HC Deb 08 June 1992 vol 209 cc121-8

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Robert G. Hughes.]

10.38 pm
Mr. Tony Lloyd (Stretford)

The bulk of the Trafford park estate is in my constituency, and for those of us who grew up in Manchester, it was once a symbol of the north-west's manufacturing strength. My hon. Friend the Member for Manchester, Blackley (Mr. Eastham) spent much of his working life with the company formerly known as Metrovic, later GEC—and that industrial upbringing was a valuable part of the area's economic and cultural strength. Many of those who have passed through the doors of the House served part of their industrial and political time in Trafford park.

It is a considerable tragedy to have witnessed the steady erosion of the area's employment, skills, and industrial base. Matters looked particularly bad up to the time when I first entered the House. I remember having several exchanges with Ministers at that time about the needs of the Trafford park area. That led ultimately to the creation of the urban development corporation. As I urged that upon Ministers, it would have been churlish to do anything other than support the Government's creation of that particular corporation.

Together with many other people in the area, I have done what I can to support the corporation's efforts to bring jobs and industry to Trafford park. That said, although it may have seemed, when the corporation first came into being, that Trafford had turned the industrial corner, the recession of the past few years has seen a haemorrhaging of jobs. Today's debate has largely been prompted by the almost simultaneous loss of 1,000 jobs by four major employers—Texaco, Massey-Ferguson, the Co-op, and GEC.

Every one of those job losses is a tragedy, but I will dwell on GEC—formerly Metrovic—because it was once the biggest employer in the Trafford park area. As a training ground for young apprentices, it was reckoned to be among the finest in the world. For GEC to announce virtually the end of turbine manufacture there is viewed by many—myself included—as a betrayal of GEC's background and of the community which put so much into that company. I hope that those words reach the company, and that it appreciates the strength of feeling about the way it has treated the area.

Trafford park and the Manchester travel-to-work area have seen 7,703 redundancies in the 12 months from 1 June 1991 to 31 May this year, while Greater Manchester has suffered job losses totalling well over 13,000—an increase over the previous year. Far from the recession coming to an end in Greater Manchester, it is deepening.

The jobs being lost are largely those which contribute to my constituency and to those of other hon. Members the skills network which is so vital to a modern economy. We have seen massive job losses in electrical and mechanical engineering, and in the manufacture of transport equipment. Those are all industries vital to the industrial strength and future not only of the north-west but of the whole country.

In the years since the economy started turning against the manufacturing sector, we have had a Government who are hostile, or at least indifferent, to its plight. The pound has ridden at ridiculously high levels on the international currency exchanges, making exports of our manufactures unrealistic. Interest rates have reached record levels, which again makes it extremely difficult to invest. The rate of investment in industry and manufacturing bears that out, and investment in manufacturing in the north-west has fallen greatly.

The net consequence of that lack of investment has been a loss of jobs and an erosion of the skills base. The level of unemployment in my constituency has almost returned to that reached in the first recession under the Conservative Government of the early 1980s. It is no surprise that the increase has been marked by a similar massive increase in crime. Crime is often part of the black economy into which our young people are siphoned off due to lack of training opportunities or adequate jobs. My constituency is home to the centre of the drugs trade in the north-west. That is a source of great regret to me and I would far sooner see my young people employed at Trafford park.

Last week I received a letter from a constituent—it is typical of many—who wrote: Yet another letter about the recession 1 am afraid. I am only 51 and find it very hard to find work and have been out of work apart from some casual work for 18 months due to redundancy and I feel that in some cases this is an act of discrimination due to my age etc. as I am a young and active chap. I feel hitter at times My constituent, in common with many people, wants secure employment. Such people once had the economic security which meant that they and their families had a future. Because of redundancy, the recession and mass unemployment, those people are now not only out of work but without hope and living in despair.

Mr. Ken Eastham (Manchester, Blackley)

This is almost a debate about despair. The Trafford park industrial estate served all Manchester, including Bury and Bolton. GEC was the traditional centre of great skills. We are told that there is a national shortage of skilled people, but they have been dissipated. Would my hon. Friend care to comment on the amalgamation between GEC and Alsthom, which is causing great concern? It is feared that, because of that amalgamation, jobs will go to France. It is possibly because of the management —

Madam Deputy Speaker (Dame Janet Fookes)

Order. I am sorry to interrupt the hon. Gentleman, but his intervention is far too long, especially in a short Adjournment debate.

Mr. Eastham

I apologise. This is an important debate about an issue of great concern. I wonder whether my hon. Friend would like to underline my—

Madam Deputy Speaker

Order. I am sorry, but the hon. Gentleman must resume his seat.

