Footwear Industry (Norwich) (Hansard, 15 March 2001)

A publication in 2000 entitled "Norfolk Century", from the presses of the Eastern Daily Press, records that

the rise and fall of the Norwich footwear industry is something that lingers in the memory of many, even at the turn of this new century. 1285 Forty years ago, there were nearly 30 shoe factories in Norwich, but by the late 1990s, just three of any significance remained. A growing flow of cheaper imports from other parts of the world is generally blamed for the industry's demise. It is certainly not a symptom of Labour Government policy, as a Conservative spokesman recently implied in Norwich, South.

Women's and children's high-class footwear was the foundation of the Norwich footwear industry. The Norwich industry reacted well to the craze for dancing shoes, be they ballet shoes or shoes to enable the wearer better to quickstep or to waltz. The footwear was used in many dance halls across the country, and Norwich certainly had the market. Then came the fashion shoe. The Norwich work force, who were mainly women, rose to that challenge. To be a clicker was to be skilled, proud, a woman and employed.

In the late 1960s, when I first arrived in Norwich, some 10,000 people were employed in the footwear industry. Norwich was not just about Norwich Union, but about firms such as Start-Rite, Bally, Norvic, Shiglo in Thetford, Sexton and Everards. Through the 1970s, the work force was reduced to some 6,000, as imports poured into this country. Despite a rare showing of trade union militancy in Norfolk, where there were marches, sit-ins and factory occupations—which were often sparked off by the ebullient Clive Jenkins and the Association of Scientific, Technical and Managerial Staffs union—the industry went under. There was a famous sit-in by 12 women in Fakenham, a small Norfolk town. It gained admiration right across the world.

Pell Footware, Trimfoot, Sextons and K Shoes closed in rapid succession, and in the 1980s Norvic disappeared. Start-Rite, whose shoe factory is still in Norwich, survived thanks to a policy of concentrating on children's shoes at the top end of the market, for which there was a growing export trade. Florida shoes concentrated on wider fitting shoes, which were popular among older and better-off women.

I initiate this debate not as a true romantic, which I am certainly not, but in real anger that England's oldest shoemaker, Start-Rite, in a bid for survival, has just announced the redundancies of 100 operatives and workers in my constituency. It is hoped that that will save the remaining 250 jobs in Norwich and 350 retailing staff around the country.

The company said that it has to follow its competitors and place work abroad because of rising United Kingdom labour costs and falling prices in the marketplace. Another reason it gave, which I find fascinating, is the collapse of the infrastructure that supported the industry. It also made the brilliant deduction that children were becoming more fashion-conscious at an earlier age.

It is argued that it is difficult to get UK lasts and wax models used in the shoe manufacturing process. Nowadays, young people have mobile phones and computers, and are indeed fashion conscious. They wear Nike shoes and Dr. Martens. They are influenced by the David Beckhams of this world and the Spice Girls, and rarely by Cliff Richard, although other people may be. Cabinet Ministers may some day influence the fashion market with their shoes—who knows. A pair of Kinnocks might become quite fashionable—sturdy, reliable and solid.

1286 Meanwhile, the work in Norwich has been moved to India. The attachment of uppers to the shoe sole—the making operation, as it is called—will stay in Norwich. I note that footwear bosses in Norwich say that their factories are third-world, that the factories in India are way ahead of those here, and that labour costs are much too high in this country. One wonders what that implies for the labour costs in faraway lands such as India, even if they deny that they use cheap labour.

The industry's traditional approach has been the "nothing we can do about it but lie back and take it" syndrome. Others in the shoe industry have taken a different approach An article in The Independent yesterday refers to two entrepreneurs, Marc Verona and David Conibere, who in 1995 saw a gap in the men's shoe market in this country for Italian shoes, and are now selling 800,000 pairs a year with a turnover of £16 million. They said that they had identified ordinary guys who weren't fashion victims. They liked football and beer, and they didn't want their mates to take the mickey out of their shoes. That was hardly rocket science. It is was a fairly obvious observation, and they took the initiative. They talked about getting a buzz when they sell a shoe through their clever advertising and clever promotion, and about having the right product.

I guess that the people who discovered Dr. Martens would say the same thing: they saw something in which many young people would be interested. There are crowds of people in shops trying on all the different Dr. Martens and hoping that they will be in the fashion arena.

