HL Deb 15 July 1958 vol 210 cc1034-51

2.52 p.m.

Order of the Day for the Second Reading read.


My Lords, this Bill is designed to give to the Government powers to assist people to establish themselves in areas where there is high and persistent unemployment. The concept of a duty to give special assistance to areas of unemployment has been accepted by Parliament for a quarter of a century. It found perhaps its first legislative embodiment in the Special Areas (Development and Improvement) Act, 1934. That was the Act which provided for the appointment of Special Commissioners (one for England and Wales and another for Scotland) to organise" measures designed to facilitate the economic development and social improvement" of the areas under the general authority of the Ministry of Labour. We pray that never again will the country be faced with unemployment on the frightful scale suffered in the 'thirties, when the national rate rose to over 20 per cent., and when there were places such as the Rhondda and Jarrow where unemployment rose tragically to over 70 per cent.

But the new approach which began with that legislation has continued.

It was before the war that the Royal Commission, under Sir Montague Barlow, was set up to report on the distribution of the industrial population. The recommendations of the Barlow Report were largely accepted by the Government in the White Paper of 1944 on Employment Policy, which is the foundation of the Distribution of Industry Acts. That White Paper declared that it would be the object of Government policy to secure a balanced industrial development in the areas which had in the past been unduly dependent on industries specially vulnerable to unemployment. In the following year what I may call the parent Act to this Bill was passed—the Distribution of Industry Act, 1945. The fairly loose control exercised in the 'thirties by the Special Commissioners over industrial estate companies and the financial assistance given through the semi-official Special Areas Reconstruction Association were succeeded by more closely defined powers operated under the Central Government.

The Act gave the Board of Trade powers to acquire land, to build factories and other buildings for letting to private industrial undertakings, and to Her Majesty's Government to provide transport facilities and other basic services. It also gave powers to clear derelict sites, either for amenity reasons or to provide sites for industrial development. Lastly, it authorised the Government to make grants or loans, in accordance with the recommendations of an Advisory Committee appointed by the Treasury. But the scope of all these powers was limited to the development areas from time to time scheduled to the Act. Outside those development areas there are no comparable powers to assist the relief of unemployment by the expansion of new industry. It is this gap which it is the purpose of the present Bill to fill.

The Distribution of Industry Acts have, I think your Lordships will agree, worked, very well during the thirteen years of their operation. However, over these years the pattern of unemployment in the country has undergone a change. There are some places in the development areas where, largely thanks to the use of the powers under the Act, unemployment has dropped. Indeed, the Government-financed factories in the development areas are at present providing work for nearly 200,000 people. This takes no account of the work provided by firms persuaded to go to these areas without Government assistance; nor does it take account of the indirect employment given in the distributive and other service trades. Nevertheless, there are other places, outside the development areas, where unemployment has become high and where we fear it may continue to be high. In the Government's view, it is no less important to be able to assist these places than to be able to assist the development areas.

What this Bill proposes is that the powers given to the Treasury under Section 4 of the parent Act to make grants or loans to industry in the development areas should be extended so as to be available, both inside and outside development areas, in places where the Board of Trade are satisfied that the money is required for something which would help to provide employment in a place suffering from a high rate of unemployment which would otherwise be expected to continue. In another way, also, the Bill extends the Treasury's present powers to give financial assistance. At present, grants or loans can be made only to industrial undertakings, but there may be other types of project which would provide useful employment and ought not to be ruled out—for example, offices or hotels. The Bill, therefore, will widen the scope of the parent Act by extending the powers to make grants or loans to undertakings engaged in trade or business. It will be for the Board of Trade to say whether proposals put forward for assistance under the Bill will be likely to help reduce unemployment in a place where a high rate of unemployment exists and is likely to persist. They will, of course, act in close liaison with the Ministry of Labour.

Your Lordships will observe that there is no Schedule to the Bill setting out the list of places qualifying for consideration. The reason for this is that the Government wish to make this Bill as flexible as possible, and one which can be used with speed. We are dealing here not with what may be called areas of basic unemployment but with smaller and more widespread pockets of unemployment.

