a point of order, Mr. Deputy Speaker. Is there no consideration for ethnic minorities in this House? No Scottish Back Bencher has been called to speak in this most important debate. That is most disgraceful because the people from my area are most concerned about unemployment and about the Government.

Mr. Deputy Speaker

The hon. Gentleman knows that it is extremely difficult in a debate of this kind to call every hon. Member who wishes to speak. When I was in the Chair earlier today, I made a plea for short speeches. I am afraid that it was disregarded by some hon. Members.

9.12 pm

Mr. Eric G. Varley (Chesterfield)

This has been a serious debate, and so it should have been because it is set against a most serious and sombre background and the most alarming employment situation since the 1930s. If anything, the position will get much worse. If it is any consolation to my hon. Friend the Member for Edinburgh, Leith (Mr. Brown), I am sure that we shall be returning to this subject on many occasions in the next few months and years.

I find it difficult to accept the proposition advanced by many Conservative Members that we should try to approach this question in a bipartisan way and that we should not criticise the Government. I exclude the right hon. and learned Member for Hexham (Mr. Rippon) and the hon. Member for Bedfordshire, South (Mr. Madel) from that. The right hon. and learned Gentleman directed his remarks against his Front Bench. I cannot agree that we on the Labour Benches should try to approach this subject without examining some of the Government's other problems and policies.

One by one the members of this Government are achieving records of a kind which no Minister in any Administration since the war has chalked up. The Secretary of State for Social Services is the first holder of his office or a similar office for 50 years who is actually cutting social benefits. The Secretary of State for the Environment is presiding over the worst house building programme for 40 years. The Secretary of State for Industry is masterminding the worst collapse of business confidence and investment that has taken place in the lifetime of any hon. Member. The Secretary of State for Employment—the right hon. Gentleman who used to bluster against the Labour Government from this Dispatch Box—has the double if dubious honour of presiding over the worst unemployment figures for 30 years. He regards it as his curious duty to take measures that increase unemployment and reduce the chances of finding a job for those who seek work.

In the past, the Secretary of State for Employment has been able to drone on about the record of the Labour Government. I and other hon. Members who served in that Government were in no doubt about the unacceptability of unemployment figures during our period of office, but we took measures to assist employment. The Department of Employment interpreted its duties by intervening to promote employment and to save jobs in many industries and regions. Whenever we introduced measures and policies to save jobs, the then Opposition voted against them. The Department of Employment carried out employment schemes which made a considerable impact on unemployment, and when we left office unemployment was falling month by month. Although the employable labour force had increased substantially during the period 1974–79, when we left office there were more people in work than when our period of office started.

Now we have a Government who have a whole battery of policies that are deliberately designed to force up unemployment. We have a Secretary of State for Industry who seems to revel in closing down factories and placing even prosperous companies in jeopardy. Judging from what the right hon. Gentleman said in the House last week, he even wishes to meddle with and jeopardise the prospects of Ferranti. The right hon. Gentleman prevents worthwhile new jobs being created. He told the House in a statement on the steel industry that Governments do not create jobs. But thousands of new worthwhile jobs for the future could be created if he allowed the Inmos project to go ahead and provided a second tranche of money. Approximately 3,000 new jobs would be created in a hard-pressed region of Britain.

We have a Chancellor of the Exchequer who is destroying jobs daily by his policies on interest rates and exchange rates. We have a Secretary of State for the Environment who is getting rid of essential jobs in local government. The Secretary of State for Social Services is doing the same in the Health Service, and the Secretary of State for Education and Science is doing the same in our schools.

What then is the Secretary of State for Employment doing about it all? Is he marching into the Cabinet Room and using the authority of his office to resist these unprecedented attacks on jobs? Is he saying to his colleagues in the Cabinet Room "I am the Secretary of State for Employment, and it is my duty to protect and promote employment"? Not that we can see. The Secretary of State is the first holder of his office who not only acquiesces in the attacks that his colleagues make on jobs, but actually, anxiously and zealously makes his contribution to those attacks.

I do not know whether the Secretary of State is ever a guest at those 8 o'clock breakfast meetings of the Prime Minister at Downing Street that I am told she is fond of holding, or whether he is invited along afterwards—

Mr. Skinner

Superwet.

Mr. Varley

—but when, at breakfast time or at any other time, the Prime Minister calls for cuts in expenditure, the Secretary of State for Employment is never at the back of the queue. He always rushes in with his offerings. Although he will no doubt make much tonight of the increase in the youth opportunities programme, his overall spending on job promotion schemes and training has been cut by millions of pounds in real terms.

The Secretary of State for Employment boasts that he is maintaining two guarantees on the youth opportunities programme which the previous Labour Government made—that every school leaver will be offered a place on the programme by Easter, and that 16 to 18year-olds who have been unemployed for more than a year will be offered a place. The Secretary of State must know that those guarantees—which were again given by the Secretary of State for Scotland this afternoon—are in peril, because yesterday he received a letter from the British Youth Council which said: We now learn that the Manpower Services Commission is indicating that these vitally important guarantees cannot be met next year if the planned cuts in MSC staff go ahead centrally and locally. This means that many school-leavers, particularly the most disadvantaged, will not find a place on the Programme. This would have disastrous effects on the credibility of the Programme. We know that the MSC has sent a letter to the right hon. Gentleman in which it said that further big cuts in services for the unemployed were wholly unacceptable—this is the Government's own MSC—and added: The latest request for a further 8 per cent. cut would mean that MSC staff would be reduced by more than a quarter as unemployment rises because of Government policies. The Commission's letter continued: The result would be damaging and irresponsible cutbacks in employment and training services and the MSC's special programme for the unemployed. I hope that the Secretary of State will tell us that he has the money to maintain the guarantees which were given this afternoon. When the Secretary of State for Scotland was asked about it, he did not answer. He blustered. If the right hon. Gentleman can now indicate that he has the money, I shall readily give way to him, but perhaps he would like to leave it until he speaks. I hazard a guess that this has not yet gone before the appropriate Cabinet committee, and that he has not yet won that battle with the Chancellor of the Exchequer. If the guarantees which the Secretary of State for Scotland gave this afternoon are to be honoured, it is vitally important that the money should be forthcoming.

When I spoke in the debate on unemployment last March, I was pessimistic enough to warn that unemployment on official and Conservative estimates would rise to 1.8 million by March of next year. It is now plain that those estimates were absurdly optimistic. We are nine months ahead of time and already we have nearly reached that figure. The fact is that the right hon. Gentleman is complacently residing over unemployment figures which would make any self-respecting Secretary of State for Employment hide his head in shame. I shall come to the figures in a moment. But to some extent the Secretary of State abandoned all concern—some say that he abandoned all self-respect—the day the Prime Minister publicly insulted him on television, and he just sat back and took it.

Indeed, we have now reached the stage when the Prime Minister does not herself deign to bother with insulting the Secretary of State. She leaves it to her junior henchmen, such as the Chief Secretary to the Treasury. He was on television the other day and challenged the Secretary of State and those who share his views that if they do not agree with the policies being pursued by the Chief Secretary they should get out. No doubt the Secretary of State for Employment will swallow that publicly with the nervous grin that he has on his face now and will privately engage in another bout of off-the-record briefing.

Even if the Secretary of State has abandoned all pride and responsibility for unemployment, he should at least take some notice of the pride of the young unemployed who want a decent job. He should concern himself with the youngsters who are suffering under the worst ever increase in school leaver unemployment—the youngsters who, according to the Secretary of State's own Department, are adrift in a youth labour market where there are 10 applicants for every vacancy.

