HC Deb 05 March 1982 vol 19 cc511-73 9.34 am
Mr. Roger Moate (Faversham)

I beg to move, That this House, welcoming the Government's training initiatives and measures to stimulate small business and industry generally, being nevertheless deeply concerned at the levels of unemployment and in particular youth unemployment and noting that there are now parts of the region, notably in north and north east Kent, where the unemployment rate is as serious as the blackspots in the assisted areas, calls on the Government to give special recognition to the need to stimulate industrial activity in those localities, to improve urgently the road infrastructure and to encourage the development of tourism and the leisure industries. In the 12 years that I have been a Member of Parliament, this is the first time I have been successful in the private Members' ballot. As a believer in parliamentary brevity, I shall resist the temptation to cram into this one speech 12 years of waiting. However, the House will appreciate that it is a substantial motion covering a wide variety of subjects and Government Departments. Hon. Members will recognise the similarity between my motion and the one recently placed on the Order Paper by my hon. Friend the Member for Canterbury (Mr. Crouch), which was not debated, and I thank him for his inspired authorship. I have no doubt that he will contribute to the debate later and will deal with many of the inadequacies of my remarks.

I welcome the opportunity to place on the Order Paper a motion that allows us to discuss many of the problems and opportunities in Kent and the South-East. It raises some issues vital to the prosperity of our county and the region generally. It gives me and other hon. Members the opportunity to raise issues that we believe are important to our constituencies and also to dispel some of the illusions held by many people in other parts of the United Kingdom and in the House that the Garden of England is a land of milk and honey that has not been afflicted by the problems that beset us as an industrial nation. In Kent and the South-East we face the same problems of industrial change, the decline of our traditional industries, high unemployment in many areas, high youth unemployment and all the social consequences of what I call the productivity revolution that is taking place throughout the United Kingdom and Western Europe. In other words, we face the same problems as do many other areas.

It is vital for the House and Britain to understand that, as stated in the motion, there are some areas, notably in north Kent, where unemployment is actually or potentially worse than in some of the black spots in the assisted areas. Those areas are not only suffering from major structural unemployment; some have been struck even more serious blows, especially the decision to close Chatham naval dockyard and the BP oil refinery. I am sure that some of my hon. Friends, who have even more direct constituency interests than I, will deal with those specific issues later.

I wish to emphasise the serious impact of the closure of Chatham naval dockyard upon the whole area and to emphasise that that decision by the Government l as compounded an already serious position into a crisis. I am delighted to see my hon. Friend the Under-Secretary of State for Industry in his place; I hope that he will comment later. The effects of the closure go far beyond the Medway towns.

Mr. Keith Speed (Ashford)

The closure of Chatham dockyard, which is a direct Government responsibility, certainly spills over into Ashford, which is about 30 to 35 miles form the dockyard. If one adds to that the closure of the British Rail engineering works, which is an indirect Government responsibility, leading to the loss of many hundreds of jobs, and the problems that many firms are facing, the position in Ashford—which ironically is designated as the growth area of Kent—is every bit as bad as the position in areas mentioned by my hon. Friend. It highlights the need to construct the missing link of the M20 as soon as possible. I am sure that my hon. Friend will deal with that later in his speech.

Mr. Moate

I am grateful to my hon. Friend for emphasising the far-flung effects of the dockyard's closure. In my constituency up to 1,000 people could either lose their jobs or be forced to move as a result of the closure of the yard. My hon. Friend has emphasised that even in an area designated as an industrial growth area we face acute problems of industrial change, high unemployment, and high youth unemployment—matters to which the motion particularly relates.

I do not want to take up all the defence issues involved in the dockyard's closure, but I place on the record once again my view that the closure is a serious mistake in teens of industrial production and certainly in terms of defence strategy. I should like to believe that, even at this late stage, the Government will contemplate a change of policy. I do not believe it right to throw away the immense skills, espcially nuclear skills, that have been accumulated in the yard. I do not believe that it will be possible for the Government to maintain the SSN fleet—the nuclear submarine fleet—without the skills and experience of the Chatham naval dockyard. However, if they persist in that policy, as now seems sadly inevitable, they, having taken the decision themselves, will have some responsibility to help the area with some new initiatives.

My hon. Friend the Minister of State for the Armed Forces was courteous enough to write to say that he regretted that he could not be present during the debate to hear what was said about Chatham and the closure. I am grateful to him for his courtesy and for expressing his interest in whatever we had to say on this critical issue.

I shall emphasise the seriousness of the closure with statistics. In Medway it is estimated that when the dockyard closes unemployment is likely to rise to 22 per cent. I shall use other statistics to show that in the region we have black spots that are as serious as those in other parts of the United Kingdom. In February, unemployment in Kent was 11.4 per cent., which was slightly lower than the national average. However, Kent and the South-East generally were the only areas in which unemployment rose slightly last month; there was a slight decline in unemployment nationally. The United Kingdom figure is 12.6 per cent.

In the employment district of Sheerness, that is, the Isle of Sheppey, unemployment is 17.5 per cent. It is an important industrial area, and that scale of unemployment reflects both industrial change and the traditional problem that we have with many of the seaside areas in north Kent. Unemployment in the Chatham district is 14.6 per cent. I do not want to trespass into other constituencies, but unemployment in the Margate area is over 18 per cent.

If we compare the black spots that I have mentioned with others in, for example, intermediate areas, we find that unemployment in Swansea is 15.9 per cent., and in Morpeth, a development area, 15.9 per cent., while in Birkenhead it is 19.9 per cent. and in Consett 25 per cent. The figures demonstrate that in some other areas our problems are as acute as those in other parts of the United Kingdom. However, I do not believe it right to argue that generally the region's problems are comparable in scale or in character with those in the North-East, for example, or in Belfast.

The South-East has immense natural advantages, notably geographical advantages, which betoken a prosperous future. However, these advantages have to be encouraged and not discouraged in both our local and national interests. In the short term, local unemployment is unacceptably high. It is just as serious in human and social consequences for those concerned as it is anywhere else in the United Kingdom.

I am sceptical about using Government grants and incentives to persuade industries to establish themselves in other parts of the United Kingdom where basically it might not be seen initially as being in their best interests so to do. If we do that, we divert industry too often to areas that are not naturally the most advantageous economically. If we do that we are likely to end up with more De Loreans or Linwoods and we shall not be doing a long-term service to those areas. In so doing we are not always establishing long-term jobs.

Having said that, it would be foolish of me logically to ask for assisted area status or special Government help for even the black spots that I have described. I shall resist that temptation, although some of my hon. Friends may argue for such status or help. To do so is to initiate a legitimate debate. There are many things that the Government can and should do but I do not argue that the South-East should have assisted area status. That is not a tenable position.

I object when at a time of industrial change we are faced with positive Government encouragement to industry to move to other parts of the United Kingdom. I urge that that burden upon us should be removed, or at least be under constant and continuous review. It is an acute problem in many areas where we are trying to attract industry to industrial estates. There are splendid industrial estates, but industries that would have gone to them are diverted to other regions. When there are high rates of unemployment in our areas—I have mentioned that unemployment on the Isle of Sheppey is 17.5 per cent.—hon. Members on both sides of the House will understand our frustration when industry is attracted away from us when we need it just as acutely.

It is as much in the national interest as it is in our local interest to allow the naturally strong areas to grow stronger and to become more productive in the promotion of national wealth creation. Industries should not be diverted artificially to areas which might in the long term be unable to sustain them.

As the pattern of industrial change begins to affect the entire country, and as throughout the United Kingdom and the whole of Western Europe unemployment arising from industrial change increases, the pattern becomes almost universal and it is less and less sensible to distort the economic pattern by encouraging one area at the expense of another. The pattern of industrial change is becoming universal. Unemployment levels in the rest of Western Europe are reaching the United Kingdom's figures. That being so, it makes less and less sense to give grants, for example, to northern France and no grants to the South-East of England, South Wales or the North-East. We are all in competition with one another, and we are all facing the same problems.

I urge that industrial grants and regional grants be kept under constant review within Government and European policy so that the distortion does not continue.

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

My hon. Friend has raised a matter of great importance and in logic he is right. All areas are so much alike with their unemployment problems that one might abolish the whole system. However, has my hon. Friend considered the question of grants from the EEC, which are contingent on industrial assisted area status? Unless an area is industrially assisted, it cannot qualify for national EEC grants. There is clearly a case for abolishing area status, but if we do that we may at the same time abolish our right to claim grants from the EEC.

Mr. Moate

I said that the issue should be reviewed in the context of Government and European policy. Obviously these matters cannot be viewed in isolation. I recognise that I am asking for a much more fundamental consideration of regional policy. I recognise, too, that my hon. and learned Friend has been advocating that we change the basis upon which tourism grants are made, which, oddly, are linked to industrial policy.

Tourism fits into the context of my later remarks. There are some areas of policy in which the Government can and should take action which does not upset or affect regional policy.

Energy costs to industry have concerned me a great deal locally and may be seen as not being regional in any sense. In my constituency, we have substantial steel and paper industries. Both of them are intensive bulk energy users. Both have suffered from electricity costs which are higher than those of their competitors on the Continent. The survival of such industries depends on competitive energy prices.

Mr. John Prescott (Kingston upon Hull, East)

And subsidies.

Mr. Moate

We are talking not about subsidies but about changing the structure of electricity supply so that the bulk users can negotiate directly and commercially with the Central Electricity Generating Board as their rivals on the Continent do. I do not wish to become deeply involved in that subject. It is not a regional subject but a national subject. It is a critical issue for the industry of north Kent. I do not wish to pass by that point without registering it with my hon. Friend the Minister.

Mr. Prescott

What about subsidies? A positive policy to produce cheap energy reduces subsidies.

Mr. Moate

The hon. Gentleman keeps saying that.

I have made these remarks on at least half a dozen occasions before. We are grateful for the progress that has been made. With a bit of luck perhaps next Tuesday my right hon. and learned Friend the Chancellor of the Exchequer will recognise the need to help industry in that respect. He has done it before; I hope that he will do it again.

Without affecting regional policy, the Government can do something to help road infrastructure, to which my motion refers. There is an urgent need to improve the road infrastructure of the region. I am glad that the Government have begun to restore impetus to the road programme. It would be churlish not to recognise the improvements in some of our roads. The Boughton bypass is in my constituency. There is also the Canterbury bypass. However, in Kent and the South-East, we have not had the same investment in our road programme that many other areas have had.

The location of Kent in relation to London and Europe emphasises the fact that the transport structure there and the road infrastructure is of national, regional and local importance, yet instead of getting a greater share of the cake to enable us to cope with the bulk of the transcontinental traffic coming through the great Kent ports Kent's share per capita of the road programme has been lower that that for other shire counties. That is hard to justify when one considers the strategic importance of the roads in Kent.

I shall refer particularly to the M20. My hon. Friend the Member for Maidstone (Mr. Wells) has different views on that subject from many of his hon. Friends. There are nearly always two views about almost every road. I respect his point of view, but I disagree with it. It is hard to understand how a Government who are committed to the development of international trade can defer the construction of the missing link of the M20. It is about the most crucial road in the United Kingdom. It is of vital strategic importance. Yet the Government have decided to defer expenditure on the missing link.

I was disappointed to read yet again in the recent White Paper: The final section of the route of the M20 …has been fixed following a public inquiry; further work will have to wait until resources are available. It is hard to understand how the Government can make that decision on the route. It is harder to understand how they can put forward their heavy lorry proposals and expect the House to support them when they do not make the necessary road investment.

It would be churlish not to emphasise the importance of the priority that the Government are attaching to the M25 and its completion. The London orbital route will have an immense beneficial effect on Kent and the South-East. It has been often underestimated. About 76 miles out of the ultimate 120 miles have been completed or are under construction. That is great progress, but the motorway still has some way to go.

The M2 also goes through my constituency, but it is a two-lane motorway and is hopelessly overloaded at many times and in many places. We must think ahead to the time when the M2 is expanded to three lanes. If the M20 is not completed, more traffic will go on to the A2 and the M2. Therefore, it is important that a project for three lanes should be considered.

Almost all of us have local roads that we regard as being of vital importance. I am sure that other hon. Members will mention some. With road investment the Government can advance the interests of the South-East and of the nation without upsetting regional policy. They can attract industry to those areas. Nothing is more important than good communications for an industrialist who is planning investment in a certain area.

That is why I mention the A249, in my constituency, which leads to the port of Sheerness. We have had to fight time and again for every small section of that road. I am grateful for the fact that the Iwade bypass is now part of the programme and that the road will be trunked. The road leads to one of the fastest-growing ports in the United Kingdom. We should not have had to argue for it to be trunked and for every small section to be completed. 'The road will be improved, but there are still gaps. It will take years for them to be filled in, yet the road leads to a port that is growing at a rapid rate. Also, the industrial use of that road is growing fast.

Should we not be planning ahead, which we have often failed to do, for the 1990s when there will be a greater volume of traffic to and from the Isle of Sheppey? I emphasise the importance of getting on with such industrial routes.

There is a similar problem in the town of Faversham. An industrial route is planned there. The Faversham western relief road might be constructed in 1986 or 1987. It is an important industrial route, but it is still not firmly in the programme. That is another good example of where we need greater road expenditure in the South- East. I appreciate that that subject is not the responsibility of the Department of Industry. I hope that, if my hon. Friend the Under-Secretary cannot tell us today of his sympathy with the cause, he will urge the Secretary of State for Transport to give greater priority to the improvement of Kent's roads.

Another subject specifically mentioned in my motion is tourism. My hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies) has played a leading role, as have many of my other colleagues, in trying to improve the Government's recognition of the need to encourage tourism. I admit that I have been a little slow to recognise the immense potential and significance of tourism in our area. The Government have, too. At a time of industrial change, when it is expensive and difficult to create jobs in industry, we need to recognise the vital importance of expanding tourism. Already some 37,000 jobs are supported by tourism in Kent. In east Kent, more than one in 10 of the working population have jobs related to tourism. That emphasises the considerable importance of tourism and the leisure industries.

Nationally, tourism is our largest earner of invisible earnings. Therefore, it is difficult to exaggerate the importance of that service industry and its potential for generating employment. I recognise the determination of Kent county council to do what it can to ensure that tourism is encouraged throughout the county. At the same time, we face some decline in the traditional seaside holiday resorts. A very large number of people come to the Kent ports—500,000 people a year come through the port of Sheerness on the very successful Olau line, which is now investing in new ferries—but very few stay to spend their money in the county. Therefore, it must be right to try to encourage this as one of our great growth industries.

Is it not illogical, however, that all Government assistance and encouragement to tourism goes to the industrial assisted areas, based upon industrial need and high unemployment and not upon any logical assessment of whether they are natural tourist areas? Under section 4 of the Development of Tourism Act 1969 tourist projects to be supported by the Government must be in industrial assisted or intermediate areas. I know that my hon. and learned Friend the Member for Thanet, West has been battling about this for a long time. I suggest to the Minister that the Government can and should tackle it now.

I do not suggest that grants under the Development of Tourism Act are the be-all and end-all of the creation of new jobs in tourism. Clearly they are not. Commercially viable projects should stand or fall in their own right, but all that one hears suggests that the pump-priming effect of these fairly small grants may be quite significant. Often they help to raise the quality of the finished product and to encourage other lending institutions to put in cash, which is also important.

As my hon. and learned Friend the Member for Thanet, West said, this is linked with the subject of EEC grants, about which I am somewhat ambivalent. However, I am not ambivalent about getting back as much of our own money as we are passing to Brussels. If we can get that back in grants and loans, I am all in favour.

We are told that the cost of creating a permanent, full-time job in tourism is about £4,500, a very small capital investment compared with the cost of creating major industrial jobs. There is therefore great advantage to be secured from putting more money into tourism and encouraging investment of that kind. Moreover, we are talking about tens of thousands of jobs, not just a handful. Tourism is a very important industry.

I hesitate to return to the subject of the Chatham dockyard, but I wish to say a word about it in the context of tourism. I have already stressed that I believe that it should remain a dockyard. Nevertheless, if we are obliged to look to alternative future sources of employment for the area, one option would be to use that great area with its historic dockyard and adjacent basins to create an immensely important tourist project. There are great opportunities for the site, which has industrial disadvantages, but it will have to be tackled in a very imaginative way and will require some Government initiative and assistance.

I emphasise that that is just one of the options to be considered. We all have our pet ideas, but I could certainly envisage that area becoming one of the most magnetic and important tourist attractions in the South-East.

Sir Frederick Burden (Gillingham)

If the area were turned over to tourism, there would be certain advantages, but in employment terms the opportunities would be very small. We shall lose 7,000 jobs at the Chatham dockyard. Very few of them will be regained by using part of the dockyard for tourism.

Mr. Moate

I understand my hon. Friend's point. We are talking about a very different type of concept. It is important to remember that the dockyard provides immense opportunities for advanced engineering skills and for highly skilled and trained people. Tourism is quite different. Nevertheless, my hon. Friend perhaps underestimates the number of jobs that can be provided by tourism if the project is on a sufficiently large scale. However, I accept what my hon. Friend says and I certainly believe that this option should be rejected in favour of keeping the dockyard going.

I turn briefly to the importance of the training initiatives referred to in the motion, on which I shall make what may be regarded as a number of constituency points but which I believe have some national significance. As the motion makes clear, I welcome the Government's training initiatives. I believe that the new training initiative is one of the most imaginative and important steps taken by any Government for many years. It will bring us close to the levels of many of .our main competitors. Although there may be argument about certain features of the scheme, we must keep them in perspective and welcome wholeheartedly the target of guaranteeing for all unemployed 16-year-old school leavers a year's foundation training. With £1 billion going into the scheme in 1983, this is a dramatic step forward and one which will be of immense long-term importance even when many of our present problems have passed by and proved to be temporary.

The scheme has been described in my area as one of the most positive and creative actions taken this century, and I believe that it could ultimately develop into just that. That was said by a person for whom I have great respect and who is the controller of a community training scheme in my constituency. I should explain that Faversham is coterminous with the borough of Swale, to which I shall refer. The training scheme in Swale is an outstanding initiative which provides, I believe, an example for the rest of the country. I wish to deal with some of the issues that it raises as I believe that they have some national significance. First, however, I should say that in the Faversham constituency there are two examples of what I would describe as community self-help in trying to ensure that we grasp the industrial and training opportunities referred to in the motion.

Some years ago, an organisation known as "Voice" was established in my constituency. It was designed to be the voice of the major employers in the Swale area. It now covers 130 companies, employing some 12,000 people, which have come together and are working with great professionalism and determination for the promotion of local industry and of the whole area—the improvement of the amenities of the area, transport infrastructure, roads and the like. I emphasise their professionalism, their determination and their concern to promote the whole area. The organisation is remarkable, as it works very closely with the local council and its promotional activities are outstanding. I suggest that the rest of the country would do well to look to that employers' organisation as an example of how to promote industrial growth. I do not think that any other area has such a professional and highly motivated employers' organisation working closely with the whole community and with local authorities.

