Scottish Economy

HC Deb 29 November 1983 vol 49 cc772-857

4.5 pm

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

I beg to move, That this House welcomes the remarkable progress made in restructuring and strengthening the Scottish economy through the emergence of innovative new firms, the attraction of high technology investment, the growth of financial and business services, the seizing of the industrial opportunities afforded by North Sea oil, and the modernisation of traditional industries, thus equipping Scottish industry to compete more effectively in home and overseas markets; and the major initiatives by the Government in improving the training system so that all unemployed may take full advantage of these new opportunities.

Mr. Speaker

I have selected the amendment in the name of the Leader of the Opposition.

Mr. Younger

This is the first occasion on which I have had any opportunity, in debate at any rate, to congratulate the hon. Member for Glasgow, Garscadden (Mr. Dewar) on taking on his new responsibilities on the Opposition Front Bench. I have no doubt that we shall have many fierce arguments, but within the limits of what is possible through the usual channels I am sure that we can organise Scottish business in a way that finds acceptability. Whether Scotland will take quite such a view, or will feel that it is getting a somewhat restricted choice in the matter by either a Younger or a Dewar, I am not sure. In any case, I welcome the hon. Gentleman and his team.

The hon. Gentleman will not have to do his job alone, I understand, as he has help coming. The Glasgow Herald on Friday reported that splendid and outspoken lady Helen Liddell announcing that she would take the Scottish Labour party back to class, and would teach them. I am not quite sure what the teaching would be, but its objective was said to be to bring the Scottish Labour party into the latter years of the 20th century. If she succeeds, she will get a warm welcome from those of us who have been in the 20th century for quite a long time.

The motion is an optimistic one, and deliberately so. The picture of the Scottish economy that is often painted is becoming out of date. Too many prophets of doom predict Scotland as nothing but a depressed area, in the grip of industrial decline, with a population quite incapable of seizing the initiative and starting up businesses on its own. This is not a true or realistic description of the Scottish economy today. When the House considers the true facts, even the most gloomy of commentators will be forced to acknowledge the progress that Scotland has made towards establishing itself on a sounder economic base. It has been doing so through the worst international recession that any of us can remember.

We begin from the premise that unemployment is undeniably a major problem. It is of great concern to all of us in the House, but it in no way diminishes our concern to say that we need to be realistic about it. There can be no quick or easy solution, as indeed every other industrial country is discovering. From the very outset we have put the view that a sustainable reduction in Scottish unemployment would require not only a sound national economy, but a patient, long-term effort to widen and strengthen the very heart of our economy. Towards this end we introduced over the life of the last Parliament a whole battery of measures, all of which are influencing, and will continue to influence in positive ways, our economic well-being. That we are already seeing results from these efforts will become much clearer in the course of this debate.

Let us consider what it means to say that a country has a sound economic base. A nation's economic base can be described as that particular mix of activities from which its income and wealth are generated. The more suited that structure is to the requirements of the modern industrial world, the more effective it will be in providing an acceptable and growing standard of living for that country's inhabitants.

The economic base of a country is not a static thing. As hon. Members know, the pace of technological advance is more rapid than ever, international competition is fierce, and consumer tastes and habits are changing fast. To be successful in these circumstances, therefore, an economy must above all be adaptable. It must undergo a continual process of restructuring to take advantage of the new opportunities arising in a dynamic situation.

To do this, an economy needs several resources. The basic industrial mix must be right with due representation from both manufacturing and the service sectors. Entrepreneurial flair is also needed. So, too, is a skilled and adaptable work force. The back-up of sound financial institutions is vital and, of course, there must be the right background to the economy as a whole.

Mr. John Maxton (Glasgow, Cathcart)

rose——

Mr. Younger

I must press on for the moment.

Let us consider how far Scotland's economy matches up to those criteria. First, there is our industrial mix. The prophets of doom that I mentioned earlier still look back to the days when Scotland led the world in heavy engineering, steel, and shipbuilding. I fully acknowledge that last century these industries were at the heart of the economy, but it is many years now since that has been so. Not just recently, but throughout much of this century, employment in those industries has been in decline. We cannot, therefore, rely on looking back to the past. Instead, I want to highlight the extent to which many of our traditional industries have succeeded in keeping pace with the times. I want to refer also to the way in which new sources of employment have grown, quite naturally, to take the place of others which have declined.

I will start with North sea oil. That is a perfect example of the relationship between adaptability and economic opportunity. North sea oil and gas are currently responsible for providing directly and indirectly some 100,000 jobs in Scotland. Many of those jobs are in quite new activities directly concerned with extraction of the oil, but many have arisen in our more traditional sectors which have adapted to meet the challenge of supplying an entirely new type of industry. For example, the Wood Group in Aberdeen has greatly expanded its engineering interests with the advent of oil development. The Wimpey Construction Company has expanded from mainly house and office building to construction on the scale required at Sullom Voe and Nigg. Seaforth Maritime, a major supplier of offshore services, started as a tug company; and Aberdeen airport has become the second busiest airport in the United Kingdom, after Heathrow.

Mr. Gordon Wilson (Dundee, East)

rose——

Mr. Younger

I shall give way in a moment. Another piece of welcome news in this context is that Herreema's Lewis offshore yard at Amish Point has won only this week an order for the Esmond field, and that is expected to provide work for the 340 workers well into next year.

Mr. Wilson

I accept that certain parts of the country have done very well out of oil developments directly related to production, exploration and development, but will the Secretary of State admit that for the greater part of Scotland, including those areas where the population is congested, there have been virtually no industrial benefits, and that for Scotland as a nation the greatest benefit would be to have a share of the £9 billion that will go into the Treasury this year?

Mr. Younger

I do not agree with either of the hon. Gentleman's statements. It is not true to say that North sea oil benefits are concentrated in the north-east. There are many of them elsewhere in Scotland. Secondly, the hon. Gentleman said that Scotland expected to get a more that proportionate share of oil revenues. That is precisely what it gets now. Under every heading of public expenditure, almost bar none, Scotland gets more per head than any other part of the United Kingdom. I thought that the hon. Gentleman knew that.

The measures announced in the last Budget were designed to encourage the continued development of the North sea, and there has been a welcome response by the oil industry, with renewed interest in the United Kingdom continental shelf.

Mr. Dick Douglas (Dunfermline, West)

Does the right hon. Gentleman concede that in the Government's economic thinking there is a great deal of reliance on the stability of oil prices? What view does he take on the matter?

Mr. Younger

The hon. Gentleman is quite right. Violent fluctuations in oil prices, either upwards or downwards, create great problems for all economies. As for the view that I take, my right hon. friend the Secretary of State for Energy said in the House only last week at Question Time that it was difficult to predict the course of events with our prices, but that at the moment they were reasonably stable. I go no further than that.

We shall come to growth sectors later, and they are important, but there has been a welcome response by the oil industry, with renewed interest in the United Kingdom continental shelf. A number of new developments have already been announced, and other potential developments are under review. For example, in July, the line connecting the Northern Leg fields to the Brent system became operational. The development of North Alwyn will use links to the Frigg system, and there are now plans for a line from Fulmar to St. Fergus. That, I think, is the answer to those who thought that when the gas gathering pipeline was abandoned nothing further would happen. Clearly much is happening, and the people who thought that were wrong.

Next I shall mention banking, insurance and the finance sector.

Mr. George Foulkes (Carrick, Cumnock and Doon Valley)

rose——

Mr. Tam Dalyell (Linlithgow)

rose——

Mr. Younger

There is a richness of choice here.

Mr. Speaker

Perhaps the Secretary of State will make a decision.

Mr. Younger

I think that the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) was first.

Mr. Foulkes

I am grateful to the Secretary of State. Before he leaves the subject of oil, is he aware of the statement that was made at the Ayr chamber of commerce by Gerry Frew, the director of ALERT the local enterprise trust, when he said that property speculators in Ayrshire are holding on to empty property and jeopardising any industrial recovery because they are waiting for an oil boom? Is he aware that Mr. Ewen McHarg, the chairman of the Ayr chamber of commerce, said that the cause is that no fixed date has been given for the granting of licences in the Clyde for oil exploration? Will the right hon. Gentleman therefore tell us when there is to be an announcement about oil exploration in the Clyde, because the uncertainty affects the right hon. Gentleman's constituency as well as mine?

Mr. Younger

I would never take the view that something affecting the region of Ayr should be excluded from a debate of this nature. I have been trying for some months to persuade people in the west of Scotland who have been led to expect a tremendous new boom in oil development that we are at a very early stage in the exploration process. At the moment there is no evidence of any substantial finds in the area. I therefore hope that people will not have inflated expectations which may or may not prove to be true. Perhaps we should pursue this matter later, because other hon. Gentlemen wish to speak and I agreed to give way to the hon. Member for Linlithgow (Mr. Dalyell).

Mr. Dalyell

With my right hon. Friend the Member for Glasgow, Govan (Mr. Millan), I spent the morning at the General Council of British Shipping, which confirmed something which for some time has bothered a number of us who have constituencies on the North sea, and it is the advantage that the Norwegians are getting from their tax regime. When serious people such as the chairman of Shell tankers say that the Norwegians tax regime is allowing them advantages which do not accrue to British nationals, I wonder whether the Scottish Office, along with Treasury and Trade Ministers, would at least undertake to examine this complex issue.

Mr. Younger

We in the Scottish Office always do our best to follow up any cases of unfair practices, discrimination or discriminatory measures. No doubt the hon. Gentleman will take up the matter with the Treasury, and I, too, shall take it up with my Treasury colleagues to see whether something can be done.

I shall briefly mention banking, insurance and the financial sector. It now directly employs some 90,000 people in Scotland, and Scotland is the only major financial centre in the United Kingdom, outside London. That is most important for the future development of the Scottish economy, because it provides one of the resources that I said was necessary for a sound economic base—the back-up of sound financial institutions, with the resources and management expertise that they provide.

Tourism is another sector which is playing an increasing part in bringing prosperity to Scotland. Last year, tourist expenditure earned a record £760 million and about 50,000 full-time equivalent jobs are either directly or indirectly associated with this spending.

But alongside each of those new growth sectors certain of our traditional manufacturing industries are sustaining their presence in Scotland, despite generally difficult world trading conditions. The Borders knitwear industry, for example, has combined the able marketing of well designed, high quality products with the rapid implementation of new technology and production to achieve significant sales at home, and particularly abroad. In engineering, recent orders have included £6 million worth of contracts for ball valves to be manufactured by the Cameron Iron Works at Livingston for plants in Algeria, Norway and Russia.

Already this year British Aerospace has won a total of £10 million worth of export orders for the USA and Australia and, indeed, only yesterday a further £11 million order for six aircraft was announced. Scotland is also selling paper-making machinery to Pakistan, scarves to the Soviet Union and coaches to Hong Kong. These are only a few of the major exports contracts achieved in 1983 by Scottish companies that are clearly competitive in world markets.

But perhaps the most exciting industrial renaissance for Scotland has come from the growth of high technology industry. The real potential of this sector lies in the productivity growth of which it is capable. The output of the electronics industry, for example, has more than doubled since 1975 and has increased by two fifths between 1979 and 1982.

I am somewhat surprised that efforts are being made in certain quarters to deny even the success of our electronics industry. We are all aware of and delighted to note the major investments in Scotland which have taken place in this sector in recent years. The latest signs are that employment in electronics has increased over the past two years and, on the conventional definition of the industry, is likely to be over 40,000. Today's high technology jobs cannot be compared with the jobs in electromechanical engineering which they have supplanted. Electronics is not only a growth industry in its own right, but provides the technology from which other sectors can benefit. Our financial sector and the exploration of North sea oil would not have advanced so successfully without the ready adoption of so much sophisticated modern technology.

The electronics industry has also been notable for the opportunities it has given to indigenous Scottish companies. I have in mind such names as Fortronic, Prestwick Circuits, the largest producer of quality printed circuit boards in the country, Future Technology Systems which produces multi-purpose business machines and many others. But Scottish skills and the research facilities of our universities have also attracted many companies from abroad. The presence of such major international companies as Marconi Instruments, IBM, National Semi-Conductor, Digital and Motorola, which only last month announced a further £22 million expansion project at East Kilbride, is important in supplying employment opportunities and in creating a climate which provides further encouragement for indigenous manufacturers.

Mr. James Hamilton (Motherwell, North)

With all these success stories which the right hon. Gentleman lays claim to have made, will he verify that Terex, in my constituency, is now in the hands of the receiver and that if this factory fails it will mean the loss of a further 1,015 jobs? Is he aware that in the earth removing equipment section there is no work at all and that applies also to Caterpillar, in my constituency? The right hon. Gentleman must know that in Lanarkshire, which has 20.4 per cent. of the insurable population unemployed, there is no success at all. If there is a factory other than Motorola, can he tell us about it?

Mr. Younger

I very much share the concern of the hon. Member for Motherwell, North (Mr. Hamilton) about Terex. It is obviously a matter of very great importance. I have already been in touch with the liquidator to make it clear that if there is any help we can give in restructuring the company in the recovery programme, if such can be put together, the Scottish Office is ready to give such help.

Health care and biotechnology are also industries of the future. Our health care industry has been growing recently at 15 per cent. a year and companies such as Ethicon are in the forefront of supplying materials for the most advanced forms of medical treatment.

It is vital that Scotland should take full advantage of the opportunities that these new technologies offer and I regard the forceful and disproportionately successful response of Scottish entrepreneurs, as can be seen from the announcement made last Friday, to the exciting possibilities we have opened up in cable television as evidence that this lesson is being learnt. The Government are fully committed to creating the conditions in which this can happen. I can only briefly allude here to the measures we have already taken, but in any case they are familiar to most hon. Members. We have introduced numerous measures to help small businesses to start up and expand and have made a wide range of schemes available throughout the country to assist industry in applying new technology. We have ended the monopoly of the British technology group over the commercial exploitation of Government-funded research and we have adopted a very positive approach to improving the collaboration between tertiary education and industry.

In addition, the Government have encouraged the Scottish Development Agency to focus its activities increasingly on the promotion of technology and enterprise within Scotland. During this Government's period of office the agency has greatly expanded the level and range of services which it provides to new and small businesses. In addition, it has launched specific initiatives to promote Scotland as a centre of technological excellence with emphasis on electronics, health care, energy-related industries and advanced engineering. The drug development unit in Dundee and the Bioscot project in Edinburgh are notable examples where the agency in partnership with the universities, local authorities and the private sector is helping to put Scotland in the forefront of new technology. The agency has also developed a science and high technology park in Glasgow and proposes to establish further parks in Dundee and Aberdeen.

Grasping the opportunities of the future is not simply a question of developing entirely new high technology industries. It is equally important that existing Scottish companies should adapt with the times. The Scottish Development Agency now provides a range of business development services to help Scottish companies and has established a technology transfer group to encourage product diversification. Scottish companies will have an unrivalled showcase for marketing their products in the Scottish exhibition centre, another SDA-sponsored initiative that the Government have backed.

Mr. Russell Johnston (Inverness, Nairn and Lochaber)

rose——

Mr. Younger

I have been very generous and if I give way to the hon. Gentleman it will take too long.

The restructuring of the Scottish economy is therefore well advanced. Indeed, we are fortunate that the Scottish economy is now better balanced in terms of the distribution of our manufacturing and service sectors and in terms of the mix of our manufacturing industries than most of the other regional economies in the United Kingdom. Nevertheless, there remain some areas of continuing difficulty where our objective must be to assist the necessary process of adjustment to the realities of today's world markets.

One such area is steel to which the Government have given nearly £3,000 million in support since coming to office leading to improvements in the industry's productivity to match in some cases the best levels in Europe. In achieving this more healthy competitive position overall, I do not have to remind the House of the painful reductions that have been necessary in BSC's capacity in Scotland. I should, however, like to pay tribute again to the remarkable improvements in productivity which have been achieved by the work force at Ravenscraig.

As to the proposal to export semi-finished slab from Ravenscraig to the United States, I can only say that the new chairman of BSC reported to me at our meeting last month the latest state of play on BSC's negotiations with US Steel, that these negotiations are still continuing and that it remains to be seen whether BSC and US Steel can reach agreement. I underline, however, that if and when a proposal is put to the Government by BSC it will be for Ministers to take the final decision on any deal and I and my colleagues will consider very carefully the implications for Ravenscraig.

Another area of difficulty to which I am sure many hon. Members will wish to refer is shipbuilding. I share the concern about prospects for shipbuilding on the Clyde and its importance to the local economy which was expressed to me by leaders of the Scottish churches last week and which I am sure will be repeated in the House today. In particular, I very much hope that the current negotiations between the management of Scott Lithgow and their customers at Britoil will lead to the Britoil rig being completed at Scott Lithgow rather than being moved elsewhere. I am aware of the article in one of today's newspapers, but that does not change what I have said.

Discussions between the parties are continuing. The Government have sought to help the industry overall by giving support to the tune of £840 million since we came to office. But the performance of the United Kingdom shipbuilding industry is extremely patchy. The good performance at Govan, at Hall Russell and at Fergusons is greatly to be welcomed, as is the continued development at the Yarrow yard. Overall, however, productivity within British shipbuilding is less than half the level achieved by leading European yards and only one third of the Japanese level.

The Government have agreed to consider British shipbuilding's request for "crisis aid" for its merchant shipbuilding yards within the context of the new corporate plan for the corporation and our international obligations. But, make no mistake, the market for orders, even for the best yards, is extremely difficult. The industry can hope to survive only if it accepts new working practices and improves its performance.

The long-term viability of the coal industry is vital to our national as well as to Scotland's general economic well-being. To that end the Government have invested £3.5 billion to enable the industry to become and remain competitive. How this is achieved in detail is for the National Coal Board: it knows what the task is and must be given the management authority to get on with it.

More generally, we recognise that the process of adjustment involves not only industries but individuals.

Mr. Alexander Eadie (Midlothian)

Surely the right hon. Gentleman is not going to gloss over the problems of the coal industry in his speech. He knows that there has been a reduction in coal burn, so what does he propose to do? Does he mean that there must be a further contraction of the Scottish coal industry? He is the custodian, to some extent, of the Scottish economy, and he should be telling the House today what he proposes to do to ensure that we sustain a prosperous coal industry in Scotland.

Mr. Younger

I understand the hon. Gentleman's concern about the matter, and the reason why I mentioned the industry is that it is important to Scotland. It appears that the coal burn will increase in the immediate years ahead, which I am sure the hon. Gentleman will welcome; but the Government have provided large sums to help the industry to restructure itself, and we must now let the management get on with that job.

I reject the option of continuing to pour money into declining industries simply to avoid the social consequences, because such subsidies would never create lasting jobs or real wealth. At the same time, we recognise the need to provide opportunities for individuals who, in many cases, have given much of their working lives to a single employer. While it is rarely possible following a major closure to find another employer to recruit on the same scale overnight, the success of the SDA task force in the Garnock valley and of the enterprise zone at Clydebank show what can be done. In both areas concerted efforts by the SDA and other agencies have created a rich diversity of new businesses, often building on the initiative of those made redundant.

While I have no wish to minimise the severe effects of unemployment on individuals, or the severity of the problem of long-term unemployment, it is important to bear in mind that the simple unemployment totals released each month mask substantial movements on and off the register. Well over 100,000 people have been leaving or joining the register each quarter, and in the two latest available quarters the flow off the register has exceeded the flow on to it. Placings by jobcentres and professional and executive register offices have also been rising. In the third quarter of this year, the number of people placed in Scotland totalled 62,000–10,000 more than in the same period of 1982.

Of course there are areas that have been especially hard hit by unemployment because of the rundown of the traditional industries, or in some cases of other industries.

Mr. Russell Johnston

The Secretary of State has not yet referred to the fact that the Highlands and Islands Development Board has run out of money. Is he aware that it costs the state less if the board creates a job than it does to support a person with unemployment benefit and social security? Can he explain why, if he is anxious to promote viable industry, he is not doing something to ensure that the board receives more money?

Mr. Younger

The hon. Gentleman is not strictly correct in what he says. The Highlands and Islands Development Board has been so successful during the past few years that it has managed to use hugely greater sums each year than in the previous year. The hon. Gentleman will know that the board has received increased funds to deal with an increasing problem, and it has been generously funded by the Government. My hon. Friend the Under-Secretary of State will say something more about the board when he replies to the debate. Anyone who examines the record of money allocated to the board since 1979 could say nothing other than that the Government have most generously funded that organisation during those years. The hon. Gentleman's criticism does not stand up.

There are areas that have been especially hard hit by unemployment because of the rundown of traditional industries, or in some cases because of special features such as remoteness. We have recognised the need to concentrate special help on such areas. The Government are firmly committed to effective regional policy, and this has already played an important part in transforming the Scottish economy. As the House knows, my right hon. Friend the Secretary of State for Trade and Industry will shortly publish a White Paper on this subject. This will set out the framework and allow a generous period for consultation.

Another crucial ingredient of a sound economic base is the need for a skilled and adaptable work force. In any analysis of Britain's economic performance during the past couple of decades there has been a substantial question mark against the extent and content of skill training. Insufficient training has too often led to opportunities slipping through our fingers because of the lack of expertise to appreciate a new idea's potential, and to translate that potential into a commercial asset. The Government, in concert with the Manpower Services Commission, have at last set out to tackle this issue systematically.

In 1981 the MSC set out three key objectives in its new training initiative. The first was to develop skill training by moving away from time-serving apprenticeships towards agreed standards of practical skill as the main criterion, and with more flexible entry points in terms of age or examination attainments. Progress on this front has been steady. Obviously much negotiation between employers' organisations and trade unions is necessary to secure progress. At least the principle is not widely contested; it is the detailed implementation that inevitably takes time.

The second objective was to give all young people under 18 either full-time further education in school or college, or a period of planned work experience and training. This was realised this autumn with the inception of the youth training scheme, which already has 43,000 places for 16-year-olds and some 17-year-old school leavers in Scotland. YTS represents a bridge between school and work that the country has sadly lacked in the past. It will also pave the way for progress on the third objective—providing wider opportunities for adults, whether in or out of work, to train and retrain at various stages in their working lives.

Further progress on the third objective must await the Government's consideration of the recommendations just made to us by the commission following the consultations that the commission set in train with the publication last April of the discussion document "Towards an Adult Training Strategy". Since the commission's important and weighty proposals have only just reached myself and my colleagues the Secretaries of State for Employment and for Wales, it would be improper for me to comment on them now.

However, I wish to emphasise a central point about training, which is that there must be a willing and active partnership between industry, Government, including MSC, and the education and training providers. If not, different assumptions and different objectives can blunt the effectiveness of our training efforts. With our record of close co-operation in those sectors in Scotland, I am hopeful that we can rise to the challenge. Developments in the curriculum and examinations for 14 to 16-year-olds, and our action plan for 16 to 18-year-olds, show that all the interests involved, which include industry as well as education, are very much alive to the contribution that a more highly trained and adaptable work force will make to the future of Scotland. In particular, it is essential that young people leaving school should have a proper understanding of the world of work. I am confident that this understanding will be given by the new courses being developed as part of our programme of educational reform in schools. The courses will reflect the recognition that education meets the needs of industry. My Department will be issuing a circular within the next few days with plans for a restructuring of technical education for 14 to 16-year-olds. In addition to major improvements in craft and design courses, two new courses in computing studies and technological studies will be developed for the new SCE standard grade.

A vital prerequisite of a sound economy that I have not mentioned so far is the need for the correct macroeconomic conditions.—[HON. MEMBERS: "Oh!"] When we came to power in 1979, the British economy had embarked on a disastrous course. Since 1975, our unit labour costs had almost doubled, while they had increased by only a third in the United States, by one-sixth in Germany, and had stayed almost flat in Japan. Inflation was out of control and the world recession did nothing to increase demand for British products. The main undertaking that we gave to the country was that inflation would be beaten, and we have held to that promise. Inflation, at about 5 per cent., is now at its lowest for 15 years, and I am confident that it will fall still further in the months ahead. There has also been a major improvement in our manufacturing productivity. At the same time, average wage settlements have moderated, and these two factors, together with a shading in the exchange rate, have greatly improved the United Kingdom's competitive position since 1981. The background conditions are therefore improving considerably.

Mr. Archy Kirkwood (Roxburgh and Berwickshire)

Does it not occur to the Secretary of State that everything he has just said about the way the Scottish economy is responding to this massage, economic and otherwise, flies in the face of the evidence that has been recently produced by the CBI in Scotland and by the Fraser of Allander Institute?

Mr. Younger

I do not agree with the hon. Gentleman. It is closely in line with the forecasts. Whether hon. Gentlemen appreciate the point or not, the improvement in Scotland has been even more striking than that in the United Kingdom as a whole. While the United Kingdoms manufacturing productivity has been increaseing at 2 per cent. per annum, Scotland's has been increasing at 5 per cent. per annum. While, during the recession, United Kingdom manufacturing production between 1979 and 1983 fell by 14.3 per cent., in Scotland it fell by only 9.9 per cent. Even during the worst of the recession neither our manufacturing output nor our employment fell as fast as it did in the rest of the United Kingdom. In 1971 Scotland was ranked eighth among the United Kingdom economy planning regions in terms of GDP per head of population. Scotland has now risen to second place in that league.

It is against that background that the amendment tabled by the Opposition seems so out of place and irrelevant to the position of Scotland today.

Mr. Dennis Canavan (Falkirk, West)

Will the Secretary of State come down to earth and answer a couple of simple questions? How many people in Scotland have lost their jobs since he got his job as Secretary of State for Scotland? When does the right hon. Gentleman expect a decrease in the appalling level of unemployment in Scotland that his Government have created?

Mr. Younger

On the latter point, do not need to expect a decrease—it has been taking place in the past three months, although the hon. Gentleman may not have noticed.

Mr. Canavan

Answer the question.

Mr. Younger

It is unreal for the official Opposition to condemn economic depression and unemployment without saying anything concrete about how it should be dealt with. Their amendment strikes at the whole of the positive side of the Scottish economy and demonstrates only too clearly that the Opposition do not welcome the new developments in Scotland and probably do not fully understand them properly either.

This leads me to wonder what the position would be today if I had acted upon the advice given to me so consistently by the official Opposition over the past four years. We all know—and I think that there will be general agreement on both sides of the House on this—that had the Opposition's advice been heeded the levels of public expenditure would be very much higher than they are now. That would have had to be paid for by higher taxes and higher interest rates with higher borrowing, and undoubtedly a much higher rate of inflation. All of those consequences would be gravely damaging to business and industry in Scotland and indeed contradict explicitly everything that business and industry have been asking the Government to do. There is no way, for example, that the national insurance surcharge, invented and devised by the Labour Government, could have been reduced in the way that it has and no way that our higher productivity and greater competitiveness could have been achieved with a Labour Government piling extra burdens on to our industries all through this difficult period.

The Opposition's economic policy has been clearly seen to be incredible by public opinion generally over the past year and the damage that it would have done would nowhere have been more severe than in Scotland, which has been slowly but steadily building up a new industrial base during those years.

I very much hope that the hon. Member for Garscadden will now succeed where others have failed in bringing his party in Scotland to accept and welcome the new developments and new attitudes that have grown up throughout industry in Scotland and which today, by their amendment, the Official Opposition are rejecting. For the rest of us it is essential that we redouble our efforts to make Scottish industry more competitive by cutting costs and improving our products and their design and marketing wherever we can. That is the only way in the long term geniunely to win back the markets that we have lost over the past 15 years and that is the only way to create genuine new jobs. Of course, we still must face many problems but the hard decisions that have been taken over the past few years have begun to pay off. In recent months we have seen signs of this only too clearly. Unemployment, seasonally adjusted, has fallen by an average of 700 a month in the past three months. That is the most encouraging three-monthly trend for four years. Vacancies are now more than 30 per cent. higher than in the second quarter of last year. Placings by jobcentres have increased—60,000 people found jobs through this route in the third quarter of 1983, which is 10,000 up on the previous year. In the first nine months of this year, private housing starts were 32 per cent. up on the same period last year. The October review of the Scottish economy by PEIDA points to a continued recovery in Scotland in 1984. The growth rate of manufacturing productivity in Scotland between 1978 and 1982 was running at about 5 per cent. a year whereas in the United Kingdom it was running at only 2 per cent.

