§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Boswell]
§ 10.2 pm
§ Mr. William McKelvey (Kilmarnock and Loudoun)
My promotion to the Front Bench follows a military-style coup by Ayrshire Members, but it is temporary. Nevertheless, I welcome the opportunity to discuss an issue that is important not only for Kilmarnock but for Scotland and beyond.
The Minister is probably aware that Kilmarnock and Loudoun has the second highest number of textile and clothing employees of any constituency in Scotland. Therefore, you, Mr. Speaker, and the Minister will understand my deep concern for the industry's future and for the well-being not only of my constituents but of those in Scotland who work in the textile and knitwear industry and associated industries. Their futures have prompted the debate. As Kilmarnock is often described as a microcosm of Scottish industry, its case is indeed Scotland's case. I hope that the Minister will understand and accept that.
If the Minister has done his homework—I am sure that he has—he will know that the multi-fibre arrangement ends on 31 July. That date was chosen when talks commenced on the Uruguay round of the GATT negotiations in 1986. Those negotiations were expected to be successfully concluded by Christmas 1990 and, sensibly, a seven-month overlap was allowed for Governments to change their practices in line with GATT.
Inevitably, as the Minister will understand, problems arose and the Uruguay round of talks was halted. Those problems have now been overcome, and talks recommenced last month. However, the negotiations are months behind, and for that reason it is essential that the multi-fibre arrangement is extended for a further 17 months or until the results of the Uruguay round are ready to be implemented.
Our—and by that I mean Scotland's—lace, textile knitwear and clothing manufacture is of a high quality; I do not think that anyone in the House would dispute that. Therefore, it could easily hold its own in the world markets if the way were clear for it to do so and if the playing field were level. Even with the multi-fibre arrangement, there are many distortions which make fair competition extremely difficult—distortions such as South Korea's latest £2.5 billion subsidy scheme for its textile and clothing industry. 0 that the Minister were able to give one tenth of that to Kilmarnock and one half to Scotland.
Subsidies are also given by the Turkish, Belgian, French, Spanish and Italian Governments. Other countries employ other means to protect their homegrown textile industries, including excessive tariff rates, excessive import duties and even the prohibition of imports of textiles and clothing if similar goods are produced domestically. There is even a fraud facilitated by countries such as Taiwan and Japan to allow the registration of brand names, falsely implying a United Kingdom origin.
That list is by no means comprehensive, because we have only a short time to debate it, but it is a taster of the difficulties faced by the Scottish and, indeed, the British textile, lace and knitwear industries.
The hope of the industry, of my constituents and, I trust, of the Minister—
§ The Parliamentary Under-Secretary of State for Scotland (Mr. Allan Stewart)
§ Mr. McKelvey
—is that the Uruguay round of talks will remove the distortions which have led to many job losses and to many closures not only in my constituency, but in others in Scotland and in the United Kingdom as a whole.
Those losses and closures are evident from the fact that, in 1978, there were about 1,300 manual jobs in Kilmarnock's textile industry. In March this year, there were about 800. If one adds to those figures the clerical and external support and management jobs, hon. Members will understand why the industry believes that it has at best been ignored by the Government and at worst decimated by their inactivity.
Recently, two textile companies in my constituency closed with a loss of 200 jobs. We often hear of a mega-loss of jobs, so hon. Members might wonder why we should be concerned about the loss of 200 jobs. I am talking about small townships, where the loss of 100 or 200 jobs can decimate the economy because there are no alternative jobs. In some parts of my constituency, the loss of 100 or 200 jobs is equal to the mega-loss of jobs in other constituencies. Therefore, it is not surprising that the industry and its workers are highly nervous about the ending of the multi-fibre arrangement, the further distortions and frauds which could be unleashed and the subsequent effects in job losses.
The Minister for Trade has agreed to argue for a 17-month extension of the multi-fibre arrangement. I welcome that, and applaud his decision. However, it is feared that there could be a relaxation of the present arrangements, and I ask the Minister to use his good offices for such a good cause and to ensure that there is no relaxation. I invite the Minister to restate, if he can, the Government's commitment to the extension of the multi-fibre arrangement for either a further 17 months, as he has stated, or until the results of the Uruguay round are ready for implementation, whichever is the longer.