In July 1981, "Voice" gave birth to an organisation called SWIM—the Swale Work Initiation Measure, designed to tackle the growing problem of youth unemployment. It is now training some 200 youngsters and has 30 full-time employees. Its ultimate aim is to deal with a significant proportion of 600–700 young people the Careers Service anticipates will be without jobs or other training opportunities when the 1982 school leavers join the job market. I emphasise the community nature of this project because it was conceived by the employers in conjunction with the local council. The borough council will invest about £50,000 this coming year and, local employers are investing both cash and a great deal of help in kind—buildings, materials, vehicles and so on. The Government's Manpower Services Commission is backing it wholeheartedly. The project hopes to increase the 200 training places to 300 in October and, ultimately, to create even more. This is a classic example of the whole community working together to deal with youth unemployment, and it is a very impressive scheme.

I hope that the House appreciates that I emphasise the importance of this project because it can be emulated in other parts of Britain. I suspect that such schemes are being created elsewhere, but this is an oustandingly good example and it has been a great privilege to visit its various premises and observe what is being achieved.

By getting industrialists to co-operate in such a training scheme, there is a somewhat higher success rate afterwards in placing some of those youngsters in full-time permanent jobs. That is another encouraging point.

It is hoped that SWIM will become a conversion scheme as part of the new training initiative and will have a permanent role to play. If such schemes are to have a permanent training role, certain things must change. It is welcome that industry has supported such projects with materials and help in kind, but in the long term, presumably, under the new training schemes, the Government must supply the materials for projects of this sort. There must be a longer term funding basis for such projects, including materials, buildings and so on.

Furthermore, the new training scheme means that we shall place much more emphasis on workshops and classroom training, which means the provision of premises on a long-term basis instead of relying on short-lease premises or premises loaned by local industries. We must ensure that there is long-term provision. It has been suggested that the falling rolls and possible closure of some schools could be used by the education authorities as a way of providing permanent training facilities for organisations such as SWIM and generally in the context of the new training initiative.

I emphasise those points because it is instructive to appreciate how people are working together to promote youth training and because we must ensure that such schemes fit into the new training initiative and that, in this way hundreds and ultimately thousands of youngsters secure that important foundation training from such schemes. If the schemes are to work, we must deal with the sort of problems that I have described.

When referring to problems in Kent, I hope I have shown that we very much believe in self-help. We are not crying out for the sort of assistance being granted to many other areas. I have referred to the self-help of our employers' organisations, training organisations, county councils and local councils. It is unfair that we are hampered in our region by discrimination in industrial policy and that we have been hampered by a lack of investment in road infrastructure. I urge my hon. Friend and his colleagues in the Government to reconsider the question of discrimination against Kent, notably in tourism, roads and industrial investment. I particularly urge that in areas where Government decisions are creating problems—for example the closure of the naval dockyard in Chatham—they should accept some responsibility for trying to encourage the regeneration of jobs. The South-East is an area of immense opportunity. We want encouragement to develop the opportunities it provides, and I hope that my hon. Friend the Under-Secretary, when replying, will give us that encouragement.

10.16 am
Mr. Laurie Pavitt (Brent, South)

It is customary and, on this occasion, not just a formality to congratulate the hon. Member who has been lucky in the draw. However, I do so with a certain amount of envy because I have entered the ballot about 300 to 400 times but have never been successful in having my name pulled out of the hat. I know that the hon. Member for Faversham (Mr. Moate) will not worry about that, because I am lucky in love and one cannot be lucky in everything. I also congratulate the hon. Gentleman on the comprehensive nature of his speech. He covered a wide variety of unemployment problems and placed particular emphasis on his own area. All hon. Members have a framework on which they could relate the hon. Gentleman's problems to their constituencies. I am grateful to him for the way that he worded his motion, not just confining it to Kent—lovely as the Garden of England is—but also relating it to the South-East.

Although my constituency is not in Kent, it is in the South-East of England. Therefore, I take this opportunity to discuss the problems in my area. Another aspect that has always endeared the hon. Gentleman to me, apart from the fact that we share a knowledge of the Common Market and have a similar background philosophy, is that his constituency is associated with one of the famous House of Commons stories. His predecessor, Mr. Percy Wells, in that forgetful way of Members of Parliament, left his wife in the Strangers' Gallery and, when arriving back at Faversham at 1 o'clock, realised that some of his belongings were not with him.

The only aspect which I do not share with the hon. Gentleman is tourism because, in the inner-city areas of Harlesden, Kensal Rise and Stonebridge, there is no tourism but just many innner-city problems. However, most of the hon. Gentleman's comments concerning unemployment are typical of my area. I particularly take up a problem he raised that is too often not considered across the board between employment and environment—the infrastructure required for a successful commercial and industrial area.

When I first came to the House, Park Royal, an industrial estate in my constituency was a thriving engineering area. It is now a desert, almost entirely devoted not to skilled trades but to warehousing and jobs that do not require such large quantities of unskilled labour.

I have joined the Under-Secretary of State for the Environment, the hon. Member for Ealing, Acton (Sir G. Young) in his constituency role about a similar scheme to the SWIM scheme—the Park Royal trust. The local employers, trade unions and the two local councils concerned have organised a self-help organisation that seeks to increase the employment opportunities in that area by concentrating at first on the infrastructure. A few years ago, the GLC earmarked £1 million for road building in that area. The housing situation in my constituency is so bad that attracting new employment is exceedingly difficult.

For commuters, the area is approached, bumper to bumper, along the North Circular Road. There are also considerable delays for those using Westway and other arteries into London. The fact that 10,000 people are on the housing list also presents a pretty impossible situation. One consequence is that large firms have shifted out of the area into new towns such as Milton Keynes. I have seen factory after factory close. It is, therefore, a pleasure to welcome the self-help measures taken by the Park Royal trust. I am also pleased that the hon. Member for Ealing, Acton and I have been able to make a contribution by acting as original sponsors towards improving the infrastructure.

The immediate need is to create smaller units of work. I have addressed the House on a number of occasions about the closure of Park Royal Vehicles that had produced London buses since 1931 and eventually became part of British Leyland. While bankruptcies among small firms have increased, it is now also the giants in my area that face problems and the threat of redundancies. I can give three examples—Guinness, that makes an excellent brew of dark beer, United Biscuits, that makes a large range of biscuits, and a food firm making 57 varieties, including baked beans, called Heinz. I learnt, in discussions on Monday with the management, that there are to be 600 redundancies at Heinz. This is not an unsuccessful, uncompetitive or inefficient firm. It is a multinational company with a world-wide reptuation.

There are no labour relations problems. That has been the case since I entered the House. Yet the company is to declare 600 redundancies within the next three months. There has been an attempt to ameliorate the worst effects through early retirement but in an area where unemployment has doubled in the last 12 months, these further 600 redundancies represent a great tragedy for many families. To attempt to offer solutions would extend the scope of the debate. I shall not attempt to do so. I lay the blame at the door of the Government, whose economic policies have led not simply to bankruptcies among small firms but to an impossible situation for large firms, many of them important exporters.

Just before its closure, Park Royal Vehicles was making £3 million a year and exporting 400 double-decker buses to Hong Kong. However, in the economic climate that now exists, it was not a viable proposition. The attempt to find solutions has to extend much further than the beauties of the Garden of England or the inner city problems of my area. We are operating against a backcloth of a national economic policy that is unhelpful to the CBI, to the TUC and to school leavers.

Mr. Tim Brinton (Gravesend)

The hon. Gentleman says that the problems have been created by this Government's policies. To what does he attribute the rise in unemployment to 1.5 million before the Government came to office?

Mr. Pavitt

The doubling of unemployment from 1.5 million to well over 3 million took place in a very short space of time. If the hon. Gentleman considers economic history from 1970–1979, he will see that unemployment would have risen much higher had the Government not intervened with deliberate policies. The selective employment tax and regional employment premiums held back changing circumstances. I was losing ground in my area before 1979. Finns were moving out of the area. The difference is that what was a steady downhill run until 1979 has now become an avalanche. The rundown has accelerated.

I wish to take up another point made by the hon. Member for Faversham. I am also ambivalent towards the Common Market. However, as a result of negotiations involving, among others, Mr. Ivor Richard, the EEC Commissioner for regional development and a former Member of this House, it is likely that we shall get back some of our estimated contribution next year of £600 million. I think we have earned it. I should like to draw to the attention of the House an exciting venture that is taking place in my area. The constituency is a multi-racial community. It has the highest number of blacks—just over 33⅓ per cent.—in London. In the face of rising tension last year, I had expected Harlesden to go up in smoke before Brixton. It did not happen. This is due, to some extent, to the fact that the community relations council, the churches and everyone else were aware of the problem. I must also pay tribute, however, to the initiative of young blacks in the Stonebridge area.

This initiative, negative in the sense that it prevented a riot, has now flowered into a positive development offering employment. The London Transport bus depot at Stonebridge, which is no longer required, is for sale. The area where it is located is what might be termed a concrete jungle consisting of high-rise blocks of flats. Out of a population of 7,000, 80 per cent. are black. There has been no chance to give those people the feeling that they are part of a community. However, an exciting project has been launched called the Stonebridge bus depot project.

The depot will cost £2.5 million to buy. The London borough of Brent, showing a good deal of imagination, is providing £1 million and the Greater London Council a further £500,000. I am grateful to the Government for the co-operation already given by the Departments of Environment and of Employment. As a result, further help and assistance seems likely. It is already obvious that the project will be able to start. However, as hon. Members with families will know, a mother often thinks, when the first pregnancy is finished, that her troubles are over. The trouble really starts, of course, when the baby is born, and it continues for the next 20 years. The same applies to the project I have described. Getting it off the ground is a major initial step, but a good deal of solid practical work, involving disappointments and teething troubles, will be needed if it is to succeed in producing 20 co-operative concerns each employing between 10 and 40 people. This community co-operative will be multi-racial but no one can take away the credit from the initiators, who are black. It is their product.

One of the most exciting projects in terms of employment was in Spain the Mondragon co-operative of 1957. We might have to look to such schemes today rather than to the large multinationals becoming bigger and bigger. As the hon. Member for Faversham said, more self-help projects are needed. More individuals must get together and combine their skills to create work places and work forces that can make a useful contribution to the economy. More people should pull themselves up by their own bootstraps.

The hon. Member for Faversham was right to emphasise the importance of training. There is an urgent need not only for skilled training and productive service but for training in management techniques and in how to run schemes in a business-like manner. It is easy to have pipe dreams sitting in an armchair, but it is more difficult to turn them into reality in the market place. The hon. Member for Faversham was right to stress the need for education and training to ensure a successful end product. The project that I have described will go down in history, provided that the transitional first five years are successful.

Most young blacks in my constituency buy old bangers and spend each Sunday underneath them trying to make them go. The Stonebridge bus depot project will have a car maintenance co-operative. Youngsters will be able to join. A fitter will be employed and tools will be available. Youngsters will be able to book up time at the weekend so that they can put their cars right.

A similar co-operative project in another part of Brent has a fortnight to get off the ground. The first telephone installed in the House at the end of the last century was provided by a firm in my constitunecy, Halls Telephones. That firm became Associated Automation, which employs 550 people. In April it will close forever.

I have discussed the matter with Lord Weinstock of GEC, the parent company, as has my right hon. Friend the Member for Brent, East (Mr. Freeson). Perhaps with some technical advice from GEC we can turn that firm into a co-operative, although not to employ as many as 550, but it would save at least some jobs. I hope that such initiatives will be supported and that we shall not have to tolerate yet another closure with no compensating new avenues of employment.

There is a big gap between apprenticeship training schemes and colleges of engineering and polytechincs. There is a need for a closer liaison between local authority further education departments and companies involved in skill training.

The tragedy of unemployment in my area is compounded because the type of employment changes. The lack of a balanced social mix in a community creates many problems. Problems are caused if the community comprises the unskilled at one end of the scale and the commuting, managerial and skilled at the other. Not only is unemployment a problem but other social difficulties are caused.

I hope that as a result of the debate we shall hear of more initiatives. The Department of Employment probably has a bigger headache than any other Department in trying to solve the problems. A greater input of public expenditure is needed. The problems will be outlined in the Budget proposals. All the Secretaries of State have been arguing for months about whether their Departments should have priority. I hope that the Secretary of State for Employment has been successful in getting money for youth training schemes. I hope that he has achieved the financial support and backing required to expand the labour force, not decrease it further.

I can give the House figures. All hon. Members can bandy the figures about, but each person on the dole is a personal human tragedy, not a statistic. Families face deprivation and their standards of living are cut. In my young day the problem was whether the kids had shoes. Today, the problem is whether, when the kids go to school, they are comparable with their classmates in what they talk about and do. Personal tragedies cannot be expressed in statistics. In the last three years at my Saturday surgery I have watched heartbreak after heartbreak. We can offer no immediate comfort. hope that eventually a complete change of economic policy will give us a chance to move in the way that I have described across the political boundaries.

10.36 am
Mr. Archie Hamilton (Epsom and Ewell)

I am grateful for being given the opportunity to speak because, although the debate pertains directly to Kent, it also applies to the South-East generally and therefore to Surrey, of which my constituency is a part. Surrey is affected by unemployment and has its problems.

Let us examine the statistics. According to the latest Department of Employment Gazette nearly 700,000 people in the South-East are unemployed, or about 9.2 per cent. of the working population. Of these, 513,000 are men and 186,000 are women. A disturbing fact is that 27,100 are school leavers. Hon. Members on both sides are particularly concerned that people are leaving school with no job to go to.

The hon. Member for Brent, South (Mr. Pavitt) is right to say that we should not think only in terms of statistics. We are talking about human hardship and people who are suffering and whose families are experiencing grave problems. The problem is made worse because the work force is, in many ways, conservative. Generally, people are reluctant to change their jobs or to move around. Most people try to remain with the same company for most of their working lives. The shock and general dislocation when a company folds or declares redundancies is greater if a person has been in the job for a long time. We are unlike the Americans, who make a habit of changing jobs and moving round the country.

We have experienced an extremely harsh recession. It is without doubt the harshest recession since the war and perhaps for even longer. It has a particularly devastating effect on small businesses. I have been directly affected. In the manufacturing sector small businesses often live off the surpluses of larger businesses. The second that recession strikes, many bigger businesses pull in the work that they have subcontracted. The recession might affect the turnover of a large business by 10 per cent., but it could affect the turnover of small businesses by 50 per cent. or more. They do not cut orders in line with their lack of orders but they might halve them. That has made life extremely difficult.

Some companies with larger reserves have been able to soften the blows of the recession. They have shaken out labour, which has contributed indirectly to unemployment, but that has often been done through natural wastage, early retirement and so on. Small businesses have taken the brunt of the recession. I know that that is true in my constituency.

We have also seen, in larger companies, negotiations with unions leading to increases in productivity that have enabled those businesses, which had some slack capacity, to become more productive. That option was not open to small companies, which have been more productive anyway, and have not had spare capacity.

The South-East is suffering from unemployment for the first time. Previous recessions have tended to pass by the South-East and have had greater effects in other parts of the country. Of the 700,000 unemployed in the South-East, 223,000 are white collar workers, including 88,000 in the management and professional category. It cannot be suggested that only the unskilled or one sector of the working population are being hit. The problem is spread across professions and various walks of life.

About 374,000 of the unemployed in the SouthEast—over 50 per cent.—have been out of work for up to 26 weeks. It seems that people find it difficult to get a new job, but well over half do so within six months. About 162,000 of the unemployed—nearly one quarter—have been unemployed for between 26 and 52 weeks. It is taking them up to a year to find a job. No one could claim that that is bearable. It takes those people a long time to find a job, but at least they have one in the end.

About 163,000 people in the South-East—the remaining quarter—take over a year to find another job and some must despair of ever finding one. About 40,000 of those people are over 55. I admit that in my constituency there are one or two people, who were in very well-paid jobs with firms such as oil companies, who are prepared to retire people early on fat pensions.

A constituent wrote to me saying that her husband and her brother-in-law, one aged 55 and the other 61, had been retired on very good pensions and viewed the future without too much concern, but because of the system in this country they had to go on the dole and be registered as unemployed. Neither could be described as suffering hardship and it is ridiculous that they should be included in the unemployment figures.

About 86,000 of those who have been unemployed for more than a year are aged between 25 and 54, but even in a time of full employment there would still be quite a large number of people who, for one reason or another, would be virtually unemployable. The most distressing figure among those who have been unemployed for more than a year is that 37,000 are under 25. It is worrying that so many young people cannot find jobs.

I support the Government's measures to retrain young people. Everything must be done to ensure that they find employment and get the training that they need. It was encouraging to hear from my hon. Friend the Member for Faversham (Mr. Moate) of community projects helping to get young people into work. There is an element of enlightened self-interest in that, because when we come out of the recession we shall run into the old problem, particularly in the South-East, of shortages of skilled labour. We shall not have trained workers and it would be a good idea to start training them as soon as possible.

The Government have nothing to be ashamed of in their efforts to help the unemployed. About 558,000 people throughout the country were benefiting from special employment measures at the end of January. The Opposition may accuse us of being hard-faced and unsympathetic, but the statistics show that much more is being done than many may suppose.

There were 33,000 vacancies, spread across a variety of jobs, in the South-East at the end of January. There is a ghastly notice on the outside of county hall reminding us that about 336,000 people in London are unemployed. That figure is included in the overall South-East figure of 700,000.

However, it is interesting to learn that it is impossible to get people to be parking meter attendants. It is not the best-paid job, it is unpleasant in bad weather and drivers are often abusive when they find that a ticket has been stuck on their car, but people must be making the economic decision not to work for the wages of a parking meter attendant. They prefer to grub along on the dole money. There can be no other reason. London has a reasonable transport system and there is no reason why people should not travel to work as parking meter attendants.

Other unpopular jobs are difficult to fill. The Post Office has problems recruiting postmen because they have to start early in the morning and one hears of restaurants and hotels having difficulty finding people who are willing to work late in the evening, even in quite highly paid jobs. People do not like the anti-social hours and they make economic decisions about what to do with their lives. I would have it no other way, but if people were really desperate such jobs would not be available.

There is also a thriving black economy. The chairman of the Inland Revenue has produced figures showing that there is a large cash economy. That may not benefit only the unemployed, but I believe that some of the stresses of unemployment have been eased by the black economy. If a person can increase his take-home pay, whether it is from a State or anywhere else, by about £10 in cash every week it makes his problems slightly less unbearable.

We also have an extremely high number of women workers, compared with our Continental partners. There may be a number of cases where a man is out of work, but his wife is working and that helps to cushion the problems of his finding another job.

In the week ending 12 December last year about 328,000 people worked an average of eight hours' overtime. the overtime worked in that week totalled 2,714,300 hours. On the basis of a 40-hour week, that is the equivalent of 67,850 jobs. That is a significant number in this part of the world.

We have organised our working life on a primitive concept. We have always had the idea of a weekend. When standing charges were not great that did not matter much, but rent for factories is by no means cheap in the South-East. Rates are becoming a major cost to industry. There are also other charges, and depreciation of plant, and so on. Those are all outgoings seven days a week, although the factory often operates only five days a week. That is an inefficient way to organise matters. We should consider continuous shift working. People could work four days on and four days off, rolling one shift after the other.