In whatever way hon. Members look at these trends over recent months and weeks, they will see clearly that the hard decisions taken are beginning to pay off. This is not the time to reverse progress or to change the course of the Scottish economy. We have seen, for the first time in the lifetimes of most hon. Members, a change in the traditional relativity between the Scottish economy and that of the United Kingsdom as a whole. That is due to the fact that at long last Scotland is part of our economic recovery and is about to lead this country out of the recession that has caused so much damage.

4.46 pm

Mr. Donald Dewar (Glasgow, Garscadden)

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof: 'notes with growing anger and alarm the Government's failure to sustain Scotland's industrial base and to protect her people from the ravages of economic depression and high unemployment; calls on Her Majesty's Government to reverse policies which have struck both at the traditional heavy industries and those based on the new technologies; and condemns the tragic waste of North Sea oil revenue largely committed to paying for ever-lengthening dole queues and the all too obvious inability of the Secretary of State for Scotland to fight within the Cabinet for recognition of Scotland's pressing economic needs.'. I should like to start by thanking the Secretary of State for Scotland for his kind words at the beginning of his speech. I am almost an expert now on the right hon. Gentleman's performances. For a wild moment or two, I thought that there were one or two timid signs of attempted humour in his opening sentences, but his speech deteriorated predictably into a fifth-rate economic lecture of the type that gives modern studies a bad name. The only excitement, if I can call it that, in the right hon. Gentleman's speech was the occasional loyal bleating of his junior Ministers, who in a few minutes will be sent back to Dover house to practise the difficult job of grasping future opportunities, whatever they may be, under this Government.

I watched a film on television the other day which centred on the domestic life of a small desert rodent which struck me as having many of the characteristics of the Secretary of State. It was a small and, I suppose one might say, neat and slightly sleekit animal, with one real characteristic—whenever danger threatened and there was a crisis in the offing, it scrabbled into a hole and lay there squeaking ineffectively in the hope that the danger would pass away. That may be an absolutely admirable strategy for survival among desert rodents, but it is not recommended for Secretaries of State for Scotland. As the House recognises, we face a crisis that will not go away. What we look for from the Secretary of State is not just a survival strategy, but an ability to get up and face the magnitude of the crisis.

I recognise that the right hon. Gentleman's advisers have been working hard to improve his image. I have been reading many of the puffs that appear in the technical press. I was amazed to hear the other day that the right hon. Gentleman is a benevolent dictator. I question at least one of those words. There was a splendid photograph, which I think came from the right hon. Gentleman's Argyll and Sutherland Highlanders' days of him looking square into the future under the caption: He who speaks for Scotland. The reality of the right hon. Gentleman's position is well instanced by the signatures at the head of the Government's motion. The Prime Minister rightly leads the way, followed by an odd job lot, if I may say so, of Ministers, including the Secretary of State for Education and Science whose connection with Scotland is thankfully remote. Bringing up the rear is the Secretary of State for Scotland. That is perhaps a tribute to a clerk in the Prime Minister's office who remembered to include the right hon. Gentleman's name at the last minute. I suppose that someone said, "Gosh, I suppose that we had better put him in. What is his name, anyway?" The inclusion of the right hon. Gentleman's name is a touching tribute to attention to detail and due regard for what is proper. The right hon. Gentleman appears at the bottom of the list—the end of the pecking order.

I object to the content of the motion, not to the signatories. We have been presented with appalling complacency. First, there is complacency about the level of unemployment. It is a piece of cheek to suggest that the Government have been strengthening the Scottish economy. To say so is to fly in the face of all the evidence. One of my difficulties in my new position on the Opposition Front Bench is that I have to read the Secretary of State's speeches, which are kindly supplied to me by the Scottish Information Office.

Mr. Younger

The hon. Gentleman asked to be supplied with them.

Mr. Dewar

Yes, I did. They are extremely interesting speeches. I shall draw the attention of the House to a speech that the right hon. Gentleman made to the Institute of Directors at Auchterarder on 11 October. During the course of his speech, he said: No one can deny that the present levels of unemployment are distressingly high. I suspect that anyone who says, "No one can deny that", would very much like to make the denial, but knows that it is impossible to do so. To talk about unemployment being "distressingly high" is to approach the problem in and academic and detached manner. It is a description that shows there is no gut feeling. The Opposition say that unemployment is tragic, not merely distressing.

There are 333,000 Scots out of work, of whom more than 120,000 have been out of work for over 12 months. In June 1979 there were 2.1 million in work, but in June 1983 that figure had fallen to 1.8 milion. The right hon. Gentleman calmly makes the assumption that he can take credit for the oil jobs. If we had not had the windfall of North sea oil, the Scottish economy would be in an appalling mess. Since 1979 we have seen more than a 50 per cent. increase in the number of directly related oil jobs. At the same time, we have broken away from the old unanimity of view that we should use North sea oil revenue to create an industrial base for Scotland's future. That trust has been betrayed. If anyone asks "What did you do with the oil?"——

Mr. Wilson

Will the hon. Gentleman give way?

Mr. Dewar

No, I shall not give way to the hon. Gentleman.

Mr. Wilson

rose——

Mr. Deputy Speaker (Mr. Paul Dean)

Order. The hon. Member for Glasgow, Garscadden (Mr. Dewar) has made it clear that he is not giving way.

Mr. Dewar

I shall not give way to the hon. Gentleman. As the House is rightly anxious to protect small minorities, even in Scottish politics, the hon. Gentleman may be able to catch the eye of the Chair later and make his point during his speech. We shall wait until then to hear it.

Mr. Wilson

Will the hon. Gentleman give way?

Mr. Dewar

The industrial base of Scotland——

Mr. Wilson

Will the hon. Gentleman give way?

Mr. Deputy Speaker

Order. The hon. Member for Dundee, East (Mr. Wilson) should not push his luck. I know that he hopes to intervene in the debate.

Mr. Dewar

We are entitled to be bitter about the way in which the oil revenue has been wasted. There is complacency about the level of unemployment and there is complacency also about the chances and prospects of recovery for the Scottish economy. The Secretary of State is showing every sign—the name changes with ministerial changes—of Lawson's disease, which is fatuous optimism in the face of all the evidence.

I have read the Fraser of Allander Institute report of November 1983. It comes hot from the press, but it does not come with good news for the Government. It states that Scotland is the only region not to have had an increase in seasonally adjusted vacancies in the three months to October. Every region of the United Kingdom except Scotland had an increase, but it has decreased in the United Kingdom generally. Overtime in Scotland is falling more rapidly than in the United Kingdom overall. The index of industrial production fell by 2.6 per cent. from the first quarter of 1982 to the first quarter of 1983

The Under-Secretary of State for Scotland (Mr. Michael Ancram)

Who wrote the report?

Mr. Dewar

I can tell the Under-Secretary of State that it was not written by a Labour politician. It is the report of the Fraser of Allander Institute.

Mr. Michael Forsyth (Stirling)

rose——

Mr. Dewar

It is unfortunate that the opinion expressed in the report is that any recovery that there may have been——

Mr. Forsyth

Will the hon. Gentleman give way?

Mr. Deputy Speaker

Order. It is clear that the hon. Member for Glasgow, Garscadden (Mr. Dewar) is not giving way.

Mr. Dewar

I am not giving way to the hon. Member for Stirling (Mr. Forsyth). I shall be delighted to give way to other hon. Members in a short while, but I shall not give, way to the hon. Gentleman.

The summing up of the Fraser of Allander Institute is that recovery, if recovery there ever was, is flagging. I believe that recovery was stillborn.

The Government are complacent about trends in the Scottish economy. There is a programmed response every time we consider the Scottish economy. Ministers start talking about the silicon glen concept, and we get a chips-with-everything response. I made some mistakes in anticipating the Secretary of State's speech. I thought that it would contain references to Wang, Digital and National Semi-Conductors. I think that I anticipated six of the seven examples that the right hon. Gentleman chose to present but there were one or two in the mix that. I did not pick. It was a predictable response. We welcome the jobs that these undertakings have created and we want to see more of them, but we are entitled to object to any suggestion that they have replaced heavy job losses in other sectors and that they provide a disguise for the Government's abject failure.

I am indebted to my hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) for his written question which was answered on 10 November. The answer revealed that employment in the electronics industry in Scotland in 1970 was 48,258, in 1981, 37,626 and it is now 36,500. The Secretary of State used another figure this afternoon, but he referred to 36,500 when he addressed the Scottish Council seminar at Aviemore on 28 October.

The census of employment of September 1981 provides other interesting figures. We cannot obtain a more up-to-date census, because the Government have put a stop to the statistics appearing. As the Conservative Government approached power in 1978, there were 51,000 employees in the electrical and electronic engineering industries in Scotland. In 1981 there were 42,000. I do not glory in gloomy news—I should love to be able to report an expansion in that sector—but I must present the figures to correct the unsoundly based euphoria that has been created to try to distract public attention from the reality of what is happening.

The Opposition recognise the need for change in the Scottish economy, but we should never underestimate the necessity of protecting and preserving jobs in the traditional heavy industries of Scotland. The 1981 census of employment reveals that at that time there were 74,000 jobs in the iron and steel, coal and shipbuilding industries in Scotland. With the help of some friends I have tried to trace all the notified redundancies between the September 1981 census and 1983. In mining and quarrying, metal manufacturing and shipbuilding—we adopted wider categories and have probably produced an overestimate—there were about 9,000 notified redundancies. If that figure is subtracted from the 74,000 jobs in the three basic major industries, those industries still provide about 65,000 jobs in Scotland. We think that those industries are important, especially when they are compared with the 36,500 jobs in what I would like to see as the growing electronics and high-tech sectors.

We must fight every inch of the way to preserve what is rapidly becoming an endangered species—manufacturing jobs. Deindustrialisation is an ugly word for an ugly process, but it is a harsh reality and it describes what has been happening since the right hon. Member for Ayr (Mr. Younger) became Secretary of State. In 1979, 596,000 Scots were employed in manufacturing industry and in 1983 there were 431,000. The right hon. Gentleman has presided over the disappearance of 165,000 jobs in manufacturing industry. That is not mere complacency but criminal complacency by the Government.

Mr. Robert Maclennan (Caithness and Sutherland)

Was the hon. Gentleman struck, as I was, by the fact that the Secretary of State did not mention the building industry and the decay of Scotland's infrastructure, which would be very labour-intensive if it were properly used?

Mr. Dewar

I have very much sympathy with the hon. Gentleman's point. The Secretary of State managed a few names, such as Wimpey. He probably feels very much at home with Wimpey. However, he avoided a large number of danger points to which the hon. Member for Caithness and Sutherland (Mr. Maclennan) will no doubt refer if he catches your eye, Mr. Deputy Speaker. There has been a vicious attack upon infrastructure in Scotland, and the Government have stood back and watched it happen. My hon. Friend the Member for Falkirk, West (Mr. Canavan) last night pointed out that we had some things for which we could be thankful. The deindustrialisation of the Clyde has brought the salmon back, but I do not believe that there has been any other useful by-product of the Secretary of State's efforts.

The Secretary of State mentioned Ravenscraig. He bravely says that he has no idea what is happening and that no proposition has been put to him. He has often been warned by the Labour party that the preservation of Ravenscraig as an integrated steel works cannot be equated with ending its processes at the slab stage, the Fairless deal with a loss of about 2,000 jobs in Scotland, our cash being used in the modernisation of United States steel plants and trade being carried across the Atlantic in United States ships. If such a deal is proposed, we expect the Secretary of State to meet it head on and to protect the interests of the Scottish steel industry.

At the moment, we have continuous casting in the United Kingdom. If we were to commit all of Ravenscraig's continuous casting production to foreign markets we would deny the United Kingdom industry this particularly desirable form of slab, or we would commit the British Steel Corporation to a duplication of that casting facility. That would make no sense either way. I gather that the Secretary of State in this, as in every other passage of his speech, had almost nothing to say to us. If he receives a proposal before the House rises for Christmas, we expect him to come quickly to the Dispatch Box to tell us what has happened. We do not want irrevocable decisions to be taken under cover of the Christmas recess.

The Labour party makes it clear that the loss of a significant number of jobs in the particularly sensitive area of Scott Lithgow will be unacceptable. I accept that delicate negotiations are under way and that Britoil and British Shipbuilders must try to renegotiate that contract. We hope that that negotiation will be successful. At some point, however, the Government must take responsibility. If things are going wrong and initiatives can be taken, we expect the Secretary of State to take a more active part than he has taken in the past.

There must be a balance of energy sources. The coal industry is suffering from the recession, economic decline and the lack of demand that is built on that. There is a strategic case for a viable coal industry, and that should command the Government's attention. The Government must not rip the heart out of the industry. North sea oil supplies will not last for ever and coal may have an increasing part to play towards the end of the century. I hope that the Secretary of State will examine combined heat and power schemes, the problem of the coal burn, the cut in the South of Scotland Electricity Board's consumption, the long-term implications of gasification and the experience built up at the Lurgie plant.

The hon. Member for Caithness and Sutherland said that there has been silence from the Government about the construction industry. Many construction workers are out of work. Savage cuts, especially in local government spending, have had maximum impact on the industry. I received a letter, as I suspect did other hon. Members, from the Royal Incorporation of Architects in Scotland which described the decisions which have created a dead stop in many parts of the country where improvement and repair grants have been a disaster. That is true. That is a matter to which we shall want to return on many other occasions in an attempt to get some satisfactory answers.

Almost everywhere there are signs of disaster and problems. It is no good the Secretary of State looking pained. Companies such as Anderson Strathclyde, Weir Pumps, Terex, UIE, British Leyland and John Brown—I can give list after list—have problems because they are Scottish and because recently they have experienced many redundancies. It is no good saying that there is a recovery in some sections. High technology industries, such as aviation, and the record of Rolls-Royce in Hillington which has experienced a rundown in the labour force again show a need for Government courage and support, even in the most sophisticated industries, to sustain technology and development and to capture world markets.

All hon. Members accept that problems cannot be wished away. The world recession will not disappear because we change our Government, but the Conservative Administration by their errors have compounded many of the problems that we face. We cannot cut expenditure and pretend that it merely affects services, because it also affects jobs. We cannot increase industrial costs or taxation, as the Government have done, without killing the possibility of recovery. If that is thought to be a partisan statement, I refer the Secretary of State to Sir Terence Beckett's speech on 24 November 1983. There may be an attack on regional policy. If it comes, we shall resist it, but we know that if it is carried through more jobs will be taken from the hard-pressed areas of Scotland.

I want to see more smeadum and fight from the Secretary of State on such issues. In his speech to the Institute of Directors at Auchterarder we come across an important dividing line. The right hon. Gentleman complained about those who think that if the Government financed major job creation programmes reducing our unemployment totals at a stroke this would be a success. A great deal can be said for "reducing our unemployment totals" and for the Government shouldering their responsibility to create jobs. The Secretary of State went on to say that this was not a realistic objective. With unemployment totals and problems in Scotland at such levels, it must be a realistic objective, and we must have a Government who are prepared to face the task and get on with the job.

What has happened after five years in Scotland under the latterday apostles of Adam Smith? Their monument is an index of industrial production more than 10 per cent. below the 1975 level and record levels of unemployment. In Glasgow Sir Campbell Fraser talked about Scotland being a "miracle of self help". I think that that was a touch optimistic, given the recent CBI forecasts and the confidence of CBI members. Sir Campbell Fraser was right to say that what has been achieved in Scotland has tended to be done on the principle of self help, because we have had precious little help from the Government. The Conservative Administration have been an oppressive, expensive and embittering disaster. We shall therefore vote against the Government's incompetence, insensitivity and complacency and, above all, record of failure that has cost Scotland and its people dear.

5.8 pm

Sir Hector Monro (Dumfries)

The hon. Member for Glasgow, Garscadden (Mr. Dewar) leaves me breathless. I have never heard such an inconsequential speech delivered with such fervour. Had I sat back and closed my eyes, I might have dreamt of the somewhat slower speeches of Lord Ross of Marnock, or even the right hon. Member for Glasgow, Govan (Mr. Millan). It was the same old stuff that we have heard so often, with no new solutions or constructive policies for the development of the economy in Scotland.

The shadow Secretary of State totally failed to deal with the central issue—inflation. My right hon. Friend the Chancellor recently made his autumn economic statement. It is clear that if we want to spend more money that will mean higher taxation or increased borrowing, either of which will lead to a rise in inflation and interest rates, which can only lead to an increase in unemployment rather than the decrease that we all so much desire. Inflation and interest rates must therefore be at the heart of our deliberations today. Let us not forget that interest rates are at their lowest for five and a half years, which itself brings confidence to industry.

It is all too easy for the Opposition to talk about spending our way out of trouble. That simply is not possible. Such a policy would inevitably damage industry and business as well as increasing unemployment. The legacy of the 1974–79 Labour Government is all too stark—raging inflation leading to high unemployment. The Socialists never learnt that when inflation reached 26.9 per cent. in 1975 it began the great economic depression that the country has faced ever since.

There is just a wee glimmer of hope, however, that some Socialists are beginning to learn. The Times of 25 July carried the following statement: Last June our economic policy was a net vote-loser. Our vague hopes of achieving growth through spending were barely understood and rarely believed. The idea of 'borrowing to expand' proved crucially unpopular. The British people realised that the whole strategy lacked two essential ingredients: a coherent plan for investment and a scheme to Combat inflation". That quotation, of course, comes from the deputy Leader of the Opposition and shadow Chancellor, the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley). That statement is entirely contrary to the view expressed in the amendment, to which he has now put his signature. He cannot have it both ways. I hope that he will be here later in the debate to explain how he reconciles the two views.

The Conservatives have won the inflation battle. This is no time to relax but it is time to bring confidence to industry rather than the doom and gloom constantly spread. by the Opposition. They seem to forget that they are still suffering from a devastating election defeat in which they received no mandate to govern, and they have had no new ideas or changes in policy since their utter failure in June.

In Scotland the Labour party is becoming a parochial Strathclyde party. Give or take a couple of miles on either side of the Forth bridge, one can drive from Gretna Green to John o'Groats without passing through a Labour constituency. Labour has no control in Scotland. The importance of the Labour party in Scotland to the Socialist movement is shown by the fact that the shadow Secretary of State for Scotland is not in the shadow Cabinet. That is one of the most serious omissions by the new Leader of the Opposition. One hears rumours that one right hon. Gentleman and one hon. Gentleman declined the position. That does not say much for the importance of Scotland or devolution. The shadow Cabinet appointments show that Scotland is of no importance to the Labour party. It is sad that the Socialist representatives of Strathclyde are so ignored by the Labour leader. Labour has no seats on the border, in the south, the east or the north-east and only one in Grampian. Right up to the Highlands and Islands there is no sign of Socialism—and thank God for that. [HON. MEMBERS: "How many Tories are there?" ] Alliance voters are slowly realising how wrong they were and will no doubt return to us in droves at the next election

The Opposition talk only of expenditure and cuts. They should consider the facts. There are no cuts in social security, in the National Health Service or in law and order, and there have been welcome increases in areas such as agriculture which are so important to the Scottish economy. The Opposition seem to think that there is no investment in Scotland, but that is not true. In Dumfries and Galloway new investment of more than £40 million has been completed or started in the past four months. That is a significant amount and very welcome in terms of new jobs.

The Opposition do not begin to understand the effect of the high rates levied by Socialist authorities on incoming investment. Regional and district rates are driving out the commercial and business centres of Edinburgh and Glasgow. That is the result of Socialist policies.

Mr. Maxton

Which district council in Scotland has the highest average domestic rate payments per household?

Sir Hector Monro

I know that my constituents have the lowest, which is far more important.

I welcome the Government's efforts to help small industries and businesses because that is where the resurgence of the economy will come from. The Government have helped small businesses and industries with no fewer than 110 measures, but there is more to be done for that sector in terms of taxation. More important, there is still far too much red tape, which must be removed. We must also consider the damaging effect of the wages councils on shopkeepers in Scotland and reexamine the Employment Protection Act, which probably does more to keep people out of work than any other measure.

Simplicity in the grants and methods of help available is vital in attracting new industry to Scotland. The Secretary of State and his Department have produced excellent brochures on the various forms of assistance, as has the Scottish Development Agency. I am delighted that my right hon. Friend emphasised the increased expenditure by the SDA throughout Scotland. It is doing excellent work and it is essential for it to keep close to the people on the ground and never to lose the personal touch that it has built up. The ability to telephone the head of the SDA and talk to him personally is a great advantage to those who need urgent help.

Regional policy is extremely important and will be dealt with in a White Paper in the not too distant future. That policy is crucial to the United Kingdom and has provided 500,000 or more jobs, stemming from the Local Employment Act 1983, which rightly stressed the importance of small development districts in areas of high unemployment and provided substantial funds to help such areas through the creation of advanced factories and all the other regional incentives.

Subsequent Governments extended assistance to 43 per cent. of the working population, which was too wide. The Government were right to reduce the figure to 27 per cent. If we are to re-examine the policy while maintaining the same input of resources, we should be prepared to reconsider reducing the number of areas eligible for support and concentrate our resources on supporting areas of high unemployment, which is substantial throughout the United Kingdom. If we concentrate our resources on the areas that have unemployment at 15 to 20 per cent. they would receive the maximum benefit. Statistically speaking, we are shifting unemployment from one area to another without creating more jobs.

I wish to see incentives concentrated in essential areas but using the same amount of money, thereby enabling the areas with the highest unemployment to increase their ability to bring in new jobs. We should seriously consider introducing service industries into areas of high unemployment. They can create jobs in the same way as manufacturing industries. Given the assistance of my right hon. Friend the Secretary of State for Scotland to the tourist board, I hope that we can see developments there.

We must regard tourism as one of the growth industries of the next decade. The more help that the Government can give to providing quality hotels that will attract visitors from the south and abroad, the more we shall be able to move in the right direction.

I hope that we shall look carefully at the relationship between regional policy and EC grants. It is unfair that some areas are not permitted to have EC grants because they are non-assisted. Such help is essential for the forestry industry in my part of the world. It needs the infrastructure grants from Europe.

I wish to emphasise to my right hon. Friend how important it is for him to make a major effort to look after the rural economy. Unemployment in the countryside is just as severe as in urban areas. In addition, there are fewer opportunities for work. We must begin by having a profitable agriculture industry because that leads to jobs in agricultural engineering, seed merchants, auction marts, smithies and so on. We must further re-examine the opportunities of bringing light industries to the countryside. We must encourage them to relocate in those areas. We must keep the population in the rural areas to maintain the schools, the churches, the village halls and most importantly public transport and everything else that contributes to a viable countryside. A tremendous amount remains to be done.

The Secretary of State is right to say that he has provided a first-class platform from which we can begin to expand. I am the first to accept that we have a long way to go to combat the problem of unemployment. I welcome what my right hon. Friend has said about the future. The Government must have positive and constructive policies. The policies of the Opposition are in disarray. They have not proposed any new ideas that can produce so much as one new job. They suggest that we should spend, spend, spend, but such a policy would be followed by inflation, high interest rates and high unemployment. It seems that the Opposition will never learn. My right hon. Friend must maintain his policies from which will emanate the jobs that we so urgently require.

5.25 pm

Mr. Bruce Millan (Glasgow, Govan)

I wish to make some remarks about the general state of the Scottish economy, and also refer to the two main employers in my area, both of whom are facing serious problems.

I congratulate my hon. Friend the Member for Glasgow, Carscadden (Mr. Dewar) on his extremely effective and comprehensive speech which compared extremely favourably with the usual rigmarole that we heard from the Secretary of State for Scotland. The debate was offered by the Government. Having heard the Secretary of State, I wonder why he bothered, because he had nothing to tell us. The right hon. Gentleman's presentation was an extremely selective and distorted review of the state of the Scottish economy. We are debating Scotland's economic position against an extremely gloomy overall economic background. I shall not enter into the Secretary of State's argument about macroeconomic policy, as we had a general economic debate recently. Until we have a substantial change in Government policy and get rid of the Government's obsession with cutting public sector borrowing, monetarism and the rest, there is no hope for the Scottish economy and whatever is done by the Scottish Development Agency, the Government or anybody else, they are swimming against a tide that is overwhelmingly against Scotland, as it is against the United Kingdom.

The Chancellor's autumn budget held out no hope for the Scottish economy. The budget was not only criticised by the Opposition and the TUC, but the Government got a raspberry from the CBI which is disputing the Chancellor's optimistic forecasts about increased output in the country in 1984.

The worst aspect of the Chancellor's statement was the admitted acknowledgement that during 1984–85 the level of unemployment in this country will be exactly the same as it is now. In other words, there will be no relief at all from the intolerable and appalling levels of unemployment. The social consequences of such high unemployment will live with us for many years, especially among the younger generation, who are increasingly bitter and disillusioned about a society and Government who they consider have let them down.

The position in Scotland and elsewhere has been obscured by the Government's fiddling of the figures. The published figure of 333,000 is not the true figure for Scotland. If we consider the old method of presenting the figures, we must add at least 50,000 or even as much as 75,000 or 100,000. We must also add the 82,000 Scots who are being supported by temporary schemes of employment. The real unemployment position is much worse than the crude figures suggest.

I consider the Secretary of State's remark that Scotland has come out of the recession, or is bearing up so much better than the rest of the United Kingdom, as offensive. Bearing in mind North sea oil, it would be absolutely astonishing if that were not the position. The Government have managed to foul up pretty well everything else that they have touched, but at least they have been unable to foul up the geography of North sea oil which has brought Scotland about 100,000 jobs. Without those jobs, the unemployment position would be absolutely catastrophic. It is a myth to suggest that Scotland is doing much better than the rest of the United Kingdom.

My hon. Friend the Member for Garscadden referred to the recent report of the Fraser of Allander Institute. The index of industrial production for Scotland in the first quarter of 1983 was published on 5 September. The Scottish Office's own press notice stated: The 0.8 per cent, fall in manufacturing in Scotland"— that is referring to the first quarter— compared with an increase of 2.3 per cent, in the UK. In other words, the Scottish economy is performing worse than the rest of the United Kingdom. It continued: Excluding petroleum and natural gas, industrial production in Scotland fell by 1.6 per cent, in the first quarter of 1983 which compared with a rise of 1.6 per cent, in UK output for the same period. There are signs that the Scottish economy is performing worse than the national economy.

The other myth that has been sedulously propagated by the Government during the past two or three years is that new industries, such as the electronics industry, compensate for the loss of jobs in the older industries. I have said repeatedly that we must encourage the new industries. We naturally want them to locate in Scotland, whether they come from overseas or from other parts of Britain. However, we dispute whether such industries compensate for the loss of employment in the older industries, and I also question our attitude towards the older industries.

Labour Members have always stated firmly that as well as encouraging new industries we must protect and sustain the older traditional industries. An informative article by Alf Young which appeared in the Glasgow Herald this morning, following a parliamentary answer given to my hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes), made it clear that there is an unanswerable case for the protection of the traditional industries which, in terms of crude employment, are as important to Scotland as the newer industries.

A false dichotomy is sometimes made when discussing new and old industries—there is a suggestion that the older industries use ancient technology while the newer industries use modern technology. Of course new industries use modern technology, but anyone with knowledge of the shipbuilding, steel and coal industries will know that a great deal of modern technology is used by them. One reason why the older industries have performed rather badly is that insufficient modern technology has been introduced into our older industries compared with that introduced into the industries of the rest of the world.

I wish to mention two industries in my constituency. Govan is an excellent shipyard, and the Secretary of State acknowledged that in his speech. The CEGB is placing an order for three coal-carrying ships within the next few months. I find it both astonishing and incredible, given the uproar over the CEGB when the order for a cable-laying ship was given to Korea, that this order has been put out to international lender. There is no guarantee that the order will be placed within the United Kingdom, where Harland and Wolff and Govan are the two competitors.

I do not accept that this is a matter where ordinary market forces come into play. The CEGB is a nationalised industry, and another nationalised industry—shipbuilding—is interested in the order. It would be an utter scandal if that order was placed abroad. I warn the Secretary of State and the Minister that there will be a major political row if that order is not placed within the United Kingdom. I am looking for it to come to Govan, which is uniquely suited to build those ships.

The Govan shipyard is quickly running out of work. Unless it receives additional orders, it will run out of work completely by the spring of 1984. That will affect 2,700 jobs. It is desperately important that a yard that has done so much to make itself efficient should obtain that order.

