HC Deb 22 March 1983 vol 39 cc726-72 3.40 pm
Mr. Albert Booth (Barrow-in-Furness)

I beg to move, That this House, being opposed to the reduction in capacity of British Rail Engineering Limited which would arise from the proposed closure of Shildon, Horwich and Temple Mills railway workshops, is concerned at the devastating unemployment which would result; and therefore calls upon the Government to reject entirely the Serpell strategy for British Rail Engineering Limited and to develop a comprehensive programme for the modernisation and expansion of freight and passenger services.

Mr. Speaker

I have selected the amendment in the name of the Prime Minister.

Mr. Booth

The Government are running down British Rail by starving it of the investment needed for rolling stock, signalling and electrification. The investment expenditure of British Rail has fallen from £513 million a year in 1979 to £333 million a year in 1981. Therefore, it is not surprising that British Rail orders for British Rail workshops have slumped. The slump can be seen in practically every part of the new build work in British Rail's workshops.

The number of new high-speed train locos ordered fell from 27 in 1979 to 15 in 1982. The number of high-speed train coaches ordered fell from 125 to 45 in the same period. The number of other coaches ordered fell from 221 to 97, and the number of freight wagons fell from 2.269 in 1979 to 1,140 in 1982. What is more serious for the workshops in general, and for Shildon in particular, is the projected further rundown that British Rail and British Rail Engineering Ltd. are planning.

Last week I was told that the rundown of freight wagons will continue until it reaches a level as low as 200 or 300 a year over the next two years. That is why British Rail Engineering Ltd. is proposing to close Shildon, Horwich, apart from the foundry, and Temple Mills.

This is a clear responsibility of the Government. The Secretary of State is all too fond of telling us that these decisions are for British Rail. Today, let us have some realism in the debate, and let us face up to the fact that it is the Government and not British Rail who have refused to approve the major investment proposals of the board. It is the Government and not the British Railways Board who have set an investment ceiling and then set an external financing limit that makes it impossible to attain that ceiling. It was the Government and Conservative Members who carried the legislation through the House that has ensured that British Rail's profitable subsidiaries will be sold off and it will no longer be able to co-operate in maintaining the investment programme. By their commissioning of the Serpell report and their attitude to the report, the Government have confirmed their anti-rail bias that has led us to this appalling decline in the prospects for British Rail.

The spectre of unemployment now haunts the railway workshop towns. Unhappily, the three main workshops that are the cause of today's debate are all in areas that already suffer from high unemployment. In particular, the Horwich workshop, which is in the constituency of my hon. Friend the Member for Westhoughton (Mr. Stott), who will wind up the debate for the Opposition, is in the Wigan travel-to-work area which already has 19.3 per cent. unemployment. Almost one in five is out of work.

The Shildon workshop is in the Darlington and southwest Durham travel-to-work area which already has 15.2 per cent. unemployment. What is more, that workshop is in the Bishop Auckland labour exchange area, where unemployment has already reached 19.5 per cent. On some estimates that I have been given, the prospect is that unemployment in Shildon would reach 50 per cent. if the workshop closed.

We are talking only of the immediate effect in the workshop towns. Hon. Members should not forget the knock-on effect of closing workshops, which is considerable. In new build it is estimated that about 60 per cent. of the work is brought in from private industry. So for every job destroyed in the new build section of British Rail workshops there will be a job and a half destroyed in the private sector.

The unemployment that the Government will undoubtedly cause if they continue to pursue their policy is a tragedy not only for the workers in those workshops and the local communities but for the country as a whole. If one takes the Treasury estimate of the cost to the nation being some £5,000 a year per worker for every year of unemployment, these closures will cost the nation £2.2 million a year. One wonders what economic theory justifies creating social tragedy at public expense in the way that these workshop closures inevitably will.

It is a particularly poor reward for the workers of Shildon, who have co-operated to the hilt with management in developing Shildon as one of the finest freight wagon building works in the world. When I went to the workshops and talked to the craftsmen and stewards, it was clear that there had been the highest degree of cooperation to make possible that fine, highly productive, profitable capacity. If the workers ever believed the Prime Minister when she suggested that the way to guarantee job security was to co-operate with management, never have a strike and make the workplace productive and profitable, they have learnt a bitter lesson and will never trust such propositions from the management again. The workers were told when they engaged in the exercise of cooperation that it was inconceivable that there would ever be a time when the capacity at Shildon would not be required by British Rail. Now, a few years later, they are told that all the capacity for new build is surplus to requirements.

When I think of the times that we have listened to Conservative Members publicising with delight those rare examples of disputes on British Rail delaying progress towards higher productivity, I wonder why they were so silent about the excellent example of worker co-operation creating this valuable capacity for our country. These people have been led into believing that they were making efforts that were not only in their interests but in the interests of the local community, and in the interests of a promising future for British Rail. They are now seeing that promise turned into a prospect of the most appalling decline.

The area of decline which is of the greatest importance to Shildon is in freight services. After 30 years of decline in its freight services, British Rail planned a massive comeback for the 1980s. In the preceding 30 years, the railways' share of the combined road and rail freight movement went down from more than half to a stage where lorries were carrying five times as much as trains. That was the measure of the decline. British Rail planned enormous expansion of modern freight services in the 1980s. I have here the beautiful glossy brochure in which British Rail announced how it would expand Speedlink. It said: There are firm plans for continuing expansion to provide an even better range of services to meet the needs of the '80s. This is the publication in which British Rail talked of the big traffic switch to Speedlink". Ironically the part which refers to tailor-made wagons now reads: So extensive and specialised are the transport needs of industry today that even British Rail's large fleet of freight wagons cannot meet every requirement. Here we are, just a few years later, debating the closure of the finest freight wagon building capacity in this country and probably in Europe.

The planned expansion is forgotten. British Rail is getting out of wagonload traffic as fast as it can, apart from what remains of the Speedlink network. British Rail's tonnage of freight carried has fallen from 22.8 thousand million to 12.2 thousand million. Of course, we know that part of the fall has been due to the slump in heavy industries. But if we run down our capacity to the needs of the bottom of a slump, what prospect is there for growth when we have an economic recovery? Labour policy is to stop the decline and to increase freight services. British Rail's planned expansion of the Speedlink network must take place and the investment for that must be provided.

Between 1970 and 1981 wagonload freight fell from 93 million tonnes to 17 million. At every factory which I visit I am told that it does not want to provide the storage for the amount of raw materials that would come in a trainload and then run the materials down until another trainload is due in a week or a fortnight. A factory wants the materials delivered as soon as it is ready to use them. When production is completed, the factory wants the goods carried straight to its customers. The wagonload facility is the modern need of industry. Unless that facility is developed through Speedlink, there will be an increasing decline in the proportion of freight carried on the railway system. That decline must be stopped.

Speedlink, the pride of the expansion programme of British Rail, is carrying only 2 per cent. of British Rail's freight tonnage. That was where its glorious future was supposed to lie. The lack of money for British Rail to invest in specialised freight wagons has resulted in a fair proportion of the work being transferred to other sectors, particularly the building of specialised freight wagons. Because BR has had to tell potential customers that it cannot provide freight wagons, arrangements have had to be made for them to be obtained from other sources.

Public money has been used to ensure that the wagons have come from other sources. The Government have handed out £5.1 million in section 8 grants to private firms to buy wagons from private suppliers. One wonders what those firms will think when they consider the Serpell report. Will they still have rail connections on which to run the wagons? Not only has £5.1 million of public money been handed out to private owners to buy wagons, but banks and finance houses have been told by the Treasury that they can offset money provided for this sort of construction in the private sector against corporation tax on a lease-back basis. So public money is being used on an appreciable scale to ensure that wagons will be built by private manufacturers for private ownership to be run on British Rail's services. As a consequence, more than 80 per cent. of the wagons have been built in private workshops.

Are we surprised that we are now debating a cutback of British Rail's engineering capacity? If British Rail was allowed to compete fairly, there is little doubt that Shildon would have plenty of orders. However, British Rail is handicapped by a Government who have a doctrinaire attachment to handicapping nationalised industry while aiding the private sector.

The development of Speedlink, which needs to be brought about quickly, will increase the need for special wagons and therefore put the Shildon workshop at a further disadvantage. In the past Shildon has competed successfully in the making of specialised wagons. It has built them profitably and, if allowed, could do so again. Unless we can expand modern rail freight services such as Freightliners and Speedlink and give the customer the opportunity to hire a freight wagon to carry his product as easily as he can hire a lorry, there is little prospect of getting a sensible balance of freight movement between rail and road.

On the passenger side, there is a dearth of work in the building of passenger locos and passenger coaches, although clapped-out rolling stock is being used to try to maintain services. Many of the electric and diesel multiple units on the feeder services, which are the backbone of the commuter services, should have been replaced years ago. It is a tribute to railway workshops that they can keep them running at all. Over 66 per cent. of the electric and diesel multiple units are between 20 and 30 years old and were built to a design which was intended to have a specialised life of about 10 years.

The closure of railway workshops is only the forerunner of service cutbacks. We know it in the north-west where we have been informed by British Rail that sleeper services will be withdrawn because it cannot afford to replace the sleeper coaches or even have them refurbished. That work would have gone to a British Rail workshop. That shows the link between the closure of workshops and the cutback in services.

Mr. Bob Cryer (Keighley)

Does my right hon. Friend accept that, because of the marked decline in and current slow production of high-speed trains, HSTs are often doing 1,000 miles a day and are doing so much work that they are not maintaining the high standards of reliability that they achieved when they were introduced? The demand is for more HSTs so that the existing ones may have a slacker schedule.

Mr. Booth

My hon. Friend has raised an important point in connection with the workshop programme. Not only has the new build been cut back, but so have the overhaul and refurbishment programmes. The British Railways Board—some of its members must be capable of doing double-backward somersaults, because they signed a document at the beginning of 1981 which said that they could not continue with the present level of investment without a rundown, and some of them are still serving as members, in spite of the lower investment now—said that if the investment programme were maintained at the then level the availability of main line locos over a decade would fall to 50 per cent. Who can run a railway with only 50 per cent. availability of main line locos? Incidentally, the board also predicted that it would have to take about 2,000 track miles out of use and put another 800 miles under speed restrictions. That was at the then level of investment, which has been cut since that time.

Mr. Ron Lewis (Carlisle)

Does my right hon. Friend agree that the locos now running on British Railways are not being adequately serviced, in that they are continually in use?

Mr. Booth

It is clear that on certain services it is impossible to maintain a scheduled service with the existing locos, given that they were subject to the normal maintenance cycle. That has meant in some cases that the services are provided by locos which were not designed for that service, and in other cases that locos are run for longer periods. However, the Serpell recommendation is that too much is being spent on maintenance and that experiments should be conducted to see whether maintenance standards can be lowered. What Serpell is saying today is what the Government are thinking now and what the Government would say tomorrow if they get another electoral endorsement—highly unlikely, I admit, but it is a possibility that we must take seriously.

We are seeing the tip of the iceberg, with the closure of the workshops. It will lead to closure of services, and subsequently to the closure of the railway network. I believe, therefore, that the Serpell approach to British Rail Engineering should be rejected by this House, as it was rejected by the British Railways Board. In the rest of the world, railways are being developed. This country is being left behind in that development. British Railways is meeting more of its costs from revenue than almost any other railway system and, as a result, the price of using British Railways makes it the most expensive railway system in Europe. Our investment in railways is the lowest in Europe.

The Labour party's policy is to invest in electrification and in the development of modern freight services. In doing so, we believe that we shall not only improve our transport system but make a sensible and valuable contribution to the regeneration of our country's economy. If the Government continue with their present financial policies, Shildon, Horwich and Temple Mills are only the start, and the replacement programme that will be left will not be sufficient to fill the remaining workshops. Then there will be even more closure proposals.

The Government are master-minding a double tragedy. They are killing the industry which we shall need to modernise our transport system, and simultaneously they are dashing the hopes of those who, by their labour and co-operation with the railway management, have developed a superb railway manufacturing and maintenance capacity. Their reward from the Tory Government for doing that is to have the misery of unemployment visited upon them.

I therefore call on the House to support our motion and to reject the Government's amendment.

4.3 pm

The Secretary of State for Transport (Mr. David Howell)

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof: recognises the need for British Rail Engineering Limited to rationalise its workshop capacity in the light of changed requirements; and supports vigorous and constructive measures by all concerned to promote alternative and durable employment in the areas affected. It is many years since this House has had an opportunity to discuss railway workshops, now in the form of British Rail Engineering Ltd., in prime time—so to speak—although, of course, there have been a number of Adjournment debates over the years, arising out of particular closure decisions. I do not resent or regret the opportunity to discuss the railway workshops and the developments that have given rise to the Opposition motion.

First, it is ironical that, as the right hon. Member for Barrow-in-Furness (Mr. Booth) well knows—he is very familiar with the investment programme and the freight building capacity at Shildon—the outcome and prospect of closure at Shildon arises not from low investment but from a massive programme of high investment in the new, air-braked freight wagons to which he referred. Moreover, it is British Rail policy, as the right hon. Gentleman again well knows, to build up to a level of 22,000 air-braked freight wagons. That has now been achieved. It is also BR's policy to move away from the old vacuum-braked wagons.

The present number of wagons will fall considerably. The right hon. Gentleman knows, as do all right hon. and hon. Members who are familiar with railway equipment and supply, that these new air-braked wagons have double the capacity, carry 29 tonnes, have vastly greater utilisation and higher speeds, and can be run at 75 mph over the track, instead of 45 mph, and that the demand for railway wagons has dropped to a minimum level as a result of the high investment in railway wagons.

Mr. Peter Snape (West Bromwich, East)

Will the Secretary of State say what difference will be made to rail freight carriage by his recent agreement to 38-tonne heavy goods vehicles on our roads?

Mr. Howell

I believe that it will be very small, but we are talking about closures that result from British Rail's present needs and the present assessment of BR's need for freight wagons in the future. British Rail tells me that it will need probably not even as much as 150 wagons a year over the next three years, and perhaps rather more after that. Shildon's capacity is 1,500 new freight wagons a year. As I said, the new wagons have twice the capacity of the old ones. They can be utilised four times as much by better handling and better computer control of wagon movements. So, on that score alone, demand for railway freight wagons has dropped by up to one-eighth of what it was. The right hon. Gentleman and his hon. Friends may say—I would join them—that that clearly creates a major change in the market for freight wagons. Of course, it does, but it is a technological change resulting from higher investment. The closures that are now being discussed at Shildon and Horwich result from a higher investment programme. There was no recognition of that fact in the right hon. Gentleman's emotional comments.

I am the first to recognise, and I agree strongly with those who say it, that the men at Shildon have superb skills. They can make any type of wagon, and they have done so. The finish and the accuracy are excellent. Nevertheless, the wagons are simply not needed on the scale of Shildon's capacity.

The right hon. Gentleman spoke about specialist wagons. I do not recall whether he said anything about exports, but I should like to say a word on that subject. When the pattern of British Rail's needs began to unfold, with its greater reliance on freight wagons and the decline in its demand for the type of wagons that Shildon provided, I looked, as did British Rail and British Rail Engineering, at the possibility of new markets overseas. In one case, the Government helped to secure an order. Here again, the size of the orders—for instance, the order from the Congo for 115 wagons—does not begin to match the large capacity at Shildon, which is a single-purpose works, was developed as such, and now has a capacity far in excess of anything that British Rail will need.