We need, therefore, to be able quickly to add to or delete from the list of places, and we are convinced that the usefulness of the Bill would be impaired if every change required legislative endorsement. Your Lordships will observe also that the powers to help these places of high unemployment are limited to the method of financial assistance by grant or loan. This again we regard as the most flexible method. The localities that we have in mind are widely scattered: to undertake factory building would mean that we should have to set up an uneconomic and unwieldy system of management. That would result in our adding to the Government's physical assets all over the country. We think that negotiated financial help will be the quickest and most adaptable way of encouraging the right projects in the right places while still leaving the initiative with private enterprise.

I ought perhaps to mention one other matter. Your Lordships will see that the Bill does not extend to Northern Ireland. The parent Act also did not extend to it. That is not because we are not powerfully conscious of the very serious unemployment problem in Northern Ircland—we are in fact, as your Lordships know, doing everything we can to alleviate it. Bat the Northern Ireland Government have their own legislation to enable them to assist industry wishing to establish itself over there. It would be unnecessary and confusing to duplicate those powers with powers given by this Bill.

Compared with the high unemployment rates before the war, or even with those of many other countries at the present time, unemployment in Great Britain as a whole is not at present a serious problem, and for that we may be profoundly thankful. It might become so—even if we do not talk ourselves into it—and Her Majesty's Government are concerned and watchful. But in June, the latest month for which we have figures, the average unemployment for Great Britain was only 2 per cent. At that level we can feel that the national economy is still pretty soundly based and responding satisfactorily to the financial controls which Her Majesty's Government are operating. Our concern is still with local problems rather than with a national one.

Although the general picture is by no means unsatisfactory, there are, as I have said, places of high and persistent unemployment which are causing the Government great concern. The problems in these places result from a variety of causes, ranging from a falling off of defence work (and here Greenock springs to mind) to alterations in building fashions—and here I have in mind the problem of slates in North Wales. The difficulties of the tinplate area in South Wales are also well known, and to none better than the noble Viscount, Lord Hall; a changeover from out-of-date methods of hand production to modern continuous automatic processes is the main cause of unemployment, though a fall-off in demand has aggravated it. I need not remind your Lordships of another example which was recently discussed in this House, the problem of Dundee and its jute indutsry. It is to deal with these problems that this Bill has been framed, and I commend it to your Lordships as a useful addition to the Government's armoury for relieving unemployment. It is one which the Government intend to use with speed and decision. I beg to move that the Bill be read a second time.

Moved, that the Bill be now read 2a.—(Lord Mancroft.)

3.0 p.m.


My Lords, your Lordships' House must be very grateful to the noble Lord for the clearness with which he has presented this measure. We shall not offer any opposition to this Bill; as a matter of fact, we welcome it, for it is an attempt to mitigate the increasing unemployment in some parts of the country outside the development areas which are therefore excluded from benefit under the Distribution of Industry Acts. The Bill is really an alternative to fully extending those Acts by taking just one part from the Act and applying it to those areas where the unemployment is, as the noble Lord described, excessive.

Until the present time the Board of Trade have been able to assist in providing employment by building advance and other factories and in building some industrial trading estates, as well as providing industrialists with loan capital where it could not be obtained from private sources. This Bill does not go nearly so far as that, for by far the most important provision of the Distribution of Industry Acts was the building of factories and the setting up of industrial trading estates with Government finance. There is no doubt that a large part of the new employment and production brought into these areas has been achieved by the construction of the factories. Indeed, it is estimated that 90 per cent. of the money which has been spent was to foster the building of these factories and trading estates. The figure given by the Parliamentary Secretary to the Board of Trade in another place on the Second Reading of this Bill bore out those facts. He said that the expenditure under the Act since 1945 for factory building amounted to £70 million. These factories provide employment for some 190,000 persons. That is over a period of twelve years.

The loans made under the Act—that is, the loans paid out by D.A.T.A.C., which means the Development Area Treasury Advisory Committee—totalled £6,900,000, which is an indication that if this Bill is to be limited solely to the advancement of loans and not to assist in the building of factories very little will be done to meet the unemployment which is growing in some of these areas. The Vote for D.A.T.A.C. for this year, 1958–59, is a mere £100,000, which is almost negligible if it is to carry out even action under this Bill.