It is difficult to suggest such a programme for existing businesses. Considerable dislocation is involved in moving from one system to another. But with new factories, instead of employing 100 people for five days, working 40 hours, in a 300 sq ft factory, 120 people could be employed in two shifts, working for 32 hours, and being paid for 32 hours. That would mean four days on and four off, a much smaller factory and less plant. There would be the problems of having a sufficient number of people to supervise the two shifts, and of plant maintenance, which is normally done over the weekend. But it would mean that to produce an identical amount the factory would employ 120 instead of 100 people. We should consider how to increase employment in our new businesses.

The trade unions say that they are concerned about unemployment, but it would be encouraging to see them press for shorter hours for less money. They should ask their members to make a sacrifice for the unemployed and to work fewer hours to create more jobs. There could be negotiation with management on the shop floor. The trade union movement could play a great role in increasing employment. Unfortunately, it is much more concerned to look after the interests of people in work, who pay their dues, than of those who do not have jobs.

The trade unions parade on the streets, but it is little more than hypocrisy, bolstering the opposition to the Government. They are extremely disappointed with the antics of the Opposition and feel that they must make better protests on the streets. But it is in their hands to help the unemployed, and it involves sacrifices by people in jobs. A lot more could be done. The trade unions are selfish in looking after only the interests of people who have jobs, without worrying too much about those who do not.

Improvement in the economy generally will help more than anything to get people back into jobs. The signs are good. There is growth in output, albeit from a low level. Productivity has improved dramatically. We shall see marked improvements in the private sector in company profitability, which is extremely important. Over the years we have seen nothing but declining profits. Industrial relations are much better. The number of disputes has dropped significantly.

Most economists believe that this year we shall see a 1 per cent. growth in GNP. Although not spectacular, it is a move in the right direction. People talk in terms of a further growth of perhaps 1½ per cent. in 1983. It will take time for the Government to get to grips with inflation, but the belief now is that it will not increase much further and may come down. There have been great problems in controlling productivity and the pricing structures of the nationalised industries, which probably has more to do with the monopoly control of the unions than anything else. Had the industries been in the private sector they would either have had to shake out or go to the wall. But the taxpayer and the consumer have had to pay for their inefficiencies, so inflation is much higher than it would otherwise have been.

Mr. Prescott

Does the hon. Gentleman believe that the closed shop arrangement in the gas industry has anything to do with the gas prices being forced on the community, or does he agree that that is part of Government policy?

Mr. Hamilton

The pricing policy was to bring gas to a more economic cost. No one believes that the gas industry is efficient. Had it been more efficient, the 10 per cent. increase would have been on a much lower base. It has enormous areas that could be more efficient, but we shall be lucky if we see greater efficiency. The industry is under no pressure to become more efficient. It has bought its gas enormously cheaply and has a captive market. Even with the collapse of oil prices—oil is its basic competitor—the price of oil remains much higher. The gas industry is on the pig's back. I see no pressure on the British Gas Corporation to become more efficient. But there will come a day soon when it will have competition and the game will change.

If the Chancellor continues his cautious policy on Government borrowing, interest rates will come down further. We cannot be too complacent. They are affected by other economies. We have the problem of the effect of the American economy. But I should like to see the Chancellor take the strain of interest rates on the exchange rate and be prepared to see the pound weaken slightly on the foreign exchanges. He should generally keep our interest rates down, which is essential in making sure that industry starts to expand again.

What are the consequences of such policies for unemployment? I believe that unemployment will peak in the middle of the year. First, economic activity improves, and there is always a time lag before it comes through to the unemployment figures. I believe that unemployment will peak at 3 million to 3¼ million this year, and slowly start to fall.

I do not believe that the fall will be dramatic, but in November to January unemployment increased by only 4.3 per cent. Let us compare that with our Western partners. In Austria in the same period unemployment increased by 19 per cent., in Sweden, by 18.4 per cent., in West Germany—where we are told they have the situation taped and do not have the same problems that we have—by 17.3 per cent. and in the United States, by 15 per cent. There is evidence that we are reaching the peak of our unemployment problems, while many of our partners in the Western world are just beginning to face the problem, and are some way behind us.

Once the upturn comes, the South-East will be the first area of the country to benefit. We shall see a growth of new small businesses. Here, we must pay a great tribute to the number of measures that the Government have taken to improve the lot of small businesses. My hon. Friend the Under-Secretary of State for Industry has done great things to make life better for small businesses to start up This will be the area of expansion in the economy, particularly in the South-East. We shall see this expansion come, not so much in manufacturing as in the service industries Tourism and leisure have also been mentioned this morning as areas where we might well see things picking up.

There is no doubt in my mind that the large manufacturing companies may turn out considerably more wares without employing another man, but I do not believe that that is true of the small businesses, particularly those in the service sector. Labour is a critical component in their performance. Therefore, the second their business starts to expand, they have to employ more people. At that time, we shall find that there is a shortage of skilled workers and we might well find ourselves back with the problems that the South-East suffered two or three years ago.

In those circumstances, the answer in any reasonably mobile and sensibly organised society is to move men from areas of high unemployment to areas where the jobs are. In that way skilled vacancies can be filled by people who might otherwise be in dole queues in Newcastle or Liverpool. However, we do not have that degree of mobility. We have rigidity. The housing sector probably illustrates the worst example of the rigidities we suffer from. The concentrated and remorseless efforts of the Labour Party have virtually squeezed out of existence the private rented sector in housing. It was the private rented housing sector that provided people with the opportunity to move from one part of the country to another. Rent Acts and security for existing tenants have resulted in landlords taking advantage of vacant possession to sell the building rather than re-let it. There is no doubt that in the old days when people wanted to move from one part of the country to the other they could look for rented accommodation if they were not able to buy themselves a house. That enabled people to come from regions of high unemployment to the South-East, where they could rent accommodation for themselves and their families. It is now virtually impossible to find rented accommodation for anyone other than a single person in this area. That is an absolute tragedy for which the Labour Party will have to answer in the future. If people live in council houses in areas of high unemployment, they find that few people want to move from the South-East to the North-East and North-West. The result is that it is quite impossible for them to move.

I do not blame only the Labour Party for the rigidities of our system. The City of London has something to answer for in that Britain does not have transferability of pensions. That is another thing that discourages people from moving from one job to another. It is another rigidity that we have in our labour market that we could well do without. When people leave companies they get their contributions back from the company pension scheme, but they do not get any bonus or profits and they are not able to continue with a funded pension. That suits the pension companies because it means that the more people who leave the scheme the more money they have to fund the people still in the scheme. It is therefore convenient for the pension company to have a large number of people leaving its scheme. In terms of mobility, labour and equity it is a monstrosity that so much money is taken away from people in that way.

Even with the improvement in the economy, long-term unemployment will remain much higher. Here, I take issue with my right hon. Friend the Secretary of State for Employment. I do not think that we shall come down to a figure of around 1 million unemployed in the future. Levels of unemployment now are at much higher levels and that is something we shall have to think about closely. One of the best things that we could possibly do would be to move on to a tax credit scheme. People have talked about it, but when it comes to action the Treasury and the Inland Revenue say that it is virtually impossible. There are a number of people who will always prefer to work even though the amount of money they earn is similar to what they receive on the dole. In those circumstances, it would be a good idea to top up social security benefits for those at work. That is something we should not shirk any longer. It will not be easy to bring in a tax credit scheme but that does not mean that it is not desirable. In addition, it would probably save on public expenditure as well, because the whole onus for the administration of the social security benefits scheme would be put on to employers and could be taken away from the Civil Service. That must be a good idea.

We must accept that we still have to live with unemployment. I hope that the stigma of unemployment will drift away. It is terrible that people feel desperately guilty about being unemployed. It is a post-war development. Before the wars, in the days when the middle classes had capital and did not see it being eroded by inflation within a few years, many people retired from the Army at the age of 45 and made a useful contribution to the life in their community. They did not feel that not having a job was in any way reprehensible.

As I have already suggested, we must look at the question of the shorter working week. It must be sensible to share out work. We must make sure that we substitute imports with our own manufactures. We must look for higher productivity and restore the operation of the market place, both in labour and in the supply of goods. That is the only way that we shall have an economy that reacts quickly enough to changes that are now becoming faster and faster and to the opportunities that arise. What the Government can do to stimulate growth or anything else is limited. Growth will come naturally from the bottom rather than be imposed from the top. We must do everything that we can to free the system so that we get a reaction.

I must apologise, Mr. Deputy Speaker, because I now have to leave for a speaking engagement in Kent. Therefore, I shall not be here to hear my hon. Friend the Under-Secretary of State for Industry but my thoughts will be with him.

11.7 am

Mr. John Wells (Maidstone)

In seeking to solve the problem of unemployment in the South-East and everywhere else, there are four major factors involved—the action of national and local government, of the quangos, and of individual employers.

The greatest contribution that the Government can make to creating real new jobs is reducing interest rates or assisting the reduction of interest rates. I am glad that my hon. Friend the Member for Epsom and Ewell (Mr. Hamilton) touched on that. However, I do not think that it is wise for the Government to go out into the market to create bogus jobs. With the greatest respect to my right hon. Friend the Secretary of State for Northern Ireland—or perhaps it was his Labour predecessor—Northern Ireland got into an awful mess over De Lorean. That should be a lesson to us. If the Government interfere with the market forces by bringing in people and injecting capital and ideas, thousands, and occasionally tens of thousands of jobs are falsely planted in an area of high unemployment. Then a decision is taken across the Atlantic, or in some other part of the world such as Switzerland, and suddenly the jobs that have been created falsely by Government vanish overnight.

Mr. Prescott

Not like Laker.

Mr. Wells

I shall come to Laker in a minute.

I congratulate the Under-Secretary of State for Industry, who is present today, on the great contribution that he has made in assisting smaller businesses. Such assistance must be genuine, and I believe that my hon. Friend has done a great deal to help. The quango called CoSIRA—the Council for Small Industries in Rural Areas—has also done very well in some parts of the country, but it is essential that local government should play its proper part.

We in Kent enjoy—I suppose one can say "enjoy"—a Conservative county council. It talks a great deal, it huffs and it puffs, but the first thing that local government can do to make new jobs and to encourage investment is to get the rates down. In order to get the rates down, it has to look at its foolish expenditure—or potentially foolish expenditure—and pare it as closely as possible.

I do not believe that the Kent county council has pared its foolish expenditure as closely as it should. I shall give two or three examples, which come largely under the heading of roads, but first I want to make it abundantly clear that the county surveyor, Mr. Allen Smith, is at the height of his profession, is one of the finest county surveyors in the country, and is a highly respected man. He is even respected by me, and I do not respect many people. I make no personal attack whatever on Mr. Allen Smith, but I want to give three separate examples of the crass folly of our county council. I am glad to see an ex-county councillor—my hon. Friend the Member for Gravesend (Mr. Brinton)—on the Conservative Benches.

The county council has created three particular roundabouts. One of them is still being built. The first great monument to the council's folly was when it made an "underpass-mit-roundabout" to enable the county council employees in Springfield to get in and out of their place of employment more quickly at the beginning and end of the working day—roundabouts for the boys.

The second example is the council's deplorable use—or lack of use—of West Malling airfield. It built another roundabout there to let the boys and girls get to and from work a minute or two quicker.

Mr. Prescott

Who did that?

Mr. Wells

The Conservative county council. I am not attacking the councillors as Tories but as ostriches. [Interruption.] If Tweedledum and Tweedledee—the hon. Members for Kingston upon Hull, East (Mr. Prescott) and Stalybridge and Hyde (Mr. Pendry)—on the Opposition Front Bench will contain themselves for a minute or two they will no doubt get their chance to speak.

Mr. Prescott

But it was still the surveyor.

Mr. Wells

No, it was not the surveyor. He was told to do the job and he did it. He was given his orders, and within the parameters of what he had to do, the gentleman did a very good job.

Mr. Brinton

Will my hon. Friend give way?

Mr. Wells

I have already reminded the House that my hon. Friend is here. As you are yourself a South-Easterner, Mr. Deputy Speaker, with reasonable luck you will get your eye caught. Also, I want to be brief, so that my hon. Friend can speak to us at length.

I was dealing with the roundabout at Mailing airfield. I do not know what it cost—probably something over £100,000. It does no good except to get the boys and girls to their place of work without any queue or hassle whatever. Even we, in this great seat of government, have a hassle when we get out at 3 am. The police do their best to help us but we have to queue for a bit. Why the people on the Kent county council payroll should not have to queue for a moment or two I do not know.

The council's latest effort is at Town Hill in West Mailing, at the junction of the A20, where a mammoth sort of sub-spaghetti junction is being built. For whose benefit? It is for the benefit of those same county council employees, going to and from work. If only the council had had the nous to get on with the building of the West Mailing bypass a bit quicker, that would have been of real benefit.

Due to the grandeur of the council's former leader, his desire for personal fame and greater honours—he has now been translated to some garden centre in Liverpool—and his desire to have a personal monument, we may now have a new flying venture at West Mailing. If the county council had set up an industrial estate and built some houses on the airfield, that would have created more jobs and more real opportunities for work.

We hear a great deal of the myth that private flying is good for business, but 90 per cent. of company aircraft are maintained for the dirty weekends of the managing directors. This is a simple fact. We know that many chairmen who have company aircraft have little friends, and the business need for private flying is a bogus argument that is trotted out by various company chairman and their assistants.

The great companies that really need private flying arrangements could be counted on the fingers of two hands. In my area there is one such company, and it has very satisfactory flying arrangements. Even if it did not, it would be most irrational to misuse the Mailing airfield for the benefit of one aeroplane belonging to one company.

While on the subject of my undelectable county council, I recall that we have had a public inquiry into the Malling airfield, and a clear undertaking was given by the chief executive of the county council that there would be no flying, whatever the present planning position might be. It was stated that there would be no fresh flying in the area until the finding of the inquiry was made known. Yet the county council has given Television South the permission to fly an aeroplane in and out twice a day. is that honourable? The council gave its word to the inspector and has now broken it.

I return to the benefit that national Government can give to the South-East. I began by stressing the need to reduce interest rates. In order to reduce interest rates. it is essential—as my hon. Friend the Member for Epsom and Ewell said—that Government keep a very close eye on their own public borrowing and their own expenditure . Therefore, it is essential that they take a fairly jaundiced view of any wild or extravagant schemes. Unfortunately, it is necessary that they should from time to time defer schemes that most sensible people would think are fair and sound.

It is in that unhappy category that the deferment of the construction of the M20 missing link between Hollingbourne and Charing has taken place. I am very sorry that that link has not been built. It traverses my constituency and I have been under considerable attack for not being more vigorous in demanding its immediate construction.

My hon. Friend the Member for Faversham (Mr. Moate), in his wise speech in moving the motion this morning, emphasised the need for quick and short-term benefit in order to get the economy moving again and to get short-term jobs as quickly as possible. If digging were to start this afternoon, the construction of the M20 link would make very little difference in that respect.

It is my belief that the Government would be far wiser if they looked at other road projects where there can be some quick benefit. Recently, my borough council has been telling me that it is desperate that the link section should be built. In my view, it is barking up the wrong tree. The roads that we want built to benefit Maidstone and north Kent are those coming into London. Anyone travelling up the M20 and the A20 gets nearer to London and has to come off the motorway and go on to a bypass at Swanley. Coming off the Swanley bypass, he leaves a six-lane route and comes on to a three-lane route. Then he comes nearer to London and encounters a major bottleneck which builds up every day of the week.

That road has a daily throughput of 43,000 vehicles in the area of Ruxley corner. That is a very large number.

The injury-accident figure, by which I do not mean the number of people injured, because there are sometimes two or more people per car, has been 225 in the past three years on that comparatively short stretch of road.

If we really want to improve the infrastructure in Kent to help people and to improve the commercial viability of the area, let us get on quickly with that section of the A20. That would be a real benefit where the national Government could make a quick contribution.

A second area where the Government could make a quick contribution to our well-being and about which I hope perhaps that my hon. Friend will write to me, because I do not expect an answer today, concerns the paper industry. My hon. Friend the Member for Faversham laid great emphasis on the importance to our area of the paper industry. We are suffering from quite clear unfair dumping of Government-subsidised tissues coming in from Spain. Despite my fondness for Spain—and I declare a sort of interest, as chairman of the Anglo-Spanish group in the House—it is essential that the dumping of Spanish tissue be looked at by the Government with a pretty sharp eye.

My hon. Friends who represent the dockyard areas have made a gallant stand to defend their dockyards. No one is more appreciative of that than I am. But I must tell them that, during the last war, I had the privilege of being a submarine officer and of standing by a submarine that refitted in a Kentish dockyard. As it happens, it was not Chatham but Sheerness. At the height of the recent war, it was the considered opinion of the sailors in the Royal Navy who were standing by that boat being refitted that the dockyard mateys were slow, idle and overpaid.

Sir Frederick Burden

Is my hon. Friend surprised to learn that some years ago a naval officer, who retired as an admiral and who was a VC submariner during the war, once said to me "Thank God we had the submarine builders at Chatham, because they saved my life and earned my VC"?

Mr. Wells

Of course good work was done; I am not saying otherwise.

Sir Frederick Burden

It was Admiral Myers.

Mr. Wells

A very distinguished officer. I am not saying that good work was not done. However, every successive Government since the war have desired to close Chatham dockyard and, until our present Prime Minister and her Government, none of them have had the guts to do it.

The need is not to yearn for the past but to look ahead to the future. It is essential that the Government give every assistance to new businesses and not only to the aspect of tourism about which we have heard, to go into the dockyard area. I urge the Government to make the dockyard buildings available for new ventures.

In this connection, I touch on a difficult area. I believe that the attitudes of planning and the attitudes of the conservationists frequently are extremely hampering in the provision of new jobs. Recently, we had a deplorable meeting in one of our Committee Rooms of hon. Members representing Kent constituencies and Kent local authority representatives to discuss the problems of unemployment in Kent. All that the local authority representatives could do was wring their hands and say that unemployment was very bad in Kent. One or two constructive suggestions came out of the meeting, one of them from a local authority representative from somewhere down in East Kent—I think, from Dover. He said that local authorities were very foolish and hidebound in their attitude to planning permissions.

My own borough council, which is normally rather wise as local authorities go and normally fairly sensible, caused the owners of a brand-new hotel to fill in the swimming pool that they had dug because it contravened some tuppeny-ha'penny planning convention. If we really want to go ahead and boost tourism, we do not want hotels to be made to fill in their newly dug swimming pools. Local authorities ought to take a new look at their planning practices.

I reiterate what I look for from local authorities. They must keep their rates as low as they can. They must do all that they can to make their planning committees more tolerant, more understanding and more sympathetic to the needs of the times in which we live. Local education authorities, whether the Kent county council or any other education authority in the area, should ensure that their technical education is the technical education that is needed for the future and that the courses offered are not in knitting and jam making but in the real modern technology of the future.

Kent is one of the leading areas in the horticulture industry, and I am proud that, off its own bat, the industry has sponsored the National Institute for Fresh Produce, which is a trading body designed to improve educational standards in our industry. It is entirely self-sponsored. My hon. Friend the Member for Faversham spoke about the number of self-help training schemes in his area. The Government and local authorities must give a fair wind to those self-help measures.