Mr. Lloyd

My hon. Friend has touched upon an issue with which I have considerable sympathy.

It is significant that Texaco and Massey-Ferguson have decided to retrench their activities in different parts of the country. As my hon. Friend said, GEC is now an Anglo-French company. There is a strong suspicion that the order book for France is full, while that for Britain is relatively empty. I accept that a limited number of jobs will be retained in Britain for a few years, but the effective closure of the turbine manufacturing plant in Trafford park is, in part, due to the internationalisation of GEC and the fact that the French always make sure that they protect their domestic industry. The French have an active policy of supporting investment and have a product purchasing policy which favours the home industrial base. GEC saw virtually no new orders of turbines from the previously state-owned Central Electricity Generating Board or its successor company after privatisation.

The same applies to a company in my constituency. Another part of GEC is responsible for the manufacture of traction—railway engines and so on. Once again, the lack of home demand over the years has meant that GEC Traction has suffered unfair competition relative to other international producers. Nowadays large-scale engineering is increasingly carried out on an international basis by major international consortia such as GEC Alsthom in Manchester, Siemens and Braun Bovary. Those are all large international producers and, except for the British companies, all have support from their Governments and home economies, so they at least have an opportunity to invest in research and development knowing that their home base will generate the demand which justifies such investment. In Britain, almost uniquely, such investment does not take place because the Department of Trade and Industry does not sponsor our domestic producers. That is a matter of considerable regret, not just to Opposition Members but to many people throughout our manufacturing sector. We need the Government to take a different view of the manufacturing sector.

I appreciate why the Under-Secretary of State for Employment is here tonight. Industry debates could be answered by Ministers from many different Departments. We want the Government to take a co-ordinated approach to the manufacturing sector. It is not enough simply to invest in a development corporation which, although it will do what it can, can do nothing about the recession which is still laying sway to industry throughout the land. Indeed, confronted with recent job losses, the development corporation said that it was trying to take various steps. It claimed, for instance, that it was trying to create 1,600 jobs on the Massey-Ferguson site. Those jobs may come to fruition in the future, but jobs have disappeared here and now. The development corporation made it clear that the recession was having a detrimental effect on its efforts in the area. Sponsored by the Department of the Environment, the development corporation is not enough of itself.

I hope that the presence of a former Secretary of State for the Environment in the Board of Trade means that we shall begin to have a co-ordinated approach between the different Government Departments. We need a clear message from the Minister today, not just to Trafford park but to the whole of the manufacturing sector, that the days are over when the former Chancellor, Nigel Lawson, said that manufacturing was all about the sunset industries and that Britain was looking to a brave new future of services. The Minister must assure us that such political rhetoric and economic nonsense is a thing of the past and that the Government will target the manfacturing sector as the most important part of Britain's economic future. Unless the Government work in that spirit, the problems that I have outlined in Manchester will continue and many of the productive centres of Britain will continue to see devastation and waste.

Beyond a commitment to the manfacturing sector, we need a commitment to policies which will give manufacturing a chance. For instance, we need a Government who support exports. There are certain problems with export credit guarantees. I do not know whether the Minister can comment on those tonight, but I hope that he will take the matter on board and convey the problems to colleagues at the Department of Trade and Industry who can deal with it. Our exporters certainly feel hobbled by the problems that they face with the Export Credits Guarantee Department when they compare their position to that of exporters in similar industrialised countries.

We need a Government who will place emphasis on investment in manufacturing. Manufacturing in my area has been cut back dramatically. The Government must make such investment worth while. Until interest rates come down, it is unrealistic to believe that manufacturing investment will race forward, but the Government must sponsor those who are prepared to invest in the manufacturing sector and ensure that that investment leads to the creation of new, highly skilled jobs.

The tragedy of what has happened in Trafford park in recent years is that highly skilled, high value jobs which used to be at the heart of the region have been replaced with relatively semi-skilled and unskilled jobs. I do not complain about any job that is created, but we must begin to retrain all our people, not merely those in selective parts of the country, if we are to give them the dignity that they deserve. We must begin to turn the corner. At present, many of our young people have no hope of employment or, even if they have, they believe that there is no long-term Government commitment to it. Without any commitment to invest in training our young people, the future for districts such as mine is bleak.

I hope that the Minister can give some words of comfort tonight. I hope that I have not spoken in a partisan manner, although I obviously had some criticisms to make. I hope that, in turn, the Minister will respond by making it clear that the Government are committed to the Trafford park district, to manufacturing industry and to a future for my constituents which will bring them long-term jobs and rewards.

