HC Deb 22 March 1995 vol 257 cc338-41
9. Dr. Reid

To ask the Secretary of State for Scotland what discussions he has recently had with the chairman of Scottish Enterprise on the Scottish economy; and if he will make a statement. [13634]

Mr. Lang

I regularly meet the chairman of Scottish Enterprise to discuss a variety of issues relating to the Scottish economy.

Dr. Reid

The performance of the Secretary of State on the Scottish economy can be summed up in two words—

Mr. McMaster

Which two?

Dr. Reid

They are not the two that my hon. Friend is thinking about—they are Rolls-Royce.

I remind the Secretary of State that, although Ministers may have forgotten Rolls-Royce, Opposition Members have not. Does he realise that there will be, not only a loss of jobs, important though that is, but a potential loss of skills at the forefront of technology from Scotland and the United Kingdom to Germany? If the Secretary of State is not prepared to do anything, will the Government and the bunch of pathetic Ministers who have sat idly by while Rolls-Royce has been sold down the tube in Scotland move aside and make way for those of us who will do something about it?

Hon. Members

Hear, hear.

Mr. Lang

If that is a threat that the next Labour Government, if ever elected, would interfere in every commercial decision made by every company in this country, I am sure that the electorate will take note of that and react accordingly.

Rolls-Royce, like all companies trading internationally and needing to trade competitively, has to take commercial decisions to adjust its dispositions, the activities in which it is involved, the people it employs and the places where it employs them, to ensure that it does that in the most effective and competitive way. That does not alter the fact that 4,000 employees will remain at six Rolls-Royce sites in Scotland.

On the economy in a broader sense, I hope that the hon. Gentleman is encouraged that unemployment in his constituency has already decreased by no less than 650 in the current year.

Mr. Bill Walker

Does my right hon. Friend recognise that Rolls-Royce, among others, has made massive investments outside the United Kingdom? Does he further recognise that Rolls-Royce has recently acquired Alison Engines in the United States, thus making Rolls-Royce one of the three largest, if not the largest, aero-engine manufacturers? That can only be good for Scotland, but it could all be put at risk by the nonsense of an assembly with tax-raising powers that would drive further jobs away from Scotland.

Mr. Lang

My hon. Friend is right. Rolls-Royce operates in an international, competitive marketplace. Its two major competitors, General Electric and Pratt and Whitney, have had massive job cuts, including the 14,000 redundancies announced in 1993. At the same time, Boeing announced 80,000 job losses. It is an inevitable part of the developing economic situation and the competitive nature of those industries that they have to adjust the size of their work force from time to time.

Mr. Watson

The description of the economy that the Secretary of State and his friends give would not be recognised by any of the 4,339 people in Glasgow, Central constituency who are unemployed and eligible to claim benefit. That figure constitutes 15 per cent. of the working population, and at a cost of £9,000 per person that means that £39 million is paid per year to keep those people in my constituency on the dole. When will the Government understand that, instead of talking about the so-called flexible labour market, which means part-time jobs and insecurity, they should start spending money on the economy, on training and on infrastructure, to get people back to work instead of keeping them on the dole?

Mr. Lang

That is what is happening. The number of people in work in Scotland has risen by 60,000 in the past decade. In the hon. Gentleman's constituency, since January 1987, unemployment has fallen by 3,400. Unemployment in Scotland is now, for the first time since records have been kept, lower than elsewhere in the United Kingdom, which in turn is more than two points lower than the European average.

Mr. Peter Bottomley

On a subject which is on a different scale from Rolls-Royce, would my right hon. Friend welcome the reputation of Lanark blue cheese? No food poisoning cases appear to have been attributed to that cheese and we must try to ensure that there is no interference in that good Scottish enterprise.

Mr. Lang

I am happy to accept my hon. Friend's commendation of that fine Scottish product. It is one of many fine Scottish food products that are gaining an increasing market share outside Scotland. I am sure that my hon. Friend's remarks will have been heard by those responsible for handling the matter.

Mr. Salmond

When will the Secretary of State take action to protect Scotland's economic Infrastructure? Is he aware that last week his colleague the Secretary of State for Transport compared the subsidy to Motorail and sleeper services in Scotland to the subsidy for passengers in the south-east of England? Will he inform the Secretary of State for Transport that £1.5 billion was spent on capital and investment grants in Network SouthEast and London Underground in this financial year compared with, at most, a few million pounds on the sleeper and Motorail services in Scotland? What hope is there for a consultation exercise when the rolling stock is stuck up a siding, the Secretary of State for Transport has already made up his mind and the Scottish Office team is in a state of paralysis, unable to defend Scottish interests?

Mr. Lang

I suppose it demonstrates the narrowness of the hon. Gentleman's horizons that he cannot understand that cash invested in rail infrastructure south of Scotland also benefits Scotland. The £300 million upgrading of the east coast main line benefited Scotland and the £600 million investment plan for the west coast line will benefit Scotland. The other resources that have been brought into Scotland benefit Scotland. It is a measure of the short-sightedness and narrow-mindedness of the Scottish National party that it does not understand the benefits for Scotland that accrue from the services such as Mossend and the channel tunnel. Those are economic infrastructure developments that have been made under this Government for Scotland's benefit.

Mr. McFall

The Secretary of State will be aware that Scottish Enterprise has trumpeted the strategy of high-quality, high-skilled jobs. When he next meets the chairman, will he discuss the scandal of low pay in Scotland, where one in 20 of the working population works for poverty pay? Does he think that it is fair that 107,000 people in Scotland work for £2.50 an hour while the heads of privatised utilities like British Gas earn £250 per hour? Has not that unfairness, whereby the rich are getting richer on the backs of the poor, resulted in the rejection of the Government's economic policies? When will the Secretary of State start to do something in economic terms for the ordinary people of Scotland?

Mr. Lang

The people of Scotland will not recognise the picture painted by the hon. Gentleman. There are many high-paid and well-qualified jobs in Scotland in a far richer and more diverse economic infrastructure than ever existed under Labour. Perhaps that is why net disposable incomes in Scotland are among the highest in the United Kingdom.