I wish to give the House some facts about what the Government's brave new Britain has to offer school leavers as a part of Britain's overall unemployment. I am pleased to see that the Prime Minister has come into the Chamber. She is the person I wish to question because she is the person responsible. Everywhere in Britain we can pick up a local newspaper and see what the Government are offering youngsters. In my area the unemployment level is the national average. Some Conservative Members would say that I am fortunate. But a headline in the Derbyshire Times states: 'Dole queue beckons youngsters by the thousand. All my hon. Friends could point to similar situations in their constituencies. The article says: A thousand teenagers will be thrown on to the job market in work-starved North Derbyshire when the summer school term ends next month.… At Clay Cross the picture is equally grim. No fewer than 252 have registered—to compete for only five jobs. Those are the human facts behind the cold statistics. The future prospects are even worse.

Mr. Joseph Dean (Leeds, West)

Is my right hon. Friend aware that an answer to a written question given by the Department of Employment last week shows that in the traditional Conservative area of the South-West there was a job gain of 15,000, in the traditional Conservative area of East Anglia there was a job gain of 10,000, but that over the same period in the traditional Labour areas of Lancashire and Yorkshire there was a job loss of 42,000? Some of us do not believe that that is an accident.

Mr. Varley

The levels of employment in the North, the North-East, Wales and Scotland are extremely high. But the levels will rise also in the traditional South-East. There have been many closures—for example Bontextile Installations (Engineers), in Ellesmere Port, which is in a constituency that the Conservatives gained from Labour; F & H Footwear in Preston, where the number of redundancies in that one firm is greater than the majority which provided the Tory gain at the general election; "Q" Mark International at Rossendale, where the Conservatives gained a seat in the general election; Standroyd Mill at Pendle, Nelson and Colne, which was another Conservative gain at the general election. I wonder whether any of the four new Tory Members for those constituencies, and the many others who gained seats would be sitting on the Conservative Benches today if they and their leaders had told the constituents the truth about what a Tory Government would do to their jobs and their livelihoods.

As my right hon. Friend the Member for Glasgow, Craigton (Mr. Milian) pointed out earlier, school leavers have been given thankful and constructive advice on how to find work. The Sun newspaper has waded in with a school leavers' jobs guide which suggests that youngsters help with donkey rides. The article states: temporary jobs worth trying include baby-sitting, housework, gardening or taking dogs for walks. That piece of inspired journalism won its editor, Sir Albert Lamb, a knightood in the Birthday Honours List. No doubt the Prime Minister knew about that reward. These keen, eager, bright-eyed youngsters are being offered as human sacrifices on the altar of monetarism.

This is the first Government of any party to have decided to subject the country to an experiment based on a mystical doctrine. The Government Front Bench see visions and hear voices. They are the voices of Professors Hayek and Friedman. Nowhere in the world where the theories of these two dubious academics have been tested have they succeeded. So the Government have de cide to test the theories to destruction, even if it means the destruction of our whole economy.

This is the formula being followed by the Government to help the teenagers who are trying to get jobs. Inflation is to be cured by prices being raised—VAT, fuel, gas, school meals and prescription charges. Industry is to be galvanised by giving it the freedom of the bankruptcy court. The nation is to be made healthier by the closure of hospitals and health centres. We are to be better housed in fewer and more expensive houses, and the construction industry is to be destroyed at the same time. Our children's education is to be improved by cutting the school building programme, removing the equipment from them and sacking the teachers.

In 13 months the Government have certainly brought the country to this situation, but it will get much worse. If, 13 months ago, anybody had warned that the Tory Government would conduct themselves in such a way, those allegations would have been described as Labour lies. In fact, that is precisely what the Daily Mail did. Come to think of it, that is exactly what happened. But we all know that on this occasion, as on others, the poor old Daily Mail was the innocent victim of a malicious forgery. The list that I have given of Tory policies and their effect is not a collection of fantasies but an accurate description of the effect on this country of 13 months of action by the Government.

I do not know how the Prime Minister can take this. Yesterday she came to the House of Commons dressed in sober black. She should have come in sackcloth and ashes. In 1978, speaking from the Opposition Dispatch Box and referring to my right hon. Friend the Leader of the Opposition, then the Prime Minister, the right hon. Lady said: The right hon. Gentleman has achieved the extraordinary double not only of increasing unemployment but of having a considerable shortage of skilled labour. Yet the Prime Minister, who has increased unemployment, is sacking those who are involved in skillcentres and can do the training. She went on to say: Over the lifetime of this Government there has been a tremendous increase of about 731,000. The right hon. Lady was referring to unemployment. That increase was deplorable and regretted, but that was at a rate of 150,000 a year. The increase over the 13 months of this Administration has been 350,000—more than double.

In that same debate—I would not have believed it if I had not got the Hansard extract before me—the right hon. Lady said: The Prime Minister's record on unemployment is as bad as his record on inflation, and this is an extremely important point when people consider the record of a Government and how they shall vote next time."—[Official Report, 14 December 1978; Vol. 960, c. 936.] The right hon. Lady's record on inflation and unemployment is a cruel betrayal of the misguided and misled voters in those marginal seats who helped her to achieve power.

Over the next few months, unemployment will go up, and it will go up considerably—much beyond the 2 million mark mentioned in some of the estimates of a few months ago. We know that the figure for the long-term unemployed will go up to about 500,000—that is, those who have been out of work for more than a year. School leaver unemployment will go up by about 100 per cent. Bright-eyed youngsters will leave school only to be told by society that it has no use for them. Recent studies have shown that there is a connection between delinquency, criminal activity and unemployment.

It is the duty of the Prime Minister to foster economic conditions that will enable people to get jobs. Sooner or later, the Prime Minister will have to change her attitude to employment policies, to manpower policies and to training policies. For the sake of the health and stability of the nation, we hope that this will occur very soon. If she were to do that, we could have some of the bipartisan arrangements which have been mentioned today. If she were to change her policies, we could move actively, swiftly, urgently and contructively, and we could give them some support. But I suspect that the right hon. Lady will not change her mind, and that for the time being she will stay with these disastrous policies.

Tonight, therefore, Labour Members will vote as the people of this country would vote if only they had the chance.

9.36 pm

The Secretary of State for Employment (Mr. James Prior)

The right hon. Member for Chesterfield (Mr. Varley) has made a rumbustuous speech. I cannot say that it was a very constructive speech—unlike the speeches of some of his hon. Friends, including the hon. Member for Newcastle-under-Lyme (Mr. Golding), to whose speech I should like to refer later. It may not help him but I should like to do so.

Since much of the debate has centred around manpower policy and the special measures, I should like to take up the point raised by the right hon. Member for Glasgow, Craigton (Mr. Millan). He asked, first, whether the money was available for the youth opportunities programme for this year. Then he wanted to know whether it would be available for subsequent years, in view of the fact that the allocation appeared to be less than would be required for the number of young people who might need a youth opportunities programme.

The answer is that the number of young people leaving school and available for employment is likely to fall after this year—it reaches its peak this year—and therefore the figures that have been taken so far for subsequent years are lower than those we think are required for this year, when we have expanded very considerably. I can assure the right hon. Gentleman and the House that we shall have the money available for the youth opportunities programme to fulfil the pledges which have been given in the past, and which we have given again, for the continuation of the scheme. There is no question of money not being available for that purpose.

I want to make it perfectly plain—as many hon. Members have made plain in the course of their speeches today—that whereas we can help with a number of these schemes which are palliatives, and which can help to foster the movement of resources from declining sectors to those with potential for expansion, they can only act as an aid to sound economic, industrial and regional policies and must not be allowed to jeopardise those policies. In other words, we can help with these schemes but they are not of themselves an answer to our unemployment problem.

As the Manpower Services Commission pointed out in the manpower review which has been liberally quoted today: Lower unemployment requires more jobs and these are generated by the activities of employers (both public and private) operating in a competitive and efficient economy. Those are the words, not of my Manpower Services Commission but, as I am finding out rapidly, of an extremely independent tripartite body which does not mince its words on a number of subjects. There is no difference between us and the Opposition on that.