The second industry in my constituency that I want to mention is also the largest employer—although jobs are rapidly disappearing there, too. I refer to Rolls-Royce at Hillington. Only three years ago it employed 6,000 people—it now employs only 3,000. I am talking about the aero-engine industry, which no one could claim uses old and outdated technology. Rolls-Royce is acknowledged as the world's leading aero-engine manufacturer. Yet 3,000 jobs have disappeared and further redundancies were announced last week. It is vital to Hillington and Rolls-Royce generally that the V2500 project receives Government funding. Rolls-Royce has a 30 per cent. share in that international project, and there is an application before the Government for launch aid of £113 million.

The aero-engine industry, indeed, the whole of the aerospace industry, is sometimes neglected in debates. The aerospace industry is extremely important to Scotland, not only through Rolls-Royce but in avionics through such firms as Ferranti and Marconi. It is essential that the V2500 project is aided by the Government— otherwise Rolls-Royce, which has already shed so much labour, will go further downhill and will gradually lose to its American and other competitors.

One of the partners in the V2500 project—together with Pratt and Whitney, Rolls-Royce, a German firm and an Italian firm—is a Japanese consortium. It is involved in the project to learn high technology from the United Kingdom, and also from Pratt and Whitney. I deplore that position, although I accept that in such expensive projects there must be international co-operation. It is an example of an area where the Japanese are years behind the United Kingdom in technology. If we want our industry to remain in the forefront, the V2500 project must be supported by the Government.

The Government must also support the A320 airbus project, which is also important to Rolls-Royce. It is yet another example of the lack of Government direction in industrial policy. British Caledonian is buying the A320, but British Airways is buying the Boeing 737. A British nationalised industry is buying an American aircraft with American engines. If the two projects that I have mentioned are given the go-ahead, a European aircraft will be available which, I hope, will be fitted with Rolls-Royce engines that are largely manufactured in Britain. It is scandalous that the Government have allowed British Airways to make such a decision. The Government are interested only in privatising British Airways, and not in maintaining the British aerospace industry.

I am concerned about an issue that the Secretary of State did not mention today, regional policy. A review of regional policy is taking place, and the only hard evidence we have about the outcome is what the Chancellor of the Exchequer said in the autumn statement about a reduction in regional development grants. When I challenged him about that he said, "Do not ask me, ask the Ministers responsible". We understand that the Scottish Office is still interested in regional development, so when the Minister replies I hope that he will say something about that.

We know that the grant will be reduced——

The Under-Secretary of State for Scotland (Mr. Allan Stewart)

No.

Mr. Millan

The hon. Gentleman denies it, but I am quoting from the Chancellor's autumn statement.

Expenditure on regional development grant is to be reduced. That means that either the level of grant will be reduced or some areas in Scotland and elsewhere will be de-scheduled. The Minister shakes his head but we know what happened in 1979. It was announced in July 1979 that regional aid to Scotland was to be reduced by 30 per cent. It just so happened that the four areas in Scotland which were upgraded were in Ayrshire and included the Ayr constituency of the Secretary of State for Scotland. However, 42 areas were downgraded.

If the Minister would like to assure us that what I have described will not happen I shall gladly give way. Any reduction in the amount of regional aid to Scotland, bearing in mind the appalling level of unemployment that we now have, will be unacceptable and represent a dereliction of duty by the Secretary of State. We have not forgotten that he allowed such a reduction in 1979.

Mr. Allan Stewart

I shall deal with the right hon. Gentleman's point later. If he read an article in The Scotsman yesterday he would know the facts about the autumn statement.

Mr. Millan

I am asking the Minister whether regional development grant will be reduced next year. The autumn statement says quite definitely that it will. Can he assure me that the review of regional policy will not involve a diminution of aid to Scotland? He has not been able to give me such an assurance. I shall be extremely happy if he is able to give that assurance later, having received information from the Box but I do not believe that he will because all the signs are extremely ominous. Incidentally, we should not have to go to The Scotsman to get information when we have Ministers who are supposed to be looking after Scottish interests.

I hope that we shall not be seduced by the idea of giving up automatic regional development grant and replacing it with selective assistance. It is not practical and Scotland would suffer considerably as a result. I know that selective assistance has been mentioned by right hon. and hon. Members on both sides of the House. It is a seductive proposition but it would be extremely dangerous for the regions. We must have an element of automatic grant if the system is to work for the benefit of Scotland. That does not mean that there is no case for examining big schemes that have automatic assistance but do not need it. I have held that view for many years. However, to some extent, that would be locking the stable door after the horse has bolted because grants have already been paid to oil developments and the rest. We should also examine carefully the effect on the electronics industry of being more selective rather than automatically paying some of the grants.

I should like regional aid to be directed more towards job creation. I should welcome such a change through, for example, the reintroduction of the regional employment premium or some other scheme, whereby we relate subsidies to labour rather than to capital. Bearing in mind the appalling levels of unemployment in Scotland, it is not sensible that regional aid should be devoted solely to capital expenditure rather than employment. I hope that a change can be made in that regard.

The signs with regard to regional aid are ominous. We remember our experience of 1979. There is no way out of Scotland's present economic tragedy without major policy changes. We shall not have such changes from the Conservative Government. However, on specific issues such as Rolls-Royce, even the Tory Government can provide aid to protect jobs in such important industries in my constituency. I am sure that every right hon. and hon. Member is able to make similar pleas for threatened industries in their constituencies.

5.44 pm

Mr. Michael Hirst (Strathkelvin and Bearsden)

I echo the words of my hon. Friend the Member for Dumfries (Sir H. Monro) who found the speech of the hon. Member for Glasgow, Garscadden (Mr. Dewar) full of doom and gloom and destructively critical. I also listened in vain for an explanation of how the Labour party proposes to generate jobs in Scotland. At the end of the hon. Gentleman's speech I was in no doubt why his party lost 250,000 votes at the recent general election and why, no doubt, it will lose the same number at the next one.

The hon. Member for Garscadden singularly failed to tell the House what the Opposition's alternative is. I read the Opposition amendment. It offers no hope for the 300,000 people in Scotland who might, in their folly, turn to the Labour party for a remedy. Would the Labour party spend or borrow to generate more jobs? Have the Opposition learnt nothing? The seeds of destruction for manufacturing capacity in Scotland were sown during the Labour Government when the hyper-inflation of 1975–76 destroyed the competiveness of Scottish manufacturing industry.

I accept that, in Scotland, we live with unacceptably high levels of unemployment. We have a preponderance of traditional industries and we have recently gone through the worst world recession for 50 years. It is of no comfort to me, as a Scottish Member of Parliament, that the level of unemployment is higher in several other regions of the United Kingdom. Opposition Members should not try to delude the House and the nation into thinking that they have a monopoly of anxiety about the problems that are thrown up by unemployment. Conservative Members are deeply worried about them too. More than that, the Government have taken much action to mitigate the worst effects of unemployment and to generate more new jobs.

The pattern of employment in Scotland has altered radically and irreversibly. We shall never again have the days of Beardmore's and Singer's, which employed tens of thousands of people. We must face reality and recognise that the future lies with a vigorous sector of smaller businesses which are capable of adapting quickly to the changing circumstances and markets of the 1980s.

Mr. Foulkes

Can the hon. Gentleman tell us of one sector of industry in Scotland in which there has been a substantial increase in jobs in the past five years?

Mr. Hirst

Yes, the financial sector. Opposition Members might laugh but the financial sector has made Scotland the second most important centre of capitalism in the United Kingdom. Edinburgh is an important European financial centre. The hon. Member for Carrick, Cumnock and Doon Valley might shake his head but he should come out of his Socialist enclave in the west of Scotland, visit Edinburgh and admire the work that is being done there. There has been a substantial increase in employment in the financial sector.

The amendments tabled by the Labour party, the Liberal-Social Democratic alliance and by the Scottish National party offer no hope or solution. They merely castigate the Government. Not unusually, alliance Members are not present.

Mr. Albert McQuarrie (Banff and Buchan)

Two of them are here.

Mr. Hirst

One half of the alliance is here but I am never too sure whether they speak for the other half.

Nothing in the amendments tells us how opposition parties would deal with the problem that the country faces. My perception is slightly different. I see many exciting things happening in Scotland, and I am sorry that Opposition Members are so quick to denigrate many of the achievements taking place in Scotland at the moment. Before coming to this place a few months ago my experience—unlike that of some Opposition Members, perhaps—was that of a partner in a major accounting firm. I saw for myself many exciting things taking place throughout the length and breadth of Scotland.

Mr. Foulkes

Where?

Mr. Hirst

I have to respect the confidence of my erstwhile clients, but I can point to many examples of companies. My right hon. Friend the Secretary of State for Scotland has listed many examples including Motorola and National Semi-Conductors. These companies are employing more people now than when a Labour Government was last in power. They are also putting Scotland on the map to a significant extent as a manufacturer of electronic components.

My party and my Government have been prepared to encourage rather than to retard the massive restructuring taking place in the Scottish economy. When the Labour party was last in power, it was prepared to frustrate any effort to allow the radical restructuring of nationalised industries to-take place. Had it tackled the problems of the steel industry in the 1960s and 1970s, that industry would not have suffered from the great problems it has recently experienced. The Labour party has failed to learn that it is the duty of Government to aid the process of industrial transformation as the Conservative Government have done.

Business and industry are like life. Conservative Members believe in and espouse the cause of regeneration. It is sad that the Labour party seems to cling to the corpse. There is no future in that. The massive restructuring has left Scotland with far more competitive industries, and the Scottish economy is now far more broadly based than that of, say, the west midlands.

When we talk about the achievements of the Government in the past few years we should not forget their efforts to promote the small business sector. That is a part of the business world of which I have an intimate and detailed working knowledge. I am well aware of the efforts of the Scottish Economic Planning Department, the SDA and the European regional development fund. The hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes), who speaks for the Opposition on European Affairs, would do well to listen. The European development fund has made a significant contribution to helping small businesses in Scotland, not just with grants but with the provision of better business services and so on. Such things are what the small business man with the courage to set up a business needs. I am proud to welcome the initiative from Europe.

Mr. James Hamilton

The hon. Member is an accountant. When he talks about small businesses he must know that, since the Conservative Government came to power in 1979, 300 companies have gone into liquidation in Scotland. We did not get those figures from the Scottish Office, whose organisation was far too unwieldy to give them, but from the Library. I know of another two liquidations during the past three weeks, and there is also Terex, which employs 1,015 people. Does that suggest that the Scottish economy is making progress?

Mr. Hirst

The creation of new companies has far outstripped those that have died. A substantial number of new businesses have been created during the past couple of years, and the new businesses are creating more jobs than have been lost.

Mr. Foulkes

rose——

Mr. Hirst

I have given way to the hon. Gentleman's colleagues. [Interruption.] I am not talking nonsense. I shall be grateful if the Minister will confirm for the benefit of Opposition Members that far more new businesses have been created in the past couple of years than have been destroyed though insolvency.

We have also seen in the past four years a remarkable degree of co-operation between the public and the private sectors. There have been many imaginative schemes. I am surprised that the hon. Gentleman shrugs his shoulders. The SDA has done a substantial amount of work in his constituency.

Mr. Foulkes

rose——

Mr. Hirst

No, I shall not give way. I shall press on, so that other hon. Members may speak later.

Mr. Foulkes

rose——

Mr. Deputy Speaker

Order. It is clear that the hon. Gentleman is not giving way.

Mr. Hirst

I am grateful to you, Mr. Deputy Speaker, for your protection. I have indicated firmly to the hon. Gentleman that, having taken some of his specious points of information, I intend to press on.

There is substantial regeneration going on around Glasgow. A great deal of work is being done in the imaginative co-operation between the public and the private sectors. There is the construction of an exhibition centre and a science park. The enterprise agencies are doing much useful work. They would be very disappointed if they thought that Opposition Members failed to recognise their contribution to solving the problems of unemployment.

Mr. Foulkes

The hon. Gentleman is like the little Dutch boy putting his finger in the dyke.

Mr. Hirst

The results of the past four years show that Scotland is now better placed to face the future. The right hon. Member for Glasgow, Govan (Mr. Millan) suggested that all the economic pointers were downwards. I draw his attention to the report of Professor Donald McKay of PEIDA. The right hon. Gentleman will remember that name, because he engaged Professor McKay to carry out surveys for him when he was Secretary of State for Scotland. Professor McKay has said that there will be a further significant acceleration in the rate of economic recovery in 1984. I am sure that Professor McKay would be delighted to know that his surveys have been cited in this House. He is considered in Scotland to be a leading authority on such matters.

A moment ago I mentioned the breadth of the Scottish economy. The past four years have brought us to the point when an encouraging number of sectors are poised to go further forward.

Mr. Foulkes

Which ones?

Mr. Hirst

The financial sector is now employing 90,000 people. I can tell the hon. Member for Carrick, Cumnock and Doon Valley that the use of electronic and data processing methods in Scottish banking is now the most advanced in Europe. That is something of which every Scotsman should be proud. The Scottish capital centres are handling more than one third of the private funds in the United Kingdom. I am talking about £5 billion and 90,000 jobs. That sector is very significant. Edinburgh has become a venture capital centre. Such developments augur well for the future. There are exciting possibilities for tourism, which now employs about 50,000 people. I echo what my hon. Friend the Member for Dumfries has said. It is an important sector, which should get appropriate support and encouragement.

What industry wants above all is stable conditions. I welcome the statement by the Chancellor of the Exchequer that not only is the rate of inflation low and staying low but that interest rates are at their lowest level for five years. That is important for investment. I draw the attention of Labour Members to the CBI survey, which was made public earlier this week. It stated that the investment intentions of the Scottish business community are increasing all the time. There is a virtuous circle of higher productivity leading to higher profitability, enhanced cash flow and opportunities for investment.

Mr. James Wallace (Orkney and Shetland)

Would the hon. Member care to give his views on how the increased energy prices, expected as a consequence of the Chancellor's statement, will affect the Scottish economy?

Mr. Hirst

I am grateful to the hon. Gentleman for that question. I cannot say what the impact will be. Plainly, the Scottish business community is aware that it may have to pay marginally more, but it is less than the rate of inflation. Energy prices paid by industry in Scotland and the other parts of the United Kingdom are lower than those paid in West Germany and the United States, which are Scotland's principal competitors.

The quiet and growing confidence that exists in certain parts of Scotland cannot be measured by statistics—[Interruption.] I wonder how far Opposition Members travel when they return to their constituencies. The slow regeneration taking place in Scotland is producing an air of confidence. The traditional Scottish talents of enterprise, hard work, innovation and skill have an opportunity to flourish again in stable conditions. I believe that in the fullness of time the Government's courageous stand will prove justified. At least if offers hope for the future, which is a great deal more than anything I have heard from the Opposition.

6.1 pm

Mr. Gordon Wilson (Dundee, East)

The public in Scotland will appreciate that this debate gives us an opportunity to consider the Scottish economy. What they will fail to realise is that there are few English Members of Parliament present, and that when the Secretary of State was halfway through his speech there were still only four or five Conservative Back Benchers willing to listen to him. The speech that I heard from the Secretary of State was one that I have heard frequently from the incumbent, whether during the previous Labour Government or this Government. Secretaries of State——

Mr. Foulkes

rose——

Mr. Wilson

The hon. Gentleman should give me a chance to develop my thoughts. He will note, of course, that his hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) refused to give way to any intervention.

In the past Secretaries of State for Scotland have tried to magnify the achievements of the Scottish economy in an endeavour to conceal its continuing rundown. I do not recognise what I have heard tonight from the Conservative Benches about the state of the Scottish economy—nor would any of my constituents or those of other hon. Members, who are unemployed—or about the hope that the Government see in the regeneration of the economy. We are grasping at peanuts, and nothing more.

I was disappointed by the hon. Member for Garscadden. The Government have at least shown some imagination in the way in which they have worded their motion when they refer to the remarkable progress made in restructuring and strengthening the Scottish economy without any facts to support it. However, the hon. Gentleman's speech was entirely negative. He failed to come up with any proposals, although he must be given credit for a small glimpse of imagination. He said that the Labour party had been in favour of Scottish oil revenues—I should say North sea oil revenues, to put it more neutrally—being used for industrial regeneration. I am therefore not surprised that he was so embarrassed by his invention that he refused to give way. The Labour party in Scotland has never claimed any specific share of the oil revenues for spending in Scotland. Under the previous Labour Government, the Treasury issued a White Paper on the subject suggesting that the oil revenues should fall within the Treasury's grasp and not be hypothecated for industrial development. That point should be put plainly before the House.

Secondly, it struck me as remarkable that the Government and the Labour party spokesman refused to take on board the critical position affecting the coal industry. We have seen the amount of coal burn decline by about 50 per cent. We know that the Torness nuclear development is just around the corner. It is not just the fall in demand that poses problems for the coal industry; it is the increasing proportion of the nuclear element and the fact that within a few years the majority share of electricity generation in Scotland will come from nuclear power without any of the benefits of a reduction in price.

In a debate of this kind, it is worth being realistic. The first fact that we must take on board is that the English economy is emerging from the recession into extreme difficulty. When the Secretary of State said that Scotland was near the top of the league table of United Kingdom areas, that was describing not so much an improvement in the Scottish position as a rundown in certain other areas of the United Kingdom.

I am convinced that the overall United Kingdom economy is in trouble and that it will be in greater trouble as the years roll by. Only this year the United Kingdom has become a net importer of industrial goods. It relies on the export or production value of oil from the North sea to help its balance of payments. If that were taken away, there would be a worrying, yawning gap, because in about three to four years oil production will have peaked and begun a steady but slow decline. That would not be important in terms of Scotland's population, but it will be in terms of the United Kingdom's population.

As the oil revenue dips, whichever party is in power in the United Kingdom, the Government will have a lower proportion of oil revenues available for industrial or any other kind of development. That will pose considerable problems for the Chancellor of the Exchequer. I do not recognise the incipient boom in expansion to which the Government have been pointing. In his autumn statement, the Chancellor said that the United Kingdom economy was recovering. There is no evidence that that applies to Scotland. I do not wish to rehearse the evidence that has been given before, but the CBI industrial survey of November this year says that business confidence seems to have slipped back in Scotland in the last four months … The volume of total new orders has continued to decline … Labour shedding in Scottish manufacturing has continued at a broadly unchanged rate. There is no evidence that this rate of demanning will fall significantly in the coming months. The latest information and statistics, produced by the Fraser of Allander Institute, do not give the impression that the Scottish economy has turned the corner and that it is leading the United Kingdom economy out of the overall decline and recession.

Mr. Michael Forsyth

I am grateful to the lion. Gentleman for giving way, because the hon. Member for Glasgow, Garscadden (Mr. Dewar) would not give way on the same point. Surely the point about the Fraser of Allander survey is that it does not include, on its own admission in today's Glasgow Herald, any data from the service industries, which it finds impossible to get. Any survey which is based on the manufacturing sector only is bound to present a gloomy picture, because the boom has come in the service sector. It is dishonest to use those figures to reflect Scotland's economic position.

Mr. Wilson

This is one of the rare occasions on which I would agree with the hon. Gentleman. The service element is a significant part of the economy. The hon. Gentleman should address the complaints that he feels necessary about the lack of statistics and data to the Government, who have not yet produced them in a satisfactory form. There is a danger that the hon. Gentleman and other Conservative Members will start to talk about the expansion of the service sector. It may be, as oil has brought advantages to Aberdeen and Grampian., that Edinburgh has shown some improvement in the service sector, but many other parts of the country, which would welcome more service industry expansion, are not seeing it.

To continue the point made by the hon. Gentleman, it is probably in the service sector that the small industries will make the greatest contribution, given the time lag between a small business starting in manufacturing and its being able to grow to a significant size. The Government have failed to take into consideration the traumatic experience, which I have had in Dundee and which other hon. Members must have had in their constituencies, of seeing large firms, perhaps in the engineering and mechanical industries, suddenly imploding with that loss of thousands of jobs. We know that the electronics industry, welcome though it is, will find difficulty in making up for the loss of those jobs and in maintaining the levels of employment, if we are to believe some of the information given to the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes).

The Government have to accept responsibility for the overall management of the Scottish economy, so let us examine public expenditure. The Government must tell the House and the Scottish people why Scottish Office expenditure is declining—and declining at a rate faster than ever I had expected. From 1979–80, it was 6 per cent., but from 1983–84—the time of the autumn statement—it has gone down to 5 per cent. That is a £1,289 million loss this year if we are to apply the 1979–80 percentage to the 1983–84 expenditure plans. In real terms, Scottish Office spending has declined from £6,450 million in 1979–80 to £6,339 million in the autumn statement for 1983–84.

I do not suppose that hon. Members would see anything vindictive in those figures, which I can only describe as disgraceful. Perhaps it is due to the workings of the mysterious Barnett formula. It is the result of a feeble regime in St. Andrew's house, and a Scottish Secretary of State who does not have the wit, will or ability to defend Scotland's interests. It is ironic that on the very day that the Chancellor was forced to admit yet another £1 billion windfall from Scottish oil the public expenditure plans revealed a £1 billion embezzlement of Scottish public finance. We must remind ourselves that the Barnett formula, which was arranged during the time of the previous Labour Government, has removed the ability of the Scottish Office to negotiate its appropriate share of expenditure on the basis of need.

As the right hon. Member for Glasgow, Govan (Mr. Millan) dealt with the problem of regional policy, obviously there are moves afoot. The Government are engaged in what can only be described as a transparent propaganda campaign on regional aid. There was an inspired leak that it would be abolished or diluted severely. On 24 November, the Glasgow Herald, through more inspired leaks, reported that spending Ministers and the Scottish Office had won a victory—that word should be in parentheses—and regional aid was to be retained. Scottish opinion is being softened up for a further decline in a programme that has already declined 40 per cent. in real terms, comparing the last two fiscal years with 1975 and 1977. Even in the heyday of the 1960s, Scottish Office expenditure did not represent a significant redistribution of resources within the United Kingdom.

I remember when the regional employment premium was curtailed within six weeks. One of the firms in my constituency got the news from Grampian television, because it had suddenly been released without any consultation. We were repeatedly reassured in answer after answer that there was no doubt but that the quantum would remain the same and that the new selective scheme that had been introduced would lead to opportunities for Scotland. Although it took two years for the figures to come through, they showed that there was a dramatic downturn in the Scottish share, because it had relied on the regional employment premium.

Propaganda rather than substance has been the mark of this Government's attitude, and that has been displayed in the debate. I understand that the Government are considering changing the Scottish Economic Planning Department to the Industrial Department for Scotland. I see the Minister indicating assent. I am not surprised that the name has been changed. Since when did the Scottish Office have any responsibility for economic planning? It has brutally, and honestly on this occasion, trimmed down what should be its function to one that is purely aid to industry. We require the formulation of an economic strategy for Scotland, but unfortunately we are not getting it.

I come now to the announcement in the autumn statement on housing benefits. Scotland has a low proportion of owner-occupation. The Government are not trimming the mortgage subsidy, but they are trimming the housing benefit, and that is of more importance for Scotland.

The fuel price increases that are being introduced will impinge most heavily on the sick, the unemployed and the elderly, and, because of our climatic conditions, they will obviously have more impact on Scotland.

I do not see any opportunity for improvement. If I could, I should be the first to admit and recognise it, because I do not wish to see my country exposed to economic decline. Although there have been some improvements, the overall trend within the Scottish economy has been unhelpful. It is a source of international, not just Scottish, amazement that Scotland, the world's fifth largest oil producer, a country that can claim to be the European centre of the electronics industry, an area with higher industrial productivity than in the United Kingdom as a whole—for a reason that many of us do not approve, namely the elimination of weaker brethen, causing large-scale unemployment—and a country with a skilled and flexible workforce should suffer the profound economic and social distress that is visited on the Scottish people.

The answer to this appalling paradox is political rather than economic. Here I come to the heart of the Scottish problem. Scotland is ruled—perhaps passively, perhaps by agreement or consent—by an occupying power. In the last election, as in the 1979 election, the English Conservative party and its Scottish surrogate were decisively rejected by the Scottish electorate. Yet that same electorate is ruled by the people that it rejected. The experience of 1979 had a profound effect on many hon. Members, particularly the Labour party. The prospect of a repeat in 1983 of the events of 1979 led to a number of Labour party members—some of whom had been here and had been vocal, but are not here now—promising to disrupt the House of Commons and its Committees to force the Government to recognise Scotland's legitimate right to self-government.

In recent weeks there has been a blank refusal to accept that Labour has a special and leading place in the representation of Scottish interests. On the Scottish Standing Committees, Labour Members have been outnumbered by Conservatives. We have the ridiculous situation that the Labour representation on the Scottish Affairs Select Committee has been reduced to a rump. Despite consistent provocation, it appears that the dogs of war have lost their bark and——

Mr. John Home Robertson (East Lothian)

Wait for it.

Mr. Wilson

The hon. Gentleman says "Wait for it." We have been waiting in vain for action, and the hon. Gentleman and his colleagues have done nothing. Some of them have accepted shadow Cabinet positions as the price for selling their responsibilities. I have waited in vain, but I am forced to the conclusion that Scottish Labour Members lack both guts and will. They have a mandate, but they are frightened to use it.

No amount of devolution or Scottish Assemblies will provide the answer to Scotland's economic problems. The Treasury will never allow decentralisation of economic power. The Labour and alliance parties do not recognise that they are guilty of massive self-deception. As the Scottish National party amendment shows, only when there is an independent Scottish Parliament, with control over the Scottish economy, will our economy improve and the Scottish people find prosperity. Until that day comes, useful though these debates are, we shall receive only words and a further decline in our prospects for the future.

6.20 pm

Mr. Allen Adams (Paisley, North)

Perhaps the funniest speech we heard today was that of the hon. Member for Strathkelvin and Bearsden (Mr. Hirst). If I heard him correctly, he said that Scotland was a centre of capitalism. For the people in the bars in Rose street at 1 o'clock on a Friday afternoon, the advocates in Scotland's parliament building in Parliament square, and the accountants and lawyers who frequent the city, I am sure that Scotland is a centre of capitalism. It is a pity that the Scottish people do not agree. It is tragic that at the last election Scotland elected 41 Labour Members—41 Socialists. Perhaps there were not many from Bearsden, and perhaps not many from Edinburgh, but we had an outstanding victory. I stress that it was not a singular victory; it was not a one-off victory.

Mr. Hirst

rose——

Mr. Adams

If the hon. Gentleman will sit down, I shall allow him to intervene in a minute. It is one of many victories that have taken place consistently since 1945. The Scottish people have said consistently during those years that the values that Conservative Members represent and advocate are totally abhorrent——

Mr. Hirst

rose——

Mr. Adams

—to the vast majority of the Scottish people, who want a voice and a say in their own matters. I shall come back to that subject in a moment.

The whole thrust, tenor and direction of the arguments that we have heard from the Conservative Benches throughout this debate could be summed up in the words of the late President Harry S. Truman, "Save a buck and sacrifice the people". That is what this Government are doing. I am sure that the Tory-controlled council in Lochgilphead will be turning somersaults at the thought of saving a penny on the rates. I am sure that the Lothian regional council will be turning somersaults at the thought of taking concessionary fares away from old age pensioners. No doubt they will be ecstatic in Grampian that grannies cannot get a home help. Is that something to do proud of? I do not think so; nor do the Scottish people think so. We on the Labour Benches believe that those services are necessary in a decent and civilised society. We have to pay for them. We must never retreat from that position.

Unfortunately—or perhaps fortunately for the rest of us—the Secretary of State for Scotland, who of course does not command a majority of seats in Scotland, has now left the Chamber. One might hope that he has perhaps left the country. In fact, I am sorry that he is not here. He spoke this afternoon rather obscurely about the exportation of shawls. I am not quite sure where they are exported from in Scotland, but I do know that the exportation of shawls in Scotland started in Paisley. In fact, Paisley was built on the textile industry, and the textile industry itself was originally built on the production and sale of shawls.

Only 40 years ago—perhaps this is a good indicator of the decline of the Scottish economy, and perhaps of the British economy and the economy generally—20,000 people worked in the textile industry in Paisley. Today, only 1,500 people work in the textile industry in Paisley—a magnificent success story, certainly when one remembers that during the past three years that industry in Paisley has lost 3,000 jobs. That is one industry alone, the industry that the Secretary of State mentioned this afternoon—the exportation of Paisley shawls.