I also invite the Minister to support the current multi-fibre arrangement and to assure my constituents, the people of Scotland and the British textile industry as a whole that our negotiations will not allow any relaxation of the present arrangements. Furthermore, I would be pleased to hear the Minister's commitment to the extension of bilateral agreements with the European Community for a further 12 months after their current term has finished. I know that the Minister does not have responsibility for negotiating that, but his commitment to act from the Scottish Office on our behalf would be much welcomed by the Scottish people.
The existence of so many inequalities—despite the multi-fibre arrangement, which all of us support and which we so desperately require—has led to many job losses in my constituency. The manufacturers, the unions and the district council have tried for some time to seek interim solutions. Almost exactly one year ago, on 4 July 1990, I met the Secretary of State for Scotland. I was accompanied by Kilmarnock and Loudoun district council's economic development officer, Miss Jaqueline Cullen, the provost, Jim Mills, and Mr. McChristie, an officer of the General, Municipal and Boilermakers Union.
The Secretary of State said that a survey by the Scottish Development Agency was under way, and, although there had been some delay, he assured us that he would 416 investigate to see whether the survey had taken place and that he would report back to us soon. I know that that is not the responsibility of the Minister, but the previous incumbent of the job said that he would report back to us.
However, in one year we have heard not a cheep about the seriousness of the situation in Kilmarnock, about the fact that the SDA was supposed to undertake that survey, or about what has happened since then. All we have heard about, through the auspices of Enterprise Ayrshire, was the recent launch of the Scottish lace brand logo. The lace industry's manufacturers got together to form themselves into an association. That is to be welcomed, but it involves a restricted group of people.
Since that time, my constituents in the industry have not stood still. Tom Smith, the managing director of the Loudoun Valley Manufacturing Company, said to me only today:As one of the principal manufacturers of the local valley for the past 30 years, I have never known trade to be so bad. The apparent lack of understanding shown by the present Government in not giving assistance and also the fact that cheap imports are coming into Britain is destroying the textile trade.
§ Mr. George Foulkes (Carrick, Cumnock and Doon Valley)
I endorse every word that my hon. Friend has said so far. As he knows, my constituency used to be principally a mining constituency, but the largest sector of employment is now textiles, knitwear and clothing. That includes Kyle Knitwear and Cumnock Knitwear, which makes knitwear cards, Glenafton Textiles, which makes socks, Saracen, which makes nightdresses and other similar things, and Falmers, which makes the well-known jeans.
They are being squeezed by the MFA and unfair competition, with socks from countries such as Turkey, which is not an underdeveloped country, and knitwear from Korea and similar countries. They are also being squeezed by the recession, which is dampening down demand in the high street.
Would my hon. Friend urge the Minister, as well as dealing with Kilmarnock in his reply, to deal with Carrick, Cumnock and Doon Valley and the problems of the knitwear and textile industry there, as he has been briefed to do? It would be useful if he could include that in his reply.
§ Mr. McKelvey
As usual, I am indebted to my hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) for a helpful intervention. What he has said is correct. I have already told the Minister that I am not speaking only on behalf of Kilmarnock and all nny colleagues from Ayrshire, including the right hon. Member for Ayr (Mr. Younger). In reality, the debate not only extends to Scotland, but affects the textile industry throughout the United Kingdom.
Mr. Smith said that this was a trade that had existed in the Irvine valley throughout Kilmarnock for well over 100 years. He concluded:If there is not some help or assistance given in the very near future there could be no textile industry in this district.We are now about the only manufacturers of lace in the United Kingdom, and we would not under any circumstances want to lose part of our somewhat recent heritage. The heritage of the knitwear industry in Scotland goes back rather further. We could afford to lose neither our heritage, nor the jobs, nor that part of the income of our economy.
417 Kilmarnock and Loudoun district council is now setting up a textile forum in my constituency, at my request. It will comprise representatives of textile industry management, trade union officers, representative councillors and council officers. The forum's aim is to seek some defence for the future of that worthwhile industry. It has already invited the European Commissioner for regional policy, Bruce Milan, to a meeting to discuss the problems and to ask if there is any possibility of European help either now, in the short term, or perhaps in the long term —in 1993, when the regulations change. It is hoped that some EC funds will be available to provide short-term pump priming for an industry that needs and deserves it.
If that were achieved, consumers would be able to compare like with like, and I have no doubt that the quality of the textiles, lace and knitwear not only from Kilmarnock but from the whole of Ayrshire, to Scotland and beyond, will secure the jobs and perhaps even allow the industry to expand and to gain back its lost jobs and its market position.