Mr. Robert Hughes

Is the right hon. Gentleman aware that the Manpower Services Commission today decided unanimously to protest strongly at the demands that he is making on it to cut its budget further, because it says that such a cut will lead to a reduction of one-quarter of its work force and make it impossible for it to do its job?

Mr. Prior

Already the commission is making a considerable reduction in the number of people that it employs. A reduction of about 16 per cent. will take place in the next three years. As part of the exercise to reduce the size of the Civil Service generally, I have asked the commission to consider making further cuts of 8 per cent. over three years. The commission wrote to me today saying that it does not think that it can make any cut in the coming year but that it will consider my request. When it comes to its budget and corporate plan in the autumn it will make a considered judgment. That is reasonable.

We accept that living standards could be improved if means could be found to bring unemployed resources into use in a way which would satisfy the needs of British and overseas consumers for goods and services without increasing inflation. The right hon. Member for Craigton suggested remedies which would add to our inflation problems. Whether we like it or not, inflation is at the root of our problems. Social injustices and economic inefficiencies are the result of inflation. Only by controlling inflation will we create the climate in which real jobs flourish and unemployment falls.

The priority of controlling inflation is not just a quirk of the present United Kingdom Government. It was agreed at Venice by a number of Governments of different political persuasions. Paragraph 4 of the communiqué said that the reduction of inflation was our immediate top priority and would benefit all nations.

Mr. Heffer

Will the right hon. Gentleman give way?

Mr. Prior

I will not give way at the moment.

The communiqué states: Inflation retards growth and harms all sections of our societies. Determined fiscal and monetary restraint is required to break inflationary expectations. This is a clear statement of the Government's general economic strategy and one to which it is heartening to see foreign Government's of varying political complexions subscribe.

The communiqué refers to the need for a continuing dialogue among the social partners. I think that a dialogue between management and work people has much to contribute and I should like to see that dialogue extended to the Government in every way possible. The NEDC is probably the best vehicle for expanding and extending that dialogue. We shall do all that we can to do that.

Mr. Ennals

Will the right hon. Gentleman give way?

Mr. Prior

No. I want to give way to the hon. Member for Liverpool, Walton (Mr. Heffer), if I give way to anybody.

One of the realities that we are seeking to establish is that unemployment will continue to increase if wage increases do not moderate to much the same rate as the growth in the money supply. That means income levels increasing less than past price increases. The issue is not whether real incomes must fall but whether that fall is concentrated on those who become unemployed. For too long, real incomes have been growing faster than productivity, at the expense of the profits and investment on which jobs depend.

The exercise of recent years makes clear the consequences of excessive pay settlements. For the past few years we have been overpaying ourselves in relation to our competitors. Their pay deals have more nearly matched increased productivity. As a result, they can afford high pay deals while remaining competitive. In Britain, high pay deals have meant that we have become less competitive.

In the third quarter of last year, the United Kingdom's normal unit labour costs, relative to the average for competing countries, were about 12 per cent. higher than in 1975, and 30 per cent. higher than the lower level of 1976. A further deterioration in competitiveness has probably occurred since then. That inability to compete shackles us and leads to job loss as the world recession sets in.

The challenge to everyone in British trade and industry is to match our pay more closely to our productivity, as our competitors do.

Mr. Bob Cryer (Keighley)

rose—

Mr. Prior

I am short of time and wish to continue my speech. If we do not match pay more closely to productivity, we shall suffer far worse unemployment than those countries. Of course, incomes are not the only explanation for the United Kingdom's inflation rates. Oil prices play their part, alongside our determination to reduce subsidies to nationalised industries and to switch from direct to indirect taxation. That must be admitted. However, incomes are the most relevant factor in today's debate.

If we were to follow the policies advocated by the Opposition there would be a massive increase in general taxation, or borrowing at extremely high interest rates.

Mr. Ennals

The right hon. Gentleman and his colleagues are involved in a great inflation campaign. Is it not like a slimming campaign, in which somehow or other two or three pounds are put on every week?

Mr. Prior

If I were the right hon. Gentleman I would keep pretty quiet. He was responsible for the social services, and for the National Health Service. We have had to pick up some of the bills that accumulated over those three years. They are the cause of much of the trouble that we are in. The right hon. Gentleman left us to honour the Clegg comparability awards. Last year's settlements for civil servants and for local Government staffs amounted to about £3,000 million of extra public expenditure that must be met. The right hon. Gentleman was partly respon sible for those settlements. Had the Labour Party won the election in May, it would have faced a higher rate of inflation now than when the Labour Government left office. They left office in the nick of time and they know it.

Mr. Heffer

Perhaps the right hon. Gentleman will explain what he and his hon. Friends will do about the unemployed youth in Liverpool, whom I have already described. Perhaps he will explain what they will do about the unemployed youth that my right hon. Friend the Member for Chesterfield (Mr. Varley) and other Opposition Members have described. What will he do about this issue? What plans have the Government got?

Mr. Prior

Serious as the problems are, anyone would think, after listening to interventions from the Opposition, that the problems had started only a few months ago. Let me take the figures for May 1974 to May 1975. During that period unemployment in the North-West increased by 51 per cent. In the first year of the Conservative Government it has increased by 18.4 per cent. I know that that is not good enough, but I shall come to that point later. As the hon. Member for Coventry, North-East (Mr. Park) said in last Friday's debate on the West Midlands, these problems go back far more than 12 months. That is true of unemployment generally.

Since 1960 there have been successive economic cycles that have involved higher levels of unemployment at their peaks and troughs. In 1966, the three-month moving average level of unemployment in Great Britain fell to about a quarter of a million. In 1969 and 1973 the low point was over half a million. In 1979 it was 1.2 million. At the bottom of the economic cycle in 1963, unemployment was half a million. In subsequent cycles it reached a similar level in 1968, nearly 900,000 in 1972 and nearly 1.4 million in 1977. That is a trend that shows clearly that past policies followed by both sides of the House have not succeeded. That is why we have changed our policies this time, and if Labour Members do not understand that they do not understand anything.

Similarly, we seem less able to sustain economic growth when we can attain it. The figures for growth of manufacturing output show that we are still not producing as many manufactured goods today as we produced in 1973. In each period we have done worse than in the period before. That is why when Opposition Members suggest the same old remedies they are not suggesting anything that can be made to work [Interruption.]—

Mr. Speaker

Order. Interruptions from a sedentary position which amount to barracking are quite unfair.

Mr. Cryer

On a point of order, Mr. Speaker—

Mr. Speaker

There can hardly be a point of order on my saying that barracking is out of order.

Mr. Cryer

It is not a point of order on your ruling, Mr. Speaker. You must appreciate that the reason for the anger on this side of the House is that the Secretary of State is not explaining what the Government—

Mr. Speaker

Order. The Secretary of State must make his own speech and he must be allowed to do so.

Mr. Prior

The reason why I refuse to give any forecasts is that when I look at the forecasts produced by the Opposition I realise that it is not wise to do so. The right hon. Member for Leeds. East (Mr. Healey) said in the Budget of 1976: The target the Government have set themselves is to get unemployment down to 3 per cent. in 1979".—[Official Report, 6 April 1976: Vol. 909, c. 240.] They were planning to do that by an increase in the GDP of 5½ per cent. a year and an increase in manufacturing output of 8½ per cent. a year. By the time they left office manufacturing output was lower than when they were elected. What right have they to lecture us about employment?

Mr. Jack Straw (Blackburn)

Will the right hon. Gentleman give way?

Mr. Prior

No. I had better get on with my speech.

Mr. Dennis Canavan (West Stirlingshire)

What have the Government done?

Mr. Prior

We have increased the youth opportunities programme this year by an additional 50,000 places. I have repeated the undertakings of previous Governments that everyone who leaves school this summer will have the opportunity of a YOP place by Easter. Far from cutting expenditure on training, the YOP and other special measures, we are spending more this year than ever before. Labour Members cannot take much credit there.