It is my belief, and it is certainly the belief of my party in Scotland, which has passed resolutions year after year, that the solution to the problem in Scotland is to establish a Parliament in Edinburgh with tax-raising powers. I hope that all Opposition Members agree with me when I say, and I repeat unashamedly, that the solution—or one of the solutions, perhaps the major solution—to the problem of the Scottish economy is a Parliament in Edinburgh with tax-raising powers. Scottish accountants in the Labour party have said that time after time.

Mr. Wilson

rose——

Mr. Adams

I shall give way in a moment.

The question must now be put to the Scottish Labour party and the Scottish Trades Union Congress, "What exactly do you want to do about it?" We must realise that we are grossly outnumbered in this House. Frankly, the solution lies in their hands.

We in the Labour party have been saying that for a number of years now, and the strong feeling is coming to the boil, largely because of the way that we have been treated in the House by the Government over the past four years. The Scottish Labour party does not want to hurt anyone or to take assets away from anyone, but we want to express ourselves in our own way. Only when our priorities are treated as the first and main priorities, and not as secondary considerations, will Scotland come out of the economic mess in which it now finds itself.

Mr. Wilson

I thank the hon. Gentleman for giving way. I agree with him that the problem of the Labour party in Scotland has been its ability to pass resolutions on this subject but not to enact them. I agree with what he says about the need for a Scottish Parliament with economic powers, but why did not his party's spokesman, the hon. Member for Glasgow, Garscadden (Mr. Dewar), mention that subject?

Mr. Adams

The hon. Member for Dundee, East i Mr. Wilson) will have to ask my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar). I think I said that the Scottish Labour party has already made its position clear. It is now a matter for the Scottish Labour party to ask hon. Members to implement the party's policy. All hon. Members can count. We know the situation. My party and the Scottish National party can pass resolutions, but what effect can we give to these resolutions with only 71 or 72 Members?

The Government's claim about an economic success story in Scotland is truly laughable. From the record of the Government of the past four years in three constituencies, Paisley, North, Paisley, South and Renfrew, West and Inverclyde, we can tell the Government how many jobs have been lost. We have lost 4,000 jobs at Talbot, 1,500 jobs at Coats Patons, 500 jobs at Chivas, the whisky manufacturers, 1,000 jobs at Babcock and 500 jobs at Rolls-Royce.

Mrs. Anna McCurley (Renfrew, West and Inverclyde)

rose——

Mr. Adams

We have lost 500 jobs at Craigs in Paisley, and another 500 at Brown and Poulsons. In the constituency of the hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley) 2,000 jobs have been lost at India Tyres. At the royal ordnance factory at Bishopton we reckon to lose perhaps 1,500. If that is a success story, perhaps the Government would explain to us their concept of failure because I calculate that in three constituencies we are talking of the loss of nearly 14,000 jobs.

Only yesterday I met shop stewards from the National Union of Railwaymen in Paisley who tell me that there is a threat to another 200 or 300 jobs in the west of Scotland area with the possible closure of stations at Saltcoats and Fairlie, with the possible reduction of staff in Ayr, the constituency of the Secretary of State, with the possible reduction of staff at Wemyss bay and the possible closure of Wemyss bay station and the possible reduction of staff at Gourock in Paisley.

If this were a Government intent on building up industry and commerce in the west of Scotland, one reasonable way would be to maintain and safeguard the infrastructure, the roads, rail and airways. We want to hear from the Secretary of State and the Government tonight a clear and specific undertaking that the jobs in British Railways will be safeguarded and there will be no closure of stations in the west of Scotland.

I would also like to hear about the future of Ardrossan harbour, one of the two remaining links with Northern Ireland.

I also wish to hear from the Secretary of State, who tried to paint an image of a technological revolution in Scotland, about the future of aircraft maintenance in Glasgow. Other hon. Members have referred to modern industries. The Secretary of State cannot describe that as an outdated heavy industry. Can the right hon. Gentleman give the House some guarantee that if British Airways intended to remove Trident maintenance from Glasgow to Heathrow he would intervene and try to remonstrate with the board? These are very highly skilled and technical jobs whose loss would not benefit the Scottish economy.

The issue that hon. Members should be raising is that of Scotland's control over Scotland's affairs. I hope that many of my hon. Friends will say it is time that Scotland and the Scottish people made it known that we are fed up with the rule imposed upon us which we have demonstrated clearly since 1945 we do not want.

6.34 pm

Mr. Michael Forsyth (Stirling)

The Opposition, as usual, have tried to blame everyone for the defects and problems in the Scottish economy. They have tried to blame the Government for not pursuing the irresponsible Socialist policies of inflating the economy which they advocated unsuccessfully at the last election. The Opposition have tried to blame the financial community—the investors—for seeking opportunities overseas, foreigners for withdrawing their investments from the United Kingdom and, most of all, the public for not buying British and they have suggested once again that the Government are at fault for not facing up to that problem by bringing in protection. The Opposition have tried to blame everyone but the real culprits, who are themselves.

Opposition Members have even sought to exaggerate the problem. It was noticeable in a number of Opposition speeches that hon. Gentlemen refused to give way when they were making statements about the state of the Scottish economy and how bad it is, statements that they knew were not entirely well founded. The statement in the Fraser of Allander Institute report, it was said, reflected a fair measure of the success of the Scottish economy, yet it included no mention of service industry, which is a condemnation of the Labour party's amendment. That amendment is a disgrace. It makes no mention not only of the service sector but of tourism, the two major sources of employment in Scotland.

We have all known——

Mr. Maxton

rose——

Mr. Forsyth

No, I shall not give way. I shall treat the hon. Gentleman with the same courtesy as that accorded to me by the hon. Member for Glasgow, Garscadden (Mr. Dewar).

We have all known that the Scottish economy, since the first world war, has been over-dependent on traditional heavy industries. We have all known since the first world war that the modern consumer industries would have to replace these traditional industries and that the service sector would have a part to play. We have all known that the wasteful restrictive practices which are endemic in Scottish industry would have to be abandoned. We have all known that people would have to change their jobs more often. Every one of us has known that the only way to enjoy a prosperous future in Scotland is to accept change. Opposition Members know this as much as hon. Members on the Government Benches.

What have the Opposition done? They have taken every opportunity to frustrate change and to hold back progress in support of the status quo, whatever the cost. They have adopted the role of "reactionary" in the worst possible meaning of the word. The Opposition sometimes speak as if they support every sit-in, resist every redundancy and challenge every closure. That is an entirely understandable approach to politics for them because those whose jobs are threatened have votes and their unions have power within the Labour party. If resisting economic change makes electoral sense, then it reinforces itself because the low wages and the unemployment that result can be blamed on the wicked Tories.

Instead of leading their supporters to acceptance of change and persuading them of the importance of progress, Opposition Members have made a career out of reaction and invested their extremely limited political capital in dead-end jobs in dead-end industries. They have piled folly on folly by adopting the unthinking belief that any problem can be solved by spending more and more of other people's money. They have even infected others with their costly greed.

Several industrial disasters that the Government have had to tackle had their origins in the dabbling of the Opposition's distant predecessors. If Scotland is held back by an old-fashioned economy, if Scotland is handicapped by outdated attitudes, if too many people are fighting the battles of the 19th century instead of meeting the challenge of the 21st century, the Opposition and their lamentable lack of leadership are largely responsible. Had the Labour party been able to influence events in the previous century as successfully as it has in this century, we would still be employing people in the Highlands to produce charcoal by smelting iron taken from bog ore. One lesson that we can learn from the past is that politics and business do not mix.

No doubt those who invested millions of pounds of public money in Linwood, Fort William, Invergordon and all the other places believed sincerely that the creation of growth sectors would help the Scottish economy; but the plants are closed, the new jobs have gone and the money has gone. Who knows what profitable projects that money might have financed had it been left in the taxpayers' pocket? No doubt those who introduced selective employment tax genuinely believed that it would help manufacturing industry, and that it would penalise the service sector. It certainly penalised the service sector by destroying thousands of jobs and potential jobs, but it did not do much good to manufacturing industry. Who knows how many jobs we might have had but for that misguided measure?

No doubt the Governments who bailed out bankrupt businesses believed that they were helping to avoid hardship, but all that they did was to drag out the inevitable death throes and keep people in lower-paid jobs, in poor working conditions and with no hope for the future. Who knows how many growing new industries were held back because the skilled labour that they needed was unavailable? The practical examples are endless. Political interference in industry has cost money, jobs and growth.

In the 19th century Scotland prospered with the qualities that are endemic in the Scots, as my hon. Friend the Member for Strathkelvin and Bearsden (Mr. Hirst) said, of initiative and enterprise. Scotland exploited a wide demand for the products of its heavy industries. After the first world war that demand declined and, aided and abetted by well-meaning but wrong-headed politicians, workers and managers fought to preserve out-of-date factories and ruinous restrictive practices, to cling to the impoverished way of life that they knew rather than to seek the prosperity that a rapidly changing world offered. Sixty years later the problems are still with us. Businesses that should have closed their doors decades ago are kept alive by massive transfusions of taxpayers' money and the moral support of politicians who should know better. The role of Government in the Scottish economy, if there is one——

Mr. Dewar

Will the hon. Gentleman give way?

Mr. Forsyth

I shall not give way. The hon. Gentleman would not do me the courtesy of giving way during his speech.

The role of Government in the Scottish economy lies in removing the restrictions that inhibit change, the planning controls that stifle the growth of small businesses, the employment legislation that penalises those who would take on an extra worker, the wages councils which price people out of jobs, the education system that leaves so many of our youngsters almost unemployable, and the taxes that bleed profitable businesses to prop up their ailing competitors.

Mr. Maxton

If that is the case, why is taxation now higher than it was in 1979?

Mr. Forsyth

At every opportunity the Opposition press the Government into spending more money, and because we have a moderate and responsible Government they respond to those demands. I am trying to point a way of achieving growth other than by increasing taxation.

All of the areas in which the Government are trying to remove restrictions and regulations are areas where the Government can and should act, but more important are the areas where they should not act. Each pound spent on a declining industry is a pound lost to an expanding one. The provision of a financial crutch for lame ducks and life support systems for dead ones deprives new businesses of the capital, workers and customers that they need. We preserve the past in Scotland by sacrificing the future. and it is a bargain for which our children will curse us.

Mr. Dewar

I take the hon. Gentleman's point that there are many factories open now in Scotland which the hon. Gentleman believes should be closed, and which are a drag upon the Scottish economy. Obviously the hon. Gentleman has given much thought to his thesis, and must have looked round Scotland and itemised those plants and factories that he believes should be closed. Will he give us one or two examples?

Mr. Forsyth

If the hon. Gentleman takes the point, he will be as aware as I am of the factories that should be closed. [HON. MEMBERS: "Oh"' I was talking about industries rather than factories.

So that they can oblige the hon. Member for Glasgow, Cathcart (Mr. Maxton) in his desire to cut taxes, the Government must not only turn down the drip feed of public funds, but they must abandon the delusion that electoral victory gives an insight into industry and an expertise in business far superior to that possessed by those who make their living from it. That is the point which the hon. Member for Dundee, West (Mr. Ross) has been trying to make from a sedentary position. I have not met many successful business men, industrialists or financiers who are willing to sacrifice their successful business careers for a career in politics, let alone for a job in the Civil Service. No Government, however able or well-meaning, can hope to succeed where experts refuse to invest. Decades of disasters have demonstrated that truth all too clearly, and practical experience shows that locating new factories for the benefit of election prospects seldom benefits the business., means that the Government have a continuing financial commitment to keep plant alive, and inhibits the development in the area of viable new businesses.

Our aim must be the development and growth of a specifically Scottish economy. On the radio this morning the BBC's economics correspondent, Peter Clarke, said that today the House would debate a Scottish economy that really does not exist. In a sense, he was right. We must create a Scottish economy. My hon. Friend the Member for Strathkelvin and Bearsden said that insurance, banking and finance are playing an increasing part in our economy, with about 90,000 people finding employment in those industries and in tourism. Scottish investment trusts now fund about one third of all investment in the United Kingdom. There is potential in Scotland that has been marked by the launch of a new merchant bank and a new licensed deposit taker.

However, we should go further and create new Scottish companies, mainly with Scottish shareholders, by privatising nationalised companies and organisations such as the Scottish electricity boards, the Forth and Clyde port authorities, the Scottish Transport Group and the Forestry Commission. We should free them from the control of Ministers and civil servants, and seek a relaxation of Treasury and Bank of England control over the Scottish banking system. There may be a case for the central bank having an informal arrangement with the Scottish banks, but there is no case for the rigid controls imposed by the Bank Notes (Scotland) Act 1845. Before 1845 the Scottish banks enjoyed freedom of action on the currency, which was neither abused to harm the public nor misused to threaten the unions. There is no reason why that freedom should not be restored. The developments in the Edinburgh financial community, were such a move to be made, would be highly significant in employment terms, and we could develop a money market in Edinburgh or even in Glasgow. In the short term the rights enjoyed by the older Scottish banks to issue their own bank notes, under the watchful eye of the Bank of England, should be extended to the new banks, including the trustee savings banks. I hope that my right hon. Friend will take up this matter with my right hon. Friend the Chancellor of the Exchequer.

Too much of the Scottish economy has been dominated by government, national and local, and too much has been controlled by the politicians. It is not the different ways that they have exercised that control that should be at issue in this debate but the very existence of that control. Of course, Opposition Members will preach doom and gloom. They will scratch around for every indicator that things are getting worse. They will forget the projections that they made during the election campaign. Of course we can expect nothing but the policies of despair from them because that is all they have to offer. They demand that we fight to the last taxpayer to defend declining industries and to protect the unprofitable ones. In the tattered tradition of General Ludd, they are frightened of change and fearful of the new freedom that it can bring.

The tragedy of the past 60 years is that those self-same, negative attitudes have dominated Scottish politics, delaying or completely destroying desirable development. They must not be allowed to do so in the future.

6.50 pm

Mr. Alexander Eadie (Midlothian)

The Secretary of State for Scotland is present and will have gathered by this time that the Opposition are anything but impressed by his statement to the House on the Scottish economy. There was a remarkable inconsistency in the right hon. Gentleman's remarks. Only recently his right hon. Friend the Chancellor of the Exchequer unveiled the autumn statement, which clearly showed the "progress" that the Treasury sees in the economy. It was predicted that there would be no economic growth, that unemployment would not diminish, and that inflation, the reduction of which was the great prize that was dangled before the nation, would probably decrease to 4.5 per cent. I am sure that the House will agree that that is depressing news, but things are even more depressing than that.

I noticed that the Fraser of Allander Institute was mentioned during the debate. That is not the only institute or economic organisation that makes economic forecasts. What has the National Institute of Economic and Social Research said about the economy? It said that if the Government's policies are continued we will have, in 1984, probably 200,000 unemployed and an increase in inflation to about 7.5 per cent. Those forecasts come not from the Labour party but from an economic institution that does not share the Government's optimism. If we apply the usual 10 per cent. to that 200,000 figure, we shall have 20,000 more unemployed people in Scotland next year. If I were the Secretary of State for Scotland, I would be very concerned about the position.

Mr. Hirst

rose——

Mr. Eadie

The hon. Gentleman has already made his speech and I wish to make mine.

The Labour party is not producing these gloomy forecasts, as has been suggested during the debate. I notice that John Davidson, the chairman of the CBI, who has been criticised in the House as being an echo of the Conservative party in Scotland, has said that we may have two economies in Scotland come 1984. He went on to suggest that 1984 would probably bring severe competition, which could be fatal for some industries in Scotland. One cannot have a forecast gloomier than that. That shows the seriousness of the position in Scotland and the complacency of the Secretary of State in dealing with it.

Has the right hon. Gentleman considered the serious nature of Scotland's present economic position? The House may recall the campaign in Scotland during the mid-1970s which referred to "Scottish oil". The right hon. Gentleman will be aware of how that campaign influenced some people in relation to what was happening to Scottish oil in the economy. The reply was—we all gave that reply—that it was British oil. It was also said that we would gain an advantage because it was British oil and we were British. We were told that the economy would be topped up because we were members of the United Kingdom——

Mr. Younger

indicated assent.

Mr. Eadie

I see that the Secretary of State is nodding his head in approval.

I wish now to deal with the issue of energy in Scotland. The right hon. Gentleman was good enough to give way to me earlier and I appreciated that. I referred to coal burn in Scotland in relation to the South of Scotland Electricity Board. The right hon Gentleman must be aware of the figures. He knows that it has been suggested that coal burn in Scotland will be reduced from 6.2 million tonnes to 3.8 million tonnes, although the National Coal Board has suggested that, if a little is added to that, it might be only 4.8 million tonnes. The reduction is explained by the economic recession to which the right hon. Gentleman referred in his speech, by the consequences of the closure of Invergordon, the fact that we have increased our nuclear power capacity and by the difficulties in generating electricity. But the right hon. Gentleman cannot gainsay the fact that the announcement of the South of Scotland Electricity Board is serious. A reduction of 2.8 million tonnes in coal burn will mean the closure of five Scottish pits and the loss of 4,800 jobs.

A reduction of 1.7 million tonnes coal burn will mean that 3,000 jobs in Scotland are in danger. It must be said time and again that if there is to be a resurgence in the Scottish economy we must have a strong coal industry, a strong steel industry and a strong railway industry. Unless those basic industries are strong, there will be no resurgence of the Scottish economy. What does the Secretary of State propose to do about this serious position? It is not good enough for him to say complacently that in two or three years' time, when Peterhead stops using the gas condensates, 6 million tonnes will be burned. What about the interim period? One cannot put miners on the scrap heap just like that—nor can one just close pits and expect, with the wave of a magic wand, to resuscitate them later. When a pit is closed, it is closed for all time. The right hon. Gentleman has a responsibility to ask the Minister who is to reply to make a statement about the serious reduction in coal burn by the South of Scotland Electricity Board.

When the Secretary of State was talking about Scottish coal he came close to describing it as a national heritage. In previous debates on oil we have described North sea oil as a heritage fund. Contrary to the ridiculous statements made by Mr. MacGregor, we have an abundance of coal in Scotland. It is the only fossil fuel that Scotland has in abundance. For example, there are the Musselburgh bay reserves. I signed an agreement in 1978 that led to development at Mussleburgh bay. There are the Happendon reserves. In addition, there is Auchendinny, Comrie, Sorn, and the Cannobie coalfield, which I know the right hon. Gentleman knows something about. That coalfield probably extends into Cumberland. We have rich coal reserves. Mr. MacGregor has suggested that all the best coal in Scotland has already been worked. The chairman of the National Coal Board should obtain proper advice before he makes such statements in Scotland.

When the Secretary of State responded to my earlier intervention he talked about investment in the coal industry. I suggested to the right hon. Gentleman that to some extent he was the custodian of the Scottish economy. I suggest that he should inquire into investment in the coal industry in Scotland. Since the Conservative Government took office in 1979 not one new pit has been sunk in Scotland. When the Under-Secretary of State replies I hope that he will not mention Castlebridge. I attended the sinking of Castlebridge when I had ministerial responsibility for coal. There has not been a new pit sunk in the United Kingdom since.

I hope that the Secretary of State is aware of the distribution of the investment that has taken place. As I said last week in a coal debate, 81 per cent. of the investment in the industry has been directed to Yorkshire, the midlands and surrounding areas. The remaining 19 per cent. of the investment has been distributed in what has been described as peripheral coalfields. These fields are in south Wales, Leicestershire, part of Derbyshire, Durham, Cumbria, Northumberland and Scotland. The 19 per cent. has been divided between them all and it seems that Scotland has been treated as a peripheral coalfield. I suggest to the right hon. Gentleman, as I suggested to the Secretary of State for Energy last week, that the consequence of a policy that excludes new pit sinkings and new investment will be a contraction of the coal industry in Scotland.

The Secretary of State will probably say that Opposition Members should be making constructive contributions. We are ideally poised in Scotland to take advantage of our coal reserves. It is in our strategic and economic interests to develop the coal industry. There is the opportunity to introduce liquefaction, and dual processing could be introduced at Grangemouth. When discussing the liquefaction of coal we are not talking about a new technical process, because we have been reprocessing for years. We are talking about a new raw material that could be derived through coal. We could go ahead with the developments that were bequeathed to the Conservative Government in 1979.

If those developments had gone ahead, the pilot plants would be ready and we could enjoy the commercial liquefaction of coal. I suggest to the Secretary of State that he should stand up for Scotland. He should stress that Scotland is rich in coal reserves. The Scottish people want to take part in the experimentation of the liquefaction of coal, because Scotland is ideally suited to be a part of such an experiment. Therefore, Scotland is entitled to its share of the allocation of resources that will be necessary to get the research and development project under way.

Mr. Forsyth

rose——

Mr. Eadie

I shall not give way as I want to bring my remarks to a conclusion as quickly as I can.

The Secretary of State must be aware of the exciting new developments at Westfield. We have already broken through the barrier of producing synthetic North sea gas and it is already being produced at Westfield. We know that we have coal in abundance and the North sea oil production will be reduced to a trickle at the end of the 1990s. The reduction of that supply will be accompanied by a diminution of the capacity to produce North sea gas. We should be grabbing the new opportunities that are inherent in the gasification of coal, coal being one of Scotland's richest assets.

I hope that the Secretary of State will not ask the Under-Secretary of State to deal only with the economics of coal gasification. We have invested millions and millions of pounds in the gas pipeline throughout the country and when the supply of North sea gas starts to diminish we shall want to continue to capitalise on that investment. h would be nonsense to wipe away that investment, and that is why we want to introduce the gasification of coal.

The right hon. Gentleman must fight for Scotland. Scotland has rich assets but its people are probably the richest asset of all. Scotland must have a voice in the British Cabinet. That voice should say, "As we have wealth in the North sea and in solid fuel, we are entitled to our fair share of the allocation of financial resources." Scotland is ideally poised to implement the policy of research and development, and that is why the right hon. Gentleman must stand up for Scotland.

I hope that we shall not end up in Scotland with nothing but nuclear power generation, and no coal industry when the oil industry has disappeared. That would be unacceptable to me, to the Scottish people and to my right hon. and hon. Friends. If the right hon. Gentleman wants to be constructive, he has a responsibility to say, through the Under-Secretary of State, that next week he will be prepared to meet area officials of the National Union of Mineworkers in Scotland, along with Labour Members from mining areas, to discuss how we should tackle coal burn and the broader issue of the Scottish mining industry. That would be a constructive approach and I challenge the right hon. Gentleman to issue invitations to such a meeting. Let us meet the right hon. Gentleman and determine what contribution can be made to ensure that we have a strong, viable and economic coal industry. We want to play our part in ensuring that we have a sustainable Scottish economy.

7.9 pm

Mrs. Anna McCurley (Renfrew, West and Inverclyde)

During the past two decades there has been a persistent decline in Scotland's traditional industrial base. The Labour party in opposition has a strange amnesia about what it did when in power.

The hon. Member for Midlothian (Mr. Eadie) talked about the coal industry. The Labour Government were responsible for as many pit closures before 1979 as we have been for closures of any kind in Scotland. If pits that we are supposed to keep open—for example, Cardowan—are losing £10,000 per man per annum because of inefficiency, there is a good case for closing them.

Scotland has been beset by outdated working practices, poor productivity and lack of competitiveness. The hon. Member for Paisley, North (Mr. Adams), who is just leaving the Chamber——

Mr. Eadie

rose——

Mrs. McCurley

I shall not give way.

Mr. Eadie

Come on.

Mrs. McCurley

The hon. Member for Paisley, North was talking about Paisley shawls as an industry that went into decline because nobody wanted the product. Much the same has happened in Scotland during the past 150 years.

Mr. Adams

rose——

Mrs. McCurley

The textile industry has become uncompetitive. Last week, I spoke to a leading manufacturer who uses British textiles—sometimes he uses a border tweed and certain other textiles. When I asked him why he did not use tailoring textiles, he said that it was because the British textile industry had failed to come up to date and to meet the demands of the customer. That is what happened with Paisley shawls and what is happening to our industries.

Mr. Adams

rose——

Mrs. McCurley

When the Labour Government were in power and responsible for industry, they were beginning to realise what they had not realised before—that the country was being destroyed by hyperinflation. The hon. Member for Paisley, North used a phrase by Harry Truman—"Save a buck and destroy the people".

Mr. Adams

rose——

Mrs. McCurley

I rephrase what Harry Truman said and say "Overspend a buck and destroy the people". That is what the Labour Government's policies were doing.

Mr. Adams

Will the hon. Lady give way?

Mrs. McCurley

I shall not give way.

The Conservative Government have attempted to drag Scotland into a modern industrial framework. It is heartening that, because of the newer style of industries, more people are employed in the electronics industry in Scotland than in the coal, steel and shipbuilding industries put together.

It is important that there should be a balance, but the Opposition's problem is that they overemphasised traditional industries, because those industries are their traditional power base. They refuse to accept that that power base is being eroded in the newer industries. The largest employer in my area is the microelectronics industry, which is assisting in an area that is suffering a decline in traditional industries.

The hon. Member for Glasgow, Garscadden (Mr. Dewar) talked about the deindustrialisation of the Clyde. I suggest that in my constituency there is a re-industrialisation of the Clyde. The hon. Member for Garscadden either does not understand or does not want to understand the potential in these new industries. He is a classic example of Opposition Members who think that if there is not an oil can in one hand and a spanner in the other and a massive work force it is not real industry. The Opposition fail to recognise that there are 60,000 small businesses which act as vital employers.

Mr. Maxton

What about the small industries?

Mrs. McCurley

We need a degree of resolution as well as evolution in industry.

One of the major employers in my constituency is the tourist industry. I classify tourism as a major industry and it is a labour-intensive industry. We should be counting on the service industries. The Government have an excellent record in extending finance to the tourist industry. The tourist industry provides £250 million in income for Scotland. The Minister of State said in the other place that it stimulates £620 million of purchases in our economy. It also provides 50,000 basic jobs and more are unaccounted for in the statistics. One working person in 38 is involved in some aspect of the tourist industry, and there is a great potential for more involvement. The Government's expenditure on the tourist industry has risen by 7 per cent. to a record £760 million. The tourist industry in Scotland now ranks third behind oil and whisky and could overtake them.

A Bill was presented today by the Minister of State in another place to allow the Scottish Tourist Board to promote Scotland abroad untrammelled by restraints from the British Tourist Authority. That will encourage not only extra tourism but new investment in Scotland. I especially welcome the new investment in my area.

An imaginative and highly commendable project masterminded by the editor of Greenock Evening Telegraph was for the development of the waterfront in Inverclyde. The Scottish Development Agency has agreed to a feasibility study and the tourist board of the Inverclyde district council has agreed to support the scheme. It could bring millions of pounds of investment to my area, and could provide the building industry with an immense amount of work on the waterfront housing developments and the small factory units which this type of area would attract.

The leisure industry is big business. The hon. Member for Paisley, North would be grateful if the textile industry could obtain some advantages from this scheme. Sportswear would be an important component of the leisure industry. These are all spin-offs from that industry.

Dr. Norman A. Godman (Greenock and Port Glasgow)

rose——

Mrs. McCurley

This development should be taking place. It is imaginative, practical and progressive. We should be looking towards the tourist industry as one of our most important revenue earners. This area has largely been ignored by the Opposition. I put in my bid for whatever finance the Government have for this industry in my area. It is a remarkably underdeveloped area. The Clyde has remarkable potential and could be the saviour of Scotland.

7.18 pm

Mr. Bob McTaggart (Glasgow, Central)

Yet again, we hear promises of economic recovery from the Conservatives and we are led to believe that the Government strategy is at last beginning to show results. The Chancellor of the Exchequer talked about the Government's "winning combinations". If such a recovery were really under way, if output had returned even to 1979 levels and trade in manufactures were running at a surplus rather than a £4 billion deficit, if our industries were more competitive than they were in 1979 rather than 15 per cent. less so, and, above all, if the unemployment figures showed signs of tumbling rapidly, the Opposition would certainly welcome those developments. To use the Prime Minister's infamous phrase, we might even rejoice.