There is nothing shattering about designing and making shoes if one has entrepreneurial spirit. In Norwich, we have brilliant people—young and not so young—with street cred, some of whom work and make designs at the local art school. Have the captains of Norwich's footwear industry ever thought of putting such people on their boards, or on an advisory group or taskforce? Why does the East Anglia regional development agency always seem to talk about the entrepreneurial spirit in terms of biotechnology? The shoe and footwear industry would also benefit from the development of that spirit.

Where was the RDA when those 100 jobs were lost at Start-Rite? What did its members say? There was absolute silence from the RDA. What has happened with Start-Rite in Norwich amounts to a challenge for the RDA. I hope that it has not written off the footwear industry, and that it is prepared to devote some effort to its promotion.

Norwich produces bright people. My right hon. Friend the Chancellor of the Exchequer learned about neo-classical endogenous growth theories from a Norwich-born lad, who has thus helped to develop the stable economy of which we are so proud today.

There is no need for the footwear industry to leave Norwich, but it needs support. Britain leads the world in fashion and the design of clothes and other goods. We have bright and creative people who could do the same in the shoe industry, but their talent is not being used in Norwich.

I hope that my hon. Friend the Minister will step in and ask the RDA to sit down and work out a plan for the whole industry. The industry is capable of creating products that would certainly be fashionable. Their manufacture would utilise the skill of the work force in 1287 Norwich and Norfolk, and the industry would benefit from the risk-taking adventurism of our young and talented Norfolk people.

Not everything to do with fashion has to happen in London. It seems to me that Norwich's time has come. The Government should say as much and take the initiative by pulling together all the relevant groups. In that way we could exhibit in the footwear industry the entrepreneurial, innovative spirit that is evident in the biotechnology being developed in Norwich.

There are many talented people—many of them women—who are crying out to use their ingenuity in the design of the sort of shoe that people want to wear. People do not wear three pairs of shoes a year any longer; they wear 12. Why are they labelled "Made in Brazil", "Made in Italy" or "Made in North Korea"? Why have we lost the label that used to say "Made in Norwich"?

§ The Minister for Small Business and E-Commerce (Ms Patricia Hewitt)

First, I congratulate my hon. Friend on securing this important and timely debate on the future of the footwear industry in Norwich. He has explained most eloquently the problems facing the industry in general, and the companies in Norwich in particular. He made special reference to the Start-Rite company.

I represent a constituency in the city of Leicester. In the past, that city was also a centre of the United Kingdom's footwear industry. Like my hon. Friend, I have witnessed the decline of employment and production in the industry. Footwear is still manufactured in Leicester and Norwich, but it is increasingly difficult even there to buy a shoe that is made in Britain.

I am especially sorry to hear about the job losses announced by Start-Rite in Norwich. Like many parents, both in the House and outside it, the first pair of shoes that I bought for both my children were Start-Rite shoes. I continued to buy my children shoes from Start-Rite and other well known British manufacturers until they—like the young people described by my hon. Friend—insisted on a variety of high-fashion designs, in which fashion and styling were more important than the source of the product.

I stress that the Employment Service, the local council and other agencies will do everything that they can to ensure that workers facing redundancy secure new jobs—and, if necessary, the new skills that will enable them to secure new jobs—as quickly as possible. I understand that the Employment Service in Norwich has already contacted Start-Rite to discuss the possible redundancies.

I am glad to say that a wide range of vacancies is available in the city. The Employment Service stands ready to help any staff member who will be made redundant if Start-Rite proceeds with the proposed restructuring. The Employment Service will offer a range of services, including advice on benefits and information and help with available vacancies and training if that will open new possibilities for re-employment.

Anyone who is made redundant will have immediate access to work-based learning for adults, which would normally be made available only to people who have been unemployed for more than six months. Of course, if any of the redundant workers are aged between 18 and 24, they will have early access to the new deal.

1288 The other practical offer that the Employment Service has made in Norwich is to look at the suitability of staff who might be made redundant for jobs in two local companies that are currently recruiting. We will also ensure that help from other agencies for people who face redundancy is co-ordinated through the local redundancy advice network.