In 1979–80, more than 210,000 young people were helped by the programme. More than 130,000 were 1979 school leavers. We shall continue with the undertakings for this year and beyond to the school leavers and young persons who have been unable to find a job for 12 months. We are also designing other policies to help those in greatest need.

My hon. Friend the Member for Bedfordshire, South (Mr. Madel) mentioned open learning techniques. I believe that we ought to use all the available methods of better communications to help with the process of training and retraining. We must all understand that we shall need to retrain vast numbers over the next few years.

Mr. John Home Robertson (Berwick and East Lothian)

The right hon. Gentleman needs retraining.

Mr. Prior

It is not a question of training only for clerical jobs. People must be trained for the high technology jobs. We have doubled the numbers being helped in that way.

During the period of recession we have to make certain that our training policies are right so that the next time that expansion takes place—

Mr. Gerald Kaufman (Manchester, Ardwick)

When will that be?

Mr. Prior

Never, if we follow the Opposition's policies. We must ensure that the next time that we get into expansion we do not immediately run into the bottlenecks of the lack of skilled people that we have had in the past few years.

The message that I want to go out from the House is that we are doing every bit as much to help young people as did the Labour Government. The MSC review said: The main answer to these problems is a faster rate of employment growth which in turn depends on the control of inflation and the restoration of an efficient and competitive economy. It is to the objectives of a sustainable improvement in job prospects, through the control of inflation and the creation of an economy better able to compete in the world, that the Government's policies are directed.

When I was first elected to the House in 1959 we had a Local Employment Bill to give help when unemployment was over 4 per cent. The policies of the past 20

years have resulted in this country's unemployment getting worse. Because of that, this Government were elected last year. We shall see this thing through, however hard the time may be over the next few months.

Mr. Cryer

rose—

Question put, That the original words stand part of the Question:—

The House divided: Ayes 257, Noes 320.