I should like to ask the noble Lord, Lord Mancroft, whether the loans to be provided by this Bill can be applied in any way to the building of new factories including some advance ones. Also I would ask whether he can define the non-industrial undertakings which will qualify for assistance from these Government loans, and whether the Government have in mind any areas where there is very heavy unemployment, other than, say, the North Wales slate quarry area to which the noble Lord has referred, the Western Isles in Scotland where unemployment is at present 38 per cent., and Devon and Cornwall which have a considerable labour surplus except during the holiday season.

It is quite true that the average of unemployment in this country is very low, and we are all grateful and thankful that it is so. Those of us who lived in the distressed and special areas during the 1920s and 1930s trust that conditions of that kind will never be seen in this country again. But at the present time there are some areas where unemployment is fairly high, quite apart from the areas which I have mentioned. The average unemployment in Wales is almost 4 per cent. In Swansea it is 5.5 per cent., in Merthyr Tydfil it is 4 per cent. As the noble Lord rightly said, in Greenock, in Scotland, largely as a result of the defence programme cuts, it has risen to 7.8 per cent. This indicates that some of the development areas, apart from the areas which receive no benefit under the Development Act, will require further Government assistance to enable them to deal with this problem. I wish that the Government would extend the Development Act to areas where there is excessive unemployment. Let them have the full benefit instead of giving them just a sop.

When dealing with this Bill one remembers the distressed areas of the 1920s and 1930s and the excellent work done by the special area Commissioners such as Sir Wyndham (afterwards Viscount) Portal in South Wales, and Euan Wallace and others in other parts of the country. The Special Areas Act did a certain amount of good, but the war came. Afterwards, under the Distribution of Industry Acts of 1945 and 1950, South Wales, like many of the other development areas, benefited greatly. Until twenty years ago there were few factories in Wales. It was mainly an area of heavy industries—coal, steel, tinplates and so on. The suffering during that period was very great. In 1937 an estimate was given for a long-term target to deal with unemployment. That target amounted to the creation of 125,000 more jobs.

No one knows how many workers the new industries employ to-day, other than that in South Wales, in the development area alone, there are some 350 tenant firms occupying Government-financed factories on the five industrial trading estates—that is, Treforest, Bridgend, Hirwaun, Fforestfach and Wrexham—and on many other selected sites which employ large numbers of men and women. Indeed, the long-term target of 125,000 more jobs was exceeded some time ago, and this has brought a real revolution in these areas. Had it not been that advance factories or factories were built to receive industrialists who were prepared to bring industries down into these areas, I am convinced that not 25 per cent. of those works would exist in South Wales; and that would only mean, as it means at the present time, that the industrial areas would be depopulated to add to the over-populated areas in England where they hardly know what to do with the people they have. The Government should be as generous to the areas where there is at present unemployment and where there will possibly be more unemployment than there is, as they have been in dealing with the unemployment of the past.

There is still an attitude of reserve among some English industrialists, whose works are situated in large over-occupied areas, towards the idea of establishing factories west of the Border to Wales or north of the Border to Scotland. I should like to remind those industrialists of a speech made only last week by Sir John Pascoe, the Chairman of British Timken and South Wales Switchgear, a man of outstanding repute in the industrial world. At the opening of the works sports ground at Blackwood, South Wales, he said that the Switchgear Company had in sixteen years increased its number of employees from 25 to 1,600 and its factory space from 10,000 square feet to 300,000 square feet. Some of this had been done with the assistance of Government-built factories. The work done by the firm is highly technical and demands the highest standard of skill and application from the workers. Sir John further said that what this Company has done can well be followed by other companies in the whole of the County of Monmouthshire and in South Wales, where they will find that a force of workers can be built up and maintained which, under proper supervision and training, will be equal to that of any in Great Britain.

