SCOTTISH DEVELOPMENT AND INDUSTRY

HL Deb 25 November 1964 vol 261 cc853-926

4.22 p.m.

Debate resumed.

LORD FORBES

My Lords, we now fly back north of the Border. I should like to begin by apologising to your Lordships for not being present at the beginning of this debate. I would also offer my congratulations to the noble Lord, Lord Hughes, on his ministerial appointment, and wish him the best of luck at the Scottish Office.

I think that I first met the noble Lord at the Scottish Office, when we were discussing the question of the Tay Bridge. At that time, the noble Lord was Lord Provost of Dundee. Probably we can both claim that, as we did not disagree on that occasion, that is one of the reasons why the Tay Bridge is being built to-day. Later, I knew the noble Lord as the extremely successful chairman of one of Scotland's New Towns, Glenrothes. I may say that the noble Lord held both of these offices with distinction, aided, no doubt, by the fact that he was working under a Conservative Government. Of one thing I am certain, from my own experience at the Scottish Office; that is, that nowhere is any Minister likely to get more loyal service from the whole staff, whether it be the Permanent Under-Secretary of State, the private secretaries, those who operate the lifts or who drive the official cars, than the noble Lord will find at the Scottish Office.

Before going on 10 the main topic of the debate, I should just like to support what I gather my noble friend Lord Craigton said about the retrograde step the Prime Minister is taking by not appointing a Minister of State who can answer at St. Andrew's House for the Secretary of State. As a former Minister of State, I know perfectly well that an Under-Secretary of state, however astute, if he has departmental responsibilities, cannot possibly lock after his Department and see all the papers that the Secretary of State sees. This means that from now on all decisions, except departmental ones, which are the responsibility of the noble Lord, Lord Hughes, will have to be dealt with from Whitehall. Furthermore, Scotsmen, whether individuals or members of delegations, will have to travel to London to get their answers. I ask the Government: Is this the way to treat the people of Scotland? Do they seriously think that the people of Scotland wish the clock to be put back to the time when practically all the decisions affecting Scotland came from Whitehall?

Scotland is not in any way a sick country: on the contrary, she is a country full of opportunities. However, Scotland has the misfortune of having been almost entirely dependent on heavy industry. This situation is being put right but, of course, it is a slow job. What is it that Scotland needs most? Surely, the answer is, more new jobs. And there is little doubt that most new jobs come from industrial growth. There is no doubt at all that, if we are to get industrial growth, good communication for personnel travel and freight movement are essential. I shall therefore attempt to convince those of your Lordships who are not already convinced of the necessity for good communications, and I shall deal with railways, roads and, especially, the air.

First of all, I take rail transport. It is ridiculous to say that awkward loads must go by rail. The railways, due to such factors as gauge and tunnel size, are less able than the roads to deal with these awkward loads. However, what is wanted is that many more complete loads should go by rail. Much more traffic, in the form of complete loads, would go by rail if it were not for the fact that double handling is often involved. To overcome this objection more loads must be moved by containers. The speed-up of what British Railways call "containerisation" is urgently required on the railways. I made my maiden speech in this House some ten years ago on the subject of "containerisation." I admit that the railways are now moving in the right direction over this matter, but up till recently the wheels have been turning lamentably slowly. It is not just a question of making containers available: the railways have also to make the container rates attractive, if they are to attract more traffic which should be on the railways but is at present cluttering up the roads.

I come to the roads. There is no doubt that the roads provide the conveyor system for industry and in doing so, can provide a means of moving goods without double handling. They also provide door-to-door communications for personnel. To the industrialist it is becoming more and more obvious that the most important requirement of our road system is the development of trunk roads, with a minimum standard of dual-carriageway, rather than classified county roads, many of which are very much better in Scotland than those found South of the Border. Surely the trunk roads are the arteries of any road system while the classified roads are the veins. We all know that it is no use having the veins in excellent conditions, if the arteries are blocked. It seems to me that some of our priorities have not been quite right.

What are some of the urgent specific requirements? First, a dual-carriageway road from Aberdeen, via Dundee and the Tay and Forth Bridges, to England. Of course, the most important part of this project is the link between the Tay and Forth Bridges; and this should also serve Glenrothes, one of our New Towns, which would thrive even better if communications were improved. Then I turn to something for which the noble Lord, Lord Ferrier, has been pressing—a proper by-pass around Edinburgh, instead of a so-called ring route, which is nothing more than a multitudinous collection of signs. It is no use the Government talking about a traffic census. Now that the Forth Bridge is open, the extra traffic through Edinburgh is becoming unbearable. It can be seen any day. There is no need to wait until the mass of statistics is completed and examined before action is taken: the facts are there to be seen.

In the air, if Scotland is to get ahead and so bring about the essential industrial growth, we must assure that air communications and personal travel are further developed. I cannot emphasise too strongly that we cannot live and complete in this space age when a distance barrier still exists in the United Kingdom. The distance barrier between Scotland and the South-East of England or the Midlands cannot be tolerated one day longer. The growth in the South-East of England and the Midlands is still dominant. There, industry thrives; there, new jobs are to be found in abundance. There is the industrial magnet which would draw most of industry, were it not for the necessary action of Governments who have had to use the stick in these areas while holding out a carrot in others. It is in the South-East of England and in the Midlands that industry is really thriving. It is there that the 'sixties competitive industrial "bug", which can be so contagious, is caught, just as much as the plague was in days gone by. Scotland must be given the necessary air facilities to break the distance barrier and enable Scottish industrialists to travel and catch this competitive industrial "bug."

Command Paper 2188, A Programme for the Development of Central Scotland, published in 1963, made, in paragraph 66, this observation about air communications: Good air communications for both domestic and international journeys have become an essential part of any modern expanding economy. Businessmen need to be in the closest touch with their markets and be able quickly to follow up any new opportunities wherever they may be. The availability of an airport within reasonable travelling distance offering both domestic services and either direct international flights or convenient connections thereto is increasingly important in attracting new industrial commercial enterprises. Then, in 1964, there was published another White Paper, Cmnd. 2440, and I should like to quote just a part of paragraph 73: Discussions have taken place with the Scottish Council (Development and Industry) about their Master Plan for improving air services. I must ask the Government what has happened to the Scottish Council's "Master Plan" for improving air services. It has been in existence for a very long time—certainly, quite long enough for the decisions to be made. Somebody must be "soft-pedalling" and not only Members of this House but also the whole of Scotland should know who it is. I would ask the noble Lord, Lord Hughes, the question: Who is "soft-pedalling"?

Personal meetings between directors and executives are essential if new contracts leading to new jobs are to be created. The telephone and letters have their use, but for real progress personal meeting is usually essential. Here do not let us forget the value of the executive's time, and that absence of frustration is essential. This is where the air can play such an important rôle. We must also remember that once goods have been produced they have to be sold; and for this purpose salesmen, too, must be able to move about easily.

Let me now turn to a few specific cases. Before choosing a site industrialists usually look carefully at communications. This applies even more to those who are coming from the other side of the Atlantic. Americans and Canadians know full well the merits of Scottish workers, but this does not override their insistence on good communications. I experienced an example of this when an American firm was on the point of setting up in Dundee, but cried off owing to lack of air communications. Then at Edinburgh a second runway is badly needed, so that aircraft can land in what are at present cross-winds. Flying down two evenings ago I got to Edinburgh, where I was told that the plane coming up from London could not get into Edinburgh. We had to go by bus to Renfrew, and come on that way, which involved a delay of three hours. Edinburgh is Scotland's capital city, and it is ridiculous that a capital city should have only one runway. Of course, we all know that a second runway will cost money, but this is money that will have to be found. In my part of the country, the North-East, we must have a service from Aberdeen, Glasgow and the Midlands. One can get to Edinburgh and to London quite easily, but Glasgow and the Midlands are very difficult to get to.

Then there is the question of executive aircraft. We must not forget the important rôle played by executive aircraft to-day in saving both time and frustration. I am a director of two brewing companies. Our parent company has an executive plane which enables the company to carry on business not only throughout the United Kingdom but also abroad. Unfortunately, the facilities afforded to executive plane operators are far from adequate. Understandably, executive aircraft can only on occasions use London Airport. Other civil airports can be used, but often use has to be made of R.A.F. airfields. Unfortunately, the R.A.F. stop work for the day at 5 o'clock, and sometimes earlier. This early hour beyond which facilities are not available cramps the style of the executive, who usually has great difficulty in planning his business so as to land before 5 p.m. In addition, the V.H.F. frequency at present used by executive aircraft is very overcrowded. Another point is that they should be able to obtain Customs facilities on giving prior warning at master airfields when landing executive aircraft returning from abroad. If executive flying is to be developed, these matters must be put right.

As I have said, Scotland is not ill, but if she is to get sufficient industrial growth, and consequent new jobs, within the foreseeable future she will do well to get a shot in the arm. What better way to do this than by ensuring that Scotland has not just good air communications, or as good as those of other countries, but better than other countries? And in planning the best air communications for businessmen, do not let us forget that the businessman can seldom book ahead. He must be able to travel when he wants to. That means virtually a "walk-on, walk-off" air service.

Most airlines are unwilling to put on a service until there are signs that the existing services are becoming overcrowded. It cannot be too strongly emphasised, however, that the potential cannot be assessed until a new or an increased air service has been tried. This may mean that new services will require some Government help in order to keep them going. In this respect I would emphasise two things: First, that any Government help, if required, should be confined to starting off these new services; and, secondly, Government assistance must be available to any (and I stress "any") suitable air contractor. There is little doubt that any grant or loan the Government might have to give to ensure that Scotland has one of the best air services in the world would be a mere flea-bite compared with, say, the recent losses which have been chalked up by British Railways.

My Lords, Scotland is on the brink of breaking the distance barrier. In 1963, 18 per cent. more people travelled by air in Scotland than in the previous year. Surely, it is up to everyone, not only the Government, to see that as from 1965 the distance barrier becomes a thing of the past. The Government and everyone having Scotland at heart have a great opportunity to recognise that good communications, especially air communications, are essential to produce the economic growth which is necessary before we can get employment growth. This is an important lever which the Government can use to prise open the opportunities that exist throughout Scotland. If the Government do not at once give the green light, the "go-ahead", to Scottish air services and better facilities for executive aircraft, then I warn your Lordships that, like the Ministry of Transport television advertisement which refers to the "boot-bumper" driver, the driver who is always on the tail of the car in front, I shall be a "boot-bumper" driver to the Government. I shall continually drive on their heels. But I sincerely hone that the need for improved air services will be recognised so that this painful action is not necessary.

4.43 p.m.

THE EARL OF DUNDEE

My Lords, this is not a Party Motion, and I should like to make a few short remarks about it, not on behalf of the Opposition, but as an individual Peer of Scotland. First, may I offer my very warm congratulations to the noble Lord, Lord Hughes—who this evening will make his maiden speech from the Front Bench—on his appointment to an office which we all wish had been higher. While I quite agree with my noble friend Lord Craigton that it is not a good thing for Scotland that the Minister who answers for Scotland in your Lordships' House should not be the Minister of State, I do not think anybody could blame Lord Hughes for this negative state of affairs. We know that he is a modest man, but we do not suspect that his modesty might have been carried to such extreme lengths as to insist on being appointed to a lower office than everybody else thinks he ought to have.

Our purpose in discussing this Motion is not to criticise the noble Lord, but to help him in the work which he has been called upon to do. We hope that he may be able to wind up this debate with the words of King Edward in Richard III: Why, so: now have I done a good day's work; You peers, continue this united league". That, of course, was an English league and not a Scottish one. The Scottish league is sometimes more solemn and perhaps more effectual.

As it happens, the office to which the noble Lord has just been appointed is the same office to which I was appointed just over 28 years ago in October, 1936. I do not know whether the noble Lord has the same room as I had. I rather hope he has, because it is by far the loveliest ministerial room in Whitehall. But even if the pressure of modern ministerial overcrowding has pushed the noble Lord into one of the attics of Dover House, we are glad that this debate should he answered by a Minister who, before he came into office, did a lot more to promote the aims of this Motion than any of his innumerable colleagues in the Government that I can think of. Besides being Chairman of the Development Corporation of the New Town at Glenrothes, and besides having been Lord Provost of Dundee for six years, the noble Lord was also Chairman of the Joint Tay Road Bridge Committee, a post which required considerable tact and skill. I would assure your Lordships that many of the people he had to deal with were far more difficult than my noble friend Lord Forbes. I think it is generally agreed that the noble Lord's chairmanship of this Tay Road Bridge Committee did a great deal to accelerate the commencement of that long desired project, which is now more than half way towards completion.

Perhaps some of your Lordships may not be aware that, unlike the Forth Road Bridge, which was opened just over two months ago—it seems much longer than that now, but quite a lot of things have happened since then—the Tay Road Bridge does not receive any Government grant at all. The whole of the £4½ million which is now being spent on its construction is provided by the three local authorities of Dundee, Fife and Angus. Dundee contributes 63 per cent., Fife 27 per cent., and Angus 10 per cent. I have always thought, and I still think, that, when it comes into use, the transport authorities at St. Andrew's House will find that they have underestimated the quantity of long distance traffic which will use this bridge. But however that may be, the bridge is certainly an essential part of what the White Paper calls the infrastructure for the economic growth of Scotland. I hope that the volume of traffic which will use it will be enough to enable the three local authorities who have put up the money to reimburse themselves from the toll charges for their outlay—at least the greater part of their outlay. If they could get the whole of their outlay back, it would be a most gratifying success story, and we should not grudge paying the tolls which will be only a small fraction of the present ferry charges.

There is one other matter concerning East Central Scotland which I must raise, and which I think ought to be raised in this debate. I will not press the noble Lord for a reply, because I know that he has the right ideas on the subject, and I think it is only fair to give him a little more time. There are two recent White Papers dealing with the development and growth in Scotland. First, Cmnd. 2188, Central Scotland, which was published last November and then Cmnd. 2440, Development and Growth in Scotland, 1963–64, published only two months ago in September. In paragraph 19 of the first of these two White Papers a summary is given of measures which are proposed to he taken for the Scottish economy. Under the heading "Airports" are summarised the completion of Abbotsinch airport, the preparation of plans for the development of Turn-house, and the urgent consideration of the needs of Dundee. Again, Dundee has a little paragraph, No. 69, all to itself: Dundee's need for regular air communications to the industrial and commercial centres in the south is, along with airfield requirements for the area, now being urgently considered. That was 12 months ago when it was being "urgently considered".