The truth is that the decision to reduce the whole United Kingdom wagon-building capacity has become inevitable. The right hon. Gentleman knows that perfectly well. He also knows—and if he does not, he should now acknowledge it—that if BREL does not streamline and rationalise itself it will put the whole British Rail engineering business at risk. Why? Because it vastly increases the overheads. It is estimated that to keep Shildon open and maintain the Horwich repair works will increase the overheads on British Rail engineering by £20 million.

We are moving into a world where it will be absolutely essential for British Rail Engineering to compete in export markets and in the sort of areas to which the right hon. Gentleman has referred, including specialist wagons and other rolling stock. I do not see how he can argue at the same time that a business that will have to compete to secure the orders we all want to see should retain round its neck this millstone of an additional £20 million a year of overheads.

Imagine what would happen if we were to follow the advice which is not, admittedly, in the Labour motion but is in the amendment tabled by the Social Democratic Party, to the effect that Shildon be kept open. One effect would be that the repair work which, at present, BREL tells me, it wants to centralise and concentrate at Doncaster would not go there. Doncaster would have to keep the locomotive work, which, on BREL's present plans, ought to go to Crewe. The unemployment would therefore occur at Crewe.

Unemployment cannot be avoided in the conditions that I have described of completely different market requirements. Unemployment is bound to come. Does the right hon. Gentleman just want it to be pushed from one area to another, or does he want to see a serious attempt made to put BREL into competitive shape for the future? If he wants the latter, he should adopt a ra0074her different approach from the one that he seems to be taking and that the right hon. Member for Ebbw Vale (Mr. Foot) seemed to take when he visited Shildon, which was that, somehow, Shildon works could be kept open even if there were no demand for the freight wagons.

Mr. Mike Thomas (Newcastle upon Tyne, East)

If the right hon. Gentleman takes the view he does, why did he and his officials twist the arm of British Rail to make the proposal it did on 9 March to do exactly what we propose— mothball the main works, keep some men on wagon repair and breaking up wagons at Shildon after 1984 and review the position after two years?

Mr. Howell

Neither I nor my officials twisted British Rail's arm at any point. This is a decision that has been left to British Rail and BREL, to handle the whole question of rationalising British Rail's engineering capacity throughout the country. There is no question of ministerial or official arm-twisting in the matter.

The hon. Member for Newcastle upon Tyne, East (Mr. Thomas) and his right hon. Friend the Member for Stockton (Mr. Rodgers) have said that they would keep the Shildon works open. I believe the latter would keep the works open as part of a commitment to his party's reflationary programme. That seems to be the position of the Social Democratic party.

Mr. Mike Thomas


Mr. Howell

I want to turn in a moment to the kind of damage that I believe that kind of political opportunism does to the future capacity of British Rail Engineering and to the people of Shildon but I will let the hon. Gentleman intervene once again and for the last time.

Mr. Thomas

I think the Minister will understand why I want to pursue this point. If it is the case that he and his officials did not twist British Rail's arm to make this offer, why does British Rail tell me that it wishes to close the Shildon works and does not wish to pursue the course of action proposed here?

Mr. Dennis Skinner (Bolsover)

And if the right hon. Gentleman cannot tell him, ask Tony Cook.

Mr. Howell

I do not think I have ever before agreed with a sedentary intervention by the hon. Member for Bolsover (Mr. Skinner) but this afternoon I shall make history by doing so.

The hon. Member for Newcastle upon Tyne, East is ascribing to me responsibility for events that did not occur and to British Rail an attitude that it has not taken. Two sets of politicians have cast doubt and confusion on the situation, some belonging to the party of the hon. Member for Newcastle upon Tyne, East and the others to the party of the right hon. Member for Barrow-in-Furness. Before I turn to some of the damage they have done in getting in the way of job creation and constructive approach to these problems that I believe to be necessary, I shall return to the main theme of my speech. I was asking the right hon. Member for Barrow-in-Furness whether he was aware that if Shildon were to be kept open there would be difficulties elsewhere in British Rail's engineering capacity and that, in particular, there would be a possibility of unemployment at Crewe, and whether that was what he wanted.

Perhaps I can say a word about the private wagon builders to whom the right hon. Gentleman also referred. If BREL keeps open uneconomic works, because of the great contraction in the wagon freight market—and we are not just talking about the home market—other works would have to fold. There are private wagon works throughout this country, at Wakefield, Cardiff, Gloucester, Stafford, Birmingham, Wigan, Heywood and elsewhere. Why did the right hon. Gentleman take a view that seemed to imply that he really did not care about the workers in those wagon works? Their interests and their future are just as much involved. If British Rail maintains uneconomic capacity with substantial overheads that it cannot possibly fill with future orders, the backlash falls on the works in the private sector. I would take the protests and promises of Members on the Opposition Benches much more seriously if we heard an occasional word of support for the workpeople in the private sector of the industry.

Mr. Richard Needham (Chippenham)

May I help my right hon. Friend? It is quite obvious why Opposition Members are not talking about the private factories involved. It is because there does not happen to be a by-election in any of the areas where these factories are situated.

Mr. Howell

As I began by saying, it is very many years since Opposition Members have felt moved to bring this subject to the Floor of the House of Commons on a Supply day. One must query their motives in raising this issue at this time in this way.

Mr. Booth

Will the Minister just recall for a moment that I did talk about the effects of the cutback on the private workshops and that I said that, as far as new building investment was concerned, the cutback would probably destroy one and a half times as many jobs in the private sector as in British Rail workshops? Will he therefore acknowledge that I did talk about the effect on the private sector and will he tell us why he has made no reference to the massive reduction of investment and its effect on British Rail's workshops work? Does he contend that had he maintained the investment level inherited from the last Government there would have been anything like the present crisis in the workshops?

Mr. Howell

The reason why I have not dealt with the second point is that I have not yet come to the figures for investment, but I can say now that many of the right hon. Member's propositions are wholly misleading and not founded on fact. There is a much more constructive approach to the need for BREL to rationalise its capacity than has been taken by either him and his right hon. and hon. Friends or Members from the other political parties represented on the Opposition Benches. That more constructive approach is exemplified, for instance, by the attitude of the local district council at Shildon, which has indicated that a positive and co-ordinated effort is now required to create new jobs and to meet the problems thrown up by the prospective closure of Shildon. The Sedgefield district council will be centrally involved, as will the regional offices of the Department of Industry and the Department of the Environment and the Manpower Services Commission and BREL itself. All Government agencies which can help will be working with BREL and others locally to stimulate new jobs.

It will be difficult. There can be no naivety of the kind shown by some hon. Members when they visited Shildon about waving a magic wand and pronouncing that jobs will be re-created. It will be difficult, but I believe that the opportunities exist, especially now that we are unwinding the Labour party's tax on jobs and creating unparalleled new work incentives, as my right hon. and learned Friend the Chancellor of the Exchequer announced in his Budget. BREL has nominated a director specifically to help with this task. It is also prepared to provide financial resources. Work of the right kind is taking place to provide jobs and enterprises to replace the jobs that are bound to disappear because of lack of demand.

Mr. Ted Leadbitter (Hartlepool)


Mr. Howell

I should like to make one more point before giving way to the hon. Gentleman. I have to say to the right hon. Member for Barrow-in-Furness, to his right hon. Friend the Leader of the Opposition, sitting beside him, and to the hon. Member for Newcastle upon Tyne, East, who speaks for the Social Democrats, that when they or their representatives went as political visitors to Shildon and gave the impression that there is an alternative to closure, what they did—this will be the case so long as they go on doing it—was to ensure further delay and a prolongation of the time in which people will continue to resist and not adopt a constructive response to the unemployment position. So long as people go on feeling that closure can somehow be avoided, there will be difficulty in getting a constructive response.

By far the best service that they, or their political representatives or candidates, could render would be to adopt the view that I have stated in the last few minutes. By working together, the local authorities, British Rail Engineering, the agencies of the Government, the local community, enterprise trusts and other bodies can make a real start in providing jobs and work for the future. If right hon. and hon. Gentlemen intend to continue raising totally false expectations and giving promises that cannot be fulfilled, all they are doing is prolonging the difficulty and delaying the day when we can get started on a decent job programme in the area.

Mr. Leadbitter

The Secretary of State is in cloud-cuckoo-land. He talks nonsense. Is he not aware that he does not have to initiate the co-operation between all these authorities in the northern region? We are experts at it. Our experience is that the promise that the Secretary of State makes about new jobs is not fulfilled. The result of working on the principle that he has espoused is that, in Hartlepool, unemployment has continued to increase. One man in three is out of work. Why does not the right hon. Gentleman stop talking such utter rubbish?

Mr. Howell

I recognise the hon. Gentleman's deep feeling over high unemployment in Hartlepool—

Mr. Leadbitter

The right hon. Gentleman has no feeling.

Mr. Howell

—but we are not talking about that. We are discussing the problems at Shildon. I have made clear that the closure results from high investment. The need is to find new jobs and to create new businesses in the area. I believe that this can be done, but not while totally false expectations are raised for short-term purposes and apparently to buy votes in a way that passes all standards of normal political opportunism, even though we see plenty of it in this House.

Mr. Mike Thomas

Does the statement made at the shopmen's national council meeting on 9 March represent that kind of opportunism?

Mr. Howell

I do not know the statement to which the hon. Gentleman keeps referring. If it relates to the claim that British Rail had its arm twisted by Ministers and officials, it is totally untrue and without foundation.

The right hon. Member for Barrow-in-Furness has asserted that the problem stems from lack of investment and financial support. I should like to deal with the facts relating to investment and financial support. I take the two sets of years, 1975 to 1979, when the right hon. Gentleman had some responsibility, versus 1979 to 1983. The facts fly directly in the face of everything that the right hon. Gentleman stated. They are perhaps worth repeating slowly and clearly. During the period 1979–83, grant support to British Rail from the Government was double, in cash terms, the sum provided from 1975–79. The amount was £2,600 million against £1,300 million. Obviously, expressed in constant money terms, it is not double. However, it is still significantly larger.

Under this Government, substantially more social grant has gone to British Rail in the same period than during the four years under the Labour Government. That is a fact. It needs to be repeated clearly. Again and again, the right hon. Member for Barrow-in-Furness and his right hon. and hon. Friends ignore that fact, which does no service to British Rail. They make assertions about international comparisons that appear not to be right. Incidentally, the right hon. Gentleman is, I believe, wrong about the Bundesbahn. There is evidence that it gives a smaller amount of support in relation to total revenue than we do. That is confirmed by recent figures that appeared in the Financial Times. As the right hon. Gentleman knows, it is difficult to obtain the actual figures from the Governments concerned.

Mr. Les Huckfield (Nuneaton)


Mr. Howell

I have given way so often that I think I shall now push ahead and complete my speech. The figure for social support through the public service obligation is £2,600 million over the four years versus £1,300 million over the previous four years. I hope that the right hon. Gentleman will accept that figure. It is fact.

I come now to the investment figure. The right hon. Gentleman and his Opposition colleagues have made great play of the consequences of the fall-off in the level of investment. I have explained, in relation to Shildon, that it is not the fall-off in the level of investment but the maintenance of a high level of investment in air-braked freight wagons that has led to the fact that the Shildon capacity cannot be used. I shall give the right hon. Gentleman the overall figures. In the four years between 1975 and 1979, investment in British Rail was £1,100 million—in fact, slightly over at £1,114 million. In the four years 1979–83, it has been £1,600 million, a considerably larger sum.

If the right hon. Gentleman asks for those amounts to be expressed in constant money, I shall do so. It is certainly correct that, in constant money terms, the figure of £1,600 million represents a lower sum than the figure of £1,100 million. [Interruption.] Not by very much, but it does. If the right hon. Gentleman asks why investment is down, I think that even as he asks the question he knows the answer. He knows that last year, as a result of the ASLEF dispute, £170 million was bled out of the system during the summer that could have gone into investment. Labour's Front Bench Members are the last people on earth to be lecturing the Government in complaining about lack of investment in British Rail.

Mr. Les Huckfield


Mr. Howell

No, I shall not give way. Mr. Huckfield: Let us have real figures.

Mr. Howell

When that money was bleeding out of the system, they were actively inflaming the situation. We do not want lessons from them on the kind of investment that they think should go into British Rail.

It is true that, since I last spoke in the House on British Rail matters, ASLEF has agreed to operate the Bedford to St. Pancras electric passenger line. That is welcome although many members of the travelling public will, I am sure, say "About time, too". We shall not take lessons from the Labour party on how to support our railway. If its example of support for rail services is of the kind given last summer, it is no help at all. It is the kind of support that they could do without.

The situation at Shildon arises not from lack of investment but from the consequences of investment. That needs to be stated again. I make no apology for repeating it. The right hon. Member for Barrow-in-Furness could not bring himself to state what he knows to be the facts. The transition is, of course, painful. The workpeople affected deserve, and are fully entitled to, every conceivable effort to help them and their families and their communities. The Opposition motion does none of that. By purveying the idea that Shildon can somehow be kept open, the motion is pure escapism and pure opportunism. The same applies to the amendment of the Social Democrats. Neither will help British Rail Engineering in the slightest degree to procure more jobs or more orders. Neither will help with finding and creating more jobs in the areas concerned. I suspect that neither will help towards achieving the aim that I imagine lies behind them, that is, promoting the Labour and SDP candidates at Darlington. Indeed, as far as I can make out the Labour candidate is busy trying to disengage himself as fast as he can from the policies and views of the Left wing in control of the Opposition Front Bench.

For these reasons, I can see nothing in the Opposition motion that would bring any help to the people concerned or the workers concerned in these closures. No one gets any joy from seeing these closures. They arise from the high investment in air-braked freight wagons. It would have been far better for British Rail Engineering and the future of the railway system if the motion and amendment had never been put forward and it would be far better now if they were withdrawn.

4.31 pm
Mr. Derek Foster (Bishop Auckland)

There will be deep resentment in my area at the Secretary of State's suggestion that there has not been a constructive response to this proposal. The district council, the town council and the county council—all Labour-controlled—and I have worked unceasingly for the past 12 months to develop a constructive response to this closure, and I hope that the right hon. Gentleman will recognise that.

The Prime Minister and the Government ceaselessly extol the virtues of what they call the old values, by which I take them to mean thrift, hard work, sturdy independence, self-reliance, family life, the sense of community and pride in the community. That describes almost completely the community of the township of Shildon of some 14,000 people. Those are values which we, too, respect. But how can a man stand on his own two feet and be self-reliant when he has not got a job? If the Prime Minister and the Government really want to preserve those values, if they really mean what they say and this is not just empty rhetoric, they should do something to save the community of Shildon. But they stand idly by and do nothing while Shildon is threatened with long-term unemployment, poverty, the destruction of the whole community and the break-up of family life. They make great play of being the party of the family, but long-term unemployment and poverty have done more than anything else to break up family life in this country.

Sir Frederick Burden (Gillingham)

Will the hon. Gentleman give way?

Mr. Foster

Not at the moment.

The work force at Shildon is a most valuable asset, first, because of its engineering skills, which are acknowledged by everyone, and, secondly, because people have devoted the whole of their lives to the rail works there. Indeed, sometimes as many as three or four generations are involved. Railway production has been going on at Shildon for over 150 years. It is a valuable asset because of the workers' pride in their product and their commitment to the rail works. It is a valuable asset, too, because, as my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) said, the workers have been cooperative, adaptable and flexible—everything that the Government say they ought to be.