11.57 pm
The Parliamentary Under-Secretary of State for Employment (Mr. Patrick McLoughlin)

I congratulate the hon. Member for Stretford (Mr. Lloyd) on securing tonight's debate. I notice that he is supported by the hon. Members for Manchester, Blackley (Mr. Eastham) and for Heywood and Middleton (Mr. Callaghan). I fully understand the concerns and needs of the constituents of the hon. Member for Stretford, and his commitment to them.

The Government accept that job losses have occurred in Trafford park and that the unemployment rate in the Manchester travel-to-work district is higher than any of us would wish it to be. However, without wishing to minimise the problems—no Government Member wants to do that —I note that the rise in unemployment in the hon. Gentleman's constituency during the past two years has been less than in the north-west region as a whole, where the rise has been less than in the rest of the United Kingdom. There is no doubt that unemployment is not just a matter for local or even national concern: it is an international problem. More than 15.75 million people are currently unemployed in the 12 countries of the European Community. In the latest three-month period, unemployment has risen in all EC countries except Germany. In France it has reached its highest level ever, and it is also a problem outside the Community—the United States of America has its highest unemployment rate for five years.

However, although as in those other countries the United Kingdom's unemployment level is increasing, there are clear signs that the rate at which it is rising is diminishing. The average increase in the three months to April was the lowest since the three months to September 1990.

There are also grounds for cautious optimism in the wider economy. Surveys conducted over recent weeks show increasing confidence among consumers and businesses. The prices of goods leaving the factory gates are at their lowest for four years.

The hon. Gentleman asked for a co-ordinated approach. There is a co-ordinated approach throughout the Government. It is important not only to create the right climate, but to ensure that interest rates are reduced. Since we joined the exchange rate mechanism in 1990 there has been a 5 per cent. decrease in interest rates. There is a co-ordinated approach, not just from the Department of Employment or the Department of Trade and Industry, but from Treasury.

I fully realise that the job cuts announced by Massey-Ferguson, GEC and the other companies mentioned by the hon. Gentleman will be a loss to the Trafford park district. As in almost all cases where workers stand to lose their jobs, I am sure that there are arguments, some more valid than others, that can be mounted against the cuts. Ultimately, such decisions are for the commercial judgment of the companies involved. It would be counterproductive for the Government to interfere. It is relevant that neither set of job losses is to take place immediately, and the companies have offered considerable help to their employees, including the chance to move to other parts of the country—although I realise that that option does not suit everyone. I understand that the local employment service is in touch with the companies and with Texaco, and is offering help—although I stress that the majority of the job losses have not yet occurred.

It would be wrong, however, to allow the impression to gain ground that all is doom and gloom. Far from it. The job losses are by no means the full picture. There is a brighter side. New investment is being attracted to the area, and jobs are being created. In particular, I wish to highlight the work of the Trafford Park development corporation, one of the 10 urban development corporations in England and Wales that aim to encourage investment and bring derelict land and buildings into effective use. I was pleased to hear the hon. Member for Stretford pay tribute to the vast amount of work that the corporation has done, and I hope that co-operation spreads across all parties in the Manchester area.

A survey commissioned by the Trafford Park development corporation has shown that, in its five years of operation, 460 new companies have located their business in Trafford park, and that in the same period an additional 9,500 jobs have been created—an increase of nearly 40 per cent. on the 1987 figure. That is particularly encouraging, as is the fact that the highest level of employment in Trafford park is in the engineering sector and 48 per cent. of all employees are in manufacturing.

I readily accept what has been said about the importance of manufacturing; I also accept that there is a need to ensure that skills and training play a vital part in industry. That, however, is part of a wider debate, and we do not have time to discuss it fully tonight. Perhaps we shall be able to do so tomorrow.

Two noteworthy investments in Trafford park should be recorded—no doubt the hon. Member for Stretford and his hon. Friends are familiar with them. I refer to Proctor and Gamble's multi-million pound development, which will create 250 new jobs, and British Rail's choice of Trafford park for its £11 million channel tunnel freight terminal, which could create up to 4,000 jobs in the area. Those are substantial investments, which are important to the future of the Manchester area.

I also note that the development corporation has recently announced a package of planning permissions and investment decisions, which should create 1,600 jobs, as well as possible construction jobs. Moreover, although they are not in his constituency, I am sure that the hon. Gentleman will welcome some of the other major developments in the Manchester area. They include the new metro supertram system, which is now operational and has created over 100 jobs—and which was funded by the Government; the airport's second international terminal, which will double its capacity; and the attractive leisure and office developments at Salford quays.