In the other White Paper, published in September, paragraphs 74 and 75, on pages 16 and 17, describe the progress which has been made in improving the aerodrome and navigational facilities in Scotland. It is mentioned that the amount of money invested in those improvements has gone up from £643,000 in 1962–63 to £1,853,000 in 1963–64. But the only mention of Dundee is: At Dundee the Corporation have lengthened the landing strip at Riverside Park to 4,500 feet and a licence has been granted to Messrs. Duncan Logan Ltd., to operate a passenger service between Dundee and Edinburgh using four and five seater aircraft. That, of course, is a charter service which does not run regularly and, indeed, does not run at all unless someone charters it for a special flight. I do not think that is very abundant fruit for 12 months' "urgent consideration" which we were told was being given to the matter in November 1963. What we want is a regular service. Of course, the licence for a chartered aeroplane is not a regular service, and although they do not mention it, I think I know the cost which the Corporation have lately incurred in lengthening Riverside Park; it was £13,000. That is £13,000 out of a total of very nearly £2 million which has been spent in Scotland. I think we are entitled to ask that the "urgent consideration" should be speeded up a little.

We would certainly like a regular feeder service from Dundee either to Turnhouse or to Renfrew. Better still, would be a through-service to London such as they have from Aberdeen. I am fully aware, and I am sure the noble Lord, Lord Hughes, is, too, of the various difficulties. At the present moment, for reasons we need not go into, the use of Leuchars military aerodrome seems to be not practicable; and as for the Dundee airstrip, B.E.A. have always claimed that a feeder service would cost them an annual loss of something like £40,000. I do not know that they have ever given a sufficient allowance for what they would get back by the extra passengers they would gain for their long-distance flights to London.

I have said that I am not going to press the noble Lord for an answer to this to-night, but there seem to be two things which could be done. One would be to allow free competition the whole way to London from private airlines. I do not think you can expect a private airline to undertake the unprofitable haul of the short feeder service from Dundee to Renfrew unless it were allowed to go on and take passengers to London. Either you should have free competition or the Government should instruct B.E.A. to run the feeder service and should then consult with them as to the amount of money which they could reasonably be expected to lose in one year. They say they will not do it without a subsidy. Very well, let us see how much it would cost. I think that is a matter which should be urgently considered, as the White Paper said was being done.

The primary reason why we want it done is not for anybody's private convenience but for the reason which I do not think could be stated better than it is in the White Paper itself (paragraph 66), which says: Good air communications for both domestic and international journeys have become an essential part of any modern expanding economy. Business men need to be in the closest touch with their market and to be able quickly to follow up any new opportunities, wherever they may be. The availability of an airport within reasonable travelling distance. offering both domestic services and either direct international flights or convenient connections thereto, is increasingly important in attracting new industrial and commercial enterprises. That, my Lords, is the main point, its importance, "in attracting new industrial and commercial enterprises".

It is very true that good air services are becoming an increasingly important necessity for all the development areas. Dundee is rather on the periphery of the central industrial belt. It is, of course, a "development area." It is not what is termed a "growth area", and I am not going to discuss whether or not it ought to be a growth area. What I am concerned about is, that in the Government's regional planning and in their economic planning Dundee should not be left out. It is certainly in the national interest that it should not be left out, because, except for Glasgow, Dundee has a higher industrial production than any other city in Scotland, and a great many of its products are particularly important to our export trade. Therefore, it is in the national interest that those who plan the infrastructure of our economic growth should see that there are good communications by air, by rail and by road, and, also, my Lords, by sea, because Dundee has the best port in Eastern Scotland with deep water wharves which can take larger ships than any other port in East Scotland.

I would ask the Government to make representations to the National Ports Council about the future of Dundee Harbour. It would be a great pity if it were to be let down in any way, if the plan for port facilities for East Scotland did not enable Dundee to play its full part in any scheme which the National Ports Council may produce. It would not be right, and would not be in the public interest, if other ports were to be modernised by Government subsidies so that they could greatly reduce their port charges and the Port of Dundee could no longer make its charges competitive.

As it is with the infrastructure of the economy, so it is also with industrial planning. It is in the national interest that the modernisation of the jute industry—which is bound to employ less people as it becomes more specialised, like other textile industries—should be balanced by a greater diversity of factories.

LORD ROBERTSON OF OAKRIDGE

My Lords, I wonder if the noble Lord would allow me to interrupt and to hark back to a moment or two ago when he was talking about the air service and, in particular, to the desirability of the Government making a subvention to B.E.A. if necessary in order to run a feeder service? Could he say why, if this service is so important to industry, industry is not prepared to pay for it? Alternatively, if B.E.A. are to be given a subvention to run it, would the noble Lord also suggest that British Railways should be given a subvention to help them in their competition with B.E.A. on this service?

THE EARL OF DUNDEE

British Railways, as I understand it, are already costing us £150 million a year, which I would call a pretty hefty subvention. The Government do, of course, give a subsidy to B.E.A. for certain purposes, and whether local interests would be able to do what they have done in the case of the Tay Bridge I do not know. But I should have thought the Government ought to look into the matter with B.E.A. and try to work out how much they would need to run this feeder service, at least as a first step.

I now come on to the need for a better balance of industry in Dundee, the need for modernisation of the jute industry to be balanced by greater diversity of new factories. It is necessary that the very excellent new industries, both from Britain and from America, which have come to Dundee in the last seventeen years should be extended a good deal more. Dundee wit never be and does not want to be a conurbation, but we do need a considerable extension of the new industries which have come there already. I think the latest local redevelopment plan, which the noble Lord may perhaps have seen, does no: appear to contain nearly enough room for new factories. I would suggest to the noble Lord that the new factories should include one or two of the standard new Board of Trade factories which are to be provided ready for occupation to various development areas. I think it would be a good thing for the country if we were to speed up the extension of new industries in Dundee, which has not got quite so many new factories as other areas in the last few years.

I hope that the Scottish development group and all the departments associated with it will give particular attention to these three points: tie need for an air service; the need for the Port of Dundee to be properly developed, together with other ports; and the need for an acceleration of new building on or near the industrial estate. I hope that the Government and the noble Lord will see that consideration is given to these points. One reason why I am glad the noble Lord, Lord Hughes, is there. even although he is not a Minister of State, is that I think he is the type of Minister who has what one might call a dominant mind which will not be easily disposed to allow proposals which he knows to be good proposals, and in the national interest, to be checked and frustrated by what Sir Winston Churchill described as the padded cells of indubitable fact and the solid masonry of unanswerable objection. My Lords, I think that a stranger who travelled through Scotland five years ago and who travelled through Scotland again this year would notice a id would be more impressed perhaps by the changes that have taken place in the country than we are, because we who live in Scotland have been so accustomed, during those intervals when we can escape from the concentration camp at Westminster, to feel that we are fighting a long uphill battle against overwhelmingly superior odds. When I held the noble Lord's office 28 years ago one of my duties was to move the Second Reading in another place of the Special Areas Act, 1937. That was just after the Hillington Industrial Estate had been established and at the same time as the Scottish Special Housing Association was formed, and we had great hopes then of new industrial and housing programmes. Those were checked by the war.

Since the war, although we have had very great industrial progress indeed, it has nearly always been equalled, and sometimes exceeded, by loss, not only loss of employment but loss of production in old industries, and many people have developed a kind of failure complex thinking things can never improve. The Local Employment Act, 1960, which I think was a very good Act, had a bad reception in Scotland. It may be that it was not as well presented as it should have been, but it was not received with enthusiasm, although it was associated with the two great new ventures, of B.M.C., at Bathgate, and Rootes Group, at Linwood, and many other new developments.

The measures in the Budget of 1963, on the other hand, giving unprecedented advantages to new industries, did have a better reception by the Press and public, and since then the number of inquiries for new industries has certainly been very much greater. A week or two ago when I was in Edinburgh I went to Her Majesty's Stationery Office and got a copy of a deadly dull looking document called Digest of Scottish Statistic's, October, 1964, which is an official Government publication. From this horribly dull book I derived the cheerful information that in one year, from June, 1963, to June, 1964, industrial production in Scotland had gone up from 117 points to 127 points (1958 being the base year). That is an increase of more than 7½ per cent. We have still a very long way to go, but I think we have achieved a major breakthrough in the enemy's defences, and if only we can all co-operate now in exploiting our breakthrough and taking advantage of our position, and continuing the momentum of our advance, although we may have a long way to go it need not be a very long time before Central Scotland has become as progressive and as flourishing an industrial area as any other in Europe.

5.8 p.m.

BARONESS HORSBRUGH

My Lords, I do not intend to detain your Lordships for very long, but there are just one or two considerations I should like to put before you. When I spoke in the debate on this White Paper last December, I and many other noble Lords asked the Minister of State who was then in charge, my noble friend Lord Craigton, whether we could have progress reports. Here were outlined for us suggestions for Scotland and for the central area of Scotland, and I was anxious that we should see what progress was made. He replied that we should get the Annual Report of the Scottish Development Department, which we now have, published, I think, last September. I would thank him for that and for all the figures in it. In fact, I think it would have been hardly necessary for my noble friend Lord Dundee to get the very dull publication in Edinburgh because of the mass of information contained in this Report. We have the information; it is definite, and I thank the noble Lord for having given it to us. I also congratulate him and all those who have been working with him, on what has been done in the preparation of these two Reports.

I feel that we have now made a very good start. The difficult decision having been taken to pick out one particular region in which to put most of our efforts to begin with—and I said I thought they were right to select and concentrate first of all—I quite see now that we must go further afield. There are the difficulties of the Highlands, the Borders and various other places. But I would appeal to the present Government that when they, as we all know we must now, look for further improvements away from the central area, they will not in any way give up their interest in, their pressure for and the help to, this central part of Scotland, which, after all, has three-quarters of our population and 90 per cent. of our industry.

I hope that in leaving office my noble friend Lord Craigton realises what a good job he has done, and how much that is recognised throughout Scotland. I hope, too, that the new Ministers may follow in his footsteps. My noble friend said last time in his winding-up that there was a new hope in Scotland, that there seemed now to be some optimism. I know that we went through a stage of being rather miserable, rather depressed, perhaps giving to the world outside an idea that we were a depressed area and a depressed people. But really we were not. Nothing is so enervating to the morale and outlook of an individual, or of a community or nation, as when we become sorry for ourselves or feel that we have not had a fair deal. I think that Scotland suffered a little from that. I am glad to think that we have now got through that stage; that we now have a different outlook, that there is more hope, more energy. I think that that new outlook has been symbolised and helped this year by the opening of the Forth Road Bridge, which seemed to many of us a symbol of what we could do, and how we were travelling into the new, modern world with our energy and our technical skill, following upon the efforts that we have made in the past and can make in the future.

In the debate we had last December certain suggestions were made by various noble Lords. At that time, of course, the noble Lord, Lord Hughes, was not quite certain that he would be in the place where he is to-day, but he told us that practically certainly he would be; and I must give it to him—he was right, though I do not think there was perhaps quite that clarion call to the Labour Party from the electors that he felt was coming. But at that time he put forward an Amendment to the effect that the proposals in the White Paper failed to ensure an immediate, substantial reduction in unemployment.

I was in another place for a good many years and I have been here for but a short time, but I know quite well that when you are drafting an Amendment the language used should be rather elastic. What exactly is the meaning of "substantial"? Perhaps Lord Hughes will tell us, when he replies, whether he thinks the reduction in unemployment in Scotland in this last year has or has not been substantial. I should like to congratulate him on his appointment as a Minister. I am not entering into the controversy whether it would be better for Lord Hughes, or for us in this House, if he were a Minister of State. There are plenty of Ministers of State in other Departments, and the Government could quite easily cut down on one and hand it on to Scotland. Whether the noble Lord, Lord Hughes, would like it or not, I do not know. I am sorry he has not got it, but it does not seem to me to make so much difference.

Having said that he thought that he, or at any rate his Party, would be in authority by this time, he put forward two concrete suggestions which he urged the then Minister, my noble friend Lord Craigton, to deal with. I should like to ask Lord Hughes whether he has already dealt with those, because they were quite clear and he had made up his mind. His noble Leader here could have heard him, and I am quite sure that others will have read his speech in Hansard. There were two particular points he made. The first was in regard to the 10s. per ton surcharge on coal in Scotland. He told us what a difference it made in Glenrothes, and that my noble friend Lord Craigton should be pressing his colleagues to gent that matter dealt with. I should now like to ask the noble Lord, Lord Hughey, whether he has already pressed his colleagues to deal with it. He has had a year to tell them all about it, because he knew then, so he told us, that his Party was going to be in power.

The second point is one in which I am particularly interested—namely, that one or more Government Departments could move some or all of their activities to Scotland. I see that the noble Lord agrees, so perhaps that is coming about. I ask particularly for this, because there have been rumours in the last two weeks that perhaps the present Government were going to change the plans for taking the Post Office Savings Bank to Glasgow. Informed people have said that that could not be possible because, from a leaflet published by the Labour Party last year, not only was the Post Office to be concerned but so were one or more other Government Departments. I hope that the noble Lord, Lord Hughes, can tell us about that.

Then, during my speech, he made an intervention, to which, naturally, I was quite pleased to sit down and listen. It was to the effect that the White Paper contained merely words and no action. Of course, White Papers generally contain words. But he did say that they were good words, that the language was very good indeed, and he admired it. He said that there was too much generalisation and that he wanted specific proposals. As I say, during my speech he intervened. I asked if we could have from him, or from any of his colleagues on those Benches, specific proposals.

This was last December. But of course that was a little too early, and we had to wait a year by which time, they prophesied quite rightly, they would be sitting where they are. But they said they had specific proposals to cure the ills of Scotland. I should be most interested to hear to-night from the noble Lord what the specific proposals are. I shall not be altogether surprised if the noble Lord says that I must not press him for that information, because, after all, the Government have been in office for only four or live weeks. They have done such a lot of mischief that I thought it was much longer

LORD CRAIGTON

Forty days and nights.

BARONESS HORSBRUGH

Not yet the hundred days, anyway. I should not be surprised to hear that they have not specific proposals. Although in last year's debate I was told about specific proposals to cure the ills of the Scottish economy, I did not believe they had them. I cannot press the noble Lord to-night and ask him to produce them now, when I did not think they had them then. If they had, if the specific proposals they were talking about last year had already been really thought out, of course we could have them this evening; but I doubt if they did.

In conclusion, there is one other subject to which I should like to refer—namely, the training and education of young workers who are coming into industry. I was glad to hear of the extra schools and colleges of technical education and commerce, of the training centres, and all the rest of it, because it is absolutely necessary that we have more skilled workers. That is always the difficulty. There may be unemployment, but there may not be enough skilled workers in order that one can take on less skilled workers. We need now not to get a greater short-term policy for Scotland, but a longer-term policy, to look to the future when these young people who are coming in now are going to be the mainstay of the workers in the industries of Scotland, and with more to follow them.

In these schools, training centres and colleges we hope to teach them their skills in the modern outlook and all that is otherwise required. But there is something further that we can teach them for which we are not crying out now. That is a greater sense of responsibility, a greater sense of the worth that they can bring to their country and to industry if they go about their work with keenness and enthusiasm.