Sir Frederick Burden


Mr. Foster

No, I shall not give give way. Many hon. Members want to speak in this debate.

The work force has been described by British Rail Engineering Ltd. as the jewel in the crown. It has been described by a former managing director of British Rail Engineering as the most efficient wagon works in the whole of Europe. It has been held up as an example to other British Rail Engineering works of how co-operative and flexible they ought to be.

Sir Frederick Burden


Mr. Foster

No, I shall not give way.

Yet, in spite of all that, the flexibility, co-operativeness and adaptability of the workers is being thrown back in their faces.

Because of the closure of Shildon, the workers will find themselves without jobs. Those workers have not priced themselves out of their jobs, as the Government say on so many occasions. This is not caused by union bloody-mindedness. On the contrary, they have done everything that has been required of them.

The reason why they are out of work, we are told, is that the market has changed. That is true. We acknowledge that the market has changed. What markets have survived this recession? That, of course, is a material factor. We acknowledge that there is a more efficient way of using wagon works. We have never denied that.

What has been the growth of the private sector fleet? When I raised this question before, there was some confusion. The Secretary of State admitted that he was getting confusing reports from British Rail and British Rail Engineering. It seems to me that there has been a significant growth in the private sector over these past years while the British Rail fleet has been reducing. This has been partly because British Rail fleet clients have been buying wagons themselves, and that has been partly because of the tight investment limits placed on British Rail by the Government. I admit that it has also been partly because of good marketing sense. Of course, British Rail clients have begun to lease wagons—as we have been over this ground before I shall not go into the details—and that is not open to the British Rail Engineering works at Shildon. Therefore, we now find that we need small-batch, more specialised production.

What incenses me about this is that British Rail Engineering has almost entirely written off the idea that the Shildon works can carry out and compete for this kind of work. By extolling its flexibility and adaptability, however, it is pointing out that Shildon is capable of doing that kind of work, or indeed any kind of specialised production work that is required for today's market.

For a long time the over-valued pound did our manufacturers a great deal of damage. We discovered that other countries were prepared to subsidise their exports through their overseas aid programmes. In saying that, I acknowledge the help that the Secretary of State gave in securing the Congo order. We find that European competitors, too, often subsidise their rail wagon production through subsidised coal, transport and steel.

There is still a great demand for wagons. For instance, in my constituency 1 million tonnes of opencast coal is carried by road. The district council and I and British Rail Engineering have brought out schemes at Shildon which would enable it to be carried by rail, but these have not met with the proper response from the NCB.

I understand that British Steel is applying for a section 8 grant—public money—in order that wagons can be bought to transport scrap. Those wagons are going to be bought in the private sector. Again, public money ends up subsidising production in the private sector in competition with the rail works at Shildon.

Furthermore, in the past two or three days I have discovered that British Steel is exporting beams of steel to the continent in wagons imported from West Germany. What efforts are being made to make certain that wagons carrying British Steel products—the products of a nationalised industry—are built in this country? None, it seems.

Even if we were to concede that the market has changed and been reduced, it would still be there if the Government were to listen to sense and have an integrated transport policy in which rail played its full part. When we consider our European competitors and the percentage of traffic that they transported by rail, we begin to wonder why so little goes by rail in Britain.

I understand that official EC policy is for the integrated transport policy that we are advocating. Conservative Members of the European Parliament have voted for such a policy, yet Conservative Members in the House do not see the sense in that. It makes a great deal of sense. It would stop the damage being done to our buildings and villages and the slaughter on the road and would conserve fuel. Those are well-acknowledged arguments for transporting more freight by rail. The market would be there if the Government were to invest sensibly in British Rail along the lines advocated by both the unions and Sir Peter Parker in the rail policy documents. If that were done, there would be a full workload, not only for Shildon but for all the other wagon works.

Because of its adaptability and flexibility, Shildon is capable of producing other products. One would have thought that the business brains in the Government and in British Rail—people imported on to the board from the private sector—could devise an alternative business strategy for works such as Shildon to establish a growth pattern in place of this vicious cycle of decline. It seems that the people running the nationalised industries are experts in managing decline, with no imagination to look for diversification within their industries. Shildon's present workload could be used as a base upon which to diversify into other products. Every engineering process that is carried out at Shildon is capable of producing many saleable goods.

We throw down a challenge to the Government. The conveners, the district and county councils and I have always wanted to be constructive. Let us together work out a business strategy that would allow Shildon to prosper. If we could do that, not only would the Shildon works prosper, but that prosperity would spill over into the surrounding areas as well. Indeed, it might even become a growth point for south-west Durham instead of being a place that will accelerate its decline. It might become a new weapon in the armoury of regional development. Instead of accepting that the works must close and spending about £10,000 a job to bring new jobs in over a five or 10-year period—that is what we are talking about—we should save the existing works and its workload and diversity its products. Why do the Government not see the sense in such a policy? The public sector costs of closure are estimated this year to be £20 million at Shildon alone. It is estimated that to attract a comparable number of jobs would cost about £40 million. The Secretary of State said that £20 million would be saved, but a lot of Government money will have to be spent as a result of the closure.

Where were the Conservative and Social Democratic Members of Parliament when, on two occasions, 10,000 people marched through Shildon because the community was so incensed by the proposed closure? Where were they when 1,000 people marched upon Westminster and lobbied the House against the closure? Where were they when 5,000 people recently marched through the town of Darlington? Darlington vibrates with the sound of Tory crocodile tears splashing into their gin and tonics. One can also hear the quiet sobbing of the Social Democrats in Darlington as they eat their delicacies and wash them down with claret. But that crying is the result of fluffed orders rather than the demise of Shildon.

Only the Labour movement has shared in Shildon's struggles. Only the Labour movement has fought and marched alongside the work force. Only the Labour movement believes in them, their skills, values and way of life. Only the Labour movement wants to share power with them, and only the Labour movement can save those works.

4.44 pm
Mr. Mike Thomas (Newcastle upon Tyne, East)

We have heard from the hon. Member for Bishop Auckland (Mr. Foster) a sober and responsible account of Shildon's position. It was considerably more to the point and impressive then the account given by the right hon. Member for Barrow-in-Furness (Mr. Booth). Not even the Secretary of State, in the run-up to a by-election, seemed able to bite on the bullet and tell us the facts about it. We must look at the real reasons why it is proposed that jobs in Shildon should be lost. Then we should see whether anything practical and sensible can be done about it. I know that the hon. Member for Bishop Auckland has thought about that a great deal.

Why will the jobs go? The first reason has hardly been mentioned up to now, and that is that the railways are changing; they are using fewer wagons. The number of wagons dropped from 1 million when the railways were nationalised to 500,000 or 600,000 15 or 20 years ago. There are now 65,000 British Rail wagons and perhaps that figure will be roughly halved in two or three years. We might not like that. It might not be good news for those who work in Shildon, but it is irresponsible to conduct a debate without mentioning it. It is a salient fact that the market that has previously been supplied by Shildon has declined. We must not duck that.

We must also be clear—again the right hon. Member for Barrow-in-Furness was less than honest about this—that, although more investment is necessary, the more modern the equipment on the railways, the less maintenance work will be required. The right hon. Gentleman knows that 80 per cent. of the work in the railway workshops is spare part construction and maintenance, not new build. Even with a substantial programme of new investment, that proportion would not alter significantly.

I travelled to Braintree the other day in a carriage that must have been constructed shortly after the first world war, certainly not long after the second world war. God knows, we need new investment. Every time we produce a new multiple unit, locomotive or wagon we produce, certainly in the short run, less maintenance work, not more.

Mr. Booth

Will the hon. Gentleman accept that the logic of using the TOPS computer with a modern fast—running railway wagon, is that many more tonne miles a year will be run by each wagon and that means more maintenance, not less?

Mr. Thomas

I am sorry to have to tell the right hon. Gentleman that he is wrong about that. Of course, wagons are used more intensively, but at the end of the day less maintenance is required pro rata, and he knows that as well as I do.

The second reason for the problem in the railway works—

Mr. Harold Walker (Doncaster)


Mr. Thomas

I shall give way in a moment.

The second reason for the problem in maintaining rail workshops at their existing level is the decline in our basic industries such as steel and coal which are closely related. We know that a large part of the railway freight traffic is in coal and we know that when the coal and steel industries are suffering British Rail's turnover does not prosper. Indeed, it has declined. Therefore, the world recession has produced part of the problem, and that should not be avoided by the right hon. Member for Barrow-in-Furness and his colleagues. The Secretary of State also should have mentioned it.

The third reason—here I fully agree with the right hon. Member for Barrow-in-Furness—has been the failure to plan ahead and to invest accordingly.

For once the dividing line of 1979, which for understandable reasons the official Opposition pick upon, is significant. According to the Serpell report, after 1979 the amount of money made available for investment, and the amount that British Rail was taking up, declined substantially in real terms. The figures, expressed in 1982 prices, are £513 million in 1979, £401 million in 1980, £333 million in 1981 and £300 million in 1982.

There has been a decline in investment. There is a limit to how far that investment would have produced more maintenance work for the railway workshops. Hon. Members must be careful not to make the automatic assumption that more investment means more work in railway workshops. It is arguable that it might mean less. Nevertheless, more investment would mean more new build work than is currently being planned. The Government must take a share of the responsibility for that state of affairs.

The fourth reason for the decline in employment in the railway workshops—it has been skated over by both of the old parties—concerns trade union attitudes. I accept that the record at Shildon is extremely good. I am sure that the account given by the hon. Member for Bishop Auckland was accurate, not least because it met with the agreement of other hon. Members who have spoken on the subject. Union relations at Shildon are not the only problem. Strikes affect freight and passenger traffic and, therefore, the demand for coaches and wagons. There are problems of restrictive practices and overmanning.

The recently settled dispute involving the Bedford-St. Pancras line is a classic example of the way in which the attitudes of the railway trade unions, especially ASLEF, have discouraged investment and traffic. It is to the eternal shame of the Leader of the Opposition that during that dispute, which did great damage to the railways, he could do nothing but give his tacit support to what everyone knew and accepted was the most outrageous and damaging behaviour on the part of a small group of train drivers, because the trade unions pulled the noose tighter and tighter round the neck of the Labour party.

Those who work in the railway workshops will probably pay the price for the incompetence and irresponsibility of our political system over many years. This debate has been initiated not because of the proposed closure of three railway workshops or the lack of investment in the railway industry, as the right hon. Member for Barrow-in-Furness asserted, but because of the Darlington by-election. Had it not been for the Darlington by-election, there would not have been a debate.

Mr. Roger Stott (Westhoughton)

I am sure that the hon. Gentleman recognises that the official Opposition are allowed a certain amount of Supply time. This is the earliest opportunity that the official Opposition have had to debate this issue since the closure of the three workshops was announced. The debate has nothing to do with the Darlington by-election. The closure decision was taken four weeks ago and this is the first opportunity that the Labour party has had to debate it in the House.

Mr. Thomas

I am tempted to remark, Mr. Deputy Speaker, that if you believe that you will believe anything. The remarks of the hon. Member for Westhoughton (Mr. Stott) do not deserve a serious answer. The cause of this debate is the Darlington by-election. The hon. Gentleman protests too much.

It is a little galling that the Social Democratic party should be accused of opportunism by the Secretary of State. Despite his protestations, the truth is that there was no suggestion of the type of reprieve that is proposed in part for Shildon until after the Bermondsey by-election. Suddenly, informal discussions commenced in the week beginning 2 March or thereabouts between British Rail Engineering Ltd. and the National Union of Railwaymen to find out whether something could be done about Shildon. That just happened to be the week—surprise, surprise—when hon. Members knew the date of the Darlington by-election and when the writ would be moved. There was a meeting on Wednesday 9 March which the Secretary of State told me he had nothing to do with. However, as it occurred a few days previously, and British Rail did not seem to have any intention of producing those proposals until then, and as the only change in the intervening period was the announcement of the Darlington by-election, we must take his denials with a pinch of salt. At that meeting proposals were put forward that provided a basis for some progress as it was stated that a limited presence of 260 staff would remain at the works employed on breaking up surplus wagons, wagon repair, and manufacturing drop stampings and forgings.

Mr. David Howell


Mr. Thomas

I shall give way shortly.

In addition, it was thought that it might be possible to employ some further workers on wagon repairs or to allocate jobs at Doncaster to men coming from Shildon. British Rail proposes—

Mr. Harold Walker


Mr. Mike Thomas

I shall give way when I have finished what I am saying.

British Rail proposes that £250,000 should be given to the Sedgefield-Shildon Enterprise Trust—the hon. Member for Bishop Auckland has played an honourable and worthy part in getting that off the ground—to establish whether something could be done, as it was euphemistically termed, to "cushion" the consequences of the closure of the Shildon works.

Mr. David Howell

I am grateful to the hon. Member for Newcastle upon Tyne, East (Mr. Thomas) for having given way. His sentences are so long that it is hard to know when to intervene. A few moments ago he questioned my word. I told him categorically that there was no question of Ministers or officials intervening with the management in the handling of the Shildon closure procedure, or with negotiations by BREL or in any way twisting BREL's arm. The hon. Gentleman must take my word and not question my word, because that is the position.

Mr. Thomas

Perhaps it is better to leave it as one of life's remarkable and outstanding coincidences. Of course I accept the Secretary of State's word. I hope that he will accept my suggestion that the timing is quite remarkable, and we are grateful for small mercies.

Mr. Harold Walker

Did I understand the hon. Member for Newcastle upon Tyne, East (Mr. Thomas) to suggest that one way in which Shildon could be helped would be by a transfer of work from Doncaster? Doncaster is already facing several hundred job cuts. If the hon. Gentleman is advocating that, he is advocating redundancies at Doncaster.

Mr. Thomas

I am not suggesting that. I quite understand the right hon. Gentleman's concern. One of the proposals floated at the meeting on 9 March was that some of the workers at Shildon might, if wagon repair work was transferred from Shildon to Doncaster, do it there. The figure mentioned was about 100. As far as I am aware, there was no suggestion that there should be compensating cuts in the staff at Doncaster. As I understand it, that proposal was an addition. They were not my proposals but those of British Rail. They were volunteered entirely by British Rail coincidentally in the week when it became clear that the Darlington by-election would take place.

Shildon is important to people in the north-east because it demonstrates the Government's attitude to that area, and not only in terms of the jobs that might be lost. Unemployment in the north-east, even on the official, artificially low, figures, is 207,000, with about 6,000 in the Darlington area. Hon. Members know what has happened to the steel, coal and shipbuilding industries in the north-east. Shipbuilding has lost 10,000 direct jobs in the north-east since the Conservative party came to office. The power plant industry, which the Secretary of State knows something about and which affects my constituency, has lost many jobs and there is the prospect of more losses.

The north-east is coming to the conclusion that the Government do not have the will to save jobs in the area. They took an interest only when the Darlington by-election arose and the Government thought that there was an outside chance that they would win it. Previously, they had thought that there were no seats to be won in any shape or form in the north-east, so why bother about it? Before Labour Members lean back to take comfort at that thought, I should point out that the north-east is also rapidly coming to the conclusion that, because the Labour party thinks that its seats are fiefdoms for ever, it has taken the area for granted.