These areas should be encouraged by the Government by every means, and I hope that they will think again about assisting not only by loans after a huge expenditure has been incurred for the, building of factories, but also by building factories. My Lords, as I have said, we welcome this Bill as affording some small mitigation of the problem. We trust that it will do all that its sponsors say it will, and even more. If it can continue to give to the development areas and the new areas now suffering from excessive unemployment the same aid and the same measure of economic relief as did the Acts of 1934, 1945 and 1950, it will render a great service not only to the unemployed but to the nation. I hope that this Bill, if passed, will be administered with imagination, boldness and great generosity.

3.17 p.m.


My Lords, this Bill is very short, but in some circumstances it may be most important, because it empowers the Board of Trade to give substantial financial advantages to, private industry conducted for private profit in any area which the Board of Trade judges suitable for that purpose. My noble friend Lord Mancroft has reminded your Lordships that the first Bill setting up any kind of organisation, such as the Commissioners for the special areas, was in 1934; but I think that the first Bill which gave large financial inducements to private industry to go to the special areas was the Bill which became the Act of 1937. I had to move the Second Reading of that Bill in another place in April, 1937. The noble Lord, Lord Lawson, whom I am glad to see here, followed me from the Opposition Front Bench, and the noble Viscount, Lord Hall, was also sitting on the Opposition Front Bench in another place. He did not make an official speech for the Opposition in that debate, but he asked some helpful questions. At that time, I think, there were only three industrial estates in Great Britain. There was the Treforest Estate, in South Wales, for which Lord Portal was responsible; there was the Teme Valley Estate, in Durham, administered by Euan Wallace; and in Scotland, where the special areas were run by Lord Selkirk, there was the Hillingdon Industrial Estate which at that time had only just been approved and which this year is celebrating its twenty-first anniversary.

When I moved the Bill in 1937, the Labour Party were extremely kind to me, and most helpful and pleasant. The only troublesome critic I had in that debate was the then Member for Stockton-on-Tees, Mr. Harold Macmillan, who complained most bitterly that he would back the chances of any camel to get through the eye of any needle in preference to the chances of his constituency, Stockton-on-Tees, qualifying for any Government help under my Bill. The annoying thing was that I should have liked to make the Bill a great deal wider than it was, but I could not do so because I was only an Under-Secretary. So Mr. Harold Macmillan voted for the official Labour Amendment against the Government. It was not an Amendment for the rejection of the Bill, but one regretting that the Bill did not go a great deal further. So what I should like to know from Her Majesty's Government first is whether the present Prime Minister really approves of this Bill, for I am afraid that even under this Bill the Prime Minister's present constituency, which is a great deal grander than Stockton-on-Tees, is not very likely to qualify for any Government assistance.

I have always thought that the precise delineation of areas, whether they are called special areas, development areas or any other name, is a rather unnecessary handicap to Government policy in promoting greater diversification of industry, particularly in those areas where employment is over-concentrated on one type of work. The noble Lord, Lord Mancroft, has already said in his opening speech that to enable new factories to be built anywhere might be uneconomical and unmanageable—which I daresay is correct. But surely the Board of Trade might be allowed to decide this question as they decide the question of loans. Could not the Board of Trade decide whether it was uneconomic or unmanageable to build such factories in one area or another, just as, under this Bill, they can decide whether it is uneconomic or undesirable to give loans to factories in one area or another? I should like to reinforce the question which has been asked by the noble Viscount, Lord Hall: whether loans can be used for building factories.

The other question is this distinction, of which we have heard a good deal lately, between what are called "ready-made" factories and "tailor-made" factories. The Labour Government, under their administration of this Act, built a great many ready-made factories and then asked industry to occupy them. The present Government consider that in conditions where there is not such a strong sellers' market it may be better to provide "tailor-made" factories—that is to say, factories which are not designed until an industry has agreed to come to a certain site, when the industry is then asked to get an architect and to plan exactly the building it wants.

I am not arguing one way or another, for obviously there are arguments on both sides. It is like asking a man whether he would rather have a suit from Moss Bros., "off the peg", or go to a Savile Row tailor. If he is in a hurry, or cannot afford to pay for an expensive suit, he will prefer Moss Bros.; but if he can afford to wait and wants a carefully fitted suit, he may prefer to go to a Savile Row tailor. It is the same with factories under this Act. If we build "ready-made" factories that may make it easier for industrialists who are eager to come somewhere to come quickly. On the other hand, it may put off those industries which are inclined to be more "choosy" and will wait until we can give them exactly what they want. I am only asking for information, because in the debate in another place last week on Scottish industry the Secretary of State said that he might be going to reconsider this matter, and I wonder whether my noble friend Lord Mancroft may be able to give us further information on that point.