One of the difficulties concerning our debates in Parliament and comment in the Press is that we are bound to spend our time pushing the Government which is in power to help us more—to give us more grants for Scotland, to provide us with more opportunities for doing this or that. I believe that some young people are growing up with the idea—and perhaps we are to blame and not they—that it is the Government which will decide whether or not Scotland is going to be prosperous. We all know that that is not the case. It is the co-operation between the Government and all the people in industry in Scotland, whether in management or on the shop floor, working together, which will decide. We shall have to tell these young people as they grow up and learn their skills that an industry cannot simply sit back and say, "The Government will arrange this or that", and no effort will need to be made by the individual. The answer lies with the people of Scotland as a whole.

In conclusion, I can assure the noble Lord, Lord Hughes, that we on this side of the House will support and help all the proposals which the new Government can put forward for the welfare of Scotland. If we think they are not for the welfare of Scotland, then we shall oppose them; and, as the noble Lord knows, I am not shy at opposing.

5.22 p.m.

THE EARL OF SELKIRK

My Lords, I should like to wish the noble Lord, Lord Hughes, every good fortune in the task which he has undertaken. I confess that I must endorse the regrets which have already been expressed that he was not made a Minister of State. I think this is a matter of importance, and I find it hard to believe that when the appointment was made there really existed an understanding of its significance to the Scottish Office. When the Labour Government were last in power we in Scotland were rather frightened at what the significance of centralised planning might be. At one stage it almost reached the point of running the Glasgow trams from London. That is all past, and I do not for one moment think that mistakes of that kind are going to be made again. But it is important for the noble Lord to appreciate how much we need to realise that our problems are understood.

When Scotland comes up for debate in this House it very often tends to be discussed on a purely constituency basis. This is rather a pity, and one can hear Englishmen going through the corridors saying, "Why not give them Home Rule, and they can deal with their own problems themselves?". But this is part of a very important national problem. It is an essential and integral part of what twenty-five years ago Montague Barlow called a social, economic and a strategic problem which requires immediate attention. This stretches beyond Scotland, and I make no bones about it. It applies to the North-East and to other parts of the country. It is important that the question should not be regarded simply from a constituency angle. When I was Commissioner of Special Areas of Scotland some twenty-five years ago the problem then was one of unemployment. But to-day, although that problem is with us, if we regard it simply as an unemployment problem we shall not solve it. It is a bigger, wider problem, and cannot be measured purely in terms of unemployment.

There is one other point which has constantly recurred in recent years, and I have no reason to believe that it will not recur in the future. When we get, as we probably now have in London, and as we probably have in the Midlands, over-employment, any action to relieve it, with the inevitable inflation that goes with it, intensifies industrial, economic and employment problems in Scotland, the North-East and elsewhere. This problem will continue until there is a better balance between the two areas in the country.

To give another example of this, in most conurbations there is probably what might be described as an optimum size, at our present stage of technological advance. If we go beyond that it becomes increasingly expensive to provide the public services in transport, in education, in health and so on. I do not think there is any doubt that London has already passed that stage. Any increase here will be at very great cost to the community, and any reduction will probably be a saving to the community. If I may say this to the noble Lord, Lord Greenhill, when he spoke about Glasgow he did not mention that one of the greatest things which Glasgow has done is to decide not to expand its population. This is an important decision, which very few municipalities in the world have ever taken. I should like to see a similar decision taken in London. It has not yet been taken, and it is about time London took it.

There is another problem involved. People who belong to the free trade school say, "What does it matter? You can have migration from one place to another, so why bother about it?" But migration is not the answer. The reason is that the most vigorous and adaptable people are those who migrate, and one is then inevitably left with a declining community containing the less vigorous members of the population.

LORD GREENHILL

My Lords, I am sorry to interrupt the noble Earl, but I should like to say this. Some of us perhaps feel that there can be such a thing as over-population. What I should like the noble Earl to explain is what possible remedy would he suggest to overcome that problem? He knows Glasgow, and knows perfectly well that there is no line of demarcation, for example, between Glasgow and Paisley; one does not know where the population begins or ends. To take as another example an area like Knightswood, with a population as large as the population of Perth, put into an area which is far too big according to modern standards for that number of people, what is the noble Earl going to do? Is he going to pull down the houses and send away the people? We can complain about these things with justification, but what is your remedy?

THE EARL OF SELKIRK

My Lords, frankly, I am not clear what the noble Lord is asking me. All I was saying was that Glasgow had taken the right decision, and an important decision. It is not extending itself, but is deliberately trying to reduce its population. I was saying that that is a very wise thing to do. I am not quite clear what the noble Lord is asking me to answer.

LORD GREENHILL

I am sorry if my question was not clear to the noble Earl. What Glasgow is doing at the moment, so far as I understand, is two things. One is to have an overspill, at some cost to itself, and at the same time attract four, five or six thousand, as in the case of the Post Office Savings Bank population, to come into Glasgow. Which is the right course? That is what I am asking him. What is he complaining of, overspill, or underspill?

THE EARL OF SELKIRK

So far as I know the position in Glasgow (and the noble Lord who was on the Glasgow Council for many years is more familiar with the position than I am), I should describe the entrance of the Post Office Savings Bank as a form of metabolism—a change in development in the structure of Glasgow, and a thoroughly healthy one. But I understand that the overall population is in fact diminishing. I think that is the right, inevitable and proper decision. It is a wise decision which few municipalities have taken, and which Glasgow is perfectly right to take. I am emphasing that, if we are going to live healthily in these islands, we must spread the economic effort over a wider basis. To-day it is too concentrated and we must try to rectify that.

My Lords, we have used, not without effect, a good deal of the carrot and the stick, but success here must be on a voluntary basis. You cannot succeed beyond a certain point by compelling people to go anywhere. It is no good putting a man in some place and locking the door and saying, "You have got to produce so much there before you can come out." There may be encouragement, but there must be a great deal of willing co-operation. Frankly, all the efforts so made have not yet reduced the tremendous lure and attraction of coming to the South-East. All that has been done in money and in refusing development certificates has not yet overcome this problem.

I must say this. I wonder just why it is that, with all the advantages of transport and communications, we still have people coming more and more into the centres—this is of course happening in Glasgow itself—and not staying outside, where communications are very much better than they were, say, fifty, let alone a hundred, years ago. If we take Scotland as an example, it is difficult to know just why it is that this does not present the attraction it might otherwise do. As has been shown in the Toothill Report, the levels of salaries and wages are just about the same as they are anywhere else. I should have thought that, compared with living in London, where the traffic chaos is probably much the same for all who live here, there must be considerable advantages in many people's minds in going outside. Indeed, if we take Scotland as an example of theatre and golf, I dare say that although the theatres are better in London, the golf is probably better in Scotland. The amenities are there. What is it that has made people reluctant to take it up?

I understand—and it may be worth going into—that less trouble has been found in this respect with American firms than with British firms. American firms have gone readily and been quite happy to develop. I am bound to say that I have reached the conclusion—and I should be glad to have it rebutted—that the reasons why people come into the South-East and do not go into the Northern part of the country are neither rational nor economic: the reasons cannot be explained on rational grounds or on economic grounds. On the other hand, in the national interest, whatever those reasons are, they must be countered.

I am only going to suggest that we should aim at the creation of a greater dynamic life, certainly in Scotland and maybe in other places in the North-East. One way this can be done is by a closer association of industry and the universities. I believe we could do more than we are doing in that sphere. A great deal more of that is done in America than is done in this country, and I believe we could make a much more definite effort to do that. What is required there is more in the way of design teams, design centres. The danger so often has been that a firm has sent to Scotland a branch production agent which is the easiest to be dispensed with. When a closure is to take place that is the first branch to close down; and what is wanted, therefore, is design teams where ideas can be developed.

Finally, perhaps the noble Lord can do something to try to counteract what certainly is a prejudice of Government Departments against going a long way from where they are situated. There is, I am sure, a certain favouritism towards firms which are more nearly placed to Government Departments. In America the expression "centres of excellence" is used. There are two or three of them where very high-grade work can be done. I believe it should be our major aim, in considering this as a national task, to make the central area of Scotland a centre of excellence.

5.34 p.m.

LORD DRUMALBYN

My Lords, I should like to start, as almost every other noble Lord has done, by congratulating the noble Lord, Lord Hughes, on his appointment. I personally had expected that it would be higher, and I own that I was disappointed that it was not. But at any rate I can say this: for a long time I had the pleasure, if I may put it that way, of being at the receiving end of his representations; and now the positions are reversed. That, at any rate, is a piece of justice.

May I say this to the noble Lord, Lord Greenhill? I thought that his speech showed how very difficult it is to say anything which may not be interpreted as criticism. He seemed to think that the sole function of the Opposition is to complain. Of course that is not so, least of all in a debate like this, though, obviously, we have to bring out the points that are wrong. But I did not detect anything in the speech of my noble friend Lord Craigton which was in the nature of criticism of Glasgow. What I think my noble friend did say was that the whole system of inducements to firms to move out of Glasgow, and to firms to move into Glasgow, ought to be looked into. And, with all respect, with that view I agree. I would only add that I think we should also look into the question of who is to pay the cost of the inducements.

It is of course possible to take measures that will immediately reduce unemployment, although I doubt whether it would be possible to take measures which would immediately reduce unemployment in Scotland to the general level of that in the United Kingdom. In other words, what we are faced with in consideration of the industrial problems of Scotland is essentially a long-term problem. I suppose one could put it in this way: that the aim should be to arrest the "brain-drain" and get steady growth in Scotland at least as great as that in any part of the Kingdom. That is what we should like to see. We are very much in a period of formation and transformation—transformation from the excessive reliance on the heavy industries to a much greater diversification of economic activity; the formation of the new generation needed to complete that transformation and to be ready for the next one, because we shall always be going from one transformation to another; a generation better qualified to adapt itself.

My Lords, of the quality of our manpower there can be no doubt. The fact that since the war over 50 companies from North America have set up in Scotland, accounting for over 70 per cent. of total manufacturing employment and 20 per cent. of our ex ports from Scotland, speaks for itself. We are grateful to our trans-Atlantic friends and we are grateful, also, to the Scottish Council for the work they have done in helping to attract American industry here and in "selling" Scotland in America. We are also grateful to the Board of Trade for the assistance they have given, which is perhaps sometimes rather overlooked in Scotland.

I think that in these United States and North American firms which come over there is one feature which is particularly desirable. This is that very often the American firms allow competition in exports with the parent industry in America. The result is that there is a constant comparison and emulation between the costs of the Scottish firm in this country and the costs of the parent company. This works right down the line. There is a feeling of emulation which is a tremendous spur to greater efficiency and to a feeling of teamwork. That is extremely desirable. Other countries have found that there is the same value in bringing work to Scotland. I believe that Germany is one of the countries involved.

Perhaps with English firms the argument does not apply to the same extent. One tends to find that when an English firm set up in Scotland they set up a specialised industry, or a part of their activities which is integrated into the whole of their activities in quite a different way: as often as not, it is not a duplication.

The result of this, whether it is a duplication or whether it is a part, is that there is, of course, always the danger of their withdrawing from Scotland in the event of recession; and when they rationalise they take the activity back into England, possibly to the main factory or elsewhere.

But perhaps what is worse than that, in many ways, is that there is a tendency for research, and, indeed, for the marketing and selling organisations, to be centralised at the headquarters in England. I think that one of the main objectives must be to get more industries based on Scotland—at least, more research carried out in Scotland—and I was very glad to see, just at the week-end, that a firm had decided to transfer its main headquarters to Scotland and to have the headquarters of its selling organisation in Scotland. That is the sort of thing I think we ought to encourage.

Now, how are we going to encourage, in particular, the bringing of research activities to Scotland? It is difficult to make suggestions which are of any great validity, but I should be grateful if the noble Lord would look into these suggestions that I am about to make. In the first place, I am sure that, as my noble friend Lord Selkirk, I think, said, we must try to get located in Scotland more Government research establishments of the type of the National Engineering Laboratory, which has done so well. I agree that scientists just do not know what they are missing in congregating in the South rather than coming to Scotland, where the possibilities of leisure and healthy activity are so very much greater. There is much more time available for people who live in Scotland; so much time is wasted in the South.

Secondly, could the Government look very carefully into the possibility of bringing some great international organisation to Scotland? This has been talked about, and I think it is something that would be of immense value to Scotland, because I think trade does follow the flag of UNO to a certain extent. I think it would be a great advantage to get one of the big international organisations in Scotland. Thirdly, can the Government give more research contracts to firms in Scotland? I think this goes particularly for the defence organisations. Time and time again one found at the Board of Trade that there were objections to removing defence activities to Scotland. In the Board of Trade my own experience was that one was constantly doing one's best to prevent firms from expanding where they were in England if they could possibly go elsewhere. But, personally, I had the feeling that it might well be that, while private industry was being prevented from expanding in England, where private industry had defence activities then it was made easier for it to expand in England rather than to move to other parts of the country.

Then, could the Government investigate further tax concessions on research establishments set up in development districts by private industry? I wonder whether the Government also could watch the effect of take-over bids and mergers between Scottish and English firms. So often they result in activities such as research activities being concentrated in the South. I do not say it is necessary that there should be a judgment whether the merger should or should not take place. What one wants to be certain of is that the Government have cognisance of mergers that are about to take place, and that they can influence the conditions in which they may take place. I should be very glad indeed if, where mergers of this kind were going to take place, it was made quite plain that distribution-of-industry considerations must be taken into account, and not least the provision of research in Scotland. Again—this is a small point, but it happens to be completely topical and current, and I wonder whether the noble Lord would answer it—if the Government set up something like the Council on Technology which was announced in the papers this morning, I believe, why is there not a Scottish industrialist on it? I see there are six industrialists there, but there seems to be no Scot.

My seventh point is that one must keep on improving air communications. I listened with great attention to my noble friend Lord Dundee, and there cannot be any doubt, quite apart from what the inhabitants of Dundee think about this—and, goodness knows, they think strongly enough about it; I am well aware of that from my own experience—but that the prospects of Dundee would be enormously improved by an airport: not just an airstrip for feeder services and execu- tive aircraft, but an airport. But, if we are going to have only feeder services and executive aircraft, then let them be organised so efficiently that they will be of real assistance to Dundee; so that there will be adequate capacity available for urgent trips and you will not have to book your trip weeks in advance in order to be able to get down to Edinburgh.

I am bound to comment, I think, on the curiosity (not to put it in any other way) of making virtually all air transport to the Continent pass through an overcrowded London. I do not know how many services there now are direct from Scotland to the Continent, but up to quite a short time ago I think there was only one to Paris, which went through Birmingham. I think one has to base this kind of calculation, again, on the longterm. Of course you will not manage to make it pay in the first year or so, but you have to provide adequate services from the start. If you do not have adequate services from the start, people will not use them; and if accommodation on them is not available, people will not use them.