Before I hear any more protests from the hon. Member for Westhoughton, I should make clear what happened when he was Parliamentary Private Secretary to the right hon. Member for Chesterfield (Mr. Varley). My constituents had to fight up hill and down dale against a Labour Government to save jobs at C. A. Parsons. The plan that the Conservatives are now reactivating about power plant would, if carried through, reduce employment at Parsons in my constituency to 2,000 people and was originated by the right hon. Member for Chesterfield. Therefore, people in the north-east are not too enthused by the policies that the Labour party and Labour Governments have offered them.

Mr. Michael Martin (Glasgow, Springburn)

What was in the hon. Gentleman's election address?

Mr. Thomas

I probably agreed with more of my election address in 1979 than the right hon. Member for Ebbw Vale (Mr. Foot) did and I probably agreed with 90 per cent. more than the right hon. Member for Bristol, South-East (Mr. Benn) did. However, that is their problem, not mine.

The Labour party's irresponsibility is clear for all to see. It stems from something that we saw again yesterday. It stems from the connection between the Labour party and the trade unions, which has now taken the party out of the frying pan of the far Left into the fire of the TUC. We can see the improper relationship that is developing in the deal that has apparently been done with the TUC. In my day, deals with the TUC were thought improper. However, according to today's edition of The Times, Mr. Len Murray is to appear on a platform with Mr. James Mortimer and the Leader of the Opposition to launch the deal. Indeed, the right hon. Member for Ebbw Vale cannot even get the quid pro quo of an incomes policy for all the sacrifices that he is offering up. Because of the improper relationship in the past between the Labour party and the trade unions, many of the problems in the railways and in the railway workshops have not been faced in time. The men at Shildon may well find that they are having to pay for a change in attitude and an acceptance of the new world of the railways that is coming far too late.

I shall briefly explain exactly what our position is, because I know I shall be accused if I do not do so. We believe that the very minimum that should be done is what was put forward at the railway shopmen's national council meeting on 9 March. We believe that that would provide a breathing space. It is wholly unrealistic to suggest that the whole of the Shildon works could be preserved as it is. No one in the north-east believes that that is a practical proposition. However, the position of Shildon could be preserved and the works could be restarted if we had a Government who would invest, would electrify our main railway lines, would renew the rolling stock that so desperately needs renewal, and who would go for a firm commitment to maintain the rail network more or less as it is now and let the railways develop again.

The position of Shildon could be preserved if that was paralleled not by an incestuous relationship with the trade unions but by a proper relationship with them that spelt out clearly that an efficient, profitable railway that invests cannot be run other than on a proper basis. By "a proper basis", I mean proper manning, not overmanning, doing away with restrictive practices, running stock that has been purchased and allowing investment to pay off. Unless those two factors are twinned, the jobs at Shildon cannot be preserved. The Government have no will to preserve the jobs. They make the blind, simplistic assumption that competitive pressures will sort everything out. There is no will to save those jobs in the north-east. On the other hand, Labour Members make the old assumption that if the unions are given whatever they want and if public money, paid for by others who end up out of work, is thrown at the problem, it will be solved. Neither of those solutions makes any sense.

If there were a general reflation of the economy, proper investment in freight traffic, and a highly productive and internationally competitive industry in maintenance, manufacture and the running of the railway system, the Shildon works might have a chance. However, I resist the charge of opportunism. We believe that if that chance does not pay off and if at the end of a period of grace of two years—after 1984—it became clear that it was impossible to sustain the position at the works or to obtain the necessary work, we should have to face up to the conclusion. However, that must not be done without having thought about it properly.

That is what is wrong now. Things have been done too precipitately. It should be possible to think in terms of what can be done through a trust, other industry, an employee buy-out, or whatever. However, none of those things has been done. It was intended that the works should be closed without doing any of them. A minor solution and proposal was cobbled up in the week beginning 2 or 3 March when the Conservative party saw a by-election coming along. As a result, we are debating the issue today and the situation is in a mess. The problem is not capable of easy solution, but it is capable of a better solution than either the Conservative or the Labour party offers.

5.5 pm

Sir David Price (Eastleigh)

I hope that the House will forgive me if I do not follow the hon. Member for Newcastle upon Tyne, East (Mr. Thomas) down his many lanes. I am very tempted to give him my railway policy, and policy for the north-east. When I had the honour to be Parliamentary Secretary at the Board of Trade between 1962 and 1964 we produced in those three years as many new jobs for the north-east as have ever been produced. Therefore, I shall not take lectures from the hon. Gentleman about how to help the north-east. I have not had that ministerial responsibility for many years, but that is another story.

Like the hon. Member for Bishop Auckland (Mr. Foster) I have personal reasons for seeking to intervene in this debate about the future of our railway workshops. First, I think that the House knows that the British Rail workshops in Eastleigh have traditionally been the largest employer in my constituency. However, some would argue that that accolade should now go to Pirelli General.

Be that as it may, the British Rail workshops are still substantial employers of great significance to my local community. Like the hon. Member for Bishop Auckland, I pay particular tribute to the part that railwaymen and those in railway workshops play in the community. They play a prominent part in charities and local affairs. Even though they do not always support my political views, they are very good colleagues and neighbours.

Eastleigh has seen a major change in the pattern of its railway workshops. It is worth reminding the House about it, because it is relevant to the workshop prospects in other parts of the country. When I first became Member of Parliament for Eastleigh there was not one workshop, but three workshops. We had an admirable locomotive workshop, which made splendid steam locomotives. With the passing of steam, that facility went. When the market disappeared we had to stop making them, because they were no longer required. We had a carriage works, where we made new carriages. That is not done any more. We also had a smallish wagon works.

Today there is only one works, which is devoted entirely to the repair and maintenance of rolling stock, and especially to major overhauls. The reconstruction of coaching stock is of particular importance. It is an ill wind that does not benefit somebody. I think that we have marginally gained from the lack of investment by the southern region in new coaching stock. As a result, carriages are being given a new lease of life in our workshops, whereas in the past they would almost certainly have been scrapped. Indeed, in an ideal world they probably should be.

Eastleigh has, therefore, been through all the stress and anxiety of a fundamental change of function within the railway system, and without any major industrial conflict. I wish that the critics of the British Railways Board would give it and the rail unions more credit for the amount of change and the overall job losses that the railway community has absorbed with remarkably little "aggro" since the end of the second world war.

My second reason for intervening in the debate is that I am a member of the Select Committee on Transport. Since the Serpell report was debated in the Chamber we have taken public evidence from the principal characters involved. We have not yet made our report to the House on those hearings and it would be most improper of me to anticipate it. Therefore, I must exercise a degree of self-denial in what I say today. However, it is entirely proper that I should draw to the attention of the House evidence given in public that bears upon the subject of today's debate.

The first factor about which I should like to remind the House is the scale of BREL's activities. This was given to us clearly by Mr. James Urquhart and supplements chapter 7 of the principal Serpell report. Of BREL's turnover of £600 million, about 60 per cent. goes to the maintenance of the existing British Rail fleet; 15 per cent. goes to the manufacture of new equipment needed to maintain that fleet; 20 per cent. goes to the construction of new rolling stock; and a little simple arithmetic shows that 5 per cent. goes on miscellaneous activities, which include some outside work.

As I have always understood it—it is certainly the case in Eastleigh—the management has always been free to take outside work where it can be fitted in to its main works programme for its principal customer, British Rail. It has been open to the works management to find outside work where it can. The management always tries to do so, but I can speak only for Eastleigh.

It is clear that 75 per cent. of BREL's activity relates directly to the current operating needs of British Rail. It therefore follows that the future scale and deployment of BREL's activities must be closely related to the future of the railway system as a whole. It cannot be viewed in isolation. Indeed—I put it this way—it must follow decisions that are made about the future of the railway system.

I am glad to be able to report to the House that the chairman of British Rail has, in the past, taken the same view as me. He told me in July 1981 that the works at Eastleigh is in a better situation than most as its main workload involves the repair of passenger train locomotives and rolling stock for use on our Southern Region. This raises the question whether there should be a separation of responsibility for maintenance work from new construction. I put to a number of witnesses the clear question whether it would not be a better management model if the maintenance responsibility came directly under British Rail and was not hived off, as it is, to BREL.

Mr. Ron Lewis


Sir David Price

I shall give way to the hon. Gentleman in a moment. Mr. Urquhart, who is, as the House knows, the main board director of British Rail and has overall responsibility for the workshop activities, gave an interesting reply. He said: We have thought in the past, and considered the pros and cons, of totally separating the maintenance workload from the building and we have concluded there are tremendous benefits in the present mix, in that there is a stable workload for maintenance, which provided the ability to sustain the factory capability, which in turn can absorb the peaks and troughs of new building and work as it comes along. I shall not continue the quotation but Mr. Urquhart develops in the point further. To me that is a strong case in favour of present arrangements, but would those arguments remain valid if there were a different relationship between BREL and British Rail?

Mr. Ron Lewis

The hon. Member has certainly made a good case, with much of which I agree. The hon. Gentleman said that he had an assurance from the present chairman of British Rail that Ashford would more or less remain as it is. In the event of the present chairman being demoted, which appears to be on the cards, will that assurance hold under a new chairman or will the cut take place in Ashford?

Sir David Price

It is not Ashford, but Eastleigh.

Mr. Lewis

I meant Eastleigh.

Sir David Price

Ashford is in a rather different position. The letter from which I quoted was written in July 1981. The hon. Member for Carlisle (Mr. Lewis) will not be surprised to learn that I have recently written to Sir Peter Parker to ask him whether he could renew that assurance in the post-Serpell context. I have not yet had a reply.

Mr. Lewis

Will the new chairman do so?

Sir David Price

I assume continuity of collective responsibility.

I was about to develop the point that the separation of maintenance responsibility from manufacture could be made a valid managerial case if some of the proposals in the Serpell report were to be carried out. What seems to be agreed by one and all is that there should be an arm's length relationship between BREL and BR. It is the current working of that arm's length relationship that has been questioned by Sir David Serpell and by Mr. Goldstein. However, the relationship in its present form is strongly defended by Mr. Urquhart, who said: I think the relationship between BREL and the railway on operational day-to-day issues and the running of the railway is excellent. The problem of the relationship is one of contractual agreement during the period when there is demonstrably developing a surplus of capacity in BREL and the problem really is to identify what that surplus is and how the surplus may be removed and how the railway can avoid having to pay for the surplus. There, in a nutshell, is the issue facing the House.

It is interesting, too, that Mr. Goldstein, who was a critic of the way the arm's length relationship was working, nevertheless found himself compelled to commend the standard of management in BREL. I shall quote some of the phrases Mr. Goldstein used. He said: I hope it comes through the report, with some very bright management people in BREL, very keen, that whilst they were very loyal, inevitably there was a degree of limitation, restraint, imposed on them. They really want to get up and go and do well. They are not masters in their own house and when we looked at this it did seem to us that whilst the principle of arm's length has been the intent, de facto it would not work and therefore we felt that it ought to be instituted. I take that as quite encouraging. An independent consultant, much criticised in the House for being too tough, comes away praising the management of BREL. That should be worked on and I hope that British Rail will work on it.

It is simply not possible to make decisions about BREL in isolation. It comes back to the clear message coming out of our debates, coming from all the reports and, from listening to witnesses on the Select Committee—that the future of the railwork workshop depends almost entirely on the decisions that have yet to be taken on the future and shape of our railway system. Therefore, the future of BREL cannot be determined in isolation. But, determine the former and the latter will almost certainly determine itself.

In my judgment, the railways will always need their own workshops. Therefore, the sooner the major policy decisions about the future of the railway system are taken by my right hon. Friend the Secretary of State, the better it will be for everyone. I am sure that he will recognise that the uncertainties leading to continuing anxiety in the railway community, which have been stimulated by Serpell, are bad for everyone. The sooner they can be ended, the better for us all.

Mr. Deputy Speaker (Mr. Paul Dean)

Before I call the next hon. Member, I must inform the House that the winding-up speeches are expected to begin at about 6.20 pm. Many hon. Members with strong constituency interests still wish to take part in the debate. It will help greatly if speeches are brief.

5.19 pm
Mr. Arthur Lewis (Newham, North-West)

I hope that the hon. Member for Eastleigh (Sir D. Price) will not be offended if I say that I thought he made an excellent speech, or if I were to suggest to the Government that he would make a better chairman than Sir Peter Parker. I am not enraptured by Sir Peter Parker or by the Government allowing him to work part-time for about £75,000 a year.

It is amazing how the Government can find millions of pounds to bring men from Canada and America, give them jobs and then put them on to part-time. The Government always sack the lower-paid workers and make them redundant. The trouble with British Rail is that there are far too many highly paid administrators. Cut a few of them out. Cut out some of their first-class travel, and we might make some progress.

It annoys me that the Government are deliberately causing unemployment and preventing an advance towards full employment. A couple of weeks ago the Lords debated the Transport Bill in the other place. They objected to a nominal subsidy for the man who goes out to work to earn money, although the Lords are being paid. Some of them get £300 per day. That is paid for by the workers while the Lords object to the workers receiving a subsidy to travel to work by train. They receive a 100 per cent. subsidy for first-class travel. They do not object to that. They come from their homes in Scotland right down here. They say, "Hello" and off they go—firstclass—while the poor old railway worker must be kicked.

I resent the Lords. They all have two or three jobs. They are allowed to hold chairmanships of public boards, private boards; have a fiddle here and a fiddle there and help themselves here and help themselves there—legally, of course. They have tax-free pensions. The hon. Member for Newcastle upon Tyne, East (Mr. Thomas) is here from the Social Democratic party. Thank God that Lord Shawcross has gone over to them. We have lost him.

We could solve all British Rail's problems by encouraging the railways. Cheaper fares would encourage people on to the railways and off the roads. We would save on the import of tyres and the rubber that goes into them, and be able to increase production. Instead, everything that is done is done to run down the industry.

Temple Mills is in the area that I represent. The hon. Member for Eastleigh rightly paid a tribute to railway workers. This country, the Minister, and the House would not be here if it had not been for the excellent endeavours of railway workers during the last war. I know" I was there. Temple Mills was bombed night and day. People lost their homes, not once, but three or four times. They still worked to repair the trains and get the locos out to move the munitions and everything else.

The industry was promised many things and then along came Dr. Beeching and all the other cuts. There were cuts at Temple Mills and the great heroes who had helped the country to survive were kicked out. Lord Beeching is all right; he goes up to the other place and receives hundreds of pounds a day.

The Government are responsible for causing muggings, lawlessness and vandalism. In my younger day, when kids left school they used to fight for apprenticeships at Temple Mills. There is no fear of them doing that now. There are no jobs. They do not want to go to school; they want a job. Instead of standing around they start smashing and vandalising things. As a result, the Government pour money into the police. They double police pay to ensure that there are enough police to deal with these chaps who should have jobs in the railway workshops.

The Minister mentioned exports. It is a pity that the right hon. Member for Sidcup (Mr. Heath) is not here. He is very interested in the Third world, as we all are. Today we have with us his excellency President Kaunda of Zambia. We welcome him. It is rumoured that he will ask for more of the British taxpayer's money to help his country. God bless him, I hope that he succeeds.

I have only once, during 38 years, had the pleasure of going to a Commonwealth Parliamentary Association conference. A couple of years ago I went to Zambia. I was delighted to be able to travel from Stanleyville to Lusaka. It was an eight and a half hour train journey. The train was dead on time leaving and arriving. It was the most beautiful train that I have ever seen. I asked where it was made and was told that it was made by Hitachi in Japan.