We do not believe that anything of the kind is happening. Unemployment continues at the worst levels ever known in this country, our economy stagnates in the deepest slump for 60 years and on the horizon is the not-too-distant prospect of dwindling returns from North sea oil. One of the unfortunate results of four and a half years of the Government's economic strategy has been that the great opportunity of North sea oil has been missed and the revenues squandered when they could have been invested in industry.

Mr. Forsyth

Will the hon. Gentleman give way?

Mr. McTaggart

As a result, our future as a successful manufacturing and exporting nation has been seriously undermined.

The Government's record is one of failure and Ministers and Conservative Members should be deeply ashamed of it. With so much evidence to the contrary, it is incredible that Ministers still try to convince the House and the country that their policies are beneficial. Their economic strategy has failed and, as always, Scotland has paid a heavy price. Nearly 250,000 pensioners are now struggling on the poverty line, dreading the onset of every winter with its threat of hypothermia. One in five Scots now has an income at or below supplementary benefit level. The housing stock deteriorates daily while housing budgets are slashed by the Secretary of State for Scotland. Our Health Service is denied the proper resources to meet the legislative demands of our people. Our major industries are squeezed and threatened with closure.

Prolonged unemployment has become a reality for about half the men in many parts of Glasgow, as my constituents can testify. Mass unemployment has become the chief distinguishing feature of the Scottish economy in the 1980s. There can be no more depressing observation than that. As my right hon. Friend the Member for Glasgow, Govan (Mr. Millan) said, it is even difficult to arrive at a realistic and truthful figure for unemployment in Scotland because the figures have been doctored. The figures now exclude the thousands of married women who cannot claim benefit but who are unemployed and would dearly like the chance of a job. The unemployed over the age of 60 are no longer required to sign on. Further tens of thousands are excluded because they are involved in the Government's special employment and training schemes, which are all too often just one step away from the dole queue. Perhaps the Secretary of State will explain why those people cannot have the real jobs that the Prime Minister promised in the run-up to the 1979 election.

Taking all those exclusions into account, it is reasonable to suggest that under the Tories almost 500,000 Scots cannot find work. In a nation of 5 million people, that is a savage indictment of any Government. Ministers at the Scottish Office must decide how much longer they can support Government policies that are so damaging to Scotland when in the June election those policies were overwhelmingly rejected by the people of Scotland.

We have heard before and no doubt we shall hear again today the claim that there is a world recession and that what is happening to the Scottish economy is happening to all Western industrial economies. It may even be claimed that there is little that any individual country can do to overcome the problems common to all, but that argument cannot be sustained.

Earlier this year, I asked the Library to compute the number of people who would be unemployed in Glasgow if the unemployment rate were the same as those current in other Western industrial countries. The results make interesting reading. If our unemployment rate had been the same as those of Japan, Norway, Sweden or Austria, there would be between 75,000 and 80,000 fewer unemployed in Glasgow alone because unemployment in those countries was between 2 per cent. and 3 per cent. whereas it was more than 16 per cent. in Glasgow and about 15 per cent. in Scotland as a whole.

If the Japanese, Norwegian, Swedish and Austrian Governments can pursue policies that hold unemployment to 2 per cent. or 3 per cent. in the midst of a world recession, the British Government should be able to pursue policies that would significantly reduce unemployment here. All that is lacking is the political will to do so.

Mr. Hirst

Will the hon. Gentleman give way?

Mr. McTaggart

Why cannot the Government sanction the spending of public money on the many projects that are so desperately needed and would give a much needed boost to the economy and job prospects? One thinks of railway electrification and the replacement of Victorian sewers. Why do not the Government allocate to local authorities the capital to launch a massive house building and modernisation programme to meet the needs of the thousands on the council waiting lists, at the same time giving work to the thousands of construction workers on the dole? Why will the Government not sanction public spending to bring old age pensions and unemployment and social security benefit to decent levels so that recipients are not cut off by their lifestyle like so many lepers?

Mr. Hirst

rose——

Mr. McTaggart

I am corning to the point that the hon. Gentleman probably wishes to make.

It may be argued that we cannot afford to do these things. I argue that we cannot afford not to do them., as there can be few bigger spenders of public money than unemployment itself.

The Government are reluctant to talk about the real cost of unemployment. For some years now, they have published only the cost of unemployment benefit and supplementary benefit paid across the counter. Even the most casual observer knows that the true cost is far greater. There is the cost to be met from the redundancy fund. There is the extra cost in higher rate and rent rebates. There is the shortfall in tax revenue. There is the cost of all the other factors associated with mass unemployment. Recent estimates put the cost of keeping 4 million unemployed at about £20 billion per year.

The Government have a clear choice. Either they continue to waste public money keeping people out of work or they use it for specific projects to get people back to work. We need more skilled teachers to meet education demands. We need more doctors and nurses to meet the needs of an aging population. We need more houses of the kind in which people wish to live. We need better roads and railways.

Mr. Henderson

Will the hon. Gentleman give way?

Mr. McTaggart

We need more people earning and spending money to keep the economy moving. In fact, we need a change of Government—and the sooner that change comes, the better for all the people of Scotland.

7.29 pm

Mr. Malcolm Bruce (Gordon)

I appreciate being called to speak as I represent the one political Scottish force that increased its support at the general election at the expense of other political parties. I believe that our contribution to the debate—although our amendment, regrettably, has not been selected—is both positive and constructive, which, I regret to say, is more than we have had from the two Front Bench spokesmen.

The Secretary of State, by his selective use of figures and facts, was trying to give the impression that the Scottish economy was successful. I do not think that Conservative Members have referred to the fact that one third of a million Scottish people are unemployed. That figure is just about double what it was when the Government came to power in 1979. To brush that fact aside and discuss other matters is an insult to the intelligence of the House and the Scottish people.

It is worthwhile examining the background against which the Scottish economy operates. Britain, for the first time in its history, is a net importer of manufactured goods. My information is that such a state of affairs represented £1,222 million of deficit in the first half of the year—a catastrophic figure. The figure is worse when one considers that the deficit on our non-oil account has trebled in the past year and is now at an annual rate of £8,000 million. The only way that Britain, and therefore Scotland, can survive as a trading nation is by selling its goods and services to the world, and that we are clearly failing to do. That is the achievement of almost five years of Conservative Government.

We must bear in mind what Scotland can achieve for the energy industries and the role that the energy industries should be playing in the development of the Scottish economy.

Mr. Barry Henderson (Fife, North-East)

I hope that the hon. Gentleman does not intend running down the achievements of Scotland in any sense. About 30 per cent. of all Scottish products are exported. Can the hon. Gentleman name any country in the world, including Japan, the United States and Germany, that can match that achievement?

Mr. Bruce

The hon. Gentleman has intervened just as I was about to deal with that subject. If we remove oil, the British economy is in a serious position. Its trading position is weak, not strong.

The debate is remarkable in how it differs from a debate that might have been conducted in a more optimistic spirit 10 years ago. I am sure, as the hon. Member for Dundee, East (Mr. Wilson) said, that one would not think that our oil production amounts to £15,000 million per year, because it gives us no benefits. Our oil revenues support the unemployed. The Government's policies have failed to take advantage of the opportunity given to us by the discovery of North sea oil and gas.

Mr. Younger

Surely the hon. Member for Gordon (Mr. Bruce), whose constituency is in the middle of the Grampian region, did not mean that we have received no benefit from North sea oil.

Mr. Bruce

I am suggesting not that my constituents have not benefited from North sea oil developments, but that the Government have failed to take full account of the contribution of oil to the British and Scottish economies. Hon. Members have expressed dissatisfaction about other parts of Scotland not securing the benefit from North sea oil development that they might have wished and expected.

We have not even had the benefit of competitive energy pricing, even though we produce our own oil and gas. We are the largest energy producer in Europe and we charge ourselves prices at or above the world level. We are not giving ourselves even the smallest selective benefit from being such a large producer of oil and gas. The Government are directly responsible for not giving the right type of lead to enable the developments at Corpack and Invergordon to survive. The key to the failure of those enterprises was their inability to compete in energy prices with industries in other countries that gained more advantageous energy deals. I accept that the Secretary of State eventually produced a package for Invergordon, but it was far too late. Had it been presented at the beginning, we might have been able to save Invergordon.

Bearing in mind the change in the price of aluminium in the past few months—just before the closure of Invergordon the price of aluminium was £650 per tonne compared with £1,116 per tonne now, which is almost double—there is some interest in the possibility of reopening the Invergordon plant. How is the Scottish Office trying to bring that about? Is the Secretary of State prepared to offer an energy deal to any operator who might wish to reopen Invergordon similar to the one he offered at the time of the closure?

The difficulties in our economy in the past 10 years have been caused substantially by the rise in energy prices. However, the Government have not pursued a policy actively to promote energy conservation in any significant way. Energy conservation is not just an economic benefit, but an industry in its own right and one of which Scotland is well placed to take advantage. It makes use of the construction and engineering industries and building services of which Scotland has a considerable concentration. Had the Government taken a serious approach to the problem, many thousands of jobs could have been created. One estimate is that a vigorous development of energy conservation could create 70,000 jobs in Scotland.

The Government's failure to allow the British Gas Corporation to embark upon the gas gathering system has meant that the chickens are coming home to roost. The present price of gas is such that the gas gathering system would have been a viable proposition. The signs are that the volume of gas would have been sufficient to sustain the viability of the enterprise. The danger is that we shall have to import gas. By failing to develop our own gas gathering system, we have failed to provide the fabrication yards in the Highlands with the orders that they need and the steel mills in central Scotland with the orders that they could have met.

Although the Government fought for Ravenscraig—there may be a difference of view as to how strongly they fought—they would not have had to fight had the gas gathering system gone ahead, because the demand for steel would have sustained Ravenscraig through the recession.

The Government have not proposed the type of support for developing our offshore technology that will enable us to be world leaders when gas and oil production in the North sea has been exhausted.

I assure the Minister that I receive evidence from my constituents about the difficulties of developing new technology because development aid is not available in the Grampian region. I object to the attempts by other agencies to lure people to other parts of Scotland—I do not object if they are successful but their actions undermine the viability of the projects and so prevent them from proceeding. I suggest that in research and development, the specialist training required for the development of our oil and gas technology, and the development of our overseas capability, we have not had sufficient support from the Government to ensure that Britain is a world leader in offshore technology. Scotland should be looking to the offshore industry to lead the world. I do not accept the Government's argument that what they are doing in leaving development to the private sector is adequate. It is not giving us the chance to compete with countries, such as Norway and France, which are given more Government backing for their offshore industries. Although France has no offshore oil and gas production, its offshore industry is nearly as large as Britain's. That is because the French Government vigorously backed their industry.

I have deliberately and consciously concentrated on the energy industry, because I believe that it is important to and can be the basis for Scotland's future. I suggest that for the Government to give selective figures and to claim credit in areas in which they have not directly participated does not demonstrate any economic strategy for the future.

There is no sign of where Scotland's economy will be in five, 10 or 15 years. We need a strategy for economic development and the development of new employment. We have heard nothing from the Government to suggest that there will be a significant improvement in employment prospects. The people of Scotland want to know where future generations might expect to find work. That can be achieved only by a partnership between the Government and the private sector.

It was interesting to hear the hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley) taking a different view from her hon. Friend the Member for Stirling (Mr. Forsyth) about the role of the public sector when she thought that it might benefit her constituency. Her views did not square with the philosophy expressed by her hon. Friend. Constructive partnerships have made countries with which we are competing—such as Japan, West Germany and Scandinavia—successful. If we want to be successful, we must be prepared to look at what those countries do and learn from them. It is time for the Government to play a more active role in identifying the industries which, with proper backing, could succeed. We have not seen any evidence Of any such commitment from the Government.

Only one Conservative Member mentioned the problems of the rural areas. We must recognise the rundown of services and the lack of new job opportunities in the rural areas, and take that on board as part of a regional economic development strategy. The Scottish Development Agency has no specific responsibility for development in rural areas. Indeed, most rural areas have less assistance than the rural areas of England, which at least have the benefit of the Development Commission and COSIRA. No specific development has been earmarked for rural areas in Scotland.

As my hon. Friend the Member for Inverness, Nairn and Lochaber (Mr. Johnston) said, we acknowledge that the Highlands and Islands Development Board has increased demand for grants., but the Government's refusal to increase grant means that it is not sufficient to meet that demand. The SDA has no brief to provide such assistance, and it is not doing so. It is time that the Government directed the SDA to accept responsibility for development in rural areas.

Mr. McQuarrie

If the hon. Gentleman looks round his constituency, he will discover that the SDA has constructed industrial units and given considerable assistance to businesses during the past five years.

Mr. Bruce

The hon. Gentleman has not challenged my point that the SDA has not accepted responsibility for promoting employment and development in rural areas. Of course, I am not simply referring to manufacturing. Everyone knows that the maintenance of rural communities depends on providing services to allow industries to flourish.

The western part of my constituency has record unemployment, comparable to some of the worst parts of Clydeside. There is the bleak forecast of 30 per cent. unemployment in 10 years' time. That is hardly a success story, and there is nothing in the Government's package to suggest that they intend to do anything about it. It is high time that they recognised the real problems facing rural communities and the need for a positive approach. Other hon. Members and I have made representations to the Secretary of State, but we have been speaking to a stone wall.

I hope that all hon. Members recognise the need to encourage and develop the growth of small businesses. Large-scale manufacturing enterprises will not provide future jobs. The development of the service industry and new small businesses is likely to provide the greatest potential for new growth and employment. I welcome the Government's acknowledgment of that fact, but I regret that, compared with other countries, the development of new small businesses is well below what it should be. That is partly because the climate in which we operate and the general trading performance of Britain do not pull businesses through the recession.

I recognise that I cannot address my criticisms to the Secretary of State because, at the end of the day, he is dependent on the economic strategy pursued by the Chancellor of the Exchequer—an economic strategy that has produced record unemployment and a trading catastrophe. Nothing that the Government say suggests any way out of that problem. If we cannot trade profitably as a nation, we shall not survive.

The figures that I quoted earlier show that we are failing to pay our way in the world. Unless we can do that, we shall be bankrupt. The Secretary of State's statement today left out all the embarrassing facts about the one third of a million unemployed in Scotland. He failed to address himself to the future. He gave no sign of what the position might be in five or 10 years. He simply asked us to trust him, and all would be well. But the record of the past five years does not persuade me to do that. That record might explain why support for the Government and for other parties in Scotland fell at the general election and why support for the alliance rose by 300 per cent.

7.46 pm

Mr. Gerald Malone (Aberdeen, South)

I am glad to have the opportunity to speak in this important debate. I am sorry that I did not hear the speech of the hon. Member for Glasgow, Garscadden (Mr. Dewar) because I was engaged on Committee work. I understand that I missed a part of his speech that supported what the Government have been doing since 1979—I refer to the Opposition amendment, which calls on Her Majesty's Government to reverse policies which have struck both at the traditional heavy industries and those based on the new technologies". Since the Government were elected in 1979 they have attempted to reverse the decline brought about by successive Socialist Governments. I congratulate the hon. Member for Garscadden on including that congratulatory element in the Opposition amendment.

This is a vital debate for Scotland, and especially for the north-east of Scotland. I wish to highlight several aspects of the Government motion, the first being the North sea oil industry. The Government have given a great boost to confidence in the exploitation and future development of North sea oil since they were re-elected in June. At that time there was a slight lack of confidence in the oil industry as a whole and development was being held back. With the passage of the Petroleum Royalty (Relief) Bill, the oil industry will receive much-needed encouragement.

The news from the North sea has been good during the past quarter. Three more fields have come on stream—Brae, Magnus and Maureen, and development plans have been approved for one other field. It is not an exaggeration to say that, as a result of the Bill, 30 new fields will be encouraged. Those fields are marginal, and would not have been developed without that legislation. The Government deserve congratulation for that.

The effects on the Grampian region during the past few years of the Government's North sea oil policy have been clear. Until June there was a significant increase in oil-related jobs in the Grampian region. In Grampian, 6,300 new jobs have been created in the oil-related sector in that short time. That represents an increase of 16 per cent. for the rest of the Scottish economy. There has been an increase of 8.5 per cent. in oil-related jobs. Therefore, the Government have presided over a success story in that industry. Hon. Members on both sides of the House should be grateful for that.

While I have listened to the debate, I have wondered whether Opposition Members know what they are talking about when they discuss North sea oil and when it will run out. They suggest that it will run out by the 1990s or the turn of the century. Their view is not shared by oil companies, which are investing heavily in the North sea and the Grampian region. They believe that development of North sea oil will continue well into the next century. The north-east of Scotland enjoys plans and investment to bring North sea oil in for some 30 or 40 years. It is worth bearing in mind that projections about North sea oil reserves have been pessimistic rather than optimistic.

We were told that we should reach the peak of production in the early 1980s. That peak will not be reached until between 1985 and 1990. Moreover, if the Government continue their sensible policies of making fields economically viable by changes in the tax structure, there are sufficient fields to enable North sea oil development to continue far beyond the turn of the century. We must all be grateful for that.

Mr. McQuarrie

My hon. Friend might have made a small error when he referred to the number of jobs created in 1983. Oil-related jobs increased from 34,000 in 1978 to 63,000, not 6,300 as my hon. Friend suggested.

Mr. Malone

I am sorry if I misled my hon. Friend. I intended to say that the number of new oil-related jobs in Grampian region in 1982–83 increased by 6,300. I was not referring to the total number of jobs in the oil sector.

There are other encouraging signs in the North sea oil development story that could be related to other parts of the Scottish economy. One is that the north-east of Scotland is beginning to enjoy not just the benefit from subsidiaries of companies being set up there. Such companies are bringing their entire infrastructure to the area. They are setting up their headquarters and decision-making processes there.

International Drilling Fluids is just one company that has decided to concentrate all of its production, development and capacity in the north-east of Scotland. The number of companies that decide to do that will increase. That is encouraging for the simple reason that, when North sea oil begins to run out, we shall have a base upon which we can export technology to other areas that are developing offshore oilfields. The trend that I have described is growing and is to be welcomed.

The north-east of Scotland has not been reluctant to train its own young people to enable them to participate in the development of North sea oil. Schemes have been set up by Shell in conjunction with Grampian regional council. The result has been four-year training schemes for offshore technicians. Companies coming to the area can therefore take advantage of a local and qualified labour force. That, too, is most encouraging.

During the past few years the supply industry has flourished and there is every sign that it will continue to do so. However, there is one cloud on the horizon, which the hon. Member for Linlithgow (Mr. Dalyell) mentioned. As the supply industry in the North sea has developed, there have been cases of competitors being unfairly subsidised and undercutting our indigenous industry.

The hon. Member Linlithgow hit the nail on the head when he pointed out that the Norwegians are a classic case in point. By giving tax allowances for those who build supply vessels, they encourage the employment of those vessels at grossly uncompetitive prices. They are now intervening in the North sea supply market and might render a substantial number of our companies unprofitable. For proof it is necessary only to examine the daily rates for chartering supply vessels. Once, such a charter would cost £3,000 a day. Now, the going rate for such a vessel at Aberdeen can be less than £1,000 a day. The result is that many companies are now forced to put boats out at unprofitable rates of charter. That might lead to our supply industry being severely damaged.

Mr. Dalyell

I have written formally to the Secretary of State suggesting that, on the Norwegian tax regime, he should contact Mr. Richard Tookey, president of the General Council of British Shipping and Shell International Marine, and Mr. Bill Menzies-Wilson who is chairman of Ocean Transport and Trading Ltd., who are experts in these matters.

Mr. Malone

I am sure that my right hon. Friend will more than welcome constructive suggestions. This is a matter of great concern.

The Offshore Supplies Office has said that 70 per cent. of services in the North sea are supplied by British industry. I am not convinced that that explains the matter. Indeed, I believe that something is being concealed. Concealed in that 70 per cent. of vessels which service the North sea rigs are many foreign-owned vessels which, although they are registered in Britain and fly a British flag, belong to companies the controlling interests of which are not related to Britain. That is worrying and I hope that the Government will accept that they must encourage as much intervention by British companies in that sector as possible. I am sure that the Offshore Supplies Office does a good job but I should like to encourage it to do even better.

I do not believe that Conservative Members should be prepared to countenance the unfair and subsidised competition that is beginning to go into the North sea. I shall be interested to hear what my hon. Friend has to say about what he proposes to do to put the matter right.

I am not sure whether what the hon. Member for Gordon (Mr. Bruce) said about our attitude to the collection of North sea gas shows that the Liberal party has moved with the times or whether it is sticking to arguments that have long since gone. Any gas-gathering requirement from the North sea can be carried out properly and acceptably by private enterprise. The flag system, the western leg that is about to be developed and the proposed pipelines that are being developed by private industry have resulted in what would have been a red herring being completely avoided. Any public expenditure on a gas-gathering pipeline would have been irrelevant and a waste of taxpayers' money.

Mr. Bruce

Will the hon. Gentleman not acknowledge that the schemes that he is talking about will develop only a fraction of the gas resources that would have been developed with an integrated system? Will he acknowledge that the British Gas Corporation, British Petroleum and Britoil—BNOC at the time—were keen to go ahead with such a system? He is suggesting that their commercial judgment was at fault two years ago, but facts have proved otherwise.

Mr. Malone

I am prepared to concede that a private company will take public money if that money is thrown at it. The enthusiasm for the pipeline did not surprise me. However, although many marginal gasfields might well have been developed, they would never have been economically viable, and we would have had subsidised gas in another form. By insisting on controls on flaring in the North sea and making sure that the systems would be developed by private industry, the Government took the right course. There is now a comprehensive system of gas-gathering in the North sea, none of which has been installed at the taxpayers' expense.

Part of the Government's motion suggests that financial and other services should be extended. With that, in my view, should be coupled a suggestion about free ports in Scotland. I hope that Scotland will be allocated a number of free ports. Some applications have already been made, including one from the Aberdeen area by Barratt. If I talk about the competition for free ports in Scotland, I may run the risk of coming into conflict with the Secretary of State. I believe that Scotland should be allocated at least two free ports, because Scotland has shown that it has the potential to use the asset of a free port. Aberdeen has been allocated a cable channel because that part of Scotland has shown considerable enterprise. I believe that a free port should be allocated to the Aberdeen area for the same reason.

Mr. Maxton

rose——

Mr. Malone

I will give way when I have made this point. Opposition Members have said that free ports are irrelevant, that we do not need them, and that they do not stand up in their own right. I believe that they represent a great innovation in the Scottish economy and that Scotland should take advantage of them.

Mr. Maxton

Like enterprise zones, free ports merely draw jobs from other parts of the country. They do not create any new jobs. That would be the effect of a free port in Aberdeen or in any other part of Scotland.

Mr. Malone

I completely reject that view. Free ports are not in any way analogous to enterprise zones. If free ports were to be used in this country as a simple device to relocate labour and move jobs, I would be against them, but they are a device for bringing new jobs into the country. Jobs would be created not only in the free ports but in the service industries that supply them. I ask the hon. Gentleman to study examples of properly constituted free ports elsewhere in the world.

Mr. Ron Brown (Edinburgh, Leith)

Will the hon. Gentleman give way?

Mr. Malone

No, I have already given way on this point. Where free ports have been properly constituted, they have been a great success. They have been job creators. Every projection and prediction indicates that free ports will handle about 20 to 25 per cent. of the volume of the world economy before the end of the decade. If the hon. Gentleman is suggesting that Scotland can afford to do without such institutions, I find it hard to agree with him.

Free ports create jobs in a number of ways. They relax the regime of customs duties and taxes and excise duties, which might well discourage people from attempting to manufacture in this country. They encourage the assembly of items of which the individual components would be highly taxed if they were imported. They generate a great deal of wealth. The hon. Member for Glasgow, Cathcart (Mr. Maxton) should consider the free port of Miami. From a completely cold start, the free port now employs 10,000 people. It covers 90 or 100 acres. It has brought new jobs to the American economy.

There are certain criteria that the Government should remember when deciding where to locate the free ports. Free ports should not be regarded as a crutch for areas that are not able to sustain industrial growth. I agree with the hon. Member for Cathcart to the extent that I believe that free ports should not be enterprise zones in another form. A free port should be situated in an area of growth, with a well-developed sea port and an up-to-date airport. If the free port is to be a device for encouraging inward investment, it should be placed in an area that is internationally recognised. It will be no surprise to hon. Members to learn that the city of Aberdeen fulfils all those criteria. The Government have been very successful in grasping the nettle of free ports. I shall look forward with interest to further developments.

Regional aid is currently under discussion, and various submissions are being received and considered by the Government. Regional aid has been a blunt instrument used to encourage capital investment. In many respects, it has not encouraged job creation. The loss of regional development area status has sometimes left indigenous manufacturing industry in some areas of Scotland, such as Grampian region, very non-competitive. Certain industries in Grampian find it difficult to compete with similar industries located in other parts of the United Kingdom that receive grant aid. Particularly in Grampian region, that has resulted in the wasteful device of moving jobs around the country at the taxpayers' expense. That must stop. I do not believe that Government intervention in the economy will or should stop, but I hope that when the Government turn their attention to a new device for placing public funds at the disposal of industry, they will do it on a collective basis. I hope that they will judge on the merits of the case rather than the place where the industry happens to be located. When regional policy is replaced, there are several criteria that must be borne in mind.

This debate will deeply divide the House. From the Opposition we hear a tale of woe unleavened by the appearance of any light on the economic scene, while the Government may sometimes be tempted to speak selectively. However, the public can be expected to give credibility to what we say only if we take a realistic look at the signs in the Scottish economy. In the Scottish economy, we are beginning to see the signs of hope. I am appalled by the Opposition's peddling of gloom and not hope, especially as they are substantially responsible for the gloom that they are now able to see.

Manufacturing production rose in 1982. Output per man rose by 7.6 per cent. last year, making us more competitive than we have been for years. The number of strikes fell. I rejoice at all these things because they mean that our economy is once again becoming competitive.

What do the Opposition want from the Scottish economy? Do they want a return to the old days when public money was splurged on industries that eventually went bankrupt? Do they seriously want to see more Linwoods? Do they want to increase steel capacity in Scotland when there is a glut not only on the European market, but on the world market? Are the Opposition seriously suggesting that they want to increase coal production when there are millions of tonnes of unused coal at the pitheads at the moment? They are, as usual, looking to the past.

All that we have heard from the Opposition is the case for what I would describe as the "dinosaur industries." They present a picture of the economy, which is a picture of the past. It is something of a video nasty the title of which is, "When subsidies ruled the earth." That attitude will not be found on this side of the House. Our argument is based upon the future of the Scottish economy, not the past. That is something from which the Scottish people can take heart. There are hopeful signs that we are getting it right but that will not happen as a result of any of the Opposition's policies. The Opposition say that they will get it right, but all they will do is return to the strategy from which we suffered under a Labour Government.

8.10 pm

Mr. Ernie Ross (Dundee, West)

A feature of today's debate is that many Conservative Members did not seem to understand what the Minister said when he opened the debate. Some of them are so far removed from the reality in Scotland that one asks which part of Scotland they represent.

The only good thing that one can take from the speech of the hon. Member for Aberdeen, South (Mr. Malone) is that, unlike his predecessor, Mr. Iain Sproat, he did not try to blame all Scotland's economic woes on the social security scroungers whom his colleague could not identify when he was challenged. A good day's work in Scottish industry might change the hon. Gentleman's attitude and that of the hon. Member for Stirling (Mr. Forsyth) and give them an idea of some of the problems faced by industry.

In the debate, the Government stand accused of having destroyed our trade, ruined our industries and thrown millions of people out of work. They have created an industrial wasteland of despair and depression. Furthermore, they have no policy with which to clear up the mess that they have created. As the depression of 1979–83 has gone on, more and more of the factories, the jobs and resources that could have been used to combat that depression have been destroyed by Government action.

In his autumn statement, the Chancellor seemed surprised that regional grants were not being taken up. That is because there are no factories, industries or employers who believe sufficiently in the Government's strategy to allow them to take up the regional grant.

Unemployed people in Scotland and Great Britain do not want to hear stories of how the depression could have been a great deal worse; they want to hear what the Government, who have the responsibility to govern, will do about it.

I shall concentrate on the city of Dundee. We have 16,000 unemployed people due almost entirely to the Government's economic policies. Of the unemployed men, 40 per cent. have been unemployed for over a year. We have lost over 3 million working days in Dundee, due not to strikes or sickness, but to unemployment. There is no city or country that can afford such grossly inefficient management of the economy and its human resources.