Division No. 372]	AYES	10 pm
Abse, Leo	Dunn, James A. (Liverpool, Kirkdale)	Jones, Barry (East Flint)
Adams, Allen	Dunnett, Jack	Jones, Dan (Burnley)
Allaun, Frank	Dunwoody, Mrs Gwyneth	Kaufman, Rt Hon Gerald
Alton, David	Eadie, Alex	Kerr, Russell
Anderson, Donald	Eastham, Ken	Kilroy-Silk, Robert
Archer, Rt Hon Peter	Edwards, Robert (Wolv SE)	Lambie, David
Armstrong, Rt Hon Ernest	Ellis, Raymond (NE Derbyshire)	Lamborn, Harry
Ashton, Joe	Ellis, Tom (Wrexham)	Lamond, James
Atkinson, Norman (H'gey, Tott'ham)	English, Michael	Leadbitter, Ted
Bagier, Gordon A. T.	Ennals, Rt Hon David	Leighton, Ronald
Barnett, Guy (Greenwich)	Evans, Ioan (Aberdare)	Lestor, Miss Joan (Eton & Slough)
Barnett, Rt Hon Joel (Heywood)	Ewing, Harry	Lewis, Arthur (Newham North West)
Beith, A. J.	Faulds, Andrew	Lewis, Ron (Carlisle)
Benn, Rt Hon Anthony Wedgwood	Fitch, Alan	Litherland, Robert
Bennett, Andrew (Stockport N)	Fitt, Gerard	Lyon, Alexander (York)
Bidwell, Sydney	Flannery, Martin	Lyons, Edward (Bradford West)
Booth, Rt Hon Albert	Fletcher, L. R. (Ilkeston)	Mabon, Rt Hon Dr J. Dickson
Boothroyd, Miss Betty	Fletcher, Ted (Darlington)	McCartney, Hugh
Bottomley, Rt Hon Arthur (M'brough)	Foot, Rt Hon Michael	McDonald, Dr Oonagh
Bradley, Tom	Ford, Ben	McGuire, Michael (Ince)
Bray, Dr Jeremy	Forrester, John	McKay, Allen (Penistone)
Brown, Hugh D. (Provan)	Foster, Derek	McKelvey, William
Brown, Robert C. (Newcastle W)	Foulkes. George	MacKenzie, Rt Hon Gregor
Brown, Ronald W. (Hackney S)	Fraser, John (Lambeth, Norwood)	Maclennan, Robert
Brown, Ron (Edinburgh, Leith)	Freeson, Rt Hon Reginald	McNamara, Kevin
Callaghan, Rt Hon J. (Cardiff SE)	Freud, Clement	McQuade, John
Callaghan, Jim (Middleton & P)	Garrett, John (Norwich S)	Magee, Bryan
Campbell, Ian	Garrett, W. E. (Wallsend)	Marks, Kenneth
Campbell-Savours, Dale	George, Bruce	Marshall, Dr Edmund (Goole)
Canavan, Dennis	Gilbert, Rt Hon Dr John	Marshall, Jim (Leicester South)
Cant, R. B.	Ginsburg, David	Mason, Rt Hon Roy
Clark, Dr David (South Shields)	Golding, John	Maxton, John
Cocks, Rt Hon Michael (Bristol S)	Gourlay, Harry	Maynard, Miss Joan
Cohen, Stanley	Graham, Ted	Meacher, Michael
Coleman, Donald	Grant, George (Morpeth)	Mellish, Rt Hon Robert
Concannon, Rt Hon J. D.	Grant, John (Islington C)	Mikardo, Ian
Conlan, Bernard	Hamilton, W. W. (Central Fife)	Millan, Rt Hon Bruce
Cook, Robin F.	Hardy, Peter	Miller, Dr M. S. (East Kilbride)
Cowans, Harry	Harrison, Rt Hon Walter	Mitchell, Austin (Grimsby)
Cox, Tom (Wandsworth, Tooting)	Hart, Rt Hon Dame Judith	Mitchell, R. C. (Soton, Itchen)
Craigen, J. M. (Glasgow, Maryhill)	Hattersley, Rt Hon Roy	Morris, Rt Hon Charles (Openshaw)
Crowther, J. S.	Haynes, Frank	Morris, Rt Hon John (Aberavon)
Cryer, Bob	Healey, Rt Hon Denis	Morton, George
Cunliffe, Lawrence	Heffer, Eric S.	Newens, Stanley
Cunningham, George (Islington S)	Hogg, Norman (E Dunbartonshire)	Oakes, Rt Hon Gordon
Cunningham, Dr John (Whitehaven)	Holland, Stuart (L'beth, Vauxhall)	Ogden, Eric
Dalyell, Tam	Home Robertson, John	O'Halloran, Michael
Davidson, Arthur	Homewood, William	O'Neill, Martin
Davies, Rt Hon Denzil (Llanelli)	Hooley, Frank	Orme, Rt Hon Stanley
Davies, Ifor (Gower)	Horam, John	Owen, Rt Hon Dr David
Davis, Clinton (Hackney Central)	Howell, Rt Hon Denis (B'ham, Sm H)	Palmer, Arthur
Davis, Terry (B'rm'ham, Stechford)	Huckfield, Les	Park, George
Deakins, Eric	Hudson Davies, Gwilym Ednyfed	Parker, John
Dean, Joseph (Leeds West)	Hughes, Mark (Durham)	Parry, Robert
Dempsey, James	Hughes, Robert (Aberdeen North)	Pavitt, Laurie
Dewar, Donald	Hughes, Roy (Newport)	Pendry, Tom
Dixon, Donald	Janner, Hon Greville	Penhaligon, David
Dobson, Frank	Jay, Rt Hon Douglas	Powell, Raymond (Ogmore)
Dormand, Jack	John, Brynmor	Prescott, John
Douglas, Dick	Johnson, James (Hull West)	Price, Christopher (Lewisham West)
Dou[...]las-Mann, Bruce	Johnson, Walter (Derby South)	Race, Reg
Dubs, Alfred	Johnston, Russell (Inverness)	Radice, Giles
Duffy, A. E. P.	Jones, Rt Hon Alec (Rhondda)	Rees, Rt Hon Merlyn (Leeds South)
Richardson, Jo	Snape, Peter	Walker, Rt Hon Harold (Doncaster)
Roberts, Albert (Normanton)	Soley, Clive	Watkins, David
Roberts, Allan (Bootle)	Spearing, Nigel	Weetch, Ken
Roberts, Ernest (Hackney North)	Spriggs, Leslie	Wellbeloved, James
Roberts, Gwilym (Cannock)	Stallard, A. W.	Welsh, Michael
Robertson, George	Stewart, Rt Hon Donald (W Isles)	White, Frank R. (Bury & Radcliffe)
Robinson, Geoffrey (Coventry NW)	Stoddart, David	White, James (Glasgow, Pollok)
Robinson, Peter (Belfast East)	Stott, Roger	Whitehead, Phillip
Rodgers, Rt Hon William	Strang, Gavin	Whitlock, William
Rooker, J. W.	Straw, Jack	Wigley, Dafydd
Roper, John	Summerskill, Hon Dr Shirley	Willey, Rt Hon Frederick
Ross, Ernest (Dundee West)	Taylor, Mrs Ann (Bolton West)	Williams, Rt Hon Alan (Swansea W)
Rowlands, Ted	Thomas, Dafydd (Merioneth)	Williams, Sir Thomas (Warrington)
Ryman, John	Thomas, Jeffrey (Abertillery)	Wilson, William (Coventry SE)
Sandelson, Neville	Thomas, Mike (Newcastle East)	Winnick, David
Sever, John	Thomas, Dr Roger (Carmarthen)	Woodall, Alec
Sheerman, Barry	Thorne, Stan (Preston South)	Woolmer, Kenneth
Sheldon, Rt Hon Robert (A'ton-u-L)	Tilley, John	Wrigglesworth, Ian
Shore, Rt Hon Peter (Step and Pop)	Tinn, James	Wright, Sheila
Silkin, Rt Hon John (Deptford)	Torney, Tom	Young, David (Bolton East)
Silkin, Rt Hon S. C. (Dulwich)	Urwin, Rt Hon Tom
Silverman, Julius	Varley, Rt Hon Eric G.	TELLERS FOR THE AYES:
Skinner, Dennis	Wainwright, Edwin (Dearne Valley)	Mr. John Evans and
Smith, Rt Hon J. (North Lanarkshire)	Wainwright, Richard (Colne Valley)	Mr. James Hamilton.
NOES
Adley, Robert	Colvin, Michael	Gummer, John Selwyn
Aitken, Jonathan	Cope, John	Hamilton, Hon Archie (Eps'm & Ew'll)
Alexander, Richard	Cormack, Patrick	Hamilton, Michael (Salisbury)
Alison, Michael	Corrie, John	Hampson, Dr Keith
Amery, Rt Hon Julian	Costain, A. P.	Hannam, John
Ancram, Michael	Cranborne, Viscount	Haselhurst, Alan
Arnold, Tom	Critchley, Julian	Hastings, Stephen
Aspinwall, Jack	Crouch, David	Havers, Rt Hon Sir Michael
Atkins, Rt Hon H. (Spelthorne)	Dean, Paul (North Somerset)	Hawkins, Paul
Atkins, Robert (Preston North)	Dickens, Geoffrey	Hawksley, Warren
Atkinson, David (B'mouth, East)	Dorrell, Stephen	Hayhoe, Barney
Baker, Kenneth (St. Marylebone)	Douglas-Hamilton, Lord James	Heath, Rt Hon Edward
Baker, Nicholas (North Dorset)	Dover, Denshore	Heddle, John
Banks, Robert	du Cann, Rt Hon Edward	Henderson, Barry
Beaumont-Dark, Anthony	Dunn, Robert (Dartford)	Heseltine, Rt Hon Michael
Bell, Sir Ronald	Dykes, Hugh	Hicks, Robert
Bendall, Vivian	Eden, Rt Hon Sir John	Higgins, Rt Hon Terence L.
Bennett, Sir Frederic (Torbay)	Edwards, Rt Hon N. (Pembroke)	Hogg, Hon Douglas (Grantham)
Benyon, Thomas (Abingdon)	Eggar, Timothy	Holland, Philip (Carlton)
Benyon, W. (Buckingham)	Elliott, Sir William	Hooson, Tom
Best, Keith	Emery, Peter	Hordern, Peter
Bevan, David Gilroy	Eyre, Reginald	Howe, Rt Hon Sir Geoffrey
Biffen, Rt Hon John	Fairbairn, Nicholas	Howell, Ralph (North Norfolk)
Biggs-Davison, John	Fairgrieve, Russell	Hunt, David (Wirral)
Blackburn, John	Faith, Mrs Sheila	Hunt, John (Ravensbourne)
Blaker, Peter	Farr, John	Hurd, Hon Douglas
Body, Richard	Fell, Anthony	Irving, Charles (Cheltenham)
Bonsor, Sir Nicholas	Fenner, Mrs Peggy	Jenkin, Rt Hon Patrick
Boscawen, Hon Robert	Finsberg, Geoffrey	Jessel, Toby
Bottomley, Peter (Woolwich West)	Fisher, Sir Nigel	Johnson Smith, Geoffrey
Bowden, Andrew	Fletcher, Alexander (Edinburgh N)	Jopling, Rt Hon Michael
Boyson, Dr Rhodes	Fletcher-Cooke, Charles	Joseph, Rt Hon Sir Keith
Bright, Graham	Fookes, Miss Janet	Kaberry, Sir Donald
Brinton, Tim	Forman, Nigel	Kershaw, Anthony
Brittan, Leon	Fowler, Rt Hon Norman	Kimball, Marcus
Brocklebank-Fowler, Christopher	Fox, Marcus	King, Rt Hon Tom
Brooke, Hon Peter	Fraser, Rt Hon H. (Stafford & St)	Kitson, Sir Timothy
Brotherton, Michael	Fraser, Peter (South Angus)	Knox, David
Brown, Michael (Brigg & Sc'thorpe)	Fry, Peter	Lamont, Norman
Browne, John (Winchester)	Galbraith, Hon T. G. D.	Lang, Ian
Bruce-Gardyne, John	Gardiner, George (Reigate)	Langford-Holt, Sir John
Bryan, Sir Paul	Gardner, Edward (South Fylde)	Latham, Michael
Buchanan-Smith, Hon Alick	Garel-Jones, Tristan	Lawson, Nigel
Buck, Antony	Gilmour, Rt Hon Sir Ian	Lee, John
Budgen, Nick	Glyn, Dr Alan	Lennox-Boyd, Hon Mark
Bulmer, Esmond	Goodhew, Victor	Lester, Jim (Beeston)
Burden, F. A.	Goodlad, Alastair	Lewis, Kenneth (Rutland)
Butcher, John	Gorst, John	Lloyd, Ian (Havant & Waterloo)
Butler, Hon Adam	Gow, Ian	Lloyd, Peter (Fareham)
Cadbury, Jocelyn	Gower, Sir Raymond	Loveridge, John
Carlisle, John (Luton West)	Grant, Anthony (Harrow C)	Luce, Richard
Carlisle, Kenneth (Lincoln)	Gray, Hamish	Lyell, Nicholas
Chalker, Mrs Lynda	Greenway, Harry	McCrindle, Robert
Chapman, Sydney	Grieve, Percy	Macfarlane, Neil
Clark, Sir William (Croydon South)	Griffiths, Eldon (Bury St Edmunds)	MacGregor, John
Clarke, Kenneth (Rushcliffe)	Griffiths, Peter (Portsmouth N)	MacKay, John (Argyll)
Clegg, Sir Walter	Grist, Ian	Macmillan, Rt Hon M. (Farnham)
Cockeram, Eric	Grylls, Michael	McNair-Wilson, Michael (Newbury)