I hope that the Minister will support the initiative. I do not want promises such as those I received from his predecessor. To give someone a promise and then sit back and do nothing for a year is not acceptable. In fairness to the Minister, I have not encountered in my recent dealings with him such a laissez-faire attitude. I hope that he understands the seriousness of the problem. I shall look for total and enthusiastic support not only from the Minister but from his right hon. and hon. Friends in government, and an insistence on ensuring the survival of the textile, lace and knitwear industry not only in Kilmarnock, Ayrshire and the rest of Scotland, but throughout the United Kingdom.
We in Kilmarnock have set the ball rolling. The Minister has the ball at his feet. I want him to imagine a Hampden scenario. Will he seize the initiative? Will he rise to the challenge for which all Scotland is waiting? It is Scotland versus the rest of the world and the Minister has the ball at his feet. Will he take it in control? Will he swerve past the midfield, nutmeg the centre half, draw the goalie and slam the ball into the net to score the winning goal for Scotland? Will he bring the textile championship back where it belongs—north of the border? If he does that, he will have the support not only of my colleagues and myself, but perhaps of the whole of Scotland.
§ The Parliamentary Under-Secretary of State for Scotland (Mr. Allan Stewart)
Seldom have I received a more alluring invitation than that extended to me by the hon. Member for Kilmarnock and Loudoun (Mr. McKelvey). I hope that I shall not completely disappoint him.
I offer my genuine congratulations to him on securing this Adjournment debate and on making an extremely well-informed speech. The fact that it was well informed came as no surprise to anyone who knows of the hon. Gentleman's interest in the textile industry in his constituency.
I congratulate the hon. Gentleman, too, on his temporary elevation to the Front Bench. I am sure that my fellow Under-Secretary of State, my hon. Friend the 418 Member for Edinburgh, West (Lord James Douglas-Hamilton), will agree with me that we in the Scottish Office have never seen such a formidable Opposition Front Bench team as we see in the House this evening.
I also pay tribute to the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes)—
§ Mr. Stewart
The hon. Gentleman is on the Back Benches on this occasion, although not always. His interest in and knowledge of the industry are well established.
The hon. Member for Kilmarnock and Loudoun was right to begin by recognising the importance of the industry not just for Ayrshire but for Scotland as a whole. It is one of our longest established manufacturing industries. The hon. Gentleman was also right to refer to its importance in terms of employment and output. According to the latest estimates available to me, its total work force is about 27,000 people and it represents about 5 per cent. of the value of the total output of Scottish manufacturing industry.
Many people do not realise the industry's importance as a major exporter ranking sixth, by value, in the league table of Scotland's export-oriented industries. The hon. Gentleman rightly told the House that the industry is as long established in Ayrshire as anywhere else—including Dundee—and it remains the most important manufacturing industry in the whole area. Approximately 16 per cent. of all manufacturing jobs in Ayrshire are in the textile industry. The figure is higher in some localities—in the hon. Gentleman's constituency, for instance, it is about 33 per cent.
As all Ayrshire Members frequently remind the House, Ayrshire is a large and varied area, and the textile industry is almost as diverse as the area. It comprises a multifarious group of industries engaged in the manufacture of lace, knitwear and hosiery, warp knitted goods, woollen and worsted goods and carpets, and in textile finishing and the manufacture of clothing. Diverse though it is, the textile industry in Ayrshire is characterised by two general features. The first is its success in exporting, to which I have already referred, and the second, to which the hon. Member for Kilmarnock and Loudoun rightly referred, is the high quality of its products.
I recognise that there has been some contraction and loss of employment, but Ayrshire has not suffered so badly as most other textile manufacturing areas. I would go further—there are some real success stories in the Ayrshire textile industry, as I am sure Opposition Members would be the first to acknowledge. One of them is the Unitex company, a garment maker and manufacturer of knitted fabric which opened a factory in Irvine in 1989 and is about to occupy a second factory. It is a far eastern company whose decision to come to Ayrshire was influenced by an offer of Government assistance made through Locate in Scotland.