Thousands of millions of pounds have been poured down the drain of unemployment. Money has been cold-bloodedly used to pay the unemployed to keep them unemployed. At the same time, the Government have been helping the rich to become richer. Since 1979 those earning £40,000 a year have become 22 per cent. better off and those earning £80,000 a year are 54 per cent. better off. Government policies which have condemned millions to the wastage of unemployment have enabled the rich to become better off.

The jute industry in my city has lost 5,000 jobs over the past five years. We have identified to the Government the difficulty that the GATT agreements have caused us. We had the charade of Beiulau stealing machinery and experience from Dundee to which the Government refused to respond. The industry has excellent labour relations, low wages and flexibility among its employees and yet it still lost 5,000 jobs. When the Dundee Jute Traders Employers Association—not the trade unions—asked the Government for protection for the special Dundee products it received the simple answer "No."

The Government's ways of trying to help the economy do not succeed. The youth training scheme does not help those who are trying to provide training for young people who will, it is hoped, benefit if the economy picks up. The Dundee engineering training group has made it clear to all hon. Members in the Tayside area that it is experiencing difficulties in continuing to operate the youth training scheme. It opened its factory in 1969 with 55 trainees. That figure has risen to 135. It had a membership of 45 companies. Until August this year, its income came from companies, sponsorship of apprenticeships and the EITB craft award trainees. It says that the youth training scheme could well lead to the closure of Dundee engineering training group. The Government's response to that has been dismal.

In his statement, the Chancellor identified areas in the Civil Service where he saw the need for cuts. He saw a need in particular in the Inland Revenue, and yet we know that the economy could be helped if we could get our hands on the £718 million that the Inland Revenue Staff Association has identified as being the amount of unpaid tax. Surely that is one way in which the economy could be helped.

The Government are determined to continue their attacks on the Civil Service. There have been two examples in Dundee of Civil Service cuts not helping the local economy. In the Customs and Excise the Government seem determined to cut the preventative and rummage staff who are necessary to stop drugs coming into this country. As a result the young people of Dundee and Scotland are suffering because drugs are coming in through the port. Despite the fact that we have identified the problems, when the collector wrote to me recently he said that the flexible use of staff and the reduced level of work could be compared to the number of vessels arriving in Dundee, which he claims has decreased. However, the number of vessels bringing drugs into Dundee has not decreased. There is no chance that the rummage staff who have to cover the whole of the central belt of Scotland will be able to do anything about the drugs coming into Dundee.

The hon. Member for Stirling has left the Chamber. He made what I suppose he would claim were some well-informed and well-intentioned comments. We listened to a young man who demonstrated that theory is all right but that it does not work in practice. I doubt whether he has ever worked in industry. He should take advantage of the scheme which enables hon. Members to obtain some experience of industry. He is a product of a university, but there are other products of the university that are important to the economy—those who leave university and contribute to the economy.

We were reassured once again by the Prime Minister that the universities would suffer no cuts, and yet when we study the strategy for higher education in the 1990s there is a letter from the University Grants Committee to chancellors and principals on 4 November 1983 which says that it will be considering further cuts in the numbers entering university. More importantly, it says that Government funding will have to be considered anew and that the universities should be looking for funding from private sources. Where are these private sources in a stagnating economy?

The report also says that there will be a drop of 20 per cent. in student numbers between 1988 and 1996, and yet there is no apparent provision for growth in numbers for women or mature students, of whom there is an excess on the register. The report says that it wants to shift the finances of the universities to industry and private enterprise. Where will this finance come from, with industry and private enterprise as it now is?

The Government are deliberately trying to minimise the public's awareness of the extent of their economic policy and the effect that it is having on unemployment. During the debate, Conservative Members have attempted to downgrade the contents of the Fraser of Allander Institute report by suggesting that it is inadequate. The Minister knows that it is and he knows why it is because he is the Minister who stopped the unemployment figures being issued by standard industrial clarification. He did that to hide the figures that Fraser of Allander and hon. Members on both sides of the House would have required if they had wished to make a proper input into the debate. When I asked why he had made that decision, the Minister replied in a letter: It was decided that since details of previous occupation are not needed for benefit purposes, it would be a sensible economy to discontinue the collection of this data. What he meant was that there is far more behind this Tory party decision and thinking. He and his Government are saying that all the unemployed are the same, they are faceless people and do not represent the joiners, bricklayers, nurses and waiters in service industry. He is trying to make the unemployed all the same so that it is easier to accept that there are 16,000 unemployed people in Dundee. Rather than identify them and making it clear how his economic policies are affecting the economy of Scotland, he is hiding behind the fact that the data "are not needed for benefit purposes". That is why he could not identify the real unemployment.

The under-employed are also suffering from the Government's economic policies. Those are the people who, because of the pressure on the economy, are having to take jobs that they regard as being below jobs they are qualified to do. That is not to denigrate the jobs that they now have to accept, but many people who have left university as graduates, or have left industry with qualifications, have had to accept jobs outwith the qualifications that they have obtained because of the serious lack of movement in the economy. They are not satisfied and are disgruntled with an economic policy that fails to allow them to achieve their full potential.

The Conservative party may claim that it has cut inflation, but one cannot buy anything if one is unemployed. If one does not have the money one cannot spend it. These people want jobs, not sermons from the Prime Minister, and they want opportunities, not slogans. There is an old saying "You don't win anything by standing for nothing." When it comes to relieving unemployment, the Government stand for nothing. On that basis, they will continue to lose the battle against unemployment. It is time that they did the job that they were elected to do and governed. It is time that they started dealing with the economic collapse that Scotland and the country at large are facing.

Throughout this week people from the aerospace and associated industries have been telling us about the serious problems that face an industry that is not one of the old traditional industries, although it is a traditional industry. We have argued that this industry needs support, and workers from all over Britain, including Scotland, have come to the House to point out that the Government's policies are not helping the industry.

The Minister may have a flash of inspiration and remind us of the recent sale of the HS146. However, the HS146 would not exist had it been left up to the management of Hawker Siddeley. It had no confidence in the plane, but the workers fought for the plane against the management and against the then Secretary of State for Employment, the present Secretary of State for Trade and Industry. The success of that plane owes more to the determination of the work force than to the management of the industry. This week, that industry is making it clear that it needs help, and quickly.

Today, Scottish Members had the opportunity of lunching with the moderator of the Church of Scotland. It is significant that even the church leaders recently identified the real problems that the Government are not tackling. I shall put on record the comments that they made when talking about the serious problems facing one of our old industries. They said that from their experience of the great danger facing working people and their families in Scotland as the result of the crisis in the shipbuilding industry, it was time for the Government to adopt a positive maritime policy. Those words have been used by many hon. Members when talking about shipbuilding. They went on to say that there was a need for an interrelationship of shipping and shipbuilding industries, including defence and offshore capacity. These words will ring in the ears of many hon. Members on both sides of the House. They went on to identify the problems that are a result of the crisis in the industry and spoke about the grievious social consequences of unemployment such as marital breakdown, children taken into care, violence in the home, fuel disconnections, alcoholism, glue sniffing, drugs and the deterioration of physical and mental health. Such references have been missing from the speeches of Conservative Members.

The economy in Scotland and in the country as a whole is in serious decline and it will need more than the comments that we have so far heard to convince the people of Scotland or the country as a whole that Conservative Members appreciate the economic plight in which they are living.

8.27 pm

Mr. Albert McQuarrie (Banff and Buchan)

I speak after the hon. Member for Dundee, West (Mr. Ross), as I did on the occasion of the Second Reading of the Tenants' Rights Etc. (Scotland) Amendment Bill. During that debate, the hon. Gentleman intervened in my speech when I was discussing rents. He shouted "Never", when I said that I was speaking about the city of Dundee in particular. May I make it clear that that was general banter, and that I had no intention of any discourtesy towards the city of Dundee. I hope that the hon. Gentleman will accept that. I am making a genuine apology for something that I said inadvertently, and I hope that the hon. Gentleman will accept it as such.

We have listened today to the usual long-winded oration from the hon. Member for Glasgow, Garscadden (Mr. Dewar). Doom and gloom are his major occupation. Much of what he said is total rubbish and relates only to the city of Glasgow. Nothing is ever said by him or his colleagues about the continued improvement in the economy of Scotland as a whole. We hear only about the area that he represents—a constituency within the area of a local authority that spends money like water and pays little heed to the need to bring the Scottish economy up to the standard that the Scottish people want.

I shall devote my remarks to the Grampian region, which, over the years, has shown that there can be positive growth. I am proud to be one of the Members who represent that region. For the benefit of those hon. Members who have never been north-east of Perth, Grampian is in the north-east corner of Scotland.

Mr. Henderson

I thank my hon. Friend for giving way. I think that he was wise to give advice to those hon. Members who know nothing about the country north of Perth. My hon. Friend will know that the Labour party, which makes such claims about representing Scotland, has only two Members of Parliament representing constituencies north of Perth.

Mr. McQuarrie

I thank my hon. Friend for drawing my attention to that.

For the benefit of hon. Members who have not been north of Perth, except for the Labour party conference, Grampian region is in the north-east corner of Scotland, bounded on the north and east by the North sea, and on the west by the Grampian mountains, from which the region takes its name.

Mr. Maxton

It is not a maiden speech.

Mr. McQuarrie

The region is rich in natural resources. It is a region of fertile farmlands, forestry, fishing, and now oil and gas. I am sure that Labour Members are extremely jealous of the advantages of the Grampian region. The land and sea have dominated our economic structure for generations and will continue to do so.

The region covers 3,400 square miles and has a population of 485,000 people, many of whom live in Aberdeen. The Grampian region, and in particular Aberdeen, has been the focus of one of the most remarkable development successes in the United Kingdom, as a result of the discovery and exploration of offshore gas and oil. More than 2 million barrels of crude oil a day are currently being produced from 21 fields. The oil revenues represent about 12 per cent. of the United Kingdom gross national product.

Mr. Maxton

Subsidy.

Mr. McQuarrie

There is no subsidy. However, despite its strong economy, Grampian, as an industrial development authority, continues to give priority to the non-traditional industries, which are the source and lifeblood of our rural areas and remote communities and our long-term future.

The hon. Member for Gordon (Mr. Bruce) said that rural areas had hardly been mentioned. He may well be wrong. He has not been in the House long enough to know that during the past five years I have spent most of my time complaining about the problems of rural areas. In due course, he will learn that hon. Members who represent rural constituencies do take a direct interest in those problems.

Mr. Martin J. O'Neill (Clackmannan)

rose——

Mr. McQuarrie

In the redistribution of boundaries the hon. Member for Gordon was given a highly satisfactory part of a rural area. I am sure he cannot claim that there is 30 per cent. unemployment in his area. I shall now give way to the hon. Member for Clackmannan (Mr. O'Neill).

Mr. O'Neill

We are always interested to hear hon. Members read Scottish Office briefs, but it is surely not in order for tonight's debate to be used as an opportunity to read the briefs of the Grampian tourist board.

Mr. McQuarrie

This is a speech not for the Grampian tourist board, nor for the Scottish Office, but by a Conservative Member of Parliament democratically elected to represent a constituency. The hon. Member for Clackmannan is being impertinent when one recalls that the speeches he makes from the Dispatch Box are chapter and verse prepared for him by a Labour party research assistant, not one word having come out of his own head.

Having spoken about the traditional industries, I wish to refer to fishing and farming—indigenous industries. Those industries have suffered mainly from the loss of assisted area status. That is a great blow to the area that I represent. I want to establish clearly that when the White Paper on regional policy is published it should outline a selective regional policy for companies requiring aid. It is fair to say that Grampian is the one region that has had a growth rate. The growth rate in employment was the figure I quoted to my hon. Friend the Member for Aberdeen, South (Mr. Malone). In 1974 the figure for oil-related industry was 34,000; by 1983 it was 63,800. By the end of the 1980s, that figure will go up to 100,000. Therefore, before the end of the 1980s we can look forward to a further 30,000 jobs.

In looking at the Grampian area, the problem of selective aid for the indigenous industries—fishing, farming and small engineering—must be taken into account. Many jobs exist and a great number of jobs will be created. Crosse and Blackwell recently announced an increase of 160 employees in Fergus in the coming year. The gas pipelines and improvements in gas production will create a further several hundred jobs in the area.

In Fraserburgh a scheme has been started in conjunction with the SDA—I draw the attention of the hon. Member for Gordon to this—to improve the employment situation. Unfortunately, oil passed Fraserburgh by. There was a drop in fishing because of the failure to finalise a common fisheries policy. That was because of the inability of other member nations to agree quotas. A common fisheries policy would have been of great benefit to the fishing industry, and it was accepted as such by the industry. There was no dispute about that. General agreement on a common fisheries policy would ensure the living standards of the fishing industry far into the future.

Similar considerations apply to farming. There have been reductions in the programmes for pig and beef production, yet the region has not accepted that the recession would drag it down.

The great advantage of having a conserved, controlled region is that it would take under its wing the opportunities that must be given to create employment. The region has created jobs out of ratepayers' money at British Fish Canners and other places in the constituency. At General Motors, 1,500 jobs were lost due to the withdrawal to Indianapolis. In CPT in Fraserburgh 1,770 jobs were cut to 750 jobs. Scotland's economy is improving. The opportunities exist and people are taking advantage of them. I agree that that is the area where all the gas and oil comes ashore, so many jobs are being created there.

The hon. Member for Gordon should not say that no jobs are being created in his constituency. The number of people employed on the construction of houses in his constituency and the number of people who have bought houses there belie the story of doom and gloom that he tried to sell the House tonight. That is an important part of the Scottish economy because it is contributing to the revenue, which helps to ensure that the Scottish economy can advance.

My hon. Friend the Member for Aberdeen, South (Mr. Malone) quoted figures that show a general upturn in the economy. I agree with him. The Government are on the road to recovery. They are bringing the economy back to profit.

Many hon. Members have talked about steel, and some of us visited the steelworks to see what was happening. The construction industry has been in recession, but it is now coming out of it. More houses are now being built in the private sector than were built last year. Those are signs that the economy is coming out of the recession. During the next year the Government will show positively that their policies—especially those that they have implemented for Scotland—will be of great benefit.

Mr. Maxton

Will the hon. Gentleman tell the House how many houses were built or started this year compared with 1979, which is a much more significant year than 1982?

Mr. McQuarrie

I do not have those figures with me. I am sure that the hon. Gentleman knew perfectly well when he asked the question that I would not have them. If he knows, he can tell me.

Mr. Ron Brown

Is the hon. Gentleman aware that a record number of companies are going bust each week, thanks to his Government's policies? Where is the economic miracle? I am sure that it does not exist in Grampian.

Mr. McQuarrie

I do not suggest that there is an economic miracle. One must build a house from a solid foundation. In 1979, the Government inherited a bankrupt nation from the Labour Government—[Interruption.] The hon. Member for Dundee, East (Mr. Wilson) may not have thought it bankrupt, but sadly he has been away ill for some time. However, now that he is back in his place, I see that he has not lost his fervour for a Parliament in Scotland. He is wasting the time of the House.

In 1979 the Government inherited a bankrupt country. In our manifestos of 1979 and 1983 we told Britain what we would do to bring it back to prosperity. That undertaking was endorsed in 1979, and again massively in 1983. If the Government continue to implement the policies in their manifestos, by the end of the 1980s Britain will be healthier than it is now.

Several Hon. Members

rose——

Mr. Deputy Speaker (Mr. Ernest Armstrong)

Order. The Front Bench spokesmen hope to catch my eye at 9.20 pm, in another 35 minutes. The number of hon. Members that I am able to call will depend on the length of speeches of those hon. Members who are fortunate enough to catch my eye in the meantime.

8.45 pm

Mr. Michael J. Martin (Glasgow, Springburn)

Two years ago the Secretary of State took part in a debate on British Aluminium in which he argued that the Government could do nothing for British Aluminium because of the aluminium glut in the United Kingdom and throughout the world.

The hon. Member for Gordon (Mr. Bruce) was right when he said that the price of aluminium has increased drastically, but it has done so because of the redundancies that have taken place in the aluminium industry. We are in a good position because at least we have the opportunity of reopening the Invergordon smelter. It would have been a tragedy had that smelter been razed to the ground. Many manufacturers in Britain cannot get supplies of aluminium at the moment. That is a sad state of affairs, because only two years ago we were telling the men of Invergordon that there was no work for them and that they would have to leave.

I am sorry to say that the story of Invergordon and the story of the aluminium industry applies to every industry in Scotland. It applies to coal—Cardowan pit has been closed. The hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley) mentioned Cardowan and referred to how much money it would take to subsidise the pit, but she did not mention the fact that we are pumping millions of pounds into the Falklands of which no one had even heard a few years ago. We do not hear a cheep from the Conservative Benches about how much money is going there.

Mr. Dalyell

It is £6 billion.

Mr. Martin

Coal is important, and if we are thinking of future generations we should be exploiting that asset and we should be thinking of ways of keeping Cardowan open.

The same story applies to railways, engineering and steel. It is an absolute scandal that our industries are being run down to a bare minimum. We will lose what little industrial base we have.

My right hon. Friend the Member for Glasgow, Govan (Mr. Millan) mentioned Rolls-Royce in Hillington. I left Rolls-Royce in Hillington in 1976 to become a full-time union officer for NUPE. When I left the factory, 6,000 workers, men and women, were employed of whom 90 per cent. were highly skilled. That figure is now down to 3,000. Those 3,000 jobs were lost from the aero-engines division of Hillington quietly because it was done through natural wastage. Those are not just numbers to me— those are friends, families, people with whom I have worked, people I know and people who have put a great deal of devotion and skill into the industry. Something must be done. When the aerospace lobby was here only last night it expressed the worry that if the design teams from aerospace were lost we shall be in great trouble in defence and in civil aviation.

Like other hon. Members, I take a great interest in industry. I am chairman of the Labour party subcommittee on industry in Scotland. I take the trouble to go to factories to see what is happening in industry. When we ask employers whether their businesses are successful, we are told that success means that they are actually surviving. They say that if they are surviving they are successful. They do not talk about a full order book now—being successful means having three weeks work on the shop floor. If they get three months' work they turn somersaults.

There are many small engineering companies which have depended upon larger companies such as Howdens, Rolls-Royce, Scott Lithgow, and Anderson Strathclyde. The smaller companies depended on subcontracts from large companies, but the larger companies are now drying up their work and even competing with small contractors. They are submitting unrealistic quotes to keep their work forces ticking over. It is commendable that they are keeping their work forces occupied, but small companies which depended on them and their work are going out of business.

The Secretary of State and his Ministers tell us that everything in the garden is rosy. They can point to companies that are doing reasonably well but I hope that they will not forget that the companies which are surviving are doing so on the work which was done by companies which went bankrupt. Many companies go out of business and the company that survives is not creating and obtaining new work. It is surviving on the misfortunes of companies which have gone bankrupt.

The Government hold the key. They must initiate large capital projects which will give work to larger companies and which in turn can give work to subcontractors.

I have heard a great deal about new technology. The Secretary of State is trying to kid us on by saying that new technology will replace the old industries. I wish new electronics industries well and I am glad that they are coming to Scotland, but I hear a good deal of nonsense about new technology. There is much talk about floppy discs, software, hardware and home computers. Even hon. Members have acquired pieces of this new equipment. Let anyone name it and they are talking about it, megabytes included. However, the new industries cannot survive unless we have healthy traditional industries in the manufacturing sector. A builder does not need a computer to calculate his payroll or ledgering work if he has only two weeks' work for his men. If he is in that position, he can carry the figures in his head.

The new industries are excellent and I wish them well. I know that we have the expertise to cope with them. At the same time we should not kid ourselves, for they do not replace old industries. The old industries and the new industries should be complementary to one another if we are to have an expanding industry.

We must encourage British companies to make more bids for North sea work. There is high technology work in the North sea and many of our traditional companies are frightened off. They do not take that work on board or even tender for it. The larger companies with North sea contracts are going abroad for their contractors. Some British companies which have North sea contracts are giving subcontracts to Norwegian companies. It is a scandal that British companies should be overlooking British subcontractors. It saddens me to think that in the Norwegian sector every supply ship is Norwegian. Only 50 per cent. of the ships that supply our offshore companies are British. The other 50 per cent. are Norwegian or of other nationalities.

If Norwegian North sea and offshore industries are protected, we should take a leaf out of their books. It might not be cricket to do that, but we are not playing cricket when faced with the serious problem of unemployment. The Norwegian ships are doing well in supplying the offshore industries because of the Norwegian tax system and subsidies to the shipbuilding and other industries.

There is serious concern about Korean, Japanese, French and German steel coming into this country. It is all very well for the Secretary of State to tell us that he supports Ravenscraig and that he is not happy about the deal between the Americans and the British Steel Corporation, but he must do something to stop the dumping of foreign steel. If he wants to support the steel industry, he must make his voice heard in the Cabinet.

Many British manufacturers when making a substantial order for steel from British stockholders often believe that they are buying British steel. It is disturbing that, when the supply is delivered to their factories, they discover on examining the Lloyd's certificate that the stockholder has sent them foreign steel. Many stockholding companies which claim to be British and to be supporting British industry are buying foreign steel and selling it in that manner. This should be examined. If British stockholders are buying foreign steel, they should advertise that they are stocking not British steel but dumped goods. The hon. Member for Grantham (Mr. Hogg) laughs. There is no point in the Secretary of State for Scotland telling us that he supports Ravenscraig if he does nothing to protect us from the dumping of foreign steel.

The Scottish retail industry has done an excellent job in employing labour. Gone are the days in the retail industry when young boys and girls worked for a time and their only experience was work behind a counter. It is of great credit to the retail industry that it now gives a good training to many young men and women.

We have the best service in the world because we can take goods from every part of the world and from this country and distribute them throughout the country. We face a problem because, although we need many foreign products and foods which cannot be grown here and it is good that we have that service, our foreign competitors can use our retail industry to their advantage because of our centralised system whereas people in Britain who try to export goods to France, Germany and other foreign markets find that the retail system in those countries is not good, and, therefore, they are disadvantaged.

The building industry and developments in the private sector have been mentioned. I am sure that building workers are grateful for the work provided by private employers building houses throughout Scotland. Nevertheless, although we have debated this before, I ask the Secretary of State again to reconsider the Government's decision to reduce the 90 per cent. improvement and repair grants because that decision will do great damage to the building industry, especially to those companies in Scotland which have developed expertise in rehabilitation. Companies specialising in new-build cannot do that work and there is a danger of losing the companies that have gathered so much expertise in rehabilitation in such a short period. Those companies do very good work and their loss would mean further unemployment in areas such as mine.

Finally, if we are concerned about the Scottish economy and its future, we must look at the traditional industries as well as the new industries.

9.1 pm

Mr. Barry Henderson (Fife, North-East)

The hon. Member for Glasgow, Springburn (Mr. Martina is an awfully decent fellow. He had a good girn about the Scottish economy, but, like so many Labour Members, he failed to analyse the cause of the problems and what it is proper for Governments to do about them.

I hope that the whole House will accept that unemployment has not come to us suddenly or recently. There has been a rising tide of unemployment both in this country and in Scotland for more than a decade, probably two decades. It is worth remembering that, although the Labour Government did not want unemployment, it doubled during their period of office. Many of the problems with which we are now coping arose from their erroneous solutions to the unemployment problems at that time.

Perhaps the most dramatic change—this is why I believe that my right hon. Friend the Secretary of State was entirely right to look forward with confidence to the future of the Scottish economy—is that many of the root problems that faced the Government when they took office are no longer with us. The rising tide of unemployment is still with us, due to previous errors, but it has been slowing. It is perhaps too early to say that we have now hit slack water, but as the Government's measures have increasingly taken effect the rate has certainly slowed. The conditions now emerging hold out real prospects that the tide that has risen for so many years may finally turn, perhaps permanently.

It is curious that so many areas of Scotland in which unemployment is worst are areas where Socialism is strongest. I do not know whether that is a direct chicken and egg effect, but areas in which local authorities have been under continuous Socialist control for many years and for which there is strong Socialist representation in Parliament often have severe unemployment problems. In many areas the attitudes to Socialism are counterproductive to the prospects of economic advance. I believe that the idea that one can have everything guaranteed for life regardless of what one does or contributes is bound in the long run to bring about the economic circumstances that resulted in the International Monetary Fund being brought in to bale out a bankrupt Labour Government. The Lib-Lab pact saw a massive increase in unemployment and a massive pumping out of public expenditure which failed to cure the problems.

Opposition Members laughed when my hon. Friends referred to some of the success stories in the Scottish service and tourism industries, particularly when my hon. Friend the Member for Strathkelvin and Bearsden (Mr. Hirst) referred to the importance of financial services. One hon. Member shouted out "How many jobs has that brought?" The answer is that 2,000 jobs per annum have been brought to Scotland in financial services in recent years. They are important jobs. My hon. Friend the Member for Renfrewshire, West and Inverclyde (Mrs. McCurley)——

Mr. McKelvey

I am trying to follow the hon. Gentleman's analysis in which he ascribes the problem of unemployment in Scotland to Socialist district and regional councils. The Scottish electorate voted 2:1 in favour of Socialism in the general election, irrespective of district or council elections. Yet the hon. Gentleman referred to success in tourism and service industries in Scotland. If he is to blame Socialism for unemployment, he must be consistent.

Mr. Henderson

I am happy to be consistent. The problem with Socialist local authorities is that they spend money to buy votes and ruin industry.

The hon. Member for Dundee, West (Mr. Ross) said that in his Socialist-controlled local authority area rates have increased by more than 150 per cent. in four years. At my end of the Tay bridge—our constituencies are separated only by the width of the river Tay—district council rates have increased by 2p or 3p in the same period. It is against that background that local authorities can help or hinder industry.

When we examine the extent to which Socialists are representative of Scotland, we realise that the Labour party lost tens of thousands of votes in Scotland at the last election. Moreover, one in six of the Labour candidates in Scotland lost their deposits. The Labour candidate in my constituency lost his deposit by getting only 5 per cent. of the votes cast. Therefore, perhaps we shall hear less about the Labour mandate. Labour has caused serious harm to Scottish interests. It has been a disgrace that Labour Members, with party political interests, have continued to run down much of what is fine in Scotland and much of which we can be proud in the Scottish economy. I do not suggest that all is perfect. The Government have addressed themselves to the real problems of Scotland. They have created a firmer foundation for its future. Many aspects of the Scottish economy give great encouragement to the future. I wish that Labour Members would say more about that.

I agree that there is a continuing future role for traditional Scottish industries, many of which use the most advanced techniques. That is no reason for Opposition Members to denigrate the importance of high technology in general and electronics in particular, and the services that go with them.

Some Opposition Members want to keep open uneconomic pits with wholly unsatisfactory employment conditions for men who would be better employed elsewhere—[Interruption.] To do so, they are prepared to charge—[Interruption.] Have you noticed, Mr. Deputy Speaker, that when Conservative Members speak there is a constant barrage of noise from the Opposition, but when Opposition Members speak they are listened to with courtesy? Opposition Members do not like to hear the facts about the Scottish economy.

Opposition Members are arguing for increased electricity prices to keep open uneconomic pits with unsatisfactory job facilities. It is unfortunate that they have chosen to run down Scotland and the prospects for the Scottish economy. We are entitled to feel confident about the future because prices are steadier than at any time in the past 15 years, inflation is falling, interest rates are lower than in the United States—which has not happened for many a long year—investment is growing, exports are rising, demand is expanding, output is increasing and profitability is strengthening.

Those are the reasons why I urge the House to support the Government motion.

9.11 pm

Mr. John Maxton (Glasgow, Cathcart)

We have heard some remarkable speeches from Conservative Members. They have ranged from the pre-Adam Smith economics of the hon. Member for Stirling (Mr. Forsyth)—to describe his views as Adam Smith economics would be to insult Adam Smith, he was so simplistic in the way that he presented them—to expressions of great hope from the hon. Member for Fife, North-East (Mr. Henderson).

We all want to see an improvement in the Scottish economy; that must be the aim of every hon. Member, of any party, who represents a Scottish seat. Opposition Members want to see that improvement much more than Conservative Members because more of our constituents suffer from the economic blight in Scotland brought about by Government policies.