LORD SNOW

My Lords, may I interrupt the noble Lord for one moment? My memory was slipping a little when he talked about the Council of Technology. In fact, one member, Wilfred Brown, is a good Scot. He is the chairman of Glacier Metal, Limited.

LORD DRUMALBYN

I am very much obliged to the noble Lord. I suspected this, but I wanted to find out. The truth is that Mr. Wilfred Brown is not in "Who's Who"—not vet.

My noble friend Lord Selkirk referred to the need for a closer link between industry and the universities. This is something which is growing very rapidly in Scotland. It is very interesting to see the way universities are carrying out researches, both for private enterprise and for the Government, and I think this is something which is very much along the right lines. At present it is undoubtedly true that people in Scotland are better off than ever before; but is this in part a reflection of conditions in Great Britain as a whole, or is it something which growth in Scotland is itself generating? For what we want to see is growth generated in Scotland itself. It is true that 80 per cent. of the industrial expansion in Scotland has taken place in firms already in Scotland, but that has not Been enough to compensate for the inevitable decline in employment in miring, in the railways, in manufactures for the railways and in agriculture, and for perhaps the less inevitable decline in shipbuilding.

My Lords, what a splendid thing it would be if the real break-through in the abandonment o restrictive practices and demarcation absurdities in shipbuilding were to come in the Clydeside!—that part of the country which, let us face it, is always a little suspect from the labour point of view. If only the Clydeside would make this breakthrough here and lead the way in it, what a tremendous advantage it would give to Scotland a; a whole! Other countries have succeeded in bringing all shipbuilding workers into one union, and I do not see why Scotland should not do that, too. It is estimated that productivity in shipbuilding would increase up to about 40 per cent. if it were done. I do not underestimate the difficulties, and I certainly do not want to try to make them any more difficult, but how marvellous it would be if they could be overcome in the Clydeside—and now, the moment when the shipbuilding credits effect is still being felt, seems to be just the moment to do it.

Do not let us underestimate the progress that has be en made—progress in the laying of the foundations of modernised industry for the future in Scotland. Despite the declining industries, as my noble friend Lord Dundee said, industrial production in the second quarter of 1964 stood at 27 per cent. above the 1958 level. Over the past four years the output per head has risen faster in Scotland than in the rest of the kingdom. I need not go into details, as I think they are well known. The engineering and electrical industries show a 13 per cent. increase over 1958, with a particularly high proportionate increase in the manufacturing of radio and other electronic apparatus. The output of the electronics industry has been increasing by about 15 per cent. a year, and is now worth over £20 million. There is more in prospect with the new factory at Newhouse for magnetic tape computers, and there is every prospect that this will continue to grow.

I should like an assurance from the Government (and I am sure that the noble Lord who is to reply will be dealing with this) that the planned level of expenditure in Central Scotland will not be reduced. We all recognise that the conception of the growth programme in Central Scotland is that we shall have an area of planned development from which prosperity will radiate outwards. There have been misgivings that the success which we confidently anticipate in this area will draw population away from other areas, and actually cause de-population and decline elsewhere, unless appropriate counter measures are taken to stimulate growth there, too. These misgivings are felt most strongly in areas where there is no large town capable of acting as a focus in itself. Dundee and Aberdeen can hold their own, at least so long as they are development districts, so long as they enjoy the benefits of the inducements in the Local Employment Act. But the Borders and the South-West have no such focus—I am not going to talk about the Highlands—and no such benefits either. In the Borders there is a shortage of manpower, because emigration is high; and emigration is high because there is insufficient diversification of industry and not sufficient choice of occupation.

Of course, much is needed, but may I mention what ought, I think, to be one cardinal step? That is the creation of a central focus: if not an industrial complex in itself, at least one which, together with the other Border burghs can form one. I believe that one of the Border burghs ought to be expanded, with Government assistance, and be enabled to attract modern engineering and electrical and chemical industries both to itself and to the other burghs.

The South-West is a special case for, apart from the coastal link with Stranraer to the North, it is virtually cut off from the rest of Scotland by the surrounding hills and sparsely populated areas; and it is cut off from West Cumberland by the Solway Firth. There is a main arterial link that passes through it and goes to Carlisle; and Carlisle, of course, exercises a great pull. Many people go from Dumfries to work in Carlisle, and also go there to shop and for entertainment. There is nothing much that can be done about the hill barrier, which is good sheep country and yields more and more in the way of timber. But there is something that can be done about the Solway to broaden the base of the economies of both South-West Scotland and West Cumberland. There is no communication between Dumfries and West Cumberland except through Carlisle. From Dumfries to Silloth direct, as the goose flies, one might say is 17 miles. The distance by road is 56 miles; and it takes a long time to get there through Carlisle.

Dumfries, I am sure, is the natural centre of the South-West—I do not think anybody would dispute that. I believe that Dumfries should be greatly expanded to become a focus for the South-West and, if necessary, with the surrounding burghs, an industrial complex. I believe also that if communications between the two sides of the Solway were improved it would be of great advantage both to South-West Scotland and to Cumberland—and indeed to Britain as a whole. Carlisle is becoming one of the worst bottlenecks in Britain. The main road arteries, as well as the main rail arteries, pass through Carlisle. I do not believe that communication between England and Scotland will ever be satisfactory until Carlisle is effectively by-passed. The line of the route could be to the West, across the Solway between Bowness and Annan, where the old railway viaduct, one and half miles long, ran. It was closed, I believe, in 1921, and demolished 30 years later.

Such a road would be of great value even if it brought no other benefits; but if it were carried along the top of a barrage containing fresh water fed by the rivers Eden, Esk and the Sark, a double benefit would accrue. The supply of water has been estimated by Dr. Drew, who put forward this joint scheme, as 2,000 million to 3,000 million a day for drinking; possibly for piping to Manchester and the like; possibly for cooling generating plant; and thereafter using the heated water for heating houses and factories, horticultural installations and even for raising soil temperatures. This is a wonderful project. What I should like from the noble Lord is an assurance that it is being seriously considered. There would be other benefits as well—for example, the recovery of land around the Solway.

I do not want to detain your Lordships much longer. I should like to make one point about the employment for women in the mining areas. The last figures I saw showed unemployment among women as 9.5 per cent. in Cumnock, 11.1 per cent. in Shorts and 24.5 per cent. in the Sanquhar development district. In the Sanquhar employment district there is hardly any industrial employment for women. Many must go 30 miles to Dumfries. It is disappointing that the new list of advance factories contains none for Sanquhar or Kirkconnel. One has already been built at Sanquhar and already let. It was always easier to let the second and third; and I hope that a second and third will soon be allocated. The one allocated to Cumnock, is about 17 miles from Sanquhar and is unlikely to help because it is needed for the Cumnock district itself. So I hope, as I say, that the Government will look at the question of employment for women in mining areas.

My Lords, I come to my last point. I said that this was a long-term problem. The best step of all in the long term is to give our children a sound grounding which will enable them to make a progressive contribution to Scotland's life in a changing world. It is good to see that almost our biggest growth industry is education. The numbers employed since 1958 have grown by proportionately more than in almost any other major activity except the motor vehicle manufacturing industry. I was glad to see that the Minister of Labour announced a new step yesterday to co-ordinate industrial education and training. But this was on a United Kingdom level. I am not at all certain that co-ordination should not take place in Scotland for Scotland; and elsewhere regionally, rather than nationally. I hope that the noble Lord will look into this point, with his colleague, the Under-Secretary of State responsible for Education.

I hope that he will also look at something that I looked at when I was at the Scottish Office, and that is the French system of apprenticeship centres, introduced after the war, where the first year is, I believe, roughly equivalent to our own year of pre-apprenticeship courses, and the next two years give particular technical education which enables somebody who gets a certificate to go into industry and six months later virtually to get a journeyman's ticket. I think that this would give the kind of broad basis of education which would be of tremendous value to our young people for the future.

I believe also that much greater vocational guidance is required at an early age than is given at the present time. I am sure that once a young person sees the way he is going, then he begins to get interested in what he is taught. As soon as it is possible to relate what a child is taught to the way in which he is going to earn his living, he becomes really vitally interested, because he knows it is of use to him. I firmly believe that in the education of our people, both in the education of our children and in many cases in the re-education of those who have to move from one job to another, lies one of the keys of the future prosperity of Scotland.

LORD GREENHILL

My Lords, I wonder whether the noble Viscount, Lord Stonehaven, would give me one minute, as I have to leave the House and I should like to make my peace with the noble Lord, Lord Craigton. If I have given him the impression that I was rather hostile to his general approach when he was opening the debate, I want to make it perfectly clear that I was following him but wondering whether he was adopting the, balanced method of debate we prefer to have in your Lordships' House. Therefore, if he feels that I have been somewhat unkind, perhaps he will excuse me. I withdraw any kind of reflection on him that he thought I was making.

LORD CRAIGTON

I did, my Lords, and I am extremely grateful to the noble Lord.

LORD BRECON

My Lords, may I ask just one question? The noble Lord, Lord Snow, assured my noble friend Lord Drumalbyn that there is a Scotsman on the Council for Technology. I would ask him why there is not a Welshman, and whether he will add one more to it and allow the Principality to help on that Council.

6.2 p.m.

VISCOUNT STONEHAVEN

My Lords, I want to join other noble Lords in congratulating the noble Lord, Lord Hughes, on his appointment on the other side of the House. Like many other noble Lords, I have pleasant memories of associations with the noble Lord, but perhaps somewhat more humdrum. We appeared together on Grampian television, where we sat on chairs and had our faces powdered—and the noble Lord had his head powdered, too.

My interest is really in the North-East, but I am not going to talk about that now because I have been rightly warned off talking about that. However, I want to give advance notice of one or two questions that I should like to ask later on. I do not want answers now but I should like to put in my spoke. In general, the question of the North-East area must revolve to a large extent around its indigenous industries, which are largely concerned with agriculture, forestry, fisheries and tourism. I am not going to talk about any of these now, but I would ask the noble Lord if he will inquire into the possibilities of creating a new industry for using small sizes of timber, other than the pulping industry which is out of our reach. In particular, I should like to know what has been happening about the possibilities of producing laminated scantlings of standard sizes for use in building.

Also, is anything being done about the modern technique of finger-jointing of the short sections of timber which we often get when cutting young wood? They are quite large pieces of wood but short. The difficulty of using these has been overcome overseas by finger-jointing, by means of which they build up full-strength timber in sections of any length. Industries of this type would be applicable to the North-East. I put these questions forward now so that when we come to a debate which is to be held in a few weeks' time, when I shall be speaking about these matters again, the noble Lord will have had warning that I am bringing up these points.

I should like to have my say on transport. In regard to road transport, it is a pity that local government priorities are not scrutinised more closely. I think that the butter should be spread thicker where it is wanted and not so thinly over the whole job. Local politicians would not agree with that, but I think that in the national interest this is true. As to railways, Governments come and Governments go, but among those on either side of the House I stand in solitary splendour and support British Railways. I think that the long-distance railway service is magnificent. If you want a better service than you get between London and Aberdeen you can go round the world three times and will not find it. That is my stand on the railways.

As regards air travel, I am tempted to tell the story of the Aberdeen professor who went to Glasgow to speak at an important lunch. He took off from Aberdeen and landed in Inverness, where he remained for a couple of days. We must remember that our Scottish weather conditions are not ideal for air travel. There is no greater service which the noble Lord could do, if he is a superman—which I think he is—than to din into the heads of B.E.A. and all the other airlines that people do not like sitting on their behinds for forty-five minutes waiting to get from one aeroplane to another. No doubt this was necessary when they had to weigh carefully every passenger and his luggage for the kind of aeroplanes used years ago., Now, if you turned up with a steamroller it would not make any difference. This kind of situation is intolerable and does a lot of harm. I wish that the noble Lord would do whatever he possibly can about this little problem.

If the noble Lord has already delved into his files, he will have found a file about the Glenfeshie road scheme, or controversy. I would point this out to him. If he goes to Norway, when he gets time, he will find that in spite of the climate there is hardly a paved road in the country. All the roads are gravel. They carry very heavy traffic and keep open, except in the most severe snow, and are perfectly adequate for the heavy traffic they carry. That is one point. The other is that if he will look into the accounts of the Forestry Commission, he will find that the Commission can make a road, according to their estimates, for £3,490 per mile up to their full standard. There is a 14-mile gap at Glenfeshie. I would suggest that, if the noble Lord looked at it from the point of view of making a dual carriageway—that is to say, two Forestry Commission roads—he could get them made at a cost much below £100,000 and have two first-class roads for reconstruction at a later date into a final road system. In the meantime, they would open up quite a large part of country for forestry work to Fort William and have very great tourist and winter sports advantages.

It is only because people start talking about so many millions of pounds being involved that road schemes are put off. I think that we should look at what the Forestry Commission do and let them take this on to see whether they cannot do it, and do it for less. I very much hope the noble Lord will look at this question on these lines to see whether something of this sort could be done. Nothing is done by people who want perfection before they do anything at all.

That is all I want to say. I may have to catch a train before the noble Lord replies, so I hope that he will forgive me if I do not wait. I have said nothing to which I want an answer, in any event.

6.10 p.m.

THE MARQUESS OF LOTHIAN

My Lords, I should like to join in the general thanks expressed by noble Lords to my noble friend Lord Craigton for enabling the House to discuss Scotland to-day. I should also like to add my congratulations to the noble Lord, Lord Hughes, on his appointment, and to wish him well in his new post. We all know that he has the welfare of Scotland at heart, and I am quite certain that he has the talents to carry out his task. While I do not wish to go into this in detail, I would associate myself with what my noble friend Lord Craigton and others have said regarding the division of posts in the Scottish Office. I think it is a pity that the noble Lord, Lord Hughes, is not Minister of State. I believe he will find things difficult, and I hope that perhaps the Government may reconsider the position, in the light of what has been said in this House to-day. It is to me possibly just another example of the fact that we have exchanged a Scottish Prime Minister for an English one.

My purpose in intervening briefly in this debate is to refer to that part of Scotland where I live, and which I know best—namely, the Border, to which my noble friend Lord Drumalbyn has already made reference. As many noble Lords know, all is not well in that beautiful region, because we are living under the shadow of a fundamental and, so far, permanent problem—that of creeping depopulation. Year by year the figures of population are gradually going down. It is a slow and not easily perceptible process. But if it is allowed to continue, I am afraid that the area will become one of an economic and social tragedy; and it will also place art increasingly difficult burden on the remaining ratepayers.

The reasons for the depopulation are, I think, quite simple. They are two. First, the increasing mechanisation of agriculture has mea it that less labour is needed on the land. This is inevitable, and is an excellent thing, provided that it produces a more efficient agricultural community. The other reason is the general lack of new light industries to supplement the four main Border trades of tweed, hosiery, farming and forestry. A further problem lies in the fact that, as your Lordships know, the tweed and hosiery industries employ a preponderance of female labour, and even now some of this is begin fling to be imported from as far as 40 to 50 miles away. The result of all this is an unbalanced and unhealthy social climate, with the woman working in the factory, and, as my noble friend Lord Drumalbyn hinted, many of the menfolk finding employment outside the region, and even living outside the region. I think your Lordships will agree that this is not a desirable state of affairs.