McNair-Wilson, Patrick (New Forest)	Pawsey, James	Stevens, Martin
McQuarrie, Albert	Percival, Sir Ian	Stewart, Ian (Hitchin)
Madel, David	Peyton, Rt Hon John	Stewart, John (East Renfrewshire)
Major, John	Pink, R. Bonner	Stokes, John
Marland, Paul	Pollock, Alexander	Stradling Thomas, J.
Marlow, Tony	Porter, George	Tapsell, Peter
Marshall, Michael (Arundel)	Powell, Rt Hon J. Enoch (S Down)	Taylor, Robert (Croydon NW)
Mates, Michael	Prentice, Rt Hon Reg	Taylor, Teddy (Southend East)
Mather, Carol	Price, David (Eastleigh)	Temple-Morris, Peter
Maude, Rt Hon Angus	Prior, Rt Hon James	Thatcher, Rt Hon Mrs Margaret
Mawby, Ray	Proctor, K. Harvey	Thomas, Rt Hon Peter (Hendon S)
Mawhinney, Dr Brian	Pym, Rt Hon Francis	Thompson, Donald
Maxwell-Hyslop, Robin	Raison, Timothy	Thorne, Neil (Ilford South)
Mayhew, Patrick	Rathbone, Tim	Thornton, Malcolm
Mellor, David	Rees, Peter (Dover and Deal)	Townend, John (Bridlington)
Meyer, Sir Anthony	Rees-Davies, W. R.	Townsend, Cyril D. (Bexleyheath)
Miller, Hal (Bromsgrove & Redditch)	Renton, Tim	Trippier, David
Mills, Iain (Meriden)	Rhodes James, Robert	Trotter, Neville
Mills, Peter (West Devon)	Ridley, Hon Nicholas	van Straubenzee, W. R.
Miscampbell, Norman	Ridsdale, Julian	Vaughan, Dr Gerard
Mitchell, David (Basingstoke)	Rifkind, Malcolm	Viggers, Peter
Moate, Roger	Rippon, Rt Hon Geoffrey	Waddington, David
Molyneaux, James	Roberts, Michael (Cardiff NW)	Wakeham, John
Monro, Hector	Roberts, Wyn (Conway)	Waldegrave, Hon William
Montgomery, Fergus	Ross, Wm. (Londonderry)	Walker, Rt Hon Peter (Worcester)
Moore, John	Rossi, Hugh	Walker, Bill (Perth & E Perthshire)
Morgan, Geraint	Rost, Peter	Walker-Smith, Rt Hon Sir Derek
Morris, Michael (Northampton, Sth)	Royle, Sir Anthony	Wall, Patrick
Morrison, Hon Charles (Devizes)	Sainsbury, Hon Timothy	Waller, Gary
Morrison, Hon Peter (City of Chester)	Scott, Nicholas	Walters, Dennis
Mudd, David	Shaw, Michael (Scarborough)	Ward, John
Murphy, Christopher	Shelton, William (Streatham)	Warren, Kenneth
Myles, David	Shepherd, Colin (Hereford)	Watson, John
Neale, Gerrard	Shepherd, Richard (Aldridge-Br'hills)	Wells, John (Maidstone)
Needham, Richard	Shersby, Michael	Wells, Bowen (Hert'rd & Stev'nage)
Nelson, Anthony	Silvester, Fred	Wheeler, John
Neubert, Michael	Sims, Roger	Whitelaw, Rt Hon William
Newton, Tony	Skeet, T. H. H.	Whitney, Raymond
Nott, Rt Hon John	Smith, Dudley (War. and Leam'ton)	Wickenden, Keith
Onslow, Cranley	Speed, Keith	Wiggin, Jerry
Oppenheim, Rt Hon Mrs Sally	Speller, Tony	Wilkinson, John
Osborn, John	Spence, John	Williams, Delwyn (Montgomery)
Page, John (Harrow, West)	Spicer, Jim (West Dorset)	Winterton, Nicholas
Page, Rt Hon Sir R. Graham	Spicer, Michael (S Worcestershire)	Wolfson, Mark
Page, Richard (SW Hertfordshire)	Sproat, Iain	Young, Sir George (Acton)
Parkinson, Cecil	Squire, Robin	Younger, Rt Hon George
Parris, Matthew	Stainton, Keith
Patten, Christopher (Bath)	Stanbrook, Ivor	TELLERS FOR THE NOES:
Patten, John (Oxford)	Stanley, John	Mr. Spencer Le Marchant and
Pattie, Geoffrey	Steen, Anthony	Mr. Anthony Berry.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to

Standing Order No. 32 (Questions on amendments):—

The House divided: Ayes 316, Noes 247.