The hon. Member for Kilmarnock and Loudoun was right to emphasise the fact that, among the long-established indigenous companies, the Ayrshire lace manufacturers deserve a special mention. The industry has managed to achieve a significant increase in output and employement over the past five years, and the recent formation of the Scottish Lace Guild augurs well for the future of the industry. It was initially funded and 419 supported by Enterprise Ayrshire, and was launched on 21 May. If the hon. Gentleman looks carefully at my tie, he will see that the Scottish Lace label bears a thistle and a Celtic-style cross. [Interruption.] I can inform the hon. Member for Cunninghame, North (Mr. Wilson) that when I launched Scottish Lace I was given a tie but not a matching shirt. It is a significant and important initiative.
In that context, I will reply to the remarks of the hon. Member for Kilmarnock and Loudoun about what happened following his meeting last July with my right hon. Friend the Secretary of State, then Minister of State. I have a copy of the letter which was sent to the hon. Gentleman on 8 August as a follow-up to the meeting, explaining the position on the surveys to which he referred. If that letter has gone astray, as seems to be the case, I will of course let the hon. Gentleman have a copy for his record of the response following the meeting.
§ Mr. McKelvey
So that there is no mystery about this, if there was to be a survey and it was undertaken, what would happen to it? That is the mystery.
§ Mr. Stewart
I am glad that the hon. Gentleman has recognised that my right hon. Friend the Secretary of State responded to the point about the survey. Inevitably, the survey was substantially of a commercially confidential nature and was therefore discussed with the Scottish Development Agency. Discussions with the companies concerned led to the formation of the Scottish Lace Guild, to which I have referred.
With regard to assistance to the industry, the hon. Member for Kilmarnock and Loudoun will be aware that Ayrshire is an assisted area. Twenty four Ayrshire textile companies have received offers of grant totalling £2.6 million over the past five years. Ayrshire companies can of course also apply for help through the enterprise initiative consultancies, through a number of other Government-run schemes and through the Scottish exports office which is another ready source of advice.
I want to respond to the hon. Gentleman's questions about the work of Scottish Enterprise and Enterprise Ayrshire in the textiles sector. Scottish Enterprise has a team of people addressing the needs of the textile industry in Scotland. They are currently undertaking a review of the industry in association with all the local enterprise companies. It is hoped that the review will lead to a strategy that will help Scottish Enterprise to make the Scottish textiles industry more aware of the demands of the market, more design conscious, more adaptable to changes in fashion, and better trained. For its part, Enterprise Ayrshire is giving a high priority to helping the Ayrshire textiles industry in technology, marketing, 420 training and environmental improvement. On the marketing front, Enterprise Ayrshire has already earned praise by helping to establish the Scottish Lace Guild to which I referred earlier.
The hon. Member for Kilmarnock and Loudoun was right to refer to the important question of the international trade in textiles. My hon. Friend the Minister for Trade will study very carefully the detailed points that the hon. Gentleman made tonight. There are currently two main issues to be decided multilaterally. The first is the negotiation to turn the textiles trade to normal GATT rules as part of the wider Uruguay round.
It is worth recording that that sector has enjoyed protection for many years. In the case of the United Kingdom, the 1989 study by Professor Silberston commissioned by the Department of Trade and Industry estimated that that cost consumers about £1 billion every year. All parties in the negotiation are agreed on the need to phase out the multi-fibre arrangement and we were close to agreement, as the hon. Gentleman recognised, last December on the terms for doing that over about 10 years.
Rightly, however, hon. Members and industry representatives lay much stress on the other side of the coin —that is, the need to strengthen GATT rules and disciplines and to improve market access to provide, among other things, fairer conditions for trade in textiles. The hon. Gentleman was right to raise that point. I can assure him that Britain and the European Community have consistently made it clear that all countries must accept adequate commitments in those areas.
That is a compelling reason for seeking to achieve the liberalisation of trade and textiles as part of a successful overall conclusion to the Uruguay round. Such an outcome would provide for improved access to others' markets, more satisfactory rules governing unfair trade practices, such as dumping and subsidies, and improved intellectual property protection. A satisfactory settlement was beginning to emerge last December.
The second issue follows directly from the failure to conclude the Uruguay round last year—that is, the need to extend the MFA for an interim period when it expires at the end of this month. I confirm that the European Community has proposed an extension until the end of 1992—the 17 months to which the hon. Gentleman referred—which would give our industry, our importers and our retailers the certainty that they seek. Agreement has not been reached on that, but I can give the hon. Gentleman the absolute assurance that the Government share his and the industry's desire that that issue should be settled as soon as possible.
Question put and agreed to.
Adjourned accordingly at half-past Ten o'clock.