That is a brief outline of the picture. It is a picture which the casual visitor, who sees the prosperous farms and lively, industrious little towns, does not always appreciate. But I can assure your Lordships that the Border people are well aware of it. The last Government were well aware of this, arid I trust that the present Government are equally aware of it.

Of course the solution to this problem is not an easy one, b at I should like to make a few brief suggestions. The Border has never been classified as a development district, because. I think there is little or no unemployment there. Even if this is based on the excellent principle of "first things first", it seems to me to be a slightly short-sighted view, for depopulation can have List as serious consequences as unemployment, if less obvious ones. I feel quite certain—and I think local opinion in the Borders would agree with me—that unless and until industrialists and manufacturers are given positive financial inducement to come to the Borders as they are given to go to other parts of the country, they will not do so. A good supply of labour and beautiful scenic amenities are not enough: grants, cheap borrowing facilities, depreciation allowances, and so on, are required. In fact, as usual, it is money that "talks" in these matters; and I do not think it would have to talk for long for small industries—and I am thinking particularly of those which might draw their raw materials from the area, such as timber and the output of the forests—to be persuaded to come to the Borders.

In my nearest town, Jedburgh, which has a population of about 4,000, two factories have closed in the last two or three years, one a tweed factory and the other making blankets. To balance that, one American-owned factory, making precision tools and now employing about 250 people, has opened. It is interesting to note that this firm have opened up their business in a factory built and financed by the county council, and they are repaying the county council in instalments. But the point is that one or two factories of this sort are simply not enough. It means that there is a lack of competition for labour; wage rates suffer accordingly, and there is insufficient demand and stimulus for the local councils to provide more housing and the civic amenities which a developing community should have.

I think that we have in the Borders at present too many industrial eggs in too few baskets. That is why I suggest that Her Majesty's Government should consider setting up one or two industrial estates, sited near some of the smaller Border towns. I believe that this would be preferable to a completely New Town, as it would spread the benefit of industrialisation widely throughout the region; and although it would present a difficult housing problem for smaller burghs and towns, it would have the added advantage of giving live status and viability to these small towns. It would also have the advantage, one would hope, of increasing the supply of local female labour. And if the population grew well enough, it would enable some of these towns to have rather fuller educational facilities than they have at present, in a situation where children over the age of, say, fourteen, frequently have to travel long distances to school to complete their education. But this is a point about which my noble friend Lady Elliot of Harwood is far more qualified to speak than I am.

If the Borders are to be revitalised (and I hope that I may be forgiven for returning for a moment to my former subject) it will be necessary to come to a quick decision regarding the provision of a new general hospital for the area. The existing hospital, which is a war-time temporary hospital, is doing a fine job, and it has recently been upgraded. At the same time, it is not adequate, I think, for the demands and standards of modern medicine; and with any increase in population and industrial development it will clearly become quite inadequate. Whether there is to be a new hospital on the same site or a new hospital on another site is, of course, a matter for the hospital board; but it is important that some decision should be taken soon. The present uncertainty is bad for the doctors, for the staff and for patients, and no real long-term planning can be undertaken. I would ask the noble Lord to bear this in mind, because I think it is one of the most urgent requirements of the area.

Another requirement would be—and this has been touched on by several of your Lordships—the improvement of road links. I think much more urgent consideration should be given to a reappraisal of this problem. We know that it is being done in the long-term planning, but in my area these links will certainly need to be improved. Although tourism is quite outside the scope of this debate, it will, I feel sure, become one of the main industries of the Border region. For that reason alone, there is a great argument in favour of increasing and improving the road links that we have. I am not going to discuss forestry, although it is an increasing Border industry. I understand, and hope, that we shall have an opportunity of debating that subject before very long.

My noble friend Lord Craigton has referred to the question of local government reform, and I should like to endorse what he said about this, for it is, I think, a matter of particular interest to the Border country where there are several small, and comparatively poor, local authorities. There may be advantage in amalgamations, but I know that the proposals contained in the White Paper have for some time been under active consideration. My noble friend Lord Craigton has told us that. What we do not know is how the new Government are approaching this rather delicate problem, and I should be grateful if the noble Lord could throw any light upon it. Equally, as I think has already been said, your Lordships might like to have some information about the Board of Trade Survey which was started a year or so ago: what progress is being made, and when we can expect a Report. The last Government were hoping to produce their Report by, I think, the summer of 1965. Is that still going to be the case?—because when this Survey was set up it was felt that it was going to contribute greatly to a solution of the serious problems of the Borders, some of which I have touched upon to-day. So I hope the noble Lord will chase this up and see that we get it on time.

In view of the lateness of the hour, and the many speakers in the debate today, I have tried to confine my remarks briefly to some rather local and parochial problems. I would, in conclusion, ask the noble Lord, Lord Hughes, very earnestly not to forget them in the welter of other and, perhaps, more dramatic-sounding issues with which he will be faced, for I think that if ever there was a case for "a stitch in time", the Border regions of Scotland is that case.

6.23 p.m.

THE EARL OF CROMARTIE

My Lords, I should like to start by adding my tribute to the noble Lord, Lord Hughes, in his new post. I shall not forget his kindness to me after my maiden speech in your Lordships' House, when I broke several Rules of procedure He was very kind about it.

As usual, and quite naturally, the majority of your Lordships have spoken of the industrial belt and the Borders. As usual, I will come back to the Highlands. There is to-day a more acute awareness of the problems of the Highlands than there has been for over half a century. There has been a determination on the part of informed Highlanders to make their views and aspirations felt. The reason for this was the indirect result of the proposals made to abandon the railways flora and west of Inverness, and of the introduction of new ferry services to tie Islands which are designed to meet the convenience of the tourist and not the needs of the inhabitants. Transport is paramount in any consideration of Highland problems, and unless the needs of the inhabitants are given priority over other considerations when transport is being planned, there is little hope that other suggestions for a revival of economic activity could be implemented.

A report on the present state of the Highland economy, and on how best improvements can be made, has recently been published under the title of Highland Opportunity. I have no doubt some of your Lordships have seen it. This report has listed important sources of weakness in the economy, such as the inadequate use of land, the wide dispersion of labour, the small proportion employed in manufacturing industry, the small size of commercial units, and the under-utilisation of crofting capacity. It has suggested, among other things, certain principles for the expansion of the Highlands: that they should exploit their own resources; that they should export out of the Highlands, and that they should develop products of high value, et cetera. What is of interest is that recently a London Ism of business consultants, without prejudice or knowledge of the Highlands, should consider the potential profitability of this lonely but magnificent countryside to be very considerable.

May I emphasise this belief that expansion of economic and industrial activity would be profitable? May I also suggest that, with sensible Government policy, the Highlands can be immensely profitable, not only to those directly developing the undeveloped potential, but also to Britain as a whole? It seems essential that a centre to co-ordinate further research and development should be established in the area, and that its activities should be controlled from within the Highlands. A great chance was missed when the new Scottis university was not given to Inverness. However, with the proper policy for the use of land, with capital grants for the reclamation of potentially fertile land and, most important, maintenance grants for the succeeding ten years, payable, like the aban- doned marginal agricultural production grants, only on condition that lime and fertilisers are liberally applied; and with low interest loans available for the stocking of the reclaimed glens and slopes, this country could produce the store stock which are, and will be, so badly needed for fattening in the South to replace the imported meat which will become more and more scarce as the world population rises and the standard of living in the primitive countries of the world rises.

The development of forestry can go on side by side with this regeneration, and can assist it by giving shelter and access roads. At present, forestry employs four times as many people to the square mile as hill sheep farming and the sporting use of land. I would suggest that on reclaimed and properly enclosed and stocked land, farming could employ double the men that forestry employs. For this development to take place, it is essential that there is a proper policy for the use of land, and that the Highland Development Board, when it is set up, has powers to study land usage. I believe that in very similar Scandinavian countries many of these problems have already been overcome.

The Board will also require powers to deal with any selfish use of Highland land resources. I am not suggesting for one minute that there is no room for sport in the Highlands. It brings to our country a great deal of money, and provides employment and a way of life to a very fine body of men. I refer, of course, to stalkers, keepers and ghillies. But sport must not be allowed to act as a barrier to the re-population of the Highlands, or prevent the growth of amenities. It should, on the contrary, be another source of employment and benefit to the Highlands.

At the same time as consideration is given to the basic primary industries of agriculture, forestry and fishing, it appears desirable that incentives should be designed to encourage industry to develop, not in the overcrowded South, but in the empty North, where there is an abundance of land, clean air, good water and electricity; and where there is labour of a high degree of integrity and intelligence available. Most of the Highland areas are scheduled development districts, and receive the usual incentives in grants, loans and special depreciation treatment. It would appear that it would be in the country's interest—I mean the interest of the whole of Britain—to offer an extra incentive to deal with the one great disadvantage suffered by the Highlands to which I drew attention earlier on, namely, transport.

A decision to apply a tapered freight rate and a reduced fuel tax within the area would, I think, have a dramatic effect on this region where, between 1951 and 1961, 5 per cent. of the mainland population and 10 per cent. of the island population left, and where many of the young people of enterprise and talent are being forced to leave and find opportunities of employment commensurate with their abilities. What better place to site some of the new industries of the 1970s and 1980s than out of the existing overcrowded centres of industry in the South? This "Northern Six" of Great Britain I believe to be an area of unlimited possibility whose development becomes more and more essential to the development of Great Britain as a whole.

Turning to another industry whose potential is important, but not all-important, and I refer, of course, to the tourist trade, I was going to read out an extract from the Highland Opportunity report on this question, but it is rather long and time is short so I will not; I will spare noble Lords that. But I suggest especially that those noble Lords on this side of the House who have been closely concerned with the tourist trade should read this, because it qualifies quite a number of the conditions and is rather critical of the appeal to the mass tourist trade which is probably (and I agree) not a good thing. Briefly, their suggestion is that the tourist trade in the Highlands should to a great extent be selective. I will not go further into that question, because it is all laid out, extremely clearly; but I think it is very important.

I know that these particular few paragraphs in the report will not be popular among a certain type of hotel-keeper and a certain type of development tycoon from the cities. But just to give your Lordships a little example of my own experience in the West Highlands, I will tell the following story. A hotelier friend of mine, who is a cultured and educated man, had as one of his guests an obviously prosperous man from the South who, during the course of his conversation, said how much he would like to see the Highland glens filled with Wimpey Bars. The gentleman could not quite understand the rather unenthusiastic reception he got from the hotelier. That, quite briefly, is what I am trying to say. We all know that there is a tremendous future for the tourist industry, but it must not take the place of the far more important and far more worthwhile aspects of development which we all want in the Highlands.

Finally, my Lords, I should like to mention briefly the suggested changes in local government—not that we in local government know very much about them yet. Some changes may be necessary, especially if they entail the transference of certain rate burdens from local to the central Government. But let us beware of creating a condition when the local authority councillor ceases to represent the people and becomes just another faceless civil servant. This would, I think, become inevitable if, in the huge areas of the Highlands, the county councils were to be replaced by regional councils.

6.35 p.m.

LORD BALERNO

My Lords, I should like at the outset to draw your Lordships' attention to two scientific developments for which Scotland is uniquely placed to provide the home. The first is the National Resources Council recommended by the Trend Report. The Slater Committee, which reported on this, blandly assumed that the Council should operate from London. To forward their policy of restricting the construction of offices in London, I trust that the Government will take note that the location of a new body presents them with a wonderful opportunity of implementing that policy by placing its organisations throughout various parts of Britain, thereby also spreading economic growth.

The Natural Resources Symposium organised by the Scottish Council in 1960 clearly demonstrated the fundamental—and, I would add, peculiar—importance of this subject in Scotland. Natural resources development will involve many existing Government Departments and establishments. The chosen location must have a strong departmental framework, and such a framework, I submit, exists in Edinburgh; and forbye (as we say in Scotland) the University of Edinburgh has recently created a Chair of Natural Resources, and the Professor has got down to his job. The noble Baroness, Lady Horsbrugh, has reminded the noble Lord, Lord Hughes, of his own views on the movement of Government offices. And here, with the placement of new offices, he has a wonderful opportunity of immediately implementing his own convictions.

The noble Lord. Lord Hughes, whom I should like to congratulate on his new post, has done some exceptionally good work for the hospitals and medical services in Scotland, and the second development to which I wish to draw the attention of the Government, and to press upon them, is the decision of the World Health Organisation to establish a World Centre for Medical Research. I would press it not only on the grounds that Edinburgh is a capital city—in every sense of the word—or that the Medical School of the University is renowned for its research, but at least equally because of the great capacity that the Scot has shown in his ability to play a part in the affairs of the world. And in this connection may I say that it has been particularly gratifying to see the noble Lord, Lord Boyd-Orr, in the Chamber of the House yesterday and to-day. No Scot has done more than he has in international affairs for good and health. I understand that the World Health Organisation are likely to reach a decision next year. I hope that we may receive from the Government an assurance that they are alive to the possibilities and that our case will be vigorously presented at Geneva.

I wish to draw your Lordships' attention to the drain away from Scotland of her young scientists and technologists; and I do so not only in order to emphasise the grave personal problem that confronts these young men of talent or to re-emphasise the perennial complaint about the migration of the Scot. Please God we shall always produce in Scotland young men, scientists included, who have the urge to adventure furth of Scotland. This is a natural phenomenon of the Scottish race. Not all Scots are driven out through poverty at home or the lack of opportunity. Many Scots are born with "itchy feet", and these we are usually glad to export.

I should also like to place on the Record that there is a steady, though small, flow of young scientists in the reverse direction from the Adjacent Kingdom and Principality into Scotland. In Scotland we welcome them for their charm and their more sophisticated way of life, but more for the resulting cross-fertilisation of ideas and techniques. That they are welcome can be gauged from the large proportion who settle in Scotland and for the rest of their lives eschew the fleshpots of the South-East of England.

My Lords, that is my purpose to-day, to make this point: that after allowing for the adventurous Scot and for the immigrant English, there is a substantial net flow out of Scotland of scientists and technologists; and this net flow is the manifestation of a much deeper trouble in the industrial bowels of our nation. Before I elaborate on this, I should like to give some figures to illustrate the extent of this problem.