The United Kingdom supplies Zambia with money, and it buys trains from Japan. Why do we supply it with money? We want to help it, but why cannot we say "If you want trains, we will supply them. We will build them here." Instead of giving them British taxpayers' money and putting our people out of work, we should supply all these developing countries. They do not need to go to Japan. It would help not just those employed in the railway industry. The trains would have to be shipped. We heard yesterday about the shortage of work in the shipping industry. There is a shortage of orders for ships. We should need the ships and the seamen to transport the goods.

It is about time that we stopped giving money to developing countries for them to spend where they will. Let us say to them "If you want trains and railway lines, we have the best workshops and the workmen. Do not go to Hitachi and other countries. Come to Great Britain." The Government should insist on that. It would not cost more money. It would not lead to inflation. Instead of giving hundreds of millions of pounds to Zambia, Zimbabwe or anywhere else, we should tell them to let us know what they want and we should provide the goods. They cannot manufacture everything themselves. We should supply them with goods to develop their agriculture. They buy marvellous agricultural implements and machines, but not from Great Britain. They use British money to buy those goods from Germany and France.

The leader of the SDP, the right hon. Member for Glasgow, Hillhead (Mr. Jenkins), spoke earlier and walked out. He has declared that he receives a pension of half his salary. He spoke about his party not having an incomes policy. How would an incomes policy affect him? He receives a tax-free pension of half his pay. Does that come from the British taxpayer? We all talk about what should and should not be done. It is simple; all we have to do is take our fingers out of other people's pockets and say that we will look after the workers.

When the chips are down, everything that we have in this country is paid for by the ordinary blind, disabled, sick and unemployed people on the street—the consumer. It all comes out of taxation. All those people now pay taxation. In my young day they did not. They did not have enough money, so did not pay taxation. Now we have VAT, thanks to the SDP. We have indirect taxation. Now everyone pays taxes. Ultimately, the ordinary taxpayer pays. If we asked the ordinary taxpayer who is paying X pounds per week whether he wanted the money to go towards good railways with a good freight and passenger service or whether he would rather pay the unemployed unemployment pay, I am sure that he would say that he would rather we developed the industry than carry on in a stupid way, as the Government are doing.

5.31 pm
Mr. Geoffrey Dickens (Huddersfield, West)

I am delighted that the debate is taking place today, because it is right that the official Opposition should do their job of opposing, and, as the Government, we should be here to explain. I am disappointed that there is not one Liberal Member in the Chamber. It is only a suspicion on my part, that many of them are knocking on doors in Darlington and making promises when they should be fighting with the Opposition for the people in that area. They are paid to be in this place, but they are not here.

On many occasions when my hon. Friend the Prime Minister has been pressed at the Dispatch Box about the economy, she has said that the only way for our industry to survive is for it to produce products that people wish to buy, deliver them on time, make them the right quality, give a good after-sales service and make them at the right price—in other words, a competitive price. I am sure that everyone in the Chamber will agree that the British Rail Engineering workshops have done an excellent job. We could not criticise them on the last four items that I have mentioned. They fall down on only one item. It is no fault of their own. This is a changing world. British Rail is not producing in its workshops the products that people wish to buy because of the changing world.

I am sure that hon. Members on both sides of the House offer sympathy to the families of the work force. I know that sympathy does not help, but at least all of us care about unemployment and we are deeply conscious that to close the workshops means misery and sacrifice for families in many parts of the country.

My right hon. Friend the Prime Minister has said on many occasions that the Conservative party has a fresh and resolute approach. We are not going for cheap popularity for the benefit of by-elections. It would be easy for a weak-kneed Government to buy a few votes by making a promise from the Dispatch Box to keep the workshops in Shildon open. That would be popular and might even win us the by-election. However, that is also a great responsibility for a party in government, because, if we subsidise and keep unviable units open, someone else has to pay for them. We are the custodians of other people's money. We control the taxpayers' money. We have to use it sensibly. That is the only way to manage a country.

The Labour party need not show great glee, because I recall the British Steel Corporation closures in places such as Ebbw Vale, East Moors, Shelton, Glencarnock and Bilston. I also remember the days of Lord Robens, under the Labour Government, when tens of thousands of miners were thrown out of work as pit after pit was closed, causing misery to many of the communities that had no other form of work. The Labour Government did not introduce the sort of measures that we have introduced in an attempt to save and produce new jobs, and they did not emphasise the importance of small industries and private enterprise. Those people were left absolutely stranded.

Unfortunately, three closures of railway workshops have been announced—Shildon, where 2,000 jobs will be lost, Horwich, where 1,100 jobs will be lost, and Temple Mills, where 300 jobs will be lost. No votes are gained after people's jobs have been lost. If there was an easy, quick solution, do not Opposition Members think that we would have applied it? Most of us have been affected by unemployment.

Let us consider the argument. Shildon is a single—purpose factory. It could produce 1,500 new wagons a year. That is what the factory is designed to produce with its equipment, gantries, cutting and preparation machines, bending machines, and so on. It could even repair 15,000 wagons a year. However, we know that for the next three years at the very best it will have orders for only 150 new vehicles per year and, optimistically, only 9,000 wagons will come into the workers' hands for repair.

The Shildon work force is superb. There is no doubt about that. It is good and not out of date, but the workers are heavy fabricators, with platers, welders, riveters and fitters. There are few electricians and no vehicle-building craftsmen. It cannot go into other areas, because it is not geared to do so.

We have heard talk of the new type of wagon—the modern freight wagon for the Speedlink services. If British Rail is to be competitive and attract business, it must do it in the cheapest and most effective way. Otherwise, it means shovelling taxpayers' money into the nationalised industries yet again, the result being false jobs and no future.

Nearly £1 billion was given as a grant by the Government last year and £1,600 million has been invested in British Rail since 1979. I remind the Opposition that only £1,100 million was invested by the Labour Government in the previous four years. British Rail has tried to save those yards. It has been said that it did not care and that we did not care. We care and British Rail cares.

British Rail consulted British Steel about its movement of steel and the wagons on which the steel was carried. There was serious consultation with British Steel. British Rail got in consultants to study job creation in those works. It has done everything possible to try to save those jobs.

British Rail will try to suppport the local enterprise trust. The House will be pleased to know that at the moment negotiations for an enterprise agency in Shildon are going on. I want to talk about help. When the Labour Government carried out their cuts, there was not much help. People say that we do not care, that we throw people out of work and that no provision is made for them, that we have done nothing and that now, when there is a by-election, we are saying that we shall do something. I shall remind the House of some of the things that were done before there was any talk of a by-election.

Help for small businesses is being given in the Shildon and Darlington area. There was some provision for employment in my right hon. and learned Friend's Budget. Since 1966, about 55 manufacturing firms have located projects in the area. Sadly, 18 of those have since closed. The remaining firms, which employ 3,800 people, include Carreras Rothman, which opened in 1971, and Darchem, which opened in 1974. There have been more recent positive developments. Cleveland Bridge and Engineering Company Ltd, which opened a new £26 million factory in Darlington in January 1982, has recently won a £20 million contract to supply steel sections for a new power station in Berlin. Tallent Engineering, Darlington, has increased its work force by 80 as a result of a contract to supply suspension arms for the Ford Sierra. Fine Fare is to build a 56,000 sq. ft. superstore in Bishop Auckland, which will employ 180 people by mid-1983. GEC Telecommunications, Aycliffe, is recruiting 165 workers in 1983 as a result of its job-sharing scheme. Construction of a new £1.75 million office and shops development in Aycliffe town centre has begun and 100 new jobs are expected there.

Mr. Arthur Lewis

I know that the hon. Gentleman is reading the Conservative Central Office handout. Would it not be better and easier for him to ask permission to include it in the Official Report to save his and our time? He could then circulate it. We have all seen it.

Mr. Dickens

As usual, I am grateful to the hon. Gentleman for his help. Perhaps I had better stop there.

I should point out that if a fraction of the investment that has been poured into British Rail were poured into the textile industries of Yorkshire and Lancashire, we would not be facing our present problems. As I said at the beginning of my speech, when we subsidise concerns which do not have the full order books to support them, someone else must pay. Only a responsible Government have the guts to do what must be done, even if it does not win votes.

5.42 pm
Mr. Michael Martin (Glasgow, Springburn)

I am conscious of the fact that many other hon. Members wish to speak, so I shall be brief. I was disappointed by what the hon. Member for Newcastle upon Tyne, East (Mr. Thomas) said. He referred to the Darlington by-election and said that hon. Members were here to debate the subject only because of that by-election. It is a pity that he was not here when we debated the Serpell report, because the speeches made by hon. Members on both sides of the House then were excellent. The Chamber was packed even on the day before, when the Secretary of State made his statement. Those occasions showed that both sides of the House are interested in the railway industry and in British Rail Engineering workshops. The speech of the hon. Member for Newcastle upon Tyne, East showed that he knows very little about British Rail and British Rail Engineering Ltd.

There is only one employer worth talking about in the community that I represent—the British Rail Engineering Ltd. and Springburn workshops. They are the only engineering workshops in Scotland, and if anything happens to them we shall give more ammunition to the nationalists in Scotland. I am proud to be Scottish. I am proud of my culture and my heritage, but I fear nationalism because it brings out the worst in people. The Government have as much of a responsibility in that respect as the Labour party to ensure that the nationalists do not derive more ammunition than they already have.

It is all very well for hon. Members to say that there will be a Safeway supermarket in Bishop Auckland, but nothing can replace the type of work that is being done in railway workshops. It is important that people do work in which they can take a pride because it involves skills that have been built up, not merely over a few years or months but over generations.

The hon. Member for Eastleigh (Sir D. Price) made an excellent speech and referred to the steam locomotive workshops. When those locomotives were being built, there were four workshops making them in Springburn. A worker would have been considered eccentric if he had even attempted to travel out of Springburn to another part of Glasgow for work because there was plenty of work in Springburn during the 1950s and the early 1960s.

I should like my children and those of my constituents to have a place of work where they can go and learn a skill of which they can be proud. The west of Scotland is famous for its engineering workmanship. Springburn is one of the few areas that can obtain apprentices to be trained for the future. The Government keep talking about the recession bottoming out and things getting better if we make sacrifices. Even if we accept that argument, when we come out of the recession the first thing that we shall need is skilled men. We must have employers to train skilled men and women. We shall be able to do that only if the Government face up to their responsibilities and ensure that there is proper investment in the industries that we are debating today.

Many of my constituents and, no doubt, those of other hon. Members are anxious about vandalism. Some people talk of giving the police more powers to curb vandalism, but what do they expect if young people leave school at 16 and, by the age of 20, have still never had a job worth talking about? How can we ask our young people to respect the community and the environment unless we can give them some hope for the future? I hope that Ministers will note that and give us hope of a future for the communities that we represent.

5.47 pm
Mr. Kenneth Warren (Hastings)

I declare an interest in that I was associated with the British Rail computer-controlled freight utilisation system some 10 years ago. Through that association, I gained an appreciation of the tremendous skills and devotion of BR employees of the type that has been mentioned by hon. Members on both sides of the House today. I accept that the skills that those men have are a result of the apprenticeships to which the hon. Member for Glasgow, Springburn (Mr. Martin) referred. Those skills are the result of a lifetime of work which, when collected together, represent a unique national asset.

It is gratifying to hear hon. Members say that those men and their workshops are among the best in the world. My hon. Friend the Member for Eastleigh (Sir D. Price), who voiced the attitude of BR management, said that they are probably the best in Europe. At that moment, however, my understanding of what is going on parted company with what has been said so far.

One person is missing from the Chamber—the chairman of British Rail. It is he who should reply to the debate as the questions that we are asking cannot be answered by the Government alone, whatever party is in power. British Rail management has an answer which it should have been giving to the workers at Shildon and other places for years. It should have explained what is being done with the substantial investment that taxpayers have made in British Rail. Shildon is a fine workshop, but it is difficult to understand why British Rail management has allowed it to grow to a size that is 10 times greater than the demand for its services justifies. Something must be wrong if that has been allowed to continue for a long time.

What does British Rail management propose to do about exports? The hon. Member for Bishop Auckland (Mr. Foster), who spoke with great feeling and knowledge about Shildon, said that many countries subsidise the output of their railways to make it more competitive abroad and the hon. Member for Newham, North-West (Mr. Lewis) also mentioned that point. But we are contributing nearly £1,000 million a year to British Rail, which is a direct subsidy that should help exports from places such as Shildon. What has happened over the years to allow that workshop to come so near to the precipice of destruction?

Sir David Price

In his evidence to us, Mr. Urquhart made it clear that, because of infant industrialisation in many of the major Third world countries, there was a market not for wagons, but for sophisticated locomotives and carriages. British Rail Engineering Ltd. has successfully sold coaching stock, restaurant cars and the like, but not wagons, to the Third world.

Mr. Warren

My hon. Friend, with his considerable knowledge, takes me straight to the point that I was about to make. Why has that workshop ended up without the relevant skills that would have enabled its workers to diversify into the available markets. There is a demand. China is one of the world's great expanding railway nations. If the workshop could not provide rail wagons, why could it not turn its skills to the gigantic growth of the container industry in air, sea and rail freight? That is a management problem, and I am grieved that those skilled workers were not led during the time available, and with all the investment in British Rail, to a point where they could use those skills.

Perhaps my hon. Friend the Minister will tell the House whether British Rail workers are allowed to bid for private enterprise contracts, to which the right hon. Member for Barrow-in—Furness (Mr. Booth) referred? If they are, what is their success rate and are they being encouraged to bid even now?

From what I learnt from the computer control study that is now being implemented by British Rail, I do not understand how the industry can get into such a tangle. When we considered its use of freight wagons, we found that not only did they move on average only a few miles a day but that many thousands were missing at any one time. That was a management problem, but even when the wagons were found there was no demand for them. That study, which was completed and introduced 10 years ago, should have been reflected rapidly into the output demand at Shildon, which would then have had time to diversify into other markets.

Although the members of British Rail's management cannot answer my points in the House today, I must ask what they have been up to. My right hon. Friend the Secretary of State will know how keen we are in Hastings to have an early reply to our request for electrification of the line there. There is a demand for new passenger stock and new wagon stock, but it is difficult to realise that demand. The hon. Member for Keighley (Mr. Cryer), who is unfortunately not here now, said that some trains must travel 1,000 miles a day, which is wearing them out. But there must be something wrong with British Rail's engineering standards if the trains cannot run for 1,000 miles a day. Aeroplanes, which are much more complicated, are expected to cover 6,000 or 7,000 miles a day and produce seat-miles costs lower than those of British Rail.

What is the standard of design leadership in British Rail? Why should it have problems with the advanced passenger train? The tilt design problems are merely stability problems, the mathematical solutions to which are well known in the aerospace industry. What about the failure of the wheels and axles on that train? What quality assurance is there for the metals used? Why are trains still delayed by leaves on the line or by frozen points? How can we allow the taxpayer, who is subsidising British Rail heavily, to travel as a commuter in cattle truck conditions that are a disgrace and a hazard to public safety?

British Rail management has much to answer for in bringing to the edge of the precipice places such as Shildon. The problems there epitomise the need for tighter and more effective management of British Rail if it is to justify the substantial subsidy provided by the taxpayer each year. I hope that both sides of the House will agree that it would be totally wrong for the workers at Shildon to be fought over as pawns in a political debate on the eve of an election, because many more fundamental questions must be answered.