I do not see why Her Majesty's Government should not be free to do both—to build "ready-made" factories in those places where they want to get results quickly and believe industries would come; or to build "tailor-made" factories in places where it is felt that industries will not come unless they can get exactly the kind of buildings they want, designed by the architect they want. The noble Lord, Lord Mancroft, has been kind enough to mention the particular problem of Dundee. I will not go into it to-day, as we had a debate on it four weeks ago but I am grateful to him for mentioning it. I would ask him to remember that the great thing is not whether we have "ready-made" or "tailor-made" factories but whether there is planning in advance. We must plan now for the employment, or unemployment, situation that we expect in two or three years' time, and we have to go ahead now with servicing possible sites in areas where we expect heavy unemployment, giving them water, electricity and other services. If it is thought right to provide ready-made" factories I would ask my noble friend whether he can add anything to what was said on that subject last week during the debate in another place.

3.27 p.m.


My Lords, I wish to support the welcome which my noble friend Lord Hall has given to this Bill in his very factual speech to-day, and what was said in the somewhat humorous, imaginative and very useful speech by the noble Earl, Lord Dundee. The kind of thing that we are doing here to-day would have caused a rare commotion in either House some years ago. We had to learn from the experience of the depressed areas, of which my noble friend Lord Hall and myself had only too much. We learned that some areas in the country were somewhat "lop-sided" in their industrial arrangements. We had not thought about that before, even in the areas affected. The iron, coal and steel areas had been used to fairly regular employment, and consequently—and because they were so remote—factories did not come into those areas at the same rate as they had come to other parts of the country.

The main purpose for which I rise today is to point out that we have learned by experience. While we always desire certain areas to have more attention, I believe that if those who saw the old depressed areas could see them in recent times—if they were to have a vision of the kind of things we knew in those days of the 1930s, and saw those areas now, with the factories, and saw the different light upon the faces of the people, the different conditions and the different atmosphere—they would know that good work has been done in those areas.

The Government, of course, are acting quickly in this case to try to rearrange the balance in certain areas by helping to build factories, or at least by giving facilities for that purpose. Those who are responsible for the administration of this Bill, and those in the country who are more directly responsible for applying it, will find in some new cases that they have much to learn; and all I hope is that the Government will treat this Bill extremely seriously as a great discovery in our industrial experience, and that those in the areas affected will seek to know what has happened in other areas, so that they also can help the Government in building up these new areas.

I should like to add one further comment. I think that the Government need to watch very closely the over-building of factories in some areas, as well as the under-building. If I may say so, I feel that in this area of London shocking mistakes are being made—we learnt that during the war—and it is time that the Government, or some organisation, took a look at the situation around London, not only in the light of the effect of this kind of thing upon a vast city but also in the light of the needs of the other parts of the country.

3.32 p.m.


My Lords, I do not wish to detain your Lordships for more than a minute or two, but I should like, on behalf of my friends in industry and myself, to give a really warm welcome to this small but highly important measure. I agree entirely with what was said on that account by the noble Lord, Lord Lawson. The noble Viscount, Lord Hall, has told us, and indeed we all know, what admirable work has been done over the last years under the Distribution of Industry Acts—in the special areas before the war, and in the development areas since. But they have always suffered from the rigidity of the actual area and what happens inside and what happens outside.

