§ 1.1 pm
§ Mr. David Alton (Liverpool, Mossley Hill)
In following the speech of the right hon. and learned Member for Warrington, South (Mr. Carlisle) I am glad to say that I shall be saying a word or two at the end of my remarks about the problems of the River Mersey and one way of perhaps tackling unemployment in our area. I suggest that the construction of the Mersey barrage would help to assist jobless people in Merseyside and also be part of a campaign to clean up the Mersey and turn it into a resource for the people of our conurbation.
I want to use the opportunity of today's Adjournment debate to focus the attention of the House on the effect of the Goverment's economic policies, specifically on the city of Liverpool. Obviously, I shall talk about what the city can do for itself, but my primary purpose is to paint a picture for the House, and I intend to divide my remarks into four parts.
First, I shall outline the general effects of the Government's economic policy and will contend that it totally fails to address itself to the deep-seated problems of cities such as mine. Secondly, I shall fill in the detail on the canvas, placing before the House figures which demonstrate how Government policies have specifically affected Liverpool. Thirdly, I want to say something about the immediate implications of the policies. Finally, I want to put some proposals to the Minister, and I hope that she will be able to respond to them.
I shall begin with the broad thrust of the Government's economic policy. Within the past couple of weeks the House has had a chance to consider the Government's White Paper on public expenditure and the Budget. The 500,000 citizens of Liverpool awaited the Chancellor's Budget statement with great expectations. As the pundits raked over the entrails during the run-up to the Budget announcement, many commentators predicted that extra resources would be made available to fight poverty or to combat mass unemployment. The commentators, like the citizens of Liverpool, were badly disappointed. Liverpool people waited in vain as the Chancellor's statement meandered on to hear what he intended to do about unemployment. It was on that criterion alone that the Budget was to be judged in the north of England.
The absence of any proposal of substance led many of us to the conclusion that the Government, and perhaps particularly the Prime Minister, do not care. The right hon. Lady does not seem to care about Liverpool or about the unemployed generally. It is not that the people of Liverpool or I blame her for every person who has become unemployed, although one person has become unemployed every minute of every day since the Government were elected in 1979. It is not even that we blame her for everything that is wrong in Liverpool or Britain. However, people do blame her for not caring. Liverpool seems to be treated like some sort of distant outpost of the empire—out of sight, out of mind. If the Prime Minister occasionally came to see for herself the heartbreak which her policies have created, I do not believe that it would leave even the hardest-hearted person unmoved.
Last week the Prime Minister and the Chancellor had certain choices. They could either do something about unemployment, or cut taxes, in this case by 1p in the pound. She chose to cut taxes, and we are confidently told 1116 that the £1 billion give-away is the prelude to a further bonanza of between £4 billion and £5 billion next year, reducing the standard rate to 25p in the pound.
In examining the choice that the Prime Minister made, it is evident once again that unemployment has been given a low priority. She could have used that £1 billion to create thousands of construction jobs or to cut by 10 per cent. the national insurance contribution that employers pay. Either way, it would have created jobs. If the Prime Minister cares, she could have used that £1 billion to improve on the 40p increase coming to pensioners in July, or to help pay their fuel bills after the shivering cold winter. She could have used that £1 billion to fight poverty and create a fairer Britain. Instead, she gave it all away, just like she has frittered away the £30 billion oil revenue that has come into our country's coffers over the past six years. That is money which should have been used to invest in Britain's future.
Our economy under the Government has been run rather like a giant jumble sale, where everything must go. National assets, resources and companies such as Westland, Land Rover and British Leyland—some £7 billion of national assets—have been flogged off at knock-down prices in the past five years. Another £14 billion worth is earmarked for similar treatment between now and 1989.
Notwithstanding the morality of such policies, perhaps my complaint about the economic thrust would be lessened if I could see any evidence that this country's considerable resources were being reinvested to create a happier and more prosperous Britain. However, popular capitalism, as it has come to be known, which presumably implies that everybody should have a stake, is simply not available or relevant to the unemployed, the poor, the powerless or the alienated in our inner cities. Deliberately encouraging people to care for number one and abandon their concern for others deepens the divisions in Britain.
Another aspect of the Government's general economic approach as it affects Liverpool deeply troubles me. It concerns the social and economic cost of leaving so many people without work. In the United Kingdom, in 1986, it is estimated that it will cost some £23 billion to keep 3.4 million people out of work. The bill comes to £2.5 billion on Merseyside alone. Apart from the personal trauma which being unemployed causes anyone who loses his job, the waste of resources is self-evident. This year, we will spend as a nation three times more on social security than on education, ten times more than on law and order and transport, three times more than on health, and seven times more than on housing or creating jobs. That is popular capitalism in action.
