HC Deb 09 January 1990 vol 164 cc838-912

Order for Second Reading read.

4.50 pm
Mr. Speaker

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

Mr. Nicholas Bennett (Pembroke)

On a point of order, Mr. Speaker. It is a separate point of order. Allegations have been made on the Floor of the House. It is a rule of the House that every Member is an hon. Member. I draw your attention to the proceedings of Standing Committee E on 19 December, when my hon. Friend the Parliamentary Under-Secretary of State for Scotland said: Since the hon. Member for Workington (Mr. Campbell-Savours) was clearly referring to me"—[Official Report, Standing Committee E, 19 December 1989; c. 37.]

Mr. Speaker

Order. We have finished with that matter; I have nothing more to say on it. I do not think that there is any profit to be gained for the House in persisting with it. It must be a completely different issue.

Mr. Bennett

It is a matter of principle. If an hon. Member makes allegations about another hon. Member in Committee and those allegations are denied in the record of 19 December, is it in order for an hon. Member to make the same allegations on a subsequent occasion on the Floor of the House when they have been denied by the hon. Member concerned? Is that not tantamount to impugning the honour of the hon. Member and calling him a liar?

Mr. Speaker

What goes on in Standing Committees is a matter for the Chairmen of Standing Committees. We have now disposed of that matter. I call Mr. Secretary Rifkind.

The Secretary of State for Scotland (Mr. Malcolm Rifkind)


Several Hon. Members


Mr. Speaker

Order. We have already disposed of the matter. Today's proceedings have brought no credit upon the House. I ask hon. Members to leave the matter there.

Mr. Bill Walker (Tayside, North)

On a point of order, Mr. Speaker.

Mr. Speaker

Is it a different matter?

Mr. Walker

Mr. Speaker—[Interruption.]

Mr. Speaker

Sit down, please. [Interruption.] I have said that I do not propose to take any further points of order on the previous matter. If the point of order is concerned with this Bill, I will take it. Is it concerned with this Bill?

Mr. Walker

It is a matter of principle.

Mr. Speaker

Order. I am not prepared to take it if it resurrects the previous matter. It must be concerned with this Bill.

Mr. Walker

It is a different matter of principle, Mr. Speaker. I have been attempting to catch your eye for some time on this point of order. It is about hon. Members on Standing Committees or elsewhere. If we are to accept your ruling—I have—no argument with it—that the hon. Member for Workington (Mr. Campbell-Savours) gave his word and made a pledge—

Mr. Speaker

Order. I must ask the hon. Member to sit down. We have dealt with that matter. [Interruption.]

Mr. Walker


Mr. Speaker

Please sit down. I call Mr. Rifkind.

Mr. Walker

On a point of order, Mr. Speaker.

Mr. Speaker

I have told the hon. Member that I am not prepared to take his point of order. I shall be very reluctant to take further action. I ask the hon. Member to resume his seat.

Mr. Walker


Mr. Speaker

I ask the hon. Member to resume his seat. I call Mr. Secretary Rifkind.

Mr. Rifkind


Mr. Walker


Mr. Speaker

Order. I order the hon. Member for Tayside, North (Mr. Walker) to resume his seat. I call Mr. Secretary Rifkind.

4.53 pm
Mr. Rifkind

I beg to move. That the Bill be now read a Second time.

The House will be pleased to be able to consider the more tranquil matter of this Bill, with the major proposals that it incorporates for the Scottish economy. The Bill has been described as perhaps the single most important measure affecting Scotland. [Interruption.] I ask Opposition Members to wait a moment. It has been described not only by me but by the Scottish Trades Union Congress as the single most important measure—[Interruption.] Before he goes too far, I refer the hon. Member for Glasgow, Garscadden (Mr. Dewar) to the remarks of the STUC. It describes the Government's proposals as The most significant institutional reforms within the fields of both training and economic development to be suggested since the establishment of the Manpower Services Commission in 1974 and the Scottish Development Agency in 1975. Therefore, I was modest in my description of the significance of the Bill, because the STUC and its members clearly think that its significance is even greater.

There are three major aspects of the Bill for Scottish Enterprise, any one of which would be of profound importance to the Scottish economy. First, it provides for the combination of the Scottish Development Agency and the Training Commission into a new body to be known as Scottish Enterprise—a powerful body with substantial resources, which will provide an integrated approach of a type that has not been seen before.

Secondly, the Bill provides for the transfer of responsibility for training in Scotland from Sheffield to Edinburgh, and from the Department of Employment to the Scottish Office. Thirdly, it provides for many of the responsibilities that in the past have been carried out by either the SDA or the Training Commission to be delivered in future by new private sector-led enterprise companies in each of the various regions of Scotland, both in lowland Scotland, and, through Highlands and Islands Enterprise, in the Highlands and Islands of Scotland.

Without qualification, any one of the three proposals would amount to a major contribution to the economic future of Scotland. Brought together, they justify the joint judgment of myself and the STUC about their profound significance. They are not only profoundly important. What is significant and, perhaps, unprecedented for such wide-ranging measures is the enormous support that they have received virtually throughout Scotland.

In response to their White Paper, the Government received more than 420 contributions from various organisations, bodies and others concerned with the future of the Scottish economy. Of those 420 responses, no fewer than 403 did not depart from the central recommendations of the White Paper. Only 17 out of 420 disagreed with the basic proposition in the White Paper for the integration of training in the SDA and the creation of Scottish Enterprise.

It is a disappointment but, perhaps, not surprising that in that lonely group of 17 was to be found Her Majesty's Opposition, the Labour party. We have found that, the Labour party, with no significant or noticeable support from any major organisation in Scotland, stands in lonely isolation opposed to the Bill. The hon. Member for Garscadden sits sulking in his tent, without any support from significant bodies in Scotland. [Interruption.] If the hon. Gentleman and his hon. Friends think that 1 am exaggerating, I ask them to reflect on the views of many organisations in Scotland. I shall not refer to all those that might be seen in some way as antipathetic to the views of the Labour party. Let me concentrate on those which are the traditional allies and supporters of the Labour party and which the hon. Member for Garscadden in the past has never hesitated to quote as endorsing his view and welcoming his support.

For example, Mr. Campbell Christie, the general secretary of the STUC, who has not only identified the STUC with the proposals but who was present at the launching of them, said on 31 August last year: First of all can I say that from the trade union movement's point of view we very much welcome the integration of training and economic development as envisaged in 'Scottish Enterprise' and we look forward to the partnership arrangement that the Secretary of State and others have talked about this morning and participating in it. We find that the Scottish Council of Voluntary Organisations notes with approval the remit for Scottish Enterprise and endorses the case … for devolving to a Scottish base the administration of the training and job creation functions … and integrating them with the economic development functions already directed from a Scottish base. The Convention of Scottish Local Authorities said in its response to the Government's proposals: The general objective, set out in the White Paper on Scottish Enterprise, to integrate the Government's support for training and for enterprise creation is welcomed by I he convention. The Church and Nation Committee of the General Assembly of the Church of Scotland stated: The Committee welcomes in broad terms the proposals set out in the Government's White Paper 'Scottish Enterprise' and, in particular, the fact that Scotland is to be given special treatment to suit her own needs. The Committee also welcomes the proposal to bring together training arid enterprise functions which will benefit greatly from being inter-related. In view of the Opposition amendment and the opposition of the hon. Member for Garscadden to the central thrust of our proposals, I challenge the hon. Gentleman to say what support he has from elsewhere in Scotland for the Labour party's lonely position on the measure. I challenge him to name one other organisation of substance or body of importance in Scotland that supports the Opposition's view, which is derived from their narrow partisan position of opposing for its own sake and not on the merits of the proposals.

Mr. Dick Douglas (Dunfermline, West)

The Secretary of State is obviously replying carefully and legalistically to a wide range of arguments. There is great merit in annotating those who support him. if we study carefully the words that people are using to support the legislation, it is clear that they are talking about the interrelationship of the investment and training functions. The danger is that in the Bill those functions are not interrelated, but fused. That is the problem that the Secretary of State, in operation, must address. It is not the interrelationship but the bureaucratic fusion of those functions; it is not only the devolving to Scotland but the local aspects as well.

That is a bureaucratic and operational problem that the Bill does not address. The dangers exist and the Labour party is right to draw attention to the fact that those two functions should be more disinterrelated to avoid the danger of fusion and to benefit the Scottish economy.

Mr. Rifkind

The hon. Gentleman may be describing the position of the Labour party, but I hope that he will have the honesty to admit that that view does not have the support of any other significant organisation in Scotland, on either side of the industrial scene. I note that he accepts that.

It is an unusual phenomenon for the Secretary of State for Scotland, in the present Administration, to be quoting in support of his proposals the STUC, COSLA and the Church and Nation Committee of the General Assembly of the Church of Scotland. I should usually be nervous about support coming from those quarters. I should be grateful to the hon. Gentleman for pledging the Labour party's opposition as that will reassure some of my hon. Friends that the Government are continuing on the right path.

Mr. Donald Dewar (Glasgow, Garscadden)


Mr. Rifkind

I shall happily give way to the hon. Gentleman. I hope that he can tell us who else supports the Labour party's view.

Mr. Dewar

I shall make my own speech in my own time. If the right hon. and learned Gentleman puts such store on the advice given to him by those organisations, why has he accepted their general blessing but repudiated almost every one of the specific pieces of advice that they have given him?

Mr. Rifkind

That simply is not true. There have been a number of extremely useful contributions and suggestions from the STUC, COSLA and other organisations, some of which we have accepted. I have not the slightest doubt that, as the Bill is debated in the weeks to come, there will be constructive suggestions from a variety of organisations. I hope that the Labour party will be included in them. If it moves away from its emotional, pigheaded reaction to measures and its partisan political view, and instead addresses the contents of the Bill, I have no doubt that the consensus that currently includes the rest of Scotland might be extended also to include the Labour party.

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

I wish to ask a question relating to clause 1(b), which talks of a body to be known as Highlands and Islands Enterprise, which shall have the general functions of preparing, concerting, promoting, assisting and undertaking measures for the economic and social development of the Highlands and Islands. Where does the tourist industry stand with regard to that part of the clause? The right hon. and learned Gentleman will recall that the Select Committee on Trade and Industry called for a United Kingdom body for the tourist industry. Will he assure the House that, under the Bill, the Scottish tourist industry and board will remain autonomous bodies for the next two years?

Mr. Rifkind

I very much hope that they will remain autonomous bodies for longer than that. The Government have no proposals to limit the autonomy of the Scottish Tourist Board. The Bill will not have any effect on that matter.

The central thrust of the Bill is the integration of training and the Scottish Development Agency into a new body to be called Scottish Enterprise. I shall explain why the Government and a wide spectrum of Scottish opinion believe that to be highly desirable. The first and most obvious reason—and one that industry has pointed to—is the desirability of a single door for industry with regard to business support and training. It is always easier and more simple for those who are to benefit from the support that is given by Government if they can go to a single organisation or body to identify what is available and come to a conclusion as to the extent that such a body can assist with their economic opportunities. The integration of the two organisations has much to commend it, rather than a continuation of parallel organisations each seeking to help industry in a different but interrelated way.

Secondly, it is wrong to imply that training is other than another form of investment. Training is a form of investment and, in that sense, is similar to the general work that the Scottish Development Agency and the Highlands and Islands Development Board have done for a number of years. If we wish to continue the strategic involvement of such an organisation, working with the Scottish Office, to carry out its duties, those matters should operate in an integrated way. It is that integration that has been most commended by all the organisations that I have mentioned and also by the CBI in Scotland, the Scottish Council (Development and Industry), Scottish Business in the Community and various other organisations.

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

Will my right hon. Friend—[Interruption.] Does the right hon. and learned Gentleman agree that the infrastructure, particularly transport services, is vital for industrial development? He may be aware of the distressing news today that British Rail plans to discontinue direct services from Stranraer via Girvan and Ayr to the south of England. That will cause great harm and difficulties for industrialists not only in my constituency but in the constituencies of the right hon. Member for Ayr (Mr. Younger) and the Minister of State, the hon. Member for Galloway and Upper Nithsdale (Mr. Lang). My colleagues and myself, along with some Conservative Members, will be meeting British Rail officials next week to ask them to reconsider the matter. Will the Secretary of State join us in that campaign to persuade British Rail to reconsider that unwise decision that will be detrimental to industrial development in the south-west of Scotland?

Mr. Rifkind

My friendship with the hon. Gentleman goes back 20 years and I take no offence at his initial form of address. We are all disappointed by any proposal to limit or reduce British Rail services in any part of Scotland. There will be an opportunity for the reasons that British Rail has put forward to be considered and for a conclusion to be reached on whether they have substance. There will also be opportunities for comments and representations to be made to British Rail. The announcement was made only today, and it is clearly necessary for the ideas behind it to be properly examined.

The thrust of the proposals is the integration of the SDA and training. I have given the reasons why, in my view and the view of virtually all those who have commented on it apart from the Opposition, the integration of the SDA and training makes great sense.

The second main ingredient is the transfer of responsibility for training from Sheffield to Edinburgh and from the Department of Employment to the Scottish Office. It is a profound change because it involves the transfer not only of policy responsibility, but of the resources that have previously been the responsibility of the Department of Employment. That is of great significance. The need for it flows from several different reasons. First, if there is an integrated body called Scottish Enterprise, through which new enterprise companies are to be established, it obviously makes sense for those companies to be answerable to one line of response and to one Government Department. To have a split of responsibility in an integrated body answering to two Government Departments simultaneously would not have made sense or have been wise. Therefore, the Government came to the conclusion, which has been well received, that this is a sensible change.

In addition, it is a Scottish solution to meet Scottish needs. The Scottish Development Agency has no exact parallel south of the border. If it is to continue with its important role of business support, environmental improvement and other works—it is the Government's intention that it should—it is sensible and desirable that that economic activity should be linked to the work of the Training Agency in Scotland, which is comparable and interrelated. Therefore, it makes sense that the Scottish Office, which is already an industrial and economic Department, should have an enhanced role.

Mr. Tony Worthington (Clydebank and Milngavie)

The Secretary of State referred to the transfer of control for training to Edinburgh. Do the provisions mean that the Secretary of State will be able to give up the employment training scheme unilaterally?

Mr. Rifkind

I made it clear at the beginning of the debate that it is in the interests of youngsters and others in Scotland that the qualifications that they obtain should help them to gain employment either in Scotland or elsewhere in the United Kingdom. The same applies to my colleagues in the Department of Employment, the Welsh Office and the Northern Ireland Office.

In response to the hon. Gentleman's specific point, the Government have a United Kingdom training policy—of that there can be no doubt. Indeed, it is something of which Her Majesty's Opposition also approve. In the unlikely event of my wishing to promote completely different training policies in Scotland from those applied elsewhere in the kingdom, it would obviously be necessary for me to get the approval of my colleagues before moving in that direction. That goes for any Department at any time. However, I cannot think of a more undesirable course on which to embark. It would mean that the qualifications of youngsters in Scotland would be of little help to them in obtaining employment in other parts of the kingdom.

Mr. John McAllion (Dundee, East)


Mr. Rifkind

Perhaps I may finish this point. 1t is important that the training policy should be applied with sufficient local flexibility and sensitivity and I am grateful to the hon. Member for Clydebank and Milngavie (Mr. Worthington) for leading me on to the third major ingredient of this part of the Bill.

I should have thought that Her Majesty's Opposition, with their professed belief in decentralisation and devolution, would enthusiastically endorse the creation of enterprise companies instead of carping and criticising. For the first time, we shall have the opportunity to create in each region of Scotland enterprise companies that will have the responsibility for delivering not only the training responsibilities of the Training Agency in Scotland, but much of the business support responsibilities of the Scottish Development Agency and the Highlands and Islands Development Board. In delivering those local services, we envisage significant flexibility that will enable those companies to adapt to the way in which such policies are implemented, in response to the needs of the locality.

Mr. Archy Kirkwood (Roxburgh and Berwickshire)

On the Secretary of State's point about decentralising local enterprise companies, we in the rural areas of Scotland have some legitimate concerns because the present provisions have guaranteed a relatively stable and systematic standard throughout Scotland, which has served the rural areas just as well as the urban areas. Although I understand that the problems in urban areas can sometimes be greater, I am concerned about the demands and requirements that will be placed on those who are expected to participate in the local enterprise companies in rural areas. Those people will have to travel long distances for little reward, which is asking a great deal unless the Government can come up with real resources and a real package of support to make it worth while for local business men to become involved in rural areas.

Mr. Rifkind

With all due respect, I advise the hon. Gentleman to contact the enterprise trusts and business community in his constituency and in his own part of Scotland. If he does, he will find that there is already enormous interest from the rural areas in Scotland. There is not the slightest sign of any lack of response. Quite the opposite—the Government have been enormously delighted not only by the number of people coming forward, but by the calibre of those wishing to be identified with enterprise companies. That applies in the rural areas as well as in the more industrial parts of Scotland. We can already say with confidence that attracting people of calibre in sufficient numbers to carry out the responsibilities of the enterprise companies will not be a problem. Indeed, far more such people are already coming forward than can be accommodated within the framework of the proposals.

Mr. Alistair Darling (Edinburgh, Central)


Mr. Rifkind

If the hon. Gentleman will allow me to continue for a little while, I am sure that I shall find it possible to give way to him in due course. I wish to get on with my speech because I can see that many hon. Members wish to take part in the debate—

Dr. Jeremy Bray (Motherwell, South)


Mr. Rifkind

Very well, I give way to the hon. Member for Motherwell, South (Dr. Bray).

Dr. Bray

Although the point about local participation may be impressive in principle, is the Secretary of State aware that there is a great variation in the quality of people coming forward in the different industrial areas? In Lanarkshire, for instance, the biggest employer, British Steel, is not taking part and another major international company has nominated its property manager. Generally, Lanarkshire will not have a first division board.

Mr. Rifkind

The hon. Gentleman must be responsible for his own comments on that. The people who have been mentioned to me as being interested in taking part in Lanarkshire and in other areas include a number of important persons within the local economy. However, the hon. Gentleman is entitled to his own view.

The importance of the enterprise companies flows from the following facts. First, when training was introduced some years ago in the early 1980s, it was at a time of mass unemployment and inevitably the method of training that was applied was relatively unsophisticated. Over the years, the training has become more sophisticated, and with falling unemployment those who are seeking and obtaining training, whether they be youngsters or older persons, are in a much stronger position to obtain employment thereafter. With the demographic changes that are already taking place in Scotland, which will lead to a massive reduction in the number of school leavers in the next few years, the need to have a training system and a business support system that is more tailored to the requirements of each locality in Scotland is greater than ever.

The simple fact is that the economic, training and business support needs of the north-east of Scotland are not necessarily the same as those of Glasgow. The needs of Edinburgh are not necessarily the same as those of Dumfries and Galloway, and those of the Borders are not necessarily the same as those of Lanarkshire or Dumbarton. Only by a system of effective decentralisation can one hope to meet such requirements.

Mr. Darling


Mr. Rifkind

Perhaps I may continue this point. It is of great significance that the Scottish Development Agency was already in the process—it has been doing this for some time—time—of decentralising to its own employees in various parts of Scotland the administrative responsibility for implementing a number of the schemes for which it is responsible. We are taking that process an important stage further and devolving and decentralising responsibility not simply to the officials of the SDA, but to the local community—primarily to the local business and industrial community, but also to those from other sections of the community who have an interest in the economic development of the locality. That is profoundly different from what we have ever had in Scotland. It has been widely welcomed by both sides of industry and I repeat that it is a matter of great sadness that, for reasons that have not yet been properly articulated, the Labour party seems unable to identify with the view that is so widely held.

Mr. Darling

I am grateful to the Secretary of State for giving way. Perhaps I can tell him why there is some concern. I am all in favour of decentralisation, but I am not in favour of decentralising decision-making to one narrow category of people such as business men. The old town of Edinburgh has been targeted by the SDA, mainly because it wants to see more tourism there. However, people living in the old town are concerned that, through the local boards, business men may identify gap sites from which they individually and their companies could profit, and those business men may then use the umbrella of the power and prestige of their enterprise boards to acquire and free that land and then, lo and behold, their own companies may buy up the land and make a profit from it. My fear is that the boards could be used as stalking horses for individual business men because there is no countervailing balance provided by the local community to any meaningful extent.

Mr. Rifkind

Those are interesting points. However, the hon. Gentleman's proper response should be the more constructive approach of the STUC, COSLA and others who have commented on these matters. Some of them have expressed similar concerns to those of the hon. Gentleman, but that has not stopped them welcoming the broad thrust of the Bill. They have said that they welcome the thrust of what the Government are doing, although that could be improved in certain ways, but irrespective of whether it is improved, it is far better to have the Bill in its present form than not at all. That is the fundamental difference between the Labour party and the rest of Scotland on the issue. The Labour party would be well advised to raise those matters of detailed concern as the Bill goes through the House. Scottish opinion finds it difficult to understand why those are being used as a perceived justification for opposition to all the proposals.

Sir Nicholas Fairbairn (Perth and Kinross)

My right hon. and learned Friend might observe to the hon. Member for Edinburgh, Central (Mr. Darling) that the new town of Edinburgh was built by the enlightenment of business men and its prosperity lies on it.

Mr. Rifkind

My hon. and learned Friend is entirely correct and the inheritance that enterprise has given to the modern grandeurs of Scotland can hardly be exaggerated.

I have commented primarily on the position in Scotland as a whole. However, the position in the Highlands and Islands is comparable and there has been a great welcome for the Government's proposals throughout the Highlands and Islands. In our consultative document we put various proposals to Highlands and Islands opinion, including a continuation of the status quo or the proposals now referred to as Highlands and Islands Enterprise. It was clear that the overwhelming weight of opinion supported the proposal for an integrated approach, giving to the successor body to the Highlands and Islands Development Board comparable powers to those exercised by Scottish Enterprise.

In putting forward the proposals, we do not wish to imply any criticism of the SDA or the HIDB. I say without qualification that their role and contribution to Scotland during the past years since their creation has been of profound significance and importance. The HIDB—which this year celebrates its 25th aniversary—has operated through a period of profound change to the well-being of the Highlands. When we think of the history of depopulation in the Highlands, it is of enormous encouragement that since 1971 the population of the Highlands and Islands has increased by 25,000, or 8 per cent. The HIDB is entitled to credit in contributing towards that.

Mr. Alex Salmond (Banff and Buchan)

Will the Secretary of State confirm that his endorsement of the past record of the Scottish Development Agency is not shared by the progenitor of the Scottish Enterprise scheme, Mr. Bill Hughes, the vice-chairman of the Scottish Conservative party, who has made some sweeping attacks on the performance of the Scottish Development Agency?

Mr. Rifkind

Bill Hughes is perfectly able to speak for himself, but at least he has remained in the Conservative party, unlike some of those in the Scottish National party who take a different view from the hon. Member for Banff and Buchan (Mr. Salmond).

The Government's views are quite simple: the SDA, particularly with the changes introduced to its powers after 1979, has made a sterling contribution to Scotland's well-being, which is why combining the SDA's present responsibilities with those of the Training Agency will strengthen its future contribution. I say categorically—because this is a matter that has given rise to some concern —that we have every intention that the SDA will continue with its strategic responsibilities to the wider Scottish economy. There is to be no change to inward investment as a result of the proposals and Locate in Scotland will continue, as at present, to co-ordinate with the Industry Department for Scotland and Scottish Enterprise.

Mr. George Robertson (Hamilton)

The Secretary of State referred to the value of the Scottish Development Agency. I served as a board member of the SDA in its initial period. It has had 14 years to build up considerable success. The SDA has a good track record and an identifiable image. Why has the Secretary of State resisted the advice given by all the organisations that he has prayed in aid in his speech and decided that the name, Scottish Development Agency, should now disappear?