I know only too well from personal experience, as well as from the experience of many of my constituents, how painful and stressful it is to face redundancy. I hope none the less that my hon. Friend will be able to reassure those of his constituents who face possible redundancy that good-quality help is available—help that has been proven in redundancies in many parts of the country—and that re-employment prospects are good. The Norwich economy as a whole is thriving. There, too, as in the rest of the country, significantly more people are in employment than four years ago. Therefore, unpleasant and painful as any redundancy is for the individuals concerned, there is every indication that people such as his constituents with very good work experience and solid technical skills will be in strong demand.

Having said that, I hope that Start-Rite will continue to be an important employer in Norwich and to contribute to the local economy and that it will develop its investment, products, design and marketing so as to remain an important feature of both the British and global footwear market.

Unfortunately, in business life, firms have to reduce the work force, just as, on occasion and more happily, they are able to increase their work force. I understand that Start-Rite says that it has taken a number of years to come to that decision, which suggests that it was not lightly taken and that it was taken to protect the remaining 250 jobs in Norwich and the larger number of retail jobs that depend on the company. I was pleased that, more positively, the company announced a new business opportunity connected to the nationwide distribution of its shoes within Adams Childrenswear shops.

As my hon. Friend has said, the Start-Rite brand is part of a very old British heritage. Start-Rite still has, and, I hope, will continue to have, many enthusiastic customers both here and worldwide. It has a strong brand to build on. I wish it every success in its efforts in continuing to compete in what is an increasingly competitive marketplace.

I am pleased to be able to tell the House that Norwich City council has already contacted the company to offer it a meeting with the main local and regional organisations offering services that are relevant to Start-Rite: for example, those relating to training, innovation and exports. An official from my Department will attend that meeting, so that we can ensure that the company is aware of all the measures available to it within its industry.

It is fair to say that the company has taken advantage of and benefited from some Government programmes already. In particular, it enjoys the support that is made available by Trade Partners UK for exhibiting at overseas trade fairs. In a related sector, textiles and clothing, we have already been able to expand the support that we give for overseas trade shows, to help it to build up its export markets.

Start-Rite was also one of four British footwear manufacturers that was benchmarked against the Italian footwear production system in a recent Department of 1289 Trade and Industry-supported project. I am glad to say that that project's findings and recommendations have positive implications for continued United Kingdom manufacture for Start-Rite, the other three companies that participated in the study and other United Kingdom footwear manufacturers more widely. Through their trade association, we are ensuring that they all receive copies of the report and the encouragement to learn the lessons from that.

As my hon. Friend said in his very vivid account of footwear manufacture in Norwich, the route to success these days is for companies to upgrade their design so that they combine an excellent quality of manufacture and particular attention to the needs of children's growing feet with the type of leading-edge, fashion-conscious and modern design and styling that children demand at an increasingly early age.

That is one of the routes to success; another is in finding those niche markets where British companies continue to succeed. My hon. Friend referred quite rightly to the manufacture of ballet and dance shoes, of which Freed—another company from his city—is one of the world-leading manufacturers. Similarly, the Florida Group is investing heavily in machinery, a new product range and, I am particularly glad to say, e-commerce. I wish those companies as well as Start-Rite continued success.

As my hon. Friend said, there has been a very long process of contraction in production and employment in the UK footwear industry. Despite that, and despite the very difficult exchange rate against the euro, the sector continues to be buoyant. There has been an increase in exports, which are now more than half of total United Kingdom production. In addition to the two Norwich companies that I mentioned, other companies are surviving and in some cases thriving quite well by concentrating on high-added-value niches—such as designer, street fashion, Goodyear Welted and children's fitted shoes.

My hon. Friend also mentioned the importance of design, and I entirely endorse those comments. Our fashion and arts colleges continue to produce a steady stream of absolutely world-class designers. There are high-profile graduates from Cordwainers college—which is now part of the London college of fashion—including Patrick Cox, who is one of our highly successful younger footwear designers.

We have strengths also in manufacturing, from Dr. Martens to high-bracket City shoes such as Church's, Crockett & Jones, Edward Green, Grenson and Tricker. Goodyear Welted construction is world renowned. Clarks, like Start-Rite, has a very strong reputation particularly for high-quality children's shoes. Recently, I had the opportunity to meet representatives of Griggs, which is the company behind the Dr. Martens brand, and I was able to discuss with them its strategy for dealing with the competitive environment in which it—like every other company in every tradeable sector—finds itself.