In the Toothill Report on Scottish industry figures are given of the degrees and diplomas awarded in pure science and technology. Expressed as a percentage of Great Britain, Scotland produces 11 per cent. of the graduates in pure science and over 18 per cent. of the diplomates in technology, making a combined total of 12½ per cent. Against this we must put the percentage of posts for scientists and technologists in Scotland as compared to the United Kingdom. An inquiry made by A. G. Clement and Robert Robertson, through an examination of posts advertised, revealed that in 1960 only some 3 per cent. of the British total of scientific posts in industry were to be found in Scotland—and we are producing 12½ per cent. of the scientists and technologists.

Had it not been for the enlightened attitude of the Department of Scientific and Industrial Research, and also of the Atomic Energy Authority, this figure would have been very much lower. Indeed, it is largely because of them that this figure has probably risen in the last three or four years, and stands now possibly at 4 per cent., or maybe even at 5 per cent. But taking it that the proportion of persons employed in industry in Scotland as a proportion of the United Kingdom is 9 per cent., to employ in Scotland only 4 per cent. of the scientists and technologists produced is a very poor show. My thesis is to uncover the reason for this astounding discrepancy, a discrepancy which, if it is allowed to continue, is bound to lead to more rumblings of discontent from North of the Border.

The conception of a proper infrastructure of industry, which is so much spoken about, is accepted as the prime requisite for expansion anywhere. I do not quarrel with this conception, but in this age the most important item, I submit, in this infra-structure—that is, science and technology—is often forgotten. To have industries and factories that are virtually little more than assembly plants adds little to the permanent wealth of the nation. In the event of world recession these outlying factories will be the first to close. I should like to quote a submission by the Scottish Council to the Secretary of State, made, I think, last July. They wrote: In many industries the dynamic source of growth is technology—the continuous and rapid use of scientific knowledge. This is just as true of the development and survival of established products as it is of the evolution of new products. Recognition of this proposition which the Scottish Council have made is absolutely fundamental to any discussion on the development of industry in Scotland.

The greater part of all research and design in Britain is paid for by the Government and the nationalised industries, which also dominate the market for many products of industry. The location of Ministries and head offices in London has resulted in the extremely uneven spread of that knowledge which is the dynamic source of much industrial growth and, consequently, of new business. This is the principal reason for the magnetic pull of London for many industries. New knowledge is thought to be more easily accessible to companies near London. Government administrators, scientific staff and Treasury officials collaborate in letting contracts, and this means that Government laboratories in the spending departments have to be in the South. But, my Lords, is this true? Must they be in the South? The South-East of England enjoys no special natural advantages. Why do we blandly assume a continuing immigration into the South-East at a rate of 50,000 persons a year when the main reason for so doing is the inefficiency in communications between Government Departments and the centres where scientific research is carried out?

I agree that the spread of new ideas and information about opportunities are essentially a function of personal meetings, but does it necessarily follow from this that the centres for industrial research must be grouped into the South-East of England? Consider biological research in Britain—medical and agricultural. The centres for these are well scattered throughout the land and have been able to overcome this communications difficulty. Given a proper appreciation of the problem, surely this can also be done with industrial research.

I would repeat that it is the Government Departments and the nationalised industries that pay for the larger part of all the research and development work undertaken in Britain, and that a great deal of this is done within the laboratories and the factories of industry. If industry is to grow, as grow it must, then the source of growth must be more evenly distributed. The mere transplantation of companies alone will not do the job. This can be achieved by getting design and development work going on a larger scale within the laboratories and design offices of industry itself in Scotland and other places. If this happens, then growth will follow and will continue. If it does not happen, there will be no end to the need to import industry from the South, and the problem of an impoverished Scotland and North of England with the continuing spectre of unemployment will be ever with us.

Where the development of technology has been fostered in Scotland there have been remarkable results. Deliberately this has been done by the Government in the establishment at East Kilbride of the National Engineering Laboratory, and somewhat fortuitously around Edinburgh with the growth of the electronics industry. We in Scotland should not forget that the decision of the D.S.I.R. to open up at East Kilbride was taken when Sir Edward Appleton was its mainspring. This establishment, the National Engineering Laboratory, may prove as important to Scotland in the 20th century as the founding 150 years ago in Glasgow by John Anderson of the first college of technology in the whole world. With these two examples, the ultimate success of the policy of locating more industrial research away from London and in Scotland and the North of England. cannot be called in question. Only by this means can we get dynamic industrial growth, and continuing growth.

I would strongly support the plea of the noble Lord, Lord Drumalbyn, that additional tax incentives should be given to companies undertaking research and development in those areas where growth is needed. l hesitate to mention another form of financial incentive—rather is it, indeed, a disincentive to stick around London. So long as larger salaries are paid to civil servants and scientists in the London area, so long will there be a drift to the South, for quite a lot of social prestige can be gained from claiming to be in a better-paid job. I know that the extra salaries are in respect of the alleged extra hazards and expenses of living in London, but. I think it is time this matter was looked into dispassionately. I would submit that if salaries in and around London were the same as in Wales, Northumberland and Scotland, there would be much less reluctance to move out of the South-East of England.

LORD BRECON

In the manufacturing industries the average wage in Wales is higher than it is in London.

LORD BALERNO

The point I was making was about civil servants being compressed in the South-East of England and in the London area: and it is the higher wages paid Ito the civil servants that I am dealing with particularly at the moment.

There must also be a much wider acceptance of the potential of air travel, of which we have heard so much, and which, in point of time, brings Central Scotland as near to Central London as is the Southampton—Portsmouth area. I support the noble Viscount, Lord Stone-haven, about the frustrations of air travel in this Island, and this situation must be corrected—that long stand we have in the Palace of Cromwell Road as the passenger waits to get "processed"; or, on his return home, that frustrating 20 minutes or half an hour at London Airport before he can be reintegrated with his bag.

Last century was the golden age of Scottish industry. It was golden because, starting with Joseph Black and his discovery of the analysis of carbon dioxide, which led to the inventions of James Watt, it was science-based. Sufficient of the native genius for invention remained in Scotland to give us the steam engine, the reciprocating engine, the screw propeller and a host of other inventions. The engineers who were exported in those days were largely in the steamships that sailed the world. They returned to Scotland, and their sons went to the universities and technical colleges, only to find no outlet in Scotland for their inventiveness and industry.

To-day, opportunities for civil engineers in Scotland are few and far between. There are few physicists employed in industry in Scotland, the country of Napier and Clerk Maxwell. If the geophysicist wants a job he has to go to Dallas, Texas. The chemists cannot find a job in Scotland at all. Despite the fact that we have quite a few chemical industries in Scotland, most of the research is done elsewhere—though I am glad to note that the North British Rubber Company, in its development at Newbridge, is planning a new research centre. We are the country of Mackintosh who, with his rubber mixed with naptha, produced the mackintosh. We have lost that chemical inventiveness in Scotland, and our people have to go outside. But to-day it is coming back again; and, thanks chiefly to the developing electronics industry around Edinburgh, electrical and mechanical engineers in Scotland have a better prospect. I could expatiate further on this point, because I feel strongly about this impossibility of scientists, young scientific graduates and technologists, getting a job in Scotland. The boys at school know about this—their masters tell them about it. They hear about boys four or five years older than themselves graduating and being unable to get jobs.

I should like to conclude by drawing your Lordships' attention to a point of fact which you can easily verify by stepping across the road into Westminster Abbey. A scrutiny of the tombs and memorials of the scientists there will reveal that one-fifth of them were Scots. After making allowance for those Scottish scientists who returned to their native land to die, this, to a Scotsman, is a most sobering thought.

6.54 p.m.

BARONESS ELLIOT OF HARWOOD

My Lords, I shall not detain your Lordships for many minutes but, like all Scottish people, I should like in a debate of this kind to have a word. I think this debate has shown that one of our true characteristics is that we like talking. We like talking about ourselves, and we do not much mind if nobody else is listening. I have been watching the Benches opposite, and I must say that while I am most happy to congratulate the noble Lord, Lord Hughes, on his appointment, I really have to condole with him to-day because, when the noble Earl who follows me has spoken, we shall have had 13 speeches from this side of the House as against one from opposite. The noble Lord, Lord Greenhill, splendid as he is, was their only speaker, and there is Lord Hughes to wind up. However, I have a strong feeling that, as a staunch Presbyterian, he probably has, somewhere within his make-up, a sling which he will be able to use as effectively as did David against Goliath. We on this side have provided him with some thirteen targets. I only hope that he will not knock us all down because, in point of fact, I think that most of us are anxious that he should make a success of his job. As somebody has said to-day, we are all anxious to see benefits coming to Scotland, a continuing process of that which we on this side believe to have been carried out in the last ten or twelve years.

I should like to congratulate, too, my noble friend Lord Craigton on the splendid way in which he conducted his office during the last Government. One has only to travel to Scotland, as I do, and as I did particularly during the Election, to see the tremendous developments that have taken place in the great industrial belt. The noble Lord who has just sat down spoke about East Kilbride and the research centre there. In East Kilbride one can see a place which, ten or so years ago, was a tiny village, where there is a splendid new town, marvellously set out, wonderful roads, wonderful communications, first-class factories, and where 39,000 people are living to-day. This is an achievement. The noble Lord, Lord Hughes, himself has been chairman of another great new town in Fife.

So we have not to take a depressing view about Scotland, because we are a highly developing and enthusiastic people who are only anxious to do more than is being done at the present time. We hope that Lord Hughes will carry on this work, and that we shall not have to come back here and find out that things have gone backwards when we are anxious that they should go forward.

I should like to say a word about the area in which I and the noble Marquess, Lord Lothian, live, which has been, I am afraid, one of the less developed areas in recent years. I do not grudge the central belt of Scotland its prosperity. I do not grudge the developments that have taken place there; it is all right and proper. But let us look a little at other areas and see what can be done to help them. The Borders is a curious place, because one can say that it is right in the middle of Scotland, that it must be an easy place to reach, and so on. But in point of fact, although the Highlands look so far away and so underpopulated, as it were, the Borders are far south and we have a kind of invisible barrier which is the frontier with England. I am not saying this in any antagonistic spirit at all, because we go backwards and forwards over the frontier and nobody really knows which is one side and which the other, except those who live on the North side. But it is a fact that we in the Border area are quite isolated from the industrial developments, with the result that we find it difficult to attract industry and to keep our people in that area.

The three reasons why I think we ought to do something for the Borders are: to stop depopulation; to provide a balanced employment position there; and to provide the additional labour, particularly by women, which we need for our hosiery industry. Another curious factor is that we have not really got an unemployment problem, either. Our unemployment figure is between 1 and 2 per cent. In October of this year it was less than 1 per cent. One cannot plead that there is r o employment there; there is employment, but people are leaving to go to the industrial belt, and also they travel out of the area. We want to try to develop certain industries in order to keep our people, to prevent depopulation, and to bring prosperity to the Borders.

There is one industry which is capable of expanding and is, in the technical term of to-day, called a growth point—that is, the hosiery industry. The value of that industry in 1959 was £22,815,000; to-day the value is £27,944,000. That is an increase of 22 per cent. I believe that the town of Howick, very near to where I live, has the biggest exports per head of population of any town in the United Kingdom. This may be a tall story, but it is one I have teen told on several occasions, and I believe it to be true. When exports are the one development which we are really working for, here is an industry which could expand if labour were available.

The labour needed is women, on the whole, and therefore it is difficult to get more women unless one also has another industry which will employ the men. In this modern world where men and women both work it is employment for men which we need to find. This is one of the reasons why I hope that the noble Lord, when he is studying this matter, will look to the Borders and see whether we cannot make in the Borders, as the noble Marquess has suggested, an industrial estate; or, if not, take an area near one of the big towns and develop it so that we can enlarge the hosiery industry.

I must not talk for long because of the time, but I should like to say one other word. I join forces with the noble Viscount, Lord Stonehaven, on the subject of railways. A great deal has been said about air travel, and I am not in the least opposed to it, but I am a staunch supporter of the railways. I travel twice a week on the railways from my home at Howick and back again. I prefer the railways to any other form of transport. The railways in the Borders are very important indeed; they are, in my opinion, every bit as important as they are in the Highlands. Unless one has a railway which goes through the Border from east to west, from Edinburgh to Carlisle, and which passes through all those small hosiery towns which are capable of great development, one is going to cut off that area completely. Any money which is spent on the roads will improve transport conditions, but we happen to live in a cold climate, and in the very severe winter only two years ago the roads were blocked and one could not travel anywhere. The railways remain open nearly all the time, and it would be a disaster if they were closed.

Dr. Beeching has his finger on that railway in his Plan which we all know so well. He has scheduled what is called the Waverley line to be done away with. I hope that the noble Lord, Lord Hughes, will consider this matter very carefully indeed. If the railway is taken away from the Borders that area will be completely isolated. Perhaps some day there will be found a place for an airport, though it would be very difficult in such hilly country; so it looks as though the transport in that area must remain railway transport. I hope that we shall be able to preserve our railway. It may need to be altered; perhaps there may not need to be so many stations—I do not know; but let us have this line which links us with Edinburgh and Carlisle and enables us to travel through the Borders. Otherwise it is a matter of travelling 40, 50 or 60 miles before one gets to a railway station. I beg the noble Lord seriously to consider this, and he will then earn the gratitude of the Border people.

That is all I wanted to say. I think it is important that we should not leave out this area. It is said that there is so much depopulation that the work is not developing there as it should do. We could speak of the agricultural and forestry activities which are carried on there, but, as the noble Marquess has said, the number of people in those industries goes down with the efficiency and additional mechanisation which takes place. Therefore, if we are going to keep our young people and to offer them a future in that area, it is necessary that we should at some point of development find a growth point, which I think is there if it can only be taken up. I ask the noble Lord, in this long marathon to which he has listened all the way through, not to forget this area.

7.5 p.m.

THE EARL OF PERTH

My Lords, we are all most grateful to the noble Lord, Lord Craigton, for initiating this debate at this rather early moment of time in the new Government. Our purpose in Scottish debates, as your Lordships well know, is not to be contentious or to score Party points, but rather to put forward suggestions of the various ways in which we think the Government may be able to help things to go forward in Scotland. Therefore, to have an early debate while things are fluid must be good. I hope the noble Lord, Lord Hughes, will find that what we have all tried to do and say will perhaps be of use to him in his battle with other of the Government Departments with which he has to contend. It is already after seven o'clock, yet we have confined our debate to-day to Scottish industry. That is just as well. But we have been able to do that with a fairly clear conscience because we know that before long we shall have another debate which will cover matters like the Highlands agriculture, forestry and tourism. We shall have an opportunity to discuss those subjects when we ask for the second part of the debate.

I certainly want to join everybody else in congratulating the noble Lord, Lord Hughes, on his position. I do not want to go into the question whether or not he should be promoted, except to say that I think the anxiety on that point, quite apart from his own merits, is based on the fact that, by his not being promoted, we may find Scottish affairs becoming more and more centralised in Whitehall. This is a process which the last Government were able considerably to reverse.