Mr. Rifkind

The SDA made it clear that it did not take any exception to the proposed name, Scottish Enterprise. If we create a new body, combining two quite separate organisations to come into existence at a time when enterprise companies are also being created with a profoundly new role to play, this constitutes a new start. There is no question about that and the SDA has been the first to acknowledge it. 1 do not attach enormous importance to nomenclature. When we have a new organisation with new powers and responsibilities, it makes sense to reflect that in the organisation's title. I was pleased that in its representations the SDA made it clear that it had no objection to that proposal.

Part I of the Bill deals with Scottish Enterprise and Highlands and Islands Enterprise. Clause I establishes the two bodies and gives them general functions in economic development, environmental improvement, training, and, in the case of Highlands and Islands Enterprise, social development. It also gives effect to schedule 1 which provides for the constitutions, proceedings and staffing of the two bodies. Clause 2 enlarges on their training functions, while clauses 3 and 4 make further provision as to the functions for the two bodies. Clauses 5 and 6 make particular provision for the two bodies' functions for the improvement of the environment and derelict land.

Clauses 7 to 13 provide for the powers that the two bodies may exercise in carrying out their functions. As I have said, they include the full powers of their predecessors. Restrictions on some of those powers are set out in clause 12: again, the restrictions are no greater than those which were placed on the predecessor bodies. Clause 13 enables me to give the two bodies directions, following consultations with them. Clauses 14, 15 and 16 make various provisions with regard to the two bodies' training functions. They cover such matters as payments equivalent to industrial injuries benefit in approximate cases, the treatment of disabled ex-service men and women, and the prevention of sexual or racial discrimination.

Clause 17 allows the two bodies to delegate their functions and powers to others. It will be principally through this provision that local enterprise companies will be able to carry out functions under contract to the two bodies. Certain functions and powers are excluded from delegation. The hon. Member for Clydebank and Milngavie might now have read the Bill, compared to when he made his previous comments, and if so he will realise that the powers of delegation do not include compulsory acquisition of, and entry to, land and powers to obtain information. Clause 18 allows local authorities and new town development corporations to act as agents for the two bodies.

Clause 19 defines the two bodies' areas of operation and clauses 20 and 21, together with schedule 3, make provision for the transfer of property, rights and liabilities to the two bodies from their predecessors. Clauses 22, 23 and 24 make provision for the financing of the two bodies.

Mr. Worthington

I concede that derelict land is excluded from delegated powers. However, I made another point about planning permission, which is referred to in clause 5. Under the Bill, that is not excluded.

Mr. Rifkind

Enterprise companies will not be public bodies. They will be private sector companies, with the same legal position as any other such company. It flows from that that they can have no involvement in the planning process, any more than any other planning application. If the hon. Gentleman will not accept my word for it, perhaps he will accept the advice that he is clearly now receiving from the hon. Member for Garscadden, which I suspect is identical in content arid conclusion as mine.

Mr. Dewar

But I draw a different conclusion.

Mr. Rifkind

I look forward to the interpretation of the hon. Member for Garscadden in due course.

Clauses 25 and 26 make provisions concerning the two bodies' powers of entry on to Crown land and the service of documents. Clause 27 provides for the two bodies to furnish the Secretary of State with accounts and annual reports, and for the statements of account to be examined and certified by the Comptroller and Auditor General before being laid before Parliament. Clause 28 restricts Scottish Enterprise's involvement with the media industry, while enabling it to advertise in connection with its investment functions without requiring authorisation under the Financial Services Act 1986. Finally, clause 29 makes provision for the registration of agreements made by the two bodies with landowners.

Let me deal now with provisions in the Bill for the Scottish new town development corporations. As the House is well aware, there are five new towns in Scotland and the oldest, East Kilbride, was designated in 1947, and the youngest, Irvine, in 1966. The main objectives in creating them were to assist the dispersal of industry and population from overcrowded inner-city areas, especially Glasgow, and to provide locations for economic expansion.

Development corporations have provided good quality housing and new industrial infrastructure for post-war Britain and have encouraged economic and environmental development. Scottish new town residents have responded well to changing technology, demonstrating their flexibility and capacity to adapt to the needs of the market place. Firms that have set up in the new towns have grown and prospered. The Scottish new towns continue to make a contribution to the economic and social well-being of Scotland and the United Kingdom.

The aim of the New Towns Act 1946 was to attain thriving, balanced communities that would ultimately be able to stand on their own feet, and be treated in the same way and have the same status as any other town. The Bill is necessary to bring the new town programme in Scotland to its completion. The Government have always made it clear that new towns should not continue to be distinguished from other towns by the perpetual presence of special public sector support and our policy will enable the new towns to become self-sufficient communities.

Our proposals, on which we have consulted at length and in considerable detail, are similar to the arrangments that have operated for the English new towns, but there are significant differences. For example, we have concluded against having a residuary body for Scotland, but there is scope under the proposals for the transfer of corporation assets to a range of bodies, including Scottish Enterprise and Scottish Homes, to the extent that the assets have not already been disposed of to other parties before dissolution of the corporations takes place.

The present statutory provisions governing the transfer of corporation undertakings and their wind-up and dissolution are contained in sections 35 and 36 of the New Towns (Scotland) Act 1968, but they are inadequate and out of date. New provision is required and I shall now describe briefly the relevant provisions in the Bill.

Mr. Tam Dalyell (Linlithgow)

My hon. Friend the Member for Livingston (Mr. Cook) is a member of the Standing Committee considering the National Health Service and Community Care Bill. Who will do the valuations of the properties, and how will the Property Services Agency fit into the new schemes of Scottish Enterprise?

Mr. Rifkind

The corporations have traditionally been responsible for their own valuations and that may be an appropriate way of dealing with the matter. But there are recognised and well-established procedures for the valuation of public sector assets.

On the relationship between new towns and Scottish Enterprise, as the hon. Gentleman will be aware, there are proposals for the creation—

Mr. Dalyell

I asked about the relationship between the Property Services Agency and property holdings and the new Scottish Enterpise. I asked that partly because, with my hon. Friend the Member for Dumbarton (Mr. McFall), I am involved in considering the Property Services Agency and Crown Suppliers Bill in Committee.

Mr. Rifkind

I am grateful to the hon. Gentleman for clarifying the question, but I am not sure that I can clarify the answer. If the hon. Gentleman will allow me, I shall have the matter involving the PSA looked into and my hon. Friend the Minister of State may be able to deal with it when he replies.

Clause 30 amends the provisions in sections 36 and 36A of the New Towns (Scotland) Act 1968 relating to the procedures for the wind-up and dissolution of the development corporations. It also provides for individual wind-up orders to be made, allowing maximum flexibility in determining when a development corporation should begin the wind-up process. It extends the scope for development corporations to dispose of their property, rights and liabilities and provides for their transfer after a wind-up order has been made. It also empowers the Secretary of State to relieve, by making grants, any financial burden that is imposed by the transfer of corporations' property.

The Bill also contains new financial provisions affecting the development corporations. The new town development corporations have always been financed mainly by borrowing. The original expectation was that corporations would incur revenue deficits in their early years, which would be met by borrowing. It was also expected that development of the new towns would create sufficient surplus in time to repay that borrowing. Those assumptions were largely fulfilled for the first generation of new towns. However, it became evident in the early 1980s that in general they would be unlikely ever to generate sufficient surpluses to service and repay their accumulated debt. To remedy that, the Government in 1985 took powers in England and Wales under the New Towns and Urban Development Corporations Act to carry out a reconstruction of the debt of the English and Welsh new towns. That Act also introduced new financial arrangements in the form of grant for the provision of facilities that could not be expected to pay for themselves. Therefore, clause 31 provides for financial reconstruction of the Scottish corporations, and clause 32 provides for the payment of grant to meet the cost of essential infrastructure provisions that cannot be financed by borrowing.

Clauses 33 to 37, and schedules 4 and 5 to which they give effect, contain the necessary supplementary, miscellaneous and general provisions of the Bill.

In conclusion, let me comment on the local enterprise companies to which I referred. They are crucial to the proposals that are before the House and we have been enormously encouraged by the enthusiastic response that has already made itself known throughout Scotland. Already we have 11 applications from the lowlands of Scotland and a further six from the Highlands and Islands, and I understand that in every other part of Scotland proposals for consortia, which will be put to the Government, are already at an advanced stage of preparation.

Mr. Kirkwood

I am grateful to the Secretary of State for allowing me to intervene a second time, but why was the opportunity not taken to impose a social as well as an economic requirement on the new local enterprise companies operating outside the old Highlands and Islands Development Board area? As the House knows, a social requirement has been imposed on the Highlands area, but there is still no social requirement south of the Highlands and Islands.

Mr. Rifkind

We have replicated the traditional role of the Highlands and Islands Development Board. The fact that the Scottish Development Agency, when it was created in 1975, was not given a social role, unlike the HIDB, was the result of a recognition at that time, which is still relevant, that the particular needs of the Highlands and Islands are distinct from the rest of Scotland. That is reflected in the current legislation.

It is important to remember that the local enterprise companies can be established without the need for primary legislation. They are private sector companies that do not require statute, so they can come into existence at any time. If, as we expect, they come into existence over the next few months, any contractual relationship that they enter into will be not with Scottish Enterprise, which will not yet have come into existence, but with the Scottish Development Agency and the Training Agency in the first instance, but that will be temporary.

Mr. Ernie Ross (Dundee, West)

Will the Secretary of State explain the difference between the arrangements in Scotland and those in England and Wales? He will know that the initial impetus for the change in the delivery of training came from the experience in the United States. He will also know that in England and Wales the Secretary of State for Employment is imposing performance contracts on each training and enterprise council. A performance contract will require a guaranteed placement of trainees before payment is made. Will those same performance contracts be imposed by local enterprise companies on providers of training?

Mr. Rifkind

I advise the hon. Gentleman not to exaggerate the relevance of the experience of the United States to the proposals. Naturally, one is interested in the experience of any part of the world, but essentially we have been influenced by the needs of the Scottish economy and our perception of what would be most appropriate and relevant to the Scottish requirement.

The hon. Gentleman asked about a comparison with TECs in England. There are some similarities, but the differences are even more profound. The role of the enterprise companies will be far wider than those of TECs in England, which will be restricted to training. In Scotland, enterprise companies will also have the significant role of business support and development, representing some 80 per cent. of the projects presently carried out by the Scottish Development Agency. In addition to that, there is no counterpart to Scottish Enterprise. Essentially, the relationship will be contractual and it will be necessary over the next few months to work out the precise details of how that contractual relationship will operate. In many respects, it may be similar to that in England and Wales, but not necessarily so. It will be accommodated to meet the specific requirements in the various parts of Scotland.

Mr. Adam Ingram (East Kilbride)

Will the Secretary of State confirm that he intends to set a maximum number of 12 persons to serve on each local enterprise board? Only four of those places will be allocated to local authorities. Lanarkshire has five district councils, as well as Strathclyde regional council, covered by one local enterprise board. Will the Secretary of State further confirm that he has instructed the managing director of East Kilbride development corporation to serve as a public sector representative on that board? If that is so, how can all those local authorities make an input into the running of the local enterprise company in Lanarkshire?

Mr. Rifkind

The hon. Gentleman seems to be suggesting that we have instructed the general manager of East Kilbride development corporation, but that is not so. The Secretary of State will have no power to determine who serves a local enterprise company. I repeat that local enterprise companies will be private sector companies, and nothing in the Bill or in any other provision enables the Government to determine their composition. We have said that we shall be prepared to enter into contractual relations with enterprise companies that are private sector-led, with broadly the proportion of private sector involvement of the type that has been mentioned. However, we shall not be identifying precisely the individuals who should serve on enterprise boards or in enterprise companies—other than in Scottish Enterprise itself.

Several Hon. Members


Mr. Rifkind

I have given way many times during my remarks, but I shall not do so again as I know that other hon. Members wish to participate.

The central theme of the Bill is a devolution—if one wishes to use that word—or a decentralisation of responsibility from Sheffield to Edinburgh, from the Department of Employment to the Scottish Office, and from the centre of Scotland to each of its regions and local communities. It is one of the great ironies that the Labour party has for the past few years been droning on about its belief in the principle of devolution and decentralisation but is now presenting itself as the only body of significance in Scotland that opposes a Bill that provides for major decentralisation and devolution of power both to Scotland and within Scotland.

The hon. Member for Garscadden may tell the House that he is opposed not to the Bill's broad principles but to its detail—and the hon. Member for Fife, Central (Mr. McLeish) nods his head vigorously. The hon. Member for Garscadden has long been a Member of Parliament and will be aware, even if the hon. Member for Fife, Central is not, that if one supports the broad principles of a Bill but disagrees with its details, one does not oppose it on Second Reading but seeks to amend it during the later stages of its progress through the House. That is the view taken by others in Scotland who have some reservations about the detail of the Bill.

I say in a spirit of friendliness to the hon. Member for Garscadden that in recent weeks he has been very critical of the Scottish National party for seeming to ignore, for narrow reasons of party political advantage, real Scottish interests. The hon. Member for Garscadden has warned and advised, with all the authority that he can muster, that political parties that seek to give prominence to narrow partisan advantage rather than to identify wider Scottish interests are doomed to failure, rejection and contempt.

I repeat that the hon. Member for Garscadden cannot call on his traditional friends and allies for support. He cannot call on the trade unions, local authorities, or even the Committee on Church and Nation—which must make him, on this issue if not on others, one of the loneliest men in Scotland. Knowing him to be a man whose nature is of the essence sweet, reasonable and conciliatory, I have no doubt that after due consideration, and after examining all the pluses and minuses, and subject to all the necessary reservations, caveats and recommendations, the hon. Member for Garscadden will end up endorsing the Bill. If he does not, he will be repudiating the interests of the people of Scotland and something that the whole of Scotland is anxious to see implemented as soon as possible.

5.54 pm
Mr. Donald Dewar (Glasgow, Garscadden)

I beg to move, to leave out from "That" to the end of the Question and to insert instead thereof: This House declines to give a Second Reading to the Enterprise and New Towns (Scotland) Bill because it fails to provide the right framework for rebuilding the Scottish economy and to make proper provision for a true partnership between the private sector, local authorities, trade unions and the wider community and threatens the central strengths of the Scottish Development Agency and the Highlands and Islands Development Board; and because it fails to guarantee the financial support required for economic resurgence and to ensure that control of training policy is given to Scotland; deplores the absence of any guarantee that when New Town Development Corporations are wound up, tenants will have the choice of landlord and tenure that they want; fears the loss of the momentum generated by the Corporations; and believes that the interests of the residents will not be put first in the disposal of New Town assets. Apparently I have entered the Chamber naked, at least in the mind of the Secretary of State for Scotland. I suppose that I ought to be grateful that at least he did not descend to describing me as an honest politician, which he does when in a particularly uncharitable mood. I unrepentingly move the reasoned amendment in my name and the names of my right hon. and hon. Friends. It is a little harsh of the Secretary of State to describe me as being harsh and pigheaded, and as someone who spends most of his time sulking in a tent. My commitment to the open air life certainly does not run to an enthusiasm for tents.

I accept of course that enterprise and new towns have a number of factors in common. One of them is their rather unlikely linking in the Bill, which raises for both rather more questions than it answers. The Bill blissfully disposes of new towns in three clauses that are tagged to the end of it. They deal with winding up and disposal in a brief outline of statutory powers and enabling legislation which advances very little the knowledge of those whose lives are tied up in the new towns, and which offers little more than "The Scottish New Towns: The Way Ahead", which was published last July. The Secretary of State must be aware that that document gave rise to many fears and questions.

The legislation is an anticlimax in respect of new towns, which attaches special significance to the Committee stage —when I hope that Ministers will be a great deal more forthcoming about the way in which winding-up will be effected and the disposal of assets tackled. I accept that winding-up must come. We have always accepted that new towns were there to do a job and that at some point they would form part of the normal administration in Scotland. I pay tribute to the development corporations, to their staff, and above all to the people living in new towns. The vitality and drive that they contribute have undoubtedly made new towns a significant success story.

In Committee, we shall want to probe several matters of concern in the minds of almost everyone in Scotland, including the district councils within which new towns are contained, those involved with the development corporations, and those living in the new towns themselves. One concern is how the new towns will be able to maintain their economic momentum during the winding-up period. We shall want to know more about the role of the local enterprise companies, which we are told will be profit driven and have a normal share structure, articles of association, and a board of directors.

The company will be a normal commercial animal, yet it will inherit a residue of public functions during an important but perhaps destabilised period. We shall want to know more about the relationship between Scottish Enterprise and the companies that will operate in each new town area, local authorities, and the local development boards. There will be a complex mosaic of interlocking responsibilities, and having examined the Bill and the other documentation that has been presented, I have reached the conclusion that a great deal more information must be produced before the House should be asked to put the Bill on to the statute book.

We want to know on what basis assets which, as every right hon. and hon. Member knows, have been generated and developed in the public sector will be valued and sold. We do not want to find that the public sector or even the local development corporation is left with an unattractive residue that it cannot flog off at some figure to other parts of the commercial world. We want to know much more than is revealed by the bare bones of the Bill.

The final point, and I apologise that I have had to make these remarks fairly quickly, is one that the Secretary of State knows balks large in the debate in the new towns at the moment—the future of the housing stock. I do not want to be unfair, and I accept that the Bill does not rule out the possibility of a wide range of choice to individual tenants at the time of winding up. There are saving references to local authorities, but I hope that there will be rather more than that. There are also references to a number of other organisations and possible recipients of the new towns' assets and the housing stock.

In Committee we shall want to convince the Government that they must go considerably further, and that they must give a full range of choice to individual tenants before, and at the point, of winding-up.

The Minister must be aware that in almost every test of public opinion, and in every investigation carried out by opinion polls, whether they are organised by a new town corporation such as East Kilbride or by the Government, it is clear that there is at least a significant block of tenants in the new towns who are interested in becoming district council tenants when they have to make a choice. In East Kilbride some 70 per cent. showed that preference. In the Government's inquiry, when asked what they would like now, 63 per cent. of tenants opted for the district council, and when they were asked the more hypothetical question of what they would opt for at the time of winding up, the figure dropped to 47 per cent. That may represent a significant shift in opinion, but it still represents a massive number of people whose choice must be respected. Compare that with the preference for Scottish Homes which some 4 to 5 per cent. opted for, or for private landlords, which only 1 per cent., dropping to something unquantifiable, opted for, and one begins to see that it is important that we make provision for a transfer to district councils, as that is the choice of the individual tenants.

It makes a mockery of choice if it exists only if it is exercised as the Secretary of State wishes. The range of options must be comprehensive. I hope that I am giving the Secretary of State fair notice that we shall return to this subject in Committee with energy and persistence.

I do not think that the Secretary of State will object to my quoting one other opinion outwith the Labour party or the new towns themselves, as I think that it is fairly representative. I know of no evidence to show that any organisation does not back my basic case at the moment. I shall quote the Scottish Consumer Council's view on the subject. Peter Gibson, its director, says: It would be a surprising vote of no confidence in the attractiveness to tenants of potential new landlords, whether housing associations, co-ops, building societies or new housing trusts set up by development corporation employees, if the government were not to allow district councils to compete on equal terms. That is a fair way of putting it, and it is in the language of the new Conservative party, and it will no doubt appeal to the hon. Member for Stirling (Mr. Forsyth) who is so influential in the counsels of the Scottish Office. I hope that we shall have no trouble and that in Committee we will find that we are pushing at an open door.

There is largely a deafening silence in the Bill on the subject of Scottish Enterprise and Highlands and Islands Enterprise. The Bill says absolutely nothing about the local enterprise companies. I recognise that the Secretary of State said that they do not need a statutory base, but, as he has described them as the heart of the matter, lying at the centre of the scheme, it makes it more difficult to take a balanced look at Scottish Enterprise or Highlands and Islands Enterprise. That is particularly puzzling to me, because I had an exchange with the hon. Member for Stirling recently on television, in which I predicted that there would be problems controlling the enterprise companies' budgets because of the balance of power between Scottish Enterprise and the constituent companies operating in the area. I was told, in a very nebby way by the Secretary of State, who sounded just like an Edinburgh advocate patronising a Glasgow solicitor, that I clearly had not read the Bill. I have read it with enormous care, but I have found no word, or scrape of the pen, about those issues. I wish that he would be more accurate with his abuse in future, and not put us in this difficult position.

I recognise that the Government were running hard to catch up with what was already happening when they drafted the Bill. The lack of available information reinforces the impression of muddle and confusion and I believe that a sense of direction is lacking. As I have said consistently from the beginning of this debate, we are not convinced about the structure that the Government are commending in Scottish Enterprise. We welcome unreservedly the fact that there should be a Scottish training agency—I will return to its powers in a moment —but we are not convinced that it has to be behind one door of the Scottish Development Agency. Of course there are links, there has to be interaction and co-operation—I concede that—but it need not necessarily be with the same management structure.

Let us consider the SDA and the HIDB. They have succeeded because they are tight, professional organisations with short lines of communication and with an integrated operation from the top to the bottom. They are the opposite of what is now being proposed in many ways. Those enterprise functions—the supporting of excellence, the use of pump priming funds from the public purse—and all the work of business advice and promotion with which the SDA and the HIDB are associated are very important, but I do not think that they require the same sort o management structure as that needed to organise the hundreds of outlets that provide on-the-ground training., whether employment training, the youth training scheme or some other form. That is not necessarily a happy marriage.

I remember that the Secretary of State said in a Scottish Grand Committee debate that, of course there would have to be a compromise. The structure that he again referred to today that the SDA has evolved for its own purposes and its present range of responsibilities will be torn up and another substituted. That shows that, given its traditional role, it is not only a compromise but one that it would not have wanted.

I am not ashamed to stand alone on this issue, although I do not think that I do. I accept that the weight of institutional response probably welcomes the present proposals more than I do. I do not know why the Secretary of State should think that it is dishonourable to stand and argue for what is right—he has made a lifetime career of it. I find it extraordinary.

My impression is that much of the support started with a nod to the general structure but, when one reads the documents, one discovers that that support was heavily qualified. At times it has broken into private grief. Peter Carmichael is one man who speaks for many people in the SDA and he is an interesting witness. In the Glasgow Herald on July 14 last year, Dr. Carmichael, who is the ex-director of the SDA in Scotland, talked about the break-up of the Scottish Development Agency and the weakening of an organisation dedicated to help Scotland expand its economy. He went on: I fear for any real strategic business development in Scotland at the national level". He may have put it in somewhat populist terms in that article, but I believe that he reflected the genuine private unhappiness that anyone who has talked to those involved during the past few months will be aware of.

I admit that this is anecdotal, but the Glasgow Herald of 30 October carried a report that emanated from the international forum held by the Scottish Council (Development and Industry). The article said that the area away from the forum floor was buzzing with comment and that reflected a powerful unofficial agenda and widespread concern that the planned changes would damage Scotland's present development, and usher in a system that is incapable of delivering what is promised for it. That is my experience: when people are pushed into corners and asked what they really think, the doubts start to emerge in a pronounced and urgent fashion.

Mr. Rifkind

The response that is already emerging from people anxious to play a part in the proposed consortia belies the hon. Gentleman's analysis. I hope that at some stage he will tell us whether the Opposition believe in decentralising major powers to enterprise companies. I am aware of his reservations about their proposed composition, but 1 should like him to make clear whether he believes that such companies should exist at all. If he does, I hope that he will appreciate that, if training and the Scottish Development Agency are not integrated, local enterprise companies will have the extraordinarily unattractive responsibility of entering into contractual relations with two entirely separate Government agencies. For that reason, among others, both sides of industry have opposed such arrangements, and have said that an integrated agency would be infinitely more desirable.