The social consequences of unemployment are also enormous. To realise that one has only to look at the crime rate in areas of mass unemployment. In Liverpool, one crime takes place very three minutes and half the crimes are committed by unemployed young people. Thousands of young people have filled their empty lives with the quick fix of the heroin pusher, others have committed suicide, and yet others have been made easy cannon fodder for Derek Hatton's Militants. It is in that context that the Government's economic policies must be judged. It is a picture which serves to underline the sheer irrelevance of tax cuts when so many other priorities were waiting to be tackled.
Turning from the general picture, I said that I would paint some detail on to the canvas. Nine hundred years 1117 ago, William the Conqueror commissioned the Domesday Book as a survey of the state of the nation. It revealed a divided nation. The survey was taken in the aftermath of William's campaign to break the spirit of the dissidents and rebels of the north. After that, he was also to be known as the harrier of the north. The Domesday Book reveals an economy that was ruthlessly destroyed in order to create fear and subservience among the citizens.
There are clearly some parallels which could be drawn with today. Unemployment in the north has been used as a way of keeping the people down, of creating a climate of fear. Jobs have been destroyed, often quite needlessly, all in the name of political dogma, and, to some extent, because of the Prime Minister's personal vanity. It is now six years since the Prime Minister said that she hoped that unemployment would not hit 2.5 million. It was in the same year that she correctly observed that poverty, wherever, it exists, is the enemy of stability. Today 3.4 million people are jobless. In cities like Liverpool political stability has been ruptured, partly thanks to the abdication by the Government of their responsibility for the welfare of their citizens.
Today, there are a phenomenal 107,891 Liverpool people on the dole—one in five—comprising 78,321 men and 29,570 women. We should look a little more closely at the profile of those who are unemployed. Among young people, the prospects of getting a job are negligible. A staggering 42,000 under the age of 24 are without work, and there is a youth unemployment rate of 39 per cent.
People are also being consigned to the dole for much longer periods—almost indefinite periods in some cases. Whereas, in 1979, 37 per cent. of unemployment was for more than a year's duration, by 1985 that figure had risen to 53 per cent. The continuing massive level of unemployment and the length of unemployment inevitably have cumulative effects on personal incomes and social conditions in the city generally. The loss of jobs, more part-time work and a growing proportion of female employment is leading to a relative decline in income levels. By way of example, in 1981, 28 per cent. of children in the city received free school meals. By last year, the proportion was over 50 per cent.
Compounding Liverpool's unemployment problem has been the huge loss of population. This should serve as a warning to those who prescribe the purchase of bicycle clips as a way of solving unemployment. People have been leaving Liverpool hand over fist, and look where it has left us. Liverpool has lost a third of its population in the last 25 years. Between 1966 and 1971 we lost people at the rate of 22,000 a year. Between 1971 and 1981 they left at the rate of 8,740 a year. Over the last five years they have left at the rate of 6,500 a year. This has bled the city of ratepayers, self-starters and entrepreneurs.
There are also proportionately more people in vulnerable groups. The growth in pensioner households, the over-80s—the fastest growing group in the city—single parents, the unemployed and the permanently sick place impossible demands on the local authority's reduced resources and on its services. The sombre and chilling reality for Liverpool is that, if job losses do not slow down, migration will again increase as the more mobile seek job opportunities elsewhere. This will simply further compound Liverpool's problems and turn it into a ghost town.
1118 It is to this change in Liverpool's demography that the Government must address themselves. Liverpool, 1986, is not Liverpool, 1971. In 1971, 42.1 per cent. of the total population were employed and 4.5 per cent. were unemployed. By 1985 that had changed to 34 per cent. being employed, with 12.7 per cent. of the total population being unemployed. This meant that 20 per cent. of the total employable work force were out of work.
Other things have changed, too. During the same period the number of children has fallen by a third. In 1971 they comprised a quarter of the population. In 1985 they comprised only a fifth. During the same period the number of retired people rose from 13.6 to 17.8 per cent. It is in this context of desperate need and changed circumstances that the Government's economic policies must be judged. It is in this context of a dole queue which has doubled between 1971 and 1981 that the House must judge the relevance or sense of the Government's present economic policies.
I said that I would turn to a third area. This concerns the immediate implications of Government policies in Liverpool. Since 1979, the Government have cut some £285 million of rate support grant. In addition, we have lost £30 million from higher education, £98 million in housing subsidies and £150 million from the housing programme. During the last two years the city council has destroyed a perfectly good case in pleading for a reversal of this disastrous national policy by hurtling the city and its citizens towards chaos at each and every opportunity. Derek Hatton has played right into the Prime Minister's hands.