I am sure that we all welcome the decision to provide £55 million to support Manchester's bid for the Olympic games in the year 2000. It will be used to provide an Olympic arena and other sports facilities. If, as we all hope, Manchester's bid is successful, there will be a wealth of opportunities for new employment.

Despite those successes in creating jobs in the area, there are—and will continue to be—unemployed people who need help. The Government are now providing a wide and versatile range of help for such people, much of which is channelled through the employment services and the training and enterprise councils—or TECs, as they are more familiarly known. Our overall aim is to provide help which is tailored to the individual and meets his or her needs, and which enables such people to find the most suitable employment—including self-employment—as quickly as possible.

All newly unemployed people are offered positive help on the road back to employment by the employment service's new client advisers. Such help includes news of the availability of vacancies, alternative employment, training opportunities and employment service initiatives. The adviser also helps such people to draw up a back-to-work plan that charts the best course of action to enable that person to get back to work.

Those who have not found work within 13 weeks are offered further interviews and help. In the year ending March 1992, in the Manchester central employment service area—which covers the constituency of the hon. Member for Stretford—nearly 64,000 such interviews with claimant advisers took place. Those interviews have helped over 8,300 people to find jobs or other positive outcomes, such as training or job clubs. I think it important to address training and retraining, and to provide opportunities for people to take advantage of those facilities.

Mr. Eastham

We are grateful for any innovations, but certain established industries in Trafford park, such as traction, are not being used. The Minister referred to the success of Metrolink, but some of the work was done in Milan and one wonders why it was not possible to do it in this country.

Mr. McLoughlin

The hon. Gentleman tempts me to go further than I wish to go now. He ought to address that question to the people who were responsible for constructing the supertram. He should ask them why they did not feel that it was either possible or right to buy British products. I accept that it is a relevant question, but I cannot answer it this evening.

Mr. Tony Lloyd

rose—

Mr. McLoughlin

I do not wish to be diverted down this path, but I shall obviously give way to the hon. Gentleman.

Mr. Lloyd

The traction for Metrolink was made in Trafford park. I should hate the public to be under any illusions about that.

Mr. McLoughlin

I am grateful to the hon. Gentleman. That is why I do not want to go down that path now. There are wider questions, to which the hon. Member for Blackley referred.

As for the services that are in place to try to help people to find jobs and to help those who are unemployed, we have job clubs, job interview guarantees, job review workshops, job search seminars and other employment service initiatives to help the unemployed to identify employment and training opportunities. They are all available to the hon. Gentleman's constituents and to people elsewhere in the Manchester area.

The full range of the Government's training and enterprise programmes are also available to the hon. Gentleman's constituents, including the youth training scheme for 16 and 17-year-olds, employment training and employment action for unemployed adults, and help in some cases with business start-ups.

The training and enterprise measures are delivered through the Manchester training and enterprise council, one of the 82 training and enterprise councils now fully operational in England and Wales. The successful completion of the network means that we now have in place an unprecedented partnership of Government, business and individuals, with over 1,200 front rank business leaders across the country serving on their local TECs. All that is backed by more than £2 billion of Government funding. We believe that this partnership is the best way to skill Britain for the 1990s and beyond.

We are taking the provision of skill training and the encouragement of skills very seriously. However, the sole purpose of the TECs should not be thought to be the delivery of Government programmes, important though that is; they have a much wider role. For example, as part of its objectives concerning training for the adult unemployed, Manchester TEC has a number of local, specially tailored initiatives. Skillplan is a guidance, assessment and referral service for unemployed people. Skillplan operates through 12 main sites and on an outreach basis through selected jobcentres.

Manchester TEC is also collaborating in a project in Trafford park aimed at improving employment and training prospects for ethnic minority women. This initiative stems from the fact that there is very low take-up of adult training provision among Asian women. The idea of providing a series of courses prior to taking up employment training or prior to a job itself was the idea of a member of the Asian community.

Another idea that Manchester TEC is pursuing is Manchester TEC/1000. This is another locally grown initiative, aimed at improving the training and employment prospects of 1,000 disadvantaged people, many of them living in areas of social and economic deprivation. There are two promoters for Manchester TEC/1000 in Old Trafford and one in Partington. They have already arranged training, employment, or referrals for 40 of the 124 individuals who have approached them for help in the last six months. I am sure that people welcome these initiatives, because they are important.

In conclusion—

The motion having been made after Ten o'clock, and the debate having continued for half and hour, MADAM DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at eight minutes past Eleven o'clock.