Mr. Dewar

I understand the points that the Secretary of State has made. It seems that we shall have some interesting debates in Committee. The Opposition are heavily committed to a genuinely devolved structure, but we are not convinced that the Scottish Enterprise companies will constitute the best way of carrying out such wide-ranging duties, or that they will be properly composed for such a task.

I do not want to make too much of the issue of the one-door approach. Let me say in passing, however, that if my suggestion that we retain a development agency and set up a Scottish training agency is such arrant bunkum as the Secretary of State seemed to suggest, he must have some very interesting conversations with his right hon. Friend the Secretary of State for Wales. As he will remember, his right hon. Friend has decided to retain the Welsh Development Agency and to have a Welsh training agency as well, for exactly the reasons that I have advanced.

I do not deny for a moment that this is a matter for genuine debate; none the less, to suggest that anyone whose ideas differ from those of the right hon. and learned Gentleman is unrepresentative, or has taken leave of his senses, is to advance a view that the Secretary of State for Wales would find extremely interesting.

Mr. Rifkind

I am content for the hon. Gentleman to promote himself as representative of Welsh opinion, as long as he is happy to concede that I am representative of Scottish opinion.

Mr. Dewar

I do not believe in arguing the impossible, and on this occasion I shall decline the Secretary of State's invitation.

I believe that there is something of a political motive behind some of the current restructuring. I too remember the attack launched by Mr. Bill Hughes, referred to earlier by the hon. Member for Banff and Buchan (Mr. Sahnond). Let me quote from it: The SDA has done nothing for Scottish business. It is one big bureaucracy and it hasn't delivered the goods. The best thing about it is its PR organisation. In fairness to Mr. Hughes, I should record that he told me that he had been speaking specifically about the SDA's policy on small businesses—although his reservations were stated in terms rather too wide to make that defence entirely convincing.

I believe that the aim is to remove the SDA—both the name and the organisation itself—because it is a constant, unacceptable reminder of a considerable success for the public sector. It represents a distinctly Scottish approach to partnership, which I believe should be retained but which we are in danger of sacrificing.

We shall want to look carefully at the local enterprise companies, both in the Highlands and in the SDA area. For me, they are a largely unknown quantity. We are told that we are to hand over vast powers to the private sector, which will have almost a semi-autonomous fiefdom to administer—all of it based on a narrow ridge of between eight and 12 board members in the SDA area, and between six and 12 in the Highlands and Islands. That must leave little room for trade unions, local authorities and indeed the wider community, whose members ought to be able to make an enormous contribution but will be left to struggle in through the side door.

To understand my doubts, the Secretary of State need only consult his own original White Paper on Scottish Enterprise. A much-quoted passage from paragraph 3 referred to the research carried out for the then Training Commission, which showed that less than one in three of those employers asked had a training plan and even fewer had training targets for their labour force. Less than half of the workforce covered by the survey received any training at all in 1986–87. Of course we need the important input from the commercial and industrial sectors, but we should not hand them exclusive jurisdiction when they have not even shown enough interest to plan their work force requirements. How can we assume that they will make an excellent job of other people's?

I know about the recent interviews and press publicity concerning the consortia. I do not make too much of the fact that Miss Kay Stratton was involved, as I do not know how influential she was in the evolution of the scheme; what strikes me as important is that she is from the Department of Employment, and was, I believe, a personal adviser to the late lamented Secretary of State. I do not know whether she holds the same position with his successor.

Then there was Mr. Brian Wolfson, chairman of Wembley Stadium—which did not, in my view, make him a particularly relevant or sympathetic figure. I know that the Secretary of State will wish to remind me that others too were involved: there were, for instance, Sir David Nickson and Alistair Mair of the CBI, whose dislike of devolution is a source of constant wonder to me. He must feel very uncomfortable while helping to preside over what, if the Secretary of State is correct, constitutes an element of devolution.

There was also my old school companion, Mr. Angus Grossart: I think that the House will wish to congratulate him on his recent award of a CBE, clearly well earned. I note that one of his first tasks was to interview Sir Michael Herries, a figure not unknown to the right hon. Member for Ayr (Mr. Younger). I gained some amusement from the idea of a very junior member of the Royal Bank of Scotland board interviewing its chairman to find out whether he was a fit and proper person to run an enterprise company. It was probably quite a testing little exchange, but I think that it was testing for Mr. Grossart rather than for Sir Michael.

I am entirely prepared to accept that many people are allowing their names to go forward, although some of them may be guid familiar and guid predictable. I note that Sir Norman Macfarlane has had to be slapped down by the Minister of State because, in his capacity as chairman-designate of the Glasgow company, he suggested that his bailiwick—I use the term advisedly—should include Bearsden and Eastwood. I am indebted to the Glasgow Herald for the information that he suggested half jokingly that the new company should be called "Glasgow Corporation": clearly he has ambitions to become the Pat Lally of Scottish Enterprise.

Then—surprise, surprise—there was Ian Wood of the John Wood Group, and Sir Charles Fraser, who I understand will head the operation in Edinburgh. I had a quick look in the most recent edition of "The Directory of Directors", and discovered that he currently holds 48 directorships. If we add Scottish Enterprise, he will have 49, one for each Labour Member—a splendid idea.

I do not want to make too much of the matter, but I feel that there will be problems over the time and commitment that such people will be required to give Scottish Enterprise. Although I do not doubt that they will set out with the best of intentions, there is a danger that the arrangements will degenerate into a board meeting once a month, and the equivalent of a report to non-executive directors. I also fear that the consultants will have a field day. No doubt Conran Roche and Peat, Marwick, McLintock are already hard at work, and they will be followed by many others.

As my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington) will probably point out later in the debate, it is likely that a raft or horde of sub-contractors will all be asking for the right to provide places, and any real innovation and control will be extremely loose.

Sir Donald McCallum of the Scottish Council (Development and Industry) voiced his worry about fragmentation in a speech on 8 December. Many others have made the point that the dangers are real and genuine. There is a danger that the enterprise companies will become very much hyped by their considerable powers. We understand that they will be able to spend up to £250,000 on projects. That is the glitzy side of the job. They will also be able to compete by trying to attract major developments, such as the 14,000 jobs being created in Renfrew and yet another national stadium which has been offered to Paisley only in the last week or so. I foresee that competition of that kind will lead to fragmentation.

The Secretary of State must provide information in Committee about the contracts that are to be made with Scottish Enterprise, which are to last for three years. In my television exchanges with the Secretary of State, I asked him whether the budgets would be controlled or monitored by Scottish Enterprise. I was told that I was mistaken, and that there would only be contracts. I accept that, but I want to know how the contract will be monitored. Will there be sanctions for non-performance? Can the contract be broken and taken away? I do not know the answers to those questions. Before we hand over to a self-selecting and largely self-appointed group of business men a public budget which, according to the Government, could in some areas be as high as £70 million or £80 million, we are entitled to know a great deal more about it. For obvious reasons, it will not be a short Committee stage. The Scottish Office will have to tell us how independent Scottish Enterprise will be of the Scottish Office. Very real restrictions concerning training, economic powers and directions are written into a number of clauses. Those restrictions may already be enshrined in the 1975 legislation and are being repeated in the Bill. We shall want to know how the powers will be exercised.

We shall also want to know how independent of the Department of Employment the Scottish Office will be when it comes to training. I gather from the Secretary of State's rather evasive answers today that the Department of Employment will be very much the dominating partner. Most of the Scottish Enterprise companies will simply be implementing established Government policy, which will be overseen by a national task force, in which Sir David Nickson is bivouacked as a nominal and token Scot.

If the Secretary of State thinks that I am the only one who has these worries, I intend to bother him with the views of one of those who enthusiastically supported the concept—Mr. Hamish Morrison of the Scottish Council (Development and Industry). According to a report in The Scotsman, he said: Now we have this Scottish Enterprise model. Is it really going to be a decision-making body in its own right? Or is it going to be a retailer for schemes that are devised somewhere else according to different perceptions? According to The Scotsman: Mr. Morrison said that he believed that the devolution of training proposed was more apparent than real and that Scottish Enterprise would be no more than a cheerleader for nationally constructed schemes. He may be right. If so, it puts a different complexion on what the Secretary of State told us.

I do not intend to labour the resources issue. We shall have a go at it in Committee. We are told that about £500 million will be available for the whole shooting match. It is an impressive figure, but it is a standstill budget, an amalgamation of the status quo. I want to know whether the Secretary of State can do better than that.

I remember, because I always listen with attention to the Secretary of State, that when he appeared with Mr. Jonathan Dimbleby in "On the Record" he gave a clear hint that a good deal more money would be available than simply an amalgamation of existing budgets. We should like to know what, when and how much. I am not encouraged by the explanatory and financial memorandum to the Bill, which refers to the financial implications as being broadly equivalent to what they are at present. It is not a pledge which gets the pulse racing.

We want devolution, but we do not want a pretence ai devolution to be paraded before the people of Scotland. Devolution must mean some form of democratic control. At the very least, it must mean a genuine measure of community involvement. I am not convinced that either of those conditions has been met. The very opposite is the case.

Something is fundamentally wrong with the proposal. It creates a new establishment that is narrowly based and unrepresentative. I do not doubt the genuine interest of those who are volunteering, but they are setting out on an uncertain course towards ill-defined objectives. I cannot get out of my head the phrases in the original White Paper about putting the employers into the driving seat and giving them a sense of ownership. I am not in the business of doing that. I want a genuine partnership and genuine co-operative effort.

When I consider the pressures that lie ahead, and the shake-up and shake-out that may come after 1992, I see that ministerial confidence about the proposal will be no great shield against economic reality. Only a week or so ago, the National Westminster bank suggested that during the next five years an ever greater gap would open up between the economy of Scotland and the rest of the United Kingdom. Scotland's share of United Kingdom output has declined over the last 32 years. I use that period because I do not want to be accused of partisan politics. In 1988, it was down 8.2 per cent. Our share of employment is below our population ratio. If we had been able to maintain our share throughout that period, another 200,000 people in Scotland would be in employment.

Despite all that has been said, our economy has been in decline relative to the United Kingdom and relative, even more markedly, to Europe. So long as that is the position, it is not right to set out a path that is going in the wrong direction.

Of course we shall encourage people to make what they can of the scheme. It would be silly and Luddite to do otherwise. There is no question of boycotts, or of trying to hold back, or of putting a spoke in the wheel of any enterprise company. However, it would be wrong and irresponsible not to state our reservations. I do not believe that the scheme is a quantum leap, to quote the Secretary of State, or that it will banish the spectre of high unemployment, or that it will make the Scottish economy a leader in Europe. It has been launched on the wrong basis. It has been based to some extent on ideology and political calculation. It does not provide the right structure and it is not the most hopeful way to harness the full range of Scotland's talents. That is why the Opposition cannot support it.

6.17 pm
Mr. George Younger (Ayr)

My Scottish colleagues may be somewhat surprised if I begin by saying that it is enormously refreshing to see the hon. Member for Garscadden (Mr. Dewar) still in splendid form. He does not seem to have lost any of it. I cannot, however, agree with his conclusion. He has done his best to justify the lonely position that my right hon. and learned Friend the Secretary of State for Scotland described him as holding. All that he has said amounts to an enormous agenda for asking questions in Committee and examining the Bill throughout its passage, but he has said nothing that would remotely justify hon. Members in voting against the principle of the Bill.

The hon. Gentleman did not succeed in making a convincing case. The more he tried to make it, the more it appeared that the vast majority of people in Scotland, including all those who were instanced by my right hon. and learned Friend, are right to say not that they approve every detail in the Bill but that its general thrust is right. Many of its provisions have been awaited for a long time by those who are concerned with the Scottish economy, but they had to wait until my right hon. and learned Friend succeeded in finding the means to put them into effect.

Mr. Ernie Ross

The right hon. Gentleman, who has been responsible for the defence of the country, among other things, over the last few years must find it difficult again to assimilate the Scottish mentality. The Scottish people say that they want training to be under the control of Scottish agencies but that there ought to be a division between training and the very good and progressive role that is played by the Scottish Development Agency. The Secretary of State failed to refer to that honest assessment.

Mr. Younger

I understand the hon. Gentleman's point, but I am certainly not trying to get back into the Scottish mentality as I never left it. Our attitude has to be guided by the judgment of hon. Members on both sides of the House as to what will best bring together the various energies and enthusiasms of the Scottish industrial community to help better development and training. The hon. Member for Garscadden's comments can be summed up by saying that he is strongly in favour of devolution, provided that nothing is devolved to anyone.

I start by welcoming particularly strongly the fact that at long last the training function for Scottish industry will be clearly the responsibility of the Scottish Office and the Secretary of State for Scotland. That is not to criticise the great efforts that have been made in recent years, including the degree of devolution of responsibility that has been achieved. The utmost good will has been shown and great efforts have been made to tailor the training effort to the needs of Scottish particularities, but it has not got as far as we had hoped. Now that we have a United Kingdom training policy with its Scottish component properly situated in the Scottish Office under the control of the Secretary of State—a member of the Cabinet of course —we have achieved the desire of many people in the Scottish economy. It comes at an appropriate time. At no time has the improvement of training, the widening of its scope and a change in attitude towards training been needed more than now.

Despite all that has been done in recent years to transform training—and the situation is completely different from what it was even 10 years ago—as a nation we still do not really identify or understand the cultural importance of training to our jobs. To some extent, we are still a nation of amateurs who admire the person who can get by and tend to look sideways at the person who is so meticulously trained for what he does that he works really efficiently and methodically all the time. That is a matter of our national attitude which goes way back in history. A closer relationship between the Scottish community and the organisation of training will be a quantum leap, as my right hon. and learned Friend suggested, and will certainly represent a major shift in attitude of everyone in the Scottish economy to the importance of training.

Training is overwhelmingly important. No business, large or small, can afford to continue its operations without paying close attention to training. Even the smallest firm has to find a way of taking part in it and making sure that its training is of the highest standard. I should like to pay tribute to Bill Hughes for the way in which he produced the scheme and catalysed it into what my right hon. and learned Friend has put into the Bill. Of course it has widespread support throughout Scotland. That is quite remarkable and is a great encouragement to those involved in it. I am sure that when they get down to work they will be backed up with a wide range of support.

Much of the debate so far has been concerned with the local enterprise companies. My right hon. and learned Friend had a very good point when he made it clear that if one does not approve of the idea of enterprise companies, certainly in the Scottish context—I do not know anything about the Welsh context which has been mentioned—one has to explain why it would seem sensible to continue the divide between industrial development and promotion generally and training, which is such a vital part of it. Over the years perceptions of training, the ability to provide training and the quality of training have steadily taken a more important role in industrial promotion, and particularly in attracting industry from outside Scotland. It is taking an even more important role now as in many cases industries which are trying to find a place to settle find that the real barrier is not sites, because sites are available, or finance, because there is finance, including grants in some areas, to back them up; the limiting factor is almost always the availability of skilled labour. That is very much the case today even in areas of high unemployment. On that score, the local enterprise companies will bring together promotion and training and that should he undertaken by local business people.

The hon. Member for Garscadden is among those who are dubious about control of the scheme being in the hands of local people who have been selected from local areas in Scotland. One of the great secrets about the success of the SDA has been the extraordinary efforts that it has made —very successfully—to involve in its work every sort of other body, interest, people, units and firms. In recent years, it would never have made such remarkable achievements by being a public enterprise authority only and trying to do things from above. It has achieved them overwhelmingly in co-operation with local authorities and private enterprise.

It is an extraordinarily good time to make such a change, to look at the enormous successes in the past few years, and to look to the future for the changes that may be needed to do even better. Of course there are still numerous problems in our economy. Of course there are still parts of Scotland where unemployment is higher than it should be. The main reason for that is that the people who are unemployed are not being trained effectively. That is not their fault; it is our fault over many years.

However, irrespective of that, the Scottish economy is incomparably different and incomparably better than it has been in the past. It has a better record on growth and productivity. It has one of the best records in the United Kingdom for the earnings of people in employment. There are increasing numbers of people in employment in Scotland. For most of the past year there has been the largest ever number of people at work in Scotland.

All those factors suggest that the Scottish economy is in a very good state. That is the overwhelming impression one gets from talking with Scottish business people running large and small businesses throughout the country. The CBI, the Scottish Council (Development and Industry) and many further afield have confirmed that the current climate for business in Scotland is very good, and that optimism and confidence are high throughout Scotland. It is sad and unfortunate that, because that has not had anything like the presentation that it ought to have had, many people in Scotland do not feel the remarkable pride that they should take in a Scottish economy which has been doing extremely well compared with most others in Europe.

I do not think that we should give the Bill a Second Reading today without referring to the record of the SDA and the HIDB. Although I hope that many of their functions and people will continue for a long time in future under a new name if the Bill is passed, nevertheless it is still a good opportunity to look at the achievements of the SDA.

The general format of the SDA changed quite substantially in the early 1980s and was brought into a much more private enterprise context. Some criticised that as a retrograde step and thought that it would not do so well as a result, but quite the reverse has been the case. We should pay a warm tribute to it for the immense efforts that it made to change the context in which it did its business. It moved from its offices in Glasgow into the community to join not only private enterprise, which was an extremely important part of its work, but local authorities, regional authorities and district councils. Many people who work for the SDA can speak of the difficulties that they had in persuading some local authorities to co-operate with them, but they succeeded in getting that message across and many people and local authorities in Scotland have been thoroughly converted to the fact that they can do effective business with the SDA.

There is no better example of that than the city of Glasgow. This is its year of culture, but that is something smaller than the enormous transformation in the fabric, spirit and everything that has gone on in Glasgow for the past few years. Overwhelmingly the SDA has not only contributed but has taken the initiative. Perhaps it was essential for somebody to do that, but all the big initiatives in Glasgow had their origins in the SDA, such as the exhibition centre, which undoubtedly was a private enterprise organisation but which was initiated by the SDA and for which it arranged funding from local authorities and the private sector.

There is no question but that the cement that held together the four different components of the Glasgow area eastern renewal and made it so enormously successful was the SDA. It offered its officials, skills and diplomatic skills and held them together in a way that nothing else could have done. It also had to give leadership on the environment to convince people whose sights understandably were set solely on the main objective; but that main objective of a better Glasgow with more jobs and better industries would not have been achieved unless the SDA had first put right the environment. Some of the worst eyesores in Glasgow were cleared up. The SDA introduced private housing into areas that needed, and got, a lift, and many parts of Glasgow are a monument to that. Although it did not have much to do with it, one can add to that the enormous boom in housing association activity in Glasgow. Much local enthusiasm was harnessed and driven by local people, which led to many marvellous homes of great quality and remarkably improved the appearance of the city in recent years.

Mrs. Maria Fyfe (Glasgow, Maryhill)

Notwithstanding the enormous improvements in housing in Glasgow, including housing association housing which has recently been built in my constituency in particular, the massive problem of unemployment remains. Of the 20 worst constituencies for unemployment in Britain, no fewer than eight are in Glasgow. How will enterprise companies provide training when jobs are not available?

Mr. Younger

I respect the hon. Lady's feelings, and I am sure that 1 would share them were I in her position, but it does nothing for Glasgow not to recognise its enormous achievements. Unless we recognise what has been done, why it has been done and by whom, it is most unlikely that we shall be able effectively to tackle the next stage of solving the worst problems. As the hon. Lady rightly said, there is still much to be done in Glasgow, but it is no good turning our backs on what has been done and belittling it. One should be proud of it, and I believe that Glasgow is; that certainly is the impression that one gets from talking to anyone in it.

Mrs. Fyfe

On a point of order, Mr. Speaker. I draw the right hon. Gentleman's attention to what I said at the beginning of my intervention. If he reads Hansard tomorrow, he will find that I acknowledged the improvements in housing in Glasgow. Far from ignoring them, I acknowledged them at the beginning of my intervention.

Mr. Younger

I do not dispute that, but I urge the hon. Lady to do more to solve the remaining problems and not to pretend that many have not already been solved. There may be lessons in that that we can all learn.

Mr. Mike Watson (Glasgow, Central)

The right hon. Gentleman said that we should recognise what has been done. I am prepared to recognise the role of the SDA in the Glasgow eastern area renewal—the so-called GEAR project—but he failed to mention the role of Glasgow district council and Strathclyde regional council, which was vital to the success of that project. With that in mind, will he impress on Ministers that local authorities have a vital role to play in Scottish Enterprise?

Mr. Younger

I emphasised that the SDA has been very successful in working with local authorities, and I pay tribute to it for that. It is unnecessary to suggest to my right hon. and learned Friend that local authorities have a vital role to play in Scottish Enterprise because he acknowledged that in his speech. The hon. Gentleman and I agree on that.

In Glasgow, the St. Enoch centre and the garden festival were enormously influenced by the SDA. We should pay a great tribute to Sir Robin Duthie and George Matthesson, who did much for the SDA over the years, and all the staff who worked with them.

I am sure that the hon. Member for Dundee, West (Mr. Ross) is anxious for me to mention that the transformation in Dundee has been no less remarkable than that in Glasgow. Anyone who has not visited Dundee for 10 years would hardly know what city he was in if he did so today. That has been achieved with the enormous co-operation of the local authorities, people with interests in Dundee and private enterprise, but the catalyst was the SDA, and no one can take that away from it. I hope that in Committee —I know that my right hon. and learned Friend the Secretary of State believes this—we shall ensure that the skills and expertise that the SDA has used so effectively are carried through as much as possible into the new organisation and given a new opportunity to flower.

In the interests of time, I have not dealt with the Highlands and Islands Development Board. It has achieved many successes and I have no doubt that its work is equally appreciated in the Highlands.

I must also mention the leg-up scheme—a strangely named scheme—which was the brainchild of the SDA. It has been used in many smaller communities throughout Scotland. As hon. Members will know, the catalyst for it was the SDA and much of the money was private, but one brought about the success of the other. It was a great success story, and I hope that Sir David Nickson, whom we wish every success in his work, will be able to capitalise on it.

The key element in much of the success of the SDA has been the skill and dedication of its staff. They are impressive people of great ability, and we must never take them for granted. There are two things that we must not take for granted when talking about them. First—I know that my right hon. and learned Friend will probably have difficulties with his colleagues and the Treasury on this —we must ensure that we pay what is necessary to get the best people to run the technical side of Scottish Enterprise, as we had with the SDA. I know from my colleagues that it is difficult to obtain agreement for that, but it is vital.

Secondly, we shall not keep the best people to do the jobs—even if we pay them as we should—if they do not feel that they are working in a team in which their peers are of similar quality. These people are mobile and very much in demand. I am sure that Sir David Nickson wants the teams working in Scottish Enterprise to be of as high a quality as those who have worked with such success in the SDA.

I agreed with the hon. Member for Garscadden when he said that the Scottish new towns were a remarkable Scottish success story. They have always been different from the new towns south of the border. In most cases, they have been outstandingly successful. Over the past seven years, no less than 40 per cent. of inward investment by value has been attracted to our new towns. I know from visiting many overseas companies which were thinking of coming to Scotland that one could talk as much as one liked—and I did—about the opportunities everywhere in Scotland but that there was an enormously strong pull from the new towns because companies liked what they saw there.

Some of the lessons have spread beyond the new towns and other areas have benefited. The achievement of 40 per cent. by value is impressive and over 30 per cent. of jobs has been provided by the new towns. The hon. Member for Garscadden touched on that lesson.

Mr. Ingram

The right hon. Gentleman will remember that when he was Secretary of State for Scotland he issued a policy statement on the housing aspects of the new towns. He said: Once the winding up process begins housing still held by a corporation will be transferred as soon as practicable to the District Council within whose boundaries the town is situated. It was not long ago that he made that statement, but I assume that he has changed his mind as he now supports the Government's policy. What has caused him to change his mind? Does he accept that it should at least be an option for the tenants of development corporations to choose the district council if all the houses are not to be transferred to the same district council?