The latest damning indictment of Militant Labour's tactics was published only yesterday in a 47-page report by Mr. Tim McMahon, the district auditor. He says that he has never seen an administration act as irresponsibly as this one has done. The council has undoubtedly damaged Liverpool's reputation to the point where some constituents have told me that they are ashamed even to admit to outsiders that they come from a city of which its citizens have been traditionally proud.
At midnight on 2 April, if there is no appeal by the 48 Labour councillors who have been disqualified from public office because of the reckless way in which they have run the city, the city's affairs will be in the hands of sensible people: Liberals, sensible members of the Labour party and Conservatives. I hope that they will unite to give the city the leadership that it deserves, but they will need resources. There is an immediate deficit of £37 million to be faced.
I must warn the Government that there is no point in sending emissaries to Sir Trevor Jones, the leader of the Liberal group, telling him to make cuts by sacking the work force. During the years that we were in control, we never made a single person compulsorily redundant, and we do not intend to start now. Sacking people in Liverpool will simply lead to social disorder on a grand scale. What is needed is a sensitive and humanitarian response, or we will create the climate for Militant to whip up more bitterness, hatred and sectarian discord.
May I also plead with the Government that if the councillors decide to appeal, the Lord Chancellor has a duty to ensure that those appeals are heard as rapidly as possible, so that this long-running saga may be quickly brought to an end.
The final part of my remarks are concerned with positive proposals, which I hope the Minister will 1119 examine. First, after the disappearance of the Merseyside county council as an umbrella organisation, a number of useful initiatives could disappear. I hope that the Government will accept some responsibility for that. Particularly, I refer, as I did at the outset of my remarks, to the construction of the Mersey barrage. If a barrage were created across the Mersey, not only would it impound the Mersey and create massive recreational facilities, but it would create a third of the electricity requirements of the area and a new deep sea water facility for berthing oceangoing vessels in the mouth of the Mersey. It would also create a massive number of jobs in the construction industry. It would be a symbol of hope for the people of Liverpool.
Archbishop Warlock, the Roman Catholic Archbishop of Liverpool, said at a civic service just two weeks ago:Just at this time our city and much of the County lies wounded. But for the spirit of the people it might well be hard to maintain hope. If we are to counter what we believe to be a false image of our part of the country, we must not only pick ourselves up but as one body work together to renew the life and activity of a people who brought greatness to Merseyside. There are new opportunities, new challenges to be faced: new goals to be won…Perhaps the new much-discussed Mersey Barrage is the symbol we need. A renewed role for the old Mersey. New jobs. Improved environment. A new source of energy for ourselves and for many more throughout our land.The barrage would also be a symbol of partnership between private and public enterprise. I hope it is one that the Government will back.
I hope that the Minister will also say a word or two about the possibility of moving the intervention board headquarters from Reading to Liverpool. I know that the Government are considering this proposition and that bids have been put in by Manchester Conservative Members of Parliament to the Minister of Agriculture, Fisheries and Food. I have written to him on this question this week, and I hope that we will be given some news.
I hope also that when the franchise for Granada Television in the north of England is renewed, the Minister will consider splitting the franchise and creating a new television station based on Merseyside. That would help to create many jobs in the entertainment industry. Liverpool is famous for its comedians—although we never thought that we would see them running the city council—and for its musicians, actors, playwrights and poets. A new television station would help to improve Merseyside's image. Liverpool people as well as the Minister should address their minds to the point that, unless we improve the image of our conurbation, we cannot hope to bring new enterprise to the area.
With the disappearance of the county council there will be a need for a regional development agency, along the lines of the Scottish model, and for a tourist board. We should look at the ways in which we support the local free port, which has been very successful. Last year more than £17 million of work came through the free port. If changes in the operation of VAT were made in the free port, more business would be attracted.
Voluntary organisations, which create much work in Liverpool, are in extreme difficulty because of funding cuts. The local council has been intransigent in assuming the responsibilities previously held by the county councils. Although I am grateful to Lord Elton for the help that he 1120 has given and for meeting the groups that I have taken to see him, I hope that the Under-Secretary of State will say more about this matter.
In conclusion, I hope that, in the longer term, we will see a complete reversal of the Government's damaging economic policies. I very much hope that the Chancellor will take the opportunity in his autumn statement to redress some of the grievances that I have mentioned—
§ Mr. Deputy Speaker (Mr. Harold Walker)
Order. I hope the hon. Member appreciates that this debate should finish at 1.30 pm. If he wants the Under-Secretary of State to reply, he should conclude quickly.