It is essential that, from the South-East, we say to the Government that there should be no extension of assisted area status of any sort elsewhere. It needs only the creation of assisted area status in one area to generate suffering in an adjacent area. There is a knock-on effect. We believe that we can go it alone if we get just a little help.

We also wish the Department of Transport to have a more rational and helpful attitude about motorway signs. It should be possible for motorways to have signs saying "Visit Leeds castle", which is not exactly advertising. One does not wish the motorways to be cluttered with coarse and undesirable advertising, but within certain limits greater flexibility should be possible.

I am a constant critic of the Southern water authority, that most unloved of bodies, but today, out of character, I wish to pay it a small tribute for its attempt to improve the leisure and touristic scene in our area. Its fisheries division, which deals with the amenity waterways, is doing as good a job as any quango can. It is currently promoting a Bill that has just gone to another place to alter the Medway regulations, which has caused great anxiety to some of my constituents and great happiness to others. It is a difficult measure, but it is essential that central Government should tell the quangos to help tourism.

We talk a great deal about tourism. What do we mean? Do we mean British people coming down from London to go hop-picking or to spend a weekend or are we talking about Continental tourists? If we are to build up the tourist industry in Kent, we must have an early decision and start on the construction of the Channel tunnel. That is a great project that will undoubtedly create short-term jobs quickly and long-term jobs for a long time to come. I know that the hon. Member for Kingston upon Hull, East, who is on the Opposition Front Bench, has been a stern critic of the Channel tunnel project from time to time, but I hope that we may carry him with us. There is scope for both a modest tunnel and the shipping interests to which he is so devoted. The Channel tunnel can only do good in Kent. It has been debated time and again and I hope that we shall now have a quick decision and, thereafter, quick action.

My hon. Friend the Member for Epsom and Ewell talked about the black economy. Kent is a great horticulture area. We have massive fruit interests and there is great use of seasonal labour in the fields. The period stretches from almost as early in the year as now through to just before Christmas. There is scope for much part-time employment and, truthfully, in central Kent during the summer and autumn months no one need be unemployed. Tweedledum and Tweedledee on the Opposition Front Bench made many rude noises from a sedentary position when my hon. Friend the Member for Epsom and Ewell spoke about the unfilled vacancies for meter attendants. The fact remains that vacancies are available and there is no unemployment in part-time jobs in some parts of the South-East.

It is essential that those part-time jobs should be considered honourable. The awful phrase "the black economy" implies that there is something crooked or dishonest in part-time work. Of course some people are fiddling their social security payments, which is deplorable and dishonest. However, the Government must begin to consider ways of making part-time employment—which now comes under the heading "black economy" with its unpleasant connotation—honourable and not something to be sneered at. It is also essential that people who fiddle their social security payments should be prosecuted more rigorously, because it is distasteful to those who work hard for a small income, especially in the agriculture industry, to find people living in an adjacent house who are cheating on their benefits and receiving more than the honourable worker.

It is essential that the Government provide some real statistics about the changing pattern of women in work. Unemployment figures in our area are rising at about the rate of the number of women beginning work each year. I do not say that women should not work. If they wish to work, they should, but it is important that the yearly figures should be taken on a comparable basis.

I have already mentioned the good work that my hon. Friend the Under-Secretary of State has done to assist small businesses. However, the smaller businesses should be helped on an even greater scale than at present. If 10 small businesses start up and five of them go bust but five remain in business, at least five have gone on. Again, Tweedledum and Tweedledee on the Opposition Front Bench started to shout "bankruptcy" at my hon. Friend the Member for Epsom and Ewell. They said that there were more bankruptcies than ever before. I see no harm in five bankruptcies if there are five successes. The opportunity for the small business to start up and to build up is attractive. I hope that my hon. Friend the Under-Secretary of State will pay attention to that matter.

11.37 am
Sir Frederick Burden (Gillingham)

It is a most extraordinary coincidence that my hon. Friend the Member for Faversham (Mr. Moate) is successful in the ballot the week after I—his near neighbour—for the first time after 32 years as a Member of Parliament was successful in the ballot and introduced a motion on defence. In that debate I pointed out the problem, not only in my constituency but in my hon. Friend's, which is adjacent to mine. I hope that the Government will take note of the fact that the Lord may move in a mysterious way but, by one means or another, He has ensured that we are successful in the ballot so that we can bring to the attention of the Government, the House and Britain the unemployment problems in our constituencies and in the South-East.

Unfortunately, there are problems not only in our area but in the whole country. The hon. Member for Kingston upon Hull, East (Mr. Prescott), who no doubt will intervene in the debate, asked "What about five bankruptcies if 10 new businesses start up?" It is easy for Labour Members to take that attitude. I wonder how they would avoid bankruptcies occurring.

Mr. Prescott

First, I did not ask the question which the hon. Gentleman has attributed to me. Secondly, think that the hon. Member for Maidstone (Mr. Wells) talked about five bankruptcies being replaced by five new companies. Bankruptcies are being caused by high interest rates, which arise directly from the Government's economic policy.

Sir Frederick Burden

That is not what my hon. Friend the Member for Maidstone (Mr. Wells) said. My hon. Friend stated that if there were 10 new firms and five of them went bankrupt that would be inevitable. The hon. Gentleman talks about high interest rates causing bankruptcies for small businesses. However, the Labour Party is talking about raising another £9 billion and ploughing it into the economy. The only way in which a Labour Government could raise that sum would be to pay interest rates that would attract it. The Labour Party should think these things out rather more carefully. It is no good the hon. Member for Kingston upon Hull, East frowning. His party must give attention to these matters. It is so easy to talk about raising another £9 billion. I remember vividly the last Labour Government reaching a position when they were unable to borrow any more money at home or abroad. They had to call in the International Monetary Fund. The Opposition are now making comments that are symptomatic of the crisis that caused them to go to the IMF.

I am grateful to be able once more to impress upon the House, and I hope upon the Government, the fact that as a direct result of Government action 7,000 jobs will be lost in my constituency at the Chatham dockyard. On all the evidence that is available to me—there has been a great deal—it will be impossible for the Government to ensure that, if the dockyard goes, the SSN submarines, which the Minister of State for the Armed Forces has admitted are the most potent weapons of defence, will be able to be refitted and kept sufficiently on station if they are refitted only at Devonport, which so far has not refitted one SSN whereas Chatham has refitted seven.

Despite what my hon. Friend the Member for Maidstone said about the dockyard matey, thank God we had the dockyards and their mateys during the war to repair and return to sea the ships that enabled us at least to keep Britain's food supplies, munition supplies and troops going to and from this country. We should pay them a tribute and not denigrate them.

In addition to the job loss at Chatham there will be about 2,000 job losses on the Isle of Grain, to which no doubt my hon. Friend the Member for Gravesend (Mr. Brinton) will refer. There will be another 600 jobs losses at Wingett. Jobs will be lost in a small area. About 9,600 jobs will be lost and there will be a knock on-effect.

Unemployment in the area is now about 12 per cent. If the dockyard closes—I say "if" because the closure must be fought to the last moment—there will be about 23 per cent. unemployment. That will be intolerable. That will mean about 7,000 jobs losses as a direct result of Government action, which will be a disaster. I remember my right hon. Friend the Secretary of State for Scotland announcing that 890 jobs were to be lost at Invergordon as a result of the closure of the aluminium smelting plant. He described the closure as a disaster for the area. The closure of Chatham will cause about 7,000 jobs to be lost in my constituency alone. When the other losses are taken into the account the total will increase to 9,600. In addition, there will be the knock-on effect. This will be an even greater disaster for the area that I have represented for so long than the one that occurred at Invergordon.

We cannot expect more than 1,000 of the Chatham dockyard workers to be transferred to Devonport or Rosyth. It is easy to talk about transfers, but most of the men who are employed in the dockyard and who are eligible to transfer, and wish to do so, have bought their homes. They thought that they would have absolute security as they were working for a Government Department within the Chatham dockyard. They will have difficulties. There will be problems in housing them in Devonport and Rosyth. Are there sufficient houses available in both areas to accommodate the extra workers? Will those who leave my area, in which they have bought their homes on mortgage, be able to sell their houses? In practically every street in my constituency there are "for sale" boards. Will my constituents be able to get bridging loans to enable them to buy houses, as they will have to do if they go to Devonport or Rosyth? I very much doubt it.

During the debate on defence that took place on 15 February, which was initiated on my motion, the Minister asked the right hon. Member for Deptford (Mr. Silkin), the Opposition spokesman on defence, whether a Labour Government would keep Chatham dockyard open. The right hon. Gentleman replied that if the Opposition became the Government they would do so "tomorrow". That "tomorrow" has gone, so we know that a Labour Government would not do anything about it. Therefore, it is up to the Government and to Conservative Members to try to do something about it.

Recently the Opposition have made much about pouring vast sums into the construction of roads and council houses. Not every unemployed person is capable of working on the roads or of building council houses. There are many highly qualified people in other spheres who would be unable to do anything in that direction. In any event, there must come a time when the building of roads or council houses on any great scale must slow down. At that stage the immediate employment that has been taken up will disappear or slow down in the road and housing construction industries.

What is the way ahead? It is for industry to be competitive in the market places of the world. That means manufactured goods that can be sold, not roads or council flats, but goods that the world wants. There has been, and is continuing, a world-wide advance in technology. In the meantime, since the war, we have lost more and more countries the economies of which we could control so as to ensure that British goods had preference there. We are now in the market place in practically every country in the world with the products of other countries.

It is true that we are stopping overmanning. I welcome that. Through such a policy industries are becoming more competitive. That is essential, However, in doing that we are creating more unemployment. No matter what Opposition Members say, that is inevitable.

We have been through a period of intensive mechanisation. Countries such as Japan, from which we had no competition before the war, have now mechanised. We have mechanised. We now have the microchip. We are moving into the era of the robot. All that means less need for labour in industry and its replacement by machinery. Therefore, let us not talk about easily restoring anything like full employment. I beg the Labour Party and my party not to try to delude people into believing that, by a stroke of the pen, a Government can ensure full employment.

That is not only a problem of our country, but a worldwide problem that is becoming more and more evident. The only way of restoring a greater number of people to employment in this country and abroad is by accepting the facts of life. The facts of life are that more and more countries are becoming more and more industrially efficient. High technology is continually advancing. Therefore, we must look to a period of much earlier retirement and shorter working hours. That is absolutely essential.

However, for us in this country to take that course alone would not help our employment. It would mean that far more people would be unemployed because we would not be able to compete with other countries that were working longer hours, using the same type of technology and not having their efforts abused—I use that word deliberately—by trade unionism being exploited and union members not accepting that we must be competitive.

I hope that it will be realised that it is not just a problem for our country, but a problem for the whole industrial world. In many ways I have great faith in, and confidence and admiration for, our Prime Minister. I shall fight to the last ditch over what I believe to be wrong in the closing of Chatham dockyard. However, we are a member of the EEC, which is a considerable industrial unit with greater muscle than any trade union or any company.

I should like to see our Prime Minister go to Brussels and make it perfectly clear beyond doubt that this is a world problem. Because of the power of the industrial units in the Common Market and because of the size of the market itself, she could broach to the members of the Common Market the idea of leading the world and she could even go so far as to say that because of the world situation, we in the Common Market must and will demand that there shall be an agreement between industrialised nations whereby there is earlier retirement and shorter working weeks.

If industrial countries refuse to come in with us on that idea, we shall have to think about putting up barriers against their trade so that we can start to operate that system in the Common Market. That is the first possible and probable step towards bringing down the tremendously high rate of unemployment that I believe will not lessen but will probably increase over the years because of high technology.

The Opposition aim at pulling out of the Common Market. They aim at isolation through Britain pulling out of an area in which we could create great influence. That would not help unemployment but would ensure that it increased tremendously.

I take off my hat to my hon. Friend the Minister because I know that he believes in small companies. However, I say again: please let us not delude ourselves in the world of manufacturing today that there is too big a place for small companies. Some small companies will grow. Some small companies, because of the drive, efficiency and high technical knowledge of the men running them will thrive and employ many people. However, we must not believe that that will solve the unemployment problem.

My hon. Friend may completely disagree with the proposals that I have made. However, I hope that somehow he will be able to draw the attention of the Prime Minister to the possibility of taking an initiative that will help unemployment, not only in this country, but in the world.

11.59 am
Mr. David Crouch (Canterbury)

I cancelled an engagement in my constituency to speak here today, should I be lucky enough to catch your eye, Mr. Deputy Speaker. My engagement was to speak at the Geoffrey Chaucer school in Canterbury. The subject was unemployment in Kent. I hope to speak to the school on that subject at a later date, but I cancelled the engagement today because I believed that it was important to speak on it in the House today because it is such a major problem.

I wished to raise the question of unemployment in Kent and the South-East two and a half weeks ago, but the motion was not reached. I therefore congratulate my hon. Friend the Member for Faversham (Mr. Moate) who, as he has said, lifted some of the words out of my motion to use today and has seized this opportunity to draw to the attention of the Government, the Opposition and people outside the fact that, in the midst of the general recession and unemployment problems in this country, there is a major problem in Kent.

The problem of unemployment in Kent is not new. There have always been pockets of severe unemployment in Kent at times of recession. We have always had our black spots. Today those black spots have unemployment problems every bit as serious as those in the worst-hit parts of Britain in the assisted areas and even in the special development areas, but we receive no help because we are in the "prosperous South-East". We are bypassed because we seem so prosperous since we are in what was once thought of as the "golden triangle" between London and the Continent.

Kent is suffering major structural unemployment which, quite apart from the recession, is due to the decline of traditional local industries. There is no better example than that mentioned by my hon. Friend the Member for Gillingham (Sir F. Burden), the current decline of the Chatham dockyard. Its closure will cause 7,000 people to be unemployed. That figure is not included in the figures that I shall give. It will be in addition to the existing black spot in the north-east part of Kent and on the north-east coast of the county.

If action is not taken to halt ,this structural decline, unemployment in some areas will rise to more than 22 per cent., certainly in the Medway towns. I shall now surprise the House by telling it that unemployment is already 22½ per cent. in the coastal area of Whitstable and Herne Bay, in my constituency.

How can I face the school children whom I was to address today? When they ask me to talk about "unemployment", they really want me to talk about job opportunities. What can I tell them when unemployment around their homes is already 22½ per cent.? That is far higher than in almost all of the assisted areas and special development areas which receive generous Government help. I have to tell those children that for us there is no such special help because we are in what is thought to be a prosperous area of Britain.

I maintain in the strongest terms that we cannot sit back and watch Kent's industry and commerce decline in this way. Unemployment in Kent has risen from 25,000 in 1979 to more than 60,000 today. The national average for unemployment is 12 per cent. In Kent overall, the figure is approaching that, at 11.6 per cent. Reference has already been made to those figures. But there are eight areas in Kent where unemployment is above the national average, and in those areas it is as bad as in the assisted areas. Unemployment there ranges from 13 per cent. to 22 per cent. Something must be done.

Chatham dockyard is to close. As has been said already, that is indeed a disaster, and it is a tragic and grim decision that has produced it. I am not sure even now that it is right from the defence point of view, but that is another matter. Certainly it is fearful from the point of view of unemployment.

In addition, a further 5,000 jobs are to go. Between 1,200 and 1,600 jobs, I believe, will be lost at the BP refinery in the Isle of Grain, and in Gravesend, Strood, Northfleet and Rochester industry is declining and unemployment is rising. There is little industry left in Kent to which young people today can look for jobs. As my hon. Friend the Member for Ashford (Mr. Speed) has said, in Ashford, which was known as one of the growth points for industry in Kent, a further 800 jobs will be lost—again, they are not yet included in the overall figures—with the closure of British Rail's engineering works there.

Kent is the area of England which leads to Europe. We are in line with the prosperous area of Europe and the prosperity which could lie ahead if we make a success of our participation in Europe. But Kent is no longer representative of the rich South-East. The outgoing tourists do not stop. They press on to Dover on their way to the sun, while the incoming tourists press on to London. Only 4 per cent. of them stop in Kent, so we obtain no benefit. Moreover, as my hon. Friend the Member for Faversham properly mentioned, the fact that our roads are among the worst in England—I do not mince my words here—is yet another example of how successive Governments of both parties have neglected Kent's. motorway system. Even today, the motorway from London to Paris stops 25 miles short of Dover—so much for Whitehall planning!

As long ago as 1970, I told the then Under-Secretary of State responsible for roads in the new Conservative Administration that we must have a motorway for Kent. That Minister, then in his first appointment, is now Secretary of State for the Environment. I argued the case for the importance of that motorway because Britain was to be linked to the Continent by entry into the Common Market. That was the policy of the new Conservative Government in June 1970. The Minister listened patiently, as Ministers always do when Members put constituency cases. He then turned to his officials and asked what they thought. The answer was not "Yes, Minister", but "No, Minister", because the main traffic from London went not to Dover but to Margate. That was why the road did not run from Brenley Corner to Dover and why they could not give it priority. How did the Minister react? He did not accept that. He overruled his Sir Humphrey, and I was very glad that he did. Although he was not able to turn that road into a motorway, at least it is now a trunk road and bypasses have been built, so the road to Dover is much better than it was or than it would have been but for his intervention.

The Government are doing a great deal to help those areas of Britain which are in difficulties. The Government's policy has restricted the area in which selective assistance can be given. I agree that help should be concentrated where it is really necessary. The incentives for industry today in the assisted areas are excellent, as are the new youth training schemes. The 74 aids to small businesses which the Minister played such a part in bringing forward and putting into action are also excellent. They can help small businesses to grow, invest and expand. The Government believe in giving help where it is really needed and can show a dividend. My message is simply that Kent really needs help, and I am certain that it can show a dividend. I do not want to press the showing of a dividend too hard because I might defeat my argument. However, it cannot be done without some selective help.

I do not agree with my hon. Friend the Member for Maidstone (Mr. Wells), who said that it was because of the inactivity or incompetence of local authorities, particularly the county council, that we were not helping ourselves. When my hon. Friend speaks about the county council, he sometimes reminds me of Mark Antony without the frills and diplomacy, and certainly without the praise. We were, of course, amused by his remarks, but local government cannot do it on its own. Local government can do much, but we must ensure that local authorities, at district and county level in Kent and the South-East—I am trying to think of a less indelicate phrase than that which leaps to mind—work very hard towards that aim. They should not allow any cobwebs to develop on the problem of stimulating people to consider the area, produce nursery and industrial development sites, produce the land and facilitate the plan. They should encourage it to happen and not stand in the way with bureaucratic inaction, as so often happens. At local level—county and district—they must do everything possible to make new employers welcome.

However, investment must be attracted into Kent. We need new investment and industries to replace the old industries. If the Chatham naval dockyard must go, we have to produce something new.

The Government have a part to play. They must demonstrate that they are not overlooking Kent and other such areas in the South-East. They must demonstrate that they are willing to help anyone who wishes to come to Kent and that the area will not be overlooked. Kent has much to offer—first-class labour, and technical and scientific services—and educational standards are very high. We have all the facilities needed as a back-up for encouraging further investment. We are on the road to Europe; the Channel tunnel will almost certainly be built and we will, therefore, be very close to Europe.

Therefore, we are not only right to ask for full-scale special development; we also need to be helped over this temporary difficulty. Kent is the ideal site for new industrial and service industry development.