Mr. Younger

I appreciate that, but, having read the Bill carefully, I believe that it contains that option. The hon. Member for Garscadden also said that he assumed from the Bill that those possibilities were not ruled out. People will be able to exercise choice. I do not know how practical it will be for each householder to exercise a different preference from his neighbour, but 1 am sure that my hon. Friend the Minister will be able to tell us what options are in the Bill. I assume that tenants will have options and that is certainly in keeping with the enormous change that has taken place in Scottish attitudes to homes in the past few years. That is especially true of the new towns. More than 50 per cent. of people in the new towns have elected to become home owners, which shows a remarkable change of attitude in the past 10 years.

I have now spoken for long enough and I am grateful to the House for listening to me. The whole House should support the Bill and I hope that the hon. Member for Garscadden will think hard before he votes against the principle of the Bill. He has every right to try to alter it in Committee, and I am sure that he will try to do so, but there are no grounds for voting against the principle of the Bill. The Bill is another Scottish first and comes at a time when the Scottish economy is a pillar or success in western Europe. The Bill has a wide measure of support among the people of Scotland, as is shown by business people and others who have expressed their views.

6.43 pm
Mr. Norman Hogg (Cumbernauld and Kilsyth)

I shall not follow closely the speech of the right hon. Member for Ayr (Mr. Younger). He made a fairly substantial speech and clearly he is setting out his stall, as it were, to become Leader of the House of Lords. I am sorry to say that he will be disappointed because he will be shadow Leader for the Conservatives in the House of Lords. However, he has made such a good case for the new towns this afternoon that I intend to submit his name to the Committee of Selection so that he can be selected for the Standing Committee and can give us a hand in making the case for the new towns. I hope that I shall be appointed to that Standing Committee.

I shall not say a great deal in detail about the proposals that apply to Scottish Enterprise, and Highlands and Islands Enterprise, but will confine my remarks to the new towns. In Committee I shall, of course, play my part in debating the other important matters.

My first interest in the new towns arose in 1967 when I was appointed a district officer for the National and Local Government Officers Association. My first job there was to deal with a problem in Cumbernauld. I was surprised 12 years later to discover that I was Member of Parliament for that new town. Throughout my 23 years' association with Cumbernauld and the other new towns, I have never doubted the mertis of the new town idea. Like the right hon. Member for Ayr, I believe that their record speaks for itself. I am proud of that, because new towns were set up by the 1945 Labour Government. They are a distinctly Socialist idea—and a very successful one at that.

At the end of the war, the great cities of Glasgow and Edinburgh had serious housing, social and environmental problems. It was clear that solutions could not be found within the context of those great cities and that there had to be another way forward. The new towns were one of the solutions. They offered green field sites, quality housing, jobs and a planned environment. The development corporations were instruments of economic intervention and no one can deny their success in that respect. I remember the right hon. Member for Ayr telling me in reply to a parliamentary question some years ago that about 70 per cent. of all inward investment to Scotland was located in the new towns. That achievement speaks for itself. The new towns continue to attract the new sunrise industries on which Ministers place such importance and the case for public sector development corporations is established by their record in that respect. The case for private sector development companies remains to be proven. I am sorry that the Government are motivated by their ideology in all that they do at present.

When he was Secretary of State for the Environment, the right hon. Member for Henley (Mr. Heseltine) was keen on selling off the new towns. At that time, the right hon. Member for Ayr showed more sense and resisted the winding up of Scottish new towns. He was right then and he would be right now if he were to say that the job for the development corporations remains, and that there is still much to be done in coping with unemployment arid creating jobs in the new towns. That is best done by the development corporations, so I am sorry that, with the proposed timescale, the Government are determined to wind up the new town corporations.

By and large, the new towns built quality houses, although some mistakes were undoubtedly made. Some estates were badly planned and we have suffered as a consequence, but, on the whole, good use was made of the green field sites and public confidence in that housing is reflected in the high level of sales in the new towns.

I remind the House that the concept of selling houses in new towns did not arrive with Conservative rule. There was always a tenant's right to buy in the new towns. Although undoubtedly the tenants rights legislation changed substantially the terms on which that could be achieved, the principle that houses could be bought always existed.

Sir Nicholas Fairbaim

I had the good fortune to be at the planning conference of landscape architects at which Cumbernauld was thought up. Does the hon. Gentleman agree that it is remarkable that there is nothing in any of the new towns that the corporations have built that is ever likely to be listed as something which we should preserve?

Mr. Hogg

I am not in a position to comment on other new towns and I have no doubt that hon. Members who represent other new towns will refer to the issue which the hon. and learned Gentleman has raised. By and large, the houses built in new towns are good and are selling. But I agree that there has been a disappointing lack of buildings of note and I agree with the hon. and learned Gentleman that we have not done as much as we might have achieved in that sphere.

I am sorry to say that the Government have not, for example, given the green light to a proposal by Cumbernauld and Kilsyth district council to build a proper civic centre for the town to replace the nasty prefabricated local town hall that was built by a previous SNP administration, the members of which have joined with the Tories in opposing the proposal to build a proper civic centre. We expect that of the SNP in Cumbernauld, though I assure the hon. Member for Banff and Buchan (Mr. Salmond), lest he attacks me, that I do not associate him with the SNP in Cumbernauld and Kilsyth.

There remains a case for new building. The lifting of the moratorium on new town building for which the Minister of State was responsible did not create the conditions to resolve the continuing problem of young people being able to find a home in the town in which they were born and raised.

Today in Cumbernauld there is a waiting list of 1,230. We have 37 single parents without homes and 325 single persons and 183 engaged couples on the waiting list. Indeed, 545 young people who were born and bred in the new town are unable to find homes there. They are not able to find a way into the private sector because of high interest rates, low pay and youth unemployment. That is why there is a strong case for a public sector new build programme.

Another problem for tenants is that the proposals in the Bill do not say that tenants will be given the choice of having the district council as their landlord, as my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) pointed out. I cannot understand the Minister's reluctance to offer such a choice. I understood that even under the new regime in Chester street—under the proposals of some strange people who have taken it on themselves to run the Conservative party and who are insisting on a peculiar ideology of their own—the Tories were in favour of choice.

We are simply asking that district councils be included in the choice available to tenants. If the Minister cannot assure us tonight that that choice will be written into the Bill, my hon. Friends and I will table amendments to that end in Committee. Such a refusal by the Minister would ignore opinion in the new towns. It would be wrong for the Government to ignore public opinion on an issue as basic and important as the future ownership of people's homes, and I hope that he will change his mind about what is proposed.

On the local government side, I note that the planning function is to go to district councils. That important shift is to be welcomed because, whatever may have been the achievements of the development corporations in attracting jobs and investment, they have not been popular as landlords and planning authorities. Indeed, we continue to face problems over their responsibilities in those respects, as other hon. Members who represent new towns will agree.

That is why we welcome the proposal to place planning matters in the hands of district councils. May we be told how and when the planning function will be transferred to district councils and whether financial assistance will be available for receiving authorities which will have to increase staffing levels to deal with the new responsibilities? Perhaps the Minister will answer those points when he replies to the debate or give an assurance that he will answer them in Committee.

The Bill is curiously silent on what is to happen to existing employees. In previous measures—for example, those which dealt with the reorganisation of local government—the interests of staff were clearly defined. Those provisions served Scotland well because proper arrangements could be made for the transfer of staff.

What arrangements will be made in this case for the continued employment of staff where functions are transferred? Will any of the arrangements that were employed in, say, local government reorganisation be introduced in this case? In other words, will arrangements be made to ring-fence the staff and will assurances be given that on wind-up staff will be absorbed in local authorities which take on additional functions? What arrangements will exist for severance payments, superannuation, pensions and so on?

I have been asking questions in wide terms rather than specifically because I appreciate that the Minister may have difficulty in answering them tonight.

Mr. Dalyell

They are important questions.

Mr. Hogg

My hon. Friend is right to say that they are important, and at some stage they must be answered. If necessary, I shall table probing amendments to discover exactly what will happen to the staff. It is important that they are maintained in employment, right up to the point of wind-up, and a continuing job will remain to be done. It would not be in the interests of the new towns if skilled teams were lost. I warn the Minister that if he does not answer my questions tonight or if we do not receive satisfactory replies in Committee, I shall write seeking a meeting with him on these important issues.

I do not like what is being proposed for the new towns. It flies in the face of what new town dwellers and workers have expected and planned for in the last 40 years. Indeed, it flies in the face of all that was envisaged by those who pioneered the new towns idea and who went to live in new towns in the early days.

I am sorry that once again the Government have founded their views on their strange ideology to such an extent that they deny people choice. That is carrying matters too far. I would go as far as to say that the Bill reduces tenants' rights. As I understand it, that is not what the Government would describe as one of their objectives in previous legislation. I believe that the Bill's proposals place at risk the continuing economic achievements of the new towns and for that reason I shall oppose the Bill.

Several Hon. Members


Mr. Speaker

Order. I remind the House that the debate started late. I ask hon. Members to keep their comments brief so that I can call many of those who wish to participate.

7 pm

Mr. Bill Walker (Tayside, North)

I welcome the Bill. That will not surprise my colleagues on the Front Bench or Opposition Members. It is wise to integrate training and the economic regeneration of the two parts of Scotland covered by the two development agencies—the Highlands and Islands Development Board and the Scottish Development Agency. I also welcome the fact that we shall control training in Scotland because the special Scottish aspects of training must be addressed.

The House and anyone who cares about what happens in Scotland must consider the awful fact that we have unemployment in some areas yet in others there is an enormous skills shortage. That shows that things have not been done right over many years. There will be a skills shortage because demographic changes will result in a 20 per cent. fall in the number of 18 to 24-year-olds by 1995. That is only five years away. Through the vehicle of the Bill and by the changes that we hope to make when it becomes law, we must address that problem.

The House will know that I recently spent a little time looking into the plight of the cardboard community in London. I was particularly interested in the position of teenagers, although one could spend much time talking about other groups. The nation must face the fact that the family unit as many of us knew it when we were growing up is not the unit that is common today. It is breaking up in front of our eyes. More families are noted for breaking up than for stability. That has resulted in many teenagers leaving home. I shall not go into the reasons why they leave home; it is simply a fact that they do so. Some leave because they can no longer accept the conditions in their family home and others do so because they will not accept discipline from their parents. So they find themselves out in the big world.

Earlier today we heard of a pregnant 16-year-old who was looking for a house. We must address the problems of such people. It is no good saying that they should not happen because they do. I have some ideas about what we should do about them. It will be within your memory, Mr. Speaker, and that of other hon. Members that at one time large firms, particularly in London, had hostels to encourage young people to come to London to be trained to work in the company. That was before the second world war and immediately afterwards. Sadly, in the 1960s most of those hostels disappeared. If we still had them today at least we should have an opportunity to provide some sort of accommodation for young people.

Young people migrate mainly to large towns and cities, whether London, Glasgow, Edinburgh, Dundee or wherever, because they think that the opportunities to find work and accommodation will be greater. I should like the enterprise companies to encourage large and medium-sized firms there to provide hostel accommodation. Companies in my constituency tell me that they are desperate for young people but that there is no accommodation for them. I should like to think that the new training and enterprise companies would put together a package whereby the private sector, assisted by public funding, would find a way of providing hostel accommodation linked to a training commitment.

We should take the opportunity that the Bill provides carefully to consider skills training. For too long we have not considered it in sufficient depth. In the 1960s I played a part in establishing the training boards and I was proud of what we did. I was saddened at the way in which the boards drifted away from their original purpose of training. I, and others who were keen in the beginning, grew disillusioned. That is no reason for saying that we were wrong in what we attempted to do in the 1960s. If we had got it right, we should not today be facing problems of skills shortages.

We must ask why the taxpayer is prepared to pay for those who have the ability and good fortune to go into higher education. The taxpayer picks up the cost of all their training and education, yet any young individual who has tactile skills—the type of skills that are required for skilled work—does not receive the same support from the taxpayer. In recent years there has been the development of employment training, which now lasts for two years. As a result of the changes made by the Bill, we should develop three-year skills training programmes through the enterprise companies. If we do that and fund them properly, we shall effectively give every youngster the option of skills training or higher education.

By skills training I do not necessarily mean the narrow, highly technical skills but all skills. People who go into shopkeeping need good communications and human relations skills. We certainly need to develop human relations skills because such skills are sadly lacking. We must also develop management skills. Managing people is a highly developed skill and, sadly, that is another area in which we have not enhanced our reputation in the past 40 years. I should like skills training in its widest sense to be encouraged at all levels and the enterprise companies and new enterprise agencies to be developed.

I notice that the Government have set a target of 12 enterprise companies. My right hon. and learned Friend the Secretary of State was right when he said that many individuals had come forward for these enterprise companies. I may add that the 12 companies will be in the Scottish Development Agency area. I apologise to the House if my main interest lies in the SDA area, but that is where my constituency is. It is not in the Highlands and Islands area although people in the Highlands area of my constituency say that it should be, because of the advantages, whether real or imagined, that exist in the Highlands.

Dr. Godman

The hon. Gentleman spoke about industrial training boards. Was not Mr. Robert Carr persuaded to introduce the Industrial Training Act 1964 because industrial firms refused to train their work forces? What sanctions can be used now, by way of the Bill, against such firms? The Bill will not be amended in Committee because the Government do not like to accept fair-minded criticism of their Bills. What sanctions can be used to persuade firms to train people instead of poaching them from other firms? May I also point out to the hon. Gentleman that unemployment and skills shortages can occur side by side?

Mr. Walker

I thought that I had made it clear that I realise that unemployment and skill shortages can occur cheek by jowl. I also understand the problems that companies face when the people whom they have trained are poached. I always thought that reflected on the training schemes that I ran in the companies for which I was responsible, and I never looked upon it as a down side. The benefit, I always thought, was that one kept the really good people. That was my experience, although I cannot speak for other organisations.

I am not as keen on imposing sanctions as I am on providing an environment in which people are encouraged to participate. The changing of attitudes is very important. We need to bring together enterprise, with which the SDA has been involved, and the Training Agency so that we can create arrangements that encourage both enterprise and training. The two have not always moved in tandem, and that has been part of the problem.

Had the hon. Member for Greenock and Port Glasgow (Dr. Godman) been listening carefully, he would know that I suggested that training be paid for from the public purse. That may astonish him, coming from me, but I have advocated that throughout my adult life. I never understood why, if one went to university, the public picked up the cost, whereas if one wanted to be an engineer—the nation is desperately short of engineers—the cost of one's training must be borne entirely by one's industry or company. That has never struck me as a sensible use of national resources.

I regard the Bill as an opportunity to bring together the aims for which I have worked and to try to ensure that we train young people for the world of today and tomorrow. That is much more important than all the nonsense that is talked and all the charades about defending jobs that should have gone a long time ago in industries that are out of date and no longer competitive. We should be encouraging the sunrise industries and encouraging young people to go into them. We must also encourage people to go to work where there are opportunities. In my constituency, that means going to work in tourism, and that is why I am so interested in the service sector, in which human relations skills are vital.

The Bill will bring together two essential parts of Scotland's development and future. We shall have to consider the details of the Bill in Committee, but I welcome the principles behind it.

7.12 pm
Mrs. Ray Michie (Argyll and Bute)

I listened to the Secretary of State using the same enthusiastic rhetoric this afternoon as he used in his statement on 26 July last year in enlarging on his plans for the Highlands and Islands Development Board and the Scottish Development Agency. I am acutely aware, however, of the existence of clause 21, which allows for the dissolution of the SDA and the HIDB. Many of us still ask why that has to be the case. The Secretary of State has not yet made it clear why that has to happen, while the Bill is vague and imprecise and gives no idea of how the new agencies will work better than the old.

Why are the Government getting rid of the well-known and much-respected names of the agency and the board? Is it normal practice in the business world to drop a brand name that has proved itself and sold well? Time, money and effort are spent in establishing a name with which customers identify and in the private sector, particularly, the protection of names is considered to be a top priority. To substitute for the SDA and HIDB a phrase containing the overworked and desperately boring word "enterprise" shows a lamentable lack of understanding and foresight.

We have heard fulsome praise, and rightly so, for the work of the SDA from the right hon. Member for Ayr (Mr. Younger). But everyone should be aware that the agency has gone through a period of uncertainty and that, as a result, the work force is severely demoralised. Programmes have not gone ahead and the number of staff who have left since 1987 gives great cause for concern. There is no doubt that we are talking about a politically determined change of direction. To achieve that change of direction, the Government are destroying instead of building on what is already there. The suspicion remains that the Bill is a move by the Government to get their own placemen into the structure. By selling the public assets of the SDA in a headlong ideological venture, the Government will reduce the influence of the public sector and benefit the few private business men in Scotland who still support them.

As the hon. Member for Ayr said, the SDA is the envy of many in England and has also been studied by many Europeans. It is admired for its flexibility, independence, creativity and effectiveness. The danger is that the Government are throwing it out in the interests of achieving short-term political goals.

We have heard much about training, and a highly skilled and competent work force is crucial for the economic and cultural well-being of Scotland. I, too, welcome the transfer of decisions about training from Sheffield, but the Secretary of State has still to reassure us that there will, indeed, be full devolution of responsibility for training from the Department of Employment to the Scottish Office. There must be no suspicion that the Department of Employment is resisting the long overdue decentralisation or blocking what the Secretary of State admits should be a Scottish solution to meet Scottish needs.

The Government have not yet established a satisfactory case for the merger of the SDA with the Training Agency. Organisationally it is a horrendous prospect, but if it must go ahead, it must boost the role of training in economic development and hasten the process of urban renewal, as well as encouraging a more dynamic and innovative approach to training. It is vital that the deployment of Training Agency staff should be decentralised. I am still not confident that our business men and women will want to become agents for administering Government training schemes for any length of time. The Government are placing a disproportionate emphasis on the need for the private sector to take the lead in the management and design of training. We need a review of existing training schemes to see whether they are suitable for Scotland's training needs.

We need more effective training for trainers. The experience of the youth training scheme and the employment training scheme shows that the quality and professional competence of trainers varies enormously. Equally important is the need for effective monitoring of training standards. The provision for the inspection of training agencies is absurdly small and can give scope for abuse.

The Secretary of State himself paid tribute to the work of the HIDB. Will the Minister of State explain how the HIDB warrants such a wholesale upheaval? It has already devolved its work and personnel, it has been serving the Highlands and Islands well over the past 25 years, and it has been keeping in close touch with the people. Why try to mend it when it is not broken?

Is the Secretary of State confident that local enterprise companies will be truly representative of the various geographical localities and businesses, including crofting and farming? Is he confident that the best of our business men and women will again want to be agents for administering Government training schemes and that small businesses will be properly represented? The majority must devote all their time and energy to keeping their own businesses going in the face of continuing high interest rates. Is the Secretary of State confident that local enterprise company representatives will travel hundreds of miles to attend meetings and to perform public services without remuneration; that board members will not reject applications if they consider them to be in competition with their own businesses; and that confidentiality, particularly of business accounts, will always be observed?

Is it not anomalous that agencies are intended to serve the needs of local communities, yet the Government's proposals contain no provision for accountability to them? Will the Secretary of State consider a substructure in large rural areas? Will he consider my constituency of Argyll and Bute, in which local enterprise companies are to represent Argyll and Bute, Arran and the Cumbraes? It is a vast area. It will be extremely difficult to have frequent meetings. The needs of Bute are quite different from those of Lochgilphead.

The Secretary of State talked about an increase in the population of the Highlands and Islands. He was correct, but he should not be misled. That increase did not occur because the indigenous people are staying and multiplying or because they are returning in droves. On the contrary; too many local people have been forced to leave because they cannot compete for housing, farms and crofts. They cannot compete with newcomers with overflowing wallets. Is the Minister aware that in many villages in Scotland one would be hard-pushed to hear a Scottish voice? That trend will eventually take its toll on the tourist industry.

It is clear that people in the new towns fear that the Government are riding roughshod over residents' freedom to choose the sort of organisation to which they wish to belong. The Bill does not give tenants a statutory right to transfer to a relevant district council. Many residents face an uncertain future. They do not trust the private sector to safeguard their interests. Nor does the Bill contain an obligation to address the needs of homeless people in new towns. There are still far too many homeless people.

Because of its vague and superficial nature, the Bill leaves many important questions unanswered. The Government are resorting to a simple-minded, dogmatic and impracticable solution. The Bill will he passed because the Government have a majority, but they must not kid themselves that it has been greeted enthusiastically everywhere. People in my area say, "Well, it is coming." I say, "It is coming, and we must make the best of it." They shrug their shoulders and are sceptical. The Bill will not help Scottish people by creating the environment, the infrastructure, the skills and the opportunities that will encourage them to live and work in their own area.

7.25 pm
Mr. Allan Stewart (Eastwood)

The hon. Member for Argyll and Bute (Mrs. Michie) will not expect me to echo her remarks, particularly those about her own constituency. No one is suggesting that the Highlands and Islands Development Board is not doing a good job. What is suggested is a change of structure to incorporate the economic regeneration functions of the HIDB and the Scottish Development Agency with the functions of the Training Agency. When the White Paper was published, the SDA warmly welcomed Scottish Enterprise and the fundamental proposal that training and development functions should be integrated.

The Opposition's amendment is disappointing. It is much more negative than the speech of the hon. Member for Glasgow, Garscadden (Mr. Dewar). He said, "We want reassurances about this and we want to explore points about that," and so on. His speech contained many markers for the Committee. However, the hon. Gentleman failed to mount a coherent argument for a rejection of the proposals. My right hon. and learned Friend the Secretary of State mentioned some points of general principle that have been taken by the Convention of Scottish Local Authorities. COSLA states that the general objective of integrating the Government's support for training and for enterprise creation is welcomed by the convention. The convention went on to state that local authorities have been committed to this approach in practice for some time.

Dr. Godman

One of the reasons why I almost instinctively oppose Government measures is the intransigence and hostility of Ministers to any fair-minded criticism in the form of reasonable amendments. Ministers are almost always hostile to the honestly awkward critics as well as to the awkwardly honest critics in the House.

Mr. Stewart

The hon. Member for Greenock and Port Glasgow (Dr. Godman) has said that he is not prepared to consider proposals on their own merits. Sitting next to him is the hon. Member for Cumbernauld and Kilsyth (Mr. Hogg). During the Comittee's deliberations on the Scottish education Bill, about 13 of his amendments were agreed as a result of reasoned argument with the Government. It is highly possible that the Bill will be amended in Committee.

Will the hon. Member for Clydebank and Milngavie (Mr. Worthington) confirm that the approach to the subject that the Scottish local authorities maintain they have been adopting for some years is wrong? On behalf of the Labour party, will he say officially that the approach taken by COSLA and local authorities to the basic principle of integration is completely wrong? I suspect that he will not do so as he is in conversation with his Whip rather than listening to the debate.

I welcome the principle of the Bill for a number of reasons. Training is likely to be more and more important in the process of economic regeneration. Let us consider the recent changes in eastern Europe and think not of the political consequences but of the economic consequences. We all hope that those changes result in eastern European economies becoming more integrated with those of the European Community. Eastern Europe has rejected state Socialism and is moving towards the capitalist West. That means that there will be a whole range of new countries competing with Scotland, something that we should all welcome. At least, initially, they will be low-wage countries—but they will be competitors for inward investment. That is an additional reason why we must emphasise our strengths, and the greatest strength that we have is the skills of our people.

The hon. Member for Garscadden took a different line on resources from that of the hon. Member for Clydebank and Milngavie. If this morning's Glasgow Herald is correctly quoting his views, the hon. Member for Garscadden accepts that the Bill does not propose any change in the level of resources for the joint bodies, although he is arguing for a commitment to more resources. That is a perfectly reasonable position to take. The hon. Member for Clydebank and Milngavie puts forward the quite different notion that the Bill inevitably means a cut in resources to the new organisations. It does not.