§ Mr. Alton
I was on my last sentence, Mr. Deputy Speaker. I did say, "In conclusion." I hope that the Chancellor in his autumn statement will redress some of the grievances that I have mentioned and use some of the moneys in the unusually large Contingency Fund to tackle the nation's decaying infrastructure and especially the problems of Liverpool.
§ The Parliamentary Under-Secretary of State for the Environment (Mrs. Angela Rumbold)
I shall respond as briefly as I can to the important subject raised by the hon. Member for Liverpool, Mossley Hill (Mr. Alton). In his opening remarks he attacked the Government for their economic policies. I was somewhat surprised to learn of his view and to see that he totally ignored the realities. There has been a clear recovery of our economy, with 3.5 per cent. more growth, providing the stability and security that will help to overcome many of the difficulties faced by northern cities such as Liverpool. I shall come to the hon. Gentleman's point about positive unemployment measures which the Government have taken in the Budget.
On the general points about the north, I should like to point out that local government as a whole, irrespective of its political control, can take up the advantages of Government initiatives—Newcastle, for example, has managed to take advantage of them—and provide the infrastructure for those cities, which have undoubtedly suffered with the disappearance of traditional businesses and industries, but which have now begun to regenerate themselves with great assistance from the Government. Liverpool, alas, did not take advantage of those Government initiatives, because of the curious leadership on the council. To a certain extent, therefore, it is Liverpool's fault that much of what could have been done to help the Liverpool people, for whom all of us have great sympathy, was ignored.
The hon. Member for Mossley Hill referred to a great deal of money which should have gone to Liverpool council and could have helped the city to make a better recovery. I must point out that the city could always have earned more money if there had been sensible planning and if it had used the efficient methods of running local government used by many councils. For example, in 1985–86, Liverpool city council had a budget of £265 million, which led to the city being rate capped. Under these proposals, the city was given a grant of only £30 million. Because the council had to bring its budget down to £222 million, it earned itself an extra £90 million. That happened simply because of the necessity to behave properly. That gave the city a total of £119 million of Government grant, which was much better than anything the councillors had originally proposed.
1121 I understand that the district auditor's report has just been sent to the council. The hon. Member for Mossley Hill will appreciate that that is a matter between the district auditor and the councillors. We understand that it is a private report. We shall be extremely interested to see what it says and to note the council's response.
At the heart of the Government's policies relating directly to Liverpool is a recognition of the fact that for many years Liverpool's economy has been in decline. We have believed that to achieve a wider regeneration of the area priority must be given to creating a climate in which the private sector is encouraged to grow. That will enable the spirit of enterprise and innovation to flourish, in just the same way as I have mentioned that it has and can flourish in other cities in the north. The Government's policies have therefore been geared to provide the means for improving the quality of the local environment, living conditions, and working skills of people. In consequence, that should make the area more attractive to local entrepreneurs and private investors as a place to develop and expand their businesses, and I could give many examples where that has happened.
The hon. Member for Mossley Hill is aware that Liverpool, as a development area, receives the highest level of Government support when firms decide to move in or to expand their businesses in that area. It receives a high allocation of funds from the Manpower Services Commission's programmes which are aimed at youth training, the community programme and the enterprise allowance scheme. It is a partnership authority under the Inner Urban Areas Act 1978, receiving a high level of aid from the Department's urban programme. Within its area there is an urban development corporation geared to regenerating extensive areas of Liverpool dockland and the enterprise zone at Speke designated in 1981 to encourage new industrial and commercial development. As the hon. Gentleman rightly mentioned, there is a free port, which, I am glad to hear, he is happy to encourage in its operation. Much has been attempted to assist and underpin the decline in Liverpool.
A massive £24 million was committed through the urban programme alone. As the hon. Gentleman said, the city council chose, unwisely in the Government's view, not to direct this money towards economic and industrial regeneration. I do not want to dwell on the council's failures. I should like to say, however, that it is important to recognise that the Government have, through their urban programme, provided a unique opportunity for job creation and economic development. Unfortunately, so far, the council has refused to take up that opportunity.
Liverpool has benefited from the Government's policy of targeting derelict land grant towards sites with hard after-uses, particularly in industrial and commercial development. Some £8.5 million has been spent since 1983 to reclaim sites for industry and generally to improve the quality of the environment, and to encourage investors into the area. No doubt the hon. Gentleman knows that one of the most spectacular examples of that occurred within his constituency, at Wavertree.