Division No. 373]	AYES	[10.15 pm
Adley, Robert	Blaker, Peter	Carlisle, Kenneth (Lincoln)
Aitken, Jonathan	Bonsor, Sir Nicholas	Chalker, Mrs Lynda
Alexander, Richard	Boscawen, Hon Robert	Chapman, Sydney
Alison, Michael	Bottomley, Peter (Woolwich West)	Clark, Sir William (Croydon South)
Amery, Rt Hon Julian	Bowden, Andrew	Clarke, Kenneth (Rushcliffe)
Ancram, Michael	Boyson, Dr Rhodes	Clegg, Sir Walter
Arnold, Tom	Bright, Graham	Cockeram, Eric
Aspinwall, Jack	Brinton, Tim	Colvin, Michael
Atkins, Rt Hon H. (Spelthorne)	Brittan, Leon	Cope, John
Atkins, Robert (Preston North)	Brocklebank-Fowler, Christopher	Cormack, Patrick
Atkinson, David (B'mouth, East)	Brooke, Hon Peter	Corrie, John
Baker, Kenneth (St. Marylebone)	Brotherton, Michael	Costain, A. P.
Baker, Nicholas (North Dorset)	Brown, Michael (Brigg & Sc'thorpe)	Cranborne, Viscount
Banks, Robert	Browne, John (Winchester)	Critchley, Julian
Beaumont-Dark, Anthony	Bruce-Gardyne, John	Crouch, David
Bell, Sir Ronald	Bryan, Sir Paul	Dean, Paul (North Somerset)
Bendall, Vivian	Buchanan-Smith, Hon Alick	Dickens, Geoffrey
Bennett, Sir Frederic (Torbay)	Buck, Antony	Dorrell, Stephen
Benyon, Thomas (Abingdon)	Budgen, Nick	Douglas-Hamilton, Lord James
Benyon, W. (Buckingham)	Bulmer, Esmond	Dover, Denshore
Best, Keith	Burden, F. A.	du Cann, Rt Hon Edward
Bevan, David Gilroy	Butcher, John	Dunn, Robert (Dartford)
Biffen, Rt Hon John	Butler, Hon Adam	Dykes, Hugh
Biggs-Davison, John	Cadbury, Jocelyn	Eden, Rt Hon Sir John
Blackburn, John	Carlisle, John (Luton West)	Edwards, Rt Hon N. (Pembroke)
Eggar, Timothy	Lee, John	Rhodes James, Robert
Elliott, Sir William	Lennox-Boyd, Hon Mark	Ridley, Hon Nicholas
Emery, Peter	Lester, Jim (Beeston)	Ridsdale, Julian
Eyre, Reginald	Lewis, Kenneth (Rutland)	Rifkind, Malcolm
Fairbairn, Nicholas	Lloyd, Ian (Havant & Waterloo)	Rippon, Rt Hon Geoffrey
Fairgrieve, Russell	Lloyd, Peter (Fareham)	Roberts, Michael (Cardiff NW)
Faith, Mrs Sheila	Loveridge, John	Roberts, Wyn (Conway)
Farr, John	Luce, Richard	Ross, Wm. (Londonderry)
Fell, Anthony	Lyell, Nicholas	Rossi, Hugh
Fenner, Mrs Peggy	McCrindle, Robert	Rost, Peter
Finsberg, Geoffrey	Macfarlane, Neil	Royle, Sir Anthony
Fisher, Sir Nigel	MacGregor, John	Sainsbury, Hon Timothy
Fletcher, Alexander (Edinburgh N)	MacKay, John (Argyll)	Scott, Nicholas
Fletcher-Cooke, Charles	Macmillan, Rt Hon M. (Farnham)	Shaw, Michael (Scarborough)
Fookes, Miss Janet	McNair-Wilson, Michael (Newbury)	Shepherd, Colin (Hereford)
Forman, Nigel	McNair-Wilson, Patrick (New Forest)	Shepherd, Richard (Aldridge-Br'hills)
Fowler, Rt Hon Norman	McQuarrie, Albert	Shersby, Michael
Fox, Marcus	Madel, David	Silvester, Fred
Fraser, Peter (South Angus)	Major, John	Sims, Roger
Fry, Peter	Marland, Paul	Skeet, T. H. H.
Galbraith, Hon T. G. D.	Marlow, Tony	Smith, Dudley (War. and Leam'ton)
Gardiner, George (Reigate)	Marshall, Michael (Arundel)	Speed, Keith
Gardner, Edward (South Fylde)	Mates, Michael	Speller, Tony
Garel-Jones, Tristan	Mather, Carol	Spence, John
Gilmour, Rt Hon Sir Ian	Maude, Rt Hon Angus	Spicer, Jim (West Dorset)
Glyn, Dr Alan	Mawby, Ray	Spicer, Michael (S Worcestershire)
Goodhew, Victor	Mawhinney, Dr Brian	Sproat, Iain
Goodlad, Alastair	Maxwell-Hyslop, Robin	Squire, Robin
Gorst, John	Mayhew, Patrick	Stainton, Keith
Gow, Ian	Mellor, David	Stanbrook, Ivor
Gower, Sir Raymond	Meyer, Sir Anthony	Stanley, John
Grant, Anthony (Harrow C)	Miller, Hal (Bromsgrove & Redditch)	Steen, Anthony
Gray, Hamish	Mills, Iain (Meriden)	Stevens, Martin
Greenway, Harry	Mills, Peter (West Devon)	Stewart, Ian (Hitchin)
Grieve, Percy	Miscampbell, Norman	Stewart, John (East Renfrewshire)
Griffiths, Eldon (Bury St Edmunds)	Mitchell, David (Basingstoke)	Stokes, John
Griffiths, Peter (Portsmouth N)	Moate, Roger	Stradling Thomas, J.
Grist, Ian	Molyneaux, James	Tapsell, Peter
Grylls, Michael	Monro, Hector	Taylor, Robert (Croydon NW)
Gummer, John Selwyn	Montgomery, Fergus	Taylor, Teddy (Southend East)
Hamilton, Hon Archie (Eps'm & Ew'll)	Moore, John	Temple-Morris, Peter
Hamilton, Michael (Salisbury)	Morgan, Geraint	Thatcher, Rt Hon Mrs Margaret
Hampson, Dr Keith	Morris, Michael (Northampton, Sth)	Thomas, Rt Hon Peter (Hendon S)
Hannam, John	Morrison, Hon Charles (Devizes)	Thompson, Donald
Haselhurst, Alan	Morrison, Hon Peter (City of Chester)	Thorne, Neil (Ilford South)
Hastings, Stephen	Mudd, David	Thornton, Malcolm
Havers, Rt Hon Sir Michael	Murphy, Christopher	Townend, John (Bridlington)
Hawkins, Paul	Myles, David	Townsend, Cyril D. (Bexleyheath)
Hawksley, Warren	Neale, Gerrard	Trippier, David
Hayhoe, Barney	Needham, Richard	Trotter, Neville
Heath, Rt Hon Edward	Nelson, Anthony	van Straubenzee, W. R.
Heddle, John	Neubert, Michael	Vaughan, Dr Gerard
Henderson, Barry	Newton, Tony	Viggers, Peter
Heseltine, Rt Hon Michael	Nott, Rt Hon John	Waddington, David
Hicks, Robert	Onslow, Cranley	Wakeham, John
Higgins, Rt Hon Terence L.	Oppenheim, Rt Hon Mrs Sally	Waldegrave, Hon William
Hogg, Hon Douglas (Grantham)	Osborn, John	Walker, Rt Hon Peter (Worcester)
Holland, Philip (Carlton)	Page, John (Harrow, West)	Walker, Bill (Perth & E Perthshire)
Hooson, Tom	Page, Rt Hon Sir R. Graham	Walker-Smith, Rt Hon Sir Derek
Hordern, Peter	Page, Richard (SW Hertfordshire)	Wall, Patrick
Howe, Rt Hon Sir Geoffrey	Parkinson, Cecil	Waller, Gary
Howell, Ralph (North Norfolk)	Parris, Matthew	Ward, John
Hunt, David (Wirral)	Patten, Christopher (Bath)	Warren, Kenneth
Hunt, John (Ravensbourne)	Patten, John (Oxford)	Watson, John
Hurd, Hon Douglas	Pattie, Geoffrey	Wells, John (Maidstone)
Irving, Charles (Cheltenham)	Pawsey, James	Wells, Bowen (Hert'rd & Stev'nage)
Jenkin, Rt Hon Patrick	Percival, Sir Ian	Wheeler, John
Jessel, Toby	Peyton, Rt Hon John	Whitelaw, Rt Hon William
Johnson Smith, Geoffrey	Pink, R. Bonner	Whitney, Raymond
Jopling, Rt Hon Michael	Pollock, Alexander	Wickenden, Keith
Joseph, Rt Hon Sir Keith	Porter, George	Wiggin, Jerry
Kaberry, Sir Donald	Powell, Rt Hon J. Enoch (S Down)	Wilkinson, John
Kershaw, Anthony	Prentice, Rt Hon Reg	Williams, Delwyn (Montgomery)
Kimball, Marcus	Price, David (Eastleigh)	Winterton, Nicholas
King, Rt Hon Tom	Prior, Rt Hon James	Wolfson, Mark
Kitson, Sir Timothy	Proctor, K. Harvey	Young, Sir George (Acton)
Knox, David	Pym, Rt Hon Francis	Younger, Rt Hon George
Lamont, Norman	Raison, Timothy
Lang, Ian	Rathbone, Tim	TELLERS FOR THE AYES:
Langford-Holt, Sir John	Rees, Peter (Dover and Deal)	Mr. Spencer Le Marchant and
Latham, Michael	Rees-Davies, W. R.	Mr. Anthony Berry.
Lawson, Nigel	Renton, Tim