5.56 pm
Mr. David Young (Bolton, East)

The matters that I shall raise have no bearing on the Darlington by-election. The Horwich workshops are not in my constituency, but they employ many of my constituents. The economy of the entire area will be affected decisively by the closure of those workshops. If the standard of the Government had been up to the standard of the workers at Horwich in their willingness to adapt and to meet the criteria laid down, we might not have 4 million unemployed in Britain today.

I wish not to bandy arguments across the Chamber but to make specific points. One reason why Horwich is in trouble now is that the Government have decided to cut the rail network, on which places such as Horwich depend. The closure of such workshops is the thin end of the wedge to implement the Serpell report. Not only workshops but entire communities are involved, and such facts are skimmed over when we talk in narrow departmental terms. The decision to close Horwich goes far beyond the geographical boundaries of one area.

I represent what was once a textile constituency but where engineering has replaced textiles as the occupation of many people, and there have been twice as many redundancies in engineering in the past three years as there have been in textiles. In January 1983 in the Greater Manchester council area, 43 people were chasing one job. In February 1983 in Bolton, 47 people were chasing one job. In the Greater Manchester council area, 163,628 people were employed in engineering in 1978 compared with 120,861 in 1982. In the same area, the number of apprentice craftsmen in engineering has been reduced from 1,446 in 1978 to 503 in 1982—a decline of 65.2 per cent.

The key factor is that the Horwich workshops are one of the main training grounds still left open in the area for engineering apprentices. It is not only the closing of the workshops but the discarding of the engineering skill and expertise on which the future of Britain is supposed to depend. Ministers talk about closures being the way to new full employment, but I think that it is like saying to people that if they suffer from pernicious anaemia they should go to be treated by a vampire. Slowly, but surely, industries are being bled to death, and not one job is forthcoming.

The social cost is enormous. If Horwich closes, 1,138 jobs will be lost. In sub-contracting and supplies, another 50 jobs will go. If the spending potential of the community is between £2.5 million and £3 million and 40 per cent. of that goes into the local economy, there will be a loss of between £960,000 and £1,200,000 a year to the local economy, which is equal to 21 jobs. These figures come not from any party central office but from the joint unit for research on the urban environment of Aston university.

If the total job loss is 1,209, and the unit calculates in its survey that the cost to the state of each lost job is £1,470 per annum in loss of tax and insurance, and in social benefits £1,428 per annum, the total cost to the state will be about £3,503,682. That is without including the £400,000 in lost rates to Bolton and taking no account of lost rates to the North-West water board.

In 1979–80, some 70 apprentices were taken on at Horwich by BREL. No apprentices started in 1982–83 because of the threatened closure. If those works are closed, 214 apprentices will be looking for jobs. Where will they go? There is no place in Bolton or the surrounding area that can take up that slack. The prospects in Bolton, Bury and Wigan are limited. In 1980 the federated engineering companies in those towns employed 16,344 people. In 1982 they employed 13,273. We are talking not about accountancy figures but about individual tragedies of people who are sacked, whose skills are lost, and who have nowhere to go. We are looking at the death of a community, and the responsibility lies at the door of the Government. By proposing to throw these skills on the scrapheap, the Government are jeopardising the future not only of those who are made redundant today but of generations to come, and with it the future of engineering in the area.

The Government must look at the full implications of their policy. These workshops are being closed not because they are inefficient but because there is a lack of political will on the Conservative Benches to see that they are kept open.

6.6 pm

Mr. David Stoddart (Swindon)

The hon. Member for Hastings (Mr. Warren) asked why Shildon found itself in its present position and tried to answer the question by blaming British Rail. That is not the true answer because British Rail had to work under the writ provided for it by the Government.

Shildon finds itself in its present position for reasons that began in 1953 with the Transport Act 1953, which broke up the British Transport Commission and did away with co-ordinated transport undertakings. That was followed by the Beeching cuts, and by that time we had allowed subsidised lorries on our roads, which undermined the position of British Rail. Those are some of the reasons why Shildon and other workshops find themselves in their present position. It is the attitude of Governments, particularly Tory Governments, that has caused the crisis that faces British Rail.

The position of railway workshops in Swindon, although not the same as those in Shildon, Horwich and Temple Mills, is very similar. It is true that the Swindon workshops were not marked for closure in the most recent announcement, but their future is uncertain. From what we can hear, the workshops in Swindon have no future beyond 1986. In other words, Swindon could be the next workshop to close.

There has recently been an outcry in Swindon over the secret plans drawn up in 1982 for the works to be closed. BREL says that these have now been dropped, but, as far as I and the workers at Swindon are concerned, there is no long-term future for the railway works there. We have had great headlines such as "Fear over BR's secret plans" and we can get no assurances that the workshops will remain open beyond 1986.

Today it is Shildon, Horwich and Temple Mills—tomorrow it will be Swindon. The workers at Swindon and elsewhere are entitled to be aggrieved at what they see as treachery by the Government and British Rail over a long period. The work force in Swindon and other places has co-operated to the full in increasing efficiency and the effectiveness of the railway workshop. Indeed, the railwaymen have led the way in introducing new practices, eliminating demarcation disputes and using labour, space and materials more effectively and profitably. At Swindon the works were made profitable in spite of having to carry large overheads for a long time. Furthermore, management and work force have come in for high praise from British Rail Engineering Ltd.

Given the right conditions, there could be ample work to keep open the workshops for a long time, if not permanently. In our view, it is not only the workshops where closures have been announced or those like Swindon which are under theat of closure which are endangered in the long term; there are others.

Mr. Harold Walker


Mr. Stoddart

There is Doncaster, as my right hon. Friend mentions, and Derby. They are all in the firing line. That is why there must be a concerted effort on the part of all the people in the railway workshops to resist the proposed closures.

I am concerned about Government policy in many respects. I am also concerned whether they plan to privatise completely BREL, although this would be operationally mad because British Rail could not allow its day-to-day running requirements to be subject to the whims of an outside private organisation. My guess is that the Government will not privatise directly but will do it by stealth.

There are other ways in which the Government could help their backers in private industry to the detriment of BREL and of the rail customer as well. Many nasty rumours are flying around that it is Government policy to hand over at least 50 per cent. of new build work to private firms, irrespective of cost, performance and quality. That would be completely unacceptable. If the Government insisted on a big proportion of new build work being handed over to private firms in the face of a lower tender from BREL, it would be a scandal of immense proportions and would fly in the face of what the Government declare to be their policy of free competition. I have tried through parliamentary questions to obtain an assurance on this point but have so far met with stonewalling answers. Perhaps in his reply the Minister would be good enough to state his policy on this.

On the future of the railways, the British Railways Board is often unfairly blamed for having no proper plan and no direction. The board works under an intolerable handicap since the Government and the country seem incapable of deciding exactly what sort of railway system we should have and how it should relate to total transportation policy and to the overall economy. That is not good enough. The railways cannot operate under those conditions.

It is vital to plan for an expanded, up-to-date railway system, geared to the needs of passenger and freight traffic. Hardly anyone would deny that it would make for an improved environment and better use of land and resources and would conserve energy if more freight were carried by rail. It cannot be achieved unless the railway network enables goods to be transported from factory to customer on the rails. Due to the relocation of industry and the closure of branch lines, this is impossible. Instead of closures, new lines should be opened. I hope that the Minister will recognise that.

Some people believe that road transport can meet most, if not all, of our transport needs for passengers and freight, but they are completely wrong and shortsighted in that belief. In the first place, many people do not own or have access to a car and they must be considered. Secondly, if car ownership in this county moves up to the level of ownership in Germany, France and Italy, and the Society of Motor Manufacturers and Traders achieves its objective of 2 million car sales per year in the United Kingdom, we shall soon literally run out of adequate road space to accommodate cars.

To build more roads, often duplicating existing trunk routes, would be wasteful and damaging to the environment. On the other hand, building railways would be cheaper and much more economic in land use, and would provide the safest of all means of travel as well as causing the least damage to the environment. So let us extend our railways and side by side with that modernise existing track and signalling systems and replace clapped-out rolling stock which travellers have to use.

A programme of expansion would not only save the workshops which it is proposed to close and those threatened with closure but would provide much work for many private firms. I am sorry that the hon. Member for Chippenham (Mr. Needham) is not here, because it would provide additional work for Westinghouse Brake and Signal Co. Ltd. of Chippenham, which has already lost jobs and is likely to lose more.

If we do all these things, we can save the railway workshops, provide the country with a first-class railway system, which it needs and deserves, help private industry and reduce unemployment.

6.16 pm
Mr. Stanley Cohen (Leeds, South-East)

I point out to the hon. Member for Huddersfield, West (Mr. Dickens), who referred to the textile industry, that I am as concerned about it as he is. I hope that he will be as concerned as I am about the subject we are discussing. If we consider the effect on employment, the social situation, exports and the economy, that will be enough to go on with. I shall be very brief because I know we are pushed for time. I am sorry that the spokesman for the Social Democratic party, the hon. Member for Newcastle upon Tyne, East (Mr. Thomas), is not here.

Mr. Ron Lewis

There is not one of them present.

Mr. Cohen

I am sorry that they are not here. We are not discussing this subject to try to achieve political advantage in Darlington. I am concerned about the industry.

I must declare my interest as the national treasurer of the Transport Salaried Staffs Association. I am concerned about the people I represent, about the industry itself and about its ability to serve the people. I repeat that I am sorry that the hon. Member for Newcastle upon Tyne, East is not present to hear what I have to say.

At Shildon there are 232 clerical staff employed in the workshops. They will be phased out and by 1984 there will be no clerical employment. Horwich has 234; 207 will be phased out, which will leave 27 at the end of 1984. Temple Mills will disappear, with 66 clerical staff and 230 shop men. Jobs will be reduced from 762 to 27, a reduction of 735.

I disagree with the figure of £5,000 a year, given by my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth), to keep someone unemployed. I reckon that the amount is nearer £8,000. If we take into account that the person is no longer paying a national insurance contribution or tax it is £7,000 to £8,000. Therefore, the nation is losing approximately £6 million a year. In other words, we will be paying people to be unemployed. It is distressing that we fail to give enough support to an industry which is very efficient. We confine the support to production within limited areas. In fact, the industry does not need to produce wagons just for the railways. Production could be greatly extended, but it has not been given the opportunity to extend it. It is appalling to close industries and create unemployment in the present economic and social circumstances.

I shall finish at that point, because I know that the Front Bench spokesmen wish to speak.

6.20 pm
Mr. Roger Stott (Westhoughton)

I was about to say that I was surprised—but perhaps I am not surprised—to see acres of empty Benches facing me.

Mr. Dickens

I am filling them.

Mr. Stott

Certainly the hon. Member for Huddersfield, West (Mr. Dickens) fills more than one place. It shows the way that Conservative Members feel about this important subject.

Mr. Cryer

And the SDP Benches.

Mr. Stott

My hon. Friend the Member for Keighley (Mr. Cryer) draws my attention to the fact that the alliance Benches, too, are completely bare.

Mr. Arthur Lewis


Mr. Stott

No, I shall not give way. I have only just started.

The subject of this debate is a further example of the industrial tragedy and human misery that have beset our nation for the past four years. The rigid application of an economic policy which has been pursued and propagated with an almost religious fanaticism by the zealots in Downing Street and the Treasury has devastated Britain's productive industry, it has produced the highest unemployment figures in Europe, it has blighted the future of a whole generation of young people, and it has single-handedly destroyed local communities throughout the land. Towns such as Corby, Shotton, Consett, Kirkby and Linwood have been closed down and their people have been sacrificed on the altar of monetarism.

This debate is about two more communities which have the sword of Damocles hanging over their heads—two towns which are inextricably linked by history and tradition with the railway community, and which are geographically situated in regions where unemployment is as high as it was in the 1930s. If these workshops close, the people of Shildon, the people of Horwich and the people of Temple Mills will be consigned to the scrapheap of unemployment with all the attendant misery that millions of our fellow citizens are having to endure.

Mr. Harold Walker

When my hon. Friend says that this debate is about Horwich, Shildon and Temple Mills, he should not overlook the fact that there are other towns which are heavily dependent on railway workshops and which are suffering badly from the consequences of reductions in areas where there is intolerably high unemployment.

Mr. Stott

My right hon. Friend makes a fair point. His workshop has been hit by redundancies. Work has been lost there, and if this Government remain in power it is likely to lose a lot more. However, this debate is about the closures that have been declared by British Rail.

I was talking about the demise that is facing this country. It need not happen, and it should not happen, because there is an alternative. My right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) and my hon. Friend the Member for Aberdeen, North (Mr. Hughes) and I have argued over the past three years that what British Rail needs is not inquiries by a Serpell-type committee that produces a fatuous series of stupid options; what British Rail and the nation need is more investment in our railway network to make it efficient, for both passengers and freight.

However, this Government, throughout their period of office, have made a systematic attack on the whole of public transport, and no more so than on British Rail. Every major investment programme that has been submitted—particularly the investment programme for electrification, and almost every other programme—has been butchered by the neanderthal crackpots who inhabit the Prime Minister's policy unit. The only contribution to the railway debate that has emanated from that Adam Smith appreciation society has been the pulling up of railway tracks, laying down tarmac, and turning them into roads. What an utterly stupid and irrelevant proposal. If one were to walk through the deepest recesses of their minds, I doubt whether one would get one's feet wet.

In spite of what the Government say about the investment ceiling for British Rail, they have forced the board to reduce investment expenditure by setting an external finance limit that embraces grant and external borrowing. The effect has been a reduction in investment. The hon. Member for Newcastle upon Tyne, East (Mr. Thomas) drew the attention of the Secretary of State to page 41 of the Serpell report, which clearly shows that there has been a fall in investment since 1979.

If we contrast what is happening in the United Kingdom with what other Governments are doing for their railway finances, it becomes abundantly clear that British Rail will continue to be characterised by low investment, low Government support and high fares. Almost every country in Europe is spending more money on modernising its railway network. For instance, Germany and France spend much more than we do, and their railway industries make a bigger loss than ours. Indeed, throughout the world railways are enjoying a renaissance. It is only here in Britain, the birthplace of railways, that we are witnessing what Sir Peter Parker calls the crumbling edge of quality. The Government seem to be totally indifferent to what is happening and are purposely contributing to the demise of the railways.

If the Secretary of State does not believe my right hon. Friend, and if he does not believe me, perhaps he will believe the British Railways Board about the need for investment. It produced a document on rail policy in 1981 entitled A statement by the British Railways Board of its policies and potential for the 1980s". It states: The watershed year is 1983. If major expenditure on replacement is not started by then the inevitable consequence will be a rapid rundown of the whole railway system. We could postpone until that date, continuing with some replacement and with much 'make do and mend' at present investment levels, but not beyond. In 1981 we must have started the design and planning work and have placed orders for materials if major re-equipment is to commence in 1983". The statistics that I am about to quote are not the figments of a partisan politician's imagination. I did not write them. They were written by the British Railways Board, and signed by every member of that hoard. A notable signature is that of Sir David Serpell. The document describes what would happen to the system if no investment was forthcoming. It says that track mileage withdrawn from traffic would be 3,000 and rising rapidly. It says that the mileage carrying temporary speed restrictions was 180 in 1981, and would rise to 800. It pointed out that the annual failure rate of mechanical signalling, then at 4 per cent., would be 10 per cent. and rising. Resultant annual duration of train delays, 5,000 hours, would rise to 8,500 hours. Availability of locos, now 75 per cent., would drop to 50 per cent. Electrical multiple units at 85 per cent. would drop to 75 per cent.