The hon. Gentleman will know that in 1981 the Government established the Merseyside development corporation to regenerate no fewer than 865 acres of massively derelict and disused dockland at the heart of the area. It was recognised from the outset that substantial 1122 public funding would be required to achieve the corporation's objectives. All in all, capital expenditure so far in Liverpool has totalled £97 million.
I would remind the hon. Gentleman that the corporation successfully mounted the first ever international garden festival to be held in this country. It attracted about 3.3 million visitors, and its great success brought new confidence to the area. I hope that that will continue to operate successfully under the private sector development initiative.
The co-operation of Government Departments in the way that I have said has also produced other new developments. For example, nine information technology centres, four commercial business centres, and three small firms workshops have been set up in the wider Merseyside area, all designed to assist in the training of people, particularly in new technology.
Most recently, as the hon. Gentleman will know, the task force has been encouraging the establishment of job clubs, which are aimed specifically at helping the longterm unemployed to find work. About 11 such centres are to be established in Liverpool this year.
I should like to consider some of the problems that have been raised about unemployment. The hon. Gentleman will know that the Government place great emphasis on the need to raise the level of skills and provide training and retraining facilities for both youngsters and adults in Liverpool. In 1985–86, 12,000 places will have been filled on youth and adult training schemes. Places have been provided under the community programme and the voluntary project programme, and support for initiative and enterprise has been given by the enterprise alliance scheme. So far, over 300 people have taken advantage of that. As the hon. Gentleman knows, the Budget proposals last week included further initiatives for training under the community programme, many of which I hope and trust will find support in the city of Liverpool.
All those policies for Liverpool, or indeed anywhere else, are not just about providing finance, but about stimulating ideas, organisation and co-operation for new initiatives. That is what the Merseyside task force has been doing. There are no easy answers. The hon. Gentleman referred to population losses. I believe that in many ways they show the deep-rooted failure of the city council to address itself to the assistance made available to it by the Government and to tackle sensibly and efficiently the underlying problems that Liverpool faces simply through the decline of industry.
Although there are no quick or easy answers, I have outlined some of the measures that the Government have taken and which I believe are now beginning to show signs of making an impact in restoring confidence. Any alternatives involving greater sums of money would be successful in the long term only if they worked in co-operation with the private sector. The London docklands experience has given much weight to the argument that Government investment in any great city such as Liverpool will benefit the people living there only if the private sector has the confidence to add much larger sums. Newcastle, again, is a good example of the help that such initiatives can provide.
I am afraid that the attitude of Liverpool city council has not been helpful in contributing to and supporting this effort. Unfortunately, its approach has been both narrow and municipal, it has largely ignored the possibilities of the private and voluntary sectors, and it has been very 1123 wasteful of resources. It would have done better to interest itself in developments such as housing co-operatives to ensure that money was spent greatly to the benefit of people living in Liverpool, rather than adopting what I regard as a rather narrow and intransigent approach.
The previous Liberal administration must also take some responsibility for perhaps failing to tackle the inefficient delivery of many basic council services, especially in housing. I hope that the new views which now prevail will assist in that respect.
I am glad that the city has now decided to act sensibly and to set a rate for 1986–87. It is well known that rates are an important factor in determining the location and success of businesses. Rate capping has prevented the worst excesses of profligate authorities, but there can be no place for inefficiency or poor management in the delivery of local authority services in an area fighting for its economic life. Like any other authority, Liverpool must now live within its means if it is to make significant progress towards recovery.
I cannot speculate on which party will take office in Liverpool or who will be leader of the city council after the local elections, but any new council will clearly have a hard task to put right the problems of the past and will face some of the same constraints as the present council. For instance, the rate limit for next year has already been debated and approved by the House. I can say, however, that if there is a change of leadership the Government will look forward to working with a council which has a real desire to make progress in partnership with the Government towards real improvements for the people of the city of Liverpool.
It is untrue to say that the Government do not care about the way in which the people of Liverpool have to live. I believe that much is due to the fact that the city council has brought only financial and economic harm to the city in past years. The Government will certainly find it easier to work with a council which is prepared to use all the available resources to promote the well-being of the city. We have urged that course on the present council, but, alas, to no avail.
Finally, I should like briefly to refer to the positive points that the hon. Gentleman made.
§ Mr. Deputy Speaker
Order. I must remind the Minister that we are now eating into the time allocated for the next debate and taking the time allocated to other hon. Members.
§ Mrs. Rumbold
I am very well aware of that, Mr. Deputy Speaker, and will finish in less than a minute. I accept the hon. Gentleman's positive suggestions about specific areas in which the Government and a responsible city council could encourage the regeneration of the area.