We also have strengths in technology. Two of the leading computer programmes that provide technology for footwear production are of British origin.

Therefore, my hon. Friend's comments on the long-term contraction of the industry are right. Clearly we are not going to be able to go backwards in this or any 1290 other industry. At the same time, industries and companies that are facing those enormous changes from globalisation and technological change, and from changes in the consumer market itself in the United Kingdom as well as abroad, need constantly to be reviewing their own strategy and their own investment to find the parts of the marketplace in which they can continue from a British manufacturing base to succeed both in the UK market and abroad.

As I indicated with the examples that I have given, footwear manufacturers can continue to succeed and be profitable by concentrating on design and quality, particularly when they are in those high-value-added sub-sectors or niches.

We have to recognise that 90 per cent. of demand in our footwear market is currently met by imports. Manufacturers have difficult decisions to make about how they spot the trends in taste in their consumer market and about how much, and which parts of their manufacturing, to source in the United Kingdom. Of course, footwear is by no means the only sector in which those difficult decisions have to be taken. One of the most competitive markets is in trainers, in which most of the best known brand names originate from outside the United Kingdom. Even there we have in New Balance in Cumbria a manufacturer—the only UK manufacturer—that is succeeding in the trainer market and has been increasing its production for sale in both the United Kingdom and Europe.

Other companies have succeeded with street fashion styles and retro-styled models. My hon. Friend may remember winkle-pickers from his earlier days; I understand that they are selling extremely well in Japan, even if they have rather a small following in the United Kingdom.

We will continue to work closely with the footwear industry in ensuring that companies are helped to identify those niche markets, to find where they can add value, to improve their styling and marketing and to adopt strategies that will succeed. We have been working with the industry-led footwear liaison action group and also with manufacturers and the unions, particularly the National Union of Knitwear, Footwear and Apparel Trades—KFAT—to develop an effective strategy for the industry. That includes looking at how we can more effectively link our outstanding designers with our manufacturers. That is relevant for the textile and clothing industries as well. If the footwear industry wants to make proposals for grant aid from my Department for programmes that could more effectively link our designers with our manufacturers, we will be happy to consider them in the normal way under the Department's innovation budget.

As I indicated earlier, there have been successes in the industry, including the success in expanding export markets. We will continue to ensure that support is available and made known to the footwear companies to get them into those trade fairs overseas where they can grow new markets.

Finally, let me return to the broader labour market in Norwich. There are, I am glad to say, a number of firms in a variety of sectors that are investing in my hon. Friend's city. Virgin One is recruiting 250 extra workers as part of its expansion programme. Marsh, the Norwich-based insurance company, will be creating 100 more jobs in the 1291 city, with recruitment beginning shortly. A call centre for Central Trust, another expanding financial services firm, will create 200 new jobs over the next 10 months. Other companies in my hon. Friend's constituency have recently created many more jobs as well.

There is the proposed expansion of Norwich airport and there are plans for the retail sector to expand in the coming year. Norwich research park has a concentration of expertise in plant and food science, to which my hon. Friend referred. Indeed, it contains western Europe's largest concentration of expertise in plant and food science, bringing together the university of East Anglia, the John Innes Centre, the Biotechnology and Biological Sciences Research Council, the Ministry of Agriculture, Fisheries and Food's research laboratory and the British Sugar Technical Centre. More than 1,000 scientists, researchers and technicians are undertaking world-class research in the connected areas of food, nutrition, human health and the consequences of climate change. I am 1292 pleased to say that the East of England development agency is supporting the foundation of an incubator centre for small businesses on the research park.

I have never been one to argue—as many have over the last year—that the new economy is replacing the old, that high-tech industries and services are the only ones with a future or that our traditional manufacturing industries, such as footwear, are doomed to an inevitable decline. I do not accept that for a minute, and I believe that the examples of the many successful footwear companies to which both my hon. Friend and I have referred underline the fact that, in this fast-changing world, companies in every sector of the economy are having to adapt to new ways of producing things and the need to create, design and market new products.

The companies that are succeeding and will succeed in footwear, as in other sectors, are those that innovate—those that have entrepreneurial drive. We will back them, and ensure that they continue to succeed.