Industry is alive and, because it is alive, some parts of it are progressing all the time and some parts of it are, of necessity, dying away as new developments come about. Therefore, in the nature of things, it is inevitable that pockets of unemployment appear from time to time in places in which there is not a general problem so that it is not necessary to apply the full development area procedure. It seems to me that this Bill is designed, and admirably designed, to deal with these pockets of unemployment. There are, of course, two methods by which help can be given, and I am glad to see that now Her Majesty's Government are applying both. One is to assist men who are thrown out of employment, especially those who have skills of one sort and another, to move by means of grants and aids of various sorts to where employment is available. That is, in certain circumstances, very valuable. Nobody, however, wishes to see parts of the country denuded of skilled men, and therefore we want something extra for these quick and sudden onslaughts of unemployment that come about from time to time in places where there may be plenty of factories, though they are not suited for new development, and where adaptation and expenditure of one sort and another may make a the difference.

I should like, in conclusion, to offer one warning. In so far as this Bill will be of general application, there will be, I am afraid, a great deal of pressure from various areas to see who can benefit most from it; and it will be largely in the hands of the Board of Trade to ensure that fair play is granted all round, and that no area suffers or benefits owing simply to the eloquence of its Member or its representative. I feel that this measure is going to stand or fall by the way it is administered. I hope, and I am sure that all of those in Industry hope, and believe, that it will be administered with the utmost fairness and generosity. I greatly welcome the Bill.

3.36 p.m.


My Lords, like my noble friend Lord Dundee I was concerned as a Minister with this topic of the distribution of industry, and in another place answered many questions and took part in many debates on this subject. My noble friend Lord Mancroft, in introducing this Bill, expressed the view held, I believe, in all quarters of the House—namely approval of the policy of the Distribution of Industry Acts, and satisfaction with the way in which, on the whole, those Acts have worked. In so far as this Bill is to remedy any omission or defect that has appeared, in the experience of the Board of Trade, in the working of those Acts the House will certainly give it a general welcome.

I have only two points on which I would seek some enlightenment from my noble friend. The first is some legal doubt about whether this Bill, though apparently an extension of the previous Acts, does not in certain respects rather go against their principle. Perhaps I can put the point most clearly by framing a question to my noble friend. How far have the Board of Trade to be satisfied that the proposed help will further the proper distribution of industry? The House will see why I feel some doubt if it will refer to paragraph (b) in Clause 1 of the Bill. There it is pointed out that the help can be given. whether or not that undertaking"— in the words of paragraph (b)is approved by the Board of Trade in pursuance of the said subsection (2) as complying with the requirements of the proper distribution of industry, If one stopped there it would look as if "the proper distribution of industry" had not to be present in the mind of the Board of Trade at all when they made a decision to help under this Act.

But if noble Lords will refer to the Explanatory Memorandum on this Bill they will find, in the final paragraph, that the Bill does not affect the operation of subsection (4) of Section 14 of the Town and Country Planning Act, 1947, under which industrial development certificates have to be issued by the Board of Trade as a condition precedent in certain cases. I hope that my noble friend, when he comes to reply, will explain the exact relationship between these words in paragraph (b) of Clause 1, which apparently give exemption to the Board of Trade from considering these requirements of the proper distribution of industry, and the continued operation of this provision in Section 14 of the Act of 1947, under which industrial development certificates must still be issued.

The other doubt I have about the Bill arises from the undefined and very general expression in the Bill "in any locality". Nearly every noble Lord who has spoken has referred to "areas", and, of course, if there is any substantial area in which there is high unemployment which is likely to persist, there is no noble Lord who would not desire that remedial action should be taken; but if you deal not with "areas" but with "any locality"—however small—then can it be said that the mere existence of persistent unemployment is necessarily an evil which has to be remedied? Is it not necessary that in some small localities employment may have to diminish if it is to increase in many others? What I fear is the administrative problem that the Board of Trade may have to face, which was alluded to by my noble friend who spoke immediately before me. The words in the Bill as they stand are so vague and so wide that there will be scarcely any Member of another place who will not press the Board of Trade to help some constituent under the provisions of this measure. Linder the previous measures there were more or less ascertainable tests that had to be complied with. Under this measure it seems to me that there are very few.

While I welcome the Bill, as do the noble Lords who have already spoken, because it remedies one defect in the previous measures—namely, the impossibility of helping any area outside the development areas—it seems to me that we ought to have some enlightenment on what are to be the requirements regarding the proper distribution of industry and what is meant by "any locality".

3.42 pm.