So the dismal picture continues. It is no longer the crumbling edge of quality; it is the decaying core of the network. If the Secretary of State does not believe the British Railways Board, perhaps he ought to consult—if they were here—some of his hon. Friends whose commuter constituents are subjected to clapped-out railway stock, delays, and cancellations.

If we are to rectify the appalling decline, something must be done now. The beneficiaries of more investment would be not only the passengers, the freight business and private industry but the railway workshops where the labour force, with its traditions and loyalties, is uniquely placed to take up this challenge. There are 3,103 diesel muliple units which require to be replaced nationally. British Rail suggests that up to 1,000 of them could be replaced by the class 141 lightweight unit. The remainder would be required to be replaced by either the class 210 or a new design to present-day standards. By any test, therefore, it is obvious that there is work to be done on building and refurbishment and that the work needs to be done now.

Of those 1,000 DMUs, 640 operate into or within passenger transport executive areas; 400 of them would be the financial allocation of the PTEs. If this programme of DMU replacement were to go ahead, the passenger transport executives collectively would have to find an additional £8.1 million in section 20 grants. As I understand it, the Department of Transport has accepted that rolling stock replacement could be introduced into the transport policies and plans and that the cost of the section 20 grant would perhaps be increased because of the replacement of that rolling stock. However, I contend that that is a meaningless gesture because any passenger transport executive would, if it increased its section 20 grants, be penalised under what has become universally known as the Heseltine clawback or the block grant penalties, and might even be penalised—this has still to be decided as we have had no satisfactory answer yet—under the Government's new protected levels of expenditure introduced in the latest Transport Bill.

Having spoken to a number of people in passenger transport executives this morning, I can say that, apart from south Yorkshire where some work is going on, there is no sign that the Government are making finance available for the replacement of these vehicles.

We do not accept that the closure of the workshops is necessary, given that there is an unanswerable case, certainly in logic, for productive, non-inflationary investment in British Rail. We do not accept that there is a case for closure.

My hon. Friend the Member for Bishop Auckland (Mr. Foster), in a moving speech this afternoon, has left the House in no doubt about the consequences of the closure of the Shildon works. Behind the statistics lies a considerable sum of human misery which will face hundreds of families who depend on that workshop for their livelihood. Like my hon. Friend the Member for Glasgow, Springburn (Mr. Martin), I live in the constituency that I represent. In Horwich the picture is just the same. For the past 10 years I have had the honour and pleasure of representing the people of Horwich in the House. I know them well. I know what they have done. I have been round that workshop regularly. I know the efforts that have been made to increase productivity, to become efficient, to slim down, and to achieve craft interchangeability in order to meet the challenges of the future. I know that they are efficient, I know that they are hardworking and I know that they want to keep that workshop open.

In the town there are people working in the railway industry whose families have been attached to it for a generation. One family in four is associated with the workshops. There has been a railway workshop in the town since the beginning of the last century, making wagons and locomotives, repairing carriages and even, during the second world war, making tanks. Thousands of young men have been given an apprentice training in the vital skills of engineering. Currently 214 apprentices are employed at the Horwich loco works. Virtually no other organisation in the north-west region, apart from British Rail and British Aerospace, has provided engineering apprenticeships. Almost everyone on the plant is a time-served craftsman: sheet metal workers, boilermakers, coppersmiths, joiners, electricians, fitters and turners. The seed corn of British industry is about to be thrown on the scrapheap as part of the manic economic experiment being conducted by this Government.

If the closure were to take place, unemployment in my town would go up to 46 per cent. My hon. Friends the Members for Bolton, East (Mr. Young), for Bolton, West (Mrs. Taylor) and for Bury and Radcliffe (Mr. White), who served his apprenticeship at Horwich loco works, have been closely involved in the prospective closure. We have attended meetings with the local authority and we have set up a team of people to look into the consequences of closure. My hon. Friend the Member for Bolton, East has spelt out those consequences and has shown that the total loss at BREL at Norwich will be £2,873,000. The cost to public funds of closing that workshop would, however, amount to £4 million in the first year. What a way to run a country, by putting people out of work, by creating higher unemployment and by having to pay for it from the national exchequer.

The Prime Minister always talks about freedom of choice. What freedom of choice have the people of Shildon, of Temple Mills or of my own town? They have none. They will go on to the scrapheap of unemployment. If they were given freedom of choice, they would choose to work. Nevertheless, they will have a choice, either this year or next. Together with the rest of the British people they will be given the choice of voting for a party that will keep the workshops open and that will vigorously pursue an alternative economic policy and put our people back to work.

That is why we shall go into the Lobby tonight not just in defence of jobs at Shildon, Horwich and Temple Mills but to demonstrate to the country that the Labour party is the only party committed to improving and modernising our railway network. I ask my right hon. and hon. Friends to join me in the Lobby to demonstrate that commitment.

6.39 pm
The Under-Secretary of State for Transport (Mr. Reginald Eyre)

Before replying to some of the misconceptions and even misrepresentations that have been heard in the debate, I wish to explain once again the real reasons why British Rail Engineering Ltd. and British Rail have taken these decisions with regard to Shildon, Horwich and Temple Mills.

The hon. Member for Westhoughton (Mr. Stott) ranged widely in his speech and made some unjustifiable accusations. I shall not pursue those accusations. I wish to deal with the issues affecting Shildon, Horwich and Temple Mills. They are important to our understanding of what is happening in our industrial areas as new products and new processes replace the old.

Mr. Arthur Lewis

The Minister has been an honourable Member for a long time. Has it not always been the custom and practice for the parties to be represented in the Chamber, at least for the ministerial reply? Will the hon. Gentleman put on record that, during the whole of the debate, not one Liberal Member has been in attendance and that the hon. Member for Newcastle upon Tyne, East (Mr. Thomas) has been the only Social Democratic party Member present? Is it not time that these parties carried out the normal practice of ensuring that their representatives are present to hear the Minister's winding-up speech?

Mr. Eyre

I appreciate the importance of the point made by the hon. Gentleman.

I want to relate my reply to the questions posed by the hon. Member for Bishop Auckland (Mr. Foster) and to the points made by the hon. Member for Newcastle upon Tyne, East (Mr. Thomas) and by my hon. Friend the Member for Hastings (Mr. Warren).

Ten years ago, British Rail's freight business required 220,000 wagons. They were the old-fashioned vacuum-braked wagons. The wagons had a relatively short life and needed a lot of maintenance. Since then the rail freight business has been revolutionised. With the introduction of the TOPS computer system and the adoption of larger wagons, the number of wagons needed to carry the same amount of traffic has been drastically reduced. Even by 1982 the total number of wagons needed had fallen to 70,000.

During the past decade British Rail has been re-equipping with the modern air-braked wagons built at BREL. By 1982, it had 22,000 of those wagons. In addition, many companies had invested in their own wagons, of which there were perhaps 18,000 in use on the railways. In all, therefore, the rail freight business now has new wagon equipment. Mostly, it is well under 10 years old. British Rail's investment is perhaps worth £500 million. These are important practical facts in understanding the problem.

British Rail has increasingly found that it can no longer operate competitively with the old wagonload style of operation. It has decided to withdraw entirely from that activity by 1984. It intends to carry all traffic either in train loads or by the modern timetabled Speedlink system. These dramatic changes have been important in contributing to the efficiency and competitiveness of rail freight. I understand the emphasis placed by the right hon. Member for Barrow-in-Furness (Mr. Booth) and others on the need for British Rail to be competitive in rail freight. The changes carry with them the reasons for the rapid decline in the work load for wagon builders and repairers. The air-braked wagons are more robust and can be expected to have a working life of more than 20 years. They are all relatively new and will not need replacement for many years. The old wagons are being rapidly phased out, so there remains little repair work load in respect of them.

Hon. Members must also recognise that the modern wagon fleet gains its efficiency from intensive use. Each wagon costs much the same as a heavy lorry. It is not the sort of equipment that can be left standing in sidings as additional storage capacity for the customer, which is the kind of thing that we all remember from the railways of the past.

Mr. Mike Thomas

I accept that argument, as I stated in my speech. However, the Government must take responsibility for the fact that the volume of freight transport, which amounted to 171 million tonnes in 1978, is down to 141 million tonnes in 1982, due partly to the recession but also to the policies of the Government.

Mr. Eyre

The hon. Gentleman fairly related a great deal of that reduction to the world recession. One also has to recognise, as I do coming from the industrial area of Birmingham, that there has been a structural change in the nature of industry that affects the demand for steel. These are complicated factors with which I shall be dealing shortly.

The changes that the railways are making to face the challenges of the modern world must be welcome to all hon. Members. The re-equipping is now virtually complete. One can see the trend emerging by looking at the number of wagons that BREL has built in recent years. In 1981, it built nearly 2,000. In 1982, the figure was just under 1,000. This year it is expected to be below 100. For the next few years, British Rail envisages a need for only about 150 new wagons a year, depending on the amount of additional traffic it can win. Yet, at Shildon alone, British Rail has the capacity to build 1,500 wagons a year. [Interruption.] Plans are made, but they have to change according to the circumstances affecting them. I have tried to explain the dramatic technological change occurring in the railways.

Mr. Foster

Will the Minister answer the question that I asked: what is the latest forecast for the growth of the private sector fleet between now and 1986? During the last round of rail talks, the figure was envisaged to be 6,000. That figure represents four years' work for the Shildon work force.

Mr. Eyre

I understand that the estimate for the private rail fleet is about 300 a year. I hope that that information helps the hon. Gentleman.

I wish to deal now with maintenance and repairs where the effects on the work load have been nearly as dramatic. In 1981, the repair work load was nearly 15,000 wagons. This year, because of the technical changes that I have described, it will be just over 8,000 wagons. Next year, when the wagon load traffic stops, for railway reasons which I understand—it is the right action for the future—it will be smaller still. British Rail Engineering Ltd. as a whole still has the capacity to build more than 2,000 wagons a year and the capacity to repair 20,000 wagons. There is no way of avoiding the fact that a vast disparity exists between what it can supply and what its customer, British Rail, can actually use. I wish to emphasise this point. It was made by my right hon. Friend the Secretary of State in his opening speech. It is, however, clear from the speeches that have been made that hon. Members have not fully absorbed the implications of this technical change.

The problem is not that BREL's workshops are out of date or inefficient but that the modern freight business uses it wagons more efficiently. The result is that fewer new wagons and less repair work are needed. I ask hon. Members to put themselves in the position of the managers of BREL. They have very difficult decisions to make. What options do they face in that situation?

The serious point made by the hon. Member for Newcastle upon Tyne, East—his preservation suggestion about a two-year period for Shildon—sounded plausible, but it is not realistic against the background that I am describing in detail in an attempt to answer the hon. Gentleman's question. Not only that, but the hon. Gentleman's suggestion carries dangers for the other jobs in BREL. I shall come to that later.

Mr. Mike Thomas

The question I asked the Secretary of State does not seem to have been answered adequately, if I understand the hon. Gentleman correctly. If this is such an unsatisfactory idea, why was it put forward by the BREL management on 9 March and discussed with the NUR, when I assume it moved towards agreement?

Mr. Eyre

My right hon. Friend made it quite clear that the Government have not been involved in any way with management decisions. I can only say to the hon. Gentleman that, to my knowledge, no one in management was entitled to put forward any view of that kind. I can only assume that it was not put forward officially.

Mr. Thomas

The hon. Gentleman cannot have it both ways. Either the management is running the company and put it forward on its own account—which we do not believe, but that is what the hon. Gentleman tells us—or the management is not responsible and only put forward the idea unofficially because the Minister did not approve it.

Mr. Eyre

The hon. Gentleman was suggesting earlier that a reprieve had been put forward. As I understand it, there were some negotiations between management, operating in its own right as management, and the unions about the rate of rundown, but it did not amount to a reprieve in the terms that the hon. Gentleman was describing. I shall not be drawn more than that. I have tried to explain the position with regard to management. I cannot be responsible for any misunderstandings that the hon. Gentleman may have about what went on at a lower level.

I turn now to the points that hon. Members have raised in the debate. Right hon. and hon. Members have quite properly asked why these workshops are being closed by BREL. I admit that these are sad decisions. I was conscious of the remarks made about local communities by the hon. Members for Westhoughton and for Bolton, East (Mr. Young), who emphasised again the difficulties in that situation. I want to set out BREL's reasons for these hard and difficult decisions.

First, with regard to Shildon, I agree very much with the remarks made by the right hon. Member for Barrow-in-Furness about the co-operation of the work force. This is a single-purpose works with a capacity to build 1,500 wagons a year and to repair 15,000 wagons a year. We have to compare this with a work load in the coming years which is expected to be only 150 new wagons, with maintenance of 7,000 to 8,000 wagons a year. This reduced work load can be handled by the multipurpose works at Doncaster with their present capacity.

Mr. Booth

I understood the hon. Gentleman to be talking about British Rail running down its wagon fleet to about 30,000 or 31,000. If Shildon were on a rebuild programme of only 150 wagons a year, that would be equivalent to replacing wagons every two centuries. Does the hon. Gentleman think that is a serious scenario?

Mr. Eyre

The right hon. Gentleman must take account of all the factors that I have mentioned, which the BREL management is doing. There is this great stock build-up of new wagons. The replacement programme takes account of that existing stock, which has to be distributed among the BREL workshops throughout the country. The BREL management is doing those calculations very carefully and responsibly. That is the reasoning that has led to these decisions.

The next sad decision relates to Horwich, where the situation is somewhat different. Horwich has only a limited work load of its own, and this has been topped up with overspill from Eastleigh and Wolverton. The more modern electrical multiple units which are to be introduced soon into the Manchester-Bury and Liverpool-Southport services have traditionally been maintained at Eastleigh. To maintain this modern rolling stock, which is to be built up at Horwich, would require duplication of maintenance facilities and stockholding. Both Eastleigh and Wolverton have sufficient capacity to handle all their own traditional work loads, so they no longer have surplus work to send to Horwich. BREL has therefore concluded that to keep the Horwich works open would mean wasteful duplication of facilities and overhead costs.

Like Shildon, Temple Mills is a single-purpose works repairing wagons and containers. Here I should say that I am grateful to the hon. Member for Newham, North-West (Mr. Lewis) for the tributes that he paid to war-time railwaymen. The Temple Mills work force has been reduced to 310, and the work load this year has failed to provide work for this number.

I appreciate the speech of my hon. Friend the Member for Huddersfield, West (Mr. Dickens). The Government are deeply concerned about the social consequences of any major closure of a business, whether it be a British Rail workshop or a private sector works. There are many ways in which Government Departments and agencies will be helping in the task of creating opportunities for new employment in the areas concerned.

Mr. Arthur Lewis


Mr. Eyre

The hon. Gentleman must forgive me if I do not give way. I have only a few minutes left.