We could attract investment to Kent if people outside it were encouraged to think of the area and were not automatically attracted to development areas in South Wales, for example. We should attract investment from Europe. We shall be closely connected with France and Germany and there is no lack of interest from those countries to invest in Britain today. We can also attract investment from the United States because there is no lack of interest in Britain among the Americans. They would be attracted to Kent because of its proximity to Europe and, for that reason, the area is doubly interesting.

Sir Frederick Burden

Would not my hon. Friend agree that one of the greatest encouragements which could be given to overseas companies to invest in Britain would be if labour relations improved and the strike element in factories was reduced?

Mr. Crouch

I am sure that my hon. Friend is right. In the past two years, the number of strikes has decreased in a remarkably healthy-looking fashion. Under the present Government, industrial relations are in a much healthier state, no matter what the preachers of gloom and doom may say. That is also the view of trade unionists and union leaders.

We must attempt to attract overseas investment into a part of England which prospective investors may not have hitherto thought of as favourable. The Italians make fridges, deep freezers and washing machines. Let them come to Kent, which in travel terms is rather nearer to Italy than is South Wales. Let us send a delegation to the EEC countries to tell them that Kent exists and that it is near.

The microchip computer industry is represented in Rochester and, in a small way, in my constituency. An industrial estate situated between Herne Bay and Whitstable contained a thriving textile industry which declined and then closed. It is very sad that an American company, making a top-class fur fabric product declined and finished last December. That put 200 to 400 people out of work. However, the company has another wing in the computer business which makes connector parts for computers which has continually expanded over the last 15 years and is still expanding.

Another company, on a separate and small industrial estate in my constituency, has embarked on a £1 million expansion which will mean employment for another 30 people. It also makes parts for the exciting computer industry. There is still hope, but more successful companies need to realise that they can be successful in Kent and that there are good back-up resources.

I know that you, Mr. Deputy Speaker, live not far from Kent and are aware that it is still a good place to live in because of the countryside, old towns, historical places such as the town of Canterbury, amusements, theatres, and a great regional opera, of which we are justly proud. The Kent opera produces magnificent performances in Kent and also travels abroad to Italy, of all places, where it is highly acclaimed. Kent also has the seaside and a great coastline. The world water ski championships are held on the Whitstable coastline.

Those are all leisure aspects, and we are neglecting to take the necessary action to bring them out of the nineteenth century and into the twentieth and twenty-first centuries. Perhaps we do not have as much sunshine on the "Costa del Kent" as there is on the Costa del Sol, but we are still near a great centre of population in London and others elsewhere for the weekend tourists. I should like to see a much greater development in tourism which may not need Government aid because we might attract private investment.

We must consider one of the fastest growing and greatest developments in sport—yachting and boating. I should like to see the development of a marina or marinas on a big scale on the north-east Kent coastline. I was surprised some years ago, in the days of the great yachts, to discover it was not only at Cowes that the championships were held in the midsummer months. In the early summer months great yachts, including that of the late King Edward VII, used to sail from Victory Point at Sheerness. It was easier to reach than Cowes. The same could happen again. There is a need to encourage, if not the great boats, the many owners of small boats to discover for themselves how good are the waters of the Thames estuary for sailing.

I have mentioned already the need for improved roads. For travelling from east to west in Kent, conditions are not bad. But the roads running north to south across Kent are not so good as they were in Roman times. Tourism is still viable, but I wish to see it brought into the new age. My hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies) has mentioned that it is not possible for assistance to be given to our large and somewhat declining tourist towns because they are not located in an assisted area. On the other hand, Scarborough and Newquay can attract £1 million because both are located in assisted areas. Margate, Herne Bay, Whitstable, Ramsgate, Broadstairs and Deal do not get a penny.

Mr. Rees-Davies

My hon. Friend makes a valuable point. The chief executive of Scarborough told a resorts seminar last Friday that Scarborough had managed to build from that £1 million a total of £7 million. From a relatively small investment it has been possible to make Scarborough an up-to-date, modern tourist town.

Mr. Crouch

I am grateful for my hon. and learned Friend's helpful intervention. I argue strongly that there is a case for selective assistance for the large residue of the tourist industry and the potential that exists in Kent.

Yachting and water ski-ing are not the only great sporting activities that can be enjoyed around Kent. Golf in Kent is second only to that available in Scotland. Many people will condemn me for saying that it is only second. I play myself on one of the great courses. On that course last year the Open championship was staged again after 25 years. Many hundreds of thousands of people were attracted to the event. It was a great success. The championship is to return there in 1985 because the infrastructure has been developed to contain the crowds and to enable them to have easy access.

I have only praise for the Kent police for their handling of the crowds at the championship. I praise the county officials who made the event possible. They are also to be thanked for enabling the bypass to be built around Sandwich in time for the championship. This was an example of local government doing its best to pull itself up by the bootstraps. It succeeded in attracting back the Open championship, and it is to stage the event again in 1985. That is a great feather in our cap. It greatly helps the local tourist industry.

Industry, business and tourism in Kent need help while there is still time. If help is not forthcoming, the situation will become much worse. Only a little help is needed to assist the area to get up and get going again. My hon. Friend the Member for Faversham calls for special recognition. I ask for a little more—I am the Oliver Twist in the debate—and I am determined to get it. I should like selective financial assistance to be given to our black spots in Kent for a limited period. I hope that the Government will at least consider the proposal and not brush it aside.

A selective approach should be adopted to identify special areas with problems. I want help for employers to create new jobs. They must create the jobs. I am not asking for help at special development area or development arc a rates. I suggest the intermediate area rate. The creation of 20,000 jobs would represent a great contribution towards lowering the figure of 60,000 unemployed. I cannot say how much my proposal would cost—it would probably be between £10 million and £40 million—but it would launch us on our way. It should enable us to show a dividend. It would not be wasted investment. It would save Kent from becoming a wasteland between London and the Continent. It would avoid our becoming a heavy charge on the Stale in the future.

One day we may find ourselves a special development area if action is not taken now. This is the time for the Government to take an initiative unfettered by red tape and any "Yes, Minister" attitude. We should say "Yes" to a little positive help to meet our problems in Kent while there is still time.

12.25 pm
Sir Albert Costain (Folkestone and Hythe)

I should like to congratulate my hon. Friend the Member for Faversham (Mr. Moate) for the skill he has displayed in proposing this motion and his brilliant survey of the situation. The problem that confronts the area can be demonstrated by the large attendance of hon. Members representing Kent constituencies. My hon. and learned Friend the Member for Dover and Deal (Mr. Rees;) has attended the debate but as a Minister he cannot take part. My hon. and learned Friend has indicated that I may speak on his behalf especially in relation to Dover because we are near neighbours.

There have been some remarkable speeches. The contribution of my hon. Friend the Member for Maidstone (Mr. Wells) was the most remarkable I have ever heard. It has always been a great mystery to me why my hon. Friend opposed the M20 link between the end of the Maidstone bypass and Ashford. The truth is now revealed. My hon. Friend told the House that he thought it would be better not to build a road which he does not use and that it would be better to build a road to London.

My hon. Friend made no attempt to assess the relevant cost value advantages. He overlooks the fact that the M25 is given priority. From my house in Surrey I use the M25, which joins up with the M20. I see masses of lorries that come off the ferries whose drivers have no wish to travel to London. They are heading for the West Country and the North.

Once the M25 is completed it will save the demolition of a large number of houses. I am sorry about the inconvenience for my hon. Friend the Member for Maidstone. His journey to London will not be quite so rapid. I live near to the A217. A large number of drivers use the M25 to get to London. The purpose of the debate however is not to discuss route patterns although this is a serious matter for Kent. We are here to talk about the serious problem of unemployment.

I do not wish anyone to infer from what I say that I do not realise the serious problem that unemployment presents. It is however necessary to view the situation in perspective. The reality is that customers, not Cabinets, give employment. It is the customers who produce employment. People work five days a week in order to produce British products only to go out on the sixth day and buy a foreign product. Anyone who doubts what I say need only visit the car park of the House of Commons and count the number of British cars and Japanese cars. Hon. Members are not free from guilt. I am ready to confess that for 40 years I bought a Leyland or other British car until last year. I buy a car for myself one year and another for my wife the next year. For 40 years I have done that and have been proud of buying British. When the strike became so bad my wife asked whether we should continue to buy Leyland cars. She asked "Hadn't we better buy a foreign car?" After 40 years of faithfully buying British cars I bought a foreign car. I am ashamed but glad to say that it is a satisfactory car. Not only Government, but industry and the customer produce the jobs.

Mr. Prescott

I take the point about the consumer having an effect on demand, but in the road industry, about which the hon. Gentleman is so knowledgeable, decisions are taken by Cabinet and that creates jobs.

Sir Albert Costain

It does not take much intelligence to realise that the Government build roads. But they must have cash to build roads. Cash is created by successful industry. The most serious complaint that I have about my Government is that they have not learnt from history about roads.

I am told that I am becoming an old man. I have lived through three depressions. Depressions always start with a slump in the construction industry and they are always relieved by a boom in that industry. We are always caught without plans. There is no excuse for the Government not preparing plans for the future. As a member of the Public Accounts Committee I have witnessed large amounts of money being wasted because when we want to stimulate employment the plans are not ready.

Large numbers of qualified consulting engineers could be employed to prepare the plans and documentation. The Secretary of State has decided rightly that consulting engineers should be employed in private industry. If consulting engineers are short of work why should not their technical ability be used to prepare drawings and plans so that when the time arrives—and it will be sooner than many people believe—we can get on with the job?

The problem is caused by Labour Governments who, unfortunately are elected from time to time. We once had 13 years of Conservative Government in the "never had it so good" era. As a nation we are so keen on cricket that we decided to give the other side a chance to get in. The Labour Party got in and we have suffered ever since. Labour Governments always introduce controls as the cure for everything. They imposed controls so that people could not be sacked without heavy compensation being paid. That may be desirable when the Labour Party is trying to show how clever it is in helping the working man. But did they help the working man? I do not believe that they did. As a result some people are not taken on because it is too difficult to get rid of them.

Because of Labour Governments the nation is controlled. Their policies caused the trouble in the construction industry. I am appalled that Labour Members say, "We must stimulate the building industry," when one of the reasons why the building industry is not being stimulated is that the Labour Party will not accept that private industry should build to let. The Government produced a suitable method for dealing with shorthold leases which would allow builders to build houses for rent. The hon. Member for Kingston upon Hull, East (Mr. Prescott) may laugh, but I happen to have had 50 years in the building industry. I have been through three depressions and have built a block of flats in which 46 Members of Parliament are now living. Why are they living there? They are there because my company, to stop a slump, built that block. It borrowed to the hilt to build it, not to make a profit as many people think, but to keep a team together in the middle of a slump. The company would like to do that again today, but it cannot because the Labour Party says that when it is back in power it will introduce more rent controls.

The hon. Member for Kingston upon Hull, East looks disgusted, but I must tell him that in 1960 I said to the Labour Opposition "If you will guarantee that you will not introduce more rent controls my group will build 5,000 flats in a year." Five or six other property companies said the same. That was 22 years ago and if our offer had been taken up there would be a couple of million more houses to let instead of the present poverty in housing. The Labour Party is one of the major causes of the slump. Companies now have to go abroad where there are no rent controls.

I represent the Shepway area and the Channel Tunnel is of special interest to my constituents. There has been one false start. We need a decision. The hon. Member for Kingston upon Hull, East has many shipping interests. I hope that he accepts that the current proposal for a Channel Tunnel will not hinder shipping interests as the previous one might have done. I believe that it will help shipping interests and give a stimulus to shipping. We want the work to start because of the employment that will flow from it.

The Channel tunnel would give us closer links with Europe. Folkestone would no longer be at the end of a cul de sac, but on the main line from London to Paris and Brussels and would become a residential area from which people could get to all three capitals as quickly as they can get to London today. A Channel bridge would not be viable, but I shall not trespass on the House's patience by developing that theme further.

My hon. Friend the Member for Canterbury (Mr. Crouch) opposes the Government's proposals for heavier lorries. There are about the same number of lorries on the roads today as there were 25 years ago, but they are carrying three times as much produce. Those who dislike big lorries should realise that, provided those lorries are quieter, they will have less effect on the environment. I have had several meetings with the Secretary of State for Transport and have told him that I will back him provided that the heavier lorries are quieter. There is considerable fear of larger lorries and I wish that the lorry manufacturers would get some quieter vehicles on the road to demonstrate that many of the fears are unfounded.

We all want more employment, but those in work often do not realise how much harm is done by strikes. Those of us who have sold products overseas for many years know how the talk and fear of strikes affects our sales.

It is almost a tradition that those on the shop floor strike. If they do not, they are considered to be blacklegs. That is a nasty word. Many trade union leaders are as anxious as we are to increase employment opportunities. Only trade union leaders with strong political elements in their unions want unemployment to increase. They gain political advantage from that, but the other trade union leaders, workers on the shop floor and Ministers should point out that the opposite of a blackleg is an industrial saboteur. I beg those who strike for fear of being called blacklegs to realise that they are acting as industrial saboteurs and will not only hinder the prospects of employment for themselves, but will stop new employment being created.

We have a great task ahead of us. We are fortunate to have a Minister who is so anxious to encourage small industries. I disagree with those who say that such industries cannot provide the answer to unemployment. In my constituency, the firm of Portex employed 14 men when I was first elected to the House. It now employs 800 men. Another firm that employed only a few men and owned a small, 40-bedroomed hotel when I was first elected is running the Saga organisation, which is doing much for the elderly. When that firm wanted to expand the Labour Government of the day did their best to persuade it to move from Folkestone to a development area. Fortunately, we were able to persuade Mr. de Hann, who ran the business, to stay in Folkestone and he has had great success there.

We have in Folkestone empty offices with rents much lower than those in London. A number of London firms that have come to the town have been surprised to find how convenient it is to have an office within five minutes of a golf course, a yacht club and some of the best sporting facilities in the country.

We are fortunate that in London a man called Livingstone is putting up the rates. In Folkestone we are getting inquiries from companies that cannot afford the high rates in London. From that aspect, long may Mr. Livingstone continue. His doctrine is wrong. Thank goodness, there is a Stanley in the Department who is taking the right attitude on rates.

12.45 pm
Mr. John Prescott (Kingston upon Hull, East)

I congratulate the hon. Member for Faversham (Mr. Moate) on giving us an opportunity to debate the South-East economy. The hon. Gentleman is not in the House at this moment. Perhaps he has taken the opportunity to take refreshment.

However, the congratulatory terms of the motion leave much to be desired—for example, on the measures to stimulate small businesses and industry generally. From the figures, it appears that there is a considerable collapse in the small business sector. Bankruptcies are greater now than they ever have been since statistics started to be collected.

The motion also congratulates the Government on their training policy, but such congratulations fly in the face of the evidence in the regions or a simple analysis of our training capacity. Perhaps the hon. Gentleman is congratulating the present Secretary of State for Employment on his policies. There has been a great fanfare for the announcement that £1,000 million will be available for foundation courses and other measures. The proposals will be more effective in reducing unemployment than increasing the skill of our work force.

We must consider the facts. Manpower Services Commission studies show that 10,000 fewer apprentices are being taken on. Sixteen of the 24 industrial boards—which had been given a statutory responsibility—are being closed. The science-based colleges and universities, such as Salford, are being cut. They could provide the training desperately needed for industrial development. We need to develop the skills of the generation who will have a considerable effect on our future economy. It is one of the great tragedies of the Government's policies that they are not doing that as our competitors are.

This is the second regional debate since my hon. Friend the Member for Stalybridge and Hyde (Mr. Pendry) and I were appointed to look at regional policy. I am sorry to have missed the West Midlands debate. It emerged from that debate that the Government are rethinking their regional policy. We await the conclusions with interest. My hon. Friend hails from Ramsgate and is aware of the situation in the South-East. There has been confusion on the Government Benches about what the Government should do. Some hon. Gentlemen believe that there should be Government aid, whether through a change in defence policy or through selective aid to black spots. Others believe that no action should be taken and that everything should be left to market forces. Yet others suggest that public expenditure does not have a major effect on employment.

The hon. Member for Folkestone and Hythe (Sir A. Costain) said that he had been through three slumps. He said that the building and construction industry was responsible for getting us out of them. But, in fact, we have come out of them only through Government action in those sections. Government action has brought us out of the slumps and not consumer money. It is a controversial matter at present, but all Governments have taken direct action to ease unemployment.

The debate is significant. I have listened to it with a great deal of interest and have learnt a lot. As I said, I was not able to attend the debate on the West Midlands. The West Midlands and the South-East have been referred to as lands of milk and honey. The reference may have applied only to the South-East, but it is significant that until not long ago they were areas in which unemployment was not a problem.

Mr. Rees-Davies

Thanet has always been an area of high unemployment.

Mr. Prescott

I am grateful to the hon. and learned Gentleman for that intervention. In the regional average sense, Hull has always been discriminated against, although its unemployment has warranted that it should have development area status. Eventually, some of us were able to convince the last Labour Government that that should be so.

The point that I was making was that the West Midlands and the South-East are not identified with deprivation and the difficulties that we associate with areas of high unemployment. Traditionally they have been wealthy areas, and wealth-creating areas. My hon. Friend and I have spent three days in the West Midlands this week, looking at the problems there. It is shattering to learn of the scale of unemployment in the West Midlands. The South-East is now beginning to be affected in the same sort of way. Indeed, we almost have what might be called a North-East problem in the South-East. The North-East has usually been an area of high unemployment.

Hon. Members have not gone as far as saying that the South-East should have development area status. The nearest to that was a call for intermediate area status. If anyone had made such a suggestion four or five years ago he would have been laughed out of court.

I am not suggesting that the problems of the South-East are totally due to Government policy, but I believe that the Government are responsible for a good many of the problems. Over the past decade, there have been developing problems in manufacturing, not directly arising out of strikes. There have been fundamental changes in our economy and they have to be taken into account. That has been said before but if I say it today from these Benches it might carry a little more weight.

The hon. Member for Gillingham (Sir F. Burden) referred to the Chatham area. I remind the hon. Member that a defence decision is a Government decision and does not arise out of structural or economic problems. A Cabinet decision of that sort has consequential effects in the area concerned. The policy of trading ships for missiles is a Government matter, and one recalls that a ministerial resignation took place in that connection.

The fact that the West Midlands and the South-East are now candidates for development area status shows that Britain is now well and truly on the dole.

Mr. Moate

The Labour Party is in favour of cutting defence spending by several billions of pounds. How would that be achieved without causing unemployment?

Mr. Prescott

I shall need all the time that I can get in the debate to develop my analysis of the problems, and I want to deal with them in my own way. However, I shall come to the hon. Gentleman's question shortly.

The central policy of the Government is crucial and cannot be ignored. Regional policy cannot solve mass unemployment. There is even some argument about whether it would resolve the problem when we have only a half million people unemployed. But the scale of unemployment, not only now and not only when we have introduced our package of programmes which are designed to reduce unemployment by millions and have a great effect in the South-East, is such that we shall still have to live with levels of high unemployment compared with the numbers in the 1950s and 1960s, when we had a half million unemployed. We are still talking about more than one million. No one here is kidding himself about that. My right hon. Friend the Shadow Chancellor made that quite clear when he put forward his package of proposals.