The hon. Member for Garscadden referred to the boundaries for the local enterprise companies in west central Scotland. I warmly congratulate my hon. Friend the Minister of State and my right hon. and learned Friend the Secretary of State on their decision to reject the approach by the Glasgow consortium to change the boundaries in the greater Glasgow area. I hope that the hon. Member for Clydebank and Milngavie agrees, as the proposals created as much criticism in Clydebank and Milngavie as they did in Eastwood. The consortium was entitled to put forward those proposals, but there was a strong reaction against them. If my right hon. and hon. Friends had taken the other course open to them, there would have been considerable disruption to the existing plans for those areas. The fact that it would have meant a split in my own constituency is perhaps a parochial point —there were wider considerations than that—but my right hon. and learned Friend knows the reaction from the Eastwood district council and we congratulate him on a sensible and swift decision that ended what would otherwise have been a period of uncertainty.

As always, the Scottish economy faces a period of change. It must adjust to the changes resulting not only from the single European market but from demographic factors. The number of 18 to 24-year-olds in Scotland is estimated to fall by about 20 per cent. by 1995. That is an additional reason to concentrate on improving our skills.

I join hon. Members on both sides of the House in paying tribute to the new towns. They have been a dynamic and progressive force for change in the Scottish economy. We all accept that new towns cannot be new towns for ever; eventually they must revert to being the same type of community as other towns in Scotland.

The hon. Member for Garscadden is right to say that many points need to be explored in Committee. However, that is not the point of this debate, which is about the principle of the Bill, and on the principle there can be no doubt about how the House should vote.

7.35 pm
Mr. David Lambie (Cunninghame, South)

Unlike some of my hon. Friends, I oppose the principle of the Bill and will vote against it. The whole concept of the Bill was introduced when an idea entered the head of Bill Hughes, a director of Grampian Holdings and a vice-chairman of the Conservative party. He used that idea to attack public sector organisations such as the Scottish Development Agency and the Highlands and Islands Development Board and to give a private sector lead to training and industrial regeneration in Scotland. Unfortunately, he took his idea to the Prime Minister, who was heard to say, "As Bill is one of us, I shall support it." It is unfortunate that as soon as the Prime Minister supported the concept our weak Secretary of State for Scotland was forced to accept the whole principle of the Bill.

I was surprised that the right hon. Member for Ayr (Mr. Younger) welcomed the principle of the Bill. I thought that at one time he was giving the funeral oration for the Scottish Development Agency, which will be killed by the Bill. I am willing to bet that if the right hon. Gentleman was Secretary of State for Scotland, the Bill would not be introduced now. He would have followed the policy decision of his colleague the Secretary of State for Wales to separate the Welsh Development Agency from the training facilities. I congratulate the Secretary of State for Wales on maintaining his independence. I am disappointed in the Secretary of State for Scotland and his Minister of State for just accepting the diktat of a person who has never shown any interest outside his own during his whole period as head of an industrial establishment in Scotland.

That is nothing new. Not only is the vice-chairman of the Conservative party in Scotland dictating to the Secretary of State, but the chairman of the Conservative party in Scotland is inside the Scottish Office as a junior Minister. However, I do not want to embarrass you, Mr. Deputy Speaker, by mentioning the hon. Member for Stirling (Mr. Forsyth) after all the trouble that the House has had today. The Bill has been designed by two people who do not represent the people of Scotland or the decent Conservatives—if there are any in Scotland—who will be affected by the Bill.

I was interested to hear the hon. Member for Argyll and Bute (Mrs. Michie) say that there is a movement of officials and employees out of the Scottish Development Agency,. They are not moving out of the Scottish Development Agency because they are confident about their futures when the Bill becomes an Act of Parliament. I have found as a Member of Parliament—I am sure that this applies to my colleagues—that when one tries to contact officials or employees of the Scottish Development Agency about various matters, I am told, "We are sorry, Mr. Lambie, that person is no longer here". People are taking early retirement or moving on into the private sector to take advantage of the facilities that will be afforded to the private sector when the Bill is enacted. Those in the Scottish Development Agency show no confidence in their futures, and neither will the employees of the Highlands and Islands Development Board.

Indeed, I am willing to bet—and I am not usually a betting man—that if the Bill becomes an Act of Parliament, Iain Robertson, the chief executive of the Scottish Development Agency, will also move on to new pastures. Knowing him in the past and his work both as a civil servant and as the chief executive of the SDA, I am certain that he will not put up with what will happen to the SDA when it is downgraded if the Bill is enacted.

To whom are we handing over the future industrial and training policies of Scotland? The answer is to the private sector—to the people who in the past have let down the people of Scotland over their industrial base and training facilities. Not so long ago Scotland and Scottish industry depended for its skilled craftsmen on our heavy industries. Unfortunately, we have few heavy industries left. Many of my hon. Friends represent shipbuilding or former shipbuilding constituencies. In the small town of Ardrossan, near where I stay, the Ardrossan shipyard is now closed. Every year it used to take on 100 apprentices and put out 100 skilled craftsmen to help the new companies coming into the area. The shipyards produced the skills, but they no longer exist and those that are still in operation no longer train apprentices. The same applies to the steel industry, the heavy engineering industry and the chemical industry.

The people who will man Scottish Enterprise and the local enterprise companies are the very people who at present are not prepared to train in their own companies. That is a general statement and there are one or two exceptions to it. I refer, for example, to the chairman designate of my local enterprise company, the Ayrshire enterprise company Mr. John Hornibrook, the works director of Roche of Dairy, a man who has spent his entire life trying to get the companies in Ayrshire to put money into training, without much success. Although there are one or two exceptions, the majority of people appointed to Scottish Enterprise and to the local enterprise companies such as those in Ayrshire will be appointed by the Government. Yes, they will be Government appointees, placemen of the Conservative Government, appointed to carry out the Conservative Government's policies.

I am sorry that the right hon. Member for Ayr is no longer in his place. I hope that the Minister of State will not appoint to the Ayrshire enterprise board some of the right hon. Gentleman's friends because as far as I can see they are not interested in training. Most of them are interested only in the honours list and in whether they will get the CBE or the OBE, which will be just another arm to their careers and reputations.

The only way in which we can achieve anything in training is by giving companies serious financial incentives to carry out their training obligations. We should also apply severe financial penalties to those companies which do not carry out their responsibilities, but which poach from companies that have spent money on training. If we do that, we shall make progress.

Both private and public industry should carry out their training functions and increase the number of their skilled craftsmen. However, they should do so without being incorporated into this new Government organisation.

Dr. Godman

I sympathise with my hon. Friend's serious reservations about privately led employment and training initiatives, because the Inverclyde Initiative, which is a privately led initiative, has done little or nothing for the people of the lower Clyde.

Mr. Lambie

I agree with my hon. Friend because I have experienced Taskforce and local enterprise groups. Because of the serious decline of employment potential in my area, I have always been a leader in trying to get some new Government initiatives. The hon. Member for Eastwood (Mr. Stewart) knows that when he served at the Scottish Office he helped me to set up the Ardrossan, Saltcoats and Stevenston enterprise initiative, which did little for the people in the area. However, such organisations certainly provided a lot of jobs for the people who will now be looking for jobs in the new organisations. It was always a case of jobs for the boys.

I shall vote against the Second Reading because the Government have included in the Bill their provisions to wind up Scotland's new town development corporations. Why? It seems strange that this Bill has two sections. One deals with the future of the Highlands and Islands Development Board, the Scottish Development Agency and the Training Agency, but that is joined with the provisions to wind up the new town development corporations in Scotland. Why are the Government doing that? The answer is because they do not have enough Tory Members of Parliament to man the Committees on two Bills. The Ministers are punch-drunk with not only defending themselves against the likes of Bill Hughes and the hon. Member for Stirling, but with defending themselves against the people of Scotland also.

Two totally different subjects are being taken together in one Bill because the people of Scotland are not prepared to vote for Tory candidates. If by some unfortunate chance after the next election the people of southern England vote Conservative again and we have another Tory Government in the United Kingdom, we can honestly say that there will be no Tory Members of Parliament representing Scotland. What will the Government do then? How will they man the Committees? What about the Select Committee on Scottish Affairs? The Government are in difficulties now, but they will certainly be in difficulties later if by some unfortunate chance the people in southern England are still as stupid as they have been during the past three general elections.

I represent the new town of Irvine. The people there are asking about what will happen to their housing when the new town development corporation disappears. My development corporation of Irvine will disappear in 1999 and I shall be lucky if I am around then. I shall certainly not be the Member of Parliament for Cunninghame, South then. By that time there will have been at least two general elections and we will have the possibility of a Labour Government. I say to the people in East Kilbride and Cumbernauld, whose new town development corporations are to be wound up quicker, that they might be caught before we have a new Labour Government, but by the time Irvine new town is wound up there will be a Labour Government and therefore the legislation being passed tonight will not apply to my area. The people in my area are asking what will happen to the houses that are still tenanted. There are more than 5,000 houses in Irvine new town: just over 1,000 have been sold and we are left with 4,000 tenanted houses.

Sir Nicholas Fairbairn

Who is left with them?

Mr. Lambie

I shall listen to you, Mr. Deputy Speaker, carry on and never mind the interjections by those who have just come in. The hon. and learned Member for Perth and Kinross (Sir N. Fairbairn) was one of the best members of the Select Committee on Scottish Affairs when I was its Chairman because he always did what he was told.

The people of Irvine are asking what will happen to those houses. I was interested that in answer to a question from my hon. Friend the Member for East Kilbride (Mr. Ingram), the right hon. Member for Ayr looked down at his colleagues on the Front Bench and said that people in the new towns would surely be given the opportunity of choosing to go to their local district councils. In my case that would be Cunninghame district council. The Minister did not look, nod or give any sign of agreement with the previous Secretary of State for Scotland. Unlike my hon. Friends, I will not wait until this matter is discussed in Standing Committee. If the right hon. Member for Ayr was correct and the Government are to give the tenants a choice of going to their local district councils, I want the Minister to say now that his right bon. Friend the Member for Ayr was correct.

The Minister of State, Scottish Office (Mr. Ian Lang)

If the hon. Gentleman can contain himself until my wind-up speech, I shall address the matter then.

Mr. Lambie

Usually, whenever we reach the wind-up speech we are told to wait until the Standing Committee. When one has been here long enough one has heard all these stories from Ministers.

Mr. Thomas Graham (Renfrew, West and Inverclyde)

My hon. Friend makes an important point. I assure him that I know what the Minister's answer will be. When the Scottish Special Housing Association existed, we constantly asked the Minister to give the SSHA tenants the right to ballot to decide whether they wanted to go to the SSHA or to their local authority. If that had happened in Linwood, Erskine or such places the folk would have voted overwhelmingly to go to their district councils.

Mr. Lambie

My hon. Friend makes a valid point. When the right hon. Member for Ayr was Secretary of State for Scotland he gave the guarantee that when the Scottish Special Housing Association was wound up the houses would be handed over to the local authorities. Previous Secretaries of State from both the Labour and Conservative parties said the same. We know that Scottish Homes was set up to replace the Scottish Special Housing Association and the Minister of State, Scottish Office, who is present, reneged on the agreement and a private company was set up to administer the houses of the Scottish Special Housing Association.

The people in the new town houses are afraid because Scottish Homes not only gives people the right to buy their homes, which the Labour party accepts, but has the right to sell houses on the open market when they become vacant. Therefore, instead of a reduction in the housing waiting list in the Cunninghame area—which is now more than 4,000, with just under 1,000 in the new town—homelessness is increasing as Scottish Homes begins to sell houses that were formerly in the rented sector.

In a survey carried out by the Scottish Office, 59 per cent. of the people of Irvine said that, given the choice, they would rather be tenants of Cunninghame district council. Only 7 per cent. said that, at the wind-up of the corporations, they wanted to be tenants of Scottish Homes. Yet the Government are to transfer, against the wishes of the people, houses to Scottish Homes if they have not been sold off to some other private enterpriser. I speak on behalf of the tenants of the IDC houses in the new town of Irvine and ask the Government to ensure that tenants of the houses that remain at the wind-up, which I hope will never come because by that time we will have a Labour Government, will be given the choice to go to their local district council.

7.55 pm
Mr. James Arbuthnot (Wanstead and Woodford)

The Bill contains the most important reforms of training and economic development since 1974, when the Manpower Services Commission was established, and since 1975, when the Scottish Development Agency was established. The Scottish Development Agency was established by a Labour Government, so it was refreshing when the incoming Conservative Government of 1979 did not abolish it, as was widely expected. Instead, they adopted, adapted and developed it in a way that showed flair and proved extremely successful. Perhaps that shows that the party divide then was not as great as it is now, which is fitting.

As has been generally recognised on both sides of the House, the SDA has been a success. It has a high reputation both inside and outside Scotland, and has an imaginative and dedicated staff. One reason for that success has been that it has moved away from a policy of throwing money at lame ducks and moved instead towards being vigorous and successful in helping Scotland to develop its sunrise, rather than sunset, industries.

Speaking as a Member for an English constituency, albeit a Scottish Member—

Mr. Ernie Ross

Will the hon. Gentleman, with his detailed knowledge of Scotland, tell us of any single lame duck at which the SDA threw money and to which he objected?

Mr. Arbuthnot

I was making the point that the SDA has moved away from that policy and towards different policies encouraging the new industries that Scotland has needed, rather than trying to throw money at the dying industries of coal and steel.

Mr. Ross

The hon. Gentleman has just made that up.

Mr. Arbuthnot

I have not made it up. The SDA has moved towards the new industries that Scotland will need to rely on in future.

England does not have a similar agency to the Scottish Development Agency, which has caused some envy in English circles. It does not have an organisation fighting for English enterprise, and perhaps it should. Clearly it is right that the responsibility for training in Scotland should be devolved in Scotland. That proposal is not opposed by any hon. Member. Training should not be dealt with in Sheffield as it is now, and there can be no argument about that.

The question then arises as to where training should be dealt with in Scotland. The advantages of transferring the responsibility for training to the Scottish Development Agency are considerable. A single organisation, providing an integrated system of enterprise promotion and training, is more likely to produce the skills that business men need than would a separate body.

Another problem is that the demographic decline as a result of the end of the post-war baby boom—I lay claim to being part of that boom—will cause an extreme shortage of skills in Scotland. In the United Kingdom we are facing a shortage of skills which, unfortunately, is not faced by our competitors. That makes it all the more important that we should enhance the skills of the young people whom we have, quite apart from any natural desire to do that in any event.

It is vital that the training of our young people should be inextricably linked to the jobs that they will be required to do. It is right to transfer responsibility for that training to Scotland and to the body most closely concerned with investment in Scottish enterprise, and to treat the training not just as another investment but as the most important investment in Scottish enterprise.

For that reason the general secretary of the Scottish TUC welcomed the integration of training and development, and it is hardly surprising that the chairman of the Scottish Development Agency said: We welcome, we endorse and support the visions and the principles in the White Paper. The SDA is throwing its full weight behind Scottish Enterprise and, in particular, the proposals that training and the development function should he integrated.

Mr. Graham

Does the hon. Gentleman realise that there is to be no new money for training in Scotland, yet private industry has an appalling record on training and the creation of apprenticeship? Not long ago the Evening Times, a well-known Glasgow paper, carried an article on the serious problems to be found in training schemes run by private companies. They were a disaster. One of my constituents, who is supposed to be training for his HGV licence, has been running about as a chauffeur, carrying private employers all over the place. That is not what he should be doing. We need new money to ensure that training can happen and that apprenticeships develop. Private industry will not lead the way. We need to see a better input from the Government.

Mr. Deputy Speaker (Mr. Harold Walker)

Order. Interventions should be brief.

Mr. Arbuthnot

Hon. Members on both sides of the House have recognised the need for a far greater emphasis on training than in the past. I am not clear whether the hon. Gentleman believes that only the Government should be responsible for training or that industry should place more emphasis on training. In 1978–79 about two thirds of the money that went into the Scottish Development Agency came from the Government and the other third came from business and the economy that it produced.

In view of the wide support for the changes that are being introduced in the Bill, in view of the support of the Churches, the trade unions, the SDA and the vast majority of the 420 representations that have been received, it is more surprising that the party, or parties opposite—I have now heard the Liberal party's view—have set their faces so firmly against it and, as my right hon. and learned Friend the Secretary of State said, have stood in splendid isolation in opposing the Bill.

Mrs. Fyfe

Is the hon. Gentleman aware that the Scottish TUC is so concerned about the plans for training in Scotland that it has proposed setting up an independent body to monitor the carrying out of that training because it cannot trust the Government to do that properly?

Mr. Arbuthnot

The STUC has generally welcomed the Bill. Obviously, it disagrees on some issues, as do many others who have produced representations generally in support of the Bill. But the broad feeling in Scotland is that the Bill and the White Paper are along the right lines. The Labour party is sadly isolated if it says that the principle of the Bill is flawed. But is the Labour party saying that? Do Labour Back Benchers agree with the suggestion of the hon. Member for Glasgow, Garscadden (Mr. Dewar) that the Bill should be opposed? When my right hon. and learned Friend asked whether it was the detail rather than the broad principle of the Bill that was objected to, the hon. Member for Fife, Central (Mr. McLeish) nodded his head. In that case, he and his colleagues should examine their conscience, support the Bill on Second Reading and propose detailed amendments in Committee. If they do not do that, they will risk being accused of petty opposition for the sake of it, and rightly so. They also risk being trampled in the rush of local authorities and local trade unions eager to take part in the local enterprise companies. They are putting forward applications to take part. If the Labour party is not to be trampled in that rush, it should consider changing its stance. The local trade unions and local authorities are eager to endorse the principle of this excellent Bill.

8.5 pm

Mr. Adam Ingram (East Kilbride)

I do not intend to comment in detail on part I of the Bill which deals with Scottish Enterprise, but I fully endorse the points made in relation to that by my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar). I represent the first Scottish new town and I have lived in East Kilbride for the past 20 years. Therefore, I want to confine my remarks principally to part II, which deals with the winding up and dissolution of the new town development corporations.

The residents of the new towns expected and deserved something better than an imprecise three-clause addition to another piece of legislation, sneaked out in an unacceptable way over the Christmas and new year holiday period. The way in which that was done, and the lack of detail contained within the measure relating to the new towns, treats the 25,000 people who live in the new towns with nothing short of contempt.

The Secretary of State and the Minister with responsibility for the new towns appear to forget that Scottish new towns are places where people are born, brought up, and educated and in which they live and work. They are total communities in which one in 20 of the Scottish people live and work.

Why have we not been presented with a proper piece of legislation which takes account of the ongoing housing needs of the new towns? Why have we not been presented with a Bill which takes account of the benefits gained by having the overall community environment planned and run by bodies with a degree of democratic accountability? Why have we not had a piece of legislation which recognises the economic benefits to be gained from having a democratically accountable body responsible for the economic development of the new town areas? Why should five new towns find themselves being privatised and run differently from every other town, city or community in Britain?

Two key areas give major cause for concern—housing and economic development. The future of new town tenants and those who would have expected to be housed by the new town development corporations in the future remains decidely uncertain. The real fears and worries of tenants will be increased by what the Bill does not say as by what it does say.

As other hon. Members have said, in the past year the Government have commissioned an independent survey on the attitudes of new town residents to housing choice within the new towns. It makes salutary reading. I shall not go into that in detail, but I want to take one prime aspect. In reply to one question, two thirds of tenants said that the district council would be their preferred landlord on wind up. Only 8 per cent. said that they would choose a housing association, 9 per cent. a housing co-operative, 5 per cent. Scottish Homes and 1 per cent. a development corporation buy-out. No one said that they would choose a private landlord. That is a clear expression of tenant choice—something that the Government claim is their overriding and highest priority.

If the Government are so committed to tenant choice, why does not the Bill contain a simple clause stating that at any time prior to or during the winding up process tenants' wishes will be respected and that they will be able freely to choose their own landlord? One simple clause would put at ease the worries of all tenants living in development corporation houses. I suspect that such a clause was not inserted because the Secretary of State and the Minister knew that tenants would choose their district councils and did not-want to offer them that choice.

At present, development corporations in East Kilbride, Glenrothes and Livingston are planning to transfer their housing stocks to private management agencies, and they have not asked tenants for their views on that development. Recently I tabled a parliamentary question asking the Minister whether he would be prepared to advise or instruct development corporations to consult tenants prior to any transfer to management agencies of new town housing stock. His simple and stark answer was no. Tenants are being given little choice, and the management structure is being transferred over their heads.

We are left with a public housing authority that takes no account of tenants' wishes, and a Secretary of State and Minister who are not prepared to defend tenants' interests. When the Bill is enacted, I envisage the Secretary of State establishing in each new town an office on whose door will be the sign "Tenants' choice—no inquiries please." Even the people of Romania are not prepared to put up with that kind of thing any more. What is happening even before the Bill is on the statute book will occur to an even greater and more dramatic extent when it is law. Tenants will have the choice only of accepting what the Government say is right for them—and if they do not like it, they can get out. I refer to people who have lived for years and decades in new towns, and who have brought up their families there and are now seeing their children marry and bringing up their own children.

The Bill is silent on which body will be responsible for new towns' ongoing housing needs. Existing new build programmes are inadequate to meet the current requirements of new town areas. The situation has deteriorated steadily over the years and seems likely to become an even greater problem in the years ahead. Figures from Shelter reveal an alarming increase in the number of homeless and the extent of waiting list problems in new town areas. In my own new town of East Kilbride, the number of homeless doubled in the seven years between 1981 and 1988—increasing from just over 2,000 to more than 4,000—as a consequence of Government policies. No one else can give development corporations the authority to build new houses. Such instructions have not been forthcoming in recent years, even with the lifting of the moratorium after considerable pressure was placed on the Scottish Office by Scottish local authorities and tenant representatives.

The Bill makes no provision either for local authorities to fulfil their statutory obligations to the homeless and to other special needs groups. The proper solution would be to provide for a transfer of the relevant special needs housing stock to district councils. That would set to rest the worries and fears of those already living in special needs housing and the many on the waiting lists for such accommodation—as well as of the many thousands of homeless in new towns who are searching for a home within the community but cannot obtain one because of circumstances outwith their control.

There is no mention in the Bill of the way in which the relative success of new towns in recent years will be maintained. Other hon. Members have mentioned that in recent years 40 per cent. or more of inward investment in Scotland has gone to new town areas. That success is built on long-term planning, investing for the future, and the careful use of public assets in developing new town areas. Those assets have been developed at considerable public expense and managed successfully over the years through a form of democratic accountability in partnership, to a greater or lesser extent, with local authorities. That formula for success and the experience that has been built up will now be cast aside.

Although the Bill says nothing about the successors to the development corporations, the White Paper does. It makes it clear that the successor bodies will be run on a private sector basis and will be profit driven. Instead of the existing bodies dedicated to long-term development, there will be groups of entrepreneurs with an eye on the main chance and a fast buck who will be more dedicated to getting what they can out of new towns—probably by asset stripping—than to what they can put into them. Now is the wrong time—with increasing competition for inward investment not just within Britain but across Europe, and for economic development—for the Government to throw away the major business expertise that exists within new towns and to dispose of well integrated, developed and properly planned industrial and commercial assets to the highest bidder. Even then there is doubt as to whether they will go to the highest bidder.

The Bill's failure to provide for local authority involvement in the successor bodies also gives cause for concern. Local authorities will have a role, albeit minimal, in Scottish Enterprise and in local enterprise companies, but they will be denied a similar involvement in local development boards. Why should that be so? Why should local authorities or democratically elected councillors be denied a place on the local enterprise boards, when there is acceptance that at least some form of local authority representation should be permitted in respect of local enterprise companies? In the case of East Kilbride and Glenrothes, there is a fear that the development corporations will be wound up before Scottish Enterprise is up and running and has a chance to establish itself. To subject new towns to a changing and uncertain environment could prove disastrous not just for their areas and their wider communities but for the whole of the Scottish economic scene.