I say to the hon. Member for Bishop Auckland that BREL has made it clear that it wishes to work through the local enterprise trusts with the local authorities and private firms to help in the process of creating new opportunities and work. Government Departments and agencies stand ready to play their part in tackling the difficult problems that these closures will create. They will need to cooperate and co-ordinate their activities with the local authorities, British Rail and private firms. That process can only start in earnest once it has been generally accepted that the railway workshops have to close. In these sad and difficult circumstances, I must say that Opposition parties are acting against the interests of local communities by pretending that solutions exist, thus delaying the positive work that others are ready to start in order to tackle the problems that follow from these decisions.

In the circumstances, I urge the House to reject the Opposition motion and to support the Government amendment.

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

The House divided: Ayes 209, Noes 280.

Division No. 96] [7 pm
Abse, Leo Benn, Rt Hon Tony
Alton, David Bennett, Andrew(St'kp't N)
Anderson, Donald Bidwell, Sydney
Archer, Rt Hon Peter Booth, Rt Hon Albert
Ashley, Rt Hon Jack Boothroyd, Miss Betty
Ashton, Joe Bottomley, Rt Hon A.(M'b'ro)
Atkinson, N. (H'gey,) Bray, Dr Jeremy
Barnett, Guy (Greenwich) Brocklebank-Fowler, C.
Barnett, Rt Hon Joel (H'wd) Brown, Hugh D. (Provan)
Brown, Ronald W. (H'ckn'y S) Kaufman, Rt Hon Gerald
Brown, Ron (E'burgh, Leith) Kerr, Russell
Buchan, Norman Kilroy-Silk, Robert
Callaghan, Rt Hon J. Lambie, David
Campbell, Ian Lamond, James
Campbell-Savours, Dale Leadbitter, Ted
Canavan, Dennis Leighton, Ronald
Cant, R. B. Lestor, Miss Joan
Carmichael, Neil Lewis, Arthur (N'ham NW)
Carter-Jones, Lewis Lewis, Ron (Carlisle)
Cartwright, John Litherland, Robert
Clark, Dr David (S Shields) Lofthouse, Geoffrey
Clarke,Thomas(C'b'dge, A'rie) Lyon, Alexander (York)
Cocks, Rt Hon M. (B'stol S) Lyons, Edward (Bradf'd W)
Cohen, Stanley Mabon, Rt Hon Dr J. Dickson
Coleman, Donald McDonald, Dr Oonagh
Concannon, Rt Hon J. D. McElhone, Mrs Helen
Cook, Robin F. McKay, Allen (Penistone)
Craigen, J. M, (G'gow, M'hill) McKelvey, William
Crawshaw, Richard MacKenzie, Rt Hon Gregor
Crowther, Stan McTaggart, Robert
Cryer, Bob Magee, Bryan
Cunliffe, Lawrence Marshall, D(G'gow S'ton)
Cunningham, G. (Islington S) Marshall, Dr Edmund (Goole)
Dalyell, Tam Marshall, Jim (Leicester S)
Davidson, Arthur Martin, M(G'gow S'burn)
Davies, Rt Hon Denzil (L'lli) Mason, Rt Hon Roy
Davis, Clinton (Hackney C) Maxton, John
Davis, Terry (B'ham, Stechf'd) Maynard, Miss Joan
Deakins, Eric Mikardo, Ian
Dean, Joseph (Leeds West) Millan, Rt Hon Bruce
Dixon, Donald Mitchell, R. C. (Soton Itchen)
Dobson, Frank Morris, Rt Hon A. (W'shawe)
Dormand, Jack Morris, Rt Hon C. (O'shaw)
Douglas, Dick Morton, George
Dubs, Alfred Moyle, Rt Hon Roland
Duffy, A. E. P. Newens, Stanley
Dunnett, Jack Oakes, Rt Hon Gordon
Dunwoody, Hon Mrs G. Ogden, Eric
Eadie, Alex O'Halloran, Michael
Eastham, Ken O'Neill, Martin
Ellis, R. (NE D'bysh're) Orme, Rt Hon Stanley
Ellis, Tom (Wrexham) Palmer, Arthur
English, Michael Park, George
Evans, John (Newton) Parker, John
Ewing, Harry Parry, Robert
Field, Frank Pavitt, Laurie
Flannery, Martin Pendry, Tom
Foot, Rt Hon Michael Penhaligon, David
Ford, Ben Pitt, William Henry
Forrester, John Powell, Raymond (Ogmore)
Foster, Derek Prescott, John
Foulkes, George Price, C. (Lewisham W)
Fraser, J. (Lamb'th, N'w'd) Race, Reg
Freeson, Rt Hon Reginald Rees, Rt Hon M (Leeds S)
Freud, Clement Richardson, Jo
Garrett, John (Norwich S) Roberts, Albert (Normanton)
Gilbert, Rt Hon Dr John Roberts, Allan (Bootle)
Golding, John Roberts, Ernest (Hackney N)
Grant, John (Islington C) Roberts, Gwilym (Cannock)
Hamilton, W. W. (C'tral Fife) Robinson, G. (Coventry NW)
Harrison, Rt Hon Walter Rooker, J. W.
Hattersley, Rt Hon Roy Roper, John
Haynes, Frank Ross, Ernest (Dundee West)
Holland, S. (L'b'th, Vauxh'll) Ross, Stephen (Isle of Wight)
Home Robertson, John Rowlands, Ted
Hooley, Frank Ryman, John
Howell, Rt Hon D. Sandelson, Neville
Howells, Geraint Sever, John
Hoyle, Douglas Sheldon, Rt Hon R.
Huckfield, Les Shore, Rt Hon Peter
Hudson Davies, Gwilym E. Short, Mrs Renée
Hughes, Roy (Newport) Silkin, Rt Hon J. (Deptford)
Hughes, Simon (Bermondsey) Silkin, Rt Hon S. C. (Dulwich)
Janner, Hon Greville Skinner, Dennis
Jay, Rt Hon Douglas Snape, Peter
John, Brynmor Soley, Clive
Johnson, James (Hull West) Spearing, Nigel
Johnson, Walter (Derby S) Spellar, John Francis (B'ham)
Jones, Dan (Burnley) Spriggs, Leslie
Stallard, A. W. Welsh, Michael
Steel, Rt Hon David White, Frank R.
Stoddart, David White, J. (G'gow Pollok)
Stott, Roger Whitehead, Phillip
Straw, Jack Whitlock, William
Summerskill, Hon Dr Shirley Wigley, Dafydd
Taylor, Mrs Ann (Bolton W) Willey, Rt Hon Frederick
Thomas, Jeffrey (Abertillery) Williams, Rt Hon A (S'sea W)
Thomas, Mike (Newcastle E) Wilson, William (C'try SE)
Thomas, Dr R.(Carmarthen) Winnick, David
Tilley, John Woodall, Alec
Torney, Tom Wright, Sheila
Varley, Rt Hon Eric G. Young, David (Bolton E)
Wainwright, E.(Dearne V)
Wainwright, R.(Colne V) Tellers for the Ayes:
Walker, Rt Hon H.(D'caster) Mr. James Hamilton and
Watkins, David Mr. Norman Hogg.
Weetch, Ken
Alexander, Richard Dickens, Geoffrey
Alison, Rt Hon Michael Dorrell, Stephen
Amery, Rt Hon Julian Douglas-Hamilton, Lord J.
Ancram, Michael Dover, Denshore
Arnold, Tom du Cann, Rt Hon Edward
Aspinwall, Jack Dunn, Robert (Dartford)
Atkins, Rt Hon H.(S'thorne) Durant, Tony
Atkins, Robert(Preston N) Dykes, Hugh
Baker, Kenneth(St.M'bone) Eden, Rt Hon Sir John
Baker, Nicholas (N Dorset) Edwards, Rt Hon N. (P'broke)
Banks, Robert Eggar, Tim
Beaumont-Dark, Anthony Emery, Sir Peter
Bendall, Vivian Eyre, Reginald
Benyon, Thomas (A'don) Fairbairn, Nicholas
Benyon, W. (Buckingham) Fairgrieve, Sir Russell
Berry, Hon Anthony Faith, Mrs Sheila
Best, Keith Farr, John
Bevan, David Gilroy Finsberg, Geoffrey
Biffen, Rt Hon John Fisher, Sir Nigel
Biggs-Davison, Sir John Fletcher, A. (Ed'nb'gh N)
Blackburn, John Fletcher-Cooke, Sir Charles
Body, Richard Fookes, Miss Janet
Bonsor, Sir Nicholas Forman, Nigel
Bottomley, Peter (W'wich W) Fowler, Rt Hon Norman
Bowden, Andrew Fraser, Rt Hon Sir Hugh
Boyson, Dr Rhodes Fraser, Peter (South Angus)
Braine, Sir Bernard Fry, Peter
Bright, Graham Gardiner, George (Reigate)
Brinton, Tim Gardner, Sir Edward
Brittan, Rt. Hon. Leon Garel-Jones, Tristan
Brooke, Hon Peter Gilmour, Rt Hon Sir Ian
Brotherton, Michael Glyn, Dr Alan
Brown, Michael(Brigg & Sc'n) Goodhart, Sir Philip
Bruce-Gardyne, John Goodlad, Alastair
Bryan, Sir Paul Gorst, John
Buchanan-Smith, Rt. Hon. A. Gow, Ian
Buck, Antony Gower, Sir Raymond
Budgen, Nick Gray, Rt Hon Hamish
Burden, Sir Frederick Greenway, Harry
Butcher, John Griffiths, E.(B'y St. Edm'ds)
Carlisle, John (Luton West) Griffiths, Peter (Portsm'th N)
Carlisle, Kenneth (Lincoln) Grist, Ian
Carlisle, Rt Hon M. (R'c'n) Grylls, Michael
Chalker, Mrs. Lynda Gummer, John Selwyn
Channon, Rt. Hon. Paul Hamilton, Hon A.
Chapman, Sydney Hamilton, Michael (Salisbury)
Churchill, W. S. Hampson, Dr Keith
Clark, Hon A. (Plym'th, S'n) Hannam, John
Clark, Sir W. (Croydon S) Haselhurst, Alan
Clarke, Kenneth (Rushcliffe) Hastings, Stephen
Clegg, Sir Walter Havers, Rt Hon Sir Michael
Cockeram, Eric Hawkins, Sir Paul
Colvin, Michael Hawksley, Warren
Cope, John Hayhoe, Barney
Cormack, Patrick Heath, Rt Hon Edward
Corrie, John Heddle, John
Costain, Sir Albert Henderson, Barry
Cranborne, Viscount Hicks, Robert
Critchley, Julian Higgins, Rt Hon Terence L.
Crouch, David Hogg, Hon Douglas (Gr'th'm)
Holland, Philip (Carlton) Mawby, Ray
Hooson, Tom Maxwell-Hyslop, Robin
Hordern, Peter Mayhew, Patrick
Howe, Rt Hon Sir Geoffrey Meyer, Sir Anthony
Howell, Rt Hon D. (G'ldf'd) Miller, Hal (B'grove)
Howell, Ralph (N Norfolk) Mills, Iain (Meriden)
Hunt, David (Wirral) Mills, Sir Peter (West Devon)
Hunt, John (Ravensbourne) Miscampbell, Norman
Hurd, Rt Hon Douglas Moate, Roger
Irvine, RtHon Bryant Godman Monro, Sir Hector
Irving, Charles (Cheltenham) Montgomery, Fergus
Jenkin, Rt Hon Patrick Moore, John
Jopling, Rt Hon Michael Morgan, Geraint
Joseph, Rt Hon Sir Keith Morris, M. (N'hampton S)
Kaberry, Sir Donald Morrison, Hon C. (Devizes)
Kellett-Bowman, Mrs Elaine Morrison, Hon P. (Chester)
Kershaw, Sir Anthony Mudd, David
Kimball, Sir Marcus Murphy, Christopher
King, Rt Hon Tom Myles, David
Kitson, Sir Timothy Neale, Gerrard
Knight, Mrs Jill Needham, Richard
Knox, David Nelson, Anthony
Lang, Ian Neubert, Michael
Langford-Holt, Sir John Newton, Tony
Latham, Michael Normanton, Tom
Lawrence, Ivan Onslow, Cranley
Lee, John Oppenheim, Rt Hon Mrs S.
Le Marchant, Spencer Page, John (Harrow, West)
Lennox-Boyd, Hon Mark Page, Richard (SW Herts)
Lester, Jim (Beeston) Parris, Matthew
Lewis, Sir Kenneth (Rutland) Patten, Christopher (Bath)
Lloyd, Ian (Havant & W'loo) Pawsey, James
Lloyd, Peter (Fareham) Percival, Sir Ian
Loveridge, John Pink, R. Bonner
Luce, Richard Pollock, Alexander
Lyell, Nicholas Porter, Barry
McCrindle, Robert Prentice, Rt Hon Reg
Macfarlane, Neil Price, Sir David (Eastleigh)
MacGregor, John Proctor, K. Harvey
MacKay, John (Argyll) Raison, Rt Hon Timothy
Macmillan, Rt Hon M. Rathbone, Tim
McNair-Wilson, M. (N'bury) Rees, Peter (Dover and Deal)
McNair-Wilson, P. (New F'st) Rees-Davies, W. R.
McQuarrie, Albert Renton, Tim
Major, John Rhodes James, Robert
Marland, Paul Rhys Williams, Sir Brandon
Marten, Rt Hon Neil Ridley, Hon Nicholas
Mates, Michael Ridsdale, Sir Julian
Maude, Rt Hon Sir Angus Rifkind, Malcolm
Rippon, Rt Hon Geoffrey Thompson, Donald
Roberts, Wyn (Conway) Thorne, Neil (Ilford South)
Rossi, Hugh Thornton, Malcolm
Rost, Peter Townend, John (Bridlington)
Royle, Sir Anthony Townsend, Cyril D, (B'heath)
Rumbold, Mrs A. C. R. Viggers, Peter
Sainsbury, Hon Timothy Waddington, David
St. John-Stevas, Rt Hon N. Waldegrave, Hon William
Scott, Nicholas Walker, Rt Hon P.(W'cester)
Shaw, Sir Michael (Scarb') Walker, B. (Perth)
Shelton, William (Streatham) Walker-Smith, Rt Hon Sir D.
Shepherd, Colin (Hereford) Wall, Sir Patrick
Shepherd, Richard Waller, Gary
Silvester, Fred Walters, Dennis
Sims, Roger Ward, John
Skeet, T. H. H. Warren, Kenneth
Smith, Tim (Beaconsfield) Watson, John
Speller, Tony Wells, Bowen
Spence, John Wells, John (Maidstone)
Spicer, Jim (West Dorset) Wheeler, John
Sproat, Iain Whitelaw, Rt Hon William
Squire, Robin Whitney, Raymond
Stainton, Keith Wickenden, Keith
Stanbrook, Ivor Wiggin, Jerry
Stanley, John Williams, D.(Montgomery)
Steen, Anthony Winterton, Nicholas
Stewart, A.(E Renfrewshire) Wolfson, Mark
Stewart, Ian (Hitchin) Young, Sir George (Acton)
Stradling Thomas, J. Younger, Rt Hon George
Tapsell, Peter
Tebbit, Rt Hon Norman Tellers for the Noes:
Temple-Morris, Peter Mr. Carol Mather and
Thomas, Rt Hon Peter Mr. Robert Boscawen.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 32 (Questions on amendments), and agreed to.

MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved, That this House recognises the need for British Rail Engineering Limited to rationalise its workshop capacity in the light of changed requirements; and supports vigorous and constructive measures by all concerned to promote alternative and durable employment in the areas affected.