NOES
Abse, Leo	Fraser, John (Lambeth, Norwood)	Palmer, Arthur
Adams, Allen	Freeson, Rt Hon Reginald	Park, George
Allaun, Frank	Garrett, John (Norwich S)	Parker, John
Alton, David	Garrett, W. E. (Wallsend)	Parry, Robert
Anderson, Donald	George, Bruce	Pavitt, Laurie
Archer, Rt Hon Peter	Gilbert, Rt Hon Dr John	Pendry, Tom
Armstrong, Rt Hon Ernest	Ginsburg, David	Penhaligon, David
Ashton, Joe	Golding, John	Powell, Raymond (Ogmore)
Atkinson, Norman (H'gey, Tott'ham)	Gourlay, Harry	Prescott, John
Bagier, Gordon A. T.	Graham, Ted	Frice, Christopher (Lewisham West)
Barnett, Guy (Greenwich)	Grant, George (Morpeth)	Race, Reg
Barnett, Rt Hon Joel (Heywood)	Grant, John (Islington C)	Radice, Giles
Beith, A. J.	Hamilton, James (Bothwell)	Rees, Rt Hon Merlyn (Leeds South)
Benn, Rt Hon Anthony Wedgwood	Hamilton, W. W. (Central Fife)	Richardson, Jo
Bennett, Andrew (Stockport N)	Hardy, Peter	Roberts, Albert (Normanton)
Bidwell, Sydney	Harrison, Rt Hon Walter	Roberts, Allan (Bootle)
Booth, Rt Hon Albert	Hart, Rt Hon Dame Judith	Roberts, Ernest (Hackney North)
Boothroyd, Miss Betty	Hattersley, Rt Hon Roy	Roberts, Gwilym (Cannock)
Bottomley, Rt Hon Arthur (M'brough)	Haynes, Frank	Robertson, George
Bradley, Tom	Heffer, Eric S.	Robinson, Geoffrey (Coventry NW)
Bray, Dr Jeremy	Hogg, Norman (E Dunbartonshire)	Robinson, Peter (Belfast East)
Brown, Hugh D. (Provan)	Holland, Stuart (L'beth, Vauxhall)	Rodgers, Rt Hon William
Brown, Robert C. (Newcastle W)	Home Robertson, John	Rooker, J. W.
Brown, Ronald W. (Hackney S)	Hooley, Frank	Roper, John
Brown, Ron (Edinburgh, Leith)	Howell, Rt Hon Denis (B'ham, Sm H)	Ross, Ernest (Dundee West)
Callaghan, Rt Hon J. (Cardiff SE)	Huckfield, Les	Rowlands, Ted
Callaghan, Jim (Middleton & P)	Hudson Davies, Gwilym Ednyfeo	Ryman, John
Campbell, Ian	Hughes, Mark (Durham)	Sandelson, Neville
Campbell-Savours, Dale	Hughes, Robert (Aberdeen North)	Sever, John
Canavan, Dennis	Hughes, Roy (Newport)	Sheerman, Barry
Cant, R. B.	Janner, Hon Greville	Sheldon, Rt Hon Robert (A'ton-u-L)
Clark, Dr David (South Shields)	Jay, Rt Hon Douglas	Shore, Rt Hon Peter (Step and Pop)
Cocks, Rt Hon Michael (Bristol S)	John, Brynmor	Silkin, Rt Hon John (Deptford)
Cohen, Stanley	Johnson, James (Hull West)	Silkin, Rt Hon S. C. (Dulwich)
Coleman, Donald	Johnson, Walter (Derby South)	Silverman, Julius
Concannon, Rt Hon J. D.	Johnston, Russell (Inverness)	Skinner, Dennis
Conlan, Bernard	Jones, Rt Hon Alec (Rhondda)	Smith, Rt Hon J. (North Lanarkshire)
Cook, Robin F.	Jones, Dan (Burnley)	Snape, Peter
Cowans, Harry	Kaufman, Rt Hon Gerald	Soley, Clive
Cox, Tom (Wandsworth, Tooting)	Kerr, Russell	Spearing, Nigel
Craigen, J. M. (Glasgow, Maryhill)	Kilroy-Silk, Robert	Spriggs, Leslie
Crowther, J. S.	Lambie, David	Stallard, A. W.
Cryer, Bob	Lamborn, Harry	Stewart, Rt Hon Donald (W Isles)
Cunliffe, Lawrence	Lamond, James	Stoddart, David
Cunningham, George (Islington S)	Leadbitter, Ted	Stott, Roger
Cunningham, Dr John (Whitehaven)	Lestor, Miss Joan (Eton & Slough)	Strang, Gavin
Dalyell, Tam	Lewis, Arthur (Newham North West)	Straw, Jack
Davidson, Arthur	Lewis, Ron (Carlisle)	Summerskill, Hon Dr Shirley
Davies, Ifor (Gower)	Litherland, Robert	Taylor, Mrs Ann (Bolton West)
Davis, Clinton (Hackney Central)	Lyon, Alexander (York)	Thomas, Dafydd (Merioneth)
Davis, Terry (B'rm'ham, Stechford)	Lyons, Edward (Bradford West)	Thomas, Jeffrey (Abertillery)
Deakins, Eric	Mabon, Rt Hon Dr J. Dickson	Thomas, Mike (Newcastle East)
Dempsey, James	McCartney, Hugh	Thomas, Dr Roger (Carmarthen)
Dewar, Donald	McDonald, Dr Oonagh	Thorne, Stan (Preston South)
Dixon, Donald	McGuire, Michael (Ince)	Tinn, James
Dobson, Frank	McKay, Allen (Penistone)	Torney, Tom
Dormand, Jack	McKelvey, William	Urwin, Rt Hon Tom
Douglas, Dick	MacKenzie, Rt Hon Gregor	Varley, Rt Hon Eric G.
Douglas-Mann, Bruce	Maclennan, Robert	Wainwright, Edwin (Dearne Valley)
Dubs, Alfred	McNamara, Kevin	Wainwright, Richard (Colne Valley)
Duffy, A. E. P.	McQuade, John	Walker, Rt Hon Harold (Doncaster)
Dunn, James A. (Liverpool, Kirkdale)	Magee, Bryan	Watkins, David
Dunnett, Jack	Marks, Kenneth	Weetch, Ken
Dunwoody, Mrs Gwyneth	Marshall, Dr Edmund (Goole)	Wellbeloved, James
Eadie, Alex	Marshall, Jim (Leicester South)	Welsh, Michael
Eastham, Ken	Mason, Rt Hon Roy	White, Frank R. (Bury & Radcliffe)
Ellis, Raymond (NE Derbyshire)	Maxton, John	White, James (Glasgow, Pollok)
Ellis, Tom (Wrexham)	Maynard, Miss Joan	Whitehead, Phillip
English, Michael	Meacher, Michael	Whitlock, William
Ennals, Rt Hon David	Mellish, Rt Hon Robert	Wigley, Dafydd
Evans, Ioan (Aberdare)	Mikardo, Ian	Willey, Rt Hon Frederick
Evans, John (Newton)	Millan, Rt Hon Bruce	Williams, Rt Hon Alan (Swansea W)
Ewing, Harry	Miller, Dr M. S. (East Kilbride)	Williams, Sir Thomas (Warrington)
Faulds, Andrew	Mitchell, Austin (Grimsby)	Wilson, William (Coventry SE)
Fitch, Alan	Mitchell, R. C. (Soton, Itchen)	Winnick, David
Fitt, Gerard	Morris, Rt Hon Charles (Openshaw)	Woodall, Alec
Flannery, Martin	Morris, Rt Hon John (Aberavon)	Woolmer, Kenneth
Fletcher, L. R. (Ilkeston)	Newens, Stanley	Wrigglesworth, Ian
Fletcher, Ted (Darlington)	Oakes, Rt Hon Gordon	Wright, Sheila
Foot, Rt Hon Michael	Ogden, Eric	Young, David (Bolton East)
Ford, Ben	O'Halloran, Michael
Forrester, John	O'Neill, Martin	TELLERS FOR THE NOES:
Foster, Derek	Orme, Rt Hon Stanley	Mr. Joseph Dean and
Foulkes, George	Owen, Rt Hon Dr David	Mr. George Morton.

Question accordingly agreed to.

Mr. SPEAKER forthwith declared the main Question, as amended, to be agreed to, pursuant to Standing Order No. 18 (Business of Supply).

Resolved, That this House shares the concern at the rise in unemployment but recognises that in the face of many years of industrial weakness and the development of a world recession there is no quick solution; approves the actions of Her Majesty's Government in concentrating assistance in the area of greatest need and in increasing the size of the youth opportunities programme; confirms its support for the present policies designed to reduce inflation and urges all concerned to minimise unemployment by moderating the level of wage settlements.