Everyone associated with new towns takes pride in the housing, social, industrial and commercial environment that they provide. Those of us who live in new towns are proud to do so, but nothing in clauses 30, 31 and 32 gives cause for hope in their future. Those three clauses are analogous to the three-card trick, but instead of it being a case of finding the lady, it is a matter of finding the Government's commitment to democratic accountability and freedom of choice. We all know what happens to the lady in the three-card trick: it is shown briefly and then palmed by the con man.

Fortunately, the people of the new towns will not be conned by the Secretary of State. They know that they will not have even a chance of glimpsing freedom of choice in respect of housing or democratic control over their communities' commercial and industrial assets. That is why the people of the new towns strongly oppose the Bill and why I, as a new town Member of Parliament, give them my full support.

8.18 pm
Mr. Alex Salmond (Banff and Buchan)

The debate had an unusual start, when the speech of the Secretary of State for Scotland was disrupted by the hon. Member for Tayside, North (Mr. Walker). I was glad that the hon. Member for Tayside, North did not get shown the red card —not so much because we would have missed his speech later but because, rather embarrassingly, I would have been constrained for the first time to support Mr. Speaker's ruling on such a matter.

The right hon. Member for Ayr (Mr. Younger), making one of his first speeches as a Back Bencher on a Scottish subject, paid a handsome tribute to the work of the Scottish Development Agency, the Highlands and Islands Development Board, and new town development corporations. His tribute was so handsome that I wonder why he so enthusiastically supports legislation that abolishes those institutions. That is an important point. Opposition Members are entitled to be certain, before we endorse or support the legislation, that what replaces those institutions will be more effective than the SDA, the HIDB and the new towns have been. Criticisms along those lines are not carping and minor but substantial and major.

There is no doubt that the legislation has been oversold and that occurred from its genesis when the progenitor of the scheme, Mr. Bill Hughes, the vice-chairman of the Conservative party in Scotland, boasted that it would eliminate Scottish unemployment within a matter of years. If claims of that sort were to be brought to fulfilment, there would have to be something in the scheme—either in its finance, its function or its performance—that would allow such extravagant claims a semblance of reality. If we consider the issues in turn we will find nothing in the legislation that could meet such an ambitious target.

As other right hon. and hon. Members have pointed out, no new money is being made available for investment work or training in Scotland. The best that can be said is that finance under the legislation will be broadly equivalent to what is available at present. There is a real danger that a diminution of finance is on the agenda. One might reasonably expect that private employers taking a larger funding role in training in the future is part and parcel of the Government's logic of privatisation of the training services.

Opposition Members are entitled therefore to ask for guarantees that the hints of an expanded budget that the Secretary of State for Scotland was prepared to give in a television programme will be transformed into legislation. Perhaps, when the Minister replies, he will tell us what will happen to the funding pattern of the SDA, the HIDB and training under the Scottish Enterprise proposal.

Nor is there any great change in the functions that will be undertaken by the new system. The Secretary of State has made great play of the devolution of the training services to the new Scottish Enterprise organisation. As other hon. Members have said, when one analyses those training services, one sees that 95 per cent. of the funding will remain dominated by programmes determined by the United Kingdom Department of Employment. All the Secretary of State had to say when he was questioned about whether that represents a "Scottish solution to Scottish needs" was that it would be a problem if Scottish qualifications were different from those in England. Does that not also apply to the present Scottish education system? There does not seem to be any problem with Scottish labour mobility into England—just the opposite. The key priority is that training qualifications should be appropriate to the needs of the economy in which they function.

If the scheme was a genuine Scottish solution to Scottish needs there would not be a superficial devolution of training programmes but the right to evolve training programmes that are appropriate to Scottish conditions.

When we consider the likely performance of the new agencies, we are entitled to ask why the new set-up will be better than the old one. For example, the Scottish Development Agency has just undergone a major reorganisation and decentralisation of its functions. How will the investment function of Scottish Enterprise perform better than the SDA, with a similar decentralisation by area?

A number of hon. Members have criticised certain aspects of the SDA's performance in the past, but on the whole, and one can only judge these things in that way, it would probably be the virtually unanimous view of the House that the SDA has performed well under the circumstances. Why should we expect the new organisation to perform its investment function better than the SDA or the HIDB did in the past?

We already know that 95 per cent. of the training schemes will be United Kingdom dominated. The Government are placing their faith in the intervention and introduction of private sector employers into the organisation. They will dominate local enterprise schemes by a ratio of two thirds to one third. What is the training track record of that section of the Scottish community and why does it lead us to expect that their performance within Scottish Enterprise will be dramatically better than their performance within their own companies? The Government claim that they have a consensus on the proposals, but I do not see that one exists. There is certainly a consensus in favour of devolution of training to Scotland, but, as Hamish Morrison, chief executive of the Scottish Council has said, that is "more apparent than real."

There is a large measure of agreement that there should be integration of training and investment because they are closely interrelated. However, that should not mean that the existing institutions—the SDA and the HIDB—should have to be dismantled. Why was it not possible to use the new area structure of the SDA as the basis for the new organisation, and, underneath that, along the model of the present local enterprise trusts, have agencies that would deliver local training needs from the training budget?

In my constituency the proposal from Banff and Buchan Enterprise made the important point that training needs are not likely to be identified best on a Grampian level. They are more likely to be identified in the same way that local enterprise trusts identify them at the moment —at a really localised level with detailed knowledge of the local economy. We could have kept the best aspects of the SDA and its structure as well as integrating the training requirements.

Any agreement in principle that there may have been at one time about the proposals has been shattered by the total imbalance in the structure of the proposed organisation. There is a real danger and a suspicion that these proposals will mean the replacement of the professionalism of the SDA with the patronage of the Conservative party.

The Secretary of State for Scotland said that he does not appoint local enterprise companies. That is true. He appoints the committee that vets the local enterprise companies. He also appoints Scottish Enterprise, which monitors the performance of local enterprise companies. Therefore, there is a real danger that that is effectively an extension of Scottish Office patronage into an area which, in the past, was administered professionally.

The SDA and the HIDB are the latest in a list of Scottish institutions that have been attacked by a range of policies. Education local authorities and the Health Service have also been subject to reorganisation and restructuring, often for no good reason, at the hands of the Government.

We should consider why the two thirds bias towards the private sector is wrong. First, it is wrong because it fails to realise that local employers are in competition for scarce labour resources. Take the Grampian example. There will be a maximum of eight private sector local employers in the new Grampian Enterprise organisation. What about the many other private sector employers within the region? Will they not have any input into the organisation? Secondly, the scheme devalues the role of local authorities. They are not just major employers; they are major providers of training services through local authority colleges. Again, in the Grampian example there is a maximum of four places available to non-private sector sources. Therefore, the odds must be against even one councillor from, say, Banff and Buchan becoming a member of the new organisation. The proposals belittle the legitimate training role of local authorities.

The third problem is the lack of effective trade union representation, particularly in training. There is a potential conflict of interests between employers, and between employer and employee. The union movement should be properly represented to ensure that people are confident that they are being trained to enhance their skills, and not because it suits one part of the private sector. There will be no consensus support for the Bill until the present proposals, which are biased in favour of the private sector, are replaced by proposals that provide for a genuine partnership between private sector, local authorities and trade unions.

I agree with much of what was said about new towns by the hon. Member for Cumbernauld and Kilsyth (Mr. Hogg), although I cannot endorse his architectural attack on the Scottish National party. In view or his past comments on such matters, the hon. Gentleman probably did not give us the complete picture of Cumbernauld's architecture, and in any case I do not know a great deal about that subject.

One of the tenants who lobbied hon. Members today gave me a copy of a letter sent on behalf of the Minister of State in June 1988. The letter dealt with the position of new town tenants following the abolition of the new town corporations, and stated—as Ministers have stated before —that the Secretary of State will take full account of the views and wishes of the tenants concerned before reaching his decision. Various surveys and expressions of opinion have made two things clear. First, in general the district council represents the most favoured landlord for new town tenants; secondly, private sector landlords were the least popular choice—so unpopular, indeed, that they barely registered in the surveys. I feel that we are entitled to a definite statement that each new town tenant will at least be given the option of moving into district council tenure when the new town corporations are finally wound up.

Significantly, the former Secretary of State, the right hon. Member for Ayr, did not seem to be aware of the amount of evasion, convoluted logic and survey-rubbishing in which the Minister of State has been engaged. The Minister's statements have led us all to suspect that district council tenure is the last option that he wants to offer, but we believe that the new town tenants should be given the freedom of choice that they were originally promised.

I want to make two specific comments on the Scottish Enterprise legislation, followed by a more general point. First, have the Government considered the fact that European social fund applications are processed through the Department of Employment? Will that task be devolved to the Scottish Office, to the SDA or to Scottish Enterprise?

Secondly, let me ask on behalf of my hon. Friend the Member for Moray (Mrs. Ewing) whether the Government have considered the anomalous position of her constituency and Moray district. At present, some 25 per cent. of population is in the Highlands and Islands Enterprise area, with about 75 per cent. in the Scottish Enterprise area. My hon. Friend argues that the whole of her constituency and district should be brought within the Highlands area, with the important proviso that funding should take account of the increase in population.

Finally, let me make my general point. There is no doubt that labour supply factors can be important to economic success, and over the next two or three years certain industries in Scotland are likely to face severe labour shortages in jobs that require key skills. Construction is an obvious example, because of the current oil boom. Economic structure and demand are also important, however. I wonder whether the Secretary of State or the Minister watched a BBC television programme last Friday in which a successful Scottish business man, Mr. David Murray, was asked for his views on the outlook for the next decade. Far from replying that he believed that the Scottish Enterprise proposals would lead to some great Scottish economic renaissance, Mr. Murray expressed regret about the erosion of indigenous ownership in the Scottish economy, and pointed to the damage done to Scotland's economic prospects by penal interest rates that are designed not for Scottish economic conditions, but for the overheated economy of the south-east of England.

Until we have a real economic policy that provides a genuine Scottish solution to Scottish needs, the Scottish Enterprise proposals will be at best irrelevant and at worst damaging.

Several Hon. Members


Mr. Deputy Speaker (Mr. Harold Walker)

Order. Four hon. Members have sat here for a long time trying to catch my eye. I understand that the Front-Bench Members wish to reply to the debate at 9.20 pm, which leaves 43 minutes. I hope that the arithmetic will not be lost on hon. Members.

8.37 pm
Sir Nicholas Fairbairn (Perth and Kinross)

I think that hon. Members on both sides of the House will agree that we have heard a rare speech from the hon. Member for Banff and Buchan (Mr. Salmond), a Scottish National Party Member. It was not constructive; we would not expect it to be. It was not instructive either. What was rare about it was the fact that it was not even destructive, and I am sure that we all learnt very little from it.

I was impressed to note that the only titter that we have heard throughout the debate came from Labour Members when the hon. Member for East Kilbride (Mr. Ingram) said that even the Romanians would not stand for the Government's proposals. Let us not forget the principal new town housing policy of President Ceausescu: he bulldozed all the villages and forced people to live in Socialist new towns. I have just returned from a visit to the Socialist new towns of Warsaw, Witowice in Czechoslovakia and East Berlin, and I can understand why the Romanians would not want Socialist new towns. I was horrified by what was said by the hon. Member for Cunninghame, South (Mr. Lambie) about human beings who had had the effrontery to buy their own houses. His remark may well rank in the history of Socialism, along with "We are the masters now": he said that "we" had been left with only 4,000 houses.

Who are "we"? Are not houses meant to belong to people? Why should we arrogantly assume that they wish a Socialist organisation, which has been left with only 4,000 houses, to be perpetuated?

Dr. Godman

There are only 4,000 left.

Sir Nicholas Fairbairn

There is only one in my constituency. Why does the hon. Gentleman say that only 4,000 are left? I pay tribute to him for his kindness and his compliment to me in allowing me to be a member of his committee, even though my peccadilloes were always put into shadow by his own.

The hon. Member for Dundee, West (Mr. Ross) made an interesting point when he asked us to give an example of a factory or industry that had not been destroyed in Scotland. He should be the last person to ask such a question. Ron Todd prevented the most important modern factory that Scotland could ever have had from coming to Dundee.

The Opposition want bureaucracy to continue in its most strangling form. The successes which the Minister of State and my right hon. and learned Friend the Secretary of State have brought about for the Scottish Development Agency will be increased by the Bill. Enterprise companies in Perthshire and Fife are enthusiastic about the Bill, but they are frightened that the regional councils or the Socialist district councils will attempt to make the magnet of the city of Dundee do down the city of Perth. We want the enterprise companies to benefit small towns and villages in Scotland by developing tourism and trade.

The most essential element for future employment is training. I read the Dumfries Courier every day. It is the only newspaper that still carries advertisements on its front page, with the news in the middle. Each day there are probably two advertisements in the "Situations Wanted" column. There are probably 200 advertisements in the "Situations Vacant" column. At the other end of the newspaper there are sophisticated advertisements, usually between 50 and 100. The reason for that large number of vacancies is not because people do not want to work; it is because we do not have trained people to do the work that is available. It is work that they would like to do.

People need to be trained and encouraged to be flexible so as to be able to adapt to changes in working practices. The development of skills is the most important manifestation of education in all its variety. The Bill combines training with what is, for Scotland, a unique benefit—one Government agency to which any person who wishes to invest in Scotland can go, knowing that everybody whom he will need to consult will be under the same roof. He will not have to visit different departments and different officials, as happens in England.

I was in New York last year where I helped to promote the Scottish trade exhibition. American business men told me that, apart from Scotland, there was no place in Europe to which they could go where they would meet under one roof all the people that they needed to see. If training is to be combined with the Scottish Development Agency, we shall be able to attract industry to Scotland. Industrialists will not then prefer to go to other European countries.

8.45 pm
Mr. Ernie Ross (Dundee, West)

The hon. and learned Member for Perth and Kinross, (Sir N. Fairbairn) made a rather obscure reference to his hon. Friend the Member for Wanstead and Woodford (Mr. Arbuthnot). The hon. Member for Wanstead and Woodford publicly insulted the Scottish Development Agency by saying that in the past it had supported lame ducks. I invited him to name one of the lame ducks that the SDA had supported. We do not know what would have happened in the case mentioned by the hon. and learned Member for Perth and Kinross, because the SDA was not involved. It can hardly, therefore, be described as a lame duck; it never even got there. However, I invite the Minister to give an example of one of the lame ducks that the SDA is supposed to have supported. I am not aware of any lame ducks. I am sure that the SDA would feel insulted if it thought that it was supporting lame ducks.

The Bill will lead to the axing of one organisation that has a good track record in Scotland. It was the envy of English Members of Parliament on the Employment Select Committee who toured Scotland with me last year and examined the work of the SDA and other agencies.

The SDA has been investigated regularly by the Treasury and the Industry Department for Scotland. According to the most recent investigation, published in February 1987, the SDA's high standing with the Scottish business community and financial institutions, the generally supportive attitudes of the local authorities and its reputation beyond Scotland are also indicative of the Agency's performance … What the Agency primarily supplies is an integrated delivery mechanism … At a time of continuing rapid structural change in the Scottish economy, there remains a real advantage in having a flexible economic development instrument directty answerable to the Secretary of State … Conversely, the Agency's position at arm's length from the Government has contributed to its achievements, notably in its ability to form constructive partnerships with local authorities and to adopt a distinctive action-orientated and opportunistic style of operation. According to a training organisation based in Sheffield, just under a quarter of all employers had a training plan in 1986–87. However, the SDA, which has taken positive initiatives in Scotland, is to be brought under the control of people who are training fewer than 50 per cent. of their employees. A clear case can be made for the SDA to be allowed to carry out its own distinctive role, according to the devolved form of management that the agency devised for itself last year.

A particular Scottish influence needs to be reflected in any training policy. The Secretary of State sought comfort in the support of the STUC, but he failed to tell the House that the STUC had said that if training in Scotland was to be taken seriously, it had to reflect the Scottish experience and not simply be dictated by the national policies decided by the Secretary of State for Employment. We know all about that in Scotland. Dundee was used for pilot projects for the many schemes which failed miserably. That is why the Government had to look outside Britain and to the United States for examples of how to organise training.

There have been various references to who was the author of this or that policy. According to the Scottish Office, when the Employment Select Committee was in Scotland in June 1988, The genesis of the White Paper resulted from a suggestion by Bill Hughes of the CBI (Scotland) about the benefit of bringing together the SDA and the training agency. This attracted the attention of the Prime Minister and"— —someone whom I cannot identify— was asked by the Secretary of State for Scotland to look at the suggestion. The Prime Minister explicitly adopted the proposal in a speech made to the CBI (Scotland) in September. That is just a pile of nonsense. What really happened was that the former Secretary of State for Employment, the right hon. Member for Sutton Coldfield (Sir N. Fowler), visited the United States, doing the same tour as the Select Committee, saw private industry councils in America and picked up the idea of getting women back into employment by paying for child care. We are tired of hearing that the Government invented that idea as well, because we all know that it came directly from employment practices in the United States.

Although I do not think that I shall be on the Standing Committee, I hope that it will examine the experience in the United States. The Committee will need to consider the successes and the failures. There are always successes such as Bill Hughes' brilliant idea, although when my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) led a delegation to meet Mr. Hughes, who is also a director of Grampian Holdings, we knew more about the training initiative than he did. It appeared that he had not been paying attention to Kay Stratton who had worked for Senator Dukakis in Boston and who had brought the idea over when she became a personal adviser to the former Secretary of State for Employment. Obviously he listened briefly to Kay Stratton and then had to be filled in later by the person who worked on the proposal so that the Prime Minister could make the speech to the CBI in Scotland in September.

Initially private industry in America sent minions instead of chief executives to private industry councils in America which took off only when the chief executives became involved. The United States became aware of the demographic time bomb and realised that they needed to get people back into employment. They needed the people whom the American system had failed—the blacks, the ethnic minorities and the women. That is why they began those projects. In the mid-1980s corporate conscience was developing in the United States. Corporate conscience meant that capitalists, instead of looking at the figures at the end of the year to ensure that a firm's accounts were in the black, were quite prepared for it to slip slightly into the red if it was spending money on training people and bringing them back into employment to ensure that the company would prosper in the years when there would be a gap in the work force because of the demographic time bomb and the flattening-out of the baby boom.

I hope that the Standing Committee will look at the experience in the United States. There are good and bad examples, but, without some guarantee of a corporate conscience, some of the local enterprise companies will make the same mistakes that were made in the United States.

The private industry councils in the United States showed great concern for ethnic minorities and for those who had fallen through the safety net. When the Employment Select Committee went to Scotland, we examined the failure of employment training to deal with those young people who used to be called "mode B" youngsters on the YTS. They ended up on community programmes having to be employed by organisations such as Goodwill Enterprises. The Select Committee saw no real evidence that the young people who were disappearing from the community programmes like snow off a dyke on a summer's day were being picked up by other schemes. Given the employers' domination of local enterprise companies, they are hardly likely to be concerned with training people without the necessary basic skills. When the Minister replies to the debate, we need to hear that the Government are concerned and have particular proposals for dealing with that problem. The private industry councils in the United States had to concentrate on that if they were to be meaningful in the community.

My hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) referred to the role of the Scottish tourist board which gave evidence to the Employment Select Committee on 13 December 1989. When I asked Tom Band and his colleague what they had done to ensure that there would be sufficient representation from the tourist boards and the tourist industry in the local enterprise companies, he said that one or two people were involved in Scottish tourist board activities. However, the Highlands and Islands Development Board and the Scottish Industry Department's evidence to the Select Committee on tourism make it quite clear that tourism will be the main employer in certain parts of Scotland. Someone who concentrates on tourism obviously has different concerns from someone who concentrates on industry. We must be assured that the needs of the tourist industry in Scotland will be recognised by the local enterprise companies.

I know that a number of my hon. Friends are still trying to catch your eye, Mr. Deputy Speaker, but I should like briefly to return to one of the most important aspects of training. Earlier, I asked the Secretary of State for Scotland a question, which cleverly he did not answer; the Minister of State, Scottish Office may do so when he replies to the debate. The difference between local enterprise companies and the training and enterprise councils in Scotland and England is the performance contract. In the United States, before training managers are paid, the people whom they train must be in employment. We need to know from the Minister whether the local enterprise companies will have to agree such a contract with the central board before they gain control of training finance. If we are not given that guarantee, there will be serious doubts about whether that training will be meaningful.

8.59 pm
Mr. Mike Watson (Glasgow, Central)

One of the main failings of the Bill is that it represents an abdication of responsibility by the Government. It seeks to encourage others to carry out training rather than the Government financing it themselves. That will not surprise those who have watched the Government in recent years. None of the United Kingdom's main competitors does not have a major responsibility for publicly funded training. They know the value and importance of training in an advanced and advancing economy, but it appears that the Government are content to leave that vital function, like so many others, to the vagaries of the market.

United Kingdom employers—and Scotland is no exception—have shown over many years that they have little inclination to take training seriously, at least when it costs them money or lost production. Unfortunately, that applies evenly across the spectrum in Scotland, from manufacturing industry to the service sector and particularly to insurance companies. Given the low priority that the private sector consistently gives to training its work force, on what basis can it or should it be assumed that it can be galvanised to take on a leadership role in training provision?

The Secretary of State was quite happy to refer to the support of the Convention of Scottish Local Authorities, but it said: Scottish employers … have been unwilling to invest in training programmes; they have not taken a pro-active role in respect of the unemployed; and they have not been prepared to assist in long term planning. It is unlikely, therefore, that employers will be able to deliver on their own the strategy as outlined by the Government. Yet, quite perversely, the private sector has been given an in-built guaranteed majority on Scottish Enterprise and Highlands and Islands Enterprise and on the local enterprise companies.

Surveys in Scotland have shown that fewer than one in three employers have a training plan or training targets, yet they are to be given two of the three places on local enterprise committees. They have clearly illustrated an inability to plan or even to appreciate the value of training, yet they are to be entrusted with the responsibility for planning and implementing training programmes for entire communities or areas. If there is a logic in that, it is beyond my wit to find it.

Local authorities, education departments, trade unions and voluntary bodies make no provision to ensure that they are able to make the positive contribution that they are clearly qualified to make. Indeed, the voluntary sector in Scotland currently provides one third of all employment training places involving a budget of more than £40 million annually. Surely such expertise should be taken advantage of, or treated as the undoubted resource that it is, to allow the voluntary sector a guaranteed role in the local enterprise companies. Surely it should be regarded as a partner, not a client. To do otherwise is simply wasteful.

Local authorities in Scotland have promoted economic development with conspicuous success in recent years. The Glasgow eastern area renewal, the Dundee project and the Govan initiative, which were all mentioned earlier, are good examples of local economic regeneration and the creation of jobs on both sides of Scotland. They are examples of projects in which vast investment was demand-led and often involved the channelling of resources to areas of deprivation. Where is the incentive in this legislation for the private sector to channel investment into such areas? The White Paper made no mention—nor, as far as I could detect, did the Secretary of State—of the long-term unemployed, many of whom are poorly educated, live in poor housing and feel alienated from the real world. Who will want to invest in them?

That begs the question about the intention of the Bill to tackle the chronic problem of long-term unemployment, which has been mentioned too infrequently in the debate. It seems much more likely that the local enterprise companies will be content to churn out trained workers for the hi-tech industries. To do that would he to betray the thousands of Scots who desperately want real training to enable them to re-enter the job market. Unemployment remains a major blight on Scotland's economic landscape. That is especially true of youth unemployment, which, in the west of Scotland, stands at 25 per cent. One in four of all young people seeking work cannot find it.