The challenge to regional policy is how to make it relevant to a country that is undergoing considerable economic change. It means that every region will have some scale of unemployment at both percentage and absolute levels compared with what we normally associate with development area status. The tragedy is that regional policy, as we understood it in the past—and it is undergoing considerable change today—would not have been sufficient to deal with the problems in our regions.

If we are prepared to accept that analysis, we see that regional policy has to be rethought. The Opposition have begun to attempt to see how we can make regional policy relevant to the national strategies that we believe to be crucial. We shall not resolve the unemployment problem without the correct national policies.

The other essential is a recognition that the economy will have to live with higher levels of unemployment than we experienced in the 1950s and the 1960s, whatever the nature of Government policy. Lower levels of growth are a further reality. We shall not have the high levels of growth that we had in the 1950s and 1960s. That being so, we shall not create the kind of wealth that we created previously, and resources will become more scarce and important. High inflation of today's kind will be the order of the day. Central policies of high public expenditure will produce high levels of inflation. But present policies are also producing high inflation.

We shall also live in a world of more hostile trading, and that will have consequential effects on the nature and mix of our industry. The rapid technological change now running through manufacturing industry will begin to run through our service industries as well, of which the South-East has a greater share and which have guaranteed its prosperity.

If those changes are taking place and if they are of the fundamental nature that I suggest, the regional policies that we envisaged in the past and which have been embarked upon by the present Government will not be able to cope with them. Frankly, we shall require a policy that is more Government interventionist than devolving decision-making from the centre to the regions.

Sir Frederick Burden

A few moments ago, the hon. Gentleman made an extremely significant comment. He talked about resolving the unemployment problem. Before that, he had made it clear that very high unemployment levels would remain, even after a Labour Government came to power. The problem cannot be resolved.

Mr. Prescott

I take the hon. Gentleman's point. We have to address ourselves to how we define "full employment". I am not seeking solely to make a political point. I am trying to present to the House my analysis of the problem. .

If it is argued that we are seeing considerable changes, we ought to ask ourselves whether the policies that we devise to resolve the problems are relevant. I believe that they are not, and I am trying to put forward some of my own thinking at an early stage because we believe that we are seeing considerable changes. That is why we are devoting a lot of time to visiting every region, spending three or four days in each of them looking at the problems. The South-East was one of the first that we visited to discuss these problems particularly with the Labour and trade union movement.

I am not entirely sure what new policies are relevant. I am inclined to think that it is best first to assess the difficulties. But I am convinced more than ever that an interventionist policy is needed but that it must be more flexible and more regional. The market forces will not resolve the problems. In Europe, there is no ideological difference about that, but apparently there is always an ideological difference here which unfortunately tends to exacerbate the problems. I believe that there is a role for ideology, but it should not be in place of analysis too often if it is shown to be in correct. We must always subject our ideas to such checks.

Regional policy can only complement central Government economic strategy. The present economic strategy is not adequate either in substance, resources or organisation and demands an increasing amount of decentralisation with an element of devolution. Perhaps the difference between the two words is a matter of semantics, but decentralisation is relevant.

Therefore, we must rethink Government involvement in the matter. At present, they have begun to take steps—they clearly believe in withdrawing from the position—including redrafting the areas of assistance primarily to reduce the amount of aid—their target saving is about £240 million—scrapping the regional planning councils, where regions can consider their priorities, the removal of industrial development certificate control and the weakening of the National Enterprise Board and its interventionist role, in which the Labour Party believes. The operation of Government policy has downgraded regional implications. That is at the heart of some defence considerations. The national implication is that we change from ships to missiles, but the regional implication is considerably more. I do not believe that it was taken into account by the Cabinet when it made the decision on defence.

Therefore, the essence of regional debate is that it should not be on the back burner on which the Government have put it. It should be to the front and in such debates we should always ask how we can improve the position. A review of the facts will show the shattering effect on the economy, much of which can be laid at the door of the Government's monetary policies and their effects upon the regions, despite the problems in the world economy. High exchange and interest rates and public expenditure cuts have all contributed—perhaps for a reason that the Government believe is good—to a reduction in output and investment since the Government came to office. The Government may well feel that the economy is getting back into shape, but the totality of consequences is to reduce output, investment, training and skills, which contributes to unemployment.

Anyone who considers the proportion of manufacturing in our economy, which has been declining for almost two decades, will know that it is a serious problem that must be arrested. Manufacturing in all countries has tended to decline, but the rate of decline here is considerably greater. We can argue about the reasons later, but the Government must direct their attention to arresting that decline. We may wish to deploy targets and import controls, but one cannot just talk about competition and hope that unemployment will solve itself. That is also true in the South-East. I did not realise how large the manufacturing sector is in the South-East, especially in its north-eastern part. The unions, and Labour Party when analysing the north-eastern area, produced reports entitled "The Medway Disaster Plan" and the "Destruction of a Community". Those reports show clearly how, since the Government came to power, problems have occurred in the manufacturing sectors of those areas.

It is expensive to have an interventionist policy. We all agree that it costs £12 billion for the present number of unemployed. The argument is whether that is the best way to utilise resources. The House should address itself to that pertinent question. However, the argument that our position is only a reflection of what is happening in the world economy is not correct, as an examination of the figures will show. If we compare the position in 1979 with that operating now, it will be seen that our level of unemployment has doubled. Unemployment in the United Kingdom has increased from 6 per cent. to 12 per cent. In the United States it has risen from 6 per cent. to 7 per cent. In France it has increased from 6 per cent. to 8 per cent. and in West Germany it moved from 3 per cent. to 6 per cent.

The increase in unemployment in the United Kingdom has been considerably greater than in competing economies irrespective of the world depression. The United Kingdom has moved from ninth place in the league of unemployment among the developed nations to the top of the league. The Opposition believe that the world depression has had a greater effect on levels of employment in the United Kingdom because of the consequential effect of Government policy.

Unemployment has doubled nationally but that has not had the same effect in all the regions. The West Midlands takes fifth place among the 11 regions with its unemployment percentage, but the increase within the region has been 150 per cent. That has happened in a wealth-creating area. The South-East has always had the lowest unemployment percentage, but it has increased by 190 per cent. since the Government came to power. That movement puts the South-East at the top of the list in the scale of decline among the regions. That has happened in an area that has never been associated with such decline.

The Government can claim the record of almost destroying two areas that have never before been touched by unemployment to such an extent. They are scarring them in a way that the debate has reflected. In the long term they are damaging wealth-creating areas. The West Midlands is especially important to the economy.

The Government's regional policy is insufficiently flexible to deal with that problem. It has been argued that unemployment percentages in north Kent and Chatham, when compared with the levels in similarly developed areas, make the areas eligible for grants. Under the present regional policy it will not be possible to make them development areas. It is impossible at present to say that Chatham will become a development area. The unemployment percentages in the development areas, intermediate areas and assisted areas are greater on average than the percentage for the South-East region. The House will understand that regional considerations determine development status.

It is always possible to use a back-door method, and section 8 of the Industry Act 1972, a Conservative measure, makes that possible. It is a method that has been used by Conservative and Labour Governments. The 1972 Act is one of the greatest interventionist measures that we have had. Both Labour and Conservative Governments have used it and neither party, when in Government, has thought to get rid of it. Indeed, there is no suggestion that the present Government want to get rid of it. It is an intervention tool that allows Governments to respond, not necessarily to the economics of an argument, but to political pressures. It enables Governments to give way a bit and to make an allowance. Unfortunately, that tends to syphon off the pressure and fundamentally to change a policy. It is traditional that there is always a back-door method of taking off the pressure. That may protect us from having revolutions but it militates against an effective regional review when the Government's policy is found wanting.

The South-East is especially affected by the Government's policy as there are levels of unemployment of 17 per cent. and 18 per cent. in some areas within it. It must be remembered that those percentages exist even before the closure of the Chatham naval dockyard and BP.

Sir Frederick Burden

There is 14 per cent. unemployment in Chatham.

Mr. Prescott

Yes, but the hon. Gentleman has told us that it will increase to 22 per cent. if the dockyard closes. Others have said that it will increase to 25 per cent. and even to 30 per cent. So many towns have been scarred by unemployment. The list includes Corby and Durham, and now Chatham is to join the list, where possibly one in four will be unemployed. When talking about Chatham I am including the travel-to-work areas. That is the result of the Government's policies and the depression that is to be found generally throughout the economy.

The hon. Member for Faversham believes that many of the Government's measures are right. He feels that generally they are on the right course. I know that the hon. Gentleman has that view as I have heard his arguments during transport debates and debates on other areas of policy. The reports that have been produced by the unions show that expenditure cuts had a considerable effect on employment in the Kent area in 1981.

The reports say that 5,000 jobs were lost through the action of Kent county council. That Tory council perhaps decided to go for low rates and put 5,000 people out of work to justify it. Hundreds of transport workers have become unemployed due to the transport policies in that area, which the Government are trying to impose on South Yorkshire and everywhere else. The hon. Member for Faversham supports that policy. When one adds together all the figures from the reports, one sees that there have been about 1,000 redundancies a month in that area in 1981. That is a colossal amount.

I have considered Chatham and Portsmouth against the backgrounds of the reports produced by the unions and the Labour movement. I shall give the Minister a copy of them if he does not already have one. They are an excellent analysis of the problems. Those men are not asking for charity but the problems should be dealt with and recognised. Action should be taken to help. The Government's policy for Chatham and Portsmouth has dealt a considerable body blow to the people there.

There is a clear difference between the Government and n the Opposition on defence policy. We are committed to the cancellation of Trident. During the election the Conservatives said that the Labour Party would be the ones to reduce defence expenditure and throw everyone out of work. The people did not vote for us, but they are still going out of work.

If one could believe that defence expenditure cuts would benefit the economy, at least we would have that consolation. However, we are now embarked on the crazy policy of Trident. That gives us a more expensive defence policy without the added benefits of keeping men in work. That policy is dressed up in a paper called "The Way Forward". The way forward is to more mass unemployment in that area arising directly out of the Cabinet's coldly considered policy. Despite all the reactions of Tory Back Benchers, the Government are still embarked on putting that policy into effect.

I accept that the Minister is not directly responsible for defence policy. However, I have read the parts of the defence debates that related to the effect on unemployment. The reality is that 6,000 jobs will go in Portsmouth. Chatham will lose 7,700 men. The refinery has been closed. There could be a multiplier effect, with 20,000 or 30,000 jobs being lost. There are various estimates. There is no doubt that that will have a considerable effect on the economy. The hon. Member for Gillingham made that clear in presenting the fears felt by his constituents. I almost felt that the Opposition were implementing the policy when the hon. Gentleman cast strictures upon us. However, that is a direct Tory Government policy decision, that the hon. Gentleman fully supports.

Sir Frederick Burden

I do not support that policy.

Mr. Prescott

I accept the hon. Gentleman's criticism. However, the Government's overall policy is fully supported by the hon. Gentleman. The Tory defence policy and the Tory economic measures are supported by the hon. Gentleman. Apart from Chatham, I cannot think of many occasions when he has voted against the Government.

Sir Frederick Burden

I do not support the defence policy.

Mr. Prescott

Clearly there are differences of opinion. But there is no doubt that we are producing armies on the dole. There is dramatic evidence of that today.

The unions and the Labour movement who made the reports are saying to the Minister "Please change your policy". The hon. Member for Gillingham hopes that the Government will be influenced to do so. If that cannot be done, the Minister should take into account the circumstances of those in the area so that their difficulties are alleviated. Then they can deal with the problems associated with unemployment.

In their analysis the unions have looked at what they can do. They do not believe that the area could be made a special development area. They disagree with the policy, but they ask what we can do with the resources that we have. In that sense they fit in with the traditional Tory philosophy of helping oneself. They have looked at the parts of industry that use high skills. Mention has been made of tourism and associated employment, such as people who sell ice creams. There is much to be done in that area. The hon. Member for Gillingham is right. Jobs on this scale will not be created through tourism.

Skills are available in an area that the nation should not lose, although they should perhaps be used other than for weapons for war. The workers themselves have said that those skills might be used for other industrial applications. They have highlighted the programmes that they see as their way forward. Perhaps the Minister can tell us whether consideration has been given to such developments.

It is no use advancing the argument that small businesses will grow to pick up all those workers. Small businesses will not grow at that rate. The bankruptcy rate among small businesses is already very high, and the multiplier effect of unemployment on this scale in South-East will put a few more small firms out of business, thus accelerating the decline of the area's economy.

As for talk about money from the EEC, that provides £7 million per year compared with the £600 million which used to be the average payment, so one cannot look for much response from that quarter.

Mr. Rees-Davies

The hon. Member has been speaking for half an hour already. If he would give some of us a chance to say a few words, we could explain exactly what the EEC could do in the substantial development of tourism—facts of which I am only too well aware and the hon. Gentleman is clearly not. Several hon. Members wish to speak. I hope that the hon. Gentleman will conclude his argument and give us a chance to do so.

Mr. Prescott

A minute for minute comparison of the amount of time taken by the two sides—a principle that the hon. and learned Gentleman himself does not always readily observe—will show that the Opposition are putting arguments for the labour and trade union movement that have not so far been dealt with, and we shall take an amount of time not disproportionate to our strength in the House. That is one reason why I said that I did not wish to take too many interventions. I assure the right hon. and learned Gentleman, however, that I have almost finished my speech.

The unions have made clear the kind of programme that they would like to see implemented. They have outlined their own way forward, but they need assistance—not necessarily in money, although that is perhaps part of it—but certainly either a change in the ships and ports formula to provide time, or a delay before the decisions come into effect. I hope that the Minister will give the Government's views on that.

Secondly, the unions want an instrument of development to innovate and to put the financial package together, as is being done by the enterprise boards in the West Midlands and the GLC area. The workers called for that, but unfortunately they live in a Tory area with a Tory council which is utterly opposed to that kind of thinking and to the idea of using rates money to assist development in that way. Indeed, I assume that the Government have embarked on cutting even the rates money available for development purposes under section 137 of the Local Government Act 1972, so there is little hope there.

When one considers the small amount of money involved in this, when Nissan is shopping around the country looking for a place to locate its industry and grants of some £180 million are being considered for industry of that kind, the Government's thinking on regional policy is clearly exposed. We shall wish to say more on that when the decision has been made, as I know that these are sensitive matters, but I put it on record now that in that respect the Nissan development throws into question the Government's entire regional policy.

The regional implications of the Channel tunnel must also be taken into account before a decision is reached. It is not just a matter of Kent or shipping. The Opposition recognise that current regional policy is too inflexible. It now has to deal with fundamental changes in our economy and it must recognise that every region is entitled to some allocation.

New thinking is required. The Government have started theirs—to withdraw from the scene. We take exactly the opposite view. The Opposition believe that there must be a more interventionist policy at both central and regional level. That will provide a clear choice for the electorate. The debate today has shown, as I have made clear, that the problems of the South-East primarily arise directly out of Government policy, and I am sure that the people of the South-East will recognise that fact when the time comes.

1.20 pm
Mr. Tim Brinton (Gravesend)

The hon. Member for Kingston upon Hull, East (Mr. Prescott) made much use of the word "intervention". However he did not deal with the history of intervention. As he spoke, I reflected that intervention at regional level has increased in line with unemployment problems. There has been considerable intervention, but it has not solved the problem. To opt for more intervention might increase the problem.

I have listened with great interest to the speeches made today and have reflected on the image of an unemployed man or woman who is interested enough to listen to our deliberations to discover whether we are achieving anything on his or her behalf.

In the past year or two, I and many other hon. Members have sat through many debates here and conferences on unemployment. I often wonder whether people think that politicians, although their job is to talk, talk too much and do not do enough. The sad history of this matter has been discussed, but one aspect of the present situation has not been mentioned. While in the past 10 years we have paid ourselves in Britain over 300 per cent. more than we got 10 years ago, our productivity and the GNP have risen by only about 1 per cent. a year. If we were not a nation, we would be bankrupt. We are not paying our way, and eventually the bubble has to burst.

Therefore, we are discussing today the agonising birth pangs of a nation forcing its way into a modern society, wondering how it will survive and how to keep some continuity with the old as it changes so dramatically and quickly to the new.

There are many problems in my constituency. I am still not persuaded that the Chatham naval dockyard will close. The defence argument that we cannot service our nuclear submarines only at Devonport is the strongest argument for its retention that I know. At the end of the day, some action must be taken to keep an alternative refitting base.

When I consider the tip of my constituency and the closure of the BP refinery on the Isle of Grain, I see a tragic example of what has happened throughout Britain. The mathematics of refining oil in Grain are simply against the possibility of preserving jobs. The Opposition have suggested that the Government should subsidise the continuing of refining at the refinery. What is the purpose of that if one cannot sell the product? It will only drain even more taxpayers' money and, ultimately, will mean the loss of jobs elsewhere. Every £1 million of public money, from Government or local government, invested here will inevitably cause risk to jobs elsewhere. We must understand that.

The paper industry's problems have also been mentioned. A lack of modernisation in many parts of the industry has played its part in those problems as well as the high fuel costs, to which my hon. Friend the Member for Faversham (Mr. Moate) referred.

Another difficulty is that of finding jobs for certain unemployed people. I attended a jobcentre in my constituency recently and, looking round, it was easy to identify those who would be unsuccessful in securing the few vacancies.

The vacancies notified from 8 January to 5 February at Gravesend jobcentre divide easily. There were 245 vacancies for jobs that involved skills and training but only 58 vacancies for those with no skills and no training—the general labourer, the porter and the warehouse man. I do not say that those occupying such posts are not qualified. However, they do not have the same potential as those who are skilled. They are the people who will suffer in the new society described with such eloquence by hon. Members.

This raises the question of training. The hon. Member for Brent, South (Mr. Pavitt) stressed the importance of encouraging apprenticeships. I agree. There is a distinct sign that the number of available apprenticeships is falling because of unemployment. But a problem still arises in finding young people who are sufficiently keen and interested and also qualified to take apprenticeships.

I asked, on a recent visit to a works in my constituency, whether the foreman had difficulty finding apprentices. His answer was "It is not very easy because we have to give them a fairly simple test. They have to be able to multiply one half by one third in order to do fairly simple measurements." The foreman told me that few people capable of completing that simple test were applying for apprenticeships. They were going to colleges of further education. I do not condemn those young people. I suggest, however, that the educational system often encourages people to take courses in further education when it would be more practical for some of them to take apprenticeships.

More problems are to be found among 15 and 16-yearolds. Too frequently, I have heard teachers encouraging young people to look for white collar jobs and girls to take jobs in banks. Many of those people would be happier in industry as industry develops.

I turn now to the problems of north Kent. I should like to congratulate the district councils of Medway, Gravesham, Gillingham and Swale and, of course, the Kent county council on the manner in which they have tackled the grave problems we are discussing. By its nature, local government is not entirely fitted to face a crisis of this magnitude. Its bureaucratic system has been mentioned by my hon. Friend the Member for Maidstone (Mr. Wells) who made some startling remarks about the county council's habit of building roundabouts. I do not wish to be drawn into the argument.