Again, I wish to join with many other noble Lords in congratulating the noble Lord, Lord Craigton, and indeed the previous Secretary of State for Scotland and others, in being able to reverse the process and in making us feel that things were happening in Scotland for Scotland. That is why we have this anxiety on the question of the status of Lord Hughes. I also wish to congratulate Lord Craigton, and others who were with him in the Scottish Office, on the great progress which we saw in Scotland during their tenure of office. They faced a difficult task. The wheels of heavy industry were running down.

The problem was what could be done to stop the process, to get it reversed and to get the light engineering and other industries going. The record shows how well they succeeded in achieving this. I only wish that the new Government will continue the good work and, indeed, ensure that what has been started will go ever faster and faster.

It is very important that the new Government, in making their new surveys and new planning, should not upset the existing mechanisms, which are delicate mechanisms and could easily be upset. The fact that one may set up additional boards is not in itself an answer which means that you will have new industry, or more industry, or an increase in industrial output. Bureaucracy itself is not industry, nor does it produce industry. I have particularly in mind that nothing should be done to upset the work of the Scottish Council. Your Lordships all know what a splendid job it has done.

Curiously enough, I found on my breakfast table their Annual Report for last year. I looked through it, and I was particularly struck by the immense amount of work that they have been doing overseas. They do it every year, but this year is perhaps the outstanding year. They have been with special missions to America, they have been to Canada, they have been to Western Germany and they have been to the Benelux countries. Your Lordships all know what the result has been. Industry, particularly from North America, has come over to Scotland and set up there. One of the really key factors in our renaissance has been that American industry and foreign industry has been setting itself up in Scotland; and great credit for that is due to the Scottish Council.

Knowing the shortage of time, I want to turn to just two specific points. Before refer to the first, I should like to read—perhaps this is hardly fair, but never mind; I am going to do it—an extract from the speech of the noble Lord, Lord Hughes, at the time of the debate on the development of Central Scotland and North-East England. I want to read this extract because it helps me, and I think will help him, on the first point which want to develop. He said at that time [OFFICIAL REPORT, Vol. 254, col. 292]: I would suggest to the Government that example is much better than precept, and that the Secretary of State for Scotland, with his colleagues, might make some arrangements for one or more Ministries to move some or all of their activities to either Central Scotland or North-East England. My Lords, that may be a pretty difficult task to carry out, at any rate in the first few months of office. But I am going to ask the noble Lord to do something which is somewhat easier—at least I hope it is easier. I am following in the footsteps of the noble Lord, Lord Balerno, in this respect, and I have another candidate for being stared in Scotland—the National Environment Research Council. I know that the Scottish Council have already made certain representations on that subject, but the location has not yet been settled. This does not mean moving a Government Department. This is a new organisation which I hope can be set up somewhere in Scotland, just as Lord Balerno hoped that the National Resources Council could be set up there.

Various noble Lords hoped that we might be able to see an international organisation set up in Scotland, and particular reference was made to the World Health Organisation. I am sure that this would he an excellent thing, and any international organisation which was set up, particularly in Edinburgh, for example, would never regret it. But there is one factor—and this brings me to my second point—which makes it extremely doubtful in my mind that we shall succeed in getting an international organisation with conditions as they are at present. I refer to the fact that if anybody from Europe wants to come to Scotland, they have to go through London. How can we hope to have any international organisation coming to Scotland, when they have always to go through London?

This brings me in detail to my second point, which is that I think—and I know that the noble Lord, Lord Forbes, and other noble Lords have referred to this matter—that the airport at Edinburgh is a national disgrace. There is one runway, and whether or not one gets in depends on the wind. Then, when you do get in, the buildings are such that very often there is standing room only; you cannot even sit down to wait, as so many people ate trying to get in. I think that nothing is more important as a matter of priority than getting on with the improvement of the Edinburgh airport. I believe one noble Lord made the point, which is a good one, that we are sometimes at risk in wanting to "spread the butter too thin". I know I have heard the pleas for airports at Dundee and other places, but once the Tay Bridge has been built the journey from Dundee to Edinburgh will really be no longer than from London to London Airport. So while I am not against the airport at Dundee, I am in favour of making Edinburgh's something really worth while.

It remains for me to wish the noble Lord, Lord Hughes, the best of luck in carrying on what the last Government started so well. If two improvements which so many noble Lords have mentioned and on which I have just touched—namely, some new research bodies or international organisations finding their way to Scotland, and a real improvement in the Edinburgh airport—could be seen to develop from our debate, then I think we should all be very happy.

7.16 p.m.

THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR SCOTLAND (LORD HUGHES)

My Lords, in the first instance, I have to express my very sincere thanks to all those noble Lords who have included in their remarks such a very generous welcome to myself in this office, although it must in some cases have been tinged with regret that it involved their own transfer to the other side of the House. But they were so very generous in their remarks that it would have been easy for anyone coming into this House without knowledge of politics to imagine that we were in fact all members of the same political Party.

Noble Lords will not expect me to go into too much detail in reference to the position of the Minister of State. All I would say is that I have taken a record of what has been said, and I find that if any one of eight noble Lords sitting on the opposite Benches should become a Labour Prime Minister during the period in which I am Under-Secretary of State, I can immediately expect to be Minister of State. All I want to say on that aspect is that it may be better to start off as an Under-Secretary, and perhaps have people saying later on, "It is worth making him a Minister", rather than to start off as a Minister and then have them saying, "He ought to be an Under-Secretary".

The debate, as Scottish debates generally are in your Lordships' House, has been very largely, though not entirely, on a non-Party level, and if I should stray from that occasionally it will be only because I feel it necessary in the proper presentation of the case as a member of Her Majesty's Government. I do not intend to dwell too much on what has taken place in the past, because if this debate is to serve a useful purpose it should be in relation to what is going to take place in the future. But I think I should very briefly say a few words of background to remind your Lordships that the state of the Scottish economy has not been a uniformly good one in the past.

It would be futile to go so far back as the inter-war year; that is now really history. But the post-war legacy of Scotland has not been as good as any of your Lordships would have wished it to be. There has been a consistently high level of unemployment, and when I say "high" I mean high in comparison with what prevailed in the country as a whole. If we were comparing the figures of unemployment in Scotland with what had taken place in the 'thirties, what we now regard as high figures we should then have regarded as being low. So at least there is improvement in that direction. The factor which has remained unchanged throughout all these post-war years is that, it has not mattered where the national level of unemployment has been, the Scottish level has consistently been at least twice that figure, and that is still the position to-day.

Another aspect which has been disconcerting is the slow growth of new jobs. It is surprising and disappointing to find, for instance, that in 1961 the number of men employed in Scotland was fewer than it was in 1951. The only significance of these two particular years is that they happen to be the Census years and the years for which the most reliable figures are available. The position since then, unfortunately, despite all the increase in new jobs, is really not appreciably better, and this is very largely because of the factor to which many noble Lords have referred in the course of this debate—the extensive emigration from Scotland, an emigration which grows progressively worse. In 1959 the net loss was 20,000; in 1963 it was 33,000; and this year it is almost certain to exceed 34,000. These are figures which a country the size of Scotland cannot possibly sustain if almost irrecoverable injury is not to be done to our economy.

It is distressing, I think, to find that our net emigration is, with one exception, the worst in Western Europe. I had in my notes the name of the country with the worst, and then I was told to take it out in case we had an international incident. This pattern must obviously be changed as quickly as possible. I believe it would be fair to say that it was the desire of my predecessors at the Scottish Office that it should change as quickly as possible, and I would assure your Lordships that this remains the prime objective of the new Ministers in St. Andrew's House and Dover House.

In recent years (I am now getting a little more political) it has become more fashionable to approve of planning, although the conception of planning of noble Lords opposite has been somewhat different from that of planning as understood on these Benches. The previous Administration thought of it mainly, if not entirely, as physical—the "infrastructure", for example. It was an essential part of planning, and we shall apply it vigorously; but we shall not repeat the mistake of thinking that it is the whole job. It must be complemented by calculated and phased economic growth.

It is significant that the principal examples of this phased, calculated economic growth are the New Towns, to which such generous reference has been made this afternoon. These New Towns came about in the first instance through an. Act of the previous Labour Government—a conscious intervention into deliberate planning of all the aspects of life of a community—and for that Act I should like to say that this country will always be in the debt of my noble friend Lord Silkin. This all-in development must be our general Scottish objective in which all areas in need will share—and I stress that point: that all areas in need will share.

The previous Government's "Proposals for Central Scotland" are being urgently re-examined, first to hasten the elements in that programme which are really fundamental to growth, and secondly to inject the necessary economic and industrial factors into it, in accordance with the principles I have just stated. This will not stop the Government from maintaining the high level of public investment which the regeneration of Central Scotland requires. I must emphasise, however, that this will not be done at the eventual expense of other areas. I am glad to be able to say that the comprehensive plans for North-East Scotland, South-West Scotland, the Borders and the Highlands are being pressed on and should be available, in all probability, by the middle of 1965.

The Borders have figured in more than one speech this afternoon, and the noble Marquess and the noble Baroness both spoke particularly about them. I should like to mention something of the work being done by Government Departments which we have inherited and we are continuing, and the Borders are a very good example. The Study which the Scottish Development Group are doing has made good progress. This is not the time to talk of solutions, or to hint at emerging recommendations, but what I should like to emphasise is how greatly we have gained in our understanding of the real and deep-seated problems in the area by the full and frank discussions which we have pursued with the tweed and knitwear industries there.

I must pay a grateful tribute to the cooperative attitude which both these industries have displayed, which has permitted a wide-ranging discussion between the Departments, on the one hand, and the representatives of industry, on the other. The result has been constructive and, in the best sense of the word, educational; and both sides, I believe, feel the same. There is no question at all here of Government interference in the legitimate freedom of businessmen to make up their own minds and to make their own decisions. It is simply a means of sharpening the awareness of both sides to the real and long-term problems ahead, and of bringing out more clearly the total situation in which, on the one hand, management decisions must be taken and, on the other, planning proposals must be made.

For this task I am confident that the new Scottish planning machinery of which I shall be speaking will be a much better instrument than we have ever had before. Under the guidance of these bodies, we hope to forge links with Scottish industry and to get to grips with the real economic problems of our country. In that connection, I am very glad that the noble Lord, Lord Polwarth, thought that this deeper involvement in planning which he saw forthcoming from the new Government was one to which he and the Scottish Council could give a warm welcome.

Noble Lords are aware of the Government's determination to have a plan for the whole country which will set the right economic targets, and to take the necessary measures to attain them. This plan will be prepared under the direction of the First Secretary of State, and will establish the framework for regional planning throughout the United Kingdom. Within this framework, the Secretary of State for Scotland will be responsible for Scottish planning. Bearing in mind the wide planning—physical, industrial and economic—to which I have already referred, my right honourable friend will reconstitute the Scottish Development Group as the Scottish Planning Board. This will be strengthened in various ways, and provided more directly with economic advice.

The Secretary of State will also appoint a Scottish Planning Advisory Council, whose membership will draw on all the major interests shaping the new Scottish economy: both sides of industry, commerce, local government, the universities, the nationalised industries, et cetera, as well as individuals with special contributions to make to its work. The new machinery will cover the work of all Government agencies working in Scotland. In making these arrangements, my right honourable friend has also in mind the need to take account of the requirements of particular areas of Scotland. We intend to give to the people of Scotland the widest possible say in shaping their future to the patterns of prosperity.

I well remember how, in our last big debate on the Scottish economy, the noble Lord, Lord Polwarth, spoke of the need for both a "big stick" and a "juicy carrot". The Board of Trade are now doing what so many Members of your Lordships' House pressed for then, and, in some cases, had been pressing for for years. The programme of advance factories has been considerably expanded in the announcement made a week ago by my right honourable friend the President of the Board of Trade. These nine additional Scottish factories will undoubtedly help to sweeten the "carrot". The fact that they are all in the central belt is perhaps unfortunate, from the point of view of the other areas, but nine factories in six weeks is pretty good going. I do not say that, arithmetically, we are going to keep it up, producing another nine every six weeks; but I would suggest that the other areas need not feel unduly disappointed that they are not included in the first six weeks. The review of the South-East Survey, the restriction on office development and a very much tougher policy in relation to the issue of industrial development certificates will undoubtedly reinforce the stick. I should like to remind your Lordships also, though many of you know this already, that the Board of Trade regional controllers have been instructed to take a tougher attitude to these applications for industrial development certificates in the really congested areas. This means that in the West Midland conurbations and in the London area industrial projects will not be given I.D.C.s unless there are most compelling reasons for doing so, and—I want to stress this—reasons which would have been accepted by the previous Administration will not be found acceptable to the new Government. With every industrial project it is brought to the attention of the Board of Trade, whether or not the firm has reached the stage for applying for I.D.C., that every effort is being made to persuade them to set up in a development district in Scotland or elsewhere if it will be at all practicable for them to do so.

Some of your Lordships may say that this is not very different from what the previous Administration were doing in these particular directions. I would say it is not. The difference is not in these cases in methods but in the extent to which the methods are applied; and my main criticism in previous debates has not been that the Government have been applying the wrong methods but that they have not carried out these methods to their logical conclusion. I hope that in due course your Lordships will agree that we are at least taking them nearer to a logical conclusion.

My Lords, may I now touch on some of the other issues which are vitally important to Scotland and its future prosperity? Some of these have already been covered by noble Lords who spoke. Nothing is more important in my opinion than research and development, and the whole question is being discussed with the new Ministry of Technology. It is not generally known that Scotland trains 1U per cent. of the United Kingdom output of scientists and technologists but employs less than 5 per cent; and the noble Lord, Lord Balerno, has given some figures which must be staggering to many of your Lordships and which give point to this and to the importance of dealing with this aspect. A wide-ranging list of possibilities is being examined, including much more direct intervention and encouragement by the Government to help firms to undertake major research contracts. The idea of linking our new universities of Strathclyde, Stirling and Dundee with this type of work is under examination. I could not resist the opportunity of putting in Dundee, although of course it is still some two years away.

LORD BALERNO

My Lords, would the noble Lord include the Herriot Watt College?

LORD HUGHES

My Lords, I am quite willing to include anything which would help. On this subject of research and development, if one turns to Table 21 of the South-East Study and examines the industries which grew fastest in South-East England between 1959 and 1962 one finds that these are all, by and large, the same as those which are known nationally to spend the largest sums on research and development, so I must agree with those noble Lords who have stressed the importance of this research. If we get the research in the right quantities and in the right places, the industry will most inevitably follow.

Training and retraining of labour got off to rather a slow start in Scotland, but firms are now responding a little more readily to the inducements offered. I cannot emphasise too strongly how important this is, as is also the part which Scotland must play in the industrial training boards now being set up. My right honourable friend the Secretary of State has frequently shown his awareness of the importance of transport and communications in the development of a vigorous economy. No longer will major rail closures be permitted without regard to economic planning.