For that reason, how employment training and the youth training scheme will be dealt with under Scottish Enterprise needs urgent clarification. The employment training scheme continues to be virtually ignored in Scotland, where employers have almost no interest in it. When they have taken it up, it has been well exposed in the media that there have been many abuses of public funds and of the training needs of thousands of Scots who find themselves used as cheap labour. The Secretary of State should spell out clearly whether local enterprise companies will have the right to opt out of employment training and the YTS in favour of real training initiatives or whether, as many of us suspect, they will be welded irrevocably to the United Kingdomwide task force of the Secretary of State for Employment, which fails completely to take account of local needs.

The establishment of Scottish Enterprise will mean the disappearance of the Scottish Development Agency. It is clear that over the past 10 years the Government have found it difficult to accept the successes that the SDA has achieved. The roots of that go back to 1975, when the SDA was established by the Labour Government, which is clearly a sore point for those currently in control at the Scottish Office. Having cut the funding of the SDA by 25 per cent. in real terms over the past decade and still having failed to damage it seriously, the Government have resorted to getting rid of it by subsuming it in Scottish Enterprise.

In doing so, the Government are discarding wantonly several vital assets. As we have heard today, many of the high-calibre staff of the SDA have been leaving for some time because they are dismayed by the prospects that face them under the Bill. Even more damagingly, the establishment of Scottish Enterprise and the local enterprise companies will destroy the strategic Scotlandwide analysis of economic development, leaving a dangerous vacuum at the centre. The central role that the SDA has carried out successfully will also be lost. The Convention of Scottish Local Authorities, in its submission, to which the Secretary of State referred, said: the convention's view is that the national bodies should retain sufficient responsibilities centrally to provide the strategic context for the rational and effective development of the LECs. That is a vital resource, which should not be allowed to be discarded.

A more tangible disposal of assets can be seen in the decision to dispose of the portfolio of investments that the SDA has assembled to underwrite its initiatives. Taken in totality, the plans represent nothing less than a criminal waste of talent and resources for the people of Scotland. Unfortunately, they are yet another example of the Government's narrow thinking in an area where additional public resources channelled to those with expertise and experience allied to the necessary will could have achieved so much more.

In his opening remarks, the Secretary of State encouraged Opposition Members to amend the Bill in Committee. It remains to be seen whether it will be possible to insert some safeguards or whether, as has so often been the case, the minds of the Secretary of State and his colleagues are already firmly closed on this issue.

9.8 pm

Mrs. Maria Fyfe (Glasgow, Maryhill)

Earlier today I asked the right hon. Member for Ayr (Mr. Younger) how he expected that we should get enough employers from a sufficient variety of enterprise to conduct training when the unemployment level in some areas was so high. I reminded him that unemployment in Glasgow was especially high. I must add now that the current unemployment level in Glasgow is 52,000. In Scotland as a whole, there are 40 travel-to-work areas where the unemployment level is higher than the United Kingdom average. In those circumstances, how will training be conducted for the industries that do not exist in some localities yet are needed for the economic regeneration of the country as a whole? We have been putting that point all day, and we are still waiting for an answer.

I also worry about the thoroughness of training and the wider education of those who are being trained for industry. It seems obvious to the Opposition that the local enterprise companies will naturally be tempted to concentrate on the narrow needs of the employers who are running the enterprise companies.

In recognition of that, and in an attempt to overcome the narrow interests of particular employers, craft training has in the past been conducted at work, in the firm, and craft apprentices have gone out for training to local further education colleges where they could learn how other companies performed various tasks. Hon. Members will appreciate why we are now worried lest the scope of training is narrowed to such an extent that any training that is given is inadequate.

Nothing has been said about the wider education implications of what is proposed for young trainees, remembering the importance of training for their future. If they are trained simply to carry out narrow tasks, without having a wider idea of craft skills—I shall not go into the question of time being spent on their general education —they will be less able to transfer such skills as they have elsewhere, to other employers. That will, in turn, make them less able to conduct themselves as good adult citizens, effectively promoting their own rights. We are concerned about those and other dangers.

It is incredible that local employers are to be put at the forefront of the proposed scheme, with local authorities and people who have spent their lives in education being pushed to the back, their views and experience not receiving consideration. Running training courses is not something for amateurs. To set achievable targets for learners, to devise suitable written lessons and practical work and to test students' achievements are matters in which success has not always been achieved, even in the circumstances I have described, when we have brought together local authorities, educationists and employers.

I have witnessed students failing courses partly through their own immaturity but partly through inadequate standards being set for them and the poor monitoring of their performance. Instead of responding to the worries that we have on those scores and improving the present system, it seems that the Government are creating a system under which those shortcomings will be even more likely to occur because of inadequacies in monitoring and shortcomings in devising lessons.

Unless there is a preponderance of people with experience of preparing lessons, marking exams and running courses, we shall continue to worry about the outcome of the new scheme. In tandem with what is proposed, industrial training boards have been abolished. That gives us more reason to worry about the future.

Several other aspects of the same problem have not received much airing in the debate. Clause 16 of the Bill says that it would be unlawful to discriminate against any person providing training. Such a provision is to be welcomed, but how does the Minister square that with the views of the former Secretary of State for Employment, who has denied the child care allowance to married women who apply for training?

It seems incredible that when a married woman with three children under five whose husband's pay could not stretch to three lots of child care appealed against being refused child allowance for training, and then won her case at an industrial tribunal, the Government threw the might of the state against that solitary woman and appealed against the tribunal's decision. That step was taken by the bunch we see on the Government Benches who say that they are interested in equality of opportunity and in women having equal rights to training—[Interruption.] Is the Minister not even interested in listening to the points that I am making?

I would be interested to hear about the track record of those who will be running local schemes, in particular their track record on training opportunities and securing jobs for women. I dare say that some of them are adequate, but one is left wondering whether such matters have been examined in a coherent way.

Does the Minister intend to establish a body to monitor his proposals? If so, may we be told? Not a word has been said about how the scheme will be monitored. We are left to worry lest, as usual, women's job and training opportunities are limited in the main to a narrow range of skills and low-paid jobs with little opportunity for women to obtain the traditional skills which have normally been held by men.

If women are to receive proper employment and training opportunities, the whole issue must be examined more seriously than the Government have shown any signs of doing so far. It is all the more vital that the Scottish Trades Union Congress proposal to set up an independent body to examine the scheme is acted upon. The Ministers have shown no sign of taking any interest in those matters. They have not even seen fit to mention them tonight. That is how interested they are in the training of girls and women in Scotland.

The Minister of State, Scottish Office (Mr. Ian Lang)

I shall not use up too much time. Not only was I listening to the hon. Lady, but if she looks at clause 2(4)(a) she will find that specific provision is made to include arrangements for encouraging increases in the opportunities for training that are available to women and girls or to disabled persons".

Mrs. Fyfe

That proves that the Minister did not listen to what I said earlier. I said that if married women are not given an allowance for child care clauses 2 and 16 will be utterly meaningless. They are just words unless they are followed through with proper child care allowances for married women in particular. When the Minister says that opportunities will be given to women, let him spell them out. Local enterprise companies have been talked about for months, yet no ground has been broken in terms of training opportunities for women. If the Minister can give concrete examples in his reply, I shall be all ears. For all the reasons given by other hon. Members, and for the reasons that I have outlined, I for one will vote against the Bill.

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

I promise that I shall be brief. I have been here during the whole debate, as you know. I am not sure that it has been a worthwhile exercise. We have listened to fair-minded criticisms of the Bill, and if I thought for one moment that the Government would take some of them on board by way of reasonable amendments, I should have a lot more faith in this Parliament. However, the reverse will be the case. Ministers hate honestly awkward critics on the Opposition Benches and they despise honestly awkward critics on the Conservative Benches, not that any of them are present now.

I despair about the passage of the Bill. If it were amended along the lines suggested by Opposition Members, including suggestions from the Liberal party and the Scottish National party—the hon. Member for Banff and Buchan (Mr. Salmond) is not present—I should be more hopeful.

I should like the Minister to answer a specific question on clause 3(3), which says: In exercising its functions, Scottish Enterprise shall have regard to the requirements of agriculture and efficient land management It goes on to mention the desirability of safeguarding the environment. In the Minister's view, is fish farming an element of agriculture? Another important indigenous industry is the fishing industry. Will it, too, benefit from Scottish Enterprise having regard to the requirements of its employees? Training for fishermen is important, especially on safety.

We know that the local enterprise companies will be dominated by the private sector, with two thirds of their members coming from business and the remaining third from elsewhere. Apparently, the idea is that business men and women will give up their time to run the local boards. The Secretary of State said in the Scottish Grand Committee: They will be the non-executive directors of the local agencies. It may require a few hours a week—less in some areas and a little more in others."—[Official Report, Scottish Grand Committee, 20 March 1989; c. 9.] That is an appallingly complacent attitude on the part of the Secretary of State. I have witnessed the failure of the Inverclyde initiative, a privately led initiative to deal with the serious problems of unemployment in my constituency and part of the constituency of my hon. Friend the Member for Renfrew, West and Inverclyde (Mr. Graham). I think that my hon. Friend will agree with me that that privately led initiative has, to a considerable extent, been a failure.

I view the proposals outlined this evening with despair.

9.21 pm
Mr. Tony Worthington (Clydebank and Milngavie)

I am grateful to my hon. Friends for their speeches and continued attendance. One could not make a similar comment in respect of Conservative Members.

The Secretary of State said that the whole country was behind Scottish Enterprise. That was because the question that had been asked was whether the country was in favour of stronger links between economic development and training. Everybody is in favour of that. It is like asking whether one is in favour of truth and beauty. Of course one is in favour of better links between economic development and training. No one can possibly imagine anyone voting against that.

The Opposition are concerned about the muddle that lies behind the Bill. We are faced with a conundrum. The private sector is to lead us into the promised land. After 10 years of free enterprise and a market-led economy, we apparently need a new flagship Bill. That immediately poses the problem, "Why has the private sector not already reached the promised land?" Why are we in the House—the centre point of the public sector—preparing to take a great deal of parliamentary time to let the private sector take the lead? Surely the private sector can just get on with it. Why do we need to pass a Bill when the private sector has been given all that it needs.

Look at what the Confederation of British Industry demanded in the early 1980s. The CBI said, "We want the removal of price and dividend restrictions, growth in profitability, restrictions on trade unions and cuts in income tax and corporation tax." All that has been granted to the private sector, yet we are still a long way behind our major competitors.

If the relative growth of output per worker were maintained at its 1983–87 levels, it would take us about 10 years to catch up with the present levels in France and West Germany, and the United States and Japan are even further ahead". Who said that? The CBI, in its latest training document.

The truth is that the Bill quite inadequately attempts to create an optical illusion to try to persuade us that we are talking about a private sector initiative when all that is happening is the laundering of £0.5 billion of public money, which is to be handed over to business people. It is being made to look like a private sector initiative.

Another muddle that lies behind the Bill is that we have been told for 10 years that the business sector needs incentives to operate effectively. If it does not have carrots, it does not work hard. That is why we have the so-called enterprise culture—tax cuts, and high, even exorbitant, salaries for business leaders. Yet here we have a Bill that offers no profit or wages, just, in the words of the Secretary of State, an opportunity to serve the local community—to do good rather than make money. It seems strange that the Government should now believe that this will work. There could be a strong inducement for the wrong kind of business man to become involved because local enterprise companies will have access to privileged information. The point made by my hon. Friend the Member for Edinburgh, Central (Mr. Darling) about the potential for corruption has not been tackled at all. It is difficult to believe that top business men will devote much time to LECs. If an entrepreneur gives his or her time to LECs it cannot be anything other than damaging to their own company.

This is an enabling Bill. Regrettably, there is little detail in it—we must look at White Papers and the handbook on the subject. The Opposition's major fear is that the Government are deeply muddled about the SDA, which they do not ideologically back but which has been proved to be successful. It is an interventionist Socialist body and the Government are embarrassed by its success because they do not believe that it should be necessary—the SDA should be able to do it all. Opposition Members believe that there will always be an essential place for an SDA, and most successful economies would agree with us.

However, the Government are setting up Scottish Enterprise, expecting it to go out of business. That is stated in the section on the financial consequences of the Bill. The ultimate objective is the creation of a dynamic, self-sustaining Scottish economy in which investment and training are private sector led and financed. In other words, the Government regard financing the body as regrettable and as a sum to be reduced and then removed from the public sector. They regard the present £500 million as a reducing budget.

Opposition Members regard training and economic development as woefully resourced. What is the Government's attitude to funding? For example, if, for demographic or other reasons, numbers for the youth training scheme or employment training fall what will happen to funding of the training budget? The Government seem to claim that if the number of people out of work falls, we will need to spend less on training. What nonsense, as the right hon. Member for Old Bexley and Sidcup (Mr. Heath) said in the debate on the Queen's Speech. The major problem with training is that we need to train better those who are already in jobs, the right hon. Member for Ayr (Mr. Younger) seems not to realise that there is no money in the budget for those who already have jobs.

How well funded is the SDA at present? Its budget last year was about £150 million, of which 60 per cent. was grant in aid and 40 per cent. was income earned by the SDA. About £90 million was directly spent on the SDA. For what else do the Government pay that sort of money? They correctly spent £150 million on compensation for the third or fourth-rate Barlow Clowes investment company. They have been spending £140 million in subsidies to Network SouthEast. It costs £4.5 million to train a Tornado pilot. For the SDA, £90 million would buy 20 Tornado pilots. The Government will spend £200 million on 1,800 metres of road in Limehouse in Docklands. On that criterion, one could get 800 yards of London road for the SDA. The Government want to reduce that sum.

The Government believe that the economy has been transformed during their years in office. So it has been. In July 1979, there were 141,000 unemployed. In July 1989, there were .,233,000 unemployed. One third of all manufacturing jobs in Scotland have been lost—in Strathclyde the figure was one half. According to a European Community report a fortnight ago, the number of people in poverty in Britain has doubled since the mid-1970s. Britain's inflation rate is well over the rates of France, Germany and Japan. We are running a £20 billion deficit, and 53 per cent. of Scotland's exports are dependent on whisky and office technology.

Using the acid test of whether people want to live in Scotland—net inward and outward migration—in 1978–79, we lost 7,000 people. In 1987–88 we lost 17,000 people, while in contrast Wales—as always—gained 18,000 people, which was three times as many as in 1978–89. We have had a transformation but not one about which to boast.

There is no reference in the Bill to the links between the central Scottish Enterprise and the local enterprise company. The Government are asking that at least two thirds of the directors must be senior figures from the private sector. Will those people turn up and stick at it or will they be anything other than names on the top of the notepaper? It is absurd to think that one can gather a dozen senior figures from private enterprise at a table and expect them to work together in partnership.

The Government frequently pay tribute to the enterprise trust movement. I compliment those organisations that have done much good—but how much? How good are they and how many front-rank business leaders have been involved? Are they not really private sector fronts for public sector money? Who supports and runs them?

The annual report of the enterprise trust movement shows that the Ayrshire enterprise trust comprises of four district councils, the Strathclyde reegional council, the Irvine Development Company, the Department of Employment and some local employers. That, apparently, is a private sector-led enterprise. The north-west Fife rural initiative is a partnership between the SDA, Scottish agricultural colleges, Fife regional council, North-East Fife district council and the north-east Fife enterprise trust. That hardly sounds like a private sector-led initiative. Glasgow Opportunities had some private people. The Glasgow Easterhouse partnership is all public —the Department of Employment, the SDA, Strathclyde regional council, the Training Agency and the Drumchapel initiative. That is the enterprise trust in that area.

Some 60 per cent. of funding for the whole of the enterprise trusts in Scotland is public sector finance. If public money was withdrawn from the enterprise trusts, they would all collapse, but if private sector involvement was withdrawn, they would still operate, even if at a reduced level. I have grave doubts whether those bodies dominated by private sector—[HoN. MEMBERS: "It is the cavalry".] At last my groupie, the hon. Member for Lancaster (Dame E. Kellett-Bowman) has arrived.

Even if the private sector was serious and was committed to training and economic development, disillusionment would soon set in when it found that it was overwhelmingly expected simply to administer the United Kingdom-wide youth training and employment training schemes. That is what it is being asked to do. How can that be a Scottish answer to Scottish problems? The Secretary of State has lost out. He was in conflict with the Department of Employment because he would have liked Scotland to control its employment training and YTS but the Department of Employment would not give that control.

It is important that we have compatible training schemes throughout the United Kingdom, but that does not mean identical schemes. Nothing would be lost if employment training was scrapped and the money used for proper serious training on a Scottish basis. The CBI said that the YTS has only reached the embryo stage of a training system.

What will business people say when they find that they will have to administer the appalling employment training scheme? What will they say to two of my constituents who have successfully completed the employment training scheme? One wanted training as a typist but never saw a typewriter and the other was promised training as a barman, but never saw the inside of a bar. They spent their days playing Scrabble, Cluedo, Trivial Pursuits and cards. They were asked to list the items for survival on the moon in order of importance. They sang religious songs and successfully completed their employment training scheme. How did that train the workers without jobs for the jobs without workers?

All too frequently Ministers say that ET is the biggest scheme ever mounted. They are right, but it is also the worst. It bears as much resemblance to serious training as Zsa Zsa Gabor does to monogamy. It is designed to lower the unemployment figures. It is about the numbers game. It is the largest massage parlour ever opened. It has all the characteristics of a massage parlour—it provides only temporary relief and does nothing about the reason why the person went to the massage parlour in the first place, which in his case is to acquire serious training.

When he replies to the debate the Minister of State will have the opportunity to make quite clear what can be done in Scotland and what has to have London approval. I asked the Minister of State a simple test question in a written question recently—whether there were any proposals to alter the level of travelling expenses available on an ET scheme. The question was referred to the Department of Employment. It was a trivial issue, but it was referred. Will the Minister of State have control over the travelling expenses on ET schemes in the future? Will it be as big a control as that?

How are the local enterprise companies to exercise their training function when there is no guaranteed place or places on the board for the body which does most of the serious training in any area and which is the major preparer for careers—the local regional council's education department? The reason for their absence is the Government's continuing hostility to local authorities. Every submission wants the local authorities to be involved, but the Government continue to be hostile. When everyone else wants the boundaries between the public and private sectors to be lowered, the Government build obstacles.

There are gratuitous insults to the public sector in everything the Government do. There is the absurd pretence that the best people or the only people with enterprise are to be found in the private sector when over the past 10 years at least the truth is that the real drive for development in Scotland has come from the local authorities and the burden has been the Scottish Office.

During the Bill's passage we shall be pressing for full local authority representation as of right. 'The Government should also learn to work with the trade unions which would be working to promote quality training and which recognise the importance of the unemployed and the needs of those in work.

We recognise the valuable contribution of the voluntary organisations. One of the scandals that has been inadequately defended by the Minister was the amount of community care that callously collapsed when the community programme was converted into the employment training programme.

I am grateful to hon. Members who have spoken about the Highlands and Islands because there is a real fear that the provisions mean change for change's sake. Something much more evolutionary should have been tried. Labour Members who represent the new towns—my hon. Friends the Members for Cunninghame, South (Mr. Lambie), for Cumbernauld and Kilsyth (Mr. Hogg) and for East Kilbride (Mr. Ingram)—put their fears about the proposals on the new towns extremely well. Those dynamic public enterprise-led agencies, which have been praised by the Government, have achieved considerable success in inward investment. However, what will replace the new town teams when they are broken up? East Kilbride will spend £70 million on its capital programme this year—£30 million of its own money and £40 million of private money. What will replace that? Too rapid a wind-up will dissipate the force of the new town corporations. It is a fundamental right for new town corporation tenants to be able to choose to become district council tenants.

We have tabled a reasoned amendment to expose the muddle at the heart of the Bill. We all want to improve this country's training system. The Bill will not do so. We all want to end the north-south divide. We all believe that unemployment and poverty are far too high in Scotland, we need new high value added jobs in manufacturing and services, and better links should exist between training, education and economic developments. That would greatly improve matters. However, the underfunded, dogmatically biased and confused way in which this measure is being introduced by the Government undermines those aims, which is why we tabled the amendment.

9.40 pm
The Minister of State, Scottish Office (Mr. Ian Lang)

As my right hon. Friend the Member for Ayr (Mr. Younger) said—[HON. MEMBERS: "Where is he?"] He has apologised to me and to Opposition Members for not being here because he has an unavoidable commitment outside the House.

The debate has revealed no major philosophical objection of principle to the proposals. Instead, a large number of Committee and niggling points have been raised by Members of the Opposition parties. I shall answer as many of them as I can in the time available and return to the rest in Committee.

The hon. Member for Clydebank and Milngavie (Mr. Worthington) made an unfortunate start to his new role as spokesman on these matters when he complained that we had rushed the Bill out in a furtive manner at the end of the previous Session. The Bill was published in a perfectly normal way and presented to the House when it was sitting. I suspect that the hon. Gentleman may have pushed off home for an early Christmas. He made matters worse by reading the Bill over Christmas and making a number of assertions, such as that local business men would have the power compulsorily to purchase land, and be able to avoid local planning permission and to obtain confidential information on planning matters—a point that he repeated in his speech tonight. He tossed in a gratuitous insult to the entire Scottish business community by talking about the potential for corruption and insider dealing. He was wrong on all counts, and if he looks at clause 17(2)(a), (b), (c) and (d), he will find those points covered, and I dare say that we shall return to them in Committee.

I fear that, as so often when legislation is going through the House, the Labour party will pursue its usual policy of raising scares and alarms that have nothing to do with the reality of our proposals. The Labour party is friendless in its opposition to the Bill, if we discount its satellites in the Scottish National party and the Social and Liberal Democrats. It is out of tune, just as it was out of tune over the sale of council houses and with the mood of Scotland over the setting up of school boards.

As has been said, when organisations such as Scottish Business in the Community, COSLA, the Scottish Council for Voluntary Organisations, the Scottish Trades Union Congress and the Church of Scotland Committee on Church and Nation all support the principle of the Bill, we can see how isolated the Opposition are. The Opposition do not like the Bill because they do not like, trust or understand enterprise. Above all, they dislike and distrust decentralisation, which is one of the keys to the concept of Scottish Enterprise.

Our policy is one of devolution, which the hon. Member for Glasgow, Garscadden (Mr. Dewar) said that he wants. However, our devolution is that from the centre to the rest of Scotland, from the Government to the people, whereas the Opposition parties' idea of devolution is to set up another centralised body, imposing a still larger burden of taxation on the Scottish people. Nothing could be more ruinous to the future of enterprise in Scotland. Ten years ago Scottish Enterprise would have been inconceivable because of the state to which the Labour party had brought the Scottish economy when in government. Successive bouts of Socialism in the 1960s and 1970s had undermined and weakened the economy.

Mr. Graham

Ten years ago there were 166,000 manufacturing jobs in Strathclyde alone. They no longer exist under this Government.

Mr. Lang

Ten years ago industrial output in Scotland was 6.5 per cent. lower than it is now, even with that large number of extra employees. It is the improved competitiveness, output and productivity rate which has taken Scotland from the bottom of the productivity league to the top during the past decade and which has given us the competitiveness to enable us to bring forward our proposals. That is why employment is now at its highest for the past nine years and unemployment is at its lowest for the past nine years. That is why we see enterprise emerging through the establishment of large numbers of new company registrations—50 per cent. more than there were a decade ago—and huge increases in self-employment, up to record levels. That is the evidence of emerging enterprise in Scotland as a result of the new, stronger and broader economic base that the Government's policies have created. That is what has made Scottish Enterprise possible.