Of course there has been a slowdown in the decline in the Scottish economy. If the number of unemployed had not decreased but had continued at the rate of the past four years, by the end of the Government's reign almost everyone in Scotland would have been unemployed.

The leader in the Glasgow Herald today said that Devolution is indirectly involved in so far as the Government's decision to grant a debate has been read as a ploy to defuse the controversy over the proposed composition of the Select Committee for Scottish Affairs.

Mr. Allan Stewart

Oh, really.

Mr. Maxton

I admit that I read that article with some incredulity. I find it difficult to believe that a minor Opposition amendment forced the Government to grant the debate. I am sure that that is not possible, and I am not sure that the Glasgow Herald thinks it possible, either. However, the debate has a great deal to do with devolution.

The Opposition's aim is to have a Select Committee that will do the job properly. To do that, it needs more active Labour Members and fewer semi-retired Conservative Members. We must have a Select Committee, and when we debate its composition I hope that I shall catch Mr. Speaker's eye so that I can develop my argument in detail.

If this debate did not have anything to do with devolution it would not have been opened by the Secretary of State for Scotland—it would have been opened by the Chancellor of the Exchequer. It may be that among the list of names attached to the motion, no one other than the right hon. Gentleman would open the debate. Perhaps the Prime Minister, the Foreign Secretary, the Home Secretary, the Chancellor of the Exchequer and the Secretary of State for Education and Science all refused to open the debate, so that at the end of the day the Secretary of State for Scotland had to open it.

Devolution, and the assembly that Scotland should have, have a great deal to do with the Scottish economy. Of course, no one is claiming that a Scottish assembly could solve all the economic problems of Scotland, which is subject to British, European and world economic conditions, as is every other part of the United Kingdom. However, there are issues which affect the Scottish economy that would have been, and still should be dealt with by the Scottish assembly. One has been mentioned—building and construction, especially under local government. No other activity in the economy can more quickly stimulate growth than house building, construction and civil engineering. Many civil engineers maintain that unless there is major investment in our sewers and waterworks there is likely to be a major health hazard. Conservative Members might laugh but those people support the Tory party, not Labour. Indeed, many of them give money to the Conservative party. They might not continue to do that. Building and construction depends on public expenditure from local authorities and the Government. Such expenditure would have been covered by the Scottish assembly.

We hear a great deal from Conservative Members about tourism. They say that tourism is a great growth industry which will provide many new jobs. That is marvellous. However, I wonder whether the hon. Member for Stirling believes that we should subsidise ferries to our holiday resort islands and the roads, railways and airlines that serve the Highlands. I wonder whether he believes that we should ensure that local authorities can provide proper leisure facilities.

The biggest tourist attraction in Glasgow is the Burrell collection. It nearly did not open because the Secretary of State for Scotland cut into Glasgow district council's expenditure so much that it had to face the possibility of abandoning it. The collection is, however, a remarkable success story in terms of tourism.

Mr. Younger

rose——

Mr. Maxton

I shall not give way as I have only four minutes left. I have sat through the whole debate and am not prepared to give way. The Burrell collection, the Scottish National Opera and the Scottish National Orchestra depend on public subsidy to survive. They are major tourist attractions yet the Government are reducing the funds provided to them.

When somebody arrives in the area with a young family they might be attracted by Scotland's beautiful scenery but they also want leisure activities such as playing fields and swing parks for their children. They want a variety of facilities. Such facilities are provided by the local authorities, which the Government have hammered.

Education is another important subject. The Secretary of State has the brass neck to talk about a skilled work force in Scotland and yet yesterday's Evening Times says that Strathclyde university will have to turn away thousands of well-qualified applicants. Indeed, those people are better qualified than many of their predecessors. Where will those people get the skill training of which the Secretary of State speaks?

The Government have cut expenditure on education, housing and leisure. Their record on public expenditure is appalling. It is time that they learnt the simple lesson that it is not possible to sustain private enterprise in a modern economy without massive public expenditure. Someone said that it is possible to get new jobs by spending money. I agree. It does not matter whether that money is provided by the private or the public purse, new jobs can be achieved only by spending money. I prefer it to come from the public purse, so that we can control investment.

All the matters that I have mentioned should he under the control of a Scottish assembly. They should be the job of the Scottish assembly. If we had the assembly, for which the Scottish people voted, then, although we would still have the economic problems created by the Conservative Government, there would be a body elected by the Scottish people to protect them from the worst onslaughts of the Government in public expenditure.

9.21 pm

Mr. Jim Craigen (Glasgow, Maryhill)

This has been a lively debate, if nothing else, but the Government have not really answered any of the points raised in their own motion.

I was glad that the hon. Member for Banff and Buchan (Mr. McQuarrie) made a speech. They do not make Tories like him in Scotland any more. I remind him that he and his party supported the removal of assisted status from the Aberdeen area. I hope that the Under-Secretary of State who is to reply to the debate will assure us that he is doing his utmost to preserve Scotland's position in relation to regional aid. We want to know the score for Scotland in the current discussions on United Kingdom policy. Will the Under-Secretary confirm that there is no map in the White Paper to be published? That would contradict the arrangements by which the EC identifies areas in need of assistance. I am worried about the fact that the Secretary of State for Trade and Industry was recently quoted in the press as suggesting that, if only people in the "regions" which receive assistance would accept lower wages, it might be easier to operate a regional policy. We do not accept that view in any way.

The Secretary of State and the hon. Member for Strathkelvin and Bearsden (Mr. Hirst) referred to the west of Scotland science park. I am glad that the park is in the constituency of Maryhill. I was keen that the park should be situated both in Glasgow and, of course, in Maryhill. It represents a unique partnership between Glasgow university and Strathclyde university backed up substantially by the Scottish Development Agency. I made efforts at the time to ensure that Glasgow district council planning department and other departments in the city gave it the fullest support possible. I was, however, never under any illusion that it would provide a vast number of jobs. What is important is the potential and the spin-off.

We welcome high technology industries. We want to see those new industries developed. However, as my right hon. Friend the Member for Glasgow, Govan (Mr. Millan) pointed out, as well as trying to attract the new industries we have to pay attention to the existing industries, many of which are crucial to the Scottish economy.

Like my hon. Friend the Member for Glasgow, Springburn (Mr. Martin), who last night chaired a meeting with a Rolls-Royce delegation from Hillington and East Kilbride, my right hon. Friend referred to the importance of Government support for Rolls-Royce. I hope that the Minister will also take up my right hon. Friend's point about the shipbuilding order for the Clyde. My hon. Friend the Member for Midlothian (Mr. Eadie) pointed out, with passion, the importance of the coal industry to the future of Scotland.

When the hon. Member for Dumfries (Sir H. Mona)) referred to the importance of the service and retail industries in Scotland, my mind wandered to the number of shopping days to Christmas. We should remember what has happened to purchasing power in Scotland and to the amount of money available in many Scottish households from Banff to Stranraer.

The points that were made by the hon. Member for Dundee, East (Mr. Wilson) and my hon. Friends the Members for Dundee, West (Mr. Ross) and for Glasgow, Central (Mr. McTaggart) about the impact of the changes being made in the Government's housing benefit legislation cannot be ignored. If ever there were a vindictive assault on the income of many Scottish households, it is the changes being made in respect of young people, where benefits will be cut because those young people stay at home and do not happen to have a job. That seems strange so soon after a Budget in which the Government gave substantial mortgage income tax relief to those in the higher income bracket.

Mr. McQuarrie

And to the council tenants.

Mr. Craigen

Do not let us start on the Tenants' Rights, Etc. (Scotland) Amendment Bill. Let us deal with the point that has been made constantly by the CBI, which extolls the virtue of capital projects to the exclusion of their revenue implications. I attended the CBI conference in Glasgow which the Lord Provost Dr. Michael Kelly and the district council had done so much to draw to the city. Many of the wives at that conference were going to the Burrell collection to see the treasures of the late Sir William Burrell at the magnificent Pollok estate. If we listened to the message that comes across constantly from the CBI and other bodies, the Burrell collection would not have been opened to the public because there would have been no staff, nor any will by the district council, to open it.

We should accept that capital and revenue expenditure are, in many ways, inseparable Siamese twins. There is no point in building sheltered housing if the local authority cannot afford to appoint a warden. Many other examples of such nonsense arise when the argument is advanced that capital projects are good but revenue projects are bad. That makes a nonsense of building anything.

I want to talk about the problems of inner cities. I assure the hon. Member for Banff and Buchan that I have visited many small places in his area. I believe in moving around the country, but the problems that face cities are the ones to which the Government must address themselves seriously.

The effect of the change in the housing improvement grant system disturbs me greatly, because the bulldozer will become a familiar sight on our urban landscape once again. We will not be able to preserve many of the tenements and other properties which house improvement and repair grants have done so much to refurbish.

Will the Minister assure us that the Housing Corporation will not cut back substantially, as many of my housing associations fear, in the decision which will be announced, I believe, next month? The Government are going back on their June manifesto commitment over the support which was promised for the renewal of our inner cities and to the work of our housing associations. Local authority new building has almost shuddered to a halt. We look to our housing associations to provide the refurbishment and renovation of our inner city areas.

I received a memorandum yesterday from the Scottish Federation of Building Trade Employers—hardly an organisation that is affiliated to the Labour party—pointing out the tremendous drop there has been in the numbers employed in the building industry in Scotland since 1979. It is a drop of 23 per cent. in an industry which has traditionally provided a large number of apprenticeship opportunities for the young people of Scotland. This is something at which the Minister should look closely because many of the firms in the federation are working at 70 per cent. capacity.

When it came to youth unemployment, the Minister trotted out the usual story about the youth training scheme. I recently visited, as I regularly do, a supplementary benefit office, a jobcentre and an unemployment office in my constituency. It is important that Members of Parliament call in on these offices. If some of the Tory Back Benchers paid such visits now and again, that would knock some of the smart Alec stuff that we have had this afternoon out of their heads. I find it repugnant that young people are having to sit around these offices because there is insufficient work in Scotland, especially when one looks round and sees all the things that could easily be done in Scotland if there were the political will to do it.

When I was visiting one of these offices, someone commented to me that in a recent application for a clerical post there was a young man who had been out of work for nine months who had six higher and four ordinary grade certificates in the Scottish certificate of education. The Minister can wax eloquently about the education opportunities afforded, but we know that many of our universities could take in more students if the Government gave them the necessary backing. I hope that the Minister will respond to the points made by Strathclyde university on this because it is over-subscribed, as are many other universities.

My hon. Friend the Member for Dundee, West referred to the lost capacity through unemployment. We never hear about the £15 billion, £16 billion, or £17 billion lost to the Treasury or that that has to be given out as unemployment benefit and to meet other social obligations that the Government have to pick up. The Government would be better doing their accounting in a more positive fashion.

Long-term unemployment is the most serious aspect of unemployment, and is a fast-rising segment of unemployment in Scotland. I can see the Minister indicating dissent, so I shall ask him what he was doing when the Manpower Services Commission told the area boards in Glasgow and elsewhere that there was no more money for the community programme. This is the only little tool that the Government have produced to deal with the problem of the long-term unemployed in the past two years. Both Glasgow district and Strathclyde region councils and the voluntary organisations are caught up in potential legal disputes because they have already recruited people into the programme and the Government have suddenly announced, yet again, that there will be a freeze on future resources for this programme.

The Secretary of State for Scotland referred to the number of places that jobcentres have been filling, but I wonder whether he has been looking closely at the trend in part-time work. The jobcentre that I visited recently said that a third of the places that it had filled were for part-time jobs. That is welcome for those that obtain part-time employment, but although it reduces unemployment figures, it also means that part-time earnings come into households rather than full-time earnings.

Despite the fact that this kingdom has had the advantages of North sea oil, and the Government have had the benefit of its developing riches and potential, the Government have found it necessary to slap on a tax on gas and electricity, thus affecting heating, lighting and cooking costs, and industrial costs. Many of the firms that I visit complain not so much about rates as about energy costs. The Government should not underestimate the extent to which this development of policy will injure many of the firms which have supported the Government through the CBI.

Let us not throw away our basic traditional industries. Let us use them, and develop the new industries. The bubble will burst at some future date—the year does not matter. We should be preparing now for the day when we shall no longer be able to afford the way North sea oil has masked the serious deterioration in our manufacturing capacity and performance. We can have all the desk calculators and computers that we like, but if we run out of coal in the fireplace, and if we run down the textile industry, the importance of which my hon. Friend the Member for Paisley, North (Mr. Adams) stressed earlier, and the steel industry, the country will indeed be in a serious situation.

The Government motion burbles on about a Scotland that we do not recognise. It has been written by people who do not know, far less comprehend, what is happening in Scotland at present. It is a derisory motion. It has been drafted by Ministers whose actions—more often inactions—at the Scottish Office are denying elderly people in Scotland the care and comfort that they deserve, and who are frustrating the fulfilment of people in their middle years and, above all, are cruelly blighting the future prospects of young people in Scotland.

The Secretary of State and his Minister are more like carrier pigeons carrying messages from No. 10 to Edinburgh, and pretty ineffectively at that. If ever there were a couple of "Haddies", they are the Under-Secretary and the Secretary of State.

We reject entirely the claim that the Government make in their motion. It is a fraudulent claim. We condemn the Ministers who have put pen to paper and who believe that this is the Scotland of today. Those Ministers are responsible for the present state of disrepair in which our country finds itself. Their incompetence and callous indifference reveal that every day of the week. The sooner we get rid of them, the better for Scotland.

9.38 pm

The Under-Secretary of State for Scotland (Mr. Allan Stewart)

I congratulate the hon. Member for Glasgow, Maryhill (Mr. Craigen) on his elevation to the Front Bench and on his first speech from the Dispatch Box. He will not expect me to agree with everything that he said. I have never been described as both fish and fowl within a period of about 10 seconds, but I am sure that all hon. Members will agree with me when I say that the hon. Member brings to his position considerable expertise and experience, and that his views will be listened to with respect by all hon. Members.

The Government consider it important at this stage early in the new Parliament to give the House the opportunity to consider the Scottish economy. There have inevitably been areas of disagreement between hon. Members but a number of constructive comments as well.

It was astonishing that the hon. Member for Glasgow, Garscadden (Mr. Dewar), who spent most of the last Parliament complaining about the lack of opportunities, as he saw it, to discuss Scottish business, did not even deign to welcome the fact that the Government have allocated a day of Government time to consider the Scottish economy. At least the hon. Member for Dundee, East (Mr. Wilson) welcomed the debate. The reason the hon. Member for Garscadden did not welcome it was well put by my hon. Friend the Member for Dumfries (Sir H. Monro), and the hon. Member for Dundee, East who both said that the hon. Member for Garscadden had nothing of substance to say.

The hon. Member for Garscadden is described in the press as something of a pessimist, particularly, the press say, about the future of the Labour party, which is perfectly understandable. I am bound to say that the hon. Member was completely negative in his speech. At least the hon. Member for Maryhill praised the science park. It was astonishing that the hon. Member for Garscadden did not even mention the Clydebank enterprise zone on the boundaries of his constituency. The words of the hon. Member for Garscadden who attacked the enterprise zone will be listened to with great interest by the Labour council of Clydebank, which has supported the enterprise zone.

Hon. Members have made a number of specific constituency points in the debate. The hon. Member for Motherwell, North (Mr. Hamilton) mentioned the situation at Terex and I know that he has had talks with the receiver about that. I assure him that my officials in the industry department are in touch with the receiver but, as he will appreciate, the responsibility is with the receiver.

The hon. Member for Paisley, North (Mr. Adams) made a specific claim that British Rail was currently seeking 200 redundancies. I assure the hon. Member that he is misinformed. I believe he had not checked that claim with British Rail.

The hon. Member for Midlothian (Mr. Eadie) spoke with his customary expertise and conviction and, indeed, passion on the coal industry. My hon. Friend the Member for Renfrew, West and Inverclyde (Mrs. McCurley) and my hon. Friend the Member for Fife, North-East (Mr. Henderson) correctly put the question of the coal industry into its economic context. My hon. Friends pointed out that uneconomic pits also closed under the Labour Government.

My hon. Friend the Member for Aberdeen, South (Mr. Malone) in an extremely well-informed speech put forward the case for a free port in Aberdeen. I can tell my hon. Friend that I hope decisions on a free port will be reached by the Government early in the new year.

Mr. Dewar

rose——

Mr. Stewart

The hon. Member for Garscadden did not give way during his speech. I must try to answer as many points raised by hon. Members as possible in a long debate. The House knows that the Front Benches agreed to have only 20 minutes each to wind up the debate.

My hon. Friend the Member for Banff and Buchan (Mr. McQuarrie) gave an excellent description of the industries and the achievements of the Grampian region.

The hon. Member for Glasgow, Cathcart (Mr. Maxton) seems to have a constituency interest in the arts; perhaps he is looking for a Front Bench post as shadow Scottish spokesman for the arts. I should tell him that the Scottish Office paid for half of the cost of setting up the Burrell collection, and that next year the Scottish National Opera will receive a grant of about £2.5 million from the taxpayer.

The general theme of this debate has been change, and to reject change is to reject the possibility of progress.

Mr. Dalyell

rose——

Mr. Stewart

I apologise to the hon. Gentleman, but I shall not give way. [HON. MEMBERS: "Give way."] The hon. Member for Garscadden did not give way once during his speech.

Several hon. Members who spoke today implicitly rejected change. They mentioned the decline in some sectors of industry and gave instances of firms in difficulties, and suggested that those alone prove the generally poor state of the Scottish economy. However, the House should consider the full picture. The process of industrial revolution means the growth of some sectors and the decline of others. [HON. MEMBERS: "Which sectors?"] That is a normal and natural part of industrial progress. The proper response is adaptability and a readiness to change with the times, as my hon. Friend the Member for Stirling (Mr. Forsyth) said. Scotland has already shown that, in large measure, it is equipped to make that response.

Opposition Members asked me to list the areas of growth. As many of my hon. Friends said, North sea oil and gas extraction and related activities have provided, from almost nothing, more than 100,000 jobs in Scotland. I am glad to say that employment in that area shows signs of increasing further. The Manpower Services Commission estimated in June this year that employment in firms wholly involved in North sea oil activities was 8.5 per cent. higher than it was in June 1982.

My hon. Friend the Member for Aberdeen, South mentioned the success of Government measures in encouraging production, and he also mentioned the longterm future of the oil industry. The hon. Member for Glasgow, Springburn (Mr. Martin) mentioned the importance, with which I agree, of Scottish firms supplying that industry, and he discussed the role of the Offshore Supplies Office. On the most recent figures available, during a four-year period 67 per cent. to 79 per cent. of products for North sea industries were supplied by United Kingdom companies.

Another major area of expansion has been the service industries. However, we heard nothing from the Opposition about service industries during this debate, despite the fact that they employ 64.6 per cent. of the Scottish work force, and despite the fact that employment in those industries has increased by more than 180,000 since 1970, and increased by 11,000 between 1979 and 1981 alone. The most significant increase was in the professional and scientific services, but as my hon. Friend the Member for Strathkelvin and Bearsden mentioned the importance of the service industries, and said that they make Edinburgh an international port of call for big business that is as important as Zurich or Frankfurt—[Interruption.] I do not know why Opposition Members scoff at the achievement of the financial sector in Scotland. My hon. Friends the Members for Renfrew, West and Inverclyde and for Dumfries mentioned the importance of tourism.

As my hon. Friend the Member for Fife, North-East rightly said, one would never have guessed from this debate that unemployment in Scotland doubled under the labour Government. It is absurd for Opposition Members to say that they have easy answers and remedies now. The decline in manufacturing employment in Scotland began long before the Conservative Government came to office. From 1970 to 1979, during most of which time Opposition Members were in government, manufacturing employment declined by 110,000.

My hon. Friend the Member for Strathkelvin and Bearsden referred to the rate of new starts in Scotland. The statistics show that in 1981 8,000 new companies were registered in Scotland. Of course most of them are not at present major employers, but they are the seed corn from which tomorrow's major enterprises will grow. Success has been achieved—[Interruption.] I know that Opposition Members do not like to hear this. Success has been achieved in companies producing everything from computer software and hi-fi at the sophisticated end of the market to customised souvenirs for oil companies.

Numerous cases of expansion have come to my attention. My hon. Friend the Member for Banff and Buchan mentioned the announcement by Crosse and Blackwell of the creation of 140 jobs at Peterhead, and only last month Fine Fare supermarkets promised 3,500 jobs in Scotland, with the building of 12 new stores.

Mr. Robert Hughes (Aberdeen, North)

rose——

Mr. Stewart

I hear the Opposition deputy Chief Whip, the hon. Member for Aberdeen, North (Mr. Hughes), muttering away. The hon. Gentleman, I am sure, will welcome the 50 new jobs at Lovable at Cumbernauld.

Many companies get under way and expand without coming to the Government for help, but when they do come my Department has been able to help considerably. Selective financial assistance offered to companies in Scotland since 1 January this year has totalled £45 million. One hundred and eighty five projects have been involved, promising 9,636 new jobs and safeguarding a further 7,374. Do Opposition Members welcome that?

Several hon. Members have asked about regional policy. As the House knows, we are currently reviewing regional policy. My right hon. Friend the Secretary of State for Trade and Industry will shortly publish a White Paper which will set out the new structure of incentives and will invite views on several related issues, including rates of grant for assisted area coverage. The White Paper will allow a generous period for consultations. I hope that that reassures the hon. Member for Dundee, East.

I can assure the House that all the views expressed will be taken into account. May I remind the House that in our manifesto we confirmed our commitment to an effective regional policy to ease the process of change in areas which have been dependent on declining industries and to encourage new businesses in those areas. Regional policy has of course played an important part in Scotland.

I should like to answer the particular point that the right hon. Member for Glasgow, Govan (Mr. Millan) made about the autumn statement. The figures in the autumn statement reflect the reduced expenditure on regional development grant on the current basis of payment. The reason for that, as I am sure the right hon. Gentleman will appreciate, is the uneven flow of regional development grant payments because of the large capital intensive projects such as Sullom Voe, Moss Morran and BP at Grangemouth.

The hon. Members for Gordon and for Inverness, Nairn and Lochaber (Mr. Johnston) asked about the Highlands and Islands Development Board. The Government fully appreciate the problems facing the Highlands and islands and therefore attach a great deal of importance to the excellent work carried out by the board. Our commitment is shown by the substantial increases in the funds we have allocated to it—£12.7 million in 1978–79 rising to £29.8 million in the current year, including £3.5 million of the £10 million that we made available to allow the board to take special measures following the Invergordon smelter closure. The board has an excellent record, and I reaffirm the Government's full commitment to and support for it, as evidenced by the extra funds to which I have referred.

Mr. Russell Johnston

rose——

Mr. Stewart

No, I shall not give way.

Opposition Members have made a number of political points. The hon. Member for Dundee, East spoke on behalf of the Scottish National party with the full and massive authority of more than 50 lost deposits behind his party. He made the usual plea for an independent Scotland. We have heard rather less of the spurious mandate argument that Opposition Members have previously advanced.

Mr. Foulkes

rose——

Mr. Stewart

If the hon. Member wishes to advance that argument, I have no doubt that he will have plenty of other opportunities to do so.

Perhaps hon. Members are considering in more detail the Labour vote in Scotland following the 1979 election. The Labour party lost about 250,000 votes. As my hon. Friend the Member for Dumfries observed, outside the central belt of Scotland and Strathclyde——

Mr. Maxton

rose——

Mr. Stewart

Outside that area the performance of the Labour party was every bit as dismal as in the south-east of England. It is a party in decline. It has been thrown back on its traditional strongholds, and that has been evident in the speeches of Labour Members. As my hon. Friends have emphasised, there have been real and lasting improvements in the underlying position of the Scottish economy, which has gone through a long process of readjustment in changing national and international markets.

The Government's policy is designed to combat inflation as it faces a competitive economy. That is as essential for Scotland as it is for the United Kingdom as a whole. The success of our policy is clear. Inflation is down to its lowest level for almost 15 years. Interest rates have fallen by seven percentage points since the autumn of 1981. In Scotland the Government are employing a wide range of policy instruments to aid readjustment. Our education system is equipping young people with skills for the future and employers are co-operating magnificently with the youth training scheme. The SDA and the HIDB have an important part to play, but the future depends on our entrepreneurs, managers and the work force as a whole.

There is a new realism in Scotland. People throughout Scotland, whether employed in multinationals, local firms, in manufacturing or in service industries, realise that the best guarantor of jobs for the future is a satisfied customer. But customers have been ignored by the Opposition. We have hardly heard the word "customer" from Labour Members, but the customer cannot be ignored in the market place.

I believe that the Scottish economy can look forward confidently to the challenges and opportunities of the next few years. My hon. Friends have pointed to the many areas of real progress under the Government. In contrast, the Opposition's approach has been entirely negative. Their amendment does not even pay tribute to the successes and the hard work of Scottish firms, which have faced the difficulties of recession by improving productivity and by selling successfully at home and abroad. As my hon. Friend the Member for Stirling told the House, the Opposition are a party of the past with a philosophy from the past. Their policies, in so far as they have any, are packages from the past.

The next few years will show the Scottish economy turning round fundamentally. In contrast to the policies of the Opposition, those of the Government are realistic and sensible. We have not hesitated to face difficult decisions to create the right conditions for the long-term future of the Scottish economy and the long-term prosperity of the Scottish people, and that we shall continue to do.

I ask my right hon. and hon. Friends to support the Government's motion and to reject the Opposition's amendment.

Question put, That the amendment be made:—

The House divided: Ayes 186, Noes 328.