In reference to what has been said about rail closures, I found a certain amount of amusement in reading the other day of one of the developments in connection with Highland rail closures. A line, the closure of which had been agreed to, is now having two stations kept open as halts because the railways found that the cost of providing the alternative bus service was so fantastic that it was cheaper to keep the stations open. That is a bit of hope for the Borders, they having experience of the alternative, that the picture is not quite so rosy as some enthusiasts for railway closures once thought it might be.

The expansion of existing air services and the creation of new ones is every bit at important as the preservation of essential rail services. I appreciate very much what has been said by the noble Earl, Lord Dundee, and the noble Lord, Lord Forbes, and nothing would have given me more pleasure personally than to announce that to-day Dundee's needs were at last to be adequately met, though it would have been dimmed by what the noble Earl, Lord Perth, said. Unfortunately even the strongest personal desire on my part cannot accomplish in six weeks what our predecessors failed to achieve in twice that number of years. I am certain however that My object all sublime I shall achieve in time, and that noble Lords opposite will be as happy as I and not think in terms of "a punishment to lit the crime" when this Government succeed where their predecessors failed.

There is one field of Scottish activity which is brighter than that of the general problems. That is of the service industries, including construction, in which (and I must admit quite frankly that this figure was a complete surprise to me) 57 per cent. of all Scottish workers are engaged. In general terms, the construction and civil engineering industries are booming in Scotland, with a growth rate of nearly 5 per cent. This is one field where we are like all Western European countries and the United States, for in them all this is the most rapidly expanding sector and is surely and inevitably associated with a growing standard of living. With all that lies ahead of us, this is a fruitful field of study, and we are pushing on with the examination of new techniques and methods initiated by the previous Government.

One of the difficulties I have found in being a Minister, and having to make speeches like this, is that the Departments push so much material on to one that one is in danger of finding oneself still speaking the following day. I assumed that it would be your Lordships' desire that I should pay some attention to what was said in the course of the debate. Having does that, I rigorously cut down on the material with which I have been furnished, and now I find, to my horror, that I have accumulated a bigger pile to reply to than I started with. So, if I may reply somewhat sketchily, I assure your Lordships that any point which I have missed I will most carefully follow up in the weeks that lie ahead by careful study of the Report of to-day's debate, and by a follow-up to the noble Lords individually where that is the right thing to do.

In the case of the noble Earl, Lord Cromartie, who strayed back into the Highlands, notwithstanding the arrangement, he perhaps will gain the advantage that I will treat what he has said as the first point to be replied to in the next debate.

What I will say is this: one of the noble Lords on the other side who was complimenting the noble Lord, Lord Craigton, on the way he carried out his task at the Scottish Office—and, political differences notwithstanding, this is a compliment with which I wish most heartily to associate myself—mentioned the fact that he also had periodically to suffer from the onslaughts of his own supporters. My Lords, this is a fate from which I am protected.

BARONESS HORSBRUGH

You wait

LORD HUGHES

The noble Lord, Lord Forbes, quoted from the last Government's White Paper about the desirability of integrating the air services. The thought that passed through my mind when he was speaking and when other noble Lords were speaking was the remark which the former Leader of the House made about the things that would be done during the next Government. As more and more noble Lords produced all sorts of projects about which they were so uniformly enthusiastic, but which were not produced during the last four or five years, it seemed to indicate to me that they did not expect to be back in office so very soon, after all. Otherwise I do not think there would have been so many projects for spending public money put forward at this stage.

The noble Earl, Lord Dundee, shows indications that if, during the present Parliament, Dundee has lost one direct spokesman in my coming on to these Benches, Dundee has gained another in the noble Earl. I am certain that the residents of the town from which he takes his title will be glad of the vigorous way in which he is looking after their interests. With regard to the industrial estate to which the noble Earl referred and the need for more industrial building in Dundee, there is one point I can mention. The Dundee Corporation asked for some 40 acres of ground to be released for an industrial estate, and I am happy to be able to say that the Secretary of State has acceded to the request which the Lord Provost made and that this decision has been conveyed to the Dundee Corporation. Forty acres is not a great deal nowadays in terms of industrial use, but I am certain that it will be put to good advantage by the Corporation of Dundee and the Board of Trade.

I had not realised that the noble Baroness, Lady Horsbrugh, had such a profound sense of humour or, for that matter, such an uncomfortably long memory. Still, at the end of the day, I was not so unhappy as I thought I was going to be when she started quoting me.

BARONESS HORSBRUGH

I did not want to make the noble Lord unhappy.

LORD HUGHES

All right, you did not. As a matter of fact, I thought the score was pretty good. The noble Lady said I had made one prophecy and it came right. I cannot do better than 100 per cent. She went on to speak about specific proposals—I thought she was going to say "pacific proposals", but there was nothing pacific about her particular point. I do not think that she has quite done us justice in the matter, because a number of specific proposals have been put forward already by the Government. The decision to cut down office building in London was taken within days of our coming into office. That was one of the things we wanted to do. We tightened up the issue of industrial development certificates. That is something else which is exceedingly specific, and the way in which it is going to be applied, I venture to suggest, will surprise some noble Lords and will delight many, because it is really going to be tough; and it is from this that the other parts of the country will have most to expect.

Nine new advance factories in Scotland, plus others, is pretty specific. I think that if this Government, in its specific proposals which will help Scotland, can keep on at the rate of the first six weeks, then, at the end of the day, if the noble Baroness does complain about what we are doing, she will have to complain that we are doing, not too little but too much. So, on the whole, I am grateful that she has reminded me that a year ago I was already exercising the need to be cautious in what I was saying in case I had to act on it.

The noble Earl, Lord Selkirk, made some interesting statements of broad policy and I was surprised to find myself so completely in agreement with what he was saying. He put forward not detailed but really broad sound principles, which we must keep in mind and which many noble Lords found were echoing what they themselves had been thinking. On only one point did I find myself not too happy, and that was when the noble Earl said that people went to the South for reasons which were either irrational or economic. If, in saying this, he was talking about people who went to set up industries, then I would agree; but if he was talking about individuals who go to work in these industries, I would not agree. Basically, they go because there are jobs; and not only jobs, but a choice of jobs. This is one of the things we do not have in Scotland, particularly when it comes to professional and scientific people. It is not enough to say to them, "Go to the town of X and there is a good job for you there." A man is reluctant to do this, if he knows that there is no other job to which he can go, if the job he is sent to does not suit him or if he falls out with his employer. That is the sort of thing which has taken so many people, both industrial workers and scientists, to the South-East.

THE EARL OF SELKIRK

My Lords, I do not agree with the noble Lord. What I was emphasising was that I consider it probably irrational, and not on economic grounds, why people refuse to start businesses in the Northern part of the island. I was not referring to the drift South.

LORD HUGHES

My Lords, as a matter of fact, many people in this part of the world think that when they get beyond Edinburgh they are up above the snow line.

Noble Lords have raised many other points to which I would dearly like to reply, if only because of the courtesy which every one of them has shown to me in this debate, but I am well aware that it is long past the hour that your Lordships are inclined to regard as "this late hour", and I think it would be a bad start for ire to continue speaking for long at this lime of night in your Lordships' House. But I am really grateful for the things that have been said and, as I have already said, I shall study them individually in the Report and follow them up.

There is one thing which I cannot resist the temptation to say. If my status as Government spokesman is somewhat different from what some noble Lords had expected, there is a compensation in it. In the last Parliament, there was generally only one Minister sitting on these Benches speaking for the Scottish Office. That position remains unchanged. But, in the last Parliament, there were at best two sitting on the opposite Benches to speak for Scotland and I am going to have the benefit of a tremendously reinforced Scottish Opposition. The best I can wish them is that they may have very many years in which to perfect their opposition.

The noble Lord, Lord Drumalbyn, put forward a number of very interesting points, as one would expect from one who has been previously in Scottish administration and Board of Trade administration, but he will forgive me if I do not go into detail. But there are three things which I wish to mention. He referred to the setting up in Scotland of complete industrial units, including selling organisations. I agree most wholeheartedly with what he said. One of the things we have found with the American concerns which have set up in Scotland is that they regard these concerns as being in direct competition with their own home bases and give them every encouragement to be really strong competitors, and when they have proved themselves they are allocated a share of the world markets which is theirs. I only wish that Scottish concerns which are branches of English firms had exactly the same measure of autonomy. Anything we can do to encourage that type of development will be done, because I wholeheartedly agree with the noble Lord about the worthwhile nature of these activities.

On mergers, I must confess that it had not occurred to me that the possible loss of research was one of the things connected with some of these mergers. It would not have escaped your Lordships' notice that members of Her Majesty's present Government are not so enthusiastic about some of these mergers as some other people have been. With this added reason for looking carefully at them, I have no doubt that my right honourable friend and my noble friends will be very happy.

I come now to the Solway project. In the course of the debate somebody passed me a note about it. The noble Lord, Lord Drumalbyn, mentioned the proposal for a Solway barrage. This project, of course, is a most imaginative conception. We have been giving it a preliminary examination, and, since the southern shore of the Solway is in Cumberland, have been working in the closest touch with the North-West England Study Group. Before the idea could be put into practice, extensive and costly technical and economic investigation of its various aspects would be necessary. At this stage our view, which has been confirmed by informal technical discussions with experts from Strathclyde University and elsewhere, is that the water aspect would be the one to look into first. I understand that the North-West Study Group are likely to reach a similar conclusion about a comparable project for Morecambe Bay. The next step must therefore be to consider the merits of these two schemes together in the context of the very substantial and competing claims on the nation's capital investment resources over the coming years. This is a task which will be undertaken by the new regional planning machinery which we are setting up. I am sorry that I cannot go further than this, but it is perhaps going a little further than we could have gone even a day or two ago.

The noble Lord, Lord Drumalbyn, asked why there was no Scottish industrialist on the new Council of Technology and my noble friend Lord Snow almost immediately furnished him with an answer. The gentlemen in the Officials' Box have found another one, and they have passed along to me a note saying that in addition to Mr. Brown of Glacier Metal, Limited, who is a Scot, Scotland is also represented by Dr. Curran of the University of Strathclyde, which has close links with industry—links which, as the noble Earl, Lord Selkirk, suggested, we hope to strengthen. I am sorry that the intervention of the noble Lord, Lord Brecon, in this Scottish debate could not find a Welshman on this Council. Perhaps he may accept a second Scot as a reasonable substitute.

The noble Lord, Lord Polwarth, in his remarks, raised the question of the effect of raising the bank rate on Scottish proposals. We are very conscious of the danger that this could have. As noble Lords fully appreciate, this was done as a necessary temporary measure in order to place beyond doubt the Government's determination to maintain the parity of sterling. But, as my right honourable friend the Chancellor of the Exchequer said yesterday in another place, it is not the Government's desire or policy that there should be a downward revision of investment plans, and it is not our expectation that any such revision will follow. There may, of course, be some effect on the phasing of investment projects, and the Government are, in particular, considering urgently whether some means can be found of mitigating the severity of the bank rate increase, for example, on the housing programme. I hope that, as far as it goes, that is satisfactory. Beyond that I cannot go, even though, in any event, I am straying pretty far from my brief.

The noble Viscount, Lord Stonehaven, made a number of points, particularly about the Highlands. He said that he did not expect a reply to-day, and he will not be disappointed at not getting one. However, I will write to him. The noble Marquess, Lord Lothian, and the noble Baroness, Lady Elliot of Harwood, spoke particularly about the Border problems, and I hope that some of the things I have been able to say will be helpful to them. I should also mention, perhaps, that, notwithstanding my lowly position, I am already doing a number of the things which the noble Lord, Lord Craigton, did, and included in them is a visit to one part of the Borders in a fortnight's time, when I shall be meeting some of the local authorities, and another visit next month when I shall be meeting another set of Border authorities. I may say, incidentally, that I shall also have the pleasure of opening a small factory at Stranraer, and I can now sympathise very much with the noble Baroness, Lady Elliot of Harwood, when she talks about the difficulties of moving about there. We have been talking about (a) how I am going to get there, and (b), how I am going to get away.

The hospital matter which the noble Marquess, Lord Lothian, raised, is, I think, a little away from the context of this debate, but not so far away as I should have said a year or two back. There is an interesting American who has set up an industry which was arranged when I saw him in New York. He put a number of questions to me which brought to me a completely different idea of an industrialist. He asked about a number of things, such as the houses for the people who worked in his place, and what schools there would be. Many industrialists, of course, ask these questions, which are quite usual ones to ask, but the American then asked me another question which I have never before heard an industrialist ask. He wanted to know what the hospital facilities were if any of his workers should fall seriously ill. So it is perhaps not so far away from an industrial and development debate as one might think. I will ask my right honourable friend to look into this question, and either I or she will write to the noble Marquess in due course. The other question the American asked was what were the facilities for his people to worship in a church of their own choice. That is the sort of person we like to see coming into Scotland.

My Lords, I think I have now covered all the points—no: I have not dealt with those raised by the noble Lord, Lord Balerno. Perhaps I should have forgotten these, because I cannot give the noble Lord a satisfactory answer. He raised the point of the possible location of the World Health Organisation and the new Research Body which is to be set up. All I can say is that we are pursuing these matters. The decision is not something that rests finally with the Scottish Office or there would be no doubt as to what the decision would be; just as many of the things which did not happen in the last few years would have taken place if the decision had rested entirely with the noble Lord, Lord Craig-ton. I noticed that, on this point, when the noble Earl, Lord Perth, was raising the same subject, there definitely spoke the former Minister when he wished me luck in the battle with other Government Departments. Believe me, my Lords, this is one aspect of Government which does not change with Party.

I hope that these, I am afraid, somewhat rambling last remarks answer some of the points which your Lordships have raised it the debate. May I be permitted to close on this somewhat general note: that the opinion expressed by so many of those who have taken part in the debate, that they are seeking genuinely to put forward things which will be helpful to Scotland, is something which, in my experience over the last three years, I have found to be genuine. I have not the slightest reason to believe that even the necessity from time to time of immersing ourselves deeply in Party politics will make any difference to the Scottish debates of this character which will occur from time to time. I hope that in the succeeding debates I shall give none of your Lordships any cause to regret the generous things which you said to me during this debate.

LORD CRAIGTON

My Lords, I will say only a few words, as is the custom in this House. I am grateful to so many of my noble friends for taking part in this debate, and I know they would wish me to congratulate the noble Lord, Lord Hughes, on a charming and competent job. I am glad that he is following, with the qualifications he gave us, in the general line we have taken, and I am sure we shall support much of the policy he so forthrightly described. We are grateful for the information he gave us, and we will study it very carefully. I express the hope that the new Scottish Planning Advisory Council will not be too large. I am glad he is going to follow the practice that has been taken in Scottish debates in answering by letter constructive points—he made that quite clear, and I agree with him. I beg leave to withdraw the Motion standing in my name.

Motion for Papers, by leave, withdrawn.