But what makes Scottish Enterprise necessary is that, despite the improvements in our competitive position and industrial base over the past few years, we face new challenges. We face the challenge of demographic change that has been referred to this evening whereby the number of school leavers will fall over the five years to 1994 by some 50 per cent. We face the challenge of the single European market and the need to be more competitive to retain our European markets and to build on them still further. We face the challenge of the opening up of the economies of eastern Europe, to which my hon. Friend the Member for Eastwood (Mr. Stewart) referred.

What we have done over that period is to build on the changes to the SDA that were introduced by my right hon. Friend the Member for Ayr when he was Secretary of State. He rightly paid tribute to the SDA, to the establishment of its regional offices, to its co-operation with the private sector and local authorities, and to its work in various individual initiatives around the country, particularly Glasgow. It does great discredit to the hon. Members for Cunninghame, South (Mr. Lambie) and for Greenock and Port Glasgow (Dr. Godman) to denigrate the SDA area initiatives and the work done in the Garnock valley, in Ayrshire, and in Inverclyde. Those initiatives were set up in response to pressing needs and job losses in those areas. They have cleared industrial dereliction and have provided modern industrial premises. They have created new job opportunities and have laid the foundations for future economic growth.

Just as my right hon. Friend the Member for Ayr inherited an SDA which was an instrument of Socialist policy, as the hon. Member for Clydebank and Milngavie said, acquisitive and interventionist, in danger of displacing enterprise, so it has gradually converted to a more catalytic role, an enabling role, helping companies and individuals to do things for themselves, working in partnership with the private sector. I can assure the House that all the skills and experience acquired by the SDA during those years will be reflected in the new arrangements and will be carried forward into the new Scottish Enterprise.

The hon. Member for Garscadden asked many questions, most of which he acknowledged would be best dealt with in Committee, but let me deal with one or two points that he raised. The relationship between the Scottish Office and Scottish Enterprise will reflect the present relationship with the SDA. We will set the policy framework, but it will have substantial powers and, I am sure, the initiative to operate creatively and innovatively as the SDA does now.

The Secretary of State for Employment will retain lead responsibility for training policy generally and, in consultation with my right hon. and learned Friend the Secretary of State for Scotland, will continue to set the national framework. But we shall set the policy framework for Scottish Enterprise and it will be responsible to the Secretary of State for Scotland. Scottish Enterprise and local enterprise companies will have the flexibility to develop their own training and enterprise initiatives in the light of Scottish circumstances.

Mr. Worthington

Will the Minister give way?

Mr. Lang

I am short of time. We shall never agree on this point this evening, but let us develop it in Committee.

Mr. Worthington


Mr. Lang

I give way.

Mr. Worthington

During the debate I asked a simple question. In future, will it be possible in Scotland to decide the level of travelling expenses on an ET scheme?

Mr. Lang

The hon. Gentleman knows the answer because I gave it in reply to a parliamentary question the other day.

My hon. Friend the Member for Eastwood said that he welcomed the boundary decision affecting the Glasgow local enterprise company and those in Dunbartonshire and Renfrewshire. Those are difficult decisions and, to some extent, they have to be subjective, but it is right to take account of the need to ensure a viable company in Dunbartonshire and Renfrewshire, and I believe that we have got the boundaries right in those cases.

The hon. Member for Banff and Buchan (Mr. Salmond) referred to the Moray district boundary. We have made it clear that the present HIDB boundary will remain the same for Highlands and Islands Enterprise. The bid from the Moray consortium has been received and will be considered on its merits, but a local enterprise company straddling the boundary would have to resolve substantial practical difficulties.

The hon. Member for Cumbernauld and Kilsyth (Mr. Hogg) suggested that new towns were a Socialist idea, but the Reith committee was appointed in 1940 by a coalition Government, and the New Towns Act 1946 was not opposed by the then Conservative Opposition. The hon. Gentleman paid tribute to the achievements of new towns, and I join him in that. They have been a great success story in providing for the overspill from our major industrial conurbations and suitable locations for the development of indigenous investment and for attracting inward investment. However, the Government, in winding up the new towns, are not motivated by any ideology, for their winding up was always envisaged in the 1946 Act. That will not be pursued in any doctrinaire way but will be undertaken in an orderly fashion, taking account of the degree of development already reached by each new town —and phased over the next decade on that account.

As to the housing waiting list in Cumbernauld, both public and private sector house building in that town remains at a high level, with 456 completions in the current year and 486 next year, including 265 houses for the development corporation. Cumbernauld has £6.9 million available in the year ahead for its housing capital programme, which will provide further accommodation. I will not be able to do justice in the time available to me to the hon. Gentleman's questions on planning in the new town corporations and on the circumstances of the staff. However, I shall not forget that he raised them, and I hope that we shall return to them in Committee.

The hon. Member for East Kilbride (Mr. Ingram) raised the issue of the role of local authorities in local development companies, but I emphasise that they are not intended as straightforward successors to the corporations. They are designed to fulfil the property development function which the corporations currently undertake and which otherwise would be lost on winding up. There will be no scope for local authority representation as such in such companies, which will essentially be commercially driven.

A number of hon. Members raised questions concerning new town housing. I emphasise the importance of choice to the tenants of new town corporations, but it must be based on an informed assessment of the alternatives. It is clear from the independent survey undertaken at the Government's request, and from the number of houses that have been purchased, that the most popular choice of all in new town areas is private ownership. More than 50 per cent. of all new town development corporation houses are privately owned, and sales doubled in the first eight months of last year. The survey confirmed that no less than 40 per cent. of tenants of houses remaining in public ownership are interested in home ownership. That interest and the need for more information were the two clearest features to emerge from the survey, which is why we are distributing an information leaflet setting out the range of choice available to new town tenants.

Mr. Lambie

On a point of order, Mr. Speaker. During the debate, the Minister gave a guarantee that he would say whether new town tenants would be given the choice of having the district council as their new landlord. He has not answered that question.

Mr. Speaker

He has not been given an opportunity to do so.

Mr. Lang

I was about to move on to that very point.

I repeat that the desire for private ownership and the need for more information were the two strongest features to emerge from the survey, which is why we are distributing a leaflet putting the choices to tenants.

The concern over the possible transfer of houses to district councils is much stronger among the councils themselves—who seem more concerned with the acquisition of assets than with the provision of services—than it is among new town residents. I emphasise that we have not ruled out the possibility of transfers to district councils, which are specifically mentioned as one of the options that we shall consider during the wind up. However, there is no need to take a decision now—and we would narrow the choice if we were to do so. As the hon. Member for Cunninghame, South (Mr. Lambie) himself pointed out, it will be 10 years before Irvine's wind up is completed, and there would be no point in moving now from one public housing body to another.

The survey showed that, of those surveyed, less than 20 per cent. would now choose to go to a district council. The hon. Gentleman will find that in paragraph 5.9 of the report. At the time of wind up, of the four out of five people who wanted that choice only half would choose a district council and more than a third did not know what they would choose.

I am grateful to my right hon. Friend the Member for Ayr for welcoming the transfer of training activities to Scotland that is reflected in the proposals. I agree with him that, as a nation, we do not take training seriously enough, and I hope that the Bill will increase the recognition of the importance of training. As my right hon. Friend acknowledged, local enterprise companies will lead to that. As my right hon. and learned Friend the Secretary of State for Scotland said, training is an investment. Local enterprise companies will integrate with other economic initiatives and make the best use of local skill resources.

A recent survey carried out by the Confederation of British Industry, which appeared in yesterday's Scotsman, revealed that companies expect to invest more next year on marketing, research, product development and training. They recognise that training is essentially the responsibility of industry.

I do not believe that the hand-wringing of the hon. Member for Clydebank and Milngavie about the lack of investment and training is very persuasive when one looks back at the commitment to training schemes made by the Labour Government between 1978 and 1979 of some £471 million compared with the approximately £3 billion that we have put into such training schemes. We now spend more as a percentage of gross domestic product on training than Germany, the United States or Japan. One can see the increased priority that we are giving to training.

The youth training scheme now has a success rate of more than 80 per cent. of those who complete the course moving on to employment, further training or higher education. The employment training scheme, which the hon. Member for Clydebank and Milngavie so derided, is filled to the extent of some 26,000 places in Scotland, and 59 per cent. of those completing the scheme go into jobs.

An important aspect of our proposals is to involve the private sector more so that they accept their responsibilities for training. The hon. Member for Banff and Buchan was among hon. Members who made that point.

Paragraph 2 of the handbook emphasises the degree of flexibility that the local enterprise companies will be able to bring to bear on their priorities for training, maximising flexibility, shaping the balance of skills training and the geographic distribution of opportunities, determining which contractors to use and the levels of payment to sub-contractors, and in changing the design and content of programmes to meet local needs.

The Opposition dislike not just the nuts and bolts of the Bill, but the whole concept of enterprise. They do not like the idea—it is alien to them. We have not invented enterprise. It is a natural part of the human spirit—a quality or talent that is in all of us to varying degrees. The Government's contribution has been to release enterprise and provide it with a favourable, stable economic environment, free from the burdens of high taxation and the excessive regulation of centralised control and of nationalisation, and all the doctrinaire trappings of Socialism.

The independence of mind that enterprise engenders runs counter to Socialist philosophy, and that is why the Opposition see it as a threat. We see enterprise as a strength, a natural resource. The drive, energy, knowledge and commitment of individuals all over Scotland will help to build up employment and prosperity and enable people to realise the full potential of each area and to accelerate the national regeneration. That is how to spread the economic successes of recent years further and deeper. It is not what the Government do, but what they enable people to do for themselves. Enterprise is the antithesis of state control, and that is why the Labour party resists it. It is the antidote to Socialism, and that has been rejected all over eastern Europe as it is irrelevant, limited and sterile.

We see enterprise as a power for good that will allow a free and prosperous society to grow and flourish. That is the philosophy that drives the proposals in the Bill. The Bill will give a new boost to enterprise and employment growth in Scotland, and I commend it to the House.

Question put, That the amendment be made:—

The House divided: Ayes 213, Noes 253.

Division No. 31] [9.59
Abbott, Ms Diane Blair, Tony
Adams, Allen (Paisley N) Blunkett, David
Allen, Graham Boateng, Paul
Anderson, Donald Boyes, Roland
Archer, Rt Hon Peter Bray, Dr Jeremy
Armstrong, Hilary Brown, Gordon (D'mline E)
Ashdown, Rt Hon Paddy Brown, Nicholas (Newcastle E)
Ashley, Rt Hon Jack Bruce, Malcolm (Gordon)
Ashton, Joe Buchan, Norman
Banks, Tony (Newham NW) Buckley, George J.
Barnes, Harry (Derbyshire NE) Caborn, Richard
Barron, Kevin Callaghan, Jim
Battle, John Campbell, Menzies (Fife NE)
Beckett, Margaret Campbell, Ron (Blyth Valley)
Benn, Rt Hon Tony Campbell-Savours, D. N.
Bennett, A. F. (D'nt'n & R'dish) Canavan, Dennis
Bermingham, Gerald Carlile, Alex (Mont'g)
Bidwell, Sydney Clark, Dr David (S Shields)
Clarke, Tom (Monklands W) Lambie, David
Clay, Bob Lamond, James
Clelland, David Leadbitter, Ted
Clwyd, Mrs Ann Leighton, Ron
Cohen, Harry Lestor, Joan (Eccles)
Coleman, Donald Lewis, Terry
Cook, Robin (Livingston) Litherland, Robert
Corbett, Robin Livsey, Richard
Corbyn, Jeremy Lloyd, Tony (Stretford)
Cousins, Jim Lofthouse, Geoffrey
Cox, Tom McAllion, John
Crowther, Stan McAvoy, Thomas
Cryer, Bob McCartney, Ian
Cunliffe, Lawrence Macdonald, Calum A.
Cunningham, Dr John McFall, John
Dalyell, Tarn McKay, Allen (Barnsley West)
Darling, Alistair McKelvey, William
Davies, Rt Hon Denzil (Llanelli) McLeish, Henry
Davies, Ron (Caerphilly) Maclennan, Robert
Davis, Terry (B'ham Hodge H'I) McNamara, Kevin
Dewar, Donald Madden, Max
Dixon, Don Mahon, Mrs Alice
Doran, Frank Marek, Dr John
Douglas, Dick Marshall, David (Shettleston)
Dunnachie, Jimmy Marshall, Jim (Leicester S)
Dunwoody, Hon Mrs Gwyneth Martin, Michael J. (Springburn)
Eadie, Alexander Martlew, Eric
Eastham, Ken Maxton, John
Ewing, Harry (Falkirk E) Meacher, Michael
Ewing, Mrs Margaret (Moray) Meale, Alan
Faulds, Andrew Michael, Alun
Fearn, Ronald Michie, Bill (Sheffield Heeley)
Field, Frank (Birkenhead) Michie, Mrs Ray (Arg'l & Bute)
Fields, Terry (L'pool B G'n) Mitchell, Austin (G'f Grimsby)
Fisher, Mark Moonie, Dr Lewis
Flannery, Martin Morgan, Rhodri
Flynn, Paul Morley, Elliot
Foot, Rt Hon Michael Morris, Rt Hon J. (Aberavon)
Foster, Derek Mowlam, Marjorie
Foulkes, George Mullin, Chris
Fraser, John Murphy, Paul
Fyfe, Maria Nellist, Dave
Galloway, George O'Brien, William
Garrett, John (Norwich South) O'Neill, Martin
Garrett, Ted (Wallsend) Orme, Rt Hon Stanley
George, Bruce Pendry, Tom
Godman, Dr Norman A. Pike, Peter L.
Gordon, Mildred Powell, Ray (Ogmore)
Graham, Thomas Prescott, John
Grant, Bernie (Tottenham) Primarolo, Dawn
Griffiths, Nigel (Edinburgh S) Quin, Ms Joyce
Griffiths, Win (Bridgend) Randall, Stuart
Grocott, Bruce Redmond, Martin
Hardy, Peter Rees, Rt Hon Merlyn
Harman, Ms Harriet Reid, Dr John
Hattersley, Rt Hon Roy Richardson, Jo
Haynes, Frank Robertson, George
Healey, Rt Hon Denis Robinson, Peter (Belfast E)
Heffer, Eric S. Rogers, Allan
Henderson, Doug Rooker, Jeff
Hinchliffe, David Ross, Ernie (Dundee W)
Hoey, Ms Kate (Vauxhall) Rowlands, Ted
Hogg, N. (C'nauld & Kilsyth) Ruddock, Joan
Hood, Jimmy Salmond, Alex
Howell, Rt Hon D. (S'heath) Sedgemore, Brian
Howells, Geraint Sheerman, Barry
Howells, Dr. Kim (Pontypridd) Sheldon, Rt Hon Robert
Hoyle, Doug Shore, Rt Hon Peter
Hughes, John (Coventry NE) Short, Clare
Hughes, Robert (Aberdeen N) Skinner, Dennis
Hughes, Sean (Knowsley S) Smith, Andrew (Oxford E)
Illsley, Eric Smith, C. (Isl'ton & F'bury)
Ingram, Adam Smith, Rt Hon J. (Monk'ds E)
Janner, Greville Smith, J. P. (Vale of Glam)
Jones, Barry (Alyn & Deeside) Snape, Peter
Jones, leuan (Ynys Môn) Soley, Clive
Jones, Martyn (Clwyd S W) Spearing, Nigel
Kaufman, Rt Hon Gerald Steinberg, Gerry
Kinnock, Rt Hon Neil Stott, Roger
Kirkwood, Archy Strang, Gavin
Straw, Jack Williams, Rt Hon Alan
Taylor, Mrs Ann (Dewsbury) Williams, Alan W. (Carm'then)
Taylor, Matthew (Truro) Wilson, Brian
Thompson, Jack (Wansbeck) Winnick, David
Turner, Dennis Worthington, Tony
Wall, Pat Young, David (Bolton SE)
Wallace, James
Walley, Joan Tellers for the Ayes:
Wardell, Gareth (Gower) Mr. Robert N. Wareing and
Watson, Mike (Glasgow, C) Mr. Frank Cook.
Welsh, Michael (Doncaster N)
Adley, Robert Fookes, Dame Janet
Aitken, Jonathan Forman, Nigel
Alexander, Richard Forsyth, Michael (Stirling)
Amess, David Garel-Jones, Tristan
Amos, Alan Glyn, Dr Sir Alan
Arbuthnot, James Goodlad, Alastair
Arnold, Jacques (Gravesham) Goodson-Wickes, Dr Charles
Arnold, Tom (Hazel Grove) Gorman, Mrs Teresa
Aspinwall, Jack Greenway, Harry (Ealing N)
Atkins, Robert Grist, Ian
Atkinson, David Gummer, Rt Hon John Selwyn
Baker, Nicholas (Dorset N) Hamilton, Hon Archie (Epsom)
Baldry, Tony Hamilton, Neil (Tatton)
Banks, Robert (Harrogate) Hampson, Dr Keith
Beaumont-Dark, Anthony Hanley, Jeremy
Bendall, Vivian Hargreaves, A. (B'ham H'll Gr')
Bennett, Nicholas (Pembroke) Harris, David
Benyon, W. Hawkins, Christopher
Blaker, Rt Hon Sir Peter Hayes, Jerry
Bonsor, Sir Nicholas Hayward, Robert
Boscawen, Hon Robert Heathcoat-Amory, David
Boswell, Tim Hicks, Mrs Maureen (Wolv' NE)
Bowden, Gerald (Dulwich) Hicks, Robert (Cornwall SE)
Bowis, John Higgins, Rt Hon Terence L.
Boyson, Rt Hon Dr Sir Rhodes Hill, James
Braine, Rt Hon Sir Bernard Hind, Kenneth
Brandon-Bravo, Martin Hogg, Hon Douglas (Gr'th'm)
Brazier, Julian Howard, Rt Hon Michael
Bright, Graham Howarth, Alan (Strat'd-on-A)
Bruce, Ian (Dorset South) Howarth, G. (Cannock & B'wd)
Buck, Sir Antony Howell, Rt Hon David (G'dford)
Budgen, Nicholas Howell, Ralph (North Norfolk)
Burns, Simon Hughes, Robert G. (Harrow W)
Burt, Alistair Hunt, David (Wirral W)
Butcher, John Hunter, Andrew
Butler, Chris Irvine, Michael
Butterfill, John Jack, Michael
Carlisle, John, (Luton N) Jackson, Robert
Carlisle, Kenneth (Lincoln) Janman, Tim
Carrington, Matthew Johnson Smith, Sir Geoffrey
Carttiss, Michael Jones, Gwilym (Cardiff N)
Chalker, Rt Hon Mrs Lynda Jones, Robert B (Herts W)
Chapman, Sydney Jopling, Rt Hon Michael
Chope, Christopher Kellett-Bowman, Dame Elaine
Clark, Hon Alan (Plym'th S'n) Key, Robert
Clark, Dr Michael (Rochford) King, Roger (B'ham N'thfield)
Clark, Sir W. (Croydon S) Kirkhope, Timothy
Clarke, Rt Hon K. (Rushcliffe) Knapman, Roger
Colvin, Michael Knight, Greg (Derby North)
Coombs, Anthony (Wyre F'rest) Knowles, Michael
Coombs, Simon (Swindon) Knox, David
Cormack, Patrick Lamont, Rt Hon Norman
Couchman, James Lang, Ian
Cran, James Latham, Michael
Currie, Mrs Edwina Lawrence, Ivan
Curry, David Lawson, Rt Hon Nigel
Davies, Q. (Stamf'd & Spald'g) Lee, John (Pendle)
Davis, David (Boothferry) Leigh, Edward (Gainsbor'gh)
Day, Stephen Lennox-Boyd, Hon Mark
Devlin, Tim Lester, Jim (Broxtowe)
Dorrell, Stephen Lloyd, Peter (Fareham)
Dunn, Bob Lord, Michael
Durant, Tony Luce, Rt Hon Richard
Emery, Sir Peter Lyell, Rt Hon Sir Nicholas
Fairbairn, Sir Nicholas Macfarlane, Sir Neil
Fallon, Michael MacGregor, Rt Hon John
Field, Barry (Isle of Wight) Maclean, David
McLoughlin, Patrick Shelton, Sir William
McNair-Wilson, Sir Michael Shephard, Mrs G. (Norfolk SW)
McNair-Wilson, Sir Patrick Shepherd, Colin (Hereford)
Malins, Humfrey Shepherd, Richard (Aldridge)
Mans, Keith Shersby, Michael
Maples, John Sims, Roger
Marland, Paul Skeet, Sir Trevor
Marshall, John (Hendon S) Smith, Sir Dudley (Warwick)
Marshall, Michael (Arundel) Speller, Tony
Martin, David (Portsmouth S) Spicer, Sir Jim (Dorset W)
Mates, Michael Spicer, Michael (S Worcs)
Maude, Hon Francis Squire, Robin
Mawhinney, Dr Brian Stanbrook, Ivor
Maxwell-Hyslop, Robin Stanley, Rt Hon Sir John
Mayhew, Rt Hon Sir Patrick Steen, Anthony
Mellor, David Stern, Michael
Meyer, Sir Anthony Stevens, Lewis
Miller, Sir Hal Stewart, Allan (Eastwood)
Mills, Iain Stewart, Andy (Sherwood)
Mitchell, Andrew (Gedling) Stewart, Rt Hon Ian (Herts N)
Mitchell, Sir David Stradling Thomas, Sir John
Moate, Roger Sumberg, David
Morrison, Sir Charles Summerson, Hugo
Morrison, Rt Hon P (Chester) Taylor, Ian (Esher)
Moynihan, Hon Colin Taylor, John M (Solihull)
Mudd, David Taylor, Teddy (S'end E)
Nelson, Anthony Temple-Morris, Peter
Neubert, Michael Thompson, D. (Calder Valley)
Newton, Rt Hon Tony Thorne, Neil
Nicholls, Patrick Thornton, Malcolm
Nicholson, David (Taunton) Thurnham, Peter
Norris, Steve Tracey, Richard
Onslow, Rt Hon Cranley Trippier, David
Oppenheim, Phillip Trotter, Neville
Page, Richard Twinn, Dr Ian
Paice, James Vaughan, Sir Gerard
Parkinson, Rt Hon Cecil Waddington, Rt Hon David
Patnick, Irvine Wakeham, Rt Hon John
Patten, Rt Hon Chris (Bath) Waldegrave, Rt Hon William
Patten, Rt Hon John Walker, Bill (T'side North)
Pattie, Rt Hon Sir Geoffrey Waller, Gary
Pawsey, James Ward, John
Porter, David (Waveney) Wardle, Charles (Bexhill)
Portillo, Michael Warren, Kenneth
Powell, William (Corby) Watts, John
Price, Sir David Wells, Bowen
Redwood, John Wheeler, Sir John
Rhodes James, Robert Whitney, Ray
Riddick, Graham Widdecombe, Ann
Ridley, Rt Hon Nicholas Wiggin, Jerry
Rifkind, Rt Hon Malcolm Wilshire, David
Roberts, Wyn (Conwy) Winterton, Mrs Ann
Rossi, Sir Hugh Winterton, Nicholas
Rost, Peter Wolfson, Mark
Rowe, Andrew Woodcock, Dr. Mike
Rumbold, Mrs Angela Yeo, Tim
Ryder, Richard Young, Sir George (Acton)
Sainsbury, Hon Tim
Sayeed, Jonathan Tellers for the Noes:
Scott, Rt Hon Nicholas Mr. David Lightbown and
Shaw, David (Dover) Mr. Tom Sackville.
Shaw, Sir Giles (Pudsey)

Question accordingly negatived.

Main Question put forthwith pursuant to Standing Order No. 60 (Amendment on Second or Third Reading), and agreed to.

Bill accordingly read a Second time, and committed to a Standing Committee pursuant to Standing Order No. 61 (Committal of Bills).