Division No. 80]	[10 pm
AYES
Adams, Allen (Paisley N)	Cowans, Harry
Alton, David	Craigen, J. M.
Anderson, Donald	Crowther, Stan
Ashdown, Paddy	Cunliffe, Lawrence
Ashley, Rt Hon Jack	Cunningham, Dr John
Ashton, Joe	Dalyell, Tam
Atkinson, N. (Tottenham)	Davies, Rt Hon Denzil (L'lli)
Bagier, Gordon A. T.	Davies, Ronald (Caerphilly)
Banks, Tony (Newham NW)	Davis, Terry (B'ham, H'ge H'l)
Barron, Kevin	Deakins, Eric
Beckett, Mrs Margaret	Dewar, Donald
Bell, Stuart	Dixon, Donald
Bidwell, Sydney	Dobson, Frank
Blair, Anthony	Dormand, Jack
Boothroyd, Miss Betty	Douglas, Dick
Bray, Dr Jeremy	Dubs, Alfred
Brown, Hugh D. (Provan)	Duffy, A. E. P.
Brown, N. (N'c'tle-u-Tyne E)	Dunwoody, Hon Mrs G.
Brown, R. (N'c'tle-u-Tyne N)	Eadie, Alex
Brown, Ron (E'burgh, Leith)	Eastham, Ken
Bruce, Malcolm	Ellis, Raymond
Callaghan, Rt Hon J.	Evans, Ioan (Cynon Valley)
Callaghan, Jim (Heyw'd & M)	Evans, John (St. Helens N)
Campbell, Ian	Ewing, Harry
Canavan, Dennis	Fatchett, Derek
Carlile, Alexander (Montg'y)	Faulds, Andrew
Carter-Jones, Lewis	Field, Frank (Birkenhead)
Cartwright, John	Fisher, Mark
Clark, Dr David (S Shields)	Flannery, Martin
Clay, Robert	Foot, Rt Hon Michael
Cocks, Rt Hon M. (Bristol S.)	Forrester, John
Cohen, Harry	Foster, Derek
Coleman, Donald	Foulkes, George
Concannon, Rt Hon J, D.	Fraser, J. (Norwood)
Conlan, Bernard	Freeson, Rt Hon Reginald
Corbett, Robin	Gilbert, Rt Hon Dr John
Corbyn, Jeremy	Godman, Dr Norman

Golding, John	Orme, Rt Hon Stanley
Gould, Bryan	Park, George
Hamilton, W. W. (Central Fife)	Parry, Robert
Harrison, Rt Hon Walter	Patchett, Terry
Hart, Rt Hon Dame Judith	Penhaligon, David
Haynes, Frank	Pike, Peter
Heffer, Eric S.	Powell, Raymond (Ogmore)
Hogg, N. (C'nauld & Kilsyth)	Prescott, John
Holland, Stuart (Vauxhall)	Radice, Giles
Hoyle, Douglas	Randall, Stuart
Hughes, Mark (Durham)	Redmond, M.
Hughes, Robert (Aberdeen N)	Rees, Rt Hon M. (Leeds S)
Hughes, Roy (Newport East)	Richardson, Ms Jo
Hughes, Sean (Knowsley S)	Roberts, Allan (Bootle)
Janner, Hon Greville	Roberts, Ernest (Hackney N)
John, Brynmor	Robertson, George
Johnston, Russell	Rooker, J. W.
Jones, Barry (Alyn & Deeside)	Ross, Ernest (Dundee W)
Kaufman, Rt Hon Gerald	Rowlands, Ted
Kennedy, Charles	Ryman, John
Kilroy-Silk, Robert	Sedgemore, Brian
Kinnock, Rt Hon Neil	Sheerman, Barry
Kirkwood, Archibald	Sheldon, Rt Hon R.
Lamond, James	Shore, Rt Hon Peter
Leadbitter, Ted	Short, Mrs R. (W'hampt'n NE)
Leighton, Ronald	Silkin, Rt Hon J.
Lewis, Ron (Carlisle)	Skinner, Dennis
Lewis, Terence (Worsley)	Smith, C. (Isl'ton S & F'bury)
Litherland, Robert	Smith, Cyril (Rochdale)
Lloyd, Tony (Stretford)	Smith, Rt Hon J. (M'kl'ds E)
Lofthouse, Geoffrey	Snape, Peter
McCartney, Hugh	Soley, Clive
McDonald, Dr Oonagh	Spearing, Nigel
McKay, Allen (Penistone)	Steel, Rt Hon David
McKelvey, William	Stewart, Rt Hon D. (W Isles)
Mackenzie, Rt Hon Gregor	Stott, Roger
Maclennan, Robert	Strang, Gavin
McNamara, Kevin	Straw, Jack
McTaggart, Robert	Thomas, Dr R. (Carmarthen)
McWilliam, John	Thompson, J. (Wansbeck)
Madden, Max	Thorne, Stan (Preston)
Marek, Dr John	Tinn, James
Marshall, David (Shettleston)	Torney, Tom
Martin, Michael	Varley, Rt Hon Eric G.
Mason, Rt Hon Roy	Wainwright, R.
Maxton, John	Wallace, James
Maynard, Miss Joan	Wardell, Gareth (Gower)
Meacher, Michael	Weetch, Ken
Meadowcroft, Michael	White, James
Michie, William	Williams, Rt Hon A.
Mikardo, Ian	Wilson, Gordon
Millan, Rt Hon Bruce	Winnick, David
Mitchell, Austin (G't Grimsby)	Woodall, Alec
Morris, Rt Hon A. (W'shawe)	Wrigglesworth, Ian
Nellist, David
Oakes, Rt Hon Gordon	Tellers for the Ayes:
O'Brien, William	Mr. James Hamilton and
O'Neill, Martin	Mr. John Home Robertson.

NOES
Adley, Robert	Body, Richard
Aitken, Jonathan	Bonsor, Sir Nicholas
Alexander, Richard	Bottomley, Peter
Amess, David	Bowden, A. (Brighton K'to'n)
Ancram, Michael	Bowden, Gerald (Dulwich)
Arnold, Tom	Boyson, Dr Rhodes
Ashby, David	Braine, Sir Bernard
Aspinwall, Jack	Brandon-Bravo, Martin
Atkins, Robert (South Ribble)	Bright, Graham
Baker, Kenneth (Mole Valley)	Brinton, Tim
Baker, Nicholas (N Dorset)	Brittan, Rt Hon Leon
Baldry, Anthony	Brooke, Hon Peter
Batiste, Spencer	Brown, M. (Brigg & Cl'thpes)
Beaumont-Dark, Anthony	Browne, John
Bellingham, Henry	Bruinvels, Peter
Benyon, William	Bryan, Sir Paul
Berry, Sir Anthony	Buchanan-Smith, Rt Hon A.
Biffen, Rt Hon John	Buck, Sir Antony
Biggs-Davison, Sir John	Budgen, Nick
Blaker, Rt Hon Sir Peter	Bulmer, Esmond

Burt, Alistair	Hayward, Robert
Butcher, John	Heath, Rt Hon Edward
Butterfill, John	Heathcoat-Amory, David
Carlisle, John (N Luton)	Heddle, John
Carlisle, Kenneth (Lincoln)	Henderson, Barry
Carttiss, Michael	Heseltine, Rt Hon Michael
Chalker, Mrs Lynda	Hickmet, Richard
Chapman, Sydney	Hicks, Robert
Chope, Christopher	Higgins, Rt Hon Terence L.
Churchill, W. S.	Hind, Kenneth
Clark, Hon A. (Plym'th S'n)	Hirst, Michael
Clark, Dr Michael (Rochford)	Hogg, Hon Douglas (Gr'th'm)
Clarke Kenneth (Rushcliffe)	Holland, Sir Philip (Gedling)
Clegg, Sir Walter	Holt, Richard
Cockeram, Eric	Hooson, Tom
Colvin, Michael	Hordern, Peter
Conway, Derek	Howard, Michael
Coombs, Simon	Howarth, Alan (Stratf'd-on-A)
Cope, John	Howarth, Gerald (Cannock)
Couchman, James	Howell, Rt Hon D. (G'ldford)
Critchley, Julian	Hubbard-Miles, Peter
Crouch, David	Hunt, David (Wirral)
Currie, Mrs Edwina	Hunt, John (Ravensbourne)
Dickens, Geoffrey	Hunter, Andrew
Dicks, T.	Hurd, Rt Hon Douglas
Dorrell, Stephen	Irving, Charles
Dover, Denshore	Jackson, Robert
Durant, Tony	Jenkin, Rt Hon Patrick
Dykes, Hugh	Johnson-Smith, Sir Geoffrey
Eggar, Tim	Jones, Gwilym (Cardiff N)
Emery, Sir Peter	Jones, Robert (W Herts)
Evennett, David	Jopling, Rt Hon Michael
Eyre, Reginald	Joseph, Rt Hon Sir Keith
Fairbairn, Nicholas	Kellett-Bowman, Mrs Elaine
Fallon, Michael	Kershaw, Sir Anthony
Favell, Anthony	Key, Robert
Fenner, Mrs Peggy	King, Roger (B'ham N'field)
Finsberg, Geoffrey	King, Rt Hon Tom
Fookes, Miss Janet	Knight, Gregory (Derby N)
Forman, Nigel	Knowles, Michael
Forsyth, Michael (Stirling)	Knox, David
Forth, Eric	Lang, Ian
Fowler, Rt Hon Norman	Latham, Michael
Fox, Marcus	Lawler, Geoffrey
Franks, Cecil	Lawrence, Ivan
Fraser, Peter (Angus East)	Lawson, Rt Hon Nigel
Freeman, Roger	Leigh, Edward (Gainsbor'gh)
Fry, Peter	Lennox-Boyd, Hon Mark
Gale, Roger	Lester, Jim
Galley, Roy	Lewis, Sir Kenneth (Stamf'd)
Gardiner, George (Reigate)	Lightbown, David
Gardner, Sir Edward (Fylde)	Lilley, Peter
Garel-Jones, Tristan	Lloyd, Ian (Havant)
Gilmour, Rt Hon Sir Ian	Lloyd, Peter, (Fareham)
Glyn, Dr Alan	Lord, Michael
Goodhart, Sir Philip	Luce, Richard
Goodlad, Alastair	Lyell, Nicholas
Gow, Ian	McCrindle, Robert
Gower, Sir Raymond	McCurley, Mrs Anna
Greenway, Harry	Macfarlane, Neil
Gregory, Conal	MacGregor, John
Griffiths, E. (B'y St Edm'ds)	MacKay, Andrew (Berkshire)
Griffiths, Peter (Portsm'th N)	MacKay, John (Argyll & Bute)
Grist, Ian	Maclean, David John.
Ground, Patrick	McNair-Wilson, M. (N'bury)
Grylls, Michael	McNair-Wilson, P. (New F'st)
Gummer, John Selwyn	McQuarrie, Albert
Hamilton, Hon A. (Epsom)	Major, John
Hamilton, Neil (Tatton)	Malins, Humfrey
Hampson, Dr Keith	Malone, Gerald
Hanley, Jeremy	Maples, John
Hannam, John	Marland, Paul
Hargreaves, Kenneth	Marlow, Antony
Harris, David	Marshall, Michael (Arundel)
Harvey, Robert	Mates, Michael
Haselhurst, Alan	Maude, Francis
Havers, Rt Hon Sir Michael	Mawhinney, Dr Brian
Hawkins, C. (High Peak)	Maxwell-Hyslop, Robin
Hawksley, Warren	Mellon David
Hayhoe, Barney	Merchant, Piers

Miller, Hal (B'grove)	Sims, Roger
Mills, Iain (Meriden)	Skeet, T. H. H.
Mills, Sir Peter (West Devon)	Smith, Tim (Beaconsfield)
Miscampbell, Norman	Soames, Hon Nicholas
Mitchell, David (NW Hants)	Spence, John
Moate, Roger	Spencer, D.
Monro, Sir Hector	Spicer, Jim (W Dorset)
Montgomery, Fergus	Spicer, Michael (S Worcs)
Moore, John	Squire, Robin
Morrison, Hon C. (Devizes)	Stanbrook, Ivor
Morrison, Hon P. (Chester)	Stanley, John
Moynihan, Hon C.	Steen, Anthony
Mudd, David	Stern, Michael
Neale, Gerrard	Stevens, Lewis (Nuneaton)
Needham, Richard	Stevens, Martin (Fulham)
Nelson, Anthony	Stewart, Allan (Eastwood)
Neubert, Michael	Stewart, Andrew (Sherwood)
Newton, Tony	Stewart, Ian (N Hertf'dshire)
Nicholls, Patrick	Stradling Thomas, J.
Normanton, Tom	Sumberg, David
Norris, Steven	Tapsell, Peter
Onslow, Cranley	Taylor, John (Solihull)
Oppenheim, Philip	Taylor, Teddy (S'end E)
Oppenheim, Rt Hon Mrs S.	Tebbit, Rt Hon Norman
Ottaway, Richard	Temple-Morris, Peter
Page, Richard (Herts SW)	Terlezki, Stefan
Parris, Matthew	Thompson, Donald (Calder V)
Patten, John (Oxford)	Thompson, Patrick (N'ich N)
Pattie, Geoffrey	Thorne, Neil (llford S)
Pawsey, James	Thornton, Malcolm
Peacock, Mrs Elizabeth	Thurnham, Peter
Pink, R. Bonner	Townend, John (Bridlington)
Pollock, Alexander	Tracey, Richard
Porter, Barry	Twinn, Dr Ian
Powell, William (Corby)	van Straubenzee, Sir W.
Powley, John	Vaughan, Dr Gerard
Prentice, Rt Hon Reg	Viggers, Peter
Price, Sir David	Waddington, David
Raffan, Keith	Wakeham, Rt Hon John
Raison, Rt Hon Timothy	Waldegrave, Hon William
Rathbone, Tim	Walden, George
Rees, Rt Hon Peter (Dover)	Walker, Rt Hon P. (W'cester)
Renton, Tim	Wall, Sir Patrick
Rhodes James, Robert	Waller, Gary
Rhys Williams, Sir Brandon	Walters, Dennis
Ridley, Rt Hon Nicholas	Wardle, C. (Bexhill)
Ridsdale, Sir Julian	Warren, Kenneth
Roberts, Wyn (Conwy)	Watson, John
Robinson, Mark (N'port W)	Watts, John
Roe, Mrs Marion	Wells, Bowen (Hertford)
Rost, Peter	Wells, John (Maidstone)
Rowe, Andrew	Wheeler, John
Rumbold, Mrs Angela	Whitfield, John
Ryder, Richard	Whitney, Raymond
Sackville, Hon Thomas	Winterton, Mrs Ann
Sainsbury, Hon Timothy	Winterton, Nicholas
St. John-Stevas, Rt Hon N.	Wolfson, Mark
Sayeed, Jonathan	Wood, Timothy
Scott, Nicholas	Woodcock, Michael
Shaw, Giles (Pudsey)	Yeo, Tim
Shaw, Sir Michael (Scarb')	Young, Sir George (Acton)
Shelton, William (Streatham)	Younger, Rt Hon George
Shepherd, Colin (Hereford)
Shepherd, Richard (Aldridge)	Tellers for the Noes:
Shersby, Michael	Mr. Carol Mather and
Silvester, Fred	Mr. Robert Boscawen

Question accordingly negatived

Main Question put:—

The House divided: Ayes 326, Noes 185.

Division No. 81]	[10.13 pm
AYES
Adley, Robert	Ashby, David
Aitken, Jonathan	Aspinwall, Jack
Alexander, Richard	Atkins, Robert (South Ribble)
Amess, David	Baker, Kenneth (Mole Valley)
Ancram, Michael	Baker, Nicholas (N Dorset)
Arnold, Tom	Baldry, Anthony

Batiste, Spencer	Gilmour, Rt Hon Sir Ian
Beaumont-Dark, Anthony	Glyn, Dr Alan
Bellingham, Henry	Goodhart, Sir Philip
Benyon, William	Goodlad, Alastair
Berry, Sir Anthony	Gow, Ian
Biffen, Rt Hon John	Gower, Sir Raymond
Biggs-Davison, Sir John	Greenway, Harry
Blaker, Rt Hon Sir Peter	Gregory, Conal
Body, Richard	Griffiths, E. (B'y St Edm'ds)
Bonsor, Sir Nicholas	Griffiths, Peter (Portsm'th N)
Bottomley, Peter	Grist, Ian
Bowden, A. (Brighton K'to'n)	Ground, Patrick
Bowden, Gerald (Dulwich)	Grylls, Michael
Boyson, Dr Rhodes	Gummer, John Selwyn
Braine, Sir Bernard	Hamilton, Hon A. (Epsom)
Brandon-Bravo, Martin	Hamilton, Neil (Tatton)
Bright, Graham	Hampson, Dr Keith
Brinton, Tim	Hanley, Jeremy
Brittan, Rt Hon Leon	Hannam, John
Brooke, Hon Peter	Hargreaves, Kenneth
Brown, M. (Brigg & Cl'thpes)	Harris, David
Browne, John	Harvey, Robert
Bruinvels, Peter	Haselhurst, Alan
Bryan, Sir Paul	Havers, Rt Hon Sir Michael
Buchanan-Smith, Rt Hon A.	Hawkins, C. (High Peak)
Buck, Sir Antony	Hawksley, Warren
Budgen, Nick	Hayhoe, Barney
Bulmer, Esmond	Hayward, Robert
Burt, Alistair	Heath, Rt Hon Edward
Butcher, John	Heathcoat-Amory, David
Butterfill, John	Heddle, John
Carlisle, John (N Luton)	Henderson, Barry
Carlisle, Kenneth (Lincoln)	Heseltine, Rt Hon Michael
Carttiss, Michael	Hickmet, Richard
Chalker, Mrs Lynda	Hicks, Robert
Chapman, Sydney	Higgins, Rt Hon Terence L.
Chope, Christopher	Hind, Kenneth
Churchill, W. S.	Hirst, Michael
Clark, Hon A. (Plym'th S'n)	Hogg, Hon Douglas (Gr'th'm)
Clark, Dr Michael (Rochford)	Holland, Sir Philip (Gedling)
Clarke Kenneth (Rushcliffe)	Holt, Richard
Clegg, Sir Walter	Hooson, Tom
Cockeram, Eric	Hordern, Peter
Colvin, Michael	Howard, Michael
Conway, Derek	Howarth, Alan (Stratf'd-on-A)
Coombs, Simon	Howarth, Gerald (Cannock)
Cope, John	Howell, Rt Hon D. (G'ldford)
Couchman, James	Hubbard-Miles, Peter
Crouch, David	Hunt, David (Wirral)
Currie, Mrs Edwina	Hunt, John (Ravensbourne)
Dickens, Geoffrey	Hunter, Andrew
Dicks, T.	Hurd, Rt Hon Douglas
Dorrell, Stephen	Irving, Charles
Dover, Denshore	Jackson, Robert
Durant, Tony	Jenkin, Rt Hon Patrick
Dykes, Hugh	Johnson-Smith, Sir Geoffrey
Eggar, Tim	Jones, Gwilym (Cardiff N)
Emery, Sir Peter	Jones, Robert (W Herts)
Evennett, David	Jopling, Rt Hon Michael
Eyre, Reginald	Joseph, Rt Hon Sir Keith
Fairbairn, Nicholas	Kellett-Bowman, Mrs Elaine
Fallon, Michael	Kershaw, Sir Anthony
Favell, Anthony	Key, Robert
Fenner, Mrs Peggy	King, Roger (B'ham N field)
Finsberg, Geoffrey	King, Rt Hon Tom
Fookes, Miss Janet	Knight, Gregory (Derby N)
Forman, Nigel	Knowles, Michael
Forsyth, Michael (Stirling)	Knox, David
Forth, Eric	Lang, Ian
Fowler, Rt Hon Norman	Latham, Michael
Fox, Marcus	Lawler, Geoffrey
Franks, Cecil	Lawrence, Ivan
Fraser, Peter (Angus East)	Lawson, Rt Hon Nigel
Freeman, Roger	Leigh, Edward (Gainsbor'gh)
Fry, Peter	Lennox-Boyd, Hon Mark
Gale, Roger	Lester, Jim
Galley, Roy	Lewis, Sir Kenneth (Stamf'd)
Gardiner, George (Reigate)	Lightbown, David
Gardner, Sir Edward (Fylde)	Lilley, Peter
Garel-Jones, Tristan	Lloyd, Ian (Havant)

Lloyd, Peter, (Fareham)	Rumbold, Mrs Angela
Lord, Michael	Ryder, Richard
Luce, Richard	Sackville, Hon Thomas
Lyell, Nicholas	Sainsbury, Hon Timothy
McCrindle, Robert	St. John-Stevas, Rt Hon N.
McCurley, Mrs Anna	Sayeed, Jonathan
Macfarlane, Neil	Scott, Nicholas
MacGregor, John	Shaw, Giles (Pudsey)
MacKay, Andrew (Berkshire)	Shaw, Sir Michael (Scarb')
MacKay, John (Argyll & Bute)	Shelton, William (Streatham)
Maclean, David John.	Shepherd, Colin (Hereford)
McNair-Wilson, M. (N'bury)	Shepherd, Richard (Aldridge)
McNair-Wilson, P. (New F'st)	Shersby, Michael
McQuarrie, Albert	Sims, Roger
Major, John	Skeet, T. H. H.
Malins, Humfrey	Smith, Tim (Beaconsfield)
Malone, Gerald	Soames, Hon Nicholas
Maples, John	Spence, John
Marland, Paul	Spencer, D.
Marlow, Antony	Spicer, Jim (W Dorset)
Marshall, Michael (Arundel)	Spicer, Michael (S Worcs)
Mates, Michael	Squire, Robin
Maude, Francis	Stanbrook, Ivor
Mawhinney, Dr Brian	Stanley, John
Maxwell-Hyslop, Robin	Steen, Anthony
Mellor, David	Stern, Michael
Merchant, Piers	Stevens, Lewis (Nuneaton)
Miller, Hal (B'grove)	Stevens, Martin (Fulham)
Mills, Iain (Meriden)	Stewart, Allan (Eastwood)
Mills, Sir Peter (West Devon)	Stewart, Andrew (Sherwood)
Miscampbell, Norman	Stewart, Ian (N Hertf'dshire)
Mitchell, David (NW Hants)	Stradling Thomas, J.
Moate, Roger	Sumberg, David
Monro, Sir Hector	Tapsell, Peter
Montgomery, Fergus	Taylor, John (Solihull)
Moore, John	Taylor, Teddy (S'end E)
Morrison, Hon C. (Devizes)	Tebbit, Rt Hon Norman
Morrison, Hon P. (Chester)	Temple-Morris, Peter
Moynihan, Hon C.	Terlezki, Stefan
Mudd, David	Thompson, Donald (Calder V)
Neale, Gerrard	Thompson, Patrick (N'ich N)
Needham, Richard	Thorne, Neil (llford S)
Nelson, Anthony	Thornton, Malcolm
Neubert, Michael	Thurnham, Peter
Newton, Tony	Townend, John (Bridlington)
Nicholls, Patrick	Tracey, Richard
Normanton, Tom	Twinn, Dr Ian
Norris, Steven	van Straubenzee, Sir W.
Onslow, Cranley	Vaughan, Dr Gerard
Oppenheim, Philip	Viggers, Peter
Oppenheim, Rt Hon Mrs S.	Waddington, David
Ottaway, Richard	Wakeham, Rt Hon John
Page, Richard (Herts SW)	Waldegrave, Hon William
Parris, Matthew	Walden, George
Patten, John (Oxford)	Walker, Rt Hon P. (W'cester)
Pattie, Geoffrey	Wall, Sir Patrick
Pawsey, James	Waller, Gary
Peacock, Mrs Elizabeth	Walters, Dennis
Pink, R. Bonner	Wardle, C. (Bexhill)
Pollock, Alexander	Warren, Kenneth
Porter, Barry	Watson, John
Powell, William (Corby)	Watts, John
Powley, John	Wells, Bowen (Hertford)
Prentice, Rt Hon Reg	Wells, John (Maidstone)
Price, Sir David	Wheeler, John
Raffan, Keith	Whitfield, John
Raison, Rt Hon Timothy	Whitney, Raymond
Rathbone, Tim	Winterton, Mrs Ann
Rees, Rt Hon Peter (Dover)	Winterton, Nicholas
Renton, Tim	Wolfson, Mark
Rhodes James, Robert	Wood, Timothy
Rhys Williams, Sir Brandon	Woodcock, Michael
Ridley, Rt Hon Nicholas	Yeo, Tim
Ridsdale, Sir Julian	Young, Sir George (Acton)
Roberts, Wyn (Conwy)	Younger, Rt Hon George
Robinson, Mark (N'port W)
Roe, Mrs Marion	Tellers for the Ayes:
Rost, Peter	Mr. Carol Mather and
Rowe, Andrew	Mr. Robert Boscawen.

NOES
Adams, Allen (Paisley N)	Heffer, Eric S.
Alton, David	Hogg, N. (C'nauld & Kilsyth)
Anderson, Donald	Holland, Stuart (Vauxhall)
Ashdown, Paddy	Hoyle, Douglas
Ashley, Rt Hon Jack	Hughes, Mark (Durham)
Ashton, Joe	Hughes, Robert (Aberdeen N)
Atkinson, N. (Tottenham)	Hughes, Roy (Newport East)
Bagier, Gordon A. T.	Hughes, Sean (Knowsley S)
Banks, Tony (Newham NW)	Hughes, Simon (Southwark)
Barron, Kevin	Janner, Hon Greville
Beckett, Mrs Margaret	John, Brynmor
Bell, Stuart	Johnston, Russell
Bidwell, Sydney	Jones, Barry (Alyn & Deeside)
Blair, Anthony	Kaufman, Rt Hon Gerald
Boothroyd, Miss Betty	Kennedy, Charles
Bray, Dr Jeremy	Kilroy-Silk, Robert
Brown, Hugh D. (Provan)	Kinnock, Rt Hon Neil
Brown, N. (N'c'tle-u-Tyne E)	Kirkwood, Archibald
Brown, R. (N'c'tle-u-Tyne N)	Lamond, James
Brown, Ron (E'burgh, Leith)	Leadbitter, Ted
Bruce, Malcolm	Leighton, Ronald
Callaghan, Jim (Heyw'd & M)	Lewis, Ron (Carlisle)
Campbell, Ian	Lewis, Terence (Worsley)
Canavan, Dennis	Litherland, Robert
Carlile, Alexander (Montg'y)	Lloyd, Tony (Stretford)
Carter-Jones, Lewis	Lofthouse, Geoffrey
Cartwright, John	McCartney, Hugh
Clark, Dr David (S Shields)	McDonald, Dr Oonagh
Clay, Robert	McKay, Allen (Penistone)
Cocks, Rt Hon M. (Bristol S.)	McKelvey, William
Cohen, Harry	Mackenzie, Rt Hon Gregor
Coleman, Donald	Maclennan, Robert
Concannon, Rt Hon J. D.	McNamara, Kevin
Conlan, Bernard	McTaggart, Robert
Corbett, Robin	McWilliam, John
Corbyn, Jeremy	Madden, Max
Cowans, Harry	Marek, Dr John
Craigen, J. M.	Marshall, David (Shettleston)
Crowther, Stan	Martin, Michael
Cunliffe, Lawrence	Mason, Rt Hon Roy
Cunningham, Dr John	Maxton, John
Dalyell, Tam	Maynard, Miss Joan
Davies, Rt Hon Denzil (L'lli)	Meacher, Michael
Davies, Ronald (Caerphilly)	Meadowcroft, Michael
Davis, Terry (B'ham, H'ge H'l)	Michie, William
Deakins, Eric	Mikardo, Ian
Dewar, Donald	Millan, Rt Hon Bruce
Dixon, Donald	Mitchell, Austin (G't Grimsby)
Dobson, Frank	Morris, Rt Hon A. (W'shawe)
Dormand, Jack	Nellist, David
Douglas, Dick	Oakes, Rt Hon Gordon
Dubs, Alfred	O'Brien, William
Duffy, A. E. P.	O'Neill, Martin
Dunwoody, Hon Mrs G.	Orme, Rt Hon Stanley
Eadie, Alex	Park, George
Eastham, Ken	Parry, Robert
Ellis, Raymond	Patchett, Terry
Evans, Ioan (Cynon Valley)	Penhaligon, David
Evans, John (St. Helens N)	Pike, Peter
Ewing, Harry	Powell, Raymond (Ogmore)
Fatchett, Derek	Prescott, John
Faulds, Andrew	Radice, Giles
Field, Frank (Birkenhead)	Randall, Stuart
Fisher, Mark	Redmond, M.
Flannery, Martin	Rees, Rt Hon M. (Leeds S)
Foot, Rt Hon Michael	Richardson, Ms Jo
Forrester, John	Roberts, Allan (Bootle)
Foster, Derek	Roberts, Ernest (Hackney N)
Foulkes, George	Robertson, George
Fraser, J. (Norwood)	Rooker, J. W.
Freeson, Rt Hon Reginald	Ross, Ernest (Dundee W)
Gilbert, Rt Hon Dr John	Rowlands, Ted
Godman, Dr Norman	Ryman, John
Golding, John	Sedgemore, Brian
Gould, Bryan	Sheerman, Barry
Hamilton, W. W. (Central Fife)	Sheldon, Rt Hon R.
Harrison, Rt Hon Walter	Shore, Rt Hon Peter
Hart, Rt Hon Dame Judith	Short, Mrs R. (W'hampt'n NE)
Haynes, Frank	Silkin, Rt Hon J.

Skinner, Dennis	Torney, Tom
Smith, C. (Isl'ton S & F'bury)	Varley, Rt Hon Eric G.
Smith, Cyril (Rochdale)	Wallace, James
Smith, Rt Hon J. (M'kl'ds E)	Warden, Gareth (Gower)
Snape, Peter	Weetch, Ken
Soley, Clive	White, James
Spearing, Nigel	Williams, Rt Hon A.
Steel, Rt Hon David	Wilson, Gordon
Stewart, Rt Hon D. (W Isles)	Winnick, David
Stott, Roger	Woodall, Alec
Strang, Gavin	Wrigglesworth, Ian
Straw, Jack
Thomas, Dr R. (Carmarthen)	Tellers for the Noes:
Thompson, J. (Wansbeck)	Mr. James Hamilton and.
Thorne, Stan (Preston)	Mr. John Home Robertson.
Tinn, James

Question accordingly agreed to.

Resolved, That this House welcomes the remarkable progress made in restructuring and strengthening the Scottish economy through the emergency of innovative new firms, the attraction of high technology investment, the growth of financial and business services, the seizing of the industrial opportunities afforded by North Sea oil, and the modernisaton of traditional industries, thus equipping Scottish industry to compete more effectively in home and overseas markets; and the major initiatives by the Government in improving the training system so that all unemployed may take full advantage of these new opportunities.