My Lords, the Bill specifically refers to covering an area within a development area "or elsewhere". The noble Lord who has just sat down and who speaks with such intimate knowledge of the Board of Trade has emphasised how wide are the proposals in the Bill. It is, I think, appropriate, in a Bill of this character and at this stage, to refer to something to which I hope the noble Lord, Lord Man-croft, will see fit to draw attention in the correct quarter. In all these cases of assistance and aid to industry the aim is to increase employment, and the underlying thought is that in increasing employment you are going to reduce the cost and therefore make the product more easy to sell. The point that I particularly want to raise is that where finance and assistance become available in this way to give additional employment and to bring lower costs, thought is often given only to the machinery which is to be used to employ the people.

The fact is that in many of our industrial areas in this country we are at a disadvantage compared with the Continent for a reason which is quite simple, namely, that on the Continent, both in France and in Germany, immense war destruction took place, as it did indeed in this country; but there the repair of buildings has been much more rapid and successful than here. I urge that thought be given to the fact that, in addition to bringing new machinery into play for the purposes aimed at in the Bill, attention should be given to the subject of specific or special assistance in the erection of new buildings. So much of our industry is in multi-storey buildings that it is impossible to compete economically with countries that have industry laid out in single-storey buildings covering a large area of ground. Until there is some supplementary aid such as is suggested in this Bill, it is difficult to see how industry will find a way of getting resources to provide buildings such as I have referred to—one-storey buildings instead of multi-storey buildings. Therein lies the double advantage of lessening the cost and bringing us into line with our industrial competitors, and of improving the amenities of the people employed in them.

3.45 p.m.


My Lords, the House has important business before it, and I will therefore be as brief as I can. I want to thank the House for the very friendly way in which this Bill has been welcomed. There are two or three questions which I think have recurred in most speeches. I have been asked to define the non-industrial undertakings which the Government have in mind to give grants to and which are not included in the Distribution of Industry Act, 1945. That Act was limited to industrial undertakings and to development areas. This new Bill, however, as I think I explained, extends the power to grant loans to non-industrial undertakings, whether inside or outside development areas. I think that those might include banks, insurance companies, hire purchase companies, hotels and office organisations generally. The Bill deliberately does not define what is included. The object is not to debar by definition any undertaking which might contribute to reducing unemployment. That is why, also, as the noble Lord, Lord Conesford, has pointed out, the Bill is not specific in certain other respects. I will look carefully into the technical point that he has raised, because I think that he has put his finger on what might be a difficulty.

The noble Viscount, Lord Hall, asked whether any grants or loans paid under this Bill can be used for building factories, advanced or otherwise. The only power to be taken by this Bill is the power, in suitable cases, to assist by loan or grant persons proposing to carry on an undertaking in a place of serious unemployment. The Government are not taking powers to build factories themselves, for the reasons I gave. Local corporations or limited companies which run industrial estates could bring themselves within the strict terms of the Bill. But the object of the Bill is to reduce unemployment, and it is, therefore, the Government's intention to make loans or grants directly to the organisations which are themselves going to provide the employment, rather than to intermediaries.

The noble Earl, Lord Dundee, drew a searching parallel between a suit from Moss Bros. off the peg and another suit from Savile Row. I think it is just as well that he did that in a speech in your Lordships' House and not in a letter to a Minister. The noble Earl's question, if he will allow me to say so, is not quite appropriate to this Bill, under which the Government are taking powers only to make loans or grants. The Board of Trade's powers under the parent Act to put up factories, of course, continue unaffected by this Bill. As the Secretary of State for Scotland said in another place, there is a great deal of evidence that the 'advance' factory is not the catch that it used to be. The noble Earl, Lord Dundee, also drew our attention to a brush that he had in years gone by with the present Prime Minister, then Member for Stockton, and he asked whether I had discussed this Bill with my right honourable friend. For various technical reasons which we need not go into, I have not had the opportunity of discussing this Bill with the Prime Minister; but, if my noble friend, Lord Dundee, really insists that I should bring the point to his notice, I will do so, at the risk of finding myself not only without Portfolio but also without office.

On Question, Bill read 2a, and committed to a Committee of the Whole House.