The county surveyor in charge of his department will surely carry out the policy laid down by the members of the county council and must have some responsibility for his designs. My hon. Friend the Member for Maidstone spoke about a subway to the headquarters building of the county council. That subway was built a long time before the reorganisation of local government in 1974. The present county council had little to do with it. I was elected a member of the county council in 1974 and the subway had been built.

What are the county and district councils to do? They can and should create the spark that will set light to the future of the area. I look forward to the appointment of a supremo to co-ordinate the efforts of all the councils. I know that the Secretary of State has taken that on board. That is the moment that the Government should enter the fray. I do not plead for special assistance, but once a strategy has been laid down locally, preferable led by a supremo, the Government must turn their attention to the responsibilities that they have taken on by their decision on Chatham dockyard. They must complete the M20 so that there is a proper channel of traffic to Dover. They must complete the M25 and help with local roads in areas where new industry is being built such as the A226 at Gravesend and the A249 at Sheerness.

The Government can take other action. They could show daring and imagination and, in facing the crisis, take more calculated risks. I hope that the Channel tunnel will go ahead. If we go for the one tunnel we do not take the most daring route. I am not convinced that the Euro-route bridge-tunnel is unviable. If it is not, it is appealing because the jobs created in Britain would be more numerous than if we took the other option.

Only yesterday in the House we discussed the advent of direct broadcasting by satellite and, logically, the advance of cable television. If the Government, without spending any taxpayers' money, were merely to press the button for the development of the fibre optic cable, thus releasing the forces of the free market that the Conservative Party supports, massive investment would result with great enthusiasm for rewiring the whole country. That would result in the creation of many jobs, both skilled and unskilled, without mentioning the hardware for the technology involved.

There are many plans. The Minister has seen one plan submitted to me by a constituent, Mr. Higglesden who lives at Hoo. When I first read about the plan, I thought "My goodness, he has worked very hard on this, but where are we?" Then I remembered Sir Barnes Wallis and the bouncing bomb. Mr. Higglesden is an ex-mariner who suffered an accident 10 years ago. He is a man of not too great education, but he has devised a plan to reclaim—as have the Dutch and the people of Hong Kong—large areas of useless mud flats on the estuary of the Thames and other parts of Britain on the simple principle of building Mulberry harbour-type walls and infilling with sand and various other bits. He suggests that, on the reclaimed land, we could develop our new technological age, build nuclear power stations and so forth.

The idea is probably not totally practical but it merits consideration in relation to the attitude that Government can take. Inevitably, the turndown came. We were told that the conservationists would not like it and that there might be implications for public expenditure. We must be more flexible and elastic. The days when the conservationist wins at the expense of the development of jobs must end. We must go into the new century, perhaps 18 years early, with energy and daring, sometimes taking that calculated risk.

1.34 pm
Mr. Jonathan Aitken (Thanet, East)

If the debate does nothing else, I trust that it will bury once and for all the myth so beloved of the Opposition that only the North and the Midlands suffer the worst effects of unemployment and that the streets of the South-East are paved with gold.

Many of my hon. Friends have eloquently made clear how badly their constituencies are suffering. My hon. Friend the Member for Faversham (Mr. Moate), who opened the debate with such eloquence and skill, represents a constituency with an unemployment rate of 17.5 per cent.—5 per cent. above the national average. My hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies) and I—the tail-end Charlies in the debate—represent constituencies with an unemployment rate of 15 per cent.—again, well above the national average. In some parts of the area, including Margate where the unemployment rate is 18 per cent., the situation is even more difficult.

East Kent is a Cinderella corner of Britain and has had a harsh battering from those two ugly sisters, high unemployment and high inflation. But it is not all doom and gloom. We are seeing the corner turned at present, because the haemorrhage of closures and job losses has been staunched and there is now a slow but perceptible transfusion of new jobs being created by gradual expansion. In my constituency, most of the major employers have indicated that they have already started, or will soon start, expanding again, taking on more labour as they do so.

GEC, Racal and British Oxygen are all on the upswing and say that they are likely to take on more labour in 1982. There have been some bigger success stories, such as Fernhill Precision Tool Company of Ramsgate, which will be taking on 60 new jobs before the summer; and several small service industries and businesses are also expanding.

I take the opportunity to pay tribute to my hon. Friend the Under-Secretary of State for Industry, who is to reply to the debate, for his excellent work in getting a bigger share of the Government's cake for small businesses. Several in my constituency have benefited from the small loans guarantee scheme, which is still not publicised enough, but has been a major step forward. I congratulate my hon. Friend and apologise for the fact that, owing to a constituency engagement, I shall not be able to stay to the end of his speech.

Above all, it must be stressed that the labour market, even in the difficult areas of east Kent, is not a stagnant pool of hopelessness. There is a steady turnover of jobs, as I can illustrate with figures from my constituency. There are 7,900 people on the unemployment register in Ramsgate today, but a close examination of the figures shows that in the past year 7,300 moved off the register into employment. One-third were placed in work by the local jobcentre, and the other two-thirds somehow found work for themselves, probably elsewhere in the South-East.

If 90 per cent. of those on the unemployment register at the start of a year move off it during the year—even though they may have to spend several worrying and depressing months looking for work—the situation may be described as difficult, but it cannot be described as disastrous or hopeless.

I should like to say a few words about the role of the Manpower Services Commission in Kent. I hope to convince the Government by local illustration that there are one or two constructive initiatives that could and should be taken to improve the situation.

The number of long-term unemployed—those who have been out of work for more than a year—is growing alarmingly nationwide. I commend to the Government the recommendation of the Select Committee on Employment, on which I serve, urging that the community enterprise programme should be increased from 30,000 to 60,000 places a year.

In my constituency we know what a useful job the programme can do. We have one excellent project, Smeeton's dry dock in Ramsgate, which is being restored and renovated by 16 men who are paid £75 a week by the State. The quality of their work and the hope that it gives to those men has been a considerable encouragement.

My constituency could easily take several more community enterprise programme projects and places. There is a project on the boards to resore a windmill at Sarre. I hope that the MSC budget will be able to extend to that.

Above all, the MSC must work hard to sell its youth training scheme, which comes into operation next year and which is so well supported by the Government. In Kent and elsewhere there is more reluctance among the young unemployed to go on the youth opportunities programme than ever before. It has recently had a bad press and too much bad-mouthing from the Opposition. As a result, many young people now say "We do not want to be cheap labour." Irresponsible though it is, I believe that the criticism will grow when the youth training scheme, offering only £15 a week, which is less than the YOP, comes into force.

The answer to such criticism is to make it clear to all young unemployed people that the YTC is new and offers a constructive and positive training programme in that vital year. The Government will be spending £1 billion on the scheme, compared with the £400 million on the YOP. It must be seen as a new scheme, not just a re-run or upgrading of the YOP.

A great deal can be done, too, in discussions between the MSC and the education service. Too often, time on the YOP is wasted by young people having to be educated in the basic facts of work—such as income tax and national insurance. Schools can do far more to contribute to the vital and radical scheme of youth training.

In the context of training schemes, I commend to the House an imaginative scheme, which I believe is being announced in county hall today and which is put forward by councillor John Thomas, the chairman of the Kent fire and public protection committee, for outward bound training based on the old fire service cadet and police cadet schemes, which have been abolished as a result of Government expenditure reductions. The schemes were always useful and valuable. The infrastructure for them—buildings, instructors and other facilities—is still in place. If, with help from the MSC's £1 billion budget or from any other revenue, the infrastructure can be used to train young people in Kent, councillor Thomas believes that as many as 400 places could be used for first aid, general discipline and other training in which the instructors are skilled and which would be of great benefit.

The MSC could take a more positive and flexible line in implementing schemes in Kent. For example, the enterprise scheme allows a man to be helped so that he can come off the dole when he is starting his own business. A constituent of mine, who is an upholsterer in Ramsgate, desperately wanted to get a business, for which he was eminently well qualified, going. He was told that he could get help if were in Rochester, but that the scheme did not extend as far as Ramsgate. Such infuriating answers are deeply resented in Thanet. I am in constructive correspondence with the chairman of the MSC about such attitudes. Greater flexibility, geographically and in every other way, is needed.

I am conscious of the time, so I conclude by raising my eyes from the parochial to the national and international levels. We have so far discussed palliatives rather than radical cures for unemployment. We need a rising tide to lift all boats—a stimulus to growth in the economy as a whole. Much the most hopeful development for the national economy and for world trade recently has been the sudden and dramatic shake-out in oil prices. I believe that this shake-out has only just begun. The price of a barrel of crude oil—which was $40 a barrel only a few weeks ago and is now below $30—will come down to $25 a barrel during the course of the year. That is the kind of boost to world trade, and the kind of blow to inflation, which should almost cause dancing in the streets of the South-East of England, in Kent, and throughout the nation.

A stimulus to world trade means that demand will surge back into the economies of Western Europe and, we hope, Britain. There will be a reduction in the rate of inflation, a possible fall in the exchange rate and, above all, a transfer of wealth from the oil-producing countries to the oil-consuming countries, which are much more effective in investing their surpluses in jobs and in industry generally.

It is extraordinary that sounds of lamentation about the fall in oil prices should come from the Treasury on the ground that it somehow denies the Chancellor some revenue. It may deny the Chancellor revenue, but it will put money into the pockets of industrialists and labour generally. It is the best news that Britain has had for many a day.

Napoleon said that the quality he most looked for in his generals was luck. Our Prime Minister, as her current career shows, has on the whole been a lucky general. After a certain amount of bad luck, with a world recession blowing the Government's economic strategy offstream, I foresee a scenario in which the good luck of falling oil prices will blow the fortunes of the Government and the nation back on to the uplands of prosperity and growth, which we so badly need.

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

My hon. Friend the Member for Thanet, East (Mr. Aitken) and myself are finishing up before we hear the Minister. It is a great advantage for me to be able to say straight away that I adopt every word of my hon. Friend's speech which was an invaluable backcloth to the problems of Thanet.

I turn almost immediately to what I would call the constructive cures for unemployment. I want first to ask the Minister three specific questions and then to develop them. First, with regard to the tourist industry—I stress "industry"—will the Department of Industry and of Trade carefully consider whether the tourist industry should be left to the Department of Industry rather than to the Department of Trade? After many years' consideration, I am satisfied that the Department of Trade is unable to give the necessary time, effort, knowledge, technique or ability to handling these matters effectively. They would be very much better dealt with by the Department of Industry. After all, tourism is an industry.

From that first question flows this one. Will the Secretaries of State for Industry and for Trade, and others, consider setting up a joint committee so that the experience and expertise of their two Departments can be brought to bear on the expansion of our most successful industry—tourism?

Will the Minister consider whether it would be right for Thanet and the South-East to become an industrially assisted area? May I remind his Department that in the 1950s, when I was Member of Parliament for the whole of the Isle of Thanet, I successfully pressed for Thanet to become an industrially assisted area and it became one. The result was the introduction of all our factories—Pfizers, the whole of the Westwood estate, Triang and others—and 3,500 jobs were injected in a matter of a few years. Many factories were introduced, all of which are now both modern and successful. None of them has failed.

The most successful city for tourism in the whole of the United Kingdom is Canterbury. It is the only one which, against all odds, has steadily increased the large intake of tourism. Sadly, for reasons which it is easy for me to give quickly, what applies to Canterbury does not apply to Herne Bay or to the towns of Thanet and the South-East, which, I if I may say so, have had a difficult time.

On 8 December, all Kent Members of Parliament met all the leaders of Kent county council. I refer to the note of what I then introduced and what was agreed. I said that East Kent had suffered its worst year ever and pressed the Government to include this area in its assisted area scheme, in which at present five regions only, mainly manufacturing ones, were receiving help. As a result, tourism in Scarborough has received £1½ million". As an interjection, I point out that it has been turned into £7 million.

The note continued: He proposed that the Government should consider the areas to which it gives assistance and that East Kent, with Canterbury at the centre, going out to Herne Bay and round to Folkstone and Hythe, should become an assisted area. I indicated that there should be a designation "tourist assisted area" and I said that we were going on to discuss it. The tourist sub-committee, of which I am chairman, has discussed it and has not had the satisfaction from the Government that I believe it should have.

If the Minister and his advisers will look at the picture in France, they will see that the immense development in the Camargue comes largely from industrial assistance grants to the French Government from the EEC, although it is a tourist project.

The fact that the Kent project is a tourist project should in no way militate against it, nor does it do so in the five regional areas where large grants have been given for the development of museums and railways, and for the development of hotels, with the result that those five areas are will advanced. But in the South-East, which has every bit as bad unemployment as any other—with 18 per cent. unemployment in Margate—everyone has turned a deaf ear.

The tourist industry as a whole in Britain simply cannot understand why Government after Government, year after year, will not recognise that the industry is entitled to some assistance and some advantages. They are always denied to the industry.

The sum of £4 million under the 1970 Act is pitiful. Even that money has to be given only in the five assisted areas. I demand that that provision shall be swept away and that in future that pittance shall be paid into whatever area the English Tourist Board believes to be right. That is the first change that must be made.

Secondly, I ask the Department of Industry and the Department of Trade to confirm that I am right in saying that the EEC can make grants to Britain for infrastructure purposes, even though they are designed primarily for the purpose of tourism. I believe that such grants can be made. If I am correct, there is no reason why the £7 million which has hitherto been paid should not be increased. Under that umbrella, it would be perfectly possible in East Kent and in Kent generally to get the grants for the road infrastructure, on which my hon. Friend the Member for Faversham (Mr. Moate) always elaborates extremely effectively, as he did in his speech today. That is one of the ways in which we can make progress.

Why is that we always back failure and never reinforce success? Why is that we can find £50 million or £100 million for British Leyland to become profitable, when the £20 million that would be more than enough for a true investment in the tourist industry is not forthcoming?

The English Tourist Board has calculated accurately that for £4,000 each it can guarantee to produce additional jobs. There is no doubt that it can. There are 50,000 jobs available. The hotel and catering industry is woefully short of labour at a time of very high unemployment. I am not referring only to those who have to wash down the kitchens. There are many other jobs available in the industry. If we make an investment in our most successful industry, we may be able to get great advantages from it.

With regard to youth unemployment in Kent, I recognise that some marvellous work has already been done by the Government. My hon. Friend the Member for Thanet, East did not have time to mention it, but there is in existence the first-class new young workers' scheme whereby employers can take a subsidy of £15 a week for each young person whom they employ earning less than £40 a week. It came into being only in January with a budget of £60 million for the current year. There were about 20,000 applications in the first month.

Will my hon. Friend make sure that the existence of the scheme is thoroughly well known in the country and more especially in Kent? I suggest that a circular should go out informing hoteliers categorically that if they employ young people who may well be prepared to take jobs for £25 a week or less, they can make up the money. There are many vacancies that could be filled by taking up that scheme.

I also support what has been said about the community enterprise programme for the long-term unemployed. This again could be expanded to take in the whole area of Kent.

At the moment, there is an enterprise allowance scheme in the Medway area to help unemployed people start up their own businesses by paying them an allowance of £40 a week. It is proving to be extremely effective. If it exists in the Medway, it should also be introduced into the East Kent and Thanet area, which is an equally serious unemployment black spot.

Councillor John Thomas and others in the Kent county council, including its able director Nick Stacey, recognise that there are ways in which we can have community service to immense advantage. Here, of course, my hon. Friend will need to have discussions with the Department of Employment as well as with the Department of Trade. There is a tremendous opportunity for a voluntary scheme with one year on a residential basis, a three months' general course followed by nine months of optional activities in one of three main streams. The first comprises social work in nurseries, centres for elderly and handicapped persons and hospitals. The second takes in such services as the police, the fire service and seafaring. The third covers environmental activities in our inner cities, in forestry, in the National Trust and also in farm management.

In this way, young people could join in and begin to learn how to serve the community for a period of 12 months. It would train them to render those services. It would encourage them to help themselves. They would get initial training experience in a variety of activities working as a team in a small supervised unit. Given the addition of various sports facilities and with a full range of cultural activities, we could see the creation of a voluntary scheme that would be of immense advantage, and it could be taken into any area where there was residential accommodation available, such as that on old Army camps.

With Government co-operation, the result is likely to be first class, though these are only some of my ideas for the creation of a constructive future which can really hit into unemployment. I hope, too, that the Department of Industry will accept responsibility for tourism, as well as others, in the course of its work.

1.58 pm
The Under-Secretary of State for Industry (Mr. John MacGregor)

I congratulate my hon. Friend the Member for Faversham (Mr. Moate) not only on his choice of subject but on the admirable way in which he opened the debate.

What is interesting about the debate is that there has been nothing negative in it. We have had many interesting and constructive contributions from a number of my hon. Friends. My hon. Friend the Member for Rochester and Chatham (Mrs. Fenner), who is on the Front Bench at the moment, and my hon. and learned Friend the Member for Dover and Deal (Mr. Rees), who was on the Front Bench earlier, would have liked to contribute from the viewpoint of their constituencies had their ministerial duties not prevented them.

I have attended many regional debates and spoken in many others in the past 12 months. This one has been a valuable antidote to those others because it has demonstrated that the difficulties of economic, industrial and structural change are not confined to the parts of the country which, historically, have suffered a decline in what once were prosperous, well-established and modern industries. That is especially important in the context of regional policy and the constant demand from Labour Members at Question Time and in many other ways for much more to be done and much more to be spent in their areas, despite the fact that substantial sums of taxpayer's money are concentrated on them already.

It is a pity that so few Labour Members were present today, although I understand why, because they would have learnt of the needs of other areas and of the possibly unfair competition between individual areas and firms as a result of regional policy, and of the need to get the balance right in the spending of national resources. I understand my hon. Friend's concerns. My county shares many of the problems to which attention has been drawn today and is also non-assisted.

My hon. Friends have covered subjects that are the responsibility of many Departments and I am sure that they will understand my difficulty in replying to them all. However, I assure them that the matters with which I cannot deal today because of lack of time will be drawn to the attention of my colleagues in other Departments to ensure that all the comments made today are fully known.

We have had wide-ranging speeches, not only geographically but on major issues of national economic policy, especially from my hon. Friends the Members for Epsom and Ewell (Mr. Hamilton), Gillingham (Sir F. Burden) and Folkestone and Hythe (Sir A. Costain). I hope that the House will forgive me if I do not go too much down that route today. We have had many opportunities in the House and we shall have more next week to talk about national economic policy and I have much to say about the motion.

I was interested to hear the opening remarks of the hon. Member for Kingston upon Hull, East (Mr. Prescott) about regional policy, which were thoughtful. I am glad that he acknowledged with realism, rarely shown by his hon. Friends, the economic environment that we now face. He reflected fairly on the technological change and the impact of hostile world competition. I am glad that he accepts that much of what is happening today in our economy is a result of the changing world position, not least because of the successive oil crises, although he might have acknowledged the Government's efforts to deal with Britain's longstanding economic and industrial uncompetitiveness, which the Labour Government did so little to solve.

I am very much aware of the impact of interest rates on small businesses and on all business. However, the right hon. Member for Stepney and Poplar (Mr. Shore), in putting his alternative budget this week, did not contribute to solving the problem but added to it. To put forward a budget expanding public expenditure by £9 billion would simply ensure that interest rates went through the roof, which would have a savage effect upon the small businesses for which the hon. Member for Kingston upon Hull, East said that he was talking. Much of what he said pointed to more Government expenditure without a recognition of the effect on the rest of industry and the wealth creators. My hon. Friend the Member for Maidstone (Mr. Wells) sensibly reminded the House that when we urge more Government expenditure in any area we must think carefully about the impact on industry and on interest rates.

When the hon. Member for Kingston upon Hull, East was talking about the proposal for the Chatham dockyard, he was shedding crocodile tears. It was sheer humbug if we consider the cuts that the Labour Party would make. It was noticeable that the shadow spokesman on defence, the right hon. Member for Deptford (Mr. Silkin) was careful in the way in which he phrased his comments during the debate the other day, because he knew well what the reality would have been.

Hon. Members have concentrated today on the Medway towns. I say immediately to my hon. Friend the Member for Faversham and my hon. Friend the Member for Gillingham that the Government are sympathetic to the problems in their area, recognise the importance of action being taken to deal with the implications of the rundown and are prepared to respond urgently. Fortunately, we have time to think the matter through because there is a period before the impact of the rundown begins. I cannot stress enough, as my hon. Friends have done, the importance of local initiatives in dealing with the matter.

We recognise the severe problems that north Kent faces over the closure of the naval dockyard at Chatham. The yard employs about 7,200 of which 2,200 are non-industrial staff. It is the major employer in that part of Kent. It is some consolation to the area that the rundown will be gradual. It is expected to continue until March 1984. A proportion of the work force can be expected to retire during the rundown. It is hoped that a proportion of the remainder will be offered jobs elsewhere in other naval dockyards or in other departments. Many of those who face redundancy have valuable skills that are easily transferable to other industries. Therefore, they are an asset to the area in any future industrial development.

I say to my hon. Friend the Member for Gillingham that on the information that is available to me we are talking about a period when many things could happen in the economy. I think that his estimate of 23 per cent. unemployment is well on the high side, and we must hope that that is so.

The Government recognise that the area faces a difficult task in adjusting to the loss of its major employer. Ministers have been anxious to see the problems for themselves and to discuss with the local people the action that needs to be taken. Thus my right hon. Friend the Secretary of State for Defence attended a meeting on 11 December with local authorities, trade unions and employers. On the same day, my noble Friend the Minister of State for Defence Procurement visited the dockyard. On 22 January my right hon. Friend the Secretary of State also paid a visit to the dockyard to see for himself the potential for redevelopment of the redundant land and buildings. On 10 February my right hon. Friend the Secretary of State for the Environment also visited the dockyard. That is an indication of the Government's concern and interest.

Sir Frederick Burden


Mr. MacGregor

I hope that my hon. Friend will forgive me for not giving way. I feel that I should get on with my speech.

The Secretary of State's meeting at Maidstone on 11 December was attended by over 50 local representatives. There was a wide-ranging discussion of the problems of the area and of possible measures that the Government and others could take to help remedy the problem. There were especially valuable contributions from my hon. Friends who represent the area, from councillors, from the Medway Ports Authority, the Medway and Gillingham chambers of commerce, the Kent branch of the London chamber of commerce, the Voice of Swale and other local industrialists and trade unionists.

My right hon. Friend was most impressed with the cohesion of views expressed at the meeting and encouraged by the will to succeed. In his concluding remarks he stressed the need for a locally formed coordinating body to act as a steering group to consider the problems of the Medway area as a whole. Such a body could possibly have an outside chairman of accepted industrial and commercial standing to act as a focus, to give leadership and to help achieve co-operation between the local authorities. We well understand the local divergences that naturally exist. That is a matter that my right hon. Friend is still pursuing with the local people concerned.

My right hon. Friend recommended also that there should be a co-ordinating body for the various Government Departments that are involved. I am pleased to say that, for their part, the Government have already set up co-ordinating machinery between the Departments involved. That machinery has already been put into operation. Little progress has been made to date with a local authority co-ordinating body, but I understand that there is now a prospect of everyone getting together and of things beginning to move. I know that my hon. Friends recognise that there is much that they can do to encourage the local bodies concerned to work together.

Those organisations might like to examine the consultation framework that has been established in Hampshire to deal with the problems in the county arising from the defence review. It may be that a structure similar to the one established in Hampshire would be of benefit to the Medway towns.

The Hampshire defence review consultative committee consists of a consultative body on which all local authorities in Hampshire serve together with both sides of industry and appropriate Government Departments. Secondly, there is a steering group composed of local authorities from the areas most closely concerned. Membership is restricted to one representative of each district council and four representatives from the county council, including the minority parties, with officer attendance normally restricted to one from the district councils. County council officer representation also takes place. Thirdly, there is a working group of officers to advise on and implement decisions.

The Government recognise that the needs of the area are substantial. It is important that initiatives should come from the locality. The Government and Whitehall Departments are ready and will be prepared to respond. I hope that the local authorities and the Government are now getting ahead to consider collectively how to tackle the problems.

Suggestions have been made for the use of the Chatham dockyard. Many have come from Kent county council. The Government are determined that it will not be disposed of in any unco-ordinated, piecemeal fashion. As my hon. Friends will know, there are two distinct aspects of the dockyard. In view of the importance of the subject, I hope that I shall be forgiven if I make one or two more remarks about it.

The first distinct aspect is the historic dockyard. That historic area of the dockyard occupies about 29 hectares and contains 150 buildings and structures. The old part of Chatham dockyard is an area of unique and architectural historic interest. Many of the principal buildings of importance occur in groups. For example, there are Brunel's saw mills and the ropery which accommodate activities which have remained substantially unchanged since the eighteenth century. Those buildings contribute not only architecturally to the historic appreciation of the dockyard, but house processes that are in themselves living history. Some, like the Moult loft, have changed their use but have retained a structure of historic interest that any future users should seek to preserve. Some buildings, such as the saw mills, are available for alternative use, provided that their external appearance is preserved.

Many of the buildings are Georgian, and the later Victorian developments under Rennir and Brunel are also Georgian in style. The panel from the Ancient Monuments Board has recognised the potential for commercial and museum use within the yard. It is clear that there are possibilities for developing a cultural, tourist and museum centre in the historic dockyard.

My hon. Friends have talked a great deal about the advantages to the county of tourism and leisure industries. Therefore, there is considerable potential at Chatham in that respect. The dockyard church, which is a light and attractive building, has excellent acoustics and could probably be used for concerts and multi-denominational services.

The second aspect is the main dockyard, which is an extensive area with three dock basins. In that area there is a collection of buildings, including the apprenticeship centre. It is in that main dock area that there is scope for a variety of new uses. Our aim is to make the surplus land and buildings available for disposal as soon as possible. We have made considerable progress in that matter.

Discussions with the local authorities at chief executive level have already been begun by the Property Services Agency on behalf of the Ministry of Defence. Regular meetings to review progress have been arranged. A joint study is being undertaken by the PSA and the county council's district planning officers to see what parts of the dockyard may be suitable for commercial use. It is hoped that the results of that study will be available by Easter and that they will form the basis for constructive discussions by the local authorities, the Ministry of Defence and the PSA.

Twelve firms have expressed interest in taking over facilities when the base closes. There have been a further 11 approaches from consultants and others. The most encouraging approach so far is from a company that is looking at the possibility of taking over facilities for shipbuilding and ship repair work. However, I must emphasise that these are early days and that it is too soon to say whether that or any of the other approaches will later become firm bids.

Hon. Members have stressed the importance of tourism. My hon. Friends will be aware that there is a serious shortage of moorings and storage space in the South-East, which is already threatening the future expansion of the boat building industry. The Ship and Boat Builders National Federation, representing the boat builders and marine operators, has said that it is ready to explore the potential of disused dockyards in the region as sites for marine developments.

Perhaps there is a commercial future for the existing dock basins. The success of the Medway Ports Authority in developing the Sheerness docks in the constituency of my hon. Friend the Member for Faversham in the early 1970s, with its modern cargo-handling facilities, shows what can be done to bring a growth of business activity to the area. I have mentioned those points to show the serious way in which the Government and other public bodies are proceeding on the matter. I assure my hon. Friends that that will continue.

My hon. Friends concentrated on the difficulties of unemployment in their constituencies and the reasons for it. I am talking generally, although later I shall come to the constituencies with above-average unemployment. One must remember that the general unemployment rate in the South-East compares favourably with the rate for Great Britain as a whole. In February, for example, while the seasonally adjusted rate for Great Britain stood at 11.6 per cent., it was 9.2 per cent. in the South-East.

That brings me directly to some of the requests made today. My hon. Friend the Member for Faversham was critical of the policy of steering industry elsewhere rather than calling for assisted area status for parts of Kent, as others of my hon. Friends did. I believe that some of the actions that the Government have taken have certainly helped in that respect. The raising of the thresholds of IDCs, the suspension of the IDC system that I was able to announce in a Friday debate before Christmas and the reduction both in the proportion of assisted areas and in the level of grants have all helped to change the perhaps undue emphasis that existed previously.

I must tell my hon. Friend the Member for Canterbury (Mr. Crouch) that there is no question of directing inward investment to the assisted areas. The grants and advantages that are available are pointed out, but at the end of the day it is always a matter for commercial decision.

I turn to the requests for assisted area status. My hon. Friend the Member for Canterbury certainly hinted at this. I assure him that the Department considers the whole issue regularly, but it has to consider all parts of the country.

I receive deputations all the time. I had two earlier this week. Hon. Members bring deputations from their constituencies, all of whom have special reasons for arguing their cases for special or selective help. It is not done on a regional basis, as the hon. Member for Kingston upon Hull, East suggested. We look at each travel-to-work area. It is natural for those who live in the hardest-hit parts of north Kent to ask whether assisted area status can be extended to them. In November last year, my hon. Friend the Member for Faversham sent to my right hon. Friend the Secretary of State a resolution passed by the Kent county joint committee urging that regional policy should be abolished altogether or that the present system of assisted area status should be revised, because it was felt to be inequitable to Kent, so that some form of temporary assisted area status could be given to those parts of Kent with the greatest employment problems.

Perhaps I may briefly outline the general principles of our approach to this matter. The first and most important point is that, as my hon. Friends know, when we came to office a total area covering 44 per cent. of the working population of this country was designated as one form of assisted area or another. That was clearly absurd. By August this year, we shall have reduced that to 26 per cent. That is important in terms not only of ensuring effective use of national resources, but of concentrating those resources where they are most needed. We remain entirely convinced that this is the only sensible policy to pursue; but the more one responds to every demand for assisted area status, the more one goes in reverse of that policy.

Secondly, I stress that, where there is evidence of permanent structural decline relative to other parts of the country, we are always prepared to introduce new assisted area status for any travel-to-work area. As the House knows, we have been prepared to upgrade very few of the areas worst hit by the closure of steel plants in the past few years, but I emphasise that it has been very few.

Thirdly, unemployment is clearly an important factor, but it is not the only factor to be taken into account in considering this question. A number of other criteria are laid down in the Industry Act 1972. One important criterion, to which we constantly address our minds, is the need to consider whether the level of unemployment in any area at any given time demonstrates a structural decline in the bulk of the traditional industries in that travel-to-work area or whether it is caused by less permanent change—perhaps due to the recession or some other factor. Only where there is evidence that the bulk of the traditional industries face decline is there a clear case.

We must also consider the location of the area in question. I think that it is widely agreed that peripherality—the sheer distance of some regions from resources and markets—is an important component in the regional problem. Indeed, most of the traditional assisted areas are clearly peripheral to wider markets or very far from the main centres of economic activity. I doubt whether in general that would apply to Kent.

We must pay attention to the dangers of introducing unfair competition to individual industries or firms if we extend the assisted areas more widely. That is where most of the concentration exists and there should be a fair share of it for all non-assisted areas. There is also the important point which I sometimes call the ripple effect but which my hon. Friend the Member for Maidstone calls the knock-on effect. In other words, the moment that we say that we will consider making an area with admittedly serious unemployment problems and an above-average level of inflation an assisted area, we must immediately consider the many other travel-to-work areas in Britain with similar problems. That knock-on effect quickly leads one back to a situation where one is not concentrating aid on the areas of greatest need. Those factors must be considered.

I fully accept that parts of north Kent have particularly high unemployment levels in historical terms. However, there are other non-assisted areas without some of the advantages of Kent with higher unemployment. Kent obviously has the advantage of location. Communications, despite the comments made by my hon. Friends, are continuously improving. Therefore, I must ask myself whether north Kent or the Medway towns suffer problems on the same scale as areas which are presently given assisted area status.

I appreciate the worries expressed by my hon. Friend the Member for Gillingham. We will deal with those problems. In relation to all the other representations I received, I do not think that a case has been made out.

The underlying buoyancy of the economy is an important factor, and it is interesting that, although the numbers of unemployed people in the Chatham area are presently very high, more than 11,000 new jobs were found by the jobcentre in Chatham last year—an indication of perhaps slightly greater buoyancy than one discovers in other areas.

On all those grounds, there are difficulties about accepting the case for assisted area status today, and I note that a number of my hon. Friends have not pressed that case. We continue to consider regularly all parts of Britain and the evidence of long-term structural decline relative to other parts of the country, and we shall certainly continue to do that in the constituencies concerned today.

My hon. Friend the Member for Faversham also asked for encouragement of industrial investment in his area. I shall spend a moment on that aspect because I accept the gist of his remarks. He will recognise that a major way by which industrial investment is encouraged in Britain is through capital allowances.

When considering the sums of money spent on regional development grants, we often forget that the sums available in terms of tax benefits and through capital allowances are much greater than those under regional policy. Although I have not had time to check the figures, I believe that last year's figure was about £6.8 billion. Therefore, the encouragement through capital allowances represents a significant figure which, of course, applies to the whole of the South-East.

Government assistance, particularly in the areas which everyone recognises are so important, such as high technology, is available in Kent and the South-East. Under section 8 of the Industry Act 1972, since the Government came to power, selective financial assistance in the South-East amounting to £23.5 million for 1,082 projects and, in Kent alone, to £4 million for more than 30 projects has been offered. Under the microprocessor application project programme, in the South-East as a whole £19 million in assistance has been offered since the Government came to power. Under the product and process development scheme, the South-East has had a high proportion, which again indicates the buoyancy of the economy and the large number of up-to-date, thrusting companies in the area. About £41 million has been offered since we came to power under the PPDS.

My hon. and learned Friend the Member for Thanet, East (Mr. Aitken) referred to the loan guarantee scheme and, again, the South-East reflects the liveliness of small businesses and those wishing to start businesses who have taken considerable advantage of it. To the end of last month, 875 loans were made, which would not otherwise have been given to small businesses, totalling over £32 million.

I shall also deal with other aspects of Government activity and expenditure through which Kent and the South-East will benefit. Thirty information technology centres have been announced so far and they are being expanded; proposals for a further 70 centres throughout the country are being examined. I urge that the Kent area considers the possibility of advancing proposals for that area which we will certainly recognise.

Many of my hon. Friends have referred to the measures of the Manpower Services Commission. There has been considerable take-up throughout Kent and the South-East for the youth opportunities programme and many of the other measures that the commission operates on behalf of the Government. There has been a substantial response to the youth opportunities programme in the South-East in the last four years. It had the highest proportionate increase in entrants of all regions in 1980–81 compared with the previous year.

Much has been done in the provision of training schemes and matters of that sort with which I do not have time to deal. There are, however, two that are of great importance to the area. Reference has been made to the young workers' scheme that began in January. I agree about the importance of better publicity. I have tried to give the scheme publicity wherever I go. In the South-East region, the Department of Employment had received over 5,300 applications by the end of February and had approved nearly 3,000 of them. That is an encouraging start. I hope that my hon. Friends will continue to give publicity to the scheme.

I announced the enterprise allowance scheme in another Friday debate. I was particularly anxious that the Medway towns should be chosen as one of the three pilot areas because of the need to encourage the growth of new businesses and to help people made redundant who find difficulty in becoming self-employed. In the Medway area, 60 applications had been received up to 26 February. Of these, 24 have so far been approved. I believe that there is much more scope for take-up in the Medway towns. I hope that my hon. Friends will do all that they can to help. The more publicity the scheme attracts and the greater the take-up, the more we are enabled to decide how to extend it further on the basis of a fair experiment.

I understand the concern that has been expressed about transport. I have the same problems in the part of the country that I represent. In local road spending, the Department of Transport has now accepted 92 per cent. of the Kent bid for 1982–83. This was the tenth highest rate of acceptance among shire counties. All the Kent bid for current spending and 79 per cent. of capital spending was accepted.

Mr. W. R. Rees-Davies

It is long overdue.

Mr. MacGregor

It may be long overdue. I accept the point. I feel the same in relation to my own county. Now that the bulk of spending on trunk roads in less prosperous regions in completed, I believe increasingly that we are now getting a fair share of that expenditure. The capital spending agreed in Kent is the highest for any share county. On a per capita basis, Kent ranks twenty-fourth. It is, therefore, clear that Kent has come out well this year.

My hon. Friend the Member for Maidstone (Mr. Wells) drew attention to the A20 through Sidcup. I am pleased to confirm that the Department of Transport is well advanced with the planning for the Sidcup bypass which will solve many of the problems to which my hon. Friend referred. The Department of Transport has completed the planning procedures laid down in the Highways Act and the advance work should begin later this year. Time does not allow me to cover other aspects of the communications problems. I assure my hon. Friends that all their comments will be passed to my right hon. Friend.

I turn now to the importance of small businesses to which the motion refers. This is especially important for the South-East. Some other parts of the country from which I receive deputations have a problem in that they do not have a long tradition of self-employed people. They have relied on heavy, basic traditional industries. There is no tradition of small firms. The take-up of much of what we are trying to do in the small firms area is much more difficult to achieve in those areas than in the South-East. I have addressed a large number of small business meetings in the South-East, including five in Kent, in the last year. I am aware of the tremendous interest that has been shown in the measures introduced by the Government. I am grateful for the kind remarks of my hon. Friends in that respect.

We shall continue to carry on with that programme. If time had been available, I would have liked to say more about local initiatives, including SWIM and "Voice", in Kent. Last week, I chaired a conference of all the organisations undertaking local initiatives in London and the South-East including local entreprise agencies where large firms are helping small firms. I was impressed by the range and number of them and the fact that many had only started within the past six months. There is tremendous potential. "Voice" is doing a great deal. I shall be watching with interest the progress of SWIM and other efforts.

A point that frequently arises at my meetings in the area with small businesses is concern about the lack of willingness of local authorities to be constructive over planning permission and lack of small business premises. I know from figures I have seen that there are plenty of industrial premises available covering large areas but there is still much to be done in relation to small units. I hope that more entrepreneurs in the area will take advantage of the 100 per cent. industrial buildings allowance. If my hon. Friend the Member for Maidstone writes to me about imports of tissue from Spain, I shall respond.

Inevitably, in such a wide-ranging debate, I have been unable to cover everything. The main theme of the debate has covered small companies, self-help through local authorities and enterprise agencies. Hon. Members have discussed the need not to make excessive demands on Government, but to ensure that Government expenditure is effectively and well spent. They were the hallmarks of today's debate—

It being half-past Two o'clock, the